GARMENTS and TEXTILE EXPORT BOARD (GTEB), petitioner, vs.

COURT OF APPEALS and AMERICAN INTER-FASHION

CORPORATION, respondents.
AMERICAN INTER-FASHION CORPORATION, petitioner, vs. GLORIOUS SUN FASHION GARMENTS MANUFACTURING
(PHILS.), INC. and GARMENTS and TEXTILE EXPORT BOARD (GTEB), respondents.
The doctrine of "primary jurisdiction" of Government administrative agencies has herein come into play. Should courts of justice
interfere with their purely administrative and discretionary functions and have supervisory powers over their proceedings and actions
involving the exercise of judgment and findings of fact? Verily, over matters falling under their jurisdiction, we have repeatedly held
that administrative agencies are in a better position to pass judgment thereon and their findings of fact in that regard are generally
accorded respect, if not finality, by the courts. [1]
In this connection, the Garments and Textile Export Board (GTEB) filed the herein petition for Certiorari from the January 21,
1994 Decision and the March 22, 1994 Resolution of the Court of Appeals in CA-G.R. SP No. 31596 (G.R. No. 114711). Up for our
resolution likewise is the petition for Certiorari filed by the American Inter-Fashion Corporation (AIFC) against the GTEB Resolution
of June 21, 1994 (G.R. No. 115889). These petitions, being interrelated, were ordered consolidated.
Antecedent facts to set us on a proper perspective are those lucidly set out by the Court of Appeals:

"Petitioner American Inter-Fashion Corporation (AIFC) was a corporation organized under Philippine Laws engaged in the business of
manufacturing and exporting garments. Prior to its incorporation, the original incorporators of AIFC were awarded the initial export quota (EQ)
allocation by virtue of the resolution of the Garments & Export Textile Board (GTEB) dated July 30, 1984.

Before AIFC's incorporation, Glorious Sun, a corporation organized under Philippine Laws sometime in 1977, was a recipient of a substantial
number of EQ allocations from the GTEB. On April 27, 1984, Glorious Sun was charged before the GTEB in OSC No. 84-B-1 with, and was
found guilty of, misdeclaration of values of its imported raw materials resulting in dollar salting, and other related frauds, in connection with its
importations in 1983. As a result, the EQs of Glorious Sun as well as its license to operate a bonded manufacturing warehouse were cancelled
and its stockholders and officers were disqualified from engaging in garment exports. Its export quotas were thereafter given to two newly-
formed corporations the De Soleil Apparel Manufacturing Corporation (De Soleil) and the herein petitioner American Inter-Fashion Corporation
(AIFC). These corporations were joint ventures of Hongkong investors and majority stockholders of Glorious Sun on one hand and, allegedly,
one member of the family and one crony of President Marcos on the other (American Inter-Fashion Corp. vs. Office of the President, 197 SCRA
409, 413 & 414 [1991]). The cancelled EQs of Glorious Sun which were given to AIFC pertains to those under Cat 347/8 equivalent to 113,341-
3 dozens which are the subject of dispute between GTEB and petitioner. Glorious Sun continues to claim its rights over the aforementioned EQ.

In the meantime, AIFC was able to maintain its EQ from 1984 up to the time of the filing of this petition (except for a brief period between 1986
and 1989 when AIFC was placed under sequestration) by continuously exporting or shipping out at least 95% of its current allocation as required
by the rules and regulations of the GTEB. This fact was not denied by the respondents.

With the establishment of a new government in 1986, Glorious Sun, on September 7, 1989, filed an appeal with the Office of the President,
which, in turn, set aside the GTEB decision adverse to Glorious Sun and remanded the case for genuine hearings where due process would be
accorded both parties (supra). This decision was upheld by the Supreme Court in a petition docketed as G.R. No. 92422 and entitled American
Inter-Fashion Corporation vs. Office of the President, GTEB and Glorious Sun. On May 23, 1991 and July 2, 1991, the Supreme Court, after
finding that 'x x x American Inter-Fashion x x x. was created obviously to be the recipient of export quotas arbitrarily removed from the rightful
owner [Glorious Sun]', affirmed the decision of the Office of the President remanding the case for further proceedings to the GTEB (supra, p.
426).

Pending its appeal to the Office of the President, Glorious Sun filed before the Securities and Exchange Commission (SEC) a Petition to Declare
the Forfeiture of the Registration of AIFC on June 16, 1987. This was docketed as SEC-AC No. 319. On May 24, 1990, the PED ordered the
revocation of AIFC's registration on the ground of 'fraud'. AIFC thereafter appealed to the SEC en banc, but the latter upheld the revocation on
May 22, 1992. The subsequent Motion for Reconsideration of AIFC was also denied by the SEC on September 16, 1992.

On September 30, 1992, the Petition for Review filed by AIFC before this Court docketed as CA-G.R. No. 29017 was denied for having been
filed beyond the reglementary period. This denial was upheld by the Supreme Court (3rd Division) in a Petition for Review docketed as G.R.
No. 107742. AIFC's subsequent Motion for Reconsideration was likewise denied on February 17, 1993 and on July 1, 1993, the Supreme
Court, en banc, upheld the cancellation of petitioner's certificate of registration with finality.

Meanwhile, on August 20, 1992, after further proceedings were conducted in OSC No. 84-B-1 concerning Glorious Sun's alleged violations and
frauds, the GTEB adopted a resolution which reads as follows:

'NOW THEREFORE, BE IT RESOLVED, as it is hereby resolved:

1. The instant case is hereby terminated with prejudice;

2. The disqualification of Glorious Sun and its principal stockholders and officers from engaging in the garments export business is hereby
lifted;

3. The bonded manufacturing warehouse license of Glorious Sun shall be restored subject to the condition that it shall within a reasonable period
of time, comply with the requirements for the operation of a BMW, and

4. The Board hereby awards to Glorious Sun the cancelled EQs of De Soleil Apparel Manufacturing Corporation as follows:
1.1 US Cat 347/348 = 63,839 dozens

1.2 Cat 2 Canada = 123,587 pieces

5. The Board, under existing rules, regulations and policies, is not in a position to restore the balance of the cancelled quotas.

(NOTE): Because:

1.1 Subject quota is currently being performed by AIF;

1.2 AIF vigorously contests Glorious Sun's claim for restoration, on the ground that AIF has already acquired vested rights over the quota;

1.3 The pending case with SEC (SEC-AC319) filed by Glorious Sun for cancellation of AIFC's corporate registration;

1.4 May 22, 1992-SEC, en banc Resolution cancelling AIFC's registration;

1.5 Pendency of AIFC's appeal with the Court of Appeals filed on September 25, 1992.' (Comments, Rollo, p. 78).

Incidentally, Glorious Sun also filed on September 21, 1992, GTEB Case No. 92-50 for the cancellation of the subject quotas allotted to AIFC
and for restoration of the same to Glorious Sun. This case has not yet been resolved by GTEB.

AIFC, on the other hand, prior to the Supreme Court denial of its petition for review of the cancellation of its registration, requested the GTEB to
release its EQ allocation for 1993. This request was, however, refused by the GTEB in a resolution dated January 11, 1993, for the following
reasons:

'x x relative to the request of American Inter-Fashion Corp. for the release of its 1993 Initial EQ/CEA entitlements under Cat. 347/8:

After a thorough discussion on the matter and, upon motion duly made and seconded, it was

RESOLVED, That pending final decision/resolution of the Supreme Court in the case of American Inter-Fashion Corp. (AIFC) vs. SEC, the
request of AIFC for release of its 1993 Initial EQ/CEA entitlements under Cat. 347/8, be, as it is hereby DEFERRED, pending study by the
Committee created under GTEB Office Order No. 92-1, dated September 11, 1992, and superseded by Office Order No. 92-2, dated November
7, 1992, to study and attend to the request of AIFC pertaining to the release of its export quotas which shall submit its findings/comments and
recommendation on the matter to the Board in its next meeting. However, with regard to subject firm's goods ready for shipment, it can
participate in the EQ allocation (flexibility) when the same is offered to enable them to fulfill their commitments.'

The above-quoted resolution was the subject of the petition filed by AIFC before the respondent Judge after GTEB refused to lift said order.
This case which was docketed as Special Civil Action Case No. 93-1173 for Certiorari, prayed for the annulment of GTEB's aforementioned
order, for the issuance of a temporary injunction restraining the implementation of said order, and for the immediate release of the regular EQ of
AIFC for 1993. A temporary restraining order (Annex D) was thereafter issued by respondent Judge on April 13, 1993, enjoining GTEB from
implementing its questioned order and from otherwise delaying the release of AIFC's EQ entitlement for 1993.

On April 20, 1993, GTEB filed a Motion to Dismiss and also moved to quash the above-mentioned temporary restraining order. Thereafter, on
May 3, 1993, the respondent Judge issued one of the Orders herein questioned which reads as follows:

'For resolution is the petitioner's prayer for the issuance of a writ of a preliminary prohibitory injunction x x x enjoining the GTEB and all
persons acting under them from implementing the resolution of the respondent GTEB, suspending the petitioner's export quota entitlement for
1993 and, a writ of preliminary mandatory injunction commanding the GTEB to release the petitioner's 1993 initial export quotas.

xxx xxx xxx

It is clear from the express terms of the questioned Resolution of the respondent Garments & Textile Export Board that the petitioner's export
quota has not been 'suspended' as claimed by the petitioner but was merely 'deferred' pending a study of certain matters by the committee created
by GTEB. Said resolution further made provisions for the petitioner's goods which are ready for shipment by stating in the questioned resolution
that 'with regard to subject firm's goods ready for shipment, it can participate in the REA flexibility when the same is offered to enable t hem to
fulfill their commitments.

Thus it is clear that the respondent GTEB has not as of this time, suspended or cancelled the petitioner's Export Quota but merely deferred its
release to the petitioner pending the resolution of certain matters. As a further indication that the GTEB has not suspended the petitioner's export
quota, is the fact that it has provided for temporary measures which allows the petitioner to ship its products which are ready for shipment i-n
order not to unduly cause damage to the petitioner.

WHEREFORE, in view of all the foregoing, the petitioner's prayer for writs of preliminary prohibitory and mandatory injunctions are hereby
DENIED.' (Annex A; Rollo, pp. 23-24)

AIFC's subsequent motion for reconsideration was likewise denied (Annex D). Hence, the instant petition.
Despite the Supreme Court's final decision upholding the cancellation of AIFC's certificate of registration, the latter, on July 13, 1993, filed
another Petition for Certiorari before the Supreme Court docketed as SC-G.R. No. 110771, against SEC and Glorious Sun, assailing the SEC
decision dated May 22, 1992 which ordered the revocation of AIFC's certificate of registration, and seeking to stop the cancellation of its
certificate of registration. This petition (G.R. No. 110771) was denied by the Supreme Court on August 11, 1992 on the ground that the
questioned decision of the SEC 'is the same decision assailed in a petition for review on certiorari filed with [the Supreme Court] on 23
November 1992 under Rule 45 of the Rules of Court, docketed as G.R. No. 107742. Records show that the petition (in G.R. No. 107742)
was denied and a motion for reconsideration of said denial was denied with finality in the resolution of the Court en banc, dated 01 July 1993'
(Annex A to Respondent's Memorandum; Rollo, p. 326). Petitioner's Motion for Reconsideration in G.R. No. 110771 is still pending resolution
by the Supreme Court.

In the meantime, AIFC was awarded by the GTEB a REA-Flexibility quota of exactly the same category and amount as that which is the subject
of this petition the release of which was deferred by the GTEB. This was done by the GTEB allegedly so as not to prejudice AIFC's export
commitments pending any action on its request for the release of its 1993 EQs. AIFC had allegedly performed on the REA-Flex quota since
January 1993 up to the present (Annex B to Respondent's Memorandum). The GTEB also allowed AIFC to continue importing raw materials 'to
service the balance of its REA-Flex quota' (Annex C; Respondents' Memorandum, p. 17). Incidentally, the difference between the REA-Flex
quota and the regular quota entitlement, is that the latter may be subject to restoration for the next quota year depending on performance of and
compliance while the former is only good for one-time use and may not be carried over to the next quota year (Respondent's Memorandum, p.
16; Rollo, p. 326).

On September 10, 1993, this Court in the instant petition and through the former Seventeenth Division, required petitioner to amend its petition
to include AIFC-International Fashion Corporation (hereinafter, AIFC-International) as co-petitioner considering AIFC's manifestation that it
underwent a business reorganization which resulted in the establishment of AIFC-International as its wholly-owned subsidiary and the transfer
to the latter of AIFC's regular export allocation with the GTEB (p. 167, Rollo).

Respondent GTEB objected to AIFC's motion to join AIFC-International as co-petitioner because the latter allegedly does not have any interest
in the case at bar. Furthermore, the SEC had issued a restraining order on August 31, 1993 enjoining AIFC or any of its agents from transferring
and conveying its assets to AIFC-International or any other subsidiary of AIFC (Annex A; p. 220, Rollo). The restraining order was issued in
connection with SEC Case No. 08-93-4546 filed by Yeung Chun Kam, Yeung Chun Ho, and Archie Chan vs. American Inter-Fashion Crop.
(Annex B, p. 221, Rollo).

It seems that Yeung Chun Kam, Yeung Chun Ho and Archie Chan are among the stockholders of petitioner AIFC known as the 'Hongkong
Investors' who allegedly own an aggregate thirty-three percent (33%) of the total subscription of AIFC's capital stock of P2.5 Million. They
alleged in their petition that they voted against the resolution adopted by AIFC which increased the corporation's capital stock from P2 Million
to P60 Million, which resolved that the authorized capital stock be paid-up with the advances of the Campa Group representing 63% of the
subscription of the capital stock of AIFC, and which also resolved that the corporation's creditors-stockholders would be given the right to
subscribe to the authorized capital stocks by converting their advances to the Corporation into equity.

The Hongkong group allegedly disagreed with and voted against the resolution since they wanted the additional paid-up capital to be entirely in
cash with all the stockholders infusing new money. The resolution was allegedly not implemented, instead, the Hongkong group claims to have
discovered that without their knowledge the Campa group organized and registered a partnership called American Inter-fashion Ltd., Co., as well
as another subsidiary, the AIFC-International. Claiming that these acts of establishing the two business entities violated their rights as minority
stockholders of AIFC, Yeung Chun Ho, Yeung Chun Kam and Archie Chan filed SEC Case No. 08-93-4546 seeking to restrain the transfer and
conveyance of AIFC's assets to AIFC-International and American Inter-Fashion Ltd., Co.; to cause the appointment of trustees for the purpose of
the liquidation of AIFC under Sec. 122 of the Corporation Code; and to order AIFC to provide Yeung Chun Kam and company copies of its
financial statements from 1989 to 1993 and to render an accounting of its operations during the said years (Rollo, pp. 222 to 235). This case is
still pending before the SEC."[2]

As can be seen, there were triggered by the controversy of the parties herein innumerable pleadings and interminable
complaints:
On April 7, 1993, AIFC filed a petition for certiorari, prohibition and mandamus under Rule 65 against the GTEB with the
Regional Trial Court of Makati, Branch 138, entitled "American Inter-Fashion Corporation, Petitioner, v. Garments and Textile Export
Board, Respondent" docketed as Civil Case No. 93-1173 (Annex "D" of GTEB's petition).
In the said petition AIFC sought to annul, on the alleged ground of lack of jurisdiction or grave abuse of discretion, the GTEB's
Resolution dated January 11, 1993 deferring AIFC's request for the release of its 1993 EQs (Initial EQ/CEA entitlements under Cat.
347/8) for the reasons therein stated. Said Resolution provided in part:

"RESOLVED, that pending final decision/resolution of the Supreme Court on the case of American Inter-Fashion Corp. (AIFC) vs. SEC, the
request of AIFC for release of its 1993 Initial EQ/CEA entitlements under Cat. 347/8, be, as it is hereby DEFERRED pending study by the
Committee created under GTEB Office Order No. 92-1, dated September 11, 1992, and superseded by Office Order No. 92-2, dated November
17, 1992, to study and attend to the request of AIFC pertaining to the release of its export quotas which shall submit its findings/comments and
recommendation on the matter to the Board in its next meeting. However, with regard to subject firm's goods ready for shipment, it can
participate in the REA flexibility when the same is offered to enable them to fulfill their commitments."

On April 13, 1993, the trial court issued a temporary restraining order against GTEB pending hearing on AIFC's application for
the issuance of a writ of preliminary prohibitory injunction.
On April 24, 1993, GTEB filed its "1. Motion to Dismiss the Instant Petition and 2. Motion to Quash or Recall the Temporary
Restraining Order."[3]
On April 29, 1993, GTEB filed its "Motion to Resolve Motion to Dismiss Prior to Hearing of the Petition for Injunction."[4]
 On or about 19 April 1993, Glorious Sun Fashion Garments Manufacturing (Phils.), Inc. (Glorious Sun) filed an "Urgent 1) Motion
for Leave to Intervene and File Answer as Respondent-Intervenor and 2) Motion to Quash or Recall Temporary Restraining Order."
This motion was opposed by AIFC.
In its Order dated May 3, 1993, the trial court denied AIFC's application for the issuance of the writs of preliminary prohibitory
and mandatory injunction. The pertinent portions of the May 3, 1993 Order [5] state:

"It is clear from the express terms of the questioned Resolution of the respondent Garments and Textile Export Board that the petitioner's export
quota has not been 'suspended' as claimed by the petitioner but was only 'Deferred' pending a study of certain matters by the committee created
by GTEB. Said resolution further made provisions for the petitioner's goods which are ready for shipment by stating in the questioned resolution
that 'with regard to subject firm's goods ready for shipment, it can participate in the REA flexibility when the same is offered to enable them to
fulfill their commitments.'

Thus, it is clear that the respondent GTEB has not as of this time, suspended or cancelled the petitioner's Export Quota but merely deferred its
release to the petitioner pending the resolution of certain matters. As a further indication that the GTEB has not suspended the petitioner's export
quota, is the fact that it has provided for temporary measures which allows the petitioner to ship its products which are ready for shipment in
order not to unduly cause damage to the petitioner.

WHEREFORE, in view of all the foregoing, the petitioner's prayer for writs of preliminary prohibitory and mandatory injunctions are hereby
DENIED."

