STATCON PART V

A. Law construed as a whole in relation to other laws (Dobie)

Caudal v. CA
GR No. 83414 ; 31 July 1989
Ponente: Fernan, C.J.

Facts:
Private respondents Dionisio Cu (with his wife and five children) had rented an apartment in D. Tuason
(QC) then transferred to Silencio St. (also in QC). In February 1984, respondent bought a lot with a six-
door apartment building in E. Garcia (QC) for their permanent home from a Juliet Esguerra.

July 2, 1984 - A notice was given to the occupant/petitioner Tony Caudal that he would have to vacate the
said apartment by October. Caudal refused to do so claiming that he had a continuous, monthly, verbal
agreement (since 1967) with Esguerra for the rent.

After complaining to the baranggay, respondents filed an ejectment case against Caudal at the MTC
which ruled in favor of the petitioners. The RTC reversed the decision and the CA subsequently affirmed
such decision.

Caudal claims that Cu's intention of using a portion of the building as a maid's room does not fall under
the grounds for judicial ejectment under Sec. 5 of BP 877:

Grounds for Judicial Ejectment:

Sec. 5 (c) Legitimate need of owner/lessor to repossess his property for his own use or for use of any
immediate member of his family as a residential unit, such owner or immediate member not being the
owner of any other available residential unit within the same city or municipality; Provided however, that
the lessor has given the lessee formal notice three months in advance of the lessor's intention to repossess
the property; and provided, finally, that the owner/lessor is prohibited from leasing the residential unit or
allowing its use by a third party for at least one year.

Issue:
W/N the use of a portion of the building as a maid's room does not fall under the provision above? NO.

Ratio:
Legislative intent must be ascertained from a consideration of the whole statute. Clauses and phrases of
the law should not be taken as detached/isolated expressions, but the whole must be considered in fixing
the meaning of any of its parts. The Rental Law Batas Pambansa 877 defines residential unit as:

Sec. 2 (b)...refers to an apartment, house and/or land on which another's dwelling is located used for
residential purposes and shall include not only buildings, parts or units thereof used solely as dwelling
places, except ... but also those used for home industries, retail stores or other business purposes if the
owner thereof and his family actually live therein and use it principally for dwelling purposes: Provided,
that in the case of a retail store, home industry or business, the initial capitalization thereof shall not
exceed five thousand pesos (P5,000.00) and Provided, further, that in the operation of the store, home
industry or business, the owner thereof shall not require the services of any person other than the
members of his household.

The P5,000 limit aims to emphasize the property to be used as an abode than a place of business. The fact
that some of the doors would be merged for the 2 units to become 1 as the conjugal home of one of the
children and the rest of the units as the conjugal dwelling of Dionisio and spouse. The maid's quarters are
auxiliary to the residential unit. Although having different rooms, the fact that the partitions were
removed to make all the parts of the property belong under 1 roof, then it will be considered as one
dwelling house. The main reason for buying the property would still be primarily for dwelling purposes
(as allowed under BP 877).

The last paragraph of Sec. 5 of BP 877:

(N)o lessor or his successor-in-interest shall be entitled to eject the lessee upon the ground that the leased
premises has been sold or mortgaged to a third person regardless of whether the lease or mortgage is
registered or not.

This provision means that the sale of the property cannot be the sole reason for the ejectment. In this
case, the other reasons (which are more substantive) were already proven and discussed (paragraph B of
Sec.5).

The fact that Esguerra had not billed Caudal for the month of November and that the 3 month notice was
followed by Cu weakens the petitioner's cause. To give preferential right to a tenant over and above a
new owner's need for the premises for his use and that of his family is arbitrary and unreasonable.

Ruling:
CA decision AFFIRMED.

B. Title of the Law (Dobie)

City of Baguio v. Marcos
GR No. L-26100 ; 28 February 1969
Ponente: Sanchez, J.

Facts:
Apr.12, 1912 - Director of Lands in the CFI of Baguio instituted reopening of cadastral proceedings
(regarding properties - its geographical boundaries/values for the use of taxation).

Nov. 13, 1922 - CFI ruled that the Baguio Townsite was a part of the declared public lands.

