Republic of the Philippines to the agreed upon amount of P1,200.00.

The judgment of the

SUPREME COURT Court of Appeals reads as follows:
Manila
WHEREFORE, the judgment appealed from is
SECOND DIVISION hereby reversed and set aside. In lieu thereof,
another one is rendered ordering the
G.R. No. L-38736 May 21, 1984 defendants Acopiados to pay the plaintiff the
sum of P1,200.00 with interest at a legal rate
from the date of the finality of this judgment
FELIPE G. TAC-AN, petitioner, until full payment thereof. No pronouncement
vs. as to costs. (Rollo, pp. 40-41.)
HONORABLE COURT OF APPEALS and ELEUTERIO
ACOPIADO, MAXIMINO ACOPIADO, the SPOUSES JESUS
PAGHASIAN and PILAR LIBETARIO, respondents. Petitioner Tac-An prays that the decision of the Court of Appeals
be set aside and that the decision of the Court of First Instance
be upheld instead.
Liliano B. Neri for petitioner.
The petition is not impressed with merit.
Vic T. Lacaya for private respondents.
The Court of Appeals found as a fact that the Acopiado brothers
fully understood the tenor of the Deed of Quitclaim which they
executed. But the Court of Appeals also found as a fact that the
ABAD SANTOS, J.: Acopiado brothers are Non-Christians, more specifically
Subanons, and that each is married to a Subanon. And because
The petitioner, Felipe G. Tac-An, is a lawyer whose services were they are Non-Christians, the Court of Appeals applied Section
engaged by the brothers Eleuterio Acopiado and Maximino 145 of the Administrative Code of Mindanao and Sulu which
Acopiado who were accused of frustrated murder and theft of reads as follows:
large cattle before the Municipal Court of New Piñan,
Zamboanga del Norte in March, 1960. Sec. 145. Contracts with Non-Christians requisites.
-- Save and except contracts of sale or barter of personal
On April 4, 1960, Tac-An caused a document entitled, "Deed of property and contracts of personal service comprehended
Quitclaim" to be thumb-marked by the Acopiado brothers in chapter seventeen hereof no contract or agreement
whereby for the sum of P1,200.00 representing his fees as their shall be made in the Department by any person with any
lawyer in the criminal cases, they conveyed to him a parcel of Moro or other non-Christian tribe or portion thereof the
land with an area of three hectares. The document was Department or with any individual Moro or other non-
acknowledged before Notary Public Pacifico Cimafranca on the Christian inhabitants of the same for the payment or
same date who explained its contents to the Acopiados. delivery of money or other things of value in present or in
prospective, or in the manner affecting or relating to any
real property, unless such contract or agreement be
On April 6, 1960, or two days after the execution of the deed, the executed and approved as follows:
Acopiados told Tac-An that they were terminating his services
because their wives and parents did not agree that the land be
given to pay for his services. They also said that they had hired xxx xxx xxx
another lawyer, a relative, to defend them. But Tac-An continued
to represent them. (b) It shall be executed before a judge of a court of record,
justice or auxilliary justice of the peace, or notary public,
In the case for frustrated murder, the Acopiados were acquitted. and shall bear the approval of the provincial governor
The cases for theft of large cattle were dismissed due to the wherein the same was executed or his representative duly
desistance of the complainants. authorized in writing for such purpose, indorsed upon it.

On April 2, 1961, Eleuterio sold his share of the land previously It should be stated that under Section 146 of the same Code,
conveyed to Tac-An to Jesus Paghasian and Pilar Libetario but contracts or agreements made in violation of Sec. 145 shall be
the latter did not take possession thereof. "null and void."

In June, 1964, Tac-An appointed Irineo Villejo, a barrio captain, It should be recalled that on July 2, 1964, Tac-An secured the
as his overseer in the land. On July 2, 1964, Tac-An also secured approval of the Provincial Governor of Zamboanga del Norte to
the approval of the Provincial Governor of Zamboanga del Norte the Deed of Quitclaim and that should have satisfied the
to the Deed of Quitclaim. And on October 7, 1964, Tac-An filed a requirement of Sec. 145 of the Administrative Code for Mindanao
complaint against the Acopiado brothers, Paghasian and and Sulu. But it appears that on April 12, 1965, while Tac-An's
Libetario in the CFI of Zamboanga del Norte. He prayed that he suit was pending in the trial court, the Governor of Zamboanga
be declared the owner of the land; that the sale made in favor of del Norte revoked his approval for the reasons stated therein.
Paghasian and owner Libetario be annulled; and that he be paid
damages, attorney's fees, etc. The petitioner now asserts that the revocation of the approval
which had been given by the Provincial Governor has no legal
The Court of First Instance decided in favor of Tac-An whereupon effect and cannot affect his right to the land which had already
the Acopiados, et al. appealed to the Court of Appeals. vested. But as Justice Conrado M. Vasquez, with Justices Mateo
Canonoy and Ameurfina M. Herrera concurring, said:

The Court of Appeals voided the transfer of the land to Tac-An

but held that for his services in the criminal cases he was entitled The approval by Provincial Governor Felipe Azcuna
appearing on the face of the Deed of Quitclaim (Exh. "E ")
made on July 2, 1964 may no longer be relied upon by the
 plaintiff in view of the revocation thereof by the same Petitioner Antonio J. Villegas, in this appeal from a decision of the
official on April 12, 1965 (Exh. 4). The revocation was lower court dismissing a special civil action for prohibition, quo
based on the ground that the signature of Governor warranto and mandamus would lay claim as the Mayor of the
Azcuna was obtained thru a false representation to the City of Manila to the power of appointment of the Assistant City
effect that the alleged transaction was legal and voluntary Treasurer to which office the other petitioner, Manuel D. Lapid,
when in truth and in fact, as found out later, the said parcel was by him named even if under its Charter 1 such a prerogative
of land was the subject matter of a court litigation; and, is expressly vested in the President of the Philippines.2 He would
moreover, the non-Christian vendors were not brought invoke a provision in the Decentralization Act to the effect that all
before him for interrogation, confirmation or ratification of "other employees, except teachers, paid out of provincial, city or
the alleged deed of quitclaim. The fact that the revocation municipal general funds, and other local funds shall, subject to
was made after the filing of instant action on October 10, civil service law, rules and regulations, be appointed by the
1964 does not vitiate the aforesaid action of the Provincial provincial governor, city or municipal mayor upon
Governor. Significantly, no attempt was made to disprove recommendation of the office head concerned."3 He is not
the truth of the reasons stated in the certificate of deterred by the rather general and in explicit character of such
revocation (Exh. 4). (Rollo, p. 37.) statutory language as he contends for a construction rather
generous, if not latitudinarian, in scope purportedly in
The petitioner also argues that the Administrative Code of consonance with the avowed purpose of the Act of enlarging
Mindanao and Sulu was repealed on June 19, 1965 by Republic boundaries of local autonomy. Respondent Abelardo Subido, who
Act No, 4252, hence the approval of the Provincial Governor was proceeded against as Commissioner of the Civil
became unnecessary. Suffice it to say that at times material to Service,4 takes a stand diametrically opposite not only because
the case, i.e. when the Deed of Quitclaim was executed, when there is no legal basis for such a claim in the light of what is
the approval by the Provincial Governor was given and when the expressly ordained in the City Charter but also because such an
approval was revoked, Sections 145 and 146 of the interpretation of the provision related upon would disregard the
Administrative Code of Mindanao and Sulu were in full force and well-settled doctrine that implied repeals are not favored. The
effect and since they were substantive in nature the repealing lower court, in a well-written decision by the Honorable Conrado
statute cannot be given retroactive effect. It should also be stated M. Vasquez, accepted such a view. After a careful study of the
that the land in question must be presumed to be conjugal in matter, we cannot discern any error. We affirm.
nature and since the spouses of the Acopiado brothers did not
consent to its transfer to the petitioner, the transaction was at The facts as found by the lower court follows: "In a letter dated
least voidable. June 3, 1968, respondent Eduardo Z. Romualdez, Secretary of
Finance, authorized respondent Jose R. Gloria of the Office of
WHEREFORE finding the petition to be lacking in merit, the the City Treasurer of Manila to assume the duties of Assistant
same is hereby dismissed with costs against the petitioner. City Treasurer effective June 1, 1968, vice Felino Fineza who
retired from the government service on May 31, 1968. In
administrative Order No. 40, series of 1968, dated June 17,
SO ORDERED. 1968, petitioner Antonio J. Villegas, Mayor of the City of Manila,
directed respondent Gloria to desist and refrain from exercising
the duties and functions of the Assistant City Treasurer,' on the
ground that respondent Romualdez "is not empowered to make
such designation." On January 1, 1969, Mayor Villegas,
appointed petitioner Manuel D. Lapid, chief of the cash division of
the Office of the City Treasurer of Manila, as Assistant City
Republic of the Philippines Treasurer. In a 1st endorsement dated February 14, 1969,
SUPREME COURT respondent Abelardo Subido, Commissioner of Civil Service
Manila disapproved the appointment of Lapid, basing his action, on an
opinion of the Secretary of Justice dated September 19, 1968 to
EN BANC the effect that the appointment of Assistant Provincial Treasurers
is still governed by Section 2088 (A) of the Revised
Administrative Code, and not by Section 4 of the Decentralization
Law, Republic Act No. 5185."5

G.R. No. L-31711 September 30, 1971

Thereafter on February 25, 1969, to quote anew from the
appealed decision: "Mayor Villegas and Manuel D. Lapid filed the
ANTONIO J. VILLEGAS as Mayor of the City of Manila and instant petition for prohibition, quo warranto and mandamus, with
MANUEL D. LAPID, petitioners-appellants, application for writ of preliminary injunction, praying that
vs. judgment be rendered to declare illegal and void ab initio the
ABELARDO SUBIDO as Civil Service Commissioner, authorization given by respondent Romualdez to respondent
EDUARDO Z. ROMUALDEZ as Secretary of Finance, JOSE R. Gloria to assume the duties of assistant city treasurer of Manila,
GLORIA as Acting Asst. City Treasurer of Manila, and HON. and that a writ of mandamus be issued to respondent
CONRADO M. VASQUEZ as Presiding Judge of Branch V, Commissioner of Civil Service Subido commanding him to
Court of First Instance of Manila, respondents-appellees. approve the appointment of petitioner Lapid to the said office in
accordance with the civil Service Rules."6 It was not until the filing
Gregorio A. Ejercito and Restituto R. Villanueva for petitioners- of the petition that respondent Jose R. Gloria was nominated by
appellants. the President of the Philippines to the position of Assistant City
treasurer of Manila and thereafter duly confirmed. After the case
was submitted for judgment on the pleadings and the
Office of the Solicitor General Felix Q. Antonio, Acting Assistant
documentary exhibits stipulated by the parties, the court
Solicitor General Hector C. Fule and Solicitor Santiago M.
rendered its decision on August 4, 1969 dismissing the petition.
Kapunan for respondents-appellees.
Hence this appeal by way of certiorari.

With this Tribunal, as with the court below, the decisive question
is the applicable law. The Charter of the City of Manila, enacted
FERNANDO, J.: in 1949, in express terms did confer on the President of the
Philippines, with the consent of the Commission on used in the latter statute must be such as to render it
Appointments, the power to appoint the Assistant City irreconcilable with what had been formerly enacted. An
Treasurer.7 On the other hand, support for the petition is inconsistency that falls short of that standard does not suffice.
premised on the expansive interpretation that would be accorded What is needed is a manifest indication of the legislative purpose
the general provisions found in the Decentralization Act of 1967 to repeal. 15
to the effect that it is a city mayor who has the power to appoint
all other employees paid out of city or local funds subject to civil More specifically, a subsequent statute, general in character as
service law, rules and regulations.8 to its terms and application, is not to be construed as repealing a
special or specific enactment, unless the legislative purpose to
It is understandable why the choice for the lower court was not do so is manifest. This is so even if the provisions of the latter are
difficult to make. What has been so clearly ordained in the sufficiently comprehensive to include what was set forth in the
Charter is controlling. It survives in the face of the assertion that special act. This principle has likewise been consistently applied
the additional power granted local officials to appoint employees in decisions of this Court from Manila Railroad Co. v.
paid out of local funds would suffice to transfer such authority to Rafferty,16decided as far back as 1919. A citation from an opinion
petitioner Mayor. A perusal of the words of the statute, even if far of Justice Tuason is illuminating. Thus: "From another angle the
from searching would not justify such an interpretation. This is all presumption against repeal is stronger. A special law is not
more evident, considering the fidelity manifested by this Court to regarded as having been amended or repealed by a general law
the doctrine that looks with less than favor on implied appeals. unless the intent to repeal or alter is manifest. Generalia
The decision now on appeal, to repeat, must be affirmed. specialibus non derogant. And this is true although the terms of
the general act are broad enough to include the matter in the
1. The inherent weakness of the contention of petitioner Mayor special statute. ... At any rate, in the event harmony between
that would seize upon the vesting of the appointing power of all provisions of this type in the same law or in two laws is
other "employees" except teachers paid out of local funds to impossible, the specific provision controls unless the statute,
justify his choice of petitioner Manuel D. Lapid as Assistant City considered in its entirety, indicates a contrary intention upon the
Treasurer is readily disclosed. The Revised Administrative Code part of the legislature. ... A general law is one which embraces a
distinguishes one in that category from an "officer" to designate class of subjects or places and does not omit any subject or
those "whose duties, not being of a clerical or manual nature, place naturally belonging to such class while a special act is one
may be considered to involve the exercise of discretion in the which relates to particular persons or things of a class. 17
performance of the function of government, whether such duties
are precisely defined by law or not."9 Clearly, the Assistant and WHEREFORE, the lower court decision of August 4, 1969 is
City Treasurer is an officer, not an employee. Then, too, Section affirmed. Without pronouncement as to costs.
4 of the Decentralization Act relied upon by petitioner City Mayor
specifically enumerates, the officials and their assistants whom
he can appoint, specifically excluding therefrom city
treasurers.10 The expansive interpretation contended for is thus
unwarranted.

