Republic of the Philippines

SUPREME COURT

Manila

EN BANC

G.R. No. 108886 May 5, 1995

AQUILES U. REYES, petitioner,

vs.

REGIONAL TRIAL COURT OF ORIENTAL MINDORO, BRANCH XXXIX,

COMMISSION ON ELECTIONS, ADOLFO G. COMIA, AND THE
SANGGUNIANG BAYAN OF NAUJAN, ORIENTAL MINDORO,
respondents.

MENDOZA, J.:

This is a petition for certiorari, prohibition and mandamus which seeks (1) the
annulment of the decision, dated June 23, 1992, of the Regional Trial Court
(Br. 39) of Calapan, Oriental Mindoro, annuling the proclamation of petitioner
as the eighth member of the Sangguniang Bayan of Naujan, Oriental Mindoro;
(2) the annulment of the decision of the Commission on Elections (COMELEC),
dated January 22, 1993, dismissing petitioner's appeal from the trial court's
decision; (3) the issuance of a writ of mandamus to compel respondent
Sangguniang Bayan to recognize petitioner as the duly elected member
thereof; and (4) the issuance of a writ of prohibition against respondent
Adolfo G. Comia, enjoining him from continuing in office as member of the
Sangguniang Bayan of Naujan, Oriental Mindoro.

The facts are as follows:

Petitioner Aquiles Reyes and private respondent Adolfo Comia were

candidates for the position of member of the Sangguniang Bayan of Naujan,
Oriental Mindoro in the May 11, 1992 synchronized elections.

On May 13, 1992, during the proceedings of the Municipal Board of

Canvassers, private respondent moved for the exclusion of certain election
returns, on the ground of serious irregularity in counting in favor of petitioner
Aquiles Reyes votes cast for "Reyes" only, considering that there was another
candidate (Epitacio Reyes) bearing the same surname. However, without
resolving his petition, the Municipal Board of Canvassers proclaimed on the
same day petitioner as the eighth winning candidate with 7,205 votes. On
May 25, 1992 petitioner took his oath of office.

On June 1, 1992, private respondent filed an election protest before the trial
court. He alleged that "a vital mistake [had been] committed by the Board of
Canvassers in the mathematical computation of the total number of votes
garnered by petitioner [now private respondent];" Private respondent alleged:

5. That in the said Statement of Votes by City/Municipality or Precinct or

C.E. Form No. 20-A, it is reflected therein that the total number of votes
garnered by the petitioner is only 858 votes, when in fact and in truth, after
reviewing and correcting the computation of the actual votes garnered by the
petitioner the total votes to be counted in his favor is 915 votes;

6. That the Municipal Board of Canvassers and the Election Registrar of

Naujan, Oriental Mindoro, after having been informed of the said
discrepancies, manifested in the presence of Municipal Trial Court Judge
TOMAS C. LEYNES, that it was an honest mistake committed in the
computation and the addition of the total number of votes appearing in C.E.
Form No. 20-A.;
7. That after correcting the total number of votes garnered by the
petitioner, it appears now that the total votes cast in his favor in all precincts
is 7,233 votes which is more than 28 votes over the total of 7,205 votes
garnered by respondent Aquiles U. Reyes, who was proclaimed as Elected
Sangguniang Bayan Member of Naujan, Oriental Mindoro occupying the 8th
position.

On June 4, 1992, petitioner filed a motion to dismiss private respondent's

petition on the ground that it was filed beyond the reglementary period of ten
days from proclamation. On June 15, 1992, however, the trial court denied his
motion.

On the other hand, the Municipal Board of Canvassers file its answer in which
it admitted that it had made a mistake in crediting private respondent with
only 858 votes when he was entitled to 915 votes in the Statement of Votes
(C.E. Form No. 20-A).

On June 23, 1992, the trial court rendered its decision annuling the
proclamation of petitioner and declaring private respondent as the eighth
winning candidate for the position of councilor of the Sangguniang Bayan of
Naujan, Oriental Mindoro. A copy of the decision was served on petitioner on
June 26, 1992.

Petitioner filed a notice of appeal to the COMELEC. In addition, he filed a

petition for mandamus and prohibition in the Court of Appeals, to compel the
Sangguniang Bayan to recognize him as the duly proclaimed member of that
body and prohibit it from further recognizing private respondent.

On August 26, 1992, the Court of Appeals dismissed the petition because of
petitioner's pending appeal in the COMELEC. The appellate court cited
Supreme Court Circular 28-91 which prohibits the filing of multiple petitions
involving the same issues.

Petitioner filed a motion for reconsideration but his motion was denied. The
appellate court's decision became final and executory on December 10, 1992.
Meanwhile, the Sangguniang Bayan met in inaugural session on July 3, 1992,
during which private respondent was recognized as the eighth member of the
body and thereafter allowed to assume office and discharge its functions. On
July 13, 1992, it informed petitioner that it had recognized the private
respondent as its member.

On the other hand, the COMELEC's First Division dismissed on January 22,
1993 petitioner's appeal on the ground that he had failed to pay the appeal
fee within the prescribed period.

Petitioner then brought the present action. Petitioner contends that both the
trial court and the COMELEC's First Division committed a grave abuse of
discretion, the first, by assuming jurisdiction over the election contest filed by
private respondent despite the fact that the case was filed more than ten
days after petitioner's proclamation, and the second i.e., the COMELEC's First
Division, by dismissing petitioner's appeal from the decision of the trial court
for late payment of the appeal fee.

We find the petition to be without merit.

First. The Solicitor General, in behalf of the COMELEC, raises a fundamental

question. He contends that the filing of the present petition, without
petitioner first filing a motion for reconsideration before the COMELEC en
banc, violates Art. IX, A, 7 of the Constitution 1 because under this provision
only decisions of the COMELEC en banc may be brought to the Supreme
Court on certiorari.

This is correct. It is now settled that in providing that the decisions, orders
and rulings of COMELEC "may be brought to the Supreme Court on certiorari"
the Constitution in its Art. IX, A, 7 means the special civil action of certiorari
under Rule 65, 1. 2 Since a basic condition for bringing such action is that
the petitioner first file a motion for reconsideration, 3 it follows that
petitioner's failure to file a motion for reconsideration of the decision of the
First Division of the COMELEC is fatal to his present action.
Petitioner argues that this requirement may be dispensed with because the
only question raised in his petition is a question of law. This is not correct. The
questions raised by petitioner involve the interpretation of constitutional and
statutory provisions in light of the facts of this case. The questions tendered
are, therefore, not pure questions of law.

Moreover, that a motion for reconsideration before the COMELEC en banc is

required for the filing of a petition for certiorari is clear from the following
provisions of the Constitution:

Art. IX, C, 2. The Commission on Elections shall exercise the following

powers and functions:

xxx xxx xxx

(2) Exercise exclusive original jurisdiction over all contests relating to the
elections, returns, and qualifications of all elective regional, provincial, and
city officials, and appellate jurisdiction over all contests involving elective
municipal officials decided by trial courts of general jurisdiction, or involving
elective barangay officials decided by trial courts of limited jurisdiction.

Decisions, final orders, or rulings of the Commission on election contests

involving elective municipal and barangay offices shall be final, executory,
and not appealable.

Id. 3. The Commission on Elections may sit en banc or in two divisions, and
shall promulgate its rules of procedure in order to expedite disposition of
election cases, including pre-proclamation controversies. All such election
cases shall be heard and decided in division, provided that motions for
reconsideration of decisions shall be decided by the Commission en banc.

Conformably to these provisions of the Constitution all election cases,

including pre-proclamation controversies, must be decided by the COMELEC
in division. Should a party be dissatisfied with the decision, he may file a
motion for reconsideration before the COMELEC en banc. It is, therefore, the
decision, order or ruling of the COMELEC en banc that, in accordance with Art.
IX, A, 7, "may be brought to the Supreme Court on certiorari." 4

Second Even on the merits we think the First Division of the COMELEC
properly dismissed petitioner's appeal from the decision of the trial court
because of his failure to pay the appeal fee within the time for perfecting an
appeal. Rule 22, 9 of the COMELEC Rules of Procedure expressly provides:

Sec. 9. Grounds for dismissal of appeal. The appeal may be dismissed

upon motion of either party or at the instance of the Commission on any of
the following grounds:

(a) Failure of the appellant to pay the appeal fee; . . .

In accordance with 2(b) of COMELEC Resolution No. 2108-A, the appeal fee
must be paid within the period to perfect the appeal. Thus:

Sec. 2. When docket and other fees shall be paid.

xxx xxx xxx

(b) The appeal fees prescribed in section 3 of Rule 22 of the COMELEC

Rules of Procedures shall be paid within the period to perfect the appeal. . . .

The period to perfect the appeal is understood to be the period within which
to file the notice of appeal.

On the other hand, Rule 22, 3 of the Rules of Procedure of the COMELEC
provides:
Notice of Appeal. Within five (5) days after promulgation of the decision of
the court, the aggrieved party may file with said court a notice of appeal, and
serve a copy thereof upon the attorney of record of the adverse party.

This resolution, which was promulgated on July 14, 1989, superseded

COMELEC Resolution No. 1456 5 on which petitioner relies for his contention
that the fee is to be paid only upon the filing of the appeal brief.

The records show that petitioner received a copy of the decision of the trial
court on June 26, 1992. However, he paid the appeal fee of P1,020.00 only on
August 6, 1992. In other words, petitioner allowed forty (40) days to lapse
when the appeal fee should have been paid within five (5) days after
promulgation of the trial court's decision.

Petitioner claims that he acted on advice, presumably of COMELEC officials,

to wait until the records of the appealed case was received from the Regional
Trial Court, so that it could be docketed and given a case number before
paying the appeal fee. But there is nothing in the record to show this or that
petitioner offered to pay the appeal fee within the appeal period. He has not
identified the person who allegedly gave him the erroneous advice.

Petitioner also prays that a re-canvass be conducted in all the electoral

precincts of Naujan, Oriental Mindoro in view of the joint-affidavit executed by
the members of the Municipal Board of Canvassers on October 12, 1993 in
which they stated:

That the respondent Board, per verification from the Comelec records of
Naujan, after receipt of the sworn letter-complaint of Mr. Aquiles U. Reyes,
aside from the matters already alluded to above found that the "40" votes he
garnered in Precinct No. 37, and the "31" votes in Precinct 41-A that should
have been credited, transcribed or recorded in complainant's favor in the
Statement of Votes (C.E. Form No. 22-A) on the basis of the Election Returns
(C.E. Form No. 9), thru honest mistake was erroneously and inadvertently
transcribed or recorded in good faith and without malice due to mental and
physical fatigue and exhaustion by the Board of Canvassers and its staff in
favor of candidate Jeremias Nacorda of Sangguniang Bayan Member of the
Municipality of Naujan in the Statement of Votes (C.E. Form No. 22-A) of said
precincts, and what should have been credited and reflected as candidate
Nacorda's vote in the Statement of Votes (C.E. Form No. 22-A) on the basis of
the Election Returns (C.E. Form No. 9) are "9" votes in Precinct 37 not "40"
votes, and "8" votes in Precinct No. 41-A and not "31" votes, certification is
hereto attached issued by the Election Officer of Naujan that candidate
Nacorda per Comelec records shown in the Election Returns (C.E. Form No. 9)
only garnered "9" votes in Precinct 37, and "8" votes in Precinct 41-A and
marked as Annex "1" and made as integral part of his joint-affidavit.

This issue was raised in the Addendum to Appellant's Brief 6 in the COMELEC
Case EAC No. 9-92. With the dismissal of that case by the COMELEC's First
Division, there is no basis for petitioner's present contention.

Third. Petitioner also assails the decision of the trial court as having been
rendered without jurisdiction. He contends that the election protest of private
respondent was filed more than ten days after his (petitioner's) proclamation.

Petitioner is, however, estopped to raise this question now. He did not only
appeal from the decision of the trial court to the COMELEC raising this
question, but he also filed a petition for mandamus and prohibition in the
Court of Appeals. Having decided on this course of action, he should not be
allowed to file the present petition just because he lost in those cases.

WHEREFORE, the petition is DISMISSED for lack of merit.

SO ORDERED.

Republic of the Philippines

SUPREME COURT

Manila

EN BANC
G.R. No. 93355 April 7, 1992

LUIS B. DOMINGO, petitioner,

vs.

DEVELOPMENT BANK OF THE PHILIPPINES and CIVIL SERVICE

COMMISSION, respondents.

REGALADO, J.:

This special civil action impugns the resolution 1 of respondent Civil Service
Commission (CSC) promulgated on April 10, 1990 in CSC Case No. 473 setting
aside its earlier resolution of November 27, 1989 and affirming the separation
of petitioner Luis B. Domingo as Senior Training and Career Development
Officer of the Development Bank of the Philippines (DBP).

Petitioner was employed by DBP as Senior Training and Career Development

Officer on permanent status from February, 1979 to December 1986.

On December 3, 1986, Executive Order No 81 (The Revised Charter of DBP)

was passed authorizing the reorganization of DBP in this wise:

Sec. 32. Authority to Reorganize. In view of the new scope of

operations of the Bank, a reorganization of the Bank and a reduction in force
are hereby authorized to achieve simplicity and economy in operations,
including adopting a new staffing pattern to suit the reduced operations
envisioned. The formulation of the program of reorganization shall be
completed within six months after the approval of this Charter, and the full
implementation of the reorganization program within thirty months
thereafter.
Further, Sections 33 and 34 thereof provide:

Sec. 33. Implementing Details; Organization and Staffing of the Bank.

xxx xxx xxx

In the implementation of the reorganization of the Bank, as authorized under

the preceding section, qualified personnel of the Bank may be appointed to
appropriate positions in the new staffing pattern thereof and those not so
appointed are deemed separated from the service. No preferential or priority
rights shall be given to or enjoyed by any officer or personnel of the Bank for
appointment to any position in the new staffing pattern nor shall any officer
or personnel be considered as having prior or vested rights with respect to
retention in the Bank or in any position as may have been created in its new
staffing pattern, even if he should be the incumbent of a similar position
therein.

xxx xxx xxx

Sec. 34. Separation Benefits. All those who shall retire from the service
or are separated therefrom on account of the reorganization of the Bank
under the provisions of this Charter shall be entitled to all gratuities and
benefits provided for under existing laws and/or supplementary retirement
plans adopted by and effective in the Bank: . . .

Pursuant thereto, DBP issued Board Resolution No. 304-87 allowing the
issuance of temporary appointments to all DBP personnel in order to fully
implement the reorganization. The resolution states in part:

It is understood that pursuant to Section 32 of the new DBP Charter full

implementation of the reorganization program shall be completed within a
period of thirty-six (36) months from the approval of this Charter. In this
connection, the plantilla approved and appointments issued are purely
interim and the Bank is reserving its right to put in place the permanent
structure of the Bank as well as the permanent appointments thereto until
the end of the 36-month period. 2

In effect, said resolution authorized the issuance of temporary appointments

to all DBP personnel to allow maximum flexibility in the implementation of
the reorganization. Such temporary appointments issued had a maximum
period of twelve (12) months during which period the performance of the
incumbents were assessed on the basis of the results of their evaluation.

With the passage of Executive Order No. 81 and Board Resolution No. 304 87,
DBP undertook the evaluation and comparative assessment of all its
personnel under the CSC approved New Performance Appraisal System, a
peer and control rating process which served as an assessment tool of DBP's
screening process.

Petitioner Domingo was issued a temporary appointment on January 2, 1987

for a period of one (1) year, which was renewed for another period up to
November 30, 1988. Thereafter, in a memorandum 3 dated November 23,
1988 issued by the Final Review Committee, petitioner got a performance
rating of "below average," by reason of which his appointment was "made to
lapse."

Consequently, petitioner, together with a certain Evangeline Javier, filed with

the CSC a joint verified complaint 4 against DBP for illegal dismissal. The
complainants therein alleged that their dismissal constituted a violation of
the Civil Service Law against the issuance of temporary appointments to
permanent employees, as well as of their right to security of tenure and due
process.

On November 27, 1989, CSC issued a resolution 5 in CSC Case No. 473
directing "the reappointment of Mr. Domingo and Ms. Javier as Senior Training
and Career Development Officer and Research Analyst or any such equivalent
rank under the staffing pattern of DBP." The order for reappointment was
premised on the findings of the CSC that "(t)he action of the DBP to issue
temporary appointments to all DBP personnel in order to allow for the
maximum flexibility in evaluating the performance of incumbents is not in
accord with civil service law rules," in that "(t)o issue a temporary
appointment to one who has been on permanent status before will deprive
the employee of benefits accorded permanent employees and will adversely
affect his security of tenure," aside from the fact that such an act is contrary
to Section 25 (a) of Presidential Decree No. 807.