July 25, 1961 - Private respondent Belong Lutes petitioned the cadastral court to reopen the case claiming
that Baguio Townsite should be registered to his name due to his predecessors' historical ownership of the
land (who were illiterate Igorots who weren't able to file their claims). Private petitioners Francisco
Joaquin Sr., et. al. (tree farm lessees of the land in question) questioned and opposed such reopening
claiming that the Lutes petition was filed outside the 40-year period under RA 931, that the petition was
not published, and that as lessees, they have standing to appear in the reopening proceedings.

Jan. 6, 1964 - The City of Baguio filed a motion to dismiss the petition to reopen claiming that they were
not bound by the earlier decision of the CFI.

The lower courts all ruled in favor of Lutes. The CA held that although the petitioners were not bound by
the declaratory judgment, they had no right to oppose the cadastral case.

Issue:
W/N the reopening petition was filed outside the 40-year period as stated in RA 931 which was enacted in
June 20, 1953? NO.

Ratio:
(singit ko muna 'tong side-decision) - The petitioners have legal standing as lessees to the land. If they
prove that they are legitimate lessees, then their lease will continue (which makes it out of reach from RA
931).

(legit decision) - There seems to be an inconsistency between the title and sec. 1 of RA 931. The spirit of
the law prevails over the letter thereof. In such cases, the title of the law may be resorted to in the
ascertainment of congressional will. The title carries the very substance of the law itself.

AN ACT TO AUTHORIZE THE FILING IN THE PROPER COURT, UNDER CERTAIN

CONDITIONS, OF CERTAIN CLAIMS OF TITLE TO PARCELS OF LAND THAT HAVE BEEN
DECLARED PUBLIC LAND, BY VIRTUE OF JUDICIAL DECISIONS RENDERED WITHIN THE
FORTY YEARS NEXT PRECEDING THE APPROVAL OF THIS ACT.

Section 1 thereof provides —

SECTION 1. All persons claiming title to parcels of land that have been the object of cadastral
proceedings, who at the time of the survey were in actual possession of the same, but for some justifiable
reason had been unable to file their claim in the proper court during the time limit established by law, in
case such parcels of land, on account of their failure to file such claims, have been, or are about to be
declared land of the public domain by virtue of judicial proceedings instituted within the forty years next
preceding the approval of this Act, are hereby granted the right within five years

[conflict arises from the title - "JUDICIAL DECISIONS RENDERED" vs. sec. 1 - "judicial proceedings
instituted" ; judicial decision was rendered on Nov. 13, 1922 while judicial proceeding was instituted on
Apr. 12, 1912]

Ruling:
Petition for Certiorari GRANTED. Petitioners' oppositions and claims to be discussed in court.
(Technically, pasok yung cadastral case ni Lutes
a 40-year period, pero allowed pa rin yung mga petitioners to assail it as lessees)
 C. Preamble (Jake)
People vs. Purisima
Petitioners: People of the Philippines
Respondents: Porficio Candelosas y Duran
Ponente: Munoz Palma, J.

FACTS
1. Duran has been accused of violating paragraph 3 of Presidential Decree 9 of Proclamation 1081
when he was caught in his possession and under his custody and control one carving knife carried outside
of his residence, while said weapon not being used as a tool or implement necessary to earn his livelihood
nor being used in connection therewith.
2. 26 petitions for review were filed against him. Trial Court Judges including Purisima dismissed
the case since Duran did not fulfill the second element of the offense charged, that is in 1) carrying
outside one's residence any bladed, blunt, or pointed weapon, etc. not used as a necessary tool and
implement for a livelihood, 2) in furtherance or on the occasion of, connected with or related to
subversion, insurrection, or rebellion, organized lawlessness or public disorder.
3. People of the Philippines raise issue to the SC.

ISSUES
W/N Duran is guilty of the offense in violation of Paragraph 3 of Presidential Decree 9? NO.

