June-27-2018-cases-statutory-construction.docx

G.R. No. 78687 January 31, 1989 ELENA SALENILLAS AND BERNARDINO SALENILLAS, petitioners, vs. HONORABLE COURT OF APPEALS and HONORABLE RAYMUNDO SEVA, JUDGE OF BRANCH 38 OF THE REGIONAL TRIAL COURT OF CAMARINES NORTE and WILLIAM GUERRA, respondents. Jose L. Lapak for petitioners. Jose T. Atienza for private respondent.

SARMIENTO, J.: This petition for review on certiorari which seeks the reversal and setting aside of the decision 1 of the Court of Appeals 2 dismissing the petition for certiorari against Judge Raymundo Seva of the Regional Trial Court of Camarines Norte and the private respondent, William Guerra, involves a pure question of law i.e., the coverage and application of Section 119 of Commonwealth Act No. 141, as amended, known otherwise as the Public Land Act. The facts are undisputed. The property subject matter of the case was formerly covered by Original Certificate of Title No. P-1248, issued by virtue of Free Patent Application No. 192765, in favor of the spouses, Florencia H. de Enciso and Miguel Enciso. The said original certificate of title was inscribed in the Registration Book for the Province of Camarines Norte on December 10, 1961. On February 28, 1970, the patentees, the Enciso spouses, by an Absolute Deed of Sale, sold the property in favor of the petitioners, the spouses Elena Salenillas and Bernardino Salenillas for a consideration of P900.00. Petitioner Elena Salenillas is a daughter of the Encisos. As a result of the aforementioned sale, Transfer Certificate of Title No. T-8104 of the Register of Deeds of Camarines Norte was issued in the name of the Salenillas, cancelling Original Certificate of Title No. P-1248. On June 30, 1971, the petitioners mortgaged the property now covered by T.C.T. No. T-8104 with the Rural Bank of Daet, Inc. The mortgage was subsequently released on

November 22, 1973 after the petitioners paid the amount of P1,000.00. Later, or on December 4, 1975, the petitioners again mortgaged the property, this time in favor of the Philippine National Bank Branch, Daet, Camarines Norte as security for a loan of P2,500.00. For failure of the petitioners to pay their loan, extrajudicial foreclosure proceeding, pursuant to Act No. 3135, was instituted by the Philippine National Bank against the mortgage and the property was sold at a public auction held on February 27, 1981. The private respondent, William Guerra, emerged as the highest bidder in the said public auction and as a result thereof a "Certificate of Sale" was issued to him by the Ex Officio Provincial Sheriff of Camarines Norte. Ultimately, on July 12, 1983, a "Sheriff's Final Deed" was executed in favor of the private respondent. On August 17,1983, the Philippine National Bank filed with the Regional Trial Court of Camarines Norte at Daet, a motion for a writ of possession. The public respondent, Judge Raymundo Seva of the trial court, acting on the motion, issued on September 22, 1983 an order for the issuance of a writ of possession in favor of the private respondent. When the deputy sheriff of Camarines Norte however, attempted on November 17, 1983, to place the property in the possession of the private respondent, the petitioners refused to vacate and surrender the possession of the same and instead offered to repurchase it under Section 119 of the Public Land Act. On August 15, 1984, another motion, this time for the issuance of an alias writ of possession was filed by the private respondent with the trial court. The petitioners, on August 31, 1984, opposed the private respondents' motion and instead made a formal offer to repurchase the property. Notwithstanding the petitioners' opposition and formal offer, the trial court judge on October 12, 1984 issued the alias writ of possession prayed for the private respondent. The petitioners moved for a reconsideration of the order but their motion was denied. Undeterred by their initial setback, the petitioners elevated the case to the respondent Court of

Appeals by way of a petition for certiorari claiming that the respondent trial court judge acted with grave abuse of discretion in issuing the order dated October 12, 1984 granting the writ of possession, and the order dated October 22, 1984, denying their motion for reconsider consideration. In a resolution dated January 23, 1985, the respondent appellate court gave due course to the petition; required the parties to submit simultaneous memoranda in support to their respective positions; and restrained the trial court and the private respondent from executing, implementing or otherwise giving effect to the assailed writ of possession until further orders from the court. 3 However, in a decision promulgated on September 17, 1986, the respondent Court of Appeals dismissed the case for lack of merit. According to the appellate court: It must be noted that when the original owner, Florencia H. Enciso whose title, OCT No. P-1248, was issued on August 9, 1961, executed a deed of absolute sale on February 28, 1970 of the property covered by said title to spouses Elena Salenillas and Bernardino Salenillas, the five year period to repurchase the property provided for in Section 119 of Commonwealth Act No. 141 as amended could have already started. Prom this fact alone, the petition should have been dismissed. However, granting that the transfer from parent to child for a nominal sum may not be the "conveyance" contemplated by the law. We will rule on the issue raised by the petitioners. 4 xxx xxx xxx Applying the case of Monge, et al. vs. Angeles, et al., 5 the appellate court went on to hold that the five-year period of the petitioners to repurchase under Section 119 of the Public Land Act had already prescribed. The point of reckoning, ruled the respondent court in consonance with Monge is from the date the petitioners mortgaged the property on December 4, 1973. Thus, when the petitioners made their formal offer to repurchase on August 31, 1984, the period had clearly expired. In an effort to still overturn the decision, the petitioners moved for reconsideration. Their motion

