CALTEX (Philippines), INC. v.

PALOMAR
G.R. No. L-1965
29 September 1966
Castro J.

FACTS
Caltex (Philippines), Inc., has come up with a contest called “Caltex Hooded Pump,” wherein
participants are to estimate or guess the actual number of liters a hood gas pump at each Caltex
station will dispense during a specific period. Contest is open for everyone except for Caltex’s dealers,
advertising agency, employees and their immediate families. No participation fee is required nor a
need to purchase company’s products. Participants will simply secure and accomplish entry forms
which are available upon request at each Caltex station and submit them as their entry stubs. As the
use of mails will be extensively used, mainly for easier transmission of communications and publicize
the contest nationwide, Caltex has cleared in advance with the postal authorities, through a
representative, that the contest does not violate the anti-lottery provisions of the Postal law.
However, Postmaster General declined to grant the requested clearance. Caltex sought a
reconsideration and even enclosed a copy of the contest rules to prove no violation will be made to
the anti-lottery provisons of the Postal Law. Nonetheless, Postmaster General maintained his stand
against the proposed contest and threatened to issue fraud order against Caltex and all its
representatives should they conduct the contest. Therefore, Caltex has invoked for judicial
intervention and filed a petition for declaratory relief against Postmaster General Enrico Palomoar.

ISSUE
1. Whether the petition states a sufficient cause of action for declaratory relief.
2. Whether the proposed “Caltext Hoode Pump Contest” violates the Postal Law

RULING
1. Yes. As per Section 1 of Rule 66 of the Old Rules of Court, which was the applicable legal basis for
the remedy at the time it was invoked, declaratory relief is available to any person “whose rights are
affected by a statute . . . to determine any question of construction or validity rising under the . . .
statute and for a declaration of his rights thereunder” (now Section 1 Rule 64, Revised Rules of Court).
Furthermore, the Court has laid down certain conditions sine qua non therefor, to wit: (1) there must
be a justiciable controversy; (2) the controversy must be between persons whose interests are
adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy; and (4)
the issue involved must be ripe for judicial determination. The appellee, Caltex and appellant,
Postmaster General Palomar, have such adverse judgments on the contest in question and its
violations against Postal Law, calling for an inquiry on the legislation which is the act of construction.
Caltex, a business enterprise, has the right to exploit every legitimate means to increase the
patronage of the products and avail