Molina Vs Rafferty

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PHILIPPINEREPORTSANNOTATEDVOLUME037
[No. 11988. February 1, 1918. ]

JACINTO MOLINA, plaintiff and appellee, vs. JAMES J.
RAFFERTY, as Collector of Internal Revenue, defendant
and appellant.
1. TAXATION "MERCHANT" DEFINED."Merchant," as
used in the Internal Revenue Law, "means a person
engaged in the sale, barter, or exchange of personal
property of whatever character." (Act No. 2339, sec. 40
Administrative Code [1917], sec. 1459.) Under this law,
buying and selling are not essential to constitute one a
merchant to sell only is sufficient.
2. ID. ID. SELLER OF FISH.A person engaged in the
sale of fish is a merchant.
3. ID. "AGRICULTURE" DEFINED."Agriculture" is the
art or science of cultivating the ground, including the
preparation of the soil, the planting of seeds, the raising
and harvesting of crops, and the rearing, feeding, and
management of live stock.
4. ID. "AGRICULTURE" DISTINGUISHED.Agriculture is
but one pursuit. Agriculture, and what it includes, is
distinguished from other occupations or professions, as
manufacturing and fishing. In the Philippines, agriculture
and fishing are separate and distinct pursuits.
5. ID. "AGRICULTURAL PRODUCTS" DEFINED."The
common parlance of the country, and the common practice
of the country have been
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1
On the 31st of August, 1917, the following judgment was rendered:
"After a careful consideration of the record on this appeal, and for the purpose
of notifying the parties as soon as possible of our decision, we hereby order
without prejudice to rendering later a more extended decisionthat judgment be
entered by reversing the judgment of the trial court and absolving the defendant
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from the complaint, with the costs of the first instance against the plaintiff and
without special findings with respect to those of this second instance.
"Twenty days after the notification of this decision, let judgment be entered in
accordance herewith, and ten days thereafter let the record be remanded to the
court of origin, So ordered,
(Sgd.) "A. C. CARSON,
"MANUEL ARAULLO,
"THOMAS A. STREET,
"GEO. A. MALCOLM.
"I dissent.
(Sgd.) "E. FlNLEY JOHNSON.
"I dissent.
(Sgd.) "C. S. ARELLANO.
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PHILIPPINE REPORTS ANNOTATED

Molina vs. Rafferty.
to consider all those things as farming products or

agricultural products which had the situs of their
production upon the farm, and which were brought into
condition for the uses of society by the labor of those
engaged in agricultural pursuits, as contradistinguished
from manufacturing or other industrial pursuits." (District
of Columbia vs. Oyster [1885], 54 Am. Rep., 275.) The
term "agricultural products" has been held to include
swine, horses, meat, cattle, sheep, manure, cord wood,
hay, poultry, vegetables, fruit, eggs, milk, butter, and lard
but not fish.
6. ID. ID.Fish are not an agricultural product.
7. ID. EXEMPTIONS.The purpose of the Legislature in
exempting agricultural products from taxation under the
Internal Revenue Law was to encourage farming and not
fishing. A merchant engaged in the sale of fish is not
entitled to the exemption granted to agricultural products.
8. ID. UNIFORMITY.The Internal Revenue Law in
imposing a tax on merchants is uniform for all of a class,
and so valid.
9. STATUTORY CONSTRUCTION CARDINAL RULE.
"As men whose intentions require no concealment
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generally employ the words which most directly and aptly

express the ideas they intend to convey, the enlightened
patriots who framed our Constitution, and the people who
adopted it, must be understood to have employed words in
their natural sense, and to have intended what they have
said." (Marshall, G. J., in the historic case of Gibbons vs.
Ogden [1824], 9 Wheat., 1.)
10. ID. OPINION OF EXECUTIVE OFFICIALS.Courts
will and should respect the contemporaneous construction
placed upon a statute by the executive officers, whose duty
it is to enforce it, and unless such interpretation is clearly
erroneous will ordinarily be controlled thereby.
11. ID. EXEMPTION FROM TAXATION.When exemption
from taxation is claimed, it must be shown indubitably to
exist. The presumption is always against any surrender of
the taxing power.
APPEAL from a judgment of the Court of First Instance of

