Chuaquico Jett I.
It is alleged that the police power of MMDA
MMDA vs. Bel-Air
FACTS: On December 30, 1995, respondent
received from petitioner, through its
Chairman, a notice dated December 22, 1995
requesting respondent to open Neptune Street
to public vehicular traffic starting January 2,
1996. On the same day the perimeter wall
separating the subdivision of Kalayaan
Avenue would be demolished
On January 2, 1996, respondent instituted
against petitioner before the Regional Trial
Court, Branch 136, Makati City, Civil Case No.
96-001 for injunction. Respondent prayed for
the issuance of a temporary restraining order
and preliminary injunction enjoining the
opening of Neptune Street and prohibiting the
demolition of the perimeter wall. The trial
court issued a temporary restraining order the
following day.
On January 23, 1996, after due hearing, the
trial court denied issuance of a preliminary
injunction.
On January 28, 1997, the appellate court
rendered a Decision on the merits of the case
finding that the MMDA has no authority to
order the opening of Neptune Street, a private
its perimeter walls. It held that the authority is
subdivision road and cause the demolition of
lodged in the City Council of Makati by
ordinance.
ISSUE: W/N MMDA has the authority and
power to subject respondent to make its
private road open for public use
RULING: NO, it does not have the power
Petitioner MMDA claims that it has the
authority to open Neptune Street to public
traffic because it is an agent of the state
endowed with police power in the delivery of
basic services in Metro Manila. One of these
basic services is traffic management which
involves the regulation of the use of
thoroughfares to insure the safety,
convenience and welfare of the general public.
was affirmed by this Court in the consolidated
cases of Sangalang v. Intermediate Appellate
Court.
It bears stressing that police power is lodged
primarily in the National Legislature. It cannot
be exercised by any group or body of
individuals not possessing legislative power.
The National Legislature, however, may
delegate this power to the President and
administrative boards as well as the
lawmaking bodies of municipal corporations
or local government units. Once delegated, the
agents can exercise only such legislative
powers as are conferred on them by the
national lawmaking body.
A local government is a "political subdivision
of a nation or state which is constituted by law
and has substantial control of local affairs."The
Local Government Code of 1991 defines a local
government unit as a "body politic and
corporate" one endowed with powers as a
political subdivision of the National
Government and as a corporate entity
representing the inhabitants of its territory.
Local government units are the provinces,
cities, municipalities and barangays. They are
also the territorial and political subdivisions of
the state.
Our Congress delegated police power to the
local government units in the Local
Government Code of 1991. This delegation is
found in Section 16 of the same Code, known
as the general welfare clause:
"Sec. 16. General Welfare. Every local
government unit shall exercise the powers
expressly granted, those necessarily implied
therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and
effective governance, and those which are
essential to the promotion of the general
welfare. Within their respective territorial
jurisdictions, local government units shall
ensure and support, among other things, the
preservation and enrichment of culture,
promote health and safety, enhance the right
of the people to a balanced ecology, encourage
and support the development of appropriate
and self-reliant scientific and technological
capabilities, improve public morals, enhance
economic prosperity and social justice,
promote full employment among their
residents, maintain peace and order, and
preserve the comfort and convenience of their
inhabitants."
Metropolitan or Metro Manila is a body
composed of several local government units -
i.e., twelve (12) cities and five (5)
municipalities, namely, the cities of Caloocan,
Manila, Mandaluyong, Makati, Pasay, Pasig,
Quezon, Muntinlupa, Las Pinas, Marikina,
Paranaque and Valenzuela, and the
municipalities of Malabon, , Navotas, ,
Pateros, San Juan and Taguig. With the
passage of Republic Act (R. A.) No. 7924[24] in
1995, Metropolitan Manila was declared as a
"special development and administrative
region" and the Administration of "metro-
wide" basic services affecting the region
placed under "a development authority"
referred to as the MMDA.
"Metro-wide services" are those "services
which have metro-wide impact and transcend
local political boundaries or entail huge
expenditures such that it would not be viable
for said services to be provided by the
individual local government units comprising
Metro Manila." There are seven (7) basic
metro-wide services and the scope of these
services cover the following: (1) development
planning; (2) transport and traffic
management; (3) solid waste disposal and
management; (4) flood control and sewerage
management; (5) urban renewal, zoning and
land use planning, and shelter services; (6)
health and sanitation, urban protection and
pollution control; and (7) public safety
Clearly, the scope of the MMDAs function is
limited to the delivery of the seven (7) basic
services. One of these is transport and traffic
management which includes the formulation
and monitoring of policies, standards and
projects to rationalize the existing transport
operations, infrastructure requirements, the
use of thoroughfares and promotion of the
safe movement of persons and goods. It also
covers the mass transport system and the
institution of a system of road regulation, the
administration of all traffic enforcement
operations, traffic engineering services and
traffic education programs, including the
institution of a single ticketing system in
Metro Manila for traffic violations. Under this
service, the MMDA is expressly authorized "to
set the policies concerning traffic" and
"coordinate and regulate the implementation
of all traffic management programs." In
addition, the MMDA may "install and
administer a single ticketing system," fix,
impose and collect fines and penalties for all
traffic violations.
It will be noted that the powers of the MMDA
are limited to the following acts: formulation,
coordination, regulation, implementation,
preparation, management, monitoring, setting
of policies, installation of a system and
administration. There is no syllable in R. A.
No. 7924 that grants the MMDA police power,
let alone legislative power. Even the Metro
Manila Council has not been delegated any
legislative power. Unlike the legislative bodies
of the local government units, there is no
provision in R. A. No. 7924 that empowers the
MMDA or its Council to "enact ordinances,
approve resolutions and appropriate funds for
the general welfare" of the inhabitants of
Metro Manila. The MMDA is, as termed in the
charter itself, a "development authority." It is
an agency created for the purpose of laying
down policies and coordinating with the
various national government agencies, peoples
organizations, non-governmental
organizations and the private sector for the
efficient and expeditious delivery of basic
services in the vast metropolitan area. All its
functions are administrative in nature and
these are actually summed up in the charter
itself
The MMDA shall perform planning,
monitoring and coordinative functions, and in
the process exercise regulatory and
supervisory authority over the delivery of
metro-wide services within Metro Manila,
without diminution of the autonomy of the
local government units concerning purely
local matters."
Contrary to petitioners claim, the two
Sangalang cases do not apply to the case at
bar. Firstly, both involved zoning ordinances
passed by the municipal council of Makati and
the MMC. In the instant case, the basis for the
proposed opening of Neptune Street is
contained in the notice of December 22, 1995
sent by petitioner to respondent BAVA,
through its president. The notice does not cite
any ordinance or law, either by the
Sangguniang Panlungsod of Makati City or by
the MMDA, as the legal basis for the proposed
opening of Neptune Street. Petitioner MMDA
simply relied on its authority under its charter
"to rationalize the use of roads and/or
thoroughfares for the safe and convenient
movement of persons." Rationalizing the use
of roads and thoroughfares is one of the acts
that fall within the scope of transport and
traffic management. By no stretch of the
imagination, however, can this be interpreted
as an express or implied grant of ordinance-
making power, much less police power.
Secondly, the MMDA is not the same entity as
the MMC in Sangalang. Although the MMC is
the forerunner of the present MMDA, an
examination of Presidential Decree (P. D.) No.
824, the charter of the MMC, shows that the
latter possessed greater powers which were
not bestowed on the present MMDA.
"Section 1. Creation of the Metropolitan
Manila.There is hereby created a public
corporation, to be known as the Metropolitan
Manila, vested with powers and attributes of a
corporation including the power to make
contracts, sue and be sued, acquire, purchase,
expropriate, hold, transfer and dispose of
property and such other powers as are
necessary to carry out its purposes. The
Corporation shall be administered by a
Commission created under this Decree."
In 1990, President Aquino issued Executive
Order (E. O.) No. 392 and constituted the
Metropolitan Manila Authority (MMA). The
powers and functions of the MMC were
devolved to the MMA. It ought to be stressed,
however, that not all powers and functions of
the MMC were passed to the MMA. The
MMAs power was limited to the "delivery of
basic urban services requiring coordination in
Metropolitan Manila." The MMAs governing
body, the Metropolitan Manila Council,
although composed of the mayors of the
component cities and municipalities, was
merely given the power of: (1) formulation of
policies on the delivery of basic services
requiring coordination and consolidation; and
(2) promulgation of resolutions and other
issuances, approval of a code of basic services
and the exercise of its rule-making power.
Under the 1987 Constitution, the local
government units became primarily
responsible for the governance of their
respective political subdivisions. The MMAs
jurisdiction was limited to addressing
common problems involving basic services
that transcended local boundaries. It did not
have legislative power. Its power was merely
to provide the local government units
technical assistance in the preparation of local
development plans. Any semblance of
legislative power it had was confined to a
"review [of] legislation proposed by the local
legislative assemblies to ensure consistency
among local governments and with the
comprehensive development plan of Metro
Manila," and to "advise the local governments
accordingly."
When R.A. No. 7924 took effect, Metropolitan
Manila became a "special development and
administrative region" and the MMDA a
"special development authority" whose
functions were "without prejudice to the
autonomy of the affected local government
units." The character of the MMDA was clearly
defined in the legislative debates enacting its
charter.
Clearly, the MMDA is not a political unit of
government. The power delegated to the
MMDA is that given to the Metro Manila
Council to promulgate administrative rules
and regulations in the implementation of the
MMDAs functions. There is no grant of
authority to enact ordinances and regulations
for the general welfare of the inhabitants of the
metropolis.
It is thus beyond doubt that the MMDA is not
a local government unit or a public
corporation endowed with legislative power.
It is not even a "special metropolitan political
subdivision" as contemplated in Section 11,
Article X of the Constitution. The creation of a
"special metropolitan political subdivision"
requires the approval by a majority of the
votes cast in a plebiscite in the political units
directly affected. R. A. No. 7924 was not
submitted to the inhabitants of Metro Manila
in a plebiscite. The Chairman of the MMDA is
not an official elected by the people, but
appointed by the President with the rank and
privileges of a cabinet member. In fact, part of
his function is to perform such other duties as
may be assigned to him by the President,
whereas in local government units, the
President merely exercises supervisory
authority. This emphasizes the administrative
character of the MMDA.
Clearly then, the MMC under P. D. No. 824 is
not the same entity as the MMDA under R. A.
No. 7924. Unlike the MMC, the MMDA has no
power to enact ordinances for the welfare of
the community. It is the local government
units, acting through their respective
legislative councils, that possess legislative
power and police power. In the case at bar, the
Sangguniang Panlungsod of Makati City did
not pass any ordinance or resolution ordering
the opening of Neptune Street, hence, its
proposed opening by petitioner MMDA is
illegal and the respondent Court of Appeals
did not err in so ruling. We desist from ruling
on the other issues as they are unnecessary.
MMDA vs. Garin
FACTS: Dante O. Garin, a lawyer, who was
issued a traffic violation receipt (TVR) and his
drivers license confiscated for parking illegally
along Gandara Street, Binondo, Manila, on 05
August 1995. The following statements were
printed on the TVR
Shortly before the expiration of the TVRs
validity, the respondent addressed a letter to
then MMDA Chairman Prospero Oreta
requesting the return of his drivers license,
and expressing his preference for his case to be
filed in court.
He filed a case on the grounds that n the
absence of any implementing rules and
regulations, Sec. 5(f) of Rep. Act No. 7924
grants the MMDA unbridled discretion to
deprive erring motorists of their licenses, pre-
empting a judicial determination of the
validity of the deprivation, thereby violating
the due process clause of the Constitution. The
respondent further contended that the
provision violates the constitutional
prohibition against undue delegation of
legislative authority, allowing as it does the
MMDA to fix and impose unspecified and
therefore unlimited - fines and other penalties
on erring motorists.
For its part, the MMDA, represented by the
Office of the Solicitor General, pointed out that
the powers granted to it by Sec. 5(f) of Rep.
Act No. 7924 are limited to the fixing,
collection and imposition of fines and
penalties for traffic violations, which powers
are legislative and executive in nature; the
judiciary retains the right to determine the
validity of the penalty imposed.
RTC granted in favour of respondent.
ISSUE: W/N MMDA has the power to
confiscate, revoke or suspend drivers license
under its charter
RULING: NO, it does not have the power,
following MMDA vs. Bel-air doctrine
The petitioner correctly points out that a
license to operate a motor vehicle is not a
property right, but a privilege granted by the
state, which may be suspended or revoked by
the state in the exercise of its police power, in
the interest of the public safety and welfare,
subject to the procedural due process
requirements.
Foreign jurisprudence cited by petitioner
points out that the legislative power to
regulate travel over the highways and
thoroughfares of the state for the general
welfare is extensive. It may be exercised in any
reasonable manner to conserve the safety of
travelers and pedestrians. Since motor vehicles
are instruments of potential danger, their
registration and the licensing of their
operators have been required almost from
their first appearance. The right to operate
them in public places is not a natural and
unrestrained right, but a privilege subject to
reasonable regulation, under the police power,
in the interest of the public safety and welfare.
The power to license imports further power to
withhold or to revoke such license upon
noncompliance with prescribed conditions.
The said case also involved the herein
petitioner MMDA which claimed that it had
the authority to open a subdivision street
owned by the Bel-Air Village Association, Inc.
to public traffic because it is an agent of the
state endowed with police power in the
delivery of basic services in Metro Manila.
From this premise, the MMDA argued that
there was no need for the City of Makati to
enact an ordinance opening Neptune Street to
the public.
Tracing the legislative history of Rep. Act No.
7924 creating the MMDA, we concluded that
the MMDA is not a local government unit or a
public corporation endowed with legislative
power, and, unlike its predecessor, the Metro
Manila Commission, it has no power to enact
ordinances for the welfare of the community.
Thus, in the absence of an ordinance from the
City of Makati, its own order to open the street
was invalid.
We restate here the doctrine in the said
decision as it applies to the case at bar: police
power, as an inherent attribute of sovereignty,
is the power vested by the Constitution in the
legislature to make, ordain, and establish all
manner of wholesome and reasonable laws,
statutes and ordinances, either with penalties
or without, not repugnant to the Constitution,
as they shall judge to be for the good and
welfare of the commonwealth, and for the
subjects of the same.
Having been lodged primarily in the National
Legislature, it cannot be exercised by any
group or body of individuals not possessing
legislative power. The National Legislature,
however, may delegate this power to the
president and administrative boards as well as
the lawmaking bodies of municipal
corporations or local government units
(LGUs). Once delegated, the agents can
exercise only such legislative powers as are
conferred on them by the national lawmaking
body.
Therefore, insofar as Sec. 5(f) of Rep. Act No.
7924 is understood by the lower court and by
the petitioner to grant the MMDA the power
to confiscate and suspend or revoke drivers
licenses without need of any other legislative
enactment, such is an unauthorized exercise of
police power.
Section 5 of Rep. Act No. 7924 enumerates the
Functions and Powers of the Metro Manila
Development Authority. The contested clause
in Sec. 5(f) states that the petitioner shall
install and administer a single ticketing
system, fix, impose and collect fines and
penalties for all kinds of violations of traffic
rules and regulations, whether moving or
nonmoving in nature, and confiscate and
suspend or revoke drivers licenses in the
enforcement of such traffic laws and
regulations, the provisions of Rep. Act No.
4136[18] and P.D. No. 1605[19] to the contrary
notwithstanding, and that (f)or this purpose,
the Authority shall enforce all traffic laws and
regulations in Metro Manila, through its traffic
operation center, and may deputize members
of the PNP, traffic enforcers of local
government units, duly licensed security
guards, or members of non-governmental
organizations to whom may be delegated
certain authority, subject to such conditions
and requirements as the Authority may
impose.
Thus, where there is a traffic law or regulation
validly enacted by the legislature or those
agencies to whom legislative powers have
been delegated (the City of Manila in this
case), the petitioner is not precluded and in
fact is duty-bound to confiscate and suspend
or revoke drivers licenses in the exercise of its
mandate of transport and traffic management,
as well as the administration and
implementation of all traffic enforcement
operations, traffic engineering services and
traffic education programs.
This is consistent with our ruling in Bel-Air
that the MMDA is a development authority
created for the purpose of laying down
policies and coordinating with the various
national government agencies, peoples
organizations, non-governmental
organizations and the private sector, which
may enforce, but not enact, ordinances.
MMDA vs. Trackworks Rail Transit
FACTS: In 1997, the Government, through the
Department of Transportation and
Communications, entered into a build-lease-
transfer agreement (BLT agreement) with
Metro Rail Transit Corporation, Limited
(MRTC) pursuant to Republic Act No. 6957
(Build, Operate and Transfer Law), under
which MRTC undertook to build MRT3
subject to the condition that MRTC would
own MRT3 for 25 years, upon the expiration of
which the ownership would transfer to the
Government.
In 1998, respondent Trackworks Rail Transit
Advertising, Vending & Promotions, Inc.
(Trackworks) entered into a contract for
advertising services with MRTC. Trackworks
thereafter installed commercial billboards,
signages and other advertizing media in the
different parts of the MRT3. In 2001, however,
MMDA requested Trackworks to dismantle
the billboards, signages and other advertizing
media pursuant to MMDA Regulation No. 96-
009, whereby MMDA prohibited the posting,
installation and display of any kind or form of
billboards, signs, posters, streamers, in any
part of the road, sidewalk, center island, posts,
trees, parks and open space. After Trackworks
refused the request of MMDA, MMDA
proceeded to dismantle the formers billboards
and similar forms of advertisement.
On March 6, 2002, the RTC (Branch 155) issued
a TRO, enjoining MMDA from dismantling or
destroying Trackworks billboards, signages
and other advertizing media. On March 25,
2002, the RTC issued a writ of preliminary
injunction for the same purpose and affirmed
by CA.
ISSUE: W/N MMDA has the power
RULING: NO, it does not have power
because MRTC has ownership under the
BLT Agreement
MMDA avers that the conversion of the center
island of Epifanio Delos Santos Avenue
(EDSA) into the carriageway of the MRT3 line
did not exempt the EDSA center island from
the coverage of the MMDA regulation; that the
Governments grant of development rights to
MRTC was not an abdication of its right to
regulate, and, therefore, the development of
the MRT3 remained subject to all existing and
applicable national and local laws, ordinances,
rules and regulations; that MMDA was merely
implementing existing and applicable laws;
that Trackworks advertising materials were
placed indiscriminately and without due
regard to safety, and as such might be
classified as obstructions and distractions to
the motorists traversing EDSA; and that the
interests of a few should not prevail over the
good of the greater number in the community
whose safety and general welfare MMDA was
mandated to protect.
That Trackworks derived its right to install its
billboards, signages and other advertizing
media in the MRT3 from MRTCs authority
under the BLT agreement to develop
commercial premises in the MRT3 structure or
to obtain advertising income therefrom is no
longer debatable. Under the BLT agreement,
indeed, MRTC owned the MRT3 for 25 years,
upon the expiration of which MRTC would
transfer ownership of the MRT3 to the
Government.
Considering that MRTC remained to be the
owner of the MRT3 during the time material
to this case, and until this date, MRTCs
entering into the contract for advertising
services with Trackworks was a valid exercise
of ownership by the former. In fact, in
Metropolitan Manila Development Authority
v. Trackworks Rail Transit Advertising,
Vending & Promotions, Inc., this Court
expressly recognized Trackworks right to
install the billboards, signages and other
advertising media pursuant to said contract.
The latters right should, therefore, be
respected.
It is futile for MMDA to simply invoke its legal
mandate to justify the dismantling of
Trackworks billboards, signages and other
advertising media. MMDA simply had no
power on its own to dismantle, remove, or
destroy the billboards, signages and other
advertising media installed on the MRT3
structure by Trackworks.
The Court also agrees with the CAs ruling that
MMDA Regulation No. 96-009 and MMC
Memorandum Circular No. 88-09 did not
apply to Trackworks billboards, signages and
other advertising media. The prohibition
against posting, installation and display of
billboards, signages and other advertising
media applied only to public areas, but MRT3,
being private property pursuant to the BLT
agreement between the Government and
MRTC, was not one of the areas as to which
the prohibition applied. Moreover, MMC
Memorandum Circular No. 88-09 did not
apply to Trackworks billboards, signages and
other advertising media in MRT3, because it
did not specifically cover MRT3, and because
it was issued a year prior to the construction of
MRT3 on the center island of EDSA. Clearly,
MMC Memorandum Circular No. 88-09 could
not have included MRT3 in its prohibition.
MMDAs insistence that it was only
implementing Presidential Decree No. 1096
(Building Code) and its implementing rules
and regulations is not persuasive. The power
to enforce the provisions of the Building Code
was lodged in the Department of Public
Works and Highways (DPWH), not in
MMDA.
MMDA vs. Concerned Residents of Manila
Bay (2008)
FACTS: This case started when, on January 29,
1999, respondents Concerned Residents of
Manila Bay filed a complaint before the
Regional Trial Court (RTC) in Imus, Cavite
against several government agencies, among
them the petitioners, for the cleanup,
rehabilitation, and protection of the Manila
Bay.
Rebecca de Vera, for Metropolitan
Waterworks and Sewerage System (MWSS)
and in behalf of other petitioners, testified
about the MWSS efforts to reduce pollution
along the Manila Bay through the Manila
Second Sewerage Project. For its part, the
Philippine Ports Authority (PPA) presented, as
part of its evidence, its memorandum circulars
on the study being conducted on ship-
generated waste treatment and disposal, and
its Linis Dagat (Clean the Ocean) project for
the cleaning of wastes accumulated or washed
to shore.
