United States v. Diaz-Conde

Supreme Court of the Philippines subsidiary imprisonment in
accordance with the provisions of

the law. From that sentence each of
the defendants appealed to this
42 Phil. 766 court.
G. R. No. 18208, February The appellants now contend: (a)

That the contract upon which the
14, 1922 alleged usurious interest was
THE UNITED STATES,
collected was executed before Act
PLAINTIFF AND APPELLEE, VS. No. 2655 was adopted; (b) that at the
VICENTE DIAZ CONDE AND time said contract was made
APOLINARIA R. DE CONDE, (December 30, 1915), there was no
DEFENDANTS AND usury law in force in the Philippine
APPELLANTS. Islands; (c) that said Act No. 2655
did not become effective until the
DECISION 1st day of May, 1916, or four
months and a half after the contract
JOHNSON, J.:
in question was executed; (d) that
It appears from the record that on said law could have no retroactive
the 6th day of May, 1921, a effect or operation, and (e) that said
complaint was presented in the law impairs the obligation of a
Court of First Instance of the city of contract, and that for all of said
Manila, charging the defendants with reasons the judgment imposed by
a violation of the Usury Law (Act the lower court should be revoked;
No. 2655). Upon said complaint they that the complaint should be
were each arrested, arraigned, and dismissed, and that they should each
pleaded not guilty. The cause was be discharged from the custody of
finally brought on for trial on the 1st the law.
day of September, 1921. At the close
The essential facts constituting the
of the trial, and after a consideration
basis of the criminal action are not in
of the evidence adduced, the
dispute, and may be stated as
Honorable M. V. del Rosario, judge,
follows: (1) That on the 30th day of
found that the defendants were
December, 1915, the alleged
guilty of the crime charged in the
offended persons Bartolome
complaint and sentenced each of
Oliveros and Engracia Lianco
them to pay a fine of P120 and, in
executed and delivered to the
case of insolvency, to suffer
defendants a contract (Exhibit B) In other words, the obligation to pay
evidencing the fact that the former interest on money due under a
had borrowed from the latter the contract, be it express or implied, is a
sum of P300, and (2) that, by virtue part of the obligation of the contract.
of the terms of said contract, the Laws adopted after the execution of
said Bartolome Oliveros and a contract, changing or altering the
Engracia Lianco obligated rate of interest, cannot be made to
themselves to pay to the defendants apply to such contract without
interest at the rate of five per cent violating the provisions of the
(5%) per month, payable within the constitution which prohibit the
first ten days of each and every adoption of a law "impairing the
month, the first payment to be made obligation of contract." (8 Cyc, 996;
on the 10th day of January, 1916. 12 Corpus Juris, 1058-1059.)
There were other terms in the
contract which, however, are not The obligation of the contract is the
important for the decision in the law which binds the parties to
present case. perform their agreement if it is not
contrary to the law of the land,
The lower court, in the course of its morals or public order. That law
opinion, stated that at the time of must govern and control the
the execution and delivery of said contract in every aspect in which it is
contract (Exhibit B), there was no intended to bear upon it, whether it
law in force in the Philippine Islands affect its validity, construction, or
punishing usury; but, inasmuch as discharge. Any law which enlarges,
the defendants had collected a abridges, or in any manner changes
usurious rate of interest after the the intention of the parties,
adoption of the Usury Law in the necessarily impairs the contract itself.
Philippine Islands (Act No. 2655), If a law impairs the obligation of a
they were guilty of a violation of that contract, it is prohibited by the Jones
law and should be punished in Law, and is null and void. The laws
accordance with its provisions. in force in the Philippine Islands
prior to any legislation by the
The law, we think, is well established American sovereignty, prohibited the
that when a contract contains an Legislature from giving to any penal
obligation to pay interest upon the law a retroactive effect unless such
principal, the interest thereby law was favorable to the person
becomes part of the principal and is accused. (Articles 21 and 22, Penal
included within the promise to pay. Code.)
A law imposing a new penalty, or a act done before its adoption a crime.
new liability or disability, or giving a A law may be given a retroactive
new right of action, must not be effect in civil action, providing it is
construed as having a retroactive curative in character, but ex post
effect. It is an elementary rule of facto laws are absolutely prohibited
contract that the laws in force at the unless its retroactive effect is
time the contract was made must favorable to the defendant.
govern its interpretation and
application. Laws must be construed For the reason, therefore, that the
prospectively and not acts complained of in the present
retrospectively. If a contract is legal case were legal at the time of their
at its inception, it cannot be occurrence, they cannot be made
rendered illegal by any subsequent criminal by any subsequent or ex
legislation. If that were permitted post facto legislation. What the
then the obligations of a contract courts may say, considering the
might be impaired, which is provisions of article 1255 of the Civil
prohibited by the organic law of the Code, when a civil action is brought
Philippine Islands. ( U. S. vs. upon said contract, cannot now be
Constantino Tan Quingco Chua, 39 determined, A contract may be
Phil., 552; Aguilar vs. Rubiato and annulled by the courts when it is
Gonzales Villa, 40 Phil., 570.) shown that it is against morals or
public order.
Ex post facto laws, unless they are
favorable to the defendant, are For all of the foregoing reasons, we
prohibited in this jurisdiction. Every are of the opinion, and so decide,
law that makes an action, done that the acts complained of by the
before the passage of the law, and defendants did not constitute a crime
which was innocent when done, at the time they were committed,
criminal, and punishes such action, is and therefore the sentence of the
an ex post facto law. In the present lower court should be, and is hereby,
case Act No. 2655 made an act revoked; and it is hereby ordered and
which had been done before the law decreed that the complaint be
was adopted, a criminal act, and to dismissed, and that the defendants
make said Act applicable to the act be discharged from the custody of
complained of would be to give it an the law, with costs de oficio. So
ex post facto operation. The ordered.
Legislature is prohibited from
adopting a law which will make an
Araullo, C. J., Street, Malcolm,
Avanceña, Ostrand, Johns, and
Romualdez, JJ., concur.
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Supreme Court of the Philippines subsidiary imprisonment in

accordance with the provisions of

G. R. No. 18208, February The appellants now contend: (a)

Copyright 2016 - Batas.org

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