Nathalie Ang 2009-78224 Tarrosa v Singson G.R. No.

111243 | May 25, 1994 | Quiason Facts: Respondent Singson was appointed Governor of the Bangko Sentral by President Fidel V. Ramos on July 2, 1993, effective on July 6, 1993. Petitioner argues that respondent Singson's appointment is null and void since it was not submitted for confirmation to the Commission on Appointments. The petition is anchored on the provisions of Section 6 of R.A. No. 7653, which established the Bangko Sentral as the Central Monetary Authority of the Philippines. Section 6, Article II of R.A. No. 7653 provides that the Governor of the Bangko Sentral shall be head of a department and his appointment shall be subject to confirmation by the Commission on Appointments. In their comment, respondents claim that Congress exceeded its legislative powers in requiring the confirmation by the Commission on Appointments of the appointment of the Governor of the Bangko Sentral. They contend that an appointment to the said position is not among the appointments which have to be confirmed by the Commission on Appointments, citing Section 16 of Article VII of the Constitution. Respondents also aver that the Bangko Sentral has its own budget and accordingly, its budgetary requirements are not subject to the provisions of the General Appropriations Act. Issue: WON petitioner, as taxpayer, can bring forth a quo warranto suit and question Singsons title to the office of Governor of Bangko Sentral Held: No. The instant petition is in the nature of a quo warranto proceeding as it seeks the ouster of respondent Singson and alleges that the latter is unlawfully holding or exercising the powers of Governor of the Bangko Sentral. Such a special civil action can only be commenced by the Solicitor General or by a "person claiming to be entitled to a public office or position unlawfully held or exercised by another" (Revised Rules of Court, Rule 66, Sec. 6). It is obvious that the instant action was improvidently brought by petitioner. To uphold the action would encourage every disgruntled citizen to resort to the courts, thereby causing incalculable mischief and hindrance to the efficient operation of the governmental machinery. In Sevilla v. Court of Appeals, 209 SCRA 637 (1992), we held that the petitioner therein, who did not aver that he was entitled to the office of the City Engineer of Cabanatuan City, could not bring the action for quo warranto to oust the respondent from said office as a mere usurper. Likewise in Greene v. Knox, 175 N.Y. 432 (1903), 67 N.E. 910, it was held that the question of title to an office, which must be resolved in a quo warranto proceeding, may not be determined in a suit to restrain the payment of salary to the person

holding such office, brought by someone who does not claim to be the one entitled to occupy the said office. Separate Opinion, Padilla: I would anchor said dismissal squarely on the ruling laid down by the Court in Calderon vs. Carale, 208 SCRA 254 (1992), to the effect that appointments by the President of the Philippines, which under the Constitution (Sec. 16, Article VII) are not among those required to be confirmed by the Commission on Appointments, may not, by legislation, be made subject to such confirmation. Mendoza v Allas G.R. No. 131977 | February 4, 1999 | Puno Facts: Petitioner Pedro Mendoza joined the Bureau of Customs in 1972. He held the positions of Port Security Chief from March 1972 to August 1972, Deputy Commissioner of Customs from August 1972 to September 1975, Acting Commissioner of Customs from September 1975 to April 1977 and Customs Operations Chief I from October 1987 to February 1988. On March 1, 1988, he was appointed Customs Service Chief of the Customs Intelligence and Investigation Service (CIIS). In 1989, the position of Customs Service Chief was reclassified by the Civil Service as "Director III" in accordance with Republic Act No. 6758 and National Compensation Circular No. 50. Petitioner's position was thus categorized as "Director III, CIIS" and he discharged the function and duties of said office. On April 22, 1993, petitioner was temporarily designated as Acting District Collector, Collection District X, Cagayan de Oro City. In his place, respondent Ray Allas was appointed as "Acting Director III" of the CIIS. Despite petitioner's new assignment as Acting District Collector, however, he continued to receive the salary and benefits of the position of Director III. In September 1994, petitioner received a letter from Deputy Customs Commissioner Cesar Z. Dario, informing him of his termination from the Bureau of Customs, in view of respondent Allas' appointment as Director III by President Fidel V. Ramos. Petitioner wrote the Customs Commissioner demanding his reinstatement with full back wages and without loss of seniority rights. No reply was made. On December 2, 1994, petitioner filed a petition for quo warranto against respondent Allas before the Regional Trial Court, Paranaque, Branch 258. The court found that petitioner was illegally terminated from office without due process of law and in violation of his security of tenure, and that as he was deemed not to have vacated his office, the appointment of respondent Allas to the same office was void ab initio. The court ordered the ouster of respondent Allas from the position of Director III, and at the same time directed the reinstatement of petitioner to the same position with payment of full back salaries and other benefits appurtenant thereto.

Respondent Allas appealed to the Court of Appeals.On February 8, 1996, while the case was pending before said court, respondent Allas was promoted by President Ramos to the position of Deputy Commissioner of Customs for Assessment and Operations. As a consequence of this promotion, petitioner moved to dismiss respondent's appeal as having been rendered moot and academic. The Court of Appeals granted the motion and dismissed the case accordingly. On May 9, 1996, petitioner filed with the court a quo a Motion for Execution of its decision. On July 24, 1996, the court denied the motion on the ground that the contested position vacated by respondent Allas was now being occupied by respondent Godofredo Olores who was not a party to the quo warranto petition. Issue: WON the Court of Appeal erred when it denied the motion for execution of Petitioner Held: NO. The nature of the writ of quo warranto is that it is never directed to an officer as such, but always against the person-- to determine whether he is constitutionally and legally authorized to perform any act in, or exercise any function of the office to which he lays claim. In the case at bar, the petition for quo warranto was filed by petitioner solely against respondent Allas. What was threshed out before the trial court was the qualification and right of petitioner to the contested position as against respondent Ray Allas, not against Godofredo Olores. Ordinarily, a judgment against a public officer in regard to a public right binds his successor in office. This rule, however, is not applicable in quo warranto cases. A judgment in quo warranto does not bind the respondent's successor in office, even though such successor may trace his title to the same source. Petitioner has apprised this Court that he reached the compulsory retirement age of sixty-five (65) years on November 13, 1997. Reinstatement not being possible, petitioner now prays for the payment of his back salaries and other benefits from the time he was illegally dismissed until finality of the trial court's decision. However, respondent Allas cannot be held personally liable for petitioner's back salaries and benefits. He was merely appointed to the subject position by the President of the Philippines in the exercise of his constitutional power as Chief Executive. Neither can the Bureau of Customs be compelled to pay the said back salaries and benefits of petitioner. The Bureau of Customs was not a party to the petition for quo warranto. About Quo Warranto under Rule 66: Quo warranto is a demand made by the state upon some individual or corporation to show by what right they exercise some franchise or privilege appertaining to the state which, according to the Constitution and laws of the land, they cannot legally exercise except by virtue of a grant or authority from the state. In other words, a petition for quo warranto is a proceeding to determine the right of a person to the use or exercise of a franchise or office and to oust the holder from its enjoyment, if his

