Parayno vs Jovellanos

G.R. No. 148408

Subject: Public Corporation
Doctrine: Police power
Facts:
Petitioner was the owner of a gasoline filling station in Calasiao,
Pangasinan. In 1989, some residents of Calasiao petitioned the
Sangguniang Bayan (SB) of said municipality for the closure or
transfer of the station to another location. The matter was referred
to the Municipal Engineer, Chief of Police, Municipal Health
Officer and the Bureau of Fire Protection for investigation. Upon
their advise, the Sangguniang Bayan recommended to the Mayor
the closure or transfer of location of petitioner’s gasoline station.
In Resolution No. 50, it declared that the existing gasoline station
is a blatant violation and disregard of existing law.
According to the Resolution, 1) the gasoline filling station is in
violation of The Official Zoning Code of Calasiao, Art. 6, Section
44, the nearest school building which is San Miguel Elementary
School and church, the distances are less than 100 meters. (No
neighbors were called as witnesses when actual measurements
were done by HLURB Staff, Baguio City dated 22 June 1989); 2)
it remains in thickly populated area with commercial/residential
buildings, houses closed (sic) to each other which still endangers
the lives and safety of the people in case of fire; 3) residents of
our barangay always complain of the irritating smell of gasoline
most of the time especially during gas filling which tend to expose
residents to illness, and 4) It hampers the flow of traffic.
Petitioner moved for the reconsideration of the resolution but was
denied by the SB. Hence she filed a case before the RTC
claiming that the gasoline filling station was not covered under
Sec 44 of the mentioned law but is under Sec 21. Case was
denied by the court and by the CA. Hence this appeal.
ISSUE: Whether or not the closure/transfer of her gasoline filling
station by respondent municipality was an invalid exercise of the
latter’s police powers
HELD:
The respondent is barred from denying their previous claim that
the gasoline filling station is not under Sec 44. The Counsel in fact
admitted that : “That the business of the petitioner [was] one of a
gasoline filling station as defined in Article III, Section 21 of the
zoning code and not as a service station as differently defined
under Article 42 of the said official zoning code;”
The foregoing were judicial admissions which were conclusive on
the municipality, the party making them. hence, because of the
distinct and definite meanings alluded to the two terms by the
zoning ordinance, respondents could not insist that “gasoline
service station” under Section 44 necessarily included “gasoline
filling station” under Section 21. Indeed, the activities undertaken
in a “gas service station” did not automatically embrace those in a
“gas filling station.”
As for the main issue, the court held that the respondent
municipality invalidly used its police powers in ordering the
closure/transfer of petitioner’s gasoline station. While it had, under
RA 7160, the power to take actions and enact measures to
promote the health and general welfare of its constituents, it
should have given due deference to the law and the rights of
petitioner.
A local government is considered to have properly exercised its
police powers only when the following requisites are met: (1) the
interests of the public generally, as distinguished from those of a
particular class, require the interference of the State and (2) the
means employed are reasonably necessary for the attainment of
the object sought to be accomplished and not unduly oppressive.
The first requirement refers to the equal protection clause and the
second, to the due process clause of the Constitution.
Respondent municipality failed to comply with the due process
clause when it passed Resolution No. 50. While it maintained that
the gasoline filling station of petitioner was less than 100 meters
from the nearest public school and church, the records do not
show that it even attempted to measure the distance,
notwithstanding that such distance was crucial in determining
whether there was an actual violation of Section 44. The different
local offices that respondent municipality tapped to conduct an
investigation never conducted such measurement either.
Moreover, petitioner’s business could not be considered a
nuisance which respondent municipality could summarily abate in
the guise of exercising its police powers. The abatement of a
nuisance without judicial proceedings is possible only if it is a
nuisance per se. A gas station is not a nuisance per se or one
affecting the immediate safety of persons and property, hence, it
cannot be closed down or transferred summarily to another
location.
On the alleged hazardous effects of the gasoline station to the
lives and properties of the people of Calasiao, we again note:
“Hence, the Board is inclined to believe that the project being
hazardous to life and property is more perceived than factual. For,
after all, even the Fire Station Commander.. recommended “to
build such buildings after conform (sic) all the requirements of PP
1185.” It is further alleged by the complainants that the proposed
location is “in the heart of the thickly populated residential area of
Calasiao.” Again, findings of the [HLURB] staff negate the
allegations as the same is within a designated
Business/Commercial Zone per the Zoning Ordinance.
WHEREFORE, the petition is hereby GRANTED. The assailed
resolution of the Court of the Appeals is REVERSED and SET
ASIDE. Respondent Municipality of Calasiao is hereby directed to
cease and desist from enforcing Resolution No. 50 against
petitioner insofar as it seeks to close down or transfer her
gasoline station to another location.
Ochosa vs Alano and Republic, G.R.
167459
Jose Reynaldo B. Ochosa, petitioner vs
Bona J. Alano and Republic of the Philippines,
respondents
G.R. No. 167459, January 26, 2011
Facts:
Bona’s illicit affairs with other men started at the onset of their
marriage on October 27, 1973, when Jose was assigned in various
parts of the country as an officer in the AFP. She continued her
infidelity even when they lived together at Fort Bonifacio, Makati
City sometime in 1985, whenever Jose was out of their living
quarters.

