Roma Drug v. RTC of Guagua, G.R. No.

149907

Facts:
● a team composed of the (NBI) operatives and inspectors of the FDA conducted a raid
on petitioner Roma Drug, a duly registered sole proprietorship of petitioner Romeo
Rodriguez (Rodriguez) operating a drug store located at Pampanga.
● The raid was conducted pursuant to a search warrant1 issued RTC
● It appears that Roma Drug is one of six drug stores which were raided on or around the
same time upon the request of SmithKline Beecham Research Limited
(SmithKline), a duly registered corporation which is the local distributor of
pharmaceutical products manufactured by its parent London-based corporation.
● The seized medicines, which were manufactured by SmithKline, were imported directly
from abroad and not purchased through the local SmithKline, the authorized Philippine
distributor of these products.
● The NBI subsequently filed a complaint against Rodriguez for violation of Section 4 (in
relation to Sections 3 and 5) of Republic Act No. 8203, also known as the Special Law
on Counterfeit Drugs (SLCD)
● The section prohibits the sale of counterfeit drugs, which under Section 3(b)(3),
includes "an unregistered imported drug product."
● The term "unregistered" signifies the lack of registration with the Bureau of Patent,
Trademark and Technology Transfer of a trademark, tradename or other
identification mark of a drug in the name of a natural or juridical person, the process of
which is governed under Part III of the Intellectual Property Code.
● In this case, there is no doubt that the subject seized drugs are identical in content
with their Philippine-registered counterparts.
● There is no claim that they were adulterated in any way or mislabeled at least.
● Their classification as "counterfeit" is based solely on the fact that they were
imported from abroad and not purchased from the Philippine-registered owner of
the patent or trademark of the drugs.
● Rodriguez challenged the constitutionality of SLCD on the grounds that it
contravenes three provisions of the Constitution. The first is the equal protection
clause of the Bill of Rights. The two other provisions are Section 11, Article XIII, which
mandates that the State make "essential goods, health and other social services
available to all the people at affordable cost;" and Section 15, Article II, which states that
it is the policy of the State "to protect and promote the right to health of the people and
instill health consciousness among them."
● The presumption of constitutionality was invoked by the state
Issue:
Whether SLCD is unconstitutional?
SC DECISION
● such questions have in fact been mooted with the passage in 2008 of Republic Act No.
9502, also known as the "Universally Accessible Cheaper and Quality Medicines Act of
2008"
 ● Section 7 of Rep. Act No. 9502 amends Section 72 of the Intellectual Property
Code in that the later law unequivocally grants third persons the right to import
drugs or medicines whose patent were registered in the Philippines by the owner
of the product
● The unqualified right of private third parties such as petitioner to import or
possess "unregistered imported drugs" in the Philippines is further confirmed by
the "Implementing Rules to Republic Act No. 9502" promulgated on 4 November
2008.
● It may be that Rep. Act No. 9502 did not expressly repeal any provision of the SLCD.
However, it is clear that the SLCO’s classification of "unregistered imported drugs" as
"counterfeit drugs," and of corresponding criminal penalties therefore are irreconcilably
in the imposition conflict with Rep. Act No. 9502 since the latter indubitably grants
private third persons the unqualified right to import or otherwise use such drugs.
● Where a statute of later date, such as Rep. Act No. 9502, clearly reveals an intention on
the part of the legislature to abrogate a prior act on the subject that intention must be
given effect.
● Irreconcilable inconsistency between two laws embracing the same subject may exist
when the later law nullifies the reason or purpose of the earlier act, so that the latter
loses all meaning and function. Legis posteriors priores contrarias abrogant
Discussion of the Court to the Constitutionality of the questioned provision of SLCD
● It discriminates, at the expense of health, against poor Filipinos without means to travel
abroad to purchase less expensive medicines in favor of their wealthier brethren able to
do so.
● Less urgently perhaps, but still within the range of constitutionally protected behavior, it
deprives Filipinos to choose a less expensive regime for their health care by
denying them a plausible and safe means of purchasing medicines at a cheaper
cost.
● The absurd results from this far-reaching ban extends to implications that deny the basic
decencies of humanity.
● The law would make criminals of doctors from abroad on medical missions of such
humanitarian organizations such as the International Red Cross, the International Red
Crescent, Medicin Sans Frontieres, and others
● Note that the SLCD is a special law, and the traditional treatment of penal provisions of
special laws is that of malum prohibitum–or punishable regardless of motive or criminal
intent. For a law that is intended to help save lives, the SLCD has revealed itself as a
heartless, soulless legislative piece.
