DEPARTMENT OF HEALTH vs. PRISCILLA G. CAMPOSANO, ENRIQUE L. PEREZ, and IMELDA Q. AGUSTIN G.R. No.

157684 April 27, 2005 PANGANIBAN, J.: This is a Petition for Review under Rule 45 of the Rules of Court, assailing Decision of the Court of Appeals setting aside the Resolutions of the CSC. FACTS Respondents Camposano, Perez, and Agustin are former employees of the Department Of HealthNational Capital Region (DOH-NCR). Some concerned DOH-NCR employees filed a complaint before the DOH Resident Ombudsman Ringpis against Dir. Majarais, Acting Administrative Officer III Horacio Cabrera, and respondents, arising out of an alleged anomalous purchase by DOH-NCR of 1,500 bottles of Ferrous Sulfate 250 mg. with Vitamin B Complex and Folic Acid capsules worth P330,000.00 from Lumar Pharmaceutical Laboratory. Thereafter, the Resident Ombudsman submitted an investigation report to the Secretary of Health recommending the filing of a formal administrative charge of Dishonesty and Grave Misconduct against respondents and their co-respondents. Subsequently, , the Secretary of Health filed a formal charge against the respondents and their co-respondents for Grave Misconduct, Dishonesty, and Violation of RA 3019. Afterwards, then Executive Secretary Torres issued A.O No. 298 creating an ad-hoc committee to investigate the administrative case filed against the DOH-NCR employees. The said AO was indorsed to the Presidential Commission Against Graft and Corruption (PCAGC). Consequently, the PCAGC took over the investigation from the DOH. After the investigation, it issued a resolution finding respondents guilty as charged. Then President Ramos issued AO No. 390 dismissing the respondents from service as recommended by the PCAGC in their resolution. Subsequently, the Secretary of Health issued an Order disposing of the case against respondents and Cabrera dismissing them from service. Respondents and Cabrera filed their separate appeal with the CSC which was both denied. Respondents motion for reconsideration was denied on September 30, 1999. While Cabreras motion for reconsideration was denied on January 27, 2000. Respondents, however, received the resolution denying their motion for reconsideration on November 2001 which was promulgated on . Thus, Horacio Cabrera was able to appeal to the CA the CSCs resolutions ahead of respondents. The petition of Cabrera was granted by the CA setting aside the resolutions of the CSC and exonerated Cabrera of the administrative charged against him. Not satisfied with the denial by the CSC of their appeal, respondents brought the matter to the CA which nonetheless used the same legal bases for annulling the CSCs Resolution against
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respondents and held that the PCAGCs jurisdiction over administrative complaints pertained only to presidential appointees. Thus, the Commission had no power to investigate the charges against respondents. Moreover, in simply and completely relying on the PCAGCs findings, the secretary of health failed to comply with administrative due process. Hence, the Petition.

ISSUES: a) Whether or not the PCAGC have jurisdiction to investigate the anomalous transaction involving respondents b) Whether or not the health secretary had disciplinary authority over respondents c) Whether or not a Department Secretary may utilize other officials and report facts from which a decision may be based d) Whether or not the Health Secretary has the competence and authority to decide what action should be taken against officials and employees who have been administratively charged and investigated e) Whether or not the Order of Health Secretary is valid

RULING a) YES. PCAGC have jurisdiction to investigate the anomalous transaction involving respondents. Executive Order No. 151 granted the PCAGC the jurisdiction to investigate administrative complaints against presidential appointees allegedly involved in graft and corruption. From a cursory reading of its provisions, it is evident that EO 151 authorizes the PCAGC to investigate charges against presidential, not non-presidential, appointees. In its Preamble, specifically in its Whereas clauses, the EO specifically tasked the PCAGC to investigate presidential appointees charged with graft and corruption More pointedly, Section 3 states that the Commission shall have jurisdiction over all administrative complaints involving graft and corruption filed in any form or manner against presidential appointees. The Court notes, however, that respondents were not investigated pursuant to EO 151. The investigation was authorized under AO No. 298, which had created an Ad Hoc Committee to look into the administrative charges filed against respondents.The Investigating Committee was composed of all the members of the PCAGC. The Chief Executives power to create the Ad Hoc Investigating Committee cannot be doubted. Having been constitutionally granted full control of the Executive Department, to which respondents belong, the President has the obligation to ensure that all executive officials and employees faithfully comply with the law. With AO 298 as mandate, the legality of the investigation is sustained. Such validity is not affected by the fact that the investigating team and the PCAGC had the same composition, or that the former used the offices and facilities of the latter in conducting the inquiry. Parenthetically, the perceived vacuum in EO 151 with regard to cases involving nonpresidential appointees was rectified in Executive Order No. 12. which created the PAGC. Non-

presidential appointees who may have acted in conspiracy, or who may have been involved with a presidential appointee, may now be investigated by the PAGC.

b) YES. The Administrative Code of 1987 vests department secretaries with the authority to investigate and decide matters involving disciplinary actions for officers and employees under the formers jurisdiction. Thus, the health secretary had disciplinary authority over respondents. Note that being a presidential appointee, Dr. Rosalinda Majarais was under the jurisdiction of the President, in line with the principle that the power to remove is inherent in the power to appoint. While the Chief Executive directly dismissed her from the service, he nonetheless recognized the health secretarys disciplinary authority over respondents when he remanded the PCAGCs findings against them for the secretarys appropriate action.

c) YES. As a matter of administrative procedure, a department secretary may utilize other officials to investigate and report the facts from which a decision may be based. In the present case, the secretary effectively delegated the power to investigate to the PCAGC. Neither the PCAGC under EO 151 nor the Ad Hoc Investigating Committee created under AO 298 had the power to impose any administrative sanctions directly. Their authority was limited to conducting investigations and preparing their findings and recommendations. The power to impose sanctions belonged to the disciplining authority, who had to observe due process prior to imposing penalties.

d) YES. The health secretary has the competence and the authority to decide what action should be taken against officials and employees who have been administratively charged and investigated. However, the actual exercise of the disciplining authoritys prerogative requires a prior independent consideration of the law and the facts. Failure to comply with this requirement results in an invalid decision. The disciplining authority should not merely and solely rely on an investigators recommendation, but must personally weigh and assess the evidence gathered. There can be no shortcuts, because at stake are the honor, the reputation, and the livelihood of the person administratively charged. In the present case, the health secretarys two-page Order dismissing respondents pales in comparison with the presidential action with regard to Dr. Majarais. Prior to the issuance of his seven-page decision, President Fidel V. Ramos conducted a restudy of the doctors case. He even noted a violation that had not been considered by the PCAGC. On the other hand, Health Secretary Reodica simply and blindly relied on the dispositive portion of the Commissions Resolution. She even misquoted it by inadvertently omitting the recommendation with regard to Respondents Enrique L. Perez and Imelda Q. Agustin.

e) NO. While the Health Secretary has the power as mentioned above, Due process in administrative proceedings requires compliance with the following cardinal principles: (1) the respondents right to a hearing, which includes the right to present ones case and submit supporting evidence, must be observed; (2) the tribunal must consider the evidence presented; (3)
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the decision must have some basis to support itself; (4) there must be substantial evidence; (5) the decision must be rendered on the evidence presented at the hearing, or at least contained in the record and disclosed to the parties affected; (6) in arriving at a decision, the tribunal must have acted on its own consideration of the law and the facts of the controversy and must not have simply accepted the views of a subordinate; and (7) the decision must be rendered in such manner that respondents would know the reasons for it and the various issues involved. The CA correctly ruled that administrative due process had not been observed in the present factual milieu Furthermore, The Order of Secretary Reodica denying respondents Motion for Reconsideration also failed to correct the deficiency in the initial Order. She improperly relied on the Presidents findings in AO 390 which, however, pertained only to the administrative charge against Dr. Majarais, not against respondents. To repeat, the Chief Executive recognized that the disciplinary jurisdiction over respondents belonged to the health secretary who should have followed the manner in which the President had rendered his action on the recommendation. The Presidents endorsement of the records of the case for the appropriate action of the health secretary did not constitute a directive for the immediate dismissal of respondents. Like that of President Ramos, the decision of Secretary Reodica should have contained a factual finding and a legal assessment of the controversy to enable respondents to know the bases for their dismissal and thereafter prepare their appeal intelligently, if they so desired. Inasmuch as the health secretarys twin Orders were patently void for want of due process, the CA did not err in refusing to discuss the merit of the PCAGCs or the Ad Hoc Committees recommendations. Such a discussion should have been made by the health secretary before it could be passed upon by the CA. In representation of petitioner, the Office of the Solicitor General insists that respondents are guilty of the charges and, like Dr. Majarais, deserve dismissal from the service. Suffice it to stress that the issue in this case is not the guilt of respondents, but solely due process.

ADJUDICATION WHEREFORE, the petition is partly granted. the assailed decision of the court of appeals is modified in the sense that the authority of the ad hoc investigating committee created under administrative order 298 is sustained. Being violative of administrative due process, the orders of the health secretary are annulled and set aside.

RAMON P. BINAMIRA, petitioner, vs. PETER D. GARRUCHO, JR., respondent. G.R. No. 92008. July 30, 1990. En Banc FACTS: A memorandum designating Ramon Binamira as General Manager of Philippine Tourism Authority (PTA) was addressed and signed by the then Minister of Tourism and the Ex-officio Chairman of PTA. The Minister sought the approval of the delegation to the president and the same was granted. Concomitantly, Binamira assumed office as general manager on the same date that the memorandum was sent. Allegedly, Binamira discharged duties as the PTA general manager and ex-officio vice chairman. Said discharged is even purported to have been acknowledge by the president. However, after sometime, Peter Garrucho, as the newly appointed secretary of tourism demanded for Binamira's resignation which was pursuant to a memorandum that then Pres. Aquino sent to the former advising him of the invalidity of the delegation of the position to Binamira as he was not appointed by the president which was what was required under PD 564. PD 564 is the law that created the Ministry of Tourism. Under section 23-A of the decree, the General Manager shall be appointed by the President of the Philippines and shall serve for a term of six (6) years unless sooner removed for cause. When Binamira was ousted, Garrucho took over his place as general manager, still in pursuance with the memorandum sent by Pres. Aquino. On account of the foregoing events, Binamira filed a petition for quo warranto question Garrucho's post and prayed for reinstatement claiming unjust dismissal. Pending said case, he filed a supplemental petition impleading Jose Capistrano who was the appointed general manager. ISSUE: Whether or not the appointment of Binamira is proper and thus does not warrant his recall. HELD: Distinction between appointment and designation should be outlined; such that: Appointment is the selection, by the authority vested with the power, of an individual who is to exercise the functions of a given office. When completed, usually with its confirmation, the appointment results in security of tenure for the person chosen unless he is replaceable at pleasure because of the nature of his office. Designation, on the other hand, connotes merely the imposition by law of additional duties on an incumbent official - as where, in the case before us, the Secretary of Tourism is designated Chairman of the Board of Directors of the Philippine Tourism Authority, or where, under the Constitution, three Justices of the Supreme Court are designated by the Chief Justice to sit in the Electoral Tribunal of the Senate or the House of Representatives. It is said that appointment is essentially executive while designation is legislative in nature. Also, where the person is merely designated and not appointed, the implication is that he shall hold the office only in a temporary capacity and may be replaced at will by the appointing authority. In this sense, the designation is considered only an acting or temporary appointment, which does not confer security of tenure on the person named.

Even if so understood, that is, as an appointment, the designation of the petitioner cannot sustain his claim that he has been illegally removed. The reason is that the decree clearly provides that the appointment of the General Manager of the Philippine Tourism Authority shall be made by the President of the Philippines, not by any other officer. Appointment involves the exercise of discretion, which because of its nature cannot be delegated. Legally speaking, it was not possible for Minister Gonzales to assume the exercise of that discretion as an alter ego of the President. The appointment (or designation) of the petitioner was not a merely mechanical or ministerial act that could be validly performed by a subordinate even if he happened as in this case to be a member of the Cabinet. Moreover, the argument that the designation made by Minister Gonzales was approved by President Aquino through her approval of the composition of the Board of Directors of the PTA is not persuasive. It must be remembered that Binamira was included therein as ViceChairman only because of his designation as PTA General Manager by Minister Gonzales. Such designation being merely provisional, it could be recalled at will, as in fact it was recalled by the President herself, through the memorandum she addressed to Secretary Garrucho on January 4, 1990. Furthermore, designation being an unlawful encroachment on a presidential prerogative, he did not acquire valid title thereunder to the position in question. Even if it be assumed that it could be and was authorized, the designation signified merely a temporary or acting appointment that could be legally withdrawn at pleasure, as in fact it was (albeit for a different reason). In either case, the petitioner's claim of security of tenure must be rejected.

SOUTHERN CROSS CEMENT CORPORATION, petitioner, vs. CEMENT MANUFACTURERS ASSOCIATION OF THE PHILIPPINES, THE SECRETARY OF THE DEPARTMENT OF TRADE AND INDUSTRY, THE SECRETARY OF THE DEPARTMENT OF FINANCE and THE COMMISSIONER OF THE BUREAU OF CUSTOMS, respondents. G.R. No. 158540, (2005) En Banc, Tinga, J., FACTS: This is a petition filed by public respondents Department of Trade and Industry (DTI) and private respondent Philippine Cement Manufacturers Corporation (Philcemcor) seeking reconsideration of the Courts decision, which granted the petition of petitioner Southern Cross Cement Corporation (Southern Cross). The case centers on the interpretation of the provisions of Republic Act No. 8800, the Safeguard Measures Act (SMA). The SMA provides for the structure and mechanics for the imposition of emergency measures, including tariffs, to protect domestic industries and producers from increased imports which inflict or could inflict serious injury on them. Philcemcor filed with the Department of Trade and Industry a petition seeking for the imposition of safeguard measures on Gray Portland cement, in accordance with the SMA. After the DTI issued a provisional safeguard measure, the application was referred to the Tariff Commission for a formal investigation pursuant to Section 9 of the SMA and its Implementing Rules and Regulations, in order to determine whether or not to impose a definitive safeguard measure on imports of Gay Portland cement. After public hearings and conducting its own investigation, the Tariff Commission came out with a negative finding. The DTI sought the opinion of the Secretary of Justice whether it could still impose a definitive safeguard measure. The Secretary of Justice opined that the DTI could not do so under the SMA, and so the DTI Secretary then promulgated a Decision wherein he expressed the DTIs disagreement with the conclusions of the Tariff Commission, but at the same time, ultimately denying Philcemcors application for safeguard measures on the ground that the he was bound to do so in light of the Tariff Commissions negative findings. Philcemcor then filed with the Court of Appeals a Petition for Certiorari, Prohibition and Mandamus seeking to set aside the DTI decision, as well as the Tariff Commissions Report. It argued that the DTI Secretary, vested as he is under the law with the power of review, is not bound to adopt the recommendations of the Tariff Commission; and, that the Report is void, as it is predicated on a flawed framework, inconsistent inferences and erroneous methodology. Though the appellate court refused to annul the findings of the Tariff Commission, it held that the DTI Secretary was not bound by the factual findings of the Tariff Commission since such findings are merely recommendatory and they fall within the ambit of the Secretarys discretionary review. It determined that the legislative intent is to grant the DTI Secretary the power to make a final decision on the Tariff Commissions recommendation. Southern Cross filed the present petition, arguing that the factual findings of the Tariff Commission on the existence or non-existence of conditions warranting the imposition of general safeguard measures are binding upon the DTI Secretary. Despite the fact that the Court of Appeals decision had not yet become final, the DTI Secretary issued a new decision citing that there was no longer any legal impediment to his deciding Philcemcors application for definitive safeguard measures. He made a determination that, contrary to the findings of the Tariff Commission, the local cement industry had suffered
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serious injury as a result of the import surges and accordingly imposed a definitive safeguard measure on the importation of Gray Portland cement. The Southern Cross filed with the Court a Very Urgent Application for a Temporary Restraining Order and/or A Writ of Preliminary Injunction, seeking to enjoin the DTI Secretary from enforcing his decision in view of the pending petition before this Court. After giving due course to Southern Crosss petition, the Court called the case for oral argument and thereafter granted Southern Crosss petition. The Court ruled that the Court of Appeals erred in ruling that the DTI Secretary was not bound by the negative determination of the Tariff Commission and could therefore impose the general safeguard measures, since Section 5 of the SMA precisely required that the Tariff Commission make a positive final determination before the DTI Secretary could impose these measures. Accordingly, the decision of the Court of Appeals was declared null and void. The Court likewise nullified the new decision of the DTI Secretary, which had cited the obligatory force of the null and void Court of Appeals decision, notwithstanding the fact that the decision of the appellate court was not yet final and executory. Considering that the decision of the Court of Appeals was a nullity to begin with, the inescapable conclusion was that the new decision of the DTI Secretary, prescinding as it did from the imprimatur of the decision of the Court of Appeals, was a nullity as well. Both respondents promptly filed their respective motions for reconsideration. The Court En Banc resolved, upon motion of respondents, to accept the petition and resolve the Motions for Reconsideration. The case was then reheard on oral argument. Subsequent to the rendition of the Courts Decision, Philcemcor filed a Petition for Extension of the Safeguard Measure with the DTI, which has been referred to the Tariff Commission. In an Urgent Motion, Southern Cross prayed that Philcemcor, the DTI, the Bureau of Customs, and the Tariff Commission be directed to cease and desist from taking any and all actions pursuant to or under the null and void CA Decision and DTI Decision, including proceedings to extend the safeguard measure. In a Manifestation and Motion, the Tariff Commission informed the Court that since no prohibitory injunction or order of such nature had been issued by any court against the Tariff Commission, the Commission proceeded to complete its investigation on the petition for extension, pursuant to Section 9 of the SMA, but opted to defer transmittal of its report to the DTI Secretary pending guidance from this Court on the propriety of such a step considering this pending Motion for Reconsideration. In a resolution, the Court directed the parties to maintain the status quo effective of even date, and until further orders from the Court. ISSUES: 1. Whether or not the DTI Secretary is bound by the Tariff Commissions factual findings on the existence or nonexistence of conditions warranting the imposition of safeguard measures 2. Whether or not the DTI Secretary has power of review over final determination of the Tariff Commission

