Kilos Bay An

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KILOSBAYAN, INC., et. al. vs. GUINGONA, et. al.

G. R. No. 113375, May 5, 1994

FACTS: This is a special civil action for prohibition and injunction, with a prayer for a temporary restraining order

and preliminary injunction which seeks to prohibit and restrain the implementation of the Contract of Lease

executed by the PCSO and the Philippine Gaming Management Corporation in connection with the on-line lottery

system, also know as lotto.

Petitioners strongly opposed the setting up of the on-line lottery system on the basis of serious moral and ethical

considerations. It submitted that said contract of lease violated Section 1 of R. A. No. 1169, as amended by B. P.

Blg. 42.

Respondents contended, among others, that, the contract does not violate the Foreign Investment Act of 1991; that

the issues of wisdom, morality and propriety of acts of the executive department are beyond the ambit of judicial

reviews; and that the petitioners have no standing to maintain the instant suit.

ISSUES:

1. Whether or not petitioners have the legal standing to file the instant petition.

2. Whether or not the contract of lease is legal and valid.

RULING: As to the preliminary issue, the Court resolved to set aside the procedural technicality in view of the

importance of the issues raised. The Court adopted the liberal policy on locus standi to allow the ordinary taxpayers,

members of Congress, and even association of planters, and non-profit civic organizations to initiate and prosecute

actions to question the validity or constitutionality of laws, acts, decisions, or rulings of various government

agencies or instrumentalities.

As to the substantive issue, the Court agrees with the petitioners whether the contract in question is one of lease or

whether the PGMC is merely an independent contractor should not be decided on the basis of the title or designation

of the contract but by the intent of the parties, which may be gathered from the provisions of the contract

itself. Animus homini est anima scripti . The intention of the party is the soul of the instrument.

Therefore the instant petition is granted and the challenged Contract of Lease is hereby declared contrary to law and

invalid.

Demetria et al as taxpayers and members of NA/BP sought to prohibit Alba, then Minister of the Budget,from disbursing funds pursuant to PD 1177 or the Budget Reform Decree of 77. Demetria assailed theconstitutionality of Sec 44 of the said PD. This Section provides that The President shall have the authorityto transfer any fund, appropriated for the different departments, bureaus, offices and agencies of theExecutive Department, which are included in the General Appropriations Act, to any program, project or activity of any department, bureau, or office included in the General Appropriations Act or approved after itsenactment." Demetria averred that this is unconstitutional for it violates the 1973 Constitution.

ISSUE: Whether or not Par 1, Sec 44, of PD 1177 is constitutional.

HELD: Sec. 16[5]. No law shall be passed authorizing any transfer of appropriations, however, thePresident, the Prime Minister, the Speaker, the Chief Justice of the Supreme Court, and the heads of constitutional commissions may by law be authorized to augment any item in the general appropriations law


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for their respective offices from savings in other items of their respective appropriations.Par 1 of Sec 44 of PD1177 unduly overextends the privilege granted under said Section 16[5]. It empowersthe President to indiscriminately transfer funds from one department, bureau, office or agency of theExecutive Department to any program, project or activity of any department, bureau or office included in theGeneral Appropriations Act or approved after its enactment, without regard as to whether or not the funds to

be transferred are actually savings in the item from which the same are to be taken, or whether or not thetransfer is for the purpose of augmenting the item to which said transfer is to be made. It does not onlycompletely disregard the standards set in the fundamental law, thereby amounting to an undue delegation of legislative powers, but likewise goes beyond the tenor thereof. Indeed, such constitutional infirmities render the provision in question null and void. HOWEVER, transfers of savings within one department from oneitem to another in the GA Act may be allowed by law in the interest of expediency and efficiency. There isno transfer from 1 dept to another here.

Avelino v. Cuenco

FACTS: The petitioners, Senator Jose Avelino, in a q uo warranto proceeding, asked the court to declare him the

rightful Senate President and oust the respondent, Mariano Cuenco. In a session of the Senate, Tanadas request to

deliver a speech in order to formulate charges against then Senate President Avelino was approved. With theleadership of the Senate President followed by his supporters, they deliberately tried to delay and prevent Tanada

from delivering his speech. The SP with his supporters employed delaying tactics, the tried to adjourn the session

then walked out. Only 12 Senators were left in the hall. The members of the senate left continued the session and

Senator Cuenco was appointed as the Acting President of the Senate and was recognized the next day by the

President of the Philippines.

ISSUES:

1. Whether or not the court has jurisdiction of the case.

2. Whether or not Resolutions 67 & 68 was validly approved.

HELD:

1. The Court has no jurisdiction of the case because the subject matter is political in nature and in doing so, the court

will be against the doctrine of separation of powers. To the first question, the answer is in the negative, in view of

the separation of powers, the political nature of the controversy (Alejandrino vs. Quezon, 46 Phil. 83; Vera vs.

Avelino, 77 Phil. 192; Mabanag vs. Lopez Vito, 78 Phil. 1) and the constitutional grant to the Senate of the power to

elect its own president, which power should not be interfered with, nor taken over, by the judiciary. We refused to

take cognizance of the Vera case even if the rights of the electors of the suspended senators were alleged affected

without any immediate remedy. A fortiori we should abstain in this case because the selection of the presiding

officer affect only the Senators themselves who are at l iberty at any time to choose their officers, change or reinstate

them. Anyway, if, as the petition must imply to be acceptable, the majority of the Senators want petitioner to

preside, his remedy lies in the Senate Session Hall not in the Supreme Court.2. It was held that there is a quorum that 12 being the majority of 23. In fine, all the four justice agree that the Court

being confronted with the practical situation that of the twenty three senators who may participate in the Senate

deliberations in the days immediately after this decision, twelve senators will support Senator Cuenco and, at most,

eleven will side with Senator Avelino, it would be most injudicious to declare the latter as the rightful President of

the Senate, that office being essentially one that depends exclusively upon the will of the majority of the senators,

the rule of the Senate about tenure of the President of that body being amenable at any time by that majority. And at


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any session hereafter held with thirteen or more senators, in order to avoid all controversy arising from the

divergence of opinion here about quorum and for the benefit of all concerned,the said twelve senators who approved

the resolutions herein involved could ratify all their acts and thereby place them beyond the shadow of a doubt.

