Name: CALO, Michael John T.

Citation: LEAGUE OF CITIES OF THE PHILIPPINES v. COMELEC

Facts:

During the 12th Congress, Congress enacted into law RA 9009

amending Section 450 of the Local Government Code by increasing the
annual income requirement for conversion of a municipality into a city
from P20 million to P100 million to restrain the mad rush of
municipalities to convert into cities solely to secure a larger share in
the Internal Revenue Allotment despite the fact that they are incapable
of fiscal independence.

Prior to its enactment, a total of 57 municipalities had cityhood

bills pending in Congress. Congress did not act on 24 cityhood bills
during the 11th Congress.

During the 12th Congress, the House of Representatives adopted

Joint Resolution No. 29. This Resolution reached the Senate. However,
the 12th Congress adjourned without the Senate approving Joint
Resolution No. 29.

During the 13th Congress, 16 of the 24 municipalities mentioned

in the unapproved Joint Resolution No. 29 filed between November and
December of 2006, through their respective sponsors in Congress,
individual cityhood bills containing a common provision, as follows:

Exemption from Republic Act No. 9009. - The City of x x x shall

be exempted from the income requirement prescribed under
Republic Act No. 9009.
 These cityhood bills lapsed into law on various dates from March
to July 2007 after President Gloria Macapagal-Arroyo failed to sign
them.

Petitioners filed the present petitions to declare the Cityhood

Laws unconstitutional for violation of Section 10, Article X of the
Constitution, as well as for violation of the equal protection clause.
Petitioners also lament that the wholesale conversion of municipalities
into cities will reduce the share of existing cities in the Internal
Revenue Allotment because more cities will share the same amount of
internal revenue set aside for all cities under Section 285 of the Local
Government Code.

Issue: Whether or not the Cityhood Laws violate Section 10, Article X
of the Constitution and the equal protection clause

Held: Yes, the Cityhood Laws violate both the Constitution and the
equal protection clause

Ratio:

Section 10, Article X of the 1987 Constitution provides:

No province, city, municipality, or barangay shall be created,

divided, merged, abolished or its boundary substantially
altered, except in accordance with the criteria established
in the local government code and subject to approval by a
majority of the votes cast in a plebiscite in the political units
directly affected. (Emphasis supplied)

The Constitution is clear. The creation of local government units

must follow the criteria established in the Local Government
Code and not in any other law. There is only one Local Government
Code. The Constitution requires Congress to stipulate in the Local
Government Code all the criteria necessary for the creation of a city,
including the conversion of a municipality into a city. Congress cannot
write such criteria in any other law, like the Cityhood Laws.

Section 450 of the Local Government Code provides:

Section 450. Requisites for Creation. (a) A municipality or

a cluster of barangays may be converted into a component city if
it has a locally generated average annual income, as
certified by the Department of Finance, of at least One
hundred million pesos (P100,000,000.00) for the last two
(2) consecutive years based on 2000 constant prices, and
if it has either of the following requisites:

(i) a contiguous territory of at least one hundred (100)

square kilometers, as certified by the Land Management
Bureau; or

(ii) a population of not less than one hundred fifty thousand

(150,000) inhabitants, as certified by the National Statistics
Office.

The creation thereof shall not reduce the land area, population
and income of the original unit or units at the time of said
creation to less than the minimum requirements prescribed
herein.

(b) The territorial jurisdiction of a newly-created city shall be

properly identified by metes and bounds. The requirement on
 land area shall not apply where the city proposed to be created is
composed of one (1) or more islands. The territory need not be
contiguous if it comprises two (2) or more islands.

(c) The average annual income shall include the income accruing
to the general fund, exclusive of special funds, transfers, and
non-recurring income.

Thus, RA 9009 increased the income requirement for conversion

of a municipality into a city from P20 million toP100 million. Section
450 of the Local Government Code, as amended by RA 9009, does not
provide any exemption from the increased income requirement.

The equal protection clause of the 1987 Constitution permits a

valid classification under the following conditions:

1. The classification must rest on substantial distinctions;

2. The classification must be germane to the purpose of the law;

3. The classification must not be limited to existing conditions

only; and

4. The classification must apply equally to all members of the

same class.

Limiting the exemption only to the 16 municipalities violates the

requirement that the classification must apply to all similarly situated.
Municipalities with the same income as the 16 respondent
municipalities cannot convert into cities, while the 16 respondent
municipalities can. Clearly,as worded the exemption provision found in
the Cityhood Laws, even if it were written in Section 450 of the Local
Government Code, would still be unconstitutional for violation of the
equal protection clause.

*Other Source: League of Cities v COMELEC GR 176951

During the 11th Congress, 57 bills seeking the conversion of

municipalities into component cities were filed before the House of
Representatives. However, Congress acted only on 33 bills. It did not
act on bills converting 24 other municipalities into cities. During the
12th Congress, R.A. No. 9009 became effective revising Section 450 of
the Local Government Code. It increased the income requirement to
qualify for conversion into a city from P20 million annual income to
P100 million locally-generated income. In the 13th Congress, 16 of the
24 municipalities filed, through their respective sponsors, individual
cityhood bills. Each of the cityhood bills contained a common provision
exempting the particular municipality from the 100 million income
requirement imposed by R.A. No. 9009. Are the cityhood laws
converting 16 municipalities into cities constitutional?

SUGGESTED ANSWER:

November 18, 2008 Ruling

No. The SC (voting 6-5) ruled that the exemptions in the City
Laws is unconstitutional because sec. 10, Art. X of the Constitution
requires that such exemption must be written into the LGC and not into
any other laws. The Cityhood Laws violate sec. 6, Art. X of the
Constitution because they prevent a fair and just distribution of
the national taxes to local government units. The criteria, as
prescribed in sec. 450 of the LGC, must be strictly followed because
such criteria prescribed by law, are material in determining the just
share of local government units (LGUs) in national taxes. (League
of Cities of the Philippines v. Comelec GR No. 176951,
November 18, 2008)

March 31, 2009 Ruling

No. The SC denied the first Motion for Reconsideration. 7-5 vote.

April 28, 2009 Ruling

No. The SC En Banc, by a split vote (6-6), denied a second
motion for reconsideration.

December 21, 2009 Ruling

Yes. The SC (voting 6-4) reversed its November 18, 2008
decision and declared as constitutional the Cityhood Laws or Republic
Acts (RAs) converting 16 municipalities into cities. It said that based on
Congress deliberations and clear legislative intent was that the then
pending cityhood bills would be outside the pale of the minimum
income requirement of PhP100 million that Senate Bill No. 2159
proposes; and RA 9009 would not have any retroactive effect insofar as
the cityhood bills are concerned. The conversion of a municipality into
a city will only affect its status as a political unit, but not its property
as such, it added. The Court held that the favorable treatment
accorded the sixteen municipalities by the cityhood laws rests on
substantial distinction. The Court stressed that respondent LGUs were
qualified cityhood applicants before the enactment of RA 9009. To
impose on them the much higher income requirement after what they
have gone through would appear to be indeed unfair. Thus, the
imperatives of fairness dictate that they should be given a legal
remedy by which they should be allowed to prove that they have all
the necessary qualifications for city status using the criteria set forth
under the LGC of 1991 prior to its amendment by RA 9009. (GR No.
176951, League of Cities of the Philippines v. COMELEC; GR No.
177499, League of Cities of the Philippines v. COMELEC; GR No.
178056, League of Cities of the Philippines v. COMELEC,
December 21, 2009)
NOTE: The November 18, 2008 ruling already became final
and executory and was recorded in the SCs Book of Entries of
Judgments on May 21, 2009.)

August 24, 2010 Ruling

No. The SC (voting 7-6) granted the motions for reconsideration of the
League of Cities of the Philippines (LCP), et al. and reinstated its
November 18, 2008 decision declaring unconstitutional the Cityhood
Laws or Republic Acts (RAs) converting 16 municipalities into cities.
Undeniably, the 6-6 vote did not overrule the prior majority en banc
Decision of 18 November 2008, as well as the prior majority en banc
Resolution of 31 March 2009 denying reconsideration. The tie-vote on
the second motion for reconsideration is not the same as a tie-vote on
the main decision where there is no prior decision, the Court said. In
the latest resolution, the Court reiterated its November 18, 2008 ruling
that the Cityhood Laws violate sec. 10, Art. X of the Constitution which
expressly provides that no cityshall be createdexcept in
accordance with the criteria established in the local government code.
It stressed that while all the criteria for the creation of cities must be
embodied exclusively in the Local Government Code, the assailed
Cityhood Laws provided an exemption from the increased income
requirement for the creation of cities under sec. 450 of the LGC. The
unconstitutionality of the Cityhood Laws lies in the fact that Congress
provided an exemption contrary to the express language of the
Constitution.Congress exceeded and abused its law-making power,
rendering the challenged Cityhood Laws void for being violative of the
Constitution, the Court held.
The Court further held that limiting the exemption only to the
16 municipalities violates the requirement that the classification must
apply to all similarly situated. Municipalities with the same income as
the 16 respondent municipalities cannot convert into cities, while the
16 respondent municipalities can. Clearly, as worded the exemption
provision found in the Cityhood Laws, even if it were written in Section
450 of the Local Government Code, would still be unconstitutional for
violation of the equal protection clause. (GR No. 176951, League of
Cities of the Philippines v. Comelec; GR No. 177499, League of
Cities of the Philippines v. Comelec; GR No. 178056, League of
Cities of the Philippines v. Comelec, August 24, 2010)

February 15, 2011 Ruling

Yes, the laws are constitutional. The February 15, 2011 resolution is the
fourth ruling since the High Court first resolved the Cityhood case in
2008.

April 12, 2011Ruling

Yes! Its final. The 16 Cityhood Laws are constitutional. We should not
ever lose sight of the fact that the 16 cities covered by the Cityhood
Laws not only had conversion bills pending during the 11th Congress,
but have also complied with the requirements of the [Local
Government Code] LGC prescribed prior to its amendment by RA No.
9009. Congress undeniably gave these cities all the considerations that
justice and fair play demanded. Hence, this Court should do no less by
stamping its imprimatur to the clear and unmistakable legislative
intent and by duly recognizing the certain collective wisdom of
Congress, the SC said.
The Court stressed that Congress clearly intended that the local
government units covered by the Cityhood Laws be exempted from the
coverage of RA 9009, which imposes a higher income requirement of
PhP100 million for the creation of cities.
The Court reiterated that while RA 9009 was being deliberated
upon, the Congress was well aware of the pendency of conversion bills
of several municipalities, including those covered by the Cityhood
Laws. It pointed out that RA 9009 took effect on June 30, 2001, when
the 12th Congress was incipient. By reason of the clear legislative
intent to exempt the municipalities covered by the conversion bills
pending during the 11th Congress, the House of Representatives
adopted Joint Resolution No. 29 entitled Joint Resolution to Exempt
Certain Municipalities Embodied in Bills Filed in Congress before June
30, 2001 from the coverage of Republic Act No. 9009.
However, the Senate failed to act on the said Joint Resolution.
Even so, the House readopted Joint Resolution No. 29 as Joint
Resolution No. 1 during the 12th Congress, and forwarded the same for
approval to the Senate, which again failed to prove it. Eventually, the
conversion bills of respondents were individually filed in the Lower
House and were all unanimously and favorably voted upon. When
forwarded to the Senate, the bills were also unanimously approved.
The acts of both Chambers of Congress show that the exemption
clauses ultimately incorporated in the Cityhood Laws are but the
express articulations of the clear legislative intent to exempt the
respondents, without exception, from the coverage of RA No. 9009.
Thereby, RA 9009, and, by necessity, the LCG, were amended, not by
repeal but by way of the express exemptions being embodied in the
exemption clauses.
The Court held that the imposition of the income requirement of P100
million from local sources under RA 9009 was arbitrary. While the
Constitution mandates that the creation of local government units
must comply with the criteria laid down in the LGC, it cannot be
justified to insist that the Constitution must have to yield to every
amendment to the LGC despite such amendment imminently
producing effects contrary to the original thrusts of the LGC to promote
autonomy, decentralization, countryside development, and the
concomitant national growth.

