[G.R. No. 135962.

March 27, 2000]

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs.
BEL-AIR VILLAGE ASSOCIATION, INC., respondent.
DECISION

"Finally, we are furnishing you with a copy of the handwritten instruction of

the President on the matter.
"Very truly yours,
PROSPERO I. ORETA

PUNO, J.:

Chairman"[1]

Not infrequently, the government is tempted to take legal shortcuts to solve

urgent problems of the people. But even when government is armed with the
best of intention, we cannot allow it to run roughshod over the rule of law.
Again, we let the hammer fall and fall hard on the illegal attempt of the
MMDA to open for public use a private road in a private subdivision. While
we hold that the general welfare should be promoted, we stress that it should
not be achieved at the expense of the rule of law.

On the same day, respondent was apprised that the perimeter wall
separating the subdivision from the adjacent Kalayaan Avenue would be
demolished. Sppedsc

Petitioner MMDA is a government agency tasked with the delivery of basic

services in Metro Manila. Respondent Bel-Air Village Association, Inc.
(BAVA) is a non-stock, non-profit corporation whose members are
homeowners in Bel-Air Village, a private subdivision in Makati City.
Respondent BAVA is the registered owner of Neptune Street, a road inside
Bel-Air Village.
On December 30, 1995, respondent received from petitioner, through its
Chairman, a notice dated December 22, 1995 requesting respondent to open
Neptune Street to public vehicular traffic starting January 2, 1996. The notice
reads: Court
"SUBJECT: NOTICE of the Opening of Neptune Street to Traffic
"Dear President Lindo,
"Please be informed that pursuant to the mandate of the MMDA law or
Republic Act No. 7924 which requires the Authority to rationalize the use of
roads and/or thoroughfares for the safe and convenient movement of
persons, Neptune Street shall be opened to vehicular traffic effective January
2, 1996.
"In view whereof, the undersigned requests you to voluntarily open the points
of entry and exit on said street.

On January 2, 1996, respondent instituted against petitioner before the

Regional Trial Court, Branch 136, Makati City, Civil Case No. 96-001 for
injunction. Respondent prayed for the issuance of a temporary restraining
order and preliminary injunction enjoining the opening of Neptune Street and
prohibiting the demolition of the perimeter wall. The trial court issued a
temporary restraining order the following day.
On January 23, 1996, after due hearing, the trial court denied issuance of a
preliminary injunction.[2] Respondent questioned the denial before the Court
of Appeals in CA-G.R. SP No. 39549. The appellate court conducted an
ocular inspection of Neptune Street[3] and on February 13, 1996, it issued a
writ of preliminary injunction enjoining the implementation of the MMDAs
proposed action.[4]
On January 28, 1997, the appellate court rendered a Decision on the merits
of the case finding that the MMDA has no authority to order the opening of
Neptune Street, a private subdivision road and cause the demolition of its
perimeter walls. It held that the authority is lodged in the City Council of
Makati by ordinance. The decision disposed of as follows: Jurissc
"WHEREFORE, the Petition is GRANTED; the challenged Order dated
January 23, 1995, in Civil Case No. 96-001, is SET ASIDE and the Writ of
Preliminary Injunction issued on February 13, 1996 is hereby made
permanent.
"For want of sustainable substantiation, the Motion to Cite Roberto L. del
Rosario in contempt is denied.[5]
"No pronouncement as to costs.

"Thank you for your cooperation and whatever assistance that may be
extended by your association to the MMDA personnel who will be directing
traffic in the area.

"SO ORDERED."[6]

The Motion for Reconsideration of the decision was denied on September

28, 1998. Hence, this recourse. Jksm
Petitioner MMDA raises the following questions:
"I
HAS THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY
(MMDA) THE MANDATE TO OPEN NEPTUNE STREET TO PUBLIC
TRAFFIC PURSUANT TO ITS REGULATORY AND POLICE POWERS?
II
IS THE PASSAGE OF AN ORDINANCE A CONDITION PRECEDENT
BEFORE THE MMDA MAY ORDER THE OPENING OF SUBDIVISION
ROADS TO PUBLIC TRAFFIC?
III
IS RESPONDENT BEL-AIR VILLAGE ASSOCIATION, INC. ESTOPPED
FROM DENYING OR ASSAILING THE AUTHORITY OF THE MMDA TO
OPEN THE SUBJECT STREET? Jlexj
V
WAS RESPONDENT DEPRIVED OF DUE PROCESS DESPITE THE
SEVERAL MEETINGS HELD BETWEEN MMDA AND THE AFFECTED
BEL-AIR RESIDENTS AND BAVA OFFICERS?
V
HAS RESPONDENT COME TO COURT WITH UNCLEAN HANDS?"[7]
Neptune Street is owned by respondent BAVA. It is a private road inside BelAir Village, a private residential subdivision in the heart of the financial and
commercial district of Makati City. It runs parallel to Kalayaan Avenue, a
national road open to the general public. Dividing the two (2) streets is a
concrete perimeter wall approximately fifteen (15) feet high. The western end
of Neptune Street intersects Nicanor Garcia, formerly Reposo Street, a
subdivision road open to public vehicular traffic, while its eastern end
intersects Makati Avenue, a national road. Both ends of Neptune Street are
guarded by iron gates. Edp mis
Petitioner MMDA claims that it has the authority to open Neptune Street to
public traffic because it is an agent of the state endowed with police power in
the delivery of basic services in Metro Manila. One of these basic services is

traffic management which involves the regulation of the use of thoroughfares

to insure the safety, convenience and welfare of the general public. It is
alleged that the police power of MMDA was affirmed by this Court in the
consolidated cases of Sangalang v. Intermediate Appellate Court.[8] From
the premise that it has police power, it is now urged that there is no need for
the City of Makati to enact an ordinance opening Neptune street to the
public.[9]
Police power is an inherent attribute of sovereignty. It has been defined as
the power vested by the Constitution in the legislature to make, ordain, and
establish all manner of wholesome and reasonable laws, statutes and
ordinances, either with penalties or without, not repugnant to the
Constitution, as they shall judge to be for the good and welfare of the
commonwealth, and for the subjects of the same.[10] The power is plenary
and its scope is vast and pervasive, reaching and justifying measures for
public health, public safety, public morals, and the general welfare.[11]
It bears stressing that police power is lodged primarily in the National
Legislature.[12] It cannot be exercised by any group or body of individuals
not possessing legislative power.[13] The National Legislature, however, may
delegate this power to the President and administrative boards as well as the
lawmaking bodies of municipal corporations or local government units.[14]
Once delegated, the agents can exercise only such legislative powers as are
conferred on them by the national lawmaking body.[15]
A local government is a "political subdivision of a nation or state which is
constituted by law and has substantial control of local affairs."[16] The Local
Government Code of 1991 defines a local government unit as a "body politic
and corporate"[17]-- one endowed with powers as a political subdivision of
the National Government and as a corporate entity representing the
inhabitants of its territory.[18] Local government units are the provinces,
cities, municipalities and barangays.[19] They are also the territorial and
political subdivisions of the state.[20]
Our Congress delegated police power to the local government units in the
Local Government Code of 1991. This delegation is found in Section 16 of
the same Code, known as the general welfare clause, viz: Chief
"Sec. 16. General Welfare.Every local government unit shall exercise the
powers expressly granted, those necessarily implied therefrom, as well as
powers necessary, appropriate, or incidental for its efficient and effective
governance, and those which are essential to the promotion of the general
welfare. Within their respective territorial jurisdictions, local government units
shall ensure and support, among other things, the preservation and
enrichment of culture, promote health and safety, enhance the right of the
people to a balanced ecology, encourage and support the development of

appropriate and self-reliant scientific and technological capabilities, improve

public morals, enhance economic prosperity and social justice, promote full
employment among their residents, maintain peace and order, and preserve
the comfort and convenience of their inhabitants."[21]
Local government units exercise police power through their respective
legislative bodies. The legislative body of the provincial government is the
sangguniang panlalawigan, that of the city government is the sangguniang
panlungsod, that of the municipal government is the sangguniang bayan, and
that of the barangay is the sangguniang barangay. The Local Government
Code of 1991 empowers the sangguniang panlalawigan, sangguniang
panlungsod and sangguniang bayan to "enact ordinances, approve
resolutions and appropriate funds for the general welfare of the [province,
city or municipality, as the case may be], and its inhabitants pursuant to
Section 16 of the Code and in the proper exercise of the corporate powers of
the [province, city municipality] provided under the Code x x x."[22] The
same Code gives the sangguniang barangay the power to "enact ordinances
as may be necessary to discharge the responsibilities conferred upon it by
law or ordinance and to promote the general welfare of the inhabitants
thereon."[23]
Metropolitan or Metro Manila is a body composed of several local
government units - i.e., twelve (12) cities and five (5) municipalities, namely,
the cities of Caloocan, Manila, Mandaluyong, Makati, Pasay, Pasig, Quezon,
Muntinlupa, Las Pinas, Marikina, Paranaque and Valenzuela, and the
municipalities of Malabon, , Navotas, , Pateros, San Juan and Taguig. With
the passage of Republic Act (R. A.) No. 7924[24] in 1995, Metropolitan
Manila was declared as a "special development and administrative region"
and the Administration of "metro-wide" basic services affecting the region
placed under "a development authority" referred to as the MMDA.[25]
"Metro-wide services" are those "services which have metro-wide impact and
transcend local political boundaries or entail huge expenditures such that it
would not be viable for said services to be provided by the individual local
government units comprising Metro Manila."[26] There are seven (7) basic
metro-wide services and the scope of these services cover the following: (1)
development planning; (2) transport and traffic management; (3) solid waste
disposal and management; (4) flood control and sewerage management; (5)
urban renewal, zoning and land use planning, and shelter services; (6) health
and sanitation, urban protection and pollution control; and (7) public safety.
The basic service of transport and traffic management includes the following:
Lexjuris
"(b) Transport and traffic management which include the formulation,
coordination, and monitoring of policies, standards, programs and projects to
rationalize the existing transport operations, infrastructure requirements, the

use of thoroughfares, and promotion of safe and convenient movement of

persons and goods; provision for the mass transport system and the
institution of a system to regulate road users; administration and
implementation of all traffic enforcement operations, traffic engineering
services and traffic education programs, including the institution of a single
ticketing system in Metropolitan Manila;"[27]
In the delivery of the seven (7) basic services, the MMDA has the following
powers and functions: Esm
"Sec. 5. Functions and powers of the Metro Manila Development
Authority.The MMDA shall:
(a) Formulate, coordinate and regulate the implementation of medium and
long-term plans and programs for the delivery of metro-wide services, land
use and physical development within Metropolitan Manila, consistent with
national development objectives and priorities;
(b) Prepare, coordinate and regulate the implementation of medium-term
investment programs for metro-wide services which shall indicate sources
and uses of funds for priority programs and projects, and which shall include
the packaging of projects and presentation to funding institutions; Esmsc
(c) Undertake and manage on its own metro-wide programs and projects for
the delivery of specific services under its jurisdiction, subject to the approval
of the Council. For this purpose, MMDA can create appropriate project
management offices;
(d) Coordinate and monitor the implementation of such plans, programs and
projects in Metro Manila; identify bottlenecks and adopt solutions to problems
of implementation;
(e) The MMDA shall set the policies concerning traffic in Metro Manila, and
shall coordinate and regulate the implementation of all programs and projects
concerning traffic management, specifically pertaining to enforcement,
engineering and education. Upon request, it shall be extended assistance
and cooperation, including but not limited to, assignment of personnel, by all
other government agencies and offices concerned;
(f) Install and administer a single ticketing system, fix, impose and collect
fines and penalties for all kinds of violations of traffic rules and regulations,
whether moving or non-moving in nature, and confiscate and suspend or
revoke drivers licenses in the enforcement of such traffic laws and
regulations, the provisions of RA 4136 and PD 1605 to the contrary
notwithstanding. For this purpose, the Authority shall impose all traffic laws
and regulations in Metro Manila, through its traffic operation center, and may

deputize members of the PNP, traffic enforcers of local government units,

duly licensed security guards, or members of non-governmental
organizations to whom may be delegated certain authority, subject to such
conditions and requirements as the Authority may impose; and

(d) It shall promulgate rules and regulations and set policies and standards
for metro-wide application governing the delivery of basic services, prescribe
and collect service and regulatory fees, and impose and collect fines and
penalties." Jj sc

(g) Perform other related functions required to achieve the objectives of the
MMDA, including the undertaking of delivery of basic services to the local
government units, when deemed necessary subject to prior coordination with
and consent of the local government unit concerned." Jurismis

Clearly, the scope of the MMDAs function is limited to the delivery of the
seven (7) basic services. One of these is transport and traffic management
which includes the formulation and monitoring of policies, standards and
projects to rationalize the existing transport operations, infrastructure
requirements, the use of thoroughfares and promotion of the safe movement
of persons and goods. It also covers the mass transport system and the
institution of a system of road regulation, the administration of all traffic
enforcement operations, traffic engineering services and traffic education
programs, including the institution of a single ticketing system in Metro
Manila for traffic violations. Under this service, the MMDA is expressly
authorized "to set the policies concerning traffic" and "coordinate and
regulate the implementation of all traffic management programs." In addition,
the MMDA may "install and administer a single ticketing system," fix, impose
and collect fines and penalties for all traffic violations. Ca-lrsc

The implementation of the MMDAs plans, programs and projects is

undertaken by the local government units, national government agencies,
accredited peoples organizations, non-governmental organizations, and the
private sector as well as by the MMDA itself. For this purpose, the MMDA
has the power to enter into contracts, memoranda of agreement and other
cooperative arrangements with these bodies for the delivery of the required
services within Metro Manila.[28]
The governing board of the MMDA is the Metro Manila Council. The Council
is composed of the mayors of the component 12 cities and 5 municipalities,
the president of the Metro Manila Vice-Mayors League and the president of
the Metro Manila Councilors League.[29] The Council is headed by a
Chairman who is appointed by the President and vested with the rank of
cabinet member. As the policy-making body of the MMDA, the Metro Manila
Council approves metro-wide plans, programs and projects, and issues the
necessary rules and regulations for the implementation of said plans; it
approves the annual budget of the MMDA and promulgates the rules and
regulations for the delivery of basic services, collection of service and
regulatory fees, fines and penalties. These functions are particularly
enumerated as follows: LEX
"Sec. 6. Functions of the Metro Manila Council. (a) The Council shall be the policy-making body of the MMDA;
(b) It shall approve metro-wide plans, programs and projects and issue rules
and regulations deemed necessary by the MMDA to carry out the purposes
of this Act;
(c) It may increase the rate of allowances and per diems of the members of
the Council to be effective during the term of the succeeding Council. It shall
fix the compensation of the officers and personnel of the MMDA, and
approve the annual budget thereof for submission to the Department of
Budget and Management (DBM);

It will be noted that the powers of the MMDA are limited to the following acts:
formulation,
coordination,
regulation,
implementation,
preparation,
management, monitoring, setting of policies, installation of a system and
administration. There is no syllable in R. A. No. 7924 that grants the MMDA
police power, let alone legislative power. Even the Metro Manila Council has
not been delegated any legislative power. Unlike the legislative bodies of the
local government units, there is no provision in R. A. No. 7924 that
empowers the MMDA or its Council to "enact ordinances, approve
resolutions and appropriate funds for the general welfare" of the inhabitants
of Metro Manila. The MMDA is, as termed in the charter itself, a
"development authority."[30] It is an agency created for the purpose of laying
down policies and coordinating with the various national government
agencies, peoples organizations, non-governmental organizations and the
private sector for the efficient and expeditious delivery of basic services in
the vast metropolitan area. All its functions are administrative in nature and
these are actually summed up in the charter itself, viz:
"Sec. 2. Creation of the Metropolitan Manila Development Authority. -- x x x.
The MMDA shall perform planning, monitoring and coordinative functions,
and in the process exercise regulatory and supervisory authority over the
delivery of metro-wide services within Metro Manila, without diminution of the
autonomy of the local government units concerning purely local matters."[31]
Petitioner cannot seek refuge in the cases of Sangalang v. Intermediate
Appellate Court[32] where we upheld a zoning ordinance issued by the Metro

Manila Commission (MMC), the predecessor of the MMDA, as an exercise of

police power. The first Sangalang decision was on the merits of the
petition,[33] while the second decision denied reconsideration of the first
case and in addition discussed the case of Yabut v. Court of Appeals.[34]
Sangalang v. IAC involved five (5) consolidated petitions filed by respondent
BAVA and three residents of Bel-Air Village against other residents of the
Village and the Ayala Corporation, formerly the Makati Development
Corporation, as the developer of the subdivision. The petitioners sought to
enforce certain restrictive easements in the deeds of sale over their
respective lots in the subdivision. These were the prohibition on the setting
up of commercial and advertising signs on the lots, and the condition that the
lots be used only for residential purposes. Petitioners alleged that
respondents, who were residents along Jupiter Street of the subdivision,
converted their residences into commercial establishments in violation of the
"deed restrictions," and that respondent Ayala Corporation ushered in the full
commercialization" of Jupiter Street by tearing down the perimeter wall that
separated the commercial from the residential section of the village.[35]
The petitions were dismissed based on Ordinance No. 81 of the Municipal
Council of Makati and Ordinance No. 81-01 of the Metro Manila Commission
(MMC). Municipal Ordinance No. 81 classified Bel-Air Village as a Class A
Residential Zone, with its boundary in the south extending to the center line
of Jupiter Street. The Municipal Ordinance was adopted by the MMC under
the Comprehensive Zoning Ordinance for the National Capital Region and
promulgated as MMC Ordinance No. 81-01. Bel-Air Village was indicated
therein as bounded by Jupiter Street and the block adjacent thereto was
classified as a High Intensity Commercial Zone.[36]
We ruled that since both Ordinances recognized Jupiter Street as the
boundary between Bel-Air Village and the commercial district, Jupiter Street
was not for the exclusive benefit of Bel-Air residents. We also held that the
perimeter wall on said street was constructed not to separate the residential
from the commercial blocks but simply for security reasons, hence, in tearing
down said wall, Ayala Corporation did not violate the "deed restrictions" in
the deeds of sale. Scc-alr
We upheld the ordinances, specifically MMC Ordinance No. 81-01, as a
legitimate exercise of police power.[37] The power of the MMC and the
Makati Municipal Council to enact zoning ordinances for the general welfare
prevailed over the "deed restrictions".
In the second Sangalang/Yabut decision, we held that the opening of Jupiter
Street was warranted by the demands of the common good in terms of
"traffic decongestion and public convenience." Jupiter was opened by the
Municipal Mayor to alleviate traffic congestion along the public streets

adjacent to the Village.[38] The same reason was given for the opening to
public vehicular traffic of Orbit Street, a road inside the same village. The
destruction of the gate in Orbit Street was also made under the police power
of the municipal government. The gate, like the perimeter wall along Jupiter,
was a public nuisance because it hindered and impaired the use of property,
hence, its summary abatement by the mayor was proper and legal.[39]
Contrary to petitioners claim, the two Sangalang cases do not apply to the
case at bar. Firstly, both involved zoning ordinances passed by the municipal
council of Makati and the MMC. In the instant case, the basis for the
proposed opening of Neptune Street is contained in the notice of December
22, 1995 sent by petitioner to respondent BAVA, through its president. The
notice does not cite any ordinance or law, either by the Sangguniang
Panlungsod of Makati City or by the MMDA, as the legal basis for the
proposed opening of Neptune Street. Petitioner MMDA simply relied on its
authority under its charter "to rationalize the use of roads and/or
thoroughfares for the safe and convenient movement of persons."
Rationalizing the use of roads and thoroughfares is one of the acts that fall
within the scope of transport and traffic management. By no stretch of the
imagination, however, can this be interpreted as an express or implied grant
of ordinance-making power, much less police power. Misjuris
Secondly, the MMDA is not the same entity as the MMC in Sangalang.
Although the MMC is the forerunner of the present MMDA, an examination of
Presidential Decree (P. D.) No. 824, the charter of the MMC, shows that the
latter possessed greater powers which were not bestowed on the present
MMDA. Jjlex
Metropolitan Manila was first created in 1975 by Presidential Decree (P.D.)
No. 824. It comprised the Greater Manila Area composed of the contiguous
four (4) cities of Manila, Quezon, Pasay and Caloocan, and the thirteen (13)
municipalities of Makati, Mandaluyong, San Juan, Las Pinas, Malabon,
Navotas, Pasig, Pateros, Paranaque, Marikina, Muntinlupa and Taguig in the
province of Rizal, and Valenzuela in the province of Bulacan.[40]
Metropolitan Manila was created as a response to the finding that the rapid
growth of population and the increase of social and economic requirements
in these areas demand a call for simultaneous and unified development; that
the public services rendered by the respective local governments could be
administered more efficiently and economically if integrated under a system
of central planning; and this coordination, "especially in the maintenance of
peace and order and the eradication of social and economic ills that fanned
the flames of rebellion and discontent [were] part of reform measures under
Martial Law essential to the safety and security of the State."[41]
Metropolitan Manila was established as a "public corporation" with the
following powers: Calrs-pped

"Section 1. Creation of the Metropolitan Manila.There is hereby created a

public corporation, to be known as the Metropolitan Manila, vested with
powers and attributes of a corporation including the power to make contracts,
sue and be sued, acquire, purchase, expropriate, hold, transfer and dispose
of property and such other powers as are necessary to carry out its
purposes. The Corporation shall be administered by a Commission created
under this Decree."[42]

10. To establish and operate a transport and traffic center, which shall direct
traffic activities; Jjjuris

The administration of Metropolitan Manila was placed under the Metro Manila
Commission (MMC) vested with the following powers:

12. To insure and monitor the undertaking of a comprehensive social,

economic and physical planning and development of the area;

"Sec. 4. Powers and Functions of the Commission. - The Commission shall

have the following powers and functions:

13. To study the feasibility of increasing barangay participation in the affairs

of their respective local governments and to propose to the President of the
Philippines definite programs and policies for implementation;

1. To act as a central government to establish and administer programs and

provide services common to the area;
2. To levy and collect taxes and special assessments, borrow and expend
money and issue bonds, revenue certificates, and other obligations of
indebtedness. Existing tax measures should, however, continue to be
operative until otherwise modified or repealed by the Commission;
3. To charge and collect fees for the use of public service facilities;
4. To appropriate money for the operation of the metropolitan government
and review appropriations for the city and municipal units within its
jurisdiction with authority to disapprove the same if found to be not in
accordance with the established policies of the Commission, without
prejudice to any contractual obligation of the local government units involved
existing at the time of approval of this Decree;
5. To review, amend, revise or repeal all ordinances, resolutions and acts of
cities and municipalities within Metropolitan Manila;
6. To enact or approve ordinances, resolutions and to fix penalties for any
violation thereof which shall not exceed a fine of P10,000.00 or imprisonment
of six years or both such fine and imprisonment for a single offense;
7. To perform general administrative, executive and policy-making functions;
8. To establish a fire control operation center, which shall direct the fire
services of the city and municipal governments in the metropolitan area;
9. To establish a garbage disposal operation center, which shall direct
garbage collection and disposal in the metropolitan area;

11. To coordinate and monitor governmental and private activities pertaining

to essential services such as transportation, flood control and drainage,
water supply and sewerage, social, health and environmental services,
housing, park development, and others;

14. To submit within thirty (30) days after the close of each fiscal year an
annual report to the President of the Philippines and to submit a periodic
report whenever deemed necessary; and
15. To perform such other tasks as may be assigned or directed by the
President of the Philippines." Sc jj
The MMC was the "central government" of Metro Manila for the purpose of
establishing and administering programs providing services common to the
area. As a "central government" it had the power to levy and collect taxes
and special assessments, the power to charge and collect fees; the power to
appropriate money for its operation, and at the same time, review
appropriations for the city and municipal units within its jurisdiction. It was
bestowed the power to enact or approve ordinances, resolutions and fix
penalties for violation of such ordinances and resolutions. It also had the
power to review, amend, revise or repeal all ordinances, resolutions and acts
of any of the four (4) cities and thirteen (13) municipalities comprising Metro
Manila.
P. D. No. 824 further provided:
"Sec. 9. Until otherwise provided, the governments of the four cities and
thirteen municipalities in the Metropolitan Manila shall continue to exist in
their present form except as may be inconsistent with this Decree. The
members of the existing city and municipal councils in Metropolitan Manila
shall, upon promulgation of this Decree, and until December 31, 1975,
become members of the Sangguniang Bayan which is hereby created for
every city and municipality of Metropolitan Manila.

In addition, the Sangguniang Bayan shall be composed of as many barangay

captains as may be determined and chosen by the Commission, and such
number of representatives from other sectors of the society as may be
appointed by the President upon recommendation of the Commission.
x x x.
The Sangguniang Bayan may recommend to the Commission ordinances,
resolutions or such measures as it may adopt; Provided, that no such
ordinance, resolution or measure shall become effective, until after its
approval by the Commission; and Provided further, that the power to impose
taxes and other levies, the power to appropriate money and the power to
pass ordinances or resolutions with penal sanctions shall be vested
exclusively in the Commission."
The creation of the MMC also carried with it the creation of the Sangguniang
Bayan. This was composed of the members of the component city and
municipal councils, barangay captains chosen by the MMC and sectoral
representatives appointed by the President. The Sangguniang Bayan had the
power to recommend to the MMC the adoption of ordinances, resolutions or
measures. It was the MMC itself, however, that possessed legislative
powers. All ordinances, resolutions and measures recommended by the
Sangguniang Bayan were subject to the MMCs approval. Moreover, the
power to impose taxes and other levies, the power to appropriate money,
and the power to pass ordinances or resolutions with penal sanctions were
vested exclusively in the MMC. Sce-dp
Thus, Metropolitan Manila had a "central government," i.e., the MMC which
fully possessed legislative and police powers. Whatever legislative powers
the component cities and municipalities had were all subject to review and
approval by the MMC.
After President Corazon Aquino assumed power, there was a clamor to
restore the autonomy of the local government units in Metro Manila. Hence,
Sections 1 and 2 of Article X of the 1987 Constitution provided: Sj cj
"Section 1. The territorial and political subdivisions of the Republic of the
Philippines are the provinces, cities, municipalities and barangays. There
shall be autonomous regions in Muslim Mindanao and the Cordilleras as
herein provided.
Section 2. The territorial and political subdivisions shall enjoy local
autonomy."
The Constitution, however, recognized the necessity of creating metropolitan
regions not only in the existing National Capital Region but also in potential

equivalents in the Visayas and Mindanao.[43] Section 11 of the same Article

X thus provided:
"Section 11. The Congress may, by law, create special metropolitan political
subdivisions, subject to a plebiscite as set forth in Section 10 hereof. The
component cities and municipalities shall retain their basic autonomy and
shall be entitled to their own local executives and legislative assemblies. The
jurisdiction of the metropolitan authority that will thereby be created shall be
limited to basic services requiring coordination."
The Constitution itself expressly provides that Congress may, by law, create
"special metropolitan political subdivisions" which shall be subject to approval
by a majority of the votes cast in a plebiscite in the political units directly
affected; the jurisdiction of this subdivision shall be limited to basic services
requiring coordination; and the cities and municipalities comprising this
subdivision shall retain their basic autonomy and their own local executive
and legislative assemblies.[44] Pending enactment of this law, the Transitory
Provisions of the Constitution gave the President of the Philippines the power
to constitute the Metropolitan Authority, viz:
"Section 8. Until otherwise provided by Congress, the President may
constitute the Metropolitan Authority to be composed of the heads of all local
government units comprising the Metropolitan Manila area."[45]
In 1990, President Aquino issued Executive Order (E. O.) No. 392 and
constituted the Metropolitan Manila Authority (MMA). The powers and
functions of the MMC were devolved to the MMA.[46] It ought to be stressed,
however, that not all powers and functions of the MMC were passed to the
MMA. The MMAs power was limited to the "delivery of basic urban services
requiring coordination in Metropolitan Manila."[47] The MMAs governing
body, the Metropolitan Manila Council, although composed of the mayors of
the component cities and municipalities, was merely given the power of: (1)
formulation of policies on the delivery of basic services requiring coordination
and consolidation; and (2) promulgation of resolutions and other issuances,
approval of a code of basic services and the exercise of its rule-making
power.[48]
Under the 1987 Constitution, the local government units became primarily
responsible for the governance of their respective political subdivisions. The
MMAs jurisdiction was limited to addressing common problems involving
basic services that transcended local boundaries. It did not have legislative
power. Its power was merely to provide the local government units technical
assistance in the preparation of local development plans. Any semblance of
legislative power it had was confined to a "review [of] legislation proposed by
the local legislative assemblies to ensure consistency among local

governments and with the comprehensive development plan of Metro

Manila," and to "advise the local governments accordingly."[49]
When R.A. No. 7924 took effect, Metropolitan Manila became a "special
development and administrative region" and the MMDA a "special
development authority" whose functions were "without prejudice to the
autonomy of the affected local government units." The character of the
MMDA was clearly defined in the legislative debates enacting its charter.
R. A. No. 7924 originated as House Bill No. 14170/ 11116 and was
introduced by several legislators led by Dante Tinga, Roilo Golez and
Feliciano Belmonte. It was presented to the House of Representatives by the
Committee on Local Governments chaired by Congressman Ciriaco R.
Alfelor. The bill was a product of Committee consultations with the local
government units in the National Capital Region (NCR), with former
Chairmen of the MMC and MMA,[50] and career officials of said agencies.
When the bill was first taken up by the Committee on Local Governments,
the following debate took place:
"THE CHAIRMAN [Hon. Ciriaco Alfelor]: Okay, Let me explain. This has
been debated a long time ago, you know. Its a special we can create a
special metropolitan political subdivision. Supreme
Actually, there are only six (6) political subdivisions provided for in the
Constitution: barangay, municipality, city, province, and we have the
Autonomous Region of Mindanao and we have the Cordillera. So we have 6.
Now.
HON. [Elias] LOPEZ: May I interrupt, Mr. Chairman. In the case of the
Autonomous Region, that is also specifically mandated by the Constitution.
THE CHAIRMAN: Thats correct. But it is considered to be a political
subdivision. What is the meaning of a political subdivision? Meaning to say,
that it has its own government, it has its own political personality, it has the
power to tax, and all governmental powers: police power and everything. All
right. Authority is different; because it does not have its own government. It is
only a council, it is an organization of political subdivision, powers, no, which
is not imbued with any political power. Esmmis
If you go over Section 6, where the powers and functions of the Metro Manila
Development Authority, it is purely coordinative. And it provides here that the
council is policy-making. All right.
Under the Constitution is a Metropolitan Authority with coordinative power.
Meaning to say, it coordinates all of the different basic services which have to
be delivered to the constituency. All right.

There is now a problem. Each local government unit is given its respective as
a political subdivision. Kalookan has its powers, as provided for and
protected and guaranteed by the Constitution. All right, the exercise.
However, in the exercise of that power, it might be deleterious and
disadvantageous to other local government units. So, we are forming an
authority where all of these will be members and then set up a policy in order
that the basic services can be effectively coordinated. All right. justice
Of course, we cannot deny that the MMDA has to survive. We have to
provide some funds, resources. But it does not possess any political power.
We do not elect the Governor. We do not have the power to tax. As a matter
of fact, I was trying to intimate to the author that it must have the power to
sue and be sued because it coordinates. All right. It coordinates practically all
these basic services so that the flow and the distribution of the basic services
will be continuous. Like traffic, we cannot deny that. Its before our eyes.
Sewerage, flood control, water system, peace and order, we cannot deny
these. Its right on our face. We have to look for a solution. What would be the
right solution? All right, we envision that there should be a coordinating
agency and it is called an authority. All right, if you do not want to call it an
authority, its alright. We may call it a council or maybe a management
agency.
x x x."[51]
Clearly, the MMDA is not a political unit of government. The power delegated
to the MMDA is that given to the Metro Manila Council to promulgate
administrative rules and regulations in the implementation of the MMDAs
functions. There is no grant of authority to enact ordinances and regulations
for the general welfare of the inhabitants of the metropolis. This was explicitly
stated in the last Committee deliberations prior to the bills presentation to
Congress. Thus: Ed-p
"THE CHAIRMAN: Yeah, but we have to go over the suggested revision. I
think this was already approved before, but it was reconsidered in view of the
proposals, set-up, to make the MMDA stronger. Okay, so if there is no
objection to paragraph "f" And then next is paragraph "b," under Section 6. "It
shall approve metro-wide plans, programs and projects and issue ordinances
or resolutions deemed necessary by the MMDA to carry out the purposes of
this Act." Do you have the powers? Does the MMDA because that takes the
form of a local government unit, a political subdivision.
HON. [Feliciano] BELMONTE: Yes, I believe so, your Honor. When we say
that it has the policies, its very clear that those policies must be followed.
Otherwise, whats the use of empowering it to come out with policies. Now,
the policies may be in the form of a resolution or it may be in the form of a

ordinance. The term "ordinance" in this case really gives it more teeth, your
honor. Otherwise, we are going to see a situation where you have the power
to adopt the policy but you cannot really make it stick as in the case now, and
I think here is Chairman Bunye. I think he will agree that that is the case now.
Youve got the power to set a policy, the body wants to follow your policy,
then we say lets call it an ordinance and see if they will not follow it.

introduced. The bill was approved on second reading on the same day it was
presented.[54]

THE CHAIRMAN: Thats very nice. I like that. However, there is a

constitutional impediment. You are making this MMDA a political subdivision.
The creation of the MMDA would be subject to a plebiscite. That is what Im
trying to avoid. Ive been trying to avoid this kind of predicament. Under the
Constitution it states: if it is a political subdivision, once it is created it has to
be subject to a plebiscite. Im trying to make this as administrative. Thats why
we place the Chairman as a cabinet rank.

It is thus beyond doubt that the MMDA is not a local government unit or a
public corporation endowed with legislative power. It is not even a "special
metropolitan political subdivision" as contemplated in Section 11, Article X of
the Constitution. The creation of a "special metropolitan political subdivision"
requires the approval by a majority of the votes cast in a plebiscite in the
political units directly affected.[56] R. A. No. 7924 was not submitted to the
inhabitants of Metro Manila in a plebiscite. The Chairman of the MMDA is not
an official elected by the people, but appointed by the President with the rank
and privileges of a cabinet member. In fact, part of his function is to perform
such other duties as may be assigned to him by the President,[57] whereas
in local government units, the President merely exercises supervisory
authority. This emphasizes the administrative character of the MMDA.
Newmiso

HON. BELMONTE: All right, Mr. Chairman, okay, what you are saying there
is .
THE CHAIRMAN: In setting up ordinances, it is a political exercise. Believe
me.
HON. [Elias] LOPEZ: Mr. Chairman, it can be changed into issuances of
rules and regulations. That would be it shall also be enforced. Jksm
HON. BELMONTE: Okay, I will .
HON. LOPEZ: And you can also say that violation of such rule, you impose a
sanction. But you know, ordinance has a different legal connotation.
HON. BELMONTE: All right. I defer to that opinion, your Honor. sc
THE CHAIRMAN: So instead of ordinances, say rules and regulations.
HON. BELMONTE: Or resolutions. Actually, they are actually considering
resolutions now.
THE CHAIRMAN: Rules and resolutions.
HON. BELMONTE: Rules, regulations and resolutions."[52]
The draft of H. B. No. 14170/ 11116 was presented by the Committee to the
House of Representatives. The explanatory note to the bill stated that the
proposed MMDA is a "development authority" which is a "national agency,
not a political government unit."[53] The explanatory note was adopted as
the sponsorship speech of the Committee on Local Governments. No
interpellations or debates were made on the floor and no amendments

When the bill was forwarded to the Senate, several amendments were made.
These amendments, however, did not affect the nature of the MMDA as
originally conceived in the House of Representatives.[55]

Clearly then, the MMC under P. D. No. 824 is not the same entity as the
MMDA under R. A. No. 7924. Unlike the MMC, the MMDA has no power to
enact ordinances for the welfare of the community. It is the local government
units, acting through their respective legislative councils, that possess
legislative power and police power. In the case at bar, the Sangguniang
Panlungsod of Makati City did not pass any ordinance or resolution ordering
the opening of Neptune Street, hence, its proposed opening by petitioner
MMDA is illegal and the respondent Court of Appeals did not err in so ruling.
We desist from ruling on the other issues as they are unnecessary. Esmso
We stress that this decision does not make light of the MMDAs noble efforts
to solve the chaotic traffic condition in Metro Manila. Everyday, traffic jams
and traffic bottlenecks plague the metropolis. Even our once sprawling
boulevards and avenues are now crammed with cars while city streets are
clogged with motorists and pedestrians. Traffic has become a social malaise
affecting our peoples productivity and the efficient delivery of goods and
services in the country. The MMDA was created to put some order in the
metropolitan transportation system but unfortunately the powers granted by
its charter are limited. Its good intentions cannot justify the opening for public
use of a private street in a private subdivision without any legal warrant. The
promotion of the general welfare is not antithetical to the preservation of the
rule of law. Sdjad

[G.R. No. 130230. April 15, 2005]

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs.
DANTE O. GARIN, respondent.

In support of his application for a writ of preliminary injunction, Garin alleged

that he suffered and continues to suffer great and irreparable damage
because of the deprivation of his license and that, absent any implementing
rules from the Metro Manila Council, the TVR and the confiscation of his
license have no legal basis.

DECISION
CHICO-NAZARIO, J.:
At issue in this case is the validity of Section 5(f) of Republic Act No. 7924
creating the Metropolitan Manila Development Authority (MMDA), which
authorizes it to confiscate and suspend or revoke drivers licenses in the
enforcement of traffic laws and regulations.
The issue arose from an incident involving the respondent Dante O. Garin, a
lawyer, who was issued a traffic violation receipt (TVR) and his drivers
license confiscated for parking illegally along Gandara Street, Binondo,
Manila, on 05 August 1995. The following statements were printed on the
TVR:
YOU ARE HEREBY DIRECTED TO REPORT TO THE MMDA TRAFFIC
OPERATIONS CENTER PORT AREA MANILA AFTER 48 HOURS FROM
DATE OF APPREHENSION FOR DISPOSITION/APPROPRIATE ACTION
THEREON. CRIMINAL CASE SHALL BE FILED FOR FAILURE TO
REDEEM LICENSE AFTER 30 DAYS.
VALID AS TEMPORARY DRIVERS LICENSE FOR SEVEN DAYS FROM
DATE OF APPREHENSION.[1]
Shortly before the expiration of the TVRs validity, the respondent addressed
a letter[2] to then MMDA Chairman Prospero Oreta requesting the return of
his drivers license, and expressing his preference for his case to be filed in
court.
Receiving no immediate reply, Garin filed the original complaint[3] with
application for preliminary injunction in Branch 260 of the Regional Trial
Court (RTC) of Paraaque, on 12 September 1995, contending that, in the
absence of any implementing rules and regulations, Sec. 5(f) of Rep. Act No.
7924 grants the MMDA unbridled discretion to deprive erring motorists of
their licenses, pre-empting a judicial determination of the validity of the
deprivation, thereby violating the due process clause of the Constitution. The
respondent further contended that the provision violates the constitutional
prohibition against undue delegation of legislative authority, allowing as it
does the MMDA to fix and impose unspecified and therefore unlimited - fines
and other penalties on erring motorists.

For its part, the MMDA, represented by the Office of the Solicitor General,
pointed out that the powers granted to it by Sec. 5(f) of Rep. Act No. 7924
are limited to the fixing, collection and imposition of fines and penalties for
traffic violations, which powers are legislative and executive in nature; the
judiciary retains the right to determine the validity of the penalty imposed. It
further argued that the doctrine of separation of powers does not preclude
admixture of the three powers of government in administrative agencies.[4]
The MMDA also refuted Garins allegation that the Metro Manila Council, the
governing board and policy making body of the petitioner, has as yet to
formulate the implementing rules for Sec. 5(f) of Rep. Act No. 7924 and
directed the courts attention to MMDA Memorandum Circular No. TT-95-001
dated 15 April 1995. Respondent Garin, however, questioned the validity of
MMDA Memorandum Circular No. TT-95-001, as he claims that it was
passed by the Metro Manila Council in the absence of a quorum.
Judge Helen Bautista-Ricafort issued a temporary restraining order on 26
September 1995, extending the validity of the TVR as a temporary drivers
license for twenty more days. A preliminary mandatory injunction was
granted on 23 October 1995, and the MMDA was directed to return the
respondents drivers license.
On 14 August 1997, the trial court rendered the assailed decision[5] in favor
of the herein respondent and held that:
a. There was indeed no quorum in that First Regular Meeting of the MMDA
Council held on March 23, 1995, hence MMDA Memorandum Circular No.
TT-95-001, authorizing confiscation of drivers licenses upon issuance of a
TVR, is void ab initio.
b. The summary confiscation of a drivers license without first giving the driver
an opportunity to be heard; depriving him of a property right (drivers license)
without DUE PROCESS; not filling (sic) in Court the complaint of supposed
traffic infraction, cannot be justified by any legislation (and is) hence
unconstitutional.
WHEREFORE, the temporary writ of preliminary injunction is hereby made
permanent; th(e) MMDA is directed to return to plaintiff his drivers license;
th(e) MMDA is likewise ordered to desist from confiscating drivers license

without first giving the driver the opportunity to be heard in an appropriate

proceeding.

rendered moot and academic by the implementation of Memorandum

Circular No. 04, Series of 2004.

In filing this petition,[6] the MMDA reiterates and reinforces its argument in
the court below and contends that a license to operate a motor vehicle is
neither a contract nor a property right, but is a privilege subject to reasonable
regulation under the police power in the interest of the public safety and
welfare. The petitioner further argues that revocation or suspension of this
privilege does not constitute a taking without due process as long as the
licensee is given the right to appeal the revocation.

The petitioner, however, is not precluded from re-implementing

Memorandum Circular No. TT-95-001, or any other scheme, for that matter,
that would entail confiscating drivers licenses. For the proper implementation,
therefore, of the petitioners future programs, this Court deems it appropriate
to make the following observations:

To buttress its argument that a licensee may indeed appeal the taking and
the judiciary retains the power to determine the validity of the confiscation,
suspension or revocation of the license, the petitioner points out that under
the terms of the confiscation, the licensee has three options:
1. To voluntarily pay the imposable fine,
2. To protest the apprehension by filing a protest with the MMDA
Adjudication Committee, or

1. A license to operate a motor vehicle is a privilege that the state may

withhold in the exercise of its police power.
The petitioner correctly points out that a license to operate a motor vehicle is
not a property right, but a privilege granted by the state, which may be
suspended or revoked by the state in the exercise of its police power, in the
interest of the public safety and welfare, subject to the procedural due
process requirements. This is consistent with our rulings in Pedro v.
Provincial Board of Rizal[8] on the license to operate a cockpit, Tan v.
Director of Forestry[9] and Oposa v. Factoran[10] on timber licensing
agreements, and Surigao Electric Co., Inc. v. Municipality of Surigao[11] on a
legislative franchise to operate an electric plant.

3. To request the referral of the TVR to the Public Prosecutors Office.

The MMDA likewise argues that Memorandum Circular No. TT-95-001 was
validly passed in the presence of a quorum, and that the lower courts finding
that it had not was based on a misapprehension of facts, which the petitioner
would have us review. Moreover, it asserts that though the circular is the
basis for the issuance of TVRs, the basis for the summary confiscation of
licenses is Sec. 5(f) of Rep. Act No. 7924 itself, and that such power is selfexecutory and does not require the issuance of any implementing regulation
or circular.
Meanwhile, on 12 August 2004, the MMDA, through its Chairman Bayani
Fernando, implemented Memorandum Circular No. 04, Series of 2004,
outlining the procedures for the use of the Metropolitan Traffic Ticket (MTT)
scheme. Under the circular, erring motorists are issued an MTT, which can
be paid at any Metrobank branch. Traffic enforcers may no longer confiscate
drivers licenses as a matter of course in cases of traffic violations. All
motorists with unredeemed TVRs were given seven days from the date of
implementation of the new system to pay their fines and redeem their license
or vehicle plates.[7]
It would seem, therefore, that insofar as the absence of a prima facie case to
enjoin the petitioner from confiscating drivers licenses is concerned, recent
events have overtaken the Courts need to decide this case, which has been

Petitioner cites a long list of American cases to prove this point, such as
State ex. Rel. Sullivan,[12] which states in part that, the legislative power to
regulate travel over the highways and thoroughfares of the state for the
general welfare is extensive. It may be exercised in any reasonable manner
to conserve the safety of travelers and pedestrians. Since motor vehicles are
instruments of potential danger, their registration and the licensing of their
operators have been required almost from their first appearance. The right to
operate them in public places is not a natural and unrestrained right, but a
privilege subject to reasonable regulation, under the police power, in the
interest of the public safety and welfare. The power to license imports further
power to withhold or to revoke such license upon noncompliance with
prescribed conditions.
Likewise, the petitioner quotes the Pennsylvania Supreme Court in
Commonwealth v. Funk,[13] to the effect that: Automobiles are vehicles of
great speed and power. The use of them constitutes an element of danger to
persons and property upon the highways. Carefully operated, an automobile
is still a dangerous instrumentality, but, when operated by careless or
incompetent persons, it becomes an engine of destruction. The Legislature,
in the exercise of the police power of the commonwealth, not only may, but
must, prescribe how and by whom motor vehicles shall be operated on the
highways. One of the primary purposes of a system of general regulation of
the subject matter, as here by the Vehicle Code, is to insure the competency

of the operator of motor vehicles. Such a general law is manifestly directed to

the promotion of public safety and is well within the police power.
The common thread running through the cited cases is that it is the
legislature, in the exercise of police power, which has the power and
responsibility to regulate how and by whom motor vehicles may be operated
on the state highways.
2. The MMDA is not vested with police power.
In Metro Manila Development Authority v. Bel-Air Village Association,
Inc.,[14] we categorically stated that Rep. Act No. 7924 does not grant the
MMDA with police power, let alone legislative power, and that all its functions
are administrative in nature.
The said case also involved the herein petitioner MMDA which claimed that it
had the authority to open a subdivision street owned by the Bel-Air Village
Association, Inc. to public traffic because it is an agent of the state endowed
with police power in the delivery of basic services in Metro Manila. From this
premise, the MMDA argued that there was no need for the City of Makati to
enact an ordinance opening Neptune Street to the public.
Tracing the legislative history of Rep. Act No. 7924 creating the MMDA, we
concluded that the MMDA is not a local government unit or a public
corporation endowed with legislative power, and, unlike its predecessor, the
Metro Manila Commission, it has no power to enact ordinances for the
welfare of the community. Thus, in the absence of an ordinance from the City
of Makati, its own order to open the street was invalid.
We restate here the doctrine in the said decision as it applies to the case at
bar: police power, as an inherent attribute of sovereignty, is the power vested
by the Constitution in the legislature to make, ordain, and establish all
manner of wholesome and reasonable laws, statutes and ordinances, either
with penalties or without, not repugnant to the Constitution, as they shall
judge to be for the good and welfare of the commonwealth, and for the
subjects of the same.
Having been lodged primarily in the National Legislature, it cannot be
exercised by any group or body of individuals not possessing legislative
power. The National Legislature, however, may delegate this power to the
president and administrative boards as well as the lawmaking bodies of
municipal corporations or local government units (LGUs). Once delegated,
the agents can exercise only such legislative powers as are conferred on
them by the national lawmaking body.

Our Congress delegated police power to the LGUs in the Local Government
Code of 1991.[15] A local government is a political subdivision of a nation or
state which is constituted by law and has substantial control of local
affairs.[16] Local government units are the provinces, cities, municipalities
and barangays, which exercise police power through their respective
legislative bodies.
Metropolitan or Metro Manila is a body composed of several local
government units. With the passage of Rep. Act No. 7924 in 1995,
Metropolitan Manila was declared as a "special development and
administrative region" and the administration of "metro-wide" basic services
affecting the region placed under "a development authority" referred to as the
MMDA. Thus:
. . . [T]he powers of the MMDA are limited to the following acts: formulation,
coordination, regulation, implementation, preparation, management,
monitoring, setting of policies, installation of a system and administration.
There is no syllable in R. A. No. 7924 that grants the MMDA police power, let
alone legislative power. Even the Metro Manila Council has not been
delegated any legislative power. Unlike the legislative bodies of the local
government units, there is no provision in R. A. No. 7924 that empowers the
MMDA or its Council to "enact ordinances, approve resolutions and
appropriate funds for the general welfare" of the inhabitants of Metro Manila.
The MMDA is, as termed in the charter itself, a "development authority." It is
an agency created for the purpose of laying down policies and coordinating
with the various national government agencies, people's organizations, nongovernmental organizations and the private sector for the efficient and
expeditious delivery of basic services in the vast metropolitan area. All its
functions are administrative in nature and these are actually summed up in
the charter itself, viz:
Sec. 2. Creation of the Metropolitan Manila Development Authority. -- -x x x.
The MMDA shall perform planning, monitoring and coordinative functions,
and in the process exercise regulatory and supervisory authority over the
delivery of metro-wide services within Metro Manila, without diminution of the
autonomy of the local government units concerning purely local matters.
.
Clearly, the MMDA is not a political unit of government. The power delegated
to the MMDA is that given to the Metro Manila Council to promulgate
administrative rules and regulations in the implementation of the MMDAs
functions. There is no grant of authority to enact ordinances and regulations
for the general welfare of the inhabitants of the metropolis. [17] (footnotes
omitted, emphasis supplied)

Therefore, insofar as Sec. 5(f) of Rep. Act No. 7924 is understood by the
lower court and by the petitioner to grant the MMDA the power to confiscate
and suspend or revoke drivers licenses without need of any other legislative
enactment, such is an unauthorized exercise of police power.
3. Sec. 5(f) grants the MMDA with the duty to enforce existing traffic rules
and regulations.

expenditures if provided by the individual LGUs, especially with regard to

transport and traffic management,[23] and we are aware of the valiant efforts
of the petitioner to untangle the increasingly traffic-snarled roads of Metro
Manila. But these laudable intentions are limited by the MMDAs enabling law,
which we can but interpret, and petitioner must be reminded that its efforts in
this respect must be authorized by a valid law, or ordinance, or regulation
arising from a legitimate source.
WHEREFORE, the petition is DISMISSED.

Section 5 of Rep. Act No. 7924 enumerates the Functions and Powers of the
Metro Manila Development Authority. The contested clause in Sec. 5(f)
states that the petitioner shall install and administer a single ticketing system,
fix, impose and collect fines and penalties for all kinds of violations of traffic
rules and regulations, whether moving or nonmoving in nature, and
confiscate and suspend or revoke drivers licenses in the enforcement of such
traffic laws and regulations, the provisions of Rep. Act No. 4136[18] and P.D.
No. 1605[19] to the contrary notwithstanding, and that (f)or this purpose, the
Authority shall enforce all traffic laws and regulations in Metro Manila,
through its traffic operation center, and may deputize members of the PNP,
traffic enforcers of local government units, duly licensed security guards, or
members of non-governmental organizations to whom may be delegated
certain authority, subject to such conditions and requirements as the
Authority may impose.
Thus, where there is a traffic law or regulation validly enacted by the
legislature or those agencies to whom legislative powers have been
delegated (the City of Manila in this case), the petitioner is not precluded and
in fact is duty-bound to confiscate and suspend or revoke drivers licenses in
the exercise of its mandate of transport and traffic management, as well as
the administration and implementation of all traffic enforcement operations,
traffic engineering services and traffic education programs.[20]
This is consistent with our ruling in Bel-Air that the MMDA is a development
authority created for the purpose of laying down policies and coordinating
with the various national government agencies, peoples organizations, nongovernmental organizations and the private sector, which may enforce, but
not enact, ordinances.
This is also consistent with the fundamental rule of statutory construction that
a statute is to be read in a manner that would breathe life into it, rather than
defeat it,[21] and is supported by the criteria in cases of this nature that all
reasonable doubts should be resolved in favor of the constitutionality of a
statute.[22]
A last word. The MMDA was intended to coordinate services with metro-wide
impact that transcend local political boundaries or would entail huge

SO ORDERED.
Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.

G.R. No. L-17689

January 30, 1962

JOSE BELEY, in his capacity as Registrar of the Motor Vehicles Office,

Nueva Ecija Agency, petitioner,
vs.
HON. GENARO TAN TORRES, as Judge of the Court of First Instance of
Nueva Ecija and FELIX B. MARBELLA, respondents.
Mariano Capuyoc for petitioner.
Rafael Villarosa for respondents.
LABRADOR, J.:
This is a petition for certiorari with preliminary injunction to review and
reverse an order of the Court of First Instance of Nueva Ecija, Hon. Genaro
Tan Torres, presiding, dated October 20, 1960, issued in Civil Case No.
3446, entitled "Felix B. Marbella, plaintiff, versus Jose A. Tan, Felipe
Villajuan and Pacifico Mendoza and Elpidio A. Tangunan, defendants,"
ordering Jose Beley, petitioner herein, in his capacity as Registrar of the
Motor Vehicles Office of Cabanatuan City, to return to the respondent herein
Felix B. Marbella Plate No. T-30271 and to Quirico Curamen his driver's
license, within 10 days from receipt of the order.
On May 9, 1960, Felix B. Marbella instituted said Civil case No. 3446 in the
Court of First Instance of Nueva Ecija against Chief of Police Jose A. Tan,
Mayor Felipe Villajuan, Police Sgt. Pacifico Mendoza and Patrolman Elpidio
A. Tangunan, all of Rizal, Nueva Ecija, alleging that the defendants have
illegally detained a truck with ten tires and its plate No. T-30371, Nueva Ecija
1960, and praying for their release and for damages for their alleged illegal
seizure and detention. Upon motion of respondent herein Marbella on May
17, 1960 and his filing a bond, said truck was ordered released by the lower
court.
However, on May 25, 1960, the defendants Jose A. Tan and Pacifico
Mendoza again tried to seize said truck but succeeded in taking only its plate
number and the license of its driver Quirico Curamen. Consequently,
respondent Marbella filed a criminal action against said defendants Tan and
Mendoza for grave coercion with the Provincial Fiscal, which case is still
pending action.
On July 5, 1960, plaintiff Marbella's counsel filed a motion with the lower
court, in the aforementioned Civil Case No. 3446, for the release by the
defendants or by the Registrar of the Motor Vehicles Office of said plate
number and driver's license. (Note that neither the Registrar nor Quirico
Curamen, the driver was a party to Civil Case No. 3446). Acting upon said
motion, the lower court on September 7, 1960 issued an order directing the

defendants and German Magno, Registrar of the Motor Vehicles Office at

Cabanatuan City, to return to the plaintiff Marbella and to Quirico Curamen
said plate number and driver's license. On September 15, 1960, plaintiff
moved to amend said order in that it should be directed to Jose Beley,
petitioner herein, instead of to German Magno, because the latter has
ceased to be the Registrar of the Motor Vehicles Office and that he was
changed by the former.1wph1.t
On September 22, 1960, the Registrar, petitioner herein, through the
Assistant Provincial Fiscal, filed a special appearance in said Civil Case No.
3446, only for the purpose of objecting to the jurisdiction of the lower court to
issue said order to him. He also asked for a reconsideration of the order of
the lower court dated September 7, 1960 and furthermore objected to the
motion for amendment filed by plaintiff Marbella. Petitioner herein claimed in
his objection that the lower court had not acquired jurisdiction either over his
person or of his predecessor in office, German Magno. On October 20, 1960,
the lower court denied the objection of the Registrar and amended its order
of September 7, 1960 in the manner prayed for in plaintiff Marbella's motion.
Consequently, Registrar Jose Beley filed the present petition with this Court.
The sole issue in this appeal refers to the validity of the order of the lower
court dated October 20, 1960, insofar as it orders the petitioner herein to
return to the respondent Marbella the aforesaid plate number and driver's
license.
We have examined the records of the case filed in the court below and we
have found that the cause of action of said case, as contained in the
complaint, is the seizure and detention of the truck, its plate number and 10
tires on April 28, 1960 while the act complained of in plaintiff Marbella's
motion of July 5, 1960 is the seizure of said plate number and driver's license
on May 25, 1960. The two incidents complained of are entirely different from
each other.
The motion for the release of the license plate and driver's license, dated
July 5, 1950, copy of which motion is attached to the answer of the
respondents, makes the following allegation in its paragraph 1.
1. That on May 25, 1960, the defendants, Jose A. Tan, Jr., and Pacifico
Mendoza, seized the plates of the truck of the plaintiff, with number T-30271;
that on the same occasion, the same defendants also seized the driver's
license of the driver of the plaintiff, Quirico Curamen; .... (Annex VI).
The facts alleged in the answer to the motion to release may be briefly stated
as follows: When the defendant Jose Tan learned that the truck impounded
in April, 1960 belonged to Marbella, plaintiff, Tan asked Marbella to explain
why the plate of the truck was not displayed at the back part thereof; that by

reason of the non-display of the plate at the back of the truck Marbella was
accused before the Justice of the peace court of Rizal, Nueva Ecija; that
even upon the delivery of the truck to plaintiff Marbella, by order of the court,
the said plate had not been delivered to Jose Tan; that the reason for the
failure or refusal of Marbella to deliver the plate as demanded was due to the
fact that, as found out later, upon verification from the Motor Vehicles Office,
Cabanatuan City, the truck was not registered during the current year 1960,
although it bore plate No. T-30371 1960 in the name of Agripina Vidal of San
Jose, a plate which was reported as having been lost in the Motor Vehicles
Office, etc.
It is apparent from the above circumstances, therefore, that the plate and
license number of the truck, which were ordered in the court's order now
subject of the petition to be delivered back to Marbella, were taken by Tan
because the truck had not been registered and was using a plate of a vehicle
registered in the name of Agripina Vidal of San Jose, Nueva Ecija, in
violation of Section 36 of the Motor Vehicle Law. The confiscation of the plate
and the driver's license was, therefore, due to a violation of the Motor Vehicle
Law by Marbella, for operating a vehicle on the public highways without the
corresponding certificate of registration and plates (Sec. 21, Ibid). The plate
was evidently a stolen plate and the same was being used by Marbella for a
truck of his own which was not registered.
The law furthermore permits the retention by the police or by the public
prosecuting officer of the thing stolen, or anything which may be used as
proof of the commission of the offense (Section 12, Rule 122, Rules of
Court).
The license plate in question was the object which was stolen from the truck
of Agripina Vidal and at the same time constitutes evidence that Marbella
was using a stolen plate on his truck that was operating on the highways.
The retention of the driver's license was also justified in view of the fact that
the truck was found being used with a stolen plate, and the driver's license is
to be utilized as evidence against the driver of the truck.
The above circumstances certainly justify the employee of the Motor Vehicles
Office at Cabanatuan City to impound the plate and the driver's license, and
the judge below should have refused to order the return of the articles, which
were lawfully confiscated and lawfully retained by the predecessor of the
petitioner herein.
One other point may be considered, and that is, the claim of the petitioner
herein that since Beley was not a party to the original action, and neither was
his predecessor in interest, the order in question for the delivery to Marbella
of the license plate and the driver's license is beyond the jurisdiction of the
court. The objection is a technical one. We prefer to base our decision in the

case on the ground that petitioner herein had the right to retain possession of
the articles mentioned because they are the instruments of an offense or
evidence thereof.
WHEREFORE, the writ is hereby issued, the order subject of the petition set
aside, and the articles subject of the petition ordered to be returned to the
petitioner. With costs against the respondent Felix B. Marbella.
Bengzon, C.J., Padilla, Bautista Angelo, Concepcion, Reyes, J.B.L., Barrera,
Paredes, Dizon and De Leon, JJ., concur.

IN VIEW WHEREOF, the petition is denied. The Decision and Resolution of

the Court of Appeals in CA-G.R. SP No. 39549 are affirmed. Sppedsc
SO ORDERED.
Davide, Jr., C.J., (Chairman), Kapunan, Pardo, and Ynares-Santiago, JJ.,
concur.

G.R. No. 167514

METROPOLITAN MANILA DEVELOPMENT AUTHORITY,
Petitioner, - versus - TRACKWORKS RAIL TRANSIT ADVERTISING,
VENDING AND PROMOTIONS, INC., Respondent. October 25, 2005
DECISION
YNARES-SANTIAGO, J.:
This petition for review[1] assails the August 31, 2004 Decision[2] of the
Court of Appeals in CA-G.R. SP No. 70932, which affirmed the March 25,
2002 Order[3] of the Regional Trial Court of Pasig City, Branch 155, in Civil
Case No. 68864, granting the issuance of a writ of preliminary injunction
restraining petitioner Metropolitan Manila Development Authority (MMDA)
from dismantling the signages, banners, and billboards installed by
respondent Trackworks Rail Transit Advertising, Vending and Promotions,
Inc. (TRACKWORKS) at the Metro Rail Transit structure along the Epifanio
De los Santos Avenue (MRT 3), and its March 14, 2005 Resolution[4]
denying petitioners motion for reconsideration.
The undisputed facts show that on August 8, 1997, the Philippine
government, through the Department of Transportation and Communications
entered into a Build, Lease and Transfer (BLT) Agreement with Metro Rail
Transit Corporation, Limited (MRTC). In the BLT Agreement, MRTC
undertook to build MRT 3 which it shall own for 25 years, after which,
ownership shall be transferred to the Philippine government in accordance
with Republic Act No. 6957 or the Build, Operate and Transfer Law. The
agreement allows MRTC, either by itself or through any estate developers, to
develop commercial premises in the MRT 3 structure or to obtain advertising
income therefrom, thus:
16.1. Details of Development Rights. DOTC hereby confirms and awards to
Metro Rail the rights to (a) develop commercial premises in the Depot and
the air space above the Stations, which shall be allowed to such height as is
legally and technically feasible, (b) lease or sub-lease interests or assign
such interests in the Depot and such air space and (c) obtain any advertising
income from the Depot and such air space and LRTS Phase I.[5]

LRTS Phase I means the rail transport system comprising about 16.9 line
kilometers extending from Taft Avenue, Pasay City, to North Avenue,
Quezon City, occupying a strip in the center of EDSA approximately 10.5
meters wide (approximately 12 meters wide at or around the Boni Avenue,
Santolan and Buendia Stations), plus about 0.1 to 0.2 line kilometers
extending from the North Avenue Station to the Depot, together with the

Stations, 73 Light Rail Vehicles and all ancillary plant, equipment and
facilities, as more particularly detailed in the Specifications.[6]

16.2. Assignment of Rights. During the Development Rights Period, Metro

Rail shall be entitled to assign all or any of its rights, titles and interests in the
Development Rights to bona fide real estate developers. In this connection,
Metro Rail may enter into such development, lease, sub-lease or other
agreements or contracts relating to the Depot and the air space above the
Stations (the space not needed for all or any portion of the operation of the
LRTS) for all or any portion of the Development Rights Period.[7]

On October 27, 1998, MRTC entered into a Contract for Advertising Services
with TRACKWORKS giving the latter the exclusive right to undertake
advertising and promotional activities within and along the exterior and
interior of the MRT 3 structure.[8] Thereafter, TRACKWORKS proceeded to
install commercial billboards, banners, signages and other forms of
advertisement in the different parts of MRT 3 structure.
On January 29, 2001,[9] however, the MMDA requested TRACKWORKS to
dismantle the billboards purportedly in conformity with MMDA Regulation No.
96-009, prohibiting the posting, installation and display of any kind or form of
billboards, signs, posts, streamers, in any part of the road, sidewalk, center
island, posts, trees, parks and open space. TRACKWORKS refused to
comply and invoked its advertising contract with MRTC. Consequently,
MMDA started dismantling the billboards and streamers of TRACKWORKS.
On March 1, 2002, TRACKWORKS filed with the trial court a petition for
injunction with prayer for the issuance of a temporary restraining order and
preliminary injunction docketed as Civil Case No. 68864.[10]
On March 6, 2002, the court a quo issued a temporary restraining order
advising petitioner to desist from dismantling or destroying the signages,
banners and billboards of TRACKWORKS.[11] On March 25, 2002, the trial
court issued the assailed order granting the issuance of a writ of preliminary
injunction against petitioner. The decretal portion thereof, reads:
WHEREFORE, in view of the foregoing, and without delving into the merits of
the instant petition, let a WRIT OF PRELIMINARY INJUNCTION be issued in
the instant case restraining the respondent FROM DISMANTLING OR
OTHERWISE DESTROYING THE SIGNAGES, BANNERS AND
BILLBOARDS INSTALLED BY THE PETITIONER UNTIL FURTHER
ORDERS FROM THIS COURT, conditioned upon the filing by the petitioner
and approval of this Court of a bond in the amount of PhP200,000.00 to

answer for any damage that the respondent may suffer if it turns out later on
that the aforesaid writ was improperly issued.
SO ORDERED.[12]

Without filing a motion for reconsideration, petitioner filed a petition for

certiorari with prohibition before the Court of Appeals which denied the
petition and affirmed the challenged order of the trial court. It held that
TRACKWORKS is entitled to protection because the commercial
advertisements of the latter is sanctioned by the BLT Agreement. The
appellate court further ruled that the petition is dismissable because
petitioner failed to move for reconsideration of the trial courts order before
resorting to the remedy of certiorari under Rule 65 of the Rules of Court.
Petitioners motion for reconsideration was denied, hence, the instant petition.
The sole issue for resolution is whether or not the trial court gravely abused
its discretion in issuing the writ of preliminary injunction.
Section 3, Rule 58 of the Rules of Court enumerates the grounds for the
issuance of a writ of preliminary injunction as follows:
Sec. 3. Grounds for issuance of preliminary injunction. A preliminary
injunction may be granted when it is established:
(a) That the applicant is entitled to the relief demanded, and the whole or part
of such relief consists in restraining the commission or continuance of the act
or acts complained of, or in requiring the performance of an act or acts, either
for a limited period or perpetually;

(b) That the commission, continuance or non-performance of the act or acts

complained of during the litigation would probably work injustice to the
applicant; or
(c) That a party, court, agency or a person is doing, threatening, or is
attempting to do, or is procuring or suffering to be done, some act or acts
probably in violation of the rights of the applicant respecting the subject of the
action or proceeding, and tending to render the judgment ineffectual.
We held in Los Baos Rural Bank, Inc. v. Africa[13] that injunction is a
preservative remedy aimed to protect the complainants substantive rights
and interests during the pendency of the principal action. A preliminary
injunction is merely temporary. It is to be resorted to only when there is a
pressing necessity to avoid injurious consequences that cannot be remedied

under any standard of compensation. Injunction, like other equitable

remedies, should be issued only at the instance of a suitor who has sufficient
interest in or title to the right or the property sought to be protected. It is
proper only when the plaintiff appears to be entitled to the relief demanded in
the complaint. The existence of the right and the violation thereof must be
alleged in the complaint and must constitute at least a prima facie showing of
a right to the final relief. Thus, there are two requisite conditions for the
issuance of a preliminary injunction, namely, (1) the right to be protected
exists prima facie, and (2) the acts sought to be enjoined are violative of that
right. It must be proven that the violation sought to be prevented would cause
an irreparable injustice.
Further, while a clear showing of the right is necessary, its existence need
not be conclusively established. In fact, the evidence required to justify the
issuance of a writ of preliminary injunction in the hearing thereon need not be
conclusive or complete. The evidence need only be a sampling intended to
give the court an idea of the justification for the preliminary injunction,
pending judgment on the merits.[14] Thus, to be entitled to the writ,
respondents are only required to show that they have the ostensible right to
the final relief prayed for in their complaint.
In the case at bar, we find that TRACKWORKS sufficiently established a right
to be protected by a writ of preliminary injunction. The contract with the
MRTC vested it the exclusive right to undertake advertising and promotional
activities at the MRT 3 structure. The Court of Appeals therefore correctly
ruled that what is involved here is not an indiscriminate posting and
installation of commercial advertisements but one sanctioned by a contract. If
not restrained, the dismantling of, and prohibition from, installing
advertisements at the MRT 3 will cause irreparable injury to TRACKWORKS.
This is especially so because TRACKWORKS is generally not entitled to
recover damages resulting from acts of public officers done in their official
capacity and in the honest belief that they have such power.[15] Unless bad
faith is clearly proven, TRACKWORKS will be left without recourse even if
petitioner is later declared without authority to prohibit the posting of
billboards and streamers at the MRT 3 structure. Indeed, prudence dictates
that the status quo be preserved until the merits of the case can be heard
fully.
Moreover, the issuance of a writ of preliminary injunction pending
determination of the case is proper because TRACKWORKS successfully
raise the issue of petitioners power to effect the dismantling of the disputed
commercial advertisements. The general rule that a statute or ordinance
enjoys the presumption of validity and as such, cannot be restrained by
injunction,[16] finds no application here. The core issue in the present case is
not the validity of the law or statute sought to be enforced by petitioner but its
authority to enforce the same. Though the proper construction of the

applicable statutes may incidentally be addressed, the disposition of the

instant controversy hinges on the focal question of whether or not petitioner
can validly prohibit the installation of commercial advertisements at the MRT
3 structure on the basis of MMDA Regulation No. 96-009;[17] Presidential
Decree (PD) No. 1096, or the National Building Code of the Philippines and
its Implementing Rules and Regulations; and Metropolitan Manila
Commission (MMC) Memorandum Circular No. 88-09,[18] dated September
16, 1988.
TRACKWORKS contends that petitioner cannot validly prohibit the
installation of commercial advertisement at the MRT 3 structure on the basis
alone of MMDA Regulation No. 96-009 because it neither has legislative nor
police power. It also avers that petitioner does not have the authority to
enforce the pertinent provisions on Signs under the Building Code and its
Implementing Rules[19] because the power to enforce the same is lodged
with
the Secretary of the Department of Public Works and Highways.[20]
Thus, in resolving said issues, the court a quo is confronted with the following
legal queries (1) can petitioner validly order the dismantling of
TRACKWORKS commercial advertisements based on MMDA Regulation
No. 96-009; (2) is MMC Memorandum Circular No. 88-09 in conformity with
the provisions of the Building Code on Signs? (3) does petitioner possess the
authority to enforce the provisions of the Building Code and/or MMC
Memorandum Circular No. 88-09? and (4) if the answer to the latter question
is in the affirmative, can TRACKWORKS posters, streamers and billboards
be considered as distractions to motorists or offensive to aesthetic and
cultural values and traditions?
Furthermore, even if the validity of the law itself is assailed, courts are not
precluded from issuing an injunctive writ against the enforcement of the
challenged statute. Thus, in Filipino Metals Corporation v. Secretary of
Department of Trade and Industry,[21] the Court upheld the writ of
preliminary injunction issued by the court a quo enjoining the implementation
of Republic Act No. 8800, also known as the Safeguard Measures Act. As
explained by the Court:
We have ruled that when the petitioner assailing a statute has made out a
case of unconstitutionality strong enough to overcome, in the mind of the
judge, the presumption of validity, in addition to a showing of a clear legal
right to the remedy sought, the court should issue a writ of preliminary
injunction.
After a careful consideration of the submission by the parties, we are
convinced that petitioners herein have established a strong case for the

unconstitutionality of Rep. Act No. 8800 sufficient for the grant of a

preliminary injunction. Note, however, that a writ of preliminary injunction is
issued merely to preserve the status quo ante. Its sole objective is to
preserve the status quo until the merits of the case can be heard fully. It is
generally availed of to prevent actual or threatened acts, until the merits of
the case can be disposed of.
Respondents tenaciously argue that Rep. Act No. 8800 enjoys the
presumption of validity and constitutionality until proven otherwise. True, but
for the purpose of issuing a provisional remedy, strictly speaking, this
contention lacks relevance. Obviously, a law need not be declared
unconstitutional first before a preliminary injunction against its enforcement
may be granted. Needless to stress, the moment a law is nullified for being
unconstitutional, it ceases to exist. Thus, a writ of injunction would then
become superfluous.
Only two requisites are necessary for a preliminary injunction to issue: (1) the
existence of a right to be protected and (2) the facts, against which the
injunction is to be directed violate said right. While a clear showing of the
right is necessary, its existence need not be conclusively established. In fact,
the evidence required to justify the issuance of a writ of preliminary injunction
need not be conclusive or complete. The evidence need only give the court
an idea of the justification for the preliminary injunction, pending the decision
of the case on the merits. Thus, to be entitled to the writ, petitioners are only
required to show that they have an ostensible right to the final relief prayed
for in their complaint.
In this case, petitioners have demonstrated a clear right threatened by the
questioned safeguard measures. Being in a business heavily dependent on
importation of steel, they would be severely damaged once safeguard
measures are applied against steel imports. Petitioners have shown, to the
satisfaction of the trial court and this Court that any increase in tariffs or
quantitative restriction on imports will force them to close down their
respective businesses and lay off their employees.
This, to us, is sufficient to entitle petitioners to a preliminary injunction. We
thus hold that the Court of Appeals erred in reversing the trial court order
granting the writ of preliminary injunction. (Emphasis ours)
Grave abuse of discretion means such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction. The abuse of discretion must
be grave as where the power is exercised in an arbitrary or despotic manner
by reason of passion or personal hostility and must be so patent and gross
as to amount to an evasion of positive duty or to a virtual refusal to perform
the duty enjoined by or to act at all in contemplation of law.[22]

In the present case, considering that the power of petitioner to prevent

TRACKWORKS from installing commercial advertisement at the MRT 3
structure depends on the resolution of the issues subject to the determination
of the trial court, the prudent course is to maintain the status quo pending
decision on the merits. We thus find no grave abuse of discretion by the trial
court in issuing the March 25, 2002 order authorizing the issuance of a writ of
preliminary injunction enjoining petitioner from dismantling the signages,
posters and billboards of TRACKWORKS. It is well-entrenched that the
issuance of an injunctive writ rests upon the sound discretion of the trial
court. Hence, its exercise of sound judicial discretion in injunctive matters
must not be interfered with except when there is manifest abuse,[23] which is
wanting in the present case.
Finally, the Court of Appeals correctly held that the failure of petitioner to file
a motion for reconsideration of the trial courts order before resorting to the
remedy of certiorari under Rule 65 is fatal to its cause. Certiorari as a special
civil action will not lie unless a motion for reconsideration is filed before the
respondent tribunal. While the rules allow certain exceptions, none had been
successfully proven by petitioner to warrant a departure from the application
of the general rule. The invocation of public interest will not justify the nonobservance of settled rules. Such phrase is not a magic incantation that
obliterates willful disregard of time-honored jurisprudence that afford the
tribunals, boards or offices, an opportunity to rectify the errors and mistakes it
may have committed before resort to a petition for certiorari can be had.
WHEREFORE, the petition is DENIED. The August 31, 2004 Decision and
the March 14, 2005 Resolution of the Court of Appeals in CA-G.R. SP No.
70932, which sustained the March 25, 2002 Order of the Regional Trial Court
of Pasig City, Branch 155, granting the issuance of a writ of preliminary
injunction in Civil Case No. 68864, are AFFIRMED.
SO ORDERED.

G.R. Nos. 171947-48

December 18, 2008

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, DEPARTMENT

OF ENVIRONMENT AND NATURAL RESOURCES, DEPARTMENT OF
EDUCATION, CULTURE AND SPORTS,1 DEPARTMENT OF HEALTH,
DEPARTMENT OF AGRICULTURE, DEPARTMENT OF PUBLIC WORKS
AND HIGHWAYS, DEPARTMENT OF BUDGET AND MANAGEMENT,
PHILIPPINE COAST GUARD, PHILIPPINE NATIONAL POLICE MARITIME
GROUP, and DEPARTMENT OF THE INTERIOR AND LOCAL
GOVERNMENT, Petitioners,
vs.
CONCERNED RESIDENTS OF MANILA BAY, represented and joined by
DIVINA V. ILAS, SABINIANO ALBARRACIN, MANUEL SANTOS, JR.,
DINAH DELA PEA, PAUL DENNIS QUINTERO, MA. VICTORIA LLENOS,
DONNA CALOZA, FATIMA QUITAIN, VENICE SEGARRA, FRITZIE
TANGKIA, SARAH JOELLE LINTAG, HANNIBAL AUGUSTUS BOBIS,
FELIMON SANTIAGUEL, and JAIME AGUSTIN R. OPOSA, Respondents.
DECISION

This case started when, on January 29, 1999, respondents Concerned

Residents of Manila Bay filed a complaint before the Regional Trial Court
(RTC) in Imus, Cavite against several government agencies, among them
the petitioners, for the cleanup, rehabilitation, and protection of the Manila
Bay. Raffled to Branch 20 and docketed as Civil Case No. 1851-99 of the
RTC, the complaint alleged that the water quality of the Manila Bay had fallen
way below the allowable standards set by law, specifically Presidential
Decree No. (PD) 1152 or the Philippine Environment Code. This
environmental aberration, the complaint stated, stemmed from:
x x x [The] reckless, wholesale, accumulated and ongoing acts of omission or
commission [of the defendants] resulting in the clear and present danger to
public health and in the depletion and contamination of the marine life of
Manila Bay, [for which reason] ALL defendants must be held jointly and/or
solidarily liable and be collectively ordered to clean up Manila Bay and to
restore its water quality to class B waters fit for swimming, skin-diving, and
other forms of contact recreation.[3]

VELASCO, JR., J.:

The need to address environmental pollution, as a cause of climate change,
has of late gained the attention of the international community. Media have
finally trained their sights on the ill effects of pollution, the destruction of
forests and other critical habitats, oil spills, and the unabated improper
disposal of garbage. And rightly so, for the magnitude of environmental
destruction is now on a scale few ever foresaw and the wound no longer
simply heals by itself.[2] But amidst hard evidence and clear signs of a
climate crisis that need bold action, the voice of cynicism, naysayers, and
procrastinators can still be heard.
This case turns on government agencies and their officers who, by the nature
of their respective offices or by direct statutory command, are tasked to
protect and preserve, at the first instance, our internal waters, rivers, shores,
and seas polluted by human activities. To most of these agencies and their
official complement, the pollution menace does not seem to carry the high
national priority it deserves, if their track records are to be the norm. Their
cavalier attitude towards solving, if not mitigating, the environmental pollution
problem, is a sad commentary on bureaucratic efficiency and commitment.
At the core of the case is the Manila Bay, a place with a proud historic past,
once brimming with marine life and, for so many decades in the past, a spot
for different contact recreation activities, but now a dirty and slowly dying
expanse mainly because of the abject official indifference of people and
institutions that could have otherwise made a difference.

In their individual causes of action, respondents alleged that the continued

neglect of petitioners in abating the pollution of the Manila Bay constitutes a
violation of, among others:
(1)
ecology;
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)

Respondents constitutional right to life, health, and a balanced

The Environment Code (PD 1152);
The Pollution Control Law (PD 984);
The Water Code (PD 1067);
The Sanitation Code (PD 856);
The Illegal Disposal of Wastes Decree (PD 825);
The Marine Pollution Law (PD 979);
Executive Order No. 192;
The Toxic and Hazardous Wastes Law (Republic Act No. 6969);
Civil Code provisions on nuisance and human relations;
The Trust Doctrine and the Principle of Guardianship; and
International Law

Inter alia, respondents, as plaintiffs a quo, prayed that petitioners be ordered

to clean the Manila Bay and submit to the RTC a concerted concrete plan of
action for the purpose.
The trial of the case started off with a hearing at the Manila Yacht Club
followed by an ocular inspection of the Manila Bay. Renato T. Cruz, the Chief
of the Water Quality Management Section, Environmental Management

Bureau, Department of Environment and Natural Resources (DENR),

testifying for petitioners, stated that water samples collected from different
beaches around the Manila Bay showed that the amount of fecal coliform
content ranged from 50,000 to 80,000 most probable number (MPN)/ml when
what DENR Administrative Order No. 34-90 prescribed as a safe level for
bathing and other forms of contact recreational activities, or the SB level, is
one not exceeding 200 MPN/100 ml.[4]
Rebecca de Vera, for Metropolitan Waterworks and Sewerage System
(MWSS) and in behalf of other petitioners, testified about the MWSS efforts
to reduce pollution along the Manila Bay through the Manila Second
Sewerage Project. For its part, the Philippine Ports Authority (PPA)
presented, as part of its evidence, its memorandum circulars on the study
being conducted on ship-generated waste treatment and disposal, and its
Linis Dagat (Clean the Ocean) project for the cleaning of wastes
accumulated or washed to shore.
The RTC Ordered Petitioners to Clean Up and Rehabilitate Manila Bay
On September 13, 2002, the RTC rendered a Decision[5] in favor of
respondents. The dispositive portion reads:
WHEREFORE, finding merit in the complaint, judgment is hereby rendered
ordering the abovenamed defendant-government agencies, jointly and
solidarily, to clean up and rehabilitate Manila Bay and restore its waters to
SB classification to make it fit for swimming, skin-diving and other forms of
contact recreation. To attain this, defendant-agencies, with defendant DENR
as the lead agency, are directed, within six (6) months from receipt hereof, to
act and perform their respective duties by devising a consolidated,
coordinated and concerted scheme of action for the rehabilitation and
restoration of the bay.
In particular:
Defendant MWSS is directed to install, operate and maintain adequate
[sewerage] treatment facilities in strategic places under its jurisdiction and
increase their capacities.
Defendant LWUA, to see to it that the water districts under its wings, provide,
construct and operate sewage facilities for the proper disposal of waste.
Defendant DENR, which is the lead agency in cleaning up Manila Bay, to
install, operate and maintain waste facilities to rid the bay of toxic and
hazardous substances.

Defendant PPA, to prevent and also to treat the discharge not only of shipgenerated wastes but also of other solid and liquid wastes from docking
vessels that contribute to the pollution of the bay.
Defendant MMDA, to establish, operate and maintain an adequate and
appropriate sanitary landfill and/or adequate solid waste and liquid disposal
as well as other alternative garbage disposal system such as re-use or
recycling of wastes.
Defendant DA, through the Bureau of Fisheries and Aquatic Resources, to
revitalize the marine life in Manila Bay and restock its waters with indigenous
fish and other aquatic animals.
Defendant DBM, to provide and set aside an adequate budget solely for the
purpose of cleaning up and rehabilitation of Manila Bay.
Defendant DPWH, to remove and demolish structures and other nuisances
that obstruct the free flow of waters to the bay. These nuisances discharge
solid and liquid wastes which eventually end up in Manila Bay. As the
construction and engineering arm of the government, DPWH is ordered to
actively participate in removing debris, such as carcass of sunken vessels,
and other non-biodegradable garbage in the bay.
Defendant DOH, to closely supervise and monitor the operations of septic
and sludge companies and require them to have proper facilities for the
treatment and disposal of fecal sludge and sewage coming from septic tanks.
Defendant DECS, to inculcate in the minds and hearts of the people through
education the importance of preserving and protecting the environment.
Defendant Philippine Coast Guard and the PNP Maritime Group, to protect at
all costs the Manila Bay from all forms of illegal fishing.
No pronouncement as to damages and costs.
SO ORDERED.
The MWSS, Local Water Utilities Administration (LWUA), and PPA filed
before the Court of Appeals (CA) individual Notices of Appeal which were
eventually consolidated and docketed as CA-G.R. CV No. 76528.
On the other hand, the DENR, Department of Public Works and Highways
(DPWH), Metropolitan Manila Development Authority (MMDA), Philippine
Coast Guard (PCG), Philippine National Police (PNP) Maritime Group, and
five other executive departments and agencies filed directly with this Court a
petition for review under Rule 45. The Court, in a Resolution of December 9,

2002, sent the said petition to the CA for consolidation with the consolidated
appeals of MWSS, LWUA, and PPA, docketed as CA-G.R. SP No. 74944.

On August 12, 2008, the Court conducted and heard the parties on oral
arguments.

Petitioners, before the CA, were one in arguing in the main that the pertinent
provisions of the Environment Code (PD 1152) relate only to the cleaning of
specific pollution incidents and do not cover cleaning in general. And apart
from raising concerns about the lack of funds appropriated for cleaning
purposes, petitioners also asserted that the cleaning of the Manila Bay is not
a ministerial act which can be compelled by mandamus.

Our Ruling
We shall first dwell on the propriety of the issuance of mandamus under the
premises.

