Lawyereering

FACTS

Petitioner Esso Standard Eastern, Inc.,  then a foreign corporation duly licensed to do business in the Philippines, is engaged in the sale of petroleum products which are identified with its trademark ESSO (which as successor of the defunct Standard Vacuum Oil Co. it registered as a business name with the Bureaus of Commerce and Internal Revenue in April and May, 1962). Private respondent in turn is a domestic corporation then engaged in the manufacture and sale of cigarettes, after it acquired in November 1963 the business, factory and patent rights of its predecessor LaOriental Tobacco Corporation, one of the rights thus acquired having been the use of the trademark ESSO on its cigarettes,

Barely had respondent as such successor started manufacturing cigarettes with the trademark ESSO, when petitioner commenced a case for trademark infringement in the Court of First Instance of Manila. The complaint alleged that the petitioner had been for many years engaged in the sale of petroleum products and its trademark ESSO had acquired a considerable goodwill to such an extent that the buying public had always taken the trademark ESSO as equivalent to high quality petroleum products.

In its answer, respondent admitted that it used the trademark ESSO on its own product of cigarettes, which was not identical to those produced and sold by petitioner and therefore did not in any way infringe on or imitate petitioner’s trademark. Respondent contended that in order that there may be trademark infringement, it is indispensable that the mark must be used by one person in connection or competition with goods of the same kind as the complainant’s.

ISSUE

Whether or not the products are non-competing hence an ESSO trademark can be given to both.

RULING

Yes.

It is undisputed that the goods on which petitioner uses; the trademark ESSO, petroleum products, and the product of respondent, cigarettes, are non-competing. But as to whether trademark infringement exists depends for the most part upon whether or not the goods are so

Related that the public may be, or is actually, deceived and misled that they came from the same maker or manufacturer.

For non-competing goods may be those which, though they are not in actual competition, are so related to each other that it might reasonably be assumed that they originate from one manufacturer. Non-competing goods may also be those which, being entirely unrelated, could not reasonably be assumed to have a common source. In the former case of related goods, confusion of business could arise out of the use of similar marks; in the latter case of non-related goods, it could not. The vast majority of courts today follow the modern theory or concept of “related goods” which the court has likewise adopted and uniformly recognized and applied.

Goods are related when they belong to the same class or have the same descriptive properties; when they possess the same physical attributes or essential characteristics with reference to their form, composition, texture or quality.

In this case, the goods are obviously different from each other—with “absolutely no iota of similitude” as stressed in respondent court’s judgment. They are so foreign to each other as to make it unlikely that purchasers would think that petitioner is the manufacturer of respondent’s goods. The mere fact that one person has adopted and used a trademark on his goods does not prevent the adoption and use of the same trademark by others on unrelated articles of a different kind.

Another factor that shows that the goods involved are noncompetitive and non-related is the appellate court’s finding that they flow through different channels of trade, thus: “The products of each party move along and are disposed through different channels of distribution. The (petitioner’s) products are distributed principally through gasoline service and lubrication stations, automotive shops and hardware stores. On the other hand, the (respondent’s) cigarettes are sold in sari-sari stores, grocery stores, and other small distributor outlets.

FACTS

Petitioner Societe Des Produits Nestle, S.A. (Nestle) is a foreign corporation organized under the laws of Switzerland.   It manufactures food products and beverages. Nestle owns the “NAN” trademark for its line of infant powdered milk products, consisting of PRE-NAN, NAN-H.A., NAN-1, and NAN-2.

Dy, Jr. owns 5M Enterprises. He imports Sunny Boy powdered milk from Australia and repacks the powdered milk into three sizes of plastic packs bearing the name “NANNY.”  

In a letter dated 1 August 1985, Nestle requested Dy, Jr. to refrain from using “NANNY” and to undertake that he would stop infringing the “NAN” trademark.   Dy, Jr. did not act on Nestle’s request.

ISSUE

Whether or Not Martin Dy infringes the trademark of Nestle.

RULING

Yes.

The element of likelihood of confusion is the gravamen of trademark infringement. There are two types of confusion in trademark infringement: confusion of goods and confusion of business.

There are two tests to determine likelihood of confusion: the dominance test and holistic test. The dominancy test focuses on the similarity of the main, prevalent or essential features of the competing trademarks that might cause confusion.

The holistic test considers the entirety of the marks, including labels and packaging, in determining confusing similarity. The focus is not only on the predominant words but also on the other features appearing on the labels.