HELD
1. Ordinance 3820 of the City of Manila as amended by Ordinance 3928 that "penalizes a fine not
more than 200 pesos or imprisonment of not more than 1 month anyone who shall carry a concealed in his
person any manner that would disguise its deadly character any kind of firearm, bowie knife, or other
deadly weapons", was claimed to be repealed by the PD 9. The court does not agree with this. PD 9 does
not contain any repealing clause or provision, and repeal by implication is not favored anyway.
2. The second element of the offense is missing in the case. Without the second element, the act
falls within the purview of the city ordinance previously mentioned or some statute which circumstances
so warrant.
3. There is ambiguity in the presidential decree when PD 9 covers all situations a person carries
outside his residence any of the weapons mentioned and described in the decree irrespective of
motivation, intent, or purpose.
4. The Context of PD 9 which identifies the intent of the law:
a. state of martial law.
b. desired result of Proclamation 1081 as mentioned in PD 9.
c. the fact that subversion, rebellion, insurrection, lawless violence, criminality, chaos, and public
disorder mentioned in Proc 1081 are committed and abetted by the use of firearms and explosives and
other deadly weapons.
5. It follows that it is only that act of carrying a blunt or bladed weapon with a motivation connected
with or related to the afore-quoted desired result of Proc 1081 that is within the intent of PD 9, and
nothing else. Duran cannot be liable for PD 9.
6. It is a salutary principle in statutory construction that there exists a valid presumption that
undesirable consequences were never intended by a legislative measure, and that a construction of which
that statute is fairly susceptible is favored, which will avoid all objectionable, mischievous, indefensible,
wrongful, evil, and injurious consequences.
7. It is presumed that when PD 9 was promulgated by the President of the Republic there was no
intent to work a hardship or oppressive result, a possible abuse of authority or an act of oppression,
arming one person with a weapon to impose hardship on another, and so on.

DECISION
Petitions DENIED.

D. Punctuation Marks (Gabbi)

Florentino and Zandueta v PNB
G.R. No. L-8782
April 28, 1956
Ponente: Jugo, J.
Facts

1. Petitioners filed with the CFI of La Union a petition for mandamus to compel PNB to accept
Florentino’s backpay certificate (P22,896.33) issued by the Republic of the Philippines as payment for his
debt of P6,800, which is provided in Sec 2 of Republic Act 897.

2. Sec 2 of republic act:

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 or 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 interest: 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 or 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;

Issues
1. W/N the clause “who may be willing to accept the same for such settlement” refers to only the
last antecedent?
Disposition
Petition GRANTED. CFI decision REVERSED.
Rationale
1. YES. PNB contend that the last clause refers to all antecedents. PNB’s contention fails in (1)
grammatically; had there been no comma after, “or to any citizen of the Philippines,” grammatically, the
last clause would also refer to the antecedent before the last. However, since there is a comma,
grammatically the clause refers only to the last. (2) Unconstitutionality; even if we were to disregard the
grammar, if all antecedents were to be referred by the clause, would render Sec 2 unconstitutional, since it
would impair the obligation of contracts by compelling private creditors to accept a promissory note
payable within 10 years, and having an interest rate much lower than the legal one. (3) Congressional
Record; the congressional records state that the purpose for the amendment (RA 897 amended RA 304)
to clarify that the bill permits the use of backpay certificates as payment for indebtedness in favor of the
government. (4) Jurisprudence; in the case of Diokono v Rehabilitation Finance Corporatio, Diokono
incurred a debt after one year passed the approval of RA 304 (amended by RA 897) which would mean
that RFC could have the discretion to accept the backpay cert. as payment.

E. Headnotes or Epigraphs (Ricki Pogi)

People vs. Yabut Sept. 27, 1933

Appellee: People of the Philippines
Appellant: Antonio Yabut

FACTS
1. Accused Antonio Yabut, then serving sentence in the Bilibid Prison, beat and use personal
violence upon Sabas Aseo. He hit Aseo with a wooden club from behind fracturing the skull, and
inflicting upon Aseo several physical injuries on different parts of his body which caused his
death.
2. At the time of the commission, Yabut is a recidivist having previously been convicted twice of
the crime of homicide and once of serious physical injuries, by virtue of final sentence rendered
by competent tribunals.
3. The CFI found Yabut guilty of Murder qualified by treachery. Yabut appeals to the SC.

ISSUES
1. W/N the application of Article 160 to the accused was valid? YES.
2. W/N the crime was qualified with treachery? NO.