claim is not well-founded, or if he has forfeited his right to enjoy the privilege. The action may be commenced for the Government by the Solicitor General or the fiscal against individuals who usurp a public office, against a public officer whose acts constitute a ground for the forfeiture of his office, and against an association which acts as a corporation without being legally incorporated. The action may also be instituted by an individual in his own name who claims to be entitled to the public office or position usurped or unlawfully held or exercised by another. Where the action is filed by a private person, he must prove that he is entitled to the controverted position, otherwise respondent has a right to the undisturbed possession of the office. If the court finds for the respondent, the judgment should simply state that the respondent is entitled to the office. If, however, the court finds for the petitioner and declares the respondent guilty of usurping, intruding into, or unlawfully holding or exercising the office, judgment may be rendered as follows: "Sec. 10. Judgment where usurpation found.-- When the defendant is found guilty of usurping, intruding into, or unlawfully holding or exercising an office, position, right, privilege, or franchise, judgment shall be rendered that such defendant be ousted and altogether excluded therefrom, and that the plaintiff or relator, as the case may be, recover his costs. Such further judgment may be rendered determining the respective rights in and to the office, position, right, privilege, or franchise of all the parties to the action as justice requires." If it is found that the respondent or defendant is usurping or intruding into the office, or unlawfully holding the same, the court may order: (1) The ouster and exclusion of the defendant from office; (2) The recovery of costs by plaintiff or relator; (3) The determination of the respective rights in and to the office, position, right, privilege or franchise of all the parties to the action as justice requires. Romualdez-Yap v CSC G.R. No. 104226 | August 12, 1993 | Padilla Facts: Petitioner Conchita Romualdez-Yap started working with the Philippine National Bank on 20 September 1972 as special assistant with the rank of Second Assistant Manager assigned to the office of the PNB President. After several promotions, she was appointed in 1983 Senior Vice President assigned to the Fund Transfer Department. Starting 1 April 1986 up to 20 February 1987, petitioner filed several applications for leave of absence (due to medical reasons) which were duly approved. While she was on leave, Executive Order No. 80 (Revised Charter of the PNB) was approved on 3 December 1986. Said executive order authorized the restructure/reorganization and rehabilitation of PNB. Pursuant to the reorganization plan, the Fund Transfer Department was abolished and its functions transferred to the International Department. Consequently, petitioner was notified of her separation from the service in a letter dated 30 January 1987. This letter was received by petitioner's secretary at the PNB head office on 16 February 1987.

Petitioner's first recorded appeal to the Civil Service Commission questioning her separation is a letter dated 4 August 1989, where then CSC Chairman Samilo N. Barlongay upheld the validity of her separation from the service. MR was also denied by the CSC through Resolution No. 92-201, dated 30 January, 1992 which ruled the reorganization of PNB was done in good faith. For indeed, the reorganization was pursued to achieve economy. It undertook reduction in force as a means to streamline the numbers of the workforce. It was incidental that movant Yap's position was one among those abolished. Movant Yap failed to substantiate her claim by clear and convincing evidence that the abolition of her position was a result of her close identification with the previous regime, being a sister of former First Lady Imelda Romualdez Marcos. On the issue of bad faith as related to the later restoration of the Fund Transfer Department, the subject CSC resolution adds that the re-established FTD is headed by a Vice President, a position much lower in rank than the former department headed by a Senior Vice President. Furthermore, CSC noted that granting arguendo that movant Yap's termination from the service was tainted with bad faith, she however, is now barred from assailing the same as she did not seasonably assert her right thereto. Records show that she was separated from PNB on February 16, 1987 and it was only in 1989 or about 2 years thereafter when she brought this matter to this Commission. By her inaction in questioning her termination within a period of one year, she is considered to have acquiesced to her separation from the service and abandoned her right to the position. Issues: 1. WON there was bad faith in the termination of petitioner as Senior Vice President Held: No. PNB's reorganization, to repeat, was by virtue of a valid law. At the time of reorganization, due to the critical financial situation of the bank, departments, positions and functions were abolished or merged. The abolition of the Fund Transfer Department (FTD) was deemed necessary. This, to the Court's mind, was a management prerogative exercised pursuant to a business judgment. At this point, a distinction can be made in ruling on the validity of a reorganization between a government bureau or office performing constituent functions (like the Customs) and a government-owned or controlled corporation performing ministrant functions (like the PNB). Whether there was a hidden political agenda to persecute petitioner due to her consanguinial relation to Mrs. Imelda Romualdez Marcos, the widow of former President Marcos, is not clearly shown. On the other hand, it is entirely possible that, precisely because of such consanguinial relation, petitioner may have been the object of deferential, if not special treatment under the Marcos regime. It is part of the Filipino culture to extend such deferential, if not special treatment to close relatives of persons in power. Many times this is carried to unwholesome extremes. But a

