1
De Guzman, et. al., petitioners, vs. COMMISSION ON
ELECTIONS, respondent.
PURISIMA, J.:
Facts
At bar is a petition for certiorari and prohibition with
urgent prayer for the issuance of a writ of preliminary
injunction and temporary restraining order, assailing the
validity of Section 44 of Republic Act No. 8189 (RA
8189) otherwise known as "The Voter’s Registration Act
of 1996". RA 8189 was enacted on June 10, 1996 and
approved by President Fidel V. Ramos on June 11,
1996. Section 44 thereof provides:
"SEC. 44. Reassignment of Election Officers. - No
Election Officer shall hold office in a particular city or
municipality for more than four (4) years. Any election
officer who, either at the time of the approval of this Act
or subsequent thereto, has served for at least four (4)
years in a particular city or municipality shall
automatically be reassigned by the Commission to a
new station outside the original congressional district."
By virtue of the aforequoted provision of law, the
Commission on Elections (COMELEC) promulgated
Resolution Nos. 97-00021 and 97-06102 for the
implementation thereof. Thereafter, the COMELEC
issued several directives3 reassigning the petitioners,
who are either City or Municipal Election Officers, to
different stations.
Aggrieved by the issuance of the aforesaid directives
and resolutions, petitioners found their way to this Court
via the present petition assailing the validity of Section
44 of RA 8189, contending that:
I The singling out of election officers in order to "ensure
SECTION 44 OF REPUBLIC ACT NO. 8189 VIOLATES
THE ‘EQUAL PROTECTION CLAUSE’ ENSHRINED IN
THE CONSTITUTION;
II
SECTION 44 OF REPUBLIC ACT NO. 8189 VIOLATES
THE CONSTITUTIONAL GUARANTEE ON SECURITY
OF TENURE OF CIVIL SERVANTS;
III
SECTION 44 OF REPUBLIC ACT NO. 8189
CONSTITUTES A DEPRIVATION OF PROPERTY
WITHOUT DUE PROCESS OF LAW;
IV
SECTION 44 OF REPUBLIC ACT NO. 8189
UNDERMINES THE CONSTITUTIONAL
INDEPENDENCE OF COMELEC AND COMELEC’S
CONSTITUTIONAL AUTHORITY TO NAME,
DESIGNATE AND APPOINT AND THEN REASSIGN
AND TRANSFER ITS VERY OWN OFFICIALS AND
EMPLOYEES;
V complicity of such officials, large scale anomalies in the
SECTION 44 OF REPUBLIC ACT NO. 8189
CONTRAVENES THE BASIC CONSTITUTIONAL
PRECEPT [Article VI, SECTION 26(1), Phil.
Constitution] THAT EVERY BILL PASSED BY
CONGRESS SHALL EMBRACE ONLY ONE SUBJECT
WHICH MUST BE EXPRESSED IN THE TITLE
THEREOF; and
VI
SECTION 44 OF REPUBLIC ACT NO. 8189 IS VOID
FOR FAILURE TO COMPLY WITH THE
CONSTITUTIONAL REQUIREMENT [ARTICLE VI,
SECTION 26 (2)] OF THREE READINGS ON
SEPARATE DAYS AND DISTRIBUTION OF PRINTED
COPIES IN ITS FINAL FORM THREE DAYS BEFORE
ITS PASSAGE.
Petitioners’ contentions revolve on the pivotal issue,
whether Section 44 of RA 8189 is valid and
constitutional.
The petition is barren of merit. Section 44 of RA 8189
enjoys the presumption of validity, and the Court
discerns no ground to invalidate it.
Petitioners theorize that Section 44 of RA 8189 is
violative of the "equal protection clause" of the 1987
Constitution because it singles out the City and
Municipal Election Officers of the COMELEC as
prohibited from holding office in the same city or
municipality for more than four (4) years. They maintain
that there is no substantial distinction between them and
other COMELEC officials, and therefore, there is no valid
classification to justify the objective of the provision of
law under attack.
The Court is not persuaded by petitioners’ arguments.
The "equal protection clause" of the 1987 Constitution
permits a valid classification under the following
conditions:
1. The classification must rest on substantial
distinctions;
2. The classification must be germane to the
purpose of the law;
3. The classification must not be limited to existing
conditions only; and
4. The classification must apply equally to all
members of the same class.4
After a careful study, the ineluctable conclusion is that
the classification under Section 44 of RA 8189 satisfies
the aforestated requirements.
the impartiality of election officials by preventing them
from developing familiarity with the people of their place
of assignment" does not violate the equal protection
clause of the Constitution.
In Lutz vs. Araneta,5 it was held that "the legislature is
not required by the Constitution to adhere to a policy of
‘all or none’". This is so for underinclusiveness is not an
argument against a valid classification. It may be true
that all the other officers of COMELEC referred to by
petitioners are exposed to the same evils sought to be
addressed by the statute. However, in this case, it can
be discerned that the legislature thought the noble
purpose of the law would be sufficiently served by
breaking an important link in the chain of corruption than
by breaking up each and every link thereof. Verily, under
Section 3(n) of RA 8189, election officers are the highest
officials or authorized representatives of the COMELEC
in a city or municipality. It is safe to say that without the
registration of voters can hardly be carried out.
Moreover, to require the COMELEC to reassign all
employees (connected with the registration of voters)
who have served at least four years in a given city or
municipality would entail a lot of administrative burden
on the part of the COMELEC.
Neither does Section 44 of RA 8189 infringe the security
of tenure of petitioners nor unduly deprive them of due
process of law. As held in Sta. Maria vs. Lopez.6
"xxx the rule that outlaws unconsented transfers as
anathema to security of tenure applies only to an officer
who is appointed - not merely assigned - to a particular
station. Such a rule does not pr[o]scribe a transfer

carried out under a specific statute that empowers the
head of an agency to periodically reassign the
employees and officers in order to improve the service of
the agency. xxx" (italics supplied)
The guarantee of security of tenure under the
Constitution is not a guarantee of perpetual
employment.1âwphi1 It only means that an employee
cannot be dismissed (or transferred) from the service for
causes other than those provided by law and after due
process is accorded the employee. What it seeks to
prevent is capricious exercise of the power to dismiss.
But, where it is the law-making authority itself which
furnishes the ground for the transfer of a class of
employees, no such capriciousness can be raised for so
long as the remedy proposed to cure a perceived evil is
germane to the purposes of the law.
Untenable is petitioners’ contention that Section 44 of
RA 8189 undermines the authority of COMELEC to
appoint its own officials and employees. As stressed
upon by the Solicitor General, Section 44 establishes a
guideline for the COMELEC to follow. Said section
provides the criterion or basis for the reassignment or
transfer of an election officer and does not deprive the
COMELEC of its power to appoint, and maintain its
authority over its officials and employees. As a matter of
fact, the questioned COMELEC resolutions and
directives illustrate that it is still the COMELEC which
has the power to reassign and transfer its officials and
employees. But as a government agency tasked with the
implementation and enforcement of election laws, the
COMELEC is duty bound to comply with the laws
passed by Congress.
The independence of the COMELEC is not at issue
here. There is no impairment or emasculation of its
power to appoint its own officials and employees. In fact,
Section 44 even strengthens the COMELEC’s power of
appointment, as the power to reassign or transfer is
within its exclusive jurisdiction and domain.
Petitioners’ contention that Section 44 has an isolated
and different subject from that of RA 8189 and that the
same is not expressed in the title of the law, is equally
untenable.
The objectives of Section 26(1), Article VI of the 1987
Constitution, that "[e]very bill passed by the Congress
shall embrace only one subject which shall be expressed
in the title thereof", are:
1. To prevent hodge-podge or log-rolling legislation;
2. To prevent surprise or fraud upon the legislature by
means of provisions in bills of which the titles gave no
information, and which might therefore be overlooked
and carelessly and unintentionally adopted; and
3. To fairly apprise the people, through such publication
of legislative proceedings as is usually made, of the
subjects of legislation that are being considered, in order
that they may have opportunity of being heard thereon
by petition or otherwise if they shall so desire.7
Section 26(1) of Article VI of the 1987 Constitution is
sufficiently complied with where, as in this case, the title
is comprehensive enough to embrace the general
objective it seeks to achieve, and if all the parts of the
statute are related and germane to the subject matter
embodied in the title or so long as the same are not
inconsistent with or foreign to the general subject and
title.8 Section 44 of RA 8189 is not isolated considering
that it is related and germane to the subject matter
stated in the title of the law. The title of RA 8189 is "The
Voter’s Registration Act of 1996" with a subject matter
2
enunciated in the explanatory note as "AN ACT
PROVIDING FOR A GENERAL REGISTRATION OF
VOTERS, ADOPTING A SYSTEM OF CONTINUING
REGISTRATION, PRESCRIBING THE PROCEDURES
THEREOF AND AUTHORIZING THE APPROPRIATION
OF FUNDS THEREFOR." Section 44, which provides for
the reassignment of election officers, is relevant to the
subject matter of registration as it seeks to ensure the
integrity of the registration process by providing a
guideline for the COMELEC to follow in the
reassignment of election officers. It is not an alien
provision but one which is related to the conduct and
procedure of continuing registration of voters. In this
regard, it bears stressing that the Constitution does not
require Congress to employ in the title of an enactment,
language of such precision as to mirror, fully index or
catalogue, all the contents and the minute details
therein.9
In determining the constitutionality of a statute dubbed
as defectively titled, the presumption is in favor of its
validity.10
As regards the issue raised by petitioners - whether
Section 44 of RA 8189 was enacted in accordance with
Section 26 (2), Article VI of the 1987 Constitution,
petitioners have not convincingly shown grave abuse of
discretion on the part of Congress. Respect due to
co-equal departments of the government in matters
entrusted to them by the Constitution, and the absence
of a clear showing of grave abuse of discretion suffice to
stay the judicial hand.11
WHEREFORE, the petition is DISMISSED; and the
constitutionality and validity of Section 44 of RA 8189
UPHELD. No pronouncement as to costs.
PHILCONSA v. Gimenez (G.R. No. L-23326)
The constitutionality of Republic Act No. 3836 "insofar as
the same allows retirement gratuity and commutation of
vacation and sick leave to Senators and
Representatives, and to the elective officials of both
houses (of Congress)."
The suit was instituted by the Philippine Constitution
Association, Inc. (Philconsa, for short), a non-profit civic
organization, duly incorporated under Philippine laws, by
way of a petition for prohibition with preliminary
injunction to restrain the Auditor General of the
Philippines and the disbursing officers of both Houses of
Congress from "passing in audit the vouchers, and from
countersigning the checks or treasury warrants for the
payment to any former Senator or former Member of the
House of Representatives of retirement and vacation
gratuities pursuant to Republic Act No. 3836; and
likewise restraining the respondent disbursing officers of
the House and Senate, respectively, and their
successors in office from paying the said retirement and
vacation gratuities."
The challenge to the constitutionality of the law is
centered on the following propositions:
1. The provision for the retirement of the members and
certain officers of Congress is not expressed in the title
of the bill, in violation of section 21 (1) of Article VI of the
Constitution.
2. The provision on retirement gratuity is an attempt to
circumvent the Constitutional ban on increase of salaries

