EN BANC[G.R. No. L-3708. May 18, 1953.]ROYAL L. RUTTER, plaintiff-appellant, vs. PLACIDO J. ESTEBAN, defendant-appellee.Susano A. Velasquez for appellant.Teodoro R. Dominguez for appellee.SYNOPSIS1.CONSTITUTIONAL LAW; OBLIGATIONS AND CONTRACTS; MORATORIUM; LIMITATIONS UPON THE POLICE POWER OF THE STATE. "Although conceding that the obligations of the mortgage contract were impaired, the court decided that what it thus described as an impairment was, notwithstanding the contract clause of the Federal Constitution, within the police power of the State as that power was called into exercise by the public economic emergency which the legislature had found to exist." (Home Building & Loan Association vs. Bleisdell, 290 U. S., 398.) But the ruling in the Bleisdell case has its limitations which should not be overlooked in the determination of the extent to be given to the legislation which attempts to encroach upon the enforcement of a monetary obligation; if these bounds are transgressed, there is no room for the exercise of the power, for the constitutional inhibition against the impairment of contracts would assert itself. Here are instances by which these bounds may be transgressed: (1) The impairment should only refer to the remedy and not to a substantive right (Worthen Co. vs. Kavanaugh, 79 L. ed., 1298, 1301-1303; Bronson vs. Kinsie, 1 How., 311, 317, 46 Har. Law Review, p. 1070); (2) The protective power of the state, the police power, may only be invoked and justified by an emergency, temporary in nature, and can only be exercised upon reasonable conditions in order that it may not infringe the constitutional provision against impairment of contracts (First Trust Co. of Lincoln vs. Smith, 27 N. W., pp. 762, 769); (3) "A different situation is presented when extensions are so piled up as to make the remedy a shadow . . ." (Worthen vs. Kavanaugh, 295 U. S., 56, 62); (4) The decision in the Bleisdell case is predicated on the ground that the laws altering existing contracts will constitute an impairment of the contract clause of the Constitution only if they are unreasonable in the light of the circumstances occasioning their enactment (47 Harvard Law Review, p. 660).2.ID.; ID.; ID.; WHEN EXTENSIONS OF PERIOD OF MORATORIUM BECOME UNREASONABLE. The obligations covered by Republic Act No. 342 and Executive Orders Nos. 25 and 32 had been pending since 1945 and would continue to be unenforceable during the eight-year period granted to prewar debtors to afford them an opportunity to rehabilitate themselves, which in plain language means that the creditors would have to observe a vigil of at least twelve years before they could effect a liquidation of their investment dating as far back as 1941. This period seems unreasonable, if not oppressive. While the purpose of Congress is plausible, and should be commended, the relief accorded works injustice to creditors who are practically left at the mercy of the debtors. Their hope to effect collection becomes extremely remote, more so if the credits are unsecured. And the injustice is more patent when, under the law, the debtor is not even required to pay interest during the operation of the relief. There are at least three cases where the Supreme Court of the United States declared the moratorium laws violative of the contract clause of the Constitution because the period granted to debtors as a relief was found unwarranted by the contemplated emergency (Worthen Co. vs. Thomas, 292 U. S., 426-435, 78 L. ed., 1344, 1347; Worthen vs. Kavanaugh, 295 U. S., 56; Louisville Joint Stock Land Bank vs. Radford, 295 U. S., 555, 79 L. ed., 1593).3.ID.; ID.; ID.; REPUBLIC ACT No. 342 AND EXECUTIVE ORDERS Nos. 25 AND 32 ARE UNCONSTITUTIONAL. The continued operation and enforcement of Republic Act No. 342 at the present time is unreasonable and oppressive, and should not be prolonged a minute longer, and, therefore, the same is declared null and void and without effect. And what is said here with respect to said Act holds true as regards Executive Orders Nos. 25 and 32, perhaps with greater force and reason as to the latter, considering that said Orders contain no limitation whatsoever in point of time as regards the suspension of the enforcement and effectivity of monetary obligations. And there is need to make this pronouncement in view of the revival clause embodied in said Act if and when it is declared unconstitutional or invalid.D E C I S I O NBAUTISTA ANGELO, J p:On August 20, 1941, Royal L. Rutter sold to Placido J. Esteban two parcels of land situated in the City of Manila for the sum of P9,600 of which P4,800 were paid outright, and the balance of P4,800 was made payable as follows: P2,400 on or before August 7, 1942, and P2,400 on or before August 27, 1943, with interest at the rate of 7 per cent per annum.To secure the payment of said balance of P4,800, a first mortgage over the same parcels of land has been constituted in favor of the plaintiff. The deed of sale having been registered, a new title was issued in favor of Placido J. Esteban with the mortgage duly annotated on the back thereof.Placido J. Esteban failed to pay the two installments as agreed upon, as well as the interest that had accrued thereon, and so on August 2, 1949, Royal L. Rutter instituted this action in the Court of First Instance of Manila to recover the balance due, the interest due thereon, and the attorney's fees stipulated in the contract. The complaint also contains a prayer for the sale of the properties mortgaged in accordance with law.Placido J. Esteban admitted the averments of the complaint, but set up as a defense the moratorium clause embodied in Republic Act No. 342. He claims that this is a prewar obligation contracted on August 20, 1941; that he is a war sufferer, having filed his claim with the Philippine War Damage Commission for the losses he had suffered as a consequence of the last war; and that under section 2 of said Republic Act No. 342, payment of his obligation cannot be enforced until after the lapse of eight years from the settlement of his claim by the Philippine War Damage Commission, and this period has not yet expired.After a motion for summary judgment has been presented by the defendant, and the requisite evidence submitted covering the relevant facts, the court rendered judgment dismissing the complaint holding that the obligation which plaintiff seeks to enforce is not yet demandable under the moratorium law. Plaintiff filed a motion for reconsideration wherein he raised for the first time the constitutionality of the moratorium law, but the motion was denied. Hence this appeal.The only question to be determined hinges on the validity of Republic Act No. 342 which was approved by Congress on July 26, 1948. It is claimed that this act if declared applicable to the present case is unconstitutional being violative of the constitutional provision forbidding the impairment of the obligation of contracts (Article III, section 1, Constitution of the Philippines).Section 2 of Republic Act No. 342 provides that all debts and other monetary obligations contracted before December 8, 1941, any provision in the contract creating the same or in any subsequent agreement affecting such obligation to the contrary notwithstanding, shall not be due and demandable for a period of eight (8) years from and after settlement of the war damage claim of the debtor by the Philippine War Damage Commission; and section 3 of said Act provides that should the provision of section 2 be declared void and unenforceable, then as regards the obligation affected thereby, the provisions of Executive Order No. 25 dated November 18, 1944, as amended by Executive Order No. 32, dated March 10, 1945, relative to debt moratorium, shall continue to be in force and effect, any contract affecting the same to the contrary notwithstanding, until subsequently repealed or amended by a legislative enactment. It thus clearly appears in said Act that the nullification of its provisions will have the effect of reviving the previous moratorium orders issued by the President of the Philippines.Statutes declaring a moratorium on the enforcement of monetary obligations are not of recent enactment. These moratorium laws are not new. "For some 1,400 years western civilization has made use of extraordinary devices for saving the credit structure, devices generally known as moratoria. The moratorium is a postponement of fulfillment of obligations decreed by the state through the medium of the courts or the legislature. Its essence is the application of the sovereign power" (58 C. J. S., p. 1208, footnote 87). In the United States, many state legislatures have adopted moratorium laws "during times of financial distress, especially when incident to, or caused by, a war" (41 C. J., p. 213). Thus, such laws "were passed by many state legislatures at the time of the civil war suspending the rights of creditors for a definite and reasonable time, . . . whether they suspend the right of action or make dilatory the remedy" (12 C. J., p. 1078). These laws were declared constitutional. However, some courts have also declared that "such statutes are void as to contracts made before their passage where the suspension of remedies prescribed is indefinite or unreasonable in duration" (12 C. J., 1078). The true test, therefore, of the constitutionality of a moratorium statute lies in the determination of the period of suspension of the remedy. It is required that such suspension be definite and reasonable, otherwise it would be violative of the constitution.One of the arguments advanced against the validity of the moratorium law is the fact that it impairs the obligation of contracts which is prohibited by the Constitution. This argument, however, does not now hold water. While this may be conceded, it is however justified as a valid exercise by the State of its police power. The leading case on the matter is Home Building and Loan Association vs. Bleisdell, 290 U. S., 398, decided by the Supreme Court of the United States on January 8, 1934. Here appellant contested the validity of charter 339 of the laws of Minnesota of 1933, approved April 13, 1933, called the Minnesota Mortgage Moratorium Law, as being repugnant to the contract clause of the Federal Constitution. The statute was sustained by the Supreme Court of Minnesota as an emergency measure. "Although conceding that the obligations of the mortgage contract were impaired, the court decided that what it thus described as an impairment was, notwithstanding the contract clause of the Federal Constitution, within the police power of the State as that power was called into exercise by the public economic emergency which the legislature had found to exist". This theory was upheld by the Supreme Court. Speaking through Chief Justice Hughes, the court made the following pronouncements:"Not only is the constitutional provision qualified by the measure of control which the State retains over remedial processes, but the State also continues to