DEVELOPMENT BANK OF THE PHILIPPINES vs.

COMMISSION ON AUDIT

FACTS:
In 1986, the Philippine government obtained from the World Bank an Economic Recovery Loan (ERL) in
the amount of US$310 million, which was intended to support the recovery of the Philippine economy
during that time of financial crisis. As a condition for granting the loan, the World Bank required the
Philippine government to rehabilitate the DBP which was then saddled with huge non-performing loans.
Accordingly, the government made a policy entitled Policy Statement for the Development Bank of the
Philippines which stated in part:" Furthermore, like all financial institutions under Central Bank
supervision, DBP will now be required to have a private external audit, and its Board of Directors will now
be opened to adequate private sector representation. It is hoped that with these commitments, DBP can
avoid the difficulties of the past and can function as a competitive and viable financial institution within
the Philippine financial system."Pursuant to said Policy, the Monetary Board adopted Resolution No. 1079
amending the Central Bank's Manual of Regulations for Banks and other Financial Intermediaries, in line
with the government's commitment to the World Bank to require a private external auditor for DBP.
Former COA Chairman Teofisto Guingona Jr. did not object said provisions and new regulations imposed.
So, DBP hired Joaquin Cunanan & Co. as its external auditor for calendar year 1986. However, during a
change of its leadership, the new COA Chairman, Eufemio Domingo, wrote the Central Bank Governor
protesting the Central Bank's issuance of said Circular No. 1124 which allegedly encroached upon the
COA's constitutional and statutory power to audit government agencies. Hence, he issued a Memorandum
disallowing payments to said auditing firm saying that the services rendered were unconstitutional, illegal
and unnecessary.

ISSUE:
Whether the Constitution vests in the COA the sole and exclusive power to examine and audit government
banks so as to prohibit concurrent audit by private external auditors under any circumstance.

RULING:
The DBP's petition is meritorious. The COA vigorously asserts that under the first paragraph of Section 2,
the COA enjoys the sole and exclusive power to examine and audit all government agencies, including the
DBP. The COA contends this is similar to its sole and exclusive authority, under the second paragraph... of
the same Section, to define the scope of its audit, promulgate auditing rules and regulations, including
rules on the disallowance of unnecessary expenditures of government agencies. The bare language of
Section 2, however, shows that the COA's power under the first paragraph... is not declared exclusive,
while its authority under the second paragraph is expressly declared "exclusive." There is a significant
reason for this marked difference in language. The mere fact that private auditors may audit government
agencies does not divest the COA of its power to examine and audit the same government agencies. The
COA is neither by-passed nor ignored since even with a private audit the COA will still conduct its usual...
examination and audit, and its findings and conclusions will still bind government agencies and their
officials. A concurrent private audit poses no danger whatsoever of public funds or assets escaping the
usual scrutiny of a COA audit. The inevitable conclusion is that the COA and the Central Bank have
concurrent jurisdiction, under the Constitution, to examine and audit government banks.
 EXPORT PROCESSING ZONE AUTHORITY vs. COMMISSION ON HUMAN RIGHTS

FACTS:
Valles, Aedia and Ordonez filed with CHR a joint complaint against EPZA for allegedly violating their human
rights when EPZA Project Engineer Damondamon along with 215th PNP Company tried to level the area
occupied by complainants. The same parcel of land was reserved and allocated for purpose of
development into Cavite Export Processing Zone which was bought by Filoil Refinery Corporation and was
later sold to EPZA. CHR issued an order of injunction for EPZA and company to desist from committing
further acts of demolition, terrorism and harassment until further order. 2 weeks later the group started
bulldozing the area and CHR reiterated its order of injunction, including the Secretary of Public Works and
Highways to desist from doing work on the area. EPZA filed a motion to life the order with CHR for lack of
authority and said motion was dismissed. EPZA filed the case at bar for certiorari and prohibition alleging
that CHR acted in excess of its jurisdiction in issuing a restraining order and injunctive writ; that the private
respondents have no clear and positive right to be protected by an injunction; and that CHR abused its
discretion in entertaining the complaint. EPZA’s petition was granted and a TRO was issued ordering CHR
to cease and desist from enforcing/implementing the injunction orders. CHR commented that its function
is not limited to mere investigation (Art. 13, Sec. 18 of the 1987 Constitution).