Case Digest (Political Law)VERA V. AVELINO, 77 Phil. 863FACTS: Commission on Elections submitted last May 1946 to the President and theCongress of the Philippines a report regarding the national elections held theprevious month. It stated that by reason of certain specified acts of terrorism andviolence in the province of Pampanga, Nueva Ecija, Bulacan and Tarlac, the votingin said region did not reflect the true and free expression of the popular will.

During the session, when the senate convened on May 25, 1946, a pendatumresolution was approved referring to the report ordering that Jose O. Vera, RamonDiokno and Jose E. Romero who had been included among the 16 candidates for senator receiving the highest number of votes, proclaimed by the Commissions onElections shall not be sworn, nor seated, as members of the chamber, pending thetermination of the of the protest lodged against their election.

Petitioners thus immediately instituted an action against their colleagues responsiblefor the resolution, praying for an order to annul it and compelling respondents topermit them to occupy their seats and to exercise their senatorial prerogative. Theyalso allege that only the Electoral Tribunal had jurisdiction over contests relating totheir election, returns and qualifications. Respondents assert the validity of thependatum resolution.

.ISSUE:

1.Whether the Commission on Elections has the jurisdiction to determine whether or not votes cast in the said provinces are valid.

2.Whether administration of oath and the sitting of Jose O. Vera, Ramon Diokno andJose Romero should be deferred pending hearing and decision on the protestslodged against their elections.

RULING:

The Supreme Court refused to intervene, under the concept of separation of powers,holding that the case was not a contest, and affirmed the inherent right of thelegislature to determine who shall be admitted to its membership.

Granting that the postponement of the administration of the oath amounts tosuspension of the petitioners from their office, and conceding arguendo that such


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suspension is beyond the power of the respondents, who in effect are and acted asthe Philippine Senate (Alejandrino vs. Quezon, 46 Phil., 83, 88),this petition shouldbe denied. As was explained in the Alejandrino case, we could not order one branchof the Legislature to reinstate a member thereof. To do so would be to establish

judicial predominance, and to upset the classic pattern of checks and balances

wisely woven into our institutional setup.

The Constitution provides (Article VI, section 15) that "for any speech or debate" incongress, Senators and congressmen "shall not be questioned in any other place."

The Supreme Court of the United States has interpreted this privilege to include thegiving of a vote or the presentation of a resolution.

. . . It would be a narrow view of the constitutional provision to limit it towards spokenin debate. The reason of the rule is as forcible in its application to written reportspresented in that body by its committees, to resolutions offered, which, though inwriting, must be reproduced in speech, and to the act of voting, . . . (Kilbourn vs.thompson, 103 U.S., 204; 26 Law. ed., 377, p. 391.)

In the above case, Kilbourn, for refusing to answer questions put to him by theHouse of Representatives of the United States Congress, concerning the businessof a real estate partnership, was imprisoned for contempt by resolution of the house.He sued to recover damages from the sergeant at arms and the congressionalmembers of the committee, who had caused him to be brought before the house,where he was adjudged to be in contempt. The Supreme Court of the United States

found that the resolution of the House was void for want of jurisdiction in that body,but the action was dismissed as to the members of the committee upon the strengthof the herein above-mentioned congressional immunity. The court cited withapproval the following excerpts from an earlier decision of the Supreme Court of Massachusetts:

These privileges are thus secured, not with the intention of protecting the membersagainst prosecutions for their own benefit, but to support the rights of the people, byenabling their representatives to execute the functions of their office without fear of prosecutions, civil or criminal. I, therefore, think that the article ought not to beconstrued strictly, but liberally, that the full design of it may be answered. . . (103U.S., 203.) (Emphasis ours.)Commenting on this Congressional privilege, Willoughby relates apparently ascontrolling, the following incident:

In 1910, several Members of Congress having been served with a writ of mandamusin a civil action brought against them as members of the Joint Committee on Printingand growing out a refusal of a bid of the Valley Paper Company, for the furnishing of


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paper, the Senate resolved that the Justice issuing the writ had "unlawfully invadedthe constitutional privileges and prerogatives of the Senate of the United States andof three Senators; and was without jurisdiction to grant the rule, and Senators aredirected to make no appearance in response thereto." (Willoughby on theConstitution of the United States, Vol. I, Second Edition, p. 616.)

Respondents are, by this proceeding, called to account for their votes in approvingthe Pendatum Resolution. Having sworn to uphold the Constitution, we must enforcethe constitutional directive. We must not question, nor permit respondents to bequestioned here in connection with their votes. (Kilbourn vs. Thompson, supra.)

Case dismissed.

U.S. V. PONS, G.R. NO. L-11530 AUGUST 12, 1916

FACTS:

The defendant appellant Juan Pons et.al were charged with the crime of illegalimportation of opium,

Pon's counsel alleged and offered to prove that the last day of the special session of the Philippine Legislature for 1914 was the 28th day of February; that Act No. 2381,under which Pons must be punished if found guilty, was not passed or approved onthe 28th of February but on March 1 of that year; and that, therefore, the same isnull and void. The validity of the Act is not otherwise questioned. As it is admittedthat the last day of the special session was, under the Governor-General's

proclamation, February 28 and that the appellant is charged with having violated theprovisions of Act No. 2381, the vital question is the date of adjournment of theLegislature, and this reduces itself to two others, namely, (1) how that is to beproved, whether by the legislative journals or extraneous evidence and (2) whether the court can take judicial notice of the journals.

