THIRD DIVISION
G.R. No. 126232. November 27, 1998
THE PROVINCE OF BULACAN, ROBERTO M. PAGDANGANAN,
FLORENCE CHAVEZ, and MANUEL DJ SIAYNGCO in their
capacity as PROVINCIAL GOVERNOR, PROVINCIAL
TREASURER, PROVINCIAL LEGAL ADVISE,
respectively, Petitioners, v. THE HONORABLE COURT OF
APPEALS (FORMER SPECIAL 12TH DIVISION), PUBLIC
CEMENT CORPORATION, Respondents.
DECISION
ROMERO, J.:
Before us is a petition for certiorari seeking the reversal of the
decision of the Court of Appeals dated September 27, 1995
declaring petitioner without authority to levy taxes on stones, sand,
gravel, earth and other quarry resources extracted from private
lands, as well as the August 26, 1996 resolution of the appellate
court denying its motion for reconsideration.
The facts are as follows:
On June 26, 1992, the Sangguniang Panlalawigan of Bulacan passed
Provincial Ordinance No. 3, known as "An ordinance Enacting the
Revenue Code of the Bulacan Province," which was to take effect on
July 1, 1992, section 21 of the ordinance provides as follows:
Section 21. Imposition of Tax. There is hereby levied and collected a
tax of 10% of the fair market value in the locality per cubic meter of
ordinary stones, sand, gravel, earth and other quarry resources,
such, but not limited to marble, granite, volcanic cinders, basalt,
tuff and rock phosphate, extracted from public lands or from beds of
seas, lakes, rivers, streams, creeks and other public waters within
its territorial jurisdiction. (Italics ours)
Pursuant thereto, the Provincial Treasurer of Bulacan, in a letter
dated November 11, 1993, assessed private respondent Republic
Cement Corporation (hereafter Republic Cement) P2,524,692.13 for
extracting limestone, shale and silica from several parcels of private
land in the province during the third quarter of 1992 until the
second quarter of 1993. Believing that the province, on the basis of
above-said ordinance, had no authority to impose taxes on quarry
resources extracted from private lands, Republic Cement formally
contested the same on December 23, 1993. The same was,
however, denied by the Provincial Treasurer on January 17, 1994.
Republic Cement, consequently filed a petition for declaratory relief
with the Regional Trial Court of Bulacan on February 14, 1994. The
province filed a motion to dismiss Republic Cement's petition, which
was granted by the trial court on May 13, 1993, which ruled that
declaratory relief was improper, allegedly because a breach of the
ordinance had been committed by Republic Cement.
On July 11, 1994, Republic Cement filed a petition for certiorari with
the Supreme Court seeking to reverse the trial court's dismissal of
their petition. The Court, in a resolution dated July 27, 1994,
referred the same to the Court of Appeals, where it was docketed as
CA G.R. SP No. 34915. The appellate court required petitioners to
file a comment, which they did on September 7, 1994.
In the interim, the Province of Bulacan issued a warrant of levy
against Republic Cement, allegedly because of its unpaid tax
liabilities. Negotiations between Republic Cement and petitioners
resulted in an agreement and modus vivendi on December 12,
1994, whereby Republic Cement agreed to pay under
protest P1,262,346.00, 50% of the tax assessed by petitioner, in
exchange for the lifting of the warrant of levy. Furthermore,
Republic Cement and petitioners agreed to limit the issue for
resolution by the Court of Appeals to the question as to whether or
not the provincial government could impose and/or assess taxes on
quarry resources extracted by Republic Cement from private lands
pursuant to Section 21 of the Provincial Ordinance No. 3. This
agreement and modus vivendi were embodied in a joint
manifestation and motion signed by Governor Roberto
Pagdanganan, on behalf of the Province of Bulacan, by Provincial
Treasurer Florence Chavez, and by Provincial Legal Officer Manuel
Siayngco, as petitioner's counsel and filed with the Court of Appeals
on December 13, 1994. In a resolution dated December 29, 1994,
the appellate court approved the same and limited the issue to be
resolved to the question whether or not the provincial government
could impose taxes on stones, sand, gravel, earth and other quarry
resources extracted from private lands.
