digested cases consti

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January 29, 1937

G.R. No. L-45358NARCISO ALVAREZ, petitioner,vs.THE COURT OF FIRST INSTANCE OF TAYABAS and THE ANTI-USURY BOARD,respondents. .

Imperial, J. :

Facts:

On June 3, 1936, the chief of of the secret service of the Anti-Usury Board presented to Judge David, presiding judge of CFI of Tayabas, alleging that according to reliable information, the petitioner iskeeping in his house in Infanta, Tayabas documents, receipts, lists, chits and other papers used by him inconnection with his activities as a money lender charging usurious rates of interest in violation of the law.

In his oath the chief of the secret service did not swear to the truth of his statements upon his knowledgeof the facts but the information received by him from a reliable person. Upon this questioned affidavit, the

judge issued the search warrant, ordering the search of the petitioners house at any time of the day or night, the seizure of the books and documents and the immediate delivery of such to him (judge). Withsaid warrant, several agents of the Anti-Usury Board entered the petitioner's store and residence at 7o'clock of the night and seized and took possession of various articles belonging to the petitioner.

Issues/s:

1.) What is the nature of searchers and seizures as contemplated in the law?

2.) What is required of the oath in the issuance of search warrant?

3.) What is the purpose of the disposition in addition to the affidavit?

4.) Whether or not the search warrant could be served at night?

5.) Whether or not the seizure of evidence to use in an investigation is constitutional?

6.) Whether or not there was a waiver of constitutional guarantees?

Ruling:

Summarizing the foregoing conclusions, we hold:

1. That the provisions of the Constitution and General Orders, No. 58, relative to search and seizure,should be given a liberal construction in favor of the individual in order to maintain the constitutionalguaranties whole and in their full force;

2. That since the provisions in question are drastic in their form and fundamentally restrict the enjoymentof the ownership, possession and use of the personal property of the individual, they should be strictlyconstrued;


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3. That the search and seizure made are illegal for the following reasons: (a) Because the warrant was based solely upon the affidavit of the petitioner who had no personal knowledge of the facts of probablecause, and (b) because the warrant was issued for the sole purpose of seizing evidence which would later

be used in the criminal proceedings that might be instituted against the petitioner, for violation of theAnti-Usury Law;

4. That as the warrant had been issued unreasonably, and as it does not appear positively in the affidavitthat the articles were in the possession of the petitioner and in the place indicated, neither could the searchand seizure be made at night;

5. That although it is not mandatory to present affidavits of witnesses to corroborate the applicant or acomplainant in cases w here the latter has personal knowledge of the facts, when the applicants or complainants knowledge of the facts is merely hearsay, it is the duty of the judge to require affidavits of other witnesses so that he may determine whether probable cause exists;

6. That a detailed description of the person and place to be searched and the articles to be seized isnecessary, but whereby, by the nature of the articles to be seized, their description must be rather general,

but is not required that a technical description be given, as this would mean that no warrant could issue;

7. That the petitioner did not waive his constitutional rights because the offer of compromise or settlementattributed to him, does not mean, if so made, that he voluntarily tolerated the search and seizure; and

8. That an appeal from the orders questioned by the petitioner, if taken by him, would not be an effective,speedy or adequate remedy in the ordinary course of law, and, consequently, the petition for mandamus filed by him, lies.

For the foregoing considerations, the search warrant and the seizure of June 3, 1936, and the orders of therespondent court authorizing the relation of the books and documents, are declared illegal and are setaside, and it is ordered that the judge presiding over the Court of First Instance of Tayabas direct the

immediate return to the petitioner of the nineteen (19) documents designated on pages 1 to 4 of theinventory by Nos. 5, 10, 16, 23, 25,26, 27, 30, 31, 34, 36, 37, 38, 39, 40, 41, 42, 43 and 45, withoutspecial pronouncement as to costs. So ordered.


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G.R. No. L-45950 June 20, 1938

LEONA PASION VIUDA DE GARCIA,petitioner,vs.DIEGO LOCSIN, Judge of First Instance of Tarlac,FELIX IMPERIAL, Provincial Fiscal of Tarlac, and the ANTI-USURY BOARD,respondents.

LAUREL, J.:

Facts:

This is a petition for mandamus presented to secure the annulment of a search warrant and two orders of the respondent judge, and the restoration of certain documents alleged to have been illegally seized by anagent of the Anti-Usuary Board.

It appears that on November 10, 1934, Mariano G. Almeda, an agent of the Anti-Usuary Board, obtainedfrom the justice of the peace of Tarlac, Tarlac, a search warrant(Exhibit B) commanding any officer of the

law to search the person, house or store of the petitioner at Victoria, Tarlac, for "certain books, lists, chits,receipts, documents and other papers relating to her activities as usurer." The search warrant was issuedupon an affidavit given by the said Almeda "that he has and there (is) just and probable cause to believeand he does believe that Leona Pasion de Garcia keeps and conceals in her house and store at Victoria,Tarlac, certain books, lists, chits, receipts, documents, and other papers relating to her activities as usurer,all of which is contrary to the statute in such cases made and provided." On the same date, the saidMariano G. Almeda, accompanied by a captain of the Philippine Constabulary, went to the office of the

petitioner in Victoria, Tarlac and, after showing the search warrant to the petitioner's bookkeeper, AlfredoSalas, and, without the presence of the petitioner who was ill and confined at the time, proceeded with theexecution thereof.

Issue/s:

Whether or not the search warrant was properly issued with a probable cause.

Ruling:

In the instant case the existence of probable cause was determined not by the judge himself but by theapplicant. All that the judge did was to accept as true the affidavit made by agent Almeda. He did notdecide for himself. It does not appear that he examined the applicant and his witnesses, if any. Evenaccepting the description of the properties to be seized to be sufficient and on the assumption that thereceipt issued is sufficiently detailed within the meaning of the law, the properties seized were notdelivered to the court which issued the warrant, as required by law. (See, secs. 95 and 104, G. O. No. 58.)instead, they were turned over to the respondent provincial fiscal and used by him in building up cases

against the petitioner. Considering that at the time the warrant was issued there was no case pendingagainst the petitioner, the averment that the warrant was issued primarily for exploration purposes is notwithout basis. The lower court is, therefore, correct in reaching the conclusion that the search warrant(Exhibit B) was illegally issued by the justice of the peace of Tarlac, Tarlac.

The important question presented is whether upon the facts and under the circumstances of the presentcase, there has been a waiver by the petitioner of her constitutional immunity against unreasonablesearches and seizures. While the Solicitor-General admits that, in the light of decisions of this court, thesearch warrant was illegally issued, he maintains "(1) that the petitioner had waived her constitutional


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right by her acquiescence after the search and seizure, and (2) that the application for the return of thedocuments illegally seized was made after an unreasonable length of time after the date of seizure."Doubtless, the constitutional immunity against unreasonable searches and seizures is a personal rightwhich may be waived. (People vs. Kagui Malasugui, 34 Off. Gaz., pp. 2163, 2164; 56 C.J., pp. 1178,1179; Cf. Rodriguez vs. Villamiel, supra .) The waiver may be either express or implied (67 C.J., p. 304).

No express waiver has been made in the case before us. It is urged, however, that there has been a waiver by implication. It is well-settled that to constitute a waiver of a constitutional right, it must appear, first,that the right exists; secondly, that the persons involved had knowledge, either actual or constructive, of the existence of such right; and, lastly, that said person had an actual intention to relinquish the right. (67C. J., 299.) It is true that the petitioner did not object to the legality of the search when it was made. Shecould not have objected because she was sick and was not present when the warrant was served uponAlfredo Salas. Certainly, the constitutional immunity from unreasonable searches and seizures, being a

personal one, cannot be waived by anyone except the person whose rights are invaded or one who isexpressly authorized to do so in his or her behalf. (56 C. J., p. 1183.) Of course, the petitioner came toknow later of the seizure of some of her papers and documents. But this was precisely the reason why shesent her attorneys to the office of the Anti-Usuary Board to demand the return of the documents seized. Inany event, the failure on the part of the petitioner and her bookkeeper to resist or object to the executionof the warrant does not constitute an implied waiver of constitutional right. It is, as Judge Cooleyobserves, but a submission to the authority of the law. (Const. Lim., 8th ed., Vol., I, p. 630.) As theconstitutional guaranty is not dependent upon any affirmative act of the citizen, the courts do not place thecitizen in the position of either contesting an officer's authority by force, or waiving his constitutionalrights; but instead they hold that a peaceful submission to a search or seizure is not a consent or aninvitation thereto, but is merely a demonstration of regard for the supremacy of the law. (56 C.J., pp.1180, 1181.)