In 1987, Jose was incarcerated in Camp Crame for rebellion for

the alleged participation of the failed coup d’etat. He heard
circulation of rumors of Bona getting caught having sex with his
driver, Corporal Gagarin.

He got a military pass from his jail warden and confronted Bona
about the rumors, which she and Gagarin admitted. Since then
they were separated, and their foundling, Ramona Celeste,
stayed with Bona in Basilan until 1994 to live with Jose.

Jose Reynaldo B. Ochosa filed a Petition for the declaration of

nullity of marriage between him and Bona J. Alano, based on the
ground of the latter’s psychological incapacity to fulfill the
essential marital obligations of marriage.

Elizabeth E. Rondain, a psychiatrist, one of the witnesses,

testified and submitted a psychological evaluation report on
Bona’s mental state. The interviews she had with Jose and two of
his witnesses brought her to the conclusion that respondent was
suffering from histrionic personality disorder, and it was
traceable to her family history.
On January 11, 1999, the dispositive portion of the trial court
declared the marriage of Jose and Bona void ab initio on the
ground of psychological incapacity of the respondent under
Article 36 of the Family Code. The Court finds that Bona’s illness
exhibited gravity, antecedence, and incurability.

OSG appealed the said ruling to the CA, and the CA subsequently
granted the appeal and reversed the ruling of the trial court
decision.

Issue:
Whether or not Bona should be deemed psychologically
incapacitated to comply with the essential marital obligations.

Ruling:
No. There is inadequate credible evidence that her defects were
already present at the inception of, or prior to, the marriage.
Bona’s alleged psychological incapacity did not satisfy the
jurisprudential requisite of “juridical antecedence”. Her
persistent sexual infidelity and abandonment are not badges of
psychological incapacity nor can’t it be traced to the inception of
their marriage.

The psychiatrist’s conclusion about Bona’s HPD which made her

prone to promiscuity and sexual infidelity existed before her
marriage to Jose, cannot be taken as credible proof of
antecedence since the method by which such an inference was
reached leaves much to be desired in terms of meeting the
standard of evidence required in determining psychological
incapacity.
Dr. Rondain’s conclusion was based solely on the assumed truthful
knowledge of Jose. No other witness testified to Bona’s family
history or her behavior prior to or at the beginning of their
marriage. The two witnesses only started to live with them in
1980 and 1986, respectively.

Verily, Dr. Rondain evaluated Bona’s psychological condition

directly from the information gathered solely from Jose and his
witnesses. These factual circumstances evoke the possibility that
the information fed to the psychiatrists is tainted with bias for
Jose’s cause, in the absence of sufficient corroboration.

Article 36 of the Family Code is not to be confused with a divorce

law that cuts the marital bond at the time the causes therefore
manifest themselves. It refers to a serious psychological illness
afflicting a party even before the celebration of the marriage. It
is a malady so grave and so permanent as to deprive one of
awareness of the duties and responsibilities of the matrimonial
bond one is about to assume. These marital obligations are those
provided under Article 68 to 71, 220, 221 and 225 of the Family
Code.

