SMITH, BELL & COMPANY (LTD.), v (LTD.), v JOAQUIN NATIVIDAD 40 PHIL 136 Facts: Smith, Bell & Co., (Ltd.), is a corporation organized and existing under the las o! the "hilippine #slands. $ ma%orit o! its stoc'holders are British su%ects. #t is the oner o! a motor vessel 'non as the Bato uilt Bato uilt !or it in the "hilippine #slands in *+, o! more than !i!teen tons gross gross he Bato as as roug rought ht to Ceu Ceu in the the prese present nt ear ear !or the purpo purpose se o! transp transport ortin ing g plainti! plainti!!-s !-s merchan merchandise dise eteen eteen ports ports in the #slands. #slands. $pplicatio $pplication n (Certi!ic (Certi!icate ate o! "hilippi "hilippine ne egitr) as made at Ceu, the home port o! the vessel, to the Collector o! Customs !or a certi!icate o! "hilippine registr. he Collector re!used to issue the certi!icate, giving as his reason that all the stoc'holders o! Smith, Bell & Co., Ltd., ere not citizens either o! the /nited States or o! the "hilippine #slands under $ct 0o. 12+ hich provides: S3C. 21. Certificate of Philippine register. 4 /pon registration o! a vessel o! domestic onership, and o! more than !i!teen tons gross, a certi!icate o! "hilippine register shall e issued !or it. #! the vessel is o! domestic onership and o! !i!teen tons gross or less, the ta'ing o! the certi!icate o! "hilippine register shall e optional ith the oner. S3C. 2+. Investigation Investigation into character of vessel. — No application for a certificate of Philippine register shall be approved until the collector of customs is satisfied f!" #$ %$'*%!$ !f *+ - *+#* %* % $#/ ! /*%$/ *! $#/ %$ -%*%"#* *#/ #$/ that it is of domestic ownership as such ownership is defined in section eleven hundred hundred and seventy-two of this Code. Counsel sas that $ct 0o. 12+ denies to Smith, Bell & Co., Ltd., the e5ual protection o! the las ecause it, in e!!ect, prohiits the corporation !rom oning vessels, and ecause classi!ication o! corporations ased on the citizenship o! one or more o! their stoc'holders is capricious, and that $ct 0o. 12+ deprives the corporation o! its properl ithout due process o! la ecause the passage o! the la compan as automaticall deprived deprived o! ever ene!icial attriute o! onership in the Bato and Bato and le!t ith the na'ed title to a oat it could not use. #ssue: 6hether the legislature through $ct no. 12+ can den registr o! vessel ith !oreign stoc'holders. uling: 7es. 6e are inclined to the vie that hile Smith, Bell & Co. Ltd., # !'!#*%!$ +#%$ #-%$ *!+!-/, % $*%*-/ *! *+ '!**%!$ #ff!// 2 *+ /'! !f -#5 #$/ #- '!**%!$ !f *+ -#5 -# !f *+ P+%-%''%$ B%-- !f 7%+* , nevertheless nevertheless,, A* N!. 8961 !f *+ P+%-%''%$ L%-#*, %$ /$2%$ *! !'!#*%!$ + # S"%*+, B-- &. C!. L*/., *+ %+* *! %* - %$ *+ P+%-%''%$ !#*5% *#/, /! $!* -!$ *! *+#* %%! '% !f -# -%-#*%!$ -%-#*%!$ 5+%+ "* #-5#2 !$/"$/, * /! f#-5%*+%$ 5%*+%$ #*+!%: #*+!%:/ / ;'*%! ;'*%!$, $, $!*#-2, $!*#-2, 5%*+%$ 5%*+%$ *+ '%5 '%5 !f *+ '!-% '!-% '!5, '!5, #$/ ! /! $!* !ff$/ ##%$* *+ !$*%**%!$#- '!%%!$. he guaranties guaranties o! the Fourteenth Fourteenth $mend $mendment ment and so o! the !irst paragrap paragraph h o! the "hilippine Bill o! ights, are universal in their application to all person ithin the territorial %urisdiction, %urisdiction, ithout regard to an di!!erences di!!erences o! race, color, or nationalit. nationalit. he ord 8person8
includes aliens. "rivate corporations, li'eise, are 8persons8 ithin the scope o! the guaranties in so !ar as their propert is concerned. C-#%f%#*%!$ 5%*+ *+ $/ %$ %5 !f '!%/%$ /%%*2 !f *#*"$* "#2 "#/ #"!$ !'!#*%!$, * "* #/ '!$ !" #!$#- !$/ #$/ $!* # " #%*#2 -*%!$. $ literal application o! general principles to the !acts e!ore us ould, o! course, cause the inevitale deduction that $ct 0o. 12+ is unconstitutional reason o! its denial to a corporation, some o! hole memers are !oreigners, o! the e5ual protection o! the las. o %usti! that portion o! $ct no. 12+ hich permits corporations or companies to otain a certi!icate o! "hilippine registr onl on condition that the e composed holl o! citizens o! the "hilippine #slands or o! the /nited States or oth, as not in!ringing "hilippine 9rganic La, it must e done under some one o! the exceptions. 9ne o! the exceptions to the general rule, most persistent and !ar reaching in in!luence is, road and comprehensive as it is, nor an other amendment, 8as designed to inter!ere ith the poer o! the State, sometimes termed its <'!-% '!5 ,- to prescrie regulations to promote the health, peace, morals, education, and good order o! the people, and legislate so as to increase the industries o! the State, develop its resources and add to its ealth and prosperit. From the ver necessities o! societ, legislation o! a special character, having these o%ects in vie, must o!ten e had in certain districts. his is the same police poer hich the /nited States Supreme Court sa 8extends to so dealing ith the conditions hich exist in the state as to ring out o! them the greatest el!are in o! its people.8 For 5uite similar reasons, none o! the provision o! the "hilippine 9rganic La could could have had the e!!ect o! dening to the overnment o! the "hilippine #slands, acting through its Legislature, the right to exercise that most essential, insistent, and illimitale o! poers, the sovereign police poer, in the promotion o! the general el!are and the pulic interest. 6ithout an suter!uge, the apparent purpose o! the "hilippine Legislature is seen to e to enact an anti;alien shipping act. he ultimate purpose o! the Legislature is to encourage "hilippine ship;uilding.
