In 1960, Caltex (Philippines), Inc. announced its Caltex Hooded Pump Contest. The mechanics of the contest were as follows:
1. Participants must estimate the actual number of liters a hooded gas pump at each Caltex station will dispense during a specified period;
2. Contest is open to all car owners or licensed drivers;
3. Participants need not buy any Caltex products to be eligible. No fee is required.
4. Participants just need to fill out a form and drop their entries at the nearest Caltex station.
To publicize their contest, Caltex sought the assistance of the Philippine Postal Office. However, then acting Postmaster Enrico Palomar denied the request of Caltex as Palomar deemed that the contest is a violation of the Postal Law (Chapter 52 of the Revised Administrative Code [RAC]).
Palomar cited Section 1954 of the RAC:
SECTION 1954. Absolutely non-mailable matter. No matter belonging to any of the following classes, whether sealed as first-class matter or not, shall be imported into the Philippines through the mails, or to be deposited in or carried by the mails of the Philippines, or be delivered to its addressee by any officer or employee of the Bureau of Posts:
Written or printed matter in any form advertising, describing, or in any manner pertaining to, or conveying or purporting to convey any information concerning any lottery, gift enterprise, or similar scheme depending in whole or in part upon lot or chance, or any scheme, device, or enterprise for obtaining any money or property of any kind by means of false or fraudulent pretenses, representations, or promises.
According to Palomar, the contest is a lottery hence, communications pertaining thereto cannot be mailed by Caltex via Philippine Post.
Feeling aggrieved, Caltex brought the issue before the regular courts thru a petition for declaratory relief. Caltex argued that their contest is not a lottery; that under prevailing jurisprudence, lottery consists of the following elements:
a. consideration;
b. prize;
c. chance.
Caltex insists that their contest is not a lottery because the first element, consideration, is missing. Said element is missing because participants are not required to pay anything – there’s no consideration on the part of the participants.
Palomar assailed the petition as he argued that the same is not proper. He insisted that he was merely applying the law and that there is no legal issue at all; that there is no need for the courts to call for a construction on the statute in question. Palomar further argued that even if the said contest, assuming arguendo, is not considered a lottery, the same is considered as a gift enterprise which is still prohibited by the Postal Law to be mailed.
ISSUES:
1. Whether or not Caltex’s petition for declaratory relief is proper.
2. Whether or not the Caltex contest is a lottery/gift enterprise.
HELD:
1. Yes. The petition is proper. Construction of a law is in order if what is in issue is an inquiry into the intended meaning of the words used in a certain law. As defined in Black’s Law Dictionary: Construction is the art or process of discovering and expounding the meaning and intention of the authors of the law with respect to its application to a given case, where that intention is rendered doubtful, amongst others, by reason of the fact that the given case is not explicitly provided for in the law.
2. No.
The contest is not a lottery. The contention of Caltex is well taken, i.e., the first element is lacking (no consideration).
The contest is also not a gift enterprise. The Supreme Court went on to discuss that under prevailing jurisprudence and legal doctrines as well as definitions provided by legal luminaries, there is no explicit definition as to what a gift enterprise is. However, under the Postal Law, the term “gift enterprise” was used in association with the term “lottery”. As such, the principle of noscitur a sociis, a principle in statutory construction, is applicable. Under this principle, it is only logical that the term under a construction should be accorded no other meaning than that which is consistent with the nature of the word associated therewith. Hence, applying noscitur a sociis, if lottery is prohibited only if it involves a consideration, so also must the term “gift enterprise” be so construed. Therefore, since the contest does not include a consideration, it is neither a lottery nor a gift enterprise. Caltex should be allowed to avail of the Philippine postal service.
