Admin Law Proper Cases.docx

G.R. No. 102976 October 25, 1995 IRON AND STEEL AUTHORITY, petitioner, vs. THE COURT OF APPEALS and MARIA CRISTINA FERTILIZER CORPORATION, respondents. FELICIANO, J.: Petitioner Iron and Steel Authority ("ISA") was created by Presidential Decree (P.D.) No. 272 dated 9 August 1973 in order, generally, to develop and promote the iron and steel industry in the Philippines. The objectives of the ISA are spelled out in the following terms: Sec. 2. Objectives — The Authority shall have the following objectives: (a) to strengthen the iron and steel industry of the Philippines and to expand the domestic and export markets for the products of the industry; (b) to promote the consolidation, integration and rationalization of the industry in order to increase industry capability and viability to service the domestic market and to compete in international markets; (c) to rationalize the marketing and distribution of steel products in order to achieve a balance between demand and supply of iron and steel products for the country and to ensure that industry prices and profits are at levels that provide a fair balance between the interests of investors, consumers suppliers, and the public at large; (d) to promote full utilization of the existing capacity of the industry, to discourage investment in excess capacity, and in coordination, with appropriate government agencies to encourage capital investment in priority areas of the industry; (e) to assist the industry in securing adequate and low-cost supplies of raw materials and to reduce the excessive dependence of the country on imports of iron and steel. The list of powers and functions of the ISA included the following: Sec. 4. Powers and Functions. — The authority shall have the following powers and functions: xxx xxx xxx (j) to initiate expropriation of land required for basic iron and steel facilities for subsequent resale and/or lease to the companies involved if it is shown that such use of the State's power is necessary to implement the construction of capacity which is needed for the attainment of the objectives of the Authority; xxx xxx xxx (Emphasis supplied) P.D. No. 272 initially created petitioner ISA for a term of five (5) years counting from 9 August 1973. 1 When ISA's original term expired on 10 October 1978, its term was extended for another ten (10) years by Executive Order No. 555 dated 31 August 1979. The National Steel Corporation ("NSC") then a wholly owned subsidiary of the National Development Corporation which is itself an entity wholly owned by the National Government, embarked on an expansion program embracing, among other things, the construction of an integrated steel mill in Iligan City. The construction of such a steel mill was considered a priority and major industrial project of the Government.

Pursuant to the expansion program of the NSC, Proclamation No. 2239 was issued by the President of the Philippines on 16 November 1982 withdrawing from sale or settlement a large tract of public land (totalling about 30.25 hectares in area) located in Iligan City, and reserving that land for the use and immediate occupancy of NSC. Since certain portions of the public land subject matter Proclamation No. 2239 were occupied by a nonoperational chemical fertilizer plant and related facilities owned by private respondent Maria Cristina Fertilizer Corporation ("MCFC"), Letter of Instruction (LOI), No. 1277, also dated 16 November 1982, was issued directing the NSC to "negotiate with the owners of MCFC, for and on behalf of the Government, for the compensation of MCFC's present occupancy rights on the subject land." LOI No. 1277 also directed that should NSC and private respondent MCFC fail to reach an agreement within a period of sixty (60) days from the date of LOI No. 1277, petitioner ISA was to exercise its power of eminent domain under P.D. No. 272 and to initiate expropriation proceedings in respect of occupancy rights of private respondent MCFC relating to the subject public land as well as the plant itself and related facilities and to cede the same to the NSC.2 Negotiations between NSC and private respondent MCFC did fail. Accordingly, on 18 August 1983, petitioner ISA commenced eminent domain proceedings against private respondent MCFC in the Regional Trial Court, Branch 1, of Iligan City, praying that it (ISA) be places in possession of the property involved upon depositing in court the amount of P1,760,789.69 representing ten percent (10%) of the declared market values of that property. The Philippine National Bank, as mortgagee of the plant facilities and improvements involved in the expropriation proceedings, was also impleaded as party-defendant. On 17 September 1983, a writ of possession was issued by the trial court in favor of ISA. ISA in turn placed NSC in possession and control of the land occupied by MCFC's fertilizer plant installation. The case proceeded to trial. While the trial was ongoing, however, the statutory existence of petitioner ISA expired on 11 August 1988. MCFC then filed a motion to dismiss, contending that no valid judgment could be rendered against ISA which had ceased to be a juridical person. Petitioner ISA filed its opposition to this motion. In an Order dated 9 November 1988, the trial court granted MCFC's motion to dismiss and did dismiss the case. The dismissal was anchored on the provision of the Rules of Court stating that "only natural or juridical persons or entities authorized by law may be parties in a civil case."3 The trial court also referred to noncompliance by petitioner ISA with the requirements of Section 16, Rule 3 of the Rules of Court.4 Petitioner ISA moved for reconsideration of the trial court's Order, contending that despite the expiration of its term, its juridical existence continued until the winding up of its affairs could be completed. In the alternative, petitioner ISA urged that the Republic of the Philippines, being the real party-in-interest, should be allowed to be substituted for petitioner ISA. In this connection, ISA referred to a letter from the Office of the President dated 28 September 1988 which especially directed the Solicitor General to continue the expropriation case. The trial court denied the motion for reconsideration, stating, among other things that: The property to be expropriated is not for public use or benefit [__] but for the use and benefit [__] of NSC, a government controlled private corporation engaged in private business and for profit, specially now that the government, according to newspaper reports, is offering for sale to the public its [shares of stock] in the National Steel Corporation in line with the pronounced policy of the present administration to disengage the government from its private business ventures.5 (Brackets supplied) Petitioner went on appeal to the Court of Appeals. In a Decision dated 8 October 1991, the Court of Appeals affirmed the order of dismissal of the trial court. The Court of Appeals held that petitioner ISA, "a government regulatory agency exercising sovereign functions," did not have the same rights as an ordinary corporation and that the ISA, unlike corporations organized under the Corporation Code, was not entitled to a period for winding up its affairs after expiration of its legally mandated term, with the result that upon expiration of its term

on 11 August 1987, ISA was "abolished and [had] no more legal authority to perform governmental functions." The Court of Appeals went on to say that the action for expropriation could not prosper because the basis for the proceedings, the ISA's exercise of its delegated authority to expropriate, had become ineffective as a result of the delegate's dissolution, and could not be continued in the name of Republic of the Philippines, represented by the Solicitor General: It is our considered opinion that under the law, the complaint cannot prosper, and therefore, has to be dismissed without prejudice to the refiling of a new complaint for expropriation if the Congress sees it fit." (Emphases supplied) At the same time, however, the Court of Appeals held that it was premature for the trial court to have ruled that the expropriation suit was not for a public purpose, considering that the parties had not yet rested their respective cases. In this Petition for Review, the Solicitor General argues that since ISA initiated and prosecuted the action for expropriation in its capacity as agent of the Republic of the Philippines, the Republic, as principal of ISA, is entitled to be substituted and to be made a party-plaintiff after the agent ISA's term had expired. Private respondent MCFC, upon the other hand, argues that the failure of Congress to enact a law further extending the term of ISA after 11 August 1988 evinced a "clear legislative intent to terminate the juridical existence of ISA," and that the authorization issued by the Office of the President to the Solicitor General for continued prosecution of the expropriation suit could not prevail over such negative intent. It is also contended that the exercise of the eminent domain by ISA or the Republic is improper, since that power would be exercised "not on behalf of the National Government but for the benefit of NSC." The principal issue which we must address in this case is whether or not the Republic of the Philippines is entitled to be substituted for ISA in view of the expiration of ISA's term. As will be made clear below, this is really the only issue which we must resolve at this time. Rule 3, Section 1 of the Rules of Court specifies who may be parties to a civil action: Sec. 1. Who May Be Parties. — Only natural or juridical persons or entities authorized by law may be parties in a civil action. Under the above quoted provision, it will be seen that those who can be parties to a civil action may be broadly categorized into two (2) groups: (a) those who are recognized as persons under the law whether natural, i.e., biological persons, on the one hand, or juridical person such as corporations, on the other hand; and (b) entities authorized by law to institute actions. Examination of the statute which created petitioner ISA shows that ISA falls under category (b) above. P.D. No. 272, as already noted, contains express authorization to ISA to commence expropriation proceedings like those here involved: Sec. 4. Powers and Functions. — The Authority shall have the following powers and functions: xxx xxx xxx (j) to initiate expropriation of land required for basic iron and steel facilities for subsequent resale and/or lease to the companies involved if it is shown that such use of the State's power is necessary to implement the construction of capacity which is needed for the attainment of the objectives of the Authority;

xxx xxx xxx (Emphasis supplied) It should also be noted that the enabling statute of ISA expressly authorized it to enter into certain kinds of contracts "for and in behalf of the Government" in the following terms: xxx xxx xxx (i) to negotiate, and when necessary, to enter into contracts for and in behalf of the government, for the bulk purchase of materials, supplies or services for any sectors in the industry, and to maintain inventories of such materials in order to insure a continuous and adequate supply thereof and thereby reduce operating costs of such sector; xxx xxx xxx (Emphasis supplied) Clearly, ISA was vested with some of the powers or attributes normally associated with juridical personality. There is, however, no provision in P.D. No. 272 recognizing ISA as possessing general or comprehensive juridical personality separate and distinct from that of the Government. The ISA in fact appears to the Court to be a non-incorporated agency or instrumentality of the Republic of the Philippines, or more precisely of the Government of the Republic of the Philippines. It is common knowledge that other agencies or instrumentalities of the Government of the Republic are cast in corporate form, that is to say, are incorporated agencies or instrumentalities, sometimes with and at other times without capital stock, and accordingly vested with a juridical personality distinct from the personality of the Republic. Among such incorporated agencies or instrumentalities are: National Power Corporation;6 Philippine Ports Authority;7 National Housing Authority;8 Philippine National Oil Company;9 Philippine National Railways; 10 Public Estates Authority; 11 Philippine Virginia Tobacco Administration,12 and so forth. It is worth noting that the term "Authority" has been used to designate both incorporated and non-incorporated agencies or instrumentalities of the Government. We consider that the ISA is properly regarded as an agent or delegate of the Republic of the Philippines. The Republic itself is a body corporate and juridical person vested with the full panoply of powers and attributes which are compendiously described as "legal personality." The relevant definitions are found in the Administrative Code of 1987: Sec. 2. General Terms Defined. — Unless the specific words of the text, or the context as a whole, or a particular statute, require a different meaning: (1) Government of the Republic of the Philippines refers to the corporate governmental entity through which the functions of government are exercised throughout the Philippines, including, save as the contrary appears from the context, the various arms through which political authority is made effective in the Philippines, whether pertaining to the autonomous regions, the provincial, city, municipal or barangay subdivisions or other forms of local government. xxx xxx xxx (4) Agency of the Government refers to any of the various units of the Government, including a department, bureau, office, instrumentality, or government-owned or controlled corporation, or a local government or a distinct unit therein. xxx xxx xxx

(10) Instrumentality refers to any agency of the National Government, not integrated within the department framework, vested with special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying operational autonomy, usually through a charter. This term includes regulatory agencies, chartered institutions and government-owned or controlled corporations. xxx xxx xxx (Emphases supplied) When the statutory term of a non-incorporated agency expires, the powers, duties and functions as well as the assets and liabilities of that agency revert back to, and are re-assumed by, the Republic of the Philippines, in the absence of special provisions of law specifying some other disposition thereof such as, e.g., devolution or transmission of such powers, duties, functions, etc. to some other identified successor agency or instrumentality of the Republic of the Philippines. When the expiring agency is an incorporated one, the consequences of such expiry must be looked for, in the first instance, in the charter of that agency and, by way of supplementation, in the provisions of the Corporation Code. Since, in the instant case, ISA is a nonincorporated agency or instrumentality of the Republic, its powers, duties, functions, assets and liabilities are properly regarded as folded back into the Government of the Republic of the Philippines and hence assumed once again by the Republic, no special statutory provision having been shown to have mandated succession thereto by some other entity or agency of the Republic. The procedural implications of the relationship between an agent or delegate of the Republic of the Philippines and the Republic itself are, at least in part, spelled out in the Rules of Court. The general rule is, of course, that an action must be prosecuted and defended in the name of the real party in interest. (Rule 3, Section 2) Petitioner ISA was, at the commencement of the expropriation proceedings, a real party in interest, having been explicitly authorized by its enabling statute to institute expropriation proceedings. The Rules of Court at the same time expressly recognize the role of representative parties: Sec. 3. Representative Parties. — A trustee of an expressed trust, a guardian, an executor or administrator, or a party authorized by statute may sue or be sued without joining the party for whose benefit the action is presented or defended; but the court may, at any stage of the proceedings, order such beneficiary to be made a party. . . . . (Emphasis supplied) In the instant case, ISA instituted the expropriation proceedings in its capacity as an agent or delegate or representative of the Republic of the Philippines pursuant to its authority under P.D. No. 272. The present expropriation suit was brought on behalf of and for the benefit of the Republic as the principal of ISA. Paragraph 7 of the complaint stated: 7. The Government, thru the plaintiff ISA, urgently needs the subject parcels of land for the construction and installation of iron and steel manufacturing facilities that are indispensable to the integration of the iron and steel making industry which is vital to the promotion of public interest and welfare. (Emphasis supplied) The principal or the real party in interest is thus the Republic of the Philippines and not the National Steel Corporation, even though the latter may be an ultimate user of the properties involved should the condemnation suit be eventually successful. From the foregoing premises, it follows that the Republic of the Philippines is entitled to be substituted in the expropriation proceedings as party-plaintiff in lieu of ISA, the statutory term of ISA having expired. Put a little differently, the expiration of ISA's statutory term did not by itself require or justify the dismissal of the eminent domain proceedings. It is also relevant to note that the non-joinder of the Republic which occurred upon the expiration of ISA's statutory term, was not a ground for dismissal of such proceedings since a party may be dropped or added by

order of the court, on motion of any party or on the court's own initiative at any stage of the action and on such terms as are just. 13 In the instant case, the Republic has precisely moved to take over the proceedings as party-plaintiff. In E.B. Marcha Transport Company, Inc. v. Intermediate Appellate Court, 14 the Court recognized that the Republic may initiate or participate in actions involving its agents. There the Republic of the Philippines was held to be a proper party to sue for recovery of possession of property although the "real" or registered owner of the property was the Philippine Ports Authority, a government agency vested with a separate juridical personality. The Court said: It can be said that in suing for the recovery of the rentals, the Republic of the Philippines acted as principal of the Philippine Ports Authority, directly exercising the commission it had earlier conferred on the latter as its agent. . . .15 (Emphasis supplied) In E.B. Marcha, the Court also stressed that to require the Republic to commence all over again another proceeding, as the trial court and Court of Appeals had required, was to generate unwarranted delay and create needless repetition of proceedings: More importantly, as we see it, dismissing the complaint on the ground that the Republic of the Philippines is not the proper party would result in needless delay in the settlement of this matter and also in derogation of the policy against multiplicity of suits. Such a decision would require the Philippine Ports Authority to refile the very same complaint already proved by the Republic of the Philippines and bring back as it were to square one.16 (Emphasis supplied) As noted earlier, the Court of Appeals declined to permit the substitution of the Republic of the Philippines for the ISA upon the ground that the action for expropriation could not prosper because the basis for the proceedings, the ISA's exercise of its delegated authority to expropriate, had become legally ineffective by reason of the expiration of the statutory term of the agent or delegated i.e., ISA. Since, as we have held above, the powers and functions of ISA have reverted to the Republic of the Philippines upon the termination of the statutory term of ISA, the question should be addressed whether fresh legislative authority is necessary before the Republic of the Philippines may continue the expropriation proceedings initiated by its own delegate or agent. While the power of eminent domain is, in principle, vested primarily in the legislative department of the government, we believe and so hold that no new legislative act is necessary should the Republic decide, upon being substituted for ISA, in fact to continue to prosecute the expropriation proceedings. For the legislative authority, a long time ago, enacted a continuing or standing delegation of authority to the President of the Philippines to exercise, or cause the exercise of, the power of eminent domain on behalf of the Government of the Republic of the Philippines. The 1917 Revised Administrative Code, which was in effect at the time of the commencement of the present expropriation proceedings before the Iligan Regional Trial Court, provided that: Sec. 64. Particular powers and duties of the President of the Philippines. — In addition to his general supervisory authority, the President of the Philippines shall have such other specific powers and duties as are expressly conferred or imposed on him by law, and also, in particular, the powers and duties set forth in this Chapter. Among such special powers and duties shall be: xxx xxx xxx (h) To determine when it is necessary or advantageous to exercise the right of eminent domain in behalf of the Government of the Philippines; and to direct the Secretary of Justice, where such act is deemed advisable, to cause the condemnation proceedings to be begun in the court having proper jurisdiction. (Emphasis supplied)

The Revised Administrative Code of 1987 currently in force has substantially reproduced the foregoing provision in the following terms: Sec. 12. Power of eminent domain. — The President shall determine when it is necessary or advantageous to exercise the power of eminent domain in behalf of the National Government, and direct the Solicitor General, whenever he deems the action advisable, to institute expopriation proceedings in the proper court. (Emphasis supplied) In the present case, the President, exercising the power duly delegated under both the 1917 and 1987 Revised Administrative Codes in effect made a determination that it was necessary and advantageous to exercise the power of eminent domain in behalf of the Government of the Republic and accordingly directed the Solicitor General to proceed with the suit. 17 It is argued by private respondent MCFC that, because Congress after becoming once more the depository of primary legislative power, had not enacted a statute extending the term of ISA, such non-enactment must be deemed a manifestation of a legislative design to discontinue or abort the present expropriation suit. We find this argument much too speculative; it rests too much upon simple silence on the part of Congress and casually disregards the existence of Section 12 of the 1987 Administrative Code already quoted above. Other contentions are made by private respondent MCFC, such as, that the constitutional requirement of "public use" or "public purpose" is not present in the instant case, and that the indispensable element of just compensation is also absent. We agree with the Court of Appeals in this connection that these contentions, which were adopted and set out by the Regional Trial Court in its order of dismissal, are premature and are appropriately addressed in the proceedings before the trial court. Those proceedings have yet to produce a decision on the merits, since trial was still on going at the time the Regional Trial Court precipitously dismissed the expropriation proceedings. Moreover, as a pragmatic matter, the Republic is, by such substitution as partyplaintiff, accorded an opportunity to determine whether or not, or to what extent, the proceedings should be continued in view of all the subsequent developments in the iron and steel sector of the country including, though not limited to, the partial privatization of the NSC. WHEREFORE, for all the foregoing, the Decision of the Court of Appeals dated 8 October 1991 to the extent that it affirmed the trial court's order dismissing the expropriation proceedings, is hereby REVERSED and SET ASIDE and the case is REMANDED to the court a quo which shall allow the substitution of the Republic of the Philippines for petitioner Iron and Steel Authority and for further proceedings consistent with this Decision. No pronouncement as to costs. SO ORDERED.

G.R. No. 103982 December 11, 1992 ANTONIO A. MECANO, petitioner, vs. COMMISSION ON AUDIT, respondent.

CAMPOS, JR., J.: Antonio A. Mecano, through a petition for certiorari, seeks to nullify the decision of the Commission on Audit (COA, for brevity) embodied in its 7th Indorsement, dated January 16, 1992, denying his claim for reimbursement under Section 699 of the Revised Administrative Code (RAC), as amended, in the total amount of P40,831.00.

Petitioner is a Director II of the National Bureau of Investigation (NBI). He was hospitalized for cholecystitis from March 26, 1990 to April 7, 1990, on account of which he incurred medical and hospitalization expenses, the total amount of which he is claiming from the COA. On May 11, 1990, in a memorandum to the NBI Director, Alfredo S. Lim (Director Lim, for brevity), he requested reimbursement for his expenses on the ground that he is entitled to the benefits under Section 6991 of the RAC, the pertinent provisions of which read: Sec. 699. Allowances in case of injury, death, or sickness incurred in performance of duty. — When a person in the service of the national government of a province, city, municipality or municipal district is so injured in the performance of duty as thereby to receive some actual physical hurt or wound, the proper Head of Department may direct that absence during any period of disability thereby occasioned shall be on full pay, though not more than six months, and in such case he may in his discretion also authorize the payment of the medical attendance, necessary transportation, subsistence and hospital fees of the injured person. Absence in the case contemplated shall be charged first against vacation leave, if any there be. xxx xxx xxx In case of sickness caused by or connected directly with the performance of some act in the line of duty, the Department head may in his discretion authorize the payment of the necessary hospital fees. Director Lim then forwarded petitioner's claim, in a 1st Indorsement dated June 22, 1990, to the Secretary of Justice, along with the comment, bearing the same date, of Gerarda Galang, Chief, LED of the NBI, "recommending favorable action thereof". Finding petitioner's illness to be service-connected, the Committee on Physical Examination of the Department of Justice favorably recommended the payment of petitioner's claim. However, then Undersecretary of Justice Silvestre H. Bello III, in a 4th Indorsement dated November 21, 1990, returned petitioner's claim to Director Lim, having considered the statements of the Chairman of the COA in its 5th Indorsement dated 19 September 1990, to the effect that the RAC being relied upon was repealed by the Administrative Code of 1987. Petitioner then re-submitted his claim to Director Lim, with a copy of Opinion No. 73, S. 19912 dated April 26, 1991 of then Secretary of Justice Franklin M. Drilon (Secretary Drilon, for brevity) stating that "the issuance of the Administrative Code did not operate to repeal or abregate in its entirety the Revised Administrative Code, including the particular Section 699 of the latter". On May 10, 1991, Director Lim, under a 5th Indorsement transmitted anew Mecano's claim to then Undersecretary Bello for favorable consideration. Under a 6th Indorsement, dated July 2, 1991, Secretary Drilon forwarded petitioner's claim to the COA Chairman, recommending payment of the same. COA Chairman Eufemio C. Domingo, in his 7th Indorsement of January 16, 1992, however, denied petitioner's claim on the ground that Section 699 of the RAC had been repealed by the Administrative Code of 1987, solely for the reason that the same section was not restated nor re-enacted in the Administrative Code of 1987. He commented, however, that the claim may be filed with the Employees' Compensation Commission, considering that the illness of Director Mecano occurred after the effectivity of the Administrative Code of 1987. Eventually, petitioner's claim was returned by Undersecretary of Justice Eduardo Montenegro to Director Lim under a 9th Indorsement dated February 7, 1992, with the advice that petitioner "elevate the matter to the Supreme Court if he so desires". On the sole issue of whether or not the Administrative Code of 1987 repealed or abrogated Section 699 of the RAC, this petition was brought for the consideration of this Court.

Petitioner anchors his claim on Section 699 of the RAC, as amended, and on the aforementioned Opinion No. 73, S. 1991 of Secretary Drilon. He further maintains that in the event that a claim is filed with the Employees' Compensation Commission, as suggested by respondent, he would still not be barred from filing a claim under the subject section. Thus, the resolution of whether or not there was a repeal of the Revised Administrative Code of 1917 would decide the fate of petitioner's claim for reimbursement. The COA, on the other hand, strongly maintains that the enactment of the Administrative Code of 1987 (Exec. Order No. 292) operated to revoke or supplant in its entirety the Revised Administrative Code of 1917. The COA claims that from the "whereas" clauses of the new Administrative Code, it can be gleaned that it was the intent of the legislature to repeal the old Code. Moreover, the COA questions the applicability of the aforesaid opinion of the Secretary of Justice in deciding the matter. Lastly, the COA contends that employment-related sickness, injury or death is adequately covered by the Employees' Compensation Program under P.D. 626, such that to allow simultaneous recovery of benefits under both laws on account of the same contingency would be unfair and unjust to the Government. The question of whether a particular law has been repealed or not by a subsequent law is a matter of legislative intent. The lawmakers may expressly repeal a law by incorporating therein a repealing provision which expressly and specifically cites the particular law or laws, and portions thereof, that are intended to be repealed.3 A declaration in a statute, usually in its repealing clause, that a particular and specific law, identified by its number or title, is repealed is an express repeal; all others are implied repeals. 4 In the case of the two Administrative Codes in question, the ascertainment of whether or not it was the intent of the legislature to supplant the old Code with the new Code partly depends on the scrutiny of the repealing clause of the new Code. This provision is found in Section 27, Book VII (Final Provisions) of the Administrative Code of 1987 which reads: Sec. 27. Repealing Clause. — All laws, decrees, orders, rules and regulations, or portions thereof, inconsistent with this Code are hereby repealed or modified accordingly. The question that should be asked is: What is the nature of this repealing clause? It is certainly not an express repealing clause because it fails to identify or designate the act or acts that are intended to be repealed.5 Rather, it is an example of a general repealing provision, as stated in Opinion No. 73, S. 1991. It is a clause which predicates the intended repeal under the condition that substantial conflict must be found in existing and prior acts. The failure to add a specific repealing clause indicates that the intent was not to repeal any existing law, unless an irreconcilable inconcistency and repugnancy exist in the terms of the new and old laws.6 This latter situation falls under the category of an implied repeal. Repeal by implication proceeds on the premise that where a statute of later date clearly reveals an intention on the part of the legislature to abrogate a prior act on the subject, that intention must be given effect. 7 Hence, before there can be a repeal, there must be a clear showing on the part of the lawmaker that the intent in enacting the new law was to abrogate the old one. The intention to repeal must be clear and manifest;8 otherwise, at least, as a general rule, the later act is to be construed as a continuation of, and not a substitute for, the first act and will continue so far as the two acts are the same from the time of the first enactment.9 There are two categories of repeal by implication. The first is where provisions in the two acts on the same subject matter are in an irreconcilable conflict, the later act to the extent of the conflict constitutes an implied repeal of the earlier one. The second is if the later act covers the whole subject of the earlier one and is clearly intended as a substitute, it will operate to repeal the earlier law.10 Implied repeal by irreconcilable inconsistency takes place when the two statutes cover the same subject matter; they are so clearly inconsistent and incompatible with each other that they cannot be reconciled or harmonized; and both cannot be given effect, that is, that one law cannot be enforced without nullifying the other.11

Comparing the two Codes, it is apparent that the new Code does not cover nor attempt to cover the entire subject matter of the old Code. There are several matters treated in the old Code which are not found in the new Code, such as the provisions on notaries public, the leave law, the public bonding law, military reservations, claims for sickness benefits under Section 699, and still others. Moreover, the COA failed to demonstrate that the provisions of the two Codes on the matter of the subject claim are in an irreconcilable conflict. In fact, there can be no such conflict because the provision on sickness benefits of the nature being claimed by petitioner has not been restated in the Administrative Code of 1987. However, the COA would have Us consider that the fact that Section 699 was not restated in the Administrative Code of 1987 meant that the same section had been repealed. It further maintained that to allow the particular provisions not restated in the new Code to continue in force argues against the Code itself. The COA anchored this argument on the whereas clause of the 1987 Code, which states: WHEREAS, the effectiveness of the Government will be enhanced by a new Administrative Code which incorporate in a unified document the major structural, functional and procedural principles and rules of governance; and xxx

xxx

xxx

It argues, in effect, that what is contemplated is only one Code — the Administrative Code of 1987. This contention is untenable. The fact that a later enactment may relate to the same subject matter as that of an earlier statute is not of itself sufficient to cause an implied repeal of the prior act, since the new statute may merely be cumulative or a continuation of the old one. 12 What is necessary is a manifest indication of legislative purpose to repeal.13 We come now to the second category of repeal — the enactment of a statute revising or codifying the former laws on the whole subject matter. This is only possible if the revised statute or code was intended to cover the whole subject to be a complete and perfect system in itself. It is the rule that a subsequent statute is deemed to repeal a prior law if the former revises the whole subject matter of the former statute.14 When both intent and scope clearly evidence the idea of a repeal, then all parts and provisions of the prior act that are omitted from the revised act are deemed repealed.15 Furthermore, before there can be an implied repeal under this category, it must be the clear intent of the legislature that the later act be the substitute to the prior act.16 According to Opinion No. 73, S. 1991 of the Secretary of Justice, what appears clear is the intent to cover only those aspects of government that pertain to administration, organization and procedure, understandably because of the many changes that transpired in the government structure since the enactment of the RAC decades of years ago. The COA challenges the weight that this opinion carries in the determination of this controversy inasmuch as the body which had been entrusted with the implementation of this particular provision has already rendered its decision. The COA relied on the rule in administrative law enunciated in the case of Sison vs. Pangramuyen17 that in the absence of palpable error or grave abuse of discretion, the Court would be loathe to substitute its own judgment for that of the administrative agency entrusted with the enforcement and implementation of the law. This will not hold water. This principle is subject to limitations. Administrative decisions may be reviewed by the courts upon a showing that the decision is vitiated by fraud, imposition or mistake.18 It has been held that Opinions of the Secretary and Undersecretary of Justice are material in the construction of statutes in pari materia.19 Lastly, it is a well-settled rule of statutory construction that repeals of statutes by implication are not favored.20 The presumption is against inconsistency and repugnancy for the legislature is presumed to know the existing laws on the subject and not to have enacted inconsistent or conflicting statutes.21 This Court, in a case, explains the principle in detail as follows: "Repeals by implication are not favored, and will not be decreed unless it is manifest that the legislature so intended. As laws are presumed to be passed with deliberation with full knowledge of all existing ones on the subject, it is but reasonable to conclude that in passing a statute it was not intended to interfere with or abrogate any former law relating to some matter,

unless the repugnancy between the two is not only irreconcilable, but also clear and convincing, and flowing necessarily from the language used, unless the later act fully embraces the subject matter of the earlier, or unless the reason for the earlier act is beyond peradventure renewed. Hence, every effort must be used to make all acts stand and if, by any reasonable construction, they can be reconciled, the later act will not operate as a repeal of the earlier.22 Regarding respondent's contention that recovery under this subject section shall bar the recovery of benefits under the Employees' Compensation Program, the same cannot be upheld. The second sentence of Article 173, Chapter II, Title II (dealing on Employees' Compensation and State Insurance Fund), Book IV of the Labor Code, as amended by P.D. 1921, expressly provides that "the payment of compensation under this Title shall not bar the recovery of benefits as provided for in Section 699 of the Revised Administrative Code . . . whose benefits are administered by the system (meaning SSS or GSIS) or by other agencies of the government." WHEREFORE, premises considered, the Court resolves to GRANT the petition; respondent is hereby ordered to give due course to petitioner's claim for benefits. No costs. SO ORDERED.

[G.R. No. 142801-802. July 10, 2001]

BUKLOD NG KAWANING EIIB, CESAR POSADA, REMEDIOS G. PRINCESA, BENJAMIN KHO, BENIGNO MANGA, LULU MENDOZA, petitioners, vs. HON. EXECUTIVE SECRETARY RONALDO B. ZAMORA, HON. SECRETARY JOSE PARDO, DEPARTMENT OF FINANCE, HON. SECRETARY BENJAMIN DIOKNO, DEPARTMENT OF BUDGET AND MANAGEMENT, HON. SECRETARY ARTEMIO TUQUERO, DEPARTMENT OF JUSTICE, respondents. DECISION SANDOVAL-GUTIERREZ, J.: In this petition for certiorari, prohibition and mandamus, petitioners Buklod Ng Kawaning EIIB, Cesar Posada, Remedios Princesa, Benjamin Kho, Benigno Manga and Lulu Mendoza, for themselves and in behalf of others with whom they share a common or general interest, seek the nullification of Executive Order No. 191[1] and Executive Order No. 223[2] on the ground that they were issued by the Office of the President with grave abuse of discretion and in violation of their constitutional right to security of tenure. The facts are undisputed: On June 30, 1987, former President Corazon C. Aquino, issued Executive Order No. 127 [3] establishing the Economic Intelligence and Investigation Bureau (EIIB) as part of the structural organization of the Ministry of Finance.[4] The EIIB was designated to perform the following functions: (a) Receive, gather and evaluate intelligence reports and information and evidence on the nature, modes and extent of illegal activities affecting the national economy, such as, but not limited to, economic sabotage, smuggling, tax evasion, and dollar-salting, investigate the same and aid in the prosecution of cases; (b) Coordinate with external agencies in monitoring the financial and economic activities of persons or entities, whether domestic or foreign, which may adversely affect national financial interest with the goal of regulating, controlling or preventing said activities; (c) Provide all intelligence units of operating Bureaus or Offices under the Ministry with the general framework and guidelines in the conduct of intelligence and investigating works;

(d) Supervise, monitor and coordinate all the intelligence and investigation operations of the operating Bureaus and Offices under the Ministry; (e) Investigate, hear and file, upon clearance by the Minister, anti-graft and corruption cases against personnel of the Ministry and its constituents units; (f) Perform such other appropriate functions as may be assigned by the Minister or his deputies.[5] In a desire to achieve harmony of efforts and to prevent possible conflicts among agencies in the course of their antismuggling operations, President Aquino issued Memorandum Order No. 225 on March 17, 1989, providing, among others, that the EIIB shall be the agency of primary responsibility for anti-smuggling operations in all land areas and inland waters and waterways outside the areas of sole jurisdiction of the Bureau of Customs.[6] Eleven years after, or on January 7, 2000, President Joseph Estrada issued Executive Order No. 191 entitled Deactivation of the Economic Intelligence and Investigation Bureau.[7] Motivated by the fact that the designated functions of the EIIB are also being performed by the other existing agencies of the government and that there is a need to constantly monitor the overlapping of functions among these agencies, former President Estrada ordered the deactivation of EIIB and the transfer of its functions to the Bureau of Customs and the National Bureau of Investigation. Meanwhile, President Estrada issued Executive Order No. 196[8] creating the Presidential Anti-Smuggling Task Force Aduana.[9] Then the day feared by the EIIB employees came. On March 29, 2000, President Estrada issued Executive Order No. 223[10] providing that all EIIB personnel occupying positions specified therein shall be deemed separated from the service effective April 30, 2000, pursuant to a bona fide reorganization resulting to abolition, redundancy, merger, division, or consolidation of positions.[11] Agonizing over the loss of their employment, petitioners now come before this Court invoking our power of judicial review of Executive Order Nos. 191 and 223. They anchor their petition on the following arguments: A Executive Order Nos. 191 and 223 should be annulled as they are unconstitutional for being violative of Section 2(3), Article IX-B of the Philippine Constitution and/or for having been issued with grave abuse of discretion amounting to lack or excess of jurisdiction. B. The abolition of the EIIB is a hoax. Similarly, if Executive Order Nos. 191 and 223 are considered to effect a reorganization of the EIIB, such reorganization was made in bad faith. C. The President has no authority to abolish the EIIB. Petitioners contend that the issuance of the afore-mentioned executive orders is: (a) a violation of their right to security of tenure; (b) tainted with bad faith as they were not actually intended to make the bureaucracy more efficient but to give way to Task Force Aduana, the functions of which are essentially and substantially the same as that of EIIB; and (c) a usurpation of the power of Congress to decide whether or not to abolish the EIIB. Arguing in behalf of respondents, the Solicitor General maintains that: (a) the President enjoys the totality of the executive power provided under Sections 1 and 7, Article VII of the Constitution, thus, he has the authority to issue Executive Order Nos. 191 and 223; (b) the said executive orders were issued in the interest of national economy, to avoid duplicity of work and to streamline the functions of the bureaucracy; and (c) the EIIB was not abolished, it was only deactivated. The petition is bereft of merit.

Despite the presence of some procedural flaws in the instant petition, such as, petitioners disregard of the hierarchy of courts and the non-exhaustion of administrative remedies, we deem it necessary to address the issues. It is in the interest of the State that questions relating to the status and existence of a public office be settled without delay.We are not without precedent. In Dario v. Mison,[12] we liberally decreed: The Court disregards the questions raised as to procedure, failure to exhaust administrative remedies, the standing of certain parties to sue, for two reasons, `[b]ecause of the demands of public interest, including the need for stability in the public service,' and because of the serious implications of these cases on the administration of the Philippine civil service and the rights of public servants. At first glance, it seems that the resolution of this case hinges on the question - Does the deactivation of EIIB constitute abolition of an office? However, after coming to terms with the prevailing law and jurisprudence, we are certain that the ultimate queries should be a) Does the President have the authority to reorganize the executive department? and, b) How should the reorganization be carried out? Surely, there exists a distinction between the words deactivate and abolish. To deactivate means to render inactive or ineffective or to break up by discharging or reassigning personnel,[13] while to abolish means to do away with, to annul, abrogate or destroy completely.[14] In essence, abolition denotes an intention to do away with the office whollyand permanently.[15] Thus, while in abolition, the office ceases to exist, the same is not true in deactivation where the office continues to exist, albeit remaining dormant or inoperative. Be that as it may, deactivation and abolition are both reorganization measures. The Solicitor General only invokes the above distinctions on the mistaken assumption that the President has no power to abolish an office. The general rule has always been that the power to abolish a public office is lodged with the legislature.[16] This proceeds from the legal precept that the power to create includes the power to destroy. A public office is either created by the Constitution, by statute, or by authority of law.[17] Thus, except where the office was created by the Constitution itself, it may be abolished by the same legislature that brought it into existence.[18] The exception, however, is that as far as bureaus, agencies or offices in the executive department are concerned, the Presidents power of control may justify him to inactivate the functions of a particular office, [19] or certain laws may grant him the broad authority to carry out reorganization measures.[20] The case in point is Larin v. Executive Secretary.[21] In this case, it was argued that there is no law which empowers the President to reorganize the BIR. In decreeing otherwise, this Court sustained the following legal basis, thus: Initially, it is argued that there is no law yet which empowers the President to issue E.O. No. 132 or to reorganize the BIR. We do not agree. xxxxxx Section 48 of R.A. 7645 provides that: Sec. 48. Scaling Down and Phase Out of Activities of Agencies Within the Executive Branch. The heads of departments, bureaus and offices and agencies are hereby directed to identify their respective activities which are no longer essential in the delivery of public services and which may be scaled down, phased out or abolished, subject to civil service rules and regulations. X x x. Actual scaling down, phasing out or abolition of the activities shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President. Said provision clearly mentions the acts of scaling down, phasing out and abolition of offices only and does not cover the creation of offices or transfer of functions.Nevertheless, the act of creating and decentralizing is included in the subsequent provision of Section 62 which provides that: Sec. 62. Unauthorized organizational charges.- Unless otherwise created by law or directed by the President of the Philippines, no organizational unit or changes in key positions in any department or agency shall be authorized in their respective organization structures and be funded from appropriations by this Act. (italics ours)

The foregoing provision evidently shows that the President is authorized to effect organizational changes including the creation of offices in the department or agency concerned. xxxxxx Another legal basis of E.O. No. 132 is Section 20, Book III of E.O. No. 292 which states: Sec. 20. Residual Powers. Unless Congress provides otherwise, the President shall exercise such other powers and functions vested in the President which are provided for under the laws and which are not specifically enumerated above or which are not delegated by the President in accordance with law. (italic ours) This provision speaks of such other powers vested in the President under the law. What law then gives him the power to reorganize? It is Presidential Decree No. 1772 which amended Presidential Decree No. 1416. These decrees expressly grant the President of the Philippines the continuing authority to reorganize the national government, which includes the power to group, consolidate bureaus and agencies, to abolish offices, to transfer functions, to create and classify functions, services and activities and to standardize salaries and materials. The validity of these two decrees are unquestionable. The 1987 Constitution clearly provides that all laws, decrees, executive orders, proclamations, letters of instructions and other executive issuances not inconsistent with this Constitution shall remain operative until amended, repealed or revoked. So far, there is yet no law amending or repealing said decrees. (Emphasis supplied) Now, let us take a look at the assailed executive order. In the whereas clause of E.O. No. 191, former President Estrada anchored his authority to deactivate EIIB on Section 77 of Republic Act 8745 (FY 1999 General Appropriations Act), a provision similar to Section 62 of R.A. 7645 quoted in Larin, thus; Sec. 77. Organized Changes. Unless otherwise provided by law or directed by the President of the Philippines, no changes in key positions or organizational units in any department or agency shall be authorized in their respective organizational structures and funded from appropriations provided by this Act. We adhere to the precedent or ruling in Larin that this provision recognizes the authority of the President to effect organizational changes in the department or agency under the executive structure. Such a ruling further finds support in Section 78 of Republic Act No. 8760.[22] Under this law, the heads of departments, bureaus, offices and agencies and other entities in the Executive Branch are directed (a) to conduct a comprehensive review of their respective mandates, missions, objectives, functions, programs, projects, activities and systems and procedures; (b) identify activities which are no longer essential in the delivery of public services and which may be scaled down, phased-out or abolished; and (c) adopt measures that will result in the streamlined organization and improved overall performance of their respective agencies.[23] Section 78 ends up with the mandate that the actual streamlining and productivity improvement in agency organization and operation shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President.[24] The law has spoken clearly. We are left only with the duty to sustain. But of course, the list of legal basis authorizing the President to reorganize any department or agency in the executive branch does not have to end here. We must not lose sight of the very source of the power that which constitutes an express grant of power. Under Section 31, Book III of Executive Order No. 292 (otherwise known as the Administrative Code of 1987), the President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have the continuing authority to reorganize the administrative structure of the Office of the President. For this purpose, he may transfer the functions of other Departments or Agencies to the Office of the President. In Canonizado v. Aguirre,[25] we ruled that reorganization involves the reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy of functions. It takes place when there is an alteration of the existing structure of government offices or units therein, including the lines of control, authority and responsibility between them. The EIIB is a bureau attached to the Department of Finance.[26] It falls under the Office of the President. Hence, it is subject to the Presidents continuing authority to reorganize. It having been duly established that the President has the authority to carry out reorganization in any branch or agency of the executive department, what is then left for us to resolve is whether or not the reorganization is valid. In this jurisdiction, reorganizations have been regarded as valid provided they are pursued in good faith. Reorganization is

carried out in good faith if it is for the purpose of economy or to make bureaucracy more efficient. [27] Pertinently, Republic Act No. 6656[28] provides for the circumstances which may be considered as evidence of bad faith in the removal of civil service employees made as a result of reorganization, to wit: (a) where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) where an office is abolished and another performing substantially the same functions is created; (c) where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) where there is a classification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices, and (e) where the removal violates the order of separation.[29] Petitioners claim that the deactivation of EIIB was done in bad faith because four days after its deactivation, President Estrada created the Task Force Aduana. We are not convinced. An examination of the pertinent Executive Orders[30] shows that the deactivation of EIIB and the creation of Task Force Aduana were done in good faith. It was not for the purpose of removing the EIIB employees, but to achieve the ultimate purpose of E.O. No. 191, which is economy. While Task Force Aduana was created to take the place of EIIB, its creation does not entail expense to the government. Firstly, there is no employment of new personnel to man the Task Force. E.O. No. 196 provides that the technical, administrative and special staffs of EIIB are to be composed of people who are already in the public service, they being employees of other existing agencies. Their tenure with the Task Force would only be temporary, i.e., only when the agency where they belong is called upon to assist the Task Force. Since their employment with the Task force is only by way of detail or assignment,they retain their employment with the existing agencies. And should the need for them cease, they would be sent back to the agency concerned. Secondly, the thrust of E.O. No. 196 is to have a small group of military men under the direct control and supervision of the President as base of the governments anti-smuggling campaign. Such a smaller base has the necessary powers 1) to enlist the assistance of any department, bureau, or office and to use their respective personnel, facilities and resources; and 2) to select and recruit personnel from within the PSG and ISAFP for assignment to the Task Force. Obviously, the idea is to encourage the utilization of personnel, facilities and resources of the already existing departments, agencies, bureaus, etc., instead of maintaining an independent office with a whole set of personnel and facilities. The EIIB had proven itself burdensome for the government because it maintained separate offices in every region in the Philippines. And thirdly, it is evident from the yearly budget appropriation of the government that the creation of the Task Force Aduana was especially intended to lessen EIIBs expenses.Tracing from the yearly General Appropriations Act, it appears that the allotted amount for the EIIBs general administration, support, and operations for the year 1995, was P128,031,000;[31] for 1996, P182,156,000;[32] for 1998, P219,889,000;[33] and, for [34] [35] 1999, P238,743,000. These amounts were far above the P50,000,000 allocation to the Task Force Aduana for the year 2000. While basically, the functions of the EIIB have devolved upon the Task Force Aduana, we find the latter to have additional new powers. The Task Force Aduana, being composed of elements from the Presidential Security Group (PSG) and Intelligence Service Armed Forces of the Philippines (ISAFP),[36] has the essential power to effect searches, seizures and arrests. The EIIB did not have this power. The Task Force Aduana has the power to enlist the assistance of any department, bureau, office, or instrumentality of the government, including government-owned or controlled corporations; and to use their personnel, facilities and resources. Again, the EIIB did not have this power. And, the Task Force Aduana has the additional authority to conduct investigation of cases involving ill-gotten wealth. This was not expressly granted to the EIIB. Consequently, it cannot be said that there is a feigned reorganization. In Blaquera v. Civil Sevice Commission, [37] we ruled that a reorganization in good faith is one designed to trim the fat off the bureaucracy and institute economy and greater efficiency in its operation. Lastly, we hold that petitioners right to security of tenure is not violated. Nothing is better settled in our law than that the abolition of an office within the competence of a legitimate body if done in good faith suffers from no infirmity. Valid abolition of offices is neither removal nor separation of the incumbents.[38] In the instructive words laid down by this Court in Dario v. Mison,[39] through Justice Abraham F. Sarmiento:

Reorganizations in this jurisdiction have been regarded as valid provided they are pursued in good faith. As a general rule, a reorganization is carried out in good faith if it is for the purpose of economy or to make bureaucracy more efficient. In that event, no dismissal (in case of dismissal) or separation actually occurs because the position itself ceases to exist. And in that case, security of tenure would not be a Chinese wall. Be that as it may, if the abolition, which is nothing else but a separation or removal, is done for political reasons or purposely to defeat security of tenure, otherwise not in good faith, no valid abolition takes and whatever abolition is done, is void ab initio. There is an invalid abolition as where there is merely a change of nomenclature of positions, or where claims of economy are belied by the existence of ample funds. Indeed, there is no such thing as an absolute right to hold office. Except constitutional offices which provide for special immunity as regards salary and tenure, no one can be said to have any vested right in an office or its salary.[40] While we cast a commiserating look upon the plight of all the EIIB employees whose lives perhaps are now torn with uncertainties, we cannot ignore the unfortunate reality that our government is also battling the impact of a plummeting economy. Unless the government is given the chance to recuperate by instituting economy and efficiency in its system, the EIIB will not be the last agency to suffer the impact. We cannot frustrate valid measures which are designed to rebuild the executive department. WHEREFORE, the petition is hereby DENIED. No costs. SO ORDERED.

[G.R. No. 152845. August 5, 2003]

DRIANITA BAGAOISAN, FELY MADRIAGA, SHIRLY TAGABAN, RICARDO SARANDI, SUSAN IMPERIAL, BENJAMIN DEMDEM, RODOLFO DAGA, EDGARDO BACLIG, GREGORIO LABAYAN, HILARIO JEREZ, and MARIA CORAZON CUANANG, petitioners, vs. NATIONAL TOBACCO ADMINISTRATION, represented by ANTONIO DE GUZMAN and PERLITA BAULA, respondents. DECISION VITUG, J.: President Joseph Estrada issued on 30 September 1998 Executive Order No. 29, entitled Mandating the Streamlining of the National Tobacco Administration (NTA), a government agency under the Department of Agriculture. The order was followed by another issuance, on 27 October 1998, by President Estrada of Executive Order No. 36, amending Executive Order No. 29, insofar as the new staffing pattern was concerned, by increasing from four hundred (400) to not exceeding seven hundred fifty (750) the positions affected thereby. In compliance therewith, the NTA prepared and adopted a new Organization Structure and Staffing Pattern (OSSP) which, on 29 October 1998, was submitted to the Office of the President. On 11 November 1998, the rank and file employees of NTA Batac, among whom included herein petitioners, filed a letter-appeal with the Civil Service Commission and sought its assistance in recalling the OSSP. On 04 December 1998, the OSSP was approved by the Department of Budget and Management (DBM) subject to certain revisions. On even date, the NTA created a placement committee to assist the appointing authority in the selection and placement of permanent personnel in the revised OSSP. The results of the evaluation by the committee on the individual qualifications of applicants to the positions in the new OSSP were then disseminated and posted at the central and provincial offices of the NTA. On 10 June 1996, petitioners, all occupying different positions at the NTA office in Batac, Ilocos Norte, received individual notices of termination of their employment with the NTA effective thirty (30) days from receipt thereof. Finding themselves without any immediate relief from their dismissal from the service, petitioners filed a petition for certiorari, prohibition and mandamus, with prayer for preliminary mandatory injunction and/or temporary restraining order, with the Regional Trial Court (RTC) of Batac, Ilocos Norte, and prayed -

1) that a restraining order be immediately issued enjoining the respondents from enforcing the notice of termination addressed individually to the petitioners and/or from committing further acts of dispossession and/or ousting the petitioners from their respective offices; 2) that a writ of preliminary injunction be issued against the respondents, commanding them to maintain the status quo to protect the rights of the petitioners pending the determination of the validity of the implementation of their dismissal from the service; and 3) that, after trial on the merits, judgment be rendered declaring the notice of termination of the petitioners illegal and the reorganization null and void and ordering their reinstatement with backwages, if applicable, commanding the respondents to desist from further terminating their services, and making the injunction permanent.[1] The RTC, on 09 September 2000, ordered the NTA to appoint petitioners in the new OSSP to positions similar or comparable to their respective former assignments. A motion for reconsideration filed by the NTA was denied by the trial court in its order of 28 February 2001. Thereupon, the NTA filed an appeal with the Court of Appeals, raising the following issues: I. Whether or not respondents submitted evidence as proof that petitioners, individually, were not the best qualified and most deserving among the incumbent applicant-employees. II. Whether or not incumbent permanent employees, including herein petitioners, automatically enjoy a preferential right and the right of first refusal to appointments/reappointments in the new Organization Structure And Staffing Pattern (OSSP) of respondent NTA. III. Whether or not respondent NTA in implementing the mandated reorganization pursuant to E.O. No. 29, as amended by E.O. No. 36, strictly adhere to the implementing rules on reorganization, particularly RA 6656 and of the Civil Service Commission Rules on Government Reorganization. IV. Whether or not the validity of E.O. Nos. 29 and 36 can be put in issue in the instant case/appeal.[2] On 20 February 2002, the appellate court rendered a decision reversing and setting aside the assailed orders of the trial court. Petitioners went to this Court to assail the decision of the Court of Appeals, contending that I. The Court of Appeals erred in making a finding that went beyond the issues of the case and which are contrary to those of the trial court and that it overlooked certain relevant facts not disputed by the parties and which, if properly considered, would justify a different conclusion; II. The Court of Appeals erred in upholding Executive Order Nos. 29 and 36 of the Office of the President which are mere administrative issuances which do not have the force and effect of a law to warrant abolition of positions and/or effecting total reorganization; III. The Court of Appeals erred in holding that petitioners removal from the service is in accordance with law; IV. The Court of Appeals erred in holding that respondent NTA was not guilty of bad faith in the termination of the services of petitioners; (and) V. The Court of Appeals erred in ignoring case law/jurisprudence in the abolition of an office.[3] In its resolution of 10 July 2002, the Court required the NTA to file its comment on the petition. On 18 November 2002, after the NTA had filed its comment of 23 September 2002, the Court issued its resolution denying the petition for failure of petitioners to sufficiently show any reversible error on the part of the appellate court in its challenged decision so as to warrant the exercise by this Court of its discretionary appellate

jurisdiction. A motion for reconsideration filed by petitioners was denied in the Courts resolution of 20 January 2002. On 21 February 2003, petitioners submitted a Motion to Admit Petition For En Banc Resolution of the case allegedly to address a basic question, i.e., the legal and constitutional issue on whether the NTA may be reorganized by an executive fiat, not by legislative action.[4] In their Petition for an En Banc Resolution petitioners would have it that 1. The Court of Appeals decision upholding the reorganization of the National Tobacco Administration sets a dangerous precedent in that: a) A mere Executive Order issued by the Office of the President and procured by a government functionary would have the effect of a blanket authority to reorganize a bureau, office or agency attached to the various executive departments; b) The President of the Philippines would have the plenary power to reorganize the entire government Bureaucracy through the issuance of an Executive Order, an administrative issuance without the benefit of due deliberation, debate and discussion of members of both chambers of the Congress of the Philippines; c) The right to security of tenure to a career position created by law or statute would be defeated by the mere adoption of an Organizational Structure and Staffing Pattern issued pursuant to an Executive Order which is not a law and could thus not abolish an office created by law; 2. The case law on abolition of an office would be disregarded, ignored and abandoned if the Court of Appeals decision subject matter of this Petition would remain undisturbed and untouched. In other words, previous doctrines and precedents of this Highest Court would in effect be reversed and/or modified with the Court of Appeals judgment, should it remain unchallenged. 3. Section 4 of Executive Order No. 245 dated July 24, 1987 (Annex D, Petition), issued by the Revolutionary government of former President Corazon Aquino, and the law creating NTA, which provides that the governing body of NTA is the Board of Directors, would be rendered meaningless, ineffective and a dead letter law because the challenged NTA reorganization which was erroneously upheld by the Court of Appeals was adopted and implemented by then NTA Administrator Antonio de Guzman without the corresponding authority from the Board of Directors as mandated therein. In brief, the reorganization is an ultra vires act of the NTA Administrator. 4. The challenged Executive Order No. 29 issued by former President Joseph Estrada but unsigned by then Executive Secretary Ronaldo Zamora would in effect be erroneously upheld and given legal effect as to supersede, amend and/or modify Executive Order No. 245, a law issued during the Freedom Constitution of President Corazon Aquino. In brief, a mere executive order would amend, supersede and/or render ineffective a law or statute.[5] In order to allow the parties a full opportunity to ventilate their views on the matter, the Court ultimately resolved to hear the parties in oral argument.Essentially, the core question raised by them is whether or not the President, through the issuance of an executive order, can validly carry out the reorganization of the NTA. Notwithstanding the apparent procedural lapse on the part of petitioner to implead the Office of the President as party respondent pursuant to Section 7, Rule 3, of the 1997 Revised Rules of Civil Procedure, [6] this Court resolved to rule on the merits of the petition. Buklod ng Kawaning EIIB vs. Zamora[7] ruled that the President, based on existing laws, had the authority to carry out a reorganization in any branch or agency of the executive department. In said case, Buklod ng Kawaning EIIB challenged the issuance, and sought the nullification, of Executive Order No. 191 (Deactivation of the Economic Intelligence and Investigation Bureau) and Executive Order No. 223 (Supplementary Executive Order No. 191 on the Deactivation of the Economic Intelligence and Investigation Bureau and for Other Matters) on the ground that they were issued by the President with grave abuse of discretion and in violation of their constitutional right to security of tenure. The Court explained: The general rule has always been that the power to abolish a public office is lodged with the legislature. This proceeds from the legal precept that the power to create includes the power to destroy. A public office is either created by the

Constitution, by statute, or by authority of law. Thus, except where the office was created by the Constitution itself, it may be abolished by the same legislature that brought it into existence. The exception, however, is that as far as bureaus, agencies or offices in the executive department are concerned, the Presidents power of control may justify him to inactivate the functions of a particular office, or certain laws may grant him the broad authority to carry out reorganization measures. The case in point is Larin v. Executive Secretary [280 SCRA 713]. In this case, it was argued that there is no law which empowers the President to reorganize the BIR. In decreeing otherwise, this Court sustained the following legal basis, thus: `Initially, it is argued that there is no law yet which empowers the President to issue E.O. No. 132 or to reorganize the BIR. `We do not agree. `x x x x x x `Section 48 of R.A. 7645 provides that: ``Sec. 48. Scaling Down and Phase Out of Activities of Agencies Within the Executive Branch. The heads of departments, bureaus and offices and agencies are hereby directed to identify their respective activities which are no longer essential in the delivery of public services and which may be scaled down, phased out or abolished, subject to civil service rules and regulations. x x x. Actual scaling down, phasing out or abolition of the activities shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President. `Said provision clearly mentions the acts of `scaling down, phasing out and abolition of offices only and does not cover the creation of offices or transfer of functions.Nevertheless, the act of creating and decentralizing is included in the subsequent provision of Section 62 which provides that: ``Sec. 62. Unauthorized organizational changes. Unless otherwise created by law or directed by the President of the Philippines, no organizational unit or changes in key positions in any department or agency shall be authorized in their respective organization structures and be funded from appropriations by this Act. `The foregoing provision evidently shows that the President is authorized to effect organizational changes including the creation of offices in the department or agency concerned. `x x x x x x `Another legal basis of E.O. No. 132 is Section 20, Book III of E.O. No. 292 which states: ``Sec. 20. Residual Powers. Unless Congress provides otherwise, the President shall exercise such other powers and functions vested in the President which are provided for under the laws and which are not specifically enumerated above or which are not delegated by the President in accordance with law. `This provision speaks of such other powers vested in the President under the law. What law then gives him the power to reorganize? It is Presidential Decree No. 1772 which amended Presidential Decree No. 1416. These decrees expressly grant the President of the Philippines the continuing authority to reorganize the national government, which includes the power to group, consolidate bureaus and agencies, to abolish offices, to transfer functions, to create and classify functions, services and activities and to standardize salaries and materials. The validity of these two decrees are unquestionable. The 1987 Constitution clearly provides that `all laws, decrees, executive orders, proclamations, letter of instructions and other executive issuances not inconsistent with this Constitution shall remain operative until amended, repealed or revoked. So far, there is yet no law amending or repealing said decrees. Now, let us take a look at the assailed executive order.

