IN THE MATTER OF THE PETITION OF CHAN PENG HIAN TO BE ADMITTED A CITIZEN OF THE PHILIPPINES. CHAN PENG HIAN, PETITIONER AND APPELLANT, VS. REPUBLIC OF THE PHILIPPINES, OPPOSITOR…

Chan Peng Hian versus Republic of the Philippines

The Case

This is the naturalization case of Chan Peng Hian against the Republic of the Philippines. The petitioner had already won a judgment granting his petition for citizenship, but before he could take his oath the trial court refused to let him do so, finding that he had not shown a lucrative trade or profession. The case matters because it fixes the evidentiary standard for that requirement when the applicant claims to be employed by his own parents, and it warns against paper salaries and simulated employment designed to satisfy the law.

Procedural History

On the eighth of July, nineteen hundred sixty, the Court of First Instance of Manila rendered a decision granting Chan Peng Hian's petition for naturalization as a citizen of the Philippines. More than two years later, on the thirtieth of October, nineteen hundred sixty-two, the petitioner moved that a date be set for the reception of additional evidence as provided by law, and that he thereafter be allowed to take the corresponding oath of allegiance. The lower court received that evidence and found that the petitioner had no lucrative occupation. It accordingly issued an order denying the petition to be allowed to take the oath. The petitioner appealed that order directly to the Supreme Court, which decided the case on appeal.

Facts

Chan Peng Hian claimed that he had been working as a salesman for Huan Hieng and Company, a coffee and chocolate factory that sold only wholesale, since April nineteen hundred fifty-six. That partnership was controlled by his family: his father was the principal partner, having contributed forty-six thousand three hundred sixty-nine pesos and seventy-three centavos to the capital, as against thirty-nine thousand four hundred fourteen pesos and thirty-six centavos contributed by a third partner. The petitioner said he began at the age of barely nineteen, while he was an engineering student at the Mapua Institute of Technology, where he remained enrolled until he graduated in nineteen hundred sixty-one.

His initial salary was two thousand three hundred seventy pesos a year. It rose steadily to three thousand five hundred ten pesos in nineteen fifty-nine, three thousand six hundred pesos in nineteen sixty, and four thousand eight hundred pesos in nineteen sixty-one. He also received a bonus of one thousand two hundred pesos in nineteen sixty-one and four thousand pesos in nineteen sixty-two, although his duties apparently remained the same and no reason was given for the increases. The firm already had a manager, an assistant manager, and another salesman. The petitioner could name only four customers, and his described duties were to quote prices, close the deal, and issue the receipt.

The trial judge compared his compensation with that of the other employees. The manager and assistant manager each received four thousand eight hundred pesos annually, while three Filipino employees received the minimum of four pesos a day, never raised, with bonuses of only one hundred twenty pesos and one hundred pesos in nineteen sixty-two. The petitioner had filed income tax returns before and after his application, but the court found this of no decisive importance. On these facts the trial court held that the employment was more simulated than real and denied the oath.

Issues

• Whether or not the lower court erred in finding that the petitioner had failed to prove that he is engaged in a lucrative trade or profession.

Applicable Provisions

The decision applies the statutory requirement of a lucrative trade or profession, which the trial court quoted from the naturalization law as follows:

The requirement that the petitioner must have some known lucrative trade, profession or occupation is not satisfied by evidence that he is employed by close relatives, such as his parents, or in establishments wholly or partially owned by them.

This rule bears directly on the case because the petitioner's only claimed occupation was employment in his father's partnership.

The Court also relied on the settled caution regarding employment by a parent, quoted in the decision:

Where the applicant for naturalization claims to be employed by either of his parents he must submit more satisfactory proof than has been adduced herein that he is actually employed and worth the salary he is receiving, in order to eliminate any suspicion that his parents have employed him only as a convenient arrangement to satisfy the statutory requisites for naturalization.

This standard explains why the Court demanded more than the petitioner's testimony and his income tax returns.

Ruling

The Court resolved the sole issue against the petitioner. It held that the records fully bore out the facts relied upon by the trial judge, and that the conclusions drawn from those facts were patently justified by logic and reason as well as by previous rulings of the Court. The Court stressed that the requirement of a lucrative trade or profession is not satisfied by evidence that the applicant is employed by close relatives or in establishments wholly or partially owned by them, because father and son may testify to the alleged employment in the interest of the petition even though the son is merely living under the protection and at the expense of the father.

The Court likewise accepted the trial court's finding that the employment was simulated. The salary was excessive from the beginning and was steadily increased without any change in duties, the bonuses were out of proportion to the shares of the partners, and the petitioner's compensation exceeded that of the manager and assistant manager while the rank and file received the minimum wage. On the income tax returns, the Court quoted with approval that an income tax return is not always a reliable evidence of employment or income, especially when the alleged employer is a close relative who has exclusive control of his business and is free to juggle its records and funds. The Court noted that it could not understand how the Office of the Solicitor General could recommend that the petitioner be allowed to take his oath, although leaving the matter to the Court's sound discretion.

Doctrine

A petitioner for naturalization must prove a known lucrative trade, profession, or occupation. That requirement is not satisfied by evidence that the petitioner is employed by close relatives, such as his parents, or in establishments wholly or partially owned by them. Where the applicant claims employment by a parent, he must submit more satisfactory proof that he is actually employed and worth the salary he receives, to eliminate any suspicion that the employment is a convenient arrangement to satisfy the statutory requisites. Income tax returns are not always reliable evidence of employment or income, and simulated increases in salary and bonus, unaccompanied by any increase in duties or in the business, do not establish a lucrative occupation.

Disposition

The Supreme Court affirmed the order appealed from, with costs against the petitioner and appellant, so that Chan Peng Hian was not allowed to take his oath as a citizen of the Philippines.

Remember This

Employment by one's parents or in a family-owned business is not, by itself, proof of a lucrative trade or profession; the applicant must show real work and real compensation. Examiners use this case to test simulated employment, paper salary increases, and the weight of income tax returns in naturalization proceedings.