Universal Corn Products, Inc. v. Rice and Corn Board
REITERATIONFacts
The Antecedents: The underlying dispute concerns the employment of alien individuals by Universal Corn Products, Inc., a corporation wholly owned by Filipino citizens. The Rice and Corn Board, through Resolution No. 10, promulgated a regulation stating that no non-citizen could be employed in any capacity in Filipino-owned establishments engaged in the rice and/or corn industry, except for technical personnel authorized by the President upon recommendation of the Board. Petitioners argued that applying this resolution to their existing alien employees, who had been employed long before the enactment of Republic Act No. 3018 and the promulgation of Resolution No. 10, would be an unconstitutional retroactive application, depriving them of their livelihood without due process and equal protection. Procedural History: Universal Corn Products, Inc. and its alien employees filed an amended petition for declaratory relief seeking a judicial declaration that the construction placed by the Rice and Corn Board on Resolution No. 10, in conjunction with Section 2-A of Commonwealth Act No. 108, was illegal. They sought a ruling that their continued employment was permissible. The respondents, the National Rice and Corn Board and its officials, admitted the factual allegations but denied the legal conclusions. They contended that the employment of aliens in the regulated industry became unlawful upon the passage of Republic Act No. 3018 and the regulation, regardless of prior employment dates, and that the statute was a valid exercise of police power. The trial court dismissed the petition, leading to the present appeal. The Petition: The petitioners appealed the trial court's decision to the Supreme Court, seeking a reversal of the dismissal. Their primary arguments were that the interpretation of Resolution No. 10 and Section 2-A of Commonwealth Act No. 108, as applied to their alien employees, suffered from the vice of retroactivity and was unconstitutional. They contended that applying the resolution to employees hired before its enactment would be retroactive and violate due process and equal protection clauses. The appeal sought a judicial declaration to avoid this unconstitutional effect and to clarify the proper interpretation of the relevant laws and regulations.
Issue(s)
Whether the construction placed by the respondent Rice and Corn Board on its Resolution No. 10, in connection with Section 2-A of Commonwealth Act No. 108, suffers from the vice of retroactivity. Whether the said construction is unconstitutional on the grounds of violating due process and equal protection. Whether the action for declaratory relief was proper and if there was a cause of action.
Ruling
The judgment of the lower court dismissing the amended petition for declaratory relief is affirmed. The Supreme Court found no valid ground for reversal, upholding the construction placed by the respondent Rice and Corn Board on its Resolution No. 10 and Section 2-A of Commonwealth Act No. 108.
Ratio Decidendi
On the issue of retroactivity: The Court reiterated the established rule of statutory construction that statutes are to be construed prospectively unless the legislative intent for retrospective effect is expressly declared or necessarily implied. The Court found that Republic Act No. 3018, approved on August 2, 1960, and its implementing rules and regulations, were not applied retroactively. The Court cited previous rulings, such as Salcedo and Ignacio v. Carpio, which held that applying a law to a situation that continues after its effectivity, even if the appointment predates the law, does not constitute retroactive application. Furthermore, the Court referenced People v. Yu Bao and People v. Ong Tin, clarifying that laws penalize acts committed after their effectivity, not those that were legal at their inception but became penalized later. Therefore, the imputation of retroactivity lacked legal support. On the issue of unconstitutionality (due process and equal protection): The Court found the petitioners' apprehension regarding unconstitutionality to be unjustified. It referenced the significant ruling in King v. Hernaez, which affirmed the constitutionality of nationalizing employment in the Philippines. The Court explained that such measures, aimed at promoting the welfare and material progress of citizens, fall within the scope of the State's police power. The nationalization of employment, like the nationalization of the retail trade, is a valid exercise of police power, designed to protect citizens and enhance their pursuit of happiness. The Court emphasized that the aim is not to deprive citizens of rights but to promote their welfare. The limitation on the sphere of choice for employers to citizens, excluding aliens, is a legitimate policy objective. On the propriety of declaratory relief and cause of action: While not explicitly detailed in the provided text, the Court's affirmation of the lower court's dismissal implies that either the action for declaratory relief was deemed improper under the circumstances or that no cause of action was sufficiently established to warrant the relief sought. The respondents had also disputed the propriety of the action and the absence of a cause of action in their answer. The Court's focus on the substantive issues of retroactivity and constitutionality suggests that these were the primary grounds for its decision, implicitly resolving any procedural objections in favor of the dismissal.
Main Doctrine
The construction placed by the Rice and Corn Board on its Resolution No. 10, in connection with Section 2-A of Commonwealth Act No. 108, requiring the dismissal of alien personnel employed prior to the enactment of Republic Act No. 3018 and the promulgation of Resolution No. 10, does not suffer from the vice of retroactivity nor is it unconstitutional. Such a measure, aimed at the nationalization of employment, falls within the scope of the State's police power to promote the welfare of its citizens.