==========Case No. 41: Rule in the interpretation of Corporate Law provisions ======= vs. EASTE THE HOME INSURANCE COMPANY, COMPANY, Petitioner , vs. EASTERN RN SHIPPI SHIPPING NG LINES LINES and/o and/or r ANGEL ANGEL JOSE JOSE TRANSPORTATION, TRANSPORTATION, INC. Respondent . G. R. L-34382, July 20, 1983 FACTS: On or about January 13, 1967, S. Kajikita & Co. on board the SS ‘Eastern Jupiter,’ which is owned by the respondent, from Osaka, Japan coils of “Black Hot Rolled Copper Wires Rods.” The shipment was covered by Bill of Lading with arrival notice to the Phelps Dodge Copper Products Corporation, the consignee. It was also insured with the plaintiff against all risks in the amount of P1,580,105.06. The coils discharged from the vessel were in bad order, consisting of loose and partly cut coils which had to be considered scrap. The plaintiff paid the consignee under insurance the amount of P3,260.44 for the loss/damage suffered by the cargo. Plaintiff, a foreign insurance company duly authorized to do business in the Philippines, made demands for payment of the aforesaid amount against the carrier and transportation company for reimbursement of the aforesaid amount, but each refused to pay the same. The Eastern Shipping Lines filed its answer and denied the allegations of Paragraph I which refer to the plaintiff’s capacity to sue for lack of knowledge or information sufficient to form a belief as to the truth thereof. Angel Jose Transportation, on the other hand, admitted the jurisdictional averments in paragraphs 1, 2 and 3 of the heading parties. The Court of First Instance dismissed the complaint on the ground that the appellant had failed to prove its capacity to sue. The petitioner then filed a petition for review on certiorari. ISSUE: Whether or not that the trial court erred in dismissing the finding that plaintiff-appellant has no capacity to sue. RULING: The court held that the objective of the law is to subject the foreign corporation to the jurisdiction of our court. The Corporation Law must be given reasonable, not an unduly harsh interpretation which does not hamper the development of trade relations and which fosters friendly commercial intercourse among countries. Counsel for appellant contends that at the time of the service of summons, the appellant had not yet been authorized to do business. But, the lack of capacity at the time of the execution of the contracts was cured by the subsequent registration is also strengthened by the procedural aspects of the case. The court find the general denials inadequate to attack the foreign corporations lack of capacity to sue in the light of its positive averment that it is authorized to do so. Section 4, Rule 8 requires that "a party desiring to raise an issue as to the legal existence of any party or the capacity of any party to sue or be sued in a representative capacity shall do so by specific denial, which shall include such supporting particulars as are particularly within the pleader's knowledge. At the very least, the private respondents should have stated particulars in their answers upon which a specific denial of the petitioner's capacity to sue could have been based or which could have supported its denial for lack of knowledge. And yet, even if the plaintiff's lack of capacity to sue was not properly raised as an issue by the answers, the petitioner introduced documentary evidence that it had the authority to engage in the insurance business at the time it filed the complaints. The Supreme Court granted the petition, reversing the decision of the lower court. Laws=========== ======Case No. 42: Rule in the construction of Naturalization Laws=========== Benjamin Co vs. Republic of the Philippines GR L-12150, 26 May 1960 Facts: Petitioner was born in Abram and his parents are both Chinese. He owes his allegiance to theNationalist Government of China. He is married to Leonor Go, the marriage having been celebrated inthe Catholic Church of Bangued. He speaks and writes English as well as the Ilocano and Tagalog dialects. He graduated from the Abram Valley College, and finished his primary studies in the “Colegio” in Bangued, both schools being recognized by the government. He has a child two months old. He has never been accused of any crime involving moral turpitude. He is not opposed to organized government, nor is he a member of any subversive organization. He does not believe in, nor practice, polygamy. Since his birth, he has never gone abroad. He mingles with the Filipinos. He prefers a democratic form of government and stated that if his petition is granted he would serve the government either in the military or civil department. He is a merchant dealing in the buy and sell of tobacco. He also is part owner of a store in Bangued. In his tobacco business, he has a working capital of P10, 000.00 which he claims to have been accumulated thru savings. He contributes to civic and charitable organizations like the Jaycees, Rotary, Red Cross and to town fiestas. He likes the customs of the Filipinos because he has resided in the Philippines for a long time. During the year 1956, he claims to have
