Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-49705-09 February 8, 1979

TOMATIC ARATUC, SERGIO TOCAO, CISCOLARIO DIAZ, FRED TAMULA, MANGONTAWAR GURO and BONIFACIO
LEGASPI, petitioners,
vs.
The COMMISSION ON ELECTIONS, REGIONAL BOARD OF CANVASSERS for Region XII (Central Mindanao), ABDULLAH
DIMAPORO, JESUS AMPARO, ANACLETO BADOY, et al., respondents.

Nos. L-49717-21 February 8,1979.

LINANG MANDANGAN, petitioner,

vs.
THE COMMISSION ON ELECTIONS, THE REGIONAL BOARD OF CANVASSERS for Region XII, and ERNESTO
ROLDAN, respondents.

L-49705-09 — Lino M. Patajo for petitioners.

Estanislao A. Fernandez for private respondents.

L-49717-21 — Estanislao A. Fernandez for petitioner.

Lino M. Patajo for private respondent.

Office of the Solicitor General, for Public respondents.

BARREDO, J.:

Petition in G. R. Nos. L-49705-09 for certiorari with restraining order and preliminary injunction filed by six (6) independent candidates
for representatives to tile Interim Batasang Pambansa who had joined together under the banner of the Kunsensiya ng Bayan which,
however, was not registered as a political party or group under the 1976 Election Code, P.D. No. 1296, namely Tomatic Aratuc, Sorgio
Tocao, Ciscolario Diaz, Fred Tamula, Mangontawar Guro and Bonifacio Legaspi her referred to as petitioners, to review the decision of
the respondent Commission on Election (Comelec) resolving their appeal from the Of the respondent Regional Board of Canvasses for
Region XII regarding the canvass of the results of the election in said region for representatives to the I.B.P. held on April 7, 1978.
Similar petition in G.R. Nos. L49717-21, for certiorari with restraining order and preliminary injunction filed by Linang Mandangan, abo a
candidate for representative in the same election in that region, to review the decision of the Comelec declaring respondent Ernesto
Roldan as entitled to be proclaimed as one of the eight winners in said election.

The instant proceedings are sequels of Our decision in G.R. No. L- 48097, wherein Tomatic Aratuc et al. sought the suspension of the
canvass then being undertaken by respondent dent Board in Cotabato city and in which canvass, the returns in 1966 out of a total of
4,107 voting centers in the whole region had already been canvassed showing partial results as follows:

NAMES OF NO. OF
CANDIDATES VOTES

1. Roldan, 225,674
Ernesto (KB)

2. Valdez, 217,789
Estanislao (KBL)

3. Dimporo, 199,244
Abdullah (KBL)
4. Tocao, Sergio 199,062
(KB)

5. Badoy, 198,966
Anacleto (KBL)

6. Amparo, Jesus 184,764

(KBL)

7. 183,646
Pangandaman,
Sambolayan
(KBL)

8. Sinsuat, Datu 182,457

Blah (KBL)

9. Baga, Tomas 171,656

(KBL)

10. Aratuc, 165,795

Tomatic (KB)

11. Mandangan, 165,032

Linang(KB)

12. Diaz, 159,977

Ciscolario (KB)

13. Tamalu, Fred 153,734

(KB)

14. Legaspi 148,200

Bonifacio (KB)

15. Guro, 139,386

Mangontawar
(KB)

16. Loma, 107,455

Nemesio (KB)
 17. Macapeges, 101,350
Malamama
(Independent)

(Votes Of the independent candidates who actually were not in contention omitted)" (Page 6, Record, L-49705-09.)

A supervening panel headed by Commissioner of Elections, Hon- Venancio S. Duque, had conducted of the complaints of the petitioners
therein of alleged irregularities in the election records in all the voting centers in the whole province of Lanao del Sur, the whole City of
Marawi, eight (8) towns of Lanao del Norte, namely, Baloi, Karomatan, Matungao, Munai, Nunungan, Pantao Ragat, Tagoloan and
Tangcal, seven (7) towns in Maguindanao, namely, Barrira, Datu Piang, Dinaig, Matanog Parang, South Upi and Upi, ten (10) towns in
North Cotabato, namely, Carmen, Kabacan, Kidapwan, Magpet, Matalam Midsayap, Pigcawayan, Pikit, Pres. Roxas and Tulonan, and
eleven (11) towns in Sultan Kudarat, namely, Bagumbayan, Columbia Don Mariano Marcos, Esperanza, Isulan, Kalamansig, Lebak,
Lutayan, Palimbang, President Quirino and Tacurong, by reason for which, petitioners had asked that the returns from said voting
centers be excluded from the canvass. Before the start of the hearings, the canvass was suspended but after the supervisory panel
presented its report, on May 15, 1978, the Comelec lifted its order of suspension and directed the resumption of the canvass to be done
in Manila. This order was the one assailed in this Court. We issued a restraining order.

After hearing the parties, the Court allowed the resumption of the canvass but issued the following guidelines to be observed thereat:

1. That the resumption of said canvass shall be held in the Comelec main office in Manila starting not later than June
1, 1978;

2. That in preparation therefor, respondent Commission on Elections shall see to it that all the material election
paragraph corresponding to all the voting center involved in Election Nos. 78-8, 78-9, 78-10, 78-11 and 78-12 are
taken to its main office in Manila, more particularly, the ballot boxes, with the contents, used during the said elections,
the books of voters or records of voting and the lists or records of registered voters, on or before May 31, 1978;

3. That as soon as the corresponding records are available, petitioners and their counsel shall be allowed to examine
the same under such security measures as the respondent Board may determine, except the contents of the ballot
boxes which shall be opened only upon orders of either the respondent Board or respondent Commission, after the
need therefor has become evident, the purpose of such examination being to enable petitioners, and their counsel to
expeditiously determine which of them they would wish to be scrutinized and passed upon by the Board as supporting
their charges of election frauds and anomalies, petitioners and their counsel being admonished in this connection, that
no dilatory tactics should be in by them and that only such records substantial objections should be offered by them
for the scrutiny by the Board;

4. That none of the election returns reffered to in the petition herein shall be canvassed without first giving the herein
petitioners ample opportunity to make their specific objections thereto, if they have any, and to show sufficient basis
for the rejection of any of the returns, and, in this connection, the respondent Regional Board of Canvassers should
give due consideration to the points raised in the memorandum filed by said petitioners with the Commission on
Election in the above cases dated April 26, 1978;

5. That should it appear to the board upon summary scrutiny of the records to be offered by petitioners indication that
in the voting center actually held and/or that election returns were prepared either before the day of the election
returns or at any other time, without regard thereto or that there has been massive substitution of voters, or that ballots
and/or returns were prepared by the same groups of persons or individuals or outside of the voting centers, the Board
should exclude the corresponding returns from the canvass;

6. That appeals to the commission on Election of the Board may be made only after all the returns in question in all
the above, the above five cases shall have been passed upon by the Board and, accordingly, no proclamation made
until after the Commission shall have finally resolved the appeal without prejudice to recourse to this court, if
warranted as provided by the Code and the Constitution, giving the parties reasonable time therefor;

7. That the copies of the election returns found in the corresponding ballot boxes shall be the one used in the canvass;

8. That the canvass shall be conducted with utmost dispatch, to the end that a proclamation, if feasible, may be made
not later than June 10, 1978; thus, the canvass may be terminated as soon as it is evident that the possible number of
votes in the still uncanvassed returns with no longer affect the general results of the elections here in controversy;

9. That respondent Commission shall promulgate such other directive not inconsistent with this resolution y necessary
to expedite the proceedings herein contemplated and to accomplish the purposes herein intended. (Pp. 8-9, Record.

On June 1, 1978, upon proper motion, said guidelines were modified:

... in the sense that the ballot boxes for the voting centers just referred to need not be taken to Manila, EXCEPT those
of the particular voting centers as to which the petitioners have the right to demand that the corresponding ballot
boxes be opened in order that the votes therein may be counted because said ballots unlike the election returns, have
not been tampered with or substituted, which instances the results of the counting shall be specified and made known
by petitioners to the Regional Board of Canvassers not later than June 3, 1978; it being understood, that for the
 purposes of the canvass, the petitioners shall not be allowed to invoke any objection not already alleged in or
comprehend within the allegations in their complaint in the election cases above- mentioned. (Page 8, Id.)

Thus respondent Board proceeded with the canvass, with the herein petitioners presenting objections, most of them supported by the
report of handwriting and finger print experts who had examined the voting records and lists of voters in 878 voting centers, out of 2,700
which they specified in their complaints or petitions in Election Cases 78-8, 78-9, 78-10, 78-11 and 7812 in the Comelec. In regard to
501 voting centers, the records cf. which, consisting of the voters lists and voting records were not available- and could not be brought to
Manila, petitions asked that the results therein be completely excluded from the canvass. On July 11, 1978, respondent Board
terminated its canvass and declared the result of the voting to be as follows:

NAME OF VOT
CANDIDATE ES
OBTA
IN

VALDEZ, 436,0
Estanislao 69

DIMAPORO, 429,3
Abdullah 51

PANGANDAM 406,1
AN, 06
Sambolayan

SINSUAT, Blah 403,4

45

AMPARO, 399,9
Jesus 97

MANDANGAN 387,0
, Linang 25

BAGA, Tomas 386,3

93

BADOY,Anacle 374,9
to 33

ROLDAN, 275,1
Ernesto 41

TOCAO, 239,9
Sergio 14
 ARATUC, 205,8
Tomatic 29

GURO, 190,4
Mangontawar 89

DIAZ, 190,0
Ciscolario 77

TAMULA, Fred 180,2

80

LEGASPI, 174,3
Bonifacio 96

MACAPEGES, 160,2
Malamana 71

(Pp. 11-12,
Record.)

Without loss of time, the petitioners brought the resolution of respondent Board to the Comelec. Hearing was held on April 25, 1978,
after which , the case was declared submitted for decision. However, on August 30,1978, the Comelec issued a resolution stating inter
alia that :

In order to enable the Commission to decide the appeal properly :

a. It will have to go deeper into the examination of the voting records and registration records and in the case of voting
centers whose voting and registration records which have not yet been submitted for the Commission to decide to
open the ballot boxes; and

b. To interview and get statements under oath of impartial and disinterested persons from the area to determine
whether actual voting took place on April 7, 1978, as well as those of the military authorities in the areas affects (Page
12). Record, L-49705-09 .)

On December 11, 1978, the Comelec required the parties "to file their respective written comments on the reports they shall periodically
receive from the NBI-Comelec team of finger-print and signature experts within the inextendible period of seven (7) days from their
receipt thereof". According to counsel for Aratuc, et al., "Petitioners submitted their various comments on the report 4, the principal gist
of which was that it would appear uniformly in all the reports submitted by the Comelec-NBI experts that the registered voters were not
the ones who voted as shown by the fact that the thumbprints appearing in Form 1 were different from the thumbprints of the voters in
Form 5. " But the Comelec denied a motion of petitioners asking that the ballot boxes corresponding to the voting centers the record of
which are not available be opened and that a date be set when the statements of witnesses referred to in the August 30, 1978 resolution
would be taken, on the ground that in its opinion, it was no longer necessary to proceed with such opening of ballot boxes and taking of
statements.

For his part, counsel for petitioner M in G.R. No. L-49717-21 filed with Comelec on December 19,1978 a Memorandum. To quote from
the petition:

On December 19, 1978, the KBL, through counsel, filed a Memorandum for the Kilusang Bagong Lipunan (KBL)
Candidates on the Comelec's Resolution of December 11, 1978, a xerox copy of which is attached hereto and made a
part hereof as Annex 2, wherein they discussed the following topics: (I) Brief History of the President Case; (II)
Summary of Our Position and Submission Before the Honorable commission; and (III) KBL's Appeal Ad Cautelam.
And the fourth topic, because of its relevance to the case now before this Honorable Court, we hereby quote for ready
reference:
 IV

OUR POSITION WITH RESPECT TO THE

ESOLUTION OF THE HONORABLE

COMMISSION OF DECEMBER 11, 1978

We respectfully submit that the Resolution of this case by this Honorable Commission should be limited to the
precincts and municipalities involved in the KB'S Petitions in Cases Nos. 78-8 to 78-12, on which evidence had been
submitted by the parties, and on which the KB submitted the reports of their handwriting-print. Furthermore, it should
be limited by the appeal of the KB. For under the Supreme Court Resolution of May 23, 1978, original jurisdiction was
given to the Board, with appeal to this Honorable Commission-Considerations of other matters beyond these would
be, in our humble opinion, without jurisdiction.

For the present, we beg to inform this Honorable Commission that we stand by the reports and findings of the
COMELEC/NBI experts as submitted by them to the Regional Board of Canvassers and as confirmed by the said
Regional Board of Canvassers in its Resolution of July 11, 1978, giving the 8 KBL candidates the majorities we have
already above mentioned. The Board did more than make a summary scrutiny of the records' required by the
Supreme Court Resolution, Guideline No. 5, of May 23, 1978. Hence, if for lack of material time we cannot file any
Memorandum within the non-extendible period of seven (7) days, we would just stand by said COMELEC/NBI experts'
reports to the Regional Board, as confirmed by the Board (subject to our appeal ad cautelam).

The COMELEC sent to the parties copies of the reports of the NBI-COMELEC experts. For lack of material time due
to the voluminous reports and number of voting centers involved, the Christmas holidays, and our impression that the
COMELEC will exercise only its appellate jurisdiction, specially as per resolution of this Honorable Court of May 23,
1978 (in G.R. No. L-48097), we, the KBL, did not comment any more on said reports. (Pp. 5-6, Record, L-49717-21.)

On January 13, 1979, the Comelec rendered its resolution being assailed in these cases, declaring the final result of the canvass to be
as follows:

CANDIDAT VO
ES TE
S

VALDEZ, 31
Estanislao 9,5
14

DIMAPOR 28
O, Abdullah 9.7
51

AMPARO, 28
Jesus 6,1
80

BADOY, 28
Anacleto 5,9
85

BAGA, 27
Tomas 1,4
73

PANGAND 27
AMAN, 1,3
Sambolaya 93
n

SINSUAT, 26
Blah 9,9
05

ROLDAN, 26
Ernesto 8,2
87

MANDANG 25
AN, Linang 1,2
26

TACAO, 22
Sergio 9,1
24

DIAZ, 18
Ciscolario 7,9
86

ARATUC, 18
Tomatic 3,3
16

LEGASPI, 17
Bonifacio 8,5
64

TAMULA, 17
Fred 7,2
70

GURO, 16
Mangontaw 3,4
ar 49

LOMA, 12
Nemesio 9,4
50
 (Page 14,
Record, L-
49705-09.)

It is alleged in the Aratuc petition that:

The Comelec committee grave abuse of dicretion, amounting to lack of jurisdiction:

1. In not pursuing further the examination of the registration records and voting records from the other voting centers
questioned by petitioners after it found proof of massive substitute voting in all of the voting records and registration
records examined by Comelec and NBI experts;

2. In including in the canvass returns from the voting centers whose book of voters and voting records could not be
recovered by the Commission in spite of its repeated efforts to retrieve said records;

3. In not excluding from the canvass returns from voting centers showing a very high percentage of voting and in not
considering that high percentage of voting, coupled with massive substitution of voters is proof of manufacturing of
election returns;

4. In denying petitioners' petition for the opening of the ballot boxes from voting centers whose records are not
available for examination to determine whether or not there had been voting in said voting centers;

5. In not Identifying the ballot boxes that had no padlocks and especially those that were found to be empty while they
were shipped to Manila pursuant to the directive of the Commission in compliance with the guidelines of this
Honorable Court;

6. In not excluding from the canvass returns where the results of examination of the voting records and registration
records show that the thumbprints of the voters in CE Form 5 did not correspond to those of the registered voters as
shown in CE Form 1;

7. In giving more credence to the affidavits of chairmen and members of the voting centers, municipal treasurers and
other election officials in the voting centers where irregularities had been committed and not giving credence to the
affidavits of watchers of petitioners;

8. In not including among those questioned before the Board by petitioners those included among the returns
questioned by them in their Memorandum filed with the Commission on April 26, 1978, which Memorandum was
attached as Annex 'I' to their petition filed with this Honorable Court G.R. No. L-48097 and which the Supreme Court
said in its Guidelines should be considered by the Board in the course of the canvass (Guidelines No. 4). (Pp. 15-16,
Record, Id.)

On the other hand, the Mandangan petition submits that the Comelec comitted the following errors:

1. In erroneously applying the earlier case of Diaz vs. Commission on Elections (November 29, 1971; 42 SCRA 426),
and particularly the highly restrictive criterion that when the votes obtained by the candidates with the highest number
of votes exceed the total number of highest possible valid votes, the COMELEC ruled to exclude from the canvass the
election return reflecting such rests, under which the COMELEC excluded 1,004 election returns, involving around
100,000 votes, 95 % of which are for KBL candidates, particularly the petitioner Linang Mandangan, and which rule is
so patently unfair, unjust and oppressive.

2. In not holding that the real doctrine in the Diaz Case is not the total exclusion of election returns simply because the
total number of votes exceed the total number of highest possible valid votes, but 'even if all the votes cast by persons
Identified as registered voters were added to the votes cast by persons who can not be definitely ascertained as
registered or not, and granting, ad arguendo, that all of them voted for respondent Daoas, still the resulting total is
much below the number of votes credited to the latter in returns for Sagada, 'and that 'of the 2,188 ballots cast in
Sagada, nearly one-half (1,012) were cast by persons definitely Identified as not registered therein or still more than
40 % of substitute voting which was the rule followed in the later case of Bashier/Basman (Diaz Case, November
19,1971,42 SCRA 426,432).

3. In not applying the rule and formula in the later case of Bashier and Basman vs. Commission on Election (February
24, 1972, 43 SCRA 238) which was the one followed by the Regional Board of Canvassers, to wit:

In Basman vs Comelec (L-33728, Feb. 24, 1972) the Supreme Court upheld the Supreme Court
upheld the ruling of the Commission setting the standard of 40 % excess votes to justify the
exclusion of election returns. In line with the above ruling, the Board of Canvassers may likewise set
aside election returns with 40 % substitute votes. Likewise, where excess voting occured and the
excess was such as to destroy the presumption of innocent mistake, the returns was excluded.

(COMELEC'S Resolution, Annex I hereof, p. 22), which this Honorable Court must have meant when its Resolution of
May 23, 1978 (G.R. No. 7), it referred to "massive substitution of voters.
 4. In examining, through the NBI/COMELEC experts, the records in more than 878 voting centers examined by the KB
experts and passed upon by the Regional Board of Canvassers which was all that was within its appellate jurisdiction
is examination of more election records to make a total of 1,085 voting centers (COMELEC'S Resolution, Annex 1
hereof, p. 100), being beyond its jurisdiction and a denial of due process as far as the KBL, particularly the petitioner
Mandangan, were concerned because they were informed of it only on December, 1978, long after the case has been
submitted for decision in September, 1978; and the statement that the KBL acquiesced to the same is absolutely
without foundation.

5. In excluding election returns from areas where the conditions of peace and order were allegedly unsettled or where
there was a military operation going on immediately before and during election and where the voter turn out was high
(90 % to 100 %), and where the people had been asked to evacuate, as a ruling without jurisdiction and in violation of
due process because no evidence was at all submitted by the parties before the Regional Board of Canvasssers. (Pp.
23-25, Record, L-47917-21.)

Now before discussing the merits of the foregoing contentions, it is necessary to clarify first the nature and extent of the Supreme
Court's power of review in the premises. The Aratuc petition is expressly predicated on the ground that respondent Comelec "committed
grave abuse of discretion, amounting to lack of jurisdiction" in eight specifications. On the other hand, the Mandangan petition raises
pure questions of law and jurisdiction. In other words, both petitions invoked the Court's certiorari jurisdiction, not its appellate authority
of review.

This is as it should be. While under the Constitution of 1935, "the decisions, orders and rulings of the Commission shall be subject to
review by the Supreme Court" (Sec. 2, first paragraph, Article X) and pursuant to the Rules of Court, the petition for "certiorari or review"
shall be on the ground that the Commission "has decided a question of substance not theretofore determined by the Supreme Court, or
has decided it in a way not in accord with law or the applicable decisions of the Supreme Court" (Sec. 3. Rule 43), and such provisions
refer not only to election contests but even to pre-proclamation proceedings, the 1973 Constitution provides somewhat differently thus:
"Any decision, order or ruling of the Commission may be brought to the Supreme Court on certiorari by the aggrieved party within thirty
days from his receipt of a copy thereof" (Section 11, Article XII c), even as it ordains that the Commission shall "be the sole judge of all
contests relating to the elections, returns and qualifications of all members of the National Assembly and elective provincial and city
official" (Section 2(2).)

Correspondingly, the ElectionCode of 1978, which is the first legislative constructionof the pertinent constitutional provisions, makes the
Commission also the "sole judge of all pre-proclamation controversies" and further provides that "any of its decisions, orders or rulings
(in such contoversies) shall be final and executory", just as in election contests, "the decision of the Commission shall be final, and
executory and inappealable." (Section 193)

It is at once evident from these constitutional and statutory modifications that there is a definite tendency to enhance and invigorate the
role of the Commission on Elections as the independent constitutinal body charged with the safeguarding of free, peaceful and honest
elections. The framers of the new Constitution must be presumed ot have definite knowledge of what it means to make the decisions,
orders and rulings of the Commission "subject to review by the Supreme Court". And since instead of maintaining that provision intact, it
ordained that the Commission's actuations be instead "brought to the Supreme Court on certiorari", We cannot insist that there was no
intent to change the nature of the remedy, considering that the limited scope of certiorari, compared to a review, is well known in
remedial law.

Withal, as already stated, the legislative construction of the modified peritinent constitutional provision is to the effect that the actuations
of the Commission are final, executory and even inappealable. While such construction does not exclude the general certiorari
jurisdiction of the Supreme Court which inheres in it as the final guardian of the Constitution, particularly, of its imperious due process
mandate, it correspondingly narrows down the scope and extent of the inquiry the Court is supposed to undertake to what is strictly the
office of certiorari as distinguished from review. We are of the considered opinion that the statutory modifications are consistent with the
apparent new constitional intent. Indeed, it is obvious that to say that actuations of the Commission may be brought to the Supreme
Court on certiorari technically connotes something less than saying that the same "shall be subject to review by the Supreme Court",
when it comes to the measure of the Court's reviewing authority or prerogative in the premises.

A review includes digging into the merits and unearthing errors of judgment, while certiorari deals exclusively with grave abuse of
discretion, which may not exist even when the decision is otherwise erroneous. certiorari implies an indifferent disregard of the law,
arbitrariness and caprice, an omission to weight pertinent considerations, a decision arrived at without rational deliberation. While the
effecdts of an error of judgment may not differ from that of an indiscretion, as a matter of policy, there are matters taht by their nature
ought to be left for final determination to the sound discretion of certain officers or entities, reserving it to the Supreme Court to insure
the faithful observance of due process only in cases of patent arbitrariness.

Such, to Our mind, is the constitutional scheme relative to the Commission on Elections. Conceived by the charter as the effective
instrument to preserve the sanctity of popular suffrage, endowed with independence and all the needed concommittant powers, it is but
proper that the Court should accord the greatest measure of presumption of regularity to its course of action and choice of means in
performing its duties, to the end that it may achieve its designed place in the democratic fabric of our government. Ideally, its members
should be free from all suspicions of partisan inclinations, but the fact that actually some of them have had stints in the arena of politics
should not, unless the contrary is shown, serve as basis for denying to its actuations the respect and consideration that the Constitution
contemplates should be accorded to it, in the same manner that the Supreme Court itself which from time to time may have members
drawn from the political ranks or even from military is at all times deemed insulated from every degree or form of external pressure and
influence as well as improper internal motivations that could arise from such background or orientation.

We hold, therefore that under the existing constitution and statutory provisions, the certiorari jurisdiction of the Court over orders, and
decisions of the Comelec is not as broad as it used to be and should be confined to instances of grave abuse of discretion amounting to
patent and substantial denial of due process. Accordingly, it is in this light that We the opposing contentions of the parties in this cases.

THE MANDANGAN CASE

Being more simple in Our view, We shall deal with the petition in G.R. No. L-49717-21 first.

The errors assigned in this petition boil down to two main propositions, namely, (1) that it was an error of law on the part of respondent
Comelec to have applied to the extant circumstances hereof the ruling of this Court in Diaz vs. Comelec 42 SCRA 426 instead of that of
Bashier vs. Comelec 43 SCRA 238; and (2) that respondent Comelec exceeded its jurisdiction and denied due process to petitioner
Mandangan in extending its inquiry beyond the election records of "the 878 voting centers examined by the KB experts and passed
upon by the Regional Board of Canvassers" and in excluding from the canvass the returns showing 90 to 100 % voting, from voting
centers where military operations were by the Army to be going on, to the extent that said voting centers had to be transferred to the
poblaciones the same being by evidence.

Anent the first proposition, it must be made clear that the Diaz and Bashier rulings are not mutually exclusive of each other, each being
an outgrowth of the basic rationale of statistical improbability laid down in Lagumbay vs. Comelec and , 16 SCRA 175. Whether they be
apply together or separately or which of them be applied depends on the situation on hand. In the factual milieu of the instant case as
found by the Comelec, We see no cogent reason, and petitioner has not shown any, why returns in voting centers showing that the votes
of the candidate obtaining highest number of votes of the candidate obtaining the highest number of votes exceeds the highest possible
number of valid votes cast therein should not be deemed as spurious and manufactured just because the total number of excess votes
in said voting centers were not more than 40 %. Surely, this is not the occasion, consider the historical antecedents relative to the highly
questionable manner in which elections have been bad in the past in the provinces herein involved, of which the Court has judicial notice
as attested by its numerous decisions in cases involving practically every such election, of the Court to move a whit back from the
standards it has enunciated in those decisions.

In regard to the jurisdictional and due process points raised by herein petitioner, it is of decisive importance to bear in mind that under
Section 168 of the Revised Election Code of 1978, "the Commission (on Elections) shall have direct control and supervision on over the
board of canvassers" and that relatedly, Section 175 of the same Code provides that it "shall be the sole judge of all pre-proclamation
controversies." While nominally, the procedure of bringing to the Commission objections to the actuations of boards of canvassers has
been quite loosely referred to in certain quarters, even by the Commission and by this Court, such as in the guidelines of May 23,1978
quoted earlier in this opinion, as an appeal, the fact of the matter is that the authority of the Commission in reviewing such actuations
does not spring from any appellate jurisdiction conferred by any specific provision of law, for there is none such provision anywhere in
the Election Code, but from the plenary prerogative of direct control and supervision endowed to it by the above-quoted provisions of
Section 168. And in administrative law, it is a too well settled postulate to need any supporting citation here, that a superior body or office
having supervision and control over another may do directly what the latter is supposed to do or ought to have done.

Consequently, anything said in Lucman vs. Dimaporo, 33 SCRA 387, cited by petitioner, to the contrary notwithstanding, We cannot fault
respondent Comelec for its having extended its inquiry beyond that undertaken by the Board of Canvass On the contrary, it must be
stated that Comelec correctly and commendably asserted its statutory authority born of its envisaged constitutional duties vis-a-vis the
preservation of the purity of elections and electoral processes and p in doing what petitioner it should not have done. Incidentally, it
cannot be said that Comelec went further than even what Aratuc et al. have asked, since said complaints had impugned from the outset
not only the returns from the 878 voting centers examined by their experts but all those mentioned in their complaints in the election
cases filed originally with the Comelec enumerated in the opening statements hereof, hence respondent Comelec had that much field to
work on.

The same principle should apply in respect to the ruling of the Commission regarding the voting centers affected by military operations.
It took cognizance of the fact, not considered by the board of canvass, that said voting centers had been transferred to the poblaciones.
And, if only for purposes of pre-proclamation proceedings, We are persuaded it did not constitute a denial of due process for the
Commission to have taken into account, without the need or presentation of evidence by the parties, a matter so publicly notorious as
the unsettled situation of peace and order in localities in the provinces herein involved that their may perhaps be taken judicial notice of,
the same being capable of unquestionable demonstration. (See 1, Rule 129)

In this connection, We may as well perhaps, say here as later that regrettably We cannot, however, go along with the view, expressed in
the dissent of our respected Chief Justice, that from the fact that some of the voting centers had been transferred to the poblaciones
there is already sufficient basis for Us to rule that the Commission should have also subjected all the returns from the other voting
centers of the some municipalities, if not provinces, to the same degree of scrutiny as in the former. The majority of the Court feels that
had the Commission done so, it would have fallen into the error by petitioner Mandangan about denial of due process, for it is relatively
unsafe to draw adverse conclusions as to the exact conditions of peace and order in those other voting centers without at list
some prima facie evidence to rely on considering that there is no allegation, much less any showing at all that the voting centers in
question are so close to those excluded by the Comelec on as to warrant the inescapable conclusion that the relevant circumstances by
the Comelec as obtaining in the latter were Identical to those in the former.

Premises considered the petition in G.R. Nos. L-49717-21 is hereby dismiss for lack of merit.

THE ARATUC ET AL. PETITION

Of the eight errors assigned by herein petitioners earlier adverted to, the seventh and the sight do not require any extended disquisition.
As to the issue of whether the elections in the voting centers concerned were held on April 7, 1978, the date designated by law, or
earlier, to which the seventh alleged error is addressed, We note that apparently petitioners are not seriously pressing on it anymore, as
evidenced by the complete absence of any reference thereto during the oral argument of their counsel and the practically cavalier
discussion thereof in the petition. In any event, We are satisfied from a careful review of the analysis by the Comelec in its resolution
now before Us that it took pains to consider as meticulously as the nature of the evidence presented by both parties would permit all the
contentions of petitioners relative to the weight that should be given to such evidence. The detailed discussion of said evidence is
contained in not less than nineteen pages (pp. 70-89) of the resolution. In these premises, We are not prepared to hold that Comelec
acted wantonly and arbitrarily in drawing its conclusions adverse to petitioners' position. If errors there are in any of those conclusions,
they are errors of judgment which are not reviewable in certiorari, so long as they are founded on substantial evidence.

As to eighth assigned error. the thrust of respondents, comment is that the results in the voting centers mentioned in this assignment of
error had already been canvassed at the regional canvass center in Cotabato City. Again, We cannot say that in sustaining the board of
canvassers in this regard, Comelec gravely abused its discretion, if only because in the guidelines set by this Court, what appears to
have been referred to is, rightly or wrongly, the resumption only of the canvass, which does not necessarily include the setting aside and
repetition of the canvass already made in Cotabato City.

The second and fourth assignments of error concern the voting centers the corresponding voters' record (C.E. Form 1) and record of
voting, (C.E. Form 5) of which have never been brought to Manila because they, were not available The is not clear as to how many are
these voting centers. According to petitioners they are 501, but in the Comelec resolution in question, the number mentioned is only 408,
and this number is directly challenged in the petition. Under the second assignment, it is contended that the Comelec gravely abused its
discretion in including in the canvass the election returns from these voting centers and, somewhat alternatively, it is alleged as fourth
assignment that the petitioners motion for the opening of the ballot boxes pertaining to said voting centers was arbitraly denied by
respondent Comelec.

The resolution under scrutiny explains the situation that confronted the Commission in regard to the 408 voting centers reffered to as
follows :

The Commission had the option of excluding from the canvass the election returns under category. By deciding to
exclude, the Commission would be summarily disenfranchising the voters registered in the voting centers affected
without any basis. The Commission could also order the inclusion in the canvass of these elections returns under the
injunction of the Supreme Court that extremes caution must be exercised in rejecting returns unless these are
palpably irregular. The Commission chose to give prima facie validity to the election returns mentioned and uphold the
votes cast by the voters in those areas. The Commission held the view that the failure of some election officials to
comply with Commission orders(to submit the records) should not parties to such official disobedience. In the case of
Lino Luna vs. Rodriguez, 39 Phil. 208, the Supreme Court ruled that when voters have honestly cast their ballots, the
same should not be nullified because the officers appointed under the law to direct the election and guard the purity of
the ballot have not complied with their duty. (cited in Laurel on Elections, p. 24)

On page 14 of the comment of the Solicitor General, however, it is stated that:

At all events, the returns corresponding to these voting centers were examined by the Comelec and 141 of such
returns were excluded, as follows:

SUMMARY

PROVINCE TOTAL EXCLUDED INCLUDED

Lanao del Norte 30 — 30

Lanao del Sur 342 137 205

Maguindanao 21 1 20

North Cotabato 7 1 6

Sultan Kudarat 12 2 10

totals ----- 412 141 271

(Page 301, Record.)

This assertion has not been denied by petitioners.

Thus, it appears that precisely use of the absence or unavailability of the CE Forms 1 and 5 corresponding to the more than 400 voting
centers concerned in our present discussion the Comelec examined the returns from said voting centers to determine their
trustworthiness by scrutinizing the purported relevant data appearing on their faces, believing that such was the next best thing that
could be done to avoid total disenfranchisement of the voters in all of them On the Other hand, Petitioners' insist that the right thing to do
was to order the opening of the ballot boxes involved.

In connection with such opposing contentions, Comelec's explanation in its resolution is:

... The commission had it seen fit to so order, could have directed the opening of the ballot boxes. But the Commission
did not see the necessity of going to such length in a that was in nature and decided that there was sufficient bases for
the revolution of the appeal. That the Commission has discretion to determine when the ballot boxes should be
opened is implicit in the guidelines set by the Supreme Court which states that '. . . the ballot bones [which] shall be
opened only upon orders of either the respondent Board or respondent Commission, after the need therefor has
become evident ... ' (guideline No. 3; emphasissupplied). Furthermore, the Court on June 1, 1978, amended the
guidelines that the "ballot boxes for the voting centers ... need not be taken to Manila EXCEPT those of the centers as
to which the petitioners have the right to demand that the corresponding ballot boxes be opened ... provided that the
voting centers concerned shall be specified and made known by petitioners to the Regional Board of Canvassers not
later than June 3,1978 ... ' (Emphasis supplied). The KB, candidates did not take advantage of the option granted
them under these guidelines.( Pp 106-107, Record.)

Considering that Comelec, if it had wished to do so, had the facilities to Identify on its own the voting centers without CE Forms I and 5,
thereby precluding the need for the petitioners having to specify them, and under the circumstances the need for opening the ballot
boxes in question should have appeared to it to be quite apparent, it may be contended that Comelec would have done greater service
to the public interest had it proceeded to order such opening, as it had announced it had thoughts of doing in its resolution of August 30,
1978. On the other hand, We cannot really blame the Commission too much, since the exacting tenor of the guidelines issued by Us left
it with very little elbow room, so to speak, to use its own discretion independently of what We had ordered. What could have saved
matters altogether would have been a timely move on the part of petitioners on or before June 3, 1978, as contemplated in Our
resolution. After all come to think of it, that the possible outcome of the opening of the ballot boxes would favor the petitioners was not a
certainty — the contents them could conceivably boomerang against them, such as, for example, if the ballots therein had been found to
be regular and preponderantly for their opponents. Having in mind that significantly, petitioners filed their motion for only on January 9,
1979, practically on the eve of the promulgation of the resolution, We hold that by having adhered to Our guidelines of June 1, 1978,
Comelec certainly cannot be held to be guilty of having gravely abused its discretion, in examining and passing on the returns from the
voting centers reffered to in the second and fourth assignments of error in the canvass or in denying petitioners' motion for the of the
ballot boxes concerned.

The first, third and sixth assignment of involve related matters and maybe discussed together. They all deal with the inclusion in or
exclusion from the canvass of returns on the basis of the percentage of voting in specified voting centers and the corresponding findings
of the Comelec on the extent of substitute voting therein as indicated by the result of either the technical examination by experts of the
signatures and thumb-prints of the voters threat.

To begin with, petitioners' complaint that the Comelec did not examine and study 1,694 of the records in an the 2,775 voting centers
questioned by them is hardly accurate. To be more exact, the Commission excluded a total of 1,267 returns coming under four
categories namely: 1,001 under the Diaz, supra, ruling, 79 because of 90-100 % turnout of voters despite military operations, 105
palpably manufactured owe and 82 returns excluded by the board of canvass on other grounds. Thus, 45.45 % of the of the petitioners
were sustained by the Comelec. In contrast, in the board of canvassers, only 453 returns were excluded. The board was reversed as to
6 of these, and 821 returns were excluded by Comelec over and above those excluded by the board. In other words, the Comelec
almost doubled the exclusions by the board.

Petitioners would give the impression by their third assignment of error that Comelec refused to consider high percentage of voting,
coupled with mass substitute voting, as proof that the pertinent returns had been manufactured. That such was not the case is already
shown in the above specifications. To add more, it can be gleaned from the resolution that in t to the 1,065 voting centers in Lanao del
Sur and Marawi City where a high percentage of voting appeared, the returns from the 867 voting centers were excluded by the
Comelec and only 198 were included a ratio of roughly 78 % to 22 %. The following tabulation drawn from the figures in the resolution
shows how the Comelec went over those returns center by center and acted on them individually:

90% — 100% VOTING

MARAWI CITY AND LANAO DEL SUR

NO. OF V/C THAT V/C WITH 90% to 100%

MUNICIPALITIES FUNCTIONED VOTING

No. Excluded Included

of
V/C

Marawi City 151 112 10 5

7

Bacolod Grande 28 28 27 1
Balabagan 53 53 49 4

Balindong 22 22 15 7

Bayang 29 20 13 7

Binidayan 37 33 29 4

Buadiposo Bunton 41 10 10 0

Bubong 24 23 21 2

Bumbaran 21 (All
exclude
d)

Butig 35 33 32 1

Calanogas 23 21 21 0

Ditsaan-Ramain 42 39 38 1

Ganassi 39 38 23 15

Lumba Bayabao 64 63 47 16

Lumbatan 30 28 17 11

Lumbayanague 37 33 28 5

Madalum 14 13 6 7
Madamba 20 20 5 15

Maguing 57 55 53 2

Malabang 59 47 5 42

Marantao 79 63 41 22

Marugong 37 35 32 3

Masiu 27 26 24 2

Pagayawan 15 13 9 4

Piagapo 39 39 36 3

Poona-Bayabao 44 44 42 2

Pualas 23 20 20 0

Saguiaran 36 32 21 11

Sultan Gumander 35 31 31 0

Tamparan 24 21 15 6

Taraka 31 31 31 0

Tubaran 23 19 19 0

TOTALS: Marawi &

 Lanao del Sur 1,218 1,0 86 198
65 7

We are convinced, apart from presuming regularity in the performance of its duties, that there is enough showing in the record that it did
examine and study the returns and pertinent records corresponding to all the 2775 voting centers subject of petitioners' complaints
below. In one part of its resolution the Comelec states:

The Commission as earlier stated examined on its own the Books of Voters (Comelec Form No. 1) and the Voters
Rewards Comelec Form No. 5) to determine for itself which of these elections form needed further examination by the
COMELEC-NBI experts. The Commission, aware of the nature of this pre-proclamation controversy, believes that it
can decide, using common sense and perception, whether the election forms in controversy needed further
examination by the experts based on the presence or absence of patent signs of irregularity. (Pp. 137-138, Record.)

In the face of this categorical assertion of fact of the Commission, the bare charge of petitioners that the records pertaining to the 1,694
voting centers assailed by them should not create any ripple of serious doubt. As We view this point under discussion, what is more
factually accurate is that those records complained of were not examined with the aid of experts and that Comelec passed upon the
returns concerned "using common sense and perception only." And there is nothing basically objectionable in this. The defunct
Presidential Senate and House Electoral Tribunals examine passed upon and voided millions of votes in several national elections
without the assistance of experts and "using" only common sense and perception". No one ever raised any eyebrows about such
procedure. Withal, what we discern from the resolution is that Comelec preliminary screened the records and whatever it could not
properly pass upon by "using common sense and perception" it left to the experts to work on. We might disagree with he Comelec as to
which voting center should be excluded or included, were We to go over the same records Ourselves, but still a case of grave abuse of
discretion would not come out, considering that Comelec cannot be said to have acted whimsically or capriciously or without any rational
basis, particularly if it is considered that in many respects and from the very nature of our respective functions, becoming candor would
dictate to Us to concede that the Commission is in a better position to appreciate and assess the vital circumstances closely and
accurately. By and large, therefore, the first, third and sixth assignments of error of the petitioners are not well taken.

The fifth assignment of error is in Our view moot and academic. The Identification of the ballot boxes in defective condition, in some
instances open and allegedly empty, is at best of secondary import because, as already discussed, the records related thereto were
after all examined, studied and passed upon. If at all, deeper inquiry into this point would be of real value in an electoral protest.

CONCLUSION

Before closing, it may not be amiss to state here that the Court had initially agreed to dispose of the cases in a minute resolution, without
prejudice to an extended or reasoned out opinion later, so that the Court's decision may be known earlier. Considering, however, that no
less than the Honorable Chief Justice has expressed misgivings as to the propriety of yielding to the conclusions of respondent
Commission because in his view there are strong considerations warranting farther meticulous inquiry of what he deems to be earmarks
of seemingly traditional faults in the manner elections are held in the municipalities and provinces herein involved, and he is joined in
this pose by two other distinguished colleagues of Ours, the majority opted to ask for more time to put down at least some of the
important considerations that impelled Us to see the matters in dispute the other way, just as the minority bidded for the opportunity to
record their points of view. In this manner, all concerned will perhaps have ample basis to place their respective reactions in proper
perspective.

In this connection, the majority feels it is but meet to advert to the following portion of the ratiocination of respondent Board of
Canvassers adopted by respondent Commission with approval in its resolution under question:

First of all this Board was guided by the legal doctrine that canvassing boards must exercise "extreme caution" in
rejecting returns and they may do so only when the returns are palpably irregular. A conclusion that an election return
is obviously manufactured or false and consequently should be disregarded in the canvass must be approached with
extreme caution, and only upon the most convincing proof. Any plausible explanation one which is acceptable to a
reasonable man in the light of experience and of the probabilities of the situation, should suffice to avoid outright
nullification, with the resulting t of those who exercised their right of suffrage. (Anni vs. Isquierdo et at L-35918, Jude
28,1974; Villavon v. Comelec L-32008, August 31,1970; Tagoranao v. Comelec 22 SCRA 978). In the absence of
strong evidence establishing the spuriousness of the return, the basis rule of their being accorded prima facie status
as bona fide reports of the results of the count of the votes for canvassing and proclamation purposes must be
applied, without prejudice to the question being tried on the merits with the presentation of evidence, testimonial and
real in the corresponding electoral protest. (Bashier vs. Comelec L-33692, 33699, 33728, 43 SCRA 238, February 24,
1972). The decisive factor is that where it has been duly de ed after investigation and examination of the voting and
registration records hat actual voting and election by the registered voters had taken place in the questioned voting
centers, the election returns cannot be disregarded and excluded with the resting disenfranchisement of the voters,
but must be accorded prima facie status as bona fide reports of the results of the voting for canvassing and
registration purposes. Where the grievances relied upon is the commission of irregularities and violation of the
Election Law the proper remedy is election protest. (Anni vs. Isquierdo et al. Supra). (P. 69, Record, L-49705-09).

The writer of this opinion has taken care to personally check on the citations to be doubly sure they were not taken out of context,
considering that most, if not all of them arose from similar situations in the very venues of the actual milieu of the instant cases, and We
are satisfied they do fit our chosen posture. More importantly, they actually came from the pens of different members of the Court,
already retired or still with Us, distinguished by their perspicacity and their perceptive prowess. In the context of the constitutional and
legislative intent expounded at the outset of this opinion and evident in the modifications of the duties and responsibilities of the
Commission on Elections vis-a-vis the matters that have concerned Us herein, particularly the elevation of the Commission as the "sole
judge of pre-proclamation controversies" as well as of all electoral contests, We find the afore-quoted doctrines compelling as they
reveal through the clouds of existing jurisprudence the pole star by which the future should be guided in delineating and circumscribing
separate spheres of action of the Commission as it functions in its equally important dual role just indicated bearing as they do on the
purity and sanctity of elections in this country.

In conclusion, the Court finds insufficient merit in the petition to warrant its being given due course. Petition dismissed, without
pronouncement as to costs. Justices Fernando, Antonio and Guerrero who are presently on official missions abroad voted for such
dismissal.

Fernando, Antonio, Concepcion Jr., Santos Fernandez, and Guerrero, JJ., concur.

Teehankee, J. took no part.

Aquino and Abad Santos, Jr., took no part.

Separate Opinions

CASTRO, C.J., dissenting:

At the outset I must state that constraints of time effectively prevent me from writing an extended dissent. Hence, this abbreviated
exposition of my views.

For a clear understanding of the issues, a summary of the essential events relative to these cases is necessary.

On April 7, 1978, elections of representatives to the Batasang Pambansa were held throughout the Philippines. The cases at bar
concern only the results of the elections in Region XII (Central Mindanao) which compromises the p s Of Lanao del Sur, Lanao del
Norte, Maguindanao, North Cotabato and Sultan Kudarat, and the cities of Marawi, Iligan and Cotabato. (The entire Region had a total
of 4,107 voting center but only 3,984 were functions).

On June 11, 1978, the Region Board of Canvassers issued a resolution, Over the objection of the Konsensiya ng Bayan (KB) candidates
d all the eight Kilusang ng Bagong Lipunan (KBL) candidates elected. Appeal was taken by the KB candidates to the On January 13,
1979, the Comelec its questioned resolution KBL can candidates and one KB candidate as having obtained the first eight places, and
ordering the Regional Board of Can to p the winning candidates. The KB candidate forewith the present petition ; in due time the
respondents filed their comments.

Oral argument was had before the Court for two days, specifically on January 31 and February 1, 1979. Atty. Lino Patajo argued for and
in behalf of the KB candidates, Assemblyman Estanislao Fernandez for the KBL and the private respondents and Solicitor General
Estelito P. Mendoza for the public respondents. The Court subjected the three counsels to intensive interrogation. The cases were then
sub. muted for decision in the afternoon of February 1.

I have carefully read the entire record, more particularly the Comelec resolution of January 13, 1979, and I must confess that until now
my mind cannot rest easy on a number of questions sharply in issue, some of which are hereunder briefly discussed.

a. After the Comelec examined very closely the voting returns, books of voting and voting records from 1, 116 voting centers protested
by the KB candidates, to the extent of subjecting them to detailed documentary examination and finger print comparison by Comelec
experts, and thereafter annulled 31.84% of the votes cast, why did it refuse to proceed to subject all the records of the remaining 1,659
voting centers protested by the KB candidates to the same manner of close scrutiny?

b. Why did not the Comelec examine, utilizing the same meticulous method, similar documents and records appertaining to a total of
164 voting centers in Lanao del Sur and 19 voting centers in Lanao del Norte—two provinces where concededly there had been military
operations—and an additional number of voting centers in the other provinces, all of which registered a 100 % turnout of voters? The
peace and order conditions in the two cities of Iligan and Cotabato on the day of the elections were normal and yet the total percentages
of voting were only 73 % and 52 %, lively. How then can the Comelec explained why and how in many voting centers located in areas
where there had been military operations there was a voting turnout of 100 %? Assuming that the KB candidates did not call the
attention of the Comelec—although they actually did—to the stark improbability of 100 % vote turnout in the said places, because the
peace and order conditions were far from normal it perforce devolved on the Comelec to conduct, motu propio, an in-depth and full-
blown inquiry into this paradox. The record shows that there was l00 % voting in the whole of each of three municipalities, over 99 %
viting in each of thirteen other municipalities, and an average 97 % turnout in five more municipalities. Of inescapable significance is the
fact that most of these municipalities are located in the provinces of Lanao del Sur and Lanao del Norte, the past election history of
which is replete with the perpetration of massive frauds, terrorism and scandalous substitutions of voters.
c. Why did the Comelec deny the motion of the KB candidates for the opening of ballot boxes Pertaining to a total of 408 voting centers
— the voting record of which were not available as they had somehow mysteriously disappeared — to determine whether or not the
election in each of the said voting centers was a sham? This remedial measure was resorted to by the Comelec in 1969 when it Order
the opening of a number of ballot boxes in the pre-proclamation contest in Lucman vs. Dimaporo in order to see whether or not there
were ballots, and determine whether there had been an actual election in each of the disputed precincts. In that case to almost 200
ballot boxes found to be without padlocks?

Of incalculable significance is the abscence of any statement in the Comelec resolution that indicates that, granting that all the questions
I have above raised would be resolved in favor of the KB candidates, the election results would not be materially altered.Upon the other
hand , the KB candidates state categorically, with benefit of extrapolation, that the election results would be considerably changed in
their favor.

The majority of my brethren anchor their denial of the petition on two principal grounds, namely:

a. The issues raised by the KB candidates would be better and properly ventilated in an election protest; and

b. No grave abuse of discretion is discernible from the actuations of the Comelec.

Anent the first ground, it is a notorious fact in the history of Philippine politics that an election protest not only is usually inordinately
protracted but as well entails heavy and prohibitive expenditure of time, money and effort on the part of the protestant. More than this,
should the protestant in the end win, very little time or none at all is left for him to assume and discharge the duties of his office. In the
meantime, the person previously proclaimed elected continues to fraudulently represent the people who had in law and in fact duly
elected someone else to represent them.

Besides, taking a broad view of the fundamental issues raised by the KB candidates, I am of the opinion that resolution of these issues
by the Comelec would not take more than six months of conscientious labor—and surely this period is short, very short indeed,
compared to the time that win be wasted by the Comelec in deciding a formal electoral protest. Is it not time the Supreme Court asserted
its powers in order to excise completely the Old Society pernicious evil of "grab the proclamation at all costs"?