After due trial, the Court of Appeals, on September 27, 1995,
rendered the following judgment:
WHEREFORE, judgment is hereby rendered declaring the
Province of Bulacan under its Provincial Ordinance No. 3
entitled "An Ordinance Enacting the Revenue Code of Bulacan
Province" to be without legal authority to impose and assess
taxes on quarry resources extracted by RCC from private
lands, hence the interpretation of Respondent Treasurer of
Chapter II, Article D, Section 21 of the Ordinance, and the
assessment made by the Province of Bulacan against RCC is
null and void.
Petitioner's motion for reconsideration, as well as their supplemental
motion for reconsideration, was denied by the appellate court on
august 26, 1996, hence this appeal.
Petitioner's claim that the Court of Appeals erred in:
1. NOT HAVING OUTRIGHTLY DISMISSED THE SUBJECT
PETITION ON THE GROUND THAT THE SAME IS NOT
THE APPROPRIATE REMEDY FROM THE TRIAL
COURT'S GRANT OF THE PRIVATE RESPONDENTS'
(HEREIN PETITIONER) MOTION TO DISMISS;
2. NOT DISMISSING THE SUBJECT PETITION FOR BEING
VIOLATIVE OF CIRCULAR 2-90 ISSUED BY THE
SUPREME COURT;
3. NOT DISMISSING THE PETITION FOR REVIEW ON THE
GROUND THAT THE TRIAL COURT'S ORDER OF MAY
13, 1994 HAD LONG BECOME FINAL AND
EXECUTORY;
4. GOING BEYOND THE PARAMETERS OF ITS APPELLATE
JURISDICTION IN RENDERING THE SEPTEMBER 27,
1995 DECISION;
5. HOLDING THAT PRIVATE RESPONDENT (HEREIN
PETITIONER) ARE ESTOPPED FROM RAISING THE
PROCEDURAL ISSUE IN THE MOTION FOR
RECONSIDERATION;
6. THE INTERPRETATION OF SECTION 134 OF THE LOCAL
GOVERNMENT CODE AS STATED IN THE SECOND TO
THE LAST PARAGRAPH OF PAGE 5 OF ITS SEPTEMBER
27, 1995 DECISION;
7. SUSTAINING THE ALLEGATIONS OF HEREIN
RESPONDENT WHICH UNJUSTLY DEPRIVED
PETITIONER THE POWER TO CREATE ITS OWN
SOURCES OF REVENUE;
8. DECLARING THAT THE ASSESSMENT MADE BY THE
PROVINCE OF BULACAN AGAINST RCC AS NULL AND
VOID WHICH IN EFFECT IS A COLLATERAL ATTACK
ON PROVINCIAL ORDINANCE NO. 3; AND
9. FAILING TO CONSIDER THE REGALIAN DOCTRINE IN
FAVOR OF THE LOCAL GOVERNMENT.
The issues raised by petitioners are devoid of merit. The number
and diversity of errors raised by appellants impel us, however, to
discuss the points raised seriatim.
In their first assignment of error, petitioners contend that instead of
filing a petition for certiorari with the Supreme Court, Republic
Cement should have appealed from the order of the trial court
dismissing their petition. Citing Martinez vs. CA,1 they allege that a
motion to dismiss is a final order, the remedy against which is not a
petition for certiorari, but an appeal, regardless of the questions
sought to be raised on appeal, whether of fact or of law, whether
involving jurisdiction or grave abuse of discretion of the trial court.
Petitioners' argument is misleading. While it is true that the remedy
against a final order is an appeal, and not a petition for certiorari,
the petition referred to is a petition for certiorari under Rule 65. As
stated in Martinez, the party aggrieved does not have the option to
substitute the special civil action for certiorari under Rule 65 for the
remedy of appeal. The existence and availability of the right of
appeal are antithetical to the availment of the special civil action
for certiorari.
