Islamic Dawah Council of the Phil., Inc. vs. Office of the Executive Secretary, 405 SCRA 497 (2003)FACTS: Petitioner IDCP, a corporation that operates under DSWD, is a non-governmental organization that extends voluntary services to the Filipino people, especially to Muslim communities. Among its functions is to conduct seminars, orient manufacturers on halal food and issue halal certifications to qualified products and manufacturers.In 2001, respondent Office of the Executive Secretary issued EO 46 creating the Philippine Halal Certification Scheme and designating respondent OMA to oversee its implementation. Under the EO, respondent OMA has the exclusive authority to issue halal certificates and perform other related regulatory activities. OMA warned Muslim consumers to buy only products with its official halal certification since those without said certification had not been subjected to careful analysis and therefore could contain pork or its derivatives.IDCP contends that the subject EO violates the constitutional provision on the separation of Church and State because said scheme is a function only religious organizations, entity or scholars can lawfully and validly perform for the Muslims. A food product becomes halal only after the performance of Islamic religious ritual and prayer. Thus, only practicing Muslims are qualified to slaughter animals for food. A government agency like herein respondent OMA cannot therefore perform a religious function like certifying qualified food products as halal.ISSUE: WON OMA violated the clause on non-establishment and free exercise of religion of Article III, Section 5 of the 1987 Constitution?RULING: Yes. Classifying a food product as halal is a religious function because the standards used are drawn from the Quran and Islamic beliefs. By giving OMA the exclusive power to classify food products as halal, EO 46 encroached on the religious freedom of Muslim organizations like herein petitioner to interpret for Filipino Muslims what food products are fit for Muslim consumption. Also, by arrogating to itself the task of issuing halal certifications, the State has in effect forced Muslims to accept its own interpretation of the Quran and Sunnah on halal food.Only the prevention of an immediate and grave danger to the security and welfare of the community can justify the infringement of religious freedom. If the government fails to show the seriousness and immediacy of the threat, State intrusion is constitutionally unacceptable. The State must minimize its interference with the affairs of its citizens and instead allow them to exercise reasonable freedom of personal and religious activity.

Alejandro Estrada Vs. Soledad S. Escritor, A.M. No. P-02-165, June 22, 2006FACTS: Alejandro Estrada requested Judge Jose F. Caoibes, Jr., presiding judge of Branch 253, Regional Trial Court of Las Pias City, for an investigation of respondent Soledad Escritor, court interpreter in said court, for living with a man not her husband, and having borne a child within this live-in arrangement. Estrada believes that the immoral act tarnishes the image of the court, thus she should not be allowed to remain employed therein as it might appear that the court condones her act. Consequently, respondent was charged with committing disgraceful and immoral conduct under the Revised Administrative Code.Escritor admitted the facts. But as a member of the religious sect known as the Jehovahs Witnesses and the Watch Tower and Bible Tract Society, she asserted that their conjugal arrangement is in conformity with their religious beliefs and has the approval of her congregation. In fact, after ten years of living together, she executed on July 28, 1991, a Declaration of Pledging Faithfulness. For Jehovahs Witnesses, the Declaration allows members of the congregation who have been abandoned by their spouses to enter into marital relations. The Declaration thus makes the resulting union moral and binding within the congregation all over the world except in countries where divorce is allowed. Moreover, the Jehovahs congregation believes that once all legal impediments for the couple are lifted, the validity of the declarations ceases, and the couple should legalize their union.ISSUE: WON the right to religious freedom may be invoked even if the act is immoralRULING: Yes. In resolving claims involving religious freedom (1) benevolent neutrality or accommodation, whether mandatory or permissive, is the spirit, intent and framework underlying the religion clauses in our Constitution; and (2) in deciding respondents plea of exemption based on the Free Exercise Clause (from the law with which she is administratively charged), it is the compelling state interest test, the strictest test, which must be applied.In this case, the governments conduct may appear innocent and nondiscriminatory but in effect, it is oppressive to the minority. Thus, substantive equalitya reading of the religion clauses which leaves both politically dominant and the politically weak religious groups equal in their inability to use the government (law) to assist their own religion or burden othersmakes the most sense in the interpretation of the Bill of Rights, a document designed to protect minorities and individuals from mobocracy in a democracy (the majority or a coalition of minorities).