DBP filed a motion for reconsideration 6 on December 27, 1989 alleging, inter
alia, that the issuance of temporary appointments to all the DBP employees
was purely an interim arrangement; that in spite of the temporary
appointment, they continued to enjoy the salary, allowances and other
benefits corresponding to permanent employees; that there can be no
impairment of herein petitioner's security of tenure since the new DBP
charter expressly provides that "qualified personnel of the bank may be
appointed to appropriate positions in the new staffing pattern and those not
so appointed are deemed separated from the service;" that petitioner was
evaluated and comparatively assessed under a rating system approved by
the respondent commission; and that petitioner cannot claim that he was
denied due process of law considering that, although several appeals were
received by the Final Review Committee from other employees similarly
situated, herein petitioner never appealed his rating or the extension of his
temporary appointment although he was advised to do so by his direct
supervisor.

On April 10, 1990, CSC rendered the questioned resolution setting aside its
previous decision and affirming the separation of herein petitioner. In so
ruling, CSC explained that:

While it is true that this Commission ruled that the issuance of temporary
appointment to all DBP personnel in order to allow "for maximum flexibility"
in evaluating the performance of incumbents is not in accord with civil
service laws and rules, however it cannot lose sight of the fact that appellants
are among those who indeed got a below average rating (unsatisfactory)
when their performance were reevaluated and comparatively reassessed by
the Final Review Committee of the Bank approved by the Vice Chairman.

xxx xxx xxx

In effect, the determinative factor for retention and the separation from the
service is the individual performance rating.

While the Commission supports the principle of merit and fitness and strongly
protects the security of tenure of civil service officials and employees which
are the essence of careerism in the civil service, it does not however,
sanction the reappointment of said officials and employees who have fallen
short of the performance necessary in order to maintain at all times efficiency
and effectiveness in the Office.

It bears stressing that the DBP submitted the records and documents in
support of its allegations that Mr. Domingo and Ms. Javier have indeed
got(ten) a below average rating (unsatisfactory) during the filing of the
instant motion for reconsideration. Had DBP promptly submitted the
records/documents supporting its allegations, this Commission at the outset
should have sustained the separation of the appellants from the service on
ground of poor performance (below average rating, unsatisfactory) after the
reassessment and re-evaluation by the Bank through the Final Review
Committee. The CSC could not have guessed that such was the basis of the
DBP's termination of Domingo and Javier until the papers were submitted to
it. . . .

It must be pointed out that appellants' separation from the service was the
lapse of their temporary appointment. The non-extension or non-issuance of
permanent appointments were principally based on their below average
rating (unsatisfactory) performance after they were reevaluated and
comparatively reassessed by the Final Review Committee of the Bank. After
all, the 1986 DBP Revised Charter (E.O. No. 81) gives the Bank a wide latitude
of discretion in the reappointment of its personnel, subject to existing civil
service laws, rules and regulations.

There is no doubt that the DBP conducted a reevaluation and comparative

reassessment of its employees for placement/retention (for permanent) and
for separation from the service and found out that appellants are wanting of
performance, having been rated as "Below Average." 7

Hence this petition, whereby petitioner raises the following issues:

1. Petitioner's tenure of office was violated by respondents;

2. Petitioner was not afforded a day in court and was denied procedural
due process in the unilateral evaluation by his peers of his efficiency ratings
for the years 1987 and 1988;

3. Average and below average efficiency ratings are not valid grounds for
termination of the service of petitioner;

4. Section 5 of the rules implementing Republic Act No. 6656 is repugnant

to the constitutional mandate that "no officer or employee of the Civil Service
be removed or suspended except for cause provided by law;" and

5. Section 16, Article XVIII, Transitory Provisions of the New Constitution

was also violated by respondents. 8

I. Petitioner puts in issue the validity of the reorganization implemented

by DBP in that the same violates his right to security of tenure. He contends
that government reorganization cannot be a valid ground to terminate the
services of government employees, pursuant to the ruling in the case of Dario
vs. Mison, et al. 9

This statement of petitioner is incomplete and inaccurate, if not outright

erroneous. Either petitioner misunderstood or he totally overlooked what was
stated in the aforecited decision which held that "reorganizations in this
jurisdiction have been regarded as valid provided they are pursued in good
faith." As we said in Dario:

Reorganizations in this jurisdiction have been regarded as valid provided they

are pursued in good faith. As a general rule, a reorganization is carried out in
"good faith" if it is for the purpose of economy or to make bureaucracy more
efficient. In that event, no dismissal (in case of dismissal) or separation
actually occurs because the position itself ceases to exist. And in that case,
security of tenure would not be a Chinese wall.

Clearly, from our pronouncements in Dario, reorganization is a recognized

valid ground for separation of civil service employees, subject only to the
condition that it be done in good faith. No less than the Constitution itself in
Section 16 of the Transitory Provisions, together with Sections 33 and 34 of
Executive Order No. 81 and Section 9 of Republic Act No. 6656, support this
conclusion with the declaration that all those not so appointed in the
implementation of said reorganization shall be deemed separated from the
service with the concomitant recognition of their entitlement to appropriate
separation benefits and/or retirement plans of the reorganized government
agency.

The facts of this case, particularly the evaluation process adopted by DBP,
bear out the existence of good faith in the course of reorganization.

As a tool in the assessment process, a bank-wide peer and control rating

process was implemented. Under this process, the peers and supervisors
rated the DBP employees. 10

To make the reorganization as open, representative and fair as possible, two

principal groups were formed: (1) the Group Placement Screening Committee
(GPSC) and (2) the Central Placement Screening Committee (CPSC), to review
all recommendations (for retention or separation) prior to submissions to the
Chairman an the Board of Directors. The members of the two screening
committees were the Department and Group Heads and representatives from
the Career Officials Association and the DBP Employees Union. The CPSC was
further represented by the DBP Civil Service Officer, who sat as consultant to
help resolve questions on Civil Service rules and regulations.

As an assessment tool to the Bank's screening process, a peer and control

rating process was implemented bank-wide, the results of which were used as
a gauge to determine the suitability of an employee to stay in the Bank.
Through this rating, the Bank determines the value of the individual
employee to the Bank with the help of his peers (peer rating) and his
supervisors (control
rating). 11

Also, as part of the evaluation process, a Final Review Committee, composed

of the group, department or unit head, the heads of the Human Resource
Center and of the Personnel Services, and representatives from the Career
Officials Association and the Employees Union, was created to screen further
and to recommend the change in status of the employee's appointment from
temporary to permanent beginning 1988. For the rank and file level, the
committee was chaired by the Vice-Chairman while the officer level was
presided over by the Chairman of the Bank. 12

The performance rating system used and adopted by DBP was duly approved
by the Civil Service Commission. Herein petitioner was evaluated and
comparatively assessed under this approved rating system. This is shown by
the memorandum to the Vice-Chairman from the DBP Final Review
Committee wherein petitioner, among other DBP employees, was evaluated
and rated on his performance, and was shown to have gotten a rating of
"below average." 13

In the comment 14 filed by DBP with the CSC, respondent bank explained the
procedure it adopted in the evaluation of herein petitioner, together with one
Evangeline Javier, to wit:

xxx xxx xxx

4. During the second phase of the screening process, the Bank used
several instruments for determining proficiency or skills on the job. More than
skills, however, the evaluation also covered trait factors to determine a
positive work attitude. The Bank placed a premium on work attitude because
it believes that technical and professional skills can easily be acquired by an
ordinary normal individual as long as he has the right attitude towards
learning.

5. These attitudes are part of the new corporate culture outlined in the
corporate philosophy instituted for the Bank and disseminated thru the
various corporate culture seminars, monthly tertulias, speeches of the
Chairman and numerous various internal communications and bulletins. One
of the most important values emphasized was TEAMWORK due to the very
lean personnel force that the Bank was left with and the competition it has to
contend with in the industry.

6. Mr. Domingo and Miss Javier were subjected to this rating process as all
other employees of the Bank were.

xxx xxx xxx

8. Mr. Domingo and Miss Javier were recommended for a renewal of

temporary status after assessment of their performance because of several
indications of lack of skill and their inability to work with others in the
department where they were stationed. In a compassionate stance, it was
considered in the Central Personnel Committee to transfer them to another
department or unit of the Bank where they may be more effective and
productive, but they expressed preference to stay in the training unit of the
Bank, the Human Resource Center.

9. Along with others whose performance for 1987 was found wanting, Mr.
Domingo and Miss Javier were recommended for reappointment as temporary
for another period from January to November 1988 to give the Bank sufficient
time to consider their cases. However, in an evaluation of performance for all
extendees in November 1988, Mr. Domingo and Miss Javier were again found
wanting having both acquired a rating of "Below Average."

In addition, it is not disputed that DBP now has less than 2,000 employees
from a former high level of around 4,000 employees in 1986. And, under
Section 27 of Presidential Decree No. 807, the Government is authorized to
lay off employees in case of a reduction due to reorganization, thus:

Sec. 27. Reduction in Force. Whenever it becomes necessary because

of lack of work or funds or due to a change in the scope or nature of an
agency's program, or as a result of reorganization, to reduce the staff of any
department or agency, those in the same group or class of positions in one or
more agencies within the particular department or agency wherein the
reduction is to be effected shall be reasonably compared in terms of relative
fitness, efficiency and length of service, and those found to be least qualified
for the remaining positions shall be laid off.

Lastly, petitioner failed to invoke the presence of any of the circumstances

enumerated under Section 2 of Republic Act No. 6656 which would show or
tend to show the existence of bad faith in the implementation of the
reorganization.

Quintessentially, the reorganization having been conducted in accordance

with the mandate of Dario, it can safely be concluded that indeed the
reorganization was attended by good faith, ergo, valid. The dismissal of
herein petitioner is a removal for cause which, therefore, does not violate his
security of tenure.

As a final note on this issue, we quote with approval the statement of Mme.
Justice Ameurfina A. Melencio-Herrera in her dissenting opinion in the above-
cited case:

To be sure, the reorganization could affect the tenure of members of the

career service as defined in Section 5, Article IV of Presidential Decree No.
807, and may even result in the separation from office of some meritorious
employees. But even then, the greater good of the greatest number and the
right of the citizenry to a good government, and as they themselves have
mandated through the vehicle of Proclamation No. 3, provide the justification
for the said injury to the individual. In terms of values, the interest of an
employee to security of tenure must yield to the interest of the entire
populace and to an efficient and honest government.

II. Petitioner also maintains that "average" and "below average"

efficiency ratings are not valid grounds for his termination from the service.

It has become a basic and primordial concern of the State to insure and
promote the constitutional mandate that appointments in the civil service
shall be made only according to merit and fitness pursuant to its adopted
policy of requiring public officers and employees to serve with the highest
degree of responsibility, integrity, loyalty and efficiency. 15 As a matter of
fact, the development and retention of a competent and efficient work force
in the public service is considered as a primary concern of the Government.
16 Hence, employees are selected on the basis of merit and fitness to
perform the duties and assume the responsibilities of the position to which
they are appointed. 17 Concomitantly, the government has committed itself
to engender a continuing program of career and personnel development for
all government employees, 18 by establishing a performance evaluation
system to be administered in such manner as to continually foster the
improvement of individual employee efficiency and organizational
effectiveness. 19

All these abundantly show that the State puts a premium on an individual's
efficiency, merit and fitness before one is accepted into the career service. A
civil service employee's efficiency rating, therefore, is a decisive factor for his
continued service with the Government. The inescapable conclusion is that a
"below average" efficiency rating is sufficient justification for the termination
of a government employee such as herein petitioner. This is the reason why,
painful as it may be, petitioner's separation must be affirmed if public good is
to be subserved. In the words of respondent commission in its questioned
resolution, it cannot "sanction the reappointment of said officials and
employees who have fallen short of the performance necessary in order to
maintain at all times efficiency and effectiveness in the Office." 20

III. Petitioner finally contends that where the purpose of the evaluation
proceeding is to ascertain whether he should be retained or separated from
the service, it is a proceeding to determine the existence of a ground for his
termination and, therefore, he should be afforded a day in court, pursuant to
the requirements of procedural due process, to defend himself against any
adverse findings in the process of evaluation of his performance.

Petitioner's contention cannot be sustained.

Section 2 of Republic Act No. 6656 provides that "no officer or employee in
the career service shall be removed except for a valid cause and after due
notice and hearing." Thus, there is no question that while dismissal due to a
bona fide reorganization is recognized as a valid cause, this does not justify a
detraction from the mandatory requirement of notice and hearing. However,
it is equally true and it is a basic rule of due process that "what the law
prohibits is not the absence of previous notice but the absolute absence
thereof and the lack of opportunity to be heard." 21 There is no violation of
procedural due process even where no hearing was conducted for as long as
the party was given a chance to present his evidence and defend himself.

The records show that petitioner had the opportunity to present his side
and/or to contest the results of the evaluation proceedings. In DBP's motion
for the reconsideration of the original decision of respondent commission,
respondent bank averred:

It may be stated that although several appeals were received by the Final
Review Committee from other employees similarly situated (i.e., also given
temporary appointments for 1988), Mr. Domingo and Miss Javier never
appealed their ratings or the extension of their temporary appointments in
1988. Even at this writing, the Bank has not received any formal appeal from
them although they were advised to do so by their direct supervisor. 22

The fact that petitioner made no appeal to the Final Review Committee was
duly considered by respondent commission in resolving said motion for
reconsideration and in affirming the separation of petitioner from the service,
noting that "appellants Mr. Domingo, and Miss Javier did not file or submit
their opposition to the motion for reconsideration." Consequently, petitioner
cannot, by his own inaction, legally claim that he was denied due process of
law.

Considering petitioner's years of service, despite the unfortunate result of the

reorganization insofar as he is concerned, he should be allowed separation
and other retirement benefits accruing to him by reason of his termination, as
provided for in Section 16, Article XVIII of the 1987 Constitution, as well as in
Section 9 of Republic Act No. 6656 and Section 34 of Executive Order No. 81.

WHEREFORE, no grave abuse of discretion having been committed by

respondent Civil Service Commission, its challenged resolution of April 10,
1990 is hereby AFFIRMED.
SO ORDERED.

EN BANC

[G.R. No. 135869. September 22, 1999]

RUSTICO H. ANTONIO, petitioner, vs. COMMISSION ON ELECTIONS

and VICENTE T. MIRANDA, JR., respondents.

DECISION

GONZAGA_REYES, J.:

Is the period to appeal a decision of a municipal trial court to the Commission

on Elections (COMELEC) in an election protest involving a barangay position
five (5) days per COMELEC Rules of Procedure or ten (10) days as provided for
in Republic Act 6679[1] and the Omnibus Election Code? This is the sole issue
posed in the instant petition for certiorari under Rule 65 of the 1997 Rules of
Civil Procedure seeking to annul the order dated August 3, 1998 of the
Second Division of the COMELEC,[2] dismissing the appeal of petitioner
Rustico Antonio for having been filed out of time pursuant to COMELEC Rules
of Procedure, and the order promulgated on October 14, 1998 of the
COMELEC en banc, denying petitioners motion for reconsideration.

The antecedents as found by the COMELEC in the order dated October 14,
1998 are:

The parties in this case were rival candidates for the Punong Barangay of
Barangay Ilaya, Las Pias City, Metro Manila. After the board of canvassers
proclaimed protestee-appellant Rustico Antonio, protestant-appellee Vicente
T. Miranda, Jr. filed an election protest docketed as Election Protest Case No.
97-0017 against Antonio before the Metropolitan Trial Court of Las Pias City
(Branch LXXIX). The trial court rendered a Decision dated 9 March 1998, the
dispositive portion of which states:

WHEREFORE, the Court declares the protestant Vicente Miranda as the duly
elected Barangay Chairman of Barangay Ilaya, Las Pias City, Metro Manila.
Antonio admitted receipt of the above-quoted decision on 18 March 1998.
Subsequently, Antonio filed a Notice of Appeal with the trial court on 27
March 1998 or nine (9) days after receipt thereof. Meanwhile, Miranda moved
to execute the trial courts decision. Rustico, in his Opposition to the Motion
for Execution or Execution Pending Appeal, argued against Mirandas motion
for execution. After the trial court denied the motion for execution, the
records of this case was forwarded to the Commission (Second Division).