Anent the second ground, I squarely traverse the statement that no grave abuse of discretion can be imputed to the Comelec. The grave
misgivings I have above articulated demonstrate what to my mind constitute the size and shape of the remissness of the Comelec. And
more compelling and over-riding a consideration than the overwrought technicality of "grave abuse of discretion" is the fundamental
matter of the faith of the people of Region XII in the electoral process. There will always be the nagging question in the minds of the
voters in that Region as to the legitimacy of those who will be proclaimed elected under the Comelec resolution should the Court refuse
to direct that body to continue the meticulous for legitimacy and truth.

Upon all the foregoing, it behooves the Court to remand these cases to the Comelec, with the direction that body immediately convene
and within an unextendible period and as speedily as possible, resolve with definitiveness all the questions I have above posed, under
such unequivocal guidelines as the Court may prescribe.

For my part, unless and until this is done, I shall continue to enter grave doubt as to the correctness and validity of the results already
reached by the Comelec, especially when political history, placed in perspective, pointedly reminds me of the massive frauds, terrorism
and scandalous substitutions of voters that have characterized past elections in the two Lanao provinces.

DE CASTRO, J., concuring:

The present case has afforded Us an early opportunity to examine and define the extent of the power of judicial review as granted to the
Supreme Court over any decision, order or ruling of the Commission on Elections under the new Constitution the pertinent provision of
which reads:

Section 11. Any decision order or ruling of the on may be brought to the Supreme Court on certiorari by the party
within thirty days from his receipt of a copy thereof XII, Constitution).

The Commission on Elections has been granted powers under the new Constitution which, under the old Constitution, belonged either to
the legislative body(Electoral Tribunals) or the courts. This evident from the provision of the new Constitution which reads:

(2) Be the sole judge of all contents relating to the elections, returns, and quallifications of all Members of the National
Assembly and elective provincial and city officials. (Section 2, Article XII, Constitution).

The Commission is thus envisioned to exercise exclusive powers on all electoral matters except the right to vote, such as the
enforcement and administration of laws relative to the conduct of elections deciding administrative questions affecting elections, except
those involving the right to vote, but also those that heretofore have been agreed as matters for strictly judicial inquiry, such as the
hearing and disposition of election contests, as is doubtlessly shown by the transfer thereto of the powers previously conferred upon the
Electoral Tribunal of Congress and the Courts. (see Section 2, par. 2, Article XII, New Constitution). This change may properly be viewed
as having the intention to relieve the Courts, particularly the Supreme Court, of those burdens placed upon them relating to the conduct
of election and matters incident thereto. It could have been, likewise, intended to insulate judicial bodies from the baneful effects of
partisan politics, the more deleterious ones being those that could come from the higher mats of political power, such a those in the
Assembly and in the provincial and city government levels.

It is, therefore, my view that what was intended by the new Constitution is to limit the intervention of the Supreme Court in the acts of the
Commission as constitutional body like said Court, but with broadened powers, allocating to it a domain as exclusive as that of the
legislative body (which includes the President or Prime Minister) on matters of lawmaking , to that of "judicial inquiry". This power is
confined to justifiable questions not of political nature, and always involving alleged violation of constitutional rights or the constitution
itself.. For a controversy of a political character, commonly referred to as "Political questions", is excluded from the scope of the
Supreme Courts power of judicial inquiry. 1 The exclusive character of the Power conferred upon the Commission on Elections, and
considering that political rights, as distinguished from civil and personal Or Property rights, 2 are for the most part, if not in their totality,
the subject of its authority, should counsel an expansive intervention by the Supreme Court in the acts of the Commission on Election.
With the confernment of exclusive authority on the electoral process upon it, the Commission may be said to have been given hill
discretionary authority, the exercise of which would give rise to a controversy involving a political question. 3

What then is the test or criterion in de whether the Supreme Court may exercise its power under Article XII, Section 11 of the new
Constitution? It is my humble submission that the aforecited provision is merely a reassertion of the power of the Supreme Court as
guardian of the Constitution and protector of constitutional rights, of which, under no circumstance, could it be deprived, if our present
Constitution system is to be maintained. For it is a power constitutionally assigned to it as the essence of the high judicial power of the
Supreme Court, for the orderly and salutary apportionment of governmental powers among the different b of the government, as well as
the Constitution bodies created to deal more effectively with specific matters requiring governmental actions.

Examining the instant petition, nothing reveals itself as raising more than questions merely affecting the conduct of the election held on
April 7, 1978, much less a truly constitutional question, aside perhaps from the alegation that the COMELEC undertook an examination
of election records beyond those examined during the pendency of the controversy before the Regional Board of Canvassers, allegedly
without notice to the petitioners, thus intimating a violation of due process. This particular matter, however, can easily be disposed of by
citing the provision of Section 175 of the Electoral Code of 1978 which reads:

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

If the Commission has the power to suspend motu proprio the proclamation of a candidate-elect it must have the power to conduct
inquiry into the cause for which it ordains the suspension of the proclamation such as making its own examination of the integrity of
election returns or inquiring into any relevant matter affecting the purity of the ballot. Notice is required by the legal provision cited, but
this must be notice to the party adversely affected, the candidate-elect whose proclamation is suspended. The action taken by the
COMELEC in e additional election documents to those examined by the KB experts during the pendency of the controversy with the
Regional Board of Canvassers was, therefore, one of which petitioners cannot be heard, nor have any reason, one of which petitioners
cannot be heard, nor have any reason, to complain, for it even resulted in one KB candidate getting into the winners column. If the
COMELEC stopped at a certain point in its examination, instead of going through all those questioned by the petitioners, evidently due
to time constraint as fixed in the guidelines, set by this Court, and the character of pre-proclamation proceedings , it cannot be charged
with abuse of discretion, much less a grave one. it did not have to conduct the additional examination, in the first place. The controversy
which was heard and decided in the first instance, by the Regional Board of Canvassers, with guidelines set by this Court, was appealed
to the COMELEC. The latter's appellate authority was thus limited to a review of the decision of the Board on the basis of the evidence
presented before it, rendering its own decision on the basis of the evidence, and no more. It incorporated the result of its own
examination of additional election returns, and found one KB as one of the candidate, a fact clearly showing that COMELEC did
examine the said documents, otherwise , the result as previously declared by the Board of Canvassers with a clean sweep of the KBL
candidate would have remained unaltered.

Expounding more on the one circumstance inclining me to the theory that with the enlarged power and broadened authority of the
COMELEC which to and cover virtually the entire electoral process, as exclusively as the power of legislation is constitutionally lodged in
the law-making body, what is given to the Supreme Court as its reviewing authority over acts of the COMELEC is no more than what it
could exercise under its power of judicial inquiry with to acts of the legislative body, which is the transfer to the COMELEC of the powers
pertaining to the Electoral Tribunals and the courts under the old Constitution over election contests, it must not be hard to concede that
with the composition of the electoral tribunals in which six of the justices of the Supreme Court sit in said bodies, the Supreme Court
crowd no longer exercise any reviewing authority over the acts of the said electoral tribunals except possibly when violation of the
Constitution or constitution rights are involved. With this limited concept of this Court's authority over the defunct electoral tribunals now
applied to an equally constitutional body that the COMELEC is that took over the function of the Election Tribunal would hesitate to hold
that Supreme Court may grant the relief as in prayed for in the present petition.

If this is so under the law and the Constitution, it should also be upon consideration of public policy. The last elections were called by the
President as a test or t as to how the vital reforms and changes of political and social discipline and moral values he has instituted to
evolve a new order have affected the thinking and the attitudes of our Tribunal should be extreme caution, if not restraint, in any act on
our part that might reflect on the success or failure of that experiment intended, at the time as a big stride in the way back to
normalization. This is specially true in the field of politics where the ills of the Old Society has been most grave, because our elections
then as a democratic process, have tarnished the image of our country as a representative democracy. Except on very compelling
reasons then, which I believe do not exist in the case before Us, should we make any pronouncement that would detract on how
successful the last political exercise had been, as the first election held under the new Constitution. We must refrain from imputing to the
COMELEC which has been enlarged with fresh mandate and a bigger trust by the Constitution failure in the performance of its functions
either by willfull neglect, official incompetence, much less by deliberate partiality, in the first real test of its capability.

In the light of the foregoing, I vote, in concurrence with the majority, to dismiss the petition, first, as to the matter allegedly involving a
violation of the petitioners' right of due process on the ground that there was no denial thereof, and second, as to the other matters
involving no violation of constitutional rights, on the ground they are purely political questions, and that in any case, no grave abuse of
discretion has been committed by, much leas is there lack or excess of jurisdiction on the part of, the Commission on Elections.
# Separate Opinions

CASTRO, C.J., dissenting:

At the outset I must state that constraints of time effectively prevent me from writing an extended dissent. Hence, this abbreviated
exposition of my views.

For a clear understanding of the issues, a summary of the essential events relative to these cases is necessary.

On April 7, 1978, elections of representatives to the Batasang Pambansa were held throughout the Philippines. The cases at bar
concern only the results of the elections in Region XII (Central Mindanao) which compromises the p s Of Lanao del Sur, Lanao del
Norte, Maguindanao, North Cotabato and Sultan Kudarat, and the cities of Marawi, Iligan and Cotabato. (The entire Region had a total
of 4,107 voting center but only 3,984 were functions).

On June 11, 1978, the Region Board of Canvassers issued a resolution, Over the objection of the Konsensiya ng Bayan (KB) candidates
d all the eight Kilusang ng Bagong Lipunan (KBL) candidates elected. Appeal was taken by the KB candidates to the On January 13,
1979, the Comelec its questioned resolution KBL can candidates and one KB candidate as having obtained the first eight places, and
ordering the Regional Board of Can to p the winning candidates. The KB candidate forewith the present petition ; in due time the
respondents filed their comments.

Oral argument was had before the Court for two days, specifically on January 31 and February 1, 1979. Atty. Lino Patajo argued for and
in behalf of the KB candidates, Assemblyman Estanislao Fernandez for the KBL and the private respondents and Solicitor General
Estelito P. Mendoza for the public respondents. The Court subjected the three counsels to intensive interrogation. The cases were then
sub. muted for decision in the afternoon of February 1.

I have carefully read the entire record, more particularly the Comelec resolution of January 13, 1979, and I must confess that until now
my mind cannot rest easy on a number of questions sharply in issue, some of which are hereunder briefly discussed.

a. After the Comelec examined very closely the voting returns, books of voting and voting records from 1, 116 voting centers protested
by the KB candidates, to the extent of subjecting them to detailed documentary examination and finger print comparison by Comelec
experts, and thereafter annulled 31.84% of the votes cast, why did it refuse to proceed to subject all the records of the remaining 1,659
voting centers protested by the KB candidates to the same manner of close scrutiny?

b. Why did not the Comelec examine, utilizing the same meticulous method, similar documents and records appertaining to a total of
164 voting centers in Lanao del Sur and 19 voting centers in Lanao del Norte—two provinces where concededly there had been military
operations—and an additional number of voting centers in the other provinces, all of which registered a 100 % turnout of voters? The
peace and order conditions in the two cities of Iligan and Cotabato on the day of the elections were normal and yet the total percentages
of voting were only 73 % and 52 %, lively. How then can the Comelec explained why and how in many voting centers located in areas
where there had been military operations there was a voting turnout of 100 %? Assuming that the KB candidates did not call the
attention of the Comelec—although they actually did—to the stark improbability of 100 % vote turnout in the said places, because the
peace and order conditions were far from normal it perforce devolved on the Comelec to conduct, motu propio, an in-depth and full-
blown inquiry into this paradox. The record shows that there was l00 % voting in the whole of each of three municipalities, over 99 %
viting in each of thirteen other municipalities, and an average 97 % turnout in five more municipalities. Of inescapable significance is the
fact that most of these municipalities are located in the provinces of Lanao del Sur and Lanao del Norte, the past election history of
which is replete with the perpetration of massive frauds, terrorism and scandalous substitutions of voters.

c. Why did the Comelec deny the motion of the KB candidates for the opening of ballot boxes Pertaining to a total of 408 voting centers
—the voting record of which were not available as they had somehow mysteriously disappeared—to determine whether or not the
election in each of the said voting centers was a sham? This remedial measure was resorted to by the Comelec in 1969 when it Order
the opening of a number of ballot boxes in the pre-proclamation contest in Lucman vs. Dimaporo in order to see whether or not there
were ballots, and determine whether there had been an actual election in each of the disputed precincts. In that case to almost 200
ballot boxes found to be without padlocks?

Of incalculable significance is the abscence of any statement in the Comelec resolution that indicates that, granting that all the questions
I have above raised would be resolved in favor of the KB candidates, the election results would not be materially altered.Upon the other
hand , the KB candidates state categorically, with benefit of extrapolation, that the election results would be considerably changed in
their favor.

The majority of my brethren anchor their denial of the petition on two principal grounds, namely:

a. The issues raised by the KB candidates would be better and properly ventilated in an election protest; and
b. No grave abuse of discretion is discernible from the actuations of the Comelec.

Anent the first ground, it is a notorious fact in the history of Philippine politics that an election protest not only is usually inordinately
protracted but as well entails heavy and prohibitive expenditure of time, money and effort on the part of the protestant. More than this,
should the protestant in the end win, very little time or none at all is left for him to assume and discharge the duties of his office. In the
meantime, the person previously proclaimed elected continues to fraudulently represent the people who had in law and in fact duly
elected someone else to represent them.

Besides, taking a broad view of the fundamental issues raised by the KB candidates, I am of the opinion that resolution of these issues
by the Comelec would not take more than six months of conscientious labor—and surely this period is short, very short indeed,
compared to the time that win be wasted by the Comelec in deciding a formal electoral protest. Is it not time the Supreme Court asserted
its powers in order to excise completely the Old Society pernicious evil of "grab the proclamation at all costs"?

Anent the second ground, I squarely traverse the statement that no grave abuse of discretion can be imputed to the Comelec. The grave
misgivings I have above articulated demonstrate what to my mind constitute the size and shape of the remissness of the Comelec. And
more compelling and over-riding a consideration than the overwrought technicality of "grave abuse of discretion" is the fundamental
matter of the faith of the people of Region XII in the electoral process. There will always be the nagging question in the minds of the
voters in that Region as to the legitimacy of those who will be proclaimed elected under the Comelec resolution should the Court refuse
to direct that body to continue the meticulous for legitimacy and truth.

Upon all the foregoing, it behooves the Court to remand these cases to the Comelec, with the direction that body immediately convene
and within an unextendible period and as speedily as possible, resolve with definitiveness all the questions I have above posed, under
such unequivocal guidelines as the Court may prescribe.

For my part, unless and until this is done, I shall continue to enter grave doubt as to the correctness and validity of the results already
reached by the Comelec, especially when political history, placed in perspective, pointedly reminds me of the massive frauds, terrorism
and scandalous substitutions of voters that have characterized past elections in the two Lanao provinces.

DE CASTRO, J., concuring:

The present case has afforded Us an early opportunity to examine and define the extent of the power of judicial review as granted to the
Supreme Court over any decision, order or ruling of the Commission on Elections under the new Constitution the pertinent provision of
which reads:

Section 11. Any decision order or ruling of the on may be brought to the Supreme Court on certiorari by the party
within thirty days from his receipt of a copy thereof XII, Constitution).

The Commission on Elections has been granted powers under the new Constitution which, under the old Constitution, belonged either to
the legislative body(Electoral Tribunals) or the courts. This evident from the provision of the new Constitution which reads:

(2) Be the sole judge of all contents relating to the elections, returns, and quallifications of all Members of the National
Assembly and elective provincial and city officials. (Section 2, Article XII, Constitution).

The Commission is thus envisioned to exercise exclusive powers on all electoral matters except the right to vote, such as the
enforcement and administration of laws relative to the conduct of elections deciding administrative questions affecting elections, except
those involving the right to vote, but also those that heretofore have been agreed as matters for strictly judicial inquiry, such as the
hearing and disposition of election contests, as is doubtlessly shown by the transfer thereto of the powers previously conferred upon the
Electoral Tribunal of Congress and the Courts. (see Section 2, par. 2, Article XII, New Constitution). This change may properly be viewed
as having the intention to relieve the Courts, particularly the Supreme Court, of those burdens placed upon them relating to the conduct
of election and matters incident thereto. It could have been, likewise, intended to insulate judicial bodies from the baneful effects of
partisan politics, the more deleterious ones being those that could come from the higher mats of political power, such a those in the
Assembly and in the provincial and city government levels.

It is, therefore, my view that what was intended by the new Constitution is to limit the intervention of the Supreme Court in the acts of the
Commission as constitutional body like said Court, but with broadened powers, allocating to it a domain as exclusive as that of the
legislative body (which includes the President or Prime Minister) on matters of lawmaking , to that of "judicial inquiry". This power is
confined to justifiable questions not of political nature, and always involving alleged violation of constitutional rights or the constitution
itself.. For a controversy of a political character, commonly referred to as "Political questions", is excluded from the scope of the
Supreme Courts power of judicial inquiry. 1 The exclusive character of the Power conferred upon the Commission on Elections, and
considering that political rights, as distinguished from civil and personal Or Property rights, 2 are for the most part, if not in their totality,
the subject of its authority, should counsel an expansive intervention by the Supreme Court in the acts of the Commission on Election.
With the confernment of exclusive authority on the electoral process upon it, the Commission may be said to have been given hill
discretionary authority, the exercise of which would give rise to a controversy involving a political question. 3

What then is the test or criterion in de whether the Supreme Court may exercise its power under Article XII, Section 11 of the new
Constitution? It is my humble submission that the aforecited provision is merely a reassertion of the power of the Supreme Court as
guardian of the Constitution and protector of constitutional rights, of which, under no circumstance, could it be deprived, if our present
Constitution system is to be maintained. For it is a power constitutionally assigned to it as the essence of the high judicial power of the
Supreme Court, for the orderly and salutary apportionment of governmental powers among the different b of the government, as well as
the Constitution bodies created to deal more effectively with specific matters requiring governmental actions.
Examining the instant petition, nothing reveals itself as raising more than questions merely affecting the conduct of the election held on
April 7, 1978, much less a truly constitutional question, aside perhaps from the alegation that the COMELEC undertook an examination
of election records beyond those examined during the pendency of the controversy before the Regional Board of Canvassers, allegedly
without notice to the petitioners, thus intimating a violation of due process. This particular matter, however, can easily be disposed of by
citing the provision of Section 175 of the Electoral Code of 1978 which reads:

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

If the Commission has the power to suspend motu proprio the proclamation of a candidate-elect it must have the power to conduct
inquiry into the cause for which it ordains the suspension of the proclamation such as making its own examination of the integrity of
election returns or inquiring into any relevant matter affecting the purity of the ballot. Notice is required by the legal provision cited, but
this must be notice to the party adversely affected, the candidate-elect whose proclamation is suspended. The action taken by the
COMELEC in e additional election documents to those examined by the KB experts during the pendency of the controversy with the
Regional Board of Canvassers was, therefore, one of which petitioners cannot be heard, nor have any reason, one of which petitioners
cannot be heard, nor have any reason, to complain, for it even resulted in one KB candidate getting into the winners column. If the
COMELEC stopped at a certain point in its examination, instead of going through all those questioned by the petitioners, evidently due
to time constraint as fixed in the guidelines, set by this Court, and the character of pre-proclamation proceedings , it cannot be charged
with abuse of discretion, much less a grave one. it did not have to conduct the additional examination, in the first place. The controversy
which was heard and decided in the first instance, by the Regional Board of Canvassers, with guidelines set by this Court, was appealed
to the COMELEC. The latter's appellate authority was thus limited to a review of the decision of the Board on the basis of the evidence
presented before it, rendering its own decision on the basis of the evidence, and no more. It incorporated the result of its own
examination of additional election returns, and found one KB as one of the candidate, a fact clearly showing that COMELEC did
examine the said documents, otherwise , the result as previously declared by the Board of Canvassers with a clean sweep of the KBL
candidate would have remained unaltered.

Expounding more on the one circumstance inclining me to the theory that with the enlarged power and broadened authority of the
COMELEC which to and cover virtually the entire electoral process, as exclusively as the power of legislation is constitutionally lodged in
the law-making body, what is given to the Supreme Court as its reviewing authority over acts of the COMELEC is no more than what it
could exercise under its power of judicial inquiry with to acts of the legislative body, which is the transfer to the COMELEC of the powers
pertaining to the Electoral Tribunals and the courts under the old Constitution over election contests, it must not be hard to concede that
with the composition of the electoral tribunals in which six of the justices of the Supreme Court sit in said bodies, the Supreme Court
crowd no longer exercise any reviewing authority over the acts of the said electoral tribunals except possibly when violation of the
Constitution or constitution rights are involved. With this limited concept of this Court's authority over the defunct electoral tribunals now
applied to an equally constitutional body that the COMELEC is that took over the function of the Election Tribunal would hesitate to hold
that Supreme Court may grant the relief as in prayed for in the present petition.

If this is so under the law and the Constitution, it should also be upon consideration of public policy. The last elections were called by the
President as a test or t as to how the vital reforms and changes of political and social discipline and moral values he has instituted to
evolve a new order have affected the thinking and the attitudes of our Tribunal should be extreme caution, if not restraint, in any act on
our part that might reflect on the success or failure of that experiment intended, at the time as a big stride in the way back to
normalization. This is specially true in the field of politics where the ills of the Old Society has been most grave, because our elections
then as a democratic process, have tarnished the image of our country as a representative democracy. Except on very compelling
reasons then, which I believe do not exist in the case before Us, should we make any pronouncement that would detract on how
successful the last political exercise had been, as the first election held under the new Constitution. We must refrain from imputing to the
COMELEC which has been enlarged with fresh mandate and a bigger trust by the Constitution failure in the performance of its functions
either by willfull neglect, official incompetence, much less by deliberate partiality, in the first real test of its capability.

In the light of the foregoing, I vote, in concurrence with the majority, to dismiss the petition, first, as to the matter allegedly involving a
violation of the petitioners' right of due process on the ground that there was no denial thereof, and second, as to the other matters
involving no violation of constitutional rights, on the ground they are purely political questions, and that in any case, no grave abuse of
discretion has been committed by, much leas is there lack or excess of jurisdiction on the part of, the Commission on Elections.

Republic of the Philippines

SUPREME COURT
Manila
 EN BANC

G.R. No. 96266 July 18, 1991

ERNESTO M. MACEDA, petitioner,

vs.
ENERGY REGULATORY BOARD, CALTEX (Philippines), INC., PILIPINAS SHELL PETROLEUM CORPORATION AND PETRON
CORPORATION, respondents.

G.R. No. 96349 July 18, 1991

EUGENIO O. ORIGINAL, IRENEO N. AARON, JR., RENE LEDESMA, ROLANDO VALLE, ORLANDO MONTANO, STEVE ABITANG,
NERI JINON, WILFREDO DELEONIO, RENATO BORRO, RODRIGO DE VERA, ALVIN BAYUANG, JESUS MELENDEZ,
NUMERIANO CAJILIG JR., RUFINO DE LA CRUZ AND JOVELINO G. TIPON, petitioners,
vs.
ENERGY REGULATORY BOARD, CALTEX (Philippines), INC., PILIPINAS SHELL PETROLEUM CORPORATION AND PETRON
CORPORATION, respondents.

G.R. No. 96284 July 18,1991

CEFERINO S. PAREDES, JR., petitioner,

vs.
ENERGY REGULATORY BOARD, CALTEX (Philippines), INC., PILIPINAS SHELL, INC. AND PETROPHIL
CORPORATION, respondents.

RESOLUTION

MEDIALDEA, J.:p

In G.R. No. 96266, petitioner Maceda seeks nullification of the Energy Regulatory Board (ERB) Orders dated December 5 and 6, 1990
on the ground that the hearings conducted on the second provisional increase in oil prices did not allow him substantial cross-
examination, in effect, allegedly, a denial of due process.

The facts of the case are as follows:

Upon the outbreak of the Persian Gulf conflict on August 2, 1990, private respondents oil companies filed with the ERB their respective
applications on oil price increases (docketed as ERB Case Nos. 90-106, 90-382 and 90-384, respectively).

On September 21, 1990, the ERB issued an order granting a provisional increase of P1.42 per liter. Petitioner Maceda filed a petition for
Prohibition on September 26, 1990 (E. Maceda v. ERB, et al., G.R. No. 95203), seeking to nullify the provisional increase. We dismissed
the petition on December 18, 1990, reaffirming ERB's authority to grant provisional increase even without prior hearing, pursuant to Sec.
8 of E.O. No. 172, clarifying as follows:

What must be stressed is that while under Executive Order No. 172, a hearing is indispensable, it does not preclude
the Board from ordering, ex-parte, a provisional increase, as it did here, subject to its final disposition of whether or
not: (1) to make it permanent; (2) to reduce or increase it further; or (3) to deny the application. Section 3, paragraph
(e) is akin to a temporary restraining order or a writ of preliminary attachment issued by the courts, which are
given ex-parte and which are subject to the resolution of the main case.

Section 3, paragraph (e) and Section 8 do not negate each other, or otherwise, operate exclusively of the other, in that
the Board may resort to one but not to both at the same time. Section 3(e) outlines the jurisdiction of the Board and
the grounds for which it may decree a price adjustment, subject to the requirements of notice and hearing. Pending
that, however, it may order, under Section 8, an authority to increase provisionally, without need of a hearing, subject
to the final outcome of the proceeding. The Board, of course, is not prevented from conducting a hearing on the grant
of provisional authority-which is of course, the better procedure — however, it cannot be stigmatized later if it failed to
conduct one. (pp. 129-130, Rollo) (Emphasis supplied)

In the same order of September 21, 1990, authorizing provisional increase, the ERB set the applications for hearing with due notice to
all interested parties on October 16, 1990. Petitioner Maceda failed to appear at said hearing as well as on the second hearing on
October 17, 1990.

To afford registered oppositors the opportunity to cross-examine the witnesses, the ERB set the continuation of the hearing to October
24, 1990. This was postponed to November 5, 1990, on written notice of petitioner Maceda.

On November 5, 1990, the three oil companies filed their respective motions for leave to file or admit amended/supplemental
applications to further increase the prices of petroleum products.
The ERB admitted the respective supplemental/amended petitions on November 6, 1990 at the same time requiring applicants to
publish the corresponding Notices of Public Hearing in two newspapers of general circulation (p. 4, Rollo and Annexes "F" and "G," pp.
60 and 62, Rollo).

Hearing for the presentation of the evidence-in-chief commenced on November 21, 1990 with ERB ruling that testimonies of witnesses
were to be in the form of Affidavits (p. 6, Rollo). ERB subsequently outlined the procedure to be observed in the reception of evidence,
as follows:

CHAIRMAN FERNANDO:

Well, at the last hearing, applicant Caltex presented its evidence-in-chief and there is an understanding or it is the
Board's wish that for purposes of good order in the presentation of the evidence considering that these are being
heard together, we will defer the cross-examination of applicant Caltex's witness and ask the other applicants to
present their evidence-in-chief so that the oppositors win have a better Idea of what an of these will lead to because
as I mentioned earlier, it has been traditional and it is the intention of the Board to act on these applications on an
industry-wide basis, whether to accept, reject, modify or whatever, the Board win do it on an industry wide basis, so,
the best way to have (sic) the oppositors and the Board a clear picture of what the applicants are asking for is to have
all the evidence-in-chief to be placed on record first and then the examination will come later, the cross-examination
will come later. . . . (pp. 5-6, tsn., November 23, 1990, ERB Cases Nos. 90-106, 90382 and 90-384). (p. 162, Rollo)

Petitioner Maceda maintains that this order of proof deprived him of his right to finish his cross-examination of Petron's
witnesses and denied him his right to cross-examine each of the witnesses of Caltex and Shell. He points out that this relaxed
procedure resulted in the denial of due process.

We disagree. The Solicitor General has pointed out:

. . . The order of testimony both with respect to the examination of the particular witness and to the general course of
the trial is within the discretion of the court and the exercise of this discretion in permitting to be introduced out of the
order prescribed by the rules is not improper (88 C.J.S. 206-207).

Such a relaxed procedure is especially true in administrative bodies, such as the ERB which in matters of rate or price
fixing is considered as exercising a quasi-legislative, not quasi-judicial, function As such administrative agency, it is not
bound by the strict or technical rules of evidence governing court proceedings (Sec. 29, Public Service Act; Dickenson
v. United States, 346, U.S. 389, 98 L. ed. 132, 74 S. St. 152). (Emphasis supplied)

In fact, Section 2, Rule I of the Rules of Practice and Procedure Governing Hearings Before the ERB provides that —

These Rules shall govern pleadings, practice and procedure before the Energy Regulatory Board in all matters of
inquiry, study, hearing, investigation and/or any other proceedings within the jurisdiction of the Board. However, in the
broader interest of justice, the Board may, in any particular matter, except itself from these rules and apply such
suitable procedure as shall promote the objectives of the Order.

(pp. 163-164, Rollo)

Petitioner Maceda also claims that there is no substantial evidence on record to support the provisional relief.

We have, in G.R. Nos. 95203-05, previously taken judicial notice of matters and events related to the oil industry, as follows:

. . . (1) as of June 30, 1990, the OPSF has incurred a deficit of P6.1 Billion; (2) the exchange rate has fallen to P28.00
to $1.00; (3) the country's balance of payments is expected to reach $1 Billion; (4) our trade deficit is at P2.855 Billion
as of the first nine months of the year.

. . . (p. 150, Rollo)

The Solicitor General likewise commented:

Among the pieces of evidence considered by ERB in the grant of the contested provisional relief were: (1) certified
copies of bins of lading issued by crude oil suppliers to the private respondents; (2) reports of the Bankers Association
of the Philippines on the peso-dollar exchange rate at the BAP oil pit; and (3) OPSF status reports of the Office of
Energy Affairs. The ERB was likewise guided in the determination of international crude oil prices by traditional
authoritative sources of information on crude oil and petroleum products, such as Platt's Oilgram and Petroleum
Intelligence Weekly. (p. 158, Rollo)

Thus, We concede ERB's authority to grant the provisional increase in oil price, as We note that the Order of December 5, 1990
explicitly stated:

in the light, therefore, of the rise in crude oil importation costs, which as earlier mentioned, reached an average of
$30.3318 per barrel at $25.551/US $ in September-October 1990; the huge OPSF deficit which, as reported by the
Office of Energy Affairs, has amounted to P5.7 Billion (based on filed claims only and net of the P5 Billion OPSF) as of
September 30, 1990, and is estimated to further increase to over P10 Billion by end December 1990; the decision of
the government to discontinue subsidizing oil prices in view of inflationary pressures; the apparent inadequacy of the
proposed additional P5.1 Billion government appropriation for the OPSF and the sharp drop in the value of the peso in
 relation to the US dollar to P28/US $, this Board is left with no other recourse but to grant applicants oil companies
further relief by increasing the prices of petroleum products sold by them. (p. 161, Rollo)

Petitioner Maceda together with petitioner Original (G.R. No. 96349) also claim that the provisional increase involved amounts over and
above that sought by the petitioning oil companies.

The Solicitor General has pointed out that aside from the increase in crude oil prices, all the applications of the respondent oil
companies filed with the ERB covered claims from the OPSF.

We shall thus respect the ERB's Order of December 5, 1990 granting a provisional price increase on petroleum products premised on
the oil companies' OPSF claims, crude cost peso differentials, forex risk for a subsidy on sale to NPC (p. 167, Rollo), since the oil
companies are "entitled to as much relief as the fact alleged constituting the course of action may warrant," (Javellana v. D.O. Plaza
Enterprises, Inc., G.R. No. L-28297, March 30, 1970, 32 SCRA 261 citing Rosales v. Reyes, 25 Phil. 495; Aguilar v. Rubiato, 40 Phil.
470) as follows:

Per Liter

Weighted

Petron Shell Caltex Average

Crude Cost P3.11 P3.6047 P2.9248 P3.1523

Peso Cost

Diffn'l 2.1747 1.5203 1.5669 1.8123

Forex Risk

Fee -0.1089 -0,0719 -0.0790 -0.0896

Subsidy on

Sales to NPC 0.1955 0.0685 0.0590 0.1203

Total Price

Increase

Applied for P59.3713 P5.1216 P4.4717 P4.9954

Less: September 21 Price

Relief

Actual Price Increase P1.42

Actual Tax Reduction:

Ad Valorem Tax

(per Sept. 1, 1990

price build-up) P1.3333

Specific Tax (per

Oct. 5, 1990 price

build-up) .6264 .7069 2.1269

Net Price Increase

Applied for 2.8685

Nonetheless, it is relevant to point out that on December 10, 1990, the ERB, in response to the President's appeal, brought back the
increases in Premium and Regular gasoline to the levels mandated by the December 5, 1990 Order (P6.9600 and P6.3900,
respectively), as follows:
 Product In Pesos Per Liter

OPSF

Premium Gasoline 6.9600

Regular Gasoline 6.3900

Avturbo 4.9950

Kerosene 1.4100

Diesel Oil 1.4100

Fuel Oil/Feedstock 0.2405

LPG 1.2200

Asphalt 2.5000

Thinner 2.5000

In G.R. No. 96349, petitioner Original additionally claims that if the price increase will be used to augment the OPSF this will constitute
illegal taxation. In the Maceda case, (G.R. Nos. 95203-05, supra) this Court has already ruled that "the Board Order authorizing the
proceeds generated by the increase to be deposited to the OPSF is not an act of taxation but is authorized by Presidential Decree No.
1956, as amended by Executive Order No. 137.

The petitions of E.O. Original et al. (G.R. No. 96349) and C.S. Povedas, Jr. (G.R. No. 96284), insofar as they question the ERB's
authority under Sec. 8 of E.O. 172, have become moot and academic.

We lament Our helplessness over this second provisional increase in oil price. We have stated that this "is a question best judged by the
political leadership" (G.R. Nos. 95203-05, G.R. Nos. 95119-21, supra). We wish to reiterate Our previous pronouncements therein that
while the government is able to justify a provisional increase, these findings "are not final, and it is up to petitioners to demonstrate that
the present economic picture does not warrant a permanent increase."

In this regard, We also note the Solicitor General's comments that "the ERB is not averse to the idea of a presidential review of its
decision," except that there is no law at present authorizing the same. Perhaps, as pointed out by Justice Padilla, our lawmakers may
see the wisdom of allowing presidential review of the decisions of the ERB since, despite its being a quasi-judicial body, it is still "an
administrative body under the Office of the President whose decisions should be appealed to the President under the established
principle of exhaustion of administrative remedies," especially on a matter as transcendental as oil price increases which affect the lives
of almost an Filipinos.

ACCORDINGLY, the petitions are hereby DISMISSED.

SO ORDERED.

Narvasa, Melencio-Herrera, Feliciano, Gancayco, Bidin, Griño-Aquino and Regalado, JJ., concur.

Davide, J., concurs in the result.

Fernan, C.J., took no part.

Separate Opinions

PARAS, J., dissenting:

I dissent. As I have long previously indicated, the ERB has absolutely no power to tax which is solely the prerogative of Congress. This
is what the ERB is precisely doing by getting money from the people to ultimately subsidize the ravenous oil companies. Additionally, the
stubborn refusal of the ERB to effectively rollback oil prices is a continuing bestial insult to the intelligence of our countrymen, and a
gross abandonment of the people in their hour of economic misery. I therefore vote for a complete and effective rollback of all oil prices.

Cruz, J., concurs.

PADILLA, J., dissenting:

I regret that I can not concur in the majority opinion.

In the matter of price increases of oil products, which vitally affects the people, especially those in the middle and low income groups,
any increase, provisional or otherwise, should be allowed only after the Energy Regulatory Board (ERB) shall have fully determined,
through bona fide and full-dress hearings, that it is absolutely necessary and by how much it shall be effected. The people, represented
by reputable oppositors, deserve to be given full opportunity to be heard in their opposition to any increase in the prices of fuel. The right
to be heard includes not only the right to present one's case and submit evidence in support thereof, but also the right to confront and
cross-examine the witnesses of the adverse parties.

Because of the procedure adopted by the ERB in the reception of evidence leading to the price increases of 5 and 6 December 1990,
petitioner Maceda was not able to finish his cross-examination of Petron's sole witness. And, even before each of the witnesses of Shell
and Caltex could be cross-examined by petitioners and before they could present evidence in support of their opposition to the increase,
the ERB had already issued its 5 December 1990 order allowing a "provisional increase" sought by the oil companies in their respective
supplemental applications.

That there were postponements of scheduled hearings before the ERB, at the instance of oppositor Maceda, did not justify a denial of
the right of oppositors to be heard. The postponements were not intended to delay the proceedings. In fact, the resetting of the
scheduled hearings on November 14, 15 and 16 to a later date, upon motion of petitioner Maceda, was to enable him to file a written
opposition to the supplemental applications filed by the oil companies.

The ERB acted hastily in granting the provisional increases sought by the oil companies even before the oppositors could submit
evidence in support of their opposition. The fact that the questioned orders merely allowed a provisional increase is beside the point, for
past experiences have shown that so-called provisional increases" allowed by the ERB ultimately became permanent.

ERB's claim that the second provisional increase was duly supported by evidence, is belied by its own act of modifying said order (of
provisional increase) not only once but twice, upon the "request" of the President. First, the ERB rolled back the prices of fuel just a day
after it issued the questioned order, altering the allocation of the increase. Second, on 10 December 1990, the ERB further modified the
price of petroleum products resulting in reduction of the weighted average provisional increase from P2.82 to P2.05 per liter, but only
after the President had announced that she would meet with the leaders of both Houses of Congress, to discuss the creation of a
special fund to be raised from additional taxes, to subsidize the prices of petroleum products. 1

These acts of the ERB ostensibly sparked by "presidential requests" clearly demonstrate that the evidence did not, in the first place,
justify the price increases it had ordered on 5 and 6 December 1990. Furthermore, the ERB never came out with a categorical and
official declaration of how much was the so-called deficit of the Oil Price Stabilization Fund (OPSF) and how much of the oil price
increases was intended to cover such deficit.

In the midst of a national crisis related to oil price increases, each and every one is called upon to assume his/its share of continuing
sacrifices. The public, the government, as well as the oil companies should work hand in hand in solving the present problem that
confronts us. We are not unmindful of the fact that the oil companies are profit-oriented. However, profits should not be their only
concern in times of deepening inability of the people to cope with their prices with "built-in-margins". A reduction of profits during these
crucial and trying times, is certainly in order considering that in the past, the oil companies had unquestionably made tremendous profits.

In view of the foregoing, I vote to GRANT the petition for the nullification of the 5 and 6 December 1990 orders of the ERB and for a roll-
back of the prices of oil products to levels existing before 5 and 6 December 1990 until hearings before the ERB are finally concluded.

Before closing, I also would like to submit for congressional consideration two (2) proposals in the public interest. They are:

(1) to do away with the present scheme of allowing provisional price increases of oil products. This scheme, to my mind, is misleading
and serves as an excuse for unilateral and arbitrary ERB-action. As already noted, these provisional price increases are, to all intents
and purposes, permanent when fixed. To that extent, the scheme is a fraud on the people.

(2) all decisions and orders of the ERB should be expressly made appealable by statute to the President of the Philippines whose
decisions shall be final, except in cases involving questions of law or grave abuse of discretion which may be elevated to the Supreme
Court in a special civil action for certiorari under Rule 65 of the Rules of Court.

While at present, decisions and orders of the ERB are, in my considered opinion, appealable to the President under the principle of
"exhaustion of administrative remedies", it is nevertheless desirable that the appealability of ERB decisions and orders to the President
be placed beyond any and all doubts. In this way, the President of the Philippines has to assume full responsibility for all price increases
in oil products, which should be the case because the matter involved is not only one of national interest but profoundly one of people's
survival.

Gutierrez, Jr. and Cruz, JJ., concur.

SARMIENTO, J., separate opinion:

I would like to point out a few things in view of the majority's reliance on the first Maceda case. 1

The first Maceda case was a challenge on provisional oil price increases decreed by the Energy Regulatory Board (ERB). This Court
sustained the Board, as it is sustaining the Board in this case, on a few economic outputs, namely, the Oil Price Stabilization Fund
(OPSF) deficit, the deteriorating exchange rate, and the balance of payments and trade gaps.
As I held in my dissent in yet another Maceda case, Maceda v. Macaraig, 2 the current oil price increases were (are) also the result of
the devaluation of the currency, since a devalued peso forced oil companies to pay more pesos for oil worth in dollars.

I simply wish to state what has apparently been left unstated in the course of debate and perhaps, the real score behind recurring oil
price hikes and why the ERB has been very quick in granting them.

The truth is that petroleum prices have been dictated by the Government's economic maneuvers, and not rather the vagaries of the
world market. The truth is that the recent oil hikes have nothing to do with Saddam Hussein or the Gulf crisis (during which oil prices in
fact dropped) and are, rather, the natural consequences of calculated moves by the Government in its effort to meet so-called
International Monetary Fund (IMF) targets.

In 1989, the Government of the Republic of the Philippines submitted its letter of intent to the IMF outlining the country's economic
program from 1989 through 1992. In its paragraph 19, it states that:

The Government intends to continue with the floating exchange rate system established in October 1984 . . . 3

Since exchange control was abolished and the floating rate system was established, the Philippine peso has seen a series of
devaluations that have progressively pushed up prices, significantly, prices of petroleum. According to one authority, devaluation has
been a "standard prescription" to correct balance of payments (BOP) deficits. 4 It makes dollars expensive, discourages import and
encourages exports, and forces dollars conservation. 5

It is a matter of opinion whether or not devaluation has been good for the country and whether or not it has realized these objectives.
The truth is that, whatever it has accomplished, oil — which is imported — has been subject to the effects of devaluation.

Early this year, Governor Jose Cuisia of the Central Bank, Secretary Jesus Estanislao of the Department of Finance, and Secretary
Guillermo Carague of the Budget and Management Department, wrote Mr. Michael Camdessus of the International Monetary Fund (the
letter of intent) and informed him of the country's "Economic Stabilization Plan, 1991-92". The Plan recognized certain economic
imbalances that have supposedly inhibited growth, in particular, inflation and an increasing balance of payments deficit, and drew a
program centered on "a strong effort to bring down the overall fiscal deficit "through, among other things, "the gradual elimination of the
deficit of the Oil Price Stabilization Fund." 6 It spelled out, among other things, a "[r]estoration of a sustainable external position
requir[ing] the continuation of a flexible exchange rate policy . . . " 7 and described in detail an "Oil Price and Energy Policy" focused on
wiping out the OPSF deficit, to wit:

xxx xxx xxx

A substantial erosion in the overall fiscal position occurred in 1989 and 1990 as a result of official price support for oil
products provided through the OPSF. Despite a lowering of the excise tax on oil in September 1990 and average
domestic oil price increases of about 30 percent in September and 32 percent in December 1990, the fund continued
to incur a deficit during the second half of 1990. The cumulative OPSF deficit (excluding unfiled claims) at end
December 1990 is estimated at P8.8 billion, and this deficit will rise in the first part of 1991. However the cumulative
OPSF deficit is to be eliminated by the end of the third quarter of 1991. To this end, the Government intends to follow
a pricing policy that ensures attainment of zero balance within the specific time. In particular, the Government will
maintain present price levels despite projected world price declines. In addition, a budgetary transfer of P5 billion will
be provided in 1991 to settle outstanding claim of the OPSF.

15. Full deregulation of oil prices continues to be an important objective of the Government once calm has been
restored to world oil markets. Meanwhile the technical and legal groundwork is being laid with a view to full
deregulation as soon as practicable.

16. The principal objectives of the Government's policy in the energy sector are: (i) the development of economically
viable indigenous energy resources, mainly thermal, geothermal and hydro-electric power, together with ensuring
adequate maintenance of existing facilities; (ii) promoting more efficient use of energy resources through various
energy conservation measures; and (ii) the elimination of distortions in every resource allocation through appropriate
pricing policies. 8

xxx xxx xxx

As I said, Philippine oil prices today have nothing to do with the law on supply and demand, if they had anything to do with it in recent
years. (I also gather that the Government is intending to re-adjust the prices of gasoline and diesel fuel soon since apparently, low diesel
prices have reduced the demand for gasoline resulting in "distortions".)

As the Court held in the first Maceda v. Energy Regulatory Board, 9 oil pricing "is a question best judged by the political leadership" and
oil prices are (and have been apparently), political, rather than economic, decisions.

I am not to be mistaken as accepting the "letter of intent" as a correct prescription –– much less a necessary medicine — although I will
be lacking in candor if I did not say that it is a bitter pill to swallow. What I must be understood as saying is that "oil" is a political card to
be played on a political board rather than the courts, so long, of course, as nobody has done anything illegal.

The "politics of oil" as spelled out in the Government's letter of intent likewise bring to light the true nature of the ERB Under the
Memorandum on Philippine Economic Stabilization Plan:

xxx xxx xxx

 In the past, energy prices had been set to broadly reflect the average cost of supply. However, the lack of
transparency of the pricing mechanism and subsidization of consumption have increasingly become a cause for
concern. To alleviate some of these problems, in mid-1987, the Government established the Energy Regulatory Board
ERB a quasi-judicial body empowered with the setting and regulation of the pricing of petroleum products and
electricity tariffs, the regulation of additions to oil refining capacity, and the regulation of importing, transporting,
processing and distributing all energy resources. (Petroleum pricing policy is described in paragraphs 14 and 15.) In
addition to the full pass-through of changes in oil prices to power tariffs, the Government is committed to the adoption
of longrun marginal cost pricing for electricity. To this end, NPC intends to introduce a marginal cost imported-has tariff
structure to ensure that it meets its target of achieving a rate of return of eight percent on its rate base. 10

it is apparent that the Board, in spite of its "independence" (from the Office of the President), is bound by the terms of the program and
that it has after all, no genuine discretion to deny requests for price adjustments by oil companies. I seriously doubt whether or not it is
possessed of that discretion judging, first, from its performance since 1987 (in which it has not overruled the Government on "oil cases")
and the fact that the exchange rate, the balance of payment deficit, and the OPSF deficiency are matters of simple arithmetic.

And certainly, the Board can not possibly overrule the Government's "letter of intent."

The first Maceda case sustained the grant of provisional price increases ex parte not only because Section 8 of Executive Order No. 172
authorized the grant of provisional relief without a hearing but because fluctuations in the foreign exchange rates, for instance, were, and
are, a matter of judicial notice, and a hearing thereafter was necessary only to see whether or not the ERB determined the rates
correctly.

This likewise brings to light the necessity for an ERB to fix rates since it does not, after all fix (meaning decide) rates but merely
announces their imminence on demonstrable figures of higher rates. The Court however can not question the wisdom of a statute and
after all, I suppose the Government can make use of an accountant.

I agree with Justice Padilla insofar as he refers to the "present scheme of allowing provisional price increase" as a "scheme [to defraud]
the people." I would like to go further. As I indicated the ERB does no more than to punch calculators for the Government-which decides
oil price increases. The comedy of December, 1990, when the Board adjusted prices in a matter of days, is a confirmation of this point.
As Justice Padilla noted, the re-adjustment of December 10, 1990 was in fact prompted by "presidential requests" which does not speak
well of the Board's independence and which in fact bares the truth as to who really makes the decision. (The readjustment, consisting in
the reduction in diesel fuel and a corresponding increase in gasoline, sought to mollify the indignation of the public.)

I agree with Justice Padilla that it amounts to fraud on the people to make them believe that the ERB can give them a fair hearing,
indeed, if it can do anything at all.

I agree, finally, with Justice Padilla that the nation is one in crisis, and evidently, the "ravenous" oil companies Justice Paras refers to,
have not helped any. I submit however that we have not succeeded in fingering the real villain the letter of intent. Saddam's Middle East
folly has nothing to do with that.

Separate Opinions

PARAS, J., dissenting:

I dissent. As I have long previously indicated, the ERB has absolutely no power to tax which is solely the prerogative of Congress. This
is what the ERB is precisely doing by getting money from the people to ultimately subsidize the ravenous oil companies. Additionally, the
stubborn refusal of the ERB to effectively rollback oil prices is a continuing bestial insult to the intelligence of our countrymen, and a
gross abandonment of the people in their hour of economic misery. I therefore vote for a complete and effective rollback of all oil prices.

Cruz, J., concurs.

PADILLA, J., dissenting:

I regret that I can not concur in the majority opinion.

In the matter of price increases of oil products, which vitally affects the people, especially those in the middle and low income groups,
any increase, provisional or otherwise, should be allowed only after the Energy Regulatory Board (ERB) shall have fully determined,
through bona fide and full-dress hearings, that it is absolutely necessary and by how much it shall be effected. The people, represented
by reputable oppositors, deserve to be given full opportunity to be heard in their opposition to any increase in the prices of fuel. The right
to be heard includes not only the right to present one's case and submit evidence in support thereof, but also the right to confront and
cross-examine the witnesses of the adverse parties.

Because of the procedure adopted by the ERB in the reception of evidence leading to the price increases of 5 and 6 December 1990,
petitioner Maceda was not able to finish his cross-examination of Petron's sole witness. And, even before each of the witnesses of Shell
and Caltex could be cross-examined by petitioners and before they could present evidence in support of their opposition to the increase,
the ERB had already issued its 5 December 1990 order allowing a "provisional increase" sought by the oil companies in their respective
supplemental applications.

