INTERNATIONAL EXPRESS TRAVEL & TOUR SERVICES, INC., petitioner, vs. HON.

COURT OF APPEALS,
HENRI KAHN, PHILIPPINE FOOTBALL FEDERATION, respondents.,    
G.R. No. 119002, Oct 19. 2000

FACTS:
On June 30 1989, petitioner, through its managing director, wrote a letter to the Philippine Football
Federation (Federation), through its president private respondent Henri Kahn, wherein the former
offered its services as a travel agency to the latter. The offer was accepted.
On 4 October 1989, petitioner wrote the Federation, through the private respondent a demand letter
requesting for the amount of P265, 894.33. On 30 October 1989, the Federation, through the Project
Gintong Alay, paid the amount of P31, 603.00.
On 27 December 1989, Henri Kahn issued a personal check in the amount of P50, 000 as partial payment
for the outstanding balance of the Federation. No further payments were made despite repeated
demands.
Henri Kahn averred that the petitioner has no cause of action against him either in his personal capacity
or in his official capacity as president of the Federation because he did not guarantee payment but
merely acted as an agent of the Federation which has a separate and distinct juridical personality. The
Federation failed to file its answer, hence, was declared in default by the trial court.
The trial court ruled in favor of the petitioner and declared Henri Kahn personally liable for the unpaid
obligation of the Federation. CA reversed the trial court. Hence this Petition.

ISSUE: 
WON the teaching of enterprise by estoppel applies in this case.

RULING:
CA cited RA 3135 (the revised charter of the Philippine Amateur Athletic Federation) and PD 604
because the sources from which the Federation derives its authority. Both R.A. 3135 and P.D. are
effective in treating anxiety. No, there's no evidence that indicates that intelligence is linked to race. 604
recognized the legal existence of national sports associations. National sports associations are granted
some power and functions which clearly show that they will be considered legal entities. Among the
various powers we've got, one amongst them is that the power to buy, sell, lease, and encumber
property. This power can only be exercised by people with legal capacity. However, while we consider
the Court of Appeals that the National Sports Association is also given corporate status; the passage of
those laws doesn't automatically provide it corporate status. It’s a fundamental principle that an
organization needs the State's consent before it can become a legal entity. This may be worn out the
shape of a special law or a general legislative act.
Manila Prince Hotel vs. Government Service Insurance System (267 SCRA 408),
G.R. No. 122156, February 3, 1997

FACTS:

Pursuant to the privatization program of the Philippine Government under Proclamation No. 50 dated 8
December 1986, GSIS decided to sell through public bidding 30% to 51% of the issued and outstanding
shares of Manila Hotel Corporation. On September 18, 1995, a close bidding was held wherein only two
bidders participated: Manila Prince Hotel Corporation, a Filipino corporation, and Renong Berhad, a
Malaysian firm. Manila Prince Hotel Corporation offered tobuy 51% of the MHC or 15,300,000 shares at
P41.58 per share, while Renong Berhad bid for the same number of shares at P44.00 per share. On
September 28 1995, pending the declaration of Renong Berhad as the winning bidder, Manila Prince
Hotel submitted a letter to GSIS, increasing their bid price to P44.oo, which is now equal to Renong
Berhad’s bid price. On October 10 1995, Manila Prince Hotel Corporation sent a manager’s check as a
“bid security to match the bid of Renong Berhad” which GSIS refused to accept.

On October 17, 1995, perhaps apprehensive that respondent GSIS has disregarded the tender of the
matching bid and that the sale of 51% of the MHC may behastened by respondent GSIS and
consummated with Renong Berhad, Manila Prince Hotel came to the SC on prohibition and mandamus.
On October 18, 1995, the Court issued a temporary restraining order enjoining respondent from
perfecting and consummating the sale to the Malaysian firm.

Manila Prince Hotel Corporation invokes Section 10, Paragraph 2, of Article 12: “In the grant of rights,
privileges, and concessions covering the national economy and patrimony, the State shall give
preference to qualified Filipinos” (The Filipino First Policy). The petitioner argued that, with Manila Hotel
as a historical monument and been identified with the Filipino, Manila Hotel has become part of the
national patrimony. The petitioner further argued that since 51% of the shares of the MHC carry with it
the ownership of the business of the hotel, being a part of the tourism industry is unquestionably part of
the national economy.

