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REPUBLIC
OF
THE
PHILIPPINES, petitioner,
vs. HONORABLE
SANDIGANBAYAN (SPECIAL FIRST DIVISION), FERDINAND E.
MARCOS (REPRESENTED BY HIS ESTATE/HEIRS: IMELDA R.
MARCOS, MARIA IMELDA [IMEE] MARCOS-MANOTOC, FERDINAND R.
MARCOS, JR. AND IRENE MARCOS-ARANETA), AND IMELDA
ROMUALDEZ MARCOS, respondents.
RESOLUTION
CORONA, J.:
Before us are motions dated August 1, 2003, August 2, 2003 and August 25,
2003 of respondents Imelda R. Marcos, Irene Marcos-Araneta, Ma. Imelda Marcos
and Ferdinand R. Marcos, Jr., respectively, seeking reconsideration of our decision
dated July 15, 2003 which ordered the forfeiture in favor of the Republic of the
Philippines of the Swiss deposits in escrow at the Philippine National Bank (PNB) in
the estimated aggregate amount of US$658,175,373.60 as of January 31, 2002.
Respondent Imelda Marcos, in her motion for reconsideration, asks this Court to
set aside the aforesaid decision dated July 15, 2003, premised on the following
grounds:
I
THE DECISION OF THIS HONORABLE COURT EFFECTIVELY
DEPRIVED RESPONDENT OF HER CONSTITUTIONALLY ENSHRINED
RIGHT TO DUE PROCESS ON THE FOLLOWING GROUNDS:
II
II
SUMMARY JUDGMENT IS APPLICABLE TO A PETITION FOR
FORFEITURE, AS LONG AS THERE IS NO GENUINE FACTUAL ISSUE
WHICH WOULD CALL FOR TRIAL ON THE MERITS.
III
THE DECISION DATED JULY 15, 2003 OF THIS HONORABLE COURT
CLEARLY EXPRESSED THE FACTS ON WHICH IT IS BASED, MOST
OF WHICH WERE ADMITTED BY PRIVATE RESPONDENTS IN THEIR
PLEADINGS SUBMITTED TO THE SANDIGANBAYAN AND IN THE
COURSE OF THE PROCEEDINGS.
IV
VII
VIII
THE STATEMENT OF OPERATIVE FACTS/FACTUAL NARRATION AS
WELL AS THE CONCLUSIONS REACHED IN THE DECISION ARE
CONTRADICTED OR REFUTED BY THE PLEADINGS OF THE
PARTIES, THE JUDICIAL ADMISSIONS OF PETITIONER, THE
PROCEEDINGS BEFORE SANDIGANBAYAN AND THE ORDERS
ISSUED.
Respondent Irene Araneta, in her motion for reconsideration, merely reiterates
the arguments previously raised in the pleadings she filed in this Court and prays that
the Courts decision dated July 15, 2003 be set aside.
In its consolidated comment dated September 29, 2003, the Office of the
Solicitor General argues that:
VI
THE DECISION DATED JULY 15, 2003 OF THIS HONORABLE COURT
WILL NOT PREJUDICE THE CRIMINAL ACTIONS FILED AGAINST
RESPONDENT IMELDA R. MARCOS FOR VIOLATION OF THE ANTIGRAFT AND CORRUPT PRACTICES ACT.
On October 6, 2003, respondents Marcos, Jr. and Imee Marcos filed a motion
for leave to file a reply to petitioner Republic's consolidated comment, which this
Court granted. On October 22, 2003, they filed their reply to the consolidated
comment.
As the aforequoted issues are interwoven, the Court shall discuss them
together.
At the outset, we note that respondents, in their motions for reconsideration, do
not raise any new matters for the Court to resolve. The arguments in their motions for
reconsideration are mere reiterations of their contentions fully articulated in their
previous pleadings, and exhaustively probed and passed upon by the Court.
I
THE MOTIONS FOR RECONSIDERATION DO NOT RAISE ANY NEW
MATTER AND WERE FILED MANIFESTLY TO DELAY THE EXECUTION
OF THE DECISION DATED JULY 15, 2003.
Respondent Marcoses argue that the letter and intent of RA 1379 forbid and
preclude summary judgment as the process to decide forfeiture cases under the law.
It provides for specific jurisdictional allegations in the petition and mandates a welldefined procedure to be strictly observed before a judgment of forfeiture may be
rendered.
According to respondents, Section 5 of RA 1379 requires the court to set a date
for hearing during which respondents shall be given ample opportunity to explain, to
the satisfaction of the court, how they acquired the property. They contend that the
proceedings under RA 1379 are criminal in character, thus they have all the rights of
an accused under the Constitution such as the right to adduce evidence and the right
to a hearing. They claim that it is petitioner which has the burden of proving
respondents' guilt beyond reasonable doubt and that forfeiture of property should
depend not on the weakness of their evidence but on the strength of petitioner's.
Accordingly, respondents maintain that, due to the criminal nature of forfeiture
proceedings, the denials raised by them were sufficient to traverse all the allegations
in the petition for forfeiture.
The issue of the propriety of summary judgment was painstakingly discussed
and settled in our July 15, 2003 decision:
A summary judgment is one granted upon motion of a party for an expeditious settlement of
the case, it appearing from the pleadings, depositions, admissions and affidavits that there are
no important questions or issues of fact posed and, therefore, the movant is entitled to a
judgment as a matter of law. A motion for summary judgment is premised on the assumption
that the issues presented need not be tried either because these are patently devoid of substance
or that there is no genuine issue as to any pertinent fact. It is a method sanctioned by the
Rules of Court for the prompt disposition of a civil action where there exists no serious
controversy. Summary judgment is a procedural devise for the prompt disposition of actions in
which the pleadings raise only a legal issue, not a genuine issue as to any material fact. [1]
process clause, there must be compliance with both substantive and the procedural
requirements thereof.[2]
In the present context, substantive due process refers to the intrinsic validity of a
[3]
law that interferes with the rights of a person to his property. On the other hand,
procedural due process means compliance with the procedures or steps, even
periods, prescribed by the statute, in conformity with the standard of fair play and
without arbitrariness on the part of those who are called upon to administer it. [4]
Insofar as substantive due process is concerned, there is no showing that RA
1379 is unfair, unreasonable or unjust. In other words, respondent Marcoses are not
being deprived of their property through forfeiture for arbitrary reasons or on flimsy
grounds. As meticulously explained in the July 15, 2003 decision of the Court, EO
No. 1[5] created the PCGG primarily to assist then President Corazon Aquino in the
recovery, pursuant to RA 1379, of vast government resources amassed and stolen by
former President Ferdinand Marcos, his immediate family, relatives, close associates
and other cronies. These assets were stashed away here and abroad.
A careful study of the provisions of RA 1379 readily discloses that the forfeiture
proceedings in the Sandiganbayan did not violate the substantive rights of respondent
Marcoses. These proceedings are civil in nature, contrary to the claim of the
Marcoses that it is penal in character.
In Almeda Sr., et al. vs. Perez, et al., [6] we suggested a test to determine
whether the proceeding for forfeiture is civil or criminal:
. . . Forfeiture proceedings may be either civil or criminal in nature, and may be in rem or in
personam. If they are under a statute such that if an indictment is presented the forfeiture can
be included in the criminal case they are criminal in nature, although they may be civil in
form; and where it must be gathered from the statute that the action is meant to be criminal in
its nature it cannot be considered as civil. If, however, the proceeding does not involve the
conviction of the wrongdoer for the offense charged the proceeding is of a civil nature; and
under statutes which specifically so provide, where the act or omission for which the forfeiture
is imposed is not also a misdemeanor, such forfeiture may be sued for and recovered in a civil
action. (37 CJS, Forfeiture, Sec. 5, pp. 15-16)
In the case of Republic vs. Sandiganbayan and Macario Asistio, Jr.,[7] this Court
categorically declared that:
The rule is settled that forfeiture proceedings are actions in rem and therefore civil in nature.
The proceedings under RA 1379 do not terminate in the imposition of a penalty
but merely in the forfeiture of the properties illegally acquired in favor of the
State. Section 6 of said law provides:
x x x If the respondent is unable to show to the satisfaction of the court that he has lawfully
acquired the property in question, then the court shall declare such property forfeited in favor
of the State, and by virtue of such judgment the property aforesaid shall become property of
the State x x x
The procedure outlined in the law leading to forfeiture is that provided for in
a civil action:
xxx
xxx
xxx
Sec. 3. The petition The petition shall contain the following information:
(a)
(b)
The public office or employment he holds and such other public
offices or employments which he has previously held.
(c)
The approximate amount of property he has acquired during his
incumbency in his past and present offices and employments.
(d)
A description of said property, or such thereof as has been
identified by the Solicitor General.
(e)
The total amount of his government salary and other proper
earnings and incomes from legitimately acquired property, and
(f)
Such other information as may enable the court to determine
whether or not the respondent has unlawfully acquired property during his
incumbency.
xxx
xxx
xxx
Sec. 4. Period for the answer. The respondent shall have a period of fifteen days within
which to present his answer.
In short, there is a petition, then an answer and lastly, a hearing. The preliminary
investigation required prior to the filing of the petition, in accordance with Section 2 of
the Act, is expressly provided to be similar to a preliminary investigation in a criminal
case. The similarity, however, ends there for, if the investigation were akin to that in a
criminal case but all the other succeeding steps were those for a civil proceeding,
then the process as a whole is definitely not criminal. Were it a criminal proceeding,
there would be, after preliminary investigation, a reading of the information, a plea of
guilty or not guilty, a trial and a reading of judgment in the presence of respondents.
But these steps, as above set forth, are clearly not provided for in the law.
Prescinding from the foregoing discussion, save for annulment of marriage or
declaration of its nullity or for legal separation, summary judgment is applicable to all
kinds of actions.[8]
The proceedings in RA 1379 and EO No. 14 were observed in the prosecution
of the petition for forfeiture. Section 1 of EO No.14-A, dated August 18, 1986,
amending Section 3 of EO No.14, provides that civil suits to recover unlawfully
acquired property under RA 1379 may be proven by preponderance of evidence.
Under RA 1379 and EO Nos. 1 and 2, the Government is required only to state the
known lawful income of respondents for the prima facie presumption of illegal
provenance to attach. As we fully explained in our July 15, 2003 decision,petitioner
Republic was able to establish this prima facie presumption. Thus, the burden of proof
shifted, by law, to the respondents to show by clear and convincing evidence that the
Swiss deposits were lawfully acquired and that they had other legitimate sources of
income. This, respondent Marcoses did not do. They failed or rather, refused to
raise any genuine issue of fact warranting a trial for the reception of evidence
therefor. For this reason and pursuant to the State policy to expedite recovery of illgotten wealth, petitioner Republic moved for summary judgment which the
Sandiganbayan appropriately acted on.
Respondents also claim that summary judgment denies them their right to a
hearing and to present evidence purposely granted under Section 5 of RA 1379.
Respondents were repeatedly accorded full opportunity to present their case,
their defenses and their pleadings. Not only did they obstinately refuse to do
so. Respondents time and again tried to confuse the issues and the Court itself, and
to delay the disposition of the case.
Section 5 of RA 1379 provides:
The court shall set a date for a hearing which may be open to the public, and during which the
respondent shall be given ample opportunity to explain, to the satisfaction of the court, how he
has acquired the property in question.
And pursuant to Section 6 of the said law, if the respondent is unable to show to the
satisfaction of the court that he has lawfully acquired the property in question, then
the court shall declare such property forfeited in favor of the State.
Respondent Marcoses erroneously understood hearing to be synonymous with
trial. The words hearing and trial have different meanings and connotations. Trial
may refer to the reception of evidence and other processes. It embraces the period
for the introduction of evidence by both parties. Hearing, as known in law, is not
confined to trial but embraces the several stages of litigation, including the pre-trial
stage. A hearing does not necessarily mean presentation of evidence. It does not
necessarily imply the presentation of oral or documentary evidence in open court but
that the parties are afforded the opportunity to be heard.
A careful analysis of Section 5 of RA 1379 readily discloses that the word
hearing does not always require the formal introduction of evidence in a trial, only
that the parties are given the occasion to participate and explain how they acquired
the property in question. If they are unable to show to the satisfaction of the court that
they lawfully acquired the property in question, then the court shall declare such
property forfeited in favor of the State. [9] There is no provision in the law that a full
blown trial ought to be conducted before the court declares the forfeiture of the
subject property. Thus, even if the forfeiture proceedings do not reach trial, the court
is not precluded from determining the nature of the acquisition of the property in
question even in a summary proceeding.
Due process, a constitutional precept, does not therefore always and in all
situations require a trial-type proceeding. The essence of due process is found in the
reasonable opportunity to be heard and submit ones evidence in support of his
defense. What the law prohibits is not merely the absence of previous notice but the
[10]
absence thereof and the lack of opportunity to be heard. This opportunity was
made completely available to respondents who participated in all stages of the
litigation.
When the petition for forfeiture was filed at the Sandiganbayan, respondent
Marcoses argued their case and engaged in all of the lengthy discussions,
argumentation, deliberations and conferences, and submitted their pleadings,
documents and other papers. When petitioner Republic moved for summary
judgment, respondent Marcoses filed their demurrer to evidence. They agreed to
submit the case for decision with their opposition to the motion for summary
judgment. They moved for the reconsideration of the Sandiganbayan resolution dated
September 19, 2000 which granted petitioner Republics motion for summary
judgment (which was in fact subsequently reversed in its January 31, 2002
resolution.) And when the case finally reached this Court, respondent Marcoses were
given, on every occasion, the chance to file and submit all the pleadings necessary to
defend their case. And even now that the matter has been finally settled and
adjudicated, their motion for reconsideration is being heard by this Court.
But a forfeiture proceeding is an action in rem, against the thing itself instead of
against the person. Being civil in character, it requires no more than a preponderance
of evidence.[11] And by preponderance of evidence is meant that the evidence as a
[12]
whole adduced by one side is superior to that of the other.
Hence, the factual
findings of this Court in its decision dated July 15, 2003 will, as a consequence,
neither affect nor do away with the requirement of having to prove her guilt beyond
reasonable doubt in the criminal cases against her.
One final note. We take judicial notice of newspaper accounts that a certain
Judge Manuel Real of the US District Court of Hawaii issued a global freeze order
on the Marcos assets, including the Swiss deposits. We reject this order outrightly
because
it
is
a
transgression
not
only
of
the
principle
of
territoriality in public international law but also of the jurisdiction of this Court
recognized by the parties-in-interest and the Swiss government itself.
WHEREFORE, the motions for reconsideration are hereby DENIED with
FINALITY.
SO ORDERED.
For twelve long years, respondent Marcoses tried to stave off this case with
nothing but empty claims of lack of knowledge or information sufficient to form a
belief, or they were not privy to the transactions, or they could not remember
(because the transactions) happened a long time ago or that the assets were
lawfully acquired. And they now allege deprivation of their right to be heard and
present evidence in their defense?
Petitioner Republic has the right to a speedy disposition of this case. It would
readily be apparent to a reasonable mind that respondent Marcoses have been
deliberately resorting to every procedural device to delay the resolution hereof. There
is justice waiting to be done. The people and the State are entitled to favorable
judgment, free from vexatious, capricious and oppressive delays, the salutary
objective being to restore the ownership of the Swiss deposits to the rightful owner,
the Republic of the Philippines, within the shortest possible time.
The respondent Marcoses cannot deny that the delays in this case have all been
made at their instance. The records can testify to this incontrovertible fact. It will be a
mockery of justice to allow them to benefit from it. By their own deliberate acts not
those of the Republic or anybody else they are deemed to have altogether waived
or abandoned their right to proceed to trial.
Respondent Imelda R. Marcos likewise asserts that the factual finding that the
foundations involved in the instant forfeiture proceedings were businesses managed
by her and her late husband, will adversely affect the criminal proceedings filed by the
Republic against her. The contention is bereft of merit. The criminal cases referred
to by said respondent are actions in personam, directed against her on the basis of
her personal liability. In criminal cases, the law imposes the burden of proving guilt
on the prosecution beyond reasonable doubt, and the trial judge in evaluating the
evidence must find that all the elements of the crime charged have been established
by sufficient proof to convict.
DECISION
AZCUNA, J.:
These are petitions for certiorari, etc. as special civil actions and/or for review of the
Decision of the Court of Appeals in Lance Corporal Daniel J. Smith v. Hon. Benjamin T.
Pozon, et al., in CA-G.R. SP No. 97212, dated January 2, 2007.
The facts are not disputed.
Respondent Lance Corporal (L/CPL) Daniel Smith is a member of the United States
Armed Forces. He was charged with the crime of rape committed against a Filipina, petitioner
herein, sometime on November 1, 2005, as follows:
The undersigned accused LCpl. Daniel Smith, Ssgt. Chad Brian
Carpentier, Dominic Duplantis, Keith Silkwood and Timoteo L. Soriano,
Jr. of the crime of Rape under Article 266-A of the Revised Penal Code, as
amended by Republic Act 8353, upon a complaint under oath filed by
Suzette S. Nicolas, which is attached hereto and made an integral part
hereof as Annex A, committed as follows:
That on or about the First (1st) day of
November 2005, inside the Subic Bay Freeport Zone,
L/CPL. DANIEL J. SMITH shall serve his sentence in the facilities that
shall, thereafter, be agreed upon by appropriate Philippine and United
States authorities. Pending agreement on such facilities, accused L/CPL.
DANIEL J. SMITH is hereby temporarily committed to the Makati City
Jail.
Accused L/CPL. DANIEL J. SMITH is further sentenced to
indemnify complainant SUZETTE S. NICOLAS in the amount
of P50,000.00 as compensatory damages plus P50,000.00 as moral
damages.
SO ORDERED.[2]
As a result, the Makati court ordered Smith detained at the Makati jail until further
orders.
On December 29, 2006, however, defendant Smith was taken out of the Makati jail
by a contingent of Philippine law enforcement agents, purportedly acting under orders of the
Department of the Interior and Local Government, and brought to a facility for detention under
the control of the United States government, provided for under new agreements between the
Philippines and the United States, referred to as the Romulo-Kenney Agreement of December
19, 2006 which states:
The Government of the Republic of the Philippines and the Government of
the United States of America agree that, in accordance with the Visiting
Forces Agreement signed between our two nations, Lance Corporal Daniel
J. Smith, United States Marine Corps, be returned to U.S. military custody
at the U.S. Embassy in Manila.
(Sgd.) KRISTIE A. KENNEY
Representative of the United States
of America
DATE:
12-19-06
The matter was brought before the Court of Appeals which decided on January 2,
2007, as follows:
WHEREFORE, all the foregoing considered, we resolved to
DISMISS the petition for having become moot. [3]
Subsequently, the United States agreed to turn over these bases to the Philippines;
and with the expiration of the RP-US Military Bases Agreement in 1991, the territory covered
by these bases were finally ceded to the Philippines.
To prevent a recurrence of this experience, the provision in question was adopted in
the 1987 Constitution.
The provision is thus designed to ensure that any agreement allowing the presence of
foreign military bases, troops or facilities in Philippine territory shall be equally binding on
the Philippines and the foreign sovereign State involved. The idea is to prevent a recurrence
of the situation in which the terms and conditions governing the presence of foreign armed
forces in our territory were binding upon us but not upon the foreign State.
Applying the provision to the situation involved in these cases, the question is
whether or not the presence of US Armed Forces in Philippine territory pursuant to the VFA is
allowed under a treaty duly concurred in by the Senate xxx and recognized as a treaty by
the other contracting State.
This Court finds that it is, for two reasons.
First, as held in Bayan v. Zamora,[5] the VFA was duly concurred in by the
Philippine Senate and has been recognized as a treaty by the United States as attested and
certified by the duly authorized representative of the United States government.
The fact that the VFA was not submitted for advice and consent of the United States
Senate does not detract from its status as a binding international agreement or treaty
recognized by the said State. For this is a matter of internal United States law. Notice can be
taken of the internationally known practice by the United States of submitting to its Senate for
advice and consent agreements that are policymaking in nature, whereas those that carry out or
further implement these policymaking agreements are merely submitted to Congress, under
the provisions of the so-called CaseZablocki Act, within sixty days from ratification. [6]
The second reason has to do with the relation between the VFA and the RP-US
Mutual Defense Treaty of August 30, 1951. This earlier agreement was signed and duly
ratified with the concurrence of both the Philippine Senate and the United States Senate.
The RP-US Mutual Defense Treaty states:[7]
It will be recalled that under the Philippine Bill of 1902, which laid the basis for the
Philippine Commonwealth and, eventually, for the recognition of independence, the United
States agreed to cede to the Philippines all the territory it acquired from Spain under the Treaty
of Paris, plus a few islands later added to its realm, except certain naval ports and/or military
bases and facilities, which the United States retained for itself.
This is noteworthy, because what this means is that Clark and Subic and the other
places in the Philippines covered by the RP-US Military Bases Agreement of 1947 were not
Philippine territory, as they were excluded from the cession and retained by the US.
Accordingly, the Philippines had no jurisdiction over these bases except to the extent
allowed by the United States. Furthermore, the RP-US Military Bases Agreement was never
advised for ratification by the United States Senate, a disparity in treatment, because
the Philippines regarded it as a treaty and had it concurred in by our Senate.
under its jurisdiction in the Pacific Ocean, its armed forces, public vessels
or aircraft in the Pacific.
ARTICLE VI. This Treaty does not affect and shall not be
interpreted as affecting in any way the rights and obligations of the Parties
under the Charter of the United Nations or the responsibility of the United
Nations for the maintenance of international peace and security.
P.
(Sgd.) JOAQUIN
M.
(Sgd.) VICENTE
J.
ROMULO
ARTICLE II. In order more effectively to achieve the objective of
this Treaty, the Parties separately and jointly by self-help and mutual
aid will maintain and develop their individual and collective capacity
to resist armed attack.
ELIZALDE
FRANCISCO
(Sgd.) DIOSDADO
MACAPAGAL
DULLES
Any such armed attack and all measures taken as a result thereof
shall be immediately reported to the Security Council of the United
Nations. Such measures shall be terminated when the Security Council
has taken the measures necessary to restore and maintain international
peace and security.
ARTICLE V. For the purpose of Article IV, an armed attack on
either of the Parties is deemed to include an armed attack on the
metropolitan territory of either of the Parties, or on the island territories
Reaffirming their faith in the purposes and principles of the Charter of the
United Nations and their desire to strengthen international and regional
security in the Pacific area;
Reaffirming their obligations under the Mutual Defense Treaty
of August 30, 1951;
Noting that from time to time elements of the United States armed
forces may visit the Republic of the Philippines;
Considering that cooperation between the United States and the
Republic of the Philippines promotes their common security interests;
Recognizing the desirability of defining the treatment of United
States personnel visiting the Republic of the Philippines;
Have agreed as follows:[9]
Article V
Criminal Jurisdiction
xxx
6. The custody of any United States personnel over whom the
Philippines is to exercise jurisdiction shall immediately reside with United
States military authorities, if they so request, from the commission of the
offense until completion of all judicial proceedings. United States military
authorities shall, upon formal notification by the Philippine authorities and
without delay, make such personnel available to those authorities in time
for any investigative or judicial proceedings relating to the offense with
which the person has been charged. In extraordinary cases, the Philippine
The equal protection clause is not violated, because there is a substantial basis for a
different treatment of a member of a foreign military armed forces allowed to enter our
territory and all other accused. [11]
The rule in international law is that a foreign armed forces allowed to enter ones
territory is immune from local jurisdiction, except to the extent agreed upon. The Status of
Forces Agreements involving foreign military units around the world vary in terms and
conditions, according to the situation of the parties involved, and reflect their bargaining
power. But the principle remains, i.e., the receiving State can exercise jurisdiction over the
forces of the sending State only to the extent agreed upon by the parties. [12]
As a result, the situation involved is not one in which the power of this Court to
adopt rules of procedure is curtailed or violated, but rather one in which, as is normally
encountered around the world, the laws (including rules of procedure) of one State do not
extend or apply except to the extent agreed upon to subjects of another State due to the
recognition of extraterritorial immunity given to such bodies as visiting foreign armed
forces.
Nothing in the Constitution prohibits such agreements recognizing immunity from
jurisdiction or some aspects of jurisdiction (such as custody), in relation to long-recognized
subjects of such immunity like Heads of State, diplomats and members of the armed forces
contingents of a foreign State allowed to enter another States territory. On the contrary, the
Constitution states that the Philippines adopts the generally accepted principles of international
law as part of the law of the land. (Art. II, Sec. 2).
Applying, however, the provisions of VFA, the Court finds that there is a different
treatment when it comes to detention as against custody. The moment the accused has to be
detained, e.g., after conviction, the rule that governs is the following provision of the VFA:
Article V
Criminal Jurisdiction
xxx
It is clear that the parties to the VFA recognized the difference between custody
during the trial and detention after conviction, because they provided for a specific
arrangement to cover detention. And this specific arrangement clearly states not only that the
detention shall be carried out in facilities agreed on by authorities of both parties, but also that
the detention shall be by Philippine authorities. Therefore, the Romulo-Kenney Agreements
of December 19 and 22, 2006, which are agreements on the detention of the accused in
the United States Embassy, are not in accord with the VFA itself because such detention is
not by Philippine authorities.
Respondents should therefore comply with the VFA and negotiate with
representatives of the United States towards an agreement on detention facilities under
Philippine authorities as mandated by Art. V, Sec. 10 of the VFA.
Next, the Court addresses the recent decision of the United States Supreme Court
in Medellin v. Texas ( 552 US ___ No. 06-984, March 25, 2008), which held that treaties
entered into by the United States are not automatically part of their domestic law unless these
treaties are self-executing or there is an implementing legislation to make them enforceable.
On February 3, 2009, the Court issued a Resolution, thus:
G.R. No. 175888 (Suzette Nicolas y Sombilon v. Alberto Romulo, et al.);
G.R. No. 176051 (Jovito R. Salonga, et al. v. Daniel Smith, et
al.); and G.R. No. 176222 (Bagong Alyansang Makabayan
[BAYAN], et al. v. President Gloria Macapagal-Arroyo, et al.).
The parties, including the Solicitor General, are required to submit
within three (3) days a Comment/Manifestation on the following points:
1.
2.
3.
Art. II, Sec. 2 treaties These are advised and consented to by the US
Senate in accordance with Art. II, Sec. 2 of the US Constitution.
2.
3.
LEONARDO-DE
CASTRO,
BRION, and
PERALTA, JJ.
COMMISSION ON AUDIT,
Promulgated:
Respondent.
February 26, 2009
x-----------------------------------------------------x
As regards the implementation of the RP-US Mutual Defense Treaty, military aid or
assistance has been given under it and this can only be done through implementing
legislation. The VFA itself is another form of implementation of its provisions.
DECISION
CARPIO, J.:
WHEREFORE, the petitions are PARTLY GRANTED, and the Court of Appeals
Decision in CA-G.R. SP No. 97212 dated January 2, 2007 is MODIFIED. The Visiting
Forces Agreement (VFA) between the Republic of the Philippines and the United States,
entered into on February 10, 1998, is UPHELD as constitutional, but the Romulo-Kenney
Agreements of December 19 and 22, 2006 are DECLARED not in accordance with the
VFA, and respondent Secretary of Foreign Affairs is hereby ordered to forthwith negotiate
with the United States representatives for the appropriate agreement on detention facilities
under Philippine authorities as provided in Art. V, Sec. 10 of the VFA, pending which
the status quo shall be maintained until further orders by this Court.
The Court of Appeals is hereby directed to resolve without delay the related matters
pending therein, namely, the petition for contempt and the appeal of L/CPL Daniel Smith from
the judgment of conviction.
No costs.
SO ORDERED.
EN BANC
- versus -
PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,*
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
TINGA,*
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
The Case
This is a petition for certiorari [1] with prayer for the issuance of a temporary restraining
order and a writ of preliminary injunction. The petition seeks to nullify Decision No. 2007020[2] dated 12 April 2007 of the Commission on Audit (COA).
The Facts
On 13 March 1992, Congress approved Republic Act (RA) No. 7227 [3] creating the
Bases Conversion and Development Authority (BCDA). Section 9 of RA No. 7227 states that
the BCDA Board of Directors (Board) shall exercise the powers and functions of the
BCDA. Under Section 10, the functions of the Board include the determination of the
organizational structure and the adoption of a compensation and benefit scheme at least
equivalent to that of the Bangko Sentral ng Pilipinas (BSP). Accordingly, the Board
determined the organizational structure of the BCDA and adopted a compensation and benefit
scheme for its officials and employees.
On 20 December 1996, the Board adopted a new compensation and benefit scheme
which included a P10,000 year-end benefit granted to each contractual employee, regular
permanent employee, and Board member. In a memorandum[4] dated 25 August 1997, Board
Chairman Victoriano A. Basco (Chairman Basco) recommended to President Fidel V. Ramos
(President Ramos) the approval of the new compensation and benefit scheme. In a
memorandum[5] dated 9 October 1997, President Ramos approved the new compensation and
benefit scheme.
In 1999, the BSP gave a P30,000 year-end benefit to its officials and employees. In
2000, the BSP increased the year-end benefit from P30,000 to P35,000. Pursuant to Section
10 of RA No. 7227 which states that the compensation and benefit scheme of the BCDA shall
be at least equivalent to that of the BSP, the Board increased the year-end benefit of BCDA
officials and employees from P10,000 to P30,000. Thus in 2000 and 2001, BCDA officials
and employees received a P30,000 year-end benefit, and, on 1 October 2002, the Board passed
Resolution No. 2002-10-193[6] approving the release of a P30,000 year-end benefit for 2002.
Aside from the contractual employees, regular permanent employees, and Board
members, the full-time consultants of the BCDA also received the year-end benefit.
On 20 February 2003, State Auditor IV Corazon V. Espao of the COA issued Audit
Observation Memorandum (AOM) No. 2003-004[7] stating that the grant of year-end benefit to
Board members was contrary to Department of Budget and Management (DBM) Circular
Letter No. 2002-2 dated 2 January 2002. In Notice of Disallowance (ND) No. 03-001-BCDA(02)[8] dated 8 January 2004, Director IV Rogelio D. Tablang (Director Tablang), COA, Legal
and Adjudication Office-Corporate, disallowed the grant of year-end benefit to the Board
members and full-time consultants. In Decision No. 2004-013[9] dated 13 January 2004,
Director Tablang concurred with AOM No. 2003-004 and ND No. 03-001-BCDA-(02).
In a letter[10] dated 20 February 2004, BCDA President and Chief Executive Officer Rufo
Colayco requested the reconsideration of Decision No. 2004-013. In a Resolution[11] dated 22
June 2004, Director Tablang denied the request. The BCDA filed a notice of appeal [12] dated 8
September 2004 and an appeal memorandum[13] dated 23 December 2004 with the COA.
The COAs Ruling
In Decision No. 2007-020,[14] the COA affirmed the disallowance of the year-end benefit
granted to the Board members and full-time consultants and held that the presumption of good
faith did not apply to them. The COA stated that:
despite the earlier clarification on the matter by the DBM thru the issuance
on January 2, 2002 of DBM Circular Letter No. 2002-02, still, the BCDA
Board of Directors enacted Resolution No. 2002-10-93 on October 1, 2002
granting YEB to the BCDA personnel including themselves. Full time
consultants, being non-salaried personnel, are also not entitled to such
presumption since they knew from the very beginning that they are only
entitled to the amount stipulated in their contracts as compensation for
their services. Hence, they should be made to refund the disallowed
YEB.[15] (Boldfacing in the original)
Hence, this petition.
The Courts Ruling
The Board members and full-time consultants of the BCDA are not entitled to the yearend benefit.
First, the BCDA claims that the Board can grant the year-end benefit to its members and
full-time consultants because, under Section 10 of RA No. 7227, the functions of the Board
include the adoption of a compensation and benefit scheme.
The Court is not impressed. The Boards power to adopt a compensation and benefit
scheme is not unlimited. Section 9 of RA No. 7227 states that Board members are entitled to
a per diem:
2.1
PERA,
personnel
benefits, these
2.2
Members of the Board of Directors of agencies are not
salaried
officials of the government. As
non-salaried
officials
they
are
not
entitled to PERA, ADCOM, YEB
and retirement benefits unless
expressly
provided by law.
2.3
Department Secretaries, Undersecretaries and Assistant
Secretaries
who serve as Ex-officio Members of
the Board of Directors are not
entitled to any
remuneration in
line
with
the
Supreme
Court
ruling
that their services in the Board are already
paid for and covered by
the remuneration attached
to their office. (underscoring ours)
Members of the Board shall receive a per diem of not more than
Five
thousand
pesos
(P5,000)
for
every
board
meeting: Provided, however, That the per diem collected per month
does not exceed the equivalent of four (4) meetings: Provided, further,
That the amount of per diem for every board meeting may be increased by
the President but such amount shall not be increased within two (2) years
after its last increase. (Emphasis supplied)
Section 9 specifies that Board members shall receive a per diem for every board meeting;
limits the amount of per diem to not more than P5,000; and limits the total amount of per
diem for one month to not more than four meetings. In Magno v. Commission on
Audit,[16] Cabili v. Civil Service Commission,[17] De Jesus v. Civil Service
Commission,[18] Molen, Jr. v. Commission on Audit,[19] and Baybay Water District v.
Commission on Audit,[20] the Court held that the specification of compensation and
limitation of the amount of compensation in a statute indicate that Board members are
entitled only to the per diem authorized by law and no other. In Baybay Water District, the
Court held that:
Also, DBM Circular Letter No. 2002-2 states that, Members of the Board of Directors
of agencies are not salaried officials of the government. As non-salaried officials they are
not entitled to PERA, ADCOM, YEB and retirement benefits unless expressly provided by
law. RA No. 7227 does not state that the Board members are entitled to a year-end benefit.
With regard to the full-time consultants, DBM Circular Letter
No. 2002-2 states
that, YEB and retirement benefits, are personnel benefits granted in addition to
salaries. As fringe benefits, these shall be paid only when the basic salary is also
paid. The full-time consultants are not part of the BCDA personnel and are not paid the
basic salary. The full-time consultants consultancy contracts expressly state that there is no
employer-employee relationship between the BCDA and the consultants, and that the BCDA
shall pay the consultants a contract price. For example, the consultancy contract [22] of a
certain Dr. Faith M. Reyes states:
SECTION 2. Contract Price. For and in consideration of the services to
be performed by the CONSULTANT (16 hours/week), BCDA shall pay
her the amount of TWENTY THOUSAND PESOS and 00/100
(P20,000.00), Philippine currency, per month.
II of the Constitution are not self-executing provisions. In that case, the Court held that
Some of the constitutional provisions invoked in the present case were taken from Article II
of the Constitution specifically, Sections 5 x x x and 18 the provisions of which the
Court categorically ruled to be non self-executing.
Third, the BCDA claims that the denial of year-end benefit to the Board members and
full-time consultants violates Section 1, Article III of the Constitution. [25] More specifically,
the BCDA claims that there is no substantial distinction between regular officials and
employees on one hand, and Board members and full-time consultants on the other. The
BCDA states that there is here only a distinction, but no difference because both have
undeniably one common goal as humans, that is x x x to keep body and soul together or,
[d]ifferently put, both have mouths to feed and stomachs to fill.
The Court is not impressed. Every presumption should be indulged in favor of the
constitutionality of RA No. 7227 and the burden of proof is on the BCDA to show that
there is a clear and unequivocal breach of the Constitution.[26] In Abakada Guro Party
List v. Purisima,[27] the Court held that:
xxxx
SECTION 4. Employee-Employer Relationship. It is understood that
no employee-employer relationship shall exist between BCDA and the
CONSULTANT.
SECTION 5. Period of Effectivity. This CONTRACT shall have an
effectivity period of one (1) year, from January 01, 2002 to December 31,
2002, unless sooner terminated by BCDA in accordance with Section 6
below.
Since full-time consultants are not salaried employees of BCDA, they are not entitled to the
year-end benefit which is a personnel benefit granted in addition to salaries and which is
paid only when the basic salary is also paid.
The BCDA failed to show that RA No. 7227 unreasonably singled out Board members
and full-time consultants in the grant of the year-end benefit. It did not show any clear and
unequivocal breach of the Constitution. The claim that there is no difference between regular
officials and employees, and Board members and full-time consultants because both groups
have mouths to feed and stomachs to fill is fatuous. Surely, persons are not automatically
similarly situated thus, automatically deserving of equal protection of the laws just
because they both have mouths to feed and stomachs to fill. Otherwise, the existence of a
substantial distinction would become forever highly improbable.
Second, the BCDA claims that the Board members and full-time consultants should be
granted the year-end benefit because the granting of year-end benefit is consistent with
Sections 5 and 18, Article II of the Constitution. Sections 5 and 18 state:
Fourth, the BCDA claims that the Board can grant the year-end benefit to its members
and the full-time consultants because RA No. 7227 does not expressly prohibit it from doing
so.
The Court is not impressed. A careful reading of Section 9 of RA No. 7227 reveals that
the Board is prohibited from granting its members other benefits. Section 9 states:
Members of the Board shall receive a per diem of not more than
Five
thousand
pesos
(P5,000)
for
every
board
meeting: Provided, however, That the per diem collected per month
does not exceed the equivalent of four (4) meetings: Provided, further,
That the amount of per diem for every board meeting may be increased by
the President but such amount shall not be increased within two (2) years
after its last increase. (Emphasis supplied)
Section 9 specifies that Board members shall receive a per diem for every board meeting;
limits the amount of per diem to not more than P5,000; limits the total amount ofper diem for
one month to not more than four meetings; and does not state that Board members may receive
other benefits. In Magno,[28] Cabili,[29] De Jesus,[30] Molen, Jr.,[31] and Baybay Water
District,[32] the Court held that the specification of compensation and limitation of the
amount of compensation in a statute indicate that Board members are entitled only to
the per diem authorized by law and no other.
The specification that Board members shall receive a per diem of not more than P5,000
for every meeting and the omission of a provision allowing Board members to receive other
benefits lead the Court to the inference that Congress intended to limit the compensation of
Board members to the per diem authorized by law and no other. Expressio unius est exclusio
alterius. Had Congress intended to allow the Board members to receive other benefits, it
would have expressly stated so.[33] For example, Congress intention to allow Board members
to receive other benefits besides the per diem authorized by law is expressly stated in Section
1 of RA No. 9286:[34]
SECTION 1. Section 13 of Presidential Decree No. 198, as
amended, is hereby amended to read as follows:
SEC. 13. Compensation. Each director shall receive per
diem to be determined by the Board, for each meeting of the Board
actually attended by him, but no director shall receiveper diems in any
given month in excess of the equivalent of the total per diem of four
meetings in any given month.
Any per diem in excess of One hundred fifty pesos (P150.00) shall
be subject to the approval of the Administration. In addition thereto,
each director shall receive allowances and benefits as the Board may
prescribe subject to the approval of the Administration. (Emphasis
supplied)
The Court cannot, in the guise of interpretation, enlarge the scope of a statute or insert into a
statute what Congress omitted, whether intentionally or unintentionally.[35]
When a statute is susceptible of two interpretations, the Court must adopt the one in
consonance with the presumed intention of the legislature to give its enactments the most
reasonable and beneficial construction, the one that will render them operative and
effective.[36] The Court always presumes that Congress intended to enact sensible
statutes.[37] If the Court were to rule that the Board could grant the year-end benefit to its
members, Section 9 of RA No. 7227 would become inoperative and ineffective the
specification that Board members shall receive a per diem of not more than P5,000 for every
meeting; the specification that the per diem received per month shall not exceed the equivalent
of four meetings; the vesting of the power to increase the amount of per diem in the President;
and the limitation that the amount of per diem shall not be increased within two years from its
last increase would all become useless because the Board could always grant its members
other benefits.
With regard to the full-time consultants, DBM Circular Letter No. 2002-2 states that,
YEB and retirement benefits, are personnel benefits granted in addition to salaries. As
fringe benefits, these shall be paid only when the basic salary is also paid. The full-time
consultants are not part of the BCDA personnel and are not paid the basic salary. The fulltime consultants consultancy contracts expressly state that there is no employer-employee
relationship between BCDA and the consultants and that BCDA shall pay the consultants a
contract price. Since full-time consultants are not salaried employees of the BCDA, they are
not entitled to the year-end benefit which is a personnelbenefit granted in addition to
salaries and which is paid only when the basic salary is also paid.
Fifth, the BCDA claims that the Board members and full-time consultants are entitled to
the year-end benefit because (1) President Ramos approved the granting of the benefit to the
Board members, and (2) they have been receiving it since 1997.
The Court is not impressed. The State is not estopped from correcting a public officers
erroneous application of a statute, and an unlawful practice, no matter how long, cannot give
rise to any vested right. [38]
The Court, however, notes that the Board members and full-time consultants received the
year-end benefit in good faith. The Board members relied on (1) Section 10 of RA No. 7227
which authorized the Board to adopt a compensation and benefit scheme; (2) the fact that RA
No. 7227 does not expressly prohibit Board members from receiving benefits other than
the per diem authorized by law; and (3) President Ramos approval of the new compensation
and benefit scheme which included the granting of a year-end benefit to each contractual
employee, regular permanent employee, and Board member. The full-time consultants relied
on Section 10 of RA No. 7227 which authorized the Board to adopt a compensation and
benefit scheme. There is no proof that the Board members and full-time consultants knew that
their receipt of the year-end benefit was unlawful. In keeping with Magno,[39] De
Jesus,[40] Molen, Jr.,[41] and Kapisanan ng mga Manggagawa sa Government Service
Insurance System (KMG) v. Commission on Audit,[42] the Board members and full-time
consultants are not required to refund the year-end benefits they have already received.
WHEREFORE, the petition is PARTIALLY GRANTED. Commission on Audit
Decision No. 2007-020 dated 12 April 2007 is AFFIRMED with theMODIFICATION that
the Board members and full-time consultants of the Bases Conversion and Development
Authority are not required to refund the year-end benefits they have already received.
SO ORDERED.
RESOLUTION
PER CURIAM:
It is said that a little learning is a dangerous thing; and that he who acts as his own
lawyer has a fool for a client. There would seem to be more than a grain of truth in
these aphorisms; and they appear to find validation in the proceeding at bench, at
least.
The respondent in this case, Joaquin T. Borromeo, is not a lawyer but has apparently
read some law books, and ostensibly come to possess some superficial awareness of
a few substantive legal principles and procedural rules. Incredibly, with nothing more
than this smattering of learning, the respondent has, for some sixteen (16) years now,
from 1978 to the present, been instituting and prosecuting legal proceedings in
various courts, dogmatically pontificating on errors supposedly committed by the
courts, including the Supreme Court. In the picturesque language of former Chief
Justice Enrique M. Fernando, he has "with all the valor of ignorance," 1 been verbally
jousting with various adversaries in diverse litigations; or in the words of a well-known
song, rushing into arenas "where angels fear to tread." Under the illusion that his
trivial acquaintance with the law had given him competence to undertake litigation, he
has ventured to represent himself in numerous original and review proceedings.
Expectedly, the results have been disastrous. In the process, and possibly in aid of
his interminable and quite unreasonable resort to judicial proceedings, he has seen fit
to compose and circulate many scurrilous statements against courts, judges and their
employees, as well as his adversaries, for which he is now being called to account.
Respondent Borromeo's ill-advised incursions into lawyering were generated by fairly
prosaic transactions with three (3) banks which came to have calamitous
consequences for him chiefly because of his failure to comply with his contractual
commitments and his stubborn insistence on imposing his own terms and conditions
for their fulfillment. These banks were: Traders Royal Bank (TRB), United Coconut
Planters Bank (UCPB), Security Bank & Trust Co. (SBTC). Borromeo obtained loans
or credit accommodation from them, to secure which he constituted mortgages over
immovables belonging to him or members of his family, or third persons. He failed to
pay these obligations, and when demands were made for him to do so, laid down his
own terms for their satisfaction which were quite inconsistent with those agreed upon
with his obligees or prescribed by law. When, understandably, the banks refused to
let him have his way, he brought suits right and left, successively if not
contemporaneously, against said banks, its officers, and even the lawyers who
represented the banks in the actions brought by or against him. He sued, as well, the
public prosecutors, the Judges of the Trial Courts, and the Justices of the Court of
Appeals and the Supreme Court who at one time or another, rendered a judgment,
resolution or order adverse to him, as well as the Clerks of Court and other Court
employees signing the notices thereof. In the aggregate, he has initiated or spawned
in different fora the astounding number of no less-than fifty (50) original or review
proceedings, civil, criminal, administrative. For some sixteen (16) years now, to
repeat, he has been continuously cluttering the Courts with his repetitive, and quite
baseless if not outlandish complaints and contentions.
G.R.
On October 29, 1982 Borromeo filed a complaint in the Cebu City Regional Trial
Court for specific performance and damages against TRB and its local manager, Blas
Abril, docketed as Civil Case No. R-22506. The complaint sought to compel
defendants to allow redemption of the foreclosed properties only at their auction price,
with stipulated interests and charges, without need of paying the obligation secured
by the trust receipt above mentioned. Judgment was rendered in his favor on
December 20, 1984 by Branch 23 of the Cebu City RTC; but on defendants' appeal to
the Court of Appeals docketed as CA-G.R. CV No. 07015 the judgment was
reversed, by decision dated January 27, 1988. The Court of Appeals held that the
"plaintiff (Borromeo) has lost his right of redemption and can no longer compel
defendant to allow redemption of the properties in question."
Borromeo elevated the case to this court where his appeal was docketed as G.R. No.
83306. By Resolution dated August 15, 1988, this Court's First Division denied his
petition for review "for failure . . . to sufficiently show that the respondent Court of
Appeals had committed any reversible error in its questioned judgment, it appearing
on the contrary that the said decision is supported by substantial evidence and is in
accord with the facts and applicable law." Reconsideration was denied, by Resolution
dated November 23, 1988. A second motion for reconsideration was denied by
Resolution dated January 30, 1989, as was a third such motion, by Resolution dated
April 19, 1989. The last resolution also directed entry of judgment and the remand of
the case to the court of origin for prompt execution of judgment. Entry of judgment
was made on May 12, 1989. By Resolution dated August 7, 1989, the Court denied
another motion of Borromeo to set aside judgment; and by Resolution dated
December 20, 1989, the Court merely noted without action his manifestation and
motion praying that the decision of the Court of Appeals be overturned, and declared
that "no further motion or pleading . . . shall be entertained . . . ."
2.
RTC
Case
CA-G.R. SP No. 22356
No. CEB
8750;
The ink was hardly dry on the resolutions just mentioned before Borromeo initiated
another civil action in the same Cebu City Regional Court by which he attempted to
litigate the same issues. The action, against the new TRB Branch Manager, Jacinto
Jamero, was docketed as Civil Case No. CEB-8750. As might have been anticipated,
the action was, on motion of the defense, dismissed by Order dated May 18,
3
1990, on the ground ofres judicata, the only issue raised in the second action i.e.,
Borromeo's right to redeem the lots foreclosed by TRB having been ventilated in
Civil Case No. R-22506 (Joaquin T. Borromeo vs. Blas C. Abril and Traders Royal
Bank) (supra) and, on appeal, decided with finality by the Court of Appeals and the
Supreme Court in favor of defendants therein.
The Trial Court's judgment was affirmed by the Court of Appeals in CA-G.R. SP No.
22356.
3.
RTC
Case
CA-G.R. SP No. 28221
No. CEB-9485;
In the meantime, and during the pendency of Civil Case No. R-22506, TRB
consolidated its ownership over the foreclosed immovables. Contending that act of
consolidation amounted to a criminal offense, Borromeo filed complaints in the Office
of the City Prosecutor of Cebu against the bank officers and lawyers. These
complaints were however, and quite correctly, given short shrift by that Office.
Borromeo then filed suit in the Cebu City RTC, this time not only against the TRB,
TRB officers Jacinto Jamero and Arceli Bustamante, but also against City Prosecutor
Jufelinito Pareja and his assistants, Enriqueta Belarmino and Eva A. Igot, and the
TRB lawyers, Mario Ortiz and the law, firm, HERSINLAW. The action was docketed
as Civil Case No. CEB-9485. The complaint charged Prosecutors Pareja, Belarmino
and Igot with manifest partiality and bias for dismissing the criminal cases just
mentioned; and faulted TRB and its manager, Jamero, as well as its lawyers, for
consolidating the titles to the foreclosed properties in favor of the bank despite the
pendency of Case No. R-22506. This action also failed. On defendants' motion, it was
dismissed on February 19, 1992 by the RTC. (Branch 22) on the ground of res
judicata(being identical with Civil Case Nos. R-22506 and CEB-8750, already decided
with finality in favor of TRB), and lack of cause of action (as to defendants Pareja,
Belarmino and Igot).
Borromeo's certiorari petition to the Court of Appeals (CA G.R. SP No. 28221) was
dismissed by that Court's 16th Division 4 on October 6, 1992, for the reason that the
proper remedy was appeal.
4.
RTC
Case
CA-G.R. SP No. 27100
No. CEB-10368;
Before Case No. CEB-9845 was finally decided, Borromeo filed, on May 30, 1991, still
another civil action for the same cause against TRB, its manager, Jacinto Jamero,
and its lawyers, Atty. Mario Ortiz and the HERSINLAW law office. This action was
docketed as Civil Case No. CEB-10368, and was described as one for "Recovery of
Sums of Money, Annulment of Titles with Damages." The case met the same fate as
the others. It was, on defendants' motion, dismissed on September 9, 1991 by the
5
RTC (Branch 14 ) on the ground of litis pendentia.
The RTC ruled that
Civil Case No. CEB-9485 will readily show that the defendants
therein, namely the Honorable Jufelinito Pareja, Enriqueta
Belarmino, Eva Igot, Traders Royal Bank, Arceli Bustamante,
Jacinto Jamero, Mario Ortiz and HERSINLAW are the same
persons or nearly all of them who are impleaded as defendants in
the present Civil Case No. CEB-10368, namely, the Traders Royal
Bank, Jacinto Jamero, Mario Ortiz and HERSINLAW. The only
difference is that more defendants were impleaded in Civil Case
No. CEB-9485, namely, City Prosecutor Jufelinito Pareja and his
assistants Enriqueta Belarmino and Eva Igot. The inclusion of the
City Prosecutor and his two assistants in Civil Case No. CEB-9485
was however merely incidental as apparently they had nothing to
do with the questioned transaction in said case. . . .
The Court likewise found that the reliefs prayed for were the same as those sought in
Civil Case No. CEB-9485, and the factual bases of the two cases were essentially the
same the alleged fraudulent foreclosure and consolidation of the three properties
mortgaged years earlier by Borromeo to TRB.
For some reason, the Order of September 9, 1991 was set aside by an Order
rendered by another Judge on November 11, 1991 6 the Judge who previously
heard the case having inhibited himself; but this Order of November 11, 1991 was, in
turn, nullified by the Court of Appeals (9th Division), by Decision promulgated on
March 31, 1992 in CA-G.R. SP No. 27100 (Traders Royal Bank vs. Hon. Celso M.
7
Gimenez, etc. and Joaquin T. Borromeo), which decision also directed dismissal of
Borromeo's complaint.
5. RTC Case No. CEB-6452
When a new branch manager, Ronald Sy, was appointed for TRB, Cebu City,
Borromeo forthwith made that event the occasion for another new action, against
TRB, Ronald Sy, and the bank's attorneys Mario Ortiz, Honorato Hermosisima, Jr.,
Wilfredo Navarro and HERSINLAW firm. This action was docketed as Civil Case No.
CEB-6452, and described as one for "Annulment of Title with Damages." The
complaint, dated October 20, 1987, again involved the foreclosure of the three (3)
immovables above mentioned, and was anchored on the alleged malicious, deceitful,
and premature consolidation of titles in TRB's favor despite the pendency of Civil
8
Case No. 22506. On defendant's motion, the trial court dismissed the case on the
ground of prematurity, holding that "(a)t this point . . ., plaintiff's right to seek
annulment of defendant Traders Royal Bank's title will only accrue if and when
plaintiff will ultimately and finally win Civil Case No. R-22506."
6. RTC Case No. CEB-8236
Having thus far failed in his many efforts to demonstrate to the courts the "merit" of
his cause against TRB and its officers and lawyers, Borromeo now took a different
tack by also suing (and thus also venting his ire on) the members of the appellate
courts who had ruled adversely to him. He filed in the Cebu City RTC, Civil Case No.
CEB-8236, impleading as defendants not only the same parties he had theretofore
been suing TRB and its officers and lawyers (HERSINLAW, Mario Ortiz) but
also the Chairman and Members of the First Division of the Supreme Court who had
repeatedly rebuffed him in G.R. No. 83306 (SEE sub-head I, A, 1, supra), as well as
the Members of the 5th, 9th and 10th Divisions of the Court of Appeals who had
likewise made dispositions unfavorable to him. His complaint, dated August 22, 1989,
aimed to recover damages from the defendants Justices for
. . . maliciously and deliberately stating blatant falsehoods and
disregarding evidence and pertinent laws, rendering manifestly
unjust and biased resolutions and decisions bereft of signatures,
facts or laws in support thereof, depriving plaintiff of his cardinal
rights to due process and against deprivation of property without
said process, tolerating, approving and legitimizing the patently
illegal, fraudulent, and contemptuous acts of defendants TRB,
(which) constitute a) GRAVE DERELICTION OF DUTY AND
ABUSE OF POWER emanating from the people, b) FLAGRANT
VIOLATIONS OF THE CONSTITUTION, CARDINAL PRIMARY
RIGHTS DUE PROCESS, ART. 27, 32, CIVIL CODE, Art. 208,
REV. PENAL CODE, and R.A. 3019, for which defendants must be
held liable under said laws.
The complaint also prayed for reconveyance of the "fake titles obtained fraudulently
by TRB/HERSINLAW," and recovery of "100,000.00 moral damages; 30,000.00
exemplary damages; and P5,000.00 litigation expenses." This action, too, met a quick
and unceremonious demise. On motion of defendants TRB and HERSINLAW, the
trial court, by Order dated November 7, 1989, 9 dismissed the case.
7. RTC Case No. CEB-13069
It appears that Borromeo filed still another case to litigate the same cause subject of
two (2) prior actions instituted by him. This was RTC Case No. CEB-13069, against
TRB and the latter's lawyers, Wilfredo Navarro and Mario Ortiz. The action was
10
dismissed in an Order dated October 4, 1993, on the ground of res judicata the
subject matter being the same as that in Civil Case No. R-22506, decision in which
was affirmed by the Court of Appeals in CA-G.R. CV No. 07015 as well as by this
Court in G.R. No. 83306 11 and litis pendentia the subject matter being also the
same as that in Civil Case No. CEB-8750, decision in which was affirmed by the
12
Court of Appeals in CA G.R. SP No. 22356.
8. RTC Criminal Case No. CBU-19344;
CA-G.R. SP No. 28275; G.R. No. 112928
On April 17, 1990 the City Prosecutor of Cebu City filed an information with the RTC
of Cebu (Branch 22) against Borromeo charging him with a violation of the Trust
13
Receipts Law. The case was docketed as Criminal Case No. CBU-19344. After a
while, Borromeo moved to dismiss the case on the ground of denial of his right to a
speedy trial. His motion was denied by Order of Judge Pampio A. Abarintos dated
April 10, 1992. In the same order, His Honor set an early date for Borromeo's
arraignment and placed the case "under a continuous trial system on the dates as
may be agreed by the defense and prosecution." Borromeo moved for
reconsideration. When his motion was again found without merit, by Order dated May
21, 1992, he betook himself to the Court of Appeals on a special civil action
of certiorari, to nullify these adverse orders, his action being docketed as CA-G.R. SP
No. 28275.
Here again, Borromeo failed. The Court of Appeals declared that the facts did not
show that there had been unreasonable delay in the criminal action against him, and
14
denied his petition for being without merit.
Borromeo then filed a petition for review with this Court (G.R. No. 112928), but by
resolution dated January 31, 1994, the same was dismissed for failure of Borromeo to
comply with the requisites of Circulars Numbered 1-88 and 19-91. His motion for
reconsideration was subsequently denied by Resolution dated March 23, 1994.
a.
Clarificatory
Communications
Borromeo Re "Minute Resolutions"
to
He next filed a Manifestation dated April 6, 1994 calling the Resolution of March 23,
1994 "Un-Constitutional, Arbitrary and tyrannical and a gross travesty of 'Justice,'"
because it was "signed only by a mere clerk and . . . (failed) to state clear facts and
law," and "the petition was not resolved on MERITS nor by any Justice but by a mere
15
clerk."
The Court responded with another Resolution, promulgated on June 22, 1994, and
with some patience drew his attention to the earlier resolution "in his own previous
case (Joaquin T. Borromeo vs. Court of Appeals and Samson Lao, G.R. No. 82273, 1
16
June 1990; 186 SCRA 1) and on the same issue he now raises." Said Resolution of
June 22, 1994, after reiterating that the notices sent by the Clerk of Court of the
Court En Banc or any of the Divisions simply advise of and quote the resolution
actually adopted by the Court after deliberation on a particular matter, additionally
stated that Borromeo "knew, as well, that the communications (notices) signed by the
Clerk of Court start with the opening clause
Quoted hereunder, for your information, is a resolution of the First
Division of this Court dated. _________,
thereby indisputably showing that it is not the Clerk of Court who prepared or signed
the resolutions."
This was not, by the way, the first time that the matter had been explained to
Borromeo. The record shows that on July 10, 1987, he received a letter from Clerk of
Court Julieta Y. Carreon (of this Court's Third Division) dealing with the subject, in
relation to G.R. No. 77243. 17 The same matter was also dealt with in the letter
received by him from Clerk of Court Luzviminda D. Puno, dated April 4, 1989, and in
the letter to him of Clerk of Court (Second Division) Fermin J. Garma, dated May 19,
18
1989. And the same subject was treated of in another Resolution of this Court,
notice of which was in due course served on him, to wit: that dated July 31, 1989, in
G.R. No. 87897. 19
B. CRIMINAL CASES
Mention has already been made of Borromeo's attempt with "all the valor of
ignorance" to fasten not only civil, but also criminal liability on TRB, its officers and
lawyers. 20 Several other attempts on his part to cause criminal prosecution of those
he considered his adversaries, will now be dealt with here.
1. I. S. Nos. 90-1187 and 90-1188
On March 7, 1990, Borromeo filed criminal complaints with the Office of the Cebu City
Prosecutor against Jacinto Jamero (then still TRB Branch Manager), "John Doe and
officers of Traders Royal Bank." The complaints (docketed as I.S. Nos. 90-1187-88)
accused the respondents of "Estafa and Falsification of Public Documents." He
claimed, among others that the bank and its officers, thru its manager, Jacinto
Jamero, sold properties not owned by them: that by fraud, deceit and false pretenses,
respondents negotiated and effected the purchase of the (foreclosed) properties from
his (Borromeo's) mother, who "in duress, fear and lack of legal knowledge," agreed to
the sale thereof for only P671,000.00, although in light of then prevailing market
prices, she should have received P588,030.00 more.
In a Joint Resolution dated April 11, 1990, 21 the Cebu City Fiscal's office dismissed
the complaints observing that actually, the Deed of Sale was not between the bank
and Borromeo's mother, but between the bank and Mrs. Thakuria (his sister), one of
the original owners of the foreclosed properties; and that Borromeo, being a stranger
to the sale, had no basis to claim injury or prejudice thereby. The Fiscal ruled that the
bank's ownership of the foreclosed properties was beyond question as the matter had
been raised and passed upon in a judicial litigation; and moreover, there was no proof
of the document allegedly falsified nor of the manner of its falsification.
3. OMB-VIS-89-00136
This Resolution of this Court (First Division) in G.R. No. 83306 dated August 15, 1988
sustaining the judgment of the Court of Appeals (10th Division) of January 27,
1988 in CA-G.R. CV No. 07015, supra, was made the subject of a criminal complaint
by Borromeo in the Office of the Ombudsman, Visayas, docketed as OMB-VIS-8900136. His complaint against "Supreme Court Justice (First Div.) and Court of
Appeals Justice (10th Div)" was dismissed for lack of merit in a Resolution issued
on February 14, 1990 25 which, among other things, ruled as follows:
It should be noted and emphasized that complainant has remedies
available under the Rules of Court, particularly on civil procedure
and existing laws. It is not the prerogative of this Office to make a
review of Decisions and Resolutions of judicial courts, rendered
within their competence. The records do not warrant this Office to
take further proceedings against the respondents.
