G.R. No. L-5876 - People vs. Chu Chi

On July 18, at around 11:30 a.m., Felipe Umlas entered the defendant-appellant Chu Chi’s store located at 305 Azcarraga, Tondo, to purchase a fresh duck’s egg.
Umlas transacted with Chu Chi by paying P1.00 and receiving P0.80 in change after buying the egg for P0.20.
The sale was documented when Umlas, upon exiting the store, was questioned by Josue del Rosario of the Manila Police Department’s price control unit about the price paid.

Del Rosario entered the store following Umlas and, upon inquiry, Umlas indicated that Chu Chi was the seller.
When questioned inside the store, Chu Chi admitted that he sold the egg for P0.20, despite the existing ceiling price of P0.15 as evidenced by the price list under Executive Order No. 331.
Both Umlas and Chu Chi were taken to the police station, where they signed a statement (Exhibit A) confirming that the egg was sold to Umlas for P0.20 at 11:50 a.m.

At trial, Chu Chi denied personally selling the egg, attributing the sale to one of his salesgirls, Nieves Boado.
He further claimed that he was in the kitchen at the time the sale was made, contrary to the direct observation by the policeman and the identification by Umlas.
The trial court did not give any weight or credit to his denial due to the clear and corroborative evidence against him.

The case relates to the violation of Executive Order No. 331, in connection with Republic Act No. 509, which set the ceiling price for goods such as duck’s eggs.
Under Republic Act No. 509, any person found selling an article in excess of the fixed ceiling price could be fined (with potential subsidiary imprisonment in the event of insolvency) and face ancillary penalties such as business license cancellation and, in the case of aliens, deportation.
The evidence pointed to Chu Chi selling at P0.20 instead of the mandated P0.15, constituting a violation of the law.

The trial court of Manila found Chu Chi guilty, imposing a fine of P5,000 or the corresponding subsidiary imprisonment, ordering the cancellation of his license, barring him from business for five years, and recommending deportation given his status as a Chinese alien.
The case was appealed to the Court of Appeals; however, since the appellant raised the issue of the constitutionality of Republic Act No. 509, the Court of Appeals certified the appeal to the Supreme Court for a final determination as provided by existing law.

Whether the trial court erred in not giving due weight and credit to Chu Chi’s testimony denying his active participation in the sale, and instead relying solely on the testimony of Felipe Umlas and other corroborative evidence.
Whether the consistency and timing of Umlas’s identification, along with Chu Chi’s own admission to the policeman and subsequent signing of the statement (Exhibit A), sufficiently impeached his conflicting denial.

Whether RA No. 509, which imposes the fine range of P2,000 to P10,000 for selling articles above the prescribed ceiling price, is unconstitutional on the ground that it imposes an excessive penalty.
Whether the reduction of the trial court’s imposed penalty (from P5,000 to P2,000) as seen in People vs. De la Cruz provides a valid basis for upholding the law under the constitutional test of proportionality and fairness.