The Cleaning or Rehabilitation of Manila Bay

Can be Compelled by Mandamus
The CA Sustained the RTC
By a Decision[6] of September 28, 2005, the CA denied petitioners appeal
and affirmed the Decision of the RTC in toto, stressing that the trial courts
decision did not require petitioners to do tasks outside of their usual basic
functions under existing laws.[7]
Petitioners are now before this Court praying for the allowance of their Rule
45 petition on the following ground and supporting arguments:
THE [CA] DECIDED A QUESTION OF SUBSTANCE NOT HERETOFORE
PASSED UPON BY THE HONORABLE COURT, I.E., IT AFFIRMED THE
TRIAL COURTS DECISION DECLARING THAT SECTION 20 OF [PD] 1152
REQUIRES CONCERNED GOVERNMENT AGENCIES TO REMOVE ALL
POLLUTANTS SPILLED AND DISCHARGED IN THE WATER SUCH AS
FECAL COLIFORMS.
ARGUMENTS
I
[SECTIONS] 17 AND 20 OF [PD] 1152 RELATE ONLY TO THE CLEANING
OF SPECIFIC POLLUTION INCIDENTS AND [DO] NOT COVER
CLEANING IN GENERAL
II
THE CLEANING OR REHABILITATION OF THE MANILA BAY IS NOT A
MINISTERIAL ACT OF PETITIONERS THAT CAN BE COMPELLED BY
MANDAMUS.

Generally, the writ of mandamus lies to require the execution of a ministerial

duty.[8] A ministerial duty is one that requires neither the exercise of official
discretion nor judgment.[9] It connotes an act in which nothing is left to the
discretion of the person executing it. It is a simple, definite duty arising under
conditions admitted or proved to exist and imposed by law.[10] Mandamus is
available to compel action, when refused, on matters involving discretion, but
not to direct the exercise of judgment or discretion one way or the other.
Petitioners maintain that the MMDAs duty to take measures and maintain
adequate solid waste and liquid disposal systems necessarily involves policy
evaluation and the exercise of judgment on the part of the agency
concerned. They argue that the MMDA, in carrying out its mandate, has to
make decisions, including choosing where a landfill should be located by
undertaking feasibility studies and cost estimates, all of which entail the
exercise of discretion.
Respondents, on the other hand, counter that the statutory command is clear
and that petitioners duty to comply with and act according to the clear
mandate of the law does not require the exercise of discretion. According to
respondents, petitioners, the MMDA in particular, are without discretion, for
example, to choose which bodies of water they are to clean up, or which
discharge or spill they are to contain. By the same token, respondents
maintain that petitioners are bereft of discretion on whether or not to alleviate
the problem of solid and liquid waste disposal; in other words, it is the
MMDAs ministerial duty to attend to such services.
We agree with respondents.

The issues before us are two-fold. First, do Sections 17 and 20 of PD 1152

under the headings, Upgrading of Water Quality and Clean-up Operations,
envisage a cleanup in general or are they limited only to the cleanup of
specific pollution incidents? And second, can petitioners be compelled by
mandamus to clean up and rehabilitate the Manila Bay?

First off, we wish to state that petitioners obligation to perform their duties as
defined by law, on one hand, and how they are to carry out such duties, on
the other, are two different concepts. While the implementation of the
MMDAs mandated tasks may entail a decision-making process, the
enforcement of the law or the very act of doing what the law exacts to be
done is ministerial in nature and may be compelled by mandamus. We said

so in Social Justice Society v. Atienza[11] in which the Court directed the City
of Manila to enforce, as a matter of ministerial duty, its Ordinance No. 8027
directing the three big local oil players to cease and desist from operating
their business in the so-called Pandacan Terminals within six months from
the effectivity of the ordinance. But to illustrate with respect to the instant
case, the MMDAs duty to put up an adequate and appropriate sanitary
landfill and solid waste and liquid disposal as well as other alternative
garbage disposal systems is ministerial, its duty being a statutory imposition.
The MMDAs duty in this regard is spelled out in Sec. 3(c) of Republic Act No.
(RA) 7924 creating the MMDA. This section defines and delineates the scope
of the MMDAs waste disposal services to include:
Solid waste disposal and management which include formulation and
implementation of policies, standards, programs and projects for proper and
sanitary waste disposal. It shall likewise include the establishment and
operation of sanitary land fill and related facilities and the implementation of
other alternative programs intended to reduce, reuse and recycle solid waste.
(Emphasis added.)

The MMDA is duty-bound to comply with Sec. 41 of the Ecological Solid

Waste Management Act (RA 9003) which prescribes the minimum criteria for
the establishment of sanitary landfills and Sec. 42 which provides the
minimum operating requirements that each site operator shall maintain in the
operation of a sanitary landfill. Complementing Sec. 41 are Secs. 36 and 37
of RA 9003,[12] enjoining the MMDA and local government units, among
others, after the effectivity of the law on February 15, 2001, from using and
operating open dumps for solid waste and disallowing, five years after such
effectivity, the use of controlled dumps.
The MMDAs duty in the area of solid waste disposal, as may be noted, is set
forth not only in the Environment Code (PD 1152) and RA 9003, but in its
charter as well. This duty of putting up a proper waste disposal system
cannot be characterized as discretionary, for, as earlier stated, discretion
presupposes the power or right given by law to public functionaries to act
officially according to their judgment or conscience.[13] A discretionary duty
is one that allows a person to exercise judgment and choose to perform or
not to perform.[14] Any suggestion that the MMDA has the option whether or
not to perform its solid waste disposal-related duties ought to be dismissed
for want of legal basis.
A perusal of other petitioners respective charters or like enabling statutes
and pertinent laws would yield this conclusion: these government agencies
are enjoined, as a matter of statutory obligation, to perform certain functions
relating directly or indirectly to the cleanup, rehabilitation, protection, and

preservation of the Manila Bay. They are precluded from choosing not to
perform these duties. Consider:
(1) The DENR, under Executive Order No. (EO) 192,[15] is the primary
agency responsible for the conservation, management, development, and
proper use of the countrys environment and natural resources. Sec. 19 of the
Philippine Clean Water Act of 2004 (RA 9275), on the other hand, designates
the DENR as the primary government agency responsible for its enforcement
and implementation, more particularly over all aspects of water quality
management. On water pollution, the DENR, under the Acts Sec. 19(k),
exercises jurisdiction over all aspects of water pollution, determine[s] its
location, magnitude, extent, severity, causes and effects and other pertinent
information on pollution, and [takes] measures, using available methods and
technologies, to prevent and abate such pollution.
The DENR, under RA 9275, is also tasked to prepare a National Water
Quality Status Report, an Integrated Water Quality Management Framework,
and a 10-year Water Quality Management Area Action Plan which is
nationwide in scope covering the Manila Bay and adjoining areas. Sec. 19 of
RA 9275 provides:
Sec. 19 Lead Agency.The [DENR] shall be the primary government agency
responsible for the implementation and enforcement of this Act x x x unless
otherwise provided herein. As such, it shall have the following functions,
powers and responsibilities:
a)
Prepare a National Water Quality Status report within twenty-four (24)
months from the effectivity of this Act: Provided, That the Department shall
thereafter review or revise and publish annually, or as the need arises, said
report;
b)
Prepare an Integrated Water Quality Management Framework within
twelve (12) months following the completion of the status report;
c)
Prepare a ten (10) year Water Quality Management Area Action Plan
within 12 months following the completion of the framework for each
designated water management area. Such action plan shall be reviewed by
the water quality management area governing board every five (5) years or
as need arises.

The DENR has prepared the status report for the period 2001 to 2005 and is
in the process of completing the preparation of the Integrated Water Quality
Management Framework.[16] Within twelve (12) months thereafter, it has to
submit a final Water Quality Management Area Action Plan.[17] Again, like
the MMDA, the DENR should be made to accomplish the tasks assigned to it
under RA 9275.

Parenthetically, during the oral arguments, the DENR Secretary manifested

that the DENR, with the assistance of and in partnership with various
government agencies and non-government organizations, has completed, as
of December 2005, the final draft of a comprehensive action plan with
estimated budget and time frame, denominated as Operation Plan for the
Manila Bay Coastal Strategy, for the rehabilitation, restoration, and
rehabilitation of the Manila Bay.
The completion of the said action plan and even the implementation of some
of its phases should more than ever prod the concerned agencies to fast
track what are assigned them under existing laws.
(2) The MWSS, under Sec. 3 of RA 6234,[18] is vested with jurisdiction,
supervision, and control over all waterworks and sewerage systems in the
territory comprising what is now the cities of Metro Manila and several towns
of the provinces of Rizal and Cavite, and charged with the duty:
(g) To construct, maintain, and operate such sanitary sewerages as may be
necessary for the proper sanitation and other uses of the cities and towns
comprising the System; x x x

(3) The LWUA under PD 198 has the power of supervision and control over
local water districts. It can prescribe the minimum standards and regulations
for the operations of these districts and shall monitor and evaluate local
water standards. The LWUA can direct these districts to construct, operate,
and furnish facilities and services for the collection, treatment, and disposal
of sewerage, waste, and storm water. Additionally, under RA 9275, the
LWUA, as attached agency of the DPWH, is tasked with providing sewerage
and sanitation facilities, inclusive of the setting up of efficient and safe
collection, treatment, and sewage disposal system in the different parts of the
country.[19] In relation to the instant petition, the LWUA is mandated to
provide sewerage and sanitation facilities in Laguna, Cavite, Bulacan,
Pampanga, and Bataan to prevent pollution in the Manila Bay.
(4) The Department of Agriculture (DA), pursuant to the Administrative Code
of 1987 (EO 292),[20] is designated as the agency tasked to promulgate and
enforce all laws and issuances respecting the conservation and proper
utilization of agricultural and fishery resources. Furthermore, the DA, under
the Philippine Fisheries Code of 1998 (RA 8550), is, in coordination with local
government units (LGUs) and other concerned sectors, in charge of
establishing a monitoring, control, and surveillance system to ensure that
fisheries and aquatic resources in Philippine waters are judiciously utilized
and managed on a sustainable basis.[21] Likewise under RA 9275, the DA is
charged with coordinating with the PCG and DENR for the enforcement of
water quality standards in marine waters.[22] More specifically, its Bureau of
Fisheries and Aquatic Resources (BFAR) under Sec. 22(c) of RA 9275 shall
primarily be responsible for the prevention and control of water pollution for

the development, management, and conservation of the fisheries and aquatic

resources.
(5) The DPWH, as the engineering and construction arm of the national
government, is tasked under EO 292[23] to provide integrated planning,
design, and construction services for, among others, flood control and water
resource development systems in accordance with national development
objectives and approved government plans and specifications.
In Metro Manila, however, the MMDA is authorized by Sec. 3(d), RA 7924 to
perform metro-wide services relating to flood control and sewerage
management which include the formulation and implementation of policies,
standards, programs and projects for an integrated flood control, drainage
and sewerage system.
On July 9, 2002, a Memorandum of Agreement was entered into between the
DPWH and MMDA, whereby MMDA was made the agency primarily
responsible for flood control in Metro Manila. For the rest of the country,
DPWH shall remain as the implementing agency for flood control services.
The mandate of the MMDA and DPWH on flood control and drainage
services shall include the removal of structures, constructions, and
encroachments built along rivers, waterways, and esteros (drainages) in
violation of RA 7279, PD 1067, and other pertinent laws.
(6) The PCG, in accordance with Sec. 5(p) of PD 601, or the Revised Coast
Guard Law of 1974, and Sec. 6 of PD 979,[24] or the Marine Pollution
Decree of 1976, shall have the primary responsibility of enforcing laws, rules,
and regulations governing marine pollution within the territorial waters of the
Philippines. It shall promulgate its own rules and regulations in accordance
with the national rules and policies set by the National Pollution Control
Commission upon consultation with the latter for the effective implementation
and enforcement of PD 979. It shall, under Sec. 4 of the law, apprehend
violators who:
a. discharge, dump x x x harmful substances from or out of any ship, vessel,
barge, or any other floating craft, or other man-made structures at sea, by
any method, means or manner, into or upon the territorial and inland
navigable waters of the Philippines;
b. throw, discharge or deposit, dump, or cause, suffer or procure to be
thrown, discharged, or deposited either from or out of any ship, barge, or
other floating craft or vessel of any kind, or from the shore, wharf,
manufacturing establishment, or mill of any kind, any refuse matter of any
kind or description whatever other than that flowing from streets and sewers
and passing therefrom in a liquid state into tributary of any navigable water
from which the same shall float or be washed into such navigable water; and

c. deposit x x x material of any kind in any place on the bank of any

navigable water or on the bank of any tributary of any navigable water, where
the same shall be liable to be washed into such navigable water, either by
ordinary or high tides, or by storms or floods, or otherwise, whereby
navigation shall or may be impeded or obstructed or increase the level of
pollution of such water.

(7) When RA 6975 or the Department of the Interior and Local Government
(DILG) Act of 1990 was signed into law on December 13, 1990, the PNP
Maritime Group was tasked to perform all police functions over the Philippine
territorial waters and rivers. Under Sec. 86, RA 6975, the police functions of
the PCG shall be taken over by the PNP when the latter acquires the
capability to perform such functions. Since the PNP Maritime Group has not
yet attained the capability to assume and perform the police functions of
PCG over marine pollution, the PCG and PNP Maritime Group shall
coordinate with regard to the enforcement of laws, rules, and regulations
governing marine pollution within the territorial waters of the Philippines. This
was made clear in Sec. 124, RA 8550 or the Philippine Fisheries Code of
1998, in which both the PCG and PNP Maritime Group were authorized to
enforce said law and other fishery laws, rules, and regulations.[25]
(8) In accordance with Sec. 2 of EO 513, the PPA is mandated to establish,
develop, regulate, manage and operate a rationalized national port system in
support of trade and national development.[26] Moreover, Sec. 6-c of EO 513
states that the PPA has police authority within the
ports administered by it as may be necessary to carry out its powers and
functions and attain its purposes and objectives, without prejudice to the
exercise of the functions of the Bureau of Customs and other law
enforcement bodies within the area. Such police authority shall include the
following:
xxxx
b) To regulate the entry to, exit from, and movement within the port, of
persons and vehicles, as well as movement within the port of watercraft.[27]

Lastly, as a member of the International Marine Organization and a signatory

to the International Convention for the Prevention of Pollution from Ships, as
amended by MARPOL 73/78,[28] the Philippines, through the PPA, must
ensure the provision of adequate reception facilities at ports and terminals for
the reception of sewage from the ships docking in Philippine ports. Thus, the
PPA is tasked to adopt such measures as are necessary to prevent the
discharge and dumping of solid and liquid wastes and other ship-generated

wastes into the Manila Bay waters from vessels docked at ports and
apprehend the violators. When the vessels are not docked at ports but within
Philippine territorial waters, it is the PCG and PNP Maritime Group that have
jurisdiction over said vessels.
(9) The MMDA, as earlier indicated, is duty-bound to put up and maintain
adequate sanitary landfill and solid waste and liquid disposal system as well
as other alternative garbage disposal systems. It is primarily responsible for
the implementation and enforcement of the provisions of RA 9003, which
would necessary include its penal provisions, within its area of
jurisdiction.[29]
Among the prohibited acts under Sec. 48, Chapter VI of RA 9003 that are
frequently violated are dumping of waste matters in public places, such as
roads, canals or esteros, open burning of solid waste, squatting in open
dumps and landfills, open dumping, burying of biodegradable or nonbiodegradable materials in flood-prone areas, establishment or operation of
open dumps as enjoined in RA 9003, and operation of waste management
facilities without an environmental compliance certificate.
Under Sec. 28 of the Urban Development and Housing Act of 1992 (RA
7279), eviction or demolition may be allowed when persons or entities
occupy danger areas such as esteros, railroad tracks, garbage dumps,
riverbanks, shorelines, waterways, and other public places such as
sidewalks, roads, parks and playgrounds. The MMDA, as lead agency, in
coordination with the DPWH, LGUs, and concerned agencies, can dismantle
and remove all structures, constructions, and other encroachments built in
breach of RA 7279 and other pertinent laws along the rivers, waterways, and
esteros in Metro Manila. With respect to rivers, waterways, and esteros in
Bulacan, Bataan, Pampanga, Cavite, and Laguna that discharge wastewater
directly or eventually into the Manila Bay, the DILG shall direct the concerned
LGUs to implement the demolition and removal of such structures,
constructions, and other encroachments built in violation of RA 7279 and
other applicable laws in coordination with the DPWH and concerned
agencies.
(10) The Department of Health (DOH), under Article 76 of PD 1067 (the
Water Code), is tasked to promulgate rules and regulations for the
establishment of waste disposal areas that affect the source of a water
supply or a reservoir for domestic or municipal use. And under Sec. 8 of RA
9275, the DOH, in coordination with the DENR, DPWH, and other concerned
agencies, shall formulate guidelines and standards for the collection,
treatment, and disposal of sewage and the establishment and operation of a
centralized sewage treatment system. In areas not considered as highly
urbanized cities, septage or a mix sewerage-septage management system
shall be employed.

In accordance with Sec. 72[30] of PD 856, the Code of Sanitation of the

Philippines, and Sec. 5.1.1[31] of Chapter XVII of its implementing rules, the
DOH is also ordered to ensure the regulation and monitoring of the proper
disposal of wastes by private sludge companies through the strict
enforcement of the requirement to obtain an environmental sanitation
clearance of sludge collection treatment and disposal before these
companies are issued their environmental sanitation permit.
(11) The Department of Education (DepEd), under the Philippine
Environment Code (PD 1152), is mandated to integrate subjects on
environmental education in its school curricula at all levels.[32] Under Sec.
118 of RA 8550, the DepEd, in collaboration with the DA, Commission on
Higher Education, and Philippine Information Agency, shall launch and
pursue a nationwide educational campaign to promote the development,
management, conservation, and proper use of the environment. Under the
Ecological Solid Waste Management Act (RA 9003), on the other hand, it is
directed to strengthen the integration of environmental concerns in school
curricula at all levels, with an emphasis on waste management principles.[33]
(12) The Department of Budget and Management (DBM) is tasked under
Sec. 2, Title XVII of the Administrative Code of 1987 to ensure the efficient
and sound utilization of government funds and revenues so as to effectively
achieve the countrys development objectives.[34]
One of the countrys development objectives is enshrined in RA 9275 or the
Philippine Clean Water Act of 2004. This law stresses that the State shall
pursue a policy of economic growth in a manner consistent with the
protection, preservation, and revival of the quality of our fresh, brackish, and
marine waters. It also provides that it is the policy of the government, among
others, to streamline processes and procedures in the prevention, control,
and abatement of pollution mechanisms for the protection of water
resources; to promote environmental strategies and use of appropriate
economic instruments and of control mechanisms for the protection of water
resources; to formulate a holistic national program of water quality
management that recognizes that issues related to this management cannot
be separated from concerns about water sources and ecological protection,
water supply, public health, and quality of life; and to provide a
comprehensive management program for water pollution focusing on
pollution prevention.
Thus, the DBM shall then endeavor to provide an adequate budget to attain
the noble objectives of RA 9275 in line with the countrys development
objectives.
All told, the aforementioned enabling laws and issuances are in themselves
clear, categorical, and complete as to what are the obligations and mandate

of each agency/petitioner under the law. We need not belabor the issue that
their tasks include the cleanup of the Manila Bay.
Now, as to the crux of the petition. Do Secs. 17 and 20 of the Environment
Code encompass the cleanup of water pollution in general, not just specific
pollution incidents?
Secs. 17 and 20 of the Environment Code
Include Cleaning in General
The disputed sections are quoted as follows:
Section 17. Upgrading of Water Quality.Where the quality of water has
deteriorated to a degree where its state will adversely affect its best usage,
the government agencies concerned shall take such measures as may be
necessary to upgrade the quality of such water to meet the prescribed water
quality standards.
Section 20. Clean-up Operations.It shall be the responsibility of the polluter
to contain, remove and clean-up water pollution incidents at his own
expense. In case of his failure to do so, the government agencies concerned
shall undertake containment, removal and clean-up operations and expenses
incurred in said operations shall be charged against the persons and/or
entities responsible for such pollution.
When the Clean Water Act (RA 9275) took effect, its Sec. 16 on the subject,
Cleanup Operations, amended the counterpart provision (Sec. 20) of the
Environment Code (PD 1152). Sec. 17 of PD 1152 continues, however, to be
operational.
The amendatory Sec. 16 of RA 9275 reads:
SEC. 16. Cleanup Operations.Notwithstanding the provisions of Sections 15
and 26 hereof, any person who causes pollution in or pollutes water bodies in
excess of the applicable and prevailing standards shall be responsible to
contain, remove and clean up any pollution incident at his own expense to
the extent that the same water bodies have been rendered unfit for utilization
and beneficial use: Provided, That in the event emergency cleanup
operations are necessary and the polluter fails to immediately undertake the
same, the [DENR] in coordination with other government agencies
concerned, shall undertake containment, removal and cleanup operations.
Expenses incurred in said operations shall be reimbursed by the persons
found to have caused such pollution under proper administrative
determination x x x. Reimbursements of the cost incurred shall be made to
the Water Quality Management Fund or to such other funds where said
disbursements were sourced.

among the water pollution incidents contemplated in Sec. 17 in relation to

Sec. 20 of PD 1152.
As may be noted, the amendment to Sec. 20 of the Environment Code is
more apparent than real since the amendment, insofar as it is relevant to this
case, merely consists in the designation of the DENR as lead agency in the
cleanup operations.
Petitioners contend at every turn that Secs. 17 and 20 of the Environment
Code concern themselves only with the matter of cleaning up in specific
pollution incidents, as opposed to cleanup in general. They aver that the twin
provisions would have to be read alongside the succeeding Sec. 62(g) and
(h), which defines the terms cleanup operations and accidental spills, as
follows:
g. Clean-up Operations [refer] to activities conducted in removing the
pollutants discharged or spilled in water to restore it to pre-spill condition.
h.
Accidental Spills [refer] to spills of oil or other hazardous
substances in water that result from accidents such as collisions and
groundings.

Petitioners proffer the argument that Secs. 17 and 20 of PD 1152 merely

direct the government agencies concerned to undertake containment,
removal, and cleaning operations of a specific polluted portion or portions of
the body of water concerned. They maintain that the application of said Sec.
20 is limited only to water pollution incidents, which are situations that
presuppose the occurrence of specific, isolated pollution events requiring the
corresponding containment, removal, and cleaning operations. Pushing the
point further, they argue that the aforequoted Sec. 62(g) requires cleanup
operations to restore the body of water to pre-spill condition, which means
that there must have been a specific incident of either intentional or
accidental spillage of oil or other hazardous substances, as mentioned in
Sec. 62(h).
As a counterpoint, respondents argue that petitioners erroneously read Sec.
62(g) as delimiting the application of Sec. 20 to the containment, removal,
and cleanup operations for accidental spills only. Contrary to petitioners
posture, respondents assert that Sec. 62(g), in fact, even expanded the
coverage of Sec. 20. Respondents explain that without its Sec. 62(g), PD
1152 may have indeed covered only pollution accumulating from the day-today operations of businesses around the Manila Bay and other sources of
pollution that slowly accumulated in the bay. Respondents, however,
emphasize that Sec. 62(g), far from being a delimiting provision, in fact even
enlarged the operational scope of Sec. 20, by including accidental spills as

To respondents, petitioners parochial view on environmental issues, coupled

with their narrow reading of their respective mandated roles, has contributed
to the worsening water quality of the Manila Bay. Assuming, respondents
assert, that petitioners are correct in saying that the cleanup coverage of
Sec. 20 of PD 1152 is constricted by the definition of the phrase cleanup
operations embodied in Sec. 62(g), Sec. 17 is not hobbled by such limiting
definition. As pointed out, the phrases cleanup operations and accidental
spills do not appear in said Sec. 17, not even in the chapter where said
section is found.
Respondents are correct. For one thing, said Sec. 17 does not in any way
state that the government agencies concerned ought to confine themselves
to the containment, removal, and cleaning operations when a specific
pollution incident occurs. On the contrary, Sec. 17 requires them to act even
in the absence of a specific pollution incident, as long as water quality has
deteriorated to a degree where its state will adversely affect its best usage.
This section, to stress, commands concerned government agencies, when
appropriate, to take such measures as may be necessary to meet the
prescribed water quality standards. In fine, the underlying duty to upgrade
the quality of water is not conditional on the occurrence of any pollution
incident.
For another, a perusal of Sec. 20 of the Environment Code, as couched,
indicates that it is properly applicable to a specific situation in which the
pollution is caused by polluters who fail to clean up the mess they left behind.
In such instance, the concerned government agencies shall undertake the
cleanup work for the polluters account. Petitioners assertion, that they have
to perform cleanup operations in the Manila Bay only when there is a water
pollution incident and the erring polluters do not undertake the containment,
removal, and cleanup operations, is quite off mark. As earlier discussed, the
complementary Sec. 17 of the Environment Code comes into play and the
specific duties of the agencies to clean up come in even if there are no
pollution incidents staring at them. Petitioners, thus, cannot plausibly invoke
and hide behind Sec. 20 of PD 1152 or Sec. 16 of RA 9275 on the pretext
that their cleanup mandate depends on the happening of a specific pollution
incident. In this regard, what the CA said with respect to the impasse over
Secs. 17 and 20 of PD 1152 is at once valid as it is practical. The appellate
court wrote: PD 1152 aims to introduce a comprehensive program of
environmental protection and management. This is better served by making
Secs. 17 & 20 of general application rather than limiting them to specific
pollution incidents.[35]

Granting arguendo that petitioners position thus described vis--vis the

implementation of Sec. 20 is correct, they seem to have overlooked the fact
that the pollution of the Manila Bay is of such magnitude and scope that it is
well-nigh impossible to draw the line between a specific and a general
pollution incident. And such impossibility extends to pinpointing with
reasonable certainty who the polluters are. We note that Sec. 20 of PD 1152
mentions water pollution incidents which may be caused by polluters in the
waters of the Manila Bay itself or by polluters in adjoining lands and in water
bodies or waterways that empty into the bay. Sec. 16 of RA 9275, on the
other hand, specifically adverts to any person who causes pollution in or
pollutes water bodies, which may refer to an individual or an establishment
that pollutes the land mass near the Manila Bay or the waterways, such that
the contaminants eventually end up in the bay. In this situation, the water
pollution incidents are so numerous and involve nameless and faceless
polluters that they can validly be categorized as beyond the specific pollution
incident level.
Not to be ignored of course is the reality that the government agencies
concerned are so undermanned that it would be almost impossible to
apprehend the numerous polluters of the Manila Bay. It may perhaps not be
amiss to say that the apprehension, if any, of the Manila Bay polluters has
been few and far between. Hence, practically nobody has been required to
contain, remove, or clean up a given water pollution incident. In this kind of
setting, it behooves the Government to step in and undertake cleanup
operations. Thus, Sec. 16 of RA 9275, previously Sec. 20 of PD 1152, covers
for all intents and purposes a general cleanup situation.
The cleanup and/or restoration of the Manila Bay is only an aspect and the
initial stage of the long-term solution. The preservation of the water quality of
the bay after the rehabilitation process is as important as the cleaning phase.
It is imperative then that the wastes and contaminants found in the rivers,
inland bays, and other bodies of water be stopped from reaching the Manila
Bay. Otherwise, any cleanup effort would just be a futile, cosmetic exercise,
for, in no time at all, the Manila Bay water quality would again deteriorate
below the ideal minimum standards set by PD 1152, RA 9275, and other
relevant laws. It thus behooves the Court to put the heads of the petitionerdepartment-agencies and the bureaus and offices under them on continuing
notice about, and to enjoin them to perform, their mandates and duties
towards cleaning up the Manila Bay and preserving the quality of its water to
the ideal level. Under what other judicial discipline describes as continuing
mandamus,[36] the Court may, under extraordinary circumstances, issue
directives with the end in view of ensuring that its decision would not be set
to naught by administrative inaction or indifference. In India, the doctrine of
continuing mandamus was used to enforce directives of the court to clean up
the length of the Ganges River from industrial and municipal pollution.[37]
The Court can take judicial notice of the presence of shanties and other
unauthorized structures which do not have septic tanks along the Pasig-

Marikina-San Juan Rivers, the National Capital Region (NCR) (ParaaqueZapote, Las Pias) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers,
the Meycuayan-Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan)
River, the Imus (Cavite) River, the Laguna De Bay, and other minor rivers
and connecting waterways, river banks, and esteros which discharge their
waters, with all the accompanying filth, dirt, and garbage, into the major
rivers and eventually the Manila Bay. If there is one factor responsible for the
pollution of the major river systems and the Manila Bay, these unauthorized
structures would be on top of the list. And if the issue of illegal or
unauthorized structures is not seriously addressed with sustained resolve,
then practically all efforts to cleanse these important bodies of water would
be for naught. The DENR Secretary said as much.[38]
Giving urgent dimension to the necessity of removing these illegal structures
is Art. 51 of PD 1067 or the Water Code,[39] which prohibits the building of
structures within a given length along banks of rivers and other waterways.
Art. 51 reads:
The banks of rivers and streams and the shores of the seas and lakes
throughout their entire length and within a zone of three (3) meters in urban
areas, twenty (20) meters in agricultural areas and forty (40) meters in forest
areas, along their margins, are subject to the easement of public use in the
interest of recreation, navigation, floatage, fishing and salvage. No person
shall be allowed to stay in this zone longer than what is necessary for
recreation, navigation, floatage, fishing or salvage or to build structures of
any kind. (Emphasis added.)

Judicial notice may likewise be taken of factories and other industrial

establishments standing along or near the banks of the Pasig River, other
major rivers, and connecting waterways. But while they may not be treated
as unauthorized constructions, some of these establishments undoubtedly
contribute to the pollution of the Pasig River and waterways. The DILG and
the concerned LGUs, have, accordingly, the duty to see to it that noncomplying industrial establishments set up, within a reasonable period, the
necessary waste water treatment facilities and infrastructure to prevent their
industrial discharge, including their sewage waters, from flowing into the
Pasig River, other major rivers, and connecting waterways. After such period,
non-complying establishments shall be shut down or asked to transfer their
operations.
At this juncture, and if only to dramatize the urgency of the need for
petitioners-agencies to comply with their statutory tasks, we cite the Asian
Development Bank-commissioned study on the garbage problem in Metro
Manila, the results of which are embodied in the The Garbage Book. As there

reported, the garbage crisis in the metropolitan area is as alarming as it is

shocking. Some highlights of the report:
1. As early as 2003, three land-filled dumpsites in Metro Manila - the
Payatas, Catmon and Rodriquez dumpsites - generate an alarming quantity
of lead and leachate or liquid run-off. Leachate are toxic liquids that flow
along the surface and seep into the earth and poison the surface and
groundwater that are used for drinking, aquatic life, and the environment.
2. The high level of fecal coliform confirms the presence of a large amount of
human waste in the dump sites and surrounding areas, which is presumably
generated by households that lack alternatives to sanitation. To say that
Manila Bay needs rehabilitation is an understatement.
3. Most of the deadly leachate, lead and other dangerous contaminants and
possibly strains of pathogens seeps untreated into ground water and runs
into the Marikina and Pasig River systems and Manila Bay.[40]
Given the above perspective, sufficient sanitary landfills should now more
than ever be established as prescribed by the Ecological Solid Waste
Management Act (RA 9003). Particular note should be taken of the blatant
violations by some LGUs and possibly the MMDA of Sec. 37, reproduced
below:
Sec. 37. Prohibition against the Use of Open Dumps for Solid Waste.No
open dumps shall be established and operated, nor any practice or disposal
of solid waste by any person, including LGUs which [constitute] the use of
open dumps for solid waste, be allowed after the effectivity of this Act:
Provided, further that no controlled dumps shall be allowed (5) years
following the effectivity of this Act. (Emphasis added.)

RA 9003 took effect on February 15, 2001 and the adverted grace period of
five (5) years which ended on February 21, 2006 has come and gone, but no
single sanitary landfill which strictly complies with the prescribed standards
under RA 9003 has yet been set up.
In addition, there are rampant and repeated violations of Sec. 48 of RA 9003,
like littering, dumping of waste matters in roads, canals, esteros, and other
public places, operation of open dumps, open burning of solid waste, and the
like. Some sludge companies which do not have proper disposal facilities
simply discharge sludge into the Metro Manila sewerage system that ends up
in the Manila Bay. Equally unabated are violations of Sec. 27 of RA 9275,
which enjoins the pollution of water bodies, groundwater pollution, disposal of
infectious wastes from vessels, and unauthorized transport or dumping into
sea waters of sewage or solid waste and of Secs. 4 and 102 of RA 8550
which proscribes the introduction by human or machine of substances to the

aquatic environment including dumping/disposal of waste and other marine

litters, discharge of petroleum or residual products of petroleum of
carbonaceous materials/substances [and other] radioactive, noxious or
harmful liquid, gaseous or solid substances, from any water, land or air
transport or other human-made structure.
In the light of the ongoing environmental degradation, the Court wishes to
emphasize the extreme necessity for all concerned executive departments
and agencies to immediately act and discharge their respective official duties
and obligations. Indeed, time is of the essence; hence, there is a need to set
timetables for the performance and completion of the tasks, some of them as
defined for them by law and the nature of their respective offices and
mandates.
The importance of the Manila Bay as a sea resource, playground, and as a
historical landmark cannot be over-emphasized. It is not yet too late in the
day to restore the Manila Bay to its former splendor and bring back the plants
and sea life that once thrived in its blue waters. But the tasks ahead,
daunting as they may be, could only be accomplished if those mandated,
with the help and cooperation of all civic-minded individuals, would put their
minds to these tasks and take responsibility. This means that the State,
through petitioners, has to take the lead in the preservation and protection of
the Manila Bay.
The era of delays, procrastination, and ad hoc measures is over. Petitioners
must transcend their limitations, real or imaginary, and buckle down to work
before the problem at hand becomes unmanageable. Thus, we must
reiterate that different government agencies and instrumentalities cannot
shirk from their mandates; they must perform their basic functions in cleaning
up and rehabilitating the Manila Bay. We are disturbed by petitioners hiding
behind two untenable claims: (1) that there ought to be a specific pollution
incident before they are required to act; and (2) that the cleanup of the bay is
a discretionary duty.
RA 9003 is a sweeping piece of legislation enacted to radically transform and
improve waste management. It implements Sec. 16, Art. II of the 1987
Constitution, which explicitly provides that the State shall protect and
advance the right of the people to a balanced and healthful ecology in accord
with the rhythm and harmony of nature.
So it was that in Oposa v. Factoran, Jr. the Court stated that the right to a
balanced and healthful ecology need not even be written in the Constitution
for it is assumed, like other civil and political rights guaranteed in the Bill of
Rights, to exist from the inception of mankind and it is an issue of
transcendental importance with intergenerational implications.[41] Even
assuming the absence of a categorical legal provision specifically prodding

petitioners to clean up the bay, they and the men and women representing
them cannot escape their obligation to future generations of Filipinos to keep
the waters of the Manila Bay clean and clear as humanly as possible.
Anything less would be a betrayal of the trust reposed in them.
WHEREFORE, the petition is DENIED. The September 28, 2005 Decision of
the CA in CA-G.R. CV No. 76528 and SP No. 74944 and the September 13,
2002 Decision of the RTC in Civil Case No. 1851-99 are AFFIRMED but with
MODIFICATIONS in view of subsequent developments or supervening
events in the case. The fallo of the RTC Decision shall now read:
WHEREFORE, judgment is hereby rendered ordering the abovenamed
defendant-government agencies to clean up, rehabilitate, and preserve
Manila Bay, and restore and maintain its waters to SB level (Class B sea
waters per Water Classification Tables under DENR Administrative Order
No. 34 [1990]) to make them fit for swimming, skin-diving, and other forms of
contact recreation.
In particular:
(1) Pursuant to Sec. 4 of EO 192, assigning the DENR as the primary agency
responsible for the conservation, management, development, and proper use
of the countrys environment and natural resources, and Sec. 19 of RA 9275,
designating the DENR as the primary government agency responsible for its
enforcement and implementation, the DENR is directed to fully implement its
Operational Plan for the Manila Bay Coastal Strategy for the rehabilitation,
restoration, and conservation of the Manila Bay at the earliest possible time.
It is ordered to call regular coordination meetings with concerned government
departments and agencies to ensure the successful implementation of the
aforesaid plan of action in accordance with its indicated completion
schedules.
(2) Pursuant to Title XII (Local Government) of the Administrative Code of
1987 and Sec. 25 of the Local Government Code of 1991,[42] the DILG, in
exercising the Presidents power of general supervision and its duty to
promulgate guidelines in establishing waste management programs under
Sec. 43 of the Philippine Environment Code (PD 1152), shall direct all LGUs
in Metro Manila, Rizal, Laguna, Cavite, Bulacan, Pampanga, and Bataan to
inspect all factories, commercial establishments, and private homes along
the banks of the major river systems in their respective areas of jurisdiction,
such as but not limited to the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-TullahanTenejeros Rivers, the Meycauayan-Marilao-Obando (Bulacan) Rivers, the
Talisay (Bataan) River, the Imus (Cavite) River, the Laguna De Bay, and
other minor rivers and waterways that eventually discharge water into the
Manila Bay; and the lands abutting the bay, to determine whether they have
wastewater treatment facilities or hygienic septic tanks as prescribed by

existing laws, ordinances, and rules and regulations. If none be found, these
LGUs shall be ordered to require non-complying establishments and homes
to set up said facilities or septic tanks within a reasonable time to prevent
industrial wastes, sewage water, and human wastes from flowing into these
rivers, waterways, esteros, and the Manila Bay, under pain of closure or
imposition of fines and other sanctions.
(3) As mandated by Sec. 8 of RA 9275,[43] the MWSS is directed to provide,
install, operate, and maintain the necessary adequate waste water treatment
facilities in Metro Manila, Rizal, and Cavite where needed at the earliest
possible time.
(4) Pursuant to RA 9275,[44] the LWUA, through the local water districts and
in coordination with the DENR, is ordered to provide, install, operate, and
maintain sewerage and sanitation facilities and the efficient and safe
collection, treatment, and disposal of sewage in the provinces of Laguna,
Cavite, Bulacan, Pampanga, and Bataan where needed at the earliest
possible time.
(5) Pursuant to Sec. 65 of RA 8550,[45] the DA, through the BFAR, is
ordered to improve and restore the marine life of the Manila Bay. It is also
directed to assist the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan,
Pampanga, and Bataan in developing, using recognized methods, the
fisheries and aquatic resources in the Manila Bay.
(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and the PNP Maritime
Group, in accordance with Sec. 124 of RA 8550, in coordination with each
other, shall apprehend violators of PD 979, RA 8550, and other existing laws
and regulations designed to prevent marine pollution in the Manila Bay.
(7) Pursuant to Secs. 2 and 6-c of EO 513[46] and the International
Convention for the Prevention of Pollution from Ships, the PPA is ordered to
immediately adopt such measures to prevent the discharge and dumping of
solid and liquid wastes and other ship-generated wastes into the Manila Bay
waters from vessels docked at ports and apprehend the violators.
(8) The MMDA, as the lead agency and implementor of programs and
projects for flood control projects and drainage services in Metro Manila, in
coordination with the DPWH, DILG, affected LGUs, PNP Maritime Group,
Housing and Urban Development Coordinating Council (HUDCC), and other
agencies, shall dismantle and remove all structures, constructions, and other
encroachments established or built in violation of RA 7279, and other
applicable laws along the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-TullahanTenejeros Rivers, and connecting waterways and esteros in Metro Manila.
The DPWH, as the principal implementor of programs and projects for flood
control services in the rest of the country more particularly in Bulacan,

Bataan, Pampanga, Cavite, and Laguna, in coordination with the DILG,

affected LGUs, PNP Maritime Group, HUDCC, and other concerned
government agencies, shall remove and demolish all structures,
constructions, and other encroachments built in breach of RA 7279 and other
applicable laws along the Meycauayan-Marilao-Obando (Bulacan) Rivers,
the Talisay (Bataan) River, the Imus (Cavite) River, the Laguna De Bay, and
other rivers, connecting waterways, and esteros that discharge wastewater
into the Manila Bay.
In addition, the MMDA is ordered to establish, operate, and maintain a
sanitary landfill, as prescribed by RA 9003, within a period of one (1) year
from finality of this Decision. On matters within its territorial jurisdiction and in
connection with the discharge of its duties on the maintenance of sanitary
landfills and like undertakings, it is also ordered to cause the apprehension
and filing of the appropriate criminal cases against violators of the respective
penal provisions of RA 9003,[47] Sec. 27 of RA 9275 (the Clean Water Act),
and other existing laws on pollution.
(9) The DOH shall, as directed by Art. 76 of PD 1067 and Sec. 8 of RA 9275,
within one (1) year from finality of this Decision, determine if all licensed
septic and sludge companies have the proper facilities for the treatment and
disposal of fecal sludge and sewage coming from septic tanks. The DOH
shall give the companies, if found to be non-complying, a reasonable time
within which to set up the necessary facilities under pain of cancellation of its
environmental sanitation clearance.
(10) Pursuant to Sec. 53 of PD 1152,[48] Sec. 118 of RA 8550, and Sec. 56
of RA 9003,[49] the DepEd shall integrate lessons on pollution prevention,
waste management, environmental protection, and like subjects in the school
curricula of all levels to inculcate in the minds and hearts of students and,
through them, their parents and friends, the importance of their duty toward
achieving and maintaining a balanced and healthful ecosystem in the Manila
Bay and the entire Philippine archipelago.
(11) The DBM shall consider incorporating an adequate budget in the
General Appropriations Act of 2010 and succeeding years to cover the
expenses relating to the cleanup, restoration, and preservation of the water
quality of the Manila Bay, in line with the countrys development objective to
attain economic growth in a manner consistent with the protection,
preservation, and revival of our marine waters.
(12) The heads of petitioners-agencies MMDA, DENR, DepEd, DOH, DA,
DPWH, DBM, PCG, PNP Maritime Group, DILG, and also of MWSS, LWUA,
and PPA, in line with the principle of continuing mandamus, shall, from
finality of this Decision, each submit to the Court a quarterly progressive
report of the activities undertaken in accordance with this Decision.
No costs.

SO ORDERED.

G.R. Nos. 171947-48

February 15, 2011

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, DEPARTMENT

OF ENVIRONMENT AND NATURAL RESOURCES, DEPARTMENT OF
EDUCATION, CULTURE AND SPORTS,1 DEPARTMENT OF HEALTH,
DEPARTMENT OF AGRICULTURE, DEPARTMENT OF PUBLIC WORKS
AND HIGHWAYS, DEPARTMENT OF BUDGET AND MANAGEMENT,
PHILIPPINE COAST GUARD, PHILIPPINE NATIONAL POLICE MARITIME
GROUP, and DEPARTMENT OF THE INTERIOR AND LOCAL
GOVERNMENT, Petitioners,
vs.
CONCERNED RESIDENTS OF MANILA BAY, represented and joined by
DIVINA V. ILAS, SABINIANO ALBARRACIN, MANUEL SANTOS, JR.,
DINAH DELA PEA, PAUL DENNIS QUINTERO, MA. VICTORIA LLENOS,
DONNA CALOZA, FATIMA QUITAIN, VENICE SEGARRA, FRITZIE
TANGKIA, SARAH JOELLE LINTAG, HANNIBAL AUGUSTUS BOBIS,
FELIMON SANTIAGUEL, and JAIME AGUSTIN R. OPOSA, Respondents.
RESOLUTION
VELASCO, JR., J.:
On December 18, 2008, this Court rendered a Decision in G.R. Nos. 17194748 ordering petitioners to clean up, rehabilitate and preserve Manila Bay in
their different capacities. The fallo reads:
WHEREFORE, the petition is DENIED. The September 28, 2005 Decision of
the CA in CA-G.R. CV No. 76528 and SP No. 74944 and the September 13,
2002 Decision of the RTC in Civil Case No. 1851-99 are AFFIRMED but with
MODIFICATIONS in view of subsequent developments or supervening
events in the case. The fallo of the RTC Decision shall now read:
WHEREFORE, judgment is hereby rendered ordering the abovenamed
defendant-government agencies to clean up, rehabilitate, and preserve
Manila Bay, and restore and maintain its waters to SB level (Class B sea
waters per Water Classification Tables under DENR Administrative Order
No. 34 [1990]) to make them fit for swimming, skin-diving, and other forms of
contact recreation.

Operational Plan for the Manila Bay Coastal Strategy for the rehabilitation,
restoration, and conservation of the Manila Bay at the earliest possible time.
It is ordered to call regular coordination meetings with concerned government
departments and agencies to ensure the successful implementation of the
aforesaid plan of action in accordance with its indicated completion
schedules.
(2) Pursuant to Title XII (Local Government) of the Administrative Code of
1987 and Sec. 25 of the Local Government Code of 1991, the DILG, in
exercising the Presidents power of general supervision and its duty to
promulgate guidelines in establishing waste management programs under
Sec. 43 of the Philippine Environment Code (PD 1152), shall direct all LGUs
in Metro Manila, Rizal, Laguna, Cavite, Bulacan, Pampanga, and Bataan to
inspect all factories, commercial establishments, and private homes along
the banks of the major river systems in their respective areas of jurisdiction,
such as but not limited to the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-TullahanTenejeros Rivers, the Meycauayan-Marilao-Obando (Bulacan) Rivers, the
Talisay (Bataan) River, the Imus (Cavite) River, the Laguna De Bay, and
other minor rivers and waterways that eventually discharge water into the
Manila Bay; and the lands abutting the bay, to determine whether they have
wastewater treatment facilities or hygienic septic tanks as prescribed by
existing laws, ordinances, and rules and regulations. If none be found, these
LGUs shall be ordered to require non-complying establishments and homes
to set up said facilities or septic tanks within a reasonable time to prevent
industrial wastes, sewage water, and human wastes from flowing into these
rivers, waterways, esteros, and the Manila Bay, under pain of closure or
imposition of fines and other sanctions.
(3) As mandated by Sec. 8 of RA 9275, the MWSS is directed to provide,
install, operate, and maintain the necessary adequate waste water treatment
facilities in Metro Manila, Rizal, and Cavite where needed at the earliest
possible time.

In particular:

(4) Pursuant to RA 9275, the LWUA, through the local water districts and in
coordination with the DENR, is ordered to provide, install, operate, and
maintain sewerage and sanitation facilities and the efficient and safe
collection, treatment, and disposal of sewage in the provinces of Laguna,
Cavite, Bulacan, Pampanga, and Bataan where needed at the earliest
possible time.

(1) Pursuant to Sec. 4 of EO 192, assigning the DENR as the primary agency
responsible for the conservation, management, development, and proper use
of the countrys environment and natural resources, and Sec. 19 of RA 9275,
designating the DENR as the primary government agency responsible for its
enforcement and implementation, the DENR is directed to fully implement its

(5) Pursuant to Sec. 65 of RA 8550, the DA, through the BFAR, is ordered to
improve and restore the marine life of the Manila Bay. It is also directed to
assist the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga,
and Bataan in developing, using recognized methods, the fisheries and
aquatic resources in the Manila Bay.

(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and the PNP Maritime
Group, in accordance with Sec. 124 of RA 8550, in coordination with each
other, shall apprehend violators of PD 979, RA 8550, and other existing laws
and regulations designed to prevent marine pollution in the Manila Bay.
(7) Pursuant to Secs. 2 and 6-c of EO 513 and the International Convention
for the Prevention of Pollution from Ships, the PPA is ordered to immediately
adopt such measures to prevent the discharge and dumping of solid and
liquid wastes and other ship-generated wastes into the Manila Bay waters
from vessels docked at ports and apprehend the violators.
(8) The MMDA, as the lead agency and implementor of programs and
projects for flood control projects and drainage services in Metro Manila, in
coordination with the DPWH, DILG, affected LGUs, PNP Maritime Group,
Housing and Urban Development Coordinating Council (HUDCC), and other
agencies, shall dismantle and remove all structures, constructions, and other
encroachments established or built in violation of RA 7279, and other
applicable laws along the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-TullahanTenejeros Rivers, and connecting waterways and esteros in Metro Manila.
The DPWH, as the principal implementor of programs and projects for flood
control services in the rest of the country more particularly in Bulacan,
Bataan, Pampanga, Cavite, and Laguna, in coordination with the DILG,
affected LGUs, PNP Maritime Group, HUDCC, and other concerned
government agencies, shall remove and demolish all structures,
constructions, and other encroachments built in breach of RA 7279 and other
applicable laws along the Meycauayan-Marilao-Obando (Bulacan) Rivers,
the Talisay (Bataan) River, the Imus (Cavite) River, the Laguna De Bay, and
other rivers, connecting waterways, and esteros that discharge wastewater
into the Manila Bay.
In addition, the MMDA is ordered to establish, operate, and maintain a
sanitary landfill, as prescribed by RA 9003, within a period of one (1) year
from finality of this Decision. On matters within its territorial jurisdiction and in
connection with the discharge of its duties on the maintenance of sanitary
landfills and like undertakings, it is also ordered to cause the apprehension
and filing of the appropriate criminal cases against violators of the respective
penal provisions of RA 9003, Sec. 27 of RA 9275 (the Clean Water Act), and
other existing laws on pollution.

within which to set up the necessary facilities under pain of cancellation of its
environmental sanitation clearance.
(10) Pursuant to Sec. 53 of PD 1152, Sec. 118 of RA 8550, and Sec. 56 of
RA 9003, the DepEd shall integrate lessons on pollution prevention, waste
management, environmental protection, and like subjects in the school
curricula of all levels to inculcate in the minds and hearts of students and,
through them, their parents and friends, the importance of their duty toward
achieving and maintaining a balanced and healthful ecosystem in the Manila
Bay and the entire Philippine archipelago.
(11) The DBM shall consider incorporating an adequate budget in the
General Appropriations Act of 2010 and succeeding years to cover the
expenses relating to the cleanup, restoration, and preservation of the water
quality of the Manila Bay, in line with the countrys development objective to
attain economic growth in a manner consistent with the protection,
preservation, and revival of our marine waters.
(12) The heads of petitioners-agencies MMDA, DENR, DepEd, DOH, DA,
DPWH, DBM, PCG, PNP Maritime Group, DILG, and also of MWSS, LWUA,
and PPA, in line with the principle of "continuing mandamus," shall, from
finality of this Decision, each submit to the Court a quarterly progressive
report of the activities undertaken in accordance with this Decision.
SO ORDERED.
The government agencies did not file any motion for reconsideration and the
Decision became final in January 2009.
The case is now in the execution phase of the final and executory December
18, 2008 Decision. The Manila Bay Advisory Committee was created to
receive and evaluate the quarterly progressive reports on the activities
undertaken by the agencies in accordance with said decision and to monitor
the execution phase.
In the absence of specific completion periods, the Committee recommended
that time frames be set for the agencies to perform their assigned tasks. This
may be viewed as an encroachment over the powers and functions of the
Executive Branch headed by the President of the Philippines.
This view is misplaced.

(9) The DOH shall, as directed by Art. 76 of PD 1067 and Sec. 8 of RA 9275,
within one (1) year from finality of this Decision, determine if all licensed
septic and sludge companies have the proper facilities for the treatment and
disposal of fecal sludge and sewage coming from septic tanks. The DOH
shall give the companies, if found to be non-complying, a reasonable time

The issuance of subsequent resolutions by the Court is simply an exercise of

judicial power under Art. VIII of the Constitution, because the execution of the
Decision is but an integral part of the adjudicative function of the Court. None
of the agencies ever questioned the power of the Court to implement the

December 18, 2008 Decision nor has any of them raised the alleged
encroachment by the Court over executive functions.
While additional activities are required of the agencies like submission of
plans of action, data or status reports, these directives are but part and
parcel of the execution stage of a final decision under Rule 39 of the Rules of
Court. Section 47 of Rule 39 reads:
Section 47. Effect of judgments or final orders.The effect of a judgment or
final order rendered by a court of the Philippines, having jurisdiction to
pronounce the judgment or final order, may be as follows:
xxxx
(c) In any other litigation between the same parties of their successors in
interest, that only is deemed to have been adjudged in a former judgment or
final order which appears upon its face to have been so adjudged, or which
was actually and necessarily included therein or necessary thereto.
(Emphasis supplied.)
It is clear that the final judgment includes not only what appears upon its face
to have been so adjudged but also those matters "actually and necessarily
included therein or necessary thereto." Certainly, any activity that is needed
to fully implement a final judgment is necessarily encompassed by said
judgment.
Moreover, the submission of periodic reports is sanctioned by Secs. 7 and 8,
Rule 8 of the Rules of Procedure for Environmental cases:
Sec. 7. Judgment.If warranted, the court shall grant the privilege of the writ
of continuing mandamus requiring respondent to perform an act or series of
acts until the judgment is fully satisfied and to grant such other reliefs as may
be warranted resulting from the wrongful or illegal acts of the respondent.
The court shall require the respondent to submit periodic reports detailing the
progress and execution of the judgment, and the court may, by itself or
through a commissioner or the appropriate government agency, evaluate and
monitor compliance. The petitioner may submit its comments or observations
on the execution of the judgment.
Sec. 8. Return of the writ.The periodic reports submitted by the respondent
detailing compliance with the judgment shall be contained in partial returns of
the writ. Upon full satisfaction of the judgment, a final return of the writ shall
be made to the court by the respondent. If the court finds that the judgment
has been fully implemented, the satisfaction of judgment shall be entered in
the court docket. (Emphasis supplied.)

With the final and executory judgment in MMDA, the writ of continuing
mandamus issued in MMDA means that until petitioner-agencies have shown
full compliance with the Courts orders, the Court exercises continuing
jurisdiction over them until full execution of the judgment.
There being no encroachment over executive functions to speak of, We shall
now proceed to the recommendation of the Manila Bay Advisory Committee.
Several problems were encountered by the Manila Bay Advisory
Committee.2 An evaluation of the quarterly progressive reports has shown
that (1) there are voluminous quarterly progressive reports that are being
submitted; (2) petitioner-agencies do not have a uniform manner of reporting
their cleanup, rehabilitation and preservation activities; (3) as yet no definite
deadlines have been set by petitioner DENR as to petitioner-agencies
timeframe for their respective duties; (4) as of June 2010 there has been a
change in leadership in both the national and local levels; and (5) some
agencies have encountered difficulties in complying with the Courts
directives.
In order to implement the afore-quoted Decision, certain directives have to be
issued by the Court to address the said concerns.
Acting on the recommendation of the Manila Bay Advisory Committee, the
Court hereby resolves to ORDER the following:
(1) The Department of Environment and Natural Resources (DENR), as lead
agency in the Philippine Clean Water Act of 2004, shall submit to the Court
on or before June 30, 2011 the updated Operational Plan for the Manila Bay
Coastal Strategy.
The DENR is ordered to submit summarized data on the overall quality of
Manila Bay waters for all four quarters of 2010 on or before June 30, 2011.
The DENR is further ordered to submit the names and addresses of persons
and companies in Metro Manila, Rizal, Laguna, Cavite, Bulacan, Pampanga
and Bataan that generate toxic and hazardous waste on or before
September 30, 2011.
(2) On or before June 30, 2011, the Department of the Interior and Local
Government (DILG) shall order the Mayors of all cities in Metro Manila; the
Governors of Rizal, Laguna, Cavite, Bulacan, Pampanga and Bataan; and
the Mayors of all the cities and towns in said provinces to inspect all
factories, commercial establishments and private homes along the banks of
the major river systemssuch as but not limited to the Pasig-Marikina-San
Juan Rivers, the National Capital Region (Paranaque-Zapote, Las Pinas)
Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, the Meycauayan-

Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) River, the Imus

(Cavite) River, and the Laguna De Bayand other minor rivers and
waterways within their jurisdiction that eventually discharge water into the
Manila Bay and the lands abutting it, to determine if they have wastewater
treatment facilities and/or hygienic septic tanks, as prescribed by existing
laws, ordinances, rules and regulations. Said local government unit (LGU)
officials are given up to September 30, 2011 to finish the inspection of said
establishments and houses.
In case of non-compliance, the LGU officials shall take appropriate action to
ensure compliance by non-complying factories, commercial establishments
and private homes with said law, rules and regulations requiring the
construction or installment of wastewater treatment facilities or hygienic
septic tanks.
The aforementioned governors and mayors shall submit to the DILG on or
before December 31, 2011 their respective compliance reports which will
contain the names and addresses or offices of the owners of all the noncomplying factories, commercial establishments and private homes, copy
furnished the concerned environmental agency, be it the local DENR office or
the Laguna Lake Development Authority.
The DILG is required to submit a five-year plan of action that will contain
measures intended to ensure compliance of all non-complying factories,
commercial establishments, and private homes.
On or before June 30, 2011, the DILG and the mayors of all cities in Metro
Manila shall consider providing land for the wastewater facilities of the
Metropolitan Waterworks and Sewerage System (MWSS) or its
concessionaires (Maynilad and Manila Water, Inc.) within their respective
jurisdictions.
(3) The MWSS shall submit to the Court on or before June 30, 2011 the list
of areas in Metro Manila, Rizal and Cavite that do not have the necessary
wastewater treatment facilities. Within the same period, the concessionaires
of the MWSS shall submit their plans and projects for the construction of
wastewater treatment facilities in all the aforesaid areas and the completion
period for said facilities, which shall not go beyond 2037.
On or before June 30, 2011, the MWSS is further required to have its two
concessionaires submit a report on the amount collected as sewerage fees in
their respective areas of operation as of December 31, 2010.
(4) The Local Water Utilities Administration is ordered to submit on or before
September 30, 2011 its plan to provide, install, operate and maintain
sewerage and sanitation facilities in said cities and towns and the completion

period for said works, which shall be fully implemented by December 31,
2020.
(5) The Department of Agriculture (DA), through the Bureau of Fisheries and
Aquatic Resources, shall submit to the Court on or before June 30, 2011 a
report on areas in Manila Bay where marine life has to be restored or
improved and the assistance it has extended to the LGUs in Metro Manila,
Rizal, Cavite, Laguna, Bulacan, Pampanga and Bataan in developing the
fisheries and aquatic resources in Manila Bay. The report shall contain
monitoring data on the marine life in said areas. Within the same period, it
shall submit its five-year plan to restore and improve the marine life in Manila
Bay, its future activities to assist the aforementioned LGUs for that purpose,
and the completion period for said undertakings.
The DA shall submit to the Court on or before September 30, 2011 the
baseline data as of September 30, 2010 on the pollution loading into the
Manila Bay system from agricultural and livestock sources.
(6) The Philippine Ports Authority (PPA) shall incorporate in its quarterly
reports the list of violators it has apprehended and the status of their cases.
The PPA is further ordered to include in its report the names, make and
capacity of the ships that dock in PPA ports. The PPA shall submit to the
Court on or before June 30, 2011 the measures it intends to undertake to
implement its compliance with paragraph 7 of the dispositive portion of the
MMDA Decision and the completion dates of such measures.
The PPA should include in its report the activities of its concessionaire that
collects and disposes of the solid and liquid wastes and other ship-generated
wastes, which shall state the names, make and capacity of the ships
serviced by it since August 2003 up to the present date, the dates the ships
docked at PPA ports, the number of days the ship was at sea with the
corresponding number of passengers and crew per trip, the volume of solid,
liquid and other wastes collected from said ships, the treatment undertaken
and the disposal site for said wastes.
(7) The Philippine National Police (PNP) Maritime Group shall submit on or
before June 30, 2011 its five-year plan of action on the measures and
activities it intends to undertake to apprehend the violators of Republic Act
No. (RA) 8550 or the Philippine Fisheries Code of 1998 and other pertinent
laws, ordinances and regulations to prevent marine pollution in Manila Bay
and to ensure the successful prosecution of violators.
The Philippine Coast Guard shall likewise submit on or before June 30, 2011
its five-year plan of action on the measures and activities they intend to
undertake to apprehend the violators of Presidential Decree No. 979 or the
Marine Pollution Decree of 1976 and RA 9993 or the Philippine Coast Guard

Law of 2009 and other pertinent laws and regulations to prevent marine
pollution in Manila Bay and to ensure the successful prosecution of violators.
(8) The Metropolitan Manila Development Authority (MMDA) shall submit to
the Court on or before June 30, 2011 the names and addresses of the
informal settlers in Metro Manila who, as of December 31, 2010, own and
occupy houses, structures, constructions and other encroachments
established or built along the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-TullahanTenejeros Rivers, and connecting waterways and esteros, in violation of RA
7279 and other applicable laws. On or before June 30, 2011, the MMDA shall
submit its plan for the removal of said informal settlers and the demolition of
the aforesaid houses, structures, constructions and encroachments, as well
as the completion dates for said activities, which shall be fully implemented
not later than December 31, 2015.

5. Brgy. Minuyan, San Jose del Monte City, Bulacan

6. Brgy. Mapalad, Santa Rosa, Nueva Ecija
7. Sub-zone Kalangitan, Clark Capas, Tarlac Special Economic Zone
Region IV-A
8. Kalayaan (Longos), Laguna
9. Brgy. Sto. Nino, San Pablo City, Laguna
10. Brgy. San Antonio (Pilotage SLF), San Pedro, Laguna
11. Morong, Rizal

The MMDA is ordered to submit a status report, within thirty (30) days from
receipt of this Resolution, on the establishment of a sanitary landfill facility for
Metro Manila in compliance with the standards under RA 9003 or the
Ecological Solid Waste Management Act.

12. Sitio Lukutan, Brgy. San Isidro, Rodriguez (Montalban), Rizal (ISWIMS)
13. Brgy. Pintong Bukawe, San Mateo, Rizal (SMSLFDC)

On or before June 30, 2011, the MMDA shall submit a report of the location
of open and controlled dumps in Metro Manila whose operations are illegal
after February 21, 2006,3 pursuant to Secs. 36 and 37 of RA 9003, and its
plan for the closure of these open and controlled dumps to be accomplished
not later than December 31, 2012. Also, on or before June 30, 2011, the
DENR Secretary, as Chairperson of the National Solid Waste Management
Commission (NSWMC), shall submit a report on the location of all open and
controlled dumps in Rizal, Cavite, Laguna, Bulacan, Pampanga and Bataan.

On or before June 30, 2011, the MMDA and the seventeen (17) LGUs in
Metro Manila are ordered to jointly submit a report on the average amount of
garbage collected monthly per district in all the cities in Metro Manila from
January 2009 up to December 31, 2010 vis--vis the average amount of
garbage disposed monthly in landfills and dumpsites. In its quarterly report
for the last quarter of 2010 and thereafter, MMDA shall report on the
apprehensions for violations of the penal provisions of RA 9003, RA 9275
and other laws on pollution for the said period.

On or before June 30, 2011, the DENR Secretary, in his capacity as NSWMC
Chairperson, shall submit a report on whether or not the following landfills
strictly comply with Secs. 41 and 42 of RA 9003 on the establishment and
operation of sanitary landfills, to wit:

On or before June 30, 2011, the DPWH and the LGUs in Rizal, Laguna,
Cavite, Bulacan, Pampanga, and Bataan shall submit the names and
addresses of the informal settlers in their respective areas who, as of
September 30, 2010, own or occupy houses, structures, constructions, and
other encroachments built along the Meycauayan-Marilao-Obando (Bulacan)
Rivers, the Talisay (Bataan) River, the Imus (Cavite) River, the Laguna de
Bay, and other rivers, connecting waterways and esteros that discharge
wastewater into the Manila Bay, in breach of RA 7279 and other applicable
laws. On or before June 30, 2011, the DPWH and the aforesaid LGUs shall
jointly submit their plan for the removal of said informal settlers and the
demolition of the aforesaid structures, constructions and encroachments, as
well as the completion dates for such activities which shall be implemented
not later than December 31, 2012.

National Capital Region

1. Navotas SLF (PhilEco), Brgy. Tanza (New Site), Navotas City
2. Payatas Controlled Dumpsite, Barangay Payatas, Quezon City
Region III
3. Sitio Coral, Brgy. Matictic, Norzagaray, Bulacan
4. Sitio Tiakad, Brgy. San Mateo, Norzagaray, Bulacan

(9) The Department of Health (DOH) shall submit to the Court on or before
June 30, 2011 the names and addresses of the owners of septic and sludge

companies including those that do not have the proper facilities for the
treatment and disposal of fecal sludge and sewage coming from septic tanks.
The DOH shall implement rules and regulations on Environmental Sanitation
Clearances and shall require companies to procure a license to operate from
the DOH.
The DOH and DENR-Environmental Management Bureau shall develop a
toxic and hazardous waste management system by June 30, 2011 which will
implement segregation of hospital/toxic/hazardous wastes and prevent
mixing with municipal solid waste.
On or before June 30, 2011, the DOH shall submit a plan of action to ensure
that the said companies have proper disposal facilities and the completion
dates of compliance.1avvphi1
(10) The Department of Education (DepEd) shall submit to the Court on or
before May 31, 2011 a report on the specific subjects on pollution prevention,
waste management, environmental protection, environmental laws and the
like that it has integrated into the school curricula in all levels for the school
year 2011-2012.
On or before June 30, 2011, the DepEd shall also submit its plan of action to
ensure compliance of all the schools under its supervision with respect to the
integration of the aforementioned subjects in the school curricula which shall
be fully implemented by June 30, 2012.
(11) All the agencies are required to submit their quarterly reports
electronically using the forms below. The agencies may add other key
performance indicators that they have identified.
SO ORDERED.

G.R. No. 170656

August 15, 2007

THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY and

BAYANI FERNANDO as Chairman of the Metropolitan Manila
Development Authority, petitioners,
vs.
VIRON TRANSPORTATION CO., INC., respondent.
x --------------------------------------------- x
G.R. No. 170657

August 15, 2007

an unreasonable exercise of police power." The second assailed Order of

November 23, 20053 denied petitioners motion for reconsideration.
The following facts are not disputed:
President Gloria Macapagal Arroyo issued the E.O. on February 10, 2003,
"Providing for the Establishment of Greater Manila Mass Transport System,"
the pertinent portions of which read:
WHEREAS, Metro Manila continues to be the center of employment
opportunities, trade and commerce of the Greater Metro Manila area;

HON. ALBERTO G. ROMULO, Executive Secretary, the METROPOLITAN

MANILA DEVELOPMENT AUTHORITY and BAYANI FERNANDO as
Chairman of the Metropolitan Manila Development Authority,
petitioners,
vs.
MENCORP TRANSPORTATION SYSTEM, INC., respondent.

WHEREAS, the traffic situation in Metro Manila has affected the adjacent
provinces of Bulacan, Cavite, Laguna, and Rizal, owing to the continued
movement of residents and industries to more affordable and economically
viable locations in these provinces;

DECISION

WHEREAS, the Metropolitan Manila Development Authority (MMDA) is

tasked to undertake measures to ease traffic congestion in Metro Manila and
ensure the convenient and efficient travel of commuters within its jurisdiction;

CARPIO MORALES, J.:

The following conditions in 1969, as observed by this Court:
Vehicles have increased in number. Traffic congestion has moved from bad
to worse, from tolerable to critical. The number of people who use the
thoroughfares has multiplied x x x,1
have remained unchecked and have reverberated to this day. Traffic jams
continue to clog the streets of Metro Manila, bringing vehicles to a standstill
at main road arteries during rush hour traffic and sapping peoples energies
and patience in the process.
The present petition for review on certiorari, rooted in the traffic congestion
problem, questions the authority of the Metropolitan Manila Development
Authority (MMDA) to order the closure of provincial bus terminals along
Epifanio de los Santos Avenue (EDSA) and major thoroughfares of Metro
Manila.
Specifically challenged are two Orders issued by Judge Silvino T. Pampilo,
Jr. of the Regional Trial Court (RTC) of Manila, Branch 26 in Civil Case Nos.
03-105850 and 03-106224.
The first assailed Order of September 8, 2005,2 which resolved a motion for
reconsideration filed by herein respondents, declared Executive Order (E.O.)
No. 179, hereafter referred to as the E.O., "unconstitutional as it constitutes

WHEREAS, a primary cause of traffic congestion in Metro Manila has been

the numerous buses plying the streets that impedes [sic] the flow of vehicles
and commuters due to the inefficient connectivity of the different transport
modes;
WHEREAS, the MMDA has recommended a plan to decongest traffic by
eliminating the bus terminals now located along major Metro Manila
thoroughfares and providing more convenient access to the mass transport
system to the commuting public through the provision of mass transport
terminal facilities that would integrate the existing transport modes, namely
the buses, the rail-based systems of the LRT, MRT and PNR and to facilitate
and ensure efficient travel through the improved connectivity of the different
transport modes;
WHEREAS, the national government must provide the necessary funding
requirements to immediately implement and render operational these
projects; and extent to MMDA such other assistance as may be warranted to
ensure their expeditious prosecution.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the
Philippines, by virtue of the powers vested in me by law, do hereby order:
Section 1. THE PROJECT. The project shall be identified as GREATER
MANILA TRANSPORT SYSTEM Project.

Section 2. PROJECT OBJECTIVES. In accordance with the plan proposed

by MMDA, the project aims to develop four (4) interim intermodal mass
transport terminals to integrate the different transport modes, as well as
those that shall hereafter be developed, to serve the commuting public in the
northwest, north, east, south, and southwest of Metro Manila. Initially, the
project shall concentrate on immediately establishing the mass transport
terminals for the north and south Metro Manila commuters as hereinafter
described.
Section 3. PROJECT IMPLEMENTING AGENCY. The Metropolitan Manila
Development Authority (MMDA), is hereby designated as the implementing
Agency for the project. For this purpose, MMDA is directed to undertake such
infrastructure development work as may be necessary and, thereafter,
manage the project until it may be turned-over to more appropriate agencies,
if found suitable and convenient. Specifically, MMDA shall have the following
functions and responsibilities:
a) Cause the preparation of the Master Plan for the projects, including the
designs and costing;
b) Coordinate the use of the land and/or properties needed for the project
with the respective agencies and/or entities owning them;
c) Supervise and manage the construction of the necessary structures and
facilities;
d) Execute such contracts or agreements as may be necessary, with the
appropriate government agencies, entities, and/or private persons, in
accordance with existing laws and pertinent regulations, to facilitate the
implementation of the project;
e) Accept, manage and disburse such funds as may be necessary for the
construction and/or implementation of the projects, in accordance with
prevailing accounting and audit polices and practice in government.
f) Enlist the assistance of any national government agency, office or
department, including local government units, government-owned or
controlled corporations, as may be necessary;
g) Assign or hire the necessary personnel for the above purposes; and
h) Perform such other related functions as may be necessary to enable it to
accomplish the objectives and purposes of this Executive Order.4 (Emphasis
in the original; underscoring supplied)

As the above-quoted portions of the E.O. noted, the primary cause of traffic
congestion in Metro Manila has been the numerous buses plying the streets
and the inefficient connectivity of the different transport modes;5 and the
MMDA had "recommended a plan to decongest traffic by eliminating the bus
terminals now located along major Metro Manila thoroughfares and providing
more and convenient access to the mass transport system to the commuting
public through the provision of mass transport terminal facilities"6 which plan
is referred to under the E.O. as the Greater Manila Mass Transport System
Project (the Project).
The E.O. thus designated the MMDA as the implementing agency for the
Project.
Pursuant to the E.O., the Metro Manila Council (MMC), the governing board
and policymaking body of the MMDA, issued Resolution No. 03-07 series of
20037 expressing full support of the Project. Recognizing the imperative to
integrate the different transport modes via the establishment of common bus
parking terminal areas, the MMC cited the need to remove the bus terminals
located along major thoroughfares of Metro Manila.8
On February 24, 2003, Viron Transport Co., Inc. (Viron), a domestic
corporation engaged in the business of public transportation with a provincial
bus operation,9 filed a petition for declaratory relief10 before the RTC11 of
Manila.
In its petition which was docketed as Civil Case No. 03-105850, Viron
alleged that the MMDA, through Chairman Fernando, was "poised to issue a
Circular, Memorandum or Order closing, or tantamount to closing, all
provincial bus terminals along EDSA and in the whole of the Metropolis
under the pretext of traffic regulation."12 This impending move, it stressed,
would mean the closure of its bus terminal in Sampaloc, Manila and two
others in Quezon City.
Alleging that the MMDAs authority does not include the power to direct
provincial bus operators to abandon their existing bus terminals to thus
deprive them of the use of their property, Viron asked the court to construe
the scope, extent and limitation of the power of the MMDA to regulate traffic
under R.A. No. 7924, "An Act Creating the Metropolitan Manila Development
Authority, Defining its Powers and Functions, Providing Funds Therefor and
For Other Purposes."
Viron also asked for a ruling on whether the planned closure of provincial bus
terminals would contravene the Public Service Act and related laws which
mandate public utilities to provide and maintain their own terminals as a
requisite for the privilege of operating as common carriers.13

Mencorp Transportation System, Inc. (Mencorp), another provincial bus

operator, later filed a similar petition for declaratory relief14 against Executive
Secretary Alberto G. Romulo and MMDA Chairman Fernando.
Mencorp asked the court to declare the E.O. unconstitutional and illegal for
transgressing the possessory rights of owners and operators of public land
transportation units over their respective terminals.
Averring that MMDA Chairman Fernando had begun to implement a plan to
close and eliminate all provincial bus terminals along EDSA and in the whole
of the metropolis and to transfer their operations to common bus terminals,15
Mencorp prayed for the issuance of a temporary restraining order (TRO)
and/or writ of preliminary injunction to restrain the impending closure of its
bus terminals which it was leasing at the corner of EDSA and New York
Street in Cubao and at the intersection of Blumentritt, Laon Laan and Halcon
Streets in Quezon City. The petition was docketed as Civil Case No. 03106224 and was raffled to Branch 47 of the RTC of Manila.
Mencorps petition was consolidated on June 19, 2003 with Virons petition
which was raffled to Branch 26 of the RTC, Manila.
Mencorps prayer for a TRO and/or writ of injunction was denied as was its
application for the issuance of a preliminary injunction.16
In the Pre-Trial Order17 issued by the trial court, the issues were narrowed
down to whether 1) the MMDAs power to regulate traffic in Metro Manila
included the power to direct provincial bus operators to abandon and close
their duly established and existing bus terminals in order to conduct business
in a common terminal; (2) the E.O. is consistent with the Public Service Act
and the Constitution; and (3) provincial bus operators would be deprived of
their real properties without due process of law should they be required to
use the common bus terminals.
Upon the agreement of the parties, they filed their respective position papers
in lieu of hearings.
By Decision18 of January 24, 2005, the trial court sustained the
constitutionality and legality of the E.O. pursuant to R.A. No. 7924, which
empowered the MMDA to administer Metro Manilas basic services including
those of transport and traffic management.
The trial court held that the E.O. was a valid exercise of the police power of
the State as it satisfied the two tests of lawful subject matter and lawful
means, hence, Virons and Mencorps property rights must yield to police
power.

On the separate motions for reconsideration of Viron and Mencorp, the trial
court, by Order of September 8, 2005, reversed its Decision, this time holding
that the E.O. was "an unreasonable exercise of police power"; that the
authority of the MMDA under Section (5)(e) of R.A. No. 7924 does not
include the power to order the closure of Virons and Mencorps existing bus
terminals; and that the E.O. is inconsistent with the provisions of the Public
Service Act.
Petitioners motion for reconsideration was denied by Resolution of
November 23, 2005.
Hence, this petition, which faults the trial court for failing to rule that: (1) the
requisites of declaratory relief are not present, there being no justiciable
controversy in Civil Case Nos. 03-105850 and 03-106224; and (2) the
President has the authority to undertake or cause the implementation of the
Project.19
Petitioners contend that there is no justiciable controversy in the cases for
declaratory relief as nothing in the body of the E.O. mentions or orders the
closure and elimination of bus terminals along the major thoroughfares of
Metro Manila. Viron and Mencorp, they argue, failed to produce any letter or
communication from the Executive Department apprising them of an
immediate plan to close down their bus terminals.
And petitioners maintain that the E.O. is only an administrative directive to
government agencies to coordinate with the MMDA and to make available for
use government property along EDSA and South Expressway corridors.
They add that the only relation created by the E.O. is that between the Chief
Executive and the implementing officials, but not between third persons.
The petition fails.
It is true, as respondents have pointed out, that the alleged deficiency of the
consolidated petitions to meet the requirement of justiciability was not among
the issues defined for resolution in the Pre-Trial Order of January 12, 2004. It
is equally true, however, that the question was repeatedly raised by
petitioners in their Answer to Virons petition,20 their Comment of April 29,
2003 opposing Mencorps prayer for the issuance of a TRO,21 and their
Position Paper of August 23, 2004.22
In bringing their petitions before the trial court, both respondents pleaded the
existence of the essential requisites for their respective petitions for
declaratory relief,23 and refuted petitioners contention that a justiciable
controversy was lacking.24 There can be no denying, therefore, that the
issue was raised and discussed by the parties before the trial court.

The following are the essential requisites for a declaratory relief petition: (a)
there must be a justiciable controversy; (b) the controversy must be between
persons whose interests are adverse; (c) the party seeking declaratory relief
must have a legal interest in the controversy; and (d) the issue invoked must
be ripe for judicial determination.25
The requirement of the presence of a justiciable controversy is satisfied when
an actual controversy or the ripening seeds thereof exist between the parties,
all of whom are sui juris and before the court, and the declaration sought will
help in ending the controversy.26 A question becomes justiciable when it is
translated into a claim of right which is actually contested.27
In the present cases, respondents resort to court was prompted by the
issuance of the E.O. The 4th Whereas clause of the E.O. sets out in clear
strokes the MMDAs plan to "decongest traffic by eliminating the bus
terminals now located along major Metro Manila thoroughfares and providing
more convenient access to the mass transport system to the commuting
public through the provision of mass transport terminal facilities x x x."
(Emphasis supplied)
Section 2 of the E.O. thereafter lays down the immediate establishment of
common bus terminals for north- and south-bound commuters. For this
purpose, Section 8 directs the Department of Budget and Management to
allocate funds of not more than one hundred million pesos (P100,000,000) to
cover the cost of the construction of the north and south terminals. And the
E.O. was made effective immediately.
The MMDAs resolve to immediately implement the Project, its denials to the
contrary notwithstanding, is also evident from telltale circumstances,
foremost of which was the passage by the MMC of Resolution No. 03-07,
Series of 2003 expressing its full support of the immediate implementation of
the Project.
Notable from the 5th Whereas clause of the MMC Resolution is the plan to
"remove the bus terminals located along major thoroughfares of Metro
Manila and an urgent need to integrate the different transport modes." The
7th Whereas clause proceeds to mention the establishment of the North and
South terminals.

Under the circumstances, for respondents to wait for the actual issuance by
the MMDA of an order for the closure of respondents bus terminals would be
foolhardy for, by then, the proper action to bring would no longer be for
declaratory relief which, under Section 1, Rule 6330 of the Rules of Court,
must be brought before there is a breach or violation of rights.
As for petitioners contention that the E.O. is a mere administrative issuance
which creates no relation with third persons, it does not persuade. Suffice it
to stress that to ensure the success of the Project for which the concerned
government agencies are directed to coordinate their activities and
resources, the existing bus terminals owned, operated or leased by third
persons like respondents would have to be eliminated; and respondents
would be forced to operate from the common bus terminals.
It cannot be gainsaid that the E.O. would have an adverse effect on
respondents. The closure of their bus terminals would mean, among other
things, the loss of income from the operation and/or rentals of stalls thereat.
Precisely, respondents claim a deprivation of their constitutional right to
property without due process of law.
Respondents have thus amply demonstrated a "personal and substantial
interest in the case such that [they have] sustained, or will sustain, direct
injury as a result of [the E.O.s] enforcement."31 Consequently, the
established rule that the constitutionality of a law or administrative issuance
can be challenged by one who will sustain a direct injury as a result of its
enforcement has been satisfied by respondents.
On to the merits of the case.
Respondents posit that the MMDA is devoid of authority to order the
elimination of their bus terminals under the E.O. which, they argue, is
unconstitutional because it violates both the Constitution and the Public
Service Act; and that neither is the MMDA clothed with such authority under
R.A. No. 7924.

As alleged in Virons petition, a diagram of the GMA-MTS North Bus/Rail

Terminal had been drawn up, and construction of the terminal is already in
progress. The MMDA, in its Answer28 and Position Paper,29 in fact affirmed
that the government had begun to implement the Project.

Petitioners submit, however, that the real issue concerns the Presidents
authority to undertake or to cause the implementation of the Project. They
assert that the authority of the President is derived from E.O. No. 125,
"Reorganizing the Ministry of Transportation and Communications Defining
its Powers and Functions and for Other Purposes," her residual power and/or
E.O. No. 292, otherwise known as the Administrative Code of 1987. They
add that the E.O. is also a valid exercise of the police power.