RTC ordered the petitioners to rehabilitate
Manila Bay which was sustained by CA.
ISSUE: W/N petitioners can be compelled to
clean and rehabilitate Manila Bay
RULING: YES, they can be compelled
through mandamus
Generally, the writ of mandamus lies to
require the execution of a ministerial duty. A
ministerial duty is one that requires neither
the exercise of official discretion nor judgment.
It connotes an act in which nothing is left to
the discretion of the person executing it. It is a
simple, definite duty arising under conditions
admitted or proved to exist and imposed by
law. Mandamus is available to compel action,
when refused, on matters involving discretion,
but not to direct the exercise of judgment or
discretion one way or the other.
Respondents, on the other hand, counter that
the statutory command is clear and that
petitioners duty to comply with and act
according to the clear mandate of the law does
not require the exercise of discretion.
According to respondents, petitioners, the
MMDA in particular, are without discretion,
for example, to choose which bodies of water
they are to clean up, or which discharge or
spill they are to contain. By the same token,
respondents maintain that petitioners are
bereft of discretion on whether or not to
alleviate the problem of solid and liquid waste
disposal; in other words, it is the MMDAs
ministerial duty to attend to such services.
First off, we wish to state that petitioners
obligation to perform their duties as defined
by law, on one hand, and how they are to
carry out such duties, on the other, are two
different concepts. While the implementation
of the MMDAs mandated tasks may entail a
decision-making process, the enforcement of
the law or the very act of doing what the law
exacts to be done is ministerial in nature and
may be compelled by mandamus.
The MMDA is duty-bound to comply with
Sec. 41 of the Ecological Solid Waste
Management Act (RA 9003) which prescribes
the minimum criteria for the establishment of
sanitary landfills and Sec. 42 which provides
the minimum operating requirements that
each site operator shall maintain in the
operation of a sanitary landfill.
Complementing Sec. 41 are Secs. 36 and 37 of
RA 9003, enjoining the MMDA and local
government units, among others, after the
effectivity of the law on February 15, 2001,
from using and operating open dumps for
solid waste and disallowing, five years after
such effectivity, the use of controlled dumps.
The MMDAs duty in the area of solid waste
disposal, as may be noted, is set forth not only
in the Environment Code (PD 1152) and RA
9003, but in its charter as well. This duty of
putting up a proper waste disposal system
cannot be characterized as discretionary, for,
as earlier stated, discretion presupposes the
power or right given by law to public
functionaries to act officially according to their
judgment or conscience. A discretionary duty
is one that allows a person to exercise
judgment and choose to perform or not to
perform. Any suggestion that the MMDA has
the option whether or not to perform its solid
waste disposal-related duties ought to be
dismissed for want of legal basis.
A perusal of other petitioners respective
charters or like enabling statutes and pertinent
laws would yield this conclusion: these
government agencies are enjoined, as a matter
of statutory obligation, to perform certain
functions relating directly or indirectly to the
cleanup, rehabilitation, protection, and
preservation of the Manila Bay. They are
precluded from choosing not to perform these
duties.
In Metro Manila, however, the MMDA is
authorized by Sec. 3(d), RA 7924 to perform
metro-wide services relating to flood control
and sewerage management which include the
formulation and implementation of policies,
standards, programs and projects for an
integrated flood control, drainage and
sewerage system.
On July 9, 2002, a Memorandum of Agreement
was entered into between the DPWH and
MMDA, whereby MMDA was made the
agency primarily responsible for flood control
in Metro Manila. For the rest of the country,
DPWH shall remain as the implementing
agency for flood control services. The mandate
of the MMDA and DPWH on flood control
and drainage services shall include the
removal of structures, constructions, and
encroachments built along rivers, waterways,
and esteros (drainages) in violation of RA
7279, PD 1067, and other pertinent laws.
The MMDA, as lead agency, in coordination
with the DPWH, LGUs, and concerned
agencies, can dismantle and remove all
structures, constructions, and other
encroachments built in breach of RA 7279 and
other pertinent laws along the rivers,
waterways, and esteros in Metro Manila. With
respect to rivers, waterways, and esteros in
Bulacan, Bataan, Pampanga, Cavite, and
Laguna that discharge wastewater directly or
eventually into the Manila Bay, the DILG shall
direct the concerned LGUs to implement the
demolition and removal of such structures,
constructions, and other encroachments built
in violation of RA 7279 and other applicable
laws in coordination with the DPWH and
concerned agencies.
Respondents are correct. For one thing, said
Sec. 17 does not in any way state that the
government agencies concerned ought to
confine themselves to the containment,
removal, and cleaning operations when a
specific pollution incident occurs. On the
contrary, Sec. 17 requires them to act even in
the absence of a specific pollution incident, as
long as water quality has deteriorated to a
degree where its state will adversely affect its
best usage. This section, to stress, commands
concerned government agencies, when
appropriate, to take such measures as may be
necessary to meet the prescribed water quality
standards. In fine, the underlying duty to
upgrade the quality of water is not conditional
on the occurrence of any pollution incident.
For another, a perusal of Sec. 20 of the
Environment Code, as couched, indicates that
it is properly applicable to a specific situation
in which the pollution is caused by polluters
who fail to clean up the mess they left behind.
In such instance, the concerned government
agencies shall undertake the cleanup work for
the polluters account. Petitioners assertion,
that they have to perform cleanup operations
in the Manila Bay only when there is a water
pollution incident and the erring polluters do
not undertake the containment, removal, and
cleanup operations, is quite off mark. As
earlier discussed, the complementary Sec. 17
of the Environment Code comes into play and
the specific duties of the agencies to clean up
come in even if there are no pollution
incidents staring at them. Petitioners, thus,
cannot plausibly invoke and hide behind Sec.
20 of PD 1152 or Sec. 16 of RA 9275 on the
pretext that their cleanup mandate depends on
the happening of a specific pollution incident.
In this regard, what the CA said with respect
to the impasse over Secs. 17 and 20 of PD 1152
is at once valid as it is practical. The appellate
court wrote: PD 1152 aims to introduce a
comprehensive program of environmental
protection and management. This is better
served by making Secs. 17 & 20 of general
application rather than limiting them to
specific pollution incidents.
MMDA vs. Concerned Residents of Manila
Bay (2011)
The case is now in the execution phase of the
final and executory December 18, 2008
Decision. The Manila Bay Advisory
Committee was created to receive and
evaluate the quarterly progressive reports on
the activities undertaken by the agencies in
accordance with said decision and to monitor
the execution phase.
In the absence of specific completion periods,
the Committee recommended that time frames
be set for the agencies to perform their
assigned tasks. This may be viewed as an
encroachment over the powers and functions
of the Executive Branch headed by the
President of the Philippines.
The issuance of subsequent resolutions by the
Court is simply an exercise of judicial power
under Art. VIII of the Constitution, because
the execution of the Decision is but an integral
part of the adjudicative function of the Court.
None of the agencies ever questioned the
power of the Court to implement the
December 18, 2008 Decision nor has any of
them raised the alleged encroachment by the
Court over executive functions.
While additional activities are required of the
agencies like submission of plans of action,
data or status reports, these directives are but
part and parcel of the execution stage of a final
decision under Rule 39 of the Rules of Court.
Section 47.
It is clear that the final judgment includes not
only what appears upon its face to have been
so adjudged but also those matters actually
and necessarily included therein or necessary
thereto. Certainly, any activity that is needed
to fully implement a final judgment is
necessarily encompassed by said judgment.
Moreover, the submission of periodic reports
is sanctioned by Secs. 7 and 8, Rule 8 of the
Rules of Procedure for Environmental cases:
Sec. 7. Judgment.If warranted, the court shall
grant the privilege of the writ of continuing
mandamus requiring respondent to perform
an act or series of acts until the judgment is
fully satisfied and to grant such other reliefs as
may be warranted resulting from the wrongful
or illegal acts of the respondent. The court
shall require the respondent to submit
periodic reports detailing the progress and
execution of the judgment, and the court may,
by itself or through a commissioner or the
appropriate government agency, evaluate and
monitor compliance. The petitioner may
submit its comments or observations on the
execution of the judgment.
With the final and executory judgment in
MMDA, the writ of continuing mandamus
issued in MMDA means that until petitioner-
agencies have shown full compliance with the
Courts orders, the Court exercises continuing
jurisdiction over them until full execution of
the judgment.
On or before June 30, 2011, the Department of
the Interior and Local Government (DILG)
shall order the Mayors of all cities in Metro
Manila; the Governors of Rizal, Laguna,
Cavite, Bulacan, Pampanga and Bataan; and
the Mayors of all the cities and towns in said
provinces to inspect all factories, commercial
establishments and private homes along the
banks of the major river systemssuch as but
not limited to the Pasig-Marikina-San Juan
Rivers, the National Capital Region
(Paranaque-Zapote, Las Pinas) Rivers, the
Navotas-Malabon-Tullahan-Tenejeros Rivers,
the Meycauayan-Marilao-Obando (Bulacan)
Rivers, the Talisay (Bataan) River, the Imus
(Cavite) River, and the Laguna De Bayand
other minor rivers and waterways within their
jurisdiction that eventually discharge water
into the Manila Bay and the lands abutting it,
to determine if they have wastewater
treatment facilities and/or hygienic septic
tanks, as prescribed by existing laws,
ordinances, rules and regulations. Said local
government unit (LGU) officials are given up
to September 30, 2011 to finish the inspection
of said establishments and houses.
In case of non-compliance, the LGU officials
shall take appropriate action to ensure
compliance by non-complying factories,
commercial establishments and private homes
with said law, rules and regulations requiring
the construction or installment of wastewater
treatment facilities or hygienic septic tanks.
The aforementioned governors and mayors
shall submit to the DILG on or before
December 31, 2011 their respective compliance
reports which will contain the names and
addresses or offices of the owners of all the
non-complying factories, commercial
establishments and private homes, copy
furnished the concerned environmental
agency, be it the local DENR office or the
Laguna Lake Development Authority.
The DILG is required to submit a five-year
plan of action that will contain measures
intended to ensure compliance of all non-
complying factories, commercial
establishments, and private homes.
On or before June 30, 2011, the DILG and the
mayors of all cities in Metro Manila shall
consider providing land for the wastewater
facilities of the Metropolitan Waterworks and
Sewerage System (MWSS) or its
concessionaires (Maynilad and Manila Water,
Inc.) within their respective jurisdictions.
The Metropolitan Manila Development
Authority (MMDA) shall submit to the Court
on or before June 30, 2011 the names and
addresses of the informal settlers in Metro
Manila who, as of December 31, 2010, own and
occupy houses, structures, constructions and
other encroachments established or built along
the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the
Navotas-Malabon-Tullahan-Tenejeros Rivers,
and connecting waterways and esteros, in
violation of RA 7279 and other applicable
laws. On or before June 30, 2011, the MMDA
shall submit its plan for the removal of said
informal settlers and the demolition of the
aforesaid houses, structures, constructions and
encroachments, as well as the completion
dates for said activities, which shall be fully
implemented not later than December 31,
2015.
The MMDA is ordered to submit a status
report, within thirty (30) days from receipt of
this Resolution, on the establishment of a
sanitary landfill facility for Metro Manila in
compliance with the standards under RA 9003
or the Ecological Solid Waste Management
Act.
On or before June 30, 2011, the MMDA shall
submit a report of the location of open and
controlled dumps in Metro Manila whose
operations are illegal after February 21, 2006,
[3] pursuant to Secs. 36 and 37 of RA 9003, and
its plan for the closure of these open and
controlled dumps to be accomplished not later
than December 31, 2012. Also, on or before
June 30, 2011, the DENR Secretary, as
Chairperson of the National Solid Waste
Management Commission (NSWMC), shall
submit a report on the location of all open and
controlled dumps in Rizal, Cavite, Laguna,
Bulacan, Pampanga and Bataan.
On or before June 30, 2011, the MMDA and the
seventeen (17) LGUs in Metro Manila are
ordered to jointly submit a report on the
average amount of garbage collected monthly
per district in all the cities in Metro Manila
from January 2009 up to December 31, 2010
vis--vis the average amount of garbage
disposed monthly in landfills and dumpsites.
In its quarterly report for the last quarter of
2010 and thereafter, MMDA shall report on
the apprehensions for violations of the penal
provisions of RA 9003, RA 9275 and other laws
on pollution for the said period.
MMDA vs. Viron Transportation Co.
FACTS: The present petition for review on
certiorari, rooted in the traffic congestion
problem, questions the authority of the
Metropolitan Manila Development Authority
(MMDA) to order the closure of provincial bus
terminals along Epifanio de los Santos Avenue
(EDSA) and major thoroughfares of Metro
Manila.
As the above-quoted portions of the E.O.
noted, the primary cause of traffic congestion
in Metro Manila has been the numerous buses
plying the streets and the inefficient
connectivity of the different transport modes;
[5] and the MMDA had recommended a plan
to decongest traffic by eliminating the bus
terminals now located along major Metro
Manila thoroughfares and providing more and
convenient access to the mass transport
system to the commuting public through the
provision of mass transport terminal facilities
which plan is referred to under the E.O. as the
Greater Manila Mass Transport System Project
(the Project).
Pursuant to the E.O., the Metro Manila
Council (MMC), the governing board and
policymaking body of the MMDA, issued
Resolution No. 03-07 series of 2003 expressing
full support of the Project. Recognizing the
imperative to integrate the different transport
modes via the establishment of common bus
parking terminal areas, the MMC cited the
need to remove the bus terminals located
along major thoroughfares of Metro Manila.
the trial court sustained the constitutionality
and legality of the E.O. pursuant to R.A. No.
7924, which empowered the MMDA to
administer Metro Manilas basic services
including those of transport and traffic
management.
The trial court held that the E.O. was a valid
exercise of the police power of the State as it
satisfied the two tests of lawful subject matter
and lawful means, hence, Virons and
Mencorps property rights must yield to police
power.
On the separate motions for reconsideration of
Viron and Mencorp, the trial court, by Order
of September 8, 2005, reversed its Decision,
this time holding that the E.O. was an
unreasonable exercise of police power; that the
authority of the MMDA under Section (5)(e) of
R.A. No. 7924 does not include the power to
order the closure of Virons and Mencorps
existing bus terminals; and that the E.O. is
inconsistent with the provisions of the Public
Service Act.
ISSUE: W/N MMDA has the power to
terminate provincial bus operation travelling
at Metro Manila
RULING: NO, it does not have any power
It cannot be gainsaid that the E.O. would have
an adverse effect on respondents. The closure
of their bus terminals would mean, among
other things, the loss of income from the
operation and/or rentals of stalls thereat.
Precisely, respondents claim a deprivation of
their constitutional right to property without
due process of law.
Respondents have thus amply demonstrated a
personal and substantial interest in the case
such that [they have] sustained, or will
sustain, direct injury as a result of [the E.O.s]
enforcement. Consequently, the established
rule that the constitutionality of a law or
administrative issuance can be challenged by
one who will sustain a direct injury as a result
of its enforcement has been satisfied by
respondents.
It is readily apparent from the abovequoted
provisions of E.O. No. 125, as amended, that
the President, then possessed of and exercising
legislative powers, mandated the DOTC to be
the primary policy, planning, programming,
coordinating, implementing, regulating and
administrative entity to promote, develop and
regulate networks of transportation and
communications. The grant of authority to the
DOTC includes the power to establish and
administer comprehensive and integrated
programs for transportation and
communications.
As may be seen further, the Minister (now
Secretary) of the DOTC is vested with the
authority and responsibility to exercise the
mandate given to the department.
Accordingly, the DOTC Secretary is
authorized to issue such orders, rules,
regulations and other issuances as may be
necessary to ensure the effective
implementation of the law.
Since, under the law, the DOTC is authorized
to establish and administer programs and
projects for transportation, it follows that the
President may exercise the same power and
authority to order the implementation of the
Project, which admittedly is one for
transportation.
Thus, whenever a specific function is
entrusted by law or regulation to a
subordinate, the President may act directly or
merely direct the performance of a duty.
Respecting the Presidents authority to order
the implementation of the Project in the
exercise of the police power of the State,
suffice it to stress that the powers vested in the
DOTC Secretary to establish and administer
comprehensive and integrated programs for
transportation and communications and to
issue orders, rules and regulations to
implement such mandate (which, as
previously discussed, may also be exercised
by the President) have been so delegated for
the good and welfare of the people. Hence,
these powers partake of the nature of police
power.
It bears stressing that under the provisions of
E.O. No. 125, as amended, it is the DOTC, and
not the MMDA, which is authorized to
establish and implement a project such as the
one subject of the cases at bar. Thus, the
President, although authorized to establish or
cause the implementation of the Project, must
exercise the authority through the
instrumentality of the DOTC which, by law, is
the primary implementing and administrative
entity in the promotion, development and
regulation of networks of transportation, and
the one so authorized to establish and
implement a project such as the Project in
question.
By designating the MMDA as the
implementing agency of the Project, the
President clearly overstepped the limits of the
authority conferred by law, rendering E.O. No.
179 ultra vires.
Clearly, the scope of the MMDAs function is
limited to the delivery of the seven (7) basic
services. One of these is transport and traffic
management which includes the formulation
and monitoring of policies, standards and
projects to rationalize the existing transport
operations, infrastructure requirements, the
use of thoroughfares and promotion of the
safe movement of persons and goods. It also
covers the mass transport system and the
institution of a system of road regulation, the
administration of all traffic enforcement
operations, traffic engineering services and
traffic education programs, including the
institution of a single ticketing system in
Metro Manila for traffic violations. Under this
service, the MMDA is expressly authorized to
to set the policies concerning traffic and
coordinate and regulate the implementation of
all traffic management programs. In addition,
the MMDA may install and administer a
single ticketing system, fix, impose and collect
fines and penalties for all traffic violations.
It will be noted that the powers of the MMDA
are limited to the following acts: formulation,
coordination, regulation, implementation,
preparation, management, monitoring, setting
of policies, installation of a system and
administration. There is no syllable in R.A.
No. 7924 that grants the MMDA police power,
let alone legislative power. Even the Metro
Manila Council has not been delegated any
legislative power. Unlike the legislative bodies
of the local government units, there is no
provision in R.A. No. 7924 that empowers the
MMDA or its Council to enact ordinances,
approve resolutions and appropriate funds for
the general welfare of the inhabitants of Metro
Manila. The MMDA is, as termed in the
charter itself, a development authority. It is an
agency created for the purpose of laying down
policies and coordinating with the various
national government agencies, peoples
organizations, non-governmental
organizations and the private sector for the
efficient and expeditious delivery of basic
services in the vast metropolitan area. All its
functions are administrative in nature and
these are actually summed up in the charter
itself, viz:
SECTION 2. Creation of the Metropolitan
Manila Development Authority. . . .
The MMDA shall perform planning,
monitoring and coordinative functions, and in
the process exercise regulatory and
supervisory authority over the delivery of
metro-wide services within Metro Manila,
without diminution of the autonomy of the
local government units concerning purely
local matters.
In light of the administrative nature of its
powers and functions, the MMDA is devoid of
authority to implement the Project as
envisioned by the E.O; hence, it could not have
been validly designated by the President to
undertake the Project. It follows that the
MMDA cannot validly order the elimination
of respondents terminals.
Even then, for reasons which bear reiteration,
the MMDA cannot order the closure of
respondents terminals not only because no
authority to implement the Project has been
granted nor legislative or police power been
delegated to it, but also because the
elimination of the terminals does not satisfy
the standards of a valid police power measure.
This Court commiserates with the MMDA for
the roadblocks thrown in the way of its efforts
at solving the pestering problem of traffic
congestion in Metro Manila. These efforts are
commendable, to say the least, in the face of
the abominable traffic situation of our roads
day in and day out. This Court can only
interpret, not change, the law, however. It
needs only to be reiterated that it is the DOTC
as the primary policy, planning,
programming, coordinating, implementing,
regulating and administrative entity to
promote, develop and regulate networks of
transportation and communications which
has the power to establish and administer a
transportation project like the Project subject
of the case at bar.
Francisco Jr. vs. Fernando
FACTS: Petitioner Ernesto B. Francisco, Jr.
(petitioner), as member of the Integrated Bar
of the Philippines and taxpayer, filed this
original action for the issuance of the writs of
Prohibition and Mandamus. Petitioner prays
for the Prohibition writ to enjoin respondents
Bayani F. Fernando, Chairman of the
Metropolitan Manila Development Authority
(MMDA) and the MMDA (respondents) from
further implementing its wet flag scheme (Flag
Scheme).
Petitioner contends that the Flag Scheme: (1)
has no legal basis because the MMDAs
governing body, the Metro Manila Council,
did not authorize it; (2) violates the Due
Process Clause because it is a summary
punishment for jaywalking; (3) disregards the
Constitutional protection against cruel,
degrading, and inhuman punishment; and (4)
violates pedestrian rights as it exposes
pedestrians to various potential hazards.
In their Comment, respondents sought the
dismissal of the petition for petitioners lack of
standing to litigate and for violation of the
doctrine of hierarchy of courts. Alternatively,
respondents contended that the Flag Scheme is
a valid preventive measure against
jaywalking.
ISSUE: W/N the petition is meritorious
RULING: NO, the petition is non-
meritorious
A citizen can raise a constitutional question
only when (1) he can show that he has
personally suffered some actual or threatened
injury because of the allegedly illegal conduct
of the government; (2) the injury is fairly
traceable to the challenged action; and (3) a
favorable action will likely redress the injury.
On the other hand, a party suing as a taxpayer
must specifically show that he has a sufficient
interest in preventing the illegal expenditure
of money raised by taxation and that he will
sustain a direct injury as a result of the
enforcement of the questioned statute.