Topic: Non-Delegation
Citation: People v Vera G.R. No. 45685. November 16, 1937.

Facts: Respondent herein, Hon. Jose O. Vera, is the Judge ad interim of

the seventh branch of the Court of First Instance of Manila, who heard
the application of the defendant Mariano Cu Unjieng for probation in
the aforesaid criminal case.

The Court of First Instance of Manila, on January 8, 1934, rendered a

judgment of conviction sentencing the defendant Mariano Cu Unjieng
to an indeterminate penalty ranging from four years and two months of
prision correccional to eight years of prison mayor, to pay the costs
and with reservation of civil action to the offended party, the Hongkong
and Shanghai Banking Corporation. Upon appeal, the court, on March
26, 1935, modified the sentence to an indeterminate penalty of from
five years and six months of prision correccional to seven years, six
months and twenty-seven days of prison mayor, but affirmed the
judgment in all other respects.

Evidence as to the circumstances under which said motion for leave

to intervene as amici curiae was signed and submitted to court was to
have been heard on August 19, 1937. But at this juncture, herein
petitioners came to this court on extraordinary legal process to put an
end to what they alleged was an interminable proceeding in the Court
of First Instance of Manila which fostered "the campaign of the
defendant Mariano Cu Unjieng for delay in the execution of the
sentence imposed by this Honorable Court on him, exposing the courts
to criticism and ridicule because of the apparent inability of the judicial
machinery to make effective a final judgment of this court imposed on
the defendant Mariano Cu Unjieng."

This court may review the actuations of the aforesaid Court of First
Instance in criminal case No. 42649 entitled "The People of the
Philippine Islands vs. Mariano Cu Unjieng, et al.", more particularly the
application of the defendant Mariano Cu Unjieng therein for probation
under the provisions of Act No. 4221, and thereafter prohibit the said
Court of First Instance from taking any further action or entertaining
further the aforementioned application for probation, to the end that
the defendant Mariano Cu Unjieng may be forthwith committed to
prison in accordance with the final judgment of conviction rendered by
this court in said case (G. R. No. 41200).

Issue: To support their petition for the issuance of the extraordinary

writs of certiorari and prohibition, herein petitioners allege that the
respondent judge has acted without jurisdiction or in excess of his
jurisdiction:
I. Because said respondent judge lacks the power to place
respondent Mariano Cu Unjieng under probation for the following
reasons:
 (1) Under section 11 of Act No. 4221, the said Act of the
Philippine Legislature is made to apply only to the provinces of the
Philippines; it nowhere states that it is to be made applicable to
chartered cities like the City of Manila.
(2) While section 37 of the Administrative Code contains a
proviso to the effect that in the absence of a special provision, the term
"province" may be construed to include the City of Manila for the
purpose of giving effect to laws of general application, it is also true
that Act No. 4221 is not a law of general application because it is made
to apply only to those provinces in which the respective provincial
boards shall have provided for the salary of a probation officer.
(3) Even if the City of Manila were considered to be a province,
still, Act No. 4221 would not be applicable to it because it has not
provided for the salary of a probation officer as required by section 11
thereof; it being immaterial that there is an Insular Probation Office
willing to act for the City of Manila, said Probation Office provided for in
section 10 of Act No. 4221 being different and distinct from the
Probation Officer provided for in section 11 of the same Act.

II. Because even if the respondent judge originally had jurisdiction

to entertain the application for probation of the respondent Mariano Cu
Unjieng, he nevertheless acted without jurisdiction or in excess thereof
in continuing to entertain the motion for reconsideration and by failing
to commit Mariano Cu Unjieng to prison after he had promulgated his
resolution of June 28, 1937, denying Mariano Cu Unjieng's application
for probation, for the reason that:
(1) His jurisdiction and power in probation proceedings is limited
by Act No. 4221 to the granting or denying of applications for
probation.
(2) After he had issued the order denying Mariano Cu Unjieng's
petition for probation on June 28, 1937, it became final and executory
at the moment of its rendition.
(3) No right of appeal exists in such cases.
(4) The respondent judge lacks the power to grant a rehearing of
said order or to modify or change the same.

III. Because the respondent judge made a finding that Mariano Cu

Unjieng is innocent of the crime for which he was convicted by final
judgment of this court, which finding is not only presumptuous but
without foundation in fact and in law, and is furthermore in contempt of
this court and a violation of the respondent's oath of office as ad
interim judge of first instance.
IV. Because the respondent judge has violated and continues to
violate his duty, which became imperative when he issued his order of
June 28, 1937, denying the application for probation, to commit his co-
respondent to jail.

In a supplementary petition filed on September 9, 1937, the

petitioner Hongkong and Shanghai Banking Corporation further
contends that Act No. 4221 of the Philippine Legislature providing for a
system of probation for persons eighteen years of age or over who are
convicted of crime, is unconstitutional because it is violative of section
1, subsection (1), Article III, of the Constitution of the Philippines
guaranteeing equal protection of the laws because it confers upon the
provincial board of each province the absolute discretion to make said
law operative

Held: Act No. 4221 is hereby declared unconstitutional and void and
the writ of prohibition is, accordingly, granted. Without any
pronouncement regarding costs. So ordered.
Ratio: The constitutionality of Act No. 4221 is challenged on three
principal grounds: (1) That said Act encroaches upon the pardoning
power of the Executive; (2) that it constitutes an undue delegation of
legislative power; and (3) that it denies the equal protection of the
laws.

Under the Probation Act, the probationer's case is not terminated by

the mere fact that he is placed on probation. Section 4 of the Act
provides that the probation may be definitely terminated and the
probationer finally discharged from supervision only after the period of
probation shall have been terminated and the probation officer shall
have submitted a report, and the court shall have found that the
probationer has complied with the conditions of probation. The
probationer, then, during the period of probation, remains in legal
custody subject to the control of the probation officer and of the
court; and, he may be rearrested upon the non-fulfillment of the
conditions of probation and, when rearrested, may be committed to
prison to serve the sentence originally imposed upon him.

A 'pardon' is an act of grace, proceeding from the power intrusted

with the execution of the laws which exempts the individual on whom it
is bestowed from the punishment the law inflicts for a crime he has
committed. It is a remission of guilt or a forgiveness of the offense.
'Commutation' is a remission of a part of the punishment; a
substitution of a less penalty for the one originally imposed. A
'reprieve' or 'respite' is the withholding of a sentence for an interval of
time, a postponement of execution, a temporary suspension of
execution.

We are of the opinion that section 11 of the Probation Act is

unconstitutional and void because it is also repugnant to the equal-
protection clause of our Constitution. Section 11 of the Probation Act
being unconstitutional and void for the reasons already stated, the
next inquiry is whether or not the entire Act should be avoided. It is
also contended that the Probation Act violates the provision of our Bill
of Rights which prohibits the denial to any person of the equal
protection of the laws. We conclude that section 11 of Act No. 4221
constitutes an improper and unlawful delegation of legislative authority
to the provincial boards and is, for this reason, unconstitutional and
void.

In view of the Courts discretion

"By the Code of Civil Procedure of the Philippine Islands, section
516, the Philippine supreme court is granted concurrent jurisdiction in
prohibition with courts of first instance over inferior tribunals or
persons, and original jurisdiction over courts of first instance, when
such courts are exercising functions without or in excess of their
jurisdiction. It has been held by that Court that the question of the
validity of a criminal statute must usually be raised by a defendant in
the trial court and be carried regularly in review to the Supreme Court.
But in this case where a new act seriously affected numerous persons
and extensive property rights, and was likely to cause a multiplicity of
actions, the Supreme Court exercised its discretion to bring the issue of
the act's validity promptly before it and decide it in the interest of the
orderly administration of justice.

Both petitioners and respondents are correct, therefore, when they

argue that a Court of First Instance sitting in probation proceedings is a
court of limited jurisdiction. Its jurisdiction in such proceedings is
conferred exclusively by Act No. 4221 of the Philippine Legislature.
In view of Governmental Standing
And on the hypothesis that the Hongkong & Shanghai Banking
Corporation, represented by the private prosecution, is not the proper
party to raise the constitutional question here a point we do not now
have to decide we are of the opinion that the People of the
Philippines, represented by the Solicitor-General and the Fiscal of the
City of Manila, is such a proper party in the present proceedings. The
unchallenged rule is that the person who impugns the validity of a
statute must have a personal and substantial interest in the case such
that he has sustained, or will sustain, direct injury as a result of its
enforcement. It goes without saying that if Act No. 4221 really violates
the Constitution, the People of the Philippines, in whose name the
present action is brought, has a substantial interest in having it set
aside.

". . . The idea seems to be that the people are estopped from
questioning the validity of a law enacted by their representatives; that
to an accusation by the people of Michigan of usurpation upon their
government, a statute enacted by the people of Michigan is an
adequate answer. The last proposition is true, but, if the statute relied
on in justification is unconstitutional, it is a statute only in form, and
lacks the force of law, and is of no more saving effect to justify action
under it than if it had never been enacted.

". . . The state is a proper party indeed, the proper party to

bring this action. The state is always interested where the integrity of
its Constitution or statutes is involved.

The respondents do not seem to doubt seriously the correctness of

the general proposition that the state may impugn the validity of its
laws. They have not cited any authority running clearly in the opposite
direction. In fact, they appear to have proceeded on the assumption
that the rule as stated is sound but that it has no application in the
present case, nor may it be invoked by the City Fiscal in behalf of the
People of the Philippines, one of the petitioners herein, the principal
reasons being that the validity of the Probation Act cannot be attacked
for the first time before this court, that the City Fiscal is estopped from
attacking the validity of the Act and, not being authorized to enforce
laws outside of the City of Manila, cannot challenge the validity of the
Act in its application outside said city.

Apart from the foregoing considerations, this court will also take
cognizance of the fact that the Probation Act is a new addition to our
statute books and its validity has never before been passed upon by
the courts; that many persons accused and convicted of crime in the
City of Manila have applied for probation; that some of them are
already on probation; that more people will likely take advantage of the
Probation Act in the future; and that the respondent Mariano Cu
Unjieng has been at large for a period of about four years since his first
conviction.