discontinuance of such deferential or special treatment in the wake of a change in government or administration is not bad faith per se. It may be merely putting things in their proper places. Due to the restructuring and this is empirically verifiable PNB became once more a viable banking institution. The restoration of the FTD four years after it was abolished and its functions transferred to the International Department, can be attributed to the bank's growth after reorganizations, thereby negating malice or bad faith in that reorganization. The essence of good faith lies in an honest belief in the validity of one's right. It consists of an honest intention to abstain from taking an unconscionable and unscrupulous advantage of another, its absence should be established by convincing evidence. The records also clearly indicate that starting April 1986 to February 1987, petitioner went on leave of absence for medical reasons. While she was not reporting to the office, the bank's reorganization got underway. She continued, however, receiving her salaries, allowances, emoluments, honoraria and fees up to March 1987. Employees who were affected by the reorganization had the option to avail of the bank's Separation Benefits Plan/Early Retirement Plan (SBP/ERIP). Petitioner opted not to avail of such plan and instead submitted to the result of the bank's ongoing reorganization and management's discretion. If petitioner had the desire for continued employment with the bank, she could have asserted it for management's consideration. There is no proof on record that she affirmatively expressed willingness to be employed. Since she cannot rebut the CSC finding that her earliest appeal was made on 4 August 1989, there is no reason for this Court to hold that she did not sleep on her rights. On the contrary, her present argument that bad faith existed at the time of the abolition of the FTD because it was restored four years later is a little too late. Who could have predicted in 1986 or 1987 that PNB would be able to rise from its financial crisis and become a viable commercial bank again? The decision to abolish the FTD at the time it was abolished, to repeat, was a business judgment made in good faith. In the first place, Rep. Act No. 6656 cannot be invoked by petitioner because it took effect on 15 June 1987, or after PNB's reorganization had already been implemented. But assuming, ex gratia argumenti, that it is applicable here and petitioner must be accorded preferential right to appointment in the bank, PNB in its rejoinder impressively asserts: Needless to say, there were various committees that were created in the implementation of the organizational restructuring of the Bank based on the foregoing policy guidelines. Each personnel to be retained was evaluated in terms of relative fitness and merit along with the other personnel of the Bank. Thus, when then SVP Federico Pascual was chosen to head the International Department from among other officers of the Bank, including Ms. Yap, his qualifications far exceeded those of the other candidates for the position. Qualifications of Mr. Pascual far exceed those of Petitioner Yap. Aside from being a lawyer having been a law

graduate from the University of the Philippines, he is also a Bachelor of Arts degree holder from Ateneo de Manila and a Master of Laws graduate o Columbia Law School. He had studied Masteral Arts in Public Administration at the London School of Economics and had undergone extensive seminars since 1974 at the International Department and had been assigned in several foreign branches of the Bank. Before he resigned from the Bank, he held the second highest position of Executive Vice President and served as Acting President of the Bank before the incumbent president, President Gabriel Singson assumed his position. On the other hand, the service record of Petitioner Yap will show that she only holds a Bachelor of Science in Commerce Degree from Assumption Convent and has undergone only one seminar on Management and Leadersbip Training Program. She entered the Bank service in 1972.

was due to the abolition of her office in implementation of a valid reorganization. This is not the unjustifiable cause which results in injury to the rights of a person contemplated by Article 1146. The abolition of the office was not a whimsical, thoughtless move. It was a thoroughly evaluated action for streamlining functions based on a rehabilitation plan. At the time of the abolition of the Fund Transfer Department in 1986, foreign exchange losses of the bank amounted to P81.1 Million. The head of office was a Senior Vice President. At the time of restoration of the department in 1991, it was headed by a vice president (lower in rank) and showed earnings of P2,620.0 Million. Other departments abolished in 1986 were also subsequently restored. Baybay Water District v Commission on Audit G.R. Nos. 147248-49 | January 23, 2002 | Mendoza Facts: In 1996, the Resident Auditor of the BWD conducted an audit of its 1994 accounts. In the course of the audit, the auditor disallowed payments of per diems in excess of those authorized by the Local Water Utilities Administration (LWUA) and P. D. No. 198, RATA (representation and transportation allowance) and rice allowances granted to the members of the board of directors of the BWD, as well as duplication of claims for cash gifts as part of the Christmas bonus of the general manager and traveling allowance of the officers of the BWD. The members of the board were served with notices of disallowance. Ma. Josette B. Astorga, to whom rice allowances had been given, and the other petitioners in this case were also served with similar notices. On May 30, 1997, petitioners asked for a reconsideration, but the Resident Auditor denied their request on the ground that the disallowance had become final and executory. Instead, she advised them to make their appeal to the Commission on Audit. The BWD at first appealed to the COA Regional Office No. VIII at Tacloban City, which affirmed the findings of the Resident Auditor of Baybay, Leyte, and then to the Commission on Audit. Issue: Whether members of the board of directors of water districts are entitled to receive benefits in addition to those authorized to be paid pursuant to their charter and the guidelines of the LWUA after the effectivity of R. A. No. 6758 ISSUE 1. WON members of the board of directors of water districts are entitled to receive benefits in addition to those authorized to be paid pursuant to their charter and the guidelines of the LWUA after the effectivity of R. A. No. 6758. Held: NO. Petitioners are not entitled to receive benefits and allowances in excess of those allowed by P.D. No. 198, the guidelines of the LWUA, and other applicable laws.

2.

WON Petitioner is entitled to immediate reinstatement to her former position as senior vice president and head of the Fund Transfer Department, or reappointment to a position of comparable or equivalent rank without loss of seniority rights and pay, etc., under the bank's new staffing pattern. (WON the Court did not err in applying the one year prescription period for quo warranto proceedings)

Held: No. Petitioner's action may be said to be one for quo warranto, seeking reinstatement to her former position which at present is occupied by another. Petitioner only insisted on reinstatement in August 1989 or two (2) years after her alleged unjustified separation. An action for quo warranto should be brought within one (1) year after ouster from office; the failure to institute the same within the reglementary period constitutes more than a sufficient basis for its dismissal since it is not proper that the title to a public office be subjected to continued uncertainty . . . An exception to this prescriptive period lies only if the failure to file the action can be attributed to the acts of a responsible government officer and not of the dismissed employee. Vigilantibus, non dormientibus, jura subveniunt (Laws come to the assistance of the vigilant, not of the sleeping). A person claiming to be entitled to a public office or position usurped or unlawfully held or exercised by another may bring an action for quo warranto (Rule 66, Sec. 6, Rules of Court). The petitioner therein must show a clear legal right to the office allegedly held unlawfully by another. Petitioner cannot invoke De Tavera v. Phil. Tuberculosis Society, Inc., et. al. 17 and contend that there is no claim of usurpation of office, and that quo warranto may be availed of to assert one's right to an office in the situation obtaining in the case at bar. Prescriptive period is not allegedly four (4) years in accordance with Article 1146 of the Civil Code, as petitioner would claim. Petitioner's separation from the service