On 10 August 1998, protestee-appellant Rustico Antonio received from this

Commission (Second Division) an Order dated 3 August 1998 stating as
follows:

In the light of the aforequoted rules, protestee RUSTICO ANTONIO, failed to

perfect his appeal within the five (5) days period prescribed for perfecting his
appeal, as he filed his Notice of Appeal only on March 27, 1998 or nine (9)
days after receipt of the decision sought to be appealed.

The Period aforestated is jurisdictional and failure of the protestee to perfect

his appeal within the said period deprives the Commission of its appellate
jurisdiction.

ACCORDINGLY, the instant appeal is hereby DISMISSED for lack of jurisdiction.

Hence, this motion for reconsideration.

The instant Motion for Reconsideration is DENIED and We AFFIRM the Order
dated 3 August 1998 of this Commission (Second Division).[3]

In the instant petition for certiorari, petitioner argues that the COMELEC
committed grave abuse of discretion amounting to lack of jurisdiction when it
dismissed the appeal for the following reasons:

(a) In barangay electoral protest cases, the period of appeal is ten (10) days
from receipt of the decision of the Metropolitan or Municipal Trial Court. This
is provided for by Sec. 9 of R.A. 6679 and Sec. 252 of the Omnibus Election
Code

(b) The provisions of Sec. 21, Rule 37 of the COMELEC Rules of Procedure
providing for a five-day period within which to appeal from the decision of the
Metropolitan or Municipal Trial Court could not prevail upon the express
provisions of Rep. Act No. 6679 and Sec. 252 of the Omnibus Election Code;

(c) Moreover, the COMELEC committed an error of jurisdiction when it

disregarded the provisions of Sections 5,6 & 7, Rule 22 of the COMELEC Rules
of Procedure requiring the filing of briefs by the appellant and the appellee.
The questioned resolution of August 3, 1998 was issued motu propio and
without prior notice and hearing. The petitioner was fast tracked;

(d) The alleged winning margin of the private respondent over the petitioner
as found by the Metropolitan Trial Court of Las Pias is only four (4) votes the
results being MIRANDA 1,171; ANTONIO 1,167. The peoples will must not go
on procedural points. An election protest involves public interest, and
technicalities should not be sanctioned when it will be an obstacle in the
determination of the true will of the electorate in the choice of its public
officials. [Macasundig vs. Macalanagan, 13 SCRA 577; Vda. De Mesa vs.
Mensias, 18 SCRA 533; Juliano vs. Court of Appeals, 20 SCRA 808; Genete vs.
Archangel, 21 SCRA 1178; Maliwanag vs. Herrera, 25 SCRA 175; De Castro vs.
Genete, 27 SCRA 623]

(e) The questioned resolutions violated the above principle because the
COMELEC did not appreciate the contested ballots.[4]

In dismissing the appeal, the COMELEC relied on Section 21, Rule 35 of the
COMELEC Rules of Procedure which reads:

SEC. 21. Appeal From any decision rendered by the court, the aggrieved party
may appeal to the Commission on Elections within five (5) days after the
promulgation of the decision.
On the other hand, petitioner contends that the period of appeal from
decisions of the Municipal Trial Courts or Metropolitan Trial Courts involving
barangay officials is governed by Section 9 of Republic Act 6679 and Section
252 of the Omnibus Election Code.

Section 9 of Republic Act 6679 reads:

SEC. 9. A sworn petition contesting the election of a barangay official may be

filed with the proper municipal or metropolitan trial court by any candidate
who has duly filed a certificate of candidacy and has been voted for a
barangay office within ten (10) days after the proclamation of the results of
the election. The trial court shall decide the election protest within thirty (30)
days after the filing thereof. The decision of the municipal or metropolitan
trial court may be appealed within ten (10) days from receipt of a copy
thereof by the aggrieved party to the regional trial court which shall decide
the issue within thirty (30) days from receipt of the appeal and whose
decision on questions of fact shall be final and non-appealable. For purposes
of the barangay elections, no pre-proclamation cases shall be allowed.

Similarly, Section 252 of the Omnibus Election Code provides:

SEC. 252. Election contest for barangay offices. A sworn petition contesting
the election of a barangay officer shall be filed with the proper municipal or
metropolitan trial court by any candidate who has duly filed a certificate of
candidacy and has been voted for the same office within ten days after the
proclamation of the results of the election. The trial court shall decide the
election protest within fifteen days after the filing thereof. The decision of the
municipal or metropolitan trial court may be appealed within ten days from
receipt of a copy thereof by the aggrieved party to the regional trial court
which shall decide the case within thirty days from its submission, and whose
decisions shall be final.

In applying Section 21 of the COMELEC Rules of Procedure rather than Section

9 of Republic Act 6779 and Section 252 of the Omnibus Election Code, the
COMELEC rationalized thus:
Antonio asserts that Section 9 of Republic Act 6679 and Section 252 of the
Omnibus Election Code providing for a ten-day period to appeal prevails over
the provisions of the COMELEC Rules of Procedure. According to Antonio,
quasi-judicial bodies, including this Commission, cannot amend an act of
Congress and in case of discrepancy between the basic law and an
interpretative or administrative ruling, the former prevails. Generally, yes.
But the situation herein does not fall within the generic situation
contemplated therein.

No less than the 1987 Constitution (Article IX-A, Section 6 and Article IX-C,
Section 3) grants and authorizes this Commission to promulgate its own rules
of procedure as long as such rules concerning pleadings and practice do not
diminish, increase or modify substantive rights. Hence, the COMELEC Rules of
Procedure promulgated in 1993 as amended in 1994 is no ordinary
interpretative or administrative ruling. It is promulgated by this Commission
pursuant to a constitutionally mandated authority which no legislative
enactment can amend, revise or repeal.

The COMELEC Rules of Procedure (Rule 37 Section 21) provides that from the
decision rendered by the court, the aggrieved party may appeal to the
Commission on Elections within five (5) days after the promulgation of the
decision. Rule 22 Section 9 (d) of Our Rules of Procedure further provides that
an appeal from decisions of courts in election protest cases may be dismissed
at the instance of the Commission for failure to file the required notice of
appeal within the prescribed period.

In case at bar, Antonio filed his notice of appeal before the trial court on the
ninth (9) day from receipt of the decision appealed from or four (4) days after
the five-day prescribed period to appeal lapsed. Therefore, the present
appeal must be dismissed. For it is axiomatic that the perfection of an appeal
in the manner and within the period laid down by the COMELEC Rules of
Procedure is not only mandatory but also jurisdictional. As a consequence,
the failure to perfect an appeal within the prescribed period as required by
the Rules has the effect of defeating the right of appeal of a party and
precluding the appellate court from acquiring jurisdiction over the case. So
the High Court rules in Villanueva vs. Court of Appeals, et.al. (205 SCRA 537).
And so, it should also be in the case at bar.
Worth noting is that Our Rules of Procedure may be amended, revised or
repealed pursuant to the 1987 Constitution (Article VIII Section 5[5])
providing that rules of procedure of quasi-judicial bodies shall remain
effective unless disapproved by the Supreme Court. But far from being
disapproved the COMELEC Rules of Procedure received approbation and has
constantly been cited by the Supreme Court in a number of decisions such as
in the case of Pahilan vs. Tabalba (230 SCRA 205, at 211) and Rodillas vs.
Commission on Elections (245 SCRA 702, at 704). In the more recent case of
Calucag vs. Commission on Elections promulgated on 19 June 1997 (G.R. N.o
123673), the Supreme Court stated that:

Therefore, the COMELEC is the proper appellate court clothed with jurisdiction
to hear the appeal WHICH APPEAL MUST BE FILED WITHIN FIVE DAYS AFTER
THE PROMULGATION OF THE MTC DECISION(page 4-5).

The repeated recognition given by the Supreme Court of this five-day rule
within which to file the required notice of appeal will make questionable the
legislative enactment providing for a ten-day period.[5]

Without adopting the foregoing ratiocination of the COMELEC, we nonetheless

find the instant petition devoid of merit.

It is beyond cavil that legislative enactments prevail over rules of procedure

promulgated by administrative or quasi-judicial bodies and that rules of
procedure should be consistent with standing legislative enactments. In
relation to the above-quoted Section 9 of Republic Act 6679 and Section 252
of the Omnibus Election Code, petitioner points out that in Flores vs.
Commission on Elections[6], this Court had declared that decisions of the
Metropolitan or Municipal Court in election protest cases involving barangay
officials are no longer appealable to the Regional Trial Court but to the
COMELEC pursuant to Section 2(2) of Article IX-C of the 1987 Constitution.[7]
Petitioner submits that the dispositive portion in the Flores case only declared
unconstitutional that portion of Section 9 of Republic Act 6679 providing for
appeal to the Regional Trial Court but not the ten (10) day period of appeal.
The dispositive portion of the Flores case reads:
1. Declaring Section 9 of Rep. Act No. 6679 UNCONSTITUTIONAL insofar as it
provides that barangay election contests decided by the municipal or
metropolitan trial court shall be appealable to the regional trial court:

Petitioner admits that the provisions in Republic Act No. 6679 and for that
matter the Omnibus Election Code providing for appellate jurisdiction to the
Regional Trial Court had been declared unconstitutional in the aforecited
Flores case. A verbatim comparison of both provisions reveals that they
provide the same remedy, that is, appeal from a decision of the municipal or
metropolitan trial court in barangay election cases to the regional trial court.
Both provisions provide that (1) results of a barangay election may be
contested by filing a sworn petition with the municipal trial court within ten
days from proclamation; (2) the MTC shall decide within thirty days per
Republic Act No. 6679 or fifteen days per Omnibus Election Code; and (3) the
decision of the municipal trial court may be appealed to the regional trial
court within ten days from receipt by the aggrieved party, which decision is
final and non-appealable. There is no appreciable basis to make a distinction
between the two provisions, except for their different numbers, to advance
that they provide for two different remedies. It would be superfluous to insist
on a categorical declaration of the unconstitutionality of the appeal provided
for in Sec. 252 of the Omnibus Election Code, as the same appeal in Sec. 9,
Republic Act No. 6679 had already been categorically declared
unconstitutional. Further, Sec. 252 of the Omnibus Election Code[8] as
amended by the new law, Republic Act No. 6679[9], has in effect, been
superseded by the latter. While the appellate procedure has been retained by
the amendatory act, Republic Act No. 6679 nonetheless supersedes the
verbatim provision in the Omnibus Election Code. Hence, it was not necessary
for Flores to mention Sec. 252 of the Omnibus Election Code, considering that
as aforestated, Section 9 of Republic Act No. 6679 was a mere reenactment
of the former law.

Petitioner is of the opinion, though, that the unconstitutionality extended only

as to which court has appellate jurisdiction without affecting the period within
which to appeal. According to petitioner, only the portion providing for the
appellate jurisdiction of the Regional Trial Court in said cases should be
deemed unconstitutional. The rest of the provisions, particularly on the period
to appeal, free from the taint of unconstitutionality, should remain in force
and effect in view of the separability clauses contained in Republic Act
6779[10] and the Omnibus Election Code.[11]
We do not agree.

First, petitioners argument raises the presumption that the period to appeal
can be severed from the remedy or the appeal itself which is provided in
Section 9, Republic Act 6679 and survive on its own. The presumption cannot
be sustained because the period to appeal is an essential characteristic and
wholly dependent on the remedy.

Aptly, the rules on statutory construction prescribe:

The general rule is that where part of a statute is void as repugnant to the
Constitution, while another part is valid, the valid portion, if separable from
the invalid, may stand and be enforced. The presence of a separability clause
in a statute creates the presumption that the legislature intended
separability, rather than complete nullity, of the statute. To justify this result,
the valid portion must be so far independent of the invalid portion that it is
fair to presume that the legislature would have enacted it by itself if it had
supposed that it could not constitutionally enact the other. Enough must
remain to make a complete, intelligible, and valid statute, which carries out
the legislative intent. The void provisions must be eliminated without causing
results affecting the main purpose of the act in a manner contrary to the
intention of the legislature. The language used in the invalid part of the
statute can have no legal effect or efficacy for any purpose whatsoever, and
what remains must express the legislative will independently of the void part,
since the court has no power to legislate.

The exception to the general rule is that when the parts of a statute are so
mutually dependent and connected, as conditions, considerations,
inducements, or compensations for each other, as to warrant a belief that the
legislature intended them as a whole the nullity of one part will vitiate the
rest. In making the parts of the statute dependent, conditional, or connected
with one another, the legislature intended the statute to be carried out as a
whole and would not have enacted it if one part is void, in which case if some
parts are unconstitutional, all the other provisions thus dependent,
conditional, or connected must fall with them.[12]

In the instant petition, the exception applies. Section 9 of Republic Act No.
6679 and Section 252 of the Omnibus Election Code, without the
constitutionally infirm portion on the appellate jurisdiction of Regional Trial
Courts in barangay election protest cases, does not remain complete in itself,
sensible, capable of being executed and wholly independent of the portion
which was rejected. In other words, with the elimination of the forum, the
period cannot stand on its own. Moreover, when this Court stated that
Section 9 of Rep. Act No. 6679 is declared unconstitutional insofar as it
provides that barangay election contests decided by the municipal or
metropolitan trial court shall be appealable to the regional trial court, it
meant to preserve the first two sentences on the original jurisdiction of
municipal and metropolitan trial courts to try barangay election protests
cases but not, as advanced by the petitioner, the ten-day period to appeal to
the Regional Trial Court. This is the logical and sound interpretation of subject
portion of the Flores case.

Second, what was invalidated by the Flores case was the whole appeal itself
and not just the question of which court to file the petition. If the remedy
itself is declared unconstitutional how could the period to appeal possibly
survive? How could the time limit exist if there is nothing to be done within
such time?

Third, we cannot indulge in the assumption that Congress still intended, by

the said laws, to maintain the ten (10) day period to appeal despite the
declaration of unconstitutionality of the appellate jurisdiction of the regional
trial court, Republic Act No. 7166[13] amending the Omnibus Election Code,
evinces the intent of our lawmakers to expedite the remedial aspect of
election controversies. The law was approved on November 26, 1991, after
the Flores case which was promulgated on April 20,1990, and presumably,
the legislature in enacting the same was cognizant of the ruling in Flores.
Said law provides the same five (5) day period to appeal decisions of the trial
court in election contests for municipal officers to the COMELEC. Section 22
thereof reads:

Sec. 22. Election Contests for Municipal Officers. All election contests
involving municipal offices filed with the Regional Trial Court shall be decided
expeditiously. The decision may be appealed to the Commission within five
(5) days from promulgation or receipt of a copy thereof by the aggrieved
party. The Commission shall decide the appeal within sixty (60) days after it is
submitted for decision, but not later than six (6) months after the filing of the
appeal, which decision shall be final, unappealable and executory.
There would be no logic nor reason in ruling that a longer period to appeal to
the COMELEC should apply to election contests for barangay officials.

Fourth, since the whole remedy was invalidated, a void was created. Thus,
the COMELEC had to come in and provide for a new appeal in accordance
with the mandate of the Constitution. As correctly pointed out by the
COMELEC, Section 6, Article IX-A[14] of the 1987 Constitution grants and
authorizes the COMELEC to promulgate its own rules of procedure. The 1993
COMELEC Rules of Procedure have provided a uniform five (5) day period for
taking an appeal[15] consistent with the expeditious resolution of election-
related cases. It would be absurd and therefore not clearly intended, to
maintain the 10-day period for barangay election contests. Hence, Section 3,
Rule 22 of the COMELEC Rules of Procedure is not in conflict with any existing
law. To adopt a contrary view would defeat the laudable objective of providing
a uniform period of appeal and defy the COMELECs constitutional mandate to
enact rules of procedure to expedite disposition of election cases.