Granted.
TRO to prosecute Rodrigues is hereby made Permanent.
 Department of Health v. Philip Morris Philippines Manufacturing, Inc.

Facts:
● 2008, PMPMI, through the advertising agency PCN Promopro, Inc. (PCN), by virtue of
Article 116 of Republic Act No. (RA) 7394 or the "Consumer Act of the Philippines,"
applied for a sales promotion permit before the FDA, for its Gear Up Promotional Activity
(Gear Up Promo).
● The application included the mechanics for the promotional activity, as well as
relevant materials and fees.
● PMPMI was only verbally informed of the existence of a Memorandum issued by the
DOH purportedly prohibiting tobacco companies from conducting any tobacco
promotional activities in the country.
● On January 8, 2009, PCN requested the BFAD to formally place on record the lack of
any formal action on its Gear Up Promo application.
● Meanwhile, PMPMI, through another advertising agency, Arc Worldwide Philippines Co.
(AWPC), filed another application for a sales promotional permit, this time for its Golden
Stick Promotional Activity (Golden Stick Promo) which the BFAD, however, refused
outright, pursuant to a directive of the BFAD Director that all permit applications
for promotional activities of tobacco companies will no longer be accepted.
● Eventually, in a letter the BFAD denied PMPMI’s Gear Up Promo application in
accordance with the instructions of the Undersecretary of Health for Standards
and Regulations, directing that as of July 1, 2008, "all promotions, advertisements
and/or sponsorships of tobacco products are already prohibited," based on the
provisions of RA 9211 or the "Tobacco Regulation Act of 2003."
● PMPMI filed an administrative appeal before the DOH Secretary, assailing the BFAD’s
denial of its Gear Up Promo application, as well as its refusal to accept the Golden Stick
Promo application.
● PMPMI maintained that under RA 9211, promotion is not prohibited but merely
restricted, and that while there are specific provisions therein totally banning
tobacco advertising and sponsorships, no similar provision could be found
banning promotion.
● it insisted that the denial of its promotional permit applications was tantamount to a
violation of its right to due process as well as their right to property
DOH Ruling:
● denied PMPMI’s appeal, as well as all other similar actions filed by other tobacco
companies and thereby affirmed the action of the BFAD denying their sales promotional
permit applications, pursuant to the provisions of RA 9211.
● the DOH ruled that the issuance of permits for sales promotional activities was never a
ministerial duty of the BFAD; rather, it was a discretionary power to be exercised
within the confines of the law. Moreover, previous approvals of sales promotional
permit applications made by the BFAD did not create a vested right on the part of the
tobacco companies to have all applications approved.
 ● The DOH likewise ruled that the intent and purpose of RA 9211 was to completely
ban tobacco advertisements, promotions, and sponsorships, as promotion is
inherent in both advertising and sponsorship.
● As such, if RA 9211 completely prohibited advertisements and sponsorships, then it is
clear that promotion, which is necessarily included in both activities, is likewise
prohibited, explaining further that the provisions of RA 9211 should not be
interpreted in a way as would render them ridiculous or meaningless
CA Ruling:
● Granted the petition.
● upon a finding that the provisions of RA 9211 were clear when it distinguished promotion
from advertising and sponsorship, so much so that while the latter two (2) activities were
completely banned as of July 1, 2008, the same does not hold true with regard to
promotion, which was only restricted.
● the CA ruled that the DOH wrongfully arrogated unto itself the authority given to the IAC-
Tobacco to administer and implement the provisions of RA 9211, which includes
regulation of tobacco promotions.
Issue:
(a) whether or not the CA erred in finding that the authority of the DOH, through the
BFAD, to regulate tobacco sales promotions under Article 116 in relation to Article 109 of RA
7394 had already been impliedly repealed by RA 9211, which created the IAC-Tobacco and
granted upon it the exclusive authority to administer and implement the provisions thereof; and
(b) whether or not the CA erred in ascribing grave abuse of discretion upon the DOH
when the latter held that RA 9211 has also completely prohibited tobacco promotions as of July
1, 2008.
SC Decision:
● The DOH derives its authority to rule upon applications for sales promotion permits from
the above-cited provisions. On the other hand, Section 29 of RA 9211 creating the IAC-
Tobacco.
● the creation of the IAC-Tobacco effectively and impliedly repealed the above-
quoted provisions of RA 7394, thereby removing the authority of the DOH to rule
upon applications for sales promotional permits filed by tobacco companies such
as those filed by PMPMI subject of this case.
