G.R. No. 168546 Case Digest

G.R. No. 168546, July 23, 2008

Michael Padua, petitioner

vs. People of the Philippines, respondent

Ponente: Quisumbing

Facts:

June 16, 2003, Padua and Edgar Ubalde were charged before the RTC Pasig of violation of R.A. No. 9165 [Comprehensive Dangerous Drugs act of 2002] for selling dangerous drugs. When arraigned, Padua assisted by counsel de officio entered a plea of not guilty. During the pre-trial, Padua’s counsel de officio manifested that his client was willing to withdraw his plea of not guilty and enter a plea of guilty to avail the benefits granted to 1^st time offenders. The prosecutor interposed no objection, thus the not guilty plea was withdrawn, Padua re-arraigned and pleaded guilty.

Padua then filed a petition for probation alleging that he is a minor and a 1^st time offender, and that he possess all qualifications and none of the disqualifications of the probation law. RTC ordered for the post-sentenced investigation and recommendation and comment of the probation office and the city prosecutor relatively.

Pasana, the chief probation and parole officer recommended Padua to be placed on probation. However, Judge Reyes-Carpio issued an order denying the petition for probation on the ground that under R.A. No. 9165, any person convicted of drug trafficking cannot avail of the privilege granted by the Probation Law.

Padua filed a motion for reconsideration but the same was denied. He filed for a petition for certiorari, but the CA dismissed his petition.

Issue: Whether Padua can avail the benefits of the Probation Law.

Held:

(1)    CA did not err in dismissing Padua’s petition for certiorari. The requisites for the certiorari must occur:  (1) the writ is directed against a tribunal, a board or any officer exercising judicial or quasi-judicial functions; (2) such tribunal, board or officer has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any plain, speedy and adequate remedy in the ordinary course of law.

“Without jurisdiction” means that the court acted with absolute lack of authority.  There is “excess of jurisdiction” when the court transcends its power or acts without any statutory authority.  “Grave abuse of discretion” implies such capricious and whimsical exercise of judgment as to be equivalent to lack or excess of jurisdiction.

(2)    Any person convicted for drug trafficking or pushing, regardless of the penalty imposed, can not avail of the privilege granted by the Probation Law or P.D. No. 968.  The elementary rule in statutory construction is that when the words and phrases of the statute are clear and unequivocal, their meaning must be determined from the language employed and the statute must be taken to mean exactly what it says.  If a statute is clear, plain and free from ambiguity, it must be given its literal meaning and applied without attempted interpretation.  This is what is known as the plain-meaning rule or verba legis.  It is expressed in the maxim,index animi sermo, or speech is the index of intention.  Furthermore, there is the maxim verba legis non est recedendum, or from the words of a statute there should be no departure.

(3)    Padua cannot argue that his right under Rep. Act No. 9344, the “Juvenile Justice and Welfare Act of 2006” was violated.  Nor can he argue that Section 32 of A.M. No. 02-1-18-SC otherwise known as the “Rule on Juveniles in Conflict with the Law” has application in this case.  Section 68 of Rep. Act No. 9344 and Section 32 of A.M. No. 02-1-18-SC both pertain to suspension of sentence and not probation.

Petitioner has already reached 21 years of age or over and thus, could no longer be considered a child for purposes of applying Rep. Act 9344. Thus, the application of Sections 38 and 40 appears moot and academic as far as his case is concerned.

G.R. No. 181306 Case Digest

G.R. No. 181306, March 21, 2011

Paterno de los Santos, Jr.

Vs Court of Appeals, et al.

Facts:

On November 20, 1996, RTC Cebu rendered a decision finding petitioner Paterno guilty of crime intentional abortion. Petitioner appealed his conviction to the CA. CA affirmed the conviction with modification as to the penalty.

Petitioner then filed an application for probation. CA denied the application. Petitioner filed a motion for reconsideration but was likewise denied. CA contends that the petitioner is ineligible to apply for probation, considering the fact that he has waived his right to avail the benefits of probation law when he appealed the judgment of conviction by the RTC.

Petitioner argues that his case is an exception provided by law – an accused who has appealed his conviction from the benefits of probation, he only became eligible only after the CA modified the judgment and reduced the maximum term of the penalty imposed to 3 years, 6months and 21 days.

In its comment, the Office of the Solicitor asserts that when the petitioner filed an appeal from the trial court’s decision, he was, in effect, precluded from the benefits of probation. Petitioner is disqualified for probation because the RTC sentenced him to suffer an imprisonment of more than 6 years which is not probationable.

Held:

Petition is without merit.

Probation is a special privilege granted by the State to a penitent qualified offender.

The pertinent provision of the Probation Law, as amended, reads:

Sec. 4. Grant of Probation. — Subject to the provisions of this Decree, the trial court may, after it shall have convicted and sentenced a defendant and upon application by said defendant within the period for perfecting an appeal, suspend the execution of the sentence and place the defendant on probation for such period and upon such terms and conditions as it may deem best; Provided, That no application for probation shall be entertained or granted if the defendant has perfected the appeal from the judgment of conviction.

It is undisputed that petitioner appealed from the decision of the trial court. This fact alone merits the denial of petitioner's Application for Probation. Having appealed from the judgment of the trial court and having applied for probation only after the Court of Appeals had affirmed his conviction, petitioner was clearly precluded from the benefits of probation.