In view of confict with Executive Power

We conclude that the Probation Act does not conflict with the
pardoning power of the Executive. The pardoning power, in respect to
those serving their probationary sentences, remains as full and
complete as if the Probation Law had never been enacted. The
President may yet pardon the probationer and thus place it beyond the
power of the court to order his rearrest and imprisonment.
In view of the applicability of the Probation Act

"In seeking the legislative intent, the presumption is against any

mutilation of a statute, and the courts will resort to elimination only
where an unconstitutional provision is interjected into a statute
otherwise valid, and is so independent and separable that its removal
will leave the constitutional features and purposes of the act
substantially unaffected by the process."

It is contended that even if section 11, which makes the Probation

Act applicable only in those provinces in which the respective
provincial boards have provided for the salaries of probation officers
were inoperative on constitutional grounds, the remainder of the Act
would still be valid and may be enforced.

The welfare of society is its chief end and aim. The benefit to the
individual convict is merely incidental. But while we believe that
probation is commendable as a system and its implantation into the
Philippines should be welcomed, we are forced by our inescapable duty
to set the law aside because of repugnancy to our fundamental law. In
arriving at this conclusion, we have endeavored to consider the
different aspects presented by able counsel for both parties, as well in
their memorandums as in their oral argument. We have examined the
cases brought to our attention, and others we have been able to reach
in the short time at our command for the study and deliberation of this
case. In the examination of the cases and in the analysis of the legal
principles involved we have inclined to adopt the line of action which in
our opinion, is supported by better reasoned.
authorities and is more conducive to the general welfare. (Smith, Bell &
Co. vs. Natividad [1919], 40 Phil., 136.) Realizing the conflict of
authorities, we have declined to be bound by certain adjudicated cases
brought to our attention, except where the point or the principle is
settled directly or by clear implication by the more authoritative
pronouncements of the Supreme Court of the United States.

In view of respondent's defense

As special defenses, respondents allege:
(1) That the present petition does not state facts sufficient in law to
warrant the issuance of the writ of certiorari or of prohibition.
(2) That the aforesaid petition is premature because the remedy
sought by the petitioners is the very same remedy prayed for by them
before the trial court and was still pending resolution before the trial
court when the present petition was filed with this court.
(3) That the petitioners having themselves raised the question as to
the execution of judgment before the trial court, said trial court has
acquired exclusive jurisdiction to resolve the same under the theory
that its resolution denying probation is unappealable.
(4) That upon the hypothesis that this court has concurrent
jurisdiction with the Court of First Instance to decide the question as to
whether or not execution will lie, this court nevertheless cannot
exercise said jurisdiction while the Court of First Instance has assumed
jurisdiction over the same upon motion of herein petitioners
themselves.
(5) That the procedure followed by the herein petitioners in seeking
to deprive the trial court of its jurisdiction over the case and elevate
the proceedings to this court, should not be tolerated because it
impairs the authority and dignity of the trial court which court while
sitting in probation cases is "a court of limited jurisdiction but of great
dignity."
(6) That, under the supposition that this court has jurisdiction to
resolve the question submitted to and pending resolution by the trial
court, the present action would not lie because the resolution of the
trial court denying probation is appealable; for although the Probation
Law does not specifically provide that an applicant for probation may
appeal from a resolution of the Court of First Instance denying
probation, still it is a general rule in this jurisdiction that a final order,
resolution or decision of an inferior court is appealable to the superior
court.
(7) That the resolution of the trial court denying probation of herein
respondent Mariano Cu Unjieng being appealable, the same had not
yet become final and executory for the reason that the said respondent
had filed an alternative motion for reconsideration and new trial within
the requisite period of fifteen days, which motion the trial court was
not able to resolve in view of the restraining order improvidently and
erroneously issued by this court.
(8) That the Fiscal of the City of Manila had by implication admitted
that the resolution of the trial court denying probation is not final and
unappealable when he presented his answer to the motion for
reconsideration and agreed to the postponement of the hearing of the
said motion.
(9) That under the supposition that the order of the trial court
denying probation is not appealable, it is incumbent upon the accused
to file an action for the issuance of the writ of certiorari with
mandamus, it appearing that the trial court, although it believed that
the accused was entitled to probation, nevertheless denied probation
for fear of criticism because the accused is a rich man; and that, before
a petition for certiorari grounded on an irregular exercise of jurisdiction
by the trial court could lie, it is incumbent upon the petitioner to file a
motion for reconsideration specifying the error committed so that the
trial court could have. an opportunity to correct or cure the same.
(10) That on the hypothesis that the resolution of the trial court is not
appealable, the trial court retains its jurisdiction within a reasonable
time to correct or modify it in accordance with law and justice; that this
power to alter or modify an order or resolution is inherent in the courts
and may be exercised either motu proprio or upon petition of the
proper party, the petition in the latter case taking the form of a motion
for reconsideration.
(11) That on the hypothesis that the resolution of the trial court is
appealable as respondents allege, said court cannot order execution of
the same while it is on appeal, for then the appeal would not be
availing because the doors of probation would be closed from the
moment the accused commences to serve his sentence.

United States v. Ang Tang Ho | Johns, J. (1922)

FACTS

The Philippine Legislature passed Act No. 2868, which authorized

the Governor-General, for any cause, or conditions resulting in an
extraordinary rise in the price of palay, rice or corn, to issue and
promulgate, with the consent of the Council of State, temporary
rules and emergency measures for carring out the purposes of
the Act.
 Governor-General issued Executive Order No. 53, fixing the price
at which rice should be sold at Php0.63 per ganta.
A complaint was filed against Ang Tang Ho for the violation of EO
No. 53, for having sold to one Pedro Trinidad 1 ganta of rice for
Php0.80.
TC: found Ang Tang Ho guilty and sentenced to 5 months
imprisonment and to pay Php500.

ISSUE/HELD
WoN Act No. 2868 delegates legislative power to the Governor-
General, in authorizing the him to fix the price at which price
should be sold.YES. Act No. 2868 was an undue delegation of
legislative power to the Governor-General.
Ang Tang Ho argues that the lower court erred in finiding that EO
No.53 was of any fore and effect, as the basis of the offense
charged.

RATIO

The Legislature cannot delegate the power to enact any law. By

the Organic Law, legislative power is vested solely in the
Legislature, and such power to make laws cannot be delegated
to the Governor-General or anyone else.
There are two possible interpretations of Act No. 2868:
o If the Act is a law within itself and does nothing more than
to authorize the Governor-General to make rules and
regulations to carry the law into effect, then the Act is
VALID.
o However, if the Act within itself is not a law nor does it
define a crime, and some legislative act remains to be
done to make it a law or a crime, and the doing of such act
 is vested in the Governor-General, then the Act is a
delegation of legislative power and is UNCONSTITUTIONAL
and VOID.
The law must be complete in all its terms and provisions when it
leaves the legislative and nothing must be left to the judgment of
the appointees or delegates of the legislature.
Although the legislature cannot delegate its power to make a
law, it can make a law to delegate a power to determine
some fact or state of things upon which the law makes or
intends to make, its own action to depend.
However, this is not the case in Act No. 2868 in authorizing the
Governor-General for any cause, or conditions resulting in an
extraordinary rise in the price of palay, rice or corn, to issue and
promulgate, with the consent of the Council of State, temporary
rules and emergency measures for carrying out the purposes of
the Act.
o The Legislature itself does NOT in any manner specify or
define any basis for the order, and has left it to the sole
discretion of the Governor-General to determine what is a
cause, what is an extraordinary rise in the price or rice,
and what is a temporary rule or emergency measure,
including the conditions to fix the price, without regard to
grade or quality, and how long it should be enforce and
when it should be extended.
Therefore, it was the violation of the proclamation of the
Governor-General which constituted the crime, and not the law
itself; as without such proclamation, it would not have been a
crime to sell the rice at whatever price the seller pleased (even
at P0.80 per ganta)

DISPOSITIVE
Act No. 2868 in so far as it authorizes the Governor-General in his
discretion to issue a proclamation, fixing the price of rice and make the
sale in violation of the proclamation a crime, is a delegation of
legislative power in violation of the Organic Law, and is thus,
unconstitutional and void.

Citation: Eastern Shipping Lines v. POEA 166 SCRA 533 (1988)

GENERAL RULE: Non-delegation of Legislative Power

EXCEPTION: Subordinate Legislation
Tests for Valid Delegation of Legislative Power
FACTS:

Vitaliano Saco, the Chief Officer of a ship, was killed in an accident in

Tokyo, Japan. The widow filed a complaint for damages against the
Eastern Shipping Lines with the POEA, based on Memorandum Circular
No. 2 issued by the latter which stipulated death benefits and burial
expenses for the family of an overseas worker. Eastern Shipping Lines
questioned the validity of the memorandum circular. Nevertheless, the
POEA assumed jurisdiction and decided the case.

ISSUE:

W/N the issuance of Memorandum Circular No. 2 is a violation

of non-delegation of powers

HELD:

SC held that there was valid delegation of powers.

In questioning the validity of the memorandum circular, Eastern

Shipping Lines contended that POEA was given no authority to
promulgate the regulation, and even with such authorization, the
regulation represents an exercise of legislative discretion which, under
the principle, is not subject to delegation.

GENERAL RULE: Non-delegation of powers; exception

It is true that legislative discretion as to the substantive contents of the

law cannot be delegated. What can be delegated is the discretion to
determine how the law may be enforced, not what the law shall be.
The ascertainment of the latter subject is a prerogative of the
legislature. This prerogative cannot be abdicated or surrendered by the
legislature to the delegate.

Two Tests of Valid Delegation of Legislative Power

There are two accepted tests to determine whether or not there is a

valid delegation of legislative power, viz, the completeness test and
the sufficient standard test. Under the first test (Completeness
test), the law must be complete in all its terms and conditions when it
leaves the legislature such that when it reaches the delegate the only
thing he will have to do is to enforce it.

Under the sufficient standard test, there must be adequate

guidelines or stations in the law to map out the boundaries of the
delegates authority and prevent the delegation from running riot.

Both tests are intended to prevent a total transference of legislative

authority to the delegate, who is not allowed to step into the shoes of
the legislature and exercise a power essentially legislative.

Xxx The delegation of legislative power has become the rule and its
non-delegation the exception.

Rationale for Delegation of Legislative Power

The reason is the increasing complexity of the task of government and

the growing inability of the legislature to cope directly with the myriad
problems demanding its attention. The growth of society has ramified
its activities and created peculiar and sophisticated problems that the
legislature cannot be expected to reasonably comprehend.
Specialization even in legislation has become necessary. Too many of
the problems attendant upon present-day undertakings, the legislature
may not have the competence to provide the required direct and
efficacious, not to say, specific solutions. These solutions may,
however, be expected from its delegates, who are supposed to be
experts in the particular fields.

