G.R. No. L-24116-17 August 22, 1968
CEBU PORTLAND CEMENT COMPANY, plaintiff-appellant, vs. MUNICIPALITY OF NAGA, CEBU, ET AL., defendants-appellees.
FACTS
The plaintiff-appellant, Cebu Portland Cement Company, filed two separate actions challenging the validity of the distraint and subsequent public auction sale by the defendant-appellee, Municipality of Naga, Cebu, of 100,000 bags of its cement. The municipality sought to satisfy the plaintiff’s alleged deficiency in municipal license tax for 1960, the tax for 1961, and a penalty, totaling P204,300.00. The municipal treasurer, after repeated unsuccessful demands for payment, sent a letter on June 26, 1961, giving the plaintiff a ten-day period from receipt to settle the account. On July 6, 1961, the treasurer notified the plaintiff’s plant manager of the distraint of the 100,000 bags of cement. A notice of sale was posted for July 27, 1961, but the sale did not occur on that date. The auction sale was ultimately held on January 30, 1962. The lower court rendered a joint decision sustaining the validity of the municipality’s actions.
ISSUE
1. Whether the distraint of the property on July 6, 1961, was valid despite the ten-day grace period given in the June 26, 1961 letter not having fully lapsed.
2. Whether the auction sale held on January 30, 1962, was valid, considering the requirements for notice and the date of sale.
RULING
The Supreme Court affirmed the lower court’s decision in toto.
1. On the validity of the distraint: The Court held the distraint was valid. Under Section 2304 of the Revised Administrative Code, the municipal treasurer may seize and distrain property upon the failure of the taxpayer to pay the tax “at the time required.” The plaintiff had failed to pay the tax when it was due. The explicit language of the law governs, and the terms of the treasurer’s letter could not amend the statutory provision. Where the law is clear, there is no room for interpretation, only application.
2. On the validity of the auction sale: The Court held the sale was valid. The plaintiff argued the sale violated Section 2305 of the Revised Administrative Code, which requires the sale to be not less than twenty days after notice. The Court found substantial compliance, as more than twenty days had elapsed from the initial notice of distraint on July 6, 1961, to the sale on January 30, 1962. The delay was due to the plaintiff’s own requests for deferment. Furthermore, the lower court found as a fact that the notice of sale issued on January 19, 1962, specified January 30, 1962, as the date, and the sale was conducted on that date. In a direct appeal, the plaintiff is deemed to have accepted the lower court’s factual findings as conclusive, only questions of law being reviewable.