M. RELATIVE AND QUALIFYING TERMS (#73)

RELATIVE AND QUALIFYING TERMS (#73)Republic of the PhilippinesSUPREME COURTManilaSECOND DIVISIONG.R. No. 78585 July 5, 1989JOSE ANTONIO MAPA,petitioner,vs.HON. JOKER ARROYO, in his Capacity as Executive Secretary, and LABRADOR DEVELOPMENT CORPORATION,respondents.Francisco T. Mamaug for petitioner.Emiliano S. Samson for private respondent.REGALADO,J.:We are called upon once again, in this special civil action forcertiorari, for a pronouncement as to whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the executive branch of Government, particularly in the adjudication of a controversy originally commenced in one of its regulatory agencies.

Petitioner herein seeks the reversal of the decision of the Office of the President, rendered by the Deputy Executive Secretary on April 24,1987,1which dismissed his appeal from the resolution of the Commission Proper, Human Settlements Regulatory Commission (HSRC, for short), promulgated on January 10, 1986 and affirming the decision of July 3, 1985 of the Office of Adjudication and Legal Affairs (OAALA, for brevity) of HSRC. Petitioner avers that public respondent "gravely transcended the sphere of his discretion" in finding that Presidential Decree No. 957 is inapplicable to the contracts to sell involved in this case and in consequently dismissing the same.2The established facts on which the assailed decision is based are set out therein as follows:

Records disclose that, on September 18, 1975, appellant Jose Antonio Mapa and appellee Labrador Development Corporation (Labrador, for short), owner/developer of the Barangay Hills Subdivision in Antipolo, Rizal, entered into two contracts to sell over lots 12 and 13 of said subdivision. On different months in 1976, they again entered into two similar contracts involving lots 15 and 16 in the same subdivision. Under said contracts, Mapa undertook to make a total monthly installment of P2,137.54 over a period of ten (10) years. Mapa, however, defaulted in the payment thereof starting December 1976, prompting Labrador to send to the former a demand letter, dated May 5, 1977, giving him until May 18, 1977, within which to settle his unpaid installments for the 4 lots amounting to P15,411.66, with a warning that non-payment thereof will result in the cancellation of the four (4) contracts. Despite receipt of said letter on May 6,1977, Mapa failed to take any action thereon. Labrador subsequently wrote Mapa another letter, dated June 15, 1982, which the latter received on June 21, 1982, reminding him of his total arrears amounting to P180,065.27 and demanding payment within 5 days from receipt thereof, but which letter Mapa likewise ignored. Thus, on August 16, 1982, Labrador sent Mapa a notarial cancellation of the four (4) contracts to sell, which Mapa received on August 20, 1982. On September 10, 1982, however, Mapa's counsel sent Labrador a letter calling Labrador's attention to, and demanding its compliance with, Clause 20 of the four (4) contracts to sell which relates to Labrador's obligation to provide, among others, lighting/water facilities to subdivision lot buyers.

On September 10, 1982, Labrador issued a certification holding the implementation of the letter dated August 16, 1982 (re notarial cancellation) pending the complete development of road lot cul de sac within the properties of Mapa at Barangay Hills Subdivision.' Thereafter on October 25,1982, Labrador sent Mapa a letter informing him 'that the construction of road, sidewalk, curbs and gutters adjacent to Block 11 Barangay Hills Subdivision are already completed' and further requesting Mapa to 'come to our office within five (5) days upon receipt of this letter to settle your account.'

On December 10, 1982, Mapa tendered payment by means of a check in the amount of P 2,137.54, but Labrador refused to accept payment for the reason that it was agreed 'that after the development of the cul de sac, he (complainant) will pay in full the total amount due,' which Labrador computed at P 260,138.61. On December 14, 1982, Mapa wrote Labrador claiming that 'you have not complied with the requirements for water and light facilities in lots 12, 13, 15 & 16 Block 2 of Barangay Hills Subdivision.' The following day, Mapa filed a complaint against Labrador for the latter's neglect to put 1) a water system that meets the minimum standard as specified by HSRC, and 2) electrical power supply. By way of relief, Mapa requested the HSRC to direct Labrador to provide the facilities aforementioned, and to issue a cease and desist order enjoining Labrador from cancelling the contracts to sell.

After due hearing/investigation, which included an on-site inspection of the subdivision, OAALA, issued its decision of July 3, 1985, dismissing the complaint and declaring that after the lapse of 5 years from complainant's default respondent had every right to rescind the contract pursuant to Clause 7 thereof. . .

Per its resolution of January 10, 1986, the Commission Proper, HSRC, affirmed the aforesaid OAALA decision.3It was petitioner's adamant submission in the administrative proceedings that the provisions of Presidential Decree No. 9574and implementing rules form part of the contracts to sell executed by him and respondent corporation, hence the obligations imposed therein had to be complied with by Labrador within the period provided. Since, according to petitioner, Labrador failed to perform the aforementioned obligations, it is precluded from rescinding the subject contracts to sell since petitioner consequently did not incur in delay on his part.

Such intransigent position of petitioner has not changed in the petition at bar and unyielding reliance is placed on the provisions of Presidential Decree No. 957 and its implementing rules. The specific provisions of the Decree which are persistently relied upon read:

SEC. 20.Time of Completion. Every owner or developer shall construct and provide the facilities, improvements, infrastructures and other forms of development, including water supply and lighting facilities, which are offered and indicated in the approved subdivision or condominium plans, brochures, prospectus, printed matters letters or in any form of advertisements, within one year from the date of the issuance of the license for the subdivision or condominium project or such other period of time as may be fixed by the Authority.

SEC. 21.Sales Prior to Decree. In cases of subdivision lots or condominium units sold or disposed of prior to the effectivity of this Decree, it shall be incumbent upon the owner or developer of the subdivision or condominium project to complete compliance with his or its obligations as provided in the preceding section within two years from the date of this Decree unless otherwise extended by the Authority or unless an adequate performance bond is filed in accordance with Section 6 hereof.

Failure of the owner or developer to comply with the obligations under this and the preceding provisions shall constitute a violation punishable under Sections 38 and 39 of this Decree.

Rule V of the implementing rules, on the other hand, requires two (2) sources of electric power, two (2) deep-well and pump sets with a specified capacity and two standard fire hose flows with a capacity of 175 gallons per minute.5The provision, in said contracts to sell which, according to petitioner, includes and incorporates the aforequoted statutory provisions, is Clause 20 of said contracts which provides:

Clause 20. SUBDIVISION DEVELOPMENT To insure the physical development of the subdivision, the SELLER hereby obliges itself to provide the individual lot buyer with the following:

a) PAVED ROADS

b) UNDERGROUND DRAINAGE

c) CONCRETE CURBS AND GUTTERS

d) WATER SYSTEM

e) PARK AND OPEN SPACE

These improvements shall apply only to the portions of the subdivision which are for sale or have been sold. All improvements except those requiring the services of a public utility company or the government shall be completed within a period of three (3) years from date of this contract. Failure by the SELLER to reasonably comply with the above schedule shall permit the BUYER/ S to suspend his monthly installments without any penalties or interest charges until such time that these improvements shall have been made as scheduled.6As recently reiterated, it is jurisprudentially settled that absent a clear, manifest and grave abuse of discretion amounting to want of jurisdiction, the findings of the administrative agency on matters falling within its competence will not be disturbed by the courts.7Specifically with respect to factual findings, they are accorded respect, if not finality, because of the special knowledge and expertise gained by these tribunals from handling the specific matters falling under their jurisdiction. Such factual findings may be disregarded only if they "are not supported by evidence; where the findings are vitiated by fraud, imposition or collusion; where the procedure which led to the factual findings is irregular; when palpable errors are committed; or when grave abuse of discretion, arbitrariness or capriciousness is manifest."8A careful scrutiny of the records of the instant case reveals that the circumstances thereof do not fag under the aforesaid excepted cases, with the findings duly supported by the evidence.

Petitioner's insistence on the applicability of Presidential Decree No. 957 must be rejected. Said decree was issued on July 12, 1976 long after the execution of the contracts involved. Obviously and necessarily, what subsequently were statutorily provided therein as obligations of the owner or developer could not have been intended by the parties to be a part of their contracts. No intention to give restrospective application to the provisions of said decree can be gathered from the language thereof. Section 20, in relation to Section 21, of the decree merely requires the owner or developer to construct the facilities, improvements, infrastructures and other forms of development but only such as are offered and indicated in the approved subdivision or condominium plans, brochures, prospectus, printed matters, letters or in any form of advertisements. Other than what are provided in Clause 20 of the contract, no further written commitment was made by the developer in this respect. To read into the contract the matters desired by petitioner would have the law impose additional obligations on the parties to a contract executed before that very law existed or was contemplated.

