HERNANDEZ, LICSI, MARQUEDA, UY
ADMIN LAW UNDER ATTY. GALLANT SORIANO
G.R. No. 120319 October 6, 1995
LUZON DEVELOPMENT BANK, petitioner, vs. ASSOCIATION OF
LUZON DEVELOPMENT BANK EMPLOYEES and ATTY. ESTER S.
GARCIA in her capacity as VOLUNTARY ARBITRATOR, respondents
DOCTRINE: The voluntary arbitrator, whether acting solely or in a panel,
enjoys in law the status of a quasi-judicial agency but independent of, and
apart from, the NLRC since his decisions are not appealable to the latter.
The voluntary arbitrator no less performs a state function pursuant to a
governmental power delegated to him under the provisions therefor in the
Labor Code and he falls, therefore, within the contemplation of the term
"instrumentality" in Sec. 9 of B.P. 129. The fact that his functions and powers
are provided for in the Labor Code does not place him within the exceptions
to said Sec. 9 since he is a quasi-judicial instrumentality as contemplated
therein.
The decision or award of the voluntary arbitrator or panel of arbitrators
should likewise be appealable to the Court of Appeals, in line with the
procedure outlined in Revised Administrative Circular No. 1-95, just like
those of the quasi-judicial agencies, boards and commissions enumerated
therein.
Facts:
From a submission agreement of petitioner and the respondent arose an
arbitration case to resolve the following issue: Whether or not the company
has violated the Collective Bargaining Agreement provision and the
Memorandum of Agreement on promotion.
At a conference, the parties agreed on the submission of their respective
Position Papers. Atty. Garcia, in her capacity as Voluntary Arbitrator,
received ALDBE's Position Paper. LDB, on the other hand, failed to submit
its Position Paper despite a letter from the Voluntary Arbitrator reminding
them to do so. No Position Paper had been filed by LDB. Without LDB's
Position Paper, the Voluntary Arbitrator rendered a decision finding the Bank
has not adhered to the Collective Bargaining Agreement provision nor the
Memorandum of Agreement on promotion.
Hence, this petition for certiorari and prohibition seeking to set aside the
decision of the Voluntary Arbitrator and to prohibit her from enforcing the
same.
Issue: WON the Court of Appeals have jurisdiction over the petition for
certiorari assailing the decision of the Voluntary Arbitrator
Held:
The state of our present law relating to voluntary arbitration provides that
"(t)he award or decision of the Voluntary Arbitrator . . . shall be final and
executory after ten (10) calendar days from receipt of the copy of the award
or decision by the parties," while the "decision, awards, or orders of the
Labor Arbiter are final and executory unless appealed to the Commission by
any or both parties within ten (10) calendar days from receipt of such
decisions, awards, or orders." Hence, while there is an express mode of
appeal from the decision of a labor arbiter, Republic Act No. 6715 is silent
with respect to an appeal from the decision of a voluntary arbitrator.
Yet, past practice shows that a decision or award of a voluntary arbitrator is,
more often than not, elevated to the Supreme Court itself on a petition for
certiorari, in effect equating the voluntary arbitrator with the NLRC or the
Court of Appeals. In the view of the Court, this is illogical and imposes an
unnecessary burden upon it.
In Volkschel Labor Union v. NLRC, on the settled premise that the judgments
of courts and awards of quasi-judicial agencies must become final at some
definite time, this Court ruled that the awards of voluntary arbitrators
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determine the rights of parties; hence, their decisions have the same legal
effect as judgments of a court. In Oceanic Bic Division v. Romero, this Court
ruled that "a voluntary arbitrator by the nature of her functions acts in a
quasi-judicial capacity." Under these rulings, it follows that the voluntary
arbitrator, whether acting solely or in a panel, enjoys in law the status of
a quasi-judicial agency but independent of, and apart from, the NLRC since
his decisions are not appealable to the latter.
Section 9 of B.P. Blg. 129, as amended by Republic Act No. 7902, provides
that the Court of Appeals shall exercise Exclusive appellate jurisdiction
over all final judgments, decisions, resolutions, orders or awards of
Regional Trial Courts and quasi-judicial agencies, instrumentalities,
boards or commissions, including the Securities and Exchange
Commission, the Employees Compensation Commission and the Civil
Service Commission, except those falling within the appellate jurisdiction of
the Supreme Court in accordance with the Constitution, the Labor Code of
the Philippines under Presidential Decree No. 442, as amended, the
provisions of this Act, and of subparagraph (1) of the third paragraph and
subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of
1948.
Assuming arguendo that the voluntary arbitrator or the panel of voluntary
arbitrators may not strictly be considered as a quasi-judicial agency, board or
commission, still both he and the panel are comprehended within the concept
of a "quasi-judicial instrumentality." It may even be stated that it was to meet
the very situation presented by the quasi-judicial functions of the voluntary
arbitrators here, as well as the subsequent arbitrator/arbitral tribunal
operating under the Construction Industry Arbitration Commission, that the
broader term "instrumentalities" was purposely included in the above-quoted
provision.
An "instrumentality" is anything used as a means or agency. Thus, the
terms governmental "agency" or "instrumentality" are synonymous in
the sense that either of them is a means by which a government acts, or
HERNANDEZ, LICSI, MARQUEDA, UY
by which a certain government act or function is performed. The word
"instrumentality," with respect to a state, contemplates an authority to
which the state delegates governmental power for the performance of a
state function. An individual person, like an administrator or executor, is a
judicial instrumentality in the settling of an estate, in the same manner that a
sub-agent appointed by a bankruptcy court is an instrumentality of the court,
and a trustee in bankruptcy of a defunct corporation is an instrumentality of
the state.
The voluntary arbitrator no less performs a state function pursuant to a
governmental power delegated to him under the provisions therefor in
the Labor Code and he falls, therefore, within the contemplation of the
term "instrumentality" in the aforequoted Sec. 9 of B.P. 129. The fact that
his functions and powers are provided for in the Labor Code does not place
him within the exceptions to said Sec. 9 since he is a quasi-judicial
instrumentality as contemplated therein. It will be noted that, although the
Employees Compensation Commission is also provided for in the Labor
Code, Circular No. 1-91, which is the forerunner of the present Revised
Administrative Circular No. 1-95, laid down the procedure for the
appealability of its decisions to the Court of Appeals under the foregoing
rationalization, and this was later adopted by Republic Act No. 7902 in
amending Sec. 9 of B.P. 129.
A fortiori, the decision or award of the voluntary arbitrator or panel of
arbitrators should likewise be appealable to the Court of Appeals, in line
with the procedure outlined in Revised Administrative Circular No. 1-95,
just like those of the quasi-judicial agencies, boards and commissions
enumerated therein.
This would be in furtherance of, and consistent with, the original purpose of
Circular No. 1-91 to provide a uniform procedure for the appellate review of
adjudications of all quasi-judicial entities not expressly excepted from the
coverage of Sec. 9 of B.P. 129 by either the Constitution or another statute.
Nor will it run counter to the legislative intendment that decisions of the
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ADMIN LAW UNDER ATTY. GALLANT SORIANO
NLRC be reviewable directly by the Supreme Court since, precisely, the
cases within the adjudicative competence of the voluntary arbitrator are
excluded from the jurisdiction of the NLRC or the labor arbiter.
In effect, this equates the award or decision of the voluntary arbitrator
with that of the regional trial court. Consequently, in a petition for
certiorari from that award or decision, the Court of Appeals must be
deemed to have concurrent jurisdiction with the Supreme Court. As a
matter of policy, this Court shall henceforth remand to the Court of
Appeals petitions of this nature for proper disposition.
IRON AND STEEL AUTHORITY vs. CA
G.R. No. 102976. October 25, 1995
FACTS:
P.D. No. 272 initially created petitioner ISA for a term of 5 years.
When ISA's original term expired, its term was extended for another 10 years
by EO No. 555. The National Steel Corporation (NSC) then a wholly owned
subsidiary of the National Development Corporation which is itself an entity
wholly owned by the National Government, entered into an expansion
program which included the construction of an integrated steel mill in Iligan
City.
Proclamation No. 2239 was issued by the President of the
Philippines withdrawing from sale or settlement a large tract of public land
(totalling about 30.25 hectares in area) located in Iligan City, and reserving
that land for the use and immediate occupancy of NSC. Since certain
portions of the public land were occupied by a non-operational chemical
fertilizer plant, owned by private respondent Maria Cristina Fertilizer
Corporation (MCFC), a letter of instruction was issued directing the NSC to
negotiate with the owners of MCFC for and on behalf of the Government and
that should NSC and MCFC fail to reach an agreement within a period of 60
days, ISA was to exercise its power of eminent domain under P.D. No. 272
and to initiate expropriation proceedings.
HERNANDEZ, LICSI, MARQUEDA, UY
When the negotiations failed, ISA commenced eminent domain
proceedings against MCFC in RTC praying that ISA be placed in possession
of the property involved. Thereafter, a writ of possession was issued by the
trial court in favor of ISA. ISA in turn placed NSC in possession and control
of the land occupied by MCFC's fertilizer plant installation. However, while
the case was on-going, the statutory existence of ISA expired. This prompted
MCFC to file a motion to dismiss contending that no valid judgment could be
rendered because ISA had ceased to be a juridical person.
The trial court granted MCFC's motion to dismiss and did dismiss
the case on the ground that under that Rules of Court, only natural or
juridical persons or entities authorized by law may be parties in a civil case.
ISA moved for reconsideration contending that despite the expiration of its
term, its juridical existence continued until the winding up of its affairs could
be completed. In the alternative, ISA urged that the Republic of the
Philippines, being the real party-in-interest, should be allowed to be
substituted for petitioner ISA. The MR was denied.
The CA affirmed the dismissal holding that ISA, did not have the
same rights as an ordinary corporation because unlike corporations organized
under the Corporation Code, ISA was not entitled to a period for winding up
its affairs after expiration of its legally mandated term. CA also ruled that the
action for expropriation could not prosper because the basis for the
proceedings, the ISA's exercise of its delegated authority to expropriate, had
become ineffective as a result of the delegate's dissolution, and could not be
continued in the name of Republic of the Philippines, represented by the
Solicitor General.
The Solicitor General argues that since ISA initiated and prosecuted
the action for expropriation in its capacity as agent of the Republic of the
Philippines, the Republic, as principal of ISA, is entitled to be substituted and
to be made a party-plaintiff after the agent ISA's term had expired.
On the other hand, MCFC argues that the failure of Congress to enact
a law further extending the term of ISA evinced a "clear legislative intent to
terminate the juridical existence of ISA," and that the authorization issued by
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the Office of the President to the Solicitor General for continued prosecution
of the expropriation suit could not prevail over such negative intent. It is also
contended that the exercise of the eminent domain by ISA or the Republic is
improper, since that power would be exercised "not on behalf of the National
Government but for the benefit of NSC."