possess authority to safeguard the vital interest of its people. It does not matter that legislation appropriate to that end 'has the result of modifying or abrogating contracts already in effect.' . . . Not only are existing laws read into contracts in order to fix obligations as between the parties, but the reservation of essential attributes of sovereign power is also read into contracts as a postulate of the legal order. The policy of protecting contracts against impairment presupposes the maintenance of a government by virtue of which contractual relations are worth while, a government which retains adequate authority to secure the peace and good order of society. This principle of harmonizing the constitutional prohibition with the necessary residuum of state power has had progressive recognition in the decisions of this court."xxx xxx xxx"The economic interests of the State may justify the exercise of its continuing and dominant protective power notwithstanding interference with contracts. . . . "xxx xxx xxx"Similarly, where the protective power of the State is exercised in a manner otherwise appropriate in the regulation of a business it is no objection that the performance of existing contracts may be frustrated by the prohibition of injurious practices. . . . "" . . . The question is not whether the legislative action affects contracts incidentally, or directly or indirectly, but whether the legislation is addressed to a legitimate end and the measures taken are reasonable and appropriate to that end. . . . "xxx xxx xxx"Undoubtedly, whatever is reserved of state power must be consistent with the fair intent of the constitutional limitation of that power. The reserved power cannot be construed so as to destroy the limitation, nor is the limitation to be construed to destroy the reserved power in its essential aspects. They must be construed in harmony with each other. This principle precludes a construction which would permit the State to adopt as its policy the repudiation of debts or the destruction of contracts or the denial of means to enforce them. But it does not follow that conditions may not arise in which a temporary restraint of enforcement may be consistent with the spirit and purpose of the constitutional provision and thus be found to be within the range of the reserved power of the State to protect the vital interests of the community. It cannot be maintained that the constitutional prohibition should be so construed as to prevent limited and temporary interpositions with respect to the enforcement of contracts if made necessary by a great public calamity such as fire, flood, or earthquake. See American Land Co. vs. Zeiss, 219 U. S. 47, 55 L. ed. 82, 31 S. Ct. 200. The reservation of state power appropriate to such extraordinary conditions may be deemed to be as much a part of all contracts, as is the reservation of state power to protect the public interest in the other situation to which we have referred. And if state power exists to give temporary relief from the enforcement of contracts in the presence of disasters due to physical causes such as fire, flood or earthquake, that power cannot be said to be nonexistent when the urgent public need demanding such relief is produced by other and economic causes" (78 L. ed. 426, 428-429.)This decision elicited several comments. One came from the Harvard Law Review. It said: "Forsaking its well-trodden path of more than a century, the court sustained the first of the new mortgage moratory laws to meet its scrutiny, and in so doing announced an elastic concept of the contract clause which, if not newly formulated, at least received such unequivocal expression that it bids fair to revolutionize a tradition of constitutional interpretation. . . . The court rested its decision on the ground that laws altering existing contracts constitute an impairment within the meaning of the contract clause only if they are unreasonable in the light of the circumstances occasioning their enactment. Application of this 'rule of reason' was justified on the theory that all contracts are made subject to an implied reservation of the protective power of the state, and that therefore statutes which validly exercise this reserved power, rather than impairing the obligations of an existing contract, are comprehended within them" (47 Harvard Law Review, pp. 660, 661-662).But the ruling in the Blaisdell case has its limitations which should not be overlooked in the determination of the extent to be given to the legislation which attempts to encroach upon the enforcement of a monetary obligation. It must be noted that the application of the reserved power of the State to protect the integrity of the government and the security of the people should be limited to its proper bounds and must be addressed to a legitimate purpose. If these bounds are transgressed, there is no room for the exercise of the power, for the constitutional inhibition against the impairment of contracts would assert itself. We can site instances by which these bounds may be transgressed. One of them is that the impairment should only refer to the remedy and not to a substantive right. The State may postpone the enforcement of the obligation but cannot destroy it by making the remedy futile (W. B. Worthen Co. vs. Kavanaugh, 79 L. ed. 1298, 1301-1303). Another limitation refers to the propriety of the remedy. The rule requires that the alteration or change that the new legislation desires to write into an existing contract must not be burdened with restrictions and conditions that would make the remedy hardly pursuing (Bronson vs. Kinziel, I How, 311, 317; 46 Har. Law Review, p. 1070). In other words, the Blaisdell case postulates that the protective power of the State, the police power, may only be invoked and justified by an emergency, temporary in nature, and can only be exercised upon reasonable conditions in order that it may not infringe the constitutional provision against impairment of contracts (First Trust Co. of Lincoln vs. Smith, 277 N. W., pp. 762, 769). As Justice Cardozo aptly said, "A different situation is presented when extensions are so piled up as to make the remedy a shadow . . . The changes of remedy now challenged as invalid are to be viewed in combination, with the cumulative significance that each imparts to all. So viewed they are seen to be an oppressive and unnecessary destruction of nearly all the incidents that give attractiveness and value to collateral security (W. B. Worthen vs. Kavanaugh, 295 U. S. 56, 62). In fine, the decision in the Blaisdell case is predicated on the ground that the laws altering existing contracts will constitute an impairment of the contract clause of the Constitution only if they are unreasonable in the light of the circumstances occasioning their enactment (47 Harvard Law Review, p. 660).The question now to be determined is, is the period of eight (8) years which Republic Act No. 342 grants to debtors of a monetary obligation contracted before the last global war and who is a war sufferer with a claim duly approved by the Philippine War Damage Commission reasonable under the present circumstances?It should be noted that Republic Act No. 342 only extends relief to debtors of prewar obligations who suffered from the ravages of the last war and who filed a claim for their losses with the Philippine War Damage Commission. It is therein provided that said obligation shall not be due and demandable for a period of eight (8) years from and after settlement of the claim filed by the debtor with said Commission. The purpose of the law is to afford to prewar debtors an opportunity to rehabilitate themselves by giving them a reasonable time within which to pay their prewar debts so as to prevent them from being victimized by their creditors. While it is admitted in said law that since liberation conditions have gradually returned to normal, this is not so with regard to those who have suffered the ravages of war and so it was therein declared as a policy that as to them the debt moratorium should be continued in force (section 1).But we should not lose sight of the fact that these obligations had been pending since 1945 as a result of the issuance of Executive Orders Nos. 25 and 32 and at present their enforcement is still inhibited because of the enactment of Republic Act No. 342 and would continue to be unenforceable during the eight-year period granted to prewar debtors to afford them an opportunity to rehabilitate themselves, which in plain language means that the creditors would have to observe a vigil of at least twelve (12) years before they could effect a liquidation of their investment dating as far back as 1941. This period seems to us unreasonable, if not oppressive. While the purpose of Congress is plausible, and should be commended, the relief accorded works injustice to creditors who are practically left at the mercy of the debtors. Their hope to effect collection becomes extremely remote, more so if the credits are unsecured. And the injustice is more patent when, under the law, the debtor is not even required to pay interest during the operation of the relief, unlike similar statutes in the United States (Home Building and Loan Association vs. Blaisdell, supra).There are at least three cases where the Supreme Court of the United States declared the moratorium laws violative of the contract clause of the Constitution because the period granted to debtors as a relief was found unwarranted by the contemplated emergency. One of them is W. B. Worthen Co. vs. Thomas, 292 U. S., 426-435; 78 L. ed., 1344, 1347. Here the Legislature of Arkansas passed an act providing for an exemption, "without limitation as to amount or restriction with respect to particular circumstances or relations, of all monies paid or payable to any resident of the state under any life, sick, accident or disability insurance policy, from liability for the payment of the debts of the recipient", and an attempt was made to apply the statute to debts owing before its approval. The court held that "such an exemption, applied in the case of debts owing before the exemption was created by the legislature, constitutes an unwarranted interference with the obligation of contracts in violation of the constitutional provision", and cannot be sustained even as emergency legislation, because it contains no limitation as to time, amount, circumstances or need (supra, 292 U. S., pp. 426-432).The other case is W. B. Worthen vs. Kavanaugh (supra). Here certain Municipal Improvement Districts organized under the laws of Arkansas were empowered to issue bonds and to mortgage benefit assessments as security therefor. One of these districts acted upon the powers thus conferred. Some of the bonds were in default for nonpayment of principal and interest. So an action was brought by the bond-holders to foreclose the assessments upon the lots of delinquent owners. These bonds and mortgages were executed under the statutes then in force. Later the