We further reject petitioner's strained and tenuous application of the so-called doctrine of last antecedent in the interpretation of Section 20 and, correlatively, of Section 21. He would thereby have the enumeration of "facilities, improvements, infrastructures and other forms of development" interpreted to mean that the demonstrative phrase "which are offered and indicated in the approved subdivision plans, etc." refer only to "other forms of development" and not to "facilities, improvements and infrastructures." While this subserves his purpose, such bifurcation whereby the supposed adjectival phrase is set apart from the antecedent words, is illogical and erroneous. The complete and applicable rule isad proximum antecedens fiat relatio nisi impediatur sentencia.9Relative words refer to the nearest antecedent, unless it be prevented by the context. In the present case, the employment of the word "and" between "facilities, improvements, infrastructures" and "other forms of development," far from supporting petitioner's theory, enervates it instead since it is basic in legal hermeneutics that "and" is not meant to separate words but is a conjunction used to denote a joinder or union.Thus, if ever there is any valid ground to suspend the monthly installments due from petitioner, it would only be based on non-performance of the obligations provided in Clause 20 of the contract, particularly the alleged non-construction of the cul-de-sac. But, even this is unavailing and is obviously being used only to justify petitioner's default. The on-site inspection of the subdivision conducted by the OAALA and its subsequent report reveal that Labrador substantially complied with its obligation.10Furthermore, the initial non-construction of the cul-de-sac, as private respondent Labrador explained, was because petitioner Mapa requested the suspension of its construction since his intention was to purchase the adjoining lots and thereafter enclose the same.11If these were not true, petitioner would have invoked that supposed default in the first instance. As the OAALA noted, petitioner "stopped payments of his monthly obligations as early as December, 1976, which is a mere five months after the effectivity of P.D. No. 957 or about a year after the execution of the contracts. This means that respondent still has 1 and 1/2 years to comply with its legal obligation to develop the subdivision under said P.D. and two years to do so under the agreement, hence, it was improper for complainant to have suspended payments in December, 1976 on the ground of non-development since the period allowed for respondent's obligation to undertake such development has not yet expired."12ON THE FOREGOING CONSIDERATIONS, the petition should be, as it is hereby DISMISSED.

SO ORDERED.

USE OF PUNCTUATION MARKS (#74)

FIRST DIVISION

[G.R. No. 8848. November 21, 1913. ]

THE UNITED STATES,Plaintiff-Appellee, v. WILLIAM C. HART,C.J.MILLER, and SERVILLANO NATIVIDAD,Defendants-Appellants.

Pedro Abad Santos for appellants Hart and Natividad.

W.H. Booram for appellant Miller.

Solicitor-General Harvey forAppellee.

SYLLABUS1. VAGRANCY; LOITERING ABOUT SALOONS, DRAM SHOPS, OR GAMBLING HOUSES; VISIBLE MEANS OF SUPPORT. A person is not guilty of vagrancy under the second paragraph of section 1 of the Vagrancy Act for frequenting saloons, dram shops, or gambling houses, unless it be shown that he is without visible means of support.

2. STATUTORY CONSTRUCTION; PUNCTUATION EMPLOYED. If the punctuation of a statute gives it a meaning which is reasonable and in apparent accord with the legislative will, it may be used as an additional argument for adopting the literal meaning of the words of a statute as thus punctuated. But an argument based upon punctuation alone is not conclusive, and the courts will not hesitate change the punctuation when necessary, to give to the Act the effect intended by the Legislature, disregarding superfluous or incorrect punctuation marks, and inserting others where necessary.D E C I S I O NTRENT,J.:The appellants, Hart, Miller, and Natividad, were arraigned in the Court of First Instance of Pampanga on a charge of vagrancy under the provision of Act No. 519, found guilty, and were each sentenced to six months imprisonment. Hart and Miller were further sentenced to a fine of P200, and Natividad to a fine of P100. All appealed.

The evidence of the prosecution as to the defendant Hart shows that he pleaded guilty and was convicted on a gambling charge about two or three weeks before his arrest on the vagrancy charge; that he had been conducting two gambling games, one in his saloon and the other in another house, for a considerable length of time, the games running every night. The defense showed that Hart and one Dunn operated a hotel and saloon at Angeles which did a business, according to the bookkeeper, of P96,000 during the nineteen months preceding the trial; that Hart was also the sole proprietor of a saloon in the barrio of Tacondo; that he raised imparted hogs which he sold to the Army garrison at Camp Stotsenberg, which business netted him during the preceding year about P4,000; that he was authorized to sell several hundred hectares of land owned by one Carrillo in Tacondo; that he administered, under power of attorney, the same property; and that he furnished a building for and paid the teacher of the first public school in Tacondo, said school being under Government supervision. The evidence of the prosecution as to Miller was that he had the reputation of being a gambler; that he pleaded guilty and was fined for participating in a gambling game about two weeks before his arrest on the present charge of vagrancy; and that he was seen in houses of prostitution and in a public dance hall in Tacondo on various occasions. The defense showed without contradiction that Miller had been discharged from the Army about the year previously; that during his term of enlistment he had been made sergeant; that he received rating as "excellent" on being discharged; that since his discharge he had been engaged in tailoring business near Camp Stotsenberg under articles of partnership with one Buckerd, Miller having contributed P1,000 to the partnership; that the business netted each partner about P300 per month; that Miller attended to business in an efficient manner every day; and that his work was first class.

The evidence of the prosecution as to Natividad was that he had gambled nearly every night for a considerable time prior to his arrest on the charge of vagrancy, in the saloon of one Raymundo, as well as in Harts saloon; that Natividad sometimes acted as banker; and that he had pleaded guilty to a charge of gambling and had been sentenced to pay a fine therefor about two weeks before his arrest on the vagrancy charge. The defense showed that Natividad was a tailor, married, and had a house of his own; that he made good clothes, and earned from P80 to P100 per month, which was sufficient to support his family.

From his evidence it will be noted that each of the defendants was earning a living at a lawful trade or business, quite sufficient to support himself in comfort, and that the evidence which the prosecution must rely upon for a conviction consists of their having spent their evenings in regularly licensed saloons, participating in gambling games which are expressly made unlawful by the Gambling Act, No. 1757, and that Miller frequented a dance hall and houses of prostitution.

Section 1 of Act No. 519 is divided into seven clauses, separated by semicolons. Each clause enumerates a certain calls of person who, within the meaning of this statute, are to be considered as vagrants. For the purpose of this discussion, we quote this section below, and number each of these seven clauses.

"(1) Every person having no apparent means of subsistence, who had the physical ability to work, and who neglects to apply himself or herself to some lawful calling; (2) every person found loitering about saloons or dram shops or gambling housed, or tramping or straying through the country without visible means of support; (3) every person known to be a pickpocket, thief, burglar, ladrone, either by his own confession or by his having been convicted of either said offenses, and having no visible or lawful means of support when found loitering about any gambling house, cockpit, or in any outlying barrio of a pueblo; (4) every idle or dissolute person of associate of known thieves or ladrones who wanders about the country at unusual hours of the night; (5) every idle person who lodges in any barn, shed, outhouse, vessel, or place other than such as is kept for lodging purposed, without the permission of the owner or a person entitled to the possession thereof; (6) every lewd or dissolute person who lives in and about houses of ill fame; every common prostitute and common drunkard, is a vagrant."cralaw virtua1aw library

It is insisted by the Attorney-General that as visible means of support would not be a bar to a conviction under any one of the last four clauses of this act, it was not the intention of the Legislature to limit the crime of vagrancy to those having no visible means of support. Relying upon the second clause to sustain the guilt of the defendant, the Attorney-General then proceeds to argue that "visible means of support" as used in that clause does not apply to "every person found loitering about saloons or dram shops on gambling houses," but is confined entirely to "or tramping or straying through the country." It is insisted that had it been intended for "without visible means of support" to qualify the first part of the clause, either the comma after gambling house would have been omitted, or else a comma after country would have been inserted.

When the meaning of legislative enactment is in question, it is the duty of the courts to ascertain, if possible, the true legislative intention, and adopt that the construction of the statute of the statute which will give it effect. The construction finally adopted should be based upon something more substantial than the mere punctuation found in the printed Act. If the punctuation of the statute gives it a meaning which is reasonable and in apparent accord with the legislative will, it may be used as an additional argument for adopting the literal meaning of the words of the statute as thus punctuated. But an argument based upon punctuation alone is not conclusive, and the courts will not hesitate to a change the punctuation when necessary, to give to the Act the effect intended by the Legislature, disregarding superfluous or incorrect punctuation marks, and inserting others where necessary.

The Attorney-General has based his argument upon the proposition that neither visible means of support not a lawful calling is a sufficient defense under the last four paragraphs of the section; hence, not being universally a defense to a charge of vagrancy, they should not be allowed except where the Legislature has so provided. He then proceeds to show, by a "mere grammatical criticism: of the second paragraph, that the Legislature did not intend to allow visible means of support or a lawful calling to block a prosecution for vagrancy founded on the charge that the defendant was found loitering around saloons, dram shops, and gambling houses.