That there were postponements of scheduled hearings before the ERB, at the instance of oppositor Maceda, did not justify a denial of
the right of oppositors to be heard. The postponements were not intended to delay the proceedings. In fact, the resetting of the
scheduled hearings on November 14, 15 and 16 to a later date, upon motion of petitioner Maceda, was to enable him to file a written
opposition to the supplemental applications filed by the oil companies.

The ERB acted hastily in granting the provisional increases sought by the oil companies even before the oppositors could submit
evidence in support of their opposition. The fact that the questioned orders merely allowed a provisional increase is beside the point, for
past experiences have shown that so-called provisional increases" allowed by the ERB ultimately became permanent.

ERB's claim that the second provisional increase was duly supported by evidence, is belied by its own act of modifying said order (of
provisional increase) not only once but twice, upon the "request" of the President. First, the ERB rolled back the prices of fuel just a day
after it issued the questioned order, altering the allocation of the increase. Second, on 10 December 1990, the ERB further modified the
price of petroleum products resulting in reduction of the weighted average provisional increase from P2.82 to P2.05 per liter, but only
after the President had announced that she would meet with the leaders of both Houses of Congress, to discuss the creation of a
special fund to be raised from additional taxes, to subsidize the prices of petroleum products. 1

These acts of the ERB ostensibly sparked by "presidential requests" clearly demonstrate that the evidence did not, in the first place,
justify the price increases it had ordered on 5 and 6 December 1990. Furthermore, the ERB never came out with a categorical and
official declaration of how much was the so-called deficit of the Oil Price Stabilization Fund (OPSF) and how much of the oil price
increases was intended to cover such deficit.

In the midst of a national crisis related to oil price increases, each and every one is called upon to assume his/its share of continuing
sacrifices. The public, the government, as well as the oil companies should work hand in hand in solving the present problem that
confronts us. We are not unmindful of the fact that the oil companies are profit-oriented. However, profits should not be their only
concern in times of deepening inability of the people to cope with their prices with "built-in-margins". A reduction of profits during these
crucial and trying times, is certainly in order considering that in the past, the oil companies had unquestionably made tremendous profits.

In view of the foregoing, I vote to GRANT the petition for the nullification of the 5 and 6 December 1990 orders of the ERB and for a roll-
back of the prices of oil products to levels existing before 5 and 6 December 1990 until hearings before the ERB are finally concluded.

Before closing, I also would like to submit for congressional consideration two (2) proposals in the public interest. They are:

(1) to do away with the present scheme of allowing provisional price increases of oil products. This scheme, to my mind, is misleading
and serves as an excuse for unilateral and arbitrary ERB-action. As already noted, these provisional price increases are, to all intents
and purposes, permanent when fixed. To that extent, the scheme is a fraud on the people.

(2) all decisions and orders of the ERB should be expressly made appealable by statute to the President of the Philippines whose
decisions shall be final, except in cases involving questions of law or grave abuse of discretion which may be elevated to the Supreme
Court in a special civil action for certiorari under Rule 65 of the Rules of Court.

While at present, decisions and orders of the ERB are, in my considered opinion, appealable to the President under the principle of
"exhaustion of administrative remedies", it is nevertheless desirable that the appealability of ERB decisions and orders to the President
be placed beyond any and all doubts. In this way, the President of the Philippines has to assume full responsibility for all price increases
in oil products, which should be the case because the matter involved is not only one of national interest but profoundly one of people's
survival.

Gutierrez, Jr. and Cruz, JJ., concur.

SARMIENTO, J., separate opinion:

I would like to point out a few things in view of the majority's reliance on the first Maceda case. 1

The first Maceda case was a challenge on provisional oil price increases decreed by the Energy Regulatory Board (ERB). This Court
sustained the Board, as it is sustaining the Board in this case, on a few economic outputs, namely, the Oil Price Stabilization Fund
(OPSF) deficit, the deteriorating exchange rate, and the balance of payments and trade gaps.

As I held in my dissent in yet another Maceda case, Maceda v. Macaraig, 2 the current oil price increases were (are) also the result of
the devaluation of the currency, since a devalued peso forced oil companies to pay more pesos for oil worth in dollars.

I simply wish to state what has apparently been left unstated in the course of debate and perhaps, the real score behind recurring oil
price hikes and why the ERB has been very quick in granting them.

The truth is that petroleum prices have been dictated by the Government's economic maneuvers, and not rather the vagaries of the
world market. The truth is that the recent oil hikes have nothing to do with Saddam Hussein or the Gulf crisis (during which oil prices in
fact dropped) and are, rather, the natural consequences of calculated moves by the Government in its effort to meet so-called
International Monetary Fund (IMF) targets.

In 1989, the Government of the Republic of the Philippines submitted its letter of intent to the IMF outlining the country's economic
program from 1989 through 1992. In its paragraph 19, it states that:

The Government intends to continue with the floating exchange rate system established in October 1984 . . . 3
Since exchange control was abolished and the floating rate system was established, the Philippine peso has seen a series of
devaluations that have progressively pushed up prices, significantly, prices of petroleum. According to one authority, devaluation has
been a "standard prescription" to correct balance of payments (BOP) deficits. 4 It makes dollars expensive, discourages import and
encourages exports, and forces dollars conservation. 5

It is a matter of opinion whether or not devaluation has been good for the country and whether or not it has realized these objectives.
The truth is that, whatever it has accomplished, oil — which is imported — has been subject to the effects of devaluation.

Early this year, Governor Jose Cuisia of the Central Bank, Secretary Jesus Estanislao of the Department of Finance, and Secretary
Guillermo Carague of the Budget and Management Department, wrote Mr. Michael Camdessus of the International Monetary Fund (the
letter of intent) and informed him of the country's "Economic Stabilization Plan, 1991-92". The Plan recognized certain economic
imbalances that have supposedly inhibited growth, in particular, inflation and an increasing balance of payments deficit, and drew a
program centered on "a strong effort to bring down the overall fiscal deficit "through, among other things, "the gradual elimination of the
deficit of the Oil Price Stabilization Fund." 6 It spelled out, among other things, a "[r]estoration of a sustainable external position
requir[ing] the continuation of a flexible exchange rate policy . . . " 7 and described in detail an "Oil Price and Energy Policy" focused on
wiping out the OPSF deficit, to wit:

xxx xxx xxx

A substantial erosion in the overall fiscal position occurred in 1989 and 1990 as a result of official price support for oil
products provided through the OPSF. Despite a lowering of the excise tax on oil in September 1990 and average
domestic oil price increases of about 30 percent in September and 32 percent in December 1990, the fund continued
to incur a deficit during the second half of 1990. The cumulative OPSF deficit (excluding unfiled claims) at end
December 1990 is estimated at P8.8 billion, and this deficit will rise in the first part of 1991. However the cumulative
OPSF deficit is to be eliminated by the end of the third quarter of 1991. To this end, the Government intends to follow
a pricing policy that ensures attainment of zero balance within the specific time. In particular, the Government will
maintain present price levels despite projected world price declines. In addition, a budgetary transfer of P5 billion will
be provided in 1991 to settle outstanding claim of the OPSF.

15. Full deregulation of oil prices continues to be an important objective of the Government once calm has been
restored to world oil markets. Meanwhile the technical and legal groundwork is being laid with a view to full
deregulation as soon as practicable.

16. The principal objectives of the Government's policy in the energy sector are: (i) the development of economically
viable indigenous energy resources, mainly thermal, geothermal and hydro-electric power, together with ensuring
adequate maintenance of existing facilities; (ii) promoting more efficient use of energy resources through various
energy conservation measures; and (ii) the elimination of distortions in every resource allocation through appropriate
pricing policies. 8

xxx xxx xxx

As I said, Philippine oil prices today have nothing to do with the law on supply and demand, if they had anything to do with it in recent
years. (I also gather that the Government is intending to re-adjust the prices of gasoline and diesel fuel soon since apparently, low diesel
prices have reduced the demand for gasoline resulting in "distortions".)

As the Court held in the first Maceda v. Energy Regulatory Board, 9 oil pricing "is a question best judged by the political leadership" and
oil prices are (and have been apparently), political, rather than economic, decisions.

I am not to be mistaken as accepting the "letter of intent" as a correct prescription –– much less a necessary medicine — although I will
be lacking in candor if I did not say that it is a bitter pill to swallow. What I must be understood as saying is that "oil" is a political card to
be played on a political board rather than the courts, so long, of course, as nobody has done anything illegal.

The "politics of oil" as spelled out in the Government's letter of intent likewise bring to light the true nature of the ERB Under the
Memorandum on Philippine Economic Stabilization Plan:

xxx xxx xxx

In the past, energy prices had been set to broadly reflect the average cost of supply. However, the lack of
transparency of the pricing mechanism and subsidization of consumption have increasingly become a cause for
concern. To alleviate some of these problems, in mid-1987, the Government established the Energy Regulatory Board
ERB a quasi-judicial body empowered with the setting and regulation of the pricing of petroleum products and
electricity tariffs, the regulation of additions to oil refining capacity, and the regulation of importing, transporting,
processing and distributing all energy resources. (Petroleum pricing policy is described in paragraphs 14 and 15.) In
addition to the full pass-through of changes in oil prices to power tariffs, the Government is committed to the adoption
of longrun marginal cost pricing for electricity. To this end, NPC intends to introduce a marginal cost imported-has tariff
structure to ensure that it meets its target of achieving a rate of return of eight percent on its rate base. 10

it is apparent that the Board, in spite of its "independence" (from the Office of the President), is bound by the terms of the program and
that it has after all, no genuine discretion to deny requests for price adjustments by oil companies. I seriously doubt whether or not it is
possessed of that discretion judging, first, from its performance since 1987 (in which it has not overruled the Government on "oil cases")
and the fact that the exchange rate, the balance of payment deficit, and the OPSF deficiency are matters of simple arithmetic.

And certainly, the Board can not possibly overrule the Government's "letter of intent."
The first Maceda case sustained the grant of provisional price increases ex parte not only because Section 8 of Executive Order No. 172
authorized the grant of provisional relief without a hearing but because fluctuations in the foreign exchange rates, for instance, were, and
are, a matter of judicial notice, and a hearing thereafter was necessary only to see whether or not the ERB determined the rates
correctly.

This likewise brings to light the necessity for an ERB to fix rates since it does not, after all fix (meaning decide) rates but merely
announces their imminence on demonstrable figures of higher rates. The Court however can not question the wisdom of a statute and
after all, I suppose the Government can make use of an accountant.

I agree with Justice Padilla insofar as he refers to the "present scheme of allowing provisional price increase" as a "scheme [to defraud]
the people." I would like to go further. As I indicated the ERB does no more than to punch calculators for the Government-which decides
oil price increases. The comedy of December, 1990, when the Board adjusted prices in a matter of days, is a confirmation of this point.
As Justice Padilla noted, the re-adjustment of December 10, 1990 was in fact prompted by "presidential requests" which does not speak
well of the Board's independence and which in fact bares the truth as to who really makes the decision. (The readjustment, consisting in
the reduction in diesel fuel and a corresponding increase in gasoline, sought to mollify the indignation of the public.)

I agree with Justice Padilla that it amounts to fraud on the people to make them believe that the ERB can give them a fair hearing,
indeed, if it can do anything at all.

I agree, finally, with Justice Padilla that the nation is one in crisis, and evidently, the "ravenous" oil companies Justice Paras refers to,
have not helped any. I submit however that we have not succeeded in fingering the real villain the letter of intent. Saddam's Middle East
folly has nothing to do with that.
 FIRST DIVISION

[G.R. No. 86695. September 3, 1992.]

MARIA ELENA MALAGA, doing business under the name B.E. CONSTRUCTION; JOSIELEEN NAJARRO, doing business under
the name BEST BUILT CONSTRUCTION; JOSE N. OCCEÑA, doing business under the name THE FIRM OF JOSE N. OCCEÑA;
and the ILOILO BUILDERS CORPORATION, Petitioners, v. MANUEL R. PENACHOS, JR., ALFREDO MATANGGA, ENRICO TICAR
AND TERESITA VILLANUEVA, in their respective capacities as Chairman and Members of the Pre-qualification Bids and
Awards Committee (PBAC)-BENIGNO PANISTANTE, in his capacity as President of Iloilo State College of Fisheries, as well as
in their respective personal capacities; and HON. LODRIGIO L. LEBAQUIN, Respondents.

Salas, Villareal & Velasco, for Petitioners.

Virgilio A. Sindico for Respondents.

SYLLABUS

1. ADMINISTRATIVE LAW; GOVERNMENT INSTRUMENTALITY, DEFINED. — The 1987 Administrative Code defines a government
instrumentality as follows: Instrumentality refers to any agency of the National Government, not integrated within the department
framework, vested with special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special
funds, and enjoying operational autonomy, usually through a charter. This term includes regulatory agencies, chartered institutions, and
government-owned or controlled corporations. (Sec. 2 (5) Introductory Provisions).

2. ID.; CHARTERED INSTITUTION; DEFINED; APPLICATION IN CASE AT BAR. — The 1987 Administrative Code describes a
chartered institution thus: Chartered institution — refers to any agency organized or operating under a special charter, and vested by law
with functions relating to specific constitutional policies or objectives. This term includes the state universities and colleges, and the
monetary authority of the state. (Sec. 2 (12) Introductory Provisions). It is clear from the above definitions that ISCOF is a chartered
institution and is therefore covered by P.D. 1818. There are also indications in its charter that ISCOF is a government instrumentality.
First, it was created in pursuance of the integrated fisheries development policy of the State, a priority program of the government to
effect the socio-economic life of the nation. Second, the Treasurer of the Republic of the Philippines shall also be the ex-officio Treasurer
of the state college with its accounts and expenses to be audited by the Commission on Audit or its duly authorized representative.
Third, heads of bureaus and offices of the National Government are authorized to loan or transfer to it, upon request of the president of
the state college, such apparatus, equipment, or supplies and even the services of such employees as can be spared without serious
detriment to public service. Lastly, an additional amount of P1.5M had been appropriated out of the funds of the National Treasury and it
was also decreed in its charter that the funds and maintenance of the state college would henceforth be included in the General
Appropriations Law. (Presidential Decree No. 1523)

3. ID.; PROHIBITION OF ANY COURT FROM ISSUING INJUNCTION IN CASES INVOLVING INFRASTRUCTURE PROJECTS OF
GOVERNMENT (P.D. 1818); POWER OF THE COURTS TO RESTRAIN APPLICATION. — In the case of Datiles and Co. v. Sucaldito,
(186 SCRA 704) this Court interpreted a similar prohibition contained in P.D. 605, the law after which P.D. 1818 was patterned. It was
there declared that the prohibition pertained to the issuance of injunctions or restraining orders by courts against administrative acts in
controversies involving facts or the exercise of discretion in technical cases. The Court observed that to allow the courts to judge these
matters would disturb the smooth functioning of the administrative machinery. Justice Teodoro Padilla made it clear, however, that on
issues definitely outside of this dimension and involving questions of law, courts could not be prevented by P.D. No. 605 from exercising
their power to restrain or prohibit administrative acts. We see no reason why the above ruling should not apply to P.D. 1818. There are at
least two irregularities committed by PBAC that justified injunction of the bidding and the award of the project.

4. ID.; POLICIES AND GUIDELINES PRESCRIBED FOR GOVERNMENT INFRASTRUCTURE (PD 1594); RULES IMPLEMENTING
THEREOF, NOT SUFFICIENTLY COMPLIED WITH IN CASE AT BAR. — Under the Rules Implementing P.D. 1594, prescribing policies
and guidelines for government infrastructure contracts, PBAC shall provide prospective bidders with the Notice to Pre-qualification and
other relevant information regarding the proposed work. Prospective contractors shall be required to file their ARC-Contractors
Confidential Application for Registration & Classifications & the PRE-C2 Confidential Pre-qualification Statement for the Project (prior to
the amendment of the rules, this was referred to as Pre-C1) not later than the deadline set in the published Invitation to Bid, after which
date no PRE-C2 shall be submitted and received. Invitations to Bid shall be advertised for at least three times within a reasonable period
but in no case less than two weeks in at least two newspapers of general circulations. (IB 13 1.2-19, Implementing Rules and
Regulations of P.D. 1594 as amended) PBAC advertised the pre-qualification deadline as December 2, 1988, without stating the hour
thereof, and announced that the opening of bids would be at 3 o’clock in the afternoon of December 12, 1988. This scheduled was
changed and a notice of such change was merely posted at the ISCOF bulletin board. The notice advanced the cut-off time for the
submission of pre-qualification documents to 10 o’clock in the morning of December 2, 1988, and the opening of bids to 1 o’clock in the
afternoon of December 12, 1988. The new schedule caused the pre-disqualification of the petitioners as recorded in the minutes of the
PBAC meeting held on December 6, 1988. While it may be true that there were fourteen contractors who were pre-qualified despite the
change in schedule, this fact did not cure the defect of the irregular notice. Notably, the petitioners were disqualified because they failed
to meet the new deadline and not because of their expired licenses. (B.E. & Best Built’s licenses were valid until June 30, 1989. [Ex. P &
O respectively: both were marked on December 28, 1988]) We have held that where the law requires a previous advertisement before
government contracts can be awarded, non-compliance with the requirement will, as a general rule, render the same void and of no
effect. (Caltex Phil. v. Delgado Bros., 96 Phil. 368) The fact that an invitation for bids has been communicated to a number of possible
bidders is not necessarily sufficient to establish compliance with the requirements of the law if it is shown that other possible bidders
have not been similarly notified.
5. ID.; ID.; ID.; PURPOSE THEREOF; CASE AT BAR. — The purpose of the rules implementing P.D. 1594 is to secure competitive
bidding and to prevent favoritism, collusion and fraud in the award of these contracts to the detriment of the public. This purpose was
defeated by the irregularities committed by PBAC. It has been held that the three principles in public bidding are the offer to the public,
an opportunity for competition and a basis for exact comparison of bids. A regulation of the matter which excludes any of these factors
destroys the distinctive character of the system and thwarts the purpose of its adoption. (Hannan v. Board of Education, 25 Okla. 372) In
the case at bar, it was the lack of proper notice regarding the pre-qualification requirement and the bidding that caused the elimination of
petitioners B.E. and Best Built. It was not because of their expired licenses, as private respondents now claim. Moreover, the plans and
specifications which are the contractors’ guide to an intelligent bid, were not issued on time, thus defeating the guaranty that contractors
be placed on equal footing when they submit their bids. The purpose of competitive bidding is negated if some contractors are informed
ahead of their rivals of the plans and specifications that are to be the subject of their bids.

6. ID.; ID.; ID.; EFFECT OF NON-COMPLIANCE THEREOF. — It has been held in a long line of cases that a contract granted without
the competitive bidding required by law is void, and the party to whom it is awarded cannot benefit from it. It has not been shown that the
irregularities committed by PBAC were induced by or participated in by any of the contractors. Hence, liability shall attach only to the
private respondents for the prejudice sustained by the petitioners as a result of the anomalies described above.

7. CIVIL LAW; NOMINAL DAMAGES; AWARD THEREOF, WHEN AVAILABLE. — As there is no evidence of the actual loss suffered by
the petitioners, compensatory damage may not be awarded to them. Moral damages do not appear to be due either. Even so, the Court
cannot close its eyes to the evident bad faith that characterized the conduct of the private respondents, including the irregularities in the
announcement of the bidding and their efforts to persuade the ISCOF president to award the project after two days from receipt of the
restraining order and before they moved to lift such order. For such questionable acts, they are liable in nominal damages at least in
accordance with Article 2221 of the Civil Code, which states: Art. 2221. Nominal damages are adjudicated in order that a right of the
plaintiff, which has been violated or invaded by the defendant may be vindicated or, recognized, and not for the purpose of indemnifying
the plaintiff for any loss suffered by him. These damages are to be assessed against the private respondents in the amount of
P10,000.00 each, to be paid separately for each of petitioners B.E. Construction and Best Built Construction.

DECISION

CRUZ, J.:

This controversy involves the extent and applicability of P.D. 1818, which prohibits any court from issuing injunctions in cases involving
infrastructure projects of the government.chanrobles.com.ph : virtual law library

The facts are not disputed.

The Iloilo State College of Fisheries (henceforth ISCOF) through its Pre-qualification, Bids and Awards Committee (henceforth PBAC)
caused the publication in the November 25, 26, 28, 1988 issues of the Western Visayas Daily an Invitation to Bid for the construction of
the Micro Laboratory Building at ISCOF. The notice announced that the last day for the submission of pre-qualification requirements
(PRE C-1) ** was December 2, 1988, and that the bids would be received and opened on December 12, 1988, 3 o’clock in the
afternoon. 1

Petitioners Maria Elena Malaga and Josieleen Najarro, respectively doing business under the name of the B.E. Construction and Best
Built Construction, submitted their pre-qualification documents at two o’clock in the afternoon of December 2, 1988. Petitioner Jose
Occeña submitted his own PRE-C1 on December 5, 1988. All three of them were not allowed to participate in the bidding because their
documents were considered late, having been submitted after the cut-off time of ten o’clock in the morning of December 2, 1988.

On December 12, 1988, the petitioners filed a complaint with the Regional Trial Court of Iloilo against the chairman and members of
PBAC in their official and personal capacities. The plaintiffs claimed that although they had submitted their PRE-C1 on time, the PBAC
refused without just cause to accept them. As a result, they were not included in the list of pre-qualified bidders, could not secure the
needed plans and other documents, and were unable to participate in the scheduled bidding.

In their prayer, they sought the resetting of the December 12, 1988 bidding and the acceptance of their PRE-C1 documents. They also
asked that if the bidding had already been conducted, the defendants be directed not to award the project pending resolution of their
complaint.

On the same date, Judge Lodrigio L. Lebaquin issued a restraining order prohibiting PBAC from conducting the bidding and awarding
the project. 2

On December 16, 1988, the defendants filed a motion to lift the restraining order on the ground that the Court was prohibited from
issued restraining orders, preliminary injunctions and preliminary mandatory injunctions by P.D. 1818.chanroblesvirtualawlibrary

The decree reads pertinently as follows:chanrob1es virtual 1aw library

Section 1. No Court in the Philippines shall have jurisdiction to issue any restraining order, preliminary injunction, or preliminary
infrastructure project, or a mining, fishery, forest or other natural resource development project of the government, or any public utility
operated by the government, including among others public utilities for the transport of the goods and commodities, stevedoring and
arrastre contracts, to prohibit any person or persons, entity or government official from proceeding with, or continuing the execution or
implementation of any such project, or the operation of such public utility, or pursuing any lawful activity necessary for such execution,
implementation or operation.

The movants also contended that the question of the propriety of a preliminary injunction had become moot and academic because the
restraining order was received late, at 2 o’clock in the afternoon of December 12, 1988, after the bidding had been conducted and
closed at eleven thirty in the morning of that date.
In their opposition of the motion, the plaintiffs argued against the applicability of P.D. 1818, pointing out that while ISCOF was a state
college, it had its own charter and separate existence and was not part of the national government or of any local political subdivision.
Even if P.D. 1818 were applicable, the prohibition presumed a valid and legal government project, not one tainted with anomalies like the
project at bar.

They also cited Filipinas Marble Corp. v. IAC, 3 where the Court allowed the issuance of a writ of preliminary injunction despite a similar
prohibition found in P.D. 385. The Court therein stated that:chanrob1es virtual 1aw library

The government, however, is bound by basic principles of fairness and decency under the due process clauses of the Bill of Rights. P.D.
385 was never meant to protect officials of government-lending institutions who take over the management of a borrower corporation,
lead that corporation to bankruptcy through mismanagement or misappropriation of its funds, and who, after ruining it, use the
mandatory provisions of the decree to avoid the consequences of their misleads (p. 188, Emphasis supplied).

On January 2, 1989, the trial court lifted the restraining order and denied the petition for preliminary injunction. It declared that the
building sought to be construed at the ISCOF was an infrastructure project of the government falling within the coverage of P.D. 1818.
Even if it were not, the petition for the issuance of a writ of preliminary injunction would still fail because the sheriff’s return showed that
PBAC was served a copy of the restraining order after the bidding sought to be restrained had already been held. Furthermore, the
members of the PBAC could not be restrained from awarding the project because the authority to do so was lodged in the President of
the ISCOF, who was not a party to the case. 4

In the petition now before us, it is reiterated that P.D. 1818 does not cover the ISCOF because of its separate and distinct corporate
personality. It is also stressed again that the prohibition under P.D. 1818 could not apply to the present controversy because the project
was vitiated with irregularities, to wit:chanrobles.com : virtual law library

1. The invitation to bid as published fixed the deadline of submission of pre-qualification document on December 2, 1988 without
indicating any time, yet after 10:00 o’clock of the given late, the PBAC already refused to accept petitioners’ documents.

2. The time and date of bidding was published as December 12, 1988 at 3:00 p.m. yet it was held at 10:00 o’clock in the morning.

3. Private respondents, for the purpose of inviting bidders to participate, issued a mimeographed "Invitation to Bid" form, which by law
(P.D. 1594 and Implementing Rules, Exh. B-1) is to contain the particulars of the project subject of bidding for the purpose of.

(i) enabling bidders to make an intelligent and accurate bids;

(ii) for PBAC to have a uniform basis for evaluating the bids;

(iii) to prevent collusion between a bidder and the PBAC, by opening to all the particulars of a project.

Additionally, the Invitation to Bid prepared by the respondents and the Itemized Bill of Quantities therein were left blank. 5 And although
the project in question was a "Construction," the private respondents used an Invitation to Bid form for "Materials." 6

The petitioners also point out that the validity of the writ of preliminary injunction had not yet become moot and academic because even
if the bids had been opened before the restraining order was issued, the project itself had not yet been awarded. The ISCOF president
was not an indispensable party because the signing of the award was merely a ministerial function which he could perform only upon the
recommendation of the Award Committee. At any rate, the complaint had already been duly amended to include him as a party
defendant.

In their Comment, the private respondents maintain that since the members of the board of trustees of the ISCOF are all government
officials under Section 7 of P.D. 1523 and since the operations and maintenance of the ISCOF are provided for in the General
Appropriations Law, it is should be considered a government institution whose infrastructure project is covered by P.D. 1818.

Regarding the schedule for pre-qualification, the private respondents insist that PBAC posted on the ISCOF bulletin board an
announcement that the deadline for the submission of pre-qualifications documents was at 10 o’clock of December 2, 1988, and the
opening of bids would be held at 1 o’clock in the afternoon of December 12, 1988. As of ten o’clock in the morning of December 2, 1988,
B.E. construction and Best Built construction had filed only their letters of intent. At two o’clock in the afternoon, B.E., and Best Built filed
through their common representative, Nenette Garuello, their pre-qualification documents which were admitted but stamped "submitted
late." The petitioners were informed of their disqualification on the same date, and the disqualification became final on December 6,
1988. Having failed to take immediate action to compel PBAC to pre-qualify them despite their notice of disqualification, they cannot now
come to this Court to question the binding proper in which they had not participated.

In the petitioners’ Reply, they raise as an additional irregularity the violation of the rule that where the estimate project cost is from P1M
to P5M, the issuance of plans, specifications and proposal book forms should made thirty days before the date of bidding. 7 They point
out that these forms were issued only on December 2, 1988, and not at the latest on November 12, 1988, the beginning of the 30-day
period prior to the scheduled bidding.

In their Rejoinder, the private respondents aver that the documents of B.E. and Best Built were received although filed late and were
reviewed by the Award Committee, which discovered that the contractors had expired licenses. B.E.’s temporary certificate of Renewal
of Contractor’s License was valid only until September 30, 1988, while Best Built’s license was valid only up to June 30,
1988.chanrobles lawlibrary : rednad

The Court has considered the arguments of the parties in light of their testimonial and documentary evidence and the applicable laws
and jurisprudence. It finds for the petitioners.

The 1987 Administrative Code defines a government instrumentality as follows:chanrob1es virtual 1aw library

Instrumentality refers to any agency of the National Government, not integrated within the department framework, vested with special
functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying operational
autonomy, usually through a charter. This term includes regulatory agencies, chartered institutions, and government-owned or controlled
corporations. (Sec. 2 (5) Introductory Provisions).

The same Code describes a chartered institution thus:chanrob1es virtual 1aw library

Chartered institution — refers to any agency organized or operating under a special charter, and vested by law with functions relating to
specific constitutional policies or objectives. This term includes the state universities and colleges, and the monetary authority of the
state. (Sec. 2 (12) Introductory Provisions).

It is clear from the above definitions that ISCOF is a chartered institution and is therefore covered by P.D. 1818.

There are also indications in its charter that ISCOF is a government instrumentality. First, it was created in pursuance of the integrated
fisheries development policy of the State, a priority program of the government of effect the socio-economic life of the nation. Second,
the Treasurer of the Republic of the Philippines also be the ex-officio Treasurer of the state college with its accounts and expenses to be
audited by the Commission on Audit or its duly authorized representative. Third, heads of bureaus and offices of the National
Government are authorized to loan or transfer to it, upon request of the president of the state college, such apparatus, equipment, or
supplies and even the services of such employees as can be spared without serious detriment to public service. Lastly, an additional
amount of P1.5M had been appropriated out of the funds of the National Treasury and it was also decreed in its charter that the funds
and maintenance of the state college would henceforth be included in the General Appropriations Law. 8

Nevertheless, it does not automatically follow that ISCOF is covered by the prohibition in the said decree.

In the case of Datiles and Co. v. Sucaldito, 9 this Court interpreted a similar prohibition contained in P.D. 605, the law after which P.D.
1818 was patterned. It was there declared that the prohibition pertained to the issuance of injunctions or restraining orders by courts
against administrative acts in controversies involving facts or the exercise of discretion in technical cases. The Court observed that to
allow the courts to judge these matters would disturb the smooth functioning of the administrative machinery. Justice Teodoro Padilla
made it clear, however, that on issues definitely outside of this dimension and involving questions of law, courts could not be prevented
by P.D. No. 605 from exercising their power to restrain or prohibit administrative acts.

We see no reason why the above ruling should not apply to P.D. 1818.

There are at least two irregularities committed by PBAC that justified injunction of the bidding and the award of the project.chanrobles
virtualawlibrary chanrobles.com:chanrobles.com.ph

First, PBAC set deadlines for the filing of the PRE-C1 and the opening of bids and then changed these deadlines without prior notice to
prospective participants.

Under the Rules Implementing P.D. 1594, prescribing policies and guidelines for government infrastructure contracts, PBAC shall
provide prospective bidders with the Notice of Pre-qualification and other relevant information regarding the proposed work. Prospective
contractors shall be required to file their ARC-Contractors Confidential Application for Registration & Classifications & the PRE-C2
Confidential Pre-qualification Statement for the Project (prior to the amendment of the rules, this was referred to as PRE-C1) not later
than the deadline set in the published Invitation to Bid, after which date no PRE-C2 shall be submitted and received. Invitations to Bid
shall be advertised for at least three times within a reasonable period but in no case less than two weeks in at least two newspapers of
general circulations. 10

PBAC advertised the pre-qualification deadline as December 2, 1988, without stating the hour thereof, and announced that the opening
of bids would be at 3 o’clock in the afternoon of December 12, 1988. This schedule was changed and a notice of such change was
merely posted at the ISCOF bulletin board. The notice advanced the cut-off time for the submission of pre-qualification documents to 10
o’clock in the morning of December 2, 1988, and the opening of bids to 1 o’clock in the afternoon of December 12, 1988.

The new schedule caused the pre-disqualification of the petitioners as recorded in the minutes of the PBAC meeting held on December
6, 1988. While it may be true that there were fourteen contractors who were pre-qualified despite the change in schedule, this fact did
not cure the defect of the irregular notice. Notably, the petitioners were disqualified because they failed to meet the new deadline and
not because of their expired licenses. ***

We have held that where the law requires a previous advertisement before government contracts can be awarded, non-compliance with
the requirement will, as a general rule, render the same void and of no effect 11 The facts that an invitation for bids has been
communicated to a number of possible bidders is not necessarily sufficient to establish compliance with the requirements of the law if it
is shown that other public bidders have not been similarly notified. 12

Second, PBAC was required to issue to pre-qualified applicants the plans, specifications and proposal book forms for the project to be
bid thirty days before the date of bidding if the estimate project cost was between P1M and P5M. PBAC has not denied that these forms
were issued only on December 2, 1988, or only ten days before the bidding scheduled for December 12, 1988. At the very latest, PBAC
should have issued them on November 12, 1988, or 30 days before the scheduled bidding.

It is apparent that the present controversy did not arise from the discretionary acts of the administrative body nor does it involve merely
technical matters. What is involved here is non-compliance with the procedural rules on bidding which required strict observance. The
purpose of the rules implementing P.D. 1594 is to secure competitive bidding and to prevent favoritism, collusion and fraud in the award
of these contracts to the detriment of the public. This purpose was defeated by the irregularities committed by PBAC.chanrobles law
library : red

It has been held that the three principles in public bidding are the offer to the public, an opportunity for competition and a basis for exact
comparison of bids. A regulation of the matter which excludes any of these factors destroys the distinctive character of the system and
thwarts and purpose of its adoption. 13

In the case at bar, it was the lack of proper notice regarding the pre-qualification requirement and the bidding that caused the elimination
of petitioners B.E. and Best Built. It was not because of their expired licenses, as private respondents now claim. Moreover, the plans
and specifications which are the contractors’ guide to an intelligent bid, were not issued on time, thus defeating the guaranty that
contractors be placed on equal footing when they submit their bids. The purpose of competitive bidding is negated if some contractors
are informed ahead of their rivals of the plans and specifications that are to be the subject of their bids.

P.D. 1818 was not intended to shield from judicial scrutiny irregularities committed by administrative agencies such as the anomalies
above described. Hence, the challenged restraining order was not improperly issued by the respondent judge and the writ of preliminary
injunction should not have been denied. We note from Annex Q of the private respondent’s memorandum, however, that the subject
project has already been "100% completed as to the Engineering Standard." This fait accompli has made the petition for a writ of
preliminary injunction moot and academic.

We come now to the liabilities of the private respondents.

It has been held in a long line of cases that a contract granted without the competitive bidding required by law is void, and the party to
whom it is awarded cannot benefit from it. 14 It has not been shown that the irregularities committed by PBAC were induced by or
participated in by any of the contractors. Hence, liability shall attach only to the private respondents for the prejudice sustained by the
petitioners as a result of the anomalies described above.

As there is no evidence of the actual loss suffered by the petitioners, compensatory damage may not be awarded to them. Moral
damages do not appear to be due either. Even so, the Court cannot close its eyes to the evident bad faith that characterized the conduct
of the private respondents, including the irregularities in the announcement of the bidding and their efforts to persuade the ISCOF
president to award the project after two days from receipt of the restraining order and before they moved to lift such order. For such
questionable acts, they are liable in nominal damages at least in accordance with Article 2221 of the Civil Code, which
states:jgc:chanrobles.com.ph

"Art. 2221. Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant
may be vindicated or, recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

These damages are to assessed against the private respondents in the amount of P10,000.00 each, to be paid separately for each of
petitioners B.E. Construction and Best Built Construction. The other petitioner, Occeña Builders, is not entitled to relief because it
admittedly submitted its pre-qualification documents on December 5, 1988, or three days after the deadline.chanrobles virtual lawlibrary

WHEREFORE, judgment is hereby rendered: a) upholding the restraining order dated December 12, 1988, as not covered by the
prohibition in P.D. 1818; b) ordering the chairman and the members of the PBAC board of trustees, namely Manuel R. Penachos, Jr.,
Alfredo Matangga, Enrico Ticar, and Teresita Villanueva, to each pay separately to petitioners Maria Elena Malaga and Josieleen Najarro
nominal damages P10,000.00 each; and c) removing the said chairman and members from the PBAC board of trustees, or whoever
among them is still incumbent therein, for their malfeasance in office. Costs against PBAC.

Let a copy of this decision be sent to the Office of the Ombudsman.

SO ORDERED.

Griño-Aquino, Medialdea and Bellosillo, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 97149 March 31, 1992

FIDENCIO Y. BEJA, SR., petitioner,

vs.
COURT OF APPEALS, HONORABLE REINERIO O. REYES, in his capacity as Secretary of the Department of Transportation
and Communications; COMMODORE ROGELIO A. DAYAN, in his capacity as General Manager of the Philippine Ports
Authority; DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS, ADMINISTRATIVE ACTION BOARD; and JUSTICE
ONOFRE A. VILLALUZ, in his capacity as Chairman of the Administrative Action Board, DOTC, respondents.

ROMERO, J.:

The instant petition for certiorari questions the jurisdiction of the Secretary of the Department of Transportation and Communications
(DOTC) and/or its Administrative Action Board (AAB) over administrative cases involving personnel below the rank of Assistant General
Manager of the Philippine Ports Authority (PPA), an agency attached to the said Department.

Petitioner Fidencio Y. Beja, Sr. 1 was first employed by the PPA as arrastre supervisor in 1975. He became Assistant Port Operations
Officer in 1976 and Port Operations Officer in 1977. In February 1988, as a result of the reorganization of the PPA, he was appointed
Terminal Supervisor.

On October 21, 1988, the PPA General Manager, Rogelio A. Dayan, filed Administrative Case No. 11-04-88 against petitioner Beja and
Hernando G. Villaluz for grave dishonesty, grave misconduct, willful violation of reasonable office rules and regulations and conduct
prejudicial to the best interest of the service. Beja and Villaluz allegedly erroneously assessed storage fees resulting in the loss of
P38,150.77 on the part of the PPA. Consequently, they were preventively suspended for the charges. After a preliminary investigation
conducted by the district attorney for Region X, Administrative Case No. 11-04-88 was "considered closed for lack of merit."

On December 13, 1988, another charge sheet, docketed as Administrative Case No. 12-01-88, was filed against Beja by the PPA
General Manager also for dishonesty, grave misconduct, violation of reasonable office rules and regulations, conduct prejudicial to the
best interest of the service and for being notoriously undesirable. The charge consisted of six (6) different specifications of administrative
offenses including fraud against the PPA in the total amount of P218,000.00. Beja was also placed under preventive suspension
pursuant to Sec. 41 of P.D. No. 807.

The case was redocketed as Administrative Case No. PPA-AAB-1-049-89 and thereafter, the PPA general manager indorsed it to the
AAB for "appropriate action." At the scheduled hearing, Beja asked for continuance on the ground that he needed time to study the
charges against him. The AAB proceeded to hear the case and gave Beja an opportunity to present evidence. However, on February 20,
1989, Beja filed a petition for certiorari with preliminary injunction before the Regional Trial Court of Misamis Oriental. 2 Two days later,
he filed with the AAB a manifestation and motion to suspend the hearing of Administrative Case No. PPA-AAB-1-049-89 on account of
the pendency of the certiorari proceeding before the court. AAB denied the motion and continued with the hearing of the administrative
case.

Thereafter, Beja moved for the dismissal of the certiorari case below and proceeded to file before this Court a petition for certiorari with
preliminary injunction and/or temporary restraining order. The case was docketed as G.R. No. 87352 captioned "Fidencio Y. Beja v. Hon.
Reinerio 0. Reyes, etc., et al." In the en banc resolution of March 30, 1989, this Court referred the case to the Court of Appeals for
"appropriate action." 3 G.R. No. 87352 was docketed in the Court of Appeals as CA-G.R. SP No. 17270.

Meanwhile, a decision was rendered by the AAB in Administrative Case No. PPA-AAB-049-89. Its dispositive portion reads:

WHEREFORE, judgment is hereby rendered, adjudging the following, namely:

a) That respondents Geronimo Beja, Jr. and Hernando Villaluz are exonerated from the charge against them;

b) That respondent Fidencio Y. Beja be dismissed from the service;

c) That his leave credits and retirement benefits are declared forfeited;

d) That he be disqualified from re-employment in the government service;

e) That his eligibility is recommended to be cancelled.

Pasig, Metro Manila, February 28, 1989.

On December 10, 1990, after appropriate proceedings, the Court of Appeals also rendered a decision 4 in CA-G.R. SP No. 17270
dismissing the petition for certiorari for lack of merit. Hence, Beja elevated the case back to this Court through an "appeal
by certiorari with preliminary injunction and/or temporary restraining order."

We find the pleadings filed in this case to be sufficient bases for arriving at a decision and hence, the filing of memoranda has been
dispensed with.

In his petition, Beja assails the Court of Appeals for having "decided questions of substance in a way probably not in accord with law or
with the applicable decisions" of this Court. 5 Specifically, Beja contends that the Court of Appeals failed to declare that: (a) he was
denied due process; (b) the PPA general manager has no power to issue a preventive suspension order without the necessary approval
of the PPA board of directors; (c) the PPA general manager has no power to refer the administrative case filed against him to the DOTC-
AAB, and (d) the DOTC Secretary, the Chairman of the DOTC-AAB and DOTC-AAB itself as an adjudicatory body, have no jurisdiction
to try the administrative case against him. Simply put, Beja challenges the legality of the preventive suspension and the jurisdiction of
the DOTC Secretary and/or the AAB to initiate and hear administrative cases against PPA personnel below the rank of Assistant General
Manager.

Petitioner anchors his contention that the PPA general manager cannot subject him to a preventive suspension on the following
provision of Sec. 8, Art. V of Presidential Decree No. 857 reorganizing the PPA:

(d) the General Manager shall, subject to the approval of the Board, appoint and remove personnel below the rank of
Assistant General Manager. (Emphasis supplied.)

Petitioner contends that under this provision, the PPA Board of Directors and not the PPA General Manager is the "proper disciplining
authority. 6

As correctly observed by the Solicitor General, the petitioner erroneously equates "preventive suspension" as a remedial measure with
"suspension" as a penalty for administrative dereliction. The imposition of preventive suspension on a government employee charged
with an administrative offense is subject to the following provision of the Civil Service Law, P.D. No. 807:

Sec. 41. Preventive Suspension. — The proper disciplining authority may preventively suspend any subordinate
officer or employee under his authority pending an investigation, if the charge against such officer or employee
involves dishonesty, oppression or grave misconduct, or neglect in the performance of duty, or if there are reasons to
believe that the respondent is guilty of charges which would warrant his removal from the service.

Imposed during the pendency of an administrative investigation, preventive suspension is not a penalty in itself. It is merely a measure
of precaution so that the employee who is charged may be separated, for obvious reasons, from the scene of his alleged misfeasance
while the same is being investigated. 7 Thus, preventive suspension is distinct from the administrative penalty of removal from office
such as the one mentioned in Sec. 8(d) of P.D. No 857. While the former may be imposed on a respondent during the investigation of
the charges against him, the latter is the penalty which may only be meted upon him at the termination of the investigation or the final
disposition of the case.

The PPA general manager is the disciplining authority who may, by himself and without the approval of the PPA Board of Directors,
subject a respondent in an administrative case to preventive suspension. His disciplinary powers are sanctioned, not only by Sec. 8 of
P.D. No. 857 aforequoted, but also by Sec. 37 of P.D. No. 807 granting heads of agencies the "jurisdiction to investigate and decide
matters involving disciplinary actions against officers and employees" in the PPA.

Parenthetically, the period of preventive suspension is limited. It may be lifted even if the disciplining authority has not finally decided the
administrative case provided the ninety-day period from the effectivity of the preventive suspension has been exhausted. The employee
concerned may then be reinstated. 8 However, the said ninety-day period may be interrupted. Section 42 of P.D. No. 807 also mandates
that any fault, negligence or petition of a suspended employee may not be considered in the computation of the said period. Thus, when
a suspended employee obtains from a court of justice a restraining order or a preliminary injunction inhibiting proceedings in an
administrative case, the lifespan of such court order should be excluded in the reckoning of the permissible period of the preventive
suspension. 9

With respect to the issue of whether or not the DOTC Secretary and/or the AAB may initiate and hear administrative cases against PPA
Personnel below the rank of Assistant General Manager, the Court qualifiedly rules in favor of petitioner.

The PPA was created through P.D. No. 505 dated July 11, 1974. Under that Law, the corporate powers of the PPA were vested in a
governing Board of Directors known as the Philippine Port Authority Council. Sec. 5(i) of the same decree gave the Council the power
"to appoint, discipline and remove, and determine the composition of the technical staff of the Authority and other personnel."

On December 23, 1975, P.D. No. 505 was substituted by P.D. No. 857, See. 4(a) thereof created the Philippine Ports Authority which
would be "attached" to the then Department of Public Works, Transportation and Communication. When Executive Order No. 125 dated
January 30, 1987 reorganizing the Ministry of Transportation and Communications was issued, the PPA retained its "attached"
status. 10 Even Executive Order No. 292 or the Administrative Code of 1987 classified the PPA as an agency "attached" to the
Department of Transportation and Communications (DOTC). Sec. 24 of Book IV, Title XV, Chapter 6 of the same Code provides that the
agencies attached to the DOTC "shall continue to operate and function in accordance with the respective charters or laws creating them,
except when they conflict with this Code."
Attachment of an agency to a Department is one of the three administrative relationships mentioned in Book IV, Chapter 7 of the
Administrative Code of 1987, the other two being supervision and control and administrative supervision. "Attachment" is defined in Sec.
38 thereof as follows:

(3) Attachment. — (a) This refers to the lateral relationship between the Department or its equivalent and the attached
agency or corporation for purposes of policy and program coordination. The coordination shall be accomplished by
having the department represented in the governing board of the attached agency or corporation, either as chairman
or as a member, with or without voting rights, if this is permitted by the charter; having the attached corporation or
agency comply with a system of periodic reporting which shall reflect the progress of programs and projects; and
having the department or its equivalent provide general policies through its representative in the board, which shall
serve as the framework for the internal policies of the attached corporation or agency;

(b) Matters of day-to-day administration or all those pertaining to internal operations shall he left to the discretion or
judgment of the executive officer of the agency or corporation. In the event that the Secretary and the head of the
board or the attached agency or corporation strongly disagree on the interpretation and application of policies, and the
Secretary is unable to resolve the disagreement, he shall bring the matter to the President for resolution and direction;

(c) Government-owned or controlled corporations attached to a department shall submit to the Secretary concerned
their audited financial statements within sixty (60) days after the close of the fiscal year; and

(d) Pending submission of the required financial statements, the corporation shall continue to operate on the basis of
the preceding year's budget until the financial statements shall have been submitted. Should any government-owned
or controlled corporation incur an operation deficit at the close of its fiscal year, it shall be subject to administrative
supervision of the department; and the corporation's operating and capital budget shall be subject to the department's
examination, review, modification and approval. (emphasis supplied.)

An attached agency has a larger measure of independence from the Department to which it is attached than one which is under
departmental supervision and control or administrative supervision. This is borne out by the "lateral relationship" between the
Department and the attached agency. The attachment is merely for "policy and program coordination." With respect to administrative
matters, the independence of an attached agency from Departmental control and supervision is further reinforced by the fact that even
an agency under a Department's administrative supervision is free from Departmental interference with respect to appointments and
other personnel actions "in accordance with the decentralization of personnel functions" under the Administrative Code of
1987. 11 Moreover, the Administrative Code explicitly provides that Chapter 8 of Book IV on supervision and control shall not apply to
chartered institutions attached to a Department. 12

Hence, the inescapable conclusion is that with respect to the management of personnel, an attached agency is, to a certain extent, free
from Departmental interference and control. This is more explicitly shown by P.D. No. 857 which provides:

Sec. 8. Management and Staff. — a) The President shall, upon the recommendation of the Board, appoint the General
Manager and the Assistant General Managers.

(b) All other officials and employees of the Authority shall be selected and appointed on the basis of merit and fitness
based on a comprehensive and progressive merit system to be established by the Authority immediately upon its
organization and consistent with Civil Service rules and regulations. The recruitment, transfer, promotion, and
dismissal of all personnel of the Authority, including temporary workers, shall be governed by such merit system.

(c) The General Manager shall, subject to the approval of the Board, determine the staffing pattern and the number of
personnel of the Authority, define their duties and responsibilities, and fix their salaries and emoluments. For
professional and technical positions, the General Manager shall recommend salaries and emoluments that are
comparable to those of similar positions in other government-owned corporations, the provisions of existing rules and
regulations on wage and position classification notwithstanding.

(d) The General Manager shall, subject to the approval by the Board, appoint and remove personnel below the rank of
Assistant General Manager.

xxx xxx xxx

(emphasis supplied.)

Although the foregoing section does not expressly provide for a mechanism for an administrative investigation of personnel, by vesting
the power to remove erring employees on the General Manager, with the approval of the PPA Board of Directors, the law impliedly
grants said officials the power to investigate its personnel below the rank of Assistant Manager who may be charged with an
administrative offense. During such investigation, the PPA General Manager, as earlier stated, may subject the employee concerned to
preventive suspension. The investigation should be conducted in accordance with the procedure set out in Sec. 38 of P.D. No.
807. 13 Only after gathering sufficient facts may the PPA General Manager impose the proper penalty in accordance with law. It is the
latter action which requires the approval of the PPA Board of Directors. 14

From an adverse decision of the PPA General Manager and the Board of Directors, the employee concerned may elevate the matter to
the Department Head or Secretary. Otherwise, he may appeal directly to the Civil Service Commission. The permissive recourse to the
Department Secretary is sanctioned by the Civil Service Law (P.D. No. 807) under the following provisions:

Sec. 37. Disciplinary Jurisdiction. — (a) The Commission shall decide upon appeal all administrative disciplinary
cases involving the imposition of a penalty of suspension for more than thirty days, or fine in an amount exceeding
 thirty days salary, demotion in rank or salary or transfer, removal or dismissal from office. A complaint may be filed
directly with the Commission by a private citizen against a government official or employee in which case it may hear
and decide the case or it may deputize any department or agency or official or group of officials to conduct the
investigation. The results of the investigation shall be submitted to the Commission with recommendation as to the
penalty to be imposed or other action to be taken.