apparently went for naught because on May 7, 1987, the respondent appellate court resolved to deny the same. Hence, this petition. Before us, the petitioners maintain that contrary to the rulings of the courts below, their right to repurchase within five years under Section 119 of the Public Land Act has not yet prescribed. To support their contention, the petitioners cite the cases of Paras vs. Court of Appeals 6 and Manuel vs. Philippine National Bank, et al. 7 On the other side, the private respondent, in support of the appellate court's decision, states that the sale of the contested property by the patentees to the petitioners disqualified the latter from being legal heirs vis-a-vis the said property. As such, they (the petitioners) no longer enjoy the right granted to heirs under the provisions of Section 119 of the Public Land Act. 8 In fine, what need be determined and resolved here are: whether or not the petitioners have the right to repurchase the contested property under Section 119 of the Public Land Act; and assuming the answer to the question is in the affirmative, whether or not their right to repurchase had already prescribed. We rule for the petitioners. They are granted by the law the right to repurchase their property and their right to do so subsists. Section 119 of the Public Land Act, as amended, provides in full: Sec. 119. Every conveyance of land acquired under the free patent or homestead provisions, when proper, shall be subject to repurchase by the applicant, his widow, or legal heirs within a period of five years from the date of the conveyance. From the foregoing legal provision, it is explicit that only three classes of persons are bestowed the right to repurchase — the applicant-patentee, his widow, or other legal heirs. Consequently, the contention of the private respondent sustained by the respondent appellate court that the petitioners do not belong to any of those classes of repurchasers because they acquired the property not through inheritance but by sale, has no legal basis. The petitioners-spouses are the daughter and son-in-law of the Encisos,

patentees of the contested property. At the very least, petitioner Elena Salenillas, being a child of the Encisos, is a "legal heir" of the latter. As such, and even on this score alone, she may therefore validly repurchase. This must be so because Section 119 of the Public Land Act, in speaking of "legal heirs," makes no distinction. Ubi lex non distinguit nec nos distinguere debemos. Moreover, to indorse the distinction made by the private respondent and the appellate court would be to contravene the very purpose of Section 119 of the Public Land Act which is to give the homesteader or patentee every chance to preserve for himself and his family the land that the State had gratuitously given him as a reward for his labor in clearing and cultivating it. 9 Considering that petitioner Salenillas is a daughter of the spouses Florencia H. Enciso and Miguel Enciso, there is no gainsaying that allowing her (Elena) and her husband to repurchase the property would be more in keeping with the spirit of the law. We have time and again said that between two statutory interpretations, that which better serves the purpose of the law should prevail. Guided by the same purpose of the law, and proceeding to the other issue here raised, we rule that the five-year period for the petitioners to repurchase their property had not yet prescribed. The case of Monge et al. vs. Angeles, et al., 10 cited as authority by the respondent Court of Appeals is inapplicable to the present controversy. The facts obtaining there are substantially different from those in this case. In Monge the conveyance involved was a pacto de retro sale and not a foreclosure sale. More importantly, the question raised there was whether the five-year period provided for in Section 119 "should be counted from the date of the sale even if the same is with an option to repurchase or from the date the ownership of the land has become consolidated in favor of the purchaser because of the homesteader's failure to redeem it. 11 It is therefore understandable why the Court ruled there as it did. A sale on pacto de retro immediately vests title, ownership, and, generally possession over the property on the vendee a retro, subject only to the right of the

vendor a retro to repurchase within the stipulated period. It is an absolute sale with a resolutory condition. The cases 12 pointed to by the petitioner in support of their position, on the other hand, present facts that are quite identical to those in the case at bar. Both cases involved properties the titles over which were obtained either through homestead or free patent. These properties were mortgaged to a bank as collateral for loans, and, upon failure of the owners to pay their indebtedness, the mortgages were foreclosed. In both instances, the Court ruled that the five-year period to. repurchase a homestead sold at public auction or foreclosure sale under Act 3135 begins on the day after the expiration of the period of redemption when the deed of absolute sale is executed thereby formally transferring the property to the purchaser, and not otherwise. Taking into account that the mortgage was foreclosed and the mortgaged property sold at a public auction to the private respondent on February 27, 1981, with the "Sheriff's Final Deed" issued on July 12, 1983, the two offers of the petitioners to repurchase the first on November 17, 1983, and the second, formally, on August 31, 1984 were both made within the prescribed five-year period. Now, as regards the redemption price, applying Sec. 30 of Rule 39 of the Revised Rules of Court, the petitioners should reimburse the private respondent the amount of the purchase price at the public auction plus interest at the rate of one per centum per month up to November 17, 1983, together with the amounts of assessments and taxes on the property that the private respondent might have paid after purchase and interest on the last named amount at the same rate as that on the purchase price. 13 WHEREFORE, the petition is GRANTED. The Decision dated September 17, 1986, and the Resolution dated May 7, 1987 of the Court of Appeals, and the Orders dated September 22, 1983, October 12, 1984, and October 22, 1984 of the Regional Trial Court of Daet, Camarines Norte, are hereby REVERSED and SET ASIDE, and another one ENTERED directing the private respondent to reconvey the subject property and to execute the