In view of the Flores case, jurisprudence has consistently recognized that the
COMELEC Rules of Procedure are controlling in election protests heard by a
regional trial court.[16] The Court en banc has held in Rodillas vs.
COMELEC[17] that the procedure for perfecting an appeal from the decision
of the Municipal Trial Court in a barangay election protest case is set forth in
the COMELEC Rules of Procedure. More recently, in Calucag vs. Commission
on Elections[18], the Court en banc had occasion to state that:

It follows that after the promulgation of Flores, the same arguments

propounded therein by the petitioner may no longer be employed. Article 8 of
the Civil Code states that (j)udicial decisions applying or interpreting the laws
or the constitution shall form part of the legal system of the Philippines. Said
pronouncement of the Court, having formed part of the law of the land,
ignorance thereof can no longer be countenanced. Therefore, the COMELEC is
the proper appellate court clothed with jurisdiction to hear the appeal, which
appeal must be filed within five days after the promulgation of the MTCs
decision. The erroneous filing of the appeal with the RTC did not toll the
running of the prescriptive period. xxx. The five-day period having expired
without the aggrieved party filing the appropriate appeal before the
COMELEC, the statutory privilege of petitioner to appeal is deemed waived
and the appealed decisions has become final and executory.
Significantly, Section 5(5), Article VIII of the Constitution provides in part that
[r]ules of procedure of special courts and quasi-judicial bodies shall remain
effective unless disapproved by the Supreme Court.

Equally devoid of merit is the contention that petitioner was fast tracked
because the COMELEC did not require the parties to file their appeal briefs;
that the dismissal was issued motu proprio without prior notice and hearing;
and that dismissal of the appeal defeats the peoples will on procedural
points. Suffice it to state that the period for filing an appeal is by no means a
mere technicality of law or procedure. It is an essential requirement without
which the decision appealed from would become final and executory as if no
appeal was filed at all. The right of appeal is merely a statutory privilege and
may be exercised only in the manner prescribed by, and in accordance with,
the provisions of the law.[19] Further, by virtue of Section 9 (d), Rule 22 of the
COMELEC Rules of Procedure which provides that an appeal may be
dismissed upon motion of either party or at the instance of the Commission
for failure to file a notice of appeal within the prescribed period, the COMELEC
is precisely given the discretion, in a case where the appeal is not filed on
time to dismiss the action or proceeding.

The COMELEC, therefore, did not commit an abuse of discretion in dismissing

the appeal.

WHEREFORE, the instant petition for certiorari is hereby DISMISSED for lack of
merit. The assailed orders of the Commission on Elections dated August 3,
1998 and October 14, 1998 are hereby AFFIRMED.

SO ORDERED.

Republic of the Philippines

SUPREME COURT

Manila

EN BANC
G.R. No. L-55513 June 19, 1982

VIRGILIO SANCHEZ, petitioner,

vs.

COMMISSION ON ELECTIONS, respondent.

G.R. No. L-5564 June 19, 1982

ARMANDO BILIWANG petitioner,

vs.

COMMISSION ON ELECTIONS, respondent.

MELENCIO-HERRERA, J.:

The Resolution of the Commission on Elections, dated May 15, 1980, in Pre-
Proclamation Case No. 41, entitled Virgilio Sanchez vs. Mayor Armando P.
Biliwang and the Municipal Board of Canvassers of San Fernando, Pampanga,
is challenged in these consolidated Petitions for Certiorari.

In the local elections held on January 30, 1980, Virgilio Sanchez was the
official candidate of the Nacionalista Party (NP) for Municipal Mayor of San
Fernando, Pampanga, while Armando Biliwang was the Kilusang Bagong
Lipunan's (KBL) official candidate for the same position. The latter was
proclaimed winner by the Municipal Board of Canvassers of said town.

On February 1, 1980, Sanchez filed with the Commission on elections a

Petition to declare null and void the local elections in San Fernando due to
alleged large scale terrorism. On the same day, the COMELEC denied the
Petition for lack of merit. Sanchez moved for reconsideration. On February 8,
1980, the COMELEC recalled its Resolution and required Biliwang and the
Municipal Board of Canvassers to answer. Hearings were conducted
thereafter.

On May 15, 1980, the COMELEC issued the challenged resolution, the
dispositive portion of which reads:

WHEREFORE, the Commission hereby orders the following:

1. The annulment of the election held on January 30, 1980 of the local
government officials in San Fernando, Pampanga, consequently, the
annulment and setting aside of the proclamation of respondent Armando P.
Biliwang and other municipal officials thereat; and

2. To certify to the President/Prime Minister and the Batasang Pambansa

the failure of election in San Fernando, Pampanga, so that remedial
legislation may be enacted and that pending such enactment, the
President/Prime Minister may appoint the municipal officials of San Fernando,
Pampanga.

The aforesaid Resolution was prompted by the COMELEC's findings as follows:

However, after the voting was over the terrorism and irregularities were
committed as aforementioned. There is strong and sufficient evidence to
support the charge that in the preparation of election returns, the teacher
members of the Citizens Election Committees (CEC's) were threatened and
coerced into making spurious election returns without regard to the genuine
ballots in the ballot boxes. Policemen, armed goons and other persons all
in obvious conspiracy "herded" the teacher-members of the (CEC's) to the
Town Hall of San Fernando, where the ballot boxes were forced open and the
contents thereof substituted with pre-prepared ballots favoring respondent
Biliwang. In fact, some of the genuine ballots replaced with those fake ballots
were produced at the hearing by the teachers who managed to 'save' or
'salvage' them secretly, together with some stubs detached from the fake
ballots which upon comparison appeared wider than the genuine ones (Exhs.
F & G; N, N-1 to N-31; 0, 0-1 to 0-16).

The operation involving the use of force and coercion was so open and
pervasive that after voting a preponderant number of the voting centers were
placed under the control of the terrorists. And the Town Hall of San Fernando
was virtually converted into a 'concentration camp', wherein the teacher-
members of the CEC's for several hours were at the mercy of the armed
goons who were bent to ensure the victory of the incumbent mayor at the
time i.e. respondent Biliwang, at all costs. No watchers were allowed inside;
the relatives and friends of the teachers were kept outside until the early
morning of January 31, 1980. 1

The COMELEC then concluded:

As pointed out above, it is the firm finding and conclusion of the Commission
that there was total failure of election in San Fernando, Pampanga, not
because of threats and coercion, or terrorism inflicted on the voters before or
during election day as in the Antonio Case, but for the threats and coercion or
terrorism and irregularities committed AFTER the elections or specifically the
counting of the votes and in the preparation of the election returns upon the
teacher-members of the Citizens Election Committees (CEC's) without regard
to the genuine ballots in the ballot boxes which were substituted with pre-
prepared ballots favoring respondent Biliwang. 2

Sanchez sought reconsideration of that portion of the COMELEC Resolution

which certified the failure of election in San Fernando to the President/Prime
Minister and the Batasang Pambansa, and prayed instead that the COMELEC
call a special election in San Fernando. Biliwang, for his part, also moved for
reconsideration on the ground that the COMELEC has no authority to annul
the entire municipal election. He prayed that he be proclaimed on the basis of
the undisputed returns. Reconsideration was denied by the COMELEC in both
instances.

On November 19, 1980, Sanchez filed a Petition for certiorari with this Court,
docketed as G.R. No. 55513, wherein he seeks a modification of that portion
of the COMELEC Resolution of May 15, 1980 refusing to call a special election.
He alleges that Section 5 of Batas Pambansa Bilang 52 specifically enjoins the
COMELEC to call a special election if the election results in a failure to elect,
and that by refusing to do so, the Commission has abdicated its duty.

On December 6, 1980, Biliwang instituted, also with this Court, a Petition for
Certiorari, Prohibition and Mandamus, docketed as G.R. No. 55642, assailing
the same COMELEC Resolution and alleging that said body has no power to
annul an entire municipal election because: (a) Article XII-C Section 2(l) of the
Constitution grants to the COMELEC only the power to enforce and administer
all laws relative to the conduct of elections; (b) Section 175 of the 1978
Election Code gave the power to said body to suspend and annul a
proclamation only; and (c) Section 5 of Batas Pambansa Bilang 52 does not
grant it the power to annul municipal elections. He further asserts that the
COMELEC must make a proclamation on the basis of unchallenged returns
when these returns represent a majority of the total election returns.

These two Petitions ere ordered consolidated and were heard by the court en
banc on July 28, 1981. Required to submit Memoranda, Sanchez manifested
that he was waiving the filing of the same as his Petition had exhaustively
discussed and ventilated the facts and issues involved and that he was
adopting his Petition as his Memorandum. Biliwang and the Solicitor General
submitted their respective Memoranda, the former on August 7, 1981 and the
latter on September 4, 1981.

The issues posed are:

1) Does the COMELEC have the power to annul an entire municipal

election on the ground of post-election terrorism?

2) Does the COMELEC have the authority to call for a special election?

Power to Annul an Election

Biliwang asserts that COMELEC lacks the power to annul elections of
municipal officials particularly so because, under Section 190 of the 1978
Election Code, the power to try election contests relative to elective
municipal officials is vested in Courts of First Instance.

Be that as it may, it should be recalled that what COMELEC actually rejected

were the sham and illegal returns in San Fernando, and that the kind of fraud
and terrorism perpetrated thereat was sufficient cause for voiding the
election as a whole. Besides, COMELEC is empowered motu proprio to
suspend and annul any proclamation as, in fact, it did annul Biliwang's
proclamation:

SEC. 175. Suspension and annulment of proclamation. The Commission

shall be the sole judge of all pre-proclamation controversies and any of its
decisions, orders or rulings shall be final and executory. It may, motu proprio
or upon written petition, and after due notice and hearing order the
suspension of the proclamation of a candidate-elect or annul any
proclamation, if one has been made, on any of the grounds mentioned in
Sections 172, 173 and 174 hereof.

Biliwang's claim that he should be proclaimed on the basis of undisputed

returns is devoid of merit in the light of COMELEC's categorical findings that it
was impossible to purge the illegal from the valid returns.

It may be true that there is no specific provision vesting the COMELEC with
authority to annul an election. However, there is no doubt either relative to
COMELEC's extensive powers. Under the Constitution, the COMELEC is tasked
with the function to "enforce and administer all laws relative to the conduct of
elections." 3 The 1978 Election Code (PD No. 1296) accords it exclusive
charge of the enforcement and administration of all laws relative to the
conduct of elections for the purpose of insuring free, orderly and honest
elections (Sec. 185).

The COMELEC found that the local election in San Fernando Pampanga, was
vitiated by post-election widespread and pervasive terrorism and resulted in
the submission of "gunpoint or coerced" returns. In other words, there were
no election returns worthy of faith and credit and from which could be gauged
a fair and true expression of the popular will. Its action, therefore, of rejecting
all election returns and annulling the local elections thereat was but in
keeping with its constitutionally ordained power of administration and
enforcement of election laws and its main objective to insure free, orderly
and honest elections. As it has been rightly said "an election return prepared
at the point of a gun is no return at all; it is not one notch above a falsified
and spurious return. 4 The Comelec has the power to reject returns when in
its opinion they were illegal and not authentic. 5 In fact, it has the duty to
disallow obviously false or fabricated returns, 6 as a falsified or spurious
return amounts to no return at all. 7

Admittedly, in Abes vs. Comelec, 21 SCRA 1252 (1967), this Court had ruled
that the COMELEC is bereft of power to annul an election or to direct a new
one. Then, we said:

Enforcement and administration of all election laws by Comelec do not

include the power to annul an election which may not have been free, orderly
and honest, as such power is merely preventive, and not curative, and if it
fails to accomplish that purpose, it is not for such body to cure or remedy the
resulting evil, but for some other agencies of the Government: the Senate
Electoral Tribunal, the House Electoral Tribunal, or the courts, as the case may
be, who have the power to decide election contests (Nacionalista Party vs.
Comelec, 85 Phil. 149, 155-156).

That case was decided, however, under the aegis of the 1935 Constitution
and the former Revised Election Code. 8 Since then, the powers of the
COMELEC have been considerably expanded it is now "the sole judge of all
contests relating to the elections, returns, and qualifications of all Members of
the Batasang Pambansa and elective provincial and city officials, 9 where
before the power to decide election contests was lodged with the Senate
Electoral Tribunal, the House Electoral Tribunal, or the Courts, as the case
may be. 10

In other words, in line with the plenitude of its powers and its function to
protect the integrity of elections, the COMELEC must be deemed possessed of
authority to annul elections where the will of the voters has been defeated
and the purity of elections sullied. It would be unreasonable to state that the
COMELEC has a legal duty to perform and at the same time deny it the
wherewithal to fulfill that task.

... the Conunission must be given considerable latitude in adopting means

and methods that will ensure the accomplishment of the great objective for
which it was created to promote free, orderly and honest elections. 11

As then Justice Enrique M. Fernando, now the Chief Justice, pointed out in his
concurring opinion in Antonio, Jr., vs. COMELEC, 32 SCRA 319 (1970):

Where majority of the voters of a province failed to cast their votes due to
widespread terrorism committed, the Commission on Elections should annul
the canvass and the proclamation of the winning candidate ...

The fact that widespread terrorism occurred after the elections, and not in the
casting of votes, should make no difference.

Power to call a special election.

On this issue, the COMELEC opined that it had no power to order the holding
of a new or special election, stating .

Although the broad powers and functions and jurisdiction of the Commission
may be gleaned from the foregoing, nevertheless, neither the Constitution
nor the 1978 Election Code and Batas Pambansa Bilang 52 has granted it the
authority and power to call a special election under the peculiar facts and
circumstances of these cases at bar. As pointed out above, it is the firm
finding and conclusion of the Commission that there was total failure of
election in San Fernando, Pampanga, not because of threats and coercion or
terrorism inflicted on the voters before or during election day as in Antonio
Case, but for the threats and coercion or terrorism and irregularities
committed after the elections or specifically in the counting of the votes and
in the preparation of the election returns upon the teacher-members of the
Citizens Election Committees (CEC's) without regard to the genuine ballots in
the ballot boxes which were substituted with prepared ballots favoring
respondent Biliwang .

In other words, this Commission finds that the election itself took place on the
date fixed by law, i.e. January 30, 1980, was not suspended and was
generally peaceful and orderly, but that its validity was impaired by the post-
election acts of terrorism, violence, intimidation and threats which resulted in
the submission of gun-point or coerced election returns.

Under the premises, the Commission has no power, even under Section 7 of
the 1978 Election Code or Section 5 of Batas Pambansa Blg. 52 as quoted
above, to order the holding of a new or special election. The existing laws do
not provide such power. ... ." 12

Thus, the COMELEC deemed it imperative "to certify to the President/Prime

Minister and the Batasang Pambansa the failure of election in San Fernando,
Pampanga, so that remedial legislation may be enacted ...", explaining:

Considering that there is now no Electoral Tribunal as Justice Teehankee, nor

Congress, as Chief Justice Fernando, have separately proposed in the Antonio
Case, the Commission deems it as not only appropriate and necessary, but as
the sole imperative and urgent remedy to certify to the President/Prime
Minister and the Batasang Pambansa the failure of election in San Fernando,
Pampanga, so that remedial legislation may be enacted and that pending
such enactment, the President/Prime Minister may appoint the municipal
officials of San Fernando. 13

The pertinent portion of the concurring opinion of Chief Justice Fernando in

the Antonio case, referred to above, reads:

... and (the Commission on Elections shall) certify to Congress that the right
to vote was frustrated and nullified so that the appropriate remedial measure
in the form of a new election could be provided for by appropriate legislation.

The relevant portion of the concurring Opinion of Mr. Justice Claudio

Teehankee in the same case states:

... The question of whether there remained an election for which a winner
may be proclaimed or whether there was a failure of election since the
remaining returns do not represent a valid constituency under the prevailing
doctrine of the House Electoral Tribunal is one that pertains to the exclusive
jurisdiction of said Tribunal and should be certified thereto as indicated in the
body of this opinion for resolution. 14

In Ututalum vs. Comelec, 15 SCRA 465 (1965), this Court also had occasion to
hold:

The functions of the Commission on Elections under the Constitution are

essentially executive and administrative in nature. Upon the other, the
authority to order the holding of elections on any date other than that fixed in
the Revised Election Code is merely incidental to or an extension or modality
of the power to fix the date of elections. This is, in turn, neither executive nor
administrative, but legislative in character, not only by nature, but, also,
insofar as national elections are concerned, by specific provisions of the
Constitution, for, pursuant thereto, the elections for Senators and members of
the House of Representatives and those for President and Vice- President,
shall be held on the dates "fixed by law" (Article VI, Sec. 8 [1] and Article VII,
Sec. 4 Constitution), meaning an Act of Congress. Hence, no elections may be
held on any other date, except when so provided by another Act of Congress
or upon orders of a body or officer to whom Congress may have delegated,
either its aforementioned power, or the authority to, ascertain or fill in the
details in the execution of said power. There is, however, no such statutory
grant of authority to the Commission on Elections.