A most important step in this reasoning, necessary to make it sound, is to ascertain the consequences flowing from such a construction of the law. What is loitering? The dictionaries say it is idling or wasting ones time. The time spent in saloons, dram shops, and gambling houses is seldom anything but that. So that under the proposed construction, practically all who frequent such places commit a crime in so doing, for which they are liable to punishment under the Vagrancy Law. We cannot believe that it was the intention of the Legislature to penalize what, in the case of saloons and dram shops, is under the laws protection. If it be urged that what is true of saloons and dram shops is not true of gambling houses in this respect, we encounter the wording of the law, which makes no distinction whatever between loitering around saloon and dram shops, and loitering around gambling houses.

The offense of vagrancy and defined in Act No. 519 is the Anglo-Saxon method of dealing with the habitually idle and harmful parasites society. While the statutes of the various States of the American Union differ greatly as to the classification of such persons, their scope is substantially the same. Of those statutes we have had an opportunity to examine, but two or three contain a provision similar to the second paragraph of Act No. 519. (Mo. Ann. Stat., sec. 2228; sec 1314.) That the absence of visible means of support or a lawful calling is necessary under these statutes to a conviction for loitering around saloons, dram shops, and gambling houses is not even negatived by the punctuation employed. In the State of Tennessee, however, we find an exact counterpart for paragraph 2 of section 1 of our own Act (Code of Tenn., sec 3023), with the same punctuation:jgc:chanrobles.com.ph

". . . or for any person to be found loitering about saloons or dram shops, gambling houses, or houses of ill fame, or tramping or strolling through the country without any visible means of support."cralaw virtua1aw library

A further thought suggests itself on connection with the punctuation of the paragraph in question. The section, as stated above, is divided into seven clauses, separated by semicolons. To say that two classes of vagrants are defined in paragraph 2, as to one of which visible means of support or a lawful calling is not a good defense, and as to the other which such a defense is sufficient, would imply a lack of logical classification on the part of the legislature of the various classes of vagrants. this we are not inclined to do.

In the case at bar, all three of the defendants were earning a living by legitimate methods in a degree of comfort higher than the average. Their sole offense was gambling, which the legislature deemed advisable to make the subject of a penal law. the games in which they participated were apparently played openly, in a licenses public saloon, where the officers of the law could have entered as easily as did the patrons. It is believed that Act No. 1757 is adequate, if enforced, to suppress the gambling proclivities of any person making a good living ar a lawful trade of business.

For these reasons, the defendants are acquitted, with the costs de oficio.

Arellano,C.J., Torres and Carson,JJ., concur.

Johnson and Moreland,JJ., concur the result.WORDS AND PHRASES:

PROVISO (#75)

Republic of the PhilippinesSUPREME COURTManilaEN BANCG.R. No. L-14880 April 29, 1960COMMISSIONER OF INTERNAL REVENUE,petitioner,vs.FILIPINAS COMPAIA DE SEGUROS,respondent.Assistant Solicitor General Jose P. Alejandro and Special Attorney Jaime M. Maza for petitioner.Ramon T. Garcia for respondent.BARRERA,J.:Respondent Filipinas Compaia de Seguros, an insurance company, is also engaged in business as a real estate dealer. On January 4, 1956, respondent, in accordance with the single rate then prescribed under Section 182 of the National Internal Revenue Code.1paid the amount of P150.00 as real estate dealer's fixed annual tax for the year 1956. Subsequently said Section 182 of the Code was amended by Republic Act No. 1612, which took effect on August 24, 1956, by providing a small of graduated rates: P150 if the annual income of the real estate dealer from his business as such is P4,000, but does not exceed P10,000; P300, if such annual income exceeds P10,000 but does not exceed P30,000; and P500 if such annual income exceeds P30,000.On June 17, 1957, petitioner Commissioner of Internal Revenue assessed and demanded from respondent (whose annual income exceeded P30,000.00) the amount of P350.00 as additional real estate dealer's fixed annual tax for the year 1956. On July 16, 1957, respondent wrote a letter to petitioner stating that the "records will show that the real estate dealer's fixed tax for 1956 of this Company was fully paid by us prior to the effectivity of Republic Act No. 1612 which amended, among other things, Sections 178 and 192 of the National Internal Revenue Code." And, as to the retroactive effect of said Republic Act No. 1612, respondent added that the Republic Act No. 1856 which, among other things, amended Section 182 of the National Internal Revenue Code, Congress has clearly shown its intention when it provided that the increase in rates of taxes envisioned by Republic Act No. 1612 is to be made effective as of 1 January 1957".On October 23, 1957, petitioner informed respondent that "Republic Act No. 1856 which took effect June 22, 1957 amended the date of effectivity of Republic Act 1612 to January 1, 1957. However, the said amendment applies only to fixed taxes on occupation and not to fixed taxes on business." Hence, petitioner insisted that respondent should pay the amount of P350.00 as additional real estate dealer's fixed annual tax for the year 1956.On November 20, 1957, respondent filed with the Court of Tax Appeals a petition for review. To this petition, petitioner filed his answer on December 6, 1957. As petitioner practically admitted the material factual allegations in the petition for review, the case was submitted for judgment on the pleadings.On November 22, 1958, the Court of Tax Appeals rendered a decision sustaining the contention of respondent company and ordering the petitioner Commissioner of Internal Revenue to desist from collecting the P350.00 additional assessment. From this decision, petitioner appealed to us.As a rule, laws have no retroactive effect, unless the contrary is provided. (Art. 4, Civil Code of the Philippines; Manila Trading and Supply Co. vs. Santos, et al., 66 Phil., 237; La Provisora Filipina vs. Ledda, 66 Ph 573.) Otherwise stated, a state shou!d be consider as prospective in its operation whether it enacts, amen or repeals a tax, unless the language of the statute clearly demands or expresses that it shall have a retroactive effect (61 C. J. 1602, cited in Loremo vs. Posadas, 64 Phi 353.) The rule applies with greater force to the case bar, considering that Republic Act No. 1612, which imposes the new and higher rates of real estate dealer's annual fixed tax, expressly provides in Section 21 thereof the said Act "shall take effect upon its approval" on August 24, 1956.The instant case involves the fixed annual real estat dealer's tax for 1956. There is no dispute that before the enactment of Republic Act No. 1612 on August 2 1956, the uniform fixed annual real estate dealer's was P150.00 for all owners of rental properties receiving an aggregate amount of P3,000.00 or more a year in the form of rentals2and that. "the yearly fixed taxes are due on the first of January of each year" unless tendered in semi-annual or quarterly installments.3Since the petitioner indisputably paid in full on January 4, 1956, the total annual tax then prescribed for the year 1956, require it to pay an additional sum of P350.00 to complete the P500.00 provided in Republic Act No. 1612 which became effective by its very terms only on August 24 1956, would, in the language of the Court of Tax Appeals result in the imposition upon respondent of a tax burden to which it was not liable before the enactment of said amendatory act, thus rendering its operation retroactive rather than prospective, which cannot be done, as it would contravene the aforecited Section 21 of Republic Act No. 1612 as well as the established rule regarding prospectivity of operation of statutes.The view that Congress did intend to impose said increased rates of real estate dealer's annual tax prospectively and not retroactively, finds some affirmation in Republic Act No. 1856, approved on June 22, 1957, which fixed the effective date of said new rates under Republic Act No. 1612 by inserting the following proviso in Section 182 of the National Internal Revenue Code:Provided, further, That any amount collected in excess of the rates in effect prior to January one, nineteen hundred and fifty-seven, shall be refunded or credited to the taxpayer concerned subject to the provisions of section three hundred and nine of this Code. (Sec. 182 (b) (2) (1).)Petitioner, however, contends that the above-quoted provision refers only to fixed taxes on occupation and does not cover fixed taxes on business, such as the real estate dealer's fixed tax herein involved. This is technically correct, but we note from the deliberations in the Senate, where the proviso in question was introduced as an amendment, that said House Bill No. 5919 which became Republic Act No. 1856 was considered, amended, and enacted into law, in order precisely that the "iniquitous effects" which were then being felt by taxpayers. in general, on account of the approval of Republic Act No. 1612, Which was being given retroactive effect by the Bureau of Internal Revenue by collecting these taxes retroactively from January 1, 1956, be eliminated and complaints against such action be finally settled. (See Senate Congressional Record, May 4, 1957, pp. 10321033.)It is also to be observed that said House Bill No. 5819 as originally presented, was expressly intended to amend certain provisions of the National Internal Revenue Code dealing on fixed taxeson business. The provisions in respect of fixed taxon occupationwere merely subsequently added. This would seem to indicate that the proviso in question was intended to cover not only fixed taxes on occupation, but also fixed taxes on business. (Senate Congressional Record, March 7, 1957, p. 444.)The fact that said proviso was placed only at the end of paragraph "(B) On occupation" is not, therefore, view of the circumstances, decisive and unmistakable indication that Congress limited the proviso to occupation taxes.Even though the primary purpose of the proviso is to limit restrain the general language of a statute, the legislature, unfotunately, does not always use it with technical correctness; consequently, where its use creates an ambiguity, it is the duty of the court to ascertain the legislative intention, through resort to usual rules of construction applicable to statutes, generally an give it effect even though the statute is thereby enlarged, or the proviso made to assume the force of an independent enactment and although a proviso as such has no existence apart from provision which it is designed to limit or to qualify. (Statutory Construction by E. T. Crawford, pp. 604-605.). . . When construing a statute, the reason for its enactment should be kept in mind, and the statute should be construe with reference to its intended scope and purpose. (Id. at p. 249.)On the general principle of prospectivity of statute on the language of Republic Act 1612 itself, especially Section 21 thereof, and on the basis of its intended scope and purpose as disclosed in the Congressional Record we find ourselves in agreement with the Court of Tax Appeals.Wherefore, the decision appealed from is hereby affirmed without costs. So ordered.#76