Nor is the case strengthened for petitioner City Mayor by the

invocation of Pineda v. Claudio.11 It is not to be denied that in the
opinion of the Court, penned by Justice Castro, undue Republic of the Philippines
interference with the power and prerogatives of a local executive SUPREME COURT
is sought to be avoided, considering his primary responsibility for Manila
efficient governmental administration. What is not to be ignored
though is that such a principle was announced in connection with EN BANC
the appointment of a department head, the chief of police, who
necessarily must enjoy the fullest confidence of the local G.R. No. 79974 December 17, 1987
executive, one moreover whose appointment is expressly vested
in the city mayor. The principle therein announced does not
extend as far as the choice of an assistant city treasurer whose ULPIANO P. SARMIENTO III AND JUANITO G.
functions do not require that much degree of confidence, not to ARCILLA, petitioners,
mention the specific grant of such authority to the President. vs.
Equally unavailing then is Villegas v. Subido,12 where this Court, SALVADOR MISON, in his capacity as COMMISSIONER OF
through the then Justice Capistrano, recognized that the choice THE BUREAU OF CUSTOMS, AND GUILLERMO CARAGUE,
of who the city legal officer should be rests solely on the city in his capacity as SECRETARY OF THE DEPARTMENT OF
mayor, such an office requiring as it does the highest degree of BUDGET, respondents, COMMISSION ON
confidence. It bears repeating that the situation in the case APPOINTMENTS, intervenor.
before us is of a different category. The decision appealed from,
then, is not to be impugned as a failure to abide by controlling
pronouncements of this Tribunal.
PADILLA, J.:
2. Much less is reversal of the lower court decision justified on
the plea that the aforesaid provision in the Decentralization Act Once more the Court is called upon to delineate constitutional
had the effect of repealing what is specifically ordained in the city boundaries. In this petition for prohibition, the petitioners, who
charter. It has been the constant holding of this Court that are taxpayers, lawyers, members of the Integrated Bar of the
repeals by duplication are not favored and will not be so declared Philippines and professors of Constitutional Law, seek to enjoin
unless it be manifest that the legislature so intended. Such a the respondent Salvador Mison from performing the functions of
doctrine goes as far back as United States v. Reyes, a 1908 the Office of Commissioner of the Bureau of Customs and the
decision.13 It is necessary then before such a repeal is deemed to respondent Guillermo Carague, as Secretary of the Department
exist that it be shown that the statutes or statutory provisions of Budget, from effecting disbursements in payment of Mison's
deal with the same subject matter and that the latter be salaries and emoluments, on the ground that Mison's
inconsistent with the former.14 There must be a showing of appointment as Commissioner of the Bureau of Customs is
repugnancy clear and convincing in character. The language unconstitutional by reason of its not having been confirmed by
the Commission on Appointments. The respondents, on the other First, the heads of the executive departments,
hand, maintain the constitutionality of respondent Mison's ambassadors, other public ministers and consuls,
appointment without the confirmation of the Commission on officers of the armed forces from the rank of colonel or
Appointments. naval captain, and other officers whose appointments
are vested in him in this Constitution; 2
Because of the demands of public interest, including the need for
stability in the public service, the Court resolved to give due Second, all other officers of the Government whose
course to the petition and decide, setting aside the finer appointments are not otherwise provided for by law; 3
procedural questions of whether prohibition is the proper remedy
to test respondent Mison's right to the Office of Commissioner of Third, those whom the President may be authorized by
the Bureau of Customs and of whether the petitioners have a law to appoint;
standing to bring this suit.
Fourth, officers lower in rank 4 whose appointments the
By the same token, and for the same purpose, the Court allowed Congress may by law vest in the President alone.
the Commission on Appointments to intervene and file a petition
in intervention. Comment was required of respondents on said
petition. The comment was filed, followed by intervenor's reply The first group of officers is clearly appointed with the consent of
thereto. The parties were also heard in oral argument on 8 the Commission on Appointments. Appointments of such officers
December 1987. are initiated by nomination and, if the nomination is confirmed by
the Commission on Appointments, the President appoints. 5
This case assumes added significance because, at bottom line, it
involves a conflict between two (2) great departments of The second, third and fourth groups of officers are the present
government, the Executive and Legislative Departments. It also bone of contention. Should they be appointed by the President
occurs early in the life of the 1987 Constitution. with or without the consent (confirmation) of the Commission on
Appointments? By following the accepted rule in constitutional
and statutory construction that an express enumeration of
The task of the Court is rendered lighter by the existence of subjects excludes others not enumerated, it would follow that
relatively clear provisions in the Constitution. In cases like this, only those appointments to positions expressly stated in the first
we follow what the Court, speaking through Mr. Justice (later, group require the consent (confirmation) of the Commission on
Chief Justice) Jose Abad Santos stated in Gold Creek Mining Appointments. But we need not rely solely on this basic rule of
Corp. vs. Rodriguez, 1 that: constitutional construction. We can refer to historical background
as well as to the records of the 1986 Constitutional Commission
The fundamental principle of constitutional construction to determine, with more accuracy, if not precision, the intention of
is to give effect to the intent of the framers of the organic the framers of the 1987 Constitution and the people adopting it,
law and of the people adopting it. The intention to which on whether the appointments by the President, under the
force is to be given is that which is embodied and second, third and fourth groups, require the consent
expressed in the constitutional provisions themselves. (confirmation) of the Commission on Appointments. Again, in this
task, the following advice of Mr. Chief Justice J. Abad Santos in
The Court will thus construe the applicable constitutional Gold Creek is apropos:
provisions, not in accordance with how the executive or the
legislative department may want them construed, but in In deciding this point, it should be borne in mind that a
accordance with what they say and provide. constitutional provision must be presumed to have been
framed and adopted in the light and understanding of
Section 16, Article VII of the 1987 Constitution says: prior and existing laws and with reference to them.
"Courts are bound to presume that the people adopting
a constitution are familiar with the previous and existing
The President shall nominate and, with the consent of laws upon the subjects to which its provisions relate,
the Commission on Appointments, appoint the heads of and upon which they express their judgment and
the executive departments, ambassadors, other public opinion in its adoption." (Barry vs. Truax 13 N.D., 131;
ministers and consuls, or officers of the armed forces 99 N.W., 769,65 L. R. A., 762.) 6
from the rank of colonel or naval captain, and other
officers whose appointments are vested in him in this
Constitution. He shall also appoint all other officers of It will be recalled that, under Sec. 10, Article VII of the 1935
the Government whose appointments are not otherwise Constitution, it is provided that —
provided for by law, and those whom he may be
authorized by law to appoint. The Congress may, by xxx xxx xxx
law, vest the appointment of other officers lower in rank
in the President alone, in the courts, or in the heads of (3) The President shall nominate and with the consent
the departments, agencies, commissions or boards. of the Commission on Appointments, shall appoint the
heads of the executive departments and bureaus,
The President shall have the power to make officers of the army from the rank of colonel, of the Navy
appointments during the recess of the Congress, and Air Forces from the rank of captain or commander,
whether voluntary or compulsory, but such and all other officers of the Government whose
appointments shall be effective only until disapproval by appointments are not herein otherwise provided for, and
the Commission on Appointments or until the next those whom he may be authorized by law to appoint;
adjournment of the Congress. but the Congress may by law vest the appointment of
inferior officers, in the President alone, in the courts, or
It is readily apparent that under the provisions of the 1987 in the heads of departments.
Constitution, just quoted, there are four (4) groups of officers
whom the President shall appoint. These four (4) groups, to (4) The President shall havethe power to make
which we will hereafter refer from time to time, are: appointments during the recess of the Congress, but
such appointments shall be effective only until
 disapproval by the Commission on Appointments or until appointments more limited than that held by the Commission in
the next adjournment of the Congress. the 1935 Constitution. Thus-

xxx xxx xxx Mr. Rama: ... May I ask that Commissioner
Monsod be recognized
(7) ..., and with the consent of the Commission on
Appointments, shall appoint ambassadors, other public The President: We will call Commissioner
ministers and consuls ... Davide later.

Upon the other hand, the 1973 Constitution provides that- Mr. Monsod: With the Chair's indulgence, I just
want to take a few minutes of our time to lay
Section 10. The President shall appoint the heads of the basis for some of the amendments that I
bureaus and offices, the officers of the Armed Forces of would like to propose to the Committee this
the Philippines from the rank of Brigadier General or morning.
Commodore, and all other officers of The government
whose appointments are not herein otherwise provided xxx xxx xxx
for, and those whom he may be authorized by law to
appoint. However, the Batasang Pambansa may by law On Section 16, I would like to suggest that the power of
vest in the Prime Minister, members of the Cabinet, the the Commission on Appointments be limited to the
Executive Committee, Courts, Heads of Agencies, department heads, ambassadors, generals and so on
Commissions, and Boards the power to appoint inferior but not to the levels of bureau heads and colonels.
officers in their respective offices.
xxx xxx xxx 8 (Emphasis supplied.)
Thus, in the 1935 Constitution, almost all presidential
appointments required the consent (confirmation) of the
Commission on Appointments. It is now a sad part of our political In the course of the debates on the text of Section 16, there were
history that the power of confirmation by the Commission on two (2) major changes proposed and approved by the
Appointments, under the 1935 Constitution, transformed that Commission. These were (1) the exclusion of the appointments
commission, many times, into a venue of "horse-trading" and of heads of bureaus from the requirement of confirmation by the
similar malpractices. Commission on Appointments; and (2) the exclusion of
appointments made under the second sentence 9 of the section
from the same requirement. The records of the deliberations of
On the other hand, the 1973 Constitution, consistent with the the Constitutional Commission show the following:
authoritarian pattern in which it was molded and remolded by
successive amendments, placed the absolute power of
appointment in the President with hardly any check on the part of MR. ROMULO: I ask that Commissioner Foz
the legislature. be recognized

Given the above two (2) extremes, one, in the 1935 Constitution THE PRESIDENT: Commissioner Foz is
and the other, in the 1973 Constitution, it is not difficult for the recognized
Court to state that the framers of the 1987 Constitution and the
people adopting it, struck a "middle ground" by requiring the MR. FOZ: Madam President, my proposed
consent (confirmation) of the Commission on Appointments for amendment is on page 7, Section 16, line 26
the first group of appointments and leaving to the President, which is to delete the words "and bureaus,"
without such confirmation, the appointment of other officers, i.e., and on line 28 of the same page, to change the
those in the second and third groups as well as those in the phrase 'colonel or naval captain to MAJOR
fourth group, i.e., officers of lower rank. GENERAL OR REAR ADMIRAL. This last
amendment which is co-authored by
The proceedings in the 1986 Constitutional Commission support Commissioner de Castro is to put a period (.)
this conclusion. The original text of Section 16, Article VII, as after the word ADMIRAL, and on line 29 of the
proposed by the Committee on the Executive of the 1986 same page, start a new sentence with: HE
Constitutional Commission, read as follows: SHALL ALSO APPOINT, et cetera.

Section 16. The president shall nominate and, with the MR. REGALADO: May we have the
consent of a Commission on Appointment, shall appoint amendments one by one. The first proposed
the heads of the executive departments and bureaus, amendment is to delete the words "and
ambassadors, other public ministers and consuls, or bureaus" on line 26.
officers of the armed forces from the rank of colonel or
naval captain and all other officers of the Government MR. FOZ: That is correct.
whose appointments are not otherwise provided for by
law, and those whom he may be authorized by law to MR. REGALADO: For the benefit of the other
appoint. The Congress may by law vest the appointment Commissioners, what would be the justification
of inferior officers in the President alone, in the courts, of the proponent for such a deletion?
or in the heads of departments 7 [Emphasis supplied].

MR. FOZ: The position of bureau director is

The above text is almost a verbatim copy of its counterpart actually quite low in the executive department,
provision in the 1935 Constitution. When the frames discussed and to require further confirmation of
on the floor of the Commission the proposed text of Section 16, presidential appointment of heads of bureaus
Article VII, a feeling was manifestly expressed to make the power would subject them to political influence.
of the Commission on Appointments over presidential
 MR. REGALADO: The Commissioner's THE PRESIDENT: Commissioner Foz is
proposed amendment by deletion also includes recognized
regional directors as distinguished from merely
staff directors, because the regional directors MR. FOZ: Madam President, this is the third
have quite a plenitude of powers within the proposed amendment on page 7, line 28. 1
regions as distinguished from staff directors propose to put a period (.) after 'captain' and
who only stay in the office. on line 29, delete 'and all' and substitute it with
HE SHALL ALSO APPOINT ANY.
MR. FOZ: Yes, but the regional directors are
under the supervisiopn of the staff bureau MR. REGALADO: Madam President, the
directors. Committee accepts the proposed amendment
because it makes it clear that those other
xxx xxx xxx officers mentioned therein do not have to be
confirmed by the Commission on
MR. MAAMBONG: May I direct a question to Appointments.
Commissioner Foz? The Commissioner
proposed an amendment to delete 'and MR. DAVIDE: Madam President.
bureaus on Section 16. Who will then appoint
the bureau directors if it is not the President? THE PRESIDENT: Commissioner Davide is
recognized.
MR. FOZ: It is still the President who will
appoint them but their appointment shall no xxx xxx xxx
longer be subject to confirmation by the
Commission on Appointments.
MR. DAVIDE: So would the proponent accept
an amendment to his amendment, so that after
MR. MAAMBONG: In other words, it is in line "captain" we insert the following words: AND
with the same answer of Commissioner de OTHER OFFICERS WHOSE
Castro? APPOINTMENTS ARE VESTED IN HIM IN
THIS CONSTITUTION?
MR. FOZ: Yes.
FR. BERNAS: It is a little vague.
MR. MAAMBONG: Thank you.
MR. DAVIDE: In other words, there are
THE PRESIDENT: Is this clear now? What is positions provided for in the Constitution whose
the reaction of the Committee? appointments are vested in the President, as a
matter of fact like those of the different
xxx xxx xxx constitutional commissions.

MR. REGALADO: Madam President, the FR. BERNAS: That is correct. This list of
Committee feels that this matter should be officials found in Section 16 is not an exclusive
submitted to the body for a vote. list of those appointments which
constitutionally require confirmation of the
Commission on Appointments,
MR. DE CASTRO: Thank you.
MR. DAVIDE: That is the reason I seek the
MR. REGALADO: We will take the incorporation of the words I proposed.
amendments one by one. We will first vote on
the deletion of the phrase 'and bureaus on line
26, such that appointments of bureau directors FR. BERNAS: Will Commissioner Davide
no longer need confirmation by the restate his proposed amendment?
Commission on Appointment.
MR. DAVIDE: After 'captain,' add the following:
Section 16, therefore, would read: 'The President shall AND OTHER OFFICERS WHOSE
nominate, and with the consent of a Commission on APPOINTMENTS ARE VESTED IN HIM IN
Appointments, shall appoint the heads of the executive THIS CONSTITUTION.
departments, ambassadors. . . .
FR. BERNAS: How about:"AND OTHER
THE PRESIDENT: Is there any objection to OFFICERS WHOSE APPOINTMENTS
delete the phrase 'and bureaus' on page 7, line REQUIRE CONFIRMATION UNDER THIS
26? (Silence) The Chair hears none; the CONSTITUTION"?
amendments is approved.
MR. DAVIDE: Yes, Madam President, that is
xxx xxx xxx modified by the Committee.

MR. ROMULO: Madam President. FR. BERNAS: That will clarify things.

THE PRESIDENT: The Acting Floor Leader is THE PRESIDENT: Does the Committee
recognized. accept?
 MR. REGALADO: Just for the record, of Constitutional Commission clearly and expressly justify such
course, that excludes those officers which the differences.
Constitution does not require confirmation by
the Commission on Appointments, like the As a result of the innovations introduced in Sec. 16, Article VII of
members of the judiciary and the Ombudsman. the 1987 Constitution, there are officers whose appointments
require no confirmation of the Commission on Appointments,
MR. DAVIDE: That is correct. That is very clear even if such officers may be higher in rank, compared to some
from the modification made by Commissioner officers whose appointments have to be confirmed by the
Bernas. Commission on Appointments under the first sentence of the
same Sec. 16, Art. VII. Thus, to illustrate, the appointment of the
THE PRESIDENT: So we have now this Central Bank Governor requires no confirmation by the
proposed amendment of Commissioners Foz Commission on Appointments, even if he is higher in rank than a
and Davide. colonel in the Armed Forces of the Philippines or a consul in the
Consular Service.
xxx xxx xxx
But these contrasts, while initially impressive, merely underscore
the purposive intention and deliberate judgment of the framers of
THE PRESIDENT: Is there any objection to this the 1987 Constitution that, except as to those officers whose
proposed amendment of Commissioners Foz appointments require the consent of the Commission on
and Davide as accepted by the Committee? Appointments by express mandate of the first sentence in Sec.
(Silence) The Chair hears none; the 16, Art. VII, appointments of other officers are left to the
amendment, as amended, is President without need of confirmation by the Commission on
approved 10 (Emphasis supplied). Appointments. This conclusion is inevitable, if we are to presume,
as we must, that the framers of the 1987 Constitution were
It is, therefore, clear that appointments to the second knowledgeable of what they were doing and of the foreseable
and third groups of officers can be made by the effects thereof.
President without the consent (confirmation) of the
Commission on Appointments. Besides, the power to appoint is fundamentally executive or
presidential in character. Limitations on or qualifications of such
It is contended by amicus curiae, Senator Neptali power should be strictly construed against them. Such limitations
Gonzales, that the second sentence of Sec. 16, Article or qualifications must be clearly stated in order to be recognized.
VII reading- But, it is only in the first sentence of Sec. 16, Art. VII where it is
clearly stated that appointments by the President to the positions
He (the President) shall also appoint all other officers of therein enumerated require the consent of the Commission on
the Government whose appointments are not otherwise Appointments.
provided for by law and those whom he may be
authorized by law to appoint . . . . (Emphasis supplied) As to the fourth group of officers whom the President can
appoint, the intervenor Commission on Appointments
with particular reference to the word "also," implies that the underscores the third sentence in Sec. 16, Article VII of the 1987
President shall "in like manner" appoint the officers mentioned in Constitution, which reads:
said second sentence. In other words, the President shall appoint
the officers mentioned in said second sentence in the same The Congress may, by law, vest the appointment of
manner as he appoints officers mentioned in the first sentence, other officers lower in rank in the President alone, in the
that is, by nomination and with the consent (confirmation) of the courts, or in the heads of departments, agencies,
Commission on Appointments. commissions, or boards. [Emphasis supplied].

