Life begins at the end of your comfort zone.

–Neale Donald Walsch

CASE DIGEST
People v. Perfecto, G.R. No. L-18463, October 4, 1922

FACTS: The issue started when the Secretary of the Philippine Senate, Fernando Guerrero,
discovered that the documents regarding the testimony of the witnesses in an investigation
of oil companies had disappeared from his office. Then, the day following the convening of
Senate, the newspaper La Nacion – edited by herein respondent Gregorio Perfecto –
published an article against the Philippine Senate. Here, Mr. Perfecto was alleged to have
violated Article 256 of the Spanish Penal Code – provision that punishes those who insults
the Ministers of the Crown. Hence, the issue.

ISSUE: Whether or not Article 256 of the Spanish Penal Code (SPC) is still in force and can be
applied in the case at bar?

HELD: No.

REASONING: The Court stated that during the Spanish Government, Article 256 of the SPC
was enacted to protect Spanish officials as representatives of the King. However, the Court
explains that in the present case, we no longer have Kings nor its representatives for the
provision to protect. Also, with the change of sovereignty over the Philippines from Spanish
to American, it means that the invoked provision of the SPC had been automatically
abrogated. The Court determined Article 256 of the SPC to be ‘political’ in nature for it is
about the relation of the State to its inhabitants, thus, the Court emphasized that ‘it is a
general principle of the public law that on acquisition of territory, the previous political
relations of the ceded region are totally abrogated. ’Hence, Article 256 of the SPC is considered
no longer in force and cannot be applied to the present case. Therefore, respondent was
acquitted.
43 Phil. 887