ISSUE: Whether or not the Republic of the Philippines is entitled to be
substituted for ISA in view of the expiration of ISA's term
RULING:
YES. Parties to a civil action may be broadly categorized into 2
groups:
(a) those who are recognized as persons under the law whether
natural, i.e., biological persons, on the one hand, or juridical persons such as
corporations, on the other hand; and
(b) entities authorized by law to institute actions
Examination of the statute which created petitioner ISA shows that
ISA falls under category (b) above. P.D. No. 272 contains express
authorization to ISA to commence expropriation proceedings. It should also
be noted that the enabling statute of ISA expressly authorized it to enter into
certain kinds of contracts “for and in behalf of the Government.” Clearly,
ISA was vested with some of the powers or attributes normally associated
with juridical personality.
However, there is no provision in P.D. No. 272 recognizing ISA as
possessing general or comprehensive juridical personality separate and
distinct from that of the Government. In fact, ISA appears to be a non-
incorporated agency or instrumentality of the Government of the Republic of
the Philippines. It is common knowledge that other agencies or
instrumentalities of the Government of the Republic are cast in corporate
form, that is to say, are incorporated agencies o r instrumentalities,
sometimes with and at other times without capital stock, and accordingly
HERNANDEZ, LICSI, MARQUEDA, UY
vested with a juridical personality distinct from the personality of the
Republic.
ISA is properly regarded as an agent or delegate of the Republic of
the Philippines. The Republic itself is a body corporate and juridical person
vested with full powers and attributes which are described as "legal
personality."
It is worth noting that the term "Authority" has been used to
designate both incorporated and non-incorporated agencies or
instrumentalities of the Government. When the statutory term of a non-
incorporated agency expires, the powers, duties and functions as well as the
assets and liabilities of that agency revert back to, and are re-assumed by, the
Republic of the Philippines, in the absence of special provisions of law
specifying some other disposition thereof such as, e.g., devolution or
transmission of such powers, duties, functions, etc. to some other identified
successor agency or instrumentality of the Republic of the Philippines. When
the expiring agency is an incorporated one, the consequences of such expiry
must be looked for, in the first instance, in the charter of that agency and, by
way of supplementation, in the provisions of the Corporation Code.
The procedural implications of the relationship between an agent or
delegate of the Republic of the Philippines and the Republic itself are, at least
in part, spelled out in the Rules of Court. The general rule is, of course, that
an action must be prosecuted and defended in the name of the real party-in-
interest. (Rule 3, Section 2) The Rules of Court at the same time expressly
recognize the role of representative parties. In the instant case, ISA instituted
the expropriation proceedings in its capacity as an agent or delegate or
representative of the Republic of the Philippines pursuant to its authority
under P.D. No. 272. The present expropriation suit was brought on behalf of
and for the benefit of the Republic as the principal of ISA.
The principal or the real party in interest is thus the Republic of the
Philippines and not the National Steel Corporation, even though the latter
may be an ultimate user of the properties involved should the condemnation
suit be eventually successful. It follows that the Republic of the Philippines is
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ADMIN LAW UNDER ATTY. GALLANT SORIANO
entitled to be substituted in the expropriation proceedings as party-plaintiff in
lieu of ISA, the statutory term of ISA having expired. Put a little differently,
the expiration of ISA's statutory term did not by itself require or justify the
dismissal of the eminent domain proceedings.
The CA declined to permit the substitution of the Republic of the
Philippines for the ISA upon the ground that the action for expropriation
could not prosper because the basis for the proceedings, the ISA's exercise of
its delegated authority to expropriate, had become legally ineffective by
reason of the expiration of the statutory term of the agent or delegate, i.e.,
ISA. Since, as we have held above, the powers and functions of ISA have
reverted to the Republic of the Philippines upon the termination of the
statutory term of ISA, the question should be addressed whether fresh
legislative authority is necessary before the Republic of the Philippines may
continue the expropriation proceedings initiated by its own delegate or agent.
While the power of eminent domain is, in principle, vested primarily
in the legislative department of the government, this Court believes and so
holds that no new legislative act is necessary should the Republic decide,
upon being substituted for ISA, in fact to continue to prosecute the
expropriation proceedings. For the legislative authority, a long time ago,
enacted a continuing or standing delegation of authority to the President of
the Philippines to exercise, or cause the exercise of, the power of eminent
domain on behalf of the Government of the Republic of the Philippines. In
the present case, the President, exercising the power duly delegated under
both the 1917 and 1987 Revised Administrative Codes in effect made a
determination that it was necessary and advantageous to exercise the power
of eminent domain in behalf of the Government of the Republic and
accordingly directed the Solicitor General to proceed with the suit.
Government of the Republic of the Philippines refers to the corporate
governmental entity through which the functions of government are
exercised throughout the Philippines, including, save as the contrary appears
from the context, the various arms through which political authority is made
effective in the Philippines, whether pertaining to the autonomous regions,
HERNANDEZ, LICSI, MARQUEDA, UY
the provincial, city, municipal or barangay subdivisions or other forms of
local government.
Agency of the Government refers to any of the various units of the
Government, including a department, bureau,office instrumentality, or
government-owned or controlled corporation, or a local government or a
distinct unit therein.
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 and controlled corporations.
G.R. No. 84811 August 29, 1989
SOLID HOMES, INC., petitioner, vs. TERESITA PAYAWAL and
COURT OF APPEALS, respondents
DOCTRINE: On the competence of the Board to award damages, we find
that this is part of the exclusive power conferred upon it by PD No. 1344 to
hear and decide "claims involving refund and any other claims filed by
subdivision lot or condominium unit buyers against the project owner,
developer, dealer, broker or salesman."
Statutes conferring powers on their administrative agencies must be liberally
construed to enable them to discharge their assigned duties in accordance
with the legislative purpose.
Facts:
We are asked to reverse a decision of the Court of Appeals sustaining the
jurisdiction of the RTC over a complaint filed by a buyer, the herein private
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respondent, against the petitioner, for delivery of title to a subdivision lot.
The position of the petitioner, the defendant in that action, is that the decision
of the trial court is null and void ab initio because the case should have been
heard and decided by what is now called the Housing and Land Use
Regulatory Board.
The complaint was filed by Teresita Payawal against Solid Homes. The
plaintiff alleged that the defendant contracted to sell to her a subdivision lot
in Marikina for the agreed price of P 28,080.00, and that she had already paid
the defendant the total amount of P 38,949.87 in monthly installments and
interests. Solid Homes subsequently executed a deed of sale over the land but
failed to deliver the corresponding certificate of title despite her repeated
demands because, as it appeared later, the defendant had mortgaged the
property in bad faith to a financing company. The plaintiff asked for delivery
of the title to the lot or, alternatively, the return of all the amounts paid by her
plus interest.
Solid Homes moved to dismiss the complaint on the ground that the court
had no jurisdiction, this being vested in the National Housing Authority. The
motion was denied. The defendant repleaded the objection in its answer,
citing Section 3 of P.D. 957 providing that "the National Housing Authority
shall have exclusive jurisdiction to regulate the real estate trade and business
in accordance with the provisions of this Decree." After trial, judgment was
rendered in favor of the plaintiff and the defendant was ordered to deliver to
her the title to the land or, failing this, to refund to her the sum paid plus
interest from 1975 and until the full amount was paid.
Solid Homes appealed but the decision was affirmed by the respondent court,
which also berated the appellant for its obvious efforts to evade a legitimate
obligation, including its dilatory tactics during the trial. The petitioner was
also reproved for its "gall" in collecting the further amount of P 1,238.47
from the plaintiff purportedly for realty taxes and registration expenses
despite its inability to deliver the title to the land.
HERNANDEZ, LICSI, MARQUEDA, UY
In holding that the trial court had jurisdiction, the respondent court referred
to Section 41 of PD No. 957 itself providing that ‘the rights and remedies
provided in this Decree shall be in addition to any and all other rights and
remedies that may be available under existing laws” and declared that "its
clear and unambiguous tenor undermine(d) the (petitioner's) pretension that
the court a quo was bereft of jurisdiction." The decision also dismissed the
contrary opinion of the Secretary of Justice as impinging on the authority of
the courts of justice.
Issue: Whether the Housing and Land Use Regulatory Board have
jurisdiction over the complaint and not the regional trial court
Held:
The applicable law is PD No. 957, as amended by PD No. 1344, entitled
"Empowering the National Housing Authority to Issue Writs of Execution in
the Enforcement of Its Decisions Under Presidential Decree No. 957." The
language of this section (sec.1) leaves no room for doubt that "exclusive
jurisdiction" over the case between the petitioner and the private respondent
is vested not in the Regional Trial Court but in the National Housing
Authority.
The private respondent contends that the applicable law is BP No. 129, which
confers on regional trial courts jurisdiction to hear and decide (1) all civil
actions in which the subject of the litigation is incapable of pecuniary
estimation; (2) all civil actions which involve the title to, or possession of,
real property, or any interest therein, except actions for forcible entry into and
unlawful detainer of lands or buildings...; (8) all other cases in which the
demand, exclusive of interest and cost or the value of the property in
controversy, amounts to more than P 20,000.00. It stresses, additionally, that
BP No. 129 should control as the later enactment, having been promulgated
in 1981, after PD No. 957 was issued in 1975 and PD No. 1344 in 1978.
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This construction must yield to the familiar canon that in case of conflict
between a general law and a special law, the latter must prevail regardless of
the dates of their enactment. Thus, it has been held that the fact that one law
is special and the other general creates a presumption that the special act is to
be considered as remaining an exception of the general act, one as a general
law of the land and the other as the law of the particular case. The
circumstance that the special law is passed before or after the general act
does not change the principle.
It is obvious that the general law in this case is BP No. 129 and PD No. 1344
the special law.
The argument that the trial court could also assume jurisdiction because of
Section 41 of PD No. 957, earlier quoted, is also unacceptable. We do not
read that provision as vesting concurrent jurisdiction on the Regional Trial
Court and the Board over the complaint mentioned in PD No. 1344 if only
because grants of power are not to be lightly inferred or merely implied. The
only purpose of this section is to reserve to the aggrieved party such other
remedies as may be provided by existing law, like a prosecution for the act
complained of under the Revised Penal Code.
On the competence of the Board to award damages, we find that this is
part of the exclusive power conferred upon it by PD No. 1344 to hear
and decide "claims involving refund and any other claims filed by
subdivision lot or condominium unit buyers against the project owner,
developer, dealer, broker or salesman." It was therefore erroneous for the
respondent to brush aside the well-taken opinion of the Secretary of Justice
that-
Such claim for damages which the subdivision/condominium buyer
may have against the owner, developer, dealer or salesman, being a
necessary consequence of an adjudication of liability for non-
performance of contractual or statutory obligation, may be deemed
necessarily included in the phrase "claims involving refund and any
HERNANDEZ, LICSI, MARQUEDA, UY
other claims" used in the aforequoted subparagraph C of Section 1 of
PD No. 1344. The phrase "any other claims" is, we believe,
sufficiently broad to include any and all claims which are incidental
to or a necessary consequence of the claims/cases specifically
included in the grant of jurisdiction to the National Housing
Authority under the subject provisions.