Amicus curiae's reliance on the word "also" in said second and argues that, since a law is needed to vest the appointment of
sentence is not necessarily supportive of the conclusion he lower-ranked officers in the President alone, this implies that, in
arrives at. For, as the Solicitor General argues, the word "also" the absence of such a law, lower-ranked officers have to be
could mean "in addition; as well; besides, too" (Webster's appointed by the President subject to confirmation by the
International Dictionary, p. 62, 1981 edition) which meanings Commission on Appointments; and, if this is so, as to lower-
could, on the contrary, stress that the word "also" in said second ranked officers, it follows that higher-ranked officers should be
sentence means that the President, in addition to nominating appointed by the President, subject also to confirmation by the
and, with the consent of the Commission on Appointments, Commission on Appointments.
appointing the officers enumerated in the first sentence, can
appoint (without such consent (confirmation) the officers The respondents, on the other hand, submit that the third
mentioned in the second sentence- sentence of Sec. 16, Article VII, abovequoted, merely declares
that, as to lower-ranked officers, the Congress may by law vest
Rather than limit the area of consideration to the possible their appointment in the President, in the courts, or in the heads
meanings of the word "also" as used in the context of said of the various departments, agencies, commissions, or boards in
second sentence, the Court has chosen to derive significance the government. No reason however is submitted for the use of
from the fact that the first sentence speaks of nomination by the the word "alone" in said third sentence.
President and appointment by the President with the consent of
the Commission on Appointments, whereas, the second The Court is not impressed by both arguments. It is of the
sentence speaks only of appointment by the President. And, this considered opinion, after a careful study of the deliberations of
use of different language in two (2) sentences proximate to each the 1986 Constitutional Commission, that the use of the word
other underscores a difference in message conveyed and alone" after the word "President" in said third sentence of Sec.
perceptions established, in line with Judge Learned Hand's 16, Article VII is, more than anything else, a slip or lapsus in
observation that "words are not pebbles in alien juxtaposition" draftmanship. It will be recalled that, in the 1935 Constitution, the
but, more so, because the recorded proceedings of the 1986 following provision appears at the end of par. 3, section 1 0,
Article VII thereof —
 ...; but the Congress may by law vest the appointment of and Customs Code of the Philippines, which was enacted by the
inferior officers, in the President alone, in the courts, or Congress of the Philippines on 22 June 1957, reads as follows:
in the heads of departments. [Emphasis supplied].
601. Chief Officials of the Bureau.-The Bureau of
The above provision in the 1935 Constitution appears Customs shall have one chief and one assistant chief, to
immediately after the provision which makes practically all be known respectively as the Commissioner (hereinafter
presidential appointments subject to confirmation by the known as the 'Commissioner') and Assistant
Commission on Appointments, thus- Commissioner of Customs, who shall each receive an
annual compensation in accordance with the rates
3. The President shall nominate and with the consent of prescribed by existing laws. The Assistant
the Commission on Appointments, shall appoint the Commissioner of Customs shall be appointed by the
heads of the executive departments and bureaus, proper department head.
officers of the Army from the rank of colonel, of the Navy
and Air Forces from the rank of captain or commander, Sec. 601 of Republic Act No. 1937, was amended on 27 October
and all other officers of the Government whose 1972 by Presidential Decree No. 34, amending the Tariff and
appointments are not herein provided for, and those Customs Code of the Philippines. Sec. 601, as thus amended,
whom he may be authorized by law to appoint; ... now reads as follows:

In other words, since the 1935 Constitution subjects, as a Sec. 601. Chief Officials of the Bureau of Customs.-The
general rule, presidential appointments to confirmation by the Bureau of Customs shall have one chief and one
Commission on Appointments, the same 1935 Constitution saw assistant chief, to be known respectively as the
fit, by way of an exception to such rule, to provide that Congress Commissioner (hereinafter known as Commissioner)
may, however, by law vest the appointment of inferior officers and Deputy Commissioner of Customs, who shall each
(equivalent to 11 officers lower in rank" referred to in the 1987 receive an annual compensation in accordance with the
Constitution) in the President alone, in the courts, or in the heads rates prescribed by existing law. The Commissioner and
of departments, the Deputy Commissioner of Customs shall be
appointed by the President of the Philippines (Emphasis
In the 1987 Constitution, however, as already pointed out, the supplied.)
clear and expressed intent of its framers was to exclude
presidential appointments from confirmation by the Commission Of course, these laws (Rep. Act No. 1937 and PD No. 34) were
on Appointments, except appointments to offices expressly approved during the effectivity of the 1935 Constitution, under
mentioned in the first sentence of Sec. 16, Article VII. which the President may nominate and, with the consent of the
Consequently, there was no reason to use in the third sentence Commission on Appointments, appoint the heads of bureaus, like
of Sec. 16, Article VII the word "alone" after the word "President" the Commissioner of the Bureau of Customs.
in providing that Congress may by law vest the appointment of
lower-ranked officers in the President alone, or in the courts, or in After the effectivity of the 1987 Constitution, however, Rep. Act
the heads of departments, because the power to appoint officers No. 1937 and PD No. 34 have to be read in harmony with Sec.
whom he (the President) may be authorized by law to appoint is 16, Art. VII, with the result that, while the appointment of the
already vested in the President, without need of confirmation by Commissioner of the Bureau of Customs is one that devolves on
the Commission on Appointments, in the second sentence of the the President, as an appointment he is authorizedby law to make,
same Sec. 16, Article VII. such appointment, however, no longer needs the confirmation of
the Commission on Appointments.
Therefore, the third sentence of Sec. 16, Article VII could have
stated merely that, in the case of lower-ranked officers, the Consequently, we rule that the President of the Philippines acted
Congress may by law vest their appointment in the President, in within her constitutional authority and power in appointing
the courts, or in the heads of various departments of the respondent Salvador Mison, Commissioner of the Bureau of
government. In short, the word "alone" in the third sentence of Customs, without submitting his nomination to the Commission
Sec. 16, Article VII of the 1987 Constitution, as a literal import on Appointments for confirmation. He is thus entitled to exercise
from the last part of par. 3, section 10, Article VII of the 1935 the full authority and functions of the office and to receive all the
Constitution, appears to be redundant in the light of the second salaries and emoluments pertaining thereto.
sentence of Sec. 16, Article VII. And, this redundancy cannot
prevail over the clear and positive intent of the framers of the
1987 Constitution that presidential appointments, except those WHEREFORE, the petition and petition in intervention should be,
mentioned in the first sentence of Sec. 16, Article VII, are not as they are, hereby DISMISSED. Without costs.
subject to confirmation by the Commission on Appointments.
SO ORDERED.
Coming now to the immediate question before the Court, it is
evident that the position of Commissioner of the Bureau of
Customs (a bureau head) is not one of those within the first
group of appointments where the consent of the Commission on
Appointments is required. As a matter of fact, as already pointed
out, while the 1935 Constitution includes "heads of bureaus"
among those officers whose appointments need the consent of
the Commission on Appointments, the 1987 Constitution on the
other hand, deliberately excluded the position of "heads of Republic of the Philippines
bureaus" from appointments that need the consent (confirmation) SUPREME COURT
of the Commission on Appointments. Manila

Moreover, the President is expressly authorized by law to appoint EN BANC

the Commissioner of the Bureau of Customs. The original text of
Sec. 601 of Republic Act No. 1937, otherwise known as the Tariff G.R. No. L-2348 February 27, 1950
GREGORIO PERFECTO, plaintiff-appellee, the earlier and much criticized case of Northumberland
vs. county v. Chapman (1829) 2 Rawle (Pa.) 73]*
BIBIANO MEER, Collector of Internal Revenue, defendant-
appellant. A different rule prevails in Wisconsin, according to the same
annotation. Another state holding the contrary view is Missouri.
First Assistant Solicitor General Roberto A. Gianzon and Solicitor
Francisco Carreon for oppositor and appellant. The Constitution of the United States, likes ours, forbids the
Gregorio Perfecto in his own behalf. diminution of the compensation of Judges of the Supreme Court
and of inferior courts. The Federal Governments has an income
BENGZON, J.: tax law. Does it embrace the salaries of federal judges? In
answering this question, we should consider four periods:
In April, 1947 the Collector of Internal Revenue required Mr.
Justice Gregorio Perfecto to pay income tax upon his salary as First period. No attempts was made to tax the compensation of
member of this Court during the year 1946. After paying the Federal judges up to 1862 1.
amount (P802), he instituted this action in the Manila Court of
First Instance contending that the assessment was illegal, his Second period. 1862-1918. In July, 1862, a statute was passed
salary not being taxable for the reason that imposition of taxes subjecting the salaries of "civil officers of the United States" to an
thereon would reduce it in violation of the Constitution. income tax of three per cent. Revenue officers, construed it as
including the compensation of all judges; but Chief Justice Taney,
The Manila judge upheld his contention, and required the refund speaking for the judiciary, wrote to the Secretary of the Treasury
of the amount collected. The defendant appealed. a letter of protest saying, among other things:

The death of Mr. Justice Perfecto has freed us from the The act in question, as you interpret it, diminishes the
embarrassment of passing upon the claim of a colleague. Still, as compensation of every judge 3 per cent, and if it can be
the outcome indirectly affects all the members of the Court, diminished to that extent by the name of a tax, it may, in
consideration of the matter is not without its vexing feature. Yet the same way, be reduced from time to time, at the
adjudication may not be declined, because (a) we are not legally pleasure of the legislature.
disqualified; (b) jurisdiction may not be renounced, ad it is the
defendant who appeals to this Court, and there is no other The judiciary is one of the three great departments of
tribunal to which the controversy may be referred; (c) supreme the government, created and established by the
courts in the United States have decided similar disputes relating Constitution. Its duties and powers are specifically set
to themselves; (d) the question touches all the members of the forth, and are of a character that requires it to be
judiciary from top to bottom; and (e) the issue involves the right perfectly independent of the two other departments, and
of other constitutional officers whose compensation is equally in order to place it beyond the reach and above even
protected by the Constitution, for instance, the President, the the suspicion of any such influence, the power to reduce
Auditor-General and the members of the Commission on their compensation is expressly withheld from
Elections. Anyway the subject has been thoroughly discussed in Congress, and excepted from their powers of legislation.
many American lawsuits and opinions, and we shall hardly do
nothing more than to borrow therefrom and to compare their
conclusions to local conditions. There shall be little occasion to Language could not be more plain than that used in the
formulate new propositions, for the situation is not Constitution. It is, moreover, one of its most important
unprecedented. and essential provisions. For the articles which limits the
powers of the legislative and executive branches of the
government, and those which provide safeguards for the
Our Constitution provides in its Article VIII, section 9, that the protection of the citizen in his person and property,
members of the Supreme Court and all judges of inferior courts would be of little value without a judiciary to uphold and
"shall receive such compensation as may be fixed by law, which maintain them, which was free from every influence,
shall not be diminished during their continuance in office." It also direct and indirect, that might by possibility in times of
provides that "until Congress shall provide otherwise, the Chief political excitement warp their judgments.
Justice of the Supreme Court shall receive an annual
compensation of sixteen thousand pesos". When in 1945 Mr.
Justice Perfecto assumed office, Congress had not "provided Upon these grounds I regard an act of Congress
otherwise", by fixing a different salary for associate justices. He retaining in the Treasury a portion of the Compensation
received salary at the rate provided by the Constitution, i.e., of the judges, as unconstitutional and void2.
fifteen thousand pesos a year.
The protest was unheeded, although it apparently bore the
Now, does the imposition of an income tax upon this salary in approval of the whole Supreme Court, that ordered it printed
1946 amount to a diminution thereof?. among its records. But in 1869 Attorney-General Hoar upon the
request of the Secretary of the Treasury rendered an opinion
agreeing with the Chief Justice. The collection of the tax was
A note found at page 534 of volume 11 of the American Law consequently discontinued and the amounts theretofore received
Reports answers the question in the affirmative. It says: were all refunded. For half a century thereafter judges' salaries
were not taxed as income.3
Where the Constitution of a state provides that the
salaries of its judicial officers shall not be dismissed Third period. 1919-1938. The Federal Income Tax Act of
during their continuance in office, it had been held that February 24, 1919 expressly provided that taxable income shall
the state legislature cannot impose a tax upon the include "the compensation of the judges of the Supreme Court
compensation paid to the judges of its court. New and inferior courts of the United States". Under such Act, Walter
Orleans v. Lea (1859) 14 La. Ann. 194; Opinion of Evans, United States judge since 1899, paid income tax on his
Attorney-General if N. C. (1856) 48 N. C. (3 Jones, L.) salary; and maintaining that the impost reduced his
Appx. 1; Re Taxation of Salaries of Judges (1902) 131 compensation, he sued to recover the money he had delivered
N. C. 692, 42 S. E. 970; Com. ex. rel. Hepburn v. Mann under protest. He was upheld in 1920 by the Supreme Court in
(1843) 5 Watts & S,. (Pa.) 403 [but see to the contrary
an epoch-making decision.*, explaining the purpose, history and governmental prerogative. It is in this sense that our
meaning of the Constitutional provision forbidding impairment of judiciary is the balance wheel of our entire system; it is
judicial salaries and the effect of an income tax upon the salary of meant to maintain that nice adjustment between
a judge. individual rights and governmental powers which
constitutes political liberty. Constitutional government in
With what purpose does the Constitution provide that the United States, pp. 17, 142.
the compensation of the judges "shall not be diminished
during their continuance in office"? Is it primarily to Conscious in the nature and scope of the power being
benefit the judges, or rather to promote the public weal vested in the national courts, recognizing that they
by giving them that independence which makes for an would be charge with responsibilities more delicate and
impartial and courageous discharge of the judicial important than any ever before confide to judicial
function? Does the provision merely forbid direct tribunals, and appreciating that they were to be, in the
diminution, such as expressly reducing the words of George Washington, "the keystone of our
compensation from a greater to a less sum per year, political fabric", the convention with unusual accord
and thereby leave the way open for indirect, yet incorporated in the Constitution the provision that the
effective, diminution, such as withholding or calling back judges "shall hold their offices during good behavior,
a part as tax on the whole? Or does it mean that the and shall at stated times receive for their services a
judge shall have a sure and continuing right to the compensation which shall not be diminished during their
compensation, whereon he confidently may rely for his continuance in office." Can there be any doubt that the
support during his continuance in office, so that he need two things thus coupled in place — the clause in respect
have no apprehension lest his situation in this regard of tenure during good behaviour and that in respect of
may be changed to his disadvantage? an undiminishable compensation-were equally coupled
in purpose? And is it not plain that their purposes was to
The Constitution was framed on the fundamental theory invest the judges with an independence in keeping with
that a larger measure of liberty and justice would be the delicacy and importance of their task, and with the
assured by vesting the three powers — the legislative, imperative need for its impartial and fearless
the executive, and the judicial — in separate performance? Mr. Hamilton said in explanation and
departments, each relatively independent of the others support of the provision (Federalist No. 79): "Next to
and it was recognized that without this independence — permanency in office, nothing can contribute more to the
if it was not made both real and enduring — the independence of the judges than a fixed provision for
separation would fail of its purpose. all agreed that their support. . . . In the general course of human
restraints and checks must be imposed to secure the nature, a power over a man's subsistence amounts to a
requisite measure of independence; for otherwise the power over his will.
legislative department, inherently the strongest, might
encroach on or even come to dominate the others, and xxx xxx xxx
the judicial, naturally the weakest, might be dwarf or
swayed by the other two, especially by the legislative. These considerations make it very plain, as we think,
that the primary purpose of the prohibition against
The particular need for making the judiciary diminution was not to benefit the judges, but, like the
independent was elaborately pointed our by Alexander clause in respect of tenure, to attract good and
Hamilton in the Federalist, No. 78, from which we competent men to the bench, and to promote that
excerpt the following: independence of action and judgment which is essential
to the maintenance of the guaranties, limitations, and
xxx xxx xxx pervading principles of the constitution, and to the
admiration of justice without respect to persons, and
with equal concern for the poor and the rich.
At a later period John Marshall, whose rich experience
as lawyer, legislator, and chief justice enable him to
speak as no one else could, tersely said (debates Va. xxx xxx xxx
Gonv. 1829-1831, pp. 616, 619): . . . Our courts are the
balance wheel of our whole constitutional system; and But it is urged that what plaintiff was made to pay back
our is the only constitutional system so balanced and was an income tax, and that a like tax was exacted of
controlled. Other constitutional systems lacks complete others engaged in private employment.
poise and certainly of operation because they lack the
support and interpretation of authoritative, undisputable If the tax in respect of his compensation be prohibited, it
courts of law. It is clear beyond all need of exposition can find no justification in the taxation of other income
that for the definite maintenance of constitutional as to which there is no prohibition, for, of course, doing
understandings it is indispensable, alike for the what the Constitution permits gives no license to do
preservation of the liberty of the individual and for the what it prohibits.
preservation of the integrity of the powers of the
government, that there should be some nonpolitical
forum in which those understandings can be impartially The prohibition is general, contains no excepting words,
debated and determined. That forum our courts supply. and appears to be directed against all diminution,
There the individual may assert his rights; there the whether for one purpose or another; and the reason for
government must accept definition of its authority. There its adoption, as publicly assigned at the time and
the individual may challenge the legality of commonly accepted ever since, make with impelling
governmental action and have it adjudged by the test of force for the conclusion that the fathers of the
fundamental principles, and that test the government Constitution intended to prohibit diminution by taxation
must abide; there the government can check the too as well as otherwise, that they regarded the
aggressive self-assertion of the individual and establish independence of the judges as of far greater importance
its power upon lines which all can comprehend and than any revenue that could come from taxing their
heed. The constitutional powers of the courts constitute salaries. (American law Reports, annotated, Vol. 11, pp.
the ultimate safeguard alike of individual privilege and of 522-25; Evans vs. Gore, supra.)
In September 1, 1919, Samuel J. Graham assumed office as reached that although Congress may validly declare by law that
judge of the Unites States court of claims. His salary was taxed salaries of judges appointed thereafter shall be taxed as income
by virtue of the same time income tax of February 24, 1919. At (O'Malley vs. Woodrough) it may not tax the salaries of those
the time he qualified, a statute fixed his salary at P7,500. He filed judges already in office at the time of such declaration because
action for reimbursement, submitting the same theory on which such taxation would diminish their salaries (Evans vs. Gore;
Evans v. Gore had been decided. The Supreme Court of the Miles vs. Graham). In this manner the rationalizing principle that
United States in 1925 reaffirmed that decision. It overruled the will harmonize the allegedly discordant decision may be
distinction offered by Solicitor-General Beck that Judge Graham condensed.
took office after the income tax had been levied on judicial
salaries, (Evans qualified before), and that Congress had power By the way, Justice Frankfurter, writing the O'Malley decision,
"to impose taxes which should apply to the salaries of Federal says the Evans precedent met with disfavor from legal
judges appointed after the enactment of the taxing statute." (The scholarship opinion. Examining the issues of Harvard Law review
law had made no distinction as to judges appointed before or at the time of Evans vs. Gore (Frankfurter is a Harvard graduate
after its passage) and professor), we found that such school publication criticized it.
Believing this to be the "inarticulate consideration that may have
Fourth period. 1939 — Foiled in their previous attempts, the influenced the grounds on which the case went off"4, we looked
Revenue men persisted, and succeeded in inserting in the United into the criticism, and discovered that it was predicated on the
States Revenue Act of June, 1932 the modified proviso that position that the 16th Amendment empowered Congress "to
"gross income" on which taxes were payable included the collect taxes on incomes from whatever source
compensation "of judges of courts of the United States taking derived" admitting of no exception. Said the Harvard Law
office after June 6, 1932". Joseph W. Woodrough qualified as Journal:
United States circuit judge on May 1, 1933. His salary as judge
was taxed, and before the Supreme Court of the United States In the recent case of Evans vs. Gore the Supreme Court
the issue of decrease of remuneration again came up. That court, of the United States decided that by taxing the salary of
however, ruled against him, declaring (in 1939) that Congress a federal judge as a part of his income, Congress was in
had the power to adopt the law. It said: effect reducing his salary and thus violating Art. III, sec.
1, of the Constitution. Admitting for the present purpose
The question immediately before us is whether that such a tax really is a reduction of salary, even so it
Congress exceeded its constitutional power in providing would seem that the words of the amendment giving
that United States judges appointed after the Revenue power to tax 'incomes, from whatever source derived',
Act of 1932 shall not enjoy immunity from the incidence are sufficiently strong to overrule pro tanto the
of taxation to which everyone else within the defined provisions of Art. III, sec. 1. But, two years ago, the
classes of income is subjected. Thereby, of course, court had already suggested that the amendment in no
Congress has committed itself to the position that a non- way extended the subjects open to federal taxation. The
discriminatory tax laid generally on net income is not, decision in Evans vs. Gore affirms that view, and
when applied to the income of federal judge, a virtually strikes from the amendment the words "from
diminution of his salary within the prohibition of Article 3, whatever source derived". (Harvard law Review, vol. 34,
Sec. 1 of the Constitution. To suggest that it makes p. 70)
inroads upon the independence of judges who took
office after the Congress has thus charged them with The Unites States Court's shift of position5 might be attributed to
the common duties of citizenship, by making them bear the above detraction which, without appearing on the surface, led
their aliquot share of the cost of maintaining the to Frankfurter's sweeping expression about judges being also
Government, is to trivialize the great historic experience citizens liable to income tax. But it must be remembered that
on which the framers based the safeguards of Article 3, undisclosed factor — the 16th Amendment — has no counterpart
Sec. 1. To subject them to a general tax is merely to in the Philippine legal system. Our Constitution does not repeat it.
recognize that judges also are citizens, and that their Wherefore, as the underlying influence and the unuttered reason
particular function in government does not generate an has no validity in this jurisdiction, the broad generality loses much
immunity from sharing with their fellow citizens the of its force.
material burden of the government whose Constitution
and laws they are charged with administering. (O'Malley
vs. Woodrough, 59 S. Ct. 838, A. L. R. 1379.) Anyhow the O'Malley case declares no more than that
Congress may validly enact a law taxing the salaries of judges
appointed after its passage. Here in the Philippines no such law
Now, the case for the defendant-appellant Collector of Internal has been approved.
Revenue is premised mainly on this decision (Note A). He claims
it holds "that federal judges are subject to the payment of income
taxes without violating the constitutional prohibition against the Besides, it is markworthy that, as Judge Woodrough had
reduction of their salaries during their continuance in office", and qualified after the express legislative declaration taxing salaries,
that it "is a complete repudiation of the ratio decidenci of Evans he could not very well complain. The United States Supreme
vs. Gore". To grasp the full import of the O'Malley precedent, we Court probably had in mind what in other cases was maintained,
should bear in mind that: namely, that the tax levied on the salary in effect decreased the
emoluments of the office and therefore the judge qualified with
such reduced emoluments.6
1. It does not entirely overturn Miles vs. Graham. "To the
extent that what the Court now says is inconsistent with what
said in Miles vs. Graham, the latter can not survive", Justice The O'Malley ruling does not cover the situation in which judges
Frankfurter announced. already in office are made to pay tax by executive interpretation,
without express legislative declaration. That state of affairs is
controlled by the administrative and judicial standards herein-
2. It does not expressly touch nor amend the doctrine in Evans before described in the "second period" of the Federal
vs, Gore, although it indicates that the Congressional Act in Government, namely, the views of Chief Justice Taney and of
dispute avoided in part the consequences of that case. Attorney-General Hoar and the constant practice from 1869 to
1938, i.e., when the Income Tax Law merely taxes "income" in
Carefully analyzing the three cases (Evans, Miles and O'Malley) general, it does not include salaries of judges protected from
and piecing them together, the logical conclusion may be diminution.
In this connection the respondent would make capital of the received by the President of the Philippines, members
circumstance that the Act of 1932, upheld in the O'Malley case, of the Judiciary, and the Auditor General during the
has subsequently been amended by making it applicable even to calendar year 1939 and thereafter. . . . . (Emphasis
judges who took office before1932. This shows, the appellant ours.)
argues, that Congress interprets the O'Malley ruling to permit
legislative taxation of the salary of judges whether appointed Of course, the Secretary of Justice correctly opined that the
before the tax or after. The answer to this is that the Federal O'Malley decision "resolved the issue of taxability of judges'
Supreme Court expressly withheld opinion on that amendment in salaries into a question of policy." But that policy must be
the O'Malley case. Which is significant. Anyway, and again, there enunciated by Congressional enactment, as was done in the
is here no congressional directive taxing judges' salaries. O'Malley case, not by Executive Fiat or interpretation.