In the whereas clause of E.O. No. 191, former President Estrada anchored his authority to deactivate EIIB on Section 77 of Republic Act 8745 (FY 1999 General Appropriations Act), a provision similar to Section 62 of R.A. 7645 quoted in Larin, thus: `Sec. 77. Organized Changes. Unless otherwise provided by law or directed by the President of the Philippines, no changes in key positions or organizational units in any department or agency shall be authorized in their respective organizational structures and funded from appropriations provided by this Act. We adhere to the x x x ruling in Larin that this provision recognizes the authority of the President to effect organizational changes in the department or agency under the executive structure. Such a ruling further finds support in Section 78 of Republic Act No. 8760. Under this law, the heads of departments, bureaus, offices and agencies and other entities in the Executive Branch are directed (a) to conduct a comprehensive review of this respective mandates, missions, objectives, functions, programs, projects, activities and systems and procedures; (b) identify activities which are no longer essential in the delivery of public services and which may be scaled down, phased-out or abolished; and (c) adopt measures that will result in the streamlined organization and improved overall performance of their respective agencies. Section 78 ends up with the mandate that the actual streamlining and productivity improvement in agency organization and operation shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President. The law has spoken clearly. We are left only with the duty to sustain. But of course, the list of legal basis authorizing the President to reorganize any department or agency in the executive branch does not have to end here. We must not lose sight of the very source of the power that which constitutes an express grant of power. Under Section 31, Book III of Executive Order No. 292 (otherwise known as the Administrative Code of 1987), the President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have the continuing authority to reorganize the administrative structure of the Office of the President. For this purpose, he may transfer the functions of other Departments or Agencies to the Office of the President. In Canonizado vs. Aguirre [323 SCRA 312], we ruled that reorganization involves the reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy of functions. It takes place when there is an alteration of the existing structure of government offices or units therein, including the lines of control, authority and responsibility between them. The EIIB is a bureau attached to the Department of Finance. It falls under the Office of the President. Hence, it is subject to the Presidents continuing authority to reorganize. It having been duly established that the President has the authority to carry out reorganization in any branch or agency of the executive department, what is then left for us to resolve is whether or not the reorganization is valid. In this jurisdiction, reorganizations have been regarded as valid provided they are pursued in good faith. Reorganization is carried out in `good faith if it is for the purpose of economy or to make bureaucracy more efficient. Pertinently, Republic Act No. 6656 provides for the circumstances which may be considered as evidence of bad faith in the removal of civil service employees made as a result of reorganization, to wit: (a) where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) where an office is abolished and another performing substantially the same functions is created; (c) where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) where there is a classification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices, and (e) where the removal violates the order of separation.[8] The Court of Appeals, in its now assailed decision, has found no evidence of bad faith on the part of the NTA; thus In the case at bar, we find no evidence that the respondents committed bad faith in issuing the notices of non-appointment to the petitioners. Firstly, the number of positions in the new staffing pattern did not increase. Rather, it decreased from 1,125 positions to 750. It is thus natural that ones position may be lost through the removal or abolition of an office. Secondly, the petitioners failed to specifically show which offices were abolished and the new ones that were created performing substantially the same functions.

Thirdly, the petitioners likewise failed to prove that less qualified employees were appointed to the positions to which they applied. x x x x x x x x x. Fourthly, the preference stated in Section 4 of R.A. 6656, only means that old employees should be considered first, but it does not necessarily follow that they should then automatically be appointed. This is because the law does not preclude the infusion of new blood, younger dynamism, or necessary talents into the government service, provided that the acts of the appointing power are bonafide for the best interest of the public service and the person chosen has the needed qualifications.[9] These findings of the appellate court are basically factual which this Court must respect and be held bound. It is important to emphasize that the questioned Executive Orders No. 29 and No. 36 have not abolished the National Tobacco Administration but merely mandated its reorganization through the streamlining or reduction of its personnel. Article VII, Section 17,[10] of the Constitution, expressly grants the President control of all executive departments, bureaus, agencies and offices which may justify an executive action to inactivate the functions of a particular office or to carry out reorganization measures under a broad authority of law.[11] Section 78 of the General Provisions of Republic Act No. 8522 (General Appropriations Act of FY 1998) has decreed that the President may direct changes in the organization and key positions in any department, bureau or agency pursuant to Article VI, Section 25,[12] of the Constitution, which grants to the Executive Department the authority to recommend the budget necessary for its operation. Evidently, this grant of power includes the authority to evaluate each and every government agency, including the determination of the most economical and efficient staffing pattern, under the Executive Department. In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon. Ronaldo D. Zamora, in his capacity as the Executive Secretary, et al.,[13] this Court has had occasion to also delve on the Presidents power to reorganize the Office of the President under Section 31(2) and (3) of Executive Order No. 292 and the power to reorganize the Office of the President Proper. The Court has there observed: x x x. Under Section 31(1) of EO 292, the President can reorganize the Office of the President Proper by abolishing, consolidating or merging units, or by transferring functions from one unit to another. In contrast, under Section 31(2) and (3) of EO 292, the Presidents power to reorganize offices outside the Office of the President Proper but still within the Office of the President is limited to merely transferring functions or agencies from the Office of the President to Departments or Agencies, and vice versa. The provisions of Section 31, Book III, Chapter 10, of Executive Order No. 292 (Administrative Code of 1987), above-referred to, reads thusly: SEC. 31. Continuing Authority of the President to Reorganize his Office. The President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have continuing authority to reorganize the administrative structure of the Office of the President. For this purpose, he may take any of the following actions: (1) Restructure the internal organization of the Office of the President Proper, including the immediate Offices, the Presidential Special Assistants/Advisers System and the Common Staff Support System, by abolishing, consolidating or merging units thereof or transferring functions from one unit to another; (2) Transfer any function under the Office of the President to any other Department or Agency as well as transfer functions to the Office of the President from other Departments and Agencies; and (3) Transfer any agency under the Office of the President to any other department or agency as well as transfer agencies to the Office of the President from other departments and agencies. The first sentence of the law is an express grant to the President of a continuing authority to reorganize the administrative structure of the Office of the President. The succeeding numbered paragraphs are not in the nature of provisos that unduly limit the aim and scope of the grant to the President of the power to

reorganize but are to be viewed in consonance therewith. Section 31(1) of Executive Order No. 292 specifically refers to the Presidents power to restructure the internal organization of the Office of the President Proper, by abolishing, consolidating or merging units hereof or transferring functions from one unit to another, while Section 31(2) and (3) concern executive offices outside the Office of the President Proper allowing the President to transfer any function under the Office of the President to any other Department or Agency and vice-versa, and the transfer of any agency under the Office of the President to any other department or agency and vice-versa.[14] In the present instance, involving neither an abolition nor transfer of offices, the assailed action is a mere reorganization under the general provisions of the law consisting mainly of streamlining the NTA in the interest of simplicity, economy and efficiency. It is an act well within the authority of President motivated and carried out, according to the findings of the appellate court, in good faith, a factual assessment that this Court could only but accept.[15] In passing, relative to petitioners Motion for an En Banc Resolution of the Case, it may be well to remind counsel, that the Court En Banc is not an appellate tribunal to which appeals from a Division of the Court may be taken. A Division of the Court is the Supreme Court as fully and veritably as the Court En Banc itself and a decision of its Division is as authoritative and final as a decision of the Court En Banc. Referrals of cases from a Division to the Court En Banc do not take place as just a matter of routine but only on such specified grounds as the Court in its discretion may allow.[16] WHEREFORE, the Motion to Admit Petition for En Banc resolution and the Petition for an En Banc Resolution are DENIED for lack of merit. Let entry of judgment be made in due course. No costs. SO ORDERED.

G.R. No. 178413

March 13, 2008

AQUILINO L. PIMENTEL III, petitioner, vs. THE COMMISSION ON ELECTIONS EN BANC SITTING AS THE NATIONAL BOARD OF CANVASSERS, THE SPECIAL PROVINCIAL BOARD OF CANVASSERS FOR MAGUINDANAO CHAIRED BY ATTY. EMILIO S. SANTOS, and JUAN MIGUEL F. ZUBIRI, respondents. DECISION CHICO-NAZARIO, J.: On 4 July 2007, petitioner Aquilino L. Pimentel III (Pimentel) filed the present Petition for Certiorari and Mandamus(with Urgent Prayer for Temporary Restraining Order and/or Status Quo Ante Order).1 The Petition stemmed from the 14 May 2007 national elections for 12 senatorial posts. At the time of filing of the Petition, around two months after the said elections, the 11 candidates with the highest number of votes had already been officially proclaimed and had taken their oaths of office as Senators. With other candidates conceding, the only remaining contenders for the twelfth and final senatorial post were Pimentel and private respondent Juan Miguel F. Zubiri (Zubiri). Public respondent Commission on Elections (COMELEC) en banc, acting as the National Board of Canvassers (NBC), continued to conduct canvass proceedings so as to determine the twelfth and last Senator-elect in the 14 May 2007 elections. Pimentel assailed the proceedings before the NBC and its constituted Special Provincial Board of Canvassers for Maguindanao (SPBOC-Maguindanao) in which the Provincial and Municipal Certificates of Canvass (PCOC and MCOCs) from the province of Maguindanao were respectively canvassed. The SPBOC-Maguindanao was created because the canvass proceedings held before the original Provincial Board of Canvassers for Maguindanao (PBOC-Maguindanao), chaired by Provincial Election Supervisor (PES)

Lintang Bedol, were marred by irregularities, and the PCOC (Bedol PCOC) and other electoral documents submitted by the said PBOC-Maguindanao were tainted with fraud and statistical improbabilities. Hence, the Bedol PCOC was excluded from the national canvass then being conducted by the NBC. Task Force Maguindanao, headed by COMELEC Chairman Benjamin S. Abalos, Sr. and Commissioner Nicodemo T. Ferrer, retrieved and collected 21 MCOCs from the municipalities of Maguindanao, mostly copy 2, or the copy intended to be posted on the wall. The SPBOC-Maguindanao was then tasked to re-canvass the MCOCs submitted by Task Force Maguindanao. The re-canvassing of the Maguindanao MCOCs was conducted by the SPBOC-Maguindanao from 25 to 26 June 2007 at Shariff Aguak, Maguindanao. Although PES Bedol and the Chairpersons of the Municipal Boards of Canvassers of Maguindanao (MBOCsMaguindanao) were present during the canvass proceedings before the SPBOC-Maguindanao, the candidates’ legal counsels were not allowed to ask them any questions. Due to the consistent denial by the SPBOCMaguindanao of the repeated and persistent motions made by Pimentel’s counsel to propound questions to PES Bedol and the Chairpersons of the MBOCs-Maguindanao regarding the due execution and authenticity of the Maguindanao MCOCs, Pimentel’s counsel manifested her continuing objection to the canvassing of the said MCOCs. In particular, Pimentel’s counsel objected to the Maguindanao MCOCs because: a) the proceedings were illegal; b) the MCOCs were palpably manufactured; c) the results reflected in the MCOCs were statistically improbable; d) there is no basis for saying the MCOCs were authentic because there were no other available copies for comparison purposes; e) in most of the MCOCs[,] no watcher signed; f) there was no evidence or indication that the copy 2 MCOCs had been posted as intended by law; g) the serial numbers of the MCOCs are not clearly stamped; h) copy 2 of the MCOCs cannot be used for canvass; i) that the MCOCs are therefore, improper, unworthy and unfit for canvass; j) that the manner the "re-canvassing" which was being done where the parties are not allowed to ask questions was patently illegal; and k) that it has not been established that the other copies of the MCOCs have been lost.2 All of the foregoing observations, manifestations, and objections made by Pimentel’s counsel, as well as those made by the other candidates’ counsels, were simply noted by the SPBOC-Maguindanao without specific action thereon. On 29 June 2007, the SPBOC-Maguindanao submitted to the NBC the second PCOC for Maguindanao. In the proceedings before the NBC, Pimentel’s counsel reiterated her request to propound questions to PES Bedol and the Chairpersons of the MBOCs-Maguindanao and the SPBOC-Maguindanao. The NBC, however, refused to grant her request. Pimentel’s counsel thereafter moved for the exclusion of the second Maguindanao PCOC from the canvass, maintaining that the said PCOC did not reflect the true results of the elections because it was based on the manufactured Maguindanao MCOCs, the authenticity and due execution of which had not been duly established. The motion to exclude made by Pimentel’s counsel was once again denied by the NBC, and she was ordered to sit down or she would be forcibly evicted from the session hall. The second Maguindanao PCOC was thus included in the canvass proceedings conducted by the

NBC and, resultantly, Pimentel’s lead over Zubiri was significantly reduced from 133,000 votes to only 4,000 votes. Pimentel averred that said canvass proceedings were conducted by the NBC and SPBOC-Maguindanao in violation of his constitutional rights to substantive and procedural due process and equal protection of the laws, and in obvious partiality to Zubiri. Pimentel thus filed the Petition at bar on 4 July 2007, anchored on the following grounds: I. The petitioner [Pimentel] was denied his right to due process of law when the respondent SPBOC and the respondent NBC adopted an unconstitutional procedure which disallowed the petitioner [Pimentel] the opportunity to raise questions on the COCs subject of the canvass. II. The petitioner [Pimentel] was denied his right to equal protection of the law when the respondent SPBOC and the respondent NBC unconstitutionally adopted a procedure of "no questions" in the canvass of COCs from Maguindanao, different from the procedure adopted in the canvass of COCs from other provinces/areas. III. The respondent NBC acted with manifest grave abuse of discretion when it refused to exercise its broad, plenary powers in fully or accurately ascertaining due execution, authenticity and fitness for the canvass of the MCOCs collected by the Comelec in the exercise of such broad plenary powers. It violated its own rules when it deprived petitioner [Pimentel] of the right to ventilate and prove his objections to the Maguindanao COCs.3 Pimentel seeks from this Court the following remedies: 1. Forthwith ISSUE A TEMPORARY RESTRAINING ORDER enjoining the respondent Commission on Elections en banc sitting as the National Board of Canvassers for Senators for the May 14, 2007 elections ("NBC") from proceeding with any proclamation (of the twelfth and last winner of the May 14, 2007 Elections for Senators) based on the on-going senatorial canvass which includes the new/second Provincial Certificate of Canvass of Maguindanao, until further orders from this Court, or, in the alternative, in the event that the proclamation of Respondent Zubiri is made before the application for a TRO is acted upon, ISSUE A STATUS QUO ANTE ORDER requiring the parties to observe the status quo at the time of the filing of the Petition, in order to maintain and preserve the situation of the parties at the time of the filing of this Petition, so as not to render the issues raised in this Petition moot and academic; 2. After proper proceedings, RENDER JUDGMENT: (a) ANNULLING AND SETTING ASIDE for being unconstitutional and illegal the proceedings and acts of respondent Commission on Elections en banc sitting as the National Board of Canvassers for Senators for the May 14, 2007 elections ("NBC") of including, on June 29, 2007, in the national canvass of votes for Senators the results from the Province of Maguindanao as reflected in its new/second Provincial Certificate of Canvass as well as the proceedings and acts of the respondent Special Provincial Board of Canvassers for Maguindanao ("SPBOC") in canvassing or "re-canvassing" the collected MCOCs, on June 25, 26 and 27, 2007, leading to the preparation of the new/second PCOC for Maguindanao, and (b) COMPELLING or ORDERING respondent NBC and its deputy, the SPBOC, to perform their ministerial constitutional duty of fully determining the due execution and authenticity of the MCOCs, including, but not limited to, allowing petitioner [Pimentel] to substantiate his claim of manufactured results and propound questions to the officers concerned, primarily, the Chairpersons of the former PBOC and SPBOC of Maguindanao and the Chairpersons of the Municipal Boards of Canvassers of Maguindanao. Petitioner [Pimentel] also prays for other reliefs, just and equitable, under the premises.4 Pursuant to the Resolution5 dated 10 July 2007 issued by this Court, Zubiri filed his Comment6 on the Petition at bar on 12 July 2007; while the NBC and SPBOC-Maguindano, chaired by Atty. Emilio S. Santos, filed their

joint Comment7 on even date. The respondents Zubiri, NBC, and SPBOC-Maguindanao collectively sought the denial of Pimentel’s application for Temporary Restraining Order (TRO) and/or Status Quo Ante Order and the dismissal of the instant Petition. Pimentel’s prayer for the issuance of a TRO and/or Status Quo Ante Order was set for oral arguments on 13 July 2007. After hearing the parties’ oral arguments, the Court voted seven for the grant and seven for the denial of Pimentel’s prayer for the issuance of a TRO and/or Status Quo Ante Order; thus, said prayer was deemed denied for failure to garner the required majority vote. The parties were then directed to submit their respective Memoranda, after which, the case would be deemed submitted for resolution.8 All the parties complied, with Zubiri submitting his Memorandum9 on 31 July 2007; Pimentel,10 on 1 August 2007; and the NBC and SPBOC-Maguindanao,11 on 10 August 2007. In the meantime, without any TRO and/or Status Quo Ante Order from the Court, the canvass proceedings before the NBC continued, and by 14 July 2007, Zubiri (with 11,004,099 votes) and Pimentel (with 10,984,807 votes) were respectively ranked as the twelfth and thirteenth Senatorial candidates with the highest number of votes in the 14 May 2007 elections. Since the NBC found that the remaining uncanvassed certificates of canvass would no longer materially affect Zubiri’s lead of 19,292 votes over Pimentel, it issued Resolution No. NBC 07-67,12 dated 14 July 2007, proclaiming Zubiri as the twelfth duly elected Senator of the Philippines in the 14 May 2007 elections, to serve for a term of six years beginning 30 June 2007 in accordance with the provisions of the Constitution. On 19 July 2007, Zubiri filed with this Court a Manifestation with Motion to Dismiss.13 Zubiri sought the dismissal of the Petition at bar arguing that, in consideration of his proclamation pursuant to Resolution No. NBC 07-67 and his formal assumption of office on 16 July 2007, controversies involving his election and qualification as a Senator are now within the exclusive jurisdiction of the Senate Electoral Tribunal (SET). Zubiri further informed the Court through a Manifestation,14 dated 16 August 2007, that Pimentel filed an Election Protest (Ex Abudante Ad Cautelam) before the SET on 30 July 2007, docketed as SET Case No. 00107, to which Zubiri filed his Answer Ad Cautelam (With Special Affirmative Defenses, Counter-Protest and Petition for a Preliminary Hearing on the Affirmative Defenses) on 13 August 2007. In his election protest, Pimentel prays, among other remedies, for the annulment of Zubiri’s proclamation as the twelfth winning Senator in the 14 May 2007 elections. Zubiri called the attention of the Court to the "glaring reality" that with G.R. No. 178413 before this Court and SET Case No. 001-07 before the SET, "there are now two cases involving the same parties with practically the same issues and similar remedies sought filed before the two (2) separate courts/tribunals." Zubiri also pointed out Pimentel’s ostensible failure to inform this Court of his institution of SET Case No. 001-07 and the subsequent developments therein. On 23 August 2007, Pimentel filed before this Court his Comment/Opposition (to Private Respondent’s Manifestation with Motion to Dismiss).15 Pimentel alleged that Zubiri’s Motion to Dismiss solely relied on Aggabao v. Commission on Elections.16 However, Pimentel argued that Aggabao cannot be applied to the instant Petition because of the difference in the factual backgrounds of the two cases. In Aggabao, therein petitioner Aggabao filed his Petition before this Court after the proclamation of therein private respondent Miranda as Congressman for the Fourth District of Isabela; while in the present case, Pimentel already filed his Petition before this Court prior to the proclamation of Zubiri as Senator. Moreover, Pimentel asserted that his Petition questioned not Zubiri’s proclamation, but the conduct of the canvass proceedings before the NBC and SPBOC-Maguindanao. He maintained that his case was one of first impression and no existing jurisprudence could be used as precedent for its summary dismissal. Pimentel then reiterated his arguments in his Memorandum that Sections 37 and 38 of Republic Act No. 9369,17 amending Sections 30 and 15 of Republic Act No. 7166,18 respectively, significantly affected and changed the nature of canvass proceedings, the nature of the duty of canvassing boards, and the extent of allowable pre-proclamation controversies in Senatorial elections. Based on the foregoing, Pimentel prayed for the denial of Zubiri’s Motion to Dismiss. After a close scrutiny of the allegations, arguments, and evidence presented by all the parties before this Court, this Court rules to dismiss the present Petition. Pre-proclamation controversy/case

A pre-proclamation controversy has been defined by Batas Pambansa Blg. 881, otherwise known as the Omnibus Election Code of the Philippines, as follows: SEC. 241. Definition. – A pre-proclamation controversy is any question pertaining to or affecting the proceeding of the board of canvassers which may be raised by any candidate or by any registered political party or coalition of political parties before the board or directly with the Commission, or any matter raised under Sections 233, 234, 235 and 236 in relation to the preparation, transmission, receipt, custody and appearance of the election returns. Under Republic Act No. 7166, providing for synchronized national and local elections, pre-proclamation controversies refer to matters relating to the preparation, transmission, receipt, custody and appearance of election returns and certificates of canvass.19 Essentially reiterating Section 243 of the Omnibus Election Code, but adding the reference to the certificates of canvass, COMELEC Resolution No. 7859, dated 17 April 2007, identified the issues that may be subject of a pre-proclamation controversy, to wit: SEC. 37. Issues that may be raised in pre-proclamation controversy. – The following shall be proper issues that may be raised in a pre-proclamation controversy: 1) Illegal composition or proceedings of the Board of Canvassers; 2) The canvassed election returns/certificates of canvass are incomplete, contain material defects, appear to be tampered with or falsified, or contain discrepancies in the same returns/certificates or in the other authentic copies thereof as mentioned in Sections 233, 234, 235 and 236 of the Omnibus Election Code; 3) The election returns/certificates of canvass were prepared under duress, threats, coercion, or intimidation, or they are obviously manufactured or not authentic; and 4) When substitute or fraudulent election return/certificates of canvass were canvassed, the results of which materially affected the standing of the aggrieved candidate or candidates. Pre-proclamation cases to resolve pre-proclamation controversies are allowed in local elections. According to Section 16 of Republic Act No. 7166: SEC. 16. Pre-proclamation Cases Involving Provincial, City and Municipal Offices. – Pre-proclamation cases involving provincial, city and municipal officer shall be allowed and shall be governed by Sections 17, 18, 19, 20, 21 and 22 hereof. All pre-proclamation cases pending before the Commission shall be deemed terminated at the beginning of the term of the office involved and the rulings of the boards of canvassers concerned shall be deemed affirmed, without prejudice to the filing of a regular election protest by the aggrieved party. However, proceedings may continue when on the basis of the evidence thus far presented, the Commission determines that the petition appears meritorious and accordingly issues an order for the proceeding to continue or when an appropriate order has been issued by the Supreme Court in a petition for certiorari. SEC. 17. Pre-proclamation Controversies: How Commenced. – Questions affecting the composition or proceedings of the board of canvassers may be initiated in the board or directly with the Commission. However, matters raised under Sections 233, 234, 235 and 236 of the Omnibus Election Code in relation to the preparation, transmission, receipt, custody and appreciation of the election returns, and the certificates of canvass shall be brought in the first instance before the board of canvassers only.

However, as to elections for President, Vice-President, Senators, and Members of the House of Representatives, pre-proclamation cases are prohibited. Section 15 of Republic Act No. 7166, prior to its amendment, read: SEC. 15. Pre-proclamation Cases Not Allowed in Elections for President, Vice-President, Senator, and Member of the House of Representatives. – For purposes of the elections for President, Vice-President, Senator, and Member of the House of Representatives, no pre-proclamation cases shall be allowed on matters relating to the preparation, transmission, receipt, custody and appreciation of the election returns or the certificates of canvass, as the case may be. However, this does not preclude the authority of the appropriate canvassing body motu propio or upon written complaint of an interested person to correct manifest errors in the certificate of canvass or election returns before it. Questions affecting the composition or proceedings of the board of canvassers may be initiated in the board or directly with the Commission in accordance with Section 19 hereof. Any objection on the election returns before the city or municipal board of canvassers, or on the municipal certificates of canvass before the provincial board of canvassers or district boards of canvassers in Metro Manila Area, shall be specifically noted in the minutes of their respective proceedings. As Section 15 of Republic Act No. 7166 was then worded, it would appear that any pre-proclamation case relating to the preparation, transmission, receipt, custody and appreciation of election returns or certificates of canvass, was prohibited in elections for President, Vice-President, Senators and Members of the House of Representatives. The prohibition aims to avoid delay in the proclamation of the winner in the election, which delay might result in a vacuum in these sensitive posts. Proceedings which may delay the proclamation of the winning candidate beyond the date20 set for the beginning of his term of office must be avoided, considering that the effect of said delay is, in the case of national offices for which there is no hold over, to leave the office without any incumbent.21 The law, nonetheless, recognizes an exception and allows the canvassing body motu proprio or an interested person to file a written complaint for the correction of manifest errors in the election returns or certificates of canvass even in elections for President, Vice-President, Senators and Members of the House of Representatives, for the simple reason that the correction of manifest error will not prolong the process of canvassing nor delay the proclamation of the winner in the election.22 To be manifest, the errors must appear on the face of the certificates of canvass or election returns sought to be corrected and/or objections thereto must have been made before the board of canvassers and specifically noted in the minutes of their respective proceedings.23 The law likewise permits pre-proclamation cases in elections for President, Vice-President, Senators and Members of the House of Representatives, when these cases question the composition or proceedings of the board of canvassers before the board itself or the COMELEC, since such cases do not directly relate to the certificate of canvass or election returns. Section 15 of Republic Act No. 7166, after the amendment introduced by Republic Act No. 9369, now reads: SEC. 15. Pre-proclamation Cases in Elections for President, Vice-President, Senator, and Member of the House of Representatives. – For purposes of the elections for president, vice-president, senator, and member of the House of Representatives, no pre-proclamation cases shall be allowed on matters relating to the preparation, transmission, receipt, custody and appreciation of election returns or the certificates of canvass, as the case may be, except as provided for in Section 30 hereof. However, this does not preclude the authority of the appropriate canvassing body motu propio or upon written complaint of an interested person to correct manifest errors in the certificate of canvass or election returns before it. Questions affecting the composition or proceedings of the board of canvassers may be initiated in the board or directly with the Commission in accordance with Section 19 hereof.

Any objection on the election returns before the city or municipal board of canvassers, or on the municipal certificates of canvass before the provincial board of canvassers or district board of canvassers in Metro Manila Area, shall be specifically noticed in the minutes of their respective proceedings. (Emphasis supplied.) Republic Act No. 9369 significantly amended Section 15 of Republic Act No. 7166 by adding an excepting phrase to the general prohibition against pre-proclamation controversies in elections for President, VicePresident, Senators and Members of the House of Representatives. According to the amended Section 15, no pre-proclamation cases on matters relating to the preparation, transmission, receipt, custody and appreciation of election returns or the certificates of canvass shall be allowed in elections for President, Vice-President, Senators and Members of the House of Representatives, except as provided by Section 30 of the same statute. Section 30 of Republic Act No. 7166, which was likewise amended by Republic Act No. 9369, provides: SEC. 30. Congress as the National Board of Canvassers for the Election of President and Vice President: The Commission en banc as the National Board of Canvassers for the election of senators:Determination of Authenticity and Due Execution of Certificates of Canvass. – Congress and the Commission en banc shall determine the authenticity and due execution of the certificate of canvass for president and vice-president and senators, respectively, as accomplished and transmitted to it by the local board of canvassers, on a showing that: (1) each certificate of canvass was executed, signed and thumbmarked by the chairman and members of the board of canvassers and transmitted or caused to be transmitted to Congress by them; (2) each certificate of canvass contains the names of all of the candidates for president and vice-president or senator, as the case may be, and their corresponding votes in words and figures; (3) there exists no discrepancy in other authentic copies of the certificates of canvass or in any of its supporting documents such as statement of votes by city/municipality/by precinct or discrepancy in the votes of any candidate in words and figures in the certificate; and (4) there exists no discrepancy in the votes of any candidate in words and figures in the certificate of canvass against the aggregate number of votes appearing in the election returns of precincts covered by the certificate of canvass: Provided, That certified print copies of election returns or certificates of canvass may be used for the purpose of verifying the existence of the discrepancy. When the certificate of canvass, duly certified by the board of canvassers of each province, city or district, appears to be incomplete the Senate President or the Chairman of the Commission, as the case may beshall require the board of canvassers concerned to transmit by personal delivery the election returns from polling places that were not included in the certificate of canvass and supporting statements. Said election returns shall be submitted by personal delivery within two (2) days from receipt of notice. When it appears that any certificate of canvass or supporting statement of votes by city/municipality or by precinct bears erasures or alterations which may cast doubt as to the veracity of the number of votes stated herein and may affect the result of the election, upon request of the presidential, vicepresidential or senatorial candidate concerned or his party, Congress or the Commission en banc, as the case may be, shall, for the sole purpose of verifying the actual number of votes cast for President and Vice-President or senator, count the votes as they appear in the copies of the election returns submitted to it. In case of any discrepancy, incompleteness, erasure or alteration as mentioned above, the procedure on pre-proclamation controversies shall be adopted and applied as provided in Sections 17, 18, 19 and 20. Any person who presents in evidence a simulated copy of an election return, certificate of canvass or statement of votes, or a printed copy of an election return, certificate of canvass or statement of votes bearing a simulated certification or a simulated image, shall be guilty of an

election offense and shall be penalized in accordance with Batas Pambansa Blg. 881. (Emphasis supplied.) The highlighted portions in the afore-quoted section identify the amendments introduced by Republic Act No. 9369, specifically: (1) the duty to determine the authenticity and due execution of certificates of canvass is now imposed, not only on Congress acting as the NBC for the election for President and Vice-President, but also on COMELEC en banc acting as the NBC for the election for Senators; (2) the third criterion for the determination of the authenticity and due execution of the certificates of canvass requires the absence of discrepancy in comparison not only with other authentic copies of the said certificates, but also with the supporting documents, such as the statements of votes; (3) a fourth criterion for the determination of the authenticity and due execution of the certificates of canvass was added, mandating the absence of discrepancy between the number of votes of a candidate in a certificate when compared with the aggregate number of votes appearing in the election returns of the precincts covered by the same certificate; (4) pursuant to the exception now provided in Section 15 of Republic Act No. 7166, as amended by Republic Act No. 9369, permissible preproclamation cases shall adopt and apply the procedure provided in Sections 17 to 20 of the same statute; and (5) the use of a simulated copy of an election return, certificate of canvass, or statement of vote, or a printed copy of said election documents bearing a simulated certification or image shall be penalized as an election offense. Indeed, this Court recognizes that by virtue of the amendments introduced by Republic Act No. 9369 to Sections 15 and 30 of Republic Act No. 7166, pre-proclamation cases involving the authenticity and due execution of certificates of canvass are now allowed in elections for President, Vice-President, and Senators. The intention of Congress to treat a case falling under Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, as a pre-proclamation case is apparent in the fourth paragraph of the said provision which adopts and applies to such a case the same procedure provided under Sections 17,24 18,25 1926 and 2027 of Republic Act No. 7166 on pre-proclamation controversies. In sum, in elections for President, Vice-President, Senators and Members of the House of Representatives, the general rule still is that pre-proclamation cases on matters relating to the preparation, transmission, receipt, custody and appreciation of election returns or certificates of canvass are still prohibited. As with other general rules, there are recognized exceptions to the prohibition, namely: (1) correction of manifest errors; (2) questions affecting the composition or proceedings of the board of canvassers; and (3) determination of the authenticity and due execution of certificates of canvass as provided in Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369. The Petition at bar Pimentel’s objections to the Maguindanao MCOCs delve into "matters relating to the preparation, transmission, receipt, custody and appreciation" of the said MCOCs by the SPBOC-Maguindanao. He suspects the authenticity and due execution of the Maguindanao MCOCs used by the SPBOC-Maguindanao in its canvass, which were mostly copy 2 or the copy for the wall,28 because of the supposed mysterious circumstances surrounding the loss or unavailability of any other copy of the said MCOCs. He decries the denial by the SPBOC-Maguindanao and the NBC of the opportunity to question PES Bedol and the Chairpersons of the MBOCs-Maguindanao on "where did that copy 2 come from, what was the basis, when was it accomplished, how was it posted x x x";29 and to substantiate his claim that the Maguindanao MCOCs are palpably manufactured and are not fit for canvass.30 He is raising issues related to the tampering with, falsification of, or discrepancies in the Maguindanao MCOCs, which are properly the subject of a pre-proclamation controversy.31 Pimentel insists that the SPBOC-Maguindanao and the NBC should hear his observations, accept his evidence, and rule on his objections to the Maguindanao MCOCs in what would undeniably be a pre-proclamation case. Ultimately, what Pimentel seeks is that his pre-proclamation case be given due course by the boards of canvassers. Respondents contend that Pimentel cannot initiate and pursue a pre-proclamation case before the SPBOCMaguindanao or the NBC, since such a case is prohibited in elections for Senators. Pimentel, however, argues

that his pre-proclamation case is an exception to the prohibition pursuant to Section 30, in relation to Section 15, of Republic Act No. 7166, as amended by Republic Act No. 9369. This Court rules for the respondents. Proceedings before the SPBOC-Maguindanao The SPBOC-Maguindanao, in the conduct of its canvass proceedings, properly refused to allow Pimentel to contest the Maguindanao MCOCs at that stage by questioning PES Bedol and the Chairpersons of the MBOCs-Maguindanao and presenting evidence to prove the alleged manufactured nature of the said MCOCs, for such would be tantamount to a pre-proclamation case still prohibited by Section 15 of Republic Act No. 7166, even after its amendment by Republic Act No. 9369. The SPBOC-Maguindanao, as its name suggests, was constituted to be of the same stature and to perform the same function as the PBOC-Maguindano: to canvass the Maguindanao MCOCs and prepare the Maguindanao PCOC to be submitted to the NBC. Undeniably, the SPBOC-Maguindanao is not Congress nor COMELEC en banc acting as the NBC, specifically charged by Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, with the duty to determine the authenticity and due execution of the certificates of canvass submitted to it in accordance with the four given criteria. There is no ambiguity in the said provision, at least, as to whom it imposes the duty, namely: (1) Congress as the NBC for the election for President and Vice-President; and (2) COMELEC en banc as the NBC for the election for Senators. This is a case where the law is clear. It speaks in a language that is categorical. It is quite explicit; it is too plain to be misread. No interpretation is needed. All that is called for is to apply the statutory command.32 Even if there is still a need for this Court to construe Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, it still cannot extend the scope of said provision to local boards of canvassers. A preproclamation case under Section 30 is allowed only as an exception to the prohibition under Section 15 of Republic Act No. 7166, as amended by Republic Act No. 9369. According to the rules of statutory construction, exceptions, as a general rule, are strictly, but reasonably construed; they extend only so far as their language fairly warrants, and all doubts should be resolved in favor of the general provisions rather than the exception. Where a general rule is established by statute with exceptions, the court will not curtail the former nor add to the latter by implication.33 A maxim of recognized practicality is the rule that the expressed exception or exemption excludes others. Exceptio firmat regulim in casibus non exceptis. The express mention of exceptions operates to exclude other exceptions; conversely, those which are not within the enumerated exceptions are deemed included in the general rule.34 And, in this case, the exception applies only to Congress or the COMELEC en banc acting as the NBC, and not to local boards of canvassers who must still be deemed covered by the prohibition on pre-proclamation controversies. It is also significant to note that Section 15 of Republic Act No. 7166, as amended by Republic Act No. 9369, prohibits pre-proclamation cases in elections for President, Vice-President, Senators, and Members of the House of Representatives; while Section 30 of the same statute, as amended, refers only to elections for President, Vice-President and Senators. The intent of the Legislature to confine the application of Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, only to Congress or the COMELEC en banc acting as the NBC thus becomes even more evident, considering that the said provision does not apply to elections for Members of the House of Representatives. It must be borne in mind that only the votes for national elective positions such as the President, Vice-President, and Senators are canvassed by the NBC. The canvassing of votes for local elective positions, including those for Members of the House of Representatives, end with the local boards of canvassers. Therefore, it would be contrary to the legislative intent to extend Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, even to the canvass proceedings before local boards of canvassers. This Court can only conclude that the canvass proceedings before local boards of canvassers in elections for Senators are unaffected by the amendment of Republic Act No. 7166 by Republic Act No. 9369. They still remain administrative and summary in nature, so as to guard against the paralyzation of canvassing and proclamation proceedings that would lead to a vacuum in so important and sensitive office as that of Senator of the Republic.35

For the same reasons stated in the preceding paragraphs, the four criteria enumerated by Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, are not mandatory on local boards of canvassers in their determination of authenticity and due execution of the certificates of canvass submitted to them. It is already well-settled that the local boards of canvassers, as well as the SPBOC-Maguindanao in this case, may proceed with the canvassing of the election returns or certificates of canvass for as long as they appear to be authentic and duly accomplished on their face.36 Boards of canvassers are ad hoc bodies that exist only for the interim task of canvassing election returns. They do not have the facilities, the time and even the competence to hear, examine and decide on alleged election irregularities, unlike regular courts or the COMELEC itself or the electoral tribunals (Presidential, Senate, and House), which are regular agencies of government tasked and equipped for the purpose. While this Court has time and again expressed its abhorrence of the nefarious "grab the proclamation and prolong the protest" strategy of some candidates, nonetheless, it recognizes the very limited jurisdiction of MBOCs and PBOCs. Unless Pimentel is able to show cogently and clearly his entitlement to the summary exclusion of clearly unacceptable certificates of canvass, this Court must uphold the constitutional and legal presumption of regularity in the performance of official functions and authenticity of official documents. 37 The burden is upon Pimentel to establish that the Maguindanao MCOCs are manufactured, and that it is evident on the face thereof. Pimentel’s insistence on being allowed to propound questions to PES Bedol and the Chairpersons of the MBOCs-Maguindanao and SPBOC-Maguindanao reveals that, although he has his suspicions, he has yet no actual evidence that the Maguindanao MCOCs were indeed manufactured. Moreover, Pimentel’s main objection to the Maguindanao MCOCs used in the canvass by the SPBOCMaguindanao is that they are mostly copy 2 or the copy intended to be posted on the wall. According to Section 43 of COMELEC Resolution No. 7859, dated 17 April 2007, the MBOCs must transmit copy 1 of the MCOCs to the PBOC for use in the provincial canvassing of votes. The SPBOC-Maguindanao was compelled to use copy 2 of the Maguindanao MCOCs in the absence of copy 1 thereof. The fact that copy 2 of the Maguindanao MCOCs was not the copy meant for the PBOC-Maguindanao does not necessarily mean that copy 2 of the said MCOCs was manufactured, falsified or tampered with. All the seven copies of the MCOCs required to be prepared by the MBOCs should be considered duplicate originals.38 Just like copy 1 of the MCOCs, copy 2 should be afforded the presumption of authenticity as an official document prepared by the MBOCs-Maguindanao in the regular performance of their official functions. Copy 2 is no less authentic than all the other copies of the MCOCs although it may be more susceptible to manufacture, falsification, or tampering. If the manufacture, falsification, or tampering of copy 2 of the MCOCs is not apparent on its face, the burden to prove the same falls on the candidate making the allegation in a regular election protest. At least as far as the proceedings before the local boards of canvassers are concerned, this Court’s ruling in Pangarungan v. Commission on Elections39 still holds true: it is not required that all the other copies of the election returns or certificates of canvass be taken into account and compared with one another before one of them, determined to be authentic, may be used or included in the canvass. The SPBOC-Maguindanao determined that copy 2 of the Maguindanao MCOCs is authentic and duly executed on its face, while Pimentel insists otherwise. This issue involves the appreciation of copy 2 of the Maguindanao MCOCs by the SPBOC-Maguindanao, the proper subject of a pre-proclamation controversy, which, as this Court already declared, is still prohibited in proceedings before local boards of canvassers for elections for Senators. The resolution of the issues raised by Pimentel as to the irregularities and suspicious circumstances surrounding the Maguindanao MCOCs, which appear prima facie regular on their face, compels or necessitates the piercing of the veil of the said MCOCs. These issues, however, are more appropriate in a regular election protest, wherein the parties may litigate all the legal and factual issues raised by them in as much detail as they may deem necessary or appropriate.40 Proceedings before the COMELEC en banc acting as the NBC for elections for Senators Similarly, the COMELEC en banc acting as the NBC for the election for Senators, did not violate Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, when it denied Pimentel’s request to question

PES Bedol and the Chairpersons of the MBOCs-Maguindanao and SPBOC-Maguindanao, and his subsequent motion to exclude the second Maguindanao PCOC. As already declared by this Court, the NBC has the duty to determine the authenticity and due execution of the certificates of canvass submitted to it in accordance with the four criteria enumerated in Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369. It has not been established to the satisfaction of this Court that the NBC failed to comply with its duty under said provision. Pimentel asserts that in the absence of all the other copies of the Maguindanao MCOCs, except copy 2, there is no way to apply the third criterion under Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369. According to this criterion for authenticity and due execution of a certificate of canvass, there must exist no discrepancy in other authentic copies of the certificate or in any of its supporting documents such as the statement of votes by city/municipality/precinct and no discrepancy in the votes of any candidate in words and figures in the certificate. Pimentel posits that without any other copies available for comparison, then copy 2 of the Maguindanao MCOCs cannot be deemed authentic and duly executed. While it is true that having only one copy of the certificate of canvass may raise problems as to the determination by the NBC of its authenticity and due execution since there are no other copies to compare it with, such is not the situation in the Petition at bar. According to Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, Congress and the COMELEC en banc, acting as the NBC, shall determine the authenticity and due execution of the certificates of canvass for President, Vice-President and Senators, respectively, as accomplished and transmitted to them by the local boards of canvassers. For the province of Maguindanao, it is the PBOC which transmits the PCOC to the NBC. For the 14 May 2007 senatorial elections, the NBC excluded from the national canvass the Bedol PCOC submitted by the PBOC-Maguindanao after it found the same to be tainted by irregularities and statistical improbabilities. Thereafter, the SPBOC-Maguindanao was created, which re-canvassed the Maguindanao MCOCs and prepared and submitted to the NBC the second Maguindanao PCOC. Hence, the four criteria enumerated in Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369, must be applied by the NBC to the second Maguindanao PCOC. The authenticity and due execution of the Maguindanao MCOCs, which had already been determined by the SPBOC-Maguindanao, are no longer in issue before the NBC. To allow Pimentel to revive again before the NBC the issue of authenticity and due execution of the Maguindanao MCOCs after a determination thereof by the SPBOC-Maguindanao is like granting him an appeal, a remedy which is without any statutory or regulatory basis. The SPBOC-Maguindanao prepared all seven copies of the second Maguindanao PCOC. It properly submitted the first copy to the NBC for national canvassing of the votes for Senators. All the six other copies are in existence and have been distributed to the intended recipients. There is no allegation or proof that there is a discrepancy among the seven authentic copies of the second Maguindanao PCOC. Neither is it shown that the second Maguindanao PCOC contains any discrepancy when compared with its supporting documents. It would thus appear to this Court that the second Maguindanao PCOC passed the third criterion for its authenticity and due execution as provided in Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369. As for the three other criteria, there is no sufficient allegation, much less proof, that the NBC did not apply them to the second Maguindanao PCOC or that the second Maguindanao PCOC actually failed to meet any of them. Given the foregoing, there is indeed no merit in Pimentel’s request before the NBC to still question PES Bedol and the Chairpersons of the MBOCs-Maguindanao and SPBOC-Maguindanao regarding the Maguindanao MCOCs. There is also no reason to exclude the second Maguindanao PCOC from the national canvass of votes for Senators after its authenticity and due execution had been determined by the NBC in accordance with the criteria provided by the law. Due process and equal protection of the law

Pimentel alleges that the proceedings before the NBC and the SPBOC-Maguindanao disallowing him from asking certain election officials, such as PES Bedol and the Chairpersons of the MBOCs-Maguindanao and SPBOC-Maguindanao, questions regarding the Maguindanao PCOC and MCOCs, deprived him of his right to due process. In City of Manila v. Hon. Laguio, Jr.,41 this Court already provided a discourse on due process, to wit: The constitutional safeguard of due process is embodied in the fiat "(N)o person shall be deprived of life, liberty or property without due process of law x x x." There is no controlling and precise definition of due process. It furnishes though a standard to which governmental action should conform in order that deprivation of life, liberty or property, in each appropriate case, be valid. This standard is aptly described as a responsiveness to the supremacy of reason, obedience to the dictates of justice, and as such it is a limitation upon the exercise of the police power. The purpose of the guaranty is to prevent governmental encroachment against the life, liberty and property of individuals; to secure the individual from the arbitrary exercise of the powers of the government, unrestrained by the established principles of private rights and distributive justice; to protect property from confiscation by legislative enactments, from seizure, forfeiture, and destruction without a trial and conviction by the ordinary mode of judicial procedure; and to secure to all persons equal and impartial justice and the benefit of the general law. The guaranty serves as a protection against arbitrary regulation, and private corporations and partnerships are "persons" within the scope of the guaranty insofar as their property is concerned. This clause has been interpreted as imposing two separate limits on government, usually called "procedural due process" and "substantive due process." Procedural due process, as the phrase implies, refers to the procedures that the government must follow before it deprives a person of life, liberty, or property. Classic procedural due process issues are concerned with what kind of notice and what form of hearing the government must provide when it takes a particular action. Substantive due process, as that phrase connotes, asks whether the government has an adequate reason for taking away a person’s life, liberty, or property. In other words, substantive due process looks to whether there is a sufficient justification for the government’s action. Case law in the United States (U.S.) tells us that whether there is such a justification depends very much on the level of scrutiny used. For example, if a law is in an area where only rational basis review is applied, substantive due process is met so long as the law is rationally related to a legitimate government purpose. But if it is an area where strict scrutiny is used, such as for protecting fundamental rights, then the government will meet substantive due process only if it can prove that the law is necessary to achieve a compelling government purpose. This Court finds Pimentel’s argument of deprivation of due process problematic since he has not established what he is being deprived of: life, liberty, or property. He was a candidate in the senatorial elections. At the time he filed the instant Petition, he might have been leading in the canvassing of votes, yet the canvass proceedings were still ongoing, and no winner for the twelfth and last senatorial post had been proclaimed. May he already claim a right to the elective post prior to the termination of the canvass proceedings and his proclamation as winner, and may such a right be considered a property right which he cannot be deprived of without due process? These were clearly substantial and weighty issues which Pimentel did not address. Unfortunately, this Court cannot argue and settle them for him. Pimentel only made a sweeping claim that in the canvass proceedings of the Maguindanao votes before the NBC and the SPBOC-Maguindanao, he was deprived of his constitutional right to due process, both procedural

and substantive. After going over his allegations, however, and the definition of substantive due process, this Court finds that Pimentel cannot invoke denial of substantive due process because he is not assailing any law, which, arbitrarily or without sufficient justification, supposedly deprived him of life, liberty, or property. At most, Pimentel can claim that he was denied procedural due process when he was not allowed by the NBC and the SPBOC-Maguindanao to propound questions to certain election officials. But even on this point, Pimentel fails to convince this Court. Asking election officials questions and confronting them with evidence are not part of the canvass proceedings. There is no statute or regulation expressly providing for such a procedure. Any objection or manifestation concerning a certificate of canvass before the NBC, as well as any contest involving the inclusion or exclusion of an election return or certificate of canvass before a local board of canvassers, must be orally submitted to the Chairperson of the NBC or the local board of canvassers, as the case may be. Simultaneous with the oral submission, the party concerned must submit his written objection, manifestation, or contest in the form required. The objection, manifestation, or contest shall also be recorded in the minutes of the canvass. In the event that the NBC or local board of canvassers shall determine that there is a proper case for the objection, manifestation, or contest submitted, it shall automatically defer the canvass of the assailed election return or certificate of canvass. Within 24 hours from the submission of the objection, manifestation, or contest, the party concerned shall submit his evidence which shall be attached to his written objection, manifestation, or contest. Within the same 24-hour period, any party may file a written and verified opposition to the objection, manifestation, or contest. Upon receipt of the evidence, the NBC or the local board of canvassers shall take up the assailed election return or certificate of canvass, and after considering the objection, manifestation or contest, together with the opposition thereto and the evidences submitted, shall summarily and immediately rule thereon.42 The afore-described procedure does not provide any party the opportunity to question and confront election officials and other witnesses. It may have been allowed on occasion by the boards of canvassers, but it does not necessarily ripen into a legally demandable right. Again, canvass proceedings are administrative and summary in nature. As for local boards of canvassers, in elections for Senators, they only need to determine the authenticity and due execution of the election returns or certificates of canvass on the face thereof. As for the COMELEC en banc, acting as the NBC, the determination of the authenticity and due execution of the certificates of canvass shall be limited only to those submitted before it by the local boards of canvassers and in accordance with the criteria provided in Section 30 of Republic Act No. 7166, as amended by Republic Act No. 9369. The limitations on the powers and duties of the boards of canvassers are meant to avoid any delay in the proclamation of the elected official. Issues whose resolution would require the presentation and examination of witnesses are more properly raised in a regular election protest. And as a final observation on the matter of due process, this Court notes that although Pimentel was not able to propound questions to the election officials involved in the preparation and canvassing of the Maguindanao MCOCs and PCOC, he was still able, through his counsel, to state his observations, manifestations, and objections regarding the said certificates, which were duly noted.43 He may not have received the response or action that he wanted with respect to his observations, manifestations, and objections, but Pimentel cannot deny that these were heard and presented in the canvass proceedings. Pimentel further admitted that he did not submit his written observations, manifestations, and objections as the rules of procedure before the NBC and the local boards of canvassers require.44 He cannot now decry that his observations, manifestations, and objections were not given due course when he himself failed to comply with the procedure governing the same. Equally baseless is Pimentel’s averment that his right to equal protection of the laws was violated when the NBC and the SPBOC-Maguindanao adopted a procedure of "no questions" in the canvass of the Maguindanao MCOCs, different from the procedure adopted in the canvass of the certificates of canvass from other provinces/areas. Article III, Section 1 of the 1987 Constitution guarantees that no person shall be denied equal protection of the laws. According to a long line of decisions, equal protection simply requires that all persons or things similarly situated should be treated alike, both as to rights conferred and responsibilities imposed. Similar subjects, in other words, should not be treated differently, so as to give undue favor to some and unjustly discriminate against others.45According to Pimentel, he was deprived of equal protection of the laws when he was not allowed to question the election officials involved in the canvass proceedings for Maguindanao, although he was allowed to do so for other provinces or districts. In support of his claim,

Pimentel compared his own experiences in the canvass proceedings for different provinces or districts. This Court, however, finds Pimentel’s assessment misplaced. What would have been essential for Pimentel to allege and prove was that other senatorial candidates were allowed during the canvass proceedings to question the election officials involved in the preparation and canvassing of the Maguindanao MCOCs and PCOC, while he was not; and that the other senatorial candidates were given undue favor, while he was the only one unjustly discriminated against. It seems apparent to this Court that the position of the SPBOCMaguindanao and the NBC not to allow, during the canvass proceedings, the questioning of election officials involved in the preparation and canvassing of the Maguindanao MCOCs and PCOC, was consistent for all senatorial candidates. Hence, petitioner was similarly situated with all the other senatorial candidates and they were all treated alike insofar as the canvass proceedings for Maguindanao were concerned. Electoral protest before the Senate Electoral Tribunal (SET) Pimentel’s Petition is for Certiorari and Mandamus, both governed by Rule 65 of the Rules of Court. A special civil action for certiorari may be filed under the following circumstances: SECTION 1. Petition for certiorari. – When any tribunal, board or officer exercising judicial or quasijudicial functions has acted without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, or any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered annulling or modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefs as law and justice may require. In a special civil action for certiorari, the burden is on the part of petitioner to prove not merely reversible error, but grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the public respondent issuing the impugned order. Grave abuse of discretion means a capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. Mere abuse of discretion is not enough, it must be so grave as when the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility, and must be so patent and so gross as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation of law.46 The extraordinary remedy of mandamus, on the other hand, may be availed of under the conditions provided below: RULE 65, SECTION 3. Petition for mandamus. – When any tribunal, corporation, board, officer or person unlawfully neglects the performance of an act which the law specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes another from the use and enjoyment of a right or office to which such other is entitled, and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent, immediately or at some other time to be specified by the court, to do the act required to be done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful acts of the respondent. The writ of mandamus shall be issued only if the legal right to be enforced is well defined, clear and certain. It lies only to compel an officer to perform a ministerial duty, not a discretionary one. The duty is ministerial only when its discharge requires neither the exercise of official discretion nor judgment.47 To avail of both special civil actions, there must be no other plain, speedy and adequate remedy in the ordinary course of law available to the petitioner, and in this, Pimentel’s Petition falters.