Manila. Abreu, J.
The facts are stated in the opinion of the court.
AttorneyGeneral Avencea for appellant.
Mariano Escueta for appellee.
MALCOLM, J.:
This appeal presents for resolution the question of whether
or not fish are an agricultural product.
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VOL. 37, FEBRUARY 1, 1918
547
FACTS.
The facts are not in dispute. Plaintiff is the owner of
various fish ponds (pesqueras) in the municipality of
Bulacan, Province of Bulacan. Between January 1 and
September 30, 1915, plaintiff consigned to a commission
merchant in Manila quantities of fish which sold for
P5,264.89. The commission merchant paid the merchant's
percentage and fixed taxes due under the Internal Revenue
Law. Plaintiff, however, had not previously paid the
merchant's tax, although from August 1, 1904, the date
when the first Internal Revenue Law became effective,
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until October 26, 1915, plaintiff had been engaged in this

business, Plaintiff had paid the real estate tax on the land
upon which the fishponds are located. On the date last
mentioned, on demand of a representative of the Bureau of
Internal Revenue, plaintiff paid under protest P71.81, the
total internalrevenue tax on the gross sum received for the
first threequarters of the year 1915. The ground of the
protest was that plaintiff is an agriculturist and not a
merchant and therefore exempt from the taxes imposed by
the Internal Revenue Law upon the gross sales of
merchants. The protest was denied by the Collector of
Internal Revenue, who held that the plaintiff was a
merchant. Suit to recover this amount of P71.81 was
thereupon instituted in the Court of First Instance of the
city of Manila against the defendant as collector of internal
revenue. After trial on an agreed statement of facts, the
Honorable Jose Abreu in a carefully prepared decision
ordered defendant to refund the P71.81 paid by plaintiff as
internalrevenue taxes and penalties under protest, with
legal interest thereon from November 26, 1915, the date of
such payment under protest, Defendant appealed making
four assignments of error, all of which, however, with the
exception of the last, which need not be considered, center
around the question which we set out in the beginning of
this decision. Both appellee and appellant have further
favored the court with an exceptionally able presentation of
their respective contentions. We are given to understand
that this
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is in the nature of a test case, concerning not alone the

comparatively small amount involved but affecting the
taxes of numerous other persons in an amount which will
run up into thousands of pesos.
In addition to the foregoing statement of the case, we
must note the nature of the fishponds and of the fish. As to
the first, before the lands are suitable for use as fishponds,
it is necessary for the land to be prepared by the erection of
dykes and cleaning out and deepening the bottom. The
presence of caretakers is necessary to see that the
fishponds do not become damaged and to regulate the
entrance and exit of water through the floodgates. The fish
are of the species known bagus. These fish are obtained
from small fishes (semillas), which are placed in the
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fishponds. These small fishes are first put in a,