RULING:
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1. Yes. The DTI Secretary is barred from imposing a general safeguard measure absent a positive final determination rendered by the Tariff Commission. The required positive final determination of the Tariff Commission exists as a properly enacted constitutional limitation imposed on the delegation of the legislative power to impose tariffs and imposts to the President under Section 28(2), Article VI of the Constitution. The provision states: The Congress may, by law, authorize the President to fix within specified limits, and subject to such limitations and restrictions as it may impose, tariff rates, import and export quotas, tonnage and wharfage dues, and other duties or imposts within the framework of the national development program of the Government. The Court acknowledges the basic postulates ingrained in the provision, and, hence, governing in this case, to wit: (1) It is Congress which authorizes the President to impose tariff rates, import and export quotas, tonnage and wharfage dues, and other duties or imposts. (2) The authorization granted to the President must be embodied in a law. (3) The authorization to the President can be exercised only within the specified limits set in the law and is further subject to limitations and restrictions which Congress may impose. These impositions under Section 28(2), Article VI fall within the realm of the power of taxation, a power which is within the sole province of the legislature. But this provision is also an exceptional grant of legislative power to the President which is why the qualifiers mandated by the Constitution on this presidential authority attains primordial consideration. First, there must be a law, such as the SMA. Second, there must be specified limits, a detail which would be filled in by the law. And Third, Congress is further empowered to impose limitations and restrictions on this presidential authority. The authority delegated to the President may be exercised by his/her alter egos, such as department secretaries. For purposes of the Presidents exercise of power to impose tariffs under the above provision, it is generally the Secretary of Finance who acts as the alter ego of the President. The SMA provides an exceptional instance wherein it is the DTI or Agriculture Secretary who is tasked by Congress, in their capacities as alter egos of the President, to impose such measures. Both the Tariff Commission and the DTI Secretary may be regarded as agents of Congress in the implementation of the said law. Indeed, even the President may be considered as an agent of Congress for the purpose of imposing safeguard measures since it is Congress, not the President, which possesses inherent powers to impose tariffs and imposts. The entire SMA provides for a limited framework under which the President, through the DTI and Agriculture Secretaries, may impose safeguard measures in the form of tariffs and similar imposts. The limitation most relevant to this case is contained in Section 5 of the SMA, captioned Conditions for the Application of General Safeguard Measures, and stating: The Secretary shall apply a general safeguard measure upon a positive final determination of the Tariff Commission that a product is being imported into the country in increased quantities, whether absolute or relative to the domestic production, as to be a substantial cause of serious injury or threat thereof to the domestic industry; however, in the case of non-agricultural products, the Secretary shall first establish that the application of such safeguard measures will be in the public interest. Section 5 of the SMA operates as a limitation validly imposed by Congress on the presidential authority under the SMA to impose tariffs and imposts. The positive final
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determination by the Tariff Commission is plainly required by the law and so it must be strictly complied with. Philcemcor raised a question as to whether such requirement run counter to the courts legal order since under the said provision, a body of relative junior competence as a Tariff Commission can bind an administrative superior and cabinet officer such as the DTI Secretary. No provision in the SMA expressly authorizes the DTI Secretary to impose a general safeguard measure despite the absence of a positive final recommendation of the Tariff Commission. On the other hand, Section 5 expressly states that the DTI Secretary shall apply a general safeguard measure upon a positive final determination of the Tariff Commission. Under the SMA, it is the Tariff Commission that conducts an investigation as to whether the conditions exist to warrant the imposition of the safeguard measures. These conditions are enumerated in Section 5, namely; that a product is being imported into the country in increased quantities, whether absolute or relative to the domestic production, as to be a substantial cause of serious injury or threat thereof to the domestic industry. After the investigation of the Tariff Commission, it submits a report to the DTI Secretary, which states whether the above-stated conditions for the imposition of the general safeguard measures exist. Upon a positive final determination that these conditions are present, the Tariff Commission then is mandated to recommend what appropriate safeguard measures should be undertaken by the DTI Secretary. Section 13 of the SMA gives five specific options on the type of safeguard measures the Tariff Commission recommends to the DTI Secretary. At the same time, nothing in the SMA obliges the DTI Secretary to adopt the recommendations made by the Tariff Commission. In fact, the SMA requires that the DTI Secretary establish that the application of such safeguard measures is in the public interest, notwithstanding the Tariff Commissions recommendation on the appropriate safeguard measure upon its positive final determination. Thus, even if the Tariff Commission makes a positive final determination, the DTI Secretary may opt not to impose a general safeguard measure, or choose a different type of safeguard measure other than that recommended by the Tariff Commission. It is evident from the text of Section 5 that there must be a positive final determination by the Tariff Commission that a product is being imported into the country in increased quantities (whether absolute or relative to domestic production), as to be a substantial cause of serious injury or threat to the domestic industry. The Tariff Commissions finding is not merely recommendatory. Section 5 bluntly does require a positive final determination by the Tariff Commission before the DTI Secretary may impose a general safeguard measure. This is a duty imposed on a public officer by the law itself which must be given a controlling effect. In fact, the Department of Justice Secretary himself rendered an Opinion with the same conclusion. 2. No, the DTI Secretary, acting as alter ego of the President or in his capacity as head of an executive department, may not review, modify or otherwise alter the final determination of the Tariff Commission under the SMA. Congress in enacting the SMA and prescribing the roles to be played therein by the Tariff Commission and the DTI Secretary did not envision that the President, or his/her alter ego, could exercise supervisory powers over the Tariff Commission. If Congress intended to allow the traditional alter ego principle to be established by the SMA , it would have assigned the role now played by the DTI Secretary under the law instead to the

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National Economic and Development Authority (NEDA). The Tariff Commission is an attached agency of the NEDA, which in turn is the independent planning agency of the government. The Tariff Commission does not fall under the administrative supervision of the DTI. On the other hand, the administrative relationship between the NEDA and the Tariff Commission is established not only by the Administrative Code, but similarly affirmed by the Tariff and Customs Code. At the same time, under the Tariff and Customs Code, no similar role or influence is allocated to the DTI in the matter of imposing tariff duties. In fact, the long-standing tradition has been for the Tariff Commission and the DTI to proceed independently in the exercise of their respective functions. Only very recently have our statutes directed any significant interplay between the Tariff Commission and the DTI, with the enactment in 1999 of Republic Act No. 8751 on the imposition of countervailing duties and Republic Act No. 8752 on the imposition of anti-dumping duties, and of course the promulgation a year later of the SMA. In all these three laws, the Tariff Commission is tasked, upon referral of the matter by the DTI, to determine whether the factual conditions exist to warrant the imposition by the DTI of a countervailing duty, an anti-dumping duty, or a general safeguard measure, respectively. In all three laws, the determination by the Tariff Commission that these required factual conditions exist is necessary before the DTI Secretary may impose the corresponding duty or safeguard measure. And in all three laws, there is no express provision authorizing the DTI Secretary to reverse the factual determination of the Tariff Commission. The SMA indubitably establishes that the Tariff Commission is no mere flunky of the DTI Secretary when it mandates that the positive final recommendation of the former be indispensable to the latters imposition of a general safeguard measure. What the law indicates instead is a relationship of interdependence between two bodies independent of each other under the Administrative Code and the SMA alike. Indeed, even the ability of the DTI Secretary to disregard the Tariff Commissions recommendations as to the particular safeguard measures to be imposed evinces the independence from each other of these two bodies. This is properly so for two reasons the DTI and the Tariff Commission are independent of each other under the Administrative Code; and impropriety is avoided in cases wherein the DTI itself is the one seeking the imposition of the general safeguard measures, pursuant to Section 6 of the SMA. Considering that the power to impose tariffs in the first place is not inherent in the President but arises only from congressional grant, the court should affirm the congressional prerogative to impose limitations and restrictions on such powers which do not normally belong to the executive in the first place. Nowhere in the SMA does it state that the DTI Secretary may impose general safeguard measures without a positive final determination by the Tariff Commission, or that the DTI Secretary may reverse or even review the factual determination made by the Tariff Commission. Congress can enact additional tasks or responsibilities on either the Tariff Commission or the DTI Secretary, such as their respective roles on the imposition of general safeguard measures under the SMA. In doing so, the same Congress, which has the putative authority to abolish the Tariff Commission or the DTI, is similarly empowered to alter or expand its functions through modalities which do not align with established norms in the bureaucratic structure. The Court is bound to recognize the legislative prerogative to prescribe such modalities, no matter how atypical they may be, in affirmation of the legislative power to restructure the executive branch of government.

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Assuming administrative review were available, it is the NEDA that may conduct such review following the principles of administrative law, and the NEDAs decision in turn is reviewable by the Office of the President. The decision of the Office of the President then effectively substitutes as the determination of the Tariff Commission, which now forms the basis of the DTI Secretarys decision, which now would be ripe for judicial review by the CTA under Section 29 of the SMA. This is the only way that administrative review of the Tariff Commissions determination may be sustained without violating the SMA and its constitutional restrictions and limitations, as well as administrative law. In any event, even if the Court concedes the possibility of administrative review of the Tariff Commissions final determination by the NEDA, such would not deny merit to the present petition. It does not change the fact that the Court of Appeals erred in ruling that the DTI Secretary was not bound by the negative final determination of the Tariff Commission, or that the DTI Secretary acted without jurisdiction when he imposed general safeguard measures despite the absence of the statutory positive final determination of the Commission.

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BUKLOD NG KAWANING EIIB v. ZAMORA

Buklod ng Kawaning EIIB, et al., Petitioners, vs. Hon. Executive Secretary Ronaldo B. Zamora, et al., Respondents.

G.R. No. 142801-802

July 10, 2001

En Banc

Sandoval-Gutierrez, J.:

This is a petition for certiorari, prohibition and mandamus filed by the petitioners seeking the nullification of Executive Order No. 191 and Executive Order No. 223 on the ground that they were issued by the Office of the President with grave abuse of discretion and in violation of their constitutional right to security of tenure.

FACTS: The Economic Intelligence and Investigation Bureau (EIIB) was created as part of the structural organization of the Ministry of Finance through the issuance of Executive Order No. 127 by former President Corazon Aquino. The EIIB was tasked to: evaluate intelligence reports, gather evidence on illegal activities affecting the national economy and aid in the prosecution of cases; coordinate with external agencies in monitoring financial and economic activities of persons or entities which may adversely affect national financial interest; provide for the guidelines in the conduct of intelligence and investigation operations; and perform such other appropriate functions. The EIIB was assigned to primarily conduct anti-smuggling operations in areas outside the jurisdiction of the Bureau of Customs by virtue of Memorandum Order No. 225 issued by former president Aquino. Subsequently, former President Joseph Estrada issued Executive Order No. 191 ordering the deactivation of the EIIB and the transfer of its functions to the Bureau of Customs and the National Bureau of Investigation on the ground that: the designated functions of the EIIB are also being performed by the other existing agencies of the government; and that there is a need to constantly monitor the overlapping of functions among these agencies. Executive Order No. 196 was issued creating the Presidential Anti-Smuggling Task Force Aduana. He also issued Executive Order No. 223 whereby all EIIB personnel occupying positions specified therein were separated from the service pursuant to a bona fide reorganization resulting to abolition, redundancy, merger, division, or consolidation of positions. Aggrieved, petitioners filed the present case invoking the courts power of judicial review of Executive Order Nos. 191 and 223. Petitioners contend that the issuance of the said executive orders is: (a) a violation of their right to security of tenure; (b) tainted with bad faith as they were not actually intended to make the bureaucracy more efficient but to give way to Task Force

Aduana the functions of which are essentially and substantially the same as that of EIIB; and (c) a usurpation of the power of Congress to decide whether or not to abolish the EIIB. On the other hand, the Solicitor General maintains that: (a) the President enjoys the totality of the executive power provided under Sections 1 and 7, Article VII of the Constitution, thus, he has the authority to issue Executive Order Nos. 191 and 223; (b) the said executive orders were issued in the interest of national economy, to avoid duplicity of work and to streamline the functions of the bureaucracy; and (c) the EIIB was only deactivated and not abolished.

ISSUES: 1. Whether or not the President has the authority to carry out reorganization in any branch or agency of the executive department. 2. Whether or not the reorganization in this case is valid.

RULING: 1. Yes. The President is empowered by the Administrative Code to validly reorganize his office even without congressional authority in order to achieve economy and efficiency. 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 is that, as far as bureaus, agencies or offices in the executive department are concerned, the Presidents power of control may justify him to inactivate the functions of a particular office, or certain laws may grant him the broad authority to carry out reorganization measures. In the whereas clause of Executive Order No. 191, former President Estrada anchored his authority to deactivate EIIB on Section 77 of Republic Act 8745, the General Appropriations Act for fiscal year 1999. It provides: Sec. 77. Organized Changes. Unless otherwise provided by law or directed by the President of the Philippines, no changes in key positions or organizational units in any department or agency shall be authorized in their respective organizational structures and funded from appropriations provided by this Act. The Supreme Court said that the above provision recognizes the authority of the President to effect organizational changes in the department or agency under the executive structure. Such a ruling further finds support in Section 78 of Republic Act No. 8760. Under this law, the heads of departments, bureaus, offices and agencies and other entities in the Executive Branch are mandated to conduct actual streamlining and productivity improvement in agency organization and operation shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President.

Under Section 31, Book III of Executive Order No. 292, the Administrative Code of 1987, the President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have the continuing authority to reorganize the administrative structure of the Office of the President. For this purpose, he may transfer the functions of other Departments or Agencies to the Office of the President. The EIIB is a bureau attached to the Department of Finance. It falls under the Office of the President. Hence, it is subject to the Presidents continuing authority to reorganize.

2. Yes. The reorganization is valid. The Solicitor General invoked the distinction between deactivation and abolition. 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. Abolition denotes an intention to do away with the office wholly and permanently. 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. Deactivation and abolition are both reorganization measures. As far as bureaus, agencies or offices in the executive department is concerned, the Presidents power of control may justify him to inactivate the function of a particular office or certain law may grant him the broad authority to carry out reorganization measure. An examination of the pertinent Executive Orders shows that the deactivation of EIIB and the creation of Task Force Aduana were done in good faith. It was not for the purpose of removing the EIIB employees, but to achieve the ultimate purpose of E.O. No. 191, which is economy. While Task Force Aduana was created to take the place of EIIB, its creation does not entail expense to the government. Firstly, there is no employment of new personnel to man the Task Force. E.O. No. 196 provides that the technical, administrative and special staffs of EIIB are to be composed of people who are already in the public service, they being employees of other existing agencies. Secondly, the thrust of E.O. No. 196 is to have a small group of military men under the direct control and supervision of the President as base of the governments anti-smuggling campaign. The idea is to encourage the utilization of personnel, facilities and resources of the already existing departments instead of maintaining an independent office with a whole set of personnel and facilities. And thirdly, it is evident from the yearly budget appropriation of the government that the creation of the Task Force Aduana was especially intended to lessen EIIBs expenses. Reorganizations in this jurisdiction have been regarded as valid provided they are pursued in good faith. As a general rule, a reorganization is carried out in good faith if it is for the purpose of economy or to make bureaucracy more efficient. In that event, no dismissal or separation actually occurs because the position itself ceases to exist. If the abolition, which is nothing else but a separation or removal, is done for political reasons or purposely to defeat security of tenure, otherwise not in good faith, no valid abolition takes and whatever abolitio 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 the present case, petitioners right to security of tenure is not violate because the abolition of EIIB within the competence of a legitimate body is done in good faith and suffers from no infirmity. Valid abolition of offices is neither removal nor separation of the incumbents. Hence, the petition was denied for lack of merit.

Francisco Abellar Jr., v. Civil Service Commission [Case Digest]

G.R. No. 152574. November 17, 2004

Francisco Abellar Jr., v. Civil Service Commission

G.R. No. 152574. November 17, 2004

Facts:
Petitioner is a retired lawyer retired from the Philippine Economic Zone Authority (PEZA) formerly known as Export Processing Zone Authority (EPZA) as a Department Manager of the Legal Services Department. He held civil service eligibility for the position of Department Manager, having completed the training program for Executive Leadership and Management in 1982 under the Civil Service Academy, pursuant to CSC Resolution No. 850 dated April 16, 1979, which was then the required eligibility for said position. On May 31, 1994, the Civil Service Commission issued Memorandum Circular No. 21, series of 1994, the pertinent provisions of which read:
1. Positions Covered by the Career Executive Service xxx b. xxx xxx

In addition to the above identified positions and other positions of the same category which had been previously classified and included in the CES, all other third level positions of equivalent category in all branches and instrumentalities of the national government, including government owned and controlled corporations with original charters are embraced within the Career Executive Service provided that they meet the following criteria: 1. 2. 3. the position is a career position; the position is above division chief level; and the duties and responsibilities of the position require the performance of executive or managerial functions.

4. Status of Appointment of Incumbents of Positions Included Under the Coverage of the CES. Incumbents of
positions which are declared to be Career Executive Service positions for the first time pursuant to this Resolution who hold permanent appointments thereto shall remain under permanent status in their respective positions. However, upon promotion or transfer to other Career Executive Service (CES) positions, these incumbents shall be under temporary status in said other CES positions until they qualify.

Two years after his retirement, petitioner was hired by the Subic Bay Metropolitan Authority (SBMA) on a contractual basis. On January 1, 1999, petitioner was issued by SBMA a permanent employment as Department Manager III, Labor and Employment Center. However, when said appointment was submitted to respondent Civil Service Commission Regional Office No. III, it was disapproved on the ground that petitioners eligibility was not appropriate. Petitioner was advised by SBMA of the disapproval of his appointment. In view thereof, petitioner was issued a temporary appointment as Department Manager III, Labor and Employment Center, SBMA on July 9, 1999. Petitioner appealed the disapproval of his permanent appointment by respondent to the Civil Service Commission, which issued Resolution No. 000059, dated January 10, 2000,
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Francisco Abellar Jr., v. Civil Service Commission [Case Digest]

G.R. No. 152574. November 17, 2004

affirming the action taken by respondent. Petitioners motion for reconsideration thereof was denied by the CSC in Resolution No. 001143 dated May 11, 2000. Petitioner then went to the Court of Appeals and filed a petition for review assailing the constitutionality of the CSC Memorandum Circular No. 21 which was the basis of the resolutions of the CSC dated January 10, 2000 and May 11, 2000 respectively. The Court of appeals avoided the issue of the constitutionality of CSC Resolution No. 21 because as cited in CSC Memorandum Circular 40, s. 1998 and Mathay v. Civil Service Commission, the appellate court ruled that only the appointing officer may request reconsideration of the action taken by the CSC on appointments. Thus, it held that petitioner did not have legal standing to question the disapproval of his appointment. On reconsideration, the CA added that petitioner was not the real party in interest, as his appointment was dependent on the CSCs approval. Accordingly, he had no vested right in the office, since his appointment was disapproved.

Issues:
1. Whether or not petitioner has the legal personality to question the disapproval of the CSC of his appointment. 2. Whether or not CSC has the power to affirm or deny an appointment of a government employee. 3. Whether or not petitioners right to due process was violated.

Held:
1. The Court held that there is justification to allow the appointing authority to challenge the CSC disapproval1, there is none to preclude the appointee from taking the same course of action. Aggrieved parties including the CSC should be given the right to file motions for appeal or motions for reconsiderations. Hence the concepts of legal standing2 and real party in interest3 become relevant. Although petitioner had no vested right to the position, it was his eligibility that was being questioned. Corollary to this point, he should be granted the opportunity to prove his
1

The appointing authority must have the right to contest the disapproval since said disapproval is a challenge to the exercise of the appointing authoritys discretion. Section 2 of Rule VI of CSC Memorandum Circular 40, s. 1998 allows the appointing authority to request reconsideration or appeal. Furthermore, in Central Bank v CSC (171 SCRA 733, April 10, 1989), the appointing authority that stands to be adversely affected by the disapproval of the CSC, the former may defend the appointment. 2 Legal standing is granted to challenge the constitutionality or validity of a law or governmental act despite the lack of personal injury on the challengers part. 3 A real party in interest is one who would be benefited or injured by the judgment, or one entitled to the avails of the suit. Interest within the meaning of the rule means material interest or an interest in issue and to be affected by the decree, as distinguished from mere interest in the question involved or a mere incidental interest. Otherwise stated, the rule refers to a real or present substantial interest as distinguished from a mere expectancy; or from a future, contingent, subordinate, or consequential interest. As a general rule, one who has no right or interest to protect cannot invoke the jurisdiction of the court as a party-plaintiff in an action.

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Francisco Abellar Jr., v. Civil Service Commission [Case Digest]

G.R. No. 152574. November 17, 2004

eligibility. He had a personal stake in the outcome of the case, which justifies his challenge to the CSC act that denied his permanent appointment. Based from the aforementioned, the appointing authority is adversely affected by the CSCs Order and is a real party in interest, hitting on the same vein, the appointee is rightly a real party in interest too because he is also injured by the CSC disapproval--he is prevented from assuming the office in a permanent capacity. Moreover, he would necessarily benefit if a favourable judgment is obtained, as an approved appointment would confer on him all the rights and privileges of a permanent appointee. Hence, petitioner has legal personality to challenge the disapproval of his permanent appointment by the CSC. 2. The Constitution mandates that, as the central personnel agency of the government, the CSC should establish a career service and adopt measures to promote the morale, efficiency, integrity, responsiveness, progressiveness, and courtesy in the Civil Service. It further requires that appointments in the civil service be made only through merit and fitness to be determined by competitive examination. Civil Service laws have expressly empowered the CSC to issue and enforce rules and regulations to carry out its mandate. In the exercise of its authority, the CSC deemed it appropriate to clearly define and identify positions covered by the Career Executive Service. Logically, the CSC had to issue guidelines to meet this objective, specifically through the issuance of the challenged Circular. The appointing officer and the CSC acting together consecutively, make an appointment complete. In acting on the appointment, the CSC determines whether the appointee possesses the appropriate civil service eligibility or the required qualifications. If the appointee does, the appointment must be approved; if not, it should be disapproved. The challenged Circular protects the rights of incumbents as long as they remain in the positions to which they were previously appointed. They are allowed to retain their positions in a permanent capacity, notwithstanding the lack of Career Service Executive Eligibility (CSEE). Clearly, the Circular recognizes the rule of prospective application of regulations. The government service of petitioner ended when he retired in 1996; thus, his right to remain in a Career Executive Service (CES) position, notwithstanding his lack of eligibility, also ceased. Upon his reemployment years later as department manager III which is a CES position at SBMA in 2001, it was necessary for him to comply with the eligibility prescribed at the time for that position. Thus petitioner must comply with the requirement as provided for by the regulations namely, CSEE4.