corresponding deed of reconveyance therefor in favor of the petitioners upon the return to him by the latter of the purchase price and the amounts, if any, of assessments or taxes he paid plus interest of one (1%) per centum per month on both amounts up to November 17, 1983. No costs. SO ORDERED. G.R. No. 118746 September 7, 1995 ATTY. WILFREDO TAGANAS, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, MELCHOR ESCULTURA, ET AL., respondents. RESOLUTION FRANCISCO, J.: Petitioner Atty. Wilfredo E. Taganas represented herein private respondents in a labor suit for illegal dismissal, underpayment and non-payment of wages, thirteenth-month pay, attorney's fees and damages conditioned upon a contingent fee arrangement granting the equivalent of fifty percent of the judgment award plus three hundred pesos appearance fee per hearing.1 The Labor Arbiter ruled in favor of private respondents and ordered Ultra Clean Services (Ultra) and the Philippine Tuberculosis Society, Inc., (PTSI) respondents therein, jointly and severally to reinstate herein private respondents with full backwages, to pay wage differentials, emergency cost of living allowance, thirteenth-month pay and attorney's fee, but disallowed the claim for damages for lack of basis.2 This decision was appealed by Ultra and PTSI to the National Labor Relations Commission (NLRC), and subsequently by PTSI to the Court but to no avail. During the execution stage of the decision, petitioner moved to enforce his attorney's charging lien.3 Private respondents, aggrieved for receiving a reduced award due to the attorney's charging lien, contested the validity of the contingent fee arrangement they have with petitioner, albeit four of the fourteen private respondents have expressed their conformity thereto.4

Finding the arrangement excessive, the Labor Arbiter ordered the reduction of petitioner's contingent fee from fifty percent of the judgment award to ten percent, except for the four private respondents who earlier expressed their conformity.5 Petitioner appealed to NLRC which affirmed with modification the Labor Arbiter's order by ruling that the ten percent contingent fee should apply also to the four respondents even if they earlier agreed to pay a higher percentage.6 Petitioner's motion for reconsideration was denied, hence this petition for certiorari. The sole issue in this petition is whether or not the reduction of petitioner's contingent fee is warranted. Petitioner argues that respondent NLRC failed to apply the pertinent laws and jurisprudence on the factors to be considered in determining whether or not the stipulated amount of petitioner's contingent fee is fair and reasonable. Moreover, he contends that the invalidation of the contingent fee agreement between petitioner and his clients was without any legal justification especially with respect to the four clients who manifested their conformity thereto. We are not persuaded. A contingent fee arrangement is an agreement laid down in an express contract between a lawyer and a client in which the lawyer's professional fee, usually a fixed percentage of what may be recovered in the action is made to depend upon the success of the litigation.7 This arrangement is valid in this jurisdiction.8 It is, however, under the supervision and scrutiny of the court to protect clients from unjust charges.9 Section 13 of the Canons of Professional Ethics states that "[a] contract for a contingent fee, where sanctioned by law, should be reasonable under all the circumstances of the case including the risk and uncertainty of the compensation, but should always be subject to the supervision of a court, as to its reasonableness". Likewise, Rule 138, Section 24 of the Rules of Court provides: Sec. 24. Compensation of attorneys; agreement as to fees. — An attorney shall be entitled to have and recover from his client no more than a reasonable compensation for his services, with a view to the importance of the subject-matter of the controversy,

the extent of the services rendered, and the professional standing of the attorney. No court shall be bound by the opinion of attorneys as expert witnesses as to the proper compensation but may disregard such testimony and base its conclusion on its own professional knowledge. A written contract for services shall control the amount to be paid therefor unless found by the court to be unconscionable or unreasonable. When it comes, therefore, to the validity of contingent fees, in large measure it depends on the reasonableness of the stipulated fees under the circumstances of each case. The reduction of unreasonable attorney's fees is within the regulatory powers of the courts.10 We agree with the NLRC's assessment that fifty percent of the judgment award as attorney's fees is excessive and unreasonable. The financial capacity and economic status of the client have to be taken into account in fixing the reasonableness of the fee.11 Noting that petitioner's clients were lowly janitors who receive miniscule salaries and that they were precisely represented by petitioner in the labor dispute for reinstatement and claim for backwages, wage differentials, emergency cost of living allowance, thirteenth-month pay and attorney's fees to acquire what they have not been receiving under the law and to alleviate their living condition, the reduction of petitioner's contingent fee is proper. Labor cases, it should be stressed, call for compassionate justice.

contract did not make the agreement valid. The contingent fee contract being unreasonable and unconscionable the same was correctly disallowed by public respondent NLRC even with respect to the four private respondents who agreed to pay higher percentage. Petitioner is reminded that as a lawyer he is primarily an officer of the court charged with the duty of assisting the court in administering impartial justice between the parties. When he takes his oath, he submits himself to the authority of the court and subjects his professional fees to judicial control.13 WHEREFORE, finding no grave abuse of discretion the assailed NLRC decision is hereby affirmed in toto. G.R. No. L-36897 June 26, 1980 SPOUSES FLORENTINO S. TOMAS and FRANCISCA CARIÑO, plaintiffs-appellees, vs. EUSEBIA TOMAS, defendant, PHILIPPINE NATIONAL BANK, SANTIAGO, ISABELA BRANCH, defendant-appellant.