earned P1, 000.00 in his tobacco business. With respect to the store of which he claims to be a part owner, he stated that his father gave him a sum of less than P3, 000.00 representing one-fourth of the sales. Aside from being a co-owner of said store, he receives a monthly salary of P120, 00as a salesman therein. He took a course in radio mechanics and completed the same in 1955. He has no vice of any kind. He claims that he has never been delinquent in the payment of taxes. But he admitted that he did not file his income tax return when he allegedly received an amount of not less than P3, 000 from his father which he claims to have invested in his tobacco business. A petition for naturalization was filed before the trial court in which after hearing was granted. Court ordered that a certificate of naturalization be issued to petitioner after the lapse of two years from the date the decision becomes final and all the requisites provided for in Republic Act 503 have been complied. Issue: Whether or not the lower court erred in granting the petition for naturalization. Decision: Philippine law requires that an alien must conduct himself in a proper and irreproachable manner during the entire period of his residence in the Philippines in his relation with the constituted government as well as with the community in which he is living. In the case at bar, petitioner’s failure to comply with his obligation to register his wife and child with the Bureau of Immigration as required by the Alien Registration Act as well as his failure to file his income tax return despite his fixed salary of P1, 440.00 a year and his profit of P1, 000.00 in his tobacco business indicates that he failed to conduct himself in a proper and irreproachable manner in his relation with our government. It is also claimed that he has not stated (during the cross-examinations) that he believes in the principles underlying our Constitution. In construction, Naturalization laws should be rigidly enforced and strictly construed in favor of the government and against the applicant. Hence, the petition appealed from is reversed without pronouncement as to cost. ======Case No. 43: Rule in the construction of Naturalization Laws=========== Lee Cho alias Sem Lee vs Republic of the Philippines GR. No. 12408 December 28, 1959 FACTS: Lee Cho alias Sem Lee filed a petition for naturalization. He was born in Amoy, China of Chinese parents and came to the Philippines in 1921. He was given alien certificate of residence and registration and settled in Cebu up to the present time, managing his business. He is married and has 13 children. Though he had his primary and secondary education in Cebu Chinese High School, most of his children are studying on private schools and college recognized by the government and were given alien certificate of registration, except William who is not of school age, Angelita who is out of school, that of Lourdes Lee who married to a naturalized Filipino and Angelita Lee who stopped at her Third year in secondary school. Petitioner Lee Cho by far possesses all qualifications prescribed by the law and is residing in the Philippines for more than 30 years now. Thus he argued exemption from filing declaration of intention to become a Filipino and should be entitled to a Filipino citizenship. ISSUE: Whether or not petitioner Lee Cho failed to comply with the requirement of the Naturalization Law RULING: The petition was denied by the affiliate court and found merit in the contention that he fail to comply with the requirements of the Naturalization Law hence, fail to qualify to become a Filipino citizen. For one, Naturalization requires filing declaration of intention to become a Filipino citizen one year prior to the filing of application which Lee Cho did not accomplished. He will then be exempted from complying with said requirement only (1) if he is born in the Philippines and has received primary and secondary education in any school recognized by the government; or (2) if he has continuously resided in the Philippines for a period of 30 years or more provided that he has given primary and school or in private schools recognized by the government. The petitioner was unable to fulfill any of the two exempting condition. Basis for contention was signified by the case of his children Angelita Lee and Lourdes Lee. While Angelita Lee was deprived with secondary education limiting her exposure to Philippine Civics and History, Lourdes Lee was enrolled on a Chinese School with strict Chinese curriculum. This contradicts petitioner’s desire to embrace Filipino citizenship that comes along with appreciating Philippine History, Civics and Government. This circumstances questioned his sincerity become a Filipino citizen as he have tolerated such deviation from the educational requirement of the law and its nationalistic purpose. =========Case No. 44: Rule in the construction of Agrarian Reform Laws========== Manuel Guerrero and Maria Guerrero vs Hon. Court of Appeals and Apolinario Benitez