As a general proposition, it may be admitted that waiver may be the result of a failure to object within areasonable time to a search and seizure illegally made. It must be observed, however, that the petitioner,on several occasions, and prior to the filing of criminal actions against her, had demanded verbally,through counsel, the return by the Anti-Usuary Board of the properties seized. This is admitted by Adolfo

N. Feliciano, acting chief of the board, who said that the demand was refused simply because nohabiamos terminado con nuestra investigacion . (T.s.n., pp. 24-25.) On July 7, 1936, counsel for the

petitioner wrote a letter to the Anti-Usuary Board demanding again the return of the documents withheld.And in connection with the criminal cases pending against the petitioner, similar demands were made onJanuary 7, 1937 and on June 4, 1937. In the light of these circumstances, we find that the petitioner didnot waive her constitutional right. The delay in making demand for the return of the documents seized isnot such as to result in waiver by implication.

In view of the foregoing, the writ prayed for is granted. The search warrant, Exhibit B, is hereby declaredvoid and of no effect; the orders of October 5, 1937 and January 3, 1938 of the respondent judge are setaside; and the respondents Anti-Usuary Board and the provincial fiscal of Tarlac or those acting in their

behalf, are hereby ordered to return and restore to the petitioner all the properties, documents, papers andeffects illegally seized from her, within forty-eight (48) hours from the time this decision becomes final.Without costs. So ordered.


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G.R. No. L-11390 March 26, 1918

EL BANCO ESPAOL-FILIPINO,plaintiff-appellant,vs.VICENTE PALANCA, administrator of the estate of Engracio Palanca Tanquinyeng, defendant-appellant.

STREET, J. :

Facts:

Engracio Palanca had a debt to the bank and his parcel of land serve as a mortgage. He left to go to chinaand never return until he died and the bank recovered his land as a payment for his debt. The bank

publishes a notice in a newspaper of general circulation and when no one appeared to be an heir of Palanca, the bank recovered the land. After 7 years, a certain Vicente who said that he is the administrator of Palanca and petition for the nullification of the ruling alleging that it was done without due process of the law.

Issue:

Whether or not the parcel of land had been taken without due process of the law.

Ruling:

It is stated in the affidavit that the defendant, Engracio Palanca Tanquinyeng y Limquingco, died January29, 1910. The mortgage under which the property was sold was executed far back in 1906; and the

proceedings in the foreclosure were closed by the order of court confirming the sale dated August 7,1908. It passes the rational bounds of human credulity to suppose that a man who had placed a mortgageupon property worth nearly P300,000 and had then gone away from the scene of his life activities to endhis days in the city of Amoy, China, should have long remained in ignorance of the fact that the mortgagehad been foreclosed and the property sold, even supposing that he had no knowledge of those proceedingswhile they were being conducted. It is more in keeping with the ordinary course of things that he shouldhave acquired information as to what was transpiring in his affairs at Manila; and upon the basis of thisrational assumption we are authorized, in the absence of proof to the contrary, to presume that he didhave, or soon acquired, information as to the sale of his property.

The Code of Civil Procedure, indeed, expressly declares that there is a presumption that things havehappened according to the ordinary habits of life (sec. 334 [26]); and we cannot conceive of a situationmore appropriate than this for applying the presumption thus defined by the lawgiver. In support of this

presumption, as applied to the present case, it is permissible to consider the probability that the defendantmay have received actual notice of these proceedings from the unofficial notice addressed to him inManila which was mailed by an employee of the bank's attorneys. Adopting almost the exact words used

by the Supreme Court of the United States in Grannis vs. Ordeans (234 U. S., 385; 58 L. ed., 1363), wemay say that in view of the well-known skill of postal officials and employees in making proper deliveryof letters defectively addressed, we think the presumption is clear and strong that this notice reached thedefendant, there being no proof that it was ever returned by the postal officials as undelivered. And if itwas delivered in Manila, instead of being forwarded to Amoy, China, there is a probability that therecipient was a person sufficiently interested in his affairs to send it or communicate its contents to him.


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Of course if the jurisdiction of the court or the sufficiency of the process of law depended upon themailing of the notice by the clerk, the reflections in which we are now indulging would be idle andfrivolous; but the considerations mentioned are introduced in order to show the propriety of applying tothis situation the legal presumption to which allusion has been made. Upon that presumption, supported

by the circumstances of this case, ,we do not hesitate to found the conclusion that the defendantvoluntarily abandoned all thought of saving his property from the obligation which he had placed upon it;that knowledge of the proceedings should be imputed to him; and that he acquiesced in the consequencesof those proceedings after they had been accomplished. Under these circumstances it is clear that themerit of this motion is, as we have already stated, adversely affected in a high degree by the delay inasking for relief. Nor is it an adequate reply to say that the proponent of this motion is an administrator who only qualified a few months before this motion was made. No disability on the part of the defendanthimself existed from the time when the foreclosure was effected until his death; and we believe that thedelay in the appointment of the administrator and institution of this action is a circumstance which isimputable to the parties in interest whoever they may have been. Of course if the minor heirs hadinstituted an action in their own right to recover the property, it would have been different.

It is, however, argued that the defendant has suffered prejudice by reason of the fact that the bank becamethe purchaser of the property at the foreclosure sale for a price greatly below that which had been agreedupon in the mortgage as the upset price of the property. In this connection, it appears that in article nine of the mortgage which was the subject of this foreclosure, as amended by the notarial document of July 19,1906, the parties to this mortgage made a stipulation to the effect that the value therein placed upon themortgaged properties should serve as a basis of sale in case the debt should remain unpaid and the bank should proceed to a foreclosure. The upset price stated in that stipulation for all the parcels involved inthis foreclosure was P286,000. It is said in behalf of the appellant that when the bank bought in the

property for the sum of P110,200 it violated that stipulation.

It has been held by this court that a clause in a mortgage providing for a tipo, or upset price, does not prevent a foreclosure, nor affect the validity of a sale made in the foreclosure proceedings. (Yangco vs.Cruz Herrera and Wy Piaco, 11 Phil. Rep., 402; Banco-Espaol Filipino vs. Donaldson, Sim and Co., 5Phil. Rep., 418.) In both the cases here cited the property was purchased at the foreclosure sale, not by thecreditor or mortgagee, but by a third party. Whether the same rule should be applied in a case where themortgagee himself becomes the purchaser has apparently not been decided by this court in any reporteddecision, and this question need not here be considered, since it is evident that if any liability was incurred

by the bank by purchasing for a price below that fixed in the stipulation, its liability was a personalliability derived from the contract of mortgage; and as we have already demonstrated such a liabilitycould not be the subject of adjudication in an action where the court had no jurisdiction over the person of the defendant. If the plaintiff bank became liable to account for the difference between the upset price andthe price at which in bought in the property, that liability remains unaffected by the disposition which thecourt made of this case; and the fact that the bank may have violated such an obligation can in no wiseaffect the validity of the judgment entered in the Court of First Instance.