● Identifying its Gear Up Promo and Golden Stick Promo to be activities that fall under
sales promotion as contemplated in the said provision, PMPMI filed its permit
applications under Article 116 of RA 7394 before the BFAD.
Take note of this:
a. "Sales Promotion" means techniques intended for broad consumer participation which
contain promises of gain such as prizes xxx
b. "Promotion" – refers to an event or activity organized by or on behalf of a tobacco
manufacturer, distributor or retailer with the aim of promoting a brand of tobacco product,
xxx
● As adverted to elsewhere, the IAC-Tobacco shall have the exclusive power and function
to administer and implement the provisions of RA 9211, which includes the conduct of
regulating promotion.
 ● The Court has judiciously scrutinized the above definitions and finds that there is no
substantial difference between the activities that would fall under the purview of "sales
promotion" in RA 7394, as well as those under "promotion" in RA 9211, as would
warrant a delineation in the authority to regulate its conduct.
● In fact, the techniques, activities, and methods mentioned in the definition of
"sales promotion" can be subsumed under the more comprehensive and broad
scope of "promotion."
● if "sales promotion" is considered as one of the subcategories of "promotion," it is clear,
therefore, that "promotion" necessarily incorporates the activities that fall under "sales
promotion."
● Considering that the common and fundamental purpose of these marketing strategies is
to raise customer awareness in order to increase consumer demand or sales, drawing a
demarcation line between "promotion" and "sales promotion" as two distinct and
separate activities would be unnecessarily stretching their meanings and, accordingly,
sow more confusion.
● Finally, it must be stressed that RA 9211 is a special legislation which exclusively
deals with the subject of tobacco products and related activities. On the other
hand, RA 7394 is broader and more general in scope, and treats of the general
welfare and interests of consumers vis-à-vis proper conduct for business and
industry.
● As such, lex specialis derogat generali.
● General legislation must give way to special legislation on the same subject, and
generally is so interpreted as to embrace only cases in which the special provisions are
not applicable. In other words, where two statutes are of equal theoretical application to
a particular case, the one specially designed therefore should prevail.
● In fine, the Court agrees with the CA that it is the IAC-Tobacco and not the DOH
which has the primary jurisdiction to regulate sales promotion activities as
explained in the foregoing discussion.
Denied, affirmed,
Case is remanded to its proper agency for appropriate action
 Petron Corporation vs. Spouses Jovero
Facts:
● Rubin Uy entered into a Contract of Lease with Cesar Jovero over a property located at
E. Reyes Ave., Estancia, Iloilo for the purpose of operating a gasoline station for a
period of five years.
● By virtue of an SPA, Chiong Uy and his wife, Dortina Uy, operated the gasoline station
as agents of Rubin Uy.
● Petron entered into a Retail Dealer Contract with Rubin Uy wherein the former would
supply petroleum to the latter as dealer for the period 1 May 1984 to 30 April 1989.
● Petron contracted the hauling services of Jose Villaruz to deliver the petroleum.
● In January 1991, Petron requested the services of Villaruz for the delivery of an
order to the gasoline station in Estancia, Iloilo.
● Villaruz used a tank truck different from the trucks specifically enumerated in the
hauling contract but Petron nevertheless allowed the transport.
● During the unloading of the petroleum from the tank truck into the fill pipe that led to the
gasoline station’s underground tank, for reasons unknown, a fire started in the fill pipe
and spread to the rubber hose connected to the tank truck.
● During this time, driver Pepito Igdanis was nowhere to be found.
● When Igdanis returned and saw the fire, he got into the truck without detaching the
rubber hose from the fill pipe and drove in reverse, dragging the burning fuel hose
along the way.
● As a result, a conflagration started and consumed the nearby properties of
respondents — spouses Jovero, spouses Tan and spouses Limpoco.
● They alleged that the negligence of Petron and its co-defendants in the conduct of their
businesses caused the fire
● The RTC found Petron and its co-defendants solidarily liable for damages.
● CA upheld the decision that Petron was negligent for having allowed the operation of
the gasoline station absent a valid dealership contract.
● Even if a valid dealership contract existed, Petron was still liable for damages, because
there was as yet no complete delivery of its products.
● The fire had broken out while petroleum was being unloaded from the tank truck to
the storage tank.
Issue:
Whether Petron be held liable for damages? (YES)
SC DECISION
● With the use of its trade name and trademark, Petron and the dealer inform and
guarantee to the public that the products and services are of a particular standard
or quality.
