Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-34568 March 28, 1988
RODERICK DAOANG, and ROMMEL DAOANG, assisted by their father,
ROMEO DAOANG, petitioners,
vs.
THE MUNICIPAL JUDGE, SAN NICOLAS, ILOCOS NORTE, ANTERO
AGONOY and AMANDA RAMOS-AGONOY, respondents.

Let copy of this decision be furnished and entered into the

records of the Local Civil Registry of San Nicolas, Ilocos
Norte, for its legal effects at the expense of the petitioners.

The undisputed facts of the case are as follows:

On 23 March 1971, the respondent spouses Antero and Amanda Agonoy
filed a petition with the Municipal Court of San Nicolas, Ilocos Norte, seeking
the adoption of the minors Quirino Bonilla and Wilson Marcos. The case,
entitled: "In re Adoption of the Minors Quirino Bonilla and Wilson Marcos,
Antero Agonoy and Amanda Ramos-Agonoy, petitioners", was docketed
therein as Spec. Proc. No. 37. 2
The petition was set for hearing on 24 April 1971 and notices thereof were
caused to be served upon the office of the Solicitor General and ordered
published in the ILOCOS TIMES, a weekly newspaper of general circulation
in the province of Ilocos Norte, with editorial offices in Laoag City. 3

PADILLA, J.:
This is a petition for review on certiorari of the decision, dated 30 June 1971,
rendered by the respondent judge *in Spec. Proc. No. 37 of Municipal Court
of San Nicolas, Ilocos Norte, entitled: "In re Adoption of the Minors Quirino
Bonilla and Wilson Marcos; Antero Agonoy and Amanda R. Agonoy,
petitioners", the dispositive part of which reads, as follows:
Wherefore, Court renders judgment declaring that
henceforth Quirino Bonilla and Wilson Marcos be, to all
legitimate intents and purposes, the children by adoption of
the joint petitioners Antero Agonoy and Amanda R. Agonoy
and that the former be freed from legal obedience and
maintenance by their respective parents, Miguel Bonilla and
Laureana Agonoy for Quirino Bonilla and Modesto Marcos
and Benjamina Gonzales for Wilson Marcos and their family
names 'Bonilla' and 'Marcos' be changed with "Agonoy",
which is the family name of the petitioners.
Successional rights of the children and that of their adopting
parents shall be governed by the pertinent provisions of the
New Civil Code.

On 22 April 1971, the minors Roderick and Rommel Daoang, assisted by

their father and guardian ad litem, the petitioners herein, filed an opposition
to the aforementioned petition for adoption, claiming that the spouses Antero
and Amanda Agonoy had a legitimate daughter named Estrella Agonoy,
oppositors' mother, who died on 1 March 1971, and therefore, said spouses
were disqualified to adopt under Art. 335 of the Civil Code. 4
After the required publication of notice had been accomplished, evidence
was presented. Thereafter, the Municipal Court of San Nicolas, Ilocos Norte
rendred its decision, granting the petition for adoption. 5
Hence, the present recourse by the petitioners (oppositors in the lower
court).
The sole issue for consideration is one of law and it is whether or not the
respondent spouses Antero Agonoy and Amanda Ramos-Agonoy are
disqualified to adopt under paragraph (1), Art. 335 of the Civil Code.
The pertinent provision of law reads, as follows:
Art. 335. The following cannot adopt:

(1) Those who have legitimate, legitimated, acknowledged

natural children, or children by legal fiction;
xxx xxx xxx
In overruling the opposition of the herein petitioners, the respondents judge
held that "to add grandchildren in this article where no grandchil is included
would violate to (sic) the legal maxim that what is expressly included would
naturally exclude what is not included".
But, it is contended by the petitioners, citing the case of In re Adoption of
Millendez, 6 that the adoption of Quirino Bonilla and Wilson Marcos would not
only introduce a foreign element into the family unit, but would result in the
reduction of their legititimes. It would also produce an indirect, permanent
and irrevocable disinheritance which is contrary to the policy of the law that a
subsequent reconciliation between the offender and the offended person
deprives the latter of the right to disinherit and renders ineffectual any
disinheritance that may have been made.

Adoption used to be for the benefit of the adoptor. It was intended to afford to
persons who have no child of their own the consolation of having one, by
creating through legal fiction, the relation of paternity and filiation where none
exists by blood relationship. 8 The present tendency, however, is geared
more towards the promotion of the welfare of the child and the enhancement
of his opportunities for a useful and happy life, and every intendment is
sustained to promote that objective. 9 Under the law now in force, having
legitimate, legitimated, acknowledged natural children, or children by legal
fiction, is no longer a ground for disqualification to adopt. 10
WHEREFORE, the petition is DENIED. The judgment of the Municipal Court
of San Nicolas, Ilocos Norte in Spec. Proc. No. 37 is AFFIRMED. Without
pronouncement as to costs in this instance.
SO ORDERED.
Yap, Melencio-Herrera, Paras and Sarmiento, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila

We find, however, that the words used in paragraph (1) of Art. 335 of the Civil
Code, in enumerating the persons who cannot adopt, are clear and
unambiguous. The children mentioned therein have a clearly defined
meaning in law and, as pointed out by the respondent judge, do not include
grandchildren.

EN BANC
G.R. No. L-5162

Well known is the rule of statutory construction to the effect that a statute
clear and unambiguous on its face need not be interpreted; stated otherwise,
the rule is that only statutes with an ambiguous or doubtful meaning may be
the subject of statutory construction. 7
Besides, it appears that the legislator, in enacting the Civil Code of the
Philippines, obviously intended that only those persons who have certain
classes of children, are disqualified to adopt. The Civil Code of Spain, which
was once in force in the Philippines, and which served as the pattern for the
Civil Code of the Philippines, in its Article 174, disqualified persons who have
legitimate or legitimated descendants from adopting. Under this article, the
spouses Antero and Amanda Agonoy would have been disqualified to adopt
as they have legitimate grandchildren, the petitioners herein. But, when the
Civil Code of the Philippines was adopted, the word "descendants" was
changed to "children", in paragraph (1) of Article 335.

January 31, 1952

ELISEO SILVA, petitioner,

vs.
THE HONORABLE FELICIANO OCAMPO, GABRIEL P. PRIETO and
QUINTIN PAREDES, JR., in their capacities as Commissioners of the
Public Service Commission and BELEN CABRERA, respondents.
Rivera, Castano, Medina and Ampil for petitioner.
A.R. Aspillera for respondents Hons. Feliciano Ocampo, Gabriel P. Prieto
and Quintin Paredes, Jr. Evaristo R. Sandoval for respondent Belen Cabrera.
BAUTISTA ANGELO, J.:
This is a petition for certiorari wherein it is prayed that, pending hearing, a
writ of preliminary injunction be issued to restrain the respondent Belen

Cabrera from operating her ice plant and that, after hearing, the order
granting said respondent a provisional permit to operate her ice plant be
declared null and void.
Belen Cabrera filed in the Public Service Commission an application for a
certificate of public convenience to install, maintain and operate in the City of
Lipa an ice plant with a 10-ton daily productive capacity and to sell the
produce of said plant in said city as well as in several municipalities of the
province of Batangas. Eliseo Silva opposed the application on the ground
that his ice plant was adequate to meet the needs of the public and that
public convenience did not require the operation of another ice plant.
Commissioner Feliciano Ocampo commissioned Attorney Antonio H.
Aspillera, chief of the legal division, to receive the evidence. Based on the
evidence received by Aspillera, the Commission granted the application. On
appeal, however, the Supreme Court held that the proceedings had before
Attorney Aspillera were null and void being in violation of section 3 of the
Public Service Act, as amended, and set aside the decision of the
Commission and ordered that the case returned for re-hearing.
At the re-hearing before Commissioner Ocampo, counsel for the application
offered to re-submit all the evidence presented by her at the hearing before
Attorney Aspillera. Counsel for oppositor objected to the re-submission
contending that said evidence can only be re-submitted if both parties agree
to do so. Commissioner Ocampo ruled that the evidence could be resubmitted subject only to a revision by the Commissioner of the rulings made
by Attorney Aspillera, and Commissioner Ocampo in fact revised said rulings
and found them to be correct. In the opinion of Commissioner Ocampo, the
applicant has the right either to re-submit her former evidence or to present
evidence de novo and that it is not intended by the decision of this Court to
curtail her right to choose between these two alternatives. On the basis of
this evidence, Commissioner Ocampo granted to the applicant a provisional
permit subject to the condition that it may be cancelled or revoked at any
time and without prejudice to whatever final decision may be rendered in the
case. The motion for reconsideration of oppositor having been denied, he
filed this petition for certiorari.
The dispositive part of the decision invoked by petitioner in opposing the resubmission by the applicant of her evidence says in part as follows:

Setting aside the decision appealed from, let this case be returned to
the Public Service Commission so that evidence may be submitted
by the parties in a hearing or hearings before the Commission in
banc or before any of the Commissioners if properly authorized,
unless of course, said parties agree at said hearing or hearings to resubmit the evidence already presented and taken down, with such
modifications and under such conditions as they may agree upon,
including such other evidence which they wish to present. (G.R. No.
L-3629).
Petitioner contends that Commissioner Ocampo acted in a manner contrary
to the ruling of the Supreme Court when he allowed the re-submission of the
evidence of the applicant, instead of requiring her to present her evidence de
novo, over the objection of the petitioner. For this reason, petitioner
contends, the decision of Commissioner Ocampo should be set aside and
rendered without effect.
The interpretation placed on the above ruling of this Court by Commissioner
Ocampo is indeed erroneous, as it fails to grasp its real import and
significance. The rationale of the rule is none other than to make the
Commission, or any of the Commissioners who may be authorized for this
purpose, to try the case or, receive the evidence itself, as the law requires, so
that it may have the necessary opportunity for observation and appreciation
of the evidence to enable it to reach an accurate and intelligent conclusion.
Mere re-submission of the evidence already presented would not meet this
compelling objective, the only exception being when the opposing parties
agree to such re-submission. This is a privilege that can exercise or waive in
the use of their discretion. Inasmuch as Commissioner Ocampo has not
observed the directive contained in the decision adverted to and it appearing
that this decision has been concurred in by the other two Commissioners, we
are of the opinion that the respondent Commission has committed an abuse
of discretion in overruling the petitioner to the re-submission of the evidence
presented by the applicant before Attorney Aspillera.
We notice, however, that the incident relative to the resubmission of the
evidence of the application took place in connection only with the hearing set
by the Commission for the purpose of determining if said applicant could be
given a provisional or authority to continue operating her 10-ton ice plant in
Lipa City pending hearing and final determination of the case. The hearing
was set at the express instance of the applicant in view of the attitude of the

oppositor in asking for an indefinite postponement of the hearing on the

merits. The Commission found that the applicant had made considerable
investment to acquire and install her 10-ton ice plant in the city of Lipa and
that there was an urgent need for ice not only by the people of that city but
also of the towns of Cuenca, Alitagtag and Ibaan, which condition had
existed and continued to exist since the original decision in this case had
been rendered, for which reasons the Commission found sufficient warrant
the issuance of a provisional permit. In so granting such provisional permit,
the Commission partly said: "If the best interests and convenience of the
public are to be subserved, applicant should be granted a provisional permit,
to continue operating her plant while this case is being litigated. To order the
closing down of applicant's plant in the face of the evidence showing that the
public needs her service would be a disservice to the public. This provisional
authority should be granted because the public's need for the service is
urgent and the hearing and final determination of this case will necessarily
take time."
We are of the opinion that while the evidence presented by the applicant has
been admitted in violation of the directive of this Court, however, such
evidence may serve as justification, if the Commission so finds it, to warrant
the issuance of a provisional permit. There is nothing in the law which
prohibits the Commission from receiving any pertinent evidence for the
purpose of acting on a petition for the provisional permit. The law is silent as
to the procedure to be followed with regard to provisional permit. The law
even empowers the Commission to act, without hearing, on certain matters
of public interest, "subject to established limitations and exceptions and
saving provisions, to the contrary" (section 17, Com. Act 146, as amended).
There being no express prohibition in the law, nor any provision to the
contrary, we hold that the re-submitted evidence may serve as basis for the
issuance of a provisional permit to the applicant.
A case in point Peck vs. Public Utilities Commission, 170 N.E. 364. In this
case, certificates 82 and 83, for interstate bus transportation between Toledo
and Sylvania, Ohio, were owned by the Black Hawk Lines, Inc., and such
company was conducting operations thereunder. Upon the application of
certain creditors, a receiver was appointed. Later, Michigan-Ohio Bus Lines,
Inc., filed an application for an extension of its certificate No 84 to cover the
same route theretofore operated on under certificates 82 and 83 by the Black
Hawk Lines, Inc. The Commission, without notice to the receiver or to the
Black Hawks Lines, Inc., issued an order granting temporarily an extension of

certificate No. 847 to operate over what had theretofore been routes 82 and
83. On appeal, the grant of this temporary permit was assigned as error. The
Supreme Court of Ohio justified the action of the Commission saying on this
point as follows:
Believing in good faith that the public living along the line of this route
was without transportation service, that the transportation company
then holding the certificate serving such territory did not provide the
service required or the particular kind of equipment necessary to
furnish such service, and that the public was practically without
transportation, we cannot find that such temporary order, issued as
an emergency measure, violated the letter or spirit of section 614-87,
General Code. (Peck vs. Public Utilities Commission, 170 N.E. 366).
As regards the contention of petitioner that Public Service Commission has
no power to grant temporary or provisional permit under the law, it suffices
for us to state that the Commission has such power when the purpose of the
permit is to meet an urgent public necessity (Javellana vs. La Paz Ice Plant
and Cold Storage Co., 64 Phil., 893; Ablaza Transportation Co.,
Inc., vs. Pampanga Bus Inc., 88 Phil., 412).
Wherefore, the petition is denied with costs against the petitioner.
It is ordered that the Public Service Commission immediately set the
hearings of this case for trial de novo in line with the ruling of this Court in
G.R. No. L-3629.*
Paras, C.J., Pablo, Bengzon, Padilla, Tuason, Montemayor, Reyes and Jugo,
JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-22301

August 30, 1967

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
MARIO MAPA Y MAPULONG, defendant-appellant.
Francisco P. Cabigao for defendant-appellant.
Office of the Solicitor General Arturo A. Alafriz, Assistant Solicitor General F.
R. Rosete and Solicitor O. C. Hernandez for plaintiff-appellee.
FERNANDO, J.:
The sole question in this appeal from a judgment of conviction by the lower
court is whether or not the appointment to and holding of the position of a
secret agent to the provincial governor would constitute a sufficient defense
to a prosecution for the crime of illegal possession of firearm and
ammunition. We hold that it does not.
The accused in this case was indicted for the above offense in an information
dated August 14, 1962 reading as follows: "The undersized accuses MARIO
MAPA Y MAPULONG of a violation of Section 878 in connection with Section
2692 of the Revised Administrative Code, as amended by Commonwealth
Act No. 56 and as further amended by Republic Act No. 4, committed as
follows: That on or about the 13th day of August, 1962, in the City of Manila,
Philippines, the said accused did then and there wilfully and unlawfully have
in his possession and under his custody and control one home-made
revolver (Paltik), Cal. 22, without serial number, with six (6) rounds of
ammunition, without first having secured the necessary license or permit
therefor from the corresponding authorities. Contrary to law."
When the case was called for hearing on September 3, 1963, the lower court
at the outset asked the counsel for the accused: "May counsel stipulate that
the accused was found in possession of the gun involved in this case, that he
has neither a permit or license to possess the same and that we can submit
the same on a question of law whether or not an agent of the governor can
hold a firearm without a permit issued by the Philippine Constabulary." After
counsel sought from the fiscal an assurance that he would not question the
authenticity of his exhibits, the understanding being that only a question of
law would be submitted for decision, he explicitly specified such question to
be "whether or not a secret agent is not required to get a license for his
firearm."

Upon the lower court stating that the fiscal should examine the document so
that he could pass on their authenticity, the fiscal asked the following
question: "Does the accused admit that this pistol cal. 22 revolver with six
rounds of ammunition mentioned in the information was found in his
possession on August 13, 1962, in the City of Manila without first having
secured the necessary license or permit thereof from the corresponding
authority?" The accused, now the appellant, answered categorically: "Yes,
Your Honor." Upon which, the lower court made a statement: "The accused
admits, Yes, and his counsel Atty. Cabigao also affirms that the accused
admits."
Forthwith, the fiscal announced that he was "willing to submit the same for
decision." Counsel for the accused on his part presented four (4) exhibits
consisting of his appointment "as secret agent of the Hon. Feliciano Leviste,"
then Governor of Batangas, dated June 2, 1962; 1 another document likewise
issued by Gov. Leviste also addressed to the accused directing him to
proceed to Manila, Pasay and Quezon City on a confidential mission; 2the
oath of office of the accused as such secret agent, 3 a certificate dated March
11, 1963, to the effect that the accused "is a secret agent" of Gov.
Leviste.4 Counsel for the accused then stated that with the presentation of
the above exhibits he was "willing to submit the case on the question of
whether or not a secret agent duly appointed and qualified as such of the
provincial governor is exempt from the requirement of having a license of
firearm." The exhibits were admitted and the parties were given time to file
their respective memoranda.1wph1.t
Thereafter on November 27, 1963, the lower court rendered a decision
convicting the accused "of the crime of illegal possession of firearms and
sentenced to an indeterminate penalty of from one year and one day to two
years and to pay the costs. The firearm and ammunition confiscated from
him are forfeited in favor of the Government."
The only question being one of law, the appeal was taken to this Court. The
decision must be affirmed.
The law is explicit that except as thereafter specifically allowed, "it shall be
unlawful for any person to . . . possess any firearm, detached parts of
firearms or ammunition therefor, or any instrument or implement used or
intended to be used in the manufacture of firearms, parts of firearms, or
ammunition."5 The next section provides that "firearms and ammunition

regularly and lawfully issued to officers, soldiers, sailors, or marines [of the
Armed Forces of the Philippines], the Philippine Constabulary, guards in the
employment of the Bureau of Prisons, municipal police, provincial governors,
lieutenant governors, provincial treasurers, municipal treasurers, municipal
mayors, and guards of provincial prisoners and jails," are not covered "when
such firearms are in possession of such officials and public servants for use
in the performance of their official duties."6
The law cannot be any clearer. No provision is made for a secret agent. As
such he is not exempt. Our task is equally clear. The first and fundamental
duty of courts is to apply the law. "Construction and interpretation come only
after it has been demonstrated that application is impossible or inadequate
without them."7 The conviction of the accused must stand. It cannot be set
aside.
Accused however would rely on People v. Macarandang,8 where a secret
agent was acquitted on appeal on the assumption that the appointment "of
the accused as a secret agent to assist in the maintenance of peace and
order campaigns and detection of crimes, sufficiently put him within the
category of a "peace officer" equivalent even to a member of the municipal
police expressly covered by section 879." Such reliance is misplaced. It is not
within the power of this Court to set aside the clear and explicit mandate of a
statutory provision. To the extent therefore that this decision conflicts with
what was held in People v. Macarandang, it no longer speaks with authority.
Wherefore, the judgment appealed from is affirmed.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar,
Sanchez, Castro and Angeles, JJ., concur.
Republic of the Philippines SUPREME COURT Manila EN BANC G.R. Nos.
24116-17 August 22, 1968

CEBU PORTLAND CEMENT COMPANY, plaintiff-appellant, vs.

MUNICIPALITY OF NAGA, CEBU, ET AL.,
defendants-appellees. Tomas P. Matic, Jr. and Lorenzo R. Mosqueda for
plaintiff-appellant. Fernan, Osmea and Bellaflor for defendants-appellees.

FERNANDO, J.: In two separate actions, plaintiff-appellant Cebu Portland

Cement Company sought to test the validity of the distraint and thereafter the
sale at public auction by the principal defendant-appellee, Municipality of
Naga, Cebu, of 100,000 bags of cement for the purpose of satisfying its
alleged deficiency in the payment of the municipal license tax for 1960,
municipal license tax for 1961 as well as the penalty, all in the total sum of
P204,300.00. The lower court rendered a joint decision sustaining the validity
of the action taken by defendant-appellee Municipality of Naga. The case is
now before us on appeal. We affirm. According to the appealed decision:
"From all the evidence, mostly documentary, adduced during the hearing the
following facts have been established. The effort s of the defendant Treasurer
to collect from the plaintiff the municipal license tax imposed by Amended
Ordinance No. 21. Series of 1959 on cement factories located within the
Municipality of Naga, Cebu, have met with rebuff time and again. The
demands made on the taxpayer ... have not been entirely successful.
Finally , the defendant Treasurer decided on June 26, 1961 to avail of the
Civil remedies provided for under Section 2304 of the Revised Administrative
Code and gave the plaintiff a period of ten days from receipt thereof within
which to settle the account, computed as follows ...: Deficiency Municipal
License Tax for 1960 P80 ,250.00; Municipal License Tax for 1961
P90,000.00; and 20% Penalty P34,050.00, stating in exasperation, "This is
our last recourse as we had exhausted all efforts for an amicable solution of
our problem." "1 It was further shown: "On July 6, 1961, at 11:00 A.M., the
defendant Treasurer notified the Plant Manager of the plaintiff that he was
"distraining 100,000 bags of Apo cement in satisfaction of your delinquency
in municipal license taxes in the total amount of P204, 300.00" ... This notice
was received by the acting officer in charge of the plaintiff's plant, Vicente T.
Garaygay, according to his own admission. At first, he was not in accord with
the said letter, asking the defendant Treasurer for time to study the same, but
in the afternoon he [acknowledged the] distraint ..." 2 As was noted in the
decision, the defendant Treasurer in turn "signed the receipt for goods,
articles or effects seized under authority of Section 2304 of the Revised
Administrative Code, certifying that he has constructively distrained on July
6, 1961 from the Cebu Portland Cement Company at its plant at Tina-an,
Naga , Cebu, 100,000 bags of Apo cement in tanks, and that "the said
articles or good s will be sold at public auction to the highest bidder on July
27, 1961, and the proceeds thereof will be utilized in part satisfaction of the
account of the said company in municipal licenses and penalties in the total
amount of P204,300.0 0 due the Municipality of Naga Province of Cebu" ..."3
The lower court likewise found as a fact that on the same day, July 6, 1961,
the municipal treasurer posted the notice of sale to the effect that pursuant to

the provisions of Section 2305 of the Revised Administrative Code, he would

sell a t public auction for cash to the highest bidder at the main entrance of
the municipal building of the Municipality of Naga, Province of Cebu,
Philippines on the 27th day of July, 1961, at 9 o'clock in the morning, the
property seized and distrained or levied upon from the Cebu Portland
Cement Company in satisfaction of the municipal license taxes and penalties
in the amount of P204,300.00, specifying that what was to be sold was
100,000 bags of Apo cement.4 No sale, as thus announced, was held on July
27, 1961. It was likewise stated in the appealed decision that there was
stipulation by the parties to this effect: "1. The auction s ale took place on
January 30, 1962, ..."5 In this appeal from the above joint decision, plaintiffappellant Cebu Portland Cement Company upholds the view that the distraint
of the 100,000 bags of cement as well as the sale at public auction thereafter
made ran counter to the law. As earlier noted, we do not see it that way. 1.
On the validity of the distraint in the first two errors assigned, plaintiff
appellant submits as illegal the distraint of 100,000 bags of cement made on
Jul y 6, 1961. Its contention is premised on the fact that in the letter of
defendant-appellee dated June 26, 1961, requiring plaintiff-appellant to settle
its account of P204,300.00, it was given a period of 10 days from receipt
within which i t could pay, failure to do so being the occasion for the distraint
of its property. It is now alleged that the 10-day period of grace was not
allowed to lapse, the distraint having taken place on July 6, 1961. It suffices
to answer such a contention by referring to the explicit language of the law.
According to the Revised Administrative Code: "The remedy by distraint shall
proceed as follows: Upon the failure of the person owing any municipal tax or
revenue to pay the same, at the time required, the municipal treasurer may
seize and distrain any personal property belonging to such person or any
property subject to the tax lien, in sufficient quantity to satisfy the tax or
charge i n question, together with any increment thereto incident to
delinquency, and the expenses of the distraint."6 The clear and explicit
language of the law leaves no room for doubt. The municipal treasurer "may
seize and distrain any personal property" of the individual or entity subject to
the tax upon failure "to pay the same, at the time required ..." There was such
a failure on the part of plaintiff-appellant to pay the municipal tax at the time
required. The power of the municipal treasurer in accordance with the above
provision therefore came into play.1wph1.t Whatever might have been
set forth in the letter of the municipal treasurer could not change or amend
the law it has to be enforced as written. That was what the lower court did.
What was done then cannot be rightfully looked upon as a failure to abide by
what the statutory provision requires. Time and time again, it has been
repeatedly declared by this Court that where the law speaks in clear and

categorical language, there is no room for interpretation. There is only room f

or application. That was what occurred in this case.7 2. On the validity of the
auction sale the validity of the auction sale held on January 30, 1962 is
challenged in the next two errors assigned as allegedly committed by the
lower court. Plaintiff-appellant's argument is predicated on the fact that it was
not until January 16, 1962 that it was notified that the public auction sale was
to take place on January 29, 1962. It is its view that under the Revised
Administrative Code8 the sale of the distrained property cannot take place
"less than twenty days after notice to the owner or possessor of the property
[distrained] ... and the publication or posting of such notice." Why such a
contention could not prosper is explained clearly by the lower court in the
appealed decision. Thus: "With respect to the claim that the auction sale held
on January 30, 1962 pursuant to the distraint was null and void for being
contrary to law because not more than twenty days have elapsed from the
date of notice, it is believed that the defendant Municipality of Naga and
Municipal Treasurer of Naga have substantially complied with the
requirements provided for by Section 2305 of the Revised Administrative
Code. From the time that the plaintiff was first notified of the distraint on July
6, 1961 up to the date of the sale on January 30, 1962, certainly, more than
twenty days have elapsed. If the sale did not take place, as advertised, on
July 27, 1961, but only on January 30, 1 962, it was due to the requests for
deferment made by the plaintiff which unduly delayed the proceedings for
collection of the tax, and the said taxpayer should not be allowed now to
complain that the required period has not yet elapsed when the intention of
the tax collector was already well-publicized for many months.9 The
reasonableness of the above observation of the lower court cannot be
disputed. Under the circumstances, the allegation that there was no
observance of t he twenty-day period hardly carries conviction. The point is
further made that the auction sale took place not on January 29, 19 62, as
stated in the notice of sale, but on the next day, January 30, 1962. According
to plaintiff-appellant: "On this score alone, the sale ..., was illegal as it was
not made on the time stated in the notice." 10 There is no basis to sustain
such a plea as the finding of the lower court is otherwise. Thus: "On January
16, 1962, the defendant Treasurer informed Garaygay t hat he would cause
the readvertisement for sale at public auction of the 100,000 bags of Apo
cement which were under constructive distraint ... On January 19, 1 962, the
said defendant issued the corresponding notice of sale, which fixed January
30, 1962, at 10:00 A.M., as the date of sale, posting the said notice in public
places and delivering copies thereof to the interested parties in the previous
notice, ... Ultimately, the bidding was conducted on that day, January 30, 1
962, with the representatives of the Provincial Auditor and Provincial

Treasurer present. Only two bidders submitted sealed bids. After the bidding,
the defendant-treasurer informed the plaintiff that an award was given to the
winning bidder, ..." 11 This being a direct appeal to us, plaintiff-appellant must
be deemed to have accepted as conclusive what the lower court found as
established by the evidence, only questions of law being brought to us for
review. It is the established rule that when a party appeals directly to this
Court, he is deemed to have waived the right to dispute any finding of fact
made by the court below. 12 WHEREFORE, the decision of the lower court
dated 23, 1964, is affirmed in toto. With costs against plaintiffappellant.1wph1.t Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal,
Zaldivar, Sanchez, Castro and Angeles, JJ., concur. Footnotes 1Decision of
July 23, 1964 of the lower court, Record on Appeal, pp. 166- 167. 2Ibid, pp.
167-168. 3Ibid, pp. 169-170. 4Ibid, pp. 170-171. 5Ibid, p. 172. 6Section 2304,
Act No. 2711 as amended.

