Statcon Chapter 3 - Contemporary Construction

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Group 1- 1st Semester 2010- 2011 [STATUTORY CONSTRUCTION / CHAPTER 3: AIDS TO CONSTRUCTION] Baquiran, Bohol, Dacuan, De Jesus, Sevilla, Villanueva AIDS TO CONSTRUCTION A. In General Generally O Meaning of statute is ambiguous - Court: all legitimate aids to construction ascertain true intent of statute O Intrinsic aids O Extrinsic aids Title O Serves as aid in case of doubt in its language, to its construction and to ascertaining legislative will O Where statute’s meaning is obscure used by courts to clear the obscurity O Can be resorted as an aid where there is doubt as to the meaning of the law or as to the intention of the legislature in enacting it, and not otherwise O Rule: the title of the statute may properly serve as guide to ascertaining legislative intent carries more weight in this jurisdiction O Constitutional requirement: “every bill shall embrace only one subject which shall be expressed in the title thereof.” (Case of City of Baguio v. Marcos) When resort to title not authorized O When the text of the statute is clear and free from doubt, it is improper to resort to its title to make it obscure Preamble O That part of the statute written immediately after its title, which states the purpose, reason or justification for the enactment of the law O Expressed in the “Whereas Clause” O Usually, omitted in statutes passed by: - Phil. Commission - Phil. Legislature - National Assembly - Congress of the Phil. - Batasang Pambansa *explanatory notes O Not an essential part of a statute O May clarify ambiguities (thus, it is the key of the statute) O May express the legislative intent to make the law apply retroactively, in which case the law has to be given retroactive effect, so as to carry such intent Context of whole text O The best source from which to ascertain the legislative intent is the statute itself – the words, phrases, sentences, sections, clauses, provisions – taken as a whole and in relation to one another O Legislative intent should accordingly be ascertained from a consideration of the whole context of the statute and not from an isolated part or particular provision O The meaning dictated by the context prevails Punctuation marks O comma, semi-colon, period 1

Transcript of Statcon Chapter 3 - Contemporary Construction

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Group 1- 1st Semester 2010-2011 [ ] Baquiran, Bohol, Dacuan, De Jesus, Sevilla, Villanueva

AIDS TO CONSTRUCTIONA. In GeneralGenerally

O Meaning of statute is ambiguous

- Court: all legitimate aids to construction ascertain true intent of statuteO Intrinsic aids

O Extrinsic aids

TitleO Serves as aid in case of doubt in its language, to its construction and to ascertaining

legislative will

O Where statute’s meaning is obscure used by courts to clear the obscurity

O Can be resorted as an aid where there is doubt as to the meaning of the law or as to the intention of the legislature in enacting it, and not otherwise

O Rule: the title of the statute may properly serve as guide to ascertaining legislative intent carries more weight in this jurisdiction

O Constitutional requirement: “every bill shall embrace only one subject which shall be expressed in the title thereof.” (Case of City of Baguio v. Marcos)

When resort to title not authorizedO When the text of the statute is clear and free from doubt, it is improper to resort to

its title to make it obscure

PreambleO That part of the statute written immediately after its title, which states the

purpose, reason or justification for the enactment of the law

O Expressed in the “Whereas Clause”

O Usually, omitted in statutes passed by:

- Phil. Commission- Phil. Legislature- National Assembly- Congress of the Phil.

- Batasang Pambansa *explanatory notes

O Not an essential part of a statute

O May clarify ambiguities (thus, it is the key of the statute)

O May express the legislative intent to make the law apply retroactively, in which case the law has to be given retroactive effect, so as to carry such intent

Context of whole textO The best source from which to ascertain the legislative intent is the statute itself –

the words, phrases, sentences, sections, clauses, provisions – taken as a whole and in relation to one another

O Legislative intent should accordingly be ascertained from a consideration of the whole context of the statute and not from an isolated part or particular provision

O The meaning dictated by the context prevails

Punctuation marksO comma, semi-colon, period

O Aids of low degree and can never control against the intelligible meaning of written words

O An ambiguity in a statute which may be partially or wholly solved by a punctuation mark may be considered in the construction of the statute

Capitalization of lettersO An aid of low degree in the construction of a statute

Headnotes and Epigraphs• Convenient index to the contents of statute provisions

• Can never control plain terms of the enacting clauses, for they are not part of the law

• Where the text of the statute is clear, there is neither necessity nor propriety to resort to the headings or epigraphs especially where they are mere catchwords or reference.

