STONE V MISSISSIPPI

FACTS:
 In 1867, the provisional state legislature of Mississippi chartered the Mississippi
Agricultural, Educational, and Manufacturing Aid Society.
 The Society was chartered to run a lottery for the next 25 years;
 However, in 1868, a new constitution ratified by the people outlawed lotteries in the
state.
 John Stone and others associated with the Society were arrested in 1874 for running a
lottery.
 The Society contended that they were protected by the provisions of their charter
 On the other hand, the state argued that the subsequent enforcement legislation had
repealed the grant.

ISSUE:
WON Mississippi violate the Contract Clause by repealing the Society's grant?

RULING:
 A unanimous Court found that the Mississippi classification of lotteries as outlawed acts
was valid.
 The State legislature do not have the power to bind the decisions of the people and
future legislatures.
 The Court stated that no legislation had the authority to bargain away the public
health and morals.

Furthermore, this provision is not in conflict with the Constitution of the United States, which
prohibits a State from "passing a law impairing the obligation of contracts." Because such
charter is in legal effect nothing more than a license to enjoy the privilege conferred for the
time, and on the terms specified, subject to future legislative or constitutional control or
withdrawal.

 The Court viewed the lottery as a vice that threatened the public health and morals.
 Therefore, one can only obtain temporary suspension of the governmental rights (in this
case, the right to outlaw actions) in a charter which can be revoked by the will of the
people.

The Judgment repealing the Society’s grant is AFFIRMED.

 US V. DIAZ CONDE

FACTS:
 On 30 December 1915, Bartolome Oliveros and Engracia Lianco borrowed P300 from
the defendants and by virtue of a contract, the former obligated themselves with the
interest rate of 5% per month, payable within the first 10 days of every month, and the
first payment shall be made on 10 January 1916.
 Usury Law (Act. 2655) took effect on 01 May 1916, or four months subsequent to the
execution of said contract.
 A complaint was filed against the defendants in violation of the Usury Law. The Court of
First Instance of Manila found the defendants guilty.
 The appellants contend that:
o The contract upon which the alleged usurious interest was collected was
executed before Act No. 2655 was adopted;
o At the time said contract was made (December 30, 1915), there was no usury
law in force in the Philippine Islands;
o Said Act No. 2655 did not become effective until the 1st day of May, 1916, or
four months and a half after the contract in question was executed;
o Said law could have no retroactive effect or operation;
 The lower court argued that even though the contract was established prior to the
passage of the Usury Law, the defendants still collected a usurious amount of interest
after the adoption of said law and therefore, violated such law and must be punished in
accordance to Usury Law.

ISSUE:
W/N the defendants are guilty in violation of Usury Law (Act. No. 2655).

RULING:
NO.
 Ex post facto is most typically used to refer to a criminal statute that punishes actions
retroactively, thereby criminalizing conduct that was legal when originally performed.
 In the present case, the defendants executed an act which was legal before the Usury
Law.
 To make said law applicable to the defendants’ previous act would render it an ex-post
facto operation.
 Moreover, if a contract is legal at its inception, it cannot be rendered illegal by any
subsequent legislation.
 It is an elementary rule of contract that the laws in force at the time the contract was
made must govern its interpretation and application. Laws must be construed
prospectively and not retrospectively.
 Furthermore, the Constitution provides that “No law shall be passed impairing the
obligation of contracts”. If a law is passed rendering the opposite effect, the law is null
and void with respect to Jones Law.

Hence, the higher court held that the acts complained of the defendants did not constitute a
crime at the time they were committed, and therefore the sentence of the lower court is
hereby, revoked.

NOTE:
Usury
 The illegal action or practice of lending money at unreasonably high rates of interest.
 REPUBLIC V. EUGENIO

FACTS:
 A series of investigations concerning the award of the NAIA 3 contracts to PIATCO were
undertaken by the Ombudsman and the Compliance and Investigation Staff (CIS) of
petitioner Anti-money Laundering council (AMLC).
 The OSG wrote the AMLC requesting the latter’s assistance "in obtaining more evidence
to completely reveal the financial trail of corruption surrounding the [NAIA 3] Project,"
 The CIS conducted an intelligence database search on the financial transactions of
certain individuals involved in the award, including respondent Pantaleon Alvarez
(Alvarez) who had been the Chairman of the PBAC Technical Committee of NAIA-IPT3
Project.
 AMLC filed an application to inquire into or examine the deposits or investments of
Alvarez, Trinidad, Liongson, and Cheng Yong before the RTC Makati which was granted.

The Republic, through the AMLC, filed an application before the Manila RTC to inquire into
and/or examine thirteen 13 accounts and 2 related web of accounts alleged as having been
used to facilitate corruption in the NAIA 3 Project. Among said accounts were the DBS Bank
account of Alvarez and the Metrobank accounts of Cheng Yong.

Authority was granted to the AMLC to inquire into the bank accounts listed therein.