The same may be said with respect to claims for attorney's fees
which are recoverable either by agreement of the parties or pursuant
to Art. 2208 of the Civil Code (1) when exemplary damages are
awarded and (2) where the defendant acted in gross and evident bad
faith in refusing to satisfy the plaintiff 's plainly valid, just and
demandable claim.
Besides, a strict construction of the subject provisions of PD No.
1344 which would deny the HSRC the authority to adjudicate claims
for damages and for damages and for attorney's fees would result in
multiplicity of suits in that the subdivision condominium buyer who
wins a case in the HSRC and who is thereby deemed entitled to claim
damages and attorney's fees would be forced to litigate in the
regular courts for the purpose, a situation which is obviously not in
the contemplation of the law.
As a result of the growing complexity of the modern society, it has
become necessary to create more and more administrative bodies to help
in the regulation of its ramified activities. Specialized in the particular
fields assigned to them, they can deal with the problems thereof with
more expertise and dispatch than can be expected from the legislature or
the courts of justice. This is the reason for the increasing vesture of
quasi-legislative and quasi-judicial powers in what is now not
unreasonably called the fourth department of the government.
Statutes conferring powers on their administrative agencies must be
liberally construed to enable them to discharge their assigned duties in
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accordance with the legislative purpose. Following this policy in Antipolo
Realty Corp. v. NHA, the Court sustained the competence of the respondent
administrative body, in the exercise of the exclusive jurisdiction vested in it
by PD No. 957 and PD No. 1344, to determine the rights of the parties under
a contract to sell a subdivision lot.
CHRISTIAN GENERAL ASSEMBLY, INC. vs. Spouses Ignacio
G.R. No. 164789. August 27, 2009
FACTS:
Christian General Assembly, Inc. (CGA)entered into a Contract to
Sell a subdivision lot with the respondents spouses Ignacio the registered
owners and developers of a housing subdivision known as Villa Priscilla
Subdivision. Under the Contract to Sell, the parties mutually agreed to extend
the payment period from three to five years on installment basis.
According to CGA, it religiously paid the monthly installments until
its administrative pastor discovered that the title covering the subject
property suffered from fatal flaws and defects. CGA learned that the subject
property was actually part of two consolidated lots that spouses Ignacio had
acquired from Adriano and Sison, the former tenant-beneficiaries Imperial
whose property had been placed under PD No. 27’s Operation Land Transfer.
According to CGA, Imperial applied for the retention of five hectares of her
land under RA No. 6657, which the DAR granted authorizing Imperial to
retain the farm lots previously awarded to the tenant-beneficiaries, including
lot in question.
After discovering these circumstances, CGA filed a complaint
against the respondents before the RTC claiming that that spouses Ignacio
fraudulently concealed the fact that the subject property was part of a
property under litigation thus, the Contract to Sell was a rescissible contract.
Instead of filing an answer, the respondents filed a motion to dismiss
asserting that the RTC had no jurisdiction over the case. Citing PD No. 957
and PD No. 1344, the respondents claimed that the case falls within the
HERNANDEZ, LICSI, MARQUEDA, UY
exclusive jurisdiction of the HLURB since it involved the sale of a
subdivision lot.
The RTC denied the motion to dismiss stating that the action for
rescission of contract and damages due to the respondents’ fraudulent
misrepresentation that they are the rightful owners of the subject property
that is free from all liens and encumbrances is outside the HLURB’s
jurisdiction. The CA, on the other hand, ruled in favor of the spouses Ignacio
holding that HLURB had exclusive jurisdiction over the subject matter of the
complaint since it involved a contract to sell a subdivision lot based on the
provisions of PD No. 957 and PD No. 1344.
ISSUE: Which of the two—the regular court or the HLURB—has exclusive
jurisdiction over CGA’s action for rescission?
RULING:
HLURB has exclusive jurisdiction over the case. PD No. 957 was
intended to closely supervise and regulate the real estate subdivision and
condominium businesses in order to curb the growing number of swindling
and fraudulent manipulations perpetrated by unscrupulous subdivision and
condominium sellers and operators. Section 3 of PD No. 957 granted the
National Housing Authority (NHA) the “exclusive jurisdiction to regulate the
real estate trade and business.” Thereafter, PD No. 1344 was issued to
expand the jurisdiction of the NHA which includes to hear and decide cases
of the following nature:
A. Unsound real estate business practices;
B. Claims involving refund and any other claims filed by
subdivision lot or condominium unit buyer against the project
owner, developer, dealer, broker or salesman; and
C. Cases involving specific performance of contractual and
statutory obligations filed by buyers of subdivision lot or
condominium unit against the owner, developer, dealer, broker or
salesman.
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Thereafter, EO 648 transferred the regulatory and quasi-judicial functions of
the NHA to the Human Settlements Regulatory Commission (HSRC).
Pursuant to EO 90, the HSRC was renamed as the HLURB.
The surge in the real estate business in the country brought with it an
increasing number of cases between subdivision owners/developers and lot
buyers on the issue of the extent of the HLURB’s exclusive jurisdiction. In
the cases that reached us, we have consistently ruled that the HLURB has
exclusive jurisdiction over complaints arising from contracts between the
subdivision developer and the lot buyer or those aimed atcompelling the
subdivision developer to comply with its contractual and statutory
obligations to make thesubdivision a better place to live in. (Rationale for
HLURB’s extensive quasi-judicial powers)
The extent to which the HLURB has been vested with quasi-judicial
authority must also be determined by referring to the terms of P.D. No. 957,
“The Subdivision And Condominium Buyers’ Protective Decree.” Section 3
of this statute provides: x x x National Housing Authority [now HLURB].—
The National Housing Authority shall have exclusive jurisdiction to regulate
the real estate trade and business in accordance with the provisions of this
Decree. The provisions of PD 957 were intended to encompass all questions
regarding subdivisions and condominiums. The intention was aimed at
providing for an appropriate government agency, the HLURB, to which all
parties aggrieved in the implementation of provisions and the enforcement of
contractual rights with respect to said category of real estate may take
recourse. The business of developing subdivisions and corporations being
imbued with public interest and welfare, any question arising from the
exercise of that prerogative should be brought to the HLURB which has the
technical know-how on the matter. In the exercise of its powers, the HLURB
must commonly interpret and apply contracts and determine the rights of
private parties under such contracts. This ancillary power is no longer a
uniquely judicial function, exercisable only by the regular courts.
In the case of Antipolo Realty Corporation vs. NHA, it was held that,
in this era of clogged court dockets, the need for specialized administrative
HERNANDEZ, LICSI, MARQUEDA, UY
boards or commissions with the special knowledge, experience and capability
to hear and determine promptly disputes on technical matters or essentially
factual matters, subject to judicial review in case of grave abuse of discretion,
has become well nigh indispensable. Thus, in 1984, the Court noted that
‘between the power lodged in an administrative body and a court, the
unmistakable trend has been to refer it to the former’. x x x In general, the
quantum of judicial or quasi-judicial powers which an administrative agency
may exercise is defined in the enabling act of such agency. In other words,
the extent to which an administrative entity may exercise such powers
depends largely, if not wholly on the provisions of the statute creating or
empowering such agency. In the exercise of such powers, the agency
concerned must commonly interpret and apply contracts and determine the
rights of private parties under such contracts, one thrust of the multiplication
of administrative agencies is that the interpretation of contracts and the
determination of private rights thereunder is no longer a uniquely judicial
function, exercisable only by our regular courts.
The expansive grant of jurisdiction to the HLURB does not mean,
however, that all cases involving subdivision lots automatically fall under its
jurisdiction. In Roxas v. CA, the mere relationship between the parties, i.e.,
that of being subdivision owner/developer and subdivision lot buyer, does not
automatically vest jurisdiction in the HLURB. For an action to fall within the
exclusive jurisdiction of the HLURB, the decisive element is the nature of
the action as enumerated in Section 1 of P.D. 1344. On this matter, we have
consistently held that the concerned administrative agency, the NHA before
and now the HLURB, has jurisdiction over complaints aimed at compelling
the subdivision developer to comply with its contractual and statutory
obligations. x x x Note particularly pars. (b) and (c) as worded, where the
HLURB’s jurisdiction concerns cases commenced by subdivision lot or
condominium unit buyers. As to par. (a), concerning “unsound real estate
practices,” it would appear that the logical complainant would be the buyers
and customers against the sellers (subdivision owners and developers or
condominium builders and realtors), and not vice versa.
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Pursuant to Roxas, in Pilar Development Corporation v. Villar and
Suntay v. Gocolay, HLURB has no jurisdiction over cases filed by
subdivision or condominium owners or developers against subdivision lot or
condominium unit buyers or owners. The rationale behind this can be found
in the wordings of Section 1, PD No. 1344, which expressly qualifies that the
cases cognizable by the HLURB are those instituted by subdivision or
condomium buyers or owners against the project developer or owner. This is
also in keeping with the policy of the law, which is to curb unscrupulous
practices in the real estate trade and business.
In the cases of Fajardo Jr. v. Freedom to Build, Inc. and Cadimas v.
Carrion, the RTC’s jurisdiction was upheld even if the subject matter was a
subdivision lot since it was the subdivision developer who filed the action
against the buyer for violation of the contract to sell. The only instance that
HLURB may take cognizance of a case filed by the developer is when said
case is instituted as a compulsory counterclaim to a pending case filed
against it by the buyer or owner of a subdivision lot or condominium unit.
Obviously, where it is not clear from the allegations in the complaint
that the property involved is a subdivision lot, the case falls under the
jurisdiction of the regular courts and not the HLURB. Similarly, the RTC had
jurisdiction over a case where the conflict involved a subdivision lot buyer
and a party who owned a number of subdivision lots but was not himself the
subdivision developer.
From these allegations, the main thrust of the CGA complaint is clear
—to compel the respondents to refund the payments already made for the
subject property because the respondents were selling a property that they
apparently did not own. In other words, CGA claims that since the
respondents cannot comply with their obligations under the contract, i.e., to
deliver the property free from all liens and encumbrances, CGA is entitled to
rescind the contract and get a refund of the payments already made. This
cause of action clearly falls under the actions contemplated by par (b),
Section 1 of PD No. 1344, which reads: SECTION 1. In the exercise of its
functions to regulate the real estate trade and business and in addition to its
HERNANDEZ, LICSI, MARQUEDA, UY
powers provided for in PD 957, NHA shall have exclusive jurisdiction to
hear and decide cases of the following nature: x x x B. Claims involving
refund and any other claims filed by subdivision lot or condominium unit
buyer against the project owner, developer, dealer, broker or salesman.