Again, the foregoing Opinions were rendered under the regime of the 1935
Constitution and the former Revised Election Code (Republic Act No. 180, as
amended), whereby there was no constitutional nor statutory precept that
empowered the COMELEC to direct a new election after one had already been
held. 15 Under section 8 of that former statute, authority was given to the
President to postpone the election upon the recommendation of the
COMELEC. And Section 21 (c) of the same law authorized the President to
issue a proclamation calling a special election whenever the election for a
local office failed to take place on the date fixed by law. In other words, the
prerogative to postpone an election or call a special election, was formerly
lodged with the President. Besides, the Antonio case involved a House
contest at a time when the House Electoral Tribunal was the sole Judge to
determine the validity of the returns and elections. 16

As the laws now stand, however, COMELEC has been explicitly vested with
the authority to "call for the holding or continuation of the election." Thus,
Section 5 of Batas Pambansa Blg. 52 explicitly provides:

Sec. 5. Failure of Election. whenever for any serious cause such as

violence, terrorism, loss or destruction of election paraphernalia or records,
force majeure and other analogous cases of such nature that the holding of a
free, orderly and honest election should become impossible, the election for a
local office fails to take place on the date fixed by law, or is suspended, or
such election results in a failure to elect, the Commission on Elections shall,
on the basis of a verified petition and after due notice and hearing, call for
the holding or continuation of the election as soon as practicable. (Emphasis
ours)

Section 7 of the Election Code of 1978 (PD No. 1296) similarly provides:

Sec. 7. Failure of election. If on account of force majeure, violence,

terrorism, or fraud the election in any voting center has not been held on the
date fixed or has been suspended before the hour fixed by law for the closing
of the voting and such failure or suspension of election in any voting center
would affect the result of the election, the Commission may on the basis of a
verified petition and after due notice and hearing, call for the holding or
continuation of the election not held or suspende.

Section 8 of the same 1978 Election Code empowers the COMELEC to call a
special election to fill a vacancy or a newly created elective position.

SEC. 8. Call of special election. Special elections shall be called by the

Commission by proclamation on a date to be fixed by it, which shall specify
the offices to be voted for, that it is for the purpose of filling a vacancy or a
newly created elective position, as the case may be."
Clearly, under Section 5 of Batas Pambansa Blg. 52, abovequoted, when the
election "results in a failure to elect, the COMELEC may call for the holding or
continuation of the election as soon as practicable." We construe this to
include the calling of a special election in the event of a failure to elect in
order to make the COMELEC truly effective in the discharge of its functions. In
fact, Section 8 of the 1978 Election Code, supra, specifically allows the
COMELEC to call a special election for the purpose of filling a vacancy or a
newly created position, as the case may be. There should be no reason,
therefore, for not allowing it to call a special election when there is a failure to
elect. We do not share the view of public respondent and the Solicitor General
that the power of the COMELEC to call for special elections is circumscribed
by the very same Section 5 of Batas Pambansa Blg. 52 itself, and that "the
San Fernando situation is not within its ambit 17 ". More specifically, their
position is:

Weighing incontrovertibly against the petitioner's claim is the language of the

law itself. What does Section 5, Batas Pambansa Blg. 52 say? lt states that
the Commission is empowered to call for the "holding or continuation of the
election as soon as practicable" where: (1) 'the holding of a free, orderly and
honest election should become impossible; (2) 'the election for a local office
fails to take place on the date fixed by law; (3) 'the erection for a local
office ... on the date fixed by law is suspended; and (4) 'such election results
in a failure to elect ... .

An examination of the foregoing enumeration clearly reveals that the same

essentially and solely refer to the casting of ballots for the public office
concerned. Surely, this is a clear case of ejusdem generis. The last of the
enumerated situations must hew to the same specific meaning as the first
three. And clearly, the first three enumerated instances refer to the actual
casting of ballots. The petitioner's general definition cannot apply here. The
failure to elect must, therefore, result specifically from a failure relative to the
casting of ballots. This envisions a situation where an election is not
impossible to hold; neither does it fail to take place; nor is it suspended; but
nevertheless, the voters are unable to cast their votes, due to the operation
on such voters of either violence, terrorism, loss or destruction of election
paraphernalia or records, force majeure and other analogous cases. Here,
there was no failure relative to the free and voluntary casting of votes on the
part of the voters.
The petitioner's attempt then to interpret the terms 'election' in the above
provision of law as including, not only the casting of ballots, but the counting
thereof, the preparation of election returns, canvass and proclamation is,
indeed, misplaced in the light of the language of the above controlling
provision of law.

It is not to be doubted that the voters in San Fernando cast their votes freely
and voluntarily before the various CEC's of the municipality. In the light of the
above provision of law, election had actually taken place. As the evidence
clearly shows, the 'failure to elect' here was the result of the operation of a
massive, systematic and palpably evil operation to: (1) substitute fake for
genuine ballots; (2) manufacture election returns at gunpoint; and (3) secure
a proclamation on the basis of these false documents. Because of these
illegal manuevers to frustrate the will of the electorate, there was, more
accurately, a failure to gauge the true and genuine will of the electorate,
rather than a failure of election. Ballots were duly cast, but because of the
above massive and systematic operations to frustrate the electorate's will,
their true and authentic vote could not be ascertained. 18

In a nutshell, it is contended that "the illegal maneuvers to frustrate the will

of the electorate was, more accurately, a failure to gauge the true and
genuine will of the electorate, rather than a failure of election;" that the
COMELEC could no longer call for the holding of a special election in this case
because fraud and terrorism were committed after the voters had already
cast their ballots, and therefore, elections had actually taken place; and that
for there to be a failure to elect, it must result specifically from a failure
relative to the casting of ballots.

It should be recalled that the COMELEC found the post-election acts of

terrorism in San Fernando so massive and pervasive in nature that it rejected
all the returns. It made the "firm finding and conclusion ... that there was
total failure of election in San Fernando, Pampanga. 19 When all the returns
are void, it cannot be gainsaid that there was a failure to elect. But to state
that this is not the failure of election contemplated by Batas Pambansa Blg.
52 because elections did take place is, to our minds, too tenuous a
distinction. In practical effect, no election has at all been held; there has been
in truth and in fact, a failure to elect.
It would be to circumscribe the power of the COMELEC to ensure free, orderly
and honest elections if we were to hold that the COMELEC authority to call for
the holding of the election is applicable only when the causes therefor
occurred before the elections; in other words, that the grounds for calling
special elections do not include post-election terrorism. That interpretation
would not only hamper the effectiveness of the COMELEC in the discharge of
its functions but it would also, in case of failure. To elect due to post-election
terrorism, delay the opportunity to the voters to cast their votes at the
earliest possible time. The electorate should not be disenfranchised for long
and the COMELEC should not be prevented from taking the necessary steps
to complete the elections. After all, the casting of ballots is not the only act
constitutive of elections. An election is not complete until proclamation has
been made.

An election is not an election and popular will is not deemed to have been
expressed until the last act necessary to complete the election under the law
has been performed. Under the laws of the Philippines the act which
completes the election is the proclamation of the provincial board of
canvassers. 20

In fine, we uphold the power and prerogative of the COMELEC to annul an

election where the will of the voters has been defeated, as well as to call for a
special election where widespread terrorism, whether before or after election,
has been proven resulting in a failure to elect, without need of recourse to the
President and the Batasang Pambansa for the enactment of remedial
legislation.

Biliwang raises for the first time on review his right to a "hold-over". Not only
has this been belatedly raised but the fact also remains that his elective term
expired on December 31, 1975 and that he already held-over by virtue of PD
No. 1576. He ceased to hold-over, however, when elections were held on
January 30, 1980, besides the fact that the President has already appointed
an officer-in-charge in San Fernando, Pampanga.

WHEREFORE, 1) in G. R. No. 55513, the challenged Resolution of May 15,

1980 is hereby modified, and the Commission on Elections hereby held
empowered to call a special election where there has been a failure to elect.
That portion which certifies the failure of election in San Fernando,
Pampanga, to the President and the Batasang Pambansa for the enactment of
remedial measures, is hereby set aside.

2) In G. R. No. 55642, the petition is hereby denied for lack of merit, and
the authority of the Commission on Elections to annul an election hereby
upheld.

No costs.

SO ORDERED.

EN BANC

[G.R. No. 134096. March 3, 1999]

JOSEPH PETER S. SISON, petitioner, vs. COMMISSION ON ELECTIONS,

respondents.

DECISION

ROMERO, J.:

Before this Court is a petition for certiorari under Rule 65 of the Revised Rules
of Court which impugns the Resolution[1] of public respondent Commission
on Elections (COMELEC) dated June 22, 1998 that dismissed petitioner Joseph
Peter S. Sison's earlier petition[2] in SPC No. 98-134, entitled In the Matter of
the Petition to Suspend the Canvassing of Votes and/or Proclamation in
Quezon City and to Declare a Failure of Elections.

It appears that while the election returns were being canvassed by the
Quezon City Board of Canvassers but before the winning candidates were
proclaimed, petitioner commenced suit before the COMELEC by filing a
petition seeking to suspend the canvassing of votes and/or proclamation in
Quezon City and to declare a failure of elections. The said petition was
supposedly filed pursuant to Section 6[3] of the Omnibus Election Code
(Batas Pambansa Blg. 881, as amended) on the ground of massive and
orchestrated fraud and acts analogous thereto which occurred after the
voting and during the preparation of election returns and in the custody or
canvass thereof, which resulted in a failure to elect.[4]

In support of his allegation of massive and orchestrated fraud, petitioner cited

specific instances which are summarized and set forth below:

1. The Board of Canvassers announced that election returns with no inner

seal would be included in the canvass;

2. Board of Election Inspectors brought home copies of election returns meant

for the City Board of Canvassers;

3. Petitioner, through counsel, raised written objections to the inclusion in the

canvass of election returns which were either tampered with, altered or
falsified, or otherwise not authentic;

4. According to the minutes of the City Board of Canvassers, there were

precincts with missing election returns;

5. Several election returns with no data on the number of votes cast for vice
mayoralty position;

6. Highly suspicious persons sneaking in some election returns and

documents into the canvassing area;

7. Concerned citizen found minutes of the counting, keys, locks and metal
seal in the COMELEC area for disposal as trash;

8. Board of Election Inspectors have volunteered information that they placed

the copy of the election returns meant for the City Board of Canvassers in the
ballot boxes deposited with the City Treasurer allegedly due to fatigue and
lack of sleep;

9. Ballot boxes were never in the custody of the COMELEC and neither the
parties nor their watchers were allowed to enter the restricted area where
these boxes passed through on the way to the basement of the City Hall
where they were supposedly kept; and

10. In the elections in Barangay New Era, there was a clear pattern of voting
which would show that the election returns were manufactured and that no
actual voting by duly qualified voters took place therein.

While the petition was pending before the COMELEC, the City Board of
Canvassers proclaimed the winners of the elections in Quezon City, including
the winning candidate for the post of vice mayor. On June 22, 1998, the
COMELEC promulgated its challenged resolution dismissing the petition
before it on the ground (1) that the allegations therein were not supported by
sufficient evidence, and (2) that the grounds recited were not among the pre-
proclamation issues set fourth in Section 17 of Republic Act No. 7166.[5]

Hence, this petition.

Alleging that COMELEC overstepped the limits of reasonable exercise of

discretion in dismissing SPC No. 98-134, petitioner argues in the main that
the electoral body failed to afford him basic due process, that is, the right to a
hearing and presentation of evidence before ruling on his petition. He then
proceeded to argue that the election returns themselves, as well as the
minutes of the canvassing committee of the City Board of Canvassers were,
by themselves, sufficient evidence to support the petition.

Upon a meticulous study of the parties arguments together with the pertinent
statutory provisions and jurisprudence, this Court is of the opinion that there
is no compelling reason why we should withhold our imprimatur from the
questioned resolution.
At the outset, we notice that petitioner exhibits an ambivalent stand as to
what exactly is the nature of the remedy he availed of at the time he initiated
proceedings before the COMELEC in SPC No. 98-134. At the start, he anchors
his initiatory petition under Section 6[6] of the Omnibus Election Code
regarding failure of elections but he later builds his case as a pre-
proclamation controversy which is covered by Sections 241-248 of the
Omnibus Election Code, as amended by R.A. No. 7166.[7] In this respect, the
rule is, what conjointly determine the nature of a pleading are the allegations
therein made in good faith, the stage of the proceeding at which it is filed,
and the primary objective of the party filing the same.

In any case, petitioner nonetheless cannot succeed in either of the remedies

he opted to pursue. Recently, in Matalam v. Commission on Elections,[8] we
have already declared that a pre-proclamation controversy is not the same as
an action for annulment of election results or declaration of failure of
elections, founded as they are on different grounds.

Under the pertinent codal provision of the Omnibus Election Code, there are
only three (3) instances where a failure of elections may be declared, namely:
(a) the election in any polling place has not been held on the date fixed on
account of force majeure, violence, terrorism, fraud, or other analogous
causes; (b) the election in any polling place had been suspended before the
hour fixed by law for the closing of the voting on account of force majeure,
violence, terrorism, fraud, or other analogous causes; or (c) after the voting
and during the preparation and transmission of the election returns or in the
custody or canvass thereof, such election results in a failure to elect on
account of force majeure, violence, terrorism , fraud, or other analogous
causes.[9] (Underscoring supplied) We have painstakingly examined
petitioners petition before the COMELEC but found nothing therein that could
support an action for declaration of failure of elections. He never alleged at
all that elections were either not held or suspended. Furthermore, petitioners
claim of failure to elect stood as a bare conclusion bereft of any substantive
support to describe just exactly how the failure to elect came about.

With respect to pre-proclamation controversy, it is well to note that the scope

of pre-proclamation controversy is only limited to the issues enumerated
under Section 243[10] of the Omnibus Election Code, and the enumeration
therein is restrictive and exclusive.[11] The reason underlying the
delimitation both of substantive ground and procedure is the policy of the
election law that pre-proclamation controversies should be summarily
decided, consistent with the law's desire that the canvass and proclamation
be delayed as little as possible.[12] That is why such questions which require
more deliberate and necessarily longer consideration, are left for examination
in the corresponding election protest.[13]

However, with the proclamation of the winning candidate for the position
contested, the question of whether the petition raised issues proper for a pre-
proclamation controversy is already of no consequence since the well-
entrench rule in such situation is that a pre-proclamation case before the
COMELEC is no longer viable, the more appropriate remedies being a regular
election protest or a petition for quo warranto.[14] We have carefully
reviewed all recognized exceptions[15] to the foregoing rule but found
nothing that could possibly apply to the instant case based on the recitations
of the petition. What is more, in paragraph 3 of the COMELECs Omnibus
Resolution No. 3049 (Omnibus Resolution on Pending Cases) dated June 29,
1998, it is clearly stated therein that All other pre-proclamation cases x x x
shall be deemed terminated pursuant to Section 16, R. A. 7166.[16]
(Underscoring supplied). Section 16 which is referred to in the aforecited
omnibus resolution refers to the termination of pre-proclamation cases when
the term of the office involved has already begun, which is precisely what
obtains here. We are, of course, aware that petitioner cites the said omnibus
resolution in maintaining that his petition is one of those cases which should
have remained active pursuant to paragraph 4 thereof. That exception,
however, operates only when what is involved is not a pre-proclamation
controversy such as petitions for disqualification, failure of elections or
analogous cases. But as we have earlier declared, his petition, though
assuming to seek a declaration of failure of elections, is actually a case of
pre-proclamation controversy and, hence, not falling within the ambit of the
exception. In any case, that omnibus resolution would not have been applied
in the first place because that was issued posterior to the date when the
herein challenge resolution was promulgated which is June 22, 1998. There
was no provision that such omnibus resolution should have retroactive effect.

Finally, as to petitioners claim that he was deprived of his right to due

process in that he was not allowed to present his evidence before the
COMELEC to support his petition, the same must likewise fail.

First, we note that his citation of Section 242 of the Omnibus Election Code as
basis for his right to present evidence is misplaced. The phrase after due
notice refers only to a situation where the COMELEC decides and, in fact,
takes steps to either partially or totally suspend or annul the proclamation of
any candidate-elect. Verba legis non est recedendum. From the words of the
statute there should be no departure. The statutory provision cannot be
expanded to embrace any other situation not contemplated therein such as
the one at bar where the COMELEC is not taking any step to suspend or annul
a proclamation.