P. D. No. 198, 13, as amended by P. D. No. 768 and P. D. No. 1479, reads: Compensation. Each director shall receive a per diem, to be determined by the board, for each meeting of the board actually attended by him, but no director shall receive per diems in any given month in excess of the equivalent of the total per diems of four meetings in any given month. No director shall receive other compensation for services to the district. Any per diem in excess of P50 shall be subject to approval of the Administration. In the same manner, under 32 of the National Internal Revenue Code, compensation includes fees, salaries, wages, commissions, and similar items for purposes of recognizing taxable income. The definitions of the term compensation in these statutes are for limited purposes only and cannot be deemed to comprehend such other purposes not specifically included in the provisions thereof. The members of the board of directors of water districts rights to compensation are governed by P. D. No. 198 13. Under 13, per diem is precisely intended to be the compensation of members of board of directors of water districts. By specifying the compensation which a director is entitled to receive and by limiting the amount he/she is allowed to receive in a month, and, in the same paragraph, providing No director shall receive other compensation than the amount provided for per diems, the law quite clearly indicates that directors of water districts are authorized to receive only the per diem authorized by law and no other compensation or allowance in whatever form. 2. WON the disallowance would impair vested rights, violate any rule against diminution of benefits, and undermine the management prerogative of water districts.

The fact that 12 and 17 of the Salary Standardization Law speak of allowances as benefits paid in addition to the salaries incumbents are presently receiving makes it clear that the law does not refer to the compensation of board of directors of water districts as these directors do not receive salaries but per diems for their compensation. Even the Local Water Utilities Administration (LWUA), in Resolution No. 313, s. 1995 on which petitioners rely for authority to grant themselves additional benefits, acknowledges that directors of water districts are not organic personnel and, as such, are deemed excluded from the coverage of the Salary Standardization Law. Petitioners contend that even before this Court declared in Davao City Water District v. Civil Service Commission that water districts are government-owned and controlled corporations subject to the jurisdiction of the COA, water districts had already been granting additional benefits to members of the board of directors, with the approval of the Local Water Utilities Administration (LWUA), and to their officers and employees and that they continued doing so after the promulgation of the decision in that case. Petitioners contend they have thus acquired a vested right to these benefits of which they cannot now be deprived without violating their property rights and the rule on non-diminution of benefits. This contention too has no merit. The erroneous application and enforcement of the law by public officers does not estop the Government from making a subsequent correction of such errors. More specifically, where there is an express provision of law prohibiting the grant of certain benefits, the law must be enforced even if it prejudices certain parties due to an error committed by public officials in granting the benefit. As already stated, P.D. No. 198 expressly prohibits the grant of compensation other than the payment of per diems, as determined by the LWUA pursuant to P. D. No. 198, to directors of water districts. Practice, no matter how long continued, cannot give rise to any vested right if it is contrary to law. Petitioners invoke management prerogative to justify the grant of allowances and other benefits to both the board of directors of BWD and its officers and employees. With respect to the board of directors, management prerogative refers to the right of an employer to regulate all aspects of employment, such as the freedom to prescribe work assignments, working methods, processes to be followed, regulation regarding transfer of employees, supervision of their work, lay-off and discipline, and dismissal and recall of work. Clearly, the existence of such right presupposes the existence of an employer-employee relationship. BWD board of directors are not employees of BWD. Their function, as defined by P. D. No. 198, is limited to policy-making, implying that their relationship to the water district is more fiduciary than that of employer-employee. Moreover, the right of directors of water districts to the payment of compensation is expressly provided for in P.D. No. 198, thus pre-empting the exercise of any discretion by the water districts.

Held: NO. Petitioners contend that the prohibition in P.D. No. 198, 13 against the grant of additional compensation to board members must be deemed repealed by virtue of 22[10] of R. A. No. 6758, otherwise known as the Salary Standardization Law. They contend that 13 of P.D. No. 198 is inconsistent with provisions of the Salary Standardization Law. R. A. No. 6758, 4 specifically provides that the Salary Standardization Law applies to positions, appointive or elective, on full or part-time basis, now existing or hereafter created in the government, including government-owned or controlled corporations and government financial institutions. The Salary Standardization Law does not apply to petitioners because directors of water districts are in fact limited to policy-making and are prohibited from the management of the districts. P.D. No. 198, 18 described the functions of members of boards of directors of water districts as follows: Sec. 18. Functions Limited to Policy-Making. The function of the board shall be to establish policy. The Board shall not engage in the detailed management of the district.

With respect to the officers and employees of BWD, it has been held that the terms and conditions of employment of government employees are governed by law. Thus, the exercise of management prerogative by government corporations is limited by the provisions of the laws applicable to them. The cash gift granted to the general manager as part of his Christmas bonus was in excess of that authorized by R. A. No. 6686. It cannot be justified by the exercise of management prerogative as it is contrary to law. Finally, the disallowance of the duplication of claims for transportation allowance does not fall under management prerogative as this does not pertain to the power of management to determine the terms and conditions of employment but pertains to whether or not the claims are properly accounted for. Rodrigo v Sandiganbayan G.R. No. 125498 | February 18, 1999 | Kapunan Facts: Conrado B. Rodrigo and Reynaldo G. Mejica are the Mayor and Municipal Planning and Development Coordinator, respectivley, of San Nicolas, Pangasinan, while petitioner Alejandro A. Facundo is the former Municipal Treasurer of the same municipality. The Muicipality of San Nicolas, represented by Mayor Rodrigo, entered into an agreement with Philwood Construction, represented by Larry Lu, for the electrification of Barangay Cabolan, San Nicolas, for the sum of P486, 386.18. Mejica, the Planning and Development Coordinator of San Nicolas, prepared an Accomplishment Report stating that the Caboloan Power Generation project was 97.5% accomplished. Said report was supposedly approved by mayor Rodrigo and confirmed by Larry Lu. On the basis of said report, payment of P452, 825.53 was effected by the Municipal Treasurer, petitioner Facundo, to Philwood Construction. Petitioners received a Notice of Disallowance dated 21 June 1993 from the Provincial Auditor of Pangasinan, Atty. Agustin Chan, Jr., who found that as per COA (Commission on Audit) evaluation of the electrification project, only 60.0171% of the project (equivalent to P291, 915.07) was actually accomplished. The Provincial Auditor thus disallowed the amount of P160, 910.46. Petitioners requested the Provincial Auditor to lift the notice of disallowance and to re-inspect the project. The Provincial Auditor, however, allegedly did not act on petitioners' requests. Provincial Auditor filed a criminal complaint for estafa before the Ombudsman against petitioners. Likewise impleaded were Larry Lu and Ramil Ang, President and General Manager, and Project Engineer, respectively, of Philwood Construction. Acting Ombudsman Francisco Villa approved the filing of an information against petitioners for violation of Section 3 (e) of Republic Act No. 30196 [The Anti-Graft and Corrupt Practices Act.] before the Sandiganbayan. Petitioners filed a motion for reinvestigation before the Sandiganbayan. The Sandiganbayan granted said motion.