G.R. No. L-27365 Case Digest

G.R. No. L-27365, January 30, 1970

Felix Lazo, Mercedes Castro de Lazo and Jose Robles

Vs. Republic Surety and Insurance Co., Inc. represented by Antonio Koh, General Manager and as Attorney-in-fact of plaintiffs, Felix and Mercedes Lazo

Ponente: Makalintal

Facts:

December 12, 1963, plaintiffs spouses Lazo filed a complaint against Republic Surety and Insurance co., and its general manager Antonio Koh, the sheriff of Manila and the Register of Deeds of Manila. The spouses Lazo alleged that they guaranteed a loan between Jose Robles and the Philippine Bank of Commerce amounting to P12, 000.00 executed on August 18, 1953. The loan is executed with a real estate mortgage which was foreclosed extra-judicially on July 1, 1958 and sold to the mortgagee. Antonio Koh pursuant to the mortgage right, executed a deed of absolute sale of the foreclosed property. Because of which, the certificate of title of the spouses Lazo was cancelled and a new one was issued in the name of the company.

In a motion to dismiss filed by the defendants, they raised two issues: (a) that the complaint did not state a cause of action and the claim or demand set forth therein had already prescribed; (b) under the rules of court, an accounting could be demanded only in cases where real property is sold on execution by virtue of a final judgment. In the present case, the defendants maintained the redemption period had already expired when the action was commenced.

Issue: Whether or not the plaintiffs were entitled to the accounting sought by them; whether or not the right of redemption with respect to the foreclosed property was still available; whether the foreclosure is valid or not.

The RTC ruled that the transfer of the loan to the Republic Investment Co., Inc. constituted a novation of the obligation, and that the defendant company was released from its liability as co-debtor because it does not appear to have signed the new promissory note executed by the plaintiffs. Consequently, the court concluded, the real estate mortgage in favor of said defendant was extinguished, and the foreclosure thereof was a nullity.

The actuation of the trial court was not legally permissible especially because the theory on which it proceeded involved factual considerations neither touched upon the pleadings nor made the subject of evidence at the trial. Rule 6, Section 1, is quite explicit in providing that "pleadings are the written allegations of the parties of their respective claims and defenses submitted to the court for trial and judgment."

Held:

(1)    The parties admitted that the mortgage was valid and subsisting, therefore, to establish such premise was unnecessary and uncalled for.

(2)    The actuations of the parties after the mortgage was foreclosed, shows with overwhelming preponderance that the said mortgage had not been extinguished.

(3)    Implicit in the application of these provisions is the premise that the period for redemption of the property sold on execution (on extrajudicial foreclosure of mortgage in the present case) has not yet expired. For if the right to redeem has been lost it stands to reason that there is no redemption price to speak of, to which the rents received by the purchasers are to be applied or credited.

(4)    The plaintiffs' position is that since the sheriff's certificate of sale was recorded in the office of the Register of Deeds for Manila on March 28, 1963, the one-year period of legal redemption had not yet expired when the action was commenced on December 12 of the same year.

(5)    It is clear, in the light of the facts and circumstances above set forth, that the parties had abandoned entirely the concept of legal redemption in this case and converted it into one of conventional redemption, in which the only governing factor was the agreement between them. The registration of the certificate of sale on March 28, 1963 was entirely unnecessary and irrelevant to the question of when the period of redemption agreed upon expired.

G.R. No. 124354 Case Digest

G.R. No. 124354, December 29, 1999

Rogelio Ramos and Erlinda Ramos (as guardians)

vs. Court of Appeals

Ponente: Kapunan           

Issue:

The court is called upon to rule whether a surgeon, an anesthesiologist and a hospital should be made liable for the unfortunate comatose condition of a patient scheduled for cholecystectomy.

Facts:

Erlinda Ramos experiencing a discomfort allegedly caused by the stone in her gall bladder sought professional advice. She was advised to undergo an operation for the removal of a stone in her gall bladder. She underwent series of examination and was declared fit for surgery.  Through the intercession Dr. Buenviaje, Erlinda and her husband met Dr. Hosaka and agreed to have the operation on June 17, 1985.

On the day of the operation, (according to Dr. Hosaka) something went wrong during the intubation. Rogelio, the husband reminded the doctor that the condition of his wife would not have happened, had he looked for a good anesthesiologist. Due to such, Erlinda stayed at the ICU for a month.

The petitioners filed a civil case for damages with the RTC of Quezon City against the respondents alleging negligence in the management and care of Erlinda Ramos. During the trial, the plaintiff presented the testimonies of Dean Herminda Cruz and dr. Gavino (present during the operation) to prove that the sustained by Erlinda was due to lack of oxygen in her brain caused by the faulty management of her airway by the respondent during the anesthesia phase. Respondent relied on the expert testimony of Dr. Jamora, a pulmonologist, to the effect that the cause of brain damage was Erlinda’s allergic reaction to the anesthetic agent.

After considering the evidences, RTC rendered judgment in favor of petitioners. Private respondents interposed an appeal to the Court of Appeals. CA rendered a decision reversing the findings of the RTC.  The decision of the CA was mistakenly received and has caused for the expiration of the reglementary period for the petitioners. The petitioners then filed for a motion for extension of time to file a motion for reconsideration, however the CA denied the motion for extension.

In aid of a new counsel, the petitioners were granted extension of 30 days. The petitioners alleged the following issues: (a) CA erred in putting much reliance on the testimonies of respondents DR. Guttierrez, Dr. Calderon and Dr. Jamora; (b) in finding that the negligence of the respondents did not cause the unfortunate comatose condition of the petitioner; (c) in not applying the doctrine of res ipsa loquitor [the thing speaks for itself]

Held:

(1)    The denial of reglementary period is erroneous, because the delay is attributable to the fact that the decision was not sent to the counsel on records of the petitioners. It is elementary that when a party is represented by counsel, all notices should be sent to the party’s lawyer at his given address.

