CONSTITUTIONAL LAW 1 Liban v. Gordon (2009)
175352 | July 15, 2009
Petitioners: Dante V. Liban, Reynaldo M. Bernardo and Salvador M. Viari
(officers of the Board of Directors of the Quezon City Red Cross Chapter)
Respondent: Richard J. Gordon (Chairman of the Philippine National Red
Cross Board of Governors)
CARPIO, J.
Petition to declare Senator Richard J. Gordon as having forfeited his seat in
the Senate.
CONCEPTS AND PROVISIONS:
Section 5, Rule 66 of the Rules of Civil Procedure. Only a person claiming
to be entitled to a public office usurped or unlawfully held by another may
bring an action for quo warranto in his own name.
Sec. 11, Rule 66 of the Rules of Civil Procedure. Limitations.— Nothing
contained in this Rule shall be construed to authorize an action against a
public officer or employee for his ouster from office unless the same be com-
menced within one (1) year after the cause of such ouster, or the right of the
petitioner to hold such office or position, arose; nor to authorize an action
for damages in accordance with the provisions of the next preceding section
unless the same be commenced within one (1) year after the entry of the
judgment establishing the petitioner’s right to the office in question.
Sec. 13, Art. VI, 1987 Constitution. No Senator or Member of the House of
Representatives may hold any other office or employment in the Govern-
ment, or any subdivision, agency, or instrumentality thereof, including gov-
ernment-owned or controlled corporations or their subsidiaries, during his
term without forfeiting his seat. Neither shall he be appointed to any office
which may have been created or the emoluments thereof increased during
the term for which he was elected.
Secs. 16 & 17, Art. VII, 1987 Constitution.
Sec. 2(13), Introductory Provisions, Administrative Code of 1987. General
Terms Defined.—(13) [GOCC] refers to any agency organized as a stock or
non-stock corporation, vested with functions relating to public needs
G.R. No.
whether governmental or proprietary in nature, and owned by the Govern-
ment directly or through its instrumentalities either wholly, or where ap-
plicable as in the case of stock corporations, to the extent of at least 51%
of its capital stock.
Sec. 7, Art. XIV, 1935 Constitution. The Congress shall not, except by gen-
eral law, provide for the formation, organization, or regulation of private
corporations, unless such corporations are owned or controlled by the Gov-
ernment or any subdivision or instrumentality thereof.
QUO WARRANTO
- generally commenced by the Government as the proper party plaintiff;
Sec. 1(b), Rule 66, Rules of Court: An action for the usurpation of office or
franchise may be brought in the name of the Republic of the Philippines
against: x x x (b) A public officer who does or suffers an act which, by the
provisions of law, works a forfeiture of his office).
- Under Sec. 6 (Sec. 5 in case), Rule 66, Rules of Court, “A person claiming
to be entitled to a public office or position usurped or unlawfully held
or exercised by another may bring an action therefor in his own name.”
The person instituting quo warranto proceedings in his own behalf must
claim and be able to show that he is entitled to the office in dispute, oth-
erwise the action may be dismissed at any stage.
FACTS:
1) During incumbency as a member of the Senate, respondent was elected
Chairman of the PNRC during the Feb. 23, 2006 meeting of the PNRC
Board of Governors
2) Petitioners allege that by accepting chairmanship, respondent ceased
to be a member of the Senate per Sec. 13, Art. VI of the 1987 Constitu-
tion. They cite:
1. Camporedondo v. NLRC (1999)**. Held: PNRC is a GOCC
2. Flores v. Drilon (1993). Held: Incumbent national legislators lose
their elective posts upon their appointment to another government
office
3) In respondent’s Comment:
CONSTITUTIONAL LAW 1 Liban v. Gordon (2009)
• He asserts that petitioners have no legal standing to file the peti-
tion which appears to be an action for quo warranto since the peti-
tion alleges that respondent committed an act which, by provision
of law, constitutes a ground for forfeiture of his public office. Peti-
tioners do not claim to be entitled to the Senate office of re-
spondent. See Sec. 5, Rule 66 of the Rules of Civil Procedure. If the
petition is one for quo warranto, it is already barred by prescription
since under Sec. 11, Rule 66 of the Rules of Civil Procedure, the action
should be commenced within one year after the cause of the public
officer’s forfeiture of office. But respondent has been working as a
Red Cross volunteer for the past 40 years and was already Chairman
of the PNRC Board of Governors when he was elected Senator in
May 2004, having been elected Chairman in 2003 and re-elected in
2005.