HELD
1. The English translation of Article 160 (originally Spanish text) provides that, "Commission of
another crime during service of penalty imposed for another previous offense -- Penalty. --
Beside the provisions of rule 5 of article 62, any person who shall commit a felony after having
been convicted by final judgement, before beginning to serve such sentence, or while serving the
same, shall be punished by the maximum period of the penalty prescribed by law for the new
felony."
2. The accused makes an assertion that the word "another" in the headnote or epigraph of article
160 means that the previous offense should be a different offense from the current offense, for
 article 160 to apply. Since he is convicted for murder, he argues that murder is different from his
prior convictions of homicide and once of serious physical injuries. Therefore article 160 should
not apply to him in the instant case.
3. It is familiar law that when the text itself of a statute or a treaty is clear and unambiguous, there is
neither necessity nor propriety in resorting to the preamble or headings or epigraphs of a section
for interpretation of a text, especially where such epigraphs or headings of sections are mere
catchwords or reference aids indicating the general nature of the text that follows.
4. A mere glance at the titles to the articles of the RPC will reveal that they were not intended by the
Legislature to be used anything more than catchwords conveniently suggesting in a general way
the subject matter of each article. Being nothing more than a convenient index to the contents of
the articles of the Code, they cannot in any event have the effect of modifying or limiting the
unambiguous words of the text. Secondary aids may be consulted to remove, not to create doubt.
5. The accused's conviction is not qualified with treachery since there is reasonable doubt.
Therefore, he is only convicted for homicide. Taking into account the circumstances, Article 160
should also apply to him.

DECISION
Defendant guilty of Homicide and, applying article 249 of the RPC in connection with article 160
of the same, the defendant is sentenced to the maximum degree of reclusion temporal, and to indemnify
the heirs of the deceased in the sum of P1000.

F. Conflicting Provisions (Anton)

Manila Railroad Co. vs Collector of Customs
No. 30264 March 12, 1929 Justice Malcolm
FACTS:
Par. 141 of the Tariff Law of 1929 states: “Manufactures of wool, not otherwise provided, for,
40% ad valorem. On the other hand, Par. 197 states “Vehicles for use on railways and tramways, and
detached parts thereof, ten percent ad valorem”.
The Collector of Customs taxed Manila Railroad Company for their dust shields under Par. 141.
This is because he argued that dust shields are manufactured mainly of wool. Dust shields are used by
Manila Railroad Company in their railroad cars. On the other hand, Manila Railroad Company states that
dust shields fall under Par. 197 (“detached parts thereof”) because they are detachable parts of railroad
cars. Hence, they sought the court’s intervention in ascertaining which paragraphs govern dust shields.
` The lower judge, Judge Simplicio, sided with Manila Railroad Co. that dust shields fall under Par.
197, being detachable parts. Hence, the Collector of Customs filed this appeal.
ISSUES:
Whether Dust Shields are taxable under Par. 141 or Par. 197 (Par. 197- they are more of
detachable parts of railroad cars)
RULING:
- Both the arguments of Manila Railroad and the Collector of Customs have merit. Dust shields are
detachable parts made of wool. Judge Simplicio is also correct in ruling that tax statutes are to be
construed against the Government and in favor of the citizens. There are however, two ways out
of this dilemma.
 - First: If one takes into account the purpose of the dust shields, one can easily glean that it is a
detached part of railway vehicles.
- Second: Par 141 is GENERAL while Par 197 is SPECIAL/PARTICULAR. In this case, the
particular statute must prevail over the general statute.