(2)    Res ipsa loquitor is a maxim for the rule that the fact of the occurrence of an injury, taken with the surrounding circumstances, may permit an inference or raise a presumption of negligence, or make out a plaintiff’s prima facie case and present a question of fact for defendant to meet an explanation. This maxim is not applicable for substantive law thus mere invocation and application of the doctrine does not dispense with the requirement of proof of negligence. Before the doctrine may be applied, the following requisites must be present: (a) the accident is a kind which ordinarily does not occur in the absence of someone’s negligence; (b) it is caused by an instrumentality within the exclusive control of the defendant of defendants; (c) the possibility of contributing conduct which would make the plaintiff responsible is eliminated. [The control must be shown especially]. Medical malpractice does not escape from the application of this doctrine. Applying the maxim, we find that the damage caused by Erlinda is attributable to the negligence of her doctors.

(3)    As to the testimonies relied by the CA, we disagree. We hold that private respondents were unable to disprove the presumption of negligence on their part in the care of Erlinda and their negligence was the proximate cause of her piteous condition. Dr. Jamora does not qualify as an expert witness based on the standard set by the rules of evidence [Sec. 49. Opinion of expert witness – the opinion of a witness on a matter requiring special knowledge, skill, experience or training which he is shown to possess, may be received in evidence.]. The alleged allergic reaction has no proof as well.

(4)    The court believes that the faulty intubation is the proximate cause of the comatose condition of the patient. Proximate cause is a natural and continuous sequence, unbroken by any efficient intervening cause, produces injury, and without which the result would not have occurred.

The doctors as well as the hospital was held liable for the injury incurred by Erlinda, due to their negligence in the operation and management for the hospital.

G.R. No. L-32957-8 Case Digest

G.R. No. L-32957-8 July 25, 1984

People of the Philippines

Vs. Pantaleon Pacis, Eliseo Navarro, Guillermo Agdeppa and Gines Dominguez

Ponente: Concepcion, Jr.

Facts:

This is an appeal of the accused Guillermo from the judgment of the CFI of Cagayan finding him guilty of the crime of frustrated murder.

On November 15, 1967 in the municipality of Sanchez Mira, province of Cagayan, the accused conspired together, armed with guns, with the intent to kill, with treachery and with evident premeditation and taking advantage of superior strength and feloniously attacked and shot Manuel Franco which caused his instantaneous death.

Pacis, one of the appellants and Negre were contenders for the position of mayor in Mira. Pacis was the candidate of the Nacionalista party and was the incumbent mayor, Negre was the candidate of the Liberal party. Franco, the deceased was the incumbent vice-mayor of Pacis but now the campaign manager of Negre.

In the morning of November 15, 1967, the day of the election, Franco and Basco went to Namunac Elementary school to get the election results from the precincts. Of which the two contenders met and from which the firing of gunshots came about.

Agdeppa denied participation in the commission of crimes and interposed an alibi. According to him, he was in Taguiporo where he was employed in the Agricultural Extension Office, at the time of the shooting incident occurred in Namuac. To support the alibi, he presented in evidence the time record he had accomplished and testimony of Jose Tabian who allegedly rode with him on his motorcycle.

The CFI, however, rejected the defense saying that the evidence of the prosecution is more worthy of credence. CFI specially cited the testimony of Basco which, is to its mind, more credible. Counsel for the appellant now contends that the CFI erred in convicting the appellant, citing the maxim of “falsus in uno falsus in omnibuss” [false in one thing is false in everything]

However, the maxim is not a positive law, neither is it an inflexible one of universal application. The testimony of a witness may be believed in part and disbelieved in part. The counsel for the appellant also claims that the bullet marks on the cement conclusively show that the shooting came from the street and not from the truck where Pacis, Navarro and Agdeppa were standing. The trial court discounted the theory.

Issue: Whether the CFI erred in convicting the accused.

Held:

The appellants defense of alibi has nothing to support except the doubtful testimony of Tabian and there is no conclusive evidence that it was physically impossible for the accused to be at the Namuac School which is only 18 kilometers from his office. 

G.R. No. L-15121 Case Digest

G.R. No. L-15121, August 31, 1962

Gregorio Palacio and Mario Palacio (minor)

vs Fely Transportation Company

Ponente: Regala

                      

Facts:

In their complaint, the Palacio alleged that Fely hired Alfredo Canillo as driver who negligently run over a child (Mario). Gregorio , the father of Mario is a welder and in the account of his child's injuries has abandoned his shop which is the family's source of income.

Fely filed a motion to dismiss on the grounds that there is no cause of action against the company and that the cause of action is barred by prior judgment. But the court deferred the determination of the grounds alleged in the motion to dismiss until the trial of the case.

The defendant then alleges (1) that complaint states no cause of action against defendant, and (2) that the sale and transfer of the jeep AC-687 by Isabelo Calingasan to the Fely Transportation was made on December 24, 1955, long after the driver Alfredo Carillo of said jeep had been convicted and had served his sentence.

In view of the evidence presented, the lower court barred the judgment in the criminal case and held that the person subsidiarily liable to pay damages is Isabel Calingasan, the employer.

Issue: Whether Fely Transportation can be held liable for the damages.

