CD: U.S. v. Filart and Singson

August 31, 2010 at 4:38 pm (1915, Case Digests) (, )

U.S. v. JAIME FILART AND HILARIO SINGSON
G.R. No. L-10263 March 13, 1915
Moreland, J.

Doctrine:
A lottery is defined as a scheme for the distribution of prizes by chance among persons who have paid, or agreed to pay, a valuable consideration for the chance to obtain a prize. Its elements are: (1) a consideration; (2) chance: (3) a prize, or some advantage or inequality in amount or value which is in the nature of prize.

Facts:
Filart and Singson took part in a lottery or raffle of an automobile, which was the property of Filart.

The winner was determined in the following manner: The numbers composing the 450, each written on a separate piece of paper, were placed together in a box and thoroughly mixed. A boy was selected who placed his hand in the box and drew out a number. This he delivered to a person who unfolded the paper and read the number in a loud voice while Filart, with a list of the 450 numbers referred to, struck from the list the number corresponding to that drawn from the box. This was repeated until all of the numbers were drawn from the box and stricken from the list. It was agreed that the last number drawn from the box should be the winning number and that the owner of that number should win the automobile.

Both defendants were charged for violating the following provisions of the law:

Section 7 of Act No. 1757 provides, as follows:
The playing at and the conducting of any game of monte, jueteng, or any form of lottery or policy . . . is hereby prohibited, and any person taking any part therein . . . shall be punished as provided in section 3 hereof. . . . .

This section also provides that:

It shall be no defense to any criminal action under this section that the defendant acted as the agent of another or that he had no interest in the result.

Issue:
Whether or not the defendants conducted lottery

Held:
Yes. The facts of record place this case within the definition generally given of a lottery.

A lottery is said to be “a species of gaming, which may be defined as a scheme for the distribution of prizes by chance among persons who have paid, or agreed to pay, a valuable consideration for the chance to obtain a prize.” It was held in the case of Equitable Loan Co. vs. Waring, 117 Ga., 599, that three elements enter into a lottery scheme: (1) A consideration; (2) chance: (3) a prize, or some advantage or inequality in amount or value which is in the nature of prize.

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CD: AT&T Communications Services Philippines, Inc. v. CIR

August 27, 2010 at 3:26 pm (2010, Case Digests) (, )

AT&T COMMUNICATIONS SERVICES PHILIPPINES, INC. v. CIR
G.R. No. 182364 August 3, 2010
Carpio Morales, J.

Doctrine:
Section 113 of the Tax Code does not create a distinction between a sales invoice and an official receipt.

Facts:
Petitioner filed with the respondent an application for tax refund and/or tax credit of its excess/unutilized input VAT from zero-rated sales. To prevent the running of the prescriptive period, petitioner subsequently filed a petition for review with the CTA.

The CTA held that since petitioner is engaged in sale of services, VAT Official Receipts should have been presented in order to substantiate its claim of zero-rated sales, not VAT invoices which pertain to sale of goods or properties.

Issue:
Whether or not a Sales Invoice would suffice as a proof for entitlement to a refund of unutilized input VAT from zero-rated sales, even for seller of services

Held:
Yes. Section 113 of the Tax Code does not create a distinction between a sales invoice and an official receipt. Parenthetically, to determine the validity of petitioner’s claim as to unutilized input VAT, an invoice would suffice provided the requirements under Sections 113 and 237 of the Tax Code are met.

Sales invoices are recognized commercial documents to facilitate trade or credit transactions. They are proofs that a business transaction has been concluded, hence, should not be considered bereft of probative value (Seaoil Petroleum Corporation v. Autocorp Group, G.R. No. 164326, October 17, 2008). Only the preponderance of evidence threshold as applied in ordinary civil cases is needed to substantiate a claim for tax refund proper (Commissioner of Internal Revenue v. Mirant Pagbilao Corporation, G.R. No. 172129, September 12, 2008).