G. Meaning of the Word Qualified by Purpose of the Statute (Ricki Pogi)

David vs. Court of Appeals May 6, 1988

Petitioners: Wilfredo David
Respondents: Court of Appeals, and 9 respondents

FACTS
1. The 9 respondents in this case are share tenants of Patricio David in his 36-hectare land in
barangays San Pablo and San Agustin in Magalang, Pampanga. Each tenant had a landholding of
4-5 ha. devoted entirely to sugarcane production which were ultimately processed into sugar by
the Pampanga Sugar Development Company (PASUDECO).
2. The respondents provide manual labor for Patricio, while Patricio exercises general supervision
and control of the farm, while attending to the needs of the tenants. Effective in 1979-80
agricultural year, Patricio David leased his sugarland to his son, Wilfredo David.
3. The private respondents notified Wilfredo David of their intention to elect the leasehold tenancy
system starting from agricultural year 1980-81. David objected to this because he had already
planned for the system of the year 1980-81 apart from his belief that his tenants were financially
incapable for the new system. He therefore halted the cutting of the canes which had started
already in November 1979.
4. The respondents sought the help of the Bureau of Agrarian Legal Assistance and filed a
complaint in the Court of Agrarian Relations in Angeles City. They ask the court to compel
Wilfredo David to shift to the leasehold tenancy system.
5. David asserts that respondents were not entitled to the leasehold tenancy system because Section
4 of RA 3844 as amended was not applicable to sugarlands inasmuch as the production of sugar
was covered by marketing allotments.
6. The Court of Agrarian Relations ruled in favor of the private respondents, ordering the change of
relationship from "share tenancy" to "leasehold tenancy system".
7. David appealed to the CA. The CA affirmed the lower agrarian court. Hence, the instant petition
for review.
ISSUES
1. W/N the tenants in the plantations for sugarcane production may convert their relationship with
the landowner from "sharing leasehold system" to "leasehold tenancy system"? YES.

HELD
1. The CA stated that the only basis of David's appeal is the second provision in Section 4 of RA
3844, that "xxx lands devoted to crops covered by marketing allotments shall be made the
subject of a separate proclamation of the President xxx." David asserts that sugarcane
production is covered by marketing allotments stated in the provision. The respondents on the
other hand contend that it is not. The CA held that, "Where the language of a statute is fairly
 susceptible to two or more constructions, that should be adopted which will most tend to give
effect the manifest intent of the lawmaker and promote the object for which the statute was
enacted and a construction should be rejected which would tend to render abortive other
provisions of the statute and to defeat the object which the legislator sought to attain by the
enactment." In the case at bar, there is no showing from the crops harvested from the appellant's
landholding are covered by marketing allotments. The Philippines no longer depends on the
marketing allotment or quota which our sugar industry was committed to fill for the American
market. Therefore, since not covered by marketing allotments, a separate proclamation of the
President is not needed for the change of relationship between tenants and landowners.
2. The intent of the lawmakers in automatic change of systems of tenancy contract found in RA
6389 is to depart from oppressive and outdated systems. The "automatic change" of tenancy
system (which respondents hinge their arguments on), definitely applies to them. No need for
Presidential proclamation since the sugar industry is NOT covered by marketing allotments in RA
3844.

DECISION - Petition DENIED. CA is AFFIRMED.

