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Yazaki Torres Manufacturing, Inc. v.

CA, The Home Development Mutual Fund (HDMF), through its Board of Trustees
(BOT), and Honorable Zorayda Amelia Alonzo, as Pres. of the HDMF
Sandoval-Gutierrez, J.
June 27, 2006
G.R. No. 130584
Doctrine

The doctrine of necessary implication states that the grant of express power to formulate implementing rules and
regulations must necessarily include the power to amend, revise, alter, or repeal the same.

Summary

Petitioner was previously granted a waiver from the Fund coverage for the year 1995. Upon application for renewal,
the HDMF denied petitioner on the ground that according to the Amended Rules and Regulations, a housing plan must
now be coupled with the retirement plan for employees to avail of waiver. The Court ruled that the grant of waiver is a
privilege granted by the HDMF and applied the doctrine of necessary implication.

Facts

Ratio/Issues

June 11, 1978: PD 1530 was signed into law, creating the PAG-IBIG 1 FUND. The HDMF was the government
agency tasked with the administration of the Fund.2
July 18, 1994: The HDMF BOT promulgated Rules and Regulations implementing RA 7742 wherein Rule VII
provides that an employer and/or employee group who has an existing provident or retirement plan, with features
superior to the Fund, may apply for waiver or suspension of coverage. The certificate of waiver shall be valid for a
year, subject to renewal, within sixty (60) days prior to expiration of the existing waiver or suspension.
For the year 1995, petitioner was granted a waiver from the Fund coverage as its retirement plan for its employees
is superior to that offered by the Fund.
September 1, 1995: HDMF BOT amended Rule VII stating that, "An employer with a plan providing both for a
provident/retirement and housing benefits for all his employees... must be superior to the provident/retirement
and housing benefits offered by the Fund." [emphasis supplied]
February 16, 1996: The HDMF CEO disapproved petitioner's application on the ground that it has no housing
benefits and its retirement plan is not superior to that provided by the Fund.
Appeal to HDMF BOT and CA: denied!
Petitioner's argument: Rules and regulations cannot be amended since the September 1, 1995 amendment on
Rule VII of the HDMF rules and regulations was beyond the 60-day period required, thus the same is invalid.
Court's ratio: The amendment is in harmony of the Whereas clause of PD1752: "...In pursuit of...humanist
commitment to the interests of the working group, in relation particularly to their need for decent shelter..."
MR denied, hence, this petition for certiorari.

WON HDMF BOT acted with grave abuse of discretion in denying petitioner's application for renewal or waiver
of the Fund membership coverage. (NO)
(1) First, doctrine that courts will not interfere in matters which are addressed to the sound discretion of the
government agency entrusted with regulation of activities coming under the special and technical training and
knowledge of such agency.
There is no showing that HDMF arbitrarily, whimsically or capriciously denied petitioner's application for
renewal of waiver. It conducted investigation, comparison, evaluation and deliberation of petitioner's
retirement plan vis-a-vis the Fund.
(2) Second, the grant of waiver or exemption from the coverage of the Fund is but a mere privilege
There is no provision in RA 7742 that HDMF shall automatically renew a waiver from the Fund coverage.
(3) Under the Amended Rules and Regulations, superior retirement plan and superior housing plan are joint
requirements.

II. WON HDMF BOT has the authority to amend its Rules. (YES)
(1) The legislative power is granted pursuant to Section 1, Article VI, CONST3.
(2) The legislature cannot foresee every contingency involved in a particular problem that it seeks to address.

1 "Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya, Gobyerno"


2 Dec. 14, 1980: PD 1752 provided that membership in the Fund is mandatory for all gainfully employed Filipinos. June 17, 1994: RA 7742 extends
coverage of the Fund to all members of SSS and GSIS, as well as employers. However, membership is voluntary for employees earning less than
P4,000.00 a month.

Thus, rules and regulations promulgated by an administrative agency are the product of a delegated power to
create new or additional legal provisions that have the effect of law. Hence, in general, rules and regulations
issued by an administrative agency, pursuant to the authority conferred upon it by law, have the force and
effect, or partake of the nature, of a statute.
(3) See DOCTRINE.
Held

Petition DISMISSED. CA AFFIRMED in toto.

Prepared by: KM Liberato [Admin | Prof. Pulumbarit]

3 "The legislative power shall be vested in the Congress of the Phils. which shall consist of a Senate and a HoR, except to the extent reserved to the
people by the provision on initiative and referendum.

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