Wherefore, unless and until our Legislature approves an This is not proclaiming a general tax immunity for men on the
amendment to the Income Tax Law expressly taxing "that bench. These pay taxes. Upon buying gasoline, or other
salaries of judges thereafter appointed", the O'Malley case is not commodities, they pay the corresponding duties. Owning real
relevant. As in the United States during the second period, we property, they pay taxes thereon. And on incomes other than their
must hold that salaries of judges are not included in the word judicial salary, assessments are levied. It is only when the tax is
"income" taxed by the Income Tax Law. Two paramount charged directly on their salary and the effect of the tax is to
circumstances may additionally be indicated, to wit: First, when diminish their official stipend — that the taxation must be resisted
the Income Tax Law was first applied to the Philippines 1913, as an infringement of the fundamental charter.
taxable "income" did not include salaries of judicial officers when
these are protected from diminution. That was the prevailing
official belief in the United States, which must be deemed to have Judges would indeed be hapless guardians of the Constitution if
been transplanted here;7 and second, when the Philippine they did not perceive and block encroachments upon their
Constitutional Convention approved (in 1935) the prohibition prerogatives in whatever form. The undiminishable character of
against diminution off the judges' compensation, the Federal judicial salaries is not a mere privilege of judges — personal and
principle was known that income tax on judicial salaries really therefore waivable — but a basic limitation upon legislative or
impairs them. Evans vs. Gore and Miles vs. Graham were then executive action imposed in the public interest. (Evans vs. Gore)
outstanding doctrines; and the inference is not illogical that in
restraining the impairment of judicial compensation the Fathers Indeed the exemption of the judicial salary from reduction by
of the Constitution intended to preclude taxation of the same.8 taxation is not really a gratuity or privilege. Let the highest court
of Maryland speak:
It seems that prior to the O'Malley decision the Philippine
Government did not collect income tax on salaries of judges. This The exemption of the judicial compensation from
may be gleaned from General Circular No. 449 of the reduction is not in any true sense a gratuity, privilege or
Department of Finance dated March 4, 1940, which says in part: exemption. It is essentially and primarily compensation
based upon valuable consideration. The covenant on
xxx xxx xxx the part of the government is a guaranty whose
fulfillment is as much as part of the consideration
agreed as is the money salary. The undertaking has its
The question of whether or not the salaries of judges own particular value to the citizens in securing the
should be taken into account in computing additional independence of the judiciary in crises; and in the
residence taxes is closely linked with the liability of establishment of the compensation upon a permanent
judges to income tax on their salaries, in fact, whatever foundation whereby judicial preferment may be
resolution is adopted with respect to either of said taxes prudently accepted by those who are qualified by talent,
be followed with respect to the other. The opinion of the knowledge, integrity and capacity, but are not
Supreme Court of the United States in the case possessed of such a private fortune as to make an
of O'Malley v. Woodrough, 59 S. Ct. 838, to which the assured salary an object of personal concern. On the
attention of this department has been drawn, appears to other hand, the members of the judiciary relinquish their
have enunciated a new doctrine regarding the liability of position at the bar, with all its professional emoluments,
judges to income tax upon their salaries. In view of the sever their connection with their clients, and dedicate
fact that the question is of great significance, the matter themselves exclusively to the discharge of the onerous
was taken up in the Council of State, and the duties of their high office. So, it is irrefutable that they
Honorable, the Secretary of Justice was requested to guaranty against a reduction of salary by the imposition
give an opinion on whether or not, having in mind the of a tax is not an exemption from taxation in the sense
said decision of the Supreme Court of the United States of freedom from a burden or service to which others are
in the case of O'Malley v. Woodrough, there is liable. The exemption for a public purpose or a valid
justification in reversing our present ruling to the effect consideration is merely a nominal exemption, since the
that judges are not liable to tax on their salaries. After valid and full consideration or the public purpose
going over the opinion of the court in the said case, the promoted is received in the place of the tax. Theory and
Honorable, the Secretary of Justice, stated that Practice of Taxation (1900), D. A. Wells, p. 541. (Gordy
although the ruling of the Supreme Court of the United vs. Dennis (Md.) 1939, 5 Atl. Rep. 2d Series, p. 80)
States is not binding in the Philippines, the doctrine
therein enunciated has resolved the issue of the
taxability of judges' salaries into a question of policy. It is hard to see, appellants asserts, how the imposition of the
Forthwith, His Excellency the President decided that the income tax may imperil the independence of the judicial
best policy to adopt would be to collect income and department. The danger may be demonstrated. Suppose there is
additional residence taxes from the President of the power to tax the salary of judges, and the judiciary incurs the
Philippines, the members of the Judiciary, and the displeasure of the Legislature and the Executive. In retaliation
Auditor General, and the undersigned was authorized to the income tax law is amended so as to levy a 30 per cent on all
act accordingly. salaries of government officials on the level of judges. This
naturally reduces the salary of the judges by 30 per cent, but they
may not grumble because the tax is general on all receiving the
In view of the foregoing, income and additional same amount of earning, and affects the Executive and the
residence taxes should be levied on the salaries Legislative branches in equal measure. However, means are
provided thereafter in other laws, for the increase of salaries of Endencia was a diminution of their compensation and therefore
the Executive and the Legislative branches, or their perquisites was in violation of the Constitution of the Philippines, and so
such as allowances, per diems, quarters, etc. that actually ordered the refund of said taxes.
compensate for the 30 per cent reduction on their salaries.
Result: Judges compensation is thereby diminished during their We see no profit and necessity in again discussing and
incumbency thanks to the income tax law. Consequence: Judges considering the proposition and the arguments pro and cons
must "toe the line" or else. Second consequence: Some few involved in the case of Perfecto vs. Meer, supra, which are
judges might falter; the great majority will not. But knowing the raised, brought up and presented here. In that case, we have
frailty of human nature, and this chink in the judicial armor, will held despite the ruling enunciated by the United States Federal
the parties losing their cases against the Executive or the Supreme Court in the case of O 'Malley vs. Woodrought 307 U.
Congress believe that the judicature has not yielded to their S., 277, that taxing the salary of a judicial officer in the
pressure? Philippines is a diminution of such salary and so violates the
Constitution. We shall now confine our-selves to a discussion
Respondent asserts in argumentation that by executive order the and determination of the remaining question of whether or not
President has subjected his salary to the income tax law. In our Republic Act No. 590, particularly section 13, can justify and
opinion this shows obviously that, without such voluntary act of legalize the collection of income tax on the salary of judicial
the President, his salary would not be taxable, because of officers.
constitutional protection against diminution. To argue from this
executive gesture that the judiciary could, and should act in like According to the brief of the Solicitor General on behalf of
manner is to assume that, in the matter of compensation and appellant Collector of Internal Revenue, our decision in the case
power and need of security, the judiciary is on a par with the of Perfecto vs. Meer, supra, was not received favorably by
Executive. Such assumption certainly ignores the prevailing state Congress, because immediately after its promulgation, Congress
of affairs. enacted Republic Act No. 590. To bring home his point, the
Solicitor General reproduced what he considers the pertinent
The judgment will be affirmed. So ordered. discussion in the Lower House of House Bill No. 1127 which
became Republic Act No. 590.

For purposes of reference, we are reproducing section 9, Article

VIII of our Constitution:.