Second, presentation of evidence before the COMELEC is not at all

indispensable in order to satisfy the demands of due process. Under the
amendment introduced by R.A. No. 7166, particularly Section 18 thereof, all
that is required now is that the COMELEC shall dispose of pre-proclamation
controversies on the basis of the records and evidence elevated to it by the
board of canvassers. This is but in keeping with the policy of the law that
cases of this nature should be summarily decided and the will of the
electorate as reflected on the election returns be determined as speedily as
possible. What exactly those records and evidence are upon which the
COMELEC based its resolution and how they have been appreciated in
respect of their sufficiency, are beyond this Courts scrutiny. But we have
reason to believe, owing to the presumption of regularity of performance of
official duty and the precept that factual findings of the COMELEC based on
its assessments and duly supported by gathered evidence, are conclusive
upon the court, that the COMELEC did arrive at its conclusion with due regard
to the available evidence before it. That this is so can, in fact, be gleaned
from petitioners own allegation and admission in his petition that the election
returns themselves as well as the minutes of the Canvassing Committees and
the City Board of Canvassers x x x are in the possession of the COMELEC.[17]
He even cites paragraph (g), Section 20 of the Omnibus Election Code to
validate such allegation. Hence, it is not really correct to say that the
COMELEC acted without evidentiary basis at all or that petitioner was
deprived of his right to due process.

WHEREFORE, finding no grave abuse of discretion amounting to lack or

excess of jurisdiction on the part of public respondent Commission on
Elections (COMELEC), the instant petition is hereby DISMISSED.
Consequently, the resolution of COMELEC in SPC No. 98-134 dated June 22,
1998 is AFFIRMED.

No costs.
SO ORDERED.

EN BANC

[G.R. No. 108399. July 31, 1997]

RAFAEL M. ALUNAN III, in his capacity as Secretary of the

Department of Interior and Local Government (DILG), the BOARD OF
ELECTION SUPERVISORS composed of Atty. RUBEN M. RAMIREZ, Atty.
RAFAELITO GARAYBLAS, and Atty. ENRIQUE C. ROA, GUILLERMINA
RUSTIA, in her capacity as Director of the Barangay Bureau, City
Treasurer Atty. ANTONIO ACEBEDO, Budget Officer EUFEMIA
DOMINGUEZ, all of the City Government of Manila, petitioners, vs.
ROBERT MIRASOL, NORMAN T. SANGUYA, ROBERT DE JOYA, ARNEL R.
LORENZO, MARY GRACE ARIAS, RAQUEL L. DOMINGUEZ, LOURDES
ASENCIO, FERDINAND ROXAS, MA. ALBERTINA RICAFORT,and BALAIS
M. LOURICH, and the HONORABLE WILFREDO D. REYES,Presiding
Judge of the Regional Trial Court, Branch 36, Metro Manila,
respondents.

DECISION

MENDOZA, J.:

This is a petition for review on certiorari of the decision dated January 19,
1993 of the Regional Trial Court of Manila (Branch 36),[1] nullifying an order
of the Department of Interior and Local Government (DILG), which in effect
cancelled the general elections for the Sangguniang Kabataan (SK) slated on
December 4, 1992 in the City of Manila, on the ground that the elections
previously held on May 26, 1990 served the purpose of the first elections for
the SK under the Local Government Code of 1991 (R.A. No. 7160).

Section 423 of the Code provides for a SK in every barangay, to be composed

of a chairman, seven (7) members, a secretary, and a treasurer. Section
532(a) provides that the first elections for the SK shall be held thirty (30)
days after the next local elections. The Code took effect on January 1, 1992.

The first local elections under the Code were held on May 11, 1992.
Accordingly, on August 27, 1992, the Commission on Elections issued
Resolution No. 2499, providing guidelines for the holding of the general
elections for the SK on September 30, 1992. The guidelines placed the SK
elections under the direct control and supervision of the DILG, with the
technical assistance of the COMELEC.[2] After two postponements, the
elections were finally scheduled on December 4, 1992.

Accordingly, registration in the six districts of Manila was conducted. A total

of 152,363 youngsters, aged 15 to 21 years old, registered, 15,749 of them
filing certificates of candidacies. The City Council passed the necessary
appropriations for the elections.

On September 18, 1992, however, the DILG, through then Secretary Rafael M.
Alunan III, issued a letter-resolution exempting the City of Manila from holding
elections for the SK on the ground that the elections previously held on May
26, 1990 were to be considered the first under the newly-enacted Local
Government Code. The DILG acted on a letter of Joshue R. Santiago, acting
president of the KB City Federation of Manila and a member of City Council of
Manila, which called attention to the fact that in the City of Manila elections
for the Kabataang Barangay (the precursor of the Sangguniang Kabataan)
had previously been held on May 26, 1990. In its resolution, the DILG stated:

[A] close examination of . . . RA 7160 would readily reveal the intention of the
legislature to exempt from the forthcoming Sangguniang Kabataan elections
those kabataang barangay chapters which may have conducted their
elections within the period of January 1, 1988 and January 1, 1992 under BP
337. Manifestly the term of office of those elected KB officials have been
correspondingly extended to coincide with the term of office of those who
may be elected under RA 7160.

On November 27, 1992 private respondents, claiming to represent the 24,000

members of the Katipunan ng Kabataan, filed a petition for certiorari and
mandamus in the RTC of Manila to set aside the resolution of the DILG. They
argued that petitioner Secretary of Interior and Local Government had no
power to amend the resolutions of the COMELEC calling for general elections
for SKs and that the DILG resolution in question denied them the equal
protection of the laws.

On November 27, 1992, the trial court, through Executive Judge, now
COMELEC Chairman, Bernardo P. Pardo, issued an injunction, ordering
petitioners to desist from implementing the order of the respondent Secretary
dated September 18, 1992, . . . until further orders of the Court. On the same
day, he ordered petitioners to perform the specified pre-election activities in
order to implement Resolution No. 2499 dated August 27, 1992 of the
Commission on Elections providing for the holding of a general election of the
Sangguniang Kabataan on December 4, 1992 simultaneously in every
barangay throughout the country.

The case was subsequently reraffled to Branch 36 of the same court. On

January 19, 1993, the new judge, Hon. Wilfredo D. Reyes, rendered a
decision, holding that (1) the DILG had no power to exempt the City of Manila
from holding SK elections on December 4, 1992 because under Art. IX, C, 2(1)
of the Constitution the power to enforce and administer all laws and
regulations relative to the conduct of an election, plebiscite, initiative,
referendum, and recall is vested solely in the COMELEC; (2) the COMELEC had
already in effect determined that there had been no previous elections for KB
by calling for general elections for SK officers in every barangay without
exception; and (3) the exemption of the City of Manila was violative of the
equal protection clause of the Constitution because, according to the DILGs
records, in 5,000 barangays KB elections were held between January 1, 1988
and January 1, 1992 but only in the City of Manila, where there were 897
barangays, was there no elections held on December 4, 1992.

Petitioners sought this review on certiorari. They insist that the City of Manila,
having already conducted elections for the KB on May 26, 1990, was
exempted from holding elections on December 4, 1992. In support of their
contention, they cite 532(d) of the Local Government Code of 1991, which
provides that:

All seats reserved for the pederasyon ng mga sangguniang kabataan in the
different sanggunians shall be deemed vacant until such time that the
sangguniang kabataan chairmen shall have been elected and the respective
pederasyon presidents have been selected: Provided, That, elections for the
kabataang barangay conducted under Batas Pambansa Blg. 337 at any time
between January 1, 1988 and January 1, 1992 shall be considered as the first
elections provided for in this Code. The term of office of the kabataang
barangay officials elected within the said period shall be extended
correspondingly to coincide with the term of office of those elected under this
Code. (emphasis added)
They maintain that the Secretary of the DILG had authority to determine
whether the City of Manila came within the exception clause of 532(d) so as
to be exempt from holding the elections on December 4, 1992.

The preliminary question is whether the holding of the second elections on

May 13, 1996[3] rendered this case moot and academic. There are two
questions raised in this case. The first is whether the Secretary of Interior and
Local Government can exempt a local government unit from holding elections
for SK officers on December 4, 1992 and the second is whether the COMELEC
can provide that the Department of Interior and Local Government shall have
direct control and supervision over the election of sangguniang kabataan with
the technical assistance by the Commission on Elections.

We hold that this case is not moot and that it is in fact necessary to decide
the issues raised by the parties. For one thing, doubt may be cast on the
validity of the acts of those elected in the May 26, 1990 KB elections in
Manila because this Court enjoined the enforcement of the decision of the
trial court and these officers continued in office until May 13, 1996. For
another, this case comes within the rule that courts will decide a question
otherwise moot and academic if it is capable of repetition, yet evading
review.[4] For the question whether the COMELEC can validly vest in the DILG
the control and supervision of SK elections is likely to arise in connection with
every SK election and yet the question may not be decided before the date of
such elections.

In the Southern Pacific Terminal case, where the rule was first articulated,
appellants were ordered by the Interstate Commerce Commission to cease
and desist from granting a shipper what the ICC perceived to be preferences
and advantages with respect to wharfage charges. The cease and desist
order was for a period of about two years, from September 1, 1908
(subsequently extended to November 15), but the U.S. Supreme Court had
not been able to hand down its decision by the time the cease and desist
order expired. The case was decided only on February 20, 1911, more than
two years after the order had expired. Hence, it was contended that the case
had thereby become moot and the appeal should be dismissed. In rejecting
this contention, the Court held:
The question involved in the orders of the Interstate Commerce Commission
are usually continuing (as are manifestly those in the case at bar), and these
considerations ought not to be, as they might be, defeated, by short-term
orders, capable of repetition, yet evading review, and at one time the
government, and at another time the carriers, have their rights determined
by the Commission without a chance of redress.[5]

In Roe v. Wade,[6] petitioner, a pregnant woman, brought suit in 1970

challenging anti-abortion statutes of Texas and Georgia on the ground that
she had a constitutional right to terminate her pregnancy at least within the
first trimester. The case was not decided until 1973 when she was no longer
pregnant. But the U.S. Supreme Court refused to dismiss the case as moot. It
was explained: [W]hen, as here, pregnancy is a significant fact in the
litigation, the normal 266-day human gestation period is so short that the
pregnancy will come to term before the usual appellate process is complete.
If that termination makes a case moot, pregnancy litigation seldom will
survive. Our laws should not be that rigid. Pregnancy provides a classic
justification for a conclusion of nonmootness. It truly could be capable of
repetition, yet evading review.[7]

We thus reach the merits of the questions raised in this case. The first
question is whether then DILG Secretary Rafael M. Alunan III had authority to
determine whether under 532(d) of the Local Government Code, the City of
Manila was required to hold its first elections for SK. As already stated,
petitioners sustain the affirmative side of the proposition. On the other hand,
respondents argue that this is a power which Art.IX,C, 2(1) of the Constitution
vests in the COMELEC. Respondents further argue that, by mandating that
elections for the SK be held on December 4, 1992 in every barangay, the
COMELEC in effect determined that there had been no elections for the KB
previously held in the City of Manila.

We find the petition to be meritorious.

First. As already stated, by 4 of Resolution No. 2499, the COMELEC placed the
SK elections under the direct control and supervision of the DILG. Contrary to
respondents contention, this did not contravene Art. IX, C, 2(1) of the
Constitution which provides that the COMELEC shall have the power to
enforce and administer all laws and regulations relative to the conduct of an
election, plebiscite, initiative, referendum, and recall. Elections for SK officers
are not subject to the supervision of the COMELEC in the same way that, as
we have recently held, contests involving elections of SK officials do not fall
within the jurisdiction of the COMELEC. In Mercado v. Board of Election
Supervisors,[8] it was contended that

COMELEC Resolution No. 2499 is null and void because: (a) it prescribes a
separate set of rules for the election of the SK Chairman different from and
inconsistent with that set forth in the Omnibus Election Code, thereby
contravening Section 2, Article 1 of the said Code which explicitly provides
that it shall govern all elections of public officers; and, (b) it constitutes a
total, absolute, and complete abdication by the COMELEC of its
constitutionally and statutorily mandated duty to enforce and administer all
election laws as provided for in Section 2(1), Article IX-C of the Constitution;
Section 52, Article VIII of the Omnibus Election Code; and Section 2, Chapter
1, Subtitle C, Title 1, Book V of the 1987 Administrative Code.[9]

Rejecting this contention, this Court, through Justice Davide, held:

Section 252 of the Omnibus Election Code and that portion of paragraph (2),
Section 2, Article IX-C of the Constitution on the COMELECs exclusive
appellate jurisdiction over contests involving elective barangay officials refer
to the elective barangay officials under the pertinent laws in force at the time
the Omnibus Election Code was enacted and upon the ratification of the
Constitution. That law was B.P. Blg. 337, otherwise known as the Local
Government Code, and the elective barangay officials referred to were the
punong barangay and the six sangguniang bayan members. They were to be
elected by those qualified to exercise the right of suffrage. They are also the
same officers referred to by the provisions of the Omnibus Election Code of
the Philippines on election of barangay officials. Metropolitan and municipal
trial courts had exclusive original jurisdiction over contests relating to their
election. The decisions of these courts were appealable to the Regional Trial
Courts.

....

In the light of the foregoing, it is indisputable that contests involving elections

of SK (formerly KB) officials do not fall within Section 252 of the Omnibus
Election Code and paragraph 2, Section 2, Article IX-C of the Constitution and
that no law in effect prior to the ratification of the Constitution had made the
SK chairman an elective barangay official. His being an ex-officio member of
the sangguniang barangay does not make him one for the law specifically
provides who are its elective members, viz., the punong barangay and the
seven regular sangguniang barangay members who are elected at large by
those who are qualified to exercise the right of suffrage under Article V of the
Constitution and who are duly registered voters of the barangay.[10]

The choice of the DILG for the task in question was appropriate and was in
line with the legislative policy evident in several statutes. Thus, P.D. No. 684
(April 15, 1975), in creating Kabataang Barangays in every barangay
throughout the country, provided in 6 that the Secretary of Local Government
and Community Development shall promulgate such rules and regulations as
may be deemed necessary to effectively implement the provisions of this
Decree. Again, in 1985 Proclamation No. 2421 of the President of the
Philippines, in calling for the general elections of the Kabataang Barangay on
July 13-14, 1985, tasked the then Ministry of Local Government, the Ministry
of Education, Culture and Sports, and the Commission on Elections to assist
the Kabataang Barangay in the conduct of the elections. On the other hand,
in a Memorandum Circular dated March 7, 1988, President Corazon C. Aquino
directed the Secretary of Local Government to issue the necessary rules and
regulations for effecting the representation of the Kabataang Barangay,
among other sectors, in the legislative bodies of the local government units.

The role of the COMELEC in the 1992 elections for SK officers was by no
means inconsequential. DILG supervision was to be exercised within the
framework of detailed and comprehensive rules embodied in Resolution No.
2499 of the COMELEC. What was left to the DILG to perform was the
enforcement of the rules.

Second. It is contended that, in its resolution in question, the COMELEC did

not name the barangays which, because they had conducted kabataang
barangay elections between January 1, 1988 and January 1, 1992, were not
included in the SK elections to be held on December 4, 1992. That these
barangays were precisely to be determined by the DILG is, however, fairly
inferable from the authority given to the DILG to supervise the conduct of the
elections. Since 532(d) provided for kabataang barangay officials whose term
of office was extended beyond 1992, the authority to supervise the conduct
of elections in that year must necessarily be deemed to include the authority
to determine which kabataang barangay would not be included in the 1992
elections.

The authority granted was nothing more than the ascertainment of a fact,
namely, whether between January 1, 1988 and January 1, 1992 elections had
been held in a given kabataang barangay. If elections had been conducted,
then no new elections had to be held on December 4, 1992 since by virtue of
532(d) the term of office of the kabataang barangay officials so elected was
extended correspondingly to coincide with the term of office of those elected
under [the Local Government Code of 1991]. In doing this, the Secretary of
Interior and Local Government was to act merely as the agent of the
legislative department, to determine and declare the event upon which its
expressed will was to take effect.[11] There was no undue delegation of
legislative power but only of the discretion as to the execution of a law. That
this is constitutionally permissible is the teaching of our cases.[12]

Third. Respondents claim, however, that the May 26, 1990 KB elections in
Manila were void because (a) they were called at the instance of then Mayor
Gemiliano C. Lopez who did not have authority to do so and (b) it was not
held under COMELEC supervision.