of the members of Congress during their term of office,
contrary to the provisions of Article VI, Section 14 of the
Constitution.
3. The same provision constitutes "selfish class
legislation" because it allows members and officers of
Congress to retire after twelve (12) years of service and
gives them a gratuity equivalent to one year salary for
every four years of service, which is not refundable in
case of reinstatement or re-election of the retiree, while
all other officers and employees of the government can
retire only after at least twenty (20) years of service and
are given a gratuity which is only equivalent to one
month salary for every year of service, which, in any
case, cannot exceed 24 months.
4. The provision on vacation and sick leave, commutable
at the highest rate received, insofar as members of
Congress are concerned, is another attempt of the
legislators to further increase their compensation in
violation of the Constitution.
The text of Republic Act No. 3836
The text of Republic Act No. 3836 reads:
AN ACT AMENDING SUBSECTION (c), SECTION
TWELVE OF COMMONWEALTH ACT NUMBERED
ONE HUNDRED EIGHTY-SIX, AS AMENDED BY
REPUBLIC ACT NUMBERED THIRTY HUNDRED
NINETY-SIX:
Be it enacted by the Senate and House of
Representatives of the Philippines in Congress
assembled:
SECTION 1. Subsection (c), Section twelve of
Commonwealth Act Numbered One Hundred eighty-six,
as amended by Republic Act Numbered Thirty hundred
ninety-six, is further amended to read as follows:
"Retirement is also allowed to a senator or a member of
the House of Representatives and to an elective officer
of either House of the Congress, regardless of age,
provided that in the case of a Senator or Member, he
must have served at least twelve years as a Senator
and/or as a member of the House of Representatives,
and, in the case of an elective officer of either House, he
must have served the government for at least twelve
years, not less than four years of which must have been
rendered as such elective officer: Provided, That the
gratuity payable to a retiring senator, member of the
House of Representatives, or elective officer, of either
House, shall be equivalent to one year's salary for every
four years of service in the government and the same
shall be exempt from any tax whatsoever and shall be
neither liable to attachment or execution nor refundable
in case of reinstatement or re-election of the retiree.
"This gratuity is payable by the employer or office
concerned which is hereby authorized to provide the
necessary appropriation or pay the same from any
unexpended items of appropriations or savings in its
appropriations or saving in its appropriations.
"Elective or appointive officials and employees paid
gratuity under this subsection shall be entitled to the
commutation of the unused vacation and sick leave,
based on the highest rate received, which they may
have to their credit at the time of retirement."
SECTION 2. This Act shall take effect upon its approval.
3
Approved, June 22, 1963.
The Solicitor General's Office, in representation of the
respondent, filed its answer on September 8, 1964, and
contends, by way of special and affirmative defenses
that:
1. The grant of retirement or pension benefits under
Republic Act No. 3836 to the officers objected to by the
petitioner does not constitute "forbidden compensation"
within the meaning of Section 14 of Article VI of the
Philippine Constitution.
2. The title of the law in question sufficiently complies
with the provisions of Section 21, Article VI, of the
Constitution that "no bill which may be enacted into law
shall embrace more than one subject which shall be
expressed in the title of the bill.
3. The law in question does not constitute legislation.
4. Certain indispensable parties, specifically the elected
officers of Congress who are authorized to approve
vouchers for payments for funds under the law in
question, and the claimants to the vouchers to be
presented for payment under said items, were not
included in the petition.
5. The petitioner has no standing to institute this suit.
6. The payment of commutable vacation and sick leave
benefits under the said Act is merely "in the nature of a
basis for computing the gratuity due each retiring
member" and, therefore, is not an indirect scheme to
increase their salary.
A brief historical background of Republic Act No. 3836
Republic Act No. 3836 was originally House Bill No.
6051, which was introduced by Congressmen Marcial R.
Pimentel of Camarines Norte and Marcelino R. Veloso of
the Third District of Leyte, on May 6, 1963. On the same
date, it was referred to the Committee on Civil Service.
which on the following May 8, submitted its REPORT
No. 3129, recommending approval of the bill with
amendments, among others, that the word "TWENTY" in
the bill as filed — representing the number of years that
a senator or member must serve in Congress to entitle
him to retirement under the bill — must be reduced to
"TWELVE" years, and that the following words were
inserted, namely, "AND THE SAME (referring to gratuity)
SHALL BE EXEMPT FROM ANY TAX WHATSOEVER
AND SHALL NOT BE LIABLE FROM ATTACHMENT OR
EXECUTION NOR REFUNDABLE IN CASE OF
REINSTATEMENT OR REELECTION OF THE
RETIREE." On May 8, 1963, the bill with the proposed
amendments was approved on second reading. It was
passed on third reading on May 13, 1963, and on the
same day was sent to the Senate, which, in turn, on May
23, 1963, passed it without amendment. The bill was
finally approved on June 22, 1963. As explained in the
EXPLANATORY NOTE attached to the bill, among
others —
The inclusion of members of Congress in subsection (c),
Section 12 of C.A. 186, as amended, will enable them to
retire voluntarily, regardless of age, after serving a
minimum of twenty years as a Member of Congress.
This gratuity will insure the security of the family of the
retiring member of Congress with the latter engaging in
other activities which may detract from his exalted
position and usefulness as lawmaker. It is expected that
with this assurance of security for his loved ones,