Through its Order dated May 25, 1993,[6] the trial court denied AIFC's motion for reconsideration of the May 3, 1993 Order. As
a result thereof, AIFC filed with the Court of Appeals a petition for certiorari and mandamus from the aforementioned Orders of the
trial court in Civil Case No. 93-1173 (docketed as CA-G.R. SP No. 31596) where it prayed that the May 3, 1993 and May 25, 1993
Orders be set aside and a writ of mandamus be issued directing the GTEB to release AIFC's EQs for 1993.
Thereafter, AIFC filed a "Manifestation" where it alleged that in July 1993, it underwent a business reorganization which resulted
in the establishment of a wholly-owned subsidiary, the AIFC International Fashion Corporation. AIFC further alleged that its regular
export quota allocation with the GTEB was transferred to the aforesaid subsidiary, for which reason, the said subsidiary may be joined
as a co-petitioner in CA-G.R. SP No. 31596.
After the GTEB filed its "Comments" on the petition in CA-G.R. SP No. 31596 on August 19, 1993,[7] AIFC filed a
"Motion"[8] where it prayed that AIFC International Fashion Corporation be joined as a co-petitioner. Thereafter, on or about August
26, 1993, AIFC (and AIFC International) filed a "Reply" to the Comments of GTEB. [9]
Subsequent to the above, on September 14, 1993, upon being directed by the Court of Appeals to amend its petition to include
"AIFC International Fashion Corporation" as co-petitioner, AIFC filed an amended petition. [10]
After hearing the oral arguments of the GTEB and AIFC, and after receiving their respective memoranda,[11] as well as other
additional pleadings (including an "Addendum To Respondent's Memorandum"[12] filed by the GTEB for purposes of informing the
Court of Appeals of this Court's September 22, 1993 Resolution issued in G.R. No. 110771 denying with finality AIFC's motion for
reconsideration of the August 11, 1993 Resolution dismissing the said petition, and affirmed the revocation of AIFC's certificate of
corporate registration), or on January 21, 1994, the Court of Appeals rendered the Decision subject of GTEB's petition in G.R. No.
114711 in favor of AIFC and AIFC International,[13] annulling the trial court's Orders of May 3, 1993 and May 25, 1993 in this wise:

"WHEREFORE, the instant petition is GRANTED and the Orders of the respondent Judge dated May 3, 1993 and May 25, 1993 are hereby
annuled and set aside with no pronouncement as to costs."

On February 11, 1994, the GTEB filed a "Motion For Reconsideration"[14] of the 21 January 1994 Decision.
Shortly thereafter, motions to intervene as well as motions for reconsideration of the said Decision were filed by Glorious Sun
Fashion Garments Manufacturing Co., (Phils.) Inc. and by the minority stockholders of AIFC (Yeung Chun Kam, Yeung Chun Ho and
Archie Chan).
On or about January 31, 1994, on the ground that the Court of Appeals in its January 21, 1994 Decision had granted the petition,
AIFC and AIFC International filed a "Motion For Issuance Of Writ Of Mandamus"[15] asking that a writ of mandamus be issued to
compel the GTEB to release EQs for 1993 to AIFC.
On February 15, 1994, the GTEB filed its "Opposition To Petitioners' Motion for Issuance of Writ of Mandamus.[16]
On March 22, 1994, the Court of Appeals issued its Resolution[17] denying (1) AIFC and AIFC International's motion for the
issuance of a writ of mandamus, (2) the motions for intervention filed by Glorious Sun, and Yeung Chun Kam, et al., and (3) GTEB's
motion for reconsideration. The more pertinent portions of said Resolution read:

"It bears stressing that the subject matter of the petition as well as of the decision sought to be reconsidered was only the 1993 allocation. Our
decision herein did not concern itself with, nor was it called upon to rule upon, any future allocations the grant or release of which is the
prerogative of the GTEB in accordance with law.

We never ordered the GTEB to release the 1993 allocation to AIFC, since the lapse of the year 1993 had rendered this issue moot and academic.

We wish to make it clear that this Court is not intruding in, nor are we adjudicating upon ourselves, the powers and functions of the GTEB. The
decision to annul the orders in question was called for in view of the grave abuse of discretion exercised both by GTEB and the lower court in
refusing to release petitioner's 1993 allocations despite the fact that it was clearly entitled to such release. This is well within the jurisdiction of
this Court which has the authority to check the abuses which may have been committed by any officer, board or tribunal exercising judicial
functions (Sec. 1, Rule 65, Rules of Court).

Neither are we ordering the GTEB to release or grant export quota allocations to the transferee of AIFC's 1993 EQ allocations. The decision
never granted such right to the transferee since we know that this issue is solely within the jurisdiction of the GTEB. What the decision discussed
was petitioner's act of transferring the interest and assets of the former AIFC to its transferee. We do not consider this as an adjudication of
GTEB functions.

As regards the Motions to Intervene filed by Glorious Sun and Yeung Chun Kam and company, we find said motions improper. Intervention is
not an independent action but is auxiliary and supplemental to existing litigation (Clareza vs. Rosales, 2 SCRA 455). The office of a petition
for certiorari is only to check abuses or excesses in the exercise by a tribunal, board or officer, of its judicial functions and not to determine the
respective rights and interests of the parties in the subject matter of the litigation. This petition is therefore not the proper forum for the
discussion of the respective rights either or Glorious Sun or Yeung Chun Kam, and company. Whether or not Glorious Sun is entitled to quota
allocations is an issue which could be properly raised before the GTEB. And regarding the interests of Yeung Chun Kam and company vis-a-
vis those of AIFC's, the same should be properly ventilated in another appropriate proceeding.

Moreover, intervention is generally allowed only before or during trial (Sec. 2, Rule 12, Rules of Court) unless there are strong considerations to
allow such intervention. None exists in this case.

In view of the denial of the Motions to Intervene filed by Glorious Sun, Yeung Chun Kam and company, there is no reason for us to discuss their
motions for reconsideration.

WHEREFORE, premises considered, petitioner's Motion for the issuance of a Writ of Mandamus is DENIED. GTEB's motion for
reconsideration is also DENIED as well as the Motions for Intervention filed by Glorious Sun, Yeung Chun Kam, Yeung Chun Ho, and Archie
Chan."

GTEB thus filed its petition in G.R. No. 114711, where it prayed:

"WHEREFORE, premises considered, it is respectfully prayed that the 21 January 1994 Decision and 22 March 1994 Resolution of the Court of
Appeals (except insofar as the latter correctly denied AIFC and AIFC International Fashion Corporation's 'Motion For Issuance Of Writ Of
Mandamus') BE ANNULLED AND SET ASIDE; and that instead a Resolution be issued DISMISSING the petition in CA-G.R. SP No. 31596
in its entirety for being moot and academic and/or for lack of merit."

AIFC's petition in G.R. No. 115889, on the other hand, is an offshoot of the petition filed by Glorious Sun with the GTEB on 21
September 1992.[18] In said GTEB petition,[19] Glorious Sun prayed that the export quotas which the GTEB had earlier awarded to
AIFC on August 1, 1984 pursuant to its April 27, 1984 Decision in Adm. Case No. OSC 84-B-1, be cancelled and returned to Glorious
Sun, on the alleged ground that AIFC was not qualified to the said awards under the policies, rules and regulations of the GTEB, and
more specifically because:

"a. AIFC, at the time of the award on August 1, 1984, did not have its own in-house production capacity; in this connection, AIFC, to this
date, still has no in-house production capacity as it has continued not owning any factory, plant, or even a single sewing machine, nor
can it show any lease agreement for the use of any manufacturing facilities;

b. AIFC had no personality at the time of the award on August 1, 1984 as it was not yet a corporation, its incorporation having been
effected only on September 6, 1984; in this connection, on May 22, 1992, the certificate of registration of AIFC was revoked by order
of the Securities and Exchange Commission on the ground that the same was secured through fraud; and

c. AIFC, upon its incorporation, included as stockholders persons who were at the time disqualified from engaging in the garments export
business."

The events leading to the filing of GTEB Case No. 92-50 are in turn summed up in the succeeding paragraphs of Glorious Sun's
"Comment on Petition with Memorandum" dated August 1, 1995: [20]

"8. On 27 April 1984, the GTEB, on the basis of trumped-up charges of misdeclaration of importations, issued a Decision in Adm. Case No.
OSC 84-B-1, cancelling the export quotas and export authorizations of Glorious Sun, and on 01 August 1984 illegally awarded part thereof to
AIFC. The dispositive portion of said Decision reads thus:

'WHEREFORE, the Board finds that the Respondent firm violated its rules and regulations on importations and hereby imposes the following
administrative penalties:

1. Cancellation of Export Quotas and Export Authorizations of the firm and disqualification of the firm and the major stockholders and officers
from engaging in garment exports;

2. Cancellation of the firm's license to operate a bonded manufacturing warehouse.

The Board will likewise endorse the case to the Presidential Anti-Dollar Salting Task Force for further investigation and prosecution and will
request the Bureau of Customs to seal the firm's bonded manufacturing warehouse and to conduct an inventory of the contents thereof.'
9. Subsequently, Glorious Sun appealed the said Decision to the Office of the President. On September 7, 1989, the Office of the President, in
O.P. Case No. 3781, nullified the Decision of the GTEB in the succeeding manner:

'WHEREFORE, the case is hereby remanded to the Garments and Textile Export Board for further proceedings, affording the Appellant an
opportunity (a) of full disclosure of all the evidence and/or GTEB records relative to the charges in the Show Cause Order dated February 14,
1984, which evidence/records must be properly identified and their due execution and existence duly established by appropriate competent
witnesses, and (b) of rebutting the same evidence/records through the presentation of additional evidence, after which the Board may, on the
basis of said evidence and records, maintain or revise its decision in this case.'

10. Thereafter, acting on Motions for Reconsideration of its September 7, 1989 decision, the Office of the President, on February 20, 1990,
expanded its previous decision. The pertinent portion of the Resolution denying said motions are hereunder quoted, to wit:

'It is, however, insisted by the movants that the GTEB decision of April 27, 1984 had already become final and that Glorious Sun abandoned its
right when it elevated the case to the Supreme Court by way of certiorari, docketed as G.R. No. 67180, "Glorious Sun Fashion Garments and
Textile Manufacturing Company (Philippines), Inc. vs. Garments and Textile Export Board, etc. et al." We disagree. For, as explicitly shown by
the resolution promulgated on June 4, 1984 by the Supreme Court in the said case and as found by this Office in the decision presently sought to
be reconsidered, the said April 27, 1984 decision was rendered by the GTEB in flagrant violation of Glorious Sun's right to due process. Hence,
the GTEB may be said to have 'acted without or in excess of jurisdiction and with grave abuse of discretion' (Barranza vs. Campos, Jr. 120
SCRA 881, 888-889) and, therefore, the said decision is null and void(Bacus vs. Ople, 132 SCRA 690, 710; Free Employees and Workers Assn.
[FEWA] vs. Court of Industrial Relations, 14 SCRA 781, 784-787) as if it was not rendered at all. As succinctly held by the Supreme Court:

'In this jurisdiction, a void judgment or order is in legal effect no Judgment or order. By it no rights are divested. From it no rights can be
obtained. Being worthless, it neither binds nor bars anyone. All acts performed under it and all claims flowing out of it are void (Paredes vs.
Moya, 61 SCRA 525, 533, citing Chavez vs. Court of Appeals, 24 SCRA 663, 685; Comia vs. Nicolas, 29 SCRA 492, 503-504, quoting Chavez
vs. CA, supra, and Gomez vs. Concepcion, 47 Phil. 717, 722).

Thus, being null and void, rendered as it was in violation of the due process clause (Bacus vs. Ople, supra) and consequently for want of
jurisdiction (Barranza vs. Campos, Jr., supra), the GTEB decision of April 27, 1984 'is not a decision in contemplation of law' (Planas vs.
Collector of Internal Revenue, 3 SCRA 395, 399) and is, therefore, 'inexistent' (Free Telephone Workers Union vs. PLDT, 160 SCRA 43, 46).
Consequently, the same decision can 'never become final' (Manila Railroad Company vs. Moya, 14 SCRA 358, 363-364), much less executory
(Planas vs. Collector of Internal Revenue, supra). Indeed, the parties attempting to enforce (such void judgment) may be responsible as
'trespassers' (Comia vs. Nicolas, supra, at p. 504).

What right then could Glorious Sun have abandoned when, as illustrated by the aforecited authorities, the void and inexistent GTEB decision of
April 27, 1984 neither vests nor divests any rights, neither binds nor bars anyone?'

11. The Decision of the Office of the President was in turn upheld by the Supreme Court in a Resolution dated May 23, 1991 and another
Resolution dated July 2, 1991 in American Inter-Fashion Corporation v. Office of the President (197 SCRA 409 [1991]). In said case, the
Supreme Court, citing Mabuhay Textile Mills Corporation v. Ongpin (141 SCRA 437 [1986]), ruled that the export quota allocations of Glorious
Sun had evolved into some form of property right, which should not be removed from it arbitrarily and without due process. Thus:

'Contrary to the petitioner's posture, the record clearly manifests that in cancelling the export quotas of the private respondent GTEB violated the
private respondent's constitutional right to due process. Before the cancellation in 1984, the private respondent had been enjoying export quotas
granted to it since 1977. In effect the private respondent's export quota allocation which initially was a privilege evolved into some form of
property right which should not be removed from it arbitrarily and without due process only to hurriedly confer it on another. Thus, in the case
of Mabuhay Textile Mills Corporation v. Ongpin (Ibid), we stated:

'In the case at bar, the petitioner was never given the chance to present its side before its export quota allocations were revoked and its officers
suspended. While it is true that such allocations as alleged by the Board are mere privileges which it can revoke and cancel as it may deem fit,
these privileges have been accorded to petitioner for so long that they have become impressed with property rights especially since not only do
these privileges determine the continued existence of the petitioner with assets of over P80,000,000.00 but also the livelihood of some 700,000
workers who are employed by the petitioner and their families. x x x (Emphasis supplied).

The decision penned by Deputy Executive Secretary Magdangal B. Elma and the resolution penned by Acting Deputy Executive Secretary
Mariano Sarmiento II are not tainted in the slightest by any grave abuse of discretion. They outline in detail why the private respondent was
denied due process when its export quotas were cancelled by GTEB. The findings are supported by the records.

Finally, American Inter-Fashion is hardly the proper party to question the Malacaang decision. It was incorporated after the incidents in this case
happened. It was created obviously to be the recipient of export quotas arbitrarily removed from the rightful owner. It was sequestered precisely
because of the allegation that it is a crony corporation which profited from an act of injustice inflicted on another private corporation.

xxx xxx xxx

PREMISES CONSIDERED, the motion for reconsideration is GRANTED. The instant petition is DISMISSED. The questioned decision and
resolution of the Office of the President are hereby AFFIRMED (American Inter-Fashion Corporation v. Office of the President, 197 SCRA 409
[1991])'.

12. After the aforementioned Decision of the Office of the President was affirmed by the Supreme Court, and pursuant to the directive embodied
in the said O.P. Decision, the case was remanded to the GTEB for further proceedings. However, while Glorious Sun presented additional
evidence in support of its position, the GTEB did not, as it could not, present any evidence relative to the charges in the show Cause Order dated
14 February 1984. Instead, and in view of this dearth of evidence against Glorious Sun, the GTEB encouraged the latter to enter into a
compromise agreement.

13. Glorious Sun assented to the execution of a compromise agreement primarily on the basis of an understanding with the GTEB that insofar as
the balance of the export quotas due to Glorious Sun was concerned (which quotas AIFC was illegally and obstinately holding on to), Glorious
Sun would be allowed to initiate separate proceedings for the recovery thereof against AIFC. Incidentally, this arrangement was rendered
necessary by the fact that AIFC was never a proper party to, and had no personality to participate in Adm. Case No. OSC 84-B-1.

14.On August 20, 1992, the GTEB finally dismissed the complaint against Glorious Sun which formed the basis for the April 27, 1984 decision,
restoring part of the export quota allocations of Glorious Sun. The dispositive portion of the said Resolution reads:

'NOW THEREFORE, BE IT RESOLVED, as it is hereby resolved that:

a) The instant case is hereby terminated with prejudice;

b) The disqualification of Glorious Sun and its principal stockholders and officers from engaging in the garments export business is hereby
lifted;

c) The bonded manufacturing warehouse license of Glorious Sun shall be restored subject to the condition that it shall within a reasonable period
of time, comply with the requirements for the operations of a BMW, and

d) The Board hereby awards to Glorious Sun the canceled EQs of De Soleil Apparel Manufacturing Corporation as follows:

1. US Cat. 347/348-63,839 dzs.

2. Cat. 2 Canada-123,587 pcs.

e) The Board, under existing rules, regulations and policies, is not in a position to restore the balance of the cancelled quotas' (p. 4, GTEB
Resolution dated August 20, 1992).

15. It will be noted that the Board restored to Glorious Sun the portion of the export quotas illegally taken away from Glorious Sun and given to
DE Soleil Apparel Manufacturing Corporation (DSA), the same having been already taken back by the Board by cancellation. But, as stated
above, with respect to the balance of the export quotas illegally taken away from Glorious Sun still being stubbornly illegally held on to by
AIFC, additional steps became necessary for the recovery thereof.

16. Accordingly, on September 21, 1992, Glorious Sun filed GTEB Case No. 92-50 for the cancellation of the quotas illegally awarded to AIFC
and for the restoration of the said quotas to Glorious Sun.

17. On August 3, 1993, the Hearing Officer submitted his Report with the recommendation that AIFC's export quotas be revoked/cancelled and
the same be returned or awarded to Glorious Sun subject to GTEB rules and regulations on performance and forfeiture. However, instead of
approving the Report of the Hearing Officer assigned to hear the case and who conducted the proceedings, the GTEB appointed a committee to
prepare a Report.