The Constitution adheres to the benevolent neutrality approach that gives room for accommodation of religious exercises as required by the Free Exercise Clause. Thus, in arguing that respondent should be held administratively liable as the arrangement she had was illegal per se because, by universally recognized standards, it is inherently or by its very nature bad, improper, immoral and contrary to good conscience, the Solicitor General failed to appreciate that benevolent neutrality could allow for accommodation of morality based on religion, provided it does not offend compelling state interests.Finally, even assuming that the OSG has proved a compelling state interest, it has to further demonstrate that the state has used the least intrusive means possible so that the free exercise is not infringed any more than necessary to achieve the legitimate goal of the state, i.e., it has chosen a way to achieve its legitimate state end that imposes as little as possible on religious liberties. Again, the Solicitor General utterly failed to prove this element of the test. Other than the two documents offered as cited above which established the sincerity of respondents religious belief and the fact that the agreement was an internal arrangement within respondents congregation, no iota of evidence was offered. In fact, the records are bereft of even a feeble attempt to procure any such evidence to show that the means the state adopted in pursuing this compelling interest is the least restrictive to respondents religious freedom.Thus, we find that in this particular case and under these distinct circumstances, respondent Escritors conjugal arrangement cannot be penalized as she has made out a case for exemption from the law based on her fundamental right to freedom of religion.

Eliseo F. Soriano Vs. Ma. Consoliza P. Laguardia etc., G.R. No. 164785/G.R. No. 165636, April 29, 2009FACTS:Petitioner, Soriano, as host of the program Ang Dating Daan, aired on UNTV 37, made the following remarks:Lehitimong anak ng demonyo; sinungaling;Gago ka talaga Michael, masahol ka pa sa putang babae o di ba. Yung putang babae ang gumagana lang doon yung ibaba, [dito] kay Michael ang gumagana ang itaas, o di ba! O, masahol pa sa putang babae yan. Sabi ng lola ko masahol pa sa putang babae yan. Sobra ang kasinungalingan ng mga demonyong ito.[1] x x xThe show was suspended for 3 months, in accordance with the IRR of MTRCB. Soriano seeks to nullify and set aside an order and a decision of the MTRCB in connection with certain utterances he made in his television show, Ang Dating Daan. Soriano contends the notion of religious freedom, submitting that what he uttered was religious speech, adding that words like putang babae were said in exercise of his religious freedom.ISSUE: WON the utterances made by Soriano in the TV show were in exercise of his religious freedomRULING: No, it is not within Sec. 5, Article III of the 1987 Constitution on religious freedom because there is nothing in petitioners statements subject of the complaints expressing any particular religious belief, nothing furthering his avowed evangelical mission. Plain and simple insults directed at another person cannot be elevated to the status of religious speech.Soriano was moved by anger and the need to seek retribution, not by any religious conviction.His claim, assuming its veracity, that some INC ministers distorted his statements respecting amounts Ang Dating Daan owed to a TV station does not convert the foul language used in retaliation as religious speech.They simply illustrate that petitioner had descended to the level of name-calling and foul-language discourse. Petitioner could have chosen to contradict and disprove his detractors, but opted for the low road.

Villavicencio vs. Lukban, 39 Phil. 778 (1919)FACTS: The Mayor of the city of Manila, Justo Lukban, to exterminate vice, ordered the closure of the segregated districts of Manila against prostitutes. One hundred seventy women (170) were kept confined to their houses in the district by the police. The city authorities quietly perfected arrangements with the Bureau of Labor, the Constabulary, and other government office to send the women to Davao, Mindanao, as laborers. The women were given no opportunity to collect their belongings, and apparently were under the impression that they were being taken to a police station for an investigation. They had no knowledge that they were destined for a life in Mindanao and were not asked if they wished to depart from that region and had neither directly nor indirectly given their consent to the deportation.ISSUE: WON the women were illegally restrained of their liberty by Justo Lukban, Mayor of the city of Manila, Anton Hohmann, chief of police of the city of Manila, and by certain unknown parties.