In connection with the entire failure of the motion to show either a meritorious defense to the action or that the defendant had suffered any prejudice of which the law can take notice, we may be permitted toadd that in our opinion a motion of this kind, which proposes to unsettle judicial proceedings long agoclosed, can not be considered with favor, unless based upon grounds which appeal to the conscience of the court. Public policy requires that judicial proceedings be upheld. The maximum here applicable is nonquieta movere. As was once said by Judge Brewer, afterwards a member of the Supreme Court of theUnited States:


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Public policy requires that judicial proceedings be upheld, and that titles obtained in those proceedings be safe from the ruthless hand of collateral attack. If technical defects are adjudged potent to destroy such titles, a judicial sale will never realize that value of the property, for no prudent man will risk his money in bidding for and buying that title which he has reason to fear may years thereafter be swept away through some occult and not readily discoverable defect.(Martin vs. Pond, 30 Fed., 15.)

In the case where that language was used an attempt was made to annul certain foreclosure proceedingson the ground that the affidavit upon which the order of publication was based erroneously stated that theState of Kansas, when he was in fact residing in another State. It was held that this mistake did not affectthe validity of the proceedings.

In the preceding discussion we have assumed that the clerk failed to send the notice by post as required bythe order of the court. We now proceed to consider whether this is a proper assumption; and the

proposition which we propose to establish is that there is a legal presumption that the clerk performed hisduty as the ministerial officer of the court, which presumption is not overcome by any other factsappearing in the cause.

In subsection 14 of section 334 of the Code of Civil Procedure it is declared that there is a presumption"that official duty has been regularly performed;" and in subsection 18 it is declared that there is a

presumption "that the ordinary course of business has been followed." These presumptions are of coursein no sense novelties, as they express ideas which have always been recognized. Omnia presumuntur riteet solemniter esse acta donec probetur in contrarium. There is therefore clearly a legal presumption thatthe clerk performed his duty about mailing this notice; and we think that strong considerations of policyrequire that this presumption should be allowed to operate with full force under the circumstances of thiscase. A party to an action has no control over the clerk of the court; and has no right to meddle undulywith the business of the clerk in the performance of his duties. Having no control over this officer, thelitigant must depend upon the court to see that the duties imposed on the clerk are performed.

Other considerations no less potent contribute to strengthen the conclusion just stated. There is no principle of law better settled than that after jurisdiction has once been required, every act of a court of general jurisdiction shall be presumed to have been rightly done. This rule is applied to every judgment or decree rendered in the various stages of the proceedings from their initiation to their completion(Voorhees vs. United States Bank, 10 Pet., 314; 35 U. S., 449); and if the record is silent with respect toany fact which must have been established before the court could have rightly acted, it will be presumedthat such fact was properly brought to its knowledge. (The Lessee of Grignon vs. Astor, 2 How., 319; 11L. ed., 283.)

In making the order of sale [of the real state of a decedent] the court are presumed to haveadjudged every question necessary to justify such order or decree, viz: The death of the owners;that the petitioners were his administrators; that the personal estate was insufficient to pay thedebts of the deceased; that the private acts of Assembly, as to the manner of sale, were within theconstitutional power of the Legislature, and that all the provisions of the law as to notices whichare directory to the administrators have been complied with. . . . The court is not bound to enter upon the record the evidence on which any fact was decided. (Florentine vs. Barton, 2 Wall., 210;17 L. ed., 785.) Especially does all this apply after long lapse of time.

Applegate vs. Lexington and Carter County Mining Co. (117 U. S., 255) contains an instructivediscussion in a case analogous to that which is now before us. It there appeared that in order to foreclose amortgage in the State of Kentucky against a nonresident debtor it was necessary that publication should


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be made in a newspaper for a specified period of time, also be posted at the front door of the court houseand be published on some Sunday, immediately after divine service, in such church as the court shoulddirect. In a certain action judgment had been entered against a nonresident, after publication in pursuanceof these provisions. Many years later the validity of the proceedings was called in question in another action. It was proved from the files of an ancient periodical that publication had been made in its columnsas required by law; but no proof was offered to show the publication of the order at the church, or the

posting of it at the front door of the court-house. It was insisted by one of the parties that the judgment of the court was void for lack of jurisdiction. But the Supreme Court of the United States said:

The court which made the decree . . . was a court of general jurisdiction. Therefore every presumption not inconsistent with the record is to be indulged in favor of its jurisdiction. . . . It isto be presumed that the court before making its decree took care of to see that its order for constructive service, on which its right to make the decree depended, had been obeyed.

It is true that in this case the former judgment was the subject of collateral , or indirect attack, while in thecase at bar the motion to vacate the judgment is direct proceeding for relief against it. The same general

presumption, however, is indulged in favor of the judgment of a court of general jurisdiction, whether it isthe subject of direct or indirect attack the only difference being that in case of indirect attack the judgmentis conclusively presumed to be valid unless the record affirmatively shows it to be void, while in case of direct attack the presumption in favor of its validity may in certain cases be overcome by proof extrinsicto the record.

The presumption that the clerk performed his duty and that the court made its decree with the knowledgethat the requirements of law had been complied with appear to be amply sufficient to support theconclusion that the notice was sent by the clerk as required by the order. It is true that there ought to befound among the papers on file in this cause an affidavit, as required by section 400 of the Code of CivilProcedure, showing that the order was in fact so sent by the clerk; and no such affidavit appears. Therecord is therefore silent where it ought to speak. But the very purpose of the law in recognizing these

presumptions is to enable the court to sustain a prior judgment in the face of such an omission. If we wereto hold that the judgment in this case is void because the proper affidavit is not present in the file of

papers which we call the record, the result would be that in the future every title in the Islands restingupon a judgment like that now before us would depend, for its continued security, upon the presence of such affidavit among the papers and would be liable at any moment to be destroyed by the disappearanceof that piece of paper. We think that no court, with a proper regard for the security of judicial proceedingsand for the interests which have by law been confided to the courts, would incline to favor such aconclusion. In our opinion the proper course in a case of this kind is to hold that the legal presumptionthat the clerk performed his duty still maintains notwithstanding the absence from the record of the proper

proof of that fact.

In this connection it is important to bear in mind that under the practice prevailing in the PhilippineIslands the word "record" is used in a loose and broad sense, as indicating the collective mass of paperswhich contain the history of all the successive steps taken in a case and which are finally deposited in thearchives of the clerk's office as a memorial of the litigation. It is a matter of general information that no

judgment roll, or book of final record, is commonly kept in our courts for the purpose of recording the pleadings and principal proceedings in actions which have been terminated; and in particular, no suchrecord is kept in the Court of First Instance of the city of Manila. There is, indeed, a section of the Codeof Civil Procedure which directs that such a book of final record shall be kept; but this provision has, as amatter of common knowledge, been generally ignored. The result is that in the present case we do nothave the assistance of the recitals of such a record to enable us to pass upon the validity of this judgment


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and as already stated the question must be determined by examining the papers contained in the entirefile.

But it is insisted by counsel for this motion that the affidavit of Bernardo Chan y Garcia showing thatupon April 4, 1908, he sent a notification through the mail addressed to the defendant at Manila,Philippine Islands, should be accepted as affirmative proof that the clerk of the court failed in his duty andthat, instead of himself sending the requisite notice through the mail, he relied upon Bernardo to send itfor him. We do not think that this is by any means a necessary inference. Of course if it had affirmativelyappeared that the clerk himself had attempted to comply with this order and had directed the notificationto Manila when he should have directed it to Amoy, this would be conclusive that he had failed to complywith the exact terms of the order; but such is not this case. That the clerk of the attorneys for the plaintiff erroneously sent a notification to the defendant at a mistaken address affords in our opinion very slight

basis for supposing that the clerk may not have sent notice to the right address.