deserving and well-intentioned but poor men will be
attracted to serve their people in Congress.
As finally approved, the law (Subsection [c], paragraph
2, Section 1, R.A. 3836) allows a Senator or a Member
of the House of Representatives and an elective officer
of either House of Congress to retire regardless of age.
To be eligible for retirement, he must have served for at
least twelve years as such Senator and/or as member of
the House of Representatives. For an elective officer of
either House, he must have served the government for
at least twelve years, of which not less than four years
must have been rendered as such elective officer. The
gratuity payable by the employer or office concerned is
equivalent to one year's salary for every four years of
service in the government. Said gratuity is exempt from
taxation, not liable to attachment or execution, and not
refundable in case of reinstatement or re-election of the
retiree.
First legal point — personality of the Petitioner to
bring suit. YES (taxpayers)
The first point to be considered is whether petitioner
Philconsa has a standing to institute this action. This
Court has not hesitated to examine past decisions
involving this matter. This Court has repeatedly held that
when the petitioner, like in this case, is composed of
substantial taxpayers, and the outcome will affect their
vital interests, they are allowed to bring this suit.
(Pascual v. Secretary, G.R. No. L-10405, December 29,
1960; and Gonzales v. Hechanova, 60 Off. Gaz. 802
[1963]).
The petitioner, Philconsa, is precisely a non-profit, civic
organization composed of several leaders from all walks
of life whose main objective is to uphold the principles of
the Constitution.
The general view in the United States, which is followed
here, is stated in the American Jurisprudence, thus —
In the determination of the degree of interest essential to
give the requisite standing to attack the constitutionality
of a statute the general rule is that not only persons
individually affected, but also taxpayers have sufficient
interest in preventing the illegal expenditure of moneys
raised by taxation and may therefore question the
constitutionality of statutes requiring expenditure of
public moneys. (11 Am. Jur. 761; emphasis supplied.)
As far as the first point is concerned, We hold, therefore,
that the contention of the Solicitor General is
untenable.
Second legal point —Whether or not Republic Act
No. 3836 falls within the prohibition embodied in Art.
VI, section 14 of the Constitution. YES
The first constitutional question is whether Republic Act
3836 violates Section 14, Article VI, of the Constitution,
which reads as follows:
The senators and the Members of the House of
Representatives shall, unless otherwise provided by law,
receive an annual compensation of seven thousand two
hundred pesos each, including per diems and other
emoluments or allowances, and exclusive only of
travelling expenses to and from their respective districts
in the case of Members of the House of Representative
and to and from their places of residence in the case of
Senators, when attending sessions of the Congress. No
increase in said compensation shall take effect until after
4
the expiration of the full term of all the Members of the
Senate and of the House of Representatives approving
such increase. Until otherwise provided by law, the
President of the Senate and the Speaker of the House of
Representatives shall each receive an annual
compensation of sixteen thousand pesos (emphasis
supplied)
Before discussing this point, it is worthy to note that
the Constitution embodies some limitations and
prohibitions upon the members of Congress, to wit:
1. They may not hold any other office or employment
in the Government without forfeiting their respective
seats;
2. They shall not be appointed, during the time for
which they are elected, to any civil office which may
have been created or the emoluments whereof shall
have been increased while they were members of
Congress; (Section 16, Article VI, Constitution)
3. They cannot be financially interested in any
franchise;
4. They cannot appear in any civil case wherein the
Government is an adverse party;
5. They cannot appear as counsel before any
Electoral Tribunal; and
6. They cannot appear as counsel in any criminal
case where an officer or employee of the
Government is accused. (Section 17, Article VI,
Constitution)
In addition to the above prohibitions, the Anti-Graft Law
(Republic Act 3019) also prohibits members of Congress
to have any special interest in any specific business
which will directly or indirectly be favored by any law or
resolution authored by them during their term of office.
It is thus clear that the Constitutional Convention wisely
surrounded the Constitution with these limitations and
prohibitions upon Members of Congress. This is a
practical demonstration or application of the principle of
the and balances which is one of the peculiar
characteristics of our Constitution.
In the light of this background, can We conclude that
Congress can validly enact Republic Act 3836,
providing retirement benefits to its members,
without violating the provisions in the
aforementioned Article VI, Section 14, of the
Constitution, regarding increase of the
compensation act including other emoluments?
Likewise, it is significant that, as stated above, when the
Constitutional Convention first determined the
compensation for the Members of Congress, the amount
fixed by it was only P5,000.00 per annum, but it
embodies a special proviso which reads as follows: "No
increase in said compensation shall take effect until after
the expiration of the full term of all the members of the
National Assembly elected subsequent to approval of
such increase." In other words, under the original
constitutional provision regarding the power of the
National Assembly to increase the salaries of its
members, no increase would take effect until after the
expiration of the full term of the members of the
Assembly elected subsequent to the approval of such
increase. (See Aruego, The Framing of the Constitution,

Vol. 1, pp. 296-300; Sinco, Philippine Government and
Political Law, 4th ed., p. 187)
This goes to show how zealous were the members of
the Constitutional Convention in guarding against the
temptation for members of Congress to increase their
salaries. However, the original strict prohibition was
modified by the subsequent provision when the
Constitutional amendments were approved in 19402
The Constitutional provision in the aforementioned
Section 14, Article VI, includes in the term
compensation "other emoluments." This is the
pivotal point on this fundamental question as to
whether the retirement benefits as provided for in
Republic Act 3836 fall within the purview of the term
"other emoluments."
Most of the authorities and decided cases have regarded
"emolument" as "the profit arising from office or
employment; that which is received as
compensation for services or which is annexed to
the possession of an office, as salary, fees and
perquisites.3
In Schieffelin v. Berry, 216 N.Y.S. (citing Wright v. Craig,
202 App. Div. 684, 195 N.Y.S. 391, affirmed 234 N.Y.
548, 138 N.E. 441), it has been established that
pensions and retirement allowances are part of
compensation of public officials; otherwise their payment
would be unconstitutional.
In another case, State v. Schmahl, 145 N.W. 795, 125
Minn. 104, the word "emoluments" does not refer to the
fixed salary alone, but includes fees and compensation
as the incumbent of the office is by law entitled to
receive because he holds such office and performed
some service required of the occupant thereof."
From the decisions of these cases, it is evident that
retirement benefit is a form or another species of
emolument, because it is a part of compensation for
services of one possessing any office.
Republic Act No. 3836 provides for an increase in the
emoluments of Senators and Members of the House of
Representatives, to take effect upon the approval of said
Act, which was on June 22, 1963. Retirement benefits
were immediately available thereunder, without awaiting
the expiration of the full term of all the Members of the
Senate and the House of Representatives approving
such increase. Such provision clearly runs counter to the
prohibition in Article VI, Section 14 of the Constitution.
Third Legal Point — Whether or not the law in
question violates the equal protection clause of the
Constitution. Yes
Another reason in support of the conclusion reached
herein is that the features of said Republic Act 3836 are
patently discriminatory, and therefore violate the equal
protection clause of the Constitution. (Art. III, Sec. 1,
part. 1.)
In the first place, while the said law grants retirement
benefits to Senators and Members of the House of
Representatives who are elective officials, it does not
include other elective officials such as the governors of
provinces and the members of the provincial boards, and
the elective officials of the municipalities and chartered
cities.
5
The principle of equal protection of law embodied in our
Constitution has been fully explained by Us in the case
of People v. Vera, 65 Phil. 56, 126, where We stated that
the classification to be reasonable must be based upon
substantial distinctions which make real differences and
must be germane to the purposes of the law.
As well stated by Willoughby on the Constitution of the
United States (second edition), p. 1937, the principle of
the requirement of equal protection of law applies to all
persons similarly situated. Why limit the application of
the benefits of Republic Act 3836 to the elected
members of Congress? We feel that the classification
here is not reasonable.
Secondly, all members of Congress under Republic Act
3836 are given retirement benefits after serving twelve
years, not necessarily continuous, whereas, most
government officers and employees are given retirement
benefits after serving for at least twenty years. In fact,
the original bill of Act 3836 provided for twenty years of
service.
In the third place, all government officers and employees
are given only one retirement benefit irrespective of their
length of service in the government, whereas, under
Republic Act 3836, because of no age limitation, a
Senator or Member of the House of Representatives
upon being elected for 24 years will be entitled to two
retirement benefits or equivalent to six years' salary.
Lastly, it is peculiar that Republic Act 3836 grants
retirement benefits to officials who are not members of
the Government Service Insurance System. Most
grantees of retirement benefits under the various
retirement laws have to be members or must at least
contribute a portion of their monthly salaries to the
System.4
The arguments advanced against the discriminatory
features of Republic Act 3836, as far as Members of
Congress are concerned, apply with equal force to the
elected officers of each House, such as the Secretaries
and the Sergeants-at-arms. Under Republic Act 3836,
the Secretaries and Sergeants-at-arms of each House
are given the benefits of retirement without having
served for twenty years as required with other officers
and employees of the Government.
Fourth Legal Point — Whether or not the title of
Republic Act No. 3836 is germane to the subject
matter expressed in the act. No
Another Constitutional point to determine is whether the
title of Republic Act 3836 complies with the requirement
of paragraph 1, section 21, Article VI of the Constitution,
which reads as follows:
No bill which may be enacted into law shall embrace
more than one subject which shall be expressed in the
It is to be observed that under Republic Act 3836,
amending the first paragraph of section 12, subsection
(c) of Commonwealth Act 186, as amended by Republic
Acts Nos. 660 and. 3096, the retirement benefits are
granted to members of the Government Service
Insurance System, who have rendered at least twenty
years of service regardless of age. This paragraph is
related and germane to the subject of Commonwealth
Act No. 186.
On the other hand, the succeeding paragraph of
Republic Act 3836 refers to members of Congress and