Ruling:

The Court agrees with this contention of the plaintiffs. Isabelo Calingasan and defendant Fely Transportation may be regarded as one and the same person. It is evident that Isabelo Calingasan's main purpose in forming the corporation was to evade his subsidiary civil liability resulting from the conviction of his driver, Alfredo Carillo. This conclusion is borne out by the fact that the incorporators of the Fely Transportation are Isabelo Calingasan, his wife, his son, Dr. Calingasan, and his two daughters.

Accordingly, defendants Fely Transportation and Isabelo Calingasan should be held subsidiarily liable for P500.00 which Alfredo Carillo was ordered to pay in the criminal case and which amount he could not pay on account of insolvency.

G.R. No. L-41337 Case Digest

G.R. No. L-41337, June 30, 1988

Tan Boon Bee & Co., Inc.

vs The Hon. Hilarion Jarencio and Graphic Publishing, Inc., and Phil. American Can Drug Company

Ponente: Paras

Facts:

Tan is doing business under the name and style of Anchor Supply Co., sold on credit to Graphics paper products. On December 20, 1972, Graphic made partial payment by check to Tan. Then on 1973 Graphic failed to pay, in consequence, a writ of execution was issued by respondent judge, but the a fore stated writ having expired without the sheriff finding any property of Graphic, an alias writ of execution was issued on July 2, 1974.

Pursuant to the alias writ of execution, the sheriff levied upon 1 unit printing machine found in the premises of Graphic, which is scheduled for auction sale. Then PADCO desist the sheriff from taking the machine saying that the machine is not a property of Graphic. Notwithstanding the letter of PADCO, the sheriff proceeded with the auction sale and sold the property to Tan. Thereafter, the CFI nullified the sale and ruled in favor of PADCO.

Tan filed a motion for reconsideration but the same was denied for lack of merit. Hence,this petition.

Issue:

Whether the Judge gravely abused his discretion when he refused to pierce the PADCO;s identity.

Ruling:

Petitioner's evidence established that PADCO was never engaged in the printing business; that the BOD and officers of Graphic and PADCO were the same; that PADCO holds 50% of stock of Graphic. It was also extablished that the machine was in the premises of Graphics since May 1965 long before PADCO even acquired its alleged title in July 11, 1966.

Thus, respondent judge should pierced PADCO's veil of corporate identity.  

A.M. No. R-181-P Digest

A.M. No. R-181-P, July 31, 1987

Adelio Cruz

vs Quiterio Dalisay

Ponente: Fernan

Facts:

Dalisay, attached and levied the money belonging to complainant Cruz when he was not himself the judgment debtor in the final judgment of NLRC sought to be enforced but rather the company known as "Qualitrans Limousine Service, Inc." a duly registered corporation.

In his comments, Dalisay explained that he is just ding his ministerial duty. While it is true that the writ was addressed to the company, yet Cruz executed an affidavit stating that he is the owner of the company, and because of that, the counsel for the plaintiff advised him to serve notice of garnishment on the Philtrust Bank.

Ruling:

We hold that Dalisay's action calls for disciplinary action, especially for an officer directly connected with the administration of justice and the execution of judgments, must at all times be free from the appearance of impropriety.

G.R. No. 125986 Case Digest

G.R. No. 125986, January 28, 1999

Luxuria Homes Inc., and Aida Posadas

vs Hon. Court of Appeals, James Builder Construction and Jaime Bravo

Ponente: Martinez

Facts:

Aida and her 2 minor children co-owned a 1.6 hectare property in Sucat, Muntinlupa which was occupied by squatters. Aida then contracted Bravo regarding the development of the property and to negotiate with the squatters. 7 months later, Aida and her children assigned the property to Luxuria Homes, Bravo was a witness to the execution of the deed of assignment and the articles of incorporation of Luxuria.

Then in 1992, the relationship between Aida and Bravo turned sour, which resulted to Bravo demanding payment for services rendered in connection with the development of the land. Aida, refuses to pay. Thus, James Builder and Bravo initiated a complaint against Aida and Luxuria Homes.

The trial court declared Aida in default and ordered Aida, jointly and in solidum with Luxuria to pay Bravo. Aggrieved, Aida appealed to the CA. The CA then modified the decision of the trial court and deleted the award of moral damages on the ground that James Builder is a corporation and hence could not experience physical suffering and mental anguish.

Issue: Can petitioner Luxuria Homes be held liable to private respondents for the transactions supposedly entered into between Aida and Bravo?

Ruling:

We hold that the CA committed a reversible error in making Luxuria Homes liable. It cannot be said that the incorporation of Luxuria Homes and eventual transfer of the subject property to it were in fraud of private respondent as such were done with full knowledge of Bravo himself.

To disregard the separate juridical personality of a corporation, the wrong doing must be clearly and convincingly established. It cannot be presumed.

G.R. No. L-14441 Case Digest

G.R. No. L-14441, December 17, 1966

Pedro R. Palting

vs Sanjose Petroleum Inc.

Ponente: Barrera

Facts:

San Jose Petroleum a corporation organized and existing in the Republic of Panama, PETROLEUM filed with the Philippine Securities and Exchange Commission a sworn registration statement, for the registration and licensing for sale in the Philippines Voting Trust Certificates.

It was alleged that the entire proceeds of the sale of said securities will be devoted or used exclusively to finance the operations of San Jose Oil Company, Inc. which is a domestic mining corporation. Pedro R. Palting and others, allegedly prospective investors in the shares of SAN JOSE PETROLEUM, filed with the Securities and Exchange Commission an opposition to registration and licensing of the securities on the grounds that the tie-up between SAN JOSE PETROLEUM, and SAN JOSE OIL, violates the Constitution of the Philippines, the Corporation Law and the Petroleum Act of 1949.