comparatively small compartment, surrounded by walls of
earth, which is found within the fishery itself. Afterwards
when they get to be about the size of a cigarette, they are
let loose into the other compartments of the same fishery.
This compartment for semillas is allowed to dry and is
cleaned well before the semillas are placed therein it is
even plowed to kill all the bugs that may eat up the fish. In
order to make marine plants grow, a small amount of sea
water is allowed to enter. When the fish have become large
an endeavor is made to fill the fishery with water. From
time to time the water contained in the fishery is renewed
to avoid the killing of the fish. The walls of a fishery are
constructed to preserve and to retain the water and the
fishes inside the fishery, These walls are constructed on
swampy lands and in some cases on rice fields bounded by
a river or the sea.
The food of the bagus includes marine plants. These
alg are of seven classes, their scientific names being
cladophora, chaetomorpha, oscillatoria, dogonium,
lyngbya, enteromorpha, and najas. One of these plants is
rooted. Some of the others are very loosely attached to the
ground, but not rooted. Generally the alg float in the
water.
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Molina vs. Rafferty
LAW.
The provisions of the law which it is necessary to construe
are not extensive. The diff ferent internalrevenue laws
have provided for a merchant's tax. "Merchant," as used in
the law, "means a person engaged in the sale, barter, or
exchange of personal property of whatever character." (Act
No. 2339, sec. 40 Administrative Code [1917] sec. 1459.)
The succeeding section (Act No. 2339, sec. 41
Administrative Code [1917], sec. 1460) is entitled "Sales
not subject to merchant's tax." The section provides:
"In computing the tax above imposed transactions in the following
commodities shall be excluded: * * *.
"(c) Agricultural products when sold by the producer or owner
of the land where grown, whether in their original state or not."
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With the facts and the law before us, we return to the
question first suggested.
QUESTION.
Are fish an agricultural product within the meaning of the
exemption provisions of the Internal Revenue Law?
OPINION.
Different methods of approach to this question are possible.
For example, all argument could be disposed of
peremptorily with the bald statement that in accordance
with the rule of stare decisis, the decision of this court in
The United States vs. Laxa ([1917], 36 Phil. Rep., 670) is
decisive. Justice Araullo, in his opinion, held that fish are
not an agricultural product, that the owner of a fishpond
who sells the fish at the fishpond is a merchant, that such a
merchant is not entitled to the exemption provided by the
Internal Revenue Law, and that the said owner is guilty of
violation of the Internal Revenue Law. We pref fer not to
take such a stand, although we are confident that it could
be defended, because of the vigorous objection to a decision
in
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a criminal prosecution becoming a precedent in a civil

action for the recovery of taxes.
As opposed to the Laxa decision, counsel for plaintiff
invites special attention to the cases of Mapa vs. Insular
Government ([1908] 10 Phil., 175) and Mercado vs.
Collector of Internal Revenue ([1915] 32 Phil. Rep., 271). In
the first case, the Supreme Court said
"The question before us is not what is agricultural land, but what
definition has been given to that phrase by the Act of Congress."
The Philippine Bill, it was found, classified land as

agricultural public land in order to distinguish such land
from timber or mineral land. Neither Congress nor the
court gave any definition of agricultural land as such or of
the products of the land. Moreover, the court made the
observation that, "The land in question in this case, which
is used as a fishery, could be filled up and any kind of crops
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raised thereon." If the case can be considered as an

authority, it must be that the court recognizes that
agricultural land, as the term is used in the Act of
Congress, may be devoted to other than agricultural
purposes, and that using agricultural land for a fishpond is
a use other than agricultural. In the second case of
Mercado vs. Collector of Internal Revenue, following Mapa
vs. Insular Government (supra), the Court said
"It is, then, unquestionable that bakawan firewood is an
agricultural product, differing from other kinds of firewood
obtained from forest trees because the bakawan plant grows only
on lands subject to overflow, which require clearing and care by
workers skilled in agricultural pursuits, in order that it may
thrive. It is also to be noted that up to the present time mangrove
swamps have been found suitable for no other useful crop."
But it is plainly a far cry from a holding that bakawan,

planted and grown through the culture of the soil, is an
agricultural product, to finding that fish are in a similar
sense planted and grown as a result of the culture of the
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soil. Whatever comfort can be derived from these decisions