A taxpayer engaged in zero-rated transactions may apply for tax refund or issuance of tax credit certificate for unutilized input VAT, subject to the following requirements: (1) the taxpayer is engaged in sales which are zero-rated (i.e., export sales) or effectively zero-rated; (2) the taxpayer is VAT-registered; (3) the claim must be filed within two years after the close of the taxable quarter when such sales were made; (4) the creditable input tax due or paid must be attributable to such sales, except the transitional input tax, to the extent that such input tax has not been applied against the output tax; and (5) in case of zero-rated sales, the acceptable foreign currency exchange proceeds thereof have been duly accounted for in accordance with BSP rules and regulations.

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Topping the Bar

August 27, 2010 at 2:22 pm (Legal Articles) (, )

The 2010 Philippine Bar Examinations is just around the corner. I can say that for most, if not all, examinees, this is one life-changing examination. Although I haven’t taken the Bar yet, I agree with the majority who says that this is one of the toughest bar examinations in the world.

I would like to share this article of Former Chief Justice Artemio V. Panganiban to boost the morale of this year’s examinees. God be with you all!

With Due Respect: How to Pass, Nay, Top the Bar Exams
By Artemio V. Panganiban
Columnist
Philippine Daily Inquirer
Posted date: April 19, 2008

Last Sunday, I commented on the dismal results of the 2007 bar exams. I said that it was high time the Supreme Court, the Philippine president and the law schools collaborated to produce better lawyers. “We concur,” chorused many readers. But the more pressing query of law students and reviewees for the 2008 test is “Can you give us tips on how to pass the 2008 tests?

Having taken the exams eons ago, I felt inadequate answering the question. Besides, I placed only sixth. So I called someone more qualified, 2005 topnotcher Joan de Venecia. In turn, she summoned help from two other numero unos, Arlene Maneja (2002) and Mercedita Ona (2007). Incidentally, Arlene comes from UST, Joan from UP and Mercedita from Ateneo de Manila. Here are their common tips.

Believe that you deserve to take the test. Forget the times you botched up a recitation or failed an exam. You’re past that. Believe that you have been allowed to sit for the bar because you have a fighting chance to pass it. Cultivate composure with that thought. You’ll need it.

Make time for serious self-evaluation. Have an honest assessment of the subjects you are good at, and those you feel you have an inadequate foundation on. If you sincerely believe that you do not have sufficient knowledge of a particular subject, accept it humbly and know that you still have a number of months to study for it. Adjust the number of days devoted to each subject according to the results of your self-assessment. A schedule is recommended to serve as a guide as to how many days you can allot for every subject.

Have a study plan and be realistic about it. At the start of the bar review, set aside all the materials you want to cover—all the books, reviewers and notes for each subject. Make it your guide and pace yourself. People without a plan either underestimate the workload or get swamped with available materials; either way, they don’t finish everything. So too, organize your review materials. Time is of the essence during the bar review. You cannot afford to waste time by looking for misplaced review materials. Maintain eight separate boxes or drawers for each of the subjects. This will help you sort through your materials and decide which to read during your pre-week.

Be realistic about your capabilities. People say they will “start afresh” during the bar review—study more, play less. That’s nice but it rarely happens. So, in setting a study plan, be kind to yourself. Give yourself time to attend review lectures, to wake up late, to be lazy, to go out and to have fun. The bar test is difficult enough without making yourself sick because of unrealistic expectations.

Do not compare yourself with other reviewees. We all have our own rhythm. Listen to yours. Bar preparation is an individual task. It is ultimately your understanding of the law and its varied nuances, not how many readings you do, or the laws that you memorize verbatim that makes the difference.

Be physically fit. Try to get regular exercise. Eat nourishing meals. Get enough sleep every day. Take vitamins and supplements. Manage your stress. Remember, all your efforts will be wasted when your body bogs down.

Use your time wisely. Sit in a review class or do personal reading? If you know the subject well enough, refresh yourself by attending review classes. If not, read up first. Review classes assume a certain level of knowledge and, without it, you’ll be lost during the discussion and waste valuable time. Know that you still have the pre-week review for all those “bar tips” that most reviewers give.

Abandon all emotional problems. Inform your family and friends about what you are going through in preparing for and in taking the exam. Ask for their understanding and support. The last thing you need is additional source of stress when preparing for the bar is draining enough. Avoid all distractions. Keep your focus.