Applying the dominancy test in the present case, the Court finds that “NANNY” is confusingly similar to “NAN.” “NAN” is the prevalent feature of Nestle’s line of infant powdered milk products. It is written in bold letters and used in all products. The line consists of PRE-NAN, NAN-H.A., NAN-1, and NAN-2. Clearly, “NANNY” contains the prevalent feature “NAN.” The first three letters of “NANNY” are exactly the same as the letters of “NAN.” When “NAN” and “NANNY” are pronounced, the aural effect is confusingly similar.

G.R. No. L-4175, June 18, 1976

Facts

On March 31, 1975 Fortunata Barcena, mother of minors Rosalio Bonilla and Salvacion Bonilla and wife of Ponciano Bonilla, instituted a civil action in the Court of First Instance of Abra, to quiet title over certain parcels of land located in Abra.

On August 4, 1975, the defendants filed another motion to dismiss the complaint on the ground that Fortunata Barcena is dead and, therefore, has no legal capacity to sue. Said motion to dismiss was heard on August 14, 1975. In a hearing, counsel for the plaintiff confirmed the death of Fortunata Barcena and asked for substitution by her minor children and her husband, the petitioners herein; but the court after the hearing immediately dismissed the case on the ground that a dead person cannot be a real party in interest and has no legal personality to sue.

The records of this case show that the death of Fortunata Barcena took place on July 9, 1975 while the complaint was filed on March 31, 1975. This means that when the complaint was filed on March 31, 1975, Fortunata Barcena was still alive, and therefore, the court had acquired jurisdiction over her person.

Issue

Whether or not the rights to succession were transmitted to the heirs of Fortunata Barcena and become real party in interest to the case.

Ruling

Yes. Article 777 of the Civil Code provides “that the rights to the succession are transmitted from the moment of the death of the decedent.” From the moment of the death of the decedent, the heirs become the absolute owners of his property, subject to the rights and obligations of the decedent, and they cannot be deprived of their rights thereto except by the methods provided for by law. The moment of death is the determining factor when the heirs acquire a definite right to the inheritance whether such right be pure or contingent. The right of the heirs to the property of the deceased vests in them even before judicial declarations of their being heirs in the testate or intestate proceedings.

When Fortunata Barcena, therefore, died her claim or right to the parcels of land in litigation in Civil Case No. 856, was not extinguished by her death but was transmitted to her heirs upon her death. Her heirs have thus acquired interest in the properties in litigation and became parties in interest in the case.

G.R. No. 192123   March 10, 2014

FACTS

An appeal before the SC was taken by a physician anesthesiologist who has been pronounced guilty of reckless imprudence resulting in serious physical injuries by the Regional Trial Court (RTC) and the Court of Appeals (CA). He had been part of the team of anesthesiologists during the surgical pull-through operation conducted on a three-year old patient born with an imperforate anus.

The SC overturned the lower court’s decision and finding that the lower court did not prove beyond reasonable doubt that Dr. Solidum had been recklessly imprudent in administering the anesthetic agent to Gerald.

ISSUE

Whether or not the acquittal of Dr. Solidum would immediately exempt him from civil liability.

RULING

No. The acquittal would not exempt him from civil liability.

The Court clarified “that the acquittal of Dr. Solidum would not immediately exempt him from civil liability. But we cannot now find and declare him civilly liable because the circumstances that have been established here do not present the factual and legal bases for validly doing so. His acquittal did not derive only from reasonable doubt. There was really no firm and competent showing how the injury to Gerard had been caused. That meant that the manner of administration of the anesthesia by Dr. Solidum was not necessarily the cause of the hypoxia that caused the bradycardia experienced by Gerard. Consequently, to adjudge Dr. Solidum civilly liable would be to speculate on the cause of the hypoxia. We are not allowed to do so, for civil liability must not rest on speculation but on competent evidence.

G.R. No. 168539   March 25, 2014

FACTS

An information was filed against Henry Go for alleged violation of entering into a contract which is grossly and manifestly disadvantageous to the government and for having supposedly conspired with then DOTC Secretary Arturo Enrile.

Henry Go filed a Motion to Quash the Information filed against him on the ground that the operative facts adduced therein do not constitute an offense under Section 3(g) of R.A. 3019. Respondent, citing the show cause order of the SB, also contended that, independently of the deceased Secretary Enrile, the public officer with whom he was alleged to have conspired, respondent, who is not a public officer nor was capacitated by any official authority as a government agent, may not be prosecuted for violation of Section 3(g) of R.A. 3019

ISSUE

WON  the Sandiganbayan has jurisdiction over a private person who was alleged to have conspired with a public official whose salary grade is 27 and that public official has died prior to the filing of the information.

