Case Summary (G.R. No. 6791)
Petitioner
The People of the Philippines, prosecuting violation of Central Bank Circular No. 20.
Respondent
Que Po Lay, charged with failing to sell foreign exchange to the Central Bank within one day as required.
Key Dates
• Issuance of Circular No. 20: 1949
• Conviction of appellant: early 1951 (approx.)
• Publication of Circular No. 20 in Official Gazette: November 1951
• Decision of Supreme Court: March 29, 1954
Applicable Law
• 1935 Philippine Constitution (then in force)
• Republic Act No. 265, § 34 (Foreign Exchange Regulation)
• Central Bank Circular No. 20 (1949)
• Commonwealth Act No. 638 and Act No. 2930 (Official Gazette publication requirements)
• Revised Administrative Code, § 11 (effectivity of statutes)
• Civil Code (Republic Act No. 386), Art. 2 (effectivity of laws)
• Spanish Civil Code of 1889, Art. V (promulgation and effectivity)
Background and Trial Court Holding
Que Po Lay was found in possession of approximately US $7,000 in currency, checks, and money orders. Under Circular No. 20 (implementing R.A. 265, § 34), he was required to sell such foreign exchange to the Central Bank’s agents within one day. The trial court convicted him for non‐compliance, imposing six months’ imprisonment, a ₱1,000 fine (with subsidiary imprisonment), and costs.
Issue on Appeal
Whether Central Bank Circular No. 20—an order prescribing penalties—had binding force and effect at the time of appellant’s alleged violation, given its non-publication in the Official Gazette until after conviction.
Publication Requirements under Philippine Law
Commonwealth Act No. 638 and Act No. 2930 list instruments mandated for Gazette publication (laws, court decisions, resolutions, notices). They do not expressly require publication of administrative circulars for effectiveness. By contrast, § 11 of the Revised Administrative Code and Art. 2 of the Civil Code (R.A. 386) provide that statutes take effect fifteen days after Gazette publication, absent special provision. Jurisprudence treats circulars issued under statutory authority as having the force of law, but their penal provisions generally must be published before they bind the public.
Analysis of Effectivity of Circular No. 20
• Circular No. 20, though not a statute, was issued under statutory authority and carried penal sanctions.
• Analogous provisions in the Spanish Civil Code and commentary by Manresa interpret “laws” to include regulations, decrees, and circulars, all of which require Gazette publication to take effect.
• Circular No. 20 was not published until November 1951—three months after appellant’s conviction—so its penal clause was not binding at the time of the alleged offense.
Jurisdictional Consequence of Non-Publ
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Facts
- Que Po Lay was found in possession of foreign exchange consisting of U.S. dollars, U.S. checks, and U.S. money orders amounting to approximately $7,000.
- Central Bank Circular No. 20, issued pursuant to section 34 of Republic Act No. 265, required any person receiving foreign exchange to sell it to the Central Bank or its agents within one day of receipt.
- The appellant failed to comply with Circular No. 20’s one-day resale requirement.
Procedural History
- The Court of First Instance of Manila convicted Que Po Lay for violating Central Bank Circular No. 20 in connection with section 34 of R.A. 265.
- He was sentenced to six months’ imprisonment, a fine of ₱1,000 (with subsidiary imprisonment in case of insolvency), and the costs of suit.
- Que Po Lay appealed to the Supreme Court of the Philippines.
Issue
- Whether Central Bank Circular No. 20 had the force and effect of law prior to its publication in the Official Gazette, and thus whether its violation could constitutionally support a criminal conviction.
Contentions of the Appellant
- Circular No. 20 was not published in the Official Gazette before the alleged offense.
- Commonwealth Act No. 638 and Act No. 2930 mandate publication in the Official Gazette of “orders or notices of general applicability” to become effective.
- Without publication, Circular No. 20 lacked legal force and could not impose a penalty.
Government’s Response
- The Solicitor