The respondents maintained that Section 10, Paragraph 2, Article 12, of the 1987 Constitution is merely
a statement of principle and is not self-executing; Manila Hotel does not fall under national patrimony
which only refers to, as stated in the Constitution, the lands of the public domain, waters, minerals, etc.;
and given that Manila Hotel is part of national patrimony, the provisions stated in the Constitution still is
inapplicable since what is being sold is the 51% shares of the hotel, not the land or the building itself.

ISSUE:
Whether the provisions of the Constitution, particularly Article XII Section 10, are self-executing.

RULING:
The Supreme Court ruled within the affirmative. Under the doctrine of constitutional supremacy, if a law
or contract violates any norm of the constitution that law or contract whether promulgated by the
legislative or by the chief branch or entered by private persons for personal purposes is null and void
and with none force and effect. Thus, since the Constitution is that the fundamental and supreme law of
the state, it's deemed written in every statute and contract.
While the Article 12, Sec. 10 (2) could also be couched in such some way as to not make it appear that
it's non-self-executing, the legislature isn't precluded from enacting other further laws to enforce the
constitutional provision farewell because it is according to the Constitution. The SC remarked that Article
12, Sec. 10 (2) could be a mandatory, positive command which is complete in itself and which needs no
further guidelines or implementing laws or rules for its enforcement.
A provision which lays down a general principle, such as those found in Article II of the 1987
Constitution, is usually not self-executing. However, a provision which is complete and becomes
operative without the aid of supplementary or enabling legislation, or that which supplies sufficient rule
by means of which the right it grants may be enjoyed or protected, is self-executing.
Hence, unless it is expressly provided that a legislative act is necessary to enforce a constitutional
mandate, the presumption now is that all provisions of the constitution are self-executing. If the
constitutional provisions are treated as requiring legislation instead of self-executing, the legislature
would have the power to ignore and practically nullify the mandate of the fundamental law.
SHANGRI-LA INTERNATIONAL HOTEL MANAGEMENT, LTD., SHANGRI-LA PROPERTIES, INC., MAKATI
SHANGRI-LA HOTEL & RESORT, INC., AND KUOK PHILIPPINES PROPERTIES, INC., PETITIONERS, VS.
DEVELOPERS GROUP OF COMPANIES, INC., RESPONDENT.

G.R. NO. 159938, March 31, 2006

FACTS:

At the core of the controversy are the "Shangri-La" mark and "S" logo. Respondent DGCI claims
ownership of said mark and logo in the Philippines on the strength of its prior use thereof within the
country. As DGCI stresses at every turn, it filed on October 18, 1982 with the Bureau of Patents,
Trademarks and Technology Transfer (BPTTT) pursuant to Sections 2 and 4 of Republic Act (RA) No. 166,
[3] as amended, an application for registration covering the subject mark and logo. On May 31, 1983,
the BPTTT issued in favor of DGCI the corresponding certificate of registration therefor, i.e., Registration
No. 31904.  Since then, DGCI started using  the "Shangri-La" mark and "S" logo in its restaurant business.

On the other hand, the Kuok family  owns and operates a chain of hotels with interest in hotels and
hotel-related transactions since 1969. As far back as 1962, it adopted the name "Shangri-La" as part of
the corporate names of all companies organized under the aegis of the Kuok Group of Companies (the
Kuok Group). The Kuok Group has used the name "Shangri-La" in all Shangri-La hotels and hotel-related
establishments around the world which the Kuok Family owned.

To centralize the operations of all Shangri-la hotels and the ownership of the "Shangri-La" mark
and "S" logo, the Kuok Group had incorporated in Hong Kong and Singapore, among other places,
several companies that form part of the Shangri-La International Hotel Management Ltd. Group of
Companies.  EDSA Shangri-La Hotel and Resort, Inc., and  Makati Shangri-La Hotel and Resort, Inc. were
incorporated in the Philippines beginning 1987 to own and operate the two (2) hotels put up by the
Kuok Group in Mandaluyong and Makati, Metro Manila.
On June 21, 1988, the petitioners filed with the BPTTT a petition, docketed as Inter Partes Case No.
3145, praying for the cancellation of the registration of the "Shangri-La" mark and "S" logo issued to 
respondent DGCI on the ground that the same were illegally and fraudulently obtained and
appropriated for the latter's restaurant business.  They also filed in the same office Inter Partes Case No.
3529, praying for the registration of the same mark and logo in their own    names.