Republic of the Philippines SEC. 9. The members of the Supreme Court and all
SUPREME COURT judges of inferior courts shall hold office during good
Manila behavior, until they reach the age of seventy years, or
become incapacitated to discharge the duties of their
office. They shall receive such compensation as may be
EN BANC fixed by law, which shall not be diminished during their
continuance in office. Until the Congress shall provide
G.R. No. L-6355-56 August 31, 1953 otherwise, the Chief Justice of the Supreme Court shall
receive an annual compensation of sixteen thousand
PASTOR M. ENDENCIA and FERNANDO JUGO, plaintiffs- pesos, and each Associate Justice, fifteen thousand
appellees, pesos.
vs.
SATURNINO DAVID, as Collector of Internal As already stated construing and applying the above
Revenue, defendant-appellant. constitutional provision, we held in the Perfecto case that judicial
officers are exempt from the payment of income tax on their
Office of the Solicitor General Juan R. Liwag and Solicitor Jose salaries, because the collection thereof by the Government was a
P. Alejandro for appellant. decrease or diminution of their salaries during their continuance
Manuel O. Chan for appellees. in office, a thing which is expressly prohibited by the Constitution.
Thereafter, according to the Solicitor General, because Congress
did not favorably receive the decision in the Perfecto case,
MONTEMAYOR, J.: Congress promulgated Republic Act No. 590, if not to counteract
the ruling in that decision, at least now to authorize and legalize
This is a joint appeal from the decision of the Court of First the collection of income tax on the salaries of judicial officers. We
Instance of Manila declaring section 13 of Republic Act No. 590 quote section 13 of Republic Act No. 590:
unconstitutional, and ordering the appellant Saturnino David as
Collector of Internal Revenue to re-fund to Justice Pastor M. SEC 13. No salary wherever received by any public
Endencia the sum of P1,744.45, representing the income tax officer of the Republic of the Philippines shall be
collected on his salary as Associate Justice of the Court of considered as exempt from the income tax, payment of
Appeals in 1951, and to Justice Fernando Jugo the amount of which is hereby declared not to be dimunition of his
P2,345.46, representing the income tax collected on his salary compensation fixed by the Constitution or by law.
from January 1,1950 to October 19, 1950, as Presiding Justice of
the Court of Appeals, and from October 20, 1950 to December
31,1950, as Associate Justice of the Supreme Court, without So we have this situation. The Supreme Court in a decision
special pronouncement as to costs. interpreting the Constitution, particularly section 9, Article VIII,
has held that judicial officers are exempt from payment of income
tax on their salaries, because the collection thereof was a
Because of the similarity of the two cases, involving as they do diminution of such salaries, specifically prohibited by the
the same question of law, they were jointly submitted for Constitution. Now comes the Legislature and in section 13,
determination in the lower court. Judge Higinio B. Macadaeg Republic Act No. 590, says that "no salary wherever received by
presiding, in a rather exhaustive and well considered decision any public officer of the Republic (naturally including a judicial
found and held that under the doctrine laid down by this Court in officer) shall be considered as exempt from the income tax," and
the case of Perfecto vs. Meer, 85 Phil., 552, the collection of proceeds to declare that payment of said income tax is not a
income taxes from the salaries of Justice Jugo and Justice
diminution of his compensation. Can the Legislature validly do The legislature cannot, upon passing a law which
this? May the Legislature lawfully declare the collection of violates a constitutional provision, validate it so as to
income tax on the salary of a public official, specially a judicial prevent an attack thereon in the courts, by a declaration
officer, not a decrease of his salary, after the Supreme Court has that it shall be so construed as not to violate the
found and decided otherwise? To determine this question, we constitutional inhibition. (11 Am. Jur., 919, emphasis
shall have to go back to the fundamental principles regarding supplied)
separation of powers.
We have already said that the Legislature under our form of
Under our system of constitutional government, the Legislative government is assigned the task and the power to make and
department is assigned the power to make and enact laws. The enact laws, but not to interpret them. This is more true with
Executive department is charged with the execution of carrying regard to the interpretation of the basic law, the Constitution,
out of the provisions of said laws. But the interpretation and which is not within the sphere of the Legislative department. If the
application of said laws belong exclusively to the Judicial Legislature may declare what a law means, or what a specific
department. And this authority to interpret and apply the laws portion of the Constitution means, especially after the courts
extends to the Constitution. Before the courts can determine have in actual case ascertain its meaning by interpretation and
whether a law is constitutional or not, it will have to interpret and applied it in a decision, this would surely cause confusion and
ascertain the meaning not only of said law, but also of the instability in judicial processes and court decisions. Under such a
pertinent portion of the Constitution in order to decide whether system, a final court determination of a case based on a judicial
there is a conflict between the two, because if there is, then the interpretation of the law of the Constitution may be undermined
law will have to give way and has to be declared invalid and or even annulled by a subsequent and different interpretation of
unconstitutional. the law or of the Constitution by the Legislative department. That
would be neither wise nor desirable, besides being clearly
Defining and interpreting the law is a judicial function violative of the fundamental, principles of our constitutional
and the legislative branch may not limit or restrict the system of government, particularly those governing the
power granted to the courts by the Constitution. (Bandy separation of powers.
vs. Mickelson et al., 44N. W., 2nd 341, 342.)
So much for the constitutional aspect of the case. Considering
When it is clear that a statute transgresses the authority the practical side thereof, we believe that the collection of income
vested in the legislature by the Constitution, it is the duty tax on a salary is an actual and evident diminution thereof. Under
of the courts to declare the act unconstitutional because the old system where the in-come tax was paid at the end of the
they cannot shrink from it without violating their oaths of year or sometime thereafter, the decrease may not be so
office. This duty of the courts to maintain the apparent and clear. All that the official who had previously
Constitution as the fundamental law of the state is received his full salary was called upon to do, was to fulfill his
imperative and unceasing; and, as Chief Justice obligation and to exercise his privilege of paying his income tax
Marshall said, whenever a statute is in violation of the on his salary. His salary fixed by law was received by him in the
fundamental law, the courts must so adjudge and amount of said tax comes from his other sources of income, he
thereby give effect to the Constitution. Any other course may not fully realize the fact that his salary had been decreased
would lead to the destruction of the Constitution. Since in the amount of said income tax. But under the present system
the question as to the constitutionality of a statute is a of withholding the income tax at the source, where the full
judicial matter, the courts will not decline the exercise of amount of the income tax corresponding to his salary is
jurisdiction upon the suggestion that action might be computed in advance and divided into equal portions
taken by political agencies in disregard of the judgment corresponding to the number of pay-days during the year and
of the judicial tribunals. (11 Am. Jur., 714-715.) actually deducted from his salary corresponding to each payday,
said official actually does not receive his salary in full, because
the income tax is deducted therefrom every payday, that is to
Under the American system of constitutional say, twice a month. Let us take the case of Justice Endencia. As
government, among the most important functions in Associate Justice of the Court of Appeals, his salary is fixed at
trusted to the judiciary are the interpreting of p12,000 a year, that is to say, he should receive P1,000 a month
Constitutions and, as a closely connected power, the or P500 every payday, — fifteenth and end of month. In the
determination of whether laws and acts of the present case, the amount collected by the Collector of Internal
legislature are or are not contrary to the provisions of Revenue on said salary is P1,744.45 for one year. Divided by
the Federal and State Constitutions. (11 Am. Jur., 905.). twelve (months) we shall have P145.37 a month. And further
dividing it by two paydays will bring it down to P72.685, which is
By legislative fiat as enunciated in section 13, Republic Act NO. the income tax deducted form the collected on his salary each
590, Congress says that taxing the salary of a judicial officer is half month. So, if Justice Endencia's salary as a judicial officer
not a decrease of compensation. This is a clear example of were not exempt from payment of the income tax, instead of
interpretation or ascertainment of the meaning of the phrase receiving P500 every payday, he would be actually receiving
"which shall not be diminished during their continuance in office," P427.31 only, and instead of receiving P12,000 a year, he would
found in section 9, Article VIII of the Constitution, referring to the be receiving but P10,255.55. Is it not therefor clear that every
salaries of judicial officers. This act of interpreting the payday, his salary is actually decreased by P72.685 and every
Constitution or any part thereof by the Legislature is an invasion year is decreased by P1,744.45?
of the well-defined and established province and jurisdiction of
the Judiciary. Reading the discussion in the lower House in connection with
House Bill No. 1127, which became Republic Act No. 590, it
The rule is recognized elsewhere that the legislature would seem that one of the main reasons behind the enactment
cannot pass any declaratory act, or act declaratory of of the law was the feeling among certain legislators that
what the law was before its passage, so as to give it any members of the Supreme Court should not enjoy any exemption
binding weight with the courts. A legislative definition of and that as citizens, out of patriotism and love for their country,
a word as used in a statute is not conclusive of its they should pay income tax on their salaries. It might be stated in
meaning as used elsewhere; otherwise, the legislature this connection that the exemption is not enjoyed by the
would be usurping a judicial function in defining a term. members of the Supreme Court alone but also by all judicial
(11 Am. Jur., 914, emphasis supplied) officers including Justices of the Court of Appeals and judges of
inferior courts. The exemption also extends to other constitutional
officers, like the President of the Republic, the Auditor General, Considering exemption in the abstract, there is nothing unusual
the members of the Commission on Elections, and possibly or abhorrent in it, as long as it is based on public policy or public
members of the Board of Tax Appeals, commissioners of the interest. While all other citizens are subject to arrest when
Public Service Commission, and judges of the Court of Industrial charged with the commission of a crime, members of the Senate
Relations. Compares to the number of all these officials, that of and House of Representatives except in cases of treason, felony
the Supreme Court Justices is relatively insignificant. There are and breach of the peace are exempt from arrest, during their
more than 990 other judicial officers enjoying the exemption, attendance in the session of the Legislature; and while all other
including 15 Justices of the Court of Appeals, about 107 Judges citizens are generally liable for any speech, remark or statement,
of First Instance, 38 Municipal Judges and about 830 Justices of oral or written, tending to cause the dishonor, discredit or
the Peace. The reason behind the exemption in the Constitution, contempt of a natural or juridical person or to blacken the
as interpreted by the United States Federal Supreme Court and memory of one who is dead, Senators and Congressmen in
this Court, is to preserve the independence of the Judiciary, not making such statements during their sessions are extended
only of this High Tribunal but of the other courts, whose present immunity and exemption.
membership number more than 990 judicial officials.
And as to tax exemption, there are not a few citizens who enjoy
The exemption was not primarily intended to benefit judicial this exemption. Persons, natural and juridical, are exempt from
officers, but was grounded on public policy. As said by Justice taxes on their lands, buildings and improvements thereon when
Van Devanter of the United States Supreme Court in the case of used exclusively for educational purposes, even if they derive
Evans vs. Gore (253 U. S., 245): income therefrom. (Art. VI, Sec. 22 [3].) Holders of government
bonds are exempted from the payment of taxes on the income or
The primary purpose of the prohibition against interest they receive therefrom (sec. 29 (b) [4], National Internal
diminution was not to benefit the judges, but, like the Revenue Code as amended by Republic Act No. 566). Payments
clause in respect of tenure, to attract good and or income received by any person residing in the Philippines
competent men to the bench and to promote that under the laws of the United States administered by the United
independence of action and judgment which is essential States Veterans Administration are exempt from taxation.
to the maintenance of the guaranties, limitations and (Republic Act No. 360). Funds received by officers and enlisted
pervading principles of the Constitution and to the men of the Philippine Army who served in the Armed Forces of
administration of justice without respect to person and the United States, allowances earned by virtue of such services
with equal concern for the poor and the rich. Such being corresponding to the taxable years 1942 to 1945, inclusive, are
its purpose, it is to be construed, not as a private grant, exempted from income tax. (Republic Act No. 210). The payment
but as a limitation imposed in the public interest; in other of wages and allowances of officers and enlisted men of the
words, not restrictively, but in accord with its spirit and Army Forces of the Philippines sent to Korea are also exempted
the principle on which it proceeds. from taxation. (Republic Act No. 35). In other words, for reasons
of public policy and public interest, a citizen may justifiably by
constitutional provision or statute be exempted from his ordinary
Having in mind the limited number of judicial officers in the obligation of paying taxes on his income. Under the same public
Philippines enjoying this exemption, especially when the great policy and perhaps for the same it not higher considerations, the
bulk thereof are justices of the peace, many of them receiving as framers of the Constitution deemed it wise and necessary to
low as P200 a month, and considering further the other exempt judicial officers from paying taxes on their salaries so as
exemptions allowed by the income tax law, such as P3,000 for a not to decrease their compensation, thereby insuring the
married person and P600 for each dependent, the amount of independence of the Judiciary.
national revenue to be derived from income tax on the salaries of
judicial officers, were if not for the constitutional exemption, could
not be large or substantial. But even if it were otherwise, it should In conclusion we reiterate the doctrine laid down in the case
not affect, much less outweigh the purpose and the of Perfecto vs. Meer, supra, to the effect that the collection of
considerations that prompted the establishment of the income tax on the salary of a judicial officer is a diminution
constitutional exemption. In the same case of Evans vs. Gore, thereof and so violates the Constitution. We further hold that the
supra, the Federal Supreme Court declared "that they (fathers of interpretation and application of the Constitution and of statutes
the Constitution) regarded the independence of the judges as far is within the exclusive province and jurisdiction of the Judicial
as greater importance than any revenue that could come from department, and that in enacting a law, the Legislature may not
taxing their salaries. legally provide therein that it be interpreted in such a way that it
may not violate a Constitutional prohibition, thereby tying the
hands of the courts in their task of later interpreting said statute,
When a judicial officer assumed office, he does not exactly ask specially when the interpretation sought and provided in said
for exemption from payment of income tax on his salary, as a statute runs counter to a previous interpretation already given in
privilege . It is already attached to his office, provided and a case by the highest court of the land.
secured by the fundamental law, not primarily for his benefit, but
based on public interest, to secure and preserve his
independence of judicial thought and action. When we come to In the views of the foregoing considerations, the decision
the members of the Supreme Court, this excemption to them is appealed from is hereby affirmed, with no pronouncement as to
relatively of short duration. Because of the limited membership in costs.
this High Tribunal, eleven, and due to the high standards of
experience, practice and training required, one generally enters
its portals and comes to join its membership quite late in life, on
the aver-age, around his sixtieth year, and being required to
retire at seventy, assuming that he does not die or become
incapacitated earlier, naturally he is not in a position to receive
the benefit of exemption for long. It is rather to the justices of the
peace that the exemption can give more benefit. They are
relatively more numerous, and because of the meager salary
they receive, they can less afford to pay the income tax on it and
Republic of the Philippines
its diminution by the amount of the income tax if paid would be
SUPREME COURT
real, substantial and onerous.
Manila
 EN BANC record that it had then discarded the ruling in Perfecto vs. Meer
and Endencia vs. David, infra, that declared the salaries of
G.R. No. 78780 July 23, 1987 members of the Judiciary exempt from payment of the income
tax and considered such payment as a diminution of their
salaries during their continuance in office. The Court hereby
DAVID G. NITAFAN, WENCESLAO M. POLO, and MAXIMO A. reiterates that the salaries of Justices and Judges are properly
SAVELLANO, JR., petitioners, subject to a general income tax law applicable to all income
vs. earners and that the payment of such income tax by Justices and
COMMISSIONER OF INTERNAL REVENUE and THE Judges does not fall within the constitutional protection against
FINANCIAL OFFICER, SUPREME COURT OF THE decrease of their salaries during their continuance in office.
PHILIPPINES, respondents.
A comparison of the Constitutional provisions involved is called
RESOLUTION for. The 1935 Constitution provided:

MELENCIO-HERRERA, J.: ... (The members of the Supreme Court and all judges
of inferior courts) shall receive such compensation as
Petitioners, the duly appointed and qualified Judges presiding may be fixed by law, which shall not
over Branches 52, 19 and 53, respectively, of the Regional Trial be diminished during their continuance in
Court, National Capital Judicial Region, all with stations in office ... 1 (Emphasis supplied).
Manila, seek to prohibit and/or perpetually enjoin respondents,
the Commissioner of Internal Revenue and the Financial Officer Under the 1973 Constitution, the same provision read:
of the Supreme Court, from making any deduction of withholding
taxes from their salaries.
The salary of the Chief Justice and of the Associate
Justices of the Supreme court, and of judges of inferior
In a nutshell, they submit that "any tax withheld from their courts shall be fixed by law, which shall not
emoluments or compensation as judicial officers constitutes a be decreased during their continuance in
decrease or diminution of their salaries, contrary to the provision office. ... 2 (Emphasis ours).
of Section 10, Article VIII of the 1987 Constitution mandating that
"(d)uring their continuance in office, their salary shall not be
decreased," even as it is anathema to the Ideal of an And in respect of income tax exemption, another provision in the
independent judiciary envisioned in and by said Constitution." same 1973 Constitution specifically stipulated:

It may be pointed out that, early on, the Court had dealt with the No salary or any form of emolument of any public officer
matter administratively in response to representations that the or employee, including constitutional officers, shall be
Court direct its Finance Officer to discontinue the withholding of exempt from payment of income tax. 3
taxes from salaries of members of the Bench. Thus, on June 4,
1987, the Court en banc had reaffirmed the Chief Justice's The provision in the 1987 Constitution, which petitioners rely on,
directive as follows: reads:

RE: Question of exemption from income taxation. — The salary of the Chief Justice and of the Associate
The Court REAFFIRMED the Chief Justice's previous Justices of the Supreme Court, and of judges of lower
and standing directive to the Fiscal Management and courts shall be fixed by law. During their continuance in
Budget Office of this Court to continue with the office, their salary shall not be decreased. 4(Emphasis
deduction of the withholding taxes from the salaries of supplied).
the Justices of the Supreme Court as well as from the
salaries of all other members of the judiciary. The 1987 Constitution does not contain a provision similar to
Section 6, Article XV of the 1973 Constitution, for which reason,
That should have resolved the question. However, with the filing petitioners claim that the intent of the framers is to revert to the
of this petition, the Court has deemed it best to settle the legal original concept of "non-diminution "of salaries of judicial officers.
issue raised through this judicial pronouncement. As will be
shown hereinafter, the clear intent of the Constitutional The deliberations of the 1986 Constitutional Commission relevant
Commission was to delete the proposed express grant of to Section 10, Article VIII, negate such contention.
exemption from payment of income tax to members of the
Judiciary, so as to "give substance to equality among the three
branches of Government" in the words of Commissioner Rigos. The draft proposal of Section 10, Article VIII, of the 1987
In the course of the deliberations, it was further expressly made Constitution read:
clear, specially with regard to Commissioner Joaquin F. Bernas'
accepted amendment to the amendment of Commissioner Rigos, Section 13. The salary of the Chief Justice and the
that the salaries of members of the Judiciary would be subject to Associate Justices of the Supreme Court and of judges
the general income tax applied to all taxpayers. of the lower courts shall be fixed by law. During their
continuance in office, their salary shall not be
This intent was somehow and inadvertently not clearly set forth in diminished nor subjected to income tax. Until the
the final text of the Constitution as approved and ratified in National Assembly shall provide otherwise, the Chief
February, 1987 (infra, pp. 7-8). Although the intent may have Justice shall receive an annual salary of
been obscured by the failure to include in the General Provisions _____________ and each Associate Justice
a proscription against exemption of any public officer or ______________ pesos. 5(Emphasis ours)
employee, including constitutional officers, from payment of
income tax, the Court since then has authorized the continuation During the debates on the draft Article (Committee Report No.
of the deduction of the withholding tax from the salaries of the 18), two Commissioners presented their objections to the
members of the Supreme Court, as well as from the salaries of provision on tax exemption, thus:
all other members of the Judiciary. The Court hereby makes of
 MS. AQUINO. Finally, on the matter of exemption from INCOME TAX."IN support of this position, I would say
tax of the salary of justices, does this not violate the that the argument seems to be that the justice and
principle of the uniformity of taxation and the principle of judges should not be subjected to income tax because
equal protection of the law? After all, tax is levied not on they already gave up the income from their practice.
the salary but on the combined income, such that when That is true also of Cabinet members and all other
the judge receives a salary and it is comingled with the employees. And I know right now, for instance, there are
other income, we tax the income, not the salary. Why do many people who have accepted employment in the
we have to give special privileges to the salary of government involving a reduction of income and yet are
justices? still subject to income tax. So, they are not the only
citizens whose income is reduced by accepting service
MR. CONCEPCION. It is the independence of the in government.
judiciary. We prohibit the increase or decrease of their
salary during their term. This is an indirect way of Commissioner Rigos accepted the proposed amendment to the
decreasing their salary and affecting the independence amendment. Commissioner Rustico F. de los Reyes, Jr. then
of the judges. moved for a suspension of the session. Upon resumption,
Commissioner Bernas announced:
MS. AQUINO. I appreciate that to be in the nature of a
clause to respect tenure, but the special privilege on During the suspension, we came to an understanding
taxation might, in effect, be a violation of the principle of with the original proponent, Commissioner Rigos, that
uniformity in taxation and the equal protection clause. 6 his amendment on page 6,. line 4 would read: "During
their continuance in office, their salary shall not be
xxx xxx xxx DECREASED."But this is on the understanding that
there will be a provision in the Constitution similar to
Section 6 of Article XV, the General Provisions of the
MR. OPLE. x x x 1973 Constitution, which says:

