Constitutional Law 1 Chapter 10: The Executive Department, and Chapter 11: Powers of the President E !

!" C o% 1'()*+% ,arch 1+, +00'7?8 7a8 otice of Disallowance o% *<=00<=101 7*>8 dated 1ul9 )1, 1**< for the total sum of P+',>00 coverin: the period of 1ul9=Decem?er 1**>F otice of Disallowance o% *<=00)=101 7*58 also dated 1ul9 )1, 1**< for a total amount of P100,000 coverin: the period of 1anuar9 1**5 to 1anuar9 1**(F otice of Disallowance o% *<=01(=101 7*(8 dated /cto?er *, 1**< for the total amount of P+10,000 coverin: the period of 3e?ruar9 1**( to 1anuar9 1**<%

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!E ED.CT/ E& E0T/ &% BITONIO, 1&%, petitioner, vs% COMMISSION ON AUDIT and CEL0/ D% $" $" , C2".&," /3 T2E C/,,.00./ / "4D.T, respondents% DEC.0./ C"LLE1/, 0&%, J%: The instant petition filed under &ule 5' of the &evised &ules of Court see6s the annulment of the Decision of the Commission on "udit 7C/"8 dated 1anuar9 )0, +001 den9in: the petitioner;s motion for the reconsideration of the C/" otices of Disallowance os% *<=00<=101 7*>8 and *<=01(=101 7*(8 dated 1ul9 )1, 1**< and /cto?er *, 1**<, respectivel9, involvin: the per diems the petitioner received from the Philippine Economic @one "uthorit9 7PE@"8% .n order to avoid multiplicit9 of suits, an "mended Petition dated "u:ust 15, +00+ was later filed to include in the resolution of the instant petition otice of Disallowance o% *<=00)=101 7*58 dated 1ul9 )1, 1**< which was ?elatedl9 received ?9 the petitioner on "u:ust 1), +00+% The antecedent facts are as follows: .n 1**', petitioner !enedicto Ernesto &% !itonio, 1r% was appointed Director .A of the !ureau of La?or &elations in the Department of La?or and Emplo9ment% .n a Letter dated ,a9 11, 1**> addressed to 2onora?le &iBalino 0% avarro, then 0ecretar9 of the Department of Trade and .ndustr9, "ctin: 0ecretar9 1ose 0% !rilliantes of the Department of La?or and Emplo9ment desi:nated the petitioner to ?e the D/LE representative to the !oard of Directors of PE@"% 0uch desi:nation was in pursuance to 0ection 11 of &epu?lic "ct o% (*15, otherwise 6nown as the 0pecial Economic @one "ct of 1**>, which provides: 0ection 11% The Philippine Economic @one "uthorit9 7PE@"8 !oard% There is here?9 created a ?od9 corporate to ?e 6nown as the Philippine Economic @one "uthorit9 7PE@"8C C The !oard shall ?e composed of the Director $eneral as ex officio chairman with ei:ht 7<8 mem?ers as follows: the Secretaries or their representatives of the Department of Trade and .ndustr9, the Department of 3inance, the Department of La?or and Emplo9ment, the Department of #the- .nterior and Local $overnment, the ational Economic and Development "uthorit9, and the Bangko Sentral ng Pilipinas, one 718 representative from the la?or sector, and one 718 representative from the investorD?usiness sector in the EC/@/ E% C ,em?ers of the !oard shall receive a per diem of not less than the amount eEuivalent to the representation and transportation allowances of the mem?ers of the !oard andDor as ma9 ?e determined ?9 the Department of !ud:et and ,ana:ement: Provided, however, That the per diem collected per month does not exceed the eEuivalent of four 7'8 meetin:s% "s representative of the 0ecretar9 of La?or to the PE@", the petitioner was receivin: a per diem for ever9 ?oard meetin: he attended durin: the 9ears 1**> to 1**(% "fter a post audit of the PE@";s dis?ursement transactions, the C/" disallowed the pa9ment of per diems to the petitioner and thus issued the followin::

