SALVACION vs CENTRAL BANK

I entered my tita's house and I got greeted by three angry wagging tailed pups. I had to crouch and stretch out my arms and do what Chris Pratt did... "Stand down.. stand down.."

Aw that's probably the best movie I've seen so far this 2015. Seen it just recently, oh no not in the theaters of course, love life is currently arid these days, well by choice.. (tsk.. would somebody get back from Canada! damn it)  On the couch, lights out, ear plugs, wifi. Dang the movie's that good I kept adjusting my glasses I couldn't put the damn tablet down.       

Anyway. Let's get back to the cases. 

This is ah... well this is not a rape case perse, because we'll be tackling not the criminal but the civil aspect of this case in order to contribute in our having a good grasp of typical banking laws and how it works. Although it started that way (criminally). But what were after here for is the controversial Supreme Court ruling in as far as executing the lower court decision of the attachment or garnishment of the accused' dollar account to pay-off  the moral and exemplary damages awarded by the court since accused resorted to flight.

But first I will let you have a sneak peak to the gruesomeness of this case just so you would know where the Supreme Court was coming from when they decided on this very peculiar case. I know, as a law student I should write this case objectively. Law is after all what 70% exact science? hehe on the basis I guess on our perceived methodological rigor. (and pity has no place in science right?) But I in so far as injustice is concern couldn't muster to digest even more the already digested facts of this case and present you an even more skewed understanding of this case when it pertains to justice. So I will have to present it as it is. But luckily due to my desired appearance of compactness I want my every posts to comply with as standard in this blog, I will have somebody to do it for me. And that means using another blog post by another blogger as supplemental to this post.

Don't ask me, I don't know the guy really, I just accidentally got hold of his writing while browsing the case but click on this, he sort of wrote a blow by blow account of how the exact crime had transpired. Click this: The Eternal Student - The Salvacion Case. or better yet, read the actual case to make it a little bit more sanitized if you want it that way. Here's the link to the actual case- Salvacion vs CBP 

There you go did you read it?  I hear bloods raising now, I'm a vampire I could actually hear it (joke). Makes you wanna question what humanity is really fuckin' made of right? What kind of people are these right??  And makes you wanna clobber that fuckin' bastard right? I know how you feel. The thought of Bartelli's flight alone makes me wanna scream and shout on our public servants who allegedly let this thing happen maybe purely for monetary consideration whatsoever. The accused' mysterious flight alone is already a miscarriage of justice.   

So the American tourist, was arrested for committing four counts of rape and serious illegal detention against the 12 year old Karen Salvacion. Yes its clear this is a pedophile case. And here's what happened after he got arrested. The police recovered from him several dollar checks and a dollar account in the China Bank. He was, however, able to escape from prison as I have implied earlier. So In a civil case filed against him, the trial court awarded Salvacion moral, exemplary and attorney’s fees amounting to almost P1,000,000.00.

Now I really don't know the inter-lying circumstances behind these case. I mean whether the trial court ruling should make me jump up and write "finally justice was rolling!" as I read the case. But who knows, the thought of a clandestine arrangement with the American Embassy may not be too far right? We know and have heard stories of how the American government extensively took care of their beloved citizens even when they're abroad right? The perks of belonging to a world power country. Who knows if some prim and proper US Embassy personnel have met with our locals and said "Listen we don't want this case to get blown out of proportion okay, so we need you to come down with us and settle this in an unwritten bargaining agreement. We know your laws, and one of them expressly and absolutely denies attachment or garnishment of  a foreigner's dollar deposits. We will not hold you accountable for the repercussions of what might be the outcome of this case as long as you let our guy off the hook. That's all we asked for" hmhm. Of course that's just my creative juices working. I will not steal the glory of our courts in their some sort of admirable decisions in this case, but I dunno, it's just that all I see is a naive 12 year old girl who see the world with silver-lined clouds and a good-faith view that all Americans are good. Well reality bites.