ISSUE:
Whether or not CHR has the jurisdiction to issue a writ of injunction or restraining order against supposed
violators of human rights, to compel them to cease and desist from continuing the acts complained of.

RULING:
In Carino vs CHR, it was held that CHR is not a court of justice nor even a quasi-judicial body. The most
that may be conceded to the Commission in the way of adjudicative power is that it may investigate, i.e.,
receive evidence and make findings of fact as regards claimed human rights violations involving civil and
political rights. But fact-finding is not adjudication, and cannot be likened to the judicial function of a court
of justice, or even a quasi-judicial agency or official. The function of receiving evidence and ascertaining
therefrom the facts of a controversy is not a judicial function, properly speaking. The constitutional
provision directing the CHR to "provide for preventive measures and legal aid services to the
underprivileged whose human rights have been violated or need protection" may not be construed to
confer jurisdiction on the Commission to issue a restraining order or writ of injunction for, if that were the
intention, the Constitution would have expressly said so. Jurisdiction is conferred by law and never derived
by implication. Evidently, the "preventive measures and legal aid services" mentioned in the Constitution
refer to extrajudicial and judicial remedies (including a preliminary writ of injunction) which the CHR may
seek from the proper courts on behalf of the victims of human rights violations. Not being a court of
justice, the CHR itself has no jurisdiction to issue the writ, for a writ of preliminary injunction may only be
issued "by the judge of any court in which the action is pending [within his district], or by a Justice of the
Court of Appeals, or of the Supreme Court.A writ of preliminary injunction is an ancillary remedy. It is
available only in a pending principal action, for the preservation or protection of the rights and interest of
a party thereto, and for no other purpose. EPZA’s petition is granted.
 GOVERNMENT SERVICE INSURANCE SYSTEM vs. CIVIL SERVICE COMMISSION

FACTS:
The GSIS dismissed six government employees on account of irregularities in the canvassing of supplies.
The employees appealed to the Merit Board. Said board found for the employees and declared the
dismissal as illegal because no hearing took place. The GSIS took the issue to the Civil Service which then
ruled that the dismissal was indeed illegal. The CSC thereafter ordered the reinstatement of the
employees and demanded the payment of backwages. The replacements of the dismissed employees
should then be released from service.The GSIS remained unconvinced and raised the issue to the SC. SC
affirmed the Civil Service ruling saying “The CSC acted within its authority o Reinstatement was proper”.
However, the SC modified the requirement of backpay. Said backpay should be made after the outcome
of the disciplinary proceedings. Heirs of the dismissed employees filed a motion for execution of the Civil
Service resolution so that backwages can be paid. GSIS however denied the motion saying that the SC
modified that part of the ruling. CSC nonetheless thumbed its nose to the GSIS and granted the motion.
GSIS was made to pay. Backed against the wall, GSIS filed certiorari with the SC asking that the CSC order
be nullified. The GSIS contends that the CSC has no power to execute its judgments.

ISSUE:
Whether the Civil Service has the power to enforce its judgments.

RULING:
Yes. The Civil Service Commission is a constitutional commission invested by the Constitution and relevant
laws not only with authority to administer the civil service, but also with quasi-judicial powers. It has the
authority to hear and decide administrative disciplinary cases instituted directly with it or brought to it on
appeal. It has the power, too, sitting en banc, to promulgate its own rules concerning pleadings and
practice before it or before any of its offices, which rules should not however diminish, increase, or modify
substantive rights. In light of all the foregoing constitutional and statutory provisions, it would appear
absurd to deny to the Civil Service Commission the power or authority or order execution of its decisions,
resolutions or orders. It would seem quite obvious that the authority to decide cases is inutile unless
accompanied by the authority to see that what has been decided is carried out. Hence, the grant to a
tribunal or agency of adjudicatory power, or the authority to hear and adjudge cases, should normally and
logically be deemed to include the grant of authority to enforce or execute the judgments it thus renders,
unless the law otherwise provides.
 BRILLANTES vs. YORAC