Of course, we share deeply the concern expressed by No salary or any form of emolument of any
the sponsor, Commissioner Roberto Concepcion, for public officer or employee, including
whom we have the highest respect, to surround the constitutional officers, shall be exempt from
Supreme Court and the judicial system as a whole with payment of income tax.
the whole armor of defense against the executive and
legislative invasion of their independence. But in so
doing, some of the citizens outside, especially the So, we put a period (.) after "DECREASED" on the
humble government employees, might say that in trying understanding that the salary of justices is subject to
to erect a bastion of justice, we might end up with the tax.
fortress of privileges, an island of extra territoriality
under the Republic of the Philippines, because a good When queried about the specific Article in the General Provisions
number of powers and rights accorded to the Judiciary on non-exemption from tax of salaries of public officers,
here may not be enjoyed in the remotest degree by Commissioner Bernas replied:
other employees of the government.
FR BERNAS. Yes, I do not know if such an article will be
An example is the exception from income tax, which is a found in the General Provisions. But at any rate, when
kind of economic immunity, which is, of course, denied we put a period (.) after "DECREASED," it is on the
to the entire executive department and the legislative. 7 understanding that the doctrine in Perfecto vs. Meer and
Dencia vs. David will not apply anymore.
And during the period of amendments on the draft Article, on July
14, 1986, Commissioner Cirilo A. Rigos proposed that the term The amendment to the original draft, as discussed and
"diminished" be changed to "decreased" and that the words "nor understood, was finally approved without objection.
subjected to income tax" be deleted so as to "give substance to
equality among the three branches in the government. THE PRESIDING OFFICER (Mr. Bengzon). The
understanding, therefore, is that there will be a provision
Commissioner Florenz D. Regalado, on behalf of the Committee under the Article on General Provisions. Could
on the Judiciary, defended the original draft and referred to the Commissioner Rosario Braid kindly take note that the
ruling of this Court in Perfecto vs. Meer 8 that "the independence salaries of officials of the government including
of the judges is of far greater importance than any revenue that constitutional officers shall not be exempt from income
could come from taxing their salaries." Commissioner Rigos then tax? The amendment proposed herein and accepted by
moved that the matter be put to a vote. Commissioner Joaquin the Committee now reads as follows: "During their
G. Bernas stood up "in support of an amendment to the continuance in office, their salary shall not be
amendment with the request for a modification of the DECREASED"; and the phrase "nor subjected to
amendment," as follows: income tax" is deleted.9

FR. BERNAS. Yes. I am going to propose an The debates, interpellations and opinions expressed regarding
amendment to the amendment saying that it is not the constitutional provision in question until it was finally
enough to drop the phrase "shall not be subjected to approved by the Commission disclosed that the true intent of the
income tax," because if that is all that the Gentleman framers of the 1987 Constitution, in adopting it, was to make the
will do, then he will just fall back on the decision salaries of members of the Judiciary taxable. The ascertainment
in Perfecto vs. Meer and in Dencia vs. David [should be of that intent is but in keeping with the fundamental principle of
Endencia and Jugo vs. David, etc., 93 Phil. 696[ which constitutional construction that the intent of the framers of the
excludes them from income tax, but rather I would organic law and of the people adopting it should be given
propose that the statement will read: "During their effect.10 The primary task in constitutional construction is to
continuance in office, their salary shall not be ascertain and thereafter assure the realization of the purpose of
diminished BUT MAY BE SUBJECT TO GENERAL the framers and of the people in the adoption of the
Constitution.11it may also be safely assumed that the people in In May, 1936, the Director of Posts announced in the dailies of
ratifying the Constitution were guided mainly by the explanation Manila that he would order the issues of postage stamps
offered by the framers.12 1avvphi1 commemorating the celebration in the City of Manila of the Thirty-
third international Eucharistic Congress, organized by the Roman
Besides, construing Section 10, Articles VIII, of the 1987 Catholic Church. The petitioner, in the fulfillment of what he
Constitution, which, for clarity, is again reproduced hereunder: considers to be a civic duty, requested Vicente Sotto, Esq.,
member of the Philippine Bar, to denounce the matter to the
President of the Philippines. In spite of the protest of the
The salary of the Chief Justice and of the Associate petitioner's attorney, the respondent publicly announced having
Justices of the Supreme Court, and of judges of lower sent to the United States the designs of the postage stamps for
courts shall be fixed by law. During their continuance in printing as follows:
office, their salary shall not be decreased. (Emphasis
supplied).
"In the center is chalice, with grape vine and stalks of wheat as
border design. The stamps are blue, green, brown, cardinal red,
it is plain that the Constitution authorizes Congress to pass a law violet and orange, 1 inch by 1,094 inches. The denominations are
fixing another rate of compensation of Justices and Judges but for 2, 6, 16, 20, 36 and 50 centavos." The said stamps were
such rate must be higher than that which they are receiving at actually issued and sold though the greater part thereof, to this
the time of enactment, or if lower, it would be applicable only to day, remains unsold. The further sale of the stamps is sought to
those appointed after its approval. It would be a strained be prevented by the petitioner herein.
construction to read into the provision an exemption from
taxation in the light of the discussion in the Constitutional
Commission. The Solicitor-General contends that the writ of prohibition is not
the proper legal remedy in the instant case, although he admits
that the writ may properly restrain ministerial functions. While,
With the foregoing interpretation, and as stated heretofore, the generally, prohibition as an extraordinary legal writ will not issue
ruling that "the imposition of income tax upon the salary of judges to restrain or control the performance of other than judicial or
is a dimunition thereof, and so violates the Constitution" quasi-judicial functions (50 C. J., 6580, its issuance and
in Perfecto vs. Meer,13 as affirmed in Endencia vs. David 14 must enforcement are regulated by statute and in this jurisdiction may
be declared discarded. The framers of the fundamental law, as issue to . . . inferior tribunals, corporations, boards, or persons,
the alter ego of the people, have expressed in clear and whether excercising functions judicial or ministerial, which are
unmistakable terms the meaning and import of Section 10, Article without or in excess of the jurisdiction of such tribunal,
VIII, of the 1987 Constitution that they have adopted corporation, board, or person, . . . ." (Secs. 516 and 226, Code of
Civil Procedure.) The terms "judicial" and "ministerial" used with
Stated otherwise, we accord due respect to the intent of the reference to "functions" in the statute are undoubtedly
people, through the discussions and deliberations of their comprehensive and include the challenged act of the respondent
representatives, in the spirit that all citizens should bear their Director of Posts in the present case, which act because alleged
aliquot part of the cost of maintaining the government and should to be violative of the Constitution is a fortiorari "without or in
share the burden of general income taxation equitably. excess of . . . jurisdiction." The statutory rule, therefore, in the
jurisdiction is that the writ of prohibition is not confined
WHEREFORE, the instant petition for Prohibition is hereby exclusively to courts or tribunals to keep them within the limits of
dismissed. their own jurisdiction and to prevent them from encroaching upon
the jurisdiction of other tribunals, but will issue, in appropriate
cases, to an officer or person whose acts are without or in excess
of his authority. Not infrequently, "the writ is granted, where it is
necessary for the orderly administration of justice, or to prevent
the use of the strong arm of the law in an oppressive or vindictive
manner, or a multiplicity of actions." (Dimayuga and Fajardo vs.
Republic of the Philippines Fernandez [1923], 43 Phil., 304, 307.)
SUPREME COURT
Manila The more important question raised refers to the alleged violation
of the Constitution by the respondent in issuing and selling
EN BANC postage stamps commemorative of the Thirty-third International
Eucharistic Congress. It is alleged that this action of the
respondent is violative of the provisions of section 23, subsection
G.R. No. L-45459 March 13, 1937 3, Article VI, of the Constitution of the Philippines, which provides
as follows:
GREGORIO AGLIPAY, petitioner,
vs. No public money or property shall ever be appropriated,
JUAN RUIZ, respondent. applied, or used, directly or indirectly, for the use,
benefit, or support of any sect, church, denomination,
Vicente Sotto for petitioner. secretarian, institution, or system of religion, or for the
Office of the Solicitor-General Tuason for respondent. use, benefit, or support of any priest, preacher, minister,
or other religious teacher or dignitary as such, except
when such priest, preacher, minister, or dignitary is
LAUREL, J.:
assigned to the armed forces or to any penal institution,
orphanage, or leprosarium.
The petitioner, Mons. Gregorio Aglipay, Supreme Head of the
Philippine Independent Church, seeks the issuance from this
The prohibition herein expressed is a direct corollary of the
court of a writ of prohibition to prevent the respondent Director of
principle of separation of church and state. Without the necessity
Posts from issuing and selling postage stamps commemorative
of adverting to the historical background of this principle in our
of the Thirty-third International Eucharistic Congress.
country, it is sufficient to say that our history, not to speak of the
history of mankind, has taught us that the union of church and
state is prejudicial to both, for ocassions might arise when the
estate will use the church, and the church the state, as a weapon SECTION 1. The sum of sixty thousand pesos is hereby
in the furtherance of their recognized this principle of separation appropriated and made immediately available out of any funds in
of church and state in the early stages of our constitutional the Insular Treasury not otherwise appropriated, for the costs of
development; it was inserted in the Treaty of Paris between the plates and printing of postage stamps with new designs, and
United States and Spain of December 10, 1898, reiterated in other expenses incident thereto.
President McKinley's Instructions of the Philippine Commission,
reaffirmed in the Philippine Bill of 1902 and in the autonomy Act SEC. 2. The Director of Posts, with the approval of the Secretary
of August 29, 1916, and finally embodied in the constitution of the of Public Works and Communications, is hereby authorized to
Philippines as the supreme expression of the Filipino people. It is dispose of the whole or any portion of the amount herein
almost trite to say now that in this country we enjoy both religious appropriated in the manner indicated and as often as may be
and civil freedom. All the officers of the Government, from the deemed advantageous to the Government.
highest to the lowest, in taking their oath to support and defend
the constitution, bind themselves to recognize and respect the
constitutional guarantee of religious freedom, with its inherent SEC. 3. This amount or any portion thereof not otherwise
limitations and recognized implications. It should be stated that expended shall not revert to the Treasury.
what is guaranteed by our Constitution is religious liberty, not
mere religious toleration. SEC. 4. This act shall take effect on its approval.

Religious freedom, however, as a constitutional mandate is not Approved, February 21, 1933.
inhibition of profound reverence for religion and is not denial of its
influence in human affairs. Religion as a profession of faith to an It will be seen that the Act appropriates the sum of sixty thousand
active power that binds and elevates man to his Creator is pesos for the costs of plates and printing of postage stamps with
recognized. And, in so far as it instills into the minds the purest new designs and other expenses incident thereto, and authorizes
principles of morality, its influence is deeply felt and highly the Director of Posts, with the approval of the Secretary of Public
appreciated. When the Filipino people, in the preamble of their Works and Communications, to dispose of the amount
Constitution, implored "the aid of Divine Providence, in order to appropriated in the manner indicated and "as often as may be
establish a government that shall embody their ideals, conserve deemed advantageous to the Government". The printing and
and develop the patrimony of the nation, promote the general issuance of the postage stamps in question appears to have
welfare, and secure to themselves and their posterity the been approved by authority of the President of the Philippines in
blessings of independence under a regime of justice, liberty and a letter dated September 1, 1936, made part of the respondent's
democracy," they thereby manifested reliance upon Him who memorandum as Exhibit A. The respondent alleges that the
guides the destinies of men and nations. The elevating influence Government of the Philippines would suffer losses if the writ
of religion in human society is recognized here as elsewhere. In prayed for is granted. He estimates the revenue to be derived
fact, certain general concessions are indiscriminately accorded to from the sale of the postage stamps in question at P1,618,17.10
religious sects and denominations. Our Constitution and laws and states that there still remain to be sold stamps worth
exempt from taxation properties devoted exclusively to religious P1,402,279.02.
purposes (sec. 14, subsec. 3, Art. VI, Constitution of the
Philippines and sec. 1, subsec. 4, Ordinance appended thereto;
Assessment Law, sec. 344, par. [c]. Adm. Code). Sectarian aid is Act No. 4052 contemplates no religious purpose in view. What it
not prohibited when a priest, preacher, minister or other religious gives the Director of Posts is the discretionary power to
teacher or dignitary as such is assigned to the armed forces or to determine when the issuance of special postage stamps would
any penal institution, orphanage or leprosarium 9 sec. 13, be "advantageous to the Government." Of course, the phrase
subsec. 3, Art. VI, Constitution of the Philippines). Optional "advantageous to the Government" does not authorize the
religious instruction in the public schools is by constitutional violation of the Constitution. It does not authorize the
mandate allowed (sec. 5, Art. XIII, Constitution of the Philippines, appropriation, use or application of public money or property for
in relation to sec. 928, Adm. Code). Thursday and Friday of Holy the use, benefit or support of a particular sect or church. In the
Week, Thanksgiving Day, Christmas Day, and Sundays and present case, however, the issuance of the postage stamps in
made legal holidays (sec. 29, Adm. Code) because of the secular question by the Director of Posts and the Secretary of Public
idea that their observance is conclusive to beneficial moral Works and Communications was not inspired by any sectarian
results. The law allows divorce but punishes polygamy and denomination. The stamps were not issue and sold for the benefit
bigamy; and certain crimes against religious worship are of the Roman Catholic Church. Nor were money derived from the
considered crimes against the fundamental laws of the state sale of the stamps given to that church. On the contrary, it
(see arts. 132 and 133, Revised Penal Code). appears from the latter of the Director of Posts of June 5, 1936,
incorporated on page 2 of the petitioner's complaint, that the only
purpose in issuing and selling the stamps was "to advertise the
In the case at bar, it appears that the respondent Director of Philippines and attract more tourist to this country." The officials
Posts issued the postage stamps in question under the concerned merely, took advantage of an event considered of
provisions of Act No. 4052 of the Philippine Legislature. This Act international importance "to give publicity to the Philippines and
is as follows: its people" (Letter of the Undersecretary of Public Works and
Communications to the President of the Philippines, June 9,
No. 4052. — AN ACT APPROPRIATING THE SUM OF 1936; p. 3, petitioner's complaint). It is significant to note that the
SIXTY THOUSAND PESOS AND MAKING THE SAME stamps as actually designed and printed (Exhibit 2), instead of
AVAILABLE OUT OF ANY FUNDS IN THE INSULAR showing a Catholic Church chalice as originally planned, contains
TREASURY NOT OTHERWISE APPROPRIATED FOR a map of the Philippines and the location of the City of Manila,
THE COST OF PLATES AND PRINTING OF POSTAGE and an inscription as follows: "Seat XXXIII International
STAMPS WITH NEW DESIGNS, AND FOR OTHER Eucharistic Congress, Feb. 3-7,1937." What is emphasized is not
PURPOSES. the Eucharistic Congress itself but Manila, the capital of the
Philippines, as the seat of that congress. It is obvious that while
Be it enacted by the Senate and House of the issuance and sale of the stamps in question may be said to
Representatives of the Philippines in Legislature be inseparably linked with an event of a religious character, the
assembled and by the authority of the same: resulting propaganda, if any, received by the Roman Catholic
Church, was not the aim and purpose of the Government. We are
of the opinion that the Government should not be embarassed in
its activities simply because of incidental results, more or less
religious in character, if the purpose had in view is one which part of the national economy and patrimony covered by the
could legitimately be undertaken by appropriate legislation. The protective mantle of the Constitution.
main purpose should not be frustrated by its subordinate to mere
incidental results not contemplated. (Vide Bradfield vs. Roberts, The controversy arose when respondent Government Service
175 U. S., 295; 20 Sup. Ct. Rep., 121; 44 Law. ed., 168.) Insurance System (GSIS), pursuant to the privatization program
of the Philippine Government under Proclamation No. 50 dated 8
We are much impressed with the vehement appeal of counsel for December 1986, decided to sell through public bidding 30% to
the petitioner to maintain inviolate the complete separation of 51% of the issued and outstanding shares of respondent MHC.
church and state and curb any attempt to infringe by indirection a The winning bidder, or the eventual "strategic partner," is to
constitutional inhibition. Indeed, in the Philippines, once the provide management expertise and/or an international
scene of religious intolerance and prescription, care should be marketing/reservation system, and financial support to
taken that at this stage of our political development nothing is strengthen the profitability and performance of the Manila
done by the Government or its officials that may lead to the belief Hotel.2 In a close bidding held on 18 September 1995 only two
that the Government is taking sides or favoring a particular (2) bidders participated: petitioner Manila Prince Hotel
religious sect or institution. But, upon very serious reflection, Corporation, a Filipino corporation, which offered to buy 51% of
examination of Act No. 4052, and scrutiny of the attending the MHC or 15,300,000 shares at P41.58 per share, and Renong
circumstances, we have come to the conclusion that there has Berhad, a Malaysian firm, with ITT-Sheraton as its hotel operator,
been no constitutional infraction in the case at bar, Act No. 4052 which bid for the same number of shares at P44.00 per share, or
grants the Director of Posts, with the approval of the Secretary of P2.42 more than the bid of petitioner.
Public Works and Communications, discretion to misuse postage
stamps with new designs "as often as may be deemed Pertinent provisions of the bidding rules prepared by respondent
advantageous to the Government." Even if we were to assume GSIS state —
that these officials made use of a poor judgment in issuing and
selling the postage stamps in question still, the case of the
petitioner would fail to take in weight. Between the exercise of a I. EXECUTION OF THE NECESSARY CONTRACTS
poor judgment and the unconstitutionality of the step taken, a WITH GSIS/MHC —
gap exists which is yet to be filled to justify the court in setting
aside the official act assailed as coming within a constitutional 1. The Highest Bidder must comply with the conditions set forth
inhibition. below by October 23, 1995 (reset to November 3, 1995) or the
Highest Bidder will lose the right to purchase the Block of Shares
The petition for a writ of prohibition is hereby denied, without and GSIS will instead offer the Block of Shares to the other
pronouncement as to costs. So ordered. Qualified Bidders:

a. The Highest Bidder must negotiate and execute with

the GSIS/MHC the Management Contract, International
Marketing/Reservation System Contract or other type of
contract specified by the Highest Bidder in its strategic
plan for the Manila Hotel. . . .