Office of the Special Prosecutor issued a memorandum recommending that the charges against petitioners be maintained. The Ombudsman approved said memorandum. Petitioners thereafter filed before the Sandiganbayan a motion to quash the information. They instead faulted the Provincial Auditor for instituting the complaint against them notwithstanding the pendency of their opposition to the notice of disallowance. The Sandiganbayan denied said motion. The prosecution moved to suspend petitioners pendente lite. Petitioners opposed the motion on the ground that the Sandiganbayan lacked jurisdiction over them. In a Resolution, the Sandiganbayan ruled that it had jurisdiction over the petitioners and ordered the suspension of petitioners and ordered the suspension of petitioners pendente lite. Petitioners thus filed before this Court the instant petition for certiorari under Rule 65. Issue: WON Mayors, despite the low compensation they are receiving, are within the jurisdiction of the SB. Held: YES. With the advent of the new Constitution, and in compliance with Section 5, Article IX-C, Congress enacted R.A. No. 6758. Section 2 thereof declares it the policy of the State to provide equal pay for substantially equal work and to base differences in pay upon substantive differences in duties and responsibilities, and qualification requirements of the positions. To give life to this policy, as well as the constitutional prescription to (take) into account the nature of the responsibilities pertaining to, and the qualifications required for the positions of government officials and employees, Congress adopted the scheme employed in P.D. No. 985 for classifying positions with comparable responsibilities and qualifications for the purpose of according su ch positions similar salaries. This scheme is known as the Grade which as defined in PD 985 includes all classes of positions which, although different with respect to kind or subject matter of work, are sufficiently equivalent as to level of difficulty and responsibilities and level of qualification requirements of the work to warrant the inclusion of such classes of positions within one range of basic compensation. The Grade is therefore a means of grouping positions sufficiently equivalent as to level of difficulty and responsibilities and level of qualification requirements of the work so that they may be lumped together in one range of basic compensation. Congress delegated the rest of this tedious task (of fixing Salary Grades) to the DBM, subject to the standards contained in R.A. No. 6758, by authorizing the DBM to determine the officials who are of equivalent rank to the foregoing officials, where applicable, and to assign them the same Salary Grades subject to a set of guidelines found in said section. For positions below those mentioned

under Section 8, Section 9 directs the DBM to prepare the Index of Occupational Services guided by (a) the Benchmark Position prescribed in Section 9, and (b) the following factors: (1) the education and experience required to perform the duties and responsibilities of the position; (2) nature and complexity of the work to be performed; the kind of supervision received; (4) mental and/or physical strain required in the completion of the work; (5) nature and extent of internal and external relationships; (6) kind of supervision exercised; (7) decision-making responsibility; (8) responsibility for accuracy of records and reports; (9) accountability for funds, properties and equipment; and (10) hardship, hazard and personal risk involved in the job. Pursuant to such authority, the DBM drafted the 1989 Index of Occupational Services, Position Titles and Salary Grades, later revised in 1997. In both versions, the position of Municipal Mayor was assigned a Salary Grade 27. That petitioner received a salary less than that prescribed for such Grade is explained by Sections 10 and 19 (b) of R.A. No. 6758. A local government officials actual salary may be less than what the Salary Schedule under Section 7 prescribes, depending on the class and financial capability of his or her respective local government unit. This circumstance, however, has no bearing on such officials Grade. As the foregoing discussion shows, on officials salary is determined by the Grade accorded his position, and ultimately by the nature of his position the level of difficulty and responsibilities and level of qualification requirements of the work. To give credence to petitioners argument that Mayor Rodrigos salary determines his Grade would be to misconstrue the provisions of R.A. No. 6758, and ignore the constitutional and statutory policies behind said law. Tejada v Domingo G. R. No. 91860 | January 13, 1992 | Davide, Jr. Facts: Petitioners Roseo U. Tejada and Radito C. Ching are senior clerks of the COA assigned to the auditing units of the Philippine National Bank (PNB) and the Central Bank (CB), respectively. Before the effectivity of R.A. No. 6758, Tejada's gross monthly compensation was P3,673.20 while Ching's was only P3,134.00. Of the foregoing, only the basic salary and the cost of living allowance, in the total sum of P2,323.00, were due each of them as senior clerks in the COA. The other benefits were voluntarily given to them by the PNB and the CB, respectively. Prior to the enactment of Presidential Decree No. 1445, otherwise known as the Government Auditing Code of the Philippines, all officials and employees of the COA, like herein petitioners, assigned to, inter alia, government-owned or controlled corporations (GOCCs), received their salaries, allowances, additional compensation, emoluments and other fringe benefits directly from such GOCCs. This practice was not deemed effective enough to enhance the independence and protect the integrity of the COA.