And I dunno, maybe its a fact that I hardly see a convicted American behind our local bars. (bars ha.. the one with the vertical designs..remember?)  Hard as I try to justify that premise, sad to say it isn't necessarily so. But I'm not anti-Americans okay? (Oh please please US Embassy don't deny me if ever I'd apply for visa in the near future.. please please :) ) and I know man's morals has degenerated since what after the 1950s?  but I will not hesitate to touch on this racial issue just so that any foreigner that lands their foot on the part of this earth gets the bad signal that they themselves should and would clean up their own ranks. Besides, they themselves are a disgrace to their own race as they consider us to ours. What do you think the bastard will do when he reaches home?  Pop open some bottles of beer with his crooked buddies and revel on his virile exploits? This is one of the reasons why sometimes I believe the barrel of a gun is quicker to do more justice than justice it self.

Now going back to the case, Salvacion's family tried to execute the judgment on the dollar deposit of Bartelli with the China Bank but the latter refused invoking Section 113 of Central Bank Circular No. 960 which exempts foreign currency deposits from attachment nor garnishment. It also invoked Rep. Act No. 1405 (An Act Prohibiting Disclosure of or Inquiry into, Deposits with any Banking Institution) as its answer to the notice of garnishment.

Asked to comment on the petition of Salvacion, the Central Bank reiterated its stand and said that Section 113 of CB Circular No. 960 was copied verbatim from a portion of RA No. 6426 as amended by P.D. No. 1246, which amended among other things, Section 8 of the law, which reads: Sec. 8. Secrecy of Foreign Currency Deposits. – All foreign currency deposits authorized under this Act, as amended by Presidential Decree No. 1035, as well as foreign currency deposits authorized under Presidential Decree No. 1034, are hereby declared as and considered of an absolute confidential nature and, except upon the written permission of the depositors, in no instance shall such foreign currency deposits be examined, inquired or looked into by any person, government official, bureau or office whether judicial or administrative or private; Provided, however, that said foreign currency deposits shall be exempt from attachment, garnishment, or any other order or process of any court, legislative body, government agency or any administrative body whatsoever. It explained that the purpose of the law is to encourage dollar accounts within the country’s banking system, which would help in the development of the economy, and even said that the law may be harsh as some perceive it, but it is still the law.

Well for its part, lets give China Bank a little bit of credit here. Expressing sorrow or sympathy with the ordeal of the minor. It was only too willing to release the dollar deposit of the foreigner but refrained from doing so because the law prevented it and it has no choice but to follow the law.

The Solicitor General expressed a different view stressing "the far-reaching implications on the right of a national to obtain redress for a wrong committed by an alien who takes refuge under a law and regulation promulgated for a purpose which does not contemplate the application thereof in this case. It opined that the law seeks to protect a lender or investor but not a mere transient or tourist who is not expected to maintain the deposit in the bank for long."

FINALLY THE ISSUE: 

Should Section 113 of Central Bank Circular No. 960 and Section 8 of Republic Act No. 6426, as amended by PD 1246, otherwise known as the Foreign Currency Deposit Act be made applicable to a foreign transient?

Well basically there are 2 laws (among others) which is the subject of controversy here.

R.A. 1405 - which is the Bank Secrecy Law
R.A. 6426 - which is the Foreign Currency Deposit Act

The former covers all bank deposits and no distinction is made between domestic and foreign deposits, the latter which is a special law is designed especially for foreign currency deposits in the Philippines. But of course since we are talking about a foreign transient's dollar deposits the latter had been given more applicability.

HELD: 

The answer is NO.  (There you go... now I can write that justice had been at least rolling since the lower court's dispensation)  

Supreme Court said the "provisions of Section 113 of Central Bank Circular No. 960 and PD No. 1246, insofar as it amends Section 8 of Republic Act No. 6426, are hereby held to be INAPPLICABLE to this case because of its peculiar circumstances." 

The reason why it was peculiar was because the suspect, an American tourist escaped from jail and after “hearing the testimony of Karen, the Court BELIEVED that it was undoubtedly a shocking and traumatic experience”, which required compensation.

