whether the compromise entered into is also valid

Validity of Compromise

It would be premature for this Court to declare that the compromise on the estate tax liability has been perfected and consummated, considering the earlier determination that the assessment against the estate was void. Nothing has been settled or finalized. Under Section 204(A) of the Tax Code, where the basic tax involved exceeds one million pesos or the settlement offered is less than the prescribed minimum rates, the compromise shall be subject to the approval of the NEB composed of the petitioner and four deputy commissioners.

Finally, as correctly held by the appellate court, this provision applies to all compromises, whether government-initiated or not. Ubi lex non distinguit, nec nos distinguere debemos. Where the law does not distinguish, we should not distinguish.

WHEREFORE, the Petition is hereby DENIED and the assailed Decision AFFIRMED. No pronouncement as to costs.

SO ORDERED.

SOURCE: [ G.R. NO. 159694, January 27, 2006 ]COMMISSIONER OF INTERNAL REVENUE, PETITIONER, VS. AZUCENA T. REYES, RESPONDENT.
[G.R. NO. 163581]AZUCENA T. REYES, PETITIONER, VS. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT. Tags: Remigio Sante Fe Santander Sibonga Sogod Tabogon Tabuelan Tuburan attorney’s fees Tudela exemplary damages Camotes General Luna Siargao Cagayan Davao Kidapawan Attorney Abogado Lawyer Architect Real Estate Broker nominal damages Sales Agent Properties for Sale Looking for Buyers Design Build House and Lot for Sale for Rent Talisay City Mandaue City Lapu Lapu Lapu-Lapu City Yncierto Sesante Villanueva Ruz Jan Edmond Marc Tim Timothy temperate damages Luz liquidated damages Kristin tct transfer certificate of title tax declaration birth certificate relocation survey surveying judicial titling administrative titling patent title denr cenro foreshore lease ecc environmental compliance certificate design build architect cebu engineer interior design designer residential commercial cebu property warehouse for rent for lease marc Christian yncierto ruz jan Edmond yncierto ruz Kristin Villanueva ruz Edmond mabalot ruz marriage certificate timber land forest land watershed agricultural lot land use conversion hearing trial illegal drugs trial lawyer business corporate lawyer labor lawyer immigration law bureau of immigration cebu 9g visa search warrant warrant of arrest motion to quash information complaint police officers buy bust physical suffering shocked horrified mental anguish fright serious anxiety besmirched reputation sleepless nights wounded feelings moral shock social humiliation similar injuries Alcantara Alcoy moral damages Alegria actual damages Aloguinsan Argao Asturias Badian Balamban Bantayan Barili Boljoon Borbon Carmen Catmon Compostela Consolacion Cordova Daanbantayan Dumaguete Bais Sibulan Tampi Bacong Negros Bacolod Separation pay Resign Resignation Back wages Backwages Length of service pay benefit employee employer relationship Silay Kabankalan Daan Bantayan Dalaguete Dumanjug Ginatilan Liloan compensatory damages Madridejos Malabuyoc Medellin Minglanilla Moalboal Oslob Pilar Pinamungajan Poro Ronda Samboan San Fernando San Francisco San

Whether petitioner’s assessment against the estate is valid

Validity of the Assessment Against the Estate


The second paragraph of Section 228 of the Tax Code is clear and mandatory. It provides as follows:

“Sec. 228. Protesting of Assessment. —

“The taxpayers shall be informed in writing of the law and the facts on which the assessment is made: otherwise, the assessment shall be void.”

In the present case, Reyes was not informed in writing of the law and the facts on which the assessment of estate taxes had been made. She was merely notified of the findings by the CIR, who had simply relied upon the provisions of former Section 229 prior to its amendment by Republic Act (RA) No. 8424, otherwise known as the Tax Reform Act of 1997.

First, RA 8424 has already amended the provision of Section 229 on protesting an assessment. The old requirement of merely notifying the taxpayer of the CIR’s findings was changed in 1998 to informing the taxpayer of not only the law, but also of the facts on which an assessment would be made; otherwise, the assessment itself would be invalid.