G.R. No. 106498 June 28, 1993
LOLITA DADUBO, petitioner, vs. CIVIL SERVICE COMMISSION and
the DEVELOPMENT BANK OF THE PHILIPPINES, respondents
DOCTRINE: The rule is that the findings of fact of administrative bodies, if
based on substantial evidence, are controlling on the reviewing authority. It is
settled that it is not for the appellate court to substitute its own judgment for
that of the administrative agency on the sufficiency of the evidence and the
credibility of the witnesses. Administrative decisions on matters within their
jurisdiction are entitled to respect and can only be set aside on proof of grave
abuse of discretion, fraud or error of law.
The standard of due process that must be met in administrative tribunals
allows a certain latitude as long as the element of fairness is not ignored.
The constitutional requirement to state clearly and distinctly the facts and the
law on which a decision is based applies only to courts of justice and not to
administrative bodies.
Facts:
Petitioner, Senior Accounts Analyst and Rosario Cidro, Cash Supervisor, of
the Development Bank of the Philippines were administratively charged with
conduct prejudicial to the best interest of the service. The charges were based
on reports on the unposted withdrawal of P60,000.00 from a Savings
Account in the name of Eric Tiu, Edgar Tiu, and/or Pilar Tiu.
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The formal investigations revealed that Erlinda Veloso, authorized
representative of the Tius, presented an undated withdrawal slip. Dadubo, as
acting teller, prepared the corresponding ticket and voucher in the name of
the cash supervisor, Cidro. Dadubo initialed the withdrawal slip, ticket and
voucher and passed on to Cidro all the documents on the said transaction.
These were then forwarded to the accountant, Dorado, who signed the
voucher ledger card of the Tius' savings account and forwarded the
documents to Babaylon, bookkeeper, who was also acting as posting machine
operator. After posting the amount of P60,000.00 on the ledger card and
passbook, Babaylon initialed the withdrawal slip and returned the documents
to Dorado, who approved the withdrawal and thereafter disbursed the
P60,000.00 to Veloso. The Received payment portion of the withdrawal slip
was signed Veloso but Cidro, who disbursed the amount, failed to initial the
passbook.
After banking hours, another withdrawal slip was presented by Feliciano
Bugtas, Jr., also an employee of the Tius. This was the second P60,000.00
withdrawal. Veloso did not know about it. The withdrawal slip was processed
and approved on the same day. The space Posted by was initialed by
Babaylon but no posting was actually made because the passbook was not
presented. While the withdrawal slip was dated August 13, 1987, all other
supporting documents were dated August 14, 1987, this being a withdrawal
after banking hours.
The following day, prior to the payment of the ABH withdrawal, Veloso
presented another undated withdrawal slip for P60,000.00. This was the third
P60,000.00 withdrawal. The withdrawal slip was received by Dorado, who
handed it to Dadubo. At that time, Cidro was encashing the check at PNB to
satisfy the ABH withdrawal. When she returned from the bank, she paid this
withdrawal to Veloso, who thought that what she was collecting was the
P60,000.00 corresponding to the withdrawal slip she presented that morning.
When Dadubo informed Cidro about the third withdrawal, till money of
P100,000.00 was made to service it. Prior to the payment of the third
HERNANDEZ, LICSI, MARQUEDA, UY
P60,000.00 withdrawal, Veloso came back and presented another withdrawal
slip for P40,000.00. The petitioner claimed she disbursed P100,000.00 to
Veloso, covering the third P60,000.00 and the P40,000.00 withdrawals. On
the other hand, Veloso testified that she received only P40,000.00 from the
petitioner. She acknowledged receipt of the amount by signing the
withdrawal slip and indicating opposite her signature the amount of
P40,000.00.
That left the balance of P60,000.00 unaccounted for and directly imputable to
Dadubo.
On the basis of these findings, DBP found Dadubo guilty of dishonesty for
embezzlement of bank funds. She was penalized with dismissal from the
service. Cidro was adjudged guilty of gross neglect of duty and fined in an
amount equivalent to one month basic salary, payable through salary
deductions in not more than 12 installments.
Dadubo appealed to the Merit Systems Protection Board which affirmed the
decision of the DBP.
However, DBP was reversed by the Civil Service Commission in its
Resolution which reduced Dadubo's penalty to suspension for six months on
the ground that although Dadubo made alterations on the dates in the Ledger
Card from August 13 to August 14, the fact remains that the bank was
defrauded on account of said ABH withdrawal (for) which Cidro is held
responsible and accordingly found guilty of Gross Neglect of Duty and
Inefficiency and Incompetence in the Performance of Official Duty. It was
also Dadubo who reported on the irreconcilable P60,000.00. The most that
Dadubo could be charged with is willful violation of office regulation when
she undertook reconciliation for under the Bank Manual the tellers are not
allowed access to the savings account ledger cards.
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Respondent DBP moved reconsideration. The Commission acting favorably
on the motion, promulgated a resolution affirming the earlier findings of the
DBP as to Dadubo guilt, thus —
The records reveal that Dadubo admitted in her Answer that she
changed entry of the date August 13 to 14 in the ledger in the course
of her reconciliation which she was advised not to do. This act of
admission needs no further elaboration to prove that Dadubo is guilty
of the charge. Such admission is however treated as a mitigating
circumstance which is offset by the aggravating circumstance of
taking advantage of her official position. There is no reason for her to
change or alter entries in the ledger unless she intends to benefit
therefrom or to conceal some facts.
Further, it should be noted that the report was made only on
September 28, 1987 (the date the report on reconciliation was
submitted to the Regional Office). It should be emphasized as earlier
stated that Dadubo was not authorized to reconcile the subsidiary
ledger cards for the period ending August 20, 1987. Hence, as
emphatically stated in the MSPB decision, ". . . respondent Dadubo
manipulated the bank records to conceal the offense which
constituted the act of dishonesty."
Dadubo has brought her case to this Court in this petition for certiorari. She
claims that the CSC Resolution failed to comply with the constitutional
requirement to state clearly and distinctly the facts and the law on which the
decision is based; CSC Resolution No. 92-878 conflicts with the findings of
fact in CSC Resolution No. 91-642; the Commission manifestly overlooked
or disregarded certain relevant facts not disputed by the parties; and it based
its conclusions entirely on speculations, surmises or conjectures.
Required to comment, the Solicitor General argued that CSC Resolution No.
92-878 did not need to restate the legal and factual bases of the original
decision in CSC-MSPB No. 497 which already explained the relevant facts
HERNANDEZ, LICSI, MARQUEDA, UY
and the applicable law. The petitioner had admitted that she changed the
entry of the dates in the subsidiary ledger card from August 13 to 14 in the
course of her reconciliation work although she was not authorized to do this.
This admission, along with the other evidence Presented during the
investigation in the bank, proved Dadubo's guilt. Moreover, the affidavit of
Albert Ballicud was inadmissible in evidence because he was never subjected
to cross-examination.
Issue: WON the Civil Service Commission’s resolution failed to comply
with the constitutional requirement to state clearly and distinctly the
facts and the law on which the decision is based
Held:
The rule is that the findings of fact of administrative bodies, if based on
substantial evidence, are controlling on the reviewing authority. It is
settled that it is not for the appellate court to substitute its own judgment
for that of the administrative agency on the sufficiency of the evidence
and the credibility of the witnesses. Administrative decisions on matters
within their jurisdiction are entitled to respect and can only be set aside
on proof of grave abuse of discretion, fraud or error of law. None of these
vices has been shown in this case.
The petitioner's invocation of due process is without merit. Her complaint
that she was not sufficiently informed of the charges against her has no basis.
While the rules governing Judicial trials should be observed as much as
possible, their strict observance is not indispensable in administrative cases.
As this Court has held, "the standard of due process that must be met in
administrative tribunals allows a certain latitude as long as the element
of fairness is not ignored."
The essence of due process is distilled in the immortal cry of Themistocles to
Eurybiades: "Strike, but hear me first!" It simply connotes an opportunity to
be heard. The petitioner had several opportunities to be heard and to present
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evidence that she was not guilty of embezzlement but only of failure to
comply with the tellering procedure. Not only did she testify at her formal
investigation but she also filed a motion for reconsideration with the DBP,
then appealed to the Merit Systems Protection Board, and later elevated the
case to the Civil Service Commission. Having been given all these
opportunities to be heard, which she fully availed of, she cannot now
complain that she was denied due process.
Appreciation of the evidence submitted by the parties was, to repeat, the
prerogative of the administrative body, subject to reversal only upon a
clear showing of arbitrariness. The rejection of the affidavit of Ballicud, for
example, was not improper because there was nothing in that document
showing that the petitioner did not embezzle the money.
It is true that the petitioner was formally charged with conduct prejudicial to
the best interest of the bank and not specifically with embezzlement.
Nevertheless, the allegations and the evidence presented sufficiently proved
her guilt of embezzlement of bank funds, which in unquestionably prejudicial
to the best interest of the bank. The charge against the respondent in an
administrative case need not be drafted with the precision of an information
in a criminal prosecution. It is sufficient that he is apprised of the substance
of the charge against him; what is controlling is the allegation of the acts
complained of, not the designation of the offense.
We must also dismiss the petitioner's complaint that CSC Resolution No.
92-878 failed to comply with the constitutional requirement to state
clearly and distinctly the facts and the law on which a decision is based.
We have held that this provision applies only to courts of justice and not
to administrative bodies like the Civil Service Commission. In any event,
there was an earlier statement of the facts and the law involved in the
decision rendered by the MSPB which affirmed DBP's decision to dismiss
the petitioner. In both decisions, the facts and the law on which they were
based were clearly and distinctly stated.
HERNANDEZ, LICSI, MARQUEDA, UY
It is worth adding that inasmuch as Civil Service Resolution No. 92-878 was
rendered only to resolve DBP's motion for reconsideration, it was not really
necessary to re-state the factual and legal bases for the said decisions. Even
resolutions issued by this Court do not need to conform, to the first paragraph
of Article VIII, Section 14, of the Constitution.
LIANGA BAY LOGGING, CO., INC vs. HON. MANUEL LOPEZ
ENAGE
G.R. No. L-30637. July 16, 1987
FACTS:
The parties herein are both forest concessionaries whose licensed
areas are adjacent to each other. The concession of petitioner Lianga Bay
Logging Corporation Co., Inc. is located in the Province of Surigao while
that of respondent Ago Timber Corporation is located in the Province of
Agusan. It was a part of a forest area originally licensed to one Narciso
Lansang. Since the concessions of petitioner and respondent are adjacent to
each other, they have a common boundary — the Agusan-Surigao Provincial
boundary.
Because of reports of encroachment by both parties on each other's
concession areas, the Director of Forestry ordered a survey to establish on the
ground the common boundary of their respective concession areas. Forester
Cipriano Melchor undertook the survey and fixed the common boundary.
Respondent Ago protested claiming that "its eastern boundary should be the
provincial boundary line of Agusan-Surigao as described in Section 1 of Art.
1693 of the Philippine Commission as indicated in the green pencil in the
attached sketch" of the areas as prepared by the Bureau of Forestry. The
Director of Forestry ruled in favor of petitioner Lianga stating that the claim
of the Ago runs counter to the intentions of the Bureau of Forestry in granting
the license of Mr. Narciso Lansang and Lianga.