GR No. L-44570, May 30, 1986 FACTS: In 1969, Apolinario Benitez was asked by spouses Manuel and Maria Guerrero to take care of their 60 heads of cows and to clean the already fruit-bearing coconut trees and burn dried leaves and grass and, during harvest time, which is usually every three months, to pick coconuts and gather the fallen ones from a 16hectare portion of the 21-hectare plantation and process the meat of the coconut in the copra kiln of the defendants. He had a 1/3 share of the proceeds from the copra that he processed and sold in the market and a P500 a year salary for attending the cows. In 1973, Benitez was keep from doing the job he had always done for almost four years. Thus, he brought the matter to the attention of the Office of Special Unit in the Office of the President in Malacanang, Manila, where spouses Manuel and Maria Guerrero agreed to let Benitez continue working on the 16-hectare portion of the plantation as tenant and that their relationship will be guided by the provisions of RA No. 1199, known as The Agricultural Tenancy Act of the Philippines. However, on July of 1973, he was again refrained from gathering nuts from the 10-hectare and was threatened if he persists. Benitez filed a case for reinstatement with damages. The lower court decided in favor of Benitez, ordering spouses Manuel and Maria Guerrero to reinstate Benitez to the 10-hectare portion of the 16-hectare coconut plantation. Hence, this petition, claiming that Benitez is a mere farmhand and not a tenant. The petitioners contend that the courts applied erroneous definitions of “tenancy” found in repealed laws. They assert that the Agricultural Tenancy Act and the Agricultural Land Reform Code have been superseded by the Code of Agrarian Reforms, Rep. Act 6389, which the trial court and the Court of Appeals failed to cite and apply. ISSUE: Whether a tenancy relationship exists between Manuel Guerrero et al and Apolinario Benitez et al as to determine their respective rights and obligations to one another. RULING: Although Republic Act 3844 abolished and outlawed share tenancy and replaced it with the agricultural leasehold system and Republic Act 6389 amending Republic Act 3844 declared share tenancy relationships as contrary to public policy, the Court contends that the phasing out of share tenancy was never intended to mean a reversion of tenants into mere farmhands or hired laborers with no tenurial rights. Thus, the respondent has been unlawfully deprived of his right to security of tenure. Therefore, the petition is dismissed for lack of merit. The decision of the appellate court is affirmed. ============Case No. 45: Rule in the construction of the Rules of Court============ Bello vs. Court of Appeals G. R. L-38161 (March 29, 1974) FACTS: The petitioner falsely appealed a case to the court of first instance. and taken directly to respondent court. The prosecutor filed a petition to dismiss appeal. Petitioner did not notified the dismissal of their appeal. They filed with the city court their "motion to elevate appeal to Court of Appeals". Respondent city court denied petitioners' motion. Petitioners spouses filed a petition for prohibition and mandamus against people and respondent to prohibit the execution of judgment and elevate the appeal to Respondent Court. They dismissed the petition. Although the respondent recognized that the Court of First Instance may have exercised its inherent powers to direct appeal to Respondent Court, it held that Petitioners did not implead the Court of First Instance as “principal party respondent” and thus it could not “grant any relief at all even on the assumption that Petitioners can be said to deserve some equities”. ISSUE: Whether or Not the case should be elevated to Respondent Court despite the finality of judicial decision. RULING: The Court acted with grave abuse of discretion. The Supreme Court cautions against narrowly interpreting a statute, defeating its purpose and stressed that “it is the essence of judicial duty to construe statutes as to avoid such a deplorable result of injustice or absurdity”. The provision should also be taken within the context and spirit of Rule 50, Sec. 3 as an analogous provision. The Supreme Court finds no reason as to why the court cannot act in all fairness and justice to be bound by the same rule. ========= Case No. 46: Expropriation Laws========= The City of Manila, plaintiff-appellant, vs. Chinese Community of Manila, et al., defendantsappellees. G. R. No. L-145355 October 21, 1919 FACTS:
On December 11, 1916, the City of Manila filed a petition in the Court of First Instance of Manila praying that certain lands be expropriated for the purpose of constructing public improvement--extension of Rizal Avenue. The Chinese Community of Manila, defendants answered the petition and denied that it was either necessary or expedient that the said parcels be expropriated for street purposes; and that the land in question was used for cemetery purposes. The Court of First Instance decided that there was no necessity for the expropriation of the particular strip of land in question. The plaintiff then filed an appeal on the grounds that under the law, it has authority to expropriate any land it may desire and that the courts are mere appraisers of the land involved in expropriation proceedings. ISSUES: Whether or not in expropriation proceedings of the City of Manila, the courts may inquire into, and hear proof upon, the necessity of the expropriation. RULING: When the legislature conferred upon the courts of the Philippine Islands the right to ascertain upon trial whether there exists for the exercise of eminent domain, it intended that the courts should inquire into, and here proof upon, those questions. It is not alleged and not denied, that the cemetery in question may be used by the general community of Chinese, when in fact, in the general acceptation of the definition of a public cemetery, would make the cemetery in question public property. If that is true, then of course, the petition of the plaintiff must be denied, for the reason that City of Manila has no authority or right under the law to expropriate public property. The Supreme Court affirmed the decision of the Court of First Instance of Manila. ===================Case No. 48: Wills ===================== In the matter of the TESTATE ESTATE of PETRONILA TAMPOY vs. DIOSDADA ALBERASTINE G.R. No. L-14322. February 25, 1960 Facts: This concerns the probate of a document which purports to be the last will and testament of Petronila Tampoy. After the petition was published in accordance with law and petitioner had presented oral and documentary evidence, the trial court denied the petition on the ground that the left hand margin of the first page of the will does not bear the thumbmark of the testatrix. Petitioners contend that the will expresses the true intention of the testatrix to give the property to her whose claims remain undisputed. She wishes to emphasize that no one has filed any opposition to the probate of the will and that while the first page does not bear the thumbmark of the testatrix, the second however bears her thumbmark and both pages were signed by the three testimonial witnesses. Moreover, despite the fact that the petition for probate is unopposed, the three testimonial witnesses testified and manifested to the court that the document expresses the true and voluntary will of the deceased. Petitioner appealed from this ruling but the Court of Appeals certified the case to the Supreme Court as it involves purely a question of law. Issue: Petition to probate a will on the ground that the left hand margin of the first page of the document does not bear the thumb mark of the testatrix. Ruling: Section 618 of Act 190, as amended, requires that the testator sign the will and each and every page thereof in the presence of the witnesses, and that the latter sign the will and each and every page thereof in the presence of the testator and of each other, which requirement should be expressed in the attestation clause. This requirement is mandatory, for failure to comply with it is fatal to the validity of the will (Rodriguez vs. Alcala, 55 Phil., 150). Thus, it has been held that "Statutes prescribing the formalities to be observed in the execution of wills are very strictly construed. As stated in 40 Cyc., at page 1097, 'A will must be executed in accordance with the statutory requirements; otherwise it is entirely void.' All these requirements stand as of equal importance and must be observed, and courts cannot supply the defective execution of a will. No power or discretion is vested in them, either to superadd other conditions or dispense with those enumerated in the statutes" (Uy Coque vs. Navas L. Sioca, 43 Phil., 405, 407; See also Saño vs. Quintana, 48 Phil., 506; Gumban vs. Gorecho 50 Phil., 30; Quinto vs. Morata, 54 Phil., 481). Since the will in question suffers from the fatal defect that it does not bear the thumbmark of the testatrix on its first page even if it bears the signature of the three instrumental witnesses, the same still fails to