as persuasive authority is more than nullified by the later
case of The United States vs. Laxa ([1917] 36 Phil. Rep.,
670)."
Just, therefore, as the facts and the law are
indisputable, so do we prefer to forget these three cases for
the time being and to rest our decision on the plain and
ordinary meaning of the law as disclosed by the elementary
rules of statutory construction.
And first, in order to dispose of the question, is the
owner of a fishpond, such as the plaintiff, who sells fish
taken from a fishpond, a ' merchant" as defined in the
Internal Revenue Law? Recalling this definition of a
"merchant," it would appear undeniable that the plaintiff is
properly included in such classification. To paraphrase the
law, he is a person engaged in the sale of fish. Under our
law, whatever may be the usual conception of a merchant,
buying and selling are not essential to sell only is
sufficient. (See also In re Cameron Town Mut. Fire,
Lightning & Windstorm Ins. Co. [1899], 96 Fed., 756.)
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If such a man is a merchant, does his sale of fish place

him under the exemption of the Internal Revenue Law? We
know the meaning of "fish." In the authoritative work by
Dr. C. L. G. Gunther on the Study of Fishes, we find the
following:
"According to the views generally adopted at present, all those
vertebrate animals are referred to the class of fishes, which, living
in water, breathe air dissolved in water by means of gills or
branchiae whose heart consists of a single ventricle and single
atrium whose limbs, if present, are modified into fins,
supplemented by unpaired, median fins and whose skin is either
naked, or covered with scales or osseous plates or bucklers * * *."
We then have left to define merely the words "agricultural

products."
"Agriculture" is defined by Webster as "the art or science
of cultivating the ground, including the prepa
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ration of the soil, the planting of seeds, the raising and

harvesting of crops, and the rearing, feeding, and
management of live stock." Let us test our facts by this
definition. The ground of the fishpond is cultivated. The
soil is prepared. We, however, greatly doubt that seeds (of
fish) are planted or that crops (of fish) are raised and
harvested. Certainly, the seeds of fish are not sown in the
ground as one would sow corn, while as distinguished from
the rearing, feeding, and management of live stock, which
consumes the products of the farm, the fish living in water
depending upon water for life, only receive nourishment
from marine plants most of which have little or no
connection with the land.
To proceed. The equivalent of "agriculture" in
"husbandry." And "husbandry" is defined by Webster as
"the business of a farmer, comprehending agriculture or
tillage of the ground, the raising, managing, and fattening
of cattle and other domestic animals, the management of
the dairy and whatever the land produces." Again, we are
far from confident that a farmer is generally understood to
be a fisherman, and that the land can be said to produce
fish. In a case in which these definitions were considered,
the supreme court of Tennessee said that "agriculture"
means "in its original sense, the cultivation of the ground
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for the purpose of procuring vegetables and fruits for the

use of man and beast, or the act of preparing the soil,
sowing and planting seeds, dressing the plants, and
removing the crops. In this sense the word includes
gardening or horticulture, and also the raising and feeding
of cattle or stock but in a more common and appropriate
sense is used to signify that specie of cultivation which is
intended to raise grain and other field crops for man and
beast." (Simons vs. Lovell [1872], 54 Tenn. [7 Heisk.], 510
see also In re Drake [1902], 114 Fed., 229.)
To proceed. "Agricultural products," the supreme court
of Georgia has held, "in ordinary usage," is confined to the
yield of the soil, as corn, wheat, rye, hay, etc. (Davis & Co.
vs. Mayor and Council of Macon [1879], 64 Ga., 128.)
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Molina vs. Rafferty
The court had here to determine if beef cattle were exempt

from taxation as "an agricultural product." The court asked
"And hen it is thought of closely, would it not be rather