Ago appealed to the Department of Agriculture and Natural
Resources (DANR) which then Secretary Jose Y. Feliciano set aside the
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decision and ruled that the common boundary line of Ago and Lianga should
be that indicated by the green line on the same sketch. Petitioner Lianga
elevated the case to the Office of the President (OP) wherein Assistant
Executive Secretary Gilberto Duavit reversed the DANR decision and
reinstated that of the Director of Forestry.
A new action was commenced by Ago in the Court of First Instance
wherein the respondent judge issued a TRO which enjoined the decision of
the OP. Lianga moved for the dismissal of the complaint stating that the court
has no jurisdiction over the public officials and corporation but this was
denied by the court.
ISSUE: Whether or not the trial court has jurisdiction over the case
RULING:
NO. Respondent Judge erred in taking cognizance of the complaint
filed by respondent Ago, asking for the determination anew of the correct
boundary line of its licensed timber area, for the same issue had already been
determined by the Director of Forestry, the Secretary of Agriculture and
Natural Resources and the Office of the President, administrative officials
under whose jurisdictions the matter properly belongs. Section 1816 of the
Revised Administrative Code vests in the Bureau of Forestry, the jurisdiction
and authority over the demarcation, protection, management, reproduction,
reforestation, occupancy, and use of all public forests and forest reserves and
over the granting of licenses for game and fish, and for the taking of forest
products, including stone and earth therefrom. The Secretary of Agriculture
and Natural Resources, as department head, may repeal or modify the
decision of the Director of Forestry when advisable in the public interests,
whose decision is in turn appealable to the Office of the President.
In giving due course to the complaint, the respondent court would
necessarily have to assess and evaluate anew all the evidence presented in the
administrative proceedings, which is beyond its competence and jurisdiction.
For the respondent court to consider and weigh again the evidence already
HERNANDEZ, LICSI, MARQUEDA, UY
presented and passed upon by said officials would be to allow it to substitute
its judgment for that of said officials who are in a better position to consider
and weigh the same in the light of the authority specifically vested in them by
law. Such a posture cannot be entertained, for it is a well-settled doctrine that
the courts of justice will generally not interfere with purely administrative
matters which are addressed to the sound discretion of government agencies
and their expertise unless there is a clear showing that the latter acted
arbitrarily or with grave abuse of discretion or when they have acted in a
capricious and whimsical manner such that their action may amount to an
excess or lack of jurisdiction.
A doctrine long recognized is that where the law confines in an
administrative office the power to determine particular questions or matters,
upon the facts to be presented, the jurisdiction of such office shall prevail
over the courts. The general rule, under the principles of administrative law
in force in this jurisdiction, is that decisions of administrative officers shall
not be disturbed by the courts, except when the former have acted without or
in excess of their jurisdiction, or with grave abuse of discretion. Findings of
administrative officials and agencies who have acquired expertise because
their jurisdiction is confined to specific matters are generally accorded not
only respect but at times even finality of such findings are supported by
substantial evidence. As recently stressed by the Court, "in this era of
clogged court dockets, the need for specialized administrative boards or
commissions with the special knowledge, experience and capability to hear
and determine promptly disputes on technical matters or essentially factual
matters, subject to judicial review in case of grave abuse of discretion, has
become well nigh indispensable."
G.R. No. 112745 October 16, 1997
AQUILINO T. LARIN, petitioner, vs. THE EXECUTIVE SECRETARY,
ET. AL., respondents.
FACTS: A decision was rendered by the Sandiganbayan convicting herein
petitioner, Revenue Specific Tax Officer, then Assistant Commissioner of the
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Excise Tax Division of the Bureau of Internal Revenue and his co-accused of
the crimes of violation of Section 268 (4) of the National Internal Revenue
Code and Section 3 (e) of R.A. 3019.
The fact of petitioner's conviction was reported to the President of the
Philippines by the then Acting Finance Secretary Leong through a
memorandum. The memorandum states, inter alia: “It is clear from the
foregoing that Mr. Larin has been found beyond reasonable doubt to have
committed acts constituting grave misconduct. Under the Civil Service Laws
and Rules which require only preponderance of evidence, grave misconduct
is punishable by dismissal.”
Acting by authority of the President, Sr. Deputy Executive Secretary
Quisumbing issued Memorandum Order No. 164 which provides for the
creation of an Executive Committee to investigate the administrative charge
against herein petitioner. Consequently, the Committee directed the petitioner
to respond to the administrative charge leveled against him through a letter.
In compliance, petitioner submitted a letter which was addressed to Atty.
Lagustan, the Chairman of the Investigating Committee. In said latter, he
asserts that, the case being sub-judice, he may not, therefore, comment on the
merits of the issues involved for fear of being cited in contempt of Court. The
position paper is thus limited to furnishing the Committee pertinent
documents submitted with the Supreme Court and other tribunal which took
cognizance of the case in the past.
In the same letter, petitioner claims that the administrative complaint against
him is already barred: a) on jurisdictional ground as the Office of the
Ombudsman had already taken cognizance of the case and had caused the
filing only of the criminal charges against him, b) by res judicata, c) by
double jeopardy, and d) because to proceed with the case would be
redundant, oppressive and a plain persecution against him.
HERNANDEZ, LICSI, MARQUEDA, UY
Meanwhile, the President issued the challenged Executive Order No. 132
which mandates for the streamlining of the Bureau of Internal Revenue.
Under said order, some positions and functions are either abolished, renamed,
decentralized or transferred to other offices, while other offices are also
created. The Excise Tax Service or the Specific Tax Service, of which
petitioner was the Assistant Commissioner, was one of those offices that was
abolished by said executive order.
One day after the promulgation of Executive Order No. 132, the President
appointed several BIR Assistant Commissioners.
Consequently, the President, in the assailed Administrative Order No. 101,
found petitioner guilty of grave misconduct in the administrative charge and
imposed upon him the penalty of dismissal with forfeiture of his leave credits
and retirement benefits including disqualification for reappointment in the
government service.
Aggrieved, petitioner filed directly with this Court the instant petition to
question basically his alleged unlawful removal from office.
While the instant petition is pending, this Court set aside the conviction of
petitioner in the Criminal Cases.
In his petition, petitioner challenged the authority of the President to dismiss
him from office. He argued that in so far as presidential appointees who are
Career Executive Service Officers are concerned, the President exercises
only the power of control not the power to remove. He also averred that the
administrative investigation conducted is void as it violated his right to due
process. According to him, the letter of the Committee and his position paper
are not sufficient for purposes of complying with the requirements of due
process. He alleged that he was not informed of the administrative charges
leveled against him nor was he given official notice of his dismissal.
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Petitioner likewise claimed that he was removed as a result of the
reorganization made by the Executive Department in the BIR. Thus, he
assailed Executive Order No. 132 and its implementing rules for being ultra
vires. He claimed that there is yet no law enacted by Congress which
authorizes the reorganization by the Executive Department of executive
agencies, particularly the Bureau of Internal Revenue. He said that the
reorganization sought to be effected by the Executive Department is tainted
with bad faith in apparent violation of Section 2 of R.A. 6656, otherwise
known as the Act Protecting the Security of Tenure of Civil Service Officers
and Employees in the Implementation of Government Reorganization.
On the other hand, respondents contended that since petitioner is a
presidential appointee, he falls under the disciplining authority of the
President. They also contended that E.O. No. 132 and its implementing rules
were validly issued pursuant to RA 7645. Apart from this, the other legal
bases of E.O. No. 132 as stated in its preamble are Section 63 of E.O. No.
127 (Reorganizing the Ministry of Finance), and Section 20, Book III of E.O.
No. 292, otherwise known as the Administrative Code of 1987. In addition, it
is clear that in Section 11 of R.A. No. 6656 future reorganization is expressly
contemplated and nothing in said law that prohibits subsequent
reorganization through an executive order. Significantly, respondents
clarified that petitioner was not dismissed by virtue of EO 132. Respondents
claimed that he was removed from office because he was found guilty of
grave misconduct in the administrative cases filed against him.
ISSUE: WON petitioner was validly dismissed from office
HELD:
The position of Assistant Commissioner of the BIR is part of the Career
Executive Service. Under the law, Career Executive Service officers, namely,
Undersecretary, Assistant Secretary, Bureau Director, Assistant Bureau
Director, Regional Director, Assistant Regional Director, Chief of
Department Service and other officers of equivalent rank as may be
HERNANDEZ, LICSI, MARQUEDA, UY
identified by the Career Executive Service Board, are all appointed by the
President. Concededly, petitioner was appointed as Assistant Commissioner
by then President Aquino. Thus, petitioner is a presidential appointee who
belongs to career service of the Civil Service. Being a presidential appointee,
he comes under the direct disciplining authority of the President. This is in
line with the well settled principle that the "power to remove is inherent in
the power to appoint" conferred to the President by Section 16, Article
VII of the Constitution. Thus, it is ineluctably clear that Memorandum
Order No. 164 was issued pursuant to the power of removal of the
President. This power of removal, however, is not an absolute one which
accepts no reservation. It must be pointed out that petitioner is a career
service officer. Under the Administrative Code of 1987, career service is
characterized by the existence of security of tenure, as contra-distinguished
from non-career service whose tenure is co-terminus with that of the
appointing authority or subject to his pleasure, or limited to a period
specified by law or to the duration of a particular project for which purpose
the employment was made. As a career service officer, petitioner enjoys the
right to security of tenure. No less than the 1987 Constitution guarantees the
right of security of tenure of the employees of the civil service. Specifically,
Section 36 of P.D. No. 807, otherwise known as Civil Service Decree of the
Philippines, is emphatic that career service officers and employees who enjoy
security of tenure may be removed only for any of the causes enumerated in
said law. In other words, the fact that petitioner is a presidential appointee
does not give the appointing authority the license to remove him at will or at
his pleasure for it is an admitted fact that he is likewise a career service
officer who under the law is the recipient of tenurial protection, thus, may
only be removed for a cause and in accordance with procedural due process.
Was petitioner then removed from office for a legal cause under a valid
proceeding?
Although the proceedings taken complied with the requirements of
procedural due process, this Court, however, considers that petitioner was not
dismissed for a valid cause.
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It should be noted that what precipitated the creation of the investigative
committee to look into the administrative charge against petitioner is his
conviction by the Sandiganbayan. As admitted by the respondents, the
administrative case against petitioner is based on the Sandiganbayan
Decision.
However, it must be stressed at this juncture that the conviction of petitioner
by the Sandiganbayan was set aside by this Court. We are emphatic in our
resolution in said cases that there is nothing "illegal with the acts committed
by the petitioner(s)." We also declare that "there is no showing that
petitioner(s) had acted irregularly, or performed acts outside of his (their)
official functions." Significantly, these acts which we categorically declare to
be not unlawful and improper are the very same acts for which petitioner is
held to be administratively responsible. Any charge of malfeasance or
misfeasance on the part of the petitioner is clearly belied by our conclusion in
said cases. In the light of this decisive pronouncement, we see no reason for
the administrative charge to continue.