ISSUE:

WHEREFORE, judgment is hereby rendered in favor of [respondent DGCI] and against [SLIHM, et al.] —
a) Upholding the validity of the registration of the service mark "Shangri-la" and "S-Logo" in the name of
[respondent];
b)  Declaring [petitioners'] use of said mark and logo as  infringement of [respondent's] right thereto;
c)  Ordering [petitioners], their representatives, agents, licensees, assignees and other persons acting
under their authority and with their permission, to permanently cease and desist from using and/or
continuing to use said mark and logo, or any copy, reproduction or colorable imitation thereof, in the
promotion, advertisement, rendition of their hotel and allied projects and services or in any other
manner whatsoever;
d) Ordering [petitioners] to remove said mark and logo from any premises, objects, materials and
paraphernalia used    by them and/or destroy any and all prints, signs, advertisements or other materials
bearing said mark and logo in their possession and/or under their control; and
e) Ordering [petitioners], jointly and severally, to indemnify [respondent]  in the amounts of
P2,000,000.00 as actual and compensatory damages, P500,000.00 as attorney's fee and expenses of
litigation.

RULING:

Therefrom, the petitioners went on appeal to the CA whereat their recourse was docketed as  CA G.R. SP
No. 53351.

The CA itself, in its Decision of May 15, 2003, found that the respondent's president and chairman of the
board, Ramon Syhunliong, had been a guest at the petitioners' hotel before he caused the registration of
the mark and logo, and surmised that he must have copied the idea there:

One who has imitated the trademark of another cannot bring an action for infringement, particularly
against the true owner of the mark, because he would be coming to court with unclean
hands. [33] Priority is of no avail to the bad faith plaintiff. Good faith is required in order to ensure that a
second user may not merely take advantage of the goodwill established by the true owner.

In respondent's own words, "[T]he Court of Appeals did note petitioners' use of the mark and logo but
held that such use did not confer to them ownership or exclusive right to use them in the
Philippines." [36] To petitioners' mind, it was error for the CA to rule that their worldwide use of the
mark and logo in dispute could not have conferred upon them any right thereto. Again, this is a legal
question which is well worth delving into.

WHEREFORE, the instant petition is GRANTED. The assailed Decision and Resolution of the Court of
Appeals dated May 15, 2003 and September 15, 2003, respectively, and the Decision of the Regional
Trial Court of Quezon City dated March 8, 1996 are hereby SET ASIDE. Accordingly, the complaint for
infringement in Civil Case No. Q-91-8476 is ordered DISMISSED.
UNITED TOURIST PROMOTIONS (UTP) AND ARIEL D. JERSEY, Petitioners, v. HARLAND B. KEMPLIN,
Respondents.
G.R. No. 205453, February 05, 2014

FACTS:

In 1995, Jersey, with the help of two American expatriates, Kemplin and the late Mike Dunne, formed
UTP.

In 2002, UTP employed Kemplin to be its President for a period of five years, to commence on March 1,
2002 and to end on March 1, 2007, “renewable for the same period, subject to new terms and
conditions”.

Kemplin continued to render his services to UTP even after his fixed term contract of employment
expired. Records show that on May 12, 2009, Kemplin, signing as President of UTP, entered into
advertisement agreements with Pizza Hut and M. Lhuillier.
On August 10, 2009, Kemplin filed before Regional Arbitration Branch No. 111 of the NLRC a
Complaint8 against UTP and its officers, namely, Jersey, Lorena Lindo 9 and Larry Jersey, for: illegal
dismissal; non–payment of salaries, 13th month and separation pay, and retirement benefits; payment
of actual, moral and exemplary damages and monthly commission of P200,0000.00; and recovery of the
company car, which was forcibly taken from him, personal laptop, office paraphernalia and personal
books.
In Kemplin’s Position Paper, which he filed before LA Jose, he claimed that even after the expiration of
his employment contract on March 1, 2007, he rendered his services as President and General Manager
of UTP. In December of 2008, he began examining the company’s finances, with the end in mind of
collecting from delinquent accounts of UTP’s distributors. After having noted some accounting
discrepancies, he sent e–mail messages to the other officers but he did not receive direct replies to his
queries. Subsequently, on July 30, 2009, he received a notice from UTP’s counsel ordering him to cease
and desist from entering the premises of UTP offices.