Power of Subordinate Legislation

The reasons given above for the delegation of legislative powers in

general are particularly applicable to administrative bodies. With the
proliferation of specialized activities and their attendant peculiar
problems, the national legislature has found it more and more
necessary to entrust to administrative agencies the authority to issue
rules to carry out the general provisions of the statute. This is called
the power of subordinate legislation.

With this power, administrative bodies may implement the broad

policies laid down in statute by filling in the details which the
Congress may not have the opportunity or competence to provide.
Memorandum Circular No. 2 is one such administrative regulation.

Citation: Pelaez v Auditor-General G.R. No. L-23825 December

24, 1965

FACTS:

During the period from September 4 to October 29, 1964 the President
of the Philippines, purporting to act pursuant to Section 68 of the
Revised Administrative Code, issued Executive Orders Nos. 93 to 121,
124 and 126 to 129; creating thirty-three (33) municipalities
enumerated in the margin. Soon after the date last mentioned, or on
November 10, 1964 petitioner Emmanuel Pelaez, as Vice President of
the Philippines and as taxpayer, instituted the present special civil
action, for a writ of prohibition with preliminary injunction, against the
Auditor General, to restrain him, as well as his representatives and
agents, from passing in audit any expenditure of public funds in
implementation of said executive orders and/or any disbursement by
said municipalities.

Petitioner alleges that said executive orders are null and void, upon the
ground that said Section 68 has been impliedly repealed by Republic
Act No. 2370 effective January 1, 1960 and constitutes an undue
delegation of legislative power. The third paragraph of Section 3 of
Republic Act No. 2370, reads:

Barrios shall not be created or their boundaries altered nor their names
changed except under the provisions of this Act or by Act of Congress.
Respondent herein relies upon Municipality of Cardona vs. Municipality
of Binagonan

ISSUE: W/N the President, who under this new law cannot even create
a barrio, can create a municipality which is composed of several
barrios, since barrios are units of municipalities

HELD: On Cardona vs Municipality of Binangonan, such claim is

untenable, for said case involved, not the creation of a new
municipality, but a mere transfer of territory from an already
existing municipality (Cardona) to another municipality (Binagonan),
likewise, existing at the time of and prior to said transfer. It is obvious,
however, that, whereas the power to fix such common boundary, in
order to avoid or settle conflicts of jurisdiction between adjoining
municipalities, may partake of an administrative nature involving, as
it does, the adoption of means and ways to carry into effect the law
creating said municipalities the authority to create municipal
corporations is essentially legislative in nature. In the language of
other courts, it is strictly a legislative function or solely and
exclusively the exercise of legislative power

Although Congress may delegate to another branch of the Government

the power to fill in the details in the execution, enforcement or
administration of a law, it is essential, to forestall a violation of the
principle of separation of powers, that said law:

(a) be complete in itself it must set forth therein the policy

to be executed, carried out or implemented by the delegate2
and

(b) fix a standard the limits of which are sufficiently

determinate or determinable to which the delegate must
conform in the performance of his functions.

Indeed, without a statutory declaration of policy, the delegate would in

effect, make or formulate such policy, which is the essence of every
law; and, without the aforementioned standard, there would be no
means to determine, with reasonable certainty, whether the delegate
has acted within or beyond the scope of his authority. Hence, he could
thereby arrogate upon himself the power, not only to make the law,
but, also and this is worse to unmake it, by adopting measures
inconsistent with the end sought to be attained by the Act of Congress,
thus nullifying the principle of separation of powers and the system of
checks and balances, and, consequently, undermining the very
foundation of our Republican system.

Section 68 of the Revised Administrative Code does not meet these

well settled requirements for a valid delegation of the power to fix the
details in the enforcement of a law. It does not enunciate any policy to
be carried out or implemented by the President. Neither does it give a
standard sufficiently precise to avoid the evil effects above referred to.

The power of control under the provision Section 10 (1) of Article VII of
the Constitution implies the right of the President to interfere in the
exercise of such discretion as may be vested by law in the officers of
the executive departments, bureaus, or offices of the national
government, as well as to act in lieu of such officers. This power is
denied by the Constitution to the Executive, insofar as local
governments are concerned. With respect to the latter, the
fundamental law permits him to wield no more authority than that of
checking whether said local governments or the officers thereof
perform their duties as provided by statutory enactments.

Hence, the President cannot interfere with local governments, so long

as the same or its officers act Within the scope of their authority. He
may not enact an ordinance which the municipal council has failed or
refused to pass, even if it had thereby violated a duty imposed thereto
by law, although he may see to it that the corresponding provincial
officials take appropriate disciplinary action therefor. Neither may he
vote, set aside or annul an ordinance passed by said council within the
scope of its jurisdiction, no matter how patently unwise it may be. He
may not even suspend an elective official of a regular municipality or
take any disciplinary action against him, except on appeal from a
decision of the corresponding provincial board.

Upon the other hand if the President could create a

municipality, he could, in effect, remove any of its officials, by
creating a new municipality and including therein the barrio in
which the official concerned resides, for his office would
thereby become vacant. Thus, by merely brandishing the
power to create a new municipality (if he had it), without
actually creating it, he could compel local officials to submit to
his dictation, thereby, in effect, exercising over them the
power of control denied to him by the Constitution.

Citation: Tatad v. Executive Secretary, G.R. No. 124360,

November 5, 1997
 DECISION
(En Banc)

PUNO, J.:

I. THE FACTS

Petitioners assailed 5(b) and 15 of R.A. No. 8180, the Downstream Oil
Industry Deregulation Act of 1996.

5(b) of the law provided that tariff duty shall be imposed . . . on

imported crude oil at the rate of three percent (3%) and imported
refined petroleum products at the rate of seven percent (7%) . . . On
the other hand, 15 provided that [t]he DOE shall, upon approval of
the President, implement the full deregulation of the downstream oil
industry not later than March 1997. As far as practicable, the DOE shall
time the full deregulation when the prices of crude oil and petroleum
products in the world market are declining and when the exchange
rate of the peso in relation to the US dollar is stable . . .

Petitioners argued that 5(b) on tariff differential violates the

provision of the Constitution requiring every law to have only one
subject which should be expressed in its title.

They also contended that the phrases as far as practicable, decline

of crude oil prices in the world market and stability of the peso
exchange rate to the US dollar are ambivalent, unclear and inconcrete
since they do not provide determinate or determinable standards that
can guide the President in his decision to fully deregulate the
downstream oil industry.
Petitioners also assailed the Presidents E.O. No. 392, which proclaimed
the full deregulation of the downstream oil industry in February 1997.
They argued that the Executive misapplied R.A. No. 8180 when it
considered the depletion of the OPSF fund as a factor in the
implementation of full deregulation.

Finally, they asserted that the law violated 19, Article XII of the
Constitution prohibiting monopolies, combinations in restraint of trade
and unfair competition

II. THE ISSUES

1. Did 5(b) violate the one title-one subject requirement of the

Constitution?
2. Did 15 violate the constitutional prohibition on undue delegation
of power?
3. Was E.O. No. 392 arbitrary and unreasonable?
4. Did R.A. No. 8180 violate 19, Article XII of the Constitution
prohibiting monopolies, combinations in restraint of trade and unfair
competition?

III. THE RULING

[The Court GRANTED the petition. It DECLARED R.A. No. 8180

unconstitutional and E.O. No. 372 void.]

1. NO, 5(b) DID NOT violate the one title-one subject

requirement of the Constitution.

As a policy, this Court has adopted a liberal construction of the one

title-one subject rule. [T]he title need not mirror, fully index or
catalogue all contents and minute details of a law. A law having a
single general subject indicated in the title may contain any number of
provisions, no matter how diverse they may be, so long as they are not
inconsistent with or foreign to the general subject, and may be
considered in furtherance of such subject by providing for the method
and means of carrying out the general subject. [S]ection 5(b) providing
for tariff differential is germane to the subject of R.A. No. 8180 which is
the deregulation of the downstream oil industry. The section is
supposed to sway prospective investors to put up refineries in our
country and make them rely less on imported petroleum.

2. NO, 15 DID NOT violate the constitutional prohibition on

undue delegation of power.

Two tests have been developed to determine whether the delegation of

the power to execute laws does not involve the abdication of the power
to make law itself. We delineated the metes and bounds of these tests
in Eastern Shipping Lines, Inc. VS. POEA, thus:
There are two accepted tests to determine whether or not there is a
valid delegation of legislative power, viz: the completeness test and
the sufficient standard test. Under the first test, the law must be
complete in all its terms and conditions when it leaves the legislative
such that when it reaches the delegate the only thing he will have to
do is to enforce it. Under the sufficient standard test, there must be
adequate guidelines or limitations in the law to map out the boundaries
of the delegate's authority and prevent the delegation from running
riot. Both tests are intended to prevent a total transference of
legislative authority to the delegate, who is not allowed to step into the
shoes of the legislature and exercise a power essentially legislative.
xxx xxx xxx

Section 15 can hurdle both the completeness test and the sufficient
standard test. It will be noted that Congress expressly provided in R.A.
No. 8180 that full deregulation will start at the end of March 1997,
regardless of the occurrence of any event. Full deregulation at the end
of March 1997 is mandatory and the Executive has no discretion to
postpone it for any purported reason. Thus, the law is complete on the
question of the final date of full deregulation. The discretion given to
the President is to advance the date of full deregulation before the end
of March 1997. Section 15 lays down the standard to guide the
judgment of the President --- he is to time it as far as practicable
when the prices of crude oil and petroleum products in the world
market are declining and when the exchange rate of the peso in
relation to the US dollar is stable.

Petitioners contend that the words as far as practicable, declining

and stable should have been defined in R.A. No. 8180 as they do not
set determinate or determinable standards. The stubborn submission
deserves scant consideration. The dictionary meanings of these words
are well settled and cannot confuse men of reasonable intelligence.
Webster defines practicable as meaning possible to practice or
perform, decline as meaning to take a downward direction, and
stable as meaning firmly established. The fear of petitioners that
these words will result in the exercise of executive discretion that will
run riot is thus groundless. To be sure, the Court has sustained the
validity of similar, if not more general standards in other cases.