RULING

The SB is a special criminal court which has exclusive original jurisdiction in all cases involving violations of R.A. 3019 committed by certain public officers, as enumerated in P.D. 1606 as amended by R.A. 8249. This includes private individuals who are charged as co-principals, accomplices or accessories with the said public officers. In the instant case, respondent is being charged for violation of Section 3(g) of R.A. 3019, in conspiracy with then Secretary Enrile. Ideally, under the law, both respondent and Secretary Enrile should have been charged before and tried jointly by the Sandiganbayan. However, by reason of the death of the latter, this can no longer be done. Nonetheless, for reasons already discussed, it does not follow that the SB is already divested of its jurisdiction over the person of its jurisdiction over the person of and the case involving herein respondent.

G.R. No. 12644   February 5, 2004

FACTS

The Petitioner, Police Inspector  Arnel Escobal, with salary grade 23, was charged with murder when he got involved in a shooting incident, resulting in the death of Rodney Nueca.

The petitioner was arrested by virtue of a warrant issued by the RTC. The RTC ordered conformably to R.A. No. 7975, to thereafter transmit Re-Amended Information, as well as the complete records with the stenographic notes, to the Sandiganbayan.

Presiding Justice of the Sandiganbayan ordered to return the records of Criminal Case No. 90-3184 to the court of origin, RTC of Naga City, Branch 21. It reasoned that under P.D. No. 1606, as amended by R.A. No. 7975,18 the RTC retained jurisdiction over the case, considering that the petitioner had a salary grade of “23.”

ISSUE

WON the Sandiganbayan has jurisdiction over a police officer whose salary grade is 23 and the offense happened in performance of his duties.

RULING

Yes.

Under the law, even if the offender committed the crime charged in relation to his office but occupies a position corresponding to a salary grade below “27,” the proper Regional Trial Court or Municipal Trial Court, as the case may be, shall have exclusive jurisdiction over the case. In this case, the petitioner was a Police Senior Inspector, with salary grade “23.” He was charged with homicide punishable by reclusion temporal. Hence, the RTC had exclusive jurisdiction over the crime charged conformably to Sections 20 and 32 of Batas Pambansa Blg. 129, as amended by Section 2 of R.A. No. 7691.

G.R. No. 170122   Octover 12, 2009

FACTS

To recover unlawfully acquired funds and properties in the aggregate amount of PhP 143,052,015.29 that retired Maj. Gen. Carlos F. Garcia, his wife, herein petitioner Clarita, children Ian Carl, Juan Paulo and Timothy Mark (collectively, the Garcias) had allegedly amassed and acquired, the Republic, through the Office of the Ombudsman (OMB), pursuant to Republic Act No. (RA) 1379,3 filed with the Sandiganbayan (SB) on October 29, 2004 a petition for the forfeiture of those properties.

ISSUE

Whether or not, the Sandiganbayan has jurisdiction over separate forfeiture cases.

RULING

Yes. Sandiganbayan has jurisdiction.

As correctly ruled by the SB 4th Division in its May 20, 2005 Resolution,13 the civil liability for forfeiture cases does not arise from the commission of a criminal offense, thus:

Such liability is based on a statute that safeguards the right of the State to recover unlawfully acquired properties. The action of forfeiture arises when a “public officer or employee [acquires] during his incumbency an amount of property which is manifestly out of proportion of his salary x x x and to his other lawful income x x x.” Such amount of property is then presumed prima facie to have been unlawfully acquired. Thus “if the respondent [public official] is unable to show to the satisfaction of the court that he has lawfully acquired the property in question, then the court shall declare such property forfeited in favor of the State, and by virtue of such judgment the property aforesaid shall become property of the State.

G.R. No. 162059      Jan. 22, 2008

FACTS

Petitioner Hannah Eunice D. Serana was a senior student of the University of the Philippines-Cebu. She was appointed by then President Joseph Estrada a student regent of UP.

Serana discussed with President Estrada the renovation of Vinzons Hall Annex in UP Diliman.

President Estrada gave Fifteen Million Pesos (P15,000,000.00) to the OSRFI as financial assistance for the proposed renovation of Vinzons Hall Annex. The source of the funds, according to the information, was the Office of the President.

 The renovation of Vinzons Hall Annex failed to materialize. The succeeding student regent, consequently filed a complaint for Malversation of Public Funds and Property with the Office of the Ombudsman.

The Ombudsman, after due investigation, found probable cause to indict petitioner and her brother Jade Ian D. Serana for estafa, docketed as Criminal Case No. 27819 of the Sandiganbayan

ISSUE

Whether Sandiganbayan has jurisdiction over the offense of Estafa.