(b) The heads of departments, agencies and instrumentalities, provinces, cities and municipalities shall have
jurisdiction to investigate and decide matters involving disciplinary action against officers and employees under their
jurisdiction. The decisions shall be final in case the penalty imposed is suspension for not more than thirty days or fine
in an amount not exceeding thirty days' salary. In case the decision rendered by a bureau or office head is appealable
to the Commission, the same may be initially appealed to the department and finally to the Commission and pending
appeal, the same shall be executory except when the penalty is removal, in which case the same shall be executory
only after confirmation by the department head.

xxx xxx xxx

(Emphasis supplied.)

It is, therefore, clear that the transmittal of the complaint by the PPA General Manager to the AAB was premature. The PPA General
Manager should have first conducted an investigation, made the proper recommendation for the imposable penalty and sought its
approval by the PPA Board of Directors. It was discretionary on the part of the herein petitioner to elevate the case to the then DOTC
Secretary Reyes. Only then could the AAB take jurisdiction of the case.

The AAB, which was created during the tenure of Secretary Reyes under Office Order No. 88-318 dated July 1, 1988, was designed to
act, decide and recommend to him "all cases of administrative malfeasance, irregularities, grafts and acts of corruption in the
Department." Composed of a Chairman and two (2) members, the AAB came into being pursuant to Administrative Order No. 25 issued
by the President on May 25, 1987. 15 Its special nature as a quasi-judicial administrative body notwithstanding, the AAB is not exempt
from the observance of due process in its proceedings. 16 We are not satisfied that it did so in this case the respondents protestation that
petitioner waived his right to be heard notwithstanding. It should be observed that petitioner was precisely questioning the AAB's
jurisdiction when it sought judicial recourse.

WHEREFORE, the decision of the Court of Appeals is AFFIRMED insofar as it upholds the power of the PPA General Manager to
subject petitioner to preventive suspension and REVERSED insofar as it validates the jurisdiction of the DOTC and/or the AAB to act on
Administrative Case No. PPA-AAB-1-049-89 and rules that due process has been accorded the petitioner.

The AAB decision in said case is hereby declared NULL and VOID and the case in REMANDED to the PPA whose General Manager
shall conduct with dispatch its reinvestigation.

The preventive suspension of petitioner shall continue unless after a determination of its duration, it is found that he had served the total
of ninety (90) days in which case he shall be reinstated immediately.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 115863 March 31, 1995

AIDA D. EUGENIO, petitioner,

vs.
CIVIL SERVICE COMMISSION, HON. TEOFISTO T. GUINGONA, JR. & HON. SALVADOR ENRIQUEZ, JR., respondents.

PUNO, J.:

The power of the Civil Service Commission to abolish the Career Executive Service Board is challenged in this petition for certiorari and
prohibition.

First the facts. Petitioner is the Deputy Director of the Philippine Nuclear Research Institute. She applied for a Career Executive Service
(CES) Eligibility and a CESO rank on August 2, 1993, she was given a CES eligibility. On September 15, 1993, she was recommended
to the President for a CESO rank by the Career Executive Service Board. 1

All was not to turn well for petitioner. On October 1, 1993, respondent Civil Service Commission 2 passed Resolution No. 93-4359, viz:

RESOLUTION NO. 93-4359

WHEREAS, Section 1(1) of Article IX-B provides that Civil Service shall be administered by the Civil Service
Commission, . . .;

WHEREAS, Section 3, Article IX-B of the 1987 Philippine Constitution provides that "The Civil Service Commission, as
the central personnel agency of the government, is mandated to establish a career service and adopt measures to
promote morale, efficiency, integrity, responsiveness, progresiveness and courtesy in the civil service, . . .";

WHEREAS, Section 12 (1), Title I, Subtitle A, Book V of the Administrative Code of 1987 grants the Commission the
power, among others, to administer and enforce the constitutional and statutory provisions on the merit system for all
levels and ranks in the Civil Service;

WHEREAS, Section 7, Title I, Subtitle A, Book V of the Administrative Code of 1987 Provides, among others, that The
Career Service shall be characterized by (1) entrance based on merit and fitness to be determined as far as
practicable by competitive examination, or based highly technical qualifications; (2) opportunity for advancement to
higher career positions; and (3) security of tenure;

WHEREAS, Section 8 (c), Title I, Subtitle A, Book V of the administrative Code of 1987 provides that "The third level
shall cover Positions in the Career Executive Service";

WHEREAS, the Commission recognizes the imperative need to consolidate, integrate and unify the administration of
all levels of positions in the career service.

WHEREAS, the provisions of Section 17, Title I, Subtitle A. Book V of the Administrative Code of 1987 confers on the
Commission the power and authority to effect changes in its organization as the need arises.

WHEREAS, Section 5, Article IX-A of the Constitution provides that the Civil Service Commission shall enjoy fiscal
autonomy and the necessary implications thereof;

NOW THEREFORE, foregoing premises considered, the Civil Service Commission hereby resolves to streamline
reorganize and effect changes in its organizational structure. Pursuant thereto, the Career Executive Service Board,
shall now be known as the Office for Career Executive Service of the Civil Service Commission. Accordingly, the
existing personnel, budget, properties and equipment of the Career Executive Service Board shall now form part of
the Office for Career Executive Service.

The above resolution became an impediment. to the appointment of petitioner as Civil Service Officer, Rank IV. In a letter to petitioner,
dated June 7, 1994, the Honorable Antonio T. Carpio, Chief Presidential legal Counsel, stated:

xxx xxx xxx

 On 1 October 1993 the Civil Service Commission issued CSC Resolution No. 93-4359 which abolished the Career
Executive Service Board.

Several legal issues have arisen as a result of the issuance of CSC Resolution No. 93-4359, including whether the
Civil Service Commission has authority to abolish the Career Executive Service Board. Because these issues remain
unresolved, the Office of the President has refrained from considering appointments of career service eligibles to
career executive ranks.

xxx xxx xxx

You may, however, bring a case before the appropriate court to settle the legal issues arising from issuance by the
Civil Service Commission of CSC Resolution No. 93-4359, for guidance of all concerned.

Thank You.

Finding herself bereft of further administrative relief as the Career Executive Service Board which recommended her CESO Rank IV has
been abolished, petitioner filed the petition at bench to annul, among others, resolution No. 93-4359. The petition is anchored on the
following arguments:

A.

IN VIOLATION OF THE CONSTITUTION, RESPONDENT COMMISSION USURPED THE LEGISLATIVE

FUNCTIONS OF CONGRESS WHEN IT ABOLISHED THE CESB, AN OFFICE CREATED BY LAW, THROUGH THE
ISSUANCE OF CSC: RESOLUTION NO. 93-4359;

B.

ALSO IN VIOLATION OF THE CONSTITUTION, RESPONDENT CSC USURPED THE LEGISLATIVE FUNCTIONS
OF CONGRESS WHEN IT ILLEGALLY AUTHORIZED THE TRANSFER OF PUBLIC MONEY, THROUGH THE
ISSUANCE OF CSC RESOLUTION NO. 93-4359.

Required to file its Comment, the Solicitor General agreed with the contentions of petitioner. Respondent Commission, however, chose
to defend its ground. It posited the following position:

ARGUMENTS FOR PUBLIC RESPONDENT-CSC

I. THE INSTANT PETITION STATES NO CAUSE OF ACTION AGAINST THE PUBLIC RESPONDENT-CSC.

II. THE RECOMMENDATION SUBMITTED TO THE PRESIDENT FOR APPOINTMENT TO A CESO RANK OF
PETITIONER EUGENIO WAS A VALID ACT OF THE CAREER EXECUTIVE SERVICE BOARD OF THE CIVIL
SERVICE COMMISSION AND IT DOES NOT HAVE ANY DEFECT.

III. THE OFFICE OF THE PRESIDENT IS ESTOPPED FROM QUESTIONING THE VALIDITY OF THE
RECOMMENDATION OF THE CESB IN FAVOR OF PETITIONER EUGENIO SINCE THE PRESIDENT HAS
PREVIOUSLY APPOINTED TO CESO RANK FOUR (4) OFFICIALS SIMILARLY SITUATED AS SAID PETITIONER.
FURTHERMORE, LACK OF MEMBERS TO CONSTITUTE A QUORUM. ASSUMING THERE WAS NO QUORUM, IS
NOT THE FAULT OF PUBLIC RESPONDENT CIVIL SERVICE COMMISSION BUT OF THE PRESIDENT WHO HAS
THE POWER TO APPOINT THE OTHER MEMBERS OF THE CESB.

IV. THE INTEGRATION OF THE CESB INTO THE COMMISSION IS AUTHORIZED BY LAW (Sec. 12 (1), Title I,
Subtitle A, Book V of the Administrative Code of the 1987). THIS PARTICULAR ISSUE HAD ALREADY BEEN
SETTLED WHEN THE HONORABLE COURT DISMISSED THE PETITION FILED BY THE HONORABLE MEMBERS
OF THE HOUSE OF REPRESENTATIVES, NAMELY: SIMEON A. DATUMANONG, FELICIANO R. BELMONTE, JR.,
RENATO V. DIAZ, AND MANUEL M. GARCIA IN G.R. NO. 114380. THE AFOREMENTIONED PETITIONERS ALSO
QUESTIONED THE INTEGRATION OF THE CESB WITH THE COMMISSION.

We find merit in the petition. 3

The controlling fact is that the Career Executive Service Board (CESB) was created in the Presidential Decree (P.D.) No. 1 on
September 1, 1974 4 which adopted the Integrated Plan. Article IV, Chapter I, Part of the III of the said Plan provides:

Article IV — Career Executive Service

1. A Career Executive Service is created to form a continuing pool of well-selected and development oriented career
administrators who shall provide competent and faithful service.

2. A Career Executive Service hereinafter referred to in this Chapter as the Board, is created to serve as the
governing body of the Career Executive Service. The Board shall consist of the Chairman of the Civil Service
Commission as presiding officer, the Executive Secretary and the Commissioner of the Budget as ex-officio members
and two other members from the private sector and/or the academic community who are familiar with the principles
and methods of personnel administration.
 xxx xxx xxx

5. The Board shall promulgate rules, standards and procedures on the selection, classification, compensation and
career development of members of the Career Executive Service. The Board shall set up the organization and
operation of the service. (Emphasis supplied)

It cannot be disputed, therefore, that as the CESB was created by law, it can only be abolished by the legislature. This follows an
unbroken stream of rulings that the creation and abolition of public offices is primarily a legislative function. As aptly summed up in AM
JUR 2d on Public Officers and
Employees, 5 viz:

Except for such offices as are created by the Constitution, the creation of public offices is primarily a legislative
function. In so far as the legislative power in this respect is not restricted by constitutional provisions, it supreme, and
the legislature may decide for itself what offices are suitable, necessary, or convenient. When in the exigencies of
government it is necessary to create and define duties, the legislative department has the discretion to determine
whether additional offices shall be created, or whether these duties shall be attached to and become ex-officio duties
of existing offices. An office created by the legislature is wholly within the power of that body, and it may prescribe the
mode of filling the office and the powers and duties of the incumbent, and if it sees fit, abolish the office.

In the petition at bench, the legislature has not enacted any law authorizing the abolition of the CESB. On the contrary, in all the General
Appropriations Acts from 1975 to 1993, the legislature has set aside funds for the operation of CESB. Respondent Commission,
however, invokes Section 17, Chapter 3, Subtitle A. Title I, Book V of the Administrative Code of 1987 as the source of its power to
abolish the CESB. Section 17 provides:

Sec. 17. Organizational Structure. — Each office of the Commission shall be headed by a Director with at least one
Assistant Director, and may have such divisions as are necessary independent constitutional body, the Commission
may effect changes in the organization as the need arises.

But as well pointed out by petitioner and the Solicitor General, Section 17 must be read together with Section 16 of the said Code which
enumerates the offices under the respondent Commission, viz:

Sec. 16. Offices in the Commission. — The Commission shall have the following offices:

(1) The Office of the Executive Director headed by an Executive Director, with a Deputy Executive Director shall
implement policies, standards, rules and regulations promulgated by the Commission; coordinate the programs of the
offices of the Commission and render periodic reports on their operations, and perform such other functions as may
be assigned by the Commission.

(2) The Merit System Protection Board composed of a Chairman and two (2) members shall have the following
functions:

xxx xxx xxx

(3) The Office of Legal Affairs shall provide the Chairman with legal advice and assistance; render counselling
services; undertake legal studies and researches; prepare opinions and ruling in the interpretation and application of
the Civil Service law, rules and regulations; prosecute violations of such law, rules and regulations; and represent the
Commission before any court or tribunal.

(4) The Office of Planning and Management shall formulate development plans, programs and projects; undertake
research and studies on the different aspects of public personnel management; administer management improvement
programs; and provide fiscal and budgetary services.

(5) The Central Administrative Office shall provide the Commission with personnel, financial, logistics and other basic
support services.

(6) The Office of Central Personnel Records shall formulate and implement policies, standards, rules and regulations
pertaining to personnel records maintenance, security, control and disposal; provide storage and extension services;
and provide and maintain library services.

(7) The Office of Position Classification and Compensation shall formulate and implement policies, standards, rules
and regulations relative to the administration of position classification and compensation.

(8) The Office of Recruitment, Examination and Placement shall provide leadership and assistance in developing and
implementing the overall Commission programs relating to recruitment, execution and placement, and formulate
policies, standards, rules and regulations for the proper implementation of the Commission's examination and
placement programs.

(9) The Office of Career Systems and Standards shall provide leadership and assistance in the formulation and
evaluation of personnel systems and standards relative to performance appraisal, merit promotion, and employee
incentive benefit and awards.
 (10) The Office of Human Resource Development shall provide leadership and assistance in the development and
retention of qualified and efficient work force in the Civil Service; formulate standards for training and staff
development; administer service-wide scholarship programs; develop training literature and materials; coordinate and
integrate all training activities and evaluate training programs.

(11) The Office of Personnel Inspection and Audit shall develop policies, standards, rules and regulations for the
effective conduct or inspection and audit personnel and personnel management programs and the exercise of
delegated authority; provide technical and advisory services to Civil Service Regional Offices and government
agencies in the implementation of their personnel programs and evaluation systems.

(12) The Office of Personnel Relations shall provide leadership and assistance in the development and
implementation of policies, standards, rules and regulations in the accreditation of employee associations or
organizations and in the adjustment and settlement of employee grievances and management of employee disputes.

(13) The Office of Corporate Affairs shall formulate and implement policies, standards, rules and regulations governing
corporate officials and employees in the areas of recruitment, examination, placement, career development, merit and
awards systems, position classification and compensation, performing appraisal, employee welfare and benefit,
discipline and other aspects of personnel management on the basis of comparable industry practices.

(14) The Office of Retirement Administration shall be responsible for the enforcement of the constitutional and
statutory provisions, relative to retirement and the regulation for the effective implementation of the retirement of
government officials and employees.

(15) The Regional and Field Offices. — The Commission shall have not less than thirteen (13) Regional offices each
to be headed by a Director, and such field offices as may be needed, each to be headed by an official with at least the
rank of an Assistant Director.

As read together, the inescapable conclusion is that respondent Commission's power to reorganize is limited to offices under its
control as enumerated in Section 16, supra. From its inception, the CESB was intended to be an autonomous entity, albeit
administratively attached to respondent Commission. As conceptualized by the Reorganization Committee "the CESB shall be
autonomous. It is expected to view the problem of building up executive manpower in the government with a broad and positive
outlook." 6 The essential autonomous character of the CESB is not negated by its attachment to respondent Commission. By
said attachment, CESB was not made to fall within the control of respondent Commission. Under the Administrative Code of
1987, the purpose of attaching one functionally inter-related government agency to another is to attain "policy and program
coordination." This is clearly etched out in Section 38(3), Chapter 7, Book IV of the aforecited Code, to wit:

(3) Attachment. — (a) This refers to the lateral relationship between the department or its equivalent and attached
agency or corporation for purposes of policy and program coordination. The coordination may be accomplished by
having the department represented in the governing board of the attached agency or corporation, either as chairman
or as a member, with or without voting rights, if this is permitted by the charter; having the attached corporation or
agency comply with a system of periodic reporting which shall reflect the progress of programs and projects; and
having the department or its equivalent provide general policies through its representative in the board, which shall
serve as the framework for the internal policies of the attached corporation or agency.

Respondent Commission also relies on the case of Datumanong, et al., vs. Civil Service Commission, G. R. No. 114380 where the
petition assailing the abolition of the CESB was dismissed for lack of cause of action. Suffice to state that the reliance is misplaced
considering that the cited case was dismissed for lack of standing of the petitioner, hence, the lack of cause of action.

IN VIEW WHEREOF, the petition is granted and Resolution No. 93-4359 of the respondent Commission is hereby annulled and set
aside. No costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 83578 March 16, 1989

THE PRESIDENTIAL ANTI-DOLLAR SALTING TASK FORCE, petitioner,

vs.
HONORABLE COURT OF APPEALS, HONORABLE TEOFILO L, GUADIZ, JR.,Presiding Judge, REGIONAL TRIAL COURT,
Branch 147: NCR (MAKATI), and KARAMFIL IMPORT-EXPORT CO., INC., respondents.

K. V. Faylona & Associates for respondents.

SARMIENTO, J.:

The petitioner, the Presidential Anti-Dollar Salting Task Force, the President's arm assigned to investigate and prosecute so-called
"dollar salting" activities in the country (per Presidential Decree No. 1936 as amended by Presidential Decree No. 2002), asks the Court
to hold as null and void two Resolutions of the Court of Appeals, dated September 24, 1987 1 and May 20, 1988, 2 reversing its
Decision, dated October 24, 1986. 3 The Decision set aside an Order, dated April 16, 1985, of the Regional Trial Court, 4 as well as its
Order, dated August 21, 1985. The Resolution, dated September 24, 1987 disposed of, and granted, the private respondent Karamfil
Import-Export Co., Inc.'s motion for reconsideration of the October 24, 1986 Decision; the Resolution dated May 20, 1988, in turn,
denied the petitioner's own motion for reconsideration.

The facts are not in controversy. We quote:

On March 12, 1985, State Prosecutor Jose B. Rosales, who is assigned with the Presidential Anti-Dollar Salting Task
Force hereinafter referred to as PADS Task Force for purposes of convenience, issued search warrants Nos. 156,
157, 158, 159, 160 and 161 against the petitioners Karamfil Import-Export Co., Inc., P & B Enterprises Co., Inc.,
Philippine Veterans Corporation, Philippine Veterans Development Corporation, Philippine Construction Development
Corporation, Philippine Lauan Industries Corporation, Inter-trade Development (Alvin Aquino), Amelili U. Malaquiok
Enterprises and Jaime P. Lucman Enterprises.

The application for the issuance of said search warrants was filed by Atty. Napoleon Gatmaytan of the Bureau of Customs who is a
deputized member of the PADS Task Force. Attached to the said application is the affidavit of Josefin M. Castro who is an operative and
investigator of the PADS Task Force. Said Josefin M. Castro is likewise the sole deponent in the purported deposition to support the
application for the issuance of the six (6) search warrants involved in this case. The application filed by Atty. Gatmaytan, the affidavit and
deposition of Josefin M. Castro are all dated March 12, 1985. 5

Shortly thereafter, the private respondent (the petitioner below) went to the Regional Trial Court on a petition to enjoin the
implementation of the search warrants in question. 6 On March 13, 1985, the trial court issued a temporary restraining order [effective
"for a period of five (5) days notice " 7 ] and set the case for hearing on March 18, 1985.

In disposing of the petition, the said court found the material issues to be:

1) Competency of this Court to act on petition filed by the petitioners;

2) Validity of the search warrants issued by respondent State Prosecutor;

3) Whether or not the petition has become moot and academic because all the search warrants sought to be quashed
had already been implemented and executed. 8

On April 16, 1985, the lower court issued the first of its challenged Orders, and held:

WHEREFORE, in view of all the foregoing, the Court hereby declares Search Warrant Nos. 156, 157, 158, 159, 160,
and 161 to be null and void. Accordingly, the respondents are hereby ordered to return and surrender immediately all
the personal properties and documents seized by them from the petitioners by virtue of the aforementioned search
warrants.

SO ORDERED. 9

On August 21, 1985, the trial court denied reconsideration.

On April 4, 1986, the Presidential Anti-Dollar Salting Task Force went to the respondent Court of Appeals to contest, on certiorari, the
twin Order(s) of the lower court.

In ruling initially for the Task Force, the Appellate Court held:

Herein petitioner is a special quasi-judicial body with express powers enumerated under PD 1936 to prosecute foreign
exchange violations defined and punished under P.D. No. 1883.

The petitioner, in exercising its quasi-judicial powers, ranks with the Regional Trial Courts, and the latter in the case at
bar had no jurisdiction to declare the search warrants in question null and void.

Besides as correctly pointed out by the Assistant Solicitor General the decision of the Presidential Anti-Dollar Salting
Task Force is appealable to the Office of the President.10

On November 12, 1986, Karamfil Import-Export Co., Inc. sought a reconsideration, on the question primarily of whether or not the
Presidential Anti-Dollar Salting Task Force is "such other responsible officer' countenanced by the 1973 Constitution to issue warrants of
search and seizure.

As we have indicated, the Court of Appeals, on Karamfil's motion, reversed itself and issued its Resolution, dated September 1987, and
subsequently, its Resolution, dated May 20, 1988, denying the petitioner's motion for reconsideration.

In its petition to this Court, the petitioner alleges that in so issuing the Resolution(s) above-mentioned, the respondent Court of Appeals
"committed grave abuse of discretion and/or acted in excess of its appellate jurisdiction," 11 specifically:

a) In deviating from the settled policy and rulings of the Supreme Court that no Regional Trial Courts may
countermand or restrain the enforcement of lawful writs or decrees issued by a quasi-judicial body of equal and
coordinate rank, like the PADS Task Force;

b) For resorting to judicial legislation to arrive at its erroneous basis for reconsidering its previous Decision dated
October 24, 1986 (see Annex "I") and thus promulgated the questioned Resolutions (Annexes "A" and "B"), which
violated the constitutional doctrine on separation of powers;

c) In not resolving directly the other important issues raised by the petitioner in its Petition in CA-G.R. No. 08622-SP
despite the fact that petitioner has demonstrated sufficiently and convincingly that respondent RTC, in issuing the
questioned Orders in Special Proceeding No. M-624 (see Annexes "C" and 'D"), committed grave abuse of discretion
and/or acted in excess of jurisdiction:

1. In ruling that (a) the description of the things to be seized as stated in the contested search warrant were too
general which allegedly render the search warrants null and void; (b) the applications for the contested search
warrants actually charged two offenses in contravention of the 2nd paragraph, Section 3, Rule 126 of the Rules of
Court; and (c) this case has not become moot and academic, even if the contested search warrants had already been
fully implemented with positive results; and

2. In ruling that the petitioner PADS Task Force has not been granted under PD 1936 'judicial or quasi-judicial
jurisdiction. 12

We find, upon the foregoing facts, that the essential questions that confront us are- (i) is the Presidential Anti-Dollar Salting Task Force a
quasi-judicial body, and one co-equal in rank and standing with the Regional Trial Court, and accordingly, beyond the latter's jurisdiction;
and (ii) may the said presidential body be said to be "such other responsible officer as may be authorized by law" to issue search
warrants under the 1973 Constitution questions we take up seriatim.**

In submitting that it is a quasi-judicial entity, the petitioner states that it is endowed with "express powers and functions under PD No.
1936, to prosecute foreign exchange violations as defined and punished under PD No. 1883." 13 "By the very nature of its express
powers as conferred by the laws," so it is contended, "which are decidedly quasi-judicial or discretionary function, such as to conduct
preliminary investigation on the charges of foreign exchange violations, issue search warrants or warrants of arrest, hold departure
orders, among others, and depending upon the evidence presented, to dismiss the charges or to file the corresponding information in
court of Executive Order No. 934, PD No. 1936 and its Implementing Rules and Regulations effective August 26, 1984), petitioner
exercises quasi-judicial power or the power of adjudication ." 14

The Court of Appeals, in its Resolution now assailed, 15 was of the opinion that "[t]he grant of quasi-judicial powers to petitioner did not
diminish the regular courts' judicial power of interpretation. The right to interpret a law and, if necessary to declare one unconstitutional,
exclusively pertains to the judiciary. In assuming this function, courts do not proceed on the theory that the judiciary is superior to the two
other coordinate branches of the government, but solely on the theory that they are required to declare the law in every case which
come before them." 16

This Court finds the Appellate Court to be in error, since what the petitioner puts to question is the Regional Trial Court's act of assuming
jurisdiction over the private respondent's petition below and its subsequent countermand of the Presidential Anti-Dollar Salting Task
Force's orders of search and seizure, for the reason that the presidential body, as an entity (allegedly) coordinate and co-equal with the
Regional Trial Court, was (is) not vested with such a jurisdiction. An examination of the Presidential Anti-Dollar Salting Task Force's
petition shows indeed its recognition of judicial review (of the acts of Government) as a basic privilege of the courts. Its objection,
precisely, is whether it is the Regional Trial Court, or the superior courts, that may undertake such a review.
Under the Judiciary Reorganization Act of 1980, 17 the Court of Appeals exercises:

(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of Regional Trial
Court and quasi-judicial agencies, instrumentalities, boards or commissions, except those falling within the appellate
jurisdiction of the Supreme Court in accordance with the Constitution, the provisions of this Act, and of subparagraph
(1) of the third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948. 18

xxx xxx xxx

Under the present Constitution, with respect to its provisions on Constitutional Commissions, it is provided, in part that:

... Unless otherwise provided by this Constitution or by law, any decision, order, or ruling of each Commission may be
brought to the Supreme Court on certiorari by the aggrieved party within thirty days from receipt of a copy thereof. 19

On the other hand, Regional Trial Courts have exclusive original jurisdiction:

(6) In all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising judicial or quasi-
judicial functions. 20

xxx xxx xxx

Likewise:

... The Supreme Court may designate certain branches of the Regional Trial Court to handle exclusively criminal
cases, juvenile and domestic relations cases, agrarian case, urban land reform cases which do not fall under the
jurisdiction of quasi- judicial bodies and agencies and/or such other special cases as the Supreme Court may
determine in the interest of a speedy and efficient administration of justice. 21

xxx xxx xxx

Under our Resolution dated January 11, 1983: 22

... The appeals to the Intermediate Appellate Court [now, Court of Appeals] from quasi-judicial bodies shall continue to
be governed by the provisions of Republic Act No. 5434 insofar as the same is not inconsistent with the provisions of
B.P. Blg. 129. 23

The pertinent provisions of Republic Act No. 5434 are as follows:

SECTION 1. Appeals from specified agencies.— Any provision of existing law or Rule of Court to the contrary
notwithstanding, parties aggrieved by a final ruling, award, order, decision, or judgment of the Court of Agrarian
Relations; the Secretary of Labor under Section 7 of Republic Act Numbered Six hundred and two, also known as the
"Minimum Wage Law"; the Department of Labor under Section 23 of Republic Act Numbered Eight hundred seventy-
five, also known as the "Industrial Peace Act"; the Land Registration Commission; the Securities and Exchange
Commission; the Social Security Commission; the Civil Aeronautics Board; the Patent Office and the Agricultural
Inventions Board, may appeal therefrom to the Court of Appeals, within the period and in the manner herein provided,
whether the appeal involves questions of fact, mixed questions of fact and law, or questions of law, or all three kinds of
questions. From final judgments or decisions of the Court of Appeals, the aggrieved party may appeal by certiorari to
the Supreme Court as provided in Rule 45 of the Rules of Court. 24

Because of subsequent amendments, including the abolition of various special courts, 25 jurisdiction over quasi-judicial bodies has to
be, consequently, determined by the corresponding amendatory statutes. Under the Labor Code, decisions and awards of the National
Labor Relations Commission are final and executory, but, nevertheless, 'reviewable by this Court through a petition for certiorari and not
by way of appeal." 26

Under the Property Registration Decree, decisions of the Commission of Land Registration, en consults, are appealable to the Court of
Appeals. 27

The decisions of the Securities and Exchange Commission are likewise appealable to the Appellate Court, 28 and so are decisions of
the Social Security Commission.29

As a rule, where legislation provides for an appeal from decisions of certain administrative bodies to the Court of Appeals, it means that
such bodies are co-equal with the Regional Trial Courts, in terms of rank and stature, and logically, beyond the control of the latter.

As we have observed, the question is whether or not the Presidential Anti-Dollar Salting Task Force is, in the first place, a quasi-judicial
body, and one whose decisions may not be challenged before the regular courts, other than the higher tribunals the Court of Appeals
and this Court.

A quasi-judicial body has been defined as "an organ of government other than a court and other than a legislature, which affects the
rights of private parties through either adjudication or rule making." 30 The most common types of such bodies have been listed as
follows:
 (1) Agencies created to function in situations wherein the government is offering some gratuity, grant, or special
privilege, like the defunct Philippine Veterans Board, Board on Pensions for Veterans, and NARRA, and Philippine
Veterans Administration.

(2) Agencies set up to function in situations wherein the government is seeking to carry on certain government
functions, like the Bureau of Immigration, the Bureau of Internal Revenue, the Board of Special Inquiry and Board of
Commissioners, the Civil Service Commission, the Central Bank of the Philippines.

(3) Agencies set up to function in situations wherein the government is performing some business service for the
public, like the Bureau of Posts, the Postal Savings Bank, Metropolitan Waterworks & Sewerage Authority, Philippine
National Railways, the Civil Aeronautics Administration.

(4) Agencies set up to function in situations wherein the government is seeking to regulate business affected with
public interest, like the Fiber Inspections Board, the Philippine Patent Office, Office of the Insurance Commissioner.

(5) Agencies set up to function in situations wherein the government is seeking under the police power to regulate
private business and individuals, like the Securities & Exchange Commission, Board of Food Inspectors, the Board of
Review for Moving Pictures, and the Professional Regulation Commission.

(6) Agencies set up to function in situations wherein the government is seeking to adjust individual controversies
because of some strong social policy involved, such as the National Labor Relations Commission, the Court of
Agrarian Relations, the Regional Offices of the Ministry of Labor, the Social Security Commission, Bureau of Labor
Standards, Women and Minors Bureau. 31

As may be seen, it is the basic function of these bodies to adjudicate claims and/or to determine rights, and unless its decision are
seasonably appealed to the proper reviewing authorities, the same attain finality and become executory. A perusal of the Presidential
Anti-Dollar Salting Task Force's organic act, Presidential Decree No. 1936, as amended by Presidential Decree No. 2002, convinces the
Court that the Task Force was not meant to exercise quasi-judicial functions, that is, to try and decide claims and execute its judgments.
As the President's arm called upon to combat the vice of "dollar salting" or the blackmarketing and salting of foreign exchange, 32 it is
tasked alone by the Decree to handle the prosecution of such activities, but nothing more. We quote:

SECTION 1. Powers of the Presidential Anti-Dollar Salting Task Force.-The Presidential Anti-Dollar Salting Task Force,
hereinafter referred to as Task Force, shall have the following powers and authority:

a) Motu proprio or upon complaint, to investigate and prosecute all dollar salting activities, including the overvaluation
of imports and the undervaluation of exports;

b) To administer oaths, summon persons or issue subpoenas requiring the attendance and testimony of witnesses or
the production of such books, papers, contracts, records, statements of accounts, agreements, and other as may be
necessary in the conduct of investigation;

c) To appoint or designate experts, consultants, state prosecutors or fiscals, investigators and hearing officers to assist
the Task Force in the discharge of its duties and responsibilities; gather data, information or documents; conduct
hearings, receive evidence, both oral and documentary, in all cases involving violation of foreign exchange laws or
regulations; and submit reports containing findings and recommendations for consideration of appropriate authorities;

d) To punish direct and indirect contempts with the appropriate penalties therefor under Rule 71 of the Rules of Court;
and to adopt such measures and take such actions as may be necessary to implement this Decree.

xxx xxx xxx

f. After due investigation but prior to the filing of the appropriate criminal charges with the fiscal's office or the courts as
the case may be, to impose a fine and/or administrative sanctions as the circumstances warrant, upon any person
found committing or to have committed acts constituting blackmarketing or salting abroad of foreign exchange,
provided said person voluntarily admits the facts and circumstances constituting the offense and presents proof that
the foreign exchange retained abroad has already been brought into the country.

Thereafter, no further civil or criminal action may be instituted against said person before any other judicial regulatory
or administrative body for violation of Presidential Decree No. 1883.

The amount of the fine shall be determined by the Chairman of the Presidential Anti- Dollar Salting Task Force and
paid in Pesos taking into consideration the amount of foreign exchange retained abroad, the exchange rate
differentials, uncollected taxes and duties thereon, undeclared profits, interest rates and such other relevant factors.

The fine shall be paid to the Task Force which shall retain Twenty percent (20 %) thereof. The informer, if any, shall be
entitled to Twenty percent (20 %) of the fine. Should there be no informer, the Task Force shall be entitle to retain
Forty percent (40 %) of the fine and the balance shall accrue to the general funds of the National government. The
amount of the fine to be retained by the Task Force shall form part of its Confidential Fund and be utilized for the
operations of the Task Force . 33

The Court sees nothing in the aforequoted provisions (except with respect to the Task Force's powers to issue search warrants) that will
reveal a legislative intendment to confer it with quasi-judicial responsibilities relative to offenses punished by Presidential Decree No.
1883. Its undertaking, as we said, is simply, to determine whether or not probable cause exists to warrant the filing of charges with the
proper court, meaning to say, to conduct an inquiry preliminary to a judicial recourse, and to recommend action "of appropriate
authorities". It is not unlike a fiscal's office that conducts a preliminary investigation to determine whether or not prima facie evidence
exists to justify haling the respondent to court, and yet, while it makes that determination, it cannot be said to be acting as a quasi-court.
For it is the courts, ultimately, that pass judgment on the accused, not the fiscal.

It is not unlike the Presidential Commission on Good Government either, the executive body appointed to investigate and prosecute
cases involving "ill-gotten wealth". It had been vested with enormous powers, like the issuance of writs of sequestration, freeze orders,
and similar processes, but that did not, on account thereof alone, make it a quasi-judicial entity as defined by recognized authorities. It
cannot pronounce judgement of the accused's culpability, the jurisdiction to do which is exclusive upon the Sandiganbayan. 34

If the Presidential Anti-Dollar Salting Task Force is not, hence, a quasi-judicial body, it cannot be said to be co-equal or coordinate with
the Regional Trial Court. There is nothing in its enabling statutes that would demonstrate its standing at par with the said court.

In that respect, we do not find error in the respondent Court of Appeal's resolution sustaining the assumption of jurisdiction by the
court a quo.

It will not do to say that the fact that the Presidential Task Force has been empowered to issue warrants of arrest, search, and seizure,
makes it, ergo, a "semi-court". Precisely, it is the objection interposed by the private respondent, whether or not it can under the 1973
Charter, issue such kinds of processes.

It must be observed that under the present Constitution, the powers of arrest and search are exclusive upon judges. 35 To that extent,
the case has become moot and academic. Nevertheless, since the question has been specifically put to the Court, we find it
unavoidable to resolve it as the final arbiter of legal controversies, pursuant to the provisions of the 1973 Constitution during whose
regime the case was commenced.

Since the 1973 Constitution took force and effect and until it was so unceremoniously discarded in 1986, its provisions conferring the
power to issue arrest and search warrants upon an officer, other than a judge, by fiat of legislation have been at best controversial.
In Lim v. Ponce de Leon, 36 a 1975 decision, this Court ruled that a fiscal has no authority to issue search warrants, but held in the
same vein that, by virtue of the responsible officer" clause of the 1973 Bill of Rights, "any lawful officer authorized by law can issue a
search warrant or warrant of arrest.37 Authorities, however, have continued to express reservations whether or not fiscals may, by
statute, be given such a power. 38

Less than a year later, we promulgated Collector of Customs v. Villaluz, 39 in which we categorically averred: Until now only the judge
can issue the warrant of arrest." 40 "No law or presidential decree has been enacted or promulgated vesting the same authority in a
particular responsible officer ." 41

Apparently, Villaluz had settled the debate, but the same question persisted following this Courts subsequent rulings upholding the
President's alleged emergency arrest powers .42 [Mr. Justice Hugo Gutierrez would hold, however, that a Presidential Commitment
Order (PCO) is (was) not a species of "arrest" in its technical sense, and that the (deposed) Chief Executive, in issuing one, does not do
so in his capacity as a "responsible officer" under the 1973 Charter, but rather, as Commander-in-Chief of the Armed Forces in times of
emergency, or in order to carry out the deportation of undesirable aliens.43 In the distinguished Justice's opinion then, these are acts
that can be done without need of judicial intervention because they are not, precisely, judicial but Presidential actions.]

In Ponsica v. Ignalaga,44 however, we held that the mayor has been made a "responsible officer' by the Local Government Code, 45 but
had ceased to be one with the approval of the 1987 Constitution according judges sole authority to issue arrest and search warrants. But
in the same breath, we did not rule the grant under the Code unconstitutional based on the provisions of the former Constitution. We
were agreed, though, that the "responsible officer" referred to by the fundamental law should be one capable of approximating "the cold
neutrality of an impartial judge." 46

In striking down Presidential Decree No. 1936 the respondent Court relied on American jurisprudence, notably, Katz v. United
States, 47 Johnson v. United States, 48 and Coolidge v. New Hampshire 49 in which the American Supreme Court ruled that
prosecutors (like the petitioner) cannot be given such powers because of their incapacity for a "detached scrutiny" 50 of the cases
before them. We affirm the Appellate Court.

We agree that the Presidential Anti-Dollar Salting Task Force exercises, or was meant to exercise, prosecutorial powers, and on that
ground, it cannot be said to be a neutral and detached "judge" to determine the existence of probable cause for purposes of arrest or
search. Unlike a magistrate, a prosecutor is naturally interested in the success of his case. Although his office "is to see that justice is
done and not necessarily to secure the conviction of the person accused," 51 he stands, invariably, as the accused's adversary and his
accuser. To permit him to issue search warrants and indeed, warrants of arrest, is to make him both judge and jury in his own right,
when he is neither. That makes, to our mind and to that extent, Presidential Decree No. 1936 as amended by Presidential Decree No.
2002, unconstitutional.

It is our ruling, thus, that when the 1973 Constitution spoke of "responsible officer" to whom the authority to issue arrest and search
warrants may be delegated by legislation, it did not furnish the legislator with the license to give that authority to whomsoever it pleased.
It is to be noted that the Charter itself makes the qualification that the officer himself must be "responsible". We are not saying, of
course, that the Presidential Anti-Dollar Salting Task Force (or any similar prosecutor) is or has been irresponsible in discharging its duty.
Rather, we take "responsibility", as used by the Constitution, to mean not only skill and competence but more significantly, neutrality and
independence comparable to the impartiality presumed of a judicial officer. A prosecutor can in no manner be said to be possessed of
the latter qualities.

According to the Court of Appeals, the implied exclusion of prosecutors under the 1973 Constitution was founded on the requirements of
due process, notably, the assurance to the respondent of an unbiased inquiry of the charges against him prior to the arrest of his person
or seizure of his property. We add that the exclusion is also demanded by the principle of separation of powers on which our republican
structure rests. Prosecutors exercise essentially an executive function (the petitioner itself is chaired by the Minister, now Secretary, of
Trade and Industry), since under the Constitution, the President has pledged to execute the laws. 52 As such, they cannot be made to
issue judicial processes without unlawfully impinging the prerogative of the courts.

At any rate, Ponsica v. Ignalaga should foreclose all questions on the matter, although the Court hopes that this disposition has clarified
a controversy that had generated often bitter debates and bickerings.

The Court joins the Government in its campaign against the scourge of "dollar- salting", a pernicious practice that has substantially
drained the nation's coffers and has seriously threatened its economy. We recognize the menace it has posed (and continues to pose)
unto the very stability of the country, the urgency for tough measures designed to contain if not eradicate it, and foremost, the need for
cooperation from the citizenry in an all-out campaign. But while we support the State's efforts, we do so not at the expense of
fundamental rights and liberties and constitutional safeguards against arbitrary and unreasonable acts of Government. If in the event
that as a result of this ruling, we prove to be an "obstacle" to the vital endeavour of stamping out the blackmarketing of valuable foreign
exchange, we do not relish it and certainly, do not mean it. The Constitution simply does not leave us much choice.

WHEREFORE, the petition is DISMISSED. No costs. SO ORDERED.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-57883 March 12, 1982

GUALBERTO J. DE LA LLANA Presiding Judge, Branch II of the City Court of Olongapo, ESTANISLAO L. CESA, JR., FIDELA Y.
VARGAS, BENJAMIN C. ESCOLANGO, JUANITO C. ATIENZA, MANUEL REYES ROSAPAPAN, JR., VIRGILIO E. ACIERTO, and
PORFIRIO AGUILLON AGUILA, petitioners,
vs.
MANUEL ALBA, Minister of Budget, FRANCISCO TANTUICO, Chairman, Commission on Audit, and RICARDO PUNO, Minister
of Justice, Respondents.

FERNANDO, C.J.:

This Court, pursuant to its grave responsibility of passing upon the validity of any executive or legislative act in an appropriate cases,
has to resolve the crucial issue of the constitutionality of Batas Pambansa Blg. 129, entitled "An act reorganizing the Judiciary,
Appropriating Funds Therefor and for Other Purposes." The task of judicial review, aptly characterized as exacting and delicate, is never
more so than when a conceded legislative power, that of judicial reorganization, 1 may possibly collide with the time-honored principle of
the independence of the judiciary 2as protected and safeguarded by this constitutional provision: "The Members of the Supreme Court
and judges of inferior courts shall hold office during good behavior until they reach the age of seventy years or become incapacitated to
discharge the duties of their office. The Supreme Court shall have the power to discipline judges of inferior courts and, by a vote of at
least eight Members, order their dismissal." 3 For the assailed legislation mandates that Justices and judges of inferior courts from the
Court of Appeals to municipal circuit courts, except the occupants of the Sandiganbayan and the Court of Tax Appeals, unless appointed
to the inferior courts established by such Act, would be considered separated from the judiciary. It is the termination of their incumbency
that for petitioners justifies a suit of this character, it being alleged that thereby the security of tenure provision of the Constitution has
been ignored and disregarded,

That is the fundamental issue raised in this proceeding, erroneously entitled Petition for Declaratory Relief and/or for
Prohibition 4 considered by this Court as an action for prohibited petition, seeking to enjoin respondent Minister of the Budget,
respondent Chairman of the Commission on Audit, and respondent Minister of Justice from taking any action implementing Batas
Pambansa Blg. 129. Petitioners 5 sought to bolster their claim by imputing lack of good faith in its enactment and characterizing as an
undue delegation of legislative power to the President his authority to fix the compensation and allowances of the Justices and judges
thereafter appointed and the determination of the date when the reorganization shall be deemed completed. In the very comprehensive
and scholarly Answer of Solicitor General Estelito P. Mendoza, 6 it was pointed out that there is no valid justification for the attack on the
constitutionality of this statute, it being a legitimate exercise of the power vested in the Batasang Pambansa to reorganize the judiciary,
the allegations of absence of good faith as well as the attack on the independence of the judiciary being unwarranted and devoid of any
support in law. A Supplemental Answer was likewise filed on October 8, 1981, followed by a Reply of petitioners on October 13. After the
hearing in the morning and afternoon of October 15, in which not only petitioners and respondents were heard through counsel but also
the amici curiae, 7 and thereafter submission of the minutes of the proceeding on the debate on Batas Pambansa Blg. 129, this petition
was deemed submitted for decision.

The importance of the crucial question raised called for intensive and rigorous study of all the legal aspects of the case. After such
exhaustive deliberation in several sessions, the exchange of views being supplemented by memoranda from the members of the Court,
it is our opinion and so hold that Batas Pambansa Blg. 129 is not unconstitutional.

1. The argument as to the lack of standing of petitioners is easily resolved. As far as Judge de la Llana is concerned, he certainly falls
within the principle set forth in Justice Laurel's opinion in People v. Vera. 8 Thus: "The unchallenged rule is that the person who impugns
the validity of a statute must have a personal and substantial interest in the case such that he has sustained, or will sustain, direct injury
as a result of its enforcement." 9 The other petitioners as members of the bar and officers of the court cannot be considered as devoid of
"any personal and substantial interest" on the matter. There is relevance to this excerpt from a separate opinion in Aquino, Jr. v.
Commission on Elections: 10 "Then there is the attack on the standing of petitioners, as vindicating at most what they consider a public
right and not protecting their rights as individuals. This is to conjure the specter of the public right dogma as an inhibition to parties intent
on keeping public officials staying on the path of constitutionalism. As was so well put by Jaffe: 'The protection of private rights is an
essential constituent of public interest and, conversely, without a well-ordered state there could be no enforcement of private rights.
Private and public interests are, both in substantive and procedural sense, aspects of the totality of the legal order.' Moreover, petitioners
have convincingly shown that in their capacity as taxpayers, their standing to sue has been amply demonstrated. There would be a
retreat from the liberal approach followed in Pascual v. Secretary of Public Works, foreshadowed by the very decision of People v.
Vera where the doctrine was first fully discussed, if we act differently now. I do not think we are prepared to take that step. Respondents,
however, would hark back to the American Supreme Court doctrine in Mellon v. Frothingham with their claim that what petitioners
possess 'is an interest which is shared in common by other people and is comparatively so minute and indeterminate as to afford any
basis and assurance that the judicial process can act on it.' That is to speak in the language of a bygone era even in the United States.
For as Chief Justice Warren clearly pointed out in the later case of Flast v. Cohen, the barrier thus set up if not breached has definitely
been lowered." 11

2. The imputation of arbitrariness to the legislative body in the enactment of Batas Pambansa Blg. 129 to demonstrate lack of good faith
does manifest violence to the facts. Petitioners should have exercised greater care in informing themselves as to its antecedents. They
had laid themselves open to the accusation of reckless disregard for the truth, On August 7, 1980, a Presidential Committee on Judicial
Reorganization was organized. 12 This Executive Order was later amended by Executive Order No. 619-A., dated September 5 of that
year. It clearly specified the task assigned to it: "1. The Committee shall formulate plans on the reorganization of the Judiciary which
shall be submitted within seventy (70) days from August 7, 1980 to provide the President sufficient options for the reorganization of the
entire Judiciary which shall embrace all lower courts, including the Court of Appeals, the Courts of First Instance, the City and Municipal
Courts, and all Special Courts, but excluding the Sandigan Bayan." 13 On October 17, 1980, a Report was submitted by such Committee
on Judicial Reorganization. It began with this paragraph: "The Committee on Judicial Reorganization has the honor to submit the
following Report. It expresses at the outset its appreciation for the opportunity accorded it to study ways and means for what today is a
basic and urgent need, nothing less than the restructuring of the judicial system. There are problems, both grave and pressing, that call
for remedial measures. The felt necessities of the time, to borrow a phrase from Holmes, admit of no delay, for if no step be taken and at
the earliest opportunity, it is not too much to say that the people's faith in the administration of justice could be shaken. It is imperative
that there be a greater efficiency in the disposition of cases and that litigants, especially those of modest means — much more so, the
poorest and the humblest — can vindicate their rights in an expeditious and inexpensive manner. The rectitude and the fairness in the
way the courts operate must be manifest to all members of the community and particularly to those whose interests are affected by the
exercise of their functions. It is to that task that the Committee addresses itself and hopes that the plans submitted could be a starting
point for an institutional reform in the Philippine judiciary. The experience of the Supreme Court, which since 1973 has been empowered
to supervise inferior courts, from the Court of Appeals to the municipal courts, has proven that reliance on improved court management
as well as training of judges for more efficient administration does not suffice. I hence, to repeat, there is need for a major reform in the
judicial so stem it is worth noting that it will be the first of its kind since the Judiciary Act became effective on June 16, 1901." 14 I t went
to say: "I t does not admit of doubt that the last two decades of this century are likely to be attended with problems of even greater
complexity and delicacy. New social interests are pressing for recognition in the courts. Groups long inarticulate, primarily those
economically underprivileged, have found legal spokesmen and are asserting grievances previously ignored. Fortunately, the judicially
has not proved inattentive. Its task has thus become even more formidable. For so much grist is added to the mills of justice. Moreover,
they are likewise to be quite novel. The need for an innovative approach is thus apparent. The national leadership, as is well-known, has
been constantly on the search for solutions that will prove to be both acceptable and satisfactory. Only thus may there be continued
national progress." 15 After which comes: "To be less abstract, the thrust is on development. That has been repeatedly stressed — and
rightly so. All efforts are geared to its realization. Nor, unlike in the past, was it to b "considered as simply the movement towards
economic progress and growth measured in terms of sustained increases in per capita income and Gross National Product
(GNP). 16 For the New Society, its implication goes further than economic advance, extending to "the sharing, or more appropriately, the
democratization of social and economic opportunities, the substantiation of the true meaning of social justice." 17 This process of
modernization and change compels the government to extend its field of activity and its scope of operations. The efforts towards
reducing the gap between the wealthy and the poor elements in the nation call for more regulatory legislation. That way the social justice
and protection to labor mandates of the Constitution could be effectively implemented." 18 There is likelihood then "that some measures
deemed inimical by interests adversely affected would be challenged in court on grounds of validity. Even if the question does not go
that far, suits may be filed concerning their interpretation and application. ... There could be pleas for injunction or restraining orders.
Lack of success of such moves would not, even so, result in their prompt final disposition. Thus delay in the execution of the policies
embodied in law could thus be reasonably expected. That is not conducive to progress in development." 19 For, as mentioned in such
Report, equally of vital concern is the problem of clogged dockets, which "as is well known, is one of the utmost gravity. Notwithstanding
the most determined efforts exerted by the Supreme Court, through the leadership of both retired Chief Justice Querube Makalintal and
the late Chief Justice Fred Ruiz Castro, from the time supervision of the courts was vested in it under the 1973 Constitution, the trend
towards more and more cases has continued." 20 It is understandable why. With the accelerated economic development, the growth of
population, the increasing urbanization, and other similar factors, the judiciary is called upon much oftener to resolve controversies.
Thus confronted with what appears to be a crisis situation that calls for a remedy, the Batasang Pambansa had no choice. It had to act,
before the ailment became even worse. Time was of the essence, and yet it did not hesitate to be duly mindful, as it ought to be, of the
extent of its coverage before enacting Batas Pambansa Blg. 129.