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• They cannot have the effect of limiting the operative words contained in the body of text.

• Thus, the word “another” in the heading of ART 160 of the RPC which states in part : Commission of another crime during service of penalty imposed for another previous offense XXX cannot limit the text of the article to mean that it is applicable only when the new crime committed is different from which the accused is serving sentence and not when the new and old crimes are of the same kind, for such deduction is not warranted by the plain and unambiguous language of the text

Lingual Text• Filipino laws are officially promulgated either in English , Spanish or Filipino, or in

two such language

• Where a statute is promulgated in English and Spanish, English text shall govern

• Promulgated in Spanish or English or in Filipino, with translation to other languages, language in which it is written prevails

• e. i. Revised Penal Code

Intent or spirit of law• Intent or spirit of law is the law itself.

• The spirit, rather than the letter, of the statute determines its construction

• What is in the spirit is within the statute although it is not within the letter and what is in the letter but not within the spirit is not within the statute.

• If legislative intent or spirit is not expressed in some appropriate manner, the courts cannot by interpretation speculate as to an intent and supply a meaning not found in the phrase

Policy Law• Once ascertained should be given effect by the judiciary

• One way of accomplishing this mandate is to give a statute of doubtful meaning, a construction that will promote public policy

• A construction which would carry into effect the evident policy of the law should be adopted in favour of which would defeat it

Purpose of Law or Mischief to be suppressed• Important factor to be considered

• Statute derives its vitality from the purpose for which it is enacted

• Where a statute lays down a general rule with exceptions, the purpose of the general rule is not determinative of the construction to be given to the exceptions.

Dictionaries• courts may consult the dictionaries, legal, scientific, or general as aid

• while definition given by lexicographers are not binding, courts have adopted , in proper cases , such definition to support their conclusion as to meaning of the particular words or terms , especially when no strong reason exist why their dictionary meaning should not be adopted

• Generally define words in their natural, plain ordinary acceptance and significance

• Where the law does not define the words used in a statute and the legislature has not intended a technical or special legal meaning, the courts may adopt the ordinary meaning as defined in the dictionaries

PresumptionsThey are based on logic, experience and common sense, and in the absence of compelling reason to the contrary, doubt as to the proper and correct construction of the statute will be resolved in favor of the construction which is in accord with the presumption on the matterPresumption include

• Constitutionality of the statute

• Completeness

• Prospective operation

• Right and justice

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LEGISLATIVE HISTORY

What constitutes LH?

It includes:- President’s message if the bill is enacted in response thereto,- The explanatory note accompanying the bill- Committee reports of legislative investigations- Public hearings on the subject of the bill- Sponsorship speech- Debates and deliberations concerning the bill- Amendments and changes in phraseology in which it undergoes before final approval thereof.- If the statute is based or a revision of, a prior statute, the latter’s practical application and judicial construction

- The various amendments it underwent- Contemporary events at the time of its enactment.

President’s MessageO “President shall address the Congress at the opening of its regular session. He may

also appear before it at any other time.”O Usually contains proposed legislative measures.O Indicates his thinking on the proposed legislation which when enacted into law,

follows his line of thinking on the matter.

Explanatory NoteO It is a short exposition or explanation accompanying a proposed legislation by its

author or proponent.O It contains statements of the reason or purpose of the bill, as well as the arguments

advanced by its author in urging its passage.O It may be used as a basis for giving a statute a meaning that is inconsistent with

what is expressed in the text of the statute.

Debates and DeliberationsO Courts may avail themselves of the actual proceedings of the legislative body to

assist in determining the construction of a statute of doubtful meaning.O However, the views expressed therein are not controlling in the interpretation of

the law.O Opinions of legislators are also not given decisive weight.

Reports of CommissionsO Commissions are usually formed to compile and collate all laws on a particular

subject and to prepare the draft of the proposed code.