In addition, Sec. 20. of R.A. 6770, "the Ombudsman Act states that
the Office of the Ombudsman may not conduct the necessary
investigation of any administrative act or omission complained of if
it believes that (1) the complainant had adequate remedy in another
judicial or quasi-judicial body;" and Sec. 21 the same law provides
that the Office of the Ombudsman does not have disciplinary
authority over members of the Judiciary.
II. CASES INVOLVING UNITED COCONUT
PLANTERS BANK (UCPB)
26
Following the same aberrant pattern of his judicial campaign against Traders Royal
Bank, Borromeo attempted to vent his resentment even against the Supreme Court
officers who, as just stated, had given him notices of the adverse dispositions of this
Court's Third Division. He filed Civil Case No. CEB-8679 in the Cebu City RTC (CFI)
for recovery of damages against "Attys. Julieta Y. Carreon and Alfredo Marasigan,
Division Clerk of Court and Asst. Division Clerk of Court, Third Division, and Atty.
Jose I. Ilustre, Chief of Judicial Records Office." He charged them with usurpation of
judicial functions, for allegedly "maliciously and deviously issuing biased, fake,
baseless and unconstitutional 'Resolution' and 'Entry of Judgment' in G.R. No.
82273."
27
The Resolution of June 1, 1990 explained to Borromeo in no little detail the nature
and purpose of notices sent by the Clerks of Court of decisions or resolutions of the
Court En Banc or the Divisions, in this wise:
This is not the first time that Mr. Borromeo has filed
charges/complaints against officials of the Court. In several letter
complaints filed with the courts and the Ombudsman, Borromeo
had repeatedly alleged that he "suffered injustices," because of the
disposition of the four (4) cases he separately appealed to this
Court which were resolved by minute resolutions, allegedly in
violation of Sections 4 (3), 13 and 14 of Article VIII of the 1987
Constitution. His invariable complaint is that the resolutions which
disposed of his cases do not bear the signatures of the Justices
who participated in the deliberations and resolutions and do not
show that they voted therein. He likewise complained that the
resolutions bear no certification of the Chief Justice and that they
did not state the facts and the law on which they were based and
were signed only by the Clerks of Court and therefore
"unconstitutional, null and void."
xxx xxx xxx
The Court reminds all lower courts, lawyers, and litigants that it
disposes of the bulk of its cases by minute resolutions and decrees
them as final and executory, as were a case is patently without
merit, where the issues raised are factual in nature, where the
decision appealed from is in accord with the facts of the case and
the applicable laws, where it is clear from the records that the
NO. CEB-(6501)
It is now necessary to digress a little and advert to actions which, while having no
relation to the UCPB, TRB or SBTC, are relevant because they were the predicates
for other suits filed by Joaquin Borromeo against administrative officers of the
Supreme Court and the Judge who decided one of the cases adversely to him.
The record shows that on or about December 11, 1987, Borromeo filed a civil action
for damages against a certain Thomas B. Tan and Marjem Pharmacy, docketed as
Civil Case No. CEB-6501. On January 12, 1988, the trial court dismissed the case,
without prejudice, for failure to state a cause of action and prematurity (for noncompliance with P.D. 1508).
What Borromeo did was simply to re-file the same complaint with the same Court, on
March 18, 1988. This time it was docketed as Civil Case No. CEB-6740, and
assigned to Branch 17 of the RTC of Cebu presided by Hon. Mario Dizon. Again,
however, on defendants' motion, the trial court dismissed the case, in an order dated
May 28, 1988. His first and second motions for reconsideration having been denied,
Borromeo filed a petition for review before this Court, docketed as G.R. No. 84054
(Joaquin T. Borromeo vs. Tomas Tan and Non. Mario Dizon).
In a Resolution dated August 3, 1988, the Court required petitioner to comply with the
rules by submitting a verified statement of material dates and paying the docket and
legal research fund fees; it also referred him to the Citizens Legal Assistance Office
for help in the case. His petition was eventually dismissed by Resolution of the
Second Division dated November 21, 1988, for failure on his part to show any
reversible error in the trial court's judgment. His motion for reconsideration was
denied with finality, by Resolution dated January 18, 1989.
Borromeo wrote to Atty. Fermin J. Garma (Clerk of Court of the Second Division) on
April 27, 1989 once more remonstrating that the resolutions received by him had not
been signed by any Justice, set forth no findings of fact or law, and had no
certification of the Chief Justice. Atty. Garma replied to him on May 19, 1989, pointing
out that "the minute resolutions of this Court denying dismissing petitions, like the
petition in the case at bar, which was denied for failure of the counsel and/or
petitioner to sufficiently show that the Regional Trial Court of Cebu, Branch 17, had
committed any reversible error in the questioned judgment [resolution dated
November 21, 1988], are the result of a thorough deliberation among the members of
this Court, which does not and cannot delegate the exercise of its judicial function to
its Clerk of Court or any of its subalterns. When the petition is denied or dismissed by
the Court, it sustains the challenged decision or order together with its findings of
facts and legal conclusions."
Borromeo obviously had learned nothing from the extended Resolution of June 1,
1990 in G.R. No. 82273, supra(or the earlier communications to him on the same
subject) which had so clearly pointed out that minute resolutions of the Court are as
much the product of the Members' deliberations as full-blown decisions or resolutions,
and that the intervention of the Clerk consists merely in the ministerial and routinary
function of communicating the Court's action to the parties concerned.
c. RTC Case No. CEB-9042
What Borromeo did next, evidently smarting from this latest judicial rebuff, yet another
in an already long series, was to commence a suit against Supreme Court (Second
Division) Clerk of Court Fermin J. Garma and Assistant Clerk of Court Tomasita Dris.
They were the officers who had sent him notices of the unfavorable resolutions in
G.R. No. 84054, supra. His suit, filed on June 1, 1990, was docketed as Case No.
CEB-9042 (Branch 8, Hon. Bernardo Salas presiding). Therein he complained
essentially of the same thing he had been harping on all along: that in relation to G.R.
No. 91030 in which the Supreme Court dismissed his petition for "technical
reasons" and failure to demonstrate any reversible error in the challenged judgment
the notice sent to him of the "unsigned and unspecific" resolution of February
19, 1990, denying his motion for reconsideration had been signed only by the
defendant clerks of court and not by the Justices. According to him, he had thereupon
written letters to defendants demanding an explanation for said "patently unjust and
un-Constitutional resolutions," which they ignored; defendants had usurped judicial
functions by issuing resolutions signed only by them and not by any Justice, and
without stating the factual and legal basis thereof; and defendants' "wanton, malicious
and patently abusive acts" had caused him "grave mental anguish, severe moral
shock, embarrassment, sleepless nights and worry;" and consequently, he was
entitled to moral damages of no less than P20,000.00 and exemplary damages of
P10,000.00, and litigation expenses of P5,000.00.
On June 8, 1990, Judge Renato C. Dacudao ordered the records of the case
transmitted to the Supreme Court conformably with its Resolution dated June 1, 1990
in G.R. No. 82273, entitled "Joaquin T. Borromeo vs. Hon. Court of Appeals and
Samson-Lao," supra directing that all complaints against officers of that Court be
28
forwarded to it for appropriate action.
Borromeo filed a "Manifestation/Motion" dated June 27, 1990 asking the Court to
"rectify the injustices" committed against him in G.R. Nos. 83306, 84999, 87897,
77248 and 84054. This the Court ordered expunged from the record (Resolution, July
19, 1990).
2.
RTC
Case
No. R-21880; CA-G.R.
CV No. 10951; G.R. No. 87897
Borromeo also sued to stop UCPB from foreclosing the mortgage on his property. In
the Cebu City RTC, he filed a complaint for "Damages with Injunction," which was
docketed as Civil Case No. R-21880 (Joaquin T. Borromeo vs. United Coconut
Planters Bank, et al.). Named defendants in the complaint were UCPB, Enrique
Farrarons(UCPB Cebu Branch Manager) and Samson K. Lao. UCPB was
represented in the action by Atty. Danilo Deen, and for a time, by Atty. Honorato
Hermosisima (both being then resident partners of ACCRA Law Office). Lao was
represented by Atty. Antonio Regis. Once again, Borromeo was rebuffed. The Cebu
RTC (Br. 11, Judge Valeriano R. Tomol, Jr. presiding) dismissed the complaint,
upheld UCPB's right to foreclose, and granted its counterclaim for moral damages in
the sum of P20,000.00; attorney's fees amounting to P10,000.00; and litigation
expenses of P1,000.00.
Borromeo perfected an appeal to the Court of Appeals where it was docketed as CAG.R. CV No. 10951. That Court, thru its Ninth Division (per Martinez, J., ponente, with
de la Fuente and Pe, JJ., concurring), dismissed his appeal and affirmed the Trial
Court's judgment.
Borromeo filed a petition far review with the Supreme Court which, in G.R. No. 87897
dismissed it for insufficiency in form and substance and for being "largely
unintelligible." Borromeo's motion for reconsideration was denied by Resolution dated
June 25, 1989. A second motion for reconsideration was denied in a Resolution dated
July 31, 1989 which directed as well entry of judgment (effected on August 1, 1989).
In this Resolution, the Court (First Division) said:
The Court considered the Motion for Reconsideration dated July 4,
1989 filed by petitioner himself and Resolved to DENY the same for
lack of merit, the motion having been filed without "express leave of
court" (Section 2, Rule 52, Rules of Court) apart from being a
reiteration merely of the averments of the Petition for Review dated
April 14, 1989 and the Motion for Reconsideration dated May 25,
1989. It should be noted that petitioner's claims have already been
twice rejected as without merit, first by the Regional Trial Court of
Cebu and then by the Court of Appeals. What petitioner desires
obviously is to have a third ruling on the merits of his claims, this
time by this Court. Petitioner is advised that a review of a decision
of the Court of Appeals is not a matter of right but of sound judicial
discretion and will be granted only when there is a special and
important reason therefor (Section 4, Rule 45); and a petition for
review may be dismissed summarily on the ground that "the appeal
is without merit, or is prosecuted manifestly for delay or the
question raised is too unsubstantial to require consideration"
(Section 3, Rule 45), or that only questions of fact are raised in the
petition, or the petition otherwise fails to comply with the formal
requisites prescribed therefor (Sections 1 and 2, Rule 45; Circular
No. 1-88). Petitioner is further advised that the first sentence of
Section 14, Article VIII of the 1987 Constitution refers to a decision,
and has no application to aresolution as to which said section
pertinently provides that a resolution denying a motion for
reconsideration need state only the legal basis therefor; and that
the resolution of June 26, 1989 denying petitioner's first Motion for
Reconsideration dated May 25, 1989 does indeed state the legal
reasons therefor. The plain and patent signification of the grounds
for denial set out in the Resolution of June 26, 1989 is that the
petitioner's arguments aimed at the setting aside of the
resolution denying the petition for review and consequently bringing
about a review of the decision of the Court of Appeals had failed
On August 13, 1989 Borromeo wrote to Atty. Estrella C. Pagtanac, then the Clerk of
Court of the Court's First Division, denouncing the resolution above mentioned as "a
LITANY OF LIES, EVASIONS, and ABSURD SELF-SERVING LOGIC from a
Supreme Court deluded and drunk with power which it has forgotten emanates from
the people," aside from being "patently UNCONSTITUTIONAL for absence of
signatures and facts and law: . . . and characterizing the conclusions therein as "the
height of ARROGANCE and ARBITRARINESS assuming a KING-LIKE AND EVEN
GOD-LIKE
POWER totally at variance and contradicted by . . . CONSTITUTIONAL provisions . .
." To the letter Borromeo attached copies of (1) his "Open Letter to the Ombudsman"
dated August 10, 1989 protesting the Court's "issuing UNSIGNED, UNSPECIFIC, and
BASELESS 'MINUTE RESOLUTIONS;'" (2) his "Open Letter of Warning" dated
August 12, 1989; and (3) a communication of Domingo M. Quimlat, News
Ombudsman, Phil. Daily Inquirer, dated August 10, 1989. His letter was ordered
expunged from the record because containing "false, impertinent and scandalous
matter (Section 5, Rule 9 of the Rules of Court)." Another letter of the same ilk, dated
November 7, 1989, was simply "NOTED without action" by Resolution promulgated
on December 13, 1989.
3.
RTC
Case
No. CEB-4852; CA
SP No. 14519; G.R. No. 84999
G.R.
In arrant disregard of established rule and practice, Borromeo filed another action to
invalidate the foreclosure effected at the instance of UCPB, which he had
unsuccessfully tried to prevent in Case No. CEB-21880. This was Civil Case No.
CEB-4852 of the Cebu City RTC (Joaquin T. Borromeo vs. UCPB, et al.) for
"Annulment of Title with Damages." Here, UCPB was represented by Atty. Laurence
Fernandez, in consultation with Atty. Deen.
On December 26, 1987, the Cebu City RTC (Br. VII, Hon. Generoso A. Juaban,
presiding) dismissed the complaint on the ground of litis pendentia and ordered
Borromeo to pay attorney's fees (P5,000.00) and litigation expenses (P1,000.00).
Borromeo instituted a certiorari action in the Court of Appeals to annul this judgment
(CA G.R. SP No. 14519); but his action was dismissed by the Appellate Court on
June 7, 1988 on account of his failure to comply with that Court's Resolution of May
13, 1988 for submission of certified true copies of the Trial Court's decision of
December 26, 1987 and its Order of February 26, 1988, and for statement of "the
dates he received . . . (said) decision and . . . order."
Borromeo went up to this Court on appeal, his appeal being docketed as G.R. No.
84999. In a Resolution dated October 10, 1988, the Second Division required
comment on Borromeo's petition for review by the respondents therein named, and
required Borromeo to secure the services of counsel. On November 9, 1988, Atty.
Jose L. Cerilles entered his appearance for Borromeo. After due proceedings,
Borromeo's petition was dismissed, by Resolution dated March 6, 1989 of the Second
Division for failure to sufficiently show that the Court of Appeals had committed any
reversible error in the questioned judgment. His motion for reconsideration dated April
4, 1989, again complaining that the resolution contained no findings of fact and law,
was denied.
a. RTC Case No. CEB-8178
Predictably, another action, Civil Case No. CEB-8178, was commenced by Borromeo
in the RTC of Cebu City, this time against the Trial Judge who had lately rendered
judgment adverse to him, Judge Generoso Juaban. Also impleaded as defendants
were UCPB, and Hon. Andres Narvasa (then Chairman, First Division), Estrella
G.Pagtanac and Marissa Villarama (then, respectively, Clerk of Court and Assistant
Clerk of Court of the First Division), and others. Judge German G. Lee of Branch 15
of said Court to which the case was raffled caused issuance of summonses
which were in due course served on September 22, 1989, among others, on said
defendants in and of the Supreme Court. In an En Banc Resolution dated October 2,
1989 in G.R. No. 84999 this Court, required Judge Lee and the Clerk of Court
and Assistant Clerk of Court of the Cebu RTC to show cause why no disciplinary
action should be taken against them for issuing said summonses.
sale thereof by Lao to Logarta. Borromeo appealed to the Court of Appeals, but that
Court, in CA-G.R. CV No. 04097, affirmed the Trial Court's judgment, by Decision
promulgated on October 10, 1986.
Borromeo came up to this Court. on appeal, his review petition being docketed as
G.R. No. 77248. By Resolution of the Second Division of March 16, 1987, however,
his petition was denied for the reason that "a) the petition as well as the docket and
legal research fund fees were filed and paid late; and (b) the issues raised are factual
and the findings thereon of the Court of Appeals are final." He moved for
reconsideration; this was denied by Resolution dated June 3, 1987.
He thereafter insistently and persistently still sought reconsideration of said adverse
resolutions through various motions and letters, all of which were denied. One of his
letters inter alia complaining that the notice sent to him by the Clerk of Court did
not bear the signature of any Justice elicited the following reply from Atty. Julieta Y.
Carreon, Clerk of Court of the Third Division, dated July 10, 1987, reading as follows:
Dear Mr. Borromeo:
This refers to your letter dated June 9, 1987 requesting for a copy
of the actual resolution with the signatures of all the Justices of the
Second Division in Case G.R. No. 77243 whereby the motion for
reconsideration of the dismissal of the petition was denied for lack
of merit.
Shortly thereafter, Atty. Jose L. Cerilles who, as already stated, had for a time
represented Borromeo in G.R. No. 84999 filed with this Court his withdrawal of
appearance, alleging that there was "no compatibility" between him and his client,
Borromeo because "Borromeo had been filing pleadings, papers; etc. without . . .
(his) knowledge and advice" and declaring that he had "not advised and . . . (had)
no hand in the filing of (said) Civil Case CEB 8178 before the Regional Trial Court in
Cebu. On the other hand, Judge Lee, in his "Compliance" dated October 23, 1989,
apologized to the Court and informed it that he had already promulgated an order
dismissing Civil Case No. CEB-8178 on motion of the principal defendants therein,
namely, Judge Generoso Juaban and United Coconut Planters Bank (UCPB). Atty.
Cerilles' withdrawal of appearance, and Judge Lee's compliance, were noted by the
Court in its Resolution dated November 29, 1989.
4.
RTC
Case
No. CEB-374; CA-G.R.
CV No. 04097; G.R. No. 77248
JULIETA Y. CARREON
B. CRIMINAL CASES
Just as he had done with regard to the cases involving the Traders Royal Bank, and
similarly without foundation, Borromeo attempted to hold his adversaries in the cases
concerning the UCPB criminally liable.
No. CEB-10458;
Nothing daunted, and running true to form, Borromeo filed on July 2, 1991 still
another suit against the same parties SBTC, HERSINLAW, and Judge Caares
34
but now including Judge Godardo Jacinto, who had rendered the latest judgment
against him. This suit, docketed as Civil Case No. CEB-10458, was, according to
Borromeo, one "for Damages (For Unjust Judgment and Orders, Denial of Equal
Protection of the Laws Violation of the Constitution, Fraud and Breach of Contract)."
Borromeo faulted Judges Caares and Jacinto "for the way they decided the two
cases (CVR-21615 & CEB NO. 9267)," and contended that defendants committed
"wanton, malicious, and unjust acts" by "conniving to defraud plaintiff and deny him
equal protection of the laws and due process," on account of which he had been
"caused untold mental anguish, moral shock, worry, sleepless nights, and
embarrassment for which the former are liable under Arts. 20, 21, 27, and 32 of the
Civil Code."
The defendants filed motions to dismiss. By Order dated August 30, 1991, the RTC of
Cebu City, Branch 15 (Judge German G. Lee, Jr., presiding) dismissed the complaint
on grounds of res judicata, immunity of judges from liability in the performance of their
official functions, and lack of jurisdiction.
Borromeo took an appeal to the Court of Appeals, which docketed it as CA-G.R. CV
No. 39047.
In the course thereof, he filed motions to cite Atty. Wilfredo F. Navarro, lawyer of
SBTC, for contempt of court. The motions were denied by Resolution of the Court of
35
Appeals (Special 7th Division) dated April 13, 1993. Said the Court:
Stripped of their disparaging and intemperate innuendoes, the
subject motions, in fact, proffer nothing but a stark difference in
opinion as to what can, or cannot, be considered res judicata under
the circumstances.
xxx xxx xxx
By their distinct disdainful tenor towards the appellees, and his
apparent penchant for argumentum ad hominen, it is, on the
contrary the appellant who precariously treads the acceptable limits
of argumentation and personal advocacy. The Court, moreover,
takes particular note of the irresponsible leaflets he admits to have
authored and finds them highly reprehensible and needlessly
derogatory to the dignity, honor and reputation of the Courts. That
he is not a licensed law practitioner is, in fact, the only reason that
his otherwise contumacious behavior is presently accorded the
patience and leniency it probably does not deserve. Considering
complaint "on grounds of lack of jurisdiction and res judicata." His Honor made the
following pertinent observations:
. . . (T)his Court is of the well-considered view and so holds that this
Court has indeed no jurisdiction to review, interpret or reverse the
judgment or order of the Honorable Supreme Court. The acts or
omissions complained of by the plaintiff against the herein
defendant and the other personnel of the highest Court of the land
as alleged in paragraphs 6 to 12 of plaintiff's complaint are certainly
beyond the sphere of this humble court to consider and pass upon
to determine their propriety and legality. To try to review, interpret
or reverse the judgment or order of the Honorable Supreme Court
would appear not only presumptuous but also contemptuous. As
argued by the lawyer for the defendant, a careful perusal of the
allegations in the complaint clearly shows that all material
allegations thereof are directed against a resolution of the Supreme
Court which was allegedly issued by the Third Division composed
of five (5) justices. No allegation is made directly against defendant
Marcelo B. Fernan in his personal capacity. That being the case,
how could this Court question the wisdom of the final order or
judgment of the Supreme Court (Third Division) which according to
the plaintiff himself had issued a resolution denying plaintiffs
petition and affirming the Lower Court's decision as reflected in the
"Entry of Judgment." Perhaps, if there was such violation of the
Rules of Court, due process and Sec. 14, Art. 8 of the Constitution
by the defendant herein, the appropriate remedy should not have
been obtained before this Court. For an inferior court to reverse,
interpret or review the acts of a superior court might be construed to
a certain degree as a show of an uncommon common sense.
Lower courts are without supervising jurisdiction to interpret or to
reverse the judgment of the higher courts.
Borromeo's motion for reconsideration dated September 20, 1994 was denied "for
lack of sufficient factual and legal basis" by an Order dated November 15, 1994.
V. ADMINISTRATIVE CASE No. 3433
A. Complaint Against Lawyers
of his Court Adversaries
Borromeo also initiated administrative disciplinary proceedings against the lawyers
who had appeared for his adversaries UCPB and Samson K. Lao in the actions
above mentioned, and others. As already mentioned, these lawyers were: Messrs.
Laurence Fernandez, Danilo Deen, Honorato Hermosisima, Antonio Regis, and
Alfredo Perez. His complaint against them, docketed as Administrative Case No.
3433, prayed for their disbarment. Borromeo averred that the respondent lawyers
connived with their clients in (1) maliciously misrepresenting a deed of sale with pacto
de retro as a genuine sale, although it was actually an equitable mortgage; (2)
fraudulently depriving complainant of his proprietary rights subject of the Deed of
Sale; and (3) defying two lawful Court orders, all in violation of their lawyer's oath to
do no falsehood nor consent to the doing of any in Court. Borromeo alleged that
respondents Perez and Regis falsely attempted to consolidate title to his property in
favor of Lao.
B. Answer of Respondent Lawyers
The respondent lawyers denounced the disbarment complaint as "absolutely
baseless and nothing but pure harassment." In a pleading dated July 10, 1990,
entitled "Comments and Counter Motion to Cite Joaquin Borromeo in Contempt of
Court;" July 10, 1990, filed by the Integrated Bar of the Philippines Cebu City Chapter,
signed by Domero C. Estenzo (President), Juliano Neri (Vice-President), Ulysses
Antonio C. Yap (Treasurer); Felipe B. Velasquez (Secretary), Corazon E. Valencia
(Director), Virgilio U. Lainid (Director), Manuel A. Espina (Director), Ildefonsa A.
Ybaez (Director), Sylvia G. Almase (Director), and Ana Mar Evangelista P. Batiguin
(Auditor). The lawyers made the following observations:
It is ironic. While men of the legal profession regard members of the
Judiciary with deferential awe and respect sometimes to the extent
of cowering before the might of the courts, here is a non-lawyer
who, with gleeful abandon and unmitigated insolence, has cast
aspersions and shown utter disregard to the authority and name of
the courts.
And lawyers included. For indeed, it is very unfortunate that here is
a non-lawyer who uses the instruments of justice to harass lawyers
and courts who crosses his path more especially if their actuations
do not conform with his whims and caprices.
Adverting to letters publicly circulated by Borromeo, inter alia charging then Chief
Justice Marcelo B. Fernan with supposed infidelity and violation of the constitution,
etc., the lawyers went on to say the following:
The conduct and statement of Borromeo against this Honorable
Court, and other members of the Judiciary are clearly and grossly
disrespectful, insolent and contemptuous. They tend to bring
dishonor to the Judiciary and subvert the public confidence on the
courts. If unchecked, the scurrilous attacks will undermine the
dignity of the courts and will result in the loss of confidence in the
country's judicial system and administration of justice.
. . . (S)omething should be done to protect the integrity of the courts
and the legal profession. So many baseless badmouthing have
been made by Borromeo against this Honorable Court and other
courts that for him to go scot-free would certainly be demoralizing to
members of the profession who afforded the court with all the
respect and esteem due them.
In another letter to Chief Justice Fernan, he observed that "3 years after EDSA, your
pledges have not been fulfilled. Injustice continues and as you said, the courts are
agents of oppression, instead of being saviours and defenders of the people. The
saddest part is that (referring again to minute resolutions) even the Supreme Court,
the court of last resort, many times, sanctions injustice and the trampling of the rule of
law and due process, and does not comply with the Constitution when it should be the
first to uphold and defend it . . . ." Another circulated letter of his, dated June 21, 1989
and captioned, "Open Letter to Supreme Court Justices Marcelo Fernan and Andres
Narvasa," repeated his plaint of having "been the victim of many . . . 'Minute
Resolutions' . . . which in effect sanction the theft and landgrabbing and arson of my
properties by TRADERS ROYAL BANK, UNITED COCONUT PLANTERS BANK,
AND one TOMAS B. TAN all without stating any FACT or LAW to support your
dismissal of . . . (my) cases, despite your firm assurances (Justice Fernan) that you
would cite me such facts or laws (during our talk in your house last March 12 1989);"
and that "you in fact have no such facts or laws but simply want to ram down a most
unjust Ruling in favor of a wrongful party. . . ."
In another flyer entitled in big bold letters, "A Gov't That Lies! Blatant attempt to fool
people!" he mentions what he regards as "The blatant lies and contradictions of the
Supreme Court, CA to support the landgrabbing by Traders Royal Bank of
Borromeos' Lands." Another flyer has at the center the caricature of a person, seated
on a throne marked Traders Royal Bank, surrounded by such statements as, "Sa
TRB para kami ay royalty. Nakaw at nakaw! Kawat Kawat! TRB WILL STEAL!" etc
Still another "circular" proclaims: "So the public may know: Supreme Court minute
resolutions w/o facts, law, or signatures violate the Constitution" and ends with the
admonition: "Supreme Court, Justice Fernan: STOP VIOLATING THE CHARTER." 38
One other "circular" reads:
SC,
NARVASA
CODDLERS
VIOLATOR OF LAWS
OF
TYRANTS!!!
CROOKS!
JOAQUIN T. BORROMEO
TYRANTS will never admit that they are tyrants. But their acts
speak for themselves! NARVASA & ASSOC: ANSWER AND
REFUTE THESE SERIOUS CHARGES OR RESIGN!!
IMPEACH NARVASA
ISSUING UNSIGNED, SWEEPING, UNCLEAR,
UNCONSTITUTIONAL
"MINUTE
RESOLUTIONS" VIOLATIVE OF SECS. 4(3), 14,
ART. 8, Constitution
VIOLATING RULES OF COURT AND DUE
PROCESS IN ORDERING CASE AGAINST SC
CLERKS (CEB-8679) DISMISSED DESPITE
THE LATTER'S FAILURE TO FILE PLEADINGS;
HENCE IN DEFAULT
CORRUPTION AND/OR GROSS IGNORANCE
OF
THE
LAW
IN
RULING,
THAT
CONSIGNATION IS NECESSARY IN RIGHT OF
REDEMPTION, CONTRADICTING LAW AND
SC'S OWN RULINGS TO ALLOW CRONY
BANK TRB TO STEALS LOTS WORTH P3
MILLION
CONDONING CRONY BANK UCPB'S
DEFIANCE OF TWO LAWFUL COURT
ORDERS AND STEALING OF TITLE OF
PROPERTY WORTH P4 MILLION
BEING JUDGE AND ACCUSED AT THE SAME
TIME AND PREDICTABLY EXONERATING
HIMSELF AND FELLOW CORRUPT JUSTICES
In response to the Resolution of July 22, 1993, Borromeo filed a Comment dated
August 27, 1993 in which he alleged the following:
1) the resolution of July 22, 1993 (requiring comment) violates the
Constitution which requires "signatures and concurrence of majority
of members of the High Court;" hence, "a certified copy duly signed
by Justices is respectfully requested;"
2) the Chief Justice and other Members of the Court should inhibit
themselves "since they cannot be the Accused and Judge at the
same time, . . . (and) this case should be heard by an impartial and
independent body;"
3) the letter of Atty. Legaspi "is not verified nor signed by members
of said (IBP Cebu Chapter) Board; . . . is vague, unspecific, and
sweeping" because failing to point out "what particular statements
in the circular are allegedly libelous and condemnable;" and does
not appear that Atty. Legaspi has authority to speak or file a
complaint "in behalf of those accused in the "libelous circular;"
4) in making the circular, he (Borromeo) "was exercising his rights
of freedom of speech, of expression, and to petition the government
for redress of grievances as guaranteed by the Constitution (Sec. 4,
Art. III) and in accordance with the accountability of public officials;"
the circular merely states the truth and asks for justice based on the
facts
and
the
law; . . . it is not libelous nor disrespectful but rather to be
commended and encouraged; . . . Atty. Legaspi . . . should specify
under oath which statements are false and lies;
5) he "stands by the charges in his circular and is prepared to
support them with pertinent facts, evidence and law;" and it is
"incumbent on the Hon. Chief Justice and members of the High
Court to either refute said charges or dispense the justice that they
are duty bound to dispense.
D. Resolution of September 30, 1993
After receipt of the comment, and desiring to accord Borromeo the fullest opportunity
to explain his side, and be reprsented by an attorney, the Court promulgated the
following Resolution on September 30, 1993, notice of which was again served on
him by the Office of the Clerk of Court.
. . . The return of service filed by Sheriff Jessie A. Belarmino, Office
of the Clerk of Court Regional Trial Court of Cebu City, dated
August 26, 1993, and the Comment of Joaquin Borromeo, dated
August 27, 1993, on the letter of President Manuel P. Legaspi of
the relator dated June 21, 1993, are both NOTED. After deliberating
on the allegations of said Comment, the Court Resolved to GRANT
circular," theorized that it is "incumbent on the said Justices to rectify their grave as
well as to dismiss Atty. Legaspi's baseless and false charges."
VII. THE COURT CONCLUSIONS
A. Respondent's Liability
for Contempt of Court
SO ORDERED.
E. Borromeo's Supplemental Comment
of October 15, 1992
Borromeo filed a "Supplemental Comment" dated October 15, 1992, reiterating the
arguments and allegations in his Comment of August 27, 1993, and setting forth
"additional arguments and amplification to . . . (said) Comment," viz.:
1) the IBP and Atty. Legaspi have failed "to specify and state under
oath the alleged 'libelous' remarks contained in the circular . . .;
(they should) be ordered to file a VERIFIED COMPLAINT . . .(failing
in which, they should) be cited in contempt of court for making false
charges and wasting the precious time of this Highest Court by
filing a baseless complaint;
2) the allegations in their circular are not libelous nor disrespectful
but "are based on the TRUTH and the LAW", namely:
a) "minute resolutions" bereft of signatures and
clear facts and laws are patent violations of Secs.
4(32), 13, 14, Art. VIII of the Constitution;
b) there is no basis nor thruth to this Hon. Court's
affirmation to the Appelate Court's ruling that the
undersigned "lost" his right of redemption price,
since no less than this Hon. Court has ruled in
many
rulings
that
CONSIGNATION
IS
UNNECESSARY in right of redemption;
c) this Hon. Court has deplorably condoned crony banks TRB and
UCPB's frauds and defiance of court orders in G.R. Nos. 83306 and
878997 and 84999.
F. Borromeo's "Manifestation" of
November 26, 1993
Borromeo afterwards filed a "Manifestation" under date of November 26, 1993,
adverting to "the failure of the IBP and Atty. Legaspi to substantiate his charges under
oath and the failure of the concerned Justices to refute the charges in the alledged
"libelous circular" and, construing these as "and admission of the thruth in said
Upon the indubitable facts on record, there can scarcely be any doubt of Borromeo's
guilt of contempt, for abuse of and interference with judicial rules and processes,
gross disrespect to courts and judges and improper conduct directly impeding,
obstructing and degrading the administration of justice. 44 He has stubbornly litigated
issues already declared to be without merit, obstinately closing his eyes to the many
rulings rendered adversely to him in many suits and proceedings, rulings which had
become final and executory, obdurately and unreasonably insisting on the application
of his own individual version of the rules, founded on nothing more than his personal
(and quite erroneous) reading of the Constitution and the law; he has insulted the
judges and court officers, including the attorneys appearing for his adversaries,
needlessly overloaded the court dockets and sorely tried the patience of the judges
and court employees who have had to act on his repetitious and largely unfounded
complaints, pleadings and motions. He has wasted the time of the courts, of his
adversaries, of the judges and court employees who have had the bad luck of having
to act in one way or another on his unmeritorious cases. More particularly, despite his
attention having been called many times to the egregious error of his theory that the
so-called "minute resolutions" of this Court should contain findings of fact and
conclusions of law, and should be signed or certified by the Justices promulgating the
same, 45 he has mulishly persisted in ventilating that self-same theory in various
proceedings, causing much loss of time, annoyance and vexation to the courts, the
court employees and parties involved.
1. Untenability of Proffered Defenses
The first defense that he proffers, that the Chief Justice and other Members of the
Court should inhibit themselves "since they cannot be the Accused and Judge at the
same time . . . (and) this case should be heard by an impartial and independent body,
is still another illustration of an entirely unwarranted, arrogant and reprehensible
assumption of a competence in the field of the law: he again uses up the time of the
Court needlessly by invoking an argument long since declared and adjudged to be
untenable. It is axiomatic that the "power or duty of the court to institute a charge for
contempt against itself, without the intervention of the fiscal or prosecuting officer, is
essential to the preservation of its dignity and of the respect due it from litigants,
lawyers and the public. Were the intervention of the prosecuting officer required and
judges obliged to file complaints for contempts against them before the prosecuting
officer, in order to bring the guilty to justice, courts would be inferior to prosecuting
officers and impotent to perform their functions with dispatch and absolute
independence. The institution of charges by the prosecuting officer is not necessary
to hold persons guilty of civil or criminal contempt amenable to trial and punishment
by the court. All that the law requires is that there be a charge in writing duly filed in
court and an opportunity to the person charged to be heard by himself or counsel.
The charge may be made by the fiscal, by the judge, or even by a private person. . .
." 46
His claim that the letter of Atty. Legaspi "is not verified nor signed by members of
said (IBP Cebu Chapter) Board; . . . is vague, unspecific, and sweeping" because
failing to point out what particular statements in the circular are allegedly libelous and
condemnable;" and it does not appear that Atty. Legaspi has authority to speak or file
a complaint "in behalf of those accused in the 'libelous' circular" is in the premises,
plainly nothing but superficial philosophizing, deserving no serious treatment.
Equally as superficial, and sophistical, is his other contention that in making the
allegations claimed to be contumacious, he "was exercising his rights of freedom of
speech, of expression, and to petition the government for redress of grievances as
guaranteed by the Constitution (Sec. 4, Art. III) and in accordance with the
accountablity of public officials." The constitutional rights invoked by him afford no
justification for repetitious litigation of the same causes and issues, for insulting
lawyers, judges, court employees; and other persons, for abusing the processes and
rules of the courts, wasting their time, and bringing them into disrepute and
disrespect.
B. Basic Principles Governing
the Judicial Function
The facts and issues involved in the proceeding at bench make necessary a
restatement of the principles governing finality of judgments and of the paramount
need to put an end to litigation at some point, and to lay down definite postulates
concerning what is perceived to be a growing predilection on the part of lawyers and
litigants like Borromeo to resort to administrative prosecution (or institution of
civil or criminal actions) as a substitute for or supplement to the specific modes of
appeal or review provided by law from court judgments or orders.
1.
Reason
Hierarchy
for
courts; Judicial
Courts exist in every civilized society for the settlement of controversies. In every
country there is a more or less established hierarchical organization of courts, and a
more or less comprehensive system of review of judgments and final orders of lower
courts.
The judicial system in this jurisdiction allows for several levels of litigation, i.e., the
presentation of evidence by the parties a trial or hearing in the first instance as
well as a review of the judgments of lower courts by higher tribunals, generally by
consideration anew and ventilation of the factual and legal issues through briefs or
memoranda. The procedure for review is fixed by law, and is in the very nature of
things, exclusive to the courts.
2.
Paramount
Need
Litigation at Some Point
to
end
It is withal of the essence of the judicial function that at some point, litigation must
end. Hence, after the procedures and processes for lawsuits have been undergone,
and the modes of review set by law have been exhausted, or terminated, no further
ventilation of the same subject matter is allowed. To be sure, there may be, on the
part of the losing parties, continuing disagreement with the verdict, and the
conclusions therein embodied. This is of no moment, indeed, is to be expected; but, it
is not their will, but the Court's, which must prevail; and, to repeat, public policy
demands that at some definite time, the issues must be laid to rest and the court's
47
dispositions thereon accorded absolute finality. As observed by this Court
in Rheem of the Philippines v. Ferrer, a 1967 decision, 48 a party "may think highly of
his intellectual endowment. That is his privilege. And he may suffer frustration at what
he feels is others' lack of it. This is his misfortune. Some such frame of mind,
however, should not be allowed to harden into a belief that he may attack a court's
decision in words calculated to jettison the time-honored aphorism that courts are the
temples of right."
3.
Judgments
Not Reviewable
of
Supreme
Court
In respect of Courts below the Supreme Court, the ordinary remedies available under
law to a party who is adversely affected by their decisions or orders are a motion for
new trial (or reconsideration) under Rule 37, and an appeal to either the Court of
Appeals or the Supreme Court, depending on whether questions of both fact and law,
or of law only, are raised, in accordance with fixed and familiar rules and conformably
51
with the hierarchy of courts. Exceptionally, a review of a ruling or act of a court on
the ground that it was rendered without or in excess of its jurisdiction, or with grave
abuse of discretion, may be had through the special civil action of certiorari or
prohibition pursuant to Rule 65 of the Rules of Court.
Judgments of
Reviewable
The question then, is whether or not these complaints are proper; whether or not in
lieu of the prescribed recourses for appeal or review of judgments and orders of
courts, a party may file an administrative or criminal complaint against the judge for
rendition of an unjust judgment, or, having opted for appeal, may nonetheless
simultaneously seek also such administrative or criminal remedies.
Given the nature of the judicial function, the power vested by the Constitution in the
Supreme Court and the lower courts established by law, the question submits to only
one answer: the administrative or criminal remedies are neither alternative nor
cumulative to judicial review where such review is available, and must wait on the
result thereof.
Simple reflection will make this proposition amply clear, and demonstrate that any
contrary postulation can have only intolerable legal implications. Allowing a party who
feels aggrieved by a judicial order or decision not yet final and executory to mount an
administrative, civil or criminal prosecution for unjust judgment against the issuing
judge would, at a minimum and as an indispensable first step, confer the prosecutor
(or Ombudsman) with an incongruous function pertaining, not to him, but to the
courts: the determination of whether the questioned disposition is erroneous in its
findings of fact or conclusions of law, or both. If he does proceed despite that
impediment, whatever determination he makes could well set off a proliferation of
administrative or criminal litigation, a possibility here after more fully explored.
Such actions are impermissible and cannot prosper. It is not, as already pointed out,
within the power of public prosecutors, or the Ombudsman or his deputies, directly or
vicariously, to review judgments or final orders or resolutions of the Courts of the land.
The power of review by appeal or special civil action is not only lodged
exclusively in the Courts themselves but must be exercised in accordance with a welldefined and long established hierarchy, and long-standing processes and procedures.
No other review is allowed; otherwise litigation would be interminable, and vexatiously
repetitive.
These principles were stressed in In Re: Wenceslao Laureta, supra.
54
highest court of the land. To repeat, no other entity or official of the Government, not
the prosecution or investigation service or any other branch; nor any functionary
thereof, has competence to review a judicial order or decision whether final and
executory or not and pronounce it erroneous so as to lay the basis for a criminal or
administrative complaint for rendering an unjust judgment or order. That prerogative
belongs to the courts alone.
unjust judgment, or against the Justices of the Court of Appeals or the Supreme Court
who should affirm his conviction.
The situation is ridiculous, however the circumstances of the case may be modified,
and regardless of whether it is a civil, criminal or administrative proceeding that is
availed of as the vehicle to prosecute the judge for supposedly rendering an unjust
decision or order.
5. Primordial Requisites
Criminal Prosecution
for
Administrative
This is not to say that it is not possible at all to prosecute judges for this impropriety,
of rendering an unjust judgment or interlocutory order; but, taking account of all the
foregoing considerations, the indispensable requisites are that there be a final
declaration by a competent court in some appropriate proceeding of the manifestly
unjust character of the challenged judgment or order, and there be also evidence of
malice or bad faith, ignorance or inexcusable negligence, on the part of the judge in
rendering said judgement or order. That final declaration is ordinarily contained in the
judgment rendered in the appellate proceedings in which the decision of the trial court
in the civil or criminal action in question is challenged.
What immediately comes to mind in this connection is a decision of acquittal or
dismissal in a criminal action, as to which the same being unappealable it would
be unreasonable to deny the State or the victim of the crime (or even public-spirited
citizens) the opportunity to put to the test of proof such charges as they might see fit
to press that it was unjustly rendered, with malice or by deliberate design, through
inexcusable ignorance or negligence, etc. Even in this case, the essential requisite is
that there be an authoritative judicial pronouncement of the manifestly unjust
character of the judgment or order in question. Such a pronouncement may result
from either (a) an action of certiorari or prohibition in a higher court impugning the
validity of the; judgment, as having been rendered without or in excess of jurisdiction,
or with grave abuse of discretion; e.g., there has been a denial of due process to the
prosecution; or (b) if this be not proper, an administrative proceeding in the Supreme
Court against the judge precisely for promulgating an unjust judgment or order. Until
and unless there is such a final, authoritative judicial declaration that the decision or
order in question is "unjust," no civil or criminal action against the judge concerned is
legally possible or should be entertained, for want of an indispensable requisite.
D. Judges Must be Free from
Influence or Pressure
Judges must be free to judge, without pressure or influence from external forces or
factors. They should not be subject to intimidation, the fear of civil, criminal or
administrative sanctions for acts they may do and dispositions they may make in the
performance of their duties and functions. Hence it is sound rule, which must be
recognized independently of statute, that judges are not generally liable for acts done
within the scope of their jurisdiction and in good faith.
This Court has repeatedly and uniformly ruled that a judge may not be held
administratively accountable for every erroneous order or decision he renders. 55 To
hold otherwise would be nothing short of harassment and would make his position
doubly unbearable, for no one called upon to try the facts or interpret the law in the
56
process of administering justice can be infallible in his judgment. The error must be
57
gross or patent, deliberate and malicious, or incurred with evident bad faith; it is
only in these cases that administrative sanctions are called for as an imperative duty
of the Supreme Court.
As far as civil or criminal liability is concerned, existing doctrine is that "judges of
superior and general jurisdiction are not liable to respond in civil action for damages
for what they may do in the exercise of their judicial functions when acting within their
legal powers and jurisdiction." 58 Based on Section 9, Act No. 190, 59 the doctrine is
still good law, not inconsistent with any subsequent legislative issuance or court rule:
"No judge, justice of the peace or assessor shall be liable to a civil action for the
recovery of damages by reason of any judicial action or judgment rendered by him in
good faith, and within the limits of his legal powers and jurisdiction."
Exception to this general rule is found in Article 32 of the Civil Code, providing that
any public officer or employee, or any private individual, who directly or indirectly
obstructs, defeats, violates or in any manner impedes or impairs any of the
enumerated rights and liberties of another person which rights are the same as
those guaranteed in the Bill of Rights (Article III of the Constitution); shall be liable
to the latter for damages. However, such liability is not demandable from a judge
unless his act or omission constitutes a violation of the Penal Code or other penal
statute. But again, to the extent that the offenses therein described have "unjust
judgment or "unjust interlocutory order" for an essential element, it need only be
reiterated that prosecution of a judge for any of them is subject to the caveat already
mentioned: that such prosecution cannot be initiated, much less maintained, unless
there be a final judicial pronouncement of the unjust character of the decision or order
in issue.
groundless and insulting proceedings against the courts, born of affected bravado or
sheer egocentrism, to the extent of even involving the legislative and executive
departments, the Ombudsman included, in their assaults against the Judiciary in
pursuit of personal agendas. But all things, good or bad, must come to an end, and it
is time for the Court to now draw the line, with more promptitude, between reasoned
dissent and self-seeking pretense. The Court accordingly serves notice to those with
the same conceit or delusions that it will henceforth deal with them, decisively and
fairly, with a firm and even hand, and resolutely impose such punitive sanctions as
may be appropriate to maintain the integrity and independence of the judicial
institutions of the country.
WHEREFORE, Joaquin T. Borromeo is found and declared GUILTY of constructive
contempt repeatedly committed over time, despite warnings and instructions given to
him, and to the end that he may ponder his serious errors and grave misconduct and
learn due respect for the Courts and their authority, he is hereby sentenced to serve a
term of imprisonment of TEN (10) DAYS in the City Jail of Cebu City and to pay a fine
of ONE THOUSAND PESOS (P1,000.00). He is warned that a repetition of any of the
offenses of which he is herein found guilty, or any similar or other offense against
courts, judges or court employees, will merit further and more serious sanctions.
IT IS SO ORDERED.
Narvasa, C.J., Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Romero, Bellosillo,
Melo, Quiason, Vitug, Kapunan, Mendoza and Francisco, JJ., concur.
Puno, J., took no part.
E. Afterword
Considering the foregoing antecedents and long standing doctrines, it may well be
asked why it took no less than sixteen (16) years and some fifty (50) grossly
unfounded cases lodged by respondent Borromeo in the different rungs of the
Judiciary before this Court decided to take the present administrative measure. The
imposition on the time of the courts and the unnecessary work occasioned by
respondent's crass adventurism are self-evident and require no further elaboration. If
the Court, however, bore with him with Jobian patience, it was in the hope that the
repeated rebuffs he suffered, with the attendant lectures on the error of his ways,
would somehow seep into his understanding and deter him from further forays along
his misguided path. After all, as has repeatedly been declared, the power of contempt
is exercised on the preservative and not the vindictive principle. Unfortunately the
Court's forbearance had no effect on him.
Instead, the continued leniency and tolerance extended to him were read as signs of
weakness and impotence. Worse, respondent's irresponsible audacity appears to
have influenced and emboldened others to just as flamboyantly embark on their own
EN BANC
REPUBLIC OF THE PHILIPPINES,
Petitioner,
- versus -
SANDIGANBAYAN
(FIRST
DIVISION),
EDUARDO
M.
COJUANGCO,
JR.,
AGRICULTURAL
CONSULTANCY
SERVICES, INC., ARCHIPELAGO REALTY
CORP., BALETE RANCH, INC., BLACK
STALLION RANCH, INC., CHRISTENSEN
PLANTATION
COMPANY,
DISCOVERY
REALTY CORP., DREAM PASTURES, INC.,
ECHO RANCH, INC., FAR EAST RANCH,
INC., FILSOV SHIPPING COMPANY, INC.,
FIRST
UNITED
TRANSPORT,
INC.,
HABAGAT REALTY DEVELOPMENT, INC.,
KALAWAKAN RESORTS, INC., KAUNLARAN
AGRICULTURAL CORP., LABAYUG AIR
TERMINALS,
INC.,
LANDAIR
INTERNATIONAL MARKETING CORP., LHL
CATTLE CORP., LUCENA OIL FACTORY,
INC., MEADOW LARK PLANTATIONS, INC.,
METROPLEX COMMODITIES, INC., MISTY
MOUNTAIN
AGRICULTURAL
CORP.,
NORTHEAST CONTRACT TRADERS, INC.,
NORTHERN CARRIERS CORP., OCEANSIDE
MARITIME ENTERPRISES, INC., ORO
VERDE SERVICES, INC., PASTORAL FARMS,
INC., PCY OIL MANUFACTURING CORP.,
PHILIPPINE
TECHNOLOGIES,
INC.,
PRIMAVERA FARMS, INC., PUNONG-BAYAN
HOUSING DEVELOPMENT CORP., PURA
ELECTRIC
COMPANY,
INC.,
RADIO
AUDIENCE DEVELOPERS INTEGRATED
ORGANIZATION, INC., RADYO PILIPINO
CORP., RANCHO GRANDE, INC., REDDEE
DEVELOPERS,
INC.,
SAN
ESTEBAN
DEVELOPMENT CORP., SILVER LEAF
PLANTATIONS, INC., SOUTHERN SERVICE
TRADERS, INC., SOUTHERN STAR CATTLE
CORP., SPADE ONE RESORTS CORP.,
UNEXPLORED LAND DEVELOPERS, INC.,
VERDANT PLANTATIONS, INC., VESTA
AGRICULTURAL CORP. AND WINGS
RESORTS CORP.,
Respondents.
STALLION
RANCH,
INC.,
MISTY
MOUNTAINS
AGRICULTURAL
CORP.,
ARCHIPELAGO
REALTY
CORP.,
AGRICULTURAL
CONSULTANCY
SERVICES, INC., SOUTHERN STAR CATTLE
CORP., LHL CATTLE CORP., RANCHO
GRANDE, INC., DREAM PASTURES, INC.,
FAR EAST RANCH, INC., ECHO RANCH,
INC.,
LAND
AIR
INTERNATIONAL
MARKETING
CORP.,
REDDEE
DEVELOPERS,
INC.,
PCY
OIL
MANUFACTURING CORP., LUCENA OIL
FACTORY,
INC.,
METROPLEX
COMMODITIES,
INC.,
VESTA
AGRICULTURAL
CORP.,
VERDANT
PLANTATIONS,
INC.,
KAUNLARAN
AGRICULTURAL CORP., ECJ & SONS
AGRICULTURAL
ENTERPRISES,
INC.,
RADYO PILIPINO CORP., DISCOVERY
REALTY
CORP.,
FIRST
UNITED
TRANSPORT, INC., RADIO AUDIENCE
DEVELOPERS
INTEGRATED
ORGANIZATION,
INC.,
ARCHIPELAGO
FINANCE AND LEASING CORP., SAN
ESTEBAN
DEVELOPMENT
CORP.,
CHRISTENSEN PLANTATION COMPANY,
NORTHERN CARRIERS CORP., VENTURE
SECURITIES, INC., BALETE RANCH, INC.,
ORO
VERDE
SERVICES,
INC.,
and
KALAWAKAN RESORTS, INC.,
Respondents.
x--------------------------x
REPUBLIC OF THE PHILIPPINES,
Petitioner,
x--------------------------x
- versus REPUBLIC OF THE PHILIPPINES,
Petitioner,
- versus -
SANDIGANBAYAN
(FIRST
DIVISION),
EDUARDO M. COJUANGCO, JR., MEADOW
LARK PLANTATIONS, INC., SILVER LEAF
PLANTATIONS, INC., PRIMAVERA FARMS,
INC., PASTORAL FARMS, INC., BLACK
EDUARDO
M.
COJUANGCO,
JR.,
FERDINAND E. MARCOS, IMELDA R.
MARCOS, EDGARDO J. ANGARA,* JOSE C.
CONCEPCION,
AVELINO
V.
CRUZ,
EDUARDO U. ESCUETA, PARAJA G.
HAYUDINI,
JUAN
PONCE
ENRILE,
TEODORO D. REGALA, DANILO URSUA,
ROGELIO A. VINLUAN, AGRICULTURAL
CONSULTANCY SERVICES, INC., ANGLO
VENTURES, INC., ARCHIPELAGO REALTY
CORP.,
AP
HOLDINGS,
INC.,
ARC
INVESTMENT, INC., ASC INVESTMENT,
INC.,
AUTONOMOUS
DEVELOPMENT
CORP., BALETE RANCH, INC., BLACK
STALLION RANCH, INC., CAGAYAN DE
ORO OIL COMPANY, INC., CHRISTENSEN
PLANTATION
COMPANY,
COCOA
INVESTORS, INC., DAVAO AGRICULTURAL
AVIATION, INC., DISCOVERY REALTY
CORP., DREAM PASTURES, INC., ECHO
RANCH, INC., ECJ & SONS AGRI. ENT., INC.,
FAR EAST RANCH, INC., FILSOV SHIPPING
COMPANY,
INC.,
FIRST
MERIDIAN
DEVELOPMENT, INC., FIRST UNITED
TRANSPORT,
INC.,
GRANEXPORT
MANUFACTURING
CORP.,
HABAGAT
REALTY DEVELOPMENT, INC., HYCO
AGRICULTURAL, INC., ILIGAN COCONUT
INDUSTRIES, INC., KALAWAKAN RESORTS,
INC., KAUNLARAN AGRICULTURAL CORP.,
LABAYOG AIR TERMINALS, INC., LANDAIR
INTERNATIONAL MARKETING
CORP.,
LEGASPI OIL COMPANY, LHL CATTLE
CORP., LUCENA OIL FACTORY, INC.,
MEADOW LARK PLANTATIONS, INC.,
METROPLEX COMMODITIES, INC., MISTY
MOUNTAIN
AGRICULTURAL
CORP.,
NORTHEAST CONTRACT TRADERS, INC.,
NORTHERN CARRIERS CORP., OCEANSIDE
MARITIME ENTERPRISES, INC., ORO
VERDE SERVICES, INC., PASTORAL FARMS,
INC., PCY OIL MANUFACTURING CORP.,
PHILIPPINE
RADIO
CORP.,
INC.,
PHILIPPINE
TECHNOLOGIES,
INC.,
PRIMAVERA FARMS, INC., PUNONG-BAYAN
HOUSING DEVELOPMENT CORP., PURA
ELECTRIC
COMPANY,
INC.,
RADIO
AUDIENCE DEVELOPERS INTEGRATED
ORGANIZATION, INC., RADYO PILIPINO
CORP., RANCHO GRANDE, INC., RANDY
ALLIED
VENTURES,
INC.,
REDDEE
DEVELOPERS,
INC.,
ROCKSTEEL
RESOURCES, INC., ROXAS SHARES, INC.,
SAN ESTEBAN DEVELOPMENT CORP., SAN
MIGUEL CORPORATION OFFICERS, INC.,
SAN PABLO MANUFACTURING CORP.,
SOUTHERN LUZON OIL MILLS, INC.,
SILVER
LEAF
PLANTATIONS,
INC.,
SORIANO SHARES, INC., SOUTHERN
SERVICE TRADERS, INC., SOUTHERN STAR
CATTLE CORP., SPADE 1 RESORTS CORP.,
(b)
(c)
Present:
CORONA, C.J.,
CARPIO,
CARPIO MORALES,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO,
BRION,
PERALTA,
BERSAMIN,
DEL CASTILLO,
ABAD,
VILLARAMA, JR.,
PEREZ,
MENDOZA, and
SERENO, JJ.:
Promulgated:
April 12, 2011
x-----------------------------------------------------------------------------------------x
DECISION
BERSAMIN, J.:
For over two decades, the issue of whether the sequestered sizable block of shares
representing 20% of the outstanding capital stock of San Miguel Corporation (SMC) at the
time of acquisition belonged to their registered owners or to the coconut farmers has remained
unresolved. Through this decision, the Court aims to finally resolve the issue and terminate the
uncertainty that has plagued that sizable block of shares since then.
These consolidated cases were initiated on various dates by the Republic of the
Philippines
(Republic) via petitions
for certiorari in
G.R.
Nos.
166859[1] and
[2]
[3]
169023, and via petition for review on certiorari in 180702, the first two petitions being
brought to assail the following resolutions issued in Civil Case No. 0033-F by the
Sandiganbayan, and the third being brought to appeal the adverse decision promulgated on
November 28, 2007 in Civil Case No. 0033-F by the Sandiganbayan.
ANTECEDENTS
On July 31, 1987, the Republic commenced Civil Case No. 0033 in the Sandiganbayan
by complaint, impleading as defendants respondent Eduardo M. Cojuangco, Jr. (Cojuangco)
and 59 individual defendants. On October 2, 1987, the Republic amended the complaint in
Civil Case No. 0033 to include two additional individual defendants. OnDecember 8, 1987,
the Republic further amended the complaint through its Amended Complaint [Expanded per
Court-Approved Plaintiffs Manifestation/Motion Dated Dec. 8, 1987] albeit dated October 2,
1987.
More than three years later, on August 23, 1991, the Republic once more amended the
complaint apparently to avert the nullification of the writs of sequestration issued against
properties of Cojuangco. The amended complaint dated August 19, 1991, designated as Third
Amended Complaint [Expanded Per Court-Approved Plaintiffs Manifestation/Motion Dated
Dec. 8, 1987],[8] impleaded in addition to Cojuangco, President Marcos, and First Lady Imelda
R. Marcos nine other individuals, namely: Edgardo J. Angara, Jose C. Concepcion, Avelino V.
Cruz, Eduardo U. Escueta, Paraja G. Hayudini, Juan Ponce Enrile, Teodoro D. Regala, and
Rogelio Vinluan, collectively, the ACCRA lawyers, and Danilo Ursua, and 71 corporations.
On March 24, 1999, the Sandiganbayan allowed the subdivision of the complaint in
Civil Case No. 0033 into eight complaints, each pertaining to distinct transactions and
properties and impleading as defendants only the parties alleged to have participated in the
relevant transactions or to have owned the specific properties involved. The subdivision
resulted into the following subdivided complaints, to wit:
Subdivided Complaint
1. Civil Case No. 0033-A
Subject Matter
Anomalous Purchase and Use of First United
Bank (now United Coconut Planters Bank)
2.
3.
4.
5.
Unlawful Disbursement
ofCoco Levy Funds
6.
7.
Acquisition of Pepsi-Cola
8.
and
Dissipation
In Civil Case No. 0033-F, the individual defendants were Cojuangco, President
Marcos and First Lady Imelda R. Marcos, the ACCRA lawyers, and Ursua. Impleaded as
corporate defendants were Southern Luzon Oil Mills, Cagayan de Oro Oil Company,
Incorporated, Iligan Coconut Industries, Incorporated, San Pablo Manufacturing
Corporation, Granexport Manufacturing Corporation, Legaspi Oil Company, Incorporated,
collectively referred to herein as the CIIF Oil Mills, and their 14 holding companies, namely:
Soriano Shares, Incorporated, Roxas Shares, Incorporated, Arc Investments, Incorporated,
Toda Holdings, Incorporated, ASC Investments, Incorporated, Randy Allied Ventures,
Incorporated, AP Holdings, Incorporated, San Miguel Corporation Officers, Incorporated, Te
Deum Resources, Incorporated, Anglo Ventures, Incorporated, Rock Steel Resources,
Incorporated, Valhalla Properties, Incorporated, and First Meridian Development,
Incorporated.
Allegedly, Cojuangco purchased a block of 33,000,000 shares of SMC stock through
the 14 holding companies owned by the CIIF Oil Mills. For this reason, the block of
33,133,266 shares of SMC stock shall be referred to as the CIIF block of shares.
cement
The
material
averments
of
the
Republics Third
Complaint (Subdivided)[10] in Civil Case No. 0033-F included the following:
Amended
a)
b)
c)
d)
e)
f)
g)
h)
i)
j)
k)
l)
m)
n)
1,249,163
1,562,449
2,190,860
4,431,798
3,424,618
1,580,997
838,837
2,385,987
2,674,899
1,000.000
1,000,000
2,432,625
1,361,033
1,000,000
___________
33,133,266
19%
11%
19%
18%
18%
15%
_____
100%
Source
Purpose
$22.26
Oil Mills
equity in holding
companies
$65.6
Oil Mills
loan to holding
companies
$61.2
UCPB
loan to holding
companies [164]
The entire amount, therefore, came from the coconut levy, some
passing through the Unicom Oil mills, others directly from the
UCPB.
(m) With his entry into the said Company, it began to get
favors from the Marcos government, significantly the lowering of
the excise taxes (sales and specific taxes) on beer, one of the main
products of SMC.
(n) Defendant Cojuangco controlled SMC from 1983 until
his co-defendant Marcos was deposed in 1986.
(o) Along
with
Cojuangco,
Defendant
Enrile
and ACCRA also had interests in SMC, broken down as follows:
% of SMC
Cojuangco
Owner
31.3%
18%
5.2%
government
5.2%
Enrile
Jaka Investment Corporation
1.8%
On June 23, 1999, Cojuangco filed his Answer to the Third Amended
Complaint,[15] averring the following affirmative defenses, to wit:
7.00. The Presidential Commission on Good Government (PCGG) is
without authority to act in the name and in behalf of the Republic of
the Philippines.
7.01. As constituted in E.O. No. 1, the PCGG was composed of
Minister Jovito R. Salonga, as Chairman, Mr. Ramon Diaz, Mr. Pedro L.