to elective officers thereof who are not members of the
Government Service Insurance System. To provide
retirement benefits, therefore, for these officials, would
relate to subject matter which is not germane to
Commonwealth Act No. 186. In other words, this portion
of the amendment (re retirement benefits for Members of
Congress and elected officers, such as the Secretary
and Sergeants-at-arms for each House) is not related
in any manner to the subject of Commonwealth Act
186 establishing the Government Service Insurance
System and which provides for both retirement and
insurance benefits to its members.
Parenthetically, it may be added that the purpose of the
requirement that the subject of an Act should be
expressed in its title is fully explained by Cooley, thus:
(1) to prevent surprise or fraud upon the Legislature; and
(2) to fairly apprise the people, through such publication
of legislation that are being considered, in order that they
may have the opportunity of being heard thereon by
petition or otherwise, if they shall so desire (Cooley,
Constitutional Limitations, 8th ed., Vol. 1, p. 162; See
also Martin, Political Law Reviewer, Book One [1965], p.
119)
With respect to sufficiency of title this Court has ruled in
two cases:
The Constitutional requirement with respect to titles of
statutes as sufficient to reflect their contents is satisfied if
all parts of a law relate to the subject expressed in its
title, and it is not necessary that the title be a complete
index of the content. (People v. Carlos, 78 Phil. 535)
The Constitutional requirement that the subject of an act
shall be expressed in its title should be reasonably
construed so as not to interfere unduly with the
enactment of necessary legislation. It should be given a
practical, rather than technical, construction. There
should be sufficient compliance with such a requirement
if the title expresses the general subject and all the
provisions of the statute are germane to that general
subject. (Sumulong v. The Commission on Elections, 73
Phil. 288, 291)
The requirement that the subject of an act shall be
expressed in its title is wholly illustrated and explained in
Central Capiz v. Ramirez, 40 Phil. 883. In this case, the
question raised was whether Commonwealth Act 2784,
known as the Public Land Act, was limited in its
application to lands of the public domain or whether its
provisions also extended to agricultural lands held in
private ownership. The Court held that the act was
limited to lands of the public domain as indicated in its
title, and did not include private agricultural lands. The
Court further stated that this provision of the Constitution
expressing the subject matter of an Act in its title is not a
mere rule of legislative procedure, directory to Congress,
but it is mandatory. It is the duty of the Court to declare
void any statute not conforming to this constitutional
provision. (See Walker v. State, 49 Alabama 329;
Cooley, Constitutional Limitations, pp. 162-164;5 See
also Agcaoili v. Suguitan, 48 Phil. 676; Sutherland on
Statutory Construction, Sec. 111.)
In the light of the history and analysis of Republic Act
3836, We conclude that the title of said Republic Act
3836 is void as it is not germane to the subject matter
and is a violation of the aforementioned paragraph 1,
section 21, Article VI of the Constitution.
6
In short, Republic Act 3836 violates three
constitutional provisions, namely: first, the
prohibition regarding increase in the salaries of
Members of Congress; second, the equal protection
clause; and third, the prohibition that the title of a
bill shall not embrace more than one subject.
IN VIEW OF THE FOREGOING CONSIDERATIONS,
Republic Act No. 3836 is hereby declared null and
void, in so far as it refers to the retirement of Members
of Congress and the elected officials thereof, as being
unconstitutional. The restraining order issued in our
resolution on December 6, 1965 is hereby made
permanent. No costs.
G.R. No. 124360 November 5, 1997 FRANCISCO S.
TATAD, petitioner, Vs. THE SECRETARY OF THE
DEPARTMENT OF ENERGY AND THE SECRETARY
OF THE DEPARTMENT OF FINANCE,
PUNO, J.:
The petitions at bar challenge the constitutionality of
Republic Act No. 8180 entitled "An Act Deregulating the
Downstream Oil Industry and For Other Purposes".1 R.A.
No. 8180 ends twenty six (26) years of government
regulation of the downstream oil industry. Few cases
carry a surpassing importance on the life of every
Filipino as these petitions for the upswing and
downswing of our economy materially depend on the
oscillation of oil.
First, the facts without the fat. Prior to 1971, there was
no government agency regulating the oil industry other
than those dealing with ordinary commodities. Oil
companies were free to enter and exit the market without
any government interference. There were four (4)
refining companies (Shell, Caltex, Bataan Refining
Company and Filoil Refining) and six (6) petroleum
marketing companies (Esso, Filoil, Caltex, Getty, Mobil
and Shell), then operating in the country.2
In 1971, the country was driven to its knees by a
crippling oil crisis. The government, realizing that
petroleum and its products are vital to national security
and that their continued supply at reasonable prices is
essential to the general welfare, enacted the Oil Industry
Commission Act.3 It created the Oil Industry Commission
(OIC) to regulate the business of importing, exporting,
re-exporting, shipping, transporting, processing, refining,
storing, distributing, marketing and selling crude oil,
gasoline, kerosene, gas and other refined petroleum
products. The OIC was vested with the power to fix the
market prices of petroleum products, to regulate the
capacities of refineries, to license new refineries and to
regulate the operations and trade practices of the
industry.4
All the oil refineries and marketing companies were
owned by foreigners whose economic interests did
not always coincide with the interest of the Filipino.
Crude oil was transported to the country by
foreign-controlled tankers. Crude processing was
done locally by foreign-owned refineries and
petroleum products were marketed through
foreign-owned retail outlets.
On November 9, 1973, President Ferdinand E. Marcos
boldly created the Philippine National Oil Corporation
(PNOC) to break the control by foreigners of our oil
industry.5 PNOC engaged in the business of refining,

marketing, shipping, transporting, and storing petroleum.
It acquired ownership of ESSO Philippines and Filoil to
serve as its marketing arm. It bought the controlling
shares of Bataan Refining Corporation, the largest
refinery in the country.6 PNOC later put up its own
marketing subsidiary — Petrophil. PNOC operated under
the business name PETRON Corporation. For the first
time, there was a Filipino presence in the Philippine oil
market.
In 1984, President Marcos through Section 8 of
Presidential Decree No. 1956, created the Oil Price
Stabilization Fund (OPSF) to cushion the effects of
frequent changes in the price of oil caused by exchange
rate adjustments or increase in the world market prices
of crude oil and imported petroleum products. The fund
is used (1) to reimburse the oil companies for cost
increases in crude oil and imported petroleum products
resulting from exchange rate adjustment and/or increase
in world market prices of crude oil, and (2) to reimburse
oil companies for cost under recovery incurred as a
result of the reduction of domestic prices of petroleum
products. Under the law, the OSPF may be sourced
from:
1. any increase in the tax collection from ad valorem tax
or customs duty imposed on petroleum products subject
to tax under P.D. No. 1956 arising from exchange rate
adjustment,
2. any increase in the tax collection as a result of the
lifting of tax exemptions of government corporations, as
may be determined by the Minister of Finance in
consultation with the Board of Energy,
3. any additional amount to be imposed on petroleum
products to augment the resources of the fund through
an appropriate order that may be issued by the Board of
Energy requiring payment of persons or companies
engaged in the business of importing, manufacturing
and/or marketing petroleum products, or
4. any resulting peso costs differentials in case the
actual peso costs paid by oil companies in the
importation of crude oil and petroleum products is less
than the peso costs computed using the reference
foreign exchange rate as fixed by the Board of Energy.7
By 1985, only three (3) oil companies were operating in
the country — Caltex, Shell and the government-owned
PNOC.
In May, 1987, President Corazon C. Aquino signed
Executive Order No. 172 creating the Energy Regulatory
Board to regulate the business of importing, exporting,
re-exporting, shipping, transporting, processing, refining,
marketing and distributing energy resources "when
warranted and only when public necessity requires." The
Board had the following powers and functions:
1. Fix and regulate the prices of petroleum products;
2. Fix and regulate the rate schedule or prices of piped
gas to be charged by duly franchised gas companies
which distribute gas by means of underground pipe
system;
3. Fix and regulate the rates of pipeline concessionaires
under the provisions of R.A. No. 387, as amended . . . ;
4. Regulate the capacities of new refineries or additional
capacities of existing refineries and license refineries
that may be organized after the issuance of (E.O. No.
172) under such terms and conditions as are consistent
with the national interest; and
5. Whenever the Board has determined that there is a
shortage of any petroleum product, or when public
interest so requires, it may take such steps as it may
consider necessary, including the temporary adjustment
of the levels of prices of petroleum products and the
payment to the Oil Price Stabilization Fund . . . by
7
persons or entities engaged in the petroleum industry of
such amounts as may be determined by the Board,
which may enable the importer to recover its cost of
importation.8
On December 9, 1992, Congress enacted R.A. No. 7638
which created the Department of Energy to prepare,
integrate, coordinate, supervise and control all plans,
programs, projects, and activities of the government in
relation to energy exploration, development, utilization,
distribution and conservation.9 The thrust of the
Philippine energy program under the law was toward
privatization of government agencies related to energy,
deregulation of the power and energy industry and
reduction of dependency on oil-fired plants.10 The law
also aimed to encourage free and active participation
and investment by the private sector in all energy
activities. Section 5(e) of the law states that "at the end
of four (4) years from the effectiveness of this Act, the
Department shall, upon approval of the President,
institute the programs and timetable of deregulation of
appropriate energy projects and activities of the energy
industry."
In March 1996, Congress took the audacious step of
deregulating the downstream oil industry. It enacted R.A.
No. 8180, entitled the "Downstream Oil Industry
Deregulation Act of 1996." Under the deregulated
environment, "any person or entity may import or
purchase any quantity of crude oil and petroleum
products from a foreign or domestic source, lease or
own and operate refineries and other downstream oil
facilities and market such crude oil or use the same for
his own requirement," subject only to monitoring by the
Department of Energy.11
The deregulation process has two phases: the transition
phase and the full deregulation phase. During the
transition phase, controls of the non-pricing aspects of
the oil industry were to be lifted. The following were to be
accomplished:
(1) liberalization of oil importation, exportation,
manufacturing, marketing and distribution,
(2) implementation of an automatic pricing mechanism,
(3) implementation of an automatic formula to set
margins of dealers and rates of haulers, water transport
operators and pipeline concessionaires, and
(4) restructuring of oil taxes. Upon full deregulation,
controls on the price of oil and the foreign exchange
cover were to be lifted and the OPSF was to be
abolished.
The petitions at bar assail the constitutionality of various
provisions of R.A No. 8180 and E.O. No. 372.
In G.R. No. 124360, petitioner Francisco S. Tatad seeks
the annulment of section 5(b) of R.A. No. 8180. Section
5(b) provides:
b) Any law to the contrary notwithstanding and starting
with the effectivity of this Act, tariff duty shall be imposed
and collected on imported crude oil at the rate of three
percent (3%) and imported refined petroleum products at
the rate of seven percent (7%), except fuel oil and LPG,
the rate for which shall be the same as that for imported
crude oil: Provided, That beginning on January 1, 2004
the tariff rate on imported crude oil and refined
petroleum products shall be the same: Provided, further,
That this provision may be amended only by an Act of
Congress.
The petition is anchored on three arguments:

First, that the imposition of different tariff rates on
imported crude oil and imported refined petroleum
products violates the equal protection clause.
Second, that the imposition of different tariff rates does
not deregulate the downstream oil industry but instead
controls the oil industry, contrary to the avowed policy of
the law. Thus, it runs counter to the objective of the law
"to foster a truly competitive market."
Third, the inclusion of the tariff provision in section 5(b)
of R.A. No. 8180 violates Section 26(1) Article VI of the
Constitution requiring every law to have only one subject
which shall be expressed in its title. Petitioner contends
that the imposition of tariff rates in section 5(b) of R.A.
No. 8180 is foreign to the subject of the law which is the
deregulation of the downstream oil industry.
Issues :
● section 15 of R.A. No. 8180 constitutes an
undue delegation of legislative power to the
President and the Secretary of Energy because
it does not provide a determinate or
determinable standard to guide the Executive
Branch in determining when to implement the
full deregulation of the downstream oil industry.
Petitioners contend that the law does not define when it
is practicable for the Secretary of Energy to recommend
to the President the full deregulation of the downstream
oil industry or when the President may consider it
practicable to declare full deregulation. Also, the law
does not provide any specific standard to determine
when the prices of crude oil in the world market are
considered to be declining nor when the exchange rate
of the peso to the US dollar is considered stable.
● petitioners aver that E.O. No. 392 implementing
the full deregulation of the downstream oil
industry is arbitrary and unreasonable because it
was enacted due to the alleged depletion of the
OPSF fund — a condition not found in R.A. No.
8180.
● Third, section 15 of R.A. No. 8180 and E.O. No.
392 allow the formation of a de facto cartel
among the three existing oil companies —
Petron, Caltex and Shell — in violation of the
constitutional prohibition against monopolies,
combinations in restraint of trade and unfair
competition.
We shall now resolve the petitions on the merit. The
petitions raise procedural and substantive issues bearing
on the constitutionality of R.A. No. 8180 and E.O. No.
392. The procedural issues are: (1) whether or not the
petitions raise a justiciable controversy, and (2) whether
or not the petitioners have the standing to assail the
validity of the subject law and executive order. The
substantive issues are: (1) whether or not section 5 (b)
violates the one title — one subject requirement of the
Constitution; (2) whether or not the same section
violates the equal protection clause of the Constitution;
(3) whether or not section 15 violates the constitutional
prohibition on undue delegation of power; (4) whether or
not E.O. No. 392 is arbitrary and unreasonable; and (5)
whether or not R.A. No. 8180 violates the constitutional
prohibition against monopolies, combinations in restraint
of trade and unfair competition.
In constitutional parlance, respondents contend that the
petitions failed to raise a justiciable controversy.
8
Even a side glance at the petitions will reveal that
petitioners have raised constitutional issues which
deserve the resolution of this Court in view of their
seriousness and their value as precedents. Our
statement of facts and definition of issues clearly show
that petitioners are assailing R.A. No. 8180 because its
provisions infringe the Constitution and not because the
law lacks wisdom. The principle of separation of power
mandates that challenges on the constitutionality of a
law should be resolved in our courts of justice while
doubts on the wisdom of a law should be debated in the
halls of Congress.
This Court has brightlined its liberal stance on a
petitioner's locus standi where the petitioner is able to
craft an issue of transcendental significance to the
people.15
Senator Tatad, it is contended that section 5(b) of R.A.
No. 8180 on tariff differential violates the provision17 of
the Constitution requiring every law to have only one
subject which should be expressed in its title. We do not
concur with this contention.
We have consistently ruled18 that the title need not
mirror, fully index or catalogue all contents and minute
details of a law. A law having a single general subject
indicated in the title may contain any number of
provisions, no matter how diverse they may be, so long
as they are not inconsistent with or foreign to the general
subject, and may be considered in furtherance of such
subject by providing for the method and means of
carrying out the general subject.19 We hold that section
5(b) providing for tariff differential is germane to the
subject of R.A. No. 8180 which is the deregulation of the
downstream oil industry.
We shall now slide to the substantive issues in G.R. No.
127867. Petitioners assail section 15 of R.A. No. 8180
which fixes the time frame for the full deregulation of the
downstream oil industry.
Petitioners urge that the phrases "as far as practicable,"
"decline of crude oil prices in the world market" and
"stability of the peso exchange rate to the US dollar" are
ambivalent, unclear and inconcrete in meaning. They
submit that they do not provide the "determinate or
determinable standards" which can guide the President
in his decision to fully deregulate the downstream oil
industry. In addition, they contend that E.O. No. 392
which advanced the date of full deregulation is void for it
illegally considered the depletion of the OPSF fund as a
factor.
We delineated the metes and bounds of these tests in
Eastern Shipping Lines, Inc. VS. POEA,22 thus:
There are two accepted tests to determine whether
or not there is a valid delegation of legislative power,
viz:
1. the completeness test and the sufficient
standard test. Under the first test, the law must
be complete in all its terms and conditions when
it leaves the legislature such that when it
reaches the delegate the only thing he will have
to do is to enforce it.
2. Under the sufficient standard test, there must be
adequate guidelines or limitations in the law to
map out the boundaries of the delegate's
authority and prevent the delegation from
running riot.
Both tests are intended to prevent a total transference of
legislative authority to the delegate, who is not allowed