Prior law which the statute is basedO In ascertaining the intention of the lawmaker, courts are permitted to look to prior

laws on the same subject and to investigate the antecedents of the statutes involved.

Illustration: People v. Manantan O Facts O - A justice of peace was prosecuted for violation of Sec. 54 of the old

Revised Election Code which provides that “no justice, judge, fiscal, treasurer, or assessor of any province xxx shall aid any candidate or exert any influence in any election or take part therein except to vote xxx.”

O - He claims that the provision was taken from Sec. 449 of the Revised Administrative Code, which provided that “No judge of the First Instance, justice of the peace, or treasurer, fiscal or assessor of any province xxx shall aid any candidate xxx.”

O - Sec. 54 omitted “justice of peace”, omission revealed the intention of the legislature to exclude justice of peace from its operation.

O Issue O Whether a justice of peace is included in the prohibition contained in Sec.

54 of the old Revised Election Code?O Held O Court held that the word “judge” includes “justice of peace, and said that

a “review of the history of the Revised Election Code will help justify and clarify the conclusion.”

O Court noted those prohibited from engaging in partisan political activities under the first election law, Act No. 1582 and C.A. No. 357. The legislative history shows that in the two instances the words “justice of peace” were omitted in the latter, the word “judge” did not carry qualification of the phrase “of first instance.”

O In other words, whenever the word “judge” was qualified by the phrase “of first instance,” the words “justice of peace” were omitted.

O This indicates that the legislature did not exclude said officer from the operation of the law and that it is considered comprehended in the generic and broad term “judge.”

Change in PhraseologyO Indicates the legislative intent to change the meaning of the provision from that it

originally had.O Changes made by the legislature in the form of amendments to a statute should be

given effect, together with other parts of the amended act.

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Illustration: Commissioner of Customs v. CTA

The insertion of the word “national” before “port”, clearly indicates a change in the meaning

Amendment by deletion

O Indicates that the legislature intended to change the meaning of the statute, for the presumption is that the legislature would not have made the deletion had the intention been not to effect a change in its meaning.

O The amended statute should accordingly be given a construction different from that previous to its amendment.

Illustration: Gloria v. CA

Whether the suspend public officer or employee is entitled to his salary and other benefits during the suspension period.

The Court resolve that Sec. 35 of the Old Civil Service act was amended by deleting the provision regarding payment of salaries during suspension.

Exceptions

• Rule: amendment of a statute indicates a change in meaning from that which the statute originally had applies only when the deleted words or phrases are not surplusage or when the intention is clear to change the previous meaning of the old law.

• The rule does not apply where the intent, as shown by the history of the enactment, is clear that the amendment is precisely to plainly express the construction of the act prior to its amendment because its language is not sufficiently expressive of such construction.

• Words which do not materially affect the sense will be omitted from the statute

Adopted statutes:Foreign statutes which are adopted in this country or from which local laws are patterned form part of the legislative history of the latter.General rule: Where local statutes are patterned after or copied from those of another country, the decisions of the courts in such country construing those laws are

entitled to great weight in the interpretation of such local statutes generally followed

o if found reasonable and in harmony with justice, public policy and other local statutes in the subject

Reason: Legislature, in adopting from another country a statute which has previously received judicial construction in that country, is deemed to have adopted the statute with such construction and practical application in the country of origin.

A good number of Philippine Laws are adopted from the United States (or individual states of the American Union) such as:

corporation law tax code labor laws naturalization law Rules of court

Hence, the Philippine courts have found themselves “bound by the rulings of the Supreme Court of the United States in construing and applying statutory enactments modeled upon or borrowed from English or American originals.”Example: Rules of evidence, mainly drawn from American decisions, the decisions of American courts, have persuasive effect.Rule of Estoppel.

Limitations to the rule of adopted statutesThe presumption that the foreign construction was adopted with the adoption of the foreign statute no longer obtains:

Where the local law and the foreign statute from which the former was patterned differ in some material aspects

Where the foreign construction is clearly erroneous or has or become settled Where the adopting state has given the statute its own interpretation

Reason: Philippine rules must necessarily be construed in accordance with the intention of its lawmakers and such intention may be deduced from the language of each law and the context of other legislation related thereto.