Petitioner meets none of the requirements
under either category.
Nor is there merit to petitioners claim that the
Court should relax the standing requirement
because of the transcendental importance of
the issues the petition raises. As an exception
to the standing requirement, the
transcendental importance of the issues raised
relates to the merits of the petition Thus, the
party invoking it must show, among others,
the presence of a clear disregard of a
constitutional or statutory prohibition.
Petitioner has not shown such clear
constitutional or statutory violation.
On the Flag Schemes alleged lack of legal
basis, we note that all the cities and
municipalities within the MMDAs jurisdiction,
except Valenzuela City, have each enacted
anti-jaywalking ordinances or traffic
management codes with provisions for
pedestrian regulation. Such fact serves as
sufficient basis for respondents
implementation of schemes, or ways and
means, to enforce the anti-jaywalking
ordinances and similar regulations. After all,
the MMDA is an administrative agency tasked
with the implementation of rules and
regulations enacted by proper authorities. The
absence of an anti-jaywalking ordinance in
Valenzuela City does not detract from this
conclusion absent any proof that respondents
implemented the Flag Scheme in that city.
Further, the petition ultimately calls for a
factual determination of whether the Flag
Scheme is a reasonable enforcement of anti-
jaywalking ordinances and similar
enactments.
ORGANIC ACT OF ARMM
Abbas vs. Comelec
FACTS: These consolidated petitions pray that
the Court: (1) enjoin the Commission on
Elections (COMELEC) from conducting the
plebiscite and the Secretary of Budget and
Management from releasing funds to the
COMELEC for that purpose; and (2) declare
R.A. No. 6734, or parts thereof,
unconstitutional .
ISSUE: W/N the Organic Act of ARMM is
unconstitutional
RULING: NO, it is not repugnant with the
constitution
In 1987, a new Constitution was ratified,
which the for the first time provided for
regional autonomy, Article X, section 15 of the
charter provides that "[t]here shall be created
autonomous regions in Muslim Mindanao and
in the Cordilleras consisting of provinces,
cities, municipalities, and geographical areas
sharing common and distinctive historical and
cultural heritage, economic and social
structures, and other relevant characteristics
within the framework of this Constitution and
the national sovereignty as well as territorial
integrity of the Republic of the Philippines."
We find it neither necessary nor determinative
of the case to rule on the nature of the Tripoli
Agreement and its binding effect on the
Philippine Government whether under public
international or internal Philippine law. In the
first place, it is now the Constitution itself that
provides for the creation of an autonomous
region in Muslim Mindanao. The standard for
any inquiry into the validity of R.A. No. 6734
would therefore be what is so provided in the
Constitution. Thus, any conflict between the
provisions of R.A. No. 6734 and the provisions
of the Tripoli Agreement will not have the
effect of enjoining the implementation of the
Organic Act. Assuming for the sake of
argument that the Tripoli Agreement is a
binding treaty or international agreement, it
would then constitute part of the law of the
land. But as internal law it would not be
superior to R.A. No. 6734, an enactment of the
Congress of the Philippines, rather it would be
in the same class as the latter. Thus, if at all,
R.A. No. 6734 would be amendatory of the
Tripoli Agreement, being a subsequent law.
Only a determination by this Court that R.A.
No. 6734 contravened the Constitution would
result in the granting of the reliefs sought
Thus, under the Constitution and R.A. No
6734, the creation of the autonomous region
shall take effect only when approved by a
majority of the votes cast by the constituent
units in a plebiscite, and only those provinces
and cities where a majority vote in favor of the
Organic Act shall be included in the
autonomous region. The provinces and cities
wherein such a majority is not attained shall
not be included in the autonomous region. It
may be that even if an autonomous region is
created, not all of the thirteen (13) provinces
and nine (9) cities mentioned in Article II,
section 1 (2) of R.A. No. 6734 shall be included
therein. The single plebiscite contemplated by
the Constitution and R.A. No. 6734 will
therefore be determinative of (1) whether there
shall be an autonomous region in Muslim
Mindanao and (2) which provinces and cities,
among those enumerated in R.A. No. 6734,
shall compromise it.
If the framers of the Constitution intended to
require approval by a majority of all the votes
cast in the plebiscite they would have so
indicated. Thus, in Article XVIII, section 27, it
is provided that "[t]his Constitution shall take
effect immediately upon its ratification by a
majority of the votes cast in a plebiscite held
for the purpose ... Comparing this with the
provision on the creation of the autonomous
region, which reads:
The creation of the autonomous region shall
be effective when approved by majority of the
votes cast by the constituent units in a
plebiscite called for the purpose, provided that
only provinces, cities and geographic areas
voting favorably in such plebiscite shall be
included in the autonomous region. [Art. X,
sec, 18, para, 2].
it will readily be seen that the creation of the
autonomous region is made to depend, not on
the total majority vote in the plebiscite, but on
the will of the majority in each of the
constituent units and the proviso underscores
this. for if the intention of the framers of the
Constitution was to get the majority of the
totality of the votes cast, they could have
simply adopted the same phraseology as that
used for the ratification of the Constitution, i.e.
"the creation of the autonomous region shall
be effective when approved by a majority of
the votes cast in a plebiscite called for the
purpose."
It is thus clear that what is required by the
Constitution is a simple majority of votes
approving the organic Act in individual
constituent units and not a double majority of
the votes in all constituent units put together,
as well as in the individual constituent units.
More importantly, because of its categorical
language, this is also the sense in which the
vote requirement in the plebiscite provided
under Article X, section 18 must have been
understood by the people when they ratified
the Constitution.
Invoking the earlier cited constitutional
provisions, petitioner Mama-o, on the other
hand, maintains that only those areas which,
to his view, share common and distinctive
historical and cultural heritage, economic and
social structures, and other relevant
characteristics should be properly included
within the coverage of the autonomous region.
He insists that R.A. No. 6734 is
unconstitutional because only the provinces of
Basilan, Sulu, Tawi-Tawi, Lanao del Sur,
Lanao del Norte and Maguindanao and the
cities of Marawi and Cotabato, and not all of
the thirteen (13) provinces and nine (9) cities
included in the Organic Act, possess such
concurrence in historical and cultural heritage
and other relevant characteristics. By
including areas which do not strictly share the
same characteristics. By including areas which
do not strictly share the same characteristic as
the others, petitioner claims that Congress has
expanded the scope of the autonomous region
which the constitution itself has prescribed to
be limited.
Petitioner's argument is not tenable. The
Constitution lays down the standards by
which Congress shall determine which areas
should constitute the autonomous region.
Guided by these constitutional criteria, the
ascertainment by Congress of the areas that
share common attributes is within the
exclusive realm of the legislature's discretion.
Any review of this ascertainment would have
to go into the wisdom of the law. This the
Court cannot do without doing violence to the
separation of governmental powers.
Petitioner's contention runs counter to the
very same constitutional provision he had
earlier invoked. Any determination by
Congress of what areas in Mindanao should
compromise the autonomous region, taking
into account shared historical and cultural
heritage, economic and social structures, and
other relevant characteristics, would
necessarily carry with it the exclusion of other
areas. As earlier stated, such determination by
Congress of which areas should be covered by
the organic act for the autonomous region
constitutes a recognized legislative
prerogative, whose wisdom may not be
inquired into by this Court.
It must be pointed out that what is referred to
in R.A. No. 6734 is the merger of
administrative regions, i.e. Regions I to XII
and the National Capital Region, which are
mere groupings of contiguous provinces for
administrative purposes [Integrated
Reorganization Plan (1972), which was made
as part of the law of the land by Pres. dec. No.
1, Pres. Dec. No. 742]. Administrative regions
are not territorial and political subdivisions
like provinces, cities, municipalities and
barangays [see Art. X, sec. 1 of the
Constitution]. While the power to merge
administrative regions is not expressly
provided for in the Constitution, it is a power
which has traditionally been lodged with the
President to facilitate the exercise of the power
of general supervision over local governments
[see Art. X, sec. 4 of the Constitution]. There is
no conflict between the power of the President
to merge administrative regions with the
constitutional provision requiring a plebiscite
in the merger of local government units
because the requirement of a plebiscite in a
merger expressly applies only to provinces,
cities, municipalities or barangays, not to
administrative regions.
Under the Constitution, the creation of the
autonomous region hinges only on the result
of the plebiscite. if the Organic Act is
approved by majority of the votes cast by
constituent units in the scheduled plebiscite,
the creation of the autonomous region
immediately takes effect delay the creation of
the autonomous region.
Under the constitution, the creation of the
autonomous region hinges only on the result
of the plebiscite. if the Organic Act is
approved by majority of the votes cast by
constituent units in the scheduled plebiscite,
the creation of the autonomous region
immediately takes effect. The questioned
provisions in R.A. No. 6734 requiring an
oversight Committee to supervise the transfer
do not provide for a different date of
effectivity. Much less would the organization
of the Oversight Committee cause an
impediment to the operation of the Organic
Act, for such is evidently aimed at effecting a
smooth transition period for the regional
government. The constitutional objection on
this point thus cannot be sustained as there is
no bases therefor.
Chionbian vs. Orbos
FACTS: Pursuant to Art. X, 18 of the 1987
Constitution, Congress passed R.A. No. 6734,
the Organic Act for the Autonomous Region in
Muslim Mindanao, calling for a plebiscite to
be held in the provinces of Basilan, Cotobato,
Davao del Sur, Lanao del Norte, Lanao del
Sur, Maguindanao, Palawan, South Cotabato,
Sultan Kudarat, Sulu, Tawi-Tawi, Zamboanga
del Norte, and Zamboanga del Sur, and the
cities of Cotabato, Dapitan, Dipolog, General
Santos, Iligan, Marawi, Pagadian, Puerto
Princesa and Zamboanga. In the ensuing
plebiscite held on November 16, 1989, four
provinces voted in favor of creating an
autonomous region. These are the provinces of
Lanao del Sur, Maguindanao, Sulu and Tawi-
Tawi. In accordance with the constitutional
provision, these provinces became the
Autonomous Region in Muslim Mindanao.
On the other hand, with respect to provinces
and cities not voting in favor of the
Autonomous Region, Art. XIX, 13 of R.A.
No. 6734 provides,
That only the provinces and cities voting
favorably in such plebiscites shall be included
in the Autonomous Region in Muslim
Mindanao. The provinces and cities which in
the plebiscite do not vote for inclusion in the
Autonomous Region shall remain in the
existing administrative regions. Provided,
however, that the President may, by
administrative determination, merge the
existing regions.
These suits challenge the validity of a
provision of the Organic Act for the
Autonomous Region in Muslim Mindanao
(R.A. No. 6734), authorizing the President of
the Philippines to "merge" by administrative
determination the regions remaining after the
establishment of the Autonomous Region, and
the Executive Order issued by the President
pursuant to such authority, "Providing for the
Reorganization of Administrative Regions in
Mindanao." A temporary restraining order
prayed for by the petitioners was issued by
this Court on January 29, 1991, enjoining the
respondents from enforcing the Executive
Order and statute in question.
The Solicitor General defends the
reorganization of regions in Mindanao by E.O.
No. 429 as merely the exercise of a power
"traditionally lodged in the President," as held
in Abbas v. Comelec,
The Solicitor General justifies the grant to the
President of the power "to merge the existing
regions" as something fairly embraced in the
title of R.A. No. 6734, to wit, "An Act
Providing for an Organic Act for the
Autonomous Region in Muslim Mindanao,"
because it is germane to it.
He argues that the power is not limited to the
merger of those regions in which the provinces
and cities which took part in the plebiscite are
located but that it extends to all regions in
Mindanao as necessitated by the establishment
of the autonomous region.
ISSUE: W/N the power to merge
administrative regions can be performed by
the executive
RULING: YES, it can be performed by the
executive due to the law mentioned below
It will be useful to recall first the nature of
administrative regions and the basis and
purpose for their creation. On September 9,
1968, R.A. No. 5435 was passed "authorizing
the President of the Philippines, with the help
of a Commission on Reorganization, to
reorganize the different executive
departments, bureaus, offices, agencies and
instrumentalities of the government, including
banking or financial institutions and
corporations owned or controlled by it." The
purpose was to promote "simplicity, economy
and efficiency in the government."4 The
Commission on Reorganization created under
the law was required to submit an integrated
reorganization plan not later than December
31, 1969 to the President who was in turn
required to submit the plan to Congress
within forty days after the opening of its next
regular session. The law provided that any
reorganization plan submitted would become
effective only upon the approval of Congress.
Accordingly, the Reorganization Commission
prepared an Integrated Reorganization Plan
which divided the country into eleven
administrative regions.
Thus the creation and subsequent
reorganization of administrative regions have
been by the President pursuant to authority
granted to him by law. In conferring on the
President the power "to merge [by
administrative determination] the existing
regions" following the establishment of the
Autonomous Region in Muslim Mindanao,
Congress merely followed the pattern set in
previous legislation dating back to the initial
organization of administrative regions in 1972.
The choice of the President as delegate is
logical because the division of the country into
regions is intended to facilitate not only the
administration of local governments but also
the direction of executive departments which
the law requires should have regional offices.
As this Court observed in Abbas, "while the
power to merge administrative regions is not
expressly provided for in the Constitution, it is
a power which has traditionally been lodged
with the President to facilitate the exercise of
the power of general supervision over local
governments [see Art. X, 4 of the
Constitution]." The regions themselves are not
territorial and political divisions like
provinces, cities, municipalities and barangays
but are "mere groupings of contiguous
provinces for administrative purposes."7 The
power conferred on the President is similar to
the power to adjust municipal boundaries
which has been described in Pelaez v. Auditor
General or as "administrative in nature."
There is, therefore, no abdication by Congress
of its legislative power in conferring on the
President the power to merge administrative
regions. The question is whether Congress has
provided a sufficient standard by which the
President is to be guided in the exercise of the
power granted and whether in any event the
grant of power to him is included in the
subject expressed in the title of the law.
With respect to the power to merge existing
administrative regions, the standard is to be
found in the same policy underlying the grant
to the President in R.A. No. 5435 of the power
to reorganize the Executive Department, to
wit: "to promote simplicity, economy and
efficiency in the government to enable it to
pursue programs consistent with national
goals for accelerated social and economic
development and to improve the service in the
transaction of the public business."12 Indeed,
as the original eleven administrative regions
were established in accordance with this
policy, it is logical to suppose that in
authorizing the President to "merge [by
administrative determination] the existing
regions" in view of the withdrawal from some
of those regions of the provinces now
constituting the Autonomous Region, the
purpose of Congress was to reconstitute the
original basis for the organization of
administrative regions.
Finally, it is contended that the power granted
to the President is limited to the
reorganization of administrative regions in
which some of the provinces and cities which
voted in favor of regional autonomy are
found, because Art. XIX, 13 provides that
those which did not vote for autonomy "shall
remain in the existing administrative regions."
The contention has no merit. While Art. XIX,
13 provides that "The provinces and cities
which do not vote for inclusion in the
Autonomous Region shall remain in the
existing administrative regions," this provision
is subject to the qualification that "the
President may by administrative
determination merge the existing regions."
This means that while non-assenting
provinces and cities are to remain in the
regions as designated upon the creation of the
Autonomous Region, they may nevertheless
be regrouped with contiguous provinces
forming other regions as the exigency of
administration may require.
The regrouping is done only on paper. It
involves no more than are definition or
redrawing of the lines separating
administrative regions for the purpose of
facilitating the administrative supervision of
local government units by the President and
insuring the efficient delivery of essential
services. There will be no "transfer" of local
governments from one region to another
except as they may thus be regrouped so that a
province like Lanao del Norte, which is at
present part of Region XII, will become part of
Region IX.
The regrouping of contiguous provinces is not
even analogous to a redistricting or to the
division or merger of local governments,
which all have political consequences on the
right of people residing in those political units
to vote and to be voted for. It cannot be
overemphasized that administrative regions
are mere groupings of contiguous provinces
for administrative purposes, not for political
representation.
Kida vs. Senate of the Philippines (MAIN)
FACTS: On June 30, 2011, Republic Act (RA)
No. 10153, entitled An Act Providing for the
Synchronization of the Elections in the
Autonomous Region in Muslim Mindanao
(ARMM) with the National and Local
Elections and for Other Purposes was enacted.
The law reset the ARMM elections from the
8th of August 2011, to the second Monday of
May 2013 and every three (3) years thereafter,
to coincide with the countrys regular national
and local elections. The law as well granted
the President the power to appoint officers-in-
charge (OICs) for the Office of the Regional
Governor, the Regional Vice-Governor, and
the Members of the Regional Legislative
Assembly, who shall perform the functions
pertaining to the said offices until the officials
duly elected in the May 2013 elections shall
have qualified and assumed office.
On August 1, 1989 or two years after the
effectivity of the 1987 Constitution, Congress
acted through Republic Act (RA) No. 6734
entitled An Act Providing for an Organic Act
for the Autonomous Region in Muslim
Mindanao. A plebiscite was held on
November 6, 1990 as required by Section 18(2),
Article X of RA No. 6734, thus fully
establishing the Autonomous Region of
Muslim Mindanao (ARMM). The initially
assenting provinces were Lanao del Sur,
Maguindanao, Sulu and Tawi-tawi. RA No.
6734 scheduled the first regular elections for
the regional officials of the ARMM on a date
not earlier than 60 days nor later than 90 days
after its ratification.
RA No. 9054 (entitled An Act to Strengthen
and Expand the Organic Act for the
Autonomous Region in Muslim Mindanao,
Amending for the Purpose Republic Act No.
6734, entitled An Act Providing for the
Autonomous Region in Muslim Mindanao, as
Amended) was the next legislative act passed.
This law provided further refinement in the
basic ARMM structure first defined in the
original organic act, and reset the regular
elections for the ARMM regional officials to
the second Monday of September 2001.
The petitions assailing RA No. 10153 further
maintain that it is unconstitutional for its
failure to comply with the three-reading
requirement of Section 26(2), Article VI of the
Constitution. Also cited as grounds are the
alleged violations of the right of suffrage of the
people of ARMM, as well as the failure to
adhere to the elective and representative
character of the executive and legislative
departments of the ARMM. Lastly, the
petitioners challenged the grant to the
President of the power to appoint OICs to
undertake the functions of the elective ARMM
officials until the officials elected under the
May 2013 regular elections shall have assumed
office. Corrolarily, they also argue that the
power of appointment also gave the President
the power of control over the ARMM, in
complete violation of Section 16, Article X of
the Constitution.
ISSUE: W/N it is repugnant with the
constitution
RULING: NO, it is not repugnant with the
constitution
While the Constitution does not expressly
state that Congress has to synchronize
national and local elections, the clear intent
towards this objective can be gleaned from the
Transitory Provisions (Article XVIII) of the
Constitution,[10] which show the extent to
which the Constitutional Commission, by
deliberately making adjustments to the terms
of the incumbent officials, sought to attain
synchronization of elections.
The objective behind setting a common
termination date for all elective officials, done
among others through the shortening the
terms of the twelve winning senators with the
least number of votes, is to synchronize the
holding of all future elections whether
national or local to once every three years.
This intention finds full support in the
discussions during the Constitutional
Commission deliberations.
These Constitutional Commission exchanges,
read with the provisions of the Transitory
Provisions of the Constitution, all serve as
patent indicators of the constitutional mandate
to hold synchronized national and local
elections, starting the second Monday of May,
1992 and for all the following elections.
Although called regional elections, the ARMM
elections should be included among the
elections to be synchronized as it is a local
election based on the wording and structure of
the Constitution.
A basic rule in constitutional construction is
that the words used should be understood in
the sense that they have in common use and
given their ordinary meaning, except when
technical terms are employed, in which case
the significance thus attached to them prevails.
Regional elections in the ARMM for the
positions of governor, vice-governor and
regional assembly representatives obviously
fall within this classification, since they pertain
to the elected officials who will serve within
the limited region of ARMM.
From the perspective of the Constitution,
autonomous regions are considered one of the
forms of local governments, as evident from
Article X of the Constitution entitled Local
Government. Autonomous regions are
established and discussed under Sections 15 to
21 of this Article the article wholly devoted to
Local Government. That an autonomous
region is considered a form of local
government is also reflected in Section 1,
Article X of the Constitution
In the present case, the records show that the
President wrote to the Speaker of the House of
Representatives to certify the necessity of the
immediate enactment of a law synchronizing
the ARMM elections with the national and
local elections.[20] Following our Tolentino
ruling, the Presidents certification exempted
both the House and the Senate from having to
comply with the three separate readings
requirement.
The House of Representatives and the Senate
in the exercise of their legislative discretion
gave full recognition to the Presidents
certification and promptly enacted RA No.
10153. Under the circumstances, nothing short
of grave abuse of discretion on the part of the
two houses of Congress can justify our
intrusion under our power of judicial review
In any case, despite the Presidents
certification, the two-fold purpose that
underlies the requirement for three readings
on separate days of every bill must always be
observed to enable our legislators and other
parties interested in pending bills to
intelligently respond to them. Specifically, the
purpose with respect to Members of Congress
is: (1) to inform the legislators of the matters
they shall vote on and (2) to give them notice
that a measure is in progress through the
enactment process.
We find, based on the records of the
deliberations on the law, that both advocates
and the opponents of the proposed measure
had sufficient opportunities to present their
views. In this light, no reason exists to nullify
RA No. 10153 on the cited ground.
In the first place, neither RA No. 9333 nor RA
No. 10153 amends RA No. 9054. As an
examination of these laws will show, RA No.