to step into the shoes of the legislature and exercise a
power essentially legislative.
Given the groove of the Court's rulings, the attempt of
petitioners to strike down section 15 on the ground of
undue delegation of legislative power cannot prosper.
Section 15 can hurdle both the completeness test and
the sufficient standard test. It will be noted that Congress
expressly provided in R.A. No. 8180 that full
deregulation will start at the end of March 1997,
regardless of the occurrence of any event. Full
deregulation at the end of March 1997 is mandatory and
the Executive has no discretion to postpone it for any
purported reason. Thus, the law is complete on the
question of the final date of full deregulation. The
discretion given to the President is to advance the date
of full deregulation before the end of March 1997.
Section 15 lays down the standard to guide the judgment
of the President — he is to time it as far as practicable
when the prices of crude oil and petroleum products in
the world market are declining and when the exchange
rate of the peso in relation to the US dollar is stable.
1. No, R.A. No. 8180 is unconstitutional. It violated
Section 19, Article XII of the Constitution prohibiting
monopolies, combinations in restraint of trade and unfair
competition. The deregulation act only benefits Petron,
Shell and Caltex, the three major league players in the
oil industry.
2. Yes, Executive Order No. 392 was arbitrary and
unreasonable and therefore considered void. The
depletion of OFSP is not one of the factors enumerated
in R.A. No. 8180 to be considered in declaring full
deregulation of the oil industry. Therefore, the executive
department, in its declaration of E.O. No. 392, failed to
follow faithfully the standards set in R.A. No. 8180,
making it void.
3. No, section 5 of R.A. No. 8180 does not violate
Section 26(1), Article VI of the Constitution. A law having
a single general subject indicated in the title may contain
any number of provisions as long as they are not
inconsistent with the foreign subject. Section 5 providing
for tariff differential is germane to the subject of the
deregulation of the downstream industry which is R.A.
No 8180, therefore it does not violate the one title-one
subject rule.
4. No, Section 15 did not violate the constitutional
prohibition on undue delegation of legislative power. The
tests to determine the validity of delegation of legislative
power are the completeness test and the sufficiency test.
The completeness test demands that the law must be
complete in all its terms and conditions such that when it
reaches the delegate, all it must do is enforce it. The
sufficiency test demand an adequate guideline or
limitation in the law to delineate the delegate’s authority.
Section 15 provides for the time to start the full
deregulation, which answers the completeness test. It
also laid down standard guide for the judgement of the
President- he is to time it as far as practicable when the
prices of crude oil and petroleum products in the world
market are declining and when the exchange rate of
peso to dollar is stable- which answers the sufficiency
test.
Decision:
9
The petitions were granted. R.A. No. 8180 was declared
unconstitutional and E.O. No. 372 void.
Tio v. Videogram Regulatory Board (G.R. No. 75697)
Facts
Valentin Tio is a videogram establishment operator
adversely affected by Presidential Decree No. 1987
entitled “An Act Creating the Videogram Regulatory
Board”.
P.D. No. 1987 provides for the levy of a tax over each
cassette sold (Sec. 134) and a 30% tax on the gross
receipts of a videogram establishment, payable to the
local government (Sec. 10). The rationale for this decree
is set forth in its preambulatory/whereas clauses to wit:
1.WHEREAS, the proliferation and unregulated
circulation of videograms including, among others,
videotapes, discs, cassettes … have greatly prejudiced
the operations of movie houses and theaters, and have
caused a sharp decline in theatrical attendance by at
least forty percent (40%) and a tremendous drop in the
collection of [taxes] thereby resulting in substantial
losses estimated at P450 Million annually in government
revenues;
2. WHEREAS, videogram(s) establishments collectively
earn around P600 Million per annum from rentals, sales
and disposition of videograms, and such earnings have
not been subjected to tax, thereby depriving the
Government of approximately P180 Million in taxes each
year;
3. WHEREAS, the unregulated activities of videogram
establishments have also affected the viability of the
movie industry, …;
5. WHEREAS, proper taxation of the activities of
videogram establishments will not only alleviate the dire
financial condition of the movie industry …, but also
provide an additional source of revenue for the
Government, and at the same time rationalize the
heretofore uncontrolled distribution of videograms;
6. WHEREAS, the rampant and unregulated showing of
obscene videogram features constitutes a clear and
present danger to the moral and spiritual well-being of
the youth, and impairs the mandate of the Constitution
for the State to support the rearing of the youth for civic
efficiency and the development of moral character and
promote their physical, intellectual, and social well-being;
8. WHEREAS, in the face of these grave emergencies
corroding the moral values of the people and betraying
the national economic recovery program, bold
emergency measures must be adopted with dispatch;
(emphasis supplied and certain passages omitted)
ISSUE:
Whether or not the imposition of the 30% tax is a rider
and the same is not germane to the subject matter of the
law.
HELD:
The tax is not a rider and is germane to the purpose and
subject of the law.
The Constitutional requirement that “every bill shall
embrace only one subject which shall be expressed in
the title thereof” is sufficiently complied with if the title be
comprehensive enough to include the general purpose

which a statute seeks to achieve. It is not necessary that
the title express each and every end that the statute
wishes to accomplish. The requirement is satisfied if all
the parts of the statute are related, and are germane to
the subject matter expressed in the title, or as long as
they are not inconsistent with or foreign to the general
subject and title.
Reading section 10 of P.D. No. 1987 closely, one can
see that the foregoing provision is allied and germane to,
and is reasonably necessary for the accomplishment of,
the general object of the law, which is the regulation of
the video industry through the Videogram Regulatory
Board as expressed in its title. The tax provision is not
inconsistent with, nor foreign to that general subject and
title. As a tool for regulation it is simply one of the
regulatory and control mechanisms scattered throughout
the decree.
Aside from revenue collection, tax laws may also be
enacted for the purpose of regulating an activity. At the
same time, the videogram industry is also an untapped
source of revenue which the government may validly tax.
All of this is evident from preambulatory clauses nos. 2,
5, 6 and 8, quoted in part above.
The levy of the 30% tax is also for a public purpose. It
was imposed primarily to answer the need for regulating
the video industry, particularly because of the rampant
film piracy, the flagrant violation of intellectual property
rights, and the proliferation of explicit video tapes. And
while it was also an objective of the law to protect the
movie industry, the tax remains a valid imposition.
In fine, the petitioner has not overcome the presumption
of validity which attaches to a challenged statute. We
find no clear violation of the Constitution which would
justify us in pronouncing Presidential Decree No. 1987
as unconstitutional and void.
WHEREFORE, the instant Petition is hereby dismissed.
Philippine Judges Association v. Prado
(G.R.No.105371)
The Court will not look into alleged inconsistencies in the
enactment of a statute when the enrolled bill and
legislative journal both certify its validity.
Facts:
RA 7354 entitled “An Act Creating the Phil Postal Corp,
Defining its Powers, Functions and Responsibilities,
Providing for Regulation of the Industry and for Other
Purposes Connected Therewith” provides in sec 35
thereof that all franking privileges authorized by law are
thereby repealed with some exceptions. It thus withdrew
the franking privilege of the SC, CA and trial courts of
the Phils among other agencies. Petitioners argue,
among others, that Sec 35 is not expressed in the title of
the law, nor does it reflect its purposes contrary to Art VI,
Sec 26(1) of the Constitution. They further argue that
Sec 35 was not included in the original version of the
Senate and House bill from which RA 7354 evolved. As
that appeared only in the Conference Committee Report
10
after the last reading of the bill, its addition, they allege,
violates Art VI, Sec 26(2) of the Constitution.
Issues:
(1) Is Sec 35 germane to the subject expressed in the
title?
(2) Was RA 7354 duly enacted in accordance with Art VI,
Sec 26(2)?
Held:
(1) Yes. Art VI, Sec 26(1) was not violated. Where a
statute repeals a former law, such repeal is the effect
and not the subject of the statute; and it is the subject,
not the effect of a law, which is required to be briefly
expressed in its title. It was never claimed that every
other Act which the new Act repeals or alters by
implication must be mentioned in the title of the latter.
(2) Yes. Aside from holding that the Conference
Committee may deal generally with subject matter and
not merely limited to resolving differences between the
two Houses, the Court declined to look into the charges
that RA 7354 was not enacted with the formalities
mandated by the Constitution in Art VI Sec 26(2) holding
that both the enrolled bill and legislative journals certify
that the measure was duly enacted in accordance to
said constitutional mandate. The Court held that it is
bound by such official assurances from a coordinate
department of the govt, to which it owes, at the very
least, a becoming courtesy.
* Sec. 35 was, however, declared nonetheless
unconstitutional for violation of the constitutional equal
protection clause (Art III, Sec 1). (Philippine Judges
Assoc. v. Prado, 227 SCRA 703)
G.R. No. L-24396 – 24 SCRA 172
In 1961, Republic Act No. 3043 (An Act to Further
Amend Commonwealth Act Numbered One Hundred
Twenty, as Amended by Republic Act Numbered Twenty
Six Hundred and Forty One) was passed. This law
amended the charter of NAPOCOR (National Power
Corporation). Section 3 of RA 3043 provides that:
a. contractors being supplied by NAPOCOR shall not
exceed an annual profit of 12%;
b. if they do, they shall refund such excess to their
customers;
c. that NAPOCOR has the power to renew all existing
contracts with franchise holders for the supply of energy.
Santiago Alalayan and the Philippine Power and
Development Company (PPDC) assailed the said
provision. They averred that Section 3 is a rider because
first, it was not included in the title of the amending law
nor was it included in the amended law. Second, the
main purpose of RA 3043 was to increase the capital
stock of NAPOCOR hence Alalayan et al believed that
Section 3 was not germane to RA 3043.
ISSUE: Whether or not Section 3 of RA 3043 is
constitutional.
HELD: Yes. The Supreme Court simply ruled that the
Constitution does not require Congress to employ in the