Court ruling of Republic of the Philippines v. Meralco: American decisions and authorities are not per se controlling in this jurisdiction American decisions are persuasive but our laws must be construed accordance with

the intention of our own lawmakers Construction must serve our own public interest

o Be-all and the end-all of all our laws Rate regulations call for:

o Careful consideration of the totality of facts and circumstances material to each application for an upward rate revision

Principles of common lawCommon law

- Also known as Anglo-American jurisprudence4

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- Not in force in this country - But because of enactment of laws and establishment of institutions similar to

the United States, courts may find it applicable provided that:o It is founded on sound principles applicable to local conditionso Not in conflict with existing lawso Construing the doubtful provisions in statutes, modeled upon Anglo-

American precedents

Conditions at the time of enactmentStatutes do not operate in a vacuum.In enactment of the statute, legislature is presumed to have taken into account the existing conditions of things at the time.Therefore, the interpretation should consider the physical conditions of the country and the circumstances then obtaining which must of necessity affect its operation in order to reach an understanding as to the intent of the legislature, or the meaning of the statute.

History of the times- History of the times out of which it grew and to which it may be rationally

supposed to bear some direct relationship, the evils intended to be remedied, and the good to be accomplished are proper subjects of inquiry.

- “Law being a manifestation of social culture and progress, must be interpreted taking into consideration the stage of such circumstances. It must be interpreted taking into consideration the stage of such culture and progress including all the concomitant circumstances.”

- Inspiration from all sources from which may spring guidance and help to form a truthful idea of the human relations regulated by the law to be interpreted and applied:o Teachings of history, from precedents and traditionso Inventions of scienceo Discoveries of artso Ideals of thinkerso Dreams of poets

C. Contemporary ConstructionGenerally - Contemporary or practical constructions are

- Constructions placed upon statutes at the time of, or after, their enactment by the executive, legislature, or judicial authorities, as well as by those who, because of their involvement in the process of legislation, are knowledgeable of the intent and the purpose of the law, such as draftsmen and bill sponsors.

- Invaluable aid in the construction, by the courts of ambiguous or doubtful provisions of law.

- Contemporanca expositio est optima et fortissimo in lege – the contemporary construction is strongest in the law

Executive construction- Construction placed upon the statute by an executive or administrative officer

called upon to execute or administer such statute- Executive or administrative officers are generally the very first officials to interpret

the law, preparatory to its enforcemento Interpretations are in the form of rules and regulations, circulars,

directives, opinions and rulingso 3 Types of Executive Interpretations of the Law

1. Construction by an executive or administrative officer directly called to implement the law.

Expressed interpretation o interpretation embodied in a circular,

directive or regulation Implied interpretation

o practice or mode of enforcement not applying the statute to certain situations or applying it in a particular manner

o interpretation by usage or practice 2. Construction by the Secretary of Justice in his/her capacity as

chief legal adviser of the government. Form of opinions issued upon request of

administrative or executive officials who enforce the law

In the absence of judicial ruling on the matter and unless reprobated by the President, the opinions of the Secretary of Justice are generally controlling among administrative and executive officials of the government.

The President of the Executive Secretary, by the authority of the President, has the power to modify, alter or reverse the construction of a statute given by a department secretary.

3. Interpretation handed down in an adversary proceeding in the form of a ruling by an executive officer exercising quasi-judicial power.

Court ruling distinguishing an interpretation by an executive officer charged with the enforcement of a law vs. that of handed down by an executive official in and adversary proceeding:

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o “There is indeed basis for making such distinction because the position of a public officer, charged with the enforcement of the law, is different from the one who must decide a dispute. If there is a fair doubt, his duty is to present the case for the side which he represents, upon which lies the responsibility of decision. If he surrenders a plausible construction, it will, at least it may, be surrendered forever, and yet it may be right. Such rulings need not have the detachment of a judicial or semi-judicial decision, and may properly carry bias. It would seem that they should not be authoritative.”

Weight accorded to contemporaneous construction- Where there is doubt in the interpretation of a statute, the uniform construction is

placed upon it by the executive or administrative officer charged with its enforcement will be adopted.