• He contends that even if the present petition is treated as a tax-
payer’s suit, petitioners cannot be allowed to raise a constitutional
question in the absence of any claim that they have suffered some
actual damage or threatened injury as a result of the allegedly ille-
gal act of respondent.
• He also maintains that if the petition is treated as one for declara-
tory relief, the Court would have no jurisdiction since original juris-
diction for declaratory relief lies with the RTC.
• He further insists that the PNRC is not a GOCC and that the prohi-
bition under Sec. 13, Art. VI of the 1987 Constitution does not apply
in the present case since volunteer service to the PNRC is neither an
office nor an employment.
4) In the petitioners’ Reply:
• They claim that their petition is neither an action for quo warrants
nor an action for declaratory relief.
• They maintain that the present petition is a taxpayers’ suit ques-
tioning the unlawful disbursement of funds, considering that re-
spondent has been drawing his salaries and other compensation as
a Senator.
• They point out that the Court has jurisdiction since it involves a le-
gal or constitutional issue which is of transcendental im-
portance.
G.R. No. 175352 | July 15, 2009
SUBSTANTIAL ISSUE: W/N the office of the PNRC Chairman is a govern-
ment office or an office in a government-owned or controlled corporation
for purposes of prohibition in Section 13, Article VI of the Constitution
HELD: NO.
PNRC is a private organisation performing public functions.
The PNRC has to be autonomous and must operate in conformity of the
Fundamental Principles of the International Red Cross and Red Crescent
Movement in order to be recognised as a member National Society thereof
(Art. 4[4][10] of the Statutes of the International Red Cross and Red Cres-
cent Movement).
To ensure and maintain its autonomy, neutrality and independence, the
PNRC cannot be seen as a GOCC and neither can the PNRC volunteers be
identified as government personnel or as instruments of government policy.
Otherwise, the insurgents or separatists will treat PNRC volunteers as ene-
mies when the volunteers tend to the wounded in the battlefield or the dis-
placed civilians in conflict areas.
M/N: In short, it should be independent in fact and in appearance.
Indeed, the Philippine government does not own PNRC. The PNRC does
not have government assets and does not receive any appropriation from
the Congress. The PNRC is financed primarily by contributions from pri-
vate individuals and private entities obtained through solicitation cam-
paigns.
The Philippine government does not control PNRC. Under the PNRC
Charter, as amended, only six of the thirty members of the PNRC Board of
Governors are appointed by the President of the Philippines. An over-
whelming majority of four-fifths of the PNRC Board are elected or chosen
by the private sector members of the PNRC (Sec. 6, PNRC Charter). The in-
cumbent Chairman of PNRC, respondent Senator Gordon, was elected
by a private sector-controlled PNRC Board.
CONSTITUTIONAL LAW 1 Liban v. Gordon (2009)
The PNRC Chairman is not appointed by the President or by any subordi-
nate government official. Thus, the PNRC Chairman is not an official or em-
ployee of the Executive branch since his appointment does not fall under
Sec. 16, Art. VII of the Constitution. Certainly, the PNRC Chairman is not
an official or employee of the Judiciary or Legislature. It leads to the obvious
conclusion that the PNRC Chairman is not an official or employee of the
Philippine Government. Not being a government official or employee,
the PNRC Chairman, as such, does not hold a government office or em-
ployment.
Pursuant to Sec. 17, Art. VII of the 1987 Constitution on the President’s power
of control over all government offices: The President cannot reverse or
modify the decisions or actions of the PNRC Board. Neither can the Presi-
dent reverse or modify the decisions or actions of the PNRC Chairman. It is
the PNRC Board that can review, reverse or modify the decisions or actions
of the PNRC Chairman. This proves again that the office of the PNRC Chair-
man is a private office, not a government office. Thus, the PNRC is a pri-
vately owned, privately funded and privately run charitable organiza-
tion. The PNRC is not a GOCC.