an unusual application of the phrase 'agricultural products'
to make it comprehend beef cattle? In ordinary usage, is
not that phrase confined to the yield of the soil, as corn,
wheat, rye, oats, hay, etc., in its primary form? When there
has been conversion of the fruits of the soil into animal
tissues are we still to apply the phrase ? And suppose we
are to disregard the change in its first stage, and call a cow
or a steer an agricultural product, must we carry the name
forward to the steak or roast which the butcher sells us
from the slaughtered animal? If cattle fall under the
denomination, so do hogs and if beef, so does bacon." (See
also State vs. Patterson [1887], 4 S. E., 47.)
Another cases coming from the supreme court of the
District of Columbia, gives a much broader meaning to the
phrase. (District of Columbia vs. Oyster [1885], 54 Am.
Rep., 275.) The court said
"The common parlance of the country, and the common
practice of. the country, have been to consider all those
things as farming products or agricultural products which
had the situs of their production upon the f arm, and which
were brought into condition for the uses of society by the
labor of those engaged in agricultural pursuits, as
contradistinguished from manufacturing or other
industrial pursuits. The product of the dairy or the product
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of the poultry yard, while it does not come directly out of

the soil, is necessarily connected with the soil and with
those who are engaged in the culture of the soil It is, in
every sense of the word, a part of the farm product. It is
depended upon and looked upon as one of the results and
one of the means of income of the farm, and in a just sense,
therefore, it may be considered produce."
To indicate further the wide sweep of the term
"agricultural products," and to show how such terminology
in
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fluences those who disagree with us, the term "agricultural

products" has been held to include swine, horses, meat
cattle, sheep, manure, cordwood, hay, poultry, vegetables,
fruit, eggs, milk, butter, and lard. (See Mayor vs. Davis, 6
W. & S., 279.) But never by any court to include fish.
Like everything else in the world, it must be that there
is a limit to the things which can be included in the term
"agricultural products." The District of Columbia case,
much relied upon by the plaintiff, gives the clue.
Agriculture is but one pursuit. Agriculture and what it
includes is contradistinguished from other occupations and
professions, as manufacturingand we believe, fishing.
Thus, of fisheries the Encyclopedia Britannica (p. 429) says
"For the most part the operations of fishing have been comparable
with those of primitive hunting rather than with agriculture."
Fisheries, while possibly in concomitance with the soil, are

even more certainly concerned with the water in which the
fish live and have their being. If fishing is farming, then
conversely farming must be fishing. Waiving all the
technical definitions, does the ordinary man when he
speaks of agriculture and farming think of a farmer as a
fisherman, and when he speaks of fisheries does he think of
a fisherman as a farmer?
One other word in the law, "grown" is necessarily
included and must be considered in finding the proper
meaning. The law provides that "agricultural products"
must be "grown." Again referring to Webster, "grown"
means "to cause to grow to cultivate to produce as, to
grow a crop to grow wheat, hops, or tobacco." The fish
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taken from the fishponds and sold are certainly not the
natural products of such land. They are retained therein by
the construction of artificial dykes. They are animals farae
nature. They have none of the characteristics of the natural
products of the soil. Fish are not "grown" as wheat, hops, or
tobacco are "grown."
The question as to whether or not a similar exemption in
favor of agriculturists contained in the Internal Rev
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enue Law of 1904 operated to exclude from the merchant's

tax, receipts from the sale of fish, arose shortly after the
passage of that Act. The AttorneyGeneral in an opinion
rendered on March 14, 1906 (3 Op. Atty. Gen., 65), held in
effect that the culture of the soil was the determining factor
in considering what products are or are not agricultural
products, As to quarrymen and fishermen, the Attorney
General observed
"The occupation of the lumberman and the stockman, in the
historical development of these industries, as well as in present
day practice, has never been confused with that of the
agriculturist while as to quarrymen and fishermen it may be
observed that tillers of the soil are not wont to plow the fields in
quest of rock or in anticipation of a crop of fishes or of pearls."
This opinion of the AttorneyGeneral was concurred in by