- Contemporaneous construction is the true expression of legislative purposeo Especially if the construction is followed for a considerable period of time

- Entitled to great weight and respect by the courts in the interpretation of ambiguous provisions of the law

o Unless shown to be clearly erroneous, it will control the interpretation of statutes by the courts

o Rule: In the absence of error and abuse of power or lack of jurisdiction or grave abuse of discretion clearly conflicting with either the letter of the spirit of a legislative enactment creating or charging a governmental agency, the action of the agency would not be disturbed by courts.

o Reason: as explained in Nestlé Philippines, Inc. v. Court of Appeals1. Emergence of multifarious needs of a modern or modernizing

society and the establishment of diverse administrative agencies for addressing and satisfying those needs

2. Accumulation of experience and growth of specialized capabilities by the administrative agency charged with implementing a particular statute.

3. Government agency or officials charged with the implementation of the law, their competence, expertness, experience and informed judgment, and the fact that they frequently are the drafters of the law they interpret.

o Example: Philippine Sugar Central v. Collector of Customs1. Facts: For the last 26 years, wharfage duties have been levied

and collected even during the period when the government never owned nor operated any wharf. The court is called upon to overthrow that long continued construction and in legal effect to hold that, because the sugar was shipped through a privately owned wharf, the government is not entitled to collect the money in question ‘as a charge for wharfage.’

2. Issue: Whether the government can legally collect duties “as a charge for wharfage” required by a statute upon articles exported through privately-owned wharves.

3. Held: The court sustained the law because of the long acquiescence in its construction and the far reaching effect of such a decision. Moreover, the very fact that the Congress has not seen it fit to repeal or change the law is a very potent argument in favor of sustaining that construction. In view of its history, its long continuous construction, and what has been done under it, the court believed that the government is entitled to have and receive the money in question, even though the sugar was shipped from a private wharf.

Weight accorded to usage and practice- Great value is placed in determining a statute’s meaning, especially where the

usage has been acquiesced in by all parties concerned and has extended over a long period of time.

- Optimus interpres rerum usus- the best interpreter of law is usage

Construction of Rules & Regulations

Rules and regulations issued by executive or administrative officers pursuant to, and as authorized by, law have the force and effect of laws.

It has been held that an administrative agency has the power to interpret its own rules & such interpretation becomes part of the rules

Why Contemporaneous Construction is given much weight

It comes from a particular branch of government called upon to implement the law thus construed.

The respect due the government agency or officials charged with the implementation of the law, their competence, expertness, experience, & informed judgment, & the fact that they frequently are the drafters of the law they interpret.

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There is need for certainty and predictability in the law.Illustrative ExampleCemco Holdings Inc vs National Life Insurance Co.

Facts: Union Cement Corporation (UCC), a publicly-listed company, has two principal stockholders – UCHC, a non-listed company, with shares amounting to 60.51%, & petitioner Cemco with 17.03%. Majority of UCHC’s stocks were owned by BCI with 21.31% & ACC with 29.69% Cemco, on the other hand, owned 9% of UCHC stocks. In a disclosure letter dated July 5, 2004, BCI informed the Phil Stock Exchange (PSE) that it & its subsidiary ACC had passed resolutions to sell to Cemco BCI’s stocks in UCHC equivalent to 21.31% & ACC’s stocks in UCHC equivalent to 29.69%. In the PSE Circular for Brokers No. 3146-2004 dated July 8 2004, it was stated that as a result of petitioner Cemco’s acquisition of BCI & ACC’s shares in UCHC, petitioner’s total beneficial ownership, direct and indirect, in UCC has increased by 36% & amounted to at least 53% of the shares of UCC. As a consequence of this disclosure, the PSE, in a letter to the SEC dated July 15, 2004, inquired as to whether the Tender Offer Rule under Rule 19 of the Implementing Rules of the Securities Regulation Code is not applicable to the purchase by petitioner of the majority of shares of UCC.

July 16, 2004: Thru a letter, Dir. Justina Callangan confirmed that the SEC en banc has resolved that the Cemco transaction was not covered by the tender offer rule.

July 28, 2004: Feeling aggrieved by the transaction, respondent National Life Insurance Company of the Phil, Inc., a minority stockholder of UCC, sent a letter to Cemco demanding the latter to comply with the rule on mandatory tender offer. Cemco, however, refused.