We are not unaware of the rule that since administrative cases are
independent from criminal actions for the same act or omission, the
dismissal or acquittal of the criminal charge does not foreclose the
institution of administrative action nor carry with it the relief from
administrative liability. However, the circumstantial setting of the instant
case sets it miles apart from the foregoing rule and placed it well within the
exception. Corollarily, where the very basis of the administrative case
against petitioner is his conviction in the criminal action which was later
on set aside by this Court upon a categorical and clear finding that the
acts for which he was administratively held liable are not unlawful and
irregular, the acquittal of the petitioner in the criminal case necessarily
entails the dismissal of the administrative action against him, because in
such a case, there is no more basis nor justifiable reason to maintain the
administrative suit.
HERNANDEZ, LICSI, MARQUEDA, UY
On the aspect of procedural due process, suffice it to say that petitioner was
given every chance to present his side. The rule is well settled that the
essence of due process in administrative proceedings is that a party be
afforded a reasonable opportunity to be heard and to submit any
evidence he may have in support of his defense. The records clearly show
that petitioner submitted his letter-response to the administrative charge filed
against him. Aside from his letter, he also submitted various documents
attached as annexes to his letter, all of which are evidences supporting his
defense. Prior to this, he received a letter from the Investigation Committee
requiring him to explain his side concerning the charge.
Let us now examine Executive Order No. 132.
Under its preamble, E.O. No. 132 lays down the legal bases of its issuance,
namely: a) Section 48 and 62 of R.A. No. 7645, b) Section 63 of E.O. No.
127, and c) Section 20, Book III of E.O. No. 292.
Section 48 of R.A. 7645 provides that: “the heads of departments, bureaus
and offices and agencies are hereby directed to identify their respective
activities which are no longer essential in the delivery of public services and
which may be scaled down, phased out or abolished, subject to civil service
rules and regulations. . . . Actual scaling down, phasing out or abolition of
the activities shall be effected pursuant to Circulars or Orders issued for the
purpose by the Office of the President. “
Said provision clearly mentions the acts of "scaling down, phasing out and
abolition" of offices only and does not cover the creation of offices or
transfer of functions. Nevertheless, the act of creating and decentralizing is
included in the subsequent provision of Section 62, which provides that:
“Unless otherwise created by law or directed by the President of the
Philippines, no organizational unit of charges in key positions in any
department or agency shall be authorized in their respective organization
structures and be funded from appropriations by this Act.”
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The foregoing provision evidently shows that the President is authorized to
effect organizational charges including the creation of offices in the
department or agency concerned.
Another legal basis of E.O. No. 132 is Section 20, Book III of E.O. No. 292
which states: “Unless Congress provides otherwise, the President shall
exercise such other powers and functions vested in the President which are
provided for under the laws and which are not specifically enumerated above
or which are not delegated by the President in accordance with law. (residual
powers)
This provision speaks of such other powers vested in the President under the
law. What law then which gives him the power to reorganize? It is PD 1772
which amended PD 1416. These decrees expressly grant the President of
the Philippines the continuing authority to reorganize the national
government, which includes the power to group, consolidate bureaus and
agencies, to abolish offices, to transfer functions, to create and classify
functions, services and activities and to standardize salaries and
materials. The validity of these two decrees are unquestionable. The 1987
Constitution clearly provides that "all laws, decrees, executive orders,
proclamations, letters of instructions and other executive issuances not
inconsistent with this Constitution shall remain operative until amended,
repealed or revoked." So far, there is yet no law amending or repealing said
decrees. Significantly, the Constitution itself recognizes future
reorganizations in the government as what is revealed in Section 16 of Article
XVIII.
However, We can not consider E.O. No. 127 as a legal basis for the
reorganization of the BIR. E.O. 127 should be related to the second
paragraph of Section 11 of Republic Act No. 6656.
Section 11 provides inter alia: “In the case of the 1987 reorganization of the
executive branch, all departments and agencies which are authorized by
executive orders promulgated by the President to reorganize shall have
HERNANDEZ, LICSI, MARQUEDA, UY
ninety days from the approval of this act within which to implement their
respective reorganization plans in accordance with the provisions of this
Act.”
Executive Order No. 127 was part of the 1987 reorganization contemplated
under said provision. Obviously, it had become stale by virtue of the
expiration of the ninety day deadline period. It cannot thus be used as a
proper basis for the reorganization of the BIR. Nevertheless, as shown earlier,
there are other legal bases to sustain the authority of the President to issue the
questioned E.O. NO. 132.
While the President's power to reorganize cannot be denied, this does not
mean however that the reorganization itself is properly made in accordance
with law. Well-settled is the rule that reorganization is regarded as valid
provided it is pursued in good faith. Thus, in Dario vs. Mison, this Court
has had the occasion to clarify that:
As a general rule, a reorganization is carried out in "good faith" if
it is for the purpose of economy or to make bureaucracy more
efficient. In that event no dismissal or separation actually occurs
because the position itself ceases to exist. And in that case the
security of tenure would not be a Chinese wall. Be that as it may, if
the abolition which is nothing else but a separation or removal, is
done for political reasons or purposely to defeat security of tenure, or
otherwise not in good faith, no valid abolition takes place and
whatever abolition is done is void ab initio. There is an invalid
abolition as where there is merely a change of nomenclature of
positions or where claims of economy are belied by the existence of
ample funds.
In this regard, it is worth mentioning that Section 2 of R. A. No. 6656 lists
down the circumstances evidencing bad faith in the removal of employees as
a result of the reorganization, thus:
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The existence of any or some of the following circumstances may be
considered as evidence of bad faith in the removals made as a result
of the reorganization, giving rise to a claim for reinstatement or
reappointment by an aggrieved party:
a) Where there is a significant increase in the number of positions in
the new staffing pattern of the department or agency concerned;
b) Where an office is abolished and another performing substantially
the same functions is created;
c) Where incumbents are replaced by those less qualified in terms of
status of appointment, performance and merit;
d) Where there is a reclassification of offices in the department or
agency concerned and the reclassified offices perform substantially
the same functions as the original offices;
e) Where the removal violates the order of separation provided in
Section 3 hereof.
A reading of some of the provisions of the questioned E.O. No. 132 clearly
leads us to an inescapable conclusion that there are circumstances considered
as evidences of bad faith in the reorganization of the BIR.
Section 1.1.2 of said executive order is a clear illustration of the circumstance
mentioned that an office is abolished and another one performing
substantially the same function is created.
Another circumstance is the creation of services and divisions in the BIR
resulting to a significant increase in the number of positions in the said
bureau as contemplated in paragraph (a) of Section 2 of R.A. No. 6656.
Under Section 1.3 of E.O. No. 132, the Information Systems Group has two
newly created Systems Services. Aside from this, six new divisions are also
HERNANDEZ, LICSI, MARQUEDA, UY
created. Under Section 1.2.1, three more divisions of the Assessment Service
are formed. With these newly created offices, there is no doubt that a
significant increase of positions will correspondingly follow.
Furthermore, it is perceivable that the non-reappointment of the petitioner as
Assistant Commissioner violates Section 4 of R.A. No. 6656. Under said
provision, officers holding permanent appointments are given preference for
appointment to the new positions in the approved staffing pattern comparable
to their former positions or in case there are not enough comparable positions
to positions next lower in rank. It is undeniable that petitioner is a career
executive officer who is holding a permanent position. Hence, he should have
been given preference for appointment in the position of Assistant
Commissioner. As claimed by petitioner, Pangilinan who was one of those
appointed as Assistant Commissioner, "is an outsider of sorts to the Bureau,
not having been an incumbent officer of the Bureau at the time of the
reorganization." We should not lose sight of the second paragraph of Section
4 which explicitly states that no new employees shall be taken in until all
permanent officers shall have been appointed for permanent position.
DARIO vs. MISON
FACTS:
Cory Aquino promulgated Proclamation No. 3, "DECLARING A
NATIONAL POLICY TO IMPLEMENT THE REFORMS MANDATED
BY THE PEOPLE...”, the mandate of the people to Completely
reorganize the government. In January 1987, she promulgated EO 127,
"REORGANIZING THE MINISTRY OF FINANCE". Among other offices,
Executive Order No. 127 provided for the reorganization of the Bureau of
Customs and prescribed a new staffing pattern therefor. In February
1987, a brand new constitution was adopted. On January 1988,
incumbent Commissioner of Customs Salvador Mison issued a
Memorandum, in the nature of "Guidelines on the Implementation of
Reorganization Executive Orders," prescribing the procedure in
personnel placement. It also provided that by February 1988, all employees
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covered by EO 127 and the grace period extended to the Bureau of Customs
by the President on reorganization shall be: a) informed of their re-
appointment, or b) offered another position in the same
department or agency, or c) informed of their termination. A total of
394 officials and employees of the Bureau of Customs were given individual
notices of separation. They filed appeals with the CSC. CSC
promulgated its ruling for reinstatement of the 279 employees.
Mison, filed a motion for reconsideration, which was denied.
Commissioner Mison instituted certiorari proceedings.
ISSUE: WON Section 16 of Article XVIII of the 1987 Constitution is a
grant of a license upon the Government to remove career public officials it
could have validly done under an "automatic"-vacancy-authority and to
remove them without rhyme or reason.
HELD:
NO. The State can still carry out reorganizations provided that it is done in
good faith. Removal of career officials without cause cannot be done after the
passing of the 1987 Constitution.
Section 16 Article XVIII, of the 1987 Constitution:
“Sec. 16. Career civil service employees separated from the service not
for cause but as a result of the reorganization pursuant to Proclamation
No. 3 dated March 25, 1986 and the reorganization following the
ratification of this Constitution shall be entitled to appropriate separation
pay and to retirement and other benefits accruing to them under the laws
of general application in force at the time of their separation. In lieu
thereof, at the option of the employees, they may be considered for
employment in the Government or in any of its subdivisions,
instrumentalities, or agencies, including government-owned or controlled
corporations and their subsidiaries. This provision also applies to
career officers whose resignation, tendered in line with the existing
policy.”
HERNANDEZ, LICSI, MARQUEDA, UY
The above is a mere recognition of the right of the Government
to reorganize its offices, bureaus, and instrumentalities. Under Section
4, Article XVI, of the 1935 Constitution. Transition periods are characterized
by provisions for "automatic" vacancies. They are dictated by the need to
hasten the passage from the old to the new Constitution free from the
"fetters" of due process and security of tenure. Since 1935, transition periods
have been characterized by provisions for "automatic" vacancies. We take the
silence of the 1987 Constitution on this matter as a restraint upon the
Government to dismiss public servants at a moment's notice. If the present
Charter envisioned an "automatic" vacancy, it should have said so in clearer
terms. Plainly the concern of Section 16 is to ensure compensation for
"victims" of constitutional revamps - whether under the Freedom or existing
Constitution - and only secondarily and impliedly, to allow reorganization.