Passing over the question whether the printed Act (No. 2381), published by authorityof law, is conclusive evidence as to the date when it was passed, we will inquirewhether the courts may go behind the legislative journals for the purpose of determining the date of adjournment when such journals are clear and explicit. Fromthe foregoing it is clear that this investigation belongs entirely to that branch of legalscience which embraces and illustrates the laws of evidence.In the case from which this last quotation is taken, the court cited numerousdecisions of the various states in the American Union in support of the rule thereinlaid down, and we have been unable to find a single case of a later date where therule has been in the least changed or modified when the legislative journals cover the point. As the Constitution of the Philippine Government is modeled after those of the Federal Government and the various states, we do not hesitate to follow the


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courts in that country in the matter now before us. The journals say that theLegislature adjourned at 12 midnight on February 28, 1914. This settles thequestion, and the court did not err in declining to go behind these journals.

Affirmed the decision.

MORALES V. SUBIDO, 27 SCRA 792

FACTS: At the behest of Senator Francisco Rodrigo, the phrase "has served asofficer in the Armed Forces" was inserted in the proposed measure.

No person may be appointed chief of a city police agency unless he holds abachelor's degree and has served either in the Armed Forces of the Philippines or the National Bureau of Investigation or police department of any city and has heldthe rank of captain or its equivalent therein for at least three years or any highschool graduate who has served the police department of a city or who has servedas officer of the Armed Forces for at least 8 years with the rank of captain and/or higher.

It is to be noted that the Rodrigo amendment was in the nature of an addition to thephrase "who has served the police department of a city for at least 8 years with therank of captain and/or higher," under which the petitioner herein, who is at least ahigh school graduate (both parties agree that the petitioner finished the second year of the law course) could possibly qualify. However, somewhere in the legislativeprocess the phrase ["who has served the police department of a city or"] wasdropped and only the Rodrigo amendment was retained.

The present insistence of the petitioner is that the version of the provision, asamended at the behest of Sen. Rodrigo, was the version approved by the Senate onthird reading, and that when the bill emerged from the conference committee theonly change made in the provision was the insertion of the phrase "or has served aschief of police with exemplary record".

In support of this assertion, the petitioner submitted documents to prove hiscontentions:

It would thus appear that the omission whether deliberate or unintended of thephrase, "who has served the police department of a city or was made not at anystage of the legislative proceedings but only in the course of the engrossment of thebill, more specifically in the proofreading thereof; that the change was made not byCongress but only by an employee thereof; and that what purportedly was arewriting to suit some stylistic preferences was in truth an alteration of meaning. It isfor this reason that the petitioner would have us look searchingly into the matter.

The petitioner wholly misconceives the function of the judiciary under our system of


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government. As we observed explicitly in our decision, the enrolled Act in the officeof the legislative secretary of the President of the Philippines shows that section 10is exactly as it is in the statute as officially published in slip form by the Bureau of Printing. We cannot go behind the enrolled Act to discover what really happened.The respect due to the other branches of the Government demands that we act

upon the faith and credit of what the officers of the said branches attest to as theofficial acts of their respective departments. Otherwise we would be cast in theunenviable and unwanted role of a sleuth trying to determine what actually didhappen in the labyrinth of law-making with consequent impairment of the integrity of the legislative process. The investigation which the petitioner would like this Court tomake can be better done in Congress.

The motions for reconsideration are denied.

TOLENTINO V. SEC. OF FINANCE, 235 SCRA 630

First. Petitioners' contention is that Republic Act No. 7716 did not "originateexclusively" in the House of Representatives as required by Art. VI, Section 24 of theConstitution, because it is in fact the result of the consolidation of two distinct bills,H. No. 11197 and S. No. 1630.

This argument will not bear analysis. To begin with, it is not the law but the revenuebill which is required by the Constitution to "originate exclusively" in the House of Representatives. It is important to emphasize this, because a bill originating in theHouse may undergo such extensive changes in the Senate that the result may be arewriting of the whole. The possibility of a third version by the conference committee

will be discussed later. At this point, what is important to note is that, as a result of the Senate action, a distinct bill may be produced. To insist that a revenue statuteand not only the bill which initiated the legislative process culminating in theenactment of the law must substantially be the same as the House bill would be todeny the Senate's power not only to "concur with amendments" but also to "proposeamendments." It would be to violate the coequality of legislative power of the twohouses of Congress and in fact make the House superior to the Senate.

what the Constitution simply means is that the initiative for filing revenue, tariff, or tax bills, bills authorizing an increase of the public debt, private bills and bills of localapplication must come from the House of Representatives on the theory that,elected as they are from the districts, the members of the House can be expected tobe more sensitive to the local needs and problems. On the other hand, the senators,who are elected at large, are expected to approach the same problems from thenational perspective. Both views are thereby made to bear on the enactment of suchlaws.Nor does the Constitution prohibit the filing in the Senate of a substitute bill inanticipation of its receipt of the bill from the House, so long as action by the Senateas a body is withheld pending receipt of the House bill.


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We now pass to the next argument of petitioners that S. No. 1630 did not pass threereadings on separate days as required by the Constitution[8] because the secondand third readings were done on the same day, March 24, 1994. But this wasbecause on February 24, 1994[9] and again on March 22, 1994,[10] the Presidenthad certified S. No. 1630 as urgent. The presidential certification dispensed with the

requirement not only of printing but also that of reading the bill on separate days.The phrase "except when the President certifies to the necessity of its immediateenactment, etc." in Art. VI, Section 26[2] qualifies the two stated conditions before abill can become a law: [i] the bill has passed three readings on separate days and [ii]t has been printed in its final form and distributed three days before it is finallyapproved.In other words, the "unless" clause must be read in relation to the "except" clause,because the two are really coordinate clauses of the same sentence. To construethe "except" clause as simply dispensing with the second requirement in the "unless"clause [i.e., printing and distribution three days before final approval] would not onlyviolate the rules of grammar. It would also negate the very premise of the "except"clause: the necessity of securing the immediate enactment of a bill which is certifiedin order to meet a public calamity or emergency. For if it is only the printing that isdispensed with by presidential certification, the time saved would be so negligible asto be of any use in insuring immediate enactment. It may well be doubted whether doing away with the necessity of printing and distributing copies of the bill three daysbefore the third reading would insure speedy enactment of a law in the face of anemergency requiring the calling of a special election for President and Vice-President. Under the Constitution, such a law is required to be made within sevendays of the convening of Congress in emergency session.That upon the certification of a bill by the President, the requirement of three