Let me quote what the SCRA said:

Supreme Court ruled that the questioned law makes futile the favorable judgment and award of damages that Salvacion and her parents fully deserve. It then proceeded to show that the economic basis for the enactment of RA No. 6426 is not anymore present; and even if it still exists, the questioned law still denies those entitled to due process of law for being unreasonable and oppressive. The intention of the law may be good when enacted. The law failed to anticipate the iniquitous effects producing outright injustice and inequality such as the case before us.

The SC adopted the comment of the Solicitor General who argued that the Offshore Banking System and the Foreign Currency Deposit System were designed to draw deposits from foreign lenders and investors and, subsequently, to give the latter protection. However, the foreign currency deposit made by a transient or a tourist is not the kind of deposit encouraged by PD Nos. 1034 and 1035 and given incentives and protection by said laws because such depositor stays only for a few days in the country and, therefore, will maintain his deposit in the bank only for a short time. Considering that Bartelli is just a tourist or a transient, he is not entitled to the protection of Section 113 of Central Bank Circular No. 960 and PD No. 1246 against attachment, garnishment or other court processes.Further, the SC said: “In fine, the application of the law depends on the extent of its justice. Eventually, if we rule that the questioned Section 113 of Central Bank Circular No. 960 which exempts from attachment, garnishment, or any other order or process of any court, legislative body, government agency or any administrative body whatsoever, is applicable to a foreign transient, injustice would result especially to a citizen aggrieved by a foreign guest like accused Greg Bartelli. This would negate Article 10 of the New Civil Code which provides that “in case of doubt in the interpretation or application of laws, it is presumed that the lawmaking body intended right and justice to prevail.”

"Respondents are hereby REQUIRED to COMPLY with the writ of execution issued in the civil case and to RELEASE to petitioners the dollar deposit of Bartelli in such amount as would satisfy the judgment."

___________________________________

Postscript:

I remember back in the Corona Impeachment days. They were deciding on whether to invoke the ruling in this case with regard to the applicability of the Foreign Currency Deposit Act with the then Chief Justice's supposed dollar accounts.   The senate majority leader A.P. Cayetano explained to Garcia that the impeachment court was invoking the SC ruling in the Salvacion case, which states that the secrecy of dollar deposits cannot be allowed to “impede the interest of justice.” Still, Garcia maintained that the depositor’s written consent is required. 

It would have been interesting to see how the Supreme Court would have handled it had it been the proper jurisdictional impeachment court. I mean you know, will it apply its ruling in this case with regard to the petition of Philippine Savings Bank to stop the Senate Impeachment Court from looking at the dollar accounts of CJ Corona? Like... will the Supreme Court find an exception to the Foreign Currency Deposit Act in the case of their Chief Justice? Woah.. intriguing.

Our rule books says, you know R.A. 6426's  emphasis is that the purpose of this law is to protect foreign investors and depositors and encourage the flow of foreign currency in the economy right? 

Now whether it will be used to shield a public official from any examination or investigation for charges of graft and corruption or ill-gotten wealth. That still remains to be seen. To be seen what?... well you know.. as they say... a culture of impunity is gradually reeking the highest court of the land. Well granted if the 'gods of olympus' have decided otherwise granted they were the jurisdictional impeachment court during that time, boy that would surely send a wrong signal to public officials and criminal elements. I mean you know... like "Well woop my ass, I'd rather put my money in a foreign deposit accounts since its beyond reach of 'any court, legislative body, government agency or any administrative body whatsoever' " right? bingo!! 'I've created a monster'.

I think the Supreme Court granted given jurisdiction to decide on the impeachment case, if it had to decide is bound to decide on the Corona Case the way it decided in this Salvacion Case notwithstanding the fact that the Chief Justice hasn’t been found guilty nor liable for any damages then yet right? 

Well, even PNoy in his meddling with the Corona Case conveniently forgot to mention that R.A. 6426 was held to be “inapplicable” to that case because of its “peculiar circumstances.”

And oh, what’s disturbing is when PNoy said that “The Palace was considering appealing the TRO on the basis that the Supreme Court may not interfere in impeachment proceedings.” Tsk tsk I remember the President’s men being reminded that he cannot interpret the law the way he wants to since the Supreme Court is the sole and final interpreter of the law right? Otherwise, he is just confirming to the public the allegations that he is the main instigator in the ousting of the former Chief Justice. Uh-oh.

