Caltex vs. Palomar (Digest)

 

Digest: Caltex v. Palomar (GR L-19650, 29 September 1966) Posted by Berne Guerrero under (a) oas , digests   Caltex v. Palomar GR L-19650, 29 September 1966 (18 SCRA 247) En Banc, Castro (p): 9 concurring Facts: In 1960, Caltex (Phils) Inc. conceived a promotional scheme “Caltex Hooded Pump Contest” calculated to drum up patronage its products, calling for participants therein to estimate the actual number of liters a for hooded gas pump at each Caltex station will disp dispen ense se du duri ring ng a sp spec ecif ifie ied d peri period od.. Fo Forr th the e pr priv ivil ileg ege e to pa part rtic icip ipat ate, e, no fee fee or consideration is required to be paid. Neither a purchase of Caltex products is required. Entry forms were available upon request at each Caltex station where a sealed can was provided for the deposit of accomplished entry stubs. Foreseeing the extensive use of  the mails, not only as amongst the mediator publicizing the contest but also for the transmission of communications relative thereto, representations were made by Caltex with the postal authorities for the contest to be cleared in advance for mailing, in view of  sections 1954(a), 1982 and 1983 of the Revised Administrative Code. Such overtures were formalized in a letter to the Postmaster General, dated 31 October 1960, in which the Caltex, thru counsel, enclosed a copy of the contest rules and endeavored to justify its position that the contest does not violate the anti-lottery provisions of the Postal Law. Unimpr Uni mpress essed, ed, the then then Acting Acting Postm Postmast aster er Genera Generall Enr Enrico ico Pa Palom lomar ar opined opined that that the scheme falls within the purview of the provisions aforesaid and declined to grant the requested clearance. Caltex thereupon invoked judicial intervention by filing a petition for declaratory relief  against the Postmaster General, praying that judgment be rendered declaring its Caltex Hooded Pump Contest not to be violative of the Postal Law, and ordering respondent to allow petitioner the use of the mails to bring the contest to the attention of the public.   The trial court ruled that the contest does not violate the Postal Code and that the Postmaster General has no right to bar the public distribution of the contest rules by the mails. The Postmaster General appealed to the Supreme Court. Issue(s): Whether construction should be employed in the case. Whether the contest is a lottery or a gift enterprise that violates the provisions of  the Postal Law. •

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Held: Construction is the art or process of discovering and expounding the meaning and intention of the ofdoubtful, the law with respect to itsby application given case, that intention is authors rendered amongst others, reason of to thea fact that thewhere given ca case se is not not ex expl plic icit itly ly prov provid ided ed for for in th the e la law. w. In th the e pr pres esen entt case case,, th the e pr proh ohib ibit itiv ive e provisions of the Postal Law inescapably require an inquiry into the intended meaning of  the words used therein. This is as much a question of construction or interpretation as any other. The Court is tasked to look beyond the fair exterior, to the substance, in order to unmask the real element and pernicious tendencies that the law is seeking to prevent. “Lottery” extends to all schemes for the distribution of prizes by chance, such as policy playin pla ying, g, gift gift ex exhib hibiti itions ons,, prize prize concer concerts, ts, raffle raffles s at fairs, fairs, etc., etc., and variou various s for forms ms of  gambling. The three essential elements of a lottery are: (1) consideration, (2) prize, and (3) cha chance nce.. “Gift “Gift enterp enterpris rise,” e,” on the ot other her hand, hand, is co comm mmonl only y applie applied d to a spo sporti rting ng artifice under which goods are sold for their market value but by way of inducement each purcha pur chaser ser is given given a chance chance to wi win n a prize. prize. Furthe Further, r, conso consonan nantt to the well-kno well-known wn principle of legal hermeneutics noscitur a sociis, the term under construction should be accorded no other meaning than that which is consistent with the nature of the word associated therewith. Hence, if lottery if it involves a consideration, so also must the term “gift enterprise” be is soprohibited construed.only Significantly, there is not in the law the slightest indicium of any intent to eliminate that element of consideration from the “gift enterprise” therein included. Gratuitous distribution of property by lot or chance

 

does not constitute ‘lottery’, if it is not resorted to as a device to evade the law and no consid con sidera eratio tion n is derive derived, d, direct directly ly or indire indirectl ctly, y, from from the party party rec receiv eiving ing the chance chance,, gambling spirit not being cultivated or stimulated thereby. Thus, gift enterprises and simila sim ilarr scheme schemes s therei therein n contem contempla plated ted are con condem demnab nable le only only if, like like lot lotter teries ies,, they they involve the element of consideration. In the present case, there is no requirement in the rules that any fee be paid, any merchandise be bought, any service be rendered, or any value whatsoever be given for the privilege to participate; for the scheme to be deemed a lottery. Neither is there is a sale of anything to which the chance offered is attached as an inducement to the purchaser for the scheme to be deemed a gift enterprise. The scheme is merely a gratuitous distribution of property by chance.  The Supreme Court affirmed the appealed judgment, without costs.