Republic of the PhilippinesSUPREME COURTManilaSECOND DIVISIONG.R. No. 79869 September 5, 1991FORTUNATO MERCADO, SR., ROSA MERCADO, FORTUNATO MERCADO, JR., ANTONIO MERCADO, JOSE CABRAL, LUCIA MERCADO, ASUNCION GUEVARA, ANITA MERCADO, MARINA MERCADO, JULIANA CABRAL, GUADALUPE PAGUIO, BRIGIDA ALCANTARA, EMERLITA MERCADO, ROMEO GUEVARA, ROMEO MERCADO and LEON SANTILLAN,petitioners,vs.NATIONAL LABOR RELATIONS COMMISSION (NLRC), THIRD DIVISION; LABOR ARBITER LUCIANO AQUINO, RAB-III; AURORA L. CRUZ; SPOUSES FRANCISCO DE BORJA and LETICIA DE BORJA; and STO. NIO REALTY, INCORPORATED,respondents.Servillano S. Santillan for petitioners.Luis R. Mauricio for private respondents.PADILLA,J.:pAssailed in this petition for certiorari is the decision*of the respondent national Labor Relations Commission (NLRC) dated 8 August 1984 which affirmed the decision of respondent Labor Arbiter Luciano P. Aquino with the slight modification of deleting the award of financial assistance to petitioners, and the resolution of the respondent NLRC dated 17 August 1987, denying petitioners' motion for reconsideration.

This petition originated from a complaint for illegal dismissal, underpayment of wages, non-payment of overtime pay, holiday pay, service incentive leave benefits, emergency cost of living allowances and 13th month pay, filed by above-named petitioners against private respondents Aurora L. Cruz, Francisco Borja, Leticia C. Borja and Sto. Nio Realty Incorporated, with Regional Arbitration Branch No. III, National Labor Relations Commission in San Fernando, Pampanga.1Petitioners alleged in their complaint that they were agricultural workers utilized by private respondents in all the agricultural phases of work on the 7 1/2 hectares of ace land and 10 hectares of sugar land owned by the latter; that Fortunato Mercado, Sr. and Leon Santillan worked in the farm of private respondents since 1949, Fortunato Mercado, Jr. and Antonio Mercado since 1972 and the rest of the petitioners since 1960 up to April 1979, when they were all allegedly dismissed from their employment; and that, during the period of their employment, petitioners received the following daily wages:

From 1962-1963 P1.501963-1965 P2.001965-1967 P3.001967-1970 P4.001970-1973 P5.001973-1975 P5.001975-1978 P6.001978-1979 P7.00

Private respondent Aurora Cruz in her answer to petitioners' complaint denied that said petitioners were her regular employees and instead averred that she engaged their services, through Spouses Fortunato Mercado, Sr. and Rosa Mercado, their "mandarols", that is, persons who take charge in supplying the number of workers needed by owners of various farms, but only to do a particular phase of agricultural work necessary in rice production and/or sugar cane production, after which they would be free to render services to other farm owners who need their services.2The other private respondents denied having any relationship whatsoever with the petitioners and state that they were merely registered owners of the land in question included as corespondents in this case.3The dispute in this case revolves around the issue of whether or not petitioners are regular and permanent farm workers and therefore entitled to the benefits which they pray for. And corollary to this, whether or not said petitioners were illegally dismissed by private respondents.

Respondent Labor Arbiter Luciano P. Aquino ruled in favor of private respondents and held that petitioners were not regular and permanent workers of the private respondents, for the nature of the terms and conditions of their hiring reveal that they were required to perform phases of agricultural work for a definite period of time after which their services would be available to any other farm owner.4Respondent Labor Arbiter deemed petitioners' contention of working twelve (12) hours a day the whole year round in the farm, an exaggeration, for the reason that the planting of lice and sugar cane does not entail a whole year as reported in the findings of the Chief of the NLRC Special Task Force.5Even the sworn statement of one of the petitioners, Fortunato Mercado, Jr., the son of spouses Fortunato Mercado, Sr. and Rosa Mercado, indubitably show that said petitioners were hired only as casuals, on an "on and off" basis, thus, it was within the prerogative of private respondent Aurora Cruz either to take in the petitioners to do further work or not after any single phase of agricultural work had been completed by them.6Respondent Labor Arbiter was also of the opinion that the real cause which triggered the filing of the complaint by the petitioners who are related to one another, either by consanguinity or affinity, was the filing of a criminal complaint for theft against Reynaldo Mercado, son of spouses Fortunate Mercado, Sr. and Rosa Mercado, for they even asked the help of Jesus David, Zone Chairman of the locality to talk to private respondent, Aurora Cruz regarding said criminal case.7In his affidavit, Jesus David stated under oath that petitioners were never regularly employed by private respondent Aurora Cruz but were, on-and-off hired to work and render services when needed, thus adding further support to the conclusion that petitioners were not regular and permanent employees of private respondent Aurora Cruz.8Respondent Labor Arbiter further held that only money claims from years 1976-1977, 1977-1978 and 1978-1979 may be properly considered since all the other money claims have prescribed for having accrued beyond the three (3) year period prescribed by law.9On grounds of equity, however, respondent Labor Arbiter awarded petitioners financial assistance by private respondent Aurora Cruz, in the amount of Ten Thousand Pesos (P10,000.00) to be equitably divided among an the petitioners except petitioner Fortunato Mercado, Jr. who had manifested his disinterest in the further prosecution of his complaint against private respondent.10Both parties filed their appeal with the National Labor Relations Commissions (NLRC). Petitioners questioned respondent Labor Arbiter's finding that they were not regular and permanent employees of private respondent Aurora Cruz while private respondents questioned the award of financial assistance granted by respondent Labor Arbiter.

The NLRC ruled in favor of private respondents affirming the decision of the respondent Labor Arbiter, with the modification of the deletion of the award for financial assistance to petitioners. The dispositive portion of the decision of the NLRC reads:

WHEREFORE, the Decision of Labor Arbiter Luciano P. Aquino dated March 3, 1983 is hereby modified in that the award of P10,000.00 financial assistance should be deleted. The said Decision is affirmed in all other aspects.

SO ORDERED.11Petitioners filed a motion for reconsideration of the Decision of the Third Division of the NLRC dated 8 August 1984; however, the NLRC denied tills motion in a resolution dated 17 August 1987.12In the present Petition for certiorari, petitioners seek the reversal of the above-mentioned rulings. Petitioners contend that respondent Labor Arbiter and respondent NLRC erred when both ruled that petitioners are not regular and permanent employees of private respondents based on the terms and conditions of their hiring, for said findings are contrary to the provisions of Article 280 of the Labor Code.13They submit that petitioners' employment, even assuming said employment were seasonal, continued for so many years such that, by express provision of Article 280 of the Labor Code as amended, petitioners have become regular and permanent employees.14Moreover, they argue that Policy Instruction No. 1215of the Department of Labor and Employment clearly lends support to this contention, when it states:

PD 830 has defined the concept of regular and casual employment. What determines regularity or casualness is not the employment contract, written or otherwise, but the nature of the job. If the job is usually necessary or desirable to the main business of the employer, then employment is regular. If not, then the employment is casual. Employment for a definite period which exceeds one (1) year shall be considered re for the duration of the definite period.

This concept of re and casual employment is designed to put an end to casual employment in regular jobs which has been abused by many employers to prevent so-called casuals from enjoying the benefits of regular employees or to prevent casuals from joining unions.

This new concept should be strictly enforced to give meaning to the constitutional guarantee of employment tenure.16Tested under the laws invoked, petitioners submit that it would be unjust, if not unlawful, to consider them as casual workers since they have been doing all phases of agricultural work for so many years, activities which are undeniably necessary, desirable and indispensable in the rice and sugar cane production business of the private respondents.17In the Comment filed by private respondents, they submit that the decision of the Labor Arbiter, as aimed by respondent NLRC, that petitioners were only hired as casuals, is based on solid evidence presented by the parties and also by the Chief of the Special Task Force of the NLRC Regional Office and, therefore, in accordance with the rule on findings of fact of administrative agencies, the decision should be given great weight.18Furthermore, they contend that the arguments used by petitioners in questioning the decision of the Labor Arbiter were based on matters which were not offered as evidence in the case heard before the regional office of the then Ministry of Labor but rather in the case before the Social Security Commission, also between the same parties.19Public respondent NLRC filed a separate comment prepared by the Solicitor General. It submits that it has long been settled that findings of fact of administrative agencies if supported by substantial evidence are entitled to great weight.20Moreover, it argues that petitioners cannot be deemed to be permanent and regular employees since they fall under the exception stated in Article 280 of the Labor Code, which reads:

The provisions of written agreements to the contrary notwithstanding and regardless of the oral agreements of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer,exceptwhere the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee orwhere the work or services to be performed is seasonal in nature and the employment is for the duration of the season.21(emphasis supplied)

The Court resolved to give due course to the petition and required the parties to submit their respective memoranda after which the case was deemed submitted for decision.