3. YES, E.O. No. 392 was arbitrary and unreasonable.

A perusal of section 15 of R.A. No. 8180 will readily reveal that it only
enumerated two factors to be considered by the Department of Energy
and the Office of the President, viz.: (1) the time when the prices of
crude oil and petroleum products in the world market are declining,
and (2) the time when the exchange rate of the peso in relation to the
US dollar is stable. Section 15 did not mention the depletion of the
OPSF as a factor to be given weight by the Executive before ordering
full deregulation. On the contrary, the debates in Congress will show
that some of our legislators wanted to impose as a pre-condition to
deregulation a showing that the OPSF fund must not be in deficit. We
therefore hold that the Executive department failed to follow faithfully
the standards set by R.A. No. 8180 when it considered the extraneous
factor of depletion of the OPSF fund. The misappreciation of this extra
factor cannot be justified on the ground that the Executive department
considered anyway the stability of the prices of crude oil in the world
market and the stability of the exchange rate of the peso to the
dollar. By considering another factor to hasten full deregulation, the
Executive department rewrote the standards set forth in R.A. 8180.
The Executive is bereft of any right to alter either by subtraction or
addition the standards set in R.A. No. 8180 for it has no power to make
laws. To cede to the Executive the power to make law is to invite
tyranny, indeed, to transgress the principle of separation of powers.
The exercise of delegated power is given a strict scrutiny by courts for
the delegate is a mere agent whose action cannot infringe the terms of
agency. In the cases at bar, the Executive co-mingled the factor of
depletion of the OPSF fund with the factors of decline of the price of
crude oil in the world market and the stability of the peso to the US
dollar. On the basis of the text of E.O. No. 392, it is impossible to
determine the weight given by the Executive department to the
depletion of the OPSF fund. It could well be the principal consideration
for the early deregulation. It could have been accorded an equal
significance. Or its importance could be nil. In light of this
uncertainty, we rule that the early deregulation under E.O. No. 392
constitutes a misapplication of R.A. No. 8180.

4. YES, R.A. No. 8180 violated 19, Article XII of the

Constitution prohibiting monopolies, combinations in restraint
of trade and unfair competition.

[I]t cannot be denied that our downstream oil industry is operated and
controlled by an oligopoly, a foreign oligopoly at that. Petron, Shell and
Caltex stand as the only major league players in the oil market. All
other players belong to the lilliputian league. As the dominant players,
Petron, Shell and Caltex boast of existing refineries of various
capacities. The tariff differential of 4% therefore works to their
immense benefit. Yet, this is only one edge of the tariff differential. The
other edge cuts and cuts deep in the heart of their competitors. It
erects a high barrier to the entry of new players. New players that
intend to equalize the market power of Petron, Shell and Caltex by
building refineries of their own will have to spend billions of pesos.
Those who will not build refineries but compete with them will suffer
the huge disadvantage of increasing their product cost by 4%. They
will be competing on an uneven field. The argument that the 4% tariff
differential is desirable because it will induce prospective players to
invest in refineries puts the cart before the horse. The first need is to
attract new players and they cannot be attracted by burdening them
with heavy disincentives. Without new players belonging to the league
of Petron, Shell and Caltex, competition in our downstream oil industry
is an idle dream.

The provision on inventory widens the balance of advantage of Petron,

Shell and Caltex against prospective new players. Petron, Shell and
Caltex can easily comply with the inventory requirement of R.A. No.
8180 in view of their existing storage facilities. Prospective competitors
again will find compliance with this requirement difficult as it will entail
a prohibitive cost. The construction cost of storage facilities and the
cost of inventory can thus scare prospective players. Their net effect is
to further occlude the entry points of new players, dampen competition
and enhance the control of the market by the three (3) existing oil
companies.

Finally, we come to the provision on predatory pricing which is defined

as . . . selling or offering to sell any product at a price unreasonably
below the industry average cost so as to attract customers to the
detriment of competitors. Respondents contend that this provision
works against Petron, Shell and Caltex and protects new entrants. The
ban on predatory pricing cannot be analyzed in isolation. Its validity is
interlocked with the barriers imposed by R.A. No. 8180 on the entry of
new players. The inquiry should be to determine whether predatory
pricing on the part of the dominant oil companies is encouraged by the
provisions in the law blocking the entry of new players. Text-
writer Hovenkamp gives the authoritative answer and we quote:
xxx xxx xxx
The rationale for predatory pricing is the sustaining of losses today that
will give a firm monopoly profits in the future. The monopoly profits will
never materialize, however, if the market is flooded with new entrants
as soon as the successful predator attempts to raise its
price. Predatory pricing will be profitable only if the market contains
significant barriers to new entry.

As aforediscussed, the 4% tariff differential and the inventory

requirement are significant barriers which discourage new players to
enter the market. Considering these significant barriers established by
R.A. No. 8180 and the lack of players with the comparable clout of
PETRON, SHELL and CALTEX, the temptation for a dominant player to
engage in predatory pricing and succeed is a chilling reality.
Petitioners charge that this provision on predatory pricing is anti-
competitive is not without reason.

[R.A. No. 8180 contained a separability clause, but the High Tribunal
held that the offending provisions of the law so permeated its essence
that it had to be struck down entirely. The provisions on tariff
differential, inventory and predatory pricing were among the principal
props of R.A. No. 8180. Congress could not have deregulated the
downstream oil industry without these provisions.]
Citation: Kilusang Mayo Uno Labor Center v. Jesus Garcia, Jr.,
LTFRB, Provincial Bus Operators Association of the Philippines
(PBOAP)
G.R. No. 115381 December 23, 1994

Kapunan, J.

FACTS:

public utilities privately owned and operated businesses whose

service are essential to the general public; enterprises which specially
cater to the needs of the public and conducive to their comfort and
convenience

DOTC Sec. issued Memorandum Circular No. 90-395 to then LTFRB

Chairman allowing provincial bus operators to charge passengers rates
within a range of 15% above and 15% below the LTFRB official rate for
a period of 1 year

PBOAP pursuant to Memo. Cir. it filed an application for fare rate

increase. An across-the-board increase of eight and a half centavos
(P0.085) per kilometer for all types of provincial buses with a
minimum-maximum fare range of fifteen (15%) percent over and below
the proposed basic per kilometer fare rate, with the said minimum-
maximum fare range applying only to ordinary, first class and premium
class buses and a fifty-centavo (P0.50) minimum per kilometer fare for
aircon buses, was sought

respondent LTFRB rendered a decision granting the fare rate increase

in accordance with a specified schedule of fares on a straight
computation method
DOTC Sec. issued Department Order No. 92-587 defining the policy
framework on the regulation of transport services. It provides inter alia
that Passenger fares shall also be deregulated, except for the lowest
class of passenger service (normally third class passenger transport)
for which the government will fix indicative or reference fares.

Operators of particular services may fix their own fares within a range
15% above and below the indicative or reference rate.

LTFRB issued Memorandum Circular No. 92-009 promulgating the

guidelines for the implementation of DOTC Department Order No. 92-
587, which provides, among others, that:

The issuance of a Certificate of Public Convenience is determined by

public need. The presumption of public need for a service shall be
deemed in favor of the applicant, while burden of proving that there is
no need for the proposed service shall be the oppositors.
The existing authorized fare range system of plus or minus 15 per
cent for provincial buses and jeepneys shall be widened to 20% and
-25% limit in 1994 with the authorized fare to be replaced by an
indicative or reference rate as the basis for the expanded fare range

PBOAP - availing itself of the deregulation policy of the DOTC allowing

provincial bus operators to collect plus 20% and minus 25% of the
prescribed fare without first having filed a petition for the purpose and
without the benefit of a public hearing, announced a fare increase of
twenty (20%) percent of the existing fares

KMU filed a petition before the LTFRB opposing the upward adjustment
of bus fares.
ISSUE:

WON the above memoranda, circulars and/or orders of the DOTC and
the LTFRB which, among others, (a) authorize provincial bus and
jeepney operators to increase or decrease the prescribed
transportation fares without application therefor with the LTFRB and
without hearing and approval thereof by said agency is in violation of
Sec. 16(c) of CA 146, and in derogation of LTFRBs duty to fix and
determine just and reasonable fares by delegating that function to bus
operators, and (b) establish a presumption of public need in favor of
applicants for certificates of public convenience and place on the
oppositor the burden of proving that there is no need for the proposed
service, in patent violation not only of Sec. 16(c) of CA 146, as
amended, but also of Sec. 20(a) of the same Act mandating that fares
should be just and reasonable

HELD:

Yes.

Section 16(c) of the Public Service Act, as amended, reads:

Sec. 16. Proceedings of the Commission, upon notice and hearing.

The Commission shall have power, upon proper notice and hearing in
accordance with the rules and provisions of this Act, subject to the
limitations and exceptions mentioned and saving provisions to the
contrary:
xxx xxx xxx
(c) To fix and determine individual or joint rates, tolls, charges,
classifications, or schedules thereof, as well as commutation, mileage
kilometrage, and other special rates which shall be imposed, observed,
and followed thereafter by any public service: Provided, That the
Commission may, in its discretion, approve rates proposed by public
services provisionally and without necessity of any hearing; but it shall
call a hearing thereon within thirty days thereafter, upon publication
and notice to the concerns operating in the territory affected: Provided,
further, That in case the public service equipment of an operator is
used principally or secondarily for the promotion of a private business,
the net profits of said private business shall be considered in relation
with the public service of such operator for the purpose of fixing the
rates.

LTFRB is authorized under EO 202, s. 1987 to determine, prescribe,

approve and periodically review and adjust, reasonable fares, rates and
other related charges, relative to the operation of public land
transportation services provided by motorized vehicles

LTFRB not authorized to delegate that power to a common carrier, a

transport operator, or other public service

Authority given by the LTFRB to the provincial bus operators to set a

fare range over and above the authorized existing fare, is illegal and
invalid as it is tantamount to an undue delegation of legislative
authority

Rate should not be confiscatory as would place an operator in a

situation where he will continue to operate at a loss; rate should
enable public utilities to generate revenues sufficient to cover
operational costs and provide reasonable return on the investments
CPC - authorization granted by the LTFRB for the operation of land
transportation services for public use as required by law. Pursuant to
Section 16(a) of the Public Service Act, as amended, the following
requirements must be met before a CPC may be granted, to wit: (i) the
applicant must be a citizen of the Philippines, or a corporation or co-
partnership, association or joint-stock company constituted and
organized under the laws of the Philippines, at least 60 per centum of
its stock or paid-up capital must belong entirely to citizens of the
Philippines; (ii) the applicant must be financially capable of
undertaking the proposed service and meeting the responsibilities
incident to its operation; and (iii) the applicant must prove that the
operation of the public service proposed and the authorization to do
business will promote the public interest in a proper and suitable
manner; there must be proper notice and hearing before the PSC can
exercise its power to issue a CPC

LTFRB Memorandum Circular No. 92-009, Part IV is incompatible and

inconsistent with Section 16(c)(iii) of the Public Service Act which
requires that before a CPC will be issued, the applicant must prove by
proper notice and hearing that the operation of the public service
proposed will promote public interest in a proper and suitable manner.
On the contrary, the policy guideline states that the presumption of
public need for a public service shall be deemed in favor of the
applicant.
Citation: DEFENSOR-SANTIAGO vs. COMELEC

G.R. No. 127325, March 19, 1997

FACTS:

In 1996, Atty. Jesus Delfin filed with COMELEC a petition to amend

Constitution, to lift term limits of elective officials, by peoples
initiative. Delfin wanted COMELEC to control and supervise said
peoples initiative the signature-gathering all over the country. The
proposition is: Do you approve of lifting the term limits of all elective
government officials, amending for the purpose Sections 4 ) and 7 of
Article VI, Section 4 of Article VII, and Section 8 of Article 8 of Article X
of the 1987 Philippine Constitution? Said Petition for Initiative will first
be submitted to the people, and after it is signed by at least 12% total
number of registered voters in the country, it will be formally filed with
the COMELEC.

