Ichong vs Hernandez GR L-7995, may 31, 1957
ICHONG v HERNANDEZ
G.R. NO. L-7995 May 31,
1957
(1) a prohibition against
persons, not citizens of the Philippines, and against associations, partnerships,
or corporations the capital of which are not wholly owned by citizens of the
Philippines, from engaging directly or indirectly in the retail trade;
(2) an exception from the
above prohibition in favor of aliens actually engaged in said business on May
15, 1954, who are allowed to continue to engaged therein, unless their licenses
are forfeited in accordance with the law, until their death or voluntary
retirement in case of natural persons, and for ten years after the approval of the
Act or until the expiration of term in case of juridical persons;
(3) an exception therefrom in
favor of citizens and juridical entities of the United States;
(4) a provision for the
forfeiture of licenses (to engage in the retail business) for violation of the
laws on nationalization, control weights and measures and labor and other laws
relating to trade, commerce and industry;
(5) a prohibition against the
establishment or opening by aliens actually engaged in the retail business of
additional stores or branches of retail business;
(6) a provision requiring
aliens actually engaged in the retail business to present for registration with
the proper authorities a verified statement concerning their businesses,
giving, among other matters, the nature of the business, their assets and
liabilities and their offices and principal offices of judicial entities; and
(7) a provision allowing the
heirs of aliens now engaged in the retail business who die, to continue such
business for a period of six months for purposes of liquidation.
Petitioner Inchong, for and in his own behalf and on behalf of other
alien resident corporations and partnerships adversely affected by the
provisions of Republic Act. No. 1180, brought this action to obtain a judicial
declaration that said Act is unconstitutional, and to enjoin the Secretary of
Finance and all other persons acting under him, particularly city and municipal
treasurers, from enforcing its provisions. Inchong attacks the
constitutionality of the Act, contending that:
(1) it denies to alien
residents the equal protection of the laws and deprives of their liberty and
property without due process of law ;
(2) the subject of the Act is
not expressed or comprehended in the title thereof; (3) the Act violates international and treaty obligations of the
Republic of the Philippines;
(4) the provisions of the Act
against the transmission by aliens of their retail business thru hereditary
succession, and those requiring 100% Filipino capitalization for a corporation
or entity to entitle it to engage in the retail business, violate the spirit of
Sections 1 and 5, Article XIII and Section 8 of Article XIV of the
Constitution.
In answer, the Solicitor-General and
the Fiscal of the City of Manila contend that:
(1) the Act was passed in the valid
exercise of the police power of the State, which exercise is authorized in the
Constitution in the interest of national economic survival;
(2) the Act has only one subject
embraced in the title;
(3) no treaty or international
obligations are infringed;
(4) as regards hereditary succession,
only the form is affected but the value of the property is not impaired, and
the institution of inheritance is only of statutory origin.
ISSUE:
WON RA 1180 is unconstitutional since its exercise violates one’s right
to due process and equal protection as guaranteed by the Constitution
RULING:
NO. The Court finds the enactment of RA 1180 to clearly fall within the
scope of police power of the State. It is clear that the law in question was
enacted to remedy a real and actual threat and danger to the national economy
posed by alien dominance and control of retail business and free citizens and
country from the said dominance and control.
It has been said the police power is so far - reaching in scope, that it
has become almost impossible to limit its sweep. As it derives its existence
from the very existence of the State itself, it does not need to be expressed
or defined in its scope; it is said to be co-extensive with self-protection and
survival, and as such it is the most positive and active of all governmental
processes, the most essential, insistent and illimitable. Especially is it so
under a modern democratic framework where the demands of society and of nations
have multiplied to almost unimaginable proportions; the field and scope of
police power has become almost boundless, just as the fields of public interest
and public welfare have become almost all-embracing and have transcended human
foresight. However, the Constitution has set forth limitations thereof and the
most important of these are: the due process clause and the equal protection
clause.
The conflict, therefore, between police power and the guarantees of due
process and equal protection of the laws is more apparent than real. Properly
related, the power and the guarantees are supposed to coexist. The balancing is
the essence or, shall it be said, the indispensable means for the attainment of
legitimate aspirations of any democratic society. There can be no absolute
power, whoever exercise it, for that would be tyranny. Yet there can neither be
absolute liberty, for that would mean license and anarchy. So the State can
deprive persons of life, liberty and property, provided there is due process of
law; and persons may be classified into classes and groups, provided everyone
is given the equal protection of the law. The test or standard, as always, is
reason. The police power legislation must be firmly grounded on public interest
and welfare, and a reasonable relation must exist between purposes and means.
And if distinction and classification has been made, there must be a reasonable
basis for said distinction.
The best evidence to determine the alien dominance in retail business
are the statistics on the retail trade, which put down the figures in black and
white. Between the constitutional convention year (1935), when the fear of
alien domination and control of the retail trade already filled the minds of
our leaders with fears and misgivings, and the year of the enactment of the
nationalization of the retail trade act (1954), official statistics
unmistakably point out to the ever-increasing dominance and control by the
alien of the retail trade. Statistical figures reveal that in percentage
distribution of assets and gross sales, alien participation has steadily
increased during the years. It is true, of course, that Filipinos have the edge
in the number of retailers, but aliens more than make up for the numerical gap
through their assets and gross sales which average between six and seven times
those of the very many Filipino retailers.
The Court finds that the law does not also violate the equal protection
clause of the Constitution because sufficient grounds exist for the distinction
between alien and citizen in the exercise of the occupation regulated, nor the
due process of law clause, because the law is prospective in operation and
recognizes the privilege of aliens already engaged in the occupation and
reasonably protects their privilege. The wisdom and efficacy of the law to
carry out its objectives appear to us to be plainly evident — as a matter of
fact it seems not only appropriate but actually necessary — and that in any
case such matter falls within the prerogative of the Legislature, with whose
power and discretion the Judicial department of the Government may
not interfere.
Therefore, petition is denied.
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