18. The Committee submitted its Report and Recommendation under date of May 10, 1994. On June 21, 1994, the GTEB issued a Resolution
adopting and approving in toto the Report and Recommendation. The pertinent portion of the Resolution reads:

'THE FOREGOING PREMISES CONSIDERED, the Board hereby RESOLVES:

1. That the export quotas and export authorizations awarded to AIFC be cancelled;

2. That the petition of Glorious Sun to be restored the export quota allocations which were awarded to AIFC be denied;

3. That said export quotas and export authorizations of AIFC be reverted to the allocable balance (open basket) which shall be made available to
other garment manufacturers, including Glorious Sun, for application therefor; and

4. That AIFC's motion to dismiss be denied for lack of any merit.'

19. AIFC filed the instant petition to annul the above-quoted June 21, 1994 Resolution of the GTEB, as well as to compel the latter to restore the
cancelled export authorizations which AIFC claims it is entitled to."

After Glorious Sun presented evidence in support of its petition in GTEB Case No. 92-50, AIFC filed a motion to dismiss the
same for lack of jurisdiction.[21] On June 21, 1994, the GTEB issued its resolution subject of AIFC's petition in G.R. No. 115889, [22] the
entirety whereof reads as follows:
"RESOLVED, that the findings and recommendation of the Committee on Administrative Case No. 92-50, as contained in Annex 'C', be, as they
are hereby ADOPTED and APPROVED, in toto, wit:

1. That the export quotas and export authorizations awarded to AIFC be cancelled;

2. That the petition of Glorious Sun to be restored the export allocations which were awarded to AIFC be denied;

3. That the said export quotas and export authorizations of AIFC be reverted to the allocable balance which shall be made available to other
garment manufacturers, including Glorious Sun, for application therefor;

4. That AIFC's motion to dismiss be denied for lack of merit."

Consequently, on 6 July 1994, AIFC filed its petition in G.R. No. 115889, where it sought to:

"(a) annul and set aside the respondent Garments and Textile Export Board's (GTEB's) resolution dated 21 June 1994 in GTEB Case No. 92-0,
entitled Glorious Sun vs. AIFC, for having been issued without or in excess of jurisdiction, or in grave abuse of discretion; and

(b) have respondent GTEB commanded to restore or release petitioner AIFC's regular export quota entitlement for 1994." [23]

Simultaneous with the filing of its petition, AIFC filed a motion to consolidate the said petition with GTEB's petition in G.R. No.
114711. On July 20, 1994, after praying for time for the filing thereof, Glorious Sun filed, in G.R. No. 115889, a "Motion for Outright
Dismissal of the Petition (with Opposition to Motion to Consolidate), where it sought the dismissal of said petition on the grounds that
(1) AIFC has no personality to file the petition; (2) AIFC failed to exhaust administrative remedies; and (3) AIFC is guilty of forum-
shopping.
In view of Our July 20, 1994 Resolution: (1) requiring the respondents in G.R. No. 115889 to comment on the petition, and not
to file a motion to dismiss, and (2) granting AIFC's motion to consolidate, Glorious Sun filed a "Manifestation" on August 15, 1994
whereby it withdrew the aforesaid "Motion for Outright Dismissal of the Petition (with Opposition to Motion to Consolidate)." At the
same time it made manifest its intention to file a motion for reconsideration of the same July 20, 1994 Resolution insofar as it ordered
AIF's petition in G.R. No. 115889 consolidated with the GTEB's petition in G.R. No. 114711.
Accordingly, on September 7, 1994, Glorious Sun filed a "Motion for Reconsideration[24] with Motion to Suspend Period to File
Comment."
However, prior to the filing of Glorious Sun's aforesaid "Motion for Reconsideration, etc.," or on September 5, 1994, we issued
our Resolution in the above-numbered cases, where we resolved to:

"(a) NOTE WITHOUT ACTION the motions filed by: (1) Glorious Sun Fashion Garments Manufacturing in G.R. No. 115889 for first and
second extensions totalling fifteen (15) days from July 13, 1994 within which to file motion to dismiss petition and opposition to the motion to
consolidate; and (2) American Inter-Fashion Corporation [N.B. this should have read 'Glorious Sun Fashion Garments Manufacturing'] in G.R.
No. 114711 for the outright dismissal of the case with opposition to the motion to consolidate, it appearing that the: (1) motion for outright
dismissal with opposition to the motion to consolidate was withdrawn by private respondent Glorious Sun Fashion Garments Manufacturing in
G.R. No. 115889 through its manifestation dated August 11, 1994; and (2) motion to consolidate these cases was granted by the Second Division
on July 20, 1994;

(b) GRANT the motions of: (1) private respondent American Inter-Fashion corporation: (aa) for a fourth (final) extension of five (5) days from
July 23, 1994 within which to file comment on the petition for review on certiorari; and (bb) to admit comment on the petition in G.R. No.
114711;

(c) NOTE the: (1) urgent motion of petitioner in G.R. No. 115889 to resolve application for temporary restraining order or injunction; and (2)
comment on the petition with motion for the issuance of a show cause order filed by private respondent American Inter-Fashion Corporation in
G.R. No. 114711;

(d) require the petitioners [N.B. this should have read petitioner] to file a REPLY within ten (10) days from notice hereof to the comment on the
petition filed by American Inter-Fashion Corporation; and

(e) NOTE the manifestation dated August 12, 1994 by Atty. Benjamin D. de Asis, manifesting his withdrawal as counsel for petitioner Garments
and Textile Export Board in G.R. No. 114711 but require aforesaid counsel to SUBMIT the conformity of his client within five (5) days from
notice hereof." [25]

Thereafter, Glorious Sun filed on September 22, 1994 with the First Division of this Court, its "Manifestation and Motion to
Suspend Further Proceedings Until After Resolution by Second Division of Motion for Reconsideration of Order of July 20, 1994 on
Consolidation."[26] On the other hand, the GTEB, pursuant to Our above directive, filed its Reply to AIFC's Comment in G.R. No.
115889.
AIFC, as petitioner in G.R. No. 114711, filed with the Second Division of this Court an "Urgent Motion to Resolve Application
for Injunction,"[27] which it followed up with an "Urgent Motion to Restore Status Quo Ante."[28] The latter motion was filed with the
Third Division of this Court, to whom the above-numbered petitions had, in the meantime, been assigned. In response to these urgent
motions, Glorious Sun filed, also with the Third Division of this Court, its "Comment (Re: Petitioner's Urgent Motions: [1] to Resolve
Application for Injunction; and [2] to Restore Status Quo Ante)" where it argued that:
"I. The First Division of this Honorable Court, as far back as 05 September 1994, had already acted upon petitioner's urgent motion for the
issuance of a temporary restraining order or injunction, by merely noting the same.

II. In any event, the instant motions should nevertheless be denied, there being absolutely no showing that petitioner is clearly entitled to
injunctive relief."[29]

Subsequent to the filing of the above pleadings, AIFC filed yet another "Urgent Motion to Resolve," to which Glorious Sun replied
through a pleading denominated as "Manifestation (Re: Petitioner's March 30, 1995 Urgent Motion to Resolve) with Motion for
Summary Dismissal and Motion to Cite Petitioner for Direct Contempt (For Violation of SC Revised Circular 28-91)."[30]
On April 3, 1995, we issued a resolution, the pertinent portions whereof reads:

"Considering the allegations contained, the issues raised and the arguments adduced in the petitions for review on certiorari, as well as the
respective comments of the private respondents thereon and the replies of petitioner to said comments, the Court Resolved to give DUE
COURSE to the petition, and to require the parties to FILE their respective MEMORANDA in both cases, within twenty (20) days from notice.

The Court further Resolved:

xxx xxx xxx

(b) to NOTE:

(1) the urgent motion to resolve application for injunction, dated March 2, 1995, filed by counsel for petitioner American Inter-
Fashion Corporation; and

(2) the urgent motion to restore status quo ante, dated March 14, 1995, filed by counsel for petitioner."

Thereafter, both American Inter-Fashion Corporation and the GTEB filed their respective Memoranda. On the other hand, on
August 4, 1995, Glorious Sun filed its "Comment on Petition with Memorandum,"[31] which pleading included the succeeding
explanatory remarks:

"1. At the outset, it should be mentioned that contrary to the 05 April 1995 Resolution of the Honorable Court, Glorious Sun has not yet filed its
comment to American Inter-Fashion Corporation's (AIFC's) petition in the above-numbered case.

2. On 07 September 1994, Glorious Sun filed a motion for reconsideration of the order of this Honorable Court which consolidated the instant
petition with the petition of the Garments and Textile Export Board (GTEB) in G.R. No. 114711. Glorious Sun included in said motion for
reconsideration a 'Motion to Suspend Period to File Comment,' pending resolution by the Honorable Court of the consolidation incident.

3. Subsequent thereto, or on 22 September 1994, Glorious Sun filed a 'Manifestation and Motion to Suspend Further Proceedings Until After
Resolution by Second Division of Motion for Reconsideration of Order of July 20, 1994 on Consolidation.

4. In view of the filing of the aforementioned motions, Glorious Sun held off the filing of its comment to the petition until said motions were
resolved by the Honorable Court. To this day, however, no resolution has as yet been rendered by the Honorable Court relative to the above-
stated motions.

5. We surmise that the comment being referred to by the Honorable Court as having been filed by Glorious Sun is that which the latter filed in
connection with AIFC's Urgent Motions (1) to Resolve Application for Injunction; and (2) to Restore Status Quo Ante.

6. Be that as it may, Glorious Sun is filing the instant pleading which it prays be treated as its comment and memorandum." [32]

A "Motion for Leave to Intervene and Submit Manifestation"[33] in the above-entitled cases was subsequently filed by Messrs.
Yeung Chun Kam and Yeung Chun Ho, who purport to be the Hongkong investors referred to by American Inter-Fashion Corporation
in its 23 June 1995 Memorandum.
On July 19, 1996, Glorious Sun filed a "Manifestation," whereby it informed this Court of the May 20, 1996 Order of the Securities
and Exchange Commission (SEC), the entirety whereof reads thus:

"The articles of incorporation of American Inter-Fashion Corporation (the new AIFC, for short) with SEC Reg. No. AS093-008101-A reveal that
said corporation was formed for the purpose of re-registering American Inter-Fashion Corporation (the old AIFC) with SEC Reg. No. 12236
registered with the SEC on July 16, 1985 and that the same appear to have been approved by the Commission en banc in its Commission
meeting held on October 14, 1993. What was actually approved in said meeting was the 'registration of a new corporation' and that it was not the
intention of this Commission to approve the re-registration of the old AIFC.

American Inter-Fashion Corporation (SEC Reg. 12236), whose corporate registration had been ordered revoked, cannot avoid liquidation by
reason of the revocation of its franchise and it cannot also be allowed to continue its business by virtue of its so-called 're-registration.'

Viewed in this light, this Commission en banc hereby RECALLS the certificate of registration issued to American Inter-Fashion Corporation on
October 14, 1993 under SEC Reg. No. AS093-008101-A without prejudice to the registration of a new corporation."[34]
 In the same "Manifestation," Glorious Sun prayed, among others, for the dismissal of the above-entitled petitions, citing as
ground therefor the above-quoted SEC. Order recalling American Inter-Fashion Corporation's certificate of registration. Thereafter,
American Inter-Fashion Corporation filed its "Counter Manifestation (To Glorious Sun's Manifestation dated July 15, 1996),"[35] to
which Glorious Sun responded by way of its "Reply (Re: Counter-Manifestation)."[36]
In G.R. No. 114711, the GTEB made the following assignment of errors:

"I. The respondent Court of Appeals erred gravely in failing to rule that it had no jurisdiction over the petition in CA-G.R. SP No. 31596.

II. The respondent Court of Appeals erred gravely in failing to rule that the petition in CA-G.R. SP No. 31596 did not state a cause of
action against GTEB.

III. The respondent Court of Appeals erred gravely in failing to hold that the 11 January 1993 Resolution issued by GTEB was valid and in
the proper exercise of its administrative discretion and jurisdiction.

IV. The respondent Court of Appeals erred gravely in failing to hold that the petition in CA-G.R. SP No. 31596 was rendered moot and
academic in its entirety by the mere passage of the year 1993.

V. The respondent Court of Appeals erred gravely in failing to deny and/or to dismiss the petition in CA-G.R. SP No. 31596 for lack of
merit."[37]

On the other hand, AIFC makes the following assignment of errors in its petition: [38]

"The GTEB has no jurisdiction to take cognizance of Glorious Sun's action against AIFC for 'recovery' of property." [39]

"In any case, the GTEB's issuance of a resolution deciding the action on its 'merits' without hearing AIFC's evidence is a violation of
AIFC's right to due process."[40]

"The GTEB's cancellation of AIFC's EQs is a confiscation of property without due process of law."[41]

THE ISSUES

1. Considering that AIFC's Certificate of Registration had been effectively revoked by the Securities and Exchange
Commission on May 22, 1990, may AIFC still engage in business and claim entitlement to the export allocations subject of
these petitions?
2. Does the Garments and Textile Export Board (GTEB) have the power and authority to grant or cancel export quotas or
authorizations?
3. Did the GTEB, in issuing the assailed Resolutions, afford AIFC the right to due process?
I
This is not the first time that we have been asked to resolve an issue relative to AIFC's corporate personality. In G.R. No.
110711, entitled "American Inter-Fashion Corporation v. Securities and Exchange Commission, et al.," this Court en banc upheld the
resolutions of the Prosecution and Enforcement Department (PED) of the Securities and Exchange Commission (SEC) in PED Case
No. 87-0321 revoking AIFC's certificate of registration, on the basis of Glorious Sun's assertions that AIFC committed fraud and
misrepresentation in securing said certificate of registration, after we had likewise effectively upheld the very same resolutions in an
earlier petition filed by AIFC, entitled "American Inter-Fashion Corporation v. Court of Appeals, et al."[42]
In said G.R No. 110711, we recounted the factual circumstances pertinent to the revocation of AIFC's certificate of registration
in the succeeding manner:

"The complaint was assigned for investigation and hearing to SEC's Prosecution and Enforcement Department (PED). On 14 May 1990, PED
issued a resolution recommending the revocation of petitioner's SEC certificate of registration; however, on 24 May 1990, PED issued an
amended resolution this time revoking the said certificate on the basis of its ruling that 'there was in effect no payment of at least P1,657,000.00
of the P2,500,000.00 supposed payment on subscription, contrary to the treasurer's affidavit that the subscription of P2,500,000.00 was fully paid
and the payment had been fully received.' In PED's resolution of 15 October 1990, petitioner's motion for reconsideration was denied.

Acting on petitioner's appeal (docketed as Sec-AC No. 319) from the said resolutions of PED, the SEC affirmed the same, in its decisions of 22
May 1992. A copy of which was received by petitioner on 25 May 1992. Petitioner's motion for reconsideration was denied by the SEC in the
latter's order dated September 16, 1992, copy of which order was received by petitioner's counsel on September 18, 1992 (three [3] SEC
commissioners concurred; two [2] dissented). On September 25, 1992, petitioner then filed a petition for review with the Court of Appeals
docketed as CA-G.R. SP No. 29017. But on September 30, 1992, the Court of Appeals dismissed the petition on the ground that it was filed late
(last day to file petition was on September 19, 1992, but petition was filed only on September 25, 1992, thus, petition was filed six [6] days late).

On November 23, 1992, petitioner filed a petition for review (under Rule 45 of the Rules of Court) with this Court, docketed as G.R. No. 107742
assailing the resolution of the Court of Appeals in said CA-G.R. SP No. 29017, and questioning the SEC decision of 22 May 1992 in SEC-AC
No. 319. On January 13, 1993, this Court (Third Division) denied AIFC's petition, thus affirming the Court of Appeals' assailed resolution of
September 30, 1992, on the ground that the appellate court committed no reversible error in dismissing the petition in CA-G.R. SP No. 29017.
Petitioner's motion for reconsideration was referred to the Court en banc. On July 1, 1993 the Court en banc denied with finality petitioner's
motion for reconsideration and held that the reason given by petitioner's counsel for late filing of its petition (i.e. petition was filed late with the
Court of Appeals because petitioner's counsel Atty. Ceniza of Sycip Law got seriously ill) was not a valid excuse and not a compelling reason to
reconsider the Court's resolution of January 13, 1993.

Petitioner's counsel has filed the present petition (filed on 13 July 1993) under Rule 65 of the Rules of Court, assailing the same PED resolutions
and SEC decision assailed in G.R. No. 107742 (filed under Rule 45 of the Rules), this time on the ground that they were issued or rendered
without jurisdiction.

As earlier noted, substantially and even principally the same issues and subject matter are raised and involved in the present petition (filed under
Rule 65 of the Rules of Court) and those in the petition in G.R No. 107742 (filed under Rule 45 of the Rules).

In said G.R. No. 107742, petitioner had availed of the remedy of appeal by certiorari, i.e., appealing from the decision of the Court of Appeals
in CA-G.R. SP No. 29017. Settled is the rule that a special civil action of certiorari (under Rule 65) is not a substitute for a lost appeal (Bank of
America, et al., vs. CA, G.R No. 78917, June 8, 1990, 186 SCRA 417).

By the resolution of this Court en banc, dated July 1, 1993, rendered in G.R No. 107742, the petitioner's privilege (or opportunity) to question
the SEC decision dated May 22, 1993 rendered in SEC-AC No. 319 was lost when the Court sitting en banc denied with finality the motion of
petitioner to reconsider this Court's resolution of 13 January 1993, denying its petition for review (G.R. No. 107742).

Thus, since petitioner had already lost its privilege to question the SEC resolution dated May 22, 1992, petitioner can no longer assail the same
SEC resolution, not even by certiorari under Rule 65 of the Rules of Court. A contrary rule would swamp this Court with petitions
for certiorari under Rule 65 after an appeal is lost under Rule 45 of the Rules. This would subvert the long established public policy that
litigations must come to an end at one time or other.

But even granting ex gratia arguendo that petitioner can still avail itself of the remedy of a special civil action of certiorari (under Rule 65) said
remedy should be availed of within a reasonable period from the date of receipt of the assailed order/decision. In Reas vs. Bonife, we held that 'a
petition for certiorariunder Rule 65 is required to be filed within a reasonable period, no time frame being provided in the Rules within which
such petition has to be filed.' In the subsequent case of Philsec Workers' Union vs. Hon. Romeo A. Young (Resolution dated 22 January 1992,
G.R No. 101734), it was held that ninety (90) days from notice of the questioned order/decision is a reasonable period within which to file a
petition for certiorari under Rule 65.