DE CASTRO, J.:

Furthermore, petitioner's contingent fee falls within the purview of Article 111 of the Labor Code. This article fixes the limit on the amount of attorney's fees which a lawyer, like petitioner, may recover in any judicial or administrative proceedings since the labor suit where he represented private respondents asked for the claim and recovery of wages. In fact, We are not even precluded from fixing a lower amount than the ten percent ceiling prescribed by the article when circumstances warrant it.12 Nonetheless, considering the circumstances and the able handling of the case, petitioner's fee need not be further reduced.

Plaintiff spouses, Florentino S. Tomas and Francisca Cariño, are the owners of a parcel of land located in Malasian, Santiago, Isabela (now Saguday, Nueva Vizcaya) since 1929, which they obtained through a homestead patent with Original Certificate of Title No. I-4620. Through fraud and misrepresentation, one Eusebia Tomas succeeded in having OCT No. I-4620 cancelled, and obtained in her name TCT No. 8779, Isabela now TCT-350 Nueva Vizcaya, with which she obsessed a loan from the Philippine National Bank branch in Santiago, Isabela, as a security, mortgaging the land with the bank for the load of P2,500.00. Florentino Tomas discovered the fraudulent acts of Eusebia Tomas when he himself applied for a loan from the Philippine National Bank, and offered as a collateral the same land already mortgaged by Eusebia Tomas to the bank.

The manifestation of petitioner's four clients indicating their conformity with the contingent fee

In the action plaintiffs filed on April 14, 1964 to declare TCT-350, Nueva Vizcaya, null and void,

against Eusebia Tomas, it was found by the court (Court of First Instance of Nueva Vizcaya) that Eusebia Tomas succeeded in having plaintiffs' OCT No. I-4620 (Isabela)1 cancelled and having TCT No. 8779 (Isabela) 2 issued in her name, by executing a deed of extra-judicial settlement 3 in which she made it appear that she is the lone heir of the registered owner, Florentino Tomas, to whom she was not even known before, and who was at the time very much alive. She then petitioned for the issuance of another owner's duplicate of OCT No. I4620, alleging loss of said owner's duplicate. On Order of the court (Court of First Instance of Isabela) where the petition was filed, a new owner's duplicate was issued to Eusebia Tomas as the petitioner. Upon the registration of the deed of extra-judicial settlement (Exhibit "J" OCT No. I4620 was cancelled, and TCT No. 8779, now TCT350 Nueva Vizcaya was issued in the name of Eusebia Tomas on March 14,1957. In the same action, the Philippine National Bank was made a co-defendant as the mortgagee of the land, the plaintiffs alleging that the mortgage is null and void, the mortgagor not being the owner of the property mortgaged. After trial in which Eusebia Tomas never appeared to present any evidence, the court a quo rendered judgment dated June 9, 1967, the dispositive portion 4 of which reads: IN VIEW OF ALL THE FOREGOING CONSIDERATIONS, decision is hereby rendered in favor of the plaintiffs and against the defendants: (a) declaring transfer Certificate of Title No. T8779, now Transfer Certificate of Title No. T-350 in the name of defendant Eusebia Tomas null and void; (b) declaring the deed of extra-judicial settlement executed by defendant Eusebia Tomas null and void, (c) declaring Original Certificate of Title No. I-4620 and its file and owner's copy revived (d) condemning defendant Eusebia Tomas to pay the plaintiffs in the amount of P950.00 as attorney's fee and P 55.80 representing the actual expenses of the plaintiffs; (e) declaring the mortgage in favor of the Philippine National Bank without force and effect against the plaintiffs, and ordering defendant Eusebia Tomas to pay the costs of this proceedings.

From the portion of the foregoing judgment declaring the mortgage, in its favor without force and effect, the Philippine National Bank appealed to the Court of Appeals, 5 which, however, certified the appeal to this Court, this issue presented being purely legal. 6 The only issue to be resolved is whether the mortgage of the land in favor of the appellant bank is valid or not as against appellees. There is no dispute that the mortgagor Eusebia Tomas is not the owner of the land in question, the true owner being the appellees, who had always been in possession of said land since they applied for it by way of homestead patent. The owner's duplicate of OCT No. I-4620 covering the land in favor of appellee Florentino Tomas had always been with the latter, and was never lost as falsely and fraudulently misrepresented by Eusebia Tomas in her petition for a new owner's duplicate of OCT No. I-4620. Alleging however, good faith so as to invoke the protective provision of the Land Registration Act (Section 39, Act 496), pointing to the fact that the certificate of title, TCT-350 Nueva Vizcaya presented by Eusebia Tomas as mortgagor was in her name, and showed no encumbrance over the land, the appellant bank contends that its right as mortgagee must be fully rated as a mortgagee in good faith. Verily, the resolution of the issue raised in this appeal hinges on whether the appellant is a mortgagee in good faith and for value, for if it is, and without anything to excite suspension as it claims, it is protected in the same way as a purchaser in good faith and for value is protected under Section 39 of Act 496, otherwise known as the Land Registration Act. In claiming good faith as a mortgagee, and for value, appellant bank claims that no proof to the contrary was presented by appellees in the trial court. 7 It is a fact, however, that incontrovertible proofs have seen adduced showing that Eusebia Tomas, the mortgagor, was not the owner of the property mortgaged. This is an that appellees had to prove that would place appellant bank on obligation to show good faith, as in fact, it was the bank that alleged good faith as its defense. 8 It would be more