MALCOLM, J.:
The important question is here squarely presented of whether article 256 of the Spanish
Penal Code, punishing "Any person who, by * * * writing, shall defame, abuse, or insult any
Minister of the Crown or other person in authority * * *," is still in force.
About August 20, 1920, the Secretary of the Philippine Senate, Fernando M. Guerrero,
discovered that certain documents which constituted the records of testimony given by
witnesses in the investigation of oil companies, had disappeared from his office. Shortly
thereafter, the Philippine Senate, having been called into special session by the Governor-
General, the Secretary of the Senate informed that body of the loss of the documents and of
the steps taken by him to discover the guilty party. The day following the convening of the
Senate, September 7, 1920, the newspaper La Nacion, edited by Mr. Gregorio Perfecto,
published an article reading as follows:
"Half a month has elapsed since the discovery, for the first time, of the scandalous robbery
of records which were kept and preserved in the iron safe of the Senate, yet up to this time
there is not the slightest indication that the author or authors of the crime will ever be
discovered.
"To find them, it would not, perhaps, be necessary to go out of the Senate itself, and the
persons in charge of the investigation of the case would not have to display great skill in
order to succeed in their undertaking, unless they should encounter the insuperable obstacle
of official concealment.
"In that case, every investigation to be made would be but a mere comedy and nothing more.
"After all, the perpetration of the robbery, especially under the circumstances that have
surrounded it, does not surprise us at all.
"The execution of the crime was but the natural effect of the environment of the place in
which it was committed.
"How many of the present Senators can say without remorse in their conscience and with
serenity of mind, that they do not owe their victory to electoral robbery? How many?
"The author or authors of the robbery of the records from the said iron safe of the Senate
have, perhaps, but followed the example of certain Senators who secured their election
through fraud and robbery."
The Philippine Senate, in its session of September 9, 1080, adopted a resolution authorizing
its committee on flections and privileges to report as to the action which should be taken
with reference to the article published in La Nacion. On September 15, 1920, the Seriate
adopted a resolution authorizing the President of the Senate to indorse to the Attorney-
General, for his study and corresponding action, all the papers referring to the case of the
newspaper La Nacion and its editor, Mr. Gregorio Perfecto. As a result, an information was
filed in the municipal court of the City of Manila by an assistant city fiscal, in which the
editorial in question was set out and in which it was alleged that the same constituted a
violation of article 256 of the Penal Code. The defendant Gregorio Perfecto was found guilty
in the municipal court and again in the Court of First Instance of Manila.
During the course of the trial in the Court of First Instance, after the prosecution had rested,
the defense moved for the dismissal of the case. On the subject of whether or not article 256
of the Penal Code, under which the information was presented, is in force, the trial judge, the
Honorable George R. Harvey, said:
"This antiquated provision was doubtless incorporated into the Penal Code of Spain for the
protection of the Ministers of the Crown and other representatives of the King against free
speech and action by Spanish subjects. A severe punishment was prescribed because it was
doubtless considered a much more serious offense to insult the King's representative than
to insult an ordinary individual. This provision, with almost all the other articles of that Code,
was extended to the Philippine Islands when under the dominion of Spain because the King's
subjects in the Philippines might defame, abuse or insult the Ministers of the Crown or other
representatives of His Majesty. We now have no Ministers of the Crown or other persons in
authority in the Philippines representing the King of Spain, and said provision, with other
articles of the Penal Code, had apparently passed into 'innocuous desuetude/ but the
Supreme Court of the Philippine Islands has, by a majority decision, held that said article 256
is the law of the land today * * *.
"The Helbig case is a precedent which, by the rule of stare decisis, is binding upon this court
until otherwise determined by proper authority."
In the decision rendered by the same judge, he concluded with the following language:
"In the United States such publications are usually not punishable as criminal offenses, and
little importance is attached to them, because they are generally the result of political
controversy and are usually regarded as more or less colored or exaggerated. Attacks of this
character upon a legislative body are not punishable under the Libel Law. Although such
publications are reprehensible, yet this court feels some aversion to the application of the
provision of law under which this case was filed. Our Penal Code has come to us from the
Spanish regime. Article 256 of that Code prescribes punishment for persons who use
insulting language about Ministers of the Crown or other 'authority/ The King of Spain
doubtless felt the need of such protection to his ministers and others in authority in the
Philippines as well as in Spain. Hence, the article referred to was made applicable here.
Notwithstanding the change of sovereignty, our Supreme Court, in a majority decision, has
held that this provision is still in force, and that one who made an insulting remark about the
President of the United States was punishable under it. ( U. S. vs. Helbig, supra.) If it be
applicable in that case, it would appear to be applicable in this case. Hence, said article 256
must be enforced, without fear or favor, until it shall be repealed or superseded by other
legislation, or until the Supreme Court shall otherwise determine.
"In view of the foregoing considerations, the court finds the defendant guilty as charged in
the information and under article 256" of the Penal Code sentences him to suffer two months
and one day of arresto mayor and the accessory penalties prescribed by law, and to pay the
costs of both instances."
The fifteen errors assigned by the defendant and appellant, reinforced by an extensive brief,
and eloquent oral argument made in his own behalf and by his learned counsel, all reduce
themselves to the pertinent and. decisive question which was announced in the beginning of
this decision.
It will be noted in the first place that the trial judge considered himself bound to follow the