Republic Cement did not, however, file a petition for certiorari under
Rule 65, but an appeal by certiorari under Rule 45. Even law
students know that certiorari under Rule 45 is a mode of appeal, an
appeal from the Regional Trial Court being taken in either of two
ways (a) by writ of error (involving questions of fact and law) and
(b) by certiorari (limited only to issues of law), with an appeal
by certiorari being brought to the Supreme Court, there being no
provision of law for taking appeals by certiorari to the Court of
Appeals.2 It is thus clearly apparent that Republic Cement correctly
contested the trial court's order of dismissal by filing an appeal
by certiorari under Rule 45. In fact, petitioners, in their second
assignment of error, admit that a petition for review
on certiorari under Rule 45 is available to a party aggrieved by an
order granting a motion to dismiss.3 They claim, however, that
Republic Cement could not avail of the same allegedly because the
latter raised issues of fact, which is prohibited, Rule 45 providing
that "(t)he petition shall raise only questions of law which must be
distinctly set forth."4 In this respect, petitioners claim that Republic
Cement's petition should have been dismissed by the appellate
court, Circular 2-90 providing:
4. Erroneous Appeals. - An appeal taken to either the
Supreme Court or the Court of Appeals by the wrong or
inappropriate mode shall be dismissed.
xxx
d) No transfer of appeals erroneously taken. -- No transfers
of appeals erroneously taken to the Supreme Court or to the
Court of Appeals to whichever of these Tribunals has
appropriate appellate jurisdiction will be allowed; continued
ignorance or wilful disregard of the law on appeals will not be
tolerated.
Petitioners even fault the Court for referring Republic Cement's
petition to the Court of Appeals, claiming that the same should have
been dismissed pursuant to Circular 2-90. Petitioners conveniently
overlook the other provisions of Circular 2-90, specifically 4b)
thereof, which provides:
b) Raising factual issues in appeal by certiorari. - Although
submission of issues of fact in an appeal by certiorari taken
to the Supreme Court from the regional trial court is
ordinarily proscribed, the Supreme Court nonetheless retains
the option, in the exercise of its sound discretion and
considering the attendant circumstances, either itself to take
cognizance of and decide such issues or to refer them to the
Court of Appeals for determination.
As can be clearly adduced from the foregoing, when an appeal
by certiorari under Rule 45 erroneously raises factual issues, the
Court has the option to refer the petition to the Court of Appeals.
The exercise by the Court of this option may not now be questioned
by petitioners.
As the trial court's order was properly appealed by Republic
Cement, the trial court's May 13, 1994 order never became final
and executory, rendering petitioner's third assignment of error moot
and academic.
Petitioners' fourth and fifth assignment of errors are likewise
without merit. Petitioners assert that the Court of Appeals could
only rule on the propriety of the trial court's dismissal of Republic
Cement's petition for declaratory relief, allegedly because that was
the sole relief sought by the latter in its petition for certiorari.
Petitioners claim that the appellate court overstepped its jurisdiction
when it declared null and void the assessment made by the Province
of Bulacan against Republic Cement.
Petitioners gloss over the fact that, during the proceedings before
the Court of Appeals, they entered into an agreement and modus
vivendi whereby they limited the issue for resolution to the question
as to whether or not the provincial government could impose and/or
assess taxes on stones, sand, gravel, earth and other quarry
resources extracted by Republic Cement from private lands. This
agreement and modus vivendi were approved by the appellate court
on December 29, 1994. All throughout the proceedings, petitioners
never questioned the authority of the Court of Appeals to decide this
issue, an issue which it brought itself within the purview of the
appellate court. Only when an adverse decision was rendered by the
Court of Appeals did petitioners question the jurisdiction of the
former.