It must be kept in mind that Zubiri was proclaimed the twelfth Senator-elect in the 14 May 2007 elections on 14 July 2007, and that he formally assumed office on 16 July 2007. In accordance with this Court’s ruling in Aggabao, Pimentel’s Petition must be dismissed, for his recourse lies, not with this Court, but with the SET. This Court elucidated in Aggabao48 that: Article VI, Section 17 of the 1987 Constitution provides: Sec. 17. The Senate and the House of Representatives shall each have an Electoral Tribunal which shall be the sole judge of all contests relating to the election, returns, and qualifications of their respective Members. Each Electoral Tribunal shall be composed of nine Members, three of whom shall be Justices of the Supreme Court to be designated by the Chief Justice, and the remaining six shall be Members of the Senate or the House of Representatives, as the case may be, who shall be chosen on the basis of proportional representation from the political parties and the parties or organization registered under the party-list system represented therein. The senior Justice in the Electoral Tribunal shall be its Chairman. In Pangilinan v. Commission on Elections we ruled that: The Senate and the House of Representatives now have their respective Electoral Tribunals which are the "sole judge of all contests relating to the election, returns, and qualifications of their respective Members, thereby divesting the Commission on Elections of its jurisdiction under the 1973 Constitution over election cases pertaining to the election of the Members of the Batasang Pambansa (Congress). It follows that the COMELEC is now bereft of jurisdiction to hear and decide pre-proclamation controversies against members of the House of Representatives as well as of the Senate. The HRET has sole and exclusive jurisdiction over all contests relative to the election, returns, and qualifications of members of the House of Representatives. Thus, once a winning candidate has been proclaimed, taken his oath, and assumed office as a Member of the House of Representatives, COMELEC’s jurisdiction over election contests relating to his election, returns, and qualifications ends, and the HRET’s own jurisdiction begins. It is undisputed that Miranda has already been proclaimed, taken his oath and assumed office on June 14, 2004. As such, petitioner’s recourse would have been to file an electoral protest before the HRET. His remedy is not this petition for certiorari. Thus: Finally, the private respondent Feliciano Belmonte, Jr. has already been proclaimed as the winner in the congressional elections in the fourth district of Quezon City. He has taken his oath of office and assumed his duties as representative; hence, the remedy open to the petitioner was to have filed an electoral protest with the Electoral Tribunal of the House of Representatives. The allegation that Miranda’s proclamation is null and void ab initio does not divest the HRET of its jurisdiction. Thus: (I)n an electoral contest where the validity of the proclamation of a winning candidate who has taken his oath of office and assumed his post as Congressman is raised, that issue is best addressed to the HRET. The reason for this ruling is self-evident, for it avoids duplicity of proceedings and a clash of jurisdiction between constitutional bodies, with due regard to the people’s mandate. In Lazatin v. Commission on Elections we ruled that, upon proclamation of the winning candidate and despite its alleged invalidity, the COMELEC is divested of its jurisdiction to hear the protest. Thus:

The petition is impressed with merit because the petitioner has been proclaimed winner of the Congressional elections in the first district of Pampanga, has taken his oath of office as such, and assumed his duties as Congressman. For this Court to take cognizance of the electoral protest against him would be to usurp the functions of the House Electoral Tribunal. The alleged invalidity of the proclamation (which has been previously ordered by the COMELEC itself) despite alleged irregularities in connection therewith, and despite the pendency of the protests of the rival candidates, is a matter that is also addressed, considering the premises, to the sound judgment of the Electoral Tribunal. In this case, certiorari will not lie considering that there is an available and adequate remedy in the ordinary course of law for the purpose of annulling or modifying the proceedings before the COMELEC. After the proclamation, petitioner’s remedy was an electoral protest before the HRET. The resolution of the issues presented in this petition is best addressed to the sound judgment and discretion of the electoral tribunal. The afore-quoted pronouncements are likewise applicable to the Petition at bar, with the references therein to the jurisdiction of the House of Representatives Electoral Tribunal over election protests involving members of the House of Representatives also being true for the SET as regards election protests involving Senators. In Chavez v. Commission on Elections,49 this Court similarly ruled that the word "sole" in Article VI, Section 17 of the 1987 Constitution underscores the exclusivity of the electoral tribunals' jurisdiction over election contests relating to their respective members. It is therefore crystal clear that this Court has no jurisdiction to entertain a petition for certiorari and mandamus on matters which may be threshed out in an election contest. It is the SET which has exclusive jurisdiction to act on the complaint of Pimentel involving, as it does, a contest relating to the election of Zubiri, now a member of the Senate. Pimentel attempts to bring his case outside the jurisprudential precedent set by Aggabao, but to no avail. That Pimentel filed the present Petition prior to Zubiri’s proclamation is insignificant. Since Pimentel’s prayer for a TRO and/or Status Quo Ante Order had been denied, Zubiri was proclaimed the twelfth winning Senator in the 2007 Senatorial Elections. Pimentel further claims that he is not challenging Zubiri’s proclamation, but rather the conduct of the proceedings before the NBC and the SPBOC-Maguindanao. This is just a roundabout argument. Pimentel cannot deny that he assails the canvass proceedings because he believes that the annulment and setting aside thereof would result in his winning as the twelfth Senator in the 14 May 2007 elections; and if he is the rightful winner, then logically and necessarily, Zubiri’s proclamation must also be annulled and set aside. Finally, while Section 15, in relation to Section 30, of Republic Act No. 7166, as amended by Republic Act No. 9369, did introduce an additional exception to the prohibition against pre-proclamation controversies in elections for President, Vice-President, and Senators, this Court has already established in the preceding discussion that Pimentel cannot invoke the same in his Petition. The provisions in question did not materially change the nature of canvass proceedings before the boards of canvassers, which still remain summary and administrative in nature for the purpose of canvassing the votes and determining the elected official with as little delay as possible and in time for the commencement of the new term of office. This Court deems it necessary to stress that attempts to delay the canvass proceedings, except for the permissible pre-proclamation controversies, must be shunned. Grounds which are proper for electoral protests should not be allowed to delay the proclamation of the winners.50 It may well be true that public policy may occasionally permit the occurrence of "grab the proclamation and prolong the protest" situations; that public policy, however, balances the possibility of such situations against the shortening of the period during which no winners are proclaimed, a period commonly fraught with tension and danger for the public at large. For those who disagree with that public policy, the appropriate recourse is not to ask this Court to abandon case law, which merely interprets faithfully existing statutory norms, to engage in judicial legislation and in effect to rewrite portions of the Omnibus Election Code. The appropriate recourse is, of course, to the Legislative

Department of the Government and to ask that Department to strike a new and different equilibrium in the balancing of the public interests at stake.51 IN VIEW OF THE FOREGOING, the present Petition for Certiorari and Mandamus is hereby DISMISSED. No costs. SO ORDERED.

G.R. No. 96938 October 15, 1991 GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), petitioner, vs. CIVIL SERVICE COMMISSION, HEIRS OF ELIZAR NAMUCO, and HEIRS OF EUSEBIO MANUEL, respondents.

NARVASA, J.: In May, 1981, the Government Service Insurance System (GSIS) dismissed six (6) employees as being "notoriously undersirable," they having allegedly been found to be connected with irregularities in the canvass of supplies and materials. The dismissal was based on Article IX, Presidential Decree No. 807 (Civil Service Law) 1 in relation to LOI 14-A and/or LOI No. 72. The employees' Motion for Reconsideration was subsequently denied. Five of these six dismissed employees appealed to the Merit Systems Board. The Board found the dismissals to be illegal because effected without formal charges having been filed or an opportunity given to the employees to answer, and ordered the remand of the cases to the GSIS for appropriate disciplinary proceedings. The GSIS appealed tothe Civil Service Commission. By Resolution dated October 21, 1987, the Commission ruled that the dismissal of all five was indeed illegal and disposed as follows: WHEREFORE, it being obvious that respondents' separation from the service is illegal, the GSIS is directed to reinstate them with payment of back salaries and benefits due them not later than ten (10) days from receipt of a copy hereof, without prejudice to the right of the GSIS to pursue proper disciplinary action against them. It is also directed that the services of their replacement be terminated effective upon reinstatement of herein respondents. xxx

xxx

xxx

Still unconvinced, the GSIS appealed to the Supreme Court (G.R. Nos. 80321-22). Once more, it was rebuffed. On July 4, 1988 this Court's Second Division promulgated a Resolution which: a) denied its petition for failing to show any grave abuse of discretion on the part of the Civl Service Commission, the dismissals of the employees having in truth been made without formal charge and hearin, and b) declared that reinstatement of said five employees was proper, "without prejudice to the right of the GSIS to pursue proper disciplinary action against them;" c) MODIFIED, however, the challenged CSC Resolution of October 21, 1987 "by elminating the payment of back salaries to private respondents (employees) until the outcome of the disciplinary proceedings is known, considering the gravity of the offenses imputed to them ..., 2 d) ordered reinstateement only of three employees, namely: Domingo Canero, Renato Navarro and Belen Guerrero, "it appearing tht respondents Elizar Namuco and Eusebio Manuel have since passed away." 3

On January 8, 1990, the aforesaid Resolution of July 4, 1988 having become final, the heirs of Namuco and Manuel filed a motion for execution of the Civil Service Commission Resolution of October 21, 1987, supra. The GSIS opposed the motion. It argued that the CSC Resolution of October 21, 1987 — directing reinstatement of the employees and payment to them of back salaries and benefits — had been superseded by the Second Division's Resolution of July 4, 1988 — precisely eliminating the payment of back salaries.

The Civil Service Commission granted the motion for execution in an Order dated June 20, 1990. It accordingly directed the GSIS "to pay the compulsory heirs of deceased Elizar Namuco and Eusebio Manuel for the period from the date of their illegal separation up to the date of their demise." The GSIS filed a motion for reconsideration. It was denied by Order of the CSC dated November 22, 1990.

Once again the GSIS has come to this Court, this time praying that certiorari issue to nullify the Orders of June 20, 1990 and November 22, 1990. Here it contends that the Civil Service Commission has no pwer to execute its judgments and final orders or resolutions, and even conceding the contrary, the writ of execution issued on June 20, 1990 is void because it varies this Court's Resolution of July 4, 1988.

The Civil Service Commission, like the Commission on Elections and the Commission on Audit, is a consitutional commission invested by the Constitution and relevant laws not only with authority to administer the civil service, 4

but also with quasi-judicial powers. 5 It has the authority to hear and decide administrative disciplinary cases instituted directly with it or brought to it on appeal. 6 The Commission shall decide by a majority vote of all its Members any case or matter brought before it within sixty days from the date of its submission for decision it within sixty days from the date of its submission for on certiorari by any aggrieved party within thirty days from receipt of a copy thereof. 7 It has the power, too, sitting en banc, to promulgate its own rules concerning pleadings and practice before it or before any of its offices, which rules should not however diminish, increase, or modify substantive rights. 8 On October 9, 1989, the Civil Service Commission promulgated Resolution No. 89-779 adopting, approving and putting into effect simplified rules of procedure on administrative disciplinary and protest cases, pursuant tothe authority granted by the constitutional and statutory provisions above cited, as well as Republic Act No. 6713. 9

Those rules provide, among other things, 10 that decision in "administrative disciplinary cases" shall be immediately executory unless a motion for reconsideration is seasonably filed. If the decision of the Commission is brought to the Supreme Court on certiorari, the same shall still be executory unless a restraining order or preliminary injunction is issued by the High Court." 11 This is similar to a provision in the former Civil Service Rules authorizing the Commissioner, "if public interest so warrants, ... (to) order his decision executed pending appeal to the Civil Service Board of Appeals." 12 The provisions are analogous and entirely consistent with the duty or responsibility reposed in the Chairman by PD 807, subject to policies and resolutions adopted by the Commission, "to enforce decision on administrative discipline involving officials of the Commission," 13 as well as with Section 37 of the same decree declaring that an appeal to the Commission 14 "shall not stop the decision from being executory, and in case the penalty is suspension or removal, the respondent shall be considered as having been under preventive suspension during the pendency of the appeal in the event he wins an appeal." In light of all the foregoing consitutional and statutory provisions, it would appear absurd to deny to the Civil Service Commission the power or authority or order execution of its decisions, resolutions or orders which, it should be stressed, it has been exercising through the years. It would seem quite obvious that the authority to decide cases is inutile unless accompanied by the authority to see taht what has been decided is carried out. Hence, the grant to a tribunal or agency of adjudicatory power, or the authority to hear and adjudge cases, should normally and logically be deemed to include the grant of authority to enforce or execute the judgments it thus renders, unless the law otherwise provides. In any event, the Commission's exercise of that power of execution has been sanctioned by this Court in several cases. In Cucharo v. Subido, 15 for instance, this Court sustained the challenged directive of the Civil Service Commissioner, that his decision "be executed immediately 'but not beyond ten days from receipt thereof ...". The Court said:

As a major premise, it has been the repeated pronouncement of this Supreme Tribunal that the Civil Service Commissioner has the discretion toorder the immediate execution in the public interst of his decisionseparating petitioner-appellant from the service, always sbuject however to the rule that, in the event the Civil Service Board of Appeals or the proper court determines that his dismissal is illegal, he should be paid the salary corresponding to the period of his separation from the service unitl his reinstatement. Petitioner GSIS concedes that the heirs of Namuco and Manuel "are entitled tothe retirement/death and other benefits due them as government employees" since, at the time of their death, they "can be considered not to have been separated from the separated from the service." 16 It contend, however, that since Namuco and Manuel had not been "completely exonerated of the administrative charge filed against them — as the filing of the proper disciplinary action was yet to have been taken had death not claimed them" — no back salaries may be paid to them, although they "may charge the period of (their) suspension against (their) leave credits, if any, and may commute such leave credits to money value;" 17

this, on the authority of this Court's decision in Clemente v. Commission on Audit. 18 It is in line with these considerations, it argues, that the final and executory Resolution of this Court's Second Division of July 4, 1988 should be construed; 19 and since the Commission's Order of July 20, 1990 maikes a contrary disposition, the latter order obviously cannot prevail and must be deemed void and ineffectual. This Court's Resolution of July 4, 1988, as already stated, modified the Civil Service Commission's Resolution of October 21, 1987 — inter alia granting back salaries tothe five dismissed employees, including Namuco and Manuel — and pertinently reads as follows: We modify the said Order, however, by eliminating the payment of back salaries to private respondents until the outcome of the disciplinary proceedings is known, considering the gravity of the offense imputed to them in connection with the irregularities in the canvass of supplies and materials at the GSIS. The reinstatement order shall apply only to respondents Domingo Canero, Renato Navarro and Belen Guerrero, it appearing that respondents Elizar Namuco and Eusebio Manuel have since passed away. .... On the other hand, as also already stated, the Commission's Order of June 20, 1990 directed the GSIS "to pay the compulsory heirs of deceased Elizar Namuco and Eusebio Manuel for the period from the date of their illegal separation up to the date of their demise." The Commission asserted that in promulgating its disparate ruling, it was acting "in the interest of justice and for other humanitarian reasons," since the question of whether or not Namuco and Manuel should receive back salaries was "dependent on the result of the disciplinary proceedings against their co-respondents in the administrative case before the GSIS," and since at the tiem of their death, "no formal charge ... (had) as yet been made, nor any finding of their personal culpability ... and ... they are no longer in a position to refute the charge." The Court agrees that the challenged orders of the Civil Service Commission should be upheld, and not merely upon compassionate grounds, but simply because there is no fair and feasible alternative in the circumstances. To be sure, if the deceased employees were still alive, it would at least be arguable, positing the primacy of this Court's final dispositions, that the issue of payment of their back salaries should properly await the outcome of the disciplinary proceedings referred to in the Second Division's Resolution of July 4, 1988. Death, however, has already sealed that outcome, foreclosing the initiation of disciplinary administrative proceedings, or the continuation of any then pending, against the deceased employees. Whatever may be said of the binding force of the Resolution of July 4, 1988 so far as, to all intents and pursposes, it makes exoneration in the adminstrative proceedings a condition precedent to payment of back salaries, it cannot exact an impossible performance or decree a useless exercise. Even in the case of crimes, the death of the offender exteinguishes criminal liability, not only as to the personal, but also as to the pecuniary, penalties if it

occurs before final judgment.20 In this context, the subsequent disciplinary proceedings, even if not assailable on grounds of due process, would be an inutile, empty procedure in so far as the deceased employees are concerned; they could not possibly be bound by any substatiation in said proceedings of the original charges: irrigularities in the canvass of supplies and materials. The questioned order of the Civil Service Commission merely recognized the impossibility of complying with the Resolution of July 4, 1988 and the legal futility of attempting a post-mortem investigation of the character contemplated. WHEREFORE, the petition is DISMISSED, without pronouncement as to costs. SO ORDERED.

G.R. No. 165788

February 7, 2007

ALEJANDRO V. DONATO, JR. Petitioner, vs. CIVIL SERVICE COMMISSION REGIONAL OFFICE NO. 1, Respondent. DECISION CALLEJO, SR., J.: Before the Court is the Petition for Review on Certiorari filed by Alejandro V. Donato, Jr. which seeks to reverse and set aside the Decision1 dated October 11, 2004 of the Court of Appeals in CA-G.R. SP No. 73854. The assailed decision affirmed Resolution No. 020348 dated March 7, 2002 and Resolution No. 021423 dated October 23, 2002 of the Civil Service Commission (CSC) which had, in turn, affirmed the decision of the Civil Service Commission Regional Office No. 1 (CSCRO 1) finding petitioner Donato, Jr. guilty of dishonesty and falsification of official document and ordering his dismissal from the service. The case arose from the following facts: Donato, Jr. was a secondary school teacher at the San Pedro Apartado National High School in Alcala, Pangasinan while Gil C. Arce held the position of Assessment Clerk II at the Office of the Municipal Treasurer of the said municipality. On October 5, 1998, the Management Information Office of the CSC in Diliman, Quezon City received an anonymous letter-complaint requesting an investigation on the alleged dishonest act committed by Donato, Jr. It was alleged that Donato, Jr., falsely representing himself as Arce during the Career Service Sub-Professional Examination held in 1995,2 took the said examination in behalf of the latter.1avvphi1.net The anonymous complaint stated in part: I have the honor to request your good Office to investigate the dishonesty committed by Mr. Alejandro V. Donato, Jr. who impersonated Mr. Gil C. Arce during the Sub-Professional Examination taken in 1995. They are working in San Pedro Apartado National High School, Alcala, Pangasinan and in the Municipality of Alcala, respectively. They are cheating the government and as far as rumors this is not only the examination anomaly he committed. x x x x3 Attached thereto was a photograph of Donato, Jr. The letter-complaint was immediately forwarded to the CSCRO 1, City of San Fernando, La Union, which required Donato, Jr. and Arce to submit their respective answers thereto. In his Answer dated May 19, 1999, Arce vehemently denied committing such act of dishonesty. He claimed that he was "the same person who took the said examination and through [his] own merit successfully passed the same." In support thereof, he attached the joint-affidavit of Gerry Cabrera and David Arce attesting that, on August 5, 1990, they all, including Arce, took the Career Service Sub-Professional Examination given by the CSC at the Binmaley Catholic High School, Binmaley, Pangasinan. Donato, Jr., for his part, averred in his Answer dated May 24, 1999 that:

I was greatly troubled that my picture appeared in the Seat Plan. The appearance of my picture would substantiate the allegation of the anonymous complaint, whoever he/she is. The truth is that Mr. Arce asked me once to take the test for him, but I vehemently refused the offer knowing that this would [be] tantamount to cheating, and that it would put me in hot waters. Mr. Arce told me that he had taken the examination, but did not make it. It was then that he asked me to take the examination for him, of which I refused knowing that the Honorable Commission has some pertinent records of myself such as copies of my Appointment Papers, PDS, PBET, and other similar documents. The fact is, I advised him to try again, which he did. He even asked me to accompany him in Binmaley to help him locate his testing room. After we had found his testing room, I immediately left him knowing that there was nothing else I could do. I proceeded to Lingayen to visit my mother. After some time, Mr. Arce announced to me that he passed the test with a very high rating. How my picture was used, I have no idea. All I know is that I used that picture when I took my PBET in November 1998 in Dagupan City. I had other copies of that picture, two of which I submitted to Mrs. Erlinda C. Tadeo, my former principal, for loan purposes. As for the rest, I could no longer locate them because I either misplaced them or lost them. I suspect that my picture was used for personal vendetta against me, to harass me in order that I desist from furthering my case filed before the Honorable Commission against my former principal. I, therefore, vehemently deny the allegation of the Honorable Anonymous Complaint, whoever he/she is. 4 The Picture Seat Plan (PSP) of Examination Room No. 24 in Binmaley Catholic High School for the August 5, 1990 Career Service Sub-Professional Examination (where the name Gil Arce appeared) showed that the identification (ID) picture pasted above the name Gil Arce was that of Donato, Jr. It was also observed that the signature appearing thereon was different from the signature of Arce in his Answer. Taking into consideration the foregoing, a Formal Charge dated October 12, 1999 was filed by Romeo C. De Leon, Director IV of CSCRO 1, against Donato, Jr. and Arce for dishonesty and falsification of official document. The case was docketed as Administrative Case No. 99-27. Donato, Jr. and Arce were, accordingly, required to file their respective answers to the said formal charge. In his Answer5 dated December 14, 1999, Arce basically adopted the allegations in his previous answer. In addition thereto, he claimed that ever since he was a child, it was his habit to keep photographs of members of his family and friends in his wallet, including that of Donato, Jr. According to Arce, during the said examination, he may have mistakenly submitted the ID picture of Donato, Jr. With respect to the signature, Arce maintained that the signature on the PSP was one of his signatures and that the one that appeared on his answer was what he was using at the time. In his Answer6 dated December 24, 1999, Donato, Jr. adopted the averments in his previous answer. Additionally, he harped on the apparent discrepancy in the dates considering that the anonymous lettercomplaint stated that the date of examination was in 1995 while in the formal charge, two different dates were mentioned: August 5, 1990 and August 5, 1999. The discrepancy in the dates allegedly rendered him incapable of addressing head-on the charges against him. He vigorously denied that he misrepresented himself as Arce and that he took the said government examination in the latter’s stead. He claimed that he was at his residence in Poblacion East, Alcala, Pangasinan the whole day of August 5, 1990 and, in fact, he received some visitors thereat. He submitted the affidavits of Diosdado Tamayo and Baldomino Batuan attesting that they went to see him at his house on the said date. Subsequently, a trial-type hearing was conducted where the parties, particularly Donato, Jr. and Arce, were given the opportunity to proffer documentary and testimonial evidence. Thereafter, the CSCRO 1, through

Lorenzo S. Danipog, Director IV, rendered Decision No. 2001-1137 dated May 30, 2001 in Administrative Case No. 99-27, dismissing Donato, Jr. and Arce from the service for dishonesty and falsification of official document. Donato, Jr. and Arce sought reconsideration of the said decision and/or new trial but their respective motions were denied by the CSCRO 1 for lack of merit. By way of appeal, they elevated the case to the CSC. After due consideration of the pleadings, the CSC promulgated Resolution No. 020348 dated March 7, 2002, affirming the earlier decision of the CSCRO 1. The CSC ruled that there was substantial evidence to hold both Donato, Jr. and Arce guilty of the charges of dishonesty and falsification of official document. Specifically, the ID picture of Donato, Jr. pasted on the PSP during the August 5, 1990 Career Service Sub-Professional Examination above Arce’s name and the marked dissimilarity between Arce’s purported signature thereon and his signature as appearing in his answer were taken by the CSC as indicative of the fact that it was Donato, Jr. who actually took the said examination in behalf of Arce. The dispositive portion of CSC Resolution No. 020348 reads: WHEREFORE, the appeal of Gil Arce and Alejandro Donato, Jr. is hereby DISMISSED. Accordingly, the Decision dated May 30, 2001 of the Civil Service Commission Regional Office (CSCRO) No. 1, San Fernando City, La Union, finding them guilty of Dishonesty and Falsification of Official Document and dismissing them from the service stands. IRMO and CSCRO 1 are directed to effect the revocation of the civil service eligibilities of Gil Arce and Alejandro Donato, Jr. in the implementation of this resolution.8 A motion for reconsideration thereof was filed by Donato, Jr. and Arce but it was denied by the CSC in its Resolution No. 021423 dated October 23, 2002. In this resolution, the CSC stressed that "the guilt of Arce and Donato, Jr. was sufficiently proven by substantial evidence; hence, there is no cogent reason to warrant the reversal or modification of CSC Resolution No. 020348 dated March 7, 2002."9 Donato, Jr. and Arce forthwith filed with the Court of Appeals (CA) a petition for review assailing the aforesaid resolutions of the CSC. The CA, however, in the assailed Decision dated October 11, 2004, affirmed CSC Resolution Nos. 020348 and 021423. The CA did not give credence to their insistence that the letter-complaint should have been dismissed outright for non-compliance with Section 8,10 Rule II of the Uniform Rules on Administrative Cases in the Civil Service. In particular, it was Donato, Jr. and Arce’s contention that the CSC should have dismissed outright the anonymous letter-complaint. Addressing this argument, the CA, echoing the reasoning of the CSC, pointed out that the basis for the formal investigation against them was not the anonymous complaint but the finding of a prima facie case against them after a fact-finding investigation.11 The CA, likewise, considered as puerile Donato, Jr. and Arce’s claim that the documentary evidence against them had no probative value as the public officials who were in custody of these documents were not presented. The CA reasoned that the documentary evidence against Donato, Jr. and Arce are public documents and the probative weight accorded these documents is enunciated in Section 23, Rule 132 of the Revised Rules on Evidence, to wit: SEC. 23. Public documents as evidence. – Documents consisting of entries in public records made in the performance of a duty by a public officer are prima facie evidence of the facts therein stated. All other public documents are evidence, even against a third person, of the fact which gave rise to their execution and of the date of the latter. Specifically, the evidentiary value of the PSP for Examination Room No. 24 of the Binmaley Catholic High School in which the ID picture of Donato, Jr. was pasted above Arce’s name was, according to the CA, correctly given evidentiary weight by the CSC in consonance with the above-quoted provision, and especially when viewed in the context of Arce’s assertion that he may have mistakenly submitted Donato Jr.’s ID picture

when he took the said government examination. Lacking a satisfactory explanation for Donato, Jr.’s ID picture on the said PSP and the variance between Arce’s purported signature thereon and that on the answer that he filed with the CSCRO 1, the CA held that Donato, Jr. and Arce were correctly found liable for dishonesty and falsification of official document. Donato, Jr. and Arce’s claim of violation of their right to due process when they were found administratively liable, allegedly despite the absence of witnesses against them, was given short shrift by the CA. It pointed out that the records clearly showed that they were accorded the opportunity to present their side and, in fact, they submitted evidence to controvert the charges against them. The CA ruled that under the circumstances the requirements of due process had been sufficiently met. The dispositive portion of the assailed CA decision reads: WHEREFORE, the petition for review is DENIED for lack of merit and respondent’s assailed Resolution Nos. 020348 and 021423 are AFFIRMED in toto. SO ORDERED.12 Only Donato, Jr. (the petitioner) filed the present petition for review seeking to reverse and set aside the Decision dated October 11, 2004 of the CA. He raises the following issues for the Court’s resolution: I WHETHER OR NOT THE PROCEEDINGS, UNDERTAKEN BY THE RESPONDENT, THE FORUM OF ORIGIN, ARE TAINTED WITH IRREGULARITY, INCLUDING DENIAL TO PETITIONER OF THE RIGHT OF CONFRONTATION, SUCH THAT THERE IS NOT A SINGLE PIECE OF EVIDENCE ADDUCED AGAINST PETITIONER; II WHETHER OR NOT THE FORUM OF ORIGIN AND THE SUBSEQUENT FORA IN WHICH THIS CASE PASSED THROUGH ON APPEAL ARE CORRECT IN CONCLUDING THAT PETITIONER IMPERSONATED GIL C. ARCE BECAUSE OF THE PRESENCE OF THE FORMER’S PICTURE IN THE SPACE INTENDED FOR THE PICTURE OF THE LATTER IN THE PICTURE SEAT PLAN (EXHIBIT "C") OF THE AUGUST 5, 1990 CIVIL SERVICE EXAMINATION AT ROOM 24, BINMALEY CATHOLIC HIGH SCHOOL, BINMALEY, PANGASINAN.13 The petitioner mainly assails the reliance by the CSCRO 1, the CSC and the CA on the Picture Seat Plan (marked as Exhibit "C"), which contained his ID picture above the name of Arce, in finding them both guilty of the administrative charges of dishonesty and falsification of official document. It is his contention that the PSP was erroneously considered as evidence when what was presented during the proceedings conducted by the CSCRO 1 was only a photocopy thereof. Upon the petitioner’s demand, at the hearing of August 8, 2000, the counsel of CSCRO 1 produced a document which he claimed was an original copy of the PSP. However, the petitioner objected to the manner of presentation because the counsel was not allegedly the custodian of the said document. Moreover, he was not put on the witness stand and, consequently, was not subjected to crossexamination. The petitioner emphasizes that the PSP was not identified and formally offered in evidence. The petitioner claims violation of his right to due process because he was not able to confront the person who prepared, and who was in custody of, the PSP. He maintains that the presence of his ID picture above Arce’s name could be made by any person by simply pasting it over another ID picture for an evil purpose. In this connection, he accuses his former principal, Mrs. Erlinda Tadeo, as the one responsible therefor because he (the petitioner), together with his co-teachers, filed an administrative case against her, for which she was meted a fine equivalent to her six months salary. The petition is bereft of merit.

It must be stated, at the outset, that the CSCRO 1, the CSC and the CA uniformly found the petitioner liable for the charges of dishonesty and falsification of official document. In so doing, the PSP, on which the ID picture of the petitioner appeared above the name of Arce, was given credence by the CSCRO 1, the CSC and the CA to support the administrative charges against the petitioner and Arce. No rule is more entrenched in this jurisdiction than that the findings of facts of administrative bodies, if based on substantial evidence, are controlling on the reviewing authority.14 Stated in another manner, as a general rule, factual findings of administrative agencies, such as the CSC, that are affirmed by the CA, are conclusive upon and generally not reviewable by this Court.15 To be sure, there are recognized exceptions to this rule, to wit: (1) when the findings are grounded entirely on speculation, surmises, or conjectures; (2) when the inference made is manifestly mistaken, absurd, or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of facts are conflicting; (6) when in making its findings, the CA went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee; (7) when the findings are contrary to those of the trial court; (8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the respondent; (10) when the findings of facts are premised on the supposed absence of evidence and contradicted by the evidence on record; and (11) when the CA manifestly overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.16 None of these exceptions has been shown to be attendant in the present case. On the other hand, petitioner would like this Court to re-examine the evidence against him as he impugns, in particular, the PSP which contained his ID picture above Arce’s name. However, it is not the function of this Court to analyze or weigh all over again the evidence and credibility of witnesses presented before the lower court, tribunal or office. This flows from the basic principle that the Supreme Court is not a trier of facts. Its jurisdiction is limited to reviewing and revising errors of law imputed to the lower court, the latter’s findings of fact being conclusive and not reviewable by this Court.17 The petitioner’s contention that his right to due process was violated because he was not able to crossexamine the person who had custody of the PSP is unavailing. In another case, the Court addressed a similar contention by stating that the petitioner therein could not argue that she had been deprived of due process merely because no cross-examination took place.18 Indeed, in administrative proceedings, due process is satisfied when the parties are afforded fair and reasonable opportunity to explain their side of the controversy or given opportunity to move for a reconsideration of the action or ruling complained of. 19 Such minimum requirements have been satisfied in this case for, in fact, hearings were conducted by the CSCRO 1 and the petitioner and Arce actively participated therein and even submitted their respective evidence. Moreover, they were able to seek reconsideration of the decision of the CSCRO 1 and, subsequently, to elevate the case for review to the CSC and the CA. Likewise unavailing is the petitioner’s protestation that the PSP was not identified and formally offered in evidence. The CSC, including the CSCRO 1 in this case, being an administrative body with quasi-judicial powers, is not bound by technical rules of procedure and evidence in the adjudication of cases, subject only to limitations imposed by basic requirements of due process.20 As earlier opined, these basic requirements of due process have been complied with by the CSC, including the CSCRO 1. It is well, at this point, to quote with approval the following ratiocination made by the CSC: The picture of Donato pasted over the name of Gil Arce in the PSP during the Career Service Subprofesssional Examination on August 5, 1990 is indicative of the fact that respondent Arce did not personally take the said examination but Donato in his behalf. This is so because as a matter of procedure, the room examiners assigned to supervise the conduct of examination closely examine the pictures submitted by the examinees. An examinee is not allowed by the examiners to take the examination if he does not look like the person in the picture he submitted and affixed in the PSP (CSC Resolution No. 95-3694 dated June 20, 1995 cited in CSC Resolution No. 97-0217 dated January 14, 1997). Obviously, the person whose picture is pasted

on the PSP was the one who took the examination for and in behalf of Arce. In the offense of impersonation, there are always two persons involved. The offense cannot prosper without the active participation of both persons (CSC Resolution No. 94-6582). Further, by engaging or colluding with another person to take the test in his behalf and thereafter by claiming the resultant passing rate as his, clinches the case against him. In cases of impersonation, the Commission has consistently rejected claims of good faith, for "it is contrary to human nature that a person will do (impersonation) without the consent of the person being impersonated." (CSC resolution No. 94-0826) It has been a settled rule in this jurisdiction that the duly accomplished form of the Civil Service is an official document of the Commission, which, by its very nature is considered in the same category as that of a public document, admissible in evidence without need of further proof. As official document, the contents/entries therein made in the course of official duty are prima facie evidence of the facts stated therein (Maradial vs. CSC, CA-G.R. SP No. 40764 dated September 27, 1996).21 Additionally, the petitioner’s proposition that the matter could be the handiwork of his former principal, who had an axe to grind against him, is utterly preposterous. This bare and gratuitous allegation cannot stand against the ruinous evidence against him and Arce. Those government employees who prepared the PSP and who supervised the conduct of the Career Service Sub-Professional Examination on August 5, 1990, enjoy the presumption that they regularly performed their duties and this presumption cannot be disputed by mere conjectures and speculations.22 In fine, the CA committed no reversible error when it affirmed the resolutions of the CSC finding the petitioner guilty of dishonesty and falsification of official document. The petitioner has miserably failed to present any cogent reason for the Court to deviate from the salutary rule that factual findings of administrative agencies, especially when affirmed by the CA, are generally held to be binding and final so long as they are supported by substantial evidence in the record of the case.23 WHEREFORE, premises considered, the petition is DENIED for lack of merit. The Decision dated October 11, 2004 of the Court of Appeals in CA-G.R. SP No. 73854 is AFFIRMED in toto. SO ORDERED.

[G.R. No. 124043. October 14, 1998]

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. COURT OF APPEALS, COURT OF TAX APPEALS and YOUNG MENS CHRISTIAN ASSOCIATION OF THE PHILIPPINES, INC., respondents. DECISION PANGANIBAN, J.: Is the income derived from rentals of real property owned by the Young Mens Christian Association of the Philippines, Inc. (YMCA) established as a welfare, educational and charitable non-profit corporation -- subject to income tax under the National Internal Revenue Code (NIRC) and the Constitution?

The Case This is the main question raised before us in this petition for review on certiorari challenging two Resolutions issued by the Court of Appeals[1] on September 28, 1995[2]and February 29, 1996[3] in CA-GR SP No. 32007. Both Resolutions affirmed the Decision of the Court of Tax Appeals (CTA) allowing the YMCA to claim tax exemption on the latters income from the lease of its real property.

The Facts The Facts are undisputed.[4] Private Respondent YMCA is a non-stock, non-profit institution, which conducts various programs and activities that are beneficial to the public, especially the young people, pursuant to its religious, educational and charitable objectives. In 1980, private respondent earned, among others, an income of P676,829.80 from leasing out a portion of its premises to small shop owners, like restaurants and canteen operators, and P44,259.00 from parking fees collected from non-members. On July 2, 1984, the commissioner of internal revenue (CIR) issued an assessment to private respondent, in the total amount of P415,615.01 including surcharge and interest, for deficiency income tax, deficiency expanded withholding taxes on rentals and professional fees and deficiency withholding tax on wages. Private respondent formally protested the assessment and, as a supplement to its basic protest, filed a letter dated October 8, 1985.In reply, the CIR denied the claims of YMCA. Contesting the denial of its protest, the YMCA filed a petition for review at the Court if Tax Appeals (CTA) on March 14, 1989. In due course, the CTA issued this ruling in favor of the YMCA: xxx [T]he leasing of private respondents facilities to small shop owners, to restaurant and canteen operators and the operation of the parking lot are reasonably incidental to and reasonably necessary for the accomplishment of the objectives of the [private respondents]. It appears from the testimonies of the witnesses for the [private respondent] particularly Mr. James C. Delote, former accountant of YMCA, that these facilities were leased to members and that they have to service the needs of its members and their guests. The Rentals were minimal as for example, the barbershop was only charged P300 per month. He also testified that there was actually no lot devoted for parking space but the parking was done at the sides of the building. The parking was primarily for members with stickers on the windshields of their cars and they charged P.50 for non-members.The rentals and parking fees were just enough to cover the costs of operation and maintenance only. The earning[s] from these rentals and parking charges including those from lodging and other charges for the use of the recreational facilities constitute [the] bulk of its income which [is] channeled to support its many activities and attainment of its objectives. As pointed out earlier, the membership dues are very insufficient to support its program. We find it reasonably necessary therefore for [private respondent] to make [the] most out [of] its existing facilities to earn some income. It would have been different if under the circumstances, [private respondent] will purchase a lot and convert it to a parking lot to cater to the needs of the general public for a fee, or construct a building and lease it out to the highest bidder or at the market rate for commercial purposes, or should it invest its funds in the buy and sell of properties, real or personal. Under these circumstances, we could conclude that the activities are already profit oriented, not incidental and reasonably necessary to the pursuit of the objectives of the association and therefore, will fall under the last paragraph of section 27 of the Tax Code and any income derived therefrom shall be taxable. Considering our findings that [private respondent] was not engaged in the business of operating or contracting [a] parking lot, we find no legal basis also for the imposition of [a] deficiency fixed tax and [a] contractors tax in the amount[s] of P353.15 and P3,129.73, respectively. xxxxxxxxx WHEREFORE, in view of all the foregoing, the following assessments are hereby dismissed for lack of merit: 1980 Deficiency Fixed Tax P353,15; 1980 Deficiency Contractors Tax P3,129.23; 1980 Deficiency Income Tax P372,578.20. While the following assessments are hereby sustained: 1980 Deficiency Expanded Withholding Tax P1,798.93; 1980 Deficiency Withholding Tax on Wages P33,058.82 plus 10% surcharge and 20% interest per annum from July 2, 1984 until fully paid but not to exceed three (3) years pursuant to Section 51 (e)(2) & (3) of the National Internal Revenue Code effective as of 1984.[5]

Dissatisfied with the CTA ruling, the CIR elevated the case to the Court of Appeals (CA). In its Decision of February 16, 1994, the CA[6] initially decided in favor of the CIR and disposed of the appeal in the following manner: Following the ruling in the afore-cited cases of Province of Abra vs. Hernando and Abra Valley College Inc. vs. Aquino, the ruling of the respondent Court of Tax Appeals that the leasing of petitioners (herein respondent) facilities to small shop owners, to restaurant and canteen operators and the operation of the parking lot are reasonably incidental to and reasonably necessary for the accomplishment of the objectives of the petitioners,' and the income derived therefrom are tax exempt, must be reversed. WHEREFORE, the appealed decision is hereby REVERSED in so far as it dismissed the assessment for: 1980 Deficiency Income Tax P 353.15 1980 Deficiency Contractors Tax P 3,129.23, & 1980 Deficiency Income Tax P372,578.20, but the same is AFFIRMED in all other respect.[7] Aggrieved, the YMCA asked for reconsideration based on the following grounds: I The findings of facts of the Public Respondent Court of Tax Appeals being supported by substantial evidence [are] final and conclusive. II The conclusions of law of [p]ublic [r]espondent exempting [p]rivate [r]espondent from the income on rentals of small shops and parking fees [are] in accord with the applicable law and jurisprudence.[8] Finding merit in the Motion for Reconsideration filed by the YMCA, the CA reversed itself and promulgated on September 28, 1995 its first assailed Resolution which, in part, reads: The Court cannot depart from the CTAs findings of fact, as they are supported by evidence beyond what is considered as substantial. xxxxxxxxx The second ground raised is that the respondent CTA did not err in saying that the rental from small shops and parking fees do not result in the loss of the exemption. Not even the petitioner would hazard the suggestion that YMCA is designed for profit. Consequently, the little income from small shops and parking fees help[s] to keep its head above the water, so to speak, and allow it to continue with its laudable work. The Court, therefore, finds the second ground of the motion to be meritorious and in accord with law and jurisprudence. WHEREFORE, the motion for reconsideration is GRANTED; the respondent CTAs decision is AFFIRMED in toto.[9] The internal revenue commissioners own Motion for Reconsideration was denied by Respondent Court in its second assailed Resolution of February 29, 1996. Hence, this petition for review under Rule 45 of the Rules of Court.[10]

The Issues Before us, petitioner imputes to the Court of Appeals the following errors: I

In holding that it had departed from the findings of fact of Respondent Court of Tax Appeals when it rendered its Decision dated February 16, 1994; and II In affirming the conclusion of Respondent Court of Tax Appeals that the income of private respondent from rentals of small shops and parking fees [is] exempt from taxation.[11]

This Courts Ruling The Petition is meritorious.

First Issue: Factual Findings of the CTA Private respondent contends that the February 16, 1994 CA Decision reversed the factual findings of the CTA. On the other hand, petitioner argues that the CA merely reversed the ruling of the CTA that the leasing of private respondents facilities to small shop owners, to restaurant and canteen operators and the operation of parking lots are reasonably incidental to and reasonably necessary for the accomplishment of the objectives of the private respondent and that the income derived therefrom are tax exempt.[12]Petitioner insists that what the appellate court reversed was the legal conclusion, not the factual finding, of the CTA.[13] The commissioner has a point. Indeed, it is a basic rule in taxation that the factual findings of the CTA, when supported by substantial evidence, will not be disturbed on appeal unless it is shown that the said court committed gross error in the appreciation of facts. [14] In the present case, this Court finds that the February 16, 1994 Decision of the CA did not deviate from this rule.The latter merely applied the law to the facts as found by the CTA and ruled on the issue raised by the CIR: Whether or not the collection or earnings of rental income from the lease of certain premises and income earned from parking fees shall fall under the last paragraph of Section 27 of the National Internal Revenue Code of 1977, as amended.[15] Clearly, the CA did not alter any fact or evidence. It merely resolved the aforementioned issue, as indeed it was expected to. That it did so in a manner different from that of the CTA did not necessarily imply a reversal of factual findings. The distinction between a question of law and a question of fact is clear-cut. It has been held that [t]here is a question of law in a given case when the doubt or difference arises as to what the law is on a certain state of facts; there is a question of fact when the doubt or difference arises as to the truth or falsehood of alleged facts. [16] In the present case, the CA did not doubt, much less change, the facts narrated by the CTA. It merely applied the law to the facts. That its interpretation or conclusion is different from that of the CTA is not irregular or abnormal.

Second Issue: Is the Rental Income of the YMCA Taxable? We now come to the crucial issue: Is the rental income of the YMCA from its real estate subject to tax? At the outset, we set forth the relevant provision of the NIRC: SEC. 27. Exemptions from tax on corporations. -- The following organizations shall not be taxed under this Title in respect to income received by them as such -xxxxxxxxx (g) Civic league or organization not organized for profit but operated exclusively for the promotion of social welfare;

(h) Club organized and operated exclusively for pleasure, recreation, and other non-profitable purposes, no part of the net income of which inures to the benefit of any private stockholder or member; xxxxxxxxx Notwithstanding the provision in the preceding paragraphs, the income of whatever kind and character of the foregoing organization from any of their properties, real or personal, or from any of their activities conducted for profit, regardless of the disposition made of such income, shall be subject to the tax imposed under this Code. (as amended by Pres. Decree No. 1457) Petitioners argues that while the income received by the organizations enumerated in Section 27 (now Section 26) of the NIRC is, as a rule, exempted from the payment of tax in respect to income received by them as such, the exemption does not apply to income derived xxx from any if their properties, real or personal, or from any of their activities conducted for profit, regardless, of the disposition made of such income xxx. Petitioner adds that rented income derived by a tax-exempt organization from the lease of its properties, real or personal, [is] not, therefore, exempt from income taxation, even if such income [is] exclusively used for the accomplishment of its objectives.[17] We agree with the commissioner. Because taxes are the lifeblood of the nation, the Court has always applied the doctrine of strict interpretation in construing tax exemptions.[18] Furthermore, a claim of statutory exemption from taxation should be manifest and unmistakable from the language of the law on which it is based. Thus, the claimed exemption must expressly be granted in a statute stated in a language too clear to be mistaken.[19] In the instant case, the exemption claimed by the YMCA is expressly disallowed by the very wording of the last paragraph of then Section 27 of the NIRC which mandates that the income of exempt organizations (such as the YMCA) from any of their properties, real or personal, be subject to the imposed by the same Code. Because the last paragraph of said section unequivocally subjects to tax the rent income f the YMCA from its rental property,[20] the Court is duty-bound to abide strictly by its literal meaning and to refrain from resorting to any convoluted attempt at construction. It is axiomatic that where the language of the law is clear and unambiguous, its express terms must be applied.[21] Parenthetically, a consideration of the question of construction must not even begin, particularly when such question is on whether to apply a strict construction or a literal one on statutes that grant tax exemptions to religious, charitable and educational propert[ies] or institutions.[22] The last paragraph of Section 27, the YMCA argues, should be subject to the qualification that the income from the properties must arise from activities conducted for profit before it may be considered taxable. [23] This argument is erroneous. As previously stated, a reading of said paragraph ineludibly shows that the income from any property of exempt organizations, as well as that arising from any activity it conducts for profit, is taxable. The phrase any of their activities conducted for profit does not qualify the word properties. This makes income from the property of the organization taxable, regardless of how that income is used -- whether for profit or for lofty non-profit purposes. Verba legis non est recedendum. Hence, Respondent Court of Appeals committed reversible error when it allowed, on reconsideration, the tax exemption claimed by YMCA on income it derived from renting out its real property, on the solitary but unconvincing ground that the said income is not collected for profit but is merely incidental to its operation. The law does not make a distinction. The rental income is taxable regardless of whence such income is derived and how it used or disposed of. Where the law does not distinguish, neither should we.

Constitutional Provisions on Taxation Invoking not only the NIRC but also the fundamental law, private respondent submits that Article VI, Section 28 of par. 3 of the 1987 Constitution,[24] exempts charitable institutions from the payment not only of property taxes but also of income tax from any source.[25] In support of its novel theory, it compares the use of the words charitable institutions, actually and directly in the 1973 and the 1987 Constitutions, on the hand; and in Article VI Section 22, par. 3 of the 1935 Constitution, on the other hand.[26]

Private respondent enunciates three points. First, the present provision is divisible into two categories: (1) [c]haritable institutions, churches and parsonages or convents appurtenant thereto, mosques and non-profit cemeteries, the incomes of which are, from whatever source, all tax-exempt;[27] and (2) [a]ll lands, buildings and improvements actually and directly used for religious, charitable or educational purposes, which are exempt only from property taxes.[28] Second, Lladoc v. Commissioner of Internal Revenue,[29] which limited the exemption only to the payment of property taxes, referred to the provision of the 1935 Constitution and not to its counterparts in the 1973 and the 1987 Constitutions.[30] Third, the phrase actually, directly and exclusively used for religious, charitable or educational purposes refers not only to all lands, buildings and improvements, but also to the above-quoted first category which includes charitable institutions like the private respondent.[31] The Court is not persuaded. The debates, interpellations and expressions of opinion of the framers of the Constitution reveal their intent which, in turn, may have guided the people in ratifying the Charter.[32] Such intent must be effectuated. Accordingly, Justice Hilario G. Davide, Jr., a former constitutional commissioner, who is now a member of this Court, stressed during the Concom debates that xxx what is exempted is not the institution itself xxx; those exempted from real estate taxes are lands, buildings and improvements actually, directly and exclusively used for religious, charitable or educational purposes.[33] Father Joaquin G. Bernas, an eminent authority on the Constitution and also a member of the Concom, adhered to the same view that the exemption created by said provision pertained only to property taxes.[34] In his treatise on taxation, Mr. Justice Jose C. Vitug concurs, stating that [t]he tax exemption covers property taxes only."[35] Indeed, the income tax exemption claimed by private respondent finds no basis in Article VI, Section 28, par. 3 of the Constitution. Private respondent also invokes Article XIV, Section 4, par. 3 of the Charter,[36] claiming that the YMCA is a nonstock, non-profit educational institution whose revenues and assets are used actually, directly and exclusively for educational purposes so it is exempt from taxes on its properties and income. [37] We reiterate that private respondent is exempt from the payment of property tax, but not income tax on the rentals from its property. The bare allegation alone that it is a non-stock, non-profit educational institution is insufficient to justify its exemption from the payment of income tax. As previously discussed, laws allowing tax exemption are construed strictissimi juris. Hence, for the YMCA to be granted the exemption it claims under the aforecited provision, it must prove with substantial evidence that (1) it falls under the classification non-stock, non-profit educational institution; and (2) the income it seeks to be exempted from taxation is used actually, directly, and exclusively for educational purposes. However, the Court notes that not a scintilla of evidence was submitted by private respondent to prove that it met the said requisites. Is the YMCA an educational institution within the purview of Article XIV, Section 4, par.3 of the Constitution? We rule that it is not. The term educational institution or institution of learning has acquired a well-known technical meaning, of which the members of the Constitutional Commission are deemed cognizant.[38] Under the Education Act of 1982, such term refers to schools.[39] The school system is synonymous with formal education,[40] which refers to the hierarchically structured and chronological graded learnings organized and provided by the formal school system and for which certification is required in order for the learner to progress through the grades or move to the higher levels.[41] The Court has examined the Amended Articles of Incorporation[42] and By-Laws[43] of the YMCA, but found nothing in them that even hints that it is a school or an educational institution.[44] Furthermore, under the Education Act of 1982, even non-formal education is understood to be school-based and private auspices such as foundations and civic-spirited organizations are ruled out.[45] It is settled that the term educational institution, when used in laws granting tax exemptions, refers to a xxx school seminary, college or educational establishment xxx.[46] Therefore, the private respondent cannot be deemed one of the educational institutions covered by the constitutional provision under consideration. xxx Words used in the Constitution are to be taken in their ordinary acceptation. While in its broadest and best sense education embraces all forms and phrases of instruction, improvement and development of mind and body, and as well of religious and moral sentiments, yet in the common understanding and application it means a place where systematic instruction in any or all of the useful branches of learning is given by methods common to schools and institutions of learning. That we conceive to be the true intent and scope of the term [educational institutions,] as used in the Constitution.[47]

Moreover, without conceding that Private Respondent YMCA is an educational institution, the Court also notes that the former did not submit proof of the proportionate amount of the subject income that was actually, directly and exclusively used for educational purposes. Article XIII, Section 5 of the YMCA by-laws, which formed part of the evidence submitted, is patently insufficient, since the same merely signified that [t]he net income derived from the rentals of the commercial buildings shall be apportioned to the Federation and Member Associations as the National Board may decide.[48] In sum, we find no basis for granting the YMCA exemption from income tax under the constitutional provision invoked

Cases Cited by Private Respondent Inapplicable The cases[49] relied on by private respondent do not support its cause. YMCA of Manila v. Collector of Internal Revenue[50] and Abra Valley College, Inc. v. Aquino[51] are not applicable, because the controversy in both cases involved exemption from the payment of property tax, not income tax. Hospital de San Juan de Dios, Inc. v. Pasay City[52]is not in point either, because it involves a claim for exemption from the payment of regulatory fees, specifically electrical inspection fees, imposed by an ordinance of Pasay City -- an issue not at all related to that involved in a claimed exemption from the payment if income taxes imposed on property leases. In Jesus Sacred Heart College v. Com. Of Internal Revenue,[53] the party therein, which claimed an exemption from the payment of income tax, was an educational institution which submitted substantial evidence that the income subject of the controversy had been devoted or used solely for educational purposes. On the other hand, the private respondent in the present case had not given any proof that it is an educational institution, or that of its rent income is actually, directly and exclusively used for educational purposes.

Epilogue In deliberating on this petition, the Court expresses its sympathy with private respondent. It appreciates the nobility its cause. However, the Courts power and function are limited merely to applying the law fairly and objectively. It cannot change the law or bend it to suit its sympathies and appreciations. Otherwise, it would be overspilling its role and invading the realm of legislation. We concede that private respondent deserves the help and the encouragement of the government. It needs laws that can facilitate, and not frustrate, its humanitarian tasks. But the Court regrets that, given its limited constitutional authority, it cannot rule on the wisdom or propriety of legislation. That prerogative belongs to the political departments of government. Indeed, some of the member of the Court may even believe in the wisdom and prudence of granting more tax exemptions to private respondent. But such belief, however well-meaning and sincere, cannot bestow upon the Court the power to change or amend the law. WHEREFORE, the petition is GRANTED. The Resolutions of the Court of Appeals dated September 28, 1995 and February 29, 1996 are hereby dated February 16, 1995 is REVERSED and SET ASIDE. The Decision of the Court of Appeals dated February 16, 1995 is REINSTATED, insofar as it ruled that the income tax. No pronouncement as to costs. SO ORDERED.

G.R. Nos. 120865-71 December 7, 1995 LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner, vs. COURT OF APPEALS; HON. JUDGE HERCULANO TECH, PRESIDING JUDGE, BRANCH 70, REGIONAL TRIAL COURT OF BINANGONAN RIZAL; FLEET DEVELOPMENT, INC. and CARLITO ARROYO; THE MUNICIPALITY OF BINANGONAN and/or MAYOR ISIDRO B. PACIS, respondents. LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner, vs. COURT OF APPEALS; HON. JUDGE AURELIO C. TRAMPE, PRESIDING JUDGE, BRANCH 163, REGIONAL TRIAL COURT OF PASIG; MANILA MARINE LIFE BUSINESS RESOURCES, INC. represented by, MR. TOBIAS REYNALD M.