title of an enactment, language of such precision as to
mirror, fully index or catalogue all the contents and the
minute details therein. It suffices if the title should serve
the purpose of the constitutional demand that it inform
the legislators, the persons interested in the subject of
the bill, and the public, of the nature, scope and
consequences of the proposed law and its operation.
And this, to lead them to inquire into the body of the bill,
study and discuss the same, take appropriate action
thereon, and, thus, prevent surprise or fraud upon the
legislators.
LEONEN, J.:
The consolidated cases must be dismissed, as the
issues they raise were rendered moot by the passage of
Republic Act No. 11590 which amended the National
Internal Revenue Code, codified the 5% franchise tax on
gaming operations of Philippine Offshore Gaming
Operators (POGOs), and considered the operations of
offshore gaming licensees as doing business in the
Philippines, among others.
In any case, the assailed issuances are not
unconstitutional.
The assailed statute, Republic Act No. 11494, or the
"Bayanihan to Recover As One Act" (Bayanihan 2), is an
emergency measure enacted by the legislature which
the President deemed necessary and urgent to address
the pandemic. It enjoys a presumption of constitutionality
which petitioners did not overcome.
The Bayanihan 2 does not violate the "one subject, one
title" rule in Article VI, Section 26(1) of the Constitution.[1]
The title of the law is clear, "An Act Providing for
COVID-19 Response and Recovery Interventions and
Providing Mechanisms to Accelerate the Recovery and
Bolster the Resiliency of the Philippine Economy,
Providing Funds Therefor, and for Other Purposes." It
sought to "[e]nhance the financial stability of the country
to support government programs in combatting the
COVID-19 pandemic."[2]
Sections 11(f) and (g) which outlined the taxes imposed
on POGOs cannot be deemed riders when they are
undoubtedly germane to the subject matter of the
Bayanihan 2. Dismissing the provisions as tax measures
irrelevant to the statute's purpose—to provide the
sources of funds for the various government projects to
meet the pandemic—is grasping at straws.
Further, the imposition of a 5% franchise tax, in lieu of
other taxes, on the gaming operations of offshore
gaming licensees, whether they be Philippine- or
foreign-based, was not introduced by Bayanihan 2. It is
not a new tax measure.
Presidential Decree No. 1869 created the Philippine
Amusement and Gaming Corporation (PAGCOR) to
"centralize and integrate the right and authority to
operate and conduct games of chance"[3] and conferred
it with broad powers.[4] PAGCOR was granted "the rights,
privileges and authority to operate and license gambling
casinos, gaming clubs and other similar recreation or
amusement places, gaming pools, i.e. basketball,
football, bingo, etc. except jai-alai, whether on land or
sea, within the territorial jurisdiction of the Republic of
11
the Philippines: Provided, That the corporation shall
obtain the consent of the local government unit that has
territorial jurisdiction over the area chosen as the site for
any of its operations."[5]
Under Presidential Decree No. 1869, PAGCOR
franchise holders are assessed and held liable for a
franchise tax of 5% of the gross revenue or earnings
derived from operations under the franchise, in lieu of all
taxes.[6]
In line with its aim to "[e]nsure that online games are
properly regulated and monitored,"[7] PAGCOR issued
the Rules and Regulations for Philippine Offshore
Gaming Operations on September 1, 2016. It provided
the requirements for an offshore gaming license and the
grounds for its suspension and cancellation.
On February 2, 2017, Executive Order No. 13, series of
2017 was issued, titled "Strengthening the Fight against
Illegal Gambling and Clarifying the Jurisdiction and
Authority of Concerned Agencies in the Regulation and
Licensing of Gambling and Online Gaming Facilities, and
for Other Purposes." It reiterated the jurisdiction of
concerned agencies, among which is PAGCOR, in
regulating online gaming operations. It stated that
"nothing shall prohibit the duly licensed online gambling
operator from allowing the participation of persons
physically located outside Philippine territory."
On December 27, 2017, the Bureau of Internal Revenue
issued Revenue Memorandum Circular No. 102-17 on
the "Taxation of Taxpayers Engaged in Philippine
Offshore Gaming Operations." This was later followed by
Revenue Memorandum Circular No. 78-2018 which
outlined the registration process for offshore gaming
operations.
The Commissioner of Internal Revenue who has the
exclusive and original jurisdiction "to interpret provisions
of the Tax Code and other tax laws,"[8] was well within its
rights when it issued the revenue circulars. The 5%
franchise tax, in lieu of other taxes on PAGCOR
licensees, was not newly imposed by the agency, but
was provided for in Presidential Decree No. 1869. Thus,
in its interpretation of existing tax laws on PAGCOR
licensees and its issuance of Revenue Memorandum
Circular Nos. 102-17 and 78-2018, the Commissioner of
Internal Revenue did not encroach upon the legislative
power to impose taxes. It merely issued guidelines to
clarify existing tax measures.
The ponencia harps on territoriality issues. However,
there is merit in respondents' argument that "what is
being collected is a tax not based on income, but rather,
on the exercise of a privilege."[9] We have allowed
POGOs to operate under licenses that the PAGCOR
issued. We cannot, on one hand, issue offshore gaming
licenses to POGOs, and on the same breath, reject their
taxability. When we let licensees operate in the
Philippines, pass through our borders, and set up game
servers in the country,[10] it is not unreasonable nor
unconstitutional to impose the same 5% franchise tax
which is collected from other PAGCOR franchise
holders.
It was an error for petitioners to argue that
Philippine-based and offshore POGO licensees must be
treated differently, considering that PAGCOR, the
agency that regulates their operations, issues the same
gaming license to both. The 5% franchise tax was
imposed by virtue of their license to operate. Petitioner

Saint Wealth's argument that it should not be subjected
to any Philippine tax since all of its operations are
located abroad[11] and offshore-based POGO licensees
must be similarly treated with foreign corporations not
engaged in trade or business in the Philippines[12] is
untenable. Precisely, its game servers are here because
they could not operate in their home country. Thus,
offshore-based POGO licensees granted franchises by
PAGCOR are naturally engaged in business in the
Philippines.
I join Justice Amy C. Lazaro-Javier in concluding that
offshore-based POGO licensees are doing business in
the Philippines, and adopt the findings in a Security and
Exchange Commission Opinion with similar facts:
SCEH averred that it was not doing business in the
Philippines since the activities of SCEH were carried
outside of the Philippines, its employees were in Hong
Kong, its property was outside the Philippines, and that
the SEN servers were located in the United States
(U.S.). Offshore-based POGO licensees raised the same
arguments save for the fact that they conducted their
offshore gaming operations through the services of
PAGCOR-accredited local gaming agents and service
providers for its gaming operations.
12
Here, I respectfully submit that the services of
offshore-based POGO [licensees] "offering by a licensee
of PAGCOR authorized online games of chance via the
Internet using a network and software or program,
exclusively to offshore authorized players excluding
Filipinos abroad, who have registered and established
an online gaming account with the licensee"- are being
rendered here. These enumerated activities are
transactions deemed to have been consummated within
the Philippines, albeit done on the virtual plane. From
placing the bet to winning a bet, the commercial
transaction, e-commerce or any sort of virtual
transactions find themselves within the Philippines
through the services of PAGCOR-accredited local
gaming agents and service providers for its offshore
gaming operations.[14] (Emphasis in the original)
The transnational nature of POGOs blur borderlines and
facilitate the possibility of non-taxation in any of the
jurisdictions where they operate. The revenue from
gambling operations may not be worth the kind of values
they instill, the politics they infect, the health they risk,
and the lives they destroy. Thus, allowing gambling
operations and issuing licenses for them entail the
corresponding duty to strictly regulate them, and
efficiently collect their enforced contributions.

Despite the averments of SCEH, the SEC still opined
that the activities SCEH proposed to undertake would
deem it as "doing business" in the Philippines since the
twin characterization test was satisfied. First, the
enumerated activities to be undertaken by SCEH
indicated that it would be continuing in the Philippines
the substance of the business for which it was
organized. Second, the SCEH enumerated activities
which were considered consummated within the
Philippines, albeit done in a virtual plane. I see no
reason not to apply the same ruling to offshore-based
POGO licensees whose footprints are all over the
Philippines; they entered into contracts with
PAGCOR-accredited local gaming agents and service
providers in furtherance of their main line of business,
i.e. gaming operations.
Bayanihan 2 was an urgent piece of legislation passed
by Congress and signed by the President.[15] The statute
and the revenue regulations were acts of the legislature
and the concerned administrative agency that has
expertise over the matter. These bodies are presumed to
have acted meticulously, aware of their constitutional
and statutory bounds. Absent any showing of grave
abuse of discretion, judicial restraint must be exercised
in reviewing the technical details of their issuances.
ACCORDINGLY, I vote to DENY the consolidated
Petitions

Verily, the gaming operations conducted by

offshore-based POGO licensees within the Philippines
through the services of PAGCOR-accredited local
gaming agents and service providers for its offshore
gaming operations implies the continuity of commercial
dealings and arrangements, and contemplates the
performance of acts incident to, and in the progressive
prosecution of their business. These services will not be
provided intermittently but for a long period of time in the
Philippines. Accordingly, petitioners are considered
resident foreign corporations doing business in the
Philippines.[13] (Emphasis in the original)
I likewise agree that petitioners' activities are
consummated here which subject them to government
regulations—among which is taxation:
For the source of income to be considered as coming
from the Philippines, it is sufficient that the income is
derived from activity within the Philippines, e.g., sale of
tickets in the Philippines is the activity that produces the
income as the tickets exchanged hands here and
payments for fares were also made here in Philippine
currency. The situs of the source of payments is the
Philippines. The flow of wealth proceeded from, and
occurred within, Philippine territory, enjoying the
protection accorded by the Philippine government. In
consideration of such protection, the flow of wealth
should share the burden of supporting the government.
 13

Tolentino v. Secretary of Finance, G.R. No. 115455

The case involves motions seeking reconsideration of

the Court's decision dismissing the petitions for the
declaration of unconstitutionality of R.A. No. 7716,
(Expanded Value-Added Tax Law). The motions, of
which there are 10 in all, have been filed by the several
petitioners. The Philippine Press Institute, Inc. (PPl)
contends that by removing the exemption of the press
from the VAT while maintaining those granted to others,
the law discriminates against the press.