RULING

Yes. Sandiganbayan has jurisdiction.

Evidently, the Sandiganbayan has jurisdiction over other felonies committed by public officials in relation to their office. We see no plausible or sensible reason to exclude estafa as one of the offenses included in Section 4(bB) of P.D. No. 1606. Plainly, estafa is one of those other felonies. The jurisdiction is simply subject to the twin requirements that (a) the offense is committed by public officials and employees mentioned in Section 4(A) of P.D. No. 1606, as amended, and that (b) the offense is committed in relation to their office.

Facts

On various dates, Security Bank and Trust Company issued certificates of time deposit (CTDs) in favor of one Angel dela Cruz who deposited with herein defendant.

This is to Certify that B E A R E R has deposited in this Bank the sum of PESOS: FOUR THOUSAND ONLY, SECURITY BANK SUCAT OFFICE P4,000 & 00 CTS Pesos, Philippine Currency, repayable to said depositor 731 days. after date, upon presentation and surrender of this certificate, with interest at the rate of 16% per cent per annum.

Angel dela Cruz delivered the said certificates of time (CTDs) to Caltex in connection with his purchased of fuel products from the latter. Angel dela Cruz told the bank manager that he lost all the certificates of time deposit in dispute and he was told to deliver an Affidavit of Loss in order to replace the CTDs wherein he complied with.

Mr. Aranas, Credit Manager of plaintiff Caltex (Phils.) Inc., went to the defendant bank’s Sucat branch and presented for verification the CTDs declared lost by Angel dela Cruz alleging that the same were delivered to herein plaintiff “as security for purchases made with Caltex Philippines, Inc.” by said depositor.

Issue

Whether or not the CTDs as worded are negotiable instruments.

Ruling

Contrary to what respondent court held, the CTDs are negotiable instruments. The documents provide that the amounts deposited shall be repayable to the depositor. And who, according to the document, is the depositor? It is the “bearer.” The documents do not say that the depositor is Angel de la Cruz and that the amounts deposited are repayable specifically to him. Rather, the amounts are to be repayable to the bearer of the documents or, for that matter, whosoever may be the bearer at the time of presentment.

FACTS:

On February 24, 2006, President Arroyo issued PP No. 1017 declaring a state of emergency, thus:

NOW, THEREFORE, I, Gloria Macapagal-Arroyo, President of the Republic of the Philippines and Commander-in-Chief of the Armed Forces of the Philippines, [calling-out power] by virtue of the powers vested upon me by Section 18, Article 7 of the Philippine Constitution which states that: “The President. . . whenever it becomes necessary, . . . may call out (the) armed forces to prevent or suppress. . .rebellion. . .,” and in my capacity as their Commander-in-Chief, do hereby command the Armed Forces of the Philippines, to maintain law and order throughout the Philippines, prevent or suppress all forms of lawless violence as well as any act of insurrection or rebellion [“take care” power] and to enforce obedience to all the laws and to all decrees, orders and regulations promulgated by me personally or upon my direction; and [power to take over] as provided in Section 17, Article 12 of the Constitution do hereby declare a State of National Emergency.

On the same day, PGMA issued G.O. No. 5 implementing PP1017, directing the members of the AFP and PNP “to immediately carry out the necessary and appropriate actions and measures to suppress and prevent acts of terrorism and lawless violence.”

David, et al. assailed PP 1017 on the grounds that (1) it encroaches on the emergency powers of Congress; (2) it is a subterfuge to avoid the constitutional requirements for the imposition of martial law; and (3) it violates the constitutional guarantees of freedom of the press, of speech and of assembly. They alleged “direct injury” resulting from “illegal arrest” and “unlawful search” committed by police operatives  pursuant to PP 1017.

During the hearing, the Solicitor General argued that the issuance of PP 1017 and GO 5 have factual basis, and contended that the intent of the Constitution is to give full discretionary powers to the President in determining the necessity of calling out the armed forces. The petitioners did not contend the facts stated b the Solicitor General.

ISSUE:

Whether or not the PP 1017  and G.O. No. 5 is constitutional.

RULING:

The operative portion of PP 1017 may be divided into three important provisions, thus:

First provision: “by virtue of the power vested upon me by Section 18, Artilce VII … do hereby command the Armed Forces of the Philippines, to maintain law and order throughout the Philippines, prevent or suppress all forms of lawless violence as well any act of insurrection or rebellion”

Second provision:   “and to enforce obedience to all the laws  and  to  all decrees, orders and regulations promulgated by me personally or upon my direction;”

Third provision: “as provided in Section 17, Article XII of the Constitution do hereby declare a State of National Emergency.”