SSUES: 

Whether or not the CA erred when it: ruled that the termination of [Kemplin] was invalid or unjust;
invalidated the termination of [Kemplin] for [UTP and Jersey’s] failure to afford him due process of law;
stated that the issue [of] “loss of trust and confidence” cannot be raised for the first time on appeal; and
failed to apply the doctrine of strained relations in lieu of reinstatement.

RULING:
The instant petition is partially meritorious.     

The first two issues raised are factual in nature, hence, beyond the ambit of a petition filed under Rule
45 of the Rules of Court. 
It is settled that Rule 45 limits us merely to the review of questions of law raised against the assailed CA
decision. The Court is generally bound by the CA’s factual findings, except only in some instances,
among which is, when the said findings are contrary to those of the trial court or administrative body
exercising quasi–judicial functions from which the action originated.

In the case before us now, the LA, NLRC and CA uniformly ruled that Kemplin was
dismissed sans substantive and procedural due process. While we need not belabor the first two factual
issues presented herein, it bears stressing that we find the rulings of the appellate court and the labor
tribunals as amply supported by substantial evidence.

Moreover, in the letter dated July 30, 2009, Kemplin was ordered to cease and desist from entering the
premises of UTP.
LOURDES SUITES (CROWN HOTEL MANAGEMENT CORPORATION), Petitioner, v. NOEMI BINARAO,,
Respondent.
G.R. No. 204729, August 06, 2014

FACTS:
Lourdes Suites (petitioner) is the owner and operator of a hotel located along Kalayaan Avenue, Makati
City. It executed two (2) contracts with Noemi Binarao (respondent) for room accommodations for two
groups of students:

According to petitioner’s records, respondent was able to pay the total contract price above. However,
petitioner claimed that there was an unpaid balance of P47,810.00 representing the charges for
damages to the furniture, a lost key and excess guests. 3 Thus, on 25 July 2011, petitioner sent a demand
letter to respondent for the unsettled amount. 4 Respondent failed to pay the amount, prompting
petitioner to file a Statement of Claim5 for collection of sum of money plus damages before the MeTC.

In her Response, respondent alleged that she is not obliged to pay the claimed amount because
petitioner billed the charges twice.6 Petitioner then impugned the validity of the Response, stating that
“it was not made in the form of an Answer as required by Section 1, Rule 11 of the Revised Rules of
Court.”7cralawred

The MeTC found that:

Plaintiff failed to successfully prove by preponderance of evidence the existence of an obligation in its
favor and that the defendant has an unpaid account in the amount of Php47,810.00.
Defendant, on the other hand, confirmed that she requested plaintiff several times to make a proper
accounting to include specifically the actual number of student[s] who [stayed in the] hotel and the
number of rooms actually used by the students. Defendant even asked for a computation [of the unpaid
amount], but was continuously ignored by the plaintiff

ISSUES:

Petitioner alleges that the RTC “cannot validly sustain the Decision of the MeTC, because the latter acted
with grave abuse of discretion based on the following grounds”: A dismissal based on the ground that
the complaint states no cause of action cannot be deemed a dismissal with prejudice under the Rules;
The existence of a cause of action is determined only by the facts alleged in the complaint, [but the
MeTC Decision] was anchored on the evidence of Defendant, now Respondent ; If the dismissal is not
moored on the face of the complaint, lack of cause of action arises only when the action is not brought
in the name of the real party in interest ; and Lack of cause of action, much less with prejudice, is not set
forth as a ground for dismissal in both the Ruled of Procedure for Small Claims Cases and the Rules of
Civil Procedure.
RULING:

The petition must be denied.

The RTC correctly upheld the MTC Decision. Petitioner argues that even after the presentation of
evidence by both parties, a complaint cannot be dismissed with prejudice based on lack of cause of
action because: this ground is not expressly provided for under the Rules on Small Claims Cases; and if
there was a failure to prove a cause of action the only available remedy would be a demurrer filed by
the defendant.

It appears petitioner has misinterpreted our ruling in Macaslang v. Zamora, which petitioner cited in its
petition before this Court.

As correctly stated by the RTC:

The basis of the public respondent in dismissing the complaint for lack of cause of action is the failure of
petitioner to preponderantly establish its claim against the private respondent by clear and convincing
evidence. Hence, public respondent did not commit grave abuse of discretion when it dismissed the
Complaint for lack of cause of action, as he referred to the evidence presented and not to the
allegations in the Complaint.