The challenged Circular did not revoke petitioners ELM eligibility. Petitioner however needed to have a CSEE in order to qualify for a CES position.

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G.R. No. 152574. November 17, 2004

Thus, given that petitioner lacked the eligibility as required by the regulations promulgated by the CSC, the latter was correct in denying the permanent appointment of the former. 3. In exercising its quasi-judicial function, an administrative body adjudicates the rights of persons before it, in accordance with the standards laid down by the law. The determination of facts and the applicable law, as basis for official action and the exercise of judicial discretion, are essential for the performance of this function. On these considerations, it is elementary that due process requirements. These requirements include prior notice and hearing. On the other hand, quasi-legislative power is exercised by administrative agencies through the promulgation of rules and regulations within the confines of the granting statute and the doctrine of non-delegation of certain powers flowing from the separation of the great branches of the government. Prior notice to and hearing of every affected party, as elements of due process, are not required since there is no determination of past events or facts that have to be established or ascertained. As a general rule, prior notice and hearing are not essential to the validity of rules or regulations promulgated to govern future conduct. Significantly, the challenged Circular was an internal matter addressed to heads of departments, bureaus and agencies. It needed no prior publication, since it had been issued as an incident of the administrative bodys power to issue guidelines for government officials to follow in performing their duties. WHEREFORE, the Petition is GRANTED insofar as it seeks legal standing for petitioner, but DENIED insofar as it prays for the reversal of the CSC Resolutions disapproving his appointment as department manager III of the Labor and Employment Center, Subic Bay Metropolitan Authority.

Page 4 of 4

YAZAKI TORRES MANUFACTURING, INC. v CA G.R. No. 130584 June 27, 2006 2nd Division SANDOVAL-GUTIERREZ, J.: Facts: The Home Development Mutual Fund (HDMF) is the government agency tasked with the administration of the PAG-IBIG Fund (Fund) P.D. No. 1530. The Fund has been intended for housing purposes to be sourced from voluntary contributions from its members. On December 14, 1980, it was amended by P.D. No. 1752 providing that membership in the Fund is mandatory for all gainfully-employed Filipinos. And on June 17, 1994, P.D. No. 1752 was amended by RA No. 7742. Here, the coverage of the Fund extends to all members of the SSS and GSIS, as well as their employers. The HDMF Board of Trustees promulgated Rules and Regulations implementing R.A. No. 7742. Rule VII provides for the waiver or suspension of coverage by an employer and/or employee group who has an existing provident retirement plan or housing plan. Petitioner Yazaki Torres Manufacturing, Inc. applied for and was granted by the HDMF a waiver from the Fund coverage for the period from January 1 to December 31, 1995. The HDMF found that petitioners retirement plan for its employees is superior to that offered by the Fund. On September 1, 1995, the HDMF Board of Trustees amended Rule VII of the Rules and Regulations enjoining the retirement plan and housing plan as one requirement for the application After its waiver from the Fund coverage lapsed, petitioner applied for a renewal. The ground relied upon was once again its "superior retirement plan" to that of the Fund. This time, HDMF disapproved petitioners application on the ground that its retirement plan is not superior to that provided by the Fund. Under the original Implementing Rules and Regulations of the HDMF, superior retirement plan and superior housing plan were separate and alternative grounds for the waiver of the Fund coverage. However, under the Amended Rules and Regulations, superior retirement plan and superior housing plan are joint requirements. Since petitioner does not have a housing plan, this is the reason why its retirement plan was not considered superior to that of the Fund. Hence, its application for renewal of waiver was denied. Consequently, it insists that the HDMF exceeded its authority when it amended its original Rules and Regulations. Petitioner appealed to the HDMF Board of Trustees, but the Board denied the appeal. Petitioner filed with the Court of Appeals a petition for review, which denied the same. Petitioner filed its Motion for Reconsideration, but it was denied. Hence, the instant petition for certiorari. Issue: Whether or not HDMF has the power to amend the implementing Rules and Regulations, thus resulting to the rule that "the power to make laws include the power to alter or repeal the same." Held: Yes. The grant of waiver or exemption from the coverage of the Fund is but a mere privilege granted by the State. A privilege is a particular and peculiar benefit or advantage enjoyed by a person, company, or class beyond the common advantages of other citizens. Like any other privilege or

exemption, it may be withdrawn by the State on a finding that the recipient is no longer entitled to it. There is no provision whatsoever in R.A. No. 7742 or its Implementing Rules and Regulations that the HDMF shall automatically renew a waiver from the Fund coverage upon an application for renewal. The task of determining whether such application should be granted is best discharged by the HDMF, not by the courts. Nature of Legislative Power The legislative power has been described generally as the power to make, alter, and repeal laws. The authority to amend, change, or modify a law is thus part of such legislative power. It is the peculiar province of the legislature to prescribe general rules for the government of society. However, the legislature cannot foresee every contingency involved in a particular problem that it seeks to address. Thus, it has become customary for it to delegate to instrumentalities of the executive department, known as administrative agencies, the power to make rules and regulations. This is because statutes are generally couched in general terms which express the policies, purposes, objectives, remedies and sanctions intended by the legislature. The details and manner of carrying out the law are left to the administrative agency charged with its implementation. In this sense, rules and regulations promulgated by an administrative agency are the product of a delegated power to create new or additional legal provisions that have the effect of law.9 Hence, in general, rules and regulations issued by an administrative agency, pursuant to the authority conferred upon it by law, have the force and effect, or partake of the nature, of a statute.10 The law delegated to the HDMF the rule-making power since this is necessary for the proper exercise of its authority to administer the Fund. Following the doctrine of necessary implication, this grant of express power to formulate implementing rules and regulations must necessarily include the power to amend, revise, alter, or repeal the same. WHEREFORE, the petition is DISMISSED. The decision of CA is AFFIRMED IN TOTO..

BLAS F. OPLE, petitioner, vs. RUBEN D. TORRES, ALEXANDER AGUIRRE, HECTOR VILLANUEVA, CIELITO HABITO, ROBERT BARBERS, CARMENCITA REODICA, CESAR SARINO, RENATO VALENCIA, TOMAS P. AFRICA, HEAD OF THE NATIONAL COMPUTER CENTER and CHAIRMAN OF THE COMMISSION ON AUDIT, respondents.
[G.R. No. 127685. July 23, 1998]
PUNO, J.:

FACTS: The petition at bar is a commendable effort on the part of Senator Blas F. Ople to prevent the shrinking of the right to privacy, which the revered Mr. Justice Brandeis considered as "the most comprehensive of rights and the right most valued by civilized men." Petitioner Ople prays that we invalidate Administrative Order No. 308 entitled "Adoption of a National Computerized Identification Reference System" on two important constitutional grounds, viz: one, it is a usurpation of the power of Congress to legislate, and two, it impermissibly intrudes on our citizenry's protected zone of privacy. Administrative Order No. 308 was issued by President Fidel Ramos On December 12, 1996 and was published in four newspapers of general circulation on January 22, 1997 and January 23, 1997. On January 24, 1997, petitioner filed the instant petition against respondents, then Executive Secretary Ruben Torres and the heads of the government agencies, who as members of the Inter-Agency Coordinating Committee, are charged with the implementation of A.O. No. 308. Senator Blas F. Ople filed a petition seeking to invalidate A.O. No. 308 on several grounds. The issuance of A.O. No.308 by the President is an unconstitutional usurpation of the legislative powers of congress. Petitioner claims that A.O. No. 308 is not a mere administrative order but a law and hence, beyond the power of the President to issue. He alleges that A.O. No.308 establishes a system of identification that is all-encompassing in scope, affects the life and liberty of every Filipino citizen and foreign resident, and more particularly, violates their right to privacy. On this point, respondents counter-argue that: A.O. No. 308 was issued within the executive and administrative powers of the president without encroaching on the legislative powers of congress. ISSUE: Whether the issuance of A.O. No. 308 is an unconstitutional usurpation of the power of Congress to legislate. RULING: Petitioner Ople is a distinguished member of our Senate. As a Senator, petitioner is possessed of the requisite standing to bring suit raising the issue that the issuance of A.O. No. 308 is a usurpation of legislative power. As taxpayer and member of the Government Service Insurance System (GSIS),

petitioner can also impugn the legality of the misalignment of public funds and the misuse of GSIS funds to implement A.O. No. 308.Legislative power is the authority to make laws, and to alter and repeal them. The Constitution has vested this power in the Congress. The grant of legislative power to Congress is broad, general, and comprehensive. Any power deemed to be legislative by usage and tradition, is necessarily possessed by Congress, unless the Constitution has lodged it elsewhere. The executive power, on the other hand, is vested in the President. It is generally defined as the power to enforce and administer the laws. It is the power of carrying the laws into practical operation and enforcing their due observance. As head of the Executive Department, the President is the Chief Executive. He represents the government as a whole and sees to it that all laws are enforced by the officials and employees of his department. He has control over the executive department, bureaus and offices. Corollary to the power of control, the President also has the duty of supervising the enforcement of laws for the maintenance of general peace and public order. Thus, he is granted administrative power over bureaus and offices under his control to enable him to discharge his duties effectively. Administrative power is concerned with the work of applying policies and enforcingorders as determined by proper governmental organs. It enables the President to fix a uniform standard of administrative efficiency and check the official conduct of his agents. To this end, he can issue administrative orders, rules and regulations. From these precepts, the Court holds that A.O. No. 308 involves a subject that is not appropriate to be covered by an administrative order. IN VIEW WHEREOF, the petition is granted and Administrative Order No. 308 entitled "Adoption of a National Computerized Identification Reference System" declared null and void for being unconstitutional. SO ORDERED.

G.R. No. 173034

October 9, 2007

PHARMACEUTICAL AND HEALTH CARE ASSOCIATION OF THE PHILIPPINES, petitioner, vs. HEALTH SECRETARY FRANCISCO T. DUQUE III; HEALTH UNDER SECRETARIES DR. ETHELYN P. NIETO, DR. MARGARITA M. GALON, ATTY. ALEXANDER A. PADILLA, & DR. JADE F. DEL MUNDO; and ASSISTANT SECRETARIES DR. MARIO C. VILLAVERDE, DR. DAVID J. LOZADA, AND DR. NEMESIO T. GAKO,respondents. AUSTRIA-MARTINEZ, J.: Facts: Before the Court is a petition for certiorari under Rule 65 of the Rules of Court, seeking to nullify Administrative Order (A.O.) No. 2006-0012 entitled, Revised Implementing Rules and Regulations of Executive Order No. 51, Otherwise Known as The "Milk Code," Relevant International Agreements, Penalizing Violations Thereof, and for Other Purposes (RIRR). Petitioner posits that the RIRR is not valid as it contains provisions that are not constitutional and go beyond the law it is supposed to implement. Named as respondents are the Health Secretary, Undersecretaries, and Assistant Secretaries of the Department of Health (DOH). For purposes of herein petition, the DOH is deemed impleaded as a co-respondent since respondents issued the questioned RIRR in their capacity as officials of said executive agency. Executive Order No. 51 (Milk Code) was issued by President Corazon Aquino on October 28, 1986 by virtue of the legislative powers granted to the president under the Freedom Constitution. One of the preambular clauses of the Milk Code states that the law seeks to give effect to Article 11 of the International Code of Marketing of Breastmilk Substitutes (ICMBS), a code adopted by the World Health Assembly (WHA) in 1981. From 1982 to 2006, the WHA adopted several Resolutions to the effect that breastfeeding should be supported, promoted and protected, hence, it should be ensured that nutrition and health claims are not permitted for breastmilk substitutes. In 1990, the Philippines ratified the International Convention on the Rights of the Child. The said instrument provides that State Parties should take appropriate measures to diminish infant and child mortality, and ensure that all segments of society, specially parents and children, are informed of the advantages of breastfeeding. On May 15, 2006, the DOH issued herein assailed RIRR which was to take effect on July 7, 2006. However, on June 28, 2006, petitioner, representing its members that are manufacturers of breastmilk substitutes, filed the present Petition for Certiorari and Prohibition with Prayer for the Issuance of a Temporary Restraining Order (TRO) or Writ of Preliminary Injunction. The main issue raised in the petition is whether respondents officers of the DOH acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and in violation of the provisions of the Constitution in promulgating the RIRR. On August 15, 2006, the Court issued a Resolution granting a TRO enjoining respondents from implementing the questioned RIRR.

After the Comment and Reply had been filed, the Court set the case for oral arguments on June 19, 2007. The Court issued an Advisory (Guidance for Oral Arguments) dated June 5, 2007. The parties filed their respective memoranda. Issues: 1. Whether or not the petitioners are real party-in-interest. 2. Whether or not the administrative agency possesses the power to amend, revise, alter, or repeal the rules and regulations that it made in the exercise of its rule making power.

Ruling: 1. Yes. An association has standing to file suit for its workers despite its lack of direct interest if its members are affected by the action. An organization has standing to assert the concerns of its constituents. The association is the appropriate party to assert the rights of its members, because it and its members are in every practical sense identical. The association is but the medium through which its individual members seek to make more effective the expression of their voices and the redress of their grievances. It represents directly or through approved representatives the pharmaceutical and health care industry before the Philippine Government and any of its agencies, the medical professions and the general public. Hence, petitioner, whose legal identity is deemed fused with its members, should be considered as a real party-in-interest which stands to be benefited or injured by any judgment in the present action.

2. Yes. An administrative agency like respondent possesses quasi-legislative or rule-making power or the power to make rules and regulations which results in delegated legislation that is within the confines of the granting statute and the Constitution, and subject to the doctrine of non-delegability and separability of powers. Such express grant of rule-making power necessarily includes the power to amend, revise, alter, or repeal the same. This is to allow administrative agencies flexibility in formulating and adjusting the details and manner by which they are to implement the provisions of a law, in order to make it more responsive to the times. Hence, it is a standard provision in administrative rules that prior issuances of administrative agencies that are inconsistent therewith are declared repealed or modified.

Chanell

PANGASINAN TRANSPORTATION CO., INC., petitioner, vs. THE PUBLIC SERVICE COMMISSION, respondent. G.R. No. 47065. June 26, 1940. LAUREL, J. FACTS Petitioner Pangasinan Transportation Co., Inc. has been engaged for the past twenty years in the business of transporting passengers in the Province of Pangasinan and Tarlac and, to a certain extent, in the Province of Nueva Ecija and Zambales, by means of motor vehicles commonly known as TPU buses, in accordance with the terms and conditions of the certificates of public convenience issued in its favor by the former Public Utility Commission now public service commission. Petitioner filed with the Public Service Commission an application for authorization to operate ten additional new Brockway trucks, on the ground that they were needed to comply with the terms and conditions of its existing certificates and as a result of the application of the Eight Hour Labor Law. The public respondent granted the application with the following conditions; a. Certificates of public convenience and AUTHORIZATION above shall be valid and subsisting only during twenty-five (25) years, counted from the date of the enactment of this decision. b. That the applicant company may be acquired by the Commonwealth of the Philippines or any agency thereof at any time it so desires payment of the price d cost of useful equipment, less a reasonable depreciation that has been set by the commission while of their acquisition. Not being agreeable to the two new conditions thus incorporated in its existing certificates, the petitioner filed on October 9, 1939 a motion for reconsideration which was denied by the Public Service Commission. On November 20, 1939, the petitioner filed before the SC a petition for a writ of certiorari praying for the declaration of nullity of section 1 of Commonwealth Act No. 454 or should the SC declared the same to be constitutional, that it will not be applicable to valid and subsisting certificates issued prior to June 8, 1939. Thus, petitioner contends; a. That the legislative powers granted to Commission by the said law is without limitation, guide or rule except the unfettered discretion and judgment of the Commission, constitute a complete and total abdication by the Legislature of its functions in the premises. b. That even if it be assumed that section 1 of Commonwealth Act No. 454, is valid delegation of legislative powers, the Commission has exceeded its authority because the Act applies only to future certificates and not to valid and subsisting certificates issued prior to June 8, 1939, when said Act took effect and the Act, as applied by the Commission, violates constitutional guarantees. ISSUES a. WON Section 1 of Commonwealth Act No. 454 is unconstitutional being a total abdication by the legislature of its functions which constitutes an invalid delegation. b. WON the said Act is applicable to valid and subsisting certificates. RULING

A. Section 1 of Commonwealth Act No. 454 is constitutional. All that has been delegated to the Commission is the administrative function, involving the use discretion, to carry out the will of the National Assembly (legislative) having in view, in addition, the promotion of "public interests in a proper and suitable manner." This is clearly shown in the requisite before the issuance of the certificate which states that the Commission must necessarily be satisfied that the operation of the service under said certificate during a definite period fixed therein "will promote the public interests in a proper and suitable manner." The fact that the National Assembly may itself exercise the function and authority thus conferred upon the Public Service Commission does not make the provision in question constitutionally objectionable. The Act neither violates the principle of separation of powers which is designed by its originators to secure action and at the same time to forestall overaction which necessarily results from undue concentration of powers, and thereby obtain efficiency and prevent deposition. Accordingly, with the growing complexity of modern life, the multiplication of the subjects of governmental regulation and the increased difficulty of administering the laws, there is a constantly growing tendency toward the delegation of greater powers by the legislature, and toward the approval of the practice by the court. B. Yes. Statutes for the regulation of public utilities are a proper exercise by the state of its police power. As soon as the power is exercised, all phases of operation of established utilities become at once subject to the police power thus called into operation. The statute is applicable not only to those public utilities coming into existence after its passage, but likewise to those already established and in operation. The state has the ultimate right to regulate public utilities which is founded upon the exercise of police power for the protection of the public as well as of the utilities themselves. Such statutes are, therefore, not unconstitutional, either impairing the obligation of contracts, taking property without due process, or denying the equal protection of the laws, especially inasmuch as the question whether or not private property shall be devoted to a public and the consequent burdens assumed is ordinarily for the owner to decide; and if he voluntarily places his property in public service he cannot complain that it becomes subject to the regulatory powers of the state.

(the case was remanded to PSC for further hearing concerning the period of the certificate to let the petitioner present evidence on its behalf) Section 15 of Commonwealth Act No. 146, as amended by section 1 of Commonwealth Act No. 454, invoked by the respondent Public Service Commission in the decision complained of in the present proceedings, reads as follows: With the exception to those enumerated in the preceding section, no public service shall operate in the Philippines without possessing a valid and subsisting certificate from the Public Service Commission, known as "certificate of public convenience," or "certificate of convenience and

public necessity," as the case may be, to the effect that the operation of said service and the authorization to do business will promote the public interests in a proper and suitable manner. The Commission may prescribed as a condition for the issuance of the certificate provided in the preceding paragraph that the service can be acquired by the Commonwealth of the Philippines or by any instrumentality thereof upon payment of the cost price of its useful equipment, less reasonable depreciation; and likewise, that the certificate shall valid only for a definite period of time; and that the violation of any of these conditions shall produce the immediate cancellation of the certificate without the necessity of any express action on the part of the Commission. In estimating the depreciation, the effect of the use of the equipment, its actual condition, the age of the model, or other circumstances affecting its value in the market shall be taken into consideration. The foregoing is likewise applicable to any extension or amendment of certificates actually force and to those which may hereafter be issued, to permits to modify itineraries and time schedules of public services and to authorization to renew and increase equipment and properties.