The petition is not impressed with merit.

The invariable rule set by the Court in reviewing administrative decisions of the Executive Branch of the Government is that the findings of fact made therein are respected, so long as they are supported by substantial evidence, even if not overwhelming or preponderant;22that it is not for the reviewing court to weigh the conflicting evidence, determine the credibility of the witnesses or otherwise substitute its own judgment for that of the administrative agency on the sufficiency of the evidence;23that the administrative decision in matters within the executive's jurisdiction can only be set aside upon proof of gross abuse of discretion, fraud, or error of law.24The questioned decision of the Labor Arbiter reads:

Focusing the spotlight of judicious scrutiny on the evidence on record and the arguments of both parties, it is our well-discerned opinion that the petitioners are not regular and permanent workers of the respondents. The very nature of the terms and conditions of their hiring reveal that the petitioners were required to perform p of cultural work for a definite period, after which their services are available to any farm owner. We cannot share the arguments of the petitioners that they worked continuously the whole year round for twelve hours a day. This, we feel, is an exaggeration which does not deserve any serious consideration inasmuch as the plan of rice and sugar cane does not entail a whole year operation, the area in question being comparatively small. It is noteworthy that the findings of the Chief of the Special Task Force of the Regional Office are similar to this.

In fact, the sworn statement of one of the petitioners Fortunato Mercado, Jr., the son of spouses Fortunato Mercado, Sr. and Rosa Mercado, indubitably shows that said petitioners were only hired as casuals, on-and-off basis. With this kind of relationship between the petitioners and the respondent Aurora Cruz, we feel that there is no basis in law upon which the claims of the petitioners should be sustained, more specially their complaint for illegal dismissal. It is within the prerogative of respondent Aurora Cruz either to take in the petitioners to do further work or not after any single phase of agricultural work has been completed by them. We are of the opinion that the real cause which triggered the filing of this complaint by the petitioners who are related to one another, either by consanguinity or affinity was due to the filing of a criminal complaint by the respondent Aurora Cruz against Reynaldo Mercado, son of spouses Fortunato Mercado, Sr. and Rosa Mercado. In April 1979, according to Jesus David, Zone Chairman of the locality where the petitioners and respondent reside, petitioner Fortunato Mercado, Sr. asked for help regarding the case of his son, Reynaldo, to talk with respondent Aurora Cruz and the said Zone Chairman also stated under oath that the petitioners were never regularly employed by respondent Aurora Cruz but were on-and-off hired to work to render services when needed.25A careful examination of the foregoing statements reveals that the findings of the Labor Arbiter in the case are ably supported by evidence. There is, therefore, no circumstance that would warrant a reversal of the questioned decision of the Labor Arbiter as affirmed by the National Labor Relations Commission.

The contention of petitioners that the second paragraph of Article 280 of the Labor Code should have been applied in their case presents an opportunity to clarify the afore-mentioned provision of law.

Article 280 of the Labor Code reads in full:

Article 280.Regular and Casual Employment. The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season.

An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That, any employee who has rendered at least one year of service whether such service is continuous or broken, shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such actually exists.

The first paragraph answers the question of who are employees. It states that, regardless of any written or oral agreement to the contrary, an employee is deemed regular where he is engaged in necessary or desirable activities in the usual business or trade of the employer,except for project employees.A project employee has been defined to be one whose employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of the engagement of the employee, or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season26as in the present case.

The second paragraph of Art. 280 demarcates as "casual" employees, all other employees who do not fan under the definition of the preceding paragraph. The proviso, in said second paragraph, deems as regular employees those "casual" employees who have rendered at least one year of service regardless of the fact that such service may be continuous or broken.

Petitioners, in effect, contend that the proviso in the second paragraph of Art. 280 is applicable to their case and that the Labor Arbiter should have considered them regular by virtue of said proviso. The contention is without merit.

The general rule is that the office of a proviso is to qualify or modify only the phrase immediately preceding it or restrain or limit the generality of the clause that it immediately follows.27Thus, it has been held that a proviso is to be construed with reference to the immediately preceding part of the provision to which it is attached, and not to the statute itself or to other sections thereof.28The only exception to this rule is where the clear legislative intent is to restrain or qualify not only the phrase immediately preceding it (the proviso) but also earlier provisions of the statute or even the statute itself as a whole.29Policy Instruction No. 12 of the Department of Labor and Employment discloses that the concept of regular and casual employees was designed to put an end to casual employment in regular jobs, which has been abused by many employers to prevent called casuals from enjoying the benefits of regular employees or to prevent casuals from joining unions. The same instructions show that the proviso in the second paragraph of Art. 280 was not designed to stifle small-scale businesses nor to oppress agricultural land owners to further the interests of laborers, whether agricultural or industrial. What it seeks to eliminate are abuses of employers against their employees and not, as petitioners would have us believe, to prevent small-scale businesses from engaging in legitimate methods to realize profit. Hence, the proviso is applicable only to the employees who are deemed "casuals" but not to the "project" employees nor the regular employees treated in paragraph one of Art. 280.

Clearly, therefore, petitioners being project employees, or, to use the correct term,seasonal employees,their employment legally ends upon completion of the project or the season. The termination of their employment cannot and should not constitute an illegal dismissal.30WHEREFORE, the petition is DISMISSED. The decision of the National Labor Relations Commission affirming that of the Labor Arbiter, under review, is AFFIRMED. No pronouncement as to costs.

SO ORDERED.

INCLUDING (#77)

SECOND DIVISION

[G.R. No. 171427, March 30 : 2011]

STERLING SELECTIONS CORPORATION, PETITIONER, VS. LAGUNA LAKE DEVELOPMENT AUTHORITY (LLDA) AND JOAQUIN G. MENDOZA, IN HIS CAPACITY AS GENERAL MANAGER OF LLDA, RESPONDENTS.

D E C I S I O NNACHURA,J.:Before this Court is a Petition for Review onCertiorariunder Rule 45 of the Rules of Court. Petitioner Sterling Selections Corporation (petitioner) is assailing the Decision[1]dated May 30, 2005 and the Resolution[2]dated January 31, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 79889.

Petitioner is a company engaged in the fabrication of sterling silver jewelry. Its products are manufactured in the home of its principal stockholders, Asuncion Maria and Juan Luis Faustmann (Faustmanns), located in Barangay (Brgy.) Mariana, New Manila, Quezon City.[3]

Sometime in 1992, one of petitioner's neighbors in Brgy. Mariana filed a complaint with the Office of the Chairman of Brgy. Mariana against petitioner for "creating loud unceasing noise and emitting toxic fumes," coming from the manufacturing plant of the latter's predecessor, Unson, Faustmann and Company, Inc.[4]During conciliation proceedings, petitioner's management undertook to relocate its operations within a month. The parties signed an Agreement to that effect.[5]However, petitioner failed to abide by the undertaking and continued to manufacture its products in its Brgy. Mariana workshop.

On January 16, 1998, Alicia P. Maceda (Maceda), another neighbor of petitioner, wrote a letter to the Brgy. Chairman to complain about the loud noise and offensive toxic fumes coming from petitioner's manufacturing plant.[6]She also filed a formal complaint with the Department of Environment and Natural Resources (DENR)-National Capital Region office. The complaint was endorsed by the DENR to one of the agencies under it, respondent Laguna Lake Development Authority (LLDA), which had territorial and functional jurisdiction over the matter.[7]

Subsequently, the Monitoring and Enforcement Section-Pollution Control Division of LLDA conducted an inspection of petitioner's premises. According to the LLDA, it was observed that the wastewater generated by petitioner's operations was drained directly to the sewer canal. However, since the wastewater was not yet for disposal, no sample could be collected during the inspection.