legislature of Arkansas passed three acts making changes in the remedies available under the former statutes, which changes were attacked as an unconstitutional impairment of contracts. The court sustained this view holding that the "changes in the remedies available for the enforcement of a mortgage may not, even when the public welfare is invoked as an excuse, be pressed so far as to cut down the security of a mortgage without moderation or reason or in a spirit of oppression. . . . A State is free to regulate the procedure in its courts even with reference to contracts already made, and moderate extensions of the time for pleading or for trial will ordinarily fall within the power so reserved; but a different situation is presented when extensions are so piled up as to make the remedy a shadow."The third case is Louisville Joint Stock Land Bank vs. Radford, 295 U. S. 555, 79 L. ed. 1593. This case presented for decision the question whether subsection (s) added to section 75 of the Bankruptcy Act by the Frazier-Lemke Act, June 28, 1934, chap. 869, 48 Stat. at L. 1289 U. S. C. title 11, sec. 203, is consistent with the Federal Constitution. The court said that it is unconstitutional if applied to farm mortgages already existing, holding that "property rights of holders of farm mortgages are unconstitutionally taken, in violation of the Fifth Amendment, by a statute (Bankruptcy Act, sec. 75 (s); Frazier-Lemke Act of June 28, 1934, chap. 869, 48 Stat. at L. 1289) applicable only to debts existing at the time of its enactment, which provides that a farmer whose farm is mortgaged, and who has failed to obtain the consents necessary to a composition under the Bankruptcy Act, may, upon being adjudged a bankrupt, if the mortgagee assents, purchase the mortgaged property at its then appraised value by agreeing to make deferred payments of stated percentages of the appraised value over a period of six years, with interest at 1 per cent per annum, or, if the mortgagee refuses his assent to such purchase, may obtain a stay of all proceedings for a period of five years, during which he shall retain possession of all or any part of his property, under the control of the court, provided he pays a reasonable rental therefor, and that at the end of five years he may pay into court the appraised price thereof, or, if a lien holder shall request a reappraisal by the court, the reappraised price, whereupon the court shall, by an order, turn over full possession and title of the property to the debtor, and he may apply for his discharge."In addition, we may cite leading state court decisions which practically involved the same ruling and which reflect the tendency of the courts towards legislation involving modification of mortgage or monetary contracts which contains provisions that are deemed unreasonable or oppressive. Some of those which may be deemed representative follows:1.Pouquette vs. O'Brien, 100 Pac. 2nd series, 979 (1940). The Supreme Court of Arizona held unconstitutional a 1937 statute authorizing courts to extend for a period of not longer than two years all actions or foreclosures of real estate mortgages, and a 1939 statute authorizing the courts to extend foreclosure proceedings not later than March 4, 1941.2.First Trust Joint Stock Land Bank of Chicago vs. Adolph Arp et al., 283 N.W. 441, 120 A.L.R. 932 (1939). The Supreme Court of Iowa declared unconstitutional the Moratorium Acts enacted in 1933,1935 and 1937, providing for extension of the 1933 Moratorium Act covering a period of six years.3.First Trust Co. of Lincoln vs. Smith et al., 277 N.W. 762 (1938). The Supreme Court of Nebraska declared unconstitutional the Nebraska Moratorium Law as reenacted, extending the benefit of the remedy to a period of six years, as being repugnant to the contract clause of the Constitution.4.Milkint vs. McNeely, Clerk of court, et al., 169 S.E. 790 (1933). The Supreme Court of Appeals of West Virginia declared unconstitutional certain acts of legislature enacted in 1932, extending the period of redemption three years beyond the one-year period then allowed by statute, being an impairment of contract as to sales made prior to enactment thereof.5.Haynes vs. Treadway, 65 Pac. 892 (1901). The Supreme Court of California declared unconstitutional a statute which extends the right of redemption from six months to twelve months being a substantial impairment of the obligation contracts if applied to a mortgage already executed.6.Swinburne vs. Mills, 50 Pac. 489 (1897). The Supreme Court of Washington declared a statute unconstitutional in so far as it provides that, on a decree for foreclosure of a mortgage executed before the act was passed, the debtor shall be entitled to have the order of sale stayed for one year, as being an impairment of the obligation of contract.These cases apply with added force in this jurisdiction considering the conditions now prevailing in our country.We do not need to go far to appreciate this situation. We can see it and feel it as we gaze around to observe the wave of reconstruction and rehabilitation that has swept the country since liberation thanks to the aid of America and the innate progressive spirit of our people. This aid and this spirit have worked wonders in so short a time that it can now be safely stated that in the main the financial condition of our country and our people, individually and collectively, has practically returned to normal notwithstanding occasional reverses caused by local dissidence and the sporadic disturbance of peace and order in our midst. Business, industry and agriculture have picked up and developed at such stride that we can say that we are now well on the road to recovery and progress. This is so not only as far as our observation and knowledge are capable to take note and comprehend but also because of the official pronouncements made by our Chief Executive in public addresses and in several messages he submitted to Congress on the general state of the nation. To bear this out, it would suffice for us to state some of those public statements which we deem to be most expressive and representative of the general situation. We quote:"We have balanced our national budget. We shall again have at the end of the current fiscal year a sizeable surplus. . . . We have greatly improved the economic and financial conditions of the country. Through the Rehabilitation Finance Corporation, loans amounting to P90,480,136 have been granted for the reconstruction and rehabilitation purposes. . . . We have set up the Central Bank to expand our credit, stabilize our currency and provide a new source of financing for the agricultural and industrial development of the nation.xxx xxx xxx . . . The commitment thus far made is not only a favorable sign ushering in finally the implementation of our plans of economic development, but a significantly successful test of the solvency of our foreign credit, for it was accepted only after a thorough examination of our resources and development plans by a board of economists of international authority" (Pres. Quirino's "State-of-the- Nation" Message to the Joint Session of Congress on Jan. 24, 1949, 45 Off. Gaz., Jan., 1949). "We have strengthened, . . . our internal and external finances. Six years ago, we were a country prostrate from the destruction of war. . . . Today, we can say that our people not only have returned to their prewar activities, but . . . have progressed and prospered far beyond what they ever dreamed of before the war.. . . Three years ago the national income stood at four billion pesos; today it is over seven billion pesos. . . . The government income has been steadily rising from 60 million pesos in 1946 to approximately 600 million pesos today, also a progress in six years.xxx xxx xxx. . . The ravages of war are fast disappearing, and instead, what beautiful vistas unfold themselves before our eyes at this moment in our immediate surroundings. Compare this beautiful view with that of the past and all that we have accomplished in scarcely six years of struggle, sacrifice, determination, and bold decision. (Applause.) We have brought this nation out of the paralysis of destruction into economic normalcy and financial stability. . . . . . . Our external finances have greatly improved, and . . . our pesos is one of the most stable currencies in the world today. (Applause.) I repeat, our pesos is one of the most stable currencies in the world today.All these find grateful reflection in a better-sheltered, better- clothed, better-fed, and healthier population that has grown from 18 million to 20 million in a half dozen years, in a school enrollment that has doubled since the outbreak of the last war from less than 2 million to over 4 million young students in the public schools, and in democratic processes that are gaining in vigor and permanence with each passing year" (Address of his Excellency Elpidio Quirino, President of the Philippines, on the occasion of the celebration of the sixth anniversary of the independence of the Philippines, July 4, 1952, Luneta, Manila, 48 Off. Gaz., pp. 3287-3289).In the face of the foregoing observations, and consistent with what we believe to be as the only course dictated by justice, fairness and righteousness, we feel that the only way open to us under the present circumstances is to declare that the continued operation and enforcement of Republic Act No. 342 at the present time is unreasonable and oppressive, and should not be prolonged a minute longer, and, therefore, the same should be declared null and void and without effect. And what we say here with respect to said Act also holds true as regards Executive Orders Nos. 25 and 32, perhaps with greater force and reason as to the latter, considering that said Orders contain no limitation whatsoever in point of time as regards the suspension of the enforcement and effectivity of monetary obligations. And there is need to make this pronouncement in view of the revival clause embodied in said Act if and when it is declared unconstitutional or invalid,Wherefore, the decision appealed from will be reversed, without pronouncement as to costs.Judgment is hereby rendered ordering the defendant to pay the plaintiff the sum of P4,800 with interest thereon at the rate of 7 per cent per annum from August 27, 1942, until its full payment, plus 12 per cent as attorney's fees. Failure to pay this judgment as stated, the properties mortgaged will be sold at public auction and the proceeds applied to its payment in accordance with law. So ordered.Paras, C.J., Feria, Bengzon, Padilla, Tuason and Labrador, JJ., concur.Pablo, J., concurs with the dispositive part.FIRST DIVISION[G.R. No. 61311. September 21, 1987.]FELICIDAD VILLANUEVA, FERNANDO CAISIP, ANTONIO LIANG, FELINA MIRANDA, RICARDO PUNO, FLORENCIO LAXA, and RENE OCAMPO, petitioners, vs. HON. MARIANO CASTAEDA, JR., Presiding Judge of the Court of First Instance of Pampanga, Branch III, VICENTE A. MACALINO, Officer-in-Charge, Office of the Mayor, San Fernando, Pampanga, respondents.D E C I S I O NCRUZ, J p:There is in the vicinity of the public market of San Fernando, Pampanga, along Mercado Street, a strip of land measuring 12 by 77 meters on which stands a conglomeration of vendors stalls together forming what is commonly known as a talipapa. This is the subject of the herein petition. The petitioners claim they have a right to remain in and conduct business in this area by virtue of a previous authorization granted to them by the municipal government. The respondents deny this and justify the demolition of their stalls as illegal constructions on public property. At the petitioners' behest, we have issued a temporary restraining order to preserve the status quo between the parties pending our decision. 