Perfect your handwriting and grammar. Bar examiners have to go through thousands of exam booklets, and they are only human. As would any other normal person, they appreciate, and understand more, an answer that is at the very minimum, readable and logical. All three topnotchers have good handwriting, and believe that their passing, nay topping, the bar was in large part due to this. So, practice writing neatly, legibly and fast.

If you are a visual person write down your notes. This exercise will aid your quest for a beautiful penmanship, and help you retain the facts and the law that may be difficult to retrieve as you store more information in your brain bank.

Study smartly. Streamline. Codal provisions, a good reviewer for each subject and updates on jurisprudence should suffice. Master the basics. Understand the substance of the law and how to apply it to given situations. Recall legal provisions during your spare time. Listen to audio codals when you travel.

Ask for updates. Doctrines that you have studied in school may have already been overturned or modified by the Supreme Court or by Congress. Request your bar operations team to include abbreviated facts in the updates, because bar questions are often facts-based.

Pray. Pray. Pray.

A final reminder. There is no shortcut to passing the bar. If you want to pass on the first take, you have to put in the hours, and get yourself in the mood to study. Do not focus on things you cannot control (e.g., bar examiners, kinds of questions). Devote all your energies to studying and positive thinking. Good luck!

* * *

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CD: Amosco v. Judge Magro

August 25, 2010 at 2:34 pm (1976, Case Digests) (, , )

AMOSCO v. JUDGE MAGRO
A.M. No. 439-MJ September 30, 1976
Fernando, J.

Doctrine:
Misconduct is such act or conduct as affects the performance of the duties of a public officer and not only such as affects his character as a private individual.

In order for serious misconduct to be shown, there must be reliable evidence showing that the judicial acts complained of were corrupt or inspired by an intention to violate the law, or were in persistent disregard of well known legal rules.

Facts:
Petitioner stated that respondent judge must be held answerable of grave misconduct for the latter’s alleged failure to pay the Burma sacks purchased.

Acting Judicial Consultant, Justice Lorenzo Relova recommended for the outright dismissal of the case. As ruled by Relova, the term ‘just debts’, applies to (1) claims adjudicated by a court of law, or (2) claims the existence and justness of which are admitted by the debtor [Section 19(N), Rule XVIII, B, Civil Service Rules]. Respondent’s defense that the debt was already settled, as evidenced by the original receipt issued by Amosco, would already refute complainant’s assertion and place the money claim beyond the purview of the term “just debts.”

Issue:
Whether or not the non-payment of a debt by a judge is considered “gross misconduct” as to warrant his removal from office

Held:
No. Misconduct is such act or conduct as affects the performance of the duties of a public officer and not only such as affects his character as a private individual. It is necessary to separate the character of the man from the character of the officer. Misconduct, malfeasance or misfeasance warranting removal from office of an officer, must have direct relation to and be connected with the performance of official duties amounting either to maladministration or willful intentional neglect and failure to discharge the duties of the office (Lacson v. Lopez).

In order for serious misconduct to be shown, there must be reliable evidence showing that the judicial acts complained of were corrupt or inspired by an intention to violate the law, or were in persistent disregard of well known legal rules (In re Horilleno).

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CD: Aspillaga v. Aspillaga

August 18, 2010 at 3:49 pm (2009, Case Digests) (, , )

ASPILLAGA v. ASPILLAGA
G.R. No. 170925 October 26, 2009
Quisumbing, J.

Doctrine:
The fact that certain psychological conditions will hamper their performance of their marital obligations does not mean that they suffer from psychological incapacity as contemplated under Article 36 of the Family Code. Psychological disorders do not manifest that both parties are truly incapacitated to perform the basic marital covenants. Mere difficulty is not synonymous to incapacity. Psychological incapacity is reserved to the most serious cases of personality disorder.

Facts:
Rodolfo Aspillaga filed a petition for annulment of marriage on the ground of psychological incapacity on the part of Aurora Aspillaga. Aurora alleged upon her return to Manila, she discovered that while she was in Japan, Rodolfo brought into their conjugal home her cousin, Lecita Rose A. Besina, as his concubine. Aurora alleged that Rodolfo’s cohabitation with her cousin led to the disintegration of their marriage and their eventual separation.