On November 19, 1998, a Notice of Violation and a Cease and Desist Order (CDO) were served on petitioner after it was found that it was operating without an LLDA Clearance and Permit, as required by Republic Act (R.A.) No. 4850.[8]

Meanwhile, Maceda's complaint was endorsed by the LLDA to the Office of the Mayor of Quezon City. After hearing and investigation, the Office of the Mayor issued a Closure Order against petitioner after finding that it was operating without the requisite business permit, since it was running a jewelry manufacturing plant with an "Office Only" permit, and for violation of Zoning and Environmental Laws.[9]

Petitioner then filed a petition formandamusbefore the Regional Trial Court (RTC), Branch 167, Pasig City. Contending that, as acottage industry, its jewelry business is exempt from the requirement to secure a permit from the LLDA, petitioner asked the court to order the latter to issue a certificate of exemption in its favor. The RTC denied the petition, ruling thatmandamusdoes not lie to compel the performance of a discretionary duty. Nonetheless, the RTC allowed petitioner to file an amended petition forcertiorariandmandamus.[10]

In its amended petition, petitioner averred that its business was classified as acottage industry. It argued that under R.A. No. 6977, the law prevailing at the time of its registration with the Securities and Exchange Commission (SEC) in December 1996,cottage industrywas defined as one with assets worth P50,001.00 to P500,000.00.[11]Since, based on its Articles of Incorporation and Certified Public Accountant (CPA)'s Balance Sheet, its total assets when it was incorporated amounted only to P312,500.00, it qualified as acottage industry.

Intervenors Maceda, Ma. Corazon G. Logarta (Logarta), and Rosario "Charito" Planas (Planas) filed a motion for intervention. Their Answer-in-Intervention was subsequently admitted by the RTC.

On April 1, 2002, the RTC promulgated a decision[12]denying the petition. In rejecting petitioner's claim that it was acottage industry, the RTC said:While it is true that plaintiff [petitioner]'s economic activity is carried on in a home, which incidentally gained the ire of the neighbors that culminated in a complaint against the plaintiff, it was manned not with the members of the family but by at least two hundred employees who were strangers and not known to the community. Moreso, being an accredited exporter recognized by the Bureau of Export Trade Promotion, Department of Trade and Industry, seemed a deviation from the connotation of "small scale."

Worthy to note is the observation of respondent-intervenors that to be considered a cottage industry, plaintiff should have been registered under the [National Cottage Industries Development Authority (NACIDA)], Section 12 of R.A. [No.] 3470 substantially provides; (sic) that the plaintiff corporation who desires to avail of the benefits and assistance of the law should have registered with the board. In the absence of any indication that affirm the status of the plaintiff corporation as a cottage industry, proof to the contrary may be reasonably accepted, for he who alleged the affirmative of the issue has the burden of proof and in this aspect plaintiff miserably failed.

On the contention that LLDA Resolution No. 41, series of 1997, exempt the plaintiff corporation from the requirements imposed by the LLDA, the interpretation given by [the] government agency itself should be given greater probative value. As a regulatory and quasi-judicial body, the LLDA is mandated to pass upon, approve or disapprove all plans, programs and project[s] proposed by local government offices/agencies, public corporations and private [corporations]. It is in the position to construe its own rules and regulation. By implication, plaintiff corporation arrogates unto itself the privilege bestowed upon a cottage industry. However, there is nothing in the Resolution that includes jewelry making as included in the term cottage industry.[13]

Thus, the RTC held that petitioner must subscribe to the rules and regulations of the LLDA governing clearance.[14]

Petitioner filed a motion for reconsideration of the RTC decision. The same was denied in an Order dated May 17, 2002. Hence, it filed a Notice of Appeal. Subsequently, it filed its appeal with the CA.

In a Decision[15]dated May 30, 2005, the CA dismissed the appeal. The CA brushed aside the issue of whether petitioner qualified as acottage industry.It said that even if petitioner belonged to that category, it still needed to prove that its business was exempted by law from the coverage of LLDA Resolution No. 41, Series of 1997.

Specifically, the CA cited Section 2(30) of said resolution, to wit:Section 2.Exemptions. The following activities, projects, and installations are exempt from the above subject requirements:x x x x

30. Cottage Industries, including- stuffed toys manufacturing- handicrafts, and- rattan/furniture manufacturing.[16]

The CA held that, following the principle ofejusdem generis, the enumeration in the foregoing provision must be taken to include businesses of the same kind, which were, as averred by the LLDA, not as environmentally critical as those enumerated.[17]Thus, the CA declared that the LLDA did not contemplate the inclusion of the manufacture of jewelry in the exemptions.[18]Additionally, the CA held that the opinions and rulings of officials of the government called upon to execute or implement administrative laws command respect and weight.[19]The CA further held that since petitioner was claiming to be within the exemption, it had the duty to prove that the law intended to include it, or that it is within the contemplation of the law, to be exempted.[20]

Petitioner moved for the reconsideration of the Decision, but the CA denied the same in a Resolution dated January 31, 2006. Hence, petitioner filed this petition for review.

Petitioner argues that the CA committed the following errors:1. The appellate court erred when it failed or refused to make a definitive pronouncement as to whether petitioner qualifies as a cottage industry. This, even after the appellate court (on page 7 of the assailed Decision) scored the trial court for having "failed to consider the fact that the predicament of Sterling rests primarily on the determination of its status," i.e., whether petitioner is a cottage industry or not.2. The appellate court erred when it deliberately ignored the provisions of various statutes and regulations pertaining to cottage industries, which if the same had been taken into account and accorded due consideration, would have led the appellate court to correctly conclude that petitioner is indeed a cottage industry.3. The appellate court erred when it declared, after misapplying the rules of statutory construction, that No. 30 of Sec. 2 of LLDA Resolution No. 41, Series of 1997, does not serve to exempt petitioner from the clearance requirement.[21]

Petitioner also argues that Section 2(30) of LLDA Resolution No. 41, Series of 1997, contains no restriction limiting the exemptions to only certain kinds of cottage industries.[22]It contends that the word "including" connotes a sense of "containing" or "comprising," and not a sense of exclusivity or exclusion. The provision, petitioner points out, is devoid of any restrictive or limiting words; thus, the LLDA should avoid limiting the kinds or classes ofcottage industriesexempted from the clearance requirement.[23]

Next, petitioner avers that the CA erred when it refused to rule on whether it qualified as acottage industry. It claims that the CA deliberately ignored the provisions in various statutes and regulations pertaining tocottage industries, which would have led to the conclusion that petitioner was such, and thus would fall within the exemption.[24]Petitioner argues that its total assets were worth only P312,500.00 during its incorporation, which, under R.A. No. 6977, would qualify it as acottage industry. Further, petitioner argues that, even with the enactment of R.A. No. 8502, theJewelry Industry Development Act of 1998, jewelry-making remains acottage industry.[25]

Finally, petitioner puts in question the factual basis for the issuance of the CDO by the LLDA.

By way of comment, intervenors Maceda, Logarta, and Planas allege that petitioner has been operating illegally, violating ordinances and laws, operating without the required permits and clearances, and continuing its operations despite LLDA's issuance of a CDO.[26]They further allege that petitioner's business is located in an area classified as "R-1" or low density residential zone under Quezon City Ordinance SP-918, Series of 2000, and preceding zoning ordinances. Despite having only an "Office Only" permit, petitioner deliberately uses the premises to manufacture jewelry.[27]

Intervenors also refute petitioner's claim that it is exempted from obtaining the required LLDA clearance because it is acottage industry. First, intervenors allege that petitioner is not registered with the National Cottage Industries Development Authority (NACIDA). Next, intervenors point out that, as admitted by petitioner itself, it employs at least 229 employees who are strangers to the family, and its operations yield annual sales of at least P25 million.[28]

Intervenors also aver that, in R.A. No. 8502, there is no provision categorizing jewelry-making as acottage industry. Going by the classification of jewelry-making companies in the Implementing Rules and Regulations of R.A. No. 8502[29]and petitioner's financial statements filed with the SEC, which state that petitioner had assets amounting to P2,454,459.01 in 1999 and P4,628,900.80 in 1998,[30]it cannot be characterized as a micro jewelry enterprise.

Next, intervenors insist that the LLDA has jurisdiction over petitioner. They argue that LLDA Resolution No. 41, Series of 1997, does not in any manner waive the LLDA jurisdiction even over those exempted in the list of activities, projects, and installations. Jurisdiction is provided for by law and cannot be diminished by an act of the agency concerned. In fact, there is no provision of waiver of jurisdiction contained in the said regulation. Exemption from securing prior clearance before implementing an activity does not carry with it a waiver of jurisdiction.[31]

Intevernors also point out thatcottage industry, as contemplated under LLDA Resolution No. 41, Series of 1997, includes only the activities enumerated therein, namely, stuffed toys manufacturing, handicrafts, and rattan/furniture manufacturing. Further, intervenors aver that, under existing laws, the termcottage industryno longer exists and has been deleted. Jewelry-making is now classified as an independent and separate industry under R.A. No. 8502, apart from the general termcottage industry. Therefore, petitioner's activity cannot be included as among those exempted from obtaining a clearance from the LLDA because jewelry-making is not at all mentioned as an exception to the general rule, intervenors claim.[32]

On the other hand, the LLDA and its former General Manager Joaquin G. Mendoza (respondents) also filed their Comment. Respondents narrated that in 1998, petitioner was found to be operating its business without clearance and permit from the LLDA. Accordingly, a Notice of Violation was issued against petitioner. Subsequently, the LLDA conducted a public hearing, which was attended by petitioner, its company physician, and legal counsels. During the hearing, petitioner committed to relocate its facilities. Meanwhile, the same would remain padlocked to erase all doubts of its continued operation despite the Closure Order from the Quezon City Mayor's Office.[33]After the public hearing, the LLDA issued the assailed CDO against petitioner. Thereafter, proceedings before the RTC, then the CA, ensued, resulting in the now-assailed decision and resolution.