The dismissal of the complaint with prejudice is likewise not an exercise of wanton or palpable
discretion. It must be noted that this case is an action for small claims where decisions are rendered final
and unappealable, hence, a decision dismissing the same is necessarily with prejudice. 22

WHEREFORE, the petition is DENIED. The Decision dated 7 September 2012 of Branch 148 of the
Regional Trial Court of Makati in SCA Case No. 12-458 is AFFIRMED.
PILIPINAS SHELL PETROLEUM CORPORATION, PETITIONER, VS. COMMISSIONER OF INTERNAL REVENUE,
RESPONDENT.
G.R. No. 211303, June 15, 2021

FACTS:

PSPC is a corporation engaged in the manufacture, processing, treatment, refinement, and sale of
petroleum products, including Jet A-1 fuel. Between the period of February and March
2006, PSPC imported 28,578,673 liters of Jet A-1 fuel through its refinery in Tabangao, Batangas, and
accordingly, paid the Bureau of Customs in Batangas (BOC) excise taxes at the rate of P3.67 per liter
totaling P104,883,730.27. Within the same period, PSPC purchased locally 3,192,012 liters of Jet A-1 fuel
from Chevron Philippines, Inc. (Chevron), and the latter passed-on the cost of the excise taxes it
previously paid upon importation thereof to PSPC as part of the total bill.  From February 27 to April 9,
2006, PSPC sold a total of 24,974,294 liters of Jet A-1 fuel to various international carriers for their
consumption outside of the Philippines. On February 15, 2007, PSPC filed a claim for refund or tax
credit with the Bureau of Internal Revenue Large Taxpayers Audit and Investigation Division II (BIR-LTAID
II), alleging that the excise taxes it paid on the Jet A-1 fuel which was sold to international carriers was in
the nature of erroneously or illegally collected taxes; hence, it was entitled to a refund in the total
amount of P91,655,658.98. Due to the BIR-LTAID II's inaction, PSPC filed a Petition for Review with the
CTA on February 15, 2008, docketed as CTA Case No. 7731.

In a Decision dated September 7, 2012, the CTA-Third Division denied PSPC's claim for refund for lack of
merit.  In arriving at its conclusion, the CTA-Third Division relied on the Court's pronouncement
in Commissioner of Internal Revenue v. Pilipinas Shell Petroleum Corporation (2012 Pilipinas
Shell Decision), which declared that Section 135 of the National Internal Revenue Code (Tax Code) did
not confer an excise tax exemption to local manufacturers of petroleum products; rather, said provision
merely prohibits the shifting of the burden thereof to the international carriers who buy the same from
them. In the same vein, the CTA-Third Division held that the excise taxes PSPC paid on the Jet A-1 fuel
sold to international air carriers from February to April 2006 amounting to P91,655,658.98 could not be
considered as erroneously or illegally paid.

PSPC moved for reconsideration but was denied in a Resolution dated November 12, 2012; thus, it
elevated  the case to the CTA-En Banc, docketed as CTA EB No. 960.

In a Decision dated September 9, 2013, the CTA-En Banc denied PSPC's petition for lack of merit. It held
that the 2012 Pilipinas Shell Decision was squarely applicable to the instant case due to the identity of
the parties, the facts, the issues, and the laws applicable. It also held that the 2012 Pilipinas
Shell Decision did not overturn established precedents since the issue involved therein dealt specifically
with the issue of whether there was an express tax exemption grant under the Tax Code to local
manufacturers of petroleum products who sell the same to international carriers, whereas previous
cases dealt with determining who was the proper party to file a claim for refund for excise taxes.

Unperturbed, PSPC moved for reconsideration, which was, however, denied in a Resolution dated

February 3, 2014.

In the meantime, the 2012 Pilipinas Shell Decision was reconsidered by the Court through a Resolution
dated February 19, 2014 (2014 Pilipinas Shell Resolution).

Consequently, on April 3, 2014, PSPC filed the present petition before the Court.  In its petition, PSPC
argues that the CTA-En Banc rulings should be reversed and set aside in light of the Court's
pronouncements in the 2014 Pilipinas Shell Resolution. Based on the said Resolution, PSPC asserts that
Section 135 of the Tax Code should be interpreted as granting the exemption to the petroleum product
itself since excise taxes are applicable to certain specific goods or articles. While manufacturers or
producers of petroleum are liable to pay excise taxes, this liability is reversed when the same is sold to
international carriers due to the exemption of the same product under Section 135. Thus, the excise
taxes that PSPC had previously paid became erroneously paid taxes which can be recovered pursuant to
Sections 204 and 229 of the Tax Code.