Petitioners are barred by the doctrine of estoppel from contesting
the authority of the Court of Appeals to decide the instant case, as
this Court has consistently held that "(a) party cannot invoke the
jurisdiction of a court to secure affirmative relief against his
opponent and after obtaining or failing to obtain such relief,
repudiate or question that same jurisdiction."5 The Supreme Court
frowns upon the undesirable practice of a party submitting his case
for decision and then accepting the judgment, only if favorable, and
attacking it for lack of jurisdiction when adverse.6
cräläwvirtualibräry
In a desperate attempt to ward off defeat, petitioners now repudiate
the above-mentioned agreement and modus vivendi, claiming that
the same was not binding in the Province of Bulacan, not having
been authorized by the Sangguniang Panlalawigan of Bulacan. While
it is true that the Provincial Governor can enter into contract and
obligate the province only upon authority of the sangguniang
panlalawigan,7 the same is inapplicable to the case at bar. The
agreement and modus vivendi may have been signed by petitioner
Roberto Pagdanganan, as Governor of the Province of Bulacan,
without authorization from the sangguniang panlalawigan, but it
was also signed by Manuel Siayngco, the Provincial Legal Officer, in
his capacity as such, and as counsel of petitioners.
It is a well-settled rule that all proceedings in court to enforce a
remedy, to bring a claim, demand, cause of action or subject matter
of a suit to hearing, trial, determination, judgment and execution
are within the exclusive control of the attorney.8 With respect to
such matters of ordinary judicial procedure, the attorney needs no
special authority to bind his client.9 Such questions as what action
or pleading to file, where and when to file it, what are its formal
requirements, what should be the theory of the case, what defenses
to raise, how may the claim or defense be proved, when to rest the
case, as well as those affecting the competency of a witness, the
sufficiency, relevancy, materiality or immateriality of certain
evidence and the burden of proof are within the authority of the
attorney to decide.10 Whatever decision an attorney makes on any
of these procedural questions, even if it adversely affects a client's
case, will generally bind a client. The agreement and modus
vivendi signed by petitioner's counsel is binding upon petitioners,
even if the Sanggunian had not authorized the same, limitation of
issues being a procedural question falling within the exclusive
authority of the attorney to decide.
In any case, the remaining issues raised by petitioner are likewise
devoid of merit, a province having no authority to impose taxes on
stones, sand, gravel, earth and other quarry resources extracted
from private lands. The pertinent provisions of the Local
Government Code are as follows:
Sec. 134. Scope of Taxing Powers. - Except as otherwise
provided in this Code, the province may levy only the taxes,
fees, and charges as provided in this Article.
Sec. 138. Tax on Sand, Gravel and Other Quarry Resources. -
The province may levy and collect not more than ten percent
(10%) of fair market value in the locality per cubic meter of
ordinary stones, sand, gravel, earth, and other quarry
resources, as defined under the National Internal Revenue
Code, as amended, extracted from public lands or from the
beds of seas, lakes, rivers, streams, creeks, and other public
waters within its territorial jurisdiction.
x x x (Italics supplied)
The appellate court, on the basis of Section 134, ruled that a
province was empowered to impose taxes only on sand, gravel, and
other quarry resources extracted from public lands, its authority to
tax being limited by said provision only to those taxes, fees and
charges provided in Article One, Chapter 2, Title One of Book II of
the Local Government Code.11 On the other hand, petitioners claim
that Sections 12912 and 18613 of the Local Government Code
authorizes the province to impose taxes other than those specifically
enumerated under the Local Government Code.
The Court of Appeals erred in ruling that a province can impose only
the taxes specifically mentioned under the Local Government Code.
As correctly pointed out by petitioners, Section 186 allows a
province to levy taxes other than those specifically enumerated
under the Code, subject to the conditions specified therein.