In the present petition, the assailed decision of the respondent SEC dated May 22, 1992, was received by petitioner's counsel on May 25, 1992,
and the SEC's resolution denying petitioner's motion for reconsideration was received by petitioner on September 18, 1992. The present petition
was filed on July 13, 1993. From September 18, 1992 to July 13, 1993, almost ten (10) months had lapsed. Undoubtedly, said period of ten (10)
months is no longer a 'reasonable period' within which a petition for certiorari under Rule 65 may be filed.

As earlier said the denial of the petition in G.R No. 107742 is final. We must all be reminded of the settled rule that once a judgment has become
final, the issues raised therein should be laid to rest. Hence, the issues raised anew regarding the again assailed decision of SEC, dated May 22,
1992, in SEC-AC No. 319, are no longer open to debate and/or adjudication.

ACCORDINGLY, the present petition is DISMISSED."[43]

It appears that subsequent to the revocation of AIFC's certificate of registration, or on October 14, 1993, AIFC registered anew
with the SEC, this time under SEC Reg. No. AS093-008101-A under the name and style: AIFC International Fashion Corporation.
Evidently then, the AIFC which filed the petition in G.R No. 115889 is the AIFC which was "re-registered" on the above date, the
original AIFC's certificate of registration having been revoked with finality by virtue of our resolutions referred to in our above-quoted
11 August 1993 Resolution.[44] In the same manner, the AIFC which the GTEB refers to in its petition in G.R No. 114711 could not
have been any one other than this same "re-registered" AIFC, said petition having been filed subsequent to the revocation of the
original AIFC's certificate of registration.
It is obvious that the "re-registered" AIFC does not possess the legal personality necessary for it to prosecute these petitions.
In view of the May 20, 1990 Order of the SEC, "the certificate of registration issued to American Inter-Fashion Corporation on October
14, 1993 under SEC Reg. No. AS093-008101-A"[45] was revoked. For all legal intents and purposes, AIFC no longer exists, and it
may no longer claim to be entitled to the export allocations subject of these petitions. After all, it stands to reason that where there is
no claimant, there can be no claim. The AIFC International is a personality separate and distinct from AIFC. For this reason, we
cannot grant to AIFC International Fashion Corporation the personality to pursue the petition in G.R. No. 114711. It has not applied
for and is thus equally devoid of any personality to lay claim on the export allocations subject of said petition.
In fine, if only for AIFC's lack of legal personality to maintain its claim relative to the export allocations subject of these petitions,
its petition in G.R. No. 115889 is rendered dismissible. On the other hand, and in view likewise of this lack of legal personality, we
would be justified in annulling the January 26, 1994 and March 22, 1994 Resolutions of the Court of Appeals in CA-G.R. SP No.
31596, and in dismissing the said petition, as prayed for by the GTEB in G.R. No. 114711.
II
In support of its assertion that it is "the sole entity possessed with the power, jurisdiction and discretion to grant and disapprove
export allocations such as export quotas," the GTEB makes reference to Executive Order No. 537, as amended, including its
implementing rules and regulations, and the fact that among the functions of the GTEB therein enumerated are "the approval of
export allocations, as well as the monitoring, administration and regulation thereof."[46] Citing the doctrine of primary jurisdiction, the
GTEB further argues that being "a highly specialized administrative agency endowed with regulatory and quasi-judicial powers x x x
it enjoys the fundamental presumption that it has the technical expertise and mastery over such specialized matters, so much so that
its findings as to the latter would ordinarily deserve the respect of the courts." [47]
AIFC, on the other hand, argues that inasmuch as none of the powers specified in Executive Order 537, specifically Section 3
thereof, gives the GTEB any judicial powers, nor any specific jurisdiction to hear and decide actions, as the term is understood under
Section 1, Rule 2 of the Rules of Court, and inasmuch as GTEB Case No. 92-50 is such an action between private litigants, the GTEB
has no jurisdiction over said case.[48] To reinforce its argument, AIFC cites our ruling in Globe Wireless Ltd. v. PSC.[49] In said case,
we held:

"Too basic in administrative law to need citation of jurisprudence is the rule that the jurisdiction and powers of administrative agencies x x x are
limited to those expressly granted or necessarily implied from those granted in the legislation creating such body; and any order without or
beyond such jurisdiction is void and ineffective x x x"[50]

For its part, Glorious Sun joins the GTEB in the latter's assertion that it is the GTEB which has the jurisdiction to act and rule on
Glorious Sun's petition for the cancellation and restoration to it of the quotas awarded to AIFC. Thus it argues:

"48. Contrary to AIFC's assertions, it is beyond dispute that the GTEB has the jurisdiction to act and rule on Glorious Sun's Petition for the
cancellation and restoration to it of the quotas illegally awarded to AIFC. A simple reference to the pertinent provisions of the various Executive
Orders (E.O.s) relative to the functions of the GTEB easily reveals as much.

49. Under E.O. No. 952, which amended E.O. Nos. 537 and 823 it is provided:

'SECTION 1. Section 3 subparagraphs (a), (h), and (i) of Executive Order No. 537 [on the powers and functions of the Board] is hereby
amended to read as follows:

xxx xxx xxx

(h) In case of violations of its rules and regulations, cancel or suspend quota allocations, export authorizations and licenses for the operations of
bonded garment manufacturing warehouses or disqualify the firm and/or its principal stockholders and officers from engaging in garment
exports and from doing business with the Board; x x x'

50. Thus, if only on the basis of the above-quoted provision, and even in the face of the criteria set forth in Globe, it is at once evident that the
power to adjudicate on the question of the AIFC's entitlement to the subject EQs is 'necessarily implied' from the Board's power to 'cancel or
suspend quota allocations, export authorizations and licenses.'

xxx xxx xxx

51. However, in addition to the above, E.O. No. 913, entitled 'Strengthening the Rule-Making and Adjudicatory Powers of the Minister of Trade
and Industry in Order to Further Protect Consumers,' was likewise issued, which E.O., we respectfully submit, made the GTEB's power to
adjudicate on the question of the AIFC's entitlement to the subject EQs more than just being merely 'necessarily implied.'

52. Thus, Section 5 of Article III of the above-numbered E.O. reads:

SEC. 5. Formal investigation. (a) Whenever the Minister has verified that violation/s of 'Trade and Industry Laws' has/have been committed, he
may motu proprio charge said violator/s, and thereafter proceed with a formal investigation, independent of the corresponding criminal or civil
action for the said violation/s. The imposition of administrative penalties in the formal investigation is without prejudice to the imposition of
penalties in the criminal action and/or judgment in the civil action, and vice versa. Provided, however, that in deciding the case the Minister or
the judge, as the case may be, shall consider the decision of the other and impose further penalties, or consider the penalties imposed by the other
as already sufficient, as his sense of justice dictates.

(b) The Minister may proceed to hear and determine the violation in the absence of any party who has been served with notice to appear in the
hearing.

(c) The Minister shall use every and all reasonable means to ascertain the facts of the case speedily and objectively without regard to
technicalities of law or procedure and strict rules of evidence prevailing in courts of law and equity. The Minister shall decide the case within
thirty working days from the time the formal investigation was terminated.

(d) The minister shall have the same power to punish direct and indirect contempts granted to superior courts under Rule 71 of the Rules of
Court and the power to issue subpoena duces tecum.

(e) When the 'trade and industry law' violated provides for its own administrative procedure and penalties, including a procedure where a Board
Council, Authority, or Committee takes part as a body, the Minister shall have the option of selecting that procedure and penalties or the
procedure and penalties provided in this Executive Order. If he opts for the latter, the approval of such Board, Council, Authority, or Committee
of the Minister's decision shall not be necessary.'

53. The above-quoted provisions are very significant in light of the definition of the 'Ministry' as the Ministry of Trade and Industry 'an d/or any
of its bureaus, offices, or attached agencies, or any other office, unit or committee by whatever name which is placed under or attached to the
Ministry of Trade and Industry (Section 1, Article I, E.O. 913; Underscoring supplied).' The GTEB is one such bureau, office or agency.
54. In this connection, AIFC's statement to the effect that GTEB Case No. 92-50 is an action by one party against another for the enforcement or
protection of a right, is not entirely accurate. It will be remembered that said GTEB case was initiated principally for the purpose of securing the
cancellation of EQs being illegally held onto by AIFC, a proceeding which is undoubtedly within the ambit of the Board's powers; that Glorious
Sun stood to benefit from such cancellation was merely incidental to said proceeding."[51]

After examining the arguments raised by all parties concerned, we find the arguments of the GTEB and Glorious Sun to be
impressed with merit, and accordingly hold that the power and jurisdiction to adjudicate on the question of AIFC's entitlement to the
export allocations subject of the above-entitled petitions (be they export quotas or export authorizations), which includes the discretion
to grant and disapprove said export allocations, belongs solely to the GTEB, and not to the regular courts.
Semantics notwithstanding, it cannot be denied that GTEB Case No. 92-50 was instituted by Glorious Sun for the purpose of
securing the cancellation of EQs then alleged by it as being illegally held by AIFC. This being the case, it likewise cannot be denied
that, as Glorious Sun correctly observes, such a proceeding is clearly within the ambit of the GTEB's powers, more specifically, the
power granted to it by Section 3 subparagraph (h) of Executive Order No. 537 (as amended by E.O. No. 952) to "cancel or suspend
quota allocations, export authorizations and licenses for the operations of bonded garment manufacturing warehouses or disqualify
the firm and/or its principal stockholders and officers from engaging in garment exports and from doing business with the Board," in
case of violations of its rules and regulations.
In light of the above, AIFC's reliance on our ruling in Globe Wireless Ltd. v. PSC,[52] is clearly misplaced. On the basis of the
provisions of law cited by both the GTEB and Glorious Sun, that the power to adjudicate on the question of an entity's entitlement to
export allocations was expressly granted to the GTEB, or at the very least, was necessarily implied from the power to cancel or
suspend quota allocations, is beyond cavil.
In addition, we must take judicial notice of the fact that AIFC, in cases involving the same controversy as that in the above-
entitled petitions, has recognized the exclusive jurisdiction of the GTEB to award or cancel export allocations to deserving entities.
AIFC categorically declared in its "Motion to Dismiss," Civil Case No. 93-138[53] that "Executive Order No. 537, as amended by
Executive Order Nos. 823 and 952, vests upon defendant GTEB exclusive jurisdiction to grant export quota allocations," and that
"(u)nder the doctrine of primary jurisdiction, only defendant GTEB has the authority to award/cancel export quotas." In fact, it is
noteworthy that in said motion to dismiss, AIFC relied upon the very principles cited by both the GTEB and Glorious Sun in the above-
entitled petitions in support of their argument that it is the GTEB which has jurisdiction over the export allocations subject of said
petitions, to wit:

"Courts of justice should not generally interfere with purely administrative and discretionary functions; that courts have no supervisory power
over the proceedings and actions of the administrative departments of the government involving the exercise of judgment and findings of fact,
because by reason of their special knowledge and expertise over matters falling under their jurisdiction, the latter are in a better position to pass
judgment on such matters and their findings of facts in that regard are generally accorded respect, if not finality, by the courts. (Ateneo de
Manila v. CA, 145 SCRA 105)"[54]

AIFC reiterated this stance in its "Motion to Dismiss" in Civil Case No. 64010 [55] in this wise:

"As stated above, this Court cannot grant the reliefs sought in the Complaint without first deciding that AIFC is not entitled to EQs, and that, in
effect, the EQs now in AIFC's name should be cancelled. This power, however, has been granted not to the courts but to the GTEB, which is
vested with jurisdiction

'[i]n case of violations of its rules and regulations, [to] cancel or suspend quota allocations, export authorizations and licenses for the
operations of bonded garment manufacturing warehouses and/or to disqualify the firm and/or its principal stockholders and officers
from engaging in garment exports and from doing business with the Board (Section 3[h], Exec. Order No. 537 [1979], as amended by
Exec. Order No. 823 [1982] and Exec. Order No. 952 [1984]).'

And even assuming for argument that it is indeed vested with original jurisdiction to cancel EQs, under the doctrine of primary jurisdiction, this
Court cannot at this time take cognizance of the Complaint (Supra, at pp. 14-15)."

Having already invoked the jurisdiction of the GTEB in earlier actions involving the same controversy as that before us, AIFC
cannot now be heard to question that same jurisdiction simply because it was unable to obtain the reliefs prayed for by it from the
GTEB. We have warned against such a practice on more than one occasion in the past. Most recently, in St. Luke's Medical Center,
Inc. v. Torres,[56] we reiterated such warning:

"It is a settled rule that a party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and after failing to obtain
such relief, repudiate or question that same jurisdiction. A party cannot invoke jurisdiction at one time and reject it at another in the same
controversy to suit its interests and convenience. The Court frowns upon and does not tolerate the undesirable practice of some litigants who
submit voluntarily a cause and then accepting the judgment when favorable to them and attacking it for lack of jurisdiction when adverse
(Tajonera v. Lamaroza, 110 SCRA 447, citing Tijam v. Sibonghanoy, 23 SCRA 35)."[57]

III
As to the allegations of AIFC that it was deprived of due process, we find no merit to this contention. With respect to the June
21, 1994 Resolution of the GTEB which AIFC assails in its petition in G.R No. 115889, it is AIFC's contention that the GTEB issued
said resolution[58]without giving AIFC the opportunity to be heard and without receiving its evidence in any form.
We disagree.
 Insofar as the supposed failure of the GTEB to issue a show cause order to AIFC is concerned, we hold that the GTEB committed
no grave abuse of discretion in instituting an action against AIFC on the basis of the allegations in Glorious Sun's petition in GTEB
Case No. 92-50. It is apparent from the rule cited by AIFC[59] that the same was aimed primarily at ensuring that if any action is to be
filed against a respondent, the same must have sufficient basis in fact. Consequently, for so long as this goal is achieved, albeit
through some other means, no undue prejudice can be caused by the non-issuance of a show-cause order. In fact, as correctly
pointed out by Glorious Sun, the GTEB, as a bureau, office or agency attached to the Ministry of Trade and Industry, may even motu
proprio charge violators of "Trade and Industry Laws," and thereafter proceed with a formal investigation. [60]
Anent AIFC's claim that it was not afforded the opportunity to present evidence in GTEB Case No. 92-50, we find such claim
unworthy of belief. The GTEB, as an administrative agency, has in its favor the presumption that it has regularly performed its official
duties, including those which are quasi-judicial in nature. In the absence of clear facts to rebut the same, said presumption of regularity
must be upheld. This is also but in keeping with the doctrine of primary jurisdiction.
We are inclined to give credence instead to Glorious Sun's assertions relative to AIFC's presentation of evidence in GTEB Case
No. 92-50, there being ample basis in the records therefor. Thus, after examining the "Motion to Dismiss" filed by AIFC in GTEB Case
No. 92-50,[61] we find nothing therein to indicate that AIFC reserved its right to present evidence in said GTEB case, contrary to AIFC's
claims. On the other hand, as correctly pointed out by Glorious Sun, if any reservation was made by AIFC in its "Sur Rejoinder (Re:
Motion to Dismiss)," attached to AIFC's petition as Annex "E," this was limited to the reservation "to raise the question of
jurisdiction."[62]
More importantly, it is apparent that not only was AIFC afforded the opportunity to present evidence, it actually took advantage
of this opportunity by presenting documentary evidence, as asserted by Glorious Sun, an assertion which AIFC most notably failed
to refute. As we have declared time and again, what is repugnant to due process is the denial of the opportunity to be heard.[63] That
AIFC was afforded this opportunity is beyond question.
From what has been discussed the following conclusions are made:

(1) AIFC no longer has the legal personality to prosecute the above-entitled petitions and may therefore no longer claim entitlement to the export
allocations subject of these petitions;

(2) It is the GTEB, and not the regular courts, nor the Court of Appeals, which has the jurisdiction to adjudicate on the question of AIFC's
entitlement to the export allocations subject to these petitions; and

(3) AIFC's right to due process was in no wise violated by the GTEB, the former not having taken advantage of the opportunity afforded to it to
present evidence in its behalf.

WHEREFORE, AIFC's petition in G.R. No. 115889 is hereby DENIED for lack of merit, as well as for being moot and academic,
AIFC having lost the legal personality to prosecute the same. GTEB's petition is GRANTED, and the assailed January 21, 1994
Decision and March 22, 1994 Resolution of the Court of Appeals in CA-G.R. SP No. 31596 is hereby ANNULLED AND SET ASIDE
(except insofar as it denied AIFC and AIFC International Fashion Corporation's "Motion for Issuance of Writ of Mandamus"). Said
CA-G.R SP No. 31596 is likewise ordered annulled and set aside.
EN BANC

[G.R. Nos. 147062-64. December 14, 2001]

REPUBLIC OF THE PHILIPPINES, represented by the PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT

(PCGG), petitioner, vs. COCOFED et al. and BALLARES et al., [1] EDUARDO M. COJUANGCO JR. and the
SANDIGANBAYAN (First Division) respondents.

DECISION
PANGANIBAN, J.:

The right to vote sequestered shares of stock registered in the names of private individuals or entities and alleged to have been acquired with
ill-gotten wealth shall, as a rule, be exercised by the registered owner. The PCGG may, however, be granted such voting right provided it can (1)
show prima facie evidence that the wealth and/or the shares are indeed ill-gotten; and (2) demonstrate imminent danger of dissipation of the assets,
thus necessitating their continued sequestration and voting by the government until a decision, ruling with finality on their ownership, is
promulgated by the proper court.
However, the foregoing two-tiered test does not apply when the sequestered stocks are acquired with funds that are prima facie public in
character or, at least, are affected with public interest. Inasmuch as the subject UCPB shares in the present case were undisputably acquired with
coco levy funds which are public in character, then the right to vote them shall be exercised by the PCGG. In sum, the public character test, not
the two-tiered one, applies in the instant controversy.

The Case
 Before us is a Petition for Certiorari with a prayer for the issuance of a temporary restraining order and/or a writ of preliminary injunction
under Rule 65 of the Rules of Court, seeking to set aside the February 28, 2001 Order [2] of the First Division of the Sandiganbayan[3] in Civil Case
Nos. 0033-A, 0033-B and 0033-F. The pertinent portions of the assailed Order read as follows:

In view hereof, the movants COCOFED, et al. and Ballares, et al. as well as Eduardo Cojuangco, et al., who were acknowledged to be registered
stockholders of the UCPB are authorized, as are all other registered stockholders of the United Coconut Planters Bank, until further orders from
this Court, to exercise their rights to vote their shares of stock and themselves to be voted upon in the United Coconut Planters Bank (UCPB) at
the scheduled Stockholders Meeting on March 6, 2001 or on any subsequent continuation or resetting thereof, and to perform such acts as will
normally follow in the exercise of these rights as registered stockholders.