[ G.R. NO. 148083, July 21, 2006 ] COMMISSIONER OF INTERNAL REVENUE, PETITIONER, VS. BICOLANDIA DRUG CORPORATION (FORMERLY KNOWN AS ELMAS DRUG CO.), RESPONDENT. In cases of conflict between the law and the rules and regulations implementing the law, the law shall always prevail. Should Revenue Regulations deviate from the law they seek to implement, they will be struck down. Facts: In 1992, Republic Act No. 7432, granted senior citizens several privileges, one of which was obtaining a 20 percent discount from all establishments relative to the use of transportation services, hotels and similar lodging establishments, restaurants and recreation centers and purchase of medicines anywhere in the country. The law also provided that the private establishments giving the discount to senior citizens may claim the cost as tax credit. In compliance with the law, the Bureau of Internal Revenue issued Revenue Regulations No. 2-94, which defined "tax credit". In 1995, respondent Bicolandia Drug Corporation, granted the 20 percent sales discount to qualified senior citizens purchasing their medicines. Respondent treated this discount as a deduction from its gross income in compliance with Revenue Regulations No. 2-94, which implemented R.A. No. 7432. On April 15, 1996, respondent filed its 1995 Corporate Annual Income Tax Return declaring a net loss position with nil income tax liability. On December 27, 1996, respondent filed a claim for tax refund or credit in the amount of PhP 259,659.00 with the Appellate Division of the Bureau of Internal Revenue. It alleged that the petitioner Commissioner of Internal Revenue erred in treating the 20 percent sales discount given to senior citizens as a deduction from its gross income for income tax purposes or other percentage tax purposes rather than as a tax credit. The Court of Tax Appeals ruled that "Respondent is hereby ORDERED to REFUND in favor of Petitioner the amount of P236,321.52, representing overpaid income tax for the year 1995." On appeal, the Court of Appeals modified the decision of the Court of Tax Appeals as the law provided for a tax credit, not a tax refund. The award of tax refund is ANNULLED and SET ASIDE. Instead, the petitioner is hereby ORDERED to issue a tax credit certificate in favor of the respondent in the amount of P 236,321.52. Issues: 1. WON the 20 percent sales discount granted to qualified senior citizens by the respondent pursuant to R.A. No. 7432 may be claimed as a tax credit, instead of a deduction from gross income or gross sales. 2. WON Revenue Regulations No. 2-94 prevails over R.A. No. 7432. 3. WON Revenue Regulations No. 2-94 is valid. Ruling: 1. NO. Under Revenue Regulations No. 2-94, the tax credit is "the amount representing the 20 percent discount granted to a qualified senior citizen by all establishments relative to their utilization of transportation services, hotels and similar lodging establishments, restaurants, drugstores, recreation centers, theaters, cinema houses, concert halls, circuses, carnivals and

other similar places of culture, leisure and amusement, which discount shall be deducted by the said establishments from their gross income for income tax purposes and from their gross sales for value-added tax or other percentage tax purposes." It equated "tax credit" with "tax deduction," contrary to the definition in Black's Law Dictionary, which defined tax credit as: An amount subtracted from an individual's or entity's tax liability to arrive at the total tax liability. A tax credit reduces the taxpayer's liability x x x, compared to a deduction which reduces taxable income upon which the tax liability is calculated. A credit differs from deduction to the extent that the former is subtracted from the tax while the latter is subtracted from income before the tax is computed. The Court of Appeals expressly recognized the differences between a "tax credit" and a "tax refund," and stated that the same are not synonymous with each other, which is why it modified the ruling of the Court of Tax Appeals. 2. NO. Revenue Regulations No. 2-94 is still subordinate to R.A. No. 7432, and in cases of conflict, the implementing rule will not prevail over the law it seeks to implement. While seemingly conflicting laws must be harmonized as far as practicable, in this particular case, the conflict cannot be resolved in the manner the petitioner wishes. There is a great divide separating the idea of "tax credit" and "tax deduction," as seen in the definition in Black's Law Dictionary. It is clear that the lawmakers intended the grant of a tax credit to complying private establishments like the respondent. 3. NO. Revenue Regulations No. 2-94 is null and void for failing to conform to the law it sought to implement. In case of discrepancy between the basic law and a rule or regulation issued to implement said law, the basic law prevails because said rule or regulation cannot go beyond the terms and provisions of the basic law. Revenue Regulations No. 2-94 being null and void, it must be ruled then that under R.A. No. 7432, which was effective at the time, respondent is entitled to its claim of a tax credit, and the ruling of the Court of Appeals must be affirmed. But even as this particular case is decided in this manner, it must be noted that the concerns of the petitioner regarding tax credits granted to private establishments giving discounts to senior citizens have been addressed. R.A. No. 7432 has been amended by Republic Act No. 9257, the "Expanded Senior Citizens Act of 2003." In this, the term "tax credit" is no longer used. This time around, there is no conflict between the law and the implementing Revenue Regulations. Under Revenue Regulations No. 4-2006, "(o)nly the actual amount of the discount granted or a sales discount not exceeding 20% of the gross selling price can be deducted from the gross income, net of value added tax, if applicable, for income tax purposes, and from gross sales or gross receipts of the business enterprise concerned, for VAT or other percentage tax purposes." Under the new law, there is no tax credit to speak of, only deductions. It is well-settled that a regulation should not conflict with the law it implements. Thus, those drafting the regulations should study well the laws their rules will implement, even to the extent of reviewing the minutes of the deliberations of Congress about its intent when it drafted the law. They may also consult the Secretary of Justice or the Solicitor General for their opinions on the drafted rules. It is then the duty of the agencies to ensure that their rules do not deviate from or amend acts of Congress, for their regulations are always subordinate to law.

DEPARTMENT OF AGRARIAN REFORM, represented by SECRETARY JOSE MARI B. PONCE (OIC), petitioner, VS DELIA T. SUTTON, ELLA T. SUTTONSOLIMAN and HARRY T. SUTTON, respondents GR. NO. 162070 [OCTOBER 19, 2005] PUNO, J.: This is a petition for review filed by the Department of Agrarian Reform (DAR) of the Decision and Resolution of the Court of Appeals, dated September 19, 2003 and February 4, 2004, respectively, which declared DAR Administrative Order (A.O.) No. 9, series of 1993, null and void for being violative of the Constitution. FACTS: Respondents made a voluntary offer to sell their landholdings to petitioner DAR to avail of certain incentives under the law. Respondents land has been devoted exclusively to cow and calf breeding. On June 10, 1988, a new agrarian law, RA No. 6657 took effect including in its coverage farms used for raising livestock, poultry and swine. However, in the case of Luz Farms vs. Sec. of DAR, the SC ruled that lands devoted to livestock and poultry-raising are not included in the definition of agricultural land. Hence, declared as unconstitutional certain provisions of the CARL. Respondents then notified the DAR of their withdrawal of the voluntary offer to sell since their land is not covered by the agrarian reform law. However, DAR issued AO No. 9, series of 1993, which provided that only portions of private agricultural lands used for raising livestock, poultry and swine shall be excluded from the coverage of the CARL. As a result, only a portion of the respondents land was excluded from the coverage. ISSUE: Whether or not AO No. 9 issued by the DAR is valid RULING: No. the fundamental rule in administrative law is that, to be valid, administrative rules and regulations must be issued by authority of a law and must not contravene the provisions of the Constitution. Clearly, petitioner DAR has no power to regulate livestock farms which have been exempted by the Constitution from the coverage of agrarian reform. The argument that it was issued in response to unscrupulous landowners converting their agricultural lands to livestock farms will not even warrant such issuance. Respondents family have long been in the business of breeding cattle which petitioner does not dispute.

G.R. No. 132601. October 12, 1998 Leo Echegaray Y. Pilo, petitioner, vs. The Secretary of Justice and the Director of the Bureau of Corrections, The Executive Judge of the Regional Trial Court of quezon city and the presiding judge of Regional Trial court of quezon city, branch 104, respondents. FACTS: On June 25, 1996, this Court affirmed the conviction of petitioner Leo Echegaray y Pilo for the crime of rape of the 10 year-old daughter of his common-law spouse and the imposition upon him of the death penalty for the said crime. Petitioner filed a Motion for Reconsideration with a supplemental motion for reconsideration, raising for the first time the issue of the constitutionality of Republic Act No. 7659 (the death penalty law) and the imposition of the death penalty for the crime of rape; but the court denied such motion. In the meantime, Congress had seen it fit to change the mode of execution of the death penalty from electrocution to lethal injection, and passed Republic Act No. 8177, AN ACT DESIGNATING DEATH BY LETHAL INJECTION AS THE METHOD OF CARRYING OUT CAPITAL PUNISHMENT, AMENDING FOR THE PURPOSE ARTICLE 81 OF THE REVISED PENAL CODE, AS AMENDED BY SECTION 24 OF REPUBLIC ACT NO. 7659. Pursuant to the provisions of said law, the Secretary of Justice promulgated the Rules and Regulations to Implement Republic Act No. 8177 and directed the Director of the Bureau of Corrections to prepare the Lethal Injection Manual. Petitioner filed a Petition for Prohibition, Injunction and/or Temporary Restraining Order to enjoin respondents Secretary of Justice and Director of the Bureau of Prisons from carrying out the execution by lethal injection of petitioner as these are unconstitutional and void. On March 3, 1998, petitioner, through counsel, filed a Motion for Leave of Court to Amend and Supplement Petition with the Amended and Supplemental Petition attached thereto. The Court resolved to require the respondents to COMMENT thereon within a nonextendible period of ten (10) days from notice, and directed the parties "to MAINTAIN the status quo prevailing at the time of the filing of this petition." Petitioner then filed a Very Urgent Motion (1) To clarify Status Quo Order, and (2) For the Issuance of a Temporary Restraining Order. On March 16, 1998, the Office of the Solicitor General filed a Comment (On the Petition and the Amended Supplemental Petition). The Court required the petitioner to file a REPLY thereto within a non-extendible period of ten days from notice.Subsequently, the Commission on Human Rights filed a Motion for Leave of Court to Intervene and/or Appear as Amicus Curiae alleging that the death penalty imposed under R.A. No. 7659 which is to be implemented by R.A. No. 8177 is cruel, degrading and outside the limits of civil society standards, and further invoking (a) Article II, Section 11 of the Constitution. After deliberating on the pleadings, the Court gave due course to the petition, which it now resolves on the merits. In the Amended and Supplemental Petition, petitioner assails the constitutionality of the mode of carrying out his death sentence by lethal INJECTION. ISSUE: Whether or not there is an undue delegation of legislative power to the secretary of justice and the director of bureau of corrections, in RA8177; and thus, makes the regulation invalid.

HELD: Empowering the Secretary of Justice in conjunction with the Secretary of Health and the Director of the Bureau of Corrections, to promulgate rules and regulations on the subject of lethal injection is a form of delegation of legislative authority to administrative bodies. The reason for delegation of authority to administrative agencies is the increasing complexity of the task of government requiring expertise as well as the growing inability of the legislature to cope directly with the myriad problems demanding its attention. Although Congress may delegate to another branch of the Government the power to fill in the details in the execution, enforcement or administration of a law, it is essential, to forestall a violation of the principle of separation of powers, that said law: (a) be complete in itself - it must set forth therein the policy to be executed, carried out or implemented by the delegate - and (b) fix a standard - the limits of which are sufficiently determinate or determinable - to which the delegate must conform in the performance of his functions. Considering the scope and the definiteness of R.A. No. 8177, the Court finds that the law sufficiently describes what job must be done, who is to do it, and what is the scope of his authority. R.A. No. 8177 specifically requires that the death sentence shall be executed under the authority of the Director of the Bureau of Corrections, endeavoring so far as possible to mitigate the sufferings of the person under the sentence during the lethal injection as well as during the proceedings prior to the execution." Further, the Director of the Bureau of Corrections shall take steps to ensure that the lethal injection to be administered is sufficient to cause the instantaneous death of the convict." The legislature also mandated that "all personnel involved in the administration of lethal injection shall be trained prior to the performance of such task." In this sense, R.A. No. 8177 is sufficiently definite and the exercise of discretion by the administrative officials concerned is, to use the words of Justice Benjamin Cardozo, canalized within banks that keep it from overflowing. THUS, there is no undue delegation of legislative power. However, the Court finds in the first paragraph of Section 19 of the IRR a veritable vacuum. The Secretary of Justice has practically abdicated the power to promulgate the manual on the execution procedure to the Director of the Bureau of Corrections, by not providing for a mode of review and approval thereof. Being a mere constituent unit of the Department of Justice, the Bureau of Corrections could not promulgate a manual that would not bear the imprimatur of the administrative superior, the Secretary of Justice as the rulemaking authority under R.A. No. 8177. Such apparent abdication of departmental responsibility renders the regulation invalid.

G.R. No. 108358 January 20, 1995 COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. THE HON. COURT OF APPEALS, R.O.H. AUTO PRODUCTS PHILIPPINES, INC. and THE HON. COURT OF TAX APPEALS, respondents. FACTS: On 22 August 1986, during the period when the President of the Republic still wielded legislative powers, Executive Order No. 41 was promulgated declaring a one-time tax amnesty on unpaid income taxes, later amended to include estate and donor's taxes and taxes on business, for the taxable years 1981 to 1985. Availing itself of the amnesty, respondent R.O.H. Auto Products Philippines, Inc., filed, in October 1986 and November 1986, its Tax Amnesty Return No. 34-F-00146-41 and Supplemental Tax Amnesty Return No. 34-F-00146-64-B, respectively, and paid the corresponding amnesty taxes due. Prior to this availment, petitioner Commissioner of Internal Revenue, in a communication received by private respondent on 13 August 1986, assessed the latter deficiency income and business taxes for its fiscal years ended 30 September 1981 and 30 September 1982 in an aggregate amount of P1,410,157.71. The taxpayer wrote back to state that since it had been able to avail itself of the tax amnesty, the deficiency tax notice should forthwith be cancelled and withdrawn. The request was denied by the Commissioner, in his letter of 22 November 1988, on the ground that Revenue Memorandum Order No. 4-87, dated 09 February 1987, implementing Executive Order No. 41, had construed the amnesty coverage to include only assessments issued by the Bureau of Internal Revenue after the promulgation of the executive order on 22 August 1986 and not to assessments theretofore made. Private respondent appealed the Commissioner's denial to the Court of Tax Appeals. Ruling for the taxpayer, the tax court said: Respondent (herein petitioner Commissioner) failed to present any case or law which proves that an assessment can withstand or negate the force and effects of a tax amnesty. This burden of proof on the petitioner (herein respondent taxpayer) was created by the clear and express terms of the executive order's intention qualified availers of the amnesty may pay an amnesty tax in lieu of said unpaid taxes which are forgiven (Section 2, Section 5, Executive Order No. 41, as amended). On appeal by the Commissioner to the Court of Appeals, the decision of the tax court was affirmed.

ISSUE: The real and only issue is whether or not the position taken by the Commissioner coincides with the meaning and intent of executive Order No. 41. or (WHETHER OR NOT REVENUE MEMORANDUM ORDER NO. 4-87, PROMULGATED TO IMPLEMENT E.O. NO. 41, IS VALID) RULING: NO. The authority of the Minister of Finance (now the Secretary of Finance), in conjunction with the Commissioner of Internal Revenue, to promulgate all needful rules and regulations for the effective enforcement of internal revenue laws cannot be controverted. Neither can it be disputed that such rules and regulations, as well as administrative opinions and rulings, ordinarily should deserve weight and respect by the courts. Much more fundamental than either of the above, however, is that all such issuances must not override, but must remain consistent and in harmony with, the law they seek to apply and implement. Administrative rules and regulations are intended to carry out, neither to supplant nor to modify, the law. If, as the Commissioner argues, Executive Order No. 41 had not been intended to include 19811985 tax liabilities already assessed (administratively) prior to 22 August 1986, the law could have simply so provided in its exclusionary clauses. It did not. The conclusion is unavoidable, and it is that the executive order has been designed to be in the nature of a general grant of tax amnesty subject only to the cases specifically excepted by it.

KILUSANG MAYO UNO(KMU) vs THE DIRECTOR-GENERAL, NEDA GR no. 167798 April 19, 2006 CARPIO, J.: FACTS: In April 13, 2005, President Gloria Macapagal Arroyo issued Executive Order 420 requiring all government agencies and government-owned corporations to streamline and harmonize their Identification Systems. The purposes of the uniform ID data collection and ID format are to reduce costs, achieve efficiency and reliability and ensure compatibility and provide convenience to the people served by government entities. Petitioners allege that EO420 is unconstitutional because it constitutes usurpation of legislative functions by the executive branch of the government. Furthermore, they allege that EO420 infringes on the citizens rights to privacy. ISSUE: In issuing EO 420, did the president make, alter or repeal any laws? RULING: Legislative power is the authority to make laws and to alter or repeal them. In issuing EO 420, the President did not make, alter or repeal any law but merely implemented and executed existing laws. EO 420 reduces costs, as well as insures efficiency, reliability, compatibility and user-friendliness in the implementation of current ID systems of government entities under existing laws. Thus, EO 420 is simply an executive issuance and not an act of legislation.

NORMA PATALINGHUG, et al v. COMMISSION ON ELECTIONS G.R. No. 178767 January 30, 2008 FACTS: Petitioners ran for local positions during the May 2007 elections. At the start of and during the canvassing, petitioners questioned the composition of the Board of Canvassers, and objected to the inclusion of several election returns. The Board of Canvassers ruled against them. Petitioners then filed their notices of appeal, and consequently, initiated with the COMELEC a Pre-Proclamation Petition seeking the declaration of the composition and the proceedings of the Board of Canvassers as illegal. Petitioners also filed an Appeal with the COMELEC, praying for the non-inclusion in the canvass of 182 election returns. COMELEC First Division issued the Order directing the BOC to proclaim the winning candidates in the official canvass; and the BOC proclaimed private respondents as duly elected officials of Lapu-Lapu City. Dissatisfied, petitioners moved for the recall and/or nullification of the said proclamation. On June 4, 2007, the COMELEC First Division rendered the Resolution dismissing the said case. Consequently, the COMELEC en banc issued the third assailed Resolution or the Omnibus Resolution on Pending Cases. Discontented with the said COMELEC issuances, petitioners instituted the instant petition for certiorari under Rule 65. Respondents in their Comment countered, among others that COMELEC Resolution could not be questioned via a petition for certiorari because it was not issued in the COMELECs exercise of quasi-judicial functions. It was rather issued in the exercise of its power to enforce and administer all laws relative to the conduct of elections as enunciated in Section 52 of the OEC. Furthermore, the petition was filed beyond the 30-day reglementary period for questioning via certiorari final orders and resolutions of the COMELEC.

ISSUE: Was the COMELEC Resolution in question properly issued through its adjudicatory or quasi-judicial power? HELD: Yes. C O M E L E C R e s o l u t i o n i s a n i s s u a n c e i n t h e e x e r c i s e o f t h e C O M E L E C s a d j u d i c a t o r y o r q u a s i - j u d i c i a l f u n c t i o n . L i k e w i s e , there was no showing that COMELEC committed grave abuse of discretion in its issuance of the said Resolution. The same was issued pursuant to the second paragraph of Section 16 of R.A. No. 7166, which states that all pre-proclamation cases pending before the Commission shall be deemed terminated a t t h e b e g i n n i n g o f t h e t e r m o f t h e o f f i c e i n v o l v e d a n d t h e r u l i n g s o f t h e b o a r d s o f canvassers concerned shall be deemed affirmed, without prejudice to the filing of a regular election protest by the aggrieved party. However, proceedings may continue when on the basis of the evidence thus far presented, the Commission determines that the petition appears meritorious and accordingly issues an order for the proceeding to continue or when an appropriate order has been issued by the Supreme Court in a petition for certiorari. The determination by the COMELEC of the merits of a pre-proclamation case definitely involves the exercise of adjudicatory powers. The COMELEC examines and weighs the parties pieces of evidence vis--vis their respective arguments, and considers whether, on the basis of the evidence thus far presented, the case appears to have merit. Where a power rests in judgment or discretion, so that it is of judicial nature or character, but does not involve the

exercise of functions of a judge, or is conferred upon an officer other than a judicial officer, it is deemed quasi-judicial. In the case at bar, the Supreme Court laid down some important rules or guidelines to follow on the appropriate recourse to assail any COMELEC Resolutions. First, if a pre-proclamation case is excluded from the list of that shall continue after the beginning of the term of the office involved, the remedy of the aggrieved party is to timely file a certiorari petition assailing the Omnibus Resolution before the Court under Rules 64 and 65, regardless of whether a COMELEC division is yet to issue a definitive ruling in the main case or the COMELEC en banc is yet to act on a motion for reconsideration filed if there is any. It follows that if the resolution on the motion for reconsideration by the en banc precedes the exclusion of the said case from the list, what should be brought before the Court on certiorari is the decision resolving the motion. Second, if a pre-proclamation case is dismissed by a COMELEC division and, on the same date of dismissal or within the period to file a motion for reconsideration, the COMELEC en banc excluded the said case from the list annexed to the Omnibus Resolution, the remedy of the aggrieved party is also to timely file a certiorari petition assailing the Omnibus Resolution before the Court under Rules 64 and 65. The aggrieved party need no longer file a motion for reconsideration of the division ruling. The rationale for this is that the exclusion by the COMELEC en banc of a pre-proclamation case from the list of those that shall continue is already deemed a final dismissal of that case not only by the division but also by the COMELEC en banc. As already explained earlier, the aggrieved party can no longer expect any favorable ruling from the COMELEC. And third, if a pre-proclamation case is dismissed by a COMELEC division but, on the same date of dismissal or within the period to file a motion for reconsideration, the COMELEC en banc included the case in the list annexed to the Omnibus Resolution, the remedy of the aggrieved party is to timely file a motion for reconsideration with the COMELEC en banc. The reason for this is that the challenge to the ruling of the COMELEC division will have to be resolved definitively by the entire body.