b. The Highest Bidder must execute the Stock Purchase

Republic of the Philippines
and Sale Agreement with GSIS . . . .
SUPREME COURT
Manila
K. DECLARATION OF THE WINNING
BIDDER/STRATEGIC PARTNER —
EN BANC

The Highest Bidder will be declared the Winning Bidder/Strategic

Partner after the following conditions are met:

G.R. No. 122156 February 3, 1997

a. Execution of the necessary contracts with GSIS/MHC
not later than October 23, 1995 (reset to November 3,
MANILA PRINCE HOTEL petitioner, 1995); and
vs.
GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA
b. Requisite approvals from the GSIS/MHC and COP
HOTEL CORPORATION, COMMITTEE ON PRIVATIZATION
(Committee on Privatization)/OGCC (Office of the
and OFFICE OF THE GOVERNMENT CORPORATE
Government Corporate Counsel) are obtained.3
COUNSEL, respondents.

Pending the declaration of Renong Berhad as the winning

bidder/strategic partner and the execution of the necessary
contracts, petitioner in a letter to respondent GSIS dated 28
BELLOSILLO, J.: September 1995 matched the bid price of P44.00 per share
tendered by Renong Berhad.4 In a subsequent letter dated 10
The FiIipino First Policy enshrined in the 1987 October 1995 petitioner sent a manager's check issued by
Constitution, i.e., in the grant of rights, privileges, and Philtrust Bank for Thirty-three Million Pesos (P33.000.000.00)
concessions covering the national economy and patrimony, the as Bid Security to match the bid of the Malaysian Group,
State shall give preference to qualified Filipinos,1 is in oked by Messrs. Renong Berhad . . .5 which respondent GSIS refused to
petitioner in its bid to acquire 51% of the shares of the Manila accept.
Hotel Corporation (MHC) which owns the historic Manila Hotel.
Opposing, respondents maintain that the provision is not self- On 17 October 1995, perhaps apprehensive that respondent
executing but requires an implementing legislation for its GSIS has disregarded the tender of the matching bid and that the
enforcement. Corollarily, they ask whether the 51% shares form sale of 51% of the MHC may be hastened by respondent GSIS
and consummated with Renong Berhad, petitioner came to this
Court on prohibition and mandamus. On 18 October 1995 the Fourth, the reliance by petitioner on par. V., subpar. J. 1., of the
Court issued a temporary restraining order enjoining respondents bidding rules which provides that if for any reason, the Highest
from perfecting and consummating the sale to the Malaysian Bidder cannot be awarded the Block of Shares, GSIS may offer
firm. this to the other Qualified Bidders that have validly submitted
bids provided that these Qualified Bidders are willing to match
On 10 September 1996 the instant case was accepted by the the highest bid in terms of price per share, is misplaced.
Court En Banc after it was referred to it by the First Division. The Respondents postulate that the privilege of submitting a matching
case was then set for oral arguments with former Chief Justice bid has not yet arisen since it only takes place if for any reason,
Enrique M. Fernando and Fr. Joaquin G. Bernas, S.J., as amici the Highest Bidder cannot be awarded the Block of Shares. Thus
curiae. the submission by petitioner of a matching bid is premature since
Renong Berhad could still very well be awarded the block of
shares and the condition giving rise to the exercise of the
In the main, petitioner invokes Sec. 10, second par., Art. XII, of privilege to submit a matching bid had not yet taken place.
the 1987 Constitution and submits that the Manila Hotel has
been identified with the Filipino nation and has practically
become a historical monument which reflects the vibrancy of Finally, the prayer for prohibition grounded on grave abuse of
Philippine heritage and culture. It is a proud legacy of an earlier discretion should fail since respondent GSIS did not exercise its
generation of Filipinos who believed in the nobility and discretion in a capricious, whimsical manner, and if ever it did
sacredness of independence and its power and capacity to abuse its discretion it was not so patent and gross as to amount
release the full potential of the Filipino people. To all intents and to an evasion of a positive duty or a virtual refusal to perform a
purposes, it has become a part of the national duty enjoined by law. Similarly, the petition for mandamus should
patrimony.6 Petitioner also argues that since 51% of the shares of fail as petitioner has no clear legal right to what it demands and
the MHC carries with it the ownership of the business of the hotel respondents do not have an imperative duty to perform the act
which is owned by respondent GSIS, a government-owned and required of them by petitioner.
controlled corporation, the hotel business of respondent GSIS
being a part of the tourism industry is unquestionably a part of We now resolve. A constitution is a system of fundamental laws
the national economy. Thus, any transaction involving 51% of the for the governance and administration of a nation. It is supreme,
shares of stock of the MHC is clearly covered by the imperious, absolute and unalterable except by the authority from
term national economy, to which Sec. 10, second par., Art. XII, which it emanates. It has been defined as the fundamental and
1987 Constitution, applies.7 paramount law of the nation. 10 It prescribes the permanent
framework of a system of government, assigns to the different
It is also the thesis of petitioner that since Manila Hotel is part of departments their respective powers and duties, and establishes
the national patrimony and its business also unquestionably part certain fixed principles on which government is founded. The
of the national economy petitioner should be preferred after it has fundamental conception in other words is that it is a supreme law
matched the bid offer of the Malaysian firm. For the bidding rules to which all other laws must conform and in accordance with
mandate that if for any reason, the Highest Bidder cannot be which all private rights must be determined and all public
awarded the Block of Shares, GSIS may offer this to the other authority administered. 11 Under the doctrine of constitutional
Qualified Bidders that have validly submitted bids provided that supremacy, if a law or contract violates any norm of the
these Qualified Bidders are willing to match the highest bid in constitution that law or contract whether promulgated by the
terms of price per share.8 legislative or by the executive branch or entered into by private
persons for private purposes is null and void and without any
force and effect. Thus, since the Constitution is the fundamental,
Respondents except. They maintain that: First, Sec. 10, second paramount and supreme law of the nation, it is deemed written in
par., Art. XII, of the 1987 Constitution is merely a statement of every statute and contract.
principle and policy since it is not a self-executing provision and
requires implementing legislation(s) . . . Thus, for the said
provision to Operate, there must be existing laws "to lay down Admittedly, some constitutions are merely declarations of policies
conditions under which business may be done."9 and principles. Their provisions command the legislature to enact
laws and carry out the purposes of the framers who merely
establish an outline of government providing for the different
Second, granting that this provision is self-executing, Manila departments of the governmental machinery and securing certain
Hotel does not fall under the term national patrimony which only fundamental and inalienable rights of citizens. 12 A provision
refers to lands of the public domain, waters, minerals, coal, which lays down a general principle, such as those found in Art. II
petroleum and other mineral oils, all forces of potential energy, of the 1987 Constitution, is usually not self-executing. But a
fisheries, forests or timber, wildlife, flora and fauna and all marine provision which is complete in itself and becomes operative
wealth in its territorial sea, and exclusive marine zone as cited in without the aid of supplementary or enabling legislation, or that
the first and second paragraphs of Sec. 2, Art. XII, 1987 which supplies sufficient rule by means of which the right it grants
Constitution. According to respondents, while petitioner speaks of may be enjoyed or protected, is self-executing. Thus a
the guests who have slept in the hotel and the events that have constitutional provision is self-executing if the nature and extent
transpired therein which make the hotel historic, these alone do of the right conferred and the liability imposed are fixed by the
not make the hotel fall under the patrimony of the nation. What is constitution itself, so that they can be determined by an
more, the mandate of the Constitution is addressed to the State, examination and construction of its terms, and there is no
not to respondent GSIS which possesses a personality of its own language indicating that the subject is referred to the legislature
separate and distinct from the Philippines as a State. for action. 13

Third, granting that the Manila Hotel forms part of the national As against constitutions of the past, modern constitutions have
patrimony, the constitutional provision invoked is still inapplicable been generally drafted upon a different principle and have often
since what is being sold is only 51% of the outstanding shares of become in effect extensive codes of laws intended to operate
the corporation, not the hotel building nor the land upon which directly upon the people in a manner similar to that of statutory
the building stands. Certainly, 51% of the equity of the MHC enactments, and the function of constitutional conventions has
cannot be considered part of the national patrimony. Moreover, if evolved into one more like that of a legislative body. Hence,
the disposition of the shares of the MHC is really contrary to the unless it is expressly provided that a legislative act is necessary
Constitution, petitioner should have questioned it right from the to enforce a constitutional mandate, the presumption now is that
beginning and not after it had lost in the bidding. all provisions of the constitution are self-executing If the
constitutional provisions are treated as requiring legislation render such a provision ineffective in the absence of such
instead of self-executing, the legislature would have the power to legislation. The omission from a constitution of any express
ignore and practically nullify the mandate of the fundamental provision for a remedy for enforcing a right or liability is not
law.14 This can be cataclysmic. That is why the prevailing view is, necessarily an indication that it was not intended to be self-
as it has always been, that — executing. The rule is that a self-executing provision of the
constitution does not necessarily exhaust legislative power on the
. . . in case of doubt, the Constitution should be subject, but any legislation must be in harmony with the
considered self-executing rather than non-self-executing constitution, further the exercise of constitutional right and make
. . . . Unless the contrary is clearly intended, the it more available. 17 Subsequent legislation however does not
provisions of the Constitution should be considered self- necessarily mean that the subject constitutional provision is not,
executing, as a contrary rule would give the legislature by itself, fully enforceable.
discretion to determine when, or whether, they shall be
effective. These provisions would be subordinated to the Respondents also argue that the non-self-executing nature of
will of the lawmaking body, which could make them Sec. 10, second par., of Art. XII is implied from the tenor of the
entirely meaningless by simply refusing to pass the first and third paragraphs of the same section which undoubtedly
needed implementing statute. 15 are not self-executing. 18 The argument is flawed. If the first and
third paragraphs are not self-executing because Congress is still
Respondents argue that Sec. 10, second par., Art. XII, of the to enact measures to encourage the formation and operation of
1987 Constitution is clearly not self-executing, as they quote from enterprises fully owned by Filipinos, as in the first paragraph, and
discussions on the floor of the 1986 Constitutional Commission the State still needs legislation to regulate and exercise authority
— over foreign investments within its national jurisdiction, as in the
third paragraph, then a fortiori, by the same logic, the second
paragraph can only be self-executing as it does not by its
MR. RODRIGO. Madam President, I am asking language require any legislation in order to give preference to
this question as the Chairman of the qualified Filipinos in the grant of rights, privileges and
Committee on Style. If the wording of concessions covering the national economy and patrimony. A
"PREFERENCE" is given to QUALIFIED constitutional provision may be self-executing in one part and
FILIPINOS," can it be understood as a non-self-executing in another. 19
preference to qualified Filipinos vis-a-
vis Filipinos who are not qualified. So, why do
we not make it clear? To qualified Filipinos as Even the cases cited by respondents holding that certain
against aliens? constitutional provisions are merely statements of principles and
policies, which are basically not self-executing and only placed in
the Constitution as moral incentives to legislation, not as judicially
THE PRESIDENT. What is the question of enforceable rights — are simply not in point. Basco v. Philippine
Commissioner Rodrigo? Is it to remove the Amusements and Gaming Corporation 20 speaks of constitutional
word "QUALIFIED?". provisions on personal dignity, 21 the sanctity of family life, 22 the
vital role of the youth in nation-building 23 the promotion of social
MR. RODRIGO. No, no, but say definitely "TO justice, 24 and the values of education. 25 Tolentino v. Secretary of
QUALIFIED FILIPINOS" as against whom? As Finance 26 refers to the constitutional provisions on social justice
against aliens or over aliens? and human rights 27 and on education. 28 Lastly, Kilosbayan,
Inc. v. Morato 29 cites provisions on the promotion of general
MR. NOLLEDO. Madam President, I think that is welfare, 30 the sanctity of family life, 31 the vital role of the youth in
understood. We use the word "QUALIFIED" because nation-building 32 and the promotion of total human liberation and
the existing laws or prospective laws will always lay development. 33A reading of these provisions indeed clearly
down conditions under which business may be shows that they are not judicially enforceable constitutional rights
done. For example, qualifications on the setting up of but merely guidelines for legislation. The very terms of the
other financial structures, et cetera (emphasis supplied provisions manifest that they are only principles upon which the
by respondents) legislations must be based. Res ipsa loquitur.

MR. RODRIGO. It is just a matter of style. On the other hand, Sec. 10, second par., Art. XII of the of the
1987 Constitution is a mandatory, positive command which is
complete in itself and which needs no further guidelines or
MR. NOLLEDO Yes, 16 implementing laws or rules for its enforcement. From its very
words the provision does not require any legislation to put it in
Quite apparently, Sec. 10, second par., of Art XII is couched in operation. It is per se judicially enforceable When our
such a way as not to make it appear that it is non-self-executing Constitution mandates that [i]n the grant of rights, privileges, and
but simply for purposes of style. But, certainly, the legislature is concessions covering national economy and patrimony, the State
not precluded from enacting other further laws to enforce the shall give preference to qualified Filipinos, it means just that —
constitutional provision so long as the contemplated statute qualified Filipinos shall be preferred. And when our Constitution
squares with the Constitution. Minor details may be left to the declares that a right exists in certain specified circumstances an
legislature without impairing the self-executing nature of action may be maintained to enforce such right notwithstanding
constitutional provisions. the absence of any legislation on the subject; consequently, if
there is no statute especially enacted to enforce such
constitutional right, such right enforces itself by its own inherent
In self-executing constitutional provisions, the legislature may still
potency and puissance, and from which all legislations must take
enact legislation to facilitate the exercise of powers directly
their bearings. Where there is a right there is a remedy. Ubi jus
granted by the constitution, further the operation of such a
ibi remedium.
provision, prescribe a practice to be used for its enforcement,
provide a convenient remedy for the protection of the rights
secured or the determination thereof, or place reasonable As regards our national patrimony, a member of the 1986
safeguards around the exercise of the right. The mere fact that Constitutional Commission 34 explains —
legislation may supplement and add to or prescribe a penalty for
the violation of a self-executing constitutional provision does not
 The patrimony of the Nation that should be conserved ASSOCIATIONS WHOSE CAPITAL OR
and developed refers not only to out rich natural CONTROLLING STOCK IS WHOLLY OWNED BY
resources but also to the cultural heritage of out race. It SUCH CITIZENS.
also refers to our intelligence in arts, sciences and
letters. Therefore, we should develop not only our lands, xxx xxx
forests, mines and other natural resources but also the
mental ability or faculty of our people.
MR. MONSOD. Madam President, apparently the
proponent is agreeable, but we have to raise a question.
We agree. In its plain and ordinary meaning, the term patrimony Suppose it is a corporation that is 80-percent Filipino, do
pertains to heritage. 35 When the Constitution speaks of national we not give it preference?
patrimony, it refers not only to the natural resources of the
Philippines, as the Constitution could have very well used the
term natural resources, but also to the cultural heritage of the MR. DAVIDE. The Nolledo amendment would refer to
Filipinos. an individual Filipino. What about a corporation wholly
owned by Filipino citizens?
Manila Hotel has become a landmark — a living testimonial of
Philippine heritage. While it was restrictively an American hotel MR. MONSOD. At least 60 percent, Madam President.
when it first opened in 1912, it immediately evolved to be truly
Filipino, Formerly a concourse for the elite, it has since then MR. DAVIDE. Is that the intention?
become the venue of various significant events which have
shaped Philippine history. It was called the Cultural Center of the MR. MONSOD. Yes, because, in fact, we would be
1930's. It was the site of the festivities during the inauguration of limiting it if we say that the preference should only be
the Philippine Commonwealth. Dubbed as the Official Guest 100-percent Filipino.
House of the Philippine Government. it plays host to dignitaries
and official visitors who are accorded the traditional Philippine
hospitality. 36 MR: DAVIDE. I want to get that meaning clear because
"QUALIFIED FILIPINOS" may refer only to individuals
and not to juridical personalities or entities.
The history of the hotel has been chronicled in the book The
Manila Hotel: The Heart and Memory of a City. 37During World
War II the hotel was converted by the Japanese Military MR. MONSOD. We agree, Madam President. 39
Administration into a military headquarters. When the American
forces returned to recapture Manila the hotel was selected by the xxx xxx xxx
Japanese together with Intramuros as the two (2) places fro their
final stand. Thereafter, in the 1950's and 1960's, the hotel
MR. RODRIGO. Before we vote, may I request that the
became the center of political activities, playing host to almost
amendment be read again.
every political convention. In 1970 the hotel reopened after a
renovation and reaped numerous international recognitions, an
acknowledgment of the Filipino talent and ingenuity. In 1986 the MR. NOLLEDO. The amendment will read: "IN THE
hotel was the site of a failed coup d' etat where an aspirant for GRANT OF RIGHTS, PRIVILEGES AND
vice-president was "proclaimed" President of the Philippine CONCESSIONS COVERING THE NATIONAL
Republic. ECONOMY AND PATRIMONY, THE STATE SHALL
GIVE PREFERENCE TO QUALIFIED FILIPINOS." And
the word "Filipinos" here, as intended by the
For more than eight (8) decades Manila Hotel has bore mute
proponents, will include not only individual Filipinos but
witness to the triumphs and failures, loves and frustrations of the
also Filipino-controlled entities or entities fully-controlled
Filipinos; its existence is impressed with public interest; its own
by Filipinos. 40
historicity associated with our struggle for sovereignty,
independence and nationhood. Verily, Manila Hotel has become
part of our national economy and patrimony. For sure, The phrase
51% preference to qualified Filipinos was explained thus —
of the
equity of the MHC comes within the purview of the constitutional
shelter for it comprises the majority and controlling stock, so that MR. FOZ. Madam President, I would like to request
anyone who acquires or owns the 51% will have actual control Commissioner Nolledo to please restate his amendment
and management of the hotel. In this instance, 51% of the MHC so that I can ask a question.
cannot be disassociated from the hotel and the land on which the
hotel edifice stands. Consequently, we cannot sustain
MR. NOLLEDO. "IN THE GRANT OF RIGHTS,
respondents' claim that the Filipino First Policy provision is not
PRIVILEGES AND CONCESSIONS COVERING THE
applicable since what is being sold is only 51% of
NATIONAL ECONOMY AND PATRIMONY, THE STATE
the outstanding shares of the corporation, not the Hotel building
38 SHALL GIVE PREFERENCE TO QUALIFIED
nor the land upon which the building stands.
FILIPINOS."