There is undoubtedly good authority to support the position that when the record states the evidence or makes an averment with reference to a jurisdictional fact, it will not be presumed that there was other or different evidence respecting the fact, or that the fact was otherwise than stated. If, to give an illustration,it appears from the return of the officer that the summons was served at a particular place or in a

particular manner, it will not be presumed that service was also made at another place or in a differentmanner; or if it appears that service was made upon a person other than the defendant, it will not be

presumed, in the silence of the record, that it was made upon the defendant also (Galpin vs. Page, 18Wall., 350, 366; Settlemier vs. Sullivan, 97 U. S., 444, 449). While we believe that these propositions areentirely correct as applied to the case where the person making the return is the officer who is by lawrequired to make the return, we do not think that it is properly applicable where, as in the present case, theaffidavit was made by a person who, so far as the provisions of law are concerned, was a mereintermeddler.

The last question of importance which we propose to consider is whether a motion in the cause isadmissible as a proceeding to obtain relief in such a case as this. If the motion prevails the judgment of July 2, 1908, and all subsequent proceedings will be set aside, and the litigation will be renewed,

proceeding again from the date mentioned as if the progress of the action had not been interrupted. The proponent of the motion does not ask the favor of being permitted to interpose a defense. His purpose ismerely to annul the effective judgment of the court, to the end that the litigation may again resume itsregular course.

There is only one section of the Code of Civil Procedure which expressly recognizes the authority of aCourt of First Instance to set aside a final judgment and permit a renewal of the litigation in the samecause. This is as follows:

SEC. 113. Upon such terms as may be just the court may relieve a party or legal representativefrom the judgment, order, or other proceeding taken against him through his mistake,inadvertence, surprise, or excusable neglect; Provided, That application thereof be made within areasonable time, but in no case exceeding six months after such judgment, order, or proceedingwas taken.

An additional remedy by petition to the Supreme Court is supplied by section 513 of the same Code. Thefirst paragraph of this section, in so far as pertinent to this discussion, provides as follows:

When a judgment is rendered by a Court of First Instance upon default, and a party thereto isunjustly deprived of a hearing by fraud, accident, mistake or excusable negligence, and the Court


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of First Instance which rendered the judgment has finally adjourned so that no adequate remedyexists in that court, the party so deprived of a hearing may present his petition to the SupremeCourt within sixty days after he first learns of the rendition of such judgment, and not thereafter,setting forth the facts and praying to have judgment set aside. . . .

It is evident that the proceeding contemplated in this section is intended to supplement the remedy provided by section 113; and we believe the conclusion irresistible that there is no other meansrecognized by law whereby a defeated party can, by a proceeding in the same cause, procure a judgmentto be set aside, with a view to the renewal of the litigation.

The Code of Civil Procedure purports to be a complete system of practice in civil causes, and it contains provisions describing with much fullness the various steps to be taken in the conduct of such proceedings.To this end it defines with precision the method of beginning, conducting, and concluding the civil actionof whatever species; and by section 795 of the same Code it is declared that the procedure in all civilaction shall be in accordance with the provisions of this Code. We are therefore of the opinion that theremedies prescribed in sections 113 and 513 are exclusive of all others, so far as relates to the openingand continuation of a litigation which has been once concluded.

The motion in the present case does not conform to the requirements of either of these provisions; and theconsequence is that in our opinion the action of the Court of First Instance in dismissing the motion was

proper.

If the question were admittedly one relating merely to an irregularity of procedure, we cannot supposethat this proceeding would have taken the form of a motion in the cause, since it is clear that, if based onsuch an error, the came to late for relief in the Court of First Instance. But as we have already seen, themotion attacks the judgment of the court as void for want of jurisdiction over the defendant. The ideaunderlying the motion therefore is that inasmuch as the judgment is a nullity it can be attacked in any wayand at any time. If the judgment were in fact void upon its face, that is, if it were shown to be a nullity byvirtue of its own recitals, there might possibly be something in this. Where a judgment or judicial order isvoid in this sense it may be said to be a lawless thing, which can be treated as an outlaw and slain at sight,or ignored wherever and whenever it exhibits its head.

But the judgment in question is not void in any such sense. It is entirely regular in form, and the allegeddefect is one which is not apparent upon its face. It follows that even if the judgment could be shown to

be void for want of jurisdiction, or for lack of due process of law, the party aggrieved thereby is bound toresort to some appropriate proceeding to obtain relief. Under accepted principles of law and practice, longrecognized in American courts, a proper remedy in such case, after the time for appeal or review has

passed, is for the aggrieved party to bring an action to enjoin the judgment, if not already carried intoeffect; or if the property has already been disposed of he may institute suit to recover it. In every situationof this character an appropriate remedy is at hand; and if property has been taken without due process, thelaw concedes due process to recover it. We accordingly old that, assuming the judgment to have beenvoid as alleged by the proponent of this motion, the proper remedy was by an original proceeding and not

by motion in the cause. As we have already seen our Code of Civil Procedure defines the conditionsunder which relief against a judgment may be productive of conclusion for this court to recognize such a

proceeding as proper under conditions different from those defined by law. Upon the point of procedurehere involved, we refer to the case of People vs. Harrison (84 Cal., 607) wherein it was held that a motionwill not lie to vacate a judgment after the lapse of the time limited by statute if the judgment is not voidon its face; and in all cases, after the lapse of the time limited by statute if the judgment is not void on itsface; and all cases, after the lapse of such time, when an attempt is made to vacate the judgment by a


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proceeding in court for that purpose an action regularly brought is preferable, and should be required. Itwill be noted taken verbatim from the California Code (sec. 473).

The conclusions stated in this opinion indicate that the judgment appealed from is without error, and thesame is accordingly affirmed, with costs. So ordered.


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G.R. No. L-7995 May 31, 1957

LAO H. ICHONG, in his own behalf and in behalf of other alien residents, corporations andpartnerships adversely affected. by Republic Act No. 1180,petitioner,vs.JAIME HERNANDEZ, Secretary of Finance, and MARCELINO SARMIENTO, City Treasurer of Manila, respondents.

LABRADOR,J. :

Facts:

The Legislature passed R.A. 1180 (An Act to Regulate the Retail Business). Its purpose was to prevent persons who are not citizens of the Phil. from having a stranglehold upon the peoples economic life. LaoIchong, in his own behalf and behalf of other alien residents, corporations and partnerships affected by theAct, filed an action to declare it unconstitutional.

Issue/s:Whether or not the acts deprives an alien from equal protection of the laws.

Ruling:

Resuming what we have set forth above we hold that the disputed law was enacted to remedy a real actualthreat and danger to national economy posed by alien dominance and control of the retail business andfree citizens and country from dominance and control; that the enactment clearly falls within the scope of the police power of the State, thru which and by which it protects its own personality and insures itssecurity and future; that the law does not violate the equal protection clause of the Constitution becausesufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation

regulated, nor the due process of law clause, because the law is prospective in operation and recognizesthe privilege of aliens already engaged in the occupation and reasonably protects their privilege; that thewisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident as a matter of fact it seems not only appropriate but actually necessary and that in any case such matter fallswithin the prerogative of the Legislature, with whose power and discretion the Judicial department of theGovernment may not interfere; that the provisions of the law are clearly embraced in the title, and thissuffers from no duplicity and has not misled the legislators or the segment of the population affected; andthat it cannot be said to be void for supposed conflict with treaty obligations because no treaty hasactually been entered into on the subject and the police power may not be curtailed or surrendered by anytreaty or any other conventional agreement.

Some members of the Court are of the opinion that the radical effects of the law could have been made

less harsh in its impact on the aliens. Thus it is stated that the more time should have been given in thelaw for the liquidation of existing businesses when the time comes for them to close. Our legal duty,however, is merely to determine if the law falls within the scope of legislative authority and does nottranscend the limitations of due process and equal protection guaranteed in the Constitution. Remediesagainst the harshness of the law should be addressed to the Legislature; they are beyond our power and

jurisdiction.


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G.R. No. L-44143 August 31, 1988

THE PEOPLE OF THE PHILIPPINES, plaintiff,vs.EUSEBIO NAZARIO,accused-appellant. .