It was on February 12, 1998, that a preliminary assessment notice was issued against the estate. On April 22, 1998, the final estate tax assessment notice, as well as demand letter, was also issued. During those dates, RA 8424 was already in effect. The notice required under the old law was no longer sufficient under the new law.

To be simply informed in writing of the investigation being conducted and of the recommendation for the assessment of the estate taxes due is nothing but a perfunctory discharge of the tax function of correctly assessing a taxpayer. The act cannot be taken to mean that Reyes already knew the law and the facts on which the assessment was based. It does not at all conform to the compulsory requirement under Section 228. Moreover, the Letter of Authority received by respondent on March 14, 1997 was for the sheer purpose of investigation and was not even the requisite notice under the law.

The procedure for protesting an assessment under the Tax Code is found in Chapter III of Title VIII, which deals with remedies. Being procedural in nature, can its provision then be applied retroactively? The answer is yes.

The general rule is that statutes are prospective. However, statutes that are remedial, or that do not create new or take away vested rights, do not fall under the general rule against the retroactive operation of statutes. Clearly, Section 228 provides for the procedure in case an assessment is protested. The provision does not create new or take away vested rights. In both instances, it can surely be applied retroactively. Moreover, RA 8424 does not state, either expressly or by necessary implication, that pending actions are excepted from the operation of Section 228, or that applying it to pending proceedings would impair vested rights.

Second, the non-retroactive application of Revenue Regulation (RR) No. 12-99 is of no moment, considering that it merely implements the law.

A tax regulation is promulgated by the finance secretary to implement the provisions of the Tax Code. While it is desirable for the government authority or administrative agency to have one immediately issued after a law is passed, the absence of the regulation does not automatically mean that the law itself would become inoperative.

At the time the pre-assessment notice was issued to Reyes, RA 8424 already stated that the taxpayer must be informed of both the law and facts on which the assessment was based. Thus, the CIR should have required the assessment officers of the Bureau of Internal Revenue (BIR) to follow the clear mandate of the new law. The old regulation governing the issuance of estate tax assessment notices ran afoul of the rule that tax regulations — old as they were — should be in harmony with, and not supplant or modify, the law.

It may be argued that the Tax Code provisions are not self-executory. It would be too wide a stretch of the imagination, though, to still issue a regulation that would simply require tax officials to inform the taxpayer, in any manner, of the law and the facts on which an assessment was based. That requirement is neither difficult to make nor its desired results hard to achieve.

Moreover, an administrative rule interpretive of a statute, and not declarative of certain rights and corresponding obligations, is given retroactive effect as of the date of the effectivity of the statute. RR 12-99 is one such rule. Being interpretive of the provisions of the Tax Code, even if it was issued only on September 6, 1999, this regulation was to retroact to January 1, 1998 — a date prior to the issuance of the preliminary assessment notice and demand letter.

Third, neither Section 229 nor RR 12-85 can prevail over Section 228 of the Tax Code.

No doubt, Section 228 has replaced Section 229. The provision on protesting an assessment has been amended. Furthermore, in case of discrepancy between the law as amended and its implementing but old regulation, the former necessarily prevails. Thus, between Section 228 of the Tax Code and the pertinent provisions of RR 12-85, the latter cannot stand because it cannot go beyond the provision of the law. The law must still be followed, even though the existing tax regulation at that time provided for a different procedure. The regulation then simply provided that notice be sent to the respondent in the form prescribed, and that no consequence would ensue for failure to comply with that form.

Fourth, petitioner violated the cardinal rule in administrative law that the taxpayer be accorded due process. Not only was the law here disregarded, but no valid notice was sent, either. A void assessment bears no valid fruit.

The law imposes a substantive, not merely a formal, requirement. To proceed heedlessly with tax collection without first establishing a valid assessment is evidently violative of the cardinal principle in administrative investigations: that taxpayers should be able to present their case and adduce supporting evidence. In the instant case, respondent has not been informed of the basis of the estate tax liability. Without complying with the unequivocal mandate of first informing the taxpayer of the government’s claim, there can be no deprivation of property, because no effective protest can be made. The haphazard shot at slapping an assessment, supposedly based on estate taxation’s general provisions that are expected to be known by the taxpayer, is utter chicanery.