G.R. No. L-19650

Caltex Philippines, Inc., petitioner-appellee
Vs.
Enrico Palomar, in his capacity as The Postmaster General,
respondent-appellant
Click Here for the Full Text of the case
FACTS:
In the year 1960, Caltex Philippines conceived and laid the
ground work for a promotional scheme calculated to drum up
patronage for its oil products. The contest was entitled “Caltex
Hooded Pump Contest”, which calls for participants to estimate the
actual number of liters as hooded gas pump at each Caltex station
will dispense during a specific period.
Foreseeing the extensive use of the mails not only as
amongst the media for publicizing the contest but also for the
transmission of communications, representations were made by
Caltex with the postal authorities for the contest to be cleared in
advance for mailing. This was formalized in a letter sent by Caltex
to the Post master General, dated October 31, 1960, in which
Caltex, thru its counsel, enclosed a copy of the contest rules and
endeavored to justify its position that the contest does not violate
the “The Anti-Lottery Provisions of the Postal Law”.
Unfortunately, the Palomar, the acting Postmaster General
denied Caltex’s request stating that the contest scheme falls within
the purview of the Anti-lottery Provision and ultimately, declined
Clatex’s request for clearance.
Caltex sought reconsideration, stressing that there being no
consideration involved in part of the contestant, the contest was not
commendable as a lottery. However, the Postmaster General
maintained his view that the contest involves consideration, or even
it does not involve any consideration it still falls as “Gift Enterprise”,
which was equally banned by the Postal Law.
ISSUE:
1 Whether the petition states a sufficient cause of action for
declaratory relief?
2 Whether or not the scheme proposed by Caltex the appellee
is within the coverage of the prohibitive provisions of the
Postal Law?
HELD:
I.
By express mandate of Section 1 of Rule 66 of the old Rules of
Court which deals with the applicability to invoke declaratory relief
which states: “Declaratory relief is available to person whose
rights are affected by a statute, to determine any question of
construction or validity arising under the statute and for a
declaration of rights thereunder.
In amplification, conformably established jurisprudence on the
matter, laid down certain conditions:
1 There must be a justiciable controversy.
2 The controversy must be between persons whose interests
are adverse.
3 The party seeking declaratory relief must have a legal interest
in the controversy.
4 The issue involved must be ripe for judicial determination.
With the appellee’s bent to hold the contest and the appellant’s
threat to issue a fraud order if carried out, the contenders are
confronted by an ominous shadow of imminent and inevitable
litigation unless their differences are settled and stabilized by a
declaration. And, contrary to the insinuation of the appellant, the
time is long past when it can rightly be said that merely the
appellee’s “desires are thwarted by its own doubts, or by the fears
of others” — which admittedly does not confer a cause of action.
Doubt, if any there was, has ripened into a justiciable controversy
when, as in the case at bar, it was translated into a positive claim
of right which is actually contested.

EN BANC
[ GR No. 162372, Sep 11, 2012 ]
GOVERNMENT SERVICE INSURANCE SYSTEM v.
COA +
 RESOLUTION
G.R. No. 162372

LEONARDO-DE CASTRO, J.:

Romeo C. Quilatan, in his capacity as one of the
petitioners in GSIS, et al. v. Commission on Audit, et al.,
and in representation of his fellow Government Service
Insurance System (GSIS) officers and employees who
retired under the GSIS RFP (Retirement/Financial Plan),
filed a Motion for Clarification and
Reconsideration dated November 7, 2011, and a
Manifestation to Supplement the Motion for Clarification
and Reconsideration dated January 20, 2012, of this
Court's October 11, 2011 Decision in the said case. On
May 17, 2012, Quilatan filed a Final Memorandum
and Summary of Arguments, which he followed-up
on August 28, 2012, with another Manifestation to
Supplement [the] Final Memorandum and
Summary of Arguments.

On November 11, 2011, Federico Pascual, Daniel N.

Mijares, Elvira U. Geronimo, Aurora P. Mathay, Manuel
P. Bausa, Rustico G. Delos Angeles, Lourdes Delos
Angeles, Sonia S. Sindac, Marina Santamaria, the Estate
of Lourdes G. Patag represented by Napolen Patag, and
Vicente Villegas (Movants Federico Pascual, et al.), who
are some of the payees named in the decision, filed an
Entry of Appearance with Motion for Leave of
Court to Admit the Motion for Clarification filed
on the same day. The Movants Federico Pascual, et al.
later on furnished Quilatan a copy of this Motion, as per
their Compliance/Manifestation dated July 20, 2012,
which this Court notes.