**Camporedondo v. NLRC: In ruling that the PNRC is a GOCC, the simple
test used was whether the corporation was created by its own special char-
ter for the exercise of a public function or by incorporation under the general
corporation law. Since the PNRC was created under a special charter, the
Court then ruled that it is a GOCC. However, the Camporedondo ruling failed
to consider the definition of a GOCC as provided under Sec. 2(13) of the
Introductory Provisions of the Administrative Code of 1987. Under this
criterion, and as discussed above, the government does not own or control
PNRC.
The PNRC Charter is violative of the constitutional proscription against
the creation of private corporations by special law.
Section 1 of the PNRC Charter, as amended, creates the PNRC as a “body
corporate and politic.” The 1935 Constitution, as amended, was in force
when the PNRC was created by special charter on March 22, 1947. See Sec.
7, Art. XIV, 1935 Constitution.
G.R. No. 175352 | July 15, 2009
In Feliciano v. Commission on Audit (2004), the Court explained the constitu-
tional provision (Sec. 16, Art. XII, 1987 Constitution) prohibiting Congress
from creating private corporations. Congress cannot enact a law creating a
private corporation with a special charter. Such legislation would be uncon-
stitutional. Only corporations created under a general law (Corporation
Code) can qualify as private corporations. Congress can create corporations
with special charters only if such corporations are government-owned or
controlled. Held: Local water districts are considered GOCCs not only be-
cause of their creation by special charter (P.D. No. 198) but also because the
government in fact owns and controls the local water districts. Unlike the
local water districts, the elements of ownership and control are clearly
lacking in the PNRC.
In creating the PNRC as a corporate entity, Congress was in fact creating a
private corporation. However, the constitutional prohibition against the
creation of private corporations by special charters provides no exception
even for non-profit or charitable corporations. Consequently, the PNRC
Charter, insofar as it creates the PNRC as a private corporation and
grants it corporate powers, is void for being unconstitutional.
Thus, Secs. 1-3, 4(a), 5-13 of the PNRC Charter, as amended, are void.
The other provisions (Secs. 4(b)(c), 14-17) of the PNRC Charter remain
valid as they can be considered as a recognition by the State that the unin-
corporated PNRC is the local National Society of the Movement, and thus
entitled to the benefits, exemptions and privileges set forth in the PNRC
Charter.
In sum, we hold that the office of the PNRC Chairman is not a govern-
ment office or an office in a GOCC for purposes of the prohibition in Sec.
13, Art. VI, 1987 Constitution. However, since the PNRC Charter is void in-
sofar as it creates the PNRC as a private corporation, the PNRC should in-
corporate under the Corporation Code and register with the Securities
and Exchange Commission if it wants to be a private corporation.
RULING: WHEREFORE, we declare that the office of the Chairman of the
PNRC is not a government office or an office in a GOCC for purposes of the
prohibition in Sec. 13, Art. VI of the 1987 Constitution. We also declare that
CONSTITUTIONAL LAW 1 Liban v. Gordon (2009) G.R. No. 175352 | July 15, 2009

Sections 1, 2, 3, 4(a), 5, 6, 7, 8, 9, 10, 11, 12, and 13 of the Charter of the Phil-
ippine National Red Cross, or Republic Act No. 95, as amended by Presiden-
tial Decree Nos. 1264 and 1643, are VOID because they create the PNRC
as a private corporation or grant it corporate powers.
ON STANDING: Petitioners have no standing to file this petition.
A careful reading of the petition reveals that it is an action for quo warranto.
Petitioners filed an action for usurpation of public office against respondent,
a public officer who allegedly committed an act which constitutes a ground
for the forfeiture of his public office. Clearly, such an action is for quo war-
ranto, specifically under Section 1(b), Rule 66 of the Rules of Court.
flow from one’s election as Senator. The fact that the PNRC Chairman
is not appointed by the President and the fact that the former does not
receive any compensation do not at all give the said position an ex officio
character such that the occupant thereof becomes exempt from the
constitutional proscription on the holding of multiple offices.