Well, all's well ends well.

PLDT stockholder GAMBOA vs. Finance Secretary TEVES

I hope I don’t strike you as an Erudite, like a person who is learned. I AM NOT. Not even a Divergent. I'm a Dauntless. And I don't like long thinking. So I try to quickly grasp everything about anything in one sitting, and sadly mostly in an overview.  Even when I write I think it manifests it self a bit recklessly even though how much I wanted to hide it. And I'm not a writer perse. I’m just a blogger who writes at least good that’s all, and say what he feels to at least within a threshold of what is generally ethical. Anyone can do that.

And I’m not the nerdy type either, although I'm a geek most of the time co'z I'm a little bit techie and internet savvy, but I got my share of bad grades as well. I procrastinate relying on my push-comes-to-shove 'mutant' learning abilities, I only study during exams, and I’m an excellent crammer. Like it all ferociously crumple up inside my head in so short a time and sort of automatically downloads it self when I need it, only inevitably some in disarray.  I’m not the studious type even. Although I could read a book in one sitting, if the facts interests me. And it’s only just this year after so many years of having 20/20 vision that the doctors slid a pair of glasses on me and they never even were thick glasses but just take-off-in-a-normal-day reading glasses.  I'm far-sited.  So, don't feel intimidated okay? Who knows, we might be after all kindred spirits.

Truth is I should’ve taken the bar what 5 or 6 years ago? So in a bird's eye-view technically that would make me certified failure.  I should’ve been done with this sooner had I come to my senses earlier when I was a bit not older that this is really what I wanted.  And right now I feel like I’m slowly inching, dragging towards the finish line like a boring itchy worm. I hope I get there somehow, or at least. And who knows come to think of it, chances are you might be someone that's actually better than me, in so many ways than one when we actually get there. Oh do we digress? :) Sorry. Alright here it goes.

This is a CORPO case. Corpo meaning corporation. It is also somehow tackled in Transportation Law when it comes to discussing the foreign ownership issue of a public utility.  The law particularly invoked in this case is Sec. 11 of Art. 12 of the 1987 Constitution, which provides the limitation of foreign ownership of capital stocks to not more than 40%.

The exact provision states:

Section 11. No franchise, certificate, or any other form of authorization for the operation of a public utility shall be granted except to citizens of the Philippines or to corporations or associations organized under the laws of the Philippines, at least sixty per centum of whose capital is owned by such citizens;..  

So meaning.. adhering to this well settled principle, the remaining 40% may be foreign owned. This is ah... the bone of contention here is the word "CAPITAL" in this constitutional provision.

The action in this corporate drama started when above petitioner Wilson Gamboa, a Filipino  PLDT stockholder  filed a petition to nullify the sale of shares of stocks of PTIC, (that's  Philippine Telecommunications Investment Corporation) by the government, who effected the sale through IPC, (the Inter-Agency Privatization Council.) The transfer of the ownership of  the shares was done through a conditional sale via a public bidding. And the sale was awarded to MPAH, (Metro Pacific Assets Holdings, Inc.), an affiliate of First Pacific Company Limited (First Pacific), which is a Hong Kong-based investment management and holding company. In other words, were talking about a foreign company purchaser here.

Let me give you a rundown on the history of this case so you can understand it fully:

In (1928) : The Philippine legislature enacted Legislative Act No. 3436 which granted PLDT franchise and the right to engage in telecommunication business  alright? (grabe buhay na pala PLDT noon? pano sila nagcocommunicate?  dalawang lata na may tale?... oh well I guess its understandable, the brilliant dude Alex Graham Bell invented the telephone in around 1876? The invention must have probably evolved when it reached Philippine soil, although I just wonder if our predecessors were able to utilize the earliest model, the one that you stuck this thing in your ear and the other one in your mouth and say 'greetings!' Lol)