It thus appears that the issue has already transcended the boundaries of
what is merely conjectural or anticipatory.lawphil

E.O. No. 125,32 which former President Corazon Aquino issued in the
exercise of legislative powers, reorganized the then Ministry (now

Department) of Transportation and Communications. Sections 4, 5, 6 and 22

of E.O. 125, as amended by E.O. 125-A,33 read:
SECTION 4. Mandate. The Ministry shall be the primary policy, planning,
programming, coordinating, implementing, regulating and administrative
entity of the Executive Branch of the government in the promotion,
development and regulation of dependable and coordinated networks of
transportation and communication systems as well as in the fast, safe,
efficient and reliable postal, transportation and communications services.
To accomplish such mandate, the Ministry shall have the following
objectives:
(a) Promote the development of dependable and coordinated networks of
transportation and communications systems;
(b) Guide government and private investment in the development of the
countrys intermodal transportation and communications systems in a most
practical, expeditious, and orderly fashion for maximum safety, service, and
cost effectiveness; (Emphasis and underscoring supplied)

SECTION 6. Authority and Responsibility. The authority and responsibility

for the exercise of the mandate of the Ministry and for the discharge of its
powers and functions shall be vested in the Minister of Transportation and
Communications, hereinafter referred to as the Minister, who shall have
supervision and control over the Ministry and shall be appointed by the
President. (Emphasis and underscoring supplied)
SECTION 22. Implementing Authority of Minister. The Minister shall issue
such orders, rules, regulations and other issuances as may be necessary to
ensure the effective implementation of the provisions of this Executive Order.
(Emphasis and underscoring supplied)
It is readily apparent from the abovequoted provisions of E.O. No. 125, as
amended, that the President, then possessed of and exercising legislative
powers, mandated the DOTC to be the primary policy, planning,
programming, coordinating, implementing, regulating and administrative
entity to promote, develop and regulate networks of transportation and
communications. The grant of authority to the DOTC includes the power to
establish and administer comprehensive and integrated programs for
transportation and communications.

xxxx
SECTION 5. Powers and Functions. To accomplish its mandate, the
Ministry shall have the following powers and functions:
(a) Formulate and recommend national policies and guidelines for the
preparation and implementation of integrated and comprehensive
transportation and communications systems at the national, regional and
local levels;
(b) Establish and administer comprehensive and integrated programs for
transportation and communications, and for this purpose, may call on any
agency, corporation, or organization, whether public or private, whose
development programs include transportation and communications as an
integral part thereof, to participate and assist in the preparation and
implementation of such program;
(c) Assess, review and provide direction to transportation and
communications research and development programs of the government in
coordination with other institutions concerned;
(d) Administer all laws, rules and regulations in the field of transportation and
communications; (Emphasis and underscoring supplied)
xxxx

As may be seen further, the Minister (now Secretary) of the DOTC is vested
with the authority and responsibility to exercise the mandate given to the
department. Accordingly, the DOTC Secretary is authorized to issue such
orders, rules, regulations and other issuances as may be necessary to
ensure the effective implementation of the law.
Since, under the law, the DOTC is authorized to establish and administer
programs and projects for transportation, it follows that the President may
exercise the same power and authority to order the implementation of the
Project, which admittedly is one for transportation.
Such authority springs from the Presidents power of control over all
executive departments as well as the obligation for the faithful execution of
the laws under Article VII, Section 17 of the Constitution which provides:
SECTION 17. The President shall have control of all the executive
departments, bureaus and offices. He shall ensure that the laws be faithfully
executed.
This constitutional provision is echoed in Section 1, Book III of the
Administrative Code of 1987. Notably, Section 38, Chapter 37, Book IV of the
same Code defines the Presidents power of supervision and control over the
executive departments, viz:

SECTION 38. Definition of Administrative Relationships. Unless otherwise

expressly stated in the Code or in other laws defining the special
relationships of particular agencies, administrative relationships shall be
categorized and defined as follows:
(1) Supervision and Control. Supervision and control shall include
authority to act directly whenever a specific function is entrusted by law or
regulation to a subordinate; direct the performance of duty; restrain the
commission of acts; review, approve, reverse or modify acts and decisions of
subordinate officials or units; determine priorities in the execution of plans
and programs. Unless a different meaning is explicitly provided in the specific
law governing the relationship of particular agencies the word "control" shall
encompass supervision and control as defined in this paragraph. x x x
(Emphasis and underscoring supplied)
Thus, whenever a specific function is entrusted by law or regulation to a
subordinate, the President may act directly or merely direct the performance
of a duty.34
Respecting the Presidents authority to order the implementation of the
Project in the exercise of the police power of the State, suffice it to stress that
the powers vested in the DOTC Secretary to establish and administer
comprehensive and integrated programs for transportation and
communications and to issue orders, rules and regulations to implement
such mandate (which, as previously discussed, may also be exercised by the
President) have been so delegated for the good and welfare of the people.
Hence, these powers partake of the nature of police power.
Police power is the plenary power vested in the legislature to make, ordain,
and establish wholesome and reasonable laws, statutes and ordinances, not
repugnant to the Constitution, for the good and welfare of the people.35 This
power to prescribe regulations to promote the health, morals, education,
good order or safety, and general welfare of the people flows from the
recognition that salus populi est suprema lex the welfare of the people is
the supreme law.
While police power rests primarily with the legislature, such power may be
delegated, as it is in fact increasingly being delegated.36 By virtue of a valid
delegation, the power may be exercised by the President and administrative
boards37 as well as by the lawmaking bodies of municipal corporations or
local governments under an express delegation by the Local Government
Code of 1991.38
The authority of the President to order the implementation of the Project
notwithstanding, the designation of the MMDA as the implementing agency

for the Project may not be sustained. It is ultra vires, there being no legal
basis therefor.
It bears stressing that under the provisions of E.O. No. 125, as amended, it is
the DOTC, and not the MMDA, which is authorized to establish and
implement a project such as the one subject of the cases at bar. Thus, the
President, although authorized to establish or cause the implementation of
the Project, must exercise the authority through the instrumentality of the
DOTC which, by law, is the primary implementing and administrative entity in
the promotion, development and regulation of networks of transportation, and
the one so authorized to establish and implement a project such as the
Project in question.
By designating the MMDA as the implementing agency of the Project, the
President clearly overstepped the limits of the authority conferred by law,
rendering E.O. No. 179 ultra vires.
In another vein, the validity of the designation of MMDA flies in the absence
of a specific grant of authority to it under R.A. No. 7924.
To recall, R.A. No. 7924 declared the Metropolitan Manila area39 as a
"special development and administrative region" and placed the
administration of "metro-wide" basic services affecting the region under the
MMDA.
Section 2 of R.A. No. 7924 specifically authorizes the MMDA to perform
"planning, monitoring and coordinative functions, and in the process exercise
regulatory and supervisory authority over the delivery of metro-wide
services," including transport and traffic management.40 Section 5 of the
same law enumerates the powers and functions of the MMDA as follows:
(a) Formulate, coordinate and regulate the implementation of medium and
long-term plans and programs for the delivery of metro-wide services, land
use and physical development within Metropolitan Manila, consistent with
national development objectives and priorities;
(b) Prepare, coordinate and regulate the implementation of medium-term
investment programs for metro-wide services which shall indicate sources
and uses of funds for priority programs and projects, and which shall include
the packaging of projects and presentation to funding institutions;
(c) Undertake and manage on its own metro-wide programs and projects for
the delivery of specific services under its jurisdiction, subject to the approval
of the Council. For this purpose, MMDA can create appropriate project
management offices;

(d) Coordinate and monitor the implementation of such plans, programs and
projects in Metro Manila; identify bottlenecks and adopt solutions to problems
of implementation;
(e) The MMDA shall set the policies concerning traffic in Metro Manila, and
shall coordinate and regulate the implementation of all programs and projects
concerning traffic management, specifically pertaining to enforcement,
engineering and education. Upon request, it shall be extended assistance
and cooperation, including but not limited to, assignment of personnel, by all
other government agencies and offices concerned;
(f) Install and administer a single ticketing system, fix, impose and collect
fines and penalties for all kinds of violations of traffic rules and regulations,
whether moving or non-moving in nature, and confiscate and suspend or
revoke drivers licenses in the enforcement of such traffic laws and
regulations, the provisions of RA 4136 and PD 1605 to the contrary
notwithstanding. For this purpose, the Authority shall impose all traffic laws
and regulations in Metro Manila, through its traffic operation center, and may
deputize members of the PNP, traffic enforcers of local government units,
duly licensed security guards, or members of non-governmental
organizations to whom may be delegated certain authority, subject to such
conditions and requirements as the Authority may impose; and

the MMDA may install and administer a single ticketing system," fix, impose
and collect fines and penalties for all traffic violations.
It will be noted that the powers of the MMDA are limited to the following acts:
formulation,
coordination,
regulation,
implementation,
preparation,
management, monitoring, setting of policies, installation of a system and
administration. There is no syllable in R.A. No. 7924 that grants the MMDA
police power, let alone legislative power. Even the Metro Manila Council has
not been delegated any legislative power. Unlike the legislative bodies of the
local government units, there is no provision in R.A. No. 7924 that empowers
the MMDA or its Council to enact ordinances, approve resolutions and
appropriate funds for the general welfare of the inhabitants of Metro Manila.
The MMDA is, as termed in the charter itself, a development authority. It is
an agency created for the purpose of laying down policies and coordinating
with the various national government agencies, peoples organizations, nongovernmental organizations and the private sector for the efficient and
expeditious delivery of basic services in the vast metropolitan area. All its
functions are administrative in nature and these are actually summed up in
the charter itself, viz:
SECTION 2. Creation of the Metropolitan Manila Development Authority. .
..

(g) Perform other related functions required to achieve the objectives of the
MMDA, including the undertaking of delivery of basic services to the local
government units, when deemed necessary subject to prior coordination with
and consent of the local government unit concerned." (Emphasis and
underscoring supplied)

The MMDA shall perform planning, monitoring and coordinative functions,

and in the process exercise regulatory and supervisory authority over the
delivery of metro-wide services within Metro Manila, without diminution of the
autonomy of the local government units concerning purely local matters.42
(Emphasis and underscoring supplied)

The scope of the function of MMDA as an administrative, coordinating and

policy-setting body has been settled in Metropolitan Manila Development
Authority (MMDA) v. Bel-Air Village Association, Inc.41 In that case, the
Court stressed:

In light of the administrative nature of its powers and functions, the MMDA is
devoid of authority to implement the Project as envisioned by the E.O; hence,
it could not have been validly designated by the President to undertake the
Project. It follows that the MMDA cannot validly order the elimination of
respondents terminals.

Clearly, the scope of the MMDAs function is limited to the delivery of the
seven (7) basic services. One of these is transport and traffic management
which includes the formulation and monitoring of policies, standards and
projects to rationalize the existing transport operations, infrastructure
requirements, the use of thoroughfares and promotion of the safe movement
of persons and goods. It also covers the mass transport system and the
institution of a system of road regulation, the administration of all traffic
enforcement operations, traffic engineering services and traffic education
programs, including the institution of a single ticketing system in Metro
Manila for traffic violations. Under this service, the MMDA is expressly
authorized to "to set the policies concerning traffic" and "coordinate and
regulate the implementation of all traffic management programs." In addition,

Even the MMDAs claimed authority under the police power must necessarily
fail in consonance with the above-quoted ruling in MMDA v. Bel-Air Village
Association, Inc. and this Courts subsequent ruling in Metropolitan Manila
Development Authority v. Garin43 that the MMDA is not vested with police
power.
Even assuming arguendo that police power was delegated to the MMDA, its
exercise of such power does not satisfy the two tests of a valid police power
measure, viz: (1) the interest of the public generally, as distinguished from
that of a particular class, requires its exercise; and (2) the means employed
are reasonably necessary for the accomplishment of the purpose and not

unduly oppressive upon individuals.44 Stated differently, the police power

legislation must be firmly grounded on public interest and welfare and a
reasonable relation must exist between the purposes and the means.
As early as Calalang v. Williams,45 this Court recognized that traffic
congestion is a public, not merely a private, concern. The Court therein held
that public welfare underlies the contested statute authorizing the Director of
Public Works to promulgate rules and regulations to regulate and control
traffic on national roads.
Likewise, in Luque v. Villegas,46 this Court emphasized that public welfare
lies at the bottom of any regulatory measure designed "to relieve congestion
of traffic, which is, to say the least, a menace to public safety."47 As such,
measures calculated to promote the safety and convenience of the people
using the thoroughfares by the regulation of vehicular traffic present a proper
subject for the exercise of police power.
Notably, the parties herein concede that traffic congestion is a public concern
that needs to be addressed immediately. Indeed, the E.O. was issued due to
the felt need to address the worsening traffic congestion in Metro Manila
which, the MMDA so determined, is caused by the increasing volume of
buses plying the major thoroughfares and the inefficient connectivity of
existing transport systems. It is thus beyond cavil that the motivating force
behind the issuance of the E.O. is the interest of the public in general.
Are the means employed appropriate and reasonably necessary for the
accomplishment of the purpose. Are they not duly oppressive?
With the avowed objective of decongesting traffic in Metro Manila, the E.O.
seeks to "eliminate[e] the bus terminals now located along major Metro
Manila thoroughfares and provid[e] more convenient access to the mass
transport system to the commuting public through the provision of mass
transport terminal facilities x x x."48 Common carriers with terminals along
the major thoroughfares of Metro Manila would thus be compelled to close
down their existing bus terminals and use the MMDA-designated common
parking areas.
In Lucena Grand Central Terminal, Inc. v. JAC Liner, Inc.,49 two city
ordinances were passed by the Sangguniang Panlungsod of Lucena,
directing public utility vehicles to unload and load passengers at the Lucena
Grand Central Terminal, which was given the exclusive franchise to operate
a single common terminal. Declaring that no other terminals shall be situated,
constructed, maintained or established inside or within the city of Lucena, the
sanggunian declared as inoperable all temporary terminals therein.

The ordinances were challenged before this Court for being unconstitutional
on the ground that, inter alia, the measures constituted an invalid exercise of
police power, an undue taking of private property, and a violation of the
constitutional prohibition against monopolies.
Citing De la Cruz v. Paras50 and Lupangco v. Court of Appeals,51 this Court
held that the assailed ordinances were characterized by overbreadth, as they
went beyond what was reasonably necessary to solve the traffic problem in
the city. And it found that the compulsory use of the Lucena Grand Terminal
was unduly oppressive because it would subject its users to fees, rentals and
charges.
The true role of Constitutional Law is to effect an equilibrium between
authority and liberty so that rights are exercised within the framework of the
law and the laws are enacted with due deference to rights.
A due deference to the rights of the individual thus requires a more careful
formulation of solutions to societal problems.
From the memorandum filed before this Court by petitioner, it is gathered that
the Sangguniang Panlungsod had identified the cause of traffic congestion to
be the indiscriminate loading and unloading of passengers by buses on the
streets of the city proper, hence, the conclusion that the terminals contributed
to the proliferation of buses obstructing traffic on the city streets.
Bus terminals per se do not, however, impede or help impede the flow of
traffic. How the outright proscription against the existence of all terminals,
apart from that franchised to petitioner, can be considered as reasonably
necessary to solve the traffic problem, this Court has not been enlightened. If
terminals lack adequate space such that bus drivers are compelled to load
and unload passengers on the streets instead of inside the terminals, then
reasonable specifications for the size of terminals could be instituted, with
permits to operate the same denied those which are unable to meet the
specifications.
In the subject ordinances, however, the scope of the proscription against the
maintenance of terminals is so broad that even entities which might be able
to provide facilities better than the franchised terminal are barred from
operating at all. (Emphasis and underscoring supplied)
As in Lucena, this Court fails to see how the prohibition against the existence
of respondents terminals can be considered a reasonable necessity to ease
traffic congestion in the metropolis. On the contrary, the elimination of
respondents bus terminals brings forth the distinct possibility and the equally
harrowing reality of traffic congestion in the common parking areas, a case of
transference from one site to another.

Less intrusive measures such as curbing the proliferation of "colorum" buses,

vans and taxis entering Metro Manila and using the streets for parking and
passenger pick-up points, as respondents suggest, might even be more
effective in easing the traffic situation. So would the strict enforcement of
traffic rules and the removal of obstructions from major thoroughfares.
As to the alleged confiscatory character of the E.O., it need only to be stated
that respondents certificates of public convenience confer no property right,
and are mere licenses or privileges.52 As such, these must yield to
legislation safeguarding the interest of the people.
Even then, for reasons which bear reiteration, the MMDA cannot order the
closure of respondents terminals not only because no authority to implement
the Project has been granted nor legislative or police power been delegated
to it, but also because the elimination of the terminals does not satisfy the
standards of a valid police power measure.
Finally, an order for the closure of respondents terminals is not in line with
the provisions of the Public Service Act.
Paragraph (a), Section 13 of Chapter II of the Public Service Act (now
Section 5 of Executive Order No. 202, creating the Land Transportation
Franchising and Regulatory Board or LFTRB) vested the Public Service
Commission (PSC, now the LTFRB) with "x x x jurisdiction, supervision and
control over all public services and their franchises, equipment and other
properties x x x."
Consonant with such grant of authority, the PSC was empowered to "impose
such conditions as to construction, equipment, maintenance, service, or
operation as the public interests and convenience may reasonably require"53
in approving any franchise or privilege.
Further, Section 16 (g) and (h) of the Public Service Act54 provided that the
Commission shall have the 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:
(g) To compel any public service to furnish safe, adequate, and proper
service as regards the manner of furnishing the same as well as the
maintenance of the necessary material and equipment.
(h) To require any public service to establish, construct, maintain, and
operate any reasonable extension of its existing facilities, where in the
judgment of said Commission, such extension is reasonable and practicable
and will furnish sufficient business to justify the construction and

maintenance of the same and when the financial condition of the said public
service reasonably warrants the original expenditure required in making and
operating such extension.(Emphasis and underscoring supplied)
The establishment, as well as the maintenance of vehicle parking areas or
passenger terminals, is generally considered a necessary service to be
provided by provincial bus operators like respondents, hence, the
investments they have poured into the acquisition or lease of suitable
terminal sites. Eliminating the terminals would thus run counter to the
provisions of the Public Service Act.
This Court commiserates with the MMDA for the roadblocks thrown in the
way of its efforts at solving the pestering problem of traffic congestion in
Metro Manila. These efforts are commendable, to say the least, in the face of
the abominable traffic situation of our roads day in and day out. This Court
can only interpret, not change, the law, however. It needs only to be
reiterated that it is the DOTC as the primary policy, planning,
programming, coordinating, implementing, regulating and administrative
entity to promote, develop and regulate networks of transportation and
communications which has the power to establish and administer a
transportation project like the Project subject of the case at bar.
No matter how noble the intentions of the MMDA may be then, any plan,
strategy or project which it is not authorized to implement cannot pass
muster.
WHEREFORE, the Petition is, in light of the foregoing disquisition, DENIED.
E.O. No. 179 is declared NULL and VOID for being ultra vires.
SO ORDERED.
Puno, C.J., Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio,
Austria-Martinez, Corona, Azcuna, Tinga, Chico-Nazario, Garcia, Velasco,
Jr., Nachura, Reyes, JJ., concur.

G.R. No. 166501

November 16, 2006

ERNESTO B. FRANCISCO, JR., Petitioner,

vs.
HON. BAYANI F. FERNANDO, in his capacity as Chairman of the
Metropolitan Manila Development Authority, and METROPOLITAN
MANILA DEVELOPMENT AUTHORITY, Respondents.
RESOLUTION
CARPIO, J.:
Petitioner Ernesto B. Francisco, Jr. ("petitioner"), as member of the
Integrated Bar of the Philippines and taxpayer, filed this original action for the
issuance of the writs of Prohibition and Mandamus. Petitioner prays for the
Prohibition writ to enjoin respondents Bayani F. Fernando, Chairman of the
Metropolitan Manila Development Authority (MMDA) and the MMDA
("respondents") from further implementing its "wet flag scheme" ("Flag
Scheme").1 The Mandamus writ is to compel respondents to "respect and
uphold the x x x rights of pedestrians to due process x x x and equal
protection of the laws x x x."
Petitioner contends that the Flag Scheme: (1) has no legal basis because the
MMDAs governing body, the Metro Manila Council, did not authorize it; (2)
violates the Due Process Clause because it is a summary punishment for
jaywalking; (3) disregards the Constitutional protection against cruel,
degrading, and inhuman punishment; and (4) violates "pedestrian rights" as it
exposes pedestrians to various potential hazards.2
In their Comment, respondents sought the dismissal of the petition for
petitioners lack of standing to litigate and for violation of the doctrine of
hierarchy of courts. Alternatively, respondents contended that the Flag
Scheme is a valid preventive measure against jaywalking.

injury.3 On the other hand, a party suing as a taxpayer must specifically

show that he has a sufficient interest in preventing the illegal expenditure of
money raised by taxation and that he will sustain a direct injury as a result of
the enforcement of the questioned statute.4 Petitioner meets none of the
requirements under either category.
Nor is there merit to petitioners claim that the Court should relax the
standing requirement because of the "transcendental importance" of the
issues the petition raises. As an exception to the standing requirement, the
transcendental importance of the issues raised relates to the merits of the
petition.5 Thus, the party invoking it must show, among others, the presence
of a clear disregard of a constitutional or statutory prohibition.6 Petitioner has
not shown such clear constitutional or statutory violation.
On the Flag Schemes alleged lack of legal basis, we note that all the cities
and municipalities within the MMDAs jurisdiction,7 except Valenzuela City,
have each enacted anti-jaywalking ordinances or traffic management codes
with provisions for pedestrian regulation. Such fact serves as sufficient basis
for respondents implementation of schemes, or ways and means, to enforce
the anti-jaywalking ordinances and similar regulations. After all, the MMDA is
an administrative agency tasked with the implementation of rules and
regulations enacted by proper authorities.8 The absence of an antijaywalking ordinance in Valenzuela City does not detract from this conclusion
absent any proof that respondents implemented the Flag Scheme in that city.
Further, the petition ultimately calls for a factual determination of whether the
Flag Scheme is a reasonable enforcement of anti-jaywalking ordinances and
similar enactments. This Court is not a trier of facts.9 The petition proffers
mere surmises and speculations on the potential hazards of the Flag
Scheme. This Court cannot determine the reasonableness of the Flag
Scheme based on mere surmises and speculations.1wphi1

Petitioner filed a Reply, claiming that the Court should take cognizance of the
case as it raises issues of "paramount and transcendental importance."
Petitioner also contended that he filed this petition directly with the Court
because the issues raised in the petition deserve the "direct x x x intervention
of the x x x [C]ourt x x x."

Lastly, petitioner violated the doctrine of hierarchy of courts when he filed this
petition directly with us. This Courts jurisdiction to issue writs of certiorari,
prohibition, mandamus, quo warranto, and habeas corpus, while concurrent
with the Regional Trial Courts and the Court of Appeals, does not give
litigants unrestrained freedom of choice of forum from which to seek such
relief.10 We relax this rule only in exceptional and compelling
circumstances.11 This is not the case here.

We dismiss the petition.

WHEREFORE, we DISMISS the petition.

A citizen can raise a constitutional question only when (1) he can show that
he has personally suffered some actual or threatened injury because of the
allegedly illegal conduct of the government; (2) the injury is fairly traceable to
the challenged action; and (3) a favorable action will likely redress the

SO ORDERED.

[G.R. No. 89651. November 10, 1989.]

DATU FIRDAUSI I.Y. ABBAS, DATU BLO UMPAR ADIONG, DATU
MACALIMPOWAC DELANGALEN, CELSO PALMA, ALI MONTAHA
BABAO, JULMUNIR JANNARAL, RASHID SABER, and DATU JAMAL
ASHLEY ABBAS, representing the other taxpayers of Mindanao,
Petitioners, v. COMMISSION ON ELECTIONS, and HONORABLE
GUILLERMO C. CARAGUE, DEPARTMENT SECRETARY OF BUDGET
AND MANAGEMENT, Respondents.
[G.R. No. 89965. November 10, 1989.]
ATTY. ABDULLAH D. MAMA-O, Petitioner, v. HON. GUILLERMO
CARAGUE, in his capacity as the Secretary of the Budget, and the
COMMISSION ON ELECTIONS, Respondents.
Abbas, Abbas, Amora, Alejandro-Abbas & Associates for petitioners in G.R.
Nos. 89651 and 89965.
Abdullah D. Mama-o for and in his own behalf in 89965.
1.
CONSTITUTIONAL LAW; REPUBLIC ACT NO. 6734 (AN ACT
PROVIDING FOR AN ORGANIC ACT FOR AUTONOMOUS REGION IN
MUSLIM MINDANAO); STANDARD FOR INQUIRY INTO ITS VALIDITY,
PROVIDED FOR IN THE CONSTITUTION, NOT THE PROVISIONS OF
THE TRIPOLI AGREEMENT. It is now the Constitution itself that provides
for the creation of an autonomous region in Muslim Mindanao. The standard
for any inquiry into the validity of R.A. No. 6734 would therefore be what is so
provided in the Constitution. Thus, any conflict between the provisions of
R.A. No. 6734 and the provisions of the Tripoli Agreement will not have the
effect
of
enjoining
the
implementation
of
the
Organic
Act.chanroblesvirtuallawlibrary
2.
ID.; ID.; AN AMENDMENT TO THE TRIPOLI AGREEMENT.
Assuming for the sake of argument that the Tripoli Agreement is a binding
treaty or international agreement, it would then constitute part of the law of
the land. But as internal law it would not be superior to R.A. No. 6734, an
enactment of the Congress of the Philippines, rather it would be in the same
class as the latter [SALONGA, PUBLIC INTERNATIONAL LAW 320 (4th ed.,
1974), citing Head Money Cases, 112 U.S. 580 (1884) and Foster v. Nelson,
2 Pet. 253 (1829)]. Thus, if at all, R.A. No. 6734 would be amendatory of the
Tripoli Agreement, being a subsequent law.
3.
ID.; ID.; CREATION OF THE AUTONOMOUS REGION SHALL
TAKE EFFECT ONLY WHEN APPROVED BY A MAJORITY OF THE
VOTES CAST BY THE CONSTITUENTS UNITS IN A PLEBISCITE.

Under the Constitution and R.A. No. 6734, the creation of the autonomous
region shall take effect only when approved by a majority of the votes cast by
the constituent units in a plebiscite, and only those provinces and cities
where a majority vote in favor of the Organic Act shall be included in the
autonomous region.
4.
ID.; ID.; ID.; MAJORITY VOTE IN EACH CONSTITUENT UNITS,
EMPHASIZED. Comparing Article XVIII, Section 27 of the Constitution
with the provision on the creation of the autonomous region under Art. X,
sec. 18. parag. 2, it will readily be seen that the creation of the autonomous
region made to depend, not on the total majority vote in the plebiscite, but on
the will of the majority in each of the constituent units and the proviso
underscores this. For if the intention of the framers of the Constitution was to
get the majority of the totality of the votes cast, they could have simply
adopted the same phraseology as that used for the ratification of the
Constitution, i.e. "the creation of the autonomous region shall be effective
when approved by a majority of the votes cast in a plebiscite called for the
purpose." It is thus clear that what is required by the Constitution is a simple
majority of votes approving the Organic Act in individual constituent units and
not a double majority of the votes in all constituent units put together, as well
as in the individual constituent units.
5.
ID.; ID.; ASCERTAINMENT BY CONGRESS OF THE AREAS THAT
SHOULD CONSTITUTE THE AUTONOMOUS REGION, A POLITICAL
QUESTION. The Constitution lays down the standards by which Congress
shall determine which areas should constitute the autonomous region.
Guided by these constitutional criteria, the ascertainment by Congress of the
areas that share common attributes is within the exclusive realm of the
legislatures discretion. Any review of this ascertainment would have to go
into the wisdom of the law. This the Court cannot do without doing violence
to the separation of governmental powers.chanroblesvirtualawlibrary
6.
ID.; BILL OF RIGHTS; EQUAL PROTECTION CLAUSE; PERMITS
OF REASONABLE CLASSIFICATION; CASE AT BAR. Equal protection
permits of reasonable classification. In Dumlao v. Commission on Elections
[G.R. No. 52245, January 22, 1980, 95 SCRA 392], the Court ruled that one
class may be treated differently from another where the groupings are based
on reasonable and real distinctions. The guarantee of equal protection is thus
not infringed in this case, the classification having been made by Congress
on the basis of substantial distinctions as set forth by the Constitution itself.
7.
ID.; JUDICIAL POWER; ACTUAL CONTROVERSY, ESSENTIAL.
As enshrined in the Constitution, judicial power includes the duty to settle
actual controversies involving rights which are legally demandable and
enforceable [Art. VIII, Sec. 1]. As a condition precedent for the power to be
exercised, an actual controversy between litigants must first exist.

8.
ID.; ID.; ID.; CASE AT BAR. In the present case, no actual
controversy between real litigants exists. There are no conflicting claims
involving the application of national law resulting in an alleged violation of
religious freedom. This being so, the Court in this case may not be called
upon to resolve what is merely a perceived potential conflict between the
provisions of the Muslim Code and national law.
9.
ID.; ADMINISTRATIVE REGIONS, CONSTRUED. Administrative
regions are not territorial and political subdivisions like provinces, cities,
municipalities and barangays [see Art. X, sec. 1 of the Constitution]. They are
mere groupings of contiguous provinces for administrative purposes
[Integrated Reorganization Plan (1972), which was made as part of the law of
the land by Pres. Dec. No. 1, Pres. Sec. No. 742].
10.
ID.; PRESIDENT; POWER TO MERGE ADMINISTRATIVE
REGIONS; NOT IN CONFLICT WITH THE CONSTITUTIONAL PROVISION
REQUIRING A PLEBISCITE IN THE MERGER OF LOCAL GOVERNMENT
UNITS. While the power to merge administrative regions is not expressly
provided for in the Constitution, it is a power which has traditionally been
lodged with the President to facilitate the exercise of the power of general
supervision over local governments [see Art. X, sec. 4 of the Constitution].
There is no conflict between the power of the President to merge
administrative regions with the constitutional provision requiring a plebiscite
in the merger of local government units because the requirement of a
plebiscite in a merger expressly applies only to provinces, cities,
municipalities or barangays, not to administrative regions.
11.
ID.; REPUBLIC ACT NO. 6734; ORGANIZATION OF THE
OVERSIGHT COMMITTEE, WILL NOT DELAY THE CREATION OF THE
AUTONOMOUS REGION. Under the Constitution, the creation of the
autonomous region hinges only on the result of the plebiscite. If the Organic
Act is approved by majority of the votes cast by constituent units in the
scheduled plebiscite, the creation of the autonomous region immediately
takes effect. The questioned provisions in R.A. No. 6734 requiring an
Oversight Committee to supervise the transfer do not provide for a different
date of effectivity. Much less would the organization of the Oversight
Committee cause an impediment to the operation of the Organic Act, for
such is evidently aimed at effecting a smooth transition period for the
regional government.
12.
REMEDIAL LAW; BURDEN OF PROOF AND PRESUMPTIONS;
EVERY LAW HAS IN ITS FAVOR THE PRESUMPTION OF
CONSTITUTIONALITY; CASE AT BAR. Every law has in its favor the
presumption of constitutionality. Those who petition this Court to declare a

law, or parts thereof, unconstitutional must clearly establish the basis for
such a declaration. Otherwise, their petition must fail.
DECISION
CORTES, J.:
The present controversy relates to the plebiscite in thirteen (13) provinces
and nine (9) cities in Mindanao and Palawan, 1 scheduled for November 19,
1989, in implementation of Republic Act No. 6734, entitled "An Act Providing
for an Organic Act for the Autonomous Region in Muslim Mindanao."cralaw
virtua1aw library
These consolidated petitions pray that the Court: (1) enjoin the Commission
on Elections (COMELEC) from conducting the plebiscite and the Secretary of
Budget and Management from releasing funds to the COMELEC for that
purpose; and (2) declare R.A. No. 6734, or parts thereof, unconstitutional.
After a consolidated comment was filed by the Solicitor General for the
respondents, which the Court considered as the answer, the case was
deemed submitted for decision, the issues having been joined.
Subsequently, petitioner Mama-o filed a "Manifestation with Motion for Leave
to File Reply on Respondents Comment and to Open Oral Arguments,"
which the Court noted.
The arguments against R.A. No. 6734 raised by petitioners may generally be
categorized into either of the following:chanrob1es virtual 1aw library
(a)

that R.A. 6734, or parts thereof, violates the Constitution, and

(b)
that certain provisions of R.A. No. 6734 conflict with the Tripoli
Agreement.
The Tripoli Agreement, more specifically, the Agreement Between the
Government of the Republic of the Philippines and Moro National Liberation
Front with the Participation of the Quadripartite Ministerial Commission
Members of the Islamic Conference and the Secretary General of the
Organization of Islamic Conference" took effect on December 23, 1976. It
provided for" [t]he establishment of Autonomy in the Southern Philippines
within the realm of the sovereignty and territorial integrity of the Republic of
the Philippines" and enumerated the thirteen (13) provinces comprising the
"areas of autonomy." 2
In 1987, a new Constitution was ratified, which for the first time provided for
regional autonomy. Article X, section 15 of the charter provides that" [t]here
shall be created autonomous regions in Muslim Mindanao and in the

Cordilleras consisting of provinces, cities, municipalities, and geographical

areas sharing common and distinctive historical and cultural heritage,
economic and social structures, and other relevant characteristics within the
framework of this Constitution and the national sovereignty as well as
territorial
integrity
of
the
Republic
of
the
Philippines."
chanroblesvirtuallawlibrary
To effectuate this mandate, the Constitution further provides:chanrob1es
virtual 1aw library
Sec. 16.
The President shall exercise general supervision over
autonomous regions to ensure that the laws are faithfully executed.
Sec. 17.
All powers, functions, and responsibilities not granted by this
Constitution or by law to the autonomous regions shall be vested in the
National Government.
Sec. 18.
The Congress shall enact an organic act for each
autonomous region with the assistance and participation of the regional
consultative commission composed of representatives appointed by the
President from a list of nominees from multisectoral bodies. The organic act
shall define the basic structure of government for the region consisting of the
executive department and legislative assembly, both of which shall be
elective and representative of the constituent political units. The organic acts
shall likewise provide for special courts with personal, family, and property
law jurisdiction consistent with the provisions of this Constitution and national
laws.
The creation of the autonomous region shall be effective when approved by
majority of the votes cast by the constituent units in a plebiscite called for the
purpose, provided that only the provinces, cities, and geographic areas
voting favorably in such plebiscite shall be included in the autonomous
region.
Sec. 19.
The first Congress elected under this Constitution shall,
within eighteen months from the time of organization of both Houses, pass
the organic acts for the autonomous regions in Muslim Mindanao and the
Cordilleras.
Sec. 20.
Within its territorial jurisdiction and subject to the provisions
of this Constitution and national laws, the organic act of autonomous regions
shall provide for legislative powers over:chanrob1es virtual 1aw library
(1)

Administrative organization;

(2)

Creation of sources of revenues;

(3)

Ancestral domain and natural resources;

(4)

Personal, family, and property relations;

(5)

Regional urban and rural planning development;

(6)

Economic, social and tourism development;

(7)

Educational policies;

(8)

Preservation and development of the cultural heritage; and

(9)
Such other matters as may be authorized by law for the promotion of
the general welfare of the people of the region.
Sec. 21.
The preservation of peace and order within the regions shall
be the responsibility of the local police agencies which shall be organized,
maintained, supervised, and utilized in accordance with applicable laws. The
defense and security of the region shall be the responsibility of the National
Government.chanrobles lawlibrary : rednad
Pursuant to the constitutional mandate, R.A. No. 6734 was enacted and
signed into law on August 1, 1989.
1.
The Court shall dispose first of the second category of arguments
raised by petitioners, i.e. that certain provisions of R.A. No. 6734 conflict with
the provisions of the Tripoli Agreement.
Petitioners premise their arguments on the assumption that the Tripoli
Agreement is part of the law of the land, being a binding international
agreement. The Solicitor General asserts that the Tripoli Agreement is
neither a binding treaty, not having been entered into by the Republic of the
Philippines with a sovereign state and ratified according to the provisions of
the 1973 or 1987 Constitutions, nor a binding international agreement.
We find it neither necessary nor determinative of the case to rule on the
nature of the Tripoli Agreement and its binding effect on the Philippine
Government whether under public international or internal Philippine law. In
the first place, it is now the Constitution itself that provides for the creation of
an autonomous region in Muslim Mindanao. The standard for any inquiry into
the validity of R.A. No. 6734 would therefore be what is so provided in the
Constitution. Thus, any conflict between the provisions of R.A. No. 6734 and
the provisions of the Tripoli Agreement will not have the effect of enjoining
the implementation of the Organic Act. Assuming for the sake of argument
that the Tripoli Agreement is a binding treaty or international agreement, it

would then constitute part of the law of the land. But as internal law it would
not be superior to R.A. No. 6734, an enactment of the Congress of the
Philippines, rather it would be in the same class as the latter [SALONGA,
PUBLIC INTERNATIONAL LAW 320 (4th ed., 1974), citing Head Money
Cases, 112 U.S. 580 (1884) and Foster v. Nelson, 2 Pet. 253 (1829)]. Thus,
if at all, R.A. No. 6734 would be amendatory of the Tripoli Agreement, being
a subsequent law. Only a determination by this Court that R.A. No. 6734
contravenes the Constitution would result in the granting of the reliefs sought.
3
2.
The Court shall therefore only pass upon the constitutional questions
which have been raised by petitioners.
Petitioner Abbas argues that R.A. No. 6734 unconditionally creates an
autonomous region in Mindanao, contrary to the aforequoted provisions of
the Constitution on the autonomous region which make the creation of such
region dependent upon the outcome of the plebiscite.cralawnad
In support of his argument, petitioner cites Article II, section 1(1) of R.A. No.
6734 which declares that" [t]here is hereby created the Autonomous Region
in Muslim Mindanao, to be composed of provinces and cities voting favorably
in the plebiscite called for the purpose, in accordance with Section 18, Article
X of the Constitution." Petitioner contends that the tenor of the above
provision makes the creation of an autonomous region absolute, such that
even if only two provinces vote in favor of autonomy, an autonomous region
would still be created composed of the two provinces where the favorable
votes were obtained.
The matter of the creation of the autonomous region and its composition
needs to be clarified.
First, the questioned provision itself in R.A. No. 6734 refers to Section 18,
Article X of the Constitution which sets forth the conditions necessary for the
creation of the autonomous region. The reference to the constitutional
provision cannot be glossed over for it clearly indicates that the creation of
the autonomous region shall take place only in accord with the constitutional
requirements. Second, there is a specific provision in the Transitory
Provisions (Article XIX) of the Organic Act, which incorporates substantially
the same requirements embodied in the Constitution and fills in the details,
thus:chanrob1es virtual 1aw library
SEC. 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.
Thus, under the Constitution and R.A. No. 6734, the creation of the
autonomous region shall take effect only when approved by a majority of the
votes cast by the constituent units in a plebiscite, and only those provinces
and cities where a majority vote in favor of the Organic Act shall be included
in the autonomous region. The provinces and cities wherein such a majority
is not attained shall not be included in the autonomous region. It may be that
even if an autonomous region is created, not all of the thirteen (13) provinces
and nine (9) cities mentioned in Article II, section 1(2) of R.A. No. 6734 shall
be included therein. The single plebiscite contemplated by the Constitution
and R.A. No. 6734 will therefore be determinative of (1) whether there shall
be an autonomous region in Muslim Mindanao and (2) which provinces and
cities, among those enumerated in R.A. No. 6734, shall comprise it. [See III
RECORD OF THE CONSTITUTIONAL COMMISSION 487-492 (1986)].
As provided in the Constitution, the creation of the autonomous region in
Muslim Mindanao is made effective upon the approval "by majority of the
votes cast by the constituent units in a plebiscite called for the purpose" [Art.
X, sec. 18]. The question has been raised as to what this majority means.
Does it refer to a majority of the total votes cast in the plebiscite in all the
constituent units, or a majority in each of the constituent units, or both?
We need not go beyond the Constitution to resolve this question.
If the framers of the Constitution intended to require approval by a majority of
all the votes cast in the plebiscite they would have so indicated. Thus, in
Article XVIII, section 27, it is provided that" [t]his Constitution shall take effect
immediately upon its ratification by a majority of the votes cast in a plebiscite
held for the purpose. . . ." Comparing this with the provision on the creation
of the autonomous region, which reads:chanrob1es virtual 1aw library
The creation of the autonomous region shall be effective when approved by
majority of the votes cast by the constituent units in a plebiscite called for the
purpose, provided that only provinces, cities and geographic areas voting,
favorably in such plebiscite shall be included in the autonomous region. [Art.
X, sec. 18, para. 2].chanrobles.com : virtual law library
it will readily be seen that the creation of the autonomous region is made to
depend, not on the total majority vote in the plebiscite, but on the will of the
majority in each of the constituent units and the proviso underscores this. For

if the intention of the framers of the Constitution was to get the majority of the
totality of the votes cast, they could have simply adopted the same
phraseology as that used for the ratification of the Constitution, i.e. "the
creation of the autonomous region shall be effective when approved by a
majority of the votes cast in a plebiscite called for the purpose."cralaw
virtua1aw library
It is thus clear that what is required by the Constitution is a simple majority of
votes approving the Organic Act in individual constituent units and not a
double majority of the votes in all constituent units put together, as well as in
the individual constituent units.
More importantly, because of its categorical language, this is also the sense
in which the vote requirement in the plebiscite provided under Article X,
section 18 must have been understood by the people when they ratified the
Constitution.
Invoking the earlier cited constitutional provisions, petitioner Mama-o, on the
other hand, maintains that only those areas which, to his view, share
common and distinctive historical and natural heritage, economic and social
structures, and other relevant characteristics should be properly included
within the coverage of the autonomous region. He insists that R.A. No. 6734
is unconstitutional because only the provinces of Basilan, Sulu, Tawi-Tawi,
Lanao del Sur, Lanao del Norte and Maguindanao and the cities of Marawi
and Cotabato, and not all of the thirteen (13) provinces and nine (9) cities
included in the Organic Act, possess such concurrence in historical and
cultural heritage and other relevant characteristics. By including areas which
do not strictly share the same characteristics as the others, petitioner claims
that Congress has expanded the scope of the autonomous region which the
Constitution itself has prescribed to be limited.
Petitioners argument is not tenable. The Constitution lays down the
standards by which Congress shall determine which areas should constitute
the autonomous region. Guided by these constitutional criteria, the
ascertainment by Congress of the areas that share common attributes is
within the exclusive realm of the legislatures discretion. Any review of this
ascertainment would have to go into the wisdom of the law. This the Court
cannot do without doing violence to the separation of governmental powers.
[Angara v. Electoral Commission, 63 Phil. 139 (1936); Morfe v. Mutuc, G.R.
No. L-20387, January 31, 1968, 22 SCRA 424].
After assailing the inclusion of non-Muslim areas in the Organic Act for lack
of basis, petitioner Mama-o would then adopt the extreme view that other
non-Muslim areas in Mindanao should likewise be covered. He argues that
since the Organic Act covers several non-Muslim areas, its scope should be
further broadened to include the rest of the non-Muslim areas in Mindanao in

order for the others to similarly enjoy the benefits of autonomy. Petitioner
maintains that the failure of R.A. No. 6734 to include the other non-Muslim
areas denies said areas equal protection of the law, and therefore is violative
of the Constitution.
Petitioners contention runs counter to the very same constitutional provision
he had earlier invoked. Any determination by Congress of what areas in
Mindanao should comprise the autonomous region, taking into account
shared historical and cultural heritage, economic and social structures, and
other relevant characteristics, would necessarily carry with it the exclusion of
other areas. As earlier stated, such determination by Congress of which
areas should be covered by the organic act for the autonomous region
constitutes a recognized legislative prerogative, whose wisdom may not be
inquired into by this Court.
Moreover, equal protection permits of reasonable classification [People v.
Vera, 65 Phil. 56 (1936); Laurel v. Misa, 76 Phil. 372 (1946); J.M. Tuason
and Co. v. Land Tenure Administration, G.R. No. L-21064, February 18,
1970, 31 SCRA 413]. In Dumlao v. Commission on Elections [G.R. No.
52245, January 22, 1980, 95 SCRA 392], the Court ruled that one class may
be treated differently from another where the groupings are based on
reasonable and real distinctions. The guarantee of equal protection is thus
not infringed in this case, the classification having been made by Congress
on the basis of substantial distinctions as set forth by the Constitution itself.
Both petitions also question the validity of R.A. No. 6734 on the ground that it
violates the constitutional guarantee on free exercise of religion [Art. III, sec.
5]. The objection centers on a provision in the Organic Act which mandates
that should there be any conflict between the Muslim Code [P.D. No. 1083]
and the Tribal Code (still to be enacted) on the one hand, and the national
law on the other hand, the Shariah courts created under the same Act
should apply national law. Petitioners maintain that the Islamic Law
(Shariah) is derived from the Koran, which makes it part of divine law. Thus
it may not be subjected to any "man-made" national law. Petitioner Abbas
supports this objection by enumerating possible instances of conflict between
provisions of the Muslim Code and national law, wherein an application of
national
law
might
be
offensive
to
a
Muslims
religious
convictions.chanrobles.com : virtual law library
As enshrined in the Constitution, judicial power includes the duty to settle
actual controversies involving rights which are legally demandable and
enforceable [Art. VIII, Sec. 1]. As a condition precedent for the power to be
exercised, an actual controversy between litigants must first exist [Angara v.
Electoral Commission, supra; Tan v. Macapagal, G.R. No. L-34161, February
29, 1972, 43 SCRA 677]. In the present case, no actual controversy between
real litigants exists. There are no conflicting claims involving the application

of national law resulting in an alleged violation of religious freedom. This

being so, the Court in this case may not be called upon to resolve what is
merely a perceived potential conflict between the provisions of the Muslim
Code and national law.
Petitioners also impugn the constitutionality of Article XIX, section 13 of R.A.
No. 6734 which, among others, states:chanrob1es virtual 1aw library

autonomous region of the powers, appropriations, and properties vested

upon the regional government by the Organic Act [Art. XIX, Secs. 3 and 4].
Said provisions mandate that the transfer of certain national government
offices and their properties to the regional government shall be made
pursuant to a schedule prescribed by the Oversight Committee, and that
such transfer should be accomplished within six (6) years from the
organization of the regional government.

. . . 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.

It is asserted by petitioners that such provisions are unconstitutional because

while the Constitution states that the creation of the autonomous region shall
take effect upon approval in a plebiscite, the requirement of organizing an
Oversight Committee tasked with supervising the transfer of powers and
properties to the regional government would in effect delay the creation of
the autonomous region.

According to petitioners, said provision grants the President the power to

merge regions, a power which is not conferred by the Constitution upon the
President. That the President may choose to merge existing regions
pursuant to the Organic Act is challenged as being in conflict with Article X,
Section 10 of the Constitution which provides:chanrob1es virtual 1aw library

Under the Constitution, the creation of the autonomous region hinges only on
the result of the plebiscite. If the Organic Act is approved by majority of the
votes cast by constituent units in the scheduled plebiscite, the creation of the
autonomous region immediately takes effect. The questioned provisions in
R.A. No. 6734 requiring an Oversight Committee to supervise the transfer do
not provide for a different date of effectivity. Much less would the
organization of the Oversight Committee cause an impediment to the
operation of the Organic Act, for such is evidently aimed at effecting a
smooth transition period for the regional government. The constitutional
objection on this point thus cannot be sustained as there is no basis
therefor.chanrobles.com:cralaw:red

No province, city, municipality, or barangay may be created, divided, merged,

abolished, or its boundary substantially altered, except in accordance with
the criteria established in the local government code and subject to approval
by a majority of the votes cast in a plebiscite in the political units directly
affected.
It must be pointed out that what is referred to in R.A. No. 6734 is the merger
of administrative regions, i.e. Regions I to XII and the National Capital
Region, which are mere groupings of contiguous provinces for administrative
purposes [Integrated Reorganization Plan (1972), which was made as part of
the law of the land by Pres. Dec. No. 1, Pres. Sec. No. 742]. Administrative
regions are not territorial and political subdivisions like provinces, cities,
municipalities and barangays [see Art. X, sec. 1 of the Constitution]. While
the power to merge administrative regions is not expressly provided for in the
Constitution, it is a power which has traditionally been lodged with the
President to facilitate the exercise of the power of general supervision over
local governments [see Art. X, sec. 4 of the Constitution]. There is no conflict
between the power of the President to merge administrative regions with the
constitutional provision requiring a plebiscite in the merger of local
government units because the requirement of a plebiscite in a merger
expressly applies only to provinces, cities, municipalities or barangays, not to
administrative regions.
Petitioners likewise question the validity of provisions in the Organic Act
which create an Oversight Committee to supervise the transfer to the

Every law has in its favor the presumption of constitutionality [Yu Cong Eng
v. Trinidad, 47 Phil. 387 (1925); Salas v. Jarencio, G.R. No. L-29788, August
30, 1979, 46 SCRA 734; Morfe v. Mutuc, supra; Peralta v. COMELEC, G.R.
No. L-47771, March 11, 1978, 82 SCRA 30]. Those who petition this Court to
declare a law, or parts thereof, unconstitutional must clearly establish the
basis for such a declaration. Otherwise, their petition must fail. Based on the
grounds raised by petitioners to challenge the constitutionality of R.A. No.
6734, the Court finds that petitioners have failed to overcome the
presumption. The dismissal of these two petitions is, therefore, inevitable.
WHEREFORE, the petitions are DISMISSED for lack of merit.
SO ORDERED.
Fernan, C.J., Narvasa, Gutierrez, Jr ., Cruz, Paras, Feliciano, Gancayco,
Padilla, Bidin, Sarmiento, Grio-Aquino, Medialdea and Regalado, JJ.,
concur.
Melencio-Herrera, J., is on leave.

G.R. No. 96754 June 22, 1995

CONGRESSMAN JAMES L. CHIONGBIAN (Third District, South
Cotobato) ADELBERT W. ANTONINO (First District, South Cotobato),
WILFREDO G. CAINGLET (Third District, Zamboanga del Norte),
HILARION RAMIRO, JR. (Second Division, Misamis Occidental),
ERNESTO S. AMATONG (Second District, Zamboanga del Norte), ALVIN
G. DANS (Lone District, Basilan), ABDULLAH M. DIMAPORO (Second
District, Lanao del Norte), and CONGRESSWOMAN MARIA CLARA A.
LOBREGAT (Lone District, Zamboanga City) petitioners,
vs.
HON. OSCAR M. ORBOS, Executive Secretary; COMMITTEE CHAIRMAN
SEC. FIDEL V. RAMOS, CABINET OFFICERS FOR REGIONAL
DEVELOPMENT FOR REGIONS X AND XII, CHAIRMAN OF THE
REGIONAL DEVELOPMENT COUNCIL FOR REGION X, CHAIRMAN
JESUS V. AYALA, CABINET OFFICERS FOR REGIONAL
DEVELOPMENT FOR REGIONS XI and XII, DEPARTMENT OF LOCAL
GOVERNMENT, NATIONAL ECONOMIC AND DEVELOPMENT
AUTHORITY SECRETARIAT, PRESIDENTIAL MANAGEMENT STAFF,
HON. GUILLERMO CARAGUE, Secretary of the DEPARTMENT OF
BUDGET and MANAGEMENT; and HON. ROSALINA S. CAJUCUM, OIC
National Treasurer, respondents.
IMMANUEL JALDON, petitioner,
vs.
HON. EXECUTIVE SECRETARY OSCAR M. ORBOS, HON. FIDEL
RAMOS, HON. SECRETARY LUIS SANTOS, AND HON. NATIONAL
TREASURER ROSALINA CAJUCOM, respondents.
MENDOZA, J.:
These suits challenge the validity of a provision of the Organic Act for the
Autonomous Region in Muslim Mindanao (R.A. No. 6734), authorizing the
President of the Philippines to "merge" by administrative determination the
regions remaining after the establishment of the Autonomous Region, and
the Executive Order issued by the President pursuant to such authority,
"Providing for the Reorganization of Administrative Regions in Mindanao." A
temporary restraining order prayed for by the petitioners was issued by this
Court on January 29, 1991, enjoining the respondents from enforcing the
Executive Order and statute in question.

Davao del Sur, Lanao del Norte, Lanao del Sur, Maguindanao, Palawan,
South Cotabato, Sultan Kudarat, Sulu, Tawi-Tawi, Zamboanga del Norte,
and Zamboanga del Sur, and the cities of Cotabato, Dapitan, Dipolog,
General Santos, Iligan, Marawi, Pagadian, Puerto Princesa and Zamboanga.
In the ensuing plebiscite held on November 16, 1989, four provinces voted in
favor of creating an autonomous region. These are the provinces of Lanao
del Sur, Maguindanao, Sulu and Tawi-Tawi. In accordance with the
constitutional provision, these provinces became the Autonomous Region in
Muslim Mindanao.
On the other hand, with respect to provinces and cities not voting in favor of
the Autonomous Region, Art. XIX, 13 of R.A. No. 6734 provides,
That only the provinces and cities voting favorably in such plebiscites 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 this provision, then President Corazon
C. Aquino issued on October 12, 1990 Executive Order No. 429, "providing
for the Reorganization of the Administrative Regions in Mindanao." Under
this Order, as amended by E.O. No. 439
(1)
Misamis Occidental, at present part of Region X, will become part of
Region IX.
(2)
Oroquieta City, Tangub City and Ozamiz City, at present parts of
Region X will become parts of Region IX.
(3)
South Cotobato, at present a part of Region XI, will become part of
Region XII.
(4)
General Santos City, at present part of Region XI, will become part
of Region XII.
(5)
Lanao del Norte, at present part of Region XII, will become part of
Region IX.

The facts are as follows:

(6)
Iligan City and Marawi City, at present part of Region XII, will
become part of Region IX.

Pursuant to Art. X, 18 of the 1987 Constitution, Congress passed R.A. No.

6734, the Organic Act for the Autonomous Region in Muslim Mindanao,
calling for a plebiscite to be held in the provinces of Basilan, Cotobato,

Petitioners in G.R. No. 96754 are, or at least at the time of the filing of their
petition, members of Congress representing various legislative districts in
South Cotobato, Zamboanga del Norte, Basilan, Lanao del Norte and

Zamboanga City. On November 12, 1990, they wrote then President Aquino
protesting E.O. No. 429. They contended that
There is no law which authorizes the President to pick certain provinces and
cities within the existing regions some of which did not even take part in
the plebiscite as in the case of the province of Misamis Occidental and the
cities of Oroquieta, Tangub and Ozamiz and restructure them to new
administrative regions. On the other hand, the law (Sec. 13, Art. XIX, R.A.
6734) is specific to the point, that is, that "the provinces and cities which in
the plebiscite do not vote for inclusion in the Autonomous Region shall
remain in the existing administrative regions."
The transfer of the provinces of Misamis Occidental from Region X to Region
IX; Lanao del Norte from Region XII to Region IX, and South Cotobato from
Region XI to Region XII are alterations of the existing structures of
governmental units, in other words, reorganization. This can be gleaned from
Executive Order No. 429, thus
Whereas, there is an urgent need to reorganize the administrative regions in
Mindanao to guarantee the effective delivery of field services of government
agencies taking into consideration the formation of the Autonomous Region
in Muslim Mindanao.
With due respect to Her Excellency, we submit that while the authority
necessarily includes the authority to merge, the authority to merge does not
include the authority to reorganize. Therefore, the President's authority under
RA 6734 to "merge existing regions" cannot be construed to include the
authority to reorganize them. To do so will violate the rules of statutory
construction.
The transfer of regional centers under Executive Order 429 is actually a
restructuring (reorganization) of administrative regions. While this
reorganization, as in Executive Order 429, does not affect the apportionment
of congressional representatives, the same is not valid under the penultimate
paragraph of Sec. 13, Art. XIX of R.A. 6734 and Ordinance appended to the
1986 Constitution apportioning the seats of the House of Representatives of
Congress of the Philippines to the different legislative districts in provinces
and cities. 1
As their protest went unheeded, while Inauguration Ceremonies of the New
Administrative Region IX were scheduled on January 26, 1991, petitioners
brought this suit for certiorari and prohibition.
On the other hand, the petitioner in G.R. No. 96673, Immanuel Jaldon, is a
resident of Zamboanga City, who is suing in the capacity of taxpayer and
citizen of the Republic of the Philippines.

Petitioners in both cases contend that Art. XIX, 13 of R.A. No. 6734 is
unconstitutional because (1) it unduly delegates legislative power to the
President by authorizing him to "merge [by administrative determination] the
existing regions" or at any rate provides no standard for the exercise of the
power delegated and (2) the power granted is not expressed in the title of the
law.
In addition, petitioner in G.R. No. 96673 challenges the validity of E.O. No.
429 on the ground that the power granted by Art. XIX, 13 to the President is
only to "merge regions IX and XII" but not to reorganize the entire
administrative regions in Mindanao and certainly not to transfer the regional
center of Region IX from Zamboanga City to Pagadian City.
The Solicitor General defends the reorganization of regions in Mindanao by
E.O. No. 429 as merely the exercise of a power "traditionally lodged in the
President," as held in Abbas v. Comelec, 2 and as a mere incident of his
power of general supervision over local governments and control of
executive departments, bureaus and offices under Art. X, 16 and Art. VII,
17, respectively, of the Constitution.
He contends that there is no undue delegation of legislative power but only a
grant of the power to "fill up" or provide the details of legislation because
Congress did not have the facility to provide for them. He cites by analogy
the case of Municipality of Cardona v. Municipality of Binangonan, 3 in which
the power of the Governor-General to fix municipal boundaries was
sustained on the ground that
[such power] is simply a transference of certain details with respect to
provinces, municipalities, and townships, many of them newly created, and
all of them subject to a more or less rapid change both in development and
centers of population, the proper regulation of which might require not only
prompt action but action of such a detailed character as not to permit the
legislative body, as such, to take it efficiently.
The Solicitor General justifies the grant to the President of the power "to
merge the existing regions" as something fairly embraced in the title of R.A.
No. 6734, to wit, "An Act Providing for an Organic Act for the Autonomous
Region in Muslim Mindanao," because it is germane to it.
He argues that the power is not limited to the merger of those regions in
which the provinces and cities which took part in the plebiscite are located
but that it extends to all regions in Mindanao as necessitated by the
establishment of the autonomous region.

Finally, he invokes P.D. No. 1416, as amended by P.D. No. 1772 which
provides:
1.
The President of the Philippines shall have the continuing authority
to reorganize the National Government. In exercising this authority, the
President shall be guided by generally acceptable principles of good
government and responsive national government, including but not limited to
the following guidelines for a more efficient, effective, economical and
development-oriented governmental framework:
(a)

(1)
whether the power to "merge" administrative regions is legislative in
character, as petitioners contend, or whether it is executive in character, as
respondents claim it is, and, in any event, whether Art. XIX, 13 is invalid
because it contains no standard to guide the President's discretion;
(2)
and

whether the power given is fairly expressed in the title of the statute;

More effective planning implementation, and review functions;

(b)
Greater decentralization and responsiveness in decision-making
process;
(c)
Further minimization, if not, elimination, of duplication or overlapping
of purposes, functions, activities, and programs;
(d)
Further development of as standardized as possible ministerial, subministerial and corporate organizational structures;
(e)

Considering the arguments of the parties, the issues are:

Further development of the regionalization process; and

(f)
Further rationalization of the functions of and administrative
relationships among government entities.
For purposes of this Decree, the coverage of the continuing authority of the
President to reorganize shall be interpreted to encompass all agencies,
entities, instrumentalities, and units of the National Government, including all
government owned or controlled corporations as well as the entire range of
the powers, functions, authorities, administrative relationships, acid related
aspects pertaining to these agencies, entities, instrumentalities, and units.
2.

[T]he President may, at his discretion, take the following actions:

xxx

xxx

(3)
whether the power granted authorizes the reorganization even of
regions the provinces and cities in which either did not take part in the
plebiscite on the creation of the Autonomous Region or did not vote in favor
of it; and
(4)
whether the power granted to the President includes the power to
transfer the regional center of Region IX from Zamboanga City to Pagadian
City.
It will be useful to recall first the nature of administrative regions and the
basis and purpose for their creation. On September 9, 1968, R.A. No. 5435
was passed "authorizing the President of the Philippines, with the help of a
Commission on Reorganization, to reorganize the different executive
departments, bureaus, offices, agencies and instrumentalities of the
government, including banking or financial institutions and corporations
owned or controlled by it." The purpose was to promote "simplicity, economy
and efficiency in the government." 4 The Commission on Reorganization
created under the law was required to submit an integrated reorganization
plan not later than December 31, 1969 to the President who was in turn
required to submit the plan to Congress within forty days after the opening of
its next regular session. The law provided that any reorganization plan
submitted would become effective only upon the approval of Congress. 5

f.
Create, abolish, group, consolidate, merge, or integrate entities,
agencies, instrumentalities, and units of the National Government, as well as
expand, amend, change, or otherwise modify their powers, functions and
authorities, including, with respect to government-owned or controlled
corporations, their corporate life, capitalization, and other relevant aspects of
their charters.

Accordingly, the Reorganization Commission prepared an Integrated

Reorganization Plan which divided the country into eleven administrative
regions. 6 By P.D. No. 1, the Plan was approved and made part of the law of
the land on September 24, 1972. P.D. No. 1 was twice amended in 1975,
first by P.D. No. 742 which "restructur[ed] the regional organization of
Mindanao, Basilan, Sulu and Tawi-Tawi" and later by P.D. No. 773 which
further "restructur[ed] the regional organization of Mindanao and divid[ed]
Region IX into two sub-regions." In 1978, P.D. No. 1555 transferred the
regional center of Region IX from Jolo to Zamboanga City.

g.
Take such other related actions as may be necessary to carry out
the purposes and objectives of this Decree.

Thus the creation and subsequent reorganization of administrative regions

have been by the President pursuant to authority granted to him by law. In

xxx

conferring on the President the power "to merge [by administrative

determination] the existing regions" following the establishment of the
Autonomous Region in Muslim Mindanao, Congress merely followed the
pattern set in previous legislation dating back to the initial organization of
administrative regions in 1972. The choice of the President as delegate is
logical because the division of the country into regions is intended to facilitate
not only the administration of local governments but also the direction of
executive departments which the law requires should have regional offices.
As this Court observed in Abbas, "while the power to merge administrative
regions is not expressly provided for in the Constitution, it is a power which
has traditionally been lodged with the President to facilitate the exercise of
the power of general supervision over local governments [see Art. X, 4 of
the Constitution]." The regions themselves are not territorial and political
divisions like provinces, cities, municipalities and barangays but are "mere
groupings of contiguous provinces for administrative purposes." 7 The power
conferred on the President is similar to the power to adjust municipal
boundaries 8 which has been described in Pelaez v. Auditor General 9 or as
"administrative in nature."

Nor is Art. XIX, 13 susceptible to charge that its subject is not embraced in
the title of R.A. No. 6734. The constitutional requirement that "every bill
passed by the Congress shall embrace only one subject which shall be
expressed in the title thereof" 13 has always been given a practical rather
than a technical construction. The title is not required to be an index of the
content of the bill. It is a sufficient compliance with the constitutional
requirement if the title expresses the general subject and all provisions of the
statute are germane to that subject. 14 Certainly the reorganization of the
remaining administrative regions is germane to the general subject of R.A.
No. 6734, which is the establishment of the Autonomous Region in Muslim
Mindanao.

There is, therefore, no abdication by Congress of its legislative power in

conferring on the President the power to merge administrative regions. The
question is whether Congress has provided a sufficient standard by which
the President is to be guided in the exercise of the power granted and
whether in any event the grant of power to him is included in the subject
expressed in the title of the law.

The questioned Executive Order No. 429 distorted and, in fact, contravened
the clear intent of this provision by moving out or transferring certain political
subdivisions (provinces/cities) out of their legally designated regions.
Aggravating this unacceptable or untenable situation is EO No. 429's
effecting certain movements on areas which did not even participate in the
November 19, 1989 plebiscite. The unauthorized action of the President, as
effected by and under the questioned EO No. 429, is shown by the following
dispositions: (1) Misamis Occidental, formerly of Region X and which did not
even participate in the plebiscite, was moved from said Region X to Region
IX; (2) the cities of Ozamis, Oroquieta, and Tangub, all formerly belonging to
Region X, which likewise did not participate in the said plebiscite, were
transferred to Region IX; (3) South Cotobato, from Region XI to Region XII;
(4) General Santos City: from Region XI to Region XII; (5) Lanao del Norte,
from Region XII to Region IX; and (6) the cities of Marawi and Iligan from
Region XII to Region IX. All of the said provinces and cities voted "NO", and
thereby rejected their entry into the Autonomous Region in Muslim
Mindanao, as provided under RA No. 6734. 15

First, the question of standard. A legislative standard need not be expressed.

It may simply be gathered or implied. 10 Nor need it be found in the law
challenged because it may be embodied in other statutes on the same
subject as that of the challenged legislation. 11
With respect to the power to merge existing administrative regions, the
standard is to be found in the same policy underlying the grant to the
President in R.A. No. 5435 of the power to reorganize the Executive
Department, to wit: "to promote simplicity, economy and efficiency in the
government to enable it to pursue programs consistent with national goals for
accelerated social and economic development and to improve the service in
the transaction of the public business." 12 Indeed, as the original eleven
administrative regions were established in accordance with this policy, it is
logical to suppose that in authorizing the President to "merge [by
administrative determination] the existing regions" in view of the withdrawal
from some of those regions of the provinces now constituting the
Autonomous Region, the purpose of Congress was to reconstitute the
original basis for the organization of administrative regions.

Finally, it is contended that the power granted to the President is limited to

the reorganization of administrative regions in which some of the provinces
and cities which voted in favor of regional autonomy are found, because Art.
XIX, 13 provides that those which did not vote for autonomy "shall remain in
the existing administrative regions." More specifically, petitioner in G.R. No.
96673 claims:

The contention has no merit. While Art. XIX, 13 provides that "The
provinces and cities which do not vote for inclusion in the Autonomous
Region shall remain in the existing administrative regions," this provision is
subject to the qualification that "the President may by administrative
determination merge the existing regions." This means that while nonassenting provinces and cities are to remain in the regions as designated
upon the creation of the Autonomous Region, they may nevertheless be
regrouped with contiguous provinces forming other regions as the exigency
of administration may require.

The regrouping is done only on paper. It involves no more than are definition
or redrawing of the lines separating administrative regions for the purpose of
facilitating the administrative supervision of local government units by the
President and insuring the efficient delivery of essential services. There will
be no "transfer" of local governments from one region to another except as
they may thus be regrouped so that a province like Lanao del Norte, which is
at present part of Region XII, will become part of Region IX.
The regrouping of contiguous provinces is not even analogous to a
redistricting or to the division or merger of local governments, which all have
political consequences on the right of people residing in those political units
to vote and to be voted for. It cannot be overemphasized that administrative
regions are mere groupings of contiguous provinces for administrative
purposes, not for political representation.
Petitioners nonetheless insist that only those regions, in which the provinces
and cities which voted for inclusion in the Autonomous Region are located,
can be "merged" by the President.
To be fundamental reason Art. XIX, 13 is not so limited. But the more
fundamental reason is that the President's power cannot be so limited
without neglecting the necessities of administration. It is noteworthy that the
petitioners do not claim that the reorganization of the regions in E.O. No. 429
is irrational. The fact is that, as they themselves admit, the reorganization of
administrative regions in E.O. No. 429 is based on relevant criteria, to wit: (1)
contiguity and geographical features; (2) transportation and communication
facilities; (3) cultural and language groupings; (4) land area and population;
(5) existing regional centers adopted by several agencies; (6) socioeconomic development programs in the regions and (7) number of provinces
and cities.
What has been said above applies to the change of the regional center from
Zamboanga City to Pagadian City. Petitioners contend that the determination
of provincial capitals has always been by act of Congress. But as, this Court
said in Abbas, 16 administrative regions are mere "groupings of contiguous
provinces for administrative purposes, . . . [They] are not territorial and
political subdivisions like provinces, cities, municipalities and barangays."
There is, therefore, no basis for contending that only Congress can change
or determine regional centers. To the contrary, the examples of P.D. Nos. 1,
742, 773 and 1555 suggest that the power to reorganize administrative
regions carries with it the power to determine the regional center.
It may be that the transfer of the regional center in Region IX from
Zamboanga City to Pagadian City may entail the expenditure of large sums
of money for the construction of buildings and other infrastructure to house

regional offices. That contention is addressed to the wisdom of the transfer

rather than to its legality and it is settled that courts are not the arbiters of the
wisdom or expediency of legislation. In any event this is a question that we
will consider only if fully briefed and upon a more adequate record than that
presented by petitioners.
WHEREFORE, the petitions for certiorari and prohibition are DISMISSED for
lack of merit.
SO ORDERED.
Narvasa, C.J., Feliciano, Padilla, Regalado, Davide, Jr., Romero, Bellosillo,
Melo, Quiason, Puno, Vitug, Kapunan and Francisco, JJ., concur.

[G.R. No. 196271 : October 18, 2011]

DATU MICHAEL ABAS KIDA, IN HIS PERSONAL CAPACITY, AND IN
REPRESENTATION OF MAGUINDANAO FEDERATION OF
AUTONOMOUS IRRIGATORS ASSOCIATION, INC., HADJI MUHMINA J.
USMAN, JOHN ANTHONY L. LIM, JAMILON T. ODIN, ASRIN TIMBOL
JAIYARI, MUJIB M. KALANG, ALIH AL-SAIDI J. SAPI-E, KESSAR
DAMSIE ABDIL, AND BASSAM ALUH SAUPI, PETITIONERS, VS.
SENATE OF THE PHILIPPINES, REPRESENTED BY ITS PRESIDENT
JUAN PONCE ENRILE, HOUSE OF REPRESENTATIVES, THRU
SPEAKER FELICIANO BELMONTE, COMMISSION ON ELECTIONS,
THRU ITS CHAIRMAN, SIXTO BRILLANTES, JR., PAQUITO OCHOA, JR.,
OFFICE OF THE PRESIDENT EXECUTIVE SECRETARY, FLORENCIO
ABAD, JR., SECRETARY OF BUDGET, AND ROBERTO TAN,
TREASURER OF THE PHILIPPINES, RESPONDENTS.
[G.R. NO. 196305]
BASARI D. MAPUPUNO, PETITIONER, VS. SIXTO BRILLANTES, IN HIS
CAPACITY AS CHAIRMAN OF THE COMMISSION ON ELECTIONS,
FLORENCIO ABAD, JR. IN HIS CAPACITY AS SECRETARY OF THE
DEPARTMENT OF BUDGET AND MANAGEMENT, PACQUITO OCHOA,
JR., IN HIS CAPACITY AS EXECUTIVE SECRETARY, JUAN PONCE
ENRILE, IN HIS CAPACITY AS SENATE PRESIDENT, AND FELICIANO
BELMONTE, IN HIS CAPACITY AS SPEAKER OF THE HOUSE OF
REPRESENTATIVES, RESPONDENTS.
[G.R. NO. 197221]
REP. EDCEL C. LAGMAN, PETITIONER, VS. PAQUITO N. OCHOA, JR.,
IN HIS CAPACITY AS THE EXECUTIVE SECRETARY, AND THE
COMMISSION ON ELECTIONS, RESPONDENTS.

ATTY. ROMULO B. MACALINTAL, PETITIONER, VS. COMMISSION ON

ELECTIONS AND THE OFFICE OF THE PRESIDENT, THROUGH
EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR., RESPONDENTS.
LUIS "BAROK" BIRAOGO, PETITIONER, VS. THE COMMISSION ON
ELECTIONS AND EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR.,
RESPONDENTS.
[G.R. NO. 197392]
JACINTO V. PARAS, PETITIONER, VS. EXECUTIVE SECRETARY
PAQUITO N. OCHOA, JR., AND THE COMMISSION ON ELECTIONS,
RESPONDENTS.
[G.R. NO. 197454]
MINORITY RIGHTS FORUM, PHILIPPINES, INC., RESPONDENTSINTERVENOR.
DECISION
BRION, J.:
On June 30, 2011, Republic Act (RA) No. 10153, entitled "An Act Providing
for the Synchronization of the Elections in the Autonomous Region in Muslim
Mindanao (ARMM) with the National and Local Elections and for Other
Purposes" was enacted. The law reset the ARMM elections from the 8th of
August 2011, to the second Monday of May 2013 and every three (3) years
thereafter, to coincide with the country's regular national and local elections.
The law as well granted the President the power to "appoint officers-incharge (OICs) for the Office of the Regional Governor, the Regional ViceGovernor, and the Members of the Regional Legislative Assembly, who shall
perform the functions pertaining to the said offices until the officials duly
elected in the May 2013 elections shall have qualified and assumed office."

[G.R. NO. 197280]

ALMARIM CENTI TILLAH, DATU CASAN CONDING CANA, AND
PARTIDO DEMOKRATIKO PILIPINO LAKAS NG BAYAN (PDP-LABAN),
PETITIONERS, VS. THE COMMISSION ON ELECTIONS, THROUGH ITS
CHAIRMAN, SIXTO BRILLANTES, JR., HON. PAQUITO N. OCHOA, JR.,
IN HIS CAPACITY AS EXECUTIVE SECRETARY, HON. FLORENCIO B.
ABAD, JR., IN HIS CAPACITY AS SECRETARY OF THE DEPARTMENT
OF BUDGET AND MANAGEMENT, AND HON. ROBERTO B. TAN, IN HIS
CAPACITY AS TREASURER OF THE PHILIPPINES, RESPONDENTS.
[G.R. NO. 197282]

Even before its formal passage, the bills that became RA No. 10153 already
spawned petitions against their validity; House Bill No. 4146 and Senate Bill
No. 2756 were challenged in petitions filed with this Court. These petitions
multiplied after RA No. 10153 was passed.
Factual Antecedents
The State, through Sections 15 to 22, Article X of the 1987 Constitution,
mandated the creation of autonomous regions in Muslim Mindanao and the
Cordilleras. Section 15 states:

Section 15. There shall be created autonomous regions in Muslim Mindanao

and in the Cordilleras consisting of provinces, cities, municipalities, and
geographical areas sharing common and distinctive historical and cultural
heritage, economic and social structures, and other relevant characteristics
within the framework of this Constitution and the national sovereignty as well
as territorial integrity of the Republic of the Philippines.
Section 18 of the Article, on the other hand, directed Congress to enact an
organic act for these autonomous regions to concretely carry into effect the
granted autonomy.
Section 18. The Congress shall enact an organic act for each autonomous
region with the assistance and participation of the regional consultative
commission composed of representatives appointed by the President from a
list of nominees from multisectoral bodies. The organic act shall define the
basic structure of government for the region consisting of the executive
department and legislative assembly, both of which shall be elective and
representative of the constituent political units. The organic acts shall
likewise provide for special courts with personal, family and property law
jurisdiction consistent with the provisions of this Constitution and national
laws.
The creation of the autonomous region shall be effective when approved by a
majority of the votes cast by the constituent units in a plebiscite called for the
purpose, provided that only provinces, cities, and geographic areas voting
favorably in such plebiscite shall be included in the autonomous region.
On August 1, 1989 or two years after the effectivity of the 1987 Constitution,
Congress acted through Republic Act (RA) No. 6734 entitled "An Act
Providing for an Organic Act for the Autonomous Region in Muslim
Mindanao." A plebiscite was held on November 6, 1990 as required by
Section 18(2), Article X of RA No. 6734, thus fully establishing the
Autonomous Region of Muslim Mindanao (ARMM). The initially assenting
provinces were Lanao del Sur, Maguindanao, Sulu and Tawi-tawi. RA No.
6734 scheduled the first regular elections for the regional officials of the
ARMM on a date not earlier than 60 days nor later than 90 days after its
ratification.
RA No. 9054 (entitled "An Act to Strengthen and Expand the Organic Act for
the Autonomous Region in Muslim Mindanao, Amending for the Purpose
Republic Act No. 6734, entitled An Act Providing for the Autonomous Region
in Muslim Mindanao, as Amended") was the next legislative act passed. This
law provided further refinement in the basic ARMM structure first defined in
the original organic act, and reset the regular elections for the ARMM
regional officials to the second Monday of September 2001.

Congress passed the next law affecting ARMM - RA No. 9140[1] - on June
22, 2001. This law reset the first regular elections originally scheduled under
RA No. 9054, to November 26, 2001. It likewise set the plebiscite to ratify RA
No. 9054 to not later than August 15, 2001.
RA No. 9054 was ratified in a plebiscite held on August 14, 2001. The
province of Basilan and Marawi City voted to join ARMM on the same date.
RA No. 9333[2] was subsequently passed by Congress to reset the ARMM
regional elections to the 2nd Monday of August 2005, and on the same date
every 3 years thereafter. Unlike RA No. 6734 and RA No. 9054, RA No. 9333
was not ratified in a plebiscite.
Pursuant to RA No. 9333, the next ARMM regional elections should have
been held on August 8, 2011. COMELEC had begun preparations for these
elections and had accepted certificates of candidacies for the various
regional offices to be elected. But on June 30, 2011, RA No. 10153 was
enacted, resetting the ARMM elections to May 2013, to coincide with the
regular national and local elections of the country.
RA No. 10153 originated in the House of Representatives as House Bill (HB)
No. 4146, seeking the postponement of the ARMM elections scheduled on
August 8, 2011. On March 22, 2011, the House of Representatives passed
HB No. 4146, with one hundred ninety one (191) Members voting in its favor.
After the Senate received HB No. 4146, it adopted its own version, Senate
Bill No. 2756 (SB No. 2756), on June 6, 2011. Thirteen (13) Senators voted
favorably for its passage. On June 7, 2011, the House of Representative
concurred with the Senate amendments, and on June 30, 2011, the
President signed RA No. 10153 into law.
As mentioned, the early challenge to RA No. 10153 came through a petition
filed with this Court - G.R. No. 196271[3] - assailing the constitutionality of
both HB No. 4146 and SB No. 2756, and challenging the validity of RA No.
9333 as well for non-compliance with the constitutional plebiscite
requirement. Thereafter, petitioner Basari Mapupuno in G.R. No. 196305
filed another petition[4] also assailing the validity of RA No. 9333.
With the enactment into law of RA No. 10153, the COMELEC stopped its
preparations for the ARMM elections. The law gave rise as well to the filing
of the following petitions against its constitutionality:
a) Petition for Certiorari and Prohibition[5] filed by Rep. Edcel Lagman as a
member of the House of Representatives against Paquito Ochoa, Jr. (in his
capacity as the Executive Secretary) and the COMELEC, docketed as G.R.
No. 197221;

b) Petition for Mandamus and Prohibition[6] filed by Atty. Romulo Macalintal

as a taxpayer against the COMELEC, docketed as G.R. No. 197282;
c) Petition for Certiorari and Mandamus, Injunction and Preliminary
Injunction[7] filed by Louis "Barok" Biraogo against the COMELEC and
Executive Secretary Paquito N. Ochoa, Jr., docketed as G.R. No. 197392;
and
d) Petition for Certiorari and Mandamus[8] filed by Jacinto Paras as a
member of the House of Representatives against Executive Secretary
Paquito Ochoa, Jr. and the COMELEC, docketed as G.R. No. 197454.
Petitioners Alamarim Centi Tillah and Datu Casan Conding Cana as
registered voters from the ARMM, with the Partido Demokratiko Pilipino
Lakas ng Bayan (a political party with candidates in the ARMM regional
elections scheduled for August 8, 2011), also filed a Petition for Prohibition
and Mandamus[9] against the COMELEC, docketed as G.R. No. 197280, to
assail the constitutionality of RA No. 9140, RA No. 9333 and RA No. 10153.
Subsequently, Anak Mindanao Party-List, Minority Rights Forum Philippines,
Inc. and Bangsamoro Solidarity Movement filed their own Motion for Leave
to Admit their Motion for Intervention and Comment-in-Intervention dated July
18, 2011. On July 26, 2011, the Court granted the motion. In the same
Resolution, the Court ordered the consolidation of all the petitions relating to
the constitutionality of HB No. 4146, SB No. 2756, RA No. 9333, and RA No.
10153.
Oral arguments were held on August 9, 2011 and August 16, 2011.
Thereafter, the parties were instructed to submit their respective memoranda
within twenty (20) days.
On September 13, 2011, the Court issued a temporary restraining order
enjoining the implementation of RA No. 10153 and ordering the incumbent
elective officials of ARMM to continue to perform their functions should these
cases not be decided by the end of their term on September 30, 2011.

Section 26(2), Article VI of the Constitution. Also cited as grounds are the
alleged violations of the right of suffrage of the people of ARMM, as well as
the failure to adhere to the "elective and representative" character of the
executive and legislative departments of the ARMM. Lastly, the petitioners
challenged the grant to the President of the power to appoint OICs to
undertake the functions of the elective ARMM officials until the officials
elected under the May 2013 regular elections shall have assumed office.
Corrolarily, they also argue that the power of appointment also gave the
President the power of control over the ARMM, in complete violation of
Section 16, Article X of the Constitution.
The Issues
From the parties' submissions, the following issues were recognized and
argued by the parties in the oral arguments of August 9 and 16, 2011:
Whether the 1987 Constitution mandates the synchronization of elections
Whether the passage of RA No. 10153 violates Section 26(2), Article VI of
the 1987 Constitution
Whether the passage of RA No. 10153 requires a supermajority vote and
plebiscite
Does the postponement of the ARMM regular elections constitute an
amendment to Section 7, Article XVIII of RA No. 9054?
Does the requirement of a supermajority vote for amendments or revisions to
RA No. 9054 violate Section 1 and Section 16(2), Article VI of the 1987
Constitution and the corollary doctrine on irrepealable laws?
Does the requirement of a plebiscite apply only in the creation of
autonomous regions under paragraph 2, Section 18, Article X of the 1987
Constitution?
Whether RA No. 10153 violates the autonomy granted to the ARMM

The Arguments

Whether the grant of the power to appoint OICs violates:

The petitioners assailing RA No. 9140, RA No. 9333 and RA No. 10153
assert that these laws amend RA No. 9054 and thus, have to comply with the
supermajority vote and plebiscite requirements prescribed under Sections 1
and 3, Article XVII of RA No. 9094 in order to become effective.

Section 15, Article X of the 1987 Constitution

Section 16, Article X of the 1987 Constitution
Section 18, Article X of the 1987 Constitution
Whether the proposal to hold special elections is constitutional and legal.

The petitions assailing RA No. 10153 further maintain that it is

unconstitutional for its failure to comply with the three-reading requirement of

We shall discuss these issues in the order they are presented above.

OUR RULING

We resolve to DISMISS the petitions and thereby UPHOLD the

constitutionality of RA No. 10153 in toto.
I. Synchronization as a recognized constitutional mandate
The respondent Office of the Solicitor General (OSG) argues that the
Constitution mandates synchronization, and in support of this position, cites
Sections 1, 2 and 5, Article XVIII (Transitory Provisions) of the 1987
Constitution, which provides:
Section 1. The first elections of Members of the Congress under this
Constitution shall be held on the second Monday of May, 1987.
The first local elections shall be held on a date to be determined by the
President, which may be simultaneous with the election of the Members of
the Congress. It shall include the election of all Members of the city or
municipal councils in the Metropolitan Manila area.
Section 2. The Senators, Members of the House of Representatives and the
local officials first elected under this Constitution shall serve until noon of
June 30, 1992.
Of the Senators elected in the election in 1992, the first twelve obtaining the
highest number of votes shall serve for six year and the remaining twelve for
three years.

Commission, by deliberately making adjustments to the terms of the

incumbent officials, sought to attain synchronization of elections.[11]
The objective behind setting a common termination date for all elective
officials, done among others through the shortening the terms of the twelve
winning senators with the least number of votes, is to synchronize the
holding of all future elections - whether national or local - to once every three
years.[12] This intention finds full support in the discussions during the
Constitutional Commission deliberations.[13]
These Constitutional Commission exchanges, read with the provisions of the
Transitory Provisions of the Constitution, all serve as patent indicators of the
constitutional mandate to hold synchronized national and local elections,
starting the second Monday of May, 1992 and for all the following elections.
This Court was not left behind in recognizing the synchronization of the
national and local elections as a constitutional mandate. In Osmea v.
Commission on Elections,[14] we explained:
It is clear from the aforequoted provisions of the 1987 Constitution that the
terms of office of Senators, Members of the House of Representatives, the
local officials, the President and the Vice-President have been synchronized
to end on the same hour, date and year -- noon of June 30, 1992.
It is likewise evident from the wording of the above-mentioned Sections that
the term of synchronization is used synonymously as the phrase holding
simultaneously since this is the precise intent in terminating their Office
Tenure on the same day or occasion. This common termination date will
synchronize future elections to once every three years (Bernas, the
Constitution of the Republic of the Philippines, Vol. II, p. 605).

xxx
Section 5. The six-year term of the incumbent President and Vice President
elected in the February 7, 1986 election is, for purposes of synchronization of
elections, hereby extended to noon of June 30, 1992.
The first regular elections for President and Vice-President under this
Constitution shall be held on the second Monday of May, 1992.
We agree with this position.
While the Constitution does not expressly state that Congress has to
synchronize national and local elections, the clear intent towards this
objective can be gleaned from the Transitory Provisions (Article XVIII) of the
Constitution,[10] which show the extent to which the Constitutional

That the election for Senators, Members of the House of Representatives

and the local officials (under Sec. 2, Art. XVIII) will have to be synchronized
with the election for President and Vice President (under Sec. 5, Art. XVIII) is
likewise evident from the x x x records of the proceedings in the
Constitutional Commission. [Emphasis supplied.]
Although called regional elections, the ARMM elections should be included
among the elections to be synchronized as it is a "local" election based on
the wording and structure of the Constitution.
A basic rule in constitutional construction is that the words used should be
understood in the sense that they have in common use and given their
ordinary meaning, except when technical terms are employed, in which case
the significance thus attached to them prevails.[15] As this Court explained in
People v. Derilo,[16] "[a]s the Constitution is not primarily a lawyer's

document, its language should be understood in the sense that it may have
in common. Its words should be given their ordinary meaning except where
technical terms are employed."
Understood in its ordinary sense, the word "local" refers to something that
primarily serves the needs of a particular limited district, often a community
or minor political subdivision.[17] Regional elections in the ARMM for the
positions of governor, vice-governor and regional assembly representatives
obviously fall within this classification, since they pertain to the elected
officials who will serve within the limited region of ARMM.
From the perspective of the Constitution, autonomous regions are
considered one of the forms of local governments, as evident from Article X
of the Constitution entitled "Local Government." Autonomous regions are
established and discussed under Sections 15 to 21 of this Article - the article
wholly devoted to Local Government. That an autonomous region is
considered a form of local government is also reflected in Section 1, Article X
of the Constitution, which provides:
Section 1. The territorial and political subdivisions of the Republic of the
Philippines are the provinces, cities, municipalities, and barangays. There
shall be autonomous regions in Muslim Mindanao, and the Cordilleras as
hereinafter provided.
Thus, we find the contention - that the synchronization mandated by the
Constitution does not include the regional elections of the ARMM unmeritorious. We shall refer to synchronization in the course of our
discussions below, as this concept permeates the consideration of the
various issues posed in this case and must be recalled time and again for its
complete resolution.
II. The President's Certification on the Urgency of RA No. 10153
The petitioners in G.R. No. 197280 also challenge the validity of RA No.
10153 for its alleged failure to comply with Section 26(2), Article VI of the
Constitution[18] which provides that before bills passed by either the House
or the Senate can become laws, they must pass through three readings on
separate days. The exception is when the President certifies to the necessity
of the bill's immediate enactment.
The Court, in Tolentino v. Secretary of Finance,[19] explained the effect of
the President's certification of necessity in the following manner:
The presidential certification dispensed with the requirement not only of
printing but also that of reading the bill on separate days. The phrase "except
when the President certifies to the necessity of its immediate enactment,

etc." in Art. VI, Section 26[2] qualifies the two stated conditions before a bill
can become a law: [i] the bill has passed three readings on separate days
and [ii] it has been printed in its final form and distributed three days before it
is finally approved.
xxx
That upon the certification of a bill by the President, the requirement of three
readings on separate days and of printing and distribution can be dispensed
with is supported by the weight of legislative practice. For example, the bill
defining the certiorari jurisdiction of this Court which, in consolidation with the
Senate version, became Republic Act No. 5440, was passed on second and
third readings in the House of Representatives on the same day [May 14,
1968] after the bill had been certified by the President as urgent.
In the present case, the records show that the President wrote to the
Speaker of the House of Representatives to certify the necessity of the
immediate enactment of a law synchronizing the ARMM elections with the
national and local elections.[20]
Following our Tolentino ruling, the
President's certification exempted both the House and the Senate from
having to comply with the three separate readings requirement.
On the follow-up contention that no necessity existed for the immediate
enactment of these bills since there was no public calamity or emergency
that had to be met, again we hark back to our ruling in Tolentino:
The sufficiency of the factual basis of the suspension of the writ of habeas
corpus or declaration of martial law Art. VII, Section 18, or the existence of a
national emergency justifying the delegation of extraordinary powers to the
President under Art. VI, Section 23(2) is subject to judicial review because
basic rights of individuals may be of hazard. But the factual basis of
presidential certification of bills, which involves doing away with procedural
requirements designed to insure that bills are duly considered by members of
Congress, certainly should elicit a different standard of review. [Emphasis
supplied.]
The House of Representatives and the Senate - in the exercise of their
legislative discretion - gave full recognition to the President's certification and
promptly enacted RA No. 10153. Under the circumstances, nothing short of
grave abuse of discretion on the part of the two houses of Congress can
justify our intrusion under our power of judicial review.[21]
The petitioners, however, failed to provide us with any cause or justification
for this course of action. Hence, while the judicial department and this Court
are not bound by the acceptance of the President's certification by both the
House of Representatives and the Senate, prudent exercise of our powers

and respect due our co-equal branches of government in matters committed

to them by the Constitution, caution a stay of the judicial hand.[22]
In any case, despite the President's certification, the two-fold purpose that
underlies the requirement for three readings on separate days of every bill
must always be observed to enable our legislators and other parties
interested in pending bills to intelligently respond to them. Specifically, the
purpose with respect to Members of Congress is: (1) to inform the legislators
of the matters they shall vote on and (2) to give them notice that a measure
is in progress through the enactment process.[23]
We find, based on the records of the deliberations on the law, that both
advocates and the opponents of the proposed measure had sufficient
opportunities to present their views. In this light, no reason exists to nullify
RA No. 10153 on the cited ground.
III. A. RA No. 9333 and RA No. 10153 are not amendments to RA No. 9054
The effectivity of RA No. 9333 and RA No. 10153 has also been challenged
because they did not comply with Sections 1 and 3, Article XVII of RA No.
9054 in amending this law. These provisions require:
Section 1. Consistent with the provisions of the Constitution, this Organic Act
may be reamended or revised by the Congress of the Philippines upon a
vote of two-thirds (2/3) of the Members of the House of Representatives and
of the Senate voting separately.
Section 3. Any amendment to or revision of this Organic Act shall become
effective only when approved by a majority of the vote cast in a plebiscite
called for the purpose, which shall be held not earlier than sixty (60) days or
later than ninety (90) days after the approval of such amendment or revision.