PP 1017 is partially constitutional insofar as provided by the first provision of the decree.

First Provision: Calling Out Power.

The only criterion for the exercise of the calling-out power is that “whenever it becomes necessary,” the President may call the armed forces “to prevent or suppress lawless violence, invasion or rebellion.” (Integrated Bar of the Philippines v. Zamora)

President Arroyo’s declaration of a “state of rebellion” was merely an act declaring a status or condition of public moment or interest, a declaration allowed under Section 4, Chap 2, Bk II of the Revised Administration Code. Such declaration, in the words of Sanlakas, is harmless, without legal significance, and deemed not written.  In these cases, PP 1017 is more than that.  In declaring a state of national emergency, President Arroyo did not only rely on Section 18, Article VII of the Constitution, a provision calling on the AFP to prevent or suppress lawless violence, invasion or rebellion.  She also relied on Section 17, Article XII, a provision on the State’s extraordinary power to take over privately-owned public utility and business affected with public interest.   Indeed, PP 1017 calls for the exercise of an awesome power.  Obviously, such Proclamation cannot be deemed harmless.

To clarify, PP 1017 is not a declaration of Martial Law.  It is merely an exercise of President Arroyo’s calling-out power for the armed forces to assist her in preventing or suppressing lawless violence.

Second Provision: The “Take Care” Power.

The second provision pertains to the power of the President to ensure that the laws be faithfully executed.  This is based on Section 17, Article VII which reads:

SEC. 17. The President shall have control of all the executive departments, bureaus, and offices. He shall ensure that the laws be faithfully executed.

This Court rules that the assailed PP 1017 is unconstitutional insofar as it grants President Arroyo the authority to promulgate “decrees.”  Legislative power is peculiarly within the province of the Legislature.  Section 1, Article VI categorically states that “[t]he legislative power shall be vested in the Congress of the Philippines which shall consist of a Senate and a House of Representatives.”  To be sure, neither Martial Law nor a state of rebellion nor a state of emergency can justify President Arroyo’s exercise of legislative power by issuing decrees.

Third Provision: The Power to Take Over

 Distinction must be drawn between the President’s authority to declare “a state of national emergency” and to exercise emergency powers.  To the first, Section 18, Article VII grants the President such power, hence, no legitimate constitutional objection can be raised.  But to the second, manifold constitutional issues arise.

Generally, Congress is the repository of emergency powers.  This is evident in the tenor of Section 23 (2), Article VI authorizing it to delegate such powers to the President.  Certainly, a body cannot delegate a power not reposed upon it.  However, knowing that during grave emergencies, it may not be possible or practicable for Congress to meet and exercise its powers, the Framers of our Constitution deemed it wise to allow Congress to grant emergency powers to the President, subject to certain conditions, thus:

(1)   There must be a war or other emergency.

(2)   The delegation must be for a limited period only.

(3)  The delegation must be subject to such restrictions as the Congress may prescribe.

(4)  The emergency powers must be exercised to carry out a national policy declared by Congress.

         Section 17, Article XII must be understood as an aspect of the emergency powers clause.  The taking over of private business affected with public interest is just another facet of the emergency powers generally reposed upon Congress.  Thus, when Section 17 states that the “the State may, during the emergency and under reasonable terms prescribed by it, temporarily take over or direct the operation of any privately owned public utility or business affected with public interest,”  it refers to Congress, not the President.  Now, whether or not the President may exercise such power is dependent on whether Congress may delegate it to him pursuant to a law prescribing the reasonable terms thereof.

Following our interpretation of Section 17, Article XII, invoked by President Arroyo in issuing PP 1017, this Court rules that such Proclamation does not authorize her during the emergency to temporarily take over or direct the operation of any privately owned public utility or business affected with public interest without authority from Congress.

Let it be emphasized that while the President alone can declare a   state of national emergency, however, without legislation, he has no power to take over privately-owned public utility or business affected with public interest. Nor can he determine when such exceptional circumstances have ceased.  Likewise, without legislation, the President has no power to point out the types of businesses affected with public interest that should be taken over.   In short, the President has no absolute authority to exercise all the powers of the State under Section 17, Article VII in the absence of an emergency powers act passed by Congress.

As of G.O. No. 5, it is constitutional since it provides a standard by which the AFP and the PNP should implement PP 1017, i.e. whatever is “necessary and appropriate actions and measures to suppress and prevent acts of lawless violence.”  Considering that “acts of terrorism” have not yet been defined and made punishable by the Legislature, such portion of G.O. No. 5 is declared unconstitutional.