1 Now we shall rule on the merits. prcdThis dispute goes back to November 7, 1961, when the municipal council of San Fernando adopted Resolution No. 218 authorizing some 24 members of the Fernandino United Merchants and Traders Association to construct permanent stalls and sell in the above-mentioned place. 2 The action was protested on November 10, 1961, in Civil Case No. 2040, where the Court of First Instance of Pampanga, Branch 2, issued a writ of preliminary injunction that prevented the defendants from constructing the said stalls until final resolution of the controversy. 3 On January 18, 1964, while this case was pending, the municipal council of San Fernando adopted Resolution No. 29, which declared the subject area as "the parking place and as the public plaza of the municipality," 4 thereby impliedly revoking Resolution No. 218, series of 1961. Four years later, on November 2, 1968, Judge Andres C. Aguilar decided the aforesaid case and held that the land occupied by the petitioners, being public in nature, was beyond the commerce of man and therefore could not be the subject of private occupancy. 5 The writ of preliminary injunction was made permanent. 6 The decision was apparently not enforced, for the petitioners were not evicted from the place; in fact, according to them, they and the 128 other persons were in 1971 assigned specific areas or space allotments therein for which they paid daily fees to the municipal government. 7 The problem appears to have festered for some more years under a presumably uneasy truce among the protagonists, none of whom made any move, for some reason that does not appear in the record. Then, on January 12, 1982, the Association of Concerned Citizens and Consumers of San Fernando filed a petition for the immediate implementation of Resolution No. 29, to restore the subject property "to its original and customary use as a public plaza." 8 Acting thereon after an investigation conducted by the municipal attorney, 9 respondent Vicente A. Macalino, as officer in-charge of the office of the mayor of San Fernando, issued on June 14, 1982, a resolution requiring the municipal treasurer and the municipal engineer to demolish the stalls in the subject place beginning July 1, 1982. 10 The reaction of the petitioners was to file a petition for prohibition with the Court of First Instance of Pampanga, docketed as Civil Case No. 6470, on June 26, 1982. The respondent judge denied the petition on July 19, 1982, 11 and the motion for reconsideration on August 5, 1982, 12 prompting the petitioners to come to this Court on certiorari to challenge his decision. 13 As required, respondent Macalino filed his comment 14 on the petition, and the petitioners countered with their reply. 15 In compliance with our resolution of February 2, 1983, the petitioners submitted their memorandum 16 and respondent Macalino, for his part, asked that his comment be considered his memorandum. 17 On July 28, 1986, the new officer-in-charge of the office of the mayor of San Fernando, Paterno S. Guevarra, was impleaded in lieu of Virgilio Sanchez, who had himself earlier replaced the original respondent Macalino. 18 After considering the issues and the arguments raised by the parties in their respective pleadings, we rule for the respondents. The petition must be dismissed.There is no question that the place occupied by the petitioners and from which they are sought to be evicted is a public plaza, as found by the trial court in Civil Case No. 2040. This finding was made after consideration of the antecedent facts as especially established by the testimony of former San Fernando Mayor Rodolfo Hizon, who later became governor of Pampanga, that the National Planning Commission had reserved the area for a public plaza as early as 1951. This intention was reiterated in 1964 through the adoption of Resolution No. 29.19 It does not appear that the decision in this case was appealed or has been reversed. In Civil Case No. 6740, which is the subject of this petition, the respondent judge saw no reason to disturb the finding in Civil Case No. 2040 and indeed used it as a basis for his own decision sustaining the questioned order. 20 The basic contention of the petitioners is that the disputed area is under lease to them by virtue of contracts they had entered into with the municipal government, first in 1961 insofar as the original occupants were concerned, and later with them and the other petitioners by virtue of the space allocations made in their favor in 1971 for which they say they are paying daily fees. 21 The municipal government has denied making such agreements. In any case, they argue, since the fees were collected daily, the leases, assuming their validity, could be terminated at will, or any day, as the claimed rentals indicated that the period of the leases was from day to day. 22 The parties belabor this argument needlessly.A public plaza is beyond the commerce of man and so cannot be the subject of lease or any other contractual undertaking. This is elementary. Indeed, this point was settled as early as in Municipality of Cavite v. Rojas, 23 decided in 1915, where the Court declared as null and void the lease of a public plaza of the said municipality in favor of a private person. cdllJustice Torres said in that case:"According to article 344 of the Civil Code: `Property for public use in provinces and in towns comprises the provincial and town roads, the squares, streets, fountains, and public waters, the promenades, and public works of general service supported by said towns or provinces.'"The said Plaza Soledad being a promenade for public use, the municipal council of Cavite could not in 1907 withdraw or exclude from public use a portion thereof in order to lease it for the sole benefit of the defendant Hilaria Rojas. In leasing a portion of said plaza or public place to the defendant for private use the plaintiff municipality exceeded its authority in the exercise of its powers by executing a contract over a thing of which it could not dispose, nor is it empowered so to do."The Civil Code, article 1271, prescribes that everything which is not outside the commerce of man may be the object of a contract, and plazas and streets are outside of this commerce, as was decided by the supreme court of Spain in its decision of February 12, 1895, which says: 'Communal things that cannot be sold because they are by their very nature outside of commerce are those for public use, such as the plazas, streets, common lands, rivers, fountains, etc.'"Therefore, it must be concluded that the contract, Exhibit C, whereby the municipality of Cavite leased to Hilaria Rojas a portion of the Plaza Soledad is null and void and of no force or effect, because it is contrary to the law and the thing leased cannot be the object of a contract."In Muyot v. de la Fuente, 24 it was held that the City of Manila could not lease a portion of a public sidewalk on Plaza Sta. Cruz, being likewise beyond the commerce of man. LibLexEchoing Rojas, the decision said:"Appellants claim that they had obtained permit from the government of the City of Manila, to construct booths Nos. 1 and 2, along the premises in question, and for the use of spaces where the booths were constructed, they had paid and continued paying the corresponding rentals. Granting this claim to be true, one should not entertain any doubt that such permit was not legal, because the City of Manila does not have any power or authority at all to lease a portion of a public sidewalk. The sidewalk in question, forming part of the public plaza of Sta. Cruz, could not be a proper subject matter of the contract, as it was not within the commerce of man (Article 1347, new Civil Code, and article 1271, old Civil Code). Any contract entered into by the City of Manila in connection with the sidewalk, is ipso facto null and ultra vires. (Municipality of Cavite vs. Roxas, et al., 30 Phil. 603.) The sidewalk in question was intended for and was used by the public, in going from one place to another. 'The streets and public places of the city shall be kept free and clear for the use of the public, and the sidewalks and crossings for the pedestrians, and the same shall only be used or occupied for other purposes as provided by ordinance or regulation; . . ..' (Sec. 1119, Revised Ordinances of the City of Manila.) The booths in question served as fruit stands for their owners and often, if not always, blocked the free passage of pedestrians who had to take the plaza itself which used to be clogged with vehicular traffic."Exactly in point is Espiritu v. Municipal Council of Pozorrubio, 25 where the Supreme Court declared:"There is absolutely no question that the town plaza cannot be used for the construction of market stalls, specially of residences, and that such structures constitute a nuisance subject to abatement according to law. Town plazas are properties of public dominion, to be devoted to public use and to be made available to the public in general. They are outside the commerce of man and cannot be disposed of or even leased by the municipality to private parties."Applying this well-settled doctrine, we rule that the petitioners had no right in the first place to occupy the disputed premises and cannot insist in remaining there now on the strength of their alleged lease contracts. They should have realized and accepted this earlier, considering that even before Civil Case No. 2040 was decided, the municipal council of San Fernando had already adopted Resolution No. 29, series of 1964, declaring the area as the parking place and public plaza of the municipality. cdphilIt is the decision in Civil Case No. 2040 and the said resolution of the municipal council of San Fernando that respondent Macalino was seeking to enforce when he ordered the demolition of the stalls constructed in the disputed area. As officer-in-charge of the office of the mayor, he had the duty to clear the area and restore it to its intended use as a parking place and public plaza of the municipality of San Fernando, conformably to the aforementioned orders from the court and the council. It is, therefore, not correct to say that he had acted without authority or taken the law into his hands in issuing his order. LLphilNeither can it be said that he acted whimsically in exercising his authority for it has been established that he directed the demolition of the stalls only after, upon his instructions, the municipal attorney had conducted an investigation, to look into the complaint filed by the Association of Concerned Citizens and Consumers of San Fernando. 