Atty.

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Caltex vs Palomar

G.R. No. L-19650 | September 29, 1966

Justice Castro

Facts:

Petitioner Caltex conceived and laid the groundwork for a promotional scheme calculated to drum up
patronage for its oil products, denominated "Caltex Hooded Pump Contest". To participate, no fee or
consideration is required to be paid, no purchase of Caltex products required to be made. Entry forms are
to be made available upon request at each Caltex station where a sealed can will be provided for the
deposit of accomplished entry stubs. Foreseeing the extensive use of the mails not only as amongst the
media for publicizing the contest but also for the transmission of communications relative thereto,
representations were made by Caltex with the postal authorities for the contest to be cleared in advance
for mailing, having in view sections 1954 (a), 1982 and 1983 of the Revised Administrative Code.

The overtures were later formalized in a letter to the Postmaster General in which the Caltex, thru
counsel, enclosed a copy of the contest rules and endeavored to justify its position that the contest does
not violate the anti-lottery provisions of the Postal Law. Unimpressed, the then Acting Postmaster
General opined that the scheme falls within the purview of the provisions aforesaid and declined to grant
the requested clearance. Caltex later sought a reconsideration of the foregoing stand, stressing that there
being involved no consideration on the part of any contestant, the contest was not, under controlling
authorities condemnable as a lottery.

Issue/s:

1. Whether or not the petition states a sufficient cause of action for declaratory relief
2. Whether or not the Caltex Hooded Pump Contest violates the Postal Law

Ruling:

1. Yes. The Supreme Court ruled that the petition states a sufficient cause of action for declaratory
relief thus, the corporation was entitled to a declaratory relief against the said prosecutor to
determine the legality of the sales promotion scheme.

2. No. The Supreme Court ruled that the Caltex Hooded Pump contest does not transgress any
provisions by the Postal Law. Also, the said promotion does not entail lottery or gift enterprise.
The promotional scheme of the appellee lacks the essential element of consideration from the
definition of the term lottery. The Supreme Court found that the appellee’s promotional scheme is
a gratuitous distribution of property by lot or chance.

RME | Case Digests “Veritas in Caritate”