This finding, nevertheless, affords cold comfort to petitioners as
they are still prohibited from imposing taxes on stones, sand,
gravel, earth and other quarry resources extracted from private
lands. The tax imposed by the Province of Bulacan is an excise tax,
being a tax upon the performance, carrying on, or exercise of an
activity.14 The Local Government Code provides:
Section 133. - Common Limitations on the Taxing Powers of
Local Government Units. - Unless otherwise provided herein,
the exercise of the taxing powers of provinces, cities,
municipalities, and barangays shall not extend to the levy of
the following:
xxx
(h) Excise taxes on articles enumerated under the National
Internal Revenue Code, as amended, and taxes, fees or
charges on petroleum products;
xxx
A province may not, therefore, levy excise taxes on articles already
taxed by the National Internal Revenue Code. Unfortunately for
petitioners, the National Internal Revenue Code provides:
Section 151. - Mineral Products. -
(A) Rates of Tax. - There shall be levied, assessed and
collected on minerals, mineral products and quarry resources,
excise tax as follows:
xxx
(2) On all nonmetallic minerals and quarry resources, a
tax of two percent (2%) based on the actual market
value of the gross output thereof at the time of
removal, in case of those locally extracted or produced;
or the values used by the Bureau of Customs in
determining tariff and customs duties, net of excise tax
and value-added tax, in the case of importation.
xxx
(B) [Definition of Terms]. - For purposes of this Section, the term-
xxx
(4) Quarry resources shall mean any common stone or
other common mineral substances as the Director of
the Bureau of Mines and Geo-Sciences may declare to
be quarry resources such as, but not restricted to,
marl, marble, granite, volcanic cinders, basalt, tuff and
rock phosphate; Provided, That they contain no metal
or metals or other valuable minerals in economically
workable quantities.
It is clearly apparent from the above provision that the National
Internal Revenue Code levies a tax on all quarry resources,
regardless of origin, whether extracted from public or private land.
Thus, a province may not ordinarily impose taxes on stones, sand,
gravel, earth and other quarry resources, as the same are already
taxed under the National Internal Revenue Code. The province can,
however, impose a tax on stones, sand, gravel, earth and other
quarry resources extracted from public land because it is expressly
empowered to do so under the Local Government Code. As to
stones, sand, gravel, earth and other quarry resources extracted
from private land, however, it may not do so, because of the
limitation provided by Section 133 of the Code in relation to Section
151 of the National Internal Revenue Code.
Given the above disquisition, petitioners cannot claim that the
appellate court unjustly deprived them of the power to create their
sources of revenue, their assessment of taxes against Republic
Cement being ultra vires, traversing as it does the limitations set by
the Local Government Code.
Petitioners likewise aver that the appellate court's declaration of
nullity of its assessment against Republic Cement is a collateral
attack on Provincial Ordinance No. 3, which is prohibited by public
policy.15 Contrary to petitioners' claim, the legality of the ordinance
was never questioned by the Court of Appeals. Rather, what the
appellate court questioned was petitioners' assessment of taxes on
Republic Cement on the basis of Provincial Ordinance No. 3, not the
ordinance itself.
Furthermore, Section 21 of Provincial Ordinance No. 3 is practically
only a reproduction of Section 138 of the Local Government Code. A
cursory reading of both would show that both refer to ordinary
sand, stone, gravel, earth and other quarry resources extracted
from public lands. Even if we disregard the limitation set by Section
133 of the Local Government Code, petitioners may not impose
taxes on stones, sand, gravel, earth and other quarry resources
extracted from private lands on the basis of Section 21 of Provincial
Ordinance No. 3 as the latter clearly applies only to quarry
resources extracted from public lands. Petitioners may not invoke
the Regalian doctrine to extend the coverage of their ordinance to
quarry resources extracted from private lands, for taxes, being
burdens, are not to be presumed beyond what the applicable
statute expressly and clearly declares, tax statutes being
construed strictissimi juris against the government.16 cräläwvirtualibräry
WHEREFORE, premises considered, the instant petition is
DISMISSED for lack of merit and the decision of the Court of
Appeals is hereby AFFIRMED in toto. Costs against petitioner.
SO ORDERED.