7Cf. Lizarraga Hermanos v. Yap Tico, 24 Phil. 504 (1913); People v. Mapa, L2230 1, August 30, 1967; Pacific Oxygen and Acytelene Co. v. Central Bank,
L-21881, M arch 1, 1968; Dequito v. Lopez, L-27757, March 28, 1968. 8"See.
2305. Proceedings subsequent to seizure. The officer levying the distrain t
shall make or cause to be made an account of the goods or effects
distrained, a copy of which signed by himself shall be left either with the
owner or person from whose possession such goods or effects were taken,
or at the dwelling or pl ace of business of such person and with some one of
suitable age and discretion, to which list shall be added a statement of the
sum demanded and note of the ti me and place of sale; and the said officer
shall forthwith cause a notification to be exhibited in not less than two public
places in the municipality where the distraint was made, specifying the time
and place of sale and the articles dist rained. The time of sale shall not be
less than twenty days after notice to the owner or possessor of the property
as above specified and the publication or pos ting of such notice. One place
for the posting of such notice shall be at the office of the mayor of the
municipality in which the property is distrained. At the time and place fixed in
such notice the said officer shall sell the goods, or effects, so distrained, at
public auction, to the highest bidder for cash..." . 9Decision of the lower court,
Record on Appeal, p. 180. 10Brief for Plaintiff-Appellant, p. 37. 11Decision of
July 23, 1964 of the lower court, p. 175. 12Republic v. Luzon Stevedoring
Corp., L-21749, September 29, 1967. See also Perez v. Araneta, L-18414,
July 15, 1968 and the cases cited therein.
G.R. No. L-26712-16

December 27, 1969

UNITED CHRISTIAN MISSIONARY SOCIETY, UNITED CHURCH BOARD

FOR WORLD MINISTERS, BOARD OF FOREIGN MISSION OF THE
REFORMED CHURCH IN AMERICA, BOARD OF MISSION OF THE
EVANGELICAL UNITED PRESBYTERIAN CHURCH, COMMISSION OF
ECUMENICAL MISSION ON RELATIONS OF THE UNITED
PRESBYTERIAN CHURCH, petitioners,
vs.
SOCIAL SECURITY COMMISSION and SOCIAL SECURITY
SYSTEM, respondents.
Sedfrey A. Ordoez for petitioners.
Office of the Solicitor General Antonio P. Barredo, Assistant Solicitor General
Felicisimo R. Rosete and Solicitor Buenaventura J. Guerrero for
respondents.
TEEHANKEE, J.:

In this appeal from an order of the Social Security Commission, we uphold

the Commission's Order dismissing the petition before it, on the ground that
in the absence of an express provision in the Social Security Act 1 vesting in
the Commission the power to condone penalties, it has no legal authority to
condone, waive or relinquish the penalty for late premium remittances
mandatorily imposed under the Social Security Act.
The five petitioners originally filed on November 20, 1964 separate petitions
with respondent Commission, contesting the social security coverage of
American missionaries who perform religious missionary work in the
Philippines under specific employment contracts with petitioners. After
several hearings, however, petitioners commendably desisted from further
contesting said coverage, manifesting that they had adopted a policy of
cooperation with the Philippine authorities in its program of social
amelioration, with which they are in complete accord. They instead filed their
consolidated amended petition dated May 7, 1966, praying for condonation
of assessed penalties against them for delayed social security premium
remittances in the aggregate amount of P69,446.42 for the period from
September, 1958 to September, 1963.
In support of their request for condonation, petitioners alleged that they had
labored under the impression that as international organizations, they were
not subject to coverage under the Philippine Social Security System, but
upon advice by certain Social Security System officials, they paid to the
System in October, 1963, the total amount of P81,341.80, representing their
back premiums for the period from September, 1958 to September, 1963.
They further claimed that the penalties assessed against them appear to be
inequitable, citing several resolutions of respondent Commission which in the
past allegedly permitted condonation of such penalties.
On May 25, 1966, respondent System filed a Motion to Dismiss on the
ground that "the Social Security Commission has no power or authority to
condone penalties for late premium remittance, to which petitioners filed their
opposition of June 15, 1966, and in turn, respondent filed its reply thereto of
June 22, 1966.
Respondent Commission set the Motion to Dismiss for hearing and oral
argument on July 20, 1966. At the hearing, petitioners' counsel made no
appearance but submitted their Memorandum in lieu of oral argument. Upon
petition of the System's Counsel, the Commission gave the parties a further
period of fifteen days to submit their Memorandum consolidating their
arguments, after which the motion would be deemed submitted for decision.
Petitioners stood on their original memorandum, and respondent System
filed its memorandum on August 4, 1966.

On September 22, 1966, respondent Commission issued its Order

dismissing the petition, as follows:

TOTAL

Considering all of the foregoing, this Commission finds, and so

holds, that in the absence of an express provision in the Social
Security Act vesting in the Commission the power to condone
penalties, it cannot legally do so. The policy enunciated in
Commission Resolution No. 536, series of 1964, cited by the parties,
in their respective pleadings, has been reiterated in Commission
Resolution No. 878, dated August 18, 1966, wherein the Commission
adopting the recommendation of the Committee on Legal Matters
and Legislation of the Social Security Commission ruled that it "has
no power to condone, waive or relinquish the penalties for late
premium remittances which may be imposed under the Social
Security Act."
WHEREFORE, the petition is hereby dismissed and petitioners are
directed to pay the respondent System, within thirty (30) days from
receipt of this Order, the amount of P69,446.42 representing the
penalties payable by them, broken down as follows:

United Christian Missionary Society

P5,253.53

P 69,446.42

Upon failure of the petitioners to comply with this Order within the
period specified herein, a warrant shall be issued to the Sheriff of the
Province of Rizal to levy and sell so much of the property of the
petitioners as may be necessary to satisfy the aforestated liability of
the petitioners to the System.
This Court is thus confronted on appeal with this question of first impression
as to whether or not respondent Commission erred in ruling that it has no
authority under the Social Security Act to condone the penalty prescribed by
law for late premium remittances.
We find no error in the Commission's action.
1. The plain text and intent of the pertinent provisions of the Social Security
Act clearly rule out petitioners' posture that the respondent Commission
should assume, as against the mandatory imposition of the 3% penalty per
month for late payment of premium remittances, the discretionary authority of
condoning, waiving or relinquishing such penalty.
The pertinent portion of Section 22 (a) of the Social Security Act peremptorily
provides that:

Board of Mission of the Evangelical United Brothers

Church

7,891.74

United Church Board for World Ministers

12,353.75

Commission on Ecumenical Mission & Relations

33,019.36

Board of Foreign Mission of the Reformed Church in

America

10,928.04

SEC 22. Remittance of premiums. (a) The contributions imposed

in the preceding sections shall be remitted to the System within the
first seven days of each calendar month following the month for
which they are applicable or within such time as the Commission
may prescribe. "Every employer required to deduct and to remit such
contribution shall be liable for their payment and if any contribution is
not paid to the system, as herein prescribed, he shall pay besides
the contribution a penalty thereon of three per centum per month
from the date the contribution falls due until paid . . .2
No discretion or alternative is granted respondent Commission in the
enforcement of the law's mandate that the employer who fails to comply with
his legal obligation to remit the premiums to the System within the prescribed
period shall pay a penalty of three 3% per month. The prescribed penalty is
evidently of a punitive character, provided by the legislature to assure that
employers do not take lightly the State's exercise of the police power in the
implementation of the Republic's declared policy "to develop, establish
gradually and perfect a social security system which shall be suitable to the

needs of the people throughout the Philippines and (to) provide protection to
employers against the hazards of disability, sickness, old age and death." 3 In
this concept, good faith or bad faith is rendered irrelevant, since the law
makes no distinction between an employer who professes good reasons for
delaying the remittance of premiums and another who deliberately disregards
the legal duty imposed upon him to make such remittance. From the moment
the remittance of premiums due is delayed, the penalty immediately attaches
to the delayed premium payments by force of law.
2. Petitioners contend that in the exercise of the respondent Commission's
power of direction and control over the system, as provided in Section 3 of
the Act, it does have the authority to condone the penalty for late payment
under Section 4 (1), whereby it is empowered to "perform such other acts as
it may deem appropriate for the proper enforcement of this Act." The law
does not bear out this contention. Section 4 of the Social Security Act
precisely enumerates the powers of the Commission. Nowhere from said
powers of the Commission may it be shown that the Commission is granted
expressly or by implication the authority to condone penalties imposed by the
Act.
3. Moreover, the funds contributed to the System by compulsion of law have
already been held by us to be "funds belonging to the members which are
merely held in trust by the Government." 4 Being a mere trustee of the funds
of the System which actually belong to the members, respondent
Commission cannot legally perform any acts affecting the same, including
condonation of penalties, that would diminish the property rights of the
owners and beneficiaries of such funds without an express or specific
authority therefor.
4. Where the language of the law is clear and the intent of the legislature is
equally plain, there is no room for interpretation and construction of the
statute. The Court is therefore bound to uphold respondent Commission's
refusal to arrogate unto itself the authority to condone penalties for late
payment of social security premiums, for otherwise we would be sanctioning
the Commission's reading into the law discretionary powers that are not
actually provided therein, and hindering and defeating the plain purpose and
intent of the legislature.
5. Petitioners cite fourteen instances in the past wherein respondent
Commission had granted condonation of penalties on delayed premium
payments. They charge the Commission with grave abuse of discretion in not
having uniformly applied to their cases its former policy of granting
condonation of penalties. They invoke more compelling considerations of
equity in their cases, in that they are non-profit religious organizations who
minister to the spiritual needs of the Filipino people, and that their delay in
the payment of their premiums was not of a contumacious or deliberate

defiance of the law but was prompted by a well-founded belief that the Social
Security Act did not apply to their missionaries.
The past instances of alleged condonation granted by the Commission are
not, however, before the Court, and the unilateral conclusion asserted by
petitioners that the Commission had granted such condonations would be of
no avail, without a review of the pertinent records of said cases.
Nevertheless, assuming such conclusion to be correct, the Commission, in
its appealed Order of September 22, 1966 makes of record that since its
Resolution No. 536, series of 1964, which it reiterated in another resolution
dated August 18, 1966, it had definitely taken the legal stand, pursuant to the
recommendation of its Committee on Legal Matters and Legislation, that in
the absence of an express provision in the Social Security Act vesting in the
Commission the power to condone penalties, it "has no power to condone,
waive or relinquish the penalties for late premium remittances which may be
imposed under the Social Security Act."
6. The Commission cannot be faulted for this correct legal position. Granting
that it had erred in the past in granting condonation of penalties without legal
authority, the Court has held time and again that "it is a well-known rule that
erroneous application and enforcement of the law by public officers do not
block subsequent correct application of the statute and that the Government
is never estopped by mistake or error on the part of its agents." 5 Petitioners'
lack of intent to deliberately violate the law may be conceded, and was borne
out by their later withdrawal in May, 1966 of their original petitions in
November, 1964 contesting their social security coverage. The point,
however, is that they followed the wrong procedure in questioning the
applicability of the Social Security Act to them, in that they failed for five
years to pay the premiums prescribed by law and thus incurred the 3%
penalty thereon per month mandatorily imposed by law for late payment. The
proper procedure would have been to pay the premiums and then contest
their liability therefor, thereby preventing the penalty from attaching. This
would have been the prudent course, considering that the Act provides in
Section 22 (b) thereof that the premiums which the employer refuses or
neglects to pay may be collected by the System in the same manner as
taxes under the National Internal Revenue Code, and that at the time they
instituted their petitions in 1964 contesting their coverage, the Court had
already ruled in effect against their contest three years earlier, when it held
in Roman Catholic Archbishop vs. Social Security Commission6 that the
legislature had clearly intended to include charitable and religious institutions
and other non-profit institutions, such as petitioners, within the scope and
coverage of the Social Security Act.
7. No grave abuse of discretion was committed, therefore, by the
Commission in issuing its Order dismissing the petition for condonation of
penalties for late payment of premiums, as claimed by petitioners in their

second and last error assigned. Petitioners were duly heard by the
Commission and were given due opportunity to adduce all their arguments,
as in fact they filed their Memorandum in lieu of oral argument and waived
the presentation of an additional memorandum. The mere fact that there was
a pending appeal in the Court of Appeals from an identical ruling of the
Commission in an earlier case as to its lack of authority to condone penalties
does not mean, as petitioners contend, that the Commission was thereby
shorn of its authority and discretion to dismiss their petition on the same legal
ground.7 The Commission's action has thus paved the way for a final ruling of
the Court on the matter.
ACCORDINGLY, the order appealed from is hereby affirmed, without
pronouncement as to costs.
Concepcion, C.J., Reyes, J.B.L., Makalintal, Zaldivar Sanchez, Castro and
Fernando, JJ., concur.

proceeding with the scheduled foreclosure sale of the real properties the
above-named appellant spouses had mortgaged with the Development Bank
of the Philippines to secure the loan aforementioned.
The said appealed decision was based on the following:
STIPULATION OF FACTS.
The undersigned parties, thru counsels, hereby submit the
foregoing stipulation of facts, to wit:
I. That the petitioners filed an application for an urban estate
loan with the Rehabilitation Finance Corporation (RFC),
predecessor-in-interest of the herein respondent-bank, in the
amount of P19,500.00;

Dizon and Barredo, JJ., took no part.

G.R. No. L-26419 October 16, 1970
GEDEON G. QUIJANO and EUGENIA T. QUIJANO, petitioners-appellants,
vs.
THE DEVELOPMENT BANK OF THE PHILIPPINES and THE EXOFICIO SHERIFF OF MISAMIS OCCIDENTAL, respondents-appellees.
J. Alaric P. Acosta for petitioners-appellant.

II. That the petitioners' urban real estate loan was approved
per RFC Board Resolution No. 2533 on April 30, 1953;
III. That the mortgage contract was executed by the
petitioners in favor of the respondent-bank on March 23,
1954;
IV. That the said loan of P19,500.00 was to be received by
the petitioners in several releases, subject among others, to
the following conditions:.

Esperanza Valenzoga for respondents-appellees.

"(1) That the amount of P4,200.00 shall be
released only after:.
BARREDO, J.:.
Appeal from the decision of the Court of First Instance of Misamis Occidental
in its Special Civil Case No. 2519, dismissing the petition for mandamus with
prayer for a writ of preliminary injunction filed therein by the herein
petitioners-appellants Gedeon G. Quijano and Eugenio T. Quijano to compel
the herein respondent-appellee Development Bank of the Philippines to
accept said petitioners-appellants' back pay certificate payment of their loan
from the said appellee Bank, and to restrain the herein respondentappellee ex-oficio sheriff of the province of Misamis Occidental from

"(a) the execution and

registration of the mortgage
contract;
"(b) the presentation of a
duly approved building
permit;
"(c) the construction has
been started and the value

of the work done amounted

to P6,500.00;.
"(d) the submission of the
certificate of title covering
Psu-136173, free form any
encumbrance and
"(e) the submission of
evidence showing full
payment of current estate
taxes;
(2) That the subsequent releases shall not
be more than 100% of the value of the
construction completed in excess of
P6,500.00; that all releases shall be made
against the payroll of workers engaged in
the project, receipts of all materials used
and that there are no unpaid labor or unpaid
materials;
(3) That a sufficient amount may be withheld
until the building is completed and painted
and found in accordance with the plans and
specifications submitted;
(4) That the amount of insurance of the
building, when completed, shall not be less
than P18,000.00, which shall be secured by
the mortgagee, in accordance with its Board
Resolution No. 3395, series of 1947;
(5) That the construction and painting of the
building shall be completed within 120 days
from the date of the mortgage contract;
(6) That the release of this loan is subject to
the availability of funds;

(7) That the lien appearing on the face of the

title shall be cancelled, otherwise, Luciana
Jimenez shall sign as co-mortgagor; that this
mortgage contract was registered on March
23, 1954 with the Register of Deeds of
Misamis Occidental at Oroquieta;
"V. That the first release of P4,200 was made on April 29,
1954, and the other releases were made subsequent
thereafter;
"VI. That as of July 31, 1965, the outstanding obligation of
the petitioners with the respondent-bank, including interests,
was P13,983.59;
"VII. That on July 27, 1965, petitioner Gedeon Quijano, as
holder of Acknowledgment No. 10181, wrote the respondentbank in Manila offering to pay in the amount of P14,000.00
for his outstanding obligation with the respondent-bank, out
of the proceeds of his back pay pursuant to Republic Act No.
897;
"VIII. That the respondent-bank, thru its Ozamis Branch
advised the petitioners of the non-acceptance of his offer on
the ground that the loan was not incurred before or
subsisting on June 20, 1953 when Republic Act 897 was
approved;
"IX. That the respondent-bank, thru its Ozamis City Branch,
filed on October 14, 1965, an application for the foreclosure
of real estate mortgage executed by the petitioners, and that
acting on the application of the respondent-bank, the
Provincial Sheriff, thru his deputies, scheduled the public
auction sale for January 18, 1966, after advising petitioner
Gedeon Quijano of the application for foreclosure filed by the
respondent-bank;
"X. That the parties herein agree to transfer the auction sale
scheduled for January 16, 1966 to February 18, 1966,
without the necessity of republication of the notice of sale."

Upon these facts and the submission of the parties that the only issue is
whether or not the obligation of the petitioners was subsisting at the time of
the approval of Republic Act No. 897, the Amendatory Act of Julie 20, 1953 to
Republic Act 304, the original back pay law, the trial court dismissed the
petition, as already stated, and directed respondent sheriff to proceed and
continue with the public auction sale of the property mortgaged in
accordance with the foreclosure application of respondent Development
Bank of the Philippines after due notice to petitioners. In their appeal,
petitioners' sole assignment of error is that: "The trial court erred in declaring
that the loan of the petitioners-appellants was not subsisting when Republic
Act No. 897 was enacted on June 20, 1953."
The appeal has no merit.
The pertinent portions of the controlling provisions of the aforementioned
Back Pay Law, as amended by Republic Act No. 897 on June 20, 1953, 1 read
as follows:.
SEC. 2. The Treasurer of the Philippines shall, upon
application of all persons specified in section one hereof and
within one year from the approval of this Amendatory Act,
and under such rules and regulations as may be
promulgated by the Secretary of Finance, acknowledge and
file requests for the recognition of the right to the Salaries
and wages as provided in section one hereof and notice of
such acknowledgment shall be issued to the applicant which
shall state the total amount of such salaries or wages due
the applicant, and certify that it shall be redeemed by the
Government of the Philippines within ten years from the date
of their issuance without interests: Provided, That upon
application and subject to such rules and regulations as may
be approved by the Secretary of Finance a certificate of
indebtedness may be issued by the Treasurer of the
Philippines covering the whole or a part of the total salaries
and wages the right to which has been duly acknowledged
and recognized, provided that the face value of such
certificate of indebtedness shall not exceed the amount that
the applicant may need for the payment of (1) obligations
subsisting at the time of the approval of this Amendatory Act
for which the applicant may directly be liable to the

government or to any of its branches or instrumentalities, or

the corporations owned or controlled by the Government, or
to any citizen of the Philippines, or to any association or
corporation organized under the laws of the Philippines, who
may be willing to accept the same for such settlement; ...
It is indeed settled that under the above provisions, the Government or any of
its agencies does not have any discretion in the acceptance of back pay
certificates, 2 when they are used by the applicants or original holders
themselves for the settlement of any of the obligations or liabilities
specifically enumerated in the law.3 It is equally clear, however, that the same
provisions expressly require that the obligations for which certificates of
indebtedness may be accepted as payments of must besubsisting at the
time of the approval of Republic Act No. 897; hence when, as in the instant
case, such back pay certificates are offered in payment to a governmentowned corporation of an obligation thereto which was not subsisting at the
time of the enactment of said amendatory Act on June 20, 1953, which
corporation may not, legally be compelled to accept the certificates.
It is true that appellants' application for an urban real estate loan was
approved by appellee bank on April 80, 1953. It appears, however, that
appellants did not avail of it until much later, as in fact, they executed the
mortgage contract only on March 23, 1954, and furthermore, that the release
of the amount of the said loan of P19,500.00 was to be made in installments
and subject to compliance with certain conditions by said appellants. Under
these circumstances, Our ruling in the case of Rodriguez vs. Development
Bank of the Philippines 4 is controlling.
In that case, Rodriguez obtained a loan from the said Development Bank of
the Philippines to be received by him in several releases and to be paid later
in installments, under the terms and conditions specified in the loan
agreement. Pursuant to said agreement, Rodriguez received the first release
in the sum of P5,000.00 on May 27, 1953, while the subsequent releases
covering the P9,000.00 balance of the loan were all availed of and
received by him later than June, 1953. Later, Rodriguez paid the installments
as they fell due. When a balance of about P10,000.00 remained unpaid,
Rodriguez offered to pay the said outstanding balance of the loan with his
back pay certificate. The Bank refused at first to accept the said tender of
payment in certificate, and when it accepted the same later, it limited its
acceptance only to the amount of P5,000.00 representing the portion of the

loan released before the passage of Republic Act No. 897, although the
amount of the back pay certificate offered by Rodriguez was more than
sufficient to cover the total unpaid balance of the loan. So, Rodriguez
instituted an action for mandamus in the Court of First Instance of Davao to
compel the Bank to accept his back pay certificate in payment of his whole
outstanding obligation or, in other words, even for the portions of the loan
corresponding to the releases made after June 20, 1953. This action was
dismissed by the trial court and upon appeal to this Court, the dismissal was
affirmed upon the following rationale:.
It can not be said that appellant became indebted to the
Bank for the total amount of P14,000.00 from the date of the
agreement. The releases of the balance of the agreed loan
were made dependent on certain conditions (see additional
conditions mentioned in paragraph 4 of the stipulation of
facts, supra) among which is the availability of funds. Noncompliance with any of these conditions will not entitle the
appellant to the release of the balance of the agreed loan
and conversely, will not entitle the bank to hold the appellant
liable for the unreleased amounts. Consequently, we hold, as
did the trial court, that:.
"... the amounts released in July, 1953 and
thereafter cannot be considered as
obligations subsisting in June, 1953. The
defendant may be compelled to accept a
back pay certificate in payment of
obligations subsisting when the Amendatory
Act was approved (Sec. 2, Republic Act
897).t.hqw Republic Act 897 was
approved on June 20, 1953. The defendant
may not be compelled to accept plaintiff's
back pay certificate in payment of the
amounts released after June 20, 1953."
The case of Sabelino v. RFC (G.R. No. L-11790, Sept. 30,
1958) relied upon by appellant is irrelevant, as the mortgage
indebtedness sought to be paid with appellee's back pay
certificate therein, appears to have subsisted prior to the
approval of Republic Act No. 897. ...