Issue:

Whether or not the "tie-up" between the respondent SAN JOSE PETROLEUM, and SAN JOSE OIL COMPANY, INC., is violative of the

Constitution, the Laurel-Langley Agreement, the Petroleum Act of 1949

Held:

Yes. In the 1946 Ordinance Appended to the Constitution, this right was extended to citizens of the United States; states that to all forms of business enterprises owned or controlled, directly or indirectly, by citizens of the United States in the same manner as to, and under the same conditions imposed upon, citizens of the Philippines or corporations or associations owned or controlled by citizens of the Philippines, would have the privilege of disposition, exploitation, development, and utilization of all Philippine natural resources. However, respondent is owned, controlled, directly and indirectly by Panamanian Corporation.

The Laurel-Langley Agreement also states that with respect to natural resources in the public domain in the Philippines, only through the medium of a corporation organized under the laws of the Philippines and at least 60% of the capital stock of which is owned or controlled by citizens of the United States.

Although it was claimed that the corporation has stockholders residing in United States, there was no indication if they are all citizens of America, how much percentage do they occupy as stockholders, and if they have the same rules that apply to the conditions mentioned. In the circumstances, the court ruled that the respondent SAN JOSE PETROLEUM, as presently constituted, is not a business enterprise that is authorized to exercise the parity privileges under the Parity Ordinance, the Laurel-Langley Agreement and the Petroleum Law. Its tie-up with SAN JOSE OIL is, consequently, illegal.

The parity rights agreement is not applicable to SJP. The parity rights are only granted to American business enterprises or enterprises directly or indirectly controlled by US citizens. SJP is a Panamanian corporate citizen. The other owners of SJO are Venezuelan corporations, not Americans. SJP was not able to show contrary evidence. Further, the Supreme Court emphasized that the stocks of these corporations are being traded in stocks exchanges abroad which renders their foreign ownership subject to change from time to time. This fact renders a practical impossibility to meet the requirements under the parity rights. Hence, the tie up between SJP and SJO is illegal, SJP not being a domestic corporation or an American business enterprise contemplated under the Laurel-Langley Agreement.

G.R. No. 75885 Case Digest

G.R. No. 75885, May 27, 1987

Bataan Shipyard & Engineering Co

vs. PCGG

Ponente: Narvasa

Facts:

Bataan Shipyard and Engineering Co., Inc (BASECO) – private corporation

Presidential Commission on Good Government (PCGG) – issued the sequestration order

The corporation known as BASECO was owned or controlled by President Marcos during his administration, through nominees, by taking undue advantage of his public office and/or using his powers, authority, or influence, and that it was by and through the same means, that BASECO had taken over the business and/or assets of the National Shipyard and Engineering Co., Inc., and other government-owned or controlled entities.

As evidence found in Malacanang shortly after the sudden flight of President Marcos were certificates corresponding to more than ninety-five percent (95%) of all the outstanding shares of stock of BASECO, endorsed in blank, together with deeds of assignment of practically all the outstanding shares of stock of the three (3) corporations above mentioned (which hold 95.82% of all BASECO stock), signed by the owners thereof although not notarized. While the petitioner's counsel was quick to dispute this asserted fact, assuring the Court that the BASECO stockholders were still in possession of their respective stock certificates and had never endorsed them in blank or to anyone else, that denial is exposed by his own prior and subsequent recorded statements as a mere gesture of defiance rather than a verifiable factual declaration.

In accordance with Executive Orders Numbered 1 and 2 promulgated by President Corazon Aquino, PCGG through its commissioners and agent ordered sequestration, takeover and other provisional orders affecting BASECO.

Commissioner Diaz invoked the provisions of Section 3 (c) of Executive Order No. 1, empowering the Commission —To provisionally takeover in the public interest or to prevent its disposal or dissipation, business enterprises and properties taken over by the government of the Marcos Administration or by entities or persons close to former President Marcos, until the transactions leading to such acquisition by the latter can be disposed of by the appropriate authorities.

Issues:

1.      Are the provisional remedies involved in this case unconstitutional?

2.      Are the acts of PCGG and its Commissioners done without or in excess of its powers or with grave abuse of discretion?

3.      Was there a violation of the right against self-Incrimination and unreasonable searches and seizures?

Ruling:

1. No.

The Provisional or "Freedom" Constitution recognizes the power and duty of the President to enact "measures to achieve the mandate of the people to recover ill- gotten properties amassed by the leaders and supporters of the Marcos regime and protect the interest of the people through orders of sequestration or freezing of assets or accounts. And as also already adverted to, Section 26, Article XVIII of the 1987 Constitution treats of, and ratifies the authority to issue sequestration or freeze orders under Proclamation No. 3. The institution of these provisional remedies is also premised upon the State's inherent police power, regarded, as t lie power of promoting the public welfare by restraining and regulating the use of liberty and property, and as the most essential, insistent and illimitable of powers in the promotion of general welfare and the public interest, and said to be co-extensive with self-protection and not inaptly termed also the law of overruling necessity.

2. No, PCGG’s general function is to conduct investigations in order to collect evidence establishing instances of ill-gotten wealth, issue sequestration, and such orders as may be warranted by the evidence thus collected and as may be necessary to preserve and conserve the assets of which it takes custody and control and prevent their disappearance, loss or dissipation; and eventually file and prosecute in the proper court of competent jurisdiction all cases investigated by it as may be warranted by its findings. It does not try and decide, or hear and determine, or adjudicate with any character of finality or compulsion, cases involving the essential issue of whether or not property should be forfeited and transferred to the State because ill-gotten within the meaning of the Constitution and the executive orders.