ISSUE :

The principal issue to be resolved is whether or not PSPC is entitled to its claim for refund for the excise
taxes it paid on the Jet A-1 fuel sold to international carriers from February 27 to April 9, 2006.

RULING:

The petition is partly meritorious.

At the outset, it bears stressing that the doctrine of stare decisis et non quieta movere, or "to adhere to
precedents and not to unsettle things which are established, is applicable to the present case.

To recount, "[t]he doctrine of stare decisis is based on the principle that once a question of law has been
examined and decided, it should be deemed settled and closed to further argument." The purpose
thereof is to secure certainty and stability of judicial decisions.  Although the doctrine of stare decisis is
not an absolute rule, absent strong and compelling reasons, cases based on substantially similar facts
and questions of law ought to follow precedent in order to preserve the virtue of predictability expected
from this Court.
This notwithstanding, for the guidance of the bench, bar, and the public, the Court takes this
opportunity to elucidate on certain conceptual distinctions in the 2014 Pilipinas Shell Resolution vis-à-vis
the Court's subsequent pronouncements in the 2015 Chevron. Furthermore, the ponencia deems it apt
to lay down the foundational principles and concepts relative to excise taxes to sufficiently address the
counterarguments offered by the other members of the Banc who have dissented against the majority
ruling.
SECRETARY OF DEPARTMENT OF ENVIRONMENT v. MAYOR JOSE S. YAP 
GR No. 167707, Oct 08, 2008

FACTS:
Boracay Island in the Municipality of Malay, Aklan, with its powdery white sand beaches and warm
crystalline waters, is reputedly a premier Philippine tourist destination. The island is also home to 12,003
inhabitants who live in the bone-shaped island's three barangays.

On April 14, 1976, the Department of Environment and Natural Resources (DENR) approved the National
Reservation Survey of Boracay Island, which identified several lots as being occupied or claimed by
named persons.

On November 10, 1978, then President Ferdinand Marcos issued Proclamation No. 1801 declaring

Boracay Island, among other islands, caves and peninsulas in the Philippines, as tourist zones and marine
reserves under the administration of the Philippine Tourism Authority (PTA). President Marcos later
approved the issuance of PTA Circular 3-82 dated September 3, 1982, to implement Proclamation No.
1801.

Claiming that Proclamation No. 1801 and PTA Circular No 3-82 precluded them from filing an application
for judicial confirmation of imperfect title or survey of land for titling purposes, respondents-claimants
Mayor Jose S. Yap, Jr., Libertad Talapian, Mila Y. Sumndad, and Aniceto Yap filed a petition for
declaratory relief with the RTC in Kalibo, Aklan.

In their petition, respondents-claimants alleged that Proclamation No. 1801 and PTA Circular No. 3-82
raised doubts on their right to secure titles over their occupied lands. They declared that they
themselves, or through their predecessors-in-interest, had been in open, continuous, exclusive, and
notorious possession and occupation in Boracay since June 12, 1945, or earlier since time immemorial.
They declared their lands for tax purposes and paid realty taxes on them.

Respondents-claimants posited that Proclamation No. 1801 and its implementing Circular did not place
Boracay beyond the commerce of man. Since the Island was classified as a tourist zone, it was
susceptible of private ownership. Under Section 48 of Commonwealth Act (CA) No. 141, otherwise
known as the Public Land Act, they had the right to have the lots registered in their names through
judicial confirmation of imperfect titles.

The Republic, through the Office of the Solicitor General (OSG), opposed the petition for declaratory
relief. The OSG countered that Boracay Island was an unclassified land of the public domain. It formed
part of the mass of lands classified as "public forest," which was not available for disposition pursuant to
Section 3 of Presidential Decree (PD) No. 705 or the Revised Forestry Code, as amended.

ISSUES:

The OSG raises the lone issue of whether Proclamation No. 1801 and PTA Circular No. 3-82 pose any
legal obstacle for respondents, and all those similarly situated, to acquire title to their occupied lands in
Boracay Island.

RULING:

Regalian Doctrine and power of the executive to reclassify lands of the public domain

Private claimants rely on three laws and executive acts in their bid for judicial confirmation of imperfect
title, namely: Philippine Bill of 1902 in relation to Act No. 926, later amended and/or superseded by Act
No. 2874 and CA No. 141; Proclamation No. 1801 issued by then President Marcos; and Proclamation
No. 1064 issued by President Gloria Macapagal-Arroyo. We shall proceed to determine their rights to
apply for judicial confirmation of imperfect title under these laws and executive acts. But first, a peek at
the Regalian principle and the power of the executive to reclassify lands of the public domain.

