Caltex vs. Palomar

June 13th, 2007 Shobe_ceo

Case Title: G.R. No. L-19650 (September 29, 1966)
Caltex (Philippines), Inc. vs. Enrico Palomar in his capacity as The Postmaster General

1) Facts

The case before us now is a petition for declaratory relief against Postmaster General Enrico Palomar, parying “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”.

In 1960, Caltex launched a promotional scheme called “Caltex Hooded Pump Contest� which calls for participants to “estimate the actual number of liters a hooded gas pump at each Caltex station will dispense during a specified period.� The contest is open to all “motor vehicle owners and/or licensed drivres�. There is neither a fee or consideration required nor a purchase required to be made. The forms are available upon request at each Caltex station and there is also a sealed can where accomplished entry stubs may be deposited.

Caltex wishes to use mails amongst the media for publicizing about the contest, thus, Caltex sent representatives to the postal authorities for advance clearing for the use of mails for the contest. However, the postal authorities denied their request in view of sections 1954 (a), 1982, and 1983 of the Revised Administrative Code (Anti-lottery provisions of the Postal Law), which prohibits the use of mail in conveying any information concerning non-mailable schemes, such as lottery, gift enterprise, or similar scheme.

Caltex sought for a reconsideration and stressed that there was no consideration involved in the part of the contestant(s) but the Postmaster General maintained their view and even threatened Caltex that if the contest was conducted, “a fraud order will have to be issued against it (Caltex) and all its representativesâ€?. This leads to Caltex’s filing of this petition for declaratory relief.

The court ruled that the “petitioner does not violate the Postal Law and the respondent has no right to bar the public distribution or said rules by the mails�. The respondent then appealed.

2) Issue(s)

a) Whether or not the petition states a sufficient cause of action for declaratory relief?

b) Whether or not the proposed “Caltex Hooded Pump Contest� violates the Postal Law?

3) Ruling

Recapitulating, we hold that the petition herein states a sufficient cause of action for declaratory relief, and that the “Caltex Hooded Pump Contest” as described in the rules submitted by the appellee does not transgress the provisions of the Postal Law.

ACCORDINGLY, the judgment appealed from is affirmed. No costs.

4) Ratio

Declaratory Relief is the interpretation of several constitutional provisions. Based on Section 1 Rule 63 of the Rules of Court, an action for declaratory relief should be filed by a person interested under a deed, a will, a contract or other written instrument, and whose rights are affected by a statute, an executive order, a regulation or an ordinance.

Requisites for Declaratory Relief:
- There is justiciable controversy
- The controversy is between persons whose interests are adverse
- The party seeking the relief has a legal interest in the controversy
- The issue is ripe for judicial determination

* The “Caltex Hooded Pump Contest� is a mere “gratuitous distribution of property by chance�. It does not qualify as a lottery due to the lack of consideration. An act to be deemed as a lottery must constitute a (1) prize, (2) chance, and (3) consideration. The participants are not required to do anything or purchase anything from Caltex in order to participate in the contest. The true test for having consideration is “whether the participant pays a valuable consideration for the chance, and not whether those conducting the enterprise receive something of value in return for the distribution of the prize.�

*Perspective properly oriented, the standpoint of the contestant is all that matters, not that of the sponsor.

Entry Filed under: Atenista, For the Mind, Life of Law, Philippine Cases, Philippines, Shobe_CEO

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