The canon for the removal or suspension of a civil service officer or
employee is that it must be FOR CAUSE. That means "a guarantee of both
procedural and substantive due process. Basically, procedural due process
would require that suspension or dismissal come only after notice and
hearing. Substantive due process would require that suspension or dismissal
be 'for cause'.
The right granted by EO 17 to an employee to be informed of the ground for
his separation must be deemed to have been revoked by the repealing clause
of EO 127 (Section 67) providing that "all laws, ordinances or parts thereof,
which are inconsistent with this Executive Order, are hereby repealed and
modified accordingly.
BUKLOD NANG KAWANING EIIB vs. ZAMORA
FACTS:
The Economic Intelligence and Investigation Bureau (EIIB) of the Ministry
of Finance was created on June 30, 1987 by EO 127 On January 7, 2000 then
President Joseph Estrada issued EO 191deactivating the EIIB. Its function
was transferred to the newly created Task Force Aduana which utilized the
personnel, facilities and resources of existing departments, agencies and
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bureaus. Thus, no new employees were hired. Its personnel came from other
agencies and detailed with the Task Force. On March 29, 2000, EO 223 was
issued separating all EIIB personnel from the service effective April 30,
2000. Aggrieved, petitioners, employees of the EIIB, without exhausting
administrative remedies and the hierarchy of courts, resorted to this recourse
challenging Executive Orders Nos. 191 and 223 as violative of their right to
security of tenure and usurpation by the President of the power of Congress
to abolish public office.
Procedural flaws like the disregard of hierarchy of courts and non-exhaustion
of administrative remedies may be ignored where the demands of public
interest requires it as where the status and existence of public office is in
issue.
ISSUE: WON the president can reorganize the executive department.
HELD:
YES. The general rule is that the power to create and abolish a public office
lies with the Legislature. However, the President by virtue of Section 31,
Book III of EO 292 (Administrative Code of 1987) Section 48 of RA 7645
Section 20, Book III of EO 292 and Section 78 of RA8760 may abolish, in
good faith, bureaus, agencies or offices. In this jurisdiction, reorganizations
have been regarded as valid provided they are pursued in good faith.
Reorganization is carried out in 'good faith' if it is for the purpose of
economy or to make bureaucracy more efficient.
Hence, where an office is abolished to achieve the ultimate purpose of
economy, as in the case at bar, the same is made in good faith.
Also, there exists a distinction between the words "deactivate" and "abolish."
To "deactivate" means to render inactive or ineffective or to break up by
discharging or reassigning personnel, while to "abolish" means to do away
with, to annul, abrogate or destroy completely. In essence, abolition denotes
an intention to do away with the office wholly and permanently. Thus, while
in abolition, the office ceases to exist, the same is not true in deactivation
where the office continues to exist, albeit remaining dormant or inoperative.
HERNANDEZ, LICSI, MARQUEDA, UY
Be that as it may, deactivation and abolition are both reorganization
measures.
DRIANITA BAGAOISAN vs. NATIONAL TOBACCO
ADMINISTRATION (NTA)
G.R. No. 152845. August 5, 2003
FACTS:
President Joseph Estrada EO No. 29, entitled "Mandating the
Streamlining of the National Tobacco Administration (NTA)," a government
agency under the Department of Agriculture. The order was followed by EO
No. 36, amending EO No. 29, insofar as the new staffing pattern was
concerned, by increasing from 400 to not exceeding 750 the positions
affected thereby. In compliance therewith, the NTA prepared and adopted a
new Organization Structure and Staffing Pattern (OSSP) which was approved
by the Department of Budget Management (DBM).
The petitioners rank and file employees of NTA Batac appealed with
the Civil Service Commission and sought its assistance in recalling the OSSP.
Thereafter, the petitioners received individual notices of termination of their
employment with the NTA. Petitioners filed a petition for certiorari,
prohibition and mandamus, with prayer for preliminary mandatory injunction
and/or temporary restraining order with the RTC to declare the notice of
termination and reorganization as null and void. The RTC then ordered the
NTA to appoint petitioners in the new OSSP to positions similar or
comparable to their respective former assignments.
The NTA appealed to the CA which reversed the RTC’s decision. The
petitioners assail the the decision of the CA contending that respondent NTA
was not guilty of bad faith in the termination of the services of petitioners
and erred in upholding Executive Order Nos. 29 and 36 of the Office of the
President which are mere administrative issuances which do not have the
force and effect of a law to warrant abolition of positions and/or effecting
total reorganization. Petitioners submitted a "Motion to Admit Petition For
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En Banc Resolution" of the case allegedly to address a basic question, i.e.,
"the legal and constitutional issue on whether the NTA may be reorganized
by an executive fiat, not by legislative action."
ISSUE: Whether or not the President, through the issuance of an executive
order, can validly carry out the reorganization of the NTA
RULING:
YES. In the case of Buklod ng Kawaning EIIB vs. Zamora, the court
ruled that the President, based on existing laws, had the authority to carry out
a reorganization in any branch or agency of the executive department. The
general rule has always been that the power to abolish a public office is
lodged with the legislature. This proceeds from the legal precept that the
power to create includes the power to destroy. A public office is either
created by the Constitution, by statute, or by authority of law. Thus, except
where the office was created by the Constitution itself, it may be abolished
by the same legislature that brought it into existence. The exception,
however, is that as far as bureaus, agencies or offices in the executive
department are concerned, the President's power of control may justify him
to inactivate the functions of a particular office, or certain laws may grant
him the broad authority to carry out reorganization measures.
It is important to emphasize that the questioned Executive Orders
No. 29 and No. 36 have not abolished the National Tobacco Administration
but merely mandated its reorganization through the streamlining or reduction
of its personnel. Article VII, Section 17, of the Constitution, expressly grants
the President control of all executive departments, bureaus, agencies and
offices which may justify an executive action to inactivate the functions of a
particular office or to carry out reorganization measures under a broad
authority of law. Section 78 of the General Provisions of Republic Act No.
8522 (General Appropriations Act of FY 1998) has decreed that the President
may direct changes in the organization and key positions in any department,
bureau or agency pursuant to Article VI, Section 25, of the Constitution,
which grants to the Executive Department the authority to recommend the
budget necessary for its operation. Evidently, this grant of power includes the
HERNANDEZ, LICSI, MARQUEDA, UY
authority to evaluate each and every government agency, including the
determination of the most economical and efficient staffing pattern, under the
Executive Department.
In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon.
Ronaldo D. Zamora, in his capacity as the Executive Secretary, et al., this
Court has had occasion to also delve on the President's power to reorganize
the Office of the President under Section 31(2) and (3) of Executive Order
No. 292 and the power to reorganize the Office of the President Proper. The
Court has there observed:
". . . Under Section 31(1) of EO 292, the President can reorganize the
Office of the President Proper by abolishing, consolidating or merging
units, or by transferring functions from one unit to another. In contrast, under
Section 31(2) and (3) of EO 292, the President's power to reorganize offices
outside the Office of the President Proper but still within the Office of the
President is limited to merely transferring functions or agencies from the
Office of the President to Departments or Agencies, and vice versa."
The provisions of Section 31, Book III, Chapter 10, of Executive
Order No. 292 (Administrative Code of 1987), above-referred to, reads
thusly:
"SEC. 31. Continuing Authority of the President to Reorganize his
Office. — The President, subject to the policy in the Executive Office and in
order to achieve simplicity, economy and efficiency, shall have continuing
authority to reorganize the administrative structure of the Office of the
President. For this purpose, he may take any of the following actions:
"(1) Restructure the internal organization of the Office of the
President Proper, including the immediate Offices, the Presidential Special
Assistants/Advisers System and the Common Staff Support System, by
abolishing, consolidating or merging units thereof or transferring functions
from one unit to another;
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"(2) Transfer any function under the Office of the President to any
other Department or Agency as well as transfer functions to the Office of the
President from other Departments and Agencies; and
"(3) Transfer any agency under the Office of the President to any
other department or agency as well as transfer agencies to the Office of the
President from other departments and agencies."
The first sentence of the law is an express grant to the President of a
continuing authority to reorganize the administrative structure of the Office
of the President. The succeeding numbered paragraphs are not in the nature
of provisos that unduly limit the aim and scope of the grant to the President
of the power to reorganize but are to be viewed in consonance therewith.
Section 31(1) of Executive Order No. 292 specifically refers to the
President's power to restructure the internal organization of the Office of the
President Proper, by abolishing, consolidating or merging units hereof or
transferring functions from one unit to another, while Section 31(2) and (3)
concern executive offices outside the Office of the President Proper allowing
the President to transfer any function under the Office of the President to any
other Department or Agency and vice-versa, and the transfer of any agency
under the Office of the President to any other department or agency and vice-
versa.
In the present instance, involving neither an abolition nor transfer of
offices, the assailed action is a mere reorganization under the general
provisions of the law consisting mainly of streamlining the NTA in the
interest of simplicity, economy and efficiency. It is an act well within the
authority of President motivated and carried out, according to the findings of
the appellate court, in good faith, a factual assessment that this Court could
only but accept.
G.R. No. 142283 February 6, 2003
ROSA LIGAYA C. DOMINGO, ET.AL., petitioners, vs. ZAMORA, ET.
AL., respondents.
HERNANDEZ, LICSI, MARQUEDA, UY
FACTS:
Former President Estrada issued Executive Order No. 81 entitled
"Transferring the Sports Programs and Activities of the Department of
Education, Culture and Sports to the Philippine Sports Commission and
Defining the Role of DECS in School-Based Sports."
Pursuant to EO 81, former DECS Secretary Andrew Gonzales issued a
Memorandum which temporarily reassigned, in the exigency of the service,
all remaining BPESS (Bureau of Physical Education and School Sports) Staff
to other divisions or bureaus of the DECS.
Secretary Gonzales issued another Memorandum reassigning the BPESS
staff named in the Memorandum to various offices within the DECS.
Petitioners were among the BPESS personnel affected by Memorandum.
Dissatisfied with their reassignment, petitioners filed the instant petition.
In their Petition, petitioners argue that EO 81 is void and unconstitutional for
being an undue legislation by President Estrada. Petitioners maintain that the
President’s issuance of EO 81 violated the principle of separation of powers.
Petitioners also challenge the DECS Memoranda for violating their right to
security of tenure.
Petitioners seek to nullify EO 81 and the DECS Memoranda. Petitioners pray
that this Court prohibit the PSC from performing functions related to school
sports development and that, upon filing of the petition, this Court issue TRO
against respondents to desist from implementing EO 81.
During the pendency of the case, Republic Act No. 9155 otherwise known as
the "Governance of Basic Education Act of 2001", was enacted which
expressly abolished the BPESS and transferred the functions, programs and
activities of the DECS relating to sports competition to the PSC.
ISSUE: WON EO 81 and the DECS Memoranda are valid
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ADMIN LAW UNDER ATTY. GALLANT SORIANO
HELD:
We dismiss this petition for being moot and academic.