legally correct, therefore, to say that it was incumbent on appellant to prove its affirmative allegation of good faith rather than appellee to show the contrary. In any case, to the statement in appellees' brief that appellant bank "did not object when appellees presented evidence in the lower court regarding negligence of appellant, like their failure to send field inspector to the land to discover who is the real owner of the land being offered as Atty. to the loan of impostor Eusebia Tomas," no denial was made in a reply brief which appellant should have filed if it wanted to deny this assertion of appellees. The allegation that appellate presented no proof of lack of good faith on the part of appellant bank may, therefore, not altogether be accurate. The facts as properly taken note of by the lower court would seem to bring the instant case within the ruling of the case of Pichay vs. Celestino, 9 the essence of which is as between two innocent persons, the mortgagee and the owner of the mortgaged property, one of whom must suffer the consequence of a breach of trust, the one who made it possible by his act of confidence must bear the loss. This is a principle that accords more with justice and equity, in the light of the common practice of banking institution, which is a matter of public knowledge, as observed by the trial court in the case aforecited, with which this Court agreed, before approving a loan, to send representatives to the premises of the land offered as collateral and investigate who are the true owners thereof. Incidentally, the ruling cited herein was against the same appellant bank, the Philippine National Bank, with reference to a mortgage entered into under solar circumstances. Banks, indeed, should exercise more care and prudence in dealing even with registered lands, than private individuals, for their business is one affected with public interest, keeping in trust money belonging to their depositors, which they should guard against loss by not committing any act of negligence which amount to lack of good faith by which they would be denied the protective mantle of the land registration statute, Act 496, extended only to purchasers for value and in good faith, as well as to mortgagees of the same character and description. This is evidently the

rationale of the doctrine laid down in the case of Pichay vs. Celestino, supra, which as in the instant suit, involved also a mortgage of a land covered by a certificate of title, mortgaged by the defendant who was not the owner. The latter, however, succeeded in cancelling the original certificate of title in the name of the real owner, by forging a deed of sale, purportedly executed by the said registered owner in his favor, upon the registration of which, he obtained a transfer certificate of title in his name, presenting a new owner's duplicate certificate he obtained by falsely alleging that the first owner's duplicate was burned in an exparte petition with prayer for the issuance of another owner's duplicate which the court granted. Thus, the facts of the instant case so closely resemble, if they are not exactly the same as, those in the Pichay vs. Celestino case, as to make the application of the ruling in said case to the one at bar unavoidable and compelling. There were only 12 days between the cancellation of OCT No. I4620 on March 14, 1957 and the constitution of the mortgage on March 26, 1957, which shows that the application for the loan must have been filed within days only from the receipt of the new TCT No. 8779 by Eusebia Tomas. This fact should have aroused suspicion for appellant bank to send representative to the premises to ascertain who the true owner is, considering that homestead patents are generally applied for by male appellant applicants, and are very infrequently sold or alienated, the policy of the law being against sale or alienation. The decision of this Court in the aforecited case promulgated on May 30, 1967 preceded the decision of the lower court in this case dated June 7, 1967, by only a few days. However, the court a quo went along the doctrine as laid down in the Pichay vs. Celestino case even perhaps without having actually read the decision, although a similar rule had earlier been laid down in Blondeau, et al. vs. Nano, et al. 10 We, therefore, find no error in the holding of the court a quo that the mortgage executed by Eusebia Tomas, appellant's codefendant in favor of said appellant bank over the land in question which the former never owned, is without effect as against appellees herein.

We, indeed, find more weight and vigor in a doctrine which recognizes a better right for the innocent original registered owner who obtained his certificate of title through perfectly legal and regular proceedings, than one who obtains his certificate from a totally void one, as to prevail over judicial pronouncements to the effect that one dealing with a registered land, such as a purchaser, is under no obligation to look beyond the certificate of title of the vendor, for in the latter case, good faith has yet to be established by the vendee or transferee, being the most essential condition, coupled with valuable consideration, to entitle him to respect for his newly acquired title even as against the holder of an earlier and perfectly valid title. There might be circumstances apparent on the face of the certificate of title which could excite suspicion as to prompt inquiry, such as when the transfer is not by virtue of a voluntary act of the original registered owner, as in the instant case, where it was by means of a self-executed deed of extra-judicial settlement, a fact which should be noted on the face of Eusebia Tomas' certificate of title. Failing to make such inquiry would hardly be consistent with any pretense of good faith, which the appellant bank invokes to claim the right to be protected as a mortgagee, and for the reversal of the judgment rendered against it by the lower court. WHEREFORE, the judgement appealed from is hereby affirmed, without pronouncement to cost. SO ORDERED. G.R. No. L-30375 September 12, 1978 JOSE ESCRIBANO, petitioner, vs. HON. DAVID P. AVILA, as Presiding Judge of the Court of First Instance of Cotabato (First Branch) and SALIPADA K. PENDATUN, respondents. Jose W. Diokno for petitioner. M. C. Sicat for private respondent.