August 5, 2004: a Share Purchase Agreement was executed by ACC & BCI, as sellers, & Cemco, as buyer.

August 12, 2004: the transaction was consummated & closed.August 19, 2004: respondent National Life Insurance Company of the Phil, Inc. filed a complaint with the SEC asking it to reverse its July 27 2004 Resolution & to declare the purchase agreement of Cemco void & praying that the mandatory tender offer rule must be applied to its UCC shares. Impleaded in the complaint were Cemco, UCC, UCHC, BCI, & ACC, which were then required by the SEC to file their respective comment on the complaint. In their comments, they were uniform in arguing that the tender offer rule applied only to a direct acquisition of the shares of the listed company & did not extend to an indirect acquisition arising from the purchase of the shares of a holding company of the listed firm.

February 14, 2005: In its decision, the SEC ruled in favor of the respondent by reversing & setting aside its July 27 2004 Resolution & directed petitioner Cemco to

make a tender offer for UCC shares to respondent & other holders of UCC shares similar to the class held by UCHC in accordance with Section 9 (E), Rule 19 of the Securities Regulation Code.

Petitioner filed a petition with the Court of Appeals challenging the SEC’s jurisdiction to take cognizance of respondent’s complaint & its authority to require Cemco to make a tender offer for UCC shares, & arguing that the tender offer rule does not apply, or that the SEC’s re-interpretation of the rule could not be made to retroactively apply to Cemco’s purchase of UCHC shares. The Court of Appeals rendered a decision affirming the ruling of the SEC. It ruled that the SEC has jurisdiction to render the questioned decision and, in any event, Cemco was barred by estoppel from questioning the SEC’s jurisdiction. It, likewise, held that the tender offer requirement under the Securities Regulation Code & its Implementing Rules applies to Cemco’s purchase of UCHC stocks. Cemco filed a motion for reconsideration which was denied by the CA. Hence the instant petition.

Issues:1. Whether or not the SEC has jurisdiction over respondent’s complaint & to require Cemco to make a tender offer for respondent’s UCC shares.2. Whether or not the rule on mandatory tender offer applies to the indirect acquisition of shares in a listed company, through its purchase of the shares in UCHC, a non-listed company.3. Whether or not the questioned ruling of the SEC can be applied retroactively to Cemco’s transaction which was consummated under the authority of the SEC’s prior resolution

Held: The rule in this jurisdiction is that the construction given to a statute by an administrative agency charged with the interpretation & application of that statute is entitled to great weight by the courts, unless such construction is clearly shown to be in sharp contrast with the governing law or statute. The rationale for this rule relates not only to the emergence of the multifarious needs of a modern or modernizing society & the establishment of diverse administrative agencies for addressing & satisfying those needs; it also relates to accumulation of experience & growth of specialized capabilities by the administrative agency charged with implementing a particular statute.

When Contemporaneous Construction is disregarded

No ambiguity in the law Where the construction is clearly erroneous Where strong reason to the contrary exists Where the court has previously given the statute a different interpretation

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It is the role of the judiciary to define & when necessary, to correct constitutional or statutory interpretation in the context of the interaction of the three branches of the government, almost always in situations where some agency of the state has engaged in action that stems ultimately from some legitimate area of government power.

Erroneous Contemporaneous Construction does not preclude correction nor create rights, exceptions

The doctrine of estoppel does not preclude correction of the erroneous construction by the officer himself, by his successor in office, or by the court in an appropriate case.

As a rule, an erroneous contemporaneous construction creates no vested right on the part of those who relied upon, & followed, such construction

Not absolute – tax cases

Legislative Interpretation

The fact that the interpretation of a statute is primarily a judicial function does not preclude the legislature from indicating its construction of a statute it enacts into law

Interpretative or declaratory clause It may also define the terms used in a statute, enact a declaratory act construing a

previous law, or pass a resolution indicating its sense or intention as to a given statute.

Legislative interpretation may likewise take the form of an implied acquiescence to, or approval of, an executive or judicial construction of a statute.

While legislative interpretation of a statute is not controlling, courts may resort to it to clarify ambiguity in the language thereof.