rule announced in the case of United States vs. Helbig (R. G. No. 14705, [1] not published). In
that case, the accused was charged with having said, "To hell with the President and his
proclamations, or words to that effect," in violation of article 256 of the Penal Code. He was
found guilty in a judgment rendered by the Court of First Instance of Manila and again on
appeal to the Supreme Court, with the writer of the instant decision dissenting on two
principal grounds: (1) That the accused was deprived of the constitutional right of cross-
examination, and (2) that article 256 of the Spanish Penal Code is no longer in force.
Subsequently, on a motion of reconsideration, the court, being of the opinion that the Court
of First Instance had committed a prejudicial error in depriving the accused of his right to
cross-examine a principal witness, set aside the judgment affirming the judgment appealed
from and ordered the return of the record to the court of origin for the celebration of a new
trial. Whether such a trial was actually had, is not known, but at least, the record in the Helbig
case has never again been elevated to this court.
There may perchance exist some doubt as to the authority of the decision in the Helbig case,
in view of the circumstances above described. This much, however, is certain: The facts of
the Helbig case and the case before us, which we may term the Perfecto case, are different,
for in the first case there was an oral defamation, while in the second there is a written
defamation. Not only this, but a new point which, under the facts, could not have been
considered in the Helbig case, is, in the Perfecto case, urged upon the court. And, finally, as is
apparent to all, the appellate court is not restrained, as was the trial court, by strict
adherence to a former decision. We much prefer to resolve the question before us
unhindered by references to the Helbig decision.
This is one of those cases on which a variety of opinions all leading to the same result can be
had. A majority of the court are of the opinion that the Philippine Libel Law, Act No. 277, has
had the effect of repealing so much of article 256 of the Penal Code as relates to written
defamation, abuse, or insult, and that under the information and the facts, the defendant is
neither guilty of a violation of article 256 of the Penal Code, nor of the Libel Law. The view of
the Chief Justice is that the accused should be acquitted for the reason that the facts alleged
in the information do not constitute a violation of article 256 of the Penal Code. Three
members of the court believe that article 256 was abrogated completely by the change from
Spanish to American sovereignty over the Philippines and is inconsistent with democratic
principles of government.
Without prejudice to the right of any member of the court to explain his position, we will
discuss the two main points just mentioned.
1. Effect of the Philippine Libel Law, Act No. 277, on article 256 of the Spanish Penal Code.
The Libel Law, Act No. 277, was enacted by the Philippine Commission shortly after
the organization of this legislative body. Section 1 defines libel as a "malicious
defamation, expressed either in writing, printing, or by signs or pictures, or the like,
or public theatrical exhibitions, tending to blacken the memory of one who is dead or
to impeach the honesty, virtue, or reputation, or publish the alleged or natural defects
of one who is alive, and thereby expose him to public hatred, contempt or ridicule."
Section 13 provides that "All laws and parts of laws now in force, so far as the same
may be in conflict herewith, are hereby repealed. * * *"
That parts of laws in force in 1901 when the Libel Law took effect, were in conflict therewith,
and that the Libel Law abrogated certain portions of the Spanish Penal Code, cannot be
gainsaid. Title X of Book II of the Penal Code, covering the subjects of calumny and insults,
must have been particularly affected by the Libel Law. Indeed, in the early case of Pardo de
Tavera vs. Garcia Valdez ([1902], 1.Phil., 468), the Supreme Court spoke of the Libel Law as
"reforming the preexisting Spanish law on the subject of calumnia andinjuria." Recently,
specific attention was given to the effect of the Libel Law on the provisions of the Penal Code,
dealing with calumny and insults, and it was found that those provisions of the Penal Code
on the subject of calumny and insults in which the elements of writing and publicity entered,
were abrogated by the Libel Law. (People vs. Castro [1922], p. 842, ante.)
The Libel Law must have had the same result on other provisions of the Penal Code, as for
instance, article 256.
The facts here are that the editor of a newspaper published an article, naturally in writing,
which may have had the tendency to impeach the honesty, virtue, or reputation of members
of the Philippine Senate, thereby possibly exposing them to public hatred, contempt, or
ridicule, which is exactly libel, as defined by the Libel Law. Sir J. F. Stephen is authority for
the statement that a libel is indictable when defaming a "body of persons definite and small
enough for individual members to be recognized as such, in or by means of anything capable
of being a libel." (Digest of Criminal Law, art. 267.) But in the United States, while it may be
proper to prosecute criminally the author of a libel charging a legislator with corruption,
criticisms, no matter how severe, on a legislature, are within the range of the liberty of the
press, unless the intention and effect be seditious. (3 Wharton's Criminal Law, p. 2131.) With
these facts and legal principles in mind, recall that article 256 begins: "Any person who, by *
* * writing, shall defame, abuse, or insult any Minister of the Crown or other person in
authority," etc.
The Libel Law is a complete and comprehensive law on the subject of libel. The well-known
rule of statutory construction is, that where the later statute clearly covers the old subject-
matter of antecedent acts, and it plainly appears to have been the purpose of the legislature
to give expresssion in it to the whole law on the subject, previous laws are held to be repealed
by necessary implication. (1 Lewis' Sutherland Statutory Construction, p. 465.) For identical
reasons, it is evident that Act No. 277 had the effect of repealing article 256 of the Penal Code,
or at least so much of this article as punishes defamation, abuse, or insults by writing.
Act No. 292 of the Philippine Commission, the Treason and Sedition Law, may also have
affected article 256, but as to this point, it is not necessary to make a pronouncement.
2. Effect of the change from Spanish to American sovereignty over the Philippines on
article 256 of the Spanish Penal Code. Appellant's main proposition in the lower court
and again energetically pressed in the appellate court was that article 256 of the