TIANGCO; MUNICIPALITY OF TAGUIG, METRO MANILA and/or MAYOR RICARDO D. PAPA, JR., respondents. HERMOSISIMA, JR., J.: It is difficult for a man, scavenging on the garbage dump created by affluence and profligate consumption and extravagance of the rich or fishing in the murky waters of the Pasig River and the Laguna Lake or making a clearing in the forest so that he can produce food for his family, to understand why protecting birds, fish, and trees is more important than protecting him and keeping his family alive. How do we strike a balance between environmental protection, on the one hand, and the individual personal interests of people, on the other? Towards environmental protection and ecology, navigational safety, and sustainable development, Republic Act No. 4850 created the "Laguna Lake Development Authority." This Government Agency is supposed to carry out and effectuate the aforesaid declared policy, so as to accelerate the development and balanced growth of the Laguna Lake area and the surrounding provinces, cities and towns, in the act clearly named, within the context of the national and regional plans and policies for social and economic development. Presidential Decree No. 813 of former President Ferdinand E. Marcos amended certain sections of Republic Act No. 4850 because of the concern for the rapid expansion of Metropolitan Manila, the suburbs and the lakeshore towns of Laguna de Bay, combined with current and prospective uses of the lake for municipalindustrial water supply, irrigation, fisheries, and the like. Concern on the part of the Government and the general public over: — the environment impact of development on the water quality and ecology of the lake and its related river systems; the inflow of polluted water from the Pasig River, industrial, domestic and agricultural wastes from developed areas around the lake; the increasing urbanization which induced the deterioration of the lake, since water quality studies have shown that the lake will deteriorate further if steps are not taken to check the same; and the floods in Metropolitan Manila area and the lakeshore towns which will influence the hydraulic system of Laguna de Bay, since any scheme of controlling the floods will necessarily involve the lake and its river systems, — likewise gave impetus to the creation of the Authority. Section 1 of Republic Act No. 4850 was amended to read as follows: Sec. 1. Declaration of Policy. It is hereby declared to be the national policy to promote, and accelerate the development and balanced growth of the Laguna Lake area and the surrounding provinces, cities and towns hereinafter referred to as the region, within the context of the national and regional plans and policies for social and economic development and to carry out the development of the Laguna Lake region with due regard and adequate provisions for environmental management and control, preservation of the quality of human life and ecological systems, and the prevention of undue ecological disturbances, deterioration and pollution.1 Special powers of the Authority, pertinent to the issues in this case, include: Sec. 3. Section 4 of the same Act is hereby further amended by adding thereto seven new paragraphs to be known as paragraphs (j), (k), (l), (m), (n), (o), and (p) which shall read as follows: xxx xxx xxx (j) The provisions of existing laws to the contrary notwithstanding, to engage in fish production and other aqua-culture projects in Laguna de Bay and other bodies of water within its jurisdiction and in pursuance thereof to conduct studies and make experiments, whenever necessary, with the collaboration and assistance of the Bureau of Fisheries and Aquatic Resources, with the end in view of improving present techniques and practices. Provided, that until modified,

altered or amended by the procedure provided in the following sub-paragraph, the present laws, rules and permits or authorizations remain in force; (k) For the purpose of effectively regulating and monitoring activities in Laguna de Bay, the Authority shall have exclusive jurisdiction to issue new permit for the use of the lake waters for any projects or activities in or affecting the said lake including navigation, construction, and operation of fishpens, fish enclosures, fish corrals and the like, and to impose necessary safeguards for lake quality control and management and to collect necessary fees for said activities and projects: Provided, That the fees collected for fisheries may be shared between the Authority and other government agencies and political sub-divisions in such proportion as may be determined by the President of the Philippines upon recommendation of the Authority's Board: Provided, further, That the Authority's Board may determine new areas of fishery development or activities which it may place under the supervision of the Bureau of Fisheries and Aquatic Resources taking into account the overall development plans and programs for Laguna de Bay and related bodies of water: Provided, finally, That the Authority shall subject to the approval of the President of the Philippines promulgate such rules and regulations which shall govern fisheries development activities in Laguna de Bay which shall take into consideration among others the following: socio-economic amelioration of bonafide resident fishermen whether individually or collectively in the form of cooperatives, lakeshore town development, a master plan for fishpen construction and operation, communal fishing ground for lake shore town residents, and preference to lake shore town residents in hiring laborer for fishery projects; (l) To require the cities and municipalities embraced within the region to pass appropriate zoning ordinances and other regulatory measures necessary to carry out the objectives of the Authority and enforce the same with the assistance of the Authority; (m) The provisions of existing laws to the contrary notwithstanding, to exercise water rights over public waters within the Laguna de Bay region whenever necessary to carry out the Authority's projects; (n) To act in coordination with existing governmental agencies in establishing water quality standards for industrial, agricultural and municipal waste discharges into the lake and to cooperate with said existing agencies of the government of the Philippines in enforcing such standards, or to separately pursue enforcement and penalty actions as provided for in Section 4 (d) and Section 39-A of this Act: Provided, That in case of conflict on the appropriate water quality standard to be enforced such conflict shall be resolved thru the NEDA Board.2 To more effectively perform the role of the Authority under Republic Act No. 4850, as though Presidential Decree No. 813 were not thought to be completely effective, the Chief Executive, feeling that the land and waters of the Laguna Lake Region are limited natural resources requiring judicious management to their optimal utilization to insure renewability and to preserve the ecological balance, the competing options for the use of such resources and conflicting jurisdictions over such uses having created undue constraints on the institutional capabilities of the Authority in the light of the limited powers vested in it by its charter, Executive Order No. 927 further defined and enlarged the functions and powers of the Authority and named and enumerated the towns, cities and provinces encompassed by the term "Laguna de Bay Region". Also, pertinent to the issues in this case are the following provisions of Executive Order No. 927 which include in particular the sharing of fees:

Sec 2. Water Rights Over Laguna de Bay and Other Bodies of Water within the Lake Region: To effectively regulate and monitor activities in the Laguna de Bay region, the Authority shall have exclusive jurisdiction to issue permit for the use of all surface water for any projects or activities in or affecting the said region including navigation, construction, and operation of fishpens, fish enclosures, fish corrals and the like. For the purpose of this Executive Order, the term "Laguna de Bay Region" shall refer to the Provinces of Rizal and Laguna; the Cities of San Pablo, Pasay, Caloocan, Quezon, Manila and Tagaytay; the towns of Tanauan, Sto. Tomas and Malvar in Batangas Province; the towns of Silang and Carmona in Cavite Province; the town of Lucban in Quezon Province; and the towns of Marikina, Pasig, Taguig, Muntinlupa, and Pateros in Metro Manila. Sec 3. Collection of Fees. The Authority is hereby empowered to collect fees for the use of the lake water and its tributaries for all beneficial purposes including but not limited to fisheries, recreation, municipal, industrial, agricultural, navigation, irrigation, and waste disposal purpose; Provided, that the rates of the fees to be collected, and the sharing with other government agencies and political subdivisions, if necessary, shall be subject to the approval of the President of the Philippines upon recommendation of the Authority's Board, except fishpen fee, which will be shared in the following manner; 20 percent of the fee shall go to the lakeshore local governments, 5 percent shall go to the Project Development Fund which shall be administered by a Council and the remaining 75 percent shall constitute the share of LLDA. However, after the implementation within the three-year period of the Laguna Lake Fishery Zoning and Management Plan, the sharing will be modified as follows: 35 percent of the fishpen fee goes to the lakeshore local governments, 5 percent goes to the Project Development Fund and the remaining 60 percent shall be retained by LLDA; Provided, however, that the share of LLDA shall form part of its corporate funds and shall not be remitted to the National Treasury as an exception to the provisions of Presidential Decree No. 1234. (Emphasis supplied) It is important to note that Section 29 of Presidential Decree No. 813 defined the term "Laguna Lake" in this manner: Sec 41. Definition of Terms. (11) Laguna Lake or Lake. Whenever Laguna Lake or lake is used in this Act, the same shall refer to Laguna de Bay which is that area covered by the lake water when it is at the average annual maximum lake level of elevation 12.50 meters, as referred to a datum 10.00 meters below mean lower low water (M.L.L.W). Lands located at and below such elevation are public lands which form part of the bed of said lake. Then came Republic Act No. 7160, the Local Government Code of 1991. The municipalities in the Laguna Lake Region interpreted the provisions of this law to mean that the newly passed law gave municipal governments the exclusive jurisdiction to issue fishing privileges within their municipal waters because R.A. 7160 provides: Sec. 149. Fishery Rentals, Fees and Charges. (a) Municipalities shall have the exclusive authority to grant fishery privileges in the municipal waters and impose rental fees or charges therefor in accordance with the provisions of this Section. (b) The Sangguniang Bayan may: (1) Grant fishing privileges to erect fish corrals, oyster, mussel or other aquatic beds or bangus fry areas, within a definite zone of the municipal waters, as determined by it; . . . .

(2) Grant privilege to gather, take or catch bangus fry, prawn fry or kawagkawag or fry of other species and fish from the municipal waters by nets, traps or other fishing gears to marginal fishermen free from any rental fee, charges or any other imposition whatsoever. xxx xxx xxx Sec. 447. Power, Duties, Functions and Compensation. . . . . xxx xxx xxx (XI) Subject to the provisions of Book II of this Code, grant exclusive privileges of constructing fish corrals or fishpens, or the taking or catching of bangus fry, prawn fry or kawag-kawag or fry of any species or fish within the municipal waters. xxx xxx xxx Municipal governments thereupon assumed the authority to issue fishing privileges and fishpen permits. Big fishpen operators took advantage of the occasion to establish fishpens and fishcages to the consternation of the Authority. Unregulated fishpens and fishcages, as of July, 1995, occupied almost one-third of the entire lake water surface area, increasing the occupation drastically from 7,000 hectares in 1990 to almost 21,000 hectares in 1995. The Mayor's permit to construct fishpens and fishcages were all undertaken in violation of the policies adopted by the Authority on fishpen zoning and the Laguna Lake carrying capacity. To be sure, the implementation by the lakeshore municipalities of separate independent policies in the operation of fishpens and fishcages within their claimed territorial municipal waters in the lake and their indiscriminate grant of fishpen permits have already saturated the lake area with fishpens, thereby aggravating the current environmental problems and ecological stress of Laguna Lake. In view of the foregoing circumstances, the Authority served notice to the general public that: In compliance with the instructions of His Excellency PRESIDENT FIDEL V. RAMOS given on June 23, 1993 at Pila, Laguna pursuant to Republic Act 4850 as amended by Presidential Decree 813 and Executive Order 927 series of 1983 and in line with the policies and programs of the Presidential Task Force on Illegal Fishpens and Illegal Fishing, the general public is hereby notified that: 1. All fishpens, fishcages and other aqua-culture structures in the Laguna de Bay Region, which were not registered or to which no application for registration and/or permit has been filed with Laguna Lake Development Authority as of March 31, 1993 are hereby declared outrightly as illegal. 2. All fishpens, fishcages and other aqua-culture structures so declared as illegal shall be subject to demolition which shall be undertaken by the Presidential Task Force for Illegal Fishpen and Illegal Fishing. 3. Owners of fishpens, fishcages and other aqua-culture structures declared as illegal shall, without prejudice to demolition of their structures be criminally charged in accordance with Section 39-A of Republic Act 4850 as amended by P.D. 813 for violation of the same laws. Violations of these laws carries a penalty of imprisonment of not exceeding 3 years or a fine not exceeding Five Thousand Pesos or both at the discretion of the court. All operators of fishpens, fishcages and other aqua-culture structures declared as illegal in accordance with the foregoing Notice shall have one (1) month on or before 27 October 1993 to

show cause before the LLDA why their said fishpens, fishcages and other aqua-culture structures should not be demolished/dismantled. One month, thereafter, the Authority sent notices to the concerned owners of the illegally constructed fishpens, fishcages and other aqua-culture structures advising them to dismantle their respective structures within 10 days from receipt thereof, otherwise, demolition shall be effected. Reacting thereto, the affected fishpen owners filed injunction cases against the Authority before various regional trial courts, to wit: (a) Civil Case No. 759-B, for Prohibition, Injunction and Damages, Regional Trial Court, Branch 70, Binangonan, Rizal, filed by Fleet Development, Inc. and Carlito Arroyo; (b) Civil Case No. 64049, for Injunction, Regional Trial Court, Branch 162, Pasig, filed by IRMA Fishing and Trading Corp., ARTM Fishing Corp., BDR Corp., MIRT Corp. and TRIM Corp.; (c) Civil Case No. 566, for Declaratory Relief and Injunction, Regional Trial Court, Branch 163, Pasig, filed by Manila Marine Life Business Resources, Inc. and Tobias Reynaldo M. Tianco; (d) Civil Case No. 556-M, for Prohibition, Injunction and Damages, Regional Trial Court, Branch 78, Morong, Rizal, filed by AGP Fishing Ventures, Inc.; (e) Civil Case No. 522-M, for Prohibition, Injunction and Damages, Regional Trial Court, Branch 78, Morong, Rizal, filed by Blue Lagoon and Alcris Chicken Growers, Inc.; (f) Civil Case No. 554-, for Certiorari and Prohibition, Regional Trial Court, Branch 79, Morong, Rizal, filed by Greenfields Ventures Industrial Corp. and R.J. Orion Development Corp.; and (g) Civil Case No. 64124, for Injunction, Regional Trial Court, Branch 15, Pasig, filed by SEA-MAR Trading Co., Inc. and Eastern Lagoon Fishing Corp. and Minamar Fishing Corporation. The Authority filed motions to dismiss the cases against it on jurisdictional grounds. The motions to dismiss were invariably denied. Meanwhile, temporary restraining order/writs of preliminary mandatory injunction were issued in Civil Cases Nos. 64124, 759 and 566 enjoining the Authority from demolishing the fishpens and similar structures in question. Hence, the herein petition for certiorari, prohibition and injunction, G.R. Nos. 120865-71, were filed by the Authority with this court. Impleaded as parties-respondents are concerned regional trial courts and respective private parties, and the municipalities and/or respective Mayors of Binangonan, Taguig and Jala-jala, who issued permits for the construction and operation of fishpens in Laguna de Bay. The Authority sought the following reliefs, viz.: (A) Nullification of the temporary restraining order/writs of preliminary injunction issued in Civil Cases Nos. 64125, 759 and 566; (B) Permanent prohibition against the regional trial courts from exercising jurisdiction over cases involving the Authority which is a co-equal body; (C) Judicial pronouncement that R.A. 7610 (Local Government Code of 1991) did not repeal, alter or modify the provisions of R.A. 4850, as amended, empowering the Authority to issue permits for fishpens, fishcages and other aqua-culture structures in Laguna de Bay and that, the Authority the government agency vested with exclusive authority to issue said permits. By this Court's resolution of May 2, 1994, the Authority's consolidated petitions were referred to the Court of Appeals. In a Decision, dated June 29, 1995, the Court of Appeals dismissed the Authority's consolidated petitions, the Court of Appeals holding that: (A) LLDA is not among those quasi-judicial agencies of government whose decision or order are appealable only to the Court of Appeals; (B) the LLDA charter does vest LLDA with quasijudicial functions insofar as fishpens are concerned; (C) the provisions of the LLDA charter insofar as fishing privileges in Laguna de Bay are concerned had been repealed by the Local Government Code of 1991; (D) in view of the aforesaid repeal, the power to grant permits devolved to and is now vested with their respective local government units concerned.

Not satisfied with the Court of Appeals decision, the Authority has returned to this Court charging the following errors: 1. THE HONORABLE COURT OF APPEALS PROBABLY COMMITTED AN ERROR WHEN IT RULED THAT THE LAGUNA LAKE DEVELOPMENT AUTHORITY IS NOT A QUASI-JUDICIAL AGENCY. 2. THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR WHEN IT RULED THAT R.A. 4850 AS AMENDED BY P.D. 813 AND E.O. 927 SERIES OF 1983 HAS BEEN REPEALED BY REPUBLIC ACT 7160. THE SAID RULING IS CONTRARY TO ESTABLISHED PRINCIPLES AND JURISPRUDENCE OF STATUTORY CONSTRUCTION. 3. THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR WHEN IT RULED THAT THE POWER TO ISSUE FISHPEN PERMITS IN LAGUNA DE BAY HAS BEEN DEVOLVED TO CONCERNED (LAKESHORE) LOCAL GOVERNMENT UNITS. We take a simplistic view of the controversy. Actually, the main and only issue posed is: Which agency of the Government — the Laguna Lake Development Authority or the towns and municipalities comprising the region — should exercise jurisdiction over the Laguna Lake and its environs insofar as the issuance of permits for fishery privileges is concerned? Section 4 (k) of the charter of the Laguna Lake Development Authority, Republic Act No. 4850, the provisions of Presidential Decree No. 813, and Section 2 of Executive Order No. 927, cited above, specifically provide that the Laguna Lake Development Authority shall have exclusive jurisdiction to issue permits for the use of all surface water for any projects or activities in or affecting the said region, including navigation, construction, and operation of fishpens, fish enclosures, fish corrals and the like. On the other hand, Republic Act No. 7160, the Local Government Code of 1991, has granted to the municipalities the exclusive authority to grant fishery privileges in municipal waters. The Sangguniang Bayan may grant fishery privileges to erect fish corrals, oyster, mussels or other aquatic beds or bangus fry area within a definite zone of the municipal waters. We hold that the provisions of Republic Act No. 7160 do not necessarily repeal the aforementioned laws creating the Laguna Lake Development Authority and granting the latter water rights authority over Laguna de Bay and the lake region. The Local Government Code of 1991 does not contain any express provision which categorically expressly repeal the charter of the Authority. It has to be conceded that there was no intent on the part of the legislature to repeal Republic Act No. 4850 and its amendments. The repeal of laws should be made clear and expressed. It has to be conceded that the charter of the Laguna Lake Development Authority constitutes a special law. Republic Act No. 7160, the Local Government Code of 1991, is a general law. It is basic in statutory construction that the enactment of a later legislation which is a general law cannot be construed to have repealed a special law. It is a well-settled rule in this jurisdiction that "a special statute, provided for a particular case or class of cases, is not repealed by a subsequent statute, general in its terms, provisions and application, unless the intent to repeal or alter is manifest, although the terms of the general law are broad enough to include the cases embraced in the special law."3 Where there is a conflict between a general law and a special statute, the special statute should prevail since it evinces the legislative intent more clearly than the general statute. The special law is to be taken as an exception to the general law in the absence of special circumstances forcing a contrary conclusion. This is because implied repeals are not favored and as much as possible, effect must be given to all enactments of the legislature. A special law cannot be repealed, amended or altered by a subsequent general law by mere implication.4 Thus, it has to be concluded that the charter of the Authority should prevail over the Local Government Code of 1991.

Considering the reasons behind the establishment of the Authority, which are environmental protection, navigational safety, and sustainable development, there is every indication that the legislative intent is for the Authority to proceed with its mission. We are on all fours with the manifestation of petitioner Laguna Lake Development Authority that "Laguna de Bay, like any other single body of water has its own unique natural ecosystem. The 900 km² lake surface water, the eight (8) major river tributaries and several other smaller rivers that drain into the lake, the 2,920 km² basin or watershed transcending the boundaries of Laguna and Rizal provinces, greater portion of Metro Manila, parts of Cavite, Batangas, and Quezon provinces, constitute one integrated delicate natural ecosystem that needs to be protected with uniform set of policies; if we are to be serious in our aims of attaining sustainable development. This is an exhaustible natural resource — a very limited one — which requires judicious management and optimal utilization to ensure renewability and preserve its ecological integrity and balance." "Managing the lake resources would mean the implementation of a national policy geared towards the protection, conservation, balanced growth and sustainable development of the region with due regard to the inter-generational use of its resources by the inhabitants in this part of the earth. The authors of Republic Act 4850 have foreseen this need when they passed this LLDA law — the special law designed to govern the management of our Laguna de Bay lake resources." "Laguna de Bay therefore cannot be subjected to fragmented concepts of management policies where lakeshore local government units exercise exclusive dominion over specific portions of the lake water. The garbage thrown or sewage discharged into the lake, abstraction of water therefrom or construction of fishpens by enclosing its certain area, affect not only that specific portion but the entire 900 km² of lake water. The implementation of a cohesive and integrated lake water resource management policy, therefore, is necessary to conserve, protect and sustainably develop Laguna de Bay."5 The power of the local government units to issue fishing privileges was clearly granted for revenue purposes. This is evident from the fact that Section 149 of the New Local Government Code empowering local governments to issue fishing permits is embodied in Chapter 2, Book II, of Republic Act No. 7160 under the heading, "Specific Provisions On The Taxing And Other Revenue Raising Power Of Local Government Units." On the other hand, the power of the Authority to grant permits for fishpens, fishcages and other aqua-culture structures is for the purpose of effectively regulating and monitoring activities in the Laguna de Bay region (Section 2, Executive Order No. 927) and for lake quality control and management.6 It does partake of the nature of police power which is the most pervasive, the least limitable and the most demanding of all State powers including the power of taxation. Accordingly, the charter of the Authority which embodies a valid exercise of police power should prevail over the Local Government Code of 1991 on matters affecting Laguna de Bay. There should be no quarrel over permit fees for fishpens, fishcages and other aqua-culture structures in the Laguna de Bay area. Section 3 of Executive Order No. 927 provides for the proper sharing of fees collected. In respect to the question as to whether the Authority is a quasi-judicial agency or not, it is our holding that, considering the provisions of Section 4 of Republic Act No. 4850 and Section 4 of Executive Order No. 927, series of 1983, and the ruling of this Court in Laguna Lake Development Authority vs. Court of Appeals, 231 SCRA 304, 306, which we quote: xxx xxx xxx As a general rule, the adjudication of pollution cases generally pertains to the Pollution Adjudication Board (PAB), except in cases where the special law provides for another forum. It must be recognized in this regard that the LLDA, as a specialized administrative agency, is specifically mandated under Republic Act No. 4850 and its amendatory laws to carry out and make effective the declared national policy of promoting and accelerating the development and balanced growth of the Laguna Lake area and the surrounding provinces of Rizal and Laguna

and the cities of San Pablo, Manila, Pasay, Quezon and Caloocan with due regard and adequate provisions for environmental management and control, preservation of the quality of human life and ecological systems, and the prevention of undue ecological disturbances, deterioration and pollution. Under such a broad grant of power and authority, the LLDA, by virtue of its special charter, obviously has the responsibility to protect the inhabitants of the Laguna Lake region from the deleterious effects of pollutants emanating from the discharge of wastes from the surrounding areas. In carrying out the aforementioned declared policy, the LLDA is mandated, among others, to pass upon and approve or disapprove all plans, programs, and projects proposed by local government offices/agencies within the region, public corporations, and private persons or enterprises where such plans, programs and/or projects are related to those of the LLDA for the development of the region. xxx xxx xxx . . . . While it is a fundamental rule that an administrative agency has only such powers as are expressly granted to it by law, it is likewise a settled rule that an administrative agency has also such powers as are necessarily implied in the exercise of its express powers. In the exercise, therefore, of its express powers under its charter, as a regulatory and quasi-judicial body with respect to pollution cases in the Laguna Lake region, the authority of the LLDA to issue a "cease and desist order" is, perforce, implied. Otherwise, it may well be reduced to a "toothless" paper agency. there is no question that the Authority has express powers as a regulatory and quasi-judicial body in respect to pollution cases with authority to issue a "cease and desist order" and on matters affecting the construction of illegal fishpens, fishcages and other aqua-culture structures in Laguna de Bay. The Authority's pretense, however, that it is co-equal to the Regional Trial Courts such that all actions against it may only be instituted before the Court of Appeals cannot be sustained. On actions necessitating the resolution of legal questions affecting the powers of the Authority as provided for in its charter, the Regional Trial Courts have jurisdiction. In view of the foregoing, this Court holds that Section 149 of Republic Act No. 7160, otherwise known as the Local Government Code of 1991, has not repealed the provisions of the charter of the Laguna Lake Development Authority, Republic Act No. 4850, as amended. Thus, the Authority has the exclusive jurisdiction to issue permits for the enjoyment of fishery privileges in Laguna de Bay to the exclusion of municipalities situated therein and the authority to exercise such powers as are by its charter vested on it. Removal from the Authority of the aforesaid licensing authority will render nugatory its avowed purpose of protecting and developing the Laguna Lake Region. Otherwise stated, the abrogation of this power would render useless its reason for being and will in effect denigrate, if not abolish, the Laguna Lake Development Authority. This, the Local Government Code of 1991 had never intended to do. WHEREFORE, the petitions for prohibition, certiorari and injunction are hereby granted, insofar as they relate to the authority of the Laguna Lake Development Authority to grant fishing privileges within the Laguna Lake Region. The restraining orders and/or writs of injunction issued by Judge Arturo Marave, RTC, Branch 78, Morong, Rizal; Judge Herculano Tech, RTC, Branch 70, Binangonan, Rizal; and Judge Aurelio Trampe, RTC, Branch 163, Pasig, Metro Manila, are hereby declared null and void and ordered set aside for having been issued with grave abuse of discretion. The Municipal Mayors of the Laguna Lake Region are hereby prohibited from issuing permits to construct and operate fishpens, fishcages and other aqua-culture structures within the Laguna Lake Region, their previous issuances being declared null and void. Thus, the fishing permits issued by Mayors Isidro B. Pacis, Municipality of Binangonan; Ricardo D. Papa, Municipality of Taguig; and Walfredo M. de la Vega, Municipality of Jala-jala, specifically, are likewise declared null and void and ordered cancelled.

The fishpens, fishcages and other aqua-culture structures put up by operators by virtue of permits issued by Municipal Mayors within the Laguna Lake Region, specifically, permits issued to Fleet Development, Inc. and Carlito Arroyo; Manila Marine Life Business Resources, Inc., represented by, Mr. Tobias Reynald M. Tiangco; Greenfield Ventures Industrial Development Corporation and R.J. Orion Development Corporation; IRMA Fishing And Trading Corporation, ARTM Fishing Corporation, BDR Corporation, Mirt Corporation and Trim Corporation; Blue Lagoon Fishing Corporation and ALCRIS Chicken Growers, Inc.; AGP Fish Ventures, Inc., represented by its President Alfonso Puyat; SEA MAR Trading Co., Inc., Eastern Lagoon Fishing Corporation, and MINAMAR Fishing Corporation, are hereby declared illegal structures subject to demolition by the Laguna Lake Development Authority. SO ORDERED.

[G.R. No. 132601. October 12, 1998]

LEO ECHEGARAY y PILO, petitioner, vs. THE SECRETARY OF JUSTICE and THE DIRECTOR OF THE BUREAU OF CORRECTIONS, THE EXECUTIVE JUDGE OF THE REGIONAL TRIAL COURT OF QUEZON CITY AND THE PRESIDING JUDGE OF REGIONAL TRIAL COURT OF QUEZON CITY, BRANCH 104, respondents. DECISION PER CURIAM: On June 25, 1996, this Court affirmed[1] the conviction of petitioner Leo Echegaray y Pilo for the crime of rape of the 10 year-old daughter of his common-law spouse and the imposition upon him of the death penalty for the said crime. Petitioner duly filed a Motion for Reconsideration raising mainly factual issues, and on its heels, a Supplemental Motion for Reconsideration raising for the first time the issue of the constitutionality of Republic Act No. 7659 [2] (the death penalty law) and the imposition of the death penalty for the crime of rape. On February 7, 1998, this Court denied[3] petitioner's Motion for Reconsideration and Supplemental Motion for Reconsideration with a finding that Congress duly complied with the requirements for the reimposition of the death penalty and therefore the death penalty law is not unconstitutional. In the meantime, Congress had seen it fit to change the mode of execution of the death penalty from electrocution to lethal injection,[4] and passed Republic Act No. 8177, AN ACT DESIGNATING DEATH BY LETHAL INJECTION AS THE METHOD OF CARRYING OUT CAPITAL PUNISHMENT, AMENDING FOR THE PURPOSE ARTICLE 81 OF THE REVISED PENAL CODE, AS AMENDED BY SECTION 24 OF REPUBLIC ACT NO. 7659.[5] Pursuant to the provisions of said law, the Secretary of Justice promulgated the Rules and Regulations to Implement Republic Act No. 8177 ("implementing rules")[6] and directed the Director of the Bureau of Corrections to prepare the Lethal Injection Manual.[7] On March 2, 1998, petitioner filed a Petition[8] for Prohibition, Injunction and/or Temporary Restraining Order to enjoin respondents Secretary of Justice and Director of the Bureau of Prisons from carrying out the execution by lethal injection of petitioner under R.A. No. 8177 and its implementing rules as these are unconstitutional and void for being: (a) cruel, degrading and inhuman punishment per se as well as by reason of its being (b) arbitrary, unreasonable and a violation of due process, (c) a violation of the Philippines' obligations under international covenants, (d) an undue delegation of legislative power by Congress, (e) an unlawful exercise by respondent Secretary of the power to legislate, and (f) an unlawful delegation of delegated powers by the Secretary of Justice to respondent Director. On March 3, 1998, petitioner, through counsel, filed a Motion for Leave of Court [9] to Amend and Supplement Petition with the Amended and Supplemental Petition[10]attached thereto, invoking the additional ground of violation of equal protection, and impleading the Executive Judge of the Regional Trial Court of Quezon City and the Presiding Judge of the Regional Trial Court, Branch 104, in order to enjoin said public respondents from acting under the questioned rules by setting a date for petitioner's execution.

On March 3, 1998, the Court resolved, without giving due course to the petition, to require the respondents to COMMENT thereon within a non-extendible period of ten (10) days from notice, and directed the parties "to MAINTAIN the status quo prevailing at the time of the filing of this petition." On March 10, 1998, the Court granted the Motion for Leave of Court to Amend and Supplement Petition, and required respondents to COMMENT thereon within ten (10) days from notice. On March 16, 1998, petitioner filed a Very Urgent Motion (1) To clarify Status Quo Order, and (2) For the Issuance of a Temporary Restraining Order expressly enjoining public respondents from taking any action to carry out petitioner's execution until the petition is resolved. On March 16, 1998, the Office of the Solicitor General[11] filed a Comment (On the Petition and the Amended Supplemental Petition)[12] stating that (1) this Court has already upheld the constitutionality of the Death Penalty Law, and has repeatedly declared that the death penalty is not cruel, unjust, excessive or unusual punishment; (2) execution by lethal injection, as authorized under R.A. No. 8177 and the questioned rules, is constitutional, lethal injection being the most modern, more humane, more economical, safer and easier to apply (than electrocution or the gas chamber); (3) the International Covenant on Civil and Political Rights does not expressly or impliedly prohibit the imposition of the death penalty; (4) R.A. No. 8177 properly delegated legislative power to respondent Director; and that (5) R.A. No. 8177 confers the power to promulgate the implementing rules to the Secretary of Justice, Secretary of Health and the Bureau of Corrections. On March 17, 1998, the Court required the petitioner to file a REPLY thereto within a non-extendible period of ten days from notice. On March 25, 1998, the Commission on Human Rights[13] filed a Motion for Leave of Court to Intervene and/or Appear as Amicus Curiae[14] with the attached Petition to Intervene and/or Appear as Amicus Curiae[15] alleging that the death penalty imposed under R.A. No. 7659 which is to be implemented by R.A. No. 8177 is cruel, degrading and outside the limits of civil society standards, and further invoking (a) Article II, Section 11 of the Constitution which provides: "The State values the dignity of every human person and guarantees full respect for human rights."; (b) Article III of the Universal Declaration of Human Rights which states that "Everyone has the right to life, liberty and security of person," and Article V thereof, which states that "No one shall be subjected to torture or to cruel, inhuman or degrading treatment or punishment."; (c) The International Covenant on Civil and Political Rights, in particular, Article 6 thereof, and the Second Optional Protocol to the International Covenant on Civil and Political Rights Aiming At The Abolition of the Death Penalty; (d) Amnesty International statistics showing that as of October 1996, 58 countries have abolished the death penalty for all crimes, 15 countries have abolished the death penalty for ordinary crimes, and 26 countries are abolitionists de facto, which means that they have retained the death penalty for ordinary crimes but are considered abolitionists in practice that they have not executed anyone during the past ten (10) years or more, or in that they have made an international commitment not to carry out executions, for a total of 99 countries which are total abolitionists in law or practice, and 95 countries as retentionists;[16] and (e) Pope John Paul II's encyclical, "Evangelium Vitae." In a Resolution dated April 3, 1998, the Court duly noted the motion. On March 27, 1998, petitioner filed a Reply[17] stating that (1) this Court is not barred from exercising judicial review over the death penalty per se, the death penalty for rape and lethal injection as a mode of carrying out the death penalty; (2) capital punishment is a cruel, degrading and inhuman punishment; (3) lethal injection is cruel, degrading and inhuman punishment, and that being the "most modern" does not make it less cruel or more humane, and that the Solicitor General's "aesthetic" criteria is short-sighted, and that the lethal injection is not risk free nor is it easier to implement; and (4) the death penalty violates the International Covenant on Civil and Political Rights considering that the Philippines participated in the deliberations of and voted for the Second Optional Protocol. After deliberating on the pleadings, the Court gave due course to the petition, which it now resolves on the merits. In the Amended and Supplemental Petition, petitioner assails the constitutionality of the mode of carrying out his death sentence by lethal injection on the following grounds:[18] I. DEATH BY LETHAL INJECTION IS UNCONSTITUTIONAL FOR BEING A CRUEL, DEGRADING AND INHUMAN PUNISHMENT. II.

THE DEATH PENALTY VIOLATES THE INTERNATIONAL COVENANT ON CIVIL AND POLITICAL RIGHTS, WHICH IS PART OF THE LAW OF THE LAND. III. LETHAL INJECTION, AS AUTHORIZED UNDER REPUBLIC ACT NO. 8177 AND THE QUESTIONED RULES, IS UNCONSTITUTIONAL BECAUSE IT IS AN UNNECESSARY AND WANTON INFLICTION OF PAIN ON A PERSON AND IS, THUS, A CRUEL, DEGRADING, AND INHUMAN PUNISHMENT. IV. REPUBLIC ACT NO. 8177 UNDULY DELEGATES LEGISLATIVE POWER TO RESPONDENT DIRECTOR. V. RESPONDENT SECRETARY UNLAWFULLY DELEGATED THE LEGISLATIVE POWERS DELEGATED TO HIM UNDER REPUBLIC ACT NO. 8177 TO RESPONDENT DIRECTOR. VI. RESPONDENT SECRETARY EXCEEDED THE AUTHORITY DELEGATED TO HIM UNDER REPUBLIC ACT NO. 8177 AND UNLAWFULLY USURPED THE POWER TO LEGISLATE IN PROMULGATING THE QUESTIONED RULES. VII. SECTION 17 OF THE QUESTIONED RULES IS UNCONSTITUTIONAL FOR BEING DISCRIMINATORY AS WELL AS FOR BEING AN INVALID EXERCISE BY RESPONDENT SECRETARY OF THE POWER TO LEGISLATE. VIII. INJUCTION MUST ISSUE TO PREVENT IRREPARABLE DAMAGE AND INJURY TO PETITIONER'S RIGHTS BY REASON OF THE EXISTENCE, OPERATION AND IMPLEMENTATION OF AN UNCONSTITUTIONAL STATUTE AND EQUALLY INVALID AND IMPLEMENTING RULES. Concisely put, petitioner argues that R.A. No. 8177 and its implementing rules do not pass constitutional muster for: (a) violation of the constitutional proscription against cruel, degrading or inhuman punishment, (b) violation of our international treaty obligations, (c) being an undue delegation of legislative power, and (d) being discriminatory. The Court shall now proceed to discuss these issues in seriatim. I. LETHAL INJECTION, NOT CRUEL, DEGRADING OR INHUMAN PUNISHMENT UNDER SECTION 19, ARTICLE III OF THE 1987 CONSTITUTION. The main challenge to R.A. 8177 and its implementing rules is anchored on Article III, Section 19 (1) of the 1987 Constitution which proscribes the imposition of "cruel, degrading or inhuman" punishment. "The prohibition in the Philippine Bill against cruel and unusual punishments is an Anglo-Saxon safeguard against governmental oppression of the subject, which made its first appearance in the reign of William and Mary of England in 'An Act declaring the rights and liberties of the subject, and settling the succession of the crown,' passed in the year 1689. It has been incorporated into the Constitution of the United States (of America) and into most constitutions of the various States in substantially the same language as that used in the original statute. The exact language of the Constitution of the United States is used in the Philippine Bill."[19] "The counterpart of Section 19 (1) in the 1935 Constitution reads: 'Excessive fines shall not be imposed, nor cruel and inhuman punishment inflicted.' xxx In the 1973 Constitution the phrase became 'cruel or unusual punishment.' The Bill of Rights Committee of the 1986 Constitutional Commission read the 1973 modification as

prohibiting 'unusual' punishment even if not 'cruel.' It was thus seen as an obstacle to experimentation in penology. Consequently, the Committee reported out the present text which prohibits 'cruel, degrading or inhuman punishment' as more consonant with the meaning desired and with jurisprudence on the subject." [20] Petitioner contends that death by lethal injection constitutes cruel, degrading and inhuman punishment considering that (1) R.A. No. 8177 fails to provide for the drugs to be used in carrying out lethal injection, the dosage for each drug to be administered, and the procedure in administering said drug/s into the accused; (2) R.A. No. 8177 and its implementing rules are uncertain as to the date of the execution, time of notification, the court which will fix the date of execution, which uncertainties cause the greatest pain and suffering for the convict; and (3) the possibility of "botched executions" or mistakes in administering the drugs renders lethal injection inherently cruel. Before the Court proceeds any further, a brief explanation of the process of administering lethal injection is in order. In lethal injection, the condemned inmate is strapped on a hospital gurney and wheeled into the execution room. A trained technician inserts a needle into a vein in the inmate's arm and begins an intravenous flow of saline solution. At the warden's signal, a lethal combination of drugs is injected into the intravenous line. The deadly concoction typically includes three drugs: (1) a nonlethal dose of sodium thiopenthotal, a sleep inducing barbiturate; (2) lethal doses of pancuronium bromide, a drug that paralyzes the muscles; and (3) potassium chloride, which stops the heart within seconds. The first two drugs are commonly used during surgery to put the patient to sleep and relax muscles; the third is used in heart bypass surgery.[21] Now it is well-settled in jurisprudence that the death penalty per se is not a cruel, degrading or inhuman punishment.[22] In the oft-cited case of Harden v. Director of Prisons,[23] this Court held that "[p]unishments are cruel when they involve torture or a lingering death; but the punishment of death is not cruel, within the meaning of that word as used in the constitution. It implies there something inhuman and barbarous, something more than the mere extinguishment of life." Would the lack in particularity then as to the details involved in the execution by lethal injection render said law "cruel, degrading or inhuman"? The Court believes not. For reasons hereafter discussed, the implementing details of R.A. No. 8177 are matters which are properly left to the competence and expertise of administrative officials.[24] Petitioner contends that Sec. 16[25] of R.A. No. 8177 is uncertain as to which "court" will fix the time and date of execution, and the date of execution and time of notification of the death convict. As petitioner already knows, the "court" which designates the date of execution is the trial court which convicted the accused, that is, after this Court has reviewed the entire records of the case[26] and has affirmed the judgment of the lower court. Thereupon, the procedure is that the "judgment is entered fifteen (15) days after its promulgation, and 10 days thereafter, the records are remanded to the court below including a certified copy of the judgment for execution.[27] Neither is there any uncertainty as to the date of execution nor the time of notification. As to the date of execution, Section 15 of the implementing rules must be read in conjunction with the last sentence of Section 1 of R.A. No. 8177 which provides that the death sentence shall be carried out "not earlier than one (1) year nor later then eighteen (18) months from the time the judgment imposing the death penalty became final and executory, without prejudice to the exercise by the President of his executive clemency powers at all times." Hence, the death convict is in effect assured of eighteen (18) months from the time the judgment imposing the death penalty became final and executory[28] wherein he can seek executive clemency[29]and attend to all his temporal and spiritual affairs.[30] Petitioner further contends that the infliction of "wanton pain" in case of possible complications in the intravenous injection, considering and as petitioner claims, that respondent Director is an untrained and untested person insofar as the choice and administration of lethal injection is concerned, renders lethal injection a cruel, degrading and inhuman punishment. Such supposition is highly speculative and unsubstantiated. First. Petitioner has neither alleged nor presented evidence that lethal injection required the expertise only of phlebotomists and not trained personnel and that the drugs to be administered are unsafe or ineffective.[31] Petitioner simply cites situations in the United States wherein execution by lethal injection allegedly resulted in prolonged and agonizing death for the convict,[32] without any other evidence whatsoever. Second. Petitioner overlooked Section 1, third paragraph of R.A. No. 8177 which requires that all personnel involved in the execution proceedings should be trained prior to the performance of such task. We must presume that the public officials entrusted with the implementation of the death penalty (by lethal injection) will carefully avoid inflicting cruel punishment.[33] Third. Any infliction of pain in lethal injection is merely incidental in carrying out the execution of death penalty and does not fall within the constitutional proscription against cruel, degrading and inhuman punishment. "In a limited sense,

anything is cruel which is calculated to give pain or distress, and since punishment imports pain or suffering to the convict, it may be said that all punishments are cruel. But of course the Constitution does not mean that crime, for this reason, is to go unpunished."[34] The cruelty against which the Constitution protects a convicted man is cruelty inherent in the method of punishment, not the necessary suffering involved in any method employed to extinguish life humanely. [35] Numerous federal and state courts of the United States have been asked to review whether lethal injections constitute cruel and unusual punishment.No court has found lethal injections to implicate prisoner's Eighth Amendment rights. In fact, most courts that have addressed the issue state in one or two sentences that lethal injection clearly is a constitutional form of execution.[36] A few jurisdictions, however, have addressed the merits of the Eighth Amendment claims. Without exception, these courts have found that lethal injection does not constitute cruel and unusual punishment. After reviewing the medical evidence that indicates that improper doses or improper administration of the drugs causes severe pain and that prison officials tend to have little training in the administration of the drugs, the courts have found that the few minutes of pain does not rise to a constitutional violation.[37] What is cruel and unusual "is not fastened to the obsolete but may acquire meaning as public opinion becomes enlightened by a humane justice" and "must draw its meaning from the evolving standards of decency that mark the progress of a maturing society."[38] Indeed, "[o]ther (U.S.) courts have focused on 'standards of decency' finding that the widespread use of lethal injections indicates that it comports with contemporary norms." [39] the primary indicator of society's standard of decency with regard to capital punishment is the response of the country's legislatures to the sanction.[40] Hence, for as long as the death penalty remains in our statute books and meets the most stringent requirements provided by the Constitution, we must confine our inquiry to the legality of R.A. No. 8177, whose constitutionality we duly sustain in the face of petitioner's challenge. We find that the legislature's substitution of the mode of carrying out the death penalty from electrocution to lethal injection infringes no constitutional rights of petitioner herein. II. REIMPOSITION OF THE DEATH PENALTY LAW DOES NOT VIOLATE INTERNATIONAL TREATY OBLIGATIONS Petitioner assiduously argues that the reimposition of the death penalty law violates our international obligations, in particular, the International Covenant on Civil And Political Rights, which was adopted by the General Assembly of the United Nations on December 16, 1996, signed and ratified by the Philippines on December 19, 1966 and October 23, 1986,[41] respectively. Article 6 of the International Covenant on Civil and Political Rights provides: "1. Every human being has the inherent right to life. This right shall be protected by law. No one shall be arbitrarily deprived of his life. 2. In countries which have not abolished the death penalty, sentence of death may be imposed only for the most serious crimes in accordance with the law in force at the time of the commission of the crime and not contrary to the provisions of the present Covenant and to the Convention on the Prevention and Punishment of the Crime of Genocide. This penalty can only be carried out pursuant to a final judgment rendered by a competent court." (emphasis supplied) 3. When deprivation of life constitutes the crime of genocide, it is understood that nothing in this article shall authorize any State Party to the present Covenant to derogate in any way from any obligation assumed under the provisions of the Convention on the Prevention and Punishment of the Crime of Genocide. 4. Anyone sentenced to death shall have the right to seek pardon or commutation of the sentence. Amnesty, pardon or commutation of the sentence of death may be granted in all-cases. 5. Sentence of death shall not be imposed for crimes committed by persons below eighteen years of age and shall not be carried out on pregnant women. 6. Nothing in this article shall be invoked to delay or to prevent the abolition of capital punishment by any State. Party to the present Covenant." Indisputably, Article 6 of the Covenant enshrines the individual's right to life. Nevertheless, Article 6 (2) of the Covenant explicitly recognizes that capital punishment is an allowable limitation on the right to life, subject to the limitation that it be imposed for the "most serious crimes". Pursuant to Article 28 of the Covenant, a Human Rights

Committee was established and under Article 40 of the Covenant, State parties to the Covenant are required to submit an initial report to the Committee on the measures they have adopted which give effect to the rights recognized within the Covenant and on the progress made on the enjoyment of those rights one year of its entry into force for the State Party concerned and thereafter, after five years. On July 27, 1982, the Human Rights Committee issued General Comment No. 6 interpreting Article 6 of the Covenant stating that "(while) it follows from Article 6 (2) to (6) that State parties are not obliged to abolish the death penalty totally, they are obliged to limit its use and, in particular, to abolish it for other than the 'most serious crimes.' Accordingly, they ought to consider reviewing their criminal laws in this light and, in any event, are obliged to restrict the application of the death penalty to the most serious crimes.' The article strongly suggests (pars. 2 (2) and (6) that abolition is desirable. xxx The Committee is of the opinion that the expression 'most serious crimes' must be read restrictively to mean that the death penalty should be a quite exceptional measure." Further, the Safeguards Guaranteeing Protection of Those Facing the Death Penalty[42] adopted by the Economic and Social Council of the United Nations declare that the ambit of the term 'most serious crimes' should not go beyond intentional crimes, with lethal or other extremely grave consequences. The Optional Protocol to the International Covenant on Civil and Political Rights was adopted by the General Assembly of the United Nations on December 16, 1966, and signed and ratified by the Philippines on December 19, 1966 and August 22, 1989,[43] respectively. The Optional Protocol provides that the Human Rights Committee shall receive and consider communications from individuals claiming to be victims of violations of any of the rights set forth in the Covenant. On the other hand, the Second Optional Protocol to the International Covenant on Civil and Political Rights, Aiming at the Abolition of the Death Penalty was adopted by the General Assembly on December 15, 1989. The Philippines neither signed nor ratified said document.[44] Evidently, petitioner's assertion of our obligation under the Second Optional Protocol is misplaced. III. THERE IS NO UNDUE DELEGATION OF LEGISLATIVE POWER IN R.A. NO. 8177 TO THE SECRETARY OF JUSTICE AND THE DIRECTOR OF BUREAU OF CORRECTIONS, BUT SECTION 19 OF THE RULES AND REGULATIONS TO IMPLEMENT R.A. NO. 8177 IS INVALID. The separation of powers is a fundamental principle in our system of government. It obtains not through express provision but by actual division in the framing of our Constitution. Each department of the government has exclusive cognizance of matters placed within its jurisdiction, and is supreme within its own sphere. [45] Corollary to the doctrine of separation of powers is the principle of non-delegation of powers. "The rule is that what has been delegated, cannot be delegated or as expressed in a Latin maxim: potestas delegata non delegari potest."[46] The recognized exceptions to the rule are as follows: (1) Delegation of tariff powers to the President under Section 28 (2) of Article VI of the Constitution; (2) Delegation of emergency powers to the President under Section 23 (2) of Article VI of the Constitution; (3) Delegation to the people at large; (4) Delegation to local governments; and (5) Delegation to administrative bodies.[47] Empowering the Secretary of Justice in conjunction with the Secretary of Health and the Director of the Bureau of Corrections, to promulgate rules and regulations on the subject of lethal injection is a form of delegation of legislative authority to administrative bodies. The reason for delegation of authority to administrative agencies is the increasing complexity of the task of government requiring expertise as well as the growing inability of the legislature to cope directly with the myriad problems demanding its attention. The growth of society has ramified its activities and created peculiar and sophisticated problems that the legislature cannot be expected to attend to by itself. Specialization even in legislation has become necessary. On many problems involving day-to-day undertakings, the legislature may not have the needed competence to provide the required direct and efficacious, not to say, specific solutions. These solutions may, however, be expected from its delegates, who are supposed to be experts in the particular fields assigned to them.[48] Although Congress may delegate to another branch of the Government the power to fill in the details in the execution, enforcement or administration of a law, it is essential, to forestall a violation of the principle of separation of powers, that said law: (a) be complete in itself - it must set forth therein the policy to be executed, carried out or implemented by the

delegate[49] - and (b) fix a standard - the limits of which are sufficiently determinate or determinable - to which the delegate must conform in the performance of his functions.[50] Considering the scope and the definiteness of R.A. No. 8177, which changed the mode of carrying out the death penalty, the Court finds that the law sufficiently describes what job must be done, who is to do it, and what is the scope of his authority.[51] R.A. No. 8177 likewise provides the standards which define the legislative policy, mark its limits, map out its boundaries, and specify the public agencies which will apply it.it indicates the circumstances under which the legislative purpose may be carried out.[52] R.A. No. 8177 specifically requires that "[t]he death sentence shall be executed under the authority of the Director of the Bureau of Corrections, endeavoring so far as possible to mitigate the sufferings of the person under the sentence during the lethal injection as well as during the proceedings prior to the execution."[53] Further, "[t]he Director of the Bureau of Corrections shall take steps to ensure that the lethal injection to be administered is sufficient to cause the instantaneous death of the convict."[54] The legislature also mandated that "all personnel involved in the administration of lethal injection shall be trained prior to the performance of such task."[55] The Court cannot see that any useful purpose would be served by requiring greater detail. [56] The question raised is not the definition of what constitutes a criminal offense,[57] but the mode of carrying out the penalty already imposed by the Courts. In this sense, R.A. No. 8177 is sufficiently definite and the exercise of discretion by the administrative officials concerned is, to use the words of Justice Benjamin Cardozo, canalized within banks that keep it from overflowing. Thus, the Court finds that the existence of an area for exercise of discretion by the Secretary of Justice and the Director of the Bureau of Corrections under delegated legislative power is proper where standards are formulated for the guidance and the exercise of limited discretion, which though general, are capable of reasonable application.[58] It is also noteworthy that Article 81 of the Revised Penal Code which originally provided for the death penalty by electrocution was not subjected to attack on the ground that it failed to provide for details such as the kind of chair to be used, the amount of voltage, volume of amperage or place of attachment of electrodes on the death convict. Hence, petitioner's analogous argument with respect to lethal injection must fail. A careful reading of R.A. No. 8177 would show that there is no undue delegation of legislative power from the Secretary of Justice to the Director of the Bureau of Corrections for the simple reason that under the Administrative Code of 1987, the Bureau of Corrections is a mere constituent unit of the Department of Justice. [59] Further, the Department of Justice is tasked, among others, to take charge of the "administration of the correctional system." [60] Hence, the import of the phraseology of the law is that the Secretary of Justice should supervise the Director of the Bureau of Corrections in promulgating the Lethal Injection Manual, in consultation with the Department of Health.[61] However, the Rules and Regulations to Implement Republic Act No. 8177 suffer serious flaws that could not be overlooked. To begin with, something basic appears missing in Section 19 of the implementing rules which provides: "SEC. 19. EXECUTION PROCEDURE. - Details of the procedure prior to, during and after administering the lethal injection shall be set forth in a manual to be prepared by the Director. The manual shall contain details of, among others, the sequence of events before and after execution; procedures in setting up the intravenous line; the administration of the lethal drugs; the pronouncement of death; and the removal of the intravenous system. Said manual shall be confidential and its distribution shall be limited to authorized prison personnel." Thus, the Courts finds in the first paragraph of Section 19 of the implementing rules a veritable vacuum. The Secretary of Justice has practically abdicated the power to promulgate the manual on the execution procedure to the Director of the Bureau of Corrections, by not providing for a mode of review and approval thereof. Being a mere constituent unit of the Department of Justice, the Bureau of Corrections could not promulgate a manual that would not bear the imprimatur of the administrative superior, the Secretary of Justice as the rule-making authority under R.A. No. 8177. Such apparent abdication of departmental responsibility renders the said paragraph invalid. As to the second paragraph of section 19, the Court finds the requirement of confidentiality of the contents of the manual even with respect to the convict unduly suppressive.It sees no legal impediment for the convict, should he so desire, to obtain a copy of the manual. The contents of the manual are matters of public concern "which the public may want to know, either because these directly affect their lives, or simply because such matters naturally arouse the interest of an ordinary citizen."[62] Section 7 of Article III of the 1987 Constitution provides:

"SEC. 7. The right of the people to information on matters of public concern shall be recognized. Access to official records, and to documents and papers pertaining to official acts, transaction, or decisions, as well as to government research data used as a basis for policy development, shall be afforded the citizen, subject to such limitation as may be provided by law." The incorporation in the Constitution of a guarantee of access to information of public concern is a recognition of the essentiality of the free flow of ideas and information in a democracy. [63] In the same way that free discussion enables members of society to cope with the exigencies of their time,[64] access to information of general interest aids the people in democratic decision-making[65] by giving them a better perspective of the vital issues confronting the nation.[66] D. SECTION 17 OF THE RULES AND REGULATIONS TO IMPLEMENT R.A. NO. 8177 IS INVALID FOR BEING DISCRIMINATORY AND CONTRARY TO LAW. Even more seriously flawed than Section 19 is Section of the implementing rules which provides: "SEC. 17. SUSPENSION OF THE EXECUTION OF THE DEATH SENTENCE. Execution by lethal injection shall not be inflicted upon a woman within the three years next following the date of the sentence or while she is pregnant, nor upon any person over seventy (70) years of age. In this latter case, the death penalty shall be commuted to the penalty of reclusion perpetua with the accessory penalties provided in Article 40 of the Revised Penal Code." Petitioner contends that Section 17 is unconstitutional for being discriminatory as well as for being an invalid exercise of the power to legislate by respondent Secretary.Petitioner insists that Section 17 amends the instances when lethal injection may be suspended, without an express amendment of Article 83 of the Revised Penal Code, as amended by section 25 of R.A. No. 7659. Article 83 f the Revised Penal Code, as amended by section 25 of R.A. No. 7659 now reads as follows: "ART. 83, Suspension of the execution of the death sentence.- The death sentence shall not be inflicted upon a woman while she is pregnant or within one (1) year after delivery, nor upon any person over seventy years of age. In this last case, the death sentence shall be commuted to the penalty of reclusion perpetua with the accessory penalty provided in Article 40. x x x". On this point, the Courts finds petitioner's contention impressed with merit. While Article 83 of the Revised Penal Code, as amended by Section 25 of Republic Act No. 7659, suspends the implementation of the death penalty while a woman is pregnant or within one (1) year after delivery, Section 17 of the implementing rules omits the one (1) year period following delivery as an instance when the death sentence is suspended, and adds a ground for suspension of sentence no longer found under Article 83 of the Revised Penal Code as amended, which is the three-year reprieve after a woman is sentenced. This addition is, in petitioner's view, tantamount to a gender-based discrimination sans statutory basis, while the omission is an impermissible contravention of the applicable law. Being merely an implementing rule, Section 17 aforecited must not override, but instead remain consistent and in harmony with the law it seeks to apply and implement.Administrative rules and regulations are intended to carry out, neither to supplant nor to modify, the law."[67] An administrative agency cannot amend an act of Congress.[68] In case of discrepancy between a provision of statute and a rule or regulation issued to implement said statute, the statutory provision prevails. Since the cited clause in Section 17 which suspends the execution of a woman within the three (3) years next following the date of sentence finds no supports in Article 83 of the Revised Penal Code as amended, perforce Section 17 must be declared invalid. One member of the Court voted to declare Republic Act. No. 8177 as unconstitutional insofar as it delegates the power to make rules over the same subject matter to two persons (the Secretary of Justice and the Director of the Bureau of Corrections) and constitutes a violation of the international norm towards the abolition of the death penalty.One member of the Court, consistent with his view in People v. Echegaray, 267 SCRA 682, 734-758 (1997) that the death penalty law (Republic Act. No. 7659) is itself unconstitutional, believes that Republic Act No. 8177 which provides for the means of carrying out the death sentence, is likewise unconstitutional. Two other members of the court concurred in the aforesaid Separate Opinions in that the death penalty law (Republic Act No. 7659) together with the assailed statute (Republic Act No. 8177) are unconstitutional. In sum, four members of the Court voted to declare Republic Act. No. 8177 as unconstitutional. These Separate Opinions are hereto annexed, infra.

WHEREFORE, the petition is DENIED insofar as petitioner seeks to declare the assailed statute (Republic Act No. 8177) as unconstitutional; but GRANTED insofar as Sections 17 and 19 of the Rules and Regulations to Implement Republic Act No. 8177 are concerned, which are hereby declared INVALID because (a) Section 17 contravenes Article 83 of the Revised Penal Code, as amended by Section 25 of the Republic Act No. 7659; and (b) Section 19 fails to provide for review and approval of the Lethal Injection Manual by the Secretary of Justice, and unjustifiably makes the manual confidential, hence unavailable to interested parties including the accused/convict and counsel.Respondents are hereby enjoined from enforcing and implementing Republic Act No. 8177 until the aforesaid Sections 17 and 19 of the Rules and Regulations to Implement Republic Act No. 8177 are appropriately amended, revised and/or corrected in accordance with this Decision. NO COSTS. SO ORDERED.

G.R. No. 96409 February 14, 1992 CITIZEN J. ANTONIO M. CARPIO, petitioner, vs. THE EXECUTIVE SECRETARY, THE SECRETARY OF LOCAL GOVERNMENTS, THE SECRETARY OF NATIONAL DEFENSE and THE NATIONAL TREASURER, respondents. PARAS, J.: At the very outset, it should be well to set forth the constitutional provision that is at the core of the controversy now confronting us, thus: Article XVI, Section 6: The State shall establish and maintain one police force, which stall be national in scope and civilian in character, to be administered and controlled by a national police commission. The authority of local executives over the police units in their jurisdiction shall be provided by law.

1

With the aforequoted provision in mind, Congress passed Republic Act No. 6975 entitled "AN ACT ESTABLISHING THE PHILIPPINE NATIONAL POLICE UNDER A REORGANIZED DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT, AND FOR OTHER PURPOSES" as the consolidated version of House Bill No. 23614 and Senate Bill No. 463. Following the said Act's approval by President Corazon C. Aquino on December 13, 1990, it was published on December 17, 1990. 2 Presently, however, petitioner as citizen, taxpayer and member of the Philippine Bar sworn to defend the Constitution, filed the petition now at bar on December 20, 1990, seeking this Court's declaration of unconstitutionality of RA 6975 with prayer for temporary restraining order. But in an en banc resolution dated December 27, 1990, We simply required the public respondents to file their Comment, without however giving due course to the petition and the prayer therein. Hence, the Act took effect after fifteen days following its publication, or on January 1, 1991. 3 Before we settle down on the merits of the petition, it would likewise be well to discuss albeit briefly the history of our police force and the reasons for the ordination of Section 6, Article XVI in our present Constitution. During the Commonwealth period, we had the Philippine Constabulary as the nucleus of the Philippine Ground Force (PGF), now the Armed Forces of the Philippines (AFP). The PC was made part of the PGF but its administrative, supervisory and directional control was handled by the then Department of the Interior. After the war, it remained as the "National Police" under the Department of National Defense, as a major service component of the AFP. 4

Later, the Integration Act of 1975 5 created the Integrated National Police (INP) under the Office of the President, with the PC as the nucleus, and the local police forces as the civilian components. The PC-INP was headed by the PC Chief who, as concurrent Director-General of the INP, exercised command functions over the INP. 6 The National Police Commission (NAPOLCOM) 7 exercised administrative control and supervision while the local executives exercised operational supervision and direction over the INP units assigned within their respective localities. 8 The set-up whereby the INP was placed under the command of the military component, which is the PC, severely eroded the INP's civilian character and the multiplicity in the governance of the PC-INP resulted in inefficient police service. 9 Moreover, the integration of the national police forces with the PC also resulted in inequities since the military component had superior benefits and privileges. 10 The Constitutional Commission of 1986 was fully aware of the structural errors that beset the system. Thus, Com. Teodulo C. Natividad explained that: xxx

xxx

xxx

MR. NATIVIDAD. . . . The basic tenet of a modern police organization is to remove it from the military. 11 xxx xxx xxx Here in our draft Constitution, we have already made a constitutional postulate that the military cannot occupy any civil service position [in Section 6 of the Article on the Civil Service 12] Therefore, in keeping with this and because of the universal acceptance that a police force is a civilian function, a public service, and should not be performed by military force, one of the basic reforms we are presenting here is that it should be separated from the military force which is the PC. 13 xxx xxx xxx Furthermore: xxx xxx xxx . . . the civilian police cannot blossom into full profession because most of the key positions are being occupied by the military So, it is up to this Commission to remove the police from such a situation so that it can develop into a truly professional civilian police. . . . 14 Hence, the "one police force, national in scope, and civilian in character" provision that is now Article XVI, Section 6 of the 1987 Constitution. And so we now come to the merits of the petition at hand. In the main, petitioner herein respectfully advances the view that RA 6975 emasculated the National Police Commission by limiting its power "to administrative control" over the Philippine National Police (PNP), thus, "control" remained with the Department Secretary under whom both the National Police Commission and the PNP were placed. 15 We do not share this view.