SARMIENTO, J.:

Facts:

Eusebio Nazario was charged in violation of refusal and failure to pay his municipal taxes amounting toPhp 362.62 because of his fishpond operation provided under Ordinance 4, Series of 1955, as amended.He is a resident of Sta. Mesa Manila and just leases a fishpond located at Pagbilao, Quezon with thePhilippine Fisheries Commission. The years in question of failure to pay was for 1964, 1965, and 1966.

Nazario did not pay because he was not sure if he was covered under the ordinance. He was found guiltythus this petition.

Issues:

I.

THE LOWER COURT ERRED IN NOT DECLARING THAT ORDINANCE NO. 4, SERIES OF 1955,AS AMENDED BY ORDINANCE NO. 15, SERIES OF 1965, AND AS FURTHER AMENDED BYORDINANCE NO. 12, SERIES OF 1966, OF THE MUNICIPALITY OF PAGBILAO, QUEZON, IS

NULL AND VOID FOR BEING AMBIGUOUS AND UNCERTAIN.

II.

THE LOWER COURT ERRED IN NOT HOLDING THAT THE ORDINANCE IN QUESTION, ASAMENDED, IS UNCONSTITUTIONAL FOR BEING EX POST FACTO.

III.

THE LOWER COURT ERRED IN NOT HOLDING THAT THE ORDINANCE IN QUESTIONCOVERS ONLY OWNERS OR OVERSEER OF FISHPONDS OF PRIVATE OWNERSHIP AND NOTTO LESSEES OF PUBLIC LANDS.

IV.

THE LOWER COURT ERRED IN NOT FINDING THAT THE QUESTIONED ORDINANCE, EVEN

IF VALID, CANNOT BE ENFORCED BEYOND THE TERRITORIAL LIMITS OF PAGBILAO ANDDOES NOT COVER NON-RESIDENT.


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Ruling:

The ordinances in question are Ordinance No. 4, series of 1955, Ordinance No. 15, series of 1965, andOrdinance No. 12, series of 1966, of the Municipal Council of Pagbilao. Insofar as pertinent to thisappeal, the salient portions thereof are hereinbelow quoted:

Section 1. Any owner or manager of fishponds in places within the territorial limits of Pagbilao, Quezon, shall pay a municipal tax in the amount of P3.00 per hectare of fishpond on part thereof per annum. 5

xxx xxx xxx

Sec. l (a). For the convenience of those who have or owners or managers of fishpondswithin the territorial limits of this municipality, the date of payment of municipal taxrelative thereto, shall begin after the lapse of three (3) years starting from the date saidfishpond is approved by the Bureau of Fisheries. 6

xxx xxx xxx

Section 1. Any owner or manager of fishponds in places within the territorial limits of Pagbilao shall pay a municipal tax in the amount of P3.00 per hectare or any fractionthereof per annum beginning and taking effect from the year 1964, if the fishpond startedoperating before the year 1964. 7

The first objection refers to the ordinances being allegedly "ambiguous and uncertain." 8 The petitioner contends that being a mere lessee of the fishpond, he is not covered since the said ordinances speak of "owner or manager." He likewise maintains that they are vague insofar as they reckon the date of

payment: Whereas Ordinance No. 4 provides that parties shall commence payment "after the lapse of three (3) years starting from the date said fishpond is approved by the Bureau of Fisheries." 9 Ordinance

No. 12 states that liability for the tax accrues "beginning and taking effect from the year 1964 if thefishpond started operating before the year 1964." 10

As a rule, a statute or act may be said to be vague when it lacks comprehensible standards that men "of common intelligence must necessarily guess at its meaning and differ as to its application." 11 It isrepugnant to the Constitution in two respects: (1) it violates due process for failure to accord persons,especially the parties targetted by it, fair notice of the conduct to avoid; and (2) it leaves law enforcersunbridled discretion in carrying out its provisions and becomes an arbitrary flexing of the Governmentmuscle.

But the act must be utterly vague on its face, that is to say, it cannot be clarified by either a saving clauseor by construction. Thus, in Coates v. City of Cincinnati , 12 the U.S. Supreme Court struck down an

ordinance that had made it illegal for "three or more persons to assemble on any sidewalk and thereconduct themselves in a manner annoying to persons passing by." 13 Clearly, the ordinance imposed nostandard at all "because one may never know in advance what 'annoys some people but does not annoyothers.' " 14

Coates highlights what has been referred to as a "perfectly vague" 15 act whose obscurity is evident on itsface. It is to be distinguished, however, from legislation couched in imprecise language but whichnonetheless specifies a standard though defectively phrased in which case, it may be "saved" by proper construction.


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It must further be distinguished from statutes that are apparently ambiguous yet fairly applicable tocertain types of activities. In that event, such statutes may not be challenged whenever directed againstsuch activities. In Parker v. Levy , 16 a prosecution originally under the U.S. Uniform Code of MilitaryJustice (prohibiting, specifically, "conduct unbecoming an officer and gentleman"), the defendant, anarmy officer who had urged his men not to go to Vietnam and called the Special Forces trained to fightthere thieves and murderers, was not allowed to invoke the void for vagueness doctrine on the premisethat accepted military interpretation and practice had provided enough standards, and consequently, a fair notice that his conduct was impermissible.

It is interesting that in Gonzales v. Commission on Elections , 17 a divided Court sustained an act of Congress (Republic Act No. 4880 penalizing "the too early nomination of candidates" 18 limiting theelection campaign period, and prohibiting "partisan political activities"), amid challenges of vaguenessand overbreadth on the ground that the law had included an "enumeration of the acts deemed included inthe terms 'election campaign' or 'partisan political activity" 19 that would supply the standards. "As thuslimited, the objection that may be raised as to vagueness has been minimized, if not totally set at rest." 20 In his opinion, however, Justice Sanchez would stress that the conduct sought to be prohibited "is notclearly defined at all." 21 "As worded in R.A 4880, prohibited discussion could cover the entire spectrumof expression relating to candidates and political parties." 22 He was unimpressed with the "restrictions"Fernando's opinion had relied on: " 'Simple expressions of opinions and thoughts concerning the election'and expression of 'views on current political problems or issues' leave the reader conjecture, toguesswork, upon the extent of protection offered, be it as to the nature of the utterance ('simpleexpressions of opinion and thoughts') or the subject of the utterance ('current political problems or issues')." 23

The Court likewise had occasion to apply the "balancing-of-interests" test, 24 insofar as the statute's banon early nomination of candidates was concerned: "The rational connection between the prohibition of Section 50-A and its object, the indirect and modest scope of its restriction on the rights of speech andassembly, and the embracing public interest which Congress has found in the moderation of partisan

political activity, lead us to the conclusion that the statute may stand consistently with and does notoffend the Constitution." 25 In that case, Castro would have the balance achieved in favor of Stateauthority at the "expense" of individual liberties.

In the United States, which had ample impact on Castro's separate opinion, the balancing test finds a closekin, referred to as the "less restrictive alternative " 26 doctrine, under which the court searches for alternatives available to the Government outside of statutory limits, or for "less drastic means" 27 open tothe State, that would render the statute unnecessary. In United States v. Robel , 28 legislation was assailed,

banning members of the (American) Communist Party from working in any defense facility. The U.S.Supreme Court, in nullifying the statute, held that it impaired the right of association, and that in any case,a screening process was available to the State that would have enabled it to Identify dangerous elementsholding defense positions. 29 In that event, the balance would have been struck in favor of individualliberties.

It should be noted that it is in free expression cases that the result is usually close. It is said, however, thatthe choice of the courts is usually narrowed where the controversy involves say, economic rights, 30 or asin the Levy case, military affairs, in which less precision in analysis is required and in which thecompetence of the legislature is presumed.

In no way may the ordinances at bar be said to be tainted with the vice of vagueness. It is unmistakablefrom their very provisions that the appellant falls within its coverage. As the actual operator of thefishponds, he comes within the term manager." He does not deny the fact that he financed the


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construction of the fishponds, introduced fish fries into the fishponds, and had employed laborers tomaintain them. 31 While it appears that it is the National Government which owns them, 32 theGovernment never shared in the profits they had generated. It is therefore only logical that he shouldersthe burden of tax under the said ordinances.