4. Senator Gordon, in assuming the chairmanship while being a mem-
ber of the Senate, is clearly violating Sec. 13, Art. VI of the Constitu-
tion. Senator Gordon’s holding of both offices may result in a divided
focus of his legislative functions, and in a conflict of interest as when a
possible amendment of the PNRC Charter is lobbied in Congress when
the PNRC and its officials become subjects of legislative inquiries.

Petitioners do not claim to be entitled to the Senate office of respond- IN VIEW OF THE FOREGOING, I vote to GRANT the petition.
ent. Clearly, petitioners have no standing to file the present petition. Even
if the Court disregards the infirmities of the petition and treats it as a tax-
payer’s suit, the petition would still fail on the merits.

DISSENTING OPINION (NACHURA, J.):

1. The present petition should be treated as one for prohibition rather
than for quo warranto. In the main, the petitioners seek the declaration
that Senator Gordon has forfeited his seat in the Senate, and the con-
sequent proscription from further acting or representing himself as a
Senator and from receiving the salaries, emoluments, compensations,
privileges and benefits thereof. The remedy sought is preventive and
restrictive—an injunction against an alleged continuing violation of
the fundamental law. Petitioners raise a constitutional issue, without
claiming any entitlement to either the Senate seat or the chairmanship
of PNRC.
2. Following the logic in Feliciano, PNRC cannot be anything but a GOCC.
As ruled in Camporedondo, which was reiterated in Baluyot v. Holganza
(2000), the amendment of the Charter did not have the effect of trans-
forming it into a private corporation.
3. The Chairmanship of the PNRC Board is not held in an ex officio1 ca-
pacity by a member of Congress. The PNRC chairmanship does not

1 “fromoffice”; “by virtue of office”; It refers to an “authority derived from official member by virtue of his title to a certain office, and without further warrant or ap-
character merely, not expressly conferred upon the individual character, but rather pointment.
annexed to the official position.” An ex officio member of a board is one who is a
CONSTITUTIONAL LAW 1 Liban v. Gordon (2011)
Petitioners: Dante V. Liban, Reynaldo M. Bernardo and Salvador M. Viari
Respondent: Richard J. Gordon
Intervenor: Philippine National Red Cross
LEONARDO-DE CASTRO, J.
This resolves the Motion for Clarification and/or for Reconsideration, filed
by respondent Senator Gordon, of the Decision promulgated by the Su-
preme Court on July 15, 2009, the Motion for Partial Reconsideration, by
movant-intervenor PNRC, and the latter’s Manifestation and Motion to
Admit Attached Position Paper.
MOTIONS AND THEIR RESOLUTION:
Motion for Clarification and/or for Reconsideration (Respondent)
Grounds:
1. The issue of constitutionality of R.A. No. 95 was not raised by the par-
ties, the Court went beyond the case in deciding such issue
2. As the Court decided that Petitioners did not have standing to file the
instant Petition, the pronouncement of the Court on the validity of R.A.
No. 95 should be considered obiter.
Resolution:
The issue of constitutionality was not the very lis mota of the case. The Court
should not have declared void certain sections of the PNRC Charter. Instead,
the Court should have exercised judicial restraint on this matter, especially
since there was some other ground upon which the Court could have
based its judgment. Furthermore, the PNRC, the entity most adversely
affected by this declaration of unconstitutionality, which was not even
originally a party to this case, was being compelled, as a consequence of
the Decision, to suddenly reorganise and incorporate under the Corpo-
ration Code, after more than 60 years of existence in this country.
The passage of several laws relating to the PNRC’s corporate existence, not-
withstanding the effectivity of the constitutional proscription on the crea-
tion of private corporations by law, is a recognition that the PNRC is not
strictly in the nature of a private corporation contemplated by the constitu-
G.R. No. 175352 | January 18, 2011
tional ban (Sec. 7, Art. XIV, 1935 Constitution; Sec. 4, Art. XIV, 1973 Consti-
tution; Sec. 16, Art. XII, 1987 Constitution).