Herein appellants' situation is even worse than that of Rodriguez. Here

appellants actually availed of their approved loan only about nine (9) months
after the enactment of Republic Act 897 and the corresponding releases
thereof were received by appellants only after the execution of the mortgage
contract on March 23, 1954. Undoubtedly, notwithstanding the approval by
the appellee Development Bank of the Philippines (RFC) of appellants' loan
application on April 30, 1953, appellants did not thereby incur any obligation
to pay the same; only after the corresponding amounts were released to
appellants after March 23, 1954 did such obligation attach; and it cannot,
therefore, be said that the said loan was an obligation subsisting at the time
of the approval of Republic Act No. 897 on June 20, 1953.
It may be truly said, as contended by appellants, that when their application
for the loan was approved by the appellee Bank on April 30, 1953, an
agreement was perfected between them and said Bank, but it should be
noted that under such agreement the only enforceable obligation that was
created was that of the Bank to grant the loan applied for, whereas the
obligation of appellants to pay the same could not have arisen until after the
amount of the loan has been actually released to them; and said release was
even subject to their compliance with certain conditions specified in the
mortgage contract executed after the approval already of Republic Act 897.
Appellants' appeal that a more liberal construction of the law would enable
"many crippled or disabled veterans, or their wives and orphans, or those
who had in one way or another unselfishly sacrificed or contributed to the
cause of the last war" to take advantage of their back pay certificates, does
deserve sympathy, for indeed, among the avowed purposes of the said law
are: "First, to serve as a source of financial aid to needy veterans, like
crippled or disabled veterans, and to their wives and orphans. Secondly, to
give recognition to the sacrifices of those who joined the last war, and
particularly to those who have given their all for the cause of the last war."
(Congressional Record No. 61, 2nd Congress, 4th Regular Session, May 6,
1953, page 74, as quoted in Florentino, et al. vs. PNB, 98 Phil. 959, 961963).t.hqw On the other hand, however, We cannot see any room for
interpretation or construction in the clear and unambiguous language of the
above-quoted provision of law. This Court has steadfastly adhered to the
doctrine that its first and fundamental duty is the application of the law
according to its express terms, interpretation being called for only when such
literal application is impossible.5 No process of interpretation or construction
need be resorted to here a provision of law peremptorily calls for application.
Where a requirement or condition is made in explicit and unambiguous

terms, no discretion is left to the judiciary. It must see to it that its mandate is
obeyed.6 Thus, even before the amendment of the Back Pay Law, when said
law limited the applicability of back pay certificates to "obligations subsisting
at the time of the approval of this Act," this Court has ruled that obligations
contracted after its enactment on June 18, 1948 cannot come within its
purview.
Since the debt of appellants was contracted on November
24, 1948, they could not validly seek to discharge it by
application of their back pay certificate under Republic Act
304, on June 18, 1948, because that Act, in terms, limited
any such application to "obligations subsisting at the time of
the approval of this Act". (Sec. 2)7
WHEREFORE, the judgment of the trial court is affirmed. No costs.
Reyes, J.B.L., Act. C.J., Dizon, Makalintal, Zaldivar, Castro, Fernando,
Teehankee, Villamor and Makasiar, JJ., concur.
G.R. No. L-28463 May 31, 1971
REPUBLIC FLOUR MILLS INC., petitioner,
vs.
THE COMMISSIONER OF CUSTOMS and THE COURT OF TAX
APPEALS, respondents.
Agrava & Agrava for petitioner.
Office of the Solicitor General Antonio P. Barredo, Assistant Solicitor General
Pacifico P. de Castro and Solicitor Santiago M. Kapunan for respondents.

FERNANDO, J.:
It is a novel question that this petition for the review of a decision of
respondent Court of Tax Appeals presents. Petitioner Republic Flour Mills,
Inc. would have this Court construe the words "products of the Philippines"
found in Section 2802 of the Tariff and Custom Code 1 as excluding bran (ipa)
and pollard (darak) on the ground that, coming as they do from wheat grain

which is imported in the Philippines, they are merely waste and not the
products, which is the flour produced. 2 That way, it would not be liable at all
for the wharfage dues assessed under such section by respondent
Commission of Customs. It elevated the matter to respondent Court, as the
construction it would place on the aforesaid section appears too strained and
far remote from the ordinary meaning of the text, not to mention the policy of
the Act. We affirm.
In the decision of respondent Court now sought to be reviewed, after stating
that what was before it was an appeal from a decision of the Commissioner
of Customs holding petitioner liable for the sum of P7,948.00 as wharfage
due the facts were set forth as follows: "Petitioner, Republic Flour Mills, Inc.,
is a domestic corporation, primarily engaged in the manufacture of wheat
flour, and produces pollard (darak) and bran (ipa) in the process of milling.
During the period from December, 1963 to July, 1964, inclusive, petitioner
exported Pollard and/or bran which was loaded from lighters alongside
vessels engaged in foreign trade while anchored near the breakwater The
respondent assessed the petitioner by way of wharfage dues on the said
exportations in the sum of P7,948.00, which assessment was paid by
petitioner under protest." 3 The only issue, in the opinion of respondent Court,
is whether or not such collection of wharfage dues was in accordance with
law. The main contention before respondent Court of petitioner was "that
inasmuch as no government or private wharves or government facilities
[were] utilized in exporting the pollard and/or bran, the collection of wharfage
dues is contrary to law." 4 On the other hand, the stand of respondent
Commissioner of Customs was that petitioner was liable for wharfage dues
"upon receipt or discharge of the exported goods by a vessel engaged in
foreign trade regardless of the non-use of government-owned or private
wharves." 5 Respondent Court of Tax Appeals sustained the action taken by
the Commissioner of Customs under the appropriate provision of the Tariff
and Customs Code, relying on our decision in Procter & Gamble Phil.
Manufacturing Corp. v. Commissioner of Customs. 6 It did not feel called
upon to answer the question now before us as, in its opinion, petitioner only
called its attention to it for the first time in its memorandum.
Hence, this petition for review. The sole error assigned by petitioner is that it
should not, under its construction of the Act, be liable for wharfage dues on
its exportation of bran and pollard as they are not "products of the
Philippines", coming as they did from wheat grain which were imported from
abroad, and being "merely parts of the wheat grain milled by Petitioner to

produce flour which had become waste." 7 We find, to repeat, such contention
unpersuasive and affirm the decision of respondent Court of Tax Appeals.
1. The language of Section 2802 appears to be quite explicit: "There shall be
levied, collected and paid on all articles imported or brought into the
Philippines, and on products of the Philippines ... exported from the
Philippines, a charge of two pesos per gross metric ton as a fee for wharfage
...." One category refers to what is imported. The other mentions products of
the Philippines that are exported. Even without undue scrutiny, it does
appear quite obvious that as long as the goods are produced in the country,
they fall within the terms of the above section. Petitioner appeared to have
entertained such a nation. In its petition for review before respondent Court, it
categorically asserted: "Petitioner is primarily engaged in the manufacture of
flour from wheat grain. In the process of milling the wheat grain into flour,
petitioner also produces 'bran' and 'pollard' which it exports abroad." 8 It does
take a certain amount of hair-splitting to exclude from its operation what
petitioner calls "waste" resulting from the production of flour processed from
the wheat grain in petitioner's flour mills in the Philippines. It is always timely
to remember that, as stressed by Justice Moreland: "The first and
fundamental duty of courts, in our judgment, is to apply the law. Construction
and interpretation come only after it has been demonstrated that application
is impossible or inadequate without them." 9 Petitioner ought to have been
aware that deference to such a doctrine precludes an affirmative response to
its contention. The law is clear; it must be obeyed. It is as simple, as that. 10
2. There is need of confining familiar language of a statute to its usual
signification. While statutory construction involves the exercise of choice, the
temptation to roam at will and rely on one's predilections as to what policy
should prevail is to be resisted. The search must be for a reasonable
interpretation. It is best to keep in mind the reminder from Holmes that "there
is no canon against using common sense in construing laws as saying what
obviously means." 11 To paraphrase Frankfurter, interpolation must be
eschewed but evisceration avoided. Certainly, the utmost effort should be
exerted lest the interpretation arrived at does violence to the statutory
language in its total context. It would be then to ignore what has been
stressed time and time again as to limits of judicial freedom in the
construction of statutes to accept their view advanced by petitioner.
3. Then, again, there is the fundamental postulate in statutory construction
requiring fidelity to the legislative purpose. What Congress intended is not to

be frustrates. Its objective must be carried out. Even if there be doubt as to

the meaning of the language employed, the interpretation should not be at
war with the end sought to be attained. No undue reflection is needed to
show that if through an ingenious argument, the scope of a statute may be
contracted, the probability that other exceptions may be thought of is not
remote. If petitioner were to prevail, subsequent pleas motivated by the same
desire to be excluded from the operation of the Tariff and Customs Code
would likewise be entitled to sympathetic consideration. It is desirable then
that the gates to such efforts at undue restriction of the coverage of the Act
be kept closed. Otherwise, the end result would be not respect for, but
defiance of, a clear legislative mandate. That kind of approach in statutory
construction has never recommended itself. It does not now. 12
WHEREFORE, the decision of respondent Court of Tax Appeals of
November 27, 1967 is affirmed. With costs against petitioner.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Villamor and
Makasiar, JJ., concur.
Castro, Teehankee and Barredo, JJ., took no part.

Footnotes
1 Section 2802 of the Tariff and Customs Code (1957) reads
in full "Schedule of Dues. There shall be levied, collected
and paid on all articles imported or brought into the
Philippines, and on products of the Philippines except coal,
lumber, creosoted and other pressure treated materials as
well as other minor forest products, cement, guano natural
rock asphalt, the minerals and ores of base metals (e.g.,
copper, lead, zinc, iron, chromite manganese, magnesite
and steel), and sugar molasses exported from the
Philippines, a charge of two pesos per gross metric ton as a
fee for wharfage: Provided, That in the case of logs, or
flitches twelve inches square or equivalent cross-sectional
area, or over, a charge of sixty centavos per cubic meter
shall be collected."

2 According to the petition: "(a) Petitioner is engaged in the

manufacture of flour from wheat grain. It imports the wheat
grain from abroad and mills the same to produce the flour.
The wheat grain is not a product of the Philippines. Properly
and technically speaking, the product of the milling process
is the flour produced. (b) In the course of producing flour,
part of the wheat grain be waste in the form of bran and
pollard." Par. 4, p. 2.

Vasquez, L-26808, March 28, 1969, 27 SCRA 505; La Perla

Cigar & Cigarette Factory v. Capapas, L-27948 & 28001-11,
July 31, 1969, 28 SCRA 1085; Mobil Oil Phil., Inc. v.
Diocares, L-26371, Sept. 30, 1969, 29 SCRA 656; Luzon
Surety Co., Inc. v. De Garcia, L-25659, Oct. 31, 1969, 30
SCRA 111; Vda. de Macabenta v. Davao Stevedore Terminal
Company, L-27489, April 30, 1970, 32 SCRA 553.
11 Rosehen v. Ward, 279 US 337, 339 (1929).

3 Decision, Appendix to Petitioner's Brief, pp. 9-10.

4 Ibid., p. 10.
5 Ibid.
6 L-22819, April 27, 1967, 19 SCRA 883. This portion of
Justice Bengzon's opinion was cited in the opinion of
respondent Court of Tax Appeals: "But when a vessel
anchors at the Bay and discharges or unloads its cargo,
wharfage dues are forthwith collected. For, as stated, said
dues are assessed against the cargo discharged. This is
clear from the provision of the law under which the
assessment is based on the quantity, weight or measure of
the cargo received by the importer and/or discharged by
such vessel. And wharfage dues on the cargo are distinct
from harbor fees or berthing charges on the vessel, so much
so that different sections of the law cover them." At p. 889.

12 Cf. Ty Sue v. Hord, 12 Phil. 485 (1909; United States v.

Toribio, 15 Phil. 85 (1910) ; Riera v. Palmaroli, 40 Phil. 105
(1919); Commissioner of Customs v. Caltex Phil., Inc., 106
Phil. 829 (1959); Sarcos v. Castillo, L-29755, Jan. 31, 1969,
26 SCRA 853; Automotive Parts & Equipment Co., Inc. v.
Lingad, L-26406, Oct. 31, 1969, 30 SCRA 248.
G.R. No. L-61236 January 31, 1984
NATIONAL FEDERATION OF LABOR and ZAMBOWOOD MONTHLY
EMPLOYEES UNION, ITS OFFICERS AND MEMBERS, petitioners,
vs.
THE HONORABLE CARLITO A. EISMA, LT. COL. JACOB CARUNCHO,
COMMANDING OFFICER, ZAMBOANGA DISTRICT COMMAND, PC, AFP,
and ZAMBOANGA WOOD PRODUCTS, respondents.
Jose C. Espina and Potenciano Flores for petitioners.

7 Decision, Appendix to Petitioner's Brief, p. 7.

The Solicitor General for public respondents.

8 Petition for Review before respondent Court of Tax

Appeals dated April 7, 1967, par. 3.

Gaspar V. Tagalo for private respondent Zamboanga Wood Products.

9 Lizarraga Hermanos v. Yap Tico, 24 Phil. 504, 513 (1913).

FERNANDO, C.J.:
10 Cf. People v. Mapa, L-22301, Aug. 30, 1967, 20 SCRA
1164; Pacific Oxygen & Acetylene Co. v. Central Bank, L21881, March 1, 1968, 22 SCRA 917; Dequito v. Lopez, L27757, March 28, 1968, 22 SCRA 1352; Padilla v. City of
Pasay, L-24039, June 29, 1968, 23 SCRA 1349; Garcia v.

This Court is confronted once again with the question of whether or not it is a
court or a labor arbiter that can pass on a suit for damages filed by the
employer, here private respondent Zamboanga Wood Products. Respondent
Judge Carlito A. Eisma 1 then of the Court of First Instance, now of the

Regional Trial Court of Zamboanga City, was of the view that it is a court and
denied a motion to dismiss filed by petitioners National Federation of labor
and Zambowood Monthly Employees Union, its officers and members. It was
such an order dated July 20, 1982 that led to the filing of this certiorari and
prohibition proceeding. In the order assailed, it was required that the officers
and members of petitioner union appear before the court to show cause why
a writ of preliminary injunction should not be issued against them and in the
meanwhile such persons as well as any other persons acting under their
command and on their behalf were "temporarily restrained and ordered to
desist and refrain from further obstructing, impeding and impairing plaintiff's
use of its property and free ingress to or egress from plaintiff's Manufacturing
Division facilities at Lumbayao, Zamboanga City and on its road right of way
leading to and from said plaintiff's facilities, pending the determination of the
litigation, and unless a contrary order is issued by this Court." 2
The record discloses that petitioner National Federation of Labor, on March
5, 1982, filed with the Ministry of Labor and Employment, Labor Relations
Division, Zamboanga City, a petition for direct certification as the sole
exclusive collective bargaining representative of the monthly paid employees
of the respondent Zamboanga Wood Products, Inc. at its manufacturing plant
in Lumbayao, Zamboanga City. 3 Such employees, on April 17, 1982 charged
respondent firm before the same office of the Ministry of Labor for
underpayment of monthly living allowances. 4Then came, on May 3, 1982,
from petitioner union, a notice of strike against private respondent, alleging
illegal termination of Dionisio Estioca, president of the said local union; unfair
labor practice, non-payment of living allowances; and "employment of
oppressive alien management personnel without proper permit. 5 It was
followed by the union submitting the minutes of the declaration of strike,
"including the ninety (90) ballots, of which 79 voted for yes and three voted
for no." 6The strike began on May 23, 1982. 7 On July 9, 1982, private
respondent Zambowood filed a complaint with respondent Judge against the
officers and members of petitioners union, for "damages for obstruction of
private property with prayer for preliminary injunction and/or restraining
order." 8 It was alleged that defendants, now petitioners, blockaded the road
leading to its manufacturing division, thus preventing customers and
suppliers free ingress to or egress from such premises. 9 Six days later, there
was a motion for the dismissal and for the dissolution of the restraining order
and opposition to the issuance of the writ of preliminary injunction filed by
petitioners. It was contended that the acts complained of were incidents of
picketing by defendants then on strike against private respondent, and that

therefore the exclusive jurisdiction belongs to the Labor Arbiter pursuant to

Batas Pambansa Blg. 227, not to a court of first instance.10 There was, as
noted earlier, a motion to dismiss, which was denied. Hence this petition for
certiorari.
Four days after such petition was filed, on August 3, 1982, this Court required
respondents to answer and set the plea for a preliminary injunction to be
heard on Thursday, August 5, 1982. 11 After such hearing, a temporary
restraining order was issued, "directing respondent Judge and the
commanding officer in Zamboanga and his agents from enforcing the exparte order of injunction dated July 20, 1982; and to restrain the respondent
Judge from proceeding with the hearing of the until otherwise case effective
as of [that] date and continuing ordered by [the] Court. In the exercise of the
right to peaceful picketing, petitioner unions must abide strictly with Batas
Pambansa Blg. 227, specifically Section 6 thereof, amending Article 265 of
the Labor Code, which now reads: '(e) No person engaged in picketing shall
commit any act of violence, coercion or intimidation or obstruct the free
ingress to or egress from the employer's premises for lawful purposes, or
obstruct public thoroughfares.' " 12
On August 13, 1982, the answer of private respondent was filed sustaining
the original jurisdiction of respondent Judge and maintaining that the order
complained of was not in excess of such jurisdiction, or issued with grave
abuse of discretion. Solicitor General Estelito P. Mendoza, 13 on the other
hand, instead of filing an answer, submitted a Manifestation in lieu thereof.
He met squarely the issue of whether or not respondent Judge had
jurisdiction, and answered in the negative. He (i)ncluded that "the instant
petition has merit and should be given due course."
He traced the changes undergone by the Labor Code, citing at the same time
the decisions issued by this Court after each of such changes. As pointed
out, the original wording of Article 217 vested the labor arbiters with
jurisdictional. 14 So it was applied by this Court in Garcia v. Martinez 15 and
in Bengzon v. Inciong. 16 On May 1, 1978, however, Presidential Decree No.
1367 was issued, amending Article 217, and provided "that the Regional
Directors shall not indorse and Labor Arbiters shall not entertain claims for
moral and other forms of damages." 17 The ordinary courts were thus vested
with jurisdiction to award actual and moral damages in the case of illegal
dismissal of employees. 18 That is not, as pointed out by the Solicitor
General, the end of the story, for on May 1, 1980, Presidential Decree No.

1691 was issued, further amending Article 217, returning the original
jurisdiction to the labor arbiters, thus enabling them to decide "3. All money
claims of workers, including those based on non-payment or underpayment
of wages, overtime compensation, separation pay and other benefits
provided by law or appropriate agreement, except claims for employees
compensation, social security, medicare and maternity benefits; [and] (5) All
other claims arising from employer-employee relations unless expressly
excluded by tills Code." 19 An equally conclusive manifestation of the lack of
jurisdiction of a court of first instance then, a regional trial court now, is Batas
Pambansa Blg. 130, amending Article 217 of the Labor Code. It took effect
on August 21, 1981. Subparagraph 2, paragraph (a) is now worded thus: "(2)
those that involve wages, hours of work and other terms and conditions of
employment." 20 This is to be compared with the former phraseology "(2)
unresolved issue in collective bargaining, including those that involve wages,
hours of work and other terms and conditions of employment." 21 It is to be
noted that Batas Pambansa Blg. 130 made no change with respect to the
original and exclusive jurisdiction of Labor Arbiters with respect to money
claims of workers or claims for damages arising from employer-employee
relations.
Nothing becomes clearer, therefore, than the meritorious character of this
petition. certiorari and prohibition lie, respondent Judge being devoid of
jurisdiction to act on the matter.
1. Article 217 is to be applied the way it is worded. The exclusive original
jurisdiction of a labor arbiter is therein provided for explicitly. It means, it can
only mean, that a court of first instance judge then, a regional trial court judge
now, certainly acts beyond the scope of the authority conferred on him by law
when he entertained the suit for damages, arising from picketing that
accompanied a strike. That was squarely within the express terms of the law.
Any deviation cannot therefore be tolerated. So it has been the constant
ruling of this Court even prior toLizarraga Hermanos v. Yap Tico, 22 a 1913
decision. The ringing words of the ponencia of Justice Moreland still call for
obedience. Thus, "The first and fundamental duty of courts, in our judgment,
is to apply the law. Construction and interpretation come only after it has
been demonstrated that application is impossible or inadequate without
them." 23 It is so even after the lapse of sixty years. 24
2. On the precise question at issue under the law as it now stands, this Court
has spoken in three decisions. They all reflect the utmost fidelity to the plain

command of the law that it is a labor arbiter, not a court, that ossesses
original and exclusive jurisdiction to decide a claim for damages arising from
picketing or a strike. In Pepsi-Cola Bottling Co. v. Martinez, 25 the issue was
set forth in the opening paragraph, in the ponencia of Justice Escolin: "This
petition for certiorari, prohibition and mandamus raises anew the legal
question often brought to this Court: Which tribunal has exclusive jurisdiction
over an action filed by an employee against his employer for recovery of
unpaid salaries, separation benefits and damages the court of general
jurisdiction or the Labor Arbiter of the National Labor Relations Commission
[NLRC]?" 26 It was categorically held: "We rule that the Labor Arbiter has
exclusive jurisdiction over the case."27 Then came this portion of the opinion:
"Jurisdiction over the subject matter in a judicial proceeding is conferred by
the sovereign authority which organizes the court; and it is given only by law.
Jurisdiction is never presumed; it must be conferred by law in words that do
not admit of doubt. Since the jurisdiction of courts and judicial tribunals is
derived exclusively from the statutes of the forum, the issue before us should
be resolved on the basis of the law or statute now in force. We find that law
in presidential Decree 1691 which took effect on May 1, 1980, Section 3 of
which reads as follows: ... Article 217. Jurisdiction of Labor Arbiters and the
Commission. (a) The Labor Arbiters shall have the original and exclusive
jurisdiction to hear and decide the following cases involving all workers,
whether agricultural or non-agricultural: ... 3. All money claims of workers,
including those based on nonpayment or underpayment of wages, overtime
compensation, separation pay and other benefits provided by law or
appropriate agreement, except claims for employees' compensation, social
security, medicare and maternity benefits; 4. Cases involving household
services; and 5. All other claims arising from employer-employee relations,
unless expressly excluded by this Code." 28 That same month, two other
cases were similarly decided, Ebon v. De Guzman 29 and Aguda v. Vallejos. 30
3. It is regrettable that the ruling in the above three decisions, decided in
March of 1982, was not followed by private respondent when it filed the
complaint for damages on July 9, 1982, more than four months later. 31 On
this point, reference may be made to our decision in National Federation of
Labor, et al. v. The Honorable Minister of Labor and
Employment, 32 promulgated on September 15, 1983. In that case, the
question involved was the failure of the same private respondent,
Zamboanga Wood Products, Inc., to admit the striking petitioners, eighty-one
in number, back to work after an order of Minister Blas F. Ople certifying to
the National Labor Relations Commission the labor dispute for compulsory

arbitration pursuant to Article 264 (g) of the Labor Code of the Philippines. It
was noted in the first paragraph of our opinion in that case: "On the face of it,
it seems difficult to explain why private respondent would not comply with
such order considering that the request for compulsory arbitration came from
it. It ignored this notification by the presidents of the labor unions involved to
its resident manager that the striking employees would lift their picket line
and start returning to work on August 20, 1982. Then, too, Minister Ople
denied a partial motion for reconsideration insofar as the return-to-work
aspect is concerned which reads: 'We find no merit in the said Motion for
Reconsideration. The Labor code, as amended, specifically Article 264 (g),
mandates that whenever a labor dispute is certified by the Minister of Labor
and Employment to the National Labor Relations Commission for compulsory
arbitration and a strike has already taken place at the time of certification, "all
striking employees shall immediately return to work and the employees shall
immediately resume operations and readmit all workers under the same
terms and conditions prevailing before the strike." ' " 33 No valid distinction
can be made between the exercise of compulsory arbitration vested in the
Ministry of Labor and the jurisdiction of a labor arbiter to pass over claims for
damages in the light of the express provision of the Labor Code as set forth
in Article 217. In both cases, it is the Ministry, not a court of justice, that is
vested by law with competence to act on the matter.