comply with the law and therefore, cannot be admitted to probate. The order appealed from is affirmed. ===================Case No. 47: Election Laws==================== CRISOLOGO VILLANUEVA Y PARDES, Petitioner, vs. COMMISSION ON ELECTIONS, MUNICIPAL BOARD OF CANVASSERS OF DOLORES, QUEZON, VIVENCIO G. LIRIO respondents. G.R. No. L-54718 December 4, 1985 Facts: On January 25, 1980, petitioner filed a certificate of candidacy for Vice Mayor of Dolores for the January 30 elections in substitution for his companion Mendoza who withdrew candidacy without oath upon filing on January 4. Petitioner won in the election but the respondent Board disregarded all his votes and proclaimed respondent candidate as the winner on the presumption that petitioner’s candidacy was not duly approved by respondent. Petitioner filed a petition for the annulment of the proclamation but was dismissed by respondent Commission on the grounds that Mendoza’s unsworn withdrawal had no legal effect, and that assuming it was effective, petitioner’s candidacy was not valid since Mendoza did not withdraw after January 4. ISSUE: Whether or not petitioner should be disqualified on the ground of formal or technical defects. RULING: No. The fact that Mendoza’s withdrawal was not sworn is a technicality, which should not be used to frustrate the people’s will in favor of petitioner as the substitute candidate. Also, his withdrawal right on the very same day that he filed his candidacy should be considered as having been made substantially and in truth after the last day, even going by the literal reading of the provision by respondent Commission. The spirit of the law rather than its literal reading should have guided respondent Commission in resolving the issue of last-minute withdrawal and substitution of other persons as candidates. ===================Case No. 49: “May and Shall”==================== VIRGILIO CAPATI, plaintiff-appellant, vs. DR. JESUS P. OCAMPO, defendant-appellee. G.R. No. L-28742 April 30, 1982 Facts: Plaintiff Virgilio Capati, a resident of Pampanga, entered into a sub-contract with the defendant Dr. Jesus P. Ocampo, a resident of Naga City, for the construction of the vault walls, exterior walls, and columns of Feati Bank building in Iriga, Camarines Sur. The defendant further bound himself to complete the said to complete the said construction on or before June 5, 1967. Claiming that defendant finished the construction in question only on June 20, 1967, plaintiff filed in the Court of First Instance of Pampanga an action for recovery of consequential damages. Defendant filed a motion to dismiss the complaint on the ground that venue of action was improperly laid. The motion was premised on the stipulation printed at the back of the contract which reads: That all actions arising out, or relating to this contract may be instituted in the Court of First Instance of the City of Naga. Plaintiff filed an opposition to the motion, claiming that their agreement to hold the venue in the Court of First Instance of Naga City was merely optional to both contracting parties. In support thereof, plaintiff cited the use of the word "may " in relation with the institution of any action arising out of the contract. The lower court dismissed the complaint. Hence, the plaintiff appealed. Issue: Whether the use of “may” is restrictive or merely permissive. Decision of the Court: The rule on venue of personal actions cognizable by the courts of first instance is found in Section 2 (b), Rule 4 of the Rules of Court, which provides that such "actions may be commenced and tried where the defendant or any of the defendants resides or may be found, or where the plaintiff or any of the plaintiffs resides, at the election of the plaintiff." The said section is qualified by the following provisions of Section 3 of the same rule: By written agreement of the parties the venue of an action may be changed or transferred from one province to another. Defendant stands firm on his contention that because of the aforequoted covenant contained in par. 14 of the contract, he cannot be sued in any court except the Court of First Instance of Naga City. It is well settled that the word "may" is merely permissive and operates to confer discretion upon a party. Under ordinary circumstances, the term "may be" connotes possibility; it does not connote certainty. "May" is an auxiliary verb indicating liberty, opportunity, permission or possibility. The court held that the stipulation as to venue in the contract in question is simply permissive The order appealed from was set aside and the records be returned to the court of origin for further proceedings.