3. There is no denying, therefore, the need for "institutional reforms," characterized in the Report as "both pressing and urgent." 21 It is
worth noting, likewise, as therein pointed out, that a major reorganization of such scope, if it were to take place, would be the most
thorough after four generations. 22 The reference was to the basic Judiciary Act generations . enacted in June of 1901, 23 amended in a
significant way, only twice previous to the Commonwealth. There was, of course, the creation of the Court of Appeals in 1935, originally
composed "of a Presiding Judge and ten appellate Judges, who shall be appointed by the President of the Philippines, with the consent
of the Commission on Appointments of the National Assembly, 24 It could "sit en banc, but it may sit in two divisions, one of six and
another of five Judges, to transact business, and the two divisions may sit at the same time." 25 Two years after the establishment of
independence of the Republic of the Philippines, the Judiciary Act of 1948 26 was passed. It continued the existing system of regular
inferior courts, namely, the Court of Appeals, Courts of First Instance, 27 the Municipal Courts, at present the City Courts, and the Justice
of the Peace Courts, now the Municipal Circuit Courts and Municipal Courts. The membership of the Court of Appeals has been
continuously increased. 28 Under a 1978 Presidential Decree, there would be forty-five members, a Presiding Justice and forty-four
Associate Justices, with fifteen divisions. 29 Special courts were likewise created. The first was the Court of Tax Appeals in 1954, 30 next
came the Court of Agrarian Relations in 1955, 31 and then in the same year a Court of the Juvenile and Domestic Relations for Manila in
1955, 32 subsequently followed by the creation of two other such courts for Iloilo and Quezon City in 1966. 33 In 1967, Circuit Criminal
Courts were established, with the Judges having the same qualifications, rank, compensation, and privileges as judges of Courts of First
Instance. 34

4. After the submission of such Report, Cabinet Bill No. 42, which later became the basis of Batas Pambansa Blg. 129, was introduced.
After setting forth the background as above narrated, its Explanatory Note continues: "Pursuant to the President's instructions, this
proposed legislation has been drafted in accordance with the guidelines of that report with particular attention to certain objectives of the
reorganization, to wit, the attainment of more efficiency in disposal of cases, a reallocation of jurisdiction, and a revision of procedures
which do not tend to the proper meeting out of justice. In consultation with, and upon a consensus of, the governmental and
parliamentary leadership, however, it was felt that some options set forth in the Report be not availed of. Instead of the proposal to
confine the jurisdiction of the intermediate appellate court merely to appellate adjudication, the preference has been opted to increase
rather than diminish its jurisdiction in order to enable it to effectively assist the Supreme Court. This preference has been translated into
one of the innovations in the proposed Bill." 35 In accordance with the parliamentary procedure, the Bill was sponsored by the Chairman
of the Committee on Justice, Human Rights and Good Government to which it was referred. Thereafter, Committee Report No. 225 was
submitted by such Committee to the Batasang Pambansa recommending the approval with some amendments. In the sponsorship
speech of Minister Ricardo C. Puno, there was reference to the Presidential Committee on Judicial Reorganization. Thus: "On October
17, 1980, the Presidential Committee on Judicial Reorganization submitted its report to the President which contained the 'Proposed
Guidelines for Judicial Reorganization.' Cabinet Bill No. 42 was drafted substantially in accordance with the options presented by these
guidelines. Some options set forth in the aforesaid report were not availed of upon consultation with and upon consensus of the
government and parliamentary leadership. Moreover, some amendments to the bill were adopted by the Committee on Justice, Human
Rights and Good Government, to which The bill was referred, following the public hearings on the bill held in December of 1980. The
hearings consisted of dialogues with the distinguished members of the bench and the bar who had submitted written proposals,
suggestions, and position papers on the bill upon the invitation of the Committee on Justice, Human Rights and Good
Government." 36 Stress was laid by the sponsor that the enactment of such Cabinet Bill would, firstly, result in the attainment of more
efficiency in the disposal of cases. Secondly, the improvement in the quality of justice dispensed by the courts is expected as a
necessary consequence of the easing of the court's dockets. Thirdly, the structural changes introduced in the bill, together with the
reallocation of jurisdiction and the revision of the rules of procedure, are designated to suit the court system to the exigencies of the
present day Philippine society, and hopefully, of the foreseeable future." 37 it may be observed that the volume containing the minutes of
the proceedings of the Batasang Pambansa show that 590 pages were devoted to its discussion. It is quite obvious that it took
considerable time and effort as well as exhaustive study before the act was signed by the President on August 14, 1981. With such a
background, it becomes quite manifest how lacking in factual basis is the allegation that its enactment is tainted by the vice of
arbitrariness. What appears undoubted and undeniable is the good faith that characterized its enactment from its inception to the affixing
of the Presidential signature.

5. Nothing is better settled in our law than that the abolition of an office within the competence of a legitimate body if done in good faith
suffers from no infirmity. The ponencia of Justice J.B.L. Reyes in Cruz v. Primicias, Jr. 38reiterated such a doctrine: "We find this point
urged by respondents, to be without merit. No removal or separation of petitioners from the service is here involved, but the validity of
the abolition of their offices. This is a legal issue that is for the Courts to decide. It is well-known rule also that valid abolition of offices is
neither removal nor separation of the incumbents. ... And, of course, if the abolition is void, the incumbent is deemed never to have
ceased to hold office. The preliminary question laid at rest, we pass to the merits of the case. As well-settled as the rule that the abolition
of an office does not amount to an illegal removal of its incumbent is the principle that, in order to be valid, the abolition must be made in
good faith." 39 The above excerpt was quoted with approval in Bendanillo, Sr. v. Provincial Governor, 40 two earlier cases enunciating a
similar doctrine having preceded it. 41 As with the offices in the other branches of the government, so it is with the judiciary. The test
remains whether the abolition is in good faith. As that element is conspicuously present in the enactment of Batas Pambansa Blg. 129,
then the lack of merit of this petition becomes even more apparent. The concurring opinion of Justice Laurel in Zandueta v. De la
Costa 42 cannot be any clearer. This is a quo warranto proceeding filed by petitioner, claiming that he, and not respondent, was entitled
to he office of judge of the Fifth Branch of the Court of First Instance of Manila. There was a Judicial Reorganization Act in 1936, 43 a
year after the inauguration of the Commonwealth, amending the Administrative Code to organize courts of original jurisdiction known as
the Courts of First Instance Prior to such statute, petitioner was the incumbent of such branch. Thereafter, he received an ad interim
appointment, this time to the Fourth Judicial District, under the new legislation. Unfortunately for him, the Commission on Appointments
of then National Assembly disapproved the same, with respondent being appointed in his place. He contested the validity of the Act
insofar as it resulted in his being forced to vacate his position This Court did not rule squarely on the matter. His petition was dismissed
on the ground of estoppel. Nonetheless, the separate concurrence of Justice Laurel in the result reached, to repeat, reaffirms in no
uncertain terms the standard of good faith to preclude any doubt as to the abolition of an inferior court, with due recognition of the
security of tenure guarantee. Thus: " I am of the opinion that Commonwealth Act No. 145 in so far as it reorganizes, among other judicial
districts, the Ninth Judicial District, and establishes an entirely new district comprising Manila and the provinces of Rizal and Palawan, is
valid and constitutional. This conclusion flows from the fundamental proposition that the legislature may abolish courts inferior to the
Supreme Court and therefore may reorganize them territorially or otherwise thereby necessitating new appointments and commissions.
Section 2, Article VIII of the Constitution vests in the National Assembly the power to define, prescribe and apportion the jurisdiction of
the various courts, subject to certain limitations in the case of the Supreme Court. It is admitted that section 9 of the same article of the
Constitution provides for the security of tenure of all the judges. The principles embodied in these two sections of the same article of the
Constitution must be coordinated and harmonized. A mere enunciation of a principle will not decide actual cases and controversies of
every sort. (Justice Holmes in Lochner vs. New York, 198 U.S., 45; 49 Law. ed; 937)" 44 justice Laurel continued: "I am not insensible to
the argument that the National Assembly may abuse its power and move deliberately to defeat the constitutional provision guaranteeing
security of tenure to all judges, But, is this the case? One need not share the view of Story, Miller and Tucker on the one hand, or the
opinion of Cooley, Watson and Baldwin on the other, to realize that the application of a legal or constitutional principle is necessarily
factual and circumstantial and that fixity of principle is the rigidity of the dead and the unprogressive. I do say, and emphatically,
however, that cases may arise where the violation of the constitutional provision regarding security of tenure is palpable and plain, and
that legislative power of reorganization may be sought to cloak an unconstitutional and evil purpose. When a case of that kind arises, it
will be the time to make the hammer fall and heavily. But not until then. I am satisfied that, as to the particular point here discussed, the
purpose was the fulfillment of what was considered a great public need by the legislative department and that Commonwealth Act No.
145 was not enacted purposely to affect adversely the tenure of judges or of any particular judge. Under these circumstances, I am for
sustaining the power of the legislative department under the Constitution. To be sure, there was greater necessity for reorganization
consequent upon the establishment of the new government than at the time Acts Nos. 2347 and 4007 were approved by the defunct
Philippine Legislature, and although in the case of these two Acts there was an express provision providing for the vacation by the
judges of their offices whereas in the case of Commonwealth Act No. 145 doubt is engendered by its silence, this doubt should be
resolved in favor of the valid exercise of the legislative power." 45

6. A few more words on the question of abolition. In the above-cited opinion of Justice Laurel in Zandueta, reference was made to Act
No. 2347 46 on the reorganization of the Courts of First Instance and to Act No. 4007 47 on the reorganization of all branches of the
government, including the courts of first instance. In both of them, the then Courts of First Instance were replaced by new courts with the
same appellation. As Justice Laurel pointed out, there was no question as to the fact of abolition. He was equally categorical as to
Commonwealth Act No. 145, where also the system of the courts of first instance was provided for expressly. It was pointed out by
Justice Laurel that the mere creation of an entirely new district of the same court is valid and constitutional. such conclusion flowing
"from the fundamental proposition that the legislature may abolish courts inferior to the Supreme Court and therefore may reorganize
them territorially or otherwise thereby necessitating new appointments and commissions." 48 The challenged statute creates an
intermediate appellate court, 49 regional trial courts, 50 metropolitan trial courts of the national capital region, 51 and other metropolitan trial
courts, 52 municipal trial courts in cities, 53 as well as in municipalities, 54 and municipal circuit trial courts. 55 There is even less reason
then to doubt the fact that existing inferior courts were abolished. For the Batasang Pambansa, the establishment of such new inferior
courts was the appropriate response to the grave and urgent problems that pressed for solution. Certainly, there could be differences of
opinion as to the appropriate remedy. The choice, however, was for the Batasan to make, not for this Court, which deals only with the
question of power. It bears mentioning that in Brillo v. Eñage 56 this Court, in an unanimous opinion penned by the late Justice Diokno,
citing Zandueta v. De la Costa, ruled: "La segunda question que el recurrrido plantea es que la Carta de Tacloban ha abolido el puesto.
Si efectivamente ha sido abolido el cargo, entonces ha quedado extinguido el derecho de recurente a ocuparlo y a cobrar el salario
correspodiente. Mc Culley vs. State, 46 LRA, 567. El derecho de un juez de desempenarlo hasta los 70 años de edad o se incapacite
no priva al Congreso de su facultad de abolir, fusionar o reorganizar juzgados no constitucionales." 57 Nonetheless, such well-
established principle was not held applicable to the situation there obtaining, the Charter of Tacloban City creating a city court in place of
the former justice of the peace court. Thus: "Pero en el caso de autos el Juzgado de Tacloban no ha sido abolido. Solo se le ha
cambiado el nombre con el cambio de forma del gobierno local." 58 The present case is anything but that. Petitioners did not and could
not prove that the challenged statute was not within the bounds of legislative authority.

7. This opinion then could very well stop at this point. The implementation of Batas Pambansa Blg. 129, concededly a task incumbent on
the Executive, may give rise, however, to questions affecting a judiciary that should be kept independent. The all-embracing scope of the
assailed legislation as far as all inferior courts from the Courts of Appeals to municipal courts are concerned, with the exception solely of
the Sandiganbayan and the Court of Tax Appeals 59 gave rise, and understandably so, to misgivings as to its effect on such cherished
Ideal. The first paragraph of the section on the transitory provision reads: "The provisions of this Act shall be immediately carried out in
accordance with an Executive Order to be issued by the President. The Court of Appeals, the Courts of First Instance, the Circuit
Criminal Courts, the Juvenile and Domestic Relations Courts, the Courts of Agrarian Relations, the City Courts, the Municipal Courts,
and the Municipal Circuit Courts shall continue to function as presently constituted and organized, until the completion of the
reorganization provided in this Act as declared by the President. Upon such declaration, the said courts shall be deemed automatically
abolished and the incumbents thereof shall cease to hold the office." 60 There is all the more reason then why this Court has no choice
but to inquire further into the allegation by petitioners that the security of tenure provision, an assurance of a judiciary free from
extraneous influences, is thereby reduced to a barren form of words. The amended Constitution adheres even more clearly to the long-
established tradition of a strong executive that antedated the 1935 Charter. As noted in the work of former Vice-Governor Hayden, a
noted political scientist, President Claro M. Recto of the 1934 Convention, in his closing address, in stressing such a concept,
categorically spoke of providing "an executive power which, subject to the fiscalization of the Assembly, and of public opinion, will not
only know how to govern, but will actually govern, with a firm and steady hand, unembarrassed by vexatious interferences by other
departments, or by unholy alliances with this and that social group." 61 The above excerpt was cited with approval by Justice Laurel
in Planas v. Gil. 62 Moreover, under the 1981 Amendments, it may be affirmed that once again the principle of separation of powers, to
quote from the same jurist as ponente in Angara v. Electoral Commission, 63 "obtains not through express provision but by actual
division." 64 The president, under Article VII, shall be the head of state and chief executive of the Republic of the
Philippines." 65 Moreover, it is equally therein expressly provided that all the powers he possessed under the 1935 Constitution are once
again vested in him unless the Batasang Pambansa provides otherwise." 66 Article VII of the 1935 Constitution speaks categorically:
"The Executive power shall be vested in a President of the Philippines." 67 As originally framed, the 1973 Constitution created the
position of President as the "symbolic head of state." 68 In addition, there was a provision for a Prime Minister as the head of government
exercising the executive power with the assistance of the Cabinet 69 Clearly, a modified parliamentary system was established. In the
light of the 1981 amendments though, this Court in Free Telephone Workers Union v. Minister of Labor 70 could state: "The adoption of
certain aspects of a parliamentary system in the amended Constitution does not alter its essentially presidential character." 71 The
retention, however, of the position of the Prime Minister with the Cabinet, a majority of the members of which shall come from the
regional representatives of the Batasang Pambansa and the creation of an Executive Committee composed of the Prime Minister as
Chairman and not more than fourteen other members at least half of whom shall be members of the Batasang Pambansa, clearly
indicate the evolving nature of the system of government that is now operative. 72 What is equally apparent is that the strongest ties bind
the executive and legislative departments. It is likewise undeniable that the Batasang Pambansa retains its full authority to enact
whatever legislation may be necessary to carry out national policy as usually formulated in a caucus of the majority party. It is
understandable then why in Fortun v. Labang 73 it was stressed that with the provision transferring to the Supreme Court administrative
supervision over the Judiciary, there is a greater need "to preserve unimpaired the independence of the judiciary, especially so at
present, where to all intents and purposes, there is a fusion between the executive and the legislative branches." 74

8. To be more specific, petitioners contend that the abolition of the existing inferior courts collides with the security of tenure enjoyed by
incumbent Justices and judges under Article X, Section 7 of the Constitution. There was a similar provision in the 1935 Constitution. It
did not, however, go as far as conferring on this Tribunal the power to supervise administratively inferior courts. 75 Moreover, this Court is
em powered "to discipline judges of inferior courts and, by a vote of at least eight members, order their dismissal." 76 Thus it possesses
the competence to remove judges. Under the Judiciary Act, it was the President who was vested with such power. 77 Removal is, of
course, to be distinguished from termination by virtue of the abolition of the office. There can be no tenure to a non-existent office. After
the abolition, there is in law no occupant. In case of removal, there is an office with an occupant who would thereby lose his position. It is
in that sense that from the standpoint of strict law, the question of any impairment of security of tenure does not arise. Nonetheless, for
the incumbents of inferior courts abolished, the effect is one of separation. As to its effect, no distinction exists between removal and the
abolition of the office. Realistically, it is devoid of significance. He ceases to be a member of the judiciary. In the implementation of the
assailed legislation, therefore, it would be in accordance with accepted principles of constitutional construction that as far as incumbent
justices and judges are concerned, this Court be consulted and that its view be accorded the fullest consideration. No fear need be
entertained that there is a failure to accord respect to the basic principle that this Court does not render advisory opinions. No question
of law is involved. If such were the case, certainly this Court could not have its say prior to the action taken by either of the two
departments. Even then, it could do so but only by way of deciding a case where the matter has been put in issue. Neither is there any
intrusion into who shall be appointed to the vacant positions created by the reorganization. That remains in the hands of the Executive to
whom it properly belongs. There is no departure therefore from the tried and tested ways of judicial power, Rather what is sought to be
achieved by this liberal interpretation is to preclude any plausibility to the charge that in the exercise of the conceded power of
reorganizing tulle inferior courts, the power of removal of the present incumbents vested in this Tribunal is ignored or disregarded. The
challenged Act would thus be free from any unconstitutional taint, even one not readily discernidble except to those predisposed to view
it with distrust. Moreover, such a construction would be in accordance with the basic principle that in the choice of alternatives between
one which would save and another which would invalidate a statute, the former is to be preferred. 78 There is an obvious way to do so.
The principle that the Constitution enters into and forms part of every act to avoid any constitutional taint must be applied Nuñez v.
Sandiganbayan, 79 promulgated last January, has this relevant excerpt: "It is true that other Sections of the Decree could have been so
worded as to avoid any constitutional objection. As of now, however, no ruling is called for. The view is given expression in the
concurring and dissenting opinion of Justice Makasiar that in such a case to save the Decree from the direct fate of invalidity, they must
be construed in such a way as to preclude any possible erosion on the powers vested in this Court by the Constitution. That is a
proposition too plain to be committed. It commends itself for approval." 80 Nor would such a step be unprecedented. The Presidential
Decree constituting Municipal Courts into Municipal Circuit Courts, specifically provides: "The Supreme Court shall carry out the
provisions of this Decree through implementing orders, on a province-to-province basis." 81 It is true there is no such provision in this Act,
but the spirit that informs it should not be ignored in the Executive Order contemplated under its Section 44. 82 Thus Batas Pambansa
Blg. 129 could stand the most rigorous test of constitutionality. 83

9. Nor is there anything novel in the concept that this Court is called upon to reconcile or harmonize constitutional provisions. To be
specific, the Batasang Pambansa is expressly vested with the authority to reorganize inferior courts and in the process to abolish
existing ones. As noted in the preceding paragraph, the termination of office of their occupants, as a necessary consequence of such
abolition, is hardly distinguishable from the practical standpoint from removal, a power that is now vested in this Tribunal. It is of the
essence of constitutionalism to assure that neither agency is precluded from acting within the boundaries of its conceded competence.
That is why it has long been well-settled under the constitutional system we have adopted that this Court cannot, whenever appropriate,
avoid the task of reconciliation. As Justice Laurel put it so well in the previously cited Angara decision, while in the main, "the
Constitution has blocked out with deft strokes and in bold lines, allotment of power to the executive, the legislative and the judicial
departments of the government, the overlapping and interlacing of functions and duties between the several departments, however,
sometimes makes it hard to say just where the one leaves off and the other begins." 84 It is well to recall another classic utterance from
the same jurist, even more emphatic in its affirmation of such a view, moreover buttressed by one of those insights for which Holmes
was so famous "The classical separation of government powers, whether viewed in the light of the political philosophy of Aristotle,
Locke, or Motesquieu or of the postulations of Mabini, Madison, or Jefferson, is a relative theory of government. There is more truism
and actuality in interdependence than in independence and separation of powers, for as observed by Justice Holmes in a case of
Philippine origin, we cannot lay down 'with mathematical precision and divide the branches into water-tight compartments' not only
because 'the great ordinances of the Constitution do not establish and divide fields of black and white but also because 'even the more
specific of them are found to terminate in a penumbra shading gradually from one extreme to the other.'" 85 This too from Justice Tuazon,
likewise expressing with force and clarity why the need for reconciliation or balancing is well-nigh unavodiable under the fundamental
principle of separation of powers: "The constitutional structure is a complicated system, and overlappings of governmental functions are
recognized, unavoidable, and inherent necessities of governmental coordination." 86 In the same way that the academe has noted the
existence in constitutional litigation of right versus right, there are instances, and this is one of them, where, without this attempt at
harmonizing the provisions in question, there could be a case of power against power. That we should avoid.

10. There are other objections raised but they pose no difficulty. Petitioners would characterize as an undue delegation of legislative
power to the President the grant of authority to fix the compensation and the allowances of the Justices and judges thereafter appointed.
A more careful reading of the challenged Batas Pambansa Blg. 129 ought to have cautioned them against raising such an issue. The
language of the statute is quite clear. The questioned provisions reads as follows: "Intermediate Appellate Justices, Regional Trial
Judges, Metropolitan Trial Judges, municipal Trial Judges, and Municipal Circuit Trial Judges shall receive such receive such
compensation and allowances as may be authorized by the President along the guidelines set forth in Letter of Implementation No. 93
pursuant to Presidential Decree No. 985, as amended by Presidential Decree No. 1597." 87 The existence of a standard is thus clear.
The basic postulate that underlies the doctrine of non-delegation is that it is the legislative body which is entrusted with the competence
to make laws and to alter and repeal them, the test being the completeness of the statue in all its terms and provisions when enacted.
As pointed out in Edu v. Ericta: 88 "To avoid the taint of unlawful delegation, there must be a standard, which implies at the very least that
the legislature itself determines matters of principle and lays down fundamental policy. Otherwise, the charge of complete abdication
may be hard to repel. A standard thus defines legislative policy, marks its limits, maps out its boundaries and specifies the public agency
to apply it. It indicates the circumstances under which the legislative command is to be effected. It is the criterion by which legislative
purpose may be carried out. Thereafter, the executive or administrative office designated may in pursuance of the above guidelines
promulgate supplemental rules and regulations. The standard may be either express or implied. If the former, the non-delegation
objection is easily met. The standard though does not have to be spelled out specifically. It could be implied from the policy and purpose
of the act considered as a whole." 89 The undeniably strong links that bind the executive and legislative departments under the amended
Constitution assure that the framing of policies as well as their implementation can be accomplished with unity, promptitude, and
efficiency. There is accuracy, therefore, to this observation in the Free Telephone Workers Union decision: "There is accordingly more
receptivity to laws leaving to administrative and executive agencies the adoption of such means as may be necessary to effectuate a
valid legislative purpose. It is worth noting that a highly-respected legal scholar, Professor Jaffe, as early as 1947, could speak of
delegation as the 'dynamo of modern government.'" 90 He warned against a "restrictive approach" which could be "a deterrent factor to
much-needed legislation." 91 Further on this point from the same opinion" "The spectre of the non-delegation concept need not haunt,
therefore, party caucuses, cabinet sessions or legislative chambers." 92 Another objection based on the absence in the statue of what
petitioners refer to as a "definite time frame limitation" is equally bereft of merit. They ignore the categorical language of this provision:
"The Supreme Court shall submit to the President, within thirty (30) days from the date of the effectivity of this act, a staffing pattern for
all courts constituted pursuant to this Act which shall be the basis of the implementing order to be issued by the President in accordance
with the immediately succeeding section." 93 The first sentence of the next section is even more categorical: "The provisions of this Act
shall be immediately carried out in accordance with an Executive Order to be issued by the President." 94 Certainly petitioners cannot be
heard to argue that the President is insensible to his constitutional duty to take care that the laws be faithfully executed. 95 In the
meanwhile, the existing inferior courts affected continue functioning as before, "until the completion of the reorganization provided in this
Act as declared by the President. Upon such declaration, the said courts shall be deemed automatically abolished and the incumbents
thereof shall cease to hold office." 96 There is no ambiguity. The incumbents of the courts thus automatically abolished "shall cease to
hold office." No fear need be entertained by incumbents whose length of service, quality of performance, and clean record justify their
being named anew, 97 in legal contemplation without any interruption in the continuity of their service. 98 It is equally reasonable to
assume that from the ranks of lawyers, either in the government service, private practice, or law professors will come the new
appointees. In the event that in certain cases a little more time is necessary in the appraisal of whether or not certain incumbents
deserve reappointment, it is not from their standpoint undesirable. Rather, it would be a reaffirmation of the good faith that will
characterize its implementation by the Executive. There is pertinence to this observation of Justice Holmes that even acceptance of the
generalization that courts ordinarily should not supply omissions in a law, a generalization qualified as earlier shown by the principle that
to save a statute that could be done, "there is no canon against using common sense in construing laws as saying what they obviously
mean." 99 Where then is the unconstitutional flaw

11. On the morning of the hearing of this petition on September 8, 1981, petitioners sought to have the writer of this opinion and Justices
Ramon C. Aquino and Ameurfina Melencio-Herrera disqualified because the first-named was the chairman and the other two, members
of the Committee on Judicial Reorganization. At the hearing, the motion was denied. It was made clear then and there that not one of
the three members of the Court had any hand in the framing or in the discussion of Batas Pambansa Blg. 129. They were not consulted.
They did not testify. The challenged legislation is entirely the product of the efforts of the legislative body. 100 Their work was limited, as
set forth in the Executive Order, to submitting alternative plan for reorganization. That is more in the nature of scholarly studies. That the
undertook. There could be no possible objection to such activity. Ever since 1973, this Tribunal has had administrative supervision over
interior courts. It has had the opportunity to inform itself as to the way judicial business is conducted and how it may be improved. Even
prior to the 1973 Constitution, it is the recollection of the writer of this opinion that either the then Chairman or members of the
Committee on Justice of the then Senate of the Philippines 101consulted members of the Court in drafting proposed legislation affecting
the judiciary. It is not inappropriate to cite this excerpt from an article in the 1975 Supreme Court Review: "In the twentieth century the
Chief Justice of the United States has played a leading part in judicial reform. A variety of conditions have been responsible for the
development of this role, and foremost among them has been the creation of explicit institutional structures designed to facilitate
reform." 102 Also: "Thus the Chief Justice cannot avoid exposure to and direct involvement in judicial reform at the federal level and, to
the extent issues of judicial federalism arise, at the state level as well." 103
12. It is a cardinal article of faith of our constitutional regime that it is the people who are endowed with rights, to secure which a
government is instituted. Acting as it does through public officials, it has to grant them either expressly or impliedly certain powers.
Those they exercise not for their own benefit but for the body politic. The Constitution does not speak in the language of ambiguity: "A
public office is a public trust." 104 That is more than a moral adjuration It is a legal imperative. The law may vest in a public official certain
rights. It does so to enable them to perform his functions and fulfill his responsibilities more efficiently. It is from that standpoint that the
security of tenure provision to assure judicial independence is to be viewed. It is an added guarantee that justices and judges can
administer justice undeterred by any fear of reprisal or untoward consequence. Their judgments then are even more likely to be inspired
solely by their knowledge of the law and the dictates of their conscience, free from the corrupting influence of base or unworthy motives.
The independence of which they are assured is impressed with a significance transcending that of a purely personal right. As thus
viewed, it is not solely for their welfare. The challenged legislation Thus subject d to the most rigorous scrutiny by this Tribunal, lest by
lack of due care and circumspection, it allow the erosion of that Ideal so firmly embedded in the national consciousness There is this
farther thought to consider. independence in thought and action necessarily is rooted in one's mind and heart. As emphasized by former
Chief Justice Paras in Ocampo v. Secretary of Justice, 105 there is no surer guarantee of judicial independence than the God-given
character and fitness of those appointed to the Bench. The judges may be guaranteed a fixed tenure of office during good behavior, but
if they are of such stuff as allows them to be subservient to one administration after another, or to cater to the wishes of one litigant after
another, the independence of the judiciary will be nothing more than a myth or an empty Ideal. Our judges, we are confident, can be of
the type of Lord Coke, regardless or in spite of the power of Congress — we do not say unlimited but as herein exercised — to
reorganize inferior courts." 106 That is to recall one of the greatest Common Law jurists, who at the cost of his office made clear that he
would not just blindly obey the King's order but "will do what becomes [him] as a judge." So it was pointed out in the first leading case
stressing the independence of the judiciary, Borromeo v. Mariano, 107 The ponencia of Justice Malcolm Identified good judges with "men
who have a mastery of the principles of law, who discharge their duties in accordance with law, who are permitted to perform the duties
of the office undeterred by outside influence, and who are independent and self-respecting human units in a judicial system equal and
coordinate to the other two departments of government." 108 There is no reason to assume that the failure of this suit to annul Batas
Pambansa Blg. 129 would be attended with deleterious consequences to the administration of justice. It does not follow that the abolition
in good faith of the existing inferior courts except the Sandiganbayan and the Court of Tax Appeals and the creation of new ones will
result in a judiciary unable or unwilling to discharge with independence its solemn duty or one recreant to the trust reposed in it. Nor
should there be any fear that less than good faith will attend the exercise be of the appointing power vested in the Executive. It cannot
be denied that an independent and efficient judiciary is something to the credit of any administration. Well and truly has it been said that
the fundamental principle of separation of powers assumes, and justifiably so, that the three departments are as one in their
determination to pursue the Ideals and aspirations and to fulfilling the hopes of the sovereign people as expressed in the Constitution.
There is wisdom as well as validity to this pronouncement of Justice Malcolm in Manila Electric Co. v. Pasay Transportation
Company, 109 a decision promulgated almost half a century ago: "Just as the Supreme Court, as the guardian of constitutional rights,
should not sanction usurpations by any other department or the government, so should it as strictly confine its own sphere of influence
to the powers expressly or by implication conferred on it by the Organic Act." 110 To that basic postulate underlying our constitutional
system, this Court remains committed.

WHEREFORE, the unconstitutionality of Batas Pambansa Blg. 129 not having been shown, this petition is dismissed. No costs.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-27811 November 17, 1967

LACSON-MAGALLANES CO., INC., plaintiff-appellant,

vs.
JOSE PAÑO, HON. JUAN PAJO, in his capacity as Executive Secretary, and HON. JUAN DE G. RODRIGUEZ, in his capacity as
Secretary of Agriculture and Natural Resources, defendants-appellees.

Leopoldo M. Abellera for plaintiff-appellant.

Victorio Advincula for defendant Jose Paño.
Office of the Solicitor General for defendant Secretary of Agriculture and Natural Resources and Executive Secretary.

SANCHEZ, J.:

The question — May the Executive Secretary, acting by authority of the President, reverse a decision of the Director of Lands that had
been affirmed by the Executive Secretary of Agriculture and Natural Resources — yielded an affirmative answer from the lower court.1

Hence, this appeal certified to this Court by the Court of Appeals upon the provisions of Sections 17 and 31 of the Judiciary Act of 1948,
as amended.

The undisputed controlling facts are:

In 1932, Jose Magallanes was a permittee and actual occupant of a 1,103-hectare pasture land situated in Tamlangon, Municipality of
Bansalan, Province of Davao.

On January 9, 1953, Magallanes ceded his rights and interests to a portion (392,7569 hectares) of the above public land to plaintiff.

On April 13, 1954, the portion Magallanes ceded to plaintiff was officially released from the forest zone as pasture land and declared
agricultural land.

On January 26, 1955, Jose Paño and nineteen other claimants2 applied for the purchase of ninety hectares of the released area.

On March 29, 1955, plaintiff corporation in turn filed its own sales application covering the entire released area. This was protested by
Jose Paño and his nineteen companions upon the averment that they are actual occupants of the part thereof covered by their own
sales application.

The Director of Lands, following an investigation of the conflict, rendered a decision on July 31, 1956 giving due course to the
application of plaintiff corporation, and dismissing the claim of Jose Paño and his companions. A move to reconsider failed.

On July 5, 1957, the Secretary of Agriculture and Natural Resources — on appeal by Jose Paño for himself and his companions — held
that the appeal was without merit and dismissed the same.

The case was elevated to the President of the Philippines.

On June 25, 1958, Executive Secretary Juan Pajo, "[b]y authority of the President" decided the controversy, modified the decision of the
Director of Lands as affirmed by the Secretary of Agriculture and Natural Resources, and (1) declared that "it would be for the public
interest that appellants, who are mostly landless farmers who depend on the land for their existence, be allocated that portion on which
they have made improvements;" and (2) directed that the controverted land (northern portion of Block I, LC Map 1749, Project No. 27, of
Bansalan, Davao, with Latian River as the dividing line) "should be subdivided into lots of convenient sizes and allocated to actual
occupants, without prejudice to the corporation's right to reimbursement for the cost of surveying this portion." It may be well to state, at
this point, that the decision just mentioned, signed by the Executive Secretary, was planted upon the facts as found in said decision.

Plaintiff corporation took the foregoing decision to the Court of First Instance praying that judgment be rendered declaring: (1) that the
decision of the Secretary of Agriculture and Natural Resources has full force and effect; and (2) that the decision of the Executive
Secretary is contrary to law and of no legal force and effect.

And now subject of this appeal is the judgment of the court a quo dismissing plaintiff's case.

1. Plaintiff's mainstay is Section 4 of Commonwealth Act 141. The precept there is that decisions of the Director of Lands "as to
questions of facts shall be conclusive when approved" by the Secretary of Agriculture and Natural Resources. Plaintiff's trenchment
claim is that this statute is controlling not only upon courts but also upon the President.

Plaintiff's position is incorrect. The President's duty to execute the law is of constitutional origin.3 So, too, is his control of all executive
departments.4 Thus it is, that department heads are men of his confidence. His is the power to appoint them; his, too, is the privilege to
dismiss them at pleasure. Naturally, he controls and directs their acts. Implicit then is his authority to go over, confirm, modify or reverse
the action taken by his department secretaries. In this context, it may not be said that the President cannot rule on the correctness of a
decision of a department secretary.

Particularly in reference to the decisions of the Director of Lands, as affirmed by the Secretary of Agriculture and Natural Resources, the
standard practice is to allow appeals from such decisions to the Office of the President.5This Court has recognized this practice in
several cases. In one, the decision of the Lands Director as approved by the Secretary was considered superseded by that of the
President's appeal.6 In other cases, failure to pursue or resort to this last remedy of appeal was considered a fatal defect, warranting
dismissal of the case, for non-exhaustion of all administrative remedies.7

Parenthetically, it may be stated that the right to appeal to the President reposes upon the President's power of control over the
executive departments.8 And control simply means "the power of an officer to alter or modify or nullify or set aside what a subordinate
officer had done in the performance of his duties and to substitute the judgment of the former for that of the latter."9

This unquestionably negates the assertion that the President cannot undo an act of his department secretary.

2. Plaintiff next submits that the decision of the Executive Secretary herein is an undue delegation of power. The Constitution, petitioner
asserts, does not contain any provision whereby the presidential power of control may be delegated to the Executive Secretary. It is
argued that it is the constitutional duty of the President to act personally upon the matter.

It is correct to say that constitutional powers there are which the President must exercise in person.10 Not as correct, however, is it so
say that the Chief Executive may not delegate to his Executive Secretary acts which the Constitution does not command that he perform
in person.11 Reason is not wanting for this view. The President is not expected to perform in person all the multifarious executive and
administrative functions. The Office of the Executive Secretary is an auxiliary unit which assists the President. The rule which has thus
gained recognition is that "under our constitutional setup the Executive Secretary who acts for and in behalf and by authority of the
President has an undisputed jurisdiction to affirm, modify, or even reverse any order" that the Secretary of Agriculture and Natural
Resources, including the Director of Lands, may issue.12

3. But plaintiff underscores the fact that the Executive Secretary is equal in rank to the other department heads, no higher than anyone
of them. From this, plaintiff carves the argument that one department head, on the pretext that he is an alter ego of the President, cannot
intrude into the zone of action allocated to another department secretary. This argument betrays lack of appreciation of the fact that
where, as in this case, the Executive Secretary acts "[b]y authority of the President," his decision is that of the President's. Such decision
is to be given full faith and credit by our courts. The assumed authority of the Executive Secretary is to be accepted. For, only the
President may rightfully say that the Executive Secretary is not authorized to do so. Therefore, unless the action taken is "disapproved
or reprobated by the Chief Executive,"13 that remains the act of the Chief Executive, and cannot be successfully assailed.14 No such
disapproval or reprobation is even intimated in the record of this case.

For the reasons given, the judgment under review is hereby affirmed. Costs against plaintiff. So ordered.
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. L-54554 March 30, 1981

EUSTAQUIO M. MEDALLA, JR., petitioner,

vs.
THE HONORABLE MARCELINO N. SAYO, Judge of the CFI of Rizal, Branch XXXIII and HONORATO G. MACKAY, acting Hospital
Administrator of the Caloocan City General Hospital and the CITY MAYOR OF CALOOCAN, respondents.

MELENCIO-HERRERA, J.:

In this Petition for "Certiorari, mandamus and Prohibition", seeking the dismissal of Civil Case No. C-7770 below, we have, as factual
background, the following:

Petitioner, Dr. Eustaquio M. Medalla, Jr., is the Chief of Clinics of the Caloocan City General Hospital, Caloocan City. Private
respondent,, Dr. Honorato G. Mackay was the Resident Physician thereat.

When the position of Assistant, hospital Administrator of the Caloocan City General Hospital became vacant upon the resignation of the
incumbent, former Caloocan City Mayor Alejandro A. Fider designated and subsequently appointed, as Assistant Hospital Administrator
private respondent Dr. Mackay, a Resident Physician in said hospital. Petitioner, Dr. Medalla, Jr., protested Dr. Mackay's designation and
subsequent appointment alleging among others that, as Chief of Clinics, he (Medalla) was next-in-rank. The then Acting City Mayor
Virgilio P. Robles, who succeeded former Mayor, now Assemblyman Alejandro A. Fider, in his 4th Indorsement dated September 20,
1978, sustained Mackay's appointment stating:

... as of April 18, 1978 when Dr. Honorato G. Mackay was promoted to Assistant Hospital Administrator from his
previous position of Resident Physician, he was next in rank to the said higher position by reason of his having
completed all academic requirements for the Certificate in Hospital Administration ... contrary to the claim of Dr.
Eustaquio Medalla, Jr. in his letter of May 2, 1978.

xxx xxx xxx

Dissatisfied, Medalla elevated his case to the Civil Service Commission on appeal. On December 29, 1978, the Civil Service Merit
Systems Board issued Resolution No. 49 sustaining Medalla's appeal and revoking Mackay's appointment as Assistant Hospital
Administrator. The pertinent portion of the aforestated Resolution reads:

A perusal of the records shows that appellant Medalla is the Chief of Clinics of the Caloocan City General Hospital; he
is a holder of the Degree of Doctor of Medicine; he has completed the requirements in Hospital Administration and is
recommended for the title of Certificate in Hospital Administration; he is also a candidate of a Masters degree in
Hospital Administration He possesses the First Grade eligibility (BA 1080) and had undergone relevant training in
Hospital Administration. His performance rating is 'Very Satisfactory'.

On the other hand, appellee Mackay had been a Resident Physician, the position he held prior to his promotion to the
contested position. He is a holder of the degree of Doctor of Medicine and is a First Grade eligible (BA 1080-Medical
Board). He is a graduate student in Hospital Administration and as completed all academic requirements for a
certificate in Hospital Administration. His performance rating is "Very Satisfactory".

A perusal of the organizational chart of the Ospital ng Caloocan approved by the Hospital Administrator would show
that the Chief of Clinics is the next lower position to the Assistant Hospital Administrator. The Resident Physician is not
a next lower position to the Assistant Hospital Administrator. Therefore, Medalla and not Mackay is the person next in
rank who may be promoted to the position involved.

Moreover, even on the basis of competence and qualifications to perform the duties of the position, the records show
that Dr. Medalla is more competent and qualified than Dr. Mackay. The qualification relied upon by the Acting City
Mayor in justifying the appointment of Dr. Mackay which is his having completed the academic requirements for the
Certificate in Hospital Administration does not give Dr. Mackay the advantage inasmuch as Dr. Medalla has also
completed the academic requirements for a certificate in Hospital Administration and is recommended for a title of
Certificate in Hospital Administration apart from being also a candidate for a Masters degree in Hospital
Administration. 1

xxx xxx xxx

Upon automatic review by the Office of the President, pursuant to section 19(6), PD No. 807, Presidential Executive Assistant Jacobo C.
Clave rendered a Decision on April 24, 1979 declaring that:
 WHEREFORE, premises considered, and as recommended by Civil Service Commission, the appointment of Dr.
Honorato G. Mackay as Assistant Hospital Administrator in the Caloocan City General Hospital is hereby revoked and
the position awarded in favor of appellant Dr. Eustaquio M. Medalla. 2

The Acting City Mayor, on behalf of Mackay, moved for reconsideration.

On May 7, 1979, totally disregarding the Decision of the Office of the President, the same Acting City Mayor appointed Mackay, this time
as Hospital Administrator, and designated Dr. Tantoco as his Assistant, thereby again completely bypassing Medalla. Mackay took his
oath of office on May 7, 1979.

On June 27, 1979, however, the Civil Service Commission, acting on Medalla's protest, and besides calling attention to the penal
provision of P.D. No. 807, disapproved Mackay's appointment as follows:

Wherefore, premises considered and finding the protest of Dr. Medalla in order, the appointment of Dr. Mackay as
hospital Administrator at P26,388 per annum effective May 7, 1979 is hereby disapproved. it is hereby ordered that Dr.
Medalla be appointed to the position of Hospital Administrator of the Caloocan City General Hospital. 3

On July 20, 1979, Mackay moved for reconsideration asserting 1) denial of due process of law inasmuch as the contested
Resolution/Decisions were issued ex-parte, and 2) that the Civil Service Commission can not ignore nor overrule an appointment made
by a City Executive.

Without awaiting the resolution of his Motion for Consideration- Mackay filed, on July 23, 1979, before tile Court of First Instance of
Rizal, Caloocan City, presided by respondent, Judge, a Petition for "Certiorari, Prohibition and mandamus with Preliminary Injunction
and Damages" civil Case No. C7770) against Hon. Jacobo Clave, the Civil Service Commission, the Acting City Mayor, the City
Treasurer, and Medalla, praying that said respondents be restrained from implementing the Decision of Hon. Jacobo Clave of April 24,
1979, the Resolution No. 49 of the Merit Systems Board dated December 29, 1978, and the Decision of the Civil Service Commission of
June 27, 1979. The Court a quo issued the Restraining Order prayed for on July 25, 1979 enjoining implementation of the aforestated
Resolution/Decisions.

On August 2, 1979, Medalla moved to dissolve the Restraining Order and to dismiss the Petition alleging mainly that Mackay had not
exhausted his administrative remedies and that the latter's right to a Writ of Preliminary Injunction was not only dubious or debatable but
was clearly non-existent. Hon. Jacobo Clave and the Civil Service Commission likewise filed a Motion to Dismiss on the same ground of
failure to exhaust administrative remedies.

On August 13, 1979, Mackay moved to suspend proceedings pending final resolution by the Civil Service Commission of his Motion for
the reconsideration of the Decision of said Commission dated June 27, 1979.

On September 24, 1979, the Trial Court denied both Motions to Dismiss filed by Medalla, on the one hand, and Hon. Clave and the Civil
Service Commission, on the other, holding that Mackay's failure to await resolution of his Motions for Reconsideration pending before
the Office of the President and the Civil Service Commission did not deprive him of a cause of action besides the fact that according to
the respective Manifestations of the said Offices, the Motions for Reconsideration had already been resolved adversely against Mackay.

Acting on Medalla's Motion for Reconsideration thereof as well as his Motion to Lift Restraining Order, the Court a quo, in its Order of
July 15, 1980, denied reconsideration but lifted the Restraining Order "there being no showing that petitioner is entitled to the issuance
of a Writ of Preliminary Injunction. " Respondent Judge then set the case for hearing.

At this juncture, Medalla instituted this Petition before us praying that the Court a quo be restrained from proceeding with the hearing
and that judgment be rendered as follows:

1. Ordering the Honorable Marcelino N. Sayo, Judge of the Court of First Instance of Rizal Branch
XXXIII, Caloocan City, to dismiss respondent Mackay's petitions, on the ground of lack of jurisdiction
and/or non- exhaustion of administrative remedies resulting to a lack of cause of action;

2. Declaring the decision of the Office of the President (Annex "C") and the Merit Systems Board
(Annex "E") as valid and enforceable. 4

We issued a Restraining Order on August 27, 1980 enjoining respondents from proceeding with the case below.

On November 7, 1980, we required petitioner Medalla to implead the Mayor of Caloocan City as party-respondent, and the latter to
comment on the Petition and to state whether he is ready to issue an appointment to Medalla as Hospital Administrator, Medalla's rights
thereto having been upheld by the Civil Service Merit Systems Board and by the Office of the President.

In his Compliance, Medalla included an additional prayer that the City Mayor of Caloocan be ordered to immediately appoint him as
Hospital Administrator and to pay him salary differentials.

In his Comment, the City Mayor of Caloocan invoked the privilege of an appointing authority to determine who can best fulfill the
functions of an office citing the case of Aguilar vs. Nieva, Jr. 5 to that effect. And as to the matter of his readiness to issue an
appointment to Medalla, he manifested his preference to withhold action pending Mackay's unresolved Motion for Reconsideration of the
Decision of June 27, 1979 of the Civil Service Merit Systems Board.
Petitioner Medalla submits that the Trial Court erred in not dismissing Mackay's Petition before it, there being a clear showing of non-
exhaustion of administrative remedies, and that said Court was devoid of jurisdiction in reviewing on certiorari decisions of the Office of
the President and of the Civil service Commission rendered in the exercise of their quasi-judicial functions.

Private respondent Mackay takes the contrary view and prays, instead, that the contested Decisions/Resolution be declared null and
void and respondent Judge ordered to proceed with the hearing of the case below.

Although Mackay's Motions for Reconsideration were, in fact, still pending resolution by Hon. Jacobo C. Clave and the Civil Service
Commission, respectively, at the time private respondent Mackay filed the Petition below, dismissal of said Petition can no longer be
anchored on the ground of non-exhaustion of administrative remedies, as Medalla prays, considering that Manifestations dated August
17 and 23, 1979 filed by the said parties before the Court a quo show that they had resolved the incidents adversely against
Mackay. 6 That issue, therefore, has become moot and academic.

In so far as jurisdiction of the Court below to review by certiorari decisions and/or resolutions of the Civil Service Commission and of the
Presidential Executive Assistant is concerned, there should be no question but that the power of judicial review should be upheld. The
following rulings buttress this conclusion:

The objection to a judicial review of a Presidential act arises from a failure to recognize the most important principle in
our system of government, i.e., the separation of powers into three coequal departments, the executive, the legislative
and the judicial, each supreme within its own assigned powers and duties. When a presidential act is challenged
before the courts of justice, it is not to be implied therefrom that the Executive is being made subject and subordinate
to the courts. The legality of his acts are under judicial review, not because the Executive is inferior to the courts, but
because the law is above the Chief Executive himself, and the courts seek only to interpret, apply or implement it (the
law). A judicial review of the President's decision on a case of an employee decided by the Civil Service Board of
Appeals should be viewed in this light and the bringing of the case to the Courts should be governed by the same
principles as govern the judicial review of all administrative acts of all administrative officers. 7

The courts may always examine into the exercise of power by a ministerial officer to the extent of determining whether
the particular power has been granted to the officer, whether it is a legal power that could have been granted to him,
and whether it has been exercised in a legal manner. This jurisdiction does not depend upon an act of the legislature
authorizing it, but inheres in the courts of general jurisdiction as an essential function of the judicial department (State
Racing Commission v. Latonia Agri. Asso. 123 SW 68 1). 8 (emphasis supplied).