The 1990 elections for the Kabataang Barangay were called by then Manila
Mayor Gemiliano C. Lopez, Jr., who in his Executive Order No. 21 dated April
25, 1990 stated:

WHEREAS, the Kabataang Barangay as an organization provided for under

Batas Pambansa Bilang 337, has been practically dormant since the advent of
the present national administration;

WHEREAS, there is an urgent need to involve the youth in the affairs and
undertakings of the government to ensure the participation of all sectors of
our population in the task of nation building;

WHEREAS, the last elections for the Kabataang Barangay officers were held in
November 1985 yet, which is over their three years term of office;
WHEREAS, most of the present crop of KB officers are way past the age limit
provided for under the law;

....

The elections were actually held on May 26, 1990 in the 897 barangays of
Manila. Later, on June 30, 1990, KB City Federation elections were conducted.

It was precisely to foreclose any question regarding the validity of KB

elections held in the aftermath of the EDSA revolution and upon the
effectivity of the new Local Government Code that the exception clause of
532(d) was inserted. The proceedings of the Bicameral Conference
Committee which drafted the Code show the following:[13]

CHAIRMAN DE PEDRO: Isa-cite na lang ko ano iyong title o chapter o section,

ha!

HON. LINA: . . .

Page 436, lines 13 to 14 delete within eighteen months prior to December 31,
1990, and in lieu thereof, insert from 1988 up to the effectivity of the Code.
The rationale. . . .

CHAIRMAN DE PEDRO: How should it be read?

HON. LINA: It will read as follows: Provided however, that the Local
Government Units which have conducted elections for the Kabataang
Barangay as provided for, in Batas Pambansa Bilang 337, up to the effectivity.
...
CHAIRMAN DE PEDRO: So, any deletion from the word within, ha, up to. . . .

HON. LINA: Remove the words, the phrase, within eighteen months prior to
December 31, 1990, and insert from 1988 up to the effectivity of this Code.

CHAIRMAN DE PEDRO: From?

HON. LINA: From 1988 up to the effectivity of this Code. Kasi meron nang
mga election, eh, na ginawa, eh. There are five thousand barangays, based
on the record of the DILG, out of forty thousand, imagine that, na nag-
conduct na ng election nila based on the KB Constitution and By-Laws, and
theyre sitting already, now if we do not recognize that, mag[ka]karoon sila ng
question.

CHAIRMAN DE PEDRO: Accepted, Mr. Chairman.

Section 532(d) may thus be deemed to be a curative law. Curative laws,

which in essence are retrospective in effect, are enacted to validate acts
done which otherwise would be invalid under existing laws, by considering
them as having complied with the existing laws. Such laws are recognized in
this jurisdiction.[14]

Fourth. It is finally contended that the exemption of the barangays of the City
of Manila from the requirement to hold elections for SK officers on December
4, 1992 would deny the youth voters in those barangays of the equal
protection of laws. Respondents claim that only in the barangays in the City
of Manila, which then numbered 897, were elections for SK not held in 1992
on the ground that between January 1, 1988 and January 1, 1992 there had
already been SK elections held, when, according to petitioners own evidence,
during that period, SK elections had actually been conducted in 5,000
barangays.

Whether this claim is true cannot be ascertained from the records of this
case. Merely showing that there were 5,000 barangays which similarly held
KB elections between January 1, 1988 and January 1, 1992 does not prove
that despite that fact these same barangays were permitted to hold elections
on December 4, 1992. For one thing, according to the Manila Bulletin issue of
November 18, 1992 (p. 9), 568 barangays in the Province of Bulacan did not
have SK elections on December 4, 1992 either, because they already had
elections between January 1, 1988 and January 1, 1992. For another, even
assuming that only barangays in Manila were not permitted to hold SK
elections on December 4, 1992 while the rest of the 5,000 barangays were
allowed even if KB elections had already been held there before, this fact
does not give the youth voters in the 897 Manila barangays ground for
complaint because what the other barangays did was contrary to law. There
is no discrimination here.

In People v. Vera[15] this Court struck down the Probation Law because it
permitted unequal application of its benefits by making its applicability
depend on the decision of provincial governments to appropriate or not to
appropriate funds for the salaries of probation officers, with the result that
those not disposed to allow the benefits of probations to be enjoyed by their
inhabitants could simply omit to provide for the salaries of probation officers.
The difference between that case and the one at bar lies in the fact that what
youth voters in the other barangays might have been allowed was not a right
which was denied to youth voters in Manila. If those barangays were not
entitled to have SK elections on December 4, 1992 but nevertheless were
allowed to have such elections, that fact did not mean those in Manila should
similarly have been allowed to conduct elections on December 4, 1992
because the fact was that they already had their own, just two years before
on May 26, 1990. Respondents equal protection argument violates the dictum
that one wrong does not make another wrong right.

WHEREFORE, the decision of the Regional Trial Court of Manila, Branch 36 is

REVERSED and the case filed against petitioner by private respondents is
DISMISSED.

SO ORDERED.

EN BANC

[G.R. No. 147392. March 12, 2004]

BENEDICTO ERNESTO R. BITONIO, JR., petitioner, vs. COMMISSION ON
AUDIT and CELSO D. GANGAN, CHAIRMAN OF THE COMMISSION ON
AUDIT, respondents.

DECISION

CALLEJO, SR., J.:

The instant petition filed under Rule 64 of the Revised Rules of Court seeks
the annulment of the Decision[1] of the Commission on Audit (COA) dated
January 30, 2001 denying the petitioners motion for the reconsideration of
the COA Notices of Disallowance Nos. 98-008-101 (95) and 98-017-101 (97)
dated July 31, 1998 and October 9, 1998, respectively, involving the per
diems the petitioner received from the Philippine Economic Zone Authority
(PEZA). In order to avoid multiplicity of suits, an Amended Petition[2] dated
August 16, 2002 was later filed to include in the resolution of the instant
petition Notice of Disallowance No. 98-003-101 (96) dated July 31, 1998
which was belatedly received by the petitioner on August 13, 2002.

The antecedent facts are as follows:

In 1994, petitioner Benedicto Ernesto R. Bitonio, Jr. was appointed Director IV

of the Bureau of Labor Relations in the Department of Labor and
Employment.

In a Letter dated May 11, 1995 addressed to Honorable Rizalino S. Navarro,

then Secretary of the Department of Trade and Industry, Acting Secretary
Jose S. Brilliantes of the Department of Labor and Employment designated
the petitioner to be the DOLE representative to the Board of Directors of
PEZA.[3] Such designation was in pursuance to Section 11 of Republic Act No.
7916, otherwise known as the Special Economic Zone Act of 1995, which
provides:

Section 11. The Philippine Economic Zone Authority (PEZA) Board. There is
hereby created a body corporate to be known as the Philippine Economic
Zone Authority (PEZA)
The Board shall be composed of the Director General as ex officio chairman
with eight (8) members as follows: the Secretaries or their representatives of
the Department of Trade and Industry, the Department of Finance, the
Department of Labor and Employment, the Department of [the] Interior and
Local Government, the National Economic and Development Authority, and
the Bangko Sentral ng Pilipinas, one (1) representative from the labor sector,
and one (1) representative from the investor/business sector in the
ECOZONE.

Members of the Board shall receive a per diem of not less than the amount
equivalent to the representation and transportation allowances of the
members of the Board and/or as may be determined by the Department of
Budget and Management: Provided, however, That the per diem collected per
month does not exceed the equivalent of four (4) meetings.

As representative of the Secretary of Labor to the PEZA, the petitioner was

receiving a per diem for every board meeting he attended during the years
1995 to 1997.

After a post audit of the PEZAs disbursement transactions, the COA

disallowed the payment of per diems to the petitioner and thus issued the
following:

(a) Notice of Disallowance No. 98-008-101 (95) dated July 31, 1998 for the
total sum of P24,500 covering the period of July-December 1995;

(b) Notice of Disallowance No. 98-003-101 (96) also dated July 31, 1998 for a
total amount of P100,000 covering the period of January 1996 to January
1997;[4]

(c) Notice of Disallowance No. 98-017-101 (97) dated October 9, 1998 for the
total amount of P210,000 covering the period of February 1997 to January
1998.
The uniform reason for the disallowance was stated in the Notices, as follows:

Cabinet members, their deputies and assistants holding other offices in

addition to their primary office and to receive compensation therefore was
declared unconstitutional by the Supreme Court in the Civil Liberties Union
vs. Executive Secretary. Disallowance is in pursuance to COA Memorandum
No. 97-038 dated September 19, 1997 implementing Senate Committee
Report No. 509.[5]

On November 24, 1998, the petitioner filed his motion for reconsideration to
the COA on the following grounds:

1. The Supreme Court in its Resolution dated August 2, 1991 on the motion
for clarification filed by the Solicitor General modified its earlier ruling in the
Civil Liberties Union case which limits the prohibition to Cabinet Secretaries,
Undersecretaries and their Assistants. Officials given the rank equivalent to a
Secretary, Undersecretary or Assistant Secretary and other appointive
officials below the rank of Assistant Secretary are not covered by the
prohibition.

2. Section 11 of R.A. No. 7916 provides the legal basis for the movant to
receive per diem. Said law was enacted in 1995, four years after the Civil
Liberties Union case became final. In expressly authorizing per diems,
Congress should be conclusively presumed to have been aware of the
parameters of the constitutional prohibition as interpreted in the Civil
Liberties Union case.[6]

On January 30, 2001, the COA rendered the assailed decision denying
petitioners motion for reconsideration.

Hence, this petition.

The issue in this case is whether or not the COA correctly disallowed the per
diems received by the petitioner for his attendance in the PEZA Board of
Directors meetings as representative of the Secretary of Labor.

We rule in the affirmative.

The COA anchors the disallowance of per diems in the case of Civil Liberties
Union v. Executive Secretary[7] where the Court declared Executive Order No.
284[8] allowing government officials to hold multiple positions in
government, unconstitutional. Thus, Cabinet Secretaries, Undersecretaries,
and their Assistant Secretaries, are prohibited to hold other government
offices or positions in addition to their primary positions and to receive
compensation therefor, except in cases where the Constitution expressly
provides. The Courts ruling was in conformity with Section 13, Article VII of
the 1987 Constitution which reads:

Sec. 13. The President, Vice-President, the Members of the Cabinet, and their
deputies or assistants shall not, unless otherwise provided in this
Constitution, hold any other office or employment during their tenure. They
shall not, during their tenure, directly or indirectly, practice any other
profession, participate in any business or be financially interested in any
other contract with, or in any franchise, or special privilege granted by the
Government or any subdivision, agency or instrumentality thereof, including
any government-owned or controlled corporations or their subsidiaries. They
shall strictly avoid conflict of interest in the conduct of their office.

The spouse and relatives by consanguinity or affinity within the fourth civil
degree of the President shall not, during his tenure, be appointed as
members of the Constitutional Commissions, or the Office of the
Ombudsman, or as Secretaries, Undersecretaries, Chairmen, or heads of
bureaus or offices, including government-owned or controlled corporations
and subsidiaries.

Pursuant to the Courts ruling in this case and the Senate Committee Report
on the Accountability of Public Officers and Investigations (Blue Ribbon),[9]
the COA issued Memorandum No. 97-038 which authorized the issuance of
the Notices of Disallowances for the per diems received by the petitioner. It
states:
The Commission received a copy of Senate Committee Report No. 509 urging
the Commission on Audit to immediately cause the disallowance of any
payment of any form of additional compensation or remuneration to cabinet
secretaries, their deputies and assistants, or their representatives in violation
of the rule on multiple positions and to effect the refund of any and all such
additional compensation given to and received by the officials concerned, or
their representatives, from the time of the finality of the Supreme Court ruling
in Civil Liberties Union vs. Executive Secretary to the present. In the Civil
Liberties Union case, the Supreme Court ruled that Cabinet Secretaries, their
deputies and assistants may not hold any other office or employment. It
declared Executive Order No. 284 unconstitutional insofar as it allows Cabinet
members, their deputies and assistants to hold other offices in addition to
their primary office and to receive compensation therefor. The said decision
became final and executory on August 19, 1991.

In view thereof, all unit heads/auditors/team leaders of the national

government agencies and government-owned or controlled corporations
which have effected payment of subject allowances are directed to
implement the recommendation contained in the subject Senate Committee
Report by undertaking the following audit action: [10]

The petitioner maintains that he is entitled to the payment of per diems, as

R.A. No. 7916 specifically and categorically provides for the payment of a per
diem for the attendance of the members of the Board of Directors at board
meetings of PEZA. The petitioner contends that this law is presumed to be
valid; unless and until the law is declared unconstitutional, it remains in effect
and binding for all intents and purposes. Neither can this law be rendered
nugatory on the basis of a mere memorandum circular COA Memorandum No.
97-038 issued by the COA. The petitioner stresses that R.A. No. 7916 is a
statute more superior than an administrative directive and the former cannot
just be repealed or amended by the latter.

The petitioner also posits that R.A. No. 7916 was enacted four (4) years after
the case of Civil Liberties Union was promulgated. It is, therefore, assumed
that the legislature, before enacting a law, was aware of the prior holdings of
the courts. Since the constitutionality or the validity of R.A. No. 7916 was
never challenged, the provision on the payment of per diems remains in force
notwithstanding the Civil Liberties Union case. Nonetheless, the petitioners
position as Director IV is not included in the enumeration of officials
prohibited to receive additional compensation as clarified in the Resolution of
the Court dated August 1, 1991; thus, he is still entitled to receive the per
diems.

The petitioners contentions are untenable.

It must be noted that the petitioners presence in the PEZA Board meetings is
solely by virtue of his capacity as representative of the Secretary of Labor. As
the petitioner himself admitted, there was no separate or special
appointment for such position.[11] Since the Secretary of Labor is prohibited
from receiving compensation for his additional office or employment, such
prohibition likewise applies to the petitioner who sat in the Board only in
behalf of the Secretary of Labor.

The petitioners case stands on all fours with the case of Dela Cruz v.
Commission on Audit.[12] Here, the Court upheld the COA in disallowing the
payment of honoraria and per diems to the officers concerned who sat as
members of the Board of Directors of the National Housing Authority. The
officers concerned sat as alternates of their superiors in an ex officio capacity.
Citing also the Civil Liberties Union case, the Court explained thus:

The ex-officio position being actually and in legal contemplation part of the
principal office, it follows that the official concerned has no right to receive
additional compensation for his services in the said position. The reason is
that these services are already paid for and covered by the compensation
attached to his principal office. It should be obvious that if, say, the Secretary
of Finance attends a meeting of the Monetary Board as an ex-officio member
thereof, he is actually and in legal contemplation performing the primary
function of his principal office in defining policy in monetary banking matters,
which come under the jurisdiction of his department. For such attendance,
therefore, he is not entitled to collect any extra compensation, whether it be
in the form of a per diem or an honorarium or an allowance, or some other
such euphemism. By whatever name it is designated, such additional
compensation is prohibited by the Constitution.

Since the Executive Department Secretaries, as ex-officio members of the

NHA Board, are prohibited from receiving extra (additional) compensation,
whether it be in the form of a per diem or an honorarium or an allowance, or
some other such euphemism, it follows that petitioners who sit as their
alternates cannot likewise be entitled to receive such compensation. A
contrary rule would give petitioners a better right than their principals.[13]

Similarly in the case at bar, we cannot allow the petitioner who sat as
representative of the Secretary of Labor in the PEZA Board to have a better
right than his principal. As the representative of the Secretary of Labor, the
petitioner sat in the Board in the same capacity as his principal. Whatever
laws and rules the member in the Board is covered, so is the representative;
and whatever prohibitions or restrictions the member is subjected, the
representative is, likewise, not exempted. Thus, his position as Director IV of
the DOLE which the petitioner claims is not covered by the constitutional
prohibition set by the Civil Liberties Union case is of no moment. The
petitioner attended the board meetings by the authority given to him by the
Secretary of Labor to sit as his representative. If it were not for such
designation, the petitioner would not have been in the Board at all.

There is also no merit in the allegation that the legislature was certainly
aware of the parameters set by the Court when it enacted R.A. No. 7916, four
(4) years after the finality of the Civil Liberties Union case. The payment of
per diems was clearly an express grant in favor of the members of the Board
of Directors which the petitioner is entitled to receive.