WHEREFORE, the writ of certiorari is granted and the order of July 20, 1982,
issued by respondent Judge, is nullified and set aside. The writ of prohibition
is likewise granted and respondent Judge, or whoever acts in his behalf in
the Regional Trial Court to which this case is assigned, is enjoin from taking
any further action on Civil Case No. 716 (2751), except for the purpose of
dismissing it. The temporary restraining order of August 5, 1982 is hereby
made permanent.

4. The issuance of Presidential Decree No. 1691 and the enactment of Batas
Pambansa Blg. 130, made clear that the exclusive and original jurisdiction for
damages would once again be vested in labor arbiters. It can be affirmed that
even if they were not that explicit, history has vindicated the view that in the
appraisal of what was referred to by Philippine American Management &
Financing Co., Inc. v. Management & Supervisors Association of the
Philippine-American Management & Financing Co., Inc. 34 as "the rather
thorny question as to where in labor matters the dividing line is to be
drawn" 35 between the power lodged in an administrative body and a court,
the unmistakable trend has been to refer it to the former. Thus: "Increasingly,
this Court has been committed to the view that unless the law speaks clearly
and unequivocally, the choice should fall on [an administrative
agency]." 36 Certainly, the present Labor Code is even more committed to the
view that on policy grounds, and equally so in the interest of greater
promptness in the disposition of labor matters, a court is spared the often
onerous task of determining what essentially is a factual matter, namely, the
damages that may be incurred by either labor or management as a result of
disputes or controversies arising from employer-employee relations.

Gregorio E. Fajardo for appellant.

Teehankee, Makasiar, Aquino, Guerrero, Melencio-Herrera, Plana, Escolin

Relova and Gutierrez, Jr., JJ., concur.
Concepcion Jr., J., took no part.
De Castro, J., is on leave.
G.R. No. L-25316 February 28, 1979
KAPISANAN NG MGA MANGGAGAWA SA MANILA RAILROAD
COMPANY CREDIT UNION, INC., petitioner-appellant,
vs.
MANILA RAILROAD COMPANY, respondent appellee.

Gregorio Baroque for appellee.

FERNANDO, J.:
In this mandamus petition dismissed by the lower court, petitioner-appellant
would seek a reversal of such decision relying on what it considered to be a
right granted by Section 62 of the Republic Act No. 2023, more specifically
the first two paragraphs thereof: "... (1) A member of a cooperative may,
notwithstanding the provisions of existing laws, execute an agreement in
favor of the co-operative authorizing his employer to deduct from the salary
or wages payable to him by the employer such amount as may be specified
in the agreement and to pay the amount so deducted to the co-operative in
satisfaction of any debt or other demand owing from the member to the cooperative. (2) Upon the exemption of such agreement the employer shall if so

required by the co-operative by a request in writing and so long as such debt

or other demand or any part of it remains unpaid, make the claimant and
remit forth with the amount so deducted to the co-operative." 1

This petition being one for mandamus and the provision of law relied upon
being clear on its face, it would appear that no favorable action can be taken
on this appeal. We affirm.

To show that such is futile, the appealed decision, as quoted in the brief for
petitioner-appellant, stated the following: "Then petitioner contends that
under the above provisions of Rep. Act 2023, the loans granted by credit
union to its members enjoy first priority in the payroll collection from the
respondent's employees' wages and salaries. As can be clearly seen, there
is nothing in the provision of Rep. Act 2023 hereinabove quoted which
provides that obligation of laborers and employees payable to credit unions
shall enjoy first priority in the deduction from the employees' wages and
salaries. The only effect of Rep. Act 2023 is to compel the employer to
deduct from the salaries or wages payable to members of the employees'
cooperative credit unions the employees' debts to the union and to pay the
same to the credit union. In other words, if Rep. Act 2023 had been enacted,
the employer could not be compelled to act as the collecting agent of the
employees' credit union for the employees' debt to his credit union but to
contend that the debt of a member of the employees cooperative credit union
as having first priority in the matter of deduction, is to write something into
the law which does not appear.In other words, the mandatory character of
Rep. Act 2023 is only to compel the employer to make the deduction of the
employees' debt from the latter's salary and turn this over to the employees'
credit union but this mandatory character does not convert the credit union's
credit into a first priority credit. If the legislative intent in enacting pars. 1 and
2 of Sec. 62 of Rep. Act 2023 were to give first priority in the matter of
payments to the obligations of employees in favor of their credit unions, then,
the law would have so expressly declared. Thus, the express provisions of
the New Civil Code, Arts. 2241, 2242 and 2244 show the legislative intent on
preference of credits. 2

1. The applicable provision of Republic Act No. 2023 quoted earlier, speaks
for itself. There is no ambiguity. As thus worded, it was so applied. Petitionerappellant cannot therefore raise any valid objection. For the lower court to
view it otherwise would have been to alter the law. That cannot be done by
the judiciary. That is a function that properly appertains to the legislative
branch. As was pointed out in Gonzaga v. Court of Appeals: 4 "It has been
repeated time and time again that where the statutory norm speaks
unequivocally, there is nothing for the courts to do except to apply it. The law,
leaving no doubt as to the scope of its operation, must be obeyed. Our
decisions have consistently born to that effect. 5.

Such an interpretation, as could be expected, found favor with the

respondent-appellee, which, in its brief, succinctly pointed out "that there is
nothing in said provision from which it could be implied that it gives top
priority to obligations of the nature of that payable to petitioner, and that,
therefore, respondent company, in issuing the documents known as Exhibit
"3" and Exhibit "P", which establish the order of priority of payment out of the
salaries of the employees of respondent-appellee, did not violate the abovequoted Section 62 of Republic Act 2023. In promulgating Exhibit "3", [and]
Exhibit "P" respondent, in effect, implemented the said provision of law. 3

2. Clearly, then, mandamus does not lie. Petitioner-appellant was unable to

show a clear legal right. The very law on which he would base his action fails
to supply any basis for this petition. A more rigorous analysis would have
prevented him from instituting a a suit of this character. In J.R.S. Business
Corporation v. Montesa, 6 this Court held. "Man-damus is the proper remedy
if it could be shown that there was neglect on the part of a tribunal in the
performance of an act, which specifically the law enjoins as a duty or an
unlawful exclusion of a party from the use and enjoyment of a right to which
he is entitled. 7 The opinion continued in this wise:"According to former Chief
Justice Moran," only specific legal rights may be enforced by mandamus if
they are clear and certain. If the legal rights are of the petitioner are not well
defined, clear, and certain, the petition must be dismissed. In support of the
above view, Viuda e Hijos de Crispulo Zamora v. Wright was cited. As was
there categorically stated: "This court has held that it is fundamental that the
duties to be enforced by mandamus must be those which are clear and
enjoined by law or by reason of official station, and that petitioner must have
a clear, legal right to the thing and that it must be the legal duty of the
defendant to perform the required act.' As expressed by the then Justice
Recto in a subsequent opinion: "It is well establish that only specific legal
rights are enforceable by mandamus, that the right sought to be enforced
must be certain and clear, and that the writ not issue in cases where the right
is doubtful." To the same effect is the formulation of such doctrine by former
Justice Barrera: "Stated otherwise, the writ never issues in doubtful cases. It
neither confers powers nor imposes duties. It is simply a command to
exercise a power already possessed and to perform a duty already

imposed." 8 So it has been since then. 9The latest reported case, Province. of
Pangasinan v. Reparations Commission, 10 this court speaking through
Justice Concepcion Jr., reiterated such a well-settled doctrine: "It has also
been held that it is essential to the issuance of the writ of mandamus that the
plaintiff should have a clear legal right to the thing demanded, and it must be
the imperative duty of the defendant to perform the act required. It never
issues in doubtful cases. 11
WHEREFORE, the appealed decision is affirmed. No pronouncement as to
costs.
Barredo, Antonio, Concepcion, Jr., Santos and Abad Santos, JJ., concur.

Taking cognizance of the complaint, NTC directed RCPI to answer the

complaint and set the initial hearing of the case to 2 May 1989. After two (2)
resettings, RCPI moved to dismiss the case on the following grounds:
1. Juan Alegre is not the real party in interest;
2. NTC has no jurisdiction over the case;
3. the continued hearing of the case violates its constitutional
right to due process of law. 2
RCPI likewise moved for deferment of scheduled hearings until final
determination of its motion to dismiss.

Aquino, J., took no part.

G.R. No. 93237 November 6, 1992
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC.
(RCPI), petitioner,
vs.
NATIONAL TELECOMMUNICATIONS COMMISSION (NTC) and JUAN A.
ALEGRE, respondents.

PADILLA, J.:
Private respondent Juan A. Alegre's wife, Dr. Jimena Alegre, sent two (2)
RUSH telegrams through petitioner RCPI's facilities in Taft Ave., Manila at
9:00 in the morning of 17 March 1989 to his sister and brother-in-law in
Valencia, Bohol and another sister-in-law in Espiritu, Ilocos Norte, with the
following identical texts:

On 15 June 1989, NTC proceeded with the hearing and received evidence
for private respondent Juan Alegre. On 3 October 1989, RCPI's motion to
dismiss was denied, thus:
The herein complainant is the husband of the sender of the
"rush" telegram that respondent allegedly failed to deliver in
a manner respondent bound itself to undertake, so his legal
interest in this administrative case cannot be seriously called
in question. As regards the issue of jurisdiction, the authority
of the Commission to hear and decide this case stems from
its power of control and supervision over the operation of
public communication utilities as conferred upon it by law.
Besides, the filing of a motion to dismiss is not allowed by
the rules (Section 1, Rule 12, Rules of Practice and
Procedures). Following, however, the liberal construction of
the rules, respondent (sic) motion shall be treated as its
answer or be passed upon after the conclusion of the
hearing on the merits. . . . 3

MANONG POLING DIED INTERMENT TUESDAY 1

Both telegrams did not reach their destinations on the expected dates.
Private respondent filed a letter-complaint against the RCPI with the National
Telecommunications Commission (NTC) for poor service, with a request for
the imposition of the appropriate punitive sanction against the company.

Hearings resumed in the absence of petitioner RCPI which was, however,

duly notified thereof. On 27 November 1989, NTC disposed of the
controversy in the following manner:
WHEREFORE, in view of all the foregoing, the Commission
finds respondent administratively liable for deficient and

inadequate service defined under Section 19(a) of C.A. 146

and hereby imposes the penalty of FINE payable within thirty
(30) days from receipt hereof in the aggregate amount of
ONE THOUSAND PESOS (P1,000.00) for:
1. Rush Telegram sent to Valencia, Bohol on March 17, 1989
and received on March 21, 1989
3 days x P200.00 per day = P600.00
2. Rush Telegram sent to Espiritu, Ilocos Norte on March 17,
1989 and received on March 20, 1989
2 days x P200.00 per day = P400.00
Total = P1,000.00
ENTERED. November 27, 1989. 4
A motion for reconsideration by RCPI reiterating averments in its earlier
motion to dismiss was denied for lack of merit; 5 hence, this petition for
review invoking C.A. 146 Sec. 19(a) which limits the jurisdiction of the Public
Service Commission (precursor of the NTC) to the fixing of rates. RCPI
submits that its position finds support in two (2) decided cases 6 identical with
the present one. Then Justice (later Chief Justice) Fernando writing for the
Court stated:
. . . There can be no justification then for the Public Service
Commission imposing the fines for these two petitions. The
law cannot be any clearer. The only power it possessed over
radio companies, as noted was the (sic ) fix rates. It could
not take to task a radio company for negligence or
misfeasance. It was bereft of such competence. It was not
vested within such authority. . . .
The Public Service Commission having been abolished by
virtue of a Presidential Decree, as set forth at the outset, and
a new Board of Communications having been created to
take its place, nothing said in its decision has reference to

whatever powers are now lodged in the latter body. . . . . . .

(Footnotes omitted)
Two (2) later cases, 7 adhering to the above tenet ruled:
Even assuming that the respondent Board of
Communications has the power of jurisdiction over petitioner
in the exercise of its supervision to insure adequate public
service, petitioner cannot be subjected to payment of fine
under sec. 21 of the Public Service Act, because this
provision of the law subjects to a fine every public service
that violates or falls (sic) to comply with the terms and
conditions of any certificate or any orders, decisions and
regulations of the Commission. . . . .
The Office of the Solicitor General now claims that the cited cases are no
longer applicable, that the power and authority of the NTC to impose fines is
incidental to its power to regulate public service utilities and to supervise
telecommunications facilities, which are now clearly defined in Section 15,
Executive Order No. 546 dated 23 July 1979: thus:
Functions of the Commission. The Commission shall
exercise the following functions:
xxx xxx xxx
b. Establish, prescribe and regulate the areas of operation of
particular operators of the public service communications;
xxx xxx xxx
h. Supervise and inspect the operation of radio stations and
telecommunications facilities.
Regulatory administrative agencies necessarily impose sanctions, adds the
Office of the Solicitor General. RCPI was fined based on the finding of the
NTC that it failed to undertake adequate service in delivering two (2) rush
telegrams. NTC takes the view that its power of supervision was broadened
by E. O. No. 546, and that this development superseded the ruling in RCPI
vs. Francisco Santiago and companion cases.

The issues of due process and real parties in interest do not have to be
discussed in this case. This decision will dwell on the primary question of
jurisdiction of the NTC to administratively impose fines on a telegraph
company which fails to render adequate service to a consumer.
E. O. 546, it will be observed, is couched in general terms. The NTC stepped
"into the shoes" of the Board of Communications which exercised powers
pursuant to the Public Service Act. The power to impose fines should
therefore be read in the light of the Francisco Santiago case because
subsequent legislation did not grant additional powers to the Board of
Communications. The Board in other words, did not possess the power to
impose administrative fines on public services rendering deficient service to
customers, ergo its successor cannot arrogate unto itself such power, in the
absence of legislation. It is true that the decision in RCPI vs. Board of
Communications seems to have modified the Santiago ruling in that the later
case held that the Board of Communications can impose fines if the public
service entity violates or fails to comply with the terms and conditions of any
certificate or any order, decision or regulation of the Commission. But can
private respondent's complaint be similarly treated when the complaint seeks
redress of a grievance against the company? 8 NTC has no jurisdiction to
impose a fine. Globe Wireless Ltd. vs. Public Service Commission (G. R. No.
L-27250, 21 January 1987, 147 SCRA 269) says so categorically.
Verily, Section 13 of Commonwealth Act No. 146, as
amended, otherwise known as the Public Service Act, vested
in the Public Service Commission jurisdiction, supervision
and control over all public services and their franchises,
equipment and other properties.
xxx xxx xxx
The act complained of consisted in petitioner having
allegedly failed to deliver the telegraphic message of private
respondent to the addressee in Madrid, Spain. Obviously,
such imputed negligence has nothing whatsoever to do with
the subject matter of the very limited jurisdiction of the
Commission over petitioner.

fine in cases of violation of or failure by a public service to

comply with the terms and conditions of any certificate or
any orders, decisions or regulations of the Commission.
Petitioner operated under a legislative franchise, so there
were no terms nor conditions of any certificate issued by the
Commission to violate. Neither was there any order, decision
or regulation from the Commission applicable to petitioner
that the latter had allegedly violated, disobeyed, defied or
disregarded.
No substantial change has been brought about by Executive Order No. 546
invoked by the Solicitor General's Office to bolster NTC's jurisdiction. The
Executive Order is not an explicit grant of power to impose administrative
fines on public service utilities, including telegraphic agencies, which have
failed to render adequate service to consumers. Neither has it expanded the
coverage of the supervisory and regulatory power of the agency. There
appears to be no alternative but to reiterate the settled doctrine in
administrative law that:
Too basic in administrative law to need citation of
jurisprudence is the rule that jurisdiction and powers of
administrative agencies, like respondent Commission, are
limited to those expressly granted or necessarily implied
from those granted in the legislation creating such body; and
any order without or beyond such jurisdiction is void and
ineffective . . . (Globe Wireless case, supra).
WHEREFORE, the decision appealed from is REVERSED and SET ASIDE
for lack of jurisdiction of the NTC to render it. The temporary restraining order
issued on 18 June 1990 is made PERMANENT without prejudice, however,
to the filing by the party aggrieved by the conduct of RCPI, of the proper
action in the proper forum. No costs.
SO ORDERED.
Cruz, Grio-Aquino and Bellosillo, JJ., concur.
Medialdea, J., is on leave.

Moreover, under Section 21 of C. A. 146, as amended, the

Commission was empowered to impose an administrative

G.R. No. L-30642 April 30, 1985

PERFECTO S. FLORESCA, in his own behalf and on behalf of the

minors ROMULO and NESTOR S. FLORESCA; and ERLINDA
FLORESCA-GABUYO, PEDRO S. FLORESCA, JR., CELSO S.
FLORESCA, MELBA S. FLORESCA, JUDITH S. FLORESCA and
CARMEN S. FLORESCA;
LYDIA CARAMAT VDA. DE MARTINEZ in her own behalf and on behalf
of her minor children LINDA, ROMEO, ANTONIO JEAN and ELY, all
surnamed Martinez; and DANIEL MARTINEZ and TOMAS MARTINEZ;

Petitioners are the heirs of the deceased employees of Philex Mining

Corporation (hereinafter referred to as Philex), who, while working at its
copper mines underground operations at Tuba, Benguet on June 28, 1967,
died as a result of the cave-in that buried them in the tunnels of the mine.
Specifically, the complaint alleges that Philex, in violation of government
rules and regulations, negligently and deliberately failed to take the required
precautions for the protection of the lives of its men working underground.
Portion of the complaint reads:
xxx xxx xxx

SALUSTIANA ASPIRAS VDA. DE OBRA, in her own behalf and on

behalf of her minor children JOSE, ESTELA, JULITA SALUD and
DANILO, all surnamed OBRA;
LYDIA CULBENGAN VDA. DE VILLAR, in her own behalf and on behalf
of her minor children EDNA, GEORGE and LARRY III, all surnamed
VILLAR;
DOLORES LOLITA ADER VDA. DE LANUZA, in her own behalf and on
behalf of her minor children EDITHA, ELIZABETH, DIVINA, RAYMUNDO,
NESTOR and AURELIO, JR. all surnamed LANUZA;
EMERENCIANA JOSE VDA. DE ISLA, in her own behalf and on behalf of
her minor children JOSE, LORENZO, JR., MARIA, VENUS and FELIX, all
surnamed ISLA, petitioners,
vs.
PHILEX MINING CORPORATION and HON. JESUS P. MORFE, Presiding
Judge of Branch XIII, Court of First Instance of Manila, respondents.
Rodolfo C. Pacampara for petitioners.
Tito M. Villaluna for respondents.

MAKASIAR, J.:
This is a petition to review the order of the former Court of First Instance of
Manila, Branch XIII, dated December 16, 1968 dismissing petitioners'
complaint for damages on the ground of lack of jurisdiction.

9. That for sometime prior and up to June 28,1967, the

defendant PHILEX, with gross and reckless negligence and
imprudence and deliberate failure to take the required
precautions for the due protection of the lives of its men
working underground at the time, and in utter violation of the
laws and the rules and regulations duly promulgated by the
Government pursuant thereto, allowed great amount of
water and mud to accumulate in an open pit area at the mine
above Block 43-S-1 which seeped through and saturated the
600 ft. column of broken ore and rock below it, thereby
exerting tremendous pressure on the working spaces at its
4300 level, with the result that, on the said date, at about 4
o'clock in the afternoon, with the collapse of all underground
supports due to such enormous pressure, approximately
500,000 cubic feet of broken ores rocks, mud and water,
accompanied by surface boulders, blasted through the
tunnels and flowed out and filled in, in a matter of
approximately five (5) minutes, the underground workings,
ripped timber supports and carried off materials, machines
and equipment which blocked all avenues of exit, thereby
trapping within its tunnels of all its men above referred to,
including those named in the next preceding paragraph,
represented by the plaintiffs herein;
10. That out of the 48 mine workers who were then working
at defendant PHILEX's mine on the said date, five (5) were
able to escape from the terrifying holocaust; 22 were
rescued within the next 7 days; and the rest, 21 in number,
including those referred to in paragraph 7 hereinabove, were

left mercilessly to their fate, notwithstanding the fact that up

to then, a great many of them were still alive, entombed in
the tunnels of the mine, but were not rescued due to
defendant PHILEX's decision to abandon rescue operations,
in utter disregard of its bounden legal and moral duties in the
premises;

pre- existing contractual relation between the parties, is

called a quasi-delict and is governed by the provisions of this
Chapter.

xxx xxx xxx

(b) Art. 1173The fault or negligence of the obligor consists

in the omission of that diligence which is required by the
nature of the obligation and corresponds with the
circumstances of the persons, of the time and of the place.
When negligence shows bad faith, the provisions of Articles
1171 and 2201, paragraph 2 shall apply.

13. That defendant PHILEX not only violated the law and the
rules and regulations duly promulgated by the duly
constituted authorities as set out by the Special Committee
above referred to, in their Report of investigation, pages 713, Annex 'B' hereof, but also failed completely to provide its
men working underground the necessary security for the
protection of their lives notwithstanding the fact that it had
vast financial resources, it having made, during the year
1966 alone, a total operating income of P 38,220,254.00, or
net earnings, after taxes of P19,117,394.00, as per its llth
Annual Report for the year ended December 31, 1966, and
with aggregate assets totalling P 45,794,103.00 as of
December 31, 1966;

Art. 2178. The provisions of articles 1172 to 1174 are also

applicable to a quasi-delict.

Art. 2201. x x x x x x x x x
In case of fraud, bad faith, malice or wanton attitude, the
obligor shall be responsible for all damages which may be
reasonably attributed to the non-performance of the
obligation.
Art. 2231. In quasi-delicts, exemplary damages may be
granted if the defendant acted with gross negligence.

xxx xxx xxx

(pp. 42-44, rec.)
A motion to dismiss dated May 14, 1968 was filed by Philex alleging that the
causes of action of petitioners based on an industrial accident are covered by
the provisions of the Workmen's Compensation Act (Act 3428, as amended
by RA 772) and that the former Court of First Instance has no jurisdiction
over the case. Petitioners filed an opposition dated May 27, 1968 to the said
motion to dismiss claiming that the causes of action are not based on the
provisions of the Workmen's Compensation Act but on the provisions of the
Civil Code allowing the award of actual, moral and exemplary damages,
particularly:
Art. 2176. Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged to pay for
the damage done. Such fault or negligence, if there is no

After a reply and a rejoinder thereto were filed, respondent Judge issued an
order dated June 27, 1968 dismissing the case on the ground that it falls
within the exclusive jurisdiction of the Workmen's Compensation
Commission. On petitioners' motion for reconsideration of the said order,
respondent Judge, on September 23, 1968, reconsidered and set aside his
order of June 27, 1968 and allowed Philex to file an answer to the complaint.
Philex moved to reconsider the aforesaid order which was opposed by
petitioners.
On December 16, 1968, respondent Judge dismissed the case for lack of
jurisdiction and ruled that in accordance with the established jurisprudence,
the Workmen's Compensation Commission has exclusive original jurisdiction
over damage or compensation claims for work-connected deaths or injuries
of workmen or employees, irrespective of whether or not the employer was
negligent, adding that if the employer's negligence results in work-connected
deaths or injuries, the employer shall, pursuant to Section 4-A of the

Workmen's Compensation Act, pay additional compensation equal to 50% of

the compensation fixed in the Act.
Petitioners thus filed the present petition.

or disease, without regard to the fault or negligence of the employer, while

the claim for damages under the Civil Code which petitioners pursued in the
regular court, refers to the employer's liability for reckless and wanton
negligence resulting in the death of the employees and for which the regular
court has jurisdiction to adjudicate the same.