3. No. The right against self-incrimination has no application to juridical persons. While an individual may lawfully refuse to answer incriminating questions unless protected by an immunity statute, it does not follow that a corporation, vested with special privileges and franchises, may refuse to show its hand when charged with an abuse of such privileges.

G.R. No. L-3869 Case Digest

G.R. No. L-3869, January 31, 1952

S. David Winship

vs Philippine Trust Company

Ponente: Paras

Facts:

Prior to December 1941, the Eastern Isles Import Corporation, which is mainly owned by American citizens, had a current account deposit with the Phil Trust Company. Then later, the Japanese administration issued an order requiring all deposit accounts of the hostile people to be transferred to the bank of Taiwan. In compliance, Phil. Trust transferred and paid the credit balances of the current account deposits of the corporation to the bank of Taiwan.

The pre-war current deposit accounts of the Eastern Isles Import Corporation and of the Eastern Isles, Inc. were subsequently transferred to S. Davis Winship who, on August 12, 1947, presented to the Philippine Trust Company checks Nos. A-79212 and H-579401 covering the aforesaid deposits. The Philippine Trust Company, however, refused to pay said checks, whereupon, on September 6, 1947, S. Davis Winship instituted the present action against the Philippine Trust Company in the Court of First Instance of Manila, to recover upon the first cause of action the sum of P51,410.91 and under the second cause of action the sum of P34,827.74.

In its answer, the defendant Philippine trust Company invoked the order of the Japanese Military Administration by virtue of which it transferred the current deposit accounts in question to the Bank of Taiwan as the depository of the Bureau of Enemy Property Custody of the Japanese Military Administration.

After trial, the Court of First Instance of Manila rendered a decision upholding the contention of the defendant and accordingly dismissing the complaint.

Ruling:

In view of this pronouncement, we have to affirm the appealed judgment. As it has been stipulated by the parties that the defendant transferred the deposits in question to the Bank of Taiwan in compliance with the order of the Japanese Military Administration, the defendant was released from any obligation to the depositors or their transferee. Appellant's contention that there is no positive showing that the transfer was made by the Philippine Trust Company in compliance with the order of the Japanese Military Administration, and its logical effect is to make such act binding on said company. At any rate, the defendant corporation has not impugned its validity.

In the case of Filipinas Compañia de Seguros vs. Christern Henefeld and Co., Inc., Phil., 54, we held that the nationality of a private corporation is determined by the character or citizenship of its controlling stockholders; and this pronouncement is of course decisive as to the hostile character of the Eastern Isles, Inc., as far as the Japanese Military Administration was concerned, it being conceded that the controlling stockholders of said corporations were American citizens.

Wherefore, the appealed judgment is affirmed, with costs against the appellant.

G.R. No. L-2294 Case Digest

G.R. No. L-2294, May 25, 1951

Filipinas Compania de Seguros

vs Christen, Huenefeld and Co., Inc.

Ponente: Paras

Facts:

October 1941, Respondent Corporation obtained from the petitioner Filipinas fire policy covering the merchandise contained in a building located in Binondo, Manila. Then during the Japanese military occupation, the building and insured merchandise were burned. In due time, the corporation submitted its claim under the policy. The petitioner refused to pay the claim on the ground that the policy had ceased to be in force on the date US declared war against Germany, the respondents corporation.

The theory of the petitioner is that the insured merchandise were burned up after the policy issued in 1941 in favor of the respondent corporation has ceased to be effective because of the outbreak of the war between the United States and Germany on December 10, 1941, and that the payment made by the petitioner to the respondent corporation during the Japanese military occupation was under pressure. After trial, the Court of First Instance of Manila dismissed the action without pronouncement as to costs. Upon appeal to the Court of Appeals, the judgment of the Court of First Instance of Manila was affirmed, with costs. The case is now before us on appeal by certiorari from the decision of the Court of Appeals.

The Court of Appeals overruled the contention of the petitioner that the respondent corporation became an enemy when the United States declared war against Germany, relying on English and American cases which held that a corporation is a citizen of the country or state by and under the laws of which it was created or organized. It rejected the theory that nationality of Private Corporation is determined by the character or citizenship of its controlling stockholders.

There is no question that majority of the stockholders of the respondent corporation were German subjects. This being so, we have to rule that said respondent became an enemy corporation upon the outbreak of the war between the United States and Germany. The Philippine Insurance Law (Act No. 2427, as amended,) in section 8, provides that "anyone except a public enemy may be insured." It stands to reason that an insurance policy ceases to be allowable as soon as an insured becomes a public enemy.

The respondent having become an enemy corporation on December 10, 1941, the insurance policy issued in its favor on October 1, 1941, by the petitioner (a Philippine corporation) had ceased to be valid and enforceable, and since the insured goods were burned after December 10, 1941, and during the war, the respondent was not entitled to any indemnity under said policy from the petitioner. However, elementary rules of justice (in the absence of specific provision in the Insurance Law) require that the premium paid by the respondent for the period covered by its policy from December 11, 1941, should be returned by the petitioner.

Issue: Whether the policy in question became null and void upon the declaration of war between US and Germany.

Ruling:

It results that the petitioner is entitled to recover what paid to the respondent under the circumstances on this case. However, the petitioner will be entitled to recover only the equivalent, in actual Philippines currency of P92,650 paid on April 19, 1943, in accordance with the rate fixed in the Ballantyne scale.