We agree with the trial court that the ordinances are in the character of revenue measures 33 designed toassist the coffers of the municipality of Pagbilao. And obviously, it cannot be the owner, the Government,on whom liability should attach, for one thing, upon the ancient principle that the Government is immunefrom taxes and for another, since it is not the Government that had been making money from the venture.

Suffice it to say that as the actual operator of the fishponds in question, and as the recipient of profits brought about by the business, the appellant is clearly liable for the municipal taxes in question. Hecannot say that he did not have a fair notice of such a liability to make such ordinances vague.

Neither are the said ordinances vague as to dates of payment. There is no merit to the claim that "theimposition of tax has to depend upon an uncertain date yet to be determined (three years after the'approval of the fishpond' by the Bureau of Fisheries, and upon an uncertain event (if the fishpond startedoperating before 1964), also to be determined by an uncertain individual or individuals." 34 Ordinance No.15, in making the tax payable "after the lapse of three (3) years starting from the date said fishpond isapproved by the Bureau of Fisheries," 35 is unequivocal about the date of payment, and its amendment byOrdinance No. 12, reckoning liability thereunder "beginning and taking effect from the year 1964 if thefishpond started operating before the year 1964 ," 36 does not give rise to any ambiguity. In either case,the dates of payment have been definitely established. The fact that the appellant has been allegedlyuncertain about the reckoning dates as far as his liability for the years 1964, 1965, and 1966 isconcerned presents a mere problem in computation, but it does not make the ordinances vague. Inaddition, the same would have been at most a difficult piece of legislation, which is not unfamiliar in this

jurisdiction, but hardly a vague law.

As it stands, then, liability for the tax accrues on January 1, 1964 for fishponds in operation prior thereto(Ordinance No. 12), and for new fishponds, three years after their approval by the Bureau of Fisheries(Ordinance No. 15). This is so since the amendatory act (Ordinance No. 12) merely granted amnesty untoold, delinquent fishpond operators. It did not repeal its mother ordinances (Nos. 4 and 15). With respect tonew operators, Ordinance No. 15 should still prevail.

To the Court, the ordinances in question set forth enough standards that clarify imagined ambiguities.While such standards are not apparent from the face thereof, they are visible from the intent of the saidordinances.

The next inquiry is whether or not they can be said to be ex post facto measures. The appellant argues thatthey are: "Amendment No. 12 passed on September 19, 1966, clearly provides that the payment of theimposed tax shall "beginning and taking effect from the year 1964, if the fishpond started operating

before the year 1964.' In other words, it penalizes acts or events occurring before its passage, that is tosay, 1964 and even prior thereto." 37

The Court finds no merit in this contention. As the Solicitor General notes, "Municipal Ordinance No. 4was passed on May 14, 1955. 38 Hence, it cannot be said that the amendment (under Ordinance No. 12) is

being made to apply retroactively (to 1964) since the reckoning period is 1955 (date of enactment).Essentially, Ordinances Nos. 12 and 15 are in the nature of curative measures intended to facilitate andenhance the collection of revenues the originally act, Ordinance No. 4, had prescribed. 39 Moreover, theact (of non-payment of the tax), had been, since 1955, made punishable, and it cannot be said that


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Ordinance No. 12 imposes a retroactive penalty. As we have noted, it operates to grant amnesty tooperators who had been delinquent between 1955 and 1964. It does not mete out a penalty, much less, aretrospective one.

The appellant assails, finally, the power of the municipal council of Pagbilao to tax "public forest land." 40 In Golden Ribbon Lumber Co., Inc. v. City of Butuan 41 we held that local governments' taxing power does not extend to forest products or concessions under Republic Act No. 2264, the Local Autonomy Actthen in force. (Republic Act No. 2264 likewise prohibited municipalities from imposing percentage taxeson sales.)

First of all, the tax in question is not a tax on property, although the rate thereof is based on the area of fishponds ("P3.00 per hectare" 42). Secondly, fishponds are not forest lands, although we have held themto the agricultural lands. 43 By definition, "forest" is "a large tract of land covered with a natural growth of trees and underbush; a large wood." 44 (Accordingly, even if the challenged taxes were directed on thefishponds, they would not have been taxes on forest products.)

They are, more accurately, privilege taxes on the business of fishpond maintenance. They are not chargedagainst sales, which would have offended the doctrine enshrined by Golden Ribbon Lumber , 45 but rather on occupation, which is allowed under Republic Act No. 2264. 46 They are what have been classified asfixed annual taxes and this is obvious from the ordinances themselves.

There is, then, no merit in the last objection.

WHEREFORE, the appeal is DISMISSED. Costs against the appellant.


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and that any restraint in the disclosure of such information to appropriate agencies or other judicial forawould render meaningless the relief supplied by the bank inquiry order.

Petitioner raises particular arguments questioning Lilia Chengs right to seek injunctive relief before theCourt of Appeals, noting that not one of the bank inquiry orders is directed against her. Her "crypticassertion" that she is the wife of Cheng Yong cannot, according to petitioner, "metamorphose into therequisite legal standing to seek redress for an imagined injury or to maintain an action in behalf of another." In the same breath, petitioner argues that Alvarez cannot assert any violation of the right tofinancial privacy in behalf of other persons whose bank accounts are being inquired into, particularlythose other persons named in the Makati RTC bank inquiry order who did not take any step to opposesuch orders before the courts.

Ostensibly, the proximate question before the Court is whether a bank inquiry order issued in accordancewith Section 10 of the AMLA may be stayed by injunction. Yet in arguing that it does, petitioner relies onwhat it posits as the final and immediately executory character of the bank inquiry orders issued by theManila and Makati RTCs. Implicit in that position is the notion that the inquiry orders are valid, and suchnotion is susceptible to review and validation based on what appears on the face of the orders and theapplications which triggered their issuance, as well as the provisions of the AMLA governing the issuanceof such orders. Inde ed, to test the viability of petitioners argument, the Court will have to be satisfied thatthe subject inquiry orders are valid in the first place. However, even from a cursory examination of theapplications for inquiry order and the orders themselves, it is evident that the orders are not in accordancewith law.

III.

A brief overview of the AMLA is called for.

Money laundering has been generally defined by the International Criminal Police Organization (Interpol)`as "any act or attempted act to conceal or disguise the identity of illegally obtained proceeds so that theyappear to have originated from legitimate sources. "64 Even before the passage of the AMLA, the problemwas addressed by the Philippine government through the issuance of various circulars by the BangkoSentral ng Pilipinas. Yet ultimately, legislative proscription was necessary, especially with the inclusionof the Philippines in the Financia l Action Task Forces list of non -cooperative countries and territories inthe fight against money laundering .65 The original AMLA, Republic Act (R.A.) No. 9160, was passed in2001. It was amended by R.A. No. 9194 in 2003.

Section 4 of the AMLA states that "[m]oney laundering is a crime whereby the proceeds of an unlawfulactivity as [defined in the law] are transacted, thereby making them appear to have originated fromlegitimate sources. "66 The section further provides the three modes through which the crime of moneylaundering is committed. Section 7 creates the AMLC and defines its powers, which generally relate tothe enforcement of the AMLA provisions and the initiation of legal actions authorized in the AMLA suchas civil forefeiture proceedings and complaints for the prosecution of money laundering offenses .67

In addition to providing for the definition and penalties for the crime of money laundering, the AMLAalso authorizes certain provisional remedies that would aid the AMLC in the enforcement of the AMLA.These are the "freeze order" authorized under Section 10, and the "bank inquiry order" authorized under Section 11.

Respondents posit that a bank inquiry order under Section 11 may be obtained only upon the pre-existence of a money laundering offense case already filed before the courts .68 The conclusion is based on
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the phrase "upon order of any competent court in cases of violation of this Act," the word "cases"generally understood as referring to actual cases pending with the courts.