26 There is evidence that the petitioners were notified of this hearing, 27 which they chose to disregard. Photographs of the disputed area, 28 which does look congested and ugly, show that the complaint was valid and that the area really needed to be cleared, as recommended by the municipal attorney.The Court observes that even without such investigation and recommendation, the respondent mayor was justified in ordering the area cleared on the strength alone of its status as a public plaza as declared by the judicial and legislative authorities. In calling first for the investigation (which the petitioner saw fit to boycott), he was just scrupulously paying deference to the requirements of due process, to remove all taint of arbitrariness in the action he was called upon to take. LLphilSince the occupation of the place in question in 1961 by the original 24 stallholders (whose number later ballooned to almost 200), it has deteriorated increasingly to the great prejudice of the community in general. The proliferation of stalls therein, most of them makeshift and of flammable materials, has converted it into a veritable fire trap, which, added to the fact that it obstructs access to and from the public market itself, has seriously endangered public safety. The filthy condition of the talipapa, where fish and other wet items are sold, has aggravated health and sanitation problems, besides pervading the place with a foul odor that has spread into the surrounding areas. The entire place is unsightly, to the dismay and embarrassment of the inhabitants, who want it converted into a showcase of the town of which they can all be proud. The vendors in the talipapa have also spilled into the street and obstruct the flow of traffic, thereby impairing the convenience of motorists and pedestrians alike. The regular stallholders in the public market, who pay substantial rentals to the municipality, are deprived of a sizable volume of business from prospective customers who are intercepted by the talipapa vendors before they can reach the market proper. On top of all these, the people are denied the proper use of the place as a public plaza, where they may spend their leisure in a relaxed and even beautiful environment and civic and other communal activities of the town can be held. cdllThe problems caused by the usurpation of the place by the petitioners are covered by the police power as delegated to the municipality under the general welfare clause. 29 This authorizes the municipal council "to enact such ordinances and make such regulations, not repugnant to law, as may be necessary to carry into effect and discharge the powers and duties conferred upon it by law and such as shall seem necessary and proper to provide for the health and safety, promote the prosperity, improve the morals, peace, good order, comfort, and convenience of the municipality and the inhabitants thereof, and for the protection of property therein." This authority was validly exercised in this case through the adoption of Resolution No. 29, series of 1964, by the municipal council of San Fernando. CdprEven assuming a valid lease of the property in dispute, the resolution could have effectively terminated the agreement for it is settled that the police power cannot be surrendered or bargained away through the medium of a contract. 30 In fact, every contract affecting the public interest suffers a congenital infirmity in that it contains an implied reservation of the police power as a postulate of the existing legal order. 31 This power can be activated at any time to change the provisions of the contract, or even abrogate it entirely, for the promotion or protection of the general welfare. Such an act will not militate against the impairment clause, which is subject to and limited by the paramount police power. 32 We hold that the respondent judge did not commit grave abuse of discretion in denying the petition for prohibition. On the contrary, he acted correctly in sustaining the right and responsibility of the mayor to evict the petitioners from the disputed area and clear it of all the structures illegally constructed therein.The Court feels that it would have been far more amiable if the petitioners themselves, recognizing their own civic duty, had at the outset desisted from their original stance and withdrawn in good grace from the disputed area to permit its peaceful restoration as a public plaza and parking place for the benefit of the whole municipality. They owed this little sacrifice to the community in general, which has suffered all these many years because of their intransigence. Regrettably, they have refused to recognize that in the truly democratic society, the interests of the few should yield to those of the greater number in deference to the principles that the welfare of the people is the supreme law and overriding purpose. We do not see any altruism here. The traditional ties of sharing are absent here. What we find, sad to say, is a cynical disdaining of the spirit of "bayanihan", a selfish rejection of the cordial virtues of "pakikisama" and "pagbibigayan" which are the hallmarks of our people. LLphilWHEREFORE, the petition is DISMISSED. The decision dated July 19, 1982, and the order dated August 5, 1982, are AFFIRMED. The temporary restraining order dated August 9, 1982, is LIFTED. This decision is immediately executory. Costs against the petitioners.SO ORDERED.Teehankee, C.J., Narvasa and Paras, JJ ., concur.Gancayco, J., is on leave.EN BANC[G.R. No. 71169. December 22, 1988.]JOSE 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.[G.R. No. 74376. December 22, 1988.]BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, vs. THE INTERMEDIATE APPELLATE COURT, ROSARIO DE JESUS TENORIO, and CECILIA GONZALVEZ, respondents.[G.R. No. 76394. December 22, 1988.]BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, vs. THE COURT OF APPEALS, and EDUARDO and BUENA ROMUALDEZ, respondents.[G.R. No. 78182. December 22, 1988.]BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, vs. COURT OF APPEALS, DOLORES FILLEY, and J. ROMERO & ASSOCIATES, respondents.[G.R. No. 82281. December 22, 1988.]BEL-AIR VILLAGE ASSOCIATION, INC., petitioner, vs. COURT OF APPEALS, VIOLETA MONCAL, and MAJAL DEVELOPMENT CORPORATION, respondents.Sangco, Anastacio, Castaeda & Duran Law Office for petitioners & private intervenors-petitioners.Raul S. Sison Law Offices for intervenor-petitioner Bel-Air Village Association, Inc.Renato L. Dela Fuente for respondent Ayala Corporation.Raul S. Sison Law Offices for petitioner.Sergio L. Guadiz for private respondents.Raul S. Sison Law Offices for petitioner.Gruba, Tanlimco, Lamson and Apuhin Law Offices for respondents.Funk & Associates for petitioners.Tee Tomas & Associates for respondents.Funk & Associates for petitioner.Castillo, Laman, Tan & Associates for private respondents.D E C I S I O NSARMIENTO, J p:Before the Court are five consolidated petitions, 1 docketed as G.R. Nos. 71169, 74376, 76394, 78182, and 82281 hereof, in the nature of appeals (by certiorari under Rule 45 of the Rules of Court) from five decisions of the Court of Appeals, denying specific performance and damages. LexLibThe proceedings were commenced at the first instance by Jose Sangalang, joined by his wife Lutgarda Sangalang, both residents of No. 110 Jupiter Street, Makati, Metro Manila (G.R. No. 71169) to enforce by specific performance restrictive easement upon property, specifically the Bel-Air Village subdivision in Makati, Metro Manila, pursuant to stipulations embodied in the deeds of sale covering the subdivision, and for damages. Later, the Sangalangs were joined by Felix Gaston, a resident of No. 64 Jupiter Street of the same municipality, and by Mr. and Mrs. Jose and Alicia Briones, both of No. 66 Jupiter Street. Pending further proceedings, the Bel-Air Village Association, Inc. (BAVA), an incorporated homeowners' association, entered its appearance as plaintiff-in-intervention.BAVA itself had brought its own complaints, four in number, likewise for specific performance and damages to enforce the same "deed restrictions." (See G.R. Nos. 74376, 76394, 78182, and 82281.)ANTECEDENTS FACTSI.G.R. No. 71169The facts are stated in the decision appealed from. We quote:xxx xxx xxx(1)Bel-Air Village is located north of Buendia Avenue extension (now Sen. Gil J. Puyat Ave.) across a stretch of commercial block from Reposo Street in the west up to Zodiac Street in the east. When Bel-Air Village was planned, this block between Reposo and Zodiac Streets adjoining Buendia Avenue in front of the village was designated as a commercial block. (Copuyoc, TSN, p. 10, Feb. 12, 1982)(2)Bel-Air Village was owned and developed into a residential subdivision in the 1950s by Makati Development Corporation (hereinafter referred to as MDC), which in 1968 was merged with appellant Ayala Corporation.(3)Appellees-spouses Sangalang reside at No. 110 Jupiter Street between Makati Avenue and Reposo Street; appellees-spouses Gaston reside at No. 64 Jupiter Street between Makati Avenue and Zodiac Street; appellees-spouses Briones reside at No. 66 Jupiter Street also between Makati Avenue and Zodiac Street; while appellee Bel-Air Village Association, Inc. (hereinafter referred to as BAVA) is the homeowners' association in Bel-Air Village which takes care of the sanitation, security, traffic regulations and general welfare of the village.