RULING: Yes. A writ of habeas corpus is applicable in restraint of liberty. The essential object and purpose of the writ is to inquire into all manner of involuntary restraint as distinguished from voluntary, and to relieve a person therefrom if such restraint is illegal. Any restraint which will preclude freedom of action is sufficient. The forcible taking of these women from Manila by officials of that city, who handed them over to other parties, who deposited them in a distant region, deprived these women of freedom of locomotion just as effectively as if they had been imprisoned. Placed in Davao without either money or personal belongings, they were prevented from exercising the liberty of going when and where they pleased. The restraint of liberty which began in Manila continued until the aggrieved parties were returned to Manila and released or until they freely and truly waived his right.

G.R. No. L-62100 May 30, 1986RICARDO L. MANOTOC, JR., petitioner, vs. THE COURT OF APPEALS, HONS. SERAFIN E. CAMILON and RICARDO L. PRONOVE, JR., as Judges of the Court of First Instance of Rizal, Pasig branches, THE PEOPLE OF THE PHILIPPINES, the SECURITIES & EXCHANGE COMISSION, HON. EDMUNDO M. REYES, as Commissioner of Immigration, and the Chief of the Aviation Security Command (AVSECOM), respondents.FACTS: Petitioner Ricardo L. Manotoc, Jr., is one of the two principal stockholders of Trans-Insular Management, Inc. and the Manotoc Securities, Inc., a stock brokerage house. Following the "run" on stock brokerages caused by stock broker Santamaria's flight from this jurisdiction, petitioner, who was then in the United States, came home, and together with his co-stockholders, filed and was granted by the Securities and Exchange Commission the appointment of a management committee, not only for Manotoc Securities, Inc., but likewise for Trans-Insular Management, Inc.Pending disposition of the SEC Case, the Securities and Exchange Commission requested the Commissioner of Immigration not to clear petitioner for departure.When a Torrens title submitted to and accepted by Manotoc Securities, Inc. was suspected to be a fake, six of its clients filed six separate criminal complaints against petitioner and one Raul Leveriza, Jr., as president and vice-president, respectively, of Manotoc Securities, Inc.In due course, corresponding criminal charges for estafa were filed. In all cases, petitioner has been admitted to bail.

On March 1, 1982, Manotoc filed before each of the trial courts a motion entitled, "motion for permission to leave the country," stating as ground therefor his desire to go to the United States, "relative to his business transactions and opportunities."ISSUE: WON a person facing a criminal indictment and provisionally released on bail have an unrestricted right to travel?RULING: No. A court has the power to prohibit a person admitted to bail from leaving the Philippines. This is a necessary consequence of the nature and function of a bail bond.Rule 114, Section 1 of the Rules of Court defines bail as the security required and given for the release of a person who is in the custody of the law, that he will appear before any court in which his appearance may be required as stipulated in the bail bond or recognizance.Its object is to relieve the accused of imprisonment and the state of the burden of keeping him, pending the trial, and at the same time, to put the accused as much under the power of the court as if he were in custody of the proper officer, and to secure the appearance of the accused so as to answer the call of the court and do what the law may require of him.The condition imposed upon petitioner to make himself available at all times whenever the court requires his presence operates as a valid restriction on his right to travel.

G.R. Nos. 99289-90 January 27, 1993MIRIAM DEFENSOR-SANTIAGO, petitioner, vs. CONRADO M. VASQUEZ, Ombudsman; GUALBERTO J. DE LA LLANA, Special Prosecutor; SANDIGANBAYAN and REGIONAL TRIAL COURT OF MANILA, respondents.FACTS: A case was filed against Defensor-Santiago with the Sandiganbayan for alleged violation of Section 3(e), Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act. An order of arrest was issued with bail for the release of the accused fixed at P15,000.00.Defensor-Santiago seeks leave from the Court due to her suffering of extensive physical injuries as a result of a vehicular collision and that she is posting bail. She was authorized by the Sandiganbayan to post a cash bond for her provisional liberty without need for her physical appearance until June 5, 1991 at the latest, unless by that time her condition does not yet permit her physical appearance before said court.