In their brief, petitioners raised the following assignment of errors:

I
THE LOWER COURT ERRED IN DISMISSING THE
PLAINTIFFS- PETITIONERS' COMPLAINT FOR LACK OF
JURISDICTION.
II
THE LOWER COURT ERRED IN FAILING TO CONSIDER
THE CLEAR DISTINCTION BETWEEN CLAIMS FOR
DAMAGES UNDER THE CIVIL CODE AND CLAIMS FOR
COMPENSATION UNDER THE WORKMEN'S
COMPENSATION ACT.
A
In the first assignment of error, petitioners argue that the lower court has
jurisdiction over the cause of action since the complaint is based on the
provisions of the Civil Code on damages, particularly Articles 2176, 2178,
1173, 2201 and 2231, and not on the provisions of the Workmen's
Compensation Act. They point out that the complaint alleges gross and
brazen negligence on the part of Philex in failing to take the necessary
security for the protection of the lives of its employees working underground.
They also assert that since Philex opted to file a motion to dismiss in the
court a quo, the allegations in their complaint including those contained in the
annexes are deemed admitted.
In the second assignment of error, petitioners asseverate that respondent
Judge failed to see the distinction between the claims for compensation
under the Workmen's Compensation Act and the claims for damages based
on gross negligence of Philex under the Civil Code. They point out that
workmen's compensation refers to liability for compensation for loss resulting
from injury, disability or death of the working man through industrial accident

On the other hand, Philex asserts that work-connected injuries are

compensable exclusively under the provisions of Sections 5 and 46 of the
Workmen's Compensation Act, which read:
SEC. 5. Exclusive right to compensation.The rights and
remedies granted by this Act to an employee by reason of a
personal injury entitling him to compensation shall exclude
all other rights and remedies accruing to the employee, his
personal representatives, dependents or nearest of kin
against the employer under the Civil Code and other laws
because of said injury ...
SEC. 46. Jurisdiction. The Workmen's Compensation
Commissioner shall have exclusive jurisdiction to hear and
decide claims for compensation under the Workmen's
Compensation Act, subject to appeal to the Supreme
Court, ...
Philex cites the case of Manalo vs. Foster Wheeler (98 Phil. 855 [1956])
where it was held that "all claims of workmen against their employer for
damages due to accident suffered in the course of employment shall be
investigated and adjudicated by the Workmen's Compensation Commission,"
subject to appeal to the Supreme Court.
Philex maintains that the fact that an employer was negligent, does not
remove the case from the exclusive character of recoveries under the
Workmen's Compensation Act; because Section 4-A of the Act provides an
additional compensation in case the employer fails to comply with the
requirements of safety as imposed by law to prevent accidents. In fact, it
points out that Philex voluntarily paid the compensation due the petitioners
and all the payments have been accepted in behalf of the deceased miners,
except the heirs of Nazarito Floresca who insisted that they are entitled to a
greater amount of damages under the Civil Code.

In the hearing of this case, then Undersecretary of Labor Israel Bocobo, then
Atty. Edgardo Angara, now President of the University of the Philippines,
Justice Manuel Lazaro, as corporate counsel and Assistant General Manager
of the GSIS Legal Affairs Department, and Commissioner on Elections,
formerly UP Law Center Director Froilan Bacungan, appeared as amici
curiae and thereafter, submitted their respective memoranda.
The issue to be resolved as WE stated in the resolution of November 26,
1976, is:
Whether the action of an injured employee or worker or that
of his heirs in case of his death under the Workmen's
Compensation Act is exclusive, selective or cumulative, that
is to say, whether his or his heirs' action is exclusively
restricted to seeking the limited compensation provided
under the Workmen's Compensation Act or whether they
have a right of selection or choice of action between availing
of the worker's right under the Workmen's Compensation Act
and suing in the regular courts under the Civil Code for
higher damages (actual, moral and/or exemplary) from the
employer by virtue of negligence (or fault) of the employer or
of his other employees or whether they may avail
cumulatively of both actions, i.e., collect the limited
compensation under the Workmen's Compensation Act and
sue in addition for damages in the regular courts.
There are divergent opinions in this case. Justice Lazaro is of the opinion
that an injured employee or worker, or the heirs in case of his death, may
initiate a complaint to recover damages (not compensation under the
Workmen's Compensation Act) with the regular court on the basis of
negligence of an employer pursuant to the Civil Code provisions. Atty. Angara
believes otherwise. He submits that the remedy of an injured employee for
work-connected injury or accident is exclusive in accordance with Section 5
of the Workmen's Compensation Act, while Atty. Bacungan's position is that
the action is selective. He opines that the heirs of the employee in case of his
death have a right of choice to avail themselves of the benefits provided
under the Workmen's Compensation Act or to sue in the regular court under
the Civil Code for higher damages from the employer by virtue of negligence
of the latter. Atty. Bocobo's stand is the same as that of Atty. Bacungan and
adds that once the heirs elect the remedy provided for under the Act, they

are no longer entitled to avail themselves of the remedy provided for under
the Civil Code by filing an action for higher damages in the regular court, and
vice versa.
On August 3, 1978, petitioners-heirs of deceased employee Nazarito
Floresca filed a motion to dismiss on the ground that they have amicably
settled their claim with respondent Philex. In the resolution of September 7,
1978, WE dismissed the petition only insofar as the aforesaid petitioners are
connected, it appearing that there are other petitioners in this case.
WE hold that the former Court of First Instance has jurisdiction to try the
case,
It should be underscored that petitioners' complaint is not for compensation
based on the Workmen's Compensation Act but a complaint for damages
(actual, exemplary and moral) in the total amount of eight hundred twentyfive thousand (P825,000.00) pesos. Petitioners did not invoke the provisions
of the Workmen's Compensation Act to entitle them to compensation
thereunder. In fact, no allegation appeared in the complaint that the
employees died from accident arising out of and in the course of their
employments. The complaint instead alleges gross and reckless negligence
and deliberate failure on the part of Philex to protect the lives of its workers
as a consequence of which a cave-in occurred resulting in the death of the
employees working underground. Settled is the rule that in ascertaining
whether or not the cause of action is in the nature of workmen's
compensation claim or a claim for damages pursuant to the provisions of the
Civil Code, the test is the averments or allegations in the complaint
(Belandres vs. Lopez Sugar Mill, Co., Inc., 97 Phil. 100).
In the present case, there exists between Philex and the deceased
employees a contractual relationship. The alleged gross and reckless
negligence and deliberate failure that amount to bad faith on the part of
Philex, constitute a breach of contract for which it may be held liable for
damages. The provisions of the Civil Code on cases of breach of contract
when there is fraud or bad faith, read:
Art. 2232. In contracts and quasi-contracts, the court may
award exemplary damages if the defendant acted in a
wanton, fraudulent, reckless, oppressive or malevolent
manner.

Art. 2201. In contracts and quasi-contracts, the damages for

which the obligor who acted in good faith is able shall be
those that are the natural and probable consequences of the
breach of the obligation, and which the parties have
foreseen or could have reasonably foreseen at the time the
obligation was constituted.
In cases of fraud, bad faith, malice or wanton attitude, the
obligor shall be responsible for all damages which may be
reasonably attributed to the non-performance of the
obligation.
Furthermore, Articles 2216 et seq., Civil Code, allow the payment of all kinds
of damages, as assessed by the court.
The rationale in awarding compensation under the Workmen's Compensation
Act differs from that in giving damages under the Civil Code. The
compensation acts are based on a theory of compensation distinct from the
existing theories of damages, payments under the acts being made as
compensation and not as damages (99 C.J.S. 53). Compensation is given to
mitigate the harshness and insecurity of industrial life for the workman and
his family. Hence, an employer is liable whether negligence exists or not
since liability is created by law. Recovery under the Act is not based on any
theory of actionable wrong on the part of the employer (99 C.J.S. 36).
In other words, under the compensation acts, the employer is liable to pay
compensation benefits for loss of income, as long as the death, sickness or
injury is work-connected or work-aggravated, even if the death or injury is not
due to the fault of the employer (Murillo vs. Mendoza, 66 Phil. 689). On the
other hand, damages are awarded to one as a vindication of the wrongful
invasion of his rights. It is the indemnity recoverable by a person who has
sustained injury either in his person, property or relative rights, through the
act or default of another (25 C.J.S. 452).
The claimant for damages under the Civil Code has the burden of proving the
causal relation between the defendant's negligence and the resulting injury
as well as the damages suffered. While under the Workmen's Compensation
Act, there is a presumption in favor of the deceased or injured employee that
the death or injury is work-connected or work-aggravated; and the employer
has the burden to prove otherwise (De los Angeles vs. GSIS, 94 SCRA 308;

Carino vs. WCC, 93 SCRA 551; Maria Cristina Fertilizer Corp. vs. WCC, 60
SCRA 228).
The claim of petitioners that the case is not cognizable by the Workmen's
Compensation Commission then, now Employees Compensation
Commission, is strengthened by the fact that unlike in the Civil Code, the
Workmen's Compensation Act did not contain any provision for an award of
actual, moral and exemplary damages. What the Act provided was merely
the right of the heirs to claim limited compensation for the death in the
amount of six thousand (P6,000.00) pesos plus burial expenses of two
hundred (P200.00) pesos, and medical expenses when incurred (Sections 8,
12 and 13, Workmen's Compensation Act), and an additional compensation
of only 50% if the complaint alleges failure on the part of the employer to
"install and maintain safety appliances or to take other precautions for the
prevention of accident or occupational disease" (Section 4-A, Ibid.). In the
case at bar, the amount sought to be recovered is over and above that which
was provided under the Workmen's Compensation Act and which cannot be
granted by the Commission.
Moreover, under the Workmen's Compensation Act, compensation benefits
should be paid to an employee who suffered an accident not due to the
facilities or lack of facilities in the industry of his employer but caused by
factors outside the industrial plant of his employer. Under the Civil Code, the
liability of the employer, depends on breach of contract or tort. The
Workmen's Compensation Act was specifically enacted to afford protection to
the employees or workmen. It is a social legislation designed to give relief to
the workman who has been the victim of an accident causing his death or
ailment or injury in the pursuit of his employment (Abong vs. WCC, 54 SCRA
379).
WE now come to the query as to whether or not the injured employee or his
heirs in case of death have a right of selection or choice of action between
availing themselves of the worker's right under the Workmen's Compensation
Act and suing in the regular courts under the Civil Code for higher damages
(actual, moral and exemplary) from the employers by virtue of that
negligence or fault of the employers or whether they may avail themselves
cumulatively of both actions, i.e., collect the limited compensation under the
Workmen's Compensation Act and sue in addition for damages in the regular
courts.

In disposing of a similar issue, this Court in Pacana vs. Cebu Autobus

Company, 32 SCRA 442, ruled that an injured worker has a choice of either
to recover from the employer the fixed amounts set by the Workmen's
Compensation Act or to prosecute an ordinary civil action against the
tortfeasor for higher damages but he cannot pursue both courses of action
simultaneously.
In Pacaa WE said:
In the analogous case of Esguerra vs. Munoz Palma,
involving the application of Section 6 of the Workmen's
Compensation Act on the injured workers' right to sue thirdparty tortfeasors in the regular courts, Mr. Justice J.B.L.
Reyes, again speaking for the Court, pointed out that the
injured worker has the choice of remedies but cannot pursue
both courses of action simultaneously and thus balanced the
relative advantage of recourse under the Workmen's
Compensation Act as against an ordinary action.
As applied to this case, petitioner Esguerra cannot maintain
his action for damages against the respondents (defendants
below), because he has elected to seek compensation under
the Workmen's Compensation Law, and his claim (case No.
44549 of the Compensation Commission) was being
processed at the time he filed this action in the Court of First
Instance. It is argued for petitioner that as the damages
recoverable under the Civil Code are much more extensive
than the amounts that may be awarded under the
Workmen's Compensation Act, they should not be deemed
incompatible. As already indicated, the injured laborer was
initially free to choose either to recover from the employer
the fixed amounts set by the Compensation Law or else, to
prosecute an ordinary civil action against the tortfeasor for
higher damages. While perhaps not as profitable, the smaller
indemnity obtainable by the first course is balanced by the
claimant's being relieved of the burden of proving the causal
connection between the defendant's negligence and the
resulting injury, and of having to establish the extent of the
damage suffered; issues that are apt to be troublesome to
establish satisfactorily. Having staked his fortunes on a

particular remedy, petitioner is precluded from pursuing the

alternate course, at least until the prior claim is rejected by
the Compensation Commission. Anyway, under the proviso
of Section 6 aforequoted, if the employer Franklin Baker
Company recovers, by derivative action against the alleged
tortfeasors, a sum greater than the compensation he may
have paid the herein petitioner, the excess accrues to the
latter.
Although the doctrine in the case of Esguerra vs. Munoz Palma (104 Phil.
582), applies to third-party tortfeasor, said rule should likewise apply to the
employer-tortfeasor.
Insofar as the heirs of Nazarito Floresca are concerned, as already stated,
the petition has been dismissed in the resolution of September 7, 1978 in
view of the amicable settlement reached by Philex and the said heirs.
With regard to the other petitioners, it was alleged by Philex in its motion to
dismiss dated May 14, 1968 before the court a quo, that the heirs of the
deceased employees, namely Emerito Obra, Larry Villar, Jr., Aurelio Lanuza,
Lorenzo Isla and Saturnino Martinez submitted notices and claims for
compensation to the Regional Office No. 1 of the then Department of Labor
and all of them have been paid in full as of August 25, 1967, except
Saturnino Martinez whose heirs decided that they be paid in installments (pp.
106-107, rec.). Such allegation was admitted by herein petitioners in their
opposition to the motion to dismiss dated May 27, 1968 (pp. 121-122, rec.) in
the lower court, but they set up the defense that the claims were filed under
the Workmen's Compensation Act before they learned of the official report of
the committee created to investigate the accident which established the
criminal negligence and violation of law by Philex, and which report was
forwarded by the Director of Mines to the then Executive Secretary Rafael
Salas in a letter dated October 19, 1967 only (p. 76, rec.).
WE hold that although the other petitioners had received the benefits under
the Workmen's Compensation Act, such may not preclude them from
bringing an action before the regular court because they became cognizant
of the fact that Philex has been remiss in its contractual obligations with the
deceased miners only after receiving compensation under the Act. Had
petitioners been aware of said violation of government rules and regulations
by Philex, and of its negligence, they would not have sought redress under

the Workmen's Compensation Commission which awarded a lesser amount

for compensation. The choice of the first remedy was based on ignorance or
a mistake of fact, which nullifies the choice as it was not an intelligent choice.
The case should therefore be remanded to the lower court for further
proceedings. However, should the petitioners be successful in their bid
before the lower court, the payments made under the Workmen's
Compensation Act should be deducted from the damages that may be
decreed in their favor.
B
Contrary to the perception of the dissenting opinion, the Court does not
legislate in the instant case. The Court merely applies and gives effect to the
constitutional guarantees of social justice then secured by Section 5 of Article
11 and Section 6 of Article XIV of the 1935 Constitution, and now by Sections
6, 7, and 9 of Article 11 of the DECLARATION OF PRINCIPLES AND STATE
POLICIES of the 1973 Constitution, as amended, and as implemented by
Articles 2176, 2177, 2178, 1173, 2201, 2216, 2231 and 2232 of the New Civil
Code of 1950.
To emphasize, the 1935 Constitution declares that:
Sec. 5. The promotion of social justice to insure the wellbeing and economic security of all the people should be the
concern of the State (Art. II).
Sec. 6. The State shall afford protection to labor, especially
to working women, and minors, and shall regulate the
relations between landowner and tenant, and between labor
and capital in industry and in agriculture. The State may
provide for compulsory arbitration (Art. XIV).
The 1973 Constitution likewise commands the State to "promote social
justice to insure the dignity, welfare, and security of all the people "...
regulate the use ... and disposition of private property and equitably diffuse
property ownership and profits "establish, maintain and ensure adequate
social services in, the field of education, health, housing, employment,
welfare and social security to guarantee the enjoyment by the people of a
decent standard of living" (Sections 6 and 7, Art. II, 1973 Constitution);
"... afford protection to labor, ... and regulate the relations between workers

and employers ..., and assure the rights of workers to ... just and humane
conditions of work"(Sec. 9, Art. II, 1973 Constitution, emphasis supplied).
The foregoing constitutional guarantees in favor of labor institutionalized in
Section 9 of Article 11 of the 1973 Constitution and re-stated as a declaration
of basic policy in Article 3 of the New Labor Code, thus:
Art. 3. Declaration of basic policy.The State shall afford
protection to labor, promote full employment, ensure equal
work opportunities regardless of sex, race or creed,
and regulate the relations between workers and
employers. The State shall assure the rights of workers to
self-organization, collective bargaining, security of tenure,
and just and humane conditions of work. (emphasis
supplied).
The aforestated constitutional principles as implemented by the
aforementioned articles of the New Civil Code cannot be impliedly repealed
by the restrictive provisions of Article 173 of the New Labor Code. Section 5
of the Workmen's Compensation Act (before it was amended by R.A. No.
772 on June 20, 1952), predecessor of Article 173 of the New Labor Code,
has been superseded by the aforestated provisions of the New Civil Code, a
subsequent law, which took effect on August 30, 1950, which obey the
constitutional mandates of social justice enhancing as they do the rights of
the workers as against their employers. Article 173 of the New Labor Code
seems to diminish the rights of the workers and therefore collides with the
social justice guarantee of the Constitution and the liberal provisions of the
New Civil Code.
The guarantees of social justice embodied in Sections 6, 7 and 9 of Article II
of the 1973 Constitution are statements of legal principles to be applied and
enforced by the courts. Mr. Justice Robert Jackson in the case of West
Virginia State Board of Education vs. Barnette, with characteristic eloquence,
enunciated:
The very purpose of a Bill of Rights was to withdraw certain
subjects from the vicissitudes of political controversy, to
place them beyond the reach of majorities and officials and
to establish them as legal principles to be applied by the
courts. One's right to life, liberty, and property, to free

speech, a free press, freedom of worship and assembly, and

other fundamental rights may not be submitted to vote; they
depend on the outcome of no elections (319 U.S. 625, 638,
87 L.ed. 1638, emphasis supplied).
In case of any doubt which may be engendered by Article 173 of the New
Labor Code, both the New Labor Code and the Civil Code direct that the
doubts should be resolved in favor of the workers and employees.
Thus, Article 4 of the New Labor Code, otherwise known as Presidential
Decree No. 442, as amended, promulgated on May 1, 1974, but which took
effect six months thereafter, provides that "all doubts in the implementation
and interpretation of the provisions of this Code, including its implementing
rules and regulations, shall be resolved in favor of labor" (Art. 2, Labor
Code).
Article 10 of the New Civil Code states: "In case of doubt in the interpretation
or application of laws, it is presumed that the law-making body intended right
and justice to prevail. "
More specifically, Article 1702 of the New Civil Code likewise directs that. "In
case of doubt, all labor legislation and all labor contracts shall be construed
in favor of the safety and decent living of the laborer."
Before it was amended by Commonwealth Act No. 772 on June 20, 1952,
Section 5 of the Workmen's Compensation Act provided:
Sec. 5. Exclusive right to compensation.- The rights and
remedies granted by this Act to an employee by reason of a
personal injury entitling him to compensation shall exclude
all other rights and remedies accruing to the employee, his
personal representatives, dependents or nearest of kin
against the employer under the Civil Code and other laws,
because of said injury (emphasis supplied).
Employers contracting laborecsrs in the Philippine Islands
for work outside the same may stipulate with such laborers
that the remedies prescribed by this Act shall apply
exclusively to injuries received outside the Islands through
accidents happening in and during the performance of the

duties of the employment; and all service contracts made in

the manner prescribed in this section shall be presumed to
include such agreement.
Only the second paragraph of Section 5 of the Workmen's Compensation Act
No. 3428, was amended by Commonwealth Act No. 772 on June 20, 1952,
thus:
Sec. 5. Exclusive right to compensation.- The rights and
remedies granted by this Act to an employee by reason of a
personal injury entitling him to compensation shall exclude
all other rights and remedies accruing to the employee, his
personal representatives, dependents or nearest of kin
against the employer under the Civil Code and other laws,
because of said injury.
Employers contracting laborers in the Philippine Islands for
work outside the same shall stipulate with such laborers that
the remedies prescribed by this Act shall apply to injuries
received outside the Island through accidents happening in
and during the performance of the duties of the employment.
Such stipulation shall not prejudice the right of the laborers
to the benefits of the Workmen's Compensation Law of the
place where the accident occurs, should such law be more
favorable to them (As amended by section 5 of Republic Act
No. 772).
Article 173 of the New Labor Code does not repeal expressly nor impliedly
the applicable provisions of the New Civil Code, because said Article 173
provides:
Art. 173. Exclusiveness of liability.- Unless otherwise
provided, the liability of the State Insurance Fund under this
Title shall be exclusive and in place of all other liabilities of
the employer to the employee, his dependents or anyone
otherwise entitled to receive damages on behalf of the
employee or his dependents. The payment of compensation
under this Title shall bar the recovery of benefits as provided
for in Section 699 of the Revised Administrative Code,
Republic Act Numbered Eleven hundred sixty-one, as

amended, Commonwealth Act Numbered One hundred

eighty- six, as amended, Commonwealth Act Numbered Six
hundred ten, as amended, Republic Act Numbered Fortyeight hundred Sixty-four, as amended, and other laws whose
benefits are administered by the System during the period of
such payment for the same disability or death, and
conversely (emphasis supplied).
As above-quoted, Article 173 of the New Labor Code expressly repealed only
Section 699 of the Revised Administrative Code, R.A. No. 1161, as
amended, C.A. No. 186, as amended, R.A. No. 610, as amended, R.A. No.
4864, as amended, and all other laws whose benefits are administered by
the System (referring to the GSIS or SSS).
Unlike Section 5 of the Workmen's Compensation Act as aforequoted, Article
173 of the New Labor Code does not even remotely, much less expressly,
repeal the New Civil Code provisions heretofore quoted.
It is patent, therefore, that recovery under the New Civil Code for damages
arising from negligence, is not barred by Article 173 of the New Labor Code.
And the damages recoverable under the New Civil Code are not
administered by the System provided for by the New Labor Code, which
defines the "System" as referring to the Government Service Insurance
System or the Social Security System (Art. 167 [c], [d] and [e] of the New
Labor Code).
Furthermore, under Article 8 of the New Civil Code, decisions of the Supreme
Court form part of the law of the land.

Constitution form part of this jurisdiction's legal system.

These decisions, although in themselves not laws, constitute
evidence of what the laws mean. The application or
interpretation placed by the Court upon a law is part of the
law as of the date of the enactment of the said law since the
Court's application or interpretation merely establishes the
contemporaneous legislative intent that the construed law
purports to carry into effect" (65 SCRA 270, 272-273 [1975]).
WE ruled that judicial decisions of the Supreme Court assume the same
authority as the statute itself (Caltex vs. Palomer, 18 SCRA 247; 124 Phil.
763).
The aforequoted provisions of Section 5 of the Workmen's Compensation
Act, before and after it was amended by Commonwealth Act No. 772 on June
20, 1952, limited the right of recovery in favor of the deceased, ailing or
injured employee to the compensation provided for therein. Said Section 5
was not accorded controlling application by the Supreme Court in the 1970
case of Pacana vs. Cebu Autobus Company (32 SCRA 442) when WE ruled
that an injured worker has a choice of either to recover from the employer the
fixed amount set by the Workmen's Compensation Act or to prosecute an
ordinary civil action against the tortfeasor for greater damages; but he cannot
pursue both courses of action simultaneously. Said Pacana case penned by
Mr. Justice Teehankee, applied Article 1711 of the Civil Code as against the
Workmen's Compensation Act, reiterating the 1969 ruling in the case of
Valencia vs. Manila Yacht Club (28 SCRA 724, June 30,1969) and the 1958
case of Esguerra vs. Munoz Palma (104 Phil. 582), both penned by Justice
J.B.L. Reyes. Said Pacana case was concurred in by Justices J.B.L. Reyes,
Dizon, Makalintal, Zaldivar, Castro, Fernando and Villamor.

Article 8 of the New Civil Code provides:

Art. 8. Judicial decisions applying or interpreting the laws or
the Constitution shall form a part of the legal system of the
Philippines.
The Court, through the late Chief Justice Fred Ruiz Castro, in People vs.
Licera ruled:
Article 8 of the Civil Code of the Philippines decrees that
judicial decisions applying or interpreting the laws or the

Since the first sentence of Article 173 of the New Labor Code is merely a restatement of the first paragraph of Section 5 of the Workmen's Compensation
Act, as amended, and does not even refer, neither expressly nor impliedly, to
the Civil Code as Section 5 of the Workmen's Compensation Act did, with
greater reason said Article 173 must be subject to the same interpretation
adopted in the cases of Pacana, Valencia and Esguerra aforementioned as
the doctrine in the aforesaid three (3) cases is faithful to and advances the
social justice guarantees enshrined in both the 1935 and 1973 Constitutions.

It should be stressed likewise that there is no similar provision on social

justice in the American Federal Constitution, nor in the various state
constitutions of the American Union. Consequently, the restrictive nature of
the American decisions on the Workmen's Compensation Act cannot limit the
range and compass of OUR interpretation of our own laws, especially Article
1711 of the New Civil Code, vis-a-vis Article 173 of the New Labor Code, in
relation to Section 5 of Article II and Section 6 of Article XIV of the 1935
Constitution then, and now Sections 6, 7 and 9 of the Declaration of
Principles and State Policies of Article II of the 1973 Constitution.
The dissent seems to subordinate the life of the laborer to the property rights
of the employer. The right to life is guaranteed specifically by the due process
clause of the Constitution. To relieve the employer from liability for the death
of his workers arising from his gross or wanton fault or failure to provide
safety devices for the protection of his employees or workers against the
dangers which are inherent in underground mining, is to deprive the
deceased worker and his heirs of the right to recover indemnity for the loss of
the life of the worker and the consequent loss to his family without due
process of law. The dissent in effect condones and therefore encourages
such gross or wanton neglect on the part of the employer to comply with his
legal obligation to provide safety measures for the protection of the life, limb
and health of his worker. Even from the moral viewpoint alone, such attitude
is un-Christian.
It is therefore patent that giving effect to the social justice guarantees of the
Constitution, as implemented by the provisions of the New Civil Code, is not
an exercise of the power of law-making, but is rendering obedience to the
mandates of the fundamental law and the implementing legislation
aforementioned.