7c8

The uniform reason for the disallowance was stated in the otices, as follows: Ca?inet mem?ers, their deputies and assistants holdin: other offices in addition to their primar9 office and to receive compensation therefore was declared unconstitutional ?9 the 0upreme Court in the Civil Li?erties 4nion vs% Executive 0ecretar9% Disallowance is in pursuance to C/" ,emorandum o% *(=0)< dated 0eptem?er 1*, 1**( implementin: 0enate Committee &eport o% >0*% /n ovem?er +', 1**<, the petitioner filed his motion for reconsideration to the C/" on the followin: :rounds: 1% The 0upreme Court in its &esolution dated "u:ust +, 1**1 on the motion for clarification filed ?9 the 0olicitor $eneral modified its earlier rulin: in the Civil Liberties Union case which limits the prohi?ition to Ca?inet 0ecretaries, 4ndersecretaries and their "ssistants% /fficials :iven the ran6 eEuivalent to a 0ecretar9, 4ndersecretar9 or "ssistant 0ecretar9 and other appointive officials ?elow the ran6 of "ssistant 0ecretar9 are not covered ?9 the prohi?ition% 0ection 11 of &%"% o% (*15 provides the le:al ?asis for the movant to receive per diem% 0aid law was enacted in 1**>, four 9ears after the Civil Liberties Union case ?ecame final% .n expressl9 authoriBin: per diems, Con:ress should ?e conclusivel9 presumed to have ?een aware of the parameters of the constitutional prohi?ition as interpreted in the Civil Liberties Union case%

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/n 1anuar9 )0, +001, the C/" rendered the assailed decision den9in: petitioner;s motion for reconsideration% 2ence, this petition% The issue in this case is whether or not the C/" correctl9 disallowed the per diems received ?9 the petitioner for his attendance in the PE@" !oard of Directors; meetin:s as representative of the 0ecretar9 of La?or% Ge rule in the affirmative% The C/" anchors the disallowance of per diems in the case of Civil Liberties Union v. xec!tive Secretar" where the Court declared Executive /rder o% +<' allowin: :overnment officials to hold multiple positions in :overnment, unconstitutional% Thus, Ca?inet 0ecretaries, 4ndersecretaries, and their "ssistant 0ecretaries, are prohi?ited to hold other :overnment offices or positions in addition to their primar9 positions and to receive compensation therefor, except in cases where the Constitution expressl9 provides% The Court;s rulin: was in conformit9 with 0ection 1), "rticle A.. of the 1*<( Constitution which reads: 0ec% 1)% The President, Aice=President, the ,em?ers of the Ca?inet, and their deputies or assistants shall not, unless otherwise provided in this Constitution, hold an9 other office