For the speedy determination of the controversy, however, and considering that the position involved is infused with public interest,
rather than remand the case to the Court below for further proceedings, we hold that grave abuse of discretion on the part of Hon.
Jacobo C. Clave and the Civil Service Merit Systems Board is absent.

To start with, under the Revised Charter of the City of Caloocan RA No. 5502), it is clear that the power of appointment by the City
Mayor of heads of offices entirely paid out of city funds is subject to Civil Service law, rules and regulations (ibid., section 19). The
Caloocan City General Hospital is one of the city departments provided for in the said law (ibid., sec. 17). The Hospital Administrator is
appointed by the City Mayor (ibid., section 66-B). The Hospital Administrator is the head of the City General Hospital empowered to
administer, direct, and coordinate all activities of the hospital to carry out its objectives as to the care of the sick and the injured (ibid.).

Under section 19 (3) of the Civil Service Decree (PD No. 807, effective on October 6, 1975), the recruitment or selection of employees
for promotions is drawn from the next-in-rank.

SEC. 19. Recruitment and Selection of Employees. —

xxx xxx xxx

(3) When a vacancy occurs in a position in the second level of the Career Service as defined in Section 7, the
employees in the government service who occupy the next lower positions i the occupational group under which the
vacant position is classified and in other functionally related occupational groups and who are competent, qualified
and with the appropriate civil service eligibility shall be considered for promotion.

Section 19 (6) of the same Decree provides for the administrative procedure by an aggrieved employee in case of non-observance by
the appointing authority of the next-in-rank rule, thus:

Sec. 19(6) A qualified next-in-rank employee shall have the right to appeal initially, to the department head and finally
to the Office of the President an appointment made ... (2. in favor of one who is not next-in-rank, ... if the employee
making the appeal is not satisfied with the written special reason or reasons given by the appointing authority for such
appointment: ... Before deciding a contested appointment the Office of the President shall consult the Civil Service
Commission. For purposes of this Section, .qualified next-in-rank' refers to an employee appointed on a permanent
basis to a position previously determined to be next-in- rank to the vacancy proposed to be filled and who meets the
requisites for appointment thereto as previously determined by the appointing authority and approved by the
Commission.

The prescribed procedure has been followed by petitioner Medalla He had appealed to the department head and from thence, in view of
the latter's unfavorable action, to the Civil Service Commission and thereafter to the Office of the President. Resolution No. 49 of the
Civil Service Merit Systems Board its Decision of June 27, 1979, and the Decision of the presidential Executive Assistant dated April 24,
1979, were all rendered in Medalla's favor. The special reason given by the Acting City Mayor for Mackay's appointment, which is, that
lie had completed all academic requirements for the Certificate of Hospital Administration, is not tenable, since Medalla himself was
found to be in possession of the same qualification. But while the qualifications of both petitioner Medalla and private respondent
Mackay are at par, yet, it is clear that the position of Chief of Clinics is the next lower position to I hospital Administrator under the
organizational line-up of the hospital. Consequently, at the time of Mackays appointment as Assistant Hospital Administrator and
subsequently hospital Administrator, Medalla outranked Mackay who was only a Resident Physician and, therefore, as the next-in rank,
Medalla is entitled to appointment as Hospital Administrator.

Respondent Mackay's urging that he was denied due process deserves scant consideration considering that subsequent developsments
in the case establish that he was heardon his Motions for Reconsideration by both the Civil Service Commission and the office of the
President.

It is true that, as the respondent City Mayor alleges, a local executive should be allowed the choice of men of his confidence, provided
they are qualified and elligible, who in his best estimation are possesses of the requisite reputation, integrity, knowledgeability, energy
and judgement. 9 However, as reproduced heretofore, the Decision of the Civil Service Merit Systems Board, upheld by the Office of the
President, contains a judicious assessment of the qualifications of both petitioner Medalla and private respondent Mackay for the
contested position, revealing a careful study of the controversy between the parties, which cannot be ignored. The revocation of
Mackay's appointment reveals no arbitrariness nor grave abuse of discretion.

WHEREFORE, 1) the appointment extended to private respondent, Dr. Honorato C. Mackay, as Hospital Administrator is hereby
declared null and void; 2) respondent City Mayor of Caloocan City is hereby ordered to extend an appointment to petitioner, Dr.
Eustaquio M. Medalla, as Hospital Administrator of the Caloocan City General Hospital immediately upon notice of this Decision; 3)
petitioner, Dr. Eustaquio M. Medalla, shall receive all compensation and emoluments appertaining to said position thenceforth, but
without entitlement to salary differentials; and 4) respondent Judge is hereby permanently enjoined from further proceeding with Civil
Case No. 7770.

This Decision is immediately executory. No costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. L-30637 July 16, 1987

LIANGA BAY LOGGING, CO., INC., petitioner,

vs.
HON. MANUEL LOPEZ ENAGE, in his capacity as Presiding Judge of Branch II of the Court of First, Instance of Agusan, and
AGO TIMBER CORPORATION, respondents.

TEEHANKEE, C.J.:

The Court grants the petition for certiorari and prohibition and holds that respondent judge, absent any showing of grave abuse of
discretion, has no competence nor authority to review anew the decision in administrative proceedings of respondents public officials
(director of forestry, secretary of agriculture and natural resources and assistant executive secretaries of the Office of the President) in
determining the correct boundary line of the licensed timber areas of the contending parties. The Court reaffirms the established
principle that findings of fact by an administrative board or agency or official, following a hearing, are binding upon the courts and will not
be disturbed except where the board, agency and/or official(s) have gone beyond their statutory authority, exercised unconstitutional
powers or clearly acted arbitrarily and without regard to their duty or with grave abuse of discretion.

The parties herein are both forest concessionaries whose licensed areas are adjacent to each other. The concession of petitioner Lianga
Bay Logging Corporation Co., Inc. (hereinafter referred to as petitioner Lianga) as described in its Timber License Agreement No. 49, is
located in the municipalities of Tago, Cagwait, Marihatag and Lianga, all in the Province of Surigao, consisting of 110,406 hectares, more
or less, while that of respondent Ago Timber Corporation (hereinafter referred to as respondent Ago) granted under Ordinary Timber
License No. 1323-60 [New] is located at Los Arcos and San Salvador, Province of Agusan, with an approximate area of 4,000 hectares.
It was a part of a forest area of 9,000 hectares originally licensed to one Narciso Lansang under Ordinary Timber License No. 584-'52.

Since the concessions of petitioner and respondent are adjacent to each other, they have a common boundary-the Agusan-Surigao
Provincial boundary-whereby the eastern boundary of respondent Ago's concession is petitioner Lianga's western boundary. The
western boundary of petitioner Lianga is described as "... Corner 5, a point in the intersection of the Agusan-Surigao Provincial boundary
and Los Arcos-Lianga Road; thence following Agusan-Surigao Provincial boundary in a general northerly and northwesterly and
northerly directions about 39,500 meters to Corner 6, a point at the intersection of the Agusan-Surigao Provincial boundary and
Nalagdao Creek ..." The eastern boundary of respondent Ago's concession is described as "... point 4, along the Agusan-Surigao
boundary; thence following Agusan-Surigao boundary in a general southeasterly and southerly directions about 12,000 meters to point
5, a point along Los Arcos-Lianga Road; ..." 1

Because of reports of encroachment by both parties on each other's concession areas, the Director of Forestry ordered a survey to
establish on the ground the common boundary of their respective concession areas. Forester Cipriano Melchor undertook the survey
and fixed the common boundary as "Corner 5 of Lianga Bay Logging Company at Km. 10.2 instead of Km. 9.7 on the Lianga-Arcos
Road and lines N900E, 21,000 meters; N12 W, 21,150 meters; N40 W, 3,000 meters; N31 W, 2,800 meters; N50 W, 1,700 meters"
which respondent Ago protested claiming that "its eastern boundary should be the provincial boundary line of Agusan-Surigao as
described in Section 1 of Art. 1693 of the Philippine Commission as indicated in the green pencil in the attached sketch" of the areas as
prepared by the Bureau of Forestry. 2 The Director of Forestry, after considering the evidence, found:

That the claim of the Ago Timber Corporation portrays a line (green line) far different in alignment with the line (red) as
indicated in the original License Control Map of this Office;

That the claim of the Ago Timber Corporation (green line does not conform to the distance of 6,800 meters from point 3 to point
4 of the original description of the area of Narciso Lansang but would project said line to a distance of approximately 13,800
meters;

That to follow the claim of the Ago Timber Corporation would increase the area of Narciso Lansang from 9,000 to 12,360
hectares;

That to follow the claim of the Ago Timber Corporation would reduce the area of the Lianga Bay Logging, Co., Inc. to 107,046
hectares instead of the area granted which is 110,406 hectares.

and ruled that "the claim of the Ago Timber Corporation runs counter to the intentions of this Office is granting the license of Mr. Narciso
Lansang; and further, that it also runs counter to the intentions of this Office in granting the Timber License Agreement to the Lianga Bay
Logging Co., Inc. The intentions of this Office in granting the two licenses (Lansang and Lianga Bay Logging Co., Inc.) are patently
manifest in that distances and bearings are the controlling factors. If mention was ever made of the Agusan-Surigao boundary, as the
common boundary line of both licensees, this Office could not have meant the Agusan-Surigao boundary as described under Section 1
of Act 1693 of the Philippine Commission for were it so it could have been so easy for this Office to mention the distance from point 3 to
point 4 of Narciso Lansang as approximately 13,800 meters. This cannot be considered a mistake considering that the percentage of
error which is more or less 103% is too high an error to be committed by an Office manned by competent technical men. The Agusan-
Surigao boundary as mentioned in the technical descriptions of both licensees, is, therefore, patently an imaginary line based on B.F.
License Control Map. Such being the case, it is reiterated that distance and bearings control the description where an imaginary line
exists. 3The decision fixed the common boundary of the licensed areas of the Ago Timber Corporation and Lianga Bay Logging Co., Inc.
as that indicated in red pencil of the sketch attached to the decision.
In an appeal interposed by respondent Ago, docketed in the Department of Agriculture and Natural Resources as DANR Case No. 2268,
the then Acting Secretary of Agriculture and Natural Resources Jose Y. Feliciano, in a decision dated August 9, 1965 set aside the
appealed decision of the Director of Forestry and ruled that "(T)he common boundary line of the licensed areas of the Ago Timber
Corporation and the Lianga Bay Logging Co., Inc., should be that indicated by the green line on the same sketch which had been made
an integral part of the appealed decision." 4

Petitioner elevated the case to the Office of the President, where in a decision dated June 16, 1966, signed by then Assistant Executive
Secretary Jose J. Leido, Jr., the ruling of the then Secretary of Agriculture and Natural Resources was affirmed. 5 On motion for
reconsideration, the Office of the President issued another decision dated August 9, 1968 signed by then Assistant Executive Secretary
Gilberto Duavit reversing and overturning the decision of the then Acting Secretary of Agriculture and Natural Resources and affirming in
toto and reinstating the decision, dated March 20, 1961, of the Director of Forestry. 6

Respondent Ago filed a motion for reconsideration of the decision dated August 9, 1968 of the Office of the President but after written
opposition of petitioner Lianga, the same was denied in an order dated October 2, 1968, signed by then Assistant Executive Secretary
Jose J. Leido, Jr. 7

On October 21, 1968, a new action was commenced by Ago Timber Corporation, as plaintiff, in the Court of First Instance of Agusan,
Branch II, docketed thereat as Civil Case No. 1253, against Lianga Bay Logging Co., Inc., Assistant Executive Secretaries Jose J. Leido,
Jr. and Gilberto M. Duavit and Director of Forestry, as defendants, for "Determination of Correct Boundary Line of License Timber Areas
and Damages with Preliminary Injunction" reiterating once more the same question raised and passed upon in DANR Case No. 2268
and insisting that "a judicial review of such divergent administrative decisions is necessary in order to determine the correct boundary
fine of the licensed areas in question." 8

As prayed for, respondent judge issued a temporary restraining order on October 28, 1968, on a bond of P20,000, enjoining the
defendants from carrying out the decision of the Office of the President. The corresponding writ was issued the next day, or on October
29, 1968. 9

On November 10, 1968, defendant Lianga (herein petitioner) moved for dismissal of the complaint and for dissolution of the temporary
restraining order on grounds that the complaint states no cause of action and that the court has no jurisdiction over the person of
respondent public officials and respondent corporation. It also submitted its opposition to plaintiff's (herein respondent prayer for the
issuance of a writ of preliminary injunction. 10 A supplemental motion was filed on December 6, 1968. 11

On December 19, 1968, the lower court issued an order denying petitioner Lianga's motion to dismiss and granting the writ of
preliminary injunction prayed for by respondent Ago. 12 Lianga's Motion for Reconsideration of the Order was denied on May 9,
1969. 13 Hence, this petition praying of the Court (a) to declare that the Director of Forestry has the exclusive jurisdiction to determine
the common boundary of the licensed areas of petitioners and respondents and that the decision of the Office of the President dated
August 9, 1968 is final and executory; (b) to order the dismissal of Civil Case No. 1253 in the Court of First Instance of Agusan; (c) to
declare that respondent Judge acted without jurisdiction or in excess of jurisdiction and with grave abuse of discretion, amounting to lack
of jurisdiction, in issuing the temporary restraining order dated October 28, 1968 and granting the preliminary injunction per its Order
dated December 19, 1968; and (d) to annul the aforementioned orders.

After respondent's comments on the petition and petitioner's reply thereto, this Court on June 30, 1969 issued a restraining order
enjoining in turn the enforcement of the preliminary injunction and related orders issued by the respondent court in Civil Case No.
1253. 14

The Court finds merit in the petition.

Respondent Judge erred in taking cognizance of the complaint filed by respondent Ago, asking for the determination anew of the correct
boundary fine of its licensed timber area, for the same issue had already been determined by the Director of Forestry, the Secretary of
Agriculture and Natural Resources and the Office of the President, administrative officials under whose jurisdictions the matter properly
belongs. Section 1816 of the Revised Administrative Code vests in the Bureau of Forestry, the jurisdiction and authority over the
demarcation, protection, management, reproduction, reforestation, occupancy, and use of all public forests and forest reserves and over
the granting of licenses for game and fish, and for the taking of forest products, including stone and earth therefrom. The Secretary of
Agriculture and Natural Resources, as department head, may repeal or in the decision of the Director of Forestry when advisable in the
public interests, 15 whose decision is in turn appealable to the Office of the President. 16

In giving due course to the complaint below, the respondent court would necessarily have to assess and evaluate anew all the evidence
presented in the administrative proceedings, 17 which is beyond its competence and jurisdiction. For the respondent court to consider
and weigh again the evidence already presented and passed upon by said officials would be to allow it to substitute its judgment for that
of said officials who are in a better position to consider and weigh the same in the light of the authority specifically vested in them by law.
Such a posture cannot be entertained, for it is a well-settled doctrine that the courts of justice will generally not interfere with purely
administrative matters which are addressed to the sound discretion of government agencies and their expertise unless there is a clear
showing that the latter acted arbitrarily or with grave abuse of discretion or when they have acted in a capricious and whimsical manner
such that their action may amount to an excess or lack of jurisdiction. 18

A doctrine long recognized is that where the law confines in an administrative office the power to determine particular questions or
matters, upon the facts to be presented, the jurisdiction of such office shall prevail over the courts. 19

The general rule, under the principles of administrative law in force in this jurisdiction, is that decisions of administrative officers shall not
be disturbed by the courts, except when the former have acted without or in excess of their jurisdiction, or with grave abuse of discretion.
Findings of administrative officials and agencies who have acquired expertise because their jurisdiction is confined to specific matters
are generally accorded not only respect but at times even finality of such findings are supported by substantial evidence. 20 As recently
stressed by the Court, "in this era of clogged court dockets, the need for specialized administrative boards or commissions with the
special knowledge, experience and capability to hear and determine promptly disputes on technical matters or essentially factual
matters, subject to judicial review in case of grave abuse of discretion, has become well nigh indispensable." 21

The facts and circumstances in the instant case are similar to the earlier case of Pajo, et al. v. Ago, et al. 22(where therein respondent
Pastor Ago is the president of herein respondent Ago Timber Corporation). In the said case, therein respondent Pastor Ago, after an
adverse decision of the Director of Forestry, Secretary of Agriculture and Natural Resources and Executive Secretary in connection with
his application for renewal of his expired timber licenses, filed with the Court of First instance of Agusan a petition for certiorari,
prohibition and damages with preliminary injunction alleging that the rejection of his application for renewal by the Director of Forestry
and Secretary of Agriculture and Natural Resources and its affirmance by the Executive Secretary constituted an abuse of discretion and
was therefore illegal. The Court held that "there can be no question that petitioner Director of Forestry has jurisdiction over the grant or
renewal of respondent Ago's timber license (Sec. 1816, Rev. Adm. Code); that petitioner Secretary of Agriculture and Natural Resources
as department head, is empowered by law to affirm, modify or reject said grant or renewal of respondent Ago's timber license by
petitioner Director of Forestry (Sec. 79[c], Rev. Adm. Code); and that petitioner Executive Secretary, acting for and in behalf and by
authority of the President has, likewise, jurisdiction to affirm, modify or reverse the orders regarding the grant or renewal of said timber
license by the two aforementioned officials." The Court went on to say that, "(I)n the case of Espinosa, et al. v. Makalintal, et al. (79 Phil.
134; 45 Off. Gaz. 712), we held that the powers granted to the Secretary of Agriculture and Commerce (Natural Resources) by law
regarding the disposition of public lands such as granting of licenses, permits, leases, and contracts or approving, rejecting, reinstating,
or cancelling applications or deciding conflicting applications, are all executive and administrative in nature. It is a well-recognized
principle that purely administrative and discretionary functions may not be interfered with by the courts. In general, courts have no
supervising power over the proceedings and actions of the administrative departments of the government. This is generally true with
respect to acts involving the exercise of judgment or discretion, and findings of act. Findings of fact by an administrative board, agency
or official, following a hearing, are binding upon the courts and will not be disturbed except where the board, agency or official has gone
beyond his statutory authority, exercised unconstitutional powers or clearly acted arbitrarily and without regard to his duty or with grave
abuse of discretion. And we have repeatedly held that there is grave abuse of discretion justifying the issuance of the writ of certiorari
only when there is capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. (Abad Santos v. Province of
Tarlac, 67 Phil. 480; Tan vs. People, 88 Phil. 609)"

Respondent Ago contends that the motion filed by petitioner Lianga for reconsideration of the decision of the Office of the President was
denied in an alleged "decision" dated August 15, 1966, allegedly signed by then Assistant Executive Secretary Jose J. Leido, Jr. that,
"however, for some mysterious, unknown if not anomalous reasons and/or illegal considerations, the "decision" allegedly dated August
15, 1966(Annex "D") was never released" and instead a decision was released on August 9, 1968, signed by then Assistant Executive
Secretary Gilberto M. Duavit, which reversed the findings and conclusions of the Office of the President in its first decision dated June
16, 1966 and signed by then Assistant Executive Secretary Leido.

It is elementary that a draft of a decision does not operate as judgment on a case until the same is duly signed and delivered to the clerk
for filing and promulgation. A decision cannot be considered as binding on the parties until its promulgation. 23 Respondent should be
aware of this rule. In still another case of Ago v. Court of Appeals, 24 (where herein respondent Ago was the petitioner) the Court held
that, "While it is to be presumed that the judgment that was dictated in open court will be the judgment of the court, the court may still
modify said order as the same is being put into writing. And even if the order or judgment has already been put into writing and signed,
while it has not yet been delivered to the clerk for filing, it is stin subject to amendment or change by the judge. It is only when the
judgment signed by the judge is actually filed with the clerk of court that it becomes a valid and binding judgment. Prior thereto, it could
still be subject to amendment and change and may not, therefore, constitute the real judgment of the court."

Respondent alleges "that in view of the hopelessly conflicting decisions of the administrative bodies and/or offices of the Philippine
government, and the important questions of law and fact involved therein, as well as the well-grounded fear and suspicion that some
anomalous, illicit and unlawful considerations had intervened in the concealment of the decision of August 15, 1966 (Annex "D") of
Assistant Executive Secretary Gilberto M. Duavit, a judicial review of such divergent administrative decisions is necessary in order to
determine the correct boundary line of the licensed areas in question and restore the faith and confidence of the people in the actuations
of our public officials and in our system of administration of justice."

The mere suspicion of respondent that there were anomalies in the non-release of the Leido "decision" allegedly denying petitioner's
motion for reconsideration and the substitution thereof by the Duavit decision granting reconsideration does not justify judicial review.
Beliefs, suspicions and conjectures cannot overcome the presumption of regularity and legality of official actions. 25 It is presumed that
an official of a department performs his official duties regularly. 26 It should be noted, furthermore, that as hereinabove stated with regard
to the case history in the Office of the President, Ago's motion for reconsideration of the Duavit decision dated August 9, 1968 was
denied in the Order dated October 2, 1968 and signed by Assistant Executive Secretary Leido himself (who thereby joined in the
reversal of his own first decision dated June 16, 1966 and signed by himself).

The Ordinary Timber License No. 1323-'60[New] which approved the transfer to respondent Ago of the 4,000 hectares from the forest
area originally licensed to Narciso Lansang, stipulates certain conditions, terms and limitations, among which were: that the decision of
the Director of Forestry as to the exact location of its licensed areas is final; that the license is subject to whatever decision that may be
rendered on the boundary conflict between the Lianga Bay Logging Co. and the Ago Timber Corporation; that the terms and conditions
of the license are subject to change at the discretion of the Director of Forestry and the license may be made to expire at an earlier date.
Under Section 1834 of the Revised Administrative Code, the Director of Forestry, upon granting any license, may prescribe and insert
therein such terms, conditions, and limitations, not inconsistent with law, as may be deemed by him to be in the public interest. The
license operates as a contract between the government and respondent. Respondent, therefore, is estopped from questioning the terms
and stipulation thereof.

Clearly, the injunctive writ should not have been issued. The provisions of law explicitly provide that Courts of First Instance shall have
the power to issue writ of injunction, mandamus, certiorari, prohibition, quo warranto and habeas corpus in their respective places, 27 if
the petition filed relates to the acts or omissions of an inferior court, or of a corporation, board, officer or person, within their
jurisdiction. 28
The jurisdiction or authority of the Court of First Instance to control or restrain acts by means of the writ of injunction is limited only to
acts which are being committed within the territorial boundaries of their respective provinces or districts 29 except where the sole issue is
the legality of the decision of the administrative officials. 30

In the leading case of Palanan Lumber Plywood Co., Inc. v. Arranz 31 which involved a petition for certiorari and prohibition filed in the
Court of First Instance of Isabela against the same respondent public officials as here and where the administrative proceedings taken
were similar to the case at bar, the Court laid down the rule that: "We agree with the petitioner that the respondent Court acted without
jurisdiction in issuing a preliminary injunction against the petitioners Executive Secretary, Secretary of Agriculture and Natural Resources
and the Director of Forestry, who have their official residences in Manila and Quezon City, outside of the territorial jurisdiction of the
respondent Court of First Instance of Isabela. Both the statutory provisions and the settled jurisdiction of this Court unanimously affirm
that the extraordinary writs issued by the Court of First Instance are limited to and operative only within their respective provinces and
districts."

A different rule applies only when the point in controversy relates solely to a determination of a question of law whether the decision of
the respondent administrative officials was legally correct or not. 32 We thus declared in Director of Forestry v. Ruiz. 33 "In Palanan
Lumber & Plywood Co., Inc., supra, we reaffirmed the rule of non-jurisdiction of courts of first instance to issue injunctive writs in order to
control acts outside of their premises or districts. We went further and said that when the petition filed with the courts of first instance not
only questions the legal correctness of the decision of administrative officials but also seeks to enjoin the enforcement of the said
decision, the court could not validly issue the writ of injunction when the officials sought to be restrained from enforcing the decision are
not stationed within its territory.1avvphi1

"To recapitulate, insofar as injunctive or prohibitory writs are concerned, the rule still stands that courts of first instance have the power to
issue writs limited to and operative only within their respective provinces or districts. "

The writ of preliminary injunction issued by respondent court is furthermore void, since it appears that the forest area described in the
injunctive writ includes areas not licensed to respondent Ago. The forest area referred to and described therein comprises the whole
area originally licensed to Narciso Lansang under the earlier Ordinary Timber License No. 58452. Only a portion of this area was in fact
transferred to respondent Ago as described in its Ordinary Timber License No. 1323-'60[New].

It is abundantly clear that respondent court has no jurisdiction over the subject matter of Civil Case No. 1253 of the Court of First
Instance of Agusan nor has it jurisdiction to decide on the common boundary of the licensed areas of petitioner Lianga and respondent
Ago, as determined by respondents public officials against whom no case of grave abuse of discretion has been made. Absent a cause
of action and jurisdiction, respondent Judge acted with grave abuse of discretion and excess, if not lack, of jurisdiction in refusing to
dismiss the case under review and in issuing the writ of preliminary injunction enjoining the enforcement of the final decision dated
August 9, 1968 and the order affirming the same dated October 2, 1968 of the Office of the President.

ACCORDINGLY, the petition for certiorari and prohibition is granted. The restraining order heretofore issued by the Court against
enforcement of the preliminary injunction and related orders issued by respondent judge is the case below is made permanent and the
respondent judge or whoever has taken his place is hereby ordered to dismiss Civil Case No. 1253.

SO ORDERED.
 EN BANC

June 18, 1987

G.R. No. L-75697

VALENTIN TIO doing business under the name and style of OMI ENTERPRISES, petitioner,
vs.
VIDEOGRAM REGULATORY BOARD, MINISTER OF FINANCE, METRO MANILA COMMISSION, CITY MAYOR and CITY
TREASURER OF MANILA, respondents.

Nelson Y. Ng for petitioner.

The City Legal Officer for respondents City Mayor and City Treasurer.

MELENCIO-HERRERA, J.:

This petition was filed on September 1, 1986 by petitioner on his own behalf and purportedly on behalf of other videogram operators
adversely affected. It assails the constitutionality of Presidential Decree No. 1987 entitled "An Act Creating the Videogram Regulatory
Board" with broad powers to regulate and supervise the videogram industry (hereinafter briefly referred to as the BOARD). The Decree
was promulgated on October 5, 1985 and took effect on April 10, 1986, fifteen (15) days after completion of its publication in the Official
Gazette.

On November 5, 1985, a month after the promulgation of the abovementioned decree, Presidential Decree No. 1994 amended the
National Internal Revenue Code providing, inter alia:

SEC. 134. Video Tapes. — There shall be collected on each processed video-tape cassette, ready for playback, regardless of
length, an annual tax of five pesos; Provided, That locally manufactured or imported blank video tapes shall be subject to sales
tax.

On October 23, 1986, the Greater Manila Theaters Association, Integrated Movie Producers, Importers and Distributors Association of
the Philippines, and Philippine Motion Pictures Producers Association, hereinafter collectively referred to as the Intervenors, were
permitted by the Court to intervene in the case, over petitioner's opposition, upon the allegations that intervention was necessary for the
complete protection of their rights and that their "survival and very existence is threatened by the unregulated proliferation of film piracy."
The Intervenors were thereafter allowed to file their Comment in Intervention.

The rationale behind the enactment of the DECREE, is set out in its preambular clauses as follows:

1. WHEREAS, the proliferation and unregulated circulation of videograms including, among others, videotapes, discs,
cassettes or any technical improvement or variation thereof, have greatly prejudiced the operations of moviehouses and
theaters, and have caused a sharp decline in theatrical attendance by at least forty percent (40%) and a tremendous drop in
the collection of sales, contractor's specific, amusement and other taxes, thereby resulting in substantial losses estimated at
P450 Million annually in government revenues;

2. WHEREAS, videogram(s) establishments collectively earn around P600 Million per annum from rentals, sales and
disposition of videograms, and such earnings have not been subjected to tax, thereby depriving the Government of
approximately P180 Million in taxes each year;

3. WHEREAS, the unregulated activities of videogram establishments have also affected the viability of the movie industry,
particularly the more than 1,200 movie houses and theaters throughout the country, and occasioned industry-wide
displacement and unemployment due to the shutdown of numerous moviehouses and theaters;

4. "WHEREAS, in order to ensure national economic recovery, it is imperative for the Government to create an environment
conducive to growth and development of all business industries, including the movie industry which has an accumulated
investment of about P3 Billion;

5. WHEREAS, proper taxation of the activities of videogram establishments will not only alleviate the dire financial condition of
the movie industry upon which more than 75,000 families and 500,000 workers depend for their livelihood, but also provide an
additional source of revenue for the Government, and at the same time rationalize the heretofore uncontrolled distribution of
videograms;
 6. WHEREAS, the rampant and unregulated showing of obscene videogram features constitutes a clear and present danger to
the moral and spiritual well-being of the youth, and impairs the mandate of the Constitution for the State to support the rearing
of the youth for civic efficiency and the development of moral character and promote their physical, intellectual, and social well-
being;

7. WHEREAS, civic-minded citizens and groups have called for remedial measures to curb these blatant malpractices which
have flaunted our censorship and copyright laws;

8. WHEREAS, in the face of these grave emergencies corroding the moral values of the people and betraying the national
economic recovery program, bold emergency measures must be adopted with dispatch; ... (Numbering of paragraphs
supplied).

Petitioner's attack on the constitutionality of the DECREE rests on the following grounds:

1. Section 10 thereof, which imposes a tax of 30% on the gross receipts payable to the local government is a RIDER and the
same is not germane to the subject matter thereof;

2. The tax imposed is harsh, confiscatory, oppressive and/or in unlawful restraint of trade in violation of the due process clause
of the Constitution;

3. There is no factual nor legal basis for the exercise by the President of the vast powers conferred upon him by Amendment
No. 6;

4. There is undue delegation of power and authority;

5. The Decree is an ex-post facto law; and

6. There is over regulation of the video industry as if it were a nuisance, which it is not.

We shall consider the foregoing objections in seriatim.

1. The Constitutional requirement that "every bill shall embrace only one subject which shall be expressed in the title thereof" 1 is
sufficiently complied with if the title be comprehensive enough to include the general purpose which a statute seeks to achieve. It is not
necessary that the title express each and every end that the statute wishes to accomplish. The requirement is satisfied if all the parts of
the statute are related, and are germane to the subject matter expressed in the title, or as long as they are not inconsistent with or
foreign to the general subject and title. 2 An act 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 object." 3 The rule also is
that the constitutional requirement as to the title of a bill should not be so narrowly construed as to cripple or impede the power of
legislation. 4 It should be given practical rather than technical construction. 5

Tested by the foregoing criteria, petitioner's contention that the tax provision of the DECREE is a rider is without merit. That section
reads, inter alia:

Section 10. Tax on Sale, Lease or Disposition of Videograms. — Notwithstanding any provision of law to the contrary, the
province shall collect a tax of thirty percent (30%) of the purchase price or rental rate, as the case may be, for every sale, lease
or disposition of a videogram containing a reproduction of any motion picture or audiovisual program. Fifty percent (50%) of the
proceeds of the tax collected shall accrue to the province, and the other fifty percent (50%) shall acrrue to the municipality
where the tax is collected; PROVIDED, That in Metropolitan Manila, the tax shall be shared equally by the City/Municipality and
the Metropolitan Manila Commission.

xxx xxx xxx

The foregoing provision is allied and germane to, and is reasonably necessary for the accomplishment of, the general object of the
DECREE, which is the regulation of the video industry through the Videogram Regulatory Board as expressed in its title. The tax
provision is not inconsistent with, nor foreign to that general subject and title. As a tool for regulation 6 it is simply one of the regulatory
and control mechanisms scattered throughout the DECREE. The express purpose of the DECREE to include taxation of the video
industry in order to regulate and rationalize the heretofore uncontrolled distribution of videograms is evident from Preambles 2 and
5, supra. Those preambles explain the motives of the lawmaker in presenting the measure. The title of the DECREE, which is the
creation of the Videogram Regulatory Board, is comprehensive enough to include the purposes expressed in its Preamble and
reasonably covers all its provisions. It is unnecessary to express all those objectives in the title or that the latter be an index to the body
of the DECREE. 7

2. Petitioner also submits that the thirty percent (30%) tax imposed is harsh and oppressive, confiscatory, and in restraint of trade.
However, it is beyond serious question that a tax does not cease to be valid merely because it regulates, discourages, or even definitely
deters the activities taxed. 8 The power to impose taxes is one so unlimited in force and so searching in extent, that the courts scarcely
venture to declare that it is subject to any restrictions whatever, except such as rest in the discretion of the authority which exercises
it. 9 In imposing a tax, the legislature acts upon its constituents. This is, in general, a sufficient security against erroneous and oppressive
taxation. 10

The tax imposed by the DECREE is not only a regulatory but also a revenue measure prompted by the realization that earnings of
videogram establishments of around P600 million per annum have not been subjected to tax, thereby depriving the Government of an
additional source of revenue. It is an end-user tax, imposed on retailers for every videogram they make available for public viewing. It is
similar to the 30% amusement tax imposed or borne by the movie industry which the theater-owners pay to the government, but which is
passed on to the entire cost of the admission ticket, thus shifting the tax burden on the buying or the viewing public. It is a tax that is
imposed uniformly on all videogram operators.

The levy of the 30% tax is for a public purpose. It was imposed primarily to answer the need for regulating the video industry, particularly
because of the rampant film piracy, the flagrant violation of intellectual property rights, and the proliferation of pornographic video tapes.
And while it was also an objective of the DECREE to protect the movie industry, the tax remains a valid imposition.

The public purpose of a tax may legally exist even if the motive which impelled the legislature to impose the tax was to favor
one industry over another. 11

It is inherent in the power to tax that a state be free to select the subjects of taxation, and it has been repeatedly held that
"inequities which result from a singling out of one particular class for taxation or exemption infringe no constitutional
limitation". 12 Taxation has been made the implement of the state's police power.13

At bottom, the rate of tax is a matter better addressed to the taxing legislature.

3. Petitioner argues that there was no legal nor factual basis for the promulgation of the DECREE by the former President under
Amendment No. 6 of the 1973 Constitution providing that "whenever in the judgment of the President ... , there exists a grave
emergency or a threat or imminence thereof, or whenever the interim Batasang Pambansa or the regular National Assembly fails or is
unable to act adequately on any matter for any reason that in his judgment requires immediate action, he may, in order to meet the
exigency, issue the necessary decrees, orders, or letters of instructions, which shall form part of the law of the land."

In refutation, the Intervenors and the Solicitor General's Office aver that the 8th "whereas" clause sufficiently summarizes the justification
in that grave emergencies corroding the moral values of the people and betraying the national economic recovery program necessitated
bold emergency measures to be adopted with dispatch. Whatever the reasons "in the judgment" of the then President, considering that
the issue of the validity of the exercise of legislative power under the said Amendment still pends resolution in several other cases, we
reserve resolution of the question raised at the proper time.

4. Neither can it be successfully argued that the DECREE contains an undue delegation of legislative power. The grant in Section 11 of
the DECREE of authority to the BOARD to "solicit the direct assistance of other agencies and units of the government and deputize, for
a fixed and limited period, the heads or personnel of such agencies and units to perform enforcement functions for the Board" is not a
delegation of the power to legislate but merely a conferment of authority or discretion as to its execution, enforcement, and
implementation. "The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to
what it shall be, and conferring authority or discretion as to its execution to be exercised under and in pursuance of the law. The first
cannot be done; to the latter, no valid objection can be made." 14 Besides, in the very language of the decree, the authority of the
BOARD to solicit such assistance is for a "fixed and limited period" with the deputized agencies concerned being "subject to the direction
and control of the BOARD." That the grant of such authority might be the source of graft and corruption would not stigmatize the
DECREE as unconstitutional. Should the eventuality occur, the aggrieved parties will not be without adequate remedy in law.

5. The DECREE is not violative of the ex post facto principle. An ex post facto law is, among other categories, one which "alters the legal
rules of evidence, and authorizes conviction upon less or different testimony than the law required at the time of the commission of the
offense." It is petitioner's position that Section 15 of the DECREE in providing that:

All videogram establishments in the Philippines are hereby given a period of forty-five (45) days after the effectivity of this
Decree within which to register with and secure a permit from the BOARD to engage in the videogram business and to register
with the BOARD all their inventories of videograms, including videotapes, discs, cassettes or other technical improvements or
variations thereof, before they could be sold, leased, or otherwise disposed of. Thereafter any videogram found in the
possession of any person engaged in the videogram business without the required proof of registration by the BOARD, shall be
prima facie evidence of violation of the Decree, whether the possession of such videogram be for private showing and/or public
exhibition.

raises immediately a prima facie evidence of violation of the DECREE when the required proof of registration of any videogram cannot
be presented and thus partakes of the nature of an ex post facto law.

The argument is untenable. As this Court held in the recent case of Vallarta vs. Court of Appeals, et al. 15

... it is now well settled that "there is no constitutional objection to the passage of a law providing that the presumption of
innocence may be overcome by a contrary presumption founded upon the experience of human conduct, and enacting what
evidence shall be sufficient to overcome such presumption of innocence" (People vs. Mingoa 92 Phil. 856 [1953] at 858-59,
citing 1 COOLEY, A TREATISE ON THE CONSTITUTIONAL LIMITATIONS, 639-641). And the "legislature may enact that when
certain facts have been proved that they shall be prima facie evidence of the existence of the guilt of the accused and shift the
burden of proof provided there be a rational connection between the facts proved and the ultimate facts presumed so that the
inference of the one from proof of the others is not unreasonable and arbitrary because of lack of connection between the two
in common experience". 16

Applied to the challenged provision, there is no question that there is a rational connection between the fact proved, which is non-
registration, and the ultimate fact presumed which is violation of the DECREE, besides the fact that the prima facie presumption of
violation of the DECREE attaches only after a forty-five-day period counted from its effectivity and is, therefore, neither retrospective in
character.
6. We do not share petitioner's fears that the video industry is being over-regulated and being eased out of existence as if it were a
nuisance. Being a relatively new industry, the need for its regulation was apparent. While the underlying objective of the DECREE is to
protect the moribund movie industry, there is no question that public welfare is at bottom of its enactment, considering "the unfair
competition posed by rampant film piracy; the erosion of the moral fiber of the viewing public brought about by the availability of
unclassified and unreviewed video tapes containing pornographic films and films with brutally violent sequences; and losses in
government revenues due to the drop in theatrical attendance, not to mention the fact that the activities of video establishments are
virtually untaxed since mere payment of Mayor's permit and municipal license fees are required to engage in business. 17

The enactment of the Decree since April 10, 1986 has not brought about the "demise" of the video industry. On the contrary, video
establishments are seen to have proliferated in many places notwithstanding the 30% tax imposed.

In the last analysis, what petitioner basically questions is the necessity, wisdom and expediency of the DECREE. These considerations,
however, are primarily and exclusively a matter of legislative concern.

Only congressional power or competence, not the wisdom of the action taken, may be the basis for declaring a statute invalid.
This is as it ought to be. The principle of separation of powers has in the main wisely allocated the respective authority of each
department and confined its jurisdiction to such a sphere. There would then be intrusion not allowable under the Constitution if
on a matter left to the discretion of a coordinate branch, the judiciary would substitute its own. If there be adherence to the rule
of law, as there ought to be, the last offender should be courts of justice, to which rightly litigants submit their controversy
precisely to maintain unimpaired the supremacy of legal norms and prescriptions. The attack on the validity of the challenged
provision likewise insofar as there may be objections, even if valid and cogent on its wisdom cannot be sustained. 18

In fine, petitioner has not overcome the presumption of validity which attaches to a challenged statute. We find no clear violation of the
Constitution which would justify us in pronouncing Presidential Decree No. 1987 as unconstitutional and void.

WHEREFORE, the instant Petition is hereby dismissed.

No costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 111812 May 31, 1995

DIONISIO M. RABOR, petitioner,

vs.
CIVIL SERVICE COMMISSION, respondent.

FELICIANO, J.:

Petitioner Dionisio M. Rabor is a Utility Worker in the Office of the Mayor, Davao City. He entered the government service as a Utility
worker on 10 April 1978 at the age of 55 years.

Sometime in May 1991, 1 Alma, D. Pagatpatan, an official in the Office of the Mayor of Davao City, advised Dionisio M. Rabor to apply
for retirement, considering that he had already reached the age of sixty-eight (68) years and seven (7) months, with thirteen (13) years
and one (1) month of government service. Rabor responded to this advice by exhibiting a "Certificate of Membership" 2 issued by the
Government Service Insurance System ("GSIS") and dated 12 May 1988. At the bottom of this "Certificate of Membership" is a
typewritten statement of the following tenor: "Service extended to comply 15 years service reqts." This statement is followed by a non-
legible initial with the following date "2/28/91."

Thereupon, the Davao City Government, through Ms. Pagatpatan, wrote to the Regional Director of the Civil Service Commission,
Region XI, Davao City ("CSRO-XI"), informing the latter of the foregoing and requesting advice "as to what action [should] be taken on
this matter."

In a letter dated 26 July 1991, Director Filemon B. Cawad of CSRO-XI advised Davao City Mayor Rodrigo R. Duterte as follows:

Please be informed that the extension of services of Mr. Rabor is contrary to M.C. No. 65 of the Office of the
President, the relevant portion of which is hereunder quoted:

Officials and employees who have reached the compulsory retirement age of 65 years shall not be
retained the service, except for extremely meritorious reasons in which case the retention shall not
exceed six (6) months.

IN VIEW WHEREFORE, please be advised that the services of Mr. Dominador [M.] Rabor as Utility Worker in that
office, is already non-extend[i]ble. 3

Accordingly, on 8 August l991, Mayor Duterte furnished a copy of the 26 July 1991 letter of Director Cawad to Rabor and advised him "to
stop reporting for work effective August 16, 1991." 4

Petitioner Rabor then sent to the Regional Director, CSRO-XI, a letter dated 14 August 1991, asking for extension of his services in the
City Government until he "shall have completed the fifteen (15) years service [requirement] in the Government so that [he] could also
avail of the benefits of the retirement laws given to employees of the Government." The extension he was asking for was about two (2)
years. Asserting that he was "still in good health and very able to perform the duties and functions of [his] position as Utility Worker,"
Rabor sought "extension of [his] service as an exception to Memorandum Circular No. 65 of the Office of the President." 5 This request
was denied by Director Cawad on 15 August 1991.

Petitioner Rabor next wrote to the Office of the President on 29 January 1992 seeking reconsideration of the decision of Director Cawad,
CSRO-XI. The Office of the President referred Mr. Rabor's letter to the Chairman of the Civil Service Commission on 5 March 1992.

In its Resolution No. 92-594, dated 28 April 1992, the Civil Service Commission dismissed the appeal of Mr. Rabor and affirmed the
action of Director Cawad embodied in the latter's letter of 26 July 1991. This Resolution stated in part:

In his appeal, Rabor requested that he be allowed to continue rendering services as Utility Worker in order to
complete the fifteen (15) year service requirement under P.D. 1146.

CSC Memorandum Circular No. 27, s. 1990 provides, in part:

1. Any request for extension of service of compulsory retirees to complete the fifteen years service
requirement for retirement shall be allowed only to permanent appointees in the career service who
are regular members of the Government Service Insurance System (GSIS) and shall be granted for
a period of not exceeding one (1) year.
 Considering that as early as October 18, 1988, Rabor was already due for retirement, his request for further extension
of service cannot be given due course. 6 (Emphasis in the original)

On 28 October 1992, Mr. Rabor sought reconsideration of Resolution No. 92-594 of the Civil Service Commission this time invoking the
Decision of this Court in Cena v. Civil Service Commission. 7 Petitioner also asked for reinstatement with back salaries and benefits,
having been separated from the government service effective 16 August 1991. Rabor's motion for reconsideration was denied by the
Commission.

Petitioner Rabor sent another letter dated 16 April 1993 to the Office of the Mayor, Davao City, again requesting that he be allowed to
continue rendering service to the Davao City Government as Utility Worker in order to complete the fifteen (15) years service
requirement under P.D. No. 1146. This request was once more denied by Mayor Duterte in a letter to petitioner dated 19 May 1993. In
this letter, Mayor Duterte pointed out that, under Cena grant of the extension of service was discretionary on the part of the City Mayor,
but that he could not grant the extension requested. Mayor Duterte's letter, in relevant part, read:

The matter was referred to the City Legal Office and the Chairman of the Civil Service Commission, in the advent of
the decision of the Supreme Court in the Cena vs. CSC, et al. (G.R. No. 97419 dated July 3, 1992), for legal opinion.
Both the City Legal Officer and the Chairman of the Civil Service Commission are one in these opinion that extending
you an appointment in order that you may be able to complete the fifteen-year service requirement is discretionary [on
the part of] the City Mayor.

Much as we desire to extend you an appointment but circumstances are that we can no longer do so. As you are
already nearing your 70th birthday may no longer be able to perform the duties attached to your position. Moreover,
the position you had vacated was already filled up.

We therefore regret to inform you that we cannot act favorably on your request. 8 (Emphases supplied)

At this point, Mr. Rabor decided to come to this Court. He filed a Letter/Petition dated 6 July 1993 appealing from Civil Service
Resolution No. 92-594 and from Mayor Duterte's letter of 10 May 1993.

The Court required petitioner Rabor to comply with the formal requirements for instituting a special civil action of certiorari to review the
assailed Resolution of the Civil Service Commission. In turn, the Commission was required to comment on petitioner's
Letter/Petition. 9 The Court subsequently noted petitioner's Letter of 13 September 1993 relating to compliance with the mentioned
formal requirements and directed the Clerk of Court to advise petitioner to engage the services of counsel or to ask for legal assistance
from the Public Attorney's Office (PAO). 10

The Civil Service Commission, through the Office of the Solicitor General, filed its comment on 16 November 1993. The Court then
resolved to give due course to the Petition and required the parties to file memoranda. Both the Commission and Mr. Rabor (the latter
through PAO counsel) did so.

In this proceeding, petitioner Rabor contends that his claim falls squarely within the ruling of this Court in Cena v. Civil Service
Commission. 11

Upon the other hand, the Commission seeks to distinguish this case from Cena. The Commission, through the Solicitor General,
stressed that in Cena, this Court had ruled that the employer agency, the Land Registration Authority of the Department of Justice, was
vested with discretion to grant to Cena the extension requested by him. The Land Registration Authority had chosen not to exercise its
discretion to grant or deny such extension. In contrast, in the instant case, the Davao City Government did exercise its discretion on the
matter and decided to deny the extension sought by petitioner Rabor for legitimate reasons.

While the Cena decision is barely three (3) years old, the Court considers that it must reexamine the doctrine of Cena and the theoretical
and policy underpinnings thereof. 12

We start by recalling the factual setting of Cena.

Gaudencio Cena was appointed Registrar of the Register of Deeds of Malabon, Metropolitan Manila, on 16 July 1987. He reached the
compulsory retirement age of sixty-five (65) years on 22 January 1991. By the latter date, his government service would have reached a
total of eleven (11) years, nine (9) months and six (6) days. Before reaching his 65th birthday, Cena requested the Secretary of Justice,
through the Administrator of the Land Registration Authority ("LRA") that he be allowed to extend his service to complete the fifteen-year
service requirement to enable him to retire with the full benefit of an Old-Age Pension under Section 11 (b) of P.D. No. 1146. If Cena's
request were granted, he would complete fifteen (15) years of government service on 15 April 1994, at the age of sixty-eight (68) years.

The LRA Administrator sought a ruling from the Civil Service Commission on whether or not Cena's request could be granted
considering that Cena was covered by Civil Service Memorandum No. 27, Series of 1990. On 17 October 1990, the Commission
allowed Cena a one (1) year extension of his service from 22 January 1991 to 22 January 1992 under its Memorandum Circular No. 27.
Dissatisfied, Cena moved for reconsideration, without success. He then came to this Court, claiming that he was entitled to an extension
of three (3) years, three (3) months and twenty-four (24) days to complete the fifteen-year service requirement for retirement with full
benefits under Section 11 (b) of P.D. No. 1146.

This Court granted Cena' s petition in its Decision of 3 July 1992. Speaking through Mr. Justice Medialdea, the Court held that a
government employee who has reached the compulsory retirement age of sixty-five (65) years, but at the same time has not yet
completed fifteen (15) years of government service required under Section 11 (b) of P.D. No. 1146 to qualify for the Old-Age Pension
Benefit, may be granted an extension of his government service for such period of time as may be necessary to "fill up" or comply with
the fifteen (15)-year service requirement. The Court also held that the authority to grant the extension was a discretionary one vested in
the head of the agency concerned. Thus the Court concluded:
 Accordingly, the Petition is GRANTED. The Land Registration Authority (LRA) and Department of Justice has the
discretion to allow petitioner Gaudencio Cena to extend his 11 years, 9 months and 6 days of government to complete
the fifteen-year service so that he may retire with full benefits under Section 11, paragraph (b) of P.D.
1146. 13 (Emphases supplied)

The Court reached the above conclusion primarily on the basis of the "plain and ordinary meaning" of Section 11 (b) of P.D. No. 1146.
Section 11 may be quoted in its entirety:

Sec. 11 Conditions for Old-Age Pension. — (a) Old-Age Pension shall be paid to a member who

(1) has at least fifteen (15) years of service;

(2) is at least sixty (60) years of age; and

(3) is separated from the service.