In their Comment, respondents posit that petitioner is not acottage industrywithin the contemplation of the law. They argue that to qualify as such, the conditions in the laws must be complied with. Thus, while metalcraft activities are considered ascottage industry, asset requirements and NACIDA registration requirements must also be complied with.[34]

Respondents contend that petitioner cannot be considered acottage industryconsidering that it has assets way above the threshold fixed in the law. Respondents aver that what petitioner claims as its assets amounting to P312,500.00 refer only to the minimum paid-up capital stock required by law for purposes of incorporation and registration with the SEC. Respondents argue that petitioner would have other properties contributed and owned for purposes of starting the enterprise, such as furniture, fixtures, machinery, and equipment. Likewise, respondents point out that petitioner actually has a capitalization of P5 million, of which P1.25 million had been subscribed. The amount subscribed minus the paid-up capital is a subscription receivable from the incorporators and is an asset.[35]

Next, respondents argue that the CA did not err in ruling that petitioner is not exempted from securing a clearance from the LLDA. The respondents posit that, under LLDA Resolution No. 41, Series of 1997, thecottage industriesexempted are those of the same nature and category as those enumerated therein, following the principle ofejusdem generis.[36]The activities enumerated, respondents claim, are those whose operations are basically dry and whose environmental impact is not so significant.[37]Likewise, respondents argue that, following the principleexpressio unius est exclusio alterius, the express mention of the three activities excluded all othercottage industries. If the LLDA had intended to exempt all types ofcottage industries, it would not have made an enumeration of those exempt activities, respondents posit.[38]

In its Reply, petitioner claims that intervenors are illegally suppressing petitioner's legitimate business because it is competing with the jewelry business of intervenor Logarta's cousin.[39]Petitioner claims that Logarta's cousin also operates his business within the same area as its facilities. It further claims that there is a total of 34 other businesses, including a manufacturer of garments, a wholesaler of cement, and a manufacturer of leather bags, operating in the same supposedly-residential zone where its office is located.[40]Petitioner also accuses intervenors Maceda and Planas of going to court with "unclean hands," considering that they also run businesses in the same area.[41]

Petitioner also denies that Mrs. Faustmann, then operating Unson, Faustmann and Company, Inc., reneged on a promise, made in 1992, to relocate the company's operations. Petitioner claims that Mrs. Faustmann was pressured into signing the Agreement before theLupon, through threats and intimidation. As to the later complaint, petitioner claims that intervenors succeeded in pressing residents to sign the complaint, but those who signed were in fact from other streets, further away from its office.[42]

Petitioner also claims that there was no public hearing conducted before the Quezon City Mayor's Office issued and enforced the CDO.

Petitioner likewise insists that its business qualifies as acottage industry.[43]It maintains that pertinent laws have identified jewelry-making as acottage industry. The Cottage Industry Technology Center (CITC) designates jewelry-making as one of the industries it actively assists. Petitioner also maintains that its paid-up capital qualifies its business as acottage industry.[44]

The petition is unmeritorious; hence, the same is denied.

The main issue to be resolved is whether petitioner is exempted from complying with the requirement to obtain a clearance from the LLDA to operate its business.

Petitioner insists that it is exempted from complying with the clearance requirements because it is acottage industry. In order to resolve this issue, a review of the laws pertinent to cottage industries is in order.

Section 11 of R.A. No. 3470, approved on June 16, 1962, definedcottage industryas an "economic activity in a small scale which is carried on mainly in the homes or in other places for profit and which is mainly done with the help of the members of the family." Among the activities considered as acottage industryis "metalcraft such as making of jewelries, knives, boloes (sic), scissors, razors, silverwares and brassworks (sic)."[45]

The same law required persons, corporations, partnerships, or associations that wished to avail of the benefits of the law to register with the NACIDA.[46]

In 1968, R.A. No. 5326 amended certain sections of R.A. No. 3470. In particular, Section 11 was amended to read:SEC. 11.Definition. - The term `cottage industry' as used in this Act shall mean an economic activity in a small scale carried on mainly in the homes or in other places for profit and mainly done with the help of the members of the family with capitalization not exceeding fifteen thousand pesos. The term shall also include economic activities carried on by students of public and private schools, within school premises, as a cooperative effort, under supervision of a teacher or other person approved by and acting under the supervision and control of school authorities, either as part of or in addition to ordinary vocational training, provided all profits shall accrue to the students working therein. it shall include the following: x x x (5) metal craft such as making of jewelries, knives, boloes (sic), scissors, razors, silverwares and brassworks (sic); x x x All cottage industries shall be owned and operated by Filipino citizens, or by a corporation, partnership or cooperative, at least seventy-five per cent of the capital or investment of which is owned by Filipino citizens. All members of its Board of Directors shall be Filipino citizens.

The word capitalization as used in this section shall mean the total current assets and fixed assets, excluding the value of the land and building leased, rented and/or used at least six months of each year. For purpose of this Act, any and all branches, agencies, outlets or divisions of a licensed cottage industry shall be collated to determine the capitalization thereof.

R.A. No. 3470 was further amended on October 22, 1975, by Presidential Decree (P.D.) No. 817. The first sentence of Section 11 was amended, to read:The term "cottage industry" as used in this Act shall mean an economic activity carried on in the homes or in other places for profit, with a capitalization of not exceeding P100,000 at the time of registration.

In 1981, then President Ferdinand Marcos issued P.D. No. 1788, theCottage Industries Development Decree of 1981, amending and consolidating R.A. Nos. 3470 and 5326, P.D. No. 817, and other related Laws, Decrees, Executive Orders, Letters of Instructions, and Acts concerning the NACIDA. Section 10 of P.D. No. 1788 states:Section 10. Cottage Industry - The term "cottage industry" shall mean a modest economic activity for profit using primarily indigenous raw materials in the production of various articles of the country.Provided, however, that all cottage industries shall be owned and operated by Filipino citizens, or by corporations, partnerships, or cooperatives at least seventy-five percent (75%) of the capital investment of which shall be owned by Filipino citizens.Provided, further, that the total assets of which shall not exceed one hundred thousand pesos (P100,000.00) at the time of registration with the NACIDA. Provided, finally that the maximum total assets allowable for cottage industries for purposes of registration may be modified and/or increased accordingly by the NACIDA Board subject to the approval of the President of the Republic of the Philippines.

For facility of implementation, coordination and statistical gathering, cottage industries shall be classified as follows:x x x x

a)Metalcraft Industry- That sector using metals or its alloys as principal raw material component in producing articles such as brasswares, cutlery items, fabricated tools, implements and equipment and other items requiring a certain degree of craftsmanship in the making thereof including the making of jewelry items involving the use metals and/or its alloys in combination with semiprecious or artificial stones.

Executive Order (E.O.) No. 917, issued on October 15, 1983, amended the definition ofcottage industryby increasing the capitalization requirement to a maximum of P250,000.00, which amount may be modified or increased accordingly, subject to the approval of the President.[47]

In 1986, the National Economic Development Authority (NEDA) redefined cottage, small and medium scale industries. Considered as cottage industries were enterprises, excluding agriculture, with total assets after financing of over P500,000.00 but less than P5 million.[48]

When Corazon Aquino became President, she issued E.O. No. 133, reorganizing the Department of Trade and Industry (DTI). Section 18 thereof provided that the NACIDA was reorganized into the CITC, and its functions, other than technology development and training, were transferred to the Bureau of Small and Medium Business Development and relevant line operating units of the DTI.

In 1990, Congress enacted R.A. No. 6977, theMagna Carta for Small Enterprises. The capitalization for acottage enterprisewas changed,viz.:SEC. 3. Small and Medium Enterprises as Beneficiaries. - "Small and medium enterprise" shall be defined as any business activity or enterprise engaged in industry, agribusiness and/or services, whether single proprietorship, cooperative, partnership or corporation whose total assets, inclusive of those arising from loans but exclusive of the land on which the particular business entity's office, plant, and equipment are situated, must have value falling under the following categories:micro : less than P50,000cottage : P50,001 - P500,000small : P500,001 - P5,000,000medium: P5,000,001 - P20,000,000

In a generic sense, all enterprises with total assets of Five million pesos (P5,000,000) and below shall be called small enterprises.

R.A. No. 6977 was amended by R.A. No. 8289 in 1998. Amending Section 1 of R.A. No. 6977, the termcottage industryorcottage enterprisewas completely eliminated:SEC. 3.Small and Medium Enterprise as Beneficiaries. - "Small and Medium Enterprise" shall be defined as any business activity or enterprise engaged in industry, agribusiness and/or services, whether single proprietorship, cooperative, partnership or corporation whose total assets, inclusive of those arising from loans but exclusive of the land on which the particular business entity's office, plant, and equipment are situated, must have value falling under the following categories:micro : less than P1,500,001small : P1,500,001 - P15,000,000medium: P15,000,001 - P60,000,00The above definitions shall be subject to review and adjustment by the said Councilmotu proprioor upon recommendation of sectoral organization(s) taking into account inflation and other economic indicators. The Council may use as variables the number of employees, equity capital and asset size.