FACTS:
In December 1989, a coup attempt occurred prompting the president to create a fact finding commission
which would be chaired by Hilario Davide. Consequently he has to vacate his chairmanship of the
COMELEC. Yorac was temporarily placed as his substitute. Brillantes then questioned such appointment
urging that under Art 10-C of the Constitution “in no case shall any member of the COMELEC be appointed
or designated in a temporary or acting capacity”. Brillantes claimed that the choice of the acting chairman
should not be appointed for such is an internal matter that should be resolved by the members themselves
and that the intrusion of the president violates the independence of the COMELEC as a constitutional
commission.

ISSUE:
Whether or not the designation made by the president violates the constitutional independence of the
COMELEC.

RULING:
The Supreme Court ruled that although all constitutional commissions are essentially executive in nature,
they are not under the control of the president in the discharge of their functions. The designation made
by the president has dubious justification as it was merely grounded on the quote “administrative
expediency” to present the functions of the COMELEC. Aside from such justification, it found no basis on
existing rules on statutes. Yorac’s designation is null and unconstitutional.
 TATAD vs. DEPARTMENT OF ENERGY

FACTS:
The petitioner question the constitutionality of RA No. 8180 “An Act Deregulating the Downstream Oil
Industry and For Other Purposes.” The deregulation process has two phases: (a) the transition phase and
the (b) full deregulation phase through EO No. 372. The petitioner claims that Sec. 15 of RA No. 8180
constitutes an undue delegation of legislative power to the President and the Sec. of Energy because it
does not provide a determinate or determinable standard to guide the Executive Branch in determining
when to implement the full deregulation of the downstream oil industry, and the law does not provide
any specific standard to determine when the prices of crude oil in the world market are considered to be
declining nor when the exchange rate of the peso to the US dollar is considered stable.

ISSUE:
Whether or not Sec 15 of R.A. 8180 violates the constitutional prohibition on undue delegation of power.

RULING:
There are two accepted tests to determine whether or not there is a valid delegation of legislative power,
viz: the completeness test and the sufficient standard test. Under the first test, the law must be complete
in all its terms and conditions when it leaves the legislative such that when it reaches the delegate the
only thing he will have to do is to enforce it. Under the sufficient standard test, there must be adequate
guidelines or limitations in the law to map out the boundaries of the delegate’s authority and prevent the
delegation from running riot. Both tests are intended to prevent a total transference of legislative
authority to the delegate, who is not allowed to step into the shoes of the legislature and exercise a power
essentially legislative.
Sec 15 of R.A. 8180 can hurdle both the completeness test and the sufficient standard test. It will be noted
that Congress expressly provided in R.A. No. 8180 that full deregulation will start at the end of March
1997, regardless of the occurrence of any event. Full deregulation at the end of March 1997 is mandatory
and the Executive has no discretion to postpone it for any purported reason. Thus, the law is complete on
the question of the final date of full deregulation. The discretion given to the President is to advance the
date of full deregulation before the end of March 1997. Section 15 lays down the standard to guide the
judgment of the President. He is to time it as far as practicable when the prices of crude oil and petroleum
products in the world market are declining and when the exchange rate of the peso in relation to the US
dollar is stable.
 GUINGONA,JR. vs. COURT OF APPEALS

FACTS:
This case is an offshoot of the investigation conducted by the government in the last quarter of 1995,
which delved into the alleged participation of national and local officials in jueteng and other forms of
illegal gambling. Although the Court of Appeals upheld the admission into the Witness Protection Program
of Potenciano A. Roque, who claimed personal knowledge of such gambling activities, the secretary of
justice nonetheless challenges the side opinion of the appellate court that the testimony of the witness
must, as a condition precedent to his admission into said program, be shown to be capable of substantial
corroboration in its material points. The justice secretary claims that such corroboration need not be
demonstrated prior to or simultaneous with the witness admission into the program, as long as such
requirement can be demonstrated when he actually testifies in Court. However, inasmuch as Roque has
already been admitted into the Program and has actually finished testifying, the issue presented by
petitioners has become moot.