COMELEC in turn ordered Delfin for publication of the petition.

Petitioners Sen. Roco et al moved for dismissal of the Delfin Petition on
the ground that it is not the initiatory petition properly cognizable by
the COMELEC.
a. Constitutional provision on peoples initiative to amend the
Constitution can only be implemented by law to be passed by
Congress. No such law has been passed.

b. Republic Act No. 6735 provides for 3 systems on initiative but failed
to provide any subtitle on initiative on the Constitution, unlike in the
other modes of initiative. This deliberate omission indicates matter of
peoples initiative was left to some future law.

c. COMELEC has no power to provide rules and regulations for the

exercise of peoples initiative. Only Congress is authorized by the
Constitution to pass the implementing law.

d. Peoples initiative is limited to amendments to the Constitution, not

to revision thereof. Extending or lifting of term limits constitutes a
revision.

e. Congress nor any government agency has not yet appropriated

funds for peoples initiative.

ISSUE:
Whether or not the people can directly propose amendments to the
Constitution through the system of initiative under Section 2 of Article
XVII of the 1987 Constitution.

HELD:

REPUBLIC ACT NO. 6735

It was intended to include or cover peoples initiative on amendments

to the Constitution but, as worded, it does not adequately cover such
intiative. Article XVII Section 2 of the 1987 Constitution providing for
amendments to Constitution, is not self-executory. While the
Constitution has recognized or granted the right of the people to
directly propose amendments to the Constitution via PI, the people
cannot exercise it if Congress, for whatever reason, does not provide
for its implementation.
FIRST: Contrary to the assertion of COMELEC, Section 2 of the Act does
not suggest an initiative on amendments to the Constitution. The
inclusion of the word Constitution therein was a delayed
afterthought. The word is not relevant to the section which is silent as
to amendments of the Constitution.

SECOND: Unlike in the case of the other systems of initiative, the Act
does not provide for the contents of a petition for initiative on the
Constitution. Sec 5(c) does not include the provisions of the
Constitution sought to be amended, in the case of initiative on the
Constitution.

THIRD: No subtitle is provided for initiative on the Constitution. This

conspicuous silence as to the latter simply means that the main thrust
of the Act is initiative and referendum on national and local laws. The
argument that the initiative on amendments to the Constitution is not
accepted to be subsumed under the subtitle on National Initiative and
Referendum because it is national in scope. Under Subtitle II and III, the
classification is not based on the scope of the initiative involved, but on
its nature and character.

National initiative what is proposed to be enacted is a national law,

or a law which only Congress can pass.

Local initiative what is proposed to be adopted or enacted is a law,

ordinance or resolution which only legislative bodies of the
governments of the autonomous regions, provinces, cities,
municipalities, and barangays can pass.

Potestas delegata non delegari potest

What has been delegated, cannot be delegated. The recognized
exceptions to the rule are: [1] Delegation of tariff powers to the
President; [2] Delegation of emergency powers to the President; [3]
Delegation to the people at large; [4] Delegation to local governments;
and [5] Delegation to administrative bodies.

COMELEC

Empowering the COMELEC, an administrative body exercising quasi

judicial functions, to promulgate rules and regulations is a form of
delegation of legislative authority. In every case of permissible
delegation, there must be a showing that the delegation itself is valid.
It is valid only if the law (a) is complete in itself, setting forth therein
the policy to be executed, carried out, or implemented by the delegate;
and (b) fixes a standard the limits of which are sufficiently
determinate and determinable to which the delegate must conform in
the performance of his functions. Republic Act No. 6735 failed to satisfy
both requirements in subordinate legislation. The delegation of the
power to the COMELEC is then invalid.

COMELEC RESOLUTION NO. 2300

Insofar as it prescribes rules and regulations on the conduct of

initiative on amendments to the Constitution is void. COMELEC cannot
validly promulgate rules and regulations to implement the exercise of
the right of the people to directly propose amendments to the
Constitution through the system of initiative. It does not have that
power under Republic Act No. 6735.
Whether the COMELEC can take cognizance of, or has jurisdiction over,
a petition solely intended to obtain an order: (a) fixing the time and
dates for signature gathering; (b) instructing municipal election officers
to assist Delfins movement and volunteers in establishing signature
stations; and (c) directing or causing the publication of the unsigned
proposed Petition for Initiative on the 1987 Constitution.

DELFIN PETITION

COMELEC ACTED WITHOUT JURISDICTION OR WITH GRAVE ABUSE OF

DISCRETION IN ENTERTAINING THE DELFIN PETITION. Even if it be
conceded ex gratia that RA 6735 is a full compliance with the power of
Congress to implement the right to initiate constitutional amendments,
or that it has validly vested upon the COMELEC the power of
subordinate legislation and that COMELEC Resolution No. 2300 is valid,
the COMELEC acted without jurisdiction or with grave abuse of
discretion in entertaining the Delfin Petition.

The Delfin Petition does not contain signatures of the required number
of voters. Without the required signatures, the petition cannot be
deemed validly initiated. The COMELEC requires jurisdiction over a
petition for initiative only after its filing. The petition then is the
initiatory pleading. Nothing before its filing is cognizable by the
COMELEC, sitting en banc.

Since the Delfin Petition is not the initiatory petition under RA6735 and
COMELEC Resolution No. 2300, it cannot be entertained or given
cognizance of by the COMELEC. The petition was merely entered as
UND, meaning undocketed. It was nothing more than a mere scrap of
paper, which should not have been dignified by the Order of 6
December 1996, the hearing on 12 December 1996, and the order
directing Delfin and the oppositors to file their memoranda to file their
memoranda or oppositions. In so dignifying it, the COMELEC acted
without jurisdiction or with grave abuse of discretion and merely
wasted its time, energy, and resources.

Therefore, Republic Act No. 6735 did not apply to constitutional

amendment.

*OTHER SOURCE Santiago v COMELEC

HELD: NO. R.A. 6735 is inadequate to cover the system of initiative on

amendments to the Constitution.

Under the said law, initiative on the Constitution is confined only to

proposals to AMEND. The people are not accorded the power to
"directly propose, enact, approve, or reject, in whole or in part, the
Constitution" through the system of initiative. They can only do so
with respect to "laws, ordinances, or resolutions." The use of the
clause "proposed laws sought to be enacted, approved or rejected,
amended or repealed" denotes that R.A. No. 6735 excludes initiative on
amendments to the Constitution.

Also, while the law provides subtitles for National Initiative and
Referendum and for Local Initiative and Referendum, no subtitle is
provided for initiative on the Constitution. This means that the main
thrust of the law is initiative and referendum on national and local
laws. If R.A. No. 6735 were intended to fully provide for the
implementation of the initiative on amendments to the Constitution, it
could have provided for a subtitle therefor, considering that in the
order of things, the primacy of interest, or hierarchy of values, the right
of the people to directly propose amendments to the Constitution is far
more important than the initiative on national and local laws.

While R.A. No. 6735 specially detailed the process in implementing

initiative and referendum on national and local laws, it intentionally did
not do so on the system of initiative on amendments to the
Constitution.
COMELEC Resolution No. 2300 is hereby declared void and orders the
respondent to forthwith dismiss the Delfin Petition . TRO issued on 18
December 1996 is made permanent.

WHEREFORE, petition is GRANTED.

Citation: ABAKADA Guro Party List v Ermita G.R. No. 168056
September 1, 2005

Facts: Mounting budget deficit, revenue generation, inadequate fiscal

allocation for education, increased emoluments for health workers, and
wider coverage for full value-added tax benefits these are the
reasons why Republic Act No. 9337 (R.A. No. 9337) was enacted.

R.A. No. 9337 is a consolidation of three legislative bills namely, House

Bill Nos. 3555 and 3705, and Senate Bill No. 1950.
Because of the conflicting provisions of the proposed bills the Senate
agreed to the request of the House of Representatives for a committee
conference. The Conference Committee on the Disagreeing Provisions
of House Bill recommended the approval of its report, which the Senate
and the House of the Representatives did.

The President signed into law the consolidated House and Senate
versions as Republic Act 9337. Before the law was to take effect on July
1, 2005, the Court issued a temporary restraining order enjoining
government from implementing the law in response to a slew of
petitions for certiorari and prohibition questioning the constitutionality
of the new law.

Among others, Petitioners contend that Sections 4, 5, and 6 of R.A. No.

9337 constitute an undue delegation of legislative power, in violation
of Article VI, Section 28(2) of the Constitution;

Issue: W/N there is an undue delegation of legislative power

Held: In the present case, the challenged section of R.A. No. 9337 is
the common proviso in Sections 4, 5 and 6 which reads as follows:
That the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-added
tax to twelve percent (12%), after any of the following conditions has
been satisfied:(i) Value-added tax collection as a percentage of Gross
Domestic Product (GDP) of the previous year exceeds two and four-
fifth percent (2 4/5%); or(ii) National government deficit as a
percentage of GDP of the previous year exceeds one and one-half
percent (1 %)

In every case of permissible delegation, there must be a showing that

the delegation itself is valid. It is valid only if the law (a) is complete in
itself, setting forth therein the policy to be executed, carried out, or
implemented by the delegate;41 and (b) fixes a standard the limits
of which are sufficiently determinate and determinable to which the
delegate must conform in the performance of his functions. A sufficient
standard is one which defines legislative policy, marks its limits, maps
out its boundaries and specifies the public agency to apply it. It
indicates the circumstances under which the legislative command is to
be effected. Both tests are intended to prevent a total transference of
legislative authority to the delegate, who is not allowed to step into the
shoes of the legislature and exercise a power essentially legislative.
A distinction has rightfully been made between delegation of power to
make the laws which necessarily involves a discretion as to what it
shall be, which constitutionally may not be done, and delegation of
authority or discretion as to its execution to be exercised under and in
pursuance of the law, to which no valid objection can be made.

The case before the Court is not a delegation of legislative power. It is

simply a delegation of ascertainment of facts upon which enforcement
and administration of the increase rate under the law is contingent.
The legislature has made the operation of the 12% rate effective
January 1, 2006, contingent upon a specified fact or condition. It leaves
the entire operation or non-operation of the 12% rate upon factual
matters outside of the control of the executive. No discretion would be
exercised by the President. Highlighting the absence of discretion is the
fact that the word shall is used in the common proviso. The use of the
word shall connote a mandatory order. Its use in a statute denotes an
imperative obligation and is inconsistent with the idea of discretion.
Where the law is clear and unambiguous, it must be taken to mean
exactly what it says, and courts have no choice but to see to it that the
mandate is obeyed.