This view - that Congress thought it best to leave the determination of the
date of succeeding ARMM elections to legislative discretion - finds support in
ARMM's recent history.
To recall, RA No. 10153 is not the first law passed that rescheduled the
ARMM elections. The First Organic Act - RA No. 6734 - not only did not fix
the date of the subsequent elections; it did not even fix the specific date of
the first ARMM elections,[24] leaving the date to be fixed in another
legislative enactment. Consequently, RA No. 7647,[25] RA No. 8176,[26] RA
No. 8746,[27] RA No. 8753,[28] and RA No. 9012[29] were all enacted by
Congress to fix the dates of the ARMM elections. Since these laws did not
change or modify any part or provision of RA No. 6734, they were not
amendments to this latter law. Consequently, there was no need to submit
them to any plebiscite for ratification.
The Second Organic Act - RA No. 9054 - which lapsed into law on March 31,
2001, provided that the first elections would be held on the second Monday
of September 2001. Thereafter, Congress passed RA No. 9140[30] to reset
the date of the ARMM elections. Significantly, while RA No. 9140 also
scheduled the plebiscite for the ratification of the Second Organic Act (RA
No. 9054), the new date of the ARMM regional elections fixed in RA No.
9140 was not among the provisions ratified in the plebiscite held to approve
RA No. 9054. Thereafter, Congress passed RA No. 9333,[31] which further
reset the date of the ARMM regional elections. Again, this law was not
ratified through a plebiscite.
From these legislative actions, we see the clear intention of Congress to treat
the laws which fix the date of the subsequent ARMM elections as separate
and distinct from the Organic Acts. Congress only acted consistently with this
intent when it passed RA No. 10153 without requiring compliance with the
amendment prerequisites embodied in Section 1 and Section 3, Article XVII
of RA No. 9054.

We find no merit in this contention.

In the first place, neither RA No. 9333 nor RA No. 10153 amends RA No.
9054. As an examination of these laws will show, RA No. 9054 only provides
for the schedule of the first ARMM elections and does not fix the date of the
regular elections. A need therefore existed for the Congress to fix the date of
the subsequent ARMM regular elections, which it did by enacting RA No.
9333 and thereafter, RA No. 10153. Obviously, these subsequent laws - RA
No. 9333 and RA No. 10153 - cannot be considered amendments to RA No.
9054 as they did not change or revise any provision in the latter law; they
merely filled in a gap in RA No. 9054 or supplemented the law by providing
the date of the subsequent regular elections.

III. B. Supermajority voting requirement unconstitutional

for giving RA No. 9054 the character of an irrepealable law
Even assuming that RA No. 9333 and RA No. 10153 did in fact amend RA
No. 9054, the supermajority (2/3) voting requirement required under Section
1, Article XVII of RA No. 9054[32] has to be struck down for giving RA No.
9054 the character of an irrepealable law by requiring more than what the
Constitution demands.
Section 16(2), Article VI of the Constitution provides that a "majority of each
House shall constitute a quorum to do business." In other words, as long as
majority of the members of the House of Representatives or the Senate are
present, these bodies have the quorum needed to conduct business and hold

session. Within a quorum, a vote of majority is generally sufficient to enact

laws or approve acts.
In contrast, Section 1, Article XVII of RA No. 9054 requires a vote of no less
than two-thirds (2/3) of the Members of the House of Representatives and of
the Senate, voting separately, in order to effectively amend RA No. 9054.
Clearly, this 2/3 voting requirement is higher than what the Constitution
requires for the passage of bills, and served to restrain the plenary powers of
Congress to amend, revise or repeal the laws it had passed. The Court's
pronouncement in City of Davao v. GSIS[33] on this subject best explains the
basis and reason for the unconstitutionality:
Moreover, it would be noxious anathema to democratic principles for a
legislative body to have the ability to bind the actions of future legislative
body, considering that both assemblies are regarded with equal footing,
exercising as they do the same plenary powers. Perpetual infallibility is not
one of the attributes desired in a legislative body, and a legislature which
attempts to forestall future amendments or repeals of its enactments labors
under delusions of omniscience.
xxx
A state legislature has a plenary law-making power over all subjects, whether
pertaining to persons or things, within its territorial jurisdiction, either to
introduce new laws or repeal the old, unless prohibited expressly or by
implication by the federal constitution or limited or restrained by its own. It
cannot bind itself or its successors by enacting irrepealable laws except
when so restrained. Every legislative body may modify or abolish the acts
passed by itself or its predecessors. This power of repeal may be exercised
at the same session at which the original act was passed; and even while a
bill is in its progress and before it becomes a law. This legislature cannot
bind a future legislature to a particular mode of repeal. It cannot declare in
advance the intent of subsequent legislatures or the effect of subsequent
legislation upon existing statutes.[34] (Emphasis ours.)
Thus, while a supermajority is not a total ban against a repeal, it is a
limitation in excess of what the Constitution requires on the passage of bills
and is constitutionally obnoxious because it significantly constricts the future
legislators' room for action and flexibility.
III. C. Section 3, Article XVII of RA No. 9054 excessively enlarged
the plebiscite requirement found in Section 18, Article X of the Constitution
The requirements of RA No. 9054 not only required an unwarranted
supermajority, but enlarged as well the plebiscite requirement, as embodied
in its Section 3, Article XVII of that Act. As we did on the supermajority

requirement, we find the enlargement of the plebiscite requirement required

under Section 18, Article X of the Constitution to be excessive to point of
absurdity and, hence, a violation of the Constitution.
Section 18, Article X of the Constitution states that the plebiscite is required
only for the creation of autonomous regions and for determining which
provinces, cities and geographic areas will be included in the autonomous
regions. While the settled rule is that amendments to the Organic Act have to
comply with the plebiscite requirement in order to become effective,[35]
questions on the extent of the matters requiring ratification may unavoidably
arise because of the seemingly general terms of the Constitution and the
obvious absurdity that would result if a plebiscite were to be required for
every statutory amendment.
Section 18, Article X of the Constitution plainly states that "The creation of
the autonomous region shall be effective when approved by the majority of
the votes case by the constituent units in a plebiscite called for the purpose."
With these wordings as standard, we interpret the requirement to mean that
only amendments to, or revisions of, the Organic Act constitutionallyessential to the creation of autonomous regions - i.e., those aspects
specifically mentioned in the Constitution which Congress must provide for in
the Organic Act - require ratification through a plebiscite.
These
amendments to the Organic Act are those that relate to: (a) the basic
structure of the regional government; (b) the region's judicial system, i.e., the
special courts with personal, family, and property law jurisdiction; and, (c)
the grant and extent of the legislative powers constitutionally conceded to the
regional government under Section 20, Article X of the Constitution.[36]
The date of the ARMM elections does not fall under any of the matters that
the Constitution specifically mandated Congress to provide for in the Organic
Act. Therefore, even assuming that the supermajority votes and the
plebiscite requirements are valid, any change in the date of elections cannot
be construed as a substantial amendment of the Organic Act that would
require compliance with these requirements.
IV. The synchronization issue
As we discussed above, synchronization of national and local elections is a
constitutional mandate that Congress must provide for and this
synchronization must include the ARMM elections. On this point, an existing
law in fact already exists - RA No. 7166 - as the forerunner of the current RA
No. 10153. RA No. 7166 already provides for the synchronization of local
elections with the national and congressional elections. Thus, what RA No.
10153 provides is an old matter for local governments (with the exception of
barangay and Sanggunian Kabataan elections where the terms are not
constitutionally provided) and is technically a reiteration of what is already

reflected in the law, given that regional elections are in reality local elections
by express constitutional recognition.[37]
To achieve synchronization, Congress necessarily has to reconcile the
schedule of the ARMM's regular elections (which should have been held in
August 2011 based on RA No. 9333) with the fixed schedule of the national
and local elections (fixed by RA No. 7166 to be held in May 2013).
During the oral arguments, the Court identified the three options open to
Congress in order to resolve this problem. These options are: (1) to allow the
elective officials in the ARMM to remain in office in a hold over capacity,
pursuant to Section 7(1), Article VII of RA No. 9054, until those elected in the
synchronized elections assume office;[38] (2) to hold special elections in the
ARMM, with the terms of those elected to expire when those elected in the
synchronized elections assume office; or (3) to authorize the President to
appoint OICs, pursuant to Section 3 of RA No. 10153, also until those
elected in the synchronized elections assume office.
As will be abundantly clear in the discussion below, Congress, in choosing to
grant the President the power to appoint OICs, chose the correct option and
passed RA No. 10153 as a completely valid law.
V. The Constitutionality of RA No. 10153
A. Basic Underlying Premises
To fully appreciate the available options, certain underlying material premises
must be fully understood. The first is the extent of the powers of Congress to
legislate; the second is the constitutional mandate for the synchronization of
elections; and the third is on the concept of autonomy as recognized and
established under the 1987 Constitution.

autonomy provisions of Article X) provide their own express limitations. The

implied limitations are found "in the evident purpose which was in view and
the circumstances and historical events which led to the enactment of the
particular provision as a part of organic law."[43]
The constitutional provisions on autonomy - specifically, Sections 15 to 21 of
Article X of the Constitution - constitute express limitations on legislative
power as they define autonomy, its requirements and its parameters, thus
limiting what is otherwise the unlimited power of Congress to legislate on the
governance of the autonomous region.
Of particular relevance to the issues of the present case are the limitations
posed by the prescribed basic structure of government - i.e., that the
government must have an executive department and a legislative assembly,
both of which must be elective and representative of the constituent political
units; national government, too, must not encroach on the legislative powers
granted under Section 20, Article X. Conversely and as expressly reflected in
Section 17, Article X, "all powers and functions not granted by this
Constitution or by law to the autonomous regions shall be vested in the
National Government."
The totality of Sections 15 to 21 of Article X should likewise serve as a
standard that Congress must observe in dealing with legislation touching on
the affairs of the autonomous regions. The terms of these sections leave no
doubt on what the Constitution intends - the idea of self-rule or selfgovernment, in particular, the power to legislate on a wide array of social,
economic and administrative matters. But equally clear under these
provisions are the permeating principles of national sovereignty and the
territorial integrity of the Republic, as expressed in the above-quoted Section
17 and in Section 15.[44] In other words, the Constitution and the supporting
jurisprudence, as they now stand, reject the notion of imperium et imperio[45]
in the relationship between the national and the regional governments.

The grant of legislative power to Congress is broad, general and

comprehensive.[39] The legislative body possesses plenary power for all
purposes of civil government.[40] Any power, deemed to be legislative by
usage and tradition, is necessarily possessed by Congress, unless the
Constitution has lodged it elsewhere.[41]
Except as limited by the
Constitution, either expressly or impliedly, legislative power embraces all
subjects and extends to all matters of general concern or common
interest.[42]

In relation with synchronization, both autonomy and the synchronization of

national and local elections are recognized and established constitutional
mandates, with one being as compelling as the other. If their compelling
force differs at all, the difference is in their coverage; synchronization
operates on and affects the whole country, while regional autonomy - as the
term suggests - directly carries a narrower regional effect although its
national effect cannot be discounted.

The constitutional limitations on legislative power are either express or

implied. The express limitations are generally provided in some provisions of
the Declaration of Principles and State Policies (Article 2) and in the
provisions Bill of Rights (Article 3). Other constitutional provisions (such as
the initiative and referendum clause of Article 6, Sections 1 and 32, and the

These underlying basic concepts characterize the powers and limitations of

Congress when it acted on RA No. 10153. To succinctly describe the legal
situation that faced Congress then, its decision to synchronize the regional
elections with the national, congressional and all other local elections (save
for barangay and sangguniang kabataan elections) left it with the problem of

how to provide the ARMM with governance in the intervening period between
the expiration of the term of those elected in August 2008 and the
assumption to office - twenty-one (21) months away - of those who will win in
the synchronized elections on May 13, 2013.
The problem, in other words, was for interim measures for this period,
consistent with the terms of the Constitution and its established supporting
jurisprudence, and with the respect due to the concept of autonomy. Interim
measures, to be sure, is not a strange phenomenon in the Philippine legal
landscape. The Constitution's Transitory Provisions themselves collectively
provide measures for transition from the old constitution to the new[46] and
for the introduction of new concepts.[47] As previously mentioned, the
adjustment of elective terms and of elections towards the goal of
synchronization first transpired under the Transitory Provisions. The
adjustments, however, failed to look far enough or deeply enough,
particularly into the problems that synchronizing regional autonomous
elections would entail; thus, the present problem is with us today.
The creation of local government units also represents instances when
interim measures are required. In the creation of Quezon del Sur[48] and
Dinagat Islands,[49] the creating statutes authorized the President to appoint
an interim governor, vice-governor and members of the sangguniang
panlalawigan although these positions are essentially elective in character;
the appointive officials were to serve until a new set of provincial officials
shall have been elected and qualified.[50] A similar authority to appoint is
provided in the transition of a local government from a sub-province to a
province.[51]
In all these, the need for interim measures is dictated by necessity; out-ofthe-way arrangements and approaches were adopted or used in order to
adjust to the goal or objective in sight in a manner that does not do violence
to the Constitution and to reasonably accepted norms. Under these
limitations, the choice of measures was a question of wisdom left to
congressional discretion.
To return to the underlying basic concepts, these concepts shall serve as the
guideposts and markers in our discussion of the options available to
Congress to address the problems brought about by the synchronization of
the ARMM elections, properly understood as interim measures that Congress
had to provide. The proper understanding of the options as interim
measures assume prime materiality as it is under these terms that the
passage of RA No. 10153 should be measured, i.e., given the constitutional
objective of synchronization that cannot legally be faulted, did Congress
gravely abuse its discretion or violate the Constitution when it addressed
through RA No. 10153 the concomitant problems that the adjustment of
elections necessarily brought with it?

B. Holdover Option is Unconstitutional

We rule out the first option - holdover for those who were elected in executive
and legislative positions in the ARMM during the 2008-2011 term - as an
option that Congress could have chosen because a holdover violates Section
8, Article X of the Constitution. This provision states:
Section 8. The term of office of elective local officials, except barangay
officials, which shall be determined by law, shall be three years and no such
official shall serve for more than three consecutive terms. [emphases ours]
Since elective ARMM officials are local officials, they are covered and bound
by the three-year term limit prescribed by the Constitution; they cannot
extend their term through a holdover. As this Court put in Osmea v.
COMELEC:[52]
It is not competent for the legislature to extend the term of officers by
providing that they shall hold over until their successors are elected and
qualified where the constitution has in effect or by clear implication
prescribed the term and when the Constitution fixes the day on which the
official term shall begin, there is no legislative authority to continue the office
beyond that period, even though the successors fail to qualify within the time.
In American Jurisprudence it has been stated as follows:
"It has been broadly stated that the legislature cannot, by an act postponing
the election to fill an office the term of which is limited by the Constitution,
extend the term of the incumbent beyond the period as limited by the
Constitution." [Emphasis ours.]
Independently of the Osmea ruling, the primacy of the Constitution as the
supreme law of the land dictates that where the Constitution has itself made
a determination or given its mandate, then the matters so determined or
mandated should be respected until the Constitution itself is changed by
amendment or repeal through the applicable constitutional process. A
necessary corollary is that none of the three branches of government can
deviate from the constitutional mandate except only as the Constitution itself
may allow.[53] If at all, Congress may only pass legislation filing in details to
fully operationalize the constitutional command or to implement it by
legislation if it is non-self-executing; this Court, on the other hand, may only
interpret the mandate if an interpretation is appropriate and called for.[54]
In the case of the terms of local officials, their term has been fixed clearly and
unequivocally, allowing no room for any implementing legislation with respect
to the fixed term itself and no vagueness that would allow an interpretation

from this Court. Thus, the term of three years for local officials should stay at
three (3) years as fixed by the Constitution and cannot be extended by
holdover by Congress.

justice or expediency of legislation,[62] except where an attendant

unconstitutionality or grave abuse of discretion results.
C. The COMELEC has no authority to order special elections

If it will be claimed that the holdover period is effectively another term

mandated by Congress, the net result is for Congress to create a new term
and to appoint the occupant for the new term. This view - like the extension
of the elective term - is constitutionally infirm because Congress cannot do
indirectly what it cannot do directly, i.e., to act in a way that would effectively
extend the term of the incumbents. Indeed, if acts that cannot be legally done
directly can be done indirectly, then all laws would be illusory.[55] Congress
cannot also create a new term and effectively appoint the occupant of the
position for the new term. This is effectively an act of appointment by
Congress and an unconstitutional intrusion into the constitutional
appointment power of the President.[56] Hence, holdover - whichever way it
is viewed - is a constitutionally infirm option that Congress could not have
undertaken.
Jurisprudence, of course, is not without examples of cases where the
question of holdover was brought before, and given the imprimatur of
approval by, this Court. The present case though differs significantly from
past cases with contrary rulings, particularly from Sambarani v.
COMELEC,[57] Adap v. Comelec,[58] and Montesclaros v. Comelec,[59]
where the Court ruled that the elective officials could hold on to their
positions in a hold over capacity.
All these past cases refer to elective barangay or sangguniang kabataan
officials whose terms of office are not explicitly provided for in the
Constitution; the present case, on the other hand, refers to local elective
officials - the ARMM Governor, the ARMM Vice-Governor, and the members
of the Regional Legislative Assembly - whose terms fall within the three-year
term limit set by Section 8, Article X of the Constitution. Because of their
constitutionally limited term, Congress cannot legislate an extension beyond
the term for which they were originally elected.
Even assuming that holdover is constitutionally permissible, and there had
been statutory basis for it (namely Section 7, Article VII of RA No. 9054) in
the past,[60] we have to remember that the rule of holdover can only apply
as an available option where no express or implied legislative intent to the
contrary exists; it cannot apply where such contrary intent is evident.[61]
Congress, in passing RA No. 10153, made it explicitly clear that it had the
intention of suppressing the holdover rule that prevailed under RA No. 9054
by completely removing this provision. The deletion is a policy decision that
is wholly within the discretion of Congress to make in the exercise of its
plenary legislative powers; this Court cannot pass upon questions of wisdom,

Another option proposed by the petitioner in G.R. No. 197282 is for this Court
to compel COMELEC to immediately conduct special elections pursuant to
Section 5 and 6 of Batas Pambansa Bilang (BP) 881.
The power to fix the date of elections is essentially legislative in nature, as
evident from, and exemplified by, the following provisions of the Constitution:
Section 8, Article VI, applicable to the legislature, provides:
Section 8. Unless otherwise provided by law, the regular election of the
Senators and the Members of the House of Representatives shall be held on
the second Monday of May. [Emphasis ours]
Section 4(3), Article VII, with the same tenor but applicable solely to the
President and Vice-President, states:
xxxx
Section 4. xxx Unless otherwise provided by law, the regular election for
President and Vice-President shall be held on the second Monday of May.
[Emphasis ours]
while Section 3, Article X, on local government, provides:
Section 3. The Congress shall enact a local government code which shall
provide for xxx the qualifications, election, appointment and removal, term,
salaries, powers and functions and duties of local officials[.] [Emphases ours]
These provisions support the conclusion that no elections may be held on
any other date for the positions of President, Vice President, Members of
Congress and local officials, except when so provided by another Act of
Congress, or upon orders of a body or officer to whom Congress may have
delegated either the power or the authority to ascertain or fill in the details in
the execution of that power.[63]
Notably, Congress has acted on the ARMM elections by postponing the
scheduled August 2011 elections and setting another date - May 13, 2011 for regional elections synchronized with the presidential, congressional and
other local elections. By so doing, Congress itself has made a policy
decision in the exercise of its legislative wisdom that it shall not call special

elections as an adjustment measure in synchronizing the ARMM elections

with the other elections.
After Congress has so acted, neither the Executive nor the Judiciary can act
to the contrary by ordering special elections instead at the call of the
COMELEC. This Court, particularly, cannot make this call without thereby
supplanting the legislative decision and effectively legislating. To be sure,
the Court is not without the power to declare an act of Congress null and void
for being unconstitutional or for having been exercised in grave abuse of
discretion.[64] But our power rests on very narrow ground and is merely to
annul a contravening act of Congress; it is not to supplant the decision of
Congress nor to mandate what Congress itself should have done in the
exercise of its legislative powers. Thus, contrary to what the petition in G.R.
No. 197282 urges, we cannot compel COMELEC to call for special elections.
Furthermore, we have to bear in mind that the constitutional power of the
COMELEC, in contrast with the power of Congress to call for, and to set the
date of, elections, is limited to enforcing and administering all laws and
regulations relative to the conduct of an election.[65] Statutorily, COMELEC
has no power to call for the holding of special elections unless pursuant to a
specific statutory grant. True, Congress did grant, via Sections 5 and 6 of BP
881, COMELEC with the power to postpone elections to another date.
However, this power is limited to, and can only be exercised within, the
specific terms and circumstances provided for in the law. We quote:
Section 5. Postponement of election. - When for any serious cause such as
violence, terrorism, loss or destruction of election paraphernalia or records,
force majeure, and other analogous causes of such a nature that the holding
of a free, orderly and honest election should become impossible in any
political subdivision, the Commission, motu proprio or upon a verified petition
by any interested party, and after due notice and hearing, whereby all
interested parties are afforded equal opportunity to be heard, shall postpone
the election therein to a date which should be reasonably close to the date of
the election not held, suspended or which resulted in a failure to elect but not
later than thirty days after the cessation of the cause for such postponement
or suspension of the election or failure to elect.
Section 6. Failure of election. - If, on account of force majeure, violence,
terrorism, fraud, or other analogous causes the election in any polling place
has not been held on the date fixed, or had been suspended before the hour
fixed by law for the closing of the voting, or after the voting and during the
preparation and the transmission of the election returns or in the custody or
canvass thereof, such election results in a failure to elect, and in any of such
cases the failure or suspension of election would affect the result of the
election, the Commission shall, on the basis of a verified petition by any
interested party and after due notice and hearing, call for the holding or

continuation of the election not held, suspended or which resulted in a failure

to elect on a date reasonably close to the date of the election not held,
suspended or which resulted in a failure to elect but not later than thirty days
after the cessation of the cause of such postponement or suspension of the
election or failure to elect. [Emphasis ours]
A close reading of Section 5 of BP 881 reveals that it is meant to address
instances where elections have already been scheduled to take place but
have to be postponed because of (a) violence, (b) terrorism, (c) loss or
destruction of election paraphernalia or records, (d) force majeure, and (e)
other analogous causes of such a nature that the holding of a free, orderly
and honest election should become impossible in any political subdivision.
Under the principle of ejusdem generis, the term "analogous causes" will be
restricted to those unforeseen or unexpected events that prevent the holding
of the scheduled elections. These "analogous causes" are further defined by
the phrase "of such nature that the holding of a free, orderly and honest
election should become impossible."
Similarly, Section 6 of BP 881 applies only to those situations where
elections have already been scheduled but do not take place because of (a)
force majeure, (b) violence, (c) terrorism, (d) fraud, or (e) other analogous
causes the election in any polling place has not been held on the date fixed,
or had been suspended before the hour fixed by law for the closing of the
voting, or after the voting and during the preparation and the transmission of
the election returns or in the custody or canvass thereof, such election
results in a failure to elect. As in Section 5 of BP 881, Section 6 addresses
instances where the elections do not occur or had to be suspended because
of unexpected and unforeseen circumstances.
In the present case, the postponement of the ARMM elections is by law - i.e.,
by congressional policy - and is pursuant to the constitutional mandate of
synchronization of national and local elections. By no stretch of the
imagination can these reasons be given the same character as the
circumstances contemplated by Section 5 or Section 6 of BP 881, which all
pertain to extralegal causes that obstruct the holding of elections. Courts, to
be sure, cannot enlarge the scope of a statute under the guise of
interpretation, nor include situations not provided nor intended by the
lawmakers.[66] Clearly, neither Section 5 nor Section 6 of BP 881 can apply
to the present case and this Court has absolutely no legal basis to compel
the COMELEC to hold special elections.
D. The Court has no power to shorten
the terms of elective officials
Even assuming that it is legally permissible for the Court to compel the
COMELEC to hold special elections, no legal basis likewise exists to rule that

the newly elected ARMM officials shall hold office only until the ARMM
officials elected in the synchronized elections shall have assumed office.

be recognized.[73] The appointing power is embodied in Section 16, Article

VII of the Constitution, which states:

In the first place, the Court is not empowered to adjust the terms of elective
officials. Based on the Constitution, the power to fix the term of office of
elective officials, which can be exercised only in the case of barangay
officials,[67] is specifically given to Congress. Even Congress itself may be
denied such power, as shown when the Constitution shortened the terms of
twelve Senators obtaining the least votes,[68] and extended the terms of the
President and the Vice-President[69] in order to synchronize elections;
Congress was not granted this same power. The settled rule is that terms
fixed by the Constitution cannot be changed by mere statute.[70] More
particularly, not even Congress and certainly not this Court, has the authority
to fix the terms of elective local officials in the ARMM for less, or more, than
the constitutionally mandated three years[71] as this tinkering would directly
contravene Section 8, Article X of the Constitution as we ruled in Osmena.

Section 16. The President shall nominate and, with the consent of the
Commission on Appointments, appoint the heads of the executive
departments, ambassadors, other public ministers and consuls or officers of
the armed forces from the rank of colonel or naval captain, and other officers
whose appointments are vested in him in this Constitution. He shall also
appoint all other officers of the Government whose appointments are not
otherwise provided for by law, and those whom he may be authorized by law
to appoint. The Congress may, by law, vest the appointment of other officers
lower in rank in the President alone, in the courts, or in the heads of
departments, agencies, commissions, or boards. [emphasis ours]

Thus, in the same way that the term of elective ARMM officials cannot be
extended through a holdover, the term cannot be shortened by putting an
expiration date earlier than the three (3) years that the Constitution itself
commands. This is what will happen - a term of less than two years - if a call
for special elections shall prevail. In sum, while synchronization is achieved,
the result is at the cost of a violation of an express provision of the
Constitution.

First, the heads of the executive departments; ambassadors; other public

ministers and consuls; officers of the Armed Forces of the Philippines, from
the rank of colonel or naval captain; and other officers whose appointments
are vested in the President in this Constitution;

Neither we nor Congress can opt to shorten the tenure of those officials to be
elected in the ARMM elections instead of acting on their term (where the
"term" means the time during which the officer may claim to hold office as of
right and fixes the interval after which the several incumbents shall succeed
one another, while the "tenure" representsthe term during which the
incumbent actually holds the office).[72] As with the fixing of the elective
term, neither Congress nor the Court has any legal basis to shorten the
tenure of elective ARMM officials. They would commit an unconstitutional act
and gravely abuse their discretion if they do so.

Third, those whom the President may be authorized by law to appoint; and

E. The President's Power to Appoint OICs

If at all, the gravest challenge posed by the petitions to the authority to

appoint OICs under Section 3 of RA No. 10153 is the assertion that the
Constitution requires that the ARMM executive and legislative officials to be
"elective and representative of the constituent political units." This
requirement indeed is an express limitation whose non-observance in the
assailed law leaves the appointment of OICs constitutionally defective.

The above considerations leave only Congress' chosen interim measure RA No. 10153 and the appointment by the President of OICs to govern the
ARMM during the pre-synchronization period pursuant to Sections 3, 4 and 5
of this law - as the only measure that Congress can make. This choice itself,
however, should be examined for any attendant constitutional infirmity.
At the outset, the power to appoint is essentially executive in nature, and the
limitations on or qualifications to the exercise of this power should be strictly
construed; these limitations or qualifications must be clearly stated in order to

This provision classifies into four groups the officers that the President can
appoint. These are:

Second, all other officers of the government whose appointments are not
otherwise provided for by law;

Fourth, officers lower in rank whose appointments the Congress may by law
vest in the President alone.[74]
Since the President's authority to appoint OICs emanates from RA No.
10153, it falls under the third group of officials that the President can appoint
pursuant to Section 16, Article VII of the Constitution. Thus, the assailed law
facially rests on clear constitutional basis.

After fully examining the issue, we hold that this alleged constitutional
problem is more apparent than real and becomes very real only if RA No.
10153 were to be mistakenly read as a law that changes the elective and
representative character of ARMM positions. RA No. 10153, however, does

not in any way amend what the organic law of the ARMM (RA No. 9054)
sets outs in terms of structure of governance. What RA No. 10153 in fact
only does is to "appoint officers-in-charge for the Office of the Regional
Governor, Regional Vice Governor and Members of the Regional Legislative
Assembly who shall perform the functions pertaining to the said offices until
the officials duly elected in the May 2013 elections shall have qualified and
assumed office." This power is far different from appointing elective ARMM
officials for the abbreviated term ending on the assumption to office of the
officials elected in the May 2013 elections.
As we have already established in our discussion of the supermajority and
plebiscite requirements, the legal reality is that RA No. 10153 did not amend
RA No. 9054. RA No. 10153, in fact, provides only for synchronization of
elections and for the interim measures that must in the meanwhile prevail.
And this is how RA No. 10153 should be read - in the manner it was written
and based on its unambiguous facial terms.[75] Aside from its order for
synchronization, it is purely and simply an interim measure responding to the
adjustments that the synchronization requires.
Thus, the appropriate question to ask is whether the interim measure is an
unreasonable move for Congress to adopt, given the legal situation that the
synchronization unavoidably brought with it. In more concrete terms and
based on the above considerations, given the plain unconstitutionality of
providing for a holdover and the unavailability of constitutional possibilities for
lengthening or shortening the term of the elected ARMM officials, is the
choice of the President's power to appoint - for a fixed and specific period as
an interim measure, and as allowed under Section 16, Article VII of the
Constitution - an unconstitutional or unreasonable choice for Congress to
make?
Admittedly, the grant of the power to the President under other situations or
where the power of appointment would extend beyond the adjustment period
for synchronization would be to foster a government that is not "democratic
and republican." For then, the people's right to choose the leaders to govern
them may be said to be systemically withdrawn to the point of fostering an
undemocratic regime. This is the grant that would frontally breach the
"elective and representative" governance requirement of Section 18, Article X
of the Constitution.
But this conclusion would not be true under the very limited circumstances
contemplated in RA No. 10153 where the period is fixed and, more
importantly, the terms of governance - both under Section 18, Article X of the
Constitution and RA No. 9054 - will not systemically be touched nor affected
at all. To repeat what has previously been said, RA No. 9054 will govern
unchanged and continuously, with full effect in accordance with the

Constitution, save only for the interim and temporary measures that
synchronization of elections requires.
Viewed from another perspective, synchronization will temporarily disrupt the
election process in a local community, the ARMM, as well as the
community's choice of leaders, but this will take place under a situation of
necessity and as an interim measure in the manner that interim measures
have been adopted and used in the creation of local government units[76]
and the adjustments of sub-provinces to the status of provinces.[77] These
measures, too, are used in light of the wider national demand for the
synchronization of elections (considered vis- -vis the regional interests
involved). The adoption of these measures, in other words, is no different
from the exercise by Congress of the inherent police power of the State,
where one of the essential tests is the reasonableness of the interim
measure taken in light of the given circumstances.
Furthermore, the "representative" character of the chosen leaders need not
necessarily be affected by the appointment of OICs as this requirement is
really a function of the appointment process; only the "elective" aspect shall
be supplanted by the appointment of OICs. In this regard, RA No. 10153
significantly seeks to address concerns arising from the appointments by
providing, under Sections 3, 4 and 5 of the assailed law, concrete terms in
the Appointment of OIC, the Manner and Procedure of Appointing OICs, and
their Qualifications.
Based on these considerations, we hold that RA No. 10153 - viewed in its
proper context - is a law that is not violative of the Constitution (specifically,
its autonomy provisions), and one that is reasonable as well under the
circumstances.
VI. Other Constitutional Concerns
Outside of the above concerns, it has been argued during the oral arguments
that upholding the constitutionality of RA No. 10153 would set a dangerous
precedent of giving the President the power to cancel elections anywhere in
the country, thus allowing him to replace elective officials with OICs.
This claim apparently misunderstands that an across-the-board cancellation
of elections is a matter for Congress, not for the President, to address. It is a
power that falls within the powers of Congress in the exercise of its legislative
powers. Even Congress, as discussed above, is limited in what it can
legislatively undertake with respect to elections.
If RA No. 10153 cancelled the regular August 2011 elections, it was for a
very specific and limited purpose - the synchronization of elections. It was a
temporary means to a lasting end - the synchronization of elections. Thus,

RA No. 10153 and the support that the Court gives this legislation are
likewise clear and specific, and cannot be transferred or applied to any other
cause for the cancellation of elections. Any other localized cancellation of
elections and call for special elections can occur only in accordance with the
power already delegated by Congress to the COMELEC, as above
discussed.
Given that the incumbent ARMM elective officials cannot continue to act in a
holdover capacity upon the expiration of their terms, and this Court cannot
compel the COMELEC to conduct special elections, the Court now has to
deal with the dilemma of a vacuum in governance in the ARMM.
To emphasize the dire situation a vacuum brings, it should not be forgotten
that a period of 21 months - or close to 2 years - intervenes from the time
that the incumbent ARMM elective officials' terms expired and the time the
new ARMM elective officials begin their terms in 2013. As the lessons of our
Mindanao history - past and current - teach us, many developments, some of
them critical and adverse, can transpire in the country's Muslim areas in this
span of time in the way they transpired in the past.[78] Thus, it would be
reckless to assume that the presence of an acting ARMM Governor, an
acting Vice-Governor and a fully functioning Regional Legislative Assembly
can be done away with even temporarily. To our mind, the appointment of
OICs under the present circumstances is an absolute necessity.
Significantly, the grant to the President of the power to appoint OICs to
undertake the functions of the elective members of the Regional Legislative
Assembly is neither novel nor innovative. We hark back to our earlier
pronouncement in Menzon v. Petilla, etc., et al.:[79]
It may be noted that under Commonwealth Act No. 588 and the Revised
Administrative Code of 1987, the President is empowered to make temporary
appointments in certain public offices, in case of any vacancy that may occur.
Albeit both laws deal only with the filling of vacancies in appointive positions.
However, in the absence of any contrary provision in the Local Government
Code and in the best interest of public service, we see no cogent reason why
the procedure thus outlined by the two laws may not be similarly applied in
the present case. The respondents contend that the provincial board is the
correct appointing power. This argument has no merit. As between the
President who has supervision over local governments as provided by law
and the members of the board who are junior to the vice-governor, we have
no problem ruling in favor of the President, until the law provides otherwise.
A vacancy creates an anomalous situation and finds no approbation under
the law for it deprives the constituents of their right of representation and
governance in their own local government.

In a republican form of government, the majority rules through their chosen

few, and if one of them is incapacitated or absent, etc., the management of
governmental affairs is, to that extent, may be hampered. Necessarily, there
will be a consequent delay in the delivery of basic services to the people of
Leyte if the Governor or the Vice-Governor is missing.[80](Emphasis ours.)
As in Menzon, leaving the positions of ARMM Governor, Vice Governor, and
members of the Regional Legislative Assembly vacant for 21 months, or
almost 2 years, would clearly cause disruptions and delays in the delivery of
basic services to the people, in the proper management of the affairs of the
regional government, and in responding to critical developments that may
arise. When viewed in this context, allowing the President in the exercise of
his constitutionally-recognized appointment power to appoint OICs is, in our
judgment, a reasonable measure to take.
B. Autonomy in the ARMM
It is further argued that while synchronization may be constitutionally
mandated, it cannot be used to defeat or to impede the autonomy that the
Constitution granted to the ARMM. Phrased in this manner, one would
presume that there exists a conflict between two recognized Constitutional
mandates - synchronization and regional autonomy - such that it is
necessary to choose one over the other.
We find this to be an erroneous approach that violates a basic principle in
constitutional construction - ut magis valeat quam pereat: that the
Constitution is to be interpreted as a whole,[81] and one mandate should not
be given importance over the other except where the primacy of one over the
other is clear.[82] We refer to the Court's declaration in Ang-Angco v.
Castillo, et al.,[83] thus:
A provision of the constitution should not be construed in isolation from the
rest. Rather, the constitution must be interpreted as a whole, and apparently,
conflicting provisions should be reconciled and harmonized in a manner that
may give to all of them full force and effect. [Emphasis supplied.]
Synchronization is an interest that is as constitutionally entrenched as
regional autonomy. They are interests that this Court should reconcile and
give effect to, in the way that Congress did in RA No. 10153 which provides
the measure to transit to synchronized regional elections with the least
disturbance on the interests that must be respected. Particularly, regional
autonomy will be respected instead of being sidelined, as the law does not in
any way alter, change or modify its governing features, except in a very
temporary manner and only as necessitated by the attendant circumstances.

Elsewhere, it has also been argued that the ARMM elections should not be
synchronized with the national and local elections in order to maintain the
autonomy of the ARMM and insulate its own electoral processes from the
rough and tumble of nationwide and local elections. This argument leaves us
far from convinced of its merits.
As heretofore mentioned and discussed, while autonomous regions are
granted political autonomy, the framers of the Constitution never equated
autonomy with independence. The ARMM as a regional entity thus continues
to operate within the larger framework of the State and is still subject to the
national policies set by the national government, save only for those specific
areas reserved by the Constitution for regional autonomous determination.
As reflected during the constitutional deliberations of the provisions on
autonomous regions:

economic, political and social development at the smaller political units are
expected to propel social and economic growth and development. But to
enable the country to develop as a whole, the programs and policies effected
locally must be integrated and coordinated towards a common national goal.
Thus, policy-setting for the entire country still lies in the President and
Congress. [Emphasis ours.]
In other words, the autonomy granted to the ARMM cannot be invoked to
defeat national policies and concerns. Since the synchronization of elections
is not just a regional concern but a national one, the ARMM is subject to it;
the regional autonomy granted to the ARMM cannot be used to exempt the
region from having to act in accordance with a national policy mandated by
no less than the Constitution.
Conclusion

Mr. Bennagen. xxx We do not see here a complete separation from the
central government, but rather an efficient working relationship between the
autonomous region and the central government. We see this as an effective
partnership, not a separation.
Mr. Romulo. Therefore, complete autonomy is not really thought of as
complete independence.
Mr. Ople. We define it as a measure of self-government within the larger
political framework of the nation.[84] [Emphasis supplied.]
This exchange of course is fully and expressly reflected in the above-quoted
Section 17, Article X of the Constitution, and by the express reservation
under Section 1 of the same Article that autonomy shall be "within the
framework of this Constitution and the national sovereignty as well as the
territorial integrity of the Republic of the Philippines."

Congress acted within its powers and pursuant to a constitutional mandate the synchronization of national and local elections - when it enacted RA No.
10153. This Court cannot question the manner by which Congress
undertook this task; the Judiciary does not and cannot pass upon questions
of wisdom, justice or expediency of legislation.[87] As judges, we can only
interpret and apply the law and, despite our doubts about its wisdom, cannot
repeal or amend it.[88]
Nor can the Court presume to dictate the means by which Congress should
address what is essentially a legislative problem. It is not within the Court's
power to enlarge or abridge laws; otherwise, the Court will be guilty of
usurping the exclusive prerogative of Congress.[89] The petitioners, in asking
this Court to compel COMELEC to hold special elections despite its lack of
authority to do so, are essentially asking us to venture into the realm of
judicial legislation, which is abhorrent to one of the most basic principles of a
republican and democratic government - the separation of powers.

Interestingly, the framers of the Constitution initially proposed to remove

Section 17 of Article X, believing it to be unnecessary in light of the
enumeration of powers granted to autonomous regions in Section 20, Article
X of the Constitution. Upon further reflection, the framers decided to reinstate
the provision in order to "make it clear, once and for all, that these are the
limits of the powers of the autonomous government. Those not enumerated
are actually to be exercised by the national government[.]"[85] Of note is the
Court's pronouncement in Pimentel, Jr. v. Hon. Aguirre[86] which we quote:

The petitioners allege, too, that we should act because Congress acted with
grave abuse of discretion in enacting RA No. 10153. Grave abuse of
discretion is such capricious and whimsical exercise of judgment that is
patent and gross as to amount to an evasion of a positive duty or to a virtual
refusal to perform a duty enjoined by law or to act at all in contemplation of
the law as where the power is exercised in an arbitrary and despotic manner
by reason of passion and hostility.[90]

Under the Philippine concept of local autonomy, the national government has
not completely relinquished all its powers over local governments, including
autonomous regions. Only administrative powers over local affairs are
delegated to political subdivisions. The purpose of the delegation is to make
governance more directly responsive and effective at the local levels. In turn,

We find that Congress, in passing RA No. 10153, acted strictly within its
constitutional mandate. Given an array of choices, it acted within due
constitutional bounds and with marked reasonableness in light of the
necessary adjustments that synchronization demands. Congress, therefore,
cannot be accused of any evasion of a positive duty or of a refusal to perform

its duty. We thus find no reason to accord merit to the petitioners' claims of
grave abuse of discretion.
On the general claim that RA No. 10153 is unconstitutional, we can only
reiterate the established rule that every statute is presumed valid.[91]
Congress, thus, has in its favor the presumption of constitutionality of its acts,
and the party challenging the validity of a statute has the onerous task of
rebutting this presumption.[92] Any reasonable doubt about the validity of the
law should be resolved in favor of its constitutionality.[93] As this Court
declared in Garcia v. Executive Secretary:[94]
The policy of the courts is to avoid ruling on constitutional questions and to
presume that the acts of the political departments are valid in the absence of
a clear and unmistakable showing to the contrary. To doubt is to sustain.
This presumption is based on the doctrine of separation of powers which
enjoins upon each department a becoming respect for the acts of the other
departments. The theory is that as the joint act of Congress and the
President of the Philippines, a law has been carefully studied and determined
to be in accordance with the fundamental law before it was finally
enacted.[95] [Emphasis ours.]
Given the failure of the petitioners to rebut the presumption of
constitutionality in favor of RA No. 10153, we must support and confirm its
validity.
WHEREFORE, premises considered, we DISMISS the consolidated petitions
assailing the validity of RA No. 10153 for lack of merit, and UPHOLD the
constitutionality of this law. We likewise LIFT the temporary restraining order
we issued in our Resolution of September 13, 2011. No costs.
SO ORDERED.

[G.R. No. 196271 : February 28, 2012]

DATU MICHAEL ABAS KIDA, IN HIS PERSONAL CAPACITY, AND IN
REPRESENTATION OF MAGUINDANAO FEDERATION OF
AUTONOMOUS IRRIGATORS ASSOCIATION, INC., HADJI MUHMINA J.
USMAN, JOHN ANTHONY L. LIM, JAMILON T. ODIN, ASRIN TIMBOL
JAIYARI, MUJIB M. KALANG, ALIH AL-SAIDI J. SAPI-E, KESSAR
DAMSIE ABDIL, AND BASSAM ALUH SAUPI, PETITIONERS, VS.
SENATE OF THE PHILIPPINES, REPRESENTED BY ITS PRESIDENT
JUAN PONCE ENRILE, HOUSE OF REPRESENTATIVES, THRU
SPEAKER FELICIANO BELMONTE, COMMISSION ON ELECTIONS,
THRU ITS CHAIRMAN, SIXTO BRILLANTES, JR., PAQUITO OCHOA, JR.,
OFFICE OF THE PRESIDENT EXECUTIVE SECRETARY, FLORENCIO
ABAD, JR., SECRETARY OF BUDGET, AND ROBERTO TAN,
TREASURER OF THE PHILIPPINES, RESPONDENTS.
[G.R. NO. 196305]
BASARI D. MAPUPUNO, PETITIONER, VS. SIXTO BRILLANTES, IN HIS
CAPACITY AS CHAIRMAN OF THE COMMISSION ON ELECTIONS,
FLORENCIO ABAD, JR. IN HIS CAPACITY AS SECRETARY OF THE
DEPARTMENT OF BUDGET AND MANAGEMENT, PAQUITO OCHOA,
JR., IN HIS CAPACITY AS EXECUTIVE SECRETARY, JUAN PONCE
ENRILE, IN HIS CAPACITY AS SENATE PRESIDENT, AND FELICIANO
BELMONTE, IN HIS CAPACITY AS SPEAKER OF THE HOUSE OF
REPRESENTATIVES, RESPONDENTS.
[G.R. NO. 197221]
REP. EDCEL C. LAGMAN, PETITIONER, VS. PAQUITO N. OCHOA, JR.,
IN HIS CAPACITY AS THE EXECUTIVE SECRETARY, AND THE
COMMISSION ON ELECTIONS, RESPONDENTS.
[G.R. NO. 197280]
ALMARIM CENTI TILLAH, DATU CASAN CONDING CANA, AND
PARTIDO DEMOKRATIKO PILIPINO LAKAS NG BAYAN (PDP-LABAN),
PETITIONERS, VS. THE COMMISSION ON ELECTIONS, THROUGH ITS
CHAIRMAN, SIXTO BRILLANTES, JR., HON. PAQUITO N. OCHOA, JR.,
IN HIS CAPACITY AS EXECUTIVE SECRETARY, HON. FLORENCIO B.
ABAD, JR., IN HIS CAPACITY AS SECRETARY OF THE DEPARTMENT
OF BUDGET AND MANAGEMENT, AND HON. ROBERTO B. TAN, IN HIS
CAPACITY AS TREASURER OF THE PHILIPPINES, RESPONDENTS.

ATTY. ROMULO B. MACALINTAL, PETITIONER, VS. COMMISSION ON

ELECTIONS AND THE OFFICE OF THE PRESIDENT, THROUGH
EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR., RESPONDENTS.
[G.R. NO. 197392]
LOUIS BAROK C. BIRAOGO, PETITIONER, VS. THE COMMISSION ON
ELECTIONS AND EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR.,
RESPONDENTS.
[G.R. NO. 197454]
JACINTO V. PARAS, PETITIONER, VS. EXECUTIVE SECRETARY
PAQUITO N. OCHOA, JR., AND THE COMMISSION ON ELECTIONS,
RESPONDENTS.
MINORITY RIGHTS FORUM, PHILIPPINES, INC., RESPONDENTSINTERVENOR.
RESOLUTION
BRION, J.:
We resolve: (a) the motion for reconsideration filed by petitioners Datu
Michael Abas Kida, et al. in G.R. No. 196271; (b) the motion for
reconsideration filed by petitioner Rep. Edcel Lagman in G.R. No. 197221;
(c) the ex abundante ad cautelam motion for reconsideration filed by
petitioner Basari Mapupuno in G.R. No. 196305; (d) the motion for
reconsideration filed by petitioner Atty. Romulo Macalintal in G.R. No.
197282; (e) the motion for reconsideration filed by petitioners Almarim Centi
Tillah, Datu Casan Conding Cana and Partido Demokratiko Pilipino Lakas ng
Bayan in G.R. No. 197280; (f) the manifestation and motion filed by
petitioners Almarim Centi Tillah, et al. in G.R. No. 197280; and (g) the very
urgent motion to issue clarificatory resolution that the temporary restraining
order (TRO) is still existing and effective.cralaw
These motions assail our Decision dated October 18, 2011, where we upheld
the constitutionality of Republic Act (RA) No. 10153. Pursuant to the
constitutional mandate of synchronization, RA No. 10153 postponed the
regional elections in the Autonomous Region in Muslim Mindanao (ARMM)
(which were scheduled to be held on the second Monday of August 2011) to
the second Monday of May 2013 and recognized the Presidents power to
appoint officers-in-charge (OICs) to temporarily assume these positions upon
the expiration of the terms of the elected officials.

[G.R. NO. 197282]

The Motions for Reconsideration

The petitioners in G.R. No. 196271 raise the following grounds in support of
their motion:
THE HONORABLE COURT ERRED IN CONCLUDING THAT THE ARMM
ELECTIONS ARE LOCAL ELECTIONS, CONSIDERING THAT THE
CONSTITUTION GIVES THE ARMM A SPECIAL STATUS AND IS
SEPARATE AND DISTINCT FROM ORDINARY LOCAL GOVERNMENT
UNITS.
R.A. 10153 AND R.A. 9333 AMEND THE ORGANIC ACT.
THE SUPERMAJORITY PROVISIONS OF THE ORGANIC ACT (R.A. 9054)
ARE NOT IRREPEALABLE LAWS.

THE CONSTITUTION DOES NOT PROSCRIBE THE HOLDOVER OF

ARMM ELECTED OFFICIALS PENDING THE ELECTION AND
QUALIFICATION OF THEIR SUCCESSORS.
THE RULING IN OSMENA DOES NOT APPLY TO ARMM ELECTED
OFFICIALS WHOSE TERMS OF OFFICE ARE NOT PROVIDED FOR BY
THE CONSTITUTION BUT PRESCRIBED BY THE ORGANIC ACTS.
THE REQUIREMENT OF A SUPERMAJORITY OF VOTES IN THE
HOUSE OF REPRESENTATIVES AND THE SENATE FOR THE VALIDITY
OF A SUBSTANTIVE AMENDMENT OR REVISION OF THE ORGANIC
ACTS DOES NOT IMPOSE AN IRREPEALABLE LAW.

SECTION 3, ARTICLE XVII OF R.A. 9054 DOES NOT VIOLATE SECTION

18, ARTICLE X OF THE CONSTITUTION.

THE REQUIREMENT OF A PLEBISCITE FOR THE EFFECTIVITY OF A

SUBSTANTIVE AMENDMENT OR REVISION OF THE ORGANIC ACTS
DOES NOT UNDULY EXPAND THE PLEBISCITE REQUIREMENT OF THE
CONSTITUTION.

BALANCE OF INTERESTS TILT IN FAVOR OF THE DEMOCRATIC

PRINCIPLE[.][1]

SYNCHRONIZATION OF THE ARMM ELECTION WITH THE NATIONAL

AND LOCAL ELECTIONS IS NOT MANDATED BY THE CONSTITUTION.

The petitioner in G.R. No. 197221 raises similar grounds, arguing that:

THE COMELEC HAS THE AUTHORITY TO HOLD AND CONDUCT

SPECIAL ELECTIONS IN ARMM, AND THE ENACTMENT OF AN
IMPROVIDENT AND UNCONSTITUTIONAL STATUTE IS AN ANALOGOUS
CAUSE
WARRANTING
COMELECS
HOLDING
OF
SPECIAL
ELECTIONS.[2] (italics supplied)

THE ELECTIVE REGIONAL EXECUTIVE AND LEGISLATIVE OFFICIALS

OF ARMM CANNOT BE CONSIDERED AS OR EQUATED WITH THE
TRADITIONAL LOCAL GOVERNMENT OFFICIALS IN THE LOCAL
GOVERNMENT UNITS (LGUs) BECAUSE (A) THERE IS NO EXPLICIT
CONSTITUTIONAL PROVISION ON SUCH PARITY; AND (B) THE ARMM
IS MORE SUPERIOR THAN LGUs IN STRUCTURE, POWERS AND
AUTONOMY, AND CONSEQUENTLY IS A CLASS OF ITS OWN APART
FROM TRADITIONAL LGUs.
THE UNMISTAKABLE AND UNEQUIVOCAL CONSTITUTIONAL MANDATE
FOR AN ELECTIVE AND REPRESENTATIVE EXECUTIVE DEPARTMENT
AND LEGISLATIVE ASSEMBLY IN ARMM INDUBITABLY PRECLUDES
THE APPOINTMENT BY THE PRESIDENT OF OFFICERS-IN-CHARGE
(OICs), ALBEIT MOMENTARY OR TEMPORARY, FOR THE POSITIONS
OF ARMM GOVERNOR, VICE GOVERNOR AND MEMBERS OF THE
REGIONAL ASSEMBLY.
THE PRESIDENTS APPOINTING POWER IS LIMITED TO APPOINTIVE
OFFICIALS AND DOES NOT EXTEND TO ELECTIVE OFFICIALS EVEN
AS THE PRESIDENT IS ONLY VESTED WITH SUPERVISORY POWERS
OVER THE ARMM, THEREBY NEGATING THE AWESOME POWER TO
APPOINT AND REMOVE OICs OCCUPYING ELECTIVE POSITIONS.

The petitioner in G.R. No. 196305 further asserts that:

BEFORE THE COURT MAY CONSTRUE OR INTERPRET A STATUTE, IT
IS A CONDITION SINE QUA NON THAT THERE BE DOUBT OR
AMBIGUITY IN ITS LANGUAGE.
THE TRANSITORY PROVISIONS HOWEVER ARE CLEAR AND
UNAMBIGUOUS: THEY REFER TO THE 1992 ELECTIONS AND TURNOVER OF ELECTIVE OFFICIALS.
IN THUS RECOGNIZING A SUPPOSED INTENT OF THE FRAMERS,
AND APPLYING THE SAME TO ELECTIONS 20 YEARS AFTER, THE
HONORABLE SUPREME COURT MAY HAVE VIOLATED THE
FOREMOST RULE IN STATUTORY CONSTRUCTION.
xxxx

THE HONORABLE COURT SHOULD HAVE CONSIDERED THAT RA 9054,

AN ORGANIC ACT, WAS COMPLETE IN ITSELF. HENCE, RA 10153
SHOULD BE CONSIDERED TO HAVE BEEN ENACTED PRECISELY TO
AMEND RA 9054.

THE HONORABLE COURT ERRED IN RULING THAT THE APPOINTMENT

BY THE PRESIDENT OF OICs FOR THE ARMM REGIONAL
GOVERNMENT IS NOT VIOLATIVE OF THE CONSTITUTION.
C.

xxxx
THE HONORABLE COURT MAY HAVE COMMITTED A SERIOUS ERROR
IN DECLARING THE 2/3 VOTING REQUIREMENT SET FORTH IN RA
9054 AS UNCONSTITUTIONAL.
xxxx
THE HONORABLE COURT MAY HAVE COMMITTED A SERIOUS ERROR
IN HOLDING THAT A PLEBISCITE IS NOT NECESSARY IN AMENDING
THE ORGANIC ACT.
xxxx
THE HONORABLE COURT COMMITTED A SERIOUS ERROR IN
DECLARING THE HOLD-OVER OF ARMM ELECTIVE OFFICIALS
UNCONSTITUTIONAL.

THE HOLDOVER PRINCIPLE ADOPTED IN R.A. NO. 9054 DOES NOT

VIOLATE THE CONSTITUTION, AND BEFORE THEIR SUCCESSORS
ARE ELECTED IN EITHER AN ELECTION TO BE HELD AT THE
SOONEST POSSIBLE TIME OR IN MAY 2013, THE SAID INCUMBENT
ARMM REGIONAL OFFICIALS MAY VALIDLY CONTINUE FUNCTIONING
AS SUCH IN A HOLDOVER CAPACITY IN ACCORDANCE WITH SECTION
7, ARTICLE VII OF R.A. NO. 9054.
D.
WITH THE CANCELLATION OF THE AUGUST 2011 ARMM ELECTIONS,
SPECIAL ELECTIONS MUST IMMEDIATELY BE HELD FOR THE
ELECTIVE REGIONAL OFFICIALS OF THE ARMM WHO SHALL SERVE
UNTIL THEIR SUCCESSORS ARE ELECTED IN THE MAY 2013
SYNCHRONIZED ELECTIONS.[4]
Finally, the petitioners in G.R. No. 197280 argue that:

xxxx
THE HONORABLE COURT COMMITTED A SERIOUS ERROR IN
UPHOLDING THE APPOINTMENT OF OFFICERS-IN-CHARGE.[3] (italics
and underscoring supplied)
The petitioner in G.R. No. 197282 contends that:
A.
ASSUMING WITHOUT CONCEDING THAT THE APPOINTMENT OF OICs
FOR THE REGIONAL GOVERNMENT OF THE ARMM IS NOT
UNCONSTITUTIONAL TO BEGIN WITH, SUCH APPOINTMENT OF OIC
REGIONAL OFFICIALS WILL CREATE A FUNDAMENTAL CHANGE IN
THE BASIC STRUCTURE OF THE REGIONAL GOVERNMENT SUCH
THAT R.A. NO. 10153 SHOULD HAVE BEEN SUBMITTED TO A
PLEBISCITE IN THE ARMM FOR APPROVAL BY ITS PEOPLE, WHICH
PLEBISCITE REQUIREMENT CANNOT BE CIRCUMVENTED BY SIMPLY
CHARACTERIZING THE PROVISIONS OF R.A. NO. 10153 ON
APPOINTMENT OF OICs AS AN INTERIM MEASURE.
B.

a)
the Constitutional mandate of synchronization does not apply to the ARMM
elections;
b)
RA No. 10153 negates the basic principle of republican democracy which, by
constitutional mandate, guides the governance of the Republic;
c)
RA No. 10153 amends the Organic Act (RA No. 9054) and, thus, has to
comply with the 2/3 vote from the House of Representatives and the Senate,
voting separately, and be ratified in a plebiscite;
d)
if the choice is between elective officials continuing to hold their offices even
after their terms are over and non-elective individuals getting into the vacant
elective positions by appointment as OICs, the holdover option is the better
choice;
e)
the President only has the power of supervision over autonomous regions,
which does not include the power to appoint OICs to take the place of ARMM
elective officials; and
f)

it would be better to hold the ARMM elections separately from the national
and local elections as this will make it easier for the authorities to implement
election laws.

Section 2. The Senators, Members of the House of Representatives, and the

local officials first elected under this Constitution shall serve until noon of
June 30, 1992.

In essence, the Court is asked to resolve the following questions:

Of the Senators elected in the elections in 1992, the first twelve obtaining the
highest number of votes shall serve for six years and the remaining twelve
for three years.

(a)
Does the Constitution mandate the synchronization of ARMM regional
elections with national and local elections?
(b)
Does RA No. 10153 amend RA No. 9054? If so, does RA No. 10153 have to
comply with the supermajority vote and plebiscite requirements?
(c)
Is the holdover provision in RA No. 9054 constitutional?
(d)
Does the COMELEC have the power to call for special elections in ARMM?
(e)
Does granting the President the power to appoint OICs violate the elective
and representative nature of ARMM regional legislative and executive
offices?
(f)
Does the appointment power granted to the President exceed the Presidents
supervisory powers over autonomous regions?

xxx x
Section 5. The six-year term of the incumbent President and Vice-President
elected in the February 7, 1986 election is, for purposes of synchronization of
elections, hereby extended to noon of June 30, 1992.
The first regular elections for the President and Vice-President under this
Constitution shall be held on the second Monday of May, 1992.
To fully appreciate the constitutional intent behind these provisions, we refer
to the discussions of the Constitutional Commission:
MR. MAAMBONG. For purposes of identification, I will now read a section
which we will temporarily indicate as Section 14. It reads: THE SENATORS,
MEMBERS OF THE HOUSE OF REPRESENTATIVES AND THE LOCAL
OFFICIALS ELECTED IN THE FIRST ELECTION SHALL SERVE FOR FIVE
YEARS, TO EXPIRE AT NOON OF JUNE 1992.

The Courts Ruling

This was presented by Commissioner Davide, so may we ask that
Commissioner Davide be recognized.
We deny the motions for lack of merit.
Synchronization mandate includes ARMM elections
The Court was unanimous in holding that the Constitution mandates the
synchronization of national and local elections. While the Constitution does
not expressly instruct Congress to synchronize the national and local
elections, the intention can be inferred from the following provisions of the
Transitory Provisions (Article XVIII) of the Constitution, which state:
Section 1. The first elections of Members of the Congress under this
Constitution shall be held on the second Monday of May, 1987.
The first local elections shall be held on a date to be determined by the
President, which may be simultaneous with the election of the Members of
the Congress. It shall include the election of all Members of the city or
municipal councils in the Metropolitan Manila area.

THE PRESIDING OFFICER (Mr. Rodrigo). Commissioner Davide is

recognized.
MR. DAVIDE. Before going to the proposed amendment, I would only state
that in view of the action taken by the Commission on Section 2 earlier, I am
formulating a new proposal. It will read as follows: THE SENATORS,
MEMBERS OF THE HOUSE OF REPRESENTATIVES AND THE LOCAL
OFFICIALS FIRST ELECTED UNDER THIS CONSTITUTION SHALL
SERVE UNTIL NOON OF JUNE 30, 1992.
I proposed this because of the proposed section of the Article on Transitory
Provisions giving a term to the incumbent President and Vice-President until
1992. Necessarily then, since the term provided by the Commission for
Members of the Lower House and for local officials is three years, if there will
be an election in 1987, the next election for said officers will be in 1990, and
it would be very close to 1992. We could never attain, subsequently, any
synchronization of election which is once every three years.

So under my proposal we will be able to begin actual synchronization in

1992, and consequently, we should not have a local election or an election
for Members of the Lower House in 1990 for them to be able to complete
their term of three years each. And if we also stagger the Senate, upon the
first election it will result in an election in 1993 for the Senate alone, and
there will be an election for 12 Senators in 1990. But for the remaining 12
who will be elected in 1987, if their term is for six years, their election will be
in 1993. So, consequently we will have elections in 1990, in 1992 and in
1993. The later election will be limited to only 12 Senators and of course to
the local officials and the Members of the Lower House. But, definitely,
thereafter we can never have an election once every three years, therefore
defeating the very purpose of the Commission when we adopted the term of
six years for the President and another six years for the Senators with the
possibility of staggering with 12 to serve for six years and 12 for three years
insofar as the first Senators are concerned. And so my proposal is the only
way to effect the first synchronized election which would mean, necessarily,
a bonus of two years to the Members of the Lower House and a bonus of two
years to the local elective officials.

xxxx
MR. GUINGONA. What will be synchronized, therefore, is the election of the
incumbent President and Vice-President in 1992.
MR. DAVIDE. Yes.
MR. GUINGONA. Not the reverse. Will the committee not synchronize the
election of the Senators and local officials with the election of the President?
MR. DAVIDE. It works both ways, Mr. Presiding Officer. The attempt here is
on the assumption that the provision of the Transitory Provisions on the term
of the incumbent President and Vice-President would really end in 1992.
MR. GUINGONA. Yes.
MR. DAVIDE. In other words, there will be a single election in 1992 for all,
from the President up to the municipal officials.[5] (emphases and
underscoring ours)

THE PRESIDING OFFICER (Mr. Rodrigo). What does the committee say?
MR. DE CASTRO. Mr. Presiding Officer.
THE PRESIDING OFFICER (Mr. Rodrigo). Commissioner de Castro is
recognized.

The framers of the Constitution could not have expressed their objective
more clearly there was to be a single election in 1992 for all elective
officials from the President down to the municipal officials. Significantly, the
framers were even willing to temporarily lengthen or shorten the terms of
elective officials in order to meet this objective, highlighting the importance of
this constitutional mandate.

MR. DE CASTRO. Thank you.

During the discussion on the legislative and the synchronization of elections,
I was the one who proposed that in order to synchronize the elections every
three years, which the body approved the first national and local officials
to be elected in 1987 shall continue in office for five years, the same thing the
Honorable Davide is now proposing. That means they will all serve until
1992, assuming that the term of the President will be for six years and
continue beginning in 1986. So from 1992, we will again have national, local
and presidential elections. This time, in 1992, the President shall have a term
until 1998 and the first 12 Senators will serve until 1998, while the next 12
shall serve until 1995, and then the local officials elected in 1992 will serve
until 1995. From then on, we shall have an election every three years.
So, I will say that the proposition of Commissioner Davide is in order, if we
have to synchronize our elections every three years which was already
approved by the body.
Thank you, Mr. Presiding Officer.

We came to the same conclusion in Osmea v. Commission on Elections,[6]

where we unequivocally stated that the Constitution has mandated
synchronized national and local elections."[7] Despite the length and
verbosity of their motions, the petitioners have failed to convince us to
deviate from this established ruling.
Neither do we find any merit in the petitioners contention that the ARMM
elections are not covered by the constitutional mandate of synchronization
because the ARMM elections were not specifically mentioned in the abovequoted Transitory Provisions of the Constitution.
That the ARMM elections were not expressly mentioned in the Transitory
Provisions of the Constitution on synchronization cannot be interpreted to
mean that the ARMM elections are not covered by the constitutional mandate
of synchronization. We have to consider that the ARMM, as we now know it,
had not yet been officially organized at the time the Constitution was enacted
and ratified by the people. Keeping in mind that a constitution is not intended
to provide merely for the exigencies of a few years but is to endure through

generations for as long as it remains unaltered by the people as ultimate

sovereign, a constitution should be construed in the light of what actually is a
continuing instrument to govern not only the present but also the unfolding
events of the indefinite future. Although the principles embodied in a
constitution remain fixed and unchanged from the time of its adoption, a
constitution must be construed as a dynamic process intended to stand for a
great length of time, to be progressive and not static.[8]
To reiterate, Article X of the Constitution, entitled Local Government, clearly
shows the intention of the Constitution to classify autonomous regions, such
as the ARMM, as local governments. We refer to Section 1 of this Article,
which provides:
Section 1. The territorial and political subdivisions of the Republic of the
Philippines are the provinces, cities, municipalities, and barangays. There
shall be autonomous regions in Muslim Mindanao and the Cordilleras as
hereinafter provided.
The inclusion of autonomous regions in the enumeration of political
subdivisions of the State under the heading Local Government indicates
quite clearly the constitutional intent to consider autonomous regions as one
of the forms of local governments.
That the Constitution mentions only the national government and the local
governments, and does not make a distinction between the local
government and the regional government, is particularly revealing,
betraying as it does the intention of the framers of the Constitution to
consider the autonomous regions not as separate forms of government, but
as political units which, while having more powers and attributes than other
local government units, still remain under the category of local governments.
Since autonomous regions are classified as local governments, it follows that
elections held in autonomous regions are also considered as local elections.
The petitioners further argue that even assuming that the Constitution
mandates the synchronization of elections, the ARMM elections are not
covered by this mandate since they are regional elections and not local
elections.
In construing provisions of the Constitution, the first rule is verba legis, that
is, wherever possible, the words used in the Constitution must be given their
ordinary meaning except where technical terms are employed.[9] Applying
this principle to determine the scope of local elections, we refer to the
meaning of the word local, as understood in its ordinary sense. As defined
in Websters Third New International Dictionary Unabridged, local refers to
something that primarily serves the needs of a particular limited district,
often a community or minor political subdivision. Obviously, the ARMM

elections, which are held within the confines of the autonomous region of
Muslim Mindanao, fall within this definition.
To be sure, the fact that the ARMM possesses more powers than other
provinces, cities, or municipalities is not enough reason to treat the ARMM
regional elections differently from the other local elections. Ubi lex non
distinguit nec nos distinguire debemus. When the law does not distinguish,
we must not distinguish.[10]
RA No. 10153 does not amend RA No. 9054
The petitioners are adamant that the provisions of RA No. 10153, in
postponing the ARMM elections, amend RA No. 9054.
We cannot agree with their position.
A thorough reading of RA No. 9054 reveals that it fixes the schedule for only
the first ARMM elections;[11] it does not provide the date for the succeeding
regular ARMM elections. In providing for the date of the regular ARMM
elections, RA No. 9333 and RA No. 10153 clearly do not amend RA No.
9054 since these laws do not change or revise any provision in RA No. 9054.
In fixing the date of the ARMM elections subsequent to the first election, RA
No. 9333 and RA No. 10153 merely filled the gap left in RA No. 9054.
We reiterate our previous observations:
This view that Congress thought it best to leave the determination of the
date of succeeding ARMM elections to legislative discretion finds support in
ARMMs recent history.
To recall, RA No. 10153 is not the first law passed that rescheduled the
ARMM elections. The First Organic Act RA No. 6734 not only did not fix
the date of the subsequent elections; it did not even fix the specific date of
the first ARMM elections, leaving the date to be fixed in another legislative
enactment. Consequently, RA No. 7647, RA No. 8176, RA No. 8746, RA No.
8753, and RA No. 9012 were all enacted by Congress to fix the dates of the
ARMM elections. Since these laws did not change or modify any part or
provision of RA No. 6734, they were not amendments to this latter law.
Consequently, there was no need to submit them to any plebiscite for
ratification.
The Second Organic Act RA No. 9054 which lapsed into law on March
31, 2001, provided that the first elections would be held on the second
Monday of September 2001. Thereafter, Congress passed RA No. 9140 to
reset the date of the ARMM elections. Significantly, while RA No. 9140 also
scheduled the plebiscite for the ratification of the Second Organic Act (RA

No. 9054), the new date of the ARMM regional elections fixed in RA No.
9140 was not among the provisions ratified in the plebiscite held to approve
RA No. 9054. Thereafter, Congress passed RA No. 9333, which further reset
the date of the ARMM regional elections. Again, this law was not ratified
through a plebiscite.
From these legislative actions, we see the clear intention of Congress to treat
the laws which fix the date of the subsequent ARMM elections as separate
and distinct from the Organic Acts. Congress only acted consistently with this
intent when it passed RA No. 10153 without requiring compliance with the
amendment prerequisites embodied in Section 1 and Section 3, Article XVII
of RA No. 9054.[12] (emphases supplied)
The petitioner in G.R. No. 196305 contends, however, that there is no lacuna
in RA No. 9054 as regards the date of the subsequent ARMM elections. In
his estimation, it can be implied from the provisions of RA No. 9054 that the
succeeding elections are to be held three years after the date of the first
ARMM regional elections.
We find this an erroneous assertion. Well-settled is the rule that the court
may not, in the guise of interpretation, enlarge the scope of a statute and
include therein situations not provided nor intended by the lawmakers. An
omission at the time of enactment, whether careless or calculated, cannot be
judicially supplied however later wisdom may recommend the inclusion.[13]
Courts are not authorized to insert into the law what they think should be in it
or to supply what they think the legislature would have supplied if its attention
had been called to the omission.[14] Providing for lapses within the law falls
within the exclusive domain of the legislature, and courts, no matter how
well-meaning, have no authority to intrude into this clearly delineated space.
Since RA No. 10153 does not amend, but merely fills in the gap in RA No.
9054, there is no need for RA No. 10153 to comply with the amendment
requirements set forth in Article XVII of RA No. 9054.

A state legislature has a plenary law-making power over all subjects, whether
pertaining to persons or things, within its territorial jurisdiction, either to
introduce new laws or repeal the old, unless prohibited expressly or by
implication by the federal constitution or limited or restrained by its own. It
cannot bind itself or its successors by enacting irrepealable laws except
when so restrained. Every legislative body may modify or abolish the acts
passed by itself or its predecessors. This power of repeal may be exercised
at the same session at which the original act was passed; and even while a
bill is in its progress and before it becomes a law. This legislature cannot
bind a future legislature to a particular mode of repeal. It cannot declare in
advance the intent of subsequent legislatures or the effect of subsequent
legislation upon existing statutes. [emphasis ours]
Under our Constitution, each House of Congress has the power to approve
bills by a mere majority vote, provided there is quorum.[17] In requiring all
laws which amend RA No. 9054 to comply with a higher voting requirement
than the Constitution provides (2/3 vote), Congress, which enacted RA No.
9054, clearly violated the very principle which we sought to establish in
Duarte. To reiterate, the act of one legislature is not binding upon, and
cannot tie the hands of, future legislatures.[18]
We also highlight an important point raised by Justice Antonio T. Carpio in
his dissenting opinion, where he stated: Section 1, Article XVII of RA 9054
erects a high vote threshold for each House of Congress to surmount,
effectively and unconstitutionally, taking RA 9054 beyond the reach of
Congress amendatory powers. One Congress cannot limit or reduce the
plenary legislative power of succeeding Congresses by requiring a higher
vote threshold than what the Constitution requires to enact, amend or repeal
laws. No law can be passed fixing such a higher vote threshold because
Congress has no power, by ordinary legislation, to amend the
Constitution.[19]
Plebiscite requirement in RA No. 9054 overly broad

Supermajority vote requirement makes RA No. 9054 an irrepealable law

Even assuming that RA No. 10153 amends RA No. 9054, however, we have
already established that the supermajority vote requirement set forth in
Section 1, Article XVII of RA No. 9054[15] is unconstitutional for violating the
principle that Congress cannot pass irrepealable laws.
The power of the legislature to make laws includes the power to amend and
repeal these laws. Where the legislature, by its own act, attempts to limit its
power to amend or repeal laws, the Court has the duty to strike down such
act for interfering with the plenary powers of Congress. As we explained in
Duarte v. Dade:[16]

Similarly, we struck down the petitioners contention that the plebiscite

requirement[20] applies to all amendments of RA No. 9054 for being an
unreasonable enlargement of the plebiscite requirement set forth in the
Constitution.
Section 18, Article X of the Constitution provides that [t]he creation of the
autonomous region shall be effective when approved by majority of the votes
cast by the constituent units in a plebiscite called for the purpose[.] We
interpreted this to mean that only amendments to, or revisions of, the
Organic Act constitutionally-essential to the creation of autonomous regions
i.e., those aspects specifically mentioned in the Constitution which

Congress must provide for in the Organic Act[21] require ratification

through a plebiscite. We stand by this interpretation.
The petitioners argue that to require all amendments to RA No. 9054 to
comply with the plebiscite requirement is to recognize that sovereignty
resides primarily in the people.
While we agree with the petitioners underlying premise that sovereignty
ultimately resides with the people, we disagree that this legal reality
necessitates compliance with the plebiscite requirement for all amendments
to RA No. 9054. For if we were to go by the petitioners interpretation of
Section 18, Article X of the Constitution that all amendments to the Organic
Act have to undergo the plebiscite requirement before becoming effective,
this would lead to impractical and illogical results hampering the ARMMs
progress by impeding Congress from enacting laws that timely address
problems as they arise in the region, as well as weighing down the ARMM
government with the costs that unavoidably follow the holding of a plebiscite.
Interestingly, the petitioner in G.R. No. 197282 posits that RA No. 10153, in
giving the President the power to appoint OICs to take the place of the
elective officials of the ARMM, creates a fundamental change in the basic
structure of the government, and thus requires compliance with the plebiscite
requirement embodied in RA No. 9054.
Again, we disagree.
The pertinent provision in this regard is Section 3 of RA No. 10153, which
reads:
Section 3. Appointment of Officers-in-Charge. The President shall appoint
officers-in-charge for the Office of the Regional Governor, Regional Vice
Governor and Members of the Regional Legislative Assembly who shall
perform the functions pertaining to the said offices until the officials duly
elected in the May 2013 elections shall have qualified and assumed office.
We cannot see how the above-quoted provision has changed the basic
structure of the ARMM regional government. On the contrary, this provision
clearly preserves the basic structure of the ARMM regional government when
it recognizes the offices of the ARMM regional government and directs the
OICs who shall temporarily assume these offices to perform the functions
pertaining to the said offices.

their positions in a holdover capacity. The petitioners essentially argue that

the ARMM regional officials should be allowed to remain in their respective
positions until the May 2013 elections since there is no specific provision in
the Constitution which prohibits regional elective officials from performing
their duties in a holdover capacity.
The pertinent provision of the Constitution is Section 8, Article X which
provides:
Section 8. The term of office of elective local officials, except barangay
officials, which shall be determined by law, shall be three years and no such
official shall serve for more than three consecutive terms. [emphases ours]
On the other hand, Section 7(1), Article VII of RA No. 9054 provides:
Section 7. Terms of Office of Elective Regional Officials. (1) Terms of
Office. The terms of office of the Regional Governor, Regional Vice Governor
and members of the Regional Assembly shall be for a period of three (3)
years, which shall begin at noon on the 30th day of September next following
the day of the election and shall end at noon of the same date three (3) years
thereafter. The incumbent elective officials of the autonomous region shall
continue in effect until their successors are elected and qualified.
The clear wording of Section 8, Article X of the Constitution expresses the
intent of the framers of the Constitution to categorically set a limitation on the
period within which all elective local officials can occupy their offices. We
have already established that elective ARMM officials are also local officials;
they are, thus, bound by the three-year term limit prescribed by the
Constitution. It, therefore, becomes irrelevant that the Constitution does not
expressly prohibit elective officials from acting in a holdover capacity. Short
of amending the Constitution, Congress has no authority to extend the threeyear term limit by inserting a holdover provision in RA No. 9054. Thus, the
term of three years for local officials should stay at three (3) years, as fixed
by the Constitution, and cannot be extended by holdover by Congress.

Unconstitutionality of the holdover provision

Admittedly, we have, in the past, recognized the validity of holdover

provisions in various laws. One significant difference between the present
case and these past cases[22] is that while these past cases all refer to
elective barangay or sangguniang kabataan officials whose terms of office
are not explicitly provided for in the Constitution, the present case refers to
local elective officials - the ARMM Governor, the ARMM Vice Governor, and
the members of the Regional Legislative Assembly - whose terms fall within
the three-year term limit set by Section 8, Article X of the Constitution.

The petitioners are one in defending the constitutionality of Section 7(1),

Article VII of RA No. 9054, which allows the regional officials to remain in

Even assuming that a holdover is constitutionally permissible, and there had

been statutory basis for it (namely Section 7, Article VII of RA No. 9054), the

rule of holdover can only apply as an available option where no express or

implied legislative intent to the contrary exists; it cannot apply where such
contrary intent is evident.[23]
Congress, in passing RA No. 10153 and removing the holdover option, has
made it clear that it wants to suppress the holdover rule expressed in RA No.
9054. Congress, in the exercise of its plenary legislative powers, has clearly
acted within its discretion when it deleted the holdover option, and this Court
has no authority to question the wisdom of this decision, absent any
evidence of unconstitutionality or grave abuse of discretion. It is for the
legislature and the executive, and not this Court, to decide how to fill the
vacancies in the ARMM regional government which arise from the legislature
complying with the constitutional mandate of synchronization.
COMELEC has no authority to hold special elections
Neither do we find any merit in the contention that the Commission on
Elections (COMELEC) is sufficiently empowered to set the date of special
elections in the ARMM. To recall, the Constitution has merely empowered
the COMELEC to enforce and administer all laws and regulations relative to
the conduct of an election.[24] Although the legislature, under the Omnibus
Election Code (Batas Pambansa Bilang [BP] 881), has granted the
COMELEC the power to postpone elections to another date, this power is
confined to the specific terms and circumstances provided for in the law.
Specifically, this power falls within the narrow confines of the following
provisions:
Section 5. Postponement of election. - When for any serious cause such as
violence, terrorism, loss or destruction of election paraphernalia or records,
force majeure, and other analogous causes of such a nature that the holding
of a free, orderly and honest election should become impossible in any
political subdivision, the Commission, motu proprio or upon a verified petition
by any interested party, and after due notice and hearing, whereby all
interested parties are afforded equal opportunity to be heard, shall postpone
the election therein to a date which should be reasonably close to the date of
the election not held, suspended or which resulted in a failure to elect but not
later than thirty days after the cessation of the cause for such postponement
or suspension of the election or failure to elect.
Section 6. Failure of election. - If, on account of force majeure, violence,
terrorism, fraud, or other analogous causes the election in any polling place
has not been held on the date fixed, or had been suspended before the hour
fixed by law for the closing of the voting, or after the voting and during the
preparation and the transmission of the election returns or in the custody or
canvass thereof, such election results in a failure to elect, and in any of such
cases the failure or suspension of election would affect the result of the

election, the Commission shall, on the basis of a verified petition by any

interested party and after due notice and hearing, call for the holding or
continuation of the election not held, suspended or which resulted in a failure
to elect on a date reasonably close to the date of the election not held,
suspended or which resulted in a failure to elect but not later than thirty days
after the cessation of the cause of such postponement or suspension of the
election or failure to elect. [emphases and underscoring ours]
As we have previously observed in our assailed decision, both Section 5 and
Section 6 of BP 881 address instances where elections have already been
scheduled to take place but do not occur or had to be suspended because of
unexpected and unforeseen circumstances, such as violence, fraud,
terrorism, and other analogous circumstances.
In contrast, the ARMM elections were postponed by law, in furtherance of the
constitutional mandate of synchronization of national and local elections.
Obviously, this does not fall under any of the circumstances contemplated by
Section 5 or Section 6 of BP 881.
More importantly, RA No. 10153 has already fixed the date for the next
ARMM elections and the COMELEC has no authority to set a different
election date.
Even assuming that the COMELEC has the authority to hold special
elections, and this Court can compel the COMELEC to do so, there is still the
problem of having to shorten the terms of the newly elected officials in order
to synchronize the ARMM elections with the May 2013 national and local
elections. Obviously, neither the Court nor the COMELEC has the authority
to do this, amounting as it does to an amendment of Section 8, Article X of
the Constitution, which limits the term of local officials to three years.
Presidents authority to appoint OICs
The petitioner in G.R. No. 197221 argues that the Presidents power to
appoint pertains only to appointive positions and cannot extend to positions
held by elective officials.
The power to appoint has traditionally been recognized as executive in
nature.[25] Section 16, Article VII of the Constitution describes in broad
strokes the extent of this power, thus:
Section 16. The President shall nominate and, with the consent of the
Commission on Appointments, appoint the heads of the executive
departments, ambassadors, other public ministers and consuls, or officers of
the armed forces from the rank of colonel or naval captain, and other officers
whose appointments are vested in him in this Constitution. He shall also

appoint all other officers of the Government whose appointments are not
otherwise provided for by law, and those whom he may be authorized by law
to appoint. The Congress may, by law, vest the appointment of other officers
lower in rank in the President alone, in the courts, or in the heads of
departments, agencies, commissions, or boards. [emphasis ours]
The 1935 Constitution contained a provision similar to the one quoted above.
Section 10(3), Article VII of the 1935 Constitution provides:
(3) The President shall nominate and with the consent of the Commission on
Appointments, shall appoint the heads of the executive departments and
bureaus, officers of the Army from the rank of colonel, of the Navy and Air
Forces from the rank of captain or commander, and all other officers of the
Government whose appointments are not herein otherwise provided for, and
those whom he may be authorized by law to appoint; but the Congress may
by law vest the appointment of inferior officers, in the President alone, in the
courts, or in the heads of departments. [emphasis ours]

law, and those whom he may be authorized by law to appoint.[27] The

second sentence acts as the catch-all provision for the Presidents
appointment power, in recognition of the fact that the power to appoint is
essentially executive in nature.[28] The wide latitude given to the President to
appoint is further demonstrated by the recognition of the Presidents power to
appoint officials whose appointments are not even provided for by law. In
other words, where there are offices which have to be filled, but the law does
not provide the process for filling them, the Constitution recognizes the power
of the President to fill the office by appointment.
Any limitation on or qualification to the exercise of the Presidents
appointment power should be strictly construed and must be clearly stated in
order to be recognized.[29] Given that the President derives his power to
appoint OICs in the ARMM regional government from law, it falls under the
classification of presidential appointments covered by the second sentence
of Section 16, Article VII of the Constitution; the Presidents appointment
power thus rests on clear constitutional basis.