(4)The lots which were acquired by appellees Sangalang and spouse Gaston and spouse and Briones and spouse in 1960, 1957 and 1958, respectively, were all sold by MDC subject to certain conditions and easements contained in Deed Restrictions which formed a part of each deed of sale. The pertinent provisions in said Deed Restrictions, which are common to all lot owners in Bel-Air Village, are as follows:"I BEL-AIR ASSOCIATIONThe owner of this lot/s or his successors in interest is required to be and is automatically a member of the Bel-Air Association and must abide by such rules and regulations laid down by the Association in the interest of the sanitation, security and the general welfare of the community."The association will also provide for and collect assessments, which will constitute as a lien on the property junior only to liens of the government for taxes and to voluntary mortgages for sufficient consideration entered into in good faith."II USE OF LOTS"Subject to such amendments and additional restrictions, reservations, servitudes, etc., as the Bel-Air Association may from time to time adopt and prescribe, this lot is subject to the following restrictions:"a.This lot/s shall not be subdivided. However, three or more lots may be consolidated and subdivided into a lesser number of lots provided that none of the resulting lots be smaller in area than the smallest lot before the consolidation and that the consolidation and subdivision plan be duly approved by the governing body of the Bel-Air Association."b.This lot/s shall only be used for residential purposes."c.Only one single family house may be constructed on a single lot, although separate servants' quarters or garage may be built."d.Commercial or advertising signs shall not be placed, constructed, or erected on this lot. Name plates and professional signs of homeowners are permitted so long as they do not exceed 80 x 40 centimeters in size."e.No cattle, pigs, sheep, goats, ducks, geese, roosters or rabbits shall be maintained in the lot, except that pets may be maintained but must be controlled in accordance with the rulings of the Association. The term "pets" includes chickens not in commercial quantities."f.The property is subject to an easement of two (2) meters within the lot and adjacent to the rear and sides thereof not fronting a street for the purpose of drainage, sewage, water and other public facilities as may be necessary and desirable; and the owner, lessee or his representative shall permit access thereto by authorized representatives of the Bel-Air Association or public utility entities for the purposes for which the easement is created."g.This lot shall not be used for any immoral or illegal trade or activity."h.The owner and/or lessee of this lot/s shall at all times keep the grass cut and trimmed to reduce the fire hazard of the property.xxx xxx xxx"VI TERM OF RESTRICTIONS"The foregoing restrictions shall remain in force for fifty years from January 15, 1957, unless sooner cancelled in its entirety by two thirds vote of members in good standing of the Bel-Air Association. However, the Association may, from time to time, add new ones, amend or abolish particular restrictions or parts thereof by majority rule."VII ENFORCEMENT OF RESTRICTIONS"The foregoing restrictions may be enjoined and/or enforced by court action by the Bel-Air Association, or by the Makati Development Corporation or its assigns, or by any registered owner of land within the boundaries of the Bel-Air Subdivision (Sub-division plan PSD-49226 and Lot 7-B, Psd-47848) or by any member in good standing of the Bel-Air association." (Exh. 1-b; Exh. 22, Annex "B"). (Appellant's Brief, pp. 4-6)(5)When MDC sold the above-mentioned lots to appellees' predecessors-in-interest, the whole stretch of the commercial block between Buendia Avenue and Jupiter Street, from Reposo Street in the west to Zodiac Street in the east, was still undeveloped. Access, therefore, to Bel-Air Village was opened to all kinds of people and even animals. So in 1966, although it was not part of the original plan, MDC constructed a fence or wall on the commercial block along Jupiter Street. In 1970, the fence or wall was partly destroyed by typhoon "Yoling." The destroyed portions were subsequently rebuilt by the appellant. (Copuyoc, TSN, pp. 31-34, Feb. 12, 1982). When Jupiter Street was widened in 1972 by 3.5 meters, the fence or wall had to be destroyed. Upon request of BAVA, the wall was rebuilt inside the boundary of the commercial block. (Copuyoc, TSN, pp. 44-47, Feb. 12, 1982).(6)When the appellant finally decided to subdivide and sell the lots in the commercial block between Buendia and Jupiter, BAVA wrote the appellant on May 9, 1972, requesting for confirmation on the use of the commercial lots. The appellant replied on May 16, 1972, informing BAVA of the restrictions intended to be imposed in the sale and use of the lots. Among these restrictions are: that the building shall have a set back of 19 meters; and that with respect to vehicular traffic along Buendia Avenue, entrance only will be allowed, and along Jupiter Street and side streets, both entrance and exit will be allowed.(7)On June 30, 1972, appellant informed BAVA that in a few months it shall subdivide and sell the commercial lots bordering the north side of Buendia Avenue Extension from Reposo Street up to Zodiac Street. Appellant also informed BAVA that it had taken all precautions and will impose upon the commercial lot owners deed restrictions which will harmonize and blend with the development and welfare of Bel-Air Village. Appellant further applied for special membership in BAVA of the commercial lot owners. A copy of the deed restrictions for the commercial lots was also enclosed. The proposed deed restrictions shall include the 19 meter set back of buildings from Jupiter Street, the requirement for parking space within the lot of one (1) parking slot for every seventy five (75) meters of office space in the building and the limitation of vehicular traffic along Buendia to entrance only, but allowing both vehicular entrance and vehicular exit through Jupiter Street and any side street.In its letter of July 10, 1972, BAVA acknowledged the above letter of appellant and informed the latter that the application for special membership of the commercial lot owners in BAVA would be submitted to BAVA's board of governors for decision.(8)On September 25, 1972, appellant notified BAVA that, after a careful study, it was finally decided that the height limitation of buildings on the commercial lots shall be increased from 12.5 meters to 15 meters. Appellant further informed BAVA that Jupiter Street shall be widened by 3.5 meters to improve traffic flow in said street. BAVA did not reply to said letter, but on January 22, 1973, BAVA wrote a letter to the appellant informing the latter that the Association had assessed the appellant, as special member of the association, the amount of P40,795.00 (based on 81,590 square meters at P.50 per square meter) representing the membership dues to the commercial lot owners for the year 1973, and requested the appellant to remit the amount which its board of governors had already included in its current budget. In reply, appellant on January 31, 1973 informed BAVA that due to the widening of Jupiter Street, the area of the lots which were accepted by the Association as members was reduced to 76,726 square meters. Thus, the corresponding dues at P.50 per square meter should be reduced to P38,363.00. This amount, therefore, was remitted by the appellant to BAVA. Since then, the latter has been collecting membership dues from the owners of the commercial lots as special members of the Association. As a matter of fact, the dues were increased several times. In 1980, the commercial lot owners were already being charged dues at the rate of P3.00 per square meter. (Domingo, TSN, p. 36, March 19, 1980). At this rate, the total membership dues of the commercial lot owners amount to P230,178.00 annually based on the total area of 76,726 square meters of the commercial lots.(9)Meantime, on April 4, 1975, the municipal council of Makati enacted its ordinance No. 81, providing for the zonification of Makati (Exh. 18). Under this Ordinance, Bel-Air Village was classified as a Class A Residential Zone, with its boundary in the south extending to the center line of Jupiter Street (Exh. 18-A).Thus, Chapter III, Article I, Section 3.03, par. F. of the Ordinance provides:"F.Bel-Air Village area, as bounded on the N by Polaris and Mercedes streets and on the NE by Estrella Street; on the SE by Epifanio de los Santos Avenue and on the SW by the center line of Jupiter Street. Then bounded on the N by the abandoned MRR Pasig Line; on the E by Makati Avenue; on the S by the center line of Jupiter Street and on the W by the center line of Reposo Street." (Exh. 18-A)Similarly, the Buendia Avenue Extension area was classified as Administrative Office Zone with its boundary in the North-North East Extending also up to the center line of Jupiter Street (Exh. 18-b).Thus, Chapter III, Article I, Section 3.05, par. C. of the Ordinance provides:"C.The Buendia Avenue Extension areas, as bounded on the N-NE by the center line of Jupiter Street, on the SE by Epifanio de los Santos Avenue; on the SW by Buendia Avenue and on the NW by the center line of Reposo Street, then on the N-E by Malugay Street; on the SE by Buendia Avenue and on the W by Ayala Avenue Extension." (Exh. 18-B)The Residential Zone and the Administrative Office Zone, therefore, have a common boundary along the center line of Jupiter Street.The above zoning under Ordinance No. 81 of Makati was later followed under the Comprehensive Zoning Ordinance for the National Capital Region adopted by the Metro Manila Commission as Ordinance 81-01 on March 14, 1981 (Exh. 19). However, under this ordinance, Bel-Air Village is simply bounded in the South-Southeast by Jupiter Street not anymore up to the center line of Jupiter Street (Exh. B). Likewise, the block-deep strip along the northwest side of Buendia Avenue Extension from Reposo to EDSA was classified as a High Intensity Commercial Zone (Exh. 19-c).Thus, the Zoning District Boundaries Makati, in Annex B of the Ordinance provides:"R-1 Low Intensity Residential.xxx xxx xxx"4.Bel-Air 1, 3, 4Bounded on the North J.P. Rizal and Amapola St.South RockwellNorthwest P. BurgosSoutheast JupiterSouthwest Epifanio de los Santos Ave. (EDSA).5.Bel-Air 2Bounded on the Northwest J.P. RizalSouthwest Makati AvenueSouth JupiterSoutheast Pasig LineEast South Avenue" (Exh. 19-b)xxx xxx xxx"C-3 High Intensity Commercial Zone."2.A block deep strip along the northwest side of Buendia Ave. Ext. from Reposo to EDSA." (Exh. 19-c)Under the above zoning classifications, Jupiter Street, therefore, is a common boundary of Bel-Air Village and the commercial zone.