Encyclopedia, Vol. 21, p. 93, 1964), which has been discarded soon after the
close of the 18th century due to the Industrial Revolution that generated the
machines and other mechanical devices (beginning with Eli Whitney's cotton
gin of 1793 and Robert Fulton's steamboat of 1807) for production and
transportation which are dangerous to life, limb and health. The old sociopolitical-economic philosophy of live-and-let-live is now superdesed by the
benign Christian shibboleth of live-and-help others to live. Those who profess
to be Christians should not adhere to Cain's selfish affirmation that he is not
his brother's keeper. In this our civilization, each one of us is our brother's
keeper. No man is an island. To assert otherwise is to be as atavistic and
ante-deluvian as the 1837 case of Prisley vs. Fowler (3 MN 1,150 reprint
1030) invoked by the dissent, The Prisley case was decided in 1837 during
the era of economic royalists and robber barons of America. Only ruthless,
unfeeling capitalistics and egoistic reactionaries continue to pay obeisance to
such un-Christian doctrine. The Prisley rule humiliates man and debases
him; because the decision derisively refers to the lowly worker as "servant"
and utilizes with aristocratic arrogance "master" for "employer." It robs man of
his inherent dignity and dehumanizes him. To stress this affront to human
dignity, WE only have to restate the quotation from Prisley, thus: "The mere
relation of the master and the servant never can imply an obligation on the
part of the master to take more care of the servant than he may reasonably
be expected to do himself." This is the very selfish doctrine that provoked the
American Civil War which generated so much hatred and drew so much
precious blood on American plains and valleys from 1861 to 1864.
"Idolatrous reverence" for the letter of the law sacrifices the human being.
The spirit of the law insures man's survival and ennobles him. In the words of
Shakespeare, "the letter of the law killeth; its spirit giveth life."
C

The Court, to repeat, is not legislating in the instant case.

It is axiomatic that no ordinary statute can override a constitutional provision.
The words of Section 5 of the Workmen's Compensation Act and of Article
173 of the New Labor Code subvert the rights of the petitioners as surviving
heirs of the deceased mining employees. Section 5 of the Workmen's
Compensation Act and Article 173 of the New Labor Code are retrogressive;
because they are a throwback to the obsolete laissez-faire doctrine of Adam
Smith enunciated in 1776 in his treatise Wealth of Nations (Collier's

It is curious that the dissenting opinion clings to the myth that the courts
cannot legislate.
That myth had been exploded by Article 9 of the New Civil Code, which
provides that "No judge or court shall decline to render judgment by reason
of the silence, obscurity or insufficiency of the laws. "
Hence, even the legislator himself, through Article 9 of the New Civil Code,
recognizes that in certain instances, the court, in the language of Justice

Holmes, "do and must legislate" to fill in the gaps in the law; because the
mind of the legislator, like all human beings, is finite and therefore cannot
envisage all possible cases to which the law may apply Nor has the human
mind the infinite capacity to anticipate all situations.
But about two centuries before Article 9 of the New Civil Code, the founding
fathers of the American Constitution foresaw and recognized the eventuality
that the courts may have to legislate to supply the omissions or to clarify the
ambiguities in the American Constitution and the statutes.
'Thus, Alexander Hamilton pragmatically admits that judicial legislation may
be justified but denies that the power of the Judiciary to nullify statutes may
give rise to Judicial tyranny (The Federalist, Modern Library, pp. 503-511,
1937 ed.). Thomas Jefferson went farther to concede that the court is even
independent of the Nation itself (A.F.L. vs. American Sash Company, 1949
335 US 538).
Many of the great expounders of the American Constitution likewise share
the same view. Chief Justice Marshall pronounced: "It is emphatically the
province and duty of the Judicial department to say what the law is (Marbury
vs. Madison I Cranch 127 1803), which was re-stated by Chief Justice
Hughes when he said that "the Constitution is what the judge says it is
(Address on May 3, 1907, quoted by President Franklin Delano Roosevelt on
March 9, 1937). This was reiterated by Justice Cardozo who pronounced that
"No doubt the limits for the judge are narrower. He legislates only between
gaps. He fills the open spaces in the law. " (The Nature of the Judicial
Process, p. 113). In the language of Chief Justice Harlan F. Stone, "The only
limit to the judicial legislation is the restraint of the judge" (U.S. vs. Butler 297
U.S. 1 Dissenting Opinion, p. 79), which view is also entertained by Justice
Frankfurter and Justice Robert Jackson. In the rhetoric of Justice Frankfurter,
"the courts breathe life, feeble or strong, into the inert pages of the
Constitution and all statute books."
It should be stressed that the liability of the employer under Section 5 of the
Workmen's Compensation Act or Article 173 of the New Labor Code is limited
to death, ailment or injury caused by the nature of the work, without any fault
on the part of the employers. It is correctly termed no fault liability. Section 5
of the Workmen's Compensation Act, as amended, or Article 173 of the New
Labor Code, does not cover the tortious liability of the employer occasioned
by his fault or culpable negligence in failing to provide the safety devices

required by the law for the protection of the life, limb and health of the
workers. Under either Section 5 or Article 173, the employer remains liable to
pay compensation benefits to the employee whose death, ailment or injury is
work-connected, even if the employer has faithfully and diligently furnished
all the safety measures and contrivances decreed by the law to protect the
employee.
The written word is no longer the "sovereign talisman." In the epigrammatic
language of Mr. Justice Cardozo, "the law has outgrown its primitive stage of
formalism when the precise word was the sovereign talisman, and every slip
was fatal" (Wood vs. Duff Gordon 222 NW 88; Cardozo, The Nature of the
Judicial Process 100). Justice Cardozo warned that: "Sometimes the
conservatism of judges has threatened for an interval to rob the legislation of
its efficacy. ... Precedents established in those items exert an unhappy
influence even now" (citing Pound, Common Law and Legislation 21 Harvard
Law Review 383, 387).
Finally, Justice Holmes delivered the coup de grace when he pragmatically
admitted, although with a cautionary undertone: "that judges do and must
legislate, but they can do so only interstitially they are confined from molar to
molecular motions" (Southern Pacific Company vs. Jensen, 244 US 204
1917). And in the subsequent case of Springer vs. Government (277 US 188,
210-212, 72 L.ed. 845, 852- 853), Justice Holmes pronounced:
The great ordinances of the Constitution do not establish
and divide fields of black and white. Even the more specific
of them are found to terminate in a penumbra shading
gradually from one extreme to the other. x x x. When we
come to the fundamental distinctions it is still more obvious
that they must be received with a certain latitude or our
government could not go on.
To make a rule of conduct applicable to an individual who
but for such action would be free from it is to legislate yet it
is what the judges do whenever they determine which of two
competing principles of policy shall prevail.
xxx xxx xxx

It does not seem to need argument to show that however we

may disguise it by veiling words we do not and cannot carry
out the distinction between legislative and executive action
with mathematical precision and divide the branches into
waterlight compartments, were it ever so desirable to do so,
which I am far from believing that it is, or that the
Constitution requires.
True, there are jurists and legal writers who affirm that judges should not
legislate, but grudgingly concede that in certain cases judges do legislate.
They criticize the assumption by the courts of such law-making power as
dangerous for it may degenerate into Judicial tyranny. They include
Blackstone, Jeremy Bentham, Justice Black, Justice Harlan, Justice Roberts,
Justice David Brewer, Ronald Dworkin, Rolf Sartorious, Macklin Fleming and
Beryl Harold Levy. But said Justices, jurists or legal commentators, who
either deny the power of the courts to legislate in-between gaps of the law, or
decry the exercise of such power, have not pointed to examples of the
exercise by the courts of such law-making authority in the interpretation and
application of the laws in specific cases that gave rise to judicial tyranny or
oppression or that such judicial legislation has not protected public interest or
individual welfare, particularly the lowly workers or the underprivileged.
On the other hand, there are numerous decisions interpreting the Bill of
Rights and statutory enactments expanding the scope of such provisions to
protect human rights. Foremost among them is the doctrine in the cases of
Miranda vs. Arizona (384 US 436 1964), Gideon vs. Wainright (372 US 335),
Escubedo vs. Illinois (378 US 478), which guaranteed the accused under
custodial investigation his rights to remain silent and to counsel and to be
informed of such rights as even as it protects him against the use of force or
intimidation to extort confession from him. These rights are not found in the
American Bill of Rights. These rights are now institutionalized in Section 20,
Article IV of the 1973 Constitution. Only the peace-and-order adherents were
critical of the activism of the American Supreme Court led by Chief Justice
Earl Warren.
Even the definition of Identical offenses for purposes of the double jeopardy
provision was developed by American judicial decisions, not by amendment
to the Bill of Rights on double jeopardy (see Justice Laurel in People vs.
Tarok, 73 Phil. 260, 261-268). And these judicial decisions have been restated in Section 7 of Rule 117 of the 1985 Rules on Criminal Procedure, as

well as in Section 9 of Rule 117 of the 1964 Revised Rules of Court. In both
provisions, the second offense is the same as the first offense if the second
offense is an attempt to commit the first or frustration thereof or necessarily
includes or is necessarily included in the first offense.
The requisites of double jeopardy are not spelled out in the Bill of Rights.
They were also developed by judicial decisions in the United States and in
the Philippines even before people vs. Ylagan (58 Phil. 851-853).
Again, the equal protection clause was interpreted in the case of Plessy vs.
Ferguson (163 US 537) as securing to the Negroes equal but separate
facilities, which doctrine was revoked in the case of Brown vs. Maryland
Board of Education (349 US 294), holding that the equal protection clause
means that the Negroes are entitled to attend the same schools attended by
the whites-equal facilities in the same school-which was extended to public
parks and public buses.
De-segregation, not segregation, is now the governing principle.
Among other examples, the due process clause was interpreted in the case
of People vs. Pomar (46 Phil. 440) by a conservative, capitalistic court to
invalidate a law granting maternity leave to working women-according
primacy to property rights over human rights. The case of People vs. Pomar
is no longer the rule.
As early as 1904, in the case of Lochner vs. New York (198 US 45, 76, 49 L.
ed. 937, 949), Justice Holmes had been railing against the conservatism of
Judges perverting the guarantee of due process to protect property rights as
against human rights or social justice for the working man. The law fixing
maximum hours of labor was invalidated. Justice Holmes was vindicated
finally in 1936 in the case of West Coast Hotel vs. Parish (300 US 377-79; 81
L. ed. 703) where the American Supreme Court upheld the rights of workers
to social justice in the form of guaranteed minimum wage for women and
minors, working hours not exceeding eight (8) daily, and maternity leave for
women employees.
The power of judicial review and the principle of separation of powers as well
as the rule on political questions have been evolved and grafted into the
American Constitution by judicial decisions (Marbury vs. Madison, supra

Coleman vs. Miller, 307 US 433, 83 L. ed. 1385; Springer vs. Government,
277 US 210-212, 72 L. ed. 852, 853).

MELENCIO-HERRERA, J., dissenting:

A

It is noteworthy that Justice Black, who seems to be against judicial

legislation, penned a separate concurring opinion in the case of Coleman vs.
Miller, supra, affirming the doctrine of political question as beyond the ambit
of judicial review. There is nothing in both the American and Philippine
Constitutions expressly providing that the power of the courts is limited by the
principle of separation of powers and the doctrine on political questions.
There are numerous cases in Philippine jurisprudence applying the doctrines
of separation of powers and political questions and invoking American
precedents.
Unlike the American Constitution, both the 1935 and 1973 Philippine
Constitutions expressly vest in the Supreme Court the power to review the
validity or constitutionality of any legislative enactment or executive act.
WHEREFORE, THE TRIAL COURT'S ORDER OF DISMISSAL IS HEREBY
REVERSED AND SET ASIDE AND THE CASE IS REMANDED TO IT FOR
FURTHER PROCEEDINGS. SHOULD A GREATER AMOUNT OF
DAMAGES BE DECREED IN FAVOR OF HEREIN PETITIONERS, THE
PAYMENTS ALREADY MADE TO THEM PURSUANT TO THE
WORKMEN'S COMPENSATION ACT SHALL BE DEDUCTED. NO COSTS.
SO ORDERED.
Fernando, C.J., Teehankee, Plana, Escolin, De la Fuente, Cuevas and
Alampay JJ., concur.
Concepcion, Jr., J., is on leave.
Abad Santos and Relova, JJ., took no part.

This case involves a complaint for damages for the death of five employees
of PHILEX Mining Corporation under the general provisions of the Civil Code.
The Civil Code itself, however, provides for its non-applicability to the
complaint. It is specifically provided in Article 2196 of the Code, found in Title
XVIII-Damages that:
COMPENSATION FOR WORKMEN AND OTHER
EMPLOYEES IN CASE OF DEATH, INJURY OR
ILLNESS IS REGULATED BY SPECIAL LAWS.
Compensation and damages are synonymous. In Esguerra vs. Muoz
Palma, etc., et al., 104 Phil. 582, 586, Justice J.B.L. Reyes had said:
Petitioner also avers that compensation is not damages. This
argument is but a play on words. The term compensation' is
used in the law (Act 3812 and Republic Act 772) in the sense
of indemnity for damages suffered, being awarded for a
personal injury caused or aggravated by or in the course of
employment. ...
By the very provisions of the Civil Code, it is a "special law", not the Code
itself, which has to apply to the complaint involved in the instant case. That
"special law", in reference to the complaint, can be no other than the
Workmen's Compensation
Even assuming, without conceding, that an employee is entitled to an
election of remedies, as the majority rules, both options cannot be exercised
simultaneously, and the exercise of one will preclude the exercise of the
other. The petitioners had already exercised their option to come under the
Workmen's Compensation Act, and they have already received
compensation payable to them under that Act. Stated differently, the remedy
under the Workmen's Compensation Act had already become a "finished
transaction".

Separate Opinions
There are two considerations why it is believed petitioners should no longer
be allowed to exercise the option to sue under the Civil Code. In the first

place, the proceedings under the Workmen's Compensation Act have already
become the law in regards to" the "election of remedies", because those
proceedings had become a "finished transaction".

Compensation is not payable when injury is due to

employee's willful intention to injure himself or another or to
his intoxication. (Sec. 7482, S.S., p. 713.)

In the second place, it should be plainly equitable that, if a person entitled to

an "election of remedies" makes a first election and accepts the benefits
thereof, he should no longer be allowed to avail himself of the second option.
At the very least, if he wants to make a second election, in disregard of the
first election he has made, when he makes the second election he should
surrender the benefits he had obtained under the first election, This was not
done in the case before the Court.

When the act is applicable the remedy thereunder is

exclusive (Sec. 7483, S.S., p. 714.)
2. In providing for exclusiveness of the remedy under our Workmen's
Compensation Act, the Philippine Legislature worded the first paragraph of
Section 5 of the Act as follows:
SEC. 5. Exclusive right to compensation.-The rights and
remedies granted by this Act to an employee

B.
'There is full concurrence on my part with the dissenting opinion of Mr.
Justice Gutierrez upholding "the exclusory provision of the Workmen's
Compensation Act." I may further add:
1. The Workmen's Compensation Act (Act No. 3428) was approved on
December 10, 1927 and took effect on June 10, 1928. It was patterned from
Minnesota and Hawaii statutes.
Act No. 3428 was adopted by the Philippine legislature, in
Spanish and some sections of the law were taken from the
statutes of Minnesota and Hawaii, (Chapter 209 of the
Revised Laws of Hawaii, 1925). [Morabe & Inton, Workmen's
Compensation Act, p. 2]
Under the Workmen's Compensation Act of Hawaii, when the Act is
applicable, the remedy under the Act is exclusive The following is stated in 1
Schneider Workmen's Compensation Text, pp. 266, 267.
Sec. 112. Hawaii
Statutory Synopsis. The act is compulsory as to employees
in 'all industrial employment' and employees of the territory
and its political subdivisions. (Sections 7480-7481, S.S., Vol.
1, p. 713.)

by reason of a personal injury entitling him to compensation

shall exclude all other rights and remedies accruing to the
employee, his personal representatives, dependents or
nearest of kin against the employer
under the Civil Code and other laws, because of said injury
(Paragraphing and emphasis supplied)
In regards to the intent of the Legislature under the foregoing provision:
A cardinal rule in the interpretation of statutes is that the
meaning and intention of the law-making body must be
sought, first of all in the words of the statute itself, read and
considered in their natural, ordinary, commonly-accepted
and most obvious significations, according to good and
approved usage and without resorting to forced or subtle
construction Courts, therefore, as a rule, cannot presume
that the law-making body does not know the meaning of
words and the rules of grammar. Consequently, the
grammatical reading of a statute must be presumed to yield
its correct sense. (Espino vs. Cleofe 52 SCRA 92, 98) [Italics
supplied]
3. The original second paragraph of Section 5 provided:

Employers contracting laborers in the Philippine Islands for

work outside the same shall stipulate with such laborers that
the remedies prescribed by this Act shall apply exclusively to
injuries received outside the Islands through accidents
happening in and during the performance of the duties of the
employment. (Italics supplied)
The use of the word "exclusively is a further confirmation of the exclusory
provision of the Act, subject only to exceptions which may be provided in the
Act itself.
4. It might be mentioned that, within the Act itself, provision is made for
remedies other than within the Act itself. Thus, Section 6, in part, provides:
SEC. 6. Liability of third parties.-In case an employee suffers
an injury for which compensation is due under this Act by
any other person besides his employer, it shall be optional
with such injured employee either to claim compensation
from his employer, under this Act, or sue such other person
for damages, in accordance with law; ... (Emphasis supplied)
If the legislative intent under the first paragraph of Section 5 were to allow the
injured employee to sue his employer under the Civil Code, the legislator
could very easily have formulated the said first paragraph of Section 5
according to the pattern of Section 6. That that was not done shows the
legislative intent not to allow any option to an employee to sue the employer
under the Civil Code for injuries compensable under the Act.
5. There should be no question but that the original first paragraph of Section
5 of the Workmen's Compensation Act, formulated in 1927, provided that an
injured worker or employee, or his heirs, if entitled to compensation under the
Act, cannot have independent recourse neither to the Civil Code nor to any
other law relative to the liability of the employer. After 1927, there were
occasions when the legislator had the opportunity to amend the first
paragraph of Section 5 such that the remedies under the Act would not be
exclusive; yet, the legislator refrained from doing so. That shows the
legislatives continuing intent to maintain the exclusory provision of the first
paragraph of Section 5 unless otherwise provided in the Act itself.
(a) The original second paragraph of Section 5 provided:

Employers contracting laborers in the Philippine Islands for

work outside the same shall stipulate with such laborers that
the remedies prescribed by this Act shall apply (exclusively)
to injuries received outside the Islands through accidents
happening in and during the performance of the duties of the
employment (and all service contracts made in the manner
prescribed in this section be presumed to include such
agreement).
On June 20, 1952, through RA 772, the foregoing second paragraph was
amended with the elimination of the underlined words in parentheses, and
the addition of this sentence at the end of the paragraph:
Such stipulation shall not prejudice the right of the laborers
to the benefits of the Workmen's Compensation Law of the
place where the accident occurs, should such law be more
favorable to them. (Emphasis supplied)
It will be seen that, within the Act itself, the exclusory character of the Act was
amended. At that time, if he had so desired, the legislator could have
amended the first paragraph of Section 5 so that the employee would have
the option to sue the employer under the Act, or under the Civil Code, should
the latter be more favorable to him.
(b) The Workmen's Compensation Act, which took effect in 1927, grants
compensation to an injured employee without regard to the presence or
absence of negligence on the part of the employer. The compensation is
deemed an expense chargeable to the industry (Murillo vs. Mendoza, 66
Phil. 689 [1938]).
In time, it must have been thought that it was inequitable to have the amount
of compensation, caused by negligence on the part of the employer, to be the
same amount payable when the employer was not negligent. Based on that
thinking, Section 4-A 1 was included into the Act, on June 20, 1952, through
RA 772. Said Section 4-A increased the compensation payable by 50% in
case there was negligence on the part of the employer. That additional
section evidenced the intent of the legislator not to give an option to an
employee, injured with negligence on the part of the employer, to sue the
latter under the provisions of the Civil Code.

On June 20, 1964, Section 4-A was amended (insubstantially) by RA 4119.

The legislator was again given the opportunity to provide, but he did not, the
option to an employee to sue under the Act or under the Civil Code.
When a Court gives effect to a statute not in accordance with the intent of the
law-maker, the Court is unjustifiably legislating.
It is in view of the foregoing that I vote for affirmation of the trial Court's
dismissal of the Complaint.
GUTIERREZ, JR., J., dissenting:
To grant the petition and allow the victims of industrial accidents to file
damages suits based on torts would be a radical innovation not only contrary
to the express provisions of the Workmen's Compensation Act but a
departure from the principles evolved in the long history of workmen's
compensation. At the very least, it should be the legislature and not this
Court which should remove the exclusory provision of the Workmen's
Compensation Act, a provision reiterated in the present Labor Code on
employees' compensation.
Workmen's compensation evolved to remedy the evils associated with the
situation in the early years of the industrial revolution when injured
workingmen had to rely on damage suits to get recompense.
Before workmen's compensation, an injured worker seeking damages would
have to prove in a tort suit that his employer was either negligent or in bad
faith, that his injury was caused by the employer and not a fellow worker, and
that he was not guilty of contributory negligence. The employer could employ
not only his wealth in defeating the claim for damages but a host of common
law defenses available to him as well. The worker was supposed to know
what he entered into when he accepted employment. As stated in the leading
case of Priestley u. Fowler (3 M. & W. 1, 150 Reprint 1030) decided in 1837
"the mere relation of the master and the servant never can imply an
obligation on the part of the master to take more care of the servant than he
may reasonably be expected to do of himself." By entering into a contract of
employment, the worker was deemed to accept the risks of employment that
he should discover and guard against himself.

The problems associated with the application of the fellow servant rule, the
assumption of risk doctrine, the principle of contributory negligence, and the
many other defenses so easily raised in protracted damage suits illustrated
the need for a system whereby workers had only to prove the fact of covered
employment and the fact of injury arising from employment in order to be
compensated.
The need for a compensation scheme where liability is created solely by
statute and made compulsory and where the element of fault-either the fault
of the employer or the fault of the employee-disregarded became obvious.
Another objective was to have simplified, expeditious, inexpensive, and nonlitigious procedures so that victims of industrial accidents could more readily,
if not automatically, receive compensation for work-related injuries.
Inspite of common law defenses to defeat a claim being recognized,
employers' liability acts were a major step in the desired direction. However,
employers liability legislation proved inadequate. Legislative reform led to the
workmen's compensation.
I cite the above familiar background because workmen's compensation
represents a compromise. In return for the near certainty of receiving a sum
of money fixed by law, the injured worker gives up the right to subject the
employer to a tort suit for huge amounts of damages. Thus, liability not only
disregards the element of fault but it is also a pre- determined amount based
on the wages of the injured worker and in certain cases, the actual cost of
rehabilitation. The worker does not receive the total damages for his pain and
suffering which he could otherwise claim in a civil suit. The employer is
required to act swiftly on compensation claims. An administrative agency
supervises the program. And because the overwhelming mass of
workingmen are benefited by the compensation system, individual workers
who may want to sue for big amounts of damages must yield to the interests
of their entire working class.
The nature of the compensation principle is explained as follows:
An appreciation of the nature of the compensation principle
is essential to an understanding of the acts and the cases
interpreting them.

By the turn of the century it was apparent that the toll of

industrial accidents of both the avoidable and unavoidable
variety had become enormous, and government was faced
with the problem of who was to pay for the human wreckage
wrought by the dangers of modern industry. If the accident
was avoidable and could be attributed to the carelessness of
the employer, existing tort principles offered some measure
of redress. Even here, however, the woeful inadequacy of
the fault principle was manifest. The uncertainty of the
outcome of torts litigation in court placed the employee at a
substantial disadvantage. So long as liability depended on
fault there could be no recovery until the finger of blame had
been pointed officially at the employer or his agents. In most
cases both the facts and the law were uncertain. The
witnesses, who were usually fellow workers of the victim,
were torn between friendship or loyalty to their class, on the
one hand, and fear of reprisal by the employer, on the other.
The expense and delay of litigation often prompted the
injured employee to accept a compromise settlement for a
fraction of the full value of his claim. Even if suit were
successfully prosecuted, a large share of the proceeds of the
judgment were exacted as contingent fees by counsel. Thus
the employer against whom judgment was cast often paid a
substantial damage bill, while only a part of this enured to
the benefit of the injured employee or his dependents. The
employee's judgment was nearly always too little and too
late.