Even a cursory review of the preliminary assessment notice, as well as the demand letter sent, reveals the lack of basis for — not to mention the insufficiency of — the gross figures and details of the itemized deductions indicated in the notice and the letter. This Court cannot countenance an assessment based on estimates that appear to have been arbitrarily or capriciously arrived at. Although taxes are
the lifeblood of the government, their assessment and collection “should be made in accordance with law as any arbitrariness will negate the very reason for government itself.”

Fifth, the rule against estoppel does not apply. Although the government cannot be estopped by the negligence or omission of its agents, the obligatory provision on protesting a tax assessment cannot be rendered nugatory by a mere act of the CIR .

Tax laws are civil in nature. Under our Civil Code, acts executed against the mandatory provisions of law are void, except when the law itself authorizes the validity of those acts. Failure to comply with Section 228 does not only render the assessment void, but also finds no validation in any provision in the Tax Code. We cannot condone errant or enterprising tax officials, as they are expected to be vigilant and law-abiding.

SOURCE: [ G.R. NO. 159694, January 27, 2006 ]COMMISSIONER OF INTERNAL REVENUE, PETITIONER, VS. AZUCENA T. REYES, RESPONDENT.[G.R. NO. 163581]
AZUCENA T. REYES, PETITIONER, VS. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT. Tags: Alcantara Alcoy moral damages Alegria actual damages Aloguinsan Argao Asturias Badian Balamban Bantayan Barili Boljoon Borbon Carmen Catmon Compostela Consolacion Cordova Daanbantayan Dumaguete Bais Sibulan Tampi Bacong Negros Bacolod Separation pay Resign Resignation Back wages Backwages Length of service pay benefit employee employer relationship Silay Kabankalan Daan Bantayan Dalaguete Dumanjug Ginatilan Liloan compensatory damages Madridejos Malabuyoc Medellin Minglanilla Moalboal Oslob Pilar Pinamungajan Poro Ronda Samboan San Fernando San Francisco San Remigio Sante Fe Santander Sibonga Sogod Tabogon Tabuelan Tuburan attorney’s fees Tudela exemplary damages Camotes General Luna Siargao Cagayan Davao Kidapawan Attorney Abogado Lawyer Architect Real Estate Broker nominal damages Sales Agent Properties for Sale Looking for Buyers Design Build House and Lot for Sale for Rent Talisay City Mandaue City Lapu Lapu Lapu-Lapu City Yncierto Sesante Villanueva Ruz Jan Edmond Marc Tim Timothy temperate damages Luz liquidated damages Kristin tct transfer certificate of title tax declaration birth certificate relocation survey surveying judicial titling administrative titling patent title denr cenro foreshore lease ecc environmental compliance certificate design build architect cebu engineer interior design designer residential commercial cebu property warehouse for rent for lease marc Christian yncierto ruz jan Edmond yncierto ruz Kristin Villanueva ruz Edmond mabalot ruz marriage certificate timber land forest land watershed agricultural lot land use conversion hearing trial illegal drugs trial lawyer business corporate lawyer labor lawyer immigration law bureau of immigration cebu 9g visa search warrant warrant of arrest motion to quash information complaint police officers buy bust physical suffering shocked horrified mental anguish fright serious anxiety besmirched

May an elder sister adopt a younger brother?