To begin with, one need only refer to the fundamentally accepted principle in Constitutional Law that the President has control of all executive departments, bureaus, and offices to lay at rest petitioner's contention on the matter. This presidential power of control over the executive branch of government extends over all executive officers from Cabinet Secretary to the lowliest clerk 17 and has been held by us, in the landmark case of Mondano vs. Silvosa, 18to mean "the power of [the President] to alter or modify or nullify or set aside what a subordinate officer had done in the performance of his duties and to substitute the judgment of the former with that of the latter." It is said to be at the very "heart of the meaning of Chief Executive." 19 Equally well accepted, as a corollary rule to the control powers of the President, is the "Doctrine of Qualified Political Agency". As the President cannot be expected to exercise his control powers all at the same time and in person, 20he will have to delegate some of them to his Cabinet members. Under this doctrine, which recognizes the establishment of a single executive, 21 "all executive and administrative organizations are adjuncts of the Executive Department, the heads of the various executive departments are assistants and agents of the Chief Executive, and, except in cases where the Chief Executive is required by the Constitution or law to act in person on the exigencies of the situation demand that he act personally, the multifarious executive and administrative functions of the Chief Executive are performed by and through the executive departments, and the acts of the Secretaries of such departments, performed and promulgated in the regular course of business, unless disapproved or reprobated by the Chief Executive presumptively the acts of the Chief Executive." 22 (emphasis ours) Thus, and in short, "the President's power of control is directly exercised by him over the members of the Cabinet who, in turn, and by his authority, control the bureaus and other offices under their respective jurisdictions in the executive department." 23 Additionally, the circumstance that the NAPOLCOM and the PNP are placed under the reorganized Department of Interior and Local Government is merely an administrative realignment that would bolster a system of coordination and cooperation among the citizenry, local executives and the integrated law enforcement agencies and public safety agencies created under the assailed Act, 24 the funding of the PNP being in large part subsidized by the national government. Such organizational set-up does not detract from the mandate of the Constitution that the national police force shall be administered and controlled by a national police commission as at any rate, and in fact, the Act in question adequately provides for administration and control at the commission level, as shown in the following provisions, to wit: Sec. 14. Powers and Functions of the Commission. — The Commission shall exercise the following powers and functions: xxx xxx xxx (i) Approve or modify plans and programs on education and training, logistical requirements, communications, records, information systems, crime laboratory, crime prevention and crime reporting; (j) Affirm, reverse or modify, through the National Appellate Board, personnel disciplinary actions involving demotion or dismissal from the service imposed upon members of the Philippine National Police by the Chief of the PNP; (k) Exercise appellate jurisdiction through .the regional. appellate boards over administrative cases against policemen and over decisions on claims for police benefits; xxx xxx xxx

Sec. 26. The Command and direction of the PNP shall be vested in the Chief of the PNP . . . Such command and direction of the Chief of the PNP may be delegated to subordinate officials with respect to the units under their respective commands, in accordance with the rules and regulations prescribed by the Commission. . . . xxx xxx xxx Sec. 35. . . . To enhance police operational efficiency and effectiveness, the Chief of the PNP may constitute such other support units as may be necessary subject to the approval of the Commission. . . . xxx xxx xxx Sec. 37. . . . There shall be established a performance evaluation system which shall be administered in accordance with the rules, regulations and standards; and a code of conduct promulgated by the Commission for members of the PNP. . . . xxx

xxx

xxx

Petitioner further asserts that in manifest derogation of the power of control of the NAPOLCOM over the PNP, RA 6975 vested the power to choose the PNP Provincial Director and the Chiefs of Police in the Governors and Mayors, respectively; the power of "operational supervision and control" over police units in city and municipal mayors; in the Civil Service Commission, participation in appointments to the positions of Senior Superintendent to Deputy Director-General as well as the administration of qualifying entrance examinations; disciplinary powers over PNP members in the "People's Law Enforcement Boards" and in city and municipal mayors. 25 Once more, we find no real controversy upon the foregoing assertions. It is true that when the Constitutional Commissioners of 1986 provided that the authority of local executives over the police units in their jurisdiction shall be provided by law, they intended that the day-to-day functions of police work like crime, investigation, crime prevention activities, traffic control, etc., would be under the operational control of the local executives as it would not be advisable to give full control of the police to the local executives. 26 They reasoned that in the past, this gave rise to warlordism, bossism, and sanctuaries for vices and abuses.

27

It would appear then that by vesting in the local executives the power to choose the officers in question, the Act went beyond the bounds of the Constitution's intent. Not so. We find light in the principle of constitutional construction that every presumption should be indulged in favor of constitutionality and the court in considering the validity of the statute in question should give it such reasonable construction as can be reached to bring it within the fundamental law. 28 Under the questioned provisions, which read as follows: D. PARTICIPATION OF LOCAL EXECUTIVES IN THE ADMINISTRATION OF THE PNP. Sec. 51. Powers of Local Government Officials over the PNP Units or Forces. Governors and mayors shall be deputized as representatives of the Commission in their respective territorial jurisdictions. As such, the local executives shall discharge the following functions:

a.) Provincial Governor — (1) . . . The provincial governor shall choose the provincial director from a list of three (3) eligibles recommended by the PNP Regional Director. 4) . . . City and municipal mayors shall have the following authority over the PNP units in their respective jurisdictions: i.) Authority to choose the chief of police from a list of five (5) eligibles recommended by the Provincial Police Director. . . . (Emphasis ours) full control remains with the National Police Commission. We agree, and so hold, with the view of the Solicitor General that "there is no usurpation of the power of control of the NAPOLCOM under Section 51 because under this very same provision, it is clear that the local executives are only acting as representatives of the NAPOLCOM. . . . As such deputies, they are answerable to the NAPOLCOM for their actions in the exercise of their functions under that section. Thus, unless countermanded by the NAPOLCOM, their acts are valid and binding as acts of the NAPOLCOM." 29 It is significant to note that the local officials, as NAPOLCOM representatives, will choose the officers concerned from a list of eligibles (those who meet the general qualifications for appointment to the PNP) 30 to be recommended by PNP officials. The same holding is true with respect to the contention on the operational supervision and control exercised by the local officials. Those officials would simply be acting as representatives of the Commission. As regards the assertion involving the Civil Service Commission, suffice it to say that the questioned provisions, which read: Sec. 31. Appointment of PNP Officers and Members. — The Appointment of the officers and members of the PNP shall be effected in the following manner: a.) Police Officer I to Senior Police Officer IV. — Appointed by the PNP regional director for regional personnel or by the Chief of the PNP for national headquarters personnel and attested by the Civil Service Commission; b.) Inspector to Superintendent. — Appointed by the Chief of the PNP, as recommended by their immediate superiors, and attested by the Civil Service Commission; c.) Senior Superintendent to Deputy Director-General. — Appointed by the President upon recommendation of the Chief of the PNP, with proper endorsement by the Chairman of the Civil Service Commission . . . Sec. 32. Examinations for Policemen. — The Civil Service Commission shall administer the qualifying entrance examinations for policemen on the basis of the standards set by the NAPOLCOM. precisely underscore the civilian character of the national police force, and will undoubtedly professionalize the same. The grant of disciplinary powers over PNP members to the "People's Law Enforcement Boards" (or the PLEB) and city and municipal mayors is also not in derogation of the commission's power of control over the PNP. Pursuant to the Act, the Commission exercises appellate jurisdiction, thru the regional appellate boards, over decisions of both the PLEB and the said mayors. This is so under Section 20(c). Furthermore, it is the

Commission which shall issue the implementing guidelines and procedures to be adopted by the PLEB for in the conduct of its hearings, and it may assign NAPOLCOM hearing officers to act as legal consultants of the PLEBs (Section 43-d4, d5). As a disciplinary board primarily created to hear and decide citizen's complaints against erring officers and members of the PNP, the establishment of PLEBs in every city, and municipality would all the more help professionalize the police force. Petitioner would likewise have this Court imagine that Section 12 of the questioned Act, the pertinent portion of which reads: Sec. 12. Relationship of the Department with the Department of National Defense. — During a period of twenty- four (24) months from the effectivity of this Act, the Armed Forces of the Philippines (AFP) shall continue its present role of preserving the internal and external security of the State: Provided, that said period may be extended by the President, if he finds it justifiable, for another period not exceeding twenty-four (24) months, after which, the Department shall automatically take over from the AFP the primary role of preserving internal security, leaving to the AFP its primary role of preserving external security. xxx

xxx

xxx

constitutes an "encroachment upon, interference with, and an abdication by the President of, executive control and commander-in-chief powers." That We are not disposed to do for such is not the case at all here. A rejection thus of petitioner's submission anent Section 12 of the Act should be in order in the light of the following exchanges during the CONCOM deliberations of Wednesday, October 1, 1986: xxx xxx xxx MR. RODRIGO. Just a few questions. The President of the Philippines is the Commander-inChief of all the armed forces. MR. NATIVIDAD. Yes, Madam President. MR. RODRIGO. Since the national police is not integrated with the armed forces, I do not suppose they come under the Commander-in-Chief powers of the President of the Philippines. MR. NATIVIDAD. They do, Madam President. By law they are under the supervision and control of the President of the Philippines. MR. RODRIGO. Yes, but the President is not the Commander-in-Chief of the national police. MR. NATIVIDAD. He is the President. MR. RODRIGO. Yes, the Executive. But they do not come under that specific provision that the President is Commander-in-Chief of all the armed forces. MR. NATIVIDAD. No, not under the Commander-in-Chief provision. MR. RODRIGO. There are two other powers of the President. The President has control over departments, bureaus and offices, and supervision over local governments. Under which does the police fall, under control or under supervision? MR. NATIVIDAD. Both, Madam President.

MR. RODRIGO. Control and Supervision. MR. NATIVIDAD. Yes, in fact, the National Police Commission is under the Office of the President. (CONCOM RECORDS, Vol. 5, p. 296) It thus becomes all too apparent then that the provision herein assailed precisely gives muscle to and enforces the proposition that the national police force does not fall under the Commander-in-Chief powers of the President. This is necessarily so since the police force, not being integrated with the military, is not a part of the Armed Forces of the Philippines. As a civilian agency of the government, it properly comes within, and is subject to, the exercise by the President of the power of executive control. Consequently, Section 12 does not constitute abdication of commander-in-chief powers. It simply provides for the transition period or process during which the national police would gradually assume the civilian function of safeguarding the internal security of the State. Under this instance, the President, to repeat, abdicates nothing of his war powers. It would bear to here state, in reiteration of the preponderant view, that the President, as Commander-in-Chief, is not a member of the Armed Forces. He remains a civilian whose duties under the Commander-in-Chief provision "represent only a part of the organic duties imposed upon him. All his other functions are clearly civil in nature." 31 His position as a civilian Commander-in-Chief is consistent with, and a testament to, the constitutional principle that "civilian authority is, at all times, supreme over the military." (Article II, Section 3, 1987 Constitution) Finally, petitioner submits that the creation of a "Special Oversight Committee" under Section 84 of the Act, especially the inclusion therein of some legislators as members (namely: the respective Chairmen of the Committee on Local Government and the Committee on National Defense and Security in the Senate, and the respective Chairmen of the Committee on Public Order and Security and the Committee on National Defense in the House of Representatives) is an "unconstitutional encroachment upon and a diminution of, the President's power of control over all executive departments, bureaus and offices." But there is not the least interference with the President's power of control under Section 84. The Special Oversight Committee is simply an ad hoc or transitory body, established and tasked solely with planning and overseeing the immediate "transfer, merger and/or absorption" into the Department of the Interior and Local Governments of the "involved agencies." This it will undertake in accordance with the phases of implementation already laid down in Section 85 of the Act and once this is carried out, its functions as well as the committee itself would cease altogether. 32 As an ad hoc body, its creation and the functions it exercises, decidedly do not constitute an encroachment and in diminution of the power of control which properly belongs to the President. What is more, no executive department, bureau or office is placed under the control or authority, of the committee. 33 As a last word, it would not be amiss to point out here that under the Constitution, there are the socalled independent Constitutional Commissions, namely: The Civil Service Commission, Commission on Audit, and the Commission on Elections. (Article IX-A, Section 1) As these Commissions perform vital governmental functions, they have to be protected from external influences and political pressures. Hence, they were made constitutional bodies, independent of and not under any department of the government. 34 Certainly, they are not under the control of the President. The Constitution also created an independent office called the "Commission on Human Rights." (Article XIII, Section 17[1]).However, this Commission is not on the same level as the Constitutional Commissions under Article IX, although it is independent like the latter Commissions. 35 It still had to be constituted thru Executive Order No. 163 (dated May 5, 1987). In contrast, Article XVI, Section 6 thereof, merely mandates the statutory creation of a national police commission that will administer and control the national police force to be established thereunder.

This commission is, for obvious reasons, not in the same category as the independent Constitutional Commissions of Article IX and the other constitutionally created independent Office, namely, the Commission on Human Rights. By way of resume, the three Constitutional Commissions (Civil Service, Audit, Elections) and the additional commission created by the Constitution (Human Rights) are all independent of the Executive; but the National Police Commission is not. 36 In fact, it was stressed during the CONCOM deliberations that this commission would be under the President, and hence may be controlled by the President, thru his or her alter ego, the Secretary of the Interior and Local Government. WHEREFORE, having in view all of the foregoing holdings, the instant petition is hereby DISMISSED for lack of merit. SO ORDERED.

[G.R. No. 149724. August 19, 2003]

DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, represented herein by its Secretary, HEHERSON T. ALVAREZ,petitioner, vs. DENR REGION 12 EMPLOYEES, represented by BAGUIDALI KARIM, Acting President of COURAGE (DENR Region 12 Chapter), respondents. DECISION YNARES-SANTIAGO, J.: This is a petition for review assailing the Resolutions dated May 31, 2000[1] of the Court of Appeals which dismissed the petition for certiorari in CA-G.R. SP No. 58896, and its Resolution dated August 20, 2001[2], which denied the motion for reconsideration. The facts are as follows: On November 15, 1999, Regional Executive Director of the Department of Environment and Natural Resources for Region XII, Israel C. Gaddi, issued a Memorandum[3] directing the immediate transfer of the DENR XII Regional Offices from Cotabato City to Koronadal (formerly Marbel), South Cotabato. The Memorandum was issued pursuant to DENR Administrative Order No. 99-14, issued by then DENR Secretary Antonio H. Cerilles, which reads in part: Subject: Providing for the Redefinition of Functions and Realignment of Administrative Units in the Regional and Field Offices: Pursuant to Executive Order No. 192, dated June 10, 1987 and as an interim administrative arrangement to improve the efficiency and effectiveness of the Department of Environment and Natural Resources (DENR) in delivering its services pending approval of the government-wide reorganization by Congress, the following redefinition of functions and realignment of administrative units in the regional and field offices are hereby promulgated: Section 1. Realignment of Administrative Units: The DENR hereby adopts a policy to establish at least one Community Environment and Natural Resources Office (CENRO) or Administrative Unit per Congressional District except in the Autonomous Region of Muslim Mindanao (ARMM) and the National Capital Region (NCR). The Regional Executive Directors (REDs) are hereby authorized to realign/relocate existing CENROs and implement this policy in accordance with the attached distribution list per region which forms part of this Order. Likewise, the following realignment and administrative arrangements are hereby adopted:

xxxxxxxxx 1.6. The supervision of the Provinces of South Cotabato and Sarangani shall be transferred from Region XI to XII. [4] Respondents, employees of the DENR Region XII who are members of the employees association, COURAGE, represented by their Acting President, Baguindanai A. Karim, filed with the Regional Trial Court of Cotabato, a petition for nullity of orders with prayer for preliminary injunction. On December 8, 1999, the trial court issued a temporary restraining order enjoining petitioner from implementing the assailed Memorandum. The dispositive portion of the Order reads: WHEREFORE, defendants DENR Secretary Antonio H. Cerilles and Regional Executive Director Israel C. Gaddi are hereby ordered to cease and desist from doing the act complained of, namely, to stop the transfer of DENR [Region] 12 offices from Cotabato City to Korandal (Marbel), South Cotabato. xxx xxx xxx. SO ORDERED.[5] Petitioner filed a Motion for Reconsideration with Motion to Dismiss, raising the following grounds: I. The power to transfer the Regional Office of the Department of Environment and Natural Resources (DENR) is executive in nature. II. The decision to transfer the Regional Office is based on Executive Order No. 429, which reorganized Region XII. III. The validity of EO 429 has been affirmed by the Honorable Supreme Court in the Case of Chiongbian vs. Orbos (1995) 245 SCRA 255. IV. Since the power to reorganize the Administrative Regions is Executive in Nature citing Chiongbian, the Honorable Court has no jurisdiction to entertain this petition.[6] On January 14, 2000, the trial court rendered judgment, the dispositive portion of which reads: CONSEQUENTLY, order is hereby issued ordering the respondents herein to cease and desist from enforcing their Memorandum Order dated November 15, 1999 relative to the transfer of the DENR Regional Offices from Region 12 to Region 11 at Koronadal, South Cotabato for being bereft of legal basis and issued with grave abuse of discretion amounting to lack or excess of jurisdiction on their part, and they are further ordered to return back the seat of the DENR Regional Offices 12 to Cotabato City. SO ORDERED.[7] Petitioners motion for reconsideration was denied in an Order dated April 10, 2000. A petition for certiorari under Rule 65 was filed before the Court of Appeals, docketed as CA-G.R. SP No. 58896. The petition was dismissed outright for: (1) failure to submit a written explanation why personal service was not done on the adverse party; (2) failure to attach affidavit of service; (3) failure to indicate the material dates when copies of the orders of the lower court were received; (4) failure to attach certified true copy of the order

denying petitioners motion for reconsideration; (5) for improper verification, the same being based on petitioners knowledge and belief, and (6) wrong remedy of certiorari under Rule 65 to substitute a lost appeal. [8] The motion for reconsideration was denied in a resolution dated August 20, 2001. [9] Hence, this petition based on the following assignment of errors: I RULES OF PROCEDURE CAN NOT BE USED TO DEFEAT THE ENDS OF SUBSTANTIAL JUSTICE II THE DECISION OF THE LOWER COURT DATED 14 JANUARY 2000 WHICH WAS AFFIRMED IN THE QUESTIONED RESOLUTIONS OF THE COURT OF APPEALS DATED 31 MAY 2000 AND 20 AUGUST 2001 IS PATENTLY ILLEGAL AND SHOULD BE NULLIFIED, CONSIDERING THAT: A. RESPONDENTS HAVE NO CAUSE OF ACTION AGAINST PETITIONER AS THEY HAVE NO RIGHT TO CAUSE THE DENR REGION 12 OFFICE TO REMAIN IN COTABATO CITY. B. THE STATE DID NOT GIVE ITS CONSENT TO BE SUED. C. THE DECISION OF THE LOWER COURT DATED 14 JANUARY 2000 IS CONTRARY TO THE RULE OF PRESUMPTION OF REGULARITY IN THE PERFORMANCE OF OFFICIAL FUNCTIONS. D. IN ANY EVENT, THE DECISION OF THE LOWER COURT DATED 14 JANUARY 2000 IS CONTRARY TO THE LETTER AND INTENT OF EXECUTIVE ORDER NO. 429 AND REPUBLIC ACT NO. 6734. E. THE DETERMINATION OF THE PROPRIETY AND PRACTICALITY OF THE TRANSFER OF REGIONAL OFFICES IS INHERENTLY EXECUTIVE, AND THEREFORE, NONJUSTICIABLE.[10] In essence, petitioner argues that the trial court erred in enjoining it from causing the transfer of the DENR XII Regional Offices, considering that it was done pursuant to DENR Administrative Order 99-14. The issues to be resolved in this petition are: (1) Whether DAO-99-14 and the Memorandum implementing the same were valid; and (2) Whether the DENR Secretary has the authority to reorganize the DENR. Prefatorily, petitioner prays for a liberal application of procedural rules considering the greater interest of justice. This Court is fully aware that procedural rules are not to be simply disregarded for these prescribed procedures ensure an orderly and speedy administration of justice. However, it is equally true that litigation is not merely a game of technicalities. Time and again, courts have been guided by the principle that the rules of procedure are not to be applied in a very rigid and technical manner, as rules of procedure are used only to help secure and not to override substantial justice.[11]Thus, if the application of the Rules would tend to frustrate rather than promote justice, it is always within the power of this Court to suspend the rules, or except a particular case from its operation.[12] Despite the presence of procedural flaws, we find it necessary to address the issues because of the demands of public interest, including the need for stability in the public service and the serious implications this case may cause on the effective administration of the executive department. Although no appeal was made within the reglementary period to appeal, nevertheless, the departure from the general rule that the extraordinary writ of certiorari cannot be a substitute for the lost remedy of appeal is justified because the execution of the assailed decision would amount to an oppressive exercise of judicial authority.[13]

Petitioner maintains that the assailed DAO-99-14 and the implementing memorandum were valid and that the trial court should have taken judicial notice of Republic Act No. 6734, otherwise known as An Organic Act for the Autonomous Region in Muslim Mindanao, and its implementing Executive Order 429, [14] as the legal bases for the issuance of the assailed DAO-99-14. Moreover, the validity of R.A. No. 6734 and E.O. 429 were upheld in the case of Chiongbian v. Orbos.[15]Thus, the respondents cannot, by means of an injunction, force the DENR XII Regional Offices to remain in Cotabato City, as the exercise of the authority to transfer the same is executive in nature. It is apropos to reiterate the elementary doctrine of qualified political agency, thus: Under this doctrine, which recognizes the establishment of a single executive, all executive and administrative organizations are adjuncts of the Executive Department, the heads of the various executive departments are assistants and agents of the Chief Executive, and, except in cases where the Chief Executive is required by the Constitution or law to act in person or the exigencies of the situation demand that he act personally, the multifarious executive and administrative functions of the Chief Executive are performed by and through the executive departments, and the acts of the Secretaries of such departments, performed and promulgated in the regular course of business, are, unless disapproved or reprobated by the Chief Executive, presumptively the acts of the Chief Executive.[16] This doctrine is corollary to the control power of the President as provided for under Article VII, Section 17 of the 1987 Constitution, which reads: Sec. 17. The President shall have control of all the executive departments, bureaus, and offices. He shall ensure that the laws be faithfully executed. However, as head of the Executive Department, the President cannot be expected to exercise his control (and supervisory) powers personally all the time. He may delegate some of his powers to the Cabinet members except when he is required by the Constitution to act in person or the exigencies of the situation demand that he acts personally.[17] In Buklod ng Kawaning EIIB v. Zamora,[18] this Court upheld the continuing authority of the President to carry out the reorganization in any branch or agency of the executive department. Such authority includes the creation, alteration or abolition of public offices.[19] The Chief Executives authority to reorganize the National Government finds basis in Book III, Section 20 of E.O. No. 292, otherwise known as the Administrative Code of 1987, viz: Section 20. Residual Powers. Unless Congress provides otherwise, the President shall exercise such other powers and functions vested in the President which are provided for under the laws and which are not specifically enumerated above or which are not delegated by the President in accordance with law. Further, in Larin v. Executive Secretary,[20] this Court had occasion to rule: This provision speaks of such other powers vested in the President under the law. What law then gives him the power to reorganize? It is Presidential Decree No. 1772 which amended Presidential Decree No. 1416. These decrees expressly grant the President of the Philippines the continuing authority to reorganize the national government, which includes the power to group, consolidate bureaus and agencies, to abolish offices, to transfer functions, to create and classify functions, services and activities and to standardize salaries and materials. The validity of these two decrees is unquestionable. The 1987 Constitution clearly provides that all laws, decrees, executive orders, proclamations, letters of instructions and other executive issuances not inconsistent with this Constitution shall remain operative until amended, repealed or revoked. So far, there is yet no law amending or repealing said decrees. Applying the doctrine of qualified political agency, the power of the President to reorganize the National Government may validly be delegated to his cabinet members exercising control over a particular executive department. Thus, in DOTC Secretary v. Mabalot,[21] we held that the President through his duly constituted political agent and alter ego, the DOTC Secretary may legally and validly decree the reorganization of the Department, particularly the establishment of DOTC-CAR as the LTFRB Regional Office at the Cordillera

Administrative Region, with the concomitant transfer and performance of public functions and responsibilities appurtenant to a regional office of the LTFRB. Similarly, in the case at bar, the DENR Secretary can validly reorganize the DENR by ordering the transfer of the DENR XII Regional Offices from Cotabato City to Koronadal, South Cotabato. The exercise of this authority by the DENR Secretary, as an alter ego, is presumed to be the acts of the President for the latter had not expressly repudiated the same. The trial court should have taken judicial notice of R.A. No. 6734, as implemented by E.O. No. 429, as legal basis of the Presidents power to reorganize the executive department, specifically those administrative regions which did not vote for their inclusion in the ARMM. It is axiomatic that a court has the mandate to apply relevant statutes and jurisprudence in determining whether the allegations in a complaint establish a cause of action. While it focuses on the complaint, a court clearly cannot disregard decisions material to the proper appreciation of the questions before it.[22] In resolving the motion to dismiss, the trial court should have taken cognizance of the official acts of the legislative, executive, and judicial departments because they are proper subjects of mandatory judicial notice as provided by Section 1 of Rule 129 of the Rules of Court, to wit: A court shall take judicial notice, without the introduction of evidence, of the existence and territorial extent of states, their political history, forms of government and symbols of nationality, the law of nations, the admiralty and maritime courts of the world and their seals, the political constitution and history of the Philippines, the official acts of the legislative, executive and judicial departments of the Philippines, the laws of nature, the measure of time, and the geographical divisions. (Emphasis supplied) Article XIX, Section 13 of R.A. No. 6734 provides: SECTION 13. The creation of the Autonomous Region in Muslim Mindanao shall take effect when approved by a majority of the votes cast by the constituent units provided in paragraph (2) of Sec. 1 of Article II of this Act in a plebiscite which shall be held not earlier than ninety (90) days or later than one hundred twenty (120) days after the approval of this Act: Provided, That only the provinces and cities voting favorably in such plebiscite shall be included in the Autonomous Region in Muslim Mindanao. The provinces and cities which in the plebiscite do not vote for inclusion in the Autonomous Region shall remain in the existing administrative regions: Provided, however, That the President may, by administrative determination, merge the existing regions. Pursuant to the authority granted by the aforequoted provision, then President Corazon C. Aquino issued on October 12, 1990 E.O. 429, Providing for the Reorganization of the Administrative Regions in Mindanao. Section 4 thereof provides: SECTION 4. REGION XII, to be known as CENTRAL MINDANAO, shall include the following provinces and cities: Provinces Sultan Kudarat Cotabato South Cotabato Cities Cotabato General Santos The Municipality of Koronadal (Marinduque) in South Cotabato shall serve as the regional center. In Chiongbian v. Orbos, this Court stressed the rule that the power of the President to reorganize the administrative regions carries with it the power to determine the regional centers. In identifying the regional centers, the President purposely intended the effective delivery of the field services of government agencies.[23] The same intention can be gleaned from the preamble of the assailed DAO-99-14 which the DENR sought to achieve, that is, to improve the efficiency and effectiveness of the DENR in delivering its services.

It may be true that the transfer of the offices may not be timely considering that: (1) there are no buildings yet to house the regional offices in Koronadal, (2) the transfer falls on the month of Ramadan, (3) the children of the affected employees are already enrolled in schools in Cotabato City, (4) the Regional Development Council was not consulted, and (5) the Sangguniang Panglungsond, through a resolution, requested the DENR Secretary to reconsider the orders.However, these concern issues addressed to the wisdom of the transfer rather than to its legality. It is basic in our form of government that the judiciary cannot inquire into the wisdom or expediency of the acts of the executive or the legislative department, [24] for each department is supreme and independent of the others, and each is devoid of authority not only to encroach upon the powers or field of action assigned to any of the other department, but also to inquire into or pass upon the advisability or wisdom of the acts performed, measures taken or decisions made by the other departments.[25] The Supreme Court should not be thought of as having been tasked with the awesome responsibility of overseeing the entire bureaucracy. Unless there is a clear showing of constitutional infirmity or grave abuse of discretion amounting to lack or excess of jurisdiction, the Courts exercise of the judicial power, pervasive and limitless it may seem to be, still must succumb to the paramount doctrine of separation of powers. [26] After a careful review of the records of the case, we find that this jurisprudential element of abuse of discretion has not been shown to exist. WHEREFORE, in view of the foregoing, the petition for review is GRANTED. The resolutions of the Court of Appeals in CA-G.R. SP No. 58896 dated May 31, 2000 and August 20, 2001, as well as the decision dated January 14, 2000 of the Regional Trial Court of Cotabato City, Branch 15, in Civil Case No 389, are REVERSED and SET ASIDE. The permanent injunction, which enjoined the petitioner from enforcing the Memorandum Order of the DENR XII Regional Executive Director, is LIFTED. SO ORDERED.

G.R. No. 96681 December 2, 1991 HON. ISIDRO CARIÑO, in his capacity as Secretary of the Department of Education, Culture & Sports, DR. ERLINDA LOLARGA, in her capacity as Superintendent of City Schools of Manila, petitioners, vs. THE COMMISSION ON HUMAN RIGHTS, GRACIANO BUDOY, JULIETA BABARAN, ELSA IBABAO, HELEN LUPO, AMPARO GONZALES, LUZ DEL CASTILLO, ELSA REYES and APOLINARIO ESBER, respondents.

NARVASA, J.: The issue raised in the special civil action of certiorari and prohibition at bar, instituted by the Solicitor General, may be formulated as follows: where the relief sought from the Commission on Human Rights by a party in a case consists of the review and reversal or modification of a decision or order issued by a court of justice or government agency or official exercising quasi-judicial functions, may the Commission take cognizance of the case and grant that relief? Stated otherwise, where a particular subject-matter is placed by law within the jurisdiction of a court or other government agency or official for purposes of trial and adjudgment, may the Commission on Human Rights take cognizance of the same subject-matter for the same purposes of hearing and adjudication? The facts narrated in the petition are not denied by the respondents and are hence taken as substantially correct for purposes of ruling on the legal questions posed in the present action. These facts, 1 together with others involved in related cases recently resolved by this Court 2 or otherwise undisputed on the record, are hereunder set forth. 1. On September 17, 1990, a Monday and a class day, some 800 public school teachers, among them members of the Manila Public School Teachers Association (MPSTA) and Alliance of Concerned Teachers (ACT) undertook what they described as "mass concerted actions" to "dramatize and highlight" their plight resulting from the alleged failure of the public authorities to act upon grievances that had time and again been brought to the latter's attention. According to them they had decided to undertake said "mass concerted

actions" after the protest rally staged at the DECS premises on September 14, 1990 without disrupting classes as a last call for the government to negotiate the granting of demands had elicited no response from the Secretary of Education. The "mass actions" consisted in staying away from their classes, converging at the Liwasang Bonifacio, gathering in peaceable assemblies, etc. Through their representatives, the teachers participating in the mass actions were served with an order of the Secretary of Education to return to work in 24 hours or face dismissal, and a memorandum directing the DECS officials concerned to initiate dismissal proceedings against those who did not comply and to hire their replacements. Those directives notwithstanding, the mass actions continued into the week, with more teachers joining in the days that followed. 3 Among those who took part in the "concerted mass actions" were the eight (8) private respondents herein, teachers at the Ramon Magsaysay High School, Manila, who had agreed to support the non-political demands of the MPSTA. 4

2. For failure to heed the return-to-work order, the CHR complainants (private respondents) were administratively charged on the basis of the principal's report and given five (5) days to answer the charges. They were also preventively suspended for ninety (90) days "pursuant to Section 41 of P.D. 807" and temporarily replaced (unmarked CHR Exhibits, Annexes F, G, H). An investigation committee was consequently formed to hear the charges in accordance with P.D. 807. 5

3. In the administrative case docketed as Case No. DECS 90-082 in which CHR complainants Graciano Budoy, Jr., Julieta Babaran, Luz del Castillo, Apolinario Esber were, among others, named respondents, 6

the latter filed separate answers, opted for a formal investigation, and also moved "for suspension of the administrative proceedings pending resolution by . . (the Supreme) Court of their application for issuance of an injunctive writ/temporary restraining order." But when their motion for suspension was denied by Order dated November 8, 1990 of the Investigating Committee, which later also denied their motion for reconsideration orally made at the hearing of November 14, 1990, "the respondents led by their counsel staged a walkout signifying their intent to boycott the entire proceedings." 7 The case eventually resulted in a Decision of Secretary Cariño dated December 17, 1990, rendered after evaluation of the evidence as well as the answers, affidavits and documents submitted by the respondents, decreeing dismissal from the service of Apolinario Esber and the suspension for nine (9) months of Babaran, Budoy and del Castillo. 8 4. In the meantime, the "MPSTA filed a petition for certiorari before the Regional Trial Court of Manila against petitioner (Cariño), which was dismissed (unmarked CHR Exhibit, Annex I). Later, the MPSTA went to the Supreme Court (on certiorari, in an attempt to nullify said dismissal, grounded on the) alleged violation of the striking teachers" right to due process and peaceable assembly docketed as G.R. No. 95445, supra. The ACT also filed a similar petition before the Supreme Court . . . docketed as G.R. No. 95590." 9

Both petitions in this Court were filed in behalf of the teacher associations, a few named individuals, and "other teacher-members so numerous similarly situated" or "other similarly situated public school teachers too numerous to be impleaded." 5. In the meantime, too, the respondent teachers submitted sworn statements dated September 27, 1990 to the Commission on Human Rights to complain that while they were participating in peaceful mass actions, they suddenly learned of their replacements as teachers, allegedly without notice and consequently for reasons completely unknown to them. 10 6. Their complaints — and those of other teachers also "ordered suspended by the . . . (DECS)," all numbering forty-two (42) — were docketed as "Striking Teachers CHR Case No. 90775." In connection therewith the Commission scheduled a "dialogue" on October 11, 1990, and sent a subpoena to Secretary Cariño requiring his attendance therein. 11 On the day of the "dialogue," although it said that it was "not certain whether he (Sec. Cariño) received the subpoena which was served at his office, . . . (the) Commission, with the Chairman presiding, and Commissioners Hesiquio R. Mallilin and Narciso C. Monteiro, proceeded to hear the case;" it heard the complainants' counsel (a) explain that his clients had been "denied due process and suspended without formal notice, and unjustly, since they did not join the mass leave," and (b) expatiate on the grievances which were "the cause of the mass leave of MPSTA teachers, (and) with which causes they (CHR complainants) sympathize." 12 The Commission thereafter issued an Order 13reciting these facts and making the following disposition: To be properly apprised of the real facts of the case and be accordingly guided in its investigation and resolution of the matter, considering that these forty two teachers are now suspended and deprived of their wages, which they need very badly, Secretary Isidro Cariño, of the Department of Education,

Culture and Sports, Dr. Erlinda Lolarga, school superintendent of Manila and the Principal of Ramon Magsaysay High School, Manila, are hereby enjoined to appear and enlighten the Commission en banc on October 19, 1990 at 11:00 A.M. and to bring with them any and all documents relevant to the allegations aforestated herein to assist the Commission in this matter. Otherwise, the Commission will resolve the complaint on the basis of complainants' evidence. xxx

xxx

xxx

7. Through the Office of the Solicitor General, Secretary Cariño sought and was granted leave to file a motion to dismiss the case. His motion to dismiss was submitted on November 14, 1990 alleging as grounds therefor, "that the complaint states no cause of action and that the CHR has no jurisdiction over the case." 14

8. Pending determination by the Commission of the motion to dismiss, judgments affecting the "striking teachers" were promulgated in two (2) cases, as aforestated, viz.:

a) The Decision dated December l7, 1990 of Education Secretary Cariño in Case No. DECS 90-082, decreeing dismissal from the service of Apolinario Esber and the suspension for nine (9) months of Babaran, Budoy and del Castillo; 15 and b) The joint Resolution of this Court dated August 6, 1991 in G.R. Nos. 95445 and 95590 dismissing the petitions "without prejudice to any appeals, if still timely, that the individual petitioners may take to the Civil Service Commission on the matters complained of," 16 and inter alia "ruling that it was prima facie lawful for petitioner Cariño to issue return-to-work orders, file administrative charges against recalcitrants, preventively suspend them, and issue decision on those charges." 17 9. In an Order dated December 28, 1990, respondent Commission denied Sec. Cariño's motion to dismiss and required him and Superintendent Lolarga "to submit their counter-affidavits within ten (10) days . . . (after which) the Commission shall proceed to hear and resolve the case on the merits with or without respondents counter affidavit." 18 It held that the "striking teachers" "were denied due process of law; . . . they should not have been replaced without a chance to reply to the administrative charges;" there had been a violation of their civil and political rights which the Commission was empowered to investigate; and while expressing its "utmost respect to the Supreme Court . . . the facts before . . . (it) are different from those in the case decided by the Supreme Court" (the reference being unmistakably to this Court's joint Resolution of August 6, 1991 in G.R. Nos. 95445 and 95590, supra). It is to invalidate and set aside this Order of December 28, 1990 that the Solicitor General, in behalf of petitioner Cariño, has commenced the present action of certiorari and prohibition. The Commission on Human Rights has made clear its position that it does not feel bound by this Court's joint Resolution in G.R. Nos. 95445 and 95590, supra. It has also made plain its intention "to hear and resolve the case (i.e., Striking Teachers HRC Case No. 90-775) on the merits." It intends, in other words, to try and decide or hear and determine, i.e., exercise jurisdiction over the following general issues: 1) whether or not the striking teachers were denied due process, and just cause exists for the imposition of administrative disciplinary sanctions on them by their superiors; and 2) whether or not the grievances which were "the cause of the mass leave of MPSTA teachers, (and) with which causes they (CHR complainants) sympathize," justify their mass action or strike. The Commission evidently intends to itself adjudicate, that is to say, determine with character of finality and definiteness, the same issues which have been passed upon and decided by the Secretary of Education, Culture & Sports, subject to appeal to the Civil Service Commission, this Court having in fact, as

aforementioned, declared that the teachers affected may take appeals to the Civil Service Commission on said matters, if still timely. The threshold question is whether or not the Commission on Human Rights has the power under the Constitution to do so; whether or not, like a court of justice, 19 or even a quasi-judicial agency, 20 it has jurisdiction or adjudicatory powers over, or the power to try and decide, or hear and determine, certain specific type of cases, like alleged human rights violations involving civil or political rights. The Court declares the Commission on Human Rights to have no such power; and that it was not meant by the fundamental law to be another court or quasi-judicial agency in this country, or duplicate much less take over the functions of the latter. The most that may be conceded to the Commission in the way of adjudicative power is that it may investigate, i.e., receive evidence and make findings of fact as regards claimed human rights violations involving civil and political rights. But fact finding is not adjudication, and cannot be likened to the judicial function of a court of justice, or even a quasi-judicial agency or official. The function of receiving evidence and ascertaining therefrom the facts of a controversy is not a judicial function, properly speaking. To be considered such, the faculty of receiving evidence and making factual conclusions in a controversy must be accompanied by the authority of applying the law to those factual conclusions to the end that the controversy may be decided or determined authoritatively, finally and definitively, subject to such appeals or modes of review as may be provided by law. 21 This function, to repeat, the Commission does not have. 22

The proposition is made clear by the constitutional provisions specifying the powers of the Commission on Human Rights.

The Commission was created by the 1987 Constitution as an independent office. 23 Upon its constitution, it succeeded and superseded the Presidential Committee on Human Rights existing at the time of the effectivity of the Constitution. 24 Its powers and functions are the following 25

(1) Investigate, on its own or on complaint by any party, all forms of human rights violations involving civil and political rights;

(2) Adopt its operational guidelines and rules of procedure, and cite for contempt for violations thereof in accordance with the Rules of Court;

(3) Provide appropriate legal measures for the protection of human rights of all persons within the Philippines, as well as Filipinos residing abroad, and provide for preventive measures and legal aid services to the underprivileged whose human rights have been violated or need protection;

(4) Exercise visitorial powers over jails, prisons, or detention facilities;

(5) Establish a continuing program of research, education, and information to enhance respect for the primacy of human rights;

(6) Recommend to the Congress effective measures to promote human rights and to provide for compensation to victims of violations of human rights, or their families;

(7) Monitor the Philippine Government's compliance with international treaty obligations on human rights;

(8) Grant immunity from prosecution to any person whose testimony or whose possession of documents or other evidence is necessary or convenient to determine the truth in any investigation conducted by it or under its authority;

(9) Request the assistance of any department, bureau, office, or agency in the performance of its functions;

(10) Appoint its officers and employees in accordance with law; and

(11) Perform such other duties and functions as may be provided by law.

As should at once be observed, only the first of the enumerated powers and functions bears any resemblance to adjudication or adjudgment. The Constitution clearly and categorically grants to the Commission the power to investigate all forms of human rights violations involving civil and political rights. It can exercise that power on its own initiative or on complaint of any person. It may exercise that power pursuant to such rules of procedure as it may adopt and, in cases of violations of said rules, cite for contempt in accordance with the Rules of Court. In the course of any investigation conducted by it or under its authority, it may grant immunity from prosecution to any person whose testimony or whose possession of documents or other evidence is necessary or convenient to determine the truth. It may also request the assistance of any department, bureau, office, or agency in the performance of its functions, in the conduct of its investigation or in extending such remedy as may be required by its findings. 26

But it cannot try and decide cases (or hear and determine causes) as courts of justice, or even quasi-judicial bodies do. To investigate is not to adjudicate or adjudge. Whether in the popular or the technical sense, these terms have well understood and quite distinct meanings.

"Investigate," commonly understood, means to examine, explore, inquire or delve or probe into, research on, study. The dictionary definition of "investigate" is "to observe or study closely: inquire into systematically. "to search or inquire into: . . . to subject to an official probe . . .: to conduct an official inquiry." 27 The purpose of investigation, of course, is to discover, to find out, to learn, obtain information. Nowhere included or intimated is the notion of settling, deciding or resolving a controversy involved in the facts inquired into by application of the law to the facts established by the inquiry. The legal meaning of "investigate" is essentially the same: "(t)o follow up step by step by patient inquiry or observation. To trace or track; to search into; to examine and inquire into with care and accuracy; to find out by careful inquisition; examination; the taking of evidence; a legal inquiry;" 28 "to inquire; to make an investigation," "investigation" being in turn describe as "(a)n administrative function, the exercise of which ordinarily does not require a hearing. 2 Am J2d Adm L Sec. 257; . . . an inquiry, judicial or otherwise, for the discovery and collection of facts concerning a certain matter or matters." 29 "Adjudicate," commonly or popularly understood, means to adjudge, arbitrate, judge, decide, determine, resolve, rule on, settle. The dictionary defines the term as "to settle finally (the rights and duties of the parties to a court case) on the merits of issues raised: . . . to pass judgment on: settle judicially: . . . act as judge." 30 And "adjudge" means "to decide or rule upon as a judge or with judicial or quasi-judicial powers: . . . to award or grant judicially in a case of controversy . . . ." 31 In the legal sense, "adjudicate" means: "To settle in the exercise of judicial authority. To determine finally. Synonymous with adjudge in its strictest sense;" and "adjudge" means: "To pass on judicially, to decide, settle or decree, or to sentence or condemn. . . . Implies a judicial determination of a fact, and the entry of a judgment." 32

Hence it is that the Commission on Human Rights, having merely the power "to investigate," cannot and should not "try and resolve on the merits" (adjudicate) the matters involved in Striking Teachers HRC Case No. 90-775, as it has announced it means to do; and it cannot do so even if there be a claim that in the administrative disciplinary proceedings against the teachers in question, initiated and conducted by the DECS, their human rights, or civil or political rights had been transgressed. More particularly, the Commission has no power to "resolve on the merits" the question of (a) whether or not the mass concerted actions engaged in by the teachers constitute and are prohibited or otherwise restricted by law; (b) whether or not the act of carrying on and taking part in those actions, and the failure of the teachers to discontinue those actions, and return to

their classes despite the order to this effect by the Secretary of Education, constitute infractions of relevant rules and regulations warranting administrative disciplinary sanctions, or are justified by the grievances complained of by them; and (c) what where the particular acts done by each individual teacher and what sanctions, if any, may properly be imposed for said acts or omissions.

These are matters undoubtedly and clearly within the original jurisdiction of the Secretary of Education, being within the scope of the disciplinary powers granted to him under the Civil Service Law, and also, within the appellate jurisdiction of the Civil Service Commission.

Indeed, the Secretary of Education has, as above narrated, already taken cognizance of the issues and resolved them, 33 and it appears that appeals have been seasonably taken by the aggrieved parties to the Civil Service Commission; and even this Court itself has had occasion to pass upon said issues. 34

Now, it is quite obvious that whether or not the conclusions reached by the Secretary of Education in disciplinary cases are correct and are adequately based on substantial evidence; whether or not the proceedings themselves are void or defective in not having accorded the respondents due process; and whether or not the Secretary of Education had in truth committed "human rights violations involving civil and political rights," are matters which may be passed upon and determined through a motion for reconsideration addressed to the Secretary Education himself, and in the event of an adverse verdict, may be reviewed by the Civil Service Commission and eventually the Supreme Court.

The Commission on Human Rights simply has no place in this scheme of things. It has no business intruding into the jurisdiction and functions of the Education Secretary or the Civil Service Commission. It has no business going over the same ground traversed by the latter and making its own judgment on the questions involved. This would accord success to what may well have been the complaining teachers' strategy to abort, frustrate or negate the judgment of the Education Secretary in the administrative cases against them which they anticipated would be adverse to them.

This cannot be done. It will not be permitted to be done.

In any event, the investigation by the Commission on Human Rights would serve no useful purpose. If its investigation should result in conclusions contrary to those reached by Secretary Cariño, it would have no power anyway to reverse the Secretary's conclusions. Reversal thereof can only by done by the Civil Service Commission and lastly by this Court. The only thing the Commission can do, if it concludes that Secretary Cariño was in error, is to refer the matter to the appropriate Government agency or tribunal for assistance; that would be the Civil Service Commission. 35 It cannot arrogate unto itself the appellate jurisdiction of the Civil Service Commission. WHEREFORE, the petition is granted; the Order of December 29, 1990 is ANNULLED and SET ASIDE, and the respondent Commission on Human Rights and the Chairman and Members thereof are prohibited "to hear and resolve the case (i.e., Striking Teachers HRC Case No. 90-775) on the merits." SO ORDERED.

EN BANC G.R. No. L-27524 July 31, 1970 JOSE C. TECSON, petitioner-appellant, vs. HON. RAFAEL SALAS Executive Secretary, HON. ANTONIO V. RAQUIZA, Secretary of Public Works and Communications, HON. MARCIANO D. BAUTISTA, Undersecretary of Public Works and Communications, ALEJANDRO B. DELENA, Officer-In-Charge of the Bureau of Public Works, and Felix V. BAGTAS, Assistant Superintendent of Dredging Bureau of Public Works, respondentappellees.

Salva, Carballo & Associates and Edmundo M. Villanueva for petitioner. Office of the Solicitor General Antonio P. Barredo and Solicitor Augusto M. Amores for respondents-appellees. FERNANDO, J.: It was not a light burden petitioner Jose C. Tecson, Superintendent of Dredging, Bureau of Public Works, had taken upon himself seeking through this special civil action for certiorari and prohibition the nullification of his detail to the Office of the President according to a directive of the then Executive Secretary, Rafael Salas, acting by presidential authority, imputing to it the character of a removal without cause. 1Thus, on its face, it could not be asserted with confidence that the petition was sufficiently compelling. It was no surprise then that the lower court, the Honorable Juan O. Reyes presiding, sustained a motion to dismiss filed by respondents. The matter is now before us on appeal. The fate in store for it is not any different. There is no valid legal reason for reversing the lower court, the applicable legal norms grounded on a realistic appraisal of the power lodged in the President by the Constitution and statute alike calling for a recognition of such competence on his part. We affirm the order of dismissal.chanroblesvirtualawlibrarychanrobles virtual law library The amended petition for certiorari and prohibition filed against respondents on November 15, 1966 prayed that the detail dated October 14, 1966 of petitioner Superintendent of Dredging of the Bureau of Public Works to the Office of the President to assist in the San Fernando Port Project be declared illegal, null and void. There was a motion to dismiss filed on November 29, 1966 by the then Solicitor General, now a member of this Court, the Honorable Antonio P. Barredo, primarily based on a lack of cause of action, as the power of the then Executive Secretary, acting by authority of the President to detail petitioner, was beyond question. Such a motion elicited a favorable response from the lower court, as shown by its order of December 17, 1966 dismissing the petition without pronouncement as to costs and lifting the restraining order previously issued.chanroblesvirtualawlibrarychanrobles virtual law library The basic question was set forth in such order. Thus: "Stripping off the unnecessary allegations and data contained in the kilometric allegations of the petitioner and the respondents in their respective pleadings, and after a perusal of the amended petition, the Court finds that the principal issue between petitioner and the herein respondents in the amended petition, is whether or not the assignment of herein petitioner on temporary detail to the office of Commodore Santiago Nuval, Presidential Assistant on Ports and Harbors, by the President of the Philippines thru the Executive Secretary, constitutes removal from office without cause. 2It incorporated the challenged directive of the then Executive Secretary addressed to the Secretary of Public Works and worded as follows: "Mr. Jose G. Tecson, Superintendent of Dredging Bureau of Public Works, is hereby detailed to the Office of the President, effective immediately, to assist in the San Fernando Port Project. Mr. Tecson shall report directly to Commodore Santiago Nuval Presidential Assistant on Ports and Harbors." 3It was clearly set forth therein that it was issued "by authority of the President."chanrobles virtual law library Then came this portion of the lower Court's Order of dismissal: "It is to be presumed that the Presidential directive, thru the Salas Order, must have been decided by Malacañang in the interest of public service, and such official act should be considered regularly issued. Petitioner, however, argues that the Salas detail order although issued by Authority of the President, should be approved by the Budget Commissioner and the Commissioner of Civil Service as there is no specification of the period of assignment. This contention of the petitioner, if it were to be followed, would contravene the generally accepted principle which recognizes presidential 'power control' over the executive department. For then the acts of the President of the Philippines

would be subject to a subsequent approval or action by his subordinate officials in the executive department." 4Why there was no removal from office without cause was explained in such order thus: "The respondents further argue that the temporary assignment of the petitioner to the Office of the President is not a demotion in rank and salary. Neither is it to be considered as a disciplinary action taken against him. The detail does not involve removal from his present position by transferring him to another position in a lower class. He will retain his position as Superintendent of Dredging and will receive all the emoluments and privileges appurtenant thereto. In citing Sec. 32 of the Civil Service Act of 1959, petitioner seems to be of the impression that he is being transferred from one position to another, but this is not the case as regards the abovequoted detail order of Secretary Salas. The same Sec. 32 of Civil Service Act of 1959 provides 'that a transfer from one position to another without reduction in rank or salary shall not be considered disciplinary when made in the interest of public service'." 5It was the conclusion of the lower court, therefore, that there was likewise a statutory authority for such detail in the Office of the President, which was neither a demotion nor a disciplinary action and as such valid. Hence the order of dismissal.chanroblesvirtualawlibrarychanrobles virtual law library The matter was elevated to us on appeal, petitioner, now appellant, stressing that he had a valid cause of action as there was a removal or, at the very least, a transfer from his present position to another without his consent contrary to the constitutional provision, at the same time disputing the presidential authority under his power of control to order such a detail. On that issue decisive of this controversy, we find for respondents and, as noted, affirm the order of dismissal.chanroblesvirtualawlibrarychanrobles virtual law library 1. The basic philosophy of the presidential type of government adopted in our Constitution was expounded with force and lucidity by Justice Laurel in Villena v. Secretary of Interior 6in words the validity of which has not been impaired by the passage of time. It upheld in that case an order of suspension of the petitioner municipal mayor by such department head, notwithstanding the lack of statutory authority. This the Court was able to do, surmounting what otherwise should have been an insuperable obstacle, by attaching to such order of suspension the character of a presidential act. Thus: "After serious reflection, we have decided to sustain the contention of the government in this case on the broad proposition, albeit not suggested, that under the presidential type of government which we have adopted and considering the department organization established and continued in force by paragraph 1, section 12, Article VII, of our Constitution, all executive and administrative organizations are adjuncts of the Executive Department, the heads of the various executive departments are assistants and agents of the Chief Executive, and, except in cases where the Chief Executive is required by the Constitution or the law to act in person or the exigencies of the situation demand that he act personally, the multifarious executive and administrative functions of the Chief Executive are performed by and through the executive department and the acts of the secretaries of such departments, performed and promulgated in the regular course of business, are, unless disapproved or reprobated by the Chief Executive, presumptively the acts of the Chief Executive." 7chanrobles virtual law library Justice Laurel then proceeded to make clear why such an assumption is a logical corollary of the conferment of the totality of executive power in the President. As he pointed out: "With reference to the Executive Department of the Government, there is one purpose which is crystalclear and is readily visible without the projection of judicial searchlight, and that is, the establishment of a single, not plural, Executive. The first section of Article VII of the Constitution, dealing with the Executive Department, begins with the enunciation of the principle that 'The executive power shall be vested in a President of the Philippines.' This means that the President of the Philippines is the Executive of the Government of the Philippines, and no other. The heads of the executive departments occupy political positions and hold office in an advisory capacity,

and in the language of Thomas Jefferson, 'should be of the President's bosom confidence' (7 Writings, Ford ed., 498), and, in the language of Attorney-General Cushing (7 Op., AttorneyGeneral, 453). 'are subject to the direction of the President., Without minimizing the importance of the heads of the various departments, their personality is in reality but the projection of that of the President. Stated otherwise, and as forcibly characterized by Chief Justice Taft of the Supreme Court of the United States, 'each head of a department is, and must be, the President's alter ego in the matters of that department where the President is required by law to exercise authority' (Myers vs. United States, 47 Sup. Ct. Rep., 21 at 30: 272 U.S., 52 at 133; 71 Law. ed., 160)." 8chanrobles virtual law library A few months earlier, in Planas v. Gil, 9Justice Laurel already had occasion to emphasize such plenitude of authority vested in the President. These were his words then: "Viewed from the totality of powers conferred upon the Chief Executive by our Constitution, we should he reluctant to yield to the proposition that the President of the Philippines who is endowed with broad and extraordinary powers by our Constitution, and who is expected to govern with a firm and steady hand without vexatious or embarrassing interference and much less dictation from any source, is yet devoid of the power to order the investigation of the petitioner in this case. We should avoid that result." 1 0 It is true that insofar as presidential intervention over local affairs is concerned, the Villena decision no longer speaks with authority. It did lend itself to the criticism that it was not sufficiently mindful of the distinction under the Constitution delineating the power of the President to "have control of all the executive departments, bureaus, or offices" and his limited power to "exercise general supervision over all local governments as may be provided by law, ...," 1 1 In the Villena as well as the Planas vs. Gil cases, Justice Laurel appeared to have taken a rather expansive view of such supervisory authority, the effect of which could blur the line distinguishing it from control. Hebron vs. Reyes, 1 2 with the then Justice, now Chief Justice, Concepcion as the ponente, clarified matters. As was pointed cut, the presidential competence is not even supervision in general, but general supervision as may be provided by law. He could not thus go beyond the applicable statutory provisions, which bind and fetter his discretion on the matter. Moreover, as been earlier ruled in an opinion penned by Justice Padilla in Mondano v. Silvosa, 1 3 referred to by the present Chief Justice in his opinion in the Hebron case, supervision goes no further than "overseeing or the power or authority of an officer to see that subordinate officers perform their duties. If the latter fail or neglect to fulfill them the former may take such action or step as prescribed by law to make them perform their duties." 1 4 Control, on the other hand, "means the power of an officer to alter or modify or nullify or set aside what a subordinate had done in the performance of their duties and to substitute the judgment of the former for that of the latter." It would follow then, according to the present Chief Justice, to go back to the Hebron opinion, that the 'President had to abide by the then provisions of the Revised Administrative Code on suspension and removal of municipal officials, there being no power of control that he could rightfully exercise, the law clearly specifying the procedure by which such disciplinary action could be taken. 1 5 Insofar, however, as the power of control over all executive departments, bureaus or offices is concerned, the Villena ruling applies with undiminished force. 1 6 As a matter of fact, the present Chief Justice, in a decision rendered more than a year later after Hebron v. Reyes, People v. Jolliffe, 1 7 quoted extensively from the Villena ruling to stress what Justice Laurel referred to as the "qualified political agency" concept resulting in the "assumption of responsibility by the President of the Philippines for Acts of any member of his cabinet." No doubt can be entertained then as to the continuing vitality of the Villena doctrine concerning the plenitude of authority lodged in the President implicit in the power of control expressly granted him by the Constitution. 1 8 Nor should any restrictive significance be attached to the wording in the Mondano decision as to the implications of such concept considering that there was no need in

such case for a more elaborate treatment, all that was necessary being to distinguish it from supervision. In Pelaez v. Auditor General, 1 9 the present Chief Justice left no doubt as to its all embracing scope. Thus: "The power of control under this provision implies the right of the President to interfere in the exercise of such discretion as may be vested by law in the officers of the executive departments, bureaus, or offices of the national government, as well as to act in lieu of such officers." 2 0 The assertion then that such a broad grant of authority could not justify the challenged directive cannot be taken too seriously. If it were not so, the result would be not observance but defiance of a constitutional command.chanroblesvirtualawlibrarychanrobles virtual law library 2. The detail of petitioner to the Office of the President was thus unobjectionable. By no stretch of the imagination could it be considered a removal. It was not even a transfer. Even if it could be so viewed, the same conclusion would emerge, as such was allowable under the Civil Service Act provision then in force, so long as there be no reduction in rank or salary, such transfer therefore not being considered disciplinary when made in the interest of public service. 2 1 Nor is there any merit to the assertion made in the brief of petitioner that the directive of the Executive Secretary, acting upon authority of the President, needed the approval of the Civil Service Commission and the Commissioner of the Budget for its enforcement. Such a thought is repugnant to the very concept of a single, not a plural, executive in whom is vested the whole panoply of executive power. It is not only illogical, but it does not make sense, to require as a prerequisite to its validity the approval of subordinate to an action taken by their superior, the President, who tinder the Constitution is the Executive, all prerogatives attaching to such branch being vested in him solely. In that sense, for those discharging purely executive function in the national government, he lie gives orders to all and takes orders from none.chanroblesvirtualawlibrarychanrobles virtual law library 3. It would seem undisputed, then, that the lower court had no alternative but to dismiss the petition. The cause of action was clearly lacking. What was done did not amount to a removal. Moreover, the power of the President to order the detail was manifestly undeniable. It would likewise appear that petitioner failed to exhibit due deference to one of the fundamental postulates of government service, namely, that a public office is a public trust. While rightfully the Constitution guarantees the security of a public official's term, as well as his right to be compensated, there can be no disputing the truth of the assertion that the overriding concern is that the task of government be performed and performed well. One in public service, therefore, should not lack awareness that whatever talents he may possess should be beneficially employed for the public welfare, the determination as to where they should be devoted being ordinary left to the discretion of his superiors. In the language of Justice Sanchez in Sta. Maria v. Lopez, 2 2 "the use of approved techniques or methods in personnel management to harness the abilities of employees to promote the optimum public service cannot be objected to."chanrobles virtual law library When petitioner was therefore required to assist in the San Fernando Port Project, directly under the then Presidential Assistant on Ports and Harbors in the challenged directive of the Executive Secretary, acting by authority of the President, his duty as a public official was clear. He had to yield obedience. He ought to have known, as one of those entrusted with govermental functions, that what is controlling was not his choice of what should be done but what the interest of the service requires. It was made clear in the directive that he remained Superintendent of Dredging in the Bureau of Public Works. There was no demotion in rank. There was no diminution of salary. To give heed to his protest and invalidate such a detail, well within the power of the President, would be to nullify the concept of a public office being a public trust.chanroblesvirtualawlibrarychanrobles virtual law library

4. There is another consideration that militates against the stand of petitioner. The question before the judiciary in its appraisal of the validity of the acts of the President or of Congress is one of power. It is not for this Tribunal, much less for an inferior court, to inquire into the motives that may have prompted the exercise of a presidential authority. At the most, it can look into the question of whether there is legal justification for what was done. If the answer were in the affirmative, that disposes of the matter. In the same way that the judiciary has a right to expect that neither the President nor Congress would cast doubt on the mainspring of its orders or decisions, it should refrain from speculating as to alleged hidden forces at work that could have impelled either coordinate branch into acting the way it did. The concept of separation of powers presupposes mutual respect by and between the three departments of the government. At the very least then, the presumption is to be indulged in that the exertion of a legitimate governmental power springs from a belief that thereby public interest is served and the common weal promoted.chanroblesvirtualawlibrarychanrobles virtual law library WHEREFORE, the order of dismissal of December 17, 1966 is hereby affirmed. Without pronouncement as to costs.