The main distinction between the provision in the 1987 Constitution and its
counterpart in the 1935 Constitution is the sentence construction; while in the
1935 Constitution, the various appointments the President can make are
enumerated in a single sentence, the 1987 Constitution enumerates the
various appointments the President is empowered to make and divides the
enumeration in two sentences. The change in style is significant; in providing
for this change, the framers of the 1987 Constitution clearly sought to make a
distinction between the first group of presidential appointments and the
second group of presidential appointments, as made evident in the following
exchange:

The petitioners also jointly assert that RA No. 10153, in granting the
President the power to appoint OICs in elective positions, violates Section
16, Article X of the Constitution,[30] which merely grants the President the
power of supervision over autonomous regions.

MR. FOZ. Madame President x x x I propose to put a period (.) after captain
and x x x delete and all and substitute it with HE SHALL ALSO APPOINT
ANY.

The power of supervision is defined as the power of a superior officer to see

to it that lower officers perform their functions in accordance with law.[31]
This is distinguished from the power of control or the power of an officer to
alter or modify or set aside what a subordinate officer had done in the
performance of his duties and to substitute the judgment of the former for the
latter.[32]

MR. REGALADO. Madam President, the Committee accepts the proposed

amendment because it makes it clear that those other officers mentioned
therein do not have to be confirmed by the Commission on
Appointments.[26]
The first group of presidential appointments, specified as the heads of the
executive departments, ambassadors, other public ministers and consuls, or
officers of the Armed Forces, and other officers whose appointments are
vested in the President by the Constitution, pertains to the appointive officials
who have to be confirmed by the Commission on Appointments.
The second group of officials the President can appoint are all other officers
of the Government whose appointments are not otherwise provided for by

This is an overly restrictive interpretation of the Presidents appointment

power. There is no incompatibility between the Presidents power of
supervision over local governments and autonomous regions, and the power
granted to the President, within the specific confines of RA No. 10153, to
appoint OICs.

The petitioners apprehension regarding the Presidents alleged power of

control over the OICs is rooted in their belief that the Presidents appointment
power includes the power to remove these officials at will. In this way, the
petitioners foresee that the appointed OICs will be beholden to the President,
and act as representatives of the President and not of the people.
Section 3 of RA No. 10153 expressly contradicts the petitioners supposition.
The provision states:

Section 3. Appointment of Officers-in-Charge. The President shall appoint

officers-in-charge for the Office of the Regional Governor, Regional Vice
Governor and Members of the Regional Legislative Assembly who shall
perform the functions pertaining to the said offices until the officials duly
elected in the May 2013 elections shall have qualified and assumed office.
The wording of the law is clear. Once the President has appointed the OICs
for the offices of the Governor, Vice Governor and members of the Regional
Legislative Assembly, these same officials will remain in office until they are
replaced by the duly elected officials in the May 2013 elections. Nothing in
this provision even hints that the President has the power to recall the
appointments he already made. Clearly, the petitioners fears in this regard
are more apparent than real.
RA No. 10153 as an interim measure
We reiterate once more the importance of considering RA No. 10153 not in a
vacuum, but within the context it was enacted in. In the first place, Congress
enacted RA No. 10153 primarily to heed the constitutional mandate to
synchronize the ARMM regional elections with the national and local
elections. To do this, Congress had to postpone the scheduled ARMM
elections for another date, leaving it with the problem of how to provide the
ARMM with governance in the intervening period, between the expiration of
the term of those elected in August 2008 and the assumption to office
twenty-one (21) months away of those who will win in the synchronized
elections on May 13, 2013.
In our assailed Decision, we already identified the three possible solutions
open to Congress to address the problem created by synchronization (a)
allow the incumbent officials to remain in office after the expiration of their
terms in a holdover capacity; (b) call for special elections to be held, and
shorten the terms of those to be elected so the next ARMM regional elections
can be held on May 13, 2013; or (c) recognize that the President, in the
exercise of his appointment powers and in line with his power of supervision
over the ARMM, can appoint interim OICs to hold the vacated positions in the
ARMM regional government upon the expiration of their terms. We have
already established the unconstitutionality of the first two options, leaving us
to consider the last available option.
In this way, RA No. 10153 is in reality an interim measure, enacted to
respond to the adjustment that synchronization requires. Given the context,
we have to judge RA No. 10153 by the standard of reasonableness in
responding to the challenges brought about by synchronizing the ARMM
elections with the national and local elections. In other words, given the plain
unconstitutionality of providing for a holdover and the unavailability of
constitutional possibilities for lengthening or shortening the term of the

elected ARMM officials, is the choice of the Presidents power to appoint

for a fixed and specific period as an interim measure, and as allowed under
Section 16, Article VII of the Constitution an unconstitutional or
unreasonable choice for Congress to make?[33]
We admit that synchronization will temporarily disrupt the election process in
a local community, the ARMM, as well as the communitys choice of leaders.
However, we have to keep in mind that the adoption of this measure is a
matter of necessity in order to comply with a mandate that the Constitution
itself has set out for us. Moreover, the implementation of the provisions of RA
No. 10153 as an interim measure is comparable to the interim measures
traditionally practiced when, for instance, the President appoints officials
holding elective offices upon the creation of new local government units.
The grant to the President of the power to appoint OICs in place of the
elective members of the Regional Legislative Assembly is neither novel nor
innovative. The power granted to the President, via RA No. 10153, to appoint
members of the Regional Legislative Assembly is comparable to the power
granted by BP 881 (the Omnibus Election Code) to the President to fill any
vacancy for any cause in the Regional Legislative Assembly (then called the
Sangguniang Pampook).[34]
Executive is not bound by the principle of judicial courtesy
The petitioners in G.R. No. 197280, in their Manifestation and Motion dated
December 21, 2011, question the propriety of the appointment by the
President of Mujiv Hataman as acting Governor and Bainon Karon as acting
Vice Governor of the ARMM. They argue that since our previous decision
was based on a close vote of 8-7, and given the numerous motions for
reconsideration filed by the parties, the President, in recognition of the
principle of judicial courtesy, should have refrained from implementing our
decision until we have ruled with finality on this case.
We find the petitioners reasoning specious.
Firstly, the principle of judicial courtesy is based on the hierarchy of courts
and applies only to lower courts in instances where, even if there is no writ of
preliminary injunction or TRO issued by a higher court, it would be proper for
a lower court to suspend its proceedings for practical and ethical
considerations.[35] In other words, the principle of judicial courtesy applies
where there is a strong probability that the issues before the higher court
would be rendered moot and moribund as a result of the continuation of the
proceedings in the lower court or court of origin.[36] Consequently, this
principle cannot be applied to the President, who represents a co-equal
branch of government. To suggest otherwise would be to disregard the

principle of separation of powers, on which our whole system of government

is founded upon.
Secondly, the fact that our previous decision was based on a slim vote of 8-7
does not, and cannot, have the effect of making our ruling any less effective
or binding. Regardless of how close the voting is, so long as there is
concurrence of the majority of the members of the en banc who actually took
part in the deliberations of the case,[37] a decision garnering only 8 votes out
of 15 members is still a decision of the Supreme Court en banc and must be
respected as such. The petitioners are, therefore, not in any position to
speculate that, based on the voting, the probability exists that their motion
for reconsideration may be granted.[38]
Similarly, the petitioner in G.R. No. 197282, in his Very Urgent Motion to
Issue Clarificatory Resolution, argues that since motions for reconsideration
were filed by the aggrieved parties challenging our October 18, 2011
decision in the present case, the TRO we initially issued on September 13,
2011 should remain subsisting and effective. He further argues that any
attempt by the Executive to implement our October 18, 2011 decision
pending resolution of the motions for reconsideration borders on disrespect
if not outright insolence[39] to this Court.
In support of this theory, the petitioner cites Samad v. COMELEC,[40] where
the Court held that while it had already issued a decision lifting the TRO, the
lifting of the TRO is not yet final and executory, and can also be the subject
of a motion for reconsideration. The petitioner also cites the minute resolution
issued by the Court in Tolentino v. Secretary of Finance,[41] where the
Court reproached the Commissioner of the Bureau of Internal Revenue for
manifesting its intention to implement the decision of the Court, noting that
the Court had not yet lifted the TRO previously issued.[42]
We agree with the petitioner that the lifting of a TRO can be included as a
subject of a motion for reconsideration filed to assail our decision. It does not
follow, however, that the TRO remains effective until after we have issued a
final and executory decision, especially considering the clear wording of the
dispositive portion of our October 18, 2011 decision, which states:

dismissed by the Court, an examination of the dispositive portion of the

decision in Tolentino reveals that the Court did not categorically lift the TRO.
In sharp contrast, in the present case, we expressly lifted the TRO issued on
September 13, 2011. There is, therefore, no legal impediment to prevent the
President from exercising his authority to appoint an acting ARMM Governor
and Vice Governor as specifically provided for in RA No. 10153.
Conclusion
As a final point, we wish to address the bleak picture that the petitioner in
G.R. No. 197282 presents in his motion, that our Decision has virtually given
the President the power and authority to appoint 672,416 OICs in the event
that the elections of barangay and Sangguniang Kabataan officials are
postponed or cancelled.
We find this speculation nothing short of fear-mongering.
This argument fails to take into consideration the unique factual and legal
circumstances which led to the enactment of RA No. 10153. RA No. 10153
was passed in order to synchronize the ARMM elections with the national
and local elections. In the course of synchronizing the ARMM elections with
the national and local elections, Congress had to grant the President the
power to appoint OICs in the ARMM, in light of the fact that: (a) holdover by
the incumbent ARMM elective officials is legally impermissible; and (b)
Congress cannot call for special elections and shorten the terms of elective
local officials for less than three years.
Unlike local officials, as the Constitution does not prescribe a term limit for
barangay and Sangguniang Kabataan officials, there is no legal proscription
which prevents these specific government officials from continuing in a
holdover capacity should some exigency require the postponement of
barangay or Sangguniang Kabataan elections. Clearly, these fears have
neither legal nor factual basis to stand on.
For the foregoing reasons,
reconsideration.cralaw

we deny the petitioners motions

for

WHEREFORE, premises considered, we DISMISS the consolidated petitions

assailing the validity of RA No. 10153 for lack of merit, and UPHOLD the
constitutionality of this law. We likewise LIFT the temporary restraining order
we issued in our Resolution of September 13, 2011. No costs.[43]
(emphases ours)

WHEREFORE, premises considered, we DENY with FINALITY the motions

for reconsideration for lack of merit and UPHOLD the constitutionality of RA
No. 10153.

In this regard, we note an important distinction between Tolentino and the

present case. While it may be true that Tolentino and the present case are
similar in that, in both cases, the petitions assailing the challenged laws were

Peralta, Bersamin, Villarama, Jr., Mendoza, Reyes, and Perlas-Bernabe,

JJ., concur.
Corona, C.J., no part.

SO ORDERED.

Carpio, J., I reiterate my dissenting opinion.

Velasco, Jr., J., I reiterate my dissenting opinion.
Leonardo-De Castro, J., maintain my vote in joining the dissent of J. Velasco.
Del Castillo, J., sent his vote concurring with J. Brion. (on official leave).
Abad, J., I maintain my dissent.
Perez, J., I join the dissent of J. Carpio.
Sereno, J., on leave.

[G.R. No. 93054 : December 4, 1990.]

192 SCRA 100
Cordillera Regional Assembly Member ALEXANDER P. ORDILLO,
(Banaue), Ifugao Provincial Board Member CORAZON MONTINIG,
(Mayoyao), Former Vice-Mayor MARTIN UDAN (Banaue), Municipal
Councilors MARTIN GANO, (Lagawe), and TEODORO HEWE, (Hingyon),
Barangay Councilman PEDRO W. DULAG (Lamut); Aguinaldo residents
SANDY B. CHANGIWAN, and DONATO TIMAGO; Lamut resident REY
ANTONIO; Kiangan residents ORLANDO PUGUON, and REYNAND
DULDULAO; Lagawe residents TOMAS KIMAYONG, GREGORIO
DANGO, GEORGE B. BAYWONG, and VICENTE LUNAG; Hingyon
residents PABLO M. DULNUAN and CONSTANCIO GANO; Mayoyao
residents PEDRO M. BAOANG, LEONARDO IGADNA, and MAXIMO
IGADNA; and Banaue residents PUMA-A CULHI, LATAYON BUTTIG,
MIGUEL PUMELBAN, ANDRES ORDILLO, FEDERICO MARIANO,
SANDY BINOMNGA, GABRIEL LIMMANG, ROMEO TONGALI, RUBEN
BAHATAN, MHOMDY GABRIEL, and NADRES GHAMANG, Petitioners,
vs. THE COMMISSION ON ELECTIONS; The Honorable FRANKLIN M.
DRILON, Secretary of Justice; Hon. CATALINO MACARAIG, Executive
Secretary; The Cabinet Officer for Regional Development; Hon.
GUILLERMO CARAGUE, Secretary of Budget and Management; and
Hon. ROSALINA S. CAJUCOM, OIC, National Treasurer, Respondents.
DECISION
GUTIERREZ, JR., J.:
The question raised in this petition is whether or not the province of Ifugao,
being the only province which voted favorably for the creation of the
Cordillera Autonomous Region can, alone, legally and validly constitute such
Region.
The antecedent facts that gave rise to this petition are as follows:
On January 30, 1990, the people of the provinces of Benguet, Mountain
Province, Ifugao, Abra and Kalinga-Apayao and the city of Baguio cast their
votes in a plebiscite held pursuant to Republic Act No. 6766 entitled "An Act
Providing for an Organic Act for the Cordillera Autonomous Region."
The official Commission on Elections (COMELEC) results of the plebiscite
showed that the creation of the Region was approved by a majority of 5,889
votes in only the Ifugao Province and was overwhelmingly rejected by
148,676 votes in the rest of the provinces and city above-mentioned.

Consequently, the COMELEC, on February 14, 1990, issued Resolution No.

2259 stating that the Organic Act for the Region has been approved and/or
ratified by majority of the votes cast only in the province of Ifugao. On the
same date, the Secretary of Justice issued a memorandum for the President
reiterating the COMELEC resolution and provided:
". . . [A]nd considering the proviso in Sec. 13(A) that only the provinces and
city voting favorably shall be included in the CAR, the province of Ifugao
being the only province which voted favorably then, alone, legally and
validly constitutes the CAR." (Rollo, p. 7)
As a result of this, on March 8, 1990, Congress enacted Republic Act No.
6861 setting the elections in the Cordillera Autonomous Region of Ifugao on
the first Monday of March 1991.: nad
Even before the issuance of the COMELEC resolution, the Executive
Secretary on February 5, 1990 issued a Memorandum granting authority to
wind up the affairs of the Cordillera Executive Board and the Cordillera
Regional Assembly created under Executive Order No. 220.
On March 9, 1990, the petitioner filed a petition with COMELEC to declare
the non-ratification of the Organic Act for the Region. The COMELEC merely
noted said petition.
On March 30, 1990, the President issued Administrative Order No. 160
declaring among others that the Cordillera Executive Board and Cordillera
Regional Assembly and all the offices created under Executive Order No.
220 were abolished in view of the ratification of the Organic Act.- nad
The petitioners maintain that there can be no valid Cordillera Autonomous
Region in only one province as the Constitution and Republic Act No. 6766
require that the said Region be composed of more than one constituent unit.
The petitioners, then, pray that the Court: (1) declare null and void
COMELEC resolution No. 2259, the memorandum of the Secretary of
Justice, the memorandum of the Executive Secretary, Administrative Order
No. 160, and Republic Act No. 6861 and prohibit and restrain the
respondents from implementing the same and spending public funds for the
purpose and (2) declare Executive Order No. 220 constituting the Cordillera
Executive Board and the Cordillera Regional Assembly and other offices to
be still in force and effect until another organic law for the Autonomous
Region shall have been enacted by Congress and the same is duly ratified
by the voters in the constituent units. We treat the Comments of the
respondents as an answer and decide the case.
This petition is meritorious.

The sole province of Ifugao cannot validly constitute the Cordillera

Autonomous Region.
It is explicit in Article X, Section 15 of the 1987 Constitution that:
"Section 15. There shall be created autonomous regions in Muslim Mindanao
and in the Cordillera consisting of provinces, cities, municipalities and
geographical areas sharing common and distinctive historical and cultural
heritage, economic and social structures, and other relevant characteristics
within the framework of this Constitution and the national sovereignty as well
as territorial integrity of the Republic of the Philippines." (Emphasis Supplied)
The keywords provinces, cities, municipalities and geographical areas
connote that "region" is to be made up of more than one constituent unit. The
term "region" used in its ordinary sense means two or more provinces. This
is supported by the fact that the thirteen (13) regions into which the
Philippines is divided for administrative purposes are groupings of contiguous
provinces. (Integrated Reorganization Plan (1972), which was made as part
of the law of the land by P.D. No. 1; P.D. No. 742) Ifugao is a province by
itself. To become part of a region, it must join other provinces, cities,
municipalities, and geographical areas. It joins other units because of their
common and distinctive historical and cultural heritage, economic and social
structures and other relevant characteristics. The Constitutional requirements
are not present in this case.- nad
The well-established rule in statutory construction that the language of the
Constitution, as much as possible should be understood in the sense it has in
common use and that the words used in constitutional provisions are to be
given their ordinary meaning except where technical terms are employed,
must then, be applied in this case. (See Baranda v. Gustilo, 165 SCRA 757,
770, [1988]; J.M. Tuason & Co., Inc. v. Land Tenure Administration, 31
SCRA 413, 422-423 [1970]).
Aside from the 1987 Constitution, a reading of the provisions of Republic Act
No. 6766 strengthens the petitioner's position that the Region cannot be
constituted from only one province.
Article III, Sections 1 and 2 of the Statute provide that the Cordillera
Autonomous Region is to be administered by the Cordillera government
consisting of the Regional Government and local government units. It further
provides that:
"SECTION 2. The Regional Government shall exercise powers and functions
necessary for the proper governance and development of all provinces,
cities, municipalities, and barangay or ili within the Autonomous Region . . ."

From these sections, it can be gleaned that Congress never intended that a
single province may constitute the autonomous region. Otherwise, we would
be faced with the absurd situation of having two sets of officials, a set of
provincial officials and another set of regional officials exercising their
executive and legislative powers over exactly the same small area.
Article V, Sections 1 and 4 of Republic Act 6766 vest the legislative power in
the Cordillera Assembly whose members shall be elected from regional
assembly districts apportioned among provinces and the cities composing
the Autonomous Region. chanrobles virtual law library
If we follow the respondent's position, the members of such Cordillera
Assembly shall then be elected only from the province of Ifugao creating an
awkward predicament of having two legislative bodies the Cordillera
Assembly and the Sangguniang Panlalawigan exercising their legislative
powers over the province of Ifugao. And since Ifugao is one of the smallest
provinces in the Philippines, population-wise, it would have too many
government officials for so few people.:-cralaw
Article XII, Section 10 of the law creates a Regional Planning and
Development Board composed of the Cordillera Governor, all the provincial
governors and city mayors or their representatives, two members of the
Cordillera Assembly, and members representing the private sector. The
Board has a counterpart in the provincial level called the Provincial Planning
and Development Coordinator. The Board's functions (Article XII, Section 10,
par. 2, Republic Act No. 6766) are almost similar to those of the Provincial
Coordinator's (Title Four, Chapter 3, Article 10, Section 220 (4), Batas
Pambansa Blg. 337 Local Government Code). If it takes only one person
in the provincial level to perform such functions while on the other hand it
takes an entire Board to perform almost the same tasks in the regional level,
it could only mean that a larger area must be covered at the regional level.
The respondent's theory of the Autonomous Region being made up of a
single province must, therefore, fail.
Article XXI, Section 13 (B) (c) alloting the huge amount of Ten Million Pesos
(P10,000,000.00) to the Regional Government for its initial organizational
requirements cannot be construed as funding only a lone and small province.
These sections of Republic Act No. 6766 show that a one province Cordillera
Autonomous Region was never contemplated by the law creating it.
The province of Ifugao makes up only 11% of the total population of the
areas enumerated in Article I, Section 2 (b) of Republic Act No. 6766 which
include Benguet, Mountain Province, Abra, Kalinga-Apayao and Baguio City.
It has the second smallest number of inhabitants from among the provinces

and city above mentioned. The Cordillera population is distributed in round

figures as follows: Abra, 185,000; Benguet, 486,000; Ifugao, 149,000;
Kalinga-Apayao, 214,000; Mountain Province, 116,000; and Baguio City,
183,000; Total population of these five provinces and one city; 1,332,000
according to the 1990 Census (Manila Standard, September 30, 1990, p. 14).
There are other provisions of Republic Act No. 6766 which are either violated
or which cannot be complied with. Section 16 of Article V calls for a Regional
Commission on Appointments with the Speaker as Chairman and are (6)
members coming from different provinces and cities in the Region. Under the
respondents' view, the Commission would have a Chairman and only one
member. It would never have a quorum. Section 3 of Article VI calls for
cabinet members, as far as practicable, to come from various provinces and
cities of the Region. Section 1 of Article VII creates a system of tribal courts
for the various indigenous cultural communities of the Region. Section 9 of
Article XV requires the development of a common regional language based
upon the various languages and dialects in the region which regional
language in turn is expected to enrich the national language.
The entirety of Republic Act No. 6766 creating the Cordillera Autonomous
Region is infused with provisions which rule against the sole province of
Ifugao constituting the Region.:-cralaw
To contemplate the situation envisioned by the respondent would not only
violate the letter and intent of the Constitution and Republic Act No. 6766 but
would also be impractical and illogical.
Our decision in Abbas, et al. v. COMELEC, (G.R. No. 89651, November 10,
1969), is not applicable in the case at bar contrary to the view of the
Secretary of Justice.
The Abbas case laid down the rate on the meaning of majority in the phrase
"by majority of the votes cast by the constituent units called for the purpose"
found in the Constitution, Article X, Section 18. It stated:
x x x
". . . [I]t is thus clear that what is required by the Constitution is simple
majority of votes approving the Organic Act in individual constituent units and
not a double majority of the votes in all constituent units put together, as well
as in the individual constituent units."
This was the pronouncement applied by the Secretary of Justice in arriving at
his conclusion stated in his Memorandum for the President that:

". . . [i]t is believed that the creation of the Cordillera Autonomous Region
(CAR) as mandated by R.A. No. 6766 became effective upon its approval by
the majority of the votes cast in the province of Ifugao. And considering the
proviso in Section 13 (a) that only the provinces and city voting favorably
shall be included in the CAR, the province of Ifugao being the only province
which voted favorably can, alone, legally and validly constitute the CAR."
(Rollo. p. 40).
The plebiscites mandated by the Constitution and Republic Act No. 6766 for
the Cordillera and Republic Act No. 6734 for the Autonomous Region in
Muslim Mindanao determine (1) whether there shall be an autonomous
region in the Cordillera and in Muslim Mindanao and (2) which provinces and
cities, among those enumerated in the two Republic Acts, shall comprise
said Autonomous Regions. (See III, Record of the Constitutional
Commission, 487-492 [1986]).
The Abbas case established the rule to follow on which provinces and cities
shall comprise the autonomous region in Muslim Mindanao which is,
consequently, the same rule to follow with regard to the autonomous region
in the Cordillera. However, there is nothing in the Abbas decision which deals
with the issue on whether an autonomous region, in either Muslim Mindanao
or Cordillera could exist despite the fact that only one province or one city is
to constitute it.chanrobles virtual law library
Stated in another way, the issue in this case is whether the sole province of
Ifugao can validly and legally constitute the Cordillera Autonomous Region.
The issue is not whether the province of Ifugao is to be included in the
Cordillera Autonomous Region. It is the first issue which the Court answers in
the instant case.
WHEREFORE, the petition is hereby GRANTED. Resolution No. 2259 of the
Commission on Elections, insofar as it upholds the creation of an
autonomous region, the February 14, 1990 memorandum of the Secretary of
Justice, the February 5, 1990 memorandum of the Executive Secretary,
Administrative Order No. 160, and Republic Act No. 6861 are declared null
and void while Executive Order No. 220 is declared to be still in force and
effect until properly repealed or amended.
SO ORDERED.
Fernan C.J., Narvasa, Melencio-Herrera, Cruz, Paras, Gancayco, Padilla,
Bidin, Sarmiento, Grio-Aquino, Medialdea and Regalado, JJ., concur.
Feliciano, J., is on leave.

x x x

G.R. No. 79956 January 29, 1990

CORDILLERA BROAD COALITION, petitioner,
vs.
COMMISSION ON AUDIT, respondent.
G.R. No. 82217 January 29, 1990
LILIA YARANON and BONA BAUTISTA, assisted by their spouses,
BRAULIO D. YARANON and DEMETRIO D. BAUTISTA, JR., respectively;
JAMES BRETT and SINAI C. HAMADA, petitioners,
vs.
THE COMMISSION ON AUDIT, HON. CATALINO MACARAIG, Executive
Secretary, HON. VICENTE JAYME, Secretary of Finance, HON.
GUILLERMO N. CARAGUE, Secretary of Budget and Management, and
HON. ROSALINA S. CAJUCOM, OIC National Treasurer, respondents.
CORTES, J.:

commission composed of representatives appointed by the President from a

list of nominees from multi-sectoral bodies. The organic act shall define the
basic structure of government for the region consisting of the executive
department and legislative assembly, both of which shall be elective and
representative of the constituent political units. The organic acts shall
likewise provide for special courts with personal, family and property law
jurisdiction consistent with the provisions of this Constitution and national
laws.
The creation of the autonomous region shall be effective when approved by
majority of the votes cast by the constituent units in a plebiscite called for the
purpose, provided that only provinces, cities, and geographic areas voting
favorably in such plebiscite shall be included in the autonomous region.
Sec. 19. The first Congress elected under this Constitution shall, within
eighteen months from the time of organization of both Houses, pass the
organic acts for the autonomous regions in Muslim Mindanao and the
Cordilleras.

In these consolidated petitions, the constitutionality of Executive Order No.

220, dated July 15, 1987, which created the (Cordillera Administrative
Region, is assailed on the primary ground that it pre-empts the enactment of
an organic act by the Congress and the creation of' the autonomous region in
the Cordilleras conditional on the approval of the act through a plebiscite.

Sec. 20. Within its territorial jurisdiction and subject to the provisions of this
Constitution and national laws, the organic act of autonomous regions shall
provide for legislative powers over:
(1)

Administrative organization;

Relative to the creation of autonomous regions, the constitution, in Article X,

provides:

(2)

Creation of sources of revenues;

(3)

Ancestral domain and natural resources;

(4)

Personal, family and property relations;

(5)

Regional urban and rural planning development;

(6)

Economic, social and tourism development ;

(7)

Educational policies;

(8)

Preservation and development of the cultural heritage; and

AUTONOMOUS REGIONS
Sec. 15. There shall be created autonomous regions in Muslim Mindanao
and in the Cordilleras consisting of provinces, cities, municipalities, and
geographical areas sharing common and distinctive historical and cultural
heritage, economic and social structures, and other relevant characteristics
within the framework of this Constitution and the national sovereignty as well
as territorial integrity of the Republic of the Philippines.
SEC. 16. The President shall exercise general supervision over autonomous
regions to ensure that laws are faithfully executed.
Sec. 17. All powers, functions, and responsibilities not granted Constitution
or by law to the autonomous regions shall be vested in the National
Government.
Sec. 18. The Congress shall enact an organic act for each autonomous
region with the assistance and participation of the regional consultative

(9)
Such other matters as may be authorized by law for the promotion of
the general welfare of the people of the region.
Sec. 21. The preservation of peace and order within the regions shall be the
responsibility of the local police agencies which shall be organized,
maintained, supervised, and utilized in accordance with applicable laws. The

defense and security of the regions shall be the responsibility of the National
Government.
A study of E.O. No. 220 would be incomplete Without reference to its
historical background.
In April 1986, just after the EDSA Revolution, Fr. Conrado M. Balweg,
S.V.D., broke off on ideological grounds from the Communist Party of the
Philippines (CPP) and its military arm the New People's Army. (NPA).
After President Aquino was installed into office by People Power, she
advocated a policy of national reconciliation. She called on all revolutionary
forces to a peace dialogue. The CPLA heeded this call of the President. After
the preliminary negotiations, President Aquino and some members of her
Cabinet flew to Mt. Data in the Mountain Province on September 13, 1986
and signed with Fr. Conrado M. Balweg (As Commander of the CPLA and
Ama Mario Yag-ao (as President of Cordillera Bodong Administration, the
civil government of the CPLA a ceasefire agreement that signified the
cessation of hostilities (WHEREAS No. 7, E.O. 220).
The parties arrived at an agreement in principle: the Cordillera people shall
not undertake their demands through armed and violent struggle but by
peaceful means, such as political negotiations. The negotiations shall be a
continuing process until the demands of the Cordillera people shall have
been substantially granted.
On March 27, 1987, Ambassador Pelaez [Acting as Chief Negotiator of the
government], in pursuance of the September 13, 1986 agreement, flew to the
Mansion House, Baguio City, and signed with Fr. Balweg (as Chairman of
the Cordillera panel) a joint agreement, paragraphs 2 and 3 of which state:
Par. 2- Work together in drafting an Executive Order to create a preparatory
body that could perform policy-making and administrative functions and
undertake consultations and studies leading to a draft organic act for the
Cordilleras.
Par. 3- Have representatives from the Cordillera panel join the study group
of the R.P. Panel in drafting the Executive Order.
Pursuant to the above joint agreement, E.O. 220 was drafted by a panel of
the Philippine government and of the representatives of the Cordillera
people.
On July 15, 1987, President Corazon C. Aquino signed the joint draft into
law, known now as E.O. 220. [Rejoinder G.R. No. 82217, pp. 2-3].

Executive Order No. 220, issued by the President in the exercise of her
legislative powers under Art. XVIII, sec. 6 of the 1987 Constitution, created
the Cordillera Administrative Region (CAR) , which covers the provinces of
Abra, Benguet, Ifugao, Kalinga-Apayao and Mountain Province and the City
of Baguio [secs. 1 and 2]. It was created to accelerate economic and social
growth in the region and to prepare for the establishment of the autonomous
region in the Cordilleras [sec. 3]. Its main function is to coordinate the
planning and implementation of programs and services in the region,
particularly, to coordinate with the local government units as well as with the
executive departments of the National Government in the supervision of field
offices and in identifying, planning, monitoring, and accepting projects and
activities in the region [sec. 5]. It shall also monitor the implementation of all
ongoing national and local government projects in the region [sec. 20]. The
CAR shall have a Cordillera Regional Assembly as a policy-formulating body
and a Cordillera Executive Board as an implementing arm [secs. 7, 8 and
10]. The CAR and the Assembly and Executive Board shall exist until such
time as the autonomous regional government is established and organized
[sec. 17].
Explaining the rationale for the issuance of E.O. No. 220, its last "Whereas"
clause provides:
WHEREAS, pending the convening of the first Congress and the enactment
of the organic act for a Cordillera autonomous region, there is an urgent
need, in the interest of national security and public order, for the President to
reorganize immediately the existing administrative structure in the Cordilleras
to suit it to the existing political realities therein and the Government's
legitimate concerns in the areas, without attempting to pre-empt the
constitutional duty of the first Congress to undertake the creation of an
autonomous region on a permanent basis.
During the pendency of this case, Republic Act No. 6766 entitled "An Act
Providing for an Organic Act for the Cordillera Autonomous Region," was
enacted and signed into law. The Act recognizes the CAR and the offices
and agencies created under E.O. No. 220 and its transitory nature is
reinforced in Art. XXI of R.A. No. 6766, to wit:
SEC. 3. The Cordillera Executive Board, the Cordillera Region Assembly as
well as all offices and agencies created under Execute Order No. 220 shall
cease to exist immediately upon the ratification of this Organic Act.
All funds, properties and assets of the Cordillera Executive Board and the
Cordillera Regional Assembly shall automatically be transferred to the
Cordillera Autonomous Government.
I

It is well-settled in our jurisprudence that respect for the inherent and stated
powers and prerogatives of the law-making body, as well as faithful
adherence to the principle of separation of powers, require that its enactment
be accorded the presumption of constitutionality. Thus, in any challenge to
the constitutionality of a statute, the burden of clearly and unequivocally
proving its unconstitutionality always rests upon the challenger. Conversely,
failure to so prove will necessarily defeat the challenge.
We shall be guided by these principles in considering these consolidated
petitions.
In these cases, petitioners principally argue that by issuing E.O. No. 220 the
President, in the exercise of her legislative powers prior to the convening of
the first Congress under the 1987 Constitution, has virtually pre-empted
Congress from its mandated task of enacting an organic act and created an
autonomous region in the Cordilleras. We have carefully studied the
Constitution and E.O. No. 220 and we have come to the conclusion that
petitioners' assertions are unfounded. Events subsequent to the issuance of
E.O. No. 220 also bear out this conclusion.
1.
A reading of E.O. No. 220 will easily reveal that what it actually
envisions is the consolidation and coordination of the delivery of services of
line departments and agencies of the National Government in the areas
covered by the administrative region as a step preparatory to the grant of
autonomy to the Cordilleras. It does not create the autonomous region
contemplated in the Constitution. It merely provides for transitory measures
in anticipation of the enactment of an organic act and the creation of an
autonomous region. In short, it prepares the ground for autonomy. This does
not necessarily conflict with the provisions of the Constitution on autonomous
regions, as we shall show later.
The Constitution outlines a complex procedure for the creation of an
autonomous region in the Cordilleras. A regional consultative commission
shall first be created. The President shall then appoint the members of a
regional consultative commission from a list of nominees from multi-sectoral
bodies. The commission shall assist the Congress in preparing the organic
act for the autonomous region. The organic act shall be passed by the first
Congress under the 1987 Constitution within eighteen months from the time
of its organization and enacted into law. Thereafter there shall be held a
plebiscite for the approval of the organic act [Art. X, sec. 18]. Only then, after
its approval in the plebiscite, shall the autonomous region be created.
Undoubtedly, all of these will take time. The President, in 1987 still exercising
legislative powers, as the first Congress had not yet convened, saw it fit to
provide for some measures to address the urgent needs of the Cordilleras in

the meantime that the organic act had not yet been passed and the
autonomous region created. These measures we find in E.O. No. 220. The
steps taken by the President are obviously perceived by petitioners,
particularly petitioner Yaranon who views E.O. No. 220 as capitulation to the
Cordillera People's Liberation Army (CPLA) of Balweg, as unsound, but the
Court cannot inquire into the wisdom of the measures taken by the President,
We can only inquire into whether or not the measures violate the
Constitution. But as we have seen earlier, they do not.
2.
Moreover, the transitory nature of the CAR does not necessarily
mean that it is, as petitioner Cordillera Broad Coalition asserts, "the interim
autonomous region in the Cordilleras" [Petition, G.R. No. 79956, p. 25].
The Constitution provides for a basic structure of government in the
autonomous region composed of an elective executive and legislature and
special courts with personal, family and property law jurisdiction [Art. X, sec.
18]. Using this as a guide, we find that E.O. No. 220 did not establish an
autonomous regional government. It created a region, covering a specified
area, for administrative purposes with the main objective of coordinating the
planning and implementation of programs and services [secs. 2 and 5]. To
determine policy, it created a representative assembly, to convene yearly
only for a five-day regular session, tasked with, among others, identifying
priority projects and development programs [sec. 9]. To serve as an
implementing body, it created the Cordillera Executive Board composed of
the Mayor of Baguio City, provincial governors and representatives of the
Cordillera Bodong Administration, ethno-linguistic groups and nongovernmental organizations as regular members and all regional directors of
the line departments of the National Government as ex-officio members and
headed by an Executive Director [secs. 10 and 11]. The bodies created by
E.O. No. 220 do not supplant the existing local governmental structure, nor
are they autonomous government agencies. They merely constitute the
mechanism for an "umbrella" that brings together the existing local
governments, the agencies of the National Government, the ethno-linguistic
groups or tribes, and non-governmental organizations in a concerted effort to
spur development in the Cordilleras.
The creation of the CAR for purposes of administrative coordination is
underscored by the mandate of E.O. No. 220 for the President and
appropriate national departments and agencies to make available sources of
funds for priority development programs and projects recommended by the
CAR [sec. 21] and the power given to the President to call upon the
appropriate executive departments and agencies of the National Government
to assist the CAR [sec. 24].
3. Subsequent to the issuance of E.O. No. 220, the Congress, after it was
convened, enacted Republic Act No. 6658 which created the Cordillera

Regional Consultative Commission. The President then appointed its

members. The commission prepared a draft organic act which became the
basis for the deliberations of the Senate and the House of Representatives.
The result was Republic Act No. 6766, the organic act for the Cordillera
autonomous region, which was signed into law on October 23, 1989. A
plebiscite for the approval of the organic act, to be conducted shortly, shall
complete the process outlined in the Constitution.
In the meantime, E.O. No. 220 had been in force and effect for more than
two years and we find that, despite E.O. No. 220, the autonomous region in
the Cordilleras is still to be created, showing the lack of basis of petitioners'
assertion. Events have shown that petitioners' fear that E.O. No. 220 was a
"shortcut" for the creation of the autonomous region in the Cordilleras was
totally unfounded.
Clearly, petitioners' principal challenge has failed.
II
A collateral issue raised by petitioners is the nature of the CAR: whether or
not it is a territorial and political subdivision. The Constitution provides in
Article X:
Section 1. The territorial and political subdivisions of the Republic of the
Philippines are the provinces, cities, municipalities, and barangays. There
shall be autonomous regions in Muslim Mindanao and the Cordilleras as
hereinafter provided.
xxx

xxx

xxx

Sec. 10. No province, city, municipality, or barangay may be created, divided,

merged, abolished, or its boundary substantially altered, except in
accordance with the criteria established in the local government code and
subject to approval by a majority of the votes cast in a plebiscite in the
political units directly affected.
We have seen earlier that the CAR is not the autonomous region in the
Cordilleras contemplated by the Constitution, Thus, we now address
petitioners' assertion that E. 0. No. 220 contravenes the Constitution by
creating a new territorial and political subdivision.
After carefully considering the provisions of E.O. No. 220, we find that it did
not create a new territorial and political subdivision or merge existing ones
into a larger subdivision.

1.
Firstly, the CAR is not a public corporation or a territorial and political
subdivision. It does not have a separate juridical personality, unlike
provinces, cities and municipalities. Neither is it vested with the powers that
are normally granted to public corporations, e.g. the power to sue and be
sued, the power to own and dispose of property, the power to create its own
sources of revenue, etc. As stated earlier, the CAR was created primarily to
coordinate the planning and implementation of programs and services in the
covered areas.
The creation of administrative regions for the purpose of expediting the
delivery of services is nothing new. The Integrated Reorganization Plan of
1972, which was made as part of the law of the land by virtue of Presidential
Decree No. 1, established eleven (11) regions, later increased to twelve (12),
with definite regional centers and required departments and agencies of the
Executive Branch of the National Government to set up field offices therein.
The functions of the regional offices to be established pursuant to the
Reorganization Plan are: (1) to implement laws, policies, plans, programs,
rules and regulations of the department or agency in the regional areas; (2)
to provide economical, efficient and effective service to the people in the
area; (3) to coordinate with regional offices of other departments, bureaus
and agencies in the area; (4) to coordinate with local government units in the
area; and (5) to perform such other functions as may be provided by law.
[See Part II, chap. III, art. 1, of the Reorganization Plan].
We can readily see that the CAR is in the same genre as the administrative
regions created under the Reorganization Plan, albeit under E.O. No. 220 the
operation of the CAR requires the participation not only of the line
departments and agencies of the National Government but also the local
governments, ethno-linguistic groups and non-governmental organizations in
bringing about the desired objectives and the appropriation of funds solely for
that purpose.
2. Then, considering the control and supervision exercised by the President
over the CAR and the offices created under E.O. No. 220, and considering
further the indispensable participation of the line departments of the National
Government, the CAR may be considered more than anything else as a
regional coordinating agency of the National Government, similar to the
regional development councils which the President may create under the
Constitution [Art. X, sec. 14]. These councils are "composed of local
government officials, regional heads of departments and other government
offices, and representatives from non-governmental organizations within the
region for purposes of administrative decentralization to strengthen the
autonomy of the units therein and to accelerate the economic and social
growth and development of the units in the region." [Ibid.] In this wise, the
CAR may be considered as a more sophisticated version of the regional
development council.

III
Finally, petitioners incidentally argue that the creation of the CAR
contravened the constitutional guarantee of the local autonomy for the
provinces (Abra, Benguet, Ifugao, Kalinga-Apayao and Mountain Province)
and city (Baguio City) which compose the CAR.
We find first a need to clear up petitioners' apparent misconception of the
concept of local autonomy.
It must be clarified that the constitutional guarantee of local autonomy in the
Constitution [Art. X, sec. 2] refers to the administrative autonomy of local
government units or, cast in more technical language, the decentralization of
government authority [Villegas v. Subido, G.R. No. L-31004, January 8,
1971, 37 SCRA 1]. Local autonomy is not unique to the 1987 Constitution, it
being guaranteed also under the 1973 Constitution [Art. II, sec. 10]. And
while there was no express guarantee under the 1935 Constitution, the
Congress enacted the Local Autonomy Act (R.A. No. 2264) and the
Decentralization Act (R.A. No. 5185), which ushered the irreversible march
towards further enlargement of local autonomy in the country [Villegas v.
Subido, supra.]
On the other hand, the creation of autonomous regions in Muslim Mindanao
and the Cordilleras, which is peculiar to the 1987 Constitution contemplates
the grant of political autonomy and not just administrative autonomy these
regions. Thus, the provision in the Constitution for an autonomous regional
government with a basic structure consisting of an executive department and
a legislative assembly and special courts with personal, family and property
law jurisdiction in each of the autonomous regions [Art. X, sec. 18].
As we have said earlier, the CAR is a mere transitory coordinating agency
that would prepare the stage for political autonomy for the Cordilleras. It fills
in the resulting gap in the process of transforming a group of adjacent
territorial and political subdivisions already enjoying local or administrative
autonomy into an autonomous region vested with political autonomy.
Anent petitioners' objection, we note the obvious failure to show how the
creation of the CAR has actually diminished the local autonomy of the
covered provinces and city. It cannot be over-emphasized that pure
speculation and a resort to probabilities are insufficient to cause the
invalidation of E.O. No. 220.
WHEREFORE, the petitions are DISMISSED for lack of merit.
SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco,

Padilla, Bidin, Sarmiento, Grio-Aquino, Medialdea and Regalado, JJ.,
concur.

[G.R. No. 118303. January 31, 1996.]

SENATOR HEHERSON T. ALVAREZ, SENATOR JOSE D. LINA, JR., MR.
NICASIO B. BAUTISTA, MR. JESUS P. GONZAGA, MR. SOLOMON D.
MAYLEM, LEONORA C. MEDINA, CASIANO S. ALIPON, Petitioners, v.
HON. TEOFISTO T. GUINGONA, JR., in his capacity as Executive
Secretary, HON. RAFAEL ALUNAN, in his capacity as Secretary of
Local Government, HON. SALVADOR ENRIQUEZ, in his capacity as
Secretary of Budget, THE COMMISSION ON AUDIT, HON. JOSE
MIRANDA, in his capacity as Municipal Mayor of Santiago and HON.
CHARITO MANUBAY, HON. VICTORINO MIRANDA, JR., HON. ARTEMIO
ALVAREZ, HON. DANILO VERGARA, HON. PETER DE JESUS, HON.
NELIA NATIVIDAD, HON. CELSO CALEON and HON. ABEL MUSNGI, in
their capacity as SANGGUNIANG BAYAN MEMBERS, MR. RODRIGO L.
SANTOS, in his capacity as Municipal Treasurer, and ATTY. ALFREDO
S. DIRIGE, in his capacity as Municipal Administrator, Respondents.
Belo, Gozon, Elma, Parel, Asuncion & Lucila, for Petitioners.
Rene P. Pine, for Private Respondents.
1.
ADMINISTRATIVE LAW; LOCAL GOVERNMENT CODE; LOCAL
GOVERNMENT, CONSTRUED. A local Government Unit is a political
subdivision of the State which is constituted by law and possessed of
substantial control over its own affairs. Remaining to be an intra sovereign
subdivision of one sovereign nation, but not intended, however, to be an
emperium in emperia, the local government unit is autonomous in the sense
that it is given more powers, authority, responsibilities and resources.
2.
ID.; ID.; INCOME DEFINED. Income is defined in the Local
Government Code to be all revenues and receipts collected or received
forming the gross accretions of funds of the local government unit.
3.
ID.; ID.; INTERNAL REVENUE ALLOTMENT (IRA) ARE ITEMS OF
INCOME. The IRAs are items of income because they form part of the
gross accretion of the funds of the local government unit. The IRAs regularly
and automatically accrue to the local treasury without need of any further
action on the part of the local government unit. They thus constitute income
which the local government can invariably rely upon as the source of much
needed funds.
4.
ID.; ID.; ANNUAL INCOME DEFINED. Department of Finance
Order No. 35-93 correctly encapsulizes the full import of the above
disquisition when it defined ANNUAL INCOME to be "revenues and receipts
realized by provinces, cities and municipalities from regular sources of the
Local General Fund including the internal revenue allotment and other

shares provided for in Sections 284, 290 and 291 of the Code, but exclusive
of n.on.-recurring receipts, such as other national aids, grants, financial
assistance, loan proceeds, sales of fixed assets, and similar others"
(Emphasis ours).
5.
STATUTORY
CONSTRUCTION;
ORDER
CONSTITUTING
EXECUTIVE OR CONTEMPORANEOUS CONSTRUCTION OF A
STATUTE BY ADMINISTRATIVE AGENCY CHARGED WITH THE TASK
OF INTERPRETING THE SAME, ENTITLED TO FULL RESPECT. Such
order, constituting executive or contemporaneous construction of a statute by
an administrative agency charged with the task of interpreting and applying
the same, is entitled to full respect and should be accorded great weight by
the courts, unless such construction is clearly shown to be in sharp conflict
with the Constitution, the governing statute, or other laws.
6.
CONSTITUTIONAL LAW; LEGISLATIVE; BILL CONVERTING
MUNICIPALITY TO CITY MUST ORIGINATE FROM THE HOUSE;
PASSING OF SUBSEQUENT BILL COVERING THE SAME MUNICIPALITY,
NO ADVERSE EFFECT. Although a bill of local application like HB No.
8817 should, by constitutional prescription, originate exclusively in the House
of Representatives, the claim of petitioners that Republic Act No. 7720 did
not originate exclusively in the House of Representatives because a bill of
the same import, SB No. 1243, was passed in the Senate, is untenable
because it cannot be denied that HB No. 8817 was filed in the House of
Representatives first before SB No. 1243 was filed in the Senate. Petitioners
themselves cannot disavow their own admission that HB No. 8817 was filed
on April 18, 1993 while SB No. 1243 was filed on May 19, 1993. The filing of
HB No. 8817 was thus precursive not only of the said Act in question but also
of SB No. 1243. Thus, HB No. 8817, was the bill that initiated the legislative
process that culminated in the enactment of Republic Act No. 7720. No
violation of Section 24, Article VI, of the 1987 Constitution is perceptible
under the circumstances attending the instant controversy.
7.
ID.; ID.; FILING IN THE SENATE OF A SUBSTITUTE BILL IN
ANTICIPATION OF ITS RECEIPT OF THE HOUSE BILL WITHOUT
ACTING THEREON DOES NOT CONTRAVENE CONSTITUTIONAL
REQUIREMENT. Petitioners themselves acknowledge that HB No. 8817
was already approved on Third Reading and duly transmitted to the Senate
when the Senate Committee on Local Government conducted its public
hearing on HB No. 8817. HB No. 8817 was approved on the Third Reading
on December 17, 1993 and transmitted to the Senate on January 28, 1994; a
little less than a month thereafter, or on February 23, 1994, the Senate
Committee on Local Government conducted public hearings on SB No. 1243.
Clearly, the Senate held in abeyance any action on SB No. 1243 until it
received HB No. 8817, already approved on the Third Reading, from the
House of Representatives. The filing in the Senate of a substitute bill in

anticipation of its receipt of the bill from the House, does not contravene the
constitutional requirement that a bill of local application should originate in
the House of Representatives, for as long as the Senate does not act
thereupon until it receives the House bill.

Antonio Abaya as principal author. Other sponsors included Representatives

Ciriaco Alfelor, Rodolfo Albano, Santiago Respicio and Faustino Dy. The bill
was referred to the House Committee on Local Government and the House
Committee on Appropriations on May 5, 1993.chanroblesvirtuallawlibrary

8.
REMEDIAL LAW; EVIDENCE; PRESUMPTIONS; EVERY LAW IS
PRESUMED CONSTITUTIONAL; CONSTITUTIONALITY OF R.A. 7720
NOT OVERCOME IN CASE AT BAR. It is a well-entrenched
jurisprudential rule that on the side of every law lies the presumption of
constitutionality. Consequently, for RA No. 7720 to be nullified, it must be
shown that there is a clear and unequivocal breach of the Constitution, not
merely a doubtful and equivocal one; in other words, the grounds for nullity
must be clear and beyond reasonable doubt. Those who petition this court to
declare a law to be unconstitutional must clearly and fully establish the basis
that will justify such a declaration; otherwise, their petition must fail. Taking
into consideration the justification of our stand on the immediately preceding
ground raised by petitioners to challenge the constitutionality of RA No. 7720,
the Court stands on the holding that petitioners have failed to overcome the
presumption. The dismissal of this petition is, therefore, inevitable.

On May 19, 1993, June 1, 1993, November 28, 1993, and December 1,
1993, public hearings on HB No. 8817 were conducted by the House
Committee on Local Government. The committee submitted to the House a
favorable report, with amendments, on December 9, 1993.

DECISION
HERMOSISIMA. JR., J.:
Of main concern to the petitioners is whether Republic Act No. 7720, just
recently passed by Congress and signed by the President into law, is
constitutionally infirm.
Indeed, in this Petition for Prohibition with prayer for Temporary Restraining
Order and Preliminary Prohibitory Injunction, petitioners assail the validity of
Republic Act No. 7720, entitled, "An Act Converting the Municipality of
Santiago, Isabela into an Independent Component City to be known as the
City of Santiago," mainly because the Act allegedly did not originate
exclusively in the House of Representatives as mandated by Section 24,
Article VI of the 1987 Constitution.chanroblesvirtuallawlibrary
Also, petitioners claim that the Municipality of Santiago has not met the
minimum average annual income required under Section 450 of the Local
Government Code of 1991 in order to be converted into a component city.

On December 13, 1993, HB No. 8817 was passed by the House of

Representatives on Second Reading and was approved on Third Reading on
December 17, 1993. On January 28, 1994, HB No. 8817 was transmitted to
the Senate.
Meanwhile, a counterpart of HB No. 8817, Senate Bill No. 1243, entitled, "An
Act Converting the Municipality of Santiago into an Independent Component
City to be Known as the City of Santiago," was filed in the Senate. It was
introduced by Senator Vicente Sotto III, as principal sponsor, on May 19,
1993. This was just after the House of Representatives had conducted its
first public hearing on HB No. 8817.chanroblesvirtuallawlibrary
On February 23, 1994, or a little less than a month after HB No. 8817 was
transmitted to the Senate, the Senate Committee on Local Government
conducted public hearings on SB No. 1243. On March 1, 1994, the said
committee submitted Committee Report No. 378 on HB No. 8817, with the
recommendation that it be approved without amendment, taking into
consideration the reality that H.B. No. 8817 was on all fours with SB No.
1243. Senator Heherson T. Alvarez, one of the herein petitioners, indicated
his approval thereto by signing said report as member of the Committee on
Local Government.
On March 3, 1994, Committee Report No. 378 was passed by the Senate on
Second Reading and was approved on Third Reading on March 14, 1994.
On March 22, 1994, the House of Representatives, upon being apprised of
the action of the Senate, approved the amendments proposed by the Senate.

Undisputed is the following chronicle of the metamorphosis of House Bill No.

8817 into Republic Act No. 7720:chanrob1es virtual 1aw library

The enrolled bill, submitted to the President on April 12, 1994, was signed by
the Chief Executive on May 5, 1994 as Republic Act No. 7720. When a
plebiscite on the Act was held on July 13, 1994, a great majority of the
registered voters of Santiago voted in favor of the conversion of Santiago into
a city.chanroblesvirtuallawlibrary

On April 18, 1993, HB No. 8817, entitled "An Act Converting the Municipality
of Santiago into an Independent Component City to be known as the City of
Santiago," was filed in the House of Representatives with Representative

The question as to the validity of Republic Act No. 7720 hinges on the
following twin issues: (I) Whether or not the Internal Revenue Allotments
(IRAs) are to included in the computation of the average annual income of a

municipality for purposes of its conversion into an independent component

city, and (II) Whether or not, considering that the Senate passed SB No.
1243, its own version of HB No. 8817, Republic Act No. 7720 can be said to
have originated in the House of Representatives.
I.

The annual income of a local government unit includes the IRAs.

Petitioners claim that Santiago could not qualify into a component city
because its average annual last two (2) consecutive years based on 1991
constant prices falls below the required annual income of Pesos
(P20,000,000.00) for its conversion into a city, petitioners having computed
Santiagos average annual income in the following manner:
Total income (at 1991 constant prices) for 1991 P20,379,057.07
Total income (at 1991 constant prices) for 1992 P21,570,106.87

Total income for 1991 and 1992 P41,949,163.94

Minus:
IRAs for 1991 and 1992 P15,730,043.00

Total income for 1991 and 1992 P26,219,120.94

Average Annual Income P13,109,560.47
====================================
By dividing the total income of Santiago for calendar years 1991 and 1992,
after deducting the IRAs, the average annual income arrived at would only be
P13,109,560.47 based on the 1991 constant prices. Thus, petitioners claim
that Santiagos income is far below the aforesaid Twenty Million Pesos
average annual income requirement.
The certification issued by the Bureau of Local Government Finance of the
Department of Finance, which indicates Santiagos average annual income
to be P20,974,581.97, is allegedly not accurate as the Internal Revenue
Allotments were not excluded from the computation. Petitioners asseverate
that the IRAs are not actually income but transfers and/or budgetary aid from
the national government and that they fluctuate, increase or decrease,
depending on factors like population, land and equal sharing.

In this regard, we hold that petitioners asseverations are untenable because

Internal Revenue Allotments form part of the income of Local Government
Units.chanroblesvirtuallawlibrary
It is true that for a municipality to be converted into a component city, it must,
among others, have an average annual income of at least Twenty Million
Pesos for the last two (2) consecutive years based on 1991 constant prices.
1 Such income must be duly certified by the Department of Finance. 2
Resolution of the controversy regarding compliance by the Municipality of
Santiago with the aforecited income requirement hinges on a correlative and
contextual explication of the meaning of internal revenue allotments (IRAs)
vis-a-vis the notion of income of a local government unit and the principles of
local autonomy and decentralization underlying the institutionalization and
intensified empowerment of the local government system.
A Local Government Unit is a political subdivision of the State which is
constituted by law and possessed of substantial control over its own affairs. 3
Remaining to be an intra sovereign subdivision of one sovereign nation, but
not intended, however, to be an imperium in imperio, 4 the local government
unit is autonomous in the sense that it is given more powers, authority,
responsibilities and resources. 5 Power which used to be highly centralized
in Manila, is thereby deconcentrated, enabling especially the peripheral local
government units to develop not only at their own pace and discretion but
also with their own resources and assets. 6
The practical side to development through a decentralized local government
system certainly concerns the matter of financial resources. With its
broadened powers and increased responsibilities, a local government unit
must now operate on a much wider scale. More extensive operations, in turn,
entail more expenses. Understandably, the vesting of duty, responsibility and
accountability in every local government unit is accompanied with a provision
for reasonably adequate resources to discharge its powers and effectively
carry out its functions. 7 Availment of such resources is effectuated through
the vesting in every local government unit of (1) the right to create and
broaden its own source of revenue; (2) the right to be allocated a just share
in national taxes such share being in the form of internal revenue allotments
(IRAs); and (3) the right to be given its equitable share in the proceeds of the
utilization and development of the national wealth, if any, within its territorial
boundaries. 8
The funds generated from local taxes, IRAs and national wealth utilization
proceeds accrue to the general fund of the local government and are used to
finance its operations subject to specified modes of spending the same as
provided for in the Local Government Code and its implementing rules and
regulations. For instance, not less than twenty percent (20%) of the IRAs

must be set aside for local development projects. 9 As such, for purposes of
budget preparation, which budget should reflect the estimates of the income
of the local government unit, among others, the IRAs and the share in the
national wealth utilization proceeds are considered items of income. This is
as it should be, since income is defined in the Local Government Code to be
all revenues and receipts collected or received forming the gross accretions
of funds of the local government unit. 10
The IRAs are items of income because they form part of the gross accretion
of the funds of the local government unit. The IRAs regularly and
automatically accrue to the local treasury without need of any further action
on the part of the local government unit. 11 They thus constitute income
which the local government can invariably rely upon as the source of much
needed funds. For purposes of converting the Municipality of Santiago into a
city, the Department of Finance certified, among others, that the municipality
had an average annual income of at least Twenty Million Pesos for the last
two (2) consecutive years based on 1991 constant prices. This, the
Department of Finance did after including the IRAs in its computation of said
average annual income.chanroblesvirtuallawlibrary
Furthermore, Section 450 (c) of the Local Government Code provides that
"the average annual income shall include the income accruing to the general
fund, exclusive of special funds, transfers, and non-recurring income. To
reiterate, IRAs are a regular, recurring item of income; nil is there a basis,
too, to classify the same as a special fund or transfer, since IRAs have a
technical definition and meaning all its own as used in the Local Government
Code that unequivocally makes it distinct from special funds or transfers
referred to when the Code speaks of "funding support from the national
government, its instrumentalities and government-owned- or -controlled
corporations." 12
Thus, Department of Finance Order No. 35-93 13 correctly encapsulizes the
full import of the above disquisition when it defined ANNUAL INCOME to be
"revenues and receipts realized by provinces cities and municipalities from
regular sources of the Local General Fund including the internal revenue
allotment and other shares provided for in Sections 284, 290 and 291 of the
Code, but exclusive of non-recurring receipts, such as other national aids,
grants, financial assistance, loan proceeds, sales of fixed assets, and similar
others" (Underscoring ours). 14 Such order, constituting executive or
contemporaneous construction of a statute by an administrative agency
charged with the task of interpreting and applying the same, is entitled to full
respect and should be accorded great weight by the courts, unless such
construction is clearly shown to be in sharp conflict with the Constitution, the
governing statute, or other laws. 15

II.
In the enactment of RA No. 7720, there was compliance with Section
24, Article VI of the 1987 Constitution.
Although a bill of local application like HB No. 8817 should, by constitutional
prescription, 16 originate exclusively in the House of Representatives, the
claim of petitioners that Republic Act No. 7720 did not originate exclusively in
the House of Representatives because a bill of the same import, SB No.
1243, was passed in the Senate, is untenable because it cannot be denied
that HB No. 8817 was filed in the House of Representatives first before SB
No. 1243 was filed in the Senate. Petitioners themselves cannot disavow
their own admission that HB No. 8817 was filed on April 18, 1993 while SB
No. 1243 was filed on May 19, 1993. The filing of HB No. 8817 was thus
precursive not only of the said Act in question but also of SB No. 1243. Thus,
HB No. 8817, was the bill that initiated the legislative process that culminated
in the enactment of Republic Act No. 7720. No violation of Section 24, Article
VI, of the 1987 Constitution is perceptible under the circumstances attending
the instant controversy.chanroblesvirtuallawlibrary
Furthermore, petitioners themselves acknowledge that HB No. 8817 was
already approved on Third Reading and duly transmitted to the Senate when
the Senate Committee on Local Government conducted its public hearing on
HB No. 8817. HB No. 8817 was approved on the Third Reading on
December 17, 1993 and transmitted to the Senate on January 28, 1994; a
little less than a month thereafter or on February 23, 1994, the Senate
Committee on Local Government conducted public hearings on SB No. 1243.
Clearly, the Senate held in abeyance any action on SB No. 1243 until it
received HB No. 8817, already approved on the Third Reading, from the
House of Representatives. The filing in the Senate of a substitute bill in
anticipation of its receipt of the bill from the House, does not contravene the
constitutional requirement that a bill of local application should originate in
the House of Representatives, for as long as the Senate does not act
thereupon until it receives the House bill.
We have already addressed this issue in the case of Tolentino v. Secretary
of Finance. 17 There, on the matter of the Expanded Value Added Tax
(EVAT) Law, which, as a revenue bill, is nonetheless constitutionally required
to originate exclusively in the House of Representatives, we
explained:jgc:chanrobles.com.ph
". . . To begin with, it is not the law but the revenue bill which is
required by the Constitution to originate exclusively in the House of
Representatives. It is important to emphasize this, because a bill originating
in the House may undergo such extensive changes in the Senate that the
result may be a rewriting of the whole. . . . as a result of the Senate action, a
distinct bill may be produced. To insist that a revenue statute and not only
the bill which initiated the legislative process culminating in the enactment of

the law must substantially be the same as the House bill would be to deny
the Senates power not only to concur with amendments but also to
propose amendments. It would be to violate the co-equality of legislative
power of the two houses of Congress and in fact make the House superior to
the Senate.

constitutionality of RA No. 7720, the Court stands on the holding that

petitioners have failed to overcome the presumption. The dismissal of this
petition is, therefore, inevitable.

SO ORDERED.chanroblesvirtuallawlibrary

It is insisted, however, that S. No. 1630 was passed not in substitution of H.

No. 11197 but of another Senate bill (S. No. 1129) earlier filed and that what
the Senate did was merely to take [H. No. 11197] into consideration in
enacting S. No. 1630. There is really no difference between the Senate
preserving H. No. 11197 up to the enacting clause and then writing its own
version following the enacting clause (which, it would seem petitioners admit
is an amendment by substitution), and, on the other hand, separately
presenting a bill of its own on the same subject matter. In either case the
result are two bills on the same subject.
Indeed, what the Constitution simply means is that the initiative for filing
revenue, tariff, or tax bills, bills authorizing an increase of the public debt,
private bills and bills of local application must come from the House of
Representatives on the theory that, elected as they are from the districts, the
members of the House can be expected to be more sensitive to the local
needs and problems. On the other hand, the senators, who are elected at
large, are expected to approach the same problems from the national
perspective. Both views are thereby made to bear n the enactment of such
laws.
Nor does the Constitution prohibit the filing in the Senate of a substitute bill in
anticipation of its receipt of the bill from the House, so long as action by the
Senate as a body is withheld pending receipt of the House Bill. . . ." 18
III.
Every law, including RA No. 7720, has in its favor the presumption of
constitutionality.
It is a well-entrenched jurisprudential rule that on the side of every law lies
the presumption of constitutionality. 19 Consequently, for RA No. 7720 to be
nullified it must be shown that there is a clear and unequivocal breach of the
Constitution, not merely a doubtful and equivocal one; in other words, the
grounds for nullity must be clear and beyond reasonable doubt. 20 Those
who petition this court to declare a law to be unconstitutional must clearly
and fully establish the basis that will justify such a declaration; otherwise,
their petition must fail. Taking into consideration the justification of our stand
on the immediately preceding ground raised by petitioners to challenge the

WHEREFORE, the instant petition is DISMISSED for lack of merit with costs
against petitioners.

Narvasa, C.J., Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo,

Puno, Vitug, Kapunan, Mendoza, Francisco and Panganiban, JJ., concur.

[G.R. No. 132988. July 19, 2000]

ADOPTION OF ECONOMY MEASURES IN GOVERNMENT FOR FY 1998
AQUILINO Q. PIMENTEL JR., petitioner, vs. Hon. ALEXANDER
AGUIRRE in his capacity as Executive Secretary, Hon. EMILIA
BONCODIN in her capacity as Secretary of the Department of Budget
and Management, respondents.
ROBERTO PAGDANGANAN, intervenor.
DECISION
PANGANIBAN, J.:
The Constitution vests the President with the power of supervision, not
control, over local government units (LGUs). Such power enables him to see
to it that LGUs and their officials execute their tasks in accordance with law.
While he may issue advisories and seek their cooperation in solving
economic difficulties, he cannot prevent them from performing their tasks and
using available resources to achieve their goals. He may not withhold or alter
any authority or power given them by the law. Thus, the withholding of a
portion of internal revenue allotments legally due them cannot be directed by
administrative fiat.
The Case
Before us is an original Petition for Certiorari and Prohibition seeking (1) to
annul Section 1 of Administrative Order (AO) No. 372, insofar as it requires
local government units to reduce their expenditures by 25 percent of their
authorized regular appropriations for non-personal services; and (2) to enjoin
respondents from implementing Section 4 of the Order, which withholds a
portion of their internal revenue allotments.
On November 17, 1998, Roberto Pagdanganan, through Counsel Alberto C.
Agra, filed a Motion for Intervention/Motion to Admit Petition for
Intervention,[1] attaching thereto his Petition in Intervention[2] joining
petitioner in the reliefs sought. At the time, intervenor was the provincial
governor of Bulacan, national president of the League of Provinces of the
Philippines and chairman of the League of Leagues of Local Governments.
In a Resolution dated December 15, 1998, the Court noted said Motion and
Petition.
The Facts and the Arguments
On December 27, 1997, the President of the Philippines issued AO 372. Its
full text, with emphasis on the assailed provisions, is as follows:
"ADMINISTRATIVE ORDER NO. 372

WHEREAS, the current economic difficulties brought about by the peso

depreciation requires continued prudence in government fiscal management
to maintain economic stability and sustain the country's growth momentum;
WHEREAS, it is imperative that all government agencies adopt cash
management measures to match expenditures with available resources;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the
Philippines, by virtue of the powers vested in me by the Constitution, do
hereby order and direct:
SECTION 1. All government departments and agencies, including state
universities and colleges, government-owned and controlled corporations
and local governments units will identify and implement measures in FY 1998
that will reduce total expenditures for the year by at least 25% of authorized
regular appropriations for non-personal services items, along the following
suggested areas:
1. Continued implementation of the streamlining policy on organization and
staffing by deferring action on the following:
a. Operationalization of new agencies;
b. Expansion of organizational units and/or creation of positions;
c. Filling of positions; and
d. Hiring of additional/new consultants, contractual and casual personnel,
regardless of funding source.
2. Suspension of the following activities:
a. Implementation of new capital/infrastructure projects, except those which
have already been contracted out;
b. Acquisition of new equipment and motor vehicles;
c. All foreign travels of government personnel, except those associated with
scholarships and trainings funded by grants;
d. Attendance in conferences abroad where the cost is charged to the
government except those clearly essential to Philippine commitments in the
international field as may be determined by the Cabinet;

e. Conduct of trainings/workshops/seminars, except those conducted by

government training institutions and agencies in the performance of their
regular functions and those that are funded by grants;
f. Conduct of cultural and social celebrations and sports activities, except
those associated with the Philippine Centennial celebration and those
involving regular competitions/events;
g. Grant of honoraria, except in cases where it constitutes the only source of
compensation from government received by the person concerned;
h. Publications, media advertisements and related items, except those
required by law or those already being undertaken on a regular basis;
i. Grant of new/additional benefits to employees, except those expressly and
specifically authorized by law; and
j. Donations, contributions, grants and gifts, except those given by institutions
to victims of calamities.
3. Suspension of all tax expenditure subsidies to all GOCCs and LGUs
4. Reduction in the volume of consumption of fuel, water, office supplies,
electricity and other utilities
5. Deferment of projects that are encountering significant implementation
problems
6. Suspension of all realignment of funds and the use of savings and
reserves
SECTION 2. Agencies are given the flexibility to identify the specific sources
of cost-savings, provided the 25% minimum savings under Section 1 is
complied with.
SECTION 3. A report on the estimated savings generated from these
measures shall be submitted to the Office of the President, through the
Department of Budget and Management, on a quarterly basis using the
attached format.
SECTION 4. Pending the assessment and evaluation by the Development
Budget Coordinating Committee of the emerging fiscal situation, the amount
equivalent to 10% of the internal revenue allotment to local government units
shall be withheld.

SECTION 5. The Development Budget Coordination Committee shall

conduct a monthly review of the fiscal position of the National Government
and if necessary, shall recommend to the President the imposition of
additional reserves or the lifting of previously imposed reserves.
SECTION 6. This Administrative Order shall take effect January 1, 1998 and
shall remain valid for the entire year unless otherwise lifted.
DONE in the City of Manila, this 27th day of December, in the year of our
Lord, nineteen hundred and ninety-seven."
Subsequently, on December 10, 1998, President Joseph E. Estrada issued
AO 43, amending Section 4 of AO 372, by reducing to five percent (5%) the
amount of internal revenue allotment (IRA) to be withheld from the LGUs.
Petitioner contends that the President, in issuing AO 372, was in effect
exercising the power of control over LGUs. The Constitution vests in the
President, however, only the power of general supervision over LGUs,
consistent with the principle of local autonomy. Petitioner further argues that
the directive to withhold ten percent (10%) of their IRA is in contravention of
Section 286 of the Local Government Code and of Section 6, Article X of the
Constitution, providing for the automatic release to each of these units its
share in the national internal revenue.
The solicitor general, on behalf of the respondents, claims on the other hand
that AO 372 was issued to alleviate the "economic difficulties brought about
by the peso devaluation" and constituted merely an exercise of the
President's power of supervision over LGUs. It allegedly does not violate
local fiscal autonomy, because it merely directs local governments to identify
measures that will reduce their total expenditures for non-personal services
by at least 25 percent. Likewise, the withholding of 10 percent of the LGUs
IRA does not violate the statutory prohibition on the imposition of any lien or
holdback on their revenue shares, because such withholding is "temporary in
nature pending the assessment and evaluation by the Development
Coordination Committee of the emerging fiscal situation."
The Issues
The Petition[3] submits the following issues for the Court's resolution:
"A. Whether or not the president committed grave abuse of discretion [in]
ordering all LGUS to adopt a 25% cost reduction program in violation of the
LGU[']S fiscal autonomy
"B. Whether or not the president committed grave abuse of discretion in
ordering the withholding of 10% of the LGU[']S IRA"

In sum, the main issue is whether (a) Section 1 of AO 372, insofar as it

"directs" LGUs to reduce their expenditures by 25 percent; and (b) Section 4
of the same issuance, which withholds 10 percent of their internal revenue
allotments, are valid exercises of the President's power of general
supervision over local governments.
Additionally, the Court deliberated on the question whether petitioner had the
locus standi to bring this suit, despite respondents' failure to raise the
issue.[4] However, the intervention of Roberto Pagdanganan has rendered
academic any further discussion on this matter.
The Court's Ruling
The Petition is partly meritorious.
Main Issue:
Validity of AO 372
Insofar as LGUs Are Concerned
Before resolving the main issue, we deem it important and appropriate to
define certain crucial concepts: (1) the scope of the President's power of
general supervision over local governments and (2) the extent of the local
governments' autonomy.
Scope of President's Power of Supervision Over LGUs
Section 4 of Article X of the Constitution confines the President's power over
local governments to one of general supervision. It reads as follows:
"Sec. 4. The President of the Philippines shall exercise general supervision
over local governments. x x x"
This provision has been interpreted to exclude the power of control. In
Mondano v. Silvosa,[5] the Court contrasted the President's power of
supervision over local government officials with that of his power of control
over executive officials of the national government. It was emphasized that
the two terms -- supervision and control -- differed in meaning and extent.
The Court distinguished them as follows:
"x x x In administrative law, supervision means 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. Control, on the other
hand, means the power of an officer to alter or modify or nullify or set aside
what a subordinate officer ha[s] done in the performance of his duties and to
substitute the judgment of the former for that of the latter."[6]

In Taule v. Santos,[7] we further stated that the Chief Executive wielded no

more authority than that of checking whether local governments or their
officials were performing their duties as provided by the fundamental law and
by statutes. He cannot interfere with local governments, so long as they act
within the scope of their authority. "Supervisory power, when contrasted with
control, is the power of mere oversight over an inferior body; it does not
include any restraining authority over such body,"[8] we said.
In a more recent case, Drilon v. Lim,[9] the difference between control and
supervision was further delineated. Officers in control lay down the rules in
the performance or accomplishment of an act. If these rules are not followed,
they may, in their discretion, order the act undone or redone by their
subordinates or even decide to do it themselves. On the other hand,
supervision does not cover such authority. Supervising officials merely see to
it that the rules are followed, but they themselves do not lay down such rules,
nor do they have the discretion to modify or replace them. If the rules are not
observed, they may order the work done or redone, but only to conform to
such rules. They may not prescribe their own manner of execution of the act.
They have no discretion on this matter except to see to it that the rules are
followed.
Under our present system of government, executive power is vested in the
President.[10] The members of the Cabinet and other executive officials are
merely alter egos. As such, they are subject to the power of control of the
President, at whose will and behest they can be removed from office; or their
actions and decisions changed, suspended or reversed.[11] In contrast, the
heads of political subdivisions are elected by the people. Their sovereign
powers emanate from the electorate, to whom they are directly accountable.
By constitutional fiat, they are subject to the Presidents supervision only, not
control, so long as their acts are exercised within the sphere of their
legitimate powers. By the same token, the President may not withhold or
alter any authority or power given them by the Constitution and the law.
Extent of Local Autonomy
Hand in hand with the constitutional restraint on the President's power over
local governments is the state policy of ensuring local autonomy.[12]
In Ganzon v. Court of Appeals,[13] we said that local autonomy signified "a
more responsive and accountable local government structure instituted
through a system of decentralization." The grant of autonomy is intended to
"break up the monopoly of the national government over the affairs of local
governments, x x x not x x x to end the relation of partnership and
interdependence between the central administration and local government

units x x x." Paradoxically, local governments are still subject to regulation,

however limited, for the purpose of enhancing self-government.[14]
Decentralization simply means the devolution of national administration, not
power, to local governments. Local officials remain accountable to the central
government as the law may provide.[15] The difference between
decentralization of administration and that of power was explained in detail in
Limbona v. Mangelin[16] as follows:
"Now, autonomy is either decentralization of administration or
decentralization of power. There is decentralization of administration when
the central government delegates administrative powers to political
subdivisions in order to broaden the base of government power and in the
process to make local governments 'more responsive and accountable,'[17]
and 'ensure their fullest development as self-reliant communities and make
them more effective partners in the pursuit of national development and
social progress.'[18] At the same time, it relieves the central government of
the burden of managing local affairs and enables it to concentrate on national
concerns. The President exercises 'general supervision'[19] over them, but
only to 'ensure that local affairs are administered according to law.'[20] He
has no control over their acts in the sense that he can substitute their
judgments with his own.[21]
Decentralization of power, on the other hand, involves an abdication of
political power in the favor of local government units declared to be
autonomous. In that case, the autonomous government is free to chart its
own destiny and shape its future with minimum intervention from central
authorities. According to a constitutional author, decentralization of power
amounts to 'self-immolation,' since in that event, the autonomous
government becomes accountable not to the central authorities but to its
constituency."[22]
Under the Philippine concept of local autonomy, the national government has
not completely relinquished all its powers over local governments, including
autonomous regions. Only administrative powers over local affairs are
delegated to political subdivisions. The purpose of the delegation is to make
governance more directly responsive and effective at the local levels. In turn,
economic, political and social development at the smaller political units are
expected to propel social and economic growth and development. But to
enable the country to develop as a whole, the programs and policies effected
locally must be integrated and coordinated towards a common national goal.
Thus, policy-setting for the entire country still lies in the President and
Congress. As we stated in Magtajas v. Pryce Properties Corp., Inc.,
municipal governments are still agents of the national government.[23]
The Nature of AO 372

Consistent with the foregoing jurisprudential precepts, let us now look into
the nature of AO 372. As its preambular clauses declare, the Order was a
"cash management measure" adopted by the government "to match
expenditures with available resources," which were presumably depleted at
the time due to "economic difficulties brought about by the peso
depreciation." Because of a looming financial crisis, the President deemed it
necessary to "direct all government agencies, state universities and colleges,
government-owned and controlled corporations as well as local governments
to reduce their total expenditures by at least 25 percent along suggested
areas mentioned in AO 372.
Under existing law, local government units, in addition to having
administrative autonomy in the exercise of their functions, enjoy fiscal
autonomy as well. Fiscal autonomy means that local governments have the
power to create their own sources of revenue in addition to their equitable
share in the national taxes released by the national government, as well as
the power to allocate their resources in accordance with their own priorities. It
extends to the preparation of their budgets, and local officials in turn have to
work within the constraints thereof. They are not formulated at the national
level and imposed on local governments, whether they are relevant to local
needs and resources or not. Hence, the necessity of a balancing of
viewpoints and the harmonization of proposals from both local and national
officials,[24] who in any case are partners in the attainment of national goals.
Local fiscal autonomy does not however rule out any manner of national
government intervention by way of supervision, in order to ensure that local
programs, fiscal and otherwise, are consistent with national goals.
Significantly, the President, by constitutional fiat, is the head of the economic
and planning agency of the government,[25] primarily responsible for
formulating and implementing continuing, coordinated and integrated social
and economic policies, plans and programs[26] for the entire country.
However, under the Constitution, the formulation and the implementation of
such policies and programs are subject to "consultations with the appropriate
public agencies, various private sectors, and local government units." The
President cannot do so unilaterally.
Consequently, the Local Government Code provides:[27]
"x x x [I]n the event the national government incurs an unmanaged public
sector deficit, the President of the Philippines is hereby authorized, upon the
recommendation of [the] Secretary of Finance, Secretary of the Interior and
Local Government and Secretary of Budget and Management, and subject to
consultation with the presiding officers of both Houses of Congress and the
presidents of the liga, to make the necessary adjustments in the internal
revenue allotment of local government units but in no case shall the allotment

be less than thirty percent (30%) of the collection of national internal revenue
taxes of the third fiscal year preceding the current fiscal year x x x."
There are therefore several requisites before the President may interfere in
local fiscal matters: (1) an unmanaged public sector deficit of the national
government; (2) consultations with the presiding officers of the Senate and
the House of Representatives and the presidents of the various local
leagues; and (3) the corresponding recommendation of the secretaries of the
Department of Finance, Interior and Local Government, and Budget and
Management. Furthermore, any adjustment in the allotment shall in no case
be less than thirty percent (30%) of the collection of national internal revenue
taxes of the third fiscal year preceding the current one.
Petitioner points out that respondents failed to comply with these requisites
before the issuance and the implementation of AO 372. At the very least,
they did not even try to show that the national government was suffering from
an unmanageable public sector deficit. Neither did they claim having
conducted consultations with the different leagues of local governments.
Without these requisites, the President has no authority to adjust, much less
to reduce, unilaterally the LGU's internal revenue allotment.
The solicitor general insists, however, that AO 372 is merely directory and
has been issued by the President consistent with his power of supervision
over local governments. It is intended only to advise all government agencies
and instrumentalities to undertake cost-reduction measures that will help
maintain economic stability in the country, which is facing economic
difficulties. Besides, it does not contain any sanction in case of
noncompliance. Being merely an advisory, therefore, Section 1 of AO 372 is
well within the powers of the President. Since it is not a mandatory
imposition, the directive cannot be characterized as an exercise of the power
of control.
While the wordings of Section 1 of AO 372 have a rather commanding tone,
and while we agree with petitioner that the requirements of Section 284 of
the Local Government Code have not been satisfied, we are prepared to
accept the solicitor general's assurance that the directive to "identify and
implement measures x x x that will reduce total expenditures x x x by at least
25% of authorized regular appropriation" is merely advisory in character, and
does not constitute a mandatory or binding order that interferes with local
autonomy. The language used, while authoritative, does not amount to a
command that emanates from a boss to a subaltern.
Rather, the provision is merely an advisory to prevail upon local executives to
recognize the need for fiscal restraint in a period of economic difficulty.
Indeed, all concerned would do well to heed the President's call to unity,
solidarity and teamwork to help alleviate the crisis. It is understood, however,

that no legal sanction may be imposed upon LGUs and their officials who do
not follow such advice. It is in this light that we sustain the solicitor general's
contention in regard to Section 1.
Withholding a Part of LGUs' IRA
Section 4 of AO 372 cannot, however, be upheld. A basic feature of local
fiscal autonomy is the automatic release of the shares of LGUs in the
national internal revenue. This is mandated by no less than the
Constitution.[28] The Local Government Code[29] specifies further that the
release shall be made directly to the LGU concerned within five (5) days after
every quarter of the year and "shall not be subject to any lien or holdback
that may be imposed by the national government for whatever purpose."[30]
As a rule, the term "shall" is a word of command that must be given a
compulsory meaning.[31] The provision is, therefore, imperative.
Section 4 of AO 372, however, orders the withholding, effective January 1,
1998, of 10 percent of the LGUs' IRA "pending the assessment and
evaluation by the Development Budget Coordinating Committee of the
emerging fiscal situation" in the country. Such withholding clearly
contravenes the Constitution and the law. Although temporary, it is
equivalent to a holdback, which means "something held back or withheld,
often temporarily."[32] Hence, the "temporary" nature of the retention by the
national government does not matter. Any retention is prohibited.
In sum, while Section 1 of AO 372 may be upheld as an advisory effected in
times of national crisis, Section 4 thereof has no color of validity at all. The
latter provision effectively encroaches on the fiscal autonomy of local
governments. Concededly, the President was well-intentioned in issuing his
Order to withhold the LGUs IRA, but the rule of law requires that even the
best intentions must be carried out within the parameters of the Constitution
and the law. Verily, laudable purposes must be carried out by legal methods.
Refutation of Justice Kapunan's Dissent
Mr. Justice Santiago M. Kapunan dissents from our Decision on the grounds
that, allegedly, (1) the Petition is premature; (2) AO 372 falls within the
powers of the President as chief fiscal officer; and (3) the withholding of the
LGUs IRA is implied in the President's authority to adjust it in case of an
unmanageable public sector deficit.
First, on prematurity. According to the Dissent, when "the conduct has not
yet occurred and the challenged construction has not yet been adopted by
the agency charged with administering the administrative order, the
determination of the scope and constitutionality of the executive action in

advance of its immediate adverse effect involves too remote and abstract an
inquiry for the proper exercise of judicial function."

law. Where the statute violates the Constitution, it is not only the right but the
duty of the judiciary to declare such act unconstitutional and void."

This is a rather novel theory -- that people should await the implementing evil
to befall on them before they can question acts that are illegal or
unconstitutional. Be it remembered that the real issue here is whether the
Constitution and the law are contravened by Section 4 of AO 372, not
whether they are violated by the acts implementing it. In the unanimous en
banc case Taada v. Angara,[33] this Court held that when an act of the
legislative department is seriously alleged to have infringed the Constitution,
settling the controversy becomes the duty of this Court. By the mere
enactment of the questioned law or the approval of the challenged action, the
dispute is said to have ripened into a judicial controversy even without any
other overt act. Indeed, even a singular violation of the Constitution and/or
the law is enough to awaken judicial duty. Said the Court:

By the same token, when an act of the President, who in our constitutional
scheme is a coequal of Congress, is seriously alleged to have infringed the
Constitution and the laws, as in the present case, settling the dispute
becomes the duty and the responsibility of the courts.