SECRETARY OF JUSTICE, petitioner, vs. HON. RALPH C. LANTION, Presiding Judge, Regional Trial Court of Manila, Branch 25, and MARK B. JIMENEZ, respondents. G.R. No. 139465. January 18, 2000 EN BANC, MELO, J. Facts: On January 13, 1977, then President Ferdinand E. Marcos issued Presidential Decree No. 1069 "Prescribing the Procedure for the Extradition of Persons Who Have Committed Crimes in a Foreign Country". Thereafter on November 13, 1994, then Secretary of Justice Franklin M. Drilon, representing the Government of the Republic of the Philippines, signed in Manila the "Extradition Treaty Between the Government of the Republic of the Philippines and the Government of the United States of America" (hereinafter referred to as the RP-US Extradition Treaty). The Senate, by way of Resolution No. 11, expressed its concurrence in the ratification of said treaty. On June 18, 1999, the Department of Justice received from the Department of Foreign Affairs U.S. Note Verbale No. 0522 containing a request for the extradition of private respondent Mark Jimenez to the United States. Attached to the Note Verbale were the Grand Jury Indictment, the warrant of arrest issued by the U.S. District Court, Southern District of Florida, and other supporting documents for said extradition. The private respondent appears to be charged in the United States with violation of the following provisions of the United States Code (USC): A) 18 USC 371 (Conspiracy to commit offense or to defraud the United States; two [2] counts; Maximum Penalty 5 years on each count); B) 26 USC 7201 (Attempt to evade or defeat tax; four [4] counts; Maximum Penalty 5 years on each count); C) 18 USC 1343 (Fraud by wire, radio, or television; two [2] counts; Maximum Penalty 5 years on each count); D) 18 USC 1001 (False statement or entries; six [6] counts; Maximum Penalty 5 years on each count); E) 2 USC 441f (Election contributions in name of another; thirty-three [33] counts; Maximum Penalty less than one year). On the same day, petitioner issued Department Order No. 249 designating and authorizing a panel of attorneys to take charge of and to handle the case pursuant to Section 5(1) of Presidential Decree No. 1069. Accordingly, the panel began with the "technical evaluation and assessment" of the extradition request and the documents in support thereof. However, pending evaluation of the stated extradition documents, private respondent, through counsel, wrote a letter dated July 1, 1999 addressed to petitioner requesting copies of the official extradition request from the U.S. Government, as well as all documents and papers submitted therewith; and that he be given ample time to comment on the request after he shall have received copies of the requested papers. Private respondent also requested that the proceedings on the matter be held in abeyance in the meantime. In response to private respondent's July 1, 1999 letter, petitioner, in a reply-letter dated July 13, 1999, denied the foregoing requests for the following reasons: 1. We find it premature to furnish you with copies of the extradition request and supporting documents from the United States Government, pending evaluation by this Department of the sufficiency of the extradition documents submitted in accordance with the provisions of the extradition treaty and our extradition law. Article 7 of the Extradition Treaty between the Philippines and the United States enumerates the documentary

requirements and establishes the procedures under which the documents submitted shall be received and admitted as evidence. Evaluation by this Department of the aforementioned documents is not a preliminary investigation nor akin to preliminary investigation of criminal cases. 2. The formal request for extradition of the United States contains grand jury information and documents obtained through grand jury process covered by strict secrecy rules under United States law. This Department's denial of your request is consistent with Article 7 of the RP-US Extradition Treaty which provides that the Philippine Government must represent the interests of the United States in any proceedings arising out of a request for extradition. 3. This Department is not in a position to hold in abeyance proceedings in connection with an extradition request. Article 26 of the Vienna Convention on the Law of Treaties, to which we are a party provides that "[E]very treaty in force is binding upon the parties to it and must be performed by them in good faith". Thus on August 6, 1999, private respondent filed with the Regional Trial Court of the National Capital Judicial Region a petition against the Secretary of Justice, the Secretary of Foreign Affairs, and the Director of the National Bureau of Investigation, for mandamus (to compel herein petitioner to furnish private respondent the extradition documents, to give him access thereto, and to afford him an opportunity to comment on, or oppose, the extradition request, and thereafter to evaluate the request impartially, fairly and objectively); certiorari (to set aside herein petitioner's letter dated July 13, 1999); and prohibition (to restrain petitioner from considering the extradition request and from filing an extradition petition in court; and to enjoin the Secretary of Foreign Affairs and the Director of the NBI from performing any act directed to the extradition of private respondent to the United States), with an application for the issuance of a temporary restraining order and a writ of preliminary injunction (pp. 104-105, Rollo). Then on August 10, 1999, respondent judge issued an order that the Secretary of Justice, the Secretary of Foreign Affairs and the Director of the National Bureau of Investigation, their agents and/or representatives is to maintain the status quo by refraining from committing the acts complained of or from conducting further proceedings. He also ordered the issuance of a preliminary injunction. Thereby petitioner initiated the instant proceedings; and on August 17, 1999, Honorable HILARIO G. DAVIDE, JR., Chief Justice, Supreme Court of the Philippines, ordered the Respondent Judge Ralph C. Lantion, his agents, representatives or any person or persons acting in his place or stead to CEASE and DESIST from enforcing the assailed order issued by public respondent. Issue: Was the act of the Secretary of Justice within the purview and scope of his administrative power? Ruling: No. First. As found in Sec. 5 of the Presidential Decree, it sets forth the duty of the Secretary of Foreign Affairs: (1) Unless it appears to the Secretary of Foreign Affairs that the request fails to meet the requirements of this law and the relevant treaty or convention, he shall forward the request together with the related documents to the Secretary of Justice, who shall immediately designate and authorize an attorney in his office to take charge of the case.

It would appear that there was failure to abide by the provisions of Presidential Decree No. 1069. For while it is true that the extradition request was delivered to the Department of Foreign Affairs on June 17, 1999, the following day or less than 24 hours later, the Department of Justice received the request. The record cannot support the presumption of regularity that the Department of Foreign Affairs thoroughly reviewed the extradition request and supporting documents and that it arrived at a well-founded judgment that the request and its annexed documents satisfy the requirements of law. The Secretary of Justice, eminent as he is in the field of law, could not privately review the papers all by himself. Second. In administrative law, a quasi-judicial proceeding involves: (a) taking and evaluation of evidence; (b) determining facts based upon the evidence presented; and (c) rendering an order or decision supported by the facts proved. Inquisitorial power, which is also known as examining or investigatory power, is one or the determinative powers of an administrative body which better enables it to exercise its quasi-judicial authority. This power allows the administrative body to inspect the records and premises, and investigate the activities, of persons or entities coming under its jurisdiction, or to require disclosure of information by means or accounts, records, reports, testimony of witnesses, production of documents, or otherwise. Also in In Ruperto v. Torres (100 Phil. 1098 [1957]), the Court laid down the test of determining whether an administrative body is exercising judicial functions or merely investigatory functions: Adjudication signifies the exercise of power and authority to adjudicate upon the rights and obligations of the parties before it. Hence, if the only purpose for investigation is to evaluate evidence submitted before it based on the facts and circumstances presented to it, and if the agency is not authorized to make a final pronouncement affecting the parties, then there is an absence of judicial discretion and judgment. Thus the administrative body in this case has no power to adjudicate in regard to the rights and obligations of both the Requesting State and the prospective extraditee. Its only power is to determine whether the papers comply with the requirements of the law and the treaty and, therefore, sufficient to be the basis of an extradition petition. Such finding is thus merely initial and not final. The body has no power to determine whether or not the extradition should be effected. That is the role of the court. The body's power is limited to an initial finding of whether or not the extradition petition can be filed in court. Third, although Paragraph [1], Section 9 thereof provides that in the hearing of the extradition petition, the provisions of the Rules of Court, insofar as practicable and not inconsistent with the summary nature of the proceedings, shall apply. Herein the court concludes that the evaluation process is akin to an administrative agency conducting an investigative proceeding, the consequences of which are essentially criminal since such technical assessment sets off or commences the procedure for, and ultimately, the deprivation of liberty of a prospective extraditee. This evaluation process partakes of the nature of a criminal investigation. In a number of cases, it had occasioned to make available to a respondent in an administrative case or investigation certain constitutional rights that are ordinarily available only in criminal prosecutions. The basic right of notice and hearing pervades not only in criminal and civil proceedings but also in administrative proceedings. Non-observance of these rights will invalidate the proceedings. Individuals are entitled to be notified of any pending case affecting their interests, and upon notice, they may claim the right to appear therein and present their side and to refute the position of the opposing parties Fourth. In a situation, however, where the conflict is irreconcilable and a choice has to be made between a rule of international law and municipal law, jurisprudence dictates that municipal law should be upheld by the municipal courts, thus making the twin requirement of notice and hearing in the Constitution applicable in the evaluation process. Thus this instant petition is hereby DISMISSED.

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. (RCPI), petitioner, vs. BOARD OF COMMUNICATIONS and DIEGO MORALES, respondents. G.R. No. L-43653 November 29, 1977 RADIO COMMUNICATIONS OF THE PHILIPPINES. INC. (RCPI), petitioner, vs. BOARD OF COMMUNICATIONS and PACIFICO INNOCENCIO, respondents. G.R. No. L-45378 November 29, 1977, 1st Division, MARTIN, J., FACTS: These two consolidated cases are petitions for review by certiorari of the decisions of the Board of Communications regarding complaints of inconvenience or injuries brought about by the failure of the Radio Communications of the Philippines Inc. (RCPI) to transmit telegrams informing complainants of the deaths of their close relatives which according to them constitute breach of contractual obligation through negligence under the Civil Code. In one case, complainant respondent Diego Morales claims that while he was in Manila his daughter sent him a telegram on October 15, 1974 from Santiago, Isabela, informing him of the death of his wife, Mrs. Diego T. Morales. The telegram sent thru the petitioner RCPI however never reached him. He had to be informed personally about the death of his wife and so to catch up with the burial of his wife, he had to take the trip by airplane to Isabela. In its answer, petitioner RCPI claims that the telegram sent by respondent was transmitted from Santiago, lsabela to its Message Center at Cubao, Quezon City but when it was relayed from Cubao, the radio signal became intermittent making the copy received at Sta. Cruz, Manila unreadable and unintelligible. Because of the failure of the RCPI to transmit said telegram to him, respondent allegedly suffered inconvenience and additional expenses and prays for damages. While in the other case, complainant respondent Pacifico Innocencio claim that on July 13, 1975 Lourdes Innocencio sent a telegram from Paniqui, Tarlac, thru the facilities of the petitioner RCPI to him at Barrio Lomot, Cavinti, Laguna for the purpose of informing him about the death of their father. The telegram was never received by Pacifico Innocencio. Inspite of the non-receipt and/or non-delivery of the message sent to said address, the sender (Lourdes Innocencio) has not been notified about its non-delivery. As a consequence Pacifico Innocencio was not able to attend the internment of their father at Moncada, Tarlac. Because of the failure of RCPI to deliver to him said telegram he allegedly was "shocked when he learned about the death of their father when he visited his hometown Moncada Tarlac on August 14, 1975," and thus suffered mental anguish and personal inconveniences. Likewise, he prays for damages. The public respondent Board in both cases held that the service rendered by petitioner was inadequate and unsatisfactory and imposed upon the petitioner in each case a disciplinary fine of P200 pursuant to Section 21 of Commonwealth Act 146, as amended, by Presidential Decree No. I and Letter of Implementation No. 1. ISSUE: Whether or not the Board of Communications has jurisdiction to entertain and take cognizance of complaints for injury caused by breach of contractual obligation arising from negligence covered by Article 1170 of the Civil Code and injury caused by quasi delict or tort liability under Article 2176 of the Civil Code

RULING: The court ruled in the negative and agreed with the petitioner RCPIs contention that said complaints should be ventilated in the proper courts of justice and not in the Board of Communications. The Board of Communications as a successor in interest of the Public Service Commission "being a creature of the legislature and not a court, can exercise only such jurisdiction and powers as are expressly or by necessary implication, conferred upon it by statute". The functions of the Public Service Commission are limited and administrative in nature and it has only jurisdiction and power as are expressly or by necessary implication conferred upon it by statute. As successor in interest the Board of Communications exercises the same powers jurisdiction and functions as that provided for in the Public Service Act for the Public Service Commission. One of these powers as provided under Section 129 of the Public Service Act governing the organization of the Specialized Regulatory Board is to issue certificate of public convenience. But this power to issue certificate of public convenience does not carry with it the power of supervision and control over matters not related to the issuance of certificate of public convenience or in the performance therewith in a manner suitable to promote public interest. Even assuming that the respondent Board of Communications has the power or jurisdiction over petitioner in the exercise of its supervision to insure adequate public service, petitioner cannot be subjected to payment of fine under Section 21 of the Public Service Act, because this provision of the law subjects to a fine every public service that violates or falls to comply with the terms and conditions of any certificate or any orders, decisions or regulations of the Commission. In the two present cases, petitioner is not being charged nor investigated for violation of the terms and conditions of its certificate of public convenience or of any order, decision or regulations of the respondent Board of Communications. The complaint of respondents was that they were allegedly inconvenienced or injured by the failure of the petitioner to transmit to them telegrams informing them of the deaths of close relatives which according to them constitute breach of contractual obligation through negligence under the Civil Code. The charges however, do not necessarily involve petitioners failure to comply with its certificate of public convenience or any order, decision or regulation of respondent Board of Communication. It is clear from the record that petitioner has not been charge of any violation or failure to comply with the terms and condition of its certificates of public convenience or of any order, decision or regulation of the respondent Board. The charge does not relate to the management of the facilities and system of transmission of messages by petitioner in accordance with its certificate of public convenience. If such was the case as the complainants contended, the proper forum for them to ventilate their grievances for possible recovery of damages against petitioner should be in the courts and not in the respondent Board of Communications. Much less can it impose the disciplinary fine of P200 upon the petitioner. In Francisco Santiago vs. RCPI and Constancio Langan vs. RCPI, the Court ruled that: There can be no justification then for the Public Service Commission (now the Board of Communications as successor in interest) imposing the fines in these two petitions. The law cannot be any clearer. The only power it possessed over radio companies as noted was to fix rates. It could not take to task a radio company for

negligence or misfeasance. It was not vested with such authority. That it did then in these two petitions lacked the impress of validity. In the face of the provision itself, it is rather apparent that the Public Service Commission lacked the required power to proceed against petitioner. There is nothing in Section 21 thereof which empowers it to impose a fine that calls for a different conclusion. Hence, both decisions of respondent Board of Communications were reversed, set aside, declared null and void for lack of jurisdiction to take cognizance of both cases.

SOLID HOMES v. PAYAWAL Solid Homes, Inc., Petitioner, vs. Teresita Payawal and Court of Appeals, Respondents. G.R. No. 84811 August 29, 1989 First Division

Cruz, J.: This is a petition assailing the decision of the Court of Appeals sustaining the jurisdiction of the Regional Trial Court over a complaint, filed by the private respondent against the petitioner, for delivery of title to a subdivision lot. The petition alleged that the trial courts decision is null and void for lack of jurisdiction as the case comes under the jurisdiction of the Housing and Land Use Regulatory Board. FACTS: Petitioner Solid Homes, Inc. contracted to sell to respondent Teresita Payawal a subdivision lot located in Marikina with a purchase price of 28,080.00 pesos. Upon payment of the purchase price in monthly installments and the interests with an aggregate of 38,949.87 pesos, petitioner executed a deed of sale over the land. Petitioner collected the further amount of 1,238.47 pesos from the respondent purportedly for realty taxes and registration expenses. However, petitioner failed to deliver the corresponding certificate of title despite respondents repeated demands. It turned out that petitioner had mortgaged the property in bad faith to a financing company. Aggrieved, respondent filed a complaint against petitioner before the Regional Trial Court of Quezon City praying for the delivery of the title to the lot or, alternatively, the return of all the amounts paid by her plus interest. She also claimed moral and exemplary damages, attorney's fees and the costs of the suit. Petitioner filed a motion to dismiss the complaint on the ground that the trial court had no jurisdiction. Citing Section 3 of Presidential Decree No. 957, petitioner argued that the National Housing Authority shall have exclusive jurisdiction to regulate the real estate trade and business in accordance with the provisions of the said decree. The motion to dismiss was, however, denied. After trial, judgment was rendered in favor of the respondent and the petitioner was ordered to deliver the title to the land or, failing this, to refund to the winning party the sum of 38,949.87 pesos plus interest from 1975 and until the full amount be paid, including damages. On appeal, the Court of Appeals affirmed the trial courts decision holding that the same has jurisdiction over the case under Section 41 of Presidential Decree No. 957. Hence, this petition. Respondent contends that the applicable provision is Section 19 of Batas Pambansa Blg. 129 and not Presidential Decree No. 1344, which confers on Regional Trial Courts jurisdiction to hear and decide the following cases: (a) all civil actions in which the subject of the litigation is incapable of pecuniary estimation; (b) 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, original jurisdiction over which is conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts; and (c) all other cases in which the demand, exclusive of interest and cost or the value of the property in controversy, amounts to more than twenty thousand pesos. Respondent also argues that the trial court could also assume concurrent jurisdiction because of Section 41 of PD No. 957. Additionally, respondent alleges that Batas Pambansa Blg. 129 should control as the later enactment, having been promulgated in 1981, after Presidential Decree No. 957 was issued in 1975 and Presidential Decree No. 1344 in 1978. ISSUES: 1. Whether or not the Housing and Land Use Regulatory Board, an administrative body, has jurisdiction to try the present case. 2. Whether or not the Housing and Land Use Regulatory Board has the competence to award damages.

3. Whether or not the trial court has concurrent jurisdiction over the case. 4. Whether or not Batas Pambansa Blg. 129 is controlling because it is a later enactment than Presidential Decree Nos. 957 and 1344. RULING: 1. Yes. The Housing and Land Use Regulatory Board has jurisdiction to try the present case. 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. 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; 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. The abovementioned provision clearly states 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, now the Housing and Land Use Regulatory Board. Statutes conferring powers on 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 Presidential Decree No. 957 and Presidential Decree No. 1344, to determine the rights of the parties under a contract to sell a subdivision lot. It is settled that any decision rendered without jurisdiction is a total nullity and may be struck down at any time, even on appeal before the Supreme Court. The only exception is where the party raising the issue is barred by estoppel, which does not appear in the present case.