In his own Answer with Compulsory Counterclaims,[18] Enrile specifically denied the
material averments of the Third Amended Complaint and asserted affirmative defenses.
The CIIF Oil Mills Answer[19] also contained affirmative defenses.
On December 20, 1999, the Sandiganbayan scheduled the pre-trial in Civil Case No.
0033-F on March 8, 2000, giving the parties sufficient time to file their Pre-Trial Briefs prior
to that date. Subsequently, the parties filed their respective Pre-Trial Briefs, as follows:
Cojuangco and the Cojuangco corporations, jointly on February 14, 2000; Enrile, on March 1,
2000; the CIIF Oil Mills, on March 3, 2000; and Ursua, on March 6, 2000. However, the
Republic sought several extensions to file its own Pre-Trial Brief, and eventually did so
on May 9, 2000.
The following material portions of the pre-trial order[24] are quoted to provide a
proper perspective of what transpired during the pre-trial, to wit:
Upon oral inquiry from the Court, the issues which were being raised
by plaintiff appear to have been made on a very generic
character. Considering that any claim for violation or breach of trust or
deception cannot be made on generic statements but rather by specific acts
which would demonstrate fraud or breach of trust or deception, together
with the evidence in support thereof, the same was not acceptable to the
Court.
The plaintiff through its designated counsel for this morning, Atty.
Dennis Taningco, has represented to this Court that the annexes to its pretrial brief, more particularly the findings of the COA in its various
examinations, copies of which COA reports are attached to the pre-trial
brief, would demonstrate the wrong, the act or omission attributed to the
defendants or to several of them and the basis, therefore, for the relief that
plaintiff seeks in its complaint. It would appear, however, that the plaintiff
through its counsel at this time is not prepared to go into the specifics of
the identification of these wrongs or omissions attributed to plaintiff.
The Court has reminded the plaintiff that a COA report proves itself
only in proceedings where the issue arises from a review of the
accountability of particular officers and, therefore, to show the existence
of shortages or deficiencies in an examination conducted for that purpose,
provided that such a report is accompanied by its own working papers and
other supporting documents.
In civil cases such as this, a COA report would not have the same
independent probative value since it is not a review of the accountability
of public officers for public property in their custody as accountable
officers. It has been the stated view of this Court that a COA report, to be
of significant evidence, may itself stand only on the basis of the supporting
documents that upon which it is based and upon an analysis made by those
who are competent to do so. The Court, therefore, sought a more specific
statement from plaintiff as to what these documents were and which of
them would prove a particular act or omission or a series of acts or
omissions purportedly committed by any, by several or by all of the
defendants in any particular stage of the chain of alleged wrong-doing in
this case.
The plaintiff was not in a position to do so.
The Court has remonstrated with the plaintiff, insofar as its
inadequacy is concerned, primarily because this case was set for pre-trial
as far back as December and has been reset from its original setting, with
the undertaking by the plaintiff to prepare itself for these proceedings. It
appears to this Court at this time that the failure of the plaintiff to have
available responses and specific data and documents at this stage is not
because the matter has been the product of oversight or notes and papers
left elsewhere; rather, the agitation of this Court arises from the fact that at
this very stage, the plaintiff through its counsel does not know what these
xxx
xxx.
[31]
On February 23, 2004, the Sandiganbayan issued an order, [32] in which it enumerated the
admitted facts or facts that appeared to be without substantial controversy in relation to the
Republics Motion for Judgment on the Pleadings and/or for Partial Summary Judgment [Re:
Defendants CIIF Companies, 14 Holding Companies and COCOFED, et al.].
Commenting on the order of February 23, 2004, Cojuangco, et al. specified the
items they considered as inaccurate, but particularly interposed no objection to item no. 17 (to
the extent that item no. 17 stated that Cojuangco had disclaimed any interest in the CIIF block
SMC shares of stock registered in the names of the 14 corporations listed in item no. 1 of the
order).[33]
The Republic also filed its Comment,[34] but COCOFED denied the admitted facts
summarized in the order of February 23, 2004.[35]
Earlier, on October 8, 2003,[36] the Sandiganbayan resolved the various pending motions
and pleadings relative to the writs of sequestration issued against the defendants, disposing:
IN VIEW OF THE FOREGOING, the Writs of Sequestration Nos. (a)
86-0042 issued on April 8, 1986, (b) 86-0062 issued on April 21, 1986, (c)
86-0069 issued on April 22, 1986, (d) 86-0085 issued on May 9, 1986, (e)
86-0095 issued on May 16, 1986, (f) 86-0096 dated May 16, 1986, (g) 860097 issued on May 16, 1986, (h) 86-0098 issued on May 16, 1986 and (i)
87-0218 issued on May 27, 1987 are hereby declared automatically lifted
for being null and void.
Despite the lifting of the writs of sequestration, since the Republic
continues to hold a claim on the shares which is yet to be resolved, it is
2)
3)
4)
COCOFED moved to set the case for trial, [55] but the Republic opposed the
motion.[56] On their part, Cojuangco, et al. also moved to set the trial, [57] with the Republic
similarly opposing the motion. [58]
On March 23, 2006, the Sandiganbayan granted the motions to set for trial and set
the trial on August 8, 10, and 11, 2006. [59]
In the meanwhile, on August 9, 2005, the Republic filed a Motion for Execution of
Partial Summary Judgment (re: CIIF block of SMC Shares of Stock),[60] contending that an
execution pending appeal was justified because any appeal by the defendants of the Partial
Summary Judgment would be merely dilatory.
Cojuangco, et al. opposed the motion.[61]
The Sandiganbayan denied the Republics Motion for Execution of Partial Summary
Judgment (re: CIIF block of SMC Shares of Stock),[62] to wit:
WHEREFORE, the MOTION FOR EXECUTION OF PARTIAL
SUMMARY JUDGMENT (RE: CIIF BLOCK OF SMC SHARES OF
STOCK) dated August 8, 2005 of the plaintiff is hereby denied for lack of
merit. However, this Court orders the severance of this particular claim of
Plaintiff. The Partial Summary Judgment dated May 7, 2004 is now
considered a separate final and appealable judgment with respect to the
said CIIF Block of SMC shares of stock.
The Partial Summary Judgment rendered on May 7, 2004 is
modified by deleting the last paragraph of the dispositive portion which
will now read, as follows:
WHEREFORE, in view of the foregoing, we hold that:
The Motion for Partial Summary Judgment (Re:
Defendants CIIF Companies, 14 Holding Companies and
Cocofed, et al.) filed by Plaintiff is hereby
GRANTED. ACCORDINGLY, THE CIIF COMPANIES,
NAMELY:
1.
2.
3.
4.
5.
6.
AS WELL AS
NAMELY:
1.
2.
3.
4.
THE
14
HOLDING
COMPANIES,
SO ORDERED.[63]
During the pendency of the Republics motion for execution, Cojuangco, et al. filed
a Motion for Authority to Sell San Miguel Corporation (SMC) shares, praying for leave to
allow the sale of SMC shares to proceed, exempted from the conditions set forth in the
resolutions promulgated on October 3, 2003 and June 24, 2005. [64] The Republic
opposed, contending that the requested leave to sell would be tantamount to removing
jurisdiction over the res or the subject of litigation.[65]
However, the Sandiganbayan eventually granted the Motion for Authority to Sell San
Miguel Corporation (SMC) shares.[66]
Thereafter, Cojuangco, et al. manifested to the Sandiganbayan that the shares would
be sold to the San Miguel Corporation Retirement Plan. [67] Ruling on the manifestations of
Cojuangco, et al., the Sandiganbayan issued its resolution of July 30, 2007 allowing the sale of
the shares, to wit:
This notwithstanding however, while the Court exempts the sale
from the express condition that it shall be subject to the outcome of the
case, defendants Cojuangco, et al. may well be reminded that despite the
deletion of the said condition, they cannot transfer to any buyer any
interest higher than what they have. No one can transfer a right to another
greater than what he himself has. Hence, in the event that the Republic
prevails in the instant case, defendants Cojuangco, et al. hold themselves
On August 31, 2006, the Republic filed its Manifestation of Purposes (Re: Matters
Requested or Judicial Notice on the 20% Shares in San Miguel Corporation Registered in the
Respective Names of defendant Eduardo M. Cojuangco, Jr. and the defendant Cojuangco
Companies).[71]
On September 18, 2006, the Sandiganbayan issued the following resolution, [72] to
wit:
Acting on the Manifestation of Purposes (Re: Matters Requested or
Judicial Notice on the 20% Shares in San Miguel Corporation Registered
in the Respective names of Defendant Eduardo M. Cojuangco, Jr. and the
Defendant Cojuangco Companies) dated 28 August 2006 filed by the
plaintiff, which has been considered its formal offer of evidence, and the
Comment of Defendants Eduardo M. Cojuangco, Jr., et al. on Plaintiffs
Manifestation of Purposes Dated August 30, 2006 dated September
15, 2006, the court resolves to ADMIT all the exhibits offered, i.e.:
The Republic came to the Court via petition for certiorari[77] to assail the denial of
its Motion for Partial Summary Judgment through the resolution promulgated on December
10, 2004, insisting that the Sandiganbayan thereby committed grave abuse of discretion: (a) in
holding that the various sources of funds used in acquiring the SMC shares of stock remained
disputed; (b) in holding that it was disputed whether or not Cojuangco had served in the
governing bodies of PCA, UCPB, and/or the CIIF Oil Mills; and (c) in not finding that
Cojuangco had taken advantage of his position and had violated his fiduciary obligations in
acquiring the SMC shares of stock in issue.
The Court will consider and resolve the issues thereby raised alongside the issues
presented in G.R. No. 180702.
the said exhibits being part of the record of the case, as well as
G.R. No. 169203
III.
XXX IN SUBSEQUENTLY DELETING THE LAST TWO (2)
CONDITIONS WHICH IT EARLIER IMPOSED ON THE SUBJECT
SHARES OF STOCK.[81]
II.
WHETHER OR NOT THE SUBJECT SHARES IN SMC, WHICH
WERE ACQUIRED BY, AND ARE IN THE RESPECTIVE NAMES OF
RESPONDENTS COJUANGCO, JR. AND THE COJUANGCO
I
WHETHER OR NOT THE COURT A QUO GRAVELY ERRED AND
DECIDED THE CASE A QUO IN VIOLATION OF LAW AND
APPLICABLE RULINGS OF THE HONORABLE COURT IN RULING
THAT, WHILE ADMITTEDLY THE SUBJECT SMC SHARES WERE
PURCHASED FROM LOAN PROCEEDS FROM UCPB AND
ADVANCES FROM THE CIIF OIL MILLS, SAID SUBJECT SMC
SHARES ARE NOT PUBLIC PROPERTY
II
WHETHER OR NOT THE COURT A QUO GRAVELY ERRED AND
DECIDED THE CASE A QUO IN VIOLATION OF LAW AND
APPLICABLE RULINGS OF THE HONORABLE COURT IN FAILING
TO RULE THAT, EVEN ASSUMING FOR THE SAKE OF
ARGUMENT THAT LOAN PROCEEDS FROM UCPB ARE NOT
PUBLIC FINDS, STILL, SINCE RESPONDENT COJUANGCO, IN
THE PURCHASE OF THE SUBJECT SMC SHARES FROM SUCH
LOAN PROCEEDS, VIOLATED HIS FIDUCIARY DUTIES AND
TOOK A COMMERCIAL OPPORTUNITY THAT RIGHTFULLY
BELONGED TO UCPB (A PUBLIC CORPORATION), THE SUBJECT
SMC SHARES SHOULD REVERT BACK TO THE GOVERNMENT.
RULING
We deny all the petitions of the Republic.
I
Lifting of nine WOS for violation of PCGG Rules
did not constitute grave abuse of discretion
Through its resolution promulgated on June 24, 2005, assailed on certiorari in G.R.
No. 169203, the Sandiganbayan lifted the nine WOS for the following reasons, to wit:
Having studied the antecedent facts, this Court shall now resolve
the pending incidents especially defendants Motion to Affirm that the
Writs or Orders of Sequestration Issued on Defendants Properties Were
Unauthorized, Invalid and Never Became Effective dated March 5, 1999.
Section 3 of the PCGG Rules and Regulations promulgated
on April 11, 1986, provides:
Sec. 3. Who may issue. A writ of sequestration or a
freeze or hold order may be issued by the Commission upon
Dio Island Resort, dated April 14, 1986, was prepared, issued
and signed not by two commissioners of the PCGG, but by
the head of its task force in Region VIII. In holding that said
order was not valid since it was not issued in accordance with
PCGG Rules and Regulations, we explained:
(Sec. 3 of the PCGG Rules and Regulations),
couched in clear and simple language, leaves no
room for interpretation. On the basis thereof, it is
indubitable that under no circumstances can a
sequestration or freeze order be validly issued by
one not a commissioner of the PCGG.
xxx
xxx
xxx
Conformably with Section 3, supra, WOS No. 86-0062 dated April 21, 1986; WOS No.
86-0069 dated April 22, 1986; WOS No. 86-0085 dated May 9, 1986; WOS No. 86-0095
dated May 16, 1986; WOS No. 86-0096 dated May 16, 1986; WOS No. 86-0097 dated May
16, 1986; and WOS No. 86-0098 dated May 16, 1986 were lawfully and correctly nullified
considering that only one PCGG Commissioner had issued them.
Similarly, WOS No. 86-0042 dated April 8, 1986 and WOS No. 87-0218 dated May
27, 1987 were lawfully and correctly nullified notwithstanding that WOS No. 86-0042, albeit
signed by only one Commissioner (i.e., Commissioner Mary Concepcion Bautista), was not at
the time of its issuance subject to the two-Commissioners rule, and WOS No. 87-0218, albeit
already issued under the signatures of two Commissioners considering that both had been
issued without a prior determination by the PCGG of aprima facie basis for the sequestration.
Plainly enough, the irregularities infirming the issuance of the several WOS could
not be ignored in favor of the Republic and resolved against the persons whose properties were
subject of the WOS. Where the Rules of the PCGG instituted safeguards under Section
3, supra, by requiring the concurrent signatures of two Commissioners to every WOS issued
and the existence of a prima facie case of ill gotten wealth to support the issuance, the noncompliance with either of the safeguards nullified the WOS thus issued. It is already settled
that sequestration, due to its tendency to impede or limit the exercise of proprietary rights by
private citizens, is construed strictly against the State, conformably with the legal maxim that
statutes in derogation of common rights are generally strictly construed and rigidly confined to
the cases clearly within their scope and purpose.[86]
Consequently, the nullification of the nine WOS, being in implementation of the
safeguards the PCGG itself had instituted, did not constitute any abuse of its discretion, least
of all grave, on the part of the Sandiganbayan.
Nor did the Sandiganbayan gravely abuse its discretion in reducing from four to only
two the conditions imposed for the lifting of the WOS. The Sandiganbayan thereby acted with
the best of intentions, being all too aware that the claim of the Republic to the sequestered
assets and properties might be prejudiced or harmed pendente lite unless the protective
conditions were annotated in the corporate books of SMC. Moreover, the issue became
academic following the Sandiganbayans promulgation of its decision dismissing the
Republics Amended Complaint, which thereby removed the stated reason the Republic
continues to hold a claim on the shares which is yet to be resolved underlying the need for
the annotation of the conditions (whether four or two).
II
The Concept and Genesis of
Ill-Gotten Wealth in the Philippine Setting
A brief review of the Philippine law and jurisprudence pertinent to ill-gotten
wealth should furnish an illuminating backdrop for further discussion.
In the immediate aftermath of the peaceful 1986 EDSA Revolution, the
administration of President Corazon C. Aquino saw to it, among others, that rules defining the
authority of the government and its instrumentalities were promptly put in place. It is
significant to point out, however, that the administration likewise defined the limitations of the
authority.
The first official issuance of President Aquino, which was made on February 28,
1986, or just two days after the EDSA Revolution, was Executive Order (E.O.) No. 1, which
created the Presidential Commission on Good Government (PCGG). Ostensibly, E.O. No. 1
was the first issuance in light of the EDSA Revolution having come about mainly to address
the pillage of the nations wealth by President Marcos, his family, and cronies.
in Presidential
In Republic v. Migrio,[93] the Court held that respondents Migrio, et al. were not
necessarily among the persons covered by the term close subordinate or close associateof
former President Marcos by reason alone of their having served as government officials or
employees during the Marcos administration, viz:
It does not suffice, as in this case, that the respondent is or was a
government official or employee during the administration of former
Pres. Marcos. There must be a prima facie showing that the
respondent unlawfully accumulated wealth by virtue of his close
association or relation with former Pres. Marcos and/or his wife. This
is so because otherwise the respondents case will fall under existing
general laws and procedures on the matter. xxx
In Cruz, Jr. v. Sandiganbayan,[94] the Court declared that the petitioner was not
a close associate as the term was used in E.O. No. 1 just because he had served as the
President and General Manager of the GSIS during the Marcos administration.
In Republic v. Sandiganbayan,[95] the Court stated that respondent Maj. Gen.
Josephus Q. Ramas having been a Commanding General of the Philippine Army during the
Marcos administration d[id] not automatically make him a subordinate of former President
Ferdinand Marcos as this term is used in Executive Order Nos. 1, 2, 14 and 14-A absent a
showing that he enjoyed close association with former President Marcos.
It is well to point out, consequently, that the distinction laid down by E.O. No. 1 and its
related issuances, and expounded by relevant judicial pronouncements unavoidably
required competent evidentiary substantiation made in appropriate judicial proceedings to
determine: (a) whether the assets or properties involved had come from the vast resources of
government, and (b) whether the individuals owning or holding such assets or properties were
close associates of President Marcos. The requirement of competent evidentiary
substantiation made in appropriate judicial proceedings was imposed because the factual
premises for the reconveyance of the assets or properties in favor of the government due to
their being ill-gotten wealth could not be simply assumed. Indeed, in BASECO,[96] the Court
made this clear enough by emphatically observing:
6. Governments Right and Duty to Recover All Ill-gotten Wealth
There can be no debate about the validity and eminent propriety of
the Governments plan to recover all ill-gotten wealth.
Neither can there be any debate about the proposition that assuming
the above described factual premises of the Executive Orders and
Proclamation No. 3 to be true, to be demonstrable by competent evidence,
the recovery from Marcos, his family and his minions of the assets and
properties involved, is not only a right but a duty on the part of
Government.
But however plain and valid that right and duty may be, still a
balance must be sought with the equally compelling necessity that a
proper respect be accorded and adequate protection assured, the
fundamental rights of private property and free enterprise which are
deemed pillars of a free society such as ours, and to which all members of
that society may without exception lay claim.
Going over the evidence, especially the laws, i.e., P.D. No. 961, P.D.
No. 755, and P.D. No. 1468, over which plaintiff prayed that Court to take
judicial notice of, it is worth noting that these same laws were cited by
plaintiff when it filed its motion for judgment on the pleadings and/or
summary judgment regarding the CIIF block of SMC shares of
stock. Thus, the Court has already passed upon the same laws when it
arrived at judgment determining ownership of the CIIF block of SMC
shares of stock. Pertinently, in the Partial Summary Judgment
promulgated onMay 7, 2004, the Court gave the following rulings finding
certain provisions of the above-cited laws to be constitutionally infirmed,
thus:
In this case, Section 2(d) and Section 9 and 10, Article III,
of P.D. Nos. 961 and 1468 mandated the UCPB to utilize the
CIIF, an accumulation of a portion of the CCSF and the
CIDF, for investment in the form of shares of stock in
corporations organized for the purpose of engaging in the
establishment and the operation of industries and commercial
activities and other allied business undertakings relating to
coconut and other palm oils industry in all aspects. The
investments made by UCPB in CIIF companies are required
by the said Decrees to be equitably distributed for free by the
said bank to the coconut farmers (Sec. 10, P.D. No. 961 and
Sec. 10, P.D. No. 1468). The public purpose sought to be
served by the free distribution of the shares of stock acquired
with the use of public funds is not evident in the laws
mentioned. More specifically, it is not clear how private
ownership of the shares of stock acquired with public funds
can serve a public purpose. The mode of distribution of the
shares of stock also left much room for the diversion of assets
acquired through public funds into private uses or to serve
directly private interests, contrary to the Constitution. In the
said distribution, defendants COCOFED, et al. and Ballares,
et al. admitted that UCPB followed the administrative
issuances of PCA which we found to be constitutionally
objectionable in our Partial Summary Judgment in Civil Case
No. 0033-A, the pertinent portions of which are quoted
hereunder:
xxx
xx
xxx.
xxx
xxx.
And, with the above-findings of the Court, the CIIF block of SMC
shares were subsequently declared to be of public character and should be
reconveyed to the government in trust for coconut farmers. The foregoing
findings notwithstanding, a question now arises on whether the same laws
can likewise serve as ultimate basis for a finding that the Cojuangco, et al.
block of SMC shares are also imbued with public character and should
rightfully be reconveyed to the government.
On this point, the Court disagrees with plaintiff that reliance on
said laws would suffice to prove that defendants Cojuangco, et al.s
acquisition of SMC shares of stock was illegal as public funds were
used. For one, plaintiffs reliance thereon has always had reference
only to the CIIF block of shares, and the Court has already settled the
same by going over the laws and quoting related findings in the
Partial Summary judgment rendered in Civil Case No. 0033-A. For
another, the allegations of plaintiff pertaining to the Cojuangco block
representing twenty percent (20%) of the outstanding capital stock of
SMC stress defendant Cojuangcos acquisition by virtue of his
positions as Chief Executive Officer of UCPB, a member-director of
the Philippine Coconut Authority (PCA) Governing Board, and a
director of the CIIF Oil Mills. Thus, reference to the said laws would
not settle whether there was abuse on the part of defendants
Cojuangco, et al. of their positions to acquire the SMC shares. [98]
Besides, in the Resolution of the Court on plaintiffs Motion for
Parial Summary Judgment (Re: Shares in San Miguel Corporation
Registered in the Respective Names of Defendants Eduardo M.
Cojuangco, Jr. and the defendant Cojuangco Companies), the Court
already rejected plaintiffs reference to said laws. In fact, the Court
declined to grant plaintiffs motion for partial summary judgment
because it simply contended that defendant Cojuangcos statements in
his pleadings, which plaintiff again offered in evidence herein,
regarding the presentation of a possible CIIF witness as well as UCPB
records can already be considered admissions of defendants exclusive
use and misuse of coconut levy funds. In the said resolution, the
Court already reminded plaintiff that the issues cannot be resolved by
plaintiffs interpretation of defendant Cojuangcos statements in his
brief. Thus, the substantial portion of the Resolution of the Court
It was plain, indeed, that Cojuangco, et al. had tendered genuine issues through their
responsive pleadings and did not admit that the acquisition of the Cojuangco block of SMC
shares had been illegal, or had been made with public funds. As a result, the Republic needed
to establish its allegations with preponderant competent evidence, because, as earlier stated,
the fact that property was ill gotten could not be presumed but must be substantiated with
competent proof adduced in proper judicial proceedings. That the Republic opted not to
adduce competent evidence thereon despite stern reminders and warnings from the
Sandiganbayan to do so revealed that the Republic did not have the competent evidence to
prove its allegations against Cojuangco, et al.
Still, the Republic, relying on the 2001 holding
COCOFED,[104] pleads in its petition for review (G.R. No. 180702) that:
in Republic
v.
borrowings and advances had been illegal because the shares had not been purchased for the
benefit of the Coconut Farmers. To buttress its assertion, the Republic relied on the
admissions supposedly made in paragraph 2.01 of Cojuangcos Answer in relation to
paragraph 4 of the Republics Amended Complaint.
The best way to know what paragraph 2.01 of Cojuangcos Answer admitted is to
refer to both paragraph 4 of the Amended Complaint and paragraph 2.01 of
his Answer,which are hereunder quoted:
Paragraph 4 of the Amended Complaint
4. Defendant EDUARDO M. COJUANGCO, JR., was Governor of
Tarlac, Congressman of then First District of Tarlac and Ambassador-atLarge in the Marcos Administration. He was commissioned Lieutenant
Colonel in the Philippine Air Force, Reserve. Defendant Eduardo M.
Cojuangco, Jr., otherwise known as the Coconut King was head of the
coconut monopoly which was instituted by Defendant Ferdinand E.
Marcos, by virtue of the Presidential Decrees. Defendant Eduardo E.
Cojuangco, Jr., who was also one of the closest associates of the
Defendant Ferdinand E. Marcos, held the positions of Director of the
Philippine Coconut Authority, the United Coconut Mills, Inc., President
and Board Director of the United Coconut Planters Bank, United Coconut
Planters Life Assurance Corporation, and United Coconut Chemicals, Inc.
He was also the Chairman of the Board and Chief Executive Officer and
the controlling stockholder of the San Miguel Corporation. He may be
served summons at 45 Balete Drive, Quezon City or at 136 East
9th Street, Quezon City.
Paragraph 2.01 of Respondent Cojuangcos Answer
2.01. Herein defendant admits paragraph 4 only insofar as it alleges
the following:
Thirdly, the Republics assertion that coconut levy funds had been used to source the
payment for the Cojuangco block of SMC shares was premised on its allegation that the UCPB
and the CIIF Oil Mills were public corporations. But the premise was grossly erroneous and
overly presumptuous, because:
(a) The fact of the UCPB and the CIIF Oil Mills being public corporations
or government-owned or government-controlled corporations
precisely remainedcontroverted by Cojuangco, et al. in light of the
lack of any competent to that effect being in the records;
(b) Cojuangco explicitly averred in paragraph 2.01.(b) of his Answer that
the UCPB was a private corporation; and
(c) The Republic did not competently identify or establish which ones of
the Cojuangco corporations had supposedly received advances from
the CIIF Oil Mills.
Fourthly, the Republic asserts that the contested block of shares had been paid for with
borrowings from the UCPB and advances from the CIIF Oil Mills, and that such
It is basic in remedial law that a defendant in a civil case must apprise the trial court
and the adverse party of the facts alleged by the complaint that he admits and of the facts
alleged by the complaint that he wishes to place into contention. The defendant does the
former either by stating in his answer that they are true or by failing to properly deny them.
There are two ways of denying alleged facts: one is by general denial, and the other, by
specific denial.[107]
In this jurisdiction, only a specific denial shall be sufficient to place into contention
an alleged fact.[108] Under Section 10,[109] Rule 8 of the Rules of Court, a specific denial of an
allegation of the complaint may be made in any of three ways, namely: (a) a defendant
specifies each material allegation of fact the truth of which he does not admit and, whenever
practicable, sets forth the substance of the matters upon which he relies to support his denial;
(b) a defendant who desires to deny only a part of an averment specifies so much of it as is
true and material and denies only the remainder; and (c) a defendant who is without
knowledge or information sufficient to form a belief as to the truth of a material averment
made in the complaint states so, which has the effect of a denial.
The
express
qualifications
contained
in
paragraph
2.01
of
Cojuangcos Answer constituted efficient specific denials of the averments of paragraph 2 of
the RepublicsAmended Complaint under the first method mentioned in Section 10 of Rule
8, supra. Indeed, the aforequoted paragraphs of the Amended Complaint and of
Cojuangcos Answerindicate that Cojuangco thereby expressly qualified his admission of
having been the President and a Director of the UCPB with the averment that the UCPB was a
private corporation; that his Answers allegation of his being a member of the Board of
Directors of the United Coconut Oil Mills, Inc. did not admit that he was a member of the
Board of Directors of the CIIF Oil Mills, because the United Coconut Oil Mills, Inc. was not
one of the CIIF Oil Mills; and that his Answer nowhere contained any admission or statement
that he had held the various positions in the government or in the private corporations at the
same time and in 1983, the time when the contested acquisition of the SMC shares of stock
took place.
What the Court stated in Bitong v. Court of Appeals (Fifth Division)[110] as to
admissions is illuminating:
When taken in its totality, the Amended Answer to the Amended
Petition, or even the Answer to the Amended Petition alone, clearly raises
an issue as to the legal personality of petitioner to file the
complaint. Every alleged admission is taken as an entirety of the fact
which makes for the one side with the qualifications which limit,
modify or destroy its effect on the other side. The reason for this is,
where part of a statement of a party is used against him as an admission,
the court should weigh any other portion connected with the statement,
which tends to neutralize or explain the portion which is against interest.
The Republic insists that the aforequoted portions of the joint Pre-Trial Brief were
Cojuangco, et al.s admission that:
(a) Cojuangco had received money from the UCPB, a bank entrusted by
law with the administration of the coconut levy funds; and
(b) Cojuangco had received more money from the CIIF Oil Mills in which
part of the CIIF funds had been placed, and thereby used the funds of
the UCPB and the CIIF as capital to buy his SMC shares.[112]
3.00. Based on the complaint and the answer, the acquisition of the
San Miguel shares by, and their registration in the names of, the
companies listed in Annexes A and B may be deemed undisputed.
3.01. All other allegations in the complaint are disputed.[115]
The burden of proof, according to Section 1, Rule 131 of the Rules of Court, is the
duty of a party to present evidence on the facts in issue necessary to establish his claim or
defense by the amount of evidence required by law. Here, the Republic, being the plaintiff,
was the party that carried the burden of proof. That burden required it to demonstrate through
competent evidence that the respondents, as defendants, had purchased the SMC shares of
stock with the use of public funds; and that the affected shares of stock constituted ill-gotten
wealth. The Republic was well apprised of its burden of proof, first through the joinder of
issues made by the responsive pleadings of the defendants, including Cojuangco, et al. The
Republic was further reminded through the pre-trial order and the Resolution denying
its Motion for Summary Judgment, supra, of the duty to prove the factual allegations on illgotten wealth against Cojuangco, et al., specifically the following disputed matters:
(a) When the loans or advances were incurred;
(b) The amount of the loans from the UCPB and of the credit advances
from the CIIF Oil Mills, including the specific CIIF Oil Mills
involved;
(c) The identities of the borrowers, that is, all of the respondent
corporations together, or separately; and the amounts of the
borrowings;
(d) The conditions attendant to the loans or advances, if any;
(e) The manner, form, and time of the payments made to Zobel or to the
Ayala Group, whether by check, letter of credit, or some other form;
and
(f) Whether the loans were paid, and whether the advances were
liquidated.
With the Republic nonetheless choosing not to adduce evidence proving the factual
allegations, particularly the aforementioned matters, and instead opting to pursue its claims
by Motion for Summary Judgment, the Sandiganbayan became completely deprived of the
means to know the necessary but crucial details of the transactions on the acquisition of the
contested block of shares. The Republics failure to adduce evidence shifted no burden to the
respondents to establish anything, for it was basic that the partywho asserts, not the party who
denies, must prove.[116] Indeed, in a civil action, the plaintiff has the burden of pleading every
essential fact and element of the cause of action and proving them by preponderance of
evidence. This means that if the defendant merely denies each of the plaintiffs allegations and
neither side produces evidence on any such element, the plaintiff must necessarily fail in the
action.[117] Thus, the Sandiganbayan correctly dismissed Civil Case No. 0033-F for failure of
the Republic to prove its case by preponderant evidence.
A summary judgment under Rule 35 of the Rules of Court is a procedural technique
that is proper only when there is no genuine issue as to the existence of a material fact and the
The Republics lack of proof on the source of the funds by which Cojuangco, et al. had
acquired their block of SMC shares has made it shift its position, that it now suggests that
Cojuangco had been enabled to obtain the loans by the issuance of LOI 926 exempting the
UCPB from the DOSRI and the Single Borrowers Limit restrictions.
We reject the Republics suggestion.
Firstly, as earlier pointed out, the Republic adduced no evidence on the significant
particulars of the supposed loan, like the amount, the actual borrower, the approving
official, etc. It did not also establish whether or not the loans were DOSRI[126] or issued in
violation of the Single Borrowers Limit. Secondly, the Republic could not outrightly assume
that President Marcos had issued LOI 926 for the purpose of allowing the loans by the UCPB
in favor of Cojuangco. There must be competent evidence to that effect. And, finally, the
loans, assuming that they were of a DOSRI nature or without the benefit of the required
approvals or in excess of the Single Borrowers Limit, would not be void for that reason.
Instead, the bank or the officers responsible for the approval and grant of the DOSRI loan
would be subject only to sanctions under the law. [127]
VI.
Cojuangco violated no fiduciary duties
The Republic invokes the following pertinent statutory provisions of the Civil Code,
to wit:
We need not stress that the trial courts have limited authority to render summary
judgments and may do so only in cases where no genuine issue as to any material fact clearly
exists between the parties. The rule on summary judgment does not invest the trial courts with
jurisdiction to try summarily the factual issues upon affidavits, but authorizes summary
judgment only when it appears clear that there is no genuine issue as to any material fact.[124]
IV.
Republics burden to establish by preponderance of evidence that
respondents SMC shares had been illegally acquired with coconutlevy funds was not discharged
Madame Justice Carpio Morales argues in her dissent that although the contested
SMC shares could be inescapably treated as fruits of funds that are prima facie public in
character, Cojuangco, et al. abstained from presenting countervailing evidence; and that with
the Republic having shown that the SMC shares came into fruition from coco levy funds that
are prima facie public funds, Cojuangco, et al. had to go forward with contradicting evidence,
but did not.
The Court disagrees. We cannot reverse the decision of November 28, 2007 on the basis
alone of judicial pronouncements to the effect that the coconut levy funds wereprima
facie public funds,[125] but without any competent evidence linking the acquisition of the block
of SMC shares by Cojuangco, et al. to the coconut levy funds.
V.
No violation of the DOSRI and
Single Borrowers Limit restrictions
Did Cojuangco breach his fiduciary duties as an officer and member of the Board of
Directors of the UCPB? Did his acquisition and holding of the contested SMC shares come
under a constructive trust in favor of the Republic?
The answers to these queries are in the negative.
The conditions for the application of Articles 1455 and 1456 of the Civil Code (like
the trustee using trust funds to purchase, or a person acquiring property through mistake or
fraud), and Section 31 of the Corporation Code (like a director or trustee willfully and
knowingly voting for or assenting to patently unlawful acts of the corporation, among others)
require factual foundations to be first laid out in appropriate judicial proceedings. Hence,
concluding that Cojuangco breached fiduciary duties as an officer and member of the Board of
Directors of the UCPB without competent evidence thereon would be unwarranted and
unreasonable.
Thus, the Sandiganbayan could not fairly find that Cojuangco had committed breach
of any fiduciary duties as an officer and member of the Board of Directors of the UCPB. For
one, the Amended Complaint contained no clear factual allegation on which to predicate the
application of Articles 1455 and 1456 of the Civil Code, and Section 31 of the Corporation
Code. Although the trust relationship supposedly arose from Cojuangcos being an officer and
member of the Board of Directors of the UCPB, the linkbetween this alleged fact and the
borrowings or advances was not established. Nor was there evidence on the loans or
borrowings, their amounts, the approving authority, etc. As trial court, the Sandiganbayan
could not presume his breach of fiduciary duties without evidence showing so, for fraud or
breach of trust is never presumed, but must be allegedand proved.[128]
The thrust of the Republic that the funds were borrowed or lent might even preclude
any consequent trust implication. In a contract of loan, one of the parties (creditor) delivers
money or other consumable thing to another (debtor) on the condition that the same amount of
the same kind and quality shall be paid. [129] Owing to the consumable nature of the thing
loaned, the resulting duty of the borrower in a contract of loan is to pay, not to return, to the
creditor or lender the very thing loaned. This explains why the ownership of the thing loaned
is transferred to the debtor upon perfection of the contract. [130] Ownership of the thing loaned
having transferred, the debtor enjoys all the rights conferred to an owner of property, including
the right to use and enjoy (jus utendi), to consume the thing by its use (jus abutendi), and to
dispose (jus disponendi), subject to such limitations as may be provided by law. [131] Evidently,
the resulting relationship between a creditor and debtor in a contract of loan cannot be
characterized as fiduciary.[132]
To say that a relationship is fiduciary when existing laws do not provide for such
requires evidence that confidence is reposed by one party in another who exercises dominion
and influence. Absent any special facts and circumstances proving a higher degree of
responsibility, any dealings between a lender and borrower are not fiduciary in nature. [133] This
explains why, for example, a trust receipt transaction is not classified as a simple loan and is
characterized as fiduciary, because the Trust Receipts Law (P.D. No. 115) punishes the
dishonesty and abuse of confidence in the handling of money or goods to the prejudice of
another regardless of whether the latter is the owner. [134]
Based on the foregoing, a debtor can appropriate the thing loaned without any
responsibility or duty to his creditor to return the very thing that was loaned or to report how
the proceeds were used. Nor can he be compelled to return the proceeds and fruits of the loan,
for there is nothing under our laws that compel a debtor in a contract of loan to do so. As
owner, the debtor can dispose of the thing borrowed and his act will not be considered
misappropriation of the thing. [135] The only liability on his part is to pay the loan together with
the interest that is either stipulated or provided under existing laws.
WHEREFORE, the Court dismisses the petitions for certiorari in G.R. Nos.
166859 and 169023; denies the petition for review on certiorari in G.R. No. 180702; and,
accordingly, affirms the decision promulgated by the Sandiganbayan on November 28, 2007
in Civil Case No. 0033-F.
The Court declares that the block of shares in San Miguel Corporation in the names
of respondents Cojuangco, et al. subject of Civil Case No. 0033-F is the exclusive property of
Cojuangco, et al. as registered owners.
Accordingly, the lifting and setting aside of the Writs of Sequestration affecting said
block of shares (namely: Writ of Sequestration No. 86-0062 dated April 21, 1986; Writ of
Sequestration No. 86-0069 dated April 22, 1986; Writ of Sequestration No. 86-0085 dated
May 9, 1986; Writ of Sequestration No. 86-0095 dated May 16, 1986; Writ of Sequestration
No. 86-0096 dated May 16, 1986; Writ of Sequestration No. 86-0097 dated May 16, 1986;
Writ of Sequestration No. 86-0098 dated May 16, 1986; Writ of Sequestration No. 86-0042
dated April 8, 1986; and Writ of Sequestration No. 87-0218 dated May 27, 1987) are affirmed;
and the annotation of the conditions prescribed in the Resolutions promulgated on October 8,
2003 and June 24, 2005 is cancelled.
SO ORDERED.
reconstitution and damages. The case is one of several suits involving ill-gotten or
unexplained wealth that petitioner Republic, through the PCGG, filed with the
Sandiganbayan against private respondent Roberto S. Benedicto and others pursuant
to Executive Order (EO) No. 14,[3] series of 1986.
- versus -
and
Pursuant to its mandate under EO No. 1,[4] series of 1986, the PCGG issued
G.R. No. 129406
writs placing under sequestration all business enterprises, entities and other
properties, real and personal, owned or registered in the name of private respondent
Present:
Benedicto, or of corporations in which he appeared to have controlling or majority
interest. Among the properties thus sequestered and taken over by PCGG fiscal
PUNO, J., Chairperson, agents were the 227 shares in NOGCCI owned by private respondentBenedicto and
SANDOVAL-GUTIERREZ,
registered in his name or under the names of corporations he owned or controlled.
CORONA,
AZCUNA, and
Following the sequestration process, PCGG representatives sat as members of
GARCIA, JJ.
the Board of Directors of NOGCCI, which passed, sometime in October 1986, a
resolution effecting a corporate policy change. The change consisted of assessing
a monthly membership due of P150.00 for each NOGCCI share. Prior to this
resolution, an investor purchasing more than one NOGCCI share was exempt from
Promulgated:
paying monthly membership due for the second and subsequent shares that he/she
owned.
March 6, 2006
x-------------------------- --------------x
DECISION
GARCIA, J.:
Before the Court is this petition for certiorari under Rule 65 of the Rules of
Court to nullify and set aside the March 28, 1995 [1] and March 13, 1997[2]Resolutions
of the Sandiganbayan, Second Division, in Civil Case No. 0034, insofar as said
resolutions ordered the Presidential Commission on Good Government (PCGG) to pay
private respondent Roberto S. Benedicto or his corporations the value of 227 shares
of stock of the Negros Occidental Golf and Country Club, Inc. (NOGCCI)
at P150,000.00 per share, registered in the name of said private respondent or his
corporations.
The facts:
Civil Case No. 0034 entitled Republic of the Philippines, plaintiff, v. Roberto S.
Benedicto, et al., defendants, is a complaint for reconveyance, reversion, accounting,
On February 22, 1994, Benedicto filed in Civil Case No. 0034 a Motion for
Release
from
Sequestration
Shares/Dividendspraying, inter alia,
and
Return
of
Sequestered
Owing to PCGGs failure to comply with the above directive, Benedicto filed
in Civil Case No. 0034 a Motion for Compliance dated July 25, 1995, followed by
an Ex-Parte Motion for Early Resolution dated February 12, 1996. Acting thereon, the
Sandiganbayan promulgated yet another Resolution[9] on February 23, 1996,
dispositively reading:
WHEREFORE, finding merit in the instant motion for early
resolution and considering that, indeed, the PCGG has not shown any
justifiable ground as to why it has not complied with its obligation as set
forth in the Order of December 6, 1994 up to this date and which Order
was issued pursuant to the Compromise Agreement and has already
become final and executory, accordingly, the Presidential Commission on
assailed Resolution[11] dated March 13, 1997, denied that portion of the
PCGGs Manifestation with Motion for Reconsideration concerning the subject 227
NOGCCI shares and granted Benedictos Motion to Enforce Judgment Levy.
Hence, the Republics present recourse on the sole issue of whether or not the
public respondent Sandiganbayan, Second Division, gravely abused its discretion in
holding that the PCGG is at fault for not paying the membership dues on the 227
sequestered NOGCCI shares of stock, a failing which eventually led to the foreclosure
sale thereof.
The petition lacks merit.
To begin with, PCGG itself does not dispute its being considered as a receiver
insofar as the sequestered 227 NOGCCI shares of stock are concerned.[12]PCGG also
acknowledges that as such receiver, one of its functions is to pay outstanding debts
pertaining to the sequestered entity or property,[13] in this case the 227 NOGCCI
shares in question. It contends, however, that membership dues owing to a golf club
cannot be considered as an outstanding debt for which PCGG, as receiver, must pay.
It also claims to have exercised due diligence to prevent the loss through delinquency
sale of the subject NOGCCI shares, specifically inviting attention to the injunctive
suit, i.e., Civil Case No. 5348, it filed before the RTC of Bacolod City to enjoin the
foreclosure sale of the shares.
The filing of the injunction complaint adverted to, without more, cannot
plausibly tilt the balance in favor of PCGG. To the mind of the Court, such filing is a
case of acting too little and too late. It cannot be over-emphasized that it behooved
the PCGGs fiscal agents to preserve, like a responsible father of the family, the value
of the shares of stock under their administration. But far from acting as such father,
what the fiscal agents did under the premises was to allow the element of
delinquency to set in before acting by embarking on a tedious process of going to
court after the auction sale had been announced and scheduled.
The PCGGs posture that to the owner of the sequestered shares rests the
burden of paying the membership dues is untenable. For one, it lost sight of the
reality that such dues are basically obligations attached to the shares, which, in the
final analysis, shall be made liable, thru delinquency sale in case of default in
payment of the dues. For another, the PCGG as sequestrator-receiver of such shares
is, as stressed earlier, duty bound to preserve the value of such shares. Needless to
state, adopting timely measures to obviate the loss of those shares forms part of
such duty and due diligence.
PCGGs failure to comply with the December 6, 1994 resolution prompted the
issuance of the clarificatory and/or reiteratory resolutions aforementioned.
In a last-ditch attempt to escape liability, petitioner Republic, through the
PCGG, invokes state immunity from suit.[22] As argued, the order for it to pay the
value of the delinquent shares would fix monetary liability on a government agency,
thus necessitating the appropriation of public funds to satisfy the judgment
claim.[23] But, as private respondent Benedicto correctly countered, the PCGG fails to
take stock of one of the exceptions to the state immunity principle, i.e., when the
government
itself
is
the
suitor,
as
in Civil
Case
No.
0034.
Where, as here, the State itself is no
less
the
plaintiff
in
the
main case, immunity from
suit
cannot
be
effectively
invoked. [24] For,
as jurisprudence
teaches,
when
the
State,
through
its
duly
authorized officers, takes the initiative in a suit against a private party, it
thereby descends to the level of a private individual and thus opens itself to whatever
counterclaims or defenses the latter may have against it.[25] Petitioner Republics act
of filing its complaint in Civil Case No. 0034 constitutes a waiver of its immunity from
suit. Being itself the plaintiff in that case, petitioner Republic cannot set up its
immunity against private respondent Benedictos prayers in the same case.
In fact, by entering into a Compromise Agreement with private
respondent Benedicto, petitioner Republic thereby stripped
itself
of its immunity from suit and placed itself in the same level of its adversary.
When the State enters into contract, through its officers or agents, in furtherance of a
legitimate aim and purpose and pursuant to constitutional legislative authority,
whereby mutual or reciprocal benefits accrue and rights and obligations arise
therefrom, the State may be sued even without its express consent,
precisely because by entering into a contract the sovereign descends to the level of
the citizen. Its consent to be sued is implied from the very act of entering into such
contract,[26] breach of which on its part gives the corresponding right to the other
party to the agreement.
Finally, it is apropos to stress that the Compromise Agreement in Civil Case No.
0034 envisaged the immediate recovery of alleged ill-gotten wealth without further
litigation by the government, and buying peace on the part of the aging
Benedicto.[27] Sadly, that stated objective has come to naught as not only had the
litigation continued to ensue, but, worse, private respondent Benedicto passed away
on May 15, 2000,[28] with the trial of Civil Case No. 0034 still in swing, so much so
that the late Benedicto had to be substituted by the administratrix of his estate.[29]
WHEREFORE, the instant petition is hereby DISMISSED.
SO ORDERED.
SECOND DIVISION
DEPARTMENT OF EDUCATION,
DIVISION OF ALBAY
represented by its SCHOOLS
DIVISION SUPERINTENDENT,
Petitioner,
- versus -
CELSO OATE,
Respondent.
June 8, 2007
x-----------------------------------------------------------------------------------------x
DECISION
VELASCO, JR., J.:
A little neglect may lead to great prejudice.
Education Culture and Sports (DECS; now Department of Education [DepEd]) developed and
built various school buildings and facilities on the disputed lot.
Sometime in 1991, respondent filed a reconstitution proceeding of OCT No. 2563
which was granted by the Legaspi City RTC, Branch V after due notice, publication, and
hearing. Consequently, OCT No. RO-18971[5] was issued in the name of spouses Claro Oate
and Gregoria Los Baos.
On August 26, 1991, a Deed of Extrajudicial Settlement of Estate and Cession was
executed by respondent and his three (3) sisters, namely: Melba O. Napil, Cielo O.
Lardizabal, and Maria Visia O. Maldo, who waived their successional rights in favor of
respondent Celso Oate. Asserting that the disputed lot was inherited by his father, Francisco
Oate, from the latters father, Claro Oate, by virtue of a prior partition among the three (3)
sons of Claro Oate and Gregoria Los Baos, respondent in turn claimed ownership of said lot
through the deed of extrajudicial settlement.
Meanwhile, the issue of whether respondents father, Francisco Oate, truly
acquired the disputed lot through a prior partition among Claro Oates three (3) children had
been passed upon in another case, Civil Case No. 8724 for Partition, Reconveyance and
Damages filed by the heirs of Rafael Oate before the Legaspi City RTC, Branch IX. [6] In said
case, respondent Celso Oate, the defendant, prevailed and the case was dismissed by the trial
court.
Thereafter, respondent caused Lot No. 6849 to be subdivided into five (5) lots, all
under his name, except Lot No. 6849-B which is under the name of Mariano M.
Lim. OnOctober 26, 1992, the subdivided lots were issued Transfer Certificate of Titles
(TCTs): (1) Lot No. 6849-A (13,072 square meters) under TCT No. T-83946;[7] (2) Lot No.
6849-B (3,100 square meters) under TCT No. T-84049;[8] (3) Lot No. 6849-C (10,000 square
meters) under TCT No. T-83948;[9] (4) Lot No. 6849-D (1,127 square meters) under TCT No.
T-83949;[10] and (5) Lot No. 6849-E (608 square meters) under TCT No. T-83950.[11]
The Case
This is a Petition for Review on Certiorari [1] under Rule 45 seeking to reverse and
set aside the January 14, 2004 Decision[2] of the Court of Appeals (CA) in CA-G.R. CV No.
60659, which affirmed the November 3, 1997 Decision [3] of the Legaspi City Regional Trial
Court (RTC), Branch I, declaring as null and void the December 21, 1998 Deed of
Donation[4] executed by the Municipality of Daraga, Albay in favor of petitioner, and
directing the latter to return to respondent Celso Oate the possession of the portion of land
occupied by the school site of the Daraga North Central Elementary School.
The Facts
Spouses Claro Oate and Gregoria Los Baos owned Lot No. 6849 (disputed lot)
with an area of around 27,907 square meters registered under the Torrens System of land
registration under Original Certificate of Title (OCT) No. 2563. Claro Oate had three
children, namely: Antonio, Rafael, and Francisco, all surnamed Oate. Respondent Celso
Oate is the grandson of Claro Oate, being the son of Francisco Oate.
In 1940, Bagumbayan Elementary School of Daraga was constructed on a portion of
the disputed lot. The school was eventually renamed Daraga North CentralElementary
School. The Municipality of Daraga leveled the area while petitioner Department of
On December 15, 1992, through his counsel, respondent sent a letter to petitioner
apprising it about the facts and circumstances affecting the elementary school and its
occupancy of Lot No. 6849-A with an area of 13,072 square meters. Respondent proposed to
petitioner DECS that it purchase Lot No. 6849-A at the Fair Market Value (FMV) of PhP 400
per square meter and also requested for reasonable rentals from 1960. [12] The records show
that then DECS Director IV Jovencio Revil subsequently referred the matter to the DECS
Division Superintendent Rizalina D. Saquido for investigation. [13]
On February 24, 1993, through his counsel, respondent likewise wrote to Engr.
Orlando Roces, District Engineer, Albay Engineering District about the on-going construction
projects in the school. [14] Engr. Roces then informed respondents counsel that petitioner
DECS is the owner of the school site having acquired the disputed lot by virtue of a Deed of
Donation executed by the Municipality of Daraga, Albay in favor of petitioner. [15]
Consequently,
on
March
18,
1993,
respondent
instituted
a
Complaint[16] for Annulment of Donation and/or Quieting of Title with Recovery of
Possession of Lot No. 6849 located at Barrio Bagumbayan, Daraga, Albay before the Legaspi
City RTC, docketed as Civil Case No. 8715, against petitioner DECS, Division of Albay,
represented by the Division Superintendent of Schools, Mrs. Rizalina D. Saquido; and the
Municipality of Daraga, Albay, represented by the Municipal Mayor, Honorable Cicero
Triunfante.
In its April 28, 1993 Answer, [17] the Municipality of Daraga, Albay, through Mayor
Cicero Triunfante, denied respondents ownership of the disputed lot as it alleged that
sometime in 1940, the Municipality bought said lot from Claro Oate, respondents
grandfather, and since then it had continually occupied said lot openly and publicly in the
concept of an owner until 1988 when the Municipality donated the school site to petitioner
DECS; thus asserting that it could also claim ownership also through adverse
possession. Moreover, it claimed that the disputed lot had been declared in the name of
defendant municipality in the Municipal Assessors Office under Tax Declaration No. 31954
from 1940 until 1988 for purposes of exemption from real estate
taxes. Further, defendant Municipality contended that respondent was guilty of laches and
was estopped from assailing ownership over the disputed lot.
Similarly, petitioners April 29, 1993 Answer [18] reiterated in essence the defenses
raised by the Municipality of Daraga, Albay and further contended that respondent had no
cause of action because it acquired ownership over the disputed lot by virtue of a Deed of
Donation executed on December 21, 1988 in its favor; and that respondents claim was vague
as it was derived from a void Deed of Extrajudicial Settlement of Estate and Cession disposing
of the disputed lot which was already sold to the Municipality of Daraga, Albay in
1940. Petitioner likewise assailed the issuance of a reconstituted OCT over Lot 6849 when the
lower court granted respondents petition for reconstitution without notifying petitioner.
During the ensuing trial where both parties presented documentary and testimonial
evidence, respondent testified that he came to know of the disputed lot in 1973 when he was
23 years old; that he took possession of the said lot in the same year; that he came to know that
the elementary school occupied a portion of the said lot only in 1991; and that it was only in
1992 that he came to know of the Deed of Donation executed by the Municipality of Daraga,
Albay.[19] Also, Felicito Armenta, a tenant cultivating a portion of disputed Lot 6849,
testified that respondent indeed owned said lot and the share of the crops cultivated were paid
to respondent.[20]
However, after respondent testified, defendants in said case filed a Joint Motion to
Dismiss[21] on the ground that respondents suit was against the State which was prohibited
without the latters consent. Respondent countered with his Opposition to Joint Motion to
Dismiss.[22] Subsequently, the trial court denied the Joint Motion to Dismiss, ruling that the
State had given implied consent by entering into a contract. [23]
Aside from the reconstituted OCT No. RO-18971, respondent presented the TCTs
covering the five (5) portions of the partitioned Lot 6849, Tax Declaration No. 04-00600681[24] issued for said lot, and the April 20, 1992 Certification [25] from the Office of the
Treasurer of the Municipality of Daraga, Albay attesting to respondents payment of realty
taxes for Lot 6849 from 1980 to 1990.
After respondent rested his case, the defense presented and marked their
documentary exhibits of Tax Declaration No. 30235 issued in the name of the late Claro
Oate, which was cancelled in 1938; Tax Declaration 31954, [26] which cancelled Tax
Declaration No. 30235, in the name of Municipality of Daraga with the annotation of ExOfficio Deputy Assessor Natalio Grageda attesting to the purchase by the Municipality under
Municipal Voucher No. 69, August 1940 accounts and the issuance of TCT No. 4812 in favor
of the Municipality; Tax Declaration No. 8926[27] in the name of the Municipality which
cancelled Tax Declaration No. 31954; and the subsequent Tax Declaration Nos.
22184,[28] 332,[29] and 04-006-00068.[30]
The defense presented the testimony of Mr. Jose Adra, [31] the Principal of Daraga
North Central Elementary School, who testified on the Municipalitys donation of disputed
Lot 6849 to petitioner and the improvements on said lot amounting to more than PhP 11
million; and Mrs. Toribia Milleza, [32] a retired government employee and resident of
Bagumbayan, Daraga, Albay since 1955, who testified on the Municipalitys continuous and
adverse possession of the disputed lot since 1940.
As mentioned earlier, Civil Case No. 8724 for Partition, Reconveyance and
Damages was instituted by the heirs of Rafael Oate in Legaspi City RTC, Branch IX against
Spouses Celso Oate and Allem Vellez, involving the same disputed lot. Petitioner and codefendant Municipality of Daraga, Albay were about to file a complaint for intervention in
said case, but it was overtaken by the resolution of the case on August 14, 1995 with the trial
court dismissing the complaint.
The Ruling of the RTC
On November 3, 1997, the trial court rendered a Decision in favor of respondent
Celso Oate. The dispositive portion declared, thus:
WHEREFORE, premises considered, judgment is hereby
rendered in favor of the plaintiff and against the defendants:
1.
2.
3.
4.
5.
6.
SO ORDERED.[33]
the Municipality ever existed and thus it could not have validly donated the subject property to
petitioner.
The trial court ratiocinated that it was clear that subject Lot 6849 was originally
registered under the Torrens System in the name of Spouses Claro Oate and Gregoria Los
Baos as evidenced by OCT No. RO-18971. The right of respondent Celso Oate over the
disputed lot had not been proven otherwise or overturned in Civil Case No. 8724, and this was
bolstered by the Deed of Extrajudicial Settlement of Estate and Cession, where respondents
sister waived their successional rights in his favor. Thus, the trial court ruled in favor of
respondents title. Besides, it further ruled that defendants could not assail the registered title
of respondent in a collateral proceeding.
While the Municipality of Daraga, Albay anchored its prior ownership over the
disputed lot by virtue of a sale in 1940 and mentioned TCT No. 4812 supposedly issued in its
name, it however failed to submit any deed of conveyance in its favor, as well as a copy of the
alleged TCT No. 4812. Hence, the trial court held that its claim over disputedLot 6849 was
based solely on adverse prescription which could not prevail over respondents registered title.
The trial court concluded that given these factual and evidentiary proofs, petitioner
had no right to occupy Lot 6849-A, and the Deed of Donation executed by
theMunicipality of Daraga, Albay in favor of petitioner must be nullified. Finally, the trial
court awarded PhP 50,000 to the Municipality of Daraga, Albay for the cost of landfill and
ordered that Article 448[34] of the New Civil Code be followed by the parties as petitioner was
a builder in good faith.
The Ruling of the Court of Appeals
Aggrieved, petitioner DECS and Municipality of Daraga, Albay filed their
respective Notices of Appeal [35] assailing the trial courts Decision before the CA. However,
on June 17, 1998, the appellate court declared the appeals of both petitioners abandoned and
dismissed for their failure to pay the required docket fees within the reglementary
period.[36] Petitioner then filed a Motion for Reconsideration [37] of the said June 17,
1998 Resolution and its appeal was subsequently reinstated. [38] The Municipality ofDaraga,
Albay, however, totally lost its appeal due to inaction, and the appellate court correspondingly
issued a Partial Entry of Judgment on July 9, 1998.[39]
Moreover, the appellate court held that there was no jurisdictional defect in the
reconstitution proceeding being one in rem, and in the issuance of OCT No. RO-18971 based
on the destroyed or lost OCT No. 2563, even if no notice was sent to petitioner. Thus, the CA
ruled that respondents claim of ownership over Lot 6849-A occupied by the school is
conclusive for being soundly predicated on TCT No. T-83946 which cancelled the
reconstituted OCT No. RO-18971. Furthermore, it reiterated the trial courts holding that
petitioner is precluded from attacking collaterally respondents title over the disputed lot in
this proceeding.
The CA emphasized that petitioners failure to present TCT No. 4812allegedly
issued in the name of the Municipality of Daraga, Albay in 1940 in lieu of OCT No. 2563 and
the Deed of Conveyance executed by the original owner, Claro Oate, in favor of the
Municipalitywas fatal to the defense. It reasoned that all the more had their claim of
ownership become doubtful when defendants-appellants [sic] failed to explain from their
pleadings and the evidence submitted before Us their failure to present the two
documents.[40] The appellate court concluded that given these facts, no title in the name of
Anent the issue of the applicability of Amigable v. Cuenca,[41] the CA affirmed the
doctrine enunciated in said case that to uphold the States immunity from suit would subvert
the ends of justice. In fine, the appellate court pointed out the inconvenience and
impossibility of restoring possession of Lot 6849-A to respondent considering the substantial
improvements built on said lot by the government which amounted to almost PhP 12 million;
and that the only relief available was for the government to pay just compensation in favor of
respondent computed on the basis of the value of the property at the time of the governments
taking of the land.
Through its assailed Decision, [42] the CA dismissed petitioners appeal for lack of
merit and affirmed the trial courts decision in toto. It reasoned that laches does not apply, its
application rests on the sound discretion of the court, and where the court believes that its
application would result in manifest wrong or injustice, it is constrained not to be guided
strictly by said doctrine. Besides, it opined that laches could not defeat the rights of a
registered owner.
The Issues
Hence, we have the instant petition where petitioner raises the following assignment
of errors:
I
THE COURT OF APPEALS ERRED IN AFFIRMING THE
TRIAL COURTS FINDING THAT RESPONDENTS CAUSE
OF ACTION TO RECOVER POSSESSION OF THE
SUBJECT PROPERTY IS NOT YET BARRED BY LACHES.
II
THE COURT OF APPEALS ERRED IN ACCORDING
GREAT WEIGHT ON RESPONDENTS RECONSTITUTED
ORIGINAL CERTIFICATE OF TITLE (OCT) NO. 2563
COVERING SUBJECT PROPERTY.
III
THE COURT OF APPEALS ERRED IN RULING THAT
PETITIONER MAY BE SUED IN VIOLATION OF THE
STATES IMMUNITY FROM SUIT.
IV
THE COURT OF APPEALS ERRED IN RULING THAT
PETITIONER MAY BE SUED INDEPENDENTLY OF THE
REPUBLIC OF THE PHILIPPINES.[43]
Petitioner basically raises two issuesthe application of laches and the nonsuability of the State.
The threshold issue is whether petitioner DECS can be sued in Civil Case No. 8715
without its consent. A supplementary issue is whether petitioner DECS can be sued
independently of the Republic of the Philippines.