Since by way of form, the pleadings herein had been labeled as praying for an injunction, the right of the movants to exercise their right as
abovementioned will be subject to the posting of a nominal bond in the amount of FIFTY THOUSAND PESOS (P50,000.00) jointly for the
defendants COCOFED, et al. and Ballares, et al., as well as all other registered stockholders of sequestered shares in that bank, and FIFTY
THOUSAND PESOS (P50,000.00) for Eduardo Cojuangco, Jr., et al., to answer for any undue damage or injury to the United Coconut Planters
Bank as may be attributed to their exercise of their rights as registered stockholders.[4]

The Antecedents

The very roots of this case are anchored on the historic events that transpired during the change of government in 1986. Immediately after
the 1986 EDSA Revolution, then President Corazon C. Aquino issued Executive Order (EO) Nos. 1, [5] 2[6] and 14.[7]

On the explicit premise that vast resources of the government have been amassed by former President Ferdinand E. Marcos, his immediate
family, relatives, and close associates both here and abroad, the Presidential Commission on Good Government (PCGG) was created by
Executive Order No. 1 to assist the President in the recovery of the ill-gotten wealth thus accumulated whether located in the Philippines or
abroad.[8]

Executive Order No. 2 states that the ill-gotten assets and properties are in the form of bank accounts, deposits, trust accounts, shares of
stocks, buildings, shopping centers, condominiums, mansions, residences, estates, and other kinds of real and personal properties in the Philippines
and in various countries of the world. [9]
Executive Order No. 14, on the other hand, empowered the PCGG, with the assistance of the Office of the Solicitor General and other
government agencies, inter alia, to file and prosecute all cases investigated by it under EO Nos. 1 and 2.
Pursuant to these laws, the PCGG issued and implemented numerous sequestrations, freeze orders and provisional takeovers of allegedly ill-
gotten companies, assets and properties, real or personal. [10]
Among the properties sequestered by the Commission were shares of stock in the United Coconut Planters Bank (UCPB) registered in the
names of the alleged one million coconut farmers, the so-called Coconut Industry Investment Fund companies (CIIF companies) and Private
Respondent Eduardo Cojuangco Jr. (hereinafter Cojuangco).
In connection with the sequestration of the said UCPB shares, the PCGG, on July 31, 1987, instituted an action for reconveyance, reversion,
accounting, restitution and damages docketed as Case No. 0033 in the Sandiganbayan.
On November 15, 1990, upon Motion[11] of Private Respondent COCOFED, the Sandiganbayan issued a Resolution [12] lifting the
sequestration of the subject UCPB shares on the ground that herein private respondents -- in particular, COCOFED and the so-called CIIF
companies had not been impleaded by the PCGG as parties-defendants in its July 31, 1987 Complaint for reconveyance, reversion, accounting,
restitution and damages. The Sandiganbayan ruled that the Writ of Sequestration issued by the Commission was automatically lifted for PCGGs
failure to commence the corresponding judicial action within the six-month period ending on August 2, 1987 provided under Section 26, Article
XVIII of the 1987 Constitution. The anti-graft court noted that though these entities were listed in an annex appended to the Complaint, they had
not been named as parties-respondents.
This Sandiganbayan Resolution was challenged by the PCGG in a Petition for Certiorari docketed as GR No. 96073 in this Court. Meanwhile,
upon motion of Cojuangco, the anti-graft court ordered the holding of elections for the Board of Directors of UCPB. However, the PCGG applied
for and was granted by this Court a Restraining Order enjoining the holding of the election. Subsequently, the Court lifted the Restraining Order
and ordered the UCPB to proceed with the election of its board of directors. Furthermore, it allowed the sequestered shares to be voted by their
registered owners.
The victory of the registered shareholders was fleeting because the Court, acting on the solicitor generals Motion for
Clarification/Manifestation, issued a Resolution on February 16, 1993, declaring that the right of petitioners [herein private respondents] to vote
stock in their names at the meetings of the UCPB cannot be conceded at this time. That right still has to be established by them before the
Sandiganbayan. Until that is done, they cannot be deemed legitimate owners of UCPB stock and cannot be accorded the right to vote them. [13] The
dispositive portion of the said Resolution reads as follows:

IN VIEW OF THE FOREGOING, the Court recalls and sets aside the Resolution dated March 3, 1992 and, pending resolution on the merits of
the action at bar, and until further orders, suspends the effectivity of the lifting of the sequestration decreed by the Sandiganbayan on November
15, 1990, and directs the restoration of the status quo ante, so as to allow the PCGG to continue voting the shares of stock under sequestration at
the meetings of the United Coconut Planters Bank. [14]

On January 23, 1995, the Court rendered its final Decision in GR No. 96073, nullifying and setting aside the November 15, 1990 Resolution
of the Sandiganbayan which, as earlier stated, lifted the sequestration of the subject UCPB shares. The express impleading of herein Respondents
COCOFED et al. was deemed unnecessary because the judgment may simply be directed against the shares of stock shown to have been issued in
consideration of ill-gotten wealth.[15] Furthermore, the companies are simply the res in the actions for the recovery of illegally acquired wealth,
and there is, in principle, no cause of action against them and no ground to implead them as defendants in said case. [16]
A month thereafter, the PCGG -- pursuant to an Order of the Sandiganbayan -- subdivided Case No. 0033 into eight Complaints and docketed
them as Case Nos. 0033-A to 0033-H.
Six years later, on February 13, 2001, the Board of Directors of UCPB received from the ACCRA Law Office a letter written on behalf of
the COCOFED and the alleged nameless one million coconut farmers, demanding the holding of a stockholders meeting for the purpose of, among
others, electing the board of directors. In response, the board approved a Resolution calling for a stockholders meeting on March 6, 2001 at three
oclock in the afternoon.
On February 23, 2001, COCOFED, et al. and Ballares, et al. filed the Class Action Omnibus Motion [17] referred to earlier in Sandiganbayan
Civil Case Nos. 0033-A, 0033-B and 0033-F, asking the court a quo:
1. To enjoin the PCGG from voting the UCPB shares of stock registered in the respective names of the more than one million coconut
farmers; and
2. To enjoin the PCGG from voting the SMC shares registered in the names of the 14 CIIF holding companies including those
registered in the name of the PCGG. [18]
On February 28, 2001, respondent court, after hearing the parties on oral argument, issued the assailed Order.
Hence, this Petition by the Republic of the Philippines represented by the PCGG. [19]
The case had initially been raffled to this Courts Third Division which, by a vote of 3-2,[20] issued a Resolution[21] requiring the parties to
maintain the status quo existing before the issuance of the questioned Sandiganbayan Order dated February 28, 2001. On March 7, 2001,
Respondent COCOFED et al. moved that the instant Petition be heard by the Court en banc. [22] The Motion was unanimously granted by the Third
Division.
On March 13, 2001, the Court en banc resolved to accept the Third Divisions referral. [23] It heard the case on Oral Argument in Baguio City
on April 17, 2001. During the hearing, it admitted the intervention of a group of coconut farmers and farm worker organizations, the Pambansang
Koalisyon ng mga Samahang Magsasaka at Manggagawa ng Niyugan (PKSMMN). The coalition claims that its members have been excluded
from the benefits of the coconut levy fund. Inter alia, it joined petitioner in praying for the exclusion of private respondents in voting the
sequestered shares.

Issues

Petitioner submits the following issues for our consideration:[24]

A.

Despite the fact that the subject sequestered shares were purchased with coconut levy funds (which were declared public in character) and the
continuing effectivity of Resolution dated February 16, 1993 in G.R. No. 96073 which allows the PCGG to vote said sequestered shares,
Respondent Sandiganbayan, with grave abuse of discretion, issued its Order dated February 28, 2001 enjoining PCGG from voting the
sequestered shares of stock in UCPB.

B.

The Respondent Sandiganbayan violated petitioners right to due process by taking cognizance of the Class Action Omnibus Motion dated 23
February 2001 despite gross lack of sufficient notice and by issuing the writ of preliminary injunction despite the obvious fact that there was no
actual pressing necessity or urgency to do so.

In its Resolution dated April 17, 2001, the Court defined the issue to be resolved in the instant case simply as follows:

Did the Sandiganbayan commit grave abuse of discretion when it issued the disputed Order allowing respondents to vote UCPB shares of
stock registered in the name of respondents?

This Courts Ruling

The Petition is impressed with merit.

Main Issue: Who May Vote the Sequestered Shares of Stock?

Simply stated, the gut substantive issue to be resolved in the present Petition is: Who may vote the sequestered UCPB shares while the main
case for their reversion to the State is pending in the Sandiganbayan?
 This Court holds that the government should be allowed to continue voting those shares inasmuch as they were purchased with coconut levy
funds -- funds that are prima facie public in character or, at the very least, are clearly affected with public interest.
General Rule: Sequestered Shares Are Voted by the Registered Holder

At the outset, it is necessary to restate the general rule that the registered owner of the shares of a corporation exercises the right and the
privilege of voting.[25] This principle applies even to shares that are sequestered by the government, over which the PCGG as a mere conservator
cannot, as a general rule, exercise acts of dominion. [26] On the other hand, it is authorized to vote these sequestered shares registered in the
names of private persons and acquired with allegedly ill-gotten wealth, if it is able to satisfy the two-tiered test devised by the Court
in Cojuangco v. Calpo[27] and PCGG v. Cojuangco Jr.,[28] as follows:

(1) Is there prima facie evidence showing that the said shares are ill-gotten and thus belong to the State?
(2) Is there an imminent danger of dissipation, thus necessitating their continued sequestration and voting by the PCGG, while the main issue
is pending with the Sandiganbayan?

Sequestered Shares Acquired with Public Funds Are an Exception

From the foregoing general principle, the Court in Baseco v. PCGG[29] (hereinafter Baseco) and Cojuangco Jr. v. Roxas[30] (Cojuangco-
Roxas) has provided two clear public character exceptions under which the government is granted the authority to vote the shares:
(1) Where government shares are taken over by private persons or entities who/which registered them in their own names, and
(2) Where the capitalization or shares that were acquired with public funds somehow landed in private hands.
The exceptions are based on the common-sense principle that legal fiction must yield to truth; that public property registered in the names
of non-owners is affected with trust relations; and that the prima facie beneficial owner should be given the privilege of enjoying the rights flowing
from the prima facie fact of ownership.
In Baseco, a private corporation known as the Bataan Shipyard and Engineering Co. was placed under sequestration by the PCGG. Explained
the Court:

The facts show that the corporation known as BASECO was owned and controlled by President Marcos during his administration, through
nominees, by taking undue advantage of his public office and/or using his powers, authority, or influence, and that it was by and through the
same means, that BASECO had taken over the business and/or assets of the National Shipyard and Engineering Co., Inc., and other government-
owned or controlled entities. [31]

Given this factual background, the Court discussed PCGGs right over BASECO in the following manner:

Now, in the special instance of a business enterprise shown by evidence to have been taken over by the government of the Marcos
Administration or by entities or persons close to former President Marcos, the PCGG is given power and authority, as already adverted to, to
provisionally take (it) over in the public interest or to prevent * * (its) disposal or dissipation; and since the term is obviously employed in
reference to going concerns, or business enterprises in operation, something more than mere physical custody is connoted; the PCGG may in this
case exercise some measure of control in the operation, running, or management of the business itself. [32]

Citing an earlier Resolution, it ruled further:

Petitioner has failed to make out a case of grave abuse or excess of jurisdiction in respondents' calling and holding of a stockholders' meeting for
the election of directors as authorized by the Memorandum of the President * * (to the PCGG) dated June 26, 1986, particularly, where as in this
case, the government can, through its designated directors, properly exercise control and management over what appear to be properties and
assets owned and belonging to the government itself and over which the persons who appear in this case on behalf of BASECO have failed to
show any right or even any shareholding in said corporation. [33] (Italics supplied)

The Court granted PCGG the right to vote the sequestered shares because they appeared to be assets belonging to the government itself. The
Concurring Opinion of Justice Ameurfina A. Melencio-Herrera, in which she was joined by Justice Florentino P. Feliciano, explained this principle
as follows:

I have no objection to according the right to vote sequestered stock in case of a take-over of business actually belonging to the government
or whose capitalization comes from public funds but which, somehow, landed in the hands of private persons, as in the case of BASECO. To my
mind, however, caution and prudence should be exercised in the case of sequestered shares of an on-going private business enterprise, specially
the sensitive ones, since the true and real ownership of said shares is yet to be determined and proven more conclusively by the
Courts.[34] (Italics supplied)

The exception was cited again by the Court in Cojuangco-Roxas[35] in this wise:

The rule in this jurisdiction is, therefore, clear. The PCGG cannot perform acts of strict ownership of sequestered property. It is a mere
conservator. It may not vote the shares in a corporation and elect the members of the board of directors. The only conceivable exception is in a
case of a takeover of a business belonging to the government or whose capitalization comes from public funds, but which landed in private
hands as in BASECO.[36] (Italics supplied)

The public character test was reiterated in many subsequent cases; most recently, in Antiporda v. Sandiganbayan.[37] Expressly
citing Cojuangco-Roxas,[38] this Court said that in determining the issue of whether the PCGG should be allowed to vote sequestered shares, it was
crucial to find out first whether these were purchased with public funds, as follows:

It is thus important to determine first if the sequestered corporate shares came from public funds that landed in private hands. [39]

In short, when sequestered shares registered in the names of private individuals or entities are alleged to have been acquired with ill-gotten
wealth, then the two-tiered test is applied. However, when the sequestered shares in the name of private individuals or entities are shown, prima
facie, to have been (1) originally government shares, or (2) purchased with public funds or those affected with public interest, then the two-tiered
test does not apply. Rather, the public character exceptions in Baseco v. PCGG and Cojuangco Jr. v. Roxas prevail; that is, the government shall
vote the shares.

UCPB Shares Were Acquired With Coconut Levy Funds

In the present case before the Court, it is not disputed that the money used to purchase the sequestered UCPB shares came from the Coconut
Consumer Stabilization Fund (CCSF), otherwise known as the coconut levy funds.
This fact was plainly admitted by private respondents counsel, Atty. Teresita J. Herbosa, during the Oral Arguments held on April 17, 2001
in Baguio City, as follows:
Justice Panganiban:
In regard to the theory of the Solicitor General that the funds used to purchase [both] the original 28 million and the subsequent 80 million
came from the CCSF, Coconut Consumers Stabilization Fund, do you agree with that?
Atty. Herbosa:
Yes, Your Honor.
xxxxxxxxx
Justice Panganiban:
So it seems that the parties [have] agreed up to that point that the funds used to purchase 72% of the former First United Bank came from the
Coconut Consumer Stabilization Fund?
Atty. Herbosa:
Yes, Your Honor.[40]
Indeed in Cocofed v. PCGG,[41] this Court categorically declared that the UCPB was acquired with the use of the Coconut Consumers
Stabilization Fund in virtue of Presidential Decree No. 755, promulgated on July 29, 1975.

Coconut Levy Funds Are Affected With Public Interest

Having conclusively shown that the sequestered UCPB shares were purchased with coconut levies, we hold that these funds and shares are,
at the very least, affected with public interest.
The Resolution issued by the Court on February 16, 1993 in Republic v. Sandiganbayan[42] stated that coconut levy funds were clearly
affected with public interest; thus, herein private respondents even if they are the registered shareholders cannot be accorded the right to vote
them. We quote the said Resolution in part, as follows:

The coconut levy funds being clearly affected with public interest, it follows that the corporations formed and organized from those funds, and
all assets acquired therefrom should also be regarded as clearly affected with public interest. [43]

xxxxxxxxx

Assuming, however, for purposes of argument merely, the lifting of sequestration to be correct, may it also be assumed that the lifting of
sequestration removed the character of the coconut levy companies of being affected with public interest, so that they and their stock and assets
may now be considered to be of private ownership? May it be assumed that the lifting of sequestration operated to relieve the holders of stock in
the coconut levy companies affected with public interest of the obligation of proving how that stock had been legitimately transferred to private
ownership, or that those stockholders who had had some part in the collection, administration, or disposition of the coconut levy funds are now
deemed qualified to acquire said stock, and freed from any doubt or suspicion that they had taken advantage of their special or fiduciary relation
with the agencies in charge of the coconut levies and the funds thereby accumulated? The obvious answer to each of the questions is a negative
one. It seems plain that the lifting of sequestration has no relevance to the nature of the coconut levy companies or their stock or property, or to
the legality of the acquisition by private persons of their interest therein, or to the latters capacity or disqualification to acquire stock in the
companies or any property acquired from coconut levy funds.
This being so, the right of the [petitioners] to vote stock in their names at the meetings of the UCPB cannot be conceded at this time. That right
still has to be established by them before the Sandiganbayan. Until that is done, they cannot be deemed legitimate owners of UCPB stock and
cannot be accorded the right to vote them.[44] (Italics supplied)

It is however contended by respondents that this Resolution was in the nature of a temporary restraining order. As such, it was supposedly
interlocutory in character and became functus oficio when this Court decided GR No. 96073 on January 23, 1995.
This argument is aptly answered by petitioner in its Memorandum, which we quote:

The ruling made in the Resolution dated 16 February 1993 confirming the public nature of the coconut levy funds and denying claimants their
purported right to vote is an affirmation of doctrines laid down in the cases of COCOFED v. PCGG supra, Baseco v. PCGG, supra,
and Cojuangco v. Roxas, supra. Therefore it is of no moment that the Resolution dated 16 February 1993 has not been ratified. Its
jurisprudential bases remain. [45] (Italics supplied)

Granting arguendo that the Resolution is interlocutory, the truth remains: the coconut levy funds are still clearly affected with public
interest. That was the truth in 1989 as quoted by this Court in its February 16, 1993 Resolution, and so it is today. Said the Court in 1989:

The utilization and proper management of the coconut levy funds, raised as they were by the States police and taxing powers, are certainly the
concern of the Government. It cannot be denied that it was the welfare of the entire nation that provided the prime moving factor for the
imposition of the levy. It cannot be denied that the coconut industry is one of the major industries supporting the national economy. It is,
therefore, the States concern to make it a strong and secure source not only of the livelihood of a significant segment of the population but also
of export earnings the sustained growth of which is one of the imperatives of economic stability. The coconut levy funds are clearly affected with
public interest. Until it is demonstrated satisfactorily that they have legitimately become private funds, they must prima facie and by reason of
the circumstances in which they were raised and accumulated be accounted subject to the measures prescribed in E.O. Nos. 1, 2, and 14 to
prevent their concealment, dissipation, etc., which measures include the sequestration and other orders of the PCGG complained of.[46] (Italics
supplied)

To repeat, the foregoing juridical situation has not changed. It is still the truth today: the coconut levy funds are clearly affected with public
interest. Private respondents have not demonstrated satisfactorily that they have legitimately become private funds.
If private respondents really and sincerely believed that the final Decision of the Court in Republic v. Sandiganbayan (GR No. 96073,
promulgated on January 23, 1995) granted them the right to vote, why did they wait for the lapse of six long years before definit ively asserting it
(1) through their letter dated February 13, 2001, addressed to the UCPB Board of Directors, demanding the holding of a shareholders meeting on
March 6, 2001; and (2) through their Omnibus Motion dated February 23, 2001 filed in the court a quo, seeking to enjoin PCGG from voting the
subject sequestered shares during the said stockholders meeting? Certainly, if they even half believed their submission now -- that they already
had such right in 1995 -- why are they suddenly and imperiously claiming it only now?
It should be stressed at this point that the assailed Sandiganbayan Order dated February 28, 2001 -- allowing private respondents to vote the
sequestered shares -- is not based on any finding that the coconut levies and the shares have legitimately become private funds. Neither is it based
on the alleged lifting of the TRO issued by this Court on February 16, 1993. Rather, it is anchored on the grossly mistaken application of the two-
tiered test mentioned earlier in this Decision.
To stress, the two-tiered test is applied only when the sequestered asset in the hands of a private person is alleged to have been acquired with
ill-gotten wealth. Hence, in PCGG v. Cojuangco,[47] we allowed Eduardo Cojuangco Jr. to vote the sequestered shares of the San Miguel
Corporation (SMC) registered in his name but alleged to have been acquired with ill-gotten wealth. We did so on his representation that he had
acquired them with borrowed funds and upon failure of the PCGG to satisfy the two-tiered test. This test was, however, not applied to sequestered
SMC shares that were purchased with coco levy funds.
In the present case, the sequestered UCPB shares are confirmed to have been acquired with coco levies, not with alleged ill -gotten
wealth. Hence, by parity of reasoning, the right to vote them is not subject to the two-tiered test but to the public character of their acquisition,
which per Antiporda v. Sandiganbayan cited earlier, must first be determined.

Coconut Levy Funds Are Prima Facie Public Funds

To avoid misunderstanding and confusion, this Court will even be more categorical and positive than its earlier pronouncements: the coconut
levy funds are not only affected with public interest; they are, in fact, prima facie public funds.
Public funds are those moneys belonging to the State or to any political subdivision of the State; more specifically, taxes, customs duties and
moneys raised by operation of law for the support of the government or for the discharge of its obligations. [48] Undeniably, coconut levy funds
satisfy this general definition of public funds, because of the following reasons:
1. Coconut levy funds are raised with the use of the police and taxing powers of the State.
2. They are levies imposed by the State for the benefit of the coconut industry and its farmers.
3. Respondents have judicially admitted that the sequestered shares were purchased with public funds.
4. The Commission on Audit (COA) reviews the use of coconut levy funds.
5. The Bureau of Internal Revenue (BIR), with the acquiescence of private respondents, has treated them as public funds.
6. The very laws governing coconut levies recognize their public character.
 We shall now discuss each of the foregoing reasons, any one of which is enough to show their public character.

1. Coconut Levy Funds Are Raised Through the States Police and Taxing Powers.

Indeed, coconut levy funds partake of the nature of taxes which, in general, are enforced proportional contributions from persons and
properties, exacted by the State by virtue of its sovereignty for the support of government and for all public needs. [49]
Based on this definition, a tax has three elements, namely: a) it is an enforced proportional contribution from persons and properties; b) it is
imposed by the State by virtue of its sovereignty; and c) it is levied for the support of the government. The coconut levy funds fall squarely into
these elements for the following reasons:
(a) They were generated by virtue of statutory enactments imposed on the coconut farmers requiring the payment of prescribed
amounts. Thus, PD No. 276, which created the Coconut Consumer Stabilization Fund (CCSF), mandated the following:

a. A levy, initially, of P15.00 per 100 kilograms of copra resecada or its equivalent in other coconut products, shall be imposed on every first
sale, in accordance with the mechanics established under RA 6260, effective at the start of business hours on August 10, 1973.

The proceeds from the levy shall be deposited with the Philippine National Bank or any other government bank to the account of the Coconut
Consumers Stabilization Fund, as a separate trust fund which shall not form part of the general fund of the government. [50]

The coco levies were further clarified in amendatory laws, specifically PD No. 961 [51] and PD No. 1468[52] -- in this wise:

The Authority (Philippine Coconut Authority) is hereby empowered to impose and collect a levy, to be known as the Coconut Consumers
Stabilization Fund Levy, on every one hundred kilos of copra resecada, or its equivalent in other coconut products delivered to, and/or purchased
by, copra exporters, oil millers, desiccators and other end-users of copra or its equivalent in other coconut products. The levy shall be paid by
such copra exporters, oil millers, desiccators and other end-users of copra or its equivalent in other coconut products under such rules and
regulations as the Authority may prescribe. Until otherwise prescribed by the Authority, the current levy being collected shall be continued. [53]

Like other tax measures, they were not voluntary payments or donations by the people. They were enforced contributions exacted on pain
of penal sanctions, as provided under PD No. 276:

3. Any person or firm who violates any provision of this Decree or the rules and regulations promulgated thereunder, shall, in addition to
penalties already prescribed under existing administrative and special law, pay a fine of not less than P2,500 or more than P10,000, or suffer
cancellation of licenses to operate, or both, at the discretion of the Court. [54]

Such penalties were later amended thus:

Whenever any person or entity willfully and deliberately violates any of the provisions of this Act, or any rule or regulation legally promulgated
hereunder by the Authority, the person or persons responsible for such violation shall be punished by a fine of not more than P20,000.00 and by
imprisonment of not more than five years. If the offender be a corporation, partnership or a juridical person, the penalty shall be imposed on the
officer or officers authorizing, permitting or tolerating the violation. Aliens found guilty of any offenses shall, after having served his sentence,
be immediately deported and, in the case of a naturalized citizen, his certificate of naturalization shall be cancelled. [55]

(b) The coconut levies were imposed pursuant to the laws enacted by the proper legislative authorities of the State. Indeed, the CCSF was
collected under PD No. 276, issued by former President Ferdinand E. Marcos who was then exercising legislative powers. [56]
(c) They were clearly imposed for a public purpose. There is absolutely no question that they were collected to advance the governments
avowed policy of protecting the coconut industry. This Court takes judicial notice of the fact that the coconut industry is one of the great economic
pillars of our nation, and coconuts and their byproducts occupy a leading position among the countrys export products; that it gives employment
to thousands of Filipinos; that it is a great source of the States wealth; and that it is one of the important sources of foreign exchange needed by
our country and, thus, pivotal in the plans of a government committed to a policy of currency stability.
Taxation is done not merely to raise revenues to support the government, but also to provide means for the rehabilitation and the stabilization
of a threatened industry, which is so affected with public interest as to be within the police power of the State, as held in Caltex Philippines v.
COA[57] and Osmea v. Orbos.[58]
Even if the money is allocated for a special purpose and raised by special means, it is still public in character. In the case before us, the funds
were even used to organize and finance State offices. In Cocofed v. PCGG,[59] the Court observed that certain agencies or enterprises were
organized and financed with revenues derived from coconut levies imposed under a succession of laws of the late dictatorship x x x with deposed
Ferdinand Marcos and his cronies as the suspected authors and chief beneficiaries of the resulting coconut industry monopoly. [60] The Court
continued: x x x. It cannot be denied that the coconut industry is one of the major industries supporting the national economy. It is, therefore, the
States concern to make it a strong and secure source not only of the livelihood of a significant segment of the population, but also of export earnings
the sustained growth of which is one of the imperatives of economic stability. x x x.[61]

2. Coconut Funds Are Levied for the Benefit of the Coconut Industry and Its Farmers.
 Just like the sugar levy funds, the coconut levy funds constitute state funds even though they may be held for a special public purpose.
In fact, Executive Order No. 481 dated May 1, 1998 specifically likens the coconut levy funds to the sugar levy funds, both being special
public funds acquired through the taxing and police powers of the State. The sugar levy funds, which are strikingly similar to the coconut
levies in their imposition and purpose, were declared public funds by this Court in Gaston v. Republic Planters Bank,[62] from which we quote:

The stabilization fees collected are in the nature of a tax which is within the power of the State to impose for the promotion of the sugar industry
(Lutz vs. Araneta, 98 Phil. 148). They constitute sugar liens (Sec. 7[b], P.D. No. 388). The collections made accrue to a Special Fund, a
Development and Stabilization Fund, almost identical to the Sugar Adjustment and Stabilization Fund created under Section 6 of
Commonwealth Act 567. The tax collected is not in a pure exercise of the taxing power. It is levied with a regulatory purpose, to provide means
for the stabilization of the sugar industry. The levy is primarily in the exercise of the police power of the State. (Lutz vs. Araneta, supra.).[63]

The Court further explained:[64]

The stabilization fees in question are levied by the State upon sugar millers, planters and producers for a special purpose that of financing the
growth and development of the sugar industry and all its components, stabilization of the domestic market including the foreign market. The fact
that the State has taken possession of moneys pursuant to law is sufficient to constitute them as state funds, even though they are held for a
special purpose (Lawrence v. American Surety Co., 263 Mich 586. 294 ALR 535, cited in 42 Am. Jur., Sec. 2., p. 718). Having been levied for a
special purpose, the revenues collected are to be treated as a special fund, to be, in the language of the statute, administered in trust for the
purpose intended. Once the purpose has been fulfilled or abandoned, the balance, if any, is to be transferred to the general funds of the
Government. That is the essence of the trust intended (see 1987 Constitution, Art. VI, Sec. 29[3], lifted from the 1935 Constitution, Article VI,
Sec. 23[1]. (Italics supplied)

The character of the Stabilization Fund as a special fund is emphasized by the fact that the funds are deposited in the Philippine National Bank
and not in the Philippine Treasury, moneys from which may be paid out only in pursuance of an appropriation made by law (1987 Constitution,
Article VI, Sec. 29[1], 1973 Constitution, Article VIII, Sec. 18[1]).

That the fees were collected from sugar producers, planters and millers, and that the funds were channeled to the purchase of shares of stock in
respondent Bank do not convert the funds into a trust fund for their benefit nor make them the beneficial owners of the shares so purchased. It is
but rational that the fees be collected from them since it is also they who are to be benefited from the expenditure of the funds derived from
it. The investment in shares of respondent Bank is not alien to the purpose intended because of the Banks character as a commodity bank for
sugar conceived for the industrys growth and development. Furthermore, of note is the fact that one-half (1/2) or P0.50 per picul, of the amount
levied under P.D. No. 388 is to be utilized for the payment of salaries and wages of personnel, fringe benefits and allowances of officers and
employees of PHILSUCOM thereby immediately negating the claim that the entire amount levied is in trust for sugar, producers, planters and
millers.

To rule in petitioners favor would contravene the general principle that revenues derived from taxes cannot be used for purely private purposes
or for the exclusive benefit of private persons. The Stabilization Fund is to be utilized for the benefit of the entire sugar industry, and all its
components, stabilization of the domestic market including the foreign market, the industry being of vital importance to the countrys economy
and to national interest.

In the same manner, this Court has also ruled that the oil stabilization funds were public in character and subject to audit by COA. It ruled
in this wise:

Hence, it seems clear that while the funds collected may be referred to as taxes, they are exacted in the exercise of the police power of the
State. Moreover, that the OPSF is a special fund is plain from the special treatment given it by E.O. 137. It is segregated from the general fund;
and while it is placed in what the law refers to as a trust liability account, the fund nonetheless remains subject to the scrutiny and review of the
COA. The Court is satisfied that these measures comply with the constitutional description of a special fund. Indeed, the practice is not without
precedent.[65]

In his Concurring Opinion in Kilosbayan v. Guingona,[66] Justice Florentino P. Feliciano explained that the funds raised by the On-line
Lottery System were also public in nature. In his words:

x x x. In the case presently before the Court, the funds involved are clearly public in nature. The funds to be generated by the proposed lottery
are to be raised from the population at large. Should the proposed operation be as successful as its proponents project, those funds will come
from well-nigh every town and barrio of Luzon. The funds here involved are public in another very real sense: they will belong to the PCSO, a
government owned or controlled corporation and an instrumentality of the government and are destined for utilization in social development
projects which, at least in principle, are designed to benefit the general public. x x x. The interest of a private citizen in seeing to it that public
funds, from whatever source they may have been derived, go only to the uses directed and permitted by law is as real and personal and
substantial as the interest of a private taxpayer in seeing to it that tax monies are not intercepted on their way to the public treasury or otherwise
diverted from uses prescribed or allowed by law. It is also pertinent to note that the more successful the government is in raising revenues by
non-traditional methods such as PAGCOR operations and privatization measures, the lesser will be the pressure upon the traditional sources of
public revenues, i.e., the pocket books of individual taxpayers and importers. [67]

Thus, the coconut levy funds -- like the sugar levy and the oil stabilization funds, as well as the monies generated by the On-line Lottery
System -- are funds exacted by the State. Being enforced contributions, they are prima facie public funds.

3. Respondents Judicially Admit That the Levies Are Government Funds.

 Equally important as the fact that the coconut levy funds were raised through the taxing and police powers of the State is respondents
effective judicial admission that these levies are government funds. As shown by the attachments to their pleadings, [68] respondents concede that
the Coconut Consumers Stabilization Fund (CCSF) and the Coconut Investment Development Fund constitute government funds x x x for the
benefit of coconut farmers.

Collections on both levies constitute government funds. However, unlike other taxes that the Government levies and collects such as income tax,
tariff and customs duties, etc., the collections on the CCSF and CIDF are, by express provision of the laws imposing them, for a definite
purpose, not just for any governmental purpose. As stated above part of the collections on the CCSF levy should be spent for the benefit of the
coconut farmers. And in respect of the collections on the CIDF levy, P.D. 582 mandatorily requires that the same should be spent exclusively for
the establishment, operation and maintenance of a hybrid coconut seed garden and the distribution, for free, to the coconut farmers of the hybrid
coconut seednuts produced from that seed garden.

On the other hand, the laws which impose special levies on specific industries, for example on the mining industry, sugar industry, timber
industry, etc., do not, by their terms, expressly require that the collections on those levies be spent exclusively for the benefit of the industry
concerned. And if the enabling law thus so provide, the fact remains that the governmental agency entrusted with the duty of implementing the
purpose for which the levy is imposed is vested with the discretionary power to determine when and how the collections should be
appropriated.[69]

4. The COA Audit Shows the Public Nature of the Funds.

Under COA Office Order No. 86-9470 dated April 15, 1986,[70] the COA reviewed the expenditure and use of the coconut levies allocated
for the acquisition of the UCPB. The audit was aimed at ascertaining whether these were utilized for the purpose for which they had been
intended.[71] Under the 1987 Constitution, the powers of the COA are as follows:

The Commission on Audit shall have the power, authority, and duty to examine, audit, and settle all accounts pertaining to the revenue and
receipts of, and expenditures or uses of funds and property, owned or held in trust by, or pertaining to, the Government, or any of its
subdivisions, agencies, or instrumentalities x x x. [72]

Because these funds have been subjected to COA audit, there can be no other conclusion than that they are prima facie public in character.

5. The BIR Has Pronounced That the Coconut Levy Funds Are Taxes.

In response to a query posed by the administrator of the Philippine Coconut Authority regarding the character of the coconut levy funds, the
Bureau of Internal Revenue has affirmed that these funds are public in character. It held as follows: [T]he coconut levy is not a public trust fund
for the benefit of the coconut farmers, but is in the nature of a tax and, therefore, x x x public funds that are subject to government administration
and disposition.[73]
Furthermore, the executive branch treats the coconut levies as public funds. Thus, Executive Order No. 277, issued on September 24, 1995,
directed the mode of treatment, utilization, administration and management of the coconut levy funds. It provided as follows:

(a) The coconut levy funds, which include all income, interests, proceeds or profits derived therefrom, as well as all assets, properties and shares
of stocks procured or obtained with the use of such funds, shall be treated, utilized, administered and managed as public funds consistent with
the uses and purposes under the laws which constituted them and the development priorities of the government, including the governments
coconut productivity, rehabilitation, research extension, farmers organizations, and market promotions programs, which are designed to advance
the development of the coconut industry and the welfare of the coconut farmers. [74] (Italics supplied)

Doctrinally, acts of the executive branch are prima facie valid and binding, unless declared unconstitutional or contrary to law.

6. Laws Governing Coconut Levies Recognize Their Public Nature.

Finally and tellingly, the very laws governing the coconut levies recognize their public character. Thus, the third Whereas clause of PD No.
276 treats them as special funds for a specific public purpose. Furthermore, PD No. 711 transferred to the general funds of the State all existing
special and fiduciary funds including the CCSF. On the other hand, PD No. 1234 specifically declared the CCSF as a special fund for a special
purpose, which should be treated as a special account in the National Treasury.
Moreover, even President Marcos himself, as the sole legislative/executive authority during the martial law years, struck off the phrase which
is a private fund of the coconut farmers from the original copy of Executive Order No. 504 dated May 31, 1978, and we quote:

WHEREAS, by means of the Coconut Consumers Stabilization Fund (CCSF), which is the private fund of the coconut farmers (deleted),
essential coconut-based products are made available to household consumers at socialized prices. (Emphasis supplied)
 The phrase in bold face -- which is the private fund of the coconut farmers -- was crossed out and duly initialed by its author, former
President Marcos. This deletion, clearly visible in Attachment C of petitioners Memorandum, [75] was a categorical legislative intent to regard the
CCSF as public, not private, funds.