Alright, in (1969): GTE (not the VW GTE hybrid car ah) General Telephone Electronics, (the one that merged with Bell Atlantic. GTE is the parent company that spearheaded subsidiaries like Verizon and the Canadian company Telus? Yeah like the BPO outsourcing company.. you know that building you see across the Araneta Coliseum?) GTE is an American firm and during that time was one of the major PLDT stockholders. So what happened was it sold the 26% of its Outstanding Common Shares to PTIC. Outstanding Common Shares, meaning were talking about the whole shares of stocks of PLDT okay?. (Parang... kase the whole PLDT shares wasn't owned individually but severally like most of the stocks right? Like a conglomerate.) And the 26% OComS which was owned by the Americans was sold to a Filipino company which is PTIC,  (Philippine Telecommunications Investment Corporation,  which I think was majorly owned by the Cojuancos.)

Now in (1977): PHI (Prime Holdings Inc. ) was incorporated which I think was surreptitiously created since it subsequently became owner  of  111 thousand shares of PTIC by virtue of a Deed of Assignment executed by PTIC then stockholder Ramon Cojuanco. (I think this was during the time of Marcos when a lot of clandestine transfer of ownership were being effected, but of course the anti-Marcoses saw all that). 

So in (1986): after the EDSA Revolution. The PCGG was created and it sequestered this 111 Thousand shares which was later declared by court as government owned. The 111 Thousand shares by the way comprises 46% of the Outstanding Capital Stock of PTIC. OCapS meaning like were talking about Total Capital Shares of Stocks meaning may be owned within the individual shares of companies that comprised the PLDT stockholder companies. Gets? Now here comes the foreign company that started the issue entering the picture..

In (1999): First Pacific a Hong Kong based investment management and holding company acquired the remaining 54% Outstanding Capital Stocks of PTIC...  so were talking about OCapS here alright? as opposed to OComS. This acquisition simply means a foreign company had just bought himself in and became a player as one of the stockholders of PLDT through PTIC stocks. Crystal?

Now (2006): We now all know that 46% of OCapS of PTIC is now government owned right?  PCGG sequestered the assets remember?   Now, the government wanted to dispose these shares in order to privatize it, so through the IPC (Inter-Agency Privatization Council) it announced a public bidding where thereafter only 2 bidders submitted a bid.  Parallax Ventures and PAN ASIA.  Parallax won with a  bid of P25 Billion.

Now watch out here comes that foreign company First Pacific once again. As a PLDT stockholder and one of the stock players, it entered the picture once again eyeing that remaining 46%  PTIC shares... in other words foreign owned First Pacific wanted to own PTIC by 100% alright? So what it did was it announced that it will exercise its Right of First Refusal as a PTIC stockholder (it has a right because it owned the 54% PTIC shares of stocks remember?) and it offered to buy the remaining 46% by matching the bid price of Parallax.

But in (2007): First Pacific failed to do so and therefore not complying with the deadline. So it was opted out by the government seller.  But since the company was insistent First Pacific thru its subsidiary company MPAH entered into a conditional sale with the government and purchased the 46% for P25 Billion which resulted to an increase of First Pacific's stock ownership, rendering PTIC as wholly foreign owned. (Kaya pag magtatayo ka ng kompanya, magtayo ka ng subsidiary di ba? or affiliates through acquired assets.. to do the dirty work :))

Now this is primarily the reason for this petition. PLDT stock holder Wilson Gamboa saw all that and he now questions the sale between the government and MPAH (First Pacific) alleging that the sale resulted to an Indirect Sale which violated the 40% foreign capital ownership limitation of Sec. 11 of Art. 12 of the 1987 Constitutional provision.

Finance Secretary Margarito Teves who was the prime respondent in this case together with the then PCGG Commissioner Abcede defended the sale and alleged that First Pacific's intended acquisition of government's 111 Thousand PTIC shares resulting in 100% ownership of PTIC WILL NOT VIOLATE the 40% constitutional limit on foreign ownership   of public utility since PTIC holds only 13% of the total OUTSTANDING COMMON SHARES of PLDT. (OComS remember?)