AQUINO, J.:

This case is about the jurisdiction of the Court of First Instance to conduct the preliminary investigation of a complaint for written defamation. On September 25, 1968 Congressman Salipada K. Pendatun, the governor-elect of Cotabato, filed directly with the Court of First Instance of that province (now North Cotabato) a complaint for libel against Mayor Jose Escribano of Tacurong, Cotabato (now the province of Sultan Kudarat). The complaint was subscribed and sworn to before respondent Judge David P. Avila. It was supported by the affidavit of Acting Governor Simeon Datumanong. In that complaint Escribano was charged with having said in a speech, which was broadcasted on August 26, 1968 by a radio station at Cotabato City, that "Mr. Pendatun is the worst animal that ever live (fixed) in this province" criminal Case No. 5283). Escribano questioned Judge Avila's authority to conduct the preliminary investigation of the offense. Judge Avila in his orders of March 5, 20 and 27, 1969 ruled that he had the power to conduct the preliminary investigation. He received complainant's evidence. On April 1, 1969 Escribano filed in this Court against Judge Avila and Pendatun the instant special civil actions of certiorari and prohibition, praying that the said orders of Judge Avila be set aside. The respondents were required to answer the petition. No restraining order was issued. On April 18 Escribano filed a supplemental petition to annul Judge Avila's order of March 29, 1969. In that order he found that Pendatun's evidence had "established a probable cause to believe that" libel by radio had been committed and that Escribano "probably committed the same". Judge Avila ordered the arrest of Escribano, fixed the bail at three thousand pesos, and referred the case to the city fiscal of Cotabato for the filing of the corresponding information. A warrant of arrest was issued on March 31. Sometime before April 16 the city fiscal filed an information for libel against Escribano.

On August 10, 1970 this Court issued a resolution restraining Judge Avila from proceeding with the arraignment of Escribano. The issue is whether the Court of First Instance of Cotabato is invested with authority to conduct the preliminary investigation of the crime of libel committed by means of radio at Cotabato City or whether that power is lodged exclusively in the city attorney of that city. Petitioner Escribano, in support of his contention that the city fiscal of Cotabato is the only functionary empowered to conduct the preliminary investigation of the libel charge, invokes the following provisions of the charter of Cotabato City, Republic Act No. 2364, as amended by Republic Act No. 3332: SEC. 23. The city attorney — His compensation powers and duties. — The provisions of Commonwealth Act Numbered Four hundred nine to the contrary notwithstanding, the city shall have an attorney who shall be the chief legal adviser of the city. ... The city attorney shall have the following powers and duties: xxx xxx xxx (f) He shall investigate an charges of crimes, misdemeanors and violations of laws and city ordinances and prepare the necessary informations or make the necessary complaints against the persons accused. ... (g) He shall have charge of the prosecution of all crimes, misdemeanors and violations of laws and city ordinances triable in the Court of First Instance of Cotabato, and the municipal court of the city, and shall discharge all the duties in respect to Criminal prosecutions enjoined by law upon provincial fiscals. He cites the ruling in Sayo. vs. Chief of Police 80 Phil. 859; Montelibano vs. Ferrer and Benares, 97 Phil. 228, and Guerrero vs. Ferrer, 106 Phil. 1163, that in chartered cities the city fiscal has the exclusive authority to conduct preliminary investigations. He also invokes the following provisions of article 360 of the Revised Penal Code, which were inserted

by Republic Act No. 4363, approved on June 19, 1965, and which do not empower the Court of First Instance to conduct a preliminary investigation of written defamations: Preliminary investigations of criminal actions for written defamations as provided for in the chapter shall be conducted by the provincial or city fiscal of the province or city, or by the municipal court of the city or capital of the province where such actions may be instituted in accordance with the provisions of this article. On the other hand, complainant Pendatun and respondent Judge rely on section 13, Rule 112 of the Rules of Court to support their view that the Court of First Instance of Cotabato could conduct the preliminary investigation: SEC. 13. Preliminary examination and investigation by the judge of the Court of First Instance. — Upon complaint filed directly with the Court of First Instance, without previous preliminary examination and investigation conducted by the of the judge thereof shall either refer the complaint to the municipal judge referred to in the second paragraph of section 2 hereof for preliminary examination and investigation, or himself conduct both preliminary examination and investigation simultaneously in the manner provided in the preceding sections, and should be find reasonable ground to believe that the defendant has committed the offense charged, he shall issue a warrant for his arrest, and thereafter refer the case to the fiscal for the filing of the corresponding information. Was it intended by Republic Act No. 4363, in specifying that the preliminary investigation of criminal actions for written defamations may be conducted by the provincial or city fiscal of the province or city, or the municipal court of the city or capital of the province, where the criminal action may be filed to exclude the Court of First Instance from conducting such preliminary investigation and to entrust that power exclusively to those fiscals and courts? (Libel by means of radio is a written defamation under article 355 of the Revised Penal Code).