"In seeking to nullify an act of the Philippine Senate on the ground that it
contravenes the Constitution, the petition no doubt raises a justiciable
controversy. Where an action of the legislative branch is seriously alleged to
have infringed the Constitution, it becomes not only the right but in fact the
duty of the judiciary to settle the dispute. 'The question thus posed is judicial
rather than political. The duty (to adjudicate) remains to assure that the
supremacy of the Constitution is upheld.'[34] Once a 'controversy as to the
application or interpretation of a constitutional provision is raised before this
Court x x x , it becomes a legal issue which the Court is bound by
constitutional mandate to decide.'[35]
xxxxxxxxx
"As this Court has repeatedly and firmly emphasized in many cases,[36] it
will not shirk, digress from or abandon its sacred duty and authority to uphold
the Constitution in matters that involve grave abuse of discretion brought
before it in appropriate cases, committed by any officer, agency,
instrumentality or department of the government."
In the same vein, the Court also held in Tatad v. Secretary of the Department
of Energy:[37]
"x x x Judicial power includes not only the duty of the courts to settle actual
controversies involving rights which are legally demandable and enforceable,
but also the duty to determine whether or not there has been grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of government. The courts, as guardians of the
Constitution, have the inherent authority to determine whether a statute
enacted by the legislature transcends the limit imposed by the fundamental

Besides, the issue that the Petition is premature has not been raised by the
parties; hence it is deemed waived. Considerations of due process really
prevents its use against a party that has not been given sufficient notice of its
presentation, and thus has not been given the opportunity to refute it.[38]
Second, on the President's power as chief fiscal officer of the country.
Justice Kapunan posits that Section 4 of AO 372 conforms with the
President's role as chief fiscal officer, who allegedly "is clothed by law with
certain powers to ensure the observance of safeguards and auditing
requirements, as well as the legal prerequisites in the release and use of
IRAs, taking into account the constitutional and statutory mandates."[39] He
cites instances when the President may lawfully intervene in the fiscal affairs
of LGUs.
Precisely, such powers referred to in the Dissent have specifically been
authorized by law and have not been challenged as violative of the
Constitution. On the other hand, Section 4 of AO 372, as explained earlier,
contravenes explicit provisions of the Local Government Code (LGC) and the
Constitution. In other words, the acts alluded to in the Dissent are indeed
authorized by law; but, quite the opposite, Section 4 of AO 372 is bereft of
any legal or constitutional basis.
Third, on the President's authority to adjust the IRA of LGUs in case of an
unmanageable public sector deficit. It must be emphasized that in striking
down Section 4 of AO 372, this Court is not ruling out any form of reduction
in the IRAs of LGUs. Indeed, as the President may make necessary
adjustments in case of an unmanageable public sector deficit, as stated in
the main part of this Decision, and in line with Section 284 of the LGC, which
Justice Kapunan cites. He, however, merely glances over a specific
requirement in the same provision -- that such reduction is subject to
consultation with the presiding officers of both Houses of Congress and,
more importantly, with the presidents of the leagues of local governments.
Notably, Justice Kapunan recognizes the need for "interaction between the
national government and the LGUs at the planning level," in order to ensure
that "local development plans x x x hew to national policies and standards."
The problem is that no such interaction or consultation was ever held prior to
the issuance of AO 372. This is why the petitioner and the intervenor (who

was a provincial governor and at the same time president of the League of
Provinces of the Philippines and chairman of the League of Leagues of Local
Governments) have protested and instituted this action. Significantly,
respondents do not deny the lack of consultation.
In addition, Justice Kapunan cites Section 287[40] of the LGC as impliedly
authorizing the President to withhold the IRA of an LGU, pending its
compliance with certain requirements. Even a cursory reading of the
provision reveals that it is totally inapplicable to the issue at bar. It directs
LGUs to appropriate in their annual budgets 20 percent of their respective
IRAs for development projects. It speaks of no positive power granted the
President to priorly withhold any amount. Not at all.
WHEREFORE, the Petition is GRANTED. Respondents and their successors
are hereby permanently PROHIBITED from implementing Administrative
Order Nos. 372 and 43, respectively dated December 27, 1997 and
December 10, 1998, insofar as local government units are concerned.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Mendoza, Quisumbing, Pardo,
Buena, Gonzaga-Reyes, and De Leon, Jr., JJ., concur.
Kapunan, J., see dissenting opinion.
Purisima, and Ynares-Santiago, JJ., join J. Kapunan in his dissenting
opinion.

G.R. No. 152774

May 27, 2004

THE PROVINCE OF BATANGAS, represented by its Governor,

HERMILANDO I. MANDANAS, petitioner,
vs.
HON. ALBERTO G. ROMULO, Executive Secretary and Chairman of the
Oversight Committee on Devolution; HON. EMILIA BONCODIN,
Secretary, Department of Budget and Management; HON. JOSE D. LINA,
JR., Secretary, Department of Interior and Local Government,
respondents.

Fund" was created. For 1998, the DBM was directed to set aside an amount
to be determined by the Oversight Committee based on the devolution status
4
appraisal surveys undertaken by the DILG. The initial fund was to be
5
sourced from the available savings of the national government for CY 1998.
For 1999 and the succeeding years, the corresponding amount required to
6
sustain the program was to be incorporated in the annual GAA. The
Oversight Committee has been authorized to issue the implementing rules
and regulations governing the equitable allocation and distribution of said
7
fund to the LGUs.
The LGSEF in the GAA of 1999

DECISION
CALLEJO, SR., J.:
The Province of Batangas, represented by its Governor, Hermilando I.
Mandanas, filed the present petition for certiorari, prohibition and mandamus
under Rule 65 of the Rules of Court, as amended, to declare as
unconstitutional and void certain provisos contained in the General
Appropriations Acts (GAA) of 1999, 2000 and 2001, insofar as they uniformly
earmarked for each corresponding year the amount of five billion pesos
(P5,000,000,000.00) of the Internal Revenue Allotment (IRA) for the Local
Government Service Equalization Fund (LGSEF) and imposed conditions for
the release thereof.
Named as respondents are Executive Secretary Alberto G. Romulo, in his
capacity as Chairman of the Oversight Committee on Devolution, Secretary
Emilia Boncodin of the Department of Budget and Management (DBM) and
Secretary Jose Lina of the Department of Interior and Local Government
(DILG).
Background
On December 7, 1998, then President Joseph Ejercito Estrada issued
Executive Order (E.O.) No. 48 entitled "ESTABLISHING A PROGRAM FOR
DEVOLUTION ADJUSTMENT AND EQUALIZATION." The program was
established to "facilitate the process of enhancing the capacities of local
government units (LGUs) in the discharge of the functions and services
devolved to them by the National Government Agencies concerned pursuant
1
to the Local Government Code." The Oversight Committee (referred to as
the Devolution Committee in E.O. No. 48) constituted under Section 533(b) of
Republic Act No. 7160 (The Local Government Code of 1991) has been
tasked to formulate and issue the appropriate rules and regulations
2
necessary for its effective implementation. Further, to address the funding
shortfalls of functions and services devolved to the LGUs and other funding
requirements of the program, the "Devolution Adjustment and Equalization

In Republic Act No. 8745, otherwise known as the GAA of 1999, the program
was renamed as the LOCAL GOVERNMENT SERVICE EQUALIZATION
FUND (LGSEF). Under said appropriations law, the amount of
P96,780,000,000 was allotted as the share of the LGUs in the internal
revenue taxes. Item No. 1, Special Provisions, Title XXXVI A. Internal
Revenue Allotment of Rep. Act No. 8745 contained the following proviso:
... PROVIDED, That the amount of FIVE BILLION PESOS (P5,000,000,000)
shall be earmarked for the Local Government Service Equalization Fund for
the funding requirements of projects and activities arising from the full and
efficient implementation of devolved functions and services of local
government units pursuant to R.A. No. 7160, otherwise known as the Local
Government Code of 1991: PROVIDED, FURTHER, That such amount shall
be released to the local government units subject to the implementing rules
and regulations, including such mechanisms and guidelines for the equitable
allocations and distribution of said fund among local government units subject
to the guidelines that may be prescribed by the Oversight Committee on
Devolution as constituted pursuant to Book IV, Title III, Section 533(b) of R.A.
No. 7160. The Internal Revenue Allotment shall be released directly by the
Department of Budget and Management to the Local Government Units
concerned.
On July 28, 1999, the Oversight Committee (with then Executive Secretary
Ronaldo B. Zamora as Chairman) passed Resolution Nos. OCD-99-003,
OCD-99-005 and OCD-99-006 entitled as follows:
OCD-99-005
RESOLUTION ADOPTING THE ALLOCATION SCHEME FOR THE PhP5
BILLION CY 1999 LOCAL GOVERNMENT SERVICE EQUALIZATION FUND
(LGSEF) AND REQUESTING HIS EXCELLENCY PRESIDENT JOSEPH
EJERCITO ESTRADA TO APPROVE SAID ALLOCATION SCHEME.
OCD-99-006

RESOLUTION ADOPTING THE ALLOCATION SCHEME FOR THE PhP4.0

BILLION OF THE 1999 LOCAL GOVERNMENT SERVICE EQUALIZATION
FUND
AND
ITS
CONCOMITANT
GENERAL
FRAMEWORK,
IMPLEMENTING
GUIDELINES
AND
MECHANICS
FOR
ITS
IMPLEMENTATION AND RELEASE, AS PROMULGATED BY THE
OVERSIGHT COMMITTEE ON DEVOLUTION.

in 1999 IRA share due to reduction in land area have been taken out.

OCD-99-003

In Resolution No. OCD-99-003, the Oversight Committee set aside the one
billion pesos or 20% of the LGSEF to support Local Affirmative Action
Projects (LAAPs) of LGUs. This remaining amount was intended to "respond
to the urgent need for additional funds assistance, otherwise not available
within the parameters of other existing fund sources." For LGUs to be eligible
for funding under the one-billion-peso portion of the LGSEF, the OCD
promulgated the following:

RESOLUTION REQUESTING HIS EXCELLENCY PRESIDENT JOSEPH

EJERCITO ESTRADA TO APPROVE THE REQUEST OF THE OVERSIGHT
COMMITTEE ON DEVOLUTION TO SET ASIDE TWENTY PERCENT (20%)
OF THE LOCAL GOVERNMENT SERVICE EQUALIZATION FUND (LGSEF)
FOR LOCAL AFFIRMATIVE ACTION PROJECTS AND OTHER PRIORITY
INITIATIVES FOR LGUs INSTITUTIONAL AND CAPABILITY BUILDING IN
ACCORDANCE WITH THE IMPLEMENTING GUIDELINES AND
MECHANICS AS PROMULGATED BY THE COMMITTEE.
These OCD resolutions were approved by then President Estrada on October
6, 1999.
Under the allocation scheme adopted pursuant to Resolution No. OCD-99005, the five billion pesos LGSEF was to be allocated as follows:
1. The PhP4 Billion of the LGSEF shall be allocated in accordance with the
allocation scheme and implementing guidelines and mechanics promulgated
and adopted by the OCD. To wit:
a. The first PhP2 Billion of the LGSEF shall be allocated in accordance with
the codal formula sharing scheme as prescribed under the 1991 Local
Government Code;
b. The second PhP2 Billion of the LGSEF shall be allocated in accordance
with a modified 1992 cost of devolution fund (CODEF) sharing scheme, as
recommended by the respective leagues of provinces, cities and
municipalities to the OCD. The modified CODEF sharing formula is as
follows:

2. The remaining PhP1 Billion of the LGSEF shall be earmarked to support

local affirmative action projects and other priority initiatives submitted by
LGUs to the Oversight Committee on Devolution for approval in accordance
with its prescribed guidelines as promulgated and adopted by the OCD.

III. CRITERIA FOR ELIGIBILITY:

1. LGUs (province, city, municipality, or barangay), individually or by group or
multi-LGUs or leagues of LGUs, especially those belonging to the 5th and 6th
class, may access the fund to support any projects or activities that satisfy
any of the aforecited purposes. A barangay may also access this fund directly
or through their respective municipality or city.
2. The proposed project/activity should be need-based, a local priority, with
high development impact and are congruent with the socio-cultural, economic
and development agenda of the Estrada Administration, such as food
security, poverty alleviation, electrification, and peace and order, among
others.
3. Eligible for funding under this fund are projects arising from, but not limited
to, the following areas of concern:
a. delivery of local health and sanitation services, hospital services and other
tertiary services;
b. delivery of social welfare services;

Province : 40%

c. provision of socio-cultural services and facilities for youth and community

development;

Cities : 20%

d. provision of agricultural and on-site related research;

Municipalities : 40%

e. improvement of community-based forestry projects and other local projects

on environment and natural resources protection and conservation;

This is applied to the P2 Billion after the approved amounts granted to

individual provinces, cities and municipalities as assistance to cover decrease

f. improvement of tourism facilities and promotion of tourism;

g. peace and order and public safety;

(a) general description or brief of the project;

h. construction, repair and maintenance of public works and infrastructure,

including public buildings and facilities for public use, especially those
destroyed or damaged by man-made or natural calamities and disaster as
well as facilities for water supply, flood control and river dikes;

(b) objectives and justifications for undertaking the project, which should
highlight the benefits to the locality and the expected impact to the local
program/project arising from the full and efficient implementation of social
services and facilities, at the local levels;

i. provision of local electrification facilities;

(c) target outputs or key result areas;

j. livelihood and food production services, facilities and equipment;

(d) schedule of activities and details of requirements;

k. other projects that may be authorized by the OCD consistent with the
aforementioned objectives and guidelines;

(e) total cost requirement of the project;

4. Except on extremely meritorious cases, as may be determined by the

Oversight Committee on Devolution, this portion of the LGSEF shall not be
used in expenditures for personal costs or benefits under existing laws
applicable to governments. Generally, this fund shall cover the following
objects of expenditures for programs, projects and activities arising from the
implementation of devolved and regular functions and services:
a. acquisition/procurement of supplies and materials critical to the full and
effective implementation of devolved programs, projects and activities;
b. repair and/or improvement of facilities;
c. repair and/or upgrading of equipment;

(f) proponent's counterpart funding share, if any, and identified source(s) of

counterpart funds for the full implementation of the project;
(g) requested amount of project cost to be covered by the LGSEF.
Further, under the guidelines formulated by the Oversight Committee as
contained in Attachment - Resolution No. OCD-99-003, the LGUs were
required to identify the projects eligible for funding under the one-billion-peso
portion of the LGSEF and submit the project proposals thereof and other
documentary requirements to the DILG for appraisal. The project proposals
that passed the DILG's appraisal would then be submitted to the Oversight
Committee for review, evaluation and approval. Upon its approval, the
Oversight Committee would then serve notice to the DBM for the preparation
of the Special Allotment Release Order (SARO) and Notice of Cash
Allocation (NCA) to effect the release of funds to the said LGUs.

d. acquisition of basic equipment;

The LGSEF in the GAA of 2000
e. construction of additional or new facilities;
f. counterpart contribution to joint arrangements or collective projects among
groups of municipalities, cities and/or provinces related to devolution and
delivery of basic services.
5. To be eligible for funding, an LGU or group of LGU shall submit to the
Oversight Committee on Devolution through the Department of Interior and
Local Governments, within the prescribed schedule and timeframe, a Letter
Request for Funding Support from the Affirmative Action Program under the
LGSEF, duly signed by the concerned LGU(s) and endorsed by cooperators
and/or beneficiaries, as well as the duly signed Resolution of Endorsement by
the respective Sanggunian(s) of the LGUs concerned. The LGU-proponent
shall also be required to submit the Project Request (PR), using OCD Project
Request Form No. 99-02, that details the following:

Under Rep. Act No. 8760, otherwise known as the GAA of 2000, the amount
of P111,778,000,000 was allotted as the share of the LGUs in the internal
revenue taxes. As in the GAA of 1999, the GAA of 2000 contained a proviso
earmarking five billion pesos of the IRA for the LGSEF. This proviso, found in
Item No. 1, Special Provisions, Title XXXVII A. Internal Revenue Allotment,
was similarly worded as that contained in the GAA of 1999.
The Oversight Committee, in its Resolution No. OCD-2000-023 dated June
22, 2000, adopted the following allocation scheme governing the five billion
pesos LGSEF for 2000:
1. The PhP3.5 Billion of the CY 2000 LGSEF shall be allocated to and shared
by the four levels of LGUs, i.e., provinces, cities, municipalities, and
barangays, using the following percentage-sharing formula agreed upon and
jointly endorsed by the various Leagues of LGUs:

For Provinces 26% or P 910,000,000

For Cities 23% or 805,000,000
For Municipalities 35% or 1,225,000,000
For Barangays 16% or 560,000,000
Provided that the respective Leagues representing the provinces, cities,
municipalities and barangays shall draw up and adopt the horizontal
distribution/sharing schemes among the member LGUs whereby the Leagues
concerned may opt to adopt direct financial assistance or project-based
arrangement, such that the LGSEF allocation for individual LGU shall be
released directly to the LGU concerned;
Provided further that the individual LGSEF shares to LGUs are used in
accordance with the general purposes and guidelines promulgated by the
OCD for the implementation of the LGSEF at the local levels pursuant to Res.
No. OCD-99-006 dated October 7, 1999 and pursuant to the Leagues'
guidelines and mechanism as approved by the OCD;
Provided further that each of the Leagues shall submit to the OCD for its
approval their respective allocation scheme, the list of LGUs with the
corresponding LGSEF shares and the corresponding project categories if
project-based;

one billion pesos of the LGSEF was to be released in accordance with

paragraph 1 of Resolution No. OCD-2000-23, to complete the 3.5 billion
pesos allocated to the LGUs, while the amount of 1.5 billion pesos was
allocated for the LAAP. However, out of the latter amount, P400,000,000 was
to be allocated and released as follows: P50,000,000 as financial assistance
to the LAAPs of LGUs; P275,360,227 as financial assistance to cover the
decrease in the IRA of LGUs concerned due to reduction in land area; and
P74,639,773 for the LGSEF Capability-Building Fund.
The LGSEF in the GAA of 2001
In view of the failure of Congress to enact the general appropriations law for
2001, the GAA of 2000 was deemed re-enacted, together with the IRA of the
LGUs therein and the proviso earmarking five billion pesos thereof for the
LGSEF.
On January 9, 2002, the Oversight Committee adopted Resolution No. OCD2002-001 allocating the five billion pesos LGSEF for 2001 as follows:
Modified Codal Formula

P 3.000 billion

Priority Projects

1.900 billion

Capability Building Fund

.100 billion
P 5.000 billion

Provided further that upon approval by the OCD, the lists of LGUs shall be
endorsed to the DBM as the basis for the preparation of the corresponding
NCAs, SAROs, and related budget/release documents.
2. The remaining P1,500,000,000 of the CY 2000 LGSEF shall be earmarked
to support the following initiatives and local affirmative action projects, to be
endorsed to and approved by the Oversight Committee on Devolution in
accordance with the OCD agreements, guidelines, procedures and
documentary requirements:
On July 5, 2000, then President Estrada issued a Memorandum authorizing
then Executive Secretary Zamora and the DBM to implement and release the
2.5 billion pesos LGSEF for 2000 in accordance with Resolution No. OCD2000-023.
Thereafter, the Oversight Committee, now under the administration of
President Gloria Macapagal-Arroyo, promulgated Resolution No. OCD-200129 entitled "ADOPTING RESOLUTION NO. OCD-2000-023 IN THE
ALLOCATION, IMPLEMENTATION AND RELEASE OF THE REMAINING
P2.5 BILLION LGSEF FOR CY 2000." Under this resolution, the amount of

RESOLVED FURTHER, that the P3.0 B of the CY 2001 LGSEF which is to

be allocated according to the modified codal formula shall be released to the
four levels of LGUs, i.e., provinces, cities, municipalities and barangays, as
follows:
LGUs

Percentage

Amount

Provinces

25

P 0.750 billion

Cities

25

0.750

Municipalities

35

1.050

Barangays

15

0.450

100

P 3.000 billion

RESOLVED FURTHER, that the P1.9 B earmarked for priority projects shall
be distributed according to the following criteria:

1.0 For projects of the 4th, 5th and 6th class LGUs; or
2.0 Projects in consonance with the President's State of the Nation Address
(SONA)/summit commitments.
RESOLVED FURTHER, that the remaining P100 million LGSEF capability
building fund shall be distributed in accordance with the recommendation of
the Leagues of Provinces, Cities, Municipalities and Barangays, and
approved by the OCD.
Upon receipt of a copy of the above resolution, Gov. Mandanas wrote to the
individual members of the Oversight Committee seeking the reconsideration
of Resolution No. OCD-2002-001. He also wrote to Pres. Macapagal-Arroyo
urging her to disapprove said resolution as it violates the Constitution and the
Local Government Code of 1991.
On January 25, 2002, Pres. Macapagal-Arroyo approved Resolution No.
OCD-2002-001.
The Petitioner's Case
The petitioner now comes to this Court assailing as unconstitutional and void
the provisos in the GAAs of 1999, 2000 and 2001, relating to the LGSEF.
Similarly assailed are the Oversight Committee's Resolutions Nos. OCD-99003, OCD-99-005, OCD-99-006, OCD-2000-023, OCD-2001-029 and OCD2002-001 issued pursuant thereto. The petitioner submits that the assailed
provisos in the GAAs and the OCD resolutions, insofar as they earmarked the
amount of five billion pesos of the IRA of the LGUs for 1999, 2000 and 2001
for the LGSEF and imposed conditions for the release thereof, violate the
Constitution and the Local Government Code of 1991.
Section 6, Article X of the Constitution is invoked as it mandates that the "just
share" of the LGUs shall be automatically released to them. Sections 18 and
286 of the Local Government Code of 1991, which enjoin that the "just share"
of the LGUs shall be "automatically and directly" released to them "without
need of further action" are, likewise, cited.
The petitioner posits that to subject the distribution and release of the fivebillion-peso portion of the IRA, classified as the LGSEF, to compliance by the
LGUs with the implementing rules and regulations, including the mechanisms
and guidelines prescribed by the Oversight Committee, contravenes the
explicit directive of the Constitution that the LGUs' share in the national taxes
"shall be automatically released to them." The petitioner maintains that the
use of the word "shall" must be given a compulsory meaning.
To further buttress this argument, the petitioner contends that to vest the

Oversight Committee with the authority to determine the distribution and

release of the LGSEF, which is a part of the IRA of the LGUs, is an anathema
to the principle of local autonomy as embodied in the Constitution and the
Local Government Code of 1991. The petitioner cites as an example the
experience in 2001 when the release of the LGSEF was long delayed
because the Oversight Committee was not able to convene that year and no
guidelines were issued therefor. Further, the possible disapproval by the
Oversight Committee of the project proposals of the LGUs would result in the
diminution of the latter's share in the IRA.
Another infringement alleged to be occasioned by the assailed OCD
resolutions is the improper amendment to Section 285 of the Local
Government Code of 1991 on the percentage sharing of the IRA among the
LGUs. Said provision allocates the IRA as follows: Provinces 23%; Cities
8
23%; Municipalities 34%; and Barangays 20%. This formula has been
improperly amended or modified, with respect to the five-billion-peso portion
of the IRA allotted for the LGSEF, by the assailed OCD resolutions as they
invariably provided for a different sharing scheme.
The modifications allegedly constitute an illegal amendment by the executive
branch of a substantive law. Moreover, the petitioner mentions that in the
Letter dated December 5, 2001 of respondent Executive Secretary Romulo
addressed to respondent Secretary Boncodin, the former endorsed to the
latter the release of funds to certain LGUs from the LGSEF in accordance
with the handwritten instructions of President Arroyo. Thus, the LGUs are at a
loss as to how a portion of the LGSEF is actually allocated. Further, there are
still portions of the LGSEF that, to date, have not been received by the
petitioner; hence, resulting in damage and injury to the petitioner.
The petitioner prays that the Court declare as unconstitutional and void the
assailed provisos relating to the LGSEF in the GAAs of 1999, 2000 and 2001
and the assailed OCD resolutions (Resolutions Nos. OCD-99-003, OCD-99005, OCD-99-006, OCD-2000-023, OCD-2001-029 and OCD-2002-001)
issued by the Oversight Committee pursuant thereto. The petitioner, likewise,
prays that the Court direct the respondents to rectify the unlawful and illegal
distribution and releases of the LGSEF for the aforementioned years and
release the same in accordance with the sharing formula under Section 285
of the Local Government Code of 1991. Finally, the petitioner urges the Court
to declare that the entire IRA should be released automatically without further
action by the LGUs as required by the Constitution and the Local
Government Code of 1991.
The Respondents' Arguments
The respondents, through the Office of the Solicitor General, urge the Court
to dismiss the petition on procedural and substantive grounds. On the latter,

the respondents contend that the assailed provisos in the GAAs of 1999,
2000 and 2001 and the assailed resolutions issued by the Oversight
Committee are not constitutionally infirm. The respondents advance the view
that Section 6, Article X of the Constitution does not specify that the "just
share" of the LGUs shall be determined solely by the Local Government
Code of 1991. Moreover, the phrase "as determined by law" in the same
constitutional provision means that there exists no limitation on the power of
Congress to determine what is the "just share" of the LGUs in the national
taxes. In other words, Congress is the arbiter of what should be the "just
share" of the LGUs in the national taxes.
The respondents further theorize that Section 285 of the Local Government
Code of 1991, which provides for the percentage sharing of the IRA among
the LGUs, was not intended to be a fixed determination of their "just share" in
the national taxes. Congress may enact other laws, including appropriations
laws such as the GAAs of 1999, 2000 and 2001, providing for a different
sharing formula. Section 285 of the Local Government Code of 1991 was
merely intended to be the "default share" of the LGUs to do away with the
need to determine annually by law their "just share." However, the LGUs
have no vested right in a permanent or fixed percentage as Congress may
increase or decrease the "just share" of the LGUs in accordance with what it
believes is appropriate for their operation. There is nothing in the Constitution
which prohibits Congress from making such determination through the
appropriations laws. If the provisions of a particular statute, the GAA in this
case, are within the constitutional power of the legislature to enact, they
should be sustained whether the courts agree or not in the wisdom of their
enactment.
On procedural grounds, the respondents urge the Court to dismiss the
petition outright as the same is defective. The petition allegedly raises factual
issues which should be properly threshed out in the lower courts, not this
Court, not being a trier of facts. Specifically, the petitioner's allegation that
there are portions of the LGSEF that it has not, to date, received, thereby
causing it (the petitioner) injury and damage, is subject to proof and must be
substantiated in the proper venue, i.e., the lower courts.
Further, according to the respondents, the petition has already been rendered
moot and academic as it no longer presents a justiciable controversy. The
IRAs for the years 1999, 2000 and 2001, have already been released and the
government is now operating under the 2003 budget. In support of this, the
respondents submitted certifications issued by officers of the DBM attesting
to the release of the allocation or shares of the petitioner in the LGSEF for
1999, 2000 and 2001. There is, therefore, nothing more to prohibit.
Finally, the petitioner allegedly has no legal standing to bring the suit because
it has not suffered any injury. In fact, the petitioner's "just share" has even

increased. Pursuant to Section 285 of the Local Government Code of 1991,

the share of the provinces is 23%. OCD Nos. 99-005, 99-006 and 99-003
gave the provinces 40% of P2 billion of the LGSEF. OCD Nos. 2000-023 and
2001-029 apportioned 26% of P3.5 billion to the provinces. On the other
hand, OCD No. 2001-001 allocated 25% of P3 billion to the provinces. Thus,
the petitioner has not suffered any injury in the implementation of the assailed
provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions.
The Ruling of the Court Procedural Issues
Before resolving the petition on its merits, the Court shall first rule on the
following procedural issues raised by the respondents: (1) whether the
petitioner has legal standing or locus standi to file the present suit; (2)
whether the petition involves factual questions that are properly cognizable by
the lower courts; and (3) whether the issue had been rendered moot and
academic.
The petitioner has locus standi to maintain the present suit
The gist of the question of standing is whether a party has "alleged such a
personal stake in the outcome of the controversy as to assure that concrete
adverseness which sharpens the presentation of issues upon which the court
9
so largely depends for illumination of difficult constitutional questions."
Accordingly, it has been held that the interest of a party assailing the
constitutionality of a statute must be direct and personal. Such party must be
able to show, not only that the law or any government act is invalid, but also
that he has sustained or is in imminent danger of sustaining some direct
injury as a result of its enforcement, and not merely that he suffers thereby in
some indefinite way. It must appear that the person complaining has been or
is about to be denied some right or privilege to which he is lawfully entitled or
that he is about to be subjected to some burdens or penalties by reason of
10
the statute or act complained of.
The Court holds that the petitioner possesses the requisite standing to
maintain the present suit. The petitioner, a local government unit, seeks relief
in order to protect or vindicate an interest of its own, and of the other LGUs.
This interest pertains to the LGUs' share in the national taxes or the IRA. The
petitioner's constitutional claim is, in substance, that the assailed provisos in
the GAAs of 1999, 2000 and 2001, and the OCD resolutions contravene
Section 6, Article X of the Constitution, mandating the "automatic release" to
the LGUs of their share in the national taxes. Further, the injury that the
petitioner claims to suffer is the diminution of its share in the IRA, as provided
under Section 285 of the Local Government Code of 1991, occasioned by the
implementation of the assailed measures. These allegations are sufficient to
grant the petitioner standing to question the validity of the assailed provisos in
the GAAs of 1999, 2000 and 2001, and the OCD resolutions as the petitioner

clearly has "a plain, direct and adequate interest" in the manner and
distribution of the IRA among the LGUs.
The petition involves a significant legal issue
The crux of the instant controversy is whether the assailed provisos
contained in the GAAs of 1999, 2000 and 2001, and the OCD resolutions
infringe the Constitution and the Local Government Code of 1991. This is
undoubtedly a legal question. On the other hand, the following facts are not
disputed:
1. The earmarking of five billion pesos of the IRA for the LGSEF in the
assailed provisos in the GAAs of 1999, 2000 and re-enacted budget for 2001;
2. The promulgation of the assailed OCD resolutions providing for the
allocation schemes covering the said five billion pesos and the implementing
rules and regulations therefor; and
3. The release of the LGSEF to the LGUs only upon their compliance with the
implementing rules and regulations, including the guidelines and
mechanisms, prescribed by the Oversight Committee.
Considering that these facts, which are necessary to resolve the legal
question now before this Court, are no longer in issue, the same need not be
11
determined by a trial court. In any case, the rule on hierarchy of courts will
not prevent this Court from assuming jurisdiction over the petition. The said
rule may be relaxed when the redress desired cannot be obtained in the
appropriate courts or where exceptional and compelling circumstances justify
availment of a remedy within and calling for the exercise of this Court's
12
primary jurisdiction.
The crucial legal issue submitted for resolution of this Court entails the proper
legal interpretation of constitutional and statutory provisions. Moreover, the
"transcendental importance" of the case, as it necessarily involves the
application of the constitutional principle on local autonomy, cannot be
gainsaid. The nature of the present controversy, therefore, warrants the
relaxation by this Court of procedural rules in order to resolve the case
forthwith.
The substantive issue needs to be resolved notwithstanding the supervening
events
Granting arguendo that, as contended by the respondents, the resolution of
the case had already been overtaken by supervening events as the IRA,
including the LGSEF, for 1999, 2000 and 2001, had already been released
and the government is now operating under a new appropriations law, still,

there is compelling reason for this Court to resolve the substantive issue
raised by the instant petition. Supervening events, whether intended or
accidental, cannot prevent the Court from rendering a decision if there is a
13
grave violation of the Constitution. Even in cases where supervening events
had made the cases moot, the Court did not hesitate to resolve the legal or
constitutional issues raised to formulate controlling principles to guide the
14
bench, bar and public.
Another reason justifying the resolution by this Court of the substantive issue
now before it is the rule that courts will decide a question otherwise moot and
15
academic if it is "capable of repetition, yet evading review." For the GAAs in
the coming years may contain provisos similar to those now being sought to
be invalidated, and yet, the question may not be decided before another GAA
is enacted. It, thus, behooves this Court to make a categorical ruling on the
substantive issue now.
Substantive Issue
As earlier intimated, the resolution of the substantive legal issue in this case
calls for the application of a most important constitutional policy and principle,
16
that of local autonomy. In Article II of the Constitution, the State has
expressly adopted as a policy that:
Section 25. The State shall ensure the autonomy of local governments.
An entire article (Article X) of the Constitution has been devoted to
guaranteeing and promoting the autonomy of LGUs. Section 2 thereof
reiterates the State policy in this wise:
Section 2. The territorial and political subdivisions shall enjoy local autonomy.
Consistent with the principle of local autonomy, the Constitution confines the
17
President's power over the LGUs to one of general supervision. This
provision has been interpreted to exclude the power of control. The distinction
18
between the two powers was enunciated in Drilon v. Lim:
An officer in control lays down the rules in the doing of an act. If they are not
followed, he may, in his discretion, order the act undone or re-done by his
subordinate or he may even decide to do it himself. Supervision does not
cover such authority. The supervisor or superintendent merely sees to it that
the rules are followed, but he himself does not lay down such rules, nor does
he have the discretion to modify or replace them. If the rules are not
observed, he may order the work done or re-done but only to conform to the
prescribed rules. He may not prescribe his own manner for doing the act. He
has no judgment on this matter except to see to it that the rules are
19
followed.

20

The Local Government Code of 1991 was enacted to flesh out the mandate
21
of the Constitution. The State policy on local autonomy is amplified in
Section 2 thereof:
Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State
that the territorial and political subdivisions of the State shall enjoy genuine
and meaningful local autonomy to enable them to attain their fullest
development as self-reliant communities and make them more effective
partners in the attainment of national goals. Toward this end, the State shall
provide for a more responsive and accountable local government structure
instituted through a system of decentralization whereby local government
units shall be given more powers, authority, responsibilities, and resources.
The process of decentralization shall proceed from the National Government
to the local government units.
Guided by these precepts, the Court shall now determine whether the
assailed provisos in the GAAs of 1999, 2000 and 2001, earmarking for each
corresponding year the amount of five billion pesos of the IRA for the LGSEF
and the OCD resolutions promulgated pursuant thereto, transgress the
Constitution and the Local Government Code of 1991.
The assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD
resolutions violate the constitutional precept on local autonomy
Section 6, Article X of the Constitution reads:
Sec. 6. Local government units shall have a just share, as determined by law,
in the national taxes which shall be automatically released to them.
When parsed, it would be readily seen that this provision mandates that (1)
the LGUs shall have a "just share" in the national taxes; (2) the "just share"
shall be determined by law; and (3) the "just share" shall be automatically
released to the LGUs.
The Local Government Code of 1991, among its salient provisions,
underscores the automatic release of the LGUs' "just share" in this wise:
Sec. 18. Power to Generate and Apply Resources. Local government units
shall have the power and authority to establish an organization that shall be
responsible for the efficient and effective implementation of their development
plans, program objectives and priorities; to create their own sources of
revenue and to levy taxes, fees, and charges which shall accrue exclusively
for their use and disposition and which shall be retained by them; to have a
just share in national taxes which shall be automatically and directly released
to them without need of further action;

...
Sec. 286. Automatic Release of Shares. (a) The share of each local
government unit shall be released, without need of any further action, directly
to the provincial, city, municipal or barangay treasurer, as the case may be,
on a quarterly basis within five (5) days after the end of each quarter, and
which shall not be subject to any lien or holdback that may be imposed by the
national government for whatever purpose.
(b) Nothing in this Chapter shall be understood to diminish the share of local
government units under existing laws.
Webster's Third New International Dictionary defines "automatic" as
"involuntary either wholly or to a major extent so that any activity of the will is
largely negligible; of a reflex nature; without volition; mechanical; like or
suggestive of an automaton." Further, the word "automatically" is defined as
"in an automatic manner: without thought or conscious intention." Being
"automatic," thus, connotes something mechanical, spontaneous and
perfunctory. As such, the LGUs are not required to perform any act to receive
the "just share" accruing to them from the national coffers. As emphasized by
the Local Government Code of 1991, the "just share" of the LGUs shall be
released to them "without need of further action." Construing Section 286 of
22
the LGC, we held in Pimentel, Jr. v. Aguirre, viz:
Section 4 of AO 372 cannot, however, be upheld. A basic feature of local
fiscal autonomy is the automatic release of the shares of LGUs in the
National internal revenue. This is mandated by no less than the Constitution.
The Local Government Code specifies further that the release shall be made
directly to the LGU concerned within five (5) days after every quarter of the
year and "shall not be subject to any lien or holdback that may be imposed by
the national government for whatever purpose." As a rule, the term "SHALL"
is a word of command that must be given a compulsory meaning. The
provision is, therefore, IMPERATIVE.
Section 4 of AO 372, however, orders the withholding, effective January 1,
1998, of 10 percent of the LGUs' IRA "pending the assessment and
evaluation by the Development Budget Coordinating Committee of the
emerging fiscal situation" in the country. Such withholding clearly contravenes
the Constitution and the law. Although temporary, it is equivalent to a
holdback, which means "something held back or withheld, often temporarily."
Hence, the "temporary" nature of the retention by the national government
does not matter. Any retention is prohibited.
In sum, while Section 1 of AO 372 may be upheld as an advisory effected in
times of national crisis, Section 4 thereof has no color of validity at all. The
latter provision effectively encroaches on the fiscal autonomy of local

governments. Concededly, the President was well-intentioned in issuing his

Order to withhold the LGUs' IRA, but the rule of law requires that even the
best intentions must be carried out within the parameters of the Constitution
and the law. Verily, laudable purposes must be carried out by legal
23
methods.
The "just share" of the LGUs is incorporated as the IRA in the appropriations
law or GAA enacted by Congress annually. Under the assailed provisos in
the GAAs of 1999, 2000 and 2001, a portion of the IRA in the amount of five
billion pesos was earmarked for the LGSEF, and these provisos imposed the
condition that "such amount shall be released to the local government units
subject to the implementing rules and regulations, including such
mechanisms and guidelines for the equitable allocations and distribution of
said fund among local government units subject to the guidelines that may be
prescribed by the Oversight Committee on Devolution." Pursuant thereto, the
Oversight Committee, through the assailed OCD resolutions, apportioned the
five billion pesos LGSEF such that:
For 1999
P2 billion - allocated according to Sec. 285 LGC
P2 billion - Modified Sharing Formula (Provinces 40%;
Cities 20%; Municipalities 40%)
P1 billion projects (LAAP) approved by OCD.

24

For 2000
P3.5 billion Modified Sharing Formula (Provinces 26%;
Cities 23%; Municipalities 35%; Barangays 16%);
P1.5 billion projects (LAAP) approved by the OCD.

25

For 2001
P3 billion Modified Sharing Formula (Provinces 25%;
Cities 25%; Municipalities 35%; Barangays 15%)
P1.9 billion priority projects
P100 million capability building fund.

26

Significantly, the LGSEF could not be released to the LGUs without the
Oversight Committee's prior approval. Further, with respect to the portion of
the LGSEF allocated for various projects of the LGUs (P1 billion for 1999;
P1.5 billion for 2000 and P2 billion for 2001), the Oversight Committee,
through the assailed OCD resolutions, laid down guidelines and mechanisms
that the LGUs had to comply with before they could avail of funds from this
portion of the LGSEF. The guidelines required (a) the LGUs to identify the
projects eligible for funding based on the criteria laid down by the Oversight
Committee; (b) the LGUs to submit their project proposals to the DILG for
appraisal; (c) the project proposals that passed the appraisal of the DILG to
be submitted to the Oversight Committee for review, evaluation and approval.
It was only upon approval thereof that the Oversight Committee would direct
the DBM to release the funds for the projects.
To the Court's mind, the entire process involving the distribution and release
of the LGSEF is constitutionally impermissible. The LGSEF is part of the IRA
or "just share" of the LGUs in the national taxes. To subject its distribution
and release to the vagaries of the implementing rules and regulations,
including the guidelines and mechanisms unilaterally prescribed by the
Oversight Committee from time to time, as sanctioned by the assailed
provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions,
makes the release not automatic, a flagrant violation of the constitutional and
statutory mandate that the "just share" of the LGUs "shall be automatically
released to them." The LGUs are, thus, placed at the mercy of the Oversight
Committee.
Where the law, the Constitution in this case, is clear and unambiguous, it
must be taken to mean exactly what it says, and courts have no choice but to
27
see to it that the mandate is obeyed. Moreover, as correctly posited by the
petitioner, the use of the word "shall" connotes a mandatory order. Its use in
a statute denotes an imperative obligation and is inconsistent with the idea of
28
discretion.
Indeed, the Oversight Committee exercising discretion, even control, over the
distribution and release of a portion of the IRA, the LGSEF, is an anathema to
and subversive of the principle of local autonomy as embodied in the
Constitution. Moreover, it finds no statutory basis at all as the Oversight
Committee was created merely to formulate the rules and regulations for the
efficient and effective implementation of the Local Government Code of 1991
to ensure "compliance with the principles of local autonomy as defined under
29
the Constitution." In fact, its creation was placed under the title of
"Transitory Provisions," signifying its ad hoc character. According to Senator
Aquilino Q. Pimentel, the principal author and sponsor of the bill that
eventually became Rep. Act No. 7160, the Committee's work was supposed
30
to be done a year from the approval of the Code, or on October 10, 1992.
The Oversight Committee's authority is undoubtedly limited to the

implementation of the Local Government Code of 1991, not to supplant or

subvert the same. Neither can it exercise control over the IRA, or even a
portion thereof, of the LGUs.

MR. MAAMBONG. Also, this provision on "automatic release of national tax

share" points to more local autonomy. Is this the intention?
MR. NOLLEDO. Yes, the Commissioner is perfectly right.

That the automatic release of the IRA was precisely intended to guarantee
and promote local autonomy can be gleaned from the discussion below
between Messrs. Jose N. Nolledo and Regalado M. Maambong, then
members of the 1986 Constitutional Commission, to wit:
MR. MAAMBONG. Unfortunately, under Section 198 of the Local
Government Code, the existence of subprovinces is still acknowledged by the
law, but the statement of the Gentleman on this point will have to be taken up
probably by the Committee on Legislation. A second point, Mr. Presiding
Officer, is that under Article 2, Section 10 of the 1973 Constitution, we have a
provision which states:
The State shall guarantee and promote the autonomy of local government
units, especially the barrio, to insure their fullest development as self-reliant
communities.
This provision no longer appears in the present configuration; does this mean
that the concept of giving local autonomy to local governments is no longer
adopted as far as this Article is concerned?
MR. NOLLEDO. No. In the report of the Committee on Preamble, National
Territory, and Declaration of Principles, that concept is included and widened
upon the initiative of Commissioner Bennagen.
MR. MAAMBONG. Thank you for that.
With regard to Section 6, sources of revenue, the creation of sources as
provided by previous law was "subject to limitations as may be provided by
law," but now, we are using the term "subject to such guidelines as may be
fixed by law." In Section 7, mention is made about the "unique, distinct and
exclusive charges and contributions," and in Section 8, we talk about
"exclusivity of local taxes and the share in the national wealth." Incidentally, I
was one of the authors of this provision, and I am very thankful. Does this
indicate local autonomy, or was the wording of the law changed to give more
31
autonomy to the local government units?
MR. NOLLEDO. Yes. In effect, those words indicate also "decentralization"
because local political units can collect taxes, fees and charges subject
merely to guidelines, as recommended by the league of governors and city
mayors, with whom I had a dialogue for almost two hours. They told me that
limitations may be questionable in the sense that Congress may limit and in
effect deny the right later on.

32

The concept of local autonomy was explained in Ganzon v. Court of

33
Appeals in this wise:
As the Constitution itself declares, local autonomy 'means a more responsive
and accountable local government structure instituted through a system of
decentralization.' The Constitution, as we observed, does nothing more than
to break up the monopoly of the national government over the affairs of local
governments and as put by political adherents, to "liberate the local
governments from the imperialism of Manila." Autonomy, however, is not
meant to end the relation of partnership and interdependence between the
central administration and local government units, or otherwise, to usher in a
regime of federalism. The Charter has not taken such a radical step. Local
governments, under the Constitution, are subject to regulation, however
limited, and for no other purpose than precisely, albeit paradoxically, to
enhance self-government.
As we observed in one case, decentralization means devolution of national
administration but not power to the local levels. Thus:
Now, autonomy is either decentralization of administration or decentralization
of power. There is decentralization of administration when the central
government delegates administrative powers to political subdivisions in order
to broaden the base of government power and in the process to make local
governments 'more responsive and accountable' and 'ensure their fullest
development as self-reliant communities and make them more effective
partners in the pursuit of national development and social progress.' At the
same time, it relieves the central government of the burden of managing local
affairs and enables it to concentrate on national concerns. The President
exercises 'general supervision' over them, but only to 'ensure that local affairs
are administered according to law.' He has no control over their acts in the
sense that he can substitute their judgments with his own.
Decentralization of power, on the other hand, involves an abdication of
political power in the [sic] favor of local governments [sic] units declared to be
autonomous. In that case, the autonomous government is free to chart its
own destiny and shape its future with minimum intervention from central
authorities. According to a constitutional author, decentralization of power
amounts to 'self-immolation,' since in that event, the autonomous government
34
becomes accountable not to the central authorities but to its constituency.
Local autonomy includes both administrative and fiscal autonomy. The fairly

35

recent case of Pimentel v. Aguirre is particularly instructive. The Court

declared therein that local fiscal autonomy includes the power of the LGUs to,
inter alia, allocate their resources in accordance with their own priorities:

same section:

Under existing law, local government units, in addition to having

administrative autonomy in the exercise of their functions, enjoy fiscal
autonomy as well. Fiscal autonomy means that local governments have the
power to create their own sources of revenue in addition to their equitable
share in the national taxes released by the national government, as well as
the power to allocate their resources in accordance with their own priorities. It
extends to the preparation of their budgets, and local officials in turn have to
work within the constraints thereof. They are not formulated at the national
level and imposed on local governments, whether they are relevant to local
36
needs and resources or not ...

Provided, That in the event that the national government incurs an

unmanageable public sector deficit, the President of the Philippines is hereby
authorized, upon recommendation of Secretary of Finance, Secretary of
Interior and Local Government and Secretary of Budget and Management,
and subject to consultation with the presiding officers of both Houses of
Congress and the presidents of the liga, to make the necessary adjustments
in the internal revenue allotment of local government units but in no case
shall the allotment be less than thirty percent (30%) of the collection of the
national internal revenue taxes of the third fiscal year preceding the current
fiscal year; Provided, further That in the first year of the effectivity of this
Code, the local government units shall, in addition to the thirty percent (30%)
internal revenue allotment which shall include the cost of devolved functions
for essential public services, be entitled to receive the amount equivalent to
the cost of devolved personnel services.

Further, a basic feature of local fiscal autonomy is the constitutionally

mandated automatic release of the shares of LGUs in the national internal
37
revenue.
Following this ratiocination, the Court in Pimentel struck down as
unconstitutional Section 4 of Administrative Order (A.O.) No. 372 which
ordered the withholding, effective January 1, 1998, of ten percent of the
LGUs' IRA "pending the assessment and evaluation by the Development
Budget Coordinating Committee of the emerging fiscal situation."
In like manner, the assailed provisos in the GAAs of 1999, 2000 and 2001,
and the OCD resolutions constitute a "withholding" of a portion of the IRA.
They put on hold the distribution and release of the five billion pesos LGSEF
and subject the same to the implementing rules and regulations, including the
guidelines and mechanisms prescribed by the Oversight Committee from
time to time. Like Section 4 of A.O. 372, the assailed provisos in the GAAs of
1999, 2000 and 2001 and the OCD resolutions effectively encroach on the
fiscal autonomy enjoyed by the LGUs and must be struck down. They cannot,
therefore, be upheld.

Sec. 284. ...

Thus, from the above provision, the only possible exception to the mandatory
automatic release of the LGUs' IRA is if the national internal revenue
collections for the current fiscal year is less than 40 percent of the collections
of the preceding third fiscal year, in which case what should be automatically
released shall be a proportionate amount of the collections for the current
fiscal year. The adjustment may even be made on a quarterly basis
depending on the actual collections of national internal revenue taxes for the
quarter of the current fiscal year. In the instant case, however, there is no
allegation that the national internal revenue tax collections for the fiscal years
1999, 2000 and 2001 have fallen compared to the preceding three fiscal
years.
Section 285 then specifies how the IRA shall be allocated among the LGUs:

The assailed provisos in the GAAs of 1999, 2000

Sec. 285. Allocation to Local Government Units. The share of local

government units in the internal revenue allotment shall be allocated in the
following manner:

and 2001 and the OCD resolutions cannot amend

(a) Provinces Twenty-three (23%)

Section 285 of the Local Government Code of 1991

(b) Cities Twenty-three percent (23%);

38

Section 284 of the Local Government Code provides that, beginning the
third year of its effectivity, the LGUs' share in the national internal revenue
taxes shall be 40%. This percentage is fixed and may not be reduced except
"in the event the national government incurs an unmanageable public sector
deficit" and only upon compliance with stringent requirements set forth in the

(c) Municipalities Thirty-four (34%); and

(d) Barangays Twenty percent (20%).
However, this percentage sharing is not followed with respect to the five

billion pesos LGSEF as the assailed OCD resolutions, implementing the

assailed provisos in the GAAs of 1999, 2000 and 2001, provided for a
different sharing scheme. For example, for 1999, P2 billion of the LGSEF was
39
allocated as follows: Provinces 40%; Cities 20%; Municipalities 40%.
For 2000, P3.5 billion of the LGSEF was allocated in this manner: Provinces
40
26%; Cities 23%; Municipalities 35%; Barangays 26%. For 2001, P3
billion of the LGSEF was allocated, thus: Provinces 25%; Cities 25%;
41
Municipalities 35%; Barangays 15%.
The respondents argue that this modification is allowed since the Constitution
does not specify that the "just share" of the LGUs shall only be determined by
the Local Government Code of 1991. That it is within the power of Congress
to enact other laws, including the GAAs, to increase or decrease the "just
share" of the LGUs. This contention is untenable. The Local Government
Code of 1991 is a substantive law. And while it is conceded that Congress
may amend any of the provisions therein, it may not do so through
appropriations laws or GAAs. Any amendment to the Local Government
Code of 1991 should be done in a separate law, not in the appropriations law,
because Congress cannot include in a general appropriation bill matters that
42
should be more properly enacted in a separate legislation.
A general appropriations bill is a special type of legislation, whose content is
limited to specified sums of money dedicated to a specific purpose or a
43
separate fiscal unit. Any provision therein which is intended to amend
another law is considered an "inappropriate provision." The category of
"inappropriate provisions" includes unconstitutional provisions and provisions
which are intended to amend other laws, because clearly these kinds of laws
44
have no place in an appropriations bill.
Increasing or decreasing the IRA of the LGUs or modifying their percentage
sharing therein, which are fixed in the Local Government Code of 1991, are
matters of general and substantive law. To permit Congress to undertake
these amendments through the GAAs, as the respondents contend, would be
to give Congress the unbridled authority to unduly infringe the fiscal
autonomy of the LGUs, and thus put the same in jeopardy every year. This,
the Court cannot sanction.
It is relevant to point out at this juncture that, unlike those of 1999, 2000 and
2001, the GAAs of 2002 and 2003 do not contain provisos similar to the
herein assailed provisos. In other words, the GAAs of 2002 and 2003 have
not earmarked any amount of the IRA for the LGSEF. Congress had perhaps
seen fit to discontinue the practice as it recognizes its infirmity. Nonetheless,
as earlier mentioned, this Court has deemed it necessary to make a definitive
ruling on the matter in order to prevent its recurrence in future appropriations
laws and that the principles enunciated herein would serve to guide the
bench, bar and public.

Conclusion
In closing, it is well to note that the principle of local autonomy, while
concededly expounded in greater detail in the present Constitution, dates
back to the turn of the century when President William McKinley, in his
Instructions to the Second Philippine Commission dated April 7, 1900,
ordered the new Government "to devote their attention in the first instance to
the establishment of municipal governments in which the natives of the
Islands, both in the cities and in the rural communities, shall be afforded the
opportunity to manage their own affairs to the fullest extent of which they are
capable, and subject to the least degree of supervision and control in which a
careful study of their capacities and observation of the workings of native
control show to be consistent with the maintenance of law, order and
45
loyalty." While the 1935 Constitution had no specific article on local
autonomy, nonetheless, it limited the executive power over local governments
46
to "general supervision ... as may be provided by law." Subsequently, the
1973 Constitution explicitly stated that "[t]he State shall guarantee and
promote the autonomy of local government units, especially the barangay to
47
ensure their fullest development as self-reliant communities." An entire
article on Local Government was incorporated therein. The present
Constitution, as earlier opined, has broadened the principle of local
autonomy. The 14 sections in Article X thereof markedly increased the
powers of the local governments in order to accomplish the goal of a more
meaningful local autonomy.
Indeed, the value of local governments as institutions of democracy is
48
measured by the degree of autonomy that they enjoy. As eloquently put by
M. De Tocqueville, a distinguished French political writer, "[l]ocal assemblies
of citizens constitute the strength of free nations. Township meetings are to
liberty what primary schools are to science; they bring it within the people's
reach; they teach men how to use and enjoy it. A nation may establish a
system of free governments but without the spirit of municipal institutions, it
49
cannot have the spirit of liberty."
Our national officials should not only comply with the constitutional provisions
on local autonomy but should also appreciate the spirit and liberty upon which
50
these provisions are based.
WHEREFORE, the petition is GRANTED. The assailed provisos in the
General Appropriations Acts of 1999, 2000 and 2001, and the assailed OCD
Resolutions, are declared UNCONSTITUTIONAL.
SO ORDERED.

A.M. No. RTJ-05-1953

December 21, 2009

MAYOR HADJI AMER R. SAMPIANO, SOMER ABDULLAH, SALIC

TAMPUGAO, ANTHONY ABI, SAGA POLE INOG, TORORAC DOMATO,
KING MARONSING, MARGARITA SOLAIMAN, HADJI ACMAD
MAMENTING and BILLIE JAI LAINE T. OGKA, Complainants,
vs.
JUDGE CADER P. INDAR, Acting Presiding Judge, Regional Trial Court,
Branch 12, Malabang, Lanao del Sur, Respondent.
DECISION
LEONARDO-DE CASTRO, J.:
This administrative case against respondent Judge Cader P. Indar of the
Regional Trial Court (RTC), Branch 12, Malabang, Lanao del Sur stemmed
1
from a complaint filed by Hadji Amer R. Sampiano (Sampiano), incumbent
Mayor, and the members of the Sangguniang Bayan of the Municipality of
Balabagan, Lanao del Sur, charging said judge with gross and wanton
ignorance of the law, grave abuse of authority, manifest partiality and serious
2
acts of impropriety in connection with the issuance of an Order dated
3
October 11, 2004 in Special Civil Action (SCA) No. 12-173, entitled
Sumulong Sampiano Ogka (Ogka) v. Philippine National Bank(PNB)-Marawi
Branch, represented by its Branch Manager Sandorie T. Disomangcop
(Disomangcop), Atty. Alvin C. Go (Go), Hadji Amer Sampiano and Mamarinta
Macabato (Macabato), for Prohibition and Injunction with Temporary
Restraining Order (TRO) and Preliminary Injunction.

controversy involving the mayorship of the Municipality of Balabagan.

Aggrieved, Ogka filed, on September 13, 2004, an Urgent Motion for
8
Reconsideration of the September 9, 2004 Order. He also informed in
9
writing, the Chief Legal Counsel of PNB, Atty. Alvin C. Go, and asked him
not to release the IRA (Internal Revenue Allotment which is the share of the
local government unit in national internal revenue taxes) for the Municipality
of Balabagan, Lanao del Sur until the controversy involving the mayorship of
the said municipality now pending with the Comelec shall have been finally
resolved. He cited Section 2, Rule 19 of the Comelec Rules of Procedure
which provides that a motion for reconsideration, if not pro-forma, suspends
the execution or implementation of the decision, resolution, order or ruling.
However, on the basis of the Comelec Order dated September 9, 2004, Go
directed PNB-Marawi to release the July, August, and September 2004 IRA
for the Municipality of Balabagan, Lanao del Sur to Sampiano and Macabato
(the Municipal Treasurer). In turn, PNB-Marawi acting through its manager,
Disomangcop, released on September 14, 2004 the pending IRA for the
months of July to September 2004. To temporarily suspend the release by
the PNB-Marawi of the October 2004 IRA while his Urgent Motion for
Reconsideration of the September 9, 2004 Order of the Comelec is pending
resolution, Ogka filed on October 11, 2004, a special civil action for
10
Prohibition and Injunction with TRO and Preliminary Injunction, docketed as
SCA No. 12-173, with the RTC, Branch 12, Malabang, Lanao del Sur
presided over by herein respondent Judge. The petition contained the
following prayer:
WHEREFORE, all the foregoing premises considered, petitioner thru
counsel, most respectfully prays this Honorable Court that:

The antecedent facts are as follows:

Prior to the filing of the present administrative case, complainant Sampiano
filed before the Commission on Elections (Comelec) a Petition for Annulment
4
of Proclamation with Prayer for Preliminary Injunction/TRO against his rival
mayoralty candidate, his uncle Ogka, and the Municipal Board of Canvassers
of Balabagan, Lanao del Sur composed of Vadria Pungginagina and Zenaida
Mante. The case was docketed as SPC No. 04-285. It appears that the
5
Comelec issued the following: Order dated August 4, 2004 (authorizing the
vice-mayor to temporarily assume the duties and responsibilities as mayor
due to the double proclamation of Sampiano and Ogka for the position of
6
mayor), Order dated August 12, 2004 (recalling the Order authorizing the
assumption of the vice-mayor as the mayor, and instead maintaining the
status quo prevailing at the time of the issuance of the said Order), and
7
Order dated September 9, 2004 (clarifying the Order of August 12, 2004).
Pursuant to the said Orders, Sampiano was ordered to act, perform and
discharge the duties, functions and responsibilities as mayor "to prevent
paralysis to public service" pending determination and final resolution of the

(1) Considering the urgency of the subject matter of the petition, a temporary
restraining order (TRO) be immediately issued upon the filing of this petition
ORDERING
(a) respondent Atty. Alvin C. Go to cease and desist from issuing an order
ordering the respondent PNB-Marawi Branch manager Sandorie T.
Disomangcop to release the October 2004 IRA and the months thereafter to
respondents Hadji Amer Sampiano and Mamarinta Macabato or their agents
or persons acting for and in their behalves,
(b) respondent PNB-Marawi thru Sandorie T. Disomangcop to cease and
desist from accepting and honoring any withdrawal check(s) for the October
2004 IRA of Balabagan signed by respondents Hadji Amer Sampiano and
Mamarinta Macabato and or releasing the October 2004 IRA for Balabagan,
Lanao del Sur to respondents Mamarinta Macabato and Hadji Amer
Sampiano or their agents or persons acting for and in their behalves, and

(c) respondents Hadji Amer Sampiano and Mamarinta Macabato including

their agents or persons acting for and in their behalves to cease and desist
from withdrawing/releasing the October 2004 IRA for Balabagan, Lanao del
Sur from the respondent PNB-Marawi; and
(2) After, notice and hearing, a writ of preliminary injunction (WPI) be issued
against the respondents including the persons acting for and in their
behalves under the same terms and conditions as the TRO for a period
lasting until the petition in SPC No. 04-285 pending before the Comelec shall
11
have been finally decided.
On the same day, respondent Judge issued an Order setting the hearing of
the petition on October 14, 2004. He likewise directed, pending resolution of
the said petition, the PNB-Marawi (represented by Disomangcop and Go) to
hold or defer the release of the IRA for the Municipality of Balabagan unless
ordered otherwise by the court, thus:
xxx

xxx

xxx

In the meantime, considering that the urgency of the Petitioner (sic) and
while the petition is pending resolution of the Court, the Philippine National
Bank represented by its Branch Manager Sandorie T. Disomangcop and
Atty. Alvic C. Go, are hereby ordered to hold or defer the release of the
Internal Revenue Allotment (IRA) intended for the Municipal Government of
12
Balabagan unless ordered otherwise by this Court.
Sampiano also alleged that during the October 14, 2004 hearing, his counsel
clarified with respondent Judge if the October 11, 2004 Order was in the
nature of a TRO. Respondent Judge replied that it was not. His counsel then
vigorously prodded respondent Judge to immediately lift the said Order so as
not to deprive the officials and employees of the Municipality of Balabagan
from receiving their hard earned salaries, but respondent Judge did not heed
13
the said request. As manifested during the said hearing, Sampiano and
Macabato through counsel filed their Motion to Dismiss the petition (SCA No.
12-173) on October 19, 2004. In the said motion, they prayed not only for the
dismissal of the said petition for lack of jurisdiction over the subject matter
and for failure to state a cause of action, but also for the lifting of the October
14
11, 2004 Order.
Sampiano considered the October 11, 2004 Order as a "SUPER ORDER"
because it was not only issued ex-parte but also it directed the PNB-Marawi
to hold or defer the release of the IRA "until ordered otherwise by [the] court."
He likened the said Order to a TRO and a writ of preliminary injunction, and
insisted that in both instances, prior notice and hearing are required. He
added that a TRO has a limited life of twenty (20) days while a writ of
preliminary injunction is effective only during the pendency of the case and

only after posting the required injunction bond. Sampiano further claimed that
the said Order was issued in violation of Section 286 of the Local
Government Code (LGC), which provides for the automatic release of the
15
share of the local government unit from the national government. Sampiano
prayed that respondent Judge be dismissed from judicial service for gross
ignorance of the law, grave abuse of authority, manifest partiality and serious
acts of impropriety for the following reasons:
1. Assumption of jurisdiction over SCA 12-173 the subject matter of which
concerns the enforcement of election laws by the Comelec; and
2. Ex-parte issuance of the October 11, 2004 order freezing the IRA of the
Municipality of Balabagan "unless ordered otherwise by the Court."
By 1st Indorsement of November 8, 2004, then Court Administrator
Presbitero J. Velasco, Jr. (now Supreme Court Associate Justice) required
respondent Judge to file his comment and to show cause why no disciplinary
action should be taken against him for violation of his professional
16
responsibility as a lawyer.
17

In his Comment dated December 24, 2004, respondent Judge denied the
charges against him and prayed for the dismissal of the complaint. His
explanation as summarized by the OCA is as follows:
xxx He believed that he could not be administratively sanctioned as he did
not commit any administrative lapses. His court assumed jurisdiction over
[SCA] No. 12-173 as it is a petition for prohibition and injunction and not an
enforcement of election laws. While he considered the said petition as an
improper remedy, hence, the court should not have taken cognizance of the
case, he had nevertheless acted on it since the petition prays for the
issuance of temporary restraining order and preliminary injunction, both an
auxiliary remedy which concerns the "enforcement of legal right or a matter
that partakes of a question of law" and not the enforcement of election laws.
Considering the urgency of the petition and before granting the prayer for the
issuance of the TRO, he immediately issued an order on October 11, 2004,
which defer or hold the release of the Internal Revenue Allotment (IRA)
pending resolution of the petition by the court and thereafter set the hearing
of the petition on October 14, 2004. Respondent emphasized that the
October 11, 2004 order DID NOT FREEZE the IRA but merely HELD or
DEFERRED its release to any person including petitioner Sumulong
Sampiano Ogka (who is the complainants uncle), a party to the election case
who also holds [a] "COMELEC proclamation" as duly elected mayor of
Balabagan. Said proclamation was neither annulled nor invalidated by the
COMELEC pending resolution of the petitioner Ogkas Motion for
Reconsideration of the above-mentioned three (3) orders. Since petitioner

Ogka was left with no alternative to protect his interest in the IRA and to
prevent irreparable injury, he filed the instant petition with the prayer for the
issuance of TRO and preliminary injunction.
The main issue in petitioner Ogkas petition is the determination of whether
petitioner is entitled to the issuance of TRO and later, a permanent injunction
to hold the release of the IRA to Hadji R. Sampiano or to any person acting in
his behalf considering that petitioner is also a holder of [a] "COMELEC"
proclamation.
There is no question that the COMELEC is vested under the Constitution
with the enforcement of election laws. However, he [respondent] did not
arrogate upon himself such power as he neither contracted nor annulled any
order of the COMELEC. Under Section 21 of B.P. 129, the RTC has
exclusive original jurisdiction in the issuance of writ of prohibition and
injunction. Hence, he simply applied Rule 58 of the Rules of Court, which is
the prevailing rule applicable in determining the merits of the subject petition.
He did not require petitioner to post a bond because the 11 October 2004
Order is a mere "initiatory" action necessary to determine whether it warrants
the issuance of the TRO and preliminary injunction. It is only after such
determination that the posting of bond is required. His careful actions are
supposed to be considered as an exercise of judicial function and judicial
prerogatives.
Moreover, he was also cautious in his actions to avert the already growing
tension between the warring families newly aroused by the result of the May
10, 2004 election. Hence, he has to relax the application of the rules and
harmonize it with the temperament of the protagonists who are Maranaos
belonging to the same family clan.
Concerning the alleged violation of the pertinent provision of the Local
Government Code, respondent believes that the provision on the automatic
release of IRA is not a shield or immunity to the authority of the courts to
interfere, interrupt or suspend its release when there is a legal question
presented before it in order to determine the rights of the parties concerned.
Lastly, respondent was not able to continue handling the subject case,
particularly the complainants motion to dismiss save the issuance of an
order requiring petitioner Ogka to file his comment to the said motion
considering that he was already relieved of his duties and responsibilities as
presiding judge of RTC, Branch 12, Malabang pursuant to Administrative
Order No. 154-2004 designating and assigning him on permanent detail in all
the branches of the RTC, Cotabato City. Hence, it was already the new
acting judge in the person of Hon. Rasad G. Balindong who proceeded with
the hearing of the subject petition. Upon verification, he learned that Judge
Balindong had already issued an order dated 25 November 2004 dismissing

the subject petition.

Considering all of the foregoing, respondent prays for the immediate
dismissal of the instant complaint for being preposterous so that he can
concentrate on his judicial tasks more important than the instant harassment
18
suit.
The OCA filed with the Court an Administrative Matter for Agenda with the
following recommendation.
RECOMMENDATION: Respectfully submitted for the consideration of the
Honorable Court our recommendation that respondent judge be found guilty
of ignorance of the law for violating Section 5 of Rule 58, Revised Rules on
Civil Procedure and that he be imposed a penalty of FINE in the sum of Ten
19
Thousand (P10,000.00) pesos.
In a Resolution dated September 7, 2005, the Court resolved to re-docket the
case as a regular administrative matter and on December 11, 2006, we
required the parties to manifest, within ten (10) days from notice, whether
they were submitting this case for resolution on the basis of the pleadings
already filed. Both parties failed to comply; hence, we considered the case
submitted for resolution.
We agree with the findings of the OCA that the October 11, 2004 Order is
essentially a preliminary injunction order, and that the respondent Judge
failed to comply with the provisions of Section 5, Rule 58 of the Rules of
Court.
We shall first tackle the question of whether the RTC had acquired
jurisdiction over the petition. It is settled that jurisdiction over the subject
matter on the existence of the action is determined by the material
allegations of the complaint and the law, irrespective of whether or not the
plaintiff is entitled to recover all or some of the claims or relief sought therein.
Such jurisdiction cannot be made to depend upon the defenses set up in the
court or upon a motion to dismiss for, otherwise, the question of jurisdiction
would depend almost entirely on the defendant. Once jurisdiction is vested,
20
the same is retained up to the end of the litigation. In this case, the petition
prayed, among others, that Go should cease and desist from ordering PNBMarawi through its branch manager to release the IRA for the month of
October 2004 and the succeeding months to Sampiano and Macabato or
their agents. The issue here involves the determination of whether Ogka is
entitled to the issuance of a TRO or an injunction and not the application or
enforcement of election law. Undeniably, the RTC has jurisdiction over such
action pursuant to Section 21 of BP 129, which provides:
SEC 21. Original jurisdiction in other cases. - Regional Trial Courts shall

exercise original jurisdiction:

(1) in the issuance of writs of certiorari, prohibition, mandamus, quo
warranto, habeas corpus and injunction which may be enforced in any part of
their respective regions; xxx (italics ours)
Sampianos claim that the October 11, 2004 Order was in contravention of
Section 286 of the LGC on the automatic release of the share of the local
government unit is untenable. We agree with respondent Judge that the
automatic release of the IRA under Section 286 is a mandate to the national
government through the Department of Budget and Management to effect
automatic release of the said funds from the treasury directly to the local
government unit, free from any holdbacks or liens imposed by the national
government. However, this automatic release of the IRA from the national
treasury does not prevent the proper court from deferring or suspending the
release thereof to particular local officials when there is a legal question
presented in the court pertaining to the rights of the parties to receive the IRA
or to the propriety of the issuance of a TRO or a preliminary injunction while
such rights are still being determined.
A cursory reading of the said Order reveals that it was in effect a TRO or
preliminary injunction order. The Order directed PNBs Go and Disomangcop
to hold or defer the release of the IRA to Sampiano and Macabato while the
petition is pending resolution of the trial court and unless ordered otherwise
by the court. This Order was merely consistent with the relief prayed for in
respondents petition for prohibition and injunction.
Section 5, Rule 58 of the Rules of Court provides:
SEC. 5. Preliminary injunction not granted without notice; exception. No
preliminary injunction shall be granted without hearing and prior notice to the
party or person sought to be enjoined. If it shall appear from the facts shown
by the affidavits or by the verified application that great or irreparable injury
would result to the applicant before the matter can be heard on notice, the
court to which the application for preliminary injunction was made, may issue
a temporary restraining order to be effective only for a period of twenty (20)
days from service on the party or person sought to be enjoined, except as
herein provided. Within the said twenty-day period, the court must order said
party or person to show cause, at a specified time and place, why the
injunction should not be granted, determine within the same period whether
or not the preliminary injunction shall be granted, and accordingly issue the
corresponding order (as amended by En Banc Resolution of the Supreme
Court, Bar Matter No. 803, dated February 17, 1998).
However, and subject to the provisions of the preceding sections, if the
matter is of extreme urgency and the applicant will suffer grave injustice and

irreparable injury, the executive judge of a multiple-sala court or the presiding

judge of a single-sala court may issue ex parte a temporary restraining order
effective for only seventy-two (72) hours from issuance but he shall
immediately comply with provisions of the next preceding section as to
service of summons and the documents to be served therewith. Thereafter,
within the aforesaid seventy-two (72) hours, the judge before whom the case
is pending shall conduct a summary hearing to determine whether the
temporary restraining order shall be extended until the application for
preliminary injunction can be heard. In no case shall the total period of the
effectivity of the temporary restraining order exceed twenty (20) days,
including the original seventy-two (72) hours provided therein.
The above-quoted provisions expressly prohibit the grant of preliminary
injunction without hearing and prior notice to the party or person sought to be
enjoined. However, courts are authorized to issue ex parte a TRO effective
only for seventy-two (72) hours if it should appear from the facts shown by
affidavits or by the verified petition that great or irreparable injury would result
to the applicant before the matter could be heard on notice. Within the
aforesaid period of time, the Court should conduct a summary hearing to
determine if a TRO shall be issued. The TRO, however, shall be effective
only for a period of twenty (20) days from notice to the party or person sought
to be enjoined. During the 20-day period, the judge must conduct a hearing
to consider the propriety of issuing a preliminary injunction. At the end of
such period, the TRO automatically terminates without need of any judicial
declaration to that effect, leaving the court no discretion to extend the
21
same.
Here, respondent Judge issued the October 11, 2004 Order on the very
same day it was filed, and without any hearing and prior notice to herein
complainants. As discussed above, respondent was allowed by the Rules to
issue ex parte a TRO of limited effectivity and, in that time, conduct a hearing
to determine the propriety of extending the TRO or issuing a writ of
preliminary injunction.
Respondent conducted the hearing of the petition on October 14, 2004 or on
the third day of the issuance of a TRO ex parte. Atty. Romaraban
Macabantog (Macabantog) and Atty. Tingcap Mortaba (Mortaba) counsels
for Ogka and Sampiano, respectively argued in their clients behalf.
Sampiano and Macabato were also present. During the said hearing, Atty.
Mortaba manifested that his clients would either file an answer or a motion to
dismiss the petition (in SCA No. 12-173), while Atty. Macabantog opted to file
22
a rejoinder after the latter has submitted their answer or motion to dismiss.
On October 19, 2004, Sampiano and Macabato filed a Motion to Dismiss the
petition, wherein, they prayed, among others, for the recall or lifting of the
October 11, 2004 Order. Respondent Judge pointed out that he was able to
make an initial action on the Motion to Dismiss the petition by requiring Ogka

23

to comment on the said motion before turning the case to the incoming
24
Acting Presiding Judge, Judge Rosad B. Balindong, on October 22, 2004.
The October 11, 2004 Order was lifted in an Order dated October 27, 2004
25
issued by the latter. Hence, the TRO issued ex parte was effective for
eleven (11) days from October 11, 2004 until October 22, 2004 in violation of
the Rules. Only a TRO issued after a summary hearing can last for a period
of twenty days.1avvphi1
It is worthy to note that the said October 11, 2004 Order was subsequently
lifted by the succeeding judge on the ground that the requisites for issuance
of a writ of preliminary injunction were not present.
However, Sampiano adduced no evidence to prove that the issuance of the
October 11, 2004 Order was motivated by bad faith. Bad faith does not
simply connote bad judgment or negligence; it imputes a dishonest purpose
or some moral obliquity and conscious doing of a wrong; a breach of a sworn
duty through some motive or intent or ill-will; it partakes of the nature of
fraud. It contemplates a state of mind affirmatively operating with furtive
design or some motive of self-interest or ill-will for ulterior purposes. Evident
bad faith connotes a manifest deliberate intent on the part of the accused to
26
do wrong or cause damage. In issuing the assailed Order, respondent
Judge was not at all motivated by bad faith, dishonesty, hatred and some
other motive; rather, he took into account the circumstances obtaining
between the parties as can be gleaned from his Comment, and we quote:
This should be considered an exercise of judicial functions and judicial
prerogatives in the most cautious manner taking into account the factual and
serious circumstances obtaining between petitioner Ogka and his Uncle
Mayor Sampiano whose family were already at war with each other.
Further, respondent judge was cautious in his court actions in this petition in
order to avert the already growing tension between the warring families
27
aroused anew by the result of the May 10, 2004 elections. xxx
Since there is no showing that respondent Judge was motivated by bad faith
or ill motives in rendering the assailed Order, and this is his first offense, we
sustain the penalty recommended by the OCA to be imposed on respondent
Judge for violating Section 5, Rule 58 of the Rules of Court.
WHEREFORE, the penalty of a fine of Ten Thousand Pesos (P10,000.00) is
hereby imposed on respondent Judge for the above-mentioned violation of
the Rules of Court.
SO ORDERED.

G.R. No. 195770

July 17, 2012

AQUILINO Q. PIMENTEL, JR., SERGIO TADEO and NELSON

ALCANTARA, Petitioners,
vs.
EXECUTIVE SECRETARY PAQUITO N. OCHOA and SECRETARY
CORAZON JULIANO-SOLIMAN OF THE DEPARTMENT OF SOCIAL
WELFARE and DEVELOPMENT (DSWD), Respondents.
DECISION
PERLAS-BERNABE, J.:
The Case
For the Courts consideration in this Petition for Certiorari and Prohibition is
the constitutionality of certain provisions of Republic Act No. 10147 or the
1
General Appropriations Act (GAA) of 2011 which provides a P21 Billion
budget allocation for the Conditional Cash Transfer Program (CCTP) headed
by the Department of Social Welfare & Development (DSWD). Petitioners
seek to enjoin respondents Executive Secretary Paquito N. Ochoa and
DSWD Secretary Corazon Juliano-Soliman from implementing the said
program on the ground that it amounts to a "recentralization" of government
functions that have already been devolved from the national government to
the local government units.

3. To reduce incidence of child labor

4. To raise consumption of poor households on nutrient dense foods
5. To encourage parents to invest in their children's (and their own) future
6. To encourage parent's participation in the growth and development of
6
young children, as well as involvement in the community.
This government intervention scheme, also conveniently referred to as
CCTP, "provides cash grant to extreme poor households to allow the
7
members of the families to meet certain human development goals."
Eligible households that are selected from priority target areas consisting of
the poorest provinces classified by the National Statistical Coordination
8
Board (NCSB) are granted a health assistance of P500.00/month, or
P6,000.00/year, and an educational assistance of P300.00/month for 10
months, or a total of P3,000.00/year, for each child but up to a maximum of
9
three children per family. Thus, after an assessment on the appropriate
assistance package, a household beneficiary could receive from the
government an annual subsidy for its basic needs up to an amount of
P15,000.00, under the following conditionalities:
a) Pregnant women must get pre natal care starting from the 1st trimester,
child birth is attended by skilled/trained professional, get post natal care
thereafter

The Facts
In 2007, the DSWD embarked on a poverty reduction strategy with the
2
poorest of the poor as target beneficiaries. Dubbed "Ahon Pamilyang
Pilipino," it was pre-pilot tested in the municipalities of Sibagat and
Esperanza in Agusan del Sur; the municipalities of Lopez Jaena and
Bonifacio in Misamis Occidental, the Caraga Region; and the cities of Pasay
3
and Caloocan upon the release of the amount of P50 Million Pesos under a
Special Allotment Release Order (SARO) issued by the Department of
4
Budget and Management.
On July 16, 2008, the DSWD issued Administrative Order No. 16, series of
5
2008 (A.O. No. 16, s. 2008), setting the implementing guidelines for the
project renamed "Pantawid Pamilyang Pilipino Program" (4Ps), upon the
following stated objectives, to wit:
1. To improve preventive health care of pregnant women and young children
2. To increase enrollment/attendance of children at elementary level

b) Parents/guardians must attend family planning sessions/mother's class,

Parent Effectiveness Service and others
c) Children 0-5 years of age get regular preventive health check-ups and
vaccines
d) Children 3-5 years old must attend day care program/pre-school
e) Children 6-14 years of age are enrolled in schools and attend at least 85%
10
of the time
Under A.O. No. 16, s. 2008, the DSWD also institutionalized a coordinated
inter-agency network among the Department of Education (DepEd),
Department of Health (DOH), Department of Interior and Local Government
(DILG), the National Anti-Poverty Commission (NAPC) and the local
government units (LGUs), identifying specific roles and functions in order to
ensure effective and efficient implementation of the CCTP. As the DSWD
takes on the role of lead implementing agency that must "oversee and
coordinate the implementation, monitoring and evaluation of the program,"

the concerned LGU as partner agency is particularly tasked to

DELIVERY OF BASIC SERVICES ALREADY DEVOLVED TO THE LGUS.

a. Ensure availability of the supply side on health and education in the target
areas.

Petitioners admit that the wisdom of adopting the CCTP as a poverty

reduction strategy for the Philippines is with the legislature. They take
exception, however, to the manner by which it is being implemented, that is,
primarily through a national agency like DSWD instead of the LGUs to which
the responsibility and functions of delivering social welfare, agriculture and
health care services have been devolved pursuant to Section 17 of Republic
Act No. 7160, also known as the Local Government Code of 1991, in relation
to Section 25, Article II & Section 3, Article X of the 1987 Constitution.

b. Provide necessary technical assistance for Program implementation

c. Coordinate the implementation/operationalization of sectoral activities at
the City/Municipal level to better execute Program objectives and functions
d. Coordinate with various concerned government agencies at the local level,
sectoral representatives and NGO to ensure effective Program
implementation
e. Prepare reports on issues and concerns regarding Program
implementation and submit to the Regional Advisory Committee, and
f. Hold monthly committee meetings

11

12

A Memorandum of Agreement (MOA) executed by the DSWD with each

participating LGU outlines in detail the obligation of both parties during the
intended five-year implementation of the CCTP.
Congress, for its part, sought to ensure the success of the CCTP by
providing it with funding under the GAA of 2008 in the amount of Two
Hundred Ninety-Eight Million Five Hundred Fifty Thousand Pesos
(P298,550,000.00). This budget allocation increased tremendously to P5
Billion Pesos in 2009, with the amount doubling to P10 Billion Pesos in 2010.
But the biggest allotment given to the CCTP was in the GAA of 2011 at
Twenty One Billion One Hundred Ninety-Four Million One Hundred
13
Seventeen Thousand Pesos (P21,194,117,000.00). 1wphi1
Petitioner Aquilino Pimentel, Jr., a former Senator, joined by Sergio Tadeo,
incumbent President of the Association of Barangay Captains of Cabanatuan
City, Nueva Ecija, and Nelson Alcantara, incumbent Barangay Captain of
Barangay Sta. Monica, Quezon City, challenges before the Court the
disbursement of public funds and the implementation of the CCTP which are
alleged to have encroached into the local autonomy of the LGUs.
The Issue
THE P21 BILLION CCTP BUDGET ALLOCATION UNDER THE DSWD IN
THE GAA FY 2011 VIOLATES ART. II, SEC. 25 & ART. X, SEC. 3 OF THE
1987 CONSTITUTION IN RELATION TO SEC. 17 OF THE LOCAL
GOVERNMENT CODE OF 1991 BY PROVIDING FOR THE
RECENTRALIZATION OF THE NATIONAL GOVERNMENT IN THE

Petitioners assert that giving the DSWD full control over the identification of
beneficiaries and the manner by which services are to be delivered or
conditionalities are to be complied with, instead of allocating the P21 Billion
CCTP Budget directly to the LGUs that would have enhanced its delivery of
basic services, results in the "recentralization" of basic government functions,
which is contrary to the precepts of local autonomy and the avowed policy of
decentralization.
Our Ruling
The Constitution declares it a policy of the State to ensure the autonomy of
14
local governments and even devotes a full article on the subject of local
15
governance which includes the following pertinent provisions:
Section 3. The Congress shall enact a local government code which shall
provide for a more responsive and accountable local government structure
instituted through a system of decentralization with effective mechanisms of
recall, initiative, and referendum, allocate among the different local
government units their powers, responsibilities, and resources, and provide
for the qualifications, election, appointment and removal, term, salaries,
powers and functions and duties of local officials, and all other matters
relating to the organization and operation of the local units.
xxx
Section 14. The President shall provide for regional development councils or
other similar bodies composed of local government officials, regional heads
of departments and other government offices, and representatives from nongovernmental organizations within the regions for purposes of administrative
decentralization to strengthen the autonomy of the units therein and to
accelerate the economic and social growth and development of the units in
the region. (Underscoring supplied)
In order to fully secure to the LGUs the genuine and meaningful autonomy
that would develop them into self-reliant communities and effective partners

16

in the attainment of national goals, Section 17 of the Local Government

Code vested upon the LGUs the duties and functions pertaining to the
delivery of basic services and facilities, as follows:
SECTION 17. Basic Services and Facilities.
(a) Local government units shall endeavor to be self-reliant and shall
continue exercising the powers and discharging the duties and functions
currently vested upon them. They shall also discharge the functions and
responsibilities of national agencies and offices devolved to them pursuant to
this Code. Local government units shall likewise exercise such other powers
and discharge such other functions and responsibilities as are necessary,
appropriate, or incidental to efficient and effective provision of the basic
services and facilities enumerated herein.
(b) Such basic services and facilities include, but are not limited to, x x x.
While the aforementioned provision charges the LGUs to take on the
functions and responsibilities that have already been devolved upon them
from the national agencies on the aspect of providing for basic services and
facilities in their respective jurisdictions, paragraph (c) of the same provision
provides a categorical exception of cases involving nationally-funded
projects, facilities, programs and services, thus:
(c) Notwithstanding the provisions of subsection (b) hereof, public works and
infrastructure projects and other facilities, programs and services funded by
the National Government under the annual General Appropriations Act, other
special laws, pertinent executive orders, and those wholly or partially funded
from foreign sources, are not covered under this Section, except in those
cases where the local government unit concerned is duly designated as the
implementing agency for such projects, facilities, programs and services.
(Underscoring supplied)
The essence of this express reservation of power by the national government
is that, unless an LGU is particularly designated as the implementing agency,
it has no power over a program for which funding has been provided by the
national government under the annual general appropriations act, even if the
program involves the delivery of basic services within the jurisdiction of the
LGU.
17

The Court held in Ganzon v. Court of Appeals that while it is through a

system of decentralization that the State shall promote a more responsive
and accountable local government structure, the concept of local autonomy
18
does not imply the conversion of local government units into "mini-states."
We explained that, with local autonomy, the Constitution did nothing more
than "to break up the monopoly of the national government over the affairs of

the local government" and, thus, did not intend to sever "the relation of
partnership and interdependence between the central administration and
19
20
local government units." In Pimentel v. Aguirre, the Court defined the
extent of the local government's autonomy in terms of its partnership with the
national government in the pursuit of common national goals, referring to
such key concepts as integration and coordination. Thus:
Under the Philippine concept of local autonomy, the national government has
not completely relinquished all its powers over local governments, including
autonomous regions. Only administrative powers over local affairs are
delegated to political subdivisions. The purpose of the delegation is to make
governance more directly responsive and effective at the local levels. In turn,
economic, political and social development at the smaller political units are
expected to propel social and economic growth and development. But to
enable the country to develop as a whole, the programs and policies effected
locally must be integrated and coordinated towards a common national goal.
Thus, policy-setting for the entire country still lies in the President and
Congress.
Certainly, to yield unreserved power of governance to the local government
unit as to preclude any and all involvement by the national government in
programs implemented in the local level would be to shift the tide of
monopolistic power to the other extreme, which would amount to a
21
decentralization of power explicated in Limbona v. Mangelin as beyond our
constitutional concept of autonomy, thus:
Now, autonomy is either decentralization of administration or decentralization
of power.1wphi1 There is decentralization of administration when the
central government delegates administrative powers to political subdivisions
in order to broaden the base of government power and in the process to
make local governments more responsive and accountable and ensure
their fullest development as self-reliant communities and make them more
effective partners in the pursuit of national development and social progress.
At the same time, it relieves the central government of the burden of
managing local affairs and enables it to concentrate on national concerns.
The President exercises general supervision over them, but only to ensure
that local affairs are administered according to law. He has no control over
their acts in the sense that he can substitute their judgments with his own.
Decentralization of power, on the other hand, involves an abdication of
political power in the [sic] favor of local governments [sic] units declared to be
autonomous. In that case, the autonomous government is free to chart its
own destiny and shape its future with minimum intervention from central
authorities. According to a constitutional author, decentralization of power
amounts to self-immolation, since in that event, the autonomous
government becomes accountable not to the central authorities but to its

constituency.