Wherefore, the appealed decision is hereby reversed and the respondent corporation is ordered to pay to the petitioner the sum of P77,208.33, Philippine currency, less the amount of the premium, in Philippine currency, that should be returned by the petitioner for the unexpired term of the policy in question, beginning December 11, 1941. Without costs. So ordered.

G.R. No. L-68555 Case Digest

G.R. No. L-68555, March 19, 1993

Prime White Cement Corporation

vs Hon. Intermediate Appellate Court and Alejandro Te

Ponente: Campos, Jr.

Facts:

July 1969, plaintiff and Defendant Corporation thru its President, entered into a dealership agreement whereby plaintiff was obligated to act as the exclusive distributor of the cement products in Mindanao for 5 years.

As a result, some business associates propose to be a sub-dealer in Mindanao. Relying on the dealership agreement, plaintiff entered into a written agreement with several hardware stores dealing in buying and selling white cement in Davao and Cagayan de Oro.

Later on, the defendant corporation decide to impose conditions which were answered by several demands from the plaintiff to comply with the dealership agreement. However, defendant refused to comply. After the trial court adjudged the corporation liable to Alejandro Te, the CA affirmed the said decision based on:

There is no dispute that when Zosimo R. Falcon and Justo B. Trazo signed the dealership agreement Exhibit “A”, they was the President and Chairman of the Board, respectively, of defendant-appellant Corporation. Neither is the genuineness of the said agreement contested. As a matter of fact, it appears on the face of the contract itself that both officers were duly authorized to enter into the said agreement and signed the same for and in behalf of the corporation. When they, therefore, entered into the said transaction they created the impression that they were duly clothed with the authority to do so. It cannot now be said that the disputed agreement which possesses all the essential requisites of a valid contract was never intended to bind the corporation as this avoidance is barred by the principle of estoppel.

Issue: Whether or not the dealership agreement referred by the President and Chairman of he Board of petitioner corporation is  valid and enforceable contract.

Ruling: No, it is not valid.

Under the Corporation Law, which was then in force at the time this case arose, as well as under the present Corporation Code, all corporate powers shall be exercised by the Board of Directors, except as otherwise provided by law. Although it cannot completely abdicate its power and responsibility to act for the juridical entity, the Board may expressly delegate specific powers to its President or any of its officers. In the absence of such express delegation, a contract entered into by its President, on behalf of the corporation, may still bind the corporation if the board should ratify the same expressly or impliedly.

Furthermore, even in the absence of express or implied authority by ratification, the President as such may, as a general rule, bind the corporation by a contract in the ordinary course of business, provided the same is reasonable under the circumstances. These rules are basic, but are all general and thus quite flexible. They apply where the President or other officer, purportedly acting for the corporation, is dealing with a third person, i. e., a person outside the corporation.

The situation is quite different where a director or officer is dealing with his own corporation. In the instant case respondent Te was not an ordinary stockholder; he was a member of the Board of Directors and Auditor of the corporation as well. He was what is often referred to as a "self-dealing" director. A director of a corporation holds a position of trust and as such, he owes a duty of loyalty to his corporation. In case his interests conflict with those of the corporation, he cannot sacrifice the latter to his own advantage and benefit.

G.R. No. 141855 Case Digest

G.R. No. 141855, February 6, 2001

Zacarias Cometa and Herco Realty & Agricultural Corp.

vs Court of Appeals and Jose Franco

Ponente: Ynares-Santiago

Facts:

CFI awarded to Cometa the sum of P57, 396.85 of which the sheriff levied on 3 commercial lots of Cometa located in Makati. 2 of the lots were sold to Franco at public auction.

Later, Herco Realty filed a civil case to annul the levy on execution and sale of the real properties alleging that the ownership of the lots had been transferred by Cometa to Herco before the execution of the sale. It also assailed the legality of the levy contending that the personal properties of Cometa must be exhausted first.

Meanwhile, the RTC Branch 60 issued an order directing the Register of Deeds to cancel the certificates of title of Cometa and to issue new ones in favor of Franco.

Issue: Whether the levy and sale is valid and proper. For if the respondent acquired no interest in the property by virtue of the levy and sale, then, he is not entitled to its possession.

Ruling:

There is no question that petitioners were remiss in attending with dispatch to the protection of their interests as regards the subject lots, and for that reason the case in the lower court was dismissed on a technicality and no definitive pronouncement on the inadequacy of the price paid for the levied properties was ever made. In this regard, it bears stressing that procedural rules are not to be belittled or dismissed simply because their non-observance may have resulted in prejudice to a party’s substantive rights as in this case. Like all rules, they are required to be followed except only when for the most persuasive of reasons they may be relaxed to relieve a litigant of an injustice not commensurate with the degree of his thoughtlessness in not complying with the procedure prescribed.

While there is no dispute that mere inadequacy of the price per se will not set aside a judicial sale of real property, nevertheless, where the inadequacy of the price is purely shocking to the conscience, such that the mind revolts at it and such that a reasonable man would neither directly or indirectly be likely to consent to it, the same will be set aside.

The subject lots were sold en masse, not separately as above provided. The unusually low price for which they were sold to the vendee, not to mention his vehement unwillingness to allow redemption therein, only serves to heighten the dubiousness of the transfer.

With regard to the applicability of prescription and laches, there can be no question that they operate as a bar in equity. However, it must be pointed out that the question of prescription or laches cannot work to defeat justice or to perpetrate fraud and injustice.