During trial, expert witness Dr. Eduardo Maaba explained that both parties are psychologically incapacitated. The RTC found the parties psychologically incapacitated to enter into marriage.

The CA reversed the RTC decision and declared the marriage of Rodolfo and Aurora Aspillaga valid. Petitioner filed a motion for reconsideration, but the motion was also denied. Hence this petition.

Issue:
Whether or not the marriage is void on the ground of the parties’ psychological incapacity

Held:
No. As early as 1995, in Santos v. Court of Appeals (G.R. No. 112019, January 4, 1995), it has been categorically ruled that:

Psychological incapacity required by Art. 36 must be characterized by (a) gravity, (b) juridical antecedence, and (c) incurability. The incapacity must be grave or serious such that the party would be incapable of carrying out the ordinary duties required in marriage; it must be rooted in the history of the party antedating the marriage, although the overt manifestations may emerge only after the marriage; and it must be incurable or, even if it were otherwise, the cure would be beyond the means of the party involved.

In the instant case, Dr. Maaba failed to reveal that the psychological conditions were grave or serious enough to bring about an incapacity to assume the essential obligations of marriage. Indeed, Dr. Maaba was able to establish the parties’ personality disorder; however, he failed to link the parties’ psychological disorders to his conclusion that they are psychologically incapacitated to perform their obligations as husband and wife. The fact that these psychological conditions will hamper their performance of their marital obligations does not mean that they suffer from psychological incapacity as contemplated under Article 36 of the Family Code. Mere difficulty is not synonymous to incapacity.

It must be stressed that psychological incapacity must be more than just a “difficulty,” “refusal” or “neglect” in the performance of some marital obligations (Republic v. CA). The intention of the law is to confine the meaning of “psychological incapacity” to the most serious cases of personality disorders clearly demonstrative of an utter insensitivity or inability to give meaning and significance to the marriage (Tongol v. Tongol, G.R. No. 157610, October 19, 2007).

Psychological disorders do not manifest that both parties are truly incapacitated to perform the basic marital covenants. Moreover, there is nothing that shows incurability of these disorders. Incompatibility and irreconcilable differences cannot be equated with psychological incapacity as understood juristically.

As to Rodolfo’s allegation that Aurora was a spendthrift, the same likewise fails to convince. While disagreements on money matters would, no doubt, affect the other aspects of one’s marriage as to make the wedlock unsatisfactory, this is not a ground to declare a marriage null and void. In fact, the Court takes judicial notice of the fact that disagreements regarding money matters are a common, and even normal, occurrence between husbands and wives.

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CD: Roa v. Heirs of Santiago Ebora

August 18, 2010 at 2:34 pm (2010, Case Digests) (, , )

ROA v. HEIRS OF SANTIAGO EBORA
G.R. No. 161137 March 15, 2010
Corona, J.

Doctrine:
Any right acquired by one buyer over a disputed property cannot prevail over, but must yield to, any superior right possessed by another buyer. The spring cannot rise higher than its source.

Facts:
A parcel of land, which was continuously, openly and adversely possessed by Santiago Ebora, was mistakenly included by Chacon Enterprises in its application for original registration. As a result, litigation arose between the heirs of Ebora and Chacon Enterprises.

During the case’s pendency, the heirs of Ebora sold the land to their co-heir Josefa Ebora Pacardo (Josefa) and her husband Rosalio Pacardo. On the same day, the spouses Pacardo assigned the property to Digno Roa, married to petitioner Lydia Roa. The corresponding deeds of absolute sale and assignment were inscribed on original certificate of title (OCT) and a transfer certificate of title was issued in the name of Digno Roa.

The case was resolved against Chacon Enterprises and in favor of the heirs of Ebora.

Thereafter the heirs of Ebora again adjudicated the land among themselves, pro indiviso. That same day, a deed of confirmation of a prior conveyance by Josefa to respondent Samuel Sonnie Lim of a portion was likewise inscribed on TCT No. T-48097. The issuance of new TCTs in the name of Alejandro Ebora was likewise inscribed in the same. The lots were thereafter sold to various respondents which resulted in the issuance of new TCTs in the names of the respective vendees.

All these transactions occurred without petitioner’s knowledge and consent.