9054 only provides for the schedule of the first
ARMM elections and does not fix the date of
the regular elections. A need therefore existed
for the Congress to fix the date of the
subsequent ARMM regular elections, which it
did by enacting RA No. 9333 and thereafter,
RA No. 10153. Obviously, these subsequent
laws RA No. 9333 and RA No. 10153 cannot be
considered amendments to RA No. 9054 as
they did not change or revise any provision in
the latter law; they merely filled in a gap in RA
No. 9054 or supplemented the law by
providing the date of the subsequent regular
elections.
Section 18, Article X of the Constitution
plainly states that The creation of the
autonomous region shall be effective when
approved by the majority of the votes case by
the constituent units in a plebiscite called for
the purpose. With these wordings as standard,
we interpret the requirement to mean that
only amendments to, or revisions of, the
Organic Act constitutionally-essential to the
creation of autonomous regions i.e., those
aspects specifically mentioned in the
Constitution which Congress must provide for
in the Organic Act require ratification through
a plebiscite. These amendments to the Organic
Act are those that relate to: (a) the basic
structure of the regional government; (b) the
regions judicial system, i.e., the special courts
with personal, family, and property law
jurisdiction; and, (c) the grant and extent of the
legislative powers constitutionally conceded to
the regional government under Section 20,
Article X of the Constitution.
The date of the ARMM elections does not fall
under any of the matters that the Constitution
specifically mandated Congress to provide for
in the Organic Act. Therefore, even assuming
that the supermajority votes and the plebiscite
requirements are valid, any change in the date
of elections cannot be construed as a
substantial amendment of the Organic Act that
would require compliance with these
requirements.
Since elective ARMM officials are local
officials, they are covered and bound by the
three-year term limit prescribed by the
Constitution; they cannot extend their term
through a holdover.
In the case of the terms of local officials, their
term has been fixed clearly and unequivocally,
allowing no room for any implementing
legislation with respect to the fixed term itself
and no vagueness that would allow an
interpretation from this Court. Thus, the term
of three years for local officials should stay at
three (3) years as fixed by the Constitution and
cannot be extended by holdover by Congress.
If it will be claimed that the holdover period is
effectively another term mandated by
Congress, the net result is for Congress to
create a new term and to appoint the occupant
for the new term. This view like the extension
of the elective term is constitutionally infirm
because Congress cannot do indirectly what it
cannot do directly, i.e., to act in a way that
would effectively extend the term of the
incumbents. Indeed, if acts that cannot be
legally done directly can be done indirectly,
then all laws would be illusory.[55] Congress
cannot also create a new term and effectively
appoint the occupant of the position for the
new term. This is effectively an act of
appointment by Congress and an
unconstitutional intrusion into the
constitutional appointment power of the
President.[56] Hence, holdover whichever way
it is viewed is a constitutionally infirm option
that Congress could not have undertaken.
Even assuming that holdover is
constitutionally permissible, and there had
been statutory basis for it (namely Section 7,
Article VII of RA No. 9054) in the past,[60] we
have to remember that the rule of holdover
can only apply as an available option where
no express or implied legislative intent to the
contrary exists; it cannot apply where such
contrary intent is evident.[61]
Congress, in passing RA No. 10153, made it
explicitly clear that it had the intention of
suppressing the holdover rule that prevailed
under RA No. 9054 by completely removing
this provision. The deletion is a policy decision
that is wholly within the discretion of
Congress to make in the exercise of its plenary
legislative powers; this Court cannot pass
upon questions of wisdom, justice or
expediency of legislation,[62] except where an
attendant unconstitutionality or grave abuse
of discretion results.
A close reading of Section 5 of BP 881 reveals
that it is meant to address instances where
elections have already been scheduled to take
place but have to be postponed because of (a)
violence, (b) terrorism, (c) loss or destruction
of election paraphernalia or records, (d) force
majeure, and (e) other analogous causes of
such a nature that the holding of a free,
orderly and honest election should become
impossible in any political subdivision. Under
the principle of ejusdem generis, the term
analogous causes will be restricted to those
unforeseen or unexpected events that prevent
the holding of the scheduled elections. These
analogous causes are further defined by the
phrase of such nature that the holding of a
free, orderly and honest election should
become impossible.
Similarly, Section 6 of BP 881 applies only to
those situations where elections have already
been scheduled but do not take place because
of (a) force majeure, (b) violence, (c) terrorism,
(d) fraud, or (e) other analogous causes the
election in any polling place has not been held
on the date fixed, or had been suspended
before the hour fixed by law for the closing of
the voting, or after the voting and during the
preparation and the transmission of the
election returns or in the custody or canvass
thereof, such election results in a failure to
elect. As in Section 5 of BP 881, Section 6
addresses instances where the elections do not
occur or had to be suspended because of
unexpected and unforeseen circumstances.
In the present case, the postponement of the
ARMM elections is by law i.e., by
congressional policy and is pursuant to the
constitutional mandate of synchronization of
national and local elections. By no stretch of
the imagination can these reasons be given the
same character as the circumstances
contemplated by Section 5 or Section 6 of BP
881, which all pertain to extralegal causes that
obstruct the holding of elections. Courts, to be
sure, cannot enlarge the scope of a statute
under the guise of interpretation, nor include
situations not provided nor intended by the
lawmakers.[66] Clearly, neither Section 5 nor
Section 6 of BP 881 can apply to the present
case and this Court has absolutely no legal
basis to compel the COMELEC to hold special
elections.
Thus, in the same way that the term of elective
ARMM officials cannot be extended through a
holdover, the term cannot be shortened by
putting an expiration date earlier than the
three (3) years that the Constitution itself
commands. This is what will happen a term of
less than two years if a call for special elections
shall prevail. In sum, while synchronization is
achieved, the result is at the cost of a violation
of an express provision of the Constitution.
The above considerations leave only Congress
chosen interim measure RA No. 10153 and the
appointment by the President of OICs to
govern the ARMM during the pre-
synchronization period pursuant to Sections 3,
4 and 5 of this law as the only measure that
Congress can make. This choice itself,
however, should be examined for any
attendant constitutional infirmity.
This provision classifies into four groups the
officers that the President can appoint. These
are:
First, the heads of the executive departments;
ambassadors; other public ministers and
consuls; officers of the Armed Forces of the
Philippines, from the rank of colonel or naval
captain; and other officers whose
appointments are vested in the President in
this Constitution;
Second, all other officers of the government
whose appointments are not otherwise
provided for by law;
Third, those whom the President may be
authorized by law to appoint; and
Fourth, officers lower in rank whose
appointments the Congress may by law vest in
the President alone.
fter fully examining the issue, we hold that
this alleged constitutional problem is more
apparent than real and becomes very real only
if RA No. 10153 were to be mistakenly read as
a law that changes the elective and
representative character of ARMM positions.
RA No. 10153, however, does not in any way
amend what the organic law of the ARMM
(RA No. 9054) sets outs in terms of structure of
governance. What RA No. 10153 in fact only
does is to appoint officers-in-charge for the
Office of the Regional Governor, Regional Vice
Governor and Members of the Regional
Legislative Assembly who shall perform the
functions pertaining to the said offices until
the officials duly elected in the May 2013
elections shall have qualified and assumed
office. This power is far different from
appointing elective ARMM officials for the
abbreviated term ending on the assumption to
office of the officials elected in the May 2013
elections.
As we have already established in our
discussion of the supermajority and plebiscite
requirements, the legal reality is that RA No.
10153 did not amend RA No. 9054. RA No.
10153, in fact, provides only for
synchronization of elections and for the
interim measures that must in the meanwhile
prevail. And this is how RA No. 10153 should
be read in the manner it was written and
based on its unambiguous facial terms.[75]
Aside from its order for synchronization, it is
purely and simply an interim measure
responding to the adjustments that the
synchronization requires.
Viewed from another perspective,
synchronization will temporarily disrupt the
election process in a local community, the
ARMM, as well as the communitys choice of
leaders, but this will take place under a
situation of necessity and as an interim
measure in the manner that interim measures
have been adopted and used in the creation of
local government units[76] and the
adjustments of sub-provinces to the status of
provinces.[77] These measures, too, are used
in light of the wider national demand for the
synchronization of elections (considered vis--
vis the regional interests involved). The
adoption of these measures, in other words, is
no different from the exercise by Congress of
the inherent police power of the State, where
one of the essential tests is the reasonableness
of the interim measure taken in light of the
given circumstances.
Furthermore, the representative character of
the chosen leaders need not necessarily be
affected by the appointment of OICs as this
requirement is really a function of the
appointment process; only the elective aspect
shall be supplanted by the appointment of
OICs. In this regard, RA No. 10153
significantly seeks to address concerns arising
from the appointments by providing, under
Sections 3, 4 and 5 of the assailed law, concrete
terms in the Appointment of OIC, the Manner
and Procedure of Appointing OICs, and their
Qualifications.
Based on these considerations, we hold that
RA No. 10153 viewed in its proper context is a
law that is not violative of the Constitution
(specifically, its autonomy provisions), and
one that is reasonable as well under the
circumstances.
Given that the incumbent ARMM elective
officials cannot continue to act in a holdover
capacity upon the expiration of their terms,
and this Court cannot compel the COMELEC
to conduct special elections, the Court now has
to deal with the dilemma of a vacuum in
governance in the ARMM.
As in Menzon, leaving the positions of ARMM
Governor, Vice Governor, and members of the
Regional Legislative Assembly vacant for 21
months, or almost 2 years, would clearly cause
disruptions and delays in the delivery of basic
services to the people, in the proper
management of the affairs of the regional
government, and in responding to critical
developments that may arise. When viewed in
this context, allowing the President in the
exercise of his constitutionally-recognized
appointment power to appoint OICs is, in our
judgment, a reasonable measure to take.
It is further argued that while synchronization
may be constitutionally mandated, it cannot be
used to defeat or to impede the autonomy that
the Constitution granted to the ARMM.
Phrased in this manner, one would presume
that there exists a conflict between two
recognized Constitutional mandates
synchronization and regional autonomy such
that it is necessary to choose one over the
other.
As heretofore mentioned and discussed, while
autonomous regions are granted political
autonomy, the framers of the Constitution
never equated autonomy with independence.
The ARMM as a regional entity thus continues
to operate within the larger framework of the
State and is still subject to the national policies
set by the national government, save only for
those specific areas reserved by the
Constitution for regional autonomous
determination. As reflected during the
constitutional deliberations of the provisions
on autonomous regions
In other words, the autonomy granted to the
ARMM cannot be invoked to defeat national
policies and concerns. Since the
synchronization of elections is not just a
regional concern but a national one, the
ARMM is subject to it; the regional autonomy
granted to the ARMM cannot be used to
exempt the region from having to act in
accordance with a national policy mandated
by no less than the Constitution.
Kidda vs. Senate (MOTION FOR RECON)
The Court was unanimous in holding that the
Constitution mandates the synchronization of
national and local elections. While the
Constitution does not expressly instruct
Congress to synchronize the national and local
elections, the intention can be inferred from
the following provisions of the Transitory
Provisions (Article XVIII) of the Constitution
The framers of the Constitution could not have
expressed their objective more clearly there
was to be a single election in 1992 for all
elective officials from the President down to
the municipal officials. Significantly, the
framers were even willing to temporarily
lengthen or shorten the terms of elective
officials in order to meet this objective,
highlighting the importance of this
constitutional mandate.
Neither do we find any merit in the petitioners
contention that the ARMM elections are not
covered by the constitutional mandate of
synchronization because the ARMM elections
were not specifically mentioned in the above-
quoted Transitory Provisions of the
Constitution.
That the ARMM elections were not expressly
mentioned in the Transitory Provisions of the
Constitution on synchronization cannot be
interpreted to mean that the ARMM elections
are not covered by the constitutional mandate
of synchronization. We have to consider that
the ARMM, as we now know it, had not yet
been officially organized at the time the
Constitution was enacted and ratified by the
people. Keeping in mind that a constitution is
not intended to provide merely for the
exigencies of a few years but is to endure
through generations for as long as it remains
unaltered by the people as ultimate sovereign,
a constitution should be construed in the light
of what actually is a continuing instrument to
govern not only the present but also the
unfolding events of the indefinite future.
Although the principles embodied in a
constitution remain fixed and unchanged from
the time of its adoption, a constitution must be
construed as a dynamic process intended to
stand for a great length of time, to be
progressive and not static.
To reiterate, Article X of the Constitution,
entitled Local Government, clearly shows the
intention of the Constitution to classify
autonomous regions, such as the ARMM, as
local governments.
The inclusion of autonomous regions in the
enumeration of political subdivisions of the
State under the heading Local Government
indicates quite clearly the constitutional intent
to consider autonomous regions as one of the
forms of local governments.
That the Constitution mentions only the
national government and the local
governments, and does not make a distinction
between the local government and the
regional government, is particularly revealing,
betraying as it does the intention of the
framers of the Constitution to consider the
autonomous regions not as separate forms of
government, but as political units which,
while having more powers and attributes than
other local government units, still remain
under the category of local governments. Since
autonomous regions are classified as local
governments, it follows that elections held in
autonomous regions are also considered as
local elections.
Section 18, Article X of the Constitution
provides that [t]he creation of the autonomous
region shall be effective when approved by
majority of the votes cast by the constituent
units in a plebiscite called for the purpose[.]
We interpreted this to mean that only
amendments to, or revisions of, the Organic
Act constitutionally-essential to the creation of
autonomous regions i.e., those aspects
specifically mentioned in the Constitution
which Congress must provide for in the
Organic Act[21] require ratification through a
plebiscite. We stand by this interpretation.
While we agree with the petitioners
underlying premise that sovereignty
ultimately resides with the people, we
disagree that this legal reality necessitates
compliance with the plebiscite requirement for
all amendments to RA No. 9054. For if we
were to go by the petitioners interpretation of
Section 18, Article X of the Constitution that all
amendments to the Organic Act have to
undergo the plebiscite requirement before
becoming effective, this would lead to
impractical and illogical results hampering the
ARMMs progress by impeding Congress from
enacting laws that timely address problems as
they arise in the region, as well as weighing
down the ARMM government with the costs
that unavoidably follow the holding of a
plebiscite.
The clear wording of Section 8, Article X of the
Constitution expresses the intent of the
framers of the Constitution to categorically set
a limitation on the period within which all
elective local officials can occupy their offices.
We have already established that elective
ARMM officials are also local officials; they
are, thus, bound by the three-year term limit
prescribed by the Constitution. It, therefore,
becomes irrelevant that the Constitution does
not expressly prohibit elective officials from
acting in a holdover capacity. Short of
amending the Constitution, Congress has no
authority to extend the three-year term limit
by inserting a holdover provision in RA No.
9054. Thus, the term of three years for local
officials should stay at three (3) years, as fixed
by the Constitution, and cannot be extended
by holdover by Congress.
Congress, in passing RA No. 10153 and
removing the holdover option, has made it
clear that it wants to suppress the holdover
rule expressed in RA No. 9054. Congress, in
the exercise of its plenary legislative powers,
has clearly acted within its discretion when it
deleted the holdover option, and this Court
has no authority to question the wisdom of
this decision, absent any evidence of
unconstitutionality or grave abuse of
discretion. It is for the legislature and the
executive, and not this Court, to decide how to
fill the vacancies in the ARMM regional
government which arise from the legislature
complying with the constitutional mandate of
synchronization.
Neither do we find any merit in the contention
that the Commission on Elections (COMELEC)
is sufficiently empowered to set the date of
special elections in the ARMM. To recall, the
Constitution has merely empowered the
COMELEC to enforce and administer all laws
and regulations relative to the conduct of an
election. Although the legislature, under the
Omnibus Election Code (Batas Pambansa
Bilang [BP] 881), has granted the COMELEC
the power to postpone elections to another
date, this power is confined to the specific
terms and circumstances provided for in the
law.
As we have previously observed in our
assailed decision, both Section 5 and Section 6
of BP 881 address instances where elections
have already been scheduled to take place but
do not occur or had to be suspended because
of unexpected and unforeseen circumstances,
such as violence, fraud, terrorism, and other
analogous circumstances.
In contrast, the ARMM elections were
postponed by law, in furtherance of the
constitutional mandate of synchronization of
national and local elections. Obviously, this
does not fall under any of the circumstances
contemplated by Section 5 or Section 6 of BP
881.
The first group of presidential appointments,
specified as the heads of the executive
departments, ambassadors, other public
ministers and consuls, or officers of the Armed
Forces, and other officers whose appointments
are vested in the President by the Constitution,
pertains to the appointive officials who have
to be confirmed by the Commission on
Appointments.
The second group of officials the President can
appoint are all other officers of the
Government whose appointments are not
otherwise provided for by law, and those
whom he may be authorized by law to
appoint.[27] The second sentence acts as the
catch-all provision for the Presidents
appointment power, in recognition of the fact
that the power to appoint is essentially
executive in nature.[28] The wide latitude
given to the President to appoint is further
demonstrated by the recognition of the
Presidents power to appoint officials whose
appointments are not even provided for by
law. In other words, where there are offices
which have to be filled, but the law does not
provide the process for filling them, the
Constitution recognizes the power of the
President to fill the office by appointment.
Given that the President derives his power to
appoint OICs in the ARMM regional
government from law, it falls under the
classification of presidential appointments
covered by the second sentence of Section 16,
Article VII of the Constitution; the Presidents
appointment power thus rests on clear
constitutional basis.
We admit that synchronization will
temporarily disrupt the election process in a
local community, the ARMM, as well as the
communitys choice of leaders. However, we
have to keep in mind that the adoption of this
measure is a matter of necessity in order to
comply with a mandate that the Constitution
itself has set out for us. Moreover, the
implementation of the provisions of RA No.
10153 as an interim measure is comparable to
the interim measures traditionally practiced
when, for instance, the President appoints
officials holding elective offices upon the
creation of new local government units.
The grant to the President of the power to
appoint OICs in place of the elective members
of the Regional Legislative Assembly is neither
novel nor innovative. The power granted to
the President, via RA No. 10153, to appoint
members of the Regional Legislative Assembly
is comparable to the power granted by BP 881
(the Omnibus Election Code) to the President
to fill any vacancy for any cause in the
Regional Legislative Assembly (then called the
Sangguniang Pampook).
ORGANIC ACT FOR CAR
Ordillo vs. COMELEC
FACTS: January 30, 1990, pursuant to
Republic Act No. 6766 entitled An Act
Providing for an Organic Act for the
Cordillera Autonomous Region, the people of
the provinces of Benguet, Mountain Province,
Ifugao, Abra and Kalinga-Apayao and the city
of Baguio cast their votes in a plebiscite.
Results of plebiscite: approved by majority of
5,889 votes in Ifugao, rejected by 148,676 in the
rest provinces and city. The province of Ifugao
makes up only 11% of total population, and as
such has the second smallest number of
inhabitants, of the abovementioned areas.
February 14, 1990, COMELEC issued
Resolution No. 2259 stating that the Organic
Act for the Region has been approved and/or
ratified by majority of votes cast only in the
province of Ifugao. Secretary of Justice also
issued a memorandum for the President
reiterating COMELEC resolution, stating that
Ifugao being the only province which
voted favorably then. Alone, legally and
validly constitutes CAR.
March 8, 1990, Congress ebacted Republic Act
No. 6861 setting elections in CAR of Ifugao on
first Monday of March 1991.
Even before COMELEC resolution, Executive
Secretary issued February 5, 1990 a
memorandum granting authority to wind up
the affairs of the Cordillera Executive Board
and Cordillera Regional Assembly created
under Executive Order No. 220.
March 30, 1990, President issued
Administrative Order No. 160 declaring
among others that the Cordillera Executive
Board and Cordillera Regional Assembly and
all offices under Executive Order No. 220 were
abolished in view of the ratification of Organic
Act.
Petitioners: there can be no valid Cordillera
Autonomous Region in only one province as
the Constitution and Republic Act No. 6766
require that the said Region be composed of
more than one constituent unit.
Petitioners therefore pray that the court:
a. declare null and void COMELEC
resolution No. 2259, the memorandum of the
Secretary of Justice, Administrative Order No.
160, and Republic Act No. 6861 and prohibit
and restrain the respondents from
implementing the same and spending public
funds for the purpose
b. declare Executive Order No. 220
constituting the Cordillera Executive Board
and the Cordillera Regional Assembly and
other offices to be still in force and effect until
another organic law for the Autonomous
Region shall have been enacted by Congress
and the same is duly ratified by the voters in
the constituent units.
ISSUE: W/N the province of Ifugao, being the
only province which voted favorably for the
creation of the Cordillera Autonomous Region
can, alone, legally and validly constitute such
region.
RULING: NO, it cannot be constituted as a
region
The sole province of Ifugao cannot validly
constitute the Cordillera Autonomous Region.
a. The keyword ins Article X, Section 15
of the 1987 Constitution provinces, cities,
municipalities and geographical areas connote
that region is to be made up of more than
one constituent unit. The term region used
in its ordinary sense means two or more
provinces.
- rule in statutory construction must be
applied here: the language of the Constitution,
as much as possible should be understood in
the sense it has in common use and that the
words used in constitutional provisions are to
be given their ordinary meaning except where
technical terms are employed.
b. The entirety of Republic Act No. 6766
creating the Cordillera Autonomous Region is
infused with provisions which rule against the
sole province of Ifugao constituting the
Region.
It can be gleaned that Congress never
intended that a single province may constitute
the autonomous region.