The rule on redemption is liberally construed in favor of the original owner of the property and the policy of the law is to aid rather than defeat him in the exercise of his right of redemption. Thus, we allowed parties in several cases to perfect their right of redemption even beyond the period prescribed therefore.

WHEREFORE, in view of all the foregoing, the challenged Decision of the Court of Appeals dated January 25, 1999, which affirmed the trial court’s denial of petitioners right of redemption, as well as the subsequent Resolution dated January 27, 2000, in CA-G.R. SP No. 48227 entitled Zacarias Cometa, et al. v. Hon. Pedro Laggui, et al., are REVERSED and SET ASIDE; and another one hereby rendered ordering respondent Jose Franco to accept the tender of redemption made by petitioners and to deliver the proper certificate of redemption to the latter.

G.R. No. L-30896 Case Digest

G.R. No. L-30896, April 28, 1983

Jose Sia

vs The people of the Philippines

Ponente: De Castro

Facts:

This is a petition for review of the decision of the CA affirming the decision of the CFI of Manila convicting the appellant of estafa.

Based on the information filed, the accused allegedly defraud the Continental Bank, under the obligation on the part of said accused of holding the said steel sheets in trust receipt agreement, which cold rolled steel sheets were consigned to the continental bank.

In reviewing the evidence, the CA came up with the following findings of facts which the solicitor general alleges should be conclusive upon this court:

Sia was general manager of the Metal Manufacturing Company of the Philippines, Inc. engaged in the manufacture of steel office equipment. He applied for a letter of credit to import steel sheets from Mitsui Bussan Kaisha, Ltd. of Japan, the application being directed to the Continental Bank.

Issue: (1) whether Sia, having only acted for and in behalf of the Metal Manufacturing Company of the Philippines as president thereof in dealing with the complainant, the continental bank he may be liable for the crime charged.

Ruling:

(1st issue) In disputing the theory of petitioner, the Solicitor General relies on the general principle that when a corporation commits an act which would constitute a punishable offense under the law, it is the responsible officers thereof, acting for the corporation, who would be punished for the crime, The Court of Appeals has subscribed to this view when it quoted approvingly from the decision of the trial court the following:

A corporation is an artificial person, an abstract being. If the defense theory is followed unscrupulously legions would form corporations to commit swindle right and left where nobody could be convicted, for it would be futile and ridiculous to convict an abstract being that cannot be pinched and confined in jail like a natural, living person, hence the result of the defense theory would be hopeless chose in business and finance. It is completely untenable. (Rollo [CA], p. 108.)

The act is imposed by agreement of parties, as a practice observed in the usual pursuit of a business or a commercial transaction. The offense may arise, if at all, from the peculiar terms and condition agreed upon by the parties to the transaction, not by direct provision of the law. The intention of the parties, therefore, is a factor determinant of whether a crime was committed or whether a civil obligation alone intended by the parties.

In the absence of an express provision of law making the petitioner liable for the criminal offense committed by the corporation of which he is a president as in fact there is no such provisions in the Revised Penal Code under which petitioner is being prosecuted, the existence of a criminal liability on his part may not be said to be beyond any doubt. In all criminal prosecutions, the existence of criminal liability for which the accused is made answerable must be clear and certain. The maxim that all doubts must be resolved in favor of the accused is always of compelling force in the prosecution of offenses. This Court has thus far not ruled on the criminal liability of an officer of a corporation signing in behalf of said corporation a trust receipt of the same nature as that involved herein.

(2nd issue) We consider the view that the trust receipt arrangement gives rise only to civil liability as the more feasible, before the promulgation of P.D. 115. The transaction being contractual, the intent of the parties should govern. The parties, therefore, are deemed to have consciously entered into a purely commercial transaction that could give rise only to civil liability, never to subject the "entrustee" to criminal prosecution.

G.R. No. L-32409 Case Digest

G.R. No. L-32409, February 27, 1971

Bache & Co., etc

vs Hon. Judge Vivencio Ruiz, etc.

Ponente: Villamor

Facts:

Petitioner prays to declare null and void the search warrant issued by the respondent judge against the petitioner corporation.

Allegedly, Judge Ruiz issued a search warrant against petitioners for violation of the National Internal Revenue Code by authorized Revenue Examiner de Leon to mail and file the application for search warrant. 3 days later, BIR agents served the warrant at the petitioner’s offices. Petitioner's lawyers protested the search on the ground that no formal complaint or transcript of testimony was attached to the warrant. The agents nevertheless proceeded with their search and yielded 6 boxes of documents.

Later, petitioners filed a petition with the CFI praying that the search warrant be quashed and declared null and void, with damages and attorney's fees. In the meantime, the BIR made a tax assessment on petitioner based on the documents seized, with the following reasons: (1) Judge Ruiz failed to personally examine the complaint and his witness. (2) The search warrant was issued for more than one specific offense. (3) The search warrant did not describe the things to be seized.

Ruling:

PREMISES CONSIDERED, the petition is granted. Accordingly, Search Warrant No. 2-M-70 issued by respondent Judge is declared null and void; respondents are permanently enjoined from enforcing the said search warrant; the documents, papers and effects seized there under are ordered to be returned to petitioners; and respondent officials the Bureau of Internal Revenue and their representatives are permanently enjoined from enforcing the assessments mentioned in Annex "G" of the present petition, as well as other assessments based on the documents, papers and effects seized under the search warrant herein nullified, and from using the same against petitioners in any criminal or other proceeding. No pronouncement as to costs.