readings on separate days and of printing and distribution can be dispensed with issupported by the weight of legislative practice.Third. Finally it is contended that the bill which became Republic Act No. 7716 is thebill which the Conference Committee prepared by consolidating H. No. 11197 and S.No. 1630. It is claimed that the Conference Committee report included provisions notfound in either the House bill or the Senate bill and that these provisions were"surreptitiously" inserted by the Conference Committee.this Court recently held that it is within the power of a conference committee toinclude in its report an entirely new provision that is not found either in the House billor in the Senate bill.[17] If the committee can propose an amendment consisting of one or two provisions, there is no reason why it cannot propose several provisions,collectively considered as an "amendment in the nature of a substitute," so long assuch amendment is germane to the subject of the bills before the committee. After all, its report was not final but needed the approval of both houses of Congress tobecome valid as an act of the legislative department. The charge that in this casethe Conference Committee acted as a third legislative chamber is thus without anybasis.Fourth. Whatever doubts there may be as to the formal validity of Republic Act No.7716 must be resolved in its favor. Our cases[20] manifest firm adherence to the


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rule that an enrolled copy of a bill is conclusive not only of its provisions but also of its due enactment.But where allegations that the constitutional procedures for the passage of bills havenot been observed have no more basis than another allegation that the ConferenceCommittee "surreptitiously" inserted provisions into a bill which it had prepared, we

should decline the invitation to go behind the enrolled copy of the bill. To disregardthe "enrolled bill" rule in such cases would be to disregard the respect due the other two departments of our government.

Fifth. An additional attack on the formal validity of Republic Act No. 7716 is made bythe Philippine Airlines, Inc., petitioner in G. R. No. 11582, namely, that it violates Art.VI, Section 26[1] which provides that "Every bill passed by Congress shall embraceonly one subject which shall be expressed in the title thereof." It is contended thatneither H. No. 11197 nor S. No. 1630 provided for removal of exemption of PALtransactions from the payment of the VAT and that this was made only in theConference Committee bill which became Republic Act No. 7716 without reflectingthis fact in its title.The question is whether this amendment of Section 103 of the NIRC is fairlyembraced in the title of Republic Act No. 7716, although no mention is made thereinof P. D. No. 1590 as among those which the statute amends. We think it is, sincethe title states that the purpose of the statute is to expand the VAT system, and oneway of doing this is to widen its base by withdrawing some of the exemptionsgranted before. To insist that P. D. No. 1590 be mentioned in the title of the law, inaddition to Section 103 of the NIRC, in which it is specifically referred to, would be toinsist that the title of a bill should be a complete index of its content.The constitutional requirement that every bill passed by Congress shall embrace

only one subject which shall be expressed in its title is intended to prevent surpriseupon the members of Congress and to inform the people of pending legislation sothat, if they wish to, they can be heard regarding it. If, in the case at bar, petitioner did not know before that its exemption had been withdrawn, it is not because of anydefect in the title but perhaps for the same reason other statutes, althoughpublished, pass unnoticed until some event somehow calls attention to their existence. Indeed, the title of Republic Act No. 7716 is not any more general thanthe title of PAL's own franchise under P. D. No. 1590, and yet no mention is made of its tax exemption. The title of P. D. No. 1590 is:

TIO VS. VIDEOGRAM REGULATORY BOARD [151 SCRA 208; G.R. No. L-75697;18 Jun 1987]Facts: Petitioner's attack on the constitutionality of the DECREE rests on thefollowing grounds:

1. Section 10 thereof, which imposes a tax of 30% on the gross receipts payable tothe local government is a RIDER and the same is not germane to the subject matter thereof;


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2. The tax imposed is harsh, confiscatory, oppressive and/or in unlawful restraint of trade in violation of the due process clause of the Constitution;

3. There is no factual nor legal basis for the exercise by the President of the vast

powers conferred upon him by Amendment No. 6;4. There is undue delegation of power and authority;5. The Decree is an ex-post facto law; and

6. There is over regulation of the video industry as if it were a nuisance, which it isnot.

We shall consider the foregoing objections in seriatim.1. The Constitutional requirement that "every bill shall embrace only one subjectwhich shall be expressed in the title thereof" 1 is sufficiently complied with if the titlebe comprehensive enough to include the general purpose which a statute seeks toachieve. It is not necessary that the title express each and every end that the statutewishes to accomplish. The requirement is satisfied if all the parts of the statute arerelated, and are germane to the subject matter expressed in the title, or as long asthey are not inconsistent with or foreign to the general subject and title. 2 An acthaving a single general subject, indicated in the title, may contain any number of provisions, no matter how diverse they may be, so long as they are not inconsistentwith or foreign to the general subject, and may be considered in furtherance of suchsubject by providing for the method and means of carrying out the general object." 3The rule also is that the constitutional requirement as to the title of a bill should not

be so narrowly construed as to cripple or impede the power of legislation. 4 It shouldbe given practical rather than technical construction. 5Tested by the foregoing criteria, petitioner's contention that the tax provision of theDECREE is a rider is without merit. That section reads, inter alia:Section 10. Tax on Sale, Lease or Disposition of Videograms. Notwithstandingany provision of law to the contrary, the province shall collect a tax of thirty percent(30%) of the purchase price or rental rate, as the case may be, for every sale, leaseor disposition of a videogram containing a reproduction of any motion picture or audiovisual program. Fifty percent (50%) of the proceeds of the tax collected shallaccrue to the province, and the other fifty percent (50%) shall acrrue to themunicipality where the tax is collected; PROVIDED, That in Metropolitan Manila, thetax shall be shared equally by the City/Municipality and the Metropolitan ManilaCommission.xxx xxx xxxThe foregoing provision is allied and germane to, and is reasonably necessary for the accomplishment of, the general object of the DECREE, which is the regulation of the video industry through the Videogram Regulatory Board as expressed in its title.The tax provision is not inconsistent with, nor foreign to that general subject and title.