the then GovernorGeneral and Acting Secretary of
Finance and Justice, who had helped draft the law. The
Collector of Internal Revenue thereupon published the
opinion in full in Bureau of Internal Revenue Circular, No.
106. This official ruling of the executive officials is now
entitled to consideration by the courts." Courts will and
should respect the contemporaneous construction placed
upon a statute by the executive officers whose duty it is to
enforce it, and unless such interpretation is clearly
erroneous will ordinarily be controlled thereby. (In re Allen
[1903], 2 Phil., 630, following Pennoyer vs. McConnaughy
[1890], 140 U. S., 363 Government of Philippine Islands Ex
Rel. Municipality of Cardona vs. Municipality of
Binangonan [1916], 34 Phil. Rep., 518.)
We have thus far considered the etymology of the words,
We frankly admit to a slight doubt of exact interpretation
by this method. We, however, believe that viewed from the
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standpoint of the most elementary of all rules of statutory

construction there is but one possible result. In other
words, our sole duty is to ascertain and give effect to the
intention of the lawmaking body. We can best discover
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this intention through the medium of the action taken by

the Legislature in the enactment of other laws.
The first Internal Revenue Law (Act No. 1189) was
enacted by the Philippine Commission. It is plain that the
Commissioners must have had in mind agriculture as
known to them in the United States. The organization of
the American Government includes a "Department of
Agriculture," the "Bureau of Fisheries" is under the
Department of Commerce. Agriculture and Fishing are
therefore separate and distinct. In Great Britain there is a
"Board of Agriculture and Fisheries." Moreover, the same
Philippine Legislature which provided an exemption from
taxation for agricultural products was also interested in
establishing a Bureau of Agriculture. In enumerating the
functions of this Bureau, not one word is said of fish or
fisheries. We rather doubt if the experts in agronomy in the
Bureau .of Agriculture would 'consider themselves
competent to advise as to piscatology. On the contrary, you
find a section of fisheries established not in the Bureau of
Agriculture but in the Bureau of Science. Instead, also, you
find special laws unrelated to agriculture dealing with the
granting of fishery privileges. The purpose of the
Legislature in exempting agricultural products from
taxation under the Internal Revenue Law was to encourage
farming and not fishing. This court has heretofore held,
and we reiterate, that "where language is plain, subtle
refinements which tinge words so as to give them the color
of a particular judicial theory are not only unnecessary but
decidedly harmful." (Yangco vs. Court of First Instance of
Manila and Yangco [1915], 29 Phil., 183.) Chief Justice
Marshall in the historic case of Gibbons vs. Ogden, ([1824],
9 Wheat., 1) said:
"As men, whose intentions require no concealment, generally
employ the words which most directly and aptly express the ideas
they intend to convey, the enlightened patriots who framed our
Constitution, and the people who adopted it must be understood
to have employed words in
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557
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their natural sense, and to have intended what they have said."
The answers to our question. areA person engaged in the

sale of fish is a merchant. Fish are not an agricultural
product. This merchant is not entitled to exemption under
the Internal Revenue Law.
The further objection is made that the particular tax
would constitute double taxation. It is sufficient to note in
this respect that this court in Gil Hermanos vs. Hord
([1908] 10 Phil., 218) said:
"It is very apparent that the tax under discussion is not a tax
upon property. It is rather a tax upon the occupation or industry
in which a person is engaged."
The internalrevenue tax is also uniform for all of a class.

In opposition to such a contention, it could be advanced if
necessary that the burden is on plaintiff to establish that
the surrender of the taxing power is manifested by words
too plain to be mistaken. "When exemption is claimed, it
must be shown indubitably to exist." (Farrington vs.
Tennessee [1877], 95 U. S., 679, 686.) "The presumption is
always against any surrender of the taxing power."
(Tennessee vs. Whitworth [1885], 117 U. S., 129, 136.)
We have permitted our discussion of the question raised
by this appeal to proceed much farther than is really
necessary for the decision of the case. If we have fallen into
the mire of prolixity, it has been because we approached
the subject with a desire to accede, if possible, to the
request of the plaintiff. We are as much interested in
upholding legislation which will assist in the commercial
development of the Islands as any one. We cannot,
however, step outside the settled and ordinary meaning of
the law and by judicial legislation give to the law a
meaning not intended. If redress is proper, under these
circumstances, complainants must look to the Legislature
and not to the courts.
The judgment of the lower court is reversed and the
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defendant is absolved of the complaint, with the costs of the