We rule that petitioner DECS can be sued without its permission as a result of its
being privy to the Deed of Donation executed by the Municipality of Daraga, Albay over the
disputed property. When it voluntarily gave its consent to the donation, any dispute that may
arise from it would necessarily bring petitioner DECS down to the level of an ordinary citizen
of the State vulnerable to a suit by an interested or affected party. It has shed off its mantle of
immunity and relinquished and forfeited its armor of non-suability of the State. [44]
The auxiliary issue of non-joinder of the Republic of the Philippines is likewise
resolved in the negative. While it is true that petitioner is an unincorporated government
agency, and as such technically requires the Republic of the Philippines to be impleaded in
any suit against the former, nonetheless, considering our resolution of the main issue below,
this issue is deemed mooted. Besides, at this point, we deem it best to lift such procedural
technicality in order to finally resolve the long litigation this case has undergone. Moreover,
even if we give due course to said issue, we will arrive at the same ruling.
The Republic of the Philippines need not be impleaded as a party-defendant in Civil
Case
No.
8715
considering
that
it
impliedly
gave
its approval to the involvement of
petitioner DECS in the Deed of Donation. In a situation involving a contract between a
government department and a third party, the Republic of the Philippines need not be
impleaded as a party to a suit resulting from said contract as it is assumed that the authority
granted to such department to enter into such contract carries with it the full responsibility and
authority to sue and be sued in its name.
question the ownership and possession by the Municipality of the disputed lot until they died
on June 8, 1990, June 12, 1991, and October 22, 1957, respectively.
Petitioner maintains that significantly, respondent and his siblings succeeding
their father Francisco as the alleged owners, from his death on October 22, 1957also did not
take any action to recover the questioned lot from 1957 until 1993 when the instant suit was
commenced. Petitioner avers that if they were really the owners of said lot, they would not
have waited 52 long years to institute the suit assuming they have a cause of action against the
Municipality or petitioner. Thus, petitioner submits that the equitable principle of laches has
indubitably set in to bar respondents action to recover possession of, and title to, the disputed
lot.
Laches and its elements
Indeed, it is settled that rights and actions can be lost by delay and by the effect of
delay as the equitable defense of laches does not concern itself with the character of the
defendants title, but only with plaintiffs long inaction or inexcusable neglect to bar the
latters action as it would be inequitable and unjust to the defendant.
Laches is defined as the failure or neglect, for an unreasonable and unexplained
length of time, to do that whichby the exercise of due diligencecould or should have been
done earlier.[46] Verily, laches serves to deprive a party guilty of it to any judicial
remedies. Its elements are: (1) conduct on the part of the defendant, or of one under whom the
defendant claims, giving rise to the situation which the complaint seeks a remedy; (2) delay in
asserting the complainant's rights, the complainant having had knowledge or notice of the
defendant's conduct as having been afforded an opportunity to institute a suit; (3) lack of
knowledge or notice on the part of the defendant that the complainant would assert the right in
which the defendant bases the suit; and (4) injury or prejudice to the defendant in the event
relief is accorded to the complainant, or the suit is not held barred. [47]
In Felix Gochan and Sons Realty Corporation, we held that [t]hough laches
applies even to imprescriptible actions, its elements must be proved positively. Laches is
evidentiary in nature which could not be established by mere allegations in the pleadings and
can not be resolved in a motion to dismiss (emphases supplied). [48] In the same vein, we
explained in Santiago v. Court of Appeals that there is no absolute rule as to what constitutes
laches or staleness of demand; each case is to be determined according to its particular
circumstances.[49]
Issue of laches not barred by adverse judgment
against Daraga, Albay
It is unfortunate that defendant Municipality of Daraga, Albay lost its appeal in CAG.R. CV No. 60659 before the CA for its failure to pay the required docket fees within the
reglementary period. As a result, a Partial Entry of Judgment was made on July 9, 1998 and
consequently, the dispositions in the November 3, 1997 Decision, rendered by the Legaspi
City RTC, Branch I in favor of respondent Celso Oate, became final and executory as against
defendant Municipality of Daraga, Albay.
As an off-shoot, with respect to the Municipality of Daraga, the Deed of Donation in
favor of petitioner DECS was annulledrespondent Oate was declared owner in fee simple
of the disputed lots and entitled to possession but was required to pay PhP 50,000 to the
Daraga Municipal Government and the costs of suit. By reason of the finality of the Decision
against the Municipality of Daraga, Tax Declaration Nos. 04-006-00068, 332, 22184, 31954,
and 8926 are all cancelled and annulled (if not yet cancelled).
What are the effects of the final judgment against Municipality of Daraga on its codefendant, petitioner DECS?
Generally, it has no impact on the appeal of DECS unless the decision affects its
defenses. In this petition, DECS no longer questions the declaration of nullity of the Deed of
Donation over the disputed lot and hence can be considered as a final resolution of the
issue. Likewise, it does not challenge the ownership of Oate of the disputed lots, but merely
relied on the defense of laches. The final directive for Municipality of Daraga to return
possession of the land has no significance on DECS appeal since precisely, it is DECS
position that it should retain possession of the land. From these considerations, the final RTC
November 3, 1997 Decision against the Municipality of Daraga has no substantial and
material effect upon the DECS appeal.
The only remaining issue left is whether laches can inure to the benefit of petitioner
DECS considering the fact that Lot No. 6849-A was devoted to public education when the
elementary school was built in 1940 under the supervision and control of DECS up to 1993
when Civil Case No. 8715 was filed by respondent Oate.
We rule in the affirmative.
Laches has set in
A brief scrutiny of the records does show tell-tale signs of laches. The first element
is undisputed: the then Bagumbayan Elementary School of Daraga was constructed in 1940 on
a portion of disputed Lot 6849, specifically Lot No. 6849-A containing 13,072 square meters
under TCT No. T-83946. Moreover, Mrs. Toribia Milleza, [50] a retired government employee
and resident of Bagumbayan, Daraga since 1955 pertinently testified, thus:
Q: How long have you been residing in this place,
Bagumbayan, Daraga, Albay?
A: Maybe I stayed there in 1955 until the present. [51]
xxxx
Q: Now, can you further recall the kind of building that
was
constructed in this property?
A: Seva type, building.
Q: At present how many buildings were constructed in
this
property?
A: Plenty of school buildings.
Q: Now, how many buildings were first constructed in [sic]
this property?
A: In 1955 only one, the Seva type, then there was constructed
five
(5) Marcos Type buildings during the Marcos time. [52]
The devotion of Lot No. 6849-A to education started in 1940 and continued up to
December 21, 1988 when said lot was donated to the DECS. From then on, DECS built
various buildings and introduced improvements on said lot. Lot No. 6849-A was continuously
used for public education until March 18, 1993 when respondent Oate filed Civil Case No.
8715 and thereafter up to the present.
Thus, for a total period of more than fifty-two (52) years, Lot No. 6849-A was
exclusively and completely utilized by DECS for public education. This fact was not
successfully challenged nor refuted by respondent.
The second element of laches was likewise proven. No evidence was presented to
show that respondent or his predecessors-in-interest ever took any action, administrative or
judicial, nor either party questioned or protested the Municipalitys adverse occupation of a
portion of Lot 6849. As petitioner had demonstrated laches by persuasive and credible
evidence, it is incumbent upon respondent to show that his predecessors-in-interest indeed
protected their rights of ownership over the lot. Thus, as early as 1940, when the first Seva
type school building was constructed over a portion of the disputed lot, now Lot 6849-A,
respondent must prove that his predecessors-in-interest indeed undertook activities to contest
the occupation of the portion of the lot by the Municipality and subsequently by petitioner
DECS. Unfortunately, respondent failed to substantiate such defense of ownership and
possession of the lot and even skirted this issue.
Respondent testified that he came to know of Lot 6849 only in 1973 when he was 23
years old.[53] He asserted that he took possession of said lot in the same year when his two (2)
uncles, the brothers of his late father, passed on to him the disputed lot as his fathers share of
the inheritance from the late Claro Oate and Gregoria Los Baos (his
grandparents). However, it is interesting to note that he testified that he only came to know in
1991 that the elementary school was built on a portion of Lot 6849, now Lot 6849-A. These
assertions are irreconcilable. Common experience tells us that one who owns a property and
takes possession of it cannot fail to discover and know that an existing elementary school was
built and standing on the lot from the time that the owner starts possessing a property.
Nonetheless, even granting that respondent indeed only came to know of such
encroachment or occupation in 1991, his rights cannot be better than that of his predecessorsin-interest, that is, Claro Oate and his uncles, Antonio and Rafael, who died in 1990 and
1991, respectively. Since respondents right over the lot originated from his predecessors-ininterest, then he cannot have better rights over Lot No. 6849-A than the latter. The spring
cannot rise higher than its source. Besides, respondent has not proffered any explanation why
his predecessors-in-interest did not protest and challenge the Municipalitys occupancy over a
portion of their lot. Verily, with the span of around 52 years afforded respondent and his
predecessors-in-interest, their inaction and delay in protecting their rights were certainly
excessive and unjustified.
In the third element, the records clearly bear out the fact that petitioner DECS did
not know nor anticipate that their possession and occupancy of a portion of Lot 6849 would
later be questioned. In fact, petitioner built additional school buildings and facilities on the
school site amounting to more than PhP 11 million. Mr. Jose Adra, School Principal of
the Daraga North Central Elementary School, testified on the donation of the disputed lot to
petitioner and the cost of the improvements on it. [54] After more than forty-eight (48) years of
unquestioned, peaceful, and uninterrupted possession by petitioner DECS, it had no
knowledge nor reason to believe that respondent would assert any right over the lot after the
lapse of such long occupation coupled with a tax declaration in the name of the Daraga
Municipality.
Finally, the last element is likewise proven by the antecedent facts that clearly show
grave prejudice to the government, in general, and to petitioner, in particular, if the instant
action is not barred without even considering the cost of the construction of the school
buildings and facilities and the deleterious effect on the school children and affected school
teachers and personnel if Lot No. 6849-A would be returned to respondent.
Verily, the application of laches is addressed to the sound discretion of the court as
its application is controlled by equitable considerations. In the instant case, with the foregoing
considerations, we are constrained from giving approbation to the trial and appellate courts
ruling that the application of the principle of laches would subvert the ends of justice. Indeed,
it is unjust for the State and the affected citizenry to suffer after respondent and his
predecessors-in-interest had slept on their rights for 52 years.
Also, the inaction of respondent Oate and his predecessors-in-interest for over 50
years has reduced their right to regain possession of Lot 6849-A to a stale demand.
Laches holds over the actual area possessed and occupied by petitioner
We, however, make the clear distinction that laches applies in favor of petitioner
only as regards Lot 6849-A which is actually possessed and occupied by it. Laches does not
apply to Lot Nos. 6849-B, 6849-C, 6849-D, and 6849-E. These portions were never occupied
by the Municipality and petitioner. Agricultural tenant Felicito Armenta testified that his
father, Antonio Armenta, started cultivating portions of Lot 6849 way back in the 1940s and
that he took over the tenancy in 1960 when his father stopped tilling the land. Besides, if the
Municipality indeed owned Lot 6849 by virtue of a purchase, it is likewise guilty of laches in
not protecting or contesting the cultivation by Oates agricultural tenants of said portions
of Lot 6849.
Transfer Certificates of Title on portions of Lot 6849 valid
Petitioner contends that the reconstitution of OCT No. 2563covering subject lot in
1991 or 52 years after the Municipality owned said lotdoes not in any way affect the latters
preferential and superior right over the disputed lot. In the same vein, it maintains that it is
inconsequential that petitioner and the Municipality failed to present as evidence the deed of
conveyance in favor of the Municipality, as well as TCT No. 4812 as a registered land owner
may lose the right to recover possession of a registered property by reason of
laches. Petitioner concludes that the long delayed reconstitution of OCT No. 2563 by
respondent was a mere afterthought and intended to camouflage his and his predecessors
unreasonably long inaction which indicates an awareness that they have no valid claim
whatsoever over disputed Lot 6849.
We disagree.
It must be noted that a reconstitution proceeding is one in rem and is thus binding to
the whole world. While it is true that laches has set in so far as it pertains to the portion of Lot
6849, specifically Lot 6849-A where the Municipality and petitioner DECS had constructed
the existing school, such does not hold true for the totality of Lot 6849 as explained
above. Indeed, the reconstitution proceeding being one in rem, the consequent issuance of
OCT No. RO-18971 in lieu of the lost or destroyed OCT No. 2563 is valid.
Anent the issue of non-notification, we agree with the observation of the courts a
quo that even granting arguendo that petitioner was not notified about the reconstitution
proceeding, such deficiency is not jurisdictional as to nullify and prevail over the final
disposition of the trial court in a proceeding in rem.
More so, while petitioner strongly asserts that the certification in Tax Declaration
No. 31954 attesting to the payment of the disputed lot under Municipal Voucher No. 69 and
the issuance of TCT No. 4812, which was never disputed nor controverted by respondent,
should have been given evidentiary weight by the trial and appellate courts as the
presumptions of regularity and validity of such official act have not been overcome, such
documents cannot defeat the registered title of respondent.
Between a clear showing of ownership evidenced by a registered title and a
certification in a tax declaration, albeit done in an official capacity, the former holds as the
latter is only persuasive evidence. Indeed, tax declarations in land cases per se do not
constitute ownership without other substantial pieces of evidence.
The records do not show and petitioner has not given any cogent explanation why
the Deed of Conveyance in favor of the Municipality of Daraga, Albay and TCT No. 4812
were not presented. With clear and affirmative defenses set up by petitioner
and Municipality of Daraga, Albay, it is incumbent for them to present these documents.
Therefore, the unmistakable inference is that there was indeed no sale and conveyance by
Claro Oate of Lot 6849 in favor of the Municipality. Consequently, the TCTs cancelling
OCT No. RO-18971 covering Lot Nos. 6849-A, 6849-B, 6849-C, 6849-D, and 6849-E were
likewise validly issued.
Thus, notwithstanding valid titles over the portions of Lot 6849, respondent Oate
cannot now take possession over Lot No. 6849-A for reason of laches. In the recent case
of De Vera-Cruz v. Miguel, we reiterated the principle we have consistently applied in laches:
The law[55] provides that no title to registered land in derogation
of that of the registered owner can be acquired by prescription or adverse
possession. Nonetheless, while it is true that a Torrens Title is
indefeasible and imprescriptible, the registered landowner may lose his
right to recover the possession of his registered property by reason
of laches.[56]
Thus, with our resolution of the principal issue of applicability of the equitable
remedy of laches, the issue of suability of the State has been mooted.
A final word. Considering our foregoing disquisition and upon grounds of equity, a
modification of the final decision prevailing between respondent Oate and
theMunicipality of Daraga, Albay is in order. It would be grossly iniquitous for respondent
Oate to pay PhP 50,000 to the Municipality of Daraga, Albay considering that he is not
entitled to recover the possession and usufruct of Lot No. 6849-A.
WHEREFORE, the instant petition is GRANTED and the January 14, 2004
Decision of the CA in CA-G.R. CV No. 60659 affirming the November 3, 1997 Decision of
the Legaspi City RTC is AFFIRMED with the following MODIFICATIONS:
1)
Declaring the DepEd (formerly DECS), Division of Albay to have the rights
of possession and usufruct over Lot 6849-A with an area of 13,072 square meters under TCT
No. T-83946 of the Registry of Deeds of Albay, as a result of laches on the part of respondent
Celso Oate and his predecessors-in-interest. Respondent Celso Oate, his heirs, assigns, and
successors-in-interest are prohibited from selling, mortgaging, or encumbering Lot 6849-A
while the said lot is still being used and occupied by petitioner DECS. However, the rights of
possession and usufruct will be restored to respondent the moment petitioner DECS no longer
needs the said lot. The Registry of Deeds of Albay is ordered to annotate the aforementioned
restrictions and conditions at the back of TCT No. T-83946-A in the name of respondent Celso
Oate. Item No. 2 of the November 3, 1997 Decision of the Legaspi City RTC is modified
accordingly;
2)
Declaring Celso Oate as the true and legal owner in fee simple of the
following lots:
DECISION
a.
Lot 6849-C with an area of 10,000 square meters under
TCT No. T-83948 of the Registry of Deeds of Albay;
GARCIA, J.:
b.
Lot 6849-D with an area of 1,127 square meters under
TCT No. T-83949 of the Registry of Deeds of Albay; and
Via this verified petition for certiorari and prohibition under Rule 65 of the Rules of
Court, the Republic of the Philippines (Republic, for short), thru the Office of the Solicitor
General (OSG), comes to this Court to nullify and set aside the decision dated August 27,
2003 and other related issuances of the Regional Trial Court (RTC) of Manila, Branch 37, in
its Civil Case No. 99-94075. In directly invoking the Courts original jurisdiction to issue the
extraordinary writs of certiorari and prohibition, without challenge from any of the
respondents, the Republic gave as justification therefor the fact that the case involves an
over TWO BILLION PESO judgment against the State, allegedly rendered in blatant
violation of the Constitution, law and jurisprudence.
c.
Lot 6849-E with an area of 608 square meters under TCT
No. T-83950 of the Registry of Deeds of Albay.
3)
Declaring Mariano M. Lim as true and legal owner of Lot 6849-B with an
area of 3,100 square meters under TCT No. T-84049 of the Registry of Deeds of Albay;
4)
Ordering petitioner DECS and all other persons claiming under said
department to return the possession of Lots 6849-C, 6849-D, and 6849-E to respondent Celso
Oate and Lot 6849-B to Mariano M. Lim; and
5)
Deleting Item No. 4 of the November 3, 1997 Decision of the Legaspi City
RTC, which ordered respondent Celso Oate to pay Fifty Thousand Pesos (PhP 50,000) to
defendant Municipality of Daraga, Albay.
The November 3, 1997 Decision of the Legaspi City RTC is AFFIRMED in all
other respects.
No costs.
SO ORDERED.
- versus -
At the core of the litigation is a 4,924.60-square meter lot once covered by Transfer
Certificate of Title (TCT) No. 118527 of the Registry of Deeds of Manila in the name of the
herein private respondent Tarcila Laperal Mendoza (Mendoza), married to Perfecto Mendoza.
The lot is situated at No. 1440 Arlegui St., San Miguel, Manila, near the Malacaang Palace
complex. On this lot, hereinafter referred to as the Arlegui property, now stands the
Presidential Guest House which was home to two (2) former Presidents of the Republic and
now appears to be used as office building of the Office of the President. [1]
The facts:
FIRST DIVISION
REPUBLIC OF THE PHILIPPINES,
Petitioner,
By any standard, the case indeed involves a colossal sum of money which, on the face
of the assailed decision, shall be the liability of the national government or, in fine, the
taxpayers. This consideration, juxtaposed with the constitutional and legal questions
surrounding the controversy, presents special and compelling reasons of public interests why
direct recourse to the Court should be allowed, as an exception to the policy on hierarchy of
courts.
PUNO, C.J.,Chairperson,
SANDOVAL-GUTIERREZ,
CORONA,
AZCUNA, and
GARCIA, JJ.
Sometime in June 1999, Mendoza filed a suit with the RTC of Manila for reconveyance
and the corresponding declaration of nullity of a deed of sale and title against the Republic,
the Register of Deeds of Manila and one Atty. Fidel Vivar. In her complaint, as later
amended, docketed as Civil Case No. 99-94075 and eventually raffled to Branch 35 of the
court, Mendoza essentially alleged being the owner of the disputed Arlegui property which
the Republic forcibly dispossessed her of and over which the Register of Deeds of Manila
issued TCT No. 118911 in the name of the Republic.
Answering, the Republic set up, among other affirmative defenses, the States
immunity from suit.
with a five (5%) per cent yearly increase, plus interest thereon at the legal
rate, beginning July 1975 until it finally vacates the same;
The intervening legal tussles are not essential to this narration. What is material is that
in an Order of March 17, 2000, the RTC of Manila, Branch 35, dismissed Mendozas
complaint. The court would also deny, in another order dated May 12, 2000, Mendozas
omnibus motion for reconsideration. On a petition for certiorari, however, the Court of
Appeals (CA), in CA-G.R. SP No. 60749, reversed the trial courts assailed orders and
remanded the case to the court a quo for further proceedings.[2] On appeal, this Court, in G.R.
No. 155231, sustained the CAs reversal action. [3]
From Branch 35 of the trial court whose then presiding judge inhibited himself from
hearing the remanded Civil Case No. 99-94075, the case was re-raffled to Branch 37 thereof,
presided by the respondent judge.
On May 5, 2003, Mendoza filed a Motion for Leave of Court to file a Third Amended
Complaint with a copy of the intended third amended complaint thereto attached. In the May
16, 2003 setting to hear the motion, the RTC, in open court and in the presence of the
Republics counsel, admitted the third amended complaint, ordered the Republic to file its
answer thereto within five (5) days from May 16, 2003 and set a date for pre-trial.
In her adverted third amended complaint for recovery and reconveyance of the Arlegui
property, Mendoza sought the declaration of nullity of a supposed deed of sale dated July 15,
1975 which provided the instrumentation toward the issuance of TCT No. 118911 in the name
of the Republic. And aside from the cancellation of TCT No. 118911, Mendoza also asked for
the reinstatement of her TCT No. 118527. [4] In the same third amended complaint, Mendoza
averred that, since time immemorial, she and her predecessors-in-interest had been in peaceful
and adverse possession of the property as well as of the owners duplicate copy of TCT No.
118527. Such possession, she added, continued until the first week of July 1975 when a
group of armed men representing themselves to be members of the Presidential Security
Group [PSG] of the then President Ferdinand E. Marcos, had forcibly entered [her] residence
and ordered [her] to turn over to them her Copy of TCT No. 118525 and compelled her
and the members of her household to vacate the same ; thus, out of fear for their lives, [she]
handed her Owners Duplicate Certificate Copy of TCT No. 118527 and had left and/or
vacated the subject property. Mendoza further alleged the following:
On May 21, 2003, the Republic, represented by the OSG, filed a Motion for Extension
(With Motion for Cancellation of scheduled pre-trial). In it, the Republic manifested its
inability to simply adopt its previous answer and, accordingly, asked that it be given a period of
thirty (30) days from May 21, 2003 or until June 20, 2003 within which to submit an
Answer.[5] June 20, 2003 came and went, but no answer was filed. On July 18, 2003 and again
on August 19, 2003, the OSG moved for a 30-day extension at each instance. The filing of the
last two motions for extension proved to be an idle gesture, however, since the trial
court had meanwhile issued an order[6] dated July 7, 2003 declaring the petitioner Republic as
in default and allowing the private respondent to present her evidence ex-parte.
The evidence for the private respondent, as plaintiff a quo, consisted of her testimony
denying having executed the alleged deed of sale dated July 15, 1975 which paved the way for
the issuance of TCT No. 118911. According to her, said deed is fictitious or inexistent, as
evidenced by separate certifications, the first (Exh. E), issued by the Register
of Deeds for Manila and the second (Exh. F), by the Office of Clerk of Court, RTC
Manila. Exhibit E[7] states that a copy of the supposed conveying deed cannot, despite
diligent efforts of records personnel, be located, while Exhibit F[8] states that Fidel Vivar was
not a commissioned notary public for and in the City of Manila for the year 1975. Three other
witnesses[9] testified, albeit their testimonies revolved around the appraisal and rental values of
the Arlegui property.
Eventually, the trial court rendered a judgment by default [10] for Mendoza and against the
Republic. To the trial court, the Republic had veritably confiscated Mendozas property, and
deprived her not only of the use thereof but also denied her of the income she could have had
otherwise realized during all the years she was illegally dispossessed of the same.
Dated August 27, 2003, the trial courts decision dispositively reads as follows:
1. Per verification, TCT No. 118527 had already been cancelled by virtue of a deed of
sale in favor of the Republic allegedly executed by her and her deceased husband on July 15,
1975 and acknowledged before Fidel Vivar which deed was annotated at the back of TCT No.
118527 under PE: 2035/T-118911 dated July 28, 1975; and
2.
3.
2. That the aforementioned deed of sale is fictitious as she (Mendoza) and her husband
have not executed any deed of conveyance covering the disputed property in favor of the
Republic, let alone appearing before Fidel Vivar.
4.
5.
6.
3.
December 19, 2003 - - Order[15] granting the private respondents motion for
execution.
4.
Subsequently, the Republic moved for, but was denied, a new trial per order of the trial
court of October 7, 2003. [11] Denied also was its subsequent plea for reconsideration. [12] These
twin denial orders were followed by several orders and processes issued by the trial court on
separate dates as hereunder indicated:
1.
2.
November 27, 2003 - - Certificate of Finality declaring the August 27, 2003
decision final and executory. [13]
December 17, 2003 - - Order denying the Notice of Appeal filed on
November 27, 2003, the same having been filed beyond the reglementary
period.[14]
jurisdiction.[22] The abuse must be of such degree as to amount to an evasion of a positive duty
or a virtual refusal to perform a duty enjoined by law, as where the power is exercised in a
capricious manner. The word capricious, usually used in tandem with arbitrary, conveys
the notion of willful and unreasoning action. [23]
Under the premises, the mere issuance by the trial court of the order of default followed
by a judgment by default can easily be sustained as correct and doubtless within its
jurisdiction. Surely, a disposition directing the Republic to pay an enormous sum without the
trial court hearing its side does not, without more, vitiate, on due procedural ground, the
validity of the default judgment. The petitioner may have indeed been deprived of such
hearing, but this does not mean that its right to due process had been violated. For, consequent
to being declared in default, the defaulting defendant is deemed to have waived his right to
be heard or to take part in the trial. The handling solicitors simply squandered the Republics
opportunity to be heard. But more importantly, the law itself imposes such deprivation of the
right to participate as a form of penalty against one unwilling without justification to join issue
upon the allegations tendered by the plaintiff.
And going to another point, the petitioner would ascribe jurisdictional error on the
respondent judge for denying its motion for new trial based on any or a mix of the following
factors, viz., (1) the failure to file an answer is attributable to the negligence of the former
handling solicitor; (2) the meritorious nature of the petitioners defense; and (3) the value of
the property involved.
The Court is not convinced. Even as the Court particularly notes what the trial court had
said on the matter of negligence: that all of the petitioners pleadings below bear at least three
signatures, that of the handling solicitor, the assistant solicitor and the Solicitor General
himself, and hence accountability should go up all the way to the top of the totem pole of
authority, the cited reasons advanced by the petitioner for a new trial are not recognized under
Section 1, Rule 37 of the Rules of Court for such recourse. [24]Withal, there is no cogent reason
to disturb the denial by the trial court of the motion for new trial and the denial of the
reiterative motion for reconsideration.
Then, too, the issuance by the trial court of the Order dated December 17,
2003[25] denying the petitioners notice of appeal after the court caused the issuance on
November 27, 2003 of a certificate of finality of its August 27, 2003 decision can hardly be
described as arbitrary, as the petitioner would have this Court believe. In this regard, the Court
takes stock of the following key events and material dates set forth in the assailed December
17, 2003 order, supra: (a) The petitioner, thru the OSG, received onAugust 29, 2003 a copy of
the RTC decision in this case, hence had up to September 13, 2003, a Saturday, within which
to perfect an appeal; (b) On September 15, 2003, a Monday, the OSG filed its motion for new
trial, which the RTC denied, the OSG receiving a copy of the order of denial on October 9,
2003; and (c) On October 24, 2003, the OSG sought reconsideration of the order denying the
motion for new trial. The motion for reconsideration was denied per Order dated November
25, 2003, a copy of which the OSG received on the same date.
Given the foregoing time perspective, what the trial court wrote in its aforementioned
impugned order of December 17, 2003 merits approval:
In the case at bar, it is clear that the motion for new trial filed on the
fifteenth (15th) day after the decision was received on August 29, 2003
was denied and the moving party has only the remaining period from
notice of notice of denial within which to file a notice of appeal. xxx
As may be noted, private respondent fixed the assessed value of her Arlegui
property at P2,388,990.00. And in the prayer portion of her third amended complaint for
recovery, she asked to be restored to the possession of her property and that the petitioner be
ordered to pay her, as reasonable compensation or rental use or occupancy thereof, the sum
of P500,000.00 a month, or P6 Million a year, with a five percent (5%) yearly increase plus
interest at the legal rate beginning July 1975. From July 1975 when the PSG allegedly took
over the subject property to July 2003, a month before the trial court rendered judgment, or a
period of 28 years, private respondents total rental claim would, per the OSGs computation,
only amount to P371,440,426.00. In its assailed decision, however, the trial court ordered the
petitioner to pay private respondent the total amount of over P1.48 Billion or the mindboggling amount of P1,480,627,688.00, to be exact, representing the reasonable rental for the
property, the interest rate thereon at the legal rate and the opportunity cost. This figure is on
top of the P143,600,000.00 which represents the acquisition cost of the disputed property. All
told, the trial court would have the Republic pay the total amount of about P1.624 Billion,
exclusive of interest, for the taking of a property with a declared assessed value
of P2,388,900.00. This is not to mention the award of attorneys fees in an amount equivalent
to 15% of the amount due the private respondent.
which took it for a public purposes without instituting expropriation proceedings or paying any
compensation for the lot, the Court, citing Herrera v. Auditor General,[34] ordered payment of
just compensation but in the form of interest when a return of the property was no longer
feasible.
In doing so, the respondent judge brazenly went around the explicit command of Rule 9,
Section 3(d) of the Rules of Court [30] which defines the extent of the relief that may be
awarded in a judgment by default, i.e., only so much as has been alleged and proved. The
court acts in excess of jurisdiction if it awards an amount beyond the claim made in the
complaint or beyond that proved by the evidence. [31] While a defaulted defendant may be said
to be at the mercy of the trial court, the Rules of Court and certainly the imperatives of fair
play see to it that any decision against him must be in accordance with law. [32] In the abstract,
this means that the judgment must not be characterized by outrageous one-sidedness, but by
what is fair, just and equitable that always underlie the enactment of a law.
Albeit title to the Arlegui property remains in the name of the petitioner Republic, it is
actually the Office of the President which has beneficial possession of and use over it since
the 1975 takeover. Accordingly, and in accord with the elementary sense of justice, it
behooves that office to make the appropriate budgetary arrangements towards paying private
respondent what is due her under the premises. This, to us, is the right thing to do. The
imperatives of fair dealing demand no less. And the Court would be remiss in the discharge of
its duties as dispenser of justice if it does not exhort the Office of the President to comply with
what, in law and equity, is its obligation. If the same office will undertake to pay its obligation
with reasonable dispatch or in a manner acceptable to the private respondent, then simple
justice, while perhaps delayed, will have its day. Private respondent is in the twilight of her
life, being now over 90 years of age. [39] Any delay in the implementation of this disposition
would be a bitter cut.
Given the above perspective, the obvious question that comes to mind is the level of
compensation which for the use and occupancy of the Arlegui property - would be fair to
both the petitioner and the private respondent and, at the same time, be within acceptable
legal bounds. The process of balancing the interests of both parties is not an easy one. But
surely, the Arlegui property cannot possibly be assigned, even perhaps at the present real
estate business standards, a monthly rental value of at least P500,000.00 orP6,000,000.00 a
year, the amount private respondent particularly sought and attempted to prove. This asking
figure is clearly unconscionable, if not downright ridiculous, attendant circumstances
considered. To the Court, an award of P20,000.00 a month for the use and occupancy of
the Arlegui property, while perhaps a little bit arbitrary, is reasonable and may be
granted pro hac vice considering the following hard realities which the Court takes stock of:
1.
2.
3.
The property is relatively small in terms of actual area and had an assessed
value of only P2,388,900.00;
What the martial law regime took over was not exactly an area with a new and
imposing structure, if there was any; and
The Arlegui
property had
minimal
rental
value
during
the
relatively long martial law years, given the very restrictive entry and egress
conditions prevailing at the vicinity at that time and even after.
To be sure, the grant of monetary award is not without parallel. In Alfonso v. Pasay
City,[33] a case where a registered owner also lost possession of a piece of lot to a municipality
The award of attorneys fees equivalent to 15% of the amount due the private
respondent, as reduced herein, is affirmed.
The assessment of costs of suit against the petitioner is, however, nullified, costs not
being allowed against the Republic, unless otherwise provided by law. [35]
The assailed trial courts issuance of the writ of execution[36] against government funds
to satisfy its money judgment is also nullified. It is basic that government funds and properties
may not be seized under writs of execution or garnishment to satisfy such
judgments.[37] Republic v. Palacio[38] teaches that a judgment against the State generally
operates merely to liquidate and establish the plaintiffs claim in the absence of express
provision; otherwise, they can not be enforced by processes of law.
WHEREFORE, the decision of the Regional Trial Court of Manila dated August 27,
2003 insofar as it nullified TCT No. 118911 of petitioner Republic of the Philippines and
ordered the Register of Deeds of Manila to reinstate private respondent Tarcila L. Mendozas
TCT No. 118527, or to issue her a new certificate of title is AFFIRMED. Should it be
necessary, the Register of Deeds of Manila shall execute the necessary conveying deed to
effect the reinstatement of title or the issuance of a new title to her.
It is MODIFIED in the sense that for the use and occupancy of the Arlegui property,
petitioner Republic is ordered to pay private respondent the reasonable amount ofP20,000.00 a
month beginning July 1975 until it vacates the same and the possession thereof restored to the
private respondent, plus an additional interest of 6% per annum on the total amount due upon
the finality of this Decision until the same is fully paid. Petitioner is further ordered to pay
private respondent attorney's fees equivalent to 15% of the amount due her under the
premises.
Accordingly, a writ of certiorari is hereby ISSUED in the sense that:
1. The respondent courts assailed decision of August 27, 2003 insofar as it ordered the
petitioner Republic of the Philippines to pay private respondent Tarcila L. Mendoza the sum of
One Billion Four Hundred Eighty Million Six Hundred Twenty Seven Thousand Six Hundred
Eighty Eight Pesos (P1,480,627,688.00) representing the purported rental use of the property
in question, the interest thereon and the opportunity cost at the rate of 3% per annum plus the
interest at the legal rate added thereon is nullified. The portion assessing the petitioner
Republic for costs of suit is also declared null and void.
2. The Order of the respondent court dated December 19, 2003 for the issuance of a
writ of execution and the Writ of Execution dated December 22, 2003 against government
funds are hereby declared null and void. Accordingly, the presiding judge of the respondent
court, the private respondent, their agents and persons acting for and in their behalves are
permanently enjoined from enforcing said writ of execution.
However, consistent with the basic tenets of justice, fairness and equity, petitioner
Republic, thru the Office of the President, is hereby strongly enjoined to take the necessary
steps, and, with reasonable dispatch, make the appropriate budgetary arrangements to pay
private respondent Tarcila L. Mendoza or her assigns the amount adjudged due her under this
disposition.
SO ORDERED.
SECOND DIVISION
TERESITA M. YUJUICO,
Petitioner,
TINGA, J.:
DECISION
Present:
- versus -
PUNO, J.,
Chairman,
AUSTRIA-MARTINEZ,
CALLEJO, SR.,
TINGA, and
CHICO-NAZARIO, JJ.
2.)
3.)
It is worthy of note that the records of this case clearly show that the
same counsel, the OCLO, represented the City in the expropriation case and
now, all except one of the individual respondents in the case at bar. Worthy
of note are the following manifestations relied upon by the lower court in
issuing the order on the motion to quash the Notice of Garnishment over the
funds of the City, to wit:
The Motion to Quash Notice of Garnishment was heard
by this court this morning and Atty. Joseph Aquino appeared
for the plaintiff (City of Manila) and Atty. Federico Alday, for
the defendant. Atty. Aquino manifested that the amount
of Thirty Six Million Four Hundred Three Thousand One
Hundred Seventy Pesos (P36,403,170.00) had been
appropriated by the City School Board (CSB) under CSB
Resolution Nos. 613 and 623 for this purpose.
....
Upon manifestation of the counsel for the
plaintiff that it is the City School Board which has the
authority to pass a resolution allocating funds for the full
satisfaction of the just compensation fixed, the said body
is hereby given thirty (30) days from receipt of this Order to
pass the necessary resolution for the payments of the
remaining balance due to defendant Teresita M. Yujuico.
(Emphasis supplied.)[77]
The manifestation was made by the same counsel now claiming that
it is actually the City which should be made liable for the payment of its own
obligations. This, after it trotted out the CSB as the entity with authority to
pass a resolution that would satisfy the obligation it had vigorously pursued.
The above circumstances, coupled with the rule that an act
performed by counsel within the scope of a general or implied authority is
regarded as an act of the client,[78] render the City and, through it,
respondents in estoppel. By estoppel is meant that an admission or
representation is rendered conclusive upon the person making it and cannot
be denied or disproved as against the person relying thereon. [79] Petitioner
and the courts acted in accordance with the Citys own manifestations by
running after the CSB. At this point, respondents and the OCLO can no
longer turn around and toss the obligation back to the City. After all, it was
the legal counsel of both the City and respondents who made a big
production out of showing that the liability incurred by the City will be borne
by the CSB.
Contrary to respondents claim, the law does not make the CSB an
entity independent from the City of Manila. This is evident from the
provisions of the Local Government Code of 1991, the law providing for the
creation of school boards. It states:
98. Creation,
Composition
and
(a)
There shall be established in
every province, city or municipality a provincial, city, or
municipal school board, respectively.
(b)
The composition of local
school boards shall be as follows:
...
(2) The city school board shall be composed of the
city mayor and the city superintendent of schools as
co-chairmen; the chairman of the education
committee of the sangguniang panlungsod, the city
treasurer, the representative of the pederasyon ng
mga sangguniang kabataan in the sangguniang
panlungsod, the duly elected president of the city
federation of parents-teachers associations, the duly
elected
representative
of
the
non-academic
personnel of public schools in the city, as members;
...
Section 101. Compensation and Remuneration.The co-chairmen and members of the provincial, city or
municipal school board shall perform their duties as such
without compensation or remuneration. Members thereof
who are not government officials or employees shall be
entitled to traveling expenses and allowances chargeable
against the funds of the local school board concerned,
subject to existing accounting and auditing rules and
regulations.[80]
The fact that the highest ranking official of a local government unit
(LGU) is designated as co-chairman of the school board negates the claim in
this case that the CSB has a personality separate and distinct from the City.
The other fact that government officials in the school board do not receive
any compensation or remuneration while NGO representatives merely receive
allowances underscores the absurdity of respondents argument all the more.
Indeed, such would not be the situation if the school board has a personality
separate and distinct from the LGU.
x----------------------------------------------------------------------------x
One final note. Respondents appeal from the Decision dated 9 October
2002 of the lower court, made possible by its grant of their petition for relief,
is before the Court of Appeals where it is docketed as CA-G.R. No.
86692.[90] The courts Decision in this case would have obvious consequences
on said appeal; hence, referral of this Decision to the Court of Appeals is in
order.
TINGA, J.:
SECOND DIVISION
DEUTSCHE GESELLSCHAFT FR
G.R. No. 152318
TECHNISCHE ZUSAMMENARBEIT,
also known as GERMAN AGENCY
Present:
FOR TECHNICAL COOPERATION,
(GTZ) HANS PETER PAULENZ and
QUISUMBING, J.,
ANNE NICOLAY,
Chairperson,
Petitioners,
CARPIO MORALES,
TINGA,
VELASCO, and
- versus BRION, JJ.
DECISION
On 7 September 1971, the governments of the Federal Republic of Germany and the
Republic of the Philippines ratified an Agreement concerning Technical Co-operation
(Agreement) in Bonn, capital of what was then West Germany. The Agreement affirmed the
countries common interest in promoting the technical and economic development of their
States, and recogni[zed] the benefits to be derived by both States from closer technical cooperation, and allowed for the conclusion of arrangements concerning individual projects of
technical co-operation.[1] While the Agreement provided for a limited term of effectivity of
five (5) years, it nonetheless was stated that [t]he Agreement shall be tacitly extended for
successive periods of one year unless either of the two Contracting Parties denounces it in
writing three months prior to its expiry, and that even upon the Agreements expiry, its
provisions would continue to apply to any projects agreed upon x x x until their
completion.[2]
On 10 December 1999, the Philippine government, through then Foreign Affairs
Secretary Domingo Siazon, and the German government, agreed to an Arrangement in
furtherance of the 1971 Agreement. This Arrangement affirmed the common commitment of
both governments to promote jointly a project called, Social Health InsuranceNetworking
and Empowerment (SHINE), which was designed to enable Philippine familiesespecially
poor onesto maintain their health and secure health care of sustainable quality. [3] It appears
that SHINE had already been in existence even prior to the effectivity of the Arrangement,
though the record does not indicate when exactly SHINE was constituted. Nonetheless, the
Arrangement stated the various obligations of the Filipino and German governments. The
relevant provisions of the Arrangement are reproduced as follows:
3.
The Government of the Federal Republic of Germany shall
make the following contributions to the project.
It shall
(a)
-
second
Promulgated:
HON. COURT OF APPEALS, HON.
ARIEL CADIENTE SANTOS, Labor
Arbiter of the Arbitration Branch,
National Labor Relations Commission,
and BERNADETTE CARMELLA
provide in situ
xxx
4.
The Government of the Republic of the Philippines shall
make the following contributions to the project:
It shall
(b)
assume an increasing proportion of the running and operating
costs of the project;
(c)
afford the seconded experts any assistance they may require in
carrying out the tasks assigned to them and place at their disposal all
necessary records and documents;
(d)
guarantee that
the project is provided with an itemized budget of its own in order
to ensure smooth continuation of the project.
the necessary legal and administrative framework is created for the
project,
meet
(a)
provide the necessary Philippine experts for the project, in
particular one project coordinator in the Philippine Health Insurance
Corporation (Philhealth), at least three further experts and a sufficient
number of administrative and auxiliary personnel, as well as health
personnel in the pilot provinces and in the other project partners, in
particular one responsible expert for each pilot province and for each
association representing the various target groups,
their part, the German government charge[d] the Deustche Gesellschaft fr Technische
Zusammenarbeit[[5]] (GTZ[[6]]) GmbH, Eschborn, with the implementation of its
contributions.[7]
Private respondents were engaged as contract employees hired by GTZ to work for
SHINE on various dates between December of 1998 to September of 1999. Bernadette
Carmela Magtaas was hired as an information systems manager and project officer of
SHINE;[8] Carolina Dionco as a Project Assistant of SHINE; [9] Christopher Ramos as a
project assistant and liason personnel of NHI related SHINE activities by GTZ; [10] Melvin
Dela Paz and Randy Tamayo as programmers;[11] and Edgardo Ramilo as driver, messenger
and multipurpose service man.[12] The employment contracts of all six private respondents all
specified Dr. Rainer Tollkotter, identified as an adviser of GTZ, as the employer. At the
same time, all the contracts commonly provided that [i]t is mutually agreed and understood
that [Dr. Tollkotter, as employer] is a seconded GTZ expert who is hiring the Employee on
behalf of GTZ and for a Philippine-German bilateral project named Social Health
InsuranceNetworking and Empowerment (SHINE) which will end at a given time. [13]
In September of 1999, Anne Nicolay (Nicolay), a Belgian national, assumed the post of
SHINE Project Manager. Disagreements eventually arose between Nicolay and private
respondents in matters such as proposed salary adjustments, and the course Nicolay was taking
in the implementation of SHINE different from her predecessors. The dispute culminated in a
letter[14] dated 8 June 2000, signed by the private respondents, addressed to Nicolay, and
copies furnished officials of the DOH, Philheath, and the director of the Manila office of GTZ.
The letter raised several issues which private respondents claim had been brought up several
times in the past, but have not been given appropriate response. It was claimed that SHINE
under Nicolay had veered away from its original purpose to facilitate the development of
social health insurance by shoring up the national health insurance program and strengthening
local initiatives, as Nicolay had refused to support local partners and new initiatives on the
premise that community and local government unit schemes were not sustainablea
philosophy that supposedly betrayed Nicolays lack of understanding of the purpose of the
project. Private respondents further alleged that as a result of Nicolays new thrust, resources
have been used inappropriately; that the new management style was not congruent with the
original goals of the project; that Nicolay herself suffered from cultural insensitivity that
consequently failed to sustain healthy relations with SHINEs partners and staff.
The letter ended with these ominous words:
The issues that we [the private respondents] have stated here are
very crucial to us in working for the project. We could no longer find any
reason to stay with the project unless ALL of these issues be addressed
immediately and appropriately. [15]
In response, Nicolay wrote each of the private respondents a letter dated 21 June 2000,
all similarly worded except for their respective addressees. She informed private respondents
that the projects orientations and evolution were decided in consensus with partner
institutions, Philhealth and the DOH, and thus no longer subject to modifications. More
pertinently, she stated:
You have firmly and unequivocally stated in the last paragraph of
your 8th June 2000 letter that you and the five other staff could no longer
find any reason to stay with the project unless ALL of these issues be
addressed immediately and appropriately. Under the foregoing premises
far as to request that the Court re-examine Air Services, a suggestion that is needlessly
improvident under the circumstances. Air Services affirms doctrines grounded in sound
procedural rules that have allowed for the considered and orderly disposition of labor cases.
The OSG points out, citing Heirs of Mayor Nemencio Galvez v. Court of Appeals,[31] that
even when appeal is available, the Court has nonetheless allowed a writ of certiorari when the
orders of the lower court were issued either in excess of or without jurisdiction. Indeed, the
Court has ruled before that the failure to employ available intermediate recourses, such as a
motion for reconsideration, is not a fatal infirmity if the ruling assailed is a patent nullity. This
approach suggested by the OSG allows the Court to inquire directly into what is the main
issuewhether GTZ enjoys immunity from suit.
The arguments raised by GTZ and the OSG are rooted in several indisputable facts.
The SHINE project was implemented pursuant to the bilateral agreements between the
Philippine and German governments. GTZ was tasked, under the 1991 agreement, with the
implementation of the contributions of the German government. The activities performed by
GTZ pertaining to the SHINE project are governmental in nature, related as they are to the
promotion of health insurance in the Philippines. The fact that GTZ entered into employment
contracts with the private respondents did not disqualify it from invoking immunity from suit,
as held in cases such as Holy See v. Rosario, Jr.,[32]which set forth what remains valid
doctrine:
Certainly, the mere entering into a contract by a foreign state with
a private party cannot be the ultimate test. Such an act can only be the start
of the inquiry. The logical question is whether the foreign state is engaged
in the activity in the regular course of business. If the foreign state is not
engaged regularly in a business or trade, the particular act or transaction
must then be tested by its nature. If the act is in pursuit of a sovereign
activity, or an incident thereof, then it is an act jure imperii, especially
when it is not undertaken for gain or profit. [33]
Beyond dispute is the tenability of the comment points raised by GTZ and the OSG
that GTZ was not performing proprietary functions notwithstanding its entry into the particular
employment contracts. Yet there is an equally fundamental premise which GTZ and the OSG
fail to address, namely: Is GTZ, by conception, able to enjoy the FederalRepublics immunity
from suit?
The principle of state immunity from suit, whether a local state or a foreign state, is
reflected in Section 9, Article XVI of the Constitution, which states that the State may not be
sued without its consent. Who or what consists of the State? For one, the doctrine is
available to foreign States insofar as they are sought to be sued in the courts of the local
State,[34] necessary as it is to avoid unduly vexing the peace of nations.
If the instant suit had been brought directly against the Federal Republic of Germany,
there would be no doubt that it is a suit brought against a State, and the only necessary inquiry
is whether said State had consented to be sued. However, the present suit was brought against
GTZ. It is necessary for us to understand what precisely are the parameters of the legal
personality of GTZ.
Counsel for GTZ characterizes GTZ as the implementing agency of the Government
of the Federal Republic of Germany, a depiction similarly adopted by the OSG. Assuming
that characterization is correct, it does not automatically invest GTZ with the ability to invoke
State immunity from suit. The distinction lies in whether the agency is incorporated or
unincorporated. The following lucid discussion from Justice Isagani Cruz is pertinent:
SSS, although it does not thereby concede its liability. That statutory law
has given to the private citizen a remedy for the enforcement and protection
of his rights. The SSS thereby has been required to submit to the
jurisdiction of the Courts, subject to its right to interpose any lawful
defense. Whether the SSS performs governmental or proprietary functions
thus becomes unnecessary to belabor. For by that waiver, a private citizen
may bring a suit against it for varied objectives, such as, in this case, to
obtain compensation in damages arising from contract, and even for tort.
A recent case squarely in point anent the principle, involving the
National Power Corporation, is that of Rayo v. Court of First Instance of
Bulacan, 110 SCRA 457 (1981), wherein this Court, speaking through Mr.
Justice Vicente Abad Santos, ruled:
"It is not necessary to write an extended dissertation on whether
or not the NPC performs a governmental function with respect
to the management and operation of the Angat Dam. It is
sufficient to say that the government has organized a private
corporation, put money in it and has allowed it to sue and be
sued in any court under its charter. (R.A. No. 6395, Sec. 3[d]).
As a government, owned and controlled corporation, it has a
personality of its own, distinct and separate from that of the
Government. Moreover, the charter provision that the NPC can
'sue and be sued in any court' is without qualification on the
cause of action and accordingly it can include a tort claim such
as the one instituted by the petitioners."[41]
It is useful to note that on the part of the Philippine government, it had designated two
entities, the Department of Health and the Philippine Health Insurance Corporation (PHIC), as
the implementing agencies in behalf of the Philippines. The PHIC was established under
Republic Act No. 7875, Section 16(g) of which grants the corporation the power to sue and be
sued in court. Applying the previously cited jurisprudence, PHIC would not enjoy immunity
from suit even in the performance of its functions connected with SHINE, however,
governmental in nature as they may be.
Is GTZ an incorporated agency of the German government? There is some mystery
surrounding that question. Neither GTZ nor the OSG go beyond the claim that petitioner is
the implementing agency of the Government of the Federal Republic of Germany. On the
other hand, private respondents asserted before the Labor Arbiter that GTZ was a private
corporation engaged in the implementation of development projects. [42] The Labor Arbiter
accepted that claim in his Order denying the Motion to Dismiss, [43] though he was silent on that
point in his Decision. Nevertheless, private respondents argue in their Comment that the
finding that GTZ was a private corporation was never controverted, and is therefore deemed
admitted.[44] In its Reply, GTZ controverts that finding, saying that it is a matter of public
knowledge that the status of petitioner GTZ is that of the implementing agency, and not that
of a private corporation. [45]
In truth, private respondents were unable to adduce any evidence to substantiate their
claim that GTZ was a private corporation, and the Labor Arbiter acted rashly in accepting
such claim without explanation. But neither has GTZ supplied any evidence defining its legal
nature beyond that of the bare descriptive implementing agency. There is no doubt that the
1991 Agreement designated GTZ as the implementing agency in behalf of the German
government. Yet the catch is that such term has no precise definition that is responsive to our
concerns. Inherently, an agent acts in behalf of a principal, and the GTZ can be said to act in
behalf of the German state. But that is as far as implementing agency could take us. The term
by itself does not supply whether GTZ is incorporated or unincorporated, whether it is owned
by the German state or by private interests, whether it has juridical personality independent of
the German government or none at all.
GTZ itself provides a more helpful clue, inadvertently, through its own official Internet
website.[46] In the Corporate Profile section of the English language version of its site, GTZ
describes itself as follows:
As an international cooperation enterprise for sustainable
development with worldwide operations, the federally owned Deutsche
Gesellschaft fr Technische Zusammenarbeit (GTZ) GmbH supports the
German Government in achieving its development-policy objectives. It
provides viable, forward-looking solutions for political, economic,
ecological and social development in a globalised world. Working under
difficult conditions, GTZ promotes complex reforms and change processes.
Its corporate objective is to improve peoples living conditions on a
sustainable basis.
GTZ is a federal enterprise based in Eschborn near Frankfurt am
Main. It was founded in 1975 as a company under private law. The German
Federal Ministry for Economic Cooperation and Development (BMZ) is its
major client. The company also operates on behalf of other German
ministries, the governments of other countries and international clients,
such as the European Commission, the United Nations and the World Bank,
as well as on behalf of private enterprises. GTZ works on a public-benefit
basis. All surpluses generated are channeled [sic] back into its own
international cooperation projects for sustainable development.[47]
GTZs own website elicits that petitioner is federally owned, a federal enterprise,
and founded in 1975 as a company under private law. GTZ clearly has a very meaningful
relationship with the Federal Republic of Germany, which apparently owns it. At the same
time, it appears that GTZ was actually organized not through a legislative public charter, but
under private law, in the same way that Philippine corporations can be organized under the
Corporation Code even if fully owned by the Philippine government.
This self-description of GTZ in its own official website gives further cause for pause in
adopting petitioners argument that GTZ is entitled to immunity from suit because it is an
implementing agency. The above-quoted statement does not dispute the characterization of
GTZ as an implementing agency of the Federal Republic of Germany, yet it bolsters the
notion that as a company organized under private law, it has a legal personality independent of
that of the Federal Republic of Germany.
The Federal Republic of Germany, in its own official website, [48] also makes reference to
GTZ and describes it in this manner:
x x x Going by the principle of sustainable development, the
German Technical Cooperation (Deutsche Gesellschaft fr Technische
Zusammenarbeit GmbH, GTZ) takes on non-profit projects in international
by dismissing the complaint against it. Our finding has additional ramifications on the failure
of GTZ to properly appeal the Labor Arbiters decision to the NLRC. As pointed out by the
OSG, the direct recourse to the Court of Appeals while bypassing the NLRC could have been
sanctioned had the Labor Arbiters decision been a patent nullity. Since the Labor Arbiter
acted properly in deciding the complaint, notwithstanding GTZs claim of immunity, we
cannot see how the decision could have translated into a patent nullity.
As a result, there was no basis for petitioners in foregoing the appeal to the NLRC by
filing directly with the Court of Appeals the petition for certiorari. It then follows that the
Court of Appeals acted correctly in dismissing the petition on that ground. As a further
consequence, since petitioners failed to perfect an appeal from the Labor Arbiters Decision,
the same has long become final and executory. All other questions related to this case, such as
whether or not private respondents were illegally dismissed, are no longer susceptible to
review, respecting as we do the finality of the Labor Arbiters Decision.
A final note. This decision should not be seen as deviation from the more common
methodology employed in ascertaining whether a party enjoys State immunity from suit, one
which focuses on the particular functions exercised by the party and determines whether these
are proprietary or sovereign in nature. The nature of the acts performed by the entity invoking
immunity remains the most important barometer for testing whether the privilege of State
immunity from suit should apply. At the same time, our Constitution stipulates that a State
immunity from suit is conditional on its withholding of consent; hence, the laws and
circumstances pertaining to the creation and legal personality of an instrumentality or agency
invoking immunity remain relevant. Consent to be sued, as exhibited in this decision, is often
conferred by the very same statute or general law creating the instrumentality or agency.
WHEREFORE, the petition is DENIED. No pronouncement as to costs.
SO ORDERED.
a privilege speech of Senator Juan Ponce Enrile urging the Senate to investigate the
alleged overpricing and other unlawful provisions of the contract covering the North
Rail Project.
The Senate Committee on National Defense and Security likewise issued
2
invitations dated September 22, 2005 to the following officials of the AFP: the
Commanding General of the Philippine Army, Lt. Gen. Hermogenes C. Esperon;
Inspector General of the AFP Vice Admiral Mateo M. Mayuga; Deputy Chief of Staff
for Intelligence of the AFP Rear Admiral Tirso R. Danga; Chief of the Intelligence
Service of the AFP Brig. Gen. Marlu Q. Quevedo; Assistant Superintendent of the
Philippine Military Academy (PMA) Brig. Gen. Francisco V. Gudani; and Assistant
Commandant, Corps of Cadets of the PMA, Col. Alexander F. Balutan, for them to
attend as resource persons in a public hearing scheduled on September 28, 2005 on
the following: (1) Privilege Speech of Senator Aquilino Q. Pimentel Jr., delivered on
June 6, 2005 entitled "Bunye has Provided Smoking Gun or has Opened a Can of
Worms that Show Massive Electoral Fraud in the Presidential Election of May 2005";
(2) Privilege Speech of Senator Jinggoy E. Estrada delivered on July 26, 2005 entitled
"The Philippines as the Wire-Tapping Capital of the World"; (3) Privilege Speech of
Senator Rodolfo Biazon delivered on August 1, 2005 entitled "Clear and Present
Danger"; (4) Senate Resolution No. 285 filed by Senator Maria Ana Consuelo
Madrigal Resolution Directing the Committee on National Defense and Security to
Conduct an Inquiry, in Aid of Legislation, and in the National Interest, on the Role of
the Military in the So-called "Gloriagate Scandal"; and (5) Senate Resolution No. 295
filed by Senator Biazon Resolution Directing the Committee on National Defense
and Security to Conduct an Inquiry, in Aid of Legislation, on the Wire-Tapping of the
President of the Philippines.
Also invited to the above-said hearing scheduled on September 28 2005 was the AFP
Chief of Staff, General Generoso S. Senga who, by letter 3 dated September 27, 2005,
requested for its postponement "due to a pressing operational situation that demands
[his utmost personal attention" while "some of the invited AFP officers are currently
attending to other urgent operational matters."
On September 28, 2005, Senate President Franklin M. Drilon received from Executive
4
Secretary Eduardo R. Ermita a letter dated September 27, 2005 "respectfully
request[ing] for the postponement of the hearing [regarding the NorthRail project] to
which various officials of the Executive Department have been invited" in order to
"afford said officials ample time and opportunity to study and prepare for the various
issues so that they may better enlighten the Senate Committee on its investigation."
Senate President Drilon, however, wrote5 Executive Secretary Ermita that the
Senators "are unable to accede to [his request]" as it "was sent belatedly" and "[a]ll
preparations and arrangements as well as notices to all resource persons were
completed [the previous] week."
6
Senate President Drilon likewise received on September 28, 2005 a letter from the
President of the North Luzon Railways Corporation Jose L. Cortes, Jr. requesting that
the hearing on the NorthRail project be postponed or cancelled until a copy of the
report of the UP Law Center on the contract agreements relative to the project had
been secured.
On September 28, 2005, the President issued E.O. 464, "Ensuring Observance of the
Principle of Separation of Powers, Adherence to the Rule on Executive Privilege and
Respect for the Rights of Public Officials Appearing in Legislative Inquiries in Aid of
7
Legislation Under the Constitution, and For Other Purposes," which, pursuant to
Section 6 thereof, took effect immediately. The salient provisions of the Order are as
follows:
SECTION 1. Appearance by Heads of Departments Before Congress. In
accordance with Article VI, Section 22 of the Constitution and to implement the
Constitutional provisions on the separation of powers between co-equal branches of
the government, all heads of departments of the Executive Branch of the government
shall secure the consent of the President prior to appearing before either House of
Congress.
When the security of the State or the public interest so requires and the President so
states in writing, the appearance shall only be conducted in executive session.
SECTION. 2. Nature, Scope and Coverage of Executive Privilege.
(a) Nature and Scope. - The rule of confidentiality based on executive privilege is
fundamental to the operation of government and rooted in the separation of powers
under the Constitution (Almonte vs. Vasquez, G.R. No. 95367, 23 May 1995). Further,
Republic Act No. 6713 or the Code of Conduct and Ethical Standards for Public
Officials and Employees provides that Public Officials and Employees shall not use or
divulge confidential or classified information officially known to them by reason of their
office and not made available to the public to prejudice the public interest.
Executive privilege covers all confidential or classified information between the
President and the public officers covered by this executive order, including:
Conversations and correspondence between the President and the public official
covered by this executive order (Almonte vs. Vasquez G.R. No. 95367, 23 May 1995;
Chavez v. Public Estates Authority, G.R. No. 133250, 9 July 2002);
Military, diplomatic and other national security matters which in the interest of national
security should not be divulged (Almonte vs. Vasquez, G.R. No. 95367, 23 May 1995;
Chavez v. Presidential Commission on Good Government, G.R. No. 130716, 9
December 1998).
Information between inter-government agencies prior to the conclusion of treaties and
executive agreements (Chavez v. Presidential Commission on Good Government,
G.R. No. 130716, 9 December 1998);
Discussion in close-door Cabinet meetings (Chavez v. Presidential Commission on
Good Government, G.R. No. 130716, 9 December 1998);
Matters affecting national security and public order (Chavez v. Public Estates
Authority, G.R. No. 133250, 9 July 2002).
(b) Who are covered. The following are covered by this executive order:
Senior officials of executive departments who in the judgment of the department
heads are covered by the executive privilege;
Generals and flag officers of the Armed Forces of the Philippines and such other
officers who in the judgment of the Chief of Staff are covered by the executive
privilege;
Philippine National Police (PNP) officers with rank of chief superintendent or higher
and such other officers who in the judgment of the Chief of the PNP are covered by
the executive privilege;
Senior national security officials who in the judgment of the National Security Adviser
are covered by the executive privilege; and
Such other officers as may be determined by the President.