In view of the death of her husband, petitioner filed a petition for annulment and cancellation of TCT No. 48097 and its derivative titles. The RTC ruled against the petitioner. Hence, this petition for review on certiorari.

Issue:
Whether or not the petitioner has a superior right over the land as against the respondents

Held:
Yes. From the moment the disputed land was sold to the spouses Pacardo, the heirs of Ebora lost all their rights and interest over the property.

Thus, the heirs of Ebora had nothing to adjudicate among themselves. Neither did they have anything to transfer to the vendees or successors-in-interest. As such, the transferees of the heirs of Ebora acquired no better right than that of the transferors. The spring cannot rise higher than its source.

Whatever right a buyer, notwithstanding the fact that he is an innocent purchaser for value, may have acquired over the disputed property cannot prevail over, but must yield to, the superior right possessed by another buyer.

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Doctrine of Innocent Purchaser

August 18, 2010 at 9:25 am (Legal Definitions) (, )

Today, the Supreme Court is set to hear the oral arguments of the petition involving the Hacienda Luisita dispute. Petitioners, who are also President Benigno Aquino III’s cousins, are seeking to overturn a 2005 decision by the Presidential Agrarian Reform Council (PARC) scratching the stock distribution option (SDO) under CARP reached in 1989.

One of the issues to be discussed is whether the Luisita Industrial Park Corp. and Rizal Commercial Banking Corp., as transferees of a portion of the 6,500-hectare estate, may invoke the “doctrine of innocent purchaser.”

Now, what is exactly the doctrine of innocent purchaser?

The subject is summarily discussed in the case of Tan v. Dela Vega, G.R. No. 168809, 10 July 2006.

Accordingly, the doctrine of innocent purchaser rules that a void title may be the source of a valid title in the hands of an innocent purchaser for value. An innocent purchaser for value is one who buys the property of another, without notice that some other person has a right to, or interest in, such property and pays a full and fair price for the same at the time of such purchase, or before he has notice of the claims or interest of some other person in the property.

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CD: Continental Steel v. Montaño

August 16, 2010 at 12:25 pm (2009, Case Digests) (, , )

Continental Steel v. Montaño
G.R. No. 182836 October 13, 2009
Chico-Nazario, J.

Doctrines:
Life is not synonymous with civil personality. One need not acquire civil personality first before he/she could die. Even a child inside the womb already has life.

In case of doubt in the interpretation of any law or provision affecting labor, such should be interpreted in favor of labor.

Facts:
Hortillano, an employee of petitioner Continental Steel Manufacturing Corporation (Continental Steel) filed a claim for Paternity Leave, Bereavement Leave and Death and Accident Insurance for dependent, pursuant to the Collective Bargaining Agreement (CBA).

The claim was based on the death of Hortillano’s unborn child. Hortillano’s wife had a premature delivery while she was in the 38th week of pregnancy. The female fetus died during labor due to fetal Anoxia secondary to uteroplacental insufficiency.

Petitioner immediately granted Hortillano’s claim for paternity leave but denied his claims for bereavement leave and other death benefits.

It was maintained by Hortillano, through the Labor Union, that the provisions of the CBA did not specifically state that the dependent should have first been born alive or must have acquired juridical personality so that his/her subsequent death could be covered by the CBA death benefits.

Petitioner argued that the express provision of the CBA did not contemplate the death of an unborn child, a fetus, without legal personality. It claimed that there are two elements for the entitlement to the benefits, namely: (1) death and (2) status as legitimate dependent, none of which existed in Hortillano’s case. Continental Steel contended that only one with civil personality could die, relying on Articles 40, 41 and 42 of the Civil Code which provides:

Article 40. Birth determines personality; but the conceived child shall be considered born for all purposes that are favorable to it, provided it be born later with the conditions specified in the following article.

Article 41. For civil purposes, the fetus is considered born if it is alive at the time it is completely delivered from the mother’s womb. However, if the fetus had an intra-uterine life of less than seven months, it is not deemed born if it dies within twenty-four hours after its complete delivery from the maternal womb.

Article 42. Civil personality is extinguished by death. The effect of death upon the rights and obligations of the deceased is determined by law, by contract and by will.