H. Words Construed in their Ordinary Sense (Gabbi)

I. General Words Construed Generally (Anton)

Gatchalian v COMELEC
Nos. L-32560-61 October 22, 1970 Justice Makasiar
FACTS:
Esmeraldo Gatchalian alleges that he is a candidate for delegate to the Constitutional Convention
for the first district of Rizal. While his CoC is being processed, the COMELEC promulgated COMELEC
Resolution No. RR-707, holding that “donations of billboards to the Commission by foreigners or
companies or corporations owned and controlled partially or wholly by foreigners are not covered by the
provision on Sec. 56 of the Revised Election Code”. It also passed Resolution No. RR-731, which states
that the ban in Sec. 46 of the Revised Election Code does not cover the projected campaign for funds and
other contributions by the Advertising Council of hte Philippines and others similarly situated.
Petitioner filed two cases, assailing that the COMELEC Resolutions violated Sec. 56 of the
Revised Election Code. The COMELEC denied both, saying that the contributions of foreigners to the
COMELEC Billboard Committee are not made in support of any candidate, and hence could not
influence the elections. Aggrieved, petitioner filed for a WPI to the SC to stop COMELEC from
enforcing the said resolutions. The COMELEC, however, voluntarily refrained from enforcing said
resolutions. Still, the SC took cognizance of the case because of the questions of law involved.
PERTINENT LAW: SEC. 56 of the Revised Election Code
“No foreigner shall aid any candidate, directly or indirectly, or to take part in or influence in
any manner any elections”
To sum up, Sec. 56 bars foreigners from: (1) aiding any candidate, directly or indirectly, in any
election, (2) taking part in any election, and (3) influencing in any manner any election.
ISSUES:
- W/N “candidate” includes candidates for the ConCon (YES)
- W/N “foreigner” includes not only natural but also juridical persons (YES)
 - W/N the donations of billboards count as “influencing” the elections (YES)
RULING:
- On “Candidate”: It includes candidates for the ConCon. The Revised Election Code is meant to
apply to all elections, and subsequently to all candidates. This is a point already settled in
previous jurisprudence.
- On “Foreigner”: It would be illogical to limit foreigner to just natural persons and not juridical
persons (i.e. companies). If the intent of Sec. 56 is to prohibit foreigners from participating or
influencing the elections, then it would be illogical to limit it to just natural foreigners. This is
because foreign juridical persons have naturally more money and resources which it can use to
influence the elections than foreign natural persons. As such, there is greater need to prevent
juridical persons from unduly influencing the elections.
- On billboards as election “influence”: If one looks at Sec. 56, it prohibits three acts: “aid”, “take
part”, and “influence”. Aid means to support or to help, take part means to participate, and
influence means “to have an effect on the nature and behavior of”. It will be extremely myopic to
think that billboards cannot influence the elections in any way. Billboards can substantially
influence a voter’s mindset, and also a candidate’s chance of winning. Furthermore, if a candidate
won with foreign support, then this can affect the way he acts towards foreigners in the future,
which may have adverse effects in the country. As such, it will completely defeat the purpose of
the prohibition in Sec. 56 if financing billboards will not count as “influencing” the elections.
DECISION:
The contested COMELEC resolutions are declared VOID.

J. Use of Generic Words Include Things that Arise after Enactment of the Law (Trisha)
Geotina v Court of Tax Appeals
G.R. No. L-33600
30 August 1971
Petitioner: Rolando Geotina as Commissioner of Customs
Respondents: CTA and Unitrade Inc.
Ponente: Teehankee, J.

Facts:
Tax court restated the facts in its decision referring to herein respondent importer as petitioner before it
and to herein petitioner commissioner as respondent before it. Petitioner is a domestic corporation duly
organized and existing under and by virtue of the laws of the Philippines. On 22 December 1970, the
vessel M/V ‘Mindanao Sea’ arrived at the port of Manila carrying 37,042 cartons fresh apples consigned
to herein petitioner. After payment of taxes and duties, the necessary transfer permits were issued by the
Collector of Customs of Manila. While this importation was being unloaded from the carrying vessel and
transported to the designated cold storage house, Collector of Customs issued warrants of seizure and
detention, ordering the seizure of a portion, of the good already unloaded and their detention for allegedly
having been imported in violation of Central Bank Circulars Nos. 289, 294, and 295 in relation to Section
2530 (f) of the Tariff and Customs Code ‘pending termination of the seizure proceedings thereof and/or
until further orders.’ Before the entire shipment could be unloaded, the Collector of Customs apparently
changed his mind and ordered that the good already unloaded be returned to the vessel.
On 23 December 1970, petitioner requested the discharge of said articles from the carrying vessel and
their delivery to it under bond. This was denied by the Collector of Customs: “the matter is under
advisement by the proper government authorities and this Office regrets that for the moment, it cannot
grant its request”. On appeal from this decision, the Commissioner refused to render a decision until the
Collector shall have rendered a definite ruling on the matter.

On 22 January 1971, petitioner again requested the Collector of Customs to have the goods discharged
from the vessel and their delivery to it under bond. The Collector denied the request: “the importation of
said goods is prohibited under Circular Nos. 289, 294, and 295 of the Central Bank and are therefore
articles of prohibited importation under Section 102 (k) of the Tariff and Customs Code”. Under Sec.
1207 of the Tariff and Customs Code: where the importation is prohibited, or subject to the conditions
prescribed by law, the Collector is duty bound to exercise two options — either to prevent the importation
of the cargo or require compliance with all the requirements (the latter is not feasible under the
circumstances given that the goods are prohibited).