The argument is pure sophistry. The term qualified Filipinos as

MR FOZ. In connection with that amendment, if a
used in Our Constitution also includes corporations at least 60%
foreign enterprise is qualified and a Filipino enterprise is
of which is owned by Filipinos. This is very clear from the
also qualified, will the Filipino enterprise still be given a
proceedings of the 1986 Constitutional Commission
preference?

THE PRESIDENT. Commissioner Davide is recognized.

MR. NOLLEDO. Obviously.

MR. DAVIDE. I would like to introduce an amendment to

MR. FOZ. If the foreigner is more qualified in some
the Nolledo amendment. And the amendment would
aspects than the Filipino enterprise, will the Filipino still
consist in substituting the words "QUALIFIED
be preferred?
FILIPINOS" with the following: "CITIZENS OF THE
PHILIPPINES OR CORPORATIONS OR
MR. NOLLEDO. The answer is "yes."
 MR. FOZ. Thank you, 41 an interpretation every time the executive is confronted
by a constitutional command. That is not how
Expounding further on the Filipino First Policy provision constitutional government operates. 45
Commissioner Nolledo continues —
Respondents further argue that the constitutional provision is
MR. NOLLEDO. Yes, Madam President. Instead of addressed to the State, not to respondent GSIS which by itself
"MUST," it will be "SHALL — THE STATE SHALL GlVE possesses a separate and distinct personality. This argument
PREFERENCE TO QUALIFIED FILIPINOS. This again is at best specious. It is undisputed that the sale of 51% of
embodies the so-called "Filipino First" policy. That the MHC could only be carried out with the prior approval of the
means that Filipinos should be given preference in the State acting through respondent Committee on Privatization. As
grant of concessions, privileges and rights covering the correctly pointed out by Fr. Joaquin G. Bernas, S.J., this fact
national patrimony. 42 alone makes the sale of the assets of respondents GSIS and
MHC a "state action." In constitutional jurisprudence, the acts of
persons distinct from the government are considered "state
The exchange of views in the sessions of the Constitutional action" covered by the Constitution (1) when the activity it
Commission regarding the subject provision was still further engages in is a "public function;" (2) when the government is so
clarified by Commissioner Nolledo 43 — significantly involved with the private actor as to make the
government responsible for his action; and, (3) when the
Paragraph 2 of Section 10 explicitly mandates the "Pro- government has approved or authorized the action. It is evident
Filipino" bias in all economic concerns. It is better that the act of respondent GSIS in selling 51% of its share in
known as the FILIPINO FIRST Policy . . . This provision respondent MHC comes under the second and third categories of
was never found in previous Constitutions . . . . "state action." Without doubt therefore the transaction. although
entered into by respondent GSIS, is in fact a transaction of the
The term "qualified Filipinos" simply means that State and therefore subject to the constitutional command. 46
preference shall be given to those citizens who can
make a viable contribution to the common good, When the Constitution addresses the State it refers not only to
because of credible competence and efficiency. It the people but also to the government as elements of the State.
certainly does NOT mandate the pampering and After all, government is composed of three (3) divisions of power
preferential treatment to Filipino citizens or — legislative, executive and judicial. Accordingly, a constitutional
organizations that are incompetent or inefficient, since mandate directed to the State is correspondingly directed to the
such an indiscriminate preference would be counter three(3) branches of government. It is undeniable that in this
productive and inimical to the common good. case the subject constitutional injunction is addressed among
others to the Executive Department and respondent GSIS, a
In the granting of economic rights, privileges, and government instrumentality deriving its authority from the State.
concessions, when a choice has to be made between a
"qualified foreigner" end a "qualified Filipino," the latter It should be stressed that while the Malaysian firm offered the
shall be chosen over the former." higher bid it is not yet the winning bidder. The bidding rules
expressly provide that the highest bidder shall only be declared
Lastly, the word qualified is also determinable. Petitioner was so the winning bidder after it has negotiated and executed the
considered by respondent GSIS and selected as one of necessary contracts, and secured the requisite approvals. Since
the qualified bidders. It was pre-qualified by respondent GSIS in the "Filipino First Policy provision of the Constitution bestows
accordance with its own guidelines so that the sole inference preference on qualified Filipinos the mere tending of the highest
here is that petitioner has been found to be possessed of proven bid is not an assurance that the highest bidder will be declared
management expertise in the hotel industry, or it has significant the winning bidder. Resultantly, respondents are not bound to
equity ownership in another hotel company, or it has an overall make the award yet, nor are they under obligation to enter into
management and marketing proficiency to successfully operate one with the highest bidder. For in choosing the awardee
the Manila Hotel. 44 respondents are mandated to abide by the dictates of the 1987
Constitution the provisions of which are presumed to be known to
all the bidders and other interested parties.
The penchant to try to whittle away the mandate of the
Constitution by arguing that the subject provision is not self-
executory and requires implementing legislation is quite Adhering to the doctrine of constitutional supremacy, the subject
disturbing. The attempt to violate a clear constitutional provision constitutional provision is, as it should be, impliedly written in the
— by the government itself — is only too distressing. To adopt bidding rules issued by respondent GSIS, lest the bidding rules
such a line of reasoning is to renounce the duty to ensure be nullified for being violative of the Constitution. It is a basic
faithfulness to the Constitution. For, even some of the provisions principle in constitutional law that all laws and contracts must
of the Constitution which evidently need implementing legislation conform with the fundamental law of the land. Those which
have juridical life of their own and can be the source of a judicial violate the Constitution lose their reason for being.
remedy. We cannot simply afford the government a defense that
arises out of the failure to enact further enabling, implementing or Paragraph V. J. 1 of the bidding rules provides that [if] for any
guiding legislation. In fine, the discourse of Fr. Joaquin G. reason the Highest Bidder cannot be awarded the Block of
Bernas, S.J., on constitutional government is apt — Shares, GSIS may offer this to other Qualified Bidders that have
validly submitted bids provided that these Qualified Bidders are
The executive department has a constitutional duty to willing to match the highest bid in terms of price per
implement laws, including the Constitution, even before share. 47 Certainly, the constitutional mandate itself is reason
Congress acts — provided that there are discoverable enough not to award the block of shares immediately to the
legal standards for executive action. When the foreign bidder notwithstanding its submission of a higher, or even
executive acts, it must be guided by its own the highest, bid. In fact, we cannot conceive of a stronger reason
understanding of the constitutional command and of than the constitutional injunction itself.
applicable laws. The responsibility for reading and
understanding the Constitution and the laws is not the In the instant case, where a foreign firm submits the highest bid
sole prerogative of Congress. If it were, the executive in a public bidding concerning the grant of rights, privileges and
would have to ask Congress, or perhaps the Court, for concessions covering the national economy and patrimony,
thereby exceeding the bid of a Filipino, there is no question that the Court on this matter could have not been more appropriately
the Filipino will have to be allowed to match the bid of the foreign articulated by Chief Justice Narvasa —
entity. And if the Filipino matches the bid of a foreign firm the
award should go to the Filipino. It must be so if we are to give life As scrupulously as it has tried to observe that it
and meaning to the Filipino First Policy provision of the 1987 is not its function to substitute its judgment for
Constitution. For, while this may neither be expressly stated nor that of the legislature or the executive about
contemplated in the bidding rules, the constitutional fiat is, the wisdom and feasibility of legislation
omnipresent to be simply disregarded. To ignore it would be to economic in nature, the Supreme Court has
sanction a perilous skirting of the basic law. not been spared criticism for decisions
perceived as obstacles to economic progress
This Court does not discount the apprehension that this policy and development . . . in connection with a
may discourage foreign investors. But the Constitution and laws temporary injunction issued by the Court's First
of the Philippines are understood to be always open to public Division against the sale of the Manila Hotel to
scrutiny. These are given factors which investors must consider a Malaysian Firm and its partner, certain
when venturing into business in a foreign jurisdiction. Any person statements were published in a major daily to
therefore desiring to do business in the Philippines or with any of the effect that injunction "again demonstrates
its agencies or instrumentalities is presumed to know his rights that the Philippine legal system can be a major
and obligations under the Constitution and the laws of the forum. obstacle to doing business here.

The argument of respondents that petitioner is now estopped Let it be stated for the record once again that
from questioning the sale to Renong Berhad since petitioner was while it is no business of the Court to intervene
well aware from the beginning that a foreigner could participate in in contracts of the kind referred to or set itself
the bidding is meritless. Undoubtedly, Filipinos and foreigners up as the judge of whether they are viable or
alike were invited to the bidding. But foreigners may be awarded attainable, it is its bounden duty to make sure
the sale only if no Filipino qualifies, or if the qualified Filipino fails that they do not violate the Constitution or the
to match the highest bid tendered by the foreign entity. In the laws, or are not adopted or implemented with
case before us, while petitioner was already preferred at the grave abuse of discretion amounting to lack or
inception of the bidding because of the constitutional mandate, excess of jurisdiction. It will never shirk that
petitioner had not yet matched the bid offered by Renong duty, no matter how buffeted by winds of unfair
Berhad. Thus it did not have the right or personality then to and ill-informed criticism. 48
compel respondent GSIS to accept its earlier bid. Rightly, only
after it had matched the bid of the foreign firm and the apparent Privatization of a business asset for purposes of enhancing its
disregard by respondent GSIS of petitioner's matching bid did the business viability and preventing further losses, regardless of the
latter have a cause of action. character of the asset, should not take precedence over non-
material values. A commercial, nay even a budgetary, objective
Besides, there is no time frame for invoking the constitutional should not be pursued at the expense of national pride and
safeguard unless perhaps the award has been finally made. To dignity. For the Constitution enshrines higher and nobler non-
insist on selling the Manila Hotel to foreigners when there is a material values. Indeed, the Court will always defer to the
Filipino group willing to match the bid of the foreign group is to Constitution in the proper governance of a free society; after all,
insist that government be treated as any other ordinary market there is nothing so sacrosanct in any economic policy as to draw
player, and bound by its mistakes or gross errors of judgment, itself beyond judicial review when the Constitution is involved. 49
regardless of the consequences to the Filipino people. The
miscomprehension of the Constitution is regrettable. Thus we Nationalism is inherent, in the very concept of the Philippines
would rather remedy the indiscretion while there is still an being a democratic and republican state, with sovereignty
opportunity to do so than let the government develop the habit of residing in the Filipino people and from whom all government
forgetting that the Constitution lays down the basic conditions authority emanates. In nationalism, the happiness and welfare of
and parameters for its actions. the people must be the goal. The nation-state can have no higher
purpose. Any interpretation of any constitutional provision must
Since petitioner has already matched the bid price tendered by adhere to such basic concept. Protection of foreign investments,
Renong Berhad pursuant to the bidding rules, respondent GSIS while laudible, is merely a policy. It cannot override the demands
is left with no alternative but to award to petitioner the block of of nationalism. 50
shares of MHC and to execute the necessary agreements and
documents to effect the sale in accordance not only with the The Manila Hotel or, for that matter, 51% of the MHC, is not just
bidding guidelines and procedures but with the Constitution as any commodity to be sold to the highest bidder solely for the
well. The refusal of respondent GSIS to execute the sake of privatization. We are not talking about an ordinary piece
corresponding documents with petitioner as provided in the of property in a commercial district. We are talking about a
bidding rules after the latter has matched the bid of the historic relic that has hosted many of the most important events
Malaysian firm clearly constitutes grave abuse of discretion. in the short history of the Philippines as a nation. We are talking
about a hotel where heads of states would prefer to be housed
The Filipino First Policy is a product of Philippine nationalism. It is as a strong manifestation of their desire to cloak the dignity of the
embodied in the 1987 Constitution not merely to be used as a highest state function to their official visits to the Philippines.
guideline for future legislation but primarily to be enforced; so Thus the Manila Hotel has played and continues to play a
must it be enforced. This Court as the ultimate guardian of the significant role as an authentic repository of twentieth century
Constitution will never shun, under any reasonable circumstance, Philippine history and culture. In this sense, it has become truly a
the duty of upholding the majesty of the Constitution which it is reflection of the Filipino soul — a place with a history of
tasked to defend. It is worth emphasizing that it is not the grandeur; a most historical setting that has played a part in the
intention of this Court to impede and diminish, much less shaping of a country. 51
undermine, the influx of foreign investments. Far from it, the
Court encourages and welcomes more business opportunities This Court cannot extract rhyme nor reason from the determined
but avowedly sanctions the preference for Filipinos whenever efforts of respondents to sell the historical landmark —
such preference is ordained by the Constitution. The position of this Grand Old Dame of hotels in Asia — to a total stranger. For,
indeed, the conveyance of this epic exponent of the Filipino
psyche to alien hands cannot be less than mephistophelian for it
is, in whatever manner viewed, a veritable alienation of a nation's
soul for some pieces of foreign silver. And so we ask: What
advantage, which cannot be equally drawn from a qualified
Filipino, can be gained by the Filipinos Manila Hotel — and all
that it stands for — is sold to a non-Filipino? How much of
national pride will vanish if the nation's cultural heritage is
entrusted to a foreign entity? On the other hand, how much
dignity will be preserved and realized if the national patrimony is
safekept in the hands of a qualified, zealous and well-meaning
Filipino? This is the plain and simple meaning of the Filipino First
Policy provision of the Philippine Constitution. And this Court,
heeding the clarion call of the Constitution and accepting the duty
of being the elderly watchman of the nation, will continue to
respect and protect the sanctity of the Constitution.

WHEREFORE, respondents GOVERNMENT SERVICE

INSURANCE SYSTEM, MANILA HOTEL CORPORATION,
COMMITTEE ON PRIVATIZATION and OFFICE OF THE
GOVERNMENT CORPORATE COUNSEL are directed to
CEASE and DESIST from selling 51% of the shares of the Manila
Hotel Corporation to RENONG BERHAD, and to ACCEPT the
matching bid of petitioner MANILA PRINCE HOTEL
CORPORATION to purchase the subject 51% of the shares of
the Manila Hotel Corporation at P44.00 per share and thereafter
to execute the necessary clearances and to do such other acts
and deeds as may be necessary for purpose.

SO ORDERED.