Thus, with the end in view of insulating these COA officials and employees, particularly the auditors, from unwarranted influence, thereby preserving the independence and integrity of the COA, Presidential Decree No. 1445 expressly mandates that the salaries and other forms of compensation of the personnel of the COA shall follow a common position classification and compensation plan regardless of agency assignment and shall be subject to P.D. No. 985; and that all officials and employees thereof, including its representatives and support personnel, shall be paid their salaries, emoluments and allowances directly by the COA out of the latter's appropriations and contributions, which shall be considered as part of its operating expenses to be included in the annual appropriations law, but funded from the assessments made upon, or from contributions of the GOCCs. It directed GOCCs to appropriate in their respective budgets and remit to the National Treasury an amount at least equivalent to the appropriation for the salaries and allowances of the representatives and staff of the Commission during the preceding fiscal year. The requirement of a common position and compensation plan did away with the old practice of agencies concerned determining the number, compensation and assignment of COA representatives, which was both chaotic and unjust. The provision on direct payment by COA of the salaries and other benefits was designed to instill institution loyalty. This policy was further strengthened by Executive Order No. 19 which President Corazon C. Aquino enacted on 19 June 1986. Sections 2 and 3 thereof provide: Sec. 2. (as amended by E.O. No. 271). The cost of audit services rendered to government agencies by the Commission on Audit shall be covered by the fund sources provided in Sec. 24 of Presidential Decree No. 1445 which shall be incorporated in the national government budget and included in the Annual General Appropriations Law: provided, that in the case of government-owned and/or controlled corporations and its subsidiaries, the cost of audit services shall be based on the actual cost of the audit function in the corporation concerned, plus a reasonable rate to cover overhead expenses. The actual audit cost shall include personal services, maintenance and other operating expenses, depreciation on capital and equipment and out-of-pocket expenses. Thus, the law is clear that the contributions from the GOCCs are limited to the cost of audit services which are based on the actual cost of the audit function in the corporation concerned plus a reasonable rate to cover overhead expenses. The actual audit cost shall include personnel services, maintenance and other operating expenses, depreciation on capital and equipment and out-of-pocket expenses. In respect to the allowances and fringe benefits granted by the GOCCs to the COA personnel assigned to the former's auditing units, the same shall be directly defrayed by COA from its own appropriations pursuant to Section 31 of the General Provisions of the General Appropriations Act, otherwise known as Batas Pambansa Bilang 879. Then came R.A. No. 6758. Section 18 of Republic Act No. 6758, otherwise known as the Compensation and Position Classification Act of 1989, provides that in order

to preserve the independence and integrity of the Commission on Audit (COA), its officials and employees are prohibited from receiving salaries, honoraria, bonuses, allowances or other emoluments from any government entity, local government unit, and government-owned and controlled corporations, and government financial institutions, except those compensation paid directly by the COA out of its appropriations and contributions. The questioned interpretation and implementation are contained in the memorandum of the respondent dated 24 August 1989, the pertinent portion of which reads: . . . Thus effective July 1, 1989, the salaries, allowances and other emoluments to be received by COA officials and employees, regardless of station or assignment, are only those that are paid directly by COA out of its own appropriations and contributions. Henceforth, the continued payment by any other government entity, whether in the national, local or corporate sector, to any COA official or employee of such compensation, including those incorporated in the computerized payroll, would no longer have legal basis. Accordingly, in order not to delay the processing of the salary payroll of all COA officials and employees for September, 1989, all such additional emoluments will be deleted in the computation of the said payroll. As a consequence, each of the petitioners presently receive the reduced salary of P2,323.00. Issue: Whether or not under R.A. No. 6758 COA personnel may still be allowed to receive from any government agency, local or national, including government-owned or controlled corporations and government financing institutions, other allowances, emoluments and fringe benefits over and above their legally set salaries and allowances as COA employees. Held: No. Tejada and Ching cannot legally and validly receive such extra benefits from the PNB and the CB, respectively, because not only are they not organic personnel thereof, but also because of the express prohibition of Section 18 of R.A. No. 6758. There can be no question that Section 18 of Republic Act No. 6758 is designed to strengthen further the policy, earlier mandated by the Government Auditing Code of the Philippines and then by Executive Order No. 19 (as amended by Executive Order No. 271), to preserve the independence and integrity of the COA, by explicitly PROHIBITING: (1) COA officials and employees from receiving salaries, honoraria, bonuses, allowances or other emoluments from any government entity, local government unit, GOCCs and government financial institutions, except such compensation paid directly by the COA out of its appropriations and contributions, and (2) government entities, including GOCCS, government financial institutions and local government units from assessing or billing other government entities, GOCCs, government financial institutions or local government units for services rendered by the latter's officials and employees as part of their regular

functions for purposes of paying additional compensation to said official and employees.

Petitioners assume that their gross compensation includes the extra emoluments given by the GOCCs to which they are assigned, that Sections 12 and 17 of the Act grant them vested rights to such extra emoluments and that they were directly paid by the COA out of its appropriations and contributions. While Section 18 of Republic Act No. 6758 uses the word "prohibited," Section 22 of P.D. No. 1445 does not. No one may successfully argue against the proposition that a total removal of the temptation and enticement the extra emoluments provide would be one effective way to vigorously and aggressively enforce the Constitutional provision mandating the COA to prevent or disallow irregular, unnecessary, excessive, extravagant, or unconscionable expenditures, or uses of government funds and properties. The COA personnel assigned to the GOCCs who have absolutely nothing to look forward to or expect from the latter in terms of extra benefits would have no reason to accord special treatment to the GOCCs by closing their eyes to irregular or unlawful expenditures or use of funds or property, or conducting perfunctory audit. The law realizes that such extra benefits could diminish the personnel's seriousness and dedication in the pursuit of their assigned tasks, affect their impartiality and provide a continuing temptation to ingratiate themselves to the GOCCs or government financial institutions concerned. In the end then, they would become ineffective auditors. Upon the other hand, as correctly contended by the respondent, Memorandum Order No. 177 rationalizing the compensation structure in GOCCs and government financial institutions, issued by the President on 31 May 1988, limits the grant of extra allowances and fringe benefits to their officials and employees. Section 2 thereof reads: Sec. 2. Allowances of incumbents. Incumbents of positions in corporate entities covered by the Memorandom Order who are presently receiving additional monthly compensation/fringe benefits and other emoluments which were continuously enjoyed for a period of at least 12 months prior to the effectivity of this Order, including those authorized solely by their governing boards effected on or before December 31, 1987, the aggregate of which exceeds the standardized rates prescribed pursuant to existing laws, rules and regulations and ministered by the Department of Budget and Management, shall continue to receive such excess allowances, which shall be referred to as "transition allowance." The "transition allowance" shall be correspondingly reduced by the amount of any salary increase or salary adjustment that the incumbent shall receive in the future. The additional compensation, fringe benefits and other emoluments which may be considered as "transition allowance" under this Memorandum Order shall be limited to those which are of common or general application to all the personnel of the entities covered under Section 1 hereof.

