G.R. No.
L-19650 September 29, 1966
CALTEX (PHILIPPINES), INC., petitioner-appellee,
vs.
ENRICO PALOMAR, in his capacity as THE POSTMASTER GENERAL, respondent-appellant.
Office of the Solicitor General for respondent and appellant.
Ross, Selph and Carrascoso for petitioner and appellee.
FACTS:
In the year 1960 the Caltex (Philippines) Inc. (hereinafter referred to as Caltex) conceived a promotional
scheme which will increase its patronage for oil products called “Caltex Hooded Pump Contest.” The contest
calls for participants to estimate the number of liters a hooded gas pump at each Caltex station will dispense
during a specified period. To participate, entry forms are only needed which can be made available upon request
at each Caltex station. No fee or consideration is required to be paid nor purchase of Caltex products has to be
made prior to participation.
A three-staged winner selection system is envisioned. At the station level, called "Dealer Contest", the
contestant whose estimate is closest to the actual number of liters dispensed by the hooded pump thereat is to be
awarded the first prize and will then be qualified to join in the "Regional Contest" in seven different regions. The
winning stubs of the qualified contestants in each region will be deposited in a sealed can from which the first-prize,
second-prize and third-prize winners of that region will be drawn. The regional first-prize winners will be entitled to
make a three-day all-expenses-paid round trip to Manila. At the national level, the stubs of the seven regional first-
prize winners will be placed inside a sealed can from which the drawing for the final first-prize, second-prize and
third-prize winners will be made. Cash prizes in store for winners at this final stage are: P3,000 for first; P2,000 for
second; Pl,500 for third; and P650 as consolation prize for each of the remaining four participants.
Foreseeing the extensive use of mails to publicize the promotional scheme, Caltex made representations
with the postal authorities to secure advanced clearance for mailing. Caltex, through its counsel, posited that the
contest does not violate anti-lottery provisions of the Postal Law. The Postmaster General Palomar declined the
grant of the requested clearance. Caltex sought a reconsideration. Palomar maintained that if the contest was
pursued, a fraud order will be issued against Caltex. Thus, this case at bar.
ISSUES:
1. Whether or not the petition states a sufficient cause of action for declaratory relief
2. Whether or not the proposed contest violates the Postal Law
RULINGS:
Yes. The petition states a sufficient cause of action for declaratory relief.
The Court held that the petition states a sufficient cause of action for declaratory relief since it qualifies
for the 4 requisites on invoking declaratory relief available to any person whose rights are affected by a statute
to determine any question of construction or validity. To the petitioner, the construction hampers or disturbs its
freedom to enhance its business while to the respondent, suppression of the petitioner’s proposed contest
believed to transgress the law he has sworn to uphold and enforce is an unavoidable duty.
No. The proposed contest does not violate the Postal Law.
Likewise, using the rules of Statutory Construction in discovering the meaning and intention of the
authors in a case clouded with doubt as to its application, it was held that the promotional scheme does not
violate the Postal Law in that it does not entail lottery or gift enterprise. Using the principle “noscitur a sociis’,
the term under construction shall be understood by the words preceding and following it. Thus, using the
definitions of lottery and gift enterprise which both has the requisites of prize, chance and consideration, the
promo contest does not clearly violate the Postal Law because of lack of consideration.