===================Case No. 50: “And and Or”===================== GMCR, INC.; SMART COMMUNICATIONS, INC.; INTERNATIONAL COMMUNICATIONS CORP.; ISLA COMMUNICATIONS CO., INC., Petitioners, vs. BELL TELECOMMUNICATION PHILIPPINES, INC.; THE NATIONAL TELECOMMUNICATIONS COMMISSION and HON. SIMEON L. KINTANAR in his official capacity as Commissioner of the National Telecommunications, Respondents. [G. R. No. 126496. April 30, 1997] FACTS: On October 19, 1993, Bell Telecommunication Philippines, Inc. (BellTel) filed with the National Telecommunications Co. (NTC) an Application for a Certificate of Public Convenience and Necessity to Procure, Install, Operate and Maintain Nationwide Integrated Telecommunications Services ad to charge rates therefor and with further request for the issuance of Provisional Authority. Since BellTel was, at the time, an unenfranchised applicant, it was excluded in the deliberations for service area assignments for local exchange carrier service, thus, on April and May 1994, only the petitioners were beneficiaries of the formal awards service area assignments . On March 1994, Republic Act No. 7692 was enacted granting BellTel a congressional franchise which gave private respondent the right, privilege and authority carry business of providing telecommunications system. On July 12, 1994, BellTel filed with the NTC a second application praying for the issuance of Certificate of Public Convenience and Necessity. It moved to withdraw its earlier application, which was ordered withdrawn on July 11, 1994. The NTC Commissioner Kintanar denied the request of BellTel for a Certificate of Public Convenience and Necessity for the installation of telecommunications equipment pursuant to its congressional franchise to operate. The denial was promulgated despite the approval of the CCAD of its feasibility and endorsement of Deputy Commissioner Dumlao and Perez. The petitioners claimed that pursuant to prevailing policy and corresponding procedure and practice in the NTC, the Commissioner has the sole authority to sign, validate and promulgate any and all orders, resolutions and decisions of the NTC. Anxious over the inaction of NTC, BellTel then filed an Urgent Ex-Parte Motion to Resolve Application and for the issuance of provisional authority. No action was again taken by the NTC, to which BellTel filed a second Urgent Ex-Parte Motion reiterating its earlier prayer. The petitions appealing the review and reversal of the decision of the Court of Appeals declaring the NTC to heretofore sit and act en banc, i.e., with the concurrence of at least two commissioners, for a valid dispensation of its judicial-functions. ISSUE: Whether or the NTC is a collegial body or under the direct and sole control of Commissioner Kintanar. RULING: Section 16 of Executive Order No. 546, the Commission is composed of a Commissioner and two deputy commissioners x x x not the commissioner, alone, as pontificated by Kintanar. The conjunctive word is not without any legal significance. It is not, by any chance, a suplusage in the law. It means in addition to (McCaull Webster Elevator Company versus Adams, 167 Northwestern Reporter, 330, page 332). The word and, whether it is used to connect words, phrases or full sentence[s], must be accepted as binding together and as relating to one another x x x. In interpreting a statute, every part thereof should be given effect on the theory that it was enacted as an integrated law and not as a combination of dissonant provisions. As the aphorism goes, that the thing may rather have effect than be destroyed x x x. If it was the intention of President Marcos to constitute merely a single entity, a one-man governmental body, instead of a commission or a three-man collegial body, he would not have constituted a commission and would not have specifically decreed that the Commission is composed of, not the commissioner alone, but of the commissioner and the two (2) deputy commissioners. Irrefragably, then, the NTC is a commission composed not only of Kintanar, but Perez and Dumlao as well, acting together in the performance of their adjudicatory or quasi-judicial functions, conformably with the Rules of Procedure and Practice promulgated by the BOC and applicable to the NTC. The Supreme Court dismissed the instant consolidated petitions for lack of merit.