If this were so, we would be faced with the
absurd situation of having two sets of officials:
a set of provincial officials and another set of
regional officials exercising their executive and
legislative powers over exactly the same small
area. (Ifugao is one of the smallest provinces in
the Philippines, population-wise) (Art III sec 1
and 2; Art V, sec 1 and 4; Art XII sec 10 of RA
6766)
Allotment of Ten Million Pesos to Regional
Government for its initial organizational
requirements can not be construed as funding
only a lone and small province [Art XXI sec
13(B)(c)]
Certain provisions of the Act call for officials
coming from different provinces and cities
in the Region, as well as tribal courts and the
development of a common regional language.
(Art V sec 16; Art VI sec 3; Art VII; Art XV RA
6766)
Thus, to contemplate the situation envisioned
by the COMELEC would not only violate the
letter and intent of the Constitution and
Republic Act No. 6766 but would be
impractical and illogical.
Cordillera Broad Coalition vs. COMELEC
FACTS: Pursuant to a ceasefire agreement
signed on September 13, 1986, the Cordillera
Peoples Liberation Army (CPLA) and the
Cordillera Bodong Administration agreed that
the Cordillera people shall not undertake their
demands through armed and violent struggle
but by peaceful means, such as political
negotiations
A subsequent joint agreement was then
arrived at by the two parties. Such agreement
states that they are to:
Par. 2. Work together in drafting an Executive
Order to create a preparatory body that could
perform policy-making and administrative
functions and undertake consultations and
studies leading to a draft organic act for the
Cordilleras.
Par. 3. Have representatives from the
Cordillera panel join the study group of the
R.P. Panel in drafting the Executive Order.
Pursuant to the above joint agreement, E.O.
220 was drafted by a panel of the Philippine
government and of the representatives of the
Cordillera people. This was then signed into
law by President Corazon Aquino, in the
exercise of her legislative powers, creating the
Cordillera Administrative Region [CAR],
which covers the provinces of Abra, Benguet,
Ifugao, Kalinga-Apayao and Mountain
Province and the City of Baguio.
Petitioners assail the constitutionality of E.O.
220 on the primary ground that by issuing the
said order, the President, in the exercise of her
legislative powers, had virtually pre-empted
Congress from its mandated task of enacting
an organic act and created an autonomous
region in the Cordilleras.
ISSUE: W/N E.O 220 is Constitutional
RULING: YES, it is constitutional
The Supreme Court has come to the
conclusion that petitioners are unfounded.
E.O. 220 does not create the autonomous
region contemplated in the Constitution. It
merely provides for transitory measures in
anticipation of the enactment of an organic act
and the creation of an autonomous region. In
short, it prepares the ground for autonomy.
This does not necessarily conflict with the
provisions of the Constitution on autonomous
regions.
The Constitution outlines a complex
procedure for the creation of an autonomous
region in the Cordilleras. Since such process
will undoubtedly take time, the President saw
it fit to provide for some measures to address
the urgent needs of the Cordilleras in the
meantime that the organic act had not yet been
passed and the autonomous region created.
At this time, the President was still exercising
legislative powers as the First Congress had
not yet convened.
Based on Article X Section 18 of the
Constitution (providing the basic structure of
government in the autonomous region), the
Supreme Court finds that E. O. No. 220 did not
establish an autonomous regional
government. The bodies created by E. O. No.
220 do not supplant the existing local
governmental structure; nor are they
autonomous government agencies. They
merely constitute the mechanism for an
"umbrella" that brings together the existing
local governments, the agencies of the
National Government, the ethno-linguistic
groups or tribes and non-governmental
organizations in a concerted effort to spur
development in the Cordilleras.
In fact, it was Republic Act No. 6766, the
organic act for the Cordillera autonomous
region signed into law on October 23, 1989,
and the plebiscite for the approval of the act
which completed the autonomous region-
creating process outlined in the Constitution.
Therefore, E.O. 220 is constitutional. Petition
is dismissed for lack of merit.
LOCAL GOVERNMENT UNIT DEFINED
Alvarez vs. Guingona
FACTS: In April 1993, House Bill 8817 (An Act
Converting the Municipality of Santiago into
an Independent Component City to be known
as the City of Santiago) was passed in the
House of Representatives.
In May 1993, a Senate Bill (SB 1243) of similar
title and content with that of HB 8817 was
introduced in the Senate.
In January 1994, HB 8817 was transmitted to
the Senate. In February 1994, the Senate
conducted a public hearing on SB 1243. In
March 1994, the Senate Committee on Local
Government rolled out its recommendation
for approval of HB 8817 as it was totally the
same with SB 1243. Eventually, HB 8817
became a law (RA 7720).
Now Senator Heherson Alvarez et al are
assailing the constitutionality of the said law
on the ground that the bill creating the law did
not originate from the lower house and that
City of Santiago was not able to comply with
the income of at least P20M per annum in
order for it to be a city. That in the
computation of the reported average income
of P20,974,581.97, the IRA was included which
should not be
ISSUE: W/N IRA should be included in the
computation of an LGUs income
RULING: YES, they should be included in
the computation of LGUs income
It is true that for a municipality to be
converted into a component city, it must,
among others, have an average annual income
of at least Twenty Million Pesos for the last
two (2) consecutive years based on 1991
constant prices.1 Such income must be duly
certified by the Department of Finance.
A Local Government Unit is a political
subdivision of the State which is constituted
by law and possessed of substantial control
over its own affairs.3 Remaining to be an intra
sovereign subdivision of one sovereign nation,
but not intended, however, to be an imperium
in imperio,4 the local government unit is
autonomous in the sense that it is given more
powers, authority, responsibilities and
resources.5 Power which used to be highly
centralized in Manila, is thereby
deconcentrated, enabling especially the
peripheral local government units to develop
not only at their own pace and discretion but
also with their own resources and assets.
The practical side to development through a
decentralized local government system
certainly concerns the matter of financial
resources. With its broadened powers and
increased responsibilities, a local government
unit must now operate on a much wider scale.
More extensive operations, in turn, entail more
expenses. Understandably, the vesting of duty,
responsibility and accountability in every local
government unit is accompanied with a
provision for reasonably adequate resources to
discharge its powers and effectively carry out
its functions.7 Availment of such resources is
effectuated through the vesting in every local
government unit of (1) the right to create and
broaden its own source of revenue; (2) the
right to be allocated a just share in national
taxes, such share being in the form of internal
revenue allotments (IRAs); and (3) the right to
be given its equitable share in the proceeds of
the utilization and development of the
national wealth, if any, within its territorial
boundaries.8.
The funds generated from local taxes, IRAs
and national wealth utilization proceeds
accrue to the general fund of the local
government and are used to finance its
operations subject to specified modes of
spending the same as provided for in the Local
Government Code and its implementing rules
and regulations. For instance, not less than
twenty percent (20%) of the IRAs must be set
aside for local development projects.9 As such,
for purposes of budget preparation, which
budget should reflect the estimates of the
income of the local government unit, among
others, the IRAs and the share in the national
wealth utilization proceeds are considered
items of income. This is as it should be, since
income is defined in the Local Government
Code to be all revenues and receipts collected
or received forming the gross accretions of
funds of the local government unit
For purposes of converting the Municipality of
Santiago into a city, the Department of Finance
certified, among others, that the municipality
had an average annual income of at least
Twenty Million Pesos for the last two (2)
consecutive years based on 1991 constant
prices. This, the Department of Finance did
after including the IRAs in its computation of
said average annual income.
Furthermore, Section 450 (c) of the Local
Government Code provides that the average
annual income shall include the income
accruing to the general fund, exclusive of
special funds, transfers, and non-recurring
income. To reiterate, IRAs are a regular,
recurring item of income; nil is there a basis,
too, to classify the same as a special fund or
transfer, since IRAs have a technical definition
and meaning all its own as used in the Local
Government Code that unequivocally makes it
distinct from special funds or transfers
referred to when the Code speaks of funding
support from the national government, its
instrumentalities and government-owned-or-
controlled corporations.
Thus, Department of Finance Order No.
359313 correctly encapsulizes the full import
of the above disquisition when it defined
ANNUAL INCOME to be revenues and
receipts realized by provinces, cities and
municipalities from regular sources of the
Local General Fund including the internal
revenue allotment and other shares provided
for in Sections 284, 290 and 291 of the Code,
but exclusive of non-recurring receipts, such
as other national aids, grants, financial
assistance, loan proceeds, sales of fixed assets,
and similar others (Italics ours).14 Such order,
constituting executive or contemporaneous
construction of a statute by an administrative
agency charged with the task of interpreting
and applying the same, is entitled to full
respect and should be accorded great weight
by the courts, unless such construction is
clearly shown to be in sharp conflict with the
Constitution, the governing statute, or other
laws
LOCAL AUTONOMY EXPLAINED
Pimentel vs. Aguirre
FACTS: Before us is an original Petition for
Certiorari and Prohibition seeking (1) to annul
Section 1 of Administrative Order (AO) No.
372, insofar as it requires local government
units to reduce their expenditures by 25
percent of their authorized regular
appropriations for non-personal services; and
(2) to enjoin respondents from implementing
Section 4 of the Order, which withholds a
portion of their internal revenue allotments.
Petitioner contends that the President, in
issuing AO 372, was in effect exercising the
power of control over LGUs. The Constitution
vests in the President, however, only the
power of general supervision over LGUs,
consistent with the principle of local
autonomy. Petitioner further argues that the
directive to withhold ten percent (10%) of their
IRA is in contravention of Section 286 of the
Local Government Code and of Section 6,
Article X of the Constitution, providing for the
automatic release to each of these units its
share in the national internal revenue.
The solicitor general, on behalf of the
respondents, claims on the other hand that AO
372 was issued to alleviate the "economic
difficulties brought about by the peso
devaluation" and constituted merely an
exercise of the President's power of
supervision over LGUs. It allegedly does not
violate local fiscal autonomy, because it
merely directs local governments to identify
measures that will reduce their total
expenditures for non-personal services by at
least 25 percent. Likewise, the withholding of
10 percent of the LGUs IRA does not violate
the statutory prohibition on the imposition of
any lien or holdback on their revenue shares,
because such withholding is "temporary in
nature pending the assessment and evaluation
by the Development Coordination Committee
of the emerging fiscal situation."
ISSUE: W/N the AO violates the local
autonomy of the LGUs as provided by the
Constitution
RULING: YES, insofar is the withholding of
the IRA is concerned it is unconstitutional
but the 25% reduction is constitutional
because it is simply advisory in nature
Section 4, Article X of the Consitution: The
President of the Philippines shall exercise
general supervision over local governments.
In administrative law, supervision means
overseeing or the power or authority of an
officer to see that subordinate officers perform
their duties. If the latter fail or neglect to fulfill
them, the former may take such action or step
as prescribed by law to make them perform
their duties. Control, on the other hand, means
the power of an officer to alter or modify or
nullify or set aside what a subordinate officer
ha[s] done in the performance of his duties
and to substitute the judgment of the former
for that of the latter.
Jurisprudence Drilon vs. Lim: he difference
between control and supervision was further
delineated. Officers in control lay down the
rules in the performance or accomplishment of
an act. If these rules are not followed, they
may, in their discretion, order the act undone
or redone by their subordinates or even decide
to do it themselves. On the other hand,
supervision does not cover such authority.
Supervising officials merely see to it that the
rules are followed, but they themselves do not
lay down such rules, nor do they have the
discretion to modify or replace them. If the
rules are not observed, they may order the
work done or redone, but only to conform to
such rules. They may not prescribe their own
manner of execution of the act. They have no
discretion on this matter except to see to it that
the rules are followed.
Under the Philippine concept of local
autonomy, the national government has not
completely relinquished all its powers over
local governments, including autonomous
regions. Only administrative powers over
local affairs are delegated to political
subdivisions. The purpose of the delegation is
to make governance more directly responsive
and effective at the local levels. In turn,
economic, political and social development at
the smaller political units are expected to
propel social and economic growth and
development. But to enable the country to
develop as a whole, the programs and policies
effected locally must be integrated and
coordinated towards a common national goal.
Thus, policy-setting for the entire country still
lies in the President and Congress. As we
stated in Magtajas v. Pryce Properties Corp.,
Inc., municipal governments are still agents of
the national government.
Under existing law, local government units, in
addition to having administrative autonomy
in the exercise of their functions, enjoy fiscal
autonomy as well. Fiscal autonomy means that
local governments have the power to create
their own sources of revenue in addition to
their equitable share in the national taxes
released by the national government, as well
as the power to allocate their resources in
accordance with their own priorities. It
extends to the preparation of their budgets,
and local officials in turn have to work within
the constraints thereof. They are not
formulated at the national level and imposed
on local governments, whether they are
relevant to local needs and resources or not.
Hence, the necessity of a balancing of
viewpoints and the harmonization of
proposals from both local and national
officials, who in any case are partners in the
attainment of national goals.
Local fiscal autonomy does not however rule
out any manner of national government
intervention by way of supervision, in order to
ensure that local programs, fiscal and
otherwise, are consistent with national goals.
Significantly, the President, by constitutional
fiat, is the head of the economic and planning
agency of the government, primarily
responsible for formulating and implementing
continuing, coordinated and integrated social
and economic policies, plans and
programs[26] for the entire country. However,
under the Constitution, the formulation and
the implementation of such policies and
programs are subject to "consultations with
the appropriate public agencies, various
private sectors, and local government units."
The President cannot do so unilaterally.
There are therefore several requisites before
the President may interfere in local fiscal
matters: (1) an unmanaged public sector
deficit of the national government; (2)
consultations with the presiding officers of the
Senate and the House of Representatives and
the presidents of the various local leagues; and
(3) the corresponding recommendation of the
secretaries of the Department of Finance,
Interior and Local Government, and Budget
and Management. Furthermore, any
adjustment in the allotment shall in no case be
less than thirty percent (30%) of the collection
of national internal revenue taxes of the third
fiscal year preceding the current one.
While the wordings of Section 1 of AO 372
have a rather commanding tone, and while we
agree with petitioner that the requirements of
Section 284 of the Local Government Code
have not been satisfied, we are prepared to
accept the solicitor general's assurance that the
directive to "identify and implement measures
x x x that will reduce total expenditures x x x
by at least 25% of authorized regular
appropriation" is merely advisory in character,
and does not constitute a mandatory or
binding order that interferes with local
autonomy.
Section 4 of AO 372 cannot, however, be
upheld. A basic feature of local fiscal
autonomy is the automatic release of the
shares of LGUs in the national internal
revenue. This is mandated by no less than the
Constitution. The Local Government Code
specifies further that the release shall be made
directly to the LGU concerned within five (5)
days after every quarter of the year and "shall
not be subject to any lien or holdback that may
be imposed by the national government for
whatever purpose." As a rule, the term "shall"
is a word of command that must be given a
compulsory meaning. The provision is,
therefore, imperative.
Section 4 of AO 372, however, orders the
withholding, effective January 1, 1998, of 10
percent of the LGUs' IRA "pending the
assessment and evaluation by the
Development Budget Coordinating
Committee of the emerging fiscal situation" in
the country. Such withholding clearly
contravenes the Constitution and the law.
Although temporary, it is equivalent to a
holdback, which means "something held back
or withheld, often temporarily." Hence, the
"temporary" nature of the retention by the
national government does not matter. Any
retention is prohibited.
In sum, while Section 1 of AO 372 may be
upheld as an advisory effected in times of
national crisis, Section 4 thereof has no color of
validity at all. The latter provision effectively
encroaches on the fiscal autonomy of local
governments. Concededly, the President was
well-intentioned in issuing his Order to
withhold the LGUs IRA, but the rule of law
requires that even the best intentions must be
carried out within the parameters of the
Constitution and the law. Verily, laudable
purposes must be carried out by legal
methods.
Province of Batangas vs. Romulo
FACTS: The petitioner now comes to this
Court assailing as unconstitutional and void
the provisos in the GAAs of 1999, 2000 and
2001, relating to the LGSEF. Similarly assailed
are the Oversight Committees Resolutions
Nos. OCD-99-003, OCD-99-005, OCD-99-006,
OCD-2000-023, OCD-2001-029 and OCD-2002-
001 issued pursuant thereto. The petitioner
submits that the assailed provisos in the GAAs
and the OCD resolutions, insofar as they
earmarked the amount of five billion pesos of
the IRA of the LGUs for 1999, 2000 and 2001
for the LGSEF and imposed conditions for the
release thereof, violate the Constitution and
the Local Government Code of 1991.
Section 6, Article X of the Constitution is
invoked as it mandates that the just share of
the LGUs shall be automatically released to
them. Sections 18 and 286 of the Local
Government Code of 1991, which enjoin that
the just share of the LGUs shall be
automatically and directly released to them
without need of further action are, likewise,
cited.
The petitioner posits that to subject the
distribution and release of the five-billion-peso
portion of the IRA, classified as the LGSEF, to
compliance by the LGUs with the
implementing rules and regulations, including
the mechanisms and guidelines prescribed by
the Oversight Committee, contravenes the
explicit directive of the Constitution that the
LGUs share in the national taxes shall be
automatically released to them. The petitioner
maintains that the use of the word shall must
be given a compulsory meaning.
To further buttress this argument, the
petitioner contends that to vest the Oversight
Committee with the authority to determine the
distribution and release of the LGSEF, which is
a part of the IRA of the LGUs, is an anathema
to the principle of local autonomy as
embodied in the Constitution and the Local
Government Code of 1991. The petitioner cites
as an example the experience in 2001 when the
release of the LGSEF was long delayed
because the Oversight Committee was not able
to convene that year and no guidelines were
issued therefor. Further, the possible
disapproval by the Oversight Committee of
the project proposals of the LGUs would result
in the diminution of the latters share in the
IRA.
Another infringement alleged to be occasioned
by the assailed OCD resolutions is the
improper amendment to Section 285 of the
Local Government Code of 1991 on the
percentage sharing of the IRA among the
LGUs. Said provision allocates the IRA as
follows: Provinces 23%; Cities 23%;
Municipalities 34%; and Barangays 20%.[8]
This formula has been improperly amended or
modified, with respect to the five-billion-peso
portion of the IRA allotted for the LGSEF, by
the assailed OCD resolutions as they
invariably provided for a different sharing
scheme.
The modifications allegedly constitute an
illegal amendment by the executive branch of
a substantive law. Moreover, the petitioner
mentions that in the Letter dated December 5,
2001 of respondent Executive Secretary
Romulo addressed to respondent Secretary
Boncodin, the former endorsed to the latter the
release of funds to certain LGUs from the
LGSEF in accordance with the handwritten
instructions of President Arroyo. Thus, the
LGUs are at a loss as to how a portion of the
LGSEF is actually allocated. Further, there are
still portions of the LGSEF that, to date, have
not been received by the petitioner; hence,
resulting in damage and injury to the
petitioner.
The respondents, through the Office of the
Solicitor General, urge the Court to dismiss the
petition on procedural and substantive
grounds. On the latter, the respondents
contend that the assailed provisos in the GAAs
of 1999, 2000 and 2001 and the assailed
resolutions issued by the Oversight
Committee are not constitutionally infirm. The
respondents advance the view that Section 6,
Article X of the Constitution does not specify
that the just share of the LGUs shall be
determined solely by the Local Government
Code of 1991. Moreover, the phrase as
determined by law in the same constitutional
provision means that there exists no limitation
on the power of Congress to determine what is
the just share of the LGUs in the national
taxes. In other words, Congress is the arbiter
of what should be the just share of the LGUs
in the national taxes.
The respondents further theorize that Section
285 of the Local Government Code of 1991,
which provides for the percentage sharing of
the IRA among the LGUs, was not intended to
be a fixed determination of their just share in
the national taxes. Congress may enact other
laws, including appropriations laws such as
the GAAs of 1999, 2000 and 2001, providing
for a different sharing formula. Section 285 of
the Local Government Code of 1991 was
merely intended to be the default share of the
LGUs to do away with the need to determine
annually by law their just share. However, the
LGUs have no vested right in a permanent or
fixed percentage as Congress may increase or
decrease the just share of the LGUs in
accordance with what it believes is
appropriate for their operation. There is
nothing in the Constitution which prohibits
Congress from making such determination
through the appropriations laws. If the
provisions of a particular statute, the GAA in
this case, are within the constitutional power
of the legislature to enact, they should be
sustained whether the courts agree or not in
the wisdom of their enactment.
ISSUE: W/N the assailed rules violates the
constitution
RULING: YES, it violates the precept of local
autonomy
Section 6, Article X of the Constitution reads:
Sec. 6. Local government units shall have a just
share, as determined by law, in the national
taxes which shall be automatically released to
them.
When parsed, it would be readily seen that
this provision mandates that (1) the LGUs
shall have a just share in the national taxes; (2)
the just share shall be determined by law; and
(3) the just share shall be automatically
released to the LGUs
Further, the word automatically is defined as
in an automatic manner: without thought or
conscious intention. Being automatic, thus,
connotes something mechanical, spontaneous
and perfunctory. As such, the LGUs are not
required to perform any act to receive the just
share accruing to them from the national
coffers. As emphasized by the Local
Government Code of 1991, the just share of the
LGUs shall be released to them without need
of further action.
The just share of the LGUs is incorporated as
the IRA in the appropriations law or GAA
enacted by Congress annually. Under the
assailed provisos in the GAAs of 1999, 2000
and 2001, a portion of the IRA in the amount
of five billion pesos was earmarked for the
LGSEF, and these provisos imposed the
condition that such amount shall be released
to the local government units subject to the
implementing rules and regulations, including
such mechanisms and guidelines for the
equitable allocations and distribution of said
fund among local government units subject to
the guidelines that may be prescribed by the
Oversight Committee on Devolution. Pursuant
thereto, the Oversight Committee, through the
assailed OCD resolutions, apportioned the five
billion pesos LGSEF.