As admitted by the petitioner, the purpose of the amendment is to prevent the complainants in written defamation cases from harassing the accused by means of out-of-town libel suits, meaning complaints filed in remote municipal courts (Time, Inc. vs. Reyes, L-28882, May 31, 1971, 39 SCRA 303, 311; p. 11, Memorandum, p. 11 3, Rollo). The rule is that in construing a statute the mischief intended to be removed or suppressed and the causes which induced the enactment of a law are important factors to be considered in its construction (2 Sutherland on Statutory Construction, 885886, cited in Philippine Sugar Centrals Agency vs. Collector of Customs, 51 Phil. 131, 145). Therefore, it is safe to conclude that the enumeration in the amendatory law of the public officers and the courts that may conduct the preliminary investigation of complaints for written defamation was designed to divest the ordinary municipal court of that power but not to deprive the proper Court of First Instance of that same power. Article 360 in its original form provided that the venue of the criminal and civil actions for written defamations is the province wherein the libel was published, displayed or exhibited, regardless of the place where the same was written, printed or composed. Article 360 originally did not specify the public officers and the courts that may conduct the preliminary investigation of complaints for libel. Before article 360 was amended, the rule was that a criminal action for libel may be instituted in any jurisdiction where the libelous article was published or circulated, irrespective of where it was written or printed (People vs. Borja, 43 Phil. 618). Under that rule, the criminal action is transitory and the injured party has a choice of venue. Experience had shown that under that old rule the offended party could harass the accused in a libel case by laying the venue Of the Criminal action in a remote or distant place. Thus, in connection with an article published in the Daily Mirror and the Philippines Free Press, Pio

Pedrosa, Manuel V. Villareal and Joaquin Roces were charged with libel in the justice of the peace court of San Fabian, Pangasinan (Amansec vs. De Guzman 93 Phil. 933). To forestall such harassment, Republic Act No. 4363 laid down the following rules on the venue of the criminal and civil actions in written defamations: * 1. General rule: The action may be filed in the Court of First Instance of the province or city where the libelous article is printed and first published or where any of the offended parties actually resides at the time of the commission of the offense. 2. If the offended party is a public officer with office in Manila at the time the offense was committed, the venue is Manila or the city or province where the libelous article is printed and first published. 3. Where an offended party is a public official with office outside of Manila, the venue is the province or the city where he held office at the time of the commission of the offense or where the libelous article is printed and first published. 4. If an offended party is a private person, the venue is his place of residence at the time of the commission of the offense or where the libelous article is printed and first published. The common feature of the foregoing rules is that whether the offended party is a public officer or a private person, he has always the option to file the action in the Court of First Instance of the province or city where the libelous article is printed or first published. Congress did not confine the amendatory law to laying down the guidelines for the venue of criminal and civil actions. Since, as already noted, its purpose is to minimize the filing in municipal courts of out-of-town libel suit this the lawmaking body, in order to attain that objective, deprived the ordinary municipal courts of the power to conduct. the preliminary investigation of a criminal action for written defamation. In other words, the amendment contains not only the rules limiting the venue of the criminal and civil actions to the Court of First Instance of the province

or city where the libelous matter is printed and first published, or where the offended party held office or resided at the time the libel was committed, but it also specifies that the preliminary investigation should be conducted by the provincial or city fiscal of the province or city or by the municipal court of the city or capital of the province where the action may be instituted. (See People and Navarro vs. Hechanova, L-26459, November 29, 1973, 54 SCRA 101). It should be repeated that the amendment, in specifying those who may conduct the preliminary investigation, deprived the ordinary municipal court of that power in cases of written, defamations. And it should be recalled that the power of the ordinary municipal court to conduct such preliminary investigations under the old law facilitated the filing of libel cases in remote municipal courts and the consequent harassment of the accused. That purpose of the amendment has nothing to do with the power of the Court of First Instance to conduct preliminary investigations in criminal cases cognizable by it. To retain that power of the Court of First Instance would in a way be an implementation of the purpose of the amendment, which is to prevent complainants from harassing and embarrassing the accused with libel suits in distant municipalities. Therefore, it can be stated without fear of successful contradiction that the lawmaking body, by means of that amendment, never intended to take away the jurisdiction of the proper Court of First Instance to conduct a preliminary investigation in libel cases. The amendment merely sought to strip the ordinary municipal court (not the municipal court ee of the provincial capital or the city court) of its power to hold a preliminary investigation of written defamations. The fact that the Court of First Instance is not mentioned in Article 360 as a tribunal that may conduct the preliminary investigation of libel cases would seem to suggest that it cannot conduct such preliminary investigation, following the maxim inclusio unius est exclusio alterius (the inclusion of one thing is the exclusion of another or the enumeration of particular things excludes the