ISSUE:
Whether or not a witness testimony requires prior or simultaneous corroboration at the time he is
admitted into the witness protection security and benefit program.

RULING:
The Court finds the petition fundamentally defective. The Constitution provides that judicial power
“includes the duty of the courts of justice to settle actual controversies involving rights which are legally
demandable and enforceable.” Judicial review, which is merely an aspect of judicial power, demands the
following: 1) there must be an actual case calling for the exercise of judicial power; 2) the question must
be ripe for adjudication; and 3) the person challenging must have “standing”; that is, he has personal and
substantial interest in the case, such that he has sustained or will sustain direct injury.
In the case at bar, it is at once apparent that petitioners are not requesting that this Court reverse the
ruling of the appellate court and disallow the admission in evidence of respondent Roque’s testimony;
inasmuch as the assailed decision does not appear to be in conflict with any of their present claims.
Petitioners filed this suit out of fear that the assailed decision would frustrate the purpose of said law,
which is to encourage witnesses to come out and testify. But their apprehension is neither justified nor
exemplified by this particular case. A mere apprehension does not give rise to a justiciable controversy.
 PHILIPPINE LONG DISTANCE TELEPHONE COMPANY vs. MONTEMAYOR

FACTS:
As a regular Traffic Operators at petitioner’s Davao Office, it was the main function of private respondents
Totesora and Marcos to process long distance calls. Said respondents were caught passing free long
distance calls to Manila. Ms. Totesora stated that it was not altogether a free call; that she just allowed
the parties to talk a little longer without timing the entire call. Ms. Marcos admitted placing a free call to
her brother in Manila. Finding their explanations unsatisfactory, petitioner terminated their services. With
respect to respondent Macabenta, she claimed that she worked continuously for petitioner from April
1985 to August 1986, she should have been regularised long before. Hence, her termination was illegal.
Employees and petitioner submit their dispute to voluntary arbitration and be bound by the decision of
Voluntary Arbitrator. Petitioner alleged that public respondent erred in rendering assailed resolutions.

ISSUE:
Whether or not the resolution of public respondent is subject to judicial review.

RULING:
Apropos of the power of judicial review, while decisions of voluntary arbitrator are given the highest
respect and accorded a certain measure of finality, this does not preclude the exercise of judicial review
over such decisions. A voluntary arbitrator, by the nature of his functions, acts in a quasi-judicial capacity.
There is no reason why his decisions involving interpretations of law should be beyond the Supreme
Court’s review.
 KALILID WOOD INDUSTRIES CORPORATION vs. COURT OF APPEALS

FACTS:
Jose Briones, Jr. was granted Original Timber License No. 738-62 for a 5,950 hectare forest area in Loreto,
Agusan del Sur. On June 29,1962, he applied for renewal of the license, but the Director of Forestry denied
his application. While said motion for reconsideration was pending, another timber license, P.B. De Jesus,
now Kalilid Wood Industries Corporation applied for the same area. The Secretary of Agriculture and
Natural Resources Lopez approved the application of de Jesus and directed the Director of Forestry to
expedite action on the application. The Director of Forestry, instead of acting on the application,
recommended renewal of the expired license of Briones. On November 24, 1989, the Minister of Natural
Resources Leido, issued two letter orders in accordance with the Reyes decision.

ISSUE:
Whether or not the Agusan Trial Courts have jurisdiction to enjoin execution of a final judgment of the
Manila Court, which is a co-equal and coordinate branch of the same trial court.

RULING:
The Court ruled among others: that the issue as to the validity of November 24, 1989 letter orders of the
Minister of Resources cannot be relitigated; that a final judgment of this Court cannot be altered or
modified by the lower courts; and that this Court cannot reverse or set aside its own final and executory
decisions simply because the Executive Department flip-flopped and arrived at new resolutions reversing
their earlier decisions already bought before this Court and finally adjudicated. Accordingly, it ruled,
among others that the orders issued by the Regional Trial Court of Manila, the Regional Trial Court of
Quezon City and the Regional Trial Court of Makati pursuant to Mathay decision are reversed and set
aside; and the Reyes decision is declared to be final and must prevail over the Mathay decision.