The subsequent enactment of RA 9155 has rendered the issues in the present
case moot and academic. Since RA 9155 abolished the BPESS and
transferred the DECS’ functions relating to sports competition to the PSC,
petitioners now admit that "it is no longer plausible to raise any ultra vires
assumption by the PSC of the functions of the BPESS." Moreover, since RA
9155 provides that BPESS personnel not transferred to the PSC shall be
retained by the DECS, petitioners now accept that "the law explicitly protects
and preserves" their right to security of tenure.
Although the issue is already academic, its significance constrains the Court
to point out that Executive Order No. 292 expressly grants the President
continuing authority to reorganize the Office of the President. Section 31
of EO 292 provides: (SEE CODAL)
Since EO 81 is based on the President’s continuing authority under Section
31 (2) and (3) of EO 292, EO 81 is a valid exercise of the President’s
delegated power to reorganize the Office of the President. The law grants
the President this power in recognition of the recurring need of every
President to reorganize his office "to achieve simplicity, economy and
efficiency." The Office of the President is the nerve center of the Executive
Branch. To remain effective and efficient, the Office of the President must be
capable of being shaped and reshaped by the President in the manner he
deems fit to carry out his directives and policies. After all, the Office of the
President is the command post of the President. This is the rationale behind
the President’s continuing authority to reorganize the administrative structure
of the Office of the President.
Under EO 292, the DECS is indisputably a Department of the Executive
Branch. Even if the DECS is not part of the Office of the President, EO 292
clearly authorizes the President to transfer any function or agency of the
HERNANDEZ, LICSI, MARQUEDA, UY
DECS to the Office of the President. Under its charter, the PSC is attached to
the Office of the President. Therefore, the President has the authority to
transfer the "functions, programs and activities of DECS related to sports
development" to the PSC, making EO 81 a valid presidential issuance.
However, the President’s power to reorganize the Office of the President
under EO 292 should be distinguished from his power to reorganize the
Office of the President Proper. Under Section 31 (1) of EO 292, the
President can reorganize the Office of the President Proper by
abolishing, consolidating or merging units, or by transferring functions
from one unit to another. In contrast, under Section 31 (2) and (3) of EO
292, the President’s power to reorganize offices outside the Office of the
President Proper but still within the Office of the President is limited to
merely transferring functions or agencies from the Office of the
President to Departments or Agencies, and vice versa.
This distinction is crucial as it affects the security of tenure of employees.
The abolition of an office in good faith necessarily results in the employee’s
cessation in office, but in such event there is no dismissal or separation
because the office itself ceases to exist. On the other hand, the transfer of
functions or agencies does not result in the employee’s cessation in office
because his office continues to exist although in another department, agency
or office. In the instant case, the BPESS employees who were not transferred
to PSC were at first temporarily, then later permanently reassigned to other
offices of the DECS, ensuring their continued employment. At any rate, RA
9155 now mandates that these employees "shall be retained by the
Department."
MAKATI STOCK EXCHANGE vs. SEC
GR No. L-23004 June 30, 1965
FACTS:
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Makati Stock Exchange was not able to register and operate as a Stock
exchange company when its registration was denied by the SEC because it
objected to the requirement of the SEC regarding "Double Listing- this is one
wherein a new stock exchange company is not permitted to list for trading on
its board, securities already listed in another Stock Exchange." MSE likewise
contended that SEC has no power to impose such requirement. But the SEC
contends that it merely acted "in the public interest" because operation of
two or more exchanges adversely affect the public interest. Under the law,
no stock exchange may do business in the Philippines unless it is previously
registered with the Commission by filing a statement containing the
information described in sec. 17 of the Securities act (Commonwealth Act
83, as amended). It is assumed that the Commission may permit registration
if the section is complied with; if not, it may refuse. And there is now no
question that the section has been complied with, or would be complied with,
except that the Makati Stock Exchange, upon challenging this particular
requirement of the Commission (rule against double listing) may be deemed
to have shown inability or refusal to abide by its rules, and thereby to have
given ground for denying registration.
ISSUE: WON the SEC has the power to promulgate rules
HELD:
None. It is fundamental that an administrative officer has only such powers
as are expressly granted to him by the statute, and these necessarily implied
in the exercise thereof. According to many court precedents, the general
power to "regulate" which the Commission has (Sec. 33) does not imply
authority to prohibit.
The Legislature has specified the conditions under which a stock exchange
may legally obtain a permit (sec. 17, Securities Act); it is not for the
Commission to impose others. If the existence of two competing exchanges
jeopardizes public interest — which is doubtful — let the Congress speak.
Undoubtedly, the opinion and recommendations of the Commission will be
given weight by the Legislature, in judging whether or not to restrict
individual enterprises and business opportunities. But until otherwise
HERNANDEZ, LICSI, MARQUEDA, UY
directed by law, the operation of exchanges should not be so regulated as
practically to create a monopoly by preventing the establishment of other
stock exchanges, and thereby contravening.
TAULE vs. SECRETARY LUIS SANTOS
GR No. 90336 Aug. 12, 1991
FACTS:
On June 18, 1989, the Federation of Associations of Barangay Councils
(FABC) of Catanduanes, composed of eleven (11) members, in their
capacities as Presidents of the Association of Barangay Councils in their
respective municipalities, convened in Virac, Catanduanes with six members
in attendance for the purpose of holding the election of its officers. When the
group decided to hold the election despite the absence of five (5) of its
members, the Provincial Treasurer and the Provincial Election Supervisor
walked out. The election nevertheless proceeded and the result was President
- Ruperto Taule; Vice-President - Allan Aquino; Secretary - Vicente Avila;
Treasurer - Fidel Jacob; Auditor -Leo Sales.
On June 19, 1989, respondent Leandro I. Verceles, Governor of Catanduanes,
sent a letter to respondent Luis T. Santos, the Secretary of Local Government,
protesting the election of the officers of the FABC and seeking its
nullification in view of several flagrant irregularities in the manner it was
conducted. In compliance with the order of respondent Secretary, petitioner
Ruperto Taule as President of the ABC, filed his comment on the letter-
protest of respondent Governor denying the alleged irregularities and
denouncing said respondent Governor for meddling or intervening in the
election of FABC officers which is a purely non-partisan affair and at the
same time requesting for his appointment as a member of the Sangguniang
Panlalawigan of the province being the duly elected President of the FABC in
Catanduanes. On August 4, 1989, respondent Secretary issued a resolution
nullifying the election of the officers of the FABC in Catanduanes held on
June 18, 1989 and ordering a new one to be conducted as early as possible to
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be presided by the Regional Director of Region V of the Department of Local
Government.
ISSUE: WON the Secretary of DILG has jurisdiction over the election
protest?
HELD:
No. The Secretary of Local Government has no jurisdiction to entertain any
protest involving the election of officers of the FABC. He is only vested with
the power to promulgate rules and regulations and to exercise general
supervision over the local government as provided in the Local Government
Code and in the Administrative Code.
It is the exclusive original jurisdiction of the inferior to hear election protest
and the COMELEC have the appellate jurisdiction over it. The jurisdiction of
the COMELEC does not cover protests over the organizational set-up of the
katipunan ng mga barangay composed of popularly elected punong
barangays as prescribed by law whose officers are voted upon by their
respective members. The authority of the COMELEC over the katipunan ng
mga barangay is limited by law to supervision of the election of the
representative of the katipunan concerned to the sanggunian in a particular
level conducted by their own respective organization.
SOLID HOMES, INC. vs. TERESITA PAYAWAL and CA
G.R. No. 84811. August 29, 1989
FACTS:
Teresita Payawal filed a case against Solid Homes before the RTC
alleging that the latter contracted to sell to her a subdivision lot in Marikina.
As Payawal had already paid the monthly installments and interests, Solid
Homes subsequently executed a deed of sale over the land but failed to
deliver the corresponding certificate of title despite her repeated demands
because Solid Homes had mortgaged the property in bad faith to a financing
company.
HERNANDEZ, LICSI, MARQUEDA, UY
Solid Homes moved to dismiss the complaint on the ground that the
court had no jurisdiction, this being vested in the National Housing Authority
under PD No. 957. However, the motion was denied. Thereafter, the trial
court ruled in favor of Payawal ordering Solid Homes to deliver the title to
the land or to refund the money. Solid Homes appealed to the CA but the
latter affirmed the decision of the trial court holding that the trial court had
jurisdiction under Section 41 of PD No. 957.
ISSUE: Whether or not the trial court has jurisdiction over the case
RULING:
NO. The applicable law is PD No. 957, as amended by PD No. 1344,
entitled "Empowering the National Housing Authority to Issue Writs of
Execution in the Enforcement of Its Decisions Under Presidential Decree No.
967." Section 1 of the latter decree provides as follows:
SECTION 1. In the exercise of its function to regulate the real estate
trade and business and in addition to its powers provided for in Presidential
Decree No. 957, the National Housing Authority shall have exclusive
jurisdiction to hear and decide cases of the following nature:
A. Unsound real estate business practices;
B. Claims involving refund and any other claims
filed by subdivision lot or
condominium unit buyer against the project owner, developer,
dealer, broker or salesman; an
C. Cases involving specific performance of
contractual and statutory obligations filed by buyers of subdivision
lot or condominium unit against the owner, developer, dealer, broker
or salesman.
The language of this section leaves no room for doubt that "exclusive
jurisdiction" over the case between the petitioner and the private respondent
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is vested not in the Regional Trial Court but in the National Housing
Authority.
The private respondent contends that the applicable law BP No. 129,
which confers on regional trial courts jurisdiction to hear and decide cases
mentioned in its Section 19. It stresses, additionally, that BP No. 129 should
control as the later enactment, having been promulgated in 1981, after PD
No. 957 was issued in 1975 and PD No. 1344 in 1978.
d In case of conflict between a general law and a special law, the latter
must prevail regardless of the dates of their enactment. Thus, it has been held
that — The fact that one law is special and the other general creates a
presumption that the special act is to be considered as remaining an exception
of the general act, one as a general law of the land and the other as the law of
the particular case.
HERNANDEZ, LICSI, MARQUEDA, UY
It is obvious that the general law in this case is BP No. 129 and PD
No. 1344 the special law.
The circumstance that the special law is passed before or after the
general act does not change the principle. Where the special law is later, it
will be regarded as an exception to, or a qualification of, the prior general
act; and where the general act is later, the special statute will be construed as
remaining an exception to its terms, unless repealed expressly or by
necessary implication.
Statutes conferring powers on their administrative agencies must be
liberally construed to enable them to discharge their assigned duties in
accordance with the legislative purpose. Following this policy in Antipolo
Realty Corporation v. National Housing Authority, the Court sustained the
competence of the respondent administrative body, in the exercise of the
exclusive jurisdiction vested in it by PD No. 957 and PD No. 1344, to
determine the rights of the parties under a contract to sell a subdivision lot.
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