We are unconvinced by this proposition, and agree instead with the then Solicitor General who concededthat the use of the phrase "in cases of" was unfortunate, yet submitted that it should be interpreted to mean"in the event there are violations" of the AMLA, and not that there are already cases pending in courtconcerning such violations .69 If the contrary position is adopted, then the bank inquiry order would belimited in purpose as a tool in aid of litigation of live cases, and wholly inutile as a means for thegovernment to ascertain whether there is sufficient evidence to sustain an intended prosecution of theaccount holder for violation of the AMLA. Should that be the situation, in all likelihood the AMLC would

be virtually deprived of its character as a discovery tool, and thus would become less circumspect in filingcomplaints against suspect account holders. After all, under such set-up the preferred strategy would be toallow or even encourage the indiscriminate filing of complaints under the AMLA with the hope or expectation that the evidence of money laundering would somehow surface during the trial. Since theAMLC could not make use of the bank inquiry order to determine whether there is evidentiary basis to

prosecute the suspected malefactors, not filing any case at all would not be an alternative. Suchunwholesome set-up should not come to pass. Thus Section 11 cannot be interpreted in a way that wouldemasculate the remedy it has established and encourage the unfounded initiation of complaints for moneylaundering.

Still, even if the bank inquiry order may be availed of without need of a pre-existing case under theAMLA, it does not follow that such order may be availed of ex parte. There are several reasons why theAMLA does not generally sanction ex parte applications and issuances of the bank inquiry order.

IV.

It is evident that Section 11 does not specifically authorize, as a general rule, the issuance ex parte of the bank inquiry order. We quote the provision in full:

SEC. 11. Author ity to I nquir e into Bank Deposits. Notwithstanding the provisions of Republic Act No. 1405, as amended, Republic Act No. 6426, as amended, Republic Act No.8791, and other laws, the AMLC may inquire into or examine any particular deposit or investment with any banking institution or non bank financial institution upon order of anycompetent court in cases of violation of this Act, when it has been established that there isprobable cause that the deposits or investments are related to an unlawful activity asdefined in Section 3(i) hereof or a money laundering offense under Section 4 hereof, exceptthat no court order shall be required in cases involving unlawful activities defined inSections 3(i)1, (2) and (12).

To ensure compliance with this Act, the Bangko Sentral ng Pilipinas (BSP) may inquire into or examine any deposit of investment with any banking institution or non bank financial institutionwhen the examination is made in the course of a periodic or special examination, in accordancewith the rules of examination of the BSP .70 (Emphasis supplied)

Of course, Section 11 also allows the AMLC to inquire into bank accounts without having to obtain a judicial order in cases where there is probable cause that the deposits or investments are related tokidnapping for ransom ,71 certain violations of the Comprehensive Dangerous Drugs Act of 2002 ,72 hijacking and other violations under R.A. No. 6235, destructive arson and murder. Since such specialcircumstances do not apply in this case, there is no need for us to pass comment on this proviso. Suffice it
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to say, the proviso contemplates a situation distinct from that which presently confronts us, and for purposes of the succeeding discussion, our reference to Section 11 of the AMLA excludes said proviso.

In the instances where a court order is required for the issuance of the bank inquiry order, nothing inSection 11 specifically authorizes that such court order may be issued ex parte. It might be argued thatthis silence does not preclude the ex parte issuance of the bank inquiry order since the same is not

prohibited under Section 11. Yet this argument falls when the immediately preceding provision, Section10, is examined.

SEC. 10. Freezing of Monetary Instrument or Property . The Court of Appeals, uponapplication ex parte by the AMLC and after determination that probable cause exists that anymonetary instrument or property is in any way related to an unlawful activity as defined inSection 3(i) hereof, may issue a freeze order which shall be effective immediately. The freezeorder shall be for a period of twenty (20) days unless extended by the court .73

Although oriented towards different purposes, the freeze order under Section 10 and the bank inquiryorder under Section 11 are similar in that they are extraordinary provisional reliefs which the AMLC mayavail of to effectively combat and prosecute money laundering offenses. Crucially, Section 10 usesspecific language to authorize an ex parte application for the provisional relief therein, a circumstanceabsent in Section 11. If indeed the legislature had intended to authorize ex parte proceedings for theissuance of the bank inquiry order, then it could have easily expressed such intent in the law, as it did withthe freeze order under Section 10.

Even more tellingly, the current language of Sections 10 and 11 of the AMLA was crafted at the sametime, through the passage of R.A. No. 9194. Prior to the amendatory law, it was the AMLC, not the Courtof Appeals, which had authority to issue a freeze order, whereas a bank inquiry order always thenrequired, without exception, an order from a competent court .74 It was through the same enactment that ex

parte proceedings were introduced for the first time into the AMLA, in the case of the freeze order whichnow can only be issued by the Court of Appeals. It certainly would have been convenient, through thesame amendatory law, to allow a similar ex parte procedure in the case of a bank inquiry order hadCongress been so minded. Yet nothing in the provision itself, or even the available legislative record,explicitly points to an ex parte judicial procedure in the application for a bank inquiry order, unlike in thecase of the freeze order.

That the AMLA does not contemplate ex parte proceedings in applications for bank inquiry orders isconfirmed by the present implementing rules and regulations of the AMLA, promulgated upon the

passage of R.A. No. 9194. With respect to freeze orders under Section 10, the implementing rules doexpressly provide that the applications for freeze orders be filed ex parte ,75 but no similar clearance isgranted in the case of inquiry orders under Section 11 .76 These implementing rules were promulgated bythe Bangko Sentral ng Pilipinas, the Insurance Commission and the Securities and ExchangeCommission ,77 and if it was the true belief of these institutions that inquiry orders could be issued ex

parte similar to freeze orders, language to that effect would have been incorporated in the said Rules. Thisis stressed not because the implementing rules could authorize ex parte applications for inquiry ordersdespite the absence of statutory basis, but rather because the framers of the law had no intention to allowsuch ex parte applications.

Even the Rules of Procedure adopted by this Court in A.M. No. 05-11-04-SC 78 to enforce the provisionsof the AMLA specifically authorize ex parte applications with respect to freeze orders under Section 1 079

but make no similar authorization with respect to bank inquiry orders under Section 11.
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The Court could divine the sense in allowing ex parte proceedings under Section 10 and in proscribingthe same under Section 11. A freeze order under Section 10 on the one hand is aimed at preservingmonetary instruments or property in any way deemed related to unlawful activities as defined in Section3(i) of the AMLA. The owner of such monetary instruments or property would thus be inhibited fromutilizing the same for the duration of the freeze order. To make such freeze order anteceded by a judicial

proceeding with notice to the account holder would allow for or lead to the dissipation of such funds even before the order could be issued.

On the other hand, a bank inquiry order under Section 11 does not necessitate any form of physicalseizure of property of the account holder. What the bank inquiry order authorizes is the examination of the particular deposits or investments in banking institutions or non-bank financial institutions. Themonetary instruments or property deposited with such banks or financial institutions are not seized in a

physical sense, but are examined on particular details such as the account holders record of deposits andtransactions. Unlike the assets subject of the freeze order, the records to be inspected under a bank inquiryorder cannot be physically seized or hidden by the account holder. Said records are in the possession of the bank and therefore cannot be destroyed at the instance of the account holder alone as that wouldrequire the extraordinary cooperation and devotion of the bank.

Interestingly, petitioners memorandum does not attempt to demonstrate before the Court that the bank inquiry order under Section 11 may be issued ex parte , although the petition itself did devote some spacefor that argument. The petition argues that the bank inquiry order is "a special and peculiar remedy,drastic in its name, and made necessary because of a public necessity [t]hus, by its very nature, theapplication for an order or inquiry must necessarily, be ex parte ." This argument is insufficient

justification in light of the clear disinclination of Congress to allow the issuance ex parte of bank inquiryorders under Section 11, in contrast to the legislatures clear inclination to allow the ex parte grant of freeze orders under Section 10.