In a later motion, Defensor-Santiago asked that her cash bond be cancelled and that she be allowed provisional liberty upon a recognizance. She contended that for her to continue remaining under bail bond may imply to other people that she has intentions of fleeing, an intention she would like to prove as baseless.Later, the Sandiganbayan issued an order deferring: (a) the arraignment of petitioner until further advice from the Supreme Court; and (b) the consideration of herein petitioner's motion to cancel her cash bond until further initiative from her through counsel.The Supreme Court rendered a decision dismissing the petition for certiorari and lifting and setting aside the temporary restraining order previously issued. The motion for reconsideration filed by petitioner was eventually denied with finality.Meanwhile, a hold departure order was issued by reason of the announcement made by petitioner, which was widely publicized in both print and broadcast media, that she would be leaving for the United States to accept a fellowship supposedly offered by the John F. Kennedy School of Government at Harvard University. Petitioner likewise disclosed that she would be addressing Filipino communities in the United States in line with her crusade against election fraud and other aspects of graft and corruption.ISSUE: WON the right to travel can be validly impairedRULING: No. There is no sufficient justification for the impairment of her constitutional right to travel; and that under Section 6, Article III of the 1987 Constitution, the right to travel may be impaired only when so required in the interest of national security, public safety or public health, as may be provided by law.

G.R. Nos. 115132-34 August 9, 1995IMELDA R. MARCOS, petitioner, vs. THE HONORABLE SANDIGANBAYAN (First Division) and the PEOPLE OF THE PHILIPPINES,respondents.FACTS: Petitioner, former First Lady and widow of former President Ferdinand E. Marcos, is the defendant in several criminal cases for violations of the Anti Graft and Corrupt Practices Act (R.A. No. 3019) now pending in the Sandiganbayan and in the regular courts.In two of these cases, petitioner was found guilty by the First Division of the Sandiganbayan of violating 3(g) of the Anti Graft and Corrupt Practices Act (R.A. No. 3019) and was sentenced to suffer in each case imprisonment for an indeterminate period of 9 years and 1 day as minimum to 12 years and 10 days as maximum, with perpetual disqualification from public office. Petitioner filed a motion for reconsideration, which is pending resolution in the Sandiganbayan.After her conviction in the two cases, petitioner filed several "Motion for Leave to Travel Abroad" to seek diagnostic tests and treatment by practitioners of oriental medicine allegedly because of "a serious and life threatening medical condition" requiring facilities not available in the Philippines.She seeks to travel to the People's Republic of China and to places including the United States and Europe, "if necessary," for treatment of "hypertensive heart disease, uncontrolled angina pectoris, and anterior myocardial infarction." It was alleged that the tests needed were not available in the Philippines.The motion was supported by Ambulatory BP Reports, Nuclear Medicine Reports and Computed Tomography Scan Results prepared by her physician and cardiologist, Dr. Roberto V. Anastacio, and other doctors at the Makati Medical Center.ISSUE: WON the motion for leave to travel abroad should be granted.RULING: The Court was unable to determine whether the respondent court trifled with petitioner's constitutionally guaranteed right to life, health and liberty.It is matter of record that on three different occasions, petitioner had been permitted to travel abroad. But her later conviction in two cases dictated the need for greater caution. To be sure, conviction is not yet final view of a motion for reconsideration filed by petitioner. But a person's right to travel is subject to the usual contraints imposed by the very necessity of safeguarding the system of justice. In such cases, whether the accused should be permitted to leave the jurisdiction for humanitarian reason is a matter of the court's sound discretion.This motion should be addressed to the Sandiganbayan not only because whether petitioner should be allowed to leave the country is its primary concern but also because the determination of petitioner's eye condition is question of fact to be made in the first instance by the Sandiganbayan. The court should order a joint examination of petitioner's eye condition and resolve her motion accordingly.