On February 22, 2012, Quilatan filed a Manifestation and

Motion to Defer Execution of Judgment, alleging that
GSIS, the main petitioner in the case, which no longer
contested this Court's October 11, 2011 Decision, had
started to send out demand letters from the payees,
asking them to refund the amounts they had received as
retirement benefits under the GSIS RFP.

In his Manifestations, Memorandum, and Motion for

Clarification and Reconsideration of this Court's October
11, 2011 Decision, Quilatan raises several grounds, all of
which were already addressed in said Decision. Movants
Federico Pascual, et al., however, raised in their Motion
for Clarification, a new issue, which this Court will
address, to wit:

Whether or not the payees should be compelled to

return the retirement benefits they had received
under the GSIS RFP.

In essence, the Movants Federico Pascual, et al. are

asking this Court to reconsider our Decision in so far as
their liability, as the payees, to return the benefits they
had already received, by applying our rulings in Molen,
Jr. v. Commission on Audit,[1] De Jesus v. Commission
on Audit,[2] Magno v. Commission on Audit,[3] Baybay
Water District v. Commission on Audit,[4] Barbo v.
Commission on Audit,[5] Bases Conversion and
Development Authority v. Commission on Audit,[6]
among others, wherein, despite this Court's disapproval
of the allowances and/or benefits the payees therein
received, for being contrary to the law applicable in those
cases, this Court did not require such payees to refund
the monies they had received in good faith. On April 11,
2012, the public respondents, through the Office of the
Solicitor General, commented and agreed with the
Movants Federico Pascual, et al. that it would be an
injustice if they were ordered to refund the retirement
benefits they had received more than a decade ago.

The Court notes the Comment filed by the GSIS on July

13, 2012, in compliance with our March 13, 2012
Resolution, where GSIS states that since it did not move
for the reconsideration of this Court's October 11, 2011
Decision, it was bound by such decision. As far as it was
concerned, the said decision became final after the lapse
of fifteen days from receipt of said Decision on October
21, 2011. GSIS adds that since it already conceded that it
had no power to adopt the GSIS RFP, and decided to
accept the notices of disallowance, it had no reason to
continue disregarding such notices, the implementation
of which was never enjoined.

As for Quilatan, GSIS claims that he has no legal

standing to represent the payees as he has no interest in
the main controversy, i.e., the power of GSIS to adopt the
RFP, and because he was not prejudiced by the decision
on the case. Moreover, the GSIS avers, Quilatan had
already retired from the GSIS; thus, he cannot represent
it and argue its case before this Court.

Anent the payees, some of whom are the Movants now

before us, the GSIS posits that they did not timely
intervene in this case despite knowledge of its pendency
before this Court, which lasted for almost eight years.
According to the GSIS, giving due course to the motions
would allow a form of intervention by persons who were
not parties to the case after the opportunity for them to
do so had lapsed.

The Court finds merit in the aforesaid position of the

GSIS. Quilatan's Motion for Clarification and
Reconsideration and the Movants Federico Pascual, et
al.'s Motion for Clarification, which in effect seeks a
reconsideration of the Court's Decision dated October 11,
2011, should be denied for lack of the Movants' legal
standing to question the said Decision.

Furthermore, even if the substantive issues and

arguments raised by the Movants Federico Pascual, et al.
are considered, there is no justifiable ground to reverse
the Court's Decision. While it is true, as claimed by the
Movants Federico Pascual, et al., that based on
prevailing jurisprudence, disallowed benefits received in
good faith need not be refunded, the case before us may
be distinguished from all the cases cited by Movants
Federico Pascual, et al. because the monies involved here
are retirement benefits.

Retirement benefits belong to a different class of

benefits. All the cases cited by the Movants Federico
Pascual, et al. involved benefits such as cash gifts,
representation allowances, rice subsidies, uniform
allowances, per diems, transportation allowances, and
the like. The foregoing allowances or fringe benefits are
given in addition to one's salary, either to reimburse
him for expenses he might have incurred in relation to
his work, or as a form of supplementary compensation.
On the other hand, retirement benefits are given to one
who is separated from employment either voluntarily or
compulsorily. Such benefits, subject to certain requisites
imposed by law and/or contract, are given to the
employee on the assumption that he can no longer work.
They are also given as a form of reward[7] for the
services he had rendered. The purpose is not to enrich
him but to help him during his non-productive years.