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Constitutional Law 1 Chapter 10: The Executive Department, and Chapter 11: Powers of the President or emplo9ment durin: their tenure% The9 shall not, durin: their tenure, directl9 or indirectl9, practice an9 other profession, participate in an9 ?usiness or ?e financiall9 interested in an9 other contract with, or in an9 franchise, or special privile:e :ranted ?9 the $overnment or an9 su?division, a:enc9 or instrumentalit9 thereof, includin: an9 :overnment=owned or controlled corporations or their su?sidiaries% The9 shall strictl9 avoid conflict of interest in the conduct of their office% The spouse and relatives ?9 consan:uinit9 or affinit9 within the fourth civil de:ree of the President shall not, durin: his tenure, ?e appointed as mem?ers of the Constitutional Commissions, or the /ffice of the /m?udsman, or as 0ecretaries, 4ndersecretaries, Chairmen, or heads of ?ureaus or offices, includin: :overnment=owned or controlled corporations and su?sidiaries% Pursuant to the Court;s rulin: in this case and the 0enate Committee &eport on the "ccounta?ilit9 of Pu?lic /fficers and .nvesti:ations 7!lue &i??on8, the C/" issued ,emorandum o% *(=0)< which authoriBed the issuance of the otices of Disallowances for the per diems received ?9 the petitioner% .t states: The Commission received a cop9 of 0enate Committee &eport o% >0* ur:in: Hthe Commission on "udit to immediatel9 cause the disallowance of an9 pa9ment of an9 form of additional compensation or remuneration to ca?inet secretaries, their deputies and assistants, or their representatives in violation of the rule on multiple positions and to effect the refund of an9 and all such additional compensation :iven to and received ?9 the officials concerned, or their representatives, from the time of the finalit9 of the 0upreme Court rulin: in Civil Li?erties 4nion vs% Executive 0ecretar9 to the present%I .n the Civil Li?erties 4nion case, the 0upreme Court ruled that Ca?inet 0ecretaries, their deputies and assistants ma9 not hold an9 other office or emplo9ment% .t declared Executive /rder o% +<' unconstitutional insofar as it allows Ca?inet mem?ers, their deputies and assistants to hold other offices in addition to their primar9 office and to receive compensation therefor% The said decision ?ecame final and executor9 on "u:ust 1*, 1**1% .n view thereof, all unit headsDauditorsDteam leaders of the national :overnment a:encies and :overnment=owned or controlled corporations which have effected pa9ment of su?Ject allowances are directed to implement the recommendation contained in the su?Ject 0enate Committee &eport ?9 underta6in: the followin: audit action: C The petitioner maintains that he is entitled to the pa9ment of per diems, as &%"% o% (*15 specificall9 and cate:oricall9 provides for the pa9ment of a per diem for the attendance of the mem?ers of the !oard of Directors at ?oard meetin:s of PE@"% The petitioner contends that this law is presumed to ?e validF unless and until the law is declared unconstitutional, it remains in effect and ?indin: for all intents and purposes% either can this law ?e rendered nu:ator9 on the ?asis of a mere memorandum circular C/" ,emorandum o% *(=0)< issued ?9 the C/"% The petitioner stresses that &%"% o% (*15 is a statute more superior than an administrative directive and the former cannot Just ?e repealed or amended ?9 the latter% The petitioner also posits that &%"% o% (*15 was enacted four 7'8 9ears after the case of Civil Liberties Union was promul:ated% .t is, therefore, assumed that the le:islature, ?efore enactin: a law, was aware of the prior holdin:s of the courts% 0ince the constitutionalit9 or the validit9 of &%"% o% (*15 was never challen:ed, the provision on the pa9ment of per diems remains in force notwithstandin: the Civil Liberties Union case% onetheless, the petitioner;s position as Director .A is not included in the enumeration of officials prohi?ited to receive additional compensation as clarified in the &esolution of the Court dated "u:ust 1, 1**1F thus, he is still entitled to receive the per diems% The petitioner;s contentions are untena?le% .t must ?e noted that the petitioner;s presence in the PE@" !oard meetin:s is solel9 ?9 virtue of his capacit9 as representative of the 0ecretar9 of La?or% "s the petitioner himself admitted, there was no separate or special appointment for such position% 0ince the 0ecretar9 of La?or is prohi?ited from receivin: compensation for his additional office or emplo9ment, such prohi?ition li6ewise applies to the petitioner who sat in the !oard onl9 in ?ehalf of the 0ecretar9 of La?or% The petitioner;s case stands on all fours with the case of #ela Cr!$ v. Commission on %!dit% 2ere, the Court upheld the C/" in disallowin: the pa9ment of honoraria and per diems to the officers concerned who sat as mem?ers of the !oard of Directors of the ational 2ousin: "uthorit9% The officers concerned sat as alternates of their superiors in an ex officio capacit9% Citin: also the Civil Liberties Union case, the Court explained thus: HThe ex&officio position ?ein: actuall9 and in le:al contemplation part of the principal office, it follows that the official concerned has no ri:ht to receive additional compensation for his services in the said position% The reason is that these services are alread9 paid for and covered ?9 the compensation attached to his principal office% .t should ?e o?vious that if, sa9, the 0ecretar9 of 3inance attends a meetin: of the ,onetar9 !oard as an ex& officio mem?er thereof, he is actuall9 and in le:al contemplation performin: the primar9 function of his principal office in definin: polic9 in monetar9 ?an6in: matters, which come under the Jurisdiction of his department% 3or such attendance, therefore, he is not entitled to collect an9 extra compensation, whether it ?e in the form of a per diem or an honorari!m or an allowance, or some other such euphemism% !9 whatever name it is desi:nated, such additional compensation is prohi?ited ?9 the Constitution%I C 0ince the Executive Department 0ecretaries, as ex&officio mem?ers of the 2" !oard, are prohi?ited from receivin: Hextra 7additional8 compensation, whether it ?e in the form of a per diem or an honorari!m or an allowance, or some other such euphemism,I it follows that petitioners who sit as their alternates cannot li6ewise ?e entitled to receive such compensation% " contrar9 rule would :ive petitioners a ?etter ri:ht than their principals% 0imilarl9 in the case at ?ar, we cannot allow the petitioner who sat as representative of the 0ecretar9 of La?or in the PE@" !oard to have a ?etter ri:ht than his principal% "s the representative of the 0ecretar9 of La?or, the petitioner sat in the !oard in the same capacit9 as his principal% Ghatever laws and rules the mem?er in the !oard is covered, so is the representativeF and whatever prohi?itions or restrictions the mem?er is su?Jected, the representative is, li6ewise, not exempted% Thus, his position as Director .A of the D/LE which the petitioner claims is not covered ?9 the constitutional prohi?ition set ?9 the Civil Liberties Union case is of no moment% The petitioner attended the ?oard meetin:s ?9 the authorit9 :iven to him ?9 the 0ecretar9 of La?or to sit as his representative% .f it were not for such desi:nation, the petitioner would not have ?een in the !oard at all% There is also no merit in the alle:ation that the le:islature was certainl9 aware of the parameters set ?9 the Court when it enacted &%"% o% (*15, four 7'8 9ears after the finalit9 of the Civil Liberties Union case% The pa9ment of per diems was clearl9 an express :rant in favor of the mem?ers of the !oard of Directors which the petitioner is entitled to receive% .t is a ?asic tenet that an9 le:islative enactment must not ?e repu:nant to the hi:hest law of the land which is the Constitution% o law can render nu:ator9 the Constitution