22

Indeed, a complete relinquishment of central government powers on the

matter of providing basic facilities and services cannot be implied as the
Local Government Code itself weighs against it. The national government is,
thus, not precluded from taking a direct hand in the formulation and
implementation of national development programs especially where it is
implemented locally in coordination with the LGUs concerned.
Every law has in its favor the presumption of constitutionality, and to justify its
nullification, there must be a clear and unequivocal breach of the
23
Constitution, not a doubtful and argumentative one. Petitioners have failed
to discharge the burden of proving the invalidity of the provisions under the
GAA of 2011. The allocation of a P21 billion budget for an intervention
program formulated by the national government itself but implemented in
partnership with the local government units to achieve the common national
goal development and social progress can by no means be an encroachment
upon the autonomy of local governments.
WHEREFORE, premises considered, the petition is hereby DISMISSED.
SO ORDERED.

G.R. No. 195390

December 10, 2014

GOV. LUIS RAYMUND F. VILLAFUERTE, JR., and the PROVINCE OF

CAMARINES SUR, Petitioners,
vs.
HON. JESSE M. ROBREDO, in his capacity as Secretary of the
Department of the Interior and Local Government, Respondent.
DECISION
REYES, J.:
1

This is a petition for certiorari and prohibition under Rule 65 of the 1997
Revised Rules of Court filed by former Governor Luis Raymund F. Villafuerte,
Jr. (Villafuerte) and the Province of Camarines Sur (petitioners), seeking to
annul and set aside the following issuances of the late Honorable Jesse M.
Robredo (respondent), in his capacity as then Secretary of the Department of
the Interior and Local Government (DILG), to wit:
(a) Memorandum Circular (MC) No. 2010-83dated August 31, 2010,
pertaining to the full disclosure of local budget and finances, and bids and
2
public offerings;
(b) MC No. 2010-138 dated December 2, 2010, pertaining to the use of the
3
20% component of the annual internal revenue allotment shares; and
(c) MC No. 2011-08 dated January 13, 2011, pertaining to the strict
adherence to Section 90 of Republic Act (R.A.) No. 10147 or the General
4
Appropriations Act of 2011.
The petitioners seek the nullification of the foregoing issuances on the
ground of unconstitutionality and for having been issued with grave abuse of
discretion amounting to lack orexcess of jurisdiction.
The Facts
In 1995, the Commission on Audit (COA) conducted an examination and
audit on the manner the local government units (LGUs) utilized their Internal
Revenue Allotment (IRA) for the calendar years 1993-1994. The examination
yielded an official report,showing that a substantial portion of the 20%
development fund of some LGUs was not actually utilized for development
projects but was diverted to expenses properly chargeable against the
Maintenance and Other Operating Expenses (MOOE), in stark violation of
Section 287 of R.A. No. 7160, otherwise known as the Local Government
Code of 1991 (LGC). Thus, on December 14, 1995, the DILG issued MC No.
5
95-216, enumerating the policies and guidelines on the utilization of the

development fund component of the IRA. It likewise carried a reminder to

LGUs of the strict mandate to ensure that public funds, like the 20%
development fund, "shall bespent judiciously and only for the very purpose or
6
purposes for which such funds are intended."
On September 20, 2005, then DILG Secretary Angelo T. Reyes and
Department of Budget and Management Secretary Romulo L. Neri issued
7
Joint MC No. 1, series of 2005, pertaining to the guidelines on the
appropriation and utilization of the 20% of the IRA for development projects,
which aims to enhance accountability of the LGUs in undertaking
development projects. The said memorandum circular underscored that the
20% of the IRA intended for development projects should be utilized for
social
development,
economic
development
and
environmental
8
management.
On August 31, 2010, the respondent, in his capacity as DILG Secretary,
9
issued the assailed MC No. 2010-83, entitled "Full Disclosure of Local
Budget and Finances, and Bids and Public Offerings," which aims to promote
good governance through enhanced transparency and accountability of
LGUs. The pertinent portion of the issuance reads:
Legal and Administrative Authority
Section 352 of the Local Government Code of 1991 requires the posting
within 30 days from the end of eachfiscal year in at least three (3) publicly
accessible and conspicuous places in the local government unit a summary
of all revenues collected and funds received including the appropriations and
disbursements of such funds during the preceding fiscal year.
On the other hand, Republic Act No. 9184, known as the Government
Procurement Reform Act, calls for the posting of the Invitation to Bid, Notice
of Award, Notice to Proceed and Approved Contract in the procuring entitys
premises, in newspapers of general circulation, the Philippine Government
Electronic Procurement System (PhilGEPS) and the website of the procuring
entity. The declared policy of the State to promote good local governance
also calls for the posting of budgets, expenditures, contracts and loans, and
procurement plans of local government units in conspicuous places within
public buildings in the locality, inthe web, and in print media of community or
general circulation.
Furthermore, the President, in his first State of the Nation Address, directed
all government agencies and entities to bring to an end luxurious spending
and misappropriation ofpublic funds and to expunge mendacious and
erroneous projects, and adhere to the zero-based approach budgetary
principle.

Responsibility of the Local Chief Executive

All Provincial Governors, City Mayors and Municipal Mayors, are directed to
faithfully comply with the above cited [sic] provisions of laws, and existing
national policy, by posting in conspicuous places within public buildings in the
locality, or inprint media of community or general circulation, and in their
websites, the following:
1. CY 2010 Annual Budget, information detail to the level of particulars of
personal services, maintenance and other operating expenses and capital
outlay per individual offices (Source Document - Local Budget Preparation
Form No. 3, titled, Program Appropriation and Obligation by Object of
Expenditure, limited to PS, MOOE and CO. For sample form, please visit
www.naga.gov.ph);
2. Quarterly Statement of Cash Flows, information detail to the level of
particulars of cash flows from operating activities (e.g. cash inflows, total
cash inflows, total cash outflows), cash flows from investing activities (e.g.
cash outflows), net increase in cash and cash at the beginning of the period
(Source Document - Statement of Cash Flows Form);
3. CY 2009 Statement of Receipts and Expenditures, information detail to the
level of particulars of beginning cash balance, receipts or income on local
sources (e.g., tax revenue, non-tax revenue), external sources, and receipts
from loans and borrowings, surplus of prior years, expenditures on general
services, economic services, social services and debt services, and total
expenditures (Source Document - Local Budget Preparation Form No. 2,
titled, Statement of Receipts and Expenditures);
4. CY 2010 Trust Fund (PDAF) Utilization, information detail to the level of
particulars of object expenditures (Source Document - Local Budget
Preparation Form No. 3, titled, Program Appropriation and Obligation by
Object of Expenditure, limited to PDAF Utilization);
5. CY 2010 Special Education Fund Utilization, information detail to the level
of particulars of object expenditures (Source Document - Local Budget
Preparation Form No. 3, titled, Program Appropriation and Obligation by
Object of Expenditure, limited to Special Education Fund);
6. CY 2010 20% Component of the IRA Utilization, information detail to the
level of particulars of objects of expenditure on social development,
economic development and environmental management (Source Document Local Budget Preparation Form No. 3, titled, Program Appropriation and
Obligation by Object of Expenditure, limited to 20% Component of the
Internal Revenue Allotment);

7. CY 2010 Gender and Development Fund Utilization, information detail to

the level of particulars of object expenditures (Source Document - Local
Budget Preparation Form No. 3, titled, Program Appropriation and Obligation
by Object of Expenditure, limited to Gender and Development Fund);
8. CY 2010 Statement of Debt Service, information detail to the level of name
of creditor, purpose of loan, date contracted, term, principal amount, previous
payment made on the principal and interest, amount due for the budget year
and balance of the principal (Source Document - Local Budget Preparation
Form No. 6, titled, Statement of Debt Service);
9. CY 2010 Annual Procurement Plan or Procurement List, information detail
to the level ofname of project, individual item or article and specification or
description of goods and services, procurement method, procuring office or
fund source, unit price or estimated cost or approved budget for the contract
and procurement schedule (Source Document - LGU Form No. 02, Makati
City. For sample form, please visit www.makati.gov.ph.)[;]
10. Items to Bid, information detail to the level of individual Invitation to Bid,
containing information as prescribed in Section 21.1 of Republic Act No.
9184, or The Government Procurement Reform Act, to be updated quarterly
(Source Document - Invitation to Apply for Eligibility and to Bid, as prescribed
in Section 21.1 of R.A. No. 9184. For sample form, please visit
www.naga.gov.ph);
11. Bid Results on Civil Works, and Goods and Services, information detail to
the level of project reference number, name and location of project, name
(company and proprietor) and address of winning bidder, bid amount,
approved budget for the contract, bidding date, and contract duration, to be
updated quarterly (Source Document Infrastructure Projects/Goods and
Services Bid-Out (2010), Naga City. For sample form, please visit
www.naga.gov.ph); and
12. Abstract of Bids as Calculated, information detail to the level of project
name, location, implementing office, approved budget for the contract,
quantity and items subject for bidding, and bids of competing bidders, to be
updated quarterly (Source Document - Standard Form No. SF-GOOD-40,
Revised May 24, 2004, Naga City. For sample form, please visit
www.naga.gov.ph).
The foregoing circular also statesthat non-compliance will be meted
10
sanctions in accordance with pertinent laws, rules and regulations.
On December 2, 2010, the respondent issued MC No. 2010-138,11
reiterating that 20% component of the IRA shall be utilized for desirable
social, economic and environmental outcomes essential to the attainment of

the constitutional objective of a quality oflife for all. It also listed the following
enumeration of expenses for which the fund must not be utilized, viz:
1. Administrative expenses such ascash gifts, bonuses, food allowance,
medical assistance, uniforms, supplies, meetings, communication, water and
light, petroleum products, and the like; 2. Salaries, wages or overtime pay;
3. Travelling expenses, whether domestic or foreign;
4. Registration or participation feesin training, seminars, conferences or
conventions;
5. Construction, repairor refinishing of administrative offices;
6. Purchase of administrative office furniture, fixtures, equipment or
appliances; and
7. Purchase, maintenance or repair of motor vehicles or motorcycles, except
12
ambulances. On January 13, 2011, the respondent issued MC No. 201113
08, directing for the strict adherence toSection 90 of R.A. No. 10147 or the
General Appropriations Act of 2011. The pertinent portion of the issuance
reads as follows:

Non-compliance with the foregoing shall be dealt with in accordance with

pertinent laws, rules and regulations. In particular, attention is invited to the
provision of the Local Government Code of 1991, quoted as follows:
Section 60. Grounds for Disciplinary Actions - An elective local official may
be disciplined, suspended, or removed from office on: (c) Dishonesty,
oppression, misconduct in office, gross negligence, or dereliction of duty. x x
15
x (Emphasis and underscoring in the original)
On February 21, 2011, Villafuerte, then Governor of Camarines Sur, joined
by the Provincial Government of Camarines Sur, filed the instant petition for
certiorari, seeking to nullify the assailed issuances of the respondent for
being unconstitutional and having been issued with grave abuse of
discretion.
16

On June 2, 2011, the respondent filed his Comment on the petition. Then,
on June 22, 2011, the petitioners filed their Reply (With Urgent Prayer for the
Issuance of a Writ of Preliminary Injunction and/or Temporary Restraining
17
18
Order). In the Resolution dated October 11, 2011, the Court gave due
course to the petition and directed the parties to file their respective
memorandum. In compliance therewith, the respondent and the petitioners
19
20
filed their Memorandum on January 19, 2012 and on February 8, 2012
respectively.

Legal and Administrative Authority

The petitioners raised the following issues:
Section 90 of Republic Act No. 10147 (General Appropriations Act) FY
2011 re "Use and Disbursement of Internal Revenue Allotment of LGUs",
[sic] stipulates: The amount appropriated for the LGUs share in the Internal
Revenue Allotment shall be used in accordance with Sections 17 (g) and 287
of R.A. No 7160. The annual budgets of LGUs shall be prepared in
accordance with the forms, procedures, and schedules prescribed by the
Department of Budget and Management and those jointly issued with the
Commission on Audit. Strict compliance with Sections 288 and 354 of R.A.
No. 7160 and DILG Memorandum Circular No. 2010-83, entitled "Full
Disclosure of Local Budget and Finances, and Bids and Public offering" is
hereby mandated; PROVIDED, That in addition to the publication or posting
requirement under Section 352 of R.A. No. 7160 in three (3) publicly
accessible and conspicuous places in the local government unit, the LGUs
shall also post the detailed information on the use and disbursement, and
status of programs and projects in the LGUS websites. Failure to comply with
these requirements shall subject the responsible officials to disciplinary
14
actions in accordance with existing laws. x x x

Issues
I.

II.

THE HON. SECRETARY OF THE INTERIOR AND LOCAL

GOVERNMENT COMMITTED GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN
HEISSUED THE ASSAILED MEMORANDUM CIRCULARS IN
VIOLATION OF THE PRINCIPLES OF LOCAL AUTONOMY AND
FISCAL AUTONOMY ENSHRINED IN THE 1987 CONSTITUTION
AND THE LOCAL GOVERNMENT CODE OF 1991[.]
THE HON. SECRETARY OF THE INTERIOR AND LOCAL
GOVERNMENT COMMITTED GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN
HEINVALIDLY
ASSUMED
LEGISLATIVE
POWERS
IN
PROMULGATING THE ASSAILED MEMORANDUM CIRCULARS
WHICH WENT BEYOND THE CLEAR AND MANIFEST INTENT OF
THE 1987 CONSTITUTION AND THE LOCAL GOVERNMENT
21
CODE OF 1991[.]

xxxx
Ruling of the Court
Sanctions

27

The present petition revolves around the main issue: Whether or not the
assailed memorandum circulars violate the principles of local and fiscal
autonomy enshrined in the Constitution and the LGC.

No. 2011-009 dated May 10, 2011 from the Office of the Provincial Auditor
of Camarines Sur, requiring him to comment on the observation of the audit
team, which states:

The present petition is ripe for judicial review.

The Province failed to post the transactions and documents required under
Department of Interior and Local Government (DILG) Memorandum Circular
No. 2010-83, thereby violating the mandate of full disclosure of Local Budget
and Finances, and Bids and Public Offering.

At the outset, the respondent is questioning the propriety of the exercise of

the Courts power of judicial review over the instant case. He argues that the
petition is premature since there is yet any actual controversy that is ripe for
judicial determination. He points out the lack of allegation in the petition that
the assailed issuances had been fully implemented and that the petitioners
had already exhausted administrative remedies under Section 25 of the
22
Revised Administrative Code before filing the same in court.
It is well-settled that the Courts exercise of the power of judicial review
requires the concurrence of the following elements: (1) there must be an
actual case or controversy calling for the exercise of judicial power; (2) the
person challenging the act must have the standing to question the validity of
the subject act or issuance; otherwise stated, he must have a personal and
substantial interest in the case such that he has sustained, or will sustain,
direct injury as a result of its enforcement; (3) the question of constitutionality
must be raised at the earliest opportunity; and (4) the issue of
23
constitutionality must be the very lis motaof the case.
The respondent claims that there isyet any actual case or controversy that
calls for the exercise of judicial review. He contends that the mere
expectation of an administrative sanction does not give rise to a justiciable
controversy especially, in this case, that the petitioners have yet to exhaust
24
administrative remedies available.
The Court disagrees.
In La Bugal-Blaan Tribal Association, Inc. v. Ramos,
characterized an actual case or controversy, viz:

25

the Court

An actual case or controversy means an existing case or controversy that is

appropriate or ripe for determination, not conjectural or anticipatory, lest the
decision of the court would amount to an advisory opinion. The power does
not extend to hypothetical questions since any attempt at abstraction could
only lead to dialectics and barren legal questions and to sterile conclusions
26
unrelated to actualities. (Citations omitted)
The existence of an actual controversy in the instant case cannot be
overemphasized. At the time of filing of the instant petition, the respondent
had already implemented the assailed memorandum circulars. In fact, on
May 26, 2011, Villafuerte received Audit Observation Memorandum (AOM)

xxxx
The local officials concerned are reminded of the sanctions mentioned in the
circular which is quoted hereunder, thus:
"Non compliance with the foregoing shall be dealt with in accordance with
pertinent laws, rules and regulations. In particular, attention is invited to the
provision of Local Government Code of 1991, quoted as follows:
Section 60. Grounds for Disciplinary Actions An elective local official may
be disciplined, suspended or removed from office on: (c) Dishonesty,
28
oppression, misconduct in office, gross negligence or dereliction of duty."
The issuance of AOM No. 2011-009 to Villafuerte is a clear indication that the
assailed issuances of the respondent are already in the full course of
implementation. The audit memorandum specifically mentioned of
Villafuertes alleged non-compliance with MCNo. 2010-83 regarding the
posting requirements stated in the circular and reiterated the sanctions that
may be imposed for the omission. The fact that Villafuerte is being required
to comment on the contents of AOM No. 2011-009 signifies that the process
of investigation for his alleged violation has already begun. Ultimately, the
investigation is expected to end in a resolution on whether a violation has
indeed been committed, together with the appropriate sanctions that come
with it. Clearly, Villafuertes apprehension is real and well-founded as he
stands to be sanctioned for non-compliance with the issuances.
There is likewise no merit in the respondents claim that the petitioners
failure to exhaust administrative remedies warrants the dismissal of the
petition. It bears emphasizing that the assailed issuances were issued
pursuant to the rule-making or quasi-legislative power of the DILG. This
pertains to "the power to make rules and regulations which results in
29
delegated legislation that is within the confines of the granting statute." Not
to be confused with the quasi-legislative or rule-making power of an
administrative agency is its quasi-judicial or administrative adjudicatory
power. This is the power to hear and determine questions of fact to which the
legislative policy is to apply and to decide in accordance with the standards
30
laid down by the law itself in enforcing and administering the same law. In

challenging the validity of anadministrative issuance carried out pursuant to

the agencys rule-making power, the doctrine of exhaustion of administrative
remedies does not stand as a bar in promptly resorting to the filing of a case
in court. This was made clear by the Court in Smart Communications, Inc.
31
(SMART) v. National Telecommunications Commission (NTC), where it
was ruled, thus:

partners in the attainment ofnational goals. Toward this end, the State shall
provide for a more responsive and accountable local government structure
instituted through a system of decentralization whereby local government
units shall be given more powers, authority, responsibilities, and resources.
The process of decentralization shall proceed from the national government
to the local government units.

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 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 orquasi32
legislative power. x x x.

Verily, local autonomy means a more responsive and accountable local

36
government structure instituted through a system of decentralization. In
37
Limbona v. Mangelin,
the Court elaborated on the concept of
decentralization, thus:

Considering the foregoing clarification, there is thus no bar for the Court to
resolve the substantive issues raised in the petition.
The assailed memorandumcirculars do not transgress the localand fiscal
autonomy granted toLGUs.
The petitioners argue that the assailed issuances of the respondent interfere
with the local and fiscal autonomy of LGUs embodied in the Constitution and
the LGC. In particular, they claim that MC No. 2010-138 transgressed these
constitutionally-protected liberties when it restricted the meaning of
"development" and enumerated activities which the local government must
finance from the 20% development fund component of the IRA and provided
sanctions for local authorities who shall use the said component of the fund
33
for the excluded purposes stated therein. They argue that the respondent
cannot substitute his own discretion with that of the local legislative council in
enacting its annual budget and specifying the development projects that the
34
20% component of its IRA should fund.
The argument fails to persuade.
The Constitution has expressly adopted the policy of ensuring the autonomy
35
of LGUs. To highlight its significance, the entire Article X of the Constitution
was devoted to laying down the bedrock upon which this policy is anchored.
It is also pursuant to the mandate of the Constitution of enhancing local
autonomy that the LGC was enacted. Section 2 thereof was a reiteration of
the state policy. It reads, thus:
Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the
State that the territorial and political subdivisions of the State shall enjoy
genuine and meaningful local autonomy to enable them to attain their fullest
development as self-reliant communities and make them more effective

[A]utonomy is either decentralization of administration ordecentralization of

power. There is decentralization of administration when the central
government delegates administrative powers to political subdivisions in order
to broaden the base of government power and in the process to make local
governments "more responsive and accountable," and "ensure their fullest
development as self-reliant communities and make them more effective
partners in the pursuit of national development and social progress." At the
same time, it relieves the central government of the burden of managing local
affairs and enables it to concentrate on national concerns. x x x.
Decentralization of power, on the other hand, involves an abdication of
political power in the favor of local governments [sic] units declared to be
autonomous. In thatcase, the autonomous government is free to chart its
own destiny and shape its future with minimum intervention from central
38
authorities. x x x. (Citations omitted)
To safeguard the state policy on local autonomy, the Constitution confines
39
the power of the President over LGUs to mere supervision. "The President
exercises general supervision over them, but only to ensure that local
affairs are administered according to law. He has no control over their acts in
40
the sense that he can substitute their judgments with his own." Thus,
Section 4, Article X of the Constitution, states:
Section 4. The President of the Philippines shall exercise general supervision
over local governments. Provinces with respect to component cities and
municipalities, and cities and municipalities with respect to component
barangays, shall ensure that the acts of their component units are within the
scope of their prescribed powers and functions.
41

In Province of Negros Occidental v. Commissioners, Commission on Audit,

the Court distinguished general supervision from executive control in the
following manner:

The Presidents power of general supervision means the power of a superior

officer to see to it that subordinates perform their functions according to law.

This is distinguished from the Presidents power of control which is the power
to alter or modify or set aside what a subordinate officer had done in the
performance of his duties and to substitute the judgment of the President
over that of the subordinate officer. The power of control gives the President
the power to revise or reverse the acts or decisions of a subordinate officer
42
involving the exercise of discretion. (Citations omitted)
It is the petitioners contention that the respondent went beyond the confines
of his supervisory powers, asalter ego of the President, when he issued MC
No. 2010-138. They arguethat the mandatory nature of the circular, with the
threat of imposition of sanctions for non-compliance, evinces a clear desire to
43
exercise control over LGUs.
The Court, however, perceives otherwise.
A reading of MC No. 2010-138 shows that it is a mere reiteration of an
existing provision in the LGC. It was plainly intended to remind LGUs to
faithfully observe the directive stated in Section 287 of the LGC to utilize the
20% portion of the IRA for development projects. It was, at best, an advisory
to LGUs to examine themselves if they have been complying with the law. It
must be recalled that the assailed circular was issued in response to the
report of the COA that a substantial portion of the 20% development fund of
some LGUs was not actually utilized for development projects but was
diverted to expenses more properly categorized as MOOE, in violation of
Section 287 of the LGC. This intention was highlighted in the very first
paragraph of MC No. 2010-138, which reads:
Section 287 of the Local Government Code mandates every local
government to appropriate in its annual budget no less than 20% of its
annual revenue allotment for development projects. In common
understanding, development means the realization of desirable social,
economic and environmental outcomes essential in the attainment of the
44
constitutional objective of a desired quality of life for all. (Underscoring in
the original)
That the term developmentwas characterized asthe "realization of desirable
social, economic and environmental outcome" does not operate as a
restriction of the term so as to exclude some other activities that may bring
about the same result. The definition was a plain characterization of the
concept of development as it is commonly understood. The statement of a
general definition was only necessary to illustrate among LGUs the nature of
expenses that are properly chargeable against the development fund
component of the IRA. It is expected to guide them and aid them in rethinking
their ways so that they may be able to rectify lapses in judgment, should
there be any, or it may simply stand as a reaffirmation of an already proper
administration of expenses.

The same clarification may be said of the enumeration of expenses in MC

No. 2010-138. To begin with, it is erroneous to call them exclusions because
such a term signifies compulsory disallowance of a particular item or activity.
This is not the contemplation of the enumeration. Again, it is helpful to
retrace the very reason for the issuance of the assailed circular for a better
understanding. The petitioners should be reminded that the issuance of MC
No. 2010-138 was brought about by the report of the COA that the
development fund was not being utilized accordingly. To curb the alleged
misuse of the development fund, the respondent deemed it proper to remind
LGUs of the nature and purpose of the provision for the IRA through MC No.
2010-138. To illustrate his point, heincluded the contested enumeration of
the items for which the development fund must generallynot be used. The
enumerated items comprised the expenses which the COA perceived to
have been improperly earmarked or charged against the development fund
based on the audit it conducted.
Contrary to the petitioners posturing, however, the enumeration was not
meant to restrict the discretion of the LGUs in the utilization of their funds. It
was meant to enlighten LGUs as to the nature of the development fund by
delineating it from other types of expenses. It was incorporated in the
assailed circular in order to guide them in the proper disposition of the IRA
and avert further misuse of the fund by citing current practices which seemed
to be incompatible with the purpose of the fund. Even then, LGUs remain at
liberty to map out their respective development plans solely on the basis of
their own judgment and utilize their IRAs accordingly, with the only restriction
that 20% thereof be expended for development projects. They may even
spend their IRAs for some of the enumerated items should they partake of
indirect costs of undertaking development projects. In such case, however,
the concerned LGU must ascertain that applicable rules and regulations on
budgetary allocation have been observed lest it be inviting an administrative
probe.
The petitioners likewise misread the issuance by claiming that the provision
of sanctions therein is a clear indication of the Presidents interference in the
fiscalautonomy of LGUs. The relevant portion of the assailed issuance reads,
thus:
All local authorities are further reminded that utilizing the 20% component of
the Internal Revenue Allotment, whether willfully or through negligence, for
any purpose beyond those expressly prescribed by law or public policy shall
be subject to the sanctions provided under the Local Government Code and
45
under such other applicable laws.
Significantly, the issuance itself did not provide for sanctions. It did not
particularly establish a new set ofacts or omissions which are deemed
violations and provide the corresponding penalties therefor. It simply stated a

reminder to LGUs that there are existing rules to consider in the

disbursement of the 20% development fund and that non-compliance
therewith may render them liable to sanctions which are provided in the LGC
and other applicable laws. Nonetheless, this warning for possible imposition
of sanctions did not alter the advisory nature of the issuance. At any rate,
LGUs must be reminded that the local autonomy granted to them does not
completely severe them from the national government or turn them into
impenetrable states. Autonomy does not make local governments sovereign
46
47
within the state. InGanzon v. Court of Appeals, the Court reiterated:
Autonomy, however, is not meant to end the relation of partnership and
interdependence between the central administration and local government
units, or otherwise, to usher in a regime of federalism. The Charter has not
taken such a radical step.1avvphi1 Local governments, under the
Constitution, are subject to regulation, however limited, and for no other
48
purpose than precisely, albeit paradoxically, to enhance self-government.

plans of LGUs be publicly posted as well.

52

Pertinently, Section 352 of the LGC reads:

Section 352. Posting of the Summary of Income and Expenditures. Local
treasurers, accountants, budget officers, and other accountable officers shall,
within thirty (30) days from the end of the fiscal year, post in at least three (3)
publicly accessible and conspicuous places in the local government unit a
summary of all revenues collected and funds received including the
appropriations and disbursements of such funds during the preceding fiscal
year.
R.A. No. 9184, on the other hand, requires the posting of the invitation to bid,
notice of award, notice to proceed, and approved contract in the procuring
entitys premises, in newspapers of general circulation, and the website of
53
the procuring entity.

Thus, notwithstanding the local fiscal autonomy being enjoyed by LGUs, they
are still under the supervision of the President and maybe held accountable
for malfeasance or violations of existing laws. "Supervision is not
incompatible with discipline. And the power to discipline and ensure that the
laws be faithfully executed must be construed to authorize the President to
order an investigation of the act or conduct of local officials when in his
49
opinion the good of the public service so requires."

It is well to remember that fiscal autonomy does not leave LGUs with
unbridled discretion in the disbursement of public funds. They remain
accountable to their constituency. For, public office was created for the
benefit of the people and not the person who holds office.

Clearly then, the Presidents power of supervision is not antithetical to

investigation and imposition of sanctions. In Hon. Joson v. Exec. Sec.
50
Torres, the Court pointed out, thus: "Independently of any statutory
provision authorizing the President to conduct an investigation of the nature
involved in this proceeding, and in view of the nature and character of the
executive authority with which the President of the Philippines is invested,
the constitutional grant to him of power to exercise general supervision over
all local governments and to take care that the laws be faithfully executed
must be construed to authorize him to order an investigation of the act or
conduct of the petitioner herein. Supervision is not a meaningless thing. It is
an active power. It is certainly not without limitation, but it at least implies
authority to inquire into facts and conditions in order to render the power real
51
and effective. x x x." (Emphasis ours and italics in the original)

Public office is a public trust. It must be discharged by its holder not for his
own personal gain but for the benefit of the public for whom he holds it in
trust. By demanding accountability and service with responsibility, integrity,
loyalty, efficiency, patriotism and justice, all government officials and
employees havethe duty to be responsive to the needs of the people they are
55
called upon to serve.

As in MC No. 2010-138, the Court finds nothing in two other questioned

issuances of the respondent, i.e., MC Nos. 2010-83 and 2011-08, that can be
construed as infringing onthe fiscal autonomy of LGUs. The petitioners claim
that the requirement to post other documents in the mentioned issuances
went beyond the letter and spirit of Section 352 of the LGC and R.A. No.
9184, otherwise known as the Government Procurement Reform Act, by
requiring that budgets, expenditures, contracts and loans, and procurement

The Court strongly enunciated in ABAKADA GURO Party List (formerly

54
AASJS), et al. v.Hon. Purisima, et al., thus:

Thus, the Constitution strongly summoned the State to adopt and implement
a policy of full disclosure of all transactions involving public interest and
56
provide the people with the right to access public information. Section 352
of the LGC is a response to this call for transparency. It is a mechanism of
transparency and accountability of local government officials and is in fact
incorporated under Chapter IV of the LGC which deals with "Expenditures,
Disbursements, Accounting and Accountability."
In the same manner, R.A. No. 9184 established a system of transparency in
the procurement process and in the implementation of procurement contracts
57
in government agencies. It is the public monitoring of the procurement
process and the implementation of awarded contracts with the end in view of
guaranteeing that these contracts are awarded pursuant to the provisions of
the law and its implementing rules and regulations, and that all these

contracts are performed strictly according to specifications.

58

The assailed issuances of the respondent, MC Nos. 2010-83 and 2011-08,

are but implementation of this avowed policy of the State to make public
officials accountable to the people. They are amalgamations of existing laws,
rules and regulation designed to give teeth to the constitutional mandate of
transparency and accountability.
A scrutiny of the contents of the mentioned issuances shows that they do
not, in any manner, violate the fiscal autonomy of LGUs. To be clear, "[f]iscal
autonomy means that local governments have the power to create their own
sources of revenue in addition to their equitable share in the national taxes
released by the national government, as well as the power to allocate their
resources in accordance withtheir own priorities.It extends to the preparation
of their budgets, and local officials in turn have to work within the constraints
59
thereof."

61

policies, plans and programs for the entire country.

Moreover, the
Constitution, which was drafted after long years of dictatorship and abuse of
power, is now replete with numerous provisions directing the adoption of
measures to uphold transparency and accountability in government, with a
view of protecting the nation from repeating its atrocious past. In particular,
the Constitution commands the strict adherence to full disclosure of
information onall matters relating to official transactions and those involving
public interest. Pertinently, Section 28, Article II and Section 7, Article III of
the Constitution, provide: Article II
Declaration of Principles and State Policies Principles
Section 28. Subject to reasonable conditions prescribed by law, the State
adopts and implements a policy of full public disclosure of all its transactions
involving public interest.
Article III

It is inconceivable, however, how the publication of budgets, expenditures,

contracts and loans and procurement plans of LGUs required in the assailed
issuances could have infringed on the local fiscal autonomy of LGUs. Firstly,
the issuances do not interfere with the discretion of the LGUs in the
specification of their priority projects and the allocation of their budgets. The
posting requirements are mere transparency measures which do not at all
hurt the manner by which LGUs decide the utilization and allocation of their
funds.
Secondly, it appears that even Section 352 of the LGC that is being invoked
by the petitioners does not exclude the requirement for the posting of the
additional documents stated in MC Nos. 2010-83 and 2011-08. Apparently,
the mentioned provision requires the publication of "a summary of revenues
collected and funds received, including the appropriations and disbursements
of such funds." The additional requirement for the posting of budgets,
expenditures, contracts and loans, and procurement plans are well-within the
contemplation of Section 352 of the LGC considering they are documents
necessary for an accurate presentation of a summary of appropriations and
disbursements that an LGU is required to publish.
Finally, the Court believes that the supervisory powers of the President are
broad enough to embrace the power to require the publication of certain
documents as a mechanism of transparency. In Pimentel,Jr. v. Hon.
60
Aguirre, the Court reminded that localfiscal autonomy does not rule out any
manner of national government intervention by way of supervision, in order to
ensure that local programs, fiscal and otherwise, are consistent with national
goals. The President, by constitutional fiat, is the head of the economic and
planning agency of the government, primarily responsible for formulating and
implementing continuing, coordinated and integrated social and economic

Bill of Rights
Section 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, transactions, or decisions, as well as to government
research data used as basis for policy development, shall be afforded the
citizen, subject to such limitations as may be provided by law.
In the instant case, the assailed issuances were issued pursuant to the policy
of promoting good governance through transparency, accountability and
participation. The action of the respondent is certainly within the
constitutional bounds of his power as alter ego of the President.
It is needless to say that the power to govern is a delegated authority from
the people who hailed the public official to office through the democratic
process of election. His stay in office remains a privilege which may be
withdrawn by the people should he betray his oath of office. Thus, he must
not frown upon accountability checks which aim to show how well he is
performing his delegated power. For, it is through these mechanisms of
transparency and accountability that he is able to prove to his constituency
that he is worthy of the continued privilege.
WHEREFORE, in view of the foregoing considerations, the petition is
DISMISSED for lack of merit.
SO ORDERED.

G. R. No. 155027

February 28, 2006

THE VETERANS FEDERATION OF THE PHILIPPINES represented by

Esmeraldo R. Acorda, Petitioner,
vs.
Hon. ANGELO T. REYES in his capacity as Secretary of National
Defense; and Hon. EDGARDO E. BATENGA in his capacity as
Undersecretary for Civil Relations and Administration of the
Department of National Defense, Respondents.
DECISION

Please be informed that during the preparation of my briefing before the

Cabinet and the President last March 9, 2002, we came across some legal
bases which tended to show that there is an organizational and management
relationship between Veterans Federation of the Philippines and the
Philippine Veterans Bank which for many years have been inadvertently
overlooked.
I refer to Republic Act 2640 creating the body corporate known as the VFP
and Republic Act 3518 creating the Phil. Vets [sic] Bank.
1. RA 2640 dated 18 June 60 Section 1 ... "hereby created a body corporate,
under the control and supervision of the Secretary of National Defense."

CHICO-NAZARIO, J.:
This is a Petition for Certiorari with Prohibition under Rule 65 of the 1997
Rules of Civil Procedure, with a prayer to declare as void Department
Circular No. 04 of the Department of National Defense (DND), dated 10 June
2002.
Petitioner in this case is the Veterans Federation of the Philippines (VFP), a
corporate body organized under Republic Act No. 2640, dated 18 June 1960,
as amended, and duly registered with the Securities and Exchange
Commission. Respondent Angelo T. Reyes was the Secretary of National
Defense (DND Secretary) who issued the assailed Department Circular No.
04, dated 10 June 2002. Respondent Edgardo E. Batenga was the DND
Undersecretary for Civil Relations and Administration who was tasked by the
respondent DND Secretary to conduct an extensive management audit of the
records of petitioner.
The factual and procedural antecedents of this case are as follows:
1

Petitioner VFP was created under Rep. Act No. 2640, a statute approved on
18 June 1960.
On 15 April 2002, petitioners incumbent president received a letter dated 13
April 2002 which reads:

2. RA 2640 Section 12 ... "On or before the last day of the month following
the end of each fiscal year, the Federation shall make and transmit to the
President of the Philippines or to the Secretary of National Defense, a report
of its proceedings for the past year, including a full, complete and itemized
report of receipts and expenditures of whatever kind."
3. Republic Act 3518 dated 18 June 1963 (An Act Creating the Philippine
Veterans Bank, and for Other Purposes) provides in Section 6 that ... "the
affairs and business of the Philippine Veterans Bank shall be directed and its
property managed, controlled and preserved, unless otherwise provided in
this Act, by a Board of Directors consisting of eleven (11) members to be
composed of three ex officio members to wit: the Philippine Veterans
Administrator, the President of the Veterans Federation of the Philippines
and the Secretary of National Defense x x x.
It is therefore in the context of clarification and rectification of what should
have been done by the DND (Department of National Defense) for and about
the VFP and PVB that I am requesting appropriate information and report
about these two corporate bodies.
Therefore it may become necessary that a conference with your staffs in
these two bodies be set.
Thank you and anticipating your action on this request.

Col. Emmanuel V. De Ocampo (Ret.)

Very truly yours,
President
(SGD) ANGELO T. REYES
Veterans Federation of the Philippines
[DND] Secretary
Makati, Metro Manila
Dear Col. De Ocampo:

On 10 June 2002, respondent DND Secretary issued the assailed DND

Department Circular No. 04 entitled, "Further Implementing the Provisions of

Sections 1 and 2 of Republic Act No. 2640," the full text of which appears
as follows:
Department of National Defense
Department Circular No. 04
Subject: Further Implementing the Provisions of Sections 1 & 2 of
Republic Act No. 2640
Authority: Republic Act No. 2640
Executive Order No. 292 dated July 25, 1987
Section 1
These rules shall govern and apply to the management and operations of the
Veterans Federation of the Philippines (VFP) within the context provided by
EO 292 s-1987.
Section 2 DEFINITION OF TERMS for the purpose of these rules, the
terms, phrases or words used herein shall, unless the context indicates
otherwise, mean or be understood as follows:
Supervision and Control it shall include authority to act directly whenever a
specific function is entrusted by law or regulation to a subordinate; direct the
performance of a duty; restrain the commission of acts; approve, reverse or
modify acts and decisions of subordinate officials or units; determine
priorities in the execution of plans and programs; and prescribe standards,
guidelines, plans and programs.
Power of Control power to alter, modify, nullify or set aside what a
subordinate officer had done in the performance of his duties and to
substitute the judgment of the former to that of the latter.
Supervision means overseeing or the power of an officer to see to it that
their subordinate officers perform their duties; it does not allow the superior
to annul the acts of the subordinate.
Administrative Process embraces matter concerning the procedure in the
disposition of both routine and contested matters, and the matter in which
determinations are made, enforced or reviewed.
Government Agency as defined under PD 1445, a government agency or
agency of government or "agency" refers to any department, bureau or office

of the national government, or any of its branches or instrumentalities, of any

political subdivision, as well as any government owned or controlled
corporation, including its subsidiaries, or other self-governing board or
commission of the government.
Government Owned and Controlled Corporation (GOCC) refer to any
agency organized as a stock or non-stock corporation, vested with functions
relating to public needs whether governmental or proprietary in nature, and
owned by the government directly or through its instrumentalities wholly or,
where applicable as in the case of stock corporations, to the extent of at least
50% of its capital stock.
Fund sum of money or other resources set aside for the purpose of
carrying out specific activities or attaining certain objectives in accordance
with special regulations, restrictions or limitations and constitutes an
independent, fiscal and accounting entity.
Government Fund includes public monies of every sort and other resources
pertaining to any agency of the government.
Veteran any person who rendered military service in the land, sea or air
forces of the Philippines during the revolution against Spain, the Philippine
American War, World War II, including Filipino citizens who served in Allied
Forces in the Philippine territory and foreign nationals who served in
Philippine forces; the Korean campaign, the Vietnam campaign, the Antidissidence campaign, or other wars or military campaigns; or who rendered
military service in the Armed Forces of the Philippines and has been
honorably discharged or separated after at least six (6) years total cumulative
active service or sooner separated due to the death or disability arising from
a wound or injury received or sickness or disease incurred in line of duty
while in the active service.
Section 3 Relationship Between the DND and the VFP
3.1 Sec 1 of RA 3140 provides "... the following persons (heads of various
veterans associations and organizations in the Philippines) and their
associates and successors are hereby created a body corporate, under the
control and supervision of the Secretary of National Defense, under the
name, style and title of "Veterans Federation of the Philippines ..."
The Secretary of National Defense shall be charged with the duty of
supervising the veterans and allied program under the jurisdiction of the
Department. It shall also have the responsibility of overseeing and ensuring
the judicious and effective implementation of veterans assistance, benefits,
and utilization of VFP assets.

3.2 To effectively supervise and control the corporate affairs of the

Federation and to safeguard the interests and welfare of the veterans who
are also wards of the State entrusted under the protection of the DND, the
Secretary may personally or through a designated representative, require the
submission of reports, documents and other papers regarding any or all of
the Federations business transactions particularly those relating to the VFP
functions under Section 2 of RA 2640.
The Secretary or his representative may attend conferences of the supreme
council of the VFP and such other activities he may deem relevant.

As mandated under appropriate laws, the following reports shall be submitted

to the SND, to wit:
a. Annual Report to be submitted not later than every January 31 of the
following year. Said report shall consist of the following:
1. Financial Report of the Federation, signed by the Treasurer General and
Auditor General;
2. Roster of Members of the Supreme Council;

3.3 The Secretary shall from time to time issue guidelines, directives and
other orders governing vital government activities including, but not limited to,
the conduct of elections; the acquisition, management and dispositions of
properties, the accounting of funds, financial interests, stocks and bonds,
corporate investments, etc. and such other transactions which may affect the
interests of the veterans.

3. Roster of Members of the Executive Board and National Officers; and

3.4 Financial transactions of the Federation shall follow the provisions of the
government auditing code (PD 1445) i.e. government funds shall be spent or
used for public purposes; trust funds shall be available and may be spent
only for the specific purpose for which the trust was created or the funds
received; fiscal responsibility shall, to the greatest extent, be shared by all
those exercising authority over the financial affairs, transactions, and
operations of the federation; disbursements or dispositions of government
funds or property shall invariably bear the approval of the proper officials.

c. Report of the VFP President as may be required by SND or as may be

found necessary by the President of the Federation;

Section 4 Records of the FEDERATION

As a corporate body and in accordance with appropriate laws, it shall keep
and carefully preserve records of all business transactions, minutes of
meetings of stockholders/members of the board of directors reflecting all
details about such activity.
All such records and minutes shall be open to directors, trustees,
stockholders, and other members for inspection and copies of which may be
requested.
As a body corporate, it shall submit the following: annual report; proceedings
of council meetings; report of operations together with financial statement of
its assets and liabilities and fund balance per year; statement of revenues
and expenses per year; statement of cash flows per year as certified by the
accountant; and other documents/reports as may be necessary or required
by the SND.
Section 5 Submission of Annual and Periodic Report

4. Current listing of officers and management of VFP.

b. Report on the proceedings of each Supreme Council Meeting to be
submitted not later than one month after the meeting;

d. Resolutions passed by the Executive Board and the Supreme Council for
confirmation to be submitted not later than one month after the approval of
the resolution;
e. After Operation/Activity Reports to be submitted not later than one month
after such operation or activity;
Section 6 Penal Sanctions
As an attached agency to a regular department of the government, the VFP
and all its instrumentalities, officials and personnel shall be subject to the
penal provisions of such laws, rules and regulations applicable to the
attached agencies of the government.
In a letter dated 6 August 2002 addressed to the President of petitioner,
respondent DND Secretary reiterated his instructions in his earlier letter of 13
April 2002.
Thereafter, petitioners President received a letter dated 23 August 2002
from respondent Undersecretary, informing him that Department Order No.
129 dated 23 August 2002 directed "the conduct of a Management Audit of
4
the Veterans Federation of the Philippines." The letter went on to state that
respondent DND Secretary "believes that the mandate given by said law can
be meaningfully exercised if this department can better appreciate the
functions, responsibilities and situation on the ground and this can be done

by undertaking a thorough study of the organization."

Respondent Undersecretary also requested both for a briefing and for

documents on personnel, ongoing projects and petitioners financial
condition. The letter ended by stating that, after the briefing, the support staff
of the Audit Committee would begin their work to meet the one-month target
within which to submit a report.
A letter dated 28 August 2003 informed petitioners President that the
Management Audit Group headed by the Undersecretary would be paying
petitioner a visit on 30 August 2002 for an update on VFPs different affiliates
and the financial statement of the Federation.
Subsequently, the Secretary General of the VFP sent an undated letter to
respondent DND Secretary, with notice to respondent Undersecretary for
Civil Relations and Administration, complaining about the alleged broadness
of the scope of the management audit and requesting the suspension thereof
until such time that specific areas of the audit shall have been agreed upon.
The request was, however, denied by the Undersecretary in a letter dated 4
September 2002 on the ground that a specific timeframe had been set for the
activity.
Petitioner thus filed this Petition for Certiorari with Prohibition under Rule 65
of the 1997 Rules of Civil Procedure, praying for the following reliefs:
1. For this Court to issue a temporary restraining order and a writ of
preliminary prohibitory and mandatory injunction to enjoin respondent
Secretary and all those acting under his discretion and authority from: (a)
implementing DND Department Circular No. 04; and (b) continuing with the
ongoing management audit of petitioners books of account;
2. After hearing the issues on notice
a. Declare DND Department Circular No. 04 as null and void for being ultra
vires;
b. Convert the writ of prohibition, preliminary prohibitory and mandatory
6
injunction into a permanent one.
GIVING DUE COURSE TO THE PETITION
Petitioner asserts that, although cases which question the constitutionality or
validity of administrative issuances are ordinarily filed with the lower courts,
the urgency and substantive importance of the question on hand and the
public interest attendant to the subject matter of the petition justify its being

filed with this Court directly as an original action.

It is settled that the Regional Trial Court and the Court of Appeals also
exercise original jurisdiction over petitions for certiorari and prohibition. As we
have held in numerous occasions, however, such concurrence of original
jurisdiction does not mean that the party seeking extraordinary writs has the
8
absolute freedom to file his petition in the court of his choice. Thus, in
9
Commissioner of Internal Revenue v. Leal, we held that:
Such concurrence of original jurisdiction among the Regional Trial Court, the
Court of Appeals and this Court, however, does not mean that the party
seeking any of the extraordinary writs has the absolute freedom to file his
petition in the court of his choice. The hierarchy of courts in our judicial
system determines the appropriate forum for these petitions. Thus, petitions
for the issuance of the said writs against the first level (inferior) courts must
be filed with the Regional Trial Court and those against the latter, with the
Court of Appeals. A direct invocation of this Courts original jurisdiction to
issue these writs should be allowed only where there are special and
important reasons therefor, specifically and sufficiently set forth in the
petition. This is the established policy to prevent inordinate demands upon
the Courts time and attention, which are better devoted to matters within its
exclusive jurisdiction, and to prevent further over-crowding of the Courts
docket. Thus, it was proper for petitioner to institute the special civil action for
certiorari with the Court of Appeals assailing the RTC order denying his
motion to dismiss based on lack of jurisdiction.
The petition itself, in this case, does not specifically and sufficiently set forth
the special and important reasons why the Court should give due course to
this petition in the first instance, hereby failing to fulfill the conditions set forth
10
in Commissioner of Internal Revenue v. Leal. While we reiterate the
policies set forth in Leal and allied cases and continue to abhor the
propensity of a number of litigants to disregard the principle of hierarchy of
courts in our judicial system, we, however, resolve to take judicial notice of
the fact that the persons who stand to lose in a possible protracted litigation
in this case are war veterans, many of whom have precious little time left to
enjoy the benefits that can be conferred by petitioner corporation. This
bickering for the power over petitioner corporation, an entity created to
represent and defend the interests of Filipino veterans, should be resolved as
soon as possible in order for it to once and for all direct its resources to its
rightful beneficiaries all over the country. All these said, we hereby resolve to
give due course to this petition.
ISSUES
Petitioner mainly alleges that the rules and guidelines laid down in the
assailed Department Circular No. 04 expanded the scope of "control and

11

The following provision of the 1935 Constitution, the organic act controlling at
the time of the creation of the VFP in 1960, is relevant:

1. Was the challenged department circular passed in the valid exercise of the
respondent Secretarys "control and supervision"?

Section 7. The Congress shall not, except by general law, provide for the
formation, organization, or regulation of private corporations, unless such
corporations are owned and controlled by the Government or any subdivision
15
or instrumentality thereof.

supervision" beyond what has been laid down in Rep. Act No. 2640.
Petitioner further submits the following issues to this Court:

2. Could the challenged department circular validly lay standards classifying

the VFP, an essentially civilian organization, within the ambit of statutes only
applying to government entities?
3. Does the department circular, which grants respondent direct
management control on the VFP, unduly encroach on the prerogatives of
VFPs governing body?
At the heart of all these issues and all of petitioners prayers and assertions
in this case is petitioners claim that it is a private non-government
corporation.
CENTRAL ISSUE:
IS THE VFP A PRIVATE CORPORATION?
Petitioner claims that it is not a public nor a governmental entity but a private
organization, and advances this claim to prove that the issuance of DND
Department Circular No. 04 is an invalid exercise of respondent Secretarys
12
control and supervision.
This Court has defined the power of control as "the power of an officer to
alter or modify or nullify or set aside what a subordinate has done in the
performance of his duties and to substitute the judgment of the former to that
13
of the latter." The power of supervision, on the other hand, means
"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
14
perform their duties." These definitions are synonymous with the definitions
in the assailed Department Circular No. 04, while the other provisions of the
assailed department circular are mere consequences of control and
supervision as defined.
Thus, in order for petitioners premise to be able to support its conclusion,
petitioners should be deemed to imply either of the following: (1) that it is
unconstitutional/impermissible for the law (Rep. Act No. 2640) to grant
control and/or supervision to the Secretary of National Defense over a private
organization, or (2) that the control and/or supervision that can be granted to
the Secretary of National Defense over a private organization is limited, and
is not as strong as they are defined above.

On the other hand, its counterparts in the 1973 and 1987 constitutions are
the following:
Section 4. The National Assembly shall not, except by general law, provide
for the formation, organization, or regulation of private corporations, unless
such corporations are owned or controlled by the government or any
16
subdivision or instrumentality thereof.
Sec. 16. The Congress shall not, except by general law, provide for the
formation, organization, or regulation of private corporations. Governmentowned and controlled corporations may be created or established by special
charters in the interest of the common good and subject to the test of
17
economic viability.
From the foregoing, it is crystal clear that our constitutions explicitly prohibit
the regulation by special laws of private corporations, with the exception of
government-owned or controlled corporations (GOCCs). Hence, it would be
impermissible for the law to grant control of the VFP to a public official if it
were neither a public corporation, an unincorporated governmental entity, nor
18
a GOCC. Said constitutional provisions can even be read to prohibit the
creation itself of the VFP if it were neither of the three mentioned above, but
we cannot go into that in this case since there is no challenge to the creation
of the VFP in the petition as to permit this Court from considering its nullity.
Petitioner vigorously argues that the VFP is a private non-government
organization, pressing on the following contentions:
1. The VFP does not possess the elements which would qualify it as a public
office, particularly the possession/delegation of a portion of sovereign power
of government to be exercised for the benefit of the public;
2. VFP funds are not public funds because
a) No budgetary appropriations or government funds have been released to
the VFP directly or indirectly from the Department of Budget and
Management (DBM);
b) VFP funds come from membership dues;

c) The lease rentals raised from the use of government lands reserved for
the VFP are private in character and do not belong to the government. Said
rentals are fruits of VFPs labor and efforts in managing and administering
the lands for VFP purposes and objectives. A close analogy would be any
Filipino citizen settling on government land and who tills the land for his
livelihood and sustenance. The fruits of his labor belong to him and not to the
owner of the land. Such fruits are not public funds.

expenditures of whatever kind, to the President of the Philippines or to the

20
Secretary of National Defense.
(4) Under Executive Order No. 37 dated 2 December 1992, the VFP was
listed as among the government-owned and controlled corporations that will
not be privatized.
21

3. Although the juridical personality of the VFP emanates from a statutory

charter, the VFP retains its essential character as a private, civilian
federation of veterans voluntarily formed by the veterans themselves to attain
a unity of effort, purpose and objectives, e.g.
a. The members of the VFP are individual members and retirees from the
public and military service;
b. Membership in the VFP is voluntary, not compulsory;
c. The VFP is governed, not by the Civil Service Law, the Articles of War nor
the GSIS Law, but by the Labor Code and the SSS Law;

(5) In Ang Bagong Bayani OFW Labor Party v. COMELEC, this Court
held in a minute resolution that the "VFP [Veterans Federation Party] is an
adjunct of the government, as it is merely an incarnation of the Veterans
Federation of the Philippines.
And now to answer petitioners reasons for insisting that it is a private
corporation:
1. Petitioner claims that the VFP does not possess the elements which would
qualify it as a public office, particularly the possession/delegation of a portion
of sovereign power of government to be exercised for the benefit of the
public;
22

d. The VFP has its own Constitution and By-Laws and is governed by a
Supreme Council who are elected from and by the members themselves;
4. The Administrative Code of 1987 does not provide that the VFP is an
attached agency, nor does it provide that it is an entity under the control and
supervision of the DND in the context of the provisions of said code.

In Laurel v. Desierto, we adopted the definition of Mechem of a public

office, that it is "the right, authority and duty, created and conferred by law,
by which, for a given period, either fixed by law or enduring at the pleasure of
the creating power, an individual is invested with some portion of the
sovereign functions of the government, to be exercised by him for the benefit
of the public."

(2) Any action or decision of the Federation or of the Supreme Council shall
19
be subject to the approval of the Secretary of Defense.

In the same case, we went on to adopt Mechems view that the delegation to
the individual of some of the sovereign functions of government is "[t]he most
important characteristic" in determining whether a position is a public office
23
or not. Such portion of the sovereignty of the country, either legislative,
executive or judicial, must attach to the office for the time being, to be
exercised for the public benefit. Unless the powers conferred are of this
nature, the individual is not a public officer. The most important characteristic
which distinguishes an office from an employment or contract is that the
creation and conferring of an office involves a delegation to the individual of
some of the sovereign functions of government, to be exercised by him for
the benefit of the public; that some portion of the sovereignty of the
country, either legislative, executive or judicial, attaches, for the time being,
to be exercised for the public benefit. Unless the powers conferred are of this
24
nature, the individual is not a public officer. The issue, therefore, is whether
the VFAs officers have been delegated some portion of the sovereignty of
the country, to be exercised for the public benefit.

(3) The VFP is required to submit annual reports of its proceedings for the
past year, including a full, complete and itemized report of receipts and

In several cases, we have dealt with the issue of whether certain specific
activities can be classified as sovereign functions. These cases, which deal

5. The DBM declared that the VFP is a non-government organization and

issued a certificate that the VFP has not been a direct recipient of any funds
released by the DBM.
These arguments of petitioner notwithstanding, we are constrained to rule
that petitioner is in fact a public corporation. Before responding to petitioners
allegations one by one, here are the more evident reasons why the VFP is a
public corporation:
(1) Rep. Act No. 2640 is entitled "An Act to Create a Public Corporation to be
Known as the Veterans Federation of the Philippines, Defining its Powers,
and for Other Purposes."

with activities not immediately apparent to be sovereign functions, upheld the

public sovereign nature of operations needed either to promote social
25
26
justice or to stimulate patriotic sentiments and love of country.
As regards the promotion of social justice as a sovereign function, we held in
Agricultural Credit and Cooperative Financing Administration (ACCFA) v.
Confederation of Unions in Government Corporations and Offices
27
(CUGCO), that the compelling urgency with which the Constitution speaks
of social justice does not leave any doubt that land reform is not an optional
but a compulsory function of sovereignty. The same reason was used in our
28
declaration that socialized housing is likewise a sovereign function. Highly
significant here is the observation of former Chief Justice Querube
Makalintal:
The growing complexities of modern society, however, have rendered this
traditional classification of the functions of government [into constituent and
ministrant functions] quite unrealistic, not to say obsolete. The areas which
used to be left to private enterprise and initiative and which the government
was called upon to enter optionally, and only "because it was better equipped
to administer for the public welfare than is any private individual or group of
individuals," continue to lose their well-defined boundaries and to be
absorbed within activities that the government must undertake in its
sovereign capacity if it is to meet the increasing social challenges of the
times. Here[,] as almost everywhere else[,] the tendency is undoubtedly
towards a greater socialization of economic forces. Here, of course, this
development was envisioned, indeed adopted as a national policy, by the
Constitution itself in its declaration of principle concerning the promotion of
29
social justice. (Emphasis supplied.)
It was, on the other hand, the fact that the National Centennial Celebrations
was calculated to arouse and stimulate patriotic sentiments and love of
30
country that it was considered as a sovereign function in Laurel v. Desierto.
In Laurel, the Court then took its cue from a similar case in the United States
involving a Fourth of July fireworks display. The holding of the Centennial
Celebrations was held to be an executive function, as it was intended to
enforce Article XIV of the Constitution which provides for the conservation,
promotion and popularization of the nations historical and cultural heritage
and resources, and artistic relations.
In the case at bar, the functions of petitioner corporation enshrined in Section
31
4 of Rep. Act No. 2640 should most certainly fall within the category of
sovereign functions. The protection of the interests of war veterans is not
only meant to promote social justice, but is also intended to reward
patriotism. All of the functions in Section 4 concern the well-being of war
veterans, our countrymen who risked their lives and lost their limbs in fighting
for and defending our nation. It would be injustice of catastrophic proportions

to say that it is beyond sovereigntys power to reward the people who

defended her.
Like the holding of the National Centennial Celebrations, the functions of the
VFP are executive functions, designed to implement not just the provisions of
Rep. Act No. 2640, but also, and more importantly, the Constitutional
mandate for the State to provide immediate and adequate care, benefits and
other forms of assistance to war veterans and veterans of military
32
campaigns, their surviving spouses and orphans.
2. Petitioner claims that VFP funds are not public funds.
Petitioner claims that its funds are not public funds because no budgetary
appropriations or government funds have been released to the VFP directly
or indirectly from the DBM, and because VFP funds come from membership
dues and lease rentals earned from administering government lands
reserved for the VFP.
The fact that no budgetary appropriations have been released to the VFP
does not prove that it is a private corporation. The DBM indeed did not see it
fit to propose budgetary appropriations to the VFP, having itself believed that
33
the VFP is a private corporation. If the DBM, however, is mistaken as to its
conclusion regarding the nature of VFPs incorporation, its previous
assertions will not prevent future budgetary appropriations to the VFP. The
erroneous application of the law by public officers does not bar a subsequent
34
correct application of the law.
Nevertheless, funds in the hands of the VFP from whatever source are public
funds, and can be used only for public purposes. This is mandated by the
following provisions of Rep. Act No. 2640:
(1) Section 2 provides that the VFP can only "invest its funds for the
exclusive benefit of the Veterans of the Philippines;"
(2) Section 2 likewise provides that "(a)ny action or decision of
Federation or of the Supreme Council shall be subject to the approval of
Secretary of National Defense." Hence, all activities of the VFP to which
Supreme Council can apply its funds are subject to the approval of
Secretary of National Defense;

the
the
the
the

(3) Section 4 provides that "the Federation shall exist solely for the purposes
of a benevolent character, and not for the pecuniary benefit of its
members;"1avvphil.net
(4) Section 6 provides that all funds of the VFP in excess of operating
expenses are "reserved for disbursement, as the Supreme Council may

authorize, for the purposes stated in Section two of this Act;"

(5) Section 10 provides that "(a)ny donation or contribution which from time
to time may be made to the Federation by the Government of the Philippines
or any of its subdivisions, branches, offices, agencies or instrumentalities
shall be expended by the Supreme Council only for the purposes mentioned
in this Act."; and finally,
(6) Section 12 requires the submission of annual reports of VFP proceedings
for the past year, including a full, complete and itemized report of receipts
and expenditures of whatever kind, to the President of the Philippines or to
the Secretary of National Defense.
It is important to note here that the membership dues collected from the
individual members of VFPs affiliate organizations do not become public
funds while they are still funds of the affiliate organizations. A close reading
35
of Section 1 of Rep. Act No. 2640 reveals that what has been created as a
body corporate is not the individual membership of the affiliate organizations,
but merely the aggregation of the heads of the affiliate organizations. Thus,
only the money remitted by the affiliate organizations to the VFP partake in
the public nature of the VFP funds.
36

In Republic v. COCOFED, we held that the Coconut Levy Funds are public
funds because, inter alia, (1) they were meant to be for the benefit of the
coconut industry, one of the major industries supporting the national
economy, and its farmers; and (2) the very laws governing coconut levies
recognize their public character. The same is true with regard to the VFP
funds. No less public is the use for the VFP funds, as such use is limited to
the purposes of the VFP which we have ruled to be sovereign functions.
Likewise, the law governing VFP funds (Rep. Act No. 2640) recognizes the
public character of the funds as shown in the enumerated provisions above.
We also observed in the same COCOFED case that "(e)ven if the money is
allocated for a special purpose and raised by special means, it is still public
37
in character." In the case at bar, some of the funds were raised by even
more special means, as the contributions from affiliate organizations of the
VFP can hardly be regarded as enforced contributions as to be considered
taxes. They are more in the nature of donations which have always been
recognized as a source of public funding. Affiliate organizations of the VFP
cannot complain of their contributions becoming public funds upon the
receipt by the VFP, since they are presumed aware of the provisions of Rep.
Act No. 2640 which not only specifies the exclusive purposes for which VFP
funds can be used, but also provides for the regulation of such funds by the
national government through the Secretary of National Defense. There is
nothing wrong, whether legally or morally, from raising revenues through
non-traditional methods. As remarked by Justice Florentino Feliciano in his

38

concurring opinion in Kilosbayan, Incorporated v. Guingona, Jr. where he

explained that the funds raised by the On-line Lottery System were also
public in nature, thus:
x x x [T]he more successful the government is in raising revenues by nontraditional methods such as PAGCOR operations and privatization
measures, the lesser will be the pressure upon the traditional sources of
public revenues, i.e., the pocket books of individual taxpayers and importers.
Petitioner additionally harps on the inapplicability of the case of Laurel v.
39
Desierto which was cited by Respondents. Petitioner claims that among the
reasons National Centennial Commission Chair Salvador Laurel was
considered a public officer was the fact that his compensation was derived
from public funds. Having ruled that VFP funds from whatever source are
public funds, we can safely conclude that the Supreme Councils
compensation, taken as they are from VFP funds under the term "operating
expenses" in Section 6 of Rep. Act No. 2640, are derived from public funds.
The particular nomenclature of the compensation taken from VFP funds is
not even of relevance here. As we said in Laurel concerning compensation
as an element of public office:
Under particular circumstances, "compensation" has been held to include
allowance for personal expenses, commissions, expenses, fees, an
honorarium, mileage or traveling expenses, payments for services, restitution
40
or a balancing of accounts, salary, and wages.
3. Petitioner argues that it is a civilian federation where membership is
voluntary.
Petitioner claims that the Secretary of National Defense "historically did not
indulge in the direct or micromanagement of the VFP precisely because it is
41
essentially a civilian organization where membership is voluntary." This
reliance of petitioner on what has "historically" been done is erroneous, since
42
laws are not repealed by disuse, custom, or practice to the contrary.
Furthermore, as earlier stated, the erroneous application of the law by public
43
officers does not bar a subsequent correct application of the law.
Neither is the civilian nature of VFP relevant in this case. The Constitution
does not contain any prohibition, express or implied, against the grant of
control and/or supervision to the Secretary of National Defense over a civilian
organization. The Office of the Secretary of National Defense is itself a
civilian office, its occupant being an alter ego of the civilian Commander-inChief. This set-up is the manifestation of the constitutional principle that
44
civilian authority is, at all times, supreme over the military. There being no
such constitutional prohibition, the creation of a civilian public organization by
Rep. Act No. 2640 is not rendered invalid by its being placed under the

control and supervision of the Secretary of National Defense.

Petitioners stand that the VFP is a private corporation because membership
thereto is voluntary is likewise erroneous. As stated above, the membership
of the VFP is not the individual membership of the affiliate organizations, but
merely the aggregation of the heads of such affiliate organizations. These
heads forming the VFP then elect the Supreme Council and the other
45
officers, of this public corporation.
4. Petitioner claims that the Administrative Code of 1987 does not provide
that the VFP is an attached agency, and nor does it provide that it is an entity
under the control and supervision of the DND in the context of the provisions
of said code.
The Administrative Code, by giving definitions of the various entities covered
by it, acknowledges that its enumeration is not exclusive. The Administrative
Code could not be said to have repealed nor enormously modified Rep. Act
No. 2640 by implication, as such repeal or enormous modification by
46
implication is not favored in statutory construction.
5. Petitioner offers as evidence the DBM opinion that the VFP is a nongovernment organization in its certification that the VFP "has not been a
direct recipient of any funds released by the DBM."
Respondents claim that the supposed declaration of the DBM that petitioner
is a non-government organization is not persuasive, since DBM is not a
quasi-judicial agency. They aver that what we have said of the Bureau of
Local Government Finance (BLGF) in Philippine Long Distance Telephone
47
Company (PLDT) v. City of Davao can be applied to DBM:
In any case, it is contended, the ruling of the Bureau of Local Government
Finance (BLGF) that petitioners exemption from local taxes has been
restored is a contemporaneous construction of Section 23 [of R.A. No. 7925
and, as such, is entitled to great weight.
The ruling of the BLGF has been considered in this case. But unlike the
Court of Tax Appeals, which is a special court created for the purpose of
reviewing tax cases, the BLGF was created merely to provide consultative
services and technical assistance to local governments and the general
public on local taxation and other related matters. Thus, the rule that the
"Court will not set aside conclusions rendered by the CTA, which is, by the
very nature of its function, dedicated exclusively to the study and
consideration of tax problems and has necessarily developed an expertise on
the subject, unless there has been an abuse or improvident exercise of
authority" cannot apply in the case of the BLGF.

On this score, though, we disagree with respondents and hold that the
DBMs appraisal is considered persuasive. Respondents misread the PLDT
case in asserting that only quasi-judicial agencies determination can be
considered persuasive. What the PLDT case points out is that, for an
administrative agencys opinion to be persuasive, the administrative agency
involved (whether it has quasi-judicial powers or not) must be an expert in
the field they are giving their opinion on.
The DBM is indeed an expert on determining what the various government
agencies and corporations are. This determination is necessary for the DBM
to fulfill its mandate:
Sec. 2. Mandate. - The Department shall be responsible for the formulation
and implementation of the National Budget with the goal of attaining our
national socio-economic plans and objectives.
The Department shall be responsible for the efficient and sound utilization of
government funds and revenues to effectively achieve our country's
48
development objectives.
The persuasiveness of the DBM opinion has, however, been overcome by all
the previous explanations we have laid so far. It has also been eclipsed by
another similarly persuasive opinion, that of the Department of National
Defense embodied in Department Circular No. 04. The DND is clearly more
of an expert with respect to the determination of the entities under it, and its
Administrative Rules and Regulations are entitled to great respect and have
49
in their favor the presumption of legality.
The DBM opinion furthermore suffers from its lack of explanation and
justification in the "certification of non-receipt" where said opinion was given.
The DBM has not furnished, in said certification or elsewhere, an explanation
for its opinion that VFP is a non-government organization.
THE FATE OF DEPARTMENT CIRCULAR NO. 04
Our ruling that petitioner is a public corporation is determinative of whether or
not we should grant petitioners prayer to declare Department Circular No. 04
void.
Petitioner assails Department Circular No. 04 on the ground that it expanded
the scope of control and supervision beyond what has been laid down in
Rep. Act No. 2640. Petitioner alleges that "(t)he equation of the meaning of
`control and `supervision of the Administrative Code of 1987 as the same
`control and supervision under Rep. Act No. 2640, takes out the context of
the original legislative intent from the peculiar surrounding circumstances and
50
conditions that brought about the creation of the VFP." Petitioner claims

that the VFP "was intended as a self-governing autonomous body with a

Supreme Council as governing authority," and that the assailed circular "preempts VFPs original self-governance and autonomy (in) representing
veterans organizations, and substitutes government discretion and decisions
51
to that of the veterans own determination." Petitioner says that the
circulars provisions practically render the Supreme Council inutile, despite its
52
being the statutory governing body of the VFP.
As previously mentioned, this Court has defined the power of control as "the
power of an officer to alter or modify or nullify or set aside what a subordinate
has done in the performance of his duties and to substitute the judgment of
53
the former to that of the latter." The power of supervision, on the other
hand, means "overseeing, or the power or authority of an officer to see that
54
subordinate officers perform their duties." Under the Administrative Code of
55
1987:

are merely consequences of both the power of control and supervision

granted by Rep. Act No. 2640. The power to alter or modify or nullify or set
aside what a subordinate has done in the performance of his duties, or to see
to it that subordinate officers perform their duties in accordance with law,
necessarily requires the ability of the superior officer to monitor, as closely as
it desires, the acts of the subordinate.
The same is true with respect to Sections 4 and 5 of the assailed Department
Circular No. 04, which requires the preservation of the records of the
Federation and the submission to the Secretary of National Defense of
annual and periodic reports.
Petitioner likewise claims that the assailed DND Department Circular No. 04
57
was never published, and hence void. Respondents deny such non58
publication.

Supervision and control shall include the authority to act directly whenever a
specific function is entrusted by law or regulation to a subordinate; direct the
performance of duty; restrain the commission of acts; review, approve,
reverse or modify acts and decisions of subordinate officials or units;
determine priorities in the execution of plans and programs; and prescribe
standards, guidelines, plans and programs. x x x

We have put forth both the rule and the exception on the publication of
59
administrative rules and regulations in the case of Taada v. Tuvera:

The definition of the power of control and supervision under Section 2 of the
assailed Department Circular are synonymous with the foregoing definitions.
Consequently, and considering that petitioner is a public corporation, the
provisions of the assailed Department Circular No. 04 did not supplant nor
modify the provisions of Republic Act No. 2640, thus not violating the settled
rule that "all such (administrative) issuances must not override, but must
remain consistent and in harmony with the law they seek to apply or
implement. Administrative rules and regulations are intended to carry out,
56
neither to supplant nor to modify, the law."

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 on
guidelines to be followed by their subordinates in the performance of their
duties.

Section 3.2 of the assailed department circular, which authorizes the

Secretary of National Defense to "x x x personally or through a designated
representative, require the submission of reports, documents and other
papers regarding any or all of the Federations business functions, x x x."
as well as Section 3.3 which allows the Secretary of DND to
x x x [F]rom time to time issue guidelines, directives and other orders
governing vital government activities including, but not limited to, the conduct
of elections, the acquisition, management and dispositions of properties, the
accounting of funds, financial interests, stocks and bonds, corporate
investments, etc. and such other transactions which may affect the interests
of the veterans.

x x x Administrative rules and regulations must also be published if their

purpose is to enforce or implement existing law pursuant also to a valid
delegation.

Even assuming that the assailed circular was not published, its validity is not
affected by such non-publication for the reason that its provisions fall under
two of the exceptions enumerated in Taada.
Department Circular No. 04 is an internal regulation. As we have ruled, they
are meant to regulate a public corporation under the control of DND, and not
the public in general. As likewise discussed above, what has been created as
a body corporate by Rep. Act No. 2640 is not the individual membership of
the affiliate organizations of the VFP, but merely the aggregation of the
heads of the affiliate organizations. Consequently, the individual members of
the affiliate organizations, who are not public officers, are beyond the
regulation of the circular.
Sections 2, 3 and 6 of the assailed circular are additionally merely
interpretative in nature. They add nothing to the law. They do not affect the
substantial rights of any person, whether party to the case at bar or not. In

Sections 2 and 3, control and supervision are defined, mentioning actions

that can be performed as consequences of such control and supervision, but
without specifying the particular actions that shall be rendered to control and
supervise the VFP. Section 6, in the same vein, merely state what the
drafters of the circular perceived to be consequences of being an attached
agency to a regular department of the government, enumerating sanctions
and remedies provided by law that may be availed of whenever desired.
Petitioner then objects to the implementation of Sec. 3.4 of the assailed
Department Circular, which provides that

the control and supervision of the Secretary of National Defense, who

consequently has the power to conduct an extensive management audit of
petitioner corporation.

WHEREFORE, the Petition is hereby DISMISSED for lack of merit. The

validity of the Department of National Defense Department Circular No. 04 is
AFFIRMED.
SO ORDERED.

3.4 Financial transactions of the Federation shall follow the provisions of the
government auditing code (PD 1445) i.e. government funds shall be spent or
used for public purposes; trust funds shall be available and may be spent
only for the specific purpose for which the trust was created or the funds
received; fiscal responsibility shall, to the greatest extent, be shared by all
those exercising authority over the financial affairs, transactions, and
operations of the federation; disbursements or dispositions of government
funds or property shall invariably bear the approval of the proper officials.
Since we have also previously determined that VFP funds are public funds,
there is likewise no reason to declare this provision invalid. Section 3.4 is
correct in requiring the VFP funds to be used for public purposes, but only
insofar the term "public purposes" is construed to mean "public purposes
enumerated in Rep. Act No. 2640."
Having in their possession public funds, the officers of the VFP, especially its
fiscal officers, must indeed share in the fiscal responsibility to the greatest
extent.
As to petitioners allegation that VFP was intended as a self-governing
autonomous body with a Supreme Council as governing authority, we find
that the provisions of Rep. Act No. 2640 concerning the control and
supervision of the Secretary of National Defense clearly withholds from the
VFP complete autonomy. To say, however, that such provisions render the
VFP inutile is an exaggeration. An office is not rendered inutile by the fact
that it is placed under the control of a higher office. These subordinate
offices, such as the executive offices under the control of the President,
exercise discretion at the first instance. While their acts can be altered or
even set aside by the superior, these acts are effective and are deemed the
acts of the superior until they are modified. Surely, we cannot say that the
offices of all the Department Secretaries are worthless positions.
In sum, the assailed DND Department Circular No. 04 does not supplant nor
modify and is, on the contrary, perfectly in consonance with Rep. Act No.
2640. Petitioner VFP is a public corporation. As such, it can be placed under

G.R. No. L-55963 December 1, 1989

SPOUSES JOSE FONTANILLA AND VIRGINIA FONTANILLA, petitioners,
vs.
HONORABLE INOCENCIO D. MALIAMAN and NATIONAL IRRIGATION
ADMINISTRATION, respondents.
G.R. No. L-61045 December 1, 1989
NATIONAL IRRIGATION ADMINISTRATION, appellant,
vs.
SPOUSES JOSE FONTANILLA and VIRGINIA FONTANILLA, appellees.

instituted by petitioners-spouses on April 17, 1978 against respondent NIA

before the then Court of First Instance of Nueva Ecija, Branch VIII at San
Jose City, for damages in connection with the death of their son resulting
from the aforestated accident.

Cecilio V. Suarez, Jr. for Spouses Fontanilla.

. . . . . Judgment is here rendered ordering the defendant National Irrigation

Administration to pay to the heirs of the deceased P12,000.00 for the death
of Francisco Fontanilla; P3,389.00 which the parents of the deceased had
spent for the hospitalization and burial of the deceased Francisco Fontanilla;
and to pay the costs. (Brief for the petitioners spouses Fontanilla, p. 4; Rollo,
p. 132)

Felicisimo C. Villaflor for NIA.

PARAS, J.:
In G.R. No. L-55963, the petition for review on certiorari seeks the affirmance
of the decision dated March 20, 1980 of the then Court of First Instance of
Nueva Ecija, Branch VIII, at San Jose City and its modification with respect
to the denial of petitioner's claim for moral and exemplary damages and
attorneys fees.
In G.R. No. 61045, respondent National Irrigation Administration seeks the
reversal of the aforesaid decision of the lower court. The original appeal of
this case before the Court of Appeals was certified to this Court and in the
resolution of July 7, 1982, it was docketed with the aforecited number. And in
the resolution of April 3, this case was consolidated with G.R. No. 55963.
It appears that on August 21, 1976 at about 6:30 P.M., a pickup owned and
operated by respondent National Irrigation Administration, a government
agency bearing Plate No. IN-651, then driven officially by Hugo Garcia, an
employee of said agency as its regular driver, bumped a bicycle ridden by
Francisco Fontanilla, son of herein petitioners, and Restituto Deligo, at
Maasin, San Jose City along the Maharlika Highway. As a result of the
impact, Francisco Fontanilla and Restituto Deligo were injured and brought to
the San Jose City Emergency Hospital for treatment. Fontanilla was later
transferred to the Cabanatuan Provincial Hospital where he died.
Garcia was then a regular driver of respondent National Irrigation
Administration who, at the time of the accident, was a licensed professional
driver and who qualified for employment as such regular driver of respondent
after having passed the written and oral examinations on traffic rules and
maintenance of vehicles given by National Irrigation Administration
authorities.
The within petition is thus an off-shot of the action (Civil Case No. SJC-56)

After trial, the trial court rendered judgment on March 20, 1980 which
directed respondent National Irrigation Administration to pay damages (death
benefits) and actual expenses to petitioners. The dispositive portion of the
decision reads thus:

Respondent National Irrigation Administration filed on April 21, 1980, its

motion for reconsideration of the aforesaid decision which respondent trial
court denied in its Order of June 13, 1980. Respondent National Irrigation
Administration thus appealed said decision to the Court of Appeals (C.A.G.R. No. 67237- R) where it filed its brief for appellant in support of its
position.
Instead of filing the required brief in the aforecited Court of Appeals case,
petitioners filed the instant petition with this Court.
The sole issue for the resolution of the Court is: Whether or not the award of
moral damages, exemplary damages and attorney's fees is legally proper in
a complaint for damages based on quasi-delict which resulted in the death of
the son of herein petitioners.
Petitioners allege:
1. The award of moral damages is specifically allowable. under paragraph 3
of Article 2206 of the New Civil Code which provides that the spouse,
legitimate and illegitimate descendants and ascendants of the deceased may
demand moral damages for mental anguish by reason of the death of the
deceased. Should moral damages be granted, the award should be made to
each of petitioners-spouses individually and in varying amounts depending
upon proof of mental and depth of intensity of the same, which should not be
less than P50,000.00 for each of them.
2. The decision of the trial court had made an impression that respondent
National Irrigation Administration acted with gross negligence because of the
accident and the subsequent failure of the National Irrigation Administration

personnel including the driver to stop in order to give assistance to the,

victims. Thus, by reason of the gross negligence of respondent, petitioners
become entitled to exemplary damages under Arts. 2231 and 2229 of the
New Civil Code.
3. Petitioners are entitled to an award of attorney's fees, the amount of which
(20%) had been sufficiently established in the hearing of May 23, 1979.
4. This petition has been filed only for the purpose of reviewing the findings
of the lower court upon which the disallowance of moral damages, exemplary
damages and attorney's fees was based and not for the purpose of
disturbing the other findings of fact and conclusions of law.
The Solicitor General, taking up the cudgels for public respondent National
Irrigation Administration, contends thus:

damages by reason of the shock and subsequent illness they suffered

because of the death of their son. Respondent National Irrigation
Administration, however, avers that it cannot be held liable for the damages
because it is an agency of the State performing governmental functions and
driver Hugo Garcia was a regular driver of the vehicle, not a special agent
who was performing a job or act foreign to his usual duties. Hence, the
liability for the tortious act should. not be borne by respondent government
agency but by driver Garcia who should answer for the consequences of his
act.
6. Even as the trial court touched on the failure or laxity of respondent
National Irrigation Administration in exercising due diligence in the selection
and supervision of its employee, the matter of due diligence is not an issue in
this case since driver Garcia was not its special agent but a regular driver of
the vehicle.

1. The filing of the instant petition is rot proper in view of the appeal taken by
respondent National Irrigation Administration to the Court of Appeals against
the judgment sought to be reviewed. The focal issue raised in respondent's
appeal to the Court of Appeals involves the question as to whether or not the
driver of the vehicle that bumped the victims was negligent in his operation of
said vehicle. It thus becomes necessary that before petitioners' claim for
moral and exemplary damages could be resolved, there should first be a
finding of negligence on the part of respondent's employee-driver. In this
regard, the Solicitor General alleges that the trial court decision does not
categorically contain such finding.

The sole legal question on whether or not petitioners may be entitled to an

award of moral and exemplary damages and attorney's fees can very well be
answered with the application of Arts. 2176 and 2180 of theNew Civil Code.

2. The filing of the "Appearance and Urgent Motion For Leave to File PlaintiffAppellee's Brief" dated December 28, 1981 by petitioners in the appeal (CAG.R. No. 67237-R; and G. R. No.61045) of the respondent National Irrigation
Administration before the Court of Appeals, is an explicit admission of said
petitioners that the herein petition, is not proper. Inconsistent procedures are
manifest because while petitioners question the findings of fact in the Court
of Appeals, they present only the questions of law before this Court which
posture confirms their admission of the facts.

Paragraphs 5 and 6 of Art. 21 80 read as follows:

3. The fact that the parties failed to agree on whether or not negligence
caused the vehicular accident involves a question of fact which petitioners
should have brought to the Court of Appeals within the reglementary period.
Hence, the decision of the trial court has become final as to the petitioners
and for this reason alone, the petition should be dismissed.
4. Respondent Judge acted within his jurisdiction, sound discretion and in
conformity with the law.
5. Respondents do not assail petitioners' claim to moral and exemplary

Art. 2176 thus provides:

Whoever by act omission causes damage to another, there being fault or
negligence, is obliged to pay for damage done. Such fault or negligence, if
there is no pre-existing cotractual relation between the parties, is called a
quasi-delict and is governed by the provisions of this Chapter

Employers shall be liable for the damages caused by their employees and
household helpers acting within the scope of their assigned tasks, even the
though the former are not engaged in any business or industry.
The State is responsible in like manner when it acts through a special agent.;
but not when the damage has been caused by the official to whom the task
done properly pertains, in which case what is provided in Art. 2176 shall be
applicable.
The liability of the State has two aspects. namely:
1. Its public or governmental aspects where it is liable for the tortious acts of
special agents only.
2. Its private or business aspects (as when it engages in private enterprises)
where it becomes liable as an ordinary employer. (p. 961, Civil Code of the
Philippines; Annotated, Paras; 1986 Ed. ).