SECTION 3. Appearance of Other Public Officials Before Congress. All public
officials enumerated in Section 2 (b) hereof shall secure prior consent of the President
prior to appearing before either House of Congress to ensure the observance of the
principle of separation of powers, adherence to the rule on executive privilege and
respect for the rights of public officials appearing in inquiries in aid of legislation.
(Emphasis and underscoring supplied)
Also on September 28, 2005, Senate President Drilon received from Executive
Secretary Ermita a copy of E.O. 464, and another letter 8 informing him "that officials
of the Executive Department invited to appear at the meeting [regarding the NorthRail
project] will not be able to attend the same without the consent of the President,
pursuant to [E.O. 464]" and that "said officials have not secured the required consent
from the President." On even date which was also the scheduled date of the hearing
on the alleged wiretapping, Gen. Senga sent a letter 9 to Senator Biazon, Chairperson
of the Committee on National Defense and Security, informing him "that per
instruction of [President Arroyo], thru the Secretary of National Defense, no officer of
the [AFP] is authorized to appear before any Senate or Congressional hearings
without seeking a written approval from the President" and "that no approval has been
granted by the President to any AFP officer to appear before the public hearing of the
Senate Committee on National Defense and Security scheduled [on] 28 September
2005."
Despite the communications received from Executive Secretary Ermita and Gen.
Senga, the investigation scheduled by the Committee on National Defense and
Security pushed through, with only Col. Balutan and Brig. Gen. Gudani among all the
AFP officials invited attending.
For defying President Arroyos order barring military personnel from testifying before
legislative inquiries without her approval, Brig. Gen. Gudani and Col. Balutan were
relieved from their military posts and were made to face court martial proceedings.
their petition for certiorari and prohibition, docketed as G.R. No. 171246, and pray that
E.O. 464 be declared null and void.
On October 11, 2005, Petitioner Senate of the Philippines, alleging that it has a vital
interest in the resolution of the issue of the validity of E.O. 464 for it stands to suffer
imminent and material injury, as it has already sustained the same with its continued
enforcement since it directly interferes with and impedes the valid exercise of the
Senates powers and functions and conceals information of great public interest and
concern, filed its petition for certiorari and prohibition, docketed as G.R. No. 169777
and prays that E.O. 464 be declared unconstitutional.
All the petitions pray for the issuance of a Temporary Restraining Order enjoining
respondents from implementing, enforcing, and observing E.O. 464.
On October 14, 2005, PDP-Laban, a registered political party with members duly
elected into the Philippine Senate and House of Representatives, filed a similar
petition for certiorari and prohibition, docketed as G.R. No. 169834, alleging that it is
affected by the challenged E.O. 464 because it hampers its legislative agenda to be
implemented through its members in Congress, particularly in the conduct of inquiries
in aid of legislation and transcendental issues need to be resolved to avert a
constitutional crisis between the executive and legislative branches of the
government.
Meanwhile, by letter14 dated February 6, 2006, Senator Biazon reiterated his invitation
to Gen. Senga for him and other military officers to attend the hearing on the alleged
wiretapping scheduled on February 10, 2005. Gen. Senga replied, however, by
letter15 dated February 8, 2006, that "[p]ursuant to Executive Order No. 464, th[e]
Headquarters requested for a clearance from the President to allow [them] to appear
before the public hearing" and that "they will attend once [their] request is approved
by the President." As none of those invited appeared, the hearing on February 10,
2006 was cancelled.16
In another investigation conducted jointly by the Senate Committee on Agriculture and
Food and the Blue Ribbon Committee on the alleged mismanagement and use of the
fertilizer fund under the Ginintuang Masaganang Ani program of the Department of
Agriculture (DA), several Cabinet officials were invited to the hearings scheduled on
October 5 and 26, November 24 and December 12, 2005 but most of them failed to
attend, DA Undersecretary Belinda Gonzales, DA Assistant Secretary Felix Jose
Montes, Fertilizer and Pesticide Authority Executive Director Norlito R. Gicana, 17 and
those from the Department of Budget and Management18 having invoked E.O. 464.
In the oral arguments on the petitions conducted on February 21, 2006, the following
substantive issues were ventilated: (1) whether respondents committed grave abuse
of discretion in implementing E.O. 464 prior to its publication in the Official Gazette or
in a newspaper of general circulation; and (2) whether E.O. 464 violates the following
provisions of the Constitution: Art. II, Sec. 28, Art. III, Sec. 4, Art. III, Sec. 7, Art. IV.
Sec. 1, Art. VI, Sec. 21, Art. VI, Sec. 22, Art. XI, Sec. 1, and Art. XIII, Sec. 16. The
procedural issue of whether there is an actual case or controversy that calls for
judicial review was not taken up; instead, the parties were instructed to discuss it in
their respective memoranda.
After the conclusion of the oral arguments, the parties were directed to submit their
respective memoranda, paying particular attention to the following propositions: (1)
that E.O. 464 is, on its face, unconstitutional; and (2) assuming that it is not, it is
unconstitutional as applied in four instances, namely: (a) the so called Fertilizer scam;
(b) the NorthRail investigation (c) the Wiretapping activity of the ISAFP; and (d) the
investigation on the Venable contract. 22
Petitioners in G.R. No. 16966023 and G.R. No. 16977724 filed their memoranda on
March 7, 2006, while those in G.R. No. 16966725 and G.R. No. 16983426 filed theirs
the next day or on March 8, 2006. Petitioners in G.R. No. 171246 did not file any
memorandum.
Petitioners Bayan Muna et al. in G.R. No. 169659, after their motion for extension to
file memorandum27 was granted, subsequently filed a manifestation28 dated March
14, 2006 that it would no longer file its memorandum in the interest of having the
issues resolved soonest, prompting this Court to issue a Resolution reprimanding
29
them.
Petitioners submit that E.O. 464 violates the following constitutional provisions:
Art. VI, Sec. 2130
In the budget hearings set by the Senate on February 8 and 13, 2006, Press
19
Secretary and Presidential Spokesperson Ignacio R. Bunye, DOJ Secretary Raul M.
20
Gonzalez and Department of Interior and Local Government Undersecretary Marius
P. Corpus21 communicated their inability to attend due to lack of appropriate
clearance from the President pursuant to E.O. 464. During the February 13, 2005
budget hearing, however, Secretary Bunye was allowed to attend by Executive
Secretary Ermita.
On February 13, 2006, Jose Anselmo I. Cadiz and the incumbent members of the
Board of Governors of the Integrated Bar of the Philippines, as taxpayers, and the
Integrated Bar of the Philippines as the official organization of all Philippine lawyers,
all invoking their constitutional right to be informed on matters of public interest, filed
31
33
34
35
36
Representatives which had been effectively impaired by E.O. 464, there being no
mention of any investigation called by the House of Representatives or any of its
committees which was aborted due to the implementation of E.O. 464.
As for Bayan Munas alleged interest as a party-list representing the marginalized and
underrepresented, and that of the other petitioner groups and individuals who profess
to have standing as advocates and defenders of the Constitution, respondents
contend that such interest falls short of that required to confer standing on them as
parties "injured-in-fact."40
Respecting petitioner Chavez, respondents contend that Chavez may not claim an
interest as a taxpayer for the implementation of E.O. 464 does not involve the
exercise of taxing or spending power.41
With regard to the petition filed by the Senate, respondents argue that in the absence
of a personal or direct injury by reason of the issuance of E.O. 464, the Senate and its
individual members are not the proper parties to assail the constitutionality of E.O.
464.
Invoking this Courts ruling in National Economic Protectionism Association v.
Ongpin42 and Valmonte v. Philippine Charity Sweepstakes Office, 43 respondents
assert that to be considered a proper party, one must have a personal and substantial
interest in the case, such that he has sustained or will sustain direct injury due to the
enforcement of E.O. 464.44
That the Senate of the Philippines has a fundamental right essential not only for
intelligent public decision-making in a democratic system, but more especially for
45
sound legislation is not disputed. E.O. 464, however, allegedly stifles the ability of
46
the members of Congress to access information that is crucial to law-making. Verily,
the Senate, including its individual members, has a substantial and direct interest over
the outcome of the controversy and is the proper party to assail the constitutionality of
E.O. 464. Indeed, legislators have standing to maintain inviolate the prerogative,
powers and privileges vested by the Constitution in their office and are allowed to sue
to question the validity of any official action which they claim infringes their
prerogatives as legislators.47
In the same vein, party-list representatives Satur Ocampo (Bayan Muna), Teodoro
Casino (Bayan Muna), Joel Virador (Bayan Muna), Crispin Beltran (Anakpawis),
Rafael Mariano (Anakpawis), and Liza Maza (Gabriela) are allowed to sue to question
the constitutionality of E.O. 464, the absence of any claim that an investigation called
by the House of Representatives or any of its committees was aborted due to the
implementation of E.O. 464 notwithstanding, it being sufficient that a claim is made
that E.O. 464 infringes on their constitutional rights and duties as members of
Congress to conduct investigation in aid of legislation and conduct oversight functions
in the implementation of laws.
The national political party, Bayan Muna, likewise meets the standing requirement as
it obtained three seats in the House of Representatives in the 2004 elections and is,
therefore, entitled to participate in the legislative process consonant with the declared
policy underlying the party list system of affording citizens belonging to marginalized
and underrepresented sectors, organizations and parties who lack well-defined
political constituencies to contribute to the formulation and enactment of legislation
48
that will benefit the nation.
As Bayan Muna and Representatives Ocampo et al. have the standing to file their
petitions, passing on the standing of their co-petitioners Courage and Codal is
rendered unnecessary.49
In filing their respective petitions, Chavez, the ALG which claims to be an organization
of citizens, and the incumbent members of the IBP Board of Governors and the IBP in
behalf of its lawyer members, 50 invoke their constitutional right to information on
matters of public concern, asserting that the right to information, curtailed and violated
by E.O. 464, is essential to the effective exercise of other constitutional rights 51 and to
the maintenance of the balance of power among the three branches of the
52
government through the principle of checks and balances.
It is well-settled that when suing as a citizen, the interest of the petitioner in assailing
the constitutionality of laws, presidential decrees, orders, and other regulations, must
be direct and personal. In Franciso v. House of Representatives, 53 this Court held that
when the proceeding involves the assertion of a public right, the mere fact that he is a
citizen satisfies the requirement of personal interest.
As for petitioner PDP-Laban, it asseverates that it is clothed with legal standing in
view of the transcendental issues raised in its petition which this Court needs to
resolve in order to avert a constitutional crisis. For it to be accorded standing on the
ground of transcendental importance, however, it must establish (1) the character of
the funds (that it is public) or other assets involved in the case, (2) the presence of a
clear case of disregard of a constitutional or statutory prohibition by the public
respondent agency or instrumentality of the government, and (3) the lack of any party
with a more direct and specific interest in raising the questions being raised. 54 The
first and last determinants not being present as no public funds or assets are involved
and petitioners in G.R. Nos. 169777 and 169659 have direct and specific interests in
the resolution of the controversy, petitioner PDP-Laban is bereft of standing to file its
petition. Its allegation that E.O. 464 hampers its legislative agenda is vague and
uncertain, and at best is only a "generalized interest" which it shares with the rest of
the political parties. Concrete injury, whether actual or threatened, is that
indispensable element of a dispute which serves in part to cast it in a form traditionally
55
capable of judicial resolution. In fine, PDP-Labans alleged interest as a political
party does not suffice to clothe it with legal standing.
Actual Case or Controversy
Petitioners assert that an actual case exists, they citing the absence of the executive
officials invited by the Senate to its hearings after the issuance of E.O. 464,
particularly those on the NorthRail project and the wiretapping controversy.
Respondents counter that there is no case or controversy, there being no showing
that President Arroyo has actually withheld her consent or prohibited the appearance
56
of the invited officials. These officials, they claim, merely communicated to the
Senate that they have not yet secured the consent of the President, not that the
President prohibited their attendance. 57 Specifically with regard to the AFP officers
who did not attend the hearing on September 28, 2005, respondents claim that the
instruction not to attend without the Presidents consent was based on its role as
Commander-in-Chief of the Armed Forces, not on E.O. 464.
Respondents thus conclude that the petitions merely rest on an unfounded
apprehension that the President will abuse its power of preventing the appearance of
officials before Congress, and that such apprehension is not sufficient for challenging
the validity of E.O. 464.
The Court finds respondents assertion that the President has not withheld her
consent or prohibited the appearance of the officials concerned immaterial in
determining the existence of an actual case or controversy insofar as E.O. 464 is
concerned. For E.O. 464 does not require either a deliberate withholding of consent
or an express prohibition issuing from the President in order to bar officials from
appearing before Congress.
As the implementation of the challenged order has already resulted in the absence of
officials invited to the hearings of petitioner Senate of the Philippines, it would make
no sense to wait for any further event before considering the present case ripe for
adjudication. Indeed, it would be sheer abandonment of duty if this Court would now
refrain from passing on the constitutionality of E.O. 464.
Constitutionality of E.O. 464
E.O. 464, to the extent that it bars the appearance of executive officials before
Congress, deprives Congress of the information in the possession of these officials.
To resolve the question of whether such withholding of information violates the
Constitution, consideration of the general power of Congress to obtain information,
otherwise known as the power of inquiry, is in order.
The power of inquiry
The Congress power of inquiry is expressly recognized in Section 21 of Article VI of
the Constitution which reads:
SECTION 21. The Senate or the House of Representatives or any of its respective
committees may conduct inquiries in aid of legislation in accordance with its duly
published rules of procedure. The rights of persons appearing in or affected by such
inquiries shall be respected. (Underscoring supplied)
This provision is worded exactly as Section 8 of Article VIII of the 1973 Constitution
except that, in the latter, it vests the power of inquiry in the unicameral legislature
established therein the Batasang Pambansa and its committees.
The 1935 Constitution did not contain a similar provision. Nonetheless, in Arnault v.
Nazareno,58 a case decided in 1950 under that Constitution, the Court already
recognized that the power of inquiry is inherent in the power to legislate.
Arnault involved a Senate investigation of the reportedly anomalous purchase of the
Buenavista and Tambobong Estates by the Rural Progress Administration. Arnault,
who was considered a leading witness in the controversy, was called to testify
thereon by the Senate. On account of his refusal to answer the questions of the
senators on an important point, he was, by resolution of the Senate, detained for
contempt. Upholding the Senates power to punish Arnault for contempt, this Court
held:
Although there is no provision in the Constitution expressly investing either House of
Congress with power to make investigations and exact testimony to the end that it
may exercise its legislative functions advisedly and effectively, such power is so far
incidental to the legislative function as to be implied. In other words, the power of
inquiry with process to enforce it is an essential and appropriate auxiliary to the
legislative function. A legislative body cannot legislate wisely or effectively in the
absence of information respecting the conditions which the legislation is intended to
affect or change; and where the legislative body does not itself possess the requisite
information which is not infrequently true recourse must be had to others who do
possess it. Experience has shown that mere requests for such information are often
unavailing, and also that information which is volunteered is not always accurate or
complete; so some means of compulsion is essential to obtain what is needed. 59 . . .
(Emphasis and underscoring supplied)
That this power of inquiry is broad enough to cover officials of the executive branch
may be deduced from the same case. The power of inquiry, the Court therein ruled, is
60
co-extensive with the power to legislate. The matters which may be a proper subject
of legislation and those which may be a proper subject of investigation are one. It
follows that the operation of government, being a legitimate subject for legislation, is a
proper subject for investigation.
Thus, the Court found that the Senate investigation of the government transaction
involved in Arnault was a proper exercise of the power of inquiry. Besides being
related to the expenditure of public funds of which Congress is the guardian, the
transaction, the Court held, "also involved government agencies created by Congress
and officers whose positions it is within the power of Congress to regulate or even
abolish."
Since Congress has authority to inquire into the operations of the executive branch, it
would be incongruous to hold that the power of inquiry does not extend to executive
officials who are the most familiar with and informed on executive operations.
As discussed in Arnault, the power of inquiry, "with process to enforce it," is grounded
on the necessity of information in the legislative process. If the information possessed
by executive officials on the operation of their offices is necessary for wise legislation
on that subject, by parity of reasoning, Congress has the right to that information and
the power to compel the disclosure thereof.
it as "the right of the President and high-level executive branch officers to withhold
information from Congress, the courts, and ultimately the public."65
66
requested information falls within one of the traditional privileges, but also whether
that privilege should be honored in a given procedural setting.71
The leading case on executive privilege in the United States is U.S. v.
Nixon, 72 decided in 1974. In issue in that case was the validity of President Nixons
claim of executive privilege against a subpoena issued by a district court requiring the
production of certain tapes and documents relating to the Watergate investigations.
The claim of privilege was based on the Presidents general interest in the
confidentiality of his conversations and correspondence. The U.S. Court held that
while there is no explicit reference to a privilege of confidentiality in the U.S.
Constitution, it is constitutionally based to the extent that it relates to the effective
discharge of a Presidents powers. The Court, nonetheless, rejected the Presidents
claim of privilege, ruling that the privilege must be balanced against the public interest
in the fair administration of criminal justice. Notably, the Court was careful to clarify
that it was not there addressing the issue of claims of privilege in a civil litigation or
against congressional demands for information.
Cases in the U.S. which involve claims of executive privilege against Congress are
rare.73 Despite frequent assertion of the privilege to deny information to Congress,
beginning with President Washingtons refusal to turn over treaty negotiation records
to the House of Representatives, the U.S. Supreme Court has never adjudicated the
issue.74 However, the U.S. Court of Appeals for the District of Columbia Circuit, in a
case decided earlier in the same year as Nixon, recognized the Presidents privilege
over his conversations against a congressional subpoena. 75 Anticipating the
balancing approach adopted by the U.S. Supreme Court in Nixon, the Court of
Appeals weighed the public interest protected by the claim of privilege against the
interest that would be served by disclosure to the Committee. Ruling that the balance
favored the President, the Court declined to enforce the subpoena. 76
In this jurisdiction, the doctrine of executive privilege was recognized by this Court in
Almonte v. Vasquez.77Almonte used the term in reference to the same privilege
subject of Nixon. It quoted the following portion of the Nixon decision which explains
the basis for the privilege:
"The expectation of a President to the confidentiality of his conversations and
correspondences, like the claim of confidentiality of judicial deliberations, for example,
has all the values to which we accord deference for the privacy of all citizens and,
added to those values, is the necessity for protection of the public interest in candid,
objective, and even blunt or harsh opinions in Presidential decision-making. A
President and those who assist him must be free to explore alternatives in the
process of shaping policies and making decisions and to do so in a way many would
be unwilling to express except privately. These are the considerations justifying a
presumptive privilege for Presidential communications. The privilege is fundamental
to the operation of government and inextricably rooted in the separation of powers
under the Constitution x x x " (Emphasis and underscoring supplied)
Almonte involved a subpoena duces tecum issued by the Ombudsman against the
therein petitioners. It did not involve, as expressly stated in the decision, the right of
78
the people to information. Nonetheless, the Court recognized that there are certain
types of information which the government may withhold from the public, thus
In Chavez v. PCGG, the Court held that this jurisdiction recognizes the common law
holding that there is a "governmental privilege against public disclosure with respect
to state secrets regarding military, diplomatic and other national security
matters."80 The same case held that closed-door Cabinet meetings are also a
recognized limitation on the right to information.
Similarly, in Chavez v. Public Estates Authority,81 the Court ruled that the right to
information does not extend to matters recognized as "privileged information under
the separation of powers,"82 by which the Court meant Presidential conversations,
correspondences, and discussions in closed-door Cabinet meetings. It also held that
information on military and diplomatic secrets and those affecting national security,
and information on investigations of crimes by law enforcement agencies before the
prosecution of the accused were exempted from the right to information.
From the above discussion on the meaning and scope of executive privilege, both in
the United States and in this jurisdiction, a clear principle emerges. Executive
privilege, whether asserted against Congress, the courts, or the public, is recognized
only in relation to certain types of information of a sensitive character. While executive
privilege is a constitutional concept, a claim thereof may be valid or not depending on
the ground invoked to justify it and the context in which it is made. Noticeably absent
is any recognition that executive officials are exempt from the duty to disclose
information by the mere fact of being executive officials. Indeed, the extraordinary
character of the exemptions indicates that the presumption inclines heavily against
executive secrecy and in favor of disclosure.
Validity of Section 1
Section 1 is similar to Section 3 in that both require the officials covered by them to
secure the consent of the President prior to appearing before Congress. There are
significant differences between the two provisions, however, which constrain this
Court to discuss the validity of these provisions separately.
Section 1 specifically applies to department heads. It does not, unlike Section 3,
require a prior determination by any official whether they are covered by E.O. 464.
The President herself has, through the challenged order, made the determination that
they are. Further, unlike also Section 3, the coverage of department heads under
Section 1 is not made to depend on the department heads possession of any
information which might be covered by executive privilege. In fact, in marked contrast
to Section 3 vis--vis Section 2, there is no reference to executive privilege at all.
Rather, the required prior consent under Section 1 is grounded on Article VI, Section
22 of the Constitution on what has been referred to as the question hour.
SECTION 22. The heads of departments may upon their own initiative, with the
consent of the President, or upon the request of either House, as the rules of each
House shall provide, appear before and be heard by such House on any matter
pertaining to their departments. Written questions shall be submitted to the President
of the Senate or the Speaker of the House of Representatives at least three days
before their scheduled appearance. Interpellations shall not be limited to written
questions, but may cover matters related thereto. When the security of the State or
the public interest so requires and the President so states in writing, the appearance
shall be conducted in executive session.
Determining the validity of Section 1 thus requires an examination of the meaning of
Section 22 of Article VI. Section 22 which provides for the question hour must be
interpreted vis--vis Section 21 which provides for the power of either House of
Congress to "conduct inquiries in aid of legislation." As the following excerpt of the
deliberations of the Constitutional Commission shows, the framers were aware that
these two provisions involved distinct functions of Congress.
MR. MAAMBONG. x x x When we amended Section 20 [now Section 22 on the
Question Hour] yesterday, I noticed that members of the Cabinet cannot be
compelled anymore to appear before the House of Representatives or before the
Senate. I have a particular problem in this regard, Madam President, because in our
experience in the Regular Batasang Pambansa as the Gentleman himself has
experienced in the interim Batasang Pambansa one of the most competent inputs
that we can put in our committee deliberations, either in aid of legislation or in
congressional investigations, is the testimonies of Cabinet ministers. We usually invite
them, but if they do not come and it is a congressional investigation, we usually issue
subpoenas.
I want to be clarified on a statement made by Commissioner Suarez when he said
that the fact that the Cabinet ministers may refuse to come to the House of
Representatives or the Senate [when requested under Section 22] does not mean
that they need not come when they are invited or subpoenaed by the committee of
either House when it comes to inquiries in aid of legislation or congressional
investigation. According to Commissioner Suarez, that is allowed and their presence
can be had under Section 21. Does the gentleman confirm this, Madam President?
MR. DAVIDE. We confirm that, Madam President, because Section 20 refers only to
what was originally the Question Hour, whereas, Section 21 would refer specifically to
inquiries in aid of legislation, under which anybody for that matter, may be summoned
and if he refuses, he can be held in contempt of the House. 83 (Emphasis and
underscoring supplied)
A distinction was thus made between inquiries in aid of legislation and the question
hour. While attendance was meant to be discretionary in the question hour, it was
compulsory in inquiries in aid of legislation. The reference to Commissioner Suarez
bears noting, he being one of the proponents of the amendment to make the
appearance of department heads discretionary in the question hour.
So clearly was this distinction conveyed to the members of the Commission that the
Committee on Style, precisely in recognition of this distinction, later moved the
provision on question hour from its original position as Section 20 in the original draft
down to Section 31, far from the provision on inquiries in aid of legislation. This gave
rise to the following exchange during the deliberations:
(Mr.
Jamir).
Commissioner
Davide
is
MR. DAVIDE. Thank you, Mr. Presiding Officer. I have only one reaction to the
Question Hour. I propose that instead of putting it as Section 31, it should follow
Legislative Inquiries.
THE PRESIDING OFFICER. What does the committee say?
MR. GUINGONA. I ask Commissioner Maambong to reply, Mr. Presiding Officer.
MR. MAAMBONG. Actually, we considered that previously when we sequenced this
but we reasoned that in Section 21, which is Legislative Inquiry, it is actually a power
of Congress in terms of its own lawmaking; whereas, a Question Hour is not actually
a power in terms of its own lawmaking power because in Legislative Inquiry, it is in aid
of legislation. And so we put Question Hour as Section 31. I hope Commissioner
Davide will consider this.
MR. DAVIDE. The Question Hour is closely related with the legislative power, and it is
precisely as a complement to or a supplement of the Legislative Inquiry. The
appearance of the members of Cabinet would be very, very essential not only in the
application of check and balance but also, in effect, in aid of legislation.
MR. MAAMBONG. After conferring with the committee, we find merit in the
suggestion of Commissioner Davide. In other words, we are accepting that and so
this Section 31 would now become Section 22. Would it be, Commissioner Davide?
84
which is to elicit information that may be used for legislation, while the other pertains
to the power to conduct a question hour, the objective of which is to obtain information
in pursuit of Congress oversight function.
When Congress merely seeks to be informed on how department heads are
implementing the statutes which it has issued, its right to such information is not as
imperative as that of the President to whom, as Chief Executive, such department
heads must give a report of their performance as a matter of duty. In such instances,
Section 22, in keeping with the separation of powers, states that Congress may only
request their appearance. Nonetheless, when the inquiry in which Congress requires
their appearance is "in aid of legislation" under Section 21, the appearance is
mandatory for the same reasons stated in Arnault.90
In fine, the oversight function of Congress may be facilitated by compulsory process
only to the extent that it is performed in pursuit of legislation. This is consistent with
the intent discerned from the deliberations of the Constitutional Commission.
Ultimately, the power of Congress to compel the appearance of executive officials
under Section 21 and the lack of it under Section 22 find their basis in the principle of
separation of powers. While the executive branch is a co-equal branch of the
legislature, it cannot frustrate the power of Congress to legislate by refusing to comply
with its demands for information.
When Congress exercises its power of inquiry, the only way for department heads to
exempt themselves therefrom is by a valid claim of privilege. They are not exempt by
the mere fact that they are department heads. Only one executive official may be
exempted from this power the President on whom executive power is vested,
hence, beyond the reach of Congress except through the power of impeachment. It is
based on her being the highest official of the executive branch, and the due respect
accorded to a co-equal branch of government which is sanctioned by a long-standing
custom.
By the same token, members of the Supreme Court are also exempt from this power
of inquiry. Unlike the Presidency, judicial power is vested in a collegial body; hence,
each member thereof is exempt on the basis not only of separation of powers but also
on the fiscal autonomy and the constitutional independence of the judiciary. This point
is not in dispute, as even counsel for the Senate, Sen. Joker Arroyo, admitted it
during the oral argument upon interpellation of the Chief Justice.
In light, however, of Sec 2(a) of E.O. 464 which deals with the nature, scope and
coverage of executive privilege, the reference to persons being "covered by the
executive privilege" may be read as an abbreviated way of saying that the person is in
possession of information which is, in the judgment of the head of office concerned,
privileged as defined in Section 2(a). The Court shall thus proceed on the assumption
that this is the intention of the challenged order.
While there is no Philippine case that directly addresses the issue of whether
executive privilege may be invoked against Congress, it is gathered from Chavez v.
PEA that certain information in the possession of the executive may validly be
claimed as privileged even against Congress. Thus, the case holds:
There is no claim by PEA that the information demanded by petitioner is privileged
information rooted in the separation of powers. The information does not cover
Presidential conversations, correspondences, or discussions during closed-door
Cabinet meetings which, like internal-deliberations of the Supreme Court and other
collegiate courts, or executive sessions of either house of Congress, are recognized
as confidential. This kind of information cannot be pried open by a co-equal branch of
government. A frank exchange of exploratory ideas and assessments, free from the
glare of publicity and pressure by interested parties, is essential to protect the
independence of decision-making of those tasked to exercise Presidential, Legislative
and Judicial power. This is not the situation in the instant case. 91 (Emphasis and
underscoring supplied)
Section 3 of E.O. 464, therefore, cannot be dismissed outright as invalid by the mere
fact that it sanctions claims of executive privilege. This Court must look further and
assess the claim of privilege authorized by the Order to determine whether it is valid.
While the validity of claims of privilege must be assessed on a case to case basis,
examining the ground invoked therefor and the particular circumstances surrounding
it, there is, in an implied claim of privilege, a defect that renders it invalid per se. By its
very nature, and as demonstrated by the letter of respondent Executive Secretary
quoted above, the implied claim authorized by Section 3 of E.O. 464 is not
accompanied by any specific allegation of the basis thereof (e.g., whether the
information demanded involves military or diplomatic secrets, closed-door Cabinet
meetings, etc.). While Section 2(a) enumerates the types of information that are
covered by the privilege under the challenged order, Congress is left to speculate as
to which among them is being referred to by the executive. The enumeration is not
even intended to be comprehensive, but a mere statement of what is included in the
phrase "confidential or classified information between the President and the public
officers covered by this executive order."
Certainly, Congress has the right to know why the executive considers the requested
information privileged. It does not suffice to merely declare that the President, or an
authorized head of office, has determined that it is so, and that the President has not
overturned that determination. Such declaration leaves Congress in the dark on how
the requested information could be classified as privileged. That the message is
couched in terms that, on first impression, do not seem like a claim of privilege only
makes it more pernicious. It threatens to make Congress doubly blind to the question
of why the executive branch is not providing it with the information that it has
requested.
A claim of privilege, being a claim of exemption from an obligation to disclose
information, must, therefore, be clearly asserted. As U.S. v. Reynolds teaches:
The privilege belongs to the government and must be asserted by it; it can neither be
claimed nor waived by a private party. It is not to be lightly invoked. There must be a
formal claim of privilege, lodged by the head of the department which has control over
the matter, after actual personal consideration by that officer. The court itself must
determine whether the circumstances are appropriate for the claim of privilege, and
yet do so without forcing a disclosure of the very thing the privilege is designed to
92
protect. (Underscoring supplied)
instant case because it is legally insufficient to allow the Court to make a just and
reasonable determination as to its applicability. To recognize such a broad claim in
which the Defendant has given no precise or compelling reasons to shield these
documents from outside scrutiny, would make a farce of the whole
101
procedure. (Emphasis and underscoring supplied)
Absent then a statement of the specific basis of a claim of executive privilege, there is
no way of determining whether it falls under one of the traditional privileges, or
whether, given the circumstances in which it is made, it should be respected.93 These,
in substance, were the same criteria in assessing the claim of privilege asserted
against the Ombudsman in Almonte v. Vasquez94 and, more in point, against a
committee of the Senate in Senate Select Committee on Presidential Campaign
Activities v. Nixon.95
Due respect for a co-equal branch of government, moreover, demands no less than a
claim of privilege clearly stating the grounds therefor. Apropos is the following ruling in
McPhaul v. U.S:102
amplifies, thus:
A formal and proper claim of executive privilege requires a specific designation and
description of the documents within its scope as well as precise and certain reasons
for preserving their confidentiality. Without this specificity, it is impossible for a court to
analyze the claim short of disclosure of the very thing sought to be protected. As the
affidavit now stands, the Court has little more than its sua sponte speculation with
which to weigh the applicability of the claim. An improperly asserted claim of privilege
is no claim of privilege. Therefore, despite the fact that a claim was made by the
proper executive as Reynolds requires, the Court can not recognize the claim in the
We think the Courts decision in United States v. Bryan, 339 U.S. 323, 70 S. Ct. 724,
is highly relevant to these questions. For it is as true here as it was there, that if
(petitioner) had legitimate reasons for failing to produce the records of the
association, a decent respect for the House of Representatives, by whose authority
the subpoenas issued, would have required that (he) state (his) reasons for
noncompliance upon the return of the writ. Such a statement would have given the
Subcommittee an opportunity to avoid the blocking of its inquiry by taking other
appropriate steps to obtain the records. To deny the Committee the opportunity to
consider the objection or remedy is in itself a contempt of its authority and an
obstruction of its processes. His failure to make any such statement was "a patent
evasion of the duty of one summoned to produce papers before a congressional
committee[, and] cannot be condoned." (Emphasis and underscoring supplied;
citations omitted)
Upon the other hand, Congress must not require the executive to state the reasons
for the claim with such particularity as to compel disclosure of the information which
the privilege is meant to protect. 103 A useful analogy in determining the requisite
degree of particularity would be the privilege against self-incrimination. Thus, Hoffman
104
v. U.S. declares:
The witness is not exonerated from answering merely because he declares that in so
doing he would incriminate himself his say-so does not of itself establish the hazard
of incrimination. It is for the court to say whether his silence is justified, and to require
him to answer if it clearly appears to the court that he is mistaken. However, if the
witness, upon interposing his claim, were required to prove the hazard in the sense in
which a claim is usually required to be established in court, he would be compelled to
surrender the very protection which the privilege is designed to guarantee. To sustain
the privilege, it need only be evident from the implications of the question, in the
setting in which it is asked, that a responsive answer to the question or an explanation
of why it cannot be answered might be dangerous because injurious disclosure could
result." x x x (Emphasis and underscoring supplied)
The claim of privilege under Section 3 of E.O. 464 in relation to Section 2(b) is thus
invalid per se. It is not asserted. It is merely implied. Instead of providing precise and
certain reasons for the claim, it merely invokes E.O. 464, coupled with an
announcement that the President has not given her consent. It is woefully insufficient
for Congress to determine whether the withholding of information is justified under the
circumstances of each case. It severely frustrates the power of inquiry of Congress.
In fine, Section 3 and Section 2(b) of E.O. 464 must be invalidated.
before Congress and may then opt to avail of the necessary legal means to compel
his appearance.
The Court notes that one of the expressed purposes for requiring officials to secure
the consent of the President under Section 3 of E.O. 464 is to ensure "respect for the
rights of public officials appearing in inquiries in aid of legislation." That such rights
must indeed be respected by Congress is an echo from Article VI Section 21 of the
Constitution mandating that "[t]he rights of persons appearing in or affected by such
inquiries shall be respected."
In light of the above discussion of Section 3, it is clear that it is essentially an
authorization for implied claims of executive privilege, for which reason it must be
invalidated. That such authorization is partly motivated by the need to ensure respect
for such officials does not change the infirm nature of the authorization itself.
Right to Information
E.O 464 is concerned only with the demands of Congress for the appearance of
executive officials in the hearings conducted by it, and not with the demands of
citizens for information pursuant to their right to information on matters of public
concern. Petitioners are not amiss in claiming, however, that what is involved in the
present controversy is not merely the legislative power of inquiry, but the right of the
people to information.
There are, it bears noting, clear distinctions between the right of Congress to
information which underlies the power of inquiry and the right of the people to
information on matters of public concern. For one, the demand of a citizen for the
production of documents pursuant to his right to information does not have the same
obligatory force as a subpoena duces tecum issued by Congress. Neither does the
right to information grant a citizen the power to exact testimony from government
officials. These powers belong only to Congress and not to an individual citizen.
Thus, while Congress is composed of representatives elected by the people, it does
not follow, except in a highly qualified sense, that in every exercise of its power of
inquiry, the people are exercising their right to information.
To the extent that investigations in aid of legislation are generally conducted in public,
however, any executive issuance tending to unduly limit disclosures of information in
such investigations necessarily deprives the people of information which, being
presumed to be in aid of legislation, is presumed to be a matter of public concern. The
citizens are thereby denied access to information which they can use in formulating
their own opinions on the matter before Congress opinions which they can then
communicate to their representatives and other government officials through the
various legal means allowed by their freedom of expression. Thus holds Valmonte v.
Belmonte:
It is in the interest of the State that the channels for free political discussion be
maintained to the end that the government may perceive and be responsive to the
peoples will. Yet, this open dialogue can be effective only to the extent that the
citizenry is informed and thus able to formulate its will intelligently. Only when the
participants in the discussion are aware of the issues and have access to information
relating thereto can such bear fruit.107(Emphasis and underscoring supplied)
The impairment of the right of the people to information as a consequence of E.O.
464 is, therefore, in the sense explained above, just as direct as its violation of the
legislatures power of inquiry.
Resort to any means then by which officials of the executive branch could refuse to
divulge information cannot be presumed valid. Otherwise, we shall not have merely
nullified the power of our legislature to inquire into the operations of government, but
we shall have given up something of much greater value our right as a people to
take part in government.
While E.O. 464 applies only to officials of the executive branch, it does not follow that
the same is exempt from the need for publication. On the need for publishing even
those statutes that do not directly apply to people in general, Taada v. Tuvera states:
Privilege and Respect for the Rights of Public Officials Appearing in Legislative
Inquiries in Aid of Legislation Under the Constitution, and For Other Purposes," are
declared VOID. Sections 1 and 2(a) are, however, VALID.
The term "laws" should refer to all laws and not only to those of general application,
for strictly speaking all laws relate to the people in general albeit there are some that
do not apply to them directly. An example is a law granting citizenship to a particular
individual, like a relative of President Marcos who was decreed instant naturalization.
It surely cannot be said that such a law does not affect the public although it
unquestionably does not apply directly to all the people. The subject of such law is a
matter of public interest which any member of the body politic may question in the
political forums or, if he is a proper party, even in courts of justice. 108 (Emphasis and
underscoring supplied)
SO ORDERED.
Although the above statement was made in reference to statutes, logic dictates that
the challenged order must be covered by the publication requirement. As explained
above, E.O. 464 has a direct effect on the right of the people to information on
matters of public concern. It is, therefore, a matter of public interest which members of
the body politic may question before this Court. Due process thus requires that the
people should have been apprised of this issuance before it was implemented.
Conclusion
Congress undoubtedly has a right to information from the executive branch whenever
it is sought in aid of legislation. If the executive branch withholds such information on
the ground that it is privileged, it must so assert it and state the reason therefor and
why it must be respected.
The infirm provisions of E.O. 464, however, allow the executive branch to evade
congressional requests for information without need of clearly asserting a right to do
so and/or proffering its reasons therefor. By the mere expedient of invoking said
provisions, the power of Congress to conduct inquiries in aid of legislation is
frustrated. That is impermissible. For
[w]hat republican theory did accomplishwas to reverse the old presumption in favor
of secrecy, based on the divine right of kings and nobles, and replace it with a
presumption in favor of publicity, based on the doctrine of popular sovereignty.
(Underscoring supplied)109
KILUSANG MAYO UNO, NATIONAL FEDERATION OF LABOR UNIONSKILUSANG MAYO UNO (NAFLU-KMU), JOSELITO V. USTAREZ, EMILIA P.
DAPULANG, SALVADOR T. CARRANZA, MARTIN T. CUSTODIO, JR. and
ROQUE
M.
TAN, Petitioners,
vs.
THE
DIRECTOR-GENERAL,
NATIONAL
ECONOMIC
DEVELOPMENT
AUTHORITY, and THE SECRETARY, DEPARTMENT OF BUDGET and
MANAGEMENT, Respondents.
x-----------------------------------x
G.R. No. 167930
WHEREAS, there is urgent need to streamline and integrate the processes and
issuance of identification cards in government to reduce costs and to provide greater
convenience for those transacting business with government;
Picture
Signature
Date of Birth
Place of Birth
Marital Status
Names of Parents
Height
Weight
Two index fingers and two thumbmarks
Any prominent distinguishing features like moles and others
Tax Identification Number (TIN)
Provided that a corresponding ID number issued by the participating agency and a
common reference number shall form part of the stored ID data and, together with at
least the first five items listed above, including the print of the right thumbmark, or any
of the fingerprints as collected and stored, shall appear on the face or back of the ID
card for visual verification purposes.
Section 4. Authorizing the Director-General, National Economic and
Development Authority, to Harmonize All Government Identification Systems.
The Director-General, National Economic Development Authority, is hereby
authorized to streamline and harmonize all government ID systems.
Section 5. Functions and responsibilities of the Director-General, National
Economic and Development Authority. In addition to his organic functions and
responsibilities, the Director-General, National Economic and Development Authority,
shall have the following functions and responsibilities:
a. Adopt within sixty (60) days from the effectivity of this executive order a
unified government ID system containing only such data and features, as
indicated in Section 3 above, to validly establish the identity of the card
holder:
a. The data to be recorded and stored, which shall be used only for purposes
of establishing the identity of a person, shall be limited to those specified in
Section 3 of this executive order;
b. In no case shall the collection or compilation of other data in violation of a
persons right to privacy shall be allowed or tolerated under this order;
c. Stringent systems of access control to data in the identification system
shall be instituted;
d. Data collected and stored for this purpose shall be kept and treated as
strictly confidential and a personal or written authorization of the Owner shall
be required for access and disclosure of data;
e. The identification card to be issued shall be protected by advanced
security features and cryptographic technology; and
f. A written request by the Owner of the identification card shall be required
for any correction or revision of relevant data, or under such conditions as
the participating agency issuing the identification card shall prescribe.
Section 7. Funding. Such funds as may be recommended by the Department of
Budget and Management shall be provided to carry out the objectives of this
executive order.
Section 8. Repealing clause. All executive orders or issuances, or portions
thereof, which are inconsistent with this executive order, are hereby revoked,
amended or modified accordingly.
Section 9. Effectivity. This executive order shall take effect fifteen (15) days after
its publication in two (2) newspapers of general circulation.
Thus, under EO 420, the President directs all government agencies and governmentowned and controlled corporations to adopt a uniform data collection and format for
their existing identification (ID) systems.
DONE in the City of Manila, this 13th day of April, in the year of Our Lord, Two
Thousand and Five.
Petitioners in G.R. No. 167930 allege that EO 420 is void based on the following
grounds:
Second, the President may by executive or administrative order direct the government
entities under the Executive department to adopt a uniform ID data collection and
format. Section 17, Article VII of the 1987 Constitution provides that the "President
shall have control of all executive departments, bureaus and offices." The same
Section also mandates the President to "ensure that the laws be faithfully executed."
Certainly, under this constitutional power of control the President can direct all
government entities, in the exercise of their functions under existing laws, to adopt a
uniform ID data collection and ID format to achieve savings, efficiency, reliability,
compatibility, and convenience to the public. The Presidents constitutional power of
control is self-executing and does not need any implementing legislation.
Of course, the Presidents power of control is limited to the Executive branch of
government and does not extend to the Judiciary or to the independent constitutional
commissions. Thus, EO 420 does not apply to the Judiciary, or to the COMELEC
10
which under existing laws is also authorized to issue voters ID cards. This only
shows that EO 420 does not establish a national ID system because legislation is
needed to establish a single ID system that is compulsory for all branches of
government.
The Constitution also mandates the President to ensure that the laws are faithfully
executed. There are several laws mandating government entities to reduce costs,
11
increase efficiency, and in general, improve public services. The adoption of a
uniform ID data collection and format under EO 420 is designed to reduce costs,
increase efficiency, and in general, improve public services. Thus, in issuing EO 420,
the President is simply performing the constitutional duty to ensure that the laws are
faithfully executed.
Making the data collection and recording of government entities unified, and making
their ID formats uniform, will admittedly achieve substantial benefits. These benefits
are savings in terms of procurement of equipment and supplies, compatibility in
systems as to hardware and software, ease of verification and thus increased
reliability of data, and the user-friendliness of a single ID format for all government
entities.
Clearly, EO 420 is well within the constitutional power of the President to promulgate.
The President has not usurped legislative power in issuing EO 420. EO 420 is an
exercise of Executive power the Presidents constitutional power of control over the
Executive department. EO 420 is also compliance by the President of the
constitutional duty to ensure that the laws are faithfully executed.
There is no dispute that government entities can individually limit the collection and
recording of their data to the 14 specific items in Section 3 of EO 420. There is also
no dispute that these government entities can individually adopt the ID format as
specified in Section 3 of EO 420. Such an act is certainly within the authority of the
heads or governing boards of the government entities that are already authorized
under existing laws to issue IDs.
Legislative power is the authority to make laws and to alter or repeal them. In issuing
EO 420, the President did not make, alter or repeal any law but merely implemented
and executed existing laws. EO 420 reduces costs, as well as insures efficiency,
reliability, compatibility and user-friendliness in the implementation of current ID
systems of government entities under existing laws. Thus, EO 420 is simply an
executive issuance and not an act of legislation.
A unified ID system for all these government entities can be achieved in either of two
ways. First, the heads of these existing government entities can enter into a
memorandum of agreement making their systems uniform. If the government entities
can individually adopt a format for their own ID pursuant to their regular functions
under existing laws, they can also adopt by mutual agreement a uniform ID format,
especially if the uniform format will result in substantial savings, greater efficiency,
and optimum compatibility. This is purely an administrative matter, and does not
involve the exercise of legislative power.
The act of issuing ID cards and collecting the necessary personal data for imprinting
on the ID card does not require legislation. Private employers routinely issue ID cards
to their employees. Private and public schools also routinely issue ID cards to their
students. Even private clubs and associations issue ID cards to their members. The
purpose of all these ID cards is simply to insure the proper identification of a person
as an employee, student, or member of a club. These ID cards, although imposed as
a condition for exercising a privilege, are voluntary because a person is not compelled
to be an employee, student or member of a club.
In fact, petitioners in the present cases do not claim that the ID systems of
government entities prior to EO 420 violate their right to privacy. Since petitioners do
not make such claim, they even have less basis to complain against the unified ID
system under EO 420. The data collected and stored for the unified ID system under
EO 420 will be limited to only 14 specific data, and the ID card itself will show only
eight specific data. The data collection, recording and ID card system under EO 420
will even require less data collected, stored and revealed than under the disparate
systems prior to EO 420.
In the present case, EO 420 does not require any special appropriation because the
existing ID card systems of government entities covered by EO 420 have the proper
appropriation or funding. EO 420 is not compulsory on all branches of government
and is not compulsory on all citizens. EO 420 requires a very narrow and focused
collection and recording of personal data while safeguarding the confidentiality of
such data. In fact, the data collected and recorded under EO 420 are far less than the
data collected and recorded under the ID systems existing prior to EO 420.
Prior to EO 420, government entities had a free hand in determining the kind, nature
and extent of data to be collected and stored for their ID systems. Under EO 420,
government entities can collect and record only the 14 specific data mentioned in
Section 3 of EO 420. In addition, government entities can show in their ID cards only
eight of these specific data, seven less data than what the Supreme Courts ID
shows.
EO 420 does not establish a national ID card system. EO 420 does not compel all
citizens to have an ID card. EO 420 applies only to government entities that under
existing laws are already collecting data and issuing ID cards as part of their
governmental functions. Every government entity that presently issues an ID card will
still issue its own ID card under its own name. The only difference is that the ID card
will contain only the five data specified in Section 3 of EO 420, plus the fingerprint, the
agency ID number, and the common reference number which is needed for crossverification to ensure integrity and reliability of identification.
This Court should not interfere how government entities under the Executive
department should undertake cost savings, achieve efficiency in operations, insure
compatibility of equipment and systems, and provide user-friendly service to the
public. The collection of ID data and issuance of ID cards are day-to-day functions of
many government entities under existing laws. Even the Supreme Court has its own
ID system for employees of the Court and all first and second level courts. The Court
is even trying to unify its ID system with those of the appellate courts, namely the
Court of Appeals, Sandiganbayan and Court of Tax Appeals.
There is nothing legislative about unifying existing ID systems of all courts within the
Judiciary. The same is true for government entities under the Executive department. If
government entities under the Executive department decide to unify their existing ID
data collection and ID card issuance systems to achieve savings, efficiency,
compatibility and convenience, such act does not involve the exercise of any
legislative power. Thus, the issuance of EO 420 does not constitute usurpation of
legislative power.
On the Alleged Infringement of the Right to Privacy
All these years, the GSIS, SSS, LTO, Philhealth and other government entities have
been issuing ID cards in the performance of their governmental functions. There have
been no complaints from citizens that the ID cards of these government entities
violate their right to privacy. There have also been no complaints of abuse by these
government entities in the collection and recording of personal identification data.
The right to privacy does not bar the adoption of reasonable ID systems by
government entities. Some one hundred countries have compulsory national ID
systems, including democracies such as Spain, France, Germany, Belgium, Greece,
Luxembourg, and Portugal. Other countries which do not have national ID systems,
like the United States, Canada, Australia, New Zealand, Ireland, the Nordic Countries
12
and Sweden, have sectoral cards for health, social or other public services. Even
with EO 420, the Philippines will still fall under the countries that do not have
compulsory national ID systems but allow only sectoral cards for social security,
health services, and other specific purposes.
Without a reliable ID system, government entities like GSIS, SSS, Philhealth, and
LTO cannot perform effectively and efficiently their mandated functions under existing
laws. Without a reliable ID system, GSIS, SSS, Philhealth and similar government
entities stand to suffer substantial losses arising from false names and identities. The
integrity of the LTOs licensing system will suffer in the absence of a reliable ID
system.
The dissenting opinion cites three American decisions on the right to privacy, namely,
Griswold v. Connecticut,13U.S. Justice Department v. Reporters Committee for
Freedom of the Press,14 and Whalen v. Roe.15 The last two decisions actually support
the validity of EO 420, while the first is inapplicable to the present case.
In Griswold, the U.S. Supreme Court declared unconstitutional a state law that
prohibited the use and distribution of contraceptives because enforcement of the law
would allow the police entry into the bedrooms of married couples. Declared the U.S.
Supreme Court: "Would we allow the police to search the sacred precincts of the
marital bedrooms for telltale signs of the use of contraceptives? The very idea is
repulsive to the notions of privacy surrounding the marriage relationship." Because
the facts and the issue involved in Griswold are materially different from the present
case, Griswold has no persuasive bearing on the present case.
In U.S. Justice Department, the issue was not whether the State could collect and
store information on individuals from public records nationwide but whether the State
could withhold such information from the press. The premise of the issue in U.S.
Justice Department is that the State can collect and store in a central database
information on citizens gathered from public records across the country. In fact, the
law authorized the Department of Justice to collect and preserve fingerprints and
other criminal identification records nationwide. The law also authorized the
Department of Justice to exchange such information with "officials of States, cities
and other institutions." The Department of Justice treated such information as
confidential. A CBS news correspondent and the Reporters Committee demanded the
criminal records of four members of a family pursuant to the Freedom of Information
Act. The U.S. Supreme Court ruled that the Freedom of Information Act expressly
exempts release of information that would "constitute an unwarranted invasion of
personal privacy," and the information demanded falls under that category of exempt
information.
With the exception of the 8 specific data shown on the ID card, the personal data
collected and recorded under EO 420 are treated as "strictly confidential" under
Section 6(d) of EO 420. These data are not only strictly confidential but also personal
matters. Section 7, Article III of the 1987 Constitution grants the "right of the people to
information on matters of public concern." Personal matters are exempt or outside the
coverage of the peoples right to information on matters of public concern. The data
treated as "strictly confidential" under EO 420 being private matters and not matters
of public concern, these data cannot be released to the public or the press. Thus, the
ruling in U.S. Justice Department does not collide with EO 420 but actually supports
the validity EO 420.
Whalen v. Roe is the leading American case on the constitutional protection for
control over information. In Whalen, the U.S. Supreme Court upheld the validity of a
New York law that required doctors to furnish the government reports identifying
patients who received prescription drugs that have a potential for abuse. The
government maintained a central computerized database containing the names and
addresses of the patients, as well as the identity of the prescribing doctors. The law
was assailed because the database allegedly infringed the right to privacy of
individuals who want to keep their personal matters confidential. The U.S. Supreme
Court rejected the privacy claim, and declared:
Disclosures of private medical information to doctors, to hospital personnel, to
insurance companies, and to public health agencies are often an essential part of
modern medical practice even when the disclosure may reflect unfavorably on the
character of the patient. Requiring such disclosures to representatives of the State
having responsibility for the health of the community does not automatically amount to
an impermissible invasion of privacy. (Emphasis supplied)
Compared to the personal medical data required for disclosure to the New York State
in Whalen, the 14 specific data required for disclosure to the Philippine government
under EO 420 are far less sensitive and far less personal. In fact, the 14 specific data
required under EO 420 are routine data for ID systems, unlike the sensitive and
potentially embarrassing medical records of patients taking prescription drugs.
Whalen, therefore, carries persuasive force for upholding the constitutionality of EO
420 as non-violative of the right to privacy.
Subsequent U.S. Supreme Court decisions have reiterated Whalen. In Planned
Parenthood of Central Missouri v. Danforth,16 the U.S. Supreme Court upheld the
validity of a law that required doctors performing abortions to fill up forms, maintain
records for seven years, and allow the inspection of such records by public health
officials. The U.S. Supreme Court ruled that "recordkeeping and reporting
requirements that are reasonably directed to the preservation of maternal health and
that properly respect a patients confidentiality and privacy are permissible."
Again, in Planned Parenthood of Southeastern Pennsylvania v. Casey, 17 the U.S.
Supreme Court upheld a law that required doctors performing an abortion to file a
report to the government that included the doctors name, the womans age, the
number of prior pregnancies and abortions that the woman had, the medical
complications from the abortion, the weight of the fetus, and the marital status of the
woman. In case of state-funded institutions, the law made such information publicly
available. In Casey, the U.S. Supreme Court stated: "The collection of information
with respect to actual patients is a vital element of medical research, and so it cannot
EN BANC
be said that the requirements serve no purpose other than to make abortion more
difficult."
DECISION
The case[15] was raffled to Branch 117 of the Pasay City RTC,
presided by respondent judge Hon. Henrick F. Gingoyon (Hon. Gingoyon). On
the same day that the Complaint was filed, the RTC issued
an Order[16] directing the issuance of a writ of possession to the Government,
authorizing it to take or enter upon the possession of the NAIA 3 facilities.
Citing the case of City of Manila v. Serrano,[17] the RTC noted that it had the
ministerial duty to issue the writ of possession upon the filing of a complaint
for expropriation sufficient in form and substance, and upon deposit made by
the government of the amount equivalent to the assessed value of the
property subject to expropriation. The RTC found these requisites present,
particularly noting that [t]he case record shows that [the Government has]
deposited the assessed value of the [NAIA 3 facilities] in the Land Bank of the
Philippines, an authorized depositary, as shown by the certification attached
to their complaint. Also on the same day, the RTC issued a Writ of
Possession. According to PIATCO, the Government was able to take
possession over the NAIA 3 facilities immediately after the Writ of
Possession was issued.[18]
However, on 4 January 2005, the RTC issued another Order designed to
supplement its 21 December 2004 Order and the Writ of Possession. In the 4
January 2005 Order, now assailed in the present petition, the RTC noted that
its earlier issuance of its writ of possession was pursuant to Section 2, Rule
67 of the 1997 Rules of Civil Procedure. However, it was observed that
Republic Act No. 8974 (Rep. Act No. 8974), otherwise known as An Act to
Facilitate the Acquisition of Right-of-Way, Site or Location for National
Government Infrastructure Projects and For Other Purposes and its
Implementing Rules and Regulations (Implementing Rules) had amended
Rule 67 in many respects.
There are at least two crucial differences between the respective
procedures under Rep. Act No. 8974 and Rule 67. Under the statute, the
Government is required to make immediate payment to the property owner
upon the filing of the complaint to be entitled to a writ of possession,
whereas in Rule 67, the Government is required only to make an initial
deposit with an authorized government depositary. Moreover, Rule 67
prescribes that the initial deposit be equivalent to the assessed value of the
property for purposes of taxation, unlike Rep. Act No. 8974 which provides,
as the relevant standard for initial compensation, the market value of the
property as stated in the tax declaration or the current relevant zonal
valuation of the Bureau of Internal Revenue (BIR), whichever is higher, and
the value of the improvements and/or structures using the replacement cost
method.
Accordingly, on the basis of Sections 4 and 7 of Rep. Act No. 8974
and Section 10 of the Implementing Rules, the RTC made key qualifications
to its earlier issuances. First, it directed the Land Bank of the Philippines,
Baclaran Branch (LBP-Baclaran), to immediately release the amount of
US$62,343,175.77 to PIATCO, an amount which the RTC characterized as
that which the Government specifically made available for the purpose of
this expropriation; and such amount to be deducted from the amount of just
compensation due PIATCO as eventually determined by the RTC. Second, the
(ii) that Hon. Gingoyon erred when he ordered the immediate release
of the amount of US$62.3 Million to PIATCO considering that the assessed
value as alleged in the complaint was only P3 Billion;
(iii) that the RTC could not have prohibited the Government from
enjoining the performance of acts of ownership;
and
Before we delve into the merits of the issues raised by the Government,
it is essential to consider the crucial holding of the Court in its 2004
Resolution in Agan, which we repeat below:
This Court, however, is not unmindful of the reality that
the structures comprising the NAIA IPT III facility are almost
complete and that funds have been spent by PIATCO in their
construction. For the government to take over the said
facility, it has to compensate respondent PIATCO as builder
of the said structures. The compensation must be just and in
accordance with law and equity for the government can not
unjustly enrich itself at the expense of PIATCO and its
investors.[23]
This pronouncement contains the fundamental premises which
permeate this decision of the Court. Indeed, Agan, final and executory as it is,
stands as governing law in this case, and any disposition of the present
petition must conform to the conditions laid down by the Court in its
2004 Resolution.
The 2004 Resolution Which Is
Law of This Case Generally
Permits Expropriation
The pronouncement in the 2004 Resolution is especially
significant to this case in two aspects, namely: (i) that PIATCO must
receive payment of just compensation determined in accordance with
law and equity; and (ii) that the government is barred from taking over
NAIA 3 until such just compensation is paid. The parties cannot be allowed
to evade the directives laid down by this Court through any mode of judicial
action, such as the complaint for eminent domain.
It cannot be denied though that the Court in the 2004 Resolution
prescribed mandatory guidelines which the Government must observe before
it could acquire the NAIA 3 facilities. Thus, the actions of respondent judge
under review, as well as the arguments of the parties must, to merit
affirmation, pass the threshold test of whether such propositions are in
accord with the 2004 Resolution.
The Government does not contest the efficacy of this pronouncement
in the 2004 Resolution,[24] thus its application to the case at bar is not a
matter of controversy. Of course, questions such as what is the standard of
just compensation and which particular laws and equitable principles are
applicable, remain in dispute and shall be resolved forthwith.
The Government has chosen to resort to expropriation, a remedy
available under the law, which has the added benefit of an integrated
process for the determination of just compensation and the payment thereof
to PIATCO. We appreciate that the case at bar is a highly unusual case,
It is the plain intent of Rep. Act No. 8974 to supersede the system of
deposit under Rule 67 with the scheme of immediate payment in cases
involving national government infrastructure projects. The following portion of
the Senate deliberations, cited by PIATCO in its Memorandum, is worth
quoting to cogitate on the purpose behind the plain meaning of the law:
THE CHAIRMAN (SEN. CAYETANO). x x x Because the
Senate believes that, you know, we have to pay the
landowners immediately not by treasury bills but by cash.
Since we are depriving them, you know, upon payment, no,
of possession, we might as well pay them as much, no, hindi
lang 50 percent.
xxx
THE CHAIRMAN (REP. VERGARA). Accepted.
xxx
THE CHAIRMAN (SEN. CAYETANO). Oo. Because this is really
in favor of the landowners, e.
THE CHAIRMAN (REP. VERGARA). Thats why we need to really
secure the availability of funds.
xxx
THE CHAIRMAN (SEN. CAYETANO). No, no. Its the same. It
says here: iyong first paragraph, diba? Iyong zonal
talagang magbabayad muna. In other words, you know,
there must be a payment kaagad. (TSN, Bicameral Conference
on the Disagreeing Provisions of House Bill 1422 and Senate Bill
2117, August 29, 2000, pp. 14-20)
xxx
THE CHAIRMAN (SEN. CAYETANO). Okay, okay, no. Unanguna, it is not deposit, no. Its payment.
REP. BATERINA. Its payment, ho, payment. (Id., p. 63)[31]
Then, there is the matter of the proper amount which should be paid
to PIATCO by the Government before the writ of possession may issue,
consonant to Rep. Act No. 8974.
At this juncture, we must address the observation made by the Office
of the Solicitor General in behalf of the Government that there could be no
BIR zonal valuations on the NAIA 3 facility, as provided in Rep. Act No.
8974, since zonal valuations are only for parcels of land, not for airport
terminals. The Court agrees with this point, yet does not see it as an
impediment for the application of Rep. Act No. 8974.
It must be clarified that PIATCO cannot be reimbursed or justly
compensated for the value of the parcel of land on which NAIA 3 stands.