Significantly, the LGSEF could not be released
to the LGUs without the Oversight
Committees prior approval. Further, with
respect to the portion of the LGSEF allocated
for various projects of the LGUs (P1 billion for
1999; P1.5 billion for 2000 and P2 billion for
2001), the Oversight Committee, through the
assailed OCD resolutions, laid down
guidelines and mechanisms that the LGUs had
to comply with before they could avail of
funds from this portion of the LGSEF. The
guidelines required (a) the LGUs to identify
the projects eligible for funding based on the
criteria laid down by the Oversight
Committee; (b) the LGUs to submit their
project proposals to the DILG for appraisal; (c)
the project proposals that passed the appraisal
of the DILG to be submitted to the Oversight
Committee for review, evaluation and
approval. It was only upon approval thereof
that the Oversight Committee would direct the
DBM to release the funds for the projects.
To the Courts mind, the entire process
involving the distribution and release of the
LGSEF is constitutionally impermissible. The
LGSEF is part of the IRA or just share of the
LGUs in the national taxes. To subject its
distribution and release to the vagaries of the
implementing rules and regulations, including
the guidelines and mechanisms unilaterally
prescribed by the Oversight Committee from
time to time, as sanctioned by the assailed
provisos in the GAAs of 1999, 2000 and 2001
and the OCD resolutions, makes the release
not automatic, a flagrant violation of the
constitutional and statutory mandate that the
just share of the LGUs shall be automatically
released to them. The LGUs are, thus, placed
at the mercy of the Oversight Committee.
Indeed, the Oversight Committee exercising
discretion, even control, over the distribution
and release of a portion of the IRA, the LGSEF,
is an anathema to and subversive of the
principle of local autonomy as embodied in
the Constitution. Moreover, it finds no
statutory basis at all as the Oversight
Committee was created merely to formulate
the rules and regulations for the efficient and
effective implementation of the Local
Government Code of 1991 to ensure
compliance with the principles of local
autonomy as defined under the Constitution.
Section 284 of the Local Government Code
provides that, beginning the third year of its
effectivity, the LGUs share in the national
internal revenue taxes shall be 40%. This
percentage is fixed and may not be reduced
except in the event the national government
incurs an unmanageable public sector deficit"
and only upon compliance with stringent
requirements set forth in the same section
However, this percentage sharing is not
followed with respect to the five billion pesos
LGSEF as the assailed OCD resolutions,
implementing the assailed provisos in the
GAAs of 1999, 2000 and 2001, provided for a
different sharing scheme. For example, for
1999, P2 billion of the LGSEF was allocated as
follows: Provinces 40%; Cities 20%;
Municipalities 40%. For 2000, P3.5 billion of
the LGSEF was allocated in this manner:
Provinces 26%; Cities 23%; Municipalities 35%;
Barangays 26%. For 2001, P3 billion of the
LGSEF was allocated, thus: Provinces 25%;
Cities 25%; Municipalities 35%; Barangays
15%
A general appropriations bill is a special type
of legislation, whose content is limited to
specified sums of money dedicated to a
specific purpose or a separate fiscal unit. Any
provision therein which is intended to amend
another law is considered an inappropriate
provision. The category of inappropriate
provisions includes unconstitutional
provisions and provisions which are intended
to amend other laws, because clearly these
kinds of laws have no place in an
appropriations bill.
Increasing or decreasing the IRA of the LGUs
or modifying their percentage sharing therein,
which are fixed in the Local Government Code
of 1991, are matters of general and substantive
law. To permit Congress to undertake these
amendments through the GAAs, as the
respondents contend, would be to give
Congress the unbridled authority to unduly
infringe the fiscal autonomy of the LGUs, and
thus put the same in jeopardy every year. This,
the Court cannot sanction.
Sampiano vs. Indar
FACTS: This administrative case against
respondent Judge Cader P. Indar of the
Regional Trial Court (RTC), Branch 12,
Malabang, Lanao del Sur stemmed from a
complaint filed by Hadji Amer R. Sampiano
(Sampiano), incumbent Mayor, and the
members of the Sangguniang Bayan of the
Municipality of Balabagan, Lanao del Sur,
charging said judge with gross and wanton
ignorance of the law, grave abuse of authority,
manifest partiality and serious acts of
impropriety in connection with the issuance of
an Order dated October 11, 2004 in Special
Civil Action (SCA) No. 12-173, entitled
Sumulong Sampiano Ogka (Ogka) v.
Philippine National Bank(PNB)-Marawi
Branch, represented by its Branch Manager
Sandorie T. Disomangcop (Disomangcop),
Atty. Alvin C. Go (Go), Hadji Amer Sampiano
and Mamarinta Macabato (Macabato), for
Prohibition and Injunction with Temporary
Restraining Order (TRO) and Preliminary
Injunction.
Prior to the filing of the present administrative
case, complainant Sampiano filed before the
Commission on Elections (Comelec) a Petition
for Annulment of Proclamation with Prayer
for Preliminary Injunction/TRO against his
rival mayoralty candidate, his uncle Ogka, and
the Municipal Board of Canvassers of
Balabagan, Lanao del Sur composed of Vadria
Pungginagina and Zenaida Mante.
Aggrieved, Ogka filed, on September 13, 2004,
an Urgent Motion for Reconsideration of the
September 9, 2004 Order.[8] He also informed
in writing, the Chief Legal Counsel of PNB,
Atty. Alvin C. Go, and asked him not to
release the IRA (Internal Revenue Allotment
which is the share of the local government unit
in national internal revenue taxes) for the
Municipality of Balabagan, Lanao del Sur until
the controversy involving the mayorship of
the said municipality now pending with the
Comelec shall have been finally resolved. He
cited Section 2, Rule 19 of the Comelec Rules
of Procedure which provides that a motion for
reconsideration, if not pro-forma, suspends
the execution or implementation of the
decision, resolution, order or ruling. However,
on the basis of the Comelec Order dated
September 9, 2004, Go directed PNB-Marawi
to release the July, August, and September
2004 IRA for the Municipality of Balabagan,
Lanao del Sur to Sampiano and Macabato (the
Municipal Treasurer). In turn, PNB-Marawi
acting through its manager, Disomangcop,
released on September 14, 2004 the pending
IRA for the months of July to September 2004.
To temporarily suspend the release by the
PNB-Marawi of the October 2004 IRA while
his Urgent Motion for Reconsideration of the
September 9, 2004 Order of the Comelec is
pending resolution, Ogka filed on October 11,
2004, a special civil action for Prohibition and
Injunction with TRO and Preliminary
Injunction, docketed as SCA No. 12-173, with
the RTC, Branch 12, Malabang, Lanao del Sur
presided over by herein respondent Judge.
On the same day, respondent Judge issued an
Order setting the hearing of the petition on
October 14, 2004. He likewise directed,
pending resolution of the said petition, the
PNB-Marawi (represented by Disomangcop
and Go) to hold or defer the release of the IRA
for the Municipality of Balabagan unless
ordered otherwise by the court
Sampiano further claimed that the said Order
was issued in violation of Section 286 of the
Local Government Code (LGC), which
provides for the automatic release of the share
of the local government unit from the national
government
OCA found him guilty for gross ignorance of
the law
ISSUE: W/N Ogka is entitled to the issuance
of a TRO or an injunction and not the
application or enforcement of election law.
RULING: YES, he is entitled to the TRO
We agree with respondent Judge that the
automatic release of the IRA under Section 286
is a mandate to the national government
through the Department of Budget and
Management to effect automatic release of the
said funds from the treasury directly to the
local government unit, free from any
holdbacks or liens imposed by the national
government. However, this automatic release
of the IRA from the national treasury does not
prevent the proper court from deferring or
suspending the release thereof to particular
local officials when there is a legal question
presented in the court pertaining to the rights
of the parties to receive the IRA or to the
propriety of the issuance of a TRO or a
preliminary injunction while such rights are
still being determined.
A cursory reading of the said Order reveals
that it was in effect a TRO or preliminary
injunction order. The Order directed PNBs Go
and Disomangcop to hold or defer the release
of the IRA to Sampiano and Macabato while
the petition is pending resolution of the trial
court and unless ordered otherwise by the
court.
The above-quoted provisions expressly
prohibit the grant of preliminary injunction
without hearing and prior notice to the party
or person sought to be enjoined. However,
courts are authorized to issue ex parte a TRO
effective only for seventy-two (72) hours if it
should appear from the facts shown by
affidavits or by the verified petition that great
or irreparable injury would result to the
applicant before the matter could be heard on
notice. Within the aforesaid period of time, the
Court should conduct a summary hearing to
determine if a TRO shall be issued. The TRO,
however, shall be effective only for a period of
twenty (20) days from notice to the party or
person sought to be enjoined. During the 20-
day period, the judge must conduct a hearing
to consider the propriety of issuing a
preliminary injunction. At the end of such
period, the TRO automatically terminates
without need of any judicial declaration to that
effect, leaving the court no discretion to extend
the same.
Here, respondent Judge issued the October 11,
2004 Order on the very same day it was filed,
and without any hearing and prior notice to
herein complainants. As discussed above,
respondent was allowed by the Rules to issue
ex parte a TRO of limited effectivity and, in
that time, conduct a hearing to determine the
propriety of extending the TRO or issuing a
writ of preliminary injunction.
Respondent conducted the hearing of the
petition on October 14, 2004 or on the third
day of the issuance of a TRO ex parte.
It is worthy to note that the said October 11,
2004 Order was subsequently lifted by the
succeeding judge on the ground that the
requisites for issuance of a writ of preliminary
injunction were not present.
However, Sampiano adduced no evidence to
prove that the issuance of the October 11, 2004
Order was motivated by bad faith. Bad faith
does not simply connote bad judgment or
negligence; it imputes a dishonest purpose or
some moral obliquity and conscious doing of a
wrong; a breach of a sworn duty through
some motive or intent or ill-will; it partakes of
the nature of fraud. It contemplates a state of
mind affirmatively operating with furtive
design or some motive of self-interest or ill-
will for ulterior purposes. Evident bad faith
connotes a manifest deliberate intent on the
part of the accused to do wrong or cause
damage. In issuing the assailed Order,
respondent Judge was not at all motivated by
bad faith, dishonesty, hatred and some other
motive; rather, he took into account the
circumstances obtaining between the parties
as can be gleaned from his Comment.
Pimentel vs. Ochoa
FACTS: In 2007, the DSWD embarked on a
poverty reduction strategy with the poorest of
the poor as target beneficiaries. Dubbed "Ahon
Pamilyang Pilipino,"
On July 16, 2008, the DSWD issued
Administrative Order No. 16, series of 2008
(A.O. No. 16, s. 2008), setting the
implementing guidelines for the project
renamed "Pantawid Pamilyang Pilipino
Program" (4Ps)
This government intervention scheme, also
conveniently referred to as CCTP, "provides
cash grant to extreme poor households to
allow the members of the families to meet
certain human development goals."
Eligible households that are selected from
priority target areas consisting of the poorest
provinces classified by the National Statistical
Coordination Board (NCSB) are granted a
health assistance of P500.00/month, or
P6,000.00/year, and an educational assistance
of P300.00/month for 10 months, or a total of
P3,000.00/year, for each child but up to a
maximum of three children per family.9 Thus,
after an assessment on the appropriate
assistance package, a household beneficiary
could receive from the government an annual
subsidy for its basic needs up to an amount of
P15,000.00
Congress, for its part, sought to ensure the
success of the CCTP by providing it with
funding under the GAA of 2008 in the amount
of Two Hundred Ninety-Eight Million Five
Hundred Fifty Thousand Pesos
(P298,550,000.00). This budget allocation
increased tremendously to P5 Billion Pesos in
2009, with the amount doubling to P10 Billion
Pesos in 2010. But the biggest allotment given
to the CCTP was in the GAA of 2011 at
Twenty One Billion One Hundred Ninety-
Four Million One Hundred Seventeen
Thousand Pesos (P21,194,117,000.00).
Petitioner Aquilino Pimentel, Jr., a former
Senator, joined by Sergio Tadeo, incumbent
President of the Association of Barangay
Captains of Cabanatuan City, Nueva Ecija,
and Nelson Alcantara, incumbent Barangay
Captain of Barangay Sta. Monica, Quezon
City, challenges before the Court the
disbursement of public funds and the
implementation of the CCTP which are
alleged to have encroached into the local
autonomy of the LGUs.
ISSUE: W/N the challenged rule encroached
the local autonomy of the LGUs
RULING:
Section 3. The Congress shall enact a local
government code which shall provide for a
more responsive and accountable local
government structure instituted through a
system of decentralization with effective
mechanisms of recall, initiative, and
referendum, allocate among the different local
government units their powers,
responsibilities, and resources, and provide
for the qualifications, election, appointment
and removal, term, salaries, powers and
functions and duties of local officials, and all
other matters relating to the organization and
operation of the local units.
In order to fully secure to the LGUs the
genuine and meaningful autonomy that
would develop them into self-reliant
communities and effective partners in the
attainment of national goals,16 Section 17 of
the Local Government Code vested upon the
LGUs the duties and functions pertaining to
the delivery of basic services and facilities, as
follows:
SECTION 17. Basic Services and Facilities.
(a) Local government units shall endeavor to
be self-reliant and shall continue exercising the
powers and discharging the duties and
functions currently vested upon them. They
shall also discharge the functions and
responsibilities of national agencies and offices
devolved to them pursuant to this Code. Local
government units shall likewise exercise such
other powers and discharge such other
functions and responsibilities as are necessary,
appropriate, or incidental to efficient and
effective provision of the basic services and
facilities enumerated herein.
(b) Such basic services and facilities include,
but are not limited to, x x x.
While the aforementioned provision charges
the LGUs to take on the functions and
responsibilities that have already been
devolved upon them from the national
agencies on the aspect of providing for basic
services and facilities in their respective
jurisdictions, paragraph (c) of the same
provision provides a categorical exception of
cases involving nationally-funded projects,
facilities, programs and services, thus:
(c) Notwithstanding the provisions of
subsection (b) hereof, public works and
infrastructure projects and other facilities,
programs and services funded by the National
Government under the annual General
Appropriations Act, other special laws,
pertinent executive orders, and those wholly
or partially funded from foreign sources, are
not covered under this Section, except in those
cases where the local government unit
concerned is duly designated as the
implementing agency for such projects,
facilities, programs and services.
The essence of this express reservation of
power by the national government is that,
unless an LGU is particularly designated as
the implementing agency, it has no power
over a program for which funding has been
provided by the national government under
the annual general appropriations act, even if
the program involves the delivery of basic
services within the jurisdiction of the LGU.
The Court held in Ganzon v. Court of Appeals
that while it is through a system of
decentralization that the State shall promote a
more responsive and accountable local
government structure, the concept of local
autonomy does not imply the conversion of
local government units into "mini-states." We
explained that, with local autonomy, the
Constitution did nothing more than "to break
up the monopoly of the national government
over the affairs of the local government" and,
thus, did not intend to sever "the relation of
partnership and interdependence between the
central administration and local government
units." In Pimentel v. Aguirre, the Court
defined the extent of the local government's
autonomy in terms of its partnership with the
national government in the pursuit of
common national goals, referring to such key
concepts as integration and coordination
Under the Philippine concept of local
autonomy, the national government has not
completely relinquished all its powers over
local governments, including autonomous
regions. Only administrative powers over
local affairs are delegated to political
subdivisions. The purpose of the delegation is
to make governance more directly responsive
and effective at the local levels. In turn,
economic, political and social development at
the smaller political units are expected to
propel social and economic growth and
development. But to enable the country to
develop as a whole, the programs and policies
effected locally must be integrated and
coordinated towards a common national goal.
Thus, policy-setting for the entire country still
lies in the President and Congress.
Now, autonomy is either decentralization of
administration or decentralization of
power.1wphi1 There is decentralization of
administration when the central government
delegates administrative powers to political
subdivisions in order to broaden the base of
government power and in the process to make
local governments more responsive and
accountable and ensure their fullest
development as self-reliant communities and
make them more effective partners in the
pursuit of national development and social
progress. At the same time, it relieves the
central government of the burden of managing
local affairs and enables it to concentrate on
national concerns. The President exercises
general supervision over them, but only to
ensure that local affairs are administered
according to law. He has no control over their
acts in the sense that he can substitute their
judgments with his own.
Decentralization of power, on the other hand,
involves an abdication of political power in
the [sic] favor of local governments [sic] units
declared to be autonomous. In that case, the
autonomous government is free to chart its
own destiny and shape its future with
minimum intervention from central
authorities. According to a constitutional
author, decentralization of power amounts to
self-immolation, since in that event, the
autonomous government becomes
accountable not to the central authorities but
to its constituency.
Indeed, a complete relinquishment of central
government powers on the matter of
providing basic facilities and services cannot
be implied as the Local Government Code
itself weighs against it. The national
government is, thus, not precluded from
taking a direct hand in the formulation and
implementation of national development
programs especially where it is implemented
locally in coordination with the LGUs
concerned.
Villafuerte Jr. vs. Robredo
FACTS: In 1995, the Commission on Audit
(COA) conducted an examination and audit
on the manner the local government units
(LGUs) utilized their Internal Revenue
Allotment (IRA) for the calendar years 1993-
1994. The examination yielded an official
report, showing that a substantial portion of
the 20% development fund of some LGUs was
not actually utilized for development projects
but was diverted to expenses properly
chargeable against the Maintenance and Other
Operating Expenses (MOOE), in stark
violation of Section 287 of R.A. No. 7160,
otherwise known as the Local Government
Code of 1991 (LGC). Thus, on December 14,
1995, the DILG issued MC No. 95-216,5
enumerating the policies and guidelines on the
utilization of the development fund
component of the IRA. It likewise carried a
reminder to LGUs of the strict mandate to
ensure that public funds, like the 20%
development fund, "shall bespent judiciously
and only for the very purpose or purposes for
which such funds are intended."
On August 31, 2010, the respondent, in his
capacity as DILG Secretary, issued the assailed
MC No. 2010-83, entitled "Full Disclosure of
Local Budget and Finances, and Bids and
Public Offerings," which aims to promote
good governance through enhanced
transparency and accountability of LGUs.
On December 2, 2010, the respondent issued
MC No. 2010-138,11 reiterating that 20%
component of the IRA shall be utilized for
desirable social, economic and environmental
outcomes essential to the attainment of the
constitutional objective of a quality oflife for
all.
The petitioners argue that the assailed
issuances of the respondent interfere with the
local and fiscal autonomy of LGUs embodied
in the Constitution and the LGC. In particular,
they claim that MC No. 2010-138 transgressed
these constitutionally-protected liberties when
it restricted the meaning of "development" and
enumerated activities which the local
government must finance from the 20%
development fund component of the IRA and
provided sanctions for local authorities who
shall use the said component of the fund for
the excluded purposes stated therein.33 They
argue that the respondent cannot substitute
his own discretion with that of the local
legislative council in enacting its annual
budget and specifying the development
projects that the 20% component of its IRA
should fund.
ISSUE: W/N the assailed rule violates the
local and fiscal autonomy of LGUs
RULING: NO, it does not violate the local
and fiscal autonomy of LGUs for the
memorandum circulars are mere advisory
and reminder of what is worded in LGC Sec.
287
[A]utonomy is either decentralization of
administration ordecentralization of power.
There is decentralization of administration
when the central government delegates
administrative powers to political
subdivisions in order to broaden the base of
government power and in the process to make
local governments "more responsive and
accountable," and "ensure their fullest
development as self-reliant communities and
make them more effective partners in the
pursuit of national development and social
progress." At the same time, it relieves the
central government of the burden of managing
local affairs and enables it to concentrate on
national concerns. x x x. Decentralization of
power, on the other hand, involves an
abdication of political power in the favor of
local governments [sic] units declared to be
autonomous. In thatcase, the autonomous
government is free to chart its own destiny
and shape its future with minimum
intervention from central authorities.
A reading of MC No. 2010-138 shows that it is
a mere reiteration of an existing provision in
the LGC. It was plainly intended to remind
LGUs to faithfully observe the directive stated
in Section 287 of the LGC to utilize the 20%
portion of the IRA for development projects. It
was, at best, an advisory to LGUs to examine
themselves if they have been complying with
the law. It must be recalled that the assailed
circular was issued in response to the report of
the COA that a substantial portion of the 20%
development fund of some LGUs was not
actually utilized for development projects but
was diverted to expenses more properly
categorized as MOOE, in violation of Section
287 of the LGC. This intention was highlighted
in the very first paragraph of MC No. 2010-138
That the term developmentwas characterized
asthe "realization of desirable social, economic
and environmental outcome" does not operate
as a restriction of the term so as to exclude
some other activities that may bring about the
same result. The definition was a plain
characterization of the concept of development
as it is commonly understood. The statement
of a general definition was only necessary to
illustrate among LGUs the nature of expenses
that are properly chargeable against the
development fund component of the IRA. It is
expected to guide them and aid them in
rethinking their ways so that they may be able
to rectify lapses in judgment, should there be
any, or it may simply stand as a reaffirmation
of an already proper administration of
expenses.
The petitioners should be reminded that the
issuance of MC No. 2010-138 was brought
about by the report of the COA that the
development fund was not being utilized
accordingly. To curb the alleged misuse of the
development fund, the respondent deemed it
proper to remind LGUs of the nature and
purpose of the provision for the IRA through
MC No. 2010-138.