There is no undue delegation of legislative power but only of the

discretion as to the execution of a law. This is constitutionally
permissible. Congress does not abdicate its functions or unduly
delegate power when it describes what job must be done, who must do
it, and what is the scope of his authority; in our complex economy that
is frequently the only way in which the legislative process can go
forward.
Citation: G.R. No. 166715 August 14, 2008

ABAKADA GURO PARTY LIST (formerly

AASJS) OFFICERS/MEMBERS SAMSON S. ALCANTARA, ED
VINCENT S. ALBANO, ROMEO R. ROBISO, RENE B. GOROSPE and
EDWIN R. SANDOVAL, petitioners,
vs.
HON. CESAR V. PURISIMA, in his capacity as Secretary of
Finance, HON. GUILLERMO L. PARAYNO, JR., in his capacity as
Commissioner of the Bureau of Internal Revenue, and HON.
ALBERTO D. LINA, in his Capacity as Commissioner of Bureau of
Customs, respondents.

CORONA, J.:
This petition for prohibition seeks to prevent respondents from
implementing and enforcing Republic Act (RA) 9335 (Attrition Act of
2005).

FACTS:

RA 9335 was enacted to optimize the revenue-generation capability

and collection of the Bureau of Internal Revenue (BIR) and the
Bureau of Customs (BOC). The law intends to encourage BIR and
BOC officials and employees to exceed their revenue targets by
providing a system of rewards and sanctions through the
creation of a Rewards and Incentives Fund (Fund) and a Revenue
Performance Evaluation Board (Board).

It covers all offi cials and employees of the BIR and the BOC with
at least six months of service, regardless of employment status.
The Fund is sourced from the collection of the BIR and the BOC in
excess of their revenue targets for the year, as determined by the
Development Budget and Coordinating Committee (DBCC). Any
incentive or reward is taken from the fund and allocated to the BIR and
the BOC in proportion to their contribution in the excess
collection of the targeted amount of tax revenue.

The DOF, DBM, NEDA, BIR, BOC and the Civil Service Commission (CSC)
were tasked to promulgate and issue the implementing rules and
regulations of RA 9335, to be approved by a Joint Congressional
Oversight Committee created for such purpose.

Petitioners, invoking their right as taxpayers filed this petition

challenging the constitutionality of RA 9335, a tax reform legislation.

They contend that:

 By establishing a system of rewards and incentives, the law
"transform[s] the officials and employees of the BIR and the BOC
into mercenaries and bounty hunters" as they will do their best
only in consideration of such rewards. Thus, the system of
rewards and incentives invites corruption and undermines the
constitutionally mandated duty of these officials and employees
to serve the people with utmost responsibility, integrity, loyalty
and efficiency.
Petitioners also claim that limiting the scope of the system of
rewards and incentives only to officials and employees of the BIR
and the BOC violates the constitutional guarantee of equal
protection.
The fixing of revenue targets which has been delegated to the
President without sufficient standards will therefore be a ground
in order to dismiss BIR and BOC personnel if the President sets
an unrealistic and unattainable target.
Finally, petitioners assail the creation of a congressional
oversight committee on the ground that it violates the doctrine
of separation of powers. While the legislative function is deemed
accomplished and completed upon the enactment and approval
of the law, the creation of the congressional oversight committee
permits legislative participation in the implementation and
enforcement of the law.

Respondents comment:

They question the petition for being premature as there is no

actual case or controversy yet. Petitioners have not asserted any
right or claim that will necessitate the exercise of this Courts
jurisdiction.
 They assert that the allegation that the reward system will breed
mercenaries is mere speculation and does not suffice to
invalidate the law.
Seen in conjunction with the declared objective of RA 9335, the
law validly classifies the BIR and the BOC because the functions
they perform are distinct from those of the other government
agencies and instrumentalities. Moreover, the law provides a
sufficient standard that will guide the executive in the
implementation of its provisions.
Lastly, the creation of the congressional oversight committee
under the law enhances, rather than violates, separation of
powers. It ensures the fulfilment of the legislative policy and
serves as a check to any over-accumulation of power on the part
of the executive and the implementing agencies.

ISSUES:

1. Whether or not RA 9335 constitutional?

2. Whether or not the limitation of the scope of the system of rewards and
incentives only to officials and employees of the BIR and BOC violates the
constitutional guarantee of equal protection?
3. Whether or not the law unduly delegates the power to fix revenue targets
to the President?
4. Whether or not the creation of the congressional oversight
committee violates the doctrine of separation of powers?

RULING:
An actual case or controversy involves a conflict of legal rights, an
assertion of opposite legal claims susceptible of judicial adjudication. It
means that there is a direct adverse effect on the individual
challenging it. Thus, to be ripe for judicial adjudication, the petitioner
must show a personal stake in the outcome of the case or an injury to
himself that can be redressed by a favourable decision of the Court.

In this case, petitioners fail to assert any specific and concrete legal
claim or to demonstrate any direct adverse effect of the law on them.
They are unable to show a personal stake in the outcome of this case
or an injury to themselves.

1. YES. A law enacted by Congress enjoys the strong presumption

of constitutionality. To justify its nullification, there must be a clear and
unequivocal breach of the Constitution, not a doubtful and equivocal
one. To invalidate RA 9335 based on petitioners baseless supposition
is an affront to the wisdom not only of the legislature that passed it but
also of the executive which approved it.

Public service is its own reward. Nevertheless, public officers may by

law be rewarded for exemplary and exceptional performance. A system
of incentives for exceeding the set expectations of a public office is not
anathema to the concept of public accountability. In fact, it recognizes
and reinforces dedication to duty, industry, efficiency and loyalty to
public service of deserving government personnel.

2. NO. In United States v. Matthews, the U.S. Supreme Court

validated a law which awards to officers of the customs as well as
other parties an amount not exceeding one-half of the net proceeds of
forfeitures in violation of the laws against smuggling.
In the same vein, employees of the BIR and the BOC may by law be
entitled to a reward when, as a consequence of their zeal in the
enforcement of tax and customs laws, they exceed their revenue
targets.

Equality guaranteed under the equal protection clause is equality

under the same conditions and among persons similarly situated; it is
equality among equals, not similarity of treatment of persons who are
classified based on substantial differences in relation to the object to
be accomplished. In Victoriano v. Elizalde Rope Workers Union,20 this
Court declared:

All that is required of a valid classification is that it be

reasonable, which means that the classification should be
based on substantial distinctions which make for real
differences, that it must be germane to the purpose of
the law; that it must not be limited to existing conditions
only; and that it must apply equally to each member of
the class.

With respect to RA 9335, its expressed public policy is the optimization

of the revenue-generation capability and collection of the BIR and the
BOC. Both the BIR and the BOC are bureaus under the DOF. They
principally perform the special function of being the instrumentalities
through which the State exercises one of its great inherent functions
taxation. Indubitably, such substantial distinction is germane and
intimately related to the purpose of the law. Hence, the classification
and treatment accorded to the BIR and the BOC under RA 9335 fully
satisfy the demands of equal protection.

3. NO. Two tests determine the validity of delegation of legislative

power: (1) the completeness test and (2) the sufficient standard test. A
law is complete when it sets forth therein the policy to be executed,
carried out or implemented by the delegate. It lays down a sufficient
standard when it provides adequate guidelines or limitations in the law
to map out the boundaries of the delegates authority and prevent the
delegation from running riot. To be sufficient, the standard must
specify the limits of the delegates authority, announce the legislative
policy and identify the conditions under which it is to be implemented.

RA 9335 adequately states the policy and standards to guide the

President in fixing revenue targets and the implementing agencies in
carrying out the provisions of the law.

Revenue targets are based on the original estimated revenue

collection expected respectively of the BIR and the BOC for a given
fiscal year as approved by the DBCC and stated in the BESF
submitted by the President to Congress. Thus, the
determination of revenue targets does not rest solely on the
President as it also undergoes the scrutiny of the DBCC.

4. YES. The Joint Congressional Oversight Committee in RA 9335

was created for the purpose of approving the implementing rules and
regulations (IRR) formulated by the DOF, DBM, NEDA, BIR, BOC and
CSC. On May 22, 2006, it approved the said IRR.

From the moment the law becomes effective, any provision of law that
empowers Congress or any of its members to play any role in the
implementation or enforcement of the law violates the principle of
separation of powers and is thus unconstitutional. Under this principle,
a provision that requires Congress or its members to approve the
implementing rules of a law after it has already taken effect shall be
unconstitutional, as is a provision that allows Congress or its members
to overturn any directive or ruling made by the members of the
executive branch charged with the implementation of the law.

Following this rationale, Section 12 of RA 9335 should be struck down

as unconstitutional.

The next question to be resolved is: what is the effect of the

unconstitutionality of Section 12 of RA 9335 on the other provisions of
the law? Will it render the entire law unconstitutional? NO.

Section 13 of RA 9335 provides:

SEC. 13. Separability Clause. If any provision of this Act is

declared invalid by a competent court, the remainder of this Act
or any provision not affected by such declaration of invalidity
shall remain in force and effect.

The separability clause of RA 9335 reveals the intention of the

legislature to isolate and detach any invalid provision from the other
provisions so that the latter may continue in force and effect. The valid
portions can stand independently of the invalid section. Without
Section 12, the remaining provisions still constitute a complete,
intelligible and valid law which carries out the legislative intent to
optimize the revenue-generation capability and collection of the BIR
and the BOC by providing for a system of rewards and sanctions
through the Rewards and Incentives Fund and a Revenue Performance
Evaluation Board.

DISPOSITIVE:

WHEREFORE, the petition is hereby PARTIALLY GRANTED. Section

12 of RA 9335 creating a Joint Congressional Oversight Committee to
approve the implementing rules and regulations of the law is
declared UNCONSTITUTIONAL and therefore NULL and VOID. The
constitutionality of the remaining provisions of RA 9335 is UPHELD.
Pursuant to Section 13 of RA 9335, the rest of the provisions remain in
force and effect.

Topic: [Legislative Department - Power to Declare War and

Delegate Emergency Power]

Citation: David v Arroyo G.R. No. 171396, May 3 2006

FACTS:
On February 24, 2006, President Arroyo issued PP No. 1017 declaring a
state of emergency, thus:

NOW, THEREFORE, I, Gloria Macapagal-Arroyo, President of the

Republic of the Philippines and Commander-in-Chief of the Armed
Forces of the Philippines, [calling-out power] by virtue of the powers
vested upon me by Section 18, Article 7 of the Philippine Constitution
which states that: The President. . . whenever it becomes
necessary, . . . may call out (the) armed forces to prevent or
suppress. . .rebellion. . ., and in my capacity as their Commander-
in-Chief, do hereby command the Armed Forces of the Philippines, to
maintain law and order throughout the Philippines, prevent or suppress
all forms of lawless violence as well as any act of insurrection or
rebellion ["take care" power] and to enforce obedience to all the laws
and to all decrees, orders and regulations promulgated by me
personally or upon my direction; and [power to take over] as provided
in Section 17, Article 12 of the Constitution do hereby declare a State
of National Emergency.

On the same day, PGMA issued G.O. No. 5 implementing PP1017,

directing the members of the AFP and PNP "to immediately carry out
the necessary and appropriate actions and measures to suppress and
prevent acts of terrorism and lawless violence."