They claim that, "even nondiscriminatory taxation of

constitutionally guaranteed freedom is unconstitutional"
citing in support of the case of Murdock v. Pennsylvania
(License Tax).

Chamber of Real Estate and Builders Associations, Inc.,

(CREBA), on the other hand, asserts that R.A. No. 7716
(1) impairs the obligations of contracts,
(2) Classifies transactions as covered or exempt without
reasonable basis and
(3) Violates the rule that taxes should be uniform and
equitable and that Congress shall "evolve a progressive
system of taxation" The Cooperative Union of the
Philippines (CUP), argues that legislature was to adopt a
definite policy of granting tax exemption to cooperatives
that the present Constitution embodies provisions on
cooperatives. To subject cooperatives to the VAT would,
therefore, be to infringe a constitutional policy.

One contention is that A 7716 did not originate

exclusively in the House of Representatives as required
by Art. VI, Sec. 24 of the Constitution, because it is in
fact the result of the consolidation of 2 distinct bills, H.
No. 11197 and S. No. 1630. There is also a contention
that S. No. 1630 did not pass 3 readings as required by
the Constitution.

ISSUE:
● WON based on the grounds of the petitioners,
the Expanded Value-Added Tax Law should be
declared unconstitutional? NO
● WON RA 7716 violates Art. VI, Secs. 24 and
26(2) of the Constitution? NO

HELD: NO, NO
Anent PPl's contention, since the law granted the press
a privilege, the law could take back the privilege anytime
without offense to the Constitution. The reason is simple:
by granting exemptions, the State does not forever
waive the exercise of its sovereign prerogative. Indeed,
in withdrawing the exemption, the law merely subjects
the press to the same tax burden to which other
businesses have long ago been subject. The PPI asserts
that it does not really matter that the law does not
discriminate against the press because "even
nondiscriminatory taxation on constitutionally guaranteed
freedom is unconstitutional." The Court was speaking in
that case (Murdock v. Pennsylvania) of a license tax,
which, unlike an ordinary tax, is mainly for regulation. Its
imposition on the press is unconstitutional because it
lays a prior restraint on the exercise of its right.

The VAT is, however, different. It is not a license tax. It is

not a tax on the exercise of a privilege, much less a
constitutional right. It is imposed on the sale, barter,
lease or exchange of goods or properties or the sale or
exchange of services and the lease of properties purely
for revenue purposes. To subject the press to its
payment is not to burden the exercise of its right any

more than to make the press pay income tax or subject it
to general regulation is not to violate its freedom under
the Constitution.
Anent the first contention of CREBA, it has been held in
an early case that even though such taxation may affect
particular contracts, as it may increase the debt of one
person and lessen the security of another, or may
impose additional burdens upon one class and release
the burdens of another, still the tax must be paid unless
prohibited by the Constitution, nor can it be said that it
impairs the obligation of any existing contract in its true
legal sense.
It is next pointed out that while Section 4 of R.A. No.
7716 exempts such transactions as the sale of
agricultural products, food items, petroleum, and medical
and veterinary services; it grants no exemption on the
sale of real property which is equally essential. The sale
of food items, petroleum, medical and veterinary
services, etc., which are essential goods and services
that were already exempt under Section 103, pars. (b)
(d) (1) of the NIRC before the enactment of R.A. No.
7716. Petitioner is wrong in claiming that R.A. No. 7716
granted exemption to these transactions while subjecting
those of petitioner to the payment of the VAT.
Finally, it is contended that R.A. No. 7716 also violates
Art. VI, Section 28(1) which provides that "The rule of
taxation shall be uniform and equitable. The Congress
shall evolve a progressive system of taxation".
Nevertheless, equality and uniformity of taxation mean
that all taxable articles or kinds of property of the same
class be taxed at the same rate. The taxing power has
the authority to make reasonable and natural
classifications for purposes of taxation. To satisfy this
requirement it is enough that the statute or ordinance
applies equally to all persons, firms, and corporations
placed in similar situations.
The next argument of the petitioners was that S. No.
1630 did not pass 3 readings on separate days as
required by the Constitution because the second and
third readings were done on the same day. But this was
because the President had certified S. No. 1630 as
urgent. The presidential certification dispensed with the
requirement not only of printing but also that of reading
the bill on separate days. That upon the certification of a
bill by the President the requirement of 3 readings on
separate days and of printing and distribution can be
dispensed with is supported by the weight of legislative
practice.
With all the foregoing ratios, it is clear that the subject
law bears no constitutional infirmities and is thus
constitutional.
Macias v. COMELEC (G.R. No. L-18684)
Citizens who are deprived of an election franchise to
which they are entitled under the Constitution by an
apportionment act, have sufficient interest to test its
validity. Apportionment of legislative districts may legally
rest on official census enumeration even if not yet final.
Republic Act No. 3040 that gives provinces with less
number of inhabitants more representative districts than
those with bigger population is declared invalid because
it violates the principle of proportional representation
prescribed by the Constitution.
14
FACTS:
Petitioners request that respondent officials be
presented from implementing Republic Act 3040 that
apportions representative districts. They alleged that
said RA unconstitutional and void because: (a) it was
passed by the House of Representatives without printed
final copies of the bill having been furnished the
Members at least three calendar days prior to its
passage; (b) it was approved more than three years after
the return of the last census of our population; and (c) it
apportioned districts without regard to the number of
inhabitants of the several provinces.
The respondents aver they were merely complying with
their duties under the statute, which they presume and
allege to be constitutional. Respondent National
Treasurer further avers that petitioners have no
personality to bring this action; that a duly certified copy
of the law creates the presumption of its having been
passed in accordance with the requirements of the
Constitution (distribution of printed bills included); that
the Director of the Census submitted an official report on
the population of the Philippines in November 1960,
which report became the basis of the bill; and that the
Act complies with the principle of proportional
representation prescribed by the Constitution.
ISSUES:
WON RA 3040 violates the principle of proportional
representation stipulated in the Constitution.
HELD:
Republic Act No. 3040 that gave provinces with less
number of inhabitants more representative districts than
those with bigger population is declared invalid because
it violates the principle of proportional representation
prescribed by the Constitution.
The Constitution directs that the one hundred twenty
Members of the House of Representatives “shall be
apportioned among the several provinces as nearly as
may be according to the number of their respective
inhabitants.” After hearing the parties and considering
their memoranda, The Court issued a resolution, stating
that RA 3040 violates the Constitution in several ways
namely: (a) it gave Cebu seven members, while Rizal
with a bigger number of inhabitants got four only; (b) it
gave Manila four members, while Cotabato with a bigger
population got three only; . . .” “The constitutionality of a
statute forming a delegate district or apportioning
delegates for the house of delegates is a judicial
question for the courts, although the statute is an
exercise of political power.”
Gonzales v. Macaraig (G.R. No. 87636)
November 19, 1990 | 191 SCRA 133
FACTS:
President Corazon Aquino vetoed Section 55 of the GAA
for the fiscal year 1989 and Section 16 of the GAA for
the fiscal year 1990. The reason cited by President
Aquino was that both of these sections restrict or prevent
the President, the Senate President, the Speaker of the
House, the heads of the constitutional commisions and
the Chief Justice of the SC from restoring or increasing
items of appropriation recommended by the President,
which recommendations have already been reduced or
disapproved by Congress through the assailed GAAs. In
effect, these sections nullify the statutory and
 15
constitutional authority of the aforesaid officials to
augment any item in the GAA for their respective offices
from savings in other items of their appropriation.

ISSUE:
Whether or not the presidential veto on Section 55 of the
GAA for the fiscal year 1989 and Section 16 of the GAA
for the fiscal year 1990 is constitutional.

HELD:
Yes, the presidential veto on Section 55 of GAA for the
fiscal year 1989 and Section 16 of the GAA for the fiscal
year 1990 is constitutional. These sections were vetoed
because they violate Section 5(5) of Art. VI of the 1987
Constitution, which grants the President, the President of
the Senate, the Speaker of the House, the heads of the
Constitutional Commissions, and the CJ of the SC the
authority to augment any item in the general
appropriations law for their respective offices from
savings in other items of their appropriations.