Spanish Penal Code is not now in force because abrogated by the change from Spanish
to American sovereignty over the Philippines and because inconsistent with
democratic principles of government. This view was indirectly favored by the trial
judge, and, as before stated, is the opinion of three members of this court.
Article 256 is found in Chapter V of Title III of Book II of the Spanish Penal Code. Title I of
Book II punishes the crimes of treason, crimes that endanger the peace or independence of
the state, crimes against international law, and the crime of piracy. Title II of the same book
punishes the crimes of lese majeste, crimes against the Cortes and its members and against
the council of ministers, crimes against the form of government, and crimes committed on
the occasion of the exercise of rights guaranteed by the fundamental laws of the state,
including crimes against religion and worship. Title III of the same Book, in which article 256
is found, punishes the crimes of rebellion, sedition, assaults upon persons in authority, and
their agents, and contempts, insults, injurias, and threats against persons in authority, and
insults, injurias, and threats against their agents and other public officers, the last being the
title to Chapter V. The first two articles in Chapter V define and punish the offense of
contempt committed by any one who shall by word or deed defame, abuse, insult, or threaten
a minister of the crown, or any person in authority. Then with an article condemning
challenges to fight duels intervening, comes article 256, now being weighed in the balance.
It reads as follows: "Any person who, by word, deed, or writing, shall defame, abuse, or insult
any Minister of the Crown or other person in authority, while engaged in the performance of
official duties, or by reason of such performance, provided that the offensive conduct does
not take place in the presence of such minister or person, or the offensive writing be not
addressed to him, shall suffer the penalty of arresto mayor," that is, the defamation, abuse,
or insult of any Minister of the Crown of the Monarchy of Spain (for there could not be a
Minister of the Crown in the United States of America), or other person in authority in the
Monarchy of Spain.
It cannot admit of doubt that all those provisions of the Spanish Penal Code having to do with
such subjects as treason, lese majeste, religion and worship, rebellion, sedition, and
contempts of ministers of the crown, are no longer in force. Our present task, therefore, is a
determination of whether article 256 has met the same fate, or, more specifically stated,
whether it is in the nature of a municipal law or a political law, and is consistent with the
Constitution and laws of the United States and the characteristics and institutions of the
American Government.
It is a general principle of the public law that on acquisition of territory the previous political
relations of the ceded region are totally abrogated. "Political" is here used to denominate the
laws regulating the relations sustained by the inhabitants to the sovereign. (American
Insurance Co. vs. Canter [1828], 1 Pet., 511; Chicago, Rock Island and Pacific Railway Co. vs.
McGlinn [1885], 114 U. S., 542; Roa vs. Collector of Customs [1912], 23 Phil., 315.) Mr. Justice
Field of the United States Supreme Court stated the obvious when in the course of his opinion
in the case of Chicago, Rock Island and Pacific Railway Co. vs. McGlinn, supra, he said: "As a
matter of course, all laws, ordinances and regulations in conflict with the political character,
institutions and Constitution of the new government are at once displaced. Thus, upon a
cession of political jurisdiction and legislative power and the latter is involved in the former
to the United States, the lawsof the country in support of an established religion or abridging
the freedom of the press, or authorizing cruel and unusual punishments, and the like, would
at once cease to be of obligatory force without any declaration to that effect." To quote again
from the United States Supreme Court: "It cannot be admitted that the King of Spain could, by
treaty or otherwise, impart to the United States any of his royal prerogatives; and much less
can it be admitted that they have capacity to receive or power to exercise them. Every nation
acquiring territory, by treaty or otherwise, must hold it subject to the Constitution and laws
of its own government, and not according to those of the government ceding it." (Pollard vs.
Hagan [1845], 3 How., 210.)
On American occupation of the Philippines, by instructions of the President to the Military
Commander dated May 28, 1898, and by proclamation of the latter, the municipal laws of the
conquered territory affecting private rights of person and property and providing for the
punishment of crime were nominally continued in force in so far as they were compatible
with the new order of things. But President McKinley, in his instructions to General Merritt,
was careful to say: "The first effect of the military occupation of the enemy's territory is the
severance of the former political relation of the inhabitants and the establishment of a new
political power." From that day to this, the Spanish codes, as codes, have been constantly
applied, and ordinarily it has been taken for granted that the provisions under consideration
were still effective. To paraphrase the language of the United States Supreme Court in Weems
vs. United States ([1910], 217 U. S., 349), there was not and could not be, except as precise
questions were presented, a careful consideration of the codal provisions and a
determination of the extent to which they accorded with or were repugnant to the " 'great
principles of liberty and law' which had been 'made the basis of our governmental system.'" But
when the question has been squarely raised, the appellate court has been forced on occasion
to hold certain portions of the Spanish codes repugnant to democratic institutions and
American constitutional principles. ( U. S. vs. Sweet [1901], 1 Phil., 18; U. S. vs. Balcorta
[1913], 25 Phil., 273; U. S. vs. Smith [1919], 39 Phil., 533; Weems vs. U. S., supra.)
The nature of the government which has been set up in the Philippines under American
sovereignty was outlined by President McKinley in that Magna Charta of Philippine liberty,
his instructions to the Commission, of April 7, 1900. In part, the President said:
"In all the forms of government and administrative provisions which they are authorized to
prescribe, the Commission should bear in mind that the government which they are
establishing is designed not for our satisfaction or for the expression of our theoretical views,
but for the happiness, peace, and prosperity of the people of the Philippine Islands, and the
measures adopted should be made to conform to their customs, their habits, and even their