As a tool for regulation 6 it is simply one of the regulatory and control mechanisms


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scattered throughout the DECREE. The express purpose of the DECREE to includetaxation of the video industry in order to regulate and rationalize the heretoforeuncontrolled distribution of videograms is evident from Preambles 2 and 5, supra.Those preambles explain the motives of the lawmaker in presenting the measure.The title of the DECREE, which is the creation of the Videogram Regulatory Board,

is comprehensive enough to include the purposes expressed in its Preamble andreasonably covers all its provisions. It is unnecessary to express all those objectivesin the title or that the latter be an index to the body of the DECREE.

2. Petitioner also submits that the thirty percent (30%) tax imposed is harsh andoppressive, confiscatory, and in restraint of trade. However, it is beyond seriousquestion that a tax does not cease to be valid merely because it regulates,discourages, or even definitely deters the activities taxed. 8 The power to imposetaxes is one so unlimited in force and so searching in extent, that the courts scarcelyventure to declare that it is subject to any restrictions whatever, except such as restin the discretion of the authority which exercises it. 9 In imposing a tax, thelegislature acts upon its constituents. This is, in general, a sufficient security againsterroneous and oppressive taxation.

The tax imposed by the DECREE is not only a regulatory but also a revenuemeasure prompted by the realization that earnings of videogram establishments of around P600 million per annum have not been subjected to tax, thereby deprivingthe Government of an additional source of revenue. It is an end-user tax, imposedon retailers for every videogram they make available for public viewing. It is similar to the 30% amusement tax imposed or borne by the movie industry which thetheater-owners pay to the government, but which is passed on to the entire cost of

the admission ticket, thus shifting the tax burden on the buying or the viewing public.It is a tax that is imposed uniformly on all videogram operators.The levy of the 30% tax is for a public purpose. It was imposed primarily to answer the need for regulating the video industry, particularly because of the rampant filmpiracy, the flagrant violation of intellectual property rights, and the proliferation of pornographic video tapes. And while it was also an objective of the DECREE toprotect the movie industry, the tax remains a valid imposition.

The public purpose of a tax may legally exist even if the motive which impelled thelegislature to impose the tax was to favor one industry over another. 11It is inherent in the power to tax that a state be free to select the subjects of taxation,and it has been repeatedly held that "inequities which result from a singling out of one particular class for taxation or exemption infringe no constitutional limitation". 12Taxation has been made the implement of the state's police power. 13

At bottom, the rate of tax is a matter better addressed to the taxing legislature.

3. Petitioner argues that there was no legal nor factual basis for the promulgation of the DECREE by the former President under Amendment No. 6 of the 1973Constitution providing that "whenever in the judgment of the President ... , there


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exists a grave emergency or a threat or imminence thereof, or whenever the interimBatasang Pambansa or the regular National Assembly fails or is unable to actadequately on any matter for any reason that in his judgment requires immediateaction, he may, in order to meet the exigency, issue the necessary decrees, orders,or letters of instructions, which shall form part of the law of the land."

In refutation, the Intervenors and the Solicitor General's Office aver that the 8th"whereas" clause sufficiently summarizes the justification in that grave emergenciescorroding the moral values of the people and betraying the national economicrecovery program necessitated bold emergency measures to be adopted withdispatch. Whatever the reasons "in the judgment" of the then President, consideringthat the issue of the validity of the exercise of legislative power under the said

Amendment still pends resolution in several other cases, we reserve resolution of the question raised at the proper time.

4. Neither can it be successfully argued that the DECREE contains an unduedelegation of legislative power. The grant in Section 11 of the DECREE of authorityto the BOARD to "solicit the direct assistance of other agencies and units of thegovernment and deputize, for a fixed and limited period, the heads or personnel of such agencies and units to perform enforcement functions for the Board" is not adelegation of the power to legislate but merely a conferment of authority or discretion as to its execution, enforcement, and implementation. "The true distinctionis between the delegation of power to make the law, which necessarily involves adiscretion as to what it shall be, and conferring authority or discretion as to itsexecution to be exercised under and in pursuance of the law. The first cannot bedone; to the latter, no valid objection can be made." 14 Besides, in the very

language of the decree, the authority of the BOARD to solicit such assistance is for a "fixed and limited period" with the deputized agencies concerned being "subject tothe direction and control of the BOARD." That the grant of such authority might bethe source of graft and corruption would not stigmatize the DECREE asunconstitutional. Should the eventuality occur, the aggrieved parties will not bewithout adequate remedy in law.

5. The DECREE is not violative of the ex post facto principle. An ex post facto law is,among other categories, one which "alters the legal rules of evidence, andauthorizes conviction upon less or different testimony than the law required at thetime of the commission of the offense." It is petitioner's position that Section 15 of the DECREE in providing that:

All videogram establishments in the Philippines are hereby given a period of forty-five (45) days after the effectivity of this Decree within which to register with andsecure a permit from the BOARD to engage in the videogram business and toregister with the BOARD all their inventories of videograms, including videotapes,discs, cassettes or other technical improvements or variations thereof, before theycould be sold, leased, or otherwise disposed of. Thereafter any videogram found in


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the possession of any person engaged in the videogram business without therequired proof of registration by the BOARD, shall be prima facie evidence of violation of the Decree, whether the possession of such videogram be for privateshowing and/or public exhibition.

raises immediately a prima facie evidence of violation of the DECREE when therequired proof of registration of any videogram cannot be presented and thuspartakes of the nature of an ex post facto law.The argument is untenable. As this Court held in the recent case of Vallarta vs.Court of Appeals, et al.