Respondent Commissioner of Customs, on appeal from said decision of the Collector of Customs,
sustained the decision of the latter in an order dated 29 January 1971. Hence, this appeal. Upon
respondent’s filing of its appeal with the lower court from the customs commissioner’s decision affirming
that of the Manila Customs Collector denying said respondent’s request for the discharge of the shipment
of said cartons of apples, it renewed its move, through motion for a preliminary injunction for immediate
discharge from the carrying vessel and release under bond of said shipment. Tax court denied the motion.
Respondent’s motion for reconsideration of the denial order was denied anew by the tax court. Another
urgent motion of respondent alleging malfunctioning of the reefer machinery of the carrying vessel, tax
court allowed the immediate discharge of the fruits and their deposit in a customs bonded warehouse
under conditions as to prevent or arrest spoilage or deterioration pending final determination of the case.
Fruits were thus deposited since 19 March 1971 at the refrigerated storage compartments of the Ice &
Cold Storage Corporation at Manila.

Tax court rendered decision stating, “while said goods are not articles of prohibited importation, they may
be held liable for forfeiture for failure of petitioner to secure a release certificate from the Central Bank,
which liability may be determined in an appropriate seizure proceeding to be conducted by the Collector
of Customs, pursuant to Sec. 2301 of the Tariff and Customs Code”. Respondent is hereby ordered to
release petitioner’s 37,042 cartons of fresh apples in questions after petitioner shall have filed a sufficient
bond of guarantee payment of the appraised value.

In respondent’s last urgent motion of 20 July 1971, it prayed for resolution of the case at bar for the
reason that the fresh fruits are already in grave danger of totally deteriorating — some are already spoiled.

Issue:
Whether or not the fresh apples in question are “articles of prohibited importation”?

Held: YES
The tax court's first stated ground that the importation of fresh apples was "not absolutely prohibited"
under the Central Bank circulars and that therefore the apples could not be deemed "articles of prohibited
importation" as envisaged by section 102 of the tariff and customs code has been long rejected by the
settled doctrine and jurisprudence of the Court. The contention that to be deemed articles of prohibited
importation, the questioned articles must partake of the same nature as those specifically declared
prohibited in said section 102 (formerly section 3 of the Philippine Tariff Act of 1909) such as explosives,
etc. was discarded by the Court in the 1959 case of Tong Tek vs. Commissioner of Customs:

”Petitioners alleged that the term 'merchandise of prohibited exportation' used in Section 1363-(f)
of the Revised Administrative Code (now Section 2530-f of the tariff and customs code) has its
own fixed end definite meaning; that it refers exclusively to those articles specifically declared
prohibited by Section 3 of the Philippine Tariff Act of 1909, such as firearms and explosives,
obscene and subversive articles, gambling outfits, falsely marked gold and silver articles,
adulterated foods, lottery tickets, opium and opium pipes, and as gold bars do not fall under any
of the enumeration, they conclude that the aforementioned codal provision can not be invoked in
ordering the forfeiture of the articles in question. We entertain a different view.

"It must be remembered that the Revised Administrative Code is a general legislation. As such, it
must have been intended to meet not only the peculiar conditions obtaining at the time of its
enactment but also designed to comprehend those that may normally arise after its approval. To
our mind, the term 'merchandise of prohibited exportation' used in the code is broad enough to
embrace not only those already declared prohibited at the time of its adoption but also goods,
commodities or articles that may be the subject of activities undertaken in violation of subsequent
laws. Considering that the Central Bank circulars, issued for the implementation of the law
authorizing their issuance although by themselves are not statutes, have the force and effect of
law (People vs. Que Po Lay, 94 Phil. 640; 50 Off. Gaz., No. 10, p. 4850), the carrying out of
transactions or undertakings without complying with the requirements of Circular Nos. 20, 21
and 42 makes these undertakings illegal. And as a natural consequence thereof, the articles
involved in such unauthorized ventures become prohibited and, therefore, subject to forfeiture
under Section 1363-(f) of the Revised Administrative Code."

ACCORDINGLY, judgment is hereby rendered annulling and setting aside the decision, dated April 23,
1971 and the resolution dated May 23, 1971 of the court of tax appeals. The decision of petitioner
commissioner of customs appealed from by private respondent is instead affirmed and the petition of said
respondent in the lower court is dismissed, with costs in both instances against said respondent.