(10)Meanwhile, in 1972, BAVA had installed gates at strategic locations across Jupiter Street which were manned and operated by its own security guards who were employed to maintain, supervise and enforce traffic regulations in the roads and streets of the village. (Villavicencio, TSN, pp. 22-25, Oct. 30, 1980; BAVA Petition, par. 11, Exh. 17).Then, on January 17, 1977, the Office of the Mayor of Makati wrote BAVA directing that, in the interest of public welfare and for the purpose of easing traffic congestion, the following streets in Bel-Air Village should be opened for public use:Amapola Street from Estrella Street to Mercedes StreetAmapola Street junction of Palma Street gate going to J. Villena StreetMercedes Street from EDSA to Imelda Avenue and Amapola junctionZodiac Street from Mercedes Street to Buendia AvenueJupiter Street from Zodiac Street to Reposo Street connecting Metropolitan Avenue to Pasong Tamo and V. Cruz Extension intersectionNeptune Street from Makati Avenue to Reposo StreetOrbit Street from F. Zobel Candelaria intersection to Jupiter Street Paseo de Roxas from Mercedes Street to Buendia Avenue (Exh. 17, Annex A, BAVA Petition)On February 10, 1977, BAVA wrote the Mayor of Makati, expressing the concern of the residents about the opening of the streets to the general public, and requesting specifically the indefinite postponement of the plan to open Jupiter Street to public vehicles. (Exh. 17, Annex B, BAVA Petition).However, BAVA voluntarily opened to the public Amapola, Mercedes, Zodiac, Neptune and Paseo de Roxas streets. (Exh. 17-A, Answer of Makati par. 3-7).Later, on June 17, 1977, the Barangay Captain of Bel-Air Village was advised by the Office of the Mayor that, in accordance with the agreement entered into during the meeting on January 28, 1977, the Municipal Engineer and the Station Commander of the Makati Police were ordered to open for public use Jupiter Street from Makati Avenue to Reposo Street. Accordingly, he was requested to advise the village residents of the necessity of the opening of the street in the interest of public welfare. (Exh. 17, Annex E, BAVA Petition)Then, on June 10, 1977, the Municipal Engineer of Makati in a letter addressed to BAVA advised the latter to open for vehicular and pedestrian traffic the entire portion of Jupiter Street from Makati Avenue to Reposo Street (Exh. 17, BAVA Petition, par. 14).Finally, on August 12, 1977, the municipal officials of Makati concerned allegedly opened, destroyed and removed the gates constructed/located at the corner of Reposo Street and Jupiter Street as well as the gates/fences located/constructed at Jupiter Street and Makati Avenue forcibly, and then opened the entire length of Jupiter Street to public traffic. (Exh. 17, BAVA Petition, pars. 16 and 17)(11)Before the gates were removed, there was no parking problem or traffic problem in Jupiter Street, because Jupiter Street was not allowed to be used by the general public (Villavicencio, TSN, pp. 24-25, Oct. 30, 1930). However, with the opening of Zodiac Street from Estrella Street to Jupiter Street and also the opening to the public of the entire length of Jupiter Street, there was a tremendous increase in the volume of traffic passing along Jupiter Street coming from EDSA to Estrella Street, then to Zodiac Street to Jupiter Street, and along the entire length of Jupiter Street to its other end at Reposo Street. (Villavicencio, TSN, pp. 30-32, Oct. 30, 1980)In the meantime, the purchasers of the commercial lots between Jupiter Street and Buendia Avenue extension had started constructing their respective buildings in 1974-1975. They demolished the portions of the fence or wall standing within the boundary of their lots. Many of the owners constructed their own fences or walls in lieu of the wall and they employed their own security guards. (TSN, p. 83, Feb. 20, 1931; TSN, pp. 53-54; 72-74, March 20, 1981; TSN, pp. 54-55, July 23, 1981)(12)Then, on January 27, 1978, appellant donated the entire Jupiter Street from Metropolitan Avenue to Zodiac Street to BAVA (Exh. 7). However, even before 1978, the Makati Police and the security force of BAVA were already the ones regulating the traffic along Jupiter Street after the gates were opened in 1977. (Sancianco, TSN, pp. 26-30, Oct. 2, 1981)In October, 1979, the fence at the corner of Orbit and Neptune Streets was opened and removed (BAVA Petition, par. 22, Exh. 17). The opening of the whole stretch of Orbit Street from J.P. Rizal Avenue up to Imelda Avenue and later to Jupiter Street was agreed to at the conference attended by the President of BAVA in the office of the Station Commander of Makati, subject to certain conditions, to wit:"That, maintenance of Orbit St. up to Jupiter St. shall be shouldered by the Municipality of Makati."That, street lights will be installed and maintenance of the same along Orbit St. from J.P. Rizal Ave. up to Jupiter St. shall be undertaken by the Municipality."That for the security of the residents of San Miguel Village and Bel-Air Village, as a result of the opening of Orbit Street, police outposts shall be constructed by the Municipality of Makati to be headed by personnel of Station No. 4, in close coordination with the Security Guards of San Miguel Village and Bel-Air Village." (CF. Exh. 3 to Counter-Affidavit, of Station Commander, Ruperto Acle. p. 253, records)" (Order, Civil Case No. 34948, Exh. 17-c)(13)Thus, with the opening of the entire length of Jupiter Street to public traffic, the different residential lots located in the northern side of Jupiter Street ceased to be used for purely residential purposes. They became, for all purposes, commercial in character.(14)Subsequently, on October 29, 1979, the plaintiffs-appellees Jose D. Sangalang and Lutgarda D. Sangalang brought the present action for damages against the defendant-appellant Ayala Corporation predicated on both breach of contract and on tort or quasi-delict. A supplemental complaint was later filed by said appellees seeking to augment the reliefs prayed for in the original complaint because of alleged supervening events which occurred during the trial of the case. Claiming to be similarly situated as the plaintiffs-appellees, the spouses Felix C. Gaston and Dolores R. Gaston, Jose V. Briones and Alicia R. Briones, and the homeowners' association (BAVA) intervened in the case.(15)After trial on the merits, the then Court of First Instance of Rizal, Pasig, Metro Manila, rendered a decision in favor of the appellees the dispositive portion of which is as follows:"WHEREFORE, judgment is hereby accordingly rendered as follows:ON PLAINTIFFS' COMPLAINT:Defendant is ordered to pay to the plaintiffs-spouses Sangalang the following damages:1.The sum of P500,000.00 as actual and consequential damages;2.The sum of P2,000,000.00 as moral damages;3.The sum of P500,000.00 as exemplary damages;4.The sum of P100,000.00 as attorney's fees; and5.The costs of suit.ON INTERVENORS FELIX and DOLORES GASTON'S COMPLAINT:Defendant is ordered to pay to the spouses Felix and Dolores Gaston, the following damages:1.The sum of P400,000.00 as consequential damages;2.The sum of P500,000.00 as moral damages;3.The sum of P500,000.00 as exemplary damages:4.The sum of P50,000.00 as attorney's fees; and5.The costs of suit.ON INTERVENORS JOSE and ALICIA BRIONES' COMPLAINT:Defendant is ordered to pay to the spouses Jose and Alicia Briones, the following damages:1.The sum of P400,000.00 as consequential damages;2.The sum of P500,000.00 as moral damages;3.The sum of P500,000.00 as exemplary damages;4.The sum of P50,000.00 as attorney's fees; and5.The costs of suit.ON INTERVENOR BAVA'S COMPLAINT:Defendant is ordered to pay intervenor BAVA, the following damages:1.The sum of P400,000.00 as consequential damages;2.The sum of P500,000.00 as exemplary damages3.The sum of P50,000.00 as attorney's fees; and4.The costs of suit.The above damages awarded to the plaintiffs and intervenors shall bear legal interest from the filing of the complaint.Defendant is further ordered to restore/reconstruct the perimeter wall at its original position in 1966 from Reposo Street in the west to Zodiac Street in the east, at its own expense, within SIX (6) MONTHS from finality of judgment.SO ORDERED."(Record on Appeal, pp. 400-401) 2 xxx xxx xxxOn appeal, the Court of Appeals 3 rendered a reversal, and disposed as follows:ACCORDINGLY, finding the decision appealed from as not supported by the facts and the law on the matter, the same is hereby SET ASIDE and another one entered dismissing the case for lack of a cause of action. Without pronouncement as to costs.SO ORDERED. 4 II.G.R. No. 74376This petition was similarly brought by BAVA to enforce the aforesaid restrictions stipulated in the deeds of sale executed by the Ayala Corporation. The petitioner originally brought the complaint in the Regional Trial Court of Makati, 5 "principally for specific performance, plaintiff [now, petitioner] alleging that the defendant [now, private respondent] Tenorio allowed defendant [Tenorio's co-private respondent] Gonzalves to occupy and convert the house at 60 Jupiter Street, Bel-Air Village, Makati, Metro Manila, into a restaurant, without its knowledge and consent, and in violation of the deed restrictions which provide that the lot and building thereon must be used only for residential purposes upon which the prayed-for main relief was for 'the defendants to permanently refrain from using the premises as commercial and to comply with the terms of the Deed Restrictions.'" 6 The trial court dismissed the complaint on a procedural ground, i.e., pendency of an identical action, Civil Case No. 32346, entitled "Bel-Air Village Association, Inc. v. Jesus Tenorio." The Court of Appeals 7 affirmed, and held, in addition, that Jupiter Street "is classified as High density commercial (C-3) zone as per Comprehensive Zoning Ordinance No. 81-01 for National Capital Region," 8 following its own ruling in AC-G.R. No. 66649, entitled "Bel-Air Village Association, Inc. vs. Hy-Land Realty & Development Corporation, et al."III.G.R. No. 76394xxx xxx xxxDefendants-spouses Eduardo V. Romualdez, Jr. and Buena Tioseco are the owners of a house and lot located at 108 Jupiter St., Makati, Metro Manila as evidenced by Transfer Certificate of Title No. 332394 of the Registry of Deeds of Rizal. The fact is undisputed that at the time the defendants acquired the subject house and lot, several restrictions were already annotated on the reverse side of their title; however, for purposes of this appeal we shall quote hereunder only the pertinent ones, to wit:"(b)This lot/s shall be used only for residential purposes."xxx xxx xxx"IV.Term of Restriction.The foregoing restriction(s) shall remain in force for fifty years from January 15, 1957, unless sooner cancelled in its entirety by two-thirds vote of the members in good standing of the Bel-Air Association. However, the Association may from time to time, add new ones, amend or abolish particular restrictions or parts thereof by majority rule."During the early part of 1979, plaintiff noted that certain renovations and constructions were being made by the defendants on the subject premises, for which reason the defendants were advised to inform the plaintiff of the kind of construction that was going on. Because the defendants failed to comply with the request of the plaintiff, the latter's chief security officer visited the subject premises on March 23, 1979 and found out that the defendants were putting up a bake and coffee shop, which fact was confirmed by defendant Mrs. Romualdez herself. Thereafter, the plaintiff reminded defendants that they were violating the deed restriction. Despite said reminder, the defendants proceeded with the construction of the bake shop. Consequently, plaintiff sent defendants a letter dated April 30, 1979 warning them that if they will not desist from using the premises in question for commercial purposes, they will be sued for violations of the deed restrictions.Despite the warning, the defendants proceeded with the construction of their bake shop. 9 xxx xxx xxxThe trial court 10 adjudged in favor of BAVA. On appeal, the Court of Appeals 11 reversed, on the strength of its holding in AC-G.R No. 66649 earlier referred to.BAVA then elevated the matter to the Court by a petition for review on certiorari. The Court 12 initially denied the petition "for lack of merit, it appearing that the conclusions of the respondent Court of Appeals that private respondents' bake and coffee shop lies within a commercial zone and that said private respondents are released from their obligations to maintain the lot known as 108 Jupiter Street for residential purposes by virtue of Ordinance No. 81 of the Municipality of Makati and Comprehensive Zoning Ordinance No. 81-01 of the Metropolitan Manila Commission, are in accord with law and jurisprudence," 13 for which BAVA sought a reconsideration. Pending resolution, the case was referred to the Second Division of this Court, 14 and thereafter, to the Court En Banc en consulta. 