PIATCO is not the owner of the land on which the NAIA 3 facility is
constructed, and it should not be entitled to just compensation that is
inclusive of the value of the land itself. It would be highly disingenuous to
compensate PIATCO for the value of land it does not own. Its entitlement to
just compensation should be limited to the value of the improvements and/or
structures themselves. Thus, the determination of just compensation cannot
include the BIR zonal valuation under Section 4 of Rep. Act No. 8974.
Under Rep. Act No. 8974, the Government is required to immediately
pay the owner of the property the amount equivalent to the sum of (1) one
hundred percent (100%) of the value of the property based on the current
relevant zonal valuation of the [BIR]; and (2) the value of the improvements
and/or structures as determined under Section 7. As stated above, the BIR
zonal valuation cannot apply in this case, thus the amount subject to
immediate payment should be limited to the value of the improvements
and/or structures as determined under Section 7, with Section 7 referring to
the implementing rules and regulations for the equitable valuation of the
improvements and/or structures on the land. Under the present
implementing rules in place, the valuation of the improvements/structures
are to be based using the replacement cost method. [42] However, the
replacement cost is only one of the factors to be considered in determining
the just compensation.
In addition to Rep. Act No. 8974, the 2004 Resolution in Agan also
mandated that the payment of just compensation should be in accordance
with equity as well. Thus, in ascertaining the ultimate amount of just
compensation, the duty of the trial court is to ensure that such amount
conforms not only to the law, such as Rep. Act No. 8974, but to principles of
equity as well.
Admittedly, there is no way, at least for the present, to immediately
ascertain the value of the improvements and structures since such valuation
is a matter for factual determination.[43] Yet Rep. Act No. 8974 permits an
expedited means by which the Government can immediately take possession
of the property without having to await precise determination of the valuation.
Section 4(c) of Rep. Act No. 8974 states that in case the completion of a
government infrastructure project is of utmost urgency and importance, and
there is no existing valuation of the area concerned, the implementing
agency shall immediately pay the owner of the property its proferred value,
taking into consideration the standards prescribed in Section 5 [of the
law].[44] The proffered value may strike as a highly subjective standard
based solely on the intuition of the government, but Rep. Act No. 8974 does
provide relevant standards by which proffered value should be based,[45] as
well as the certainty of judicial determination of the propriety of the proffered
value.[46]
In filing the complaint for expropriation, the Government alleged to
have deposited the amount of P3 Billion earmarked for expropriation,
representing the assessed value of the property. The making of the deposit,
including the determination of the amount of the deposit, was undertaken
under the erroneous notion that Rule 67, and not Rep. Act No. 8974, is the
applicable law. Still, as regards the amount, the Court sees no impediment to
recognize this sum of P3 Billion as the proffered value under Section 4(b) of
Rep. Act No. 8974. After all, in the initial determination of the proffered value,
the Government is not strictly required to adhere to any predetermined
standards, although its proffered value may later be subjected to judicial
review using the standards enumerated under Section 5 of Rep. Act No. 8974.
How should we appreciate the questioned order of Hon. Gingoyon,
which pegged the amount to be immediately paid to PIATCO at around $62.3
Million? The Order dated 4 January 2005, which mandated such amount,
proves problematic in that regard. While the initial sum of P3 Billion may
have been based on the assessed value, a standard which should not however
apply in this case, the RTC cites without qualification Section 4(a) of Rep. Act
No. 8974 as the basis for the amount of $62.3 Million, thus leaving the
impression that the BIR zonal valuation may form part of the basis for just
compensation, which should not be the case. Moreover, respondent judge
made no attempt to apply the enumerated guidelines for determination of just
compensation under Section 5 of Rep. Act No. 8974, as required for judicial
review of the proffered value.
The Court notes that in the 10 January 2005 Omnibus Order, the
RTC noted that the concessions agreement entered into between the
Government and PIATCO stated that the actual cost of building NAIA 3 was
not less than US$350 Million.[47] The RTC then proceeded to observe that
while Rep. Act No. 8974 required the immediate payment to PIATCO the
amount equivalent to 100% of the value of NAIA 3, the amount deposited by
the Government constituted only 18% of this value. At this point, no binding
import should be given to this observation that the actual cost of building
NAIA 3 was not less than US$350 Million, as the final conclusions on the
amount of just compensation can come only after due ascertainment in
accordance with the standards set under Rep. Act No. 8974, not the
declarations of the parties. At the same time, the expressed linkage between
the BIR zonal valuation and the amount of just compensation in this case, is
revelatory of erroneous thought on the part of the RTC.
We have already pointed out the irrelevance of the BIR zonal
valuation as an appropriate basis for valuation in this case, PIATCO not being
the owner of the land on which the NAIA 3 facilities stand. The subject order
is flawed insofar as it fails to qualify that such standard is inappropriate.
It does appear that the amount of US$62.3 Million was based on the
certification issued by the LBP-Baclaran that the Republic of the Philippines
maintained a total balance in that branch amounting to such amount. Yet the
actual representation of the $62.3 Million is not clear. The Land Bank
Certification expressing such amount does state that it was issued upon
request of the Manila International Airport Authority purportedly as
guaranty deposit for the expropriation complaint.[48] The Government claims
in its Memorandum that the entire amount was made available as a guaranty
fund for the final and executory judgment of the trial court, and not merely
for the issuance of the writ of possession.[49] One could readily conclude that
the entire amount of US$62.3 Million was intended by the Government to
answer for whatever guaranties may be required for the purpose of the
expropriation complaint.
Still, such intention the Government may have had as to the entire
US$62.3 Million is only inferentially established. In ascertaining the proffered
value adduced by the Government, the amount of P3 Billion as the amount
deposited characterized in the complaint as to be held by [Land Bank]
subject to the [RTCs] orders,[50] should be deemed as controlling. There is no
clear evidence that the Government intended to offer US$62.3 Million as the
initial payment of just compensation, the wording of the Land Bank
Certification notwithstanding, and credence should be given to the consistent
position of the Government on that aspect.
In any event, for the RTC to be able to justify the payment of US$62.3
Million to PIATCO and not P3 Billion Pesos, he would have to establish that
the higher amount represents the valuation of the structures/improvements,
and not the BIR zonal valuation on the land wherein NAIA 3 is built.
The Order dated 5 January 2005 fails to establish such integral fact, and in
the absence of contravening proof, the proffered value of P3 Billion, as
presented by the Government, should prevail.
Strikingly, the Government submits that assuming that Rep. Act No.
8974 is applicable, the deposited amount of P3 Billion should be considered
as the proffered value, since the amount was based on comparative values
made by the City Assessor.[51] Accordingly, it should be deemed as having
faithfully complied with the requirements of the statute. [52] While the Court
agrees that P3 Billion should be considered as the correct proffered value, still
we cannot deem the Government as having faithfully complied with Rep. Act
No. 8974. For the law plainly requires direct payment to the property owner,
and not a mere deposit with the authorized government depositary. Without
such direct payment, no writ of possession may be obtained.
Writ of Possession May Not
Be Implemented Until Actual
Receipt by PIATCO of Proferred
Value
The Court thus finds another error on the part of the RTC. The RTC
authorized the issuance of the writ of possession to the Government
notwithstanding the fact that no payment of any amount had yet been made
to PIATCO, despite the clear command of Rep. Act No. 8974 that there must
first be payment before the writ of possession can issue. While the RTC did
direct the LBP-Baclaran to immediately release the amount of US$62 Million
to PIATCO, it should have likewise suspended the writ of possession, nay,
withdrawn it altogether, until the Government shall have actually paid
PIATCO. This is the inevitable consequence of the clear command of Rep. Act
No. 8974 that requires immediate payment of the initially determined amount
of just compensation should be effected. Otherwise, the overpowering
intention of Rep. Act No. 8974 of ensuring payment first before transfer of
repossession would be eviscerated.
Rep. Act No. 8974 represents a significant change from previous
expropriation laws such as Rule 67, or even Section 19 of the Local
Government Code. Rule 67 and the Local Government Code merely provided
that the Government deposit the initial amounts [53] antecedent to acquiring
possession of the property with, respectively, an authorized
Government depositary[54] or the proper court.[55] In both cases, the private
owner does not receive compensation prior to the deprivation of property. On
the other hand, Rep. Act No. 8974 mandates immediate payment of the initial
just compensation prior to the issuance of the writ of possession in favor of
the Government.
Rep. Act No. 8974 is plainly clear in imposing the requirement of
immediate prepayment, and no amount of statutory deconstruction can evade
such requisite. It enshrines a new approach towards eminent domain that
reconciles the inherent unease attending expropriation proceedings with a
position of fundamental equity. While expropriation proceedings have always
demanded just compensation in exchange for private property, the previous
deposit requirement impeded immediate compensation to the private owner,
especially in cases wherein the determination
of the final amount of compensation would prove highly disputed. Under the
new modality prescribed by Rep. Act No. 8974, the private owner sees
immediate monetary recompense with the same degree of speed as the taking
of his/her property.
While eminent domain lies as one of the inherent powers of the State,
there is no requirement that it undertake a prolonged procedure, or that the
payment of the private owner be protracted as far as practicable. In fact, the
expedited procedure of payment, as highlighted under Rep. Act No. 8974, is
inherently more fair, especially to the layperson who would be hard-pressed
to fully comprehend the social value of expropriation in the first place.
Immediate payment placates to some degree whatever ill-will that arises from
expropriation, as well as satisfies the demand of basic fairness.
The Court has the duty to implement Rep. Act No. 8974 and to direct
compliance with the requirement of immediate payment in this case.
Accordingly, the Writ of Possession dated 21 December 2004 should be held
The issuance of the writ of possession does not write finis to the
expropriation proceedings. As earlier pointed out, expropriation is not
completed until payment to the property owner of just compensation. The
proffered value stands as merely a provisional determination of the amount
of just compensation, the payment of which is sufficient to transfer
possession of the property to the Government. However, to effectuate the
transfer of ownership, it is necessary for the Government to pay the property
owner the final just compensation.
Appointment of Commissioners
It must be noted that Rep. Act No. 8974 is silent on the appointment of
commissioners tasked with the ascertainment of just compensation. [67] This
protocol though is sanctioned under Rule 67. We rule that the appointment of
commissioners under Rule 67 may be resorted to, even in expropriation
proceedings under Rep. Act No. 8974, since the application of the provisions
of Rule 67 in that regard do not conflict with the statute. As earlier stated,
Section 14 of the Implementing Rules does allow such other incidents
affecting the complaint to be resolved under the provisions on expropriation of
Rule 67 of the Rules of Court. Even without Rule 67, reference during trial to
a commissioner of the examination of an issue of fact is sanctioned under
Rule 32 of the Rules of Court.
Rep. Act No. 8974 mandates a speedy method by which the final
determination of just compensation may be had. Section 4 provides:
In the event that the owner of the property contests the
implementing agencys proffered value, the court shall determine
the just compensation to be paid the owner within sixty (60) days
from the date of filing of the expropriation case. When the
decision of the court becomes final and executory, the
implementing agency shall pay the owner the difference between
the amount already paid and the just compensation as
determined by the court.
We hold that this provision should apply in this case. The sixty (60)day period prescribed in Rep. Act No. 8974 gives teeth to the laws avowed
policy to ensure that owners of real property acquired for national
government
infrastructure
projects
are promptly
paid just
compensation.[66] In this case, there already has been irreversible delay in
the prompt payment of PIATCO of just compensation, and it is no longer
possible for the RTC to determine the just compensation due PIATCO within
sixty (60) days from the filing of the complaint last 21 December 2004, as
contemplated by the law. Still, it is feasible to effectuate the spirit of the law
by requiring the trial court to make such determination within sixty (60) days
from finality of this decision, in accordance with the guidelines laid down
in Rep. Act No. 8974 and its Implementing Rules.
Of course, once the amount of just compensation has been finally
determined, the Government is obliged to pay PIATCO the said amount. As
shown in Lim and other like-minded cases, the Governments refusal to make
such payment is indubitably actionable in court.
The next argument for consideration is the claim of the Government that
the RTC erred in appointing the three commissioners in its 7 January
2005 Order without prior consultation with either the Government or PIATCO,
or without affording the Government the opportunity to object to the
appointment of these commissioners. We can dispose of this argument
without complication.
respected by the Court absent any evidence to the contrary. As held in Chin v.
Court of Appeals:
An allegation of prejudgment, without more, constitutes
mere conjecture and is not one of the "just and valid reasons"
contemplated in the second paragraph of Rule 137 of the Rules
of Court for which a judge may inhibit himself from hearing the
case. We have repeatedly held that mere suspicion that a judge is
partial to a party is not enough. Bare allegations of partiality and
prejudgment will not suffice in the absence of clear and
convincing evidence to overcome the presumption that the judge
will undertake his noble role to dispense justice according to law
and evidence and without fear or favor. There should be
adequate evidence to prove the allegations, and there must be
showing that the judge had an interest, personal or otherwise, in
the prosecution of the case. To be a disqualifying circumstance,
the bias and prejudice must be shown to have stemmed from an
extrajudicial source and result in an opinion on the merits on
some basis other than what the judge learned from his
participation in the case.[82]
The mere vehemence of the Governments claim of bias does not
translate to clear and convincing evidence of impairing bias. There is no
sufficient ground to direct the inhibition of Hon. Gingoyon from hearing the
expropriation case.
In conclusion, the Court summarizes its rulings as follows:
(1) The 2004 Resolution in Agan sets the base requirement that has to be
observed before the Government may take over the NAIA 3, that there must
be payment to PIATCO of just compensation in accordance with law and
equity. Any ruling in the present expropriation case must be conformable to
the dictates of the Court as pronounced in the Agan cases.
(2) Rep. Act No. 8974 applies in this case, particularly insofar as it
requires the immediate payment by the Government of at least the proffered
value of the NAIA 3 facilities to PIATCO and provides certain valuation
standards or methods for the determination of just compensation.
(3) Applying Rep. Act No. 8974, the implementation of Writ of Possession
in favor of the Government over NAIA 3 is held in abeyance until PIATCO is
directly paid the amount of P3 Billion, representing the proffered value of
NAIA 3 under Section 4(c) of the law.
(4) Applying Rep. Act No. 8974, the Government is authorized to start
the implementation of the NAIA 3 Airport terminal project by performing the
acts that are essential to the operation of the NAIA 3 as an international
airport terminal upon the effectivity of the Writ of Possession, subject to the
conditions above-stated. As prescribed by the Court, such authority
encompasses the repair, reconditioning and improvement of the complex,
maintenance of the existing facilities and equipment, installation of new
2)
3)
FIRST DIVISION
G.R. No. 174689
Petitioner alleged in his petition that he was born in the City of Manila to the spouses
Melecio Petines Silverio and Anita Aquino Dantes on April 4, 1962. His name was
registered as "Rommel Jacinto Dantes Silverio" in his certificate of live birth (birth
certificate). His sex was registered as "male."
Likewise, the [c]ourt believes that no harm, injury [or] prejudice will be
caused to anybody or the community in granting the petition. On the
contrary, granting the petition would bring the much-awaited happiness on
the part of the petitioner and her [fianc] and the realization of their dreams.
He further alleged that he is a male transsexual, that is, "anatomically male but feels,
thinks and acts as a female" and that he had always identified himself with girls since
childhood.1 Feeling trapped in a mans body, he consulted several doctors in the
United States. He underwent psychological examination, hormone treatment and
breast augmentation. His attempts to transform himself to a "woman" culminated on
January 27, 2001 when he underwent sex reassignment surgery2 in Bangkok,
Thailand. He was thereafter examined by Dr. Marcelino Reysio-Cruz, Jr., a plastic
and reconstruction surgeon in the Philippines, who issued a medical certificate
attesting that he (petitioner) had in fact undergone the procedure.
Finally, no evidence was presented to show any cause or ground to deny the
present petition despite due notice and publication thereof. Even the State,
through the [OSG] has not seen fit to interpose any [o]pposition.
From then on, petitioner lived as a female and was in fact engaged to be married. He
then sought to have his name in his birth certificate changed from "Rommel Jacinto"
to "Mely," and his sex from "male" to "female."
On August 18, 2003, the Republic of the Philippines (Republic), thru the OSG, filed a
6
petition for certiorari in the Court of Appeals. It alleged that there is no law allowing
the change of entries in the birth certificate by reason of sex alteration.
An order setting the case for initial hearing was published in the Peoples Journal
Tonight, a newspaper of general circulation in Metro Manila, for three consecutive
weeks.3 Copies of the order were sent to the Office of the Solicitor General (OSG)
and the civil registrar of Manila.
On February 23, 2006, the Court of Appeals7 rendered a decision8 in favor of the
Republic. It ruled that the trial courts decision lacked legal basis. There is no law
allowing the change of either name or sex in the certificate of birth on the ground of
sex reassignment through surgery. Thus, the Court of Appeals granted the Republics
petition, set aside the decision of the trial court and ordered the dismissal of SP Case
No. 02-105207. Petitioner moved for reconsideration but it was denied. 9 Hence, this
petition.
Petitioner essentially claims that the change of his name and sex in his birth
certificate is allowed under Articles 407 to 413 of the Civil Code, Rules 103 and 108 of
the Rules of Court and RA 9048.10
The petition lacks merit.
A Persons First Name Cannot Be Changed On the Ground of Sex
Reassignment
Petitioner invoked his sex reassignment as the ground for his petition for change of
name and sex. As found by the trial court:
Petitioner filed the present petition not to evade any law or judgment or any
infraction thereof or for any unlawful motive but solely for the purpose of
making his birth records compatible with his present sex. (emphasis
supplied)
Petitioner believes that after having acquired the physical features of a female, he
became entitled to the civil registry changes sought. We disagree.
The State has an interest in the names borne by individuals and entities for purposes
of identification.11 A change of name is a privilege, not a right. 12 Petitions for change
of name are controlled by statutes.13 In this connection, Article 376 of the Civil Code
provides:
ART. 376. No person can change his name or surname without judicial
authority.
This Civil Code provision was amended by RA 9048 (Clerical Error Law). In particular,
Section 1 of RA 9048 provides:
SECTION 1. Authority to Correct Clerical or Typographical Error and Change
of First Name or Nickname. No entry in a civil register shall be changed or
corrected without a judicial order, except for clerical or typographical errors
and change of first name or nickname which can be corrected or changed by
the concerned city or municipal civil registrar or consul general in
accordance with the provisions of this Act and its implementing rules and
regulations.
RA 9048 now governs the change of first name.14 It vests the power and authority to
entertain petitions for change of first name to the city or municipal civil registrar or
consul general concerned. Under the law, therefore, jurisdiction over applications for
change of first name is now primarily lodged with the aforementioned administrative
officers. The intent and effect of the law is to exclude the change of first name from
the coverage of Rules 103 (Change of Name) and 108 (Cancellation or Correction of
Entries in the Civil Registry) of the Rules of Court, until and unless an administrative
petition for change of name is first filed and subsequently denied. 15 It likewise lays
down the corresponding venue,16 form17 and procedure. In sum, the remedy and the
proceedings regulating change of first name are primarily administrative in nature, not
judicial.
Petitioners basis in praying for the change of his first name was his sex
reassignment. He intended to make his first name compatible with the sex he thought
he transformed himself into through surgery. However, a change of name does not
18
alter ones legal capacity or civil status. RA 9048 does not sanction a change of first
name on the ground of sex reassignment. Rather than avoiding confusion, changing
petitioners first name for his declared purpose may only create grave complications in
the civil registry and the public interest.
Before a person can legally change his given name, he must present proper or
reasonable cause or any compelling reason justifying such change. 19 In addition, he
must show that he will be prejudiced by the use of his true and official name. 20 In this
case, he failed to show, or even allege, any prejudice that he might suffer as a result
of using his true and official name.
In sum, the petition in the trial court in so far as it prayed for the change of petitioners
first name was not within that courts primary jurisdiction as the petition should have
been filed with the local civil registrar concerned, assuming it could be legally done. It
was an improper remedy because the proper remedy was administrative, that is, that
provided under RA 9048. It was also filed in the wrong venue as the proper venue
was in the Office of the Civil Registrar of Manila where his birth certificate is kept.
More importantly, it had no merit since the use of his true and official name does not
prejudice him at all. For all these reasons, the Court of Appeals correctly dismissed
petitioners petition in so far as the change of his first name was concerned.
No Law Allows The Change of Entry In The Birth Certificate As To Sex On the
Ground of Sex Reassignment
The determination of a persons sex appearing in his birth certificate is a legal issue
and the court must look to the statutes. 21 In this connection, Article 412 of the Civil
Code provides:
RA 9048 likewise provides the grounds for which change of first name may be
allowed:
ART. 412. No entry in the civil register shall be changed or corrected without
a judicial order.
Together with Article 376 of the Civil Code, this provision was amended by RA 9048
in so far as clerical or typographical errors are involved. The correction or change of
such matters can now be made through administrative proceedings and without the
need for a judicial order. In effect, RA 9048 removed from the ambit of Rule 108 of the
Rules of Court the correction of such errors. 22 Rule 108 now applies only to
23
substantial changes and corrections in entries in the civil register.
(1) The petitioner finds the first name or nickname to be ridiculous, tainted
with dishonor or extremely difficult to write or pronounce;
(2) The new first name or nickname has been habitually and continuously
used by the petitioner and he has been publicly known by that first name or
nickname in the community; or
xxx
xxx
in Article 407. Neither is it recognized nor even mentioned by any law, expressly or
impliedly.
"Status" refers to the circumstances affecting the legal situation (that is, the sum total
of capacities and incapacities) of a person in view of his age, nationality and his family
27
membership.
The status of a person in law includes all his personal qualities and
relations, more or less permanent in nature, not ordinarily terminable at
his own will, such as his being legitimate or illegitimate, or his being married
or not. The comprehensive term status include such matters as the
beginning and end of legal personality, capacity to have rights in general,
family relations, and its various aspects, such as birth, legitimation, adoption,
emancipation,
marriage,
divorce,
and
sometimes
even
succession.28 (emphasis supplied)
A persons sex is an essential factor in marriage and family relations. It is a part of a
persons legal capacity and civil status. In this connection, Article 413 of the Civil
Code provides:
ART. 413. All other matters pertaining to the registration of civil status shall
be governed by special laws.
But there is no such special law in the Philippines governing sex reassignment and its
effects. This is fatal to petitioners cause.
Moreover, Section 5 of Act 3753 (the Civil Register Law) provides:
SEC. 5. Registration and certification of births. The declaration of the
physician or midwife in attendance at the birth or, in default thereof, the
declaration of either parent of the newborn child, shall be sufficient for the
registration of a birth in the civil register. Such declaration shall be exempt
from documentary stamp tax and shall be sent to the local civil registrar not
later than thirty days after the birth, by the physician or midwife in attendance
at the birth or by either parent of the newborn child.
In such declaration, the person above mentioned shall certify to the following
facts: (a) date and hour of birth; (b) sex and nationality of infant; (c) names,
citizenship and religion of parents or, in case the father is not known, of the
mother alone; (d) civil status of parents; (e) place where the infant was born;
and (f) such other data as may be required in the regulations to be issued.
xxx
xxx
Under the Civil Register Law, a birth certificate is a historical record of the facts as
29
they existed at the time of birth. Thus, the sex of a person is determined at
birth, visually done by the birth attendant (the physician or midwife) by examining the
genitals of the infant. Considering that there is no law legally recognizing sex
reassignment, the determination of a persons sex made at the time of his or her birth,
if not attended by error, 30is immutable.31
When words are not defined in a statute they are to be given their common and
ordinary meaning in the absence of a contrary legislative intent. The words "sex,"
"male" and "female" as used in the Civil Register Law and laws concerning the civil
registry (and even all other laws) should therefore be understood in their common and
ordinary usage, there being no legislative intent to the contrary. In this connection,
sex is defined as "the sum of peculiarities of structure and function that distinguish a
male from a female"32 or "the distinction between male and female."33 Female is "the
sex that produces ova or bears young"34 and male is "the sex that has organs to
produce spermatozoa for fertilizing ova."35 Thus, the words "male" and "female" in
everyday understanding do not include persons who have undergone sex
reassignment. Furthermore, "words that are employed in a statute which had at the
time a well-known meaning are presumed to have been used in that sense unless the
context compels to the contrary."36 Since the statutory language of the Civil Register
Law was enacted in the early 1900s and remains unchanged, it cannot be argued that
the term "sex" as used then is something alterable through surgery or something that
allows a post-operative male-to-female transsexual to be included in the category
"female."
For these reasons, while petitioner may have succeeded in altering his body and
appearance through the intervention of modern surgery, no law authorizes the change
of entry as to sex in the civil registry for that reason. Thus, there is no legal basis for
his petition for the correction or change of the entries in his birth certificate.
Neither May Entries in the Birth Certificate As to First Name or Sex Be Changed
on the Ground of Equity
The trial court opined that its grant of the petition was in consonance with the
principles of justice and equity. It believed that allowing the petition would cause no
harm, injury or prejudice to anyone. This is wrong.
The changes sought by petitioner will have serious and wide-ranging legal and public
policy consequences. First, even the trial court itself found that the petition was but
petitioners first step towards his eventual marriage to his male fianc. However,
marriage, one of the most sacred social institutions, is a special contract of permanent
37
union between a man and a woman. One of its essential requisites is the legal
capacity of the contracting parties who must be a male and a female.38 To grant the
changes sought by petitioner will substantially reconfigure and greatly alter the laws
on marriage and family relations. It will allow the union of a man with another man
who has undergone sex reassignment (a male-to-female post-operative transsexual).
Second, there are various laws which apply particularly to women such as the
provisions of the Labor Code on employment of women, 39 certain felonies under the
40
Revised Penal Code and the presumption of survivorship in case of calamities
41
under Rule 131 of the Rules of Court, among others. These laws underscore the
public policy in relation to women which could be substantially affected if petitioners
petition were to be granted.
It is true that Article 9 of the Civil Code mandates that "[n]o judge or court shall
decline to render judgment by reason of the silence, obscurity or insufficiency of the
law." However, it is not a license for courts to engage in judicial legislation. The duty
of the courts is to apply or interpret the law, not to make or amend it.
In our system of government, it is for the legislature, should it choose to do so, to
determine what guidelines should govern the recognition of the effects of sex
reassignment. The need for legislative guidelines becomes particularly important in
this case where the claims asserted are statute-based.
To reiterate, the statutes define who may file petitions for change of first name and for
correction or change of entries in the civil registry, where they may be filed, what
grounds may be invoked, what proof must be presented and what procedures shall be
observed. If the legislature intends to confer on a person who has undergone sex
reassignment the privilege to change his name and sex to conform with his
reassigned sex, it has to enact legislation laying down the guidelines in turn governing
the conferment of that privilege.
It might be theoretically possible for this Court to write a protocol on when a person
may be recognized as having successfully changed his sex. However, this Court has
no authority to fashion a law on that matter, or on anything else. The Court cannot
enact a law where no law exists. It can only apply or interpret the written word of its
co-equal branch of government, Congress.
Petitioner pleads that "[t]he unfortunates are also entitled to a life of happiness,
contentment and [the] realization of their dreams." No argument about that. The Court
recognizes that there are people whose preferences and orientation do not fit neatly
into the commonly recognized parameters of social convention and that, at least for
them, life is indeed an ordeal. However, the remedies petitioner seeks involve
questions of public policy to be addressed solely by the legislature, not by the courts.
WHEREFORE, the petition is hereby DENIED.
Costs against petitioner.
SO ORDERED.
Puno, C.J., Chairperson, Sandoval-Gutierrez, Azcuna, Garcia, JJ., concur.
EN BANC
Commission held public hearings and conducted its own investigation, then on 13
March 2002, issued its Formal Investigation Report (Report). The Report determined
as follows:
The elements of serious injury and imminent threat of serious injury not having been
established, it is hereby recommended that no definitive general safeguard measure be
imposed on the importation of gray Portland cement. [7]
The DTI sought the opinion of the Secretary of Justice whether it could still
impose a definitive safeguard measure notwithstanding the negative finding of the
Tariff Commission. After the Secretary of Justice opined that the DTI could not do so
under the SMA,[8] the DTI Secretary then promulgated a Decision[9] wherein he
expressed the DTIs disagreement with the conclusions of the Tariff Commission, but
at the same time, ultimately denying Philcemcors application for safeguard measures
on the ground that the he was bound to do so in light of the Tariff Commissions
[10]
negative findings.
Philcemcor challenged this Decision of the DTI Secretary by filing with the Court
of Appeals a Petition for Certiorari, Prohibition and Mandamus[11] seeking to set aside
the DTIDecision, as well as the Tariff Commissions Report. It prayed that the Court
of Appeals direct the DTI Secretary to disregard the Report and to render judgment
independently of the Report. Philcemcor argued that the DTI Secretary, vested as he
is under the law with the power of review, is not bound to adopt the recommendations
of the Tariff Commission; and, that the Report is void, as it is predicated on a flawed
framework, inconsistent inferences and erroneous methodology. [12]
[13]
definitive safeguard duty in the amount of P20.60/40 kg. bag for three years on
imported gray Portland Cement.[19]
On 7 July 2003, Southern Cross filed with the Court a Very Urgent Application
for a Temporary Restraining Order and/or A Writ of Preliminary Injunction
(TRO Application), seeking to enjoin the DTI Secretary from enforcing
his Decision of 25 June 2003 in view of the pending petition before this
Court. Philcemcor filed an opposition, claiming, among others, that it is not this Court
but the CTA that has jurisdiction over the application under the law.
On 1 August 2003, Southern Cross filed with the CTA a Petition for Review,
assailing the DTI Secretarys 25 June 2003 Decision which imposed the definite
safeguard measure. Yet Southern Cross did not promptly inform this Court about this
filing. The first time the Court would learn about this Petition with the CTA was when
Southern Cross mentioned such fact in a pleading dated 11 August 2003 and filed the
next day with this Court.[20]
Philcemcor argued before this Court that Southern Cross had deliberately and
willfully resorted to forum-shopping; that the CTA, being a special court of limited
jurisdiction, could only review the ruling of the DTI Secretary when a safeguard
measure is imposed; and that the factual findings of the Tariff Commission are not
binding on the DTI Secretary.[21]
After giving due course to Southern Crosss Petition, the Court called the case
[22]
for oral argument on 18 February 2004. At the oral argument, attended by the
counsel for Philcemcor and Southern Cross and the Office of the Solicitor General,
the Court simplified the issues in this wise: (i) whether the Decision of the DTI
Secretary is appealable to the CTA or the Court of Appeals; (ii) assuming that the
Court of Appeals has jurisdiction, whether its Decision is in accordance with law; and,
whether a Temporary Restraining Order is warranted.[23]
After the parties had filed their respective memoranda, the Courts Second
Division, to which the case had been assigned, promulgated its Decision granting
[24]
Southern Crosss Petition. The Decision was unanimous, without any separate or
concurring opinion.
The Court ruled that the Court of Appeals had no jurisdiction over
Philcemcors Petition, the proper remedy under Section 29 of the SMA being a
petition for review with the CTA; and that the Court of Appeals erred in ruling that the
DTI Secretary was not bound by the negative determination of the Tariff Commission
and could therefore impose the general safeguard measures, since Section 5 of the
SMA precisely required that the Tariff Commission make a positive final determination
before the DTI Secretary could impose these measures. Anent the argument that
Southern Cross had committed forum-shopping, the Court concluded that there was
no evident malicious intent to subvert procedural rules so as to match the standard
under Section 5, Rule 7 of the Rules of Court of willful and deliberate forum shopping.
Accordingly, the Decision of the Court of Appeals dated 5 June 2003 was declared
null and void.
The Court likewise found it necessary to nullify the Decision of the DTI Secretary
dated 25 June 2003, rendered after the filing of this present Petition. This Decision by
the DTI Secretary had cited the obligatory force of the null and void Court of
Appeals Decision, notwithstanding the fact that the decision of the appellate court
was not yet final and executory. Considering that the decision of the Court of Appeals
was a nullity to begin with, the inescapable conclusion was that the new decision of
the DTI Secretary, prescinding as it did from the imprimatur of the decision of the
Court of Appeals, was a nullity as well.
After the Decision was reported in the media, there was a flurry of newspaper
articles citing alleged negative reactions to the ruling by the counsel for Philcemcor,
the DTI Secretary, and others. [25] Both respondents promptly filed their respective
motions for reconsideration.
On 21 September 2004, the Court En Banc resolved, upon motion of
respondents,
to
accept
the
petition
and
resolve
the Motions
for
Reconsideration.[26] The case was then reheard[27] on oral argument on 1 March 2005.
During the hearing, the Court elicited from the parties their arguments on the two
central issues as discussed in the assailed Decision, pertaining to the jurisdictional
aspect and to the substantive aspect of whether the DTI Secretary may impose a
general safeguard measure despite a negative determination by the Tariff
Commission. The Court chose not to hear argumentation on the peripheral issue of
[28]
forum-shopping, although this question shall be tackled herein shortly. Another
point of concern emerged during oral arguments on the exercise of quasi-judicial
powers by the Tariff Commission, and the parties were required by the Court to
discuss in their respective memoranda whether the Tariff Commission could validly
exercise quasi-judicial powers in the exercise of its mandate under the SMA.
The Court has likewise been notified that subsequent to the rendition of the
Courts Decision, Philcemcor filed a Petition for Extension of the Safeguard
Measure with the DTI, which has been referred to the Tariff Commission. [29] In
an Urgent Motion dated 21 December 2004, Southern Cross prayed that Philcemcor,
the DTI, the Bureau of Customs, and the Tariff Commission be directed to cease and
desist from taking any and all actions pursuant to or under the null and void CA
Decision and DTI Decision, including proceedings to extend the safeguard
[30]
measure. In a Manifestation and Motion dated 23 June 2004, the Tariff
Commission informed the Court that since no prohibitory injunction or order of such
nature had been issued by any court against the Tariff Commission, the Commission
proceeded to complete its investigation on the petition for extension, pursuant to
Section 9 of the SMA, but opted to defer transmittal of its report to the DTI Secretary
pending guidance from this Court on the propriety of such a step considering this
pending Motion for Reconsideration. In a Resolutiondated 5 July 2005, the Court
directed the parties to maintain the status quo effective of even date, and until further
orders from this Court. The denial of the pending motions for reconsideration will
obviously render the pending petition for extension academic.
The first core issue resolved in the assailed Decision was whether the Court of
Appeals had jurisdiction over the special civil action for certiorari filed by Philcemcor
assailing the 5 April 2002 Decision of the DTI Secretary. The general jurisdiction of
the Court of Appeals over special civil actions for certiorari is beyond doubt. The
Constitution itself assures that judicial review avails to determine whether or not there
has been a grave abuse of discretion amounting to lack or excess of jurisdiction on
the part of any branch or instrumentality of the Government. At the same time, the
special civil action of certiorari is available only when there is no plain, speedy and
adequate remedy in the ordinary course of law.[31] Philcemcors recourse of special
civil action before the Court of Appeals to challenge the Decision of the DTI Secretary
not to impose the general safeguard measures is not based on the SMA, but on the
general rule on certiorari. Thus, the Court proceeded to inquire whether indeed there
was no other plain, speedy and adequate remedy in the ordinary course of law that
would warrant the allowance of Philcemcors special civil action.
The answer hinged on the proper interpretation of Section 29 of the SMA, which
reads:
Section 29. Judicial Review. Any interested party who is adversely affected by the ruling of
the Secretary in connection with the imposition of a safeguard measure may file with the
CTA, a petition for review of such ruling within thirty (30) days from receipt thereof.
Provided, however, that the filing of such petition for review shall not in any way stop,
suspend or otherwise toll the imposition or collection of the appropriate tariff duties or the
adoption of other appropriate safeguard measures, as the case may be.
The petition for review shall comply with the same requirements and shall follow the same
rules of procedure and shall be subject to the same disposition as in appeals in connection with
adverse rulings on tax matters to the Court of Appeals.[32] (Emphasis supplied)
The matter is crucial for if the CTA properly had jurisdiction over the petition
challenging the DTI Secretarys ruling not to impose a safeguard measure, then the
special civil action of certiorari resorted to instead by Philcemcor would not avail,
owing to the existence of a plain, speedy and adequate remedy in the ordinary course
of law.[33] The Court of Appeals, in asserting that it had jurisdiction, merely cited the
general rule on certiorari jurisdiction without bothering to refer to, or possibly even
study, the import of Section 29. In contrast, this Court duly considered the meaning
and ramifications of Section 29, concluding that it provided for a plain, speedy and
adequate remedy that Philcemcor could have resorted to instead of filing the special
civil action before the Court of Appeals.
Philcemcor still holds on to its hypothesis that the petition for review allowed
under Section 29 lies only if the DTI Secretarys ruling imposes a safeguard measure.
If, on the other hand, the DTI Secretarys ruling is not to impose a safeguard
measure, judicial review under Section 29 could not be resorted to since the provision
refers to rulings in connection with the imposition of the safeguard measure, as
opposed to the non-imposition. Since the Decision dated 5 April 2002 resolved
against imposing a safeguard measure, Philcemcor claims that the proper remedial
recourse is a petition for certiorari with the Court of Appeals.
Interestingly, Republic Act No. 9282, promulgated on 30 March 2004, expressly
vests unto the CTA jurisdiction over [d]ecisions of the Secretary of Trade and
Industry, in case of nonagricultural product, commodity or article . . . involving . .
. safeguard measures under Republic Act No. 8800, where either party may
[34]
appeal the decision to impose or not to impose said duties. It is clear that any
future attempts to advance the literalist position of the respondents would
consequently
fail.
However,
since
Republic
Act
No.
9282
has no retroactive effect, this Court had to decide whether Section 29 vests
jurisdiction on the CTA over rulings of the DTI Secretary not to impose a safeguard
measure. And the Court, in its assailed Decision, ruled that the CTA is endowed with
such jurisdiction.
Both respondents reiterate their fundamentalist reading that Section 29
authorizes the petition for review before the CTA only when the DTI Secretary
decides to impose a safeguard measure, but not when he decides not to. In doing so,
they fail to address what the Court earlier pointed out would be the absurd
consequences if their interpretation is followed to its logical end. But in affirming, as
the Court now does, its previous holding that the CTA has jurisdiction over petitions
for review questioning the non-imposition of safeguard measures by the DTI
Secretary, the Court relies on the plain reading that Section 29 explicitly vests
jurisdiction over such petitions on the CTA.
Under Section 29, there are three requisites to enable the CTA to acquire
jurisdiction over the petition for review contemplated therein: (i) there must be a ruling
by the DTI Secretary; (ii) the petition must be filed by an interested party adversely
affected by the ruling; and (iii) such ruling must be in connection with the imposition
of a safeguard measure. Obviously, there are differences between a ruling for the
imposition of a safeguard measure, and one issued in connection with the imposition
of a safeguard measure. The first adverts to a singular type of ruling, namely one
that imposes a safeguard measure. The second does not contemplate only one kind
of ruling, but a myriad of rulings issued in connection with the imposition of a
safeguard measure.
Respondents argue that the Court has given an expansive interpretation to
Section 29, contrary to the established rule requiring strict construction against the
existence of jurisdiction in specialized courts. [35] But it is the express provision of
Section 29, and not this Court, that mandates CTA jurisdiction to be broad
enough to encompass more than just a ruling imposing the safeguard measure.
The key phrase remains in connection with. It has connotations that are
obvious even to the layman. A ruling issued in connection with the imposition of a
safeguard measure would be one that bears some relation to the imposition of a
safeguard measure. Obviously, a ruling imposing a safeguard measure is covered by
the phrase in connection with, but such ruling is by no means exclusive. Rulings
which modify, suspend or terminate a safeguard measure are necessarily in
connection with the imposition of a safeguard measure. So does a ruling allowing for
a provisional safeguard measure. So too, a ruling by the DTI Secretary refusing to
refer the application for a safeguard measure to the Tariff Commission. It is clear that
there is an entire subset of rulings that the DTI Secretary may issue in connection
with the imposition of a safeguard measure, including those that are provisional,
interlocutory, or dispositive in character. [36] By the same token, a ruling not to impose
a safeguard measure is also issued in connection with the imposition of a safeguard
measure.
In arriving at the proper interpretation of in connection with, the Court referred
to the U.S. Supreme Court cases of Shaw v. Delta Air Lines, Inc.[37] and New York
[38]
State Blue Cross Plans v. Travelers Ins. Both cases considered the interpretation
of the phrase relates to as used in a federal statute, the Employee Retirement
Security Act of 1974. Respondents criticize the citations on the premise that the
cases are not binding in our jurisdiction and do not involve safeguard measures. The
criticisms are off-tangent considering that our ruling did not call for the application of
the Employee Retirement Security Act of 1974 in the Philippine milieu. The American
cases are not relied upon as precedents, but as guides of interpretation. Certainly, if
there are applicable local precedents pertaining to the interpretation of the phrase in
connection with, then these certainly would have some binding force. But none avail,
and neither do the respondents demonstrate a countervailing holding in Philippine
jurisprudence.
Yet we should consider the claim that an expansive interpretation was favored
in Shaw because the law in question was an employees benefit law that had to be
given an interpretation favorable to its intended beneficiaries. [39] In the next breath,
Philcemcor notes that the U.S. Supreme Court itself was alarmed by the expansive
interpretation in Shaw and thus in Blue Cross, the Shaw ruling was reversed and a
more restrictive interpretation was applied based on congressional intent. [40]
Respondents would like to make it appear that the Court acted rashly in applying
a discarded precedent in Shaw, a non-binding foreign precedent nonetheless. But the
Court did make the following observation in its Decision pertaining to Blue Cross:
Now, let us determine the maximum scope and reach of the phrase in connection with as
used in Section 29 of the SMA. A literalist reading or linguistic survey may not satisfy. Even
the U.S. Supreme Court in New York State Blue Cross Plans v. Travelers Ins.[41] conceded that
the phrases relate to or in connection with may be extended to the farthest stretch of
indeterminacy for, universally, relations or connections are infinite and stop
nowhere.[42] Thus, in the case the U.S. High Court, examining the same phrase of the
same provision of law involved in Shaw, resorted to looking at the statute and its
objectives as the alternative to an uncritical literalism. A similar inquiry into the other
provisions of the SMA is in order to determine the scope of review accorded therein to
the CTA.[43]
In the next four paragraphs of the Decision, encompassing four pages, the Court
proceeded to inquire into the SMA and its objectives as a means to determine the
scope of rulings to be deemed as in connection with the imposition of a safeguard
measure. Certainly, this Court did not resort to the broadest interpretation possible of
the phrase in connection with, but instead sought to bring it into the context of the
scope and objectives of the SMA. The ultimate conclusion of the Court was that the
phrase includes all rulings of the DTI Secretary which arise from the time an
application or motu proprio initiation for the imposition of a safeguard measure is
taken.[44] This conclusion was derived from the observation that the imposition of a
general safeguard measure is a process, initiated motu proprio or through application,
which undergoes several stages upon which the DTI Secretary is obliged or may be
called upon to issue a ruling.
It should be emphasized again that by utilizing the phrase in connection with, it
is the SMA that expressly vests jurisdiction on the CTA over petitions questioning the
non-imposition by the DTI Secretary of safeguard measures. The Court is simply
asserting, as it should, the clear intent of the legislature in enacting the SMA. Without
in connection with or a synonymous phrase, the Court would be compelled to favor
the respondents position that only rulings imposing safeguard measures may be
elevated on appeal to the CTA. But considering that the statute does make use of the
phrase, there is little sense in delving into alternate scenarios.
Respondents fail to convincingly address the absurd consequences pointed out
by the Decision had their proposed interpretation been adopted. Indeed, suffocated
Finally on this point, Philcemcor argues that assuming this Courts interpretation
of Section 29 is correct, such ruling should not be given retroactive effect, otherwise,
a gross violation of the right to due process would be had. This erroneously
presumes that it was this Court, and not Congress, which vested jurisdiction on the
CTA over rulings of non-imposition rendered by the DTI Secretary. We have
repeatedly stressed that Section 29 expressly confers CTA jurisdiction over rulings in
connection with the imposition of the safeguard measure, and the reassertion of this
point in the Decision was a matter of emphasis, not of contrivance. The due process
protection does not shield those who remain purposely blind to the express rules that
ensure the sporting play of procedural law.
Besides, respondents claim would also apply every time this Court is compelled
to settle a novel question of law, or to reverse precedent. In such cases, there would
always be litigants whose causes of action might be vitiated by the application of
newly formulated judicial doctrines. Adopting their claim would unwisely force this
Court to treat its dispositions in unprecedented, sometimes landmark decisions not as
resolutions to the live cases or controversies, but as legal doctrine applicable only to
future litigations.
The second core ruling in the Decision was that contrary to the holding of the
Court of Appeals, the DTI Secretary was barred from imposing a general safeguard
measure absent a positive final determination rendered by the Tariff Commission. The
fundamental premise rooted in this ruling is based on the acknowledgment that the
required positive final determination of the Tariff Commission exists as a properly
enacted constitutional limitation imposed on the delegation of the legislative power to
impose tariffs and imposts to the President under Section 28(2), Article VI of the
Constitution.
The safeguard measures imposable under the SMA generally involve duties on
imported products, tariff rate quotas, or quantitative restrictions on the importation of a
product into the country. Concerning as they do the foreign importation of products
into the Philippines, these safeguard measures fall within the ambit of Section 28(2),
Article VI of the Constitution, which states:
The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restrictions as it may impose, tariff rates, import and export
quotas, tonnage and wharfage dues, and other duties or imposts within the framework of the
national development program of the Government. [49]
The Court acknowledges the basic postulates ingrained in the provision, and,
hence, governing in this case. They are:
(1) It is Congress which authorizes the President to impose tariff rates,
import and export quotas, tonnage and wharfage dues, and other duties or
imposts. Thus, the authority cannot come from the Finance Department, the
National Economic Development Authority, or the World Trade Organization, no
matter how insistent or persistent these bodies may be.
(2) The authorization granted to the President must be embodied in a law.
Hence, the justification cannot be supplied simply by inherent executive powers. It
cannot arise from administrative or executive orders promulgated by the executive
branch or from the wisdom or whim of the President.
(3) The authorization to the President can be exercised only within the
specified limits set in the law and is further subject to limitations and
restrictions which Congress may impose. Consequently, if Congress specifies
that the tariff rates should not exceed a given amount, the President cannot impose a
tariff rate that exceeds such amount. If Congress stipulates that no duties may be
imposed on the importation of corn, the President cannot impose duties on corn, no
matter how actively the local corn producers lobby the President. Even the most
picayune of limits or restrictions imposed by Congress must be observed by the
President.
There is one fundamental principle that animates these constitutional
postulates. These impositions under Section 28(2), Article VI fall within the realm
of the power of taxation, a power which is within the sole province of the
legislature under the Constitution.
Without Section 28(2), Article VI, the executive branch has no authority to
impose tariffs and other similar tax levies involving the importation of foreign
goods. Assuming that Section 28(2) Article VI did not exist, the enactment of the
SMA by Congress would be voided on the ground that it would constitute an undue
delegation of the legislative power to tax. The constitutional provision shields such
delegation from constitutional infirmity, and should be recognized as an exceptional
grant of legislative power to the President, rather than the affirmation of an inherent
executive power.
This being the case, the qualifiers mandated by the Constitution on this
presidential authority attain primordial consideration. First, there must be a law, such
as the SMA. Second, there must be specified limits, a detail which would be filled in
by the law. And further, Congress is further empowered to impose limitations and
restrictions on this presidential authority. On this last power, the provision does not
provide for specified conditions, such as that the limitations and restrictions must
conform to prior statutes, internationally accepted practices, accepted jurisprudence,
or the considered opinion of members of the executive branch.
The Court recognizes that the authority delegated to the President under
Section 28(2), Article VI may be exercised, in accordance with legislative sanction, by
the alter egos of the President, such as department secretaries. Indeed, for purposes
of the Presidents exercise of power to impose tariffs under Article VI, Section 28(2), it
is generally the Secretary of Finance who acts as alter ego of the President. The
SMA provides an exceptional instance wherein it is the DTI or Agriculture Secretary
who is tasked by Congress, in their capacities as alter egosof the President, to
impose such measures. Certainly, the DTI Secretary has no inherent power, even
as alter ego of the President, to levy tariffs and imports.
Concurrently, the tasking of the Tariff Commission under the SMA should be
likewise construed within the same context as part and parcel of the legislative
delegation of its inherent power to impose tariffs and imposts to the executive branch,
subject to limitations and restrictions. In that regard, both the Tariff Commission and
the DTI Secretary may be regarded as agents of Congress within their limited
respective spheres, as ordained in the SMA, in the implementation of the said law
which significantly draws its strength from the plenary legislative power of
taxation. Indeed, even the President may be considered as an agent of
Congress for the purpose of imposing safeguard measures. It is Congress, not
the President, which possesses inherent powers to impose tariffs and imposts.
Without legislative authorization through statute, the President has no power,
authority or right to impose such safeguard measures because taxation is
inherently legislative, not executive.
When Congress tasks the President or his/her alter egos to impose
safeguard measures under the delineated conditions, the President or the alter
egos may be properly deemed as agents of Congress to perform an act that
inherently belongs as a matter of right to the legislature. It is basic agency law
that the agent may not act beyond the specifically delegated powers or disregard the
restrictions imposed by the principal. In short, Congress may establish the procedural
framework under which such safeguard measures may be imposed, and assign the
various offices in the government bureaucracy respective tasks pursuant to the
imposition of such measures, the task assignment including the factual determination
of whether the necessary conditions exists to warrant such impositions. Under the
SMA, Congress assigned the DTI Secretary and the Tariff Commission their
respective functions[50] in the legislatures scheme of things.
There is only one viable ground for challenging the legality of the limitations and
restrictions imposed by Congress under Section 28(2) Article VI, and that is such
limitations and restrictions are themselves violative of the Constitution. Thus, no
matter how distasteful or noxious these limitations and restrictions may seem, the
Court has no choice but to uphold their validity unless their constitutional infirmity can
be demonstrated.
What are these limitations and restrictions that are material to the present case?
The entire SMA provides for a limited framework under which the President, through
the DTI and Agriculture Secretaries, may impose safeguard measures in the form of
tariffs and similar imposts. The limitation most relevant to this case is contained in
Section 5 of the SMA, captioned Conditions for the Application of General Safeguard
Measures, and stating:
The Secretary shall apply a general safeguard measure upon a positive final
determination of the [Tariff] Commission that a product is being imported into the country
in increased quantities, whether absolute or relative to the domestic production, as to be a
substantial cause of serious injury or threat thereof to the domestic industry; however, in the
case of non-agricultural products, the Secretary shall first establish that the application of such
safeguard measures will be in the public interest. [51]
For the same reason that Section 5 is explicit as regards the essentiality of a
positive final determination by the Tariff Commission, there is no need to refer to the
Implementing Rules of the SMA to ascertain a contrary intent. If there is indeed a
provision in the Implementing Rules that allows the DTI Secretary to impose a general
safeguard measure even without the positive final determination by the Tariff
Commission, said rule is void as it cannot supplant the express language of the
legislature. Respondents essentially rehash their previous arguments on this point,
and there is no reason to consider them anew. The Decision made it clear that
nothing in Rule 13.2 of the Implementing Rules, even though captioned Final
Determination by the Secretary, authorizes the DTI Secretary to impose a general
safeguard measure in the absence of a positive final determination by the Tariff
[59]
Commission. Similarly, the Rules and Regulations to Govern the Conduct of
Investigation by the Tariff Commission Pursuant to Republic Act No. 8800 now cited
by the respondent does not contain any provision that the DTI Secretary may impose
the general safeguard measures in the absence of a positive final determination by
the Tariff Commission.
Section 13 of the SMA further bolsters the interpretation as argued by Southern
Cross and upheld by the Decision. The first paragraph thereof states that [u]pon its
positive determination, the [Tariff] Commission shall recommend to the Secretary an
appropriate definitive measure, clearly referring to the Tariff Commission as the
entity that makes the positive determination. On the other hand, the penultimate
paragraph of the same provision states that [i]n the event of a negative final
determination, the DTI Secretary is to immediately issue through the Secretary of
Finance, a written instruction to the Commissioner of Customs authorizing the return
of the cash bonds previously collected as a provisional safeguard measure. Since the
first paragraph of the same provision states that it is the Tariff Commission which
makes the positive determination, it necessarily follows that it, and not the DTI
Secretary, makes the negative final determination as referred to in the penultimate
paragraph of Section 13.[60]
The Separate Opinion considers as highly persuasive of former Tariff
Commission Chairman Abon, who stated that the Commissions findings are merely
recommendatory.[61] Again, the considered opinion of Chairman Abon is of no
operative effect if the statute plainly states otherwise, and Section 5 bluntly does
require a positive final determination by the Tariff Commission before the DTI
Secretary may impose a general safeguard measure. [62]Certainly, the Court cannot
give controlling effect to the statements of any public officer in serious denial of his
duties if the law otherwise imposes the duty on the public office or officer.
Nonetheless, if we are to render persuasive effect on the considered opinion of
the members of the Executive Branch, it bears noting that the Secretary of the
Department of Justice rendered an Opinion wherein he concluded that the DTI
Secretary could not impose a general safeguard measure if the Tariff Commission
made a negative final determination.[63] Unlike Chairman Abons impromptu remarks
made during a hearing, the DOJ Opinion was rendered only after a thorough study of
the question after referral to it by the DTI. The DOJ Secretary is the alter ego of the
President with a stated mandate as the head of the principal law agency of the
[64]
government. As the DOJ Secretary has no denominated role in the SMA, he was
able to render his Opinion from the vantage of judicious distance. Should not his
Opinion, studied and direct to the point as it is, carry greater weight than the
spontaneous remarks of the Tariff Commissions Chairman which do not even
Preliminarily, we should note that none of the parties question the designation of
the DTI or Agriculture secretaries under the SMA as the imposing authorities of the
safeguard measures, even though Section 28(2) Article VI states that it is the
President to whom the power to impose tariffs and imposts may be delegated by
Congress. The validity of such designation under the SMA should not be in doubt. We
recognize that the authorization made by Congress in the SMA to the DTI and
Agriculture Secretaries was made in contemplation of their capacities as alter egos of
the President.
[66]
Indeed, in Marc Donnelly & Associates v. Agregado the Court upheld the
validity of a Cabinet resolution fixing the schedule of royalty rates on metal exports
and providing for their collection even though Congress, under Commonwealth Act
No. 728, had specifically empowered the President and not any other official of the
executive branch, to regulate and curtail the export of metals. In so ruling, the Court
held that the members of the Cabinet were acting as alter egos of the President. [67] In
this case, Congress itself authorized the DTI Secretary as alter ego of the President
to impose the safeguard measures. If the Court was previously willing to uphold the
alter egos tariff authority despite the absence of explicit legislative grant of such
authority on the alter ego, all the more reason now when Congress itself expressly
authorized the alter ego to exercise these powers to impose safeguard measures.
Notwithstanding, Congress in enacting the SMA and prescribing the roles to be
played therein by the Tariff Commission and the DTI Secretary did not envision that
the President, or his/her alter ego, could exercise supervisory powers over the Tariff
Commission. If truly Congress intended to allow the traditional alter ego principle to
come to fore in the peculiar setup established by the SMA, it would have assigned the
role now played by the DTI Secretary under the law instead to the NEDA. The Tariff
Commission is an attached agency of the National Economic Development
[68]
[69]
Authority, which in turn is the independent planning agency of the government.
The Tariff Commission does not fall under the administrative supervision of the
DTI.[70] On the other hand, the administrative relationship between the NEDA and the
Tariff Commission is established not only by the Administrative Code, but similarly
affirmed by the Tariff and Customs Code.
[71]
[77]
laws, the Tariff Commission is tasked, upon referral of the matter by the DTI, to
determine whether the factual conditions exist to warrant the imposition by the DTI of
a countervailing duty, an anti-dumping duty, or a general safeguard measure,
respectively. In all three laws, the determination by the Tariff Commission that these
required factual conditions exist is necessary before the DTI Secretary may impose
the corresponding duty or safeguard measure. And in all three laws, there is no
express provision authorizing the DTI Secretary to reverse the factual determination
of the Tariff Commission.[74]
Department of Agriculture. The same law establishes the Mines and Geo-Sciences
Bureau as one of the Sectoral Staff Bureaus[78] that forms part of the organizational
structure of the DENR.[79]
In fact, the SMA indubitably establishes that the Tariff Commission is no mere
flunky of the DTI Secretary when it mandates that the positive final recommendation
of the former be indispensable to the latters imposition of a general safeguard
measure. What the law indicates instead is a relationship of interdependence
between two bodies independent of each other under the Administrative Code and
the SMA alike. Indeed, even the ability of the DTI Secretary to disregard the Tariff
Commissions recommendations as to the particular safeguard measures to be
imposed evinces the independence from each other of these two bodies. This is
properly so for two reasons the DTI and the Tariff Commission are independent of
each other under the Administrative Code; and impropriety is avoided in cases
wherein the DTI itself is the one seeking the imposition of the general safeguard
measures, pursuant to Section 6 of the SMA.
Nonetheless, the Separate Opinion asserts that the SMA created a functional
relationship between the Tariff Commission and the DTI Secretary, sufficient to allow
the DTI Secretary to exercise alter ego powers to reverse the determination of the
Tariff Commission. Again, considering that the power to impose tariffs in the first
place is not inherent in the President but arises only from congressional grant, we
should affirm the congressional prerogative to impose limitations and restrictions on
such powers which do not normally belong to the executive in the first place. Nowhere
in the SMA does it state that the DTI Secretary may impose general safeguard
measures without a positive final determination by the Tariff Commission, or that the
DTI Secretary may reverse or even review the factual determination made by the
Tariff Commission.
As repeatedly stated, the Tariff Commission does not fall under the
administrative control of the DTI, but under the NEDA, pursuant to the Administrative
Code. The reliance made by the Separate Opinion to those three examples are thus
misplaced.
Congress in enacting the SMA and prescribing the roles to be played therein by
the Tariff Commission and the DTI Secretary did not envision that the President, or
his/her alter egocould exercise supervisory powers over the Tariff Commission. If
truly Congress intended to allow the traditional alter ego principle to come to fore in
the peculiar setup established by the SMA, it would have assigned the role now
played by the DTI Secretary under the law instead to the NEDA, the body to which the
Tariff Commission is attached under the Administrative Code.
The Court has no issue with upholding administrative control and supervision
exercised by the head of an executive department, but only over those subordinate
offices that are attached to the department, or which are, under statute, relegated
under its supervision and control. To declare that a department secretary, even if
acting as alter ego of the President, may exercise such control or supervision over all
executive offices below cabinet rank would lead to absurd results such as those
adverted to above. As applied to this case, there is no legal justification for the DTI
Secretary to exercise control, supervision, review or amendatory powers over the
Tariff Commission and its positive final determination. In passing, we note that there
is, admittedly, a feasible mode by which administrative review of the Tariff
Commissions final determination could be had, but it is not the procedure adopted by
respondents and now suggested for affirmation. This mode shall be discussed in a
forthcoming section.
The Separate Opinion asserts that the President, or his/her alter ego cannot be
made a mere rubber stamp of the Tariff Commission since Section 17, Article VII of
the Constitution denominates the Chief Executive exercises control over all executive
departments, bureaus and offices.[80] But let us be clear that such executive control
is not absolute. The definition of the structure of the executive branch of government,
and the corresponding degrees of administrative control and supervision, is not the
exclusive preserve of the executive. It may be effectively be limited by the
Constitution, by law, or by judicial decisions.
The Separate Opinion cites the respected constitutional law authority Fr.
Joaquin Bernas, in support of the proposition that such plenary power of executive
the law mandated that the decision be made on the sole discretion of an executive
officer, such as the DTI Secretary, it would be markedly easier for safeguard
measures to be imposed or withheld based solely on political considerations and not
on the factual conditions that are supposed to predicate the decision.
We see no reason to deviate from these observations, and indeed can add
similarly oriented comments. Corollary to the legislative power to decree policies
through legislation is the ability of the legislature to provide for means in the statute
itself to ensure that the said policy is strictly implemented by the body or office tasked
so tasked with the duty. As earlier stated, our treaty obligations dissuade the State for
now from implementing default protectionist trade measures such as tariffs, and allow
the same only under specified conditions.[90]The conditions enumerated under the
GATT Agreement on Safeguards for the application of safeguard measures by a
member country are the same as the requisites laid down in Section 5 of the
SMA.[91] To insulate the factual determination from political pressure, and to assure
that it be conducted by an entity especially qualified by reason of its general functions
to undertake such investigation, Congress deemed it necessary to delegate to the
Tariff Commission the function of ascertaining whether or not the those factual
conditions exist to warrant the atypical imposition of safeguard measures. After all,
the Tariff Commission retains a degree of relative independence by virtue of its
attachment to the National Economic Development Authority, an independent
planning agency of the government,[92] and also owing to its vaunted expertise and
specialization.