[G.R. No. 141529. June 6, 2001]FRANCISCO YAP, JR., a.k.a. EDWIN YAP, petitioner, vs. COURT OF APPEALS and the PEOPLE OF THE PHILIPPINES, respondents.

FACTS: For misappropriating amounts equivalent to P5,500,000.00, petitioner was convicted of estafa. He filed a notice of appeal, and moved to be allowed provisional liberty under the cash bond he had filed earlier in the proceedings. The motion was denied by the trial court.Petitioner filed with the CA a Motion to Fix Bail For the Provisional Liberty of Accused-Appellant Pending Appeal. The Solicitor General opined that petitioner may be allowed to post bail in the amount of P5,500,000.00 and be required to secure a certification/guaranty from the Mayor of the place of his residence that he is a resident of the area and that he will remain to be so until final judgment is rendered or in case he transfers residence, it must be with prior notice to the court and private complainant. Petitioner filed a Reply, contending that the proposed bail of P5,500,000.00 was violative of his right against excessive bail.ISSUE: WON the right against excessive bail, and the liberty of abode and travel, can be invoked to set aside two resolutions of the Court of Appeals which fixed bail at P5,500,000.00 and imposed conditions on change of residence and travel abroad.RULING: Yes. The courts are precluded from installing devices to ensure against the jumping of bail which may include increasing the bail bond to an appropriate level, or requiring the person to report periodically to the court and to make an accounting of his movements. Although an increase in the amount of bail while the case is on appeal may be meritorious, the amount of P5,500,000.00 is unreasonable, excessive, and constitutes an effective denial of petitioners right to bail. The purpose for bail is to guarantee the appearance of the accused at the trial, or whenever so required by the court. The amount should be high enough to assure the presence of the accused when required but no higher than is reasonably calculated to fulfill this purpose.To fix bail at an amount equivalent to the civil liability of which petitioner is charged (in this case, P5,500,000.00) is to permit the impression that the amount paid as bail is an exaction of the civil liability that accused is charged of; this we cannot allow because bail is not intended as a punishment, nor as a satisfaction of civil liability which should necessarily await the judgment of the appellate court. In the present case, where petitioner was found to have left the country several times while the case was pending, the Court of Appeals required the confiscation of his passport and the issuance of a hold-departure order against him. Under the circumstances of this case, we find that appropriate conditions have been imposed in the bail bond to ensure against the risk of flight, particularly, the combination of the hold-departure order and the requirement that petitioner inform the court of any change of residence and of his whereabouts.

G.R. No. 71169 December 22, 1988JOSE D. SANGALANG and LUTGARDA D. SANGALANG, petitioners, FELIX C. GASTON and DOLORES R. GASTON, JOSE V. BRIONES and ALICIA R. BRIONES, and BEL-AIR VILLAGE ASSOCIATION, INC.,intervenors-petitioners, vs. INTERMEDIATE APPELLATE COURT, and AYALA CORPORATION, respondents.FACTS: Appellant-spouses were residing in Jupiter Street and in Bel-Air Village.The parties admit that at the time Moncal purchased the subject property from the Makati Development Corporation, there was a perimeter wall, running along Jupiter Street, which wall was constructed by the subdivision owner; that at that time the gates of the entrances to Jupiter Street were closed to public traffic. In short, the entire length of Jupiter which was inside the perimeter wall was not then open to public traffic. Subsequent thereto, Ayala tore down the perimeter wall to give way to the commercial building fronting Buendia Avenue (now Gil J. Puyat Avenue).On August 12, 1977, the Mayor of Makati forcibly opened and removed the street gates constructed on Jupiter Street and Reposo Street, thereby opening said streets to the public.ISSUE: WON non-impairment of contracts may be invokedRULING: No, it is only secondary to general welfare. It is not that restrictive easements, especially the easements herein in question, are invalid or ineffective. As far as the Bel-Air subdivision itself is concerned, certainly, they are valid and enforceable. But they are, like all contracts, subject to the overriding demands, needs, and interests of the greater number as the State may determine in the legitimate exercise of police power. Our jurisdiction guarantees sanctity of contract and is said to be the "law between the contracting parties, but while it is so, it cannot contravene 'law, morals, good customs, public order, or public policy. Above all, it cannot be raised as a deterrent to police power, designed precisely to promote health, safety, peace, and enhance the common good, at the expense of contractual rights.The petitioners have not shown why the Court should hold otherwise other than for the supposed "non-impairment" guaranty of the Constitution, which, as we have declared, is secondary to the more compelling interests of general welfare. The Ordinance has not been shown to be capricious or arbitrary or unreasonable to warrant the reversal of the judgments so appealed. In that connection, we find no reversible error to have been committed by the Court of Appeals.