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Constitutional Law 1 Chapter 10: The Executive Department, and Chapter 11: Powers of the President ?ecause the Constitution is more superior to a statute% .f a law happens to infrin:e upon or violate the fundamental law, courts of Justice ma9 step in to nullif9 its effectiveness% .t is the tas6 of the Court to see to it that the law must conform to the Constitution% .n the clarificator9 resolution issued ?9 the Court in the Civil Liberties Union case on "u:ust 1, 1**1, the Court addressed the issue as to the extent of the exercise of le:islative prero:ative, to wit: The 0olicitor $eneral next as6s: Hx x x ma9 the Decision then control or otherwise encroach on the exclusive competence of the le:islature to provide funds for a pu?lic purpose, in terms of compensation or honoraria under existin: laws, where in the a?sence of such provision said laws would otherwise meet the terms of the Hexception ?9 lawKI ":ain, the Euestion is anchored on a misperception% .t must ?e stressed that the so=called Hexclusive competence of the le:islature to provide funds for a pu?lic purposeI or to enact all t9pes of laws, for that matter, is not unlimited% Such competence must be exercised within the ramewor! o the undamenta" "aw rom which the #e$is"ature draws its power and with which the resu"tin$ "e$is"ation or statute must con orm% &hen the Court sets aside "e$is"ation or bein$ vio"ative o the Constitution' it is not thereb( substitutin$ its wisdom or that o the #e$is"ature or encroachin$ upon the "atter)s prero$ative' but a$ain simp"( dischar$in$ its sacred tas! o sa e$uardin$ and upho"din$ the paramount "aw% The framers of &%"% the law which is the ?9 &%"% o% <('< to 11 of &%"% o% (*15 o% (*15 must have realiBed the flaw in reason wh9 the law was later amended cure such defect% .n particular, 0ection was amended to read: it is the undersecretaries of the different Departments who should sit as ?oard mem?ers of the PE@"% The option of desi:natin: his representative to the !oard ?9 the different Ca?inet 0ecretaries was deleted% Li6ewise, the last para:raph as to the pa9ment of per diems to the mem?ers of the !oard of Directors was also deleted, considerin: that such stipulation was clearl9 in conflict with the proscription set ?9 the Constitution% Prescindin: from the a?ove, the petitioner is, indeed, not entitled to receive a per diem for his attendance at ?oard meetin:s durin: his tenure as mem?er of the !oard of Director of the PE@"% IN #I./T O0 T/1 0O21.OIN.' the petition is D.0,.00ED% The assailed decision of the C/" is "33.&,ED% 0/ /&DE&ED% Davide, 1r%, C%1%, Aitu:, Lnares=0antia:o, 0andoval= $utierreB, Carpio, "ustria=,artineB, Corona, Carpio=,orales, "Bcuna, and Tin:a, 11%, concur% Puno, 1%, on leave% Pan:ani?an, 1%, /n official leave% Muisum?in:, 1%, o part, due prior Executive action at D/LE%