Finally, in 1998, Congress enacted R.A. No. 8502, theJewelry Industry Development Act of 1998, a law to support, promote, and encourage the growth and development of the predominantly small and medium scale jewelry industries. R.A. No. 8502 did not use the termcottage industry; instead, it characterized businesses engaged in jewelry-making as:a) micro jewelry enterprise less than P1,500,001b) small scale jewelry enterprise P1,500,001 - P15,000,000c) medium jewelry enterprise P15,000,001 - P60,000,000d) large scale jewelry enterprise more than P60,000,000.[49]

On the other hand, the LLDA was created by R.A. No. 4850 to carry out the development of the Laguna Lake region with due regard and adequate provisions for environmental management and control, preservation of the quality of human life and ecological systems, and prevention of undue ecological disturbances, deterioration, and pollution.[50]

The LLDA was granted the power to pass upon and approve or disapprove all plans, programs, and projects proposed by the local government offices/agencies within their regions, by public corporations, and by private persons or enterprises, where such plans, programs and/or projects are related to those of the Authority for the development of the region, as well as to issue the necessary clearance for the approved plans, programs and/or projects.[51]

Thus, in LLDA Resolution No. 41, Series of 1997, the LLDA specified the development activities, projects, and installations required to secure a clearance from the LLDA before these can be constructed, operated, maintained, expanded, modified, or implemented by any government office/agency or government corporation or private person or enterprise.[52]Section 2 of the LLDA Resolution then set out the activities exempted from complying with the clearance requirement, to wit:Section 2.Exemptions. The following activities, projects, [or] installations are exempted from the above subject requirements:

x x x x30. Cottage industries including- stuffed toys manufacturing- handicrafts and- rattan/furniture manufacturing.

Contrary to the CA's pronouncement and to respondents' claim, the provision did not restrict the exemption to the three activities therein mentioned.

The wordincludemeans "to take in or compriseas apartof a whole."[53]

Thus, this Court has previously held that it necessarily conveys the very idea of non-exclusivity of the enumeration.[54]The principle ofexpressio unius est exclusio alteriusdoes not apply where other circumstances indicate that the enumeration was not intended to be exclusive, or where the enumeration is by way of example only.[55]The maximexpressio unius est exclusio alteriusdoes not apply when words are mentioned by way of example.[56]Said legal maxim should be applied only as a means of discovering legislative intent which is not otherwise manifest.[57]

In another case, the Court said:[T]he word "involving," when understood in the sense of "including," as in includingtechnical orfinancial assistance, necessarily implies that there are activities other thanthose that are being included. In other words, if an agreementincludestechnical or financial assistance, there is [-] apart from such assistance - something else already in[,] and covered or may be covered by, the said agreement.[58]

As the regulation stands, therefore, allcottage industriesincluding,but not limited to, those enumerated therein are exempted from securing prior clearance from the LLDA. Hence, the CA erred in ruling that only the three activities enumerated therein are exempted.

Next, the Court must determine if petitioner is in fact acottage industryentitled to claim the exemption under LLDA Resolution No. 41, Series of 1997.

That jewelry-making is one of the activities considered as acottage industryis undeniable. The laws bear this out. However, based on these same laws, the nature of the activity isonly oneof several factorsto be considered in determining whether the same is acottage industry.

In view of the emphasis in law after law on the capitalization or asset requirements, it is crystal clear that the same is a defining element in determining if an enterprise is acottage industry.

Petitioner argues that its assets amount to only P312,500.00, representing its paid-up capital at the time of its SEC registration. The law then in force was R.A. No. 6977, which, to recapitulate, states:SEC. 3. Small and Medium Enterprises as Beneficiaries. - "Small and medium enterprise" shall be defined as any business activity or enterprise engaged in industry, agribusiness and/or services, whether single proprietorship, cooperative, partnership or corporationwhose total assets, inclusive of those arising from loans but exclusive of the land on which the particular business entity's office, plant, and equipment are situated,must have value falling under the following categories:micro : less than P50,000cottage: P50,001 - P500,000small : P500,001 - P5,000,000medium: P5,000,001 - P20,000,000

In a generic sense, all enterprises with total assets of Five million pesos (P5,000,000) and below shall be called small enterprises.

Accordingly, it should be considered as acottage industry, petitioner insists.

However, petitioner's contention that its total assets amounts only to P312,500.00 is misleading.

The P312,500.00 represents the total amount of the capital stock already subscribed and paid up by the company's stockholders. It does not, however, represent the totality of its assets, even at the time of its registration. By the expert opinion of petitioner's own consultant, independent CPA Maximiano P. Sorongon, Jr., it does not mean that the paid-up capital is the only source of funds of the corporation for it to support its recurring operational requirements, as well as its increased financial requirements later on, as and when the business grows and expands.[59]

In other words, its paid-up capital is not the only asset of the company. Under R.A. No. 6977, the termtotal assetswas understood to mean "inclusive of those arising from loans but exclusive of the land on which the particular business entity's office, plant, and equipment are situated."

Assetsconsist of property of all kinds, real and personal, tangible and intangible, including,inter alia, for certain purposes, patents and causes of action which belong to any person, including a corporation and the estate of a decedent. It is the entire property of a person, association, corporation, or estate that is applicable or subject to the payment of his, her, or its debts.[60]

Consider these details as found by the Board of Investments and set forth in a Memorandum dated June 8, 1999 addressed to the undersecretary of the DENR, listing the basic information of petitioner as follows:Name : Sterling Selections CorporationAddress : 55-A, 11thSt., New Manila, Quezon CityBusiness Activity : Producer of gift items made of silverChairman & Managing Director: Asuncion Maria S. de FaustmannSEC Registration : A 1996-10845 dated December 2, 1996BOI Accreditation : 98-003 dated August 13, 1998 under R.A. 8502BETP Accreditation : 98-0010 dated July 17, 1998 under R.A. 7844No. of Employees : 189 (Direct Labor; Salaries & Allowances -P16,064,000)Value of Export Sales : P19,732,692.00Total Sales : P37,160,340.00 (based on 1998 ITR)[61]

The same figures are reflected in petitioner's own income statement.[62]Petitioner cannot insist on using merely its paid-up capital as basis to determine its assets. The law speaks oftotal assets. Petitioner's own evidence,i.e., balance sheets prepared by CPAs it commissioned itself, shows that it has assets other than its paid-up capital. According to the Consolidated Balance Sheet presented by petitioner, it had assets amounting to P4,628,900.80 by the end of 1998, and P1,746,328.17 by the end of 1997.[63]Obviously, these amounts are over the maximum prescribed by law for cottage industries.

Thus, the conclusion is that petitioner is not acottage industryand, hence, is not exempted from the requirement to secure an LLDA clearance.

Further militating against petitioner's claim is the RTC's astute observation that being an accredited exporter recognized by the Bureau of Export Trade Promotion (BETP) of the DTI seemed like a deviation from the connotation of "small scale."[64]

The Court notes that, to be accredited by the BETP as an exporter, there are strict standards that the enterprise must meet. Under R.A. No. 7844, theExport Development Act of 1994, an exporter is any person, natural or juridical, licensed to do business in the Philippines, engaged directly or indirectly in the production, manufacture or trade of products or services, which earns at least fifty percent (50%) of its normal operating revenues from the sale of its products or services abroad for foreign currency.[65]

The same law provides for tax incentives to exporters, with the qualification that the incentives shall be granted only upon presentation of their BETP certification of the exporter's eligibility.[66]Qualified exporters applying for BETP certification must present a report of their export revenue/sales for the immediately preceding year.[67]

DTI Administrative Order No. 3, Series of 1995, provides for the mechanisms of accreditation for exportersvis- -visthe tax incentives granted under R.A. No. 7844. UnderProcedure for Accreditation of Exporters, the following schedule of application fees was set forth:Export Value Per Year Application Fee$1M - 5M Max. P1,000.00Above $1M - 5M Max. 2,000.00Above $5M - 10M Max.3,000.00Above $10M - 15M Max. 4,000.00Above $15M 5,000.00[68]

Consequently, an exporter must be able to generate and export enough products, with an export value of $1 million per year, in order to be accredited by the BETP for tax incentives. Petitioner's accreditation shows that it complied with this requirement.

Based on the foregoing, it is clear that petitioner cannot be considered acottage industry. Therefore, it is not exempted from complying with the clearance requirement of the LLDA.

It is a doctrine of long-standing that factual findings of administrative bodies on technical matters within their area of expertise should be accorded not only respect but even finality if they are supported by substantial evidence even if they are not overwhelming or preponderant.[69]Courts will not interfere in matters which are addressed to the sound discretion of the government agency entrusted with regulation of activities c