... it is now well settled that "there is no constitutional objection to the passage of alaw providing that the presumption of innocence may be overcome by a contrarypresumption founded upon the experience of human conduct, and enacting whatevidence shall be sufficient to overcome such presumption of innocence" (Peoplevs. Mingoa 92 Phil. 856 [1953] at 858-59, citing 1 COOLEY, A TREATISE ON THECONSTITUTIONAL LIMITATIONS, 639-641). And the "legislature may enact thatwhen certain facts have been proved that they shall be prima facie evidence of theexistence of the guilt of the accused and shift the burden of proof provided there bea rational connection between the facts proved and the ultimate facts presumed sothat the inference of the one from proof of the others is not unreasonable andarbitrary because of lack of connection between the two in common experience".

Applied to the challenged provision, there is no question that there is a rationalconnection between the fact proved, which is non-registration, and the ultimate factpresumed which is violation of the DECREE, besides the fact that the prima facie

presumption of violation of the DECREE attaches only after a forty-five-day periodcounted from its effectivity and is, therefore, neither retrospective in character.6. We do not share petitioner's fears that the video industry is being over-regulatedand being eased out of existence as if it were a nuisance. Being a relatively newindustry, the need for its regulation was apparent. While the underlying objective of the DECREE is to protect the moribund movie industry, there is no question thatpublic welfare is at bottom of its enactment, considering "the unfair competitionposed by rampant film piracy; the erosion of the moral fiber of the viewing publicbrought about by the availability of unclassified and unreviewed video tapescontaining pornographic films and films with brutally violent sequences; and lossesin government revenues due to the drop in theatrical attendance, not to mention thefact that the activities of video establishments are virtually untaxed since merepayment of Mayor's permit and municipal license fees are required to engage inbusiness.

The enactment of the Decree since April 10, 1986 has not brought about the"demise" of the video industry. On the contrary, video establishments are seen tohave proliferated in many places notwithstanding the 30% tax imposed.


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In the last analysis, what petitioner basically questions is the necessity, wisdom andexpediency of the DECREE. These considerations, however, are primarily andexclusively a matter of legislative concern.Only congressional power or competence, not the wisdom of the action taken, maybe the basis for declaring a statute invalid. This is as it ought to be. The principle of

separation of powers has in the main wisely allocated the respective authority of each department and confined its jurisdiction to such a sphere. There would then beintrusion not allowable under the Constitution if on a matter left to the discretion of acoordinate branch, the judiciary would substitute its own. If there be adherence tothe rule of law, as there ought to be, the last offender should be courts of justice, towhich rightly litigants submit their controversy precisely to maintain unimpaired thesupremacy of legal norms and prescriptions. The attack on the validity of thechallenged provision likewise insofar as there may be objections, even if valid andcogent on its wisdom cannot be sustained. 18In fine, petitioner has not overcome the presumption of validity which attaches to achallenged statute. We find no clear violation of the Constitution which would justifyus in pronouncing Presidential Decree No. 1987 as unconstitutional and void.WHEREFORE, the instant Petition is hereby dismissed.

GUINGONA v. CARAGUE, G.R. No. 94571 April 22, 1991

This is a case of first impression whereby petitioners question the constitutionality of the automatic appropriation for debt service in the 1990 budget.

The said automatic appropriation for debt service is authorized by P.D. No. 81,entitled "Amending Certain Provisions of Republic Act Numbered Four Thousand

Eight Hundred Sixty, as Amended (Re: Foreign Borrowing Act)," by P.D. No. 1177,entitled "Revising the Budget Process in Order to Institutionalize the BudgetaryInnovations of the New Society," and by P.D. No. 1967, entitled "An ActStrenghthening the Guarantee and Payment Positions of the Republic of thePhilippines on Its Contingent Liabilities Arising out of Relent and Guaranteed Loanby Appropriating Funds For The Purpose.

The petitioner seek the declaration of the unconstitutionality of P.D. No. 81, Sections31 of P.D. 1177, and P.D. No. 1967. The petition also seeks to restrain thedisbursement for debt service under the 1990 budget pursuant to said decrees.

Petitioners argue that the said automatic appropriations under the aforesaid decreesof then President Marcos became functus oficio when he was ousted in February,1986; that upon the expiration of the one-man legislature in the person of PresidentMarcos, the legislative power was restored to Congress on February 2, 1987 whenthe Constitution was ratified by the people; that there is a need for a new legislationby Congress providing for automatic appropriation, but Congress, up to the present,has not approved any such law; and thus the said P86.8 Billion automaticappropriation in the 1990 budget is an administrative act that rests on no law, and


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thus, it cannot be enforced.Moreover, petitioners contend that assuming arguendo that P.D. No. 81, P.D. No.1177 and P.D. No. 1967 did not expire with the ouster of President Marcos, after theadoption of the 1987 Constitution, the said decrees are inoperative under Section 3,

Article XVIII which provides

Sec. 3. All existing laws, decrees, executive orders, proclamations, letters of instructions, and other executive issuances not inconsistent with this Constitutionshall remain operative until amended, repealed, or revoked." (Emphasis supplied.)They then point out that since the said decrees are inconsistent with Section 24,

Article VI of the Constitution, i.e.,Sec. 24. All appropriation, revenue or tariff bills, bills authorizing increase of thepublic debt, bills of local application, and private bills shall originate exclusively in theHouse of Representatives, but the Senate may propose or concur withamendments. (Emphasis supplied.)whereby bills have to be approved by the President, then a law must be passed byCongress to authorize said automatic appropriation. Further, petitioners state saiddecrees violate Section 29(l) of Article VI of the Constitution which provides asfollows Sec. 29(l). No money shall be paid out of the Treasury except in pursuance of anappropriation made by law.They assert that there must be definiteness, certainty and exactness in anappropriation, otherwise it is an undue delegation of legislative power to thePresident who determines in advance the amount appropriated for the debt service.12

RULING:The Court is not persuaded.