Without doubt, a requirement that the application for a bank inquiry order be done with notice to theaccount holder will alert the latter that there is a plan to inspect his bank account on the belief that thefunds therein are involved in an unlawful activity or money laundering offense .80 Still, the account holder so alerted will in fact be unable to do anything to conceal or cleanse his bank account records of suspicious or anomalous transactions, at least not without the whole-hearted cooperation of the bank,which inherently has no vested interest to aid the account holder in such manner.

V.

The necessary implication of this finding that Section 11 of the AMLA does not generally authorize theissuance ex parte of the bank inquiry order would be that such orders cannot be issued unless notice isgiven to the owners of the account, allowing them the opportunity to contest the issuance of the order.Without such a consequence, the legislated distinction between ex parte proceedings under Section 10and those which are not ex parte under Section 11 would be lost and rendered useless.

There certainly is fertile ground to contest the issuance of an ex parte order. Section 11 itself requires thatit be established that "there is probable cause that the deposits or investments are related to unlawfulactivities," and it obviously is the court which stands as arbiter whether there is indeed such probablecause. The process of inquiring into the existence of probable cause would involve the function of determination reposed on the trial court. Determination clearly implies a function of adjudication on the

part of the trial court, and not a mechanical application of a standard pre-determination by some other body. The word "determination" implies deliberation and is, in normal legal contemplation, equivalent to"the decision of a court of justice. "81
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The court receiving th e application for inquiry order cannot simply take the AMLCs word that probablecause exists that the deposits or investments are related to an unlawful activity. It will have to exercise its

own determinative function in order to be convinced of such fact. The account holder would be certainlycapable of contesting such probable cause if given the opportunity to be apprised of the pendingapplication to inquire into his account; hence a notice requirement would not be an empty spectacle. Itmay be so that the process of obtaining the inquiry order may become more cumbersome or prolonged

because of the notice requirement, yet we fail to see any unreasonable burden cast by such circumstance.After all, as earlier stated, requiring notice to the account holder should not, in any way, compromise theintegrity of the bank records subject of the inquiry which remain in the possession and control of the

bank.

Petitioner argues that a bank inquiry order necessitates a finding of probable cause, a characteristic similar to a search warrant which is applied to and heard ex parte. We have examined the supposed analogy

between a search warrant and a bank inquiry order yet we remain to be unconvinced by petitioner.

The Constitution and the Rules of Court prescribe particular requirements attaching to search warrantsthat are not imposed by the AMLA with respect to bank inquiry orders. A constitutional warrant requiresthat the judge personally examine under oath or affirmation the complainant and the witnesses he may

produce ,82 such examination being in the form of searching questions and answers .83 Those areimpositions which the legislative did not specifically prescribe as to the bank inquiry order under theAMLA, and we cannot find sufficient legal basis to apply them to Section 11 of the AMLA. Simply put, a

bank inquiry order is not a search warrant or warrant of arrest as it contemplates a direct object but not theseizure of persons or property.

Even as the Constitution and the Rules of Court impose a high procedural standard for the determinationof probable cause for the issuance of search warrants which Congress chose not to prescribe for the bank inquiry order under the AMLA, Congress nonetheless disallowed ex parte applications for the inquiryorder. We can discern that in exchange for these procedural standards normally applied to searchwarrants, Congress chose instead to legislate a right to notice and a right to be heard characteristics of

judicial proceedings which are not ex parte. Absent any demonstrable constitutional infirmity, there is noreason for us to dispute such legislative policy choices.

VI.

The Courts construction of Section 11 of the AMLA is undoubtedly influenced by right to privacyconsiderations. If sustained, petitioners argument that a bank account may be inspected by thegovernment following an ex parte proceeding about which the depositor would know nothing would havesignificant implications on the right to privacy, a right innately cherished by all notwithstanding thelegally recognized exceptions thereto. The notion that the government could be so empowered is cause for concern of any individual who values the right to privacy which, after all, embodies even the right to be"let

alone," the most comprehensive of rights and the right most valued by civilized people .84

One might assume that the constitutional dimension of the right to privacy, as applied to bank deposits,warrants our present inquiry. We decline to do so. Admittedly, that question has proved controversial inAmerican jurisprudence. Notably, the United States Supreme Court in U.S. v. Mille r 85 held that there wasno legitimate expectation of privacy as to the bank records of a depositor .86 Moreover, the text of our Constitution has not bothered with the triviality of allocating specific rights peculiar to bank deposits.
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However, sufficient for our purposes, we can assert there is a right to privacy governing bank accounts inthe Philippines, and that such right finds application to the case at bar. The source of such right isstatutory, expressed as it is in R.A. No. 1405 otherwise known as the Bank Secrecy Act of 1955. Theright to privacy is enshrined in Section 2 of that law, to wit:

SECTION 2 . All deposits of whatever nature with banks or banking institutions in thePhilippines including investments in bonds issued by the Government of the Philippines, itspolitical subdivisions and its instrumentalities, are hereby considered as of an absolutelyconfidential nature and may not be examined, inquired or looked into by any person,government official, bureau or office, except upon written permission of the depositor, or in casesof impeachment, or upon order of a competent court in cases of bribery or dereliction of duty of

public officials, or in cases where the money deposited or invested is the subject matter of thelitigation. (Emphasis supplied)

Because of the Bank Secrecy Act, the confidentiality of bank deposits remains a basic state policy in thePhilippines .87 Subsequent laws, including the AMLA, may have added exceptions to the Bank SecrecyAct, yet the secrecy of bank deposits still lies as the general rule. It falls within the zones of privacyrecognized by our laws .88 The framers of the 1987 Constitution likewise recognized that bank accountsare not covered by either the right to information 89 under Section 7, Article III or under the requirement of full public disclosur e90 under Section 28, Article II .91 Unless the Bank Secrecy Act is repealed or

amended, the legal order is obliged to conserve the absolutely confidential nature of Philippine bank deposits.

Any exception to the rule of absolute confidentiality must be specifically legislated. Section 2 of the Bank Secrecy Act itself prescribes exceptions whereby these bank accounts may be examined by "any person,government official, bureau or office"; namely when: (1) upon written permission of the depositor; (2) incases of impeachment; (3) the examination of bank accounts is upon order of a competent court in casesof bribery or dereliction of duty of public officials; and (4) the money deposited or invested is the subjectmatter of the litigation. Section 8 of R.A. Act No. 3019, the Anti-Graft and Corrupt Practices Act, has

been recognized by this Court as constituting an additional exception to the rule of absoluteconfidentiality ,92 and there have been other similar recognitions as well .93

The AMLA also provides exceptions to the Bank Secrecy Act. Under Section 11, the AMLC may inquireinto a bank account upon order of any competent court in cases of violation of the AMLA, it having beenestablished that there is probable cause that the deposits or investments are related to unlawful activitiesas defined in Section 3(i) of the law, or a money laundering offense under Section 4 thereof. Further, ininstances where there is probable cause that the deposits or investments are related to kidnapping for ransom ,94 certain violations of the Comprehensive Dangerous Drugs Act of 2002 ,95 hijacking and other violations under R.A. No. 6235, destructive arson and murder, then there is no need for the AMLC toobtain a court order before it could inquire into such accounts.

It cannot be successfully argued the proceedings relating to the bank inquiry order under Section 11 of theAMLA is a "litigation" encompassed in one of the exceptions to the Bank Secrecy Act which is when "themoney deposited or invested is the subject matter of the litigation." The orientation of the bank inquiryorder is simply to serve as a provisional relief or remedy. As earlier stated, the application for such doesnot entail a full-blown trial.

Nevertheless, just because the AMLA establishes additional exceptions to the Bank Secrecy Act it doesnot mean that the later law has dispensed with the general principle established in the older law that "[a]ll
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