[G.R. No. 111953. December 12, 1997]

HON. RENATO C. CORONA, in his capacity as Assistant Secretary for Legal Affairs, HON. JESUS B. GARCIA, in his capacity as Acting Secretary, Department of Transportation and Communications, and ROGELIO A. DAYAN, in his capacity as General Manager of Philippine Ports Authority, petitioners, vs. UNITED HARBOR PILOTS ASSOCIATION OF THE PHILIPPINES and MANILA PILOTS ASSOCIATION, respondents. DECISION ROMERO, J.: In issuing Administrative Order No. 04-92 (PPA-AO No. 04-92), limiting the term of appointment of harbor pilots to one year subject to yearly renewal or cancellation, did the Philippine Ports Authority (PPA) violate respondents right to exercise their profession and their right to due process of law? The PPA was created on July 11, 1974, by virtue of Presidential Decree No. 505. On December 23, 1975, Presidential Decree No. 857 was issued revising the PPAs charter. Pursuant to its power of control, regulation, and supervision of pilots and the pilotage profession, [1] the PPA promulgated PPA-AO-03-85 [2] on March 21, 1985, which embodied the Rules and Regulations Governing Pilotage Services, the Conduct of Pilots and Pilotage Fees in Philippine Ports. These rules mandate, inter alia, that aspiring pilots must be holders of pilot licenses [3] and must train as probationary pilots in outports for three months and in the Port of Manila for four months. It is only after they have achieved satisfactory performance [4] that they are given permanent and regular appointments by the PPA itself [5] to exercise harbor pilotage until they reach the age of 70, unless sooner removed by reason of mental or physical unfitness by the PPA General Manager. [6]Harbor pilots in every harbor district are further required to organize themselves into pilot associations which would make available such equipment as may be required by the PPA for effective pilotage services. In view of this mandate, pilot associations invested in floating, communications, and office equipment. In fact, every new pilot appointed by the PPA automatically becomes a member of a pilot association and is required to pay a proportionate equivalent equity or capital before being allowed to assume his duties, as reimbursement to the association concerned of the amount it paid to his predecessor.

Subsequently, then PPA General Manager Rogelio A. Dayan issued PPA-AO No. 04-92 [7] on July 15, 1992, whose avowed policy was to instill effective discipline and thereby afford better protection to the port users through the improvement of pilotage services. This was implemented by providing therein that all existing regular appointments which have been previously issued either by the Bureau of Customs or the PPA shall remain valid up to 31 December 1992 onlyand that all appointments to harbor pilot positions in all pilotage districts shall, henceforth, be only for a term of one (1) year from date of effectivity subject to yearly renewal or cancellation by the Authority after conduct of a rigid evaluation of performance. On August 12, 1992, respondents United Harbor Pilots Association and the Manila Pilots Association, through Capt. Alberto C. Compas, questioned PPA-AO No. 04-92 before the Department of Transportation and Communication, but they were informed by then DOTC Secretary Jesus B. Garcia that the matter of reviewing, recalling or annulling PPAs administrative issuances lies exclusively with its Board of Directors as its governing body. Meanwhile, on August 31, 1992, the PPA issued Memorandum Order No. 08-92 [8] which laid down the criteria or factors to be considered in the reappointment of harbor pilots, viz.: (1) Qualifying Factors: [9] safety record and physical/mental medical exam report and (2) Criteria for Evaluation: [10]promptness in servicing vessels, compliance with PPA Pilotage Guidelines, number of years as a harbor pilot, average GRT of vessels serviced as pilot, awards/commendations as harbor pilot, and age. Respondents reiterated their request for the suspension of the implementation of PPA-AO No. 04-92, but Secretary Garcia insisted on his position that the matter was within the jurisdiction of the Board of Directors of the PPA. Compas appealed this ruling to the Office of the President (OP), reiterating his arguments before the DOTC. On December 23, 1992, the OP issued an order directing the PPA to hold in abeyance the implementation of PPA-AO No. 04-92. In its answer, the PPA countered that said administrative order was issued in the exercise of its administrative control and supervision over harbor pilots under Section 6-a (viii), Article IV of P. D. No. 857, as amended, and it, along with its implementing guidelines, was intended to restore order in the ports and to improve the quality of port services. On March 17, 1993, the OP, through then Assistant Executive Secretary for Legal Affairs Renato C. Corona, dismissed the appeal/petition and lifted the restraining order issued earlier. [11] He concluded that PPAAO No. 04-92 applied to all harbor pilots and, for all intents and purposes, was not the act of Dayan, but of the PPA, which was merely implementing Section 6 of P.D. No. 857, mandating it to control, regulate and supervise pilotage and conduct of pilots in any port district. On the alleged unconstitutionality and illegality of PPA-AO No. 04-92 and its implementing memoranda and circulars, Secretary Corona opined that: The exercise of ones profession falls within the constitutional guarantee against wrongful deprivation of, or interference with, property rights without due process. In the limited context of this case, PPA-AO 04-92 does not constitute a wrongful interference with, let alone a wrongful deprivation of, the property rights of those affected thereby. As may be noted, the issuance aims no more than to improve pilotage services by limiting the appointment to harbor pilot positions to one year, subject to renewal or cancellation after a rigid evaluation of the appointees performance. PPA-AO 04-92 does not forbid, but merely regulates, the exercise by harbor pilots of their profession in PPAs jurisdictional area. (Emphasis supplied) Finally, as regards the alleged absence of ample prior consultation before the issuance of the administrative order, Secretary Corona cited Section 26 of P.D. No. 857, which merely requires the PPA to consult with relevant Government agencies. Since the PPA Board of Directors is composed of the Secretaries of the DOTC, the Department of Public Works and Highways, the Department of Finance, and the Department of Environment and Natural Resources, as well as the Director-General of the National Economic Development Agency, the Administrator of the Maritime Industry Authority (MARINA), and the private sector representative who, due to his knowledge and expertise, was appointed by the President to the Board, he concluded that the law has been sufficiently complied with by the PPA in issuing the assailed administrative order.

Consequently, respondents filed a petition for certiorari, prohibition and injunction with prayer for the issuance of a temporary restraining order and damages, before Branch 6 of the Regional Trial Court of Manila, which was docketed as Civil Case No. 93-65673. On September 6, 1993, the trial court rendered the following judgment: [12] WHEREFORE, for all the foregoing, this Court hereby rules that: 1. Respondents (herein petitioners) have acted in excess of jurisdiction and with grave abuse of discretion and in a capricious, whimsical and arbitrary manner in promulgating PPA Administrative Order 04-92 including all its implementing Memoranda, Circulars and Orders; 2. PPA Administrative Order 04-92 and its implementing Circulars and Orders are declared null and void; 3. The respondents are permanently enjoined from implementing PPA Administrative Order 04-92 and its implementing Memoranda, Circulars and Orders. No costs. SO ORDERED. The court a quo pointed out that the Bureau of Customs, the precursor of the PPA, recognized pilotage as a profession and, therefore, a property right under Callanta v. Carnation Philippines, Inc. [13] Thus, abbreviating the term within which that privilege may be exercised would be an interference with the property rights of the harbor pilots. Consequently, any withdrawal or alteration of such property right must be strictly made in accordance with the constitutional mandate of due process of law. This was apparently not followed by the PPA when it did not conduct public hearings prior to the issuance of PPA-AO No. 04-92; respondents allegedly learned about it only after its publication in the newspapers. From this decision, petitioners elevated their case to this Court on certiorari. After carefully examining the records and deliberating on the arguments of the parties, the Court is convinced that PPA-AO No. 04-92 was issued in stark disregard of respondents right against deprivation of property without due process of law. Consequently, the instant petition must be denied. Section 1 of the Bill of Rights lays down what is known as the due process clause of the Constitution, viz.: SECTION 1. No person shall be deprived of life, liberty, or property without due process of law, x x x. In order to fall within the aegis of this provision, two conditions must concur, namely, that there is a deprivation and that such deprivation is done without proper observance of due process. When one speaks of due process of law, however, a distinction must be made between matters of procedure and matters of substance. In essence, procedural due process refers to the method or manner by which the law is enforced, while substantive due process requires that the law itself, not merely the procedures by which the law would be enforced, is fair, reasonable, and just. [14] PPA-AO No. 04-92 must be examined in light of this distinction. Respondents argue that due process was not observed in the adoption of PPA-AO No. 04-92 allegedly because no hearing was conducted whereby relevant government agencies and the pilots themselves could ventilate their views. They are obviously referring to the procedural aspect of the enactment. Fortunately, the Court has maintained a clear position in this regard, a stance it has stressed in the recent case of Lumiqued v. Hon. Exevea, [15] where it declared that (a)s long as a party was given the opportunity to defend his interests in due course, he cannot be said to have been denied due process of law, for this opportunity to be heard is the very essence of due process. Moreover, this constitutional mandate is deemed satisfied if a person is granted an opportunity to seek reconsideration of the action or ruling complained of. In the case at bar, respondents questioned PPA-AO No. 04-92 no less than four times [16] before the matter was finally elevated to this Tribunal. Their arguments on this score, however, fail to persuade. While respondents emphasize that the Philippine Coast Guard, which issues the licenses of pilots after administering the pilots examinations, was not consulted, [17] the facts show that the MARINA, which took over the licensing function of the Philippine Coast Guard, was duly represented in the Board of Directors of the PPA. Thus,

petitioners correctly argued that, there being no matters of naval defense involved in the issuance of the administrative order, the Philippine Coast Guard need not be consulted.[18] Neither does the fact that the pilots themselves were not consulted in any way taint the validity of the administrative order. As a general rule, notice and hearing, as the fundamental requirements of procedural due process, are essential only when an administrative body exercises its quasi-judicial function. In the performance of its executive or legislative functions, such as issuing rules and regulations, an administrative body need not comply with the requirements of notice and hearing.[19] Upon the other hand, it is also contended that the sole and exclusive right to the exercise of harbor pilotage by pilots is a settled issue. Respondents aver that said right has become vested and can only be withdrawn or shortened by observing the constitutional mandate of due process of law. Their argument has thus shifted from the procedural to one of substance. It is here where PPA-AO No. 04-92 fails to meet the condition set by the organic law. There is no dispute that pilotage as a profession has taken on the nature of a property right. Even petitioner Corona recognized this when he stated in his March 17, 1993, decision that (t)he exercise of ones profession falls within the constitutional guarantee against wrongful deprivation of, or interference with, property rights without due process. [20] He merely expressed the opinion that (i)n the limited context of this case, PPA-AO 04-92 does not constitute a wrongful interference with, let alone a wrongful deprivation of, the property rights of those affected thereby, and that PPA-AO 04-92 does not forbid, but merely regulates, the exercise by harbor pilots of their profession. As will be presently demonstrated, such supposition is gravely erroneous and tends to perpetuate an administrative order which is not only unreasonable but also superfluous. Pilotage, just like other professions, may be practiced only by duly licensed individuals. Licensure is the granting of license especially to practice a profession. It is also the system of granting licenses (as for professional practice) in accordance with established standards. [21] A license is a right or permission granted by some competent authority to carry on a business or do an act which, without such license, would be illegal. [22] Before harbor pilots can earn a license to practice their profession, they literally have to pass through the proverbial eye of a needle by taking, not one but fiveexaminations, each followed by actual training and practice. Thus, the court a quo observed: Petitioners (herein respondents) contend, and the respondents (herein petitioners) do not deny, that here (sic) in this jurisdiction, before a person can be a harbor pilot, he must pass five (5) government professional examinations, namely, (1) For Third Mate and after which he must work, train and practice on board a vessel for at least a year; (2) For Second Mate and after which he must work, train and practice for at least a year; (3) For Chief Mate and after which he must work, train and practice for at least a year; (4) For a Master Mariner and after which he must work as Captain of vessels for at least two (2) years to qualify for an examination to be a pilot; and finally, of course, that given for pilots. Their license is granted in the form of an appointment which allows them to engage in pilotage until they retire at the age 70 years. This is a vested right.Under the terms of PPA-AO No. 04-92, (a)ll existing regular appointments which have been previously issued by the Bureau of Customs or the PPA shall remain valid up to 31 December 1992 only, and (a)ll appointments to harbor pilot positions in all pilotage districts shall, henceforth, be only for a term of one (1) year from date of effectivity subject to renewal or cancellation by the Authority after conduct of a rigid evaluation of performance. It is readily apparent that PPA-AO No. 04-92 unduly restricts the right of harbor pilots to enjoy their profession before their compulsory retirement. In the past, they enjoyed a measure of security knowing that after passing five examinations and undergoing years of on-the-job training, they would have a license which they could use until their retirement, unless sooner revoked by the PPA for mental or physical unfitness. Under the new issuance, they have to contend with an annual cancellation of their license which can be temporary or permanent depending on the outcome of their performance evaluation. Veteran pilots and neophytes alike are suddenly confronted with one-year terms which ipso facto expire at the end of that period. Renewal of their license is now dependent on a rigid evaluation of performance which is conducted only after the license has already been cancelled. Hence, the use of the term renewal. It is this pre-evaluation cancellation which primarily makes PPA-AO No. 04-92 unreasonable and constitutionally infirm. In a real sense, it is a deprivation of property without due process of law.

The Court notes that PPA-AO No. 04-92 and PPA-MO No. 08-92 are already covered by PPA-AO No. 0385, which is still operational. Respondents are correct in pointing out that PPA-AO No. 04-92 is a surplusage [23] and, therefore, an unnecessary enactment. PPA-AO 03-85 is a comprehensive order setting forth the Rules and Regulations Governing Pilotage Services, the Conduct of Pilots and Pilotage Fees in Philippine Ports. It provides, inter alia, for the qualification, appointment, performance evaluation, disciplining and removal of harbor pilots - matters which are duplicated in PPA-AO No. 04-92 and its implementing memorandum order. Since it adds nothing new or substantial, PPA-AO No. 04-92 must be struck down. Finally, respondents insinuation that then PPA General Manager Dayan was responsible for the issuance of the questioned administrative order may have some factual basis; after all, power and authority were vested in his office to propose rules and regulations. The trial courts finding of animosity between him and private respondents might likewise have a grain of truth. Yet the number of cases filed in court between private respondents and Dayan, including cases which have reached this Court, cannot certainly be considered the primordial reason for the issuance of PPA-AO No. 04-92. In the absence of proof to the contrary,Dayan should be presumed to have acted in accordance with law and the best of professional motives. In any event, his actions are certainly always subject to scrutiny by higher administrative authorities. WHEREFORE, the instant petition is hereby DISMISSED and the assailed decision of the court a quo dated September 6, 1993, in Civil Case No. 93-65673 is AFFIRMED. No pronouncement as to costs. SO ORDERED.

[G.R. No. 119761. August 29, 1996]

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. HON. COURT OF APPEALS, HON. COURT OF TAX APPEALS and FORTUNE TOBACCO CORPORATION, respondents. DECISION VITUG, J.: The Commissioner of Internal Revenue ("CIR") disputes the decision, dated 31 March 1995, of respondent Court of Appeals[1] affirming the 10th August 1994 decision and the 11th October 1994 resolution of the Court of Tax Appeals[2] ("CTA") in C.T.A. Case No. 5015, entitled "Fortune Tobacco Corporation vs. Liwayway Vinzons-Chato in her capacity as Commissioner of Internal Revenue." The facts, by and large, are not in dispute. Fortune Tobacco Corporation ("Fortune Tobacco") is engaged in the manufacture of different brands of cigarettes. On various dates, the Philippine Patent Office issued to the corporation separate certificates of trademark registration over "Champion," "Hope," and "More" cigarettes. In a letter, dated 06 January 1987, of then Commissioner of Internal Revenue Bienvenido A. Tan, Jr., to Deputy Minister Ramon Diaz of the Presidential Commission on Good Government, "the initial position of the Commission was to classify 'Champion,' 'Hope,' and 'More' as foreign brands since they were listed in the World Tobacco Directory as belonging to foreign companies. However, Fortune Tobacco changed the names of 'Hope' to Hope Luxury' and 'More' to 'Premium More,' thereby removing the said brands from the foreign brand category. Proof was also submitted to the Bureau (of Internal Revenue ['BIR']) that 'Champion' was an original Fortune Tobacco Corporation register and therefore a local brand."[3] Ad Valorem taxes were imposed on these brands,[4] at the following rates:

"BRAND AD VALOREM TAX RATE E.O. 22

06-23-86 07-01-86 and E.O. 273 07-25-87 01-01-88 RA 6956 06-18-90 07-05-90

Hope Luxury M. 100's Sec. 142, (c), (2) 40% 45% Hope Luxury M. King Sec. 142, (c), (2) 40% 45% More Premium M. 100's Sec. 142, (c), (2) 40% 45% More Premium International Sec. 142, (c), (2) 40% 45% Champion Int'l. M. 100's Sec. 142, (c), (2) 40% 45% Champion M. 100's Sec. 142, (c), (2) 40% 45% Champion M. King Sec. 142, (c), last par. 15% 20% Champion Lights Sec. 142, (c), last par. 15% 20%"[5] A bill, which later became Republic Act ("RA") No. 7654, [6] was enacted, on 10 June 1993, by the legislature and signed into law, on 14 June 1993, by the President of the Philippines. The new law became effective on 03 July 1993. It amended Section 142(c)(1) of the National Internal Revenue Code ("NIRC") to read; as follows: "SEC. 142. Cigars and Cigarettes. "x x x x x x x x x. "(c) Cigarettes packed by machine. - There shall be levied, assessed and collected on cigarettes packed by machine a tax at the rates prescribed below based on the constructive manufacturer's wholesale price or the actual manufacturer's wholesale price, whichever is higher: "(1) On locally manufactured cigarettes which are currently classified and taxed at fifty-five percent (55%) or the exportation of which is not authorized by contract or otherwise, fifty-five (55%) provided that the minimum tax shall not be less than Five Pesos (P5.00) per pack. "(2). On other locally manufactured cigarettes, forty-five percent (45%) provided that the minimum tax shall not be less than Three Pesos (P3.00) per pack.

"x x x x x x x x x. "When the registered manufacturer's wholesale price or the actual manufacturer's wholesale price whichever is higher of existing brands of cigarettes, including the amounts intended to cover the taxes, of cigarettes packed in twenties does not exceed Four Pesos and eighty centavos (P4.80) per pack, the rate shall be twenty percent (20%)." [7] (Italics supplied.) About a month after the enactment and two (2) days before the effectivity of RA 7654, Revenue Memorandum Circular No. 37-93 ("RMC 37-93"), was issued by the BIR the full text of which expressed: "REPUBLIKA NG PILIPINAS KAGAWARAN NG PANANALAPI KAWANIHAN NG RENTAS INTERNAS July 1, 1993 REVENUE MEMORANDUM CIRCULAR NO. 37-93 SUBJECT : Reclassification of Cigarettes Subject to Excise Tax TO : All Internal Revenue Officers and Others Concerned. "In view of the issues raised on whether 'HOPE,' 'MORE' and 'CHAMPION' cigarettes which are locally manufactured are appropriately considered as locally manufactured cigarettes bearing a foreign brand, this Office is compelled to review the previous rulings on the matter. "Section 142(c)(1) National Internal Revenue Code, as amended by R.A. No. 6956, provides: "'On locally manufactured cigarettes bearing a foreign brand, fifty-five percent (55%) Provided, That this rate shall apply regardless of whether or not the right to use or title to the foreign brand was sold or transferred by its owner to the local manufacturer. Whenever it has to be determined whether or not a cigarette bears a foreign brand, the listing of brands manufactured in foreign countries appearing in the current World Tobacco Directory shall govern." "Under the foregoing, the test for imposition of the 55% ad valorem tax on cigarettes is that the locally manufactured cigarettes bear a foreign brand regardless of whether or not the right to use or title to the foreign brand was sold or transferred by its owner to the local manufacturer. The brand must be originally owned by a foreign manufacturer or producer. If ownership of the cigarette brand is, however, not definitely determinable, 'x x x the listing of brands manufactured in foreign countries appearing in the current World Tobacco Directory shall govern. x x x' "'HOPE' is listed in the World Tobacco Directory as being manufactured by (a) Japan Tobacco, Japan and (b) Fortune Tobacco, Philippines. 'MORE' is listed in the said directory as being manufactured by: (a) Fills de Julia Reig, Andorra; (b) Rothmans, Australia; (c) RJR-Macdonald, Canada; (d) Rettig-Strenberg, Finland; (e) Karellas, Greece; (f) R.J. Reynolds, Malaysia; (g) Rothmans, New Zealand; (h) Fortune Tobacco, Philippines; (i) R.J. Reynolds, Puerto Rico; (j) R.J. Reynolds, Spain; (k) Tabacalera, Spain; (l) R.J. Reynolds, Switzerland; and (m) R.J. Reynolds, USA. 'Champion' is registered in the said directory as being manufactured by (a) Commonwealth Bangladesh; (b) Sudan, Brazil; (c) Japan Tobacco, Japan; (d) Fortune Tobacco, Philippines; (e) Haggar, Sudan; and (f) Tabac Reunies, Switzerland. "Since there is no showing who among the above-listed manufacturers of the cigarettes bearing the said brands are the real owner/s thereof, then it follows that the same shall be considered foreign brand for purposes of determining the ad valorem tax pursuant to Section 142 of the National Internal Revenue Code. As held in BIR Ruling No. 410-88, dated August 24, 1988, 'in cases where it cannot be established or there is dearth of evidence as to whether a brand is foreign or not, resort to the World Tobacco Directory should be made.' "In view of the foregoing, the aforesaid brands of cigarettes, viz: 'HOPE,' 'MORE' and 'CHAMPION' being manufactured by Fortune Tobacco Corporation are hereby considered locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on cigarettes.

"Any ruling inconsistent herewith is revoked or modified accordingly. (SGD) LIWAYWAY VINZONS-CHATO Commissioner" On 02 July 1993, at about 17:50 hours, BIR Deputy Commissioner Victor A. Deoferio, Jr., sent via telefax a copy of RMC 37-93 to Fortune Tobacco but it was addressed to no one in particular. On 15 July 1993, Fortune Tobacco received, by ordinary mail, a certified xerox copy of RMC 37-93. In a letter, dated 19 July 1993, addressed to the appellate division of the BIR, Fortune Tobacco, requested for a review, reconsideration and recall of RMC 37-93. The request was denied on 29 July 1993. The following day, or on 30 July 1993, the CIR assessed Fortune Tobacco for ad valorem tax deficiency amounting to P9,598,334.00. On 03 August 1993, Fortune Tobacco filed a petition for review with the CTA. [8] On 10 August 1994, the CTA upheld the position of Fortune Tobacco and adjudged: "WHEREFORE, Revenue Memorandum Circular No. 37-93 reclassifying the brands of cigarettes, viz: `HOPE,' `MORE' and `CHAMPION' being manufactured by Fortune Tobacco Corporation as locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on cigarettes is found to be defective, invalid and unenforceable, such that when R.A. No. 7654 took effect on July 3, 1993, the brands in question were not CURRENTLY CLASSIFIED AND TAXED at 55% pursuant to Section 1142(c)(1) of the Tax Code, as amended by R.A. No. 7654 and were therefore still classified as other locally manufactured cigarettes and taxed at 45% or 20% as the case may be. "Accordingly, the deficiency ad valorem tax assessment issued on petitioner Fortune Tobacco Corporation in the amount of P9,598,334.00, exclusive of surcharge and interest, is hereby canceled for lack of legal basis. "Respondent Commissioner of Internal Revenue is hereby enjoined from collecting the deficiency tax assessment made and issued on petitioner in relation to the implementation of RMC No. 37-93. "SO ORDERED." [9] In its resolution, dated 11 October 1994, the CTA dismissed for lack of merit the motion for reconsideration. The CIR forthwith filed a petition for review with the Court of Appeals, questioning the CTA's 10th August 1994 decision and 11th October 1994 resolution. On 31 March 1993, the appellate court's Special Thirteenth Division affirmed in all respects the assailed decision and resolution. In the instant petition, the Solicitor General argues: That "I. RMC 37-93 IS A RULING OR OPINION OF THE COMMISSIONER OF INTERNAL REVENUE INTERPRETING THE PROVISIONS OF THE TAX CODE. "II. BEING AN INTERPRETATIVE RULING OR OPINION, THE PUBLICATION OF RMC 37-93, FILING OF COPIES THEREOF WITH THE UP LAW CENTER AND PRIOR HEARING ARE NOT NECESSARY TO ITS VALIDITY, EFFECTIVITY AND ENFORCEABILITY. "III. PRIVATE RESPONDENT IS DEEMED TO HAVE BEEN NOTIFIED OR RMC 37-93 ON JULY 2, 1993. IV. RMC 37-93 IS NOT DISCRIMINATORY SINCE IT APPLIES TO ALL LOCALLY MANUFACTURED CIGARETTES SIMILARLY SITUATED AS 'HOPE,' 'MORE' AND 'CHAMPION' CIGARETTES. "V. PETITIONER WAS NOT LEGALLY PROSCRIBED FROM RECLASSIFYING HOPE, MORE AND CHAMPION CIGARETTES BEFORE THE EFFECTIVITY OF R.A. NO. 7654.

VI. SINCE RMC 37-93 IS AN INTERPRETATIVE RULE, THE INQUIRY IS NOT INTO ITS VALIDITY, EFFECTIVITY OR ENFORCEABILITY BUT INTO ITS CORRECTNESS OR PROPRIETY; RMC 37-93 IS CORRECT." [10] In fine, petitioner opines that RMC 37-93 is merely an interpretative ruling of the BIR which can thus become effective without any prior need for notice and hearing, nor publication, and that its issuance is not discriminatory since it would apply under similar circumstances to all locally manufactured cigarettes. The Court must sustain both the appellate court and the tax court. Petitioner stresses on the wide and ample authority of the BIR in the issuance of rulings for the effective implementation of the provisions of the National Internal Revenue Code. Let it be made clear that such authority of the Commissioner is not here doubted. Like any other government agency, however, the CIR may not disregard legal requirements or applicable principles in the exercise of its quasi-legislative powers. Let us first distinguish between two kinds of administrative issuances - a legislative rule and an interpretative rule. In Misamis Oriental Association of Coco Traders, Inc., vs. Department of Finance Secretary, [11] the Court expressed: "x x x a legislative rule is in the nature of subordinate legislation, designed to implement a primary legislation by providing the details thereof. In the same way that laws must have the benefit of public hearing, it is generally required that before a legislative rule is adopted there must be hearing. In this connection, the Administrative Code of 1987 provides: "Public Participation. - If not otherwise required by law, an agency shall, as far as practicable, publish or circulate notices of proposed rules and afford interested parties the opportunity to submit their views prior to the adoption of any rule. "(2) In the fixing of rates, no rule or final order shall be valid unless the proposed rates shall have been published in a newspaper of general circulation at least two (2) weeks before the first hearing thereon. "(3) In case of opposition, the rules on contested cases shall be observed. "In addition such rule must be published. On the other hand, interpretative rules are designed to provide guidelines to the law which the administrative agency is in charge of enforcing." [12] It should be understandable that when an administrative rule is merely interpretative in nature, its applicability needs nothing further than its bare issuance for it gives no real consequence more than what the law itself has already prescribed. When, upon the other hand, the administrative rule goes beyond merely providing for the means that can facilitate or render least cumbersome the implementation of the law but substantially adds to or increases the burden of those governed, it behooves the agency to accord at least to those directly affected a chance to be heard, and thereafter to be duly informed, before that new issuance is given the force and effect of law. A reading of RMC 37-93, particularly considering the circumstances under which it has been issued, convinces us that the circular cannot be viewed simply as a corrective measure (revoking in the process the previous holdings of past Commissioners) or merely as construing Section 142(c)(1) of the NIRC, as amended, but has, in fact and most importantly, been made in order to place "Hope Luxury," "Premium More" and "Champion" within the classification of locally manufactured cigarettes bearing foreign brands and to thereby have them covered by RA 7654. Specifically, the new law would have its amendatory provisions applied to locally manufactured cigarettes which at the time of its effectivity were not so classified as bearing foreign brands. Prior to the issuance of the questioned circular, "Hope Luxury," "Premium More," and "Champion" cigarettes were in the category of locally manufactured cigarettes not bearing foreign brand subject to 45% ad valorem tax. Hence, without RMC 37-93, the enactment of RA 7654, would have had no new tax rate consequence on private respondent's products. Evidently, in order to place "Hope Luxury," "Premium More," and "Champion" cigarettes within the scope of the amendatory law and subject them to an increased tax rate, the now disputed RMC 37-93 had to be issued. In so doing, the BIR not simply interpreted the law; verily, it

legislated under its quasi-legislative authority. The due observance of the requirements of notice, of hearing, and of publication should not have been then ignored. Indeed, the BIR itself, in its RMC 10-86, has observed and provided: "RMC NO. 10-86 Effectivity of Internal Revenue Rules and Regulations "It has been observed that one of the problem areas bearing on compliance with Internal Revenue Tax rules and regulations is lack or insufficiency of due notice to the tax paying public. Unless there is due notice, due compliance therewith may not be reasonably expected. And most importantly, their strict enforcement could possibly suffer from legal infirmity in the light of the constitutional provision on `due process of law' and the essence of the Civil Code provision concerning effectivity of laws, whereby due notice is a basic requirement (Sec. 1, Art. IV, Constitution; Art. 2, New Civil Code). "In order that there shall be a just enforcement of rules and regulations, in conformity with the basic element of due process, the following procedures are hereby prescribed for the drafting, issuance and implementation of the said Revenue Tax Issuances: "(1). This Circular shall apply only to (a) Revenue Regulations; (b) Revenue Audit Memorandum Orders; and (c) Revenue Memorandum Circulars and Revenue Memorandum Orders bearing on internal revenue tax rules and regulations. "(2). Except when the law otherwise expressly provides, the aforesaid internal revenue tax issuances shall not begin to be operative until after due notice thereof may be fairly presumed. "Due notice of the said issuances may be fairly presumed only after the following procedures have been taken: "xxx xxx xxx "(5). Strict compliance with the foregoing procedures is enjoined." [13] Nothing on record could tell us that it was either impossible or impracticable for the BIR to observe and comply with the above requirements before giving effect to its questioned circular. Not insignificantly, RMC 37-93 might have likewise infringed on uniformity of taxation. Article VI, Section 28, paragraph 1, of the 1987 Constitution mandates taxation to be uniform and equitable. Uniformity requires that all subjects or objects of taxation, similarly situated, are to be treated alike or put on equal footing both in privileges and liabilities.[14] Thus, all taxable articles or kinds of property of the same class must be taxed at the same rate[15] and the tax must operate with the same force and effect in every place where the subject may be found. Apparently, RMC 37-93 would only apply to "Hope Luxury," Premium More" and "Champion" cigarettes and, unless petitioner would be willing to concede to the submission of private respondent that the circular should, as in fact my esteemed colleague Mr. Justice Bellosillo so expresses in his separate opinion, be considered adjudicatory in nature and thus violative of due process following the Ang Tibay[16] doctrine, the measure suffers from lack of uniformity of taxation. In its decision, the CTA has keenly noted that other cigarettes bearing foreign brands have not been similarly included within the scope of the circular, such as "1. Locally manufactured by ALHAMBRA INDUSTRIES, INC. (a) `PALM TREE' is listed as manufactured by office of Monopoly, Korea (Exhibit `R') "2. Locally manufactured by LA SUERTE CIGAR and CIGARETTE COMPANY

(a) `GOLDEN KEY' is listed being manufactured by United Tobacco, Pakistan (Exhibit `S') (b) `CANNON' is listed as being manufactured by Alpha Tobacco, Bangladesh (Exhibit `T') "3. Locally manufactured by LA PERLA INDUSTRIES, INC. (a) `WHITE HORSE' is listed as being manufactured by Rothman's, Malaysia (Exhibit `U') (b) `RIGHT' is listed as being manufactured by SVENSKA, Tobaks, Sweden (Exhibit `V-1') "4. Locally manufactured by MIGHTY CORPORATION (a) 'WHITE HORSE' is listed as being manufactured by Rothman's, Malaysia (Exhibit 'U-1') "5. Locally manufactured by STERLING TOBACCO CORPORATION (a) UNION' is listed as being manufactured by Sumatra Tobacco, Indonesia and Brown and Williamson, USA (Exhibit 'U-3') (b) WINNER' is listed as being manufactured by Alpha Tobacco, Bangladesh; Nanyang, Hongkong; Joo Lan, Malaysia; Pakistan Tobacco Co., Pakistan; Premier Tobacco, Pakistan and Haggar, Sudan (Exhibit 'U-4')." [17] The court quoted at length from the transcript of the hearing conducted on 10 August 1993 by the Committee on Ways and Means of the House of Representatives; viz: "THE CHAIRMAN. So you have specific information on Fortune Tobacco alone. You don't have specific information on other tobacco manufacturers. Now, there are other brands which are similarly situated. They are locally manufactured bearing foreign brands. And may I enumerate to you all these brands, which are also listed in the World Tobacco Directory x x x. Why were these brands not reclassified at 55 if your want to give a level playing field to foreign manufacturers? "MS. CHATO. Mr. Chairman, in fact, we have already prepared a Revenue Memorandum Circular that was supposed to come after RMC No. 37-93 which have really named specifically the list of locally manufactured cigarettes bearing a foreign brand for excise tax purposes and includes all these brands that you mentioned at 55 percent except that at that time, when we had to come up with this, we were forced to study the brands of Hope, More and Champion because we were given documents that would indicate the that these brands were actually being claimed or patented in other countries because we went by Revenue Memorandum Circular 1488 and we wanted to give some rationality to how it came about but we couldn't find the rationale there. And we really found based on our own interpretation that the only test that is given by that existing law would be registration in the World Tobacco Directory. So we came out with this proposed revenue memorandum circular which we forwarded to the Secretary of Finance except that at that point in time, we went by the Republic Act 7654 in Section 1 which amended Section 142, C-1, it said, that on locally manufactured cigarettes which are currently classified and taxed at 55 percent. So we were saying that when this law took effect in July 3 and if we are going to come up with this revenue circular thereafter, then I think our action would really be subject to question but we feel that . . . Memorandum Circular Number 37-93 would really cover even similarly situated brands. And in fact, it was really because of the study, the short time that we were given to study the matter that we could not include all the rest of the other brands that would have been really classified as foreign brand if we went by the law itself. I am sure that by the reading of the law, you would without that ruling by Commissioner Tan they would really have been included in the definition or in the classification of foregoing brands. These brands that you referred to or just read to us and in fact just for your information, we really came out with a proposed revenue memorandum circular for those brands. (Italics supplied) "Exhibit 'FF-2-C', pp. V-5 TO V-6, VI-1 to VI-3). "x x x x x x x x x.

"MS. CHATO. x x x But I do agree with you now that it cannot and in fact that is why I felt that we . . . I wanted to come up with a more extensive coverage and precisely why I asked that revenue memorandum circular that would cover all those similarly situated would be prepared but because of the lack of time and I came out with a study of RA 7654, it would not have been possible to really come up with the reclassification or the proper classification of all brands that are listed there. x x x' (italics supplied) (Exhibit 'FF-2d', page IX-1) "x x x x x x x x x. "HON. DIAZ. But did you not consider that there are similarly situated? "MS. CHATO. That is precisely why, Sir, after we have come up with this Revenue Memorandum Circular No. 37-93, the other brands came about the would have also clarified RMC 37-93 by I was saying really because of the fact that I was just recently appointed and the lack of time, the period that was allotted to us to come up with the right actions on the matter, we were really caught by the July 3 deadline. But in fact, We have already prepared a revenue memorandum circular clarifying with the other . . . does not yet, would have been a list of locally manufactured cigarettes bearing a foreign brand for excise tax purposes which would include all the other brands that were mentioned by the Honorable Chairman. (Italics supplied) (Exhibit 'FF-2-d,' par. IX-4)."18 All taken, the Court is convinced that the hastily promulgated RMC 37-93 has fallen short of a valid and effective administrative issuance. WHEREFORE, the decision of the Court of Appeals, sustaining that of the Court of Tax Appeals, is AFFIRMED. No costs. SO ORDERED.

G.R. No. 74457 March 20, 1987 RESTITUTO YNOT, petitioner, vs. INTERMEDIATE APPELLATE COURT, THE STATION COMMANDER, INTEGRATED NATIONAL POLICE, BAROTAC NUEVO, ILOILO and THE REGIONAL DIRECTOR, BUREAU OF ANIMAL INDUSTRY, REGION IV, ILOILO CITY, respondents. Ramon A. Gonzales for petitioner.

CRUZ, J.: The essence of due process is distilled in the immortal cry of Themistocles to Alcibiades "Strike — but hear me first!" It is this cry that the petitioner in effect repeats here as he challenges the constitutionality of Executive Order No. 626-A. The said executive order reads in full as follows: WHEREAS, the President has given orders prohibiting the interprovincial movement of carabaos and the slaughtering of carabaos not complying with the requirements of Executive Order No. 626 particularly with respect to age; WHEREAS, it has been observed that despite such orders the violators still manage to circumvent the prohibition against inter-provincial movement of carabaos by transporting carabeef instead; and WHEREAS, in order to achieve the purposes and objectives of Executive Order No. 626 and the prohibition against interprovincial movement of carabaos, it is necessary to strengthen the said

Executive Order and provide for the disposition of the carabaos and carabeef subject of the violation; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, do hereby promulgate the following: SECTION 1. Executive Order No. 626 is hereby amended such that henceforth, no carabao regardless of age, sex, physical condition or purpose and no carabeef shall be transported from one province to another. The carabao or carabeef transported in violation of this Executive Order as amended shall be subject to confiscation and forfeiture by the government, to be distributed to charitable institutions and other similar institutions as the Chairman of the National Meat Inspection Commission may ay see fit, in the case of carabeef, and to deserving farmers through dispersal as the Director of Animal Industry may see fit, in the case of carabaos. SECTION 2. This Executive Order shall take effect immediately. Done in the City of Manila, this 25th day of October, in the year of Our Lord, nineteen hundred and eighty. (SGD.) FERDINAND E. MARCOS President Republic of the Philippines The petitioner had transported six carabaos in a pump boat from Masbate to Iloilo on January 13, 1984, when they were confiscated by the police station commander of Barotac Nuevo, Iloilo, for violation of the above measure. 1 The petitioner sued for recovery, and the Regional Trial Court of Iloilo City issued a writ of replevin upon his filing of a supersedeas bond of P12,000.00. After considering the merits of the case, the court sustained the confiscation of the carabaos and, since they could no longer be produced, ordered the confiscation of the bond. The court also declined to rule on the constitutionality of the executive order, as raise by the petitioner, for lack of authority and also for its presumed validity. 2 The petitioner appealed the decision to the Intermediate Appellate Court,* 3 which upheld the trial court, ** and he has now come before us in this petition for review on certiorari. The thrust of his petition is that the executive order is unconstitutional insofar as it authorizes outright confiscation of the carabao or carabeef being transported across provincial boundaries. His claim is that the penalty is invalid because it is imposed without according the owner a right to be heard before a competent and impartial court as guaranteed by due process. He complains that the measure should not have been presumed, and so sustained, as constitutional. There is also a challenge to the improper exercise of the legislative power by the former President under Amendment No. 6 of the 1973 Constitution. 4 While also involving the same executive order, the case of Pesigan v. Angeles 5 is not applicable here. The question raised there was the necessity of the previous publication of the measure in the Official Gazette before it could be considered enforceable. We imposed the requirement then on the basis of due process of law. In doing so, however, this Court did not, as contended by the Solicitor General, impliedly affirm the constitutionality of Executive Order No. 626-A. That is an entirely different matter. This Court has declared that while lower courts should observe a becoming modesty in examining constitutional questions, they are nonetheless not prevented from resolving the same whenever warranted, subject only to review by the highest tribunal. 6 We have jurisdiction under the Constitution to "review, revise, reverse, modify or affirm on appeal or certiorari, as the law or rules of court may provide," final judgments and orders of lower courts in, among others, all cases involving the constitutionality of certain measures. 7 This simply means that the resolution of such cases may be made in the first instance by these lower courts.

And while it is true that laws are presumed to be constitutional, that presumption is not by any means conclusive and in fact may be rebutted. Indeed, if there be a clear showing of their invalidity, and of the need to declare them so, then "will be the time to make the hammer fall, and heavily," 8 to recall Justice Laurel's trenchant warning. Stated otherwise, courts should not follow the path of least resistance by simply presuming the constitutionality of a law when it is questioned. On the contrary, they should probe the issue more deeply, to relieve the abscess, paraphrasing another distinguished jurist, 9 and so heal the wound or excise the affliction. Judicial power authorizes this; and when the exercise is demanded, there should be no shirking of the task for fear of retaliation, or loss of favor, or popular censure, or any other similar inhibition unworthy of the bench, especially this Court. The challenged measure is denominated an executive order but it is really presidential decree, promulgating a new rule instead of merely implementing an existing law. It was issued by President Marcos not for the purpose of taking care that the laws were faithfully executed but in the exercise of his legislative authority under Amendment No. 6. It was provided thereunder that whenever in his judgment there existed a grave emergency or a threat or imminence thereof or whenever the legislature failed or was unable to act adequately on any matter that in his judgment required immediate action, he could, in order to meet the exigency, issue decrees, orders or letters of instruction that were to have the force and effect of law. As there is no showing of any exigency to justify the exercise of that extraordinary power then, the petitioner has reason, indeed, to question the validity of the executive order. Nevertheless, since the determination of the grounds was supposed to have been made by the President "in his judgment, " a phrase that will lead to protracted discussion not really necessary at this time, we reserve resolution of this matter until a more appropriate occasion. For the nonce, we confine ourselves to the more fundamental question of due process. It is part of the art of constitution-making that the provisions of the charter be cast in precise and unmistakable language to avoid controversies that might arise on their correct interpretation. That is the Ideal. In the case of the due process clause, however, this rule was deliberately not followed and the wording was purposely kept ambiguous. In fact, a proposal to delineate it more clearly was submitted in the Constitutional Convention of 1934, but it was rejected by Delegate Jose P. Laurel, Chairman of the Committee on the Bill of Rights, who forcefully argued against it. He was sustained by the body. 10 The due process clause was kept intentionally vague so it would remain also conveniently resilient. This was felt necessary because due process is not, like some provisions of the fundamental law, an "iron rule" laying down an implacable and immutable command for all seasons and all persons. Flexibility must be the best virtue of the guaranty. The very elasticity of the due process clause was meant to make it adapt easily to every situation, enlarging or constricting its protection as the changing times and circumstances may require. Aware of this, the courts have also hesitated to adopt their own specific description of due process lest they confine themselves in a legal straitjacket that will deprive them of the elbow room they may need to vary the meaning of the clause whenever indicated. Instead, they have preferred to leave the import of the protection open-ended, as it were, to be "gradually ascertained by the process of inclusion and exclusion in the course of the decision of cases as they arise." 11 Thus, Justice Felix Frankfurter of the U.S. Supreme Court, for example, would go no farther than to define due process — and in so doing sums it all up — as nothing more and nothing less than "the embodiment of the sporting Idea of fair play." 12 When the barons of England extracted from their sovereign liege the reluctant promise that that Crown would thenceforth not proceed against the life liberty or property of any of its subjects except by the lawful judgment of his peers or the law of the land, they thereby won for themselves and their progeny that splendid guaranty of fairness that is now the hallmark of the free society. The solemn vow that King John made at Runnymede in 1215 has since then resounded through the ages, as a ringing reminder to all rulers, benevolent or base, that every person, when confronted by the stern visage of the law, is entitled to have his say in a fair and open hearing of his cause. The closed mind has no place in the open society. It is part of the sporting Idea of fair play to hear "the other side" before an opinion is formed or a decision is made by those who sit in judgment. Obviously, one side is

only one-half of the question; the other half must also be considered if an impartial verdict is to be reached based on an informed appreciation of the issues in contention. It is indispensable that the two sides complement each other, as unto the bow the arrow, in leading to the correct ruling after examination of the problem not from one or the other perspective only but in its totality. A judgment based on less that this full appraisal, on the pretext that a hearing is unnecessary or useless, is tainted with the vice of bias or intolerance or ignorance, or worst of all, in repressive regimes, the insolence of power. The minimum requirements of due process are notice and hearing 13 which, generally speaking, may not be dispensed with because they are intended as a safeguard against official arbitrariness. It is a gratifying commentary on our judicial system that the jurisprudence of this country is rich with applications of this guaranty as proof of our fealty to the rule of law and the ancient rudiments of fair play. We have consistently declared that every person, faced by the awesome power of the State, is entitled to "the law of the land," which Daniel Webster described almost two hundred years ago in the famous Dartmouth College Case, 14 as "the law which hears before it condemns, which proceeds upon inquiry and renders judgment only after trial." It has to be so if the rights of every person are to be secured beyond the reach of officials who, out of mistaken zeal or plain arrogance, would degrade the due process clause into a worn and empty catchword. This is not to say that notice and hearing are imperative in every case for, to be sure, there are a number of admitted exceptions. The conclusive presumption, for example, bars the admission of contrary evidence as long as such presumption is based on human experience or there is a rational connection between the fact proved and the fact ultimately presumed therefrom. 15 There are instances when the need for expeditions action will justify omission of these requisites, as in the summary abatement of a nuisance per se, like a mad dog on the loose, which may be killed on sight because of the immediate danger it poses to the safety and lives of the people. Pornographic materials, contaminated meat and narcotic drugs are inherently pernicious and may be summarily destroyed. The passport of a person sought for a criminal offense may be cancelled without hearing, to compel his return to the country he has fled. 16 Filthy restaurants may be summarily padlocked in the interest of the public health and bawdy houses to protect the public morals. 17 In such instances, previous judicial hearing may be omitted without violation of due process in view of the nature of the property involved or the urgency of the need to protect the general welfare from a clear and present danger. The protection of the general welfare is the particular function of the police power which both restraints and is restrained by due process. The police power is simply defined as the power inherent in the State to regulate liberty and property for the promotion of the general welfare. 18 By reason of its function, it extends to all the great public needs and is described as the most pervasive, the least limitable and the most demanding of the three inherent powers of the State, far outpacing taxation and eminent domain. The individual, as a member of society, is hemmed in by the police power, which affects him even before he is born and follows him still after he is dead — from the womb to beyond the tomb — in practically everything he does or owns. Its reach is virtually limitless. It is a ubiquitous and often unwelcome intrusion. Even so, as long as the activity or the property has some relevance to the public welfare, its regulation under the police power is not only proper but necessary. And the justification is found in the venerable Latin maxims, Salus populi est suprema lex and Sic utere tuo ut alienum non laedas, which call for the subordination of individual interests to the benefit of the greater number. It is this power that is now invoked by the government to justify Executive Order No. 626-A, amending the basic rule in Executive Order No. 626, prohibiting the slaughter of carabaos except under certain conditions. The original measure was issued for the reason, as expressed in one of its Whereases, that "present conditions demand that the carabaos and the buffaloes be conserved for the benefit of the small farmers who rely on them for energy needs." We affirm at the outset the need for such a measure. In the face of the worsening energy crisis and the increased dependence of our farms on these traditional beasts of burden, the government would have been remiss, indeed, if it had not taken steps to protect and preserve them. A similar prohibition was challenged in United States v. Toribio, 19 where a law regulating the registration, branding and slaughter of large cattle was claimed to be a deprivation of property without due process of law. The defendant had been convicted thereunder for having slaughtered his own carabao without the required permit, and he appealed to the Supreme Court. The conviction was affirmed. The law was sustained as a valid police measure to prevent the indiscriminate killing of carabaos, which were then badly needed by farmers. An

epidemic had stricken many of these animals and the reduction of their number had resulted in an acute decline in agricultural output, which in turn had caused an incipient famine. Furthermore, because of the scarcity of the animals and the consequent increase in their price, cattle-rustling had spread alarmingly, necessitating more effective measures for the registration and branding of these animals. The Court held that the questioned statute was a valid exercise of the police power and declared in part as follows: To justify the State in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. ... From what has been said, we think it is clear that the enactment of the provisions of the statute under consideration was required by "the interests of the public generally, as distinguished from those of a particular class" and that the prohibition of the slaughter of carabaos for human consumption, so long as these animals are fit for agricultural work or draft purposes was a "reasonably necessary" limitation on private ownership, to protect the community from the loss of the services of such animals by their slaughter by improvident owners, tempted either by greed of momentary gain, or by a desire to enjoy the luxury of animal food, even when by so doing the productive power of the community may be measurably and dangerously affected. In the light of the tests mentioned above, we hold with the Toribio Case that the carabao, as the poor man's tractor, so to speak, has a direct relevance to the public welfare and so is a lawful subject of Executive Order No. 626. The method chosen in the basic measure is also reasonably necessary for the purpose sought to be achieved and not unduly oppressive upon individuals, again following the above-cited doctrine. There is no doubt that by banning the slaughter of these animals except where they are at least seven years old if male and eleven years old if female upon issuance of the necessary permit, the executive order will be conserving those still fit for farm work or breeding and preventing their improvident depletion. But while conceding that the amendatory measure has the same lawful subject as the original executive order, we cannot say with equal certainty that it complies with the second requirement, viz., that there be a lawful method. We note that to strengthen the original measure, Executive Order No. 626-A imposes an absolute ban not on the slaughter of the carabaos but on their movement, providing that "no carabao regardless of age, sex, physical condition or purpose (sic) and no carabeef shall be transported from one province to another." The object of the prohibition escapes us. The reasonable connection between the means employed and the purpose sought to be achieved by the questioned measure is missing We do not see how the prohibition of the inter-provincial transport of carabaos can prevent their indiscriminate slaughter, considering that they can be killed anywhere, with no less difficulty in one province than in another. Obviously, retaining the carabaos in one province will not prevent their slaughter there, any more than moving them to another province will make it easier to kill them there. As for the carabeef, the prohibition is made to apply to it as otherwise, so says executive order, it could be easily circumvented by simply killing the animal. Perhaps so. However, if the movement of the live animals for the purpose of preventing their slaughter cannot be prohibited, it should follow that there is no reason either to prohibit their transfer as, not to be flippant dead meat. Even if a reasonable relation between the means and the end were to be assumed, we would still have to reckon with the sanction that the measure applies for violation of the prohibition. The penalty is outright confiscation of the carabao or carabeef being transported, to be meted out by the executive authorities, usually the police only. In the Toribio Case, the statute was sustained because the penalty prescribed was fine and imprisonment, to be imposed by the court after trial and conviction of the accused. Under the challenged measure, significantly, no such trial is prescribed, and the property being transported is immediately impounded by the police and declared, by the measure itself, as forfeited to the government. In the instant case, the carabaos were arbitrarily confiscated by the police station commander, were returned to the petitioner only after he had filed a complaint for recovery and given a supersedeas bond of P12,000.00, which was ordered confiscated upon his failure to produce the carabaos when ordered by the trial court. The

executive order defined the prohibition, convicted the petitioner and immediately imposed punishment, which was carried out forthright. The measure struck at once and pounced upon the petitioner without giving him a chance to be heard, thus denying him the centuries-old guaranty of elementary fair play. It has already been remarked that there are occasions when notice and hearing may be validly dispensed with notwithstanding the usual requirement for these minimum guarantees of due process. It is also conceded that summary action may be validly taken in administrative proceedings as procedural due process is not necessarily judicial only. 20 In the exceptional cases accepted, however. there is a justification for the omission of the right to a previous hearing, to wit, the immediacy of the problem sought to be corrected and the urgency of the need to correct it. In the case before us, there was no such pressure of time or action calling for the petitioner's peremptory treatment. The properties involved were not even inimical per se as to require their instant destruction. There certainly was no reason why the offense prohibited by the executive order should not have been proved first in a court of justice, with the accused being accorded all the rights safeguarded to him under the Constitution. Considering that, as we held in Pesigan v. Angeles, 21 Executive Order No. 626-A is penal in nature, the violation thereof should have been pronounced not by the police only but by a court of justice, which alone would have had the authority to impose the prescribed penalty, and only after trial and conviction of the accused. We also mark, on top of all this, the questionable manner of the disposition of the confiscated property as prescribed in the questioned executive order. It is there authorized that the seized property shall "be distributed to charitable institutions and other similar institutions as the Chairman of the National Meat Inspection Commission may see fit, in the case of carabeef, and to deserving farmers through dispersal as the Director of Animal Industry may see fit, in the case of carabaos." (Emphasis supplied.) The phrase "may see fit" is an extremely generous and dangerous condition, if condition it is. It is laden with perilous opportunities for partiality and abuse, and even corruption. One searches in vain for the usual standard and the reasonable guidelines, or better still, the limitations that the said officers must observe when they make their distribution. There is none. Their options are apparently boundless. Who shall be the fortunate beneficiaries of their generosity and by what criteria shall they be chosen? Only the officers named can supply the answer, they and they alone may choose the grantee as they see fit, and in their own exclusive discretion. Definitely, there is here a "roving commission," a wide and sweeping authority that is not "canalized within banks that keep it from overflowing," in short, a clearly profligate and therefore invalid delegation of legislative powers. To sum up then, we find that the challenged measure is an invalid exercise of the police power because the method employed to conserve the carabaos is not reasonably necessary to the purpose of the law and, worse, is unduly oppressive. Due process is violated because the owner of the property confiscated is denied the right to be heard in his defense and is immediately condemned and punished. The conferment on the administrative authorities of the power to adjudge the guilt of the supposed offender is a clear encroachment on judicial functions and militates against the doctrine of separation of powers. There is, finally, also an invalid delegation of legislative powers to the officers mentioned therein who are granted unlimited discretion in the distribution of the properties arbitrarily taken. For these reasons, we hereby declare Executive Order No. 626-A unconstitutional. We agree with the respondent court, however, that the police station commander who confiscated the petitioner's carabaos is not liable in damages for enforcing the executive order in accordance with its mandate. The law was at that time presumptively valid, and it was his obligation, as a member of the police, to enforce it. It would have been impertinent of him, being a mere subordinate of the President, to declare the executive order unconstitutional and, on his own responsibility alone, refuse to execute it. Even the trial court, in fact, and the Court of Appeals itself did not feel they had the competence, for all their superior authority, to question the order we now annul. The Court notes that if the petitioner had not seen fit to assert and protect his rights as he saw them, this case would never have reached us and the taking of his property under the challenged measure would have become a faitaccompli despite its invalidity. We commend him for his spirit. Without the present challenge, the matter would have ended in that pump boat in Masbate and another violation of the Constitution, for all its

obviousness, would have been perpetrated, allowed without protest, and soon forgotten in the limbo of relinquished rights. The strength of democracy lies not in the rights it guarantees but in the courage of the people to invoke them whenever they are ignored or violated. Rights are but weapons on the wall if, like expensive tapestry, all they do is embellish and impress. Rights, as weapons, must be a promise of protection. They become truly meaningful, and fulfill the role assigned to them in the free society, if they are kept bright and sharp with use by those who are not afraid to assert them. WHEREFORE, Executive Order No. 626-A is hereby declared unconstitutional. Except as affirmed above, the decision of the Court of Appeals is reversed. The supersedeas bond is cancelled and the amount thereof is ordered restored to the petitioner. No costs. SO ORDERED.