David, et al. assailed PP 1017 on the grounds that (1) it encroaches on

the emergency powers of Congress; (2) it is a subterfuge to avoid the
constitutional requirements for the imposition of martial law; and (3) it
violates the constitutional guarantees of freedom of the press, of
speech and of assembly. They alleged direct injury resulting from
illegal arrest and unlawful search committed by police operatives
pursuant to PP 1017.

During the hearing, the Solicitor General argued that the issuance of PP
1017 and GO 5 have factual basis, and contended that the intent of the
Constitution is to give full discretionary powers to the President in
determining the necessity of calling out the armed forces. The
petitioners did not contend the facts stated by the Solicitor General.

ISSUE:
Whether or not the PP 1017 and G.O. No. 5 is constitutional.

RULING:

The operative portion of PP 1017 may be divided into three important

provisions, thus:

First provision: by virtue of the power vested upon me by Section 18,

Article VII do hereby command the Armed Forces of the Philippines,
to maintain law and order throughout the Philippines, prevent or
suppress all forms of lawless violence as well any act of insurrection or
rebellion

Second provision: and to enforce obedience to all the laws and to

all decrees, orders and regulations promulgated by me personally or
upon my direction;

Third provision: as provided in Section 17, Article XII of the

Constitution do hereby declare a State of National Emergency.

PP 1017 is partially constitutional insofar as provided by the first

provision of the decree.

First Provision: Calling Out Power.

The only criterion for the exercise of the calling-out power is that
whenever it becomes necessary, the President may call the armed
forces to prevent or suppress lawless violence, invasion or rebellion.
(Integrated Bar of the Philippines v. Zamora)
President Arroyos declaration of a state of rebellion was merely an
act declaring a status or condition of public moment or interest, a
declaration allowed under Section 4, Chap 2, Bk II of the Revised
Administration Code. Such declaration, in the words of Sanlakas, is
harmless, without legal significance, and deemed not written. In these
cases, PP 1017 is more than that. In declaring a state of national
emergency, President Arroyo did not only rely on Section 18, Article VII
of the Constitution, a provision calling on the AFP to prevent or
suppress lawless violence, invasion or rebellion. She also relied on
Section 17, Article XII, a provision on the States extraordinary power
to take over privately-owned public utility and business affected with
public interest. Indeed, PP 1017 calls for the exercise of an awesome
power. Obviously, such Proclamation cannot be deemed harmless.
To clarify, PP 1017 is not a declaration of Martial Law. It is merely an
exercise of President Arroyos calling-out power for the armed forces to
assist her in preventing or suppressing lawless violence.

Second Provision: The "Take Care" Power.

The second provision pertains to the power of the President to ensure

that the laws be faithfully executed. This is based on Section 17,
Article VII which reads:

SEC. 17. The President shall have control of all the executive
departments, bureaus, and offices. He shall ensure that the laws be
faithfully executed.
This Court rules that the assailed PP 1017 is unconstitutional insofar as
it grants President Arroyo the authority to promulgate decrees.
Legislative power is peculiarly within the province of the Legislature.
Section 1, Article VI categorically states that [t]he legislative power
shall be vested in the Congress of the Philippines which shall consist of
a Senate and a House of Representatives. To be sure, neither Martial
Law nor a state of rebellion nor a state of emergency can justify
President Arroyos exercise of legislative power by issuing decrees.

Third Provision: The Power to Take Over

Distinction must be drawn between the Presidents authority to

declare a state of national emergency and to exercise emergency
powers. To the first, Section 18, Article VII grants the President such
power, hence, no legitimate constitutional objection can be raised. But
to the second, manifold constitutional issues arise.
Generally, Congress is the repository of emergency powers. This is
evident in the tenor of Section 23 (2), Article VI authorizing it to
delegate such powers to the President. Certainly, a body cannot
delegate a power not reposed upon it. However, knowing that during
grave emergencies, it may not be possible or practicable for Congress
to meet and exercise its powers, the Framers of our Constitution
deemed it wise to allow Congress to grant emergency powers to the
President, subject to certain conditions, thus:

(1) There must be a war or other emergency.

(2) The delegation must be for a limited period only.
(3) The delegation must be subject to such restrictions as the
Congress may prescribe.
(4) The emergency powers must be exercised to carry out a national
policy declared by Congress.

Section 17, Article XII must be understood as an aspect of the

emergency powers clause. The taking over of private business
affected with public interest is just another facet of the emergency
powers generally reposed upon Congress. Thus, when Section 17
states that the the State may, during the emergency and under
reasonable terms prescribed by it, temporarily take over or direct the
operation of any privately owned public utility or business affected with
public interest, it refers to Congress, not the President. Now,
whether or not the President may exercise such power is dependent on
whether Congress may delegate it to him pursuant to a law prescribing
the reasonable terms thereof.

Following our interpretation of Section 17, Article XII, invoked by

President Arroyo in issuing PP 1017, this Court rules that such
Proclamation does not authorize her during the emergency to
temporarily take over or direct the operation of any privately owned
public utility or business affected with public interest without authority
from Congress.

Let it be emphasized that while the President alone can declare a

state of national emergency, however, without legislation, he has no
power to take over privately-owned public utility or business affected
with public interest. Nor can he determine when such exceptional
circumstances have ceased. Likewise, without legislation, the
President has no power to point out the types of businesses affected
with public interest that should be taken over. In short, the President
has no absolute authority to exercise all the powers of the State under
Section 17, Article VII in the absence of an emergency powers act
passed by Congress.
As of G.O. No. 5, it is constitutional since it provides a standard by
which the AFP and the PNP should implement PP 1017, i.e. whatever is
necessary and appropriate actions and measures to suppress and
prevent acts of lawless violence. Considering that acts of terrorism
have not yet been defined and made punishable by the Legislature,
such portion of G.O. No. 5 is declared unconstitutional.

*Other Source David v Arroyo

Held:

Take-Care Power

This refers to the power of the President to ensure that the laws be
faithfully executed, based on Sec. 17, Art. VII: The President shall
have control of all the executive departments, bureaus and offices. He
shall ensure that the laws be faithfully executed.

As the Executive in whom the executive power is vested, the primary

function of the President is to enforce the laws as well as to formulate
policies to be embodied in existing laws. He sees to it that all laws are
enforced by the officials and employees of his department. Before
assuming office, he is required to take an oath or affirmation to the
effect that as President of the Philippines, he will, among others,
execute its laws. In the exercise of such function, the President, if
needed, may employ the powers attached to his office as the
Commander-in-Chief of all the armed forces of the country, including
the Philippine National Police under the Department of Interior and
Local Government.
The specific portion of PP 1017 questioned is the enabling clause: to
enforce obedience to all the laws and to all decrees, orders and
regulations promulgated by me personally or upon my direction.

Is it within the domain of President Arroyo to promulgate decrees?

The President is granted an Ordinance Power under Chap. 2, Book III of

E.O. 292. President Arroyos ordinance power is limited to those
issuances mentioned in the foregoing provision. She cannot issue
decrees similar to those issued by Former President Marcos under PP
1081. Presidential Decrees are laws which are of the same category
and binding force as statutes because they were issued by the
President in the exercise of his legislative power during the period of
Martial Law under the 1973 Constitution.

This Court rules that the assailed PP 1017 is unconstitutional insofar as

it grants President Arroyo the authority to promulgate decrees.
Legislative power is peculiarly within the province of the Legislature.
Sec. 1, Art. VI categorically states that the legislative power shall be
vested in the Congress of the Philippines which shall consist of a
Senate and a House of Representatives. To be sure, neither Martial
Law nor a state of rebellion nor a state of emergency can justify
President Arroyos exercise of legislative power by issuing decrees.

But can President Arroyo enforce obedience to all decrees and

laws through the military?

As this Court stated earlier, President Arroyo has no authority to enact

decrees. It follows that these decrees are void and, therefore, cannot
be enforced. With respect to laws, she cannot call the military to
enforce or implement certain laws, such as customs laws, laws
governing family and property relations, laws on obligations and
contracts and the like. She can only order the military, under PP 1017,
to enforce laws pertinent to its duty to suppress lawless violence.

Citation: Divinagracia v. CBS (2009)

Doctrine:

Although there is no doubt that the President may exercise the

authority granted to him under Section 5 of R.A. No. 7477
(charter of PBS) which provides that the President of the
Philippines may temporarily take over and operate the stations
of the grantee, temporarily suspend the operation of any
stations in the interest of public safety, security and public
welfare, or authorize the temporary use and operation thereof
by any agency of the Government, such authority can be
exercised only under limited and rather drastic circumstances.
They still do not vest in the NTC the broad authority to cancel
licenses and permits.

Facts:

Santiago Divinagracia alleged that Consolidated Broadcasting System,

Inc. (CBS) and Peoples Broadcasting Service, Inc. (PBS), two of three
radio networks that comprise Bombo Radyo Philippines, violated the
terms of their congressional franchises when they failed to offer at
least 30 percent of their common stocks to the public as required by
law and their legislative franchises.

Divinagracia claimed that because of the misuse and violation of their

franchises, the provisional authorities granted by the NTC to PBS and
CBS to install, operate and maintain various AM and FM broadcast
stations had to be cancelled.

The NTC however dismissed the complaints, claiming that while it had
full jurisdiction to revoke or cancel a PA or CPC for violations or
infractions of the terms and conditions embodied therein, the
complaints actually constituted collateral attacks on the legislative
franchises of the two networks which are more properly the subject of
a quo warranto action to be commenced by the Solicitor General in the
name of the Republic of the Philippines.
Divinagracia went to the Court of Appeals which upheld the NTCs
denial. He then elevated the matter to the Supreme Court.

Issue:

Whether or not the NTC has the power to cancel the CPCs it has issued
to legislative franchisees

Held/Ratio:

No, the NTC does not have the power to cancel CPCs.

The Radio Control Act of 1931 requires broadcast stations to obtain a

legislative franchise and such requirement was not repealed by E.O.
546 which established the NTC, the administrative agency which has
regulatory jurisdiction over broadcast stations.

When Congress grants a legislative franchise, it is the legal obligation

of the NTC to facilitate the operation by the franchisee of its broadcast
station and since public administration of the airwaves is a highly
technical function, the Congress has delegated to the NTC the task of
administration.

The licensing power of the NTC arises from the necessary delegation
by Congress of legislative power geared towards the orderly exercise
by franchisees of the rights granted them by Congress.

But even as the NTC is vested with the power to issue CPCs to
broadcast stations, it is not expressly vested with the power to cancel
such CPCs, or otherwise prevent broadcast stations with duly issued
franchises and CPCs from operating radio and television stations. There
is no such expression in the law, and by presuming such right the Court
will be acting contrary to the stated State interest as expressed in
respondents legislative franchises.

Although there is no doubt that the President may exercise the

authority granted to him under Section 5 of R.A. No. 7477 (charter of
PBS) which provides that the President of the Philippines may
temporarily take over and operate the stations of the grantee,
temporarily suspend the operation of any stations in the interest of
public safety, security and public welfare, or authorize the temporary
use and operation thereof by any agency of the Government, such
authority can be exercised only under limited and rather drastic
circumstances. They still do not vest in the NTC the broad authority to
cancel licenses and permits.