The Corporate Budget Circular No. 15 issued by the Secretary of the Department of Budget and Management on 5 July 1988, to implement the aforesaid Memorandum Order, pertinently provides for the coverage and exemption thereof. It is explicitly provided that members of the governing boards of any government-owned or controlled corporation and financial institution, detailed personnel from other government agencies/corporations including personnel of the Commission on Audit (COA) and Civil Service Commission (CSC) are not covered by the provisions of said Order. The foregoing legislative and executive pronouncements unerringly reveal a twopronged strategy to preserve and enhance the independence and integrity of the COA and make its personnel loyal to none other except that institution and beholden to nobody but the people whose coffers they must guard with dedication and responsibility. The first aspect of the strategy is directed to the COA itself, while the second aspect is addressed directly against the GOCCs and government financial institutions. Under the first, COA personnel assigned to auditing units of GOCCs or government financial institutions can receive only such salaries, allowances or fringe benefits paid directly by the COA out of its appropriations and contributions. The contributions referred to are the cost of audit services earlier mentioned which cannot include the extra emoluments or benefits now claimed by petitioners. The COA is further barred from assessing or billing GOCCs and government financial institutions for services rendered by its personnel as part of their regular audit functions for purposes of paying additional compensation to such personnel. Under the second, GOCCs and government financial institutions can no longer rely on Section 2 of P.D. No. 985; moreover, fringe benefits and other emoluments in excess of the standardized rates, which may be continued to be received in the concept of "transition allowance" under Memorandum Order No. 177, in relation to Corporate Budget Circular No. 15 (15 July 1988), apply only to the officials and employees of profit-making and financially viable GOCCs and government financial institutions. It goes without saying then that the PNB and the CB cannot legally and validly continue to grant Tejada and Ching, respectively, the extra emoluments in question because these could only be given to its officials, employees or organic personnel, subject to Memorandum Order No. 177 and Corporate Budget Circular No. 15. Otherwise stated, Tejada and Ching cannot legally and validly receive such extra benefits from the PNB and the CB, respectively, because not only are they not organic personnel thereof, but also because of the express prohibition of Section 18 of R.A. No. 6758. Petitioners' contention that Sections 12 and 17 of R.A. No. 6758 authorize their continued receipt of the extra allowances from the GOCCs to which they are assigned are patently untenable. Section 12 refers to the regular allowances and compensation which an instrumentality, entity or agency of the government grants to its organic personnel. In the case of COA personnel, such allowances and

compensation cannot include allowances, fringe benefits or extra emoluments, such as those claimed by petitioners, which are granted by GOCCs or government financial institutions because Section 18 of the Act itself bans the COA personnel from receiving them even as it also prohibits GOCCs and government financial institutions from granting such benefits to personnel of other government instrumentalities, entities or agencies assigned to them to perform the regular functions of their mother units. There is no indication at all that R.A. No. 6758 has jettisoned the first aspect of the policy. On the contrary, it has strengthened it. It would have been absurd and illogical for the law to impose the prohibition and at the same time mandate its integration in the standardized salary rates of the personnel of the COA. In the second place, the Secretary of the DBM, Hon. Guillermo Carague, has certified that "other than those authorized/mandated by law, the allowances, fringe benefits and other emoluments that were directly received by COA personnel from the various government owned and controlled corporations, including government financial institutions, to which they are assigned, were not provided under the regular appropriations of the Commission in the General Appropriations Act of 1989 and 1990." 21 They were not so provided because, as discussed above, there was no legal basis therefor. The additional compensation or fringe benefits and other emoluments referred to therein are those granted by the mother or parent unit to the incumbents thereof, i.e., the organic personnel, which include benefits absorbed from local government units. As correctly observed by respondent, the law does not mention benefits absorbed from GOCCs or government financial institutions. This is so because no such benefit was intended to be absorbed. On the contrary, GOCCs and government financial institutions were prohibited from granting them to non-organic personnel. Petitioners, nevertheless, posit the view that since, in respect to GOCCs and government financial institutions, the law does not seem to make a distinction between an incumbent therein who is an organic personnel thereof and an incumbent who is a COA personnel assigned to their auditing units, petitioners must, for purposes of Section 17, be considered "incumbents" of the PNB and the CB. They appeal to the rule on statutory construction that where the law does not make any distinction, no distinction should be made. A distinction is not in order for the meaning of incumbent is not doubtful nor susceptible of more than one interpretatioin. An incumbent is a person who is in present possession of an office; one who is legally authorized to discharge the duties of an office. An office is a public charge or employment, an employment on behalf of the government in any station or public trust, not merely transient, occasional or incidental. An incumbent then can only refer to the holder of an office either by appointment or by election. Insofar as petitioners were concerned, they are incumbents of the position to which they have been appointed senior clerks of the COA and not of the PNB or the CB to which they are merely temporarily assigned.

Separate Opinion, Guttierez: When a clerk joins the government service, he does so on the basis of the total compensation package regularly given for a fairly long period to occupants of that position. Unlike the chief or assistant chief auditor, he does not expect to be shifted from agency to agency. In theory a clerk joins the COA as a national office but in actuality he joins the COA Supreme Court, COA Philippine National Bank, COA Bureau of Prisons, etc. To suddenly reduce the take home pay which has been received for many years is cruel and unnecessary. If standardization of incomes of all clerks in all government offices is to be effected no matter how different the workloads, the confidentiality or sensitivity of functions, the complexity and magnitutde of assignments, and the amounts of funds and properties being checked by the office, some kind of transition arrangement to equal the lost income must be provided by the Commission itself, at the very least. Santos v CA G.R. No. 139792 | November 22, 2000 | Davide, Jr. Facts: On 18 January 1983, petitioner was appointed Judge of the MeTC of Quezon City, and he thereafter assumed office. After the military-backed EDSA revolt, petitioner was reappointed to the same position. On 1 April 1992, petitioner optionally retired from the Judiciary under R.A. No. 910, as amended, and received his retirement gratuity under the law for his entire years in the government service; and five years thereafter he has been regularly receiving a monthly pension. On 2 December 1993, petitioner re-entered the government service. He was appointed Director III of the Traffic Operation Center of the MMA. His appointment was approved by the Civil Service Commission (CSC). On 1 March 1995, Congress enacted R.A. No. 7924, which reorganized the MMA and renamed it as Metropolitan Manila Development Authority (MMDA). On 16 May 1996, the President of the Philippines issued Memorandum Order No. 372 approving the Rules and Regulations Implementing R.A. No. 7924. Pursuant thereto, the MMDA issued Resolution No. 16, series of 1996, which, inter alia, authorized the payment of separation benefits to the officials and employees of the former MMA who would be separated as a result of the implementation of R.A. No. 7924. On 30 August 1996, the MMDA issued a Memorandum to petitioner informing him that in view of his voluntary option to be separated from the service his services would automatically cease effective at the close of office hours on 15 September 1996, and that he would be entitled to separation benefits equivalent to one and onefourth (1) monthly salary for every year of service as provided under Section 11 of the MMDA Law. In view of some doubt or confusion as to the extent of his separation benefits, petitioner submitted a Position Paper wherein he asserted that since the retirement gratuity he received under R.A. No. 910, as amended, is not an additional or double

compensation, all the years of his government service, including those years in the Judiciary, should be credited in the computation of his separation benefits under R.A. No. 7924. The Assistant Manager for Finance of the MMDA referred the Position Paper to the Regional Office of the CSC-NCR.