Section 3, Article XVIII of the Constitution recognizes that "All existing laws, decrees,executive orders, proclamations, letters of instructions and other executiveissuances not inconsistent with the Constitution shall remain operative untilamended, repealed or revoked."This transitory provision of the Constitution has precisely been adopted by itsframers to preserve the social order so that legislation by the then President Marcosmay be recognized. Such laws are to remain in force and effect unless they areinconsistent with the Constitution or, are otherwise amended, repealed or revoked.The Court, therefor, finds that R.A. No. 4860, as amended by P.D. No. 81, Section31 of P.D. 1177 and P.D. No. 1967 constitute lawful authorizations or appropriations,unless they are repealed or otherwise amended by Congress. The Executive wasthus merely complying with the duty to implement the same.


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SENATE VS. ERMITA , GR 169777 APRIL 20, 2006

FACTS: This is a petition for certiorari and prohibition proffer that the President hasabused power by issuing E.O. 464 Ensuring Observance of the Principles of

Separation of Powers, Adherence to the Rule on Executive Privilege and Respectfor the Rights of Public Officials Appearing in Legislative Inquiries in Aid of Legislation Under the Constitution, and for Other Purposes. Petitioners pray for itsdeclaration as null and void for being unconstitutional.

In the exercise of its legislative power, the Senate of the Philippines, through itsvarious Senate Committees, conducts inquiries or investigations in aid of legislationwhich call for, inter alia, the attendance of officials and employees of the executivedepartment, bureaus, and offices including those employed in Government Ownedand Controlled Corporations, the Armed Forces of the Philippines (AFP), and thePhilippine National Police (PNP).

The Committee of the Senate issued invitations to various officials of the ExecutiveDepartment for them to appear as resource speakers in a public hearing on therailway project, others on the issues of massive election fraud in the Philippineelections, wire tapping, and the role of military in the so-called Gloriagate Scandal.

Said officials were not able to attend due to lack of consent from the President asprovided by E.O. 464, Section 3 which requires all the public officials enumerated inSection 2(b) to secure the consent of the President prior to appearing before either house of Congress.

The power of inquiryThe Congress power of inquiry is expressly recognized in Section 21 of Article VI of the Constitution which reads:SECTION 21. The Senate or the House of Representatives or any of its respectivecommittees may conduct inquiries in aid of legislation in accordance with its dulypublished rules of procedure. The rights of persons appearing in or affected by suchinquiries shall be respected. (Underscoring supplied)

ISSUE:

Is Section 3 of E.O. 464, which requires all the public officials, enumerated inSection 2(b) to secure the consent of the President prior to appearing before either house of Congress, valid and constitutional?

RULING:

No. The enumeration in Section 2 (b) of E.O. 464 is broad and is covered by theexecutive privilege. The doctrine of executive privilege is premised on the fact that


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certain information must, as a matter of necessity, be kept confidential in pursuit of the public interest. The privilege being, by definition, an exemption from theobligation to disclose information, in this case to Congress, the necessity must be of such high degree as to outweigh the public interest in enforcing that obligation in aparticular case.

Congress undoubtedly has a right to information from the executive branchwhenever it is sought in aid of legislation. If the executive branch withholds suchinformation on the ground that it is privileged, it must so assert it and state thereason therefor and why it must be respected.

The infirm provisions of E.O. 464, however, allow the executive branch to evadecongressional requests for information without need of clearly asserting a right to doso and/or proffering its reasons therefor. By the mere expedient of invoking saidprovisions, the power of Congress to conduct inquiries in aid of legislation isfrustrated.

A claim of privilege, being a claim of exemption from an obligation to discloseinformation, must, therefore, be clearly asserted. As U.S. v. Reynolds teaches:Note: The privilege belongs to the government and must be asserted by it; it canneither be claimed nor waived by a private party. It is not to be lightly invoked. Theremust be a formal claim of privilege, lodged by the head of the department which hascontrol over the matter, after actual personal consideration by that officer. The courtitself must determine whether the circumstances are appropriate for the claim of privilege, and yet do so without forcing a disclosure of the very thing the privilege isdesigned to protect.92 (Underscoring supplied)

Absent then a statement of the specific basis of a claim of executive privilege, thereis no way of determining whether it falls under one of the traditional privileges, or whether, given the circumstances in which it is made, it should be respected.93These, in substance, were the same criteria in assessing the claim of privilegeasserted against the Ombudsman in Almonte v. Vasquez94 and, more in point,against a committee of the Senate in Senate Select Committee on PresidentialCampaign Activities v. Nixon.

[T]he lack of specificity renders an assessment of the potential harm resulting fromdisclosure impossible, thereby preventing the Court from balancing such harmagainst plaintiffs needs to determine whether to override any claims of privilege.

A formal and proper claim of executive privilege requires a specific designation anddescription of the documents within its scope as well as precise and certain reasonsfor preserving their confidentiality. Without this specificity, it is impossible for a courtto analyze the claim short of disclosure of the very thing sought to be protected. Asthe affidavit now stands, the Court has little more than its sua sponte speculationwith which to weigh the applicability of the claim. An improperly asserted claim of privilege is no claim of privilege. Therefore, despite the fact that a claim was made


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by the proper executive as Reynolds requires, the Court can not recognize the claimin the instant case because it is legally insufficient to allow the Court to make a justand reasonable determination as to its applicability. To recognize such a broad claimin which the Defendant has given no precise or compelling reasons to shield thesedocuments from outside scrutiny, would make a farce of the whole procedure.101

(Emphasis and underscoring supplied)Due respect for a co-equal branch of government, moreover, demands no less thana claim of privilege clearly stating the grounds therefor.

Note: Petitioners, however, assert as another ground for invalidating the challengedorder the alleged unlawful delegation of authority to the heads of offices in Section2(b). Petitioner Senate of the Philippines, in particular, cites the case of the UnitedStates where, so it claims, only the President can assert executive privilege towithhold information from Congress.