(b) unless the service is extended by appropriate authorities, retirement shall be compulsory for an employee at sixty-
five-(65) years of age with at least fifteen (15) years of service; Provided, that if he has less than fifteen (15) years of
service, he shall he allowed to continue in the service to completed the fifteen (15) years. (Emphases supplied)

The Court went on to rely upon the canon of liberal construction which has often been invoked in respect of retirement statutes:

Being remedial in character, a statute granting a pension or establishing [a] retirement plan should be liberally
construed and administered in favor of persons intended to be benefitted thereby. The liberal approach aims to
achieve the humanitarian purposes of the law in order that efficiency, security and well-being of government
employees may be enhanced. 14 (Citations omitted)

While Section 11 (b) appeared cast in verbally unqualified terms, there were (and still are) two (2) administrative issuances which
prescribe limitations on the extension of service that may be granted to an employee who has reached sixty-five (65) years of age.

The first administrative issuance is Civil Service Commission Circular No. 27, Series of 1990, which should be quoted in its entirety:

TO : ALL HEADS OF DEPARTMENTS, BUREAUS AND AGENCIES OF THE NATIONAL/LOCAL GOVERNMENTS

INCLUDING GOVERNMENT- OWNED AND/OR CONTROLLED CORPORATIONS WITH ORIGINAL CHARTERS.

SUBJECT : Extension of Service of Compulsory Retiree to Complete the Fifteen Years Service Requirement for
Retirement Purposes.

Pursuant to CSC Resolution No. 90-454 dated May 21, 1990, the Civil Service Commission hereby adopts and
promulgates the following policies and guidelines in the extension of services of compulsory retirees to complete the
fifteen years service requirement for retirement purposes:

1. Any request for the extension of service of compulsory retirees to complete the fifteen (15) years
service requirement for retirement shall be allowed only to permanent appointees in the career
service who are regular members of the Government Service Insurance System (GSIS), and shall
be granted for a period not exceeding one (1) year.

2. Any request for the extension of service of compulsory retiree to complete the fifteen (15) years
service requirement for retirement who entered the government service at 57 years of age or over
upon prior grant of authority to appoint him or her, shall no longer be granted.

3. Any request for the extension of service to complete the fifteen (15) years service requirement of
retirement shall be filled not later than three (3) years prior to the date of compulsory retirement.

4. Any request for the extension of service of a compulsory retiree who meets the minimum number
of years of service for retirement purposes may be granted for six (6) months only with no further
extension.

This Memorandum Circular shall take effect immediately. (Emphases supplied)

The second administrative issuance — Memorandum Circular No. 65 of the Office of the President, dated 14 June 1988 — provides:

xxx xxx xxx

WHEREAS, this Office has been. receiving requests for reinstatement and/or retention in the service of employees
who have reached the compulsory retirement age of 65 years, despite the strict conditions provided for in
Memorandum Circular No. 163, dated March 5, 1968, as amended.
 WHEREAS, the President has recently adopted a policy to adhere more strictly to the law providing for compulsory
retirement age of 65 years and, in extremely meritorious cases, to limit the service beyond the age of 65 years to six
(6) months only.

WHEREFORE, the pertinent provision of Memorandum Circular No. 163 or on the retention in the service of officials
or employees who have reached the compulsory retirement age of 65 years, is hereby amended to read as follows:

Officials or employees who have reached the compulsory retirement age of 65 years shall not be
retained in the service, except for extremely meritorious reasons in which case the retention shall
not exceed six (6) months.

All heads of departments, bureaus, offices and instrumentalities of the government including government-owned or
controlled corporations, are hereby enjoined to require their respective offices to strictly comply with this circular.

This Circular shall take effect immediately.

By authority of the
President

(Sgd.)

CATALINO MACARAIG,
JR.
Executive Secretary

Manila, June 14, 1988. 15 (Emphasis supplied)

Medialdea, J. resolved the challenges posed by the above two (2) administrative regulations by, firstly, considering as invalid Civil
Service Memorandum No. 27 and, secondly, by interpreting the Office of the President's Memorandum Circular No. 65 as inapplicable to
the case of Gaudencio T. Cena.

We turn first to the Civil Service Commission's Memorandum Circular No. 27. Medialdea, J. wrote:

The Civil Service Commission Memorandum Circular No. 27 being in the nature of an administrative regulation, must
be governed by the principle that administrative regulations adopted under legislative authority by a particular
department must be in harmony with the provisions of the law, and should be for the sole purpose of carrying into
effect its general provisions (People v. Maceren, G.R. No. L-32166, October 18, 1977, 79 SCRA 450; Teoxon v.
Members of the Board of Administrators, L-25619, June 30, 1970, 33 SCRA 585; Manuel v. General Auditing Office, L-
28952, December 29, 1971, 42 SCRA 660; Deluao v. Casteel, L-21906, August 29, 1969, 29 SCRA 350). . . . . The
rule on limiting to one the year the extension of service of an employee who has reached the compulsory retirement
age of sixty-five (65) years, but has less than fifteen (15) years of service under Civil Service Memorandum Circular
No. 27, S. 1990, cannot likewise be accorded validity because it has no relationship or connection with any provision
of P.D. 1146 supposed to be carried into effect. The rule was an addition to or extension of the law, not merely a mode
of carrying it into effect. The Civil Service Commission has no power to supply perceived omissions in P.D.
1146. 16 (Emphasis supplied)

It will be seen that Cena, in striking down Civil Service Commission Memorandum No. 27, took a very narrow view on the question of
what subordinate rule-making by an administrative agency is permissible and valid. That restrictive view must be contrasted with this
Court's earlier ruling in People v. Exconde, 17 where Mr. Justice J.B.L. Reyes said:

It is well established in this jurisdiction that, while the making of laws is a non-delegable activity that corresponds
exclusively to Congress, nevertheless, the latter may constitutionally delegate authority and promulgate rules and
regulations to implement a given legislation and effectuate its policies, for the reason that the legislature often finds it
impracticable (if not impossible) to anticipate and provide for the multifarious and complex situations that may be met
in carrying the law into effect. All that is required is that the regulation should be germane to the objects and purposes
of the law; that the regulation be not in contradiction with it, but conform to standards that the law
prescribes. 18(Emphasis supplied)

In Tablarin v. Gutierrez, 19 the Court, in sustaining the validity of a MECS Order which established passing a uniform admission test
called the National Medical Admission Test (NMAT) as a prerequisite for eligibility for admission into medical schools in the Philippines,
said:

The standards set for subordinate legislation in the exercise of rule making authority by an administrative agency like
the Board of Medical Education are necessarily broad and highly abstract. As explained by then Mr. Justice Fernando
in Edu v. Ericta (35 SCRA 481 [1970]) —

The standards may be either expressed or implied. If the former, the non-delegation objection is
easily met. The Standard though does not have to be spelled out specifically. It could be implied
from the policy and purpose of the act considered as a whole. In the Reflector Law, clearly the
legislative objective is public safety. What is sought to be attained in Calalang v. William is "safe
transit upon the roads."
 We believe and so hold that the necessary standards are set forth in Section 1 of the 1959 Medical Act: "the
standardization and regulation of medical education" and in Section 5 (a) and 7 of the same Act, the body of the
statute itself, and that these considered together are sufficient compliance with the requirements of the non-delegation
principle. 20 (Citations omitted; emphasis partly in the original and partly supplied)

In Edu v. Ericta, 21 then Mr. Justice Fernando stressed the abstract and very general nature of the standards which our Court has in prior
case law upheld as sufficient for purposes of compliance with the requirements for validity of subordinate or administrative rule-making:

This Court has considered as sufficient standards, "public welfare," (Municipality of Cardona v. Municipality of
Binangonan, 36 Phil. 547 [1917]); "necessary in the interest of law and order," (Rubi v. Provincial Board, 39 Phil. 660
[1919]); "public interest," (People v. Rosenthal, 68 Phil. 328 [1939]); and "justice and equity and substantial merits of
the case," (International Hardwood v. Pangil Federation of Labor, 17 Phil. 602 [1940]). 22 (Emphasis supplied)

Clearly, therefore, Cena when it required a considerably higher degree of detail in the statute to be implemented, went against prevailing
doctrine. It seems clear that if the governing or enabling statute is quite detailed and specific to begin with, there would be very little
need (or occasion) for implementing administrative regulations. It is, however, precisely the inability of legislative bodies to anticipate all
(or many) possible detailed situations in respect of any relatively complex subject matter, that makes subordinate, delegated rule-making
by administrative agencies so important and unavoidable. All that may be reasonably; demanded is a showing that the delegated
legislation consisting of administrative regulations are germane to the general purposes projected by the governing or enabling statute.
This is the test that is appropriately applied in respect of Civil Service Memorandum Circular No. 27, Series of 1990, and to this test we
now turn.

We consider that the enabling statute that should appropriately be examined is the present Civil Service law — found in Book V, Title I,
Subtitle A, of Executive Order No. 292 dated 25 July 1987, otherwise known as the Administrative Code of 1987 — and not alone P.D.
No. 1146, otherwise known as the "Revised Government Service Insurance Act of 1977." For the matter of extension of service of
retirees who have reached sixty-five (65) years of age is an area that is covered by both statutes and not alone by Section 11 (b) of P.D.
1146. This is crystal clear from examination of many provisions of the present civil service law.

Section 12 of the present Civil Service law set out in the 1987 Administrative Code provides, in relevant part, as follows:

Sec. 12 Powers and Functions. — The [Civil Service] Commission shall have the following powers and functions:

xxx xxx xxx

(2) Prescribe, amend and enforce rules and regulations for carrying into effect the provisions of the Civil Service
Law and other pertinent laws;

(3) Promulgate policies, standards and guidelines for the Civil Service and adopt plans and programs to
promote economical, efficient and effective personnel administration in the government;

xxx xxx xxx

(10) Formulate, administer and evaluate programs relative to the development and retention of a qualified and
competent work force in the public service;

xxx xxx xxx

(14) Take appropriate action on all appointments and other personnel matters in the Civil Service including extension
of service beyond retirement age;

xxx xxx xxx

(17) Administer the retirement program for government officials and employees, and accredit government services
and evaluate qualifications for retirement;

xxx xxx xxx

(19) Perform all functions properly belonging to a central personnel agency and such other functions as may be
provided by law. (Emphasis supplied)

It was on the bases of the above quoted provisions of the 1987 Administrative Code that the Civil Service Commission promulgated its
Memorandum Circular No. 27. In doing so, the Commission was acting as "the central personnel agency of the government empowered
to promulgate policies, standards and guidelines for efficient, responsive and effective personnel administration in the government." 23 It
was also discharging its function of "administering the retirement program for government officials and employees" and of "evaluat[ing]
qualifications for retirement."

In addition, the Civil Service Commission is charged by the 1987 Administrative Code with providing leadership and assistance "in
the development and retention of qualified and efficient work force in the Civil Service" (Section 16 [10]) and with the "enforcement of the
constitutional and statutory provisions, relative to retirement and the regulation for the effective implementation of the retirement of
government officials and employees" (Section 16 [14]).
We find it very difficult to suppose that the limitation of permissible extensions of service after an employee has reached sixty-five (65)
years of age has no reasonable relationship or is not germane to the foregoing provisions of the present Civil Service Law. The
physiological and psychological processes associated with ageing in human beings are in fact related to the efficiency and quality of the
service that may be expected from individual persons. The policy considerations which guided the Civil Service Commission in limiting
the maximum extension of service allowable for compulsory retirees, were summarized by Griño-Aquino, J. in her dissenting opinion
in Cena:

Worth pondering also are the points raised by the Civil Service Commission that extending the service of compulsory
retirees for longer than one (1) year would: (1) give a premium to late-comers in the government service and in effect
discriminate against those who enter the service at a younger age; (2) delay the promotion of the latter and of next-in-
rank employees; and (3) prejudice the chances for employment of qualified young civil service applicants who have
already passed the various government examination but must wait for jobs to be vacated by "extendees" who have
long passed the mandatory retirement age but are enjoying extension of their government service to complete 15
years so they may qualify for old-age pension. 24 (Emphasis supplied).

Cena laid heavy stress on the interest of retirees or would be retirees, something that is, in itself, quite appropriate. At the same time,
however, we are bound to note that there should be countervailing stress on the interests of the employer agency and of other
government employees as a whole. The results flowing from the striking down of the limitation established in Civil Service Memorandum
Circular No. 27 may well be "absurd and inequitable," as suggested by Mme. Justice Griño-Aquino in her dissenting opinion. An
employee who has rendered only three (3) years of government service at age sixty-five (65) can have his service extended for twelve
(12) years and finally retire at the age of seventy-seven (77). This reduces the significance of the general principle of compulsory
retirement at age sixty-five (65) very close to the vanishing point.

The very real difficulties posed by the Cena doctrine for rational personnel administration and management in the Civil Service, are
aggravated when Cena is considered together with the case of Toledo v. Civil Service Commission. 25 Toledo involved the provisions of
Rule III, Section 22, of the Civil Service Rules on Personnel Action and Policies (CSRPAP) which prohibited the appointment of persons
fifty-seven (57) years old or above in government service without prior approval of the Civil Service Commission. Civil Service
Memorandum Circular No. 5, Series of 1983 provided that a person fifty-seven (57) years of age may be appointed to the Civil Service
provided that the exigencies of the government service so required and provided that the appointee possesses special qualifications not
possessed by other officers or employees in the Civil Service and that the vacancy cannot be filled by promotion of qualified officers or
employees of the Civil Service. Petitioner Toledo was appointed Manager of the Education and Information Division of the Commission
on Elections when he was almost fifty-nine (59) years old. No authority for such appointment had been obtained either from the
President of the Philippines or from the Civil Service Commission and the Commission found that the other conditions laid down in
Section 22 of Rule III, CSRPAP, did not exist. The Court nevertheless struck down Section 22, Rule III on the same exceedingly
restrictive view of permissible administrative legislation that Cena relied on. 26

When one combines the doctrine of Toledo with the ruling in Cena, very strange results follow. Under these combined doctrines, a
person sixty-four (64) years of age may be appointed to the government service and one (1) year later may demand extension of his
service for the next fourteen (14) years; he would retire at age seventy-nine (79). The net effect is thus that the general statutory policy
of compulsory retirement at sixty-five (65) years is heavily eroded and effectively becomes unenforceable. That general statutory policy
may be seen to embody the notion that there should be a certain minimum turn-over in the government service and that opportunities for
government service should be distributed as broadly as possible, specially to younger people, considering that the bulk of our population
is below thirty (30) years of age. That same general policy also reflects the life expectancy of our people which is still significantly lower
than the life expectancy of, e.g., people in Northern and Western Europe, North America and Japan.

Our conclusion is that the doctrine of Cena should be and is hereby modified to this extent: that Civil Service Memorandum Circular No.
27, Series of 1990, more specifically paragraph (1) thereof, is hereby declared valid and effective. Section 11 (b) of P.D. No. 1146 must,
accordingly, be read together with Memorandum Circular No. 27. We reiterate, however, the holding in Cena that the head of the
government agency concerned is vested with discretionary authority to allow or disallow extension of the service of an official or
employee who has reached sixty-five (65) years of age without completing fifteen (15) years of government service; this discretion is,
nevertheless, to be exercised conformably with the provisions of Civil Service Memorandum Circular No. 27, Series of 1990.

We do not believe it necessary to deal specifically with Memorandum Circular No. 65 of the Office of the President dated 14 June 1988.
It will be noted from the text quoted supra (pp. 11-12) that the text itself of Memorandum Circular No. 65 (and for that matter, that of
Memorandum Circular No. 163, also of the Office of the President, dated 5 March 1968) 27 does not purport to apply only to officers or
employees who have reached the age of sixty-five (65) years and who have at least fifteen (l5) years of government service. We noted
earlier that Cena interpreted Memorandum Circular No. 65 as referring only to officers and employees who have both reached the
compulsory retirement age of sixty-five (65) and completed the fifteen (15) years of government service. Cena so interpreted this
Memorandum Circular precisely because Cena had reached the conclusion that employees who have reached sixty-five (65) years of
age, but who have less than fifteen (15) years of government service, may be allowed such extension of service as may be needed to
complete fifteen (15) years of service. In other words, Cena read Memorandum Circular No. 65 in such a way as to comfort
with Cena's own conclusion reached without regard to that Memorandum Circular. In view of the conclusion that we today reached in the
instant case, this last ruling of Cena is properly regarded as merely orbiter.

We also do not believe it necessary to determine whether Civil Service Memorandum Circular No. 27 is fully compatible with Office of
the President's Memorandum Circular No. 65; this question must be reserved for detailed analysis in some future justiciable case.

Applying now the results of our reexamination of Cena to the instant case, we believe and so hold that Civil Service Resolution No. 92-
594 dated 28 April 1992 dismissing the appeal of petitioner Rabor and affirming the action of CSRO-XI Director Cawad dated 26 July
1991, must be upheld and affirmed.

ACCORDINGLY, for all the foregoing, the Petition for Certiorari is hereby DISMISSED for lack of merit. No pronouncement as to costs.

SO ORDERED.
 SECOND DIVISION

[G.R. No. 119528. March 26, 1997]

PHILIPPINE AIRLINES, INC., petitioner, vs. CIVIL AERONAUTICS BOARD and GRAND INTERNATIONAL AIRWAYS,
INC., respondents.

DECISION
TORRES, JR., J.:

This Special Civil Action for Certiorari and Prohibition under Rule 65 of the Rules of Court seeks to prohibit respondent Civil
Aeronautics Board from exercising jurisdiction over private respondent's Application for the issuance of a Certificate of Public
Convenience and Necessity, and to annul and set aside a temporary operating permit issued by the Civil Aeronautics Board in favor of
Grand International Airways (GrandAir, for brevity) allowing the same to engage in scheduled domestic air transportation services,
particularly the Manila-Cebu, Manila-Davao, and converse routes.
The main reason submitted by petitioner Philippine Airlines, Inc. (PAL) to support its petition is the fact that GrandAir does not
possess a legislative franchise authorizing it to engage in air transportation service within the Philippines or elsewhere. Such franchise
is, allegedly, a requisite for the issuance of a Certificate of Public Convenience or Necessity by the respondent Board, as mandated
under Section 11, Article XII of the Constitution.
Respondent GrandAir, on the other hand, posits that a legislative franchise is no longer a requirement for the issuance of a
Certificate of Public Convenience and Necessity or a Temporary Operating Permit, following the Court's pronouncements in the case of
Albano vs. Reyes,[1] as restated by the Court of Appeals in Avia Filipinas International vs. Civil Aeronautics Board [2] and Silangan
Airways, Inc. vs. Grand International Airways, Inc., and the Hon. Civil Aeronautics Board.[3]
On November 24, 1994, private respondent GrandAir applied for a Certificate of Public Convenience and Necessity with the Board,
which application was docketed as CAB Case No. EP-12711. [4]Accordingly, the Chief Hearing Officer of the CAB issued a Notice of
Hearing setting the application for initial hearing on December 16, 1994, and directing GrandAir to serve a copy of the application and
corresponding notice to all scheduled Philippine Domestic operators. On December 14, 1994, GrandAir filed its Compliance, and
requested for the issuance of a Temporary Operating Permit. Petitioner, itself the holder of a legislative franchise to operate air transport
services, filed an Opposition to the application for a Certificate of Public Convenience and Necessity on December 16, 1995 on the
following grounds:

"A. The CAB has no jurisdiction to hear the petitioner's application until the latter has first obtained a franchise to operate from
Congress.

B. The petitioner's application is deficient in form and substance in that:

1. The application does not indicate a route structure including a computation of trunkline, secondary and rural available seat kilometers
(ASK) which shall always be maintained at a monthly level at least 5% and 20% of the ASK offered into and out of the proposed base of
operations for rural and secondary, respectively.

2. It does not contain a project/feasibility study, projected profit and loss statements, projected balance sheet, insurance coverage, list of
personnel, list of spare parts inventory, tariff structure, documents supportive of financial capacity, route flight schedule, contracts on
facilities (hangars, maintenance, lot) etc.

C. Approval of petitioner's application would violate the equal protection clause of the constitution.

D. There is no urgent need and demand for the services applied for.

E. To grant petitioner's application would only result in ruinous competition contrary to Section 4(d) of R.A. 776."[5]

At the initial hearing for the application, petitioner raised the issue of lack of jurisdiction of the Board to hear the application
because GrandAir did not possess a legislative franchise.
On December 20, 1994, the Chief Hearing Officer of CAB issued an Order denying petitioner's Opposition. Pertinent portions of the
Order read:

"PAL alleges that the CAB has no jurisdiction to hear the petitioner's application until the latter has first obtained a franchise to operate
from Congress.

The Civil Aeronautics Board has jurisdiction to hear and resolve the application. In Avia Filipina vs. CAB, CA G.R. No. 23365, it has been
ruled that under Section 10 (c) (I) of R.A. 776, the Board possesses this specific power and duty.

In view thereof, the opposition of PAL on this ground is hereby denied.

SO ORDERED."
 Meantime, on December 22, 1994, petitioner this time, opposed private respondent's application for a temporary permit
maintaining that:

"1. The applicant does not possess the required fitness and capability of operating the services applied for under RA 776; and,

2. Applicant has failed to prove that there is clear and urgent public need for the services applied for."[6]

On December 23, 1994, the Board promulgated Resolution No. 119(92) approving the issuance of a Temporary Operating Permit
in favor of Grand Air [7] for a period of three months, i.e., from December 22, 1994 to March 22, 1994. Petitioner moved for the
reconsideration of the issuance of the Temporary Operating Permit on January 11, 1995, but the same was denied in CAB Resolution
No. 02 (95) on February 2, 1995.[8] In the said Resolution, the Board justified its assumption of jurisdiction over GrandAir's application.

"WHEREAS, the CAB is specifically authorized under Section 10-C (1) of Republic Act No. 776 as follows:

'(c) The Board shall have the following specific powers and duties:

(1) In accordance with the provision of Chapter IV of this Act, to issue, deny, amend revise, alter, modify, cancel, suspend or revoke, in
whole or in part, upon petitioner-complaint, or upon its own initiative, any temporary operating permit or Certificate of Public
Convenience and Necessity; Provided, however; that in the case of foreign air carriers, the permit shall be issued with the approval of
the President of the Republic of the Philippines."

WHEREAS, such authority was affirmed in PAL vs. CAB, (23 SCRA 992), wherein the Supreme Court held that the CAB can even on its
own initiative, grant a TOP even before the presentation of evidence;

WHEREAS, more recently, Avia Filipinas vs. CAB, (CA-GR No. 23365), promulgated on October 30, 1991, held that in accordance with
its mandate, the CAB can issue not only a TOP but also a Certificate of Public Convenience and Necessity (CPCN) to a qualified
applicant therefor in the absence of a legislative franchise, citing therein as basis the decision of Albano vs. Reyes (175 SCRA 264)
which provides (inter alia) that:

a) Franchises by Congress are not required before each and every public utility may operate when the law has granted certain
administrative agencies the power to grant licenses for or to authorize the operation of certain public utilities;

b) The Constitutional provision in Article XII, Section 11 that the issuance of a franchise, certificate or other form of authorization for the
operation of a public utility does not necessarily imply that only Congress has the power to grant such authorization since our statute
books are replete with laws granting specified agencies in the Executive Branch the power to issue such authorization for certain
classes of public utilities.

WHEREAS, Executive Order No. 219 which took effect on 22 January 1995, provides in Section 2.1 that a minimum of two (2) operators
in each route/link shall be encouraged and that routes/links presently serviced by only one (1) operator shall be open for entry to
additional operators.

RESOLVED, (T)HEREFORE, that the Motion for Reconsideration filed by Philippine Airlines on January 05, 1995 on the Grant by this
Board of a Temporary Operating Permit (TOP) to Grand International Airways, Inc. alleging among others that the CAB has no such
jurisdiction, is hereby DENIED, as it hereby denied, in view of the foregoing and considering that the grounds relied upon by the movant
are not indubitable."

On March 21, 1995, upon motion by private respondent, the temporary permit was extended for a period of six (6) months or up to
September 22, 1995.
Hence this petition, filed on April 3, 1995.
Petitioners argue that the respondent Board acted beyond its powers and jurisdiction in taking cognizance of GrandAirs application
for the issuance of a Certificate of Public Convenience and Necessity, and in issuing a temporary operating permit in the meantime,
since GrandAir has not been granted and does not possess a legislative franchise to engage in scheduled domestic air transportation. A
legislative franchise is necessary before anyone may engage in air transport services, and a franchise may only be granted by
Congress. This is the meaning given by the petitioner upon a reading of Section 11, Article XII,[9] and Section 1, Article VI,[10] of the
Constitution.
To support its theory, PAL submits Opinion No. 163, S. 1989 of the Department of Justice, which reads:
Dr. Arturo C. Corona
Executive Director
Civil Aeronautics Board
PPL Building, 1000 U.N. Avenue
Ermita, Manila
Sir:

This has reference to your request for opinion on the necessity of a legislative franchise before the Civil Aeronautics Board (CAB) may
issue a Certificate of Public Convenience and Necessity and/or permit to engage in air commerce or air transportation to an individual or
entity.

You state that during the hearing on the application of Cebu Air for a congressional franchise, the House Committee on Corporations
and Franchises contended that under the present Constitution, the CAB may not issue the abovestated certificate or permit, unless the
individual or entity concerned possesses a legislative franchise. You believe otherwise, however, for the reason that under R.A. No. 776,
as amended, the CAB is explicitly empowered to issue operating permits or certificates of public convenience and necessity and that this
statutory provision is not inconsistent with the current charter.

We concur with the view expressed by the House Committee on Corporations and Franchises. In an opinion rendered in favor of your
predecessor-in-office, this Department observed that,-

xxx it is useful to note the distinction between the franchise to operate and a permit to commence operation. The
former is sovereign and legislative in nature; it can be conferred only by the lawmaking authority (17 W and P, pp.
691-697). The latter is administrative and regulatory in character (In re Application of Fort Crook-Bellevue
Boulevard Line, 283 NW 223); it is granted by an administrative agency, such as the Public Service Commission
[now Board of Transportation], in the case of land transportation, and the Civil Aeronautics Board, in case of air
services. While a legislative franchise is a pre-requisite to a grant of a certificate of public convenience and
necessity to an airline company, such franchise alone cannot constitute the authority to commence operations,
inasmuch as there are still matters relevant to such operations which are not determined in the franchise, like
rates, schedules and routes, and which matters are resolved in the process of issuance of permit by the
administrative. (Secretary of Justice opn No. 45, s. 1981)

Indeed, authorities are agreed that a certificate of public convenience and necessity is an authorization issued by the appropriate
governmental agency for the operation of public services for which a franchise is required by law (Almario, Transportation and Public
Service Law, 1977 Ed., p. 293; Agbayani, Commercial Law of the Phil., Vol. 4, 1979 Ed., pp. 380-381).

Based on the foregoing, it is clear that a franchise is the legislative authorization to engage in a business activity or enterprise of a public
nature, whereas a certificate of public convenience and necessity is a regulatory measure which constitutes the franchises authority to
commence operations. It is thus logical that the grant of the former should precede the latter.

Please be guided accordingly.

(SGD.) SEDFREY A. ORDOEZ

Secretary of Justice"

Respondent GrandAir, on the other hand, relies on its interpretation of the provisions of Republic Act 776, which follows the
pronouncements of the Court of Appeals in the cases of Avia Filipinas vs. Civil Aeronautics Board, and Silangan Airways, Inc. vs. Grand
International Airways (supra).
In both cases, the issue resolved was whether or not the Civil Aeronautics Board can issue the Certificate of Public Convenience
and Necessity or Temporary Operating Permit to a prospective domestic air transport operator who does not possess a legislative
franchise to operate as such. Relying on the Court's pronouncement in Albano vs. Reyes (supra), the Court of Appeals upheld the
authority of the Board to issue such authority, even in the absence of a legislative franchise, which authority is derived from Section 10
of Republic Act 776, as amended by P.D. 1462.[11]
The Civil Aeronautics Board has jurisdiction over GrandAir's Application for a Temporary Operating Permit. This rule has been
established in the case of Philippine Air Lines Inc., vs. Civil Aeronautics Board, promulgated on June 13, 1968. [12] The Board is expressly
authorized by Republic Act 776 to issue a temporary operating permit or Certificate of Public Convenience and Necessity, and nothing
contained in the said law negates the power to issue said permit before the completion of the applicant's evidence and that of the
oppositor thereto on the main petition. Indeed, the CAB's authority to grant a temporary permit "upon its own initiative" strongly suggests
the power to exercise said authority, even before the presentation of said evidence has begun. Assuming arguendo that a legislative
franchise is prerequisite to the issuance of a permit, the absence of the same does not affect the jurisdiction of the Board to hear the
application, but tolls only upon the ultimate issuance of the requested permit.
The power to authorize and control the operation of a public utility is admittedly a prerogative of the legislature, since Congress is
that branch of government vested with plenary powers of legislation.

"The franchise is a legislative grant, whether made directly by the legislature itself, or by any one of its properly constituted
instrumentalities. The grant, when made, binds the public, and is, directly or indirectly, the act of the state."[13]

The issue in this petition is whether or not Congress, in enacting Republic Act 776, has delegated the authority to authorize the
operation of domestic air transport services to the respondent Board, such that Congressional mandate for the approval of such
authority is no longer necessary.
Congress has granted certain administrative agencies the power to grant licenses for, or to authorize the operation of certain public
utilities. With the growing complexity of modern life, the multiplication of the subjects of governmental regulation, and the increased
difficulty of administering the laws, there is a constantly growing tendency towards the delegation of greater powers by the legislature,
and towards the approval of the practice by the courts. [14] It is generally recognized that a franchise may be derived indirectly from the
state through a duly designated agency, and to this extent, the power to grant franchises has frequently been delegated, even to
agencies other than those of a legislative nature.[15] In pursuance of this, it has been held that privileges conferred by grant by local
authorities as agents for the state constitute as much a legislative franchise as though the grant had been made by an act of the
Legislature.[16]
The trend of modern legislation is to vest the Public Service Commissioner with the power to regulate and control the operation of
public services under reasonable rules and regulations, and as a general rule, courts will not interfere with the exercise of that discretion
when it is just and reasonable and founded upon a legal right.[17]
It is this policy which was pursued by the Court in Albano vs. Reyes. Thus, a reading of the pertinent issuances governing the
Philippine Ports Authority,[18] proves that the PPA is empowered to undertake by itself the operation and management of the Manila
International Container Terminal, or to authorize its operation and management by another by contract or other means, at its option. The
latter power having been delegated to the PPA, a franchise from Congress to authorize an entity other than the PPA to operate and
manage the MICP becomes unnecessary.
Given the foregoing postulates, we find that the Civil Aeronautics Board has the authority to issue a Certificate of Public
Convenience and Necessity, or Temporary Operating Permit to a domestic air transport operator, who, though not possessing a
legislative franchise, meets all the other requirements prescribed by the law. Such requirements were enumerated in Section 21 of R.A.
776.
There is nothing in the law nor in the Constitution, which indicates that a legislative franchise is an indispensable requirement for
an entity to operate as a domestic air transport operator. Although Section 11 of Article XII recognizes Congress' control over any
franchise, certificate or authority to operate a public utility, it does not mean Congress has exclusive authority to issue the same.
Franchises issued by Congress are not required before each and every public utility may operate. [19] In many instances, Congress has
seen it fit to delegate this function to government agencies, specialized particularly in their respective areas of public service.
A reading of Section 10 of the same reveals the clear intent of Congress to delegate the authority to regulate the issuance of a
license to operate domestic air transport services:

SECTION 10. Powers and Duties of the Board. (A) Except as otherwise provided herein, the Board shall have the power to regulate the
economic aspect of air transportation, and shall have general supervision and regulation of, the jurisdiction and control over air carriers,
general sales agents, cargo sales agents, and air freight forwarders as well as their property rights, equipment, facilities and franchise,
insofar as may be necessary for the purpose of carrying out the provision of this Act.

In support of the Board's authority as stated above, it is given the following specific powers and duties:

(C) The Board shall have the following specific powers and duties:

(1) In accordance with the provisions of Chapter IV of this Act, to issue, deny, amend, revise, alter, modify, cancel, suspend or revoke in
whole or in part upon petition or complaint or upon its own initiative any Temporary Operating Permit or Certificate of Public
Convenience and Necessity: Provided however, That in the case of foreign air carriers, the permit shall be issued with the approval of
the President of the Republic of the Philippines.

Petitioner argues that since R.A. 776 gives the Board the authority to issue "Certificates of Public Convenience and Necessity",
this, according to petitioner, means that a legislative franchise is an absolute requirement. It cites a number of authorities supporting the
view that a Certificate of Public Convenience and Necessity is issued to a public service for which a franchise is required by law, as
distinguished from a "Certificate of Public Convenience" which is an authorization issued for the operation of public services for which no
franchise, either municipal or legislative, is required by law.[20]
This submission relies on the premise that the authority to issue a certificate of public convenience and necessity is a regulatory
measure separate and distinct from the authority to grant a franchise for the operation of the public utility subject of this particular case,
which is exclusively lodged by petitioner in Congress.
We do not agree with the petitioner.
Many and varied are the definitions of certificates of public convenience which courts and legal writers have drafted. Some statutes
use the terms "convenience and necessity" while others use only the words "public convenience." The terms "convenience and
necessity", if used together in a statute, are usually held not to be separable, but are construed together. Both words modify each other
and must be construed together. The word 'necessity' is so connected, not as an additional requirement but to modify and qualify what
might otherwise be taken as the strict significance of the word necessity. Public convenience and necessity exists when the proposed
facility will meet a reasonable want of the public and supply a need which the existing facilities do not adequately afford. It does not
mean or require an actual physical necessity or an indispensable thing.[21]

"The terms 'convenience' and 'necessity' are to be construed together, although they are not synonymous, and effect must be given
both. The convenience of the public must not be circumscribed by according to the word 'necessity' its strict meaning or an essential
requisites."[22]

The use of the word "necessity", in conjunction with "public convenience" in a certificate of authorization to a public service entity to
operate, does not in any way modify the nature of such certification, or the requirements for the issuance of the same. It is the law which
determines the requisites for the issuance of such certification, and not the title indicating the certificate.
Congress, by giving the respondent Board the power to issue permits for the operation of domestic transport services, has
delegated to the said body the authority to determine the capability and competence of a prospective domestic air transport operator to
engage in such venture. This is not an instance of transforming the respondent Board into a mini-legislative body, with unbridled
authority to choose who should be given authority to operate domestic air transport services.

"To be valid, the delegation itself must be circumscribed by legislative restrictions, not a "roving commission" that will give the delegate
unlimited legislative authority. It must not be a delegation "running riot" and "not canalized with banks that keep it from overflowing."
Otherwise, the delegation is in legal effect an abdication of legislative authority, a total surrender by the legislature of its prerogatives in
favor of the delegate."[23]

Congress, in this instance, has set specific limitations on how such authority should be exercised.
Firstly, Section 4 of R.A. No. 776, as amended, sets out the following guidelines or policies:

"SECTION 4. Declaration of policies. In the exercise and performance of its powers and duties under this Act, the Civil Aeronautics
Board and the Civil Aeronautics Administrator shall consider the following, among other things, as being in the public interest, and in
accordance with the public convenience and necessity:
(a) The development and utilization of the air potential of the Philippines;

(b) The encouragement and development of an air transportation system properly adapted to the present and future of foreign and
domestic commerce of the Philippines, of the Postal Service and of the National Defense;

(c) The regulation of air transportation in such manner as to recognize and preserve the inherent advantages of, assure the highest
degree of safety in, and foster sound economic condition in, such transportation, and to improve the relations between, and coordinate
transportation by, air carriers;

(d) The promotion of adequate, economical and efficient service by air carriers at reasonable charges, without unjust discriminations,
undue preferences or advantages, or unfair or destructive competitive practices;

(e) Competition between air carriers to the extent necessary to assure the sound development of an air transportation system properly
adapted to the need of the foreign and domestic commerce of the Philippines, of the Postal Service, and of the National Defense;

(f) To promote safety of flight in air commerce in the Philippines; and,

(g) The encouragement and development of civil aeronautics.

More importantly, the said law has enumerated the requirements to determine the competency of a prospective operator to engage
in the public service of air transportation.

SECTION 12. Citizenship requirement. Except as otherwise provided in the Constitution and existing treaty or treaties, a permit
authorizing a person to engage in domestic air commerce and/or air transportation shall be issued only to citizens of the Philippines.[24]

SECTION 21. Issuance of permit. The Board shall issue a permit authorizing the whole or any part of the service covered by the
application, if it finds: (1) that the applicant is fit, willing and able to perform such service properly in conformity with the provisions of this
Act and the rules, regulations, and requirements issued thereunder; and (2) that such service is required by the public convenience and
necessity; otherwise the application shall be denied.

Furthermore, the procedure for the processing of the application of a Certificate of Public Convenience and Necessity had been
established to ensure the weeding out of those entities that are not deserving of public service.[25]
In sum, respondent Board should now be allowed to continue hearing the application of GrandAir for the issuance of a Certificate
of Public Convenience and Necessity, there being no legal obstacle to the exercise of its jurisdiction.
ACCORDINGLY, in view of the foregoing considerations, the Court RESOLVED to DISMISS the instant petition for lack of merit.
The respondent Civil Aeronautics Board is hereby DIRECTED to CONTINUE hearing the application of respondent Grand International
Airways, Inc. for the issuance of a Certificate of Public Convenience and Necessity.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 17122 February 27, 1922

THE UNITED STATES, plaintiff-appellee,

vs.
ANG TANG HO, defendant-appellant.

Williams & Ferrier for appellant.

Acting Attorney-General Tuason for appellee.

JOHNS, J.:

At its special session of 1919, the Philippine Legislature passed Act No. 2868, entitled "An Act penalizing the monopoly and holding of,
and speculation in, palay, rice, and corn under extraordinary circumstances, regulating the distribution and sale thereof, and authorizing
the Governor-General, with the consent of the Council of State, to issue the necessary rules and regulations therefor, and making an
appropriation for this purpose," the material provisions of which are as follows:

Section 1. The Governor-General is hereby authorized, whenever, for any cause, conditions arise resulting in an extraordinary
rise in the price of palay, rice or corn, to issue and promulgate, with the consent of the Council of State, temporary rules and
emergency measures for carrying out the purpose of this Act, to wit:

(a) To prevent the monopoly and hoarding of, and speculation in, palay, rice or corn.

(b) To establish and maintain a government control of the distribution or sale of the commodities referred to or have such
distribution or sale made by the Government itself.

(c) To fix, from time to time the quantities of palay rice, or corn that a company or individual may acquire, and the maximum
sale price that the industrial or merchant may demand.

(d) . . .

SEC. 2. It shall be unlawful to destroy, limit, prevent or in any other manner obstruct the production or milling of palay, rice or
corn for the purpose of raising the prices thereof; to corner or hoard said products as defined in section three of this Act; . . .

Section 3 defines what shall constitute a monopoly or hoarding of palay, rice or corn within the meaning of this Act, but does not specify
the price of rice or define any basic for fixing the price.

SEC. 4. The violations of any of the provisions of this Act or of the regulations, orders and decrees promulgated in accordance
therewith shall be punished by a fine of not more than five thousands pesos, or by imprisonment for not more than two years,
or both, in the discretion of the court: Provided, That in the case of companies or corporations the manager or administrator
shall be criminally liable.

SEC. 7. At any time that the Governor-General, with the consent of the Council of State, shall consider that the public interest
requires the application of the provisions of this Act, he shall so declare by proclamation, and any provisions of other laws
inconsistent herewith shall from then on be temporarily suspended.

Upon the cessation of the reasons for which such proclamation was issued, the Governor-General, with the consent of the
Council of State, shall declare the application of this Act to have likewise terminated, and all laws temporarily suspended by
virtue of the same shall again take effect, but such termination shall not prevent the prosecution of any proceedings or cause
begun prior to such termination, nor the filing of any proceedings for an offense committed during the period covered by the
Governor-General's proclamation.

August 1, 1919, the Governor-General issued a proclamation fixing the price at which rice should be sold.

August 8, 1919, a complaint was filed against the defendant, Ang Tang Ho, charging him with the sale of rice at an excessive price as
follows:

The undersigned accuses Ang Tang Ho of a violation of Executive Order No. 53 of the Governor-General of the Philippines,
dated the 1st of August, 1919, in relation with the provisions of sections 1, 2 and 4 of Act No. 2868, committed as follows:

That on or about the 6th day of August, 1919, in the city of Manila, Philippine Islands, the said Ang Tang Ho, voluntarily, illegally
and criminally sold to Pedro Trinidad, one ganta of rice at the price of eighty centavos (P.80), which is a price greater than that
fixed by Executive Order No. 53 of the Governor-General of the Philippines, dated the 1st of August, 1919, under the authority
of section 1 of Act No. 2868. Contrary to law.
Upon this charge, he was tried, found guilty and sentenced to five months' imprisonment and to pay a fine of P500, from which he
appealed to this court, claiming that the lower court erred in finding Executive Order No. 53 of 1919, to be of any force and effect, in
finding the accused guilty of the offense charged, and in imposing the sentence.

The official records show that the Act was to take effect on its approval; that it was approved July 30, 1919; that the Governor-General
issued his proclamation on the 1st of August, 1919; and that the law was first published on the 13th of August, 1919; and that the
proclamation itself was first published on the 20th of August, 1919.

The question here involves an analysis and construction of Act No. 2868, in so far as it authorizes the Governor-General to fix the price
at which rice should be sold. It will be noted that section 1 authorizes the Governor-General, with the consent of the Council of State, for
any cause resulting in an extraordinary rise in the price of palay, rice or corn, to issue and promulgate temporary rules and emergency
measures for carrying out the purposes of the Act. By its very terms, the promulgation of temporary rules and emergency measures is
left to the discretion of the Governor-General. The Legislature does not undertake to specify or define under what conditions or for what
reasons the Governor-General shall issue the proclamation, but says that it may be issued "for any cause," and leaves the question as
to what is "any cause" to the discretion of the Governor-General. The Act also says: "For any cause, conditions arise resulting in an
extraordinary rise in the price of palay, rice or corn." The Legislature does not specify or define what is "an extraordinary rise." That is
also left to the discretion of the Governor-General. The Act also says that the Governor-General, "with the consent of the Council of
State," is authorized to issue and promulgate "temporary rules and emergency measures for carrying out the purposes of this Act." It
does not specify or define what is a temporary rule or an emergency measure, or how long such temporary rules or emergency
measures shall remain in force and effect, or when they shall take effect. That is to say, the Legislature itself has not in any manner
specified or defined any basis for the order, but has left it to the sole judgement and discretion of the Governor-General to say what is or
what is not "a cause," and what is or what is not "an extraordinary rise in the price of rice," and as to what is a temporary rule or an
emergency measure for the carrying out the purposes of the Act. Under this state of facts, if the law is valid and the Governor-General
issues a proclamation fixing the minimum price at which rice should be sold, any dealer who, with or without notice, sells rice at a higher
price, is a criminal. There may not have been any cause, and the price may not have been extraordinary, and there may not have been
an emergency, but, if the Governor-General found the existence of such facts and issued a proclamation, and rice is sold at any higher
price, the seller commits a crime.

By the organic law of the Philippine Islands and the Constitution of the United States all powers are vested in the Legislative, Executive
and Judiciary. It is the duty of the Legislature to make the law; of the Executive to execute the law; and of the Judiciary to construe the
law. The Legislature has no authority to execute or construe the law, the Executive has no authority to make or construe the law, and the
Judiciary has no power to make or execute the law. Subject to the Constitution only, the power of each branch is supreme within its own
jurisdiction, and it is for the Judiciary only to say when any Act of the Legislature is or is not constitutional. Assuming, without deciding,
that the Legislature itself has the power to fix the price at which rice is to be sold, can it delegate that power to another, and, if so, was
that power legally delegated by Act No. 2868? In other words, does the Act delegate legislative power to the Governor-General? By the
Organic Law, all Legislative power is vested in the Legislature, and the power conferred upon the Legislature to make laws cannot be
delegated to the Governor-General, or any one else. The Legislature cannot delegate the legislative power to enact any law. If Act no
2868 is a law unto itself and within itself, and it does nothing more than to authorize the Governor-General to make rules and regulations
to carry the law into effect, then the Legislature itself created the law. There is no delegation of power and it is valid. On the other hand, if
the Act within itself does not define crime, and is not a law, and some legislative act remains to be done to make it a law or a crime, the
doing of which is vested in the Governor-General, then the Act is a delegation of legislative power, is unconstitutional and void.

The Supreme Court of the United States in what is known as the Granger Cases (94 U.S., 183-187; 24 L. ed., 94), first laid down the
rule:

Railroad companies are engaged in a public employment affecting the public interest and, under the decision in
Munn vs. Ill., ante, 77, are subject to legislative control as to their rates of fare and freight unless protected by their charters.

The Illinois statute of Mar. 23, 1874, to establish reasonable maximum rates of charges for the transportation of freights and
passengers on the different railroads of the State is not void as being repugnant to the Constitution of the United States or to
that of the State.

It was there for the first time held in substance that a railroad was a public utility, and that, being a public utility, the State had power to
establish reasonable maximum freight and passenger rates. This was followed by the State of Minnesota in enacting a similar law,
providing for, and empowering, a railroad commission to hear and determine what was a just and reasonable rate. The constitutionality
of this law was attacked and upheld by the Supreme Court of Minnesota in a learned and exhaustive opinion by Justice Mitchell, in the
case of State vs. Chicago, Milwaukee & St. Paul ry. Co. (38 Minn., 281), in which the court held:

Regulations of railway tariffs — Conclusiveness of commission's tariffs. — Under Laws 1887, c. 10, sec. 8, the determination of
the railroad and warehouse commission as to what are equal and reasonable fares and rates for the transportation of persons
and property by a railway company is conclusive, and, in proceedings by mandamus to compel compliance with the tariff of
rates recommended and published by them, no issue can be raised or inquiry had on that question.

Same — constitution — Delegation of power to commission. — The authority thus given to the commission to determine, in the
exercise of their discretion and judgement, what are equal and reasonable rates, is not a delegation of legislative power.

It will be noted that the law creating the railroad commission expressly provides —

That all charges by any common carrier for the transportation of passengers and property shall be equal and reasonable.

With that as a basis for the law, power is then given to the railroad commission to investigate all the facts, to hear and determine what is
a just and reasonable rate. Even then that law does not make the violation of the order of the commission a crime. The only remedy is a
civil proceeding. It was there held —
 That the legislative itself has the power to regulate railroad charges is now too well settled to require either argument or citation
of authority.

The difference between the power to say what the law shall be, and the power to adopt rules and regulations, or to investigate
and determine the facts, in order to carry into effect a law already passed, is apparent. The true distinction is between the
delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and the conferring an
authority or discretion to be exercised under and in pursuance of the law.

The legislature enacts that all freights rates and passenger fares should be just and reasonable. It had the undoubted power to
fix these rates at whatever it deemed equal and reasonable.

They have not delegated to the commission any authority or discretion as to what the law shall be, — which would not be
allowable, — but have merely conferred upon it an authority and discretion, to be exercised in the execution of the law, and
under and in pursuance of it, which is entirely permissible. The legislature itself has passed upon the expediency of the law,
and what is shall be. The commission is intrusted with no authority or discretion upon these questions. It can neither make nor
unmake a single provision of law. It is merely charged with the administration of the law, and with no other power.

The delegation of legislative power was before the Supreme Court of Wisconsin in Dowling vs. Lancoshire Ins. Co. (92 Wis., 63). The
opinion says:

"The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to what it
shall be, and conferring authority or discretion as to its execution, to be exercised under and in pursuance of the law. The first
cannot be done; to the latter no valid objection can be made."

The act, in our judgment, wholly fails to provide definitely and clearly what the standard policy should contain, so that it could be put in
use as a uniform policy required to take the place of all others, without the determination of the insurance commissioner in respect to
maters involving the exercise of a legislative discretion that could not be delegated, and without which the act could not possibly be put
in use as an act in confirmity to which all fire insurance policies were required to be issued.

The result of all the cases on this subject is that a law must be complete, in all its terms and provisions, when it leaves the legislative
branch of the government, and nothing must be left to the judgement of the electors or other appointee or delegate of the legislature, so
that, in form and substance, it is a law in all its details in presenti, but which may be left to take effect in futuro, if necessary, upon the
ascertainment of any prescribed fact or event.

The delegation of legislative power was before the Supreme Court in United States vs. Grimaud (220 U.S., 506; 55 L. ed., 563), where it
was held that the rules and regulations of the Secretary of Agriculture as to a trespass on government land in a forest reserve were valid
constitutional. The Act there provided that the Secretary of Agriculture ". . . may make such rules and regulations and establish such
service as will insure the object of such reservations; namely, to regulate their occupancy and use, and to preserve the forests thereon
from destruction; and any violation of the provisions of this act or such rules and regulations shall be punished, . . ."

The brief of the United States Solicitor-General says:

In refusing permits to use a forest reservation for stock grazing, except upon stated terms or in stated ways, the Secretary of
Agriculture merely assert and enforces the proprietary right of the United States over land which it owns. The regulation of the
Secretary, therefore, is not an exercise of legislative, or even of administrative, power; but is an ordinary and legitimate refusal
of the landowner's authorized agent to allow person having no right in the land to use it as they will. The right of proprietary
control is altogether different from governmental authority.