The text below are from an old Supreme Court Case –

The issue before Us is, whether or not an elder sister may adopt a younger brother.
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The trial court dismissed the petition reasoning thus:
“A critical consideration in this case is the fact that the parents of the minor to be adopted are also the parents of the petitioner-wife. The minor, therefore, is the latter’s legitimate brother.
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“In this proceeding, the adoption will result in an incongruous situation where the minor Edwin Villa, a legitimate brother of the petitioner-wife, will also be her son. In the opinion of the court, that incongruity, not neutralized by other circumstances absent herein, should prevent the adoption.”
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The petitioners moved to reconsider the decision but the same was denied. Hence, this appeal.
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The facts are not disputed.
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The above-named spouses filed the petition before the court a quo on January 8, 1963, praying that the minor Edwin Villa y Mendoza, 4 years old, be declared their (petitioners’) son by adoption. Evidence was presented that the order setting the case for hearing has been duly published, Exhibit A. There having been no opposition registered to the petition, the petitioners were permitted to adduce their evidence.
It was established that the petitioners are both 32 years of age, Filipinos, residing in the City of Manila. They were married in 1957 and have maintained a conjugal home of their own. They do not have a child of their own blood. Neither spouse has any legitimate, legitimated, illegitimate, acknowledged natural child, or natural child by legal fiction; nor has any one of them been convicted of a crime involving moral turpitude. Edwin Villa y Mendoza, 4 years old, is a child of Francisco Villa and Florencia Mendoza who are the common parents of the petitioner-wife Edipola Villa Santos and the minor. Luis E. Santos, Jr., is a lawyer, with business interests in a textile development enterprise and the IBA electric plant, and is the general manager of Medry, Inc. and the secretary-treasurer of Bearen Enterprises. His income is approximately P600.00 a month. His co-petitioner-wife, is a nurse by profession, with an average monthly earning of about P300.00.
.

It was also shown that Edwin Villa y Mendoza was born on May 22, 1958, Exhibit C. He was a sickly child since birth. Due to the child’s impairing health, his parents entrusted him to the petitioners who reared and brought him up for the years thereafter, and as a result, there developed between the petitioners and the child, a deep and profound love for each other. The natural parents of the minor testified that they have voluntarily given their consent to the adoption of their son by the petitioners, and submitted their written consent and conformity to the adoption, and that they fully understand the legal consequences of the adoption of their child by the petitioners.
.

We are not aware of any provision in the law, and none has been pointed to Us by the Solicitor General who argues for the State in this case, that relatives, by blood or by affinity, are prohibited from adopting one another. The only objection raised is the alleged “incongruity” that will result in the relation of the petitioner-wife and the adopted, in the circumstance that the adopted who is the legitimate brother of the adopter, will also be her son by adoption. The theory is, therefore, advanced that adoption among people who are related by nature should not be allowed, in order that dual relationship should not result, reliance being made upon the views expressed by this Court in McGee vs. Republic, L-5387, April 29, 1954, 94 Phil. 820.
.

In that case, an American citizen, Clyde E. McGee, married to a Filipina by whom he had one child, instituted a proceeding for the adoption of two minor children of the wife had by her first husband. The lower court granted the petition of McGee to adopt his two minor step-children. On appeal by the State, We reversed the decision. We said:
.

“The purpose of adoption is to establish a relationship of paternity and filiation where none existed before. Where therefore the relationship of parents and child already exists whether by blood or by affinity as in the case of illegitimate and step-children, it would be unnecessary and superfluous to establish and superimpose another relationship of parent and child through adoption. Consequently, an express authorization of law like article 338 is necessary, if not to render it proper and legal, at least, to remove any and all doubt on the subject matter. Under this view, article 338 may not be regarded as a surplusage. That may have been the reason why in the old Code of Civil Procedure, particularly its provisions regarding adoption, authority to adopt a step-child by a step-father was provided in section 766 notwithstanding the general authorization in section 765 extended to any inhabitant of the Philippines to adopt a minor child. The same argument of surplusage could plausibly have been advanced as regards section 766, that is to say, section 766 was unnecessary and superfluous because without it a step-father could adopt a minor step- child anyway.

.

However, the inserting of section 766 was not entirely without reason. It seems to be an established principle in American jurisprudence that a person may not adopt his own relative, the reason being that it is unnecessary to establish a relationship where such already exists (the same philosophy underlying our codal provisions on adoption).

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So some states have special laws authorizing the adoption of relatives such as a grandfather adopting a grandchild and a father adopting his illegitimate of natural child.”
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Notwithstanding the views thus expressed, a study of American precedents would reveal that there is a variance in the decisions of the courts in different jurisdictions regarding the matter of adoption of relatives. It cannot be stated as a general proposition that the adoption of a blood relative is contrary to the policy of the law, for in many states of the Union, no restriction of that sort is contained in the statutes authorizing adoption, although laws of other jurisdictions expressly provide that adoption may not take place within persons within a certain degree of relationship (1 Am. Jur. 628-629). Courts in some states hold that in the absence of express statutory restriction, a blood relationship between the parties is not a legal impediment to the adoption of one by the other, and there may be a valid adoption where the relation of parent and child already exists by nature (2 Am. Jur. 2d 869). Principles vary according to the particular adoption statute of a state under which any given case is considered. It would seem that in those states originally influenced by the civil law countries where adoption originated, the rules are liberally construed, while in other states where common law principles predominate, adoption laws are more strictly applied because they are regarded to be in derogation of the common law.
.