Motion for Partial Reconsideration (Intervenor)
Grounds:
A. Decision deprived PNRC of its constitutional right to due process
1) PNRC was never a party to the controversy
2) Constitutionality was never an issue in this case
B. Current charter of PNRC is P.D. No. 1264 and not R.A. No. 95; P.D. No.
1264 was not a creation of Congress
C. PNRC’s structure is sui generis. While it is performing humanitarian func-
tions as an auxiliary to the government, it is a neutral entity separate
and independent of government control, yet it does not qualify as
strictly private in character.
Resolution:
There is merit in PRC’s contention that its structure is sui generis. A closer
look at the nature of the PNRC would show that there is none like it not just
in terms of structure, but also in terms of history, public service and official
status accorded to it by the State and the international community. The pro-
visions of R.A. No. 95, as amended, show the historical background and le-
gal basis of the creation of the PNRC by legislative fiat, as a voluntary or-
ganisation impressed with public interest.
The significant public service rendered by the PNRC can be gleaned from
Sec. 3 of its Charter (declared unconstitutional in July 15, 2009 Decision)
stating its purposes.
National Societies such as the PNRC act as auxiliaries to the public author-
ities of their own countries in the humanitarian field and provide a range of
services including disaster relief and health and social programmes.
National Societies have certain specificities deriving from the 1949 Geneva
Convention and the Statutes of the Movement. A National Society par-
takes of a sui generis character. It is a protected component of the Red Cross
movement under the First Geneva Convention, especially in times of armed
conflict. This sui generis character is also emphasised by the Fourth Geneva
Convention which holds that an Occupying Power cannot require any
CONSTITUTIONAL LAW 1 Liban v. Gordon (2011)
change in the personnel or structure of a National Society. National so-
cieties are therefore organizations that are directly regulated by interna-
tional humanitarian law, in contrast to other ordinary private entities,
including NGOs.
The Court must recognise the country’s adherence to the Geneva Convention
and respect the unique status of the PNRC in consonance with its treaty ob-
ligations. Under the Constitution, the Philippines adopts the generally ac-
cepted principles of international law as part of the law of the land (Sec. 3,
Art. II, 1935/1973 Constitution; Sec. 2, Art. II, 1987 Constitution). This con-
stitutional provision must be reconciled and harmonised with Sec. 16,
Art. XII of the Constitution, instead of using the latter to negate the for-
mer.
The PNRC can neither be classified as an instrumentality of the State, so
as not to lose its character of neutrality as well as its independence, nor
strictly as a private corporation since it is regulated by international hu-
manitarian law and is treated as an auxiliary of the State.
The auxiliary status of a Red Cross Society means that it is at one and the
same time a private institution and a public service organisation because the
very nature of its work implies cooperation with the authorities, a link with
the State.
In Feliciano, it was explained that the purpose of Sec. 16, Art. XII, 1987 Con-
stitution prohibiting Congress from creating private corporations was to
prevent the granting of privileges to certain individuals, families, or groups,
which were denied to other groups. The PNRC Charter does not come within
the spirit of this constitutional provision as it does not grant special privi-
leges to a particular individual, family, or group, but creates an entity
that strives to serve the common good.
A strict and mechanical interpretation of the provision will hinder the State
in adopting measures that will serve the public good or national interest.
(Note: The Philippine Cooperative Code of 2008 vests corporate power and
capacities upon cooperatives which are private corporations, in order to im-
plement the State’s avowed policy).
G.R. No. 175352 | January 18, 2011
Based on the above, the sui generis status of the PNRC is now sufficiently
established. “As correctly mentioned by Justice Roberto A. Abad, the sui
generis character of the PNRC requires us to approach controversies in-
volving the PNRC on a case-to-case basis.”
The Court should not shake its existence to the core in an untimely and drastic
manner that would not only have negative consequences to those who depend
on it in times of disaster and armed hostilities but also have adverse effects on
the image of the Philippines in the international community. The sections of
the PNRC Charter that were declared void must therefore stay.