The opinion says:

From the beginning of the government, various acts have been passed conferring upon executive officers power to make rules
and regulations, — not for the government of their departments, but for administering the laws which did govern. None of these
statutes could confer legislative power. But when Congress had legislated power. But when Congress had legislated and
indicated its will, it could give to those who were to act under such general provisions "power to fill up the details" by the
establishment of administrative rules and regulations, the violation of which could be punished by fine or imprisonment fixed by
Congress, or by penalties fixed by Congress, or measured by the injury done.

That "Congress cannot delegate legislative power is a principle universally recognized as vital to the integrity and maintenance
of the system of government ordained by the Constitution."

If, after the passage of the act and the promulgation of the rule, the defendants drove and grazed their sheep upon the reserve,
in violation of the regulations, they were making an unlawful use of the government's property. In doing so they thereby made
themselves liable to the penalty imposed by Congress.

The subjects as to which the Secretary can regulate are defined. The lands are set apart as a forest reserve. He is required to make
provisions to protect them from depredations and from harmful uses. He is authorized 'to regulate the occupancy and use and to
preserve the forests from destruction.' A violation of reasonable rules regulating the use and occupancy of the property is made a crime,
not by the Secretary, but by Congress."

The above are leading cases in the United States on the question of delegating legislative power. It will be noted that in the "Granger
Cases," it was held that a railroad company was a public corporation, and that a railroad was a public utility, and that, for such reasons,
the legislature had the power to fix and determine just and reasonable rates for freight and passengers.
The Minnesota case held that, so long as the rates were just and reasonable, the legislature could delegate the power to ascertain the
facts and determine from the facts what were just and reasonable rates,. and that in vesting the commission with such power was not a
delegation of legislative power.

The Wisconsin case was a civil action founded upon a "Wisconsin standard policy of fire insurance," and the court held that "the act, . . .
wholly fails to provide definitely and clearly what the standard policy should contain, so that it could be put in use as a uniform policy
required to take the place of all others, without the determination of the insurance commissioner in respect to matters involving the
exercise of a legislative discretion that could not be delegated."

The case of the United States Supreme Court, supra dealt with rules and regulations which were promulgated by the Secretary of
Agriculture for Government land in the forest reserve.

These decisions hold that the legislative only can enact a law, and that it cannot delegate it legislative authority.

The line of cleavage between what is and what is not a delegation of legislative power is pointed out and clearly defined. As the
Supreme Court of Wisconsin says:

That no part of the legislative power can be delegated by the legislature to any other department of the government, executive
or judicial, is a fundamental principle in constitutional law, essential to the integrity and maintenance of the system of
government established by the constitution.

Where an act is clothed with all the forms of law, and is complete in and of itself, it may be provided that it shall become
operative only upon some certain act or event, or, in like manner, that its operation shall be suspended.

The legislature cannot delegate its power to make a law, but it can make a law to delegate a power to determine some fact or
state of things upon which the law makes, or intends to make, its own action to depend.

The Village of Little Chute enacted an ordinance which provides:

All saloons in said village shall be closed at 11 o'clock P.M. each day and remain closed until 5 o'clock on the following
morning, unless by special permission of the president.

Construing it in 136 Wis., 526; 128 A. S. R., 1100,1 the Supreme Court of that State says:

We regard the ordinance as void for two reasons; First, because it attempts to confer arbitrary power upon an executive officer,
and allows him, in executing the ordinance, to make unjust and groundless discriminations among persons similarly situated;
second, because the power to regulate saloons is a law-making power vested in the village board, which cannot be delegated.
A legislative body cannot delegate to a mere administrative officer power to make a law, but it can make a law with provisions
that it shall go into effect or be suspended in its operations upon the ascertainment of a fact or state of facts by an
administrative officer or board. In the present case the ordinance by its terms gives power to the president to decide arbitrary,
and in the exercise of his own discretion, when a saloon shall close. This is an attempt to vest legislative discretion in him, and
cannot be sustained.

The legal principle involved there is squarely in point here.

It must be conceded that, after the passage of act No. 2868, and before any rules and regulations were promulgated by the Governor-
General, a dealer in rice could sell it at any price, even at a peso per "ganta," and that he would not commit a crime, because there
would be no law fixing the price of rice, and the sale of it at any price would not be a crime. That is to say, in the absence of a
proclamation, it was not a crime to sell rice at any price. Hence, it must follow that, if the defendant committed a crime, it was because
the Governor-General issued the proclamation. There was no act of the Legislature making it a crime to sell rice at any price, and
without the proclamation, the sale of it at any price was to a crime.

The Executive order2 provides:

(5) The maximum selling price of palay, rice or corn is hereby fixed, for the time being as follows:

In Manila —

Palay at P6.75 per sack of 57½ kilos, or 29 centavos per ganta.

Rice at P15 per sack of 57½ kilos, or 63 centavos per ganta.

Corn at P8 per sack of 57½ kilos, or 34 centavos per ganta.

In the provinces producing palay, rice and corn, the maximum price shall be the Manila price less the cost of transportation
from the source of supply and necessary handling expenses to the place of sale, to be determined by the provincial treasurers
or their deputies.

In provinces, obtaining their supplies from Manila or other producing provinces, the maximum price shall be the authorized
price at the place of supply or the Manila price as the case may be, plus the transportation cost, from the place of supply and
the necessary handling expenses, to the place of sale, to be determined by the provincial treasurers or their deputies.
 (6) Provincial treasurers and their deputies are hereby directed to communicate with, and execute all instructions emanating
from the Director of Commerce and Industry, for the most effective and proper enforcement of the above regulations in their
respective localities.

The law says that the Governor-General may fix "the maximum sale price that the industrial or merchant may demand." The law is a
general law and not a local or special law.

The proclamation undertakes to fix one price for rice in Manila and other and different prices in other and different provinces in the
Philippine Islands, and delegates the power to determine the other and different prices to provincial treasurers and their deputies. Here,
then, you would have a delegation of legislative power to the Governor-General, and a delegation by him of that power to provincial
treasurers and their deputies, who "are hereby directed to communicate with, and execute all instructions emanating from the Director of
Commerce and Industry, for the most effective and proper enforcement of the above regulations in their respective localities." The
issuance of the proclamation by the Governor-General was the exercise of the delegation of a delegated power, and was even a sub
delegation of that power.

Assuming that it is valid, Act No. 2868 is a general law and does not authorize the Governor-General to fix one price of rice in Manila
and another price in Iloilo. It only purports to authorize him to fix the price of rice in the Philippine Islands under a law, which is General
and uniform, and not local or special. Under the terms of the law, the price of rice fixed in the proclamation must be the same all over the
Islands. There cannot be one price at Manila and another at Iloilo. Again, it is a mater of common knowledge, and of which this court will
take judicial notice, that there are many kinds of rice with different and corresponding market values, and that there is a wide range in
the price, which varies with the grade and quality. Act No. 2868 makes no distinction in price for the grade or quality of the rice, and the
proclamation, upon which the defendant was tried and convicted, fixes the selling price of rice in Manila "at P15 per sack of 57½ kilos, or
63 centavos per ganta," and is uniform as to all grades of rice, and says nothing about grade or quality. Again, it will be noted that the
law is confined to palay, rice and corn. They are products of the Philippine Islands. Hemp, tobacco, coconut, chickens, eggs, and many
other things are also products. Any law which single out palay, rice or corn from the numerous other products of the Islands is not
general or uniform, but is a local or special law. If such a law is valid, then by the same principle, the Governor-General could be
authorized by proclamation to fix the price of meat, eggs, chickens, coconut, hemp, and tobacco, or any other product of the Islands. In
the very nature of things, all of that class of laws should be general and uniform. Otherwise, there would be an unjust discrimination of
property rights, which, under the law, must be equal and inform. Act No. 2868 is nothing more than a floating law, which, in the discretion
and by a proclamation of the Governor-General, makes it a floating crime to sell rice at a price in excess of the proclamation, without
regard to grade or quality.

When Act No. 2868 is analyzed, it is the violation of the proclamation of the Governor-General which constitutes the crime. Without that
proclamation, it was no crime to sell rice at any price. In other words, the Legislature left it to the sole discretion of the Governor-General
to say what was and what was not "any cause" for enforcing the act, and what was and what was not "an extraordinary rise in the price
of palay, rice or corn," and under certain undefined conditions to fix the price at which rice should be sold, without regard to grade or
quality, also to say whether a proclamation should be issued, if so, when, and whether or not the law should be enforced, how long it
should be enforced, and when the law should be suspended. The Legislature did not specify or define what was "any cause," or what
was "an extraordinary rise in the price of rice, palay or corn," Neither did it specify or define the conditions upon which the proclamation
should be issued. In the absence of the proclamation no crime was committed. The alleged sale was made a crime, if at all, because the
Governor-General issued the proclamation. The act or proclamation does not say anything about the different grades or qualities of rice,
and the defendant is charged with the sale "of one ganta of rice at the price of eighty centavos (P0.80) which is a price greater than that
fixed by Executive order No. 53."

We are clearly of the opinion and hold that Act No. 2868, in so far as it undertakes to authorized the Governor-General in his discretion
to issue a proclamation, fixing the price of rice, and to make the sale of rice in violation of the price of rice, and to make the sale of rice in
violation of the proclamation a crime, is unconstitutional and void.

It may be urged that there was an extraordinary rise in the price of rice and profiteering, which worked a severe hardship on the poorer
classes, and that an emergency existed, but the question here presented is the constitutionality of a particular portion of a statute, and
none of such matters is an argument for, or against, its constitutionality.

The Constitution is something solid, permanent an substantial. Its stability protects the life, liberty and property rights of the rich and the
poor alike, and that protection ought not to change with the wind or any emergency condition. The fundamental question involved in this
case is the right of the people of the Philippine Islands to be and live under a republican form of government. We make the broad
statement that no state or nation, living under republican form of government, under the terms and conditions specified in Act No. 2868,
has ever enacted a law delegating the power to any one, to fix the price at which rice should be sold. That power can never be
delegated under a republican form of government.

In the fixing of the price at which the defendant should sell his rice, the law was not dealing with government property. It was dealing with
private property and private rights, which are sacred under the Constitution. If this law should be sustained, upon the same principle and
for the same reason, the Legislature could authorize the Governor-General to fix the price of every product or commodity in the
Philippine Islands, and empower him to make it a crime to sell any product at any other or different price.

It may be said that this was a war measure, and that for such reason the provision of the Constitution should be suspended. But the
Stubborn fact remains that at all times the judicial power was in full force and effect, and that while that power was in force and effect,
such a provision of the Constitution could not be, and was not, suspended even in times of war. It may be claimed that during the war,
the United States Government undertook to, and did, fix the price at which wheat and flour should be bought and sold, and that is true.
There, the United States had declared war, and at the time was at war with other nations, and it was a war measure, but it is also true
that in doing so, and as a part of the same act, the United States commandeered all the wheat and flour, and took possession of it,
either actual or constructive, and the government itself became the owner of the wheat and flour, and fixed the price to be paid for it.
That is not this case. Here the rice sold was the personal and private property of the defendant, who sold it to one of his customers. The
government had not bought and did not claim to own the rice, or have any interest in it, and at the time of the alleged sale, it was the
personal, private property of the defendant. It may be that the law was passed in the interest of the public, but the members of this court
have taken on solemn oath to uphold and defend the Constitution, and it ought not to be construed to meet the changing winds or
emergency conditions. Again, we say that no state or nation under a republican form of government ever enacted a law authorizing any
executive, under the conditions states, to fix the price at which a price person would sell his own rice, and make the broad statement
that no decision of any court, on principle or by analogy, will ever be found which sustains the constitutionality of the particular portion of
Act No. 2868 here in question. By the terms of the Organic Act, subject only to constitutional limitations, the power to legislate and enact
laws is vested exclusively in the Legislative, which is elected by a direct vote of the people of the Philippine Islands. As to the question
here involved, the authority of the Governor-General to fix the maximum price at which palay, rice and corn may be sold in the manner
power in violation of the organic law.

This opinion is confined to the particular question here involved, which is the right of the Governor-General, upon the terms and
conditions stated in the Act, to fix the price of rice and make it a crime to sell it at a higher price, and which holds that portions of the Act
unconstitutional. It does not decide or undertake to construe the constitutionality of any of the remaining portions of the Act.

The judgment of the lower court is reversed, and the defendant discharged. So ordered.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 74457 March 20, 1987

RESTITUTO YNOT, petitioner,

vs.
INTERMEDIATE APPELLATE COURT, THE STATION COMMANDER, INTEGRATED NATIONAL POLICE, BAROTAC NUEVO,
ILOILO and THE REGIONAL DIRECTOR, BUREAU OF ANIMAL INDUSTRY, REGION IV, ILOILO CITY, respondents.

Ramon A. Gonzales for petitioner.

CRUZ, J.:

The essence of due process is distilled in the immortal cry of Themistocles to Alcibiades "Strike — but hear me first!" It is this cry that the
petitioner in effect repeats here as he challenges the constitutionality of Executive Order No. 626-A.

The said executive order reads in full as follows:

WHEREAS, the President has given orders prohibiting the interprovincial movement of carabaos and the slaughtering
of carabaos not complying with the requirements of Executive Order No. 626 particularly with respect to age;

WHEREAS, it has been observed that despite such orders the violators still manage to circumvent the prohibition
against inter-provincial movement of carabaos by transporting carabeef instead; and

WHEREAS, in order to achieve the purposes and objectives of Executive Order No. 626 and the prohibition against
interprovincial movement of carabaos, it is necessary to strengthen the said Executive Order and provide for the
disposition of the carabaos and carabeef subject of the violation;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me
by the Constitution, do hereby promulgate the following:

SECTION 1. Executive Order No. 626 is hereby amended such that henceforth, no carabao regardless of age, sex,
physical condition or purpose and no carabeef shall be transported from one province to another. The carabao or
carabeef transported in violation of this Executive Order as amended shall be subject to confiscation and forfeiture by
the government, to be distributed to charitable institutions and other similar institutions as the Chairman of the
National Meat Inspection Commission may ay see fit, in the case of carabeef, and to deserving farmers through
dispersal as the Director of Animal Industry may see fit, in the case of carabaos.

SECTION 2. This Executive Order shall take effect immediately.

Done in the City of Manila, this 25th day of October, in the year of Our Lord, nineteen hundred and eighty.

(SGD.) FERDINAND E. MARCOS

President

Republic of the Philippines

The petitioner had transported six carabaos in a pump boat from Masbate to Iloilo on January 13, 1984, when they were confiscated by
the police station commander of Barotac Nuevo, Iloilo, for violation of the above measure. 1 The petitioner sued for recovery, and the
Regional Trial Court of Iloilo City issued a writ of replevin upon his filing of a supersedeas bond of P12,000.00. After considering the
merits of the case, the court sustained the confiscation of the carabaos and, since they could no longer be produced, ordered the
confiscation of the bond. The court also declined to rule on the constitutionality of the executive order, as raise by the petitioner, for lack
of authority and also for its presumed validity. 2

The petitioner appealed the decision to the Intermediate Appellate Court,* 3 which upheld the trial court, ** and he has now come before
us in this petition for review on certiorari.

The thrust of his petition is that the executive order is unconstitutional insofar as it authorizes outright confiscation of the carabao or
carabeef being transported across provincial boundaries. His claim is that the penalty is invalid because it is imposed without according
the owner a right to be heard before a competent and impartial court as guaranteed by due process. He complains that the measure
should not have been presumed, and so sustained, as constitutional. There is also a challenge to the improper exercise of the legislative
power by the former President under Amendment No. 6 of the 1973 Constitution. 4
While also involving the same executive order, the case of Pesigan v. Angeles 5 is not applicable here. The question raised there was
the necessity of the previous publication of the measure in the Official Gazette before it could be considered enforceable. We imposed
the requirement then on the basis of due process of law. In doing so, however, this Court did not, as contended by the Solicitor General,
impliedly affirm the constitutionality of Executive Order No. 626-A. That is an entirely different matter.

This Court has declared that while lower courts should observe a becoming modesty in examining constitutional questions, they are
nonetheless not prevented from resolving the same whenever warranted, subject only to review by the highest tribunal. 6 We have
jurisdiction under the Constitution to "review, revise, reverse, modify or affirm on appeal or certiorari, as the law or rules of court may
provide," final judgments and orders of lower courts in, among others, all cases involving the constitutionality of certain measures. 7 This
simply means that the resolution of such cases may be made in the first instance by these lower courts.

And while it is true that laws are presumed to be constitutional, that presumption is not by any means conclusive and in fact may be
rebutted. Indeed, if there be a clear showing of their invalidity, and of the need to declare them so, then "will be the time to make the
hammer fall, and heavily," 8 to recall Justice Laurel's trenchant warning. Stated otherwise, courts should not follow the path of least
resistance by simply presuming the constitutionality of a law when it is questioned. On the contrary, they should probe the issue more
deeply, to relieve the abscess, paraphrasing another distinguished jurist, 9 and so heal the wound or excise the affliction.

Judicial power authorizes this; and when the exercise is demanded, there should be no shirking of the task for fear of retaliation, or loss
of favor, or popular censure, or any other similar inhibition unworthy of the bench, especially this Court.

The challenged measure is denominated an executive order but it is really presidential decree, promulgating a new rule instead of
merely implementing an existing law. It was issued by President Marcos not for the purpose of taking care that the laws were faithfully
executed but in the exercise of his legislative authority under Amendment No. 6. It was provided thereunder that whenever in his
judgment there existed a grave emergency or a threat or imminence thereof or whenever the legislature failed or was unable to act
adequately on any matter that in his judgment required immediate action, he could, in order to meet the exigency, issue decrees, orders
or letters of instruction that were to have the force and effect of law. As there is no showing of any exigency to justify the exercise of that
extraordinary power then, the petitioner has reason, indeed, to question the validity of the executive order. Nevertheless, since the
determination of the grounds was supposed to have been made by the President "in his judgment, " a phrase that will lead to protracted
discussion not really necessary at this time, we reserve resolution of this matter until a more appropriate occasion. For the nonce, we
confine ourselves to the more fundamental question of due process.

It is part of the art of constitution-making that the provisions of the charter be cast in precise and unmistakable language to avoid
controversies that might arise on their correct interpretation. That is the Ideal. In the case of the due process clause, however, this rule
was deliberately not followed and the wording was purposely kept ambiguous. In fact, a proposal to delineate it more clearly was
submitted in the Constitutional Convention of 1934, but it was rejected by Delegate Jose P. Laurel, Chairman of the Committee on the
Bill of Rights, who forcefully argued against it. He was sustained by the body. 10

The due process clause was kept intentionally vague so it would remain also conveniently resilient. This was felt necessary because
due process is not, like some provisions of the fundamental law, an "iron rule" laying down an implacable and immutable command for
all seasons and all persons. Flexibility must be the best virtue of the guaranty. The very elasticity of the due process clause was meant
to make it adapt easily to every situation, enlarging or constricting its protection as the changing times and circumstances may require.

Aware of this, the courts have also hesitated to adopt their own specific description of due process lest they confine themselves in a
legal straitjacket that will deprive them of the elbow room they may need to vary the meaning of the clause whenever indicated. Instead,
they have preferred to leave the import of the protection open-ended, as it were, to be "gradually ascertained by the process of inclusion
and exclusion in the course of the decision of cases as they arise." 11 Thus, Justice Felix Frankfurter of the U.S. Supreme Court, for
example, would go no farther than to define due process — and in so doing sums it all up — as nothing more and nothing less than "the
embodiment of the sporting Idea of fair play." 12

When the barons of England extracted from their sovereign liege the reluctant promise that that Crown would thenceforth not proceed
against the life liberty or property of any of its subjects except by the lawful judgment of his peers or the law of the land, they thereby
won for themselves and their progeny that splendid guaranty of fairness that is now the hallmark of the free society. The solemn vow that
King John made at Runnymede in 1215 has since then resounded through the ages, as a ringing reminder to all rulers, benevolent or
base, that every person, when confronted by the stern visage of the law, is entitled to have his say in a fair and open hearing of his
cause.

The closed mind has no place in the open society. It is part of the sporting Idea of fair play to hear "the other side" before an opinion is
formed or a decision is made by those who sit in judgment. Obviously, one side is only one-half of the question; the other half must also
be considered if an impartial verdict is to be reached based on an informed appreciation of the issues in contention. It is indispensable
that the two sides complement each other, as unto the bow the arrow, in leading to the correct ruling after examination of the problem
not from one or the other perspective only but in its totality. A judgment based on less that this full appraisal, on the pretext that a hearing
is unnecessary or useless, is tainted with the vice of bias or intolerance or ignorance, or worst of all, in repressive regimes, the insolence
of power.

The minimum requirements of due process are notice and hearing 13 which, generally speaking, may not be dispensed with because
they are intended as a safeguard against official arbitrariness. It is a gratifying commentary on our judicial system that the jurisprudence
of this country is rich with applications of this guaranty as proof of our fealty to the rule of law and the ancient rudiments of fair play. We
have consistently declared that every person, faced by the awesome power of the State, is entitled to "the law of the land," which Daniel
Webster described almost two hundred years ago in the famous Dartmouth College Case, 14 as "the law which hears before it
condemns, which proceeds upon inquiry and renders judgment only after trial." It has to be so if the rights of every person are to be
secured beyond the reach of officials who, out of mistaken zeal or plain arrogance, would degrade the due process clause into a worn
and empty catchword.
This is not to say that notice and hearing are imperative in every case for, to be sure, there are a number of admitted exceptions. The
conclusive presumption, for example, bars the admission of contrary evidence as long as such presumption is based on human
experience or there is a rational connection between the fact proved and the fact ultimately presumed therefrom. 15 There are instances
when the need for expeditions action will justify omission of these requisites, as in the summary abatement of a nuisance per se, like a
mad dog on the loose, which may be killed on sight because of the immediate danger it poses to the safety and lives of the people.
Pornographic materials, contaminated meat and narcotic drugs are inherently pernicious and may be summarily destroyed. The
passport of a person sought for a criminal offense may be cancelled without hearing, to compel his return to the country he has
fled. 16 Filthy restaurants may be summarily padlocked in the interest of the public health and bawdy houses to protect the public
morals. 17 In such instances, previous judicial hearing may be omitted without violation of due process in view of the nature of the
property involved or the urgency of the need to protect the general welfare from a clear and present danger.

The protection of the general welfare is the particular function of the police power which both restraints and is restrained by due process.
The police power is simply defined as the power inherent in the State to regulate liberty and property for the promotion of the general
welfare. 18 By reason of its function, it extends to all the great public needs and is described as the most pervasive, the least limitable
and the most demanding of the three inherent powers of the State, far outpacing taxation and eminent domain. The individual, as a
member of society, is hemmed in by the police power, which affects him even before he is born and follows him still after he is dead —
from the womb to beyond the tomb — in practically everything he does or owns. Its reach is virtually limitless. It is a ubiquitous and often
unwelcome intrusion. Even so, as long as the activity or the property has some relevance to the public welfare, its regulation under the
police power is not only proper but necessary. And the justification is found in the venerable Latin maxims, Salus populi est suprema
lex and Sic utere tuo ut alienum non laedas, which call for the subordination of individual interests to the benefit of the greater number.

It is this power that is now invoked by the government to justify Executive Order No. 626-A, amending the basic rule in Executive Order
No. 626, prohibiting the slaughter of carabaos except under certain conditions. The original measure was issued for the reason, as
expressed in one of its Whereases, that "present conditions demand that the carabaos and the buffaloes be conserved for the benefit of
the small farmers who rely on them for energy needs." We affirm at the outset the need for such a measure. In the face of the worsening
energy crisis and the increased dependence of our farms on these traditional beasts of burden, the government would have been
remiss, indeed, if it had not taken steps to protect and preserve them.

A similar prohibition was challenged in United States v. Toribio, 19 where a law regulating the registration, branding and slaughter of
large cattle was claimed to be a deprivation of property without due process of law. The defendant had been convicted thereunder for
having slaughtered his own carabao without the required permit, and he appealed to the Supreme Court. The conviction was affirmed.
The law was sustained as a valid police measure to prevent the indiscriminate killing of carabaos, which were then badly needed by
farmers. An epidemic had stricken many of these animals and the reduction of their number had resulted in an acute decline in
agricultural output, which in turn had caused an incipient famine. Furthermore, because of the scarcity of the animals and the
consequent increase in their price, cattle-rustling had spread alarmingly, necessitating more effective measures for the registration and
branding of these animals. The Court held that the questioned statute was a valid exercise of the police power and declared in part as
follows:

To justify the State in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the
public generally, as distinguished from those of a particular class, require such interference; and second, that the
means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon
individuals. ...

From what has been said, we think it is clear that the enactment of the provisions of the statute under consideration
was required by "the interests of the public generally, as distinguished from those of a particular class" and that the
prohibition of the slaughter of carabaos for human consumption, so long as these animals are fit for agricultural work
or draft purposes was a "reasonably necessary" limitation on private ownership, to protect the community from the
loss of the services of such animals by their slaughter by improvident owners, tempted either by greed of momentary
gain, or by a desire to enjoy the luxury of animal food, even when by so doing the productive power of the community
may be measurably and dangerously affected.

In the light of the tests mentioned above, we hold with the Toribio Case that the carabao, as the poor man's tractor, so to speak, has a
direct relevance to the public welfare and so is a lawful subject of Executive Order No. 626. The method chosen in the basic measure is
also reasonably necessary for the purpose sought to be achieved and not unduly oppressive upon individuals, again following the
above-cited doctrine. There is no doubt that by banning the slaughter of these animals except where they are at least seven years old if
male and eleven years old if female upon issuance of the necessary permit, the executive order will be conserving those still fit for farm
work or breeding and preventing their improvident depletion.

But while conceding that the amendatory measure has the same lawful subject as the original executive order, we cannot say with equal
certainty that it complies with the second requirement, viz., that there be a lawful method. We note that to strengthen the original
measure, Executive Order No. 626-A imposes an absolute ban not on the slaughter of the carabaos but on their movement, providing
that "no carabao regardless of age, sex, physical condition or purpose (sic) and no carabeef shall be transported from one province to
another." The object of the prohibition escapes us. The reasonable connection between the means employed and the purpose sought to
be achieved by the questioned measure is missing

We do not see how the prohibition of the inter-provincial transport of carabaos can prevent their indiscriminate slaughter, considering
that they can be killed anywhere, with no less difficulty in one province than in another. Obviously, retaining the carabaos in one province
will not prevent their slaughter there, any more than moving them to another province will make it easier to kill them there. As for the
carabeef, the prohibition is made to apply to it as otherwise, so says executive order, it could be easily circumvented by simply killing the
animal. Perhaps so. However, if the movement of the live animals for the purpose of preventing their slaughter cannot be prohibited, it
should follow that there is no reason either to prohibit their transfer as, not to be flippant dead meat.

Even if a reasonable relation between the means and the end were to be assumed, we would still have to reckon with the sanction that
the measure applies for violation of the prohibition. The penalty is outright confiscation of the carabao or carabeef being transported, to
be meted out by the executive authorities, usually the police only. In the Toribio Case, the statute was sustained because the penalty
prescribed was fine and imprisonment, to be imposed by the court after trial and conviction of the accused. Under the challenged
measure, significantly, no such trial is prescribed, and the property being transported is immediately impounded by the police and
declared, by the measure itself, as forfeited to the government.

In the instant case, the carabaos were arbitrarily confiscated by the police station commander, were returned to the petitioner only after
he had filed a complaint for recovery and given a supersedeas bond of P12,000.00, which was ordered confiscated upon his failure to
produce the carabaos when ordered by the trial court. The executive order defined the prohibition, convicted the petitioner and
immediately imposed punishment, which was carried out forthright. The measure struck at once and pounced upon the petitioner without
giving him a chance to be heard, thus denying him the centuries-old guaranty of elementary fair play.

It has already been remarked that there are occasions when notice and hearing may be validly dispensed with notwithstanding the usual
requirement for these minimum guarantees of due process. It is also conceded that summary action may be validly taken in
administrative proceedings as procedural due process is not necessarily judicial only. 20 In the exceptional cases accepted, however.
there is a justification for the omission of the right to a previous hearing, to wit, the immediacy of the problem sought to be corrected and
the urgency of the need to correct it.

In the case before us, there was no such pressure of time or action calling for the petitioner's peremptory treatment. The properties
involved were not even inimical per se as to require their instant destruction. There certainly was no reason why the offense prohibited
by the executive order should not have been proved first in a court of justice, with the accused being accorded all the rights safeguarded
to him under the Constitution. Considering that, as we held in Pesigan v. Angeles, 21 Executive Order No. 626-A is penal in nature, the
violation thereof should have been pronounced not by the police only but by a court of justice, which alone would have had the authority
to impose the prescribed penalty, and only after trial and conviction of the accused.

We also mark, on top of all this, the questionable manner of the disposition of the confiscated property as prescribed in the questioned
executive order. It is there authorized that the seized property shall "be distributed to charitable institutions and other similar institutions
as the Chairman of the National Meat Inspection Commission may see fit, in the case of carabeef, and to deserving farmers through
dispersal as the Director of Animal Industry may see fit, in the case of carabaos." (Emphasis supplied.) The phrase "may see fit" is an
extremely generous and dangerous condition, if condition it is. It is laden with perilous opportunities for partiality and abuse, and even
corruption. One searches in vain for the usual standard and the reasonable guidelines, or better still, the limitations that the said officers
must observe when they make their distribution. There is none. Their options are apparently boundless. Who shall be the fortunate
beneficiaries of their generosity and by what criteria shall they be chosen? Only the officers named can supply the answer, they and they
alone may choose the grantee as they see fit, and in their own exclusive discretion. Definitely, there is here a "roving commission," a
wide and sweeping authority that is not "canalized within banks that keep it from overflowing," in short, a clearly profligate and therefore
invalid delegation of legislative powers.

To sum up then, we find that the challenged measure is an invalid exercise of the police power because the method employed to
conserve the carabaos is not reasonably necessary to the purpose of the law and, worse, is unduly oppressive. Due process is violated
because the owner of the property confiscated is denied the right to be heard in his defense and is immediately condemned and
punished. The conferment on the administrative authorities of the power to adjudge the guilt of the supposed offender is a clear
encroachment on judicial functions and militates against the doctrine of separation of powers. There is, finally, also an invalid delegation
of legislative powers to the officers mentioned therein who are granted unlimited discretion in the distribution of the properties arbitrarily
taken. For these reasons, we hereby declare Executive Order No. 626-A unconstitutional.

We agree with the respondent court, however, that the police station commander who confiscated the petitioner's carabaos is not liable
in damages for enforcing the executive order in accordance with its mandate. The law was at that time presumptively valid, and it was
his obligation, as a member of the police, to enforce it. It would have been impertinent of him, being a mere subordinate of the President,
to declare the executive order unconstitutional and, on his own responsibility alone, refuse to execute it. Even the trial court, in fact, and
the Court of Appeals itself did not feel they had the competence, for all their superior authority, to question the order we now annul.

The Court notes that if the petitioner had not seen fit to assert and protect his rights as he saw them, this case would never have
reached us and the taking of his property under the challenged measure would have become a fait accompli despite its invalidity. We
commend him for his spirit. Without the present challenge, the matter would have ended in that pump boat in Masbate and another
violation of the Constitution, for all its obviousness, would have been perpetrated, allowed without protest, and soon forgotten in the
limbo of relinquished rights.

The strength of democracy lies not in the rights it guarantees but in the courage of the people to invoke them whenever they are ignored
or violated. Rights are but weapons on the wall if, like expensive tapestry, all they do is embellish and impress. Rights, as weapons,
must be a promise of protection. They become truly meaningful, and fulfill the role assigned to them in the free society, if they are kept
bright and sharp with use by those who are not afraid to assert them.

WHEREFORE, Executive Order No. 626-A is hereby declared unconstitutional. Except as affirmed above, the decision of the Court of
Appeals is reversed. The supersedeas bond is cancelled and the amount thereof is ordered restored to the petitioner. No costs.

SO ORDERED.

\
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-23825 December 24, 1965

EMMANUEL PELAEZ, petitioner,

vs.
THE AUDITOR GENERAL, respondent.

Zulueta, Gonzales, Paculdo and Associates for petitioner.

Office of the Solicitor General for respondent.

CONCEPCION, J.:

During the period from September 4 to October 29, 1964 the President of the Philippines, purporting to act pursuant to Section 68 of the
Revised Administrative Code, issued Executive Orders Nos. 93 to 121, 124 and 126 to 129; creating thirty-three (33) municipalities
enumerated in the margin.1 Soon after the date last mentioned, or on November 10, 1964 petitioner Emmanuel Pelaez, as Vice
President of the Philippines and as taxpayer, instituted the present special civil action, for a writ of prohibition with preliminary injunction,
against the Auditor General, to restrain him, as well as his representatives and agents, from passing in audit any expenditure of public
funds in implementation of said executive orders and/or any disbursement by said municipalities.

Petitioner alleges that said executive orders are null and void, upon the ground that said Section 68 has been impliedly repealed by
Republic Act No. 2370 and constitutes an undue delegation of legislative power. Respondent maintains the contrary view and avers that
the present action is premature and that not all proper parties — referring to the officials of the new political subdivisions in question —
have been impleaded. Subsequently, the mayors of several municipalities adversely affected by the aforementioned executive orders —
because the latter have taken away from the former the barrios composing the new political subdivisions — intervened in the case.
Moreover, Attorneys Enrique M. Fernando and Emma Quisumbing-Fernando were allowed to and did appear as amici curiae.

The third paragraph of Section 3 of Republic Act No. 2370, reads:

Barrios shall not be created or their boundaries altered nor their names changed except under the provisions of this Act or by
Act of Congress.

Pursuant to the first two (2) paragraphs of the same Section 3:

All barrios existing at the time of the passage of this Act shall come under the provisions hereof.

Upon petition of a majority of the voters in the areas affected, a new barrio may be created or the name of an existing one may
be changed by the provincial board of the province, upon recommendation of the council of the municipality or municipalities in
which the proposed barrio is stipulated. The recommendation of the municipal council shall be embodied in a resolution
approved by at least two-thirds of the entire membership of the said council: Provided, however, That no new barrio may be
created if its population is less than five hundred persons.

Hence, since January 1, 1960, when Republic Act No. 2370 became effective, barrios may "not be created or their boundaries altered
nor their names changed" except by Act of Congress or of the corresponding provincial board "upon petition of a majority of the voters in
the areas affected" and the "recommendation of the council of the municipality or municipalities in which the proposed barrio is situated."
Petitioner argues, accordingly: "If the President, under this new law, cannot even create a barrio, can he create a municipality which is
composed of several barrios, since barrios are units of municipalities?"

Respondent answers in the affirmative, upon the theory that a new municipality can be created without creating new barrios, such as, by
placing old barrios under the jurisdiction of the new municipality. This theory overlooks, however, the main import of the petitioner's
argument, which is that the statutory denial of the presidential authority to create a new barrio implies a negation of the bigger power to
create municipalities, each of which consists of several barrios. The cogency and force of this argument is too obvious to be denied or
even questioned. Founded upon logic and experience, it cannot be offset except by a clear manifestation of the intent of Congress to the
contrary, and no such manifestation, subsequent to the passage of Republic Act No. 2379, has been brought to our attention.

Moreover, section 68 of the Revised Administrative Code, upon which the disputed executive orders are based, provides:

The (Governor-General) President of the Philippines may by executive order define the boundary, or boundaries, of any
province, subprovince, municipality, [township] municipal district, or other political subdivision, and increase or diminish the
territory comprised therein, may divide any province into one or more subprovinces, separate any political division other than a
province, into such portions as may be required, merge any of such subdivisions or portions with another, name any new
subdivision so created, and may change the seat of government within any subdivision to such place therein as the public
welfare may require: Provided, That the authorization of the (Philippine Legislature) Congress of the Philippines shall first be
obtained whenever the boundary of any province or subprovince is to be defined or any province is to be divided into one or
more subprovinces. When action by the (Governor-General) President of the Philippines in accordance herewith makes
necessary a change of the territory under the jurisdiction of any administrative officer or any judicial officer, the (Governor-
 General) President of the Philippines, with the recommendation and advice of the head of the Department having executive
control of such officer, shall redistrict the territory of the several officers affected and assign such officers to the new districts so
formed.

Upon the changing of the limits of political divisions in pursuance of the foregoing authority, an equitable distribution of the
funds and obligations of the divisions thereby affected shall be made in such manner as may be recommended by the (Insular
Auditor) Auditor General and approved by the (Governor-General) President of the Philippines.

Respondent alleges that the power of the President to create municipalities under this section does not amount to an undue delegation
of legislative power, relying upon Municipality of Cardona vs. Municipality of Binañgonan (36 Phil. 547), which, he claims, has settled it.
Such claim is untenable, for said case involved, not the creation of a new municipality, but a mere transfer of territory — from an already
existing municipality (Cardona) to another municipality (Binañgonan), likewise, existing at the time of and prior to said transfer (See
Gov't of the P.I. ex rel. Municipality of Cardona vs. Municipality, of Binañgonan [34 Phil. 518, 519-5201) — in consequence of the fixing
and definition, pursuant to Act No. 1748, of the common boundaries of two municipalities.

It is obvious, however, that, whereas the power to fix such common boundary, in order to avoid or settle conflicts of jurisdiction between
adjoining municipalities, may partake of an administrative nature — involving, as it does, the adoption of means and ways to carry into
effect the law creating said municipalities — the authority to create municipal corporations is essentially legislative in nature. In the
language of other courts, it is "strictly a legislative function" (State ex rel. Higgins vs. Aicklen, 119 S. 425, January 2, 1959) or "solely
and exclusively the exercise of legislative power" (Udall vs. Severn, May 29, 1938, 79 P. 2d 347-349). As the Supreme Court of
Washington has put it (Territory ex rel. Kelly vs. Stewart, February 13, 1890, 23 Pac. 405, 409), "municipal corporations are purely the
creatures of statutes."

Although1a Congress may delegate to another branch of the Government the power to fill in the details in the execution, enforcement or
administration of a law, it is essential, to forestall a violation of the principle of separation of powers, that said law: (a) be complete in
itself — it must set forth therein the policy to be executed, carried out or implemented by the delegate2 — and (b) fix a standard — the
limits of which are sufficiently determinate or determinable — to which the delegate must conform in the performance of his
functions.2aIndeed, without a statutory declaration of policy, the delegate would in effect, make or formulate such policy, which is the
essence of every law; and, without the aforementioned standard, there would be no means to determine, with reasonable certainty,
whether the delegate has acted within or beyond the scope of his authority.2b Hence, he could thereby arrogate upon himself the power,
not only to make the law, but, also — and this is worse — to unmake it, by adopting measures inconsistent with the end sought to be
attained by the Act of Congress, thus nullifying the principle of separation of powers and the system of checks and balances, and,
consequently, undermining the very foundation of our Republican system.

Section 68 of the Revised Administrative Code does not meet these well settled requirements for a valid delegation of the power to fix
the details in the enforcement of a law. It does not enunciate any policy to be carried out or implemented by the President. Neither does
it give a standard sufficiently precise to avoid the evil effects above referred to. In this connection, we do not overlook the fact that, under
the last clause of the first sentence of Section 68, the President:

... may change the seat of the government within any subdivision to such place therein as the public welfare may require.

It is apparent, however, from the language of this clause, that the phrase "as the public welfare may require" qualified, not the clauses
preceding the one just quoted, but only the place to which the seat of the government may be transferred. This fact becomes more
apparent when we consider that said Section 68 was originally Section 1 of Act No. 1748,3 which provided that, "whenever in the
judgment of the Governor-General the public welfare requires, he may, by executive order," effect the changes enumerated therein (as
in said section 68), including the change of the seat of the government "to such place ... as the public interest requires." The opening
statement of said Section 1 of Act No. 1748 — which was not included in Section 68 of the Revised Administrative Code — governed the
time at which, or the conditions under which, the powers therein conferred could be exercised; whereas the last part of the first sentence
of said section referred exclusively to the place to which the seat of the government was to be transferred.

At any rate, the conclusion would be the same, insofar as the case at bar is concerned, even if we assumed that the phrase "as the
public welfare may require," in said Section 68, qualifies all other clauses thereof. It is true that in Calalang vs. Williams (70 Phil. 726)
and People vs. Rosenthal (68 Phil. 328), this Court had upheld "public welfare" and "public interest," respectively, as sufficient standards
for a valid delegation of the authority to execute the law. But, the doctrine laid down in these cases — as all judicial pronouncements —
must be construed in relation to the specific facts and issues involved therein, outside of which they do not constitute precedents and
have no binding effect.4 The law construed in the Calalang case conferred upon the Director of Public Works, with the approval of the
Secretary of Public Works and Communications, the power to issue rules and regulations to promote safe transit upon national
roads and streets. Upon the other hand, the Rosenthal case referred to the authority of the Insular Treasurer, under Act No. 2581, to
issue and cancel certificates or permits for the sale of speculative securities. Both cases involved grants to administrative officers of
powers related to the exercise of their administrative functions, calling for the determination of questions of fact.

Such is not the nature of the powers dealt with in section 68. As above indicated, the creation of municipalities, is not
an administrative function, but one which is essentially and eminently legislative in character. The question of whether or not "public
interest" demands the exercise of such power is not one of fact. it is "purely a legislative question "(Carolina-Virginia Coastal Highway
vs. Coastal Turnpike Authority, 74 S.E. 2d. 310-313, 315-318), or a political question (Udall vs. Severn, 79 P. 2d. 347-349). As the
Supreme Court of Wisconsin has aptly characterized it, "the question as to whether incorporation is for the best interest of the
community in any case is emphatically a question of public policy and statecraft" (In re Village of North Milwaukee, 67 N.W. 1033, 1035-
1037).

For this reason, courts of justice have annulled, as constituting undue delegation of legislative powers, state laws granting the judicial
department, the power to determine whether certain territories should be annexed to a particular municipality (Udall vs. Severn, supra,
258-359); or vesting in a Commission the right to determine the plan and frame of government of proposed villages and what functions
shall be exercised by the same, although the powers and functions of the village are specifically limited by statute (In re Municipal
Charters, 86 Atl. 307-308); or conferring upon courts the authority to declare a given town or village incorporated, and designate its
metes and bounds, upon petition of a majority of the taxable inhabitants thereof, setting forth the area desired to be included in such
village (Territory ex rel Kelly vs. Stewart, 23 Pac. 405-409); or authorizing the territory of a town, containing a given area and population,
to be incorporated as a town, on certain steps being taken by the inhabitants thereof and on certain determination by a court and
subsequent vote of the inhabitants in favor thereof, insofar as the court is allowed to determine whether the lands embraced in the
petition "ought justly" to be included in the village, and whether the interest of the inhabitants will be promoted by such incorporation,
and to enlarge and diminish the boundaries of the proposed village "as justice may require" (In re Villages of North Milwaukee, 67 N.W.
1035-1037); or creating a Municipal Board of Control which shall determine whether or not the laying out, construction or operation of a
toll road is in the "public interest" and whether the requirements of the law had been complied with, in which case the board shall enter
an order creating a municipal corporation and fixing the name of the same (Carolina-Virginia Coastal Highway vs. Coastal Turnpike
Authority, 74 S.E. 2d. 310).

Insofar as the validity of a delegation of power by Congress to the President is concerned, the case of Schechter Poultry Corporation vs.
U.S. (79 L. Ed. 1570) is quite relevant to the one at bar. The Schechter case involved the constitutionality of Section 3 of the National
Industrial Recovery Act authorizing the President of the United States to approve "codes of fair competition" submitted to him by one or
more trade or industrial associations or corporations which "impose no inequitable restrictions on admission to membership therein and
are truly representative," provided that such codes are not designed "to promote monopolies or to eliminate or oppress small enterprises
and will not operate to discriminate against them, and will tend to effectuate the policy" of said Act. The Federal Supreme Court held:

To summarize and conclude upon this point: Sec. 3 of the Recovery Act is without precedent. It supplies no standards for any
trade, industry or activity. It does not undertake to prescribe rules of conduct to be applied to particular states of fact determined
by appropriate administrative procedure. Instead of prescribing rules of conduct, it authorizes the making of codes to prescribe
them. For that legislative undertaking, Sec. 3 sets up no standards, aside from the statement of the general aims of
rehabilitation, correction and expansion described in Sec. 1. In view of the scope of that broad declaration, and of the nature of
the few restrictions that are imposed, the discretion of the President in approving or prescribing codes, and thus enacting laws
for the government of trade and industry throughout the country, is virtually unfettered. We think that the code making authority
thus conferred is an unconstitutional delegation of legislative power.

If the term "unfair competition" is so broad as to vest in the President a discretion that is "virtually unfettered." and, consequently,
tantamount to a delegation of legislative power, it is obvious that "public welfare," which has even a broader connotation, leads to the
same result. In fact, if the validity of the delegation of powers made in Section 68 were upheld, there would no longer be any legal
impediment to a statutory grant of authority to the President to do anything which, in his opinion, may be required by public welfare or
public interest. Such grant of authority would be a virtual abdication of the powers of Congress in favor of the Executive, and would bring
about a total collapse of the democratic system established by our Constitution, which it is the special duty and privilege of this Court to
uphold.

It may not be amiss to note that the executive orders in question were issued after the legislative bills for the creation of the
municipalities involved in this case had failed to pass Congress. A better proof of the fact that the issuance of said executive orders
entails the exercise of purely legislative functions can hardly be given.

Again, Section 10 (1) of Article VII of our fundamental law ordains:

The President shall have control of all the executive departments, bureaus, or offices, exercise general supervision over all
local governments as may be provided by law, and take care that the laws be faithfully executed.

The power of control under this provision implies the right of the President to interfere in the exercise of such discretion as may be
vested by law in the officers of the executive departments, bureaus, or offices of the national government, as well as to act in lieu of such
officers. This power is denied by the Constitution to the Executive, insofar as local governments are concerned. With respect to the
latter, the fundamental law permits him to wield no more authority than that of checking whether said local governments or the officers
thereof perform their duties as provided by statutory enactments. Hence, the President cannot interfere with local governments, so long
as the same or its officers act Within the scope of their authority. He may not enact an ordinance which the municipal council has failed
or refused to pass, even if it had thereby violated a duty imposed thereto by law, although he may see to it that the corresponding
provincial officials take appropriate disciplinary action therefor. Neither may he vote, set aside or annul an ordinance passed by said
council within the scope of its jurisdiction, no matter how patently unwise it may be. He may not even suspend an elective official of a
regular municipality or take any disciplinary action against him, except on appeal from a decision of the corresponding provincial board.5

Upon the other hand if the President could create a municipality, he could, in effect, remove any of its officials, by creating a new
municipality and including therein the barrio in which the official concerned resides, for his office would thereby become vacant.6 Thus,
by merely brandishing the power to create a new municipality (if he had it), without actually creating it, he could compel local officials to
submit to his dictation, thereby, in effect, exercising over them the power of control denied to him by the Constitution.

Then, also, the power of control of the President over executive departments, bureaus or offices implies no more than the authority to
assume directly the functions thereof or to interfere in the exercise of discretion by its officials. Manifestly, such control does not include
the authority either to abolish an executive department or bureau, or to create a new one. As a consequence, the alleged power of the
President to create municipal corporations would necessarily connote the exercise by him of an authority even greater than that of
control which he has over the executive departments, bureaus or offices. In other words, Section 68 of the Revised Administrative Code
does not merely fail to comply with the constitutional mandate above quoted. Instead of giving the President less power over local
governments than that vested in him over the executive departments, bureaus or offices, it reverses the process and does the exact
opposite, by conferring upon him more power over municipal corporations than that which he has over said executive departments,
bureaus or offices.

In short, even if it did entail an undue delegation of legislative powers, as it certainly does, said Section 68, as part of the Revised
Administrative Code, approved on March 10, 1917, must be deemed repealed by the subsequent adoption of the Constitution, in 1935,
which is utterly incompatible and inconsistent with said statutory enactment.7
There are only two (2) other points left for consideration, namely, respondent's claim (a) that "not all the proper parties" — referring to
the officers of the newly created municipalities — "have been impleaded in this case," and (b) that "the present petition is premature."

As regards the first point, suffice it to say that the records do not show, and the parties do not claim, that the officers of any of said
municipalities have been appointed or elected and assumed office. At any rate, the Solicitor General, who has appeared on behalf of
respondent Auditor General, is the officer authorized by law "to act and represent the Government of the Philippines, its offices and
agents, in any official investigation, proceeding or matter requiring the services of a lawyer" (Section 1661, Revised Administrative
Code), and, in connection with the creation of the aforementioned municipalities, which involves a political, not proprietary, function, said
local officials, if any, are mere agents or representatives of the national government. Their interest in the case at bar has, accordingly,
been, in effect, duly represented.8

With respect to the second point, respondent alleges that he has not as yet acted on any of the executive order & in question and has
not intimated how he would act in connection therewith. It is, however, a matter of common, public knowledge, subject to judicial
cognizance, that the President has, for many years, issued executive orders creating municipal corporations and that the same have
been organized and in actual operation, thus indicating, without peradventure of doubt, that the expenditures incidental thereto have
been sanctioned, approved or passed in audit by the General Auditing Office and its officials. There is no reason to believe, therefore,
that respondent would adopt a different policy as regards the new municipalities involved in this case, in the absence of an allegation to
such effect, and none has been made by him.

WHEREFORE, the Executive Orders in question are hereby declared null and void ab initio and the respondent permanently restrained
from passing in audit any expenditure of public funds in implementation of said Executive Orders or any disbursement by the
municipalities above referred to. It is so ordered.