Under this approach the element of personal fault either

disappears entirely or is subordinated to broader economic
considerations. The employer absorbs the cost of accident
loss only initially; it is expected that this cost will eventually
pass down the stream of commerce in the form of increase
price until it is spread in dilution among the ultimate
consumers. So long as each competing unit in a given
industry is uniformly affected, no producer can gain any
substantial competitive advantage or suffer any appreciable
loss by reason of the general adoption of the compensation
principle.

xxx xxx xxx

Compensation, when regarded from the viewpoint of

employer and employee represents a compromise in which
each party surrenders certain advantages in order to gain
others which are of more importance both to him and to
society. The employer gives up the immunity he otherwise
would enjoy in cases where he is not at fault, and the
employee surrenders his former right to full damages and
accepts instead a more modest claim for bare essentials,
represented by compensation.

Workmen's Compensation rests upon the economic principle

that those persons who enjoy the product of a businesswhether it be in the form of goods or services- should
ultimately bear the cost of the injuries or deaths that are
incident to the manufacture, preparation and distribution of
the product. ...

In order that the compensation principle may operate

properly and with fairness to all parties it is essential that the
anticipated accident cost be predictable and that it be fixed
at a figure that will not disrupt too violently the traffic in the
product of the industry affected. Thus predictability and
moderateness of cost are necessary from the broad
economic viewpoint. ....
Compensation, then, differs from the conventional damage
suit in two important respects: Fault on the part of either
employer or employee is eliminated; and compensation
payable according to a definitely limited schedule is
substituted for damages. All compensation acts alike work
these two major changes, irrespective of how they may differ
in other particulars.

xxx xxx xxx

The importance of the compromise character of
compensation cannot be overemphasized. The statutes vary

a great deal with reference to the proper point of balance.

The amount of weekly compensation payments and the
length of the period during which compensation is to be paid
are matters concerning which the acts differ considerably.
The interpretation of any compensation statute will be
influenced greatly by the court's reaction to the basic point of
compromise established in the Act. If the court feels that the
basic compromise unduly favors the employer, it will be
tempted to restore what it regards as a proper balance by
adopting an interpretation that favors the worker. In this way,
a compensation act drawn in a spirit of extreme
conservatism may be transformed by a sympathetic court
into a fairly liberal instrument; and conversely, an act that
greatly favors the laborer may be so interpreted by the
courts that employers can have little reason to complain.
Much of the unevenness and apparent conflict in
compensation decisions throughout the various jurisdictions
must be attributed to this." (Malone & Plant, Workmen's
Compensation American Casebook Series, pp. 63-65).
The schedule of compensation, the rates of payments, the compensable
injuries and diseases, the premiums paid by employers to the present
system, the actuarial stability of the trust fund and many other interrelated
parts have all been carefully studied before the integrated scheme was
enacted in to law. We have a system whose parts must mesh harmonious
with one another if it is to succeed. The basic theory has to be followed.
If this Court disregards this totality of the scheme and in a spirit of generosity
recasts some parts of the system without touching the related others, the
entire structure is endangered. For instance, I am personally against
stretching the law and allowing payment of compensation for contingencies
never envisioned to be compensable when the law was formulated. Certainly,
only harmful results to the principle of workmen's compensation can arise if
workmen, whom the law allows to receive employment compensation, can
still elect to file damage suits for industrial accidents. It was precisely for this
reason that Section 5 of the Workmen's Compensation Act, which reads:
SEC. 5. Exclusive right to compensation.-The rights and
remedies granted by this Act to an employee by reason of a
personal injury entitling him to compensation shall exclude

all other rights and remedies accruing to the employee, his

personal representatives, dependents or nearest of kin
against the employer under the Civil Code and other laws
because of said injury. ...
Article 173 of the labor Code also provides:
ART. 173. Exclusivenesss of liability.Unless otherwise
provided, the liability of the State Insurance Fund under this
Title shall be exclusive and in place of all other liabilities of
the employer to the employee his dependents or anyone
otherwise entitled to receive damages on behalf of the
employee or his dependents.
I am against the Court assuming the role of legislator in a matter calling for
actuarial studies and public hearings. If employers already required to
contribute to the State Insurance Fund will still have to bear the cost of
damage suits or get insurance for that purpose, a major study will be
necessary. The issue before us is more far reaching than the interests of the
poor victims and their families. All workers covered by workmen's
compensation and all employers who employ covered employees are
affected. Even as I have deepest sympathies for the victims, I regret that I
am constrained to dissent from the majority opinion.

Separate Opinions

MELENCIO-HERRERA, J., dissenting:

A
This case involves a complaint for damages for the death of five employees
of PHILEX Mining Corporation under the general provisions of the Civil Code.
The Civil Code itself, however, provides for its non-applicability to the

complaint. It is specifically provided in Article 2196 of the Code, found in Title

XVIII-Damages that:
COMPENSATION FOR WORKMEN AND OTHER
EMPLOYEES IN CASE OF DEATH, INJURY OR
ILLNESS IS REGULATED BY SPECIAL LAWS.
Compensation and damages are synonymous. In Esguerra vs. Muoz
Palma, etc., et al., 104 Phil. 582, 586, Justice J.B.L. Reyes had said:
Petitioner also avers that compensation is not damages. This
argument is but a play on words. The term compensation' is
used in the law (Act 3812 and Republic Act 772) in the sense
of indemnity for damages suffered, being awarded for a
personal injury caused or aggravated by or in the course of
employment. ...
By the very provisions of the Civil Code, it is a "special law", not the Code
itself, which has to apply to the complaint involved in the instant case. That
"special law", in reference to the complaint, can be no other than the
Workmen's Compensation
Even assuming, without conceding, that an employee is entitled to an
election of remedies, as the majority rules, both options cannot be exercised
simultaneously, and the exercise of one will preclude the exercise of the
other. The petitioners had already exercised their option to come under the
Workmen's Compensation Act, and they have already received
compensation payable to them under that Act. Stated differently, the remedy
under the Workmen's Compensation Act had already become a "finished
transaction".
There are two considerations why it is believed petitioners should no longer
be allowed to exercise the option to sue under the Civil Code. In the first
place, the proceedings under the Workmen's Compensation Act have already
become the law in regards to" the "election of remedies", because those
proceedings had become a "finished transaction".
In the second place, it should be plainly equitable that, if a person entitled to
an "election of remedies" makes a first election and accepts the benefits
thereof, he should no longer be allowed to avail himself of the second option.

At the very least, if he wants to make a second election, in disregard of the

first election he has made, when he makes the second election he should
surrender the benefits he had obtained under the first election, This was not
done in the case before the Court.
B.
'There is full concurrence on my part with the dissenting opinion of Mr.
Justice Gutierrez upholding "the exclusory provision of the Workmen's
Compensation Act." I may further add:
1. The Workmen's Compensation Act (Act No. 3428) was approved on
December 10, 1927 and took effect on June 10, 1928. It was patterned from
Minnesota and Hawaii statutes.
Act No. 3428 was adopted by the Philippine legislature, in
Spanish and some sections of the law were taken from the
statutes of Minnesota and Hawaii, (Chapter 209 of the
Revised Laws of Hawaii, 1925). [Morabe & Inton, Workmen's
Compensation Act, p. 2]
Under the Workmen's Compensation Act of Hawaii, when the Act is
applicable, the remedy under the Act is exclusive The following is stated in 1
Schneider Workmen's Compensation Text, pp. 266, 267.
Sec. 112. Hawaii
Statutory Synopsis. The act is compulsory as to employees
in 'all industrial employment' and employees of the territory
and its political subdivisions. (Sections 7480-7481, S.S., Vol.
1, p. 713.)
Compensation is not payable when injury is due to
employee's willful intention to injure himself or another or to
his intoxication. (Sec. 7482, S.S., p. 713.)
When the act is applicable the remedy thereunder is
exclusive (Sec. 7483, S.S., p. 714.)

2. In providing for exclusiveness of the remedy under our Workmen's

Compensation Act, the Philippine Legislature worded the first paragraph of
Section 5 of the Act as follows:
SEC. 5. Exclusive right to compensation.-The rights and
remedies granted by this Act to an employee
by reason of a personal injury entitling him to compensation
shall exclude all other rights and remedies accruing to the
employee, his personal representatives, dependents or
nearest of kin against the employer
under the Civil Code and other laws, because of said injury
(Paragraphing and emphasis supplied)
In regards to the intent of the Legislature under the foregoing provision:
A cardinal rule in the interpretation of statutes is that the
meaning and intention of the law-making body must be
sought, first of all in the words of the statute itself, read and
considered in their natural, ordinary, commonly-accepted
and most obvious significations, according to good and
approved usage and without resorting to forced or subtle
construction Courts, therefore, as a rule, cannot presume
that the law-making body does not know the meaning of
words and the rules of grammar. Consequently, the
grammatical reading of a statute must be presumed to yield
its correct sense. (Espino vs. Cleofe 52 SCRA 92, 98) [Italics
supplied]

The use of the word "exclusively is a further confirmation of the exclusory

provision of the Act, subject only to exceptions which may be provided in the
Act itself.
4. It might be mentioned that, within the Act itself, provision is made for
remedies other than within the Act itself. Thus, Section 6, in part, provides:
SEC. 6. Liability of third parties.-In case an employee suffers
an injury for which compensation is due under this Act by
any other person besides his employer, it shall be optional
with such injured employee either to claim compensation
from his employer, under this Act, or sue such other person
for damages, in accordance with law; ... (Emphasis supplied)
If the legislative intent under the first paragraph of Section 5 were to allow the
injured employee to sue his employer under the Civil Code, the legislator
could very easily have formulated the said first paragraph of Section 5
according to the pattern of Section 6. That that was not done shows the
legislative intent not to allow any option to an employee to sue the employer
under the Civil Code for injuries compensable under the Act.
5. There should be no question but that the original first paragraph of Section
5 of the Workmen's Compensation Act, formulated in 1927, provided that an
injured worker or employee, or his heirs, if entitled to compensation under the
Act, cannot have independent recourse neither to the Civil Code nor to any
other law relative to the liability of the employer. After 1927, there were
occasions when the legislator had the opportunity to amend the first
paragraph of Section 5 such that the remedies under the Act would not be
exclusive; yet, the legislator refrained from doing so. That shows the
legislatives continuing intent to maintain the exclusory provision of the first
paragraph of Section 5 unless otherwise provided in the Act itself.

3. The original second paragraph of Section 5 provided:

(a) The original second paragraph of Section 5 provided:
Employers contracting laborers in the Philippine Islands for
work outside the same shall stipulate with such laborers that
the remedies prescribed by this Act shall apply exclusively to
injuries received outside the Islands through accidents
happening in and during the performance of the duties of the
employment. (Italics supplied)

Employers contracting laborers in the Philippine Islands for

work outside the same shall stipulate with such laborers that
the remedies prescribed by this Act shall apply (exclusively)
to injuries received outside the Islands through accidents
happening in and during the performance of the duties of the
employment (and all service contracts made in the manner

prescribed in this section be presumed to include such

agreement).
On June 20, 1952, through RA 772, the foregoing second paragraph was
amended with the elimination of the underlined words in parentheses, and
the addition of this sentence at the end of the paragraph:
Such stipulation shall not prejudice the right of the laborers
to the benefits of the Workmen's Compensation Law of the
place where the accident occurs, should such law be more
favorable to them. (Emphasis supplied)
It will be seen that, within the Act itself, the exclusory character of the Act was
amended. At that time, if he had so desired, the legislator could have
amended the first paragraph of Section 5 so that the employee would have
the option to sue the employer under the Act, or under the Civil Code, should
the latter be more favorable to him.
(b) The Workmen's Compensation Act, which took effect in 1927, grants
compensation to an injured employee without regard to the presence or
absence of negligence on the part of the employer. The compensation is
deemed an expense chargeable to the industry (Murillo vs. Mendoza, 66
Phil. 689 [1938]).
In time, it must have been thought that it was inequitable to have the amount
of compensation, caused by negligence on the part of the employer, to be the
same amount payable when the employer was not negligent. Based on that
thinking, Section 4-A 1 was included into the Act, on June 20, 1952, through
RA 772. Said Section 4-A increased the compensation payable by 50% in
case there was negligence on the part of the employer. That additional
section evidenced the intent of the legislator not to give an option to an
employee, injured with negligence on the part of the employer, to sue the
latter under the provisions of the Civil Code.
On June 20, 1964, Section 4-A was amended (insubstantially) by RA 4119.
The legislator was again given the opportunity to provide, but he did not, the
option to an employee to sue under the Act or under the Civil Code.
When a Court gives effect to a statute not in accordance with the intent of the
law-maker, the Court is unjustifiably legislating.

It is in view of the foregoing that I vote for affirmation of the trial Court's
dismissal of the Complaint.
GUTIERREZ, JR., J., dissenting:
To grant the petition and allow the victims of industrial accidents to file
damages suits based on torts would be a radical innovation not only contrary
to the express provisions of the Workmen's Compensation Act but a
departure from the principles evolved in the long history of workmen's
compensation. At the very least, it should be the legislature and not this
Court which should remove the exclusory provision of the Workmen's
Compensation Act, a provision reiterated in the present Labor Code on
employees' compensation.
Workmen's compensation evolved to remedy the evils associated with the
situation in the early years of the industrial revolution when injured
workingmen had to rely on damage suits to get recompense.
Before workmen's compensation, an injured worker seeking damages would
have to prove in a tort suit that his employer was either negligent or in bad
faith, that his injury was caused by the employer and not a fellow worker, and
that he was not guilty of contributory negligence. The employer could employ
not only his wealth in defeating the claim for damages but a host of common
law defenses available to him as well. The worker was supposed to know
what he entered into when he accepted employment. As stated in the leading
case of Priestley u. Fowler (3 M. & W. 1, 150 Reprint 1030) decided in 1837
"the mere relation of the master and the servant never can imply an
obligation on the part of the master to take more care of the servant than he
may reasonably be expected to do of himself." By entering into a contract of
employment, the worker was deemed to accept the risks of employment that
he should discover and guard against himself.
The problems associated with the application of the fellow servant rule, the
assumption of risk doctrine, the principle of contributory negligence, and the
many other defenses so easily raised in protracted damage suits illustrated
the need for a system whereby workers had only to prove the fact of covered
employment and the fact of injury arising from employment in order to be
compensated.

The need for a compensation scheme where liability is created solely by

statute and made compulsory and where the element of fault-either the fault
of the employer or the fault of the employee-disregarded became obvious.
Another objective was to have simplified, expeditious, inexpensive, and nonlitigious procedures so that victims of industrial accidents could more readily,
if not automatically, receive compensation for work-related injuries.
Inspite of common law defenses to defeat a claim being recognized,
employers' liability acts were a major step in the desired direction. However,
employers liability legislation proved inadequate. Legislative reform led to the
workmen's compensation.
I cite the above familiar background because workmen's compensation
represents a compromise. In return for the near certainty of receiving a sum
of money fixed by law, the injured worker gives up the right to subject the
employer to a tort suit for huge amounts of damages. Thus, liability not only
disregards the element of fault but it is also a pre- determined amount based
on the wages of the injured worker and in certain cases, the actual cost of
rehabilitation. The worker does not receive the total damages for his pain and
suffering which he could otherwise claim in a civil suit. The employer is
required to act swiftly on compensation claims. An administrative agency
supervises the program. And because the overwhelming mass of
workingmen are benefited by the compensation system, individual workers
who may want to sue for big amounts of damages must yield to the interests
of their entire working class.
The nature of the compensation principle is explained as follows:
An appreciation of the nature of the compensation principle
is essential to an understanding of the acts and the cases
interpreting them.
By the turn of the century it was apparent that the toll of
industrial accidents of both the avoidable and unavoidable
variety had become enormous, and government was faced
with the problem of who was to pay for the human wreckage
wrought by the dangers of modern industry. If the accident
was avoidable and could be attributed to the carelessness of
the employer, existing tort principles offered some measure
of redress. Even here, however, the woeful inadequacy of

the fault principle was manifest. The uncertainty of the

outcome of torts litigation in court placed the employee at a
substantial disadvantage. So long as liability depended on
fault there could be no recovery until the finger of blame had
been pointed officially at the employer or his agents. In most
cases both the facts and the law were uncertain. The
witnesses, who were usually fellow workers of the victim,
were torn between friendship or loyalty to their class, on the
one hand, and fear of reprisal by the employer, on the other.
The expense and delay of litigation often prompted the
injured employee to accept a compromise settlement for a
fraction of the full value of his claim. Even if suit were
successfully prosecuted, a large share of the proceeds of the
judgment were exacted as contingent fees by counsel. Thus
the employer against whom judgment was cast often paid a
substantial damage bill, while only a part of this enured to
the benefit of the injured employee or his dependents. The
employee's judgment was nearly always too little and too
late.
xxx xxx xxx
Workmen's Compensation rests upon the economic principle
that those persons who enjoy the product of a businesswhether it be in the form of goods or services- should
ultimately bear the cost of the injuries or deaths that are
incident to the manufacture, preparation and distribution of
the product. ...
xxx xxx xxx
Under this approach the element of personal fault either
disappears entirely or is subordinated to broader economic
considerations. The employer absorbs the cost of accident
loss only initially; it is expected that this cost will eventually
pass down the stream of commerce in the form of increase
price until it is spread in dilution among the ultimate
consumers. So long as each competing unit in a given
industry is uniformly affected, no producer can gain any
substantial competitive advantage or suffer any appreciable

loss by reason of the general adoption of the compensation

principle.
In order that the compensation principle may operate
properly and with fairness to all parties it is essential that the
anticipated accident cost be predictable and that it be fixed
at a figure that will not disrupt too violently the traffic in the
product of the industry affected. Thus predictability and
moderateness of cost are necessary from the broad
economic viewpoint. ....
Compensation, then, differs from the conventional damage
suit in two important respects: Fault on the part of either
employer or employee is eliminated; and compensation
payable according to a definitely limited schedule is
substituted for damages. All compensation acts alike work
these two major changes, irrespective of how they may differ
in other particulars.
Compensation, when regarded from the viewpoint of
employer and employee represents a compromise in which
each party surrenders certain advantages in order to gain
others which are of more importance both to him and to
society. The employer gives up the immunity he otherwise
would enjoy in cases where he is not at fault, and the
employee surrenders his former right to full damages and
accepts instead a more modest claim for bare essentials,
represented by compensation.
The importance of the compromise character of
compensation cannot be overemphasized. The statutes vary
a great deal with reference to the proper point of balance.
The amount of weekly compensation payments and the
length of the period during which compensation is to be paid
are matters concerning which the acts differ considerably.
The interpretation of any compensation statute will be
influenced greatly by the court's reaction to the basic point of
compromise established in the Act. If the court feels that the
basic compromise unduly favors the employer, it will be
tempted to restore what it regards as a proper balance by

adopting an interpretation that favors the worker. In this way,

a compensation act drawn in a spirit of extreme
conservatism may be transformed by a sympathetic court
into a fairly liberal instrument; and conversely, an act that
greatly favors the laborer may be so interpreted by the
courts that employers can have little reason to complain.
Much of the unevenness and apparent conflict in
compensation decisions throughout the various jurisdictions
must be attributed to this." (Malone & Plant, Workmen's
Compensation American Casebook Series, pp. 63-65).
The schedule of compensation, the rates of payments, the compensable
injuries and diseases, the premiums paid by employers to the present
system, the actuarial stability of the trust fund and many other interrelated
parts have all been carefully studied before the integrated scheme was
enacted in to law. We have a system whose parts must mesh harmonious
with one another if it is to succeed. The basic theory has to be followed.
If this Court disregards this totality of the scheme and in a spirit of generosity
recasts some parts of the system without touching the related others, the
entire structure is endangered. For instance, I am personally against
stretching the law and allowing payment of compensation for contingencies
never envisioned to be compensable when the law was formulated. Certainly,
only harmful results to the principle of workmen's compensation can arise if
workmen, whom the law allows to receive employment compensation, can
still elect to file damage suits for industrial accidents. It was precisely for this
reason that Section 5 of the Workmen's Compensation Act, which reads:
SEC. 5. Exclusive right to compensation.-The rights and
remedies granted by this Act to an employee by reason of a
personal injury entitling him to compensation shall exclude
all other rights and remedies accruing to the employee, his
personal representatives, dependents or nearest of kin
against the employer under the Civil Code and other laws
because of said injury. ...
Article 173 of the labor Code also provides:
ART. 173. Exclusivenesss of liability.Unless otherwise
provided, the liability of the State Insurance Fund under this

Title shall be exclusive and in place of all other liabilities of

the employer to the employee his dependents or anyone
otherwise entitled to receive damages on behalf of the
employee or his dependents.
I am against the Court assuming the role of legislator in a matter calling for
actuarial studies and public hearings. If employers already required to
contribute to the State Insurance Fund will still have to bear the cost of
damage suits or get insurance for that purpose, a major study will be
necessary. The issue before us is more far reaching than the interests of the
poor victims and their families. All workers covered by workmen's
compensation and all employers who employ covered employees are
affected. Even as I have deepest sympathies for the victims, I regret that I
am constrained to dissent from the majority opinion.

Footnotes
1 SEC. 4-A. Right to additional compensation.- In case of the
employee's death, injury or sickness due to the failure of the
to comply with any law, or with any order, rule or regulation
of the Workmen's Compensation Commission or the Bureau
of Labor Standards or should the employer violate the
provisions of Republic Act Numbered Six hundred seventynine and its amendments or fail to install and maintain safety
appliances, or take other precautions for the prevention of
accidents or occupational disease, he shall be liable to pay
an additional compensation equal to fifty per centum of the
compensation fixed in this Act.
DANILO E. PARAS, petitioner, vs. COMMISSION ON
ELECTIONS, respondent.
RESOLUTION
FRANCISCO, J.:
Petitioner Danilo E. Paras is the incumbent Punong Barangay
of Pula, Cabanatuan City who won during the last regular barangay election

in 1994. A petition for his recall as Punong Barangay was filed by the
registered voters of the barangay. Acting on the petition for recall, public
respondent Commission on Elections (COMELEC) resolved to approve the
petition, scheduled the petition signing on October 14, 1995, and set the
recall election on November 13, 1995.[1] At least 29.30% of the registered
voters signed the petition, well above the 25% requirement provided by law.
The COMELEC, however, deferred the recall election in view of petitioners
opposition. On December 6, 1995, the COMELEC set anew the recall
election, this time on December 16, 1995. To prevent the holding of the recall
election, petitioner filed before the Regional Trial Court of Cabanatuan City a
petition for injunction, docketed as SP Civil Action No. 2254-AF, with the trial
court issuing a temporary restraining order. After conducting a summary
hearing, the trial court lifted the restraining order, dismissed the petition and
required petitioner and his counsel to explain why they should not be cited for
contempt for misrepresenting that the barangay recall election was without
COMELEC approval.[2]
In a resolution dated January 5, 1996, the COMELEC, for the third time, rescheduled the recall election on January 13, 1996; hence, the instant petition
for certiorari with urgent prayer for injunction. On January 12, 1996, the Court
issued a temporary restraining order and required the Office of the Solicitor
General, in behalf of public respondent, to comment on the petition. In view
of the Office of the Solicitor Generals manifestation maintaining an opinion
adverse to that of the COMELEC, the latter through its law department filed
the required comment. Petitioner thereafter filed a reply.[3]
Petitioners argument is simple and to the point. Citing Section 74 (b) of
Republic Act No. 7160, otherwise known as the Local Government Code,
which states that no recall shall take place within one (1) year from the date
of the officials assumption to office or one (1) year immediately preceding a
regular local election, petitioner insists that the scheduled January 13, 1996
recall election is now barred as the Sangguniang Kabataan (SK) election was
set by Republic Act No. 7808 on the first Monday of May 1996, and every
three years thereafter. In support thereof, petitioner cites Associated Labor
Union v. Letrondo-Montejo, 237 SCRA 621, where the Court considered the
SK election as a regular local election. Petitioner maintains that as the SK
election is a regular local election, hence no recall election can be had for
barely four months separate the SK election from the recall election. We do
not agree.

The subject provision of the Local Government Code provides:

SEC. 74. Limitations on Recall. (a) Any elective local official may be the
subject of a recall election only once during his term of office for loss of
confidence.

should not be in conflict with the Constitutional mandate of Section 3 of

Article X of the Constitution to enact a local government code which shall
provide for a more responsive and accountable local government structure
instituted through a system of decentralization with effective mechanisms of
recall, initiative, and referendum x x x.

(b) No recall shall take place within one (1) year from the date of the
officials assumption to office or one (1) year immediately preceding
a regular local election.

Moreover, petitioners too literal interpretation of the law leads to absurdity

which we cannot countenance. Thus, in a case, the Court made the following
admonition:

[Emphasis added.]