EN BANC G.R. No. 89745

April 8, 1991

DR. RUFINO O. ESLAO, in his capacity as President of Pangasinan State University, petitioner, vs. THE COMMISSION ON AUDIT, respondent.

GANCAYCO, J.: The validity of a public works project and the right of the contractor to compensation therefor are in issue in this petition. The facts are undisputed. On December 22, 1986, the Pangasinan State University (PSU), represented by petitioner, Dr. Rufino O. Eslao, as President thereof, and C.T. Serna Consultants (Serna) entered into a conditional contract for the preparation of the perspective and detailed plans, specifications, bill of materials and estimates, programs of work and structural designs of an extension of the PSU Engineering Building at the Urdaneta, Pangasinan campus.1 Serna was particularly chosen because in 1983, it also designed the existing Engineering Building in the same campus. The cost estimates for said construction amounted to P1 Million (P1,000,000.00), which was equal to the agency estimate recommended by the Department of Public Works and Highways (DPWH) Regional Office I. On December 26, 1986, Serna turned over the finished plans and specifications and bill of materials and estimates to the university for submission to the MPWH (now DPWH) Regional Office I. The corresponding submission was prepared by petitioner addressed to Jose P. Solano, Director of Region I, San Fernando, La Union.2 For the completion and renovation of the Ceramics Building at PSU Lingayen, the university engineer prepared agency estimates in the amount of P599,763.65 and the project program of work. 3 These documents and their detailed estimates were prepared on December 26, 1986 or before the contract on the extension of the Ceramics Building was entered into between petitioner and SJC Construction. Copies of these engineering plans and estimates were likewise submitted to the DPWH Regional Office for approval. The details and plans of both the Engineering Building and Ceramics Building were actually approved on March 11, 1987 by the DPWH Regional Office.

The Advice of Allotment No. TC2-1132-86-4-02 appropriating funds in the amount of P1.6M for the foregoing projects (Engineering and Ceramics buildings) was released by the Department of Budget and Management (DBM) on December 29, 1986.4 Conscious of the time constraint and apprehensive that the university will lose the money when it reverts to the general funds if not obligated before the end of the year, as well as the opportunity to respond to its urgent need for more classrooms for its increasing student population, petitioner, on December 29, 1986 entered into two separate contracts with SJC construction: (1) For the completion, including the furnishing of materials and labor, of the Engineering Building at the PSU Urdaneta campus amounting to P960,000.00; and (2) For the completion, including the furnishing of materials and labor, of the Ceramics Building at the PSU Lingayen campus amounting to P582,000.00. Both amounts are lower than the appropriated amounts of P1,000,000.00 and P600,000.00, respectively.5 On February 16, 1987, the Board of Regents of PSU approved the subject contract under Resolution Nos. 12 and 12-A.6 On December 2, 1987, the Secretary of Education, Culture and Sports, Lourdes R. Quisumbing, approved the subject contracts.7 Meanwhile, copies of the contracts were forwarded to the Office of the Executive Secretary in Malacañang for the approval of the Office of the President. The contractor followed up these papers. As of January 19, 1987, both contracts appear to have been approved by the Office of the Executive Secretary through one Atty. Danilo T. Gardaya of the Presidential Legal Staff. Upon verification that there was no such person by the name of Danilo T. Gardaya in the Office of the Presidential Legal Staff of the Executive Secretary, the resident auditor of PSU issued on July 27, 1987 CSB No. 0727 disallowing the payments of P552,900.00 for the Ceramics Building and P912,000.00 for the Engineering Building, or a total disallowance of P1,464,900.00 based on the following grounds: (1) That the contracts were entered into in violation of IB2.5.2 (now IB2.4.2) of the Implementing Rules of P.D. No. 1594; (2) That the approval of the Office of the Executive Secretary on the face of the contracts is not genuine; and (3) That the contracts were entered into without the required engineering aspects as required in Section 2 of P.D. No. 1594.8 On June 18, 1987, petitioner wrote to the contractor informing him that upon his verification from the Office of the Deputy Executive Secretary he learned that the signature of Executive Secretary Joker Arroyo on the negotiated contract is not genuine so he advised the contractor to hold in abeyance the construction of the two projects.9 The Director of Region I of the Commission on Audit (COA) in a 2nd Indorsement dated September 3, 1987 concurred in the opinion of the PSU resident auditor. The matter was appealed by petitioner to respondent COA. In a 10th Indorsement dated March 30, 1988 to the Chairman of the respondent COA, Regional Director Arturo D. Dadufalza recommended the denial of the appeal.10 In COA Decision No. 736 contained in an 11th Indorsement dated February 9, 1989 to the Director of COA Regional Office No. 1, the COA denied the appeal and affirmed the subject disallowances.11 A motion for reconsideration thereof filed by the petitioner was denied in a resolution of respondent COA dated August 2, 1989.12 Hence, this petition, wherein the petitioner questions the decision of the respondent COA in that there was a violation of law in the transaction and affirming the disallowances. Petitioner alleges that since the advise of allotment of P1.6 Million for the said projects was released by the DBM only on December 29, 1986 or two days before the end of the fiscal year 1986, believing in good faith that the university will lose the appropriation if it is not obligated on or before December 31, 1986, petitioner entered into the disputed contracts with SJC Construction relying on Section 4 of P.D. No. 1594 which provides as follows:

. . . (P)rojects may be undertaken by administration or force account or by negotiated contract only in exceptional cases where time is of the essence, or where there is a lack of qualified bidders or contractors, or where there is conclusive evidence that greater economy and efficiency would be achieved through this arrangement, and in accordance with provisions of laws and acts on the matter, subject to the approval of the Ministry of Public Works, Transportation and Communications, the Minister of Public Highways, or the Minister of Energy, as the case may be, if the project cost is less than P1 Million and of the President of the Philippines upon the recommendation of the Minister, if the cost is P1 Million or more . . . . (Emphasis supplied.) Petitioner submits that the situation was "an exceptional case where time was of the essence," so that the petitioner did not go through the usual process of bidding out the construction work; otherwise, the university would have lost the money and would have failed to address its pressing problem of lack of classrooms for its growing student population. Petitioner admits that IB 242 of the Implementing Rules of P.D. No. 1594 specifies the instances where negotiated contracts may be availed of, as follows: a. In times of emergencies arising from natural calamities, where immediate action is necessary to prevent imminent loss of life and/or property. b. Failure to award the contract after competitive public bidding for valid cause or causes . . . . c. Where the subject project is adjacent or contiguous to an ongoing project and it could be economically prosecuted by the same contractor provided that he has no negative slippage and has demonstrated a satisfactory performance. He contends, however, that the said provision does not contain the entire list of exceptions to public bidding recognized by P.D. No. 1594; that the rules limit the exceptions only to times of emergencies where lives or properties are endangered and to failure to award the contract after competitive public bidding; and that the rules do not elaborate on the other situations provided for by Section 4 of P.D. No. 1594, namely, where time is of the essence, or where there is a lack of qualified bidders, or where there is conclusive evidence that greater economy and efficiency would be achieved through negotiated contract. Petitioner urges that the yardstick for negotiating contracts is not confined solely to the Implementing Rules and Regulations, but also includes Section 4 of P.D. No. 1594. Further, he alleges that the detailed engineering plans prepared by a duly certified architect before entering into the said contracts and the other requirements, namely, the site, foundation, and soils investigation survey, were no longer needed because the constructions were merely extensions of existing buildings, as shown by a certification dated August 30, 1989 by the university architect and engineer.13 Reference is made to the General Instructions and Guidlines for the Implementation of LOI No. 1461, which provides that "5.d. Construction costing less than P2 Million may be approved by the State Colleges/Universities Board" and that pursuant thereto the approval of the PSU Board of Regents on February 16, 1987 was secured. It is also pointed out that COA Circular No. 83-101-J provides that the Heads of Ministries (now Departments) of non-infrastructure agencies can approve contracts up to P1 Million. In this case, the Secretary of Education, Culture and Sports approved the contracts.14 Petitioner disclaims responsibility for the spurious signatures on the approval of the contracts, and that as a matter of fact, said approval was not necessary for the validity of said contract as afore-discussed because all that was needed was the approval of the Secretary of Education, Culture and Sports. As the questioned contracts are valid for having complied with the requirements of negotiated contracts, petitioner contends that payments thereof should not have been disallowed by the respondent. Further granting for the sake of argument that the contracts were invalid, it is asserted that the payment should have

been allowed based on the principle of "quantum meruit" because the said buildings are now in existence and are being used by the university for its classes so that the government in effect benefited thereby. On the other hand, respondent alleges the said Advice of Allotment was officially released by the DBM in January, 1987,15 so there was no reason for petitioner to be apprehensive that the university will lose the money; and that the allotment, being for capital outlay, could not have been reverted to the unappropriated surplus of the general fund even if it were not obligated during the budget year 1986. Attention is called to P.D. No. 1177, otherwise known as the Budget Reform Decree of 1977, which provides: Sec. 33. Reversion of Unexpended Balances of Appropriations; Continuing Appropriation. –– Unexpended balances of appropriations authorized in the General Appropriations Act shall revert to the unappropriated surplus of the General Fund at the end of the fiscal year and shall not thereafter be available for expenditure except by subsequent legislative enactment: provided, that appropriations for, capital outlays shall remain valid until fully spent or reverted: provided, further, that continuing appropriations for current operating expenditures may be specifically recommended and approved as such in support of projects whose effective implementation calls for multi-year expenditure commitments; provided, finally, that the President may authorize the use of savings realized by an agency during a given year, to meet non-recurring expenditures in a subsequent year. (Emphasis supplied.)16 Respondent points out violations of mandatory requirements of law as the construction contracts were not entered into in accordance with Secton 4 of P.D. No. 1594 and its implementing rules and regulations. Respondent avers that (1) time is not of the essence as the fear that the allotment will revert to the unappropriated surplus of the general fund of the government is unfounded; (2) that petitioner did not comply with the requirements of negotiated contracts mandated by the rules; (3) that petitioner did not procure the negotiated contracts "through sealed canvass of at least three qualified contractors as required under the rules; (4) the petitioner did not secure the prior approval of the heads of the agency to negotiate the contracts; (5) that the procurement of the contracts was tainted by irregularities and bad faith as spurious documents were submitted for allowance in audit of the same; (6) that as the contracts were invalid and did not comply with the mandatory requirements of the rules, respondent did not abuse its discretion in disregarding the said contracts; and (7) that the principle of quantum meruit cannot be applied in the present case when there is a clear violation of law, rules and regulations as well as the use of spurious documents. After a careful review of the records, the Court finds that the ruling of the respondent Commission is not without cogent basis. It is not denied that petitioner failed to undertake a public bidding as required by the rules and regulations of contracts of this nature. The reason petitioner adduced thereby is that time constraints due to fear of losing the allocation which may revert to general fund compelled him to enter into the negotiated contracts with the contractor in order to complete the projects to respond to the increasing enrollment of the university. The only exception contemplated that would justify a negotiated contract under Section 4 of P.D. No. 1594 and the Implementing Rules and Regulations thereof (IB 10.4.2) is as above enumerated. The situation invoked by petitioner does not fall under any of the said conditions. And even assuming that it may be considered, that the situation falls within the exception, the rule still requires a bidding through sealed canvass of at least three (3) qualified contractors. Petitioner did not comply therewith. Spurious documents were introduced consisting of the falsified approval of the contracts by then Executive Secretary Joker P. Arroyo. Nevertheless, as the same was admittedly secured by the contractor, the petitioner cannot be imputed bad faith under these circumstances. However, as the amounts of the projects are less than P1 million each, only the approval of the Secretary of Education, Culture and Sports is required under COA Circular No. 83-1 01 J.17 Said approval was secured in this case. Likewise, petitioner was able to get the approval of the Board of Regents of said contracts on February 16, 1987 by virtue of its authority under Section 3(i) of P.D. No. 1437. The contract cost of both projects were below the agency estimates.

What clearly demonstrates the good faith of petitioner is that when he learned of the irregularity in securing the approval of the contracts by the Office of the President, he promptly suspended work on the project until further advise. The Court finds and so holds that petitioner entered into the two contracts in good faith for the good and interest of the university and the government.1âwphi1 As it is, the two projects are now 95% complete. The buildings are now being used by the university. On the basis of quantum meruit the contractor should be allowed to recover for the work accomplished. In Royal Trust Construction vs. COA,18 a case involving the widening and deepening of the Betis River in Pampanga at the urgent request of the local officials and with the knowledge and consent of the Ministry of Public Works, even without a written contract and the covering appropriation, the project was undertaken to prevent the overflowing of the neighboring areas and to irrigate the adjacent farmlands. The contractor sought compensation for the completed portion in the sum of over P1 million. While the payment was favorably recommended by the Ministry of Public Works, it was denied by the respondent COA on the ground of violation of mandatory legal provisions as the existence of corresponding appropriations covering the contract cost. Under COA Res. No. 36-58 dated November 15, 1986 its existing policy is to allow recovery from covering contracts on the basis of quantum meruit if there is delay in the accomplishment of the required certificate of availability of funds to support a contract. In said case, the Solicitor General agreed with the respondent COA but in the present case he agrees with petitioner. Thus, this Court held therein –– The work done by it was impliedly authorized and later expressly acknowledged by the Ministry of Public Works, which has twice recommended favorable action on the petitioner's request for payment. Despite the admitted absence of a specific covering appropriation as required under COA Resolution No. 36-58, the petitioner may nevertheless be compensated for the services rendered by it, concededly for the public benefit, from the general fund alloted by law to the Betis River project. Substantial compliance with the said resolution, in view of the circumstances of this case, should suffice. The Court also feels that the remedy suggested by the respondent, to wit, the filing of a complaint in court for recovery of the compensation claimed, would entail additional expense, inconvenience and delay which in fairness should not be imposed on the petitioner. Accordingly, in the interest of substantial justice and equity, the respondent Commission on Audit is DIRECTED to determine on a quantum meruit basis the total compensation due to the petitioner for the services rendered by it in the channel improvement of the Betis River in Pampanga and to allow the payment thereof immediately upon completion of the said determination. In the present case, the Court finds that the contractor should be duly compensated for services rendered, which were for the benefit of the general public. To deny the payment to the contractor of the two buildings which are almost fully completed and presently occupied by the university would be to allow the government to unjustly enrich itself at the expense of another. Justice and equity demand compensation on the basis of quantum meruit. WHEREFORE, the petition is GRANTED. The questioned decision of the respondent COA dated February 16, 1989 and its resolution dated August 2, 1989 are hereby REVERSED AND SET ASIDE. The respondent COA is directed to determine on a quantum meruit basis the total compensation due to the contractor for the completed portion of these two projects and to allow the payment thereof immediately upon the completion of said determination. No costs. SO ORDERED.

G.R. No. 92646-47 October 4, 1991

AUGUSTO TOLEDO, petitioner, vs. CIVIL SERVICE COMMISSION and COMMISSION ON ELECTIONS, respondents. Toledo & Toledo for petitioner. Itaas-Fetalino, Limare and Huerta for CSC.

PARAS, J.: Petitioner Atty. Augusto Toledo was appointed by then Comelec Chairman Ramon Felipe as Manager of the Education and Information Department of the Comelec, on May 21, 1986. At the time of his appointment, petitioner, having been born on July 8, 1927 was already more than fifty-seven (57) years old. It was the first time petitioner joined the government service as he was then engaged in active private practice prior to said appointment. Petitioner's appointment papers, particularly Civil Service Form No. 333 and his oath of office were endorsed by the Comelec to the Civil Service Commission (CSC, for brevity) on June 11, 1986, for approval and attestation. However, no prior request for exemption from the provisions of Section 22, Rule III of the Civil Service Rules on Personnel Action and Policies (CSRPAP, for brevity) was secured. Said provision prohibits the appointment of persons 57 years old or above into the government service without prior approval by the Civil Service Commission (CSC Memorandum Circular No. 5, Series of 1983). Petitioner officially reported for work and assumed the functions of his office on June 16, 1986. On January 29, 1989, public respondent Comelec, upon discovery of the lack of authority required under Section 22, Rule III of the CSRPAP, and CSC Memorandum Circular No. 5, Series of 1983 issued Resolution No. 2066, the pertinent portion of which is hereinbelow quoted, to wit: WHEREAS, for the validity then of the appointment of Atty. Toledo as Manager of the Education and Information Department it was necessary that not only must prior authority from the Civil Service Commission be obtained considering that he was more than fifty-seven (57) years old at the time, it must as well be shown that (a) the exigencies of the service so required, (b) Atty. Toledo possesses special qualification not possessed by other officers or employees in the Commission, and (c) the vacancy cannot be filled by promotion of qualified officers or employees in the Commission; WHEREAS, there is nothing in the 120 File of Atty. Toledo that indicates that such authority was even obtained from the Civil Service Commission or from the President of the Philippines; moreover, conditions (a), (b) and (c) stated in the immediately preceding clause did not then exist; WHEREAS, the appointment then of Atty. Toledo was made in violation of law and pursuant to Section 7, Rule III of the Civil Service Rules on Personnel Action, the appointment was void from the beginning. NOW, THEREFORE, be it resolved, as it is hereby resolved, to DECLARE as VOID from the beginning the appointment of Atty. Augusto Toledo as Manager of the Education and Information Department of this Commission. (pp. 49-50, Rollo) Petitioner appealed the foregoing Comelec Resolution No. 2066 to public respondent CSC on February 4, 1989. On July 12, 1989, public respondent CSC promulgated Resolution No. 89-468 which disposed of the appeal, thus:

WHEREFORE, foregoing premises considered, the Commission resolved to declare, as it hereby declares the appointment of Augusto V. Toledo as Manager, Information and Education Department, Commission on Elections, there being no basis in law, merely voidable and not void ab initio. Hence, Atty. Toledo is considered a de facto officer from the time he assumed office on June 16, 1986, until and up to the promulgation of COMELEC Resolution No. 2066 on January 29, 1989. (pp. 35-36, Rollo) Unable to obtain a reconsideration from the aforesaid Resolution, petitioner filed the present petition for certiorari. It is first contended by petitioner that CSC Resolution No. 89-468 is without legal basis because the CSRPAP is invalid and unenforceable for not having been published in the Official Gazette or in any newspaper of general circulation as required under Section 9(b) of P.D. 807. This being the case, petitioner argues that the requirement of prior CSC authority to appoint persons 57 years or older under Section 22, Rule III of the CSRPAP has not "become effective" and cannot be invoked against him. It will be recalled that the Civil Service Act of 1959 (Republic Act No. 2260) took effect on June 19, 1959. That act, among other things, established a Civil Service Commission one of the functions of which was, "with the approval by the President, to prescribe, amend, and enforce suitable rules and regulations for carrying into effect the provisions of ... the Civil Service Law," said rules "to become effective thirty days after publication in the Official Gazette" [Sec. 16 (e)]. The Commission subsequently adopted and promulgated rules intended to carry the law into effect, known as the Revised Civil Service Rules. Those rules were published in the supplement to Vol. 58, No. 49 of the Official Gazette, dated December 3, 1962. Section 5, Rule VI of those Revised Civil Service Rules provided that: SEC. 5. No person shall be appointed or reinstated in the service if he is already 57 years old, unless the President of the Philippines, President of the Senate, Speaker of the House of Representatives, or the Chief Justice of the Supreme Court, as the case may be, determines that he possesses special qualifications and his services are needed. It is worthy of note, however, that the statute itself (RA 2260) contained no provision prohibiting appointment or reinstatement in the Government service of any person who was already 57 years old, or otherwise requiring that some limitation as regards to age be placed on employment in the Government service. This prohibition was purely a creation of the Civil Service Commission. On October 6, 1975, pursuant to the 1973 Constitution, Presidential Decree No. 807 was issued by President Marcos, establishing "an independent Civil Service Commission." The decree, known as the "Civil Service Decree of the Philippines," repealed or accordingly modified all laws, rules, and regulations or parts thereof inconsistent" with its provisions (Sec. 59), although it declared that "the former Civil Service Commission created under Republic Act No. 2260, as amended, and as organized under the Integrated Reorganization Plan may serve as the nucleus of the Civil Service Commission" (Fourth Whereas Clause, Preamble). Like RA 2260 which it superseded, PD 807 empowered the Commission to "prescribe, amend, and enforce suitable rules and regulations for carrying into effect the provisions of the Decree," and also provided that said "rules and regulations shall become effective thirty (30) days after publication in the Official Gazette or in any newspaper of general circulation." The new Civil Service Commission adopted "rules and regulations for carrying into effect the provisions" of the Civil Service Decree on November 20, 1983. The rules were named, "Civil Service Rules on Personnel Actions and Policies" (CSRPAP). Section 22, Rule III of the CSRPAP is substantially the same as Section 5, Rule VI of the quondam "Revised Civil Service Rules" and it reads as follows:

SEC. 22. No person shall be appointed, reinstated, or re-employed in the service if he is already 57 years old, unless the President, or the Chief Justice of the Supreme Court, in the case of employees in the judiciary, determines that he possesses special qualifications urgently needed by the hiring agency. Omitted, it will be observed, was reference to the "President of the Senate" and the "Speaker of the House of Representatives," both of whom were expressly mentioned in the counterpart provision in the former rules (Section 5, Rule VI, supra). Noteworthy, too, is that there is no provision at all in PD 807 dealing in any manner with the appointment, reinstatement or re-employment in the Government service of any person already 57 years or any particular age, for that matter. Again, the provision regarding persons 57 years of age was purely a creation of the Commission, having no reference to any provision in the decree intended to be implemented. It was this provision of the CSRPAP (Sec. 22, Rule III) which was applied to Toledo. According to the CSC, since prior authority for Toledo's appointment had never been obtained — indeed, it would appear that the appointment papers were not transmitted by the COMELEC to the CSC until February, 1989 at which time Toledo's appointment was "approved as permanent" by the Executive Director of said CSC—the appointment had to be struck down. Now, these rules and regulations (CSRPAP) were never published either in the Official Gazette or any newspaper of general circulation, at least as of the time that Section 22, Rule III thereof was applied to Toledo to the latter's prejudice. As much was admitted by the Chairman of the Commission, Hon. Patricia A. Sto. Tomas in a letter written by her to Toledo dated February 2, 1989. In that letter, the Chairman stated that (a) the Commission had "no record of the publication of said Rules ("Rules on Personnel Actions and Policies") in newspapers of general circulation" although said Rules were "published and distributed by the National Media Production Center in 1975," and that (b) only "the Rule on Promotion embodied in CSC Resolution No. 83-343 repealing Rule V of the said Rules was published on August 15, 1983 in Volume 79 No. 33 of the Official Gazette" (Annex I, petition). The lack of publication is also attested by the Director of the National Printing Office who, in a Certification issued by him on January 30, 1989, stated that "the RULES ON PERSONNEL ACTIONS AND POLICIES' promulgated on November 20, 1975 by the Civil Service Commission implementing Presidential Decree No. 807 was not submitted to this office for publication" (Annex J, petition). The Revised Civil Service Rules implementing R.A. No. 2260 cannot be considered valid and effective after RA 2260 was repealed and superseded by PD 807. PD 807 was obviously intended to take the place of RA 2260. In all matters dealt with by both laws, the provisions of PD 807 were obviously intended to be controlling. So, also, the rules promulgated by the Civil Service Commission to carry the provisions of PD 807 into effect were meant to supersede or take the place of the rules implementing RA 2260. In other words, PD 807 and the CSRPAP were intended to make RA 2260 and its implementing rules functus officio, render them without force and effect except only as regards any provision, if at all, not dealt with by PD 807 or the CSRPAP. Now, it may reasonably be assumed that the law-making authority at the time, the President, was aware of the provision on 57-year old persons in the Revised Civil Service Rules promulgated under RA 2260. Yet when he promulgated PD 807 the President did not see fit to incorporate therein any provision regarding 57-year old persons or for that matter, to prescribe any age beyond which persons could become ineligible for appointment, reintatement or re-employment. This surely is an indication of an intention not to continue the provision in effect. In any event, the provision on 57-year old persons in the Revised Civil Service Rules (under said RA 2260) cannot be accorded validity. As already pointed out, it is entirely a creation of the Civil Service Commission, having no basis in the law itself which it was meant to implement. It cannot be related to or connected with any specific provision of the law which it is meant to carry into effect, such as a requirement, for instance, that age should be reckoned as a factor in the employment or reinstatement of an individual, or a direction that there be a determination of some point in a person's life at which he becomes unemployable, or employable only under specific conditions. It was therefore an unauthorized act of legislation on the part of the Civil Service Commission. It cannot be justified as a valid exercise of its function of promulgating rules and regulations for that function, to repeat, may legitimately be exercised only for the purpose of carrying the provisions of the law into effect; and since there is no prohibition or restriction on the employment of 57-year old persons in the

statute—or any provision respecting age as a factor in employment—there was nothing to carry into effect through an implementing rule on the matter. The power vested in the Civil Service Commission was to implement the law or put it into effect, not to add to it; to carry the law into effect or execution, not to supply perceived omissions in it. "By its administrative regulations, of course, the law itself can not be extended; said regulations 'cannot amend an act of Congress.' " (Teoxon v. Members of the Board of Administrators, Philippine Veterans Administration, 33 SCRA 585, 589 [1970], citing Santos v. Estenzo, 109 Phil. 419 [1960]; see also, Animos v. Philippine Veterans Affairs Office, 174 SCRA 214, 223-224 [1989] in turn citing Teoxon). The considerations just expounded also conduce to the conclusion of the invalidity of Section 22, Rule III of the CSRPAP. The enactment of said section, relative to 57-year old persons, was also an act of supererogation on the part of the Civil Service Commission since the rule has no relation to or connection with any provision of the law supposed to be carried into effect. The section was an addition to or extension of the law, not merely a mode of carrying it into effect. Apart from this, the CSRPAP cannot be considered effective as of the time of the application to Toledo of a provision thereof, for the reason that said rules were never published, as is admitted on all sides. The argument that the CSRPAP need not be published, because they were "a mere reiteration of existing law" and had been "circularized," flies in the teeth of the explicit and categorical requirement of PD 807 that rules and regulations for carrying into effect the provisions of the Decree shall become effective thirty (30) days after publication in the Official Gazette or in any newspaper of general circulation. Moreover, the CSRPAP cannot properly be considered a mere reiteration of existing law, for as already discussed, the implementing rule governing 57-year old persons is invalid and cannot in any sense be considered "existing law." Assuming without conceding that the rule regarding employment of 57-year old persons is valid and enforceable, it can only apply, according to its express terms, to employees under the supervision of the Chief Justice of the Supreme Court, or of the President of the Philippines, these two being the only officials mentioned as having to give consent to the employment of said persons. It cannot be construed as applying to employees over whom neither the President nor the Chief Justice exercises supervision, such as the Senate or the House of Representatives, or the COMELEC or other Constitutional Commissions. One last word. There is absolutely no question about the fact that the only reason for Toledo's separation from the service was the fact that he was already more than 57 years old when he was invited to work in the COMELEC by its former Chairman, but through no fault of his own, not all the conditions for his employment appear to have been satisfied. There is no question that it was not Toledo's fault that his papers were tardily submitted to the Civil Service Commission and approval of his appointment was made only by the Executive Director of the Commission and not by the Chairman thereof (to whom the function of the President of approving appointments like those of Toledo had been delegated under LOI 47, CSC Memo Circular No. 5, Series of 1983). There is no question, too, that he was actively engaged in law practice when taken into the COMELEC. There is absolutely no question about the fact that he was otherwise a competent and efficient officer of the COMELEC and had not given the remotest cause for dismissal. These are equitable considerations proscribing application to him of the provision in question, assuming its validity, or impelling at least a restrictive application thereof so that it may not work to his prejudice. Premises considered, the petition is hereby GRANTED. SO ORDERED.

G.R. No. L-26803 October 14, 1975 AMERICAN TOBACCO COMPANY, CARNATION COMPANY, CURTISS CANDY COMPANY, CUDAHY PACKING CO., CLUETT, PEABODY & CO., INC., CANNONMILLS COMPANY, FORMICA CORPORATION, GENERALMOTORS CORPORATION, INTERNATIONAL LATEX CORPORATION, KAYSER-ROTH CORPORATION, M and R DIETETIC LABORATORIES, INC., OLIN MATHIESON, PARFUM CIRO, INC.,

PROCTER and GAMBLE COMPANY, PROCTER and GAMBLE PHILIPPINE MANUFACTURING CORPORATION, PARFUMS PORVIL DENTRIFICES DU DOCTEUR PIERRE REUNIS SOCIETE ANONYME, R.J. REYNOLDS TOBACCO COMPANY, SWIFT AND COMPANY, STERLING PRODUCTS INTERNATIONAL, THE CLOROX COMPANY, WARNER LAMBERT PHARMACEUTICALS COMPANY and ZENITH RADIO CORPORATION, petitioners, vs. THE DIRECTOR OF PATENTS, ATTYS. AMANDO L. MARQUEZ, TEOFILO P. VELASCO, RUSTICO A. CASIA and HECTOR D. BUENALUZ, respondents. Lichauco, Picazo and Agcaoili for petitioners. Office of the Solicitor General for respondents.

ANTONIO, J.: In this petition for mandamus with preliminary injunction, petitioners challenge the validity of Rule 168 of the "Revised Rules of Practice before the Philippine Patent Office in Trademark Cases" as amended, authorizing the Director of Patents to designate any ranking official of said office to hear "inter partes" proceedings. Said Rule likewise provides that "all judgments determining the merits of the case shall be personally and directly prepared by the Director and signed by him." These proceedings refer to the hearing of opposition to the registration of a mark or trade name, interference proceeding instituted for the purpose of determining the question of priority of adoption and use of a trade-mark, trade name or service-mark, and cancellation of registration of a trade-mark or trade name pending at the Patent Office. Petitioners are parties, respectively, in the following opposition, interference and cancellation proceedings in said Office: Inter Partes Cases Nos. 157, 392, 896, 282, 247, 354, 246,332, 398, 325, 374, 175, 297, 256, 267, 111, 400, 324, 114, 159, 346, and 404. Under the Trade-mark Law (Republic Act No. 166 ), the Director of Patents is vested with jurisdiction over the above-mentioned cases. Likewise, the Rules of Practice in Trade-mark Cases contains a similar provision, thus: 168. Original jurisdiction over inter partes proceeding. — the Director of Patents shall have original jurisdiction over inter partes proceedings. In the event that the Patent Office should be provided with an Examiner of Interferences, this Examiner shall have the original jurisdiction over these cases, instead of the Director. In the case that the Examiner of Interferences takes over the original jurisdiction over inter partes proceedings, his final decision subject to appeal to the Director of Patents within three months of the receipt of notice of decisions. Such appeals shall be governed by sections 2, 3, 4, 6, 7, 8, 10, 11, 12, 13, 14, 15 and 22 of Rule 41 of the Rules of Court insofar as said sections are applicable and appropriate, and the appeal fee shall be P25.00. The Rules of Practice in Trade-mark Cases were drafted and promulgated by the Director of Patents and approved by the then Secretary of Agriculture and Commerce.. 1 Subsequently, the Director of Patents, with the approval of the Secretary of Agriculture and Commerce, amended the afore-quoted Rule 168 to read as follows: 168. Original Jurisdiction over inter partes proceedings. — The Director of Patents shall have original jurisdiction over inter partes proceedings, [In the event that the Patent Office is provided with an Examiner of Interferences, this Examiner shall then have the original jurisdiction over these cases, instead of the Director. In the case that the Examiner of Interferences takes over the original jurisdiction over inter partes proceedings, his final decisions shall be subject to

appeal to the Director of Patents within three months of the receipt of notice decision. Such appeals shall be governed by Sections 2, 3, 4, 6, 7, 8,10, 11, 12, 13, 14, 15, and 22 of Rule 41 of the Rules of Court insofar as said sections are applicable and appropriate, and the appeal fee shall be [P25.00.] Such inter partes proceedings in the Philippine Patent Office under this Title shall be heard before the Director of Patents, any hearing officer, or any ranking official designated by the Director, but all judgments determining the merits of the case shall be personally and directly prepared by the Director and signed by him. (Emphasis supplied.) In accordance with the amended Rule, the Director of Patents delegated the hearing of petitioners' cases to hearing officers, specifically, Attys. Amando Marquez, Teofilo Velasco, Rustico Casia and Hector Buenaluz, the other respondents herein. Petitioners filed their objections to the authority of the hearing officers to hear their cases, alleging that the amendment of the Rule is illegal and void because under the law the Director must personally hear and decide inter partes cases. Said objections were overruled by the Director of Patents, hence, the present petition for mandamus, to compel The Director of Patents to personally hear the cases of petitioners, in lieu of the hearing officers. It would take an extremely narrow reading of the powers of the Director of Patents under the general law2 and Republic Acts Nos. 1653 and 166 3 * to sustain the contention of petitioners. Under section 3 of RA 165, the Director of Patents is "empowered to obtain the assistance of technical, scientific or other qualified officers or employees of other departments, bureaus, offices, agencies and instrumentalities of the Government, including corporations owned, controlled or operated by the Government, when deemed necessary in the consideration of any matter submitted to the Office relative to the enforcement of the provisions" of said Act. Section 78 of the same Act also empowers "the Director, subject to the approval of the Department Head," to "promulgate the necessary rules and regulations, not inconsistent with law, for the conduct of all business in the Patent Office." The aforecited statutory authority undoubtedly also applies to the administration and enforcement of the Trade-mark Law (Republic Act No. 166). It has been held that power-conferred upon an administrative agency to which the administration of a statute is entrusted to issue such regulations and orders as may be deemed necessary or proper in order to carry out its purposes and provisions maybe an adequate source of authority to delegate a particular function, unless by express provisions of the Act or by implication it has been withheld.4 There is no provision either in Republic Act No. 165 or 166 negativing the existence of such authority, so far as the designation of hearing examiners is concerned. Nor can the absence of such authority be fairly inferred from contemporaneous and consistent Executive interpretation of the Act. The nature of the power and authority entrusted to The Director of Patents suggests that the aforecited laws (Republic Act No. 166, in relation to Republic Act No. 165) should be construed so as to give the aforesaid official the administrative flexibility necessary for the prompt and expeditious discharge of his duties in the administration of said laws. As such officer, he is required, among others, to determine the question of priority in patent interference proceedings,5 decide applications for reinstatement of a lapsed patent,6 cancellations of patents under Republic Act No. 165,7 inter partes proceedings such as oppositions,8 claims of interference, 9 cancellation cases under the Trade-mark Law 10and other matters in connection with the enforcement of the aforesaid laws. It could hardly be expected, in view of the magnitude of his responsibility, to require him to hear personally each and every case pending in his Office. This would leave him little time to attend to his other duties. 11 For him to do so and at the same time attend personally to the discharge of every other duty or responsibility imposed upon his Office by law would not further the development of orderly and responsible administration. The reduction of existing delays in regulating agencies requires the elimination of needless work at top levels. Unnecessary and unimportant details often occupy far too much of the time and energy of the heads of these agencies and prevent full and expeditious consideration of the more important issues. the remedy is a far wider range of delegations to subordinate officers. This sub-delegation of power has been justified by "sound principles of organization" which demand that "those at the top be able to concentrate their attention upon the larger and more important questions of policy and practice, and their time be freed, so far as possible, from the consideration of the smaller and far less important matters of detail." 12

Thus, it is well-settled that while the power to decide resides solely in the administrative agency vested by law, this does not preclude a delegation of the power to hold a hearing on the basis of which the decision of the administrative agency will be made. 13 The rule that requires an administrative officer to exercise his own judgment and discretion does not preclude him from utilizing, as a matter of practical administrative procedure, the aid of subordinates to investigate and report to him the facts, on the basis of which the officer makes his decisions. 14 It is sufficient that the judgment and discretion finally exercised are those of the officer authorized by law. Neither does due process of law nor the requirements of fair hearing require that the actual taking of testimony be before the same officer who will make the decision in the case. As long as a party is not deprived of his right to present his own case and submit evidence in support thereof, and the decision is supported by the evidence in the record, there is no question that the requirements of due process and fair trial are fully met. 15 In short, there is no abnegation of responsibility on the part of the officer concerned as the actual decision remains with and is made by said officer. 16 It is, however, required that to "give the substance of a hearing, which is for the purpose of making determinations upon evidence the officer who makes the determinations must consider and appraise the evidence which justifies them." 17 In the case at bar, while the hearing officer may make preliminary rulings on the myriad of questions raised at the hearings of these cases, the ultimate decision on the merits of all the issues and questions involved is left to the Director of Patents. Apart from the circumstance that the point involved is procedural and not jurisdictional, petitioners have not shown in what manner they have been prejudiced by the proceedings. Moreover, as the Solicitor General Antonio P. Barredo, now a Member of this Court has correctly pointed out, the repeated appropriations by Congress for hearing officers of the Philippine Patent Office form 1963 to 1968 18 not only confirms the departmental construction of the statute, but also constitutes a ratification of the act of the Director of Patents and the Department Head as agents of Congress in the administration of the law. 19 WHEREFORE, the instant petition is hereby dismissed, with costs against petitioners. G.R. No. 84818 December 18, 1989 PHILIPPINE COMMUNICATIONS SATELLITE CORPORATION, petitioner, vs. JOSE LUIS A. ALCUAZ, as NTC Commissioner, and NATIONAL TELECOMMUNICATIONS COMMISSION, respondents. REGALADO, J.: This case is posed as one of first impression in the sense that it involves the public utility services of the petitioner Philippine Communications Satellite Corporation (PHILCOMSAT, for short) which is the only one rendering such services in the Philippines. The petition before us seeks to annul and set aside an Order 1 issued by respondent Commissioner Jose Luis Alcuaz of the National Telecommunications Commission (hereafter, NTC), dated September 2, 1988, which directs the provisional reduction of the rates which may be charged by petitioner for certain specified lines of its services by fifteen percent (15%) with the reservation to make further reductions later, for being violative of the constitutional prohibition against undue delegation of legislative power and a denial of procedural, as well as substantive, due process of law. The antecedental facts as summarized by petitioner 2 are not in dispute. By virtue of Republic Act No. 5514, PHILCOMSAT was granted "a franchise to establish, construct, maintain and operate in the Philippines, at such places as the grantee may select, station or stations and associated equipment and facilities for international satellite communications." Under this franchise, it was likewise granted the authority to "construct and operate such ground facilities as needed to deliver telecommunications services from the communications satellite system and ground terminal or terminals."

Pursuant to said franchise, petitioner puts on record that it undertook the following activities and established the following installations: 1. In 1967, PHILCOMSAT established its provisional earth station in Pinugay, Rizal. 2. In 1968, earth station standard "A" antenna (Pinugay I) was established. Pinugay I provided direct satellite communication links with the Pacific Ocean Region (the United States, Australia, Canada, Hawaii, Guam, Korea, Thailand, China [PROC], New Zealand and Brunei) thru the Pacific Ocean INTELSAT satellite. 3. In 1971, a second earth station standard "A" antenna(Pinugay III) was established. Pinugay II provided links with the Indian Ocean Region (major cities in Europe, Middle East, Africa, and other Asia Pacific countries operating within the region) thru the Indian Ocean INTELSAT satellite. 4. In 1983, a third earth station standard "B" antenna (Pinugay III) was established to temporarily assume the functions of Pinugay I and then Pinugay II while they were being refurbished. Pinugay III now serves as spare or reserved antenna for possible contingencies. 5. In 1983, PHILCOMSAT constructed and installed a standard "B" antenna at Clark Air Field, Pampanga as a television receive-only earth station which provides the U.S. Military bases with a 24-hour television service. 6. In 1989, petitioner completed the installation of a third standard "A" earth station (Pinugay IV) to take over the links in Pinugay I due to obsolescence. 3 By designation of the Republic of the Philippines, the petitioner is also the sole signatory for the Philippines in the Agreement and the Operating Agreement relating to the International Telecommunications Satellite Organization (INTELSAT) of 115 member nations, as well as in the Convention and the Operating Agreement of the International Maritime Satellite Organization (INMARSAT) of 53 member nations, which two global commercial telecommunications satellite corporations were collectively established by various states in line with the principles set forth in Resolution 1721 (XVI) of the General Assembly of the United Nations. Since 1968, the petitioner has been leasing its satellite circuits to: 1. Philippine Long Distance Telephone Company; 2. Philippine Global Communications, Inc.; 3. Eastern Telecommunications Phils., Inc.; 4. Globe Mackay Cable and Radio Corp. ITT; and 5. Capitol Wireless, Inc. or their predecessors-in-interest. The satellite services thus provided by petitioner enable said international carriers to serve the public with indispensable communication services, such as overseas telephone, telex, facsimile, telegrams, high speed data, live television in full color, and television standard conversion from European to American or vice versa. Under Section 5 of Republic Act No. 5514, petitioner was exempt from the jurisdiction of the then Public Service Commission, now respondent NTC. However, pursuant to Executive Order No. 196 issued on June 17, 1987, petitioner was placed under the jurisdiction, control and regulation of respondent NTC, including all its facilities and services and the fixing of rates. Implementing said Executive Order No. 196, respondents

required petitioner to apply for the requisite certificate of public convenience and necessity covering its facilities and the services it renders, as well as the corresponding authority to charge rates therefor. Consequently, under date of September 9, 1987, petitioner filed with respondent NTC an application 4 for authority to continue operating and maintaining the same facilities it has been continuously operating and maintaining since 1967, to continue providing the international satellite communications services it has likewise been providing since 1967, and to charge the current rates applied for in rendering such services. Pending hearing, it also applied for a provisional authority so that it can continue to operate and maintain the above mentioned facilities, provide the services and charge therefor the aforesaid rates therein applied for. On September 16, 1987, petitioner was granted a provisional authority to continue operating its existing facilities, to render the services it was then offering, and to charge the rates it was then charging. This authority was valid for six (6) months from the date of said order. 5 When said provisional authority expired on March 17, 1988, it was extended for another six (6) months, or up to September 16, 1988. The NTC order now in controversy had further extended the provisional authority of the petitioner for another six (6) months, counted from September 16, 1988, but it directed the petitioner to charge modified reduced rates through a reduction of fifteen percent (15%) on the present authorized rates. Respondent Commissioner ordered said reduction on the following ground: The Commission in its on-going review of present service rates takes note that after an initial evaluation by the Rates Regulation Division of the Common Carriers Authorization Department of the financial statements of applicant, there is merit in a REDUCTION in some of applicant's rates, subject to further reductions, should the Commission finds (sic) in its further evaluation that more reduction should be effected either on the basis of a provisional authorization or in the final consideration of the case. 6 PHILCOMSAT assails the above-quoted order for the following reasons: 1. The enabling act (Executive Order No. 546) of respondent NTC empowering it to fix rates for public service communications does not provide the necessary standards constitutionally required, hence there is an undue delegation of legislative power, particularly the adjudicatory powers of NTC; 2. Assuming arguendo that the rate-fixing power was properly and constitutionally conferred, the same was exercised in an unconstitutional manner, hence it is ultra vires, in that (a) the questioned order violates procedural due process for having been issued without prior notice and hearing; and (b) the rate reduction it imposes is unjust, unreasonable and confiscatory, thus constitutive of a violation of substantive due process. I. Petitioner asseverates that nowhere in the provisions of Executive Order No. 546, providing for the creation of respondent NTC and granting its rate-fixing powers, nor of Executive Order No. 196, placing petitioner under the jurisdiction of respondent NTC, can it be inferred that respondent NTC is guided by any standard in the exercise of its rate-fixing and adjudicatory powers. While petitioner in its petition-in-chief raised the issue of undue delegation of legislative power, it subsequently clarified its said submission to mean that the order mandating a reduction of certain rates is undue delegation not of legislative but of quasi-judicial power to respondent NTC, the exercise of which allegedly requires an express conferment by the legislative body. Whichever way it is presented, petitioner is in effect questioning the constitutionality of Executive Orders Nos. 546 and 196 on the ground that the same do not fix a standard for the exercise of the power therein conferred. We hold otherwise. Fundamental is the rule that delegation of legislative power may be sustained only upon the ground that some standard for its exercise is provided and that the legislature in making the delegation has prescribed the manner of the exercise of the delegated power. Therefore, when the administrative agency concerned, respondent NTC in this case, establishes a rate, its act must both be non- confiscatory and must have been

established in the manner prescribed by the legislature; otherwise, in the absence of a fixed standard, the delegation of power becomes unconstitutional. In case of a delegation of rate-fixing power, the only standard which the legislature is required to prescribe for the guidance of the administrative authority is that the rate be reasonable and just. However, it has been held that even in the absence of an express requirement as to reasonableness, this standard may be implied. 7 It becomes important then to ascertain the nature of the power delegated to respondent NTC and the manner required by the statute for the lawful exercise thereof. Pursuant to Executive Orders Nos. 546 and 196, respondent NTC is empowered, among others, to determine and prescribe rates pertinent to the operation of public service communications which necessarily include the power to promulgate rules and regulations in connection therewith. And, under Section 15(g) of Executive Order No. 546, respondent NTC should be guided by the requirements of public safety, public interest and reasonable feasibility of maintaining effective competition of private entities in communications and broadcasting facilities. Likewise, in Section 6(d) thereof, which provides for the creation of the Ministry of Transportation and Communications with control and supervision over respondent NTC, it is specifically provided that the national economic viability of the entire network or components of the communications systems contemplated therein should be maintained at reasonable rates. We need not go into an in-depth analysis of the pertinent provisions of the law in order to conclude that respondent NTC, in the exercise of its rate-fixing power, is limited by the requirements of public safety, public interest, reasonable feasibility and reasonable rates, which conjointly more than satisfy the requirements of a valid delegation of legislative power. II. On another tack, petitioner submits that the questioned order violates procedural due process because it was issued motu proprio, without notice to petitioner and without the benefit of a hearing. Petitioner laments that said order was based merely on an "initial evaluation," which is a unilateral evaluation, but had petitioner been given an opportunity to present its side before the order in question was issued, the confiscatory nature of the rate reduction and the consequent deterioration of the public service could have been shown and demonstrated to respondents. Petitioner argues that the function involved in the rate fixing-power of NTC is adjudicatory and hence quasi-judicial, not quasi- legislative; thus, notice and hearing are necessary and the absence thereof results in a violation of due process. Respondents admit that the application of a policy like the fixing of rates as exercised by administrative bodies is quasi-judicial rather than quasi-legislative: that where the function of the administrative agency is legislative, notice and hearing are not required, but where an order applies to a named person, as in the instant case, the function involved is adjudicatory. 8 Nonetheless, they insist that under the facts obtaining the order in question need not be preceded by a hearing, not because it was issued pursuant to respondent NTC's legislative function but because the assailed order is merely interlocutory, it being an incident in the ongoing proceedings on petitioner's application for a certificate of public convenience; and that petitioner is not the only primary source of data or information since respondent is currently engaged in a continuing review of the rates charged. We find merit in petitioner's contention. In Vigan Electric Light Co., Inc. vs. Public Service Commission,9 we made a categorical classification as to when the rate-filing power of administrative bodies is quasi-judicial and when it is legislative, thus: Moreover, although the rule-making power and even the power to fix rates- when such rules and/or rates are meant to apply to all enterprises of a given kind throughout the Philippines-may partake of a legislative character, such is not the nature of the order complained of. Indeed, the same applies exclusively to petitioner herein. What is more, it is predicated upon the finding of fact-based upon a report submitted by the General Auditing Office-that petitioner is making a profit of more than 12% of its invested capital, which is denied by petitioner. Obviously, the latter is entitled to cross-examine the maker of said report, and to introduce evidence to disprove the contents thereof and/or explain or complement the same, as well as to refute the conclusion drawn therefrom by the respondent. In other words, in making said finding of fact, respondent performed a function partaking of a quasi-judicial character, the valid exercise of which demands previous notice and hearing.