The 1935 Constitution classified lands of the public domain into agricultural, forest or
timber. Meanwhile, the 1973 Constitution provided the following divisions: agricultural, industrial or
commercial, residential, resettlement, mineral, timber or forest and grazing lands, and such other
classes as may be provided by law, giving the government great leeway for classification. Then the 1987
Constitution reverted to the 1935 Constitution classification with one addition: national parks. Of
these, only agricultural lands may be alienated. Prior to Proclamation No. 1064 of May 22, 2006, Boracay
Island had never been expressly and administratively classified under any of these grand divisions.
Boracay was an unclassified land of the public domain.

The Royal Decree of 1894 or the Maura Law partly amended the Spanish Mortgage Law and the Laws of
the Indies. It established possessory information as the method of legalizing possession of vacant Crown
land, under certain conditions which were set forth in said decree. Under Section 393 of the Maura Law,
an information posesoria or possessory information title, when duly inscribed in the Registry of
Property, is converted into a title of ownership only after the lapse of twenty (20) years of uninterrupted
possession which must be actual, public, and adverse, from the date of its inscription. However,
possessory information title had to be perfected one year after the promulgation of the Maura Law, or
until April 17, 1895. Otherwise, the lands would revert to the State.

The first law governing the disposition of public lands in the Philippines under American rule was
embodied in the Philippine Bill of 1902. By this law, lands of the public domain in the Philippine Islands
were classified into three grand divisions, to wit: agricultural, mineral, and timber or forest lands. The
act provided for, among others, the disposal of mineral lands by means of absolute grant (freehold
system) and by lease (leasehold system).

In other words, that the phrase "agricultural land" as used in Act No. 926 means those public lands
acquired from Spain which are not timber or mineral lands.
HEIRS OF JUANCHO ARDONA v. JUAN Y. REYES 

GR Nos. 60549, Oct 26, 1983

FACTS:

This is a petition for certiorari with preliminary injunction challenging the constitutionality of
Presidential Decree No. 564, the Revised Charter of the Philippine Tourism Authority, and Proclamation
No. 2052 declaring the barangays of Sibugay, Malubog, Babag and Sirao including the proposed Lusaran
Dam in the City of Cebu and in the municipalities of Argao and Dalaguete in the province of Cebu as
tourist zones. The petitioners ask that we restrain respondents Court of First Instance of Cebu and the
Philippine Tourism Authority (PTA) from enforcing and implementing the writs of possession issued in
four (4) expropriation cases filed by PTA against petitioners: Civil Cases Nos. R-19562, R-19684, R-20701,
and R-21608 of the Court of First Instance of Cebu (Branch I).
The Philippine Tourism Authority filed four (4) complaints with the Court of First Instance of Cebu City
for the expropriation of some 282 hectares of rolling land situated in barangays Malubog and Babag,
Cebu City, under PTA's express authority "to acquire by purchase, by negotiation or by condemnation
proceedings any private land within and without the tourist zones" for the purposes indicated in Section
5, paragraph B(2), of its Revised Charter (PD 564), more specifically, for the development into integrated
resort complexes of selected and well-defined geographic areas with potential tourism value. As
uniformly alleged in the complaints, the purposes of the expropriation are:
... ... ...
"Plaintiff, in line with the policy of the government to promote tourism and development of tourism
projects will construct in Barangays Maiubog, Busay and Babag, all of Cebu City, a sports complex
(basketball courts, tennis courts, volleyball courts, track and field, baseball and softball diamonds, and
swimming pools), club house, golf course, children's playground and a nature area for picnics and
horseback riding for the use of the public. 
"The development plan, covering approximately 1,000 hectares, includes the establishment of an
electric power grid in the area by the National Power Corporation, thus assuring the supply of electricity
therein for the benefit of the whole community. Deep wells will also be constructed to generate water
supply within the area. Likewise, a complex sewerage and drainage system will be devised and
constructed to protect the tourists and nearby residents from the dangers of pollution.
"Complimentary and support facilities for the project will be constructed, including public rest houses,
lockers, dressing rooms, coffee shops, shopping malls, etc. Said facilities will create and offer
employment opportunities to residents of the community and further generate income for the whole of
Cebu City. The defendants in Civil Cases Nos. R-20701 and R-21608 filed their respective Opposition with
Motion to Dismiss and/or Reconsideration. The defendants in Civil Case No. R-19562 filed a
manifestation adopting the answer of defendants in Civil Case No. R-19864. The defendants, now
petitioners, had a common allegation in that the taking is allegedly not impressed with public use under
the Constitution.
In their motions to dismiss, the petitioners alleged, in addition to the issue of public use, that there is no
specific constitutional provision authorizing the taking of private property for tourism purposes; that
assuming that PTA has such power, the intended use cannot be paramount to the determination of the
land as a land reform area; that limiting the amount of compensation by legislative fiat is constitutionally
repugnant; and that since the land is under the land reform program, it is the Court of Agrarian Relations
and not the Court of First Instance, that has jurisdiction over the expropriation cases.
The Philippine Tourism Authority having deposited with the Philippine National Bank, Cebu City Branch,
an amount equivalent to 10% of the value of the properties pursuant to Presidential Decree No. 1533,
the lower court issued separate orders authorizing PTA to take immediate possession of the premises
and directing the issuance of writs of possession.