Our Decision dated October 11, 2011 does not preclude

Movants Federico Pascual, et al. from receiving
retirement benefits provided by existing retirement laws.
What they are prohibited from getting are the additional
benefits under the GSIS RFP, which we found to have
emanated from a void and illegal board resolution. To
allow the payees to retain the disallowed benefits would
amount to their unjust enrichment to the prejudice of the
GSIS, whose avowed purpose is to maintain its actuarial
solvency to finance the retirement, disability, and life
insurance benefits of its members.[8]

This Court, elucidating on the concept of unjust

enrichment in University of the Philippines v. PHILAB
Industries, Inc.,[9] said:

Unjust enrichment is a term used to depict result or effect

of failure to make remuneration of or for property or
benefits received under circumstances that give rise to
legal or equitable obligation to account for them; to be
entitled to remuneration, one must confer benefit by
mistake, fraud, coercion, or request. Unjust enrichment is
not itself a theory of reconvey. Rather, it is a prerequisite
for the enforcement of the doctrine of restitution.[10]

The statutory basis for unjust enrichment is found in

Article 22 of the Civil Code, which provides:

Every person who through an act of performance by

another, or any other means, acquires or comes into
possession of something at the expense of the latter
without just or legal ground, shall return the same to
him.

Under the foregoing provision, there is unjust

enrichment when:
1 A person is unjustly benefited; and
2 Such benefit is derived at the expense of or with
damages to another.[11]
In Car Cool Philippines, Inc. v. Ushio Realty and
Development Corporation[12] we said:

[T]here is unjust enrichment when a person unjustly

retains a benefit to the loss of another, or when a person
retains money or property of another against the
fundamental principles of justice, equity and good
conscience.
x x x.[13] (Citation omitted.)

In the same case, we added that "[t]here is no unjust

enrichment when the person who will benefit has a valid
claim to such benefit."[14] Because the GSIS RFP, which
we repeat, is contrary to law, thus void and of no effect,
the enrichment of the payees is without just or legal
ground. Therefore, the payees have no valid claim to the
benefits they received under the GSIS RFP.

The payees received the disallowed benefits with the

mistaken belief that they were entitled to the same under
the GSIS RFP. Article 1456 of the Civil Code, which is
applicable in this case, reads:

If property is acquired through mistake or fraud, the

person obtaining it is, by force of law, considered a
trustee of an implied trust for the benefit of the person
from whom the property comes.
Construing the above provision, this Court, in Aznar
Brothers Realty Company v. Aying,[15] quoted
established jurisprudence as follows:
A deeper analysis of Article 1456 reveals that it is not a
trust in the technical sense for in a typical trust,
confidence is reposed in one person who is named a
trustee for the benefit of another who is called the cestui
que trust, respecting property which is held by the
trustee for the benefit of the cestui que trust. A
constructive trust, unlike an express trust, does not
emanate from, or generate a fiduciary relation. While in
an express trust, a beneficiary and a trustee are linked by
confidential or fiduciary relations, in a constructive trust,
there is neither a promise nor any fiduciary relation to
speak of and the so-called trustee neither accepts any
trust nor intends holding the property for the
beneficiary.

xxxx

x x x [I]mplied trusts are those which, without being

expressed, are deducible from the nature of the
transaction as matters of intent or which are
superinduced on the transaction by operation of law as
matters of equity, independently of the particular
intention of the parties. x x x[16]
Policarpio v. Court of Appeals[17] expounded on the
doctrine of implied trust in relation to another provision
of the Civil Code. We ruled in the said case that a
constructive trust is substantially an appropriate remedy
against unjust enrichment, as follows:
And specifically applicable to the case at bar is the
doctrine that [a] constructive trust is substantially an
appropriate remedy against unjust enrichment. It is
raised by equity in respect of property, which has been
acquired by fraud, or where although acquired originally
without fraud, it is against equity that it should be
retained by the person holding it.[18]
Thus, the payees, who acquired the retirement benefits
under the GSIS RFP, are considered as trustees of the
disallowed amounts, as although they committed no
fraud in obtaining these benefits, it is against equity and
good conscience for them to continue holding on to
them.