 Lilia Cheng, wife of Cheng Yong, filed with the CA a Petition for Certiorari, Prohibition
and Mandamus with Application for TRO and/or Writ of Preliminary Injunction.
 SHE ARGUES that the AMLA, being a substantive penal statute, has no retroactive effect
and the bank inquiry order could not apply to deposits or investments opened prior to
the effectivity of AMLA (Anti Money Laundering Act) or on 17 October 2001.
 Thus, she concludes, her subject bank accounts that she shared with her husband,
Cheng Yong, opened between 1989 to 1990, could not be the subject of the bank
inquiry order otherwise there be a violation of the constitutional prohibition against ex
post facto laws.
 She argues that the prohibition against ex post facto laws goes as far as to prohibit any
inquiry into deposits or investments included in bank accounts opened prior to the
effectivity of the AMLA even if the suspect transactions were entered into when the law
had already taken effect.

ISSUE:
 Whether or not inquiring into bank accounts opened prior to the effectivity of AMLA
(Anti-Money laundering Act) is a violation of the constitutional prohibition against ex-
post facto law.

RULING:
 NO, it is not a violation.
 The Court held that if Lilia’s argument were to be affirmed, it would create a horrible
loophole in the AMLA because all the criminal has to do is to make sure that the money
laundering activity is facilitated through a bank account opened prior to 2001.
 Furthermore, the court held that

"Deposits are supposed to be exempted from scrutiny or monitoring if they are already in place
as of the time the law is enacted.” This indicates that transactions already in place when the
AMLA was passed are indeed exempt from scrutiny through a bank inquiry order, but it
cannot yield any interpretation that RECORDS OF TRANSACTIONS UNDERTAKEN AFTER THE
ENACTMENT OF THE AMLA are similarly exempt.

Hence, her bank accounts, regardless if it was opened prior to the effectivity of AMLA is still
subject to the bank inquiry order.

WHEREFORE, the PETITION is DISMISSED.

NOTE:
In this jurisdiction, we have defined an ex post facto law as one which either:
(Just one of this and the law becomes ex-post facto) – FINAL EXAM

1. makes criminal an act done before the passage of the law and which was innocent when
done, and punishes such an act;
2. aggravates a crime, or makes it greater than it was, when committed;
3. changes the punishment and inflicts a greater punishment than the law annexed to the
crime when committed;
4. alters the legal rules of evidence, and authorizes conviction upon less or different
testimony than the law required at the time of the commission of the offense;
5. assuming to regulate civil rights and remedies only, in effect imposes penalty or
deprivation of a right for something which when done was lawful; and
6. deprives a person accused of a crime of some lawful protection to which he has become
entitled, such as the protection of a former conviction or acquittal, or a proclamation of
amnesty. (Emphasis supplied)
 US V. GOMEZ

FACTS:
 In the province of Misamis, the respondent, Torcuata Gomez, attempted to lie and did
lie with Ramon Narciso Coronel while she was still lawfully married to Fabiano Martinez
Lao
 Furthermore, Narciso Coronel then continued to live in marital relations with Torcuata
Gomez in the same home in the aforementioned province despite the fact that he knew
the said Torcuata Gomez was married and that their marriage had not yet been
dissolved.
 The husband as the aggrieved party did not file any charge, although he testified as a
witness in this case.
 The trial judge, considering that the crime of adultery had been proven and that the
guilt of the accused Torcuata Gomez and Ramon Narciso Coronel had been established,
sentenced each one of them the penalty of prision correccional
 The accused have appealed arguing that the absence of a complaint or charge by the
aggrieved husband cannot be substituted by the complaint filed by the provincial fiscal
of Misamis as such a substitution is not authorized by law.
 The amendatory law permitting the prosecutor to initiate the charges is not applicable
because the crime was committed prior to the effectivity of that law.

ISSUE:
WON the Act No. 1773 permitting the prosecutor the charge was applicable in the case at
bar.

RULING:
No, it is not applicable.
 It is not lawful to attribute retroactive effects to the said Act for the reason that,
even though it refers to a matter of procedure, it does not contain any clause
making it retroactive in its effects, and furthermore, the provisions thereof if applied
now are prejudicial to the accused.

On these grounds all the proceedings in this case, together with the judgment appealed from,
are HEREBY HELD TO BE NULL AND VOID.

NOTE:
Article 434 of the said code reads:
 No penalty shall be imposed for the crime of adultery except upon the complaint of the
aggrieved husband.
 The latter can enter a complaint against both guilty parties, if alive, and never, if he has
consented to the adultery or pardoned either of the culprits.
 PEOPLE V CARLOS

FACTS:
 The lower court found that one day in July or August, 1944, about two or three o'clock
in the morning, a truck pulled up to the curb in front of a house on Constancia Street,
Sampaloc, Manila, where one Martin Mateo lived.
 From the truck the accused, a Japanese spy, alighted together with members of the
Japanese military police and pointed Martin Mateo's house and Fermin Javier's house to
his Japanese companions, whereupon the Japanese soldiers broke into Martin Mateo's
dwelling first and Fermin Javier's afterwards.
 In those houses they seized Martin Mateo, Ladislao Mateo and Fermin Javier, bound
their hands, and put them in the truck.
 Along with other persons who had been rounded up in the other places and who had
been kept in the truck while it was parked, they were taken to Fort Santiago where the
two Mateos and Fermin Javier were tortured and from which they were released six
days later.
 The reason for the arrest and maltreatment of Martin and Ladislao Mateo was that they
had refused to divulge the whereabouts of their brother, Marcelino Mateo, who was a
guerrilla and who had escaped from the Japanese. And Fermin Javier was arrested and
tortured because he himself was a guerrilla, a fact which Carlos knew or at least
suspected.