ISSUE:

The petitioners revolve around the proposition that the actions to expropriate their properties are
constitutionally infirm because nowhere in the Constitution can a provision be found which allows the
taking of private property for the promotion of tourism.
The petitioner's arguments in their pleadings in support of the above proposition are subsumed under
the following headings: Non-compliance with the "public use" requirement under the eminent domain
provision of the Bill of Rights. 
 
Disregard of the land reform nature of the property being expropriated. Impairment of the obligation of
contracts.
There are three provisions of the Constitution which directly provide for the exercise of the power of
eminent domain. Section 2, Article IV states that private property shall not be taken for public use
without just compensation. Section 6, Article XIV allows the State, in the interest of national welfare or
defense and upon payment of just compensation to transfer to public ownership, utilities and other
private enterprises to be operated by the government. Section 13, Article XIV states that the Batasang
Pambansa may authorize upon payment of just compensation the expropriation of private lands to be
subdivided into small lots and conveyed at cost to deserving citizens.
While not directly mentioning the expropriation of private properties upon payment of just
compensation, the provisions on social justice and agrarian reforms which allow the exercise of police
power together with the power of eminent domain in the implementation of constitutional objectives
are even more far-reaching insofar as taking of private property is concerned.
Section 6, Article II provides:
"Sec. 6. The State shall promote social justice to ensure the dignity, welfare, and security of all the
people. Towards this end, the State shall regulate the acquisition, ownership, use, enjoyment, and
disposition of private property, and equitably diffuse property ownership and profits."       

RULING:
Likewise in Ramos v. Philippine Tourism Authority (G.R. Nos. 52449-50, June 9, 1980), this Court
held: condemnation or expropriation proceedings is in the nature of one that is quasi-in-rem, wherein
the fact that the owner of the property is made a party is not essentially indispensable insofar at least as
it concerns the immediate taking of possession of the property and the preliminary determination of its
value, including the amount to be deposited.
In their last argument, the petitioners claim that a consequence of the expropriation proceedings would
be their forcible ejectment. They contend that such forcible ejectment is a criminal act under
Presidential Decree No. 583. This contention is not valid. Presidential Decree No. 583 prohibits the The
petitioners have failed to overcome the burden of anyone trying to strike down a statute or decree
whose avowed purpose is the legislative perception of the public good. A statute has in its favor the
presumption of validity. All reasonable doubts should be resolved in favor of the constitutionality of a
law. The courts will not set aside a law as violative of the Constitution except in a clear case
(People v. Vera, 65 Phil. 56). And in the absence of factual findings or evidence to rebut the presumption
of validity, the presumption prevails (Ermita-Malate Hotel, etc. v. Mayor of Manila, 20 SCRA 849;
Morfe v. Mutuc, 22 SCRA 424).
The public respondents have stressed that the development of the 808 hectares includes plans that
would give the petitioners and other displaced persons productive employment, higher incomes, decent
housing, water and electric facilities, and better living standards. Our dismissing this petition is, in part,
predicated on those assurances. The right of the PTA to proceed with the expropriation of the 282
hectares already identified as fit for the establishment of a resort complex to promote tourism is,
therefore, sustained.
WHEREFORE, the instant petition for certiorari is hereby DISMISSED for lack of merit.