15 Per our Resolution, dated April 29, 1988, we consolidated this case with G.R. Nos. 74376 and 82281. 16 IV.G.R. No. 78182.xxx xxx xxxThe case stemmed from the leasing by defendant Dolores Filley of her building and lot situated at No. 205 Reposo Street, Bel-Air Village Makati, Metro Manila to her co-defendant, the advertising firm J. Romero and Associates, in alleged violation of deed restrictions which stipulated that Filley's lot could only be used for residential purposes. Plaintiff sought judgment from the lower court ordering the defendants to "permanently refrain" from using the premises in question "as commercial" and to comply with the terms of the deed restrictions.After the proper proceedings, the court granted the plaintiff the sought-for relief with the additional imposition of exemplary damages of P50,000.00 and attorney's fees of P10,000.00. The trial court gave emphasis to the restrictive clauses contained in Filley's deed of sale from the plaintiff, which made the conversion of the building into a commercial one a violation.Defendants now seek review and reversal on three (3) assignments of errors, namely:I.THE TRIAL COURT ERRED IN NOT FINDING THAT THE REGULATIONS PROMULGATED BY THE MUNICIPAL AUTHORITIES IN MAKATI AND THE MINISTRY OF HUMAN SETTLEMENTS CHANGING THE CHARACTER OF THE AREAS IN QUESTION HAD RENDERED THE RESTRICTIVE EASEMENT ON THE TITLE OF THE APPELLANTS VACATED.II.THE COURT ERRED IN NOT RULING THAT BECAUSE THE APPELLEE(S) HAD ALLOWED THE USE OF THE PROPERTY WITHIN THE VILLAGE FOR NON-RESIDENTIAL PURPOSES, IT IS NOW ESTOPPED FROM ENFORCING THE RESTRICTIVE PROHIBITIONS SUBJECT MATTER OF THIS CASE.III.THE COURT ERRED IN NOT FINDING THAT THERE EXISTED A BILATERAL CONTRACT BETWEEN THE PARTIES AND THAT SINCE APPELLEE HAD NOT PERFORMED ITS OBLIGATIONS UNDER THIS ARRANGEMENT THE APPELLANT IN TURN WAS UNDER NO OBLIGATION TO ANNOTATE THE RESTRICTIVE PROHIBITIONS ON THE BACK OF THE TITLE.Appellants anchor their appeal on the proposition that the Bel-Air Village area, contrary to plaintiff-appellee's pretension of being a strictly residential zone, is in fact commercial and characterize the restrictions contained in appellant Filley's deed of sale from the appellee as completely outmoded, which have lost all relevance to the present-day realities in Makati, now the premier business hub of the nation, where there is a proliferation of numerous commercial enterprises established through the years, in fact even within the heart of so-called "residential" villages. Thus, it may be said that appellants base their position on the inexorable march of progress which has rendered at naught the continued efficacy of the restrictions. Appellant on the other hand, relies on a rigid interpretation of the contractual stipulations agreed upon with appellant Filley, in effect arguing that the restrictions are valid ad infinitum.The lower court quite properly found that other commercial establishments exist in the same area (in fact, on the same street) but ignored it just the same and said "The fact that defendants were able to prove the existence of several commercial establishments inside the village does not exempt them from liability for violating some of the restrictions."evidently choosing to accord primacy to contractual stipulation. 17 xxx xxx xxxThe Court of Appeals 18 overturned the lower court, 19 likewise based on AC-G.R. No. 66649. The respondent Court observed also that J. Romero & Associates had been given authority to open a commercial office by the Human Settlements Regulatory Commission.V.G.R. No. 82281The facts of this case have been based on stipulation. We quote:"COMES NOW, the Parties, assisted by their respective counsel and to this Honorable Court, respectfully enter into the following stipulations of facts, to wit:1.The parties admit the personal circumstances of each other as well as their capacities to sue and be sued.2.The parties admit that plaintiff (BAVA for short) is the legally constituted homeowners' association in Bel-Air Subdivision, Makati, Metro Manila.3.The parties admit that defendant Violeta Moncal is the registered owner of a parcel of land with a residential house constructed thereon situated at No. 104 Jupiter Street, Bel-Air Village, Makati, Metro Manila; that as such lot owner, she is a member of the plaintiff association.4.The parties admit that defendant Majal Development Corporation (Majal for short) is the lessee of defendant Moncal's house and lot located at No. 104 Jupiter Street.5.The parties admit that a deed restrictions is annotated on the title of defendant Moncal, which provides, among others, that the lot in question must be used only for residential purposes;" that at time Moncal purchased her aforesaid lot in 1959 said deed restrictions was already annotated in the said title.6.The parties admit that when Moncal leased her subject property to Majal, she did not secure the consent of BAVA to lease the said house and lot to the present lessee.7.The parties admit that along Jupiter Street and on the same side where Moncal's property is located, there are restaurants, clinics, placement or employment agencies and other commercial or business establishments. These establishments, however, were sued by BAVA in the proper court.8.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.9.The parties admit that subsequent thereto, Ayala tore down the perimeter wall to give way to the commercial building fronting Buendia Avenue (now Gil J. Puyat Avenue).10.The parties admit that 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.11.The parties admit plaintiffs letters of October 10, 23 and 31, 1984; as well as defendants' letters-reply dated October 17 and 29, 1984. 20 xxx xxx xxxThe trial court 21 dismissed the petitioner's complaint, which dismissal was affirmed on appeal. 22 According to the appellate court, the opening of Jupiter Street to human and vehicular traffic, and the commercialization of the Municipality of Makati in general, were circumstances that had made compliance by Moncal with the aforesaid "deed restrictions" "extremely difficult and unreasonable," 23 a development that had excused compliance altogether under Article 1267 of the Civil Code.VI.The cases before the Court; the Court's decision.In brief, G.R. Nos. 74376, 76394, 78182, and 82281 are efforts to enforce the "deed restrictions" in question against specific residents (private respondents in the petitions) of Jupiter Street and with respect to G.R. No. 78182, Reposo Street. The private respondents are alleged to have converted their residences into commercial establishments (a restaurant in G.R. No. 74376, a bakery and coffee shop in G.R. No. 76394, an advertising firm in G.R. No. 78182; and a construction company, apparently, in G.R. No. 82281) in violation of the said restrictions. 24 Their mother case, G. R. No. 71169 is, on the other hand, a petition to hold the vendor itself, Ayala Corporation (formerly Makati Development Corporation), liable for tearing down the perimeter wall along Jupiter Street that had theretofore closed its commercial section from the residences of Bel-Air Village and ushering in, as a consequence, the full "commercialization" of Jupiter Street, in violation of the very restrictions it had authored.As We indicated, the Court of Appeals dismissed all five appeals on the basis primarily of its ruling in AC-G.R. No. 66649, "Bel-Air Village, Inc. v. Hy-Land Realty Development Corporation, et al.," in which the appellate court explicitly rejected claims under the same "deed restrictions" as a result of Ordinance No. 81 enacted by the Government of the Municipality of Makati, as well as Comprehensive Zoning Ordinance No. 8101 promulgated by the Metropolitan Manila Commission, which two ordinances allegedly allowed the use of Jupiter Street both for residential and commercial purposes. It was likewise held that these twin measures were valid as a legitimate exercise of police power.The Court of Appeals' reliance on Ordinance Nos. 81 and 8101 is now assailed in these petitions, particularly the Sangalang, et al. petition.Aside from this fundamental issue, the petitioners likewise raise procedural questions. G.R. No. 71169, the mother case, begins with one.1. G.R. No. 71169In this petition, the following questions are specifically put to the Court:May the Honorable Intermediate Appellate Court reverse the decision of the trial court on issues which were neither raised by AYALA in its Answers either to the Complaint or Supplemental Complaint nor specifically assigned as one of the alleged errors on appeal? 25 May the Honorable Intermediate Appellate Court arbitrarily ignore the decisive findings of fact of the trial court, even if uncontradicted and/or documented, and premised mainly on its own unsupported conclusions totally reverse the trial court's decision? 26 May the Honorable Intermediate Appellate Court disregard the trial court's documented findings that respondent Ayala for its own self-interest and commercial purposes contrived in bad faith to do away with the Jupiter Street perimeter wall it put up three times which wall was really intended to separate the residential from the commercial areas and thereby insure the privacy and security of Bel-Air Village pursuant to respondent Ayala's express continuing representation and/or covenant to do so? 27 a.The first question represents an attack on the appellate court's reliance on Ordinances Nos. 81 and 81-01, a matter not supposedly taken up at the trial or assigned as an error on appeal. As a rule, the Court of Appeals (then the Intermediate Appellate Court) may determine only such questions as have been properly raised to it, yet, this is not an inflexible rule of procedure. In Hernandez v. Andal, 28 it was stated that "an unassigned error closely related to an error properly assigned, or upon which the determination of the question raised by the error properly assigned is dependent, will be considered by the appellate court notwithstanding the failure to assign it as error." 29 In Baquiran v. Court of Appeals, 30 we referred to the "modern trend of procedure . . . accord[ing] the courts broad discretionary power," 31 and in which we allowed consideration of matters "having some bearing on the issue submitted which the parties failed to raise or the lower court ignore[d]." 32 And in Vda. de Javellana v. Court of Ap