prejudices, to the fullest extent consistent with the accomplishment of the indispensable
requisites of just and effective government. At the same time the Commission should bear in
mind, and the people of the Islands should be made plainly to understand, that there are certain
great principles of government which have been made the basis of our governmental system,
which we deem essential to the rule of law and the maintenance of individual freedom, and of
which they have, unfortunately, been denied the experience possessed by us; that there are also
certain practical rules of government which we have found to be essential to the preservation
of these great principles of liberty and law, and that these principles and these rules of
government must be established and maintained in their islands for the sake of their liberty and
happiness, however much they may conflict with the customs or laws of procedure with
which they are familiar. It is evident that the most enlightened thought of the Philippine
Islands fully appreciates the importance of these principles and rules, and they will
inevitably within a short time command universal assent."
The courts have naturally taken the same view. Mr. Justice Elliott, speaking for our Supreme
Court, in the case of United States vs. Bull ([1910], 15 Phil., 7), said: "The President and
Congress framed the government on the model with which Americans are familiar, and
which has proven best adapted for the advancement of the public interests and the
protection of individual rights and privileges."
Therefore, it has come with somewhat of a shock to hear the statement made that the
happiness, peace, and prosperity of the people of the Philippine Islands and their customs,
habits, and prejudices, to follow the language of President McKinley, demand obeisance to
authority, and royal protection for that authority.
According to our view, article 256 of the Spanish Penal Code was enacted by the Government
of Spain to protect Spanish officials who were the representatives of the King. With the
change of sovereignty, a new government, and a new theory of government, was set up in
the Philippines. It was in no sense a continuation of the old, although merely for convenience
certain of the existing institutions and laws were continued. The demands which the new
government made, and makes, on the individual citizen are likewise different. No longer is
there a Minister of the Crown or a person in authority of such exalted position that the citizen
must speak of him only with bated breath. "In the eye of our Constitution and laws, every
man is a sovereign, a ruler and a freeman, and has equal rights with every other man. We
have no rank or station, except that of respectability and intelligence as opposed to
indecency and ignorance, and the door to this rank stands open to every man to freely enter
and abide therein, if he is qualified, and whether he is qualified or not depends upon the life
and character and attainments and conduct of each person for himself. Every man may
lawfully do what he will, so long as it is not malum in se or malum prohibitum or does not
infringe upon the equally sacred rights of others." (State vs. Shepherd [1903], 177 Mo., 205;
99 A. S. R., 624.)
It is true that in England, from which so many of the laws and institutions of the United States
are derived, there were once statutes of scandalum magnatum, under which words which
would not be actionable if spoken of an ordinary subject were made actionable if spoken of
a peer of the realm or of any of the great officers of the Crown, without proof of any special
damage. The Crown of England, unfortunately, took a view less tolerant than that of other
sovereigns, as for instance, the Emperors Augustus, Caesar, and Tiberius. These English
statutes have, however, long since, become obsolete, while in the United States, the offense
of scandalum magnatum is not known. In the early days of the American Republic, a sedition
law was enacted, making it an offense to libel the Government, the Congress, or the President
of the United States, but the law met with so much popular disapproval, that it was soon
repealed. "In this country no distinction as to persons is recognized, and in practice a person
holding a high office is regarded as a target at whom any person may let fly his poisonous
words. High official position, instead of affording immunity from slanderous and libelous
charges, seems rather to be regarded as making his character free plunder for any one who
desires to create a sensation by attacking it." (Newell, Slander and Libel, 3d ed., p. 245; Sillars
vs. Collier [1890], 151 Mass., 50; 6 L. R. A., 680.)
Article 256 of the Penal Code is contrary to the genius and fundamental principles of the
American character and system of government. The gulf which separates this article from
the spirit which inspires all penal legislation of American origin, is as wide as that which
separates a monarchy from a democratic republic like that of the United States. This article
was crowded out by implication as soon as the United States established its authority in the
Philippine Islands. Penalties out of all proportion to the gravity of the offense, grounded in a
distorted monarchical conception of the nature of political authority, as opposed to the
American conception of the protection of the interests of the public, have been obliterated
by the present system of government in the Islands.
From an entirely different point of view, it must be noted that this article punishes contempts
against executive officials, although its terms are broad enough to cover the entire official
class. Punishment for contempt of non- judicial officers has no place in a government based
upon American principles. Our official class is not, as in monarchies, an agent of some
authority greater than ,the people but it is an agent and servant of the people themselves.
These officials are only entitled to respect and obedience when they are acting within the
scope of their authority and jurisdiction. The American system of government is calculated
to enforce respect and obedience where such respect and obedience is due, but never does
it place around the individual who happens to occupy an official position by mandate of the
people any official halo, which calls for drastic punishment for contemptuous remarks.
The crime of lese majeste disappeared in the Philippines with the ratification of the Treaty of
Paris. Ministers of the Crown have no place under the American flag.
To summarize, the result is, that all the members of the court are of the opinion, although for
different reasons, that the judgment should be reversed and the defendant and appellant
acquitted, with costs de officio. So ordered.
 Life begins at the end of your comfort zone. –Neale Donald Walsch
Macariola Vs. Asuncion 114 SCRA 77