Civil Service Resolution held that while an employee who was paid separation/retirement benefits is not required to refund the same once reemployed in the government service, as aforestated, for reasons of equity however, it would be proper and logical that said separation/retirement benefits should nevertheless be deducted from the retirement/separation pay to be received by the employee concerned. Moreover, in this instance, the employee concerned has the option either to refund his separation/retirement benefits and claim his gross retirement/separation pay without any deduction corresponding to his separation pay received, or not [to] refund his separation/retirement pay but suffer a deduction of his retirement/separation gratuity for the total amount representing his previous separation/retirement pay received. On 21 October 1997, the CSC promulgated Resolution No. 97-4266 affirming the opinion of Director Acebedo and dismissing petitioners appeal. Citing Chaves v. Mathay, it held that petitioner cannot be paid retirement benefits twice one under R.A. No. 910, as amended, and another under R.A. No. 7924 for the same services he rendered as MeTC Judge. He can only exercise one of two options in the computation of his separation pay under R.A. 7924. These options are (1) to refund the gratuity he received under R.A. No. 910, as amended, after he retired from the MeTC and get the full separation pay for his entire years in the government, that is 9 years and 2 months with the MeTC plus two (2) years and eight (8) months for his services as Director III in the defunct MMA, at the rate of one and one-fourth salary for every year of service pursuant to MMDA Memorandum dated 30 August 1996; or (2) to retain the gratuity pay he received for his services as MeTC Judge but an equivalent amount shall be deducted from the separation benefits due from the former MMA for his entire government service. CA held that CSC was correct in dismissing petitioners appeal from the opinion of Director Acebedo. It ratiocinated as follows: There is no specific rule of law which applies to petitioners case. Nevertheless, the Court finds it equitable to deny his claim for payment of separation pay at the rate of one and one-fourth (1) months salary for every year of his service in government, that is, inclusive of the number of years he served as Judge of the Metropolitan Trial Court of Manila [sic]. Petitioner already received and is continually receiving gratuity for his years of service as a Metropolitan Trial Court Judge. Equity dictates that he should no longer be allowed to receive further gratuity for said years of service in the guise of separation pay. Issue: WON Director Acebedos claim for payment of separation spay for every year of service should include the number of years he served as Judge of the MeTC

Held: No. Section 11 of R.A. No. 7924 does not allow the tacking in of his previous government service. To credit his years of service in the Judiciary in the computation of his separation pay under R.A. No. 7924 notwithstanding the fact that he had received or has been receiving the retirement benefits under R.A. No. 910, as amended, would be to countenance double compensation for exactly the same services, i.e., his services as MeTC Judge. Such would run counter to the policy of this Court against double compensation for exactly the same services. More important, it would be in violation of the first paragraph of Section 8 of Article IX-B of the Constitution, which proscribes additional, double, or indirect compensation. The case at bench is not, strictly speaking, about double pension. It is, however, about the interpretation of a gratuity law, viz., Section 11 of Republic Act No. 7924 which awards separation pay to those government employees who were displaced by the reorganization of the MMA into the MMDA, which should be construed to preclude a government employee from receiving double gratuity for the same years of service. In the first place, the last paragraph of Section 11 of R.A. No. 7924 on the grant of separation pay at the rate of one and one-fourth (1) months of salary for every year of service cannot by any stretch of logic or imagination be interpreted to refer to the total length of service of an MMA employee in the government, i.e., to include such service in the government outside the MMA. Since it allows the grant of separation pay to employees who were to be displaced thereby the separation pay can be based only on the length of service in the MMA. The displacement amounted to an abolition of the office or position of the displaced employees, such as that of petitioner. The rule is settled that Congress may abolish public offices. Such a power is a consequent prerogative of its power to create public offices. However, the power to abolish is subject to the condition that it be exercised in good faith. The separation partook of the nature of a disturbance of compensation; hence, the separation pay must relate only to the employment thus affected. Second, petitioner himself must have realized that Section 11 does not allow the tacking in of his previous government service. If he were convinced that it does he could have instead applied for retirement benefits, since by adding his years of service in the MMA to his previous years of service in the Government he could have retired under the third paragraph of Section 11, which pertinently reads: Provided, that, if qualified for retirement under existing retirement laws, said employee may opt to receive the benefits thereunder. Third, after the approval of his optional retirement on 1 April 1992, petitioner was fully paid of his retirement gratuity under R.A. No. 910, as amended; and five years thereafter he has been receiving a monthly pension. The petitioner cannot take refuge under the second paragraph of Section 8 of Article IX-B of the Constitution, which provides that pensions or gratuities shall not be considered as additional, double, or indirect compensation. This provision simply means that a retiree receiving pension or gratuity can continue to receive such

pension or gratuity even if he accepts another government position to which another compensation is attached. Indeed, the retirement benefits which petitioner had received or has been receiving under R.A. No. 910, as amended, do not constitute double compensation. He could continue receiving the same even if after his retirement he had been receiving salary from the defunct MMA as Director III thereof. This is but just because said retirement benefits are rewards for his services as MeTC Judge, while his salary was his compensation for his services as Director III of the MMA. However, to credit his years of service in the Judiciary in the computation of his separation pay under R.A. No. 7924 notwithstanding the fact that he had received or has been receiving the retirement benefits under R.A. No. 910, as amended, would be to countenance double compensation for exactly the same services, i.e., his services as MeTC Judge. Such would run counter to the policy of this Court against double compensation for exactly the same services. More important, it would be in violation of the first paragraph of Section 8 of Article IX-B of the Constitution, which proscribes additional, double, or indirect compensation. Said provision reads: No elective or appointive public officer or employee shall receive additional, double, or indirect compensation, unless specifically authorized by law . Section 11 of R.A. No. 7924 does not specifically authorize payment of additional compensation for years of government service outside of the MMA.