ISSUE:

Whether the term CAPITAL in Sec. 11 Art. 12 of  Consti refer to the total common shares only, or to the total outstanding capital stocks of PLDT.

RULING:

The petition is PARTLY MERITORIOUS.

The Court said that it is not a trier of facts. That factual questions raised by petitioner are generally beyond the court jurisdiction. So adhering to this well settled principle. the court said it will confine its resolution solely on the threshold of purely legal matter on the interpretation of the term 'CAPITAL'. So it was a question of law after all. (After all the hoopla and bombardization of facts Lol.)

The Court partly granted the petition and held that the term “capital” in Sec. 11, Art. 12 of the Constitution refers only to shares of stock entitled to vote in the election of directors of a public utility, i.e., to the total common shares in PLDT.

Considering that common shares have voting rights which translate to control, as opposed to preferred shares which usually have no voting rights, the term “capital” in Sec. 11, Art. 12 of the Constitution refers only to common shares. 

However, if the preferred shares also have the right to vote in the election of directors, then the term “capital” shall include such preferred shares because the right to participate in the control or management of the corporation is exercised through the right to vote in the election of directors. In short, the term “capital” in Sec. 11, Art. 12 of the Constitution refers only to shares of stock that can vote in the election of directors.

CIR vs. PILIPINAS SHELL

SHELL seeks tax refunds... I mean tax credits.. does  BIR still gives tax rebates nowadays?  I bet due to scarcity of funds they merely resort to giving tax credits.

Well reason is because they sold petroleum products to an international carrier and they claimed that inasmuch as the law provides exemption from paying excise tax, then therefore they are entitled to a tax rebate.

Well we all know Shell right? their one of the top local oil companies in the country. Their into the manufacture, distribution and sale including export of petroleum products.

What Shell tried to do here is not Tax Evasion as all other big companies are understandably tempted to do so. What it tried doing here in this case is what you call 'Tax Avoidance'.

Well of course you're a top big oil company, it's  a given that you retain some of the best mercantile lawyers in the country.  So what do you do come the day of filing your business taxes? you call on your pool of lawyers to try think of a way to augment company expenses right?  And well of course since these men are all well versed in tax laws, then there's no harm in trying in circumventing some tax provisions right? And if caught in the act of doing? then you just have put up an innocent look, scratch your head and say "oh I didn't know that..tsk". E malay mo nga makalusot.  

So here they are Shell maintaining that since petroleum products sold to qualified international carriers are exempt from excise tax, as expressly stated in the tax code, then  no taxes should imposed on the article, to which goods the tax attaches, whether in the hand of the said international carriers or the petroleum manufacturer or producer. (Hmhm- pushing the envelope huh?)

But then the Commissioner of Internal Revenue on the other hand thought otherwise. Contending that Shell must shoulder the excise taxes it previously paid on petroleum products which it later sold to international carriers.

Meaning it cannot  pass on the tax burden to the said international carriers which have been granted exemption under Sec. 135 of the NIRC.

Okay what does Sec. 135 of the 1997 NIRC has to say?

SEC. 135. Petroleum Products Sold to International Carriers and Exempt Entities or Agencies. - Petroleum products sold to the following are exempt from excise tax: (a) International carriers of Philippine or foreign registry on their use or consumption outside the Philippines: Provided, That the petroleum products sold to these international carriers shall be stored in a bonded storage tank and may be disposed of only in accordance with the rules and regulations to be prescribed by the Secretary of Finance, upon recommendation of the Commissioner; (b) Exempt entities or agencies covered by tax treaties, conventions and other international agreements for their use or consumption: Provided, however, That the country of said foreign international carrier or exempt entities or agencies exempts from similar taxes petroleum products sold to Philippine carriers, entities or agencies; and (c) Entities which are by law exempt from direct and indirect taxes.

So what happened? Had Shell really understood it differently?  

ISSUE:

1. WON Shell can pass on to international carriers and exempt agencies the excise taxes it paid as manufacturer or producer.

2. WON Shell has a right to file a claim for refund or tax credit for the excise taxes it paid or the petroleum products it sold to international carriers.