Facts:
On June 8, 1963, respondent Judge Elias Asuncion rendered a decision in Civil Case 3010 final
for lack of an appeal.

On October 16, 1963, a project of partition was submitted to Judge Asuncion. The project of
partition of lots was not signed by the parties themselves but only by the respective counsel
of plaintiffs and petitioner Bernardita R. Macariola. The Judge approved it in his order dated
October 23, 1963.

One of the lots in the project of partition was Lot 1184, which was subdivided into 5 lots
denominated as Lot 1184 A – E. Dr. Arcadio Galapon bought Lot 1184-E on July 31, 1964,
who was issued transfer of certificate of Title No, 2338 of the Register of Deeds of Tacloban
City. On March 6, 1965, Galapon sold a portion of the lot to Judge Asuncion and his wife.

On August 31, 1966, spouses Asuncion and Galapon conveyed their respective shares and
interest inn Lot 1184-E to the Traders Manufacturing & Fishing Industries Inc. Judge
Asuncion was the President and his wife Victoria was the Secretary. The Asuncions and
Galapons were also the stockholder of the corporation.

Respondent Macariola charged Judge Asuncion with "Acts unbecoming a Judge" for violating
the following provisions: Article 1491, par. 5 of the New Civil Code, Article 14, par. 1 & 5 of
the Code of Commerce, Sec. 3 par H of RA 3019 also known as the Anti-Graft & Corrupt
Practice Act., Sec. 12, Rule XVIII of the Civil Service Rules and Canon 25 of the Canons of
Judicial Ethics.
On November 2, 1970 a certain Judge Jose D. Nepomuceno dismissed the complaints filed
against Asuncion.

Issue:
Whether or Not the respondent Judge violated the mentioned provisions.

Ruling:
No. Judge Asuncion did not violate the mentioned provisions constituting of "Acts
unbecoming a Judge" but was reminded to be more discreet in his private and business
activities.

Respondent Judge did not buy the lot 1184-E directly on the plaintiffs in Civil Case No. 3010
but from Dr. Galapon who earlier purchased the lot from 3 of the plaintiffs. When the
Asuncion bought the lot on March 6, 1965 from Dr. Galapon after the finality of the decision
which he rendered on June 8, 1963 in Civil Case No 3010 and his two orders dated October
and November, 1963. The said property was no longer the subject of litigation.

In the case at bar, Article 14 of Code of Commerce has no legal and binding effect and cannot
apply to the respondent. Upon the sovereignty from the Spain to the US and to the Republic
of the Philippines, Art. 14 of this Code of Commerce, which sourced from the Spanish Code
of Commerce, appears to have been abrogated because whenever there is a change in the
sovereignty, political laws of the former sovereign are automatically abrogated, unless they
are reenacted by Affirmative Act of the New Sovereign.

Asuncion cannot also be held liable under the par. H, Sec. 3 of RA 3019, citing that the public
officers cannot partake in any business in connection with this office, or intervened or take
part in his official capacity. The Judge and his wife had withdrawn on January 31, 1967 from
the corporation and sold their respective shares to 3rd parties, and it appears that the
corporation did not benefit in any case filed by or against it in court as there was no case filed
in the different branches of the Court of First Instance from the time of the drafting of the
Articles of Incorporation of the corporation on March 12, 1966 up to its incorporation on
January 9, 1967. The Judge realized early that their interest in the corporation contravenes
against Canon 25.