WHEREFORE, premises considered, respondent Richard J. Gordon’s Mo-
tion for Clarification and/or for Reconsideration and movant-intervenor
PNRC’s Motion for Partial Reconsideration of the Decision in G.R. No.
175352 dated July 15, 2009 are GRANTED. / The constitutionality of R.A.
No. 95, as amended, the charter of the Philippine National Red Cross, was
not raised by the parties as an issue and should not have been passed
upon by this Court. / The structure of the PNRC is sui generis, being nei-
ther strictly private nor public in nature. / R.A. No. 95 remains valid and
constitutional in its entirety. / The dispositive portion of the Decision
should therefore be MODIFIED by deleting the second sentence, to now
read as follows:
“WHEREFORE, we declare that the office of the Chairman of the Philippine
National Red Cross is not a government office or an office in a government-
owned or controlled corporation for purposes of the prohibition in Section
13, Article VI of the 1987 Constitution.”
SO ORDERED.
DISSENTING OPINION (CARPIO, J.):
1. Back to July 15, 2009 decision—PNRC is a private corporation
2. In view of the Court’s finding that the PNRC is a private corporation, it
was imperative for the Court to address the issue of the creation of the
PNRC through a special charter. On PNRC’s existence for 60 years: there
is no prescription to declare a law unconstitutional.
3. Even if the PNRC derived its existence from PD 1264, still the constitu-
tional prohibition will apply. Pres. Marcos could not issue decrees or or-
ders contrary to the provisions of the Constitution. Legislative power
CONSTITUTIONAL LAW 1 Liban v. Gordon (2011)
cannot be exercised in violation of the Constitution from which legisla-
tive power draws its existence.
4. PNRC cannot claim that it is sui generis just because it is a private organ-
isation performing certain public or governmental functions. The ex-
press prohibition against the creation of private corporations by special
charter cannot be disregarded just because a private corporation claims
to be sui generis. The constitutional prohibition admits of no exception.
5. The PNRC could either choose to remain unincorporated or it could
adopt its own by-laws and incorporate under the Corporation Code and
register with the SEC if it wants to be a private corporation.
Accordingly, I vote to DENY the Motions for Reconsideration.
G.R. No. 175352 | January 18, 2011
CONCURRING OPINION (ABAD, J.):
There is a need to examine the Court’s decision in this case considering its far
reaching effects. Allowing such decision to stand will create innumerable mis-
chief that would hamper the PNRC’s operations. With a void juridical person-
ality, it cannot open a bank account, issue tax- exempt receipts for donations,
or enter into contracts for delivery of rescue reliefs like blood, medicine, and
food. Its officers would be exposed to suits in their personal capacities. The va-
lidity of its past transactions would be open to scrutiny and challenge. Neither
the country nor the PNRC needs this.
1. Congress created the PNRC to comply with the country’s commitments
under the Geneva Conventions. To require the PNRC to incorporate un-
der the general law is to disregard its unique standing under interna-
tional conventions. It also ignores the very basic premise for the PNRC’s
creation.
2. PNRC is a hybrid organisation that derives certain peculiarities from in-
ternational humanitarian law. For this reason, its organisational charac-
ter does not fit the parameters provided by either the Corporation Code
or Administrative Code. It is a sui generis entity that draws its nature
from the Geneva Conventions, the Statutes of the Movement and the
law creating it.
3. The Constitution does not preclude the creation of corporations that
may neither be classified as private nor governmental. It does not forbid
Congress from creating organisations that do not belong to these two
general types.
4. The sui generis character of the PNRC does not necessarily overturn the
rulings of the Court in Camporedondo and Baluyot. The PNRC’s excep-
tional nature admits of the conclusions reached in those cases that the
PNRC is a GOCC for the purpose of enforcement of labor laws and penal
statutes. The PNRC’s sui generis character compels us to approach con-
troversies involving the PNRC on a “case-to-case” basis, bearing in
mind its distinct nature, purposes and special functions. Rules that gov-
ern traditional private or public entities may thus be adjusted in re-
lation to the PNRC and in accordance with the circumstances of each
case.