● Thus, respondents, who suffered damages from the act or omission that occurred in the
gasoline station and that caused the fire, may file an action against Petron based on the
representations it made to the public.
● As far as the public is concerned, it is enough that the establishment carries
exclusively the name and products of Petron to assume that the latter is liable for
acts done within the premises.
 ● the expiration or nonexistence of a dealership contract did not ipso facto transform the
relationship of the dealer and Petron into one of agency. As far as the parties to the
dealership contract were concerned, the rights and obligations as to them still subsisted,
since they continued to mutually benefit from the agreement.
● Petron is liable to respondents for the damages caused by the fire
● The incident occurred at the time the petroleum was being unloaded to the underground
tank Petron owned.
● .Aside from failing to show the actual cause of the fire, it also failed to rebut the
presumption that it was negligent in the maintenance of its properties and in the
conduct of its business
● Petron obligated itself to deliver the products to the dealer.
● There was yet no complete delivery of the goods as evidenced by the hauling contract
Petron executed with Villaruz. That contract made it clear that delivery would only be
perfected upon the complete unloading of the gasoline.
● Thus, with regard to the delivery of the petroleum, Villaruz was acting as the agent of
Petron.
● Petron and Rubin Uy are solidarily liable to respondents
● Petron was negligent in allowing a tank truck different from that specifically
provided under its hauling contract
● The enumeration and specification of particular tank trucks in the contract serve a
purpose – to ensure the safe transportation, storage and delivery of highly flammable
products.
● To reiterate, it was not able to prove the proximate cause of the fire, only the
involvement of the tank truck and the underground storage tank. Notably, both pieces of
equipment were under its responsibility.
● Absent any positive determination of the cause of the fire, a presumption exists that
there was something wrong with the truck or the underground storage tank, or both.
● Villaruz is liable to Petron by virtue of the non-liability clause in the hauling
contract
● While Petron may be vicariously liable to third persons for damages caused by Villaruz,
the latter is nevertheless liable to Petron by virtue of the non-liability clause in the
hauling contract
● However, considering that Petron did not implead Villaruz in the present case, nor did it
assail the CA Decision in dismissing the cross-claim, Petron can no longer go after
Villaruz based on that cross-claim.
● Solidary liability between Villaluz, Petron, Rubin Uy and Dortina Uy
Denied affirmed
 Manila Electric Co. v. Nordec Philippines

Facts:
● Meralco was contracted to supply electricity to Marvex Industrial Corporation (Marvex)
under an Agreement for Sale of Electric Energy
● It installed metering devices at Marvex's premises on January 18, 1985. Marvex was
billed according to the monthly electric consumption recorded in its meter.
● Meralco service inspectors inspected Marvex's electric metering facilities and
found that the main meter terminal and cover seals had been tampered with.
● Subsequently, Meralco assessed Marvex a differential billing of P371,919.58 for January
18, 1985 to May 29, 1985, and P124,466.71 for June 17, 1985 to September 18, 1985,
in the total amount of P496,386.29.
● Meralco sent demand letters dated August 7, 1985 and November 29, 1985, and
disconnected Marvex's electric service when it did not pay.
● Nordec, the new owner of Marvex, sued Meralco for damages with prayer for preliminary
mandatory injunction
● It alleged that Meralco's service inspectors conducted the 1985 inspections without its
consent or approval.
● Following the inspections, Meralco's inspectors gave an unnamed Nordec employee a
Power Field Order that did not mention the alleged defects in the metering devices.
● Nordec claimed that Meralco then disconnected its service without prior notice on
December 18, 1986, resulting to loss of income and cancellation of other business
opportunities.
● Meralco claimed that the 1985 inspections had been conducted in the presence of
Nordec's representatives.
● Further, Meralco had repeatedly warned Nordec of service disconnection in case
of failure to pay the differential bill.
● Finally, it averred that there was no contractual relation between Nordec and Marvex,
and that Nordec and its president, Dr. Potenciano Malvar (Dr. Malvar), failed to show
proof that they were authorized to sue on Marvex's behalf.
RTC
● Issued a WPI directing meralco to restore nordec’s electric supply
● Meralco conducted another inspection of Nordec's premises in the presence of Nordec's
president, Dr. Malvar.
● The inspecting group observed that there were irregularities in Nordec's metering
devices, as they continued to register power consumption even though its entire
power supply equipment was turned off.
● Merealco offered refund, to which nordec rejected
● Nordec filed a supplemental complaint praying that Meralco be declared guilty of
tampering, and be made to refund its excess bill of not less than P5,625.10.