Having Been Acquired With Public Funds, UCPB Shares Belong, Prima Facie, to the Government

Having shown that the coconut levy funds are not only affected with public interest, but are in fact prima facie public funds, this Court
believes that the government should be allowed to vote the questioned shares, because they belong to it as the prima facie beneficial and true
owner.
As stated at the beginning, voting is an act of dominion that should be exercised by the share owner. One of the recognized rights of an
owner is the right to vote at meetings of the corporation. The right to vote is classified as the right to control. [76] Voting rights may be for the
purpose of, among others, electing or removing directors, amending a charter, or making or amending bylaws.[77] Because the subject UCPB shares
were acquired with government funds, the government becomes their prima facie beneficial and true owner.
Ownership includes the right to enjoy, dispose of, exclude and recover a thing without limitations other than those established by law or by
the owner.[78] Ownership has been aptly described as the most comprehensive of all real rights. [79] And the right to vote shares is a mere incident
of ownership. In the present case, the government has been shown to be the prima facie owner of the funds used to purchase the shares. Hence, it
should be allowed the rights and privileges flowing from such fact.
And paraphrasing Cocofed v. PCGG, already cited earlier, the Republic should continue to vote those shares until and unless private
respondents are able to demonstrate, in the main cases pending before the Sandiganbayan, that they [the sequestered UCPB shar es] have
legitimately become private.

Procedural and Incidental Issues: Grave Abuse of Discretion, Improper Arguments and Intervenors Relief

Procedurally, respondents argue that petitioner has failed to demonstrate that the Sandiganbayan committed grave abuse of discretion, a
demonstration required in every petition under Rule 65. [80]
We disagree. We hold that the Sandiganbayan gravely abused its discretion when it contravened the rulings of this Court
in Baseco and Cojuangco-Roxas -- thereby unlawfully, capriciously and arbitrarily depriving the government of its right to vote sequestered shares
purchased with coconut levy funds which are prima facie public funds.
Indeed, grave abuse of discretion may arise when a lower court or tribunal violates or contravenes the Constitution, the law or existing
jurisprudence. In one case,[81] this Court ruled that the lower courts resolution was tantamount to overruling a judicial pronouncement of the highest
Court x x x and unmistakably a very grave abuse of discretion. [82]

The Public Character of Shares Is a Valid Issue

Private respondents also contend that the public nature of the coconut levy funds was not raised as an issue before the Sandiganbayan. Hence,
it could not be taken up before this Court.
Again we disagree. By ruling that the two-tiered test should be applied in evaluating private respondents claim of exercising voting rights
over the sequestered shares, the Sandiganbayan effectively held that the subject assets were private in character. Thus, to meet this issue, the Office
of the Solicitor General countered that the shares were not private in character, and that quite the contrary, they were and are public in nature
because they were acquired with coco levy funds which are public in character. In short, the main issue of who may vote the shares cannot be
determined without passing upon the question of the public/private character of the shares and the funds used to acquire them. The latter issue,
although not specifically raised in the Court a quo, should still be resolved in order to fully adjudicate the main issue.
Indeed, this Court has the authority to waive the lack of proper assignment of errors if the unassigned errors closely relate to errors properly
pinpointed out or if the unassigned errors refer to matters upon which the determination of the questions raised by the errors properly assigned
depend.[83]
Therefore, where the issues already raised also rest on other issues not specifically presented as long as the latter issues bear relevance and
close relation to the former and as long as they arise from matters on record, the Court has the authority to include them in its discussion of the
controversy as well as to pass upon them. [84]

No Positive Relief For Intervenors

Intervenors anchor their interest in this case on an alleged right that they are trying to enforce in another Sandiganbayan case docketed as
SB Case No. 0187.[85] In that case, they seek the recovery of the subject UCPB shares from herein private respondents and the corporations
controlled by them. Therefore, the rights sought to be protected and the reliefs prayed for by intervenors are still being litigated in the said case. The
purported rights they are invoking are mere expectancies wholly dependent on the outcome of that case in the Sandiganbayan.
 Clearly, we cannot rule on intervenors alleged right to vote at this time and in this case. That right is dependent upon the Sandiganbayans
resolution of their action for the recovery of said sequestered shares. Given the patent fact that intervenors are not registered stockholders of UCPB
as of the moment, their asserted rights cannot be ruled upon in the present proceedings. Hence, no positive relief can be given them now, except
insofar as they join petitioner in barring private respondents from voting the subject shares.

Epilogue

In sum, we hold that the Sandiganbayan committed grave abuse of discretion in grossly contradicting and effectively reversing existing
jurisprudence, and in depriving the government of its right to vote the sequestered UCPB shares which are prima facie public in character.
In making this ruling, we are in no way preempting the proceedings the Sandiganbayan may conduct or the final judgment it may promulgate
in Civil Case Nos. 0033-A, 0033-B and 0033-F. Our determination here is merely prima facie, and should not bar the anti-graft court from making
a final ruling, after proper trial and hearing, on the issues and prayers in the said civil cases, particularly in reference to the ownership of the subject
shares.
We also lay down the caveat that, in declaring the coco levy funds to be prima facie public in character, we are not ruling in any final manner
on their classification -- whether they are general or trust or special funds -- since such classification is not at issue here. Suffice it to say that the
public nature of the coco levy funds is decreed by the Court only for the purpose of determining the right to vote the shares, pending the final
outcome of the said civil cases.
Neither are we resolving in the present case the question of whether the shares held by Respondent Cojuangco are, as he claims, the result
of private enterprise. This factual matter should also be taken up in the final decision in the cited cases that are pending in the court a quo. Again
suffice it to say that the only issue settled here is the right of PCGG to vote the sequestered shares, pending the final outcome of said cases.
This matter involving the coconut levy funds and the sequestered UCPB shares has been straddling the courts for about 15 years. What we
are discussing in the present Petition, we stress, is just an incident of the main cases which are pending in the anti-graft court -- the cases for the
reconveyance, reversion and restitution to the State of these UCPB shares.
The resolution of the main cases has indeed been long overdue. Every effort, both by the parties and the Sandiganbayan, should be exerted
to finally settle this controversy.
WHEREFORE, the Petition is hereby GRANTED and the assailed Order SET ASIDE. The PCGG shall continue voting the sequestered
shares until Sandiganbayan Civil Case Nos. 0033-A, 0033-B and 0033-F are finally and completely resolved. Furthermore, the Sandiganbayan
is ORDERED to decide with finality the aforesaid civil cases within a period of six (6) months from notice. It shall report to this Court on the
progress of the said cases every three (3) months, on pain of contempt. The Petition in Intervention is DISMISSED inasmuch as the reliefs prayed
for are not covered by the main issues in this case. No costs.

(SMART) and PILIPINO TELEPHONE CORPORATION (PILTEL), petitioners, vs. NATIONAL TELECOMMUNICATIONS
COMMISSION (NTC), respondent.
GLOBE TELECOM, INC. (GLOBE) and ISLA COMMUNICATIONS CO., INC. (ISLACOM), petitioners, vs. COURT OF APPEALS
(The Former 6th Division) and the NATIONAL TELECOMMUNICATIONS COMMISSION, respondents.
Pursuant to its rule-making and regulatory powers, the National Telecommunications Commission (NTC) issued on June 16,
2000 Memorandum Circular No. 13-6-2000, promulgating rules and regulations on the billing of telecommunications services. Among
its pertinent provisions are the following:

(1) The billing statements shall be received by the subscriber of the telephone service not later than 30 days from the end of each billing cycle. In
case the statement is received beyond this period, the subscriber shall have a specified grace period within which to pay the bill and the public
telecommunications entity (PTEs) shall not be allowed to disconnect the service within the grace period.

(2) There shall be no charge for calls that are diverted to a voice mailbox, voice prompt, recorded message or similar facility excluding the
customers own equipment.

(3) PTEs shall verify the identification and address of each purchaser of prepaid SIM cards. Prepaid call cards and SIM cards shall be valid for at
least 2 years from the date of first use. Holders of prepaid SIM cards shall be given 45 days from the date the prepaid SIM card is fully
consumed but not beyond 2 years and 45 days from date of first use to replenish the SIM card, otherwise the SIM card shall be rendered
invalid. The validity of an invalid SIM card, however, shall be installed upon request of the customer at no additional charge except the
presentation of a valid prepaid call card.

(4) Subscribers shall be updated of the remaining value of their cards before the start of every call using the cards.

(5) The unit of billing for the cellular mobile telephone service whether postpaid or prepaid shall be reduced from 1 minute per pulse to 6
seconds per pulse. The authorized rates per minute shall thus be divided by 10. [1]

The Memorandum Circular provided that it shall take effect 15 days after its publication in a newspaper of general circulation
and three certified true copies thereof furnished the UP Law Center. It was published in the newspaper, The Philippine Star, on June
22, 2000.[2]Meanwhile, the provisions of the Memorandum Circular pertaining to the sale and use of prepaid cards and the unit of
billing for cellular mobile telephone service took effect 90 days from the effectivity of the Memorandum Circular.
 On August 30, 2000, the NTC issued a Memorandum to all cellular mobile telephone service (CMTS) operators which contained
measures to minimize if not totally eliminate the incidence of stealing of cellular phone units. The Memorandum directed CMTS
operators to:
a. strictly comply with Section B(1) of MC 13-6-2000 requiring the presentation and verification of the identity and
addresses of prepaid SIM card customers;
b. require all your respective prepaid SIM cards dealers to comply with Section B(1) of MC 13-6-2000;
c. deny acceptance to your respective networks prepaid and/or postpaid customers using stolen cellphone units or
cellphone units registered to somebody other than the applicant when properly informed of all information relative to
the stolen cellphone units;
d. share all necessary information of stolen cellphone units to all other CMTS operators in order to prevent the use of
stolen cellphone units; and
e. require all your existing prepaid SIM card customers to register and present valid identification cards. [3]
This was followed by another Memorandum dated October 6, 2000 addressed to all public telecommunications entities, which
reads:

This is to remind you that the validity of all prepaid cards sold on 07 October 2000 and beyond shall be valid for at least two (2) years
from date of first use pursuant to MC 13-6-2000.

In addition, all CMTS operators are reminded that all SIM packs used by subscribers of prepaid cards sold on 07 October 2000 and
beyond shall be valid for at least two (2) years from date of first use. Also, the billing unit shall be on a six (6) seconds pulse effective 07
October 2000.

For strict compliance.[4]

On October 20, 2000, petitioners Isla Communications Co., Inc. and Pilipino Telephone Corporation filed against the National
Telecommunications Commission, Commissioner Joseph A. Santiago, Deputy Commissioner Aurelio M. Umali and Deputy
Commissioner Nestor C. Dacanay, an action for declaration of nullity of NTC Memorandum Circular No. 13-6-2000 (the Billing
Circular) and the NTC Memorandum dated October 6, 2000, with prayer for the issuance of a writ of preliminary injunction and
temporary restraining order. The complaint was docketed as Civil Case No. Q-00-42221 at the Regional Trial Court of Quezon City,
Branch 77.[5]
Petitioners Islacom and Piltel alleged, inter alia, that the NTC has no jurisdiction to regulate the sale of consumer goods such
as the prepaid call cards since such jurisdiction belongs to the Department of Trade and Industry under the Consumer Act of the
Philippines; that the Billing Circular is oppressive, confiscatory and violative of the constitutional prohibition against deprivation of
property without due process of law; that the Circular will result in the impairment of the viability of the prepaid cellular service by
unduly prolonging the validity and expiration of the prepaid SIM and call cards; and that the requirements of identification of prepaid
card buyers and call balance announcement are unreasonable. Hence, they prayed that the Billing Circular be declared null and
void ab initio.
Soon thereafter, petitioners Globe Telecom, Inc and Smart Communications, Inc. filed a joint Motion for Leave to Intervene and
to Admit Complaint-in-Intervention.[6] This was granted by the trial court.
On October 27, 2000, the trial court issued a temporary restraining order enjoining the NTC from implementing Memorandum
Circular No. 13-6-2000 and the Memorandum dated October 6, 2000.[7]
In the meantime, respondent NTC and its co-defendants filed a motion to dismiss the case on the ground of petitioners failure
to exhaust administrative remedies.
Subsequently, after hearing petitioners application for preliminary injunction as well as respondents motion to dismiss, the trial
court issued on November 20, 2000 an Order, the dispositive portion of which reads:

WHEREFORE, premises considered, the defendants motion to dismiss is hereby denied for lack of merit. The plaintiffs application for the
issuance of a writ of preliminary injunction is hereby granted. Accordingly, the defendants are hereby enjoined from implementing NTC
Memorandum Circular 13-6-2000 and the NTC Memorandum, dated October 6, 2000, pending the issuance and finality of the decision in this
case. The plaintiffs and intervenors are, however, required to file a bond in the sum of FIVE HUNDRED THOUSAND PESOS (P500,000.00),
Philippine currency.

SO ORDERED.[8]

Defendants filed a motion for reconsideration, which was denied in an Order dated February 1, 2001.[9]
Respondent NTC thus filed a special civil action for certiorari and prohibition with the Court of Appeals, which was docketed as
CA-G.R. SP. No. 64274. On October 9, 2001, a decision was rendered, the decretal portion of which reads:

WHEREFORE, premises considered, the instant petition for certiorari and prohibition is GRANTED, in that, the order of the court a
quo denying the petitioners motion to dismiss as well as the order of the court a quo granting the private respondents prayer for a writ of
preliminary injunction, and the writ of preliminary injunction issued thereby, are hereby ANNULLED and SET ASIDE. The private respondents
complaint and complaint-in-intervention below are hereby DISMISSED, without prejudice to the referral of the private respondents grievances
and disputes on the assailed issuances of the NTC with the said agency.
SO ORDERED.[10]

Petitioners motions for reconsideration were denied in a Resolution dated January 10, 2002 for lack of merit. [11]
Hence, the instant petition for review filed by Smart and Piltel, which was docketed as G.R. No. 151908, anchored on the
following grounds:
A.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE NATIONAL TELECOMMUNICATIONS COMMISSION (NTC) AND
NOT THE REGULAR COURTS HAS JURISDICTION OVER THE CASE.

B.

THE HONORABLE COURT OF APPEALS ALSO GRAVELY ERRED IN HOLDING THAT THE PRIVATE RESPONDENTS FAILED TO EXHAUST AN
AVAILABLE ADMINISTRATIVE REMEDY.

C.

THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE BILLING CIRCULAR ISSUED BY THE RESPONDENT NTC IS
UNCONSTITUTIONAL AND CONTRARY TO LAW AND PUBLIC POLICY.

D.

THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE PRIVATE RESPONDENTS FAILED TO SHOW THEIR CLEAR POSITIVE
RIGHT TO WARRANT THE ISSUANCE OF A WRIT OF PRELIMINARY INJUNCTION. [12]

Likewise, Globe and Islacom filed a petition for review, docketed as G.R. No. 152063, assigning the following errors:
1. THE HONORABLE COURT OF APPEALS SO GRAVELY ERRED BECAUSE THE DOCTRINES OF PRIMARY
JURISDICTION AND EXHAUSTION OF ADMINISTRATIVE REMEDIES DO NOT APPLY SINCE THE INSTANT
CASE IS FOR LEGAL NULLIFICATION (BECAUSE OF LEGAL INFIRMITIES AND VIOLATIONS OF LAW) OF A
PURELY ADMINISTRATIVE REGULATION PROMULGATED BY AN AGENCY IN THE EXERCISE OF ITS RULE
MAKING POWERS AND INVOLVES ONLY QUESTIONS OF LAW.
2. THE HONORABLE COURT OF APPEALS SO GRAVELY ERRED BECAUSE THE DOCTRINE ON EXHAUSTION OF
ADMINISTRATIVE REMEDIES DOES NOT APPLY WHEN THE QUESTIONS RAISED ARE PURELY LEGAL
QUESTIONS.
3. THE HONORABLE COURT OF APPEALS SO GRAVELY ERRED BECAUSE THE DOCTRINE OF EXHAUSTION OF
ADMINISTRATIVE REMEDIES DOES NOT APPLY WHERE THE ADMINISTRATIVE ACTION IS COMPLETE AND
EFFECTIVE, WHEN THERE IS NO OTHER REMEDY, AND THE PETITIONER STANDS TO SUFFER GRAVE AND
IRREPARABLE INJURY.
4. THE HONORABLE COURT OF APPEALS SO GRAVELY ERRED BECAUSE PETITIONERS IN FACT EXHAUSTED
ALL ADMINISTRATIVE REMEDIES AVAILABLE TO THEM.
5. THE HONORABLE COURT OF APPEALS SO GRAVELY ERRED IN ISSUING ITS QUESTIONED RULINGS IN THIS
CASE BECAUSE GLOBE AND ISLA HAVE A CLEAR RIGHT TO AN INJUNCTION. [13]
The two petitions were consolidated in a Resolution dated February 17, 2003. [14]
On March 24, 2003, the petitions were given due course and the parties were required to submit their respective memoranda. [15]
We find merit in the petitions.
Administrative agencies possess quasi-legislative or rule-making powers and quasi-judicial or administrative adjudicatory
powers. Quasi-legislative or rule-making power is the power to make rules and regulations which results in delegated legislation that
is within the confines of the granting statute and the doctrine of non-delegability and separability of powers.[16]
The rules and regulations that administrative agencies promulgate, which are the product of a delegated legislative power to
create new and additional legal provisions that have the effect of law, should be within the scope of the statutory authority granted by
the legislature to the administrative agency. It is required that the regulation be germane to the objects and purposes of the law, and
be not in contradiction to, but in conformity with, the standards prescribed by law. [17] They must conform to and be consistent with the
provisions of the enabling statute in order for such rule or regulation to be valid. Constitutional and statutory provisions control with
respect to what rules and regulations may be promulgated by an administrative body, as well as with respect to what fields are subject
to regulation by it. It may not make rules and regulations which are inconsistent with the provisions of the Constitution or a statute,
particularly the statute it is administering or which created it, or which are in derogation of, or defeat, the purpose of a statute. In case
of conflict between a statute and an administrative order, the former must prevail. [18]
Not to be confused with the quasi-legislative or rule-making power of an administrative agency is its quasi-judicial or
administrative adjudicatory power. This is the power to hear and determine questions of fact to which the legislative policy is to apply
and to decide in accordance with the standards laid down by the law itself in enforcing and administering the same law. The
administrative body exercises its quasi-judicial power when it performs in a judicial manner an act which is essentially of an executive
or administrative nature, where the power to act in such manner is incidental to or reasonably necessary for the performance of the
executive or administrative duty entrusted to it. In carrying out their quasi-judicial functions, the administrative officers or bodies are
required to investigate facts or ascertain the existence of facts, hold hearings, weigh evidence, and draw conclusions from them as
basis for their official action and exercise of discretion in a judicial nature.[19]
In questioning the validity or constitutionality of a rule or regulation issued by an administrative agency, a party need not exhaust
administrative remedies before going to court. This principle applies only where the act of the administrative agency concerned was
performed pursuant to its quasi-judicial function, and not when the assailed act pertained to its rule-making or quasi-legislative
power. In Association of Philippine Coconut Dessicators v. Philippine Coconut Authority,[20] it was held:
The rule of requiring exhaustion of administrative remedies before a party may seek judicial review, so strenuously urged by the Solicitor
General on behalf of respondent, has obviously no application here. The resolution in question was issued by the PCA in the exercise of its rule-
making or legislative power.However, only judicial review of decisions of administrative agencies made in the exercise of their quasi-judicial
function is subject to the exhaustion doctrine.