Hence according to the petitioner, the unborn child never died because it never acquired juridical personality. Proceeding from the same line of thought, Continental Steel reasoned that a fetus that was dead from the moment of delivery was not a person at all. Hence, the term dependent could not be applied to a fetus that never acquired juridical personality.

Labor arbiter Montaño argued that the fetus had the right to be supported by the parents from the very moment he/she was conceived. The fetus had to rely on another for support; he/she could not have existed or sustained himself/herself without the power or aid of someone else, specifically, his/her mother.

Petitioner appealed with the CA, who affirmed the Labor Arbiter’s resolution. Hence this petition.

Issues:
1. Whether or not only one with juridical personality can die
2. Whether or not a fetus can be considered as a dependent
3. Whether or not any ambiguity in CBA provisions shall be settled in favor of the employee

Held:
1. No. The reliance of Continental Steel on Articles 40, 41 and 42 of the Civil Code for the legal definition of death is misplaced. Article 40 provides that a conceived child acquires personality only when it is born, and Article 41 defines when a child is considered born. Article 42 plainly states that civil personality is extinguished by death. The issue of civil personality is not relevant in this case.

The above provisions of the Civil Code do not provide at all a definition of death. Moreover, while the Civil Code expressly provides that civil personality may be extinguished by death, it does not explicitly state that only those who have acquired juridical personality could die.

Life is not synonymous with civil personality. One need not acquire civil personality first before he/she could die. Even a child inside the womb already has life.

No less than the Constitution recognizes the life of the unborn from conception, that the State must protect equally with the life of the mother. If the unborn already has life, then the cessation thereof even prior to the child being delivered, qualifies as death.

2. Yes. Even an unborn child is a dependent of its parents. Hortillano’s child could not have reached 38-39 weeks of its gestational life without depending upon its mother, Hortillano’s wife, for sustenance. The CBA did not provide a qualification for the child dependent, such that the child must have been born or must have acquired civil personality. Without such qualification, then child shall be understood in its more general sense, which includes the unborn fetus in the mother’s womb.

3. Time and again, the Labor Code is specific in enunciating that in case of doubt in the interpretation of any law or provision affecting labor, such should be interpreted in favor of labor. In the same way, the CBA and CBA provisions should be interpreted in favor of labor. As decided by this Court, any doubt concerning the rights of labor should be resolved in its favor pursuant to the social justice policy. (Terminal Facilities and Services Corporation v. NLRC [199 SCRA 265 (1991)])

Bereavement leave and other death benefits are granted to an employee to give aid to, and if possible, lessen the grief of, the said employee and his family who suffered the loss of a loved one. It cannot be said that the parents’ grief and sense of loss arising from the death of their unborn child, who, in this case, had a gestational life of 38-39 weeks but died during delivery, is any less than that of parents whose child was born alive but died subsequently.

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CD: Commissioner of Internal Revenue v. Eastern Telecommunications Philippines

August 16, 2010 at 12:12 pm (2010, Case Digests) (, )

Commissioner of Internal Revenue v. Eastern Telecommunications Philippines
G.R. No. 163835 July 7, 2010
Brion, J.

Doctrine:
Lapses in the literal observance of a rule of procedure may be overlooked when they have not prejudiced the adverse party and especially when they are more consistent with upholding settled principles in taxation.

The burden of strict compliance with statutory and administrative requirements by the person claiming for a tax refund cannot be offset by the non-observance of procedural technicalities by the government’s tax agents when the non-observance of the remedial measure addressing it does not in any manner prejudice the taxpayer’s due process rights.

Facts:
Eastern filed with the CIR a written application for refund or credit of unapplied input taxes it paid on the imported equipment purchased during 1995 and 1996 amounting to P22,013,134.00. To toll the running of the two-year prescriptive period under the same provision, Eastern filed an appeal with the CTA. The CTA found that Eastern has a valid claim for the refund/credit of the unapplied input taxes, declaring it entitled to a tax refund of P16,229,100.00.

The CIR filed a motion for reconsideration of the CTA’s decision. Subsequently, it filed a supplemental motion for reconsideration. The CTA denied the CIR’s motion for reconsideration. The CIR then elevated the case to the CA, who affirmed the CTA ruling and likewise denied the subsequent motion for reconsideration. Hence, the present petition.