G.R. No. 132269. April 27, 2000]HARRISON MOTORS CORPORATION, petitioner, vs. RACHEL A. NAVARRO, respondent.FACTS: Sometime in June of 1987 Harrison Motors Corporation through its president, Renato Claros, sold two (2) Isuzu Elf trucks assembled using imported component parts to private respondent Rachel Navarro, owner of RN Freight Lines, a franchise holder operating and maintaining a fleet of cargo trucks all over Luzon. Prior to the sale, Claros represented to Navarro that all the BIR taxes and customs duties for the parts used on the two (2) trucks had been paid for.Thereafter, the BIR, BOC and LTO entered into a tripartite MOA which provided that prior to the registration in the LTO of any locally assembled motor vehicle using imported component parts, a Certificate of Payment should first be obtained from the BIR and the BOC to prove that all existing taxes and customs duties have been paid.Thus, government agents seized and detained the two (2) Elf trucks of Navarro after discovering that there were still unpaid BIR taxes and customs duties thereon and also ordered Navarro to pay the proper assessments or her trucks would be impounded.Navarro went to Claros to ask for the payment of BIR taxes and customs duties; however, Claros refused to comply. Thus, Navarro was forced to pay but demanded a reimbursement from Claros, in which she was again ignored and filed a complaint.Ghe trial court rendered a decision ordering Claros to reimburse Navarro in the amount of P32,943.00 for the customs duties and internal revenue taxes the latter had to pay to discharge her two (2) Elf trucks from government custody. Harrison Motors argued that it was no longer obliged to pay for the additional taxes and customs duties imposed on the imported component parts since such administrative regulations only took effect after the execution of its contract of sale with private respondent.ISSUE: WON the MOAs impaired the contract entered into by Navarro and ClarosRULING: No. What Sec. 10, Art. III, of the Constitution prohibits is the passage of a law which enlarges, abridges or in any manner changes the intention of the contracting parties. The Memorandum Orders and the two (2) Memoranda of Agreement do not impose any additional taxes which would unduly impair the contract of sale between petitioner and private respondent. Instead, these administrative regulations were passed to enforce payment of existing BIR taxes and customs duties at the time of importation.

The records however reveal that the Memorandum Orders and Memoranda of Agreement do not impose any additional BIR taxes or customs duties. It does not charge any new tax. It simply provides the procedure on how owners/consignees or their purchasers could voluntarily initiate payment for any unpaid customs duties on locally assembled vehicles using imported component parts.