Carlos, one of the plaintiffs, alleged that the law creating the People's Court is unconstitutional;
Carlos argued that It is a bill of attainder in that it virtually imposes upon specific, known and
identified individuals or group of individual, the penalty of detention and imprisonment for a
period not exceeding six months without any form of judicial trial or procedure.

ISSUE:

The People’s Court had jurisdiction not only to try and decide all cases of crimes against
national security but to convict and sentence the accused for any crime included in the acts
alleged in the information and established by the evidence, and decisions and final orders of
said court were subject to review by the Supreme Court.
 LOZANO V MARTINEZ

FACTS:
 Petitioners were charged with violation of BP 22 (Bouncing Check Law).
 They moved seasonably to quash the information on the ground that the acts charged
did not constitute an offense, the statute being unconstitutional.
 The motions were denied by the respondent trial courts, except in one case, wherein
the trial court declared the law unconstitutional and dismissed the case.
 The parties adversely affected thus appealed.

ISSUES:
 Whether or not BP 22 is violative of the constitutional provision on non-imprisonment
due to debt
 Whether or not BP 22 is violative of the impairment clause

RULING:
1.
 No, The court held that the enactment of BP 22 is a valid exercise of the police power
and is not repugnant to the constitutional inhibition against imprisonment for debt.
 The gravamen of the offense punished by BP 22 is the act of making and issuing a
worthless check or a check that is dishonored upon its presentation for payment. It is
not the non-payment of an obligation which the law punishes. The law is not intended
or designed to coerce a debtor to pay his debt.

The thrust of the law is to prohibit, under pain of penal sanctions, the making of worthless
checks and putting them in circulation. Because of its deleterious effects on the public interest,
the practice is proscribed by the law. The law punishes the act not as an offense against
property, but an offense against public order.

The effects of the issuance of a worthless check transcends the private interests of the parties
directly involved in the transaction and touches the interests of the community at large. The
mischief it creates is not only a wrong to the payee or holder, but also an injury to the public.
The harmful practice of putting valueless commercial papers in circulation, multiplied a
thousand fold, can very wen pollute the channels of trade and commerce, injure the banking
system and eventually hurt the welfare of society and the public interest.

2.
 No, it is not violative of the impairment clause.
 The freedom of contract which is constitutionally protected is freedom to enter into
“lawful” contracts. Contracts which contravene public policy are not lawful.
 Besides, we must bear in mind that checks cannot be categorized as mere contracts. It is
a commercial instrument which, in this modem day and age, has become a convenient
substitute for money; it forms part of the banking system and therefore not entirely free
from the regulatory power of the state.

Thus, BP 22 is CONSTITUTIONAL AND VALID.

 TOLENTINO V. ANGELES (1956)

FACTS:
A report in the form of a complaint was filed by the respondents and members of the Bisig ng
Manggagawa ng Manila Yellow Taxicab Co., Inc., a legitimate labor union representing at least
10% of its membership, charging the petitioners with unfair labor practices under the provisions
of section 17, Republic Act No. 875 (Industrial Peace Act).

They alleged that Ramon Angeles was dismissed from his employment as driver in the said
company, and from the membership in the Union, without the benefit of investigation and
hearing but upon the instigation and intrigue of the petitioners; and that Felix Mapili, Manuel
Salvador and Dominador Bolinao were dismissed also from their employment as driver in the
Company by virtue of and pursuant to a closed shop agreement (Closed-shop agreement is an
agreement whereby an employer binds himself to hire only members of the contracting
union who must continue to remain members in good standing to keep their jobs.).

They claimed that their expulsion from the Union caused by the petitioners was due, among
others, to their attempt to inquire into and inspect the books of account and other records
relative to financial activities of the Union.

The Court of Industrial Relations declared the closed-shop condition of the agreement null and
void and the respondents guilty of unfair labor practice under the provisions of Section 4(6) of
Republic Act No. 875.

Now, the petitioners contended among others that Republic Act No. 875 does not apply to the
case at bar, because the alleged acts constituting unfair labor practice were committed before
the Act took effect.

ISSUE:
 Whether R.A. 875 shall be applied retroactively in the present case. (YES)

RULING:
 A law that penalizes an act not punishable at the time it was performed is ex post facto.
 However, retroactivity of laws that are remedial in nature is not prohibited. And taking
into consideration the declared policy of Republic Act No. 875 to eliminate the causes
of industrial unrest and to promote sound and stable industrial peace, there seems to
be no valid reason why the law could not be applied to acts taking place before its
enactment which would cause or bring about an industrial unrest.
 The acts of the petitioners, as found by the Court of Industrial Relations, are sufficient to
support the pronouncement that they constitute unfair labor practice.