The CIR posits that, applying Section 104(A) of the Tax Code on apportionment of tax credits, Eastern is entitled to a tax refund of only a portion of the amount claimed. Since the VAT returns clearly reflected income from exempt sales, the CIR asserts that this constitutes as an admission on Eastern’s part that it engaged in transactions not subject to VAT. Hence, the proportionate allocation of the tax credit to VAT and non-VAT transactions provided in Section 104(A) of the Tax Code should apply.

Eastern objects to the arguments raised in the petition, alleging that these have not been raised in the Answer filed by the CIR before the CTA and was only raised. In fact, the CIR only raised the applicability of Section 104(A) of the Tax Code in his supplemental motion for reconsideration of the CTA’s ruling. Eastern claims that for the CIR to raise such an issue now would constitute a violation of its right to due process; following settled rules of procedure and fair play, the CIR should not be allowed at the appeal level to change his theory of the case.

Eastern further argues that there is no evidence on record that would evidently show that respondent is also engaged in other transactions that are not subject to VAT.

Issue:
Whether or not the rule in Section 104(A) of the Tax Code on the apportionment of tax credits can be applied in appreciating Eastern’s claim for tax refund, considering that the matter was raised by the CIR only when he sought reconsideration of the CTA ruling

Held:
Yes. The question of the applicability of Section 104(A) of the Tax Code was already raised but the tax court did not rule on it. This failure should not be taken against the CIR. The mere declaration of exempt sales in the VAT returns, whether based on Section 103 of the Tax Code or some other special law, should have prompted for the application of Section 104 (A) of the Tax Code to Eastern’s claim.

The general rule is that appeals can only raise questions of law or fact that (a) were raised in the court below, and (b) are within the issues framed by the parties therein (People v. Echegaray, G.R. No. 117472). An issue which was neither averred in the pleadings nor raised during trial in the court below cannot be raised for the first time on appeal.

The rule against raising new issues on appeal is not without exceptions; it is a procedural rule that the Court may relax when compelling reasons so warrant or when justice requires it. What constitutes good and sufficient cause that would merit suspension of the rules is discretionary upon the courts (CIR v. Mirant Pagbilao Corporation, G.R. No. 159593). Another exception is when the question involves matters of public importance.

“Taxes are the lifeblood of the government.” For this reason, the right of taxation cannot easily be surrendered; statutes granting tax exemptions are considered as a derogation of the sovereign authority and are strictly construed against the person or entity claiming the exemption. Claims for tax refunds, when based on statutes granting tax exemption or tax refund, partake of the nature of an exemption; thus, the rule of strict interpretation against the taxpayer-claimant similarly applies (CIR v. Fortune Tobacco Corporation, G.R. Nos. 167274-75).

The taxpayer is charged with the heavy burden of proving that he has complied with and satisfied all the statutory and administrative requirements to be entitled to the tax refund. This burden cannot be offset by the non-observance of procedural technicalities by the government’s tax agents when the non-observance of the remedial measure addressing it does not in any manner prejudice the taxpayer’s due process rights.

Lapses in the literal observance of a rule of procedure may be overlooked when they have not prejudiced the adverse party and especially when they are more consistent with upholding settled principles in taxation.

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Supreme Plagiarism

August 9, 2010 at 5:40 pm (Legal Articles) (, )

The Supreme Court is threading a lot of negative criticisms nowadays. This article of Former Chief Justice Artemio V. Panganiban sheds light on the issue of plagiarism facing the High Court.

With Due Respect : Plagiarism in the Supreme Court?
By Artemio V. Panganiban
Columnist
Philippine Daily Inquirer
Posted date: August 07, 2010
 