Article 335 of the Civil Code enumerates those persons who may not adopt, and it has been shown that petitioners-appellants herein are not among those prohibited from adopting. Article 339 of the same code names those who cannot be adopted, and the minor child whose adoption is under consideration, is not one of those excluded by the law. Article 338, on the other hand, allows the adoption of a natural child by the natural father or mother, of other illegitimate children by their father or mother, and of a step-child-by the step-father or step-mother. This last article is, of course, necessary to remove all doubts that adoption is not prohibited even in these cases where there already exist a relationship of parent and child between them by nature. To say that adoption should not be allowed when the adopter and the adopted are related to each other, except in these cases enumerated in Article 338, is to preclude adoption among relatives no matter how far removed or in whatever degree that relationship might be, which in our opinion is not the policy of the law. The interest and welfare of the child to be adopted should be of paramount consideration. Adoption statutes, being humane and salutary, and designed to provide homes, care and education for unfortunate children, should be construed so as to encourage the adoption of such children by person who can properly rear and educate them (In re Havsgord’s Estate, 34 S.D. 131, 147 N.W. 378).
.

With respect to the objection that the adoption in this particular case will result in a dual relationship between the parties, that the adopted brother will also be the son of the adopting elder sister, that fact alone should not prevent the adoption. One is by nature, while the other is by fiction of law. The relationship established by the adoption is limited to the adopting parents and does not extend to their other relatives, except as expressly provided by law. Thus, the adopted child cannot be considered as a relative of the ascendants and collaterals of the adopting parents, nor of the legitimate children which they may have after the adoption except that the law imposes certain impediments to marriage by reason of adoption. Neither are the children of the adopted considered as descendants of the adopter (Tolentino, Civil Code, Vol. I, 1960 Ed., p. 652, citing 1 Oyuelos 284; Perez Gonzales and Castan; 4-11 Enneccerus, Kipp & Wolff 177; Muñoz, p. 104). So even considered in relation to the rules on succession which are in pari materia, the adoption under consideration would not be objectionable on the ground alone of the resulting dual relationship between the adopter and the adopted. Similar dual relationships also result under our law on marriage when persons who are already related, by blood or by affinity, marry each other. But as long as the relationship is not within the degrees prohibited by law, such marriages are allowed, notwithstanding the resulting dual relationship. And as We do not find any provision in the law that expressly prohibits adoption among relatives, they ought not to be prevented.
.

For all the foregoing considerations, the decision appealed from is set aside, and the petition for the adoption of the subject minor, granted. No pronouncement as to costs.

SC Case IN THE MATTER OF THE ADOPTION OF THE MINOR, EDWIN VILLA Y MENDOZA, LUIS E. SANTOS, JR. and EDIPOLA V. SANTOS, petitioners-appellants,