MACARIOLA V ASUNCION
FACTS
Reyes siblings filed a complaint for partition against Macariola, concerning the properties
left by their common father, Francisco Reyes. Asuncion was the judge who rendered the
decision, which became final for lack of an appeal. A project of partition was submitted to
Judge Asuncion after the finality of the decision. This project of partition was only signed by
the counsel of the parties, who assured the judge that they were given authorization to do
so.
One of the properties in the project of partition was Lot 1184, which was subdivided into 5
lots. One of these lots (Lot 1184-D) was sold to Anota, a stenographer of the court, while
another (Lot 1184-E) was sold to Dr. Galapon, who later on sold a portion of the same lot to
Judge Asuncion and his wife. A year after, spouses Asuncion and Dr. Galapon sold their
respective shares over the lot to Traders Manufacturing and Fishing Industries. At the time
of the sale, Judge Asuncion and his wife were both stockholders, with Judge Asuncion as
President and his wife as secretary of said company.
A year after the company’s registration with the SEC, Macariola filed a complaint against
Judge Asuncion alleging: • that he violated Art. 1491 (5) of the Civil Code in acquiring a
portion of the lot, which was one of those properties involved in the partition case; and • that
he violated Art 14 (1 and 5) of the Code of Commerce, Sec 3 (H) of RA 3019, Sec 12, Rule XVIII
of the Civil Service Rules, and Canon 25 of the Canons of Judicial Ethics by associating himself
with a private company while he was a judge of the CFI of Leyte. This case was referred to
Justice Palma of the CA for investigation, report and recommendation. After hearing, the said
Investigating Justice recommended that Judge Asuncion should be reprimanded or warned
in connection with the complaints filed against him.
ISSUE
1. Whether or not Judge Asuncion violated Art 1491 (5) of the Civil Code in acquiring by
purchase a portion of Lot 1184-E, which was among those properties involved in the
partition case.
2. Whether or not Judge Asuncion violated Art 14 (1 and 5) of the Code of Commerce, Sec 3
(H) of RA 3019, Sec 12, Rule XVIII of the Civil Service Rules and Canon 25 of the Canons of
Judicial Ethics when he associated himself with Traders Manufacturing and Fishing
Industries, Inc., as stockholder and a ranking officer
HELD
1. NO. Although Art 1491 (5) of the Civil Code prohibits justices, judges among others from
acquiring by purchase the property and rights in litigation or levied upon an execution
before the court, the SC has ruled, however, that for the prohibition to operate, the sale or
assignment of the property must take place during the pendency of the litigation involving
the property. In this case, when Judge Asuncion purchased a portion of Lot 1184-E, the
decision in the partition case was already final because none of the parties filed an appeal
within the reglementary period. Thus, the lot in question was no longer subject of the
litigation. Moreover, Judge Asuncion did NOT buy the lot directly from the plaintiffs in the
partition case but from Dr. Galapon, who earlier purchased the lot from the plaintiffs. The
subsequent sale from Dr. Galapon to Judge Asuncion is NOT a scheme to conceal the illegal
and unethical transfer of said lot as a consideration for the approval of the project of
partition. As pointed out by the Investigating Justice, there is no evidence in the record
showing that Dr. Galapon acted as a mere dummy of Judge Asuncion. In fact, Dr. Galapon
appeared to be a respectable citizen, credible and sincere, having bought the subject lot in
good faith and for valuable consideration, without any intervention of Judge Asuncion.
Although Judge Asuncion did NOT violate Art 1491 (5) of the Civil Code, it was IMPROPER
for him to have acquired the lot in question. Canon 3 of the Canons of Judicial Ethics requires
that judges’ official conduct should be free from the appearance of impropriety. It was
unwise and indiscreet on the part of Judge Asuncion to have purchased the property that
was or had been in litigation in his court and caused it to be transferred to a corporation of
which he and his wife were ranking officers at the time of such transfer. His actuations must
not cause doubt and mistrust in the uprightness of his administration of justice.
2. NO. Art 14 (1 and 5) of the Code of Commerce prohibits justices of the SC, judges and
officials of the department of public prosecution in active service from engaging in
commerce, either in person or proxy or from holding any office or have an direct,
administrative or financial intervention in commercial or industrial companies within the
limits of the territory in which they discharge their duties. However, this Code is the Spanish
Code of Commerce of 1885, which was extended to the Philippines by a Royal Decree. Upon
the transfer of sovereignty from Spain to the US to the Philippines, Art 14 of the Code of
Commerce must be deemed to have been abrogated because where there is change of
sovereignty, the political laws of the former sovereign are automatically abrogated, unless
they are expressly re-enacted by affirmative act of the new sovereign. There appears to be
no affirmative act that continued the effectivity of said provision.
Sec 3 (H) of RA 3019 provides for instances when public officers are considered to have
committed corrupt practices, which include having financial or pecuniary interest in any
business, contract or transaction in connection with which he intervenes or takes part in his
official capacity or in which he is prohibited by the Constitution or by any law from having
any interest. Judge Asuncion cannot be held liable under said provision because there is no
showing that he participated or intervened in his official capacity in the business or
transactions of Traders Manufacturing. In this case, the business of the corporation in which
he participated has obviously no relation to his judicial office.
Sec 12, Rule XVIII of the Civil Service Rules does NOT apply to members of the Judiciary, who
are covered under RA 296 (Judiciary Act of 1948) and Art X (7) of the 1973 Constitution.
Under Sec 67 of RA 296, the power to remove or dismiss judges is vested in the President of
the Philippines, not in the CSC, and only on 2 grounds—serious misconduct and inefficiency.
Under the 1973 Constitution, only the SC can discipline judges of the inferior courts as well
as other personnel of the Judiciary. Judges cannot be considered as subordinate civil service
officers or employees because the Commissioner of the CSC is not the head of the Judiciary
department. Moreover, only permanent officers in the classified service are subject to the
jurisdiction of the CSC. Judges, however, are not within this classification, as they are
considered to be non-competitive or unclassified service of the government as a Presidential
appointee.
Canon 25 of the Canons of Judicial Ethics reminds judges to abstain from making personal
investments in enterprises, which are apt to be involved in litigation in his court. Judge
Asuncion and his wife, however, had withdrawn from the corporation and sold their shares
to third parties only 22 days after its incorporation, which indicates that Judge Asuncion
realized that their interest in the corporation contravenes said Canon. The Court even
commended the spouses for such act.
 Life begins at the end of your comfort zone. –Neale Donald Walsch
ARTICLE 8 SECTION 5 PARAGRAPH 1 (1987 Constitution)
JUDICIAL DEPARTMENT
Section 5. The Supreme Court shall have the following powers:
1. Exercise original jurisdiction over cases affecting ambassadors, other public
ministers and consuls, and over petitions for certiorari, prohibition, mandamus, quo
warranto, and habeas corpus.