2. Yes. The Housing and Land Use Regulatory Board has competence to award damages. The general rule is that, administrative agencies have limited powers which are administrative in nature. These agencies are created by law, hence they can only exercise jurisdiction and power as are expressly conferred by law or by necessary implication. In case of injury suffered by an individual because of breach of contractual obligation due to negligence, the proper forum to file the complaint to recover damages is the court and not an administrative agency. However, as an exception, in the case at bar, the Housing and Land Use Regulatory Board has been conferred by Presidential Decree No. 1344, the competence to award damages and attorneys fees which are recoverable either by agreement of the parties or under Article 2208 of the New Civil Code. The competence of the Board to award damages is part of the exclusive power conferred upon it by Presidential Decree 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. The Secretary of Justice was, therefore, correct in opining that claim for damages which the subdivision or 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 other claims" used in Section 1 paragraph c of Presidential Decree No. 1344. The phrase "any other claims" is sufficiently broad to include any and all claims which are incidental to or a necessary consequence of the claims specifically included in the grant of jurisdiction to the Housing and Land Use Regulatory Board. It is also correct that with respect to claims for attorney's fees which are recoverable either by agreement of the parties or pursuant to Article 2208 of the Civil Code, to wit: (a) when exemplary damages are awarded and (b) where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiffs plainly valid, just and demandable claim. A strict construction of the subject provisions of Presidential Decree No. 1344 which would deny the administrative body 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 same body 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.

3.

No. The Supreme Court ruled that the trial court cannot assume jurisdiction on the basis of Section 41 of Presidential Decree No. 957, which provides:

SECTION 41. Other remedies.-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. The above provision does not vest concurrent jurisdiction on the Regional Trial Court and the Housing and Land Use Regulatory Board over the complaint mentioned in Presidential Decree 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.

4. No. It is a well-settled principle that in case of conflict between a general law and a special law, the latter must prevail regardless of the dates of their enactment. 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. In this case, the general law is Batas Pambansa Blg. 129 and the special law is Presidential Decree No. 1344.

Hence, the Court decided to nullify the proceedings in the trial court for lack of jurisdiction. The assailed decision of the respondent court was reversed and the decision of the Regional Trial Court of Quezon City was set aside, without prejudice to the filing of the appropriate complaint before the Housing and Land Use Regulatory Board.

GMA NETWORK, INC. v ABS-CBN BROADCASTING CORPORATION G.R. No. 160703 September 23, 2005

FACTS: Petitioner GMA Network, Inc. filed on May 6, 2003 before the Regional Trial
Court of Quezon City a complaint for damages against respondents ABS-CBN Broadcasting Corporation, Central CATV, Inc. or SkyCable, Philippine Home Cable Holdings, Inc. and Pilipino Cable Corporation or Sun Cable. In its complaint, GMA alleged that respondents engaged in unfair competition when the cable companies arbitrarily re-channeled petitioners cable television broadcast on February 1, 2003, in order to arrest and destroy its upswing performance in the television industry. GMA alleged that the re-channeling of its cable television broadcast resulted in damage to its business operations. GMA argued that respondents were able to perpetrate such unfair business practice through a common ownership and interlocking businesses. SkyCable and Sun Cable are wholly-owned subsidiaries of Sky Vision Corporation which is allegedly controlled by Lopez, Inc. On the other hand, Home Cable is a wholly-owned subsidiary of Unilink Communications Corporation, which is owned by Media quest Holdings, Inc., a company controlled by the Pension Trust Fund of the PLDT Employees. SkyCable and Sun Cable moved for dismissal of the complaint on the grounds of litis pendentia and forum-shopping since there was a similar case pending before the National Telecommunications Commission. The case allegedly involved the same cause of action and the same parties, except for ABS-CBN. SkyCable and Sun Cable also asserted that it is the NTC that has primary jurisdiction over the issues raised in the complaint. Moreover, GMA had no cause of action against the two entities and failed to exhaust administrative remedies. GMA asserts that the resolution of the issues raised in the complaint does not entail highly technical matters requiring the expertise of the NTC. Petitioner insists that the subject matter of the complaint merely involves respondents wrongful acts of unfair competition and/or unfair trade practices resulting to damages, jurisdiction over which lies with the regular courts and not the NTC.

ISSUE: Whether or not National Telecommunications Commission has jurisdiction over the case and not the regular courts.

HELD: Yes. GMAs complaint for damages is based on the alleged arbitrary re channeling of its broadcast over the cable companies television systems, thereby resulting in the distortion and degradation of its video and audio signals. The rechanneling was allegedly made possible through the common ownership and interlocking businesses of respondent corporations and was designed to thwart

petitioners upswing performance in the television ratings game. In other words, the wrongful acts complained of and upon which the damages prayed for are based, have to do with the operations and ownership of the cable companies. These factual matters undoubtedly pertain to the NTC and not the regular courts. Before the trial court can resolve the issue of whether GMA is entitled to an award of damages, it would have to initially ascertain whether there was arbitrary rechanneling which distorted and downgraded GMAs signal. The ascertainment of these facts, which relate to the operations of the cable companies, would require the application of technical standards imposed by the NTC as well as determination of signal quality within the limitations imposed by the technical state of the art. These factual questions would necessarily entail specialized knowledge in the fields of communications technology and engineering which the courts do not possess. It is the NTC which has the expertise and skills to deal with such matters. It is in the best position to judge matters relating to the broadcasting industry as it is presumed to have an unparalleled understanding of its market and commercial conditions. Moreover, it is the NTC that has the information, statistics and data peculiar to the television broadcasting industry. The regulation of ownership of television and cable television companies is likewise within the exclusive concern of the NTC, pursuant to its broader regulatory power of ensuring and promoting a larger and more effective use of communications, radio and television broadcasting facilities in order that the public interest may well be served. The NTC is mandated to maintain effective competition among private entities engaged in the operation of public service communications. It is also the agency tasked to grant certificates of authority to cable television operators, provided that the same does not infringe on the television and broadcast markets. Consequently, while it is true that the regular courts are possessed of general jurisdiction over actions for damages, it would nonetheless be proper for the courts to yield its jurisdiction in favor of an administrative body when the determination of underlying factual issues requires the special competence or knowledge of the latter. In this era of clogged court dockets, administrative boards or commissions with special knowledge, experience and capability to promptly hear and determine disputes on technical matters or intricate questions of facts, subject to judicial review in case of grave abuse of discretion, are well-nigh indispensable. Between the power lodged in an administrative body and a court, therefore, the unmistakable trend is to refer it to the former.

REPUBLIC OF THE PHILIPPINES, represented by NATIONAL TELECOMMUNICATIONS COMMISSION, petitioner, vs. EXPRESS TELECOMMUNICATION CO., INC. and BAYAN TELECOMMUNICATIONS CO., INC., respondents. G.R. No. 147210. January 15, 2002 BAYAN TELECOMMUNICATIONS (Bayantel), INC., petitioner, vs. EXPRESS TELECOMMUNICATION CO., INC. (Extelcom), respondent. G.R. No. 147096. January 15, 2002 FIRST DIVISION, YNARES-SANTIAGO, J. Facts: On December 29, 1992, International Communications Corporation (now Bayan Telecommunications, Inc. or Bayantel) filed an application with the National Telecommunications Commission (NTC) for a Certificate of Public Convenience or Necessity (CPCN) to install, operate and maintain a digital Cellular Mobile Telephone System/Service (CMTS) with prayer for a Provisional Authority (PA). On May 6, 1993, and prior to the issuance of any notice of hearing by the NTC with respect to Bayantel's original application, Bayantel filed an urgent ex-parte motion to admit an amended application. On May 17, 1993, the notice of hearing issued by the NTC with respect to this amended application was published in the Manila Chronicle. Copies of the application as well as the notice of hearing were mailed to all affected parties. Subsequently, hearings were conducted on the amended application. But before Bayantel could complete the presentation of its evidence, the NTC issued an Order dated December 19, 1993: In view of the recent grant of two (2) separate Provisional Authorities in favor of ISLACOM and GMCR, Inc., which resulted in the closing out of all available frequencies for the service being applied for by herein applicant, and in order that this case may not remain pending for an indefinite period of time, AS PRAYED FOR, let this case be, as it is, hereby ordered ARCHIVED without prejudice to its reinstatement if and when the requisite frequency becomes available. On June 18, 1998, the NTC issued Memorandum Circular No. 5-6-98 re-allocating five (5) megahertz (MHz) of the radio frequency spectrum for the expansion of CMTS networks. Likewise, on March 23, 1999, Memorandum Circular No. 3-3-99 was issued by the NTC re-allocating additional five (5) MHz frequencies for CMTS. Thus on May 17, 1999, Bayantel filed an Ex-Parte Motion to Revive Case, citing the availability of new frequency bands for CMTS operators then on February 1, 2000, the NTC granted BayanTel's motion to revive the latter's application and set the case for hearings. The NTC noted that the application was ordered archived without prejudice to its reinstatement if and when the requisite frequency shall become available. Consequently, respondent Express Telecommunication Co., Inc. (Extelcom) filed in NTC an Opposition (With Motion to Dismiss) praying for the dismissal of Bayantel's application. Extelcom argued that Bayantel's motion sought the revival of an archived application filed almost eight (8) years ago. Thus, the documentary evidence and the allegations of respondent Bayantel in this application are all outdated and should no longer be used as basis of the necessity for the proposed CMTS service. Moreover, Extelcom alleged that there was no public need for the service applied for by Bayantel as the present five CMTS operators --- Extelcom, Globe Telecom, Inc., Smart Communication, Inc., Pilipino Telephone Corporation, and Isla Communication Corporation, Inc. --- more than adequately addressed the market demand. It likewise contended that there were no available radio frequencies that could accommodate a new CMTS operator. On May 3, 2000, the NTC issued an Order granting in favor of Bayantel a provisional authority to operate CMTS service to which Extelcom filed with the Court of Appeals a petition for certiorari and prohibition. The CA granted the plea of Extelcom, leading to this petition. Issue:

Did the NTC acted within its power? Ruling: Yes. First, in the regulatory telecommunications industry, the NTC has the sole authority to issue Certificates of Public Convenience and Necessity (CPCN) for the installation, operation, and maintenance of communications facilities and services, radio communications systems, telephone and telegraph systems. Such power includes the authority to determine the areas of operations of applicants for telecommunications services. In granting Bayantel the provisional authority to operate a CMTS, the NTC applied Rule 15, Section 3 of its 1978 Rules of Practice and Procedure stating: Sec. 3. Provisional Relief. --- Upon the filing of an application, complaint or petition or at any stage thereafter, the Board may grant on motion of the pleader or on its own initiative, the relief prayed for, based on the pleading, together with the affidavits and supporting documents attached thereto, without prejudice to a final decision after completion of the hearing which shall be called within thirty (30) days from grant of authority asked for. Second, although Extelcom, contends that the NTC should have applied the Revised Rules which were filed with the Office of the National Administrative Register on February 3, 1993. These Revised Rules deleted the phrase "on its own initiative;" however, the 1993 Revised Rules have not been published in a newspaper of general circulation thus the NTC has been applying the 1978 Rules. The absence of publication, coupled with the certification by the Commissioner of the NTC stating that the NTC was still governed by the 1978 Rules, clearly indicate that the 1993 Revised Rules have not taken effect at the time of the grant of the provisional authority to Bayantel. Even the 1993 Revised Rules itself mandates that said Rules shall take effect only after their publication in a newspaper of general circulation. In the absence of such publication, therefore, it is the 1978 Rules that governs. Third, the archiving of cases is a widely accepted measure designed to shelve cases in which no immediate action is expected but where no grounds exist for their outright dismissal, albeit without prejudice. It saves the petitioner or applicant from the added trouble and expense of re-filing a dismissed case. The said application was ordered archived because of lack of available frequencies at the time, and made subject to reinstatement upon availability of the requisite frequency. This recourse may be justified under Rule 1, Section 2 of the 1978 Rules, Sec. 2. Scope.--- These rules govern pleadings, practice and procedure before the Board of Communications (now NTC) in all matters of hearing, investigation and proceedings within the jurisdiction of the Board. However, in the broader interest of justice and in order to best serve the public interest, the Board may, in any particular matter, except it from these rules and apply such suitable procedure to improve the service in the transaction of the public business. Fourth, Extelcom's right to procedural due process was not prejudiced. In fact, the records show that the NTC has scheduled several hearing dates for this purpose, at which all interested parties shall be allowed to register their opposition. Also with Extelcom having fully participated in the proceedings, and indeed, given the opportunity to file its opposition to the application, there was clearly no denial of its right to due process. The records also show that all of the five (5) CMTS operators in the country were duly notified and were allowed to raise their respective oppositions to Bayantel's application through the NTC's Order. Fifth, the rule is well-entrenched that a party must exhaust all administrative remedies before resorting to the courts. Herein, Extelcom violated the rule on exhaustion of administrative remedies when it went directly to the Court of Appeals on a petition for certiorari and prohibition from the Order of the NTC dated May 3, 2000, without first filing a motion for reconsideration. The general rule is that purely administrative and discretionary functions may not be interfered with by the courts. Court has consistently held that the courts will not interfere in matters which are addressed to the sound discretion of the government agency entrusted with the regulation of activities coming under the special and technical training and knowledge of such agency. Thus in view of the foregoing, the consolidated petitions are GRANTED.

FRANCISCO I. CHAVEZ vs. PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT CORPORATION G.R. No. 133250 July 9, 2002

FACTS: In 1973, the Commissioner on Public Highways entered into a contract to reclaim areas of Manila Bay with the Construction and Development Corporation of the Philippines (CDCP) which also included the construction of Phases I and II of the Manila-Cavite Coastal Road. CDCP obligated itself to carry out all the works in consideration of fifty percent of the total reclaimed land. PEA (Public Estates Authority), respondent herein, was created by President Marcos under P.D. 1084, tasked with developing and leasing reclaimed lands. By virtue of PD No. 1085, he transferred to PEA the lands reclaimed in the foreshore and offshore of the Manila Bay.These lands were transferred to the care of PEA under P.D. 1085 as part of the Manila Cavite Road and Reclamation Project (MCRRP). CDCP and PEA entered into an agreement that all future projects under the MCRRP would be funded and owned by PEA. Then President Aquino issued Special Patent granting and transferring to PEA the parcels of land so reclaimed under MCCRR Project. Subsequently, the Register of Deeds of Paraaque issued Transfer Certificates of Titles in the name of PEA, covering the three reclaimed islands known as the Freedom Islands. Subsequently, PEA entered into a joint venture agreement (JVA) with AMARI, a ThaiPhilippine corporation to develop the Freedom Islands. Along with another 250 hectares, PEA and AMARI entered the JVA which would later transfer said lands to AMARI. This caused a stir especially when Sen. Maceda assailed the agreement, claiming that such lands were part of public domain. Senate President Ernesto Maceda delivered a privilege speech in the Senate and denounced the JVA as the "grandmother of all scams. As a result joint investigation was conducted and found out that JVA is illegal for alienating reclaimed lands which is land of public domain. Pres. Ramos created a task force to investigate the legality of JVA, which tasked force upheld the legality of JVA contrary to conclusions reached by Senate committees. Inquirer and Today published reports that there were on-going renegotiations between PEA and AMARI under an order issued by then President Fidel V. Ramos. Peitioner Frank J. Chavez filed case as a taxpayer praying for mandamus, a writ of preliminary injunction and a TRO against the sale of reclaimed lands by PEA to AMARI and from implementing the JVA. Following these events, under President Estradas admin, PEA and AMARI entered into an Amended JVA. Due to the approval of the Amended JVA petitioner now

prays that on "constitutional and statutory grounds the renegotiated contract be declared null and void. ISSUE: Whether or not the transfer to AMARI lands reclaimed or to be reclaimed as part of the stipulations in the (Amended) JVA between AMARI and PEA violate Sec. 3 Art. XII of the 1987 Constitution HELD: On the issue of Amended JVA as violating the constitution, it was held by the Court that 157.84 hectares of reclaimed lands comprising the Freedom Islands, now covered by certificates of title in the name of PEA, are alienable lands of the public domain. However, the 592.15 hectares of submerged areas of Manila Bay remain inalienable natural resources of the public domain until classified as alienable or disposable lands open to disposition and declared no longer needed for public service. As the central implementing agency tasked to undertake reclamation projects nationwide, with authority to sell reclaimed lands, PEA took the place of DENR as the government agency charged with leasing or selling reclaimed lands of the public domain. The reclaimed lands being leased or sold by PEA are not private lands, in the same manner that DENR, when it disposes of other alienable lands, does not dispose of private lands but alienable lands of the public domain. Only when qualified private parties acquire these lands will the lands become private lands. In the hands of the government agency tasked and authorized to dispose of alienable of disposable lands of the public domain, these lands are still public, not private lands. PEA may lease these lands to private corporations but may not sell or transfer ownership of these lands to private corporations. PEA may only sell these lands to Philippine citizens, subject to the ownership limitations in the 1987 Constitution and existing laws. The government can make such classification and declaration only after PEA has reclaimed these submerged areas. Only then can these lands qualify as agricultural lands of the public domain, which are the only natural resources the government can alienate. In their present state, the 592.15 hectares of submerged areas are inalienable and outside the commerce of man. Since the Amended JVA seeks to transfer to AMARI, a private corporation, ownership of 77.34 hectares110 of the Freedom Islands, such transfer is void for being contrary to Section 3, Article XII of the 1987 Constitution which prohibits private corporations from acquiring any kind of alienable land of the public domain. Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156 hectares111 of still submerged areas of Manila Bay, such transfer is void for being contrary to Section 2, Article XII of the 1987 Constitution which prohibits the alienation of natural resources other than agricultural lands of the public domain. PEA may reclaim these submerged areas. Thereafter, the government can classify the reclaimed lands as alienable or disposable, and further declare them no longer needed for public service. Still, the transfer of such reclaimed alienable lands of the public domain to AMARI will be void in view of Section 3, Article XII of the 1987Constitution which prohibits private corporations from acquiring any kind of alienable land of the public domain.

PANGILINAN, Francis Paolo M. II-B PHILCOMSAT v. Alcuaz (GR 84818) Facts: By virtue of Republic Act No. 5514, PHILCOMSAT was granted "a franchise to establish, construct, maintain and operate in the Philippines, at such places as the grantee may select, station or stations and associated equipment and facilities for international satellite communications." Under this franchise, it was likewise granted the authority to "construct and operate such ground facilities as needed to deliver telecommunications services from the communications satellite system and ground terminal or terminals." By designation of the Republic of the Philippines, the petitioner is also the sole signatory for the Philippines in the Agreement and the Operating Agreement relating to the International Telecommunications Satellite Organization (INTELSAT) of 115 member nations, as well as in the Convention and the Operating Agreement of the International Maritime Satellite Organization (INMARSAT) of 53 member nations, which two global commercial telecommunications satellite corporations were collectively established by various states in line with the principles set forth in Resolution 1721 (XVI) of the General Assembly of the United Nations. Under Section 5 of Republic Act No. 5514, petitioner was exempt from the jurisdiction of the then Public Service Commission, now respondent NTC. However, pursuant to Executive Order No. 196 issued on June 17, 1987, petitioner was placed under the jurisdiction, control and regulation of respondent NTC, including all its facilities and services and the fixing of rates. Implementing said Executive Order No. 196, respondents required petitioner to apply for the requisite certificate of public convenience and necessity covering its facilities and the services it renders, as well as the corresponding authority to charge rates therefor. Consequently, under date of September 9, 1987, petitioner filed with respondent NTC an application for authority to continue operating and maintaining the same facilities it has been continuously operating and maintaining since 1967, to continue providing the international satellite communications services it has likewise been providing since 1967, and to charge the current rates applied for in rendering such services. Pending hearing, it also applied for a provisional authority so that it can continue to operate and maintain the above mentioned facilities, provide the services and charge therefor the aforesaid rates therein applied for. On September 16, 1987, petitioner was granted a provisional authority to continue operating its existing facilities, to render the services it was then offering, and to charge the rates it was then charging. This authority was valid for six (6) months from the date of said order. When said provisional authority expired on March 17, 1988, it was extended for another six (6) months, or up to September 16, 1988. The NTC order now in controversy had further extended the provisional authority of the petitioner for another six (6) months, counted from September 16, 1988, but it directed the petitioner to charge modified reduced rates through a reduction of fifteen percent (15%) on the present authorized rates. Issue: W/N the rate fixing policy of the NTC is of quasi-judicial character.