Legislative Approval

Ways when approval may manifest: When it reenacts statute previously given a contemporaneous construction When it amends a prior statute without providing anything without which would

restrict, change, or nullify the previous contemporaneous construction Uses words similar in their import to the language of an earlier law which has

received a practical interpretation Ratiohabitio Mandati Aequiparatur – Ratification is equivalent to a mandate

Reenactment Most common act of approval Based on the principle that the reenactment of a statute, previously given a

contemporaneous construction is a persuasive indication of the adoption by the legislature of the prior construction

To make the principle of reenactment applicable, the earlier law must have been reenacted & not merely amended & the contemporaneous construction thereof must be in the form of regulation to implement the law & duly published & not merely administrative ruling embodied in a letter to a specified individual & not published.

Illustrative ExampleCommissioner of Internal Revenue vs American Express

Facts: American Express is a Phil Branch of American Express Int with office in Makati City. The branch is engaged primarily to facilitate the collections of Amex HK receivables for card members in the Philippines. On April 13, 1999 respondent filed with the BIR a letter-request for the refund of its 1997 excess input taxes in the amount of P3,751,067.04 which amount was arrived at after deducting from its total input VAT paid of P3,763,000.43.

Issue: Whether or not the CA committed reversible error in holding that respondent is entittled to the refund of the amount of P3,352,406.59 allegedly representing excess input VAT for the year 1997.

Held: Petition is unmeritorious. Under Sec 12 (b) VAT on sale of services (Input taxes on domestic purchases of taxable goods and services related to zero-related revenues are available as tax refund in accordance with Sec 106 (now Sec 112) of the Tax Code & Sec8(a) of Revenue Regulations No 5-87

Stare Decisis

Stare decisis et non quieta movere – one should follow past precedents and should not disturb what has been settled.

Having stability in the law The Supreme Court has the constitutional duty not only of interpreting & applying

the law in accordance with prior doctrines but also of protecting society from the improvidence & wantonness wrought by needless upheavals in such interpretations & applications.

Interest Reipublicae Ut Sit Finis Litium – Public interest requires that by the very nature of things there must be an end to a legal controversy or litigation

Must be a direct ruling

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Rulings that are merely sub silentio are merely obiter dictum*sub silentio – under silence; without any notice being taken.*obiter dictum – an opinion expressed by the court upon some question of law which is not necessary to the decision of the case before it.

Not absoluteIllustrative ExampleTung Chin Hui vs Rodrguez

O Synopsis: On November 15 1998, Tung Chin Hui, a Taiwanese citizen, was arrested by several policemen, who subsequently turned him over to the Bureau of Immigration & Deportation. Thereafter, on November 25, 1998, the BID Board of Commissioners, after finding him guilty of possessing a tampered passport earlier canceled by Taiwanese authorities, ordered his summary deportation. Petitioner filed before the RTC of Manila a petition for habeas corpus on the ground that his detention was illegal. After respondents filed a return of writ controverting his claim, the trial court issued a decision granting the petition & ordering his release from custody. Respondents filed a motion of reconsideration, but the same was denied by the trial court, Respondents then filed a notice of appeal from the judgment of the RT. Petitioner filed an opposition claiming that the notice had been filed beyond the 48-hour reglementary period for filing appeals in habeas corpus cases as prescribed by the pre-1997 Rules of Court. In an order dated February 18, 1999, the RTC rejected petitioner’s contention & ranted due course to the notice of appeal. Petitioner filed a motion for reconsideration but the same was denied. Hence, this petition questioning the granting of the appeal by the RTC

Held: The petition is not meritorious. The Court ruled that the appeal of 48 hours, as prescribed in Section 18, Rule 41 of the pre-1997 Rules of Court, was omitted & thereby repealed by the 1997 Revised Rules of Court, which completely replaced Rules 1 to 71. The well settled rule of statutory construction is that provisions of an old law that were not reproduced in the revision thereof covering the same subject are deemed repealed & discarded. The omission showed the intention of the Supreme Court to abrogate those provisions of the old laws that are not reproduced in the revised statute or code. Clearly then, the reglementary period for filing an appeal in a habeas corpus case is now similar to that in ordinary civil action & is governed by Section 3, Rule 41 of the 1997 Rules of Court.

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