It is a basic tenet that any legislative enactment must not be repugnant to

the highest law of the land which is the Constitution. No law can render
nugatory the Constitution because the Constitution is more superior to a
statute.[14] If a law happens to infringe upon or violate the fundamental law,
courts of justice may step in to nullify its effectiveness.[15] It is the task of
the Court to see to it that the law must conform to the Constitution. In the
clarificatory resolution issued by the Court in the Civil Liberties Union case on
August 1, 1991, the Court addressed the issue as to the extent of the
exercise of legislative prerogative, to wit:

The Solicitor General next asks: x x x may the Decision then control or
otherwise encroach on the exclusive competence of the legislature to provide
funds for a public purpose, in terms of compensation or honoraria under
existing laws, where in the absence of such provision said laws would
otherwise meet the terms of the exception by law? Again, the question is
anchored on a misperception. It must be stressed that the so-called exclusive
competence of the legislature to provide funds for a public purpose or to
enact all types of laws, for that matter, is not unlimited. Such competence
must be exercised within the framework of the fundamental law from which
the Legislature draws its power and with which the resulting legislation or
statute must conform. When the Court sets aside legislation for being
violative of the Constitution, it is not thereby substituting its wisdom for that
of the Legislature or encroaching upon the latters prerogative, but again
simply discharging its sacred task of safeguarding and upholding the
paramount law.

The framers of R.A. No. 7916 must have realized the flaw in the law which is
the reason why the law was later amended by R.A. No. 8748[16] to cure such
defect. In particular, Section 11 of R.A. No. 7916 was amended to read:

SECTION 11. The Philippine Economic Zone Authority (PEZA) Board. There is
hereby created a body corporate to be known as the Philippine Economic
Zone Authority (PEZA) attached to the Department of Trade and Industry. The
Board shall have a director general with the rank of department
undersecretary who shall be appointed by the President. The director general
shall be at least forty (40) years of age, of proven probity and integrity, and a
degree holder in any of the following fields: economics, business, public
administration, law, management or their equivalent, and with at least ten
(10) years relevant working experience preferably in the field of management
or public administration.

The director general shall be assisted by three (3) deputy directors general
each for policy and planning, administration and operations, who shall be
appointed by the PEZA Board, upon the recommendation of the director
general. The deputy directors general shall be at least thirty-five (35) years
old, with proven probity and integrity and a degree holder in any of the
following fields: economics, business, public administration, law,
management or their equivalent.

The Board shall be composed of thirteen (13) members as follows: the

Secretary of the Department of Trade and Industry as Chairman, the Director
General of the Philippine Economic Zone Authority as Vice-chairman, the
undersecretaries of the Department of Finance, the Department of Labor and
Employment, the Department of [the] Interior and Local Government, the
Department of Environment and Natural Resources, the Department of
Agriculture, the Department of Public Works and Highways, the Department
of Science and Technology, the Department of Energy, the Deputy Director
General of the National Economic and Development Authority, one (1)
representative from the labor sector, and one (1) representative from the
investors/business sector in the ECOZONE. In case of the unavailability of the
Secretary of the Department of Trade and Industry to attend a particular
board meeting, the Director General of PEZA shall act as Chairman.[17]

As can be gleaned from above, the members of the Board of Directors was
increased from 8 to 13, specifying therein that it is the undersecretaries of
the different Departments who should sit as board members of the PEZA. The
option of designating his representative to the Board by the different Cabinet
Secretaries was deleted. Likewise, the last paragraph as to the payment of
per diems to the members of the Board of Directors was also deleted,
considering that such stipulation was clearly in conflict with the proscription
set by the Constitution.

Prescinding from the above, the petitioner is, indeed, not entitled to receive a
per diem for his attendance at board meetings during his tenure as member
of the Board of Director of the PEZA.

IN LIGHT OF THE FOREGOING, the petition is DISMISSED. The assailed

decision of the COA is AFFIRMED.

SO ORDERED.

EN BANC

BANGKO SENTRAL NG G.R. No. 168964

PILIPINAS,
Petitioner, Present:

Panganiban, C.J.,

Puno,

Quisumbing,

Ynares-Santiago,

Sandoval-Gutierrez,

- versus - Carpio,

Austria-Martinez,

Corona,

Carpio-Morales,

Callejo, Sr.,

Azcuna,

Tinga,

Chico-Nazario, and

Garcia, JJ.

COMMISSION ON AUDIT &

RECARREDO S. VALENZUELA, Promulgated:

Respondents.

January 23, 2006

x ---------------------------------------------------------------------------------------- x

DECISION
YNARES-SANTIAGO, J.:

The instant petition for certiorari seeks to set aside the December 29, 2003
Judgment[1] of the Commission on Audit (COA) in Decision No. 2003-163,
which allowed the release of respondent Recarredo S. Valenzuelas retirement
benefits; as well as its July 21, 2005 Resolution[2] denying petitioner Bangko
Sentral Ng Pilipinas (BSP) motion for reconsideration.

On March 1, 1990, respondent was employed by the defunct Air

Transportation Unit (ATU) of BSPs Security Investigation and Transportation
Department (SITD). As such, he assumed direct accountability over the spare
parts and equipment of BSPs aircrafts.[3] On July 20, 1993, he executed a
certification[4] in his capacity as Administrative Services Officer II/Property
Supply Officer, assuming responsibility over all the properties issued to the
outgoing Chief Aircraft Maintenance Officer/PSO. Upon respondents
retirement on June 30, 1994, however, BSP refused to release his
P291,555.00 retirement benefits for failure to settle his property
accountabilities. According to BSPs Administrative Services Department
(ASD), respondents remaining unaccounted spare parts consist of 1,314
pieces worth P1,007,263.59.[5]

Respondent filed a complaint[6] with the Human Resources Management

Department (HRMD) of BSP against ASD for the banks refusal to release his
retirement benefits, but HRMD denied the same.[7]

On appeal[8] by respondent to the COA, the latter rendered a decision

allowing the release of the retirement benefits. It held that retirement
gratuities cannot be withheld, deducted or applied to the indebtedness of an
employee to the government without his/her consent. The dispositive portion
thereof, reads:

Wherefore, premises considered, the instant claim is given due course and
the payment of the subject amounts to the herein petitioner may now be
allowed without prejudice to any action for recovery of claimants
accountabilities, if warranted.[9]
BSP filed a motion for reconsideration contending that since respondent (1)
assumed responsibility effective September 19, 1992, over all the properties
under the custody of the former Aircraft Maintenance Chief;[10] and (2)
affixed his signature[11] in the list of unaccounted properties,[12] as of
February 28, 1995, he thereby admitted his indebtedness to BSP. Invoking the
case of Villanueva v. Tantuico, Jr.,[13] BSP averred that compensation should
take place between it and respondent since they are both creditors and
debtors in their own right.

On July 21, 2005, the COA denied BSPs motion for reconsideration.[14]
Hence, BSP filed the instant petition.

The issue to be resolved is whether or not BSP may validly withhold

respondents retirement benefits and unilaterally apply the same to his
indebtedness to the government.

The Court rules in the negative.

In Cruz v. Tantuico,[15] it was held that retirement benefits accruing to a

public officer may not, without his consent, be withheld and applied to his
indebtedness to the government. In the said case, the National Treasurer
withheld a portion of the petitioners retirement benefits to answer for losses
arising from her encashment of falsified treasury warrants. In setting aside
the directive of the Treasurer, the Court explained that

x x x no negligence attended the petitioners encashment of the treasury

warrants. Even assuming that she could be held liable for non-compliance
with or violation of some rule or regulation, this Court agrees with the
petitioner that Section 624 of the Revised Administrative Code cannot be
construed to authorize a deduction of the value of the treasury warrants from
her retirement benefits. Said section provides:

Section 624. Retention of salary for satisfaction of indebtedness. When any

person is indebted to the Government of the Philippine Islands (or
Government of the United States), the Insular Auditor may direct the proper
officer to withhold the payment of any money due him or his estate, the
same to be applied in satisfaction of such indebtedness.
The Solicitor General, in his comment, is in agreement with the petitioner that
her retirement pay may not be withheld by administrative fiat to answer for
the shortage incurred while in office [Rollo, p. 99.] This has also been the
interpretation applied by the respondent COA Acting Secretary in similar
cases [Rollo, pp. 62-63.]

That the retirement pay accruing to a public officer may not be withheld and
applied to his indebtedness to the government is settled x x x.

The case of Cruz,[16] citing Hunt v. Hernandez, explained the reason for such
policy in this wise:

x x x we are of the opinion that the exemption should be liberally construed

in favor of the pensioner. Pension in this case is a bounty flowing from the
graciousness of the Government intended to reward past services and, at the
same time, to provide the pensioner with the means with which to support
himself and his family. Unless otherwise clearly provided, the pension should
inure wholly to the benefit of the pensioner x x x.

The above ruling was reiterated in Tantuico, Jr. v. Domingo,[17] and

Government Service Insurance System v. Commission on Audit,[18] where
the Court held that benefits under retirement laws cannot be withheld
regardless of the employees monetary liability to the government. Retirement
laws are liberally interpreted in favor of the retiree because the intention is to
provide for the retirees sustenance and comfort when he is no longer capable
of earning his livelihood.[19]

Moreover, compensation or set off between respondents retirement benefits

and his alleged liability to BSP cannot be allowed under Section 21, Chapter
4, Subtitle-B (Commission on Audit), Book V of the Revised Administrative
Code of 1987, which provides:

Sec. 21. Retention of Money for Satisfaction of Indebtedness to the

Government. When any person is indebted to any government agency, the
Commission may direct the proper officer to withhold the payment of any
money due such person or his estate to be applied in satisfaction of his
indebtedness.

The aforequoted provision originated from Section 624 of the Revised

Administrative Code of 1917. In construing Section 624, the Court held in
Villanueva v. Tantuico, Jr.,[20] that the indebtedness contemplated therein
pertains to one that is acknowledged by the employee or one that is
adjudged by the court. Absent any of these two circumstances, no
compensation under Article 1278 of the Civil Code may be had, thus

While Section 624 of the Revised Administrative Code does indeed authorize
the set-off of a person's indebtedness to the Government against any money
due him or his estate to be applied in satisfaction of such indebtedness, that
indebtedness must be one that is admitted by the alleged debtor or
pronounced by final judgment of a competent court. In such a case, the
person and the Government are in their own right both debtors and creditors
of each other, and compensation takes place by operation of law in
accordance with Article 1278 of the Civil Code. Absent, however, any such
categorical admission by an obligor or final adjudication, no legal
compensation can take place, as this Court has already had occasion to rule
in an early case. Unless admitted by a debtor himself, the conclusion that he
is in truth indebted to the Government cannot be definitely and finally
pronounced by a Government auditor, no matter how convinced he may be
from his examination of the pertinent records of the validity of that
conclusion. Such a declaration, that a government employee or officer is
indeed indebted to the Government, if it is to have binding authority, may
only be made by a court. That determination is after all, plainly a judicial, not
an administrative function. No executive officer or administrative body
possesses such a power.

In the same vein, Section 265 of the Government Accounting and Auditing
Manual explicitly limits the power of COA to retain the retirement benefits of
a government employee for the purpose of satisfying his indebtedness only
to instances where (1) the employee admits his indebtedness and consents
to such retention; or (2) a competent court so directs, thus

Sec. 265. Retention of salary for the satisfaction of indebtedness to the

government. When any person is indebted to the Government of the
Philippines or to any government-owned or controlled corporation or to any
other self-governing board, commission or agency of the government, the
COA may direct the proper officer to withhold the payment of any money due
him or his estate, the same to be applied in satisfaction of such indebtedness
(Sec. 37, PD 1145[21]). However, the retention of the retirement gratuity of a
person to satisfy his indebtedness to the government may be resorted to only
if the person admits his indebtedness and consents to the retention or when
a competent court so directs. (Emphasis supplied)

The COA correctly debunked the averment that respondent admitted his
indebtedness when he issued a certification assuming responsibility over the
properties turned over by the former Aircraft Maintenance Chief.[22] To
warrant the application of set off under Article 1278 of the Civil Code, the
debtors admission of his obligation must be clear and categorical and not one
which merely arise by inference or implication from the customary execution
of official documents in assuming the responsibilities of a predecessor, as in
the instant case. Neither would respondents signature in the list of
unaccounted properties as of February 28, 1995 operate as an
acknowledgement of an obligation. Suffice it to state that said signature
alone hardly satisfies the requisite open and direct recognition of an
obligation that would justify the diminution of retirement benefits. There must
be an independent evidence showing the employees intention to
unmistakably recognize his indebtedness which was never shown in the
present controversy. On the contrary, respondent categorically stated in his
February 9, 1999 letter to the BSP that he never admitted any indebtedness
nor consented to the retention of his benefits by the bank.[23]

Furthermore, even assuming that the February 28, 1995 list of unaccounted
items bearing the signature of respondent can be construed as an admission
of indebtedness, still, said purported admission cannot extend to the alleged
unlocated 1,314 spare parts/furnitures/tools with an acquisition cost of
P1,007,263.59, for which respondent is being held responsible. This is so
because the latter items were never shown to be included in the February 28,
1995 inventory signed by respondent. From the initial 10,120 items with a
total acquisition cost of P47,802,136.82, respondents alleged accountability
was trimmed down to 1,314 spare parts/furnitures/tools with an acquisition
cost of P1,007,263.59.[24] It is doubtful, however, whether the latter items
are included in the February 28, 1995 list inasmuch as BSP never reconciled
these inventories. Hence, the amount allegedly owed by respondent to BSP
are contestable and inconclusive. It cannot thus qualify as a debt for
compensation or set off to be operative under Article 1279[25] of the Civil
Code. At best, said amount is a mere claim that would not make one a
creditor of the other. As explained by the Court in E.G.V. Realty Devt. Corp. v.
Court of Appeals:[26]

Compensation or offset takes place by operation of law when two (2) persons,
in their own right, are creditor and debtor of each other. For compensation to
take place, a distinction must be made between a debt and a mere claim. A
debt is a claim which has been formally passed upon by the highest authority
to which it can in law be submitted and has been declared to be a debt. A
claim, on the other hand, is a debt in embryo. It is mere evidence of a debt
and must pass thru the process prescribed by law before it develops into
what is properly called a debt.

Nevertheless, while the BSP cannot directly proceed against respondents

retirement benefits, it can seek restoration of its claim by means of a proper
court action for its recovery. Verily, there is no prohibition against enforcing a
final monetary judgment against respondents other assets and properties.
[27]

The P291,555.00 retirement gratuity due respondent consists of unused leave

credits (P39,555.00), separation incentive benefits (P112,000.00), and the
amount due under the provident fund (P140,000.00).[28] We find no merit in
BSPs claim that separation incentive benefits cannot be interpreted as part of
respondents retirement benefits. The grant thereof in favor of retirees is
authorized by Republic Act No. 7653 or The New Central Bank Act, in addition
to the existing gratuities enjoyed by the employees. Section 134 thereof
provides:

SEC. 134. Separation Benefits. Pursuant to Section 15 of this Act, the

Monetary Board is authorized to provide separation incentives, and all those
who shall retire or be separated from service on account of reorganization
under the proceeding section shall be entitled to such incentives, which shall
be in addition to all gratuities and benefits to which they may be entitled
under existing laws. (Emphasis added)

As to the provident fund, BSP cannot successfully assert a paramount lien

thereon because the provision invoked by it contemplate of losses arising
from offenses and debts. Section 5, Article IV of the Rules and Regulations
Governing The Bangko Sentral Ng Pilipinas Provident Fund, states:

Section 5 Banks Lien

The Bank shall have a first and paramount lien upon the amount to which the
erring member is entitled as stated in the preceding Section to cover all
losses, costs, and expenses which the Bank may sustain through his
dishonesty, defalcation, theft, embezzlement or falsification and other similar
offenses.

The same lien shall also apply for any amount due to a member to cover any
debt due to the Bank or the Fund.[29]

In the instant case, respondent was neither found guilty of any offense nor
conclusively established to be indebted to BSP. Hence, the latters assertion of
first and paramount lien over the amount due respondent under the
provident fund, must fail.

WHEREFORE, the petition is DENIED. The December 29, 2003 Judgment of the
Commission on Audit in Decision No. 2003-163 which allowed the release of
respondent Recarredo S. Valenzuelas retirement benefits; and its July 21,
2005 Resolution denying petitioner Bangko Sentral Ng Pilipinas motion for
reconsideration are AFFIRMED.

SO ORDERED.