HELD:

1. SHELL CANNOT PASS ON THE EXCISE TAXES

Court says: An excise tax is a tax on the manufacturer not on the purchaser.  Hence Shell as engaged in the business of processing petroleum products is the one liable for the excise taxes.

There being no express grant under NIRC of exemption of payment of excise tax  to local manufacturers of petroleum products sold international carriers and absent any provision in the Code authorizing the refund of excise tax paid, the Court holds that Sec. 135 should be construed as prohibiting the shifting of the burden of the excise tax to the international carriers who buys petroleum products from the local manufacturers. 

2. SHELL HAS NO RIGHT TO CLAIM FOR TAX REFUND

Founded on the principles of international comity  and reciprocity. PD 1359 granted exemption from payment of excise tax but only to foreign international carriers who are allowed to purchase petroleum products free of  specific tax provided the country of said carrier also grants tax exemption to Philippine carriers.

So what is PD 1359?  This was a Marcos Decree that amended a previous tax code, the Sec. 134 of the 1977 NIRC.  The exact provision states:

"HOWEVER, PETROLEUM PRODUCTS SOLD TO AN INTERNATIONAL CARRIER FOR ITS USE OR CONSUMPTION OUTSIDE OF THE PHILIPPINES SHALL NOT BE SUBJECT TO SPECIFIC TAX, PROVIDED, THAT THE COUNTRY OF SAID CARRIER EXEMPTS FROM TAX PETROLEUM PRODUCTS SOLD TO PHILIPPINE CARRIERS."

I think the old law  Sec. 134 of the 1977 NIRC did not extend tax exemption to international carriers before. So Marcos did spearheaded the tax exemption, that is now contemplated in the current law governing sale of petroleum products outside the country.

Geez... I bet Shell must have been dissing that Marcos amendment up to now.  

In continuation, the Supreme Court further stated that both the earlier amendment in the 1977 Tax Code and the present Sec. 135 of the 1997 NIRC did not exempt the oil companies from the payment of excise tax on petroleum products manufactured and sold by them  to international carriers.

Therefore claims for tax refund or credit filed by Shell is denied for lack of basis.

So Shell top retainer lawyers loses this case. I bet they knew it all along. E malay mo nga naman talaga baka makalusot.  The case is dated 2012... makakalusot ka pa ba kay Commissioner Kim Henares?  Try mo lang ;p

ALVAREZ vs IAC (YANES)

I remember back in freshmen law, may maid kame si Manang Carmen, grabe sobrang magugugulaten & mali-mali. Eh pag nag mememorize ako palakadlakad ako sa buong bahay. Kaso napapadaan ako sa kusina naaamoy ko niluluto nya ang sarap. Pero iniimagine ko nasa korte ako, ako yung abogadong nagcocrossexamine ng adverse party's witness or yung accused. Tipong court room drama ba. Tinuturo ko para umamin. Kaso si Manang Carmen nandon, eh kelangan ko ng props kaya sya kunyare yung witness. "..accused did then & there.." lalagpasan ko kunyare tas biglang tatalikod ako "WILLFULLY!!" (Ay Kabayo!!) "UNLAWFULLY!!!" (Esusmariosep!!!) "& FELONEOUSLY!!!" (Ay pelonyusly kang bata ka.. AAAAAAAYYY!!!!! YAWA PISTING BATA KA) Ahahaha.. hahabulin ako nun... hangang garden up to the gate lakas talaga ng tawa ko. Pagmangungurot yon sobrang lake LOL. San na kaya si Manang Carmen ngayon, I hope everything's well with her.

Alright we digressed. Here's another Succession case. Brace your selves, this is a roller coaster ride.

Two parcels of land were registered in the names of Ancieto Yanes, father of herein respondents alright? Were talking about an Original Certificate of Title alright (OCT)? Now for some reason a certain Fortunato Santiago was issued a Transfer Certificate of Tittle (TCT), meaning there was a transfer of ownership, in what mode? most probably a sale.  Santiago then sold the lots to Monico Fuentebella. Then the lots were sold thereafter to Rosendo Alvarez.  So three TCTs in one sitting  everyone seemed to be itching to quickly dispose it, the first transfer of ownership must be a falsificated sale.  So person A is the original owner, person B got a hold of the title to his property, sold it to person C, who in turn sold it to person D. Oh but wait there's more. There's a person E. And he's coming, wait for it. 