Ruling: The policy is of quasi- judicial character. The order in question which was issued by respondent Alcuaz no doubt contains all the attributes of a quasi-judicial adjudication. Foremost is the fact that said order pertains exclusively to petitioner and to no other. Further, it is premised on a finding of fact, although patently superficial, that there is merit in a reduction of some of the rates charged- based on an initial evaluation of petitioner's financial statements-without affording petitioner the benefit of an explanation as to what particular aspect or aspects of the financial statements warranted a corresponding rate reduction. No rationalizations was offered nor were the attending contingencies, if any, discussed, which prompted respondents to impose as much as a fifteen percent (15%) rate reduction. It is not far-fetched to assume that petitioner could be in a better position to rationalize its rates vis-a-vis the viability of its business requirements. The rates it charges result from an exhaustive and detailed study it conducts of the multi-faceted intricacies attendant to a public service undertaking of such nature and magnitude. We are, therefore, inclined to lend greater credence to petitioner's ratiocination that an immediate reduction in its rates would adversely affect its operations and the quality of its service to the public considering the maintenance requirements, the projects it still has to undertake and the financial outlay involved. Notably, petitioner was not even afforded the opportunity to cross-examine the inspector who issued the report on which respondent NTC based its questioned order. At any rate, there remains the categorical admission made by respondent NTC that the questioned order was issued pursuant to its quasi-judicial functions. It, however, insists that notice and hearing are not necessary since the assailed order is merely incidental to the entire proceedings and, therefore, temporary in nature. This postulate is bereft of merit. While respondents may fix a temporary rate pending final determination of the application of petitioner, such rate-fixing order, temporary though it may be, is not exempt from the statutory procedural requirements of notice and hearing, as well as the requirement of reasonableness. Assuming that such power is vested in NTC, it may not exercise the same in an arbitrary and confiscatory manner. Categorizing such an order as temporary in nature does not perforce entail the applicability of a different rule of statutory procedure than would otherwise be applied to any other order on the same matter unless otherwise provided by the applicable law.

VIGAN ELECTRIC LIGHT COMPANY, INC., petitioner, vs. THE PUBLIC SERVICE COMMISSION, respondent. FACTS: Republic Act No. 316, approved on June 19, 1948, granted petitioner Vigan Electric Light Company, Inc., a franchise to construct, maintain and operate an electric light heat and/or power plant for the purpose of generating and distributing light, heat and/or power, for sale within the limits of several municipalities of the province of Ilocos Sur. Accordingly, petitioner secured from respondent, on May 31, 1950, a certificate of public convenience to render electric light, heat and/or power services in said municipalities On May 22, 1957, petitioner, acting with respondent's approval, entered into a contract for the purchase of electric power and energy from the National Power Corporation, for resale, in the course of the business of said petitioner, to its customers, to whom, in fact, petitioner resold said electric power and energy, in accordance with the schedule of rates. About five (5) years later, or on January 16, 1962, respondent advised petitioner of a conference to be held on February 12, 1962 for the purpose of revising its authorized rates. Soon thereafter, petitioner received a letter of respondent informing the former of an alleged letter-petition of "Congressman Floro Crisologo and 107 alleged residents of Vigan, Ilocos Sur", charging the following: "We also denounce the sale of TWO THOUSAND (2,000) ELECTRIC METERS in blackmarket by the Vigan Electric Light Company to Avegon Co., as anomalous and illegal. The Vigan Electric Light Company has commercialized these privileges which properly belongs to the people. "We also report that the electric meters in Vigan used by the consumers had been installed in bad faith and they register excessive rates much more than the actual consumption." In reply to said communications, petitioner's counsel wrote to respondent, on February 1, 1962, a letter asking that the conference scheduled for February 12 be postponed to March 12, and another letter stating inter alia: "In connection therewith, please be informed that my client, the Vigan Electric Light Co., Inc., has not had any dealing with the Avegon Co., Inc., relative to the 2,000 electric meters mentioned in the petition. "Furthermore, as counsel for Vigan Electric Light Co. Inc., I wish to inform this Honorable Commission that the charge that said company installed the electric meters in bad faith and that said meters register excessive rates could have no valid basis because all of these meters have been inspected, checked, tested and sealed by your office." On March 15, 1962, petitioner received a communication from the General Auditing Office notifying him that one Mr. Cesar A. Damole had "been instructed to make an audit and examination of the books and other records of account" of said petitioner. Subsequently, respondent issued a subpoena duces tecum requiring petitioner to produce before the former, during a conference scheduled for April 10, 1962, certain books of account and financial statements specified in said process. On the date last mentioned petitioner moved to quash the subpoena duces tecum. The motion was not acted upon in said conference of April 10, 1962. However, it was then decided that the next conference be held on April 30, 1962, which was later postponed to May 21, 1962. When petitioner's representatives appeared before respondent, on the date last mentioned, they were advised by the latter that the scheduled conference had been cancelled, that the petition to quash the subpoena duces tecum had been granted, and that, on May 17, 1962, respondent had issued an order, from which we quote: "We now have the audit report of the General Auditing Office dated May 4, 1962, covering the operation of the Vigan Electric Light Co., Inc. in Vigan, Bantay and Caoayan, Ilocos Sur, for the

period from January 1 to December 31, 1961. We find, the present rates of the Vigan Electric Light Co., Inc. may be reduced by 17.84% or in round figure by 18%. "Upon consideration of the foregoing, and finding that the Vigan Electric Light Co., Inc. is making a net operating profit in excess of the allowable return of 12% on its invested capital, we believe that it is in the public interest and in consonance with Section 3 of Republic Act No. 3043 that reduction of its rates to the extent of its excess revenue be put into effect immediately. Soon later, or on June 25, 1962, petitioner herein instituted the present action for certiorari to annul said order of May 17, 1962, upon the ground that, respondent then expressed the view that there was no necessity of serving copy of said letter to petitioner, because respondent was merely holding informal conferences to ascertain whether petitioner would consent to the reduction of its rates; that petitioner objected to said reduction without a hearing, alleging that its rates could be reduced only if proven by evidence validly adduced to be excessive; that petitioner offered to introduce evidence to show the reasonableness of its aforementioned rates, and even the fairness of its increase; that petitioner was then assured that it would be furnished a copy of the aforementioned letter-petition and that a hearing would be held, if a reduction of its rates could not be agreed upon; that petitioner had not even been served a copy of the auditor's report upon which the order complained of is based, that such order had been issued without notice and hearing; and that, accordingly, petitioner had been denied due process. In support of its first special defense, respondent maintains that rate fixing is a legislative function; that legislative or rule-making powers may constitutionally be exercised without previous notice or hearing.

ISSUE: WON the petitioners were afforded due process. HELD: No. Indeed, Sections 16 (c) and 20 (a) of Commonwealth Act No. 146 explicitly require notice and hearing. The pertinent parts thereof provide: "SEC. 16. The Commission shall have the power, upon proper notice and hearing in accordance with the rules and provisions of this Act, subject to the limitations and exceptions mentioned and saving provisions to the contrary: xxx xxx xxx "(c) To fix and determine individual or joint rates, tolls, charges classifications, or schedules thereof, as well as commutation, mileage, kilometrage, and other special rates which shall be imposed, observed, and followed thereafter by any public service: Provided, That the Commission may, in its discretion, approve rates proposed by public services provisionally and without necessity of any hearing; but it shall call a hearing thereon within thirty days thereafter, upon publication and notice to the concerns operating in the territory affected: Provided, further, that in case the public service equipment of an operator is used principally or secondarily for the promotion of a private business, the net profits of said private business shall be considered in relation with the public service of such operator for the purpose of fixing the rates. "Sec. 20 Acts requiring the approval of the Commission. Subject to established limitations and exceptions and saving provisions to the contrary, it shall be unlawful for any public service or for the owner, lessee or operator thereof, without the approval and authorization of the Commission previously had

"(a) To adopt, establish, fix, impose, maintain, collect or carry into effect any individual or joint rates, commutation, mileage or other special rate, toll, fare, charge, classification or itinerary. The Commission shall approve only those that are just and reasonable and not any that are unjustly discriminatory or unduly preferential, only upon reasonable notice to the public services and other parties concerned, giving them a reasonable opportunity to be heard, . . ." Since compliance with law must be presumed, it should be assumed that petitioner's current rates were fixed by respondent after proper notice and hearing. Hence, a modification of such rates cannot be made, over petitioner's objection, without such notice and hearing, particularly considering that the factual basis of the action taken by respondent is assailed by petitioner. The rule applicable is set forth in the American Jurisprudence in the following language: "Whether notice and a hearing in proceedings before a public service commission are necessary depends chiefly upon statutory or constitutional provisions applicable to such proceedings, which make notice and hearing, prerequisite to action by the commission, and upon the nature and object of such proceedings, that is, whether the proceedings, are on the one hand, legislative and rule-making in character, or are, on the other hand, determinative and judicial or quasi-judicial, affecting the rights and property of private or specific persons. As a general rule, a public utility must be afforded some opportunity to be heard as to the propriety and reasonableness of rates fixed for its services by a public service commission." Wherefore, we hold that the determination of the issue involved in the order complained of partakes of the nature of a quasi-judicial function and that, having been issued without previous notice and hearing, said order is clearly violative of the due process clause, and, hence, null and void, so that a motion for reconsideration thereof is not an absolute prerequisite to the institution of the present action for certiorari. For this reason, and considering that said order was being made effective on June 1, 1962, or almost immediately after its issuance (on May 17, 1962, although petitioner was not notified until May 21, 1962), we find that petitioner was justified in commencing this proceedings without first filing said motion. WHEREFORE, the writ prayed for is granted and the preliminary injunction issued by this Court hereby made permanent. It is so ordered.

ERMELYN A. LIMBONA v. JUDGE CASAN ALI LIMBONA [Case Digest]

A.M. No. SCC-03-08

ERMELYN A. LIMBONA, complainant, vs. JUDGE CASAN ALI LIMBONA, Sharia Circuit Court, Tamparan, Lanao del Sur, respondent. [A.M. No. SCC-03-08. June 16, 2003] Facts:
Complainant alleged that she is married to the respondent judge. She said she first met him sometime in 1992 and they had an affair. At that time, respondent was jobless and relied upon her for support. When she was seven months pregnant, respondent on the pretext of securing money left her for Marawi City and never returned. Thus, she was forced to raise their child with the help of her sister and brother-in-law.
On November 25, 1998, they met again. Respondent was then applying for appointment as a Regional Director of the Department of Natural Resources. They resumed their relationship, until they got married on January 17, 1999. On April 27, 2000, however, respondent left her again, this time without a word. She later discovered that the respondent returned to live with his former wife whom he had divorced in front of her (complainant), pursuant to the Code of Muslim Personal Laws.
Complainant then filed an administrative complaint filed on June 5, 2000 charging respondent judge of Grave Misconduct and Conduct Unbecoming a member of the Philippine Bar and Officer of the Court. She further alleged that the respondent filed his candidacy for party-list representative in the 1998 elections without ceasing to perform his judicial functions, and thus regularly collected his salary.

In his letter dated October 18, 2000, respondent submitted the complainants affidavit of desistance and adopted in toto her averments. In her affidavit, complainant stated that she filed the complaint because of the marital rift between her and respondent judge, and because she wanted an advantageous settlement of matrimonial feud under Islamic practice. She declared that the elders, whom she and respondent both chose, already accepted her apology. In accordance with Muslim traditions and cultural practices, she said a proper Muslim settlement of marital feud was arrived at and that both of them are now living in a cordial, supportive, and happy environment. Finally, complainant declared that she was no longer interested in pursuing the case against respondent.
The Supreme Court referred the case to a consultant of the Office of the Court Administrator (OCA), for evaluation, report and recommendation.

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ERMELYN A. LIMBONA v. JUDGE CASAN ALI LIMBONA [Case Digest]

A.M. No. SCC-03-08

Issue:
Whether or not the charge of Grave Misconduct and Conduct Unbecoming a member of the Philippine Bar and Officer of the Court is substantiated.

Held:
In the report of the OCA, it was found that the complainant failed to substantiate her allegations and recommended that the case be dismissed which was affirmed by the Supreme Court1. Administrative proceedings are not strictly bound by formal rules on evidence, but the liberality of procedure in administrative actions is still subject to limitations imposed by the fundamental requirement of due process. Even in an administrative case, the Rules of Court require that if the respondent judge should be disciplined for grave misconduct or any graver offense, the evidence against him should be competent and should be derived from direct knowledge. The judiciary to which the respondent belongs demands no less. Before any of its members could be faulted, competent evidence should be presented, especially since the charge is penal in character. After carefully reviewing the records of this case, the Supreme Court is convinced that there is utter lack of evidence to support the charge of grave misconduct. In administrative proceedings, complainants have the burden of proving by substantial evidence the allegations in their complaints. Yet, despite due notice to her, complainant failed to attend the hearings before the OCA, much less offer evidence in support of her complaint. In fact, the complainant recanted her allegations in her complaint through an affidavit of desistance, which the respondent judge presented to the OCA by way of comment. Nor is there independently verifiable proof of the respondent judges alleged misconduct. Thus, we are constrained to dismiss complainants principal charge against respondent for grave misconduct.

The matter of the respondent judge having filed his candidacy in the 1998 elections, while still receiving his salaries as a judge, is currently the subject of Administrative Matter No. SCC-98-4 pending before the Third Division of the Supreme Court.

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ANTONIO M. CARPIO, vs THE EXECUTIVE SECRETARY, THE SECRETARY OF LOCAL GOVERNMENTS, THE SECRETARY OF NATIONAL DEFENSE and THE NATIONAL TREASURER G.R. No. 96409 February 14, 1992 FACTS: In 1990, RA 6975 entitled AN ACT ESTABLISHING THE PHILIPPINE NATIONAL POLICE UNDER A REORGANIZED DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT, AND FOR OTHER PURPOSES was passed. Carpio, as a citizen, taxpayer, member of the bar and a defender of the Constitution, assailed the constitutionality of the said law for he figured that it only interferes with the control power of the president. He advances the view that RA 6975 weakened the National Police Commission by limiting its power to administrative control over the PNP thus, control remained with the Department Secretary under whom both the NPC and the PNP were placed. ISSUE: Whether or not the president abdicated its control power over the PNP and NPC by virtue of RA 6975. HELD: The President has control of all executive departments, bureaus, and offices. This presidential power of control over the executive branch of government extends over all executive officers from Cabinet Secretary to the lowliest clerk. Equally well accepted, as a corollary rule to the control powers of the President, is the Doctrine of Qualified Political Agency. As the President cannot be expected to exercise his control powers all at the same time and in person, he will have to delegate some of them to his Cabinet members. Under this doctrine, which recognizes the establishment of a single executive, all executive and administrative organizations are adjuncts of the Executive Department, the heads of the various executive departments are assistants and agents of the Chief Executive, and, except in cases where the Chief Executive is required by the Constitution or law to act in person on the exigencies of the situation demand that he act personally, the multifarious executive and administrative functions of the Chief Executive are performed by and through the executive departments, and the acts of the Secretaries of such departments, performed and promulgated in the regular course of business, are, unless disapproved or reprobated by the Chief Executive presumptively the acts of the Chief Executive. Thus, and in short, the Presidents power of control is directly exercised by him over the members of the Cabinet who, in turn, and by his authority, control the bureaus and other offices under their respective jurisdictions in the executive department.

The circumstance that the NAPOLCOM and the PNP are placed under the reorganized DILG is merely an administrative realignment that would bolster a system of coordination and cooperation among the citizenry, local executives and the integrated law enforcement agencies and public safety agencies created under the assailed Act, the funding of the PNP being in large part subsidized by the national government.

ANG TIBAY, represented by TORIBIO TEODORO, manager and propietor, and NATIONAL WORKERS BROTHERHOOD, petitioners, vs. THE COURT OF INDUSTRIAL RELATIONS and NATIONAL LABOR UNION, INC., respondents. G.R. No. L-46496, February 27, 1940, LAUREL, J.: FACTS: Petitioner Ang Tibay is a leather company owned and operated by Toribio Teodoro which supplies the Philippine Army. There are two labor unions in Ang Tibay; the private respondent National Labor Union, Inc. (NLU) and National Workers Brotherhood (NWB). One of the labor unions NWB is company or employer union dominated by Toribio hence he favors it over NLU. On September 26, 1938, there was allegedly a shortage of leather soles in Ang Tibay making it necessary for him to temporarily lay off the members of the National Labor Union Inc. However, private respondent NLU averred that said shortage of leather soles was false and Teodoro's letter to the Philippine Army dated September 29, 1938, (re supposed delay of leather soles from the States)that it was but a scheme to systematically prevent the forfeiture of this bond despite the breach of his contract with the Philippine Army. NLU also contended among others that the National Workers Brotherhood Union of Ang Tibay is a company or employer union dominated by Toribio Teodoro, the existence and functions of which are illegal. Hence, NLU prays for the vacation of the judgement rendered by the majority of this Court and the remanding of the case to the Court of Industrial Relations (CIR) for a new trial as they were able to come up with new evidence/documents that they were not able to obtain before as they were inaccessible and they were not able to present it before in the CIR. ISSUE: Whether or not NLU was accorded by CIR with due process of law hence they shall be granted a new trial RULING: The Supreme Court ruled that the NLU be accorded with new trial. The administrative bodies cannot ignore or disregard the fundamental and essential requirements of due process. The Court deemed it necessary to first in the interest of orderly procedure in cases of this nature, in interest of orderly procedure in cases of this nature, to make several observations regarding the nature of the powers of the Court of Industrial Relations and emphasize certain guiding principles which should be observed in the trial of cases brought before it. The Court of Industrial Relations is a special court whose functions are specifically stated in the law of its creation (Commonwealth Act No. 103). It is more an administrative than a part of the integrated judicial system of the nation. It is not intended to be a mere receptive organ of the Government. Unlike a court of justice which is essentially passive, acting only when its jurisdiction is invoked and deciding only cases that are presented to it by the parties litigant, the function of the Court of Industrial Relations, as will appear from perusal of its organic law, is more active, affirmative and dynamic. It not only exercises judicial or quasi-judicial functions in the determination of disputes between employers and employees but its functions in the determination of disputes between employers and employees but its functions are far more comprehensive and expensive. It has jurisdiction over the entire Philippines, to consider, investigate, decide, and settle any question, matter controversy or dispute arising between, and/or

affecting employers and employees or laborers, and regulate the relations between them, subject to, and in accordance with, the provisions of Commonwealth Act No. 103 (section 1). It shall take cognizance or purposes of prevention, arbitration, decision and settlement, of any industrial or agricultural dispute causing or likely to cause a strike or lockout, arising from differences as regards wages, shares or compensation, hours of labor or conditions of tenancy or employment, between landlords and tenants or farm-laborers, provided that the number of employees, laborers or tenants of farm-laborers involved exceeds thirty, and such industrial or agricultural dispute is submitted to the Court by the Secretary of Labor or by any or both of the parties to the controversy and certified by the Secretary of labor as existing and proper to be by the Secretary of Labor as existing and proper to be dealth with by the Court for the sake of public interest. (Section 4, ibid.) It shall, before hearing the dispute and in the course of such hearing, endeavor to reconcile the parties and induce them to settle the dispute by amicable agreement. (Paragraph 2, section 4, ibid.) When directed by the President of the Philippines, it shall investigate and study all industries established in a designated locality, with a view to determinating the necessity and fairness of fixing and adopting for such industry or locality a minimum wage or share of laborers or tenants, or a maximum "canon" or rental to be paid by the "inquilinos" or tenants or less to landowners. (Section 5, ibid.) In fine, it may appeal to voluntary arbitration in the settlement of industrial disputes; may employ mediation or conciliation for that purpose, or recur to the more effective system of official investigation and compulsory arbitration in order to determine specific controversies between labor and capital industry and in agriculture. There is in reality here a mingling of executive and judicial functions, which is a departure from the rigid doctrine of the separation of governmental powers. In the case of Goseco vs. Court of Industrial Relations et al., The Court pointed out that the Court of Industrial Relations is not narrowly constrained by technical rules of procedure, and the Act requires it to "act according to justice and equity and substantial merits of the case, without regard to technicalities or legal forms and shall not be bound by any technicalities or legal forms and shall not be bound by any technical rules of legal evidence but may inform its mind in such manner as it may deem just and equitable." (Section 20, Commonwealth Act No. 103.) It shall not be restricted to the specific relief claimed or demands made by the parties to the industrial or agricultural dispute, but may include in the award, order or decision any matter or determination which may be deemed necessary or expedient for the purpose of settling the dispute or of preventing further industrial or agricultural disputes. (section 13, ibid.) And in the light of this legislative policy, appeals to this Court have been especially regulated by the rules recently promulgated by the rules recently promulgated by this Court to carry into the effect the avowed legislative purpose. The fact, however, that the Court of Industrial Relations may be said to be free from the rigidity of certain procedural requirements does not mean that it can, in justifiable cases before it, entirely ignore or disregard the fundamental and essential requirements of due process in trials and investigations of an administrative character. There are primary rights which must be respected even in proceedings of this character: (1) The first of these rights is the right to a hearing, which includes the right of the party interested or affected to present his own case and submit evidence in support thereof. (2) Not only must the party be given an opportunity to present his case and to adduce evidence tending to establish the rights which he asserts but the tribunal must consider the evidence presented.