Contrary to the petitioners posturing,
however, the enumeration was not meant to
restrict the discretion of the LGUs in the
utilization of their funds. It was meant to
enlighten LGUs as to the nature of the
development fund by delineating it from other
types of expenses. It was incorporated in the
assailed circular in order to guide them in the
proper disposition of the IRA and avert
further misuse of the fund by citing current
practices which seemed to be incompatible
with the purpose of the fund. Even then, LGUs
remain at liberty to map out their respective
development plans solely on the basis of their
own judgment and utilize their IRAs
accordingly, with the only restriction that 20%
thereof be expended for development projects.
They may even spend their IRAs for some of
the enumerated items should they partake of
indirect costs of undertaking development
projects. In such case, however, the concerned
LGU must ascertain that applicable rules and
regulations on budgetary allocation have been
observed lest it be inviting an administrative
probe.
Significantly, the issuance itself did not
provide for sanctions. It did not particularly
establish a new set ofacts or omissions which
are deemed violations and provide the
corresponding penalties therefor. It simply
stated a reminder to LGUs that there are
existing rules to consider in the disbursement
of the 20% development fund and that non-
compliance therewith may render them liable
to sanctions which are provided in the LGC
and other applicable laws.
Autonomy, however, is not meant to end the
relation of partnership and interdependence
between the central administration and local
government units, or otherwise, to usher in a
regime of federalism. The Charter has not
taken such a radical step.1avvphi1 Local
governments, under the Constitution, are
subject to regulation, however limited, and for
no other purpose than precisely, albeit
paradoxically, to enhance self-government.
Thus, notwithstanding the local fiscal
autonomy being enjoyed by LGUs, they are
still under the supervision of the President
and maybe held accountable for malfeasance
or violations of existing laws. "Supervision is
not incompatible with discipline. And the
power to discipline and ensure that the laws
be faithfully executed must be construed to
authorize the President to order an
investigation of the act or conduct of local
officials when in his opinion the good of the
public service so requires."
As in MC No. 2010-138, the Court finds
nothing in two other questioned issuances of
the respondent, i.e., MC Nos. 2010-83 and
2011-08, that can be construed as infringing
onthe fiscal autonomy of LGUs. The
petitioners claim that the requirement to post
other documents in the mentioned issuances
went beyond the letter and spirit of Section
352 of the LGC and R.A. No. 9184, otherwise
known as the Government Procurement
Reform Act, by requiring that budgets,
expenditures, contracts and loans, and
procurement plans of LGUs be publicly posted
as well.
Pertinently, Section 352 of the LGC reads:
Section 352. Posting of the Summary of
Income and Expenditures. Local treasurers,
accountants, budget officers, and other
accountable officers shall, within thirty (30)
days from the end of the fiscal year, post in at
least three (3) publicly accessible and
conspicuous places in the local government
unit a summary of all revenues collected and
funds received including the appropriations
and disbursements of such funds during the
preceding fiscal year.
R.A. No. 9184, on the other hand, requires the
posting of the invitation to bid, notice of
award, notice to proceed, and approved
contract in the procuring entitys premises, in
newspapers of general circulation, and the
website of the procuring entity.
It is well to remember that fiscal autonomy
does not leave LGUs with unbridled discretion
in the disbursement of public funds. They
remain accountable to their constituency. For,
public office was created for the benefit of the
people and not the person who holds office.
The assailed issuances of the respondent, MC
Nos. 2010-83 and 2011-08, are but
implementation of this avowed policy of the
State to make public officials accountable to
the people. They are amalgamations of
existing laws, rules and regulation designed to
give teeth to the constitutional mandate of
transparency and accountability.
A scrutiny of the contents of the mentioned
issuances shows that they do not, in any
manner, violate the fiscal autonomy of LGUs.
To be clear, "[f]iscal autonomy means that
local governments have the power to create
their own sources of revenue in addition to
their equitable share in the national taxes
released by the national government, as well
as the power to allocate their resources in
accordance withtheir own priorities.It extends
to the preparation of their budgets, and local
officials in turn have to work within the
constraints thereof."
It is inconceivable, however, how the
publication of budgets, expenditures, contracts
and loans and procurement plans of LGUs
required in the assailed issuances could have
infringed on the local fiscal autonomy of
LGUs. Firstly, the issuances do not interfere
with the discretion of the LGUs in the
specification of their priority projects and the
allocation of their budgets. The posting
requirements are mere transparency measures
which do not at all hurt the manner by which
LGUs decide the utilization and allocation of
their funds.
Secondly, it appears that even Section 352 of
the LGC that is being invoked by the
petitioners does not exclude the requirement
for the posting of the additional documents
stated in MC Nos. 2010-83 and 2011-08.
Apparently, the mentioned provision requires
the publication of "a summary of revenues
collected and funds received, including the
appropriations and disbursements of such
funds." The additional requirement for the
posting of budgets, expenditures, contracts
and loans, and procurement plans are well-
within the contemplation of Section 352 of the
LGC considering they are documents
necessary for an accurate presentation of a
summary of appropriations and
disbursements that an LGU is required to
publish.
Finally, the Court believes that the supervisory
powers of the President are broad enough to
embrace the power to require the publication
of certain documents as a mechanism of
transparency.
TWO FOLD CHARACTER OF A MUN. CORP
Veterans Federation of Ph vs. Reyes
FACTS: Petitioner in this case is the Veterans
Federation of the Philippines (VFP), a
corporate body organized under Republic Act
No. 2640, dated 18 June 1960, as amended, and
duly registered with the Securities and
Exchange Commission. Respondent Angelo T.
Reyes was the Secretary of National Defense
(DND Secretary) who issued the assailed
Department Circular No. 04, dated 10 June
2002. Respondent Edgardo E. Batenga was the
DND Undersecretary for Civil Relations and
Administration who was tasked by the
respondent DND Secretary to conduct an
extensive management audit of the records of
petitioner.
Petitioner received a letter demanding him to
explain the relation of the petitioner with
Philippine Veterans Bank
Thereafter DND issued DO no. 04
implementing sec. 1 and 2 of RA 2640
Thereafter, petitioners President received a
letter dated 23 August 2002 from respondent
Undersecretary, informing him that
Department Order No. 129 dated 23 August
2002 directed "the conduct of a Management
Audit of the Veterans Federation of the
Philippines."
Respondent Undersecretary also requested
both for a briefing and for documents on
personnel, ongoing projects and petitioners
financial condition. The letter ended by stating
that, after the briefing, the support staff of the
Audit Committee would begin their work to
meet the one-month target within which to
submit a report.
A letter dated 28 August 2003 informed
petitioners President that the Management
Audit Group headed by the Undersecretary
would be paying petitioner a visit on 30
August 2002 for an update on VFPs different
affiliates and the financial statement of the
Federation.
Subsequently, the Secretary General of the
VFP sent an undated letter to respondent
DND Secretary, with notice to respondent
Undersecretary for Civil Relations and
Administration, complaining about the alleged
broadness of the scope of the management
audit and requesting the suspension thereof
until such time that specific areas of the audit
shall have been agreed upon.
ISSUE: W/N VFP is a private corporation
RULING: NO, VFP is not a private
corporation but a public corporation
Petitioner claims that it is not a public nor a
governmental entity but a private
organization, and advances this claim to prove
that the issuance of DND Department Circular
No. 04 is an invalid exercise of respondent
Secretarys control and supervision.
Petitioners should be deemed to imply either
of the following: (1) that it is
unconstitutional/impermissible for the law
(Rep. Act No. 2640) to grant control and/or
supervision to the Secretary of National
Defense over a private organization, or (2) that
the control and/or supervision that can be
granted to the Secretary of National Defense
over a private organization is limited, and is
not as strong as they are defined above.
From the foregoing, it is crystal clear that our
constitutions explicitly prohibit the regulation
by special laws of private corporations, with
the exception of government-owned or
controlled corporations (GOCCs). Hence, it
would be impermissible for the law to grant
control of the VFP to a public official if it were
neither a public corporation, an
unincorporated governmental entity, nor a
GOCC.
Petitioner vigorously argues that the VFP is a
private non-government organization,
pressing on the following contentions:
1. The VFP does not possess the elements
which would qualify it as a public office,
particularly the possession/delegation of a
portion of sovereign power of government to
be exercised for the benefit of the public;
2. VFP funds are not public funds because
a) No budgetary appropriations or
government funds have been released to the
VFP directly or indirectly from the
Department of Budget and Management
(DBM);
b) VFP funds come from membership dues;
c) The lease rentals raised from the use of
government lands reserved for the VFP are
private in character and do not belong to the
government. Said rentals are fruits of VFPs
labor and efforts in managing and
administering the lands for VFP purposes and
objectives. A close analogy would be any
Filipino citizen settling on government land
and who tills the land for his livelihood and
sustenance. The fruits of his labor belong to
him and not to the owner of the land. Such
fruits are not public funds.
3. Although the juridical personality of the
VFP emanates from a statutory charter, the
VFP retains its essential character as a private,
civilian federation of veterans voluntarily
formed by the veterans themselves to attain a
unity of effort, purpose and objectives, e.g.
a. The members of the VFP are individual
members and retirees from the public and
military service;
b. Membership in the VFP is voluntary, not
compulsory;
c. The VFP is governed, not by the Civil
Service Law, the Articles of War nor the GSIS
Law, but by the Labor Code and the SSS Law;
d. The VFP has its own Constitution and By-
Laws and is governed by a Supreme Council
who are elected from and by the members
themselves;
4. The Administrative Code of 1987 does not
provide that the VFP is an attached agency,
nor does it provide that it is an entity under
the control and supervision of the DND in the
context of the provisions of said code.
5. The DBM declared that the VFP is a non-
government organization and issued a
certificate that the VFP has not been a direct
recipient of any funds released by the DBM.
In Laurel v. Desierto, we adopted the
definition of Mechem of a public office, that it
is "the right, authority and duty, created and
conferred by law, by which, for a given period,
either fixed by law or enduring at the pleasure
of the creating power, an individual is
invested with some portion of the sovereign
functions of the government, to be exercised
by him for the benefit of the public."
In the same case, we went on to adopt
Mechems view that the delegation to the
individual of some of the sovereign functions
of government is "[t]he most important
characteristic" in determining whether a
position is a public office or not. Such portion
of the sovereignty of the country, either
legislative, executive or judicial, must attach to
the office for the time being, to be exercised for
the public benefit. Unless the powers
conferred are of this nature, the individual is
not a public officer. The most important
characteristic which distinguishes an office
from an employment or contract is that the
creation and conferring of an office involves a
delegation to the individual of some of the
sovereign functions of government, to be
exercised by him for the benefit of the public;
that some portion of the sovereignty of the
country, either legislative, executive or
judicial, attaches, for the time being, to be
exercised for the public benefit.
In the case at bar, the functions of petitioner
corporation enshrined in Section 4 of Rep. Act
No. 2640 should most certainly fall within the
category of sovereign functions. The
protection of the interests of war veterans is
not only meant to promote social justice, but is
also intended to reward patriotism. All of the
functions in Section 4 concern the well-being
of war veterans, our countrymen who risked
their lives and lost their limbs in fighting for
and defending our nation. It would be
injustice of catastrophic proportions to say
that it is beyond sovereigntys power to
reward the people who defended her.
The fact that no budgetary appropriations
have been released to the VFP does not prove
that it is a private corporation. The DBM
indeed did not see it fit to propose budgetary
appropriations to the VFP, having itself
believed that the VFP is a private corporation.
If the DBM, however, is mistaken as to its
conclusion regarding the nature of VFPs
incorporation, its previous assertions will not
prevent future budgetary appropriations to
the VFP. The erroneous application of the law
by public officers does not bar a subsequent
correct application of the law.
Nevertheless, funds in the hands of the VFP
from whatever source are public funds, and
can be used only for public purposes. This is
mandated by the following provisions of Rep.
Act No. 2640
In Republic v. COCOFED, we held that the
Coconut Levy Funds are public funds because,
inter alia, (1) they were meant to be for the
benefit of the coconut industry, one of the
major industries supporting the national
economy, and its farmers; and (2) the very
laws governing coconut levies recognize their
public character. The same is true with regard
to the VFP funds. No less public is the use for
the VFP funds, as such use is limited to the
purposes of the VFP which we have ruled to
be sovereign functions. Likewise, the law
governing VFP funds (Rep. Act No. 2640)
recognizes the public character of the funds as
shown in the enumerated provisions above.
We also observed in the same COCOFED case
that "(e)ven if the money is allocated for a
special purpose and raised by special means, it
is still public in character." In the case at bar,
some of the funds were raised by even more
special means, as the contributions from
affiliate organizations of the VFP can hardly
be regarded as enforced contributions as to be
considered taxes. They are more in the nature
of donations which have always been
recognized as a source of public funding.
Affiliate organizations of the VFP cannot
complain of their contributions becoming
public funds upon the receipt by the VFP,
since they are presumed aware of the
provisions of Rep. Act No. 2640 which not
only specifies the exclusive purposes for
which VFP funds can be used, but also
provides for the regulation of such funds by
the national government through the Secretary
of National Defense.
Neither is the civilian nature of VFP relevant
in this case. The Constitution does not contain
any prohibition, express or implied, against
the grant of control and/or supervision to the
Secretary of National Defense over a civilian
organization. The Office of the Secretary of
National Defense is itself a civilian office, its
occupant being an alter ego of the civilian
Commander-in-Chief. This set-up is the
manifestation of the constitutional principle
that civilian authority is, at all times, supreme
over the military. There being no such
constitutional prohibition, the creation of a
civilian public organization by Rep. Act No.
2640 is not rendered invalid by its being
placed under the control and supervision of
the Secretary of National Defense.
The Administrative Code, by giving
definitions of the various entities covered by
it, acknowledges that its enumeration is not
exclusive. The Administrative Code could not
be said to have repealed nor enormously
modified Rep. Act No. 2640 by implication, as
such repeal or enormous modification by
implication is not favored in statutory
construction.
Respondents claim that the supposed
declaration of the DBM that petitioner is a
non-government organization is not
persuasive, since DBM is not a quasi-judicial
agency. They aver that what we have said of
the Bureau of Local Government Finance
(BLGF) in Philippine Long Distance Telephone
Company (PLDT) v. City of Davao can be
applied to DBM
On this score, though, we disagree with
respondents and hold that the DBMs
appraisal is considered persuasive.
Respondents misread the PLDT case in
asserting that only quasi-judicial agencies
determination can be considered persuasive.
What the PLDT case points out is that, for an
administrative agencys opinion to be
persuasive, the administrative agency
involved (whether it has quasi-judicial powers
or not) must be an expert in the field they are
giving their opinion on.
The persuasiveness of the DBM opinion has,
however, been overcome by all the previous
explanations we have laid so far. It has also
been eclipsed by another similarly persuasive
opinion, that of the Department of National
Defense embodied in Department Circular No.
04. The DND is clearly more of an expert with
respect to the determination of the entities
under it, and its Administrative Rules and
Regulations are entitled to great respect and
have in their favor the presumption of legality.
The DBM opinion furthermore suffers from its
lack of explanation and justification in the
"certification of non-receipt" where said
opinion was given. The DBM has not
furnished, in said certification or elsewhere, an
explanation for its opinion that VFP is a non-
government organization.
The definition of the power of control and
supervision under Section 2 of the assailed
Department Circular are synonymous with the
foregoing definitions. Consequently, and
considering that petitioner is a public
corporation, the provisions of the assailed
Department Circular No. 04 did not supplant
nor modify the provisions of Republic Act No.
2640, thus not violating the settled rule that
"all such (administrative) issuances must not
override, but must remain consistent and in
harmony with the law they seek to apply or
implement. Administrative rules and
regulations are intended to carry out, neither
to supplant nor to modify, the law."
Department Circular No. 04 is an internal
regulation. As we have ruled, they are meant
to regulate a public corporation under the
control of DND, and not the public in general.
As likewise discussed above, what has been
created as a body corporate by Rep. Act No.
2640 is not the individual membership of the
affiliate organizations of the VFP, but merely
the aggregation of the heads of the affiliate
organizations. Consequently, the individual
members of the affiliate organizations, who
are not public officers, are beyond the
regulation of the circular.
Sections 2, 3 and 6 of the assailed circular are
additionally merely interpretative in nature.
They add nothing to the law. They do not
affect the substantial rights of any person,
whether party to the case at bar or not. In
Sections 2 and 3, control and supervision are
defined, mentioning actions that can be
performed as consequences of such control
and supervision, but without specifying the
particular actions that shall be rendered to
control and supervise the VFP. Section 6, in
the same vein, merely state what the drafters
of the circular perceived to be consequences of
being an attached agency to a regular
department of the government, enumerating
sanctions and remedies provided by law that
may be availed of whenever desired.
Fontanilla vs. Maliaman
FACTS: It appears that on August 21, 1976 at
about 6:30 P.M., a pickup owned and operated
by respondent National Irrigation
Administration, a government agency bearing
Plate No. IN-651, then driven officially by
Hugo Garcia, an employee of said agency as
its regular driver, bumped a bicycle ridden by
Francisco Fontanilla, son of herein petitioners,
and Restituto Deligo, at Maasin, San Jose City
along the Maharlika Highway. As a result of
the impact, Francisco Fontanilla and Restituto
Deligo were injured and brought to the San
Jose City Emergency Hospital for treatment.
Fontanilla was later transferred to the
Cabanatuan Provincial Hospital where he
died.
Garcia was then a regular driver of respondent
National Irrigation Administration who, at the
time of the accident, was a licensed
professional driver and who qualified for
employment as such regular driver of
respondent after having passed the written
and oral examinations on traffic rules and
maintenance of vehicles given by National
Irrigation Administration authorities.
After trial, the trial court rendered judgment
on March 20, 1980 which directed respondent
National Irrigation Administration to pay
damages (death benefits) and actual expenses
to petitioners.
ISSUE: W/N National Irrigation
Administration is liable for damages
RULING: YES, they are liable to pay for the
damages
The liability of the State has two aspects.
namely:
1. Its public or governmental aspects
where it is liable for the tortious acts of special
agents only.
2. Its private or business aspects (as
when it engages in private enterprises) where
it becomes liable as an ordinary employer.
In this jurisdiction, the State assumes a limited
liability for the damage caused by the tortious
acts or conduct of its special agent.
Under the aforequoted paragrah 6 of Art. 2180,
the State has voluntarily assumed liability for
acts done through special agents. The State's
agent, if a public official, must not only be
specially commissioned to do a particular task
but that such task must be foreign to said
official's usual governmental functions. If the
State's agent is not a public official, and is
commissioned to perform non-governmental
functions, then the State assumes the role of an
ordinary employer and will be held liable as
such for its agent's tort. Where the government
commissions a private individual for a special
governmental task, it is acting through a
special agent within the meaning of the
provision.
Certain functions and activities, which can be
performed only by the government, are more
or less generally agreed to be "governmental"
in character, and so the State is immune from
tort liability. On the other hand, a service
which might as well be provided by a private
corporation, and particularly when it collects
revenues from it, the function is considered a
"proprietary" one, as to which there may be
liability for the torts of agents within the scope
of their employment.
Indubitably, the NIA is a government
corporation with juridical personality and not
a mere agency of the government. Since it is a
corporate body performing non-governmental
functions, it now becomes liable for the
damage caused by the accident resulting from
the tortious act of its driver-employee. In this
particular case, the NIA assumes the
responsibility of an ordinary employer and as
such, it becomes answerable for damages.
At this juncture, the matter of due diligence on
the part of respondent NIA becomes a crucial
issue in determining its liability since it has
been established that respondent is a
government agency performing proprietary
functions and as such, it assumes the posture
of an ordinary employer which, under Par. 5
of Art. 2180, is responsible for the damages
caused by its employees provided that it has
failed to observe or exercise due diligence in
the selection and supervision of the driver.
Evidently, there was negligence in the
supervision of the driver for the reason that
they were travelling at a high speed within the
city limits and yet the supervisor of the group,
Ely Salonga, failed to caution and make the
driver observe the proper and allowed speed
limit within the city. Under the situation, such
negligence is further aggravated by their
desire to reach their destination without even
checking whether or not the vehicle suffered
damage from the object it bumped, thus
showing imprudence and reckelessness on the
part of both the driver and the supervisor in
the group.
Boy Scout a Public Corporation?
BSP vs. COA
FACTS: This case arose when the COA issued
Resolution No. 99-011[5] on August 19, 1999
(the COA Resolution), with the subject
Defining the Commissions policy with respect
to the audit of the Boy Scouts of the
Philippines. In its whereas clauses, the COA
Resolution stated that the BSP was created as a
public corporation under Commonwealth Act
No. 111, as amended by Presidential Decree
No. 460 and Republic Act No. 7278; that in Boy
Scouts of the Philippines v. National Labor
Relations Commission, the Supreme Court
ruled that the BSP, as constituted under its
charter, was a government-controlled
corporation within the meaning of Article
IX(B)(2)(1) of the Constitution; and that the
BSP is appropriately regarded as a
government instrumentality under the 1987
Administrative Code
BSP sought reconsideration through a letter
but COA General Counsel opined that
Republic Act No. 7278 did not supersede the
Courts ruling in Boy Scouts of the Philippines
v. National Labor Relations Commission, even
though said law eliminated the substantial
government participation in the selection of
members of the National Executive Board of
the BSP.
Upon the BSPs request, the audit was deferred
for thirty (30) days. The BSP then filed a
Petition for Review with Prayer for
Preliminary Injunction and/or Temporary
Restraining Order before the COA. This was
denied by the COA in its questioned Decision,
which held that the BSP is under its audit
jurisdiction. The BSP moved for
reconsideration but this was likewise denied
under its questioned Resolution.