first instance against the plaintiff, and without special
finding as to costs of this instance. So ordered.
Carson, Araullo, and Street, JJ., concur.
JOHNSON, J., with whom concurs ARELLANO, C. J.,
dissenting:
The only important question presented by this appeal is
whether or not the products of a "vivero de peces" should be
considered as an agricultural product and as such relieved
from the internalrevenue tax in accordance with
paragraph (c) of article 41 of Act No. 2339.
The Court of First Instance, in a very wellreasoned
opinion, held that said products were exempt from the
internalrevenue tax under said Act. This court, by a
majority opinion, held that said products were not exempt
from the payment of the internalrevenue tax and reversed
the judgment of the lower court.
We think the majority opinion misses both the spirit and
purposes of the law, and works a great injustice and a
severe hardship upon thousands of the inhabitants of the
Philippine Islands who are engaged in purely agricultural
pursuits. Said decision places a great burden upon those
who are least able to bear it. By reason of the very small
profits of the agriculturist, earned by the hardest of labor,
every intendment of the law should be, at least, liberally
construed in his favor.
Paragraph (c) of section 41 of Act No. 2339 provides that
the tax imposed under said law shall not be imposed upon
"agricultural products when sold by the producer or owner
of the land where grown, whether in their original state or
not." Under the interpretation given in the majority
opinion, the Collector of Internal Revenue may collect taxes
upon every grain of rice produced by the farmers of the
Philippine Islands, unless he sells the same "where grown."
Such an interpretation, in our opinion, was never '
intended by the lawmaker.
The majority opinion has fallen into error, in our
opinion, in not distinguishing a "pesquera" from a "vivero
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de peces." No contention is made that the products of a

"pesquera," as that terms is generally used, should be
relieved from the internalrevenue tax. Our contention is
simply that the products of a "vivero de peces" should be
relieved from the internalrevenue tax, upon the theory
that they are as much of an agricultural product as any
other product of the farm by reason of the method employed
in producing them. The majority opinion admits [that]
whether a particular product is or is not an agricultural
product depends upon the methods used in producing it.
A "pesquera," as distinguished from a "vivero de peces,"
may be defined as a specie of trap placed upon the farm in
which fish are caught from time to time. While a "vivero de
peces'" may be defined as a part of the farm set aside for
the raising or production of fish, the same as is done in the
production of corn, sugar cane, rice, bananas, coconuts,
ducks, chickens, eggs, milk, butter, lard, hay, wood, cattle,
horses, sheep, or any of the other great variety of products
produced by the farmers in the Philippine Islands, the only
difference being one of degree of care and labor necessary
for production.
The error which the majority opinion has fallen into may
be best illustrated by an example:
A is the owner of a farm. A portion of the same is dry
land capable of producing sugar cane, or corn, or other
varieties of farm products which can only be produced upon
dry land. A portion of said farm, by virtue of its location
with reference to water, sunlight, and air may be used for
the production of abaca, bananas, or some of the various
classes of fruits. Another portion of the farm is low land,
upon which rice or certain classes of vegetables only can be
produced profitably. Still another portion of the farm is
swamp land, covered by water and incapable of being
properly drained. Another portion of the farm is
mountainous so that it cannot be cultivated at all. Upon
the mountainous portion of said farm the owner raises
cattle, sheep, goats, horses, hogs, chickens,
560
560

turkeys, eggs, lard, butter, wool and hides. Another portion

of the farm can most profitably be devoted to the
production of bacauan which was held to be an agricultural
product. (Mercado vs. Collector of Internal Revenue, 32
Phil. Rep., 271.) The swamp land of his farm is of such a
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character that it can not profitably be devoted to the