We admonish against a too-literal reading of the law as this is apt to constrict

rather than fulfill its purpose and defeat the intention of its authors. That
intention is usually found not in the letter that killeth but in the spirit that
vivifieth x x x[8]

It is a rule in statutory construction that every part of the statute must be

interpreted with reference to the context, i.e., that every part of the statute
must be considered together with the other parts, and kept subservient to the
general intent of the whole enactment.[4] The evident intent of Section 74 is to
subject an elective local official to recall election once during his term of
office. Paragraph (b) construed together with paragraph (a) merely
designates the period when such elective local official may be subject of a
recall election, that is, during the second year of his term of office. Thus,
subscribing to petitioners interpretation of the phrase regular local election to
include the SK election will unduly circumscribe the novel provision of the
Local Government Code on recall, a mode of removal of public officers by
initiation of the people before the end of his term. And if the SK election
which is set by R.A. No. 7808 to be held every three years from May 1996
were to be deemed within the purview of the phrase regular local election, as
erroneously insisted by petitioner, then no recall election can be conducted
rendering inutile the recall provision of the Local Government Code.
In the interpretation of a statute, the Court should start with the assumption
that the legislature intended to enact an effective law, and the legislature is
not presumed to have done a vain thing in the enactment of a statute. [5] An
interpretation should, if possible, be avoided under which a statute or
provision being construed is defeated, or as otherwise expressed, nullified,
destroyed, emasculated, repealed, explained away, or rendered insignificant,
meaningless, inoperative or nugatory.[6]
It is likewise a basic precept in statutory construction that a statute should be
interpreted in harmony with the Constitution.[7] Thus, the interpretation of
Section 74 of the Local Government Code, specifically paragraph (b) thereof,

The spirit, rather than the letter of a law determines its construction; hence, a
statute, as in this case, must be read according to its spirit and intent.
Finally, recall election is potentially disruptive of the normal working of the
local government unit necessitating additional expenses, hence the
prohibition against the conduct of recall election one year immediately
preceding the regular local election. The proscription is due to the proximity
of the next regular election for the office of the local elective official
concerned. The electorate could choose the officials replacement in the said
election who certainly has a longer tenure in office than a successor elected
through a recall election. It would, therefore, be more in keeping with the
intent of the recall provision of the Code to construe regular local election as
one referring to an election where the office held by the local elective official
sought to be recalled will be contested and be filled by the electorate.
Nevertheless, recall at this time is no longer possible because of the
limitation stated under Section 74 (b) of the Code considering that the next
regular election involving the barangay office concerned is barely seven (7)
months away, the same having been scheduled on May 1997. [9]
ACCORDINGLY, the petition is hereby dismissed for having become moot
and academic. The temporary restraining order issued by the Court
on January 12, 1996, enjoining the recall election should be as it is hereby
made permanent.

SO ORDERED.
Romero, Melo, Puno, Kapunan, Hermosisima, Jr., Panganiban, and Torres,
Jr., JJ., concur.
Narvasa, C.J., Padilla, Regalado, Bellosillo, Vitug, and Mendoza, JJ., concur
in the majority and separate concurring opinions.
Davide, Jr., Please see separate concurring opinion.
G.R. No. 72873 May 28, 1987
CARLOS ALONZO and CASIMIRA ALONZO, petitioners,
vs.
INTERMEDIATE APPELLATE COURT and TECLA PADUA, respondents.
Perpetuo L.B. Alonzo for petitioners.

On March 15, 1963, one of them, Celestino Padua, transferred his undivided
share of the herein petitioners for the sum of P550.00 by way of absolute
sale. 2 One year later, on April 22, 1964, Eustaquia Padua, his sister, sold her
own share to the same vendees, in an instrument denominated "Con Pacto
de Retro Sale," for the sum of P 440.00. 3
By virtue of such agreements, the petitioners occupied, after the said sales,
an area corresponding to two-fifths of the said lot, representing the portions
sold to them. The vendees subsequently enclosed the same with a fence. In
1975, with their consent, their son Eduardo Alonzo and his wife built a semiconcrete house on a part of the enclosed area. 4
On February 25, 1976, Mariano Padua, one of the five coheirs, sought to
redeem the area sold to the spouses Alonzo, but his complaint was
dismissed when it appeared that he was an American citizen . 5 On May 27,
1977, however, Tecla Padua, another co-heir, filed her own complaint
invoking the same right of redemption claimed by her brother. 6

CRUZ, J.:

The trial court * also dismiss this complaint, now on the ground that the right
had lapsed, not having been exercised within thirty days from notice of the
sales in 1963 and 1964. Although there was no written notice, it was held
that actual knowledge of the sales by the co-heirs satisfied the requirement
of the law. 7

The question is sometimes asked, in serious inquiry or in curious conjecture,

whether we are a court of law or a court of justice. Do we apply the law even
if it is unjust or do we administer justice even against the law? Thus queried,
we do not equivocate. The answer is that we do neither because we are a
court both of law and of justice. We apply the law with justice for that is our
mission and purpose in the scheme of our Republic. This case is an
illustration.

In truth, such actual notice as acquired by the co-heirs cannot be plausibly

denied. The other co-heirs, including Tecla Padua, lived on the same lot,
which consisted of only 604 square meters, including the portions sold to the
petitioners . 8 Eustaquia herself, who had sold her portion, was staying in the
same house with her sister Tecla, who later claimed redemption
petition. 9 Moreover, the petitioners and the private respondents were close
friends and neighbors whose children went to school together. 10

Five brothers and sisters inherited in equal pro indiviso shares a parcel of
land registered in 'the name of their deceased parents under OCT No. 10977
of the Registry of Deeds of Tarlac. 1

It is highly improbable that the other co-heirs were unaware of the sales and
that they thought, as they alleged, that the area occupied by the petitioners
had merely been mortgaged by Celestino and Eustaquia. In the
circumstances just narrated, it was impossible for Tecla not to know that the
area occupied by the petitioners had been purchased by them from the other.
co-heirs. Especially significant was the erection thereon of the permanent
semi-concrete structure by the petitioners' son, which was done without
objection on her part or of any of the other co-heirs.

Luis R. Reyes for private respondent.

The only real question in this case, therefore, is the correct interpretation and
application of the pertinent law as invoked, interestingly enough, by both the
petitioners and the private respondents. This is Article 1088 of the Civil Code,
providing as follows:
Art. 1088. Should any of the heirs sell his hereditary rights to a stranger
before the partition, any or all of the co-heirs may be subrogated to the rights
of the purchaser by reimbursing him for the price of the sale, provided they
do so within the period of one month from the time they were notified in
writing of the sale by the vendor.
In reversing the trial court, the respondent court ** declared that the notice
required by the said article was written notice and that actual notice would
not suffice as a substitute. Citing the same case of De Conejero v. Court of
Appeals 11 applied by the trial court, the respondent court held that that
decision, interpreting a like rule in Article 1623, stressed the need for written
notice although no particular form was required.
Thus, according to Justice J.B.L. Reyes, who was the ponente of the Court,
furnishing the co-heirs with a copy of the deed of sale of the property subject
to redemption would satisfy the requirement for written notice. "So long,
therefore, as the latter (i.e., the redemptioner) is informed in writing of the
sale and the particulars thereof," he declared, "the thirty days for redemption
start running. "
In the earlier decision of Butte v. UY, 12 " the Court, speaking through the
same learned jurist, emphasized that the written notice should be given by
the vendor and not the vendees, conformably to a similar requirement under
Article 1623, reading as follows:
Art. 1623. The right of legal pre-emption or redemption shall not be exercised
except within thirty days from the notice in writing by the prospective vendor,
or by the vendors, as the case may be. The deed of sale shall not be
recorded in the Registry of Property, unless accompanied by an affidavit of
the vendor that he has given written notice thereof to all possible
redemptioners.
The right of redemption of co-owners excludes that of the adjoining owners.

As "it is thus apparent that the Philippine legislature in Article 1623

deliberately selected a particular method of giving notice, and that notice
must be deemed exclusive," the Court held that notice given by
the vendees and not the vendor would not toll the running of the 30-day
period.
The petition before us appears to be an illustration of the Holmes dictum that
"hard cases make bad laws" as the petitioners obviously cannot argue
against the fact that there was really no written notice given by the vendors to
their co-heirs. Strictly applied and interpreted, Article 1088 can lead to only
one conclusion, to wit, that in view of such deficiency, the 30 day period for
redemption had not begun to run, much less expired in 1977.
But as has also been aptly observed, we test a law by its results; and
likewise, we may add, by its purposes. It is a cardinal rule that, in seeking the
meaning of the law, the first concern of the judge should be to discover in its
provisions the in tent of the lawmaker. Unquestionably, the law should never
be interpreted in such a way as to cause injustice as this is never within the
legislative intent. An indispensable part of that intent, in fact, for we presume
the good motives of the legislature, is to render justice.
Thus, we interpret and apply the law not independently of but in consonance
with justice. Law and justice are inseparable, and we must keep them so. To
be sure, there are some laws that, while generally valid, may seem arbitrary
when applied in a particular case because of its peculiar circumstances. In
such a situation, we are not bound, because only of our nature and functions,
to apply them just the same, in slavish obedience to their language. What we
do instead is find a balance between the word and the will, that justice may
be done even as the law is obeyed.
As judges, we are not automatons. We do not and must not unfeelingly apply
the law as it is worded, yielding like robots to the literal command without
regard to its cause and consequence. "Courts are apt to err by sticking too
closely to the words of a law," so we are warned, by Justice Holmes again,
"where these words import a policy that goes beyond them." 13 While we
admittedly may not legislate, we nevertheless have the power to interpret the
law in such a way as to reflect the will of the legislature. While we may not
read into the law a purpose that is not there, we nevertheless have the right
to read out of it the reason for its enactment. In doing so, we defer not to "the

letter that killeth" but to "the spirit that vivifieth," to give effect to the law
maker's will.
The spirit, rather than the letter of a statute determines its construction,
hence, a statute must be read according to its spirit or intent. For what is
within the spirit is within the letter but although it is not within the letter
thereof, and that which is within the letter but not within the spirit is not within
the statute. Stated differently, a thing which is within the intent of the
lawmaker is as much within the statute as if within the letter; and a thing
which is within the letter of the statute is not within the statute unless within
the intent of the lawmakers. 14
In requiring written notice, Article 1088 seeks to ensure that the redemptioner
is properly notified of the sale and to indicate the date of such notice as the
starting time of the 30-day period of redemption. Considering the shortness
of the period, it is really necessary, as a general rule, to pinpoint the precise
date it is supposed to begin, to obviate any problem of alleged delays,
sometimes consisting of only a day or two.
The instant case presents no such problem because the right of redemption
was invoked not days but years after the sales were made in 1963 and 1964.
The complaint was filed by Tecla Padua in 1977, thirteen years after the first
sale and fourteen years after the second sale. The delay invoked by the
petitioners extends to more than a decade, assuming of course that there
was a valid notice that tolled the running of the period of redemption.
Was there a valid notice? Granting that the law requires the notice to be
written, would such notice be necessary in this case? Assuming there was a
valid notice although it was not in writing. would there be any question that
the 30-day period for redemption had expired long before the complaint was
filed in 1977?

In the face of the established facts, we cannot accept the private

respondents' pretense that they were unaware of the sales made by their
brother and sister in 1963 and 1964. By requiring written proof of such notice,
we would be closing our eyes to the obvious truth in favor of their palpably
false claim of ignorance, thus exalting the letter of the law over its purpose.
The purpose is clear enough: to make sure that the redemptioners are duly
notified. We are satisfied that in this case the other brothers and sisters were
actually informed, although not in writing, of the sales made in 1963 and
1964, and that such notice was sufficient.
Now, when did the 30-day period of redemption begin?
While we do not here declare that this period started from the dates of such
sales in 1963 and 1964, we do say that sometime between those years and
1976, when the first complaint for redemption was filed, the other co-heirs
were actually informed of the sale and that thereafter the 30-day period
started running and ultimately expired. This could have happened any time
during the interval of thirteen years, when none of the co-heirs made a move
to redeem the properties sold. By 1977, in other words, when Tecla Padua
filed her complaint, the right of redemption had already been extinguished
because the period for its exercise had already expired.
The following doctrine is also worth noting:
While the general rule is, that to charge a party with laches in the assertion of
an alleged right it is essential that he should have knowledge of the facts
upon which he bases his claim, yet if the circumstances were such as should
have induced inquiry, and the means of ascertaining the truth were readily
available upon inquiry, but the party neglects to make it, he will be
chargeable with laches, the same as if he had known the facts. 15
It was the perfectly natural thing for the co-heirs to wonder why the spouses
Alonzo, who were not among them, should enclose a portion of the inherited
lot and build thereon a house of strong materials. This definitely was not the
act of a temporary possessor or a mere mortgagee. This certainly looked like
an act of ownership. Yet, given this unseemly situation, none of the co-heirs
saw fit to object or at least inquire, to ascertain the facts, which were readily
available. It took all of thirteen years before one of them chose to claim the
right of redemption, but then it was already too late.

We realize that in arriving at our conclusion today, we are deviating from the
strict letter of the law, which the respondent court understandably applied
pursuant to existing jurisprudence. The said court acted properly as it had no
competence to reverse the doctrines laid down by this Court in the abovecited cases. In fact, and this should be clearly stressed, we ourselves are not
abandoning the De Conejero and Buttle doctrines. What we are doing simply
is adopting an exception to the general rule, in view of the peculiar
circumstances of this case.

ELENA SALENILLAS AND BERNARDINO SALENILLAS, petitioners,

vs.
HONORABLE COURT OF APPEALS and HONORABLE RAYMUNDO
SEVA, JUDGE OF BRANCH 38 OF THE REGIONAL TRIAL COURT OF
CAMARINES NORTE and WILLIAM GUERRA, respondents.
Jose L. Lapak for petitioners.
Jose T. Atienza for private respondent.

The co-heirs in this case were undeniably informed of the sales although no
notice in writing was given them. And there is no doubt either that the 30-day
period began and ended during the 14 years between the sales in question
and the filing of the complaint for redemption in 1977, without the co-heirs
exercising their right of redemption. These are the justifications for this
exception.
More than twenty centuries ago, Justinian defined justice "as the constant
and perpetual wish to render every one his due." 16 That wish continues to
motivate this Court when it assesses the facts and the law in every case
brought to it for decision. Justice is always an essential ingredient of its
decisions. Thus when the facts warrants, we interpret the law in a way that
will render justice, presuming that it was the intention of the lawmaker, to
begin with, that the law be dispensed with justice. So we have done in this
case.
WHEREFORE, the petition is granted. The decision of the respondent court
is REVERSED and that of the trial court is reinstated, without any
pronouncement as to costs. It is so ordered.
Teehankee, C.J., Yap, Narvasa, Melencio-Herrera Gutierrez, Jr., Paras,
Gancayco, Padilla, Bidin, Sarmiento and Cortes, JJ., concur.
Fernan and Feliciano, JJ., are on leave.
G.R. No. 78687 January 31, 1989

SARMIENTO, J.:
This petition for review on certiorari which seeks the reversal and setting
aside of the decision 1 of the Court of Appeals 2 dismissing the petition
for certiorari against Judge Raymundo Seva of the Regional Trial Court of
Camarines Norte and the private respondent, William Guerra, involves a pure
question of law i.e., the coverage and application of Section 119 of
Commonwealth Act No. 141, as amended, known otherwise as the Public
Land Act.
The facts are undisputed.
The property subject matter of the case was formerly covered by Original
Certificate of Title No. P-1248, issued by virtue of Free Patent Application No.
192765, in favor of the spouses, Florencia H. de Enciso and Miguel Enciso.
The said original certificate of title was inscribed in the Registration Book for
the Province of Camarines Norte on December 10, 1961. On February 28,
1970, the patentees, the Enciso spouses, by an Absolute Deed of Sale, sold
the property in favor of the petitioners, the spouses Elena Salenillas and
Bernardino Salenillas for a consideration of P900.00. Petitioner Elena
Salenillas is a daughter of the Encisos. As a result of the aforementioned
sale, Transfer Certificate of Title No. T-8104 of the Register of Deeds of
Camarines Norte was issued in the name of the Salenillas, cancelling
Original Certificate of Title No. P-1248. On June 30, 1971, the petitioners
mortgaged the property now covered by T.C.T. No. T-8104 with the Rural
Bank of Daet, Inc. The mortgage was subsequently released on November
22, 1973 after the petitioners paid the amount of P1,000.00. Later, or on
December 4, 1975, the petitioners again mortgaged the property, this time in

favor of the Philippine National Bank Branch, Daet, Camarines Norte as

security for a loan of P2,500.00.
For failure of the petitioners to pay their loan, extrajudicial foreclosure
proceeding, pursuant to Act No. 3135, was instituted by the Philippine
National Bank against the mortgage and the property was sold at a public
auction held on February 27, 1981. The private respondent, William Guerra,
emerged as the highest bidder in the said public auction and as a result
thereof a "Certificate of Sale" was issued to him by the Ex Officio Provincial
Sheriff of Camarines Norte. Ultimately, on July 12, 1983, a "Sheriff's Final
Deed" was executed in favor of the private respondent.
On August 17,1983, the Philippine National Bank filed with the Regional Trial
Court of Camarines Norte at Daet, a motion for a writ of possession. The
public respondent, Judge Raymundo Seva of the trial court, acting on the
motion, issued on September 22, 1983 an order for the issuance of a writ of
possession in favor of the private respondent. When the deputy sheriff of
Camarines Norte however, attempted on November 17, 1983, to place the
property in the possession of the private respondent, the petitioners refused
to vacate and surrender the possession of the same and instead offered to
repurchase it under Section 119 of the Public Land Act. On August 15, 1984,
another motion, this time for the issuance of an alias writ of possession was
filed by the private respondent with the trial court. The petitioners, on August
31, 1984, opposed the private respondents' motion and instead made a
formal offer to repurchase the property. Notwithstanding the petitioners'
opposition and formal offer, the trial court judge on October 12, 1984 issued
the alias writ of possession prayed for the private respondent. The petitioners
moved for a reconsideration of the order but their motion was denied.
Undeterred by their initial setback, the petitioners elevated the case to the
respondent Court of Appeals by way of a petition for certiorari claiming that
the respondent trial court judge acted with grave abuse of discretion in
issuing the order dated October 12, 1984 granting the writ of possession, and
the order dated October 22, 1984, denying their motion for reconsider
consideration.
In a resolution dated January 23, 1985, the respondent appellate court gave
due course to the petition; required the parties to submit simultaneous
memoranda in support to their respective positions; and restrained the trial
court and the private respondent from executing, implementing or otherwise

giving effect to the assailed writ of possession until further orders from the
court. 3 However, in a decision promulgated on September 17, 1986, the
respondent Court of Appeals dismissed the case for lack of merit. According
to the appellate court:
It must be noted that when the original owner, Florencia H. Enciso whose
title, OCT No. P-1248, was issued on August 9, 1961, executed a deed of
absolute sale on February 28, 1970 of the property covered by said title to
spouses Elena Salenillas and Bernardino Salenillas, the five year period to
repurchase the property provided for in Section 119 of Commonwealth Act
No. 141 as amended could have already started. Prom this fact alone, the
petition should have been dismissed. However, granting that the transfer
from parent to child for a nominal sum may not be the "conveyance"
contemplated by the law. We will rule on the issue raised by the petitioners.

xxx xxx xxx

Applying the case of Monge, et al. vs. Angeles, et al., 5 the appellate court
went on to hold that the five-year period of the petitioners to repurchase
under Section 119 of the Public Land Act had already prescribed. The point
of reckoning, ruled the respondent court in consonance with Monge is from
the date the petitioners mortgaged the property on December 4, 1973. Thus,
when the petitioners made their formal offer to repurchase on August 31,
1984, the period had clearly expired.
In an effort to still overturn the decision, the petitioners moved for
reconsideration. Their motion apparently went for naught because on May 7,
1987, the respondent appellate court resolved to deny the same. Hence, this
petition.
Before us, the petitioners maintain that contrary to the rulings of the courts
below, their right to repurchase within five years under Section 119 of the
Public Land Act has not yet prescribed. To support their contention, the
petitioners cite the cases of Paras vs. Court of Appeals 6 and Manuel vs.
Philippine National Bank, et al. 7
On the other side, the private respondent, in support of the appellate court's
decision, states that the sale of the contested property by the patentees to
the petitioners disqualified the latter from being legal heirs vis-a-vis the said

property. As such, they (the petitioners) no longer enjoy the right granted to
heirs under the provisions of Section 119 of the Public Land Act. 8
In fine, what need be determined and resolved here are: whether or not the
petitioners have the right to repurchase the contested property under Section
119 of the Public Land Act; and assuming the answer to the question is in the
affirmative, whether or not their right to repurchase had already prescribed.
We rule for the petitioners. They are granted by the law the right to
repurchase their property and their right to do so subsists.
Section 119 of the Public Land Act, as amended, provides in full:
Sec. 119. Every conveyance of land acquired under the free patent or
homestead provisions, when proper, shall be subject to repurchase by the
applicant, his widow, or legal heirs within a period of five years from the date
of the conveyance.
From the foregoing legal provision, it is explicit that only three classes of
persons are bestowed the right to repurchase the applicant-patentee, his
widow, or other legal heirs. Consequently, the contention of the private
respondent sustained by the respondent appellate court that the petitioners
do not belong to any of those classes of repurchasers because they acquired
the property not through inheritance but by sale, has no legal basis. The
petitioners-spouses are the daughter and son-in-law of the Encisos,
patentees of the contested property. At the very least, petitioner Elena
Salenillas, being a child of the Encisos, is a "legal heir" of the latter. As such,
and even on this score alone, she may therefore validly repurchase. This
must be so because Section 119 of the Public Land Act, in speaking of "legal
heirs," makes no distinction. Ubi lex non distinguit nec nos distinguere
debemos.
Moreover, to indorse the distinction made by the private respondent and the
appellate court would be to contravene the very purpose of Section 119 of
the Public Land Act which is to give the homesteader or patentee every
chance to preserve for himself and his family the land that the State had
gratuitously given him as a reward for his labor in clearing and cultivating
it. 9 Considering that petitioner Salenillas is a daughter of the spouses
Florencia H. Enciso and Miguel Enciso, there is no gainsaying that allowing
her (Elena) and her husband to repurchase the property would be more in

keeping with the spirit of the law. We have time and again said that between
two statutory interpretations, that which better serves the purpose of the law
should prevail.
Guided by the same purpose of the law, and proceeding to the other issue
here raised, we rule that the five-year period for the petitioners to repurchase
their property had not yet prescribed.
The case of Monge et al. vs. Angeles, et al., 10 cited as authority by the
respondent Court of Appeals is inapplicable to the present controversy. The
facts obtaining there are substantially different from those in this case.
In Monge the conveyance involved was a pacto de retro sale and not a
foreclosure sale. More importantly, the question raised there was whether the
five-year period provided for in Section 119 "should be counted from the date
of the sale even if the same is with an option to repurchase or from the date
the ownership of the land has become consolidated in favor of the purchaser
because of the homesteader's failure to redeem it. 11 It is therefore
understandable why the Court ruled there as it did. A sale on pacto de
retro immediately vests title, ownership, and, generally possession over the
property on the vendee a retro, subject only to the right of the vendor a
retro to repurchase within the stipulated period. It is an absolute sale with a
resolutory condition.
The cases 12 pointed to by the petitioner in support of their position, on the
other hand, present facts that are quite identical to those in the case at bar.
Both cases involved properties the titles over which were obtained either
through homestead or free patent. These properties were mortgaged to a
bank as collateral for loans, and, upon failure of the owners to pay their
indebtedness, the mortgages were foreclosed. In both instances, the Court
ruled that the five-year period to. repurchase a homestead sold at public
auction or foreclosure sale under Act 3135 begins on the day after the
expiration of the period of redemption when the deed of absolute sale is
executed thereby formally transferring the property to the purchaser, and not
otherwise. Taking into account that the mortgage was foreclosed and the
mortgaged property sold at a public auction to the private respondent on
February 27, 1981, with the "Sheriff's Final Deed" issued on July 12, 1983,
the two offers of the petitioners to repurchase the first on November 17,
1983, and the second, formally, on August 31, 1984 were both made within
the prescribed five-year period.

Now, as regards the redemption price, applying Sec. 30 of Rule 39 of the

Revised Rules of Court, the petitioners should reimburse the private
respondent the amount of the purchase price at the public auction plus
interest at the rate of one per centum per month up to November 17, 1983,
together with the amounts of assessments and taxes on the property that the
private respondent might have paid after purchase and interest on the last
named amount at the same rate as that on the purchase price. 13

private respondent to reconvey the subject property and to execute the

corresponding deed of reconveyance therefor in favor of the petitioners upon
the return to him by the latter of the purchase price and the amounts, if any,
of assessments or taxes he paid plus interest of one (1%) per centum per
month on both amounts up to November 17, 1983.

WHEREFORE, the petition is GRANTED. The Decision dated September 17,

1986, and the Resolution dated May 7, 1987 of the Court of Appeals, and the
Orders dated September 22, 1983, October 12, 1984, and October 22, 1984
of the Regional Trial Court of Daet, Camarines Norte, are hereby
REVERSED and SET ASIDE, and another one ENTERED directing the

SO ORDERED.

No costs.

Melencio-Herrera (Chairperson), Paras, Padilla and Regalado, JJ., concur.