So the Yaneses filed a complaint against the three. Santiago, Fuentebella and Alvarez and wait.. there's one more, the 4th person imputed in his filed case, only its not a person perse, its a juridical person. The Register of Deeds of Negros Occidental, which must have been the source of all the falsification. Yanes petitioned the return and owndership of the lots and prayed for an accounting of the produce of the land from 1944 up to the filing of the complaint with damages. 

Enter person E. Take note. Now during the pendency of the case, Alvarez offered the lots to Dr. Rodolfo Siason. Now Dr. Siason unsuspecting and unaware of the previous dubitable contracts and the pending case bought the lots. 

Comes out the decision, The CFI (Court of First Instance) (This is an old case that's how they call their RTC then.) ordered Alvarez to reconvey and deliver the possession of the lots to Yanes.  Here comes the controversy. The court order proved to be inexecutable with respect to the one lot since it had been subdivided into two, and they were in the name of the doctor who purchased them in good faith from Alvarez, and that the lot could not be delivered back to the plaintiff since Dr. Siason was not a party in the writ of execution. 

So the Yaneses filed a petition for the issuance of a new certificate of title and for the declaration of nullity of the TCTs issued to Alvarez.  But the lower court found Siason as a buyer in good faith. Tsk tsk.. it could have stopped in Alvarez you know, the reconveyance would not have seemed to be a problem you know, but the court saw a 3rd party liability in here in the person of Siason, and the court just had to protect that, gets?  

Meanwhile in the middle of all these Rosendo Alvarez died. He probably couldn't take it anymore. Hahaha.. don't quote me on that. And so the court ordered the heirs of Alvarez to pay the Yaneses the actual value of the lots, plus damages. The IAC, meaning Intermediate Appellate Court  (Their CA during their time) affirmed the CFI decision except with regard to the damages.  Heirs of Alvarez contends the liability arising from the sale of the lots made by their father to Dr. Siason should be the sole liability of the late Rosendo Alvarez or of his estate after his death. 

ISSUE:

WON the Heirs of Alvarez' contention that the liability arising from the sale of the lots made to Dr. Siason should be the sole liability of the late Rosendo Alvarez or of his estate after his death.

RULING:

  

NO. - Under our law, the general rule is that a party's contractual rights and obligations are transmissible to the successors.  The pertinent provisions of the Civil Code state:

Art. 774.

Succession is a mode of acquisition by virtue of which the property, rights and obligations to the extent of the value of the inheritance, of a person are transmitted through his death to another or others either by his will or by operation of law.

Art. 776.

The inheritance includes all the property, rights and obligations of a person which are not extinguished by his death.

Art. 1311

Contracts take effect only between the parties, their assigns and heirs except in case where the rights and obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of law. The heir is not liable beyond the value of the property received from the decedent.

In the Estate of Hemady vs. Luzon Surety Case, the court ruled that:

The binding effect of contracts upon the heirs of the deceased party is not altered by the provision of our Rules of Court that money debts of a deceased must be liquidated and paid from his estate before the residue is distributed among said heirs (Rule 89).  The reason is that whatever payment made from the state is ultimately a payment by the heirs, since the amount of the paid claim in fact diminishes or reduces the shares that the heirs would have been entitled to receive.

Petitioners being the heirs of the late Rosendo Alvarez, they cannot escape the legal consequences of their father's transaction, which gave rise to the present claim for damages. 

That petitioners did not inherit the property involved is of no moment because by legal fiction, the monetary equivalent thereof devolved into the mass of their father's hereditary estate, and hereditary assets are always liable in their totality for the payment of the debts of the estate. 

It must, however, be made clear that petitioners are liable only to the extent of the value of their inheritance.

Heirs of Alvarez loses this case.