production of rice or any of the cereals, and is too swampy
upon which to raise cattle, sheep, horses, goats, etc. The
farmer, therefore, utilizes that portion for the production of
geese, ducks, and other domestic fowls, as well as for the
production of eggs. There comes a time when the swamp
land ceases to be profitable for the production of rice as
well as for the production of said fowls and eggs. All of said
farm, including the various classes of land as above
described, is taxed as agricultural land and it is a matter
of common knowledge that the "vivero de peces" are taxed
as agricultural land, and equally as high, if not higher,
than other lands devoted to the production of rice, corn or
sugar cane, etc.
A great demand may arise for fish in the country. The
farmer, in order to reap the advantage of said demand,
ceases to produce eggs, or ducks, or geese upon the swamp
lands of his farm and turns the same into a "vivero de
peces." He, thus, wisely utilizing the different portions of
the f arm f or the production of all of the products which
farmers generally produce, is greatly increasing the wealth
of the State.
The majority opinion admits that domestic fowls
chickens, ducks, geese, turkeysand eggs, butter, lard,
milk, vegetables, fruit, etc., are agricultural products, but
argues that nothing is, or may be considered, an
agricultural product which does not result from a
cultivation of the soil. To admit that eggs, butter, lard and
milk are agricultural products, and to argue that nothing is
an agricultural product which does not result from a
cultivation of the soil, presents a consistency in argument
and conclusion which we are unable to understand. It is
admitted that the land for a "vivero de peces" is specially
561
561
prepared. A certain cultivation and preparation is

necessary for the creation of a "vivero de peces." It is
difficult to understand what special preparation of the soil
is necessary for the production of hen's eggs, butter, lard,
milk, or cattle, or sheep or horses or hogs, or goats which
makes those products agricultural products. It is a matter
of common knowledge that land may be specially prepared
for the production of rice this year and then changed into a
"vivero de peces" next year and vice versa. Under what
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interpretation of the law and under what definition of

agricultural products may we conclude that the year in
which the same parcel of land produces rice produces an
agricultural product while in the year it is producing fish is
not also producing an agricultural product? Of course, as
we stated above, a "vivero de peces" must not be confused
with a "pesquera" which is used as a trap for the purpose
of catching fish. No contention is made that the products of
the latter is in any sense an agricultural product any more
than the product of a trap placed in the fields for the
purpose of catching wild animals, which from time to time
pass upon the land, is an agricultural product.
It is admitted in the majority opinion that the land for a
"vivero de peces" must be specially prepared by first
building dykes and cultivating the land preparatory to the
planting of the fish. The only difference, therefore, between
the preparation of a "vivero de peces" and the preparation
of a rice paddy is one in extent of labor employed. In both
cases the land is specially prepared for the particular
purpose to which the farmer desires to deVOte it,
Forgetting for a moment the stereotyped and the
lexicographer's definition of agricultural products, and
forgetting for a moment that there is no more difference, so
far as the method of production is concerned, between the
production of corn and the production of ducks and eggs, we
will find ourselves driven to the conclusion that from the
standpoint of method of production there is no difference
between the production of fish in a "vivero de
562
562

Sotelo Matti vs. Bulletin Publishing Co.
peces" and the production of ducks upon land which is

recognized as agricultural lands. The majority opinion has
fallen into error by trying to make a 15th century definition
apply to 20th century conditions. The judgment of the
lower court should be affirmed with costs.
Judgment reversed defendant absolved of complaint.
______________
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Molina Vs Rafferty

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Molina Vs Rafferty

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[No. 11988. February 1, 1918. ]

On the 31st of August, 1917, the following judgment was rendered:

PHILIPPINE REPORTS ANNOTATED

to consider all those things as farming products or

generally employ the words which most directly and aptly

APPEAL from a judgment of the Court of First Instance of

VOL. 37, FEBRUARY 1, 1918