G.R. No. 203353, February 14, 2023
Universal Robina Corporation, Petitioner, vs. Department of Trade and Industry (“DTI”), The DTI Secretary, Zenaida C. Maglaya, in her capacity as DTI Undersecretary, and Victorio Mario A. Dimagiba, in his capacity as Director for DTI’s Bureau of Trade Regulations and Consumer Protection, Respondents.

FACTS

Petitioner Universal Robina Corporation filed a Petition for Declaratory Relief under Rule 63 of the Rules of Court to challenge the constitutionality or validity of Republic Act No. 7581 (Price Act), Executive Order No. 913, and DTI Administrative Order No. 7. The petitioner received a letter dated May 25, 2010, from respondent Victorio Mario A. Dimagiba, Director of the DTI’s Bureau of Trade Regulation and Consumer Protection, regarding the petitioner’s flour prices covering the period of a state of calamity. The letter stated that the petitioner’s act of increasing its prices constituted prima facie evidence of profiteering under the Price Act. The petitioner asserted that this communication from the DTI constituted a threat of enforcement and prosecution under the challenged law, thereby creating a justiciable controversy.

ISSUE

1. Whether a petition for declaratory relief is a proper remedy to challenge the constitutionality or validity of a law, regulation, or ordinance before there has been a breach thereof.
2. Whether Section 5(2) of the Price Act, defining the crime of “profiteering,” is void on the ground of vagueness.

RULING

1. On the Propriety of Declaratory Relief: The concurring and dissenting opinion agrees with the majority that a petition for declaratory relief under Rule 63 is a correct remedy to challenge the constitutionality or validity of a law, regulation, or executive order before a breach occurs. The opinion clarifies that such a petition is proper when the petitioner shows a justiciable controversy or a contrariety of legal rights, and that litigation is imminent or inevitable. The opinion states that prior decisions holding declaratory relief as an improper remedy for pre-breach constitutional challenges should be abandoned. It further holds that a petition for declaratory relief against a statute with a penal clause may prosper when prosecution has been threatened by the government, even without pending charges, provided there is a real threat of enforcement. The opinion finds that Universal Robina established an actual case or controversy because the DTI, through its Director, threatened enforcement of the Price Act’s profiteering provision via the May 25, 2010 letter.
2. On the Vagueness of the Profiteering Provision: The concurring and dissenting opinion disagrees with the majority and holds that Section 5(2) of the Price Act is void for vagueness. The opinion states that the law fails to provide ascertainable standards for determining what constitutes an “unreasonable” increase in price or “unreasonably high” profit, leaving law enforcement without a definitive guideline and individuals without fair notice of prohibited conduct. This lack of precise standards violates due process. The opinion rejects the argument that the provision’s vagueness can be cured by impliedly reading the factors from the law’s implementing rules into the statute itself, as this would constitute an invalid judicial legislation. It concludes that the vagueness of the profiteering provision renders it unconstitutional.