[G.R. No. 126102. December 4, 2000]ORTIGAS & CO. LTD., petitioner, vs. THE COURT OF APPEALS and ISMAEL G. MATHAY III, respondents.FACTS: Ortigas & Company sold to Emilia Hermoso, a parcel of land in Greenhills Subdivision IV, San Juan, Metro Manila. The contract of sale provided that the lot: be used exclusivelyfor residential purposes only, and not more than one single-family residential building will be constructed thereon,No single-family residential building shall be erecteduntil the building plans, specificationhave been approved by the SELLER. In 1981, the Metropolitan Manila Commission (now MMDA) enacted MMC Ordinance No. 81-01 or the Comprehensive Zoning Area for the National Capital Region. The ordinance reclassified as a commercial area a portion of Ortigas Avenue from Madison to Roosevelt Streets of Greenhills Subdivision where the lot is located.The subject property was leased by Ismael Mathay III from Hermoso. Thereupon, Mathay constructed a single story commercial building for Greenhills Autohaus, Inc., a car sales company. Later, Ortigas Co. filed a complaint against Emilia Hermoso seeking the demolition of the said commercial structure for having violated the terms and conditions of the Deed of Sale.Mathay III then filed for certiorari with the CA claiming that MMC Ordinance No. 81-01 classified the area where the lot was located as commercial area and said ordinance must be read into the August 25, 1976 Deed of Sale as a concrete exercise of police power. Ortigas and Company averred that inasmuch as the restrictions on the use of the lot were duly annotated on the title it issued to Emilia Hermoso, said restrictions must prevail over the ordinance, specially since these restrictions were agreed upon before the passage of MMC Ordinance No. 81-01.ISSUE: Whether or not the MMC Ordinance No. 81-01 be applied retroactively and enacted in the exercise of police power be superior to non-impairment of contractsRULING: Yes. SC affirmed the decision of CA in which the zoning ordinance be applied retroactively and superior to the non-impairment of contracts. Although the Court agrees that laws should be applied with prospectivity, lex prospicit, non respicit, and such is also applicable at the time of the execution of contracts, unless specified in the statutes to have a retroactive effect. A later law that changes the intent of parties to the contract impairs the contract itself, thereby violating the Constitution.However, one of the exceptions to this is police power that regulates certain activities that can be given retroactive effect and may reasonably impair vested rights or contracts. Police power is superior to non-impairment of contracts as it promotes health, morals, peace, education, good order, safety, and general welfare of the people.

[G.R. No. 139256. December 27, 2002]REPUBLIC OF THE PHILIPPINES, represented by Sugar Regulatory Administration, petitioner, vs. SULPICIO TANCINCO,respondent.FACTS: The National Sugar Trading Corporation (NASUTRA), a domestic corporation created for the purpose of engaging in the trading of sugar, and a subsidiary of the Philippine Sugar Commission (Philsucom), an entity owned and controlled by the Philippine government, leased the warehouse of Sulpicio Tancinco in Cagayan de Oro City. The contract was for a period of 3 months starting November 23, 1984 renewable for another 3 years.On December 29, 1984, the eastern wall of the warehouse collapsed causing death and injuries to several persons and damage to houses within the area. Tancinco was constrained to incur expenses for the repair and restoration of the warehouse and indemnity for the victims. Due to NASUTRAs refusal to reimburse Tancinco, he filed a complaint for Damages. NASUTRA filed its Answer disclaiming any liability.In the meantime, NASUTRA was converted into a private corporation called the Philippine Sugar Marketing Corporation (Philsuma), the sole marketing agency for the sugar industry to be owned completely by sugar producers. Thereafter, Philsucom was phased out by Executive Order No. 18 in 1986, at same time creating petitioner SRA. NASUTRA substituted petitioner SRA and filed on February 8, 1988, an Answer putting up the defenses that it cannot be liable for NASUTRAs obligation as it was created after the incident took place and that it is a separate and distinct entity from the former. On May 17, 1990, respondent Tancinco died and he was substituted by his heirs.

ISSUE: WON there was an impairment of contractRULING: No. Indeed, Executive Order No. 18 abolished the Philippine Sugar Commission (Philsucom) and created the Sugar Regulatory Administration (SRA). However, the abolition of NASUTRA and eventually Philsucom did not abate the pendency of the suits filed against them. The termination of the life of a juridical entity does not by itself cause the extinction or diminution of the rights and liabilities of such entity; specially in this case where, pursuant to the transitory provision of E.O. No. 18, Philsucom, under the supervision of SRA, was allowed to continue as a juridical entity for 3 years for the purpose of prosecuting and defending suits by or against it and enabling it to settle and close its affairs, to dispose of and convey its property; and to distribute its assets.Accordingly, SRA can be held liable for Tancincos claim for damages against NASUTRA, which claim has already been proven before the trial court.