Even assuming arguendo that the principle of exhaustion of administrative remedies apply in this case, the records reveal that
petitioners sufficiently complied with this requirement. Even during the drafting and deliberation stages leading to the issuance of
Memorandum Circular No. 13-6-2000, petitioners were able to register their protests to the proposed billing guidelines. They
submitted their respective position papers setting forth their objections and submitting proposed schemes for the billing
circular.[21] After the same was issued, petitioners wrote successive letters dated July 3, 2000 [22] and July 5, 2000,[23] asking for the
suspension and reconsideration of the so-called Billing Circular. These letters were not acted upon until October 6, 2000, when
respondent NTC issued the second assailed Memorandum implementing certain provisions of the Billing Circular. This was taken by
petitioners as a clear denial of the requests contained in their previous letters, thus prompting them to seek judicial relief.
In like manner, the doctrine of primary jurisdiction applies only where the administrative agency exercises its quasi-judicial or
adjudicatory function. Thus, in cases involving specialized disputes, the practice has been to refer the same to an administrative
agency of special competence pursuant to the doctrine of primary jurisdiction. The courts will not determine a controversy involving
a question which is within the jurisdiction of the administrative tribunal prior to the resolution of that question by the administrative
tribunal, where the question demands the exercise of sound administrative discretion requiring the special knowledge, experience
and services of the administrative tribunal to determine technical and intricate matters of fact, and a uniformity of ruling is essential
to comply with the premises of the regulatory statute administered. The objective of the doctrine of primary jurisdiction is to guide a
court in determining whether it should refrain from exercising its jurisdiction until after an administrative agency has determined some
question or some aspect of some question arising in the proceeding before the court. It applies where the claim is originally cognizable
in the courts and comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory
scheme, has been placed within the special competence of an administrative body; in such case, the judicial process is suspended
pending referral of such issues to the administrative body for its view. [24]
However, where what is assailed is the validity or constitutionality of a rule or regulation issued by the administrative agency in
the performance of its quasi-legislative function, the regular courts have jurisdiction to pass upon the same. The determination of
whether a specific rule or set of rules issued by an administrative agency contravenes the law or the constitution is within the
jurisdiction of the regular courts. Indeed, the Constitution vests the power of judicial review or the power to declare a law, treaty,
international or executive agreement, presidential decree, order, instruction, ordinance, or regulation in the courts, including the
regional trial courts.[25] This is within the scope of judicial power, which includes the authority of the courts to determine in an
appropriate action the validity of the acts of the political departments. [26] Judicial power includes the duty of the courts of justice to
settle actual controversies involving rights which are legally demandable and enforceable, and to determine whether or not there has
been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government.[27]
In the case at bar, the issuance by the NTC of Memorandum Circular No. 13-6-2000 and its Memorandum dated October 6,
2000 was pursuant to its quasi-legislative or rule-making power. As such, petitioners were justified in invoking the judicial power of
the Regional Trial Court to assail the constitutionality and validity of the said issuances. In Drilon v. Lim,[28] it was held:

We stress at the outset that the lower court had jurisdiction to consider the constitutionality of Section 187, this authority being embraced in the
general definition of the judicial power to determine what are the valid and binding laws by the criterion of their conformity to the fundamental
law. Specifically, B.P. 129 vests in the regional trial courts jurisdiction over all civil cases in which the subject of the litigation is incapable of
pecuniary estimation, even as the accused in a criminal action has the right to question in his defense the constitutionality of a law he is charged
with violating and of the proceedings taken against him, particularly as they contravene the Bill of Rights. Moreover, Article X, Section 5(2), of
the Constitution vests in the Supreme Court appellate jurisdiction over final judgments and orders of lower courts in all cases in which the
constitutionality or validity of any treaty, international or executive agreement, law, presidential decree, proclamation, order, instruction,
ordinance, or regulation is in question. [29]

In their complaint before the Regional Trial Court, petitioners averred that the Circular contravened Civil Code provisions on
sales and violated the constitutional prohibition against the deprivation of property without due process of law. These are within the
competence of the trial judge. Contrary to the finding of the Court of Appeals, the issues raised in the complaint do not entail highly
technical matters. Rather, what is required of the judge who will resolve this issue is a basic familiarity with the workings of the cellular
telephone service, including prepaid SIM and call cards and this is judicially known to be within the knowledge of a good percentage
of our population and expertise in fundamental principles of civil law and the Constitution.
Hence, the Regional Trial Court has jurisdiction to hear and decide Civil Case No. Q-00-42221. The Court of Appeals erred in
setting aside the orders of the trial court and in dismissing the case.
WHEREFORE, in view of the foregoing, the consolidated petitions are GRANTED. The decision of the Court of Appeals in CA-
G.R. SP No. 64274 dated October 9, 2001 and its Resolution dated January 10, 2002 are REVERSED and SET ASIDE. The Order
dated November 20, 2000 of the Regional Trial Court of Quezon City, Branch 77, in Civil Case No. Q-00-42221 is REINSTATED. This
case is REMANDED to the court a quo for continuation of the proceedings
TATAD VS DEPARTMENT OF ENERGY
G.R. No. 124360 and 127867. November 5, 1997
FRANCISCO S. TATAD, petitioner, vs.
THE SECRETARY OF THE DEPARTMENT OF ENERGY AND THE SECRETARY OF THE DEPARTMENT OF
FINANCE, respondents.
Facts:
 The petitioner question the constitutionality of RA No. 8180 “An Act Deregulating the Downstream Oil Industry and For Other Purposes.”
The deregulation process has two phases: (a) the transition phase and the (b) full deregulation phase through EO No. 372.
The petitioner claims that Sec. 15 of RA No. 8180 constitutes an undue delegation of legislative power to the President and the Sec. of
Energy because it does not provide a determinate or determinable standard to guide the Executive Branch in determining when to implement the
full deregulation of the downstream oil industry, and the law does not provide any specific standard to determine when the prices of crude oil in
the world market are considered to be declining nor when the exchange rate of the peso to the US dollar is considered stable.

Issues:
1. Whether or not Sec 5(b) of R.A. 8180 violates the one title one subject requirement of the Constitution.
2. Whether or not Sec 15 of R.A. 8180 violates the constitutional prohibition on undue delegation of power.
3. Whether or not R.A. No. 8180 violates the constitutional prohibition against monopolies, combinations in restraint of trade and unfair
competition

Discussions:
1. The Court consistently ruled that the title need not mirror, fully index or catalogue all contents and minute details of a law. A law having
a single general subject indicated in the title may contain any number of provisions, no matter how diverse they may be, so long as they
are not inconsistent with or foreign to the general subject, and may be considered in furtherance of such subject by providing for the
method and means of carrying out the general subject.
2. Adopting the ruling from Eastern Shipping Lines, Inc. vs. POEA, the Court states that:
“There are two accepted tests to determine whether or not there is a valid delegation of legislative power, viz: the completeness test and the
sufficient standard test. Under the first test, the law must be complete in all its terms and conditions when it leaves the legislative such that when
it reaches the delegate the only thing he will have to do is to enforce it. Under the sufficient standard test, there must be adequate guidelines or
limitations in the law to map out the boundaries of the delegate’s authority and prevent the delegation from running riot. Both tests are intended
to prevent a total transference of legislative authority to the delegate, who is not allowed to step into the shoes of the legislature and exercise a
power essentially legislative.
3. A monopoly is a privilege or peculiar advantage vested in one or more persons or companies, consisting in the exclusive right or power
to carry on a particular business or trade, manufacture a particular article, or control the sale or the whole supply of a particular
commodity. It is a form of market structure in which one or only a few firms dominate the total sales of a product or service. On the
other hand, a combination in restraint of trade is an agreement or understanding between two or more persons, in the form of a contract,
trust, pool, holding company, or other form of association, for the purpose of unduly restricting competition, monopolizing trade and
commerce in a certain commodity, controlling its production, distribution and price, or otherwise interfering with freedom of trade
without statutory authority. Combination in restraint of trade refers to the means while monopoly refers to the end.
Rulings:
1. The Court does not concur with this contention. The Court has adopted a liberal construction of the one title – one subject rule. The
Court hold that section 5(b) providing for tariff differential is germane to the subject of R.A. No. 8180 which is the deregulation of the
downstream oil industry. The section is supposed to sway prospective investors to put up refineries in our country and make them rely
less on imported petroleum.[i][20] We shall, however, return to the validity of this provision when we examine its blocking effect on
new entrants to the oil market.
2. Sec 15 of R.A. 8180 can hurdle both the completeness test and the sufficient standard test. It will be noted that Congress expressly
provided in R.A. No. 8180 that full deregulation will start at the end of March 1997, regardless of the occurrence of any event. Full
deregulation at the end of March 1997 is mandatory and the Executive has no discretion to postpone it for any purported reason. Thus,
the law is complete on the question of the final date of full deregulation. The discretion given to the President is to advance the date of
full deregulation before the end of March 1997. Section 15 lays down the standard to guide the judgment of the President. He is to time
it as far as practicable when the prices of crude oil and petroleum products in the world market are declining and when the exchange rate
of the peso in relation to the US dollar is stable.
3. Section 19 of Article XII of the Constitution allegedly violated by the aforestated provisions of R.A. No. 8180 mandates: “The State
shall regulate or prohibit monopolies when the public interest so requires. No combinations in restraint of trade or unfair competition
shall be allowed.”
Eastern Shipping Lines v. POEA
166 SCRA 533 (1988)

o GENERAL RULE: Non-delegation of Legislative Power

o EXCEPTION: Subordinate Legislation
o Tests for Valid Delegation of Legislative Power
FACTS:

Vitaliano Saco, the Chief Officer of a ship, was killed in an accident in Tokyo, Japan. The widow filed a complaint for damages
against the Eastern Shipping Lines with the POEA, based on Memorandum Circular No. 2 issued by the latter which stipulated
 death benefits and burial expenses for the family of an overseas worker. Eastern Shipping Lines questioned the validity of the
memorandum circular. Nevertheless, the POEA assumed jurisdiction and decided the case.

ISSUE:

o W/N the issuance of Memorandum Circular No. 2 is a violation of non-delegation of powers

HELD:

SC held that there was valid delegation of powers.

In questioning the validity of the memorandum circular, Eastern Shipping Lines contended that POEA was given no authority to
promulgate the regulation, and even with such authorization, the regulation represents an exercise of legislative discretion which,
under the principle, is not subject to delegation.

GENERAL RULE: Non-delegation of powers; exception

It is true that legislative discretion as to the substantive contents of the law cannot be delegated. What can be delegated is the
discretion to determine how the law may be enforced, not what the law shall be. The ascertainment of the latter subject is a
prerogative of the legislature. This prerogative cannot be abdicated or surrendered by the legislature to the delegate.

Two Tests of Valid Delegation of Legislative Power

There are two accepted tests to determine whether or not there is a valid delegation of legislative power, viz, the completeness test
and the sufficient standard test. Under the first test, the law must be complete in all its terms and conditions when it leaves the
legislature such that when it reaches the delegate the only thing he will have to do is to enforce it. Under the sufficient standard
test, there must be adequate guidelines or stations in the law to map out the boundaries of the delegate’s authority and prevent the
delegation from running riot.

Both tests are intended to prevent a total transference of legislative authority to the delegate, who is not allowed to step into the
shoes of the legislature and exercise a power essentially legislative.

Xxx The delegation of legislative power has become the rule and its non-delegation the exception.

Rationale for Delegation of Legislative Power

The reason is the increasing complexity of the task of government and the growing inability of the legislature to cope directly with
the myriad problems demanding its attention. The growth of society has ramified its activities and created peculiar and
sophisticated problems that the legislature cannot be expected to reasonably comprehend. Specialization even in legislation has
become necessary. Too many of the problems attendant upon present-day undertakings, the legislature may not have the
competence to provide the required direct and efficacious, not to say, specific solutions. These solutions may, however, be
expected from its delegates, who are supposed to be experts in the particular fields.

Power of Subordinate Legislation

The reasons given above for the delegation of legislative powers in general are particularly applicable to administrative bodies. With
the proliferation of specialized activities and their attendant peculiar problems, the national legislature has found it more and more
necessary to entrust to administrative agencies the authority to issue rules to carry out the general provisions of the statute. This is
called the “power of subordinate legislation.”

With this power, administrative bodies may implement the broad policies laid down in statute by “filling in” the details which the
Congress may not have the opportunity or competence to provide. Memorandum Circular No. 2 is one such administrative
regulation.

THE PEOPLE OF THE PHILIPPINE ISLANDS and HONGKONG & SHANGHAI BANKING CORPORATION, petitioners,
vs.
JOSE O. VERA, Judge . of the Court of First Instance of Manila, and MARIANO CU UNJIENG, respondents.

Facts:

Mariano Cu Unjieng was convicted by the trial court in Manila. He filed for reconsideration and four motions for new trial but all were denied.
He then elevated to the Supreme Court and the Supreme Court remanded the appeal to the lower court for a new trial. While awaiting new trial,
he appealed for probation alleging that the he is innocent of the crime he was convicted of. The Judge of the Manila CFI directed the appeal to
the Insular Probation Office. The IPO denied the application. However, Judge Vera upon another request by petitioner allowed the petition to be
set for hearing. The City Prosecutor countered alleging that Vera has no power to place Cu Unjieng under probation because it is in violation of
Sec. 11 Act No. 4221 which provides that the act of Legislature granting provincial boards the power to provide a system of probation to
convicted person. Nowhere in the law is stated that the law is applicable to a city like Manila because it is only indicated therein that only
provinces are covered. And even if Manila is covered by the law it is unconstitutional because Sec 1 Art 3 of the Constitution provides equal
protection of laws. The said law provides absolute discretion to provincial boards and this also constitutes undue delegation of power. Further,
the said probation law may be an encroachment of the power of the executive to provide pardon because providing probation, in effect, is
granting freedom, as in pardon.
Issues:

1. Whether or not Act No. 4221 constituted an undue delegation of legislative power

2. Whether or not the said act denies the equal protection of the laws

Discussions:

1. An act of the legislature is incomplete and hence invalid if it does not lay down any rule or definite standard by which the administrative
officer or board may be guided in the exercise of the discretionary powers delegated to it. The probation Act does not, by the force of any
of its provisions, fix and impose upon the provincial boards any standard or guide in the exercise of their discretionary power. What is
granted, as mentioned by Justice Cardozo in the recent case of Schecter, supra, is a “roving commission” which enables the provincial
boards to exercise arbitrary discretion. By section 11 if the Act, the legislature does not seemingly on its own authority extend the benefits
of the Probation Act to the provinces but in reality leaves the entire matter for the various provincial boards to determine.
2. The equal protection of laws is a pledge of the protection of equal laws. The classification of equal protection, to be reasonable, must be
based on substantial distinctions which make real differences; it must be germane to the purposes of the law; it must not be limited to
existing conditions only, and must apply equally to each member of the class.

Rulings:

1. The Court concludes that section 11 of Act No. 4221 constitutes an improper and unlawful delegation of legislative authority to the
provincial boards and is, for this reason, unconstitutional and void. There is no set standard provided by Congress on how provincial boards
must act in carrying out a system of probation. The provincial boards are given absolute discretion which is violative of the constitution and
the doctrine of the non delegation of power. Further, it is a violation of equity so protected by the constitution. The challenged section of
Act No. 4221 in section 11 which reads as follows: This Act shall apply only in those provinces in which the respective provincial boards
have provided for the salary of a probation officer at rates not lower than those now provided for provincial fiscals. Said probation officer
shall be appointed by the Secretary of Justice and shall be subject to the direction of the Probation Office.

The provincial boards of the various provinces are to determine for themselves, whether the Probation Law shall apply to their provinces or not
at all. The applicability and application of the Probation Act are entirely placed in the hands of the provincial boards. If the provincial board does
not wish to have the Act applied in its province, all that it has to do is to decline to appropriate the needed amount for the salary of a probation
officer.

2. It is also contended that the Probation Act violates the provisions of our Bill of Rights which prohibits the denial to any person of the equal
protection of the laws. The resultant inequality may be said to flow from the unwarranted delegation of legislative power, although perhaps
this is not necessarily the result in every case. Adopting the example given by one of the counsel for the petitioners in the course of his oral
argument, one province may appropriate the necessary fund to defray the salary of a probation officer, while another province may refuse
or fail to do so. In such a case, the Probation Act would be in operation in the former province but not in the latter. This means that a person
otherwise coming within the purview of the law would be liable to enjoy the benefits of probation in one province while another person
similarly situated in another province would be denied those same benefits. This is obnoxious discrimination. Contrariwise, it is also
possible for all the provincial boards to appropriate the necessary funds for the salaries of the probation officers in their respective
provinces, in which case no inequality would result for the obvious reason that probation would be in operation in each and every province
by the affirmative action of appropriation by all the provincial boards.