THE SUPREME Court is once more embattled. This time, the battle relates not just to the wisdom of its decision. This time, it seeps to the very ability and integrity of the Court to write its judgments. A group of litigants is accusing it of plagiarism and of misusing the allegedly plagiarized materials to support the opposite of what the plagiarized items were intended to uphold.Short backgrounder. On April 28, 2010, the Supreme Court en banc, in “Vinuya vs Romulo,” dismissed the petition of more than 70 comfort women belonging to the “Malaya Lolas Organization.” It refused to compel the respondent government officials to secure from Japan an “apology and other forms of reparations” for the rape and other abuses committed by Japanese soldiers against them during World War II.Essentially, the Court ruled that the power to conduct foreign relations is an executive prerogative that the Court could not interfere with. Since the Treaty of Peace with Japan already settled all war claims of the Philippines, the Court said it could not attribute grave abuse to the respondent officials for refusing to take up the cudgels for the comfort women at this late stage.Instead of just challenging the merits of the decision in their motion for reconsideration and supplemental motion for reconsideration, the comfort women’s lawyers—Harry Roque and Romel Bagares—also accused the Court of “wholly lift(ing), without proper attribution, from at least three sources.”They identified the writers and the plagiarized articles as: (1) Evan J. Criddle and Evan Fox-Decent from their article, “A Fiduciary Theory of Jus Cogens” published in 2009 in the Yale Journal of International Law; (2) Christian J. Tams from his book, “Enforcing Erga Omnes Obligations in International Law” published by the Cambridge University Press in 2005; and (3) Mark Ellis from his article, “Breaking the Silence: On Rape as an International Crime” published in the Case Western Reserve Journal of International Law in 2006.

International dimension. Before the Court could rule on these motions, Dr. Mark Ellis—one of the three authors—sent an e-mail to the justices, dated July 23, saying: “In particular, I am concerned about a large part of the extensive discussion in footnote 65, pp. 27-28 of the said Judgment of your esteemed Court. I am also concerned that your esteemed Court may have misread the arguments I made in the article and employed them for cross-purposes. This would be ironic since the article was written precisely to argue for the appropriate legal remedy for victims of war crimes, genocide, and crimes against humanity.” In a blog in Opinio Juris, Criddle found the alleged plagiarism and contrary conclusion “most troubling.”

To stress the international dimension of his intervention, Ellis signed his letter in his capacity as “executive director” of the International Bar Association based in London. IBA is the largest lawyers’ organization in the world.

Soon enough, calls for discipline against the decision writer and the nine justices who concurred in full with the decision (the rest concurred only in part, or only “in the result”) erupted. The Court referred the complaint for investigation and recommendation to the newly created Committee on Ethics and Ethical Standards, composed of Chief Justice Renato C. Corona, chairman; Justice Teresita J. Leonardo de Castro, working vice chair, Justices Roberto A. Abad, Jose P. Perez and Jose C. Mendoza, members. Retired Justice Jose C. Vitug was named a non-voting observer-consultant.

Delicate questions. While the Court acted on the complaint with commendable speed, it still faces major dilemmas because all the Ethics Committee members concurred unqualifiedly in the decision penned by Justice Mariano C. del Castillo. Pages 33 and 34 of the decision show that nine magistrates concurred fully with the ponente; namely, all the five members of the Ethics Committee, plus Justices Presbitero J. Velasco Jr., Arturo D. Brion, Lucas P. Bersamin and Martin S. Villarama Jr.

Five other magistrates scribbled their votes on the signature pages of the decision, as follows: then Chief Justice Reynato S. Puno, “In the result”; Justice Antonio T. Carpio, “I concur on the ground that petitioners’ claims are barred by the Peace Treaty between RP and Japan”; while Justice Antonio Eduardo B. Nachura filed a short separate opinion concurring “in the result on strictly procedural grounds,” to which Justices Conchita Carpio Morales and Diosdado M. Peralta “joined.”

On July 22, Justice Del Castillo wrote his colleagues, saying “(t)here was every intention to attribute all sources whenever due. At no point was there ever any malicious intent to appropriate another’s work as our own… This case has not attained finality; in fact, it is pending resolution of the petitioners’ motion for reconsideration. As such it is still within the power of the Court to reverse or amend its decision…” Last Tuesday, Roque and Bagares were asked to comment on this letter.

The case raises novel questions, like: As it applies to judicial decisions, what constitutes plagiarism? What is the penalty for its commission? Who, if any, should be held responsible? May those who fully concurred with the decision investigate the matter as members of the Ethics Committee?

Having caught national and international attention, the delicate issue of plagiarism as it relates to decision-making deserves prudent, fair and speedy resolution.

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