The matter of imposing a safeguard measure almost always involves not just
one industry, but the national interest as it encompasses other industries as well. Yet
in all candor, any decision to impose a safeguard measure is susceptible to all sorts
of external pressures, especially if the domestic industry concerned is well-organized.
Unwarranted impositions of safeguard measures may similarly be detrimental to the
national interest. Congress could not be blamed if it desired to insulate the
investigatory process by assigning it to a body with a putative degree of
independence and traditional expertise in ascertaining factual conditions. Affected
industries would have cause to lobby for or against the safeguard measures. The
decision-maker is in the unenviable position of having to bend an ear to listen to all
concerned voices, including those which may speak softly but carry a big stick. Had
At the same time, the statutory limitations on this authorized power of the DTI
Secretary must prevail since the Constitution itself demands the enforceability of
those limitations and restrictions as imposed by Congress. Policy wisdom will not
save a law from infirmity if the statutory provisions violate the Constitution. But since
the Constitution itself provides that the President shall be constrained by the limits
and restrictions imposed by Congress and since these limits and restrictions are so
clear and categorical, then the Court has no choice but to uphold the reins.
Even assuming that this prescribed setup made little sense, or seemed
uncommonly silly,[93] the Court is bound by propriety not to dispute the wisdom of the
legislature as long as its acts do not violate the Constitution. Since there is no
convincing demonstration that the SMA contravenes the Constitution, the Court is
wont to respect the administrative regimen propounded by the law, even if it allots the
Tariff Commission a higher degree of puissance than normally expected. It is for this
reason that the traditional conceptions of administrative review or quasi-judicial power
cannot control in this case.
Indeed, to apply the latter concept would cause the Court to fall into a linguistic
trap owing to the multi-faceted denotations the term quasi-judicial has come to
acquire.
Under the SMA, the Tariff Commission undertakes formal hearings, [94] receives
and evaluates testimony and evidence by interested parties, [95] and renders a
decision is rendered on the basis of the evidence presented, in the form of the final
determination. The final determination requires a conclusion whether the importation
of the product under consideration is causing serious injury or threat to a domestic
industry producing like products or directly competitive products, while evaluating all
relevant factors having a bearing on the situation of the domestic industry.[96] This
process aligns conformably with definition provided by Blacks Law Dictionary of
quasi-judicial as the action, discretion, etc., of public administrative officers or
bodies, who are required to investigate facts, or ascertain the existence of facts, hold
hearings, weigh evidence, and draw conclusions from them, as a basis for their
official action, and to exercise discretion of a judicial nature.[97]
However, the Tariff Commission is not empowered to hear actual cases or
controversies lodged directly before it by private parties. It does not have the power
to issue writs of injunction or enforcement of its determination. These considerations
militate against a finding of quasi-judicial powers attributable to the Tariff Commission,
considering the pronouncement that quasi-judicial adjudication would mean a
determination of rights privileges and duties resulting in a decision or order which
applies to a specific situation.[98]
Indeed, a declaration that the Tariff Commission possesses quasi-judicial
powers, even if ascertained for the limited purpose of exercising its functions under
the SMA, may have the unfortunate effect of expanding the Commissions powers
beyond that contemplated by law. After all, the Tariff Commission is by convention, a
fact-finding body, and its role under the SMA, burdened as it is with factual
determination, is but a mere continuance of this tradition. However, Congress through
the SMA offers a significant deviation from this traditional role by tying the decision by
the DTI Secretary to impose a safeguard measure to the required positive factual
determination by the Tariff Commission. Congress is not bound by past traditions, or
even by the jurisprudence of this Court, in enacting legislation it may deem as suited
for the times. The sole benchmark for judicial substitution of congressional wisdom is
constitutional transgression, a standard which the respondents do not even attempt to
match.
[100]
The Court has been emphatic that a positive final determination from the Tariff
Commission is required in order that the DTI Secretary may impose a general
safeguard measure, and that the DTI Secretary has no power to exercise control and
supervision over the Tariff Commission and its final determination. These conclusions
are the necessary consequences of the applicable provisions of the Constitution, the
SMA, and laws such as the Administrative Code. However, the law is silent though
on whether this positive final determination may otherwise be subjected to
administrative review.
There is no evident legislative intent by the authors of the SMA to provide for a
procedure of administrative review. If ever there is a procedure for administrative
review over the final determination of the Tariff Commission, such procedure must be
done in a manner that does not contravene or disregard legislative prerogatives as
expressed in the SMA or the Administrative Code, or fundamental constitutional
limitations.
In order that such procedure of administrative review would not contravene the
law and the constitutional scheme provided by Section 28(2), Article VI, it is essential
to assert that the positive final determination by the Tariff Commission is
indispensable as a requisite for the imposition of a general safeguard measure. The
submissions of private respondents and theSeparate Opinion cannot be sustained
insofar as they hold that the DTI Secretary can peremptorily ignore or disregard the
determinations made by the Tariff Commission. However, if the mode of
administrative review were in such a manner that the administrative superior of the
Tariff Commission were to modify or alter its determination, then such reversal may
still be valid within the confines of Section 5 of the SMA, for technically it is still the
Tariff Commissions determination, administratively revised as it may be, that would
serve as the basis for the DTI Secretarys action.
However, and fatally for the present petitions, such administrative review cannot
be conducted by the DTI Secretary. Even if conceding that the Tariff Commissions
findings may be administratively reviewed, the DTI Secretary has no authority to
review or modify the same. We have been emphatic on the reasons such as that
there is no traditional or statutory basis placing the Commission under the control and
supervision of the DTI; that to allow such would contravene due process, especially if
the DTI itself were to apply for the safeguard measuresmotu proprio. To hold
otherwise would destroy the administrative hierarchy, contravene constitutional due
process, and disregard the limitations or restrictions provided in the SMA.
Instead, assuming administrative review were available, it is the NEDA that may
conduct such review following the principles of administrative law, and the NEDAs
decision in turn is reviewable by the Office of the President. The decision of the Office
of the President then effectively substitutes as the determination of the Tariff
Commission, which now forms the basis of the DTI Secretarys decision, which now
would be ripe for judicial review by the CTA under Section 29 of the SMA. This is the
only way that administrative review of the Tariff Commissions determination may be
sustained without violating the SMA and its constitutional restrictions and limitations,
as well as administrative law.
In bare theory, the NEDA may review, alter or modify the Tariff Commissions
final determination, the Commission being an attached agency of the NEDA.
Admittedly, there is nothing in the SMA or any other statute that would prevent the
NEDA to exercise such administrative review, and successively, for the President to
exercise in turn review over the NEDAs decision.
Nonetheless, in acknowledging this possibility, the Court, without denigrating the
bare principle that administrative officers may exercise control and supervision over
the acts of the bodies under its jurisdiction, realizes that this comes at the expense of
a speedy resolution to an application for a safeguard measure, an application
dependent on fluctuating factual conditions. The further delay would foster uncertainty
and insecurity within the industry concerned, as well as with all other allied industries,
which in turn may lead to some measure of economic damage. Delay is certain, since
judicial review authorized by law and not administrative review would have the final
say. The fact that the SMA did not expressly prohibit administrative review of the final
determination of the Tariff Commission does not negate the supreme advantages of
engendering exclusive judicial review over questions arising from the imposition of a
general safeguard measure.
In any event, even if we conceded the possibility of administrative review of the
Tariff Commissions final determination by the NEDA, such would not deny merit to
the present petition. It does not change the fact that the Court of Appeals erred in
ruling that the DTI Secretary was not bound by the negative final determination of the
Tariff Commission, or that the DTI Secretary acted without jurisdiction when he
imposed general safeguard measures despite the absence of the statutory positive
final determination of the Commission.
In response to our citation of Section 28(2), Article VI, respondents elevate two
arguments grounded in constitutional law. One is based on another constitutional
provision, Section 12, Article XIII, which mandates that [t]he State shall promote the
preferential use of Filipino labor, domestic materials and locally produced goods and
adopt measures that help make them competitive. By no means does this provision
dictate that the Court favor the domestic industry in all competing claims that it may
bring before this Court. If it were so, judicial proceedings in this country would be
rendered a mockery, resolved as they would be, on the basis of the personalities of
the litigants and not their legal positions.
Moreover, the duty imposed on by Section 12, Article XIII falls primarily with
Congress, which in that regard enacted the SMA, a law designed to protect domestic
industries from the possible ill-effects of our accession to the global trade order.
Inconveniently perhaps for respondents, the SMA also happens to provide for a
procedure under which such protective measures may be enacted. The Court cannot
just impose what it deems as the spirit of the law without giving due regard to its
letter.
In like-minded manner, the Separate Opinion loosely states that the purpose of
the SMA is to protect or safeguard local industries from increased importation of
foreign products.[106]This inaccurately leaves the impression that the SMA ipso
facto unravels a protective cloak that shelters all local industries and producers, no
matter the conditions. Indeed, our country has knowingly chosen to accede to the
world trade regime, as expressed in the GATT and WTO Agreements, despite the
understanding that local industries might suffer ill-effects, especially with the easier
entry of competing foreign products. At the same time, these international agreements
were designed to constrict protectionist trade policies by its member-countries.
Hence, the median, as expressed by the SMA, does allow for the application of
protectionist measures such as tariffs, but only after an elaborate process of
investigation that ensures factual basis and indispensable need for such measures.
More accurately, the purpose of the SMA is to provide a process for the protection or
safeguarding of domestic industries that have duly established that there is
substantial injury or threat thereof directly caused by the increased imports. In short,
domestic industries are not entitled to safeguard measures as a matter of right or
influence.
Respondents also make the astounding argument that the imposition of general
safeguard measures should not be seen as a taxation measure, but instead as an
exercise of police power. The vain hope of respondents in divorcing the safeguard
measures from the concept of taxation is to exclude from consideration Section 28(2),
Article VI of the Constitution.
This argument can be debunked at length, but it deserves little attention. The
motivation behind many taxation measures is the implementation of police power
goals. Progressive income taxes alleviate the margin between rich and poor; the socalled sin taxes on alcohol and tobacco manufacturers help dissuade the consumers
from excessive intake of these potentially harmful products. Taxation is
distinguishable from police power as to the means employed to implement these
public good goals. Those doctrines that are unique to taxation arose from peculiar
considerations such as those especially punitive effects of taxation, [107] and the belief
that taxes are the lifeblood of the state. [108] These considerations necessitated the
evolution of taxation as a distinct legal concept from police power. Yet at the same
time, it has been recognized that taxation may be made the implement of the states
[109]
police power.
Even assuming that the SMA should be construed exclusively as a police power
measure, the Court recognizes that police power is lodged primarily in the national
legislature, though it may also be exercised by the executive branch by virtue of a
[110]
valid delegation of legislative power.
Considering these premises, it is clear that
police power, however illimitable in theory, is still exercised within the confines of
implementing legislation. To declare otherwise is to sanction rule by whim instead of
rule of law. The Congress, in enacting the SMA, has delegated the power to impose
general safeguard measures to the executive branch, but at the same time subjected
such imposition to limitations, such as the requirement of a positive final
determination by the Tariff Commission under Section 5. For the executive branch to
ignore these boundaries imposed by Congress is to set up an ignoble clash between
the two co-equal branches of government. Considering that the exercise of police
power emanates from legislative authority, there is little question that the prerogative
of the legislative branch shall prevail in such a clash.
Public respondents allege that the Decision is contrary to our holding in Taada
[111]
v. Angara,
since the Court noted therein that the GATT itself provides built-in
protection from unfair foreign competition and trade practices, which according to the
public respondents, was a reason why the Honorable [Court] ruled the way it did. On
the other hand, the Decisioneliminates safeguard measures as a mode of defense.
This is balderdash, as with any and all claims that the Decision allows foreign
industries to ride roughshod over our domestic enterprises. The Decision does not
prohibit the imposition of general safeguard measures to protect domestic industries
in need of protection. All it affirms is that the positive final determination of the Tariff
Commission is first required before the general safeguard measures are imposed and
implemented, a neutral proposition that gives no regard to the nationalities of the
parties involved. A positive determination by the Tariff Commission is hardly the
elusive Shangri-la of administrative law. If a particular industry finds it difficult to
obtain a positive final determination from the Tariff Commission, it may be simply
because the industry is still sufficiently competitive even in the face of foreign
competition. These safeguard measures are designed to ensure salvation, not
avarice.
Respondents well have the right to drape themselves in the colors of the
flag. Yet these postures hardly advance legal claims, or nationalism for that matter.
The fineries of the costume pageant are no better measure of patriotism than simple
obedience to the laws of the Fatherland. And even assuming that respondents are
motivated by genuine patriotic impulses, it must be remembered that under the setup
provided by the SMA, it is the facts, and not impulse, that determine whether the
protective safeguard measures should be imposed. As once orated, facts are
stubborn things; and whatever may be our wishes, our inclinations, or the dictates of
our passions, they cannot alter the state of facts and evidence. [112]
It is our goal as judges to enforce the law, and not what we might deem as
correct economic policy. Towards this end, we should not construe the SMA to
unduly favor or disfavor domestic industries, simply because the law itself provides for
a mechanism by virtue of which the claims of these industries are thoroughly
evaluated before they are favored or disfavored. What we must do is to simply uphold
what the law says. Section 5 says that the DTI Secretary shall impose the general
safeguard measures upon the positive final determination of the Tariff Commission.
Nothing in the whereas clauses or the invisible ink provisions of the SMA can
magically delete the words positive final determination and Tariff Commission from
Section 5.
VI. On Forum-Shopping
the undertaking signed by the President of Southern Cross, Hironobu Ryu, to inform
this Court of any similar action or proceeding pending before any court, tribunal or
agency within five (5) days from knowledge thereof, Southern Cross informed this
Court only on 12 August 2003 of the petition it had filed with the CTA eleven days
earlier. An appropriate sanction is warranted for such failure, but not the dismissal of
the petition.
Respondent DTI Secretary is hereby ENJOINED from taking any further action
on the pending Petition for Extension of the Safeguard Measure.
Hironobu Ryu, President of petitioner Southern Cross Cement Corporation, and
Angara Abello Concepcion Regala & Cruz, counsel petitioner, are hereby given FIVE
(5) days from receipt of this Resolution to EXPLAIN why they should not be meted
disciplinary sanction for failing to timely inform the Court of the filing of Southern
Crosss Petition for Review with the Court of Tax Appeals, as adverted to earlier in
this Resolution.
SO ORDERED.
Puno, Quisumbing, Austria-Martinez, Callejo, Sr., Azcuna, ChicoNazario, and Garcia, JJ., concur.
Davide, Jr., C.J., Ynares-Santiago, Sandoval-Gutierrez, and Carpio-Morales,
JJ., joins J. Panganiban in his Separate Opinion.
Panganiban, J., see separate opinion.
Carpio, J., no part.
Corona, J., on official leave.
The Court of Appeals Decision was annulled precisely because the appellate
court did not have the power to rule on the petition in the first place. Jurisdiction is
necessarily the power to decide a case, and a court which does not have the power to
adjudicate a case is one that is bereft of jurisdiction. We find no reason to disturb our
earlier finding that the Court of Appeals Decision is null and void.
At the same time, the Court in its Decision paid particular heed to the
peculiarities attaching to the 5 August 2003 Decision of the DTI Secretary. In the DTI
Secretarys Decision, he expressly stated that as a result of the Court of
Appeals Decision, there is no legal impediment for the Secretary to decide on the
application. Yet the truth remained that there was a legal impediment, namely, that
the decision of the appellate court was not yet final and executory. Moreover, it was
declared null and void, and since the DTI Secretary expressly denominated the Court
of Appeals Decision as his basis for deciding to impose the safeguard measures, the
latter decision must be voided as well. Otherwise put, without the Court of
AppealsDecision, the DTI Secretarys Decision of 5 August 2003 would not have
been rendered as well.
Accordingly, the Court reaffirms as a nullity the DTI Secretarys Decision dated 5
August 2003. As a necessary consequence, no further action can be taken on
Philcemcors Petition for Extension of the Safeguard Measure. Obviously, if the
imposition of the general safeguard measure is void as we declared it to be, any
extension thereof should likewise be fruitless. The proper remedy instead is to file a
new application for the imposition of safeguard measures, subject to the conditions
prescribed by the SMA. Should this step be eventually availed of, it is only hoped that
the parties involved would content themselves in observing the proper procedure,
instead of making a mockery of the rule of law.
WHEREFORE, respondents Motions for Reconsideration are DENIED WITH
FINALITY.
EN BANC
The factual antecedents derive from the promulgation of our ruling in Pelaez v.
Auditor General[2] in 1965. As discussed therein, then President Diosdado Macapagal
issued several Executive Orders[3] creating thirty-three (33) municipalities in
Mindanao. Among them was Andong in Lanao del Sur which was created by virtue of
[4]
Executive Order No. 107.
These executive orders were issued after legislative bills for the creation of
municipalities involved in that case had failed to pass Congress. [5] President
Diosdado Macapagal justified the creation of these municipalities citing his powers
under Section 68 of the Revised Administrative Code. Then Vice-President
Emmanuel Pelaez filed a special civil action for a writ of prohibition, alleging in main
that the Executive Orders were null and void, Section 68 having been repealed by
Republic Act No. 2370,[6] and said orders constituting an undue delegation of
[7]
legislative power.
After due deliberation, the Court unanimously held that the challenged Executive
Orders were null and void. A majority of five justices, led by the ponente, Justice (later
Chief Justice) Roberto Concepcion, ruled that Section 68 of the Revised
Administrative Code did not meet the well-settled requirements for a valid delegation
of legislative power to the executive branch, [8] while three justices opined that the
nullity of the issuances was the consequence of the enactment of the 1935
Constitution, which reduced the power of the Chief Executive over local
governments.[9] Pelaez was disposed in this wise:
WHEREFORE, the Executive Orders in question are declared null and void ab initio and the
respondent permanently restrained from passing in audit any expenditure of public funds in
implementation of said Executive Orders or any disbursement by the municipalities above
referred to. It is so ordered. [10]
Among the Executive Orders annulled was Executive Order No. 107 which
created the Municipality of Andong. Nevertheless, the core issue presented in the
present petition is the continued efficacy of the judicial annulment of the Municipality
of Andong.
Petitioner Sultan Osop B. Camid (Camid) represents himself as a current
[11]
resident of Andong, suing as a private citizen and taxpayer whose locus standi is
of public and paramount interest especially to the people of the Municipality of
[12]
Andong, Province of Lanao del Sur. He alleges that Andong has metamorphosed
into a full-blown municipality with a complete set of officials appointed to handle
essential services for the municipality and its constituents, [13] even though he
concedes that since 1968, no person has been appointed, elected or qualified to
[14]
serve any of the elective local government positions of Andong. Nonetheless, the
municipality of Andong has its own high school, Bureau of Posts, a Department of
Education, Culture and Sports office, and at least seventeen (17) barangay units
with their own respective chairmen.[15] From 1964 until 1972, according to Camid, the
public officials of Andong have been serving their constituents through the minimal
means and resources with least (sic) honorarium and recognition from the Office of
the then former President Diosdado Macapagal. Since the time of Martial Law in
1972, Andong has allegedly been getting by despite the absence of public funds, with
[16]
the Interim Officials serving their constituents in their own little ways and means.
In support of his claim that Andong remains in existence, Camid presents to this
Court a Certification issued by the Office of the Community Environment and Natural
Resources (CENRO) of the Department of Environment and Natural Resources
(DENR) certifying the total land area of the Municipality of Andong, created under
[17]
Executive Order No. 107 issued [last] October 1, 1964. He also submits
a Certification issued by the Provincial Statistics Office of Marawi City concerning the
population of Andong, which is pegged at fourteen thousand fifty nine (14,059) strong.
Camid also enumerates a list of governmental agencies and private groups that
allegedly recognize Andong, and notes that other municipalities have recommended
to the Speaker of the Regional Legislative Assembly for the immediate
implementation of the revival or re-establishment of Andong.[18]
The petition assails a Certification dated 21 November 2003, issued by the
Bureau of Local Government Supervision of the Department of Interior and Local
Government (DILG).[19] TheCertification enumerates eighteen (18) municipalities
certified as existing, per DILG records. Notably, these eighteen (18) municipalities
are among the thirty-three (33), along with Andong, whose creations were voided by
this Court in Pelaez. These municipalities are Midaslip, Pitogo, Naga, and Bayog in
Zamboanga del Sur; Siayan and Pres. Manuel A. Roxas in Zamboanga del Norte;
Magsaysay, Sta. Maria and New Corella in Davao; Badiangan and Mina in Iloilo;
Maguing in Lanao del Sur; Gloria in Oriental Mindoro; Maasim in Sarangani;
Kalilangan and Lantapan in Bukidnon; and Maco in Compostela Valley.[20]
Camid imputes grave abuse of discretion on the part of the DILG in not
classifying [Andong] as a regular existing municipality and in not including said
municipality in its records and official database as [an] existing regular
municipality.[21] He characterizes such non-classification as unequal treatment to the
detriment of Andong, especially in light of the current recognition given to the eighteen
(18) municipalities similarly annulled by reason of Pelaez. As appropriate relief,
Camid prays that the Court annul the DILG Certification dated 21 November 2003;
direct the DILG to classify Andong as a regular existing municipality; all public
respondents, to extend full recognition and support to Andong; the Department of
Finance and the Department of Budget and Management, to immediately release the
internal revenue allotments of Andong; and the public respondents, particularly the
DILG, to recognize the Interim Local Officials of Andong. [22]
Moreover, Camid insists on the continuing validity of Executive Order No. 107.
He argues that Pelaez has already been modified by supervening events consisting of
subsequent laws and jurisprudence. Particularly cited is our Decision in Municipality
of San Narciso v. Hon. Mendez,[23] wherein the Court affirmed the unique status of the
[24]
municipality of San Andres in Quezon as a de facto municipal corporation. Similar
to Andong, the municipality of San Andres was created by way of executive order,
precisely the manner which the Court in Pelaez had declared as unconstitutional.
Moreover, San Narciso cited, as Camid does, Section 442(d) of the Local
Government Code of 1991 as basis for the current recognition of the impugned
municipality. The provision reads:
Section 442. Requisites for Creation. - xxx
(d) Municipalities existing as of the date of the effectivity of this Code shall continue to exist
and operate as such. Existing municipal districts organized pursuant to presidential issuances
or executive orders and which have their respective sets of elective municipal officials holding
office at the time of the effectivity of (the) Code shall henceforth be considered as regular
municipalities.[25]
There are several reasons why the petition must be dismissed. These can be
better discerned upon examination of the proper scope and application of Section
442(d), which does not sanction the recognition of just any municipality. This point
shall be further explained further on.
Notably, as pointed out by the public respondents, through the Office of the
Solicitor General (OSG), the case is not a fit subject for the special civil actions of
certiorari and mandamus, as it pertains to the de novo appreciation of factual
questions. There is indeed no way to confirm several of Camids astonishing factual
allegations pertaining to the purported continuing operation of Andong in the decades
since it was annulled by this Court. No trial court has had the opportunity to ascertain
the validity of these factual claims, the appreciation of which is beyond the function of
this Court since it is not a trier of facts.
The importance of proper factual ascertainment cannot be gainsaid, especially
in light of the legal principles governing the recognition of de facto municipal
corporations. It has been opined that municipal corporations may exist by prescription
where it is shown that the community has claimed and exercised corporate functions,
with the knowledge and acquiescence of the legislature, and without interruption or
objection for period long enough to afford title by prescription. [26] These municipal
corporations have exercised their powers for a long period without objection on the
part of the government that although no charter is in existence, it is presumed that
they were duly incorporated in the first place and that their charters had been
lost.[27] They are especially common in England, which, as well-worth noting, has
existed as a state for over a thousand years. The reason for the development of that
rule in England is understandable, since that country was settled long before the
Roman conquest by nomadic Celtic tribes, which could have hardly been expected to
obtain a municipal charter in the absence of a national legal authority.
This ratiocination does not admit to patent legal errors and has the
virtue of blessed austerity. Still, its sweeping adoption may not be
appropriate in light of Section 442(d) of the Local Government Code and
in Municipality of San Narciso, both of which admit to the
of de facto municipal corporations.
It is also difficult to capture the sense and viability of Camids present action.
The assailed issuance is the Certification issued by the DILG. But
such Certification does not pretend to bear the authority to create or revalidate a
municipality. Certainly, the annulment of the Certification will really do nothing to
additional
advisedly
our ruling
possibility
The eminent legal doctrine enunciated in Pelaez was that the President was
then, and still is, not empowered to create municipalities through executive issuances.
The Court therein recognized that the President has, for many years, issued
executive orders creating municipal corporations, and that the same have been
organized and in actual operation . . . .[36]However, the Court ultimately nullified only
those thirty-three (33) municipalities, including Andong, created during the period from
4 September to 29 October 1964 whose existence petitioner Vice-President Pelaez
had specifically assailed before this Court. No pronouncement was made as to the
other municipalities which had been previously created by the President in the
exercise of power the Court deemed unlawful.
Two years after Pelaez was decided, the issue again came to fore
in Municipality of San Joaquin v. Siva.[37] The Municipality of Lawigan was created by
virtue of Executive Order No. 436 in 1961. Lawigan was not one of the municipalities
ordered annulled in Pelaez. A petition for prohibition was filed contesting the legality
of the executive order, again on the ground that Section 68 of the Revised
Administrative Code was unconstitutional. The trial court dismissed the petition, but
the Supreme Court reversed the ruling and entered a new decision declaring
Executive Order No. 436 void ab initio. The Court reasoned without elaboration that
the issue had already been squarely taken up and settled in Pelaez which agreed with
the argument posed by the challengers to Lawigans validity.[38]
In the 1969 case of Municipality of Malabang v. Benito,[39] what was challenged
is the validity of the constitution of the Municipality of Balabagan in Lanao del Sur,
[40]
also created by an executive order, and which, similar to Lawigan, was not one of
the municipalities annulled in Pelaez. This time, the officials of Balabagan invoked de
facto status as a municipal corporation in order to dissuade the Court from nullifying
action. They alleged that its status as a de facto corporation cannot be collaterally
attacked but should be inquired into directly in an action for quo warranto at the
instance of the State, and not by a private individual as it was in that case. In
response, the Court conceded that an inquiry into the legal existence of a municipality
is reserved to the State in a proceeding for quo warranto, but only if the municipal
corporation is a de facto corporation.[41]
Ultimately, the Court refused to acknowledge Balabagan as a de
facto corporation, even though it had been organized prior to the Courts decision
in Pelaez. The Court declared void the executive order creating Balabagan and
restrained its municipal officials from performing their official duties and
functions.[42] It cited conflicting American authorities on whether a de
facto corporation can exist where the statute or charter creating it is
unconstitutional.[43] But the Courts final conclusion was unequivocal that Balabagan
was not a de facto corporation.
In the cases where a de facto municipal corporation was recognized as such despite the fact
that the statute creating it was later invalidated, the decisions could fairly be made to rest on
the consideration that there was some other valid law giving corporate vitality to the
organization. Hence, in the case at bar, the mere fact that Balabagan was organized at a time
when the statute had not been invalidated cannot conceivably make it a de facto corporation,
as, independently of the Administrative Code provision in question, there is no other valid
statute to give color of authority to its creation. [44]
The Court did clarify in Malabang that the previous acts done by the municipality
[45]
in the exercise of its corporate powers were not necessarily a nullity. Camid
devotes several pages of his petition in citing this point,[46] yet the relevance of the
citation is unclear considering that Camid does not assert the validity of any corporate
act of Andong prior to its judicial dissolution. Notwithstanding, the Court
in Malabang retained an emphatic attitude as to the unconstitutionality of the power of
the President to create municipal corporations by way of presidential promulgations,
as authorized under Section 68 of the Revised Administrative Code.
This principle was most recently affirmed in 1988, in Municipality of Kapalong v.
Moya.[47] The municipality of Santo Tomas, created by President Carlos P. Garcia,
filed a complaint against another municipality, who challenged Santo Tomass legal
personality to institute suit. Again, Santo Tomas had not been expressly nullified by
prior judicial action, yet the Court refused to recognize its legal existence. The blunt
but simple ruling: Now then, as ruled in the Pelaez case supra, the President has no
power to create a municipality. Since [Santo Tomas] has no legal personality, it can
[48]
not be a party to any civil action.
Nevertheless, when the Court decided Municipality of San Narciso[49] in 1995, it
indicated a shift in the jurisprudential treatment of municipalities created through
presidential issuances. The questioned municipality of San Andres, Quezon was
created on 20 August 1959 by Executive Order No. 353 issued by President Carlos P.
Garcia. Executive Order No. 353 was not one of the thirty-three issuances annulled
by Pelaez in 1965. The legal status of the Municipality of San Andres was first
challenged only in 1989, through a petition for quo warranto filed with the Regional
[50]
Trial Court of Gumaca, Quezon, which did cite Pelaez as authority. The RTC
dismissed the petition for lack of cause of action, and the petitioners therein elevated
the matter to this Court.
In dismissing the petition, the Court delved in the merits of the petition, if only to
resolve further doubt on the legal status of San Andres. It noted a circumstance which
is not present in the case at barthat San Andres was in existence for nearly thirty
(30) years before its legality was challenged. The Court did not declare the executive
order creating San Andres null and void. Still, acting on the premise that the said
executive order was a complete nullity, the Court noted peculiar circumstances that
led to the conclusion that San Andres had attained the unique status of a de facto
municipal corporation.[51] It noted that Pelaez limited its nullificatory effect only to
those executive orders specifically challenged therein, despite the fact that the Court
then could have very well extended the decision to invalidate San Andres as
well.[52] This statement squarely contradicts Camids reading of San Narciso that the
creation of San Andres, just like Andong, had been declared a complete nullity on the
same ground of unconstitutional delegation of legislative power found in Pelaez.[53]
The Court also considered the applicability of Section 442(d) [54] of the Local
Government Code of 1991. It clarified the implication of the provision as follows:
Equally significant is Section 442(d) of the Local Government Code to the effect that
municipal districts "organized pursuant to presidential issuances or executive orders and which
have their respective sets of elective municipal officials holding office at the time of the
effectivity of (the) Code shall henceforth be considered as regular municipalities." No
pretension of unconstitutionality per se of Section 442(d) of the Local Government Code is
preferred. It is doubtful whether such a pretext, even if made, would succeed. The power to
create political subdivisions is a function of the legislature. Congress did just that when it
has incorporated Section 442(d) in the Code. Curative laws, which in essence are
retrospective, and aimed at giving "validity to acts done that would have been invalid under
existing laws, as if existing laws have been complied with," are validly accepted in this
jurisdiction, subject to the usual qualification against impairment of vested rights. (Emphasis
supplied)[55]
The holding in San Narciso was subsequently affirmed in Municipality of
Candijay v. Court of Appeals[56] and Municipality of Jimenez v. Baz[57] In Candijay, the
juridical personality of the Municipality of Alicia, created in a 1949 executive order,
was attacked only beginning in 1984. Pelaez was again invoked in support of the
challenge, but the Court refused to invalidate the municipality, citing San Narciso at
length. The Court noted that the situation of the Municipality of Alicia was strikingly
similar to that in San Narciso; hence, the town should likewise benefit from the
effects of Section 442(d) of the Local Government Code, and should [be] considered
[58]
as a regular, de jure municipality.
The valid existence of Municipality of Sinacaban, created in a 1949 executive
order, was among the issues raised in Jimenez. The Court, through Justice Mendoza,
provided an expert summation of the evolution of the rule.
The principal basis for the view that Sinacaban was not validly created as a municipal
corporation is the ruling in Pelaez v. Auditor General that the creation of municipal
corporations is essentially a legislative matter and therefore the President was without power
to create by executive order the Municipality of Sinacaban. The ruling in this case has been
reiterated in a number of cases later decided. However, we have since held that where a
municipality created as such by executive order is later impliedly recognized and its acts are
accorded legal validity, its creation can no longer be questioned. InMunicipality of San
Narciso, Quezon v. Mendez, Sr., this Court considered the following factors as having
validated the creation of a municipal corporation, which, like the Municipality of Sinacaban,
was created by executive order of the President before the ruling in Pelaez v. Auditor General:
(1) the fact that for nearly 30 years the validity of the creation of the municipality had never
been challenged; (2) the fact that following the ruling in Pelaez no quo warranto suit was filed
to question the validity of the executive order creating such municipality; and (3) the fact that
the municipality was later classified as a fifth class municipality, organized as part of a
municipal circuit court and considered part of a legislative district in the Constitution
apportioning the seats in the House of Representatives. Above all, it was held that whatever
doubt there might be as to the de jure character of the municipality must be deemed to have
been put to rest by the Local Government Code of 1991 (R. A. No. 7160), 442(d) of which
provides that "municipal districts organized pursuant to presidential issuances or executive
orders and which have their respective sets of elective officials holding office at the time of
the effectivity of this Code shall henceforth be considered as regular municipalities."
Here, the same factors are present so as to confer on Sinacaban the status of at least a de facto
municipal corporation in the sense that its legal existence has been recognized and acquiesced
publicly and officially. Sinacaban had been in existence for sixteen years when Pelaez v.
Auditor General was decided on December 24, 1965. Yet the validity of E.O. No. 258 creating
it had never been questioned. Created in 1949, it was only 40 years later that its existence was
questioned and only because it had laid claim to an area that apparently is desired for its
revenue. This fact must be underscored because under Rule 66, 16 of the Rules of Court,
a quo warranto suit against a corporation for forfeiture of its charter must be commenced
within five (5) years from the time the act complained of was done or committed. On the
contrary, the State and even the Municipality of Jimenez itself have recognized Sinacaban's
corporate existence. Under Administrative Order No. 33 dated June 13, 1978 of this Court, as
reiterated by 31 of the Judiciary Reorganization Act of 1980 (B. P. Blg. 129), Sinacaban is
constituted part of a municipal circuit for purposes of the establishment of Municipal Circuit
Trial Courts in the country. For its part, Jimenez had earlier recognized Sinacaban in 1950 by
entering into an agreement with it regarding their common boundary. The agreement was
embodied in Resolution No. 77 of the Provincial Board of Misamis Occidental.
Indeed Sinacaban has attained de jure status by virtue of the Ordinance appended to the 1987
Constitution, apportioning legislative districts throughout the country, which considered
Sinacaban part of the Second District of Misamis Occidental. Moreover, following the ruling
in Municipality of San Narciso, Quezon v. Mendez, Sr., 442(d) of the Local Government Code
of 1991 must be deemed to have cured any defect in the creation of Sinacaban. [59]
From this survey of relevant jurisprudence, we can gather the applicable
rules. Pelaez and its offspring cases ruled that the President has no power to create
municipalities, yet limited its nullificatory effects to the particular municipalities
challenged in actual cases before this Court. However, with the promulgation of the
Local Government Code in 1991, the legal cloud was lifted over the municipalities
similarly created by executive order but not judicially annulled. The de facto status of
such municipalities as San Andres, Alicia and Sinacaban was recognized by this
Court, and Section 442(b) of the Local Government Code deemed curative whatever
legal defects to title these municipalities had labored under.
Is Andong similarly entitled to recognition as a de facto municipal corporation? It
is not. There are eminent differences between Andong and municipalities such as
San Andres, Alicia and Sinacaban. Most prominent is the fact that the executive order
creating Andong was expressly annulled by order of this Court in 1965. If we were to
affirm Andongs de facto status by reason of its alleged continued existence despite
its nullification, we would in effect be condoning defiance of a valid order of this Court.
Court decisions cannot obviously lose their efficacy due to the sheer defiance by the
parties aggrieved.
It bears noting that based on Camids own admissions, Andong does not meet
the requisites set forth by Section 442(d) of the Local Government Code. Section
442(d) requires that in order that the municipality created by executive order may
receive recognition, they must have their respective set of elective municipal officials
holding office at the time of the effectivity of [the Local Government] Code. Camid
admits that Andong has never elected its municipal officers at all. [60] This incapacity
ties in with the fact that Andong was judicially annulled in 1965. Out of obeisance to
our ruling in Pelaez, the national government ceased to recognize the existence of
Andong, depriving it of its share of the public funds, and refusing to conduct municipal
elections for the void municipality.
The failure to appropriate funds for Andong and the absence of elections in the
municipality in the last four decades are eloquent indicia of the non-recognition by the
State of the existence of the town. The certifications relied upon by Camid, issued by
the DENR-CENRO and the National Statistics Office, can hardly serve the purpose of
attesting to Andongs legal efficacy. In fact, both these certifications qualify that they
were issued upon the request of Camid, to support the restoration or re-operation of
the Municipality of Andong, Lanao del Sur,[61]thus obviously conceding that the
municipality is at present inoperative.
We may likewise pay attention to the Ordinance appended to the 1987
Constitution, which had also been relied upon in Jimenez and San Narciso. This
Ordinance, which apportioned the seats of the House of Representatives to the
different legislative districts in the Philippines, enumerates the various municipalities
that are encompassed by the various legislative districts. Andong is not listed therein
as among the municipalities of Lanao del Sur, or of any other province for that
[62]
matter. On the other hand, the municipalities of San Andres, Alicia and Sinacaban
are mentioned in the Ordinance as part of Quezon, [63] Bohol,[64] and Misamis
[65]
Occidental respectively.
How about the eighteen (18) municipalities similarly nullified in Pelaez but
certified as existing in the DILG Certification presented by Camid? The petition fails
to mention that subsequent to the ruling in Pelaez, legislation was enacted to
[66]
reconstitute these municipalities.
It is thus not surprising that the DILG certified the
existence of these eighteen (18) municipalities, or that these towns are among the
municipalities enumerated in the Ordinance appended to the Constitution. Andong
has not been similarly reestablished through statute. Clearly then, the fact that there
are valid organic statutes passed by legislation recreating these eighteen (18)
municipalities is sufficient legal basis to accord a different legal treatment to Andong
as against these eighteen (18) other municipalities.
We thus assert the proper purview to Section 442(d) of the Local Government
Codethat it does not serve to affirm or reconstitute the judicially dissolved
municipalities such as Andong, which had been previously created by presidential
issuances or executive orders. The provision affirms the legal personalities only of
those municipalities such as San Narciso, Alicia, and Sinacaban, which may have
been created using the same infirm legal basis, yet were fortunate enough not to have
been judicially annulled. On the other hand, the municipalities judicially dissolved in
cases such as Pelaez, San Joaquin, and Malabang, remain inexistent, unless
recreated through specific legislative enactments, as done with the eighteen (18)
municipalities certified by the DILG. Those municipalities derive their legal personality
not from the presidential issuances or executive orders which originally created them
or from Section 442(d), but from the respective legislative statutes which were
enacted to revive them.
EN BANC
BAI SANDRA S. A. SEMA,
Petitioner,
- versus -
COMMISSION ON ELECTIONS
and DIDAGEN P. DILANGALEN,
Respondents.
x------------------------x
PERFECTO F. MARQUEZ,
Petitioner,
And what now of Andong and its residents? Certainly, neither Pelaez or this
decision has obliterated Andong into a hole on the ground. The legal effect of the
nullification of Andong inPelaez was to revert the constituent barrios of the voided
town back into their original municipalities, namely the municipalities of Lumbatan,
Butig and Tubaran.[67] These three municipalities subsist to this day as part of Lanao
del Sur,[68] and presumably continue to exercise corporate powers over the barrios
which once belonged to Andong.
If there is truly a strong impulse calling for the reconstitution of Andong, the
solution is through the legislature and not judicial confirmation of void title. If indeed
the residents of Andong have, all these years, been governed not by their proper
municipal governments but by a ragtag Interim Government, then an expedient
political and legislative solution is perhaps necessary. Yet we can hardly sanction the
retention of Andongs legal personality solely on the basis of collective amnesia that
may have allowed Andong to somehow pretend itself into existence despite its judicial
dissolution. Maybe those who insist Andong still exists prefer to remain unperturbed in
their blissful ignorance, like the inhabitants of the cave in Platos famed allegory. But
the time has come for the light to seep in, and for the petitioner and like-minded
persons to awaken to legal reality.
- versus -
PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
AZCUNA,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
REYES,
LEONARDO-DE
CASTRO, and
BRION, JJ.
COMMISSION ON ELECTIONS,
Respondent.
Promulgated:
July 16, 2008
x--------------------------------------------------x
SO ORDERED.
Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-Santiago, SandovalGutierrez, Carpio, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr., Azcuna,
Chico-Nazario andGarcia, JJ., concur.
DECISION
CARPIO, J.:
The Case
These consolidated petitions[1] seek to annul Resolution No. 7902, dated 10 May 2007,
of the Commission on Elections (COMELEC) treating Cotabato City as part of the legislative
district of the Province of Shariff Kabunsuan. [2]
The Facts
The Ordinance appended to the 1987 Constitution apportioned two legislative districts
for the Province of Maguindanao. The first legislative district consists of CotabatoCity and
eight municipalities.[3] Maguindanao forms part of the Autonomous Region in Muslim
Mindanao (ARMM), created under its Organic Act, Republic Act No. 6734 (RA 6734), as
amended by Republic Act No. 9054 (RA 9054).[4] Although under the
Ordinance, Cotabato City forms part of Maguindanaos first legislative district, it is not part of
the ARMM but of Region XII, having voted against its inclusion in the ARMM in the
plebiscite held in November 1989.
On 28 August 2006, the ARMMs legislature, the ARMM Regional Assembly,
exercising its power to create provinces under Section 19, Article VI of RA 9054, [5]enacted
Muslim Mindanao Autonomy Act No. 201 (MMA Act 201) creating the Province of Shariff
Kabunsuan composed of the eight municipalities in the first district of Maguindanao. MMA
Act 201 provides:
Section 1. The Municipalities of Barira, Buldon, Datu Odin Sinsuat,
Kabuntalan, Matanog, Parang, Sultan Kudarat, Sultan Mastura, and Upi
are hereby separated from the Province ofMaguindanao and constituted
into a distinct and independent province, which is hereby created, to be
known as the Province of Shariff Kabunsuan.
time of the approval of this Act until the new readjustment of salaries in
accordance with law. Provided, furthermore, that there shall be no
diminution in the number of the members of the Sangguniang
Panlalawigan of the mother province.
Except as may be provided by national law, the existing legislative
district, which includes Cotabato as a part thereof, shall remain.
Later, three new municipalities [6] were carved out of the original nine municipalities
constituting Shariff Kabunsuan, bringing its total number of municipalities to 11. Thus, what
was left of Maguindanao were the municipalities constituting its second legislative
district. Cotabato City, although part of Maguindanaos first legislative district, is not part of
the Province of Maguindanao.
The voters of Maguindanao ratified Shariff Kabunsuans creation in a plebiscite held
on 29 October 2006.
On 6 February 2007, the Sangguniang Panlungsod of Cotabato City passed
Resolution No. 3999 requesting the COMELEC to clarify the status of Cotabato City in view
of the conversion of the First District of Maguindanao into a regular province under MMA
Act 201.
In answer to Cotabato Citys query, the COMELEC issued Resolution No. 07-0407 on 6
March 2007 "maintaining the status quo with Cotabato City as part of Shariff Kabunsuan in
the First Legislative District of Maguindanao. Resolution No. 07-0407, which adopted the
recommendation of the COMELECs Law Department under a Memorandum dated 27
February 2007,[7] provides in pertinent parts:
Considering the foregoing, the Commission RESOLVED, as it
hereby resolves, to adopt the recommendation of the Law Department
that pending the enactment of the appropriate law by Congress, to
maintain the status quo with Cotabato City as part of Shariff Kabunsuan in
the First Legislative District of Maguindanao. (Emphasis supplied)
xxxx
Sec. 5. The corporate existence of this province shall commence
upon the appointment by the Regional Governor or election of the
governor and majority of the regular members of the Sangguniang
Panlalawigan.
The incumbent elective provincial officials of the Province of
Maguindanao shall continue to serve their unexpired terms in the province
that they will choose or where they are residents: Provided, that where an
elective position in both provinces becomes vacant as a consequence of
the creation of the Province of Shariff Kabunsuan, all incumbent elective
provincial officials shall have preference for appointment to a higher
elective vacant position and for the time being be appointed by the
Regional Governor, and shall hold office until their successors shall have
been elected and qualified in the next local elections; Provided, further,
that they shall continue to receive the salaries they are receiving at the
acted without or in excess of its jurisdiction in issuing Resolution No. 7902 which maintained
the status quo in Maguindanaos first legislative district despite the COMELECs earlier
directive in Resolution No. 7845 designating Cotabato City as the lone component of
Maguindanaos reapportioned first legislative district. [12] Sema further claimed that in issuing
Resolution No. 7902, the COMELEC usurped Congress power to create or reapportion
legislative districts.
In its Comment, the COMELEC, through the Office of the Solicitor General (OSG),
chose not to reach the merits of the case and merely contended that (1) Sema wrongly availed
of the writ of certiorari to nullify COMELEC Resolution No. 7902 because the COMELEC
issued the same in the exercise of its administrative, not quasi-judicial, power and (2) Semas
prayer for the writ of prohibition in G.R. No. 177597 became moot with the proclamation of
respondent Didagen P. Dilangalen (respondent Dilangalen) on 1 June 2007 as representative of
the legislative district of Shariff Kabunsuan Province with Cotabato City.
In his Comment, respondent Dilangalen countered that Sema is estopped from
questioning COMELEC Resolution No. 7902 because in her certificate of candidacy filed
on29 March 2007, Sema indicated that she was seeking election as representative of Shariff
Kabunsuan including Cotabato City. Respondent Dilangalen added that COMELEC
Resolution No. 7902 is constitutional because it did not apportion a legislative district for
Shariff Kabunsuan or reapportion the legislative districts in Maguindanao but merely renamed
Maguindanaos first legislative district. Respondent Dilangalen further claimed that the
COMELEC could not reapportion Maguindanaos first legislative district to make Cotabato
City its sole component unit as the power to reapportion legislative districts lies exclusively
with Congress, not to mention that Cotabato City does not meet the minimum population
requirement under Section 5 (3), Article VI of the Constitution for the creation of a legislative
district within a city.[13]
Sema filed a Consolidated Reply controverting the matters raised in respondents
Comments and reiterating her claim that the COMELEC acted ultra vires in issuing
Resolution No. 7902.
In the Resolution of 4 September 2007, the Court required the parties in G.R. No.
177597 to comment on the issue of whether a province created by the ARMM Regional
Assembly under Section 19, Article VI of RA 9054 is entitled to one representative in the
House of Representatives without need of a national law creating a legislative district for such
new province. The parties submitted their compliance as follows:
(1) Sema answered the issue in the affirmative on the following grounds: (a) the
Court in Felwa v. Salas[14] stated that when a province is created by statute, the corresponding
representative district comes into existence neither by authority of that statute which cannot
provide otherwise nor by apportionment, but by operation of the Constitution, without a
reapportionment; (b) Section 462 of Republic Act No. 7160 (RA 7160) affirms the
apportionment of a legislative district incident to the creation of a province; and (c) Section 5
(3), Article VI of the Constitution and Section 3 of the Ordinance appended to the Constitution
mandate the apportionment of a legislative district in newly created provinces.
(2) The COMELEC, again represented by the OSG, apparently abandoned its earlier
stance on the propriety of issuing Resolution Nos. 07-0407 and 7902 and joined causes with
Sema, contending that Section 5 (3), Article VI of the Constitution is self-executing. Thus,
every new province created by the ARMM Regional Assembly is ipso facto entitled to one
representative in the House of Representatives even in the absence of a national law; and
(3) Respondent Dilangalen answered the issue in the negative on the following
grounds: (a) the province contemplated in Section 5 (3), Article VI of the Constitution is one
that is created by an act of Congress taking into account the provisions in RA 7160 on the
creation of provinces; (b) Section 3, Article IV of RA 9054 withheld from the ARMM
Regional Assembly the power to enact measures relating to national elections, which
encompasses the apportionment of legislative districts for members of the House of
Representatives; (c) recognizing a legislative district in every province the ARMM Regional
Assembly creates will lead to the disproportionate representation of the ARMM in the House
of Representatives as the Regional Assembly can create provinces without regard to the
requirements in Section 461 of RA 7160; and (d) Cotabato City, which has a population of less
than 250,000, is not entitled to a representative in the House of Representatives.
On 27 November 2007, the Court heard the parties in G.R.
No. 177597 in
oral arguments on the following issues: (1) whether Section 19, Article VI of RA 9054,
delegating to the ARMM Regional Assembly the power to create provinces, is constitutional;
and (2) if in the affirmative, whether a province created under Section 19, Article VI of RA
9054 is entitled to one representative in the House of Representatives without need of a
national law creating a legislative district for such new province. [15]
In compliance with the Resolution dated 27 November 2007, the parties in G.R. No.
177597 filed their respective Memoranda on the issues raised in the oral arguments. [16] On the
question of the constitutionality of Section 19, Article VI of RA 9054, the parties in G.R. No.
177597 adopted the following positions:
(1) Sema contended that Section 19, Article VI of RA 9054 is constitutional (a) as a
valid delegation by Congress to the ARMM of the power to create provinces under Section 20
(9), Article X of the Constitution granting to the autonomous regions, through their organic
acts, legislative powers over other matters as may be authorized by law for the promotion of
the general welfare of the people of the region and (b) as an amendment to Section 6 of RA
7160.[17] However, Sema concedes that, if taken literally, the grant in Section 19, Article VI of
RA 9054 to the ARMM Regional Assembly of the power to prescribe standards lower than
those mandated in RA 7160 in the creation of provinces contravenes Section 10, Article X of
the Constitution.[18] Thus, Sema proposed that Section 19 should be construed as prohibiting
the Regional Assembly from prescribing standards x x x that do not comply with the minimum
criteria under RA 7160.[19]
(2) Respondent Dilangalen contended that Section 19, Article VI of RA 9054 is
unconstitutional on the following grounds: (a) the power to create provinces was not among
those granted to the autonomous regions under Section 20, Article X of the Constitution and
(b) the grant under Section 19, Article VI of RA 9054 to the ARMM Regional Assembly of
the power to prescribe standards lower than those mandated in Section 461 of RA 7160 on the
creation of provinces contravenes Section 10, Article X of the Constitution and the Equal
Protection Clause; and
(3) The COMELEC, through the OSG, joined causes with respondent Dilangalen
(thus effectively abandoning the position the COMELEC adopted in its Compliance with the
Resolution of 4 September 2007) and contended that Section 19, Article VI of RA 9054 is
unconstitutional because (a) it contravenes Section 10 and Section 6, [20] Article X of the
Constitution and (b) the power to create provinces was withheld from the autonomous regions
under Section 20, Article X of the Constitution.
The Issues
For Congress to delegate validly the power to create a province or city, it must also
validly delegate at the same time the power to create a legislative district. The threshold issue
then is, can Congress validly delegate to the ARMM Regional Assembly the power to create
legislative districts for the House of Representatives? The answer is in the negative.
Legislative Districts are Created or Reapportioned
Only by an Act of Congress
Under the present Constitution, as well as in past [28] Constitutions, the power to
increase the allowable membership in the House of Representatives, and to reapportion
legislative districts, is vested exclusively in Congress. Section 5, Article VI of the
Constitution provides:
SECTION 5. (1) The House of Representatives shall be
composed of not more than two hundred and fifty members, unless
otherwise fixed by law, who shall be elected from legislative districts
apportioned among the provinces, cities, and the Metropolitan Manila area
in accordance with the number of their respective inhabitants, and on the
basis of a uniform and progressive ratio, and those who, as provided by
law, shall be elected through a party-list system of registered national,
regional, and sectoral parties or organizations.
xxxx
Under Section 19, Article VI of RA 9054, Congress delegated to the ARMM Regional
Assembly the power to create provinces, cities, municipalities and barangays within the
ARMM. Congress made the delegation under its plenary legislative powers because the
power to create local government units is not one of the express legislative powers granted by
the Constitution to regional legislative bodies. [27] In the present case, the question arises
whether the delegation to the ARMM Regional Assembly of the power to create provinces,
cities, municipalities and barangays conflicts with any provision of the Constitution.
There is no provision in the Constitution that conflicts with the delegation to regional
legislative bodies of the power to create municipalities and barangays, provided Section 10,
Article X of the Constitution is followed. However, the creation of provinces and cities is
another matter. Section 5 (3), Article VI of the Constitution provides, Each city with a
population of at least two hundred fifty thousand, or each province, shall have at least one
representative in the House of Representatives. Similarly, Section 3 of the Ordinance
appended to the Constitution provides, Any province that may hereafter be created, or any
city whose population may hereafter increase to more than two hundred fifty thousand shall be
entitled in the immediately following election to at least one Member x x x.
Clearly, a province cannot be created without a legislative district because it will
violate Section 5 (3), Article VI of the Constitution as well as Section 3 of the Ordinance
appended to the Constitution. For the same reason, a city with a population of 250,000 or more
cannot also be created without a legislative district. Thus, the power to create a province, or a
city with a population of 250,000 or more, requires also the power to create a legislative
district. Even the creation of a city with a population of less than 250,000 involves the power
to create a legislative district because once the citys population reaches 250,000, the city
automatically becomes entitled to one representative under Section 5 (3), Article VI of the
Constitution and Section 3 of the Ordinance appended to the Constitution. Thus, the power to
create a province or city inherently involves the power to create a legislative district.
Section 5 (1), Article VI of the Constitution vests in Congress the power to increase,
through a law, the allowable membership in the House of Representatives. Section 5 (4)
empowers Congress to reapportion legislative districts. The power to reapportion legislative
districts necessarily includes the power to create legislative districts out of existing ones.
Congress exercises these powers through a law that Congress itself enacts, and not through a
law that regional or local legislative bodies enact. The allowable membership of the House of
Representatives can be increased, and new legislative districts of Congress can be created,
only through a national law passed by Congress. InMontejo v. COMELEC,[29] we held that the
power of redistricting x x x is traditionally regarded as part of the power (of Congress) to
make laws, and thus is vested exclusively in Congress.
This textual commitment to Congress of the exclusive power to create or reapportion
legislative districts is logical. Congress is a national legislature and any increase in its
allowable membership or in its incumbent membership through the creation of legislative
districts must be embodied in a national law. Only Congress can enact such a law. It would be
anomalous for regional or local legislative bodies to create or reapportion legislative districts
for a national legislature like Congress. An inferior legislative body, created by a superior
legislative body, cannot change the membership of the superior legislative body.
The creation of the ARMM, and the grant of legislative powers to its Regional
Assembly under its organic act, did not divest Congress of its exclusive authority to create
legislative districts. This is clear from the Constitution and the ARMM Organic Act, as
amended. Thus, Section 20, Article X of the Constitution provides:
SECTION 20. Within its territorial jurisdiction and subject to
the provisions of this Constitution and national laws, the organic act of
autonomous regions shall provide for legislative powers over:
(1)
Administrative organization;
(2)
Creation of sources of revenues;
(3)
Ancestral domain and natural resources;
(4)
Personal, family, and property relations;
(5)
Regional urban and rural planning development;
(6)
Economic, social, and tourism development;
(7)
Educational policies;
(8)
Preservation and development of the cultural heritage;
and
(9)
Such other matters as may be authorized by law for the
promotion of the general welfare of the people of the region.
Nothing in Section 20, Article X of the Constitution authorizes autonomous regions,
expressly or impliedly, to create or reapportion legislative districts for Congress.
On the other hand, Section 3, Article IV of RA 9054 amending the ARMM Organic
Act, provides, The Regional Assembly may exercise legislative power x x x except on the
following matters: x x x (k) National elections. x x x. Since the ARMM Regional
Assembly has no legislative power to enact laws relating to national elections, it cannot create
a legislative district whose representative is elected in national elections. Whenever Congress
enacts a law creating a legislative district, the first representative is always elected in the next
national elections from the effectivity of the law. [30]
Indeed, the office of a legislative district representative to Congress is a national
office, and its occupant, a Member of the House of Representatives, is a national
official.[31] It would be incongruous for a regional legislative body like the ARMM Regional
Assembly to create a national office when its legislative powers extend only to its regional
territory. The office of a district representative is maintained by national funds and the salary
of its occupant is paid out of national funds. It is a self-evident inherent limitation on the
legislative powers of every local or regional legislative body that it can only create local or
regional offices, respectively, and it can never create a national office.
To allow the ARMM Regional Assembly to create a national office is to allow its
legislative powers to operate outside the ARMMs territorial jurisdiction. This violates
Section 20, Article X of the Constitution which expressly limits the coverage of the
Regional Assemblys legislative powers [w]ithin its territorial jurisdiction x x x.
Thus, the Court sustained the constitutionality of RA 4695 because (1) it validly created
legislative districts indirectly through a special law enacted by Congresscreating a
province and (2) the creation of the legislative districts will not result in breaching the
maximum number of legislative districts provided under the 1935 Constitution. Felwa does
not apply to the present case because in Felwa the new provinces were created by a national
law enacted by Congress itself. Here, the new province was created merely by a regional
law enacted by the ARMM Regional Assembly.
What Felwa teaches is that the creation of a legislative district by Congress does not
emanate alone from Congress power to reapportion legislative districts, but also from
Congress power to create provinces which cannot be created without a legislative
district. Thus, when a province is created, a legislative district is created by operation of the
Constitution because the Constitution provides that each province shall have at least
one representative in the House of Representatives. This does not detract from the
constitutional principle that the power to create legislative districts belongs exclusively to
Congress. It merely prevents any other legislative body, except Congress, from creating
provinces because for a legislative body to create a province such legislative body must have
the power to create legislative districts. In short, only an act of Congress can trigger the
creation of a legislative district by operation of the Constitution. Thus, only Congress has the
power to create, or trigger the creation of, a legislative district.
Moreover, if as Sema claims MMA Act 201 apportioned a legislative district to
Shariff Kabunsuan upon its creation, this will leave Cotabato City as the lone component of
the first legislative district of Maguindanao. However, Cotabato City cannot constitute a
legislative district by itself because as of the census taken in 2000, it had a population of only
163,849. To constitute Cotabato City alone as the surviving first legislative district of
Maguindanao will violate Section 5 (3), Article VI of the Constitution which requires that
[E]ach city with a population of at least two hundred fifty thousand x x x, shall have at least
one representative.
Second. Semas theory also undermines the composition and independence of the
House of Representatives. Under Section 19, [33] Article VI of RA 9054, the ARMM Regional
Assembly can create provinces and cities within the ARMM with or without regard to the
criteria fixed in Section 461 of RA 7160, namely: minimum annual income of P20,000,000,
and minimum contiguous territory of 2,000 square kilometers or minimum population of
250,000.[34] The following scenarios thus become distinct possibilities:
(1) An inferior legislative body like the ARMM Regional
Assembly can create 100 or more provinces and thus increase the
membership of a superior legislative body, the House
of
Representatives, beyond the maximum limit of 250 fixed in the
Constitution (unless a national law provides otherwise);
(2) The proportional representation in the House
of Representatives based on one representative for at least every 250,000
residents will be negated because the ARMM Regional Assembly need not
comply with the requirement in Section 461(a)(ii) of RA 7160 that every
province created must have a population of at least 250,000; and
(3) Representatives from the ARMM provinces can become the
majority in the House of Representatives through the ARMM Regional
Assemblys continuous creation of provinces or cities within the ARMM.
The following exchange during the oral arguments of the petition in G.R. No.
177597 highlights the absurdity of Semas position that the ARMM Regional Assembly can
create provinces:
Justice Carpio:
So, you mean to say [a] Local Government can create legislative
district[s] and pack Congress with their own representatives [?]
Atty. Vistan II:[35]
Yes, Your Honor, because the Constitution allows that.
Justice Carpio:
(Emphasis supplied)
Neither the framers of the 1987 Constitution in adopting the provisions in Article X
on regional autonomy,[37] nor Congress in enacting RA 9054, envisioned or intended these
disastrous consequences that certainly would wreck the tri-branch system of government under
our Constitution. Clearly, the power to create or reapportion legislative districts cannot be
delegated by Congress but must be exercised by Congress itself. Even the ARMM Regional
Assembly recognizes this.
The Constitution empowered Congress to create or reapportion legislative districts, not
the regional assemblies. Section 3 of the Ordinance to the Constitution which states, [A]ny
province that may hereafter be created x x x shall be entitled in the immediately following
election to at least one Member, refers to a province created by Congress itself through a
national law. The reason is that the creation of a province increases the actual membership of
the House of Representatives, an increase that only Congress can decide. Incidentally, in the
present 14th Congress, there are 219[38] district representatives out of the maximum 250 seats
in the House of Representatives. Since party-list members shall constitute 20 percent of total
membership of the House, there should at least be 50 party-list seats available in every
election in case 50 party-list candidates are proclaimed winners. This leaves only 200 seats for
district representatives, much less than the 219 incumbent district representatives. Thus, there
is a need now for Congress to increase by law the allowable membership of the House, even
before Congress can create new provinces.