Idea of something else not mentioned, applied in Acosta vs. Flor, 5 Phil. 18; De la Rosa vs. Revita Santos, 10 Phil. 148, 149; Conde vs. Abaya, 13 Phil. 249; Tavora vs. Gavina, 79 Phil. 421, 435; In re Guzman, 73 Phil. 51; In re Estate of Enriquez and Reyes, 29 Phil. 167; Weigall vs. Shuster, 11 Phil. 340, 357; Vega vs. Municipal Board of Iloilo 94 Phil. 949, 953; Gomez vs. Ventura, 54 Phil. 726; Mendenilla vs. Onandia, 115 Phil. 534, 539; Canlas and Manila Pencil Co. vs. Republic, 103 Phil. 712, 716; Lao Oh Kim vs. Reyes, 103 Phil. 1139). Under that canon of legal hermeneutics, where a statute directs the performance of certain acts by a particular person or class of persons, it implies that it shall not be done otherwise or by a different person or class of persons (82 C.J.S. 667668). That maxim is not a rule of law. It is just a tool of statutory construction or a means of ascertaining the legislative intent. It is not of universal application and is not conclusive. It cannot be used to defeat the plainly indicated purpose of the lawmaking body (82 C.J.S. 668). The maxim is inapplicable if there is some special reason for mentioning one thing and none for mentioning another which is otherwise within the statute, so that the absence of any mention of such other will not exclude it (82 C.J.S. 670). The maxim does not apply in case a statute appears upon its face to limit the operation of its provisions to particular persons or things by enumerating them, but no reason exists why other persons or things not so enumerated should not have been included, and manifest injustice win follow by not so including them (Springer vs. Philippine Islands, 72 Law. ed. 845, 227 U.S 189; People vs. Manahan, 115 Phil. 657,6681). The maxim is no more than an auxiliary rule of interpretation to be ignored where other circumstances indicate the enumeration was not intended to be exclusive" (Manabat vs. De Aquino, 92 Phil. 1026, 1027). The maxim cannot be applied in this case because, as shown above, the fact that the Court of First Instance is not mention in the amendment, as being empowered to conduct a preliminary investigation

in cases of written defamation, has nothing to do with the purpose of the amendment. It should be stressed that in construing a law, the court must look to the object to be accomplished, the evils and mischief sought to be remedied, or the purpose to be subserved, and it should give the law a reasonable or liberal construction which win best effect its purpose rather than one which win defeat it (82 C.J.S. 593) It is reasonable to surmise that the Court of First Instance was not mentioned due to inadvertence. That oversight is not unusual since preliminary investigations are usually conducted by municipal courts and fiscals. In practice, a preliminary investigation by the Court of First Instance is the exception, not the general rule. In this connection, it is pertinent to cite the recent ruling that the power of the Court of First Instance to conduct a pre investigation is derived from the constitutional provision that "no warrants shall issue but upon probable cause, to be determined by the judge after examination under oath or affirmation of the complaint and the witness he may produce" (Sec. 1[3], Art. 111, now Sec. 3, Art. IV, 1973 Constitution; Collector of Customs vs. Villaluz, L34038, June 18,1976 and five other cases, 71 SCRA 356). Implicit in that provision is the constitutional grant of power to the judge to hold a preliminary examination and to issue warrants of arrest and search warrants. That which is plainly implied in the language of a law is as much a part of it as that which is expressed (In re McCulloch Dick, 38 Phil 41, 45, 90). The term "judge" embraces a judge of the Court of First Instance. Its coverage is not restricted to judges of inferior courts. The silence of article 360 on the power of a judge of the Court of First Instance to conduct a p investigation of criminal actions for written defamations does not preclude a judge of that court from holding such investigation. However, the exercise of that power is tied up with the rules on the venue of a criminal action for written defamation. That power is lodged in the Court of First Instance of the city or province where

the libelous article was printed or first published or where the offended party actually resided, or where the offended public official held office, at the time of the commission of the offense. Escribano's contention that in chartered cities the city fiscal has the exclusive authority to conduct preliminary investigations is not correct. While section 23(f) of the Charter of Cotabato City (Republic Act No. 2364) empowers its city attorney to "investigate all charges of crimes, misdemeanors and violations of laws and city ordinances and prepare the necessary informations or make the necessary complaints against the persons accused", that power is not exclusive. Section 78 of the same charter provides that the municipal or city court of Catabato City "may also conduct preliminary investigations for any offense, without regard to the limits of punishments", a provision which is found in section 87 of the Judiciary Law and in section 2, Rule 112 of the Rules of Court. That same power is found in the last sentence of section 41 of Republic Act No. 409, the Revised Charter of Manila, which took effect on June 18, 1949 or after Sayo vs. Chief of Police of Manila, 80 Phil. 859 was decided. But that provision is not found in Commonwealth Act No. 326, the charter of Bacolod City, under which Montelibano vs. Ferrer. 97 Phil. 228 and Guerrero vs. Ferrer, 106 Phil. 1163 were decided, nor is it found in the old Manila Charter contained in the Revised Administrative Code. Hence, in the Sayo, Montelibano and Guerrero cases, it was held that the city court could not conduct pre investigations. (See Callanta vs. Villanueva, L-24646 and 24674, June 20, 1977, 77 SCRA 377). WHEREFORE, the petition is dismissed with costs against the petitioner. SO ORDERED.