ISSUE: W/N BSP falls under the jurisdiction
of COA
RULING: YES, it is a public corporation
hence under the jurisdiction of COA
The BSP Charter (Commonwealth Act No. 111,
approved on October 31, 1936), entitled An
Act to Create a Public Corporation to be
Known as the Boy Scouts of the Philippines,
and to Define its Powers and Purposes created
the BSP as a public corporation to serve the
following public interest or purpose:
Sec. 3. The purpose of this corporation shall be
to promote through organization and
cooperation with other agencies, the ability of
boys to do useful things for themselves and
others, to train them in scoutcraft, and to
inculcate in them patriotism, civic
consciousness and responsibility, courage,
self-reliance, discipline and kindred virtues,
and moral values, using the method which are
in common use by boy scouts.
Subsequently, on March 24, 1992, Republic Act
No. 7278 further amended Commonwealth
Act No. 111 by strengthening the volunteer
and democratic character of the BSP and
reducing government representation in its
governing body, as follows:
"Sec. 3. The purpose of this corporation shall
be to promote through organization and
cooperation with other agencies, the ability of
boys to do useful things for themselves and
others, to train them in scoutcraft, and to
inculcate in them patriotism, civic
consciousness and responsibility, courage,
self-reliance, discipline and kindred virtues,
and moral values, using the method which are
in common use by boy scouts."
"Sec. 4. The President of the Philippines shall
be the Chief Scout of the Boy Scouts of the
Philippines."
"Sec. 5. The governing body of the said
corporation shall consist of a National
Executive Board, the members of which shall
be Filipino citizens of good moral character.
The Board shall be composed of the following:
"(c) The Secretary of Education, Culture and
Sports;
There are three classes of juridical persons
under Article 44 of the Civil Code and the BSP,
as presently constituted under Republic Act
No. 7278, falls under the second classification.
Article 44 reads:
Art. 44. The following are juridical persons:
(2) Other corporations, institutions and entities
for public interest or purpose created by law;
their personality begins as soon as they have
been constituted according to law;
The public, rather than private, character of
the BSP is recognized by the fact that, along
with the Girl Scouts of the Philippines, it is
classified as an attached agency of the DECS
under Executive Order No. 292, or the
Administrative Code of 1987
As an attached agency, the BSP enjoys
operational autonomy, as long as policy and
program coordination is achieved by having at
least one representative of government in its
governing board, which in the case of the BSP
is the DECS Secretary. In this sense, the BSP is
not under government control or supervision
and control. Still this characteristic does not
make the attached chartered agency a private
corporation covered by the constitutional
proscription in question.
It may be gleaned from the above discussion
that Article XII, Section 16 bans the creation of
private corporations by special law. The said
constitutional provision should not be
construed so as to prohibit the creation of
public corporations or a corporate agency or
instrumentality of the government intended to
serve a public interest or purpose, which
should not be measured on the basis of
economic viability, but according to the public
interest or purpose it serves as envisioned by
paragraph (2), of Article 44 of the Civil Code
and the pertinent provisions of the
Administrative Code of 1987.
The BSP is a public corporation or a
government agency or instrumentality with
juridical personality, which does not fall
within the constitutional prohibition in Article
XII, Section 16, notwithstanding the
amendments to its charter. Not all
corporations, which are not government
owned or controlled, are ipso facto to be
considered private corporations as there exists
another distinct class of corporations or
chartered institutions which are otherwise
known as public corporations. These
corporations are treated by law as agencies or
instrumentalities of the government which are
not subject to the tests of ownership or control
and economic viability but to different criteria
relating to their public purposes/interests or
constitutional policies and objectives and their
administrative relationship to the government
or any of its Departments or Offices.
Note that in Boy Scouts of the Philippines v.
National Labor Relations Commission, the
BSP, under its former charter, was regarded as
both a government owned or controlled
corporation with original charter and a public
corporation. The said case pertinently stated:
While the BSP may be seen to be a mixed type
of entity, combining aspects of both public and
private entities, we believe that considering
the character of its purposes and its functions,
the statutory designation of the BSP as "a
public corporation" and the substantial
participation of the Government in the
selection of members of the National
Executive Board of the BSP, the BSP, as
presently constituted under its charter, is a
government-controlled corporation within the
meaning of Article IX (B) (2) (1) of the
Constitution.
It thus appears that the BSP may be regarded
as both a "government controlled corporation
with an original charter" and as an
"instrumentality" of the Government within
the meaning of Article IX (B) (2) (1) of the
Constitution.
The existence of public or government
corporate or juridical entities or chartered
institutions by legislative fiat distinct from
private corporations and government owned
or controlled corporation is best exemplified
by the 1987 Administrative Code cited above,
which we quote in part:
Sec. 2. General Terms Defined. Unless the
specific words of the text, or the context as a
whole, or a particular statute, shall require a
different meaning:
(10) "Instrumentality" refers to any agency of
the National Government, not integrated
within the department framework, vested
with special functions or jurisdiction by law,
endowed with some if not all corporate
powers, administering special funds, and
enjoying operational autonomy, usually
through a charter. This term includes
regulatory agencies, chartered institutions and
government-owned or controlled
corporations.
(12) "Chartered institution" refers to any
agency organized or operating under a special
charter, and vested by law with functions
relating to specific constitutional policies or
objectives. This term includes the state
universities and colleges and the monetary
authority of the State.
(13) "Government-owned or controlled
corporation" refers to any agency organized as
a stock or non-stock corporation, vested with
functions relating to public needs whether
governmental or proprietary in nature, and
owned by the Government directly or through
its instrumentalities either wholly, or, where
applicable as in the case of stock corporations,
to the extent of at least fifty-one (51) per cent
of its capital stock: Provided, That
government-owned or controlled corporations
may be further categorized by the Department
of the Budget, the Civil Service Commission,
and the Commission on Audit for purposes of
the exercise and discharge of their respective
powers, functions and responsibilities with
respect to such corporations.
It is undisputed that the BSP performs
functions that are impressed with public
interest.
Furthermore, this Court cannot agree with the
dissenting opinion which equates the changes
introduced by Republic Act No. 7278 to the
BSP Charter as clear manifestation of the
intent of Congress to return the BSP to the
private sector. It was not the intent of
Congress in enacting Republic Act No. 7278 to
give up all interests in this basic youth
organization, which has been its partner in
forming responsible citizens for decades.
In fact, as may be seen in the deliberation of
the House Bills that eventually resulted to
Republic Act No. 7278, Congress worked
closely with the BSP to rejuvenate the
organization, to bring it back to its former
glory reached under its original charter,
Commonwealth Act No. 111, and to correct
the perceived ills introduced by the
amendments to its Charter under Presidential
Decree No. 460.
Therefore, even though the amended BSP
charter did away with most of the
governmental presence in the BSP Board, this
was done to more strongly promote the BSPs
objectives, which were not supported under
Presidential Decree No. 460. The BSP
objectives, as pointed out earlier, are
consistent with the public purpose of the
promotion of the well-being of the youth, the
future leaders of the country. The
amendments were not done with the view of
changing the character of the BSP into a
privatized corporation. The BSP remains an
agency attached to a department of the
government, the DECS, and it was not at all
stripped of its public character.
The ownership and control test is likewise
irrelevant for a public corporation like the
BSP. To reiterate, the relationship of the BSP,
an attached agency, to the government,
through the DECS, is defined in the Revised
Administrative Code of 1987. The BSP meets
the minimum statutory requirement of an
attached government agency as the DECS
Secretary sits at the BSP Board ex officio, thus
facilitating the policy and program
coordination between the BSP and the DECS.
QUASI PUBLIC CORP
Philippine Society vs. COA
FACTS: The petitioner was incorporated as a
juridical entity over one hundred years ago by
virtue of Act No. 1285, enacted on January 19,
1905, by the Philippine Commission. The
petitioner, at the time it was created, was
composed of animal aficionados and animal
propagandists. The objects of the petitioner, as
stated in Section 2 of its charter, shall be to
enforce laws relating to cruelty inflicted upon
animals or the protection of animals in the
Philippine Islands, and generally, to do and
perform all things which may tend in any way
to alleviate the suffering of animals and
promote their welfare.
At the time of the enactment of Act No. 1285,
the original Corporation Law, Act No. 1459,
was not yet in existence. Act No. 1285
antedated both the Corporation Law and the
constitution of the Securities and Exchange
Commission. Important to note is that the
nature of the petitioner as a corporate entity is
distinguished from the sociedad anonimas
under the Spanish Code of Commerce.
For the purpose of enhancing its powers in
promoting animal welfare and enforcing laws
for the protection of animals, the petitioner
was initially imbued under its charter with the
power to apprehend violators of animal
welfare laws. In addition, the petitioner was to
share one-half (1/2) of the fines imposed and
collected through its efforts for violations of
the laws related thereto.
Subsequently, however, the power to make
arrests as well as the privilege to retain a
portion of the fines collected for violation of
animal-related laws were recalled by virtue of
Commonwealth Act (C.A.) No. 148
On December 1, 2003, an audit team from
respondent Commission on Audit (COA)
visited the office of the petitioner to conduct
an audit survey pursuant to COA Office Order
No. 2003-051 dated November 18, 2003
addressed to the petitioner. The petitioner
demurred on the ground that it was a private
entity not under the jurisdiction of COA
That Executive Order No. 63, issued during
the Commonwealth period, effectively
deprived the petitioner of its power to make
arrests, and that the petitioner lost its
operational funding, underscore the fact that it
exercises no governmental function. In fine,
the government itself, by its overt acts,
confirmed petitioners status as a private
juridical entity.
Acting on the said request, the General
Counsel of respondent COA, in a
Memorandum dated July 13, 2004, affirmed
her earlier opinion that the petitioner was a
government entity that was subject to the
audit jurisdiction of respondent COA.
ISSUE: W/N COA has jurisdiction over the
petitioner
RULING: NO, it is a private corporation
Essentially, the charter test as it stands today
provides:
[T]he test to determine whether a corporation
is government owned or controlled, or private
in nature is simple. Is it created by its own
charter for the exercise of a public function, or
by incorporation under the general
corporation law? Those with special charters
are government corporations subject to its
provisions, and its employees are under the
jurisdiction of the Civil Service Commission,
and are compulsory members of the
Government Service Insurance System.
During the formulation of the 1935
Constitution, the Committee on Franchises
recommended the foregoing proscription to
prevent the pressure of special interests upon
the lawmaking body in the creation of
corporations or in the regulation of the same.
To permit the lawmaking body by special law
to provide for the organization, formation, or
regulation of private corporations would be in
effect to offer to it the temptation in many
cases to favor certain groups, to the prejudice
of others or to the prejudice of the interests of
the country.
And since the underpinnings of the charter
test had been introduced by the 1935
Constitution and not earlier, it follows that the
test cannot apply to the petitioner, which was
incorporated by virtue of Act No. 1285,
enacted on January 19, 1905. Settled is the rule
that laws in general have no retroactive effect,
unless the contrary is provided. All statutes
are to be construed as having only a
prospective operation, unless the purpose and
intention of the legislature to give them a
retrospective effect is expressly declared or is
necessarily implied from the language used. In
case of doubt, the doubt must be resolved
against the retrospective effect.
The general principle of prospectivity of the
law likewise applies to Act No. 1459,
otherwise known as the Corporation Law,
which had been enacted by virtue of the
plenary powers of the Philippine Commission
on March 1, 1906, a little over a year after
January 19, 1905, the time the petitioner
emerged as a juridical entity. Even the
Corporation Law respects the rights and
powers of juridical entities organized
beforehand, viz:
SEC. 75. Any corporation or sociedad anonima
formed, organized, and existing under the
laws of the Philippine Islands and lawfully
transacting business in the Philippine Islands
on the date of the passage of this Act, shall be
subject to the provisions hereof so far as such
provisions may be applicable and shall be
entitled at its option either to continue
business as such corporation or to reform and
organize under and by virtue of the provisions
of this Act, transferring all corporate interests
to the new corporation which, if a stock
corporation, is authorized to issue its shares of
stock at par to the stockholders or members of
the old corporation according to their
interests.
The textual foundation of the charter test,
which placed a limitation on the power of the
legislature, first appeared in the 1935
Constitution. However, the petitioner was
incorporated in 1905 by virtue of Act No. 1258,
a law antedating the Corporation Law (Act
No. 1459) by a year, and the 1935 Constitution,
by thirty years. There being neither a general
law on the formation and organization of
private corporations nor a restriction on the
legislature to create private corporations by
direct legislation, the Philippine Commission
at that moment in history was well within its
powers in 1905 to constitute the petitioner as a
private juridical entity.
The amendments introduced by C.A. No. 148
made it clear that the petitioner was a private
corporation and not an agency of the
government. This was evident in Executive
Order No. 63, issued by then President of the
Philippines Manuel L. Quezon, declaring that
the revocation of the powers of the petitioner
to appoint agents with powers of arrest
corrected a serious defect in one of the laws
existing in the statute books.
As a curative statute, and based on the
doctrines so far discussed, C.A. No. 148 has to
be given retroactive effect, thereby freeing all
doubt as to which class of corporations the
petitioner belongs, that is, it is a quasi-public
corporation, a kind of private domestic
corporation, which the Court will further
elaborate on under the fourth point.
Second, a reading of petitioners charter shows
that it is not subject to control or supervision
by any agency of the State, unlike
government-owned and -controlled
corporations. No government representative
sits on the board of trustees of the petitioner.
Like all private corporations, the successors of
its members are determined voluntarily and
solely by the petitioner in accordance with its
by-laws, and may exercise those powers
generally accorded to private corporations,
such as the powers to hold property, to sue
and be sued, to use a common seal, and so
forth. It may adopt by-laws for its internal
operations: the petitioner shall be managed or
operated by its officers in accordance with its
by-laws in force.
Third. The employees of the petitioner are
registered and covered by the Social Security
System at the latters initiative, and not
through the Government Service Insurance
System, which should be the case if the
employees are considered government
employees. This is another indication of
petitioners nature as a private entity. Section 1
of Republic Act No. 1161, as amended by
Republic Act No. 8282, otherwise known as
the Social Security Act of 1997.
Fourth. The respondents contend that the
petitioner is a body politic because its primary
purpose is to secure the protection and welfare
of animals which, in turn, redounds to the
public good.
This argument, is, at best, specious. The fact
that a certain juridical entity is impressed with
public interest does not, by that circumstance
alone, make the entity a public corporation,
inasmuch as a corporation may be private
although its charter contains provisions of a
public character, incorporated solely for the
public good
This class of corporations may be considered
quasi-public corporations, which are private
corporations that render public service, supply
public wants, or pursue other eleemosynary
objectives. While purposely organized for the
gain or benefit of its members, they are
required by law to discharge functions for the
public benefit. Examples of these corporations
are utility, railroad, warehouse, telegraph,
telephone, water supply corporations and
transportation companies. It must be stressed
that a quasi-public corporation is a species of
private corporations, but the qualifying factor
is the type of service the former renders to the
public: if it performs a public service, then it
becomes a quasi-public corporation.
The true criterion, therefore, to determine
whether a corporation is public or private is
found in the totality of the relation of the
corporation to the State. If the corporation is
created by the State as the latters own agency
or instrumentality to help it in carrying out its
governmental functions, then that corporation
is considered public; otherwise, it is private.
Applying the above test, provinces, chartered
cities, and barangays can best exemplify
public corporations. They are created by the
State as its own device and agency for the
accomplishment of parts of its own public
works.
Fifth. The respondents argue that since the
charter of the petitioner requires the latter to
render periodic reports to the Civil Governor,
whose functions have been inherited by the
President, the petitioner is, therefore, a
government instrumentality.
This contention is inconclusive. By virtue of
the fiction that all corporations owe their very
existence and powers to the State, the
reportorial requirement is applicable to all
corporations of whatever nature, whether they
are public, quasi-public, or private
corporationsas creatures of the State, there is a
reserved right in the legislature to investigate
the activities of a corporation to determine
whether it acted within its powers. In other
words, the reportorial requirement is the
principal means by which the State may see to
it that its creature acted according to the
powers and functions conferred upon it. These
principles were extensively discussed in
Bataan Shipyard & Engineering Co., Inc. v.
Presidential Commission on Good
Government
Marilao Water Assoc Inc. vs. IAC
FACTS: Involved in this appeal is the
determination of which triburial has
jurisdiction over the dissolution of a water
district organized and operating as a quasi-
public corporation under the provisions of
Presidential Decree No. 198, as amended.
PD 198 authorizes the formation, lays down
the powers and functions, and governs the
operation of water districts throughout the
country; it is "the source of authorization and
power to form and maintain a (water) district."
Once formed, it says, a district is subject to its
provisions and is not under the jurisdiction of
any political subdivision.
Under PD 198, water districts may be created
by the different local legislative bodies by the
passage of a resolution to this effect, subject to
the terms of the decree. The primary function
of these water districts is to sell water to
residents within their territory, under such
schedules of rates and charges as may be
determined by their boards. They shall
manage, administer, operate and maintain all
watersheds within their territorial boundaries,
safeguard and protect the use of the waters
therein, supervise and control structures
within their service areas, and prohibit any
person from selling or otherwise disposing of
water for public purposes within their service
areas where district facilities are available to
provide such service.
The juridical entities thus created and
organized under PD 198 are considered quasi-
public corporations, performing public
services and supplying public wants. They are
authorized not only to "exercise all the powers
which are expressly granted" by said decree,
and those "which are necessarily implied from
or incidental to" said powers, but also "the
power of eminent domain, the exercise .. (of
which) shall however be subject to review by
the Administration" (LWUA). In addition to
the powers granted in, and subject to such
restrictions imposed under, the Act, they may
also exercise the powers, rights and privileges
given to private corporations under existing
laws.
It was pursuant to the foregoing rules and
norms that the Marilao Water District was
formed by Resolution of the Sangguniang
Bayan of the Municipality of Marilao dated
September 18, 1982, which resolution was
thereafter forwarded to the LWUA and "duly
filed" by it on October 4, 1982 after
ascertaining that it conformed to the
requirements of the law.
The claim was thereafter made that the
creation of the Marilao Water District in the
manner aforestated was defective and illegal.
The claim was made by a non-stock, non-
profit corporation known as the Marilao Water
Consumers Association, Inc., in a petition
dated December 12, 1983 filed with the
Regional Trial Court at Malolos, Bulacan.
Impleaded as respondents were the Marilao
Water District, as well as the Municipality of
Marilao, Bulacan; its Sangguniang Bayan; and
Mayor Nicanor V. GUILLERMO. The petition
prayed for the dissolution of the water district
on the basis chiefly of the following allegations
ISSUE: W/N SEC has jurisdiction over
petitioner
RULING: NO, it does not fall within the
limited jurisdiction of the SEC, but within
the general jurisdiction of RTCs.
PD 198 authorizes the formation, lays down
the powers and functions, and governs the
operation of water districts throughout the
country; it is "the source of authorization and
power to form and maintain a (water) district."
Once formed, it says, a district is subject to its
provisions and is not under the jurisdiction of
any political subdivision.
The juridical entities thus created and
organized under PD 198 are considered quasi-
public corporations, performing public
services and supplying public wants.
The juridical entities known as water districts
created by PD 198, although considered as
quasi-public corporations and authorized to
exercise the powers, rights and privileges
given to private corporations under existing
laws are entirely distinct from corporations
organized under the Corporation Code, PD
902-A, as amended.
The Corporation Code has nothing whatever
to do with their formation and organization,
all the terms and conditions for their
organization and operation being particularly
spelled out in PD 198.
The resolutions creating them, their charters,
in other words, are filed not with the
Securities and Exchange Commission but with
the LWUA. It is these resolutions qua charters,
and not articles of incorporation drawn up
under the Corporation Code, which set forth
the name of the water districts, the number of
their directors, the manner of their selection
and replacement, their powers, etc.
The SEC which is charged with enforcement of
the Corporation Code as regards corporations,
partnerships and associations formed or
operating under its provisions, has no power
of supervision or control over the activities of
water districts.
The "Provincial Water Utilities Act of 1973"
has a specific provision governing dissolution
of water districts created thereunder This is
Section 45 of PD 198. Under this provision, it is
the LWUA which is the administrative body
involved in the voluntary dissolution of a
water district; it is with it that the resolution of
dissolution is filed, not the Securities and
Exchange Commission. And this provision is
evidently quite distinct and different from
those on dissolution of corporations "formed
or organized under the provisions of the
Corporation Code under which dissolution
may be voluntary (by vote of the stockholders
or members), generally effected by the filing of
the corresponding resolution with the
Securities and Exchange Commission, or
involuntary, commenced by the filing of a
verified complaint also with the SEC.
Although described as quasi-public
corporations, and granted the same powers as
private corporations, water districts are not
really corporations. They have no
incorporators, stockholders or members, who
have the right to vote for directors, or amend
the articles of incorporation or by-laws, or
pass resolutions, or otherwise perform such
other acts as are authorized to stockholders or
members of corporations by the Corporation
Code. In a word, there can be no such thing as
a relation of corporation and stockholders or
members in a water district for the simple
reason that in the latter there are no
stockholders or members. Between the water
district and those who are recipients of its
water services there exists not the relationship
of corporation-and-stockholder, but that of a
service agency and users or customers.
There can therefore be no such thing in a
water district as "intra-corporate or
partnership relations, between and among
stockholders, members or associates (or)
between any or all of them and the
corporation, partnership or association of
which they are stockholders, members or
associates, respectively," within the
contemplation of Section 5 of the Corporation
Code so as to bring controversies involving
them within the competence and cognizance
of the SEC.