This rule was further explained in the subsequent case of The Central Bank of the Philippines vs. Cloribel, et al. 10 to wit: It is also clear from the authorities that where the function of the administrative body is legislative, notice of hearing is not required by due process of law (See Oppenheimer, Administrative Law, 2 Md. L.R. 185, 204, supra, where it is said: 'If the nature of the administrative agency is essentially legislative, the requirements of notice and hearing are not necessary. The validity of a rule of future action which affects a group, if vested rights of liberty or property are not involved, is not determined according to the same rules which apply in the case of the direct application of a policy to a specific individual) ... It is said in 73 C.J.S. Public Administrative Bodies and Procedure, sec. 130, pages 452 and 453: 'Aside from statute, the necessity of notice and hearing in an administrative proceeding depends on the character of the proceeding and the circumstances involved. In so far as generalization is possible in view of the great variety of administrative proceedings, it may be stated as a general rule that notice and hearing are not essential to the validity of administrative action where the administrative body acts in the exercise of executive, administrative, or legislative functions; but where a public administrative body acts in a judicial or quasi-judicial matter, and its acts are particular and immediate rather than general and prospective, the person whose rights or property may be affected by the action is entitled to notice and hearing. 11 The order in question which was issued by respondent Alcuaz no doubt contains all the attributes of a quasijudicial adjudication. Foremost is the fact that said order pertains exclusively to petitioner and to no other. Further, it is premised on a finding of fact, although patently superficial, that there is merit in a reduction of some of the rates charged- based on an initial evaluation of petitioner's financial statements-without affording petitioner the benefit of an explanation as to what particular aspect or aspects of the financial statements warranted a corresponding rate reduction. No rationalization was offered nor were the attending contingencies, if any, discussed, which prompted respondents to impose as much as a fifteen percent (15%) rate reduction. It is not far-fetched to assume that petitioner could be in a better position to rationalize its rates vis-a-vis the viability of its business requirements. The rates it charges result from an exhaustive and detailed study it conducts of the multi-faceted intricacies attendant to a public service undertaking of such nature and magnitude. We are, therefore, inclined to lend greater credence to petitioner's ratiocination that an immediate reduction in its rates would adversely affect its operations and the quality of its service to the public considering the maintenance requirements, the projects it still has to undertake and the financial outlay involved. Notably, petitioner was not even afforded the opportunity to cross-examine the inspector who issued the report on which respondent NTC based its questioned order. At any rate, there remains the categorical admission made by respondent NTC that the questioned order was issued pursuant to its quasi-judicial functions. It, however, insists that notice and hearing are not necessary since the assailed order is merely incidental to the entire proceedings and, therefore, temporary in nature. This postulate is bereft of merit. While respondents may fix a temporary rate pending final determination of the application of petitioner, such rate-fixing order, temporary though it may be, is not exempt from the statutory procedural requirements of notice and hearing, as well as the requirement of reasonableness. Assuming that such power is vested in NTC, it may not exercise the same in an arbitrary and confiscatory manner. Categorizing such an order as temporary in nature does not perforce entail the applicability of a different rule of statutory procedure than would otherwise be applied to any other order on the same matter unless otherwise provided by the applicable law. In the case at bar, the applicable statutory provision is Section 16(c) of the Public Service Act which provides: Section 16. Proceedings of the Commission, upon notice and hearing the Commission shall have power, upon proper notice and hearing in accordance with the rules and provisions of this Act, subject to the limitations and exceptions mentioned and saving provisions to the contrary: xxx xxx xxx

(c) To fix and determine individual or joint rates, ... which shall be imposed, observed and followed thereafter by any public service; ... There is no reason to assume that the aforesaid provision does not apply to respondent NTC, there being no limiting, excepting, or saving provisions to the contrary in Executive Orders Nos. 546 and 196. It is thus clear that with regard to rate-fixing, respondent has no authority to make such order without first giving petitioner a hearing, whether the order be temporary or permanent, and it is immaterial whether the same is made upon a complaint, a summary investigation, or upon the commission's own motion as in the present case. That such a hearing is required is evident in respondents' order of September 16, 1987 in NTC Case No. 87-94 which granted PHILCOMSAT a provisional authority "to continue operating its existing facilities, to render the services it presently offers, and to charge the rates as reduced by them "under the condition that "(s)ubject to hearing and the final consideration of the merit of this application, the Commission may modify, revise or amend the rates ..." 12 While it may be true that for purposes of rate-fixing respondents may have other sources of information or data, still, since a hearing is essential, respondent NTC should act solely on the basis of the evidence before it and not on knowledge or information otherwise acquired by it but which is not offered in evidence or, even if so adduced, petitioner was given no opportunity to controvert. Again, the order requires the new reduced rates to be made effective on a specified date. It becomes a final legislative act as to the period during which it has to remain in force pending the final determination of the case. 13An order of respondent NTC prescribing reduced rates, even for a temporary period, could be unjust, unreasonable or even confiscatory, especially if the rates are unreasonably low, since the utility permanently loses its just revenue during the prescribed period. In fact, such order is in effect final insofar as the revenue during the period covered by the order is concerned. Upon a showing, therefore, that the order requiring a reduced rate is confiscatory, and will unduly deprive petitioner of a reasonable return upon its property, a declaration of its nullity becomes inductible, which brings us to the issue on substantive due process. III. Petitioner contends that the rate reduction is confiscatory in that its implementation would virtually result in a cessation of its operations and eventual closure of business. On the other hand, respondents assert that since petitioner is operating its communications satellite facilities through a legislative franchise, as such grantee it has no vested right therein. What it has is merely a privilege or license which may be revoked at will by the State at any time without necessarily violating any vested property right of herein petitioner. While petitioner concedes this thesis of respondent, it counters that the withdrawal of such privilege should nevertheless be neither whimsical nor arbitrary, but it must be fair and reasonable. There is no question that petitioner is a mere grantee of a legislative franchise which is subject to amendment, alteration, or repeal by Congress when the common good so requires. 14 Apparently, therefore, such grant cannot be unilaterally revoked absent a showing that the termination of the operation of said utility is required by the common good. The rule is that the power of the State to regulate the conduct and business of public utilities is limited by the consideration that it is not the owner of the property of the utility, or clothed with the general power of management incident to ownership, since the private right of ownership to such property remains and is not to be destroyed by the regulatory power. The power to regulate is not the power to destroy useful and harmless enterprises, but is the power to protect, foster, promote, preserve, and control with due regard for the interest, first and foremost, of the public, then of the utility and of its patrons. Any regulation, therefore, which operates as an effective confiscation of private property or constitutes an arbitrary or unreasonable infringement of property rights is void, because it is repugnant to the constitutional guaranties of due process and equal protection of the laws. 15 Hence, the inherent power and authority of the State, or its authorized agent, to regulate the rates charged by public utilities should be subject always to the requirement that the rates so fixed shall be reasonable and just. A commission has no power to fix rates which are unreasonable or to regulate them arbitrarily. This basic

requirement of reasonableness comprehends such rates which must not be so low as to be confiscatory, or too high as to be oppressive. 16 What is a just and reasonable rate is not a question of formula but of sound business judgment based upon the evidence 17 it is a question of fact calling for the exercise of discretion, good sense, and a fair, enlightened and independent judgment. 18 In determining whether a rate is confiscatory, it is essential also to consider the given situation, requirements and opportunities of the utility. A method often employed in determining reasonableness is the fair return upon the value of the property to the public utility. Competition is also a very important factor in determining the reasonableness of rates since a carrier is allowed to make such rates as are necessary to meet competition. 19 A cursory perusal of the assailed order reveals that the rate reduction is solely and primarily based on the initial evaluation made on the financial statements of petitioner, contrary to respondent NTC's allegation that it has several other sources of information without, however, divulging such sources. Furthermore, it did not as much as make an attempt to elaborate on how it arrived at the prescribed rates. It just perfunctorily declared that based on the financial statements, there is merit for a rate reduction without any elucidation on what implications and conclusions were necessarily inferred by it from said statements. Nor did it deign to explain how the data reflected in the financial statements influenced its decision to impose a rate reduction. On the other hand, petitioner may likely suffer a severe drawback, with the consequent detriment to the public service, should the order of respondent NTC turn out to be unreasonable and improvident. The business in which petitioner is engaged is unique in that its machinery and equipment have always to be taken in relation to the equipment on the other end of the transmission arrangement. Any lack, aging, acquisition, rehabilitation, or refurbishment of machinery and equipment necessarily entails a major adjustment or innovation on the business of petitioner. As pointed out by petitioner, any change in the sending end abroad has to be matched with the corresponding change in the receiving end in the Philippines. Conversely, any in the receiving end abroad has to be matched with the corresponding change in the sending end in the Philippines. An inability on the part of petitioner to meet the variegations demanded be technology could result in a deterioration or total failure of the service of satellite communications. At present, petitioner is engaged in several projects aimed at refurbishing, rehabilitating, and renewing its machinery and equipment in order to keep up with the continuing charges of the times and to maintain its facilities at a competitive level with the technological advances abroad. There projected undertakings were formulated on the premise that rates are maintained at their present or at reasonable levels. Hence, an undue reduction thereof may practically lead to a cessation of its business. While we concede the primacy of the public interest in an adequate and efficient service, the same is not necessarily to be equated with reduced rates. Reasonableness in the rates assumes that the same is fair to both the public utility and the consumer. Consequently, we hold that the challenged order, particularly on the issue of rates provided therein, being violative of the due process clause is void and should be nullified. Respondents should now proceed, as they should heretofore have done, with the hearing and determination of petitioner's pending application for a certificate of public convenience and necessity and in which proceeding the subject of rates involved in the present controversy, as well as other matter involved in said application, be duly adjudicated with reasonable dispatch and with due observance of our pronouncements herein. WHEREFORE, the writ prayed for is GRANTED and the order of respondents, dated September 2, 1988, in NTC Case No. 87-94 is hereby SET ASIDE. The temporary restraining order issued under our resolution of September 13, 1988, as specifically directed against the aforesaid order of respondents on the matter of existing rates on petitioner's present authorized services, is hereby made permanent. SO ORDERED. G.R. No. 73140 May 29, 1987 RIZAL EMPIRE INSURANCE GROUP AND/OR SERGIO CORPUS, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, TEODORICO L. RUIZ, as Labor Arbiter and ROGELIO R. CORIA, respondents.

PARAS, J.: This is a petition for review on certiorari of the March 14, 1985 Decision of Labor Arbiter Teodorico L. Ruiz which held that herein private respondent Rogelio R. Coria was illegally dismissed; and of the Resolution of the National Labor Relations Commission which dismissed petitioner's appeal on the ground that the same was filed out of time. In August, 1977, herein private respondent Rogelio R. Coria was hired by herein petitioner Rizal Empire Insurance Group as a casual employee with a salary of P10.00 a day. On January 1, 1978, he was made a regular employee, having been appointed as clerk-typist, with a monthly salary of P300.00. Being a permanent employee, he was furnished a copy of petitioner company's "General Information, Office Behavior and Other Rules and Regulations." In the same year, without change in his position-designation, he was transferred to the Claims Department and his salary was increased to P450,00 a month. In 1980, he was transferred to the Underwriting Department and his salary was increased to P580.00 a month plus cost of living allowance, until he was transferred to the Fire Department as filing clerk. In July, 1983, he was made an inspector of the Fire Division with a monthly salary of P685.00 plus allowances and other benefits. On October 15, 1983, private respondent Rogelio R. Coria was dismissed from work, allegedly, on the grounds of tardiness and unexcused absences. Accordingly, he filed a complaint with the Ministry of Labor and Employment (MOLE), and in a Decision dated March 14, 1985 (Record, pp. 80-87), Labor Arbiter Teodorico L. Ruiz reinstated him to his position with back wages. Petitioner filed an appeal with the National labor Relations Commission (NLRC) but, in a Resolution dated November 15, 1985 (Ibid, pp. 31-32), the appeal was dismissed on the ground that the same had been filed out of time. Hence, the instant petition (Ibid, pp. 2-22). In compliance with the resolution of the Second Division of this Court dated April 30, 1986 (Ibid., p. 94), private respondent filed his Comment on May 23, 1986 (Ibid., pp. 97-101) and public respondent on July 2, 1986 (Ibid., pp. 120-124). On June 6, 1986, petitioners filed their Reply to private respondent's Comment (Ibid, pp. 102-105) and on July 25, 1986, their Reply to public respondent's Comment (Ibid., pp. 126-131). In a Resolution dated August 18, 1986, the Second Division of this Court resolved to give due course to the petition and to require the parties to submit their respective memoranda (Ibid., P. 132). In compliance with the above mentioned Resolution, petitioners filed the,.r memorandum on November 10, 1986; while private respondent filed his Memorandum on October 17, 1986 (Ibid, pp. 139-144), and public respondent on November 16, 1986 (Ibid., pp. 160-166). Before going however, into the merits of the case, an important point to consider is whether or not it is still within the jurisdiction of this Court to review. Rule VIII of the Revised Rules of the National Labor Relations Commission on appeal, provides: SECTION 1. (a) Appeal. — Decision or orders of a labor Arbiter shall be final and executory unless appealed to the Commission by any or both of the parties within ten (10) calendar days from receipt of notice thereof. xxx xxx xxx SECTION 6. No extension of period. — No motion or request for extension of the period within which to perfect an appeal shall be entertained. The record shows that the employer (petitioner herein) received a copy of the decision of the Labor Arbiter on April 1, 1985. It filed a Motion for Extension of Time to File Memorandum of Appeal on April 11, 1985 and filed the Memorandum of Appeal on April 22, 1985. Pursuant to the "no extension policy" of the National Labor

Relations Commission, aforesaid motion for extension of time was denied in its resolution dated November 15, 1985 and the appeal was dismissed for having been filed out of time (Rollo, pp. 31-32). Petitioners claim, among other things, that respondent Commission committed a grave abuse of discretion amounting to lack of jurisdiction in arbitrarily dismissing petitioners' appeal on a technicality (Rollo, p. 9). It invokes the Rules of Court provision on liberal construction of the Rules in the interest of substantial justice. It will be noted however, that the foregoing provision refers to the Rules of Court. On the other hand, the Revised Rules of the National Labor Relations Commission are clear and explicit and leave no room for interpretation. Moreover, it is an elementary rule in administrative law that administrative regulations and policies enacted by administrative bodies to interpret the law which they are entrusted to enforce, have the force of law, and are entitled to great respect (Espanol v. Philippine Veterans Administration, 137 SCRA 314 [1985]). Under the above-quoted provisions of the Revised NLRC Rules, the decision appealed from in this case has become final and executory and can no longer be subject to appeal. Even on the merits, the ruling of the Labor Arbiter appears to be correct; the consistent promotions in rank and salary of the private respondent indicate he must have been a highly efficient worker, who should be retained despite occasional lapses in punctuality and attendance. Perfection cannot after all be demanded. WHEREFORE, this petition is DISMISSED. SO ORDERED.

G.R. No. L-23004

June 30, 1965

MAKATI STOCK EXCHANGE, INC., petitioner, vs. SECURITIES AND EXCHANGE COMMISSION and MANILA STOCK EXCHANGE, respondents. BENGZON, C.J.: This is a review of the resolution of the Securities and Exchange Commission which would deny the Makati Stock Exchange, Inc., permission to operate a stock exchange unless it agreed not to list for trading on its board, securities already listed in the Manila Stock Exchange. Objecting to the requirement, Makati Stock Exchange, Inc. contends that the Commission has no power to impose it and that, anyway, it is illegal, discriminatory and unjust. Under the law, no stock exchange may do business in the Philippines unless it is previously registered with the Commission by filing a statement containing the information described in Sec. 17 of the Securities Act (Commonwealth Act 83, as amended). It is assumed that the Commission may permit registration if the section is complied with; if not, it may refuse. And there is now no question that the section has been complied with, or would be complied with, except that the Makati Stock Exchange, upon challenging this particular requirement of the Commission (rule against double listing) may be deemed to have shown inability or refusal to abide by its rules, and thereby to have given ground for denying registration. [Sec. 17 (a) (1) and (d)]. Such rule provides: "... nor shall a security already listed in any securities exchange be listed anew in any other securities exchange ... ."

The objection of Makati Stock Exchange, Inc., to this rule is understandable. There is actually only one securities exchange — The Manila Stock Exchange — that has been operating alone for the past 25 years; and all — or presumably all — available or worthwhile securities for trading in the market are now listed there. In effect, the Commission permits the Makati Stock Exchange, Inc., to deal only with other securities. Which is tantamount to permitting a store to open provided it sells only those goods not sold in other stores. And if there's only one existing store, 1 the result is a monopoly. It is not farfetched to assert — as petitioner does 2 that for all practical purposes, the Commission's order or resolution would make it impossible for the Makati Stock Exchange to operate. So, its "permission" amounted to a "prohibition." Apparently, the Commission acted "in the public interest." 3 Hence, it is pertinent to inquire whether the Commission may "in the public interest" prohibit (or make impossible) the establishment of another stock exchange (besides the Manila Stock Exchange), on the ground that the operation of two or more exchanges adversely affects the public interest. At first glance, the answer should be in the negative, because the law itself contemplated, and, therefore, tacitly permitted or tolerated at least, the operation of two or more exchanges. Wherever two or more exchanges exist, the Commission, by order, shall require and enforce uniformity of trading regulations in and/or between said exchanges. [Emphasis Ours] (Sec. 28b-13, Securities Act.) In fact, as admitted by respondents, there were five stock exchanges in Manila, before the Pacific War (p. 10, brief), when the Securities Act was approved or amended. (Respondent Commission even admits that dual listing was practiced then.) So if the existence of more than one exchange were contrary to public interest, it is strange that the Congress having from time to time enacted legislation amending the Securities Act, 4 has not barred multiplicity of exchanges. Forgetting for the moment the monopolistic aspect of the Commission's resolution, let us examine the authority of the Commission to promulgate and implement the rule in question. It is fundamental that an administrative officer has only such powers as are expressly granted to him by the statute, and those necessarily implied in the exercise thereof. In its brief and its resolution now subject to review, the Commission cites no provision expressly supporting its rule. Nevertheless, it suggests that the power is "necessary for the execution of the functions vested in it"; but it makes no explanation, perhaps relying on the reasons advanced in support of its position that trading of the same securities in two or more stock exchanges, fails to give protection to the investors, besides contravening public interest. (Of this, we shall treat later) . On the legality of its rule, the Commission's argument is that: (a) it was approved by the Department Head — before the War; and (b) it is not in conflict with the provisions of the Securities Act. In our opinion, the approval of the Department, 5 by itself, adds no weight in a judicial litigation; and the test is not whether the Act forbids the Commission from imposing a prohibition, but whether it empowers the Commission to prohibit. No specific portion of the statute has been cited to uphold this power. It is not found in sec. 28 (of the Securities Act), which is entitled "Powers (of the Commission) with Respect to Exchanges and Securities." 6 According to many court precedents, the general power to "regulate" which the Commission has (Sec. 33) does not imply authority to prohibit." 7 The Manila Stock Exchange, obviously the beneficiary of the disputed rule, contends that the power may be inferred from the express power of the Commission to suspend trading in a security, under said sec. 28 which reads partly:

And if in its opinion, the public interest so requires, summarily to suspend trading in any registered security on any securities exchange ... . (Sec. 28[3], Securities Act.) However, the Commission has not acted — nor claimed to have acted — in pursuance of such authority, for the simple reason that suspension under it may only be for ten days. Indeed, this section, if applicable, precisely argues against the position of the Commission because the "suspension," if it is, and as applied to Makati Stock Exchange, continues for an indefinite period, if not forever; whereas this Section 28 authorizes suspension for ten days only. Besides, the suspension of trading in the security should not be on one exchange only, but on all exchanges; bearing in mind that suspension should be ordered "for the protection of investors" (first par., sec. 28) in all exchanges, naturally, and if "the public interest so requires" [sec. 28(3)]. This brings up the Commission's principal conclusions underlying its determination viz.: (a) that the establishment of another exchange in the environs of Manila would be inimical to the public interest; and (b) that double or multiple listing of securities should be prohibited for the "protection of the investors." (a) Public Interest — Having already adverted to this aspect of the matter, and the emerging monopoly of the Manila Stock Exchange, we may, at this juncture, emphasize that by restricting free competition in the marketing of stocks, and depriving the public of the advantages thereof the Commission all but permits what the law punishes as monopolies as "crimes against public interest." 8 "A stock exchange is essentially monopolistic," the Commission states in its resolution (p. 14-a, Appendix, Brief for Petitioner). This reveals the basic foundation of the Commission's process of reasoning. And yet, a few pages afterwards, it recalls the benefits to be derived "from the existence of two or more exchanges," and the desirability of "a healthy and fair competition in the securities market," even as it expresses the belief that "a fair field of competition among stock exchanges should be encouraged only to resolve, paradoxically enough, that Manila Stock Exchange shall, in effect, continue to be the only stock exchange in Manila or in the Philippines. "Double listing of a security," explains the Commission, "divides the sellers and the buyers, thus destroying the essence of a stock exchange as a two-way auction market for the securities, where all the buyers and sellers in one geographical area converge in one defined place, and the bidders compete with each other to purchase the security at the lowest possible price and those seeking to sell it compete with each other to get the highest price therefor. In this sense, a stock exchange is essentially monopolistic." Inconclusive premises, for sure. For it is debatable whether the buyer of stock may get the lowest price where all the sellers assemble in only one place. The price there, in one sale, will tend to fix the price for the succeeding, sales, and he has no chance to get a lower price except at another stock exchange. Therefore, the arrangement desired by the Commission may, at most, be beneficial to sellers of stock — not to buyers — although what applies to buyers should obtain equally as to sellers (looking for higher prices). Besides, there is the brokerage fee which must be considered. Not to mention the personality of the broker. (b) Protection of investors. — At any rate, supposing the arrangement contemplated is beneficial to investors (as the Commission says), it is to be doubted whether it is "necessary" for their "protection" within the purview of the Securities Act. As the purpose of the Act is to give adequate and effective protection to the investing public against fraudulent representations, or false promises and the imposition of worthless ventures, 9 it is hard to see how the proposed concentration of the market has a necessary bearing to the prevention of deceptive devices or unlawful practices. For it is not mere semantics to declare that acts for the protection of investors are necessarily beneficial to them; but not everything beneficial to them is necessary for their protection. And yet, the Commission realizes that if there were two or more exchanges "the same security may sell for more in one exchange and sell for less in the other. Variance in price of the same security would be the rule ... ." Needless to add, the brokerage rates will also differ.

This, precisely, strengthens the objection to the Commission's ruling. Such difference in prices and rates gives the buyer of shares alternative options, with the opportunity to invest at lower expense; and the seller, to dispose at higher prices. Consequently, for the investors' benefit (protection is not the word), quality of listing 10 should be permitted, nay, encouraged, and other exchanges allowed to operate. The circumstance that some people "made a lot of money due to the difference in prices of securities traded in the stock exchanges of Manila before the war" as the Commission noted, furnishes no sufficient reason to let one exchange corner the market. If there was undue manipulation or unfair advantage in exchange trading the Commission should have other means to correct the specific abuses. Granted that, as the Commission observes, "what the country needs is not another" market for securities already listed on the Manila Stock Exchange, but "one that would focus its attention and energies on the listing of new securities and thus effectively help in raising capital sorely needed by our ... unlisted industries and enterprises." Nonetheless, we discover no legal authority for it to shore up (and stifle) free enterprise and individual liberty along channels leading to that economic desideratum. 11 The Legislature has specified the conditions under which a stock exchange may legally obtain a permit (sec. 17, Securities Act); it is not for the Commission to impose others. If the existence of two competing exchanges jeopardizes public interest — which is doubtful — let the Congress speak. 12 Undoubtedly, the opinion and recommendation of the Commission will be given weight by the Legislature, in judging whether or not to restrict individual enterprise and business opportunities. But until otherwise directed by law, the operation of exchanges should not be so regulated as practically to create a monopoly by preventing the establishment of other stock exchanges and thereby contravening: (a) the organizers' (Makati's) Constitutional right to equality before the law; (b) their guaranteed civil liberty to pursue any lawful employment or trade; and (c) the investor's right to choose where to buy or to sell, and his privilege to select the brokers in his employment. 13 And no extended elucidation is needed to conclude that for a licensing officer to deny license solely on the basis of what he believes is best for the economy of the country may amount to regimentation or, in this instance, the exercise of undelegated legislative powers and discretion. Thus, it has been held that where the licensing statute does not expressly or impliedly authorize the officer in charge, he may not refuse to grant a license simply on the ground that a sufficient number of licenses to serve the needs of the public have already been issued. (53 C.J.S. p. 636.) Concerning res judicata. — Calling attention to the Commission's order of May 27, 1963, which Makati Stock did not appeal, the Manila Stock Exchange pleads the doctrine of res judicata. 14 (The order now reviewed is dated May 7, 1964.) It appears that when Makati Stock Exchange, Inc. presented its articles of incorporation to the Commission, the latter, after making some inquiries, issued on May 27, 1963, an order reading as follows. Let the certificate of incorporation of the MAKATI STOCK EXCHANGE be issued, and if the organizers thereof are willing to abide by the foregoing conditions, they may file the proper application for the registration and licensing of the said Exchange. In that order, the Commission advanced the opinion that "it would permit the establishment and operation of the proposed Makati Stock Exchange, provided ... it shall not list for trading on its board, securities already listed in the Manila Stock Exchange ... ."

Admittedly, Makati Stock Exchange, Inc. has not appealed from that order of May 27, 1963. Now, Manila Stock insists on res judicata. Why should Makati have appealed? It got the certificate of incorporation which it wanted. The condition or proviso mentioned would only apply if and when it subsequently filed the application for registration as stock exchange. It had not yet applied. It was not the time to question the condition; 15 Makati was still exploring the convenience of soliciting the permit to operate subject to that condition. And it could have logically thought that, since the condition did not affect its articles of incorporation, it should not appeal the order (of May 27, 1963) which after all, granted the certificate of incorporation (corporate existence) it wanted at that time. And when the Makati Stock Exchange finally found that it could not successfully operate with the condition attached, it took the issue by the horns, and expressing its desire for registration and license, it requested that the condition (against double listing) be dispensed with. The order of the Commission denying, such request is dated May 7, 1964, and is now under, review. Indeed, there can be no valid objection to the discussion of this issue of double listing now, 16 because even if the Makati Stock Exchange, Inc. may be held to have accepted the permission to operate with the condition against double listing (for having failed to appeal the order of May 27, 1963), still it was not precluded from afterwards contesting 17 the validity of such condition or rule: (1) An agreement (which shall not be construed as a waiver of any constitutional right or any right to contest the validity of any rule or regulation) to comply and to enforce so far as is within its powers, compliance by its members, with the provisions of this Act, and any amendment thereto, and any rule or regulation made or to be made thereunder. (See. 17-a-1, Securities Act [Emphasis Ours].) Surely, this petition for review has suitably been coursed. And making reasonable allowances for the presumption of regularity and validity of administrative action, we feel constrained to reach the conclusion that the respondent Commission possesses no power to impose the condition of the rule, which, additionally, results in discrimination and violation of constitutional rights. ACCORDINGLY, the license of the petition to operate a stock exchange is approved without such condition. Costs shall be paid by the Manila Stock Exchange. So ordered.

G.R. No. 163980 August 3, 2006 HOLY SPIRIT HOMEOWNERS ASSOCIATION, INC. and NESTORIO F. APOLINARIO, in his personal capacity and as President of Holy Spirit Homeowners Association, Inc., Petitioners, vs. SECRETARY MICHAEL DEFENSOR, in his capacity as Chairman of the Housing and Urban Development Coordinating Council (HUDCC), ATTY. EDGARDO PAMINTUAN, in his capacity as General Manager of the National Housing Authority (NHA), MR. PERCIVAL CHAVEZ, in his capacity as Chairman of the PresidentialCommission for the Urban Poor (PCUP), MAYOR FELICIANO BELMONTE, in his capacity as Mayor of Quezon City, SECRETARY ELISEA GOZUN, in her capacity as Secretary of the Department of Environment and Natural Resources (DENR) and SECRETARY FLORENTE SORIQUEZ, in his capacity as Secretary of the Department of Public Works and Highways (DPWH) as ex-officio members of the NATIONAL GOVERNMENT CENTER ADMINISTRATION COMMITTEE, Respondents. DECISION TINGA, J.:

The instant petition for prohibition under Rule 65 of the 1997 Rules of Civil Procedure, with prayer for the issuance of a temporary restraining order and/or writ of preliminary injunction, seeks to prevent respondents from enforcing the implementing rules and regulations (IRR) of Republic Act No. 9207, otherwise known as the "National Government Center (NGC) Housing and Land Utilization Act of 2003." Petitioner Holy Spirit Homeowners Association, Inc. (Association) is a homeowners association from the West Side of the NGC. It is represented by its president, Nestorio F. Apolinario, Jr., who is a co-petitioner in his own personal capacity and on behalf of the association. Named respondents are the ex-officio members of the National Government Center Administration Committee (Committee). At the filing of the instant petition, the Committee was composed of Secretary Michael Defensor, Chairman of the Housing and Urban Development Coordinating Council (HUDCC), Atty. Edgardo Pamintuan, General Manager of the National Housing Authority (NHA), Mr. Percival Chavez, Chairman of the Presidential Commission for Urban Poor (PCUP), Mayor Feliciano Belmonte of Quezon City, Secretary Elisea Gozun of the Department of Environment and Natural Resources (DENR), and Secretary Florante Soriquez of the Department of Public Works and Highways (DPWH). Prior to the passage of R.A. No. 9207, a number of presidential issuances authorized the creation and development of what is now known as the National Government Center (NGC). On March 5, 1972, former President Ferdinand Marcos issued Proclamation No. 1826, reserving a parcel of land in Constitution Hills, Quezon City, covering a little over 440 hectares as a national government site to be known as the NGC. 1 On August 11, 1987, then President Corazon Aquino issued Proclamation No. 137, excluding 150 of the 440 hectares of the reserved site from the coverage of Proclamation No. 1826 and authorizing instead the disposition of the excluded portion by direct sale to the bona fide residents therein. 2 In view of the rapid increase in population density in the portion excluded by Proclamation No. 137 from the coverage of Proclamation No. 1826, former President Fidel Ramos issued Proclamation No. 248 on September 7, 1993, authorizing the vertical development of the excluded portion to maximize the number of families who can effectively become beneficiaries of the government’s socialized housing program. 3 On May 14, 2003, President Gloria Macapagal-Arroyo signed into law R.A. No. 9207. Among the salient provisions of the law are the following: Sec. 2. Declaration of Policy. – It is hereby declared the policy of the State to secure the land tenure of the urban poor. Toward this end, lands located in the NGC, Quezon City shall be utilized for housing, socioeconomic, civic, educational, religious and other purposes. Sec. 3. Disposition of Certain Portions of the National Government Center Site to Bona Fide Residents. – Proclamation No. 1826, Series of 1979, is hereby amended by excluding from the coverage thereof, 184 hectares on the west side and 238 hectares on the east side of Commonwealth Avenue, and declaring the same open for disposition to bona fide residents therein: Provided, That the determination of the bona fide residents on the west side shall be based on the census survey conducted in 1994 and the determination of the bona fide residents on the east side shall be based on the census survey conducted in 1994 and occupancy verification survey conducted in 2000: Provided, further, That all existing legal agreements, programs and plans signed, drawn up or implemented and actions taken, consistent with the provisions of this Act are hereby adopted. Sec. 4. Disposition of Certain Portions of the National Government Center Site for Local Government or Community Facilities, Socioeconomic, Charitable, Educational and Religious Purposes. – Certain portions of land within the aforesaid area for local government or community facilities, socioeconomic, charitable, educational and religious institutions are hereby reserved for disposition for such purposes: Provided, That only those institutions already operating and with existing facilities or structures, or those occupying the land

may avail of the disposition program established under the provisions this Act; Provided, further, That in ascertaining the specific areas that may be disposed of in favor of these institutions, the existing site allocation shall be used as basis therefore: Provided, finally. That in determining the reasonable lot allocation of such institutions without specific lot allocations, the land area that may be allocated to them shall be based on the area actually used by said institutions at the time of effectivity of this Act. (Emphasis supplied.) In accordance with Section 5 of R.A. No. 9207, 4 the Committee formulated the Implementing Rules and Regulations (IRR) of R.A. No. 9207 on June 29, 2004. Petitioners subsequently filed the instant petition, raising the following issues: WHETHER OR NOT SECTION 3.1 (A.4), 3.1 (B.2), 3.2 (A.1) AND 3.2 (C.1) OF THE RULES AND REGULATIONS OF REPUBLIC ACT NO. 9207, OTHERWISE KNOWN AS "NATIONAL GOVERNMENT CENTER (NGC) HOUSING AND LAND UTILIZATION ACT OF 2003" SHOULD BE DECLARED NULL AND VOID FOR BEING INCONSISTENT WITH THE LAW IT SEEKS TO IMPLEMENT. WHETHER OR NOT SECTION 3.1 (A.4), 3.1 (B.2), 3.2 (A.1) AND 3.2 (C.1) OF THE RULES AND REGULATIONS OF REPUBLIC ACT NO. 9207, OTHERWISE KNOWN AS "NATIONAL GOVERNMENT CENTER (NGC) HOUSING AND LAND UTILIZATION ACT OF 2003" SHOULD BE DECLARED NULL AND VOID FOR BEING ARBITRARY, CAPRICIOUS AND WHIMSICAL. 5 First, the procedural matters. The Office of the Solicitor General (OSG) argues that petitioner Association cannot question the implementation of Section 3.1 (b.2) and Section 3.2 (c.1) since it does not claim any right over the NGC East Side. Section 3.1 (b.2) provides for the maximum lot area that may be awarded to a resident-beneficiary of the NGC East Side, while Section 3.2 (c.1) imposes a lot price escalation penalty to a qualified beneficiary who fails to execute a contract to sell within the prescribed period. 6 Also, the OSG contends that since petitioner association is not the duly recognized people’s organization in the NGC and since petitioners not qualify as beneficiaries, they cannot question the manner of disposition of lots in the NGC. 7 "Legal standing" or locus standi has been defined as a personal and substantial interest in the case such that the party has sustained or will sustain direct injury as a result of the governmental act that is being challenged…. The gist of the question of standing is whether a party alleges "such personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court depends for illumination of difficult constitutional questions." 8 Petitioner association has the legal standing to institute the instant petition, whether or not it is the duly recognized association of homeowners in the NGC. There is no dispute that the individual members of petitioner association are residents of the NGC. As such they are covered and stand to be either benefited or injured by the enforcement of the IRR, particularly as regards the selection process of beneficiaries and lot allocation to qualified beneficiaries. Thus, petitioner association may assail those provisions in the IRR which it believes to be unfavorable to the rights of its members. Contrary to the OSG’s allegation that the failure of petitioner association and its members to qualify as beneficiaries effectively bars them from questioning the provisions of the IRR, such circumstance precisely operates to confer on them the legal personality to assail the IRR. Certainly, petitioner and its members have sustained direct injury arising from the enforcement of the IRR in that they have been disqualified and eliminated from the selection process. While it is true that petitioners claim rights over the NGC West Side only and thus cannot be affected by the implementation of Section 3.1 (b.2), which refers to the NGC East Side, the rest of the assailed provisions of the IRR, namely, Sections 3.1 (a.4), 3.2 (a.1) and 3.2 (c.1), govern the disposition of lots in the West Side itself or all the lots in the NGC. We cannot, therefore, agree with the OSG on the issue of locus standi. The petition does not merit dismissal on that ground.

There are, however, other procedural impediments to the granting of the instant petition. The OSG claims that the instant petition for prohibition is an improper remedy because the writ of prohibition does not lie against the exercise of a quasi-legislative function. 9 Since in issuing the questioned IRR of R.A. No. 9207, the Committee was not exercising judicial, quasi-judicial or ministerial function, which is the scope of a petition for prohibition under Section 2, Rule 65 of the 1997 Rules of Civil Procedure, the instant prohibition should be dismissed outright, the OSG contends. For their part, respondent Mayor of Quezon City 10 and respondent NHA 11 contend that petitioners violated the doctrine of hierarchy of courts in filing the instant petition with this Court and not with the Court of Appeals, which has concurrent jurisdiction over a petition for prohibition. The cited breaches are mortal. The petition deserves to be spurned as a consequence. Administrative agencies possess quasi-legislative or rule-making powers and quasi-judicial or administrative adjudicatory powers. Quasi-legislative or rule-making power is the power to make rules and regulations which results in delegated legislation that is within the confines of the granting statute and the doctrine of nondelegability and separability of powers. 12 In questioning the validity or constitutionality of a rule or regulation issued by an administrative agency, a party need not exhaust administrative remedies before going to court. This principle, however, applies only where the act of the administrative agency concerned was performed pursuant to its quasi-judicial function, and not when the assailed act pertained to its rule-making or quasi-legislative power. 13 The assailed IRR was issued pursuant to the quasi-legislative power of the Committee expressly authorized by R.A. No. 9207. The petition rests mainly on the theory that the assailed IRR issued by the Committee is invalid on the ground that it is not germane to the object and purpose of the statute it seeks to implement. Where what is assailed is the validity or constitutionality of a rule or regulation issued by the administrative agency in the performance of its quasi-legislative function, the regular courts have jurisdiction to pass upon the same. 14 Since the regular courts have jurisdiction to pass upon the validity of the assailed IRR issued by the Committee in the exercise of its quasi-legislative power, the judicial course to assail its validity must follow the doctrine of hierarchy of courts. Although the Supreme Court, Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunction, such concurrence does not give the petitioner unrestricted freedom of choice of court forum. 15 True, this Court has the full discretionary power to take cognizance of the petition filed directly with it if compelling reasons, or the nature and importance of the issues raised, so warrant. 16 A direct invocation of the Court’s original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. 17 In Heirs of Bertuldo Hinog v. Melicor, 18 the Court said that it will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts, and exceptional and compelling circumstances, such as cases of national interest and of serious implications, justify the availment of the extraordinary remedy of writ of certiorari, calling for the exercise of its primary jurisdiction. 19 A perusal, however, of the petition for prohibition shows no compelling, special or important reasons to warrant the Court’s taking cognizance of the petition in the first instance. Petitioner also failed to state any reason that precludes the lower courts from passing upon the validity of the questioned IRR. Moreover, as provided in Section 5, Article VIII of the Constitution, 20 the Court’s power to evaluate the validity of an implementing rule or regulation is generally appellate in nature. Thus, following the doctrine of hierarchy of courts, the instant petition should have been initially filed with the Regional Trial Court. A petition for prohibition is also not the proper remedy to assail an IRR issued in the exercise of a quasilegislative function. Prohibition is an extraordinary writ directed against any tribunal, corporation, board, officer or person, whether exercising judicial, quasi-judicial or ministerial functions, ordering said entity or person to desist from further proceedings when said proceedings are without or in excess of said entity’s or person’s jurisdiction, or are accompanied with grave abuse of discretion, and there is no appeal or any other plain,

speedy and adequate remedy in the ordinary course of law. 21 Prohibition lies against judicial or ministerial functions, but not against legislative or quasi-legislative functions. Generally, the purpose of a writ of prohibition is to keep a lower court within the limits of its jurisdiction in order to maintain the administration of justice in orderly channels. 22 Prohibition is the proper remedy to afford relief against usurpation of jurisdiction or power by an inferior court, or when, in the exercise of jurisdiction in handling matters clearly within its cognizance the inferior court transgresses the bounds prescribed to it by the law, or where there is no adequate remedy available in the ordinary course of law by which such relief can be obtained. 23 Where the principal relief sought is to invalidate an IRR, petitioners’ remedy is an ordinary action for its nullification, an action which properly falls under the jurisdiction of the Regional Trial Court. In any case, petitioners’ allegation that "respondents are performing or threatening to perform functions without or in excess of their jurisdiction" may appropriately be enjoined by the trial court through a writ of injunction or a temporary restraining order. In a number of petitions, 24 the Court adequately resolved them on other grounds without adjudicating on the constitutionality issue when there were no compelling reasons to pass upon the same. In like manner, the instant petition may be dismissed based on the foregoing procedural grounds. Yet, the Court will not shirk from its duty to rule on the merits of this petition to facilitate the speedy resolution of this case. In proper cases, procedural rules may be relaxed or suspended in the interest of substantial justice. And the power of the Court to except a particular case from its rules whenever the purposes of justice require it cannot be questioned. 25 Now, we turn to the substantive aspects of the petition. The outcome, however, is just as dismal for petitioners. Petitioners assail the following provisions of the IRR: Section 3. Disposition of Certain portions of the NGC Site to the bonafide residents 3.1. Period for Qualification of Beneficiaries xxxx (a.4) Processing and evaluation of qualifications shall be based on the Code of Policies and subject to the condition that a beneficiary is qualified to acquire only one (1) lot with a minimum of 36 sq. m. and maximum of 54 sq. m. and subject further to the availability of lots. xxxx (b.2) Applications for qualification as beneficiary shall be processed and evaluated based on the Code of Policies including the minimum and maximum lot allocation of 35 sq. m. and 60 sq. m. xxxx 3.2. Execution of the Contract to Sell (a) Westside (a.1) All qualified beneficiaries shall execute Contract to Sell (CTS) within sixty (60) days from the effectivity of the IRR in order to avail of the lot at P700.00 per sq. m. xxxx (c) for both eastside and westside (c.1) Qualified beneficiaries who failed to execute CTS on the deadline set in item a.1 above in case of westside and in case of eastside six (6) months after approval of the subdivision plan shall be subjected to lot price escalation.

The rate shall be based on the formula to be set by the National Housing Authority factoring therein the affordability criteria. The new rate shall be approved by the NGC-Administration Committee (NGC-AC). Petitioners contend that the aforequoted provisions of the IRR are constitutionally infirm as they are not germane to and/or are in conflict with the object and purpose of the law sought to be implemented. First. According to petitioners, the limitation on the areas to be awarded to qualified beneficiaries under Sec. 3.1 (a.4) and (b.2) of the IRR is not in harmony with the provisions of R.A. No. 9207, which mandates that the lot allocation to qualified beneficiaries shall be based on the area actually used or occupied by bona fide residents without limitation to area. The argument is utterly baseless. The beneficiaries of lot allocations in the NGC may be classified into two groups, namely, the urban poor or the bona fide residents within the NGC site and certain government institutions including the local government. Section 3, R.A. No. 9207 mandates the allocation of additional property within the NGC for disposition to its bona fide residents and the manner by which this area may be distributed to qualified beneficiaries. Section 4, R.A. No. 9207, on the other hand, governs the lot disposition to government institutions. While it is true that Section 4 of R.A. No. 9207 has a proviso mandating that the lot allocation shall be based on the land area actually used or occupied at the time of the law’s effectivity, this proviso applies only to institutional beneficiaries consisting of the local government, socioeconomic, charitable, educational and religious institutions which do not have specific lot allocations, and not to the bona fide residents of NGC. There is no proviso which even hints that a bona fide resident of the NGC is likewise entitled to the lot area actually occupied by him. Petitioners’ interpretation is also not supported by the policy of R.A. No. 9207 and the prior proclamations establishing the NGC. The government’s policy to set aside public property aims to benefit not only the urban poor but also the local government and various government institutions devoted to socioeconomic, charitable, educational and religious purposes. 26 Thus, although Proclamation No. 137 authorized the sale of lots to bona fide residents in the NGC, only a third of the entire area of the NGC was declared open for disposition subject to the condition that those portions being used or earmarked for public or quasi-public purposes would be excluded from the housing program for NGC residents. The same policy of rational and optimal land use can be read in Proclamation No. 248 issued by then President Ramos. Although the proclamation recognized the rapid increase in the population density in the NGC, it did not allocate additional property within the NGC for urban poor housing but instead authorized the vertical development of the same 150 hectares identified previously by Proclamation No. 137 since the distribution of individual lots would not adequately provide for the housing needs of all the bona fide residents in the NGC. In addition, as provided in Section 4 of R.A. No. 9207, the institutional beneficiaries shall be allocated the areas actually occupied by them; hence, the portions intended for the institutional beneficiaries is fixed and cannot be allocated for other non-institutional beneficiaries. Thus, the areas not intended for institutional beneficiaries would have to be equitably distributed among the bona fide residents of the NGC. In order to accommodate all qualified residents, a limitation on the area to be awarded to each beneficiary must be fixed as a necessary consequence. Second. Petitioners note that while Sec. 3.2 (a.1) of the IRR fixes the selling rate of a lot at P700.00 per sq. m., R.A. No. 9207 does not provide for the price. They add Sec. 3.2 (c.1) penalizes a beneficiary who fails to execute a contract to sell within six (6) months from the approval of the subdivision plan by imposing a price escalation, while there is no such penalty imposed by R.A. No. 9207. Thus, they conclude that the assailed provisions conflict with R.A. No. 9207 and should be nullified. The argument deserves scant consideration. Where a rule or regulation has a provision not expressly stated or contained in the statute being implemented, that provision does not necessarily contradict the statute. A legislative rule is in the nature of subordinate legislation, designed to implement a primary legislation by providing the details thereof. 27 All that is required is that the regulation should be germane to the objects and purposes of the law; that the regulation be not in contradiction to but in conformity with the standards prescribed by the law. 28

In Section 5 of R.A. No. 9207, the Committee is granted the power to administer, formulate guidelines and policies, and implement the disposition of the areas covered by the law. Implicit in this authority and the statute’s objective of urban poor housing is the power of the Committee to formulate the manner by which the reserved property may be allocated to the beneficiaries. Under this broad power, the Committee is mandated to fill in the details such as the qualifications of beneficiaries, the selling price of the lots, the terms and conditions governing the sale and other key particulars necessary to implement the objective of the law. These details are purposely omitted from the statute and their determination is left to the discretion of the Committee because the latter possesses special knowledge and technical expertise over these matters. The Committee’s authority to fix the selling price of the lots may be likened to the rate-fixing power of administrative agencies. In case of a delegation of rate-fixing power, the only standard which the legislature is required to prescribe for the guidance of the administrative authority is that the rate be reasonable and just. However, it has been held that even in the absence of an express requirement as to reasonableness, this standard may be implied. 29 In this regard, petitioners do not even claim that the selling price of the lots is unreasonable. The provision on the price escalation clause as a penalty imposed to a beneficiary who fails to execute a contract to sell within the prescribed period is also within the Committee’s authority to formulate guidelines and policies to implement R.A. No. 9207. The Committee has the power to lay down the terms and conditions governing the disposition of said lots, provided that these are reasonable and just. There is nothing objectionable about prescribing a period within which the parties must execute the contract to sell. This condition can ordinarily be found in a contract to sell and is not contrary to law, morals, good customs, public order, or public policy. Third. Petitioners also suggest that the adoption of the assailed IRR suffers from a procedural flaw. According to them the IRR was adopted and concurred in by several representatives of people’s organizations contrary to the express mandate of R.A. No. 9207 that only two representatives from duly recognized peoples’ organizations must compose the NGCAC which promulgated the assailed IRR. It is worth noting that petitioner association is not a duly recognized people’s organization. In subordinate legislation, as long as the passage of the rule or regulation had the benefit of a hearing, the procedural due process requirement is deemed complied with. That there is observance of more than the minimum requirements of due process in the adoption of the questioned IRR is not a ground to invalidate the same. In sum, the petition lacks merit and suffers from procedural deficiencies. WHEREFORE, the instant petition for prohibition is DISMISSED. Costs against petitioners. SO ORDERED.

G.R. No. 101279 August 6, 1992 PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC., petitioner, vs. HON. RUBEN D. TORRES, as Secretary of the Department of Labor & Employment, and JOSE N. SARMIENTO, as Administrator of the PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, respondents. GRIÑO-AQUINO, J.: This petition for prohibition with temporary restraining order was filed by the Philippine Association of Service Exporters (PASEI, for short), to prohibit and enjoin the Secretary of the Department of Labor and Employment (DOLE) and the Administrator of the Philippine Overseas Employment Administration (or POEA) from enforcing and implementing DOLE Department Order No. 16, Series of 1991 and POEA Memorandum

Circulars Nos. 30 and 37, Series of 1991, temporarily suspending the recruitment by private employment agencies of Filipino domestic helpers for Hong Kong and vesting in the DOLE, through the facilities of the POEA, the task of processing and deploying such workers. PASEI is the largest national organization of private employment and recruitment agencies duly licensed and authorized by the POEA, to engaged in the business of obtaining overseas employment for Filipino landbased workers, including domestic helpers. On June 1, 1991, as a result of published stories regarding the abuses suffered by Filipino housemaids employed in Hong Kong, DOLE Secretary Ruben D. Torres issued Department Order No. 16, Series of 1991, temporarily suspending the recruitment by private employment agencies of "Filipino domestic helpers going to Hong Kong" (p. 30, Rollo). The DOLE itself, through the POEA took over the business of deploying such Hong Kong-bound workers. In view of the need to establish mechanisms that will enhance the protection for Filipino domestic helpers going to Hong Kong, the recruitment of the same by private employment agencies is hereby temporarily suspended effective 1 July 1991. As such, the DOLE through the facilities of the Philippine Overseas Employment Administration shall take over the processing and deployment of household workers bound for Hong Kong, subject to guidelines to be issued for said purpose. In support of this policy, all DOLE Regional Directors and the Bureau of Local Employment's regional offices are likewise directed to coordinate with the POEA in maintaining a manpower pool of prospective domestic helpers to Hong Kong on a regional basis. For compliance. (Emphasis ours; p. 30, Rollo.) Pursuant to the above DOLE circular, the POEA issued Memorandum Circular No. 30, Series of 1991, dated July 10, 1991, providing GUIDELINES on the Government processing and deployment of Filipino domestic helpers to Hong Kong and the accreditation of Hong Kong recruitment agencies intending to hire Filipino domestic helpers. Subject: Guidelines on the Temporary Government Processing and Deployment of Domestic Helpers to Hong Kong. Pursuant to Department Order No. 16, series of 1991 and in order to operationalize the temporary government processing and deployment of domestic helpers (DHs) to Hong Kong resulting from the temporary suspension of recruitment by private employment agencies for said skill and host market, the following guidelines and mechanisms shall govern the implementation of said policy. I. Creation of a joint POEA-OWWA Household Workers Placement Unit (HWPU) An ad hoc, one stop Household Workers Placement Unit [or HWPU] under the supervision of the POEA shall take charge of the various operations involved in the Hong Kong-DH industry segment: The HWPU shall have the following functions in coordination with appropriate units and other entities concerned: 1. Negotiations with and Accreditation of Hong Kong Recruitment Agencies 2. Manpower Pooling 3. Worker Training and Briefing

4. Processing and Deployment 5. Welfare Programs II. Documentary Requirements and Other Conditions for Accreditation of Hong Kong Recruitment Agencies or Principals Recruitment agencies in Hong Kong intending to hire Filipino DHs for their employers may negotiate with the HWPU in Manila directly or through the Philippine Labor Attache's Office in Hong Kong. xxx xxx xxx X. Interim Arrangement All contracts stamped in Hong Kong as of June 30 shall continue to be processed by POEA until 31 July 1991 under the name of the Philippine agencies concerned. Thereafter, all contracts shall be processed with the HWPU. Recruitment agencies in Hong Kong shall submit to the Philippine Consulate General in Hong kong a list of their accepted applicants in their pool within the last week of July. The last day of acceptance shall be July 31 which shall then be the basis of HWPU in accepting contracts for processing. After the exhaustion of their respective pools the only source of applicants will be the POEA manpower pool. For strict compliance of all concerned. (pp. 31-35, Rollo.) On August 1, 1991, the POEA Administrator also issued Memorandum Circular No. 37, Series of 1991, on the processing of employment contracts of domestic workers for Hong Kong. TO: All Philippine and Hong Kong Agencies engaged in the recruitment of Domestic helpers for Hong Kong Further to Memorandum Circular No. 30, series of 1991 pertaining to the government processing and deployment of domestic helpers (DHs) to Hong Kong, processing of employment contracts which have been attested by the Hong Kong Commissioner of Labor up to 30 June 1991 shall be processed by the POEA Employment Contracts Processing Branch up to 15 August 1991 only. Effective 16 August 1991, all Hong Kong recruitment agent/s hiring DHs from the Philippines shall recruit under the new scheme which requires prior accreditation which the POEA. Recruitment agencies in Hong Kong may apply for accreditation at the Office of the Labor Attache, Philippine Consulate General where a POEA team is posted until 31 August 1991. Thereafter, those who failed to have themselves accredited in Hong Kong may proceed to the POEA-OWWA Household Workers Placement Unit in Manila for accreditation before their recruitment and processing of DHs shall be allowed. Recruitment agencies in Hong Kong who have some accepted applicants in their pool after the cut-off period shall submit this list of workers upon accreditation. Only those DHs in said list will be allowed processing outside of the HWPU manpower pool. For strict compliance of all concerned. (Emphasis supplied, p. 36, Rollo.)

On September 2, 1991, the petitioner, PASEI, filed this petition for prohibition to annul the aforementioned DOLE and POEA circulars and to prohibit their implementation for the following reasons: 1. that the respondents acted with grave abuse of discretion and/or in excess of their rulemaking authority in issuing said circulars; 2. that the assailed DOLE and POEA circulars are contrary to the Constitution, are unreasonable, unfair and oppressive; and 3. that the requirements of publication and filing with the Office of the National Administrative Register were not complied with. There is no merit in the first and second grounds of the petition. Article 36 of the Labor Code grants the Labor Secretary the power to restrict and regulate recruitment and placement activities. Art. 36. Regulatory Power. — The Secretary of Labor shall have the power to restrict and regulate the recruitment and placement activities of all agencies within the coverage of this title [Regulation of Recruitment and Placement Activities] and is hereby authorized to issue orders and promulgate rules and regulations to carry out the objectives and implement the provisions of this title. (Emphasis ours.) On the other hand, the scope of the regulatory authority of the POEA, which was created by Executive Order No. 797 on May 1, 1982 to take over the functions of the Overseas Employment Development Board, the National Seamen Board, and the overseas employment functions of the Bureau of Employment Services, is broad and far-ranging for: 1. Among the functions inherited by the POEA from the defunct Bureau of Employment Services was the power and duty: "2. To establish and maintain a registration and/or licensing system to regulate private sector participation in the recruitment and placement of workers, locally and overseas, . . ." (Art. 15, Labor Code, Emphasis supplied). (p. 13, Rollo.) 2. It assumed from the defunct Overseas Employment Development Board the power and duty: 3. To recruit and place workers for overseas employment of Filipino contract workers on a government to government arrangement and in such other sectors as policy may dictate . . . (Art. 17, Labor Code.) (p. 13, Rollo.) 3. From the National Seamen Board, the POEA took over: 2. To regulate and supervise the activities of agents or representatives of shipping companies in the hiring of seamen for overseas employment; and secure the best possible terms of employment for contract seamen workers and secure compliance therewith. (Art. 20, Labor Code.) The vesture of quasi-legislative and quasi-judicial powers in administrative bodies is not unconstitutional, unreasonable and oppressive. It has been necessitated by "the growing complexity of the modern society" (Solid Homes, Inc. vs. Payawal, 177 SCRA 72, 79). More and more administrative bodies are necessary to help in the regulation of society's ramified activities. "Specialized in the particular field assigned to them, they can deal with the problems thereof with more expertise and dispatch than can be expected from the legislature or the courts of justice" (Ibid.).

It is noteworthy that the assailed circulars do not prohibit the petitioner from engaging in the recruitment and deployment of Filipino landbased workers for overseas employment. A careful reading of the challenged administrative issuances discloses that the same fall within the "administrative and policing powers expressly or by necessary implication conferred" upon the respondents (People vs. Maceren, 79 SCRA 450). The power to "restrict and regulate conferred by Article 36 of the Labor Code involves a grant of police power (City of Naga vs. Court of Appeals, 24 SCRA 898). To "restrict" means "to confine, limit or stop" (p. 62, Rollo) and whereas the power to "regulate" means "the power to protect, foster, promote, preserve, and control with due regard for the interests, first and foremost, of the public, then of the utility and of its patrons" (Philippine Communications Satellite Corporation vs. Alcuaz, 180 SCRA 218). The Solicitor General, in his Comment, aptly observed: . . . Said Administrative Order [i.e., DOLE Administrative Order No. 16] merely restricted the scope or area of petitioner's business operations by excluding therefrom recruitment and deployment of domestic helpers for Hong Kong till after the establishment of the "mechanisms" that will enhance the protection of Filipino domestic helpers going to Hong Kong. In fine, other than the recruitment and deployment of Filipino domestic helpers for Hongkong, petitioner may still deploy other class of Filipino workers either for Hongkong and other countries and all other classes of Filipino workers for other countries. Said administrative issuances, intended to curtail, if not to end, rampant violations of the rule against excessive collections of placement and documentation fees, travel fees and other charges committed by private employment agencies recruiting and deploying domestic helpers to Hongkong. [They are reasonable, valid and justified under the general welfare clause of the Constitution, since the recruitment and deployment business, as it is conducted today, is affected with public interest. xxx xxx xxx The alleged takeover [of the business of recruiting and placing Filipino domestic helpers in Hongkong] is merely a remedial measure, and expires after its purpose shall have been attained. This is evident from the tenor of Administrative Order No. 16 that recruitment of Filipino domestic helpers going to Hongkong by private employment agencies are hereby "temporarily suspended effective July 1, 1991." The alleged takeover is limited in scope, being confined to recruitment of domestic helpers going to Hongkong only. xxx xxx xxx . . . the justification for the takeover of the processing and deploying of domestic helpers for Hongkong resulting from the restriction of the scope of petitioner's business is confined solely to the unscrupulous practice of private employment agencies victimizing applicants for employment as domestic helpers for Hongkong and not the whole recruitment business in the Philippines. (pp. 62-65, Rollo.) The questioned circulars are therefore a valid exercise of the police power as delegated to the executive branch of Government. Nevertheless, they are legally invalid, defective and unenforceable for lack of power publication and filing in the Office of the National Administrative Register as required in Article 2 of the Civil Code, Article 5 of the Labor Code and Sections 3(1) and 4, Chapter 2, Book VII of the Administrative Code of 1987 which provide: Art. 2. Laws shall take effect after fifteen (15) days following the completion of their publication in the Official Gazatte, unless it is otherwise provided. . . . (Civil Code.)

Art. 5. Rules and Regulations. — The Department of Labor and other government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation. (Emphasis supplied, Labor Code, as amended.) Sec. 3. Filing. — (1) Every agency shall file with the University of the Philippines Law Center, three (3) certified copies of every rule adopted by it. Rules in force on the date of effectivity of this Code which are not filed within three (3) months shall not thereafter be the basis of any sanction against any party or persons. (Emphasis supplied, Chapter 2, Book VII of the Administrative Code of 1987.) Sec. 4. Effectivity. — In addition to other rule-making requirements provided by law not inconsistent with this Book, each rule shall become effective fifteen (15) days from the date of filing as above provided unless a different date is fixed by law, or specified in the rule in cases of imminent danger to public health, safety and welfare, the existence of which must be expressed in a statement accompanying the rule. The agency shall take appropriate measures to make emergency rules known to persons who may be affected by them. (Emphasis supplied, Chapter 2, Book VII of the Administrative Code of 1987). Once, more we advert to our ruling in Tañada vs. Tuvera, 146 SCRA 446 that: . . . Administrative rules and regulations must also be published if their purpose is to enforce or implement existing law pursuant also to a valid delegation. (p. 447.) Interpretative regulations and those merely internal in nature, that is, regulating only the personnel of the administrative agency and not the public, need not be published. Neither is publication required of the so-called letters of instructions issued by administrative superiors concerning the rules or guidelines to be followed by their subordinates in the performance of their duties. (p. 448.) We agree that publication must be in full or it is no publication at all since its purpose is to inform the public of the content of the laws. (p. 448.) For lack of proper publication, the administrative circulars in question may not be enforced and implemented. WHEREFORE, the writ of prohibition is GRANTED. The implementation of DOLE Department Order No. 16, Series of 1991, and POEA Memorandum Circulars Nos. 30 and 37, Series of 1991, by the public respondents is hereby SUSPENDED pending compliance with the statutory requirements of publication and filing under the aforementioned laws of the land. SO ORDERED.