WHEREFORE, premises considered, the Motion for

Clarification and Reconsideration and Manifestation to
Supplement the Motion for Clarification and
Reconsideration filed by Romeo C. Quilatan and the
Motion for Clarification (which we treat as a Motion for
Reconsideration) filed by Federico Pascual, Daniel N.
Mijares, Elvira U. Geronimo, Aurora P. Mathay, Manuel
P. Bausa, Rustico G. Delos Angeles, Lourdes Delos
Angeles, Sonia S. Sindac, Marina Santamaria, the Estate
of Lourdes G. Patag represented by Napolen Patag, and
Vicente Villegas are DENIED.

COCONUT OIL REFINERS ASSOCIATION, INC. vs TORRES

[G.R. No. 132527. July 29, 2005]
Facts:
This is a Petition for Prohibition and Injunction seeking to enjoin and
prohibit the Executive Branch, through the public respondents Ruben
Torres in
his capacity as Executive Secretary, the Bases Conversion
Development
Authority (BCDA), the Clark Development Corporation (CDC) and the
Subic
Bay Metropolitan Authority (SBMA), from allowing, and the
private
respondents from continuing with, the operation of tax and duty-free
shops
located at the Subic Special Economic Zone (SSEZ) and the Clark
Special
Economic Zone (CSEZ), and to declare the following
issuances as
unconstitutional, illegal, and void.
The Subic Special Economic Zone shall be operated and managed as
a
separate customs territory ensuring free flow or movement of goods
and capital
within, into and exported out of the Subic Special Economic Zone, as
well as
provide incentives such as tax and duty-free importations of raw
materials,
capital and equipment. However, exportation or removal of goods from
the
territory of the Subic Special Economic Zone to the other parts of the
Philippine
territory shall be subject to customs duties and taxes under the
Customs and
Tariff Code and other relevant tax laws of thePhilippines [RA 7227,
Sec 12 (b)].
Petitioners contend that the wording of Republic Act No. 7227 clearly
limits the grant of tax incentives to the importation of raw
materials, capital and equipment only thereby violating the equal
protection
clause of the Constitution. He also assailed the constitutionality of
Executive
Order No. 97-A for being violative of their right to equal protection.
They
asserted that private respondents operating inside the SSEZ are not
different
from the retail establishments located outside.
The respondent moves to dismiss the petition on the ground of lack of
legal standing and unreasonable delay in filing of the petition.
Issues:
Whether or not there is a violation of equal protection clause.

Held:
The SC ruled in the negative. The phrases tax and duty-
free
importations of raw materials, capital and equipment was merely cited
as an
example of incentives that may be given to entities operating within
the zone.
Public respondent SBMA correctly argued that the maxim expressio
unius est
exclusio alterius, on which petitioners impliedly rely to support their
restrictive
interpretation, does not apply when words are mentioned by way of
example.
The petition with respect to declaration of unconstitutionality
of
Executive Order No. 97-A cannot be, likewise, sustained. The
guaranty of the
equal protection of the laws is not violated by a legislation based
which was
based on reasonable classification. A classification, to be valid, must
(1) rest on
substantial distinction, (2) be germane to the purpose of the law, (3)
not be
limited to existing conditions only, and (4) apply equally to all
members of the
same class. Applying the foregoing test to the present case, this Court
finds no
violation of the right to equal protection of the laws. There is a
substantial
distinctions lying between the establishments inside and outside the
zone. There
are substantial differences in a sense that, investors will be lured to
establish and
operate their industries in the so-called ‘secured area and the present
business
operators outside the area. There is, then, hardly any reasonable
basis to extend
to them the benefits and incentives accorded in R.A. 7227.

WHEREFORE, the petition is PARTLY GRANTED. Section 5 of

Executive Order No. 80 and Section 4 of BCDA Board Resolution No.
93-05-
034 are hereby declared NULL and VOID and are accordingly
declared of no
legal force and effect. Respondents are hereby enjoined from
implementing the
aforesaid void provisions. All portions of Executive Order No. 97-A are
valid
and effective, except the second sentences in paragraphs 1.2 and 1.3
of said
Executive Order, which are hereby declared INVALID.