PolLaw1_People vs Rosenthal.doc
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Political Law 1 Case Digest| People v Rosenthal | Delegation of Powers 10 July 2013 PEOPLE vs. Rosenthal FACTS Osmena and Rosenthal are founders and shareholders of the ORO Oil Company which was engaged in mining, refining, marketing, buying and selling petroleum, natural gas and other oil products They are alleged to have violated the ACT 2581: BLUE SKY LAW – by selling shares / speculative securities without first obtaining the written permit or license from the Insular Treasurer. The shares are said to be speculative because their value materially depended upon a promise of future promotion and development of the oil business, rather than based on actual tangible assets. RTC: found them guilty. On appeal, they assail the constitutionality of the law, that it contravenes the constitutional provisions of the JONES ACT because the law constitutes UNDUE DELEGATION OF LEGISLATIVE POWERS to the INSULAR TREASURER. Under the Blue Sky Law, all persons who offer to sell securities to the public must obtain license from the Insular Treasurer. The license to sell is issued only whenever the IT is satisfied that the applicant has complied with the provisions of the BSL. Furthermore, the BSL provides that the Insular Treasurer shall have authority, whenever in his judgment it is in the public interest , to cancel said license or permit. Osmena and Rosenthal argue however that the Blue Sky Law provides NO STANDARD or RULE which can guide the Insular Treasurer in determining the cases in which a certificate or permit ought to be issued or cancelled, thereby making his opinion the sole criterion. Consequently, they argue, legislative powers have been unduly delegated to the Insular Treasurer. ISSUE: Whether or not there was undue delegation of legislative powers. SC RULING: PUBLIC INTEREST in this case is a sufficient standard to guide the Insular Treasurer. There is no undue delegation of authority since there is a stated criterion – public interest. It is a mistaken assumption that this is a mere general reference to public welfare without any standard to guide determinations. 1. THE PURPOSE OF THE ACT, 2. THE REQUIREMENTS IMPOSED, and 3. THE CONTEXT OF THE PROVISIONS All show that there is a stated criterion. Also, the decisions of the Insular Treasurer is appealable to the Secretary of Finance, hence the IT does not act and decide without any restraining influence.
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Transcript of PolLaw1_People vs Rosenthal.doc
Political Law 1Case Digest| People v Rosenthal | Delegation of Powers10 July 2013
PEOPLE vs. Rosenthal
FACTS
Osmena and Rosenthal are founders and shareholders of the ORO Oil Company which was engaged in mining, refining, marketing, buying and selling petroleum, natural gas and other oil products
They are alleged to have violated the ACT 2581: BLUE SKY LAW – by selling shares / speculative securities without first obtaining the written permit or license from the Insular Treasurer.
The shares are said to be speculative because their value materially depended upon a promise of future promotion and development of the oil business, rather than based on actual tangible assets.
RTC: found them guilty. On appeal, they assail the constitutionality of the law, that it contravenes the constitutional provisions of the
JONES ACT because the law constitutes UNDUE DELEGATION OF LEGISLATIVE POWERS to the INSULAR TREASURER.
Under the Blue Sky Law, all persons who offer to sell securities to the public must obtain license from the Insular Treasurer. The license to sell is issued only whenever the IT is satisfied that the applicant has complied with the provisions of the BSL.
Furthermore, the BSL provides that the Insular Treasurer shall have authority, whenever in his judgment it is in the public interest, to cancel said license or permit.
Osmena and Rosenthal argue however that the Blue Sky Law provides NO STANDARD or RULE which can guide the Insular Treasurer in determining the cases in which a certificate or permit ought to be issued or cancelled, thereby making his opinion the sole criterion. Consequently, they argue, legislative powers have been unduly delegated to the Insular Treasurer.
ISSUE: Whether or not there was undue delegation of legislative powers.
SC RULING:
PUBLIC INTEREST in this case is a sufficient standard to guide the Insular Treasurer. There is no undue delegation of authority since there is a stated criterion – public interest. It is a mistaken assumption that this is a mere general reference to public welfare without any standard to guide determinations.
1. THE PURPOSE OF THE ACT,
2. THE REQUIREMENTS IMPOSED, and
3. THE CONTEXT OF THE PROVISIONS
All show that there is a stated criterion.
Also, the decisions of the Insular Treasurer is appealable to the Secretary of Finance, hence the IT does not act and decide without any restraining influence.
Upon the other hand, the authority of the Insular Treasurer to cancel a certificate or permit is expressly conditioned upon a finding that such cancellation "is in the public interest." In view of the intention and purpose of Act No. 2581 — to protect the public against "speculative schemes which have no more basis than so many feet of blue sky" and against the "sale of stock in fly-by-night concerns, visionary oil wells, distant gold mines, and other like fraudulent exploitations", — we incline to hold that "public interest" in this case is a sufficient standard to guide the Insular Treasurer in reaching a decision on a matter pertaining to the issuance or cancellation of certificates or permits.
In this connection, we cannot overlook the fact that the Act No. 2581 allows an appeal from the decision of the Insular Treasurer to the Secretary of Finance. Hence, it cannot be contended that the Insular Treasurer can act and decide without any restraining influence.
This Court had upheld "public welfare" and "public interest," respectively, as sufficient standards for a valid delegation of the authority to execute the law. But, the doctrine laid down in this case as all judicial pronouncements must be construed in relation to the specific facts and issues involved therein, outside of which they do not constitute precedents and have no binding effect. The Rosenthal case referred to the authority of the Insular Treasurer, under Act No. 2581, to issue and cancel certificates or permits for the sale of speculative securities. This case involved grants to administrative officers of powers related to the exercise of their administrative functions, calling for the determination of questions of fact.