OSMEA v. ORBOS, 220 SCRA 703

Facts: On October 10, 1984, Pres. Marcos issued P.D. 1956 creating a Special Account in the General Fund, designated as the Oil Price Stabilization Fund (OPSF).The OPSF was designed to reimburse oil companies for cost increases in crude oiland imported petroleum products resulting from exchange rate adjustments andfrom increases in the world market prices of crude oil.

Subsequently, the OPSF was reclassified into a "trust liability account," in virtue of E.O. 1024, and ordered released from the National Treasury to the Ministry of Energy.

Pres. Aquino, amended P.D. 1956. She promulgated Executive Order No. 137 onFebruary 27, 1987, expanding the grounds for reimbursement to oil companies for possible cost underrecovery incurred as a result of the reduction of domestic pricesof petroleum products, the amount of the underrecovery being left for determinationby the Ministry of Finance.

The petition avers that the creation of the trust fund violates 29(3), Article VI of theConstitution, reading as follows:

(3) All money collected on any tax levied for a special purpose shall be treated as aspecial fund and paid out for such purposes only. If the purpose for which a specialfund was created has been fulfilled or abandoned, the balance, if any, shall betransferred to the general funds of the Government.

The petitioner argues that "the monies collected pursuant to . . P.D. 1956, asamended, must be treated as a 'SPECIAL FUND,' not as a 'trust account' or a 'trust


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fund,' and that "if a special tax is collected for a specific purpose, the revenuegenerated therefrom shall 'be treated as a special fund' to be used only for thepurpose indicated, and not channeled to another government objective." Petitioner further points out that since "a 'special fund' consists of monies collected through thetaxing power of a State, such amounts belong to the State, although the use thereof

is limited to the special purpose/objective for which it was created."He also contends that the "delegation of legislative authority" to the ERB violates 28(2). Article VI of the Constitution, viz.:

(2) The Congress may, by law, authorize the President to fix, within specified limits,and subject to such limitations and restrictions as it may impose, tariff rates, importand export quotas, tonnage and wharfage dues, and other duties or imposts withinthe framework of the national development program of the Government;

and, inasmuch as the delegation relates to the exercise of the power of taxation, "thelimits, limitations and restrictions must be quantitative, that is, the law must not onlyspecify how to tax, who (shall) be taxed (and) what the tax is for, but also impose aspecific limit on how much to tax.

Issues:

(1) Whether or Not the invalidity of the "TRUST ACCOUNT" in the books of accountof the Ministry of Energy (now, the Office of Energy Affairs), created pursuant to 8,paragraph 1, of P.D. No. 1956, as amended, "said creation of a trust fund beingcontrary to Section 29 (3), Article VI of the Constitution.

(2) Whether or Not the unconstitutionality of 8, paragraph 1 (c) of P.D. No. 1956, asamended by Executive Order No. 137, for "being an undue and invalid delegation of legislative power to the Energy Regulatory Board.

Held: The OPSF is a "Trust Account" which was established "for the purpose of minimizing the frequent price changes brought about by exchange rate adjustmentand/or changes in world market prices of crude oil and imported petroleumproducts." Under P.D. No. 1956, as amended by Executive Order No. 137 dated 27February 1987, this Trust Account may be funded from any of the following sources:

a) Any increase in the tax collection from ad valorem tax or customs duty imposedon petroleum products subject to tax under this Decree arising from exchange rateadjustment, as may be determined by the Minister of Finance in consultation withthe Board of Energy;

b) Any increase in the tax collection as a result of the lifting of tax exemptions of government corporations, as may be determined by the Minister of Finance in


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consultation with the Board of Energy;

c) Any additional amount to be imposed on petroleum products to augment theresources of the Fund through an appropriate Order that may be issued by theBoard of Energy requiring payment of persons or companies engaged in the

business of importing, manufacturing and/or marketing petroleum products;d) Any resulting peso cost differentials in case the actual peso costs paid by oilcompanies in the importation of crude oil and petroleum products is less than thepeso costs computed using the reference foreign exchange rate as fixed by theBoard of Energy.

Hence, it seems clear that while the funds collected may be referred to as taxes,they are exacted in the exercise of the police power of the State. Moreover, that theOPSF is a special fund is plain from the special treatment given it by E.O. 137. It issegregated from the general fund; and while it is placed in what the law refers to asa "trust liability account," the fund nonetheless remains subject to the scrutiny andreview of the COA. The Court is satisfied that these measures comply with theconstitutional description of a "special fund." Indeed, the practice is not withoutprecedent.

With regard to the alleged undue delegation of legislative power, the Court finds thatthe provision conferring the authority upon the ERB to impose additional amounts onpetroleum products provides a sufficient standard by which the authority must beexercised. In addition to the general policy of the law to protect the local consumer by stabilizing and subsidizing domestic pump rates, 8(c) of P.D. 1956 expressly

authorizes the ERB to impose additional amounts to augment the resources of theFund.

What petitioner would wish is the fixing of some definite, quantitative restriction, or "aspecific limit on how much to tax." The Court is cited to this requirement by thepetitioner on the premise that what is involved here is the power of taxation; but asalready discussed, this is not the case. What is here involved is not so much thepower of taxation as police power. Although the provision authorizing the ERB toimpose additional amounts could be construed to refer to the power of taxation, itcannot be overlooked that the overriding consideration is to enable the delegate toact with expediency in carrying out the objectives of the law which are embraced bythe police power of the State.The interplay and constant fluctuation of the various factors involved in thedetermination of the price of oil and petroleum products, and the frequently shiftingneed to either augment or exhaust the Fund, do not conveniently permit the settingof fixed or rigid parameters in the law as proposed by the petitioner. To do so wouldrender the ERB unable to respond effectively so as to mitigate or avoid theundesirable consequences of such fluidity. As such, the standard as it is expressed


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suffices to guide the delegate in the exercise of the delegated power, taking accountof the circumstances under which it is to be exercised.

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