In this jurisdiction, the State assumes a limited liability for the damage
caused by the tortious acts or conduct of its special agent.
Under the aforequoted paragrah 6 of Art. 2180, the State has voluntarily
assumed liability for acts done through special agents. The State's agent, if a
public official, must not only be specially commissioned to do a particular
task but that such task must be foreign to said official's usual governmental
functions. If the State's agent is not a public official, and is commissioned to
perform non-governmental functions, then the State assumes the role of an
ordinary employer and will be held liable as such for its agent's tort. Where
the government commissions a private individual for a special governmental
task, it is acting through a special agent within the meaning of the provision.
(Torts and Damages, Sangco, p. 347, 1984 Ed.)
Certain functions and activities, which can be performed only by the
government, are more or less generally agreed to be "governmental" in
character, and so the State is immune from tort liability. On the other hand, a
service which might as well be provided by a private corporation, and
particularly when it collects revenues from it, the function is considered a
"proprietary" one, as to which there may be liability for the torts of agents
within the scope of their employment.
The National Irrigation Administration is an agency of the government
exercising proprietary functions, by express provision of Rep. Act No. 3601.
Section 1 of said Act provides:
Section 1. Name and domicile.-A body corporate is hereby created which
shall be known as the National Irrigation Administration, hereinafter called
the NIA for short, which shall be organized immediately after the approval of
this Act. It shall have its principal seat of business in the City of Manila and
shall have representatives in all provinces for the proper conduct of its
business.
Section 2 of said law spells out some of the NIA's proprietary functions.
ThusSec. 2. Powers and objectives.-The NIA shall have the following powers and
objectives:
(a) x x x x x x x x x x x x x x x x x x
(b) x x x x x x x x x x x x x x x x x x
(c) To collect from the users of each irrigation system constructed by it such
fees as may be necessary to finance the continuous operation of the system
and reimburse within a certain period not less than twenty-five years cost of

construction thereof; and

(d) To do all such other tthings and to transact all such business as are
directly or indirectly necessary, incidental or conducive to the attainment of
the above objectives.
Indubitably, the NIA is a government corporation with juridical personality and
not a mere agency of the government. Since it is a corporate body
performing non-governmental functions, it now becomes liable for the
damage caused by the accident resulting from the tortious act of its driveremployee. In this particular case, the NIA assumes the responsibility of an
ordinary employer and as such, it becomes answerable for damages.
This assumption of liability, however, is predicated upon the existence of
negligence on the part of respondent NIA. The negligence referred to here is
the negligence of supervision.
At this juncture, the matter of due diligence on the part of respondent NIA
becomes a crucial issue in determining its liability since it has been
established that respondent is a government agency performing proprietary
functions and as such, it assumes the posture of an ordinary employer which,
under Par. 5 of Art. 2180, is responsible for the damages caused by its
employees provided that it has failed to observe or exercise due diligence in
the selection and supervision of the driver.
It will be noted from the assailed decision of the trial court that "as a result of
the impact, Francisco Fontanilla was thrown to a distance 50 meters away
from the point of impact while Restituto Deligo was thrown a little bit further
away. The impact took place almost at the edge of the cemented portion of
the road." (Emphasis supplied,) [page 26, Rollo]
The lower court further declared that "a speeding vehicle coming in contact
with a person causes force and impact upon the vehicle that anyone in the
vehicle cannot fail to notice. As a matter of fact, the impact was so strong as
shown by the fact that the vehicle suffered dents on the right side of the
radiator guard, the hood, the fender and a crack on the radiator as shown by
the investigation report (Exhibit "E"). (Emphasis supplied) [page 29, Rollo]
It should be emphasized that the accident happened along the Maharlika
National Road within the city limits of San Jose City, an urban area.
Considering the fact that the victim was thrown 50 meters away from the
point of impact, there is a strong indication that driver Garcia was driving at a
high speed. This is confirmed by the fact that the pick-up suffered substantial
and heavy damage as above-described and the fact that the NIA group was
then "in a hurry to reach the campsite as early as possible", as shown by
their not stopping to find out what they bumped as would have been their

normal and initial reaction.

Evidently, there was negligence in the supervision of the driver for the reason
that they were travelling at a high speed within the city limits and yet the
supervisor of the group, Ely Salonga, failed to caution and make the driver
observe the proper and allowed speed limit within the city. Under the
situation, such negligence is further aggravated by their desire to reach their
destination without even checking whether or not the vehicle suffered
damage from the object it bumped, thus showing imprudence and
reckelessness on the part of both the driver and the supervisor in the group.
Significantly, this Court has ruled that even if the employer can prove the
diligence in the selection and supervision (the latter aspect has not been
established herein) of the employee, still if he ratifies the wrongful acts, or
take no step to avert further damage, the employer would still be liable.
(Maxion vs. Manila Railroad Co., 44 Phil. 597).
Thus, too, in the case of Vda. de Bonifacio vs. B.L.T. Bus Co. (L-26810,
August 31, 1970, 34 SCRA 618), this Court held that a driver should be
especially watchful in anticipation of others who may be using the highway,
and his failure to keep a proper look out for reasons and objects in the line to
be traversed constitutes negligence.

Considering the foregoing, respondent NIA is hereby directed to pay herein

petitioners-spouses the amounts of P12,000.00 for the death of Francisco
Fontanilla; P3,389.00 for hospitalization and burial expenses of the
aforenamed deceased; P30,000.00 as moral damages; P8,000.00 as
exemplary damages and attorney's fees of 20% of the total award.
SO ORDERED.

G.R. No. 177131

June 7, 2011

BOY SCOUTS OF THE PHILIPPINES, Petitioner,

vs.
COMMISSION ON AUDIT, Respondent.

corporations belonging to the Educational, Social, Scientific, Civic and

Research Sector under the Corporate Audit Office I, to be audited, similar to
8
the subsidiary corporations, by employing the team audit approach.
(Emphases supplied.)
9

The BSP sought reconsideration of the COA Resolution in a letter dated

November 26, 1999 signed by the BSP National President Jejomar C. Binay,
who is now the Vice President of the Republic, wherein he wrote:

DECISION
LEONARDO-DE CASTRO, J.:
The jurisdiction of the Commission on Audit (COA) over the Boy Scouts of
the Philippines (BSP) is the subject matter of this controversy that reached
1
us via petition for prohibition filed by the BSP under Rule 65 of the 1997
Rules of Court. In this petition, the BSP seeks that the COA be prohibited
2
from implementing its June 18, 2002 Decision, its February 21, 2007
3
Resolution, as well as all other issuances arising therefrom, and that all of
4
the foregoing be rendered null and void.

It is the position of the BSP, with all due respect, that it is not subject to the
Commissions jurisdiction on the following grounds:
1. We reckon that the ruling in the case of Boy Scouts of the Philippines vs.
National Labor Relations Commission, et al. (G.R. No. 80767) classifying the
BSP as a government-controlled corporation is anchored on the "substantial
Government participation" in the National Executive Board of the BSP. It is to
be noted that the case was decided when the BSP Charter is defined by
Commonwealth Act No. 111 as amended by Presidential Decree 460.

Antecedent Facts and Background of the Case

5

This case arose when the COA issued Resolution No. 99-011 on August 19,
1999 ("the COA Resolution"), with the subject "Defining the Commissions
policy with respect to the audit of the Boy Scouts of the Philippines." In its
whereas clauses, the COA Resolution stated that the BSP was created as a
public corporation under Commonwealth Act No. 111, as amended by
Presidential Decree No. 460 and Republic Act No. 7278; that in Boy Scouts
6
of the Philippines v. National Labor Relations Commission, the Supreme
Court ruled that the BSP, as constituted under its charter, was a
"government-controlled corporation within the meaning of Article IX(B)(2)(1)
of the Constitution"; and that "the BSP is appropriately regarded as a
7
government instrumentality under the 1987 Administrative Code." The COA
Resolution also cited its constitutional mandate under Section 2(1), Article IX
(D). Finally, the COA Resolution reads:
NOW THEREFORE, in consideration of the foregoing premises, the
COMMISSION PROPER HAS RESOLVED, AS IT DOES HEREBY
RESOLVE, to conduct an annual financial audit of the Boy Scouts of the
Philippines in accordance with generally accepted auditing standards, and
express an opinion on whether the financial statements which include the
Balance Sheet, the Income Statement and the Statement of Cash Flows
present fairly its financial position and results of operations.

However, may we humbly refer you to Republic Act No. 7278 which
amended the BSPs charter after the cited case was decided. The most
salient of all amendments in RA No. 7278 is the alteration of the composition
of the National Executive Board of the BSP.
The said RA virtually eliminated the "substantial government participation" in
the National Executive Board by removing: (i) the President of the Philippines
and executive secretaries, with the exception of the Secretary of Education,
as members thereof; and (ii) the appointment and confirmation power of the
President of the Philippines, as Chief Scout, over the members of the said
Board.
The BSP believes that the cited case has been superseded by RA 7278.
Thereby weakening the cases conclusion that the BSP is a governmentcontrolled corporation (sic). The 1987 Administrative Code itself, of which the
BSP vs. NLRC relied on for some terms, defines government-owned and
controlled corporations as agencies organized as stock or non-stock
corporations which the BSP, under its present charter, is not.
Also, the Government, like in other GOCCs, does not have funds invested in
the BSP. What RA 7278 only provides is that the Government or any of its
subdivisions, branches, offices, agencies and instrumentalities can from time
to time donate and contribute funds to the BSP.

xxxx
xxxx
BE IT RESOLVED FURTHERMORE, that for purposes of audit supervision,
the Boy Scouts of the Philippines shall be classified among the government

Also the BSP respectfully believes that the BSP is not "appropriately

regarded as a government instrumentality under the 1987 Administrative

Code" as stated in the COA resolution. As defined by Section 2(10) of the
said code, 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."
The BSP is not an entity administering special funds. It is not even included
in the DECS National Budget. x x x
It may be argued also that the BSP is not an "agency" of the Government.
The 1987 Administrative Code, merely referred the BSP as an "attached
agency" of the DECS as distinguished from an actual line agency of
departments that are included in the National Budget. The BSP believes that
an "attached agency" is different from an "agency." Agency, as defined in
Section 2(4) of the Administrative Code, is defined as any of the various units
of the Government including a department, bureau, office, instrumentality,
government-owned or controlled corporation or local government or distinct
unit therein.
Under the above definition, the BSP is neither a unit of the Government; a
department which refers to an executive department as created by law
(Section 2[7] of the Administrative Code); nor a bureau which refers to any
principal subdivision or unit of any department (Section 2[8], Administrative
10
Code).
Subsequently, requests for reconsideration of the COA Resolution were also
made separately by Robert P. Valdellon, Regional Scout Director, Western
Visayas Region, Iloilo City and Eugenio F. Capreso, Council Scout Executive
11
of Calbayog City.
12

In a letter dated July 3, 2000, Director Crescencio S. Sunico, Corporate

Audit Officer (CAO) I of the COA, furnished the BSP with a copy of the
13
Memorandum dated June 20, 2000 of Atty. Santos M. Alquizalas, the COA
General Counsel. In said Memorandum, the COA General Counsel opined
that Republic Act No. 7278 did not supersede the Courts ruling in Boy
Scouts of the Philippines v. National Labor Relations Commission, even
though said law eliminated the substantial government participation in the
selection of members of the National Executive Board of the BSP. The
Memorandum further provides:
Analysis of the said case disclosed that the substantial government
participation is only one (1) of the three (3) grounds relied upon by the Court
in the resolution of the case. Other considerations include the character of
the BSPs purposes and functions which has a public aspect and the

statutory designation of the BSP as a "public corporation". These grounds

have not been deleted by R.A. No. 7278. On the contrary, these were
strengthened as evidenced by the amendment made relative to BSPs
purposes stated in Section 3 of R.A. No. 7278.
On the argument that BSP is not appropriately regarded as "a government
instrumentality" and "agency" of the government, such has already been
answered and clarified. The Supreme Court has elucidated this matter in the
BSP case when it declared that BSP is regarded as, both a "governmentcontrolled corporation with an original charter" and as an "instrumentality" of
the Government. Likewise, it is not disputed that the Administrative Code of
1987 designated the BSP as one of the attached agencies of DECS. Being
an attached agency, however, it does not change its nature as a
government-controlled corporation with original charter and, necessarily,
subject to COA audit jurisdiction. Besides, Section 2(1), Article IX-D of the
Constitution provides that COA shall have the power, authority, and duty to
examine, audit and settle all accounts pertaining to the revenue and receipts
of, and expenditures or uses of funds and property, owned or held in trust by,
or pertaining to, the Government, or any of its subdivisions, agencies or
instrumentalities, including government-owned or controlled corporations with
14
original charters.
Based on the Memorandum of the COA General Counsel, Director Sunico
wrote:
In view of the points clarified by said Memorandum upholding COA
Resolution No. 99-011, we have to comply with the provisions of the latter,
among which is to conduct an annual financial audit of the Boy Scouts of the
15
Philippines.
In a letter dated November 20, 2000 signed by Director Amorsonia B.
Escarda, CAO I, the COA informed the BSP that a preliminary survey of its
organizational structure, operations and accounting system/records shall be
16
conducted on November 21 to 22, 2000.
Upon the BSPs request, the audit was deferred for thirty (30) days. The BSP
then filed a Petition for Review with Prayer for Preliminary Injunction and/or
Temporary Restraining Order before the COA. This was denied by the COA
in its questioned Decision, which held that the BSP is under its audit
jurisdiction. The BSP moved for reconsideration but this was likewise denied
17
under its questioned Resolution.
This led to the filing by the BSP of this petition for prohibition with preliminary
injunction and temporary restraining order against the COA.
The Issue

As stated earlier, the sole issue to be resolved in this case is whether the
BSP falls under the COAs audit jurisdiction.

basis for the exercise of its jurisdiction and the issuance of COA Resolution
24
No. 99-011. The BSP further claims as follows:

The Parties Respective Arguments

It is not far-fetched, in fact, to concede that BSPs funds and assets are
private in character. Unlike ordinary public corporations, such as provinces,
cities, and municipalities, or government-owned and controlled corporations,
such as Land Bank of the Philippines and the Development Bank of the
Philippines, the assets and funds of BSP are not derived from any
government grant. For its operations, BSP is not dependent in any way on
any government appropriation; as a matter of fact, it has not even been
included in any appropriations for the government. To be sure, COA has not
alleged, in its Resolution No. 99-011 or in the Memorandum of its General
Counsel, that BSP received, receives or continues to receive assets and
funds from any agency of the government. The foregoing simply point to the
private nature of the funds and assets of petitioner BSP.

The BSP contends that Boy Scouts of the Philippines v. National Labor
Relations Commission is inapplicable for purposes of determining the audit
jurisdiction of the COA as the issue therein was the jurisdiction of the
National Labor Relations Commission over a case for illegal dismissal and
18
unfair labor practice filed by certain BSP employees.
While the BSP concedes that its functions do relate to those that the
government might otherwise completely assume on its own, it avers that this
alone was not determinative of the COAs audit jurisdiction over it. The BSP
further avers that the Court in Boy Scouts of the Philippines v. National Labor
Relations Commission "simply stated x x x that in respect of functions, the
BSP is akin to a public corporation" but this was not synonymous to holding
that the BSP is a government corporation or entity subject to audit by the
19
COA.
The BSP contends that Republic Act No. 7278 introduced crucial
amendments to its charter; hence, the findings of the Court in Boy Scouts of
the Philippines v. National Labor Relations Commission are no longer valid
as the government has ceased to play a controlling influence in it. The BSP
claims that the pronouncements of the Court therein must be taken only
within the context of that case; that the Court had categorically found that its
assets were acquired from the Boy Scouts of America and not from the
Philippine government, and that its operations are financed chiefly from
membership dues of the Boy Scouts themselves as well as from property
rentals; and that "the BSP may correctly be characterized as nongovernmental, and hence, beyond the audit jurisdiction of the COA." It further
claims that the designation by the Court of the BSP as a government agency
20
or instrumentality is mere obiter dictum.
The BSP maintains that the provisions of Republic Act No. 7278 suggest that
"governance of BSP has come to be overwhelmingly a private affair or
nature, with government participation restricted to the seat of the Secretary of
21
Education, Culture and Sports."
It cites Philippine Airlines Inc. v.
22
Commission on Audit wherein the Court declared that, "PAL, having
ceased to be a government-owned or controlled corporation is no longer
23
under the audit jurisdiction of the COA." Claiming that the amendments
introduced by Republic Act No. 7278 constituted a supervening event that
changed the BSPs corporate identity in the same way that the governments
privatization program changed PALs, the BSP makes the case that the
government no longer has control over it; thus, the COA cannot use the Boy
Scouts of the Philippines v. National Labor Relations Commission as its

xxxx
As stated in petitioners third argument, BSPs assets and funds were never
acquired from the government. Its operations are not in any way financed by
the government, as BSP has never been included in any appropriations act
for the government. Neither has the government invested funds with BSP.
BSP, has not been, at any time, a user of government property or funds; nor
have properties of the government been held in trust by BSP. This is
precisely the reason why, until this time, the COA has not attempted to
25
subject BSP to its audit jurisdiction. x x x.
To summarize its other arguments, the BSP contends that it is not a
government-owned or controlled corporation; neither is it an instrumentality,
agency, or subdivision of the government.
In its Comment,

26

the COA argues as follows:

1. The BSP is a public corporation created under Commonwealth Act No.

111 dated October 31, 1936, and whose functions relate to the fostering of
public virtues of citizenship and patriotism and the general improvement of
the moral spirit and fiber of the youth. The manner of creation and the
purpose for which the BSP was created indubitably prove that it is a
government agency.
2. Being a government agency, the funds and property owned or held in trust
by the BSP are subject to the audit authority of respondent Commission on
Audit pursuant to Section 2 (1), Article IX-D of the 1987 Constitution.
3. Republic Act No. 7278 did not change the character of the BSP as a
government-owned
or
controlled
corporation
and
government

instrumentality.

27

The COA maintains that the functions of the BSP that include, among others,
the teaching to the youth of patriotism, courage, self-reliance, and kindred
virtues, are undeniably sovereign functions enshrined under the Constitution
and discussed by the Court in Boy Scouts of the Philippines v. National
Labor Relations Commission. The COA contends that any attempt to classify
the BSP as a private corporation would be incomprehensible since no less
than the law which created it had designated it as a public corporation and its
28
statutory mandate embraces performance of sovereign functions.
The COA claims that the only reason why the BSP employees fell within the
scope of the Civil Service Commission even before the 1987 Constitution
was the fact that it was a government-owned or controlled corporation; that
as an attached agency of the Department of Education, Culture and Sports
(DECS), the BSP is an agency of the government; and that the BSP is a
chartered institution under Section 1(12) of the Revised Administrative Code
29
of 1987, embraced under the term government instrumentality.
The COA concludes that being a government agency, the funds and property
owned or held by the BSP are subject to the audit authority of the COA
pursuant to Section 2(1), Article IX (D) of the 1987 Constitution.
In support of its arguments, the COA cites The Veterans Federation of the
30
Philippines (VFP) v. Reyes, wherein the Court held that among the reasons
why the VFP is a public corporation is that its charter, Republic Act No. 2640,
designates it as one. Furthermore, the COA quotes the Court as saying in
that case:
In several cases, we have dealt with the issue of whether certain specific
activities can be classified as sovereign functions. These cases, which deal
with activities not immediately apparent to be sovereign functions, upheld the
public sovereign nature of operations needed either to promote social justice
or to stimulate patriotic sentiments and love of country.
xxxx
Petitioner claims that its funds are not public funds because no budgetary
appropriations or government funds have been released to the VFP directly
or indirectly from the DBM, and because VFP funds come from membership
dues and lease rentals earned from administering government lands
reserved for the VFP.
The fact that no budgetary appropriations have been released to the VFP
does not prove that it is a private corporation. The DBM indeed did not see it
fit to propose budgetary appropriations to the VFP, having itself believed that

the VFP is a private corporation. If the DBM, however, is mistaken as to its

conclusion regarding the nature of VFP's incorporation, its previous
assertions will not prevent future budgetary appropriations to the VFP. The
erroneous application of the law by public officers does not bar a subsequent
31
correct application of the law. (Citations omitted.)
The COA points out that the government is not precluded by law from
extending financial support to the BSP and adding to its funds, and that "as a
government instrumentality which continues to perform a vital function
imbued with public interest and reflective of the governments policy to
stimulate patriotic sentiments and love of country, the BSPs funds from
whatever source are public funds, and can be used solely for public purpose
32
in pursuance of the provisions of Republic Act No. [7278]."
The COA claims that the fact that it has not yet audited the BSPs funds may
not bar the subsequent exercise of its audit jurisdiction.
33

The BSP filed its Reply on August 29, 2007 maintaining that its statutory
designation as a "public corporation" and the public character of its purpose
and functions are not determinative of the COAs audit jurisdiction; reiterating
its stand that Boy Scouts of the Philippines v. National Labor Relations
Commission is not applicable anymore because the aspect of government
ownership and control has been removed by Republic Act No. 7278; and
concluding that the funds and property that it either owned or held in trust are
not public funds and are not subject to the COAs audit jurisdiction.
Thereafter, considering the BSPs claim that it is a private corporation, this
34
Court, in a Resolution dated July 20, 2010, required the parties to file,
within a period of twenty (20) days from receipt of said Resolution, their
respective comments on the issue of whether Commonwealth Act No. 111,
as amended by Republic Act No. 7278, is constitutional.
In compliance with the Courts resolution, the parties filed their respective
Comments.
35

In its Comment dated October 22, 2010, the COA argues that the
constitutionality of Commonwealth Act No. 111, as amended, is not
determinative of the resolution of the present controversy on the COAs audit
jurisdiction over petitioner, and in fact, the controversy may be resolved on
other grounds; thus, the requisites before a judicial inquiry may be made, as
36
set forth in Commissioner of Internal Revenue v. Court of Tax Appeals,
37
have not been fully met. Moreover, the COA maintains that behind every
38
law lies the presumption of constitutionality. The COA likewise argues that
39
contrary to the BSPs position, repeal of a law by implication is not favored.
Lastly, the COA claims that there was no violation of Section 16, Article XII of
the 1987 Constitution with the creation or declaration of the BSP as a

government corporation. Citing Philippine Society for the Prevention of

40
Cruelty to Animals v. Commission on Audit, the COA further alleges:
The true criterion, therefore, to determine whether a corporation is public or
private is found in the totality of the relation of the corporation to the State. If
the corporation is created by the State as the latters own agency or
instrumentality to help it in carrying out its governmental functions, then that
41
corporation is considered public; otherwise, it is private. x x x.
42

For its part, in its Comment filed on December 3, 2010, the BSP submits
that its charter, Commonwealth Act No. 111, as amended by Republic Act
No. 7278, is constitutional as it does not violate Section 16, Article XII of the
Constitution. The BSP alleges that "while [it] is not a public corporation within
the purview of COAs audit jurisdiction, neither is it a private corporation
created by special law falling within the ambit of the constitutional prohibition
43
x x x." The BSP further alleges:
Petitioners purpose is embodied in Section 3 of C.A. No. 111, as amended
by Section 1 of R.A. No. 7278, thus:
xxxx
A reading of the foregoing provision shows that petitioner was created to
advance the interest of the youth, specifically of young boys, and to mold
them into becoming good citizens. Ultimately, the creation of petitioner
redounds to the benefit, not only of those boys, but of the public good or
welfare. Hence, it can be said that petitioners purpose and functions are
more of a public rather than a private character. Petitioner caters to all boys
who wish to join the organization without any distinction. It does not limit its
membership to a particular class of boys. Petitioners members are trained in
scoutcraft and taught patriotism, civic consciousness and responsibility,
courage, self-reliance, discipline and kindred virtues, and moral values,
preparing them to become model citizens and outstanding leaders of the
44
country.
The BSP reiterates its stand that the public character of its purpose and
functions do not place it within the ambit of the audit jurisdiction of the COA
as it lacks the government ownership or control that the Constitution requires
45
before an entity may be subject of said jurisdiction. It avers that it merely
stated in its Reply that the withdrawal of government control is akin to
privatization, but it does not necessarily mean that petitioner is a private
46
corporation. The BSP claims that it has a unique characteristic which
47
"neither classifies it as a purely public nor a purely private corporation"; that
it is not a quasi-public corporation; and that it may belong to a different class
48
altogether.

The BSP claims that assuming arguendo that it is a private corporation, its
creation is not contrary to the purpose of Section 16, Article XII of the
Constitution; and that the evil sought to be avoided by said provision is
49
inexistent in the enactment of the BSPs charter, as, (i) it was not created
for any pecuniary purpose; (ii) those who will primarily benefit from its
creation are not its officers but its entire membership consisting of boys being
trained in scoutcraft all over the country; (iii) it caters to all boys who wish to
join the organization without any distinction; and (iv) it does not limit its
membership to a particular class or group of boys. Thus, the enactment of its
charter confers no special privilege to particular individuals, families, or
groups; nor does it bring about the danger of granting undue favors to certain
groups to the prejudice of others or of the interest of the country, which are
50
the evils sought to be prevented by the constitutional provision involved.
Finally, the BSP states that the presumption of constitutionality of a
legislative enactment prevails absent any clear showing of its repugnancy to
51
the Constitution.
The Ruling of the Court
After looking at the legislative history of its amended charter and carefully
studying the applicable laws and the arguments of both parties, we find that
the BSP is a public corporation and its funds are subject to the COAs audit
jurisdiction.
The BSP Charter (Commonwealth Act No. 111, approved on October 31,
1936), entitled "An Act to Create a Public Corporation to be Known as the
Boy Scouts of the Philippines, and to Define its Powers and Purposes"
created the BSP as a "public corporation" to serve the following public
interest or purpose:
Sec. 3. The purpose of this corporation shall be to promote through
organization and cooperation with other agencies, the ability of boys to do
useful things for themselves and others, to train them in scoutcraft, and to
inculcate in them patriotism, civic consciousness and responsibility, courage,
self-reliance, discipline and kindred virtues, and moral values, using the
method which are in common use by boy scouts.
Presidential Decree No. 460, approved on May 17, 1974, amended
Commonwealth Act No. 111 and provided substantial changes in the BSP
organizational structure. Pertinent provisions are quoted below:
Section II. Section 5 of the said Act is also amended to read as follows:
The governing body of the said corporation shall consist of a National
Executive Board composed of (a) the President of the Philippines or his

representative; (b) the charter and life members of the Boy Scouts of the
Philippines; (c) the Chairman of the Board of Trustees of the Philippine
Scouting Foundation; (d) the Regional Chairman of the Scout Regions of the
Philippines; (e) the Secretary of Education and Culture, the Secretary of
Social Welfare, the Secretary of National Defense, the Secretary of Labor,
the Secretary of Finance, the Secretary of Youth and Sports, and the
Secretary of Local Government and Community Development; (f) an equal
number of individuals from the private sector; (g) the National President of
the Girl Scouts of the Philippines; (h) one Scout of Senior age from each
Scout Region to represent the boy membership; and (i) three representatives
of the cultural minorities. Except for the Regional Chairman who shall be
elected by the Regional Scout Councils during their annual meetings, and the
Scouts of their respective regions, all members of the National Executive
Board shall be either by appointment or cooption, subject to ratification and
confirmation by the Chief Scout, who shall be the Head of State. Vacancies
in the Executive Board shall be filled by a majority vote of the remaining
members, subject to ratification and confirmation by the Chief Scout. The bylaws may prescribe the number of members of the National Executive Board
necessary to constitute a quorum of the board, which number may be less
than a majority of the whole number of the board. The National Executive
Board shall have power to make and to amend the by-laws, and, by a twothirds vote of the whole board at a meeting called for this purpose, may
authorize and cause to be executed mortgages and liens upon the property
of the corporation.

promote the purposes of said corporation: Provided, That said corporation

shall have no power to issue certificates of stock or to declare or pay
dividends, its objectives and purposes being solely of benevolent character
and not for pecuniary profit of its members.

Subsequently, on March 24, 1992, Republic Act No. 7278 further amended
Commonwealth Act No. 111 "by strengthening the volunteer and democratic
character" of the BSP and reducing government representation in its
governing body, as follows:

"(a) One (1) charter member of the Boy Scouts of the Philippines who shall
be elected by the members of the National Council at its meeting called for
this purpose;

Section 1. Sections 2 and 3 of Commonwealth Act. No. 111, as amended, is

hereby amended to read as follows:

"(b) The regional chairmen of the scout regions who shall be elected by the
representatives of all the local scout councils of the region during its meeting
called for this purpose: Provided, That a candidate for regional chairman
need not be the chairman of a local scout council;

"Sec. 2. The said corporation shall have the powers of perpetual succession,
to sue and be sued; to enter into contracts; to acquire, own, lease, convey
and dispose of such real and personal estate, land grants, rights and choses
in action as shall be necessary for corporate purposes, and to accept and
receive funds, real and personal property by gift, devise, bequest or other
means, to conduct fund-raising activities; to adopt and use a seal, and the
same to alter and destroy; to have offices and conduct its business and
affairs in Metropolitan Manila and in the regions, provinces, cities,
municipalities, and barangays of the Philippines, to make and adopt by-laws,
rules and regulations not inconsistent with this Act and the laws of the
Philippines, and generally to do all such acts and things, including the
establishment of regulations for the election of associates and successors,
as may be necessary to carry into effect the provisions of this Act and

"Sec. 3. The purpose of this corporation shall be to promote through

organization and cooperation with other agencies, the ability of boys to do
useful things for themselves and others, to train them in scoutcraft, and to
inculcate in them patriotism, civic consciousness and responsibility, courage,
self-reliance, discipline and kindred virtues, and moral values, using the
method which are in common use by boy scouts."
Sec. 2. Section 4 of Commonwealth Act No. 111, as amended, is hereby
repealed and in lieu thereof, Section 4 shall read as follows:
"Sec. 4. The President of the Philippines shall be the Chief Scout of the Boy
Scouts of the Philippines."
Sec. 3. Sections 5, 6, 7 and 8 of Commonwealth Act No. 111, as amended,
are hereby amended to read as follows:
"Sec. 5. The governing body of the said corporation shall consist of a
National Executive Board, the members of which shall be Filipino citizens of
good moral character. The Board shall be composed of the following:

"(c) The Secretary of Education, Culture and Sports;

"(d) The National President of the Girl Scouts of the Philippines;
"(e) One (1) senior scout, each from Luzon, Visayas and Mindanao areas, to
be elected by the senior scout delegates of the local scout councils to the
scout youth forums in their respective areas, in its meeting called for this
purpose, to represent the boy scout membership;
"(f) Twelve (12) regular members to be elected by the members of the
National Council in its meeting called for this purpose;

"(g) At least ten (10) but not more than fifteen (15) additional members from
the private sector who shall be elected by the members of the National
Executive Board referred to in the immediately preceding paragraphs (a), (b),
(c), (d), (e) and (f) at the organizational meeting of the newly reconstituted
National Executive Board which shall be held immediately after the meeting
of the National Council wherein the twelve (12) regular members and the one
(1) charter member were elected.

underscoring supplied.)

xxxx

Section 13. The State recognizes the vital role of the youth in nation-building
and shall promote and protect their physical, moral, spiritual, intellectual, and
social well-being. It shall inculcate in the youth patriotism and nationalism,
and encourage their involvement in public and civic affairs.

"Sec. 8. Any donation or contribution which from time to time may be made
to the Boy Scouts of the Philippines by the Government or any of its
subdivisions, branches, offices, agencies or instrumentalities or by a foreign
government or by private, entities and individuals shall be expended by the
National Executive Board in pursuance of this Act.
The BSP as a Public Corporation under Par. 2, Art. 2 of the Civil Code
There are three classes of juridical persons under Article 44 of the Civil Code
and the BSP, as presently constituted under Republic Act No. 7278, falls
under the second classification. Article 44 reads:
Art. 44. The following are juridical persons:
(1) The State and its political subdivisions;

The purpose of the BSP as stated in its amended charter shows that it was
created in order to implement a State policy declared in Article II, Section 13
of the Constitution, which reads:
ARTICLE II - DECLARATION OF PRINCIPLES AND STATE POLICIES

Evidently, the BSP, which was created by a special law to serve a public
purpose in pursuit of a constitutional mandate, comes within the class of
"public corporations" defined by paragraph 2, Article 44 of the Civil Code and
governed by the law which creates it, pursuant to Article 45 of the same
Code.
The BSPs Classification Under the Administrative Code of 1987
The public, rather than private, character of the BSP is recognized by the fact
that, along with the Girl Scouts of the Philippines, it is classified as an
attached agency of the DECS under Executive Order No. 292, or the
Administrative Code of 1987, which states:

(2) Other corporations, institutions and entities for public interest or

purpose created by law; their personality begins as soon as they have
been constituted according to law;

TITLE VI EDUCATION, CULTURE AND SPORTS

(3) Corporations, partnerships and associations for private interest or

purpose to which the law grants a juridical personality, separate and distinct
from that of each shareholder, partner or member. (Emphases supplied.)

SEC. 20. Attached Agencies. The following agencies are hereby attached
to the Department:

Chapter 8 Attached Agencies

xxxx
The BSP, which is a corporation created for a public interest or purpose, is
subject to the law creating it under Article 45 of the Civil Code, which
provides:

(12) Boy Scouts of the Philippines;

(13) Girl Scouts of the Philippines.

Art. 45. Juridical persons mentioned in Nos. 1 and 2 of the preceding

article are governed by the laws creating or recognizing them.
Private corporations are regulated by laws of general application on the
subject.
Partnerships and associations for private interest or purpose are governed by
the provisions of this Code concerning partnerships. (Emphasis and

The administrative relationship of an attached agency to the department is

defined in the Administrative Code of 1987 as follows:
BOOK IV
THE EXECUTIVE BRANCH

Chapter 7 ADMINISTRATIVE RELATIONSHIP

SEC. 38. Definition of Administrative Relationship. Unless otherwise
expressly stated in the Code or in other laws defining the special
relationships of particular agencies, administrative relationships shall be
categorized and defined as follows:

protect Filipino enterprises against unfair foreign competition and trade

practices.
In the pursuit of these goals, all sectors of the economy and all regions of the
country shall be given optimum opportunity to develop. Private enterprises,
including corporations, cooperatives, and similar collective organizations,
shall be encouraged to broaden the base of their ownership.

xxxx
(3) Attachment. (a) This refers to the lateral relationship between the
department or its equivalent and the attached agency or corporation for
purposes of policy and program coordination. The coordination may be
accomplished by having the department represented in the governing board
of the attached agency or corporation, either as chairman or as a member,
with or without voting rights, if this is permitted by the charter; having the
attached corporation or agency comply with a system of periodic reporting
which shall reflect the progress of programs and projects; and having the
department or its equivalent provide general policies through its
representative in the board, which shall serve as the framework for the
internal policies of the attached corporation or agency. (Emphasis ours.)
As an attached agency, the BSP enjoys operational autonomy, as long as
policy and program coordination is achieved by having at least one
representative of government in its governing board, which in the case of the
BSP is the DECS Secretary. In this sense, the BSP is not under government
control or "supervision and control." Still this characteristic does not make the
attached chartered agency a private corporation covered by the constitutional
proscription in question.
Art. XII, Sec. 16 of the Constitution refers to "private corporations"
created by government for proprietary or economic/business purposes
At the outset, it should be noted that the provision of Section 16 in issue is
found in Article XII of the Constitution, entitled "National Economy and
Patrimony." Section 1 of Article XII is quoted as follows:
SECTION 1. The goals of the national economy are a more equitable
distribution of opportunities, income, and wealth; a sustained increase in the
amount of goods and services produced by the nation for the benefit of the
people; and an expanding productivity as the key to raising the quality of life
for all, especially the underprivileged.
The State shall promote industrialization and full employment based on
sound agricultural development and agrarian reform, through industries that
make full and efficient use of human and natural resources, and which are
competitive in both domestic and foreign markets. However, the State shall

The scope and coverage of Section 16, Article XII of the Constitution can be
seen from the aforementioned declaration of state policies and goals which
pertains to national economy and patrimony and the interests of the people in
economic development.
Section 16, Article XII deals with "the formation, organization, or regulation of
52
private corporations," which should be done through a general law enacted
by Congress, provides for an exception, that is: if the corporation is
government owned or controlled; its creation is in the interest of the common
good; and it meets the test of economic viability. The rationale behind Article
XII, Section 16 of the 1987 Constitution was explained in Feliciano v.
53
Commission on Audit, in the following manner:
The Constitution emphatically prohibits the creation of private corporations
except by a general law applicable to all citizens. The purpose of this
constitutional provision is to ban private corporations created by special
charters, which historically gave certain individuals, families or groups special
54
privileges denied to other citizens. (Emphasis added.)
It may be gleaned from the above discussion that Article XII, Section 16 bans
the creation of "private corporations" by special law. The said constitutional
provision should not be construed so as to prohibit the creation of public
corporations or a corporate agency or instrumentality of the government
intended to serve a public interest or purpose, which should not be measured
on the basis of economic viability, but according to the public interest or
purpose it serves as envisioned by paragraph (2), of Article 44 of the Civil
Code and the pertinent provisions of the Administrative Code of 1987.
The BSP is a Public Corporation Not Subject to the Test of Government
Ownership or Control and Economic Viability
The BSP is a public corporation or a government agency or instrumentality
with juridical personality, which does not fall within the constitutional
prohibition in Article XII, Section 16, notwithstanding the amendments to its
charter. Not all corporations, which are not government owned or controlled,
are ipso facto to be considered private corporations as there exists another
distinct class of corporations or chartered institutions which are otherwise
known as "public corporations." These corporations are treated by law as

agencies or instrumentalities of the government which are not subject to the

tests of ownership or control and economic viability but to different criteria
relating to their public purposes/interests or constitutional policies and
objectives and their administrative relationship to the government or any of
its Departments or Offices.
Classification of Corporations Under Section 16, Article XII of the Constitution
on National Economy and Patrimony
The dissenting opinion of Associate Justice Antonio T. Carpio, citing a line of
cases, insists that the Constitution recognizes only two classes of
corporations: private corporations under a general law, and governmentowned or controlled corporations created by special charters.

Government including a department, bureau, office, instrumentality,

government-owned or -controlled corporation, or local government or distinct
unit therein. "Government instrumentality" is in turn defined in the 1987
Administrative Code in the following manner:
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.
The same Code describes a "chartered institution" in the following terms:

We strongly disagree. Section 16, Article XII should not be construed so as

to prohibit Congress from creating public corporations. In fact, Congress has
enacted numerous laws creating public corporations or government agencies
or instrumentalities vested with corporate powers. Moreover, Section 16,
Article XII, which relates to National Economy and Patrimony, could not have
tied the hands of Congress in creating public corporations to serve any of the
constitutional policies or objectives.

Chartered institution - refers to any agency organized or operating under a

special charter, and vested by law with functions relating to specific
constitutional policies or objectives. This term includes the state universities
and colleges, and the monetary authority of the State.

In his dissent, Justice Carpio contends that this ponente introduces "a totally
different species of corporation, which is neither a private corporation nor a
government owned or controlled corporation" and, in so doing, is missing the
fact that the BSP, "which was created as a non-stock, non-profit corporation,
can only be either a private corporation or a government owned or controlled
corporation."

It thus appears that the BSP may be regarded as both a "government

controlled corporation with an original charter" and as an "instrumentality" of
the Government within the meaning of Article IX (B) (2) (1) of the
55
Constitution. x x x. (Emphases supplied.)

Note that in Boy Scouts of the Philippines v. National Labor Relations

Commission, the BSP, under its former charter, was regarded as both a
government owned or controlled corporation with original charter and a
"public corporation." The said case pertinently stated:
While the BSP may be seen to be a mixed type of entity, combining aspects
of both public and private entities, we believe that considering the character
of its purposes and its functions, the statutory designation of the BSP as "a
public corporation" and the substantial participation of the Government in the
selection of members of the National Executive Board of the BSP, the BSP,
as presently constituted under its charter, is a government-controlled
corporation within the meaning of Article IX (B) (2) (1) of the Constitution.
We are fortified in this conclusion when we note that the Administrative Code
of 1987 designates the BSP as one of the attached agencies of the
Department of Education, Culture and Sports ("DECS"). An "agency of the
Government" is defined as referring to any of the various units of the

We believe that the BSP is appropriately regarded as "a government

instrumentality" under the 1987 Administrative Code.

The existence of public or government corporate or juridical entities or

chartered institutions by legislative fiat distinct from private corporations and
government owned or controlled corporation is best exemplified by the 1987
Administrative Code cited above, which we quote in part:
Sec. 2. General Terms Defined. Unless the specific words of the text, or
the context as a whole, or a particular statute, shall require a different
meaning:
xxxx
(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.
xxxx

(12) "Chartered institution" refers to any agency organized or operating under

a special charter, and vested by law with functions relating to specific
constitutional policies or objectives. This term includes the state universities
and colleges and the monetary authority of the State.
(13) "Government-owned or controlled corporation" refers to any agency
organized as a stock or non-stock corporation, vested with functions relating
to public needs whether governmental or proprietary in nature, and owned by
the Government directly or through its instrumentalities either wholly, or,
where applicable as in the case of stock corporations, to the extent of at least
fifty-one (51) per cent of its capital stock: Provided, That government-owned
or controlled corporations may be further categorized by the Department of
the Budget, the Civil Service Commission, and the Commission on Audit for
purposes of the exercise and discharge of their respective powers, functions
and responsibilities with respect to such corporations.
Assuming for the sake of argument that the BSP ceases to be owned or
controlled by the government because of reduction of the number of
representatives of the government in the BSP Board, it does not follow that it
also ceases to be a government instrumentality as it still retains all the
characteristics of the latter as an attached agency of the DECS under the
Administrative Code. Vesting corporate powers to an attached agency or
instrumentality of the government is not constitutionally prohibited and is
allowed by the above-mentioned provisions of the Civil Code and the 1987
Administrative Code.

THE PRESIDENT. Commissioner Foz is recognized.

MR. FOZ. Madam President, I support the proposal to insert "ECONOMIC
VIABILITY" as one of the grounds for organizing government corporations. x
x x.
MR. OPLE. Madam President, the reason for this concern is really that when
the government creates a corporation, there is a sense in which this
corporation becomes exempt from the test of economic performance. We
know what happened in the past. If a government corporation loses, then it
makes its claim upon the taxpayers money through new equity infusions
from the government and what is always invoked is the common good. x x x
Therefore, when we insert the phrase "ECONOMIC VIABILITY" together with
the "common good," this becomes a restraint on future enthusiasts for state
capitalism to excuse themselves from the responsibility of meeting the
market test so that they become viable. x x x.
xxxx
THE PRESIDENT. Commissioner Quesada is recognized.
MS. QUESADA. Madam President, may we be clarified by the committee on
what is meant by economic viability?
THE PRESIDENT. Please proceed.

Economic Viability and Ownership and Control Tests Inapplicable to Public

Corporations
As presently constituted, the BSP still remains an instrumentality of the
national government. It is a public corporation created by law for a public
purpose, attached to the DECS pursuant to its Charter and the Administrative
Code of 1987. It is not a private corporation which is required to be owned or
controlled by the government and be economically viable to justify its
existence under a special law.
The dissent of Justice Carpio also submits that by recognizing "a new class
of public corporation(s)" created by special charter that will not be subject to
the test of economic viability, the constitutional provision will be
circumvented.
However, a review of the Record of the 1986 Constitutional Convention
reveals the intent of the framers of the highest law of our land to distinguish
between government corporations performing governmental functions and
corporations involved in business or proprietary functions:

MR. MONSOD. Economic viability normally is determined by cost-benefit

ratio that takes into consideration all benefits, including economic external as
well as internal benefits. These are what they call externalities in economics,
so that these are not strictly financial criteria. Economic viability involves
what we call economic returns or benefits of the country that are not
quantifiable in financial terms. x x x.
xxxx
MS. QUESADA. So, would this particular formulation now really limit the
entry of government corporations into activities engaged in by corporations?
MR. MONSOD. Yes, because it is also consistent with the economic
philosophy that this Commission approved that there should be minimum
government participation and intervention in the economy.
MS. QUESDA. Sometimes this Commission would just refer to Congress to
provide the particular requirements when the government would get into
corporations. But this time around, we specifically mentioned economic

viability. x x x.

under a general law?

MR. VILLEGAS. Commissioner Ople will restate the reason for his
introducing that amendment.

MR. MONSOD. Madam President, x x x. There are two types of government

corporations those that are involved in performing governmental functions,
like garbage disposal, Manila waterworks, and so on; and those government
corporations that are involved in business functions. As we said earlier, there
are two criteria that should be followed for corporations that want to go into
business. First is for government corporations to first prove that they can be
efficient in the areas of their proper functions. This is one of the problems
now because they go into all kinds of activities but are not even efficient in
their proper functions. Secondly, they should not go into activities that the
private sector can do better.

MR. OPLE. I am obliged to repeat what I said earlier in moving for this
particular amendment jointly with Commissioner Foz. During the past three
decades, there had been a proliferation of government corporations, very few
of which have succeeded, and many of which are now earmarked by the
Presidential Reorganization Commission for liquidation because they failed
the economic test. x x x.
xxxx
MS. QUESADA. But would not the Commissioner say that the reason why
many of the government-owned or controlled corporations failed to come up
with the economic test is due to the management of these corporations, and
not the idea itself of government corporations? It is a problem of efficiency
and effectiveness of management of these corporations which could be
remedied, not by eliminating government corporations or the idea of getting
into state-owned corporations, but improving management which our
technocrats should be able to do, given the training and the experience.
MR. OPLE. That is part of the economic viability, Madam President.
MS. QUESADA. So, is the Commissioner saying then that the Filipinos will
benefit more if these government-controlled corporations were given to
private hands, and that there will be more goods and services that will be
affordable and within the reach of the ordinary citizens?
MR. OPLE. Yes. There is nothing here, Madam President, that will prevent
the formation of a government corporation in accordance with a special
charter given by Congress. However, we are raising the standard a little bit
so that, in the future, corporations established by the government will meet
the test of the common good but within that framework we should also build a
certain standard of economic viability.

MR. PADILLA. There is no question about corporations performing

governmental functions or functions that are impressed with public interest.
But the question is with regard to matters that are covered, perhaps not
exhaustively, by private enterprise. It seems that under this provision the only
qualification is economic viability and common good, but shall government,
through government-controlled corporations, compete with private
enterprise?
MR. MONSOD. No, Madam President. As we said, the government should
not engage in activities that private enterprise is engaged in and can do
56
better. x x x. (Emphases supplied.)
Thus, the test of economic viability clearly does not apply to public
corporations dealing with governmental functions, to which category the BSP
belongs. The discussion above conveys the constitutional intent not to apply
this constitutional ban on the creation of public corporations where the
economic viability test would be irrelevant. The said test would only apply if
the corporation is engaged in some economic activity or business function for
the government.
It is undisputed that the BSP performs functions that are impressed with
public interest. In fact, during the consideration of the Senate Bill that
eventually became Republic Act No. 7278, which amended the BSP Charter,
one of the bills sponsors, Senator Joey Lina, described the BSP as follows:

xxxx
THE PRESIDENT. Commissioner Padilla is recognized.
MR. PADILLA. This is an inquiry to the committee. With regard to
corporations created by a special charter for government-owned or controlled
corporations, will these be in the pioneer fields or in places where the private
enterprise does not or cannot enter? Or is this so general that these
government corporations can compete with private corporations organized

Senator Lina. Yes, I can only think of two organizations involving the masses
of our youth, Mr. President, that should be given this kind of a privilege the
Boy Scouts of the Philippines and the Girl Scouts of the Philippines. Outside
of these two groups, I do not think there are other groups similarly situated.
The Boy Scouts of the Philippines has a long history of providing value
formation to our young, and considering how huge the population of the
young people is, at this point in time, and also considering the importance of

having an organization such as this that will inculcate moral uprightness

among the young people, and further considering that the development of
these young people at that tender age of seven to sixteen is vital in the
development of the country producing good citizens, I believe that we can
make an exception of the Boy Scouting movement of the Philippines from
57
this general prohibition against providing tax exemption and privileges.
Furthermore, this Court cannot agree with the dissenting opinion which
equates the changes introduced by Republic Act No. 7278 to the BSP
Charter as clear manifestation of the intent of Congress "to return the BSP to
the private sector." It was not the intent of Congress in enacting Republic Act
No. 7278 to give up all interests in this basic youth organization, which has
been its partner in forming responsible citizens for decades.
In fact, as may be seen in the deliberation of the House Bills that eventually
resulted to Republic Act No. 7278, Congress worked closely with the BSP to
rejuvenate the organization, to bring it back to its former glory reached under
its original charter, Commonwealth Act No. 111, and to correct the perceived
ills introduced by the amendments to its Charter under Presidential Decree
No. 460. The BSP suffered from low morale and decrease in number
because the Secretaries of the different departments in government who
were too busy to attend the meetings of the BSPs National Executive Board
("the Board") sent representatives who, as it turned out, changed from
meeting to meeting. Thus, the Scouting Councils established in the provinces
and cities were not in touch with what was happening on the national level,
58
but they were left to implement what was decided by the Board.
A portion of the legislators discussion is quoted below to clearly show their
intent:
HON. DEL MAR. x x x I need not mention to you the value and the
tremendous good that the Boy Scout Movement has done not only for the
youth in particular but for the country in general. And that is why, if we look
around, our past and present national leaders, prominent men in the various
fields of endeavor, public servants in government offices, and civic leaders in
the communities all over the land, and not only in our country but all over the
world many if not most of them have at one time or another been
beneficiaries of the Scouting Movement. And so, it is along this line, Mr.
Chairman, that we would like to have the early approval of this measure if
only to pay back what we owe much to the Scouting Movement. Now, going
to the meat of the matter, Mr. Chairman, if I may just the Scouting
Movement was enacted into law in October 31, 1936 under Commonwealth
Act No. 111. x x x [W]e were acknowledged as the third biggest scouting
organization in the world x x x. And to our mind, Mr. Chairman, this erratic
growth and this decrease in membership [number] is because of the bad
policy measures that were enunciated with the enactment or promulgation by

the President before of Presidential Decree No. 460 which we feel is the
culprit of the ills that is flagging the Boy Scout Movement today. And so, this
is specifically what we are attacking, Mr. Chairman, the disenfranchisement
of the National Council in the election of the national board. x x x. And so,
this is what we would like to be appraised of by the officers of the Boy
[Scouts] of the Philippines whom we are also confident, have the best
interest of the Boy Scout Movement at heart and it is in this spirit, Mr.
Chairman, that we see no impediment towards working together, the Boy
Scout of the Philippines officers working together with the House of
Representatives in coming out with a measure that will put back the vigor
59
and enthusiasm of the Boy Scout Movement. x x x. (Emphasis ours.)
The following is another excerpt from the discussion on the House version of
the bill, in the Committee on Government Enterprises:
HON. AQUINO: x x x Well, obviously, the two bills as well as the previous
laws that have created the Boy Scouts of the Philippines did not provide for
any direct government support by way of appropriation from the national
budget to support the activities of this organization. The point here is, and at
the same time they have been subjected to a governmental intervention,
which to their mind has been inimical to the objectives and to the institution
per se, that is why they are seeking legislative fiat to restore back the original
mandate that they had under Commonwealth Act 111. Such having been the
experience in the hands of government, meaning, there has been negative
interference on their part and inasmuch as their mandate is coming from a
legislative fiat, then shouldnt it be, this rhetorical question, shouldnt it be
better for this organization to seek a mandate from, lets say, the government
the Corporation Code of the Philippines and register with the SEC as nonprofit non-stock corporation so that government intervention could be very
very minimal. Maybe thats a rhetorical question, they may or they may not
answer, ano. I dont know what would be the benefit of a charter or a
mandate being provided for by way of legislation versus a registration with
the SEC under the Corporation Code of the Philippines inasmuch as they
dont get anything from the government anyway insofar as direct funding. In
fact, the only thing that they got from government was intervention in their
affairs. Maybe we can solicit some commentary comments from the resource
persons. Incidentally, dont take that as an objection, Im not objecting. Im all
for the objectives of these two bills. It just occurred to me that since you have
had very bad experience in the hands of government and you will always be
open to such possible intervention even in the future as long as you have a
legislative mandate or your mandate or your charter coming from legislative
action.
xxxx
MR. ESCUDERO: Mr. Chairman, there may be a disadvantage if the Boy

Scouts of the Philippines will be required to register with the SEC. If we are
registered with the SEC, there could be a danger of proliferation of scout
organization. Anybody can organize and then register with the SEC. If there
will be a proliferation of this, then the organization will lose control of the
entire organization. Another disadvantage, Mr. Chairman, anybody can file a
complaint in the SEC against the Boy Scouts of the Philippines and the SEC
may suspend the operation or freeze the assets of the organization and
hamper the operation of the organization. I dont know, Mr. Chairman, how
you look at it but there could be a danger for anybody filing a complaint
against the organization in the SEC and the SEC might suspend the
registration permit of the organization and we will not be able to operate.
HON. AQUINO: Well, that I think would be a problem that will not be
exclusive to corporations registered with the SEC because even if you are
government corporation, court action may be taken against you in other
judicial bodies because the SEC is simply another quasi-judicial body. But, I
think, the first point would be very interesting, the first point that you raised.
In effect, what you are saying is that with the legislative mandate creating
your charter, in effect, you have been given some sort of a franchise with this
movement.
MR. ESCUDERO: Yes.
HON. AQUINO: Exclusive franchise of that movement?
MR. ESCUDERO: Yes.
HON. AQUINO: Well, thats very well taken so I will proceed with other
60
issues, Mr. Chairman. x x x. (Emphases added.)
Therefore, even though the amended BSP charter did away with most of the
governmental presence in the BSP Board, this was done to more strongly
promote the BSPs objectives, which were not supported under Presidential
Decree No. 460. The BSP objectives, as pointed out earlier, are consistent
with the public purpose of the promotion of the well-being of the youth, the
future leaders of the country. The amendments were not done with the view
of changing the character of the BSP into a privatized corporation. The BSP
remains an agency attached to a department of the government, the DECS,
and it was not at all stripped of its public character.
The ownership and control test is likewise irrelevant for a public corporation
like the BSP. To reiterate, the relationship of the BSP, an attached agency, to
the government, through the DECS, is defined in the Revised Administrative
Code of 1987. The BSP meets the minimum statutory requirement of an
attached government agency as the DECS Secretary sits at the BSP Board
ex officio, thus facilitating the policy and program coordination between the

BSP and the DECS.

Requisites for Declaration of Unconstitutionality Not Met in this Case
The dissenting opinion of Justice Carpio improperly raised the issue of
unconstitutionality of certain provisions of the BSP Charter. Even if the
parties were asked to Comment on the validity of the BSP charter by the
Court, this alone does not comply with the requisites for judicial review, which
were clearly set forth in a recent case:
When questions of constitutional significance are raised, the Court can
exercise its power of judicial review only if the following requisites are
present: (1) the existence of an actual and appropriate case; (2) the
existence of personal and substantial interest on the part of the party raising
the constitutional question; (3) recourse to judicial review is made at the
earliest opportunity; and (4) the constitutional question is the lis mota of the
61
case. (Emphasis added.)
Thus, when it comes to the exercise of the power of judicial review, the
constitutional issue should be the very lis mota, or threshold issue, of the
case, and that it should be raised by either of the parties. These
requirements would be ignored under the dissents rather overreaching view
of how this case should have been decided. True, it was the Court that asked
the parties to comment, but the Court cannot be the one to raise a
constitutional issue. Thus, the Court chooses to once more exhibit restraint in
the exercise of its power to pass upon the validity of a law.
Re: the COAs Jurisdiction
Regarding the COAs jurisdiction over the BSP, Section 8 of its amended
charter allows the BSP to receive contributions or donations from the
government. Section 8 reads:
Section 8. Any donation or contribution which from time to time may be made
to the Boy Scouts of the Philippines by the Government or any of its
subdivisions, branches, offices, agencies or instrumentalities shall be
expended by the Executive Board in pursuance of this Act.lawph!1
The sources of funds to maintain the BSP were identified before the House
Committee on Government Enterprises while the bill was being deliberated,
and the pertinent portion of the discussion is quoted below:
MR. ESCUDERO. Yes, Mr. Chairman. The question is the sources of funds
of the organization. First, Mr. Chairman, the Boy Scouts of the Philippines do
not receive annual allotment from the government. The organization has to
raise its own funds through fund drives and fund campaigns or fund raising

activities. Aside from this, we have some revenue producing projects in the
organization that gives us funds to support the operation. x x x From time to
time, Mr. Chairman, when we have special activities we request for
assistance or financial assistance from government agencies, from private
business and corporations, but this is only during special activities that the
Boy Scouts of the Philippines would conduct during the year. Otherwise, we
62
have to raise our own funds to support the organization.
The nature of the funds of the BSP and the COAs audit jurisdiction were
likewise brought up in said congressional deliberations, to wit:
HON. AQUINO: x x x Insofar as this organization being a government
created organization, in fact, a government corporation classified as such,
are your funds or your finances subjected to the COA audit?
MR. ESCUDERO: Mr. Chairman, we are not. Our funds is not subjected. We
dont fall under the jurisdiction of the COA.
HON. AQUINO: All right, but before were you?
MR. ESCUDERO: No, Mr. Chairman.
MR. JESUS: May I? As historical backgrounder, Commonwealth Act 111 was
written by then Secretary Jorge Vargas and before and up to the middle of
the Martial Law years, the BSP was receiving a subsidy in the form of an
annual a one draw from the Sweepstakes. And, this was the case also with
the Girl Scouts at the Anti-TB, but then this was and the Boy Scouts then
because of this funding partly from government was being subjected to audit
in the contributions being made in the part of the Sweepstakes. But this was
removed later during the Martial Law years with the creation of the Human
Settlements Commission. So the situation right now is that the Boy Scouts
does not receive any funding from government, but then in the case of the
local councils and this legislative charter, so to speak, enables the local
councils even the national headquarters in view of the provisions in the
existing law to receive donations from the government or any of its
instrumentalities, which would be difficult if the Boy Scouts is registered as a
private corporation with the Securities and Exchange Commission.
Government bodies would be estopped from making donations to the Boy
Scouts, which at present is not the case because there is the Boy Scouts
charter, this Commonwealth Act 111 as amended by PD 463.
xxxx

HON. AMATONG: There is no auditing being made because theres no

money put in the organization, but how about donated funds to this
organization? What are the remedies of the donors of how will they know
how their money are being spent?
MR. ESCUDERO: May I answer, Mr. Chairman?
THE CHAIRMAN: Yes, gentleman.
MR. ESCUDERO: The Boy Scouts of the Philippines has an external auditor
and by the charter we are required to submit a financial report at the end of
each year to the National Executive Board. So all the funds donated or
otherwise is accounted for at the end of the year by our external auditor. In
63
this case the SGV.
Historically, therefore, the BSP had been subjected to government audit in so
far as public funds had been infused thereto. However, this practice should
not preclude the exercise of the audit jurisdiction of COA, clearly set forth
under the Constitution, which pertinently provides:
Section 2. (1) The Commission on Audit shall have the power, authority, and
duty to examine, audit, and settle all accounts pertaining to the revenue and
receipts of, and expenditures or uses of funds and property, owned or held in
trust by, or pertaining to, the Government, or any of its subdivisions,
agencies, or instrumentalities, including government-owned and controlled
corporations with original charters, and on a post-audit basis: (a)
constitutional bodies, commissions and offices that have been granted fiscal
autonomy under this Constitution; (b) autonomous state colleges and
universities; (c) other government-owned or controlled corporations with
original charters and their subsidiaries; and (d) such non-governmental
entities receiving subsidy or equity, directly or indirectly, from or through the
Government, which are required by law of the granting institution to submit to
64
such audit as a condition of subsidy or equity. x x x.
Since the BSP, under its amended charter, continues to be a public
corporation or a government instrumentality, we come to the inevitable
conclusion that it is subject to the exercise by the COA of its audit jurisdiction
in the manner consistent with the provisions of the BSP Charter.

WHEREFORE, premises considered, the instant petition for prohibition is

DISMISSED.

HON. AMATONG: Mr. Chairman, in connection with that.

SO ORDERED.
THE CHAIRMAN: Yeah, Gentleman from Zamboanga.

G.R. No. 169752

September 25, 2007

PHILIPPINE SOCIETY FOR THE PREVENTION OF CRUELTY TO

ANIMALS, Petitioners,
vs.
COMMISSION ON AUDIT, DIR. RODULFO J. ARIESGA (in his official
capacity as Director of the Commission on Audit), MS. MERLE M.
VALENTIN and MS. SUSAN GUARDIAN (in their official capacities as
Team Leader and Team Member, respectively, of the audit Team of the
Commission on Audit), Respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
Before the Court is a special civil action for Certiorari and Prohibition under
Rule 65 of the Rules of Court, in relation to Section 2 of Rule 64, filed by the
1
petitioner assailing Office Order No. 2005-021 dated September 14, 2005
issued by the respondents which constituted the audit team, as well as its
2
September 23, 2005 Letter informing the petitioner that respondents audit
team shall conduct an audit survey on the petitioner for a detailed audit of its
accounts, operations, and financial transactions. No temporary restraining
order was issued.
The petitioner was incorporated as a juridical entity over one hundred years
ago by virtue of Act No. 1285, enacted on January 19, 1905, by the
Philippine Commission. The petitioner, at the time it was created, was
composed of animal aficionados and animal propagandists. The objects of
the petitioner, as stated in Section 2 of its charter, shall be to enforce laws
relating to cruelty inflicted upon animals or the protection of animals in the
Philippine Islands, and generally, to do and perform all things which may
tend in any way to alleviate the suffering of animals and promote their
3
welfare.
At the time of the enactment of Act No. 1285, the original Corporation Law,
Act No. 1459, was not yet in existence. Act No. 1285 antedated both the
Corporation Law and the constitution of the Securities and Exchange
Commission. Important to note is that the nature of the petitioner as a
corporate entity is distinguished from the sociedad anonimas under the
Spanish Code of Commerce.
For the purpose of enhancing its powers in promoting animal welfare and
enforcing laws for the protection of animals, the petitioner was initially
imbued under its charter with the power to apprehend violators of animal
welfare laws. In addition, the petitioner was to share one-half (1/2) of the
fines imposed and collected through its efforts for violations of the laws

related thereto. As originally worded, Sections 4 and 5 of Act No. 1285

provide:
SEC. 4. The said society is authorized to appoint not to exceed five agents in
the City of Manila, and not to exceed two in each of the provinces of the
Philippine Islands who shall have all the power and authority of a police
officer to make arrests for violation of the laws enacted for the prevention of
cruelty to animals and the protection of animals, and to serve any process in
connection with the execution of such laws; and in addition thereto, all the
police force of the Philippine Islands, wherever organized, shall, as occasion
requires, assist said society, its members or agents, in the enforcement of all
such laws.
SEC. 5. One-half of all the fines imposed and collected through the efforts of
said society, its members or its agents, for violations of the laws enacted for
the prevention of cruelty to animals and for their protection, shall belong to
said society and shall be used to promote its objects.
(emphasis supplied)
Subsequently, however, the power to make arrests as well as the privilege to
retain a portion of the fines collected for violation of animal-related laws were
4
recalled by virtue of Commonwealth Act (C.A.) No. 148, which reads, in its
entirety, thus:
Be it enacted by the National Assembly of the Philippines:
Section 1. Section four of Act Numbered Twelve hundred and eighty-five as
amended by Act Numbered Thirty five hundred and forty-eight, is hereby
further amended so as to read as follows:
Sec. 4. The said society is authorized to appoint not to exceed ten agents in
the City of Manila, and not to exceed one in each municipality of the
Philippines who shall have the authority to denounce to regular peace
officers any violation of the laws enacted for the prevention of cruelty to
animals and the protection of animals and to cooperate with said peace
officers in the prosecution of transgressors of such laws.
Sec. 2. The full amount of the fines collected for violation of the laws against
cruelty to animals and for the protection of animals, shall accrue to the
general fund of the Municipality where the offense was committed.
Sec. 3. This Act shall take effect upon its approval.
Approved, November 8, 1936. (Emphasis supplied)

Immediately thereafter, then President Manuel L. Quezon issued Executive

Order (E.O.) No. 63 dated November 12, 1936, portions of which provide:
Whereas, during the first regular session of the National Assembly,
Commonwealth Act Numbered One Hundred Forty Eight was enacted
depriving the agents of the Society for the Prevention of Cruelty to Animals of
their power to arrest persons who have violated the laws prohibiting cruelty to
animals thereby correcting a serious defect in one of the laws existing in our
statute books.
xxxx
Whereas, the cruel treatment of animals is an offense against the State,
penalized under our statutes, which the Government is duty bound to
enforce;
Now, therefore, I, Manuel L. Quezon, President of the Philippines, pursuant
to the authority conferred upon me by the Constitution, hereby decree, order,
and direct the Commissioner of Public Safety, the Provost Marshal General
as head of the Constabulary Division of the Philippine Army, every Mayor of
a chartered city, and every municipal president to detail and organize special
members of the police force, local, national, and the Constabulary to watch,
capture, and prosecute offenders against the laws enacted to prevent cruelty
to animals. (Emphasis supplied)
On December 1, 2003, an audit team from respondent Commission on Audit
(COA) visited the office of the petitioner to conduct an audit survey pursuant
5
to COA Office Order No. 2003-051 dated November 18, 2003 addressed to
the petitioner. The petitioner demurred on the ground that it was a private
entity not under the jurisdiction of COA, citing Section 2(1) of Article IX of the
Constitution which specifies the general jurisdiction of the COA, viz:
Section 1. General Jurisdiction. The Commission on Audit shall have the
power, authority, and duty to examine, audit, and settle all accounts
pertaining to the revenue and receipts of, and expenditures or uses of funds
and property, owned or held in trust by, or pertaining to the Government, or
any of its subdivisions, agencies, or instrumentalities, including governmentowned and controlled corporations with original charters, and on a post-audit
basis: (a) constitutional bodies, commissions and officers that have been
granted fiscal autonomy under the Constitution; (b) autonomous state
colleges and universities; (c) other government-owned or controlled
corporations and their subsidiaries; and (d) such non-governmental entities
receiving subsidy or equity, directly or indirectly, from or through the
government, which are required by law or the granting institution to submit to
such audit as a condition of subsidy or equity. However, where the internal
control system of the audited agencies is inadequate, the Commission may

adopt such measures, including temporary or special pre-audit, as are

necessary and appropriate to correct the deficiencies. It shall keep the
general accounts of the Government, and for such period as may be
provided by law, preserve the vouchers and other supporting papers
pertaining thereto. (Emphasis supplied)
Petitioner explained thus:
a. Although the petitioner was created by special legislation, this necessarily
came about because in January 1905 there was as yet neither a Corporation
Law or any other general law under which it may be organized and
incorporated, nor a Securities and Exchange Commission which would have
passed upon its organization and incorporation.
b. That Executive Order No. 63, issued during the Commonwealth period,
effectively deprived the petitioner of its power to make arrests, and that the
petitioner lost its operational funding, underscore the fact that it exercises no
governmental function. In fine, the government itself, by its overt acts,
confirmed petitioners status as a private juridical entity.
6

The COA General Counsel issued a Memorandum dated May 6, 2004,

asserting that the petitioner was subject to its audit authority. In a letter dated
7
May 17, 2004, respondent COA informed the petitioner of the result of the
evaluation, furnishing it with a copy of said Memorandum dated May 6, 2004
of the General Counsel.
Petitioner thereafter filed with the respondent COA a Request for Re8
evaluation dated May 19, 2004, insisting that it was a private domestic
corporation.
Acting on the said request, the General Counsel of respondent COA, in a
9
Memorandum dated July 13, 2004, affirmed her earlier opinion that the
petitioner was a government entity that was subject to the audit jurisdiction of
respondent COA. In a letter dated September 14, 2004, the respondent COA
informed the petitioner of the result of the re-evaluation, maintaining its
position that the petitioner was subject to its audit jurisdiction, and requested
an initial conference with the respondents.
In a Memorandum dated September 16, 2004, Director Delfin Aguilar
reported to COA Assistant Commissioner Juanito Espino, Corporate
Government Sector, that the audit survey was not conducted due to the
refusal of the petitioner because the latter maintained that it was a private
corporation.
Petitioner received on September 27, 2005 the subject COA Office Order
2005-021 dated September 14, 2005 and the COA Letter dated September

23, 2005.
Hence, herein Petition on the following grounds:
A.
RESPONDENT COMMISSION ON AUDIT COMMITTED GRAVE ABUSE
OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION
WHEN IT RULED THAT PETITIONER IS SUBJECT TO ITS AUDIT
AUTHORITY.
B.
PETITIONER IS ENTITLED TO THE RELIEF SOUGHT, THERE BEING NO
APPEAL, NOR ANY PLAIN, SPEEDY AND ADEQUATE REMEDY IN THE
10
ORDINARY COURSE OF LAW AVAILABLE TO IT.
The essential question before this Court is whether the petitioner qualifies as
a government agency that may be subject to audit by respondent COA.
Petitioner argues: first, even though it was created by special legislation in
1905 as there was no general law then existing under which it may be
organized or incorporated, it exercises no governmental functions because
these have been revoked by C.A. No. 148 and E.O. No. 63; second, nowhere
in its charter is it indicated that it is a public corporation, unlike, for instance,
C.A. No. 111 which created the Boy Scouts of the Philippines, defined its
powers and purposes, and specifically stated that it was "An Act to Create a
Public Corporation" in which, even as amended by Presidential Decree No.
460, the law still adverted to the Boy Scouts of the Philippines as a "public
corporation," all of which are not obtaining in the charter of the petitioner;
third, if it were a government body, there would have been no need for the
State to grant it tax exemptions under Republic Act No. 1178, and the fact
that it was so exempted strengthens its position that it is a private institution;
fourth, the employees of the petitioner are registered and covered by the
Social Security System at the latters initiative and not through the
Government Service Insurance System, which should have been the case
had the employees been considered government employees; fifth, the
petitioner does not receive any form of financial assistance from the
government, since C.A. No. 148, amending Section 5 of Act No. 1285, states
that the "full amount of the fines, collected for violation of the laws against
cruelty to animals and for the protection of animals, shall accrue to the
general fund of the Municipality where the offense was committed"; sixth,
C.A. No. 148 effectively deprived the petitioner of its powers to make arrests
and serve processes as these functions were placed in the hands of the
police force; seventh, no government appointee or representative sits on the
board of trustees of the petitioner; eighth, a reading of the provisions of its

charter (Act No. 1285) fails to show that any act or decision of the petitioner
is subject to the approval of or control by any government agency, except to
the extent that it is governed by the law on private corporations in general;
and finally, ninth, the Committee on Animal Welfare, under the Animal
Welfare Act of 1998, includes members from both the private and the public
sectors.
The respondents contend that since the petitioner is a "body politic" created
by virtue of a special legislation and endowed with a governmental purpose,
then, indubitably, the COA may audit the financial activities of the latter.
Respondents in effect divide their contentions into six strains: first, the test to
determine whether an entity is a government corporation lies in the manner
of its creation, and, since the petitioner was created by virtue of a special
charter, it is thus a government corporation subject to respondents auditing
power; second, the petitioner exercises "sovereign powers," that is, it is
tasked to enforce the laws for the protection and welfare of animals which
"ultimately redound to the public good and welfare," and, therefore, it is
deemed to be a government "instrumentality" as defined under the
Administrative Code of 1987, the purpose of which is connected with the
administration of government, as purportedly affirmed by American
11
jurisprudence; third, by virtue of Section 23, Title II, Book III of the same
Code, the Office of the President exercises supervision or control over the
petitioner; fourth, under the same Code, the requirement under its special
charter for the petitioner to render a report to the Civil Governor, whose
functions have been inherited by the Office of the President, clearly reflects
the nature of the petitioner as a government instrumentality; fifth, despite the
passage of the Corporation Code, the law creating the petitioner had not
been abolished, nor had it been re-incorporated under any general
corporation law; and finally, sixth, Republic Act No. 8485, otherwise known
as the "Animal Welfare Act of 1998," designates the petitioner as a member
of its Committee on Animal Welfare which is attached to the Department of
Agriculture.
In view of the phrase "One-half of all the fines imposed and collected through
the efforts of said society," the Court, in a Resolution dated January 30,
2007, required the Office of the Solicitor General (OSG) and the parties to
comment on: a) petitioner's authority to impose fines and the validity of the
provisions of Act No. 1285 and Commonwealth Act No. 148 considering that
there are no standard measures provided for in the aforecited laws as to the
manner of implementation, the specific violations of the law, the person/s
authorized to impose fine and in what amount; and, b) the effect of the 1935
and 1987 Constitutions on whether petitioner continues to exist or should
organize as a private corporation under the Corporation Code, B.P. Blg. 68
as amended.
Petitioner and the OSG filed their respective Comments. Respondents filed a

Manifestation stating that since they were being represented by the OSG
which filed its Comment, they opted to dispense with the filing of a separate
one and adopt for the purpose that of the OSG.
The petitioner avers that it does not have the authority to impose fines for
violation of animal welfare laws; it only enjoyed the privilege of sharing in the
fines imposed and collected from its efforts in the enforcement of animal
welfare laws; such privilege, however, was subsequently abolished by C.A.
No. 148; that it continues to exist as a private corporation since it was
created by the Philippine Commission before the effectivity of the
Corporation law, Act No. 1459; and the 1935 and 1987 Constitutions.
The OSG submits that Act No. 1285 and its amendatory laws did not give
12
petitioner the authority to impose fines for violation of laws relating to the
prevention of cruelty to animals and the protection of animals; that even prior
to the amendment of Act No. 1285, petitioner was only entitled to share in the
fines imposed; C.A. No. 148 abolished that privilege to share in the fines
collected; that petitioner is a public corporation and has continued to exist
since Act No. 1285; petitioner was not repealed by the 1935 and 1987
Constitutions which contain transitory provisions maintaining all laws issued
not inconsistent therewith until amended, modified or repealed.
The petition is impressed with merit.
The arguments of the parties, interlaced as they are, can be disposed of in
five points.
First, the Court agrees with the petitioner that the "charter test" cannot be
applied.
Essentially, the "charter test" as it stands today provides:
[T]he test to determine whether a corporation is government owned or
controlled, or private in nature is simple. Is it created by its own charter for
the exercise of a public function, or by incorporation under the general
corporation law? Those with special charters are government corporations
subject to its provisions, and its employees are under the jurisdiction of the
Civil Service Commission, and are compulsory members of the Government
13
Service Insurance System. xxx (Emphasis supplied)
The petitioner is correct in stating that the charter test is predicated, at best,
on the legal regime established by the 1935 Constitution, Section 7, Article
XIII, which states:
Sec. 7. The National Assembly shall not, except by general law, provide for
the formation, organization, or regulation of private corporations, unless such

corporations are owned or controlled by the Government or any subdivision

14
or instrumentality thereof.
The foregoing proscription has been carried over to the 1973 and the 1987
Constitutions. Section 16 of Article XII of the present Constitution provides:
Sec. 16. The Congress shall not, except by general law, provide for the
formation, organization, or regulation of private corporations. Governmentowned or controlled corporations may be created or established by special
charters in the interest of the common good and subject to the test of
economic viability.
Section 16 is essentially a re-enactment of Section 7 of Article XVI of the
1935 Constitution and Section 4 of Article XIV of the 1973 Constitution.
During the formulation of the 1935 Constitution, the Committee on
Franchises recommended the foregoing proscription to prevent the pressure
of special interests upon the lawmaking body in the creation of corporations
or in the regulation of the same. To permit the lawmaking body by special law
to provide for the organization, formation, or regulation of private
corporations would be in effect to offer to it the temptation in many cases to
favor certain groups, to the prejudice of others or to the prejudice of the
15
interests of the country.
And since the underpinnings of the charter test had been introduced by the
1935 Constitution and not earlier, it follows that the test cannot apply to the
petitioner, which was incorporated by virtue of Act No. 1285, enacted on
January 19, 1905. Settled is the rule that laws in general have no retroactive
16
effect, unless the contrary is provided. All statutes are to be construed as
having only a prospective operation, unless the purpose and intention of the
legislature to give them a retrospective effect is expressly declared or is
necessarily implied from the language used. In case of doubt, the doubt must
17
be resolved against the retrospective effect.
There are a few exceptions. Statutes can be given retroactive effect in the
following cases: (1) when the law itself so expressly provides; (2) in case of
remedial statutes; (3) in case of curative statutes; (4) in case of laws
18
interpreting others; and (5) in case of laws creating new rights. None of the
exceptions is present in the instant case.
The general principle of prospectivity of the law likewise applies to Act No.
1459, otherwise known as the Corporation Law, which had been enacted by
virtue of the plenary powers of the Philippine Commission on March 1, 1906,
a little over a year after January 19, 1905, the time the petitioner emerged as
a juridical entity. Even the Corporation Law respects the rights and powers of
juridical entities organized beforehand, viz:

SEC. 75. Any corporation or sociedad anonima formed, organized, and

existing under the laws of the Philippine Islands and lawfully transacting
business in the Philippine Islands on the date of the passage of this Act, shall
be subject to the provisions hereof so far as such provisions may be
applicable and shall be entitled at its option either to continue business as
such corporation or to reform and organize under and by virtue of the
provisions of this Act, transferring all corporate interests to the new
corporation which, if a stock corporation, is authorized to issue its shares of
stock at par to the stockholders or members of the old corporation according
to their interests. (Emphasis supplied).
As pointed out by the OSG, both the 1935 and 1987 Constitutions contain
transitory provisions maintaining all laws issued not inconsistent therewith
19
until amended, modified or repealed.
In a legal regime where the charter test doctrine cannot be applied, the mere
fact that a corporation has been created by virtue of a special law does not
necessarily qualify it as a public corporation.
What then is the nature of the petitioner as a corporate entity? What legal
regime governs its rights, powers, and duties?
As stated, at the time the petitioner was formed, the applicable law was the
Philippine Bill of 1902, and, emphatically, as also stated above, no
proscription similar to the charter test can be found therein.
The textual foundation of the charter test, which placed a limitation on the
power of the legislature, first appeared in the 1935 Constitution. However,
the petitioner was incorporated in 1905 by virtue of Act No. 1258, a law
antedating the Corporation Law (Act No. 1459) by a year, and the 1935
Constitution, by thirty years. There being neither a general law on the
formation and organization of private corporations nor a restriction on the
legislature to create private corporations by direct legislation, the Philippine
Commission at that moment in history was well within its powers in 1905 to
constitute the petitioner as a private juridical entity.1wphi1
Time and again the Court must caution even the most brilliant scholars of the
law and all constitutional historians on the danger of imposing legal concepts
20
of a later date on facts of an earlier date.
The amendments introduced by C.A. No. 148 made it clear that the petitioner
was a private corporation and not an agency of the government. This was
evident in Executive Order No. 63, issued by then President of the
Philippines Manuel L. Quezon, declaring that the revocation of the powers of
the petitioner to appoint agents with powers of arrest "corrected a serious
defect" in one of the laws existing in the statute books.

As a curative statute, and based on the doctrines so far discussed, C.A. No.
148 has to be given retroactive effect, thereby freeing all doubt as to which
class of corporations the petitioner belongs, that is, it is a quasi-public
corporation, a kind of private domestic corporation, which the Court will
further elaborate on under the fourth point.
Second, a reading of petitioners charter shows that it is not subject to control
or supervision by any agency of the State, unlike government-owned and controlled corporations. No government representative sits on the board of
trustees of the petitioner. Like all private corporations, the successors of its
members are determined voluntarily and solely by the petitioner in
accordance with its by-laws, and may exercise those powers generally
accorded to private corporations, such as the powers to hold property, to sue
and be sued, to use a common seal, and so forth. It may adopt by-laws for its
internal operations: the petitioner shall be managed or operated by its
officers "in accordance with its by-laws in force." The pertinent provisions of
the charter provide:
Section 1. Anna L. Ide, Kate S. Wright, John L. Chamberlain, William F.
Tucker, Mary S. Fergusson, Amasa S. Crossfield, Spencer Cosby, Sealy B.
Rossiter, Richard P. Strong, Jose Robles Lahesa, Josefina R. de Luzuriaga,
and such other persons as may be associated with them in conformity with
this act, and their successors, are hereby constituted and created a body
politic and corporate at law, under the name and style of "The Philippines
Society for the Prevention of Cruelty to Animals."
As incorporated by this Act, said society shall have the power to add to its
organization such and as many members as it desires, to provide for and
choose such officers as it may deem advisable, and in such manner as it
may wish, and to remove members as it shall provide.
It shall have the right to sue and be sued, to use a common seal, to receive
legacies and donations, to conduct social enterprises for the purpose of
obtaining funds, to levy dues upon its members and provide for their
collection to hold real and personal estate such as may be necessary for the
accomplishment of the purposes of the society, and to adopt such by-laws for
its government as may not be inconsistent with law or this charter.
xxxx
Sec. 3. The said society shall be operated under the direction of its officers,
in accordance with its by-laws in force, and this charter.
xxxx
Sec. 6. The principal office of the society shall be kept in the city of Manila,

and the society shall have full power to locate and establish branch offices of
the society wherever it may deem advisable in the Philippine Islands, such
branch offices to be under the supervision and control of the principal office.

wards are charged with heavy social responsibilities. More so with all
common carriers. On the other hand, there may exist a public corporation
even if it is endowed with gifts or donations from private individuals.

Third. The employees of the petitioner are registered and covered by the
Social Security System at the latters initiative, and not through the
Government Service Insurance System, which should be the case if the
employees are considered government employees. This is another indication
of petitioners nature as a private entity. Section 1 of Republic Act No. 1161,
as amended by Republic Act No. 8282, otherwise known as the Social
Security Act of 1997, defines the employer:

The true criterion, therefore, to determine whether a corporation is public or

private is found in the totality of the relation of the corporation to the State. If
the corporation is created by the State as the latters own agency or
instrumentality to help it in carrying out its governmental functions, then that
corporation is considered public; otherwise, it is private. Applying the above
test, provinces, chartered cities, and barangays can best exemplify public
corporations. They are created by the State as its own device and agency for
25
the accomplishment of parts of its own public works.

Employer Any person, natural or juridical, domestic or foreign, who carries

on in the Philippines any trade, business, industry, undertaking or activity of
any kind and uses the services of another person who is under his orders as
regards the employment, except the Government and any of its political
subdivisions, branches or instrumentalities, including corporations owned or
controlled by the Government: Provided, That a self-employed person shall
be both employee and employer at the same time. (Emphasis supplied)
Fourth. The respondents contend that the petitioner is a "body politic"
because its primary purpose is to secure the protection and welfare of
animals which, in turn, redounds to the public good.
This argument, is, at best, specious. The fact that a certain juridical entity is
impressed with public interest does not, by that circumstance alone, make
the entity a public corporation, inasmuch as a corporation may be private
although its charter contains provisions of a public character, incorporated
solely for the public good. This class of corporations may be considered
quasi-public corporations, which are private corporations that render public
21
service, supply public wants, or pursue other eleemosynary objectives.
While purposely organized for the gain or benefit of its members, they are
required by law to discharge functions for the public benefit. Examples of
22
these corporations are utility, railroad, warehouse, telegraph, telephone,
23
water supply corporations and transportation companies. It must be
stressed that a quasi-public corporation is a species of private
corporations, but the qualifying factor is the type of service the former
renders to the public: if it performs a public service, then it becomes a quasi24
public corporation. 1wphi1
Authorities are of the view that the purpose alone of the corporation cannot
be taken as a safe guide, for the fact is that almost all corporations are
nowadays created to promote the interest, good, or convenience of the
public. A bank, for example, is a private corporation; yet, it is created for a
public benefit. Private schools and universities are likewise private
corporations; and yet, they are rendering public service. Private hospitals and

It is clear that the amendments introduced by C.A. No. 148 revoked the
powers of the petitioner to arrest offenders of animal welfare laws and the
power to serve processes in connection therewith.
Fifth. The respondents argue that since the charter of the petitioner requires
the latter to render periodic reports to the Civil Governor, whose functions
have been inherited by the President, the petitioner is, therefore, a
government instrumentality.
This contention is inconclusive. By virtue of the fiction that all corporations
owe their very existence and powers to the State, the reportorial requirement
is applicable to all corporations of whatever nature, whether they are public,
quasi-public, or private corporationsas creatures of the State, there is a
reserved right in the legislature to investigate the activities of a corporation to
determine whether it acted within its powers. In other words, the reportorial
requirement is the principal means by which the State may see to it that its
creature acted according to the powers and functions conferred upon it.
These principles were extensively discussed in Bataan Shipyard &
26
Engineering Co., Inc. v. Presidential Commission on Good Government.
Here, the Court, in holding that the subject corporation could not invoke the
right against self-incrimination whenever the State demanded the production
of its corporate books and papers, extensively discussed the purpose of
reportorial requirements, viz:
x x x The corporation is a creature of the state. It is presumed to be
incorporated for the benefit of the public. It received certain special privileges
and franchises, and holds them subject to the laws of the state and the
limitations of its charter. Its powers are limited by law. It can make no
contract not authorized by its charter. Its rights to act as a corporation are
only preserved to it so long as it obeys the laws of its creation. There is a
reserve[d] right in the legislature to investigate its contracts and find out
whether it has exceeded its powers. It would be a strange anomaly to hold
that a state, having chartered a corporation to make use of certain

franchises, could not, in the exercise of sovereignty, inquire how these

franchises had been employed, and whether they had been abused, and
demand the production of the corporate books and papers for that purpose.
The defense amounts to this, that an officer of the corporation which is
charged with a criminal violation of the statute may plead the criminality of
such corporation as a refusal to produce its books. To state this proposition
is to answer it. While an individual may lawfully refuse to answer
incriminating questions unless protected by an immunity statute, it does not
follow that a corporation vested with special privileges and franchises may
refuse to show its hand when charged with an abuse of such privileges.
27
(Wilson v. United States, 55 Law Ed., 771, 780.)

WHEREFORE, the petition is GRANTED. Petitioner is DECLARED a private

domestic corporation subject to the jurisdiction of the Securities and
Exchange Commission. The respondents are ENJOINED from investigating,
examining and auditing the petitioner's fiscal and financial affairs.
SO ORDERED.