It is axiomatic that organic acts of autonomous regions cannot prevail over the
Constitution. Section 20, Article X of the Constitution expressly provides that the legislative
powers of regional assemblies are limited [w]ithin its territorial jurisdiction and subject to
the provisions of the Constitution and national laws, x x x. The Preamble of the ARMM
Organic Act (RA 9054) itself states that the ARMM Government is established within the
framework of the Constitution. This follows Section 15, Article X of the Constitution which
mandates that the ARMM shall be created x x x within the framework of this
Constitution and the national sovereignty as well as territorial integrity of the Republic
of the Philippines.
The present case involves the creation of a local government unit that necessarily
involves also the creation of a legislative district. The Court will not pass upon the
constitutionality of the creation of municipalities and barangays that does not comply with the
criteria established in Section 461 of RA 7160, as mandated in Section 10, Article X of the
Constitution, because the creation of such municipalities and barangays does not involve the
creation of legislative districts. We leave the resolution of this issue to an appropriate case.
In summary, we rule that Section 19, Article VI of RA 9054, insofar as it grants to the
ARMM Regional Assembly the power to create provinces and cities, is void for being contrary
to Section 5 of Article VI and Section 20 of Article X of the Constitution, as well as Section 3
of the Ordinance appended to the Constitution. Only Congress can create provinces and cities
because the creation of provinces and cities necessarily includes the creation of legislative
districts, a power only Congress can exercise under Section 5, Article VI of the Constitution
and Section 3 of the Ordinance appended to the Constitution. The ARMM Regional Assembly
cannot create a province without a legislative district because the Constitution mandates that
every province shall have a legislative district. Moreover, the ARMM Regional Assembly
cannot enact a law creating a national office like the office of a district representative of
Congress because the legislative powers of the ARMM Regional Assembly operate only
within its territorial jurisdiction as provided in Section 20, Article X of the Constitution. Thus,
we rule that MMA Act 201, enacted by the ARMM Regional Assembly and creating the
Province of Shariff Kabunsuan, is void.
Resolution No. 7902 Complies with the Constitution
Consequently, we hold that COMELEC Resolution No. 7902, preserving the
geographic and legislative district of the First District of Maguindanao with Cotabato City, is
valid as it merely complies with Section 5 of Article VI and Section 20 of Article X of the
Constitution, as well as Section 1 of the Ordinance appended to the Constitution.
WHEREFORE, we declare Section 19, Article VI of Republic Act No.
9054 UNCONSTITUTIONAL insofar as it grants to the Regional Assembly of the
Autonomous Region in Muslim Mindanao the power to create provinces and cities. Thus, we
declare VOID Muslim Mindanao Autonomy Act No. 201 creating the Province of Shariff
Kabunsuan. Consequently, we rule that COMELEC Resolution No. 7902 is VALID.
Let a copy of this ruling be served on the President of the Senate and the Speaker of
the House of Representatives.
SO ORDERED.
December 2, 2009
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
THIRD DIVISION
NORTHERN
LUZON
REGIONAL
CENTER, represented by its Regional
President JIMMY D. SALMAN, in their
own individual capacities and in behalf of
the members of the associations and all
affected officers and employees of National
Power Corporation (NPC), ZOL D.
MEDINA, NARCISO M. MAGANTE,
VICENTE B. CIRIO, JR., NECITAS B.
CAMAMA, in their individual capacities
as employees of National Power
Corporation,
RESOLUTION
CHICO-NAZARIO, J.:
Under consideration are the following:
Present:
CORONA, J.,
Chairperson,
CHICO-NAZARIO,
VELASCO, JR.,
DE CASTRO,* and
BRION,** JJ.
1.
Petitioners Manifestation with Urgent Motion dated 9 February 2009;
2.
Power Sector Assets and Liabilities Management Corporations
(PSALMs) Manifestation dated 24 February 2009;
3.
National Power Corporations (NPCs) Compliance dated 9 March
2009;
4.
Petitioners Counter-Manifestation dated 13 March 2009;
5.
Petitioners Comment/Manifestation and Urgent Motion dated 23
March 2009;
6.
PSALMs Submission dated 20 April 2009;
7.
NPCs Consolidated Comment dated 26 May 2009; and
8.
Petitioners Reply to NPCs Consolidated Comment dated 5 June 2009.
In Our decision dated 26 September 2006, we declared void and without legal effect
National Power Board (NPB) Resolutions No. 2002-124[1] and No. 2002-125,[2] both dated 18
November 2002, which directed, inter alia, the termination from the service of all employees
of the National Power Corporation (NPC) on 31 January 2003 in line with the restructuring of
the NPC, and thereafter enjoined the implementation of said resolutions by granting the
petition for injunction.[3]
Petitioners,
- versusTHE
NATIONAL
POWER
CORPORATION (NPC), NATIONAL
POWER BOARD OF DIRECTORS
(NPB), JOSE ISIDRO N. CAMACHO as
Chairman of the National Power Board of
Directors
(NPB),
ROLANDO
S.
QUILALA, as President Officer-incharge/CEO
of
National
Power
Corporation and Member of National
Power Board, and VINCENT S. PEREZ,
JR., EMILIA T. BONCODIN, MARIUS P.
CORPUS, RUBEN S. REINOSO, JR.,
GREGORY L. DOMINGO and NIEVES
L. OSORIO,
Respondents.
Promulgated:
Finding petitioners Motion for Urgent Execution meritorious, we granted the same
per resolution dated 10 December 2008, and issued the following order:
1.
2.
3.
(2)
specifically, it said only the services of sixteen (16) NPC employees occupying the positions
of Senior Vice-President, Vice-President and Department Manager, were terminated on 31
January 2003, but were rehired on 1 February 2003 after receiving a full separation package
pursuant to the EPIRA. It explained that any additional payment of separation pay, backwages
and other benefits to these 16 employees would be iniquitous and would constitute unjust
enrichment as they were never unemployed.
It further stated that NPB Resolutions No. 2002-124 and No. 2002-125 were
nullified because they were signed by alternates. This infirmity, it explained, was rectified and
effectively mooted with the issuance of NPB Resolution No. 2007-55[19] dated 14 September
2007 which adopted, confirmed and approved the principles and guidelines enunciated in NPB
Resolutions No. 2002-124 and No. 2002-125. It likewise pointed out that the validity of NPB
Resolution No. 2007-55 has not yet been passed upon by the Court.
On 13 March 2009, petitioners filed a Counter-Manifestation[20] to PSALMs
Manifestation dated 24 February 2009 stating that a writ of execution may be issued against
non-parties, including the PSALM, under, among others, the following situations: (1) one who
is privy to the judgment debtor; (2) a successor-in-interest; and (3) under the principle of
piercing the veil of corporate fiction. Petitioners explained that PSALM is privy to NPC
because the former was principally organized to manage the orderly sale, disposition, and
privatization of NPC generation assets, real estate and other disposable assets, and
Independent Power Producers (IPP) contracts with the objective of liquidating all NPC
financial obligations and stranded contract costs in an optimal manner. PSALM, also being a
successor-in-interest of NPC, is now the owner of the financial obligations/liabilities of NPC
and shall be considered as one with NPC and the liability of the latter shall attach to the
former. Further, it said PSALM is a mere alter ego or business conduit of NPC as evidenced
by the fact that majority of the members of the NPB also constitutes the majority of the
PSALM Board and that the NPB and the PSALM Board have held joint board meetings to
resist payment in relation to the 10 December 2008 Resolution. Petitioners disclosed that the
NPB and the PSALM Board recently issued a joint letter-instruction to the power consumers
of NPC that all payments for power sales shall be directly remitted to PSALM. They further
claimed that this letter-instruction violates the EPIRA Law because the payment for power
sales to NPC is not enumerated among the funds, assets, contribution and other properties that
constitute the property of PSALM, and that these payments constitute gross income revenue
and not net profits of NPC. As a garnishee, PSALM need not be summoned or impleaded as a
party to the case.
On 24 March 2009, petitioners filed their Comment/Manifestation and Urgent
Motions (1) To include for Contempt Respondents Counsels and (2) To Summon the VicePresident, Human Resources and Administration, NPC to Attest and Certify Certain Official
Documents.[21] Petitioners point out that respondents, in their compliance, raise two new
issues, to wit: (1) there are only 16 NPC personnel (top executives) who were illegally
terminated; and (2) the issuance of NPB Resolution No. 2007-55 on 14 September
2007 effectively rectified and mooted the infirmity of the nullified NPB Resolutions No. 2002124 and No. 2002-125.
On the first issue, petitioners explain that respondents misrepresentation that there
were only 16 NPC personnel whose services were terminated on 31 January 2003 is true but is
only half-true. They have intentionally suppressed and conveniently omitted in their
Compliance to mention and inform the Court of the fact that while under NPB Resolution No.
2002-124 the services of all NPC personnel/employees were deemed legally terminated as of
31 January 2003, for various reasons, their actual termination was effected on different dates,
as follows: (a) top executives 31 January 2003; (b) early-leavers 15 January 2003; (c)
those no longer employed in NPC after 26 June 2001 date of actual separation; (d) all other
personnel 28 February 2003. In support thereof, they mentioned NPB Resolution No. 200311, NPC Circular No. 2003-09 and the Memorandum dated 26 February 2009 of Dr. Eduardo
R. Eroy, Vice-President, Human Resources and Administration (HRA), NPC. They revealed
that NPB Resolution No. 2003-11 is one of the resolutions ratified and confirmed by NPB
Resolution No. 2007-55.
As to the second issue, petitioners argue that since NPB Resolutions No. 2002-124
and No. 2002-125 are null and without legal effect, the same cannot be rectified and ratified
since only voidable acts can be validated.
In our Resolution dated 15 April 2009, the Court, among other things, required NPC
to file its Comment on Petitioners Manifestation with Urgent Omnibus Motions dated9
February 2009 and Comment/Manifestation and urgent motions dated 23 March 2009, and on
PSALMs Manifestation dated 24 February 2009. The Court deferred action on petitioners
motion for implementation of the issued writ of execution dated 10 February 2009 pending
filing by NPC of the afore-said comments.[22]
On 5 May 2009, PSALM filed a Submission to petitioners Counter-Manifestation
dated 13 March 2009.[23] It argued that a writ of execution can be issued only against a party
and not against one who did not have his day in court. It said it is neither a successor-ininterest nor an alter-ego or business conduit of NPC. Being employees of NPC, PSALM
cannot be made liable for the financial obligations of NPC to its employees. It claims that
petitioners claim on the supposed conduct of joint board meetings of NPC and PSALM
Boards is purely conjectural and without factual basis. The sending of letters to distribution
utilities, like MERALCO, is a consequence of the implementation of the EPIRA as to the
ownership by PSALM of all NPC generation assets, IPP Contracts, etc. On the claim that
payment for power sales by customers are not one of those under the EPIRA as constituting
properties of PSALM and that they constitute gross income and not net profits of NPC,
PSALM argues that same is absurd because as owner of the generation assets, it is entitled to
the income derived from the sale of electricity. Said income partakes of the nature of fruits
which belong to the owner of the asset. Finally, it argued that not being a party in the case or
judgment debtor, its properties cannot be garnished.
On 27 May 2009, petitioners Ora Limpao, Abdullah Ali, Moctar D. Amundia,
Macawali D. Minalang, Aliola Cawi, Talib Manudi and Masiding Tanggo filed a
Manifestation and Motion reiterating their prayer in their Motion for Implementation of the
Issued Writ of Execution motion dated 11 February 2009.[24]
On 28 May 2009, respondent NPC filed its Consolidated Comment [25] on
Petitioners Manifestation with Urgent Omnibus Motions dated 9 February 2009 and
Comment/Manifestation and urgent motions dated 23 March 2009, and on PSALMs
Manifestation dated 24 February 2009.
On PSALMs Manifestation, NPC agreed with PSALM that execution of its
properties is improper as it is not a party in the case.
On petitioners Manifestation and Comment, NPC contends that petitioners are
either confused or deviously sneaking into the present controversy facts, issues and reliefs that
have not been litigated or resolved in the instant case. It argues that it involves the
nullification of NPB Resolutions Nos. 2002-124 and 2002-125 did not affect the
reorganization of the NPC because other resolutions pursuant thereto remain valid. The Court
even declared in its 17 September 2008 Resolution that the NPC can still pursue its
reorganization although it cannot implement the same by terminating petitioners employment
on 31 January 2003 pursuant to NPB Resolutions No. 2002-124 and 2002-125. Under
Resolutions No. 2002-124 and No. 2002-125, only the services of 16 top level employees were
terminated. As admitted by petitioners, the services of other NPC employees were terminated
on 28 February 2003 pursuant to NPB Resolution No. 2003-11. The validity of this latter
resolution has not been the subject of the present controversy.
On 5 June 2009, petitioners filed their Reply to NPCs Consolidated
Comment.[26] Petitioners reiterated their Counter-Manifestation dated 13 March 2009 to
PSALMs Manifestation dated 24 February 2009. In addition, they explained that the purpose
of the EPIRA in creating PSALM is to sell and dispose the assets of NPC and to use the
proceeds therefrom to liquidate all the financial obligations and liabilities of the NPC. It
quoted Congressman Arnulfo P. Fuentebellas opinion which was in response to a legal
opinion of Cyril C. del Callar, former NPC President, as to the function of PSALM. The
opinion partly reads: The function of PSALM is limited and akin to that of a liquidator of NPC
assets as stated in Section 50 of the EPIRA that the principal purpose of PSALM is to manage
the orderly sale, disposition, and privatization of NPC generation assets, real estate and other
disposable assets, and IPP contracts with the end in view of liquidating all NPC financial
obligations and stranded contract costs in an optimal manner.
Petitioners insists it is the NPC and its counsel (Office of the Solicitor General), not
them, that are guilty of raising new issues without valid and legal justification. They
explained that the Court had settled the following issues: (1) NPB Resolutions No. 2002-124
and No. 2002-125 are null and without legal effect; (2) as a consequence of the declaration of
nullity of said resolutions, petitioners have the right to reinstatement or to separation in lieu of
reinstatement pursuant to a validly approved Separation Program plus backwages, wage
adjustments and other benefits accruing from January 2003 to the date of their reinstatement or
payment of separation pay; and (3) 10% charging lien of Attys. Aldon and Orocio.
All these notwithstanding, NPC raised two new issues in a desperate effort to
circumvent, frustrate and delay the final and executory orders of the Court, to wit: (1) there are
only 16 NPC personnel (top executives) who were illegally terminated on 31 January 2003;
and (2) the issuance of NPB Resolution No. 2007-55 on 14 September 2007 effectively
rectified and mooted the purported infirmity of the nullified NPB Resolutions No. 2002-124
and No. 2002-125. NPCs raising these issues after the Courts decision and resolution have
become final and executory is a clear case of afterthought and act of desperation. Petitioners
claim that the NPC had all the time to raise said issues before the decision and resolution
became final and executory, but it did not. Thus, it is guilty of estoppel. Petitioners added
that the NPC in its Motion for Reconsideration and Motion for Leave to File Second Motion
for Reconsideration admitted that the nullification of National Power Board Resolution Nos.
2002-124 and 2002-125 have far reaching implications and dreadful aftermath. For one, it
would entail a financial liability on the part of respondent in the amount of not less than FOUR
BILLION SEVEN HUNDRED ONE MILLION THREE HUNDRED FIFTY-FOUR
THOUSAND SEVENTY-THREE PESOS (P4,701,354,073.00), representing the backwages
and wage adjustments of employees. (as of October 2006) This admission, petitioners
contend, belies NPCs claim that only 16 were illegally terminated pursuant to NPB
Resolutions No. 2002-124 and No. 2002-125 considering that such amount cannot obviously
cover only 16 employees but thousands of NPC personnel.
Moreover, petitioners alleged that the NPC, through its numerous pleadings, made
them and the Court believe that pursuant to the null NPB Resolutions No. 2002-124 and No.
2002-125, all NPC personnel were legally terminated as of 31 January 2003. The issue that
only 16 employees were terminated on 31 January 2003 was never raised before the Courts
decision and resolution became final and executory. Now, after eight long years, NPC
suddenly tells the Court that only 16 employees were terminated as of 31 January 2003. Such
behavior shows lack of candor, honesty and fairness to the Court and to petitioners.
line with the restructuring of the NPC. All the while, the Court and the parties were on the
same wavelength tackling the issue of whether the termination of all NPC employees pursuant
to NPB Resolutions No. 2002-124 and No. 2002-125, is valid. In fact, it is NPCs stand that
pursuant to NPB Resolutions No. 2002-124 and No. 2002-125, all NPC personnel were legally
terminated as of 31 January 2003. It is only after when our decision and resolution on the
matter became final and executory did NPC reveal that not all, but only 16 top-level
employees, were terminated on 31 January 2003.
Petitioners pray that: (1) all the respondents and their counsels be held in contempt
of court and punished accordingly until or unless they immediately execute the
decision/resolution of the Court; (2) to summon and/or direct Mr. Edmund P. Anguluan, the
present Vice-President, Human Resources and Administration of NPC, to fully and strictly
comply with paragraph 1 of the 10 December 2008 Resolution - the list should include all
personnel who were terminated pursuant to or as a result of the null NPB Resolutions No.
2002-124 and No. 2002-125 regardless of their actual dates of termination; and (3) to appoint
and authorize the Clerk of Court and Ex-Oficio Sheriff of the RTC of Quezon City to enforce
by execution the Courts 10 December 2008 Resolution by garnishment/levy upon the assets
of NPC, including but not limited to the assets of PSALM, based on the list and computations
submitted and attested to by the aforenamed Vice-President of NPC.
We find such action of NPC and its counsel improper. Why only now at this stage of
the proceedings? NPC cannot possibly deny that the employees subject of the instant case
involves all the personnel/employees of the NPC. As correctly pointed out by petitioners,
NPCs statement in its Motion for Reconsideration and Motion for Leave to File Second
Motion for Reconsideration that the nullification of NPB Resolutions No. 2002-124 and No.
2002-125 has far reaching implications and dreadful aftermath for it would entail a financial
liability on its part in the amount of not less than P4,701,354,073.00 proves that what NPC is
alluding to is the termination of all the employees of the NPC for the simple reason that said
amount cannot be for the backwages, separation pay and other benefits of just 16 employees
but thousands of NPC personnel.
The principal question to be resolved is: should the execution of our decision and
resolution which have become final and executory on 10 October 2008 be stopped or be
prevented because of the new issues raised by NPC? The two new issues are: (1) whether or
not our decision affects only 16 employees or all the employees of NPC; and (2) whether or
not NPB Resolutions No. 2002-124 and No. 2002-125 can be ratified by NPB Resolution No.
2007-55[27] which was issued on 14 September 2007.
On the first issue, NPC contends it has complied with the directive of the Supreme
Court to list all employees terminated/separated as a result of, or pursuant to, NPB Resolutions
No. 2002-124 and No. 2002-125. It stated that only its top-level employees, numbering
sixteen (16), occupying the positions of Senior Vice-President, Vice-President and Department
Manager were terminated on 31 January 2003 pursuant to the aforesaid resolutions contrary to
the position of petitioners that all employees of NPC were terminated/separated on 31 January
2003. NPC added that these 16 employees who were terminated/separated on 31 January
2003 were rehired after receiving a full separation package pursuant to the EPIRA law. Thus,
payment of any backwages and other benefits to these 16 employees are unnecessary and
unwarranted.
It is unquestionable that when we promulgated our decision on 26 September 2006
and our subsequent resolutions dated 24 January 2007, 17 September 2008 and 10 December
2008, we were referring to all employees of the NPC, not only the 16 top-level employees, as
those whose services were terminated on 31 January 2003. This was based on the nullified
NPB Resolution No. 2002-124 which reads in part:
RESOLVED, FURTHER, That, pursuant to Section 63 of the
EPIRA and Rule 33 of the IRR, all NPC personnel shall be legally
terminated on January 31, 2003, and shall be entitled to the separation
benefits as provided in the Guidelines hereunder adopted. [28]
When the instant case was commenced with the filing of the petition, what was sought to be
enjoined was the termination of all, not sixteen (16), NPC employees on 31 January 2003 in
Under NPB Resolution No. 2002-124, the services of all NPC personnel/employees
were deemed legally terminated as of 31 January 2003. However, because it was no longer
tenable for NPC to complete the legal separation of NPC employees on 31 January 2003, NPB
Resolution No. 2003-11 dated 22 January 2003 was issued showing the effectivity of
termination of personnel on 28 February 2003. NPC intentionally did not inform the Court
that the separation of other employees holding the positions of below Vice-President levels,
supervisors and rank-and-file was 28 February 2003 pursuant to NPB Resolution No. 2003-11
dated 22 January 2003. Furthermore, under NPC Circular No. 2003-09,[29] the dates of legal
termination of all employees were as follows: (a) key officials 31 January 2003; (b) earlyleavers 15 January 2003; (c) those no longer employed in NPC after 26 June 2001 date of
actual separation; and (d) all other personnel 28 February 2003. To further show that what
is covered by the Courts resolution dated 10 December 2008 are all the NPC employees,
petitioners attached a memorandum[30] from Eduardo R. Eroy, Vice-President, HRM, NPC, to
NPC President Froilan A. Tampinco explaining the amount of backwages, separation pay and
other benefits to be received by the NPC terminated NPC employees.
From all these, it is clear that our ruling, pursuant to NPB Resolution No. 2002-124,
covers all employees of the NPC and not only the 16 employees as contended by
NPC. However, as regards their right to reinstatement, or separation pay in lieu of
reinstatement, pursuant to a validly approved Separation Program, plus backwages, wage
adjustments, and other benefits, the same shall be computed from the date of legal termination
as stated in NPC Circular No. 2003-09, to wit:
a)
The legal termination of key officials, i.e., the
Corporate Secretary, Vice Presidents and Senior Vice Presidents who were
appointed under NP Board Resolution No. 2003-12, shall be at the close of
office hours of January 31, 2003.
b)
The legal termination of personnel who availed of
the early leavers scheme shall be on the last day of service in NPC
but not beyond January 15, 2003.
c)
The legal termination of personnel who were no
longer employed in NPC after June 26, 2001 shall be the date of actual
separation in NPC.
d)
For all other NPC personnel, their legal
termination shall be at the close of office hours/shift schedule of February
28, 2003.[31]
but deducting therefrom the amount of separation benefits which they previously received
under the null NPB Resolutions.
On the second issue, NPC contends that when NPB Resolution No. 2007-55[32] dated 14
September 2007 was issued, the same ratified and confirmed NPB Resolutions No. 2002-124
and No. 2002-125. The purported infirmity of NPB Resolutions No. 2002-124 and No. 2002125 was rectified and effectively mooted. In so doing, all the principles and guidelines
enunciated in both resolutions have been adopted, confirmed and approved. In effect, what
NPC is saying is that the decision/resolution can no longer be executed since it has corrected
the infirmity or mistake that caused the nullification of NPB Resolutions No. 2002-124 and
No. 2002-125 by the issuance of NPB Resolution No. 2007-55.
As answer thereto, petitioners argue that NPB Resolutions No. 2002-124 and No. 2002125 cannot be ratified because only voidable acts can be ratified. Petitioners contend that both
resolutions are void.
convincing evidence that rebuts this presumption, we have no option but to rule that said
resolution is valid and effective as of14 September 2007.
We now resolve the issue of whether or not the assets of PSALM can be the subject
of execution it being a non-party in this case.
In their Manifestation with Urgent Omnibus Motions dated 9 February 2009, petitioners
prayed that the decision/resolution of the court be enforced by execution by garnishment/levy
upon the assets of NPC, including but not limited to the assets of PSALM. In opposition
thereto, PSALM stated that not being a party to the case, it is not bound by the decision
rendered by the Court. It explained that there is nothing in the EPIRA Law that allows
garnishment and/or levy of its assets to satisfy a judgment rendered against NPC. Not being
employees of PSALM, the latter states that it cannot be made liable for the financial
obligations of NPC to its employees. PSALM explains that when the EPIRA Law was passed
on 26 June 2001, ownership of all existing NPC generation assets, IPP contracts, real estate
and all other disposable assets were transferred to it by operation of law. All existing
liabilities and outstanding financial obligations of NPC arising from loans, issuances of bonds,
securities and other instrument of indebtedness were legally transferred and assumed by
PSALM. It stressed that the liability of NPC arising from employer-employee relationship is
not one of those transferred to, and assumed by, PSALM. The EPIRA, it said, did not
contemplate such kind of liability. Further, it claims that its assets and the privatization
proceeds cannot be the subject of execution because these were already earmarked specifically
for the liquidation of NPCs financial obligations transferred to, and assumed by, PSALM.
Sections 49 and 50 of the EPIRA Law read:
Petitioners contention that NPB Resolutions No. 2002-124 and No. 2002-125 are void
is correct. In our decision of 26 September 2006, the Court was very categorical in declaring
that NPB Resolutions No. 2002-124 and No. 2002-125 are VOID and WITHOUT LEGAL
EFFECT. The Court has ruled that said resolutions are void for violating Section 48 of the
EPIRA Law which requires the persons enumerated therein to personally exercise their
judgment and discretion. An illegal act is void and cannot be validated. [33] In the instant case,
the approval of both resolutions was an illegal act for it violated the EPIRA Law.
What then is the effect of the approval of NPB Resolution No. 2007-55 on 14
September 2007? The approval of NPB Resolution No. 2007-55, supposedly by a majority of
the National Power Board as designated by law, that adopted, confirmed and approved the
contents of NPB Resolutions No. 2002-124 and No. 2002-125 will have a prospective effect,
not a retroactive effect. The approval of NPB Resolution No. 2007-55 cannot ratify and
validate NPB Resolutions No. 2002-124 and No. 2002-125 as to make the termination of the
services of all NPC personnel/employees on 31 January 2003 valid, because said resolutions
were void.
The approval of NPB Resolution No. 2007-55 on 14 September 2007 means that the
services of all NPC employees have been legally terminated on this date. All separation
pay and other benefits to be received by said employees will be deemed cut on this date. The
computation thereof shall, therefore, be from the date of their illegal termination pursuant to
NPB Resolutions Nos. 2002-124 and 2002-125 as clarified by NPB Resolution No. 2003-11
and NPC Resolution No. 2003-09 up to 14 September 2007. Although the validity of NPB
Resolution No. 2007-55 has not yet been passed upon by the Court, same has to be given
effect because NPB Resolution No. 2007-55 enjoys the presumption of regularity of official
acts. The presumption of regularity of official acts may be rebutted by affirmative evidence of
irregularity or failure to perform a duty. [34] Thus, until and unless there is clear and
Under the EPIRA Law, PSALM shall take ownership of all existing NPC generation
assets, liabilities, IPP contracts, real estate and all other disposable assets. PSALM acquired
ownership over said properties of NPC via the EPIRA Law. It did not deny such fact and even
admitted the same.
denied due process. The levying of said properties and their fruits/proceeds, if still needed in
case NPCs properties are insufficient to satisfy our judgment, is without prejudice to
PSALMs participation in said proceedings. Its participation therein is necessary to prevent
the levying of properties other than that it had acquired from NPC. Such a proceeding is to be
conducted in the proper forum where petitioners may take the appropriate action.
Section 19, Rule 3 of the 1997 Revised Rules of Civil Procedure reads:
PSALM argues that the present judgment obligation of NPC arising from employeremployee relationship was neither an existing financial liability nor a contractual liability of
NPC at the effectivity of the EPIRA Law. From a reading of said section 49, it appears that
only existing NPC generation assets, liabilities, IPP contracts, real estate and all other
disposable assets shall be transferred to PSALM. We, however, rule that the word existing
is to be construed as to qualify only the term NPC generation assets. In arriving at said
ruling, Section 49 must be read in conjunction with Section 50. The interpretation of the word
existing should be understood in light of PSALMs purpose and objective during its term of
existence (25 years from the effectivity of the law). It would be absurd to interpret the word
existing as referring to the assets and liabilities of NPC only existing at the time when the
EPIRA Law took effect (26 June 2001). It is more sensible and equitable that the word
existing applies only to NPC generation assets because of the intent and purpose of the
EPIRA Law which is to privatize NPC generation assets, real estate, and other disposable
assets and IPP contracts. Upon the effectivity of the EPIRA Law, most of the assets of NPC,
from which it got its income, was transferred to PSALM. When the privatization of NPCs
assets is in progress, NPC may still incur liabilities, as what happened in the instant
case. Who then shall answer for these liabilities? How can NPC answer for its liabilities if
PSALM had already acquired almost all of its assets? It would be, under the circumstances,
unfair and unjust if PSALM gets nearly all of NPCs assets but will not pay for liabilities
incurred by NPC during this privatization stage. It must be remembered that the restructuring
of the NPC was due to the EPIRA Law. It is also the EPIRA Law that authorized PSALM to
take ownership of NPCs assets and liabilities. And since the restructuring of NPC, which this
Court found to be void, was the cause of NPCs liability, it is but reasonable for PSALM to
assume the liabilities of NPC during the privatization of the NPCs assets.
It is well settled that courts are not to give a statute a meaning that would lead to
absurdities. If the words of a statute are susceptible of more than one meaning, the absurdity of
the result of one construction is a strong argument against its adoption, and in favor of such
sensible interpretation. We test a law by its result. A law should not be interpreted so as not to
cause an injustice. There are laws which are generally valid but may seem arbitrary when
applied in a particular case because of its peculiar circumstances. We are not bound to apply
them in slavish obedience to their language. [35] The court may consider the spirit and reason
of the statute, where a literal meaning would lead to absurdity, contradiction, injustice, or
would defeat the clear purpose of the lawmakers. [36] Taking into consideration the legislative
intent and applying the rule of reason, we hold that the word existing should be interpreted
to only qualify the term NPC generation assets and not the word liabilities.
On PSALMs contention that since it was not a party to the case and that the
petitioners are not its employees, the properties that it acquired from NPC cannot be levied, is
untenable. The issue here is about PSALMs assets that were acquired from NPC. As
explained above, PSALM took ownership over most of NPCs assets. There was indeed
atransfer of interest over these assets from NPC to PSALM by operation of law. These
properties may be used to satisfy our judgment. This being the case, petitioners may go after
such properties. The fact that PSALM is a non-party to the case will not prevent the levying
of the said properties, including their fruits and proceeds. However, PSALM should not be
Under this section, the Court may, upon motion, direct the person to whom the interest is
transferred to be substituted in the action or joined with the original party. In petitioners
Manifestation with Urgent Omnibus Motions dated 9 February 2009, they prayed that the
properties acquired by PSALM from NPC be also levied/garnished. We consider this prayer
to be tantamount to a motion to join PSALM as a party-respondent in this case in so far as to
the properties, and any income arising therefrom, that PSALM acquired from NPC. It is in
this light that we order the Clerk of Court of this division to implead or join PSALM as a
party-respondent in this case. As above-explained, PSALM shall not be denied due process
for it can participate in the proper forum by preventing the levying of properties other than that
it had acquired from NPC.
We now go to the implementation of our decision. Petitioners submitted to this Court
a list[37] supposedly containing names of employees separated from the NPC pursuant to the
nullified NPB Board Resolutions No. 2002-124 and No. 2002-125 and the respective amounts
they will receive. The computation of the benefits due them started on 1 February
2003/1 March 2003 to 30 June 2009. Even if we are to consider said list to be an official
document released with authority by the NPC, we unfortunately cannot use the same to
determine, at this point, the amounts due each of the affected NPC employees for the simple
reason that amounts due should only be from the date of the employees illegal termination (31
January 2003 for key officials; last day of service in NPC but not beyond 15 January 2003 for
early leavers; date of actual separation for personnel no longer employed at the NPC after 26
June 2001; and 28 February 2003 for all other NPC personnel) [38] up to 14 September 2007
when NPB Resolution No. 2007-55 was issued. This list which should contain the names of
all, not only 16, the affected NPC employees shall be submitted by the Chairperson and
the Members of the National Power Board and the President of the NPC to the proper
person to execute this judgment within ten (10) days from receipt of this resolution.
The instant petition for injunction was filed directly to this Court as mandated by
Section 78[39] of the EPIRA Law. In as much as this Court does not have a sheriff of its own
to execute our decision, we deem it appropriate, pursuant to Section 6, [40] Rule 135 of the
Rules of Court and considering that the principal office of NPC is located in Quezon City, to
authorize the Clerk of Court of the Regional Trial Court and Ex-Officio Sheriff of
Quezon City to execute our judgment which became final and executory on 10 October 2008
and for which an entry of judgment was made on 27 October 2008. After receipt of the list
containing the names of the affected NPC employees and benefits due each of them, the Clerk
of Court of the Regional Trial Court and Ex-Officio Sheriff of Quezon City is directed to
forthwith execute our judgment.
DECISION
CARPIO MORALES, J.:
Rodolfo R. Mago (complainant) filed before the Municipal Trial Court (MTC) of Labo,
Camarines Norte a complaint for grave coercion against Sheriff Alex Rodolfo Angeles
(of the Department of Agrarian Reform Adjudication Board [DARAB]), et al. The case
was docketed as Criminal Case No. 04-7800.
Sheriff Angeles filed a counter-charge for grave threats against complainant and his
sons, docketed as Criminal Case No. 04-7811.
Alleging that Presiding Judge of the MTC Labo, Camarines Sur Judge Aurea G.
Pealosa-Fermo (respondent) committed gross ignorance of the law and bias in the
disposition of his complaint and of the counter-charge against him, complainant filed
the present administrative complaint, the details of which were summarized by the
Office of the Court Administrator (OCA) as follows: 1
Mr. Mago claims that on April 21, 2004 he filed a complaint for Grave
Coercion against Department of Agrarian Reform Adjudication Board (DARAB for
brevity) Sheriff Alex Roberto Angeles which was docketed as Criminal Case No. 047800. However, instead of summoning the accused for a "Preliminary Investigation",
he received a complaint charging him and his two (2) sons with Grave Threats [which
was docketed as Criminal Case No. 04-7811]. He stresses the complaint against him
as purely fabricated. He states that the complainant in the said case was not DARAB
Sheriff Angeles. He avers that the affidavits of the witnesses in the said case could
not be found in the records of the Municipal Trial Court (MTC). Complainant further
declares that on July 20, 2004, he received a subpoena to attend the preliminary
investigation of Criminal Case No. 04-7811. In compliance, he and his witnesses
attended, and even without the assistance of counsel, they were examined through a
prepared set of questions handed to them by the stenographer. The respondent judge
was not present then. The complainant also states that right after the preliminary
investigation, he was immediately arrested and was imprisoned for three (3) days.
Thereafter, he was released after he posted bail in the amount of Php12,000 pesos.
Complainant also alleges that he filed a Petition for Certiorari, Mandamus, Prohibition
with Application for Preliminary Injunction and Ex-Parte Motion for Temporary
Restraining Order questioning the order of respondent judge in denying his omnibus
motion to quash the information, suppress evidence and produce, inspect and copy
documentary evidence. He adds that despite the filing of this petition, the respondent
judge continued to direct him to appear at the pre-trial/preliminary conference. He
likewise avers that his arraignment was set beyond the period allowed by the Rules of
Court. He also laments that he could not locate his lawyer, Atty. Lamberto Bonifacio,
Jr. Finally, he alleges that the respondent judge had been biased when hearing his
case.2 (Italics in the original; emphasis an underscoring supplied)
3
By 2nd Indorsement dated July 31, 2007, respondent gave her side of the case as
follows:
Contrary to complainants allegation, the complaint in Criminal Case No. 04-7811 (for
grave threats), and the affidavits of the therein complainant-sheriffs witnesses were
attached to the record.4
On the allegation of bias on her part, respondent claims that until the criminal
complaints were filed, she did not know any of the parties.
By June 18, 2008 Report,
11
xxxx
. . . [W]e hold [respondent] administratively liable for her unfamiliarity with the basic
rules on preliminary investigation. There was irregularity during the preliminary
investigation when the respondent judge allowed the stenographers to handle the
latter part of the proceedings.
xxxx
. . . [R]espondent admitted that after the complaint was filed, she prepared a set of
questions based on the affidavits of the complaining witnesses and counter affidavits
of the accused. She further added that during the preliminary investigation and after
briefing the accused and his witnesses, the stenographers took charge of the
proceedings. Hence, the respondent judge violated the rules on preliminary
investigation. Respondent should not have allowed her stenographer to handle the
latter part of the proceedings even if she only wanted to expedite the proceedings and
it was more convenient. Respondent judge should have personally taken charge of
the entire proceedings since the power to conduct preliminary investigations
vests only on her and not on the stenographer.
x x x x12 (Emphasis and underscoring supplied)
Finding respondent guilty of gross ignorance of the law or procedure, the OCA
recommended that respondent be FINED in the amount of P20,000 in this wise:
[W]e deem it proper to recommend the imposition upon the respondent judge of a
penalty of fine in the amount of P20,000[,] this being her first offense.
As regards the issue of continuous hearing of the case by the respondent judge, we
opine that the respondent judge only acted in good faith and in accordance with law
when she continued to direct the herein complainant to attend the pre-trial. Based on
the records, the Petition for Certiorari, Mandamus, Prohibition with Application for
Mandatory Injunction and Ex-Parte Motion for Temporary Restraining Order and the
Motion for Reconsideration thereto filed by complainant with the Regional Trial Court,
Branch 64, Labo, Camarines Norte were already denied; thus the respondent judge
had the authority to proceed with the case. The postponements in the pre-trial were
not attributable to the respondent judge but to the accused and his counsel.1avvphi1
Finally, on the issue of bias, complainant failed to submit any evidence showing the
respondent biased or partial in hearing the case. Bias and partiality of a judge must
be proved by clear and convincing evidence. Mere suspicion that a judge is bias or
partial would not be enough.13 (Italics in the original; underscoring supplied)
14
By Resolution of August 20, 2008, the Court, on the recommendation of the OCA,
re-docketed the case and required the parties to manifest within ten days from notice
whether they were willing to submit the matter for resolution on the basis of the
pleadings filed and submitted. Both parties have manifested in the affirmative.
The Court thus finds in order the Recommendation of the OCA to impose a fine
of P20,000 on respondent. The OCAs recommendation to warn respondent that a
"repetition of the same act will be dealt with more severely" does not lie, however,
A.M. No. 05-8-26-SC, which took effect on October 3, 2005, having removed the
power of judges of the first level courts17 to conduct preliminary investigation. A
warning that a commission of another infraction tantamount to gross ignorance of law
or procedures shall be dealt with more severely lies, however.
WHEREFORE, the Court finds respondent, Judge Aurea G. Pealosa-Fermo of the
Municipal Trial Court of Labo, Camarines Norte, guilty of Gross Ignorance of the Law
or Procedure. She is FINED in the amount of Twenty Thousand (P20,000) Pesos and
warned that a commission of another infraction which is tantamount to the same
charge shall be dealt with more severely.
SO ORDERED.
Then, as now, a personal examination of the complainant in a criminal case and his
witness/es was required. Thus, under Section 4, Rule 112 of the Revised Rules of
Court before its amendment, the "investigating fiscal" was required to "certify under
oath that he, or as shown by the record, an authorized officer, has personally
examined the complainant and his witnesses . . . "
By respondents delegation of the examination of the sheriff-complainant in the grave
threats case to the stenographer, and worse, by allowing the witnesses to "read/study
the [written] question[s]" to be propounded to them and to "write their answers
[thereto]" upon respondents justification that the scheme was for the convenience of
the stenographers, respondent betrayed her lack of knowledge of procedure, thereby
contributing to the erosion of public confidence in the judicial system.
Respondent is thus guilty of gross ignorance of the law or procedure which, under
Section 8, Rule 140 of the Rules of Court, is a serious charge, 16 for which Section 11
(A) of the same Rule prescribes the following penalty:
RESOLUTION
TINGA, J.:
SEC. 11. Sanctions. A. If the respondent is guilty of a serious charge, any of the
following sanctions may be imposed:
1. Dismissal from the service, forfeiture of all or part of the benefits as the
Court may determine, and disqualification from reinstatement or appointment
to any public office, including government-owned and controlled
Petitioner Rev. Elly Velez Pamatong filed his Certificate of Candidacy for President on
December 17, 2003. Respondent Commission on Elections (COMELEC) refused to
give due course to petitioners Certificate of Candidacy in its Resolution No.
6558 dated January 17, 2004. The decision, however, was not unanimous since
executive action. The disregard of the provision does not give rise to any cause of
action before the courts.4
An inquiry into the intent of the framers produces the same determination that the
provision is not self-executory. The original wording of the present Section 26, Article
II had read, "The State shall broaden opportunities to public office and prohibit public
dynasties."6 Commissioner (now Chief Justice) Hilario Davide, Jr. successfully
brought forth an amendment that changed the word "broaden" to the phrase "ensure
equal access," and the substitution of the word "office" to "service." He explained his
proposal in this wise:
In this Petition For Writ of Certiorari, petitioner seeks to reverse the resolutions which
were allegedly rendered in violation of his right to "equal access to opportunities for
public service" under Section 26, Article II of the 1987
Constitution,1 by limiting the number of qualified candidates only to those who can
afford to wage a nationwide campaign and/or are nominated by political parties. In so
doing, petitioner argues that the COMELEC indirectly amended the constitutional
provisions on the electoral process and limited the power of the sovereign people to
choose their leaders. The COMELEC supposedly erred in disqualifying him since he
is the most qualified among all the presidential candidates, i.e., he possesses all the
constitutional and legal qualifications for the office of the president, he is capable of
waging a national campaign since he has numerous national organizations under his
leadership, he also has the capacity to wage an international campaign since he has
practiced law in other countries, and he has a platform of government. Petitioner
likewise attacks the validity of the form for the Certificate of Candidacy prepared by
the COMELEC. Petitioner claims that the form does not provide clear and reasonable
guidelines for determining the qualifications of candidates since it does not ask for the
candidates bio-data and his program of government.
First, the constitutional and legal dimensions involved.
Implicit in the petitioners invocation of the constitutional provision ensuring "equal
access to opportunities for public office" is the claim that there is a constitutional right
to run for or hold public office and, particularly in his case, to seek the presidency.
There is none. What is recognized is merely a privilege subject to limitations imposed
by law. Section 26, Article II of the Constitution neither bestows such a right nor
elevates the privilege to the level of an enforceable right. There is nothing in the plain
language of the provision which suggests such a thrust or justifies an interpretation of
the sort.
The "equal access" provision is a subsumed part of Article II of the Constitution,
entitled "Declaration of Principles and State Policies." The provisions under the Article
are generally considered not self-executing,2 and there is no plausible reason for
according a different treatment to the "equal access" provision. Like the rest of the
policies enumerated in Article II, the provision does not contain any judicially
enforceable constitutional right but merely specifies a guideline for legislative or
13
14
As to petitioners attacks on the validity of the form for the certificate of candidacy,
suffice it to say that the form strictly complies with Section 74 of the Omnibus Election
Code. This provision specifically enumerates what a certificate of candidacy should
contain, with the required information tending to show that the candidate possesses
the minimum qualifications for the position aspired for as established by the
Constitution and other election laws.
IN VIEW OF THE FOREGOING, COMELEC Case No. SPP (MP) No. 04-001 is
hereby remanded to the COMELEC for the reception of further evidence, to determine
the question on whether petitioner Elly Velez Lao Pamatong is a nuisance candidate
as contemplated in Section 69 of the Omnibus Election Code.
The COMELEC is directed to hold and complete the reception of evidence and report
its findings to this Court with deliberate dispatch.
SO ORDERED.
*
Davide, Jr., Puno, Vitug , Panganiban, Quisumbing, Ynares-Santiago, SandovalGutierrez, Carpio, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr., and
Azcuna, JJ., concur.
other minor rivers and waterways that eventually discharge water into the
Manila Bay; and the lands abutting the bay, to determine whether they have
wastewater treatment facilities or hygienic septic tanks as prescribed by
existing laws, ordinances, and rules and regulations. If none be found, these
LGUs shall be ordered to require non-complying establishments and homes
to set up said facilities or septic tanks within a reasonable time to prevent
industrial wastes, sewage water, and human wastes from flowing into these
rivers, waterways, esteros, and the Manila Bay, under pain of closure or
imposition of fines and other sanctions.
(3) As mandated by Sec. 8 of RA 9275, the MWSS is directed to provide,
install, operate, and maintain the necessary adequate waste water treatment
facilities in Metro Manila, Rizal, and Cavite where needed at the earliest
possible time.
(4) Pursuant to RA 9275, the LWUA, through the local water districts and in
coordination with the DENR, is ordered to provide, install, operate, and
maintain sewerage and sanitation facilities and the efficient and safe
collection, treatment, and disposal of sewage in the provinces of Laguna,
Cavite, Bulacan, Pampanga, and Bataan where needed at the earliest
possible time.
(5) Pursuant to Sec. 65 of RA 8550, the DA, through the BFAR, is ordered to
improve and restore the marine life of the Manila Bay. It is also directed to
assist the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan,
Pampanga, and Bataan in developing, using recognized methods, the
fisheries and aquatic resources in the Manila Bay.
(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and the PNP Maritime
Group, in accordance with Sec. 124 of RA 8550, in coordination with each
other, shall apprehend violators of PD 979, RA 8550, and other existing laws
and regulations designed to prevent marine pollution in the Manila Bay.
(7) Pursuant to Secs. 2 and 6-c of EO 513 and the International Convention
for the Prevention of Pollution from Ships, the PPA is ordered to immediately
adopt such measures to prevent the discharge and dumping of solid and
liquid wastes and other ship-generated wastes into the Manila Bay waters
from vessels docked at ports and apprehend the violators.
(8) The MMDA, as the lead agency and implementor of programs and
projects for flood control projects and drainage services in Metro Manila, in
coordination with the DPWH, DILG, affected LGUs, PNP Maritime Group,
Housing and Urban Development Coordinating Council (HUDCC), and other
agencies, shall dismantle and remove all structures, constructions, and other
encroachments established or built in violation of RA 7279, and other
applicable laws along the Pasig-Marikina-San Juan Rivers, the NCR
(Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-TullahanTenejeros Rivers, and connecting waterways and esteros in Metro Manila.
The DPWH, as the principal implementor of programs and projects for flood
control services in the rest of the country more particularly in Bulacan,
The government agencies did not file any motion for reconsideration and the Decision
became final in January 2009.
The case is now in the execution phase of the final and executory December 18, 2008
Decision. The Manila Bay Advisory Committee was created to receive and evaluate
the quarterly progressive reports on the activities undertaken by the agencies in
accordance with said decision and to monitor the execution phase.
In the absence of specific completion periods, the Committee recommended that time
frames be set for the agencies to perform their assigned tasks. This may be viewed
as an encroachment over the powers and functions of the Executive Branch headed
by the President of the Philippines.
This view is misplaced.
The issuance of subsequent resolutions by the Court is simply an exercise of judicial
power under Art. VIII of the Constitution, because the execution of the Decision is but
an integral part of the adjudicative function of the Court. None of the agencies ever
questioned the power of the Court to implement the December 18, 2008 Decision nor
has any of them raised the alleged encroachment by the Court over executive
functions.
While additional activities are required of the agencies like submission of plans of
action, data or status reports, these directives are but part and parcel of the execution
stage of a final decision under Rule 39 of the Rules of Court. Section 47 of Rule 39
reads:
Section 47. Effect of judgments or final orders.The effect of a judgment or final
order rendered by a court of the Philippines, having jurisdiction to pronounce the
judgment or final order, may be as follows:
xxxx
(c) In any other litigation between the same parties of their successors in interest, that
only is deemed to have been adjudged in a former judgment or final order which
appears upon its face to have been so adjudged, or which was actually and
necessarily included therein or necessary thereto. (Emphasis supplied.)
It is clear that the final judgment includes not only what appears upon its face to have
been so adjudged but also those matters "actually and necessarily included therein or
necessary thereto." Certainly, any activity that is needed to fully implement a final
judgment is necessarily encompassed by said judgment.
Moreover, the submission of periodic reports is sanctioned by Secs. 7 and 8, Rule 8
of the Rules of Procedure for Environmental cases:
Sec. 7. Judgment.If warranted, the court shall grant the privilege of the writ of
continuing mandamus requiring respondent to perform an act or series of acts until
the judgment is fully satisfied and to grant such other reliefs as may be warranted
resulting from the wrongful or illegal acts of the respondent. The court shall require
the respondent to submit periodic reports detailing the progress and execution of the
judgment, and the court may, by itself or through a commissioner or the appropriate
government agency, evaluate and monitor compliance. The petitioner may submit its
comments or observations on the execution of the judgment.
Sec. 8. Return of the writ.The periodic reports submitted by the respondent
detailing compliance with the judgment shall be contained in partial returns of the writ.
Upon full satisfaction of the judgment, a final return of the writ shall be made to the
court by the respondent. If the court finds that the judgment has been fully
implemented, the satisfaction of judgment shall be entered in the court docket.
(Emphasis supplied.)
With the final and executory judgment in MMDA, the writ of continuing mandamus
issued in MMDA means that until petitioner-agencies have shown full compliance with
the Courts orders, the Court exercises continuing jurisdiction over them until full
execution of the judgment.
There being no encroachment over executive functions to speak of, We shall now
proceed to the recommendation of the Manila Bay Advisory Committee.
Several problems were encountered by the Manila Bay Advisory Committee.2 An
evaluation of the quarterly progressive reports has shown that (1) there are
voluminous quarterly progressive reports that are being submitted; (2) petitioneragencies do not have a uniform manner of reporting their cleanup, rehabilitation and
preservation activities; (3) as yet no definite deadlines have been set by petitioner
DENR as to petitioner-agencies timeframe for their respective duties; (4) as of June
2010 there has been a change in leadership in both the national and local levels; and
(5) some agencies have encountered difficulties in complying with the Courts
directives.
In order to implement the afore-quoted Decision, certain directives have to be issued
by the Court to address the said concerns.
Acting on the recommendation of the Manila Bay Advisory Committee, the Court
hereby resolves to ORDER the following:
(1) The Department of Environment and Natural Resources (DENR), as lead agency
in the Philippine Clean Water Act of 2004, shall submit to the Court on or before June
30, 2011 the updated Operational Plan for the Manila Bay Coastal Strategy.
The DENR is ordered to submit summarized data on the overall quality of Manila Bay
waters for all four quarters of 2010 on or before June 30, 2011.
The DENR is further ordered to submit the names and addresses of persons and
companies in Metro Manila, Rizal, Laguna, Cavite, Bulacan, Pampanga and Bataan
that generate toxic and hazardous waste on or before September 30, 2011.
(2) On or before June 30, 2011, the Department of the Interior and Local Government
(DILG) shall order the Mayors of all cities in Metro Manila; the Governors of Rizal,
Laguna, Cavite, Bulacan, Pampanga and Bataan; and the Mayors of all the cities and
towns in said provinces to inspect all factories, commercial establishments and
private homes along the banks of the major river systemssuch as but not limited to
the Pasig-Marikina-San Juan Rivers, the National Capital Region (Paranaque-Zapote,
Las Pinas) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, the
Meycauayan-Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) River, the Imus
(Cavite) River, and the Laguna De Bayand other minor rivers and waterways within
their jurisdiction that eventually discharge water into the Manila Bay and the lands
abutting it, to determine if they have wastewater treatment facilities and/or hygienic
septic tanks, as prescribed by existing laws, ordinances, rules and regulations. Said
local government unit (LGU) officials are given up to September 30, 2011 to finish the
inspection of said establishments and houses.
In case of non-compliance, the LGU officials shall take appropriate action to ensure
compliance by non-complying factories, commercial establishments and private
homes with said law, rules and regulations requiring the construction or installment of
wastewater treatment facilities or hygienic septic tanks.
The aforementioned governors and mayors shall submit to the DILG on or before
December 31, 2011 their respective compliance reports which will contain the names
and addresses or offices of the owners of all the non-complying factories, commercial
establishments and private homes, copy furnished the concerned environmental
agency, be it the local DENR office or the Laguna Lake Development Authority.
The DILG is required to submit a five-year plan of action that will contain measures
intended to ensure compliance of all non-complying factories, commercial
establishments, and private homes.
On or before June 30, 2011, the DILG and the mayors of all cities in Metro Manila
shall consider providing land for the wastewater facilities of the Metropolitan
Waterworks and Sewerage System (MWSS) or its concessionaires (Maynilad and
Manila Water, Inc.) within their respective jurisdictions.
(3) The MWSS shall submit to the Court on or before June 30, 2011 the list of areas
in Metro Manila, Rizal and Cavite that do not have the necessary wastewater
treatment facilities. Within the same period, the concessionaires of the MWSS shall
submit their plans and projects for the construction of wastewater treatment facilities
in all the aforesaid areas and the completion period for said facilities, which shall not
go beyond 2037.
On or before June 30, 2011, the MWSS is further required to have its two
concessionaires submit a report on the amount collected as sewerage fees in their
respective areas of operation as of December 31, 2010.
(4) The Local Water Utilities Administration is ordered to submit on or before
September 30, 2011 its plan to provide, install, operate and maintain sewerage and
sanitation facilities in said cities and towns and the completion period for said works,
which shall be fully implemented by December 31, 2020.
(5) The Department of Agriculture (DA), through the Bureau of Fisheries and Aquatic
Resources, shall submit to the Court on or before June 30, 2011 a report on areas in
Manila Bay where marine life has to be restored or improved and the assistance it has
extended to the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga
and Bataan in developing the fisheries and aquatic resources in Manila Bay. The
report shall contain monitoring data on the marine life in said areas. Within the same
period, it shall submit its five-year plan to restore and improve the marine life in
Manila Bay, its future activities to assist the aforementioned LGUs for that purpose,
and the completion period for said undertakings.
The DA shall submit to the Court on or before September 30, 2011 the baseline data
as of September 30, 2010 on the pollution loading into the Manila Bay system from
agricultural and livestock sources.
(6) The Philippine Ports Authority (PPA) shall incorporate in its quarterly reports the
list of violators it has apprehended and the status of their cases. The PPA is further
ordered to include in its report the names, make and capacity of the ships that dock in
PPA ports. The PPA shall submit to the Court on or before June 30, 2011 the
measures it intends to undertake to implement its compliance with paragraph 7 of the
dispositive portion of the MMDA Decision and the completion dates of such
measures.
The PPA should include in its report the activities of its concessionaire that collects
and disposes of the solid and liquid wastes and other ship-generated wastes, which
shall state the names, make and capacity of the ships serviced by it since August
2003 up to the present date, the dates the ships docked at PPA ports, the number of
days the ship was at sea with the corresponding number of passengers and crew per
trip, the volume of solid, liquid and other wastes collected from said ships, the
treatment undertaken and the disposal site for said wastes.
(7) The Philippine National Police (PNP) Maritime Group shall submit on or before
June 30, 2011 its five-year plan of action on the measures and activities it intends to
undertake to apprehend the violators of Republic Act No. (RA) 8550 or the Philippine
Fisheries Code of 1998 and other pertinent laws, ordinances and regulations to
prevent marine pollution in Manila Bay and to ensure the successful prosecution of
violators.
The Philippine Coast Guard shall likewise submit on or before June 30, 2011 its fiveyear plan of action on the measures and activities they intend to undertake to
apprehend the violators of Presidential Decree No. 979 or the Marine Pollution
Decree of 1976 and RA 9993 or the Philippine Coast Guard Law of 2009 and other
pertinent laws and regulations to prevent marine pollution in Manila Bay and to ensure
the successful prosecution of violators.
(8) The Metropolitan Manila Development Authority (MMDA) shall submit to the Court
on or before June 30, 2011 the names and addresses of the informal settlers in Metro
Manila who, as of December 31, 2010, own and occupy houses, structures,
constructions and other encroachments established or built along the Pasig-MarikinaSan Juan Rivers, the NCR (Paraaque-Zapote, Las Pias) Rivers, the NavotasMalabon-Tullahan-Tenejeros Rivers, and connecting waterways and esteros, in
violation of RA 7279 and other applicable laws. On or before June 30, 2011, the
MMDA shall submit its plan for the removal of said informal settlers and the demolition
of the aforesaid houses, structures, constructions and encroachments, as well as the
completion dates for said activities, which shall be fully implemented not later than
December 31, 2015.
Region IV-A
8. Kalayaan (Longos), Laguna
9. Brgy. Sto. Nino, San Pablo City, Laguna
10. Brgy. San Antonio (Pilotage SLF), San Pedro, Laguna
11. Morong, Rizal
The MMDA is ordered to submit a status report, within thirty (30) days from receipt of
this Resolution, on the establishment of a sanitary landfill facility for Metro Manila in
compliance with the standards under RA 9003 or the Ecological Solid Waste
Management Act.
On or before June 30, 2011, the MMDA shall submit a report of the location of open
and controlled dumps in Metro Manila whose operations are illegal after February 21,
2006,3 pursuant to Secs. 36 and 37 of RA 9003, and its plan for the closure of these
open and controlled dumps to be accomplished not later than December 31, 2012.
Also, on or before June 30, 2011, the DENR Secretary, as Chairperson of the
National Solid Waste Management Commission (NSWMC), shall submit a report on
the location of all open and controlled dumps in Rizal, Cavite, Laguna, Bulacan,
Pampanga and Bataan.
On or before June 30, 2011, the DENR Secretary, in his capacity as NSWMC
Chairperson, shall submit a report on whether or not the following landfills strictly
comply with Secs. 41 and 42 of RA 9003 on the establishment and operation of
sanitary landfills, to wit:
National Capital Region
1. Navotas SLF (PhilEco), Brgy. Tanza (New Site), Navotas City
2. Payatas Controlled Dumpsite, Barangay Payatas, Quezon City
Region III
3. Sitio Coral, Brgy. Matictic, Norzagaray, Bulacan
12. Sitio Lukutan, Brgy. San Isidro, Rodriguez (Montalban), Rizal (ISWIMS)
13. Brgy. Pintong Bukawe, San Mateo, Rizal (SMSLFDC)
On or before June 30, 2011, the MMDA and the seventeen (17) LGUs in Metro Manila
are ordered to jointly submit a report on the average amount of garbage collected
monthly per district in all the cities in Metro Manila from January 2009 up to
December 31, 2010 vis--vis the average amount of garbage disposed monthly in
landfills and dumpsites. In its quarterly report for the last quarter of 2010 and
thereafter, MMDA shall report on the apprehensions for violations of the penal
provisions of RA 9003, RA 9275 and other laws on pollution for the said period.
On or before June 30, 2011, the DPWH and the LGUs in Rizal, Laguna, Cavite,
Bulacan, Pampanga, and Bataan shall submit the names and addresses of the
informal settlers in their respective areas who, as of September 30, 2010, own or
occupy houses, structures, constructions, and other encroachments built along the
Meycauayan-Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) River, the Imus
(Cavite) River, the Laguna de Bay, and other rivers, connecting waterways
and esteros that discharge wastewater into the Manila Bay, in breach of RA 7279 and
other applicable laws. On or before June 30, 2011, the DPWH and the aforesaid
LGUs shall jointly submit their plan for the removal of said informal settlers and the
demolition of the aforesaid structures, constructions and encroachments, as well as
the completion dates for such activities which shall be implemented not later than
December 31, 2012.
(9) The Department of Health (DOH) shall submit to the Court on or before June 30,
2011 the names and addresses of the owners of septic and sludge companies
including those that do not have the proper facilities for the treatment and disposal of
fecal sludge and sewage coming from septic tanks.
The DOH and DENR-Environmental Management Bureau shall develop a toxic and
hazardous waste management system by June 30, 2011 which will implement
segregation of hospital/toxic/hazardous wastes and prevent mixing with municipal
solid waste.
On or before June 30, 2011, the DOH shall submit a plan of action to ensure that the
said companies have proper disposal facilities and the completion dates of
compliance.1avvphi1
(10) The Department of Education (DepEd) shall submit to the Court on or before May
31, 2011 a report on the specific subjects on pollution prevention, waste
management, environmental protection, environmental laws and the like that it has
integrated into the school curricula in all levels for the school year 2011-2012.
On or before June 30, 2011, the DepEd shall also submit its plan of action to ensure
compliance of all the schools under its supervision with respect to the integration of
the aforementioned subjects in the school curricula which shall be fully implemented
by June 30, 2012.
(11) All the agencies are required to submit their quarterly reports electronically using
the forms below. The agencies may add other key performance indicators that they
have identified.
SO ORDERED.