Tags Alcantara Alcoy moral damages Alegria actual damages Aloguinsan Argao Asturias Badian Balamban Bantayan Barili Boljoon Borbon Carmen Catmon Compostela Consolacion Cordova Daanbantayan Dumaguete Bais Sibulan Tampi Bacong Negros Bacolod Separation pay Resign Resignation Back wages Backwages Length of service pay benefit employee employer relationship Silay Kabankalan Daan Bantayan Dalaguete Dumanjug Ginatilan Liloan compensatory damages Madridejos Malabuyoc Medellin Minglanilla Moalboal Oslob Pilar Pinamungajan Poro Ronda Samboan San Fernando San Francisco San Remigio Sante Fe Santander Sibonga Sogod Tabogon Tabuelan Tuburan attorney’s fees Tudela exemplary damages Camotes General Luna Siargao Cagayan Davao Kidapawan Attorney Abogado Lawyer Architect Real Estate Broker nominal damages Sales Agent Properties for Sale Looking for Buyers Design Build House and Lot for Sale for Rent Talisay City Mandaue City Lapu Lapu Lapu-Lapu City Yncierto Sesante Villanueva Ruz Jan Edmond Marc Tim Timothy temperate damages Luz liquidated damages Kristin tct transfer certificate of title tax declaration birth certificate relocation survey surveying judicial titling administrative titling patent title denr cenro foreshore lease ecc environmental compliance certificate design build architect cebu engineer interior design designer residential commercial cebu property warehouse for rent for lease marc Christian yncierto ruz jan Edmond yncierto ruz Kristin Villanueva ruz Edmond mabalot ruz marriage certificate timber land forest land watershed agricultural lot land use conversion hearing trial illegal drugs trial lawyer business corporate lawyer labor lawyer immigration law bureau of immigration cebu 9g visa search warrant warrant of arrest motion to quash information complaint police officers buy bust physical suffering shocked horrified mental anguish fright serious anxiety besmirched reputation sleepless nights wounded feelings moral shock social humiliation similar injuries

When is the payment of damages as well as attorney’s fees proper?

In a Supreme Court case, the following damages were awarded:

“xxx

The RTC awarded moral damages, exemplary damages, attorney’s fees, plus P2,000.00 for every appearance, and costs of litigation.

.
Moral damages are meant to compensate the claimant for any physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injuries unjustly caused. Petitioner Rosalina has adequately established the factual basis for the award of moral damages when she testified that she felt shocked and horrified upon knowing of the foreclosure sale.

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However, we find the RTC’s award of P2,000,000.00 excessive and unconscionable, and reduce the salve to P100,000.00.
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Exemplary damages are imposed by way of example for the public good, in addition to moral, temperate, liquidated or compensatory damages. We reduce the RTC’s award of P500,000.00 to P30,000.00.
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Attorneys fees are allowed when exemplary damages are awarded and when the party to a suit is compelled to incur expenses to protect his interest. We find the RTC’s award of attorney’s fees in the amount of P100,000.00 proper.

xxx”

From the case of SPOUSES GILDARDO LOQUELLANO and ROSALINA JULIET B. LOQUELLANO, petitioners, xxx

Alcantara Alcoy moral damages Alegria actual damages Aloguinsan Argao Asturias Badian Balamban Bantayan Barili Boljoon Borbon Carmen Catmon Compostela Consolacion Cordova Daanbantayan Dumaguete Bais Sibulan Tampi Bacong Negros Bacolod Separation pay Resign Resignation Back wages Backwages Length of service pay benefit employee employer relationship Silay Kabankalan Daan Bantayan Dalaguete Dumanjug Ginatilan Liloan compensatory damages Madridejos Malabuyoc Medellin Minglanilla Moalboal Oslob Pilar Pinamungajan Poro Ronda Samboan San Fernando San Francisco San Remigio Sante Fe Santander Sibonga Sogod Tabogon Tabuelan Tuburan attorney’s fees Tudela exemplary damages Camotes General Luna Siargao Cagayan Davao Kidapawan Attorney Abogado Lawyer Architect Real Estate Broker nominal damages Sales Agent Properties for Sale Looking for Buyers Design Build House and Lot for Sale for Rent Talisay City Mandaue City Lapu Lapu Lapu-Lapu City Yncierto Sesante Villanueva Ruz Jan Edmond Marc Tim Timothy temperate damages Luz liquidated damages Kristin tct transfer certificate of title tax declaration birth certificate relocation survey surveying judicial titling administrative titling patent title denr cenro foreshore lease ecc environmental compliance certificate design build architect cebu engineer interior design designer residential commercial cebu property warehouse for rent for lease marc Christian yncierto ruz jan Edmond yncierto ruz Kristin Villanueva ruz Edmond mabalot ruz marriage certificate timber land forest land watershed agricultural lot land use conversion hearing trial illegal drugs trial lawyer business corporate lawyer labor lawyer immigration law bureau of immigration cebu 9g visa search warrant warrant of arrest motion to quash information complaint police officers buy bust physical suffering shocked horrified mental anguish fright serious anxiety besmirched reputation sleepless nights wounded feelings moral shock social humiliation similar injuries