(3) "While the duty to deliberate does not impose the obligation to decide right, it does imply a necessity which cannot be disregarded, namely, that of having something to support it is a nullity, a place when directly attached." (4) Not only must there be some evidence to support a finding or conclusion (5) The decision must be rendered on the evidence presented at the hearing, or at least contained in the record and disclosed to the parties affected. (6) The Court of Industrial Relations or any of its judges, therefore, must act on its or his own independent consideration of the law and facts of the controversy, and not simply accept the views of a subordinate in arriving at a decision. (7) The Court of Industrial Relations should, in all controversial questions, render its decision in such a manner that the parties to the proceeding can know the various issues involved, and the reasons for the decision rendered. The performance of this duty is inseparable from the authority conferred upon it. In the right of the foregoing fundamental principles, it is sufficient to observe here that, except as to the alleged agreement between the Ang Tibay and the National Worker's Brotherhood, the record is barren and does not satisfy the thirst for a factual basis upon which to predicate, in a national way, a conclusion of law. This result, however, does not now preclude the concession of a new trial prayed for the by respondent National Labor Union, Inc., it is alleged that "the supposed lack of material claimed by Toribio Teodoro was but a scheme adopted to systematically discharged all the members of the National Labor Union Inc., from work" and this avernment is desired to be proved by the petitioner with the "records of the Bureau of Customs and the Books of Accounts of native dealers in leather"; that "the National Workers Brotherhood Union of Ang Tibay is a company or employer union dominated by Toribio Teodoro, the existence and functions of which are illegal." Petitioner further alleges under oath that the exhibits attached to the petition to prove his substantial avernments" are so inaccessible to the respondents that even within the exercise of due diligence they could not be expected to have obtained them and offered as evidence in the Court of Industrial Relations", and that the documents attached to the petition "are of such far reaching importance and effect that their admission would necessarily mean the modification and reversal of the judgment rendered herein. The Court has considered the reply of Ang Tibay and its arguments against the petition. The interest of justice would be better served if the movant is given opportunity to present at the hearing the documents referred to in his motion and such other evidence as may be relevant to the main issue involved. The legislation which created the Court of Industrial Relations and under which it acts is new. The failure to grasp the fundamental issue involved is not entirely attributable to the parties adversely affected by the result. Accordingly, the motion for a new trial should be and the same is hereby granted, and the entire record of this case shall be remanded to the Court of Industrial Relations, with instruction that it reopen the case, receive all such evidence as may be relevant and otherwise proceed in accordance with the requirements set forth hereinabove.

ARBOLEDA v. NLRC ENRIQUE A. ARBOLEDA, Petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and MANILA ELECTRIC COMPANY, Respondents. G.R. No. 119509 BELLOSILLO, J.: February 11, 1999 Second Division

FACTS: This is a petition for certiorari which seeks to reverse and set aside the decision of respondent National Labor Relations Commission reversing that of the Labor Arbiter sustaining petitioner on the ground of grave abuse of discretion. A certain Antonio Sy applied for electrical service for his residence and for his hardware store situated in the premises leased to him by the spouses Renato and Sylvia Cruz. Pending the processing of his application, Sy was found to have illegal electrical connection on two occasions, first on March 6, 1987, and then on June 8 of the same year. According to Sy, he went to the MERALCO office in Novaliches to pay for his Found Connection (FC) bills. There he met petitioner Arboleda who told him that he had to pay his bills amounting to around P2,000.00 for three months before a meter could be installed. Sy demurred saying he had with him only P1,200.00. Petitioner agreed to accept the said amount but did not issue any official receipt. Petitioner sent over Brigido Anonuevo and a certain Mulong to install the meter. Marcelo Umali, then manager of MERALCO Novaliches branch, happened to pass by Sy's house and noticed the illegal connection. He immediately confronted Sy who protested that he had paid his FC bills to petitioner. Umali then interviewed Sylvia Cruz about Sy's claims and she confirmed them. Sy immediately settled his FC bills with MERALCO for which he was issued an official receipt. His application for electrical service was granted after complying with all the requirements. Umali then submitted his recommendation to his immediate supervisor, R. A. Villanueva, to have Arboleda investigated. Atty. Anecito Mejorada of MERALCO's Special Presidential Committee wrote petitioner Arboleda notifying him that on October 27, 1987 an investigation would be conducted against him for misappropriation of FC bills, but petitioner sought a postponement of the investigation. On November 7, 1987 he was suspended pending his investigation. On November 9, 1987 the investigation proceeded with Juanito Rivera, Chief Steward and Vice-President of the employees' labor union, as petitioner's representative. In the investigation, Arboleda made a general denial about knowing Sy, Anonuevo and Mulong. He claimed that sometime thereafter Anonuevo went to his house bringing his Affidavit of Justification, Certificate of Attendance at a MERALCO Seminar and Sy's Affidavit of Desistance. Petitioner wrote the MERALCO investigators Jose Benalla and Eligio Reonal, Jr., informing them of the visit of Anonuevo and his wife to Sy's house along with Sylvia Cruz. Despite his suspension which lasted until his dismissal, petitioner continued to receive his salary of P11,332.50 from December 20, 1987 to February 11, 1988. Despite petitioners twenty five years of service, he was dismissed because of

violating Sec. 7, par. 1, of its Company Code of Employee Discipline for misappropriating or withholding company funds. Petitioner filed a case against MERALCO for illegal dismissal. He was subsequently sustained by the Labor Arbiter on three grounds: (a) Sy's accusation against him was only prompted by Umali; (b) Sy's credibility was suspect since he was apprehended thrice for illegal use of electric current; and, (c) Sy's motive was malicious and his testimony was made only to save his own skin. On appeal by MERALCO, the NLRC reversed the Labor Arbiter on the ground that: (a) there was no proof of instigation on the part of Umali; (b) Sy's testimony was credible; and, (c) Anonuevo's exculpating evidence in favor of Arboleda was a ruse. Hence, this petition. Petitioner contends that he was denied his right to due process during the investigation conducted by MERALCO as he did not have the opportunity to confront the witnesses against him.

ISSUE: Whether or not respondent accorded petitioner his right to due process making the latters dismissal from work legal and valid. RULING: Yes. Petitioner was afforded his right to due process and was legally dismissed from service. The requisites for the validity of a dismissal are the following: (a) the employee must be afforded due process, i.e., he must be given an opportunity to be heard and to defend himself, and (b) the dismissal must be for a valid cause as provided in Article 282 of the Labor Code. The essence of due process in administrative proceedings is an opportunity to explain one's side or an opportunity to seek reconsideration of the action or ruling complained of. Before an employee can be validly dismissed, the Labor Code requires the employer to furnish the employee with two written notices, to wit: (a) a written notice containing a statement of the cause for termination to afford the employee ample opportunity to be heard and defend himself with the assistance of his representative, if he so desires; and, (b) if the employer decides to terminate the services of the employee, the employer must notify him in writing of the decision to dismiss him, stating clearly the reasons therefor. MERALCO complied with the aforementioned requirements when it notified petitioner in a letter dated October 21, 1987 of the charges against him and of his right to be represented by a lawyer or representative, and when it gave him notice by letter dated February 11, 1988 of his dismissal and the reasons therefor. The requirement of notice and hearing in termination cases does not connote full adversarial proceedings as elucidated in numerous cases decided by the Supreme Court. Actual adversarial proceedings become necessary only for clarification or when there is a need to propound searching questions to witnesses who give vague testimonies. This is a procedural right which

the employee must ask for since it is not an inherent right, and summary proceedings may be conducted thereon. The burden of proving that the termination was for a valid or authorized cause in a termination case rests on the employer. MERALCO must not only rely on the weakness of petitioner's evidence but must stand on the merits of its own defense. The core of MERALCO's evidence is the testimony of Alberto Sy who identified petitioner as the one who received money from him for purposes of paying off his FC bills and for which the former did not issue an official receipt. This testimony of Sy was discredited by the Labor Arbiter in his belief that Sy did so with the ulterior motive of avoiding criminal prosecution because of his illegal connection and that he only complained due to the instigation of Umali. But the NLRC believed that Sy categorically denounced Arboleda without any promptings from Umali and that, despite petitioner's denials, Anonuevo was known to petitioner. The principle that factual findings of administrative bodies are binding upon the High Court may be sustained only when no issue of credibility is raised. But when the findings of fact of the NLRC do not agree with those of the Labor Arbiter, the Court must of necessity review the records to determine which findings should be preferred as more conformable to the evidentiary facts. The Supreme Court agreed with the NLRC. Sy categorically and spontaneously denounced petitioner without any prodding from Umali. That the testimony of Sy is credible is shown by the fact that his statements were replete with consistent and positive details congruent with human experience. Testimony is positive when the witness affirms that a fact did or did not occur, and negative when he says that he did not see or know of the factual occurrence. Positive testimony is entitled to greater weight than negative testimony. There is nothing on record to indicate any ulterior motive on the part of Sy to fabricate his testimony. Absent convincing evidence showing any cogent reason why a witness should testify falsely, his testimony may be accorded full faith and credit. Proof beyond reasonable doubt is not required for a judgment on the legality of an employee's dismissal, nor even preponderance of evidence for that matter, substantial evidence being sufficient. Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. The nature of petitioner's testimony is that of a general denial; consequently, as between an affirmative assertion and a general denial, weight must be accorded to the affirmative assertion. The Supreme Court cannot extend credence to the testimony of Anonuevo as it is only in the nature of negative assertions which are obviously in conflict with the affirmative statements of Sy. Coupled with the fact that Anonuevo seemed confused as to what the contract was all about as he did not seem to know for what was the amount supposedly given to him by Sy and in his affidavit, he admitted having returned the money to Sy after learning about Umali's memorandum-complaint against petitioner when such complaint was supposed to be confidential, clearly demonstrate that Anonuevo was merely used by the petitioner in an attempt to improve his lot.

It is evident that petitioner was guilty of serious misconduct to warrant his dismissal from the service which was lawfully effected with proper notice and for a just cause. Hence, the petition was dismissed for there was no finding of grave abuse of discretion on the part of the NLRC. Its assailed decision dismissing petitioner's complaint for illegal dismissal was affirmed by the Supreme Court.

SECRETARY OF JUSTICE SERAFIN R. CUEVAS vs ATTY. JOSEFINA G. BACAL G.R. No. 139382. December 6, 2000 MENDOZA, J.: FACTS: This case involves the appointment and transfer of career executive service officers (CESOs). More specifically, it concerns the appointment of respondent Josefina G. Bacal, who holds the rank of CESO III, to the position of Chief Public Attorney in the Public Attorneys Office, which has a CES Rank Level I, and her subsequent transfer, made without her consent, to the Office of the Regional Director of the PAO. On January 5, 1995, she was appointed by then President Fidel V. Ramos to the rank of CESO III. On November 5, 1997, she was designated by the Secretary of Justice as Acting Chief Public Attorney. On February 5, 1998, her appointment was confirmed by President Ramos so that, on February 20, 1998; she took her oath and assumed office. On July 1, 1998, petitioner Carina J. Demaisip was appointed chief public defender by then President Joseph Estrada. Apparently because the position was held by respondent, another appointment paper was issued by the President on July 6, 1998 designating petitioner Demaisip as chief public defender (formerly chief public attorney), PUBLIC DEFENDER'S OFFICE , DEPARTMENT OF JUSTICE vice ATTY. JOSEFINA G. BACAL, effective July 1, 1998. On the other hand, respondent was appointed Regional Director, Public Defenders Office by the President. On July 7, 1998, petitioner Demaisip took her oath of office. President Estrada then issued a memorandum, dated July 10, 1998, to the personnel of the Public Defenders Office announcing the appointment of petitioner Demaisip as CHIEF PUBLIC DEFENDER. Petitioner Secretary of Justice was notified of the appointments of petitioner Demaisip and respondent Bacal on July 15, 1998. On July 17, 1998, respondent filed a petition for quo warranto questioning her replacement as Chief Public Attorney. The petition, which was filed directly with this Court, was dismissed without prejudice to its refiling in the Court of Appeals. Accordingly, respondent brought her case in the Court of Appeals which, on March 25, 1999, ruled in her favor, finding her to be lawfully entitled to the Office of Chief Public Attorney. In its decision, the Court of Appeals declared respondent Josefina G. Bacal entitled to the position of Chief Public Attorney in the Public Attorneys Office. Petitioners moved for a reconsideration, but their motion was denied by the appeals court in its resolution dated July 22, 1999. Hence this petition for review on certiorari ISSUE: WHETHER OR NOT RESPONDENT BACAL FAILED TO FULLY EXHAUST THE ADMINISTRATIVE REMEDIES AVAILABLE TO HER BEFORE FILING THE PETITION FOR QUO WARRANTO WITH THE COURT OF APPEALS.

HELD: We first consider petitioners contention that respondents quo warranto suit should have been dismissed for failure of respondent to exhaust administrative remedies by appealing to the Office of the President. The contention has no merit. If, as has been held, no appeal need be taken to the Office of the President from the decision of a department head because the latter is in theory the alter ego of the former, there is greater reason for not requiring prior resort to the Office of the President in this case since the administrative decision sought to be reviewed is that of the President himself. Indeed, we have granted review in other cases involving the removal of the Administrator of the Philippine Overseas Employment Administration and the Executive Director of the Land Transportation Office[6] without requiring the petitioners to exhaust administrative remedies considering that the administrative actions in question were those of the President. In any event, the doctrine of exhaustion of administrative remedies does not apply when the question raised is purely legal. In this case, the question is whether respondents transfer to the position of Regional Director of the Public Attorneys Office, which was made without her consent, amounts to a removal without cause.

[ G.R. NO. 163186, February 28, 2007 ] EMERLITO F. AGUILA AND DANILO D. REYES, PETITIONERS, VS. CARMEN R. BALDOVIZO, EDGAR R. BALDOVIZO, AND CARMELO R. BALDOVIZO, RESPONDENTS. FACTS: On April 19, 1993, at about 11:30 a.m., Marlun Lisbos was driving, along the Epifanio de los Santos Avenue (EDSA) in Caloocan City, a van registered under the name of petitioner Danilo D. Reyes. The van sideswiped Fausto while he was crossing EDSA. Fausto fell on the pavement and was brought to the Manila Central University Hospital for treatment. Subsequently, Fausto died on July 6, 1993. On May 20, 1994, Marlun Lisbos was charged with reckless imprudence resulting in homicide. On September 24, 1994, Fausto's wife, Carmen R. Baldovizo, and children, Edgar and Carmelo, filed before the RTC of Quezon City, Branch 225, a separate complaint for damages against Marlun Lisbos, Danilo D. Reyes, petitioner Emerlito F. Aguila, the actual operator and possessor of the van, and Times Surety and Insurance Company, the insurer of the van under a third-party liability insurance contract. After the parties failed to arrive at a settlement, trial ensued. On March 7, 2000, the trial court rendered a decision in favor of plaintiffs. On May 4, 2000, petitioners Aguila and Reyes filed a petition for relief from judgment before the RTC of Quezon City, Branch 225. The trial court denied the petition in a Resolution dated November 20, 2000. Meanwhile, the Baldovizos moved for the issuance of a writ of execution after the judgment in their favor attained finality. On May 21, 2001, the trial court granted the motion for the issuance of a writ of execution and denied petitioners' motions. On August 13, 2001, the trial court resolved to strike off the name of Marlun Lisbos in the dispositive portion of its March 7, 2000 Decision for having been inadvertently included therein. Accordingly, the trial court issued an Amended Decision[8] dated August 13, 2001, which deleted the name of Marlun Lisbos as a party liable for damages. Petitioners Aguila and Reyes appealed the Amended Decision before the Court of Appeals. In denying the appeal for being improper, the appellate court ruled that Aguila and Reyes had lost their right to appeal. Since no appeal of the March 7, 2000 Decision was made within the reglementary period, the decision became final and executory. The Amended Decision did not give the parties a fresh period within which to file an appeal. Hence, this petition for review. ISSUE: Do the petitioners have the right to appeal the amended decision after the original decision had become final and executory?

HELD: No. Under Section 2,[9] Rule 36 of the Rules of Court, a judgment or final order becomes final and executory if no appeal or motion for new trial or reconsideration was filed within the period provided by the Rules. Before a judgment becomes final and executory, that judgment may be amended. Upon finality of the judgment, the court loses its jurisdiction to amend, modify or alter the same.[10] Except for correction of clerical errors or the making of nunc pro tunc entries which causes no prejudice to any party, or where the judgment is void, the judgment can neither be amended nor altered after it has become final and executory.[11] This is the principle of immutability of final judgment that is subject only to a few exceptions.[12] None of the exceptions are present in this case. Upon review of the records of this case, we note that petitioners received the March 7, 2000 Decision on April 24, 2000 and had until May 9, 2000 to file an appeal or a motion for new trial or reconsideration. During this period, petitioners filed instead a petition for relief from judgment on May 4, 2000. However, the trial court denied the petition. Unfortunately for the petitioners, their petition for relief from judgment was not the proper remedy because it is an extraordinary remedy available only if there are no other remedies. The remedies available to petitioners were the filing of an appeal, motion for reconsideration, or motion for new trial. Thus, the petition for relief from judgment did not toll the running of the reglementary period and, accordingly, the March 7, 2000 Decision became final and executory after the lapse thereof. Nevertheless, while the Resolution dated August 13, 2001, correcting the March 7, 2000 Decision, stated that the name of Marlun Lisbos was inadvertently included in the dispositive portion, hence, said name was ordered stricken off, the ensuing Amended Decision rendered on August 13, 2001 is null and void because any amendment or alteration made which substantially affects the final and executory judgment is null and void for lack of jurisdiction.[13] Although the rule that a judgment that becomes final and executory cannot be disturbed admits of exceptions, none of those are present in this case. Besides, it is not necessary to amend the original decision holding the petitioners, Marlun Lisbos, and the insurance company solidarily liable. In an action based on quasi-delict, the liability of the employer is direct and primary, subject to the defense of due diligence in the selection and supervision of the employee.[14] Thus, even if the driver was included albeit not served with summons, petitioners are directly and primarily liable. Thus, petitioners Aguila and Reyes as employer and registered owner or possessor-operator of the van, respectively, are solidarily liable in accordance with Article 2180[15] in relation to Articles 2184[16] and 2194[17] of the Civil Code. In view of the foregoing, there is no basis for petitioners to appeal the Amended Decision which is void. As for petitioners' plea for substantial justice, time and again, we have reminded the litigants that the Rules of Court are not mere tools that they can readily use or discard to serve their own purpose, but they are purposively devised for the proper administration of justice. Litigants should not, after resorting to a wrong remedy, then cry for liberal construction of these rules. For utter disregard of the rules cannot justly be rationalized by merely harking on the policy of liberal construction.[18]

WHEREFORE, the petition is DENIED for lack of merit. However, the Amended Decision dated August 13, 2001 of the Regional Trial Court of Quezon City, Branch 225, is declared void for lack of jurisdiction, and its original Decision dated March 7, 2000 is hereby reinstated. The total amount adjudged therein shall earn an interest rate of 6% per annum from the date of judgment of the trial court until finality of this Decision. Thereafter, the total amount adjudged shall earn an interest rate of 12% per annum until it is fully paid. Cost against petitioners. SO ORDERED.