● Dismissed the original and supplemental complaint
● The trial court found that there was sufficient evidence to prove that the electric meter
and metering installation at Marvex premises had been tampered with.
 ● Moreover, Nordec failed to prove that Meralco's inspectors had ill motives to falsify their
findings regarding the tampered meter, or that the inspectors were responsible for the
tampering.
● There was also no contractual relationship between Nordec and Meralco, since
the service contract was between Meralco and Marvex. Thus, Nordec had no
cause of action against Meralco.
CA
● Reversed
● there was a contractual relationship between Nordec and Meralco. It found that after the
service contract between Meralco and Marvex, Nordec bought Marvex from the
Development Bank of the Philippines. Succession in interest is applied.
● There was no evidence that Nordec was responsible for tampering with its own
metering devices.
Issues:
whether or not the Court of Appeals erred in making findings of fact contrary to those of
the Regional Trial Court;
whether or not Nordec Philippines has a cause of action against Manila Electric
Company;
whether or not Manila Electric Company was inexcusably negligent when it disconnected
Nordec Philippines' electric supply
SC DECISION
● Meralco has failed to show how the Court of Appeals acted with grave abuse of
discretion in arriving at its factual findings and conclusions, or how it grossly
misapprehended the evidence presented as to warrant a finding that its review and
reversal of the trial court's findings of fact had been in error.
● Meralco is deemed to have knowledge of the fact that Nordec was the beneficial
user of Marvex's service contract with Meralco.
● It admits that the inspections of the metering devices were conducted in the presence of
Nordec's maintenance personnel and with the consent of its manager.
● Clearly, Meralco knew that it was dealing with Nordec as the beneficial user of the
electricity supply.
● it must be underscored that MERALCO has the imperative duty to make a reasonable
and proper inspection of its apparatus and equipment to ensure that they do not
malfunction, and the due diligence to discover and repair defects therein. Failure to
perform such duties constitutes negligence.
● It has been held that notice of a defect need not be direct and express; it is enough that
the same had existed for such a length of time that it is reasonable to presume that it
had been detected, and the presence of a conspicuous defect which has existed for
a considerable length of time will create a presumption of constructive notice
thereof.
● MERALCO's failure to discover the defect, if any, considering the length of time,
amounts to inexcusable negligence.
 ● the duty of inspecting for defects is not limited to inherent mechanical defects of
the distribution utilities' devices, but extends to intentional and unintentional
ones, such as those, which are due to tampering and mistakes in computation
● The Ridjo doctrine simply states that the public utility has the imperative duty to
make a reasonable and proper inspection of its apparatus and equipment to
ensure that they do not malfunction. Its failure to discover the defect, if any,
considering the length of time, amounts to inexcusable negligence; its failure to
make the necessary repairs and replace the defective electric meter installed
within the consumer's premises limits the latter's liability.
● The rationale behind this ruling is that public utilities should be put on notice, as a
deterrent, that if they completely disregard their duty of keeping their electric meters in
serviceable condition, they run the risk of forfeiting, by reason of their negligence,
amounts originally due from their customers.
● being a public utility vested with vital public interest, MERALCO is impressed with certain
obligations towards its customers and any omission on its part to perform such duties
would be prejudicial to its interest. For in the final analysis, the bottom line is that those
who do not exercise such prudence in the discharge of their duties shall be made to bear
the consequences of such oversight.
● The Court notes that prior to the inspection, [T.E.A.M. Electronics Corporation] was
informed about it; and months before the inspection, there was an unsettled controversy
between [T.E.A.M. Electronics Corporation] and petitioner, brought about by the
disconnection of electric power and the non-payment of differential billing.
● Petitioner's failure to do so may encourage neglect of public utilities to the
detriment of the consuming public.
● petitioner has the imperative duty to make a reasonable and proper inspection of its
apparatus and equipment to ensure that they do not malfunction, and the due diligence
to discover and repair defects therein. Failure to perform such duties constitutes
negligence.
● Considering that Nordec's meters were read monthly, Meralco's belated discovery
of the cause of the alleged irregularities, or four (4) months after they purportedly
started, can only lead to a conclusion of negligence.
● Meralco failed to comply with the 48-hour disconnection notice rule. Meralco claims that
the statements in its demand letters, that failure to pay would result in disconnection,
were sufficient notice. However, pursuant to Section 97 of Revised General Order No. 1,
the governing rule when the disconnection occurred, disconnection due to non-payment
of bills requires that a 48-hour written notice be given to the customer.
Denied