C/" Decision o% +001=0'> si:ned ?9 Commissioner Celso D% $an:an, Chairman, with Commissioners Emmanuel ,% Dalman and &aul C% 3lores concurrin:% +ollo, p% +(% +ollo, p% *<% %nnex H",I +ollo, p% 1)>% .ncluded per "mended Petition% +ollo, pp% 1)5=1)<% ,d% at +<% 1*' 0C&" )1( 71**18% H0ECT./ 1% Even if allowed ?9 law or ?9 the ordinar9 functions of his position, a mem?er of the Ca?inet, undersecretar9 or assistant secretar9 or other appointive officials of the Executive Department ma9, in addition to his primar9 position, hold not more than two positions in the :overnment and :overnment corporations and receive the correspondin: compensation thereforF Provided, that this limitation shall not appl9 to ad hoc ?odies or committees, or to ?oards, councils or ?odies of which the President is the Chairman% +ollo, p% 1'1 ,d% at >1% ,d% at >% )(1 0C&" 1>( 7+0018% ,d% at 15'% "Euino v. C/,ELEC, +'< 0C&" '00 71**>8% 0ee $arcia v. ,ata, 5> 0C&" >1( 71*(>8% Enacted on 1une 1, 1***%

0ECT./ 11% 'he Philippine conomic (one %!thorit" )P (%* Board. There is here?9 created a ?od9 corporate to ?e 6nown as the Philippine Economic @one "uthorit9 7PE@"8 attached to the Department of Trade and .ndustr9% The !oard shall have a director :eneral with the ran6 of department undersecretar9 who shall ?e appointed ?9 the President% The director :eneral shall ?e at least fort9 7'08 9ears of a:e, of proven pro?it9 and inte:rit9, and a de:ree holder in an9 of the followin: fields: economics, ?usiness, pu?lic administration, law, mana:ement or their eEuivalent, and with at least ten 7108 9ears relevant wor6in: experience prefera?l9 in the field of mana:ement or pu?lic administration% The director :eneral shall ?e assisted ?9 three 7)8 deput9 directors :eneral each for polic9 and plannin:, administration and operations, who shall ?e appointed ?9 the PE@" !oard, upon the recommendation of the director :eneral% The deput9 directors :eneral shall ?e at least thirt9=five 7)>8 9ears old, with proven pro?it9 and inte:rit9 and a de:ree holder in an9 of the followin: fields: economics, ?usiness, pu?lic administration, law, mana:ement or their eEuivalent% The Board sha"" be composed o thirteen *+,members as o""ows: the 0ecretar9 of the Department of Trade and .ndustr9 as Chairman, the Director $eneral of the Philippine Economic @one "uthorit9 as Aice=chairman, the undersecretaries of the Department of 3inance, the Department of La?or and Emplo9ment, the Department of #the- .nterior and Local $overnment, the Department of Environment and atural &esources, the Department of ":riculture, the Department of Pu?lic Gor6s and 2i:hwa9s, the Department of 0cience and Technolo:9, the Department of Ener:9, the Deput9 Director $eneral of the ational Economic and Development "uthorit9, one 718 representative from the la?or sector, and one 718 representative from the investorsD?usiness sector in the EC/@/ E% .n case of the unavaila?ilit9 of the 0ecretar9 of the Department of Trade and .ndustr9 to attend a particular ?oard meetin:, the Director $eneral of PE@" shall act as Chairman% "s can ?e :leaned from a?ove, the mem?ers of the !oard of Directors was increased from < to 1), specif9in: therein that

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Constitutional Law 1 Chapter 10: The Executive Department, and Chapter 11: Powers of the President 0ection 1, &epu?lic "ct o% <('<%

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