ARTICLE 11 SECTION 2 (1987 Constitution)

ACCOUNTABILITY OF PIBLIC OFFICERS
Section 2. The Philippines renounces war as an instrument of national policy, adopts the
generally accepted principles of international law as part of the law of the land and adheres
to the policy of peace, equality, justice, freedom, cooperation, and amity with all nations.

ARTICLE 13 SECTION 2 (1973 Constitution)

SOCIAL JUSTICE AND HUMAN RIGHTS
Section 2. The promotion of social justice shall include the commitment to create economic
opportunities based on freedom of initiative and self-reliance.

ARTICLE 9 SECTION 5 (1935 Constitution)

IMPEACHMENT
SECTION 1. The President, the Vice-President, the Justices of the Supreme Court, and the
Auditor General, shall be removed from office on impeachment for, and conviction of,
culpable violation of the Constitution, treason, bribery, or other high crimes.
SEC. 2. The Commission on Impeachment of the National Assembly, by a vote of two-thirds
of its Members, shall have the sole power of impeachment.
SEC. 3. The National Assembly shall have the sole power to try all impeachments. When
sitting for that purpose the Members shall be on oath or affirmation. When the President of
the Philippines is on trial, the Chief Justice of the Supreme Court shall preside. No person
shall be convicted without the concurrence of three-fourths of all the Members who do not
belong to the Commission on Impeachment.
SEC. 4. Judgment in cases of impeachment shall not extend further then to removal from
office and disqualification to hold and enjoy any office of honor, trust, or profit under the
Government of the Philippines, but the party convicted shall nevertheless be liable and
subject to prosecution, trial, and punishment, according to law.
 Life begins at the end of your comfort zone. –Neale Donald Walsch

DE LEON VS. ESGUERRA (153 SCRA 602)

ALFREDO M. DE LEON vs. HON. BENHAMIN B. ESGUERRA (153 SCRA 602) Case Digest
Facts:
In 1982, Alfredo M. De Leon was elected as Baranggay Captain along with the other
petitioners as Barangay Councilmen of Baranggay Dolores, Taytay, Rizal. On February 9,
1987, he received a Memorandum antedated December 1, 1986, signed on February 8, 1987
by OIC Gov. Benhamin B. Esguerra designating Florentino Magno as new Barangay Captain.
A separate Memorandum with the same dates was also issued by Hon. Esguerra replacing
the Barangay Councilmen. De Leon along with the other petitioners filed a petition to declare
the subject Memorandum null and void and prevent the respondents from taking over their
positions in the Barangay. The petitioners maintained that OIC Gov. Esguerra no longer have
the authority to replace them under the 1987 Constitution and that they shall serve a term
of six (6) years in pursuant to Section 3 of the Barangay Election Act of 1982.
Issue:
Was the designation of the new Barangay Officials valid?
Ruling:
The effectivity of the Memorandum should be based on the date when it was signed,
February 8, 1987. By that time, the 1987 Constitution was already in effect, thus superseding
all previous constitution as provided in Section 27 of its Transitory Provisions. Respondent
OIC Governor could no longer rely on Section 2, Article III of the Provisional Constitution to
designate respondents to the elective positions occupied by petitioners.

Barangay Election Act of 1982 should still govern since it is not inconsistent with the 1987
Constitution.

Wherefore, the designation by the OIC Governor of new Barangay Officials was declared NO
LEGAL FORCE AND EFFECT and the Writ for Prohibition is GRANTED enjoining respondents
perpetually from ouster/take-over of petitioners’ position subject of this petition.