Pangasinan Transport Co. vs. Public Service Commission GR NO.

47065, June 26, 1940

FACTS:

This is a case on the certificate of public convenience of petitioner Pangasinan Transportation Co. Inc
(Pantranco). The petitioner has been engaged for the past twenty years in the business of transporting
passengers in the province of Pangasinan and Tarlac, Nueva Ecija and Zambales. On August 26, 1939,
Pantranco filed with the Public Service Commission (PSC) an application to operate 10 additional buses.
PSC granted the application with 2 additional conditions which was made to apply also on their existing
business. Pantranco filed a motion for reconsideration with the Public Service Commission. Since it was
denied, Pantranco then filed a petition/ writ of certiorari.

ISSUES:

Whether the legislative power granted to Public Service Commission:

- is unconstitutional and void because it is without limitation

- constitutes undue delegation of powers

HELD:

The challenged provisions of Commonwealth Act No. 454 are valid and constitutional because it is a
proper delegation of legislative power, so called Subordinate Legislation . It is a valid delegation
because of the growing complexities of modern government, the complexities or multiplication of the
subjects of governmental regulation and the increased difficulty of administering the laws. All that has
been delegated to the Commission is the administrative function, involving the use of discretion to carry
out the will of the National Assembly having in view, in addition, the promotion of public interests in a
proper and suitable manner. The Certificate of Public Convenience is neither a franchise nor contract,
confers no property rights and is a mere license or privilege, subject to governmental control for the
good of the public. PSC has the power, upon notice and hearing, to amend, modify, or revoked at any
time any certificate issued, whenever the facts and circumstances so warranted. The limitation of 25
years was never heard, so the case was remanded to PSC for further proceedings. In addition, the Court
ruled that, the liberty and property of the citizens should be protected by the rudimentary
requirements of fair play. Not only must the party be given an opportunity to present his case and to
adduce evidence tending to establish the rights that he asserts but the tribunal must consider the
evidence presented. When private property is affected with a public interest, it ceased to be juris privati
or private use only.
Separation of Powers

In re: Manzano [A.M. No. 88-7-1861-RTC, October 5, 1988]

IN DEFERENCE TO THE CONCEPT OF SEPARATION OF POWERS, JUDICIAL OFFICERS ARE NOT ALLOWED
TO BE APPOINTED TO POSITIONS PERFORMING NON-JUDICIAL FUNCTIONS. - Under the Constitution, the
members of the Supreme Court and other courts established by law shall not be designated to any
agency performing quasi-judicial or administrative functions (Section 12, Art. VIII, Constitution).

Considering that membership of Judge Manzano in the Ilocos Norte Provincial Committee on Justice,
which discharges administrative functions, will be in violation of the Constitution, the Court is
constrained to deny his request.

Former Chief Justice Enrique M. Fernando in his concurring opinion in the case of Garcia vs. Macaraig
(39 SCRA 106) ably sets forth:

"While the doctrine of separation of powers is a relative theory not to be enforced with pedantic rigor,
the practical demands of government precluding its doctrinaire application, it cannot justify a member
of the judiciary being required to assume a position or perform a duty non-judicial in character. That is
implicit in the principle. Otherwise there is a plain departure from its command. The essence of the trust
reposed in him is to decide. Only a higher court, as was emphasized by Justice Barredo, can pass on his
actuation. He is not a subordinate of an executive or legislative official, however eminent. It is
indispensable that there be no exception to the rigidity of such a norm if he is, as expected, to be
confined to the task of adjudication. Fidelity to his sworn responsibility no less than the maintenance of
respect for the judiciary can be satisfied with nothing less."

This declaration does not mean that RTC Judges should adopt an attitude of monastic insensibility or
unbecoming indifference to Province/City Committee on Justice. As incumbent RTC Judges, they form
part of the structure of government. Their integrity and performance in the adjudication of cases
contribute to the solidity of such structure. As public officials, they are trustees of an orderly society.
Even as non-members of Provincial/City Committees on Justice, RTC judges should render assistance to
said Committees to help promote the laudable purposes for which they exist, but only when such
assistance may be reasonably incidental to the fulfillment of their judicial duties.
Eastern Shipping Lines, Inc. vs Court of Appeals and Davao Pilots Association

GR No. 116356, 29 June 1998, J. Panganiban

FACTS:

Private respondent Davao Pilots Association filed a complaint against petitioner Eastern Shipping Lines,
Inc. for sum of money, alleging that petitioner has unpaid fees for pilotage services rendered by
respondent. Petitioner disputed the claims of respondent by assailing the constitutionality of Executive
Order 1088, from which respondent based its claims. It maintains that rates of pilotage fees should be
based on circulars issued by the Philippine Ports Authority since it has been given the power to set the
rates by virtue of PD 857.The lower court ruled in favor of respondent and this decision was affirmed in
toto by the Court of Appeals. Hence, this petition for certiorari.

ISSUE:

Whether EO 1088 is unconstitutional.

RULING:

EO 1088 is valid. The Court adopts its pronouncement in Philippine Interisland Shipping Association of
the Philippines vs. Court of Appeals:

E.O. NO. 1088 provides for adjusted pilotage service rates without withdrawing the power of the PPA
to impose, prescribe, increase or decrease rates, charges or fees. The reason is because EO 1088 is not
meant simply to fix new pilotage rates. Its legislative purpose is the "rationalization of pilotage service
charges, through the imposition of uniform and adjusted rates for foreign and coastwise vessels in all
Philippine ports.

xxx xxx xxx

We conclude that E.O. No. 1088 is a valid statute and that the PPA is duty bound to comply with its
provisions. The PPA may increase the rates but it may not decrease them below those mandated by EO

1088

Because the PPA circulars are inconsistent with EO 1088, they are void and ineffective. "Administrative
or executive acts, orders and regulations shall be valid only when they are not contrary to the laws or
the Constitution." An administrative agency, like PPA, has no discretion whether to implement the law
or not. Its duty is to enforce it. Thus, if there is any conflict between the PPA circular and a law, such as
EO 1088, the latter prevails.

Petition is denied and the decision of the CA is affirmed

Philam v Arnaldo G.R. No. 76452 July 26, 1994

Facts:

One Ramon Paterno complained about the unfair practices committed by the company against its
agents, employees and consumers. The Commissioner called for a hearing where Paterno was required
to specify which acts were illegal. Paterno then specified that the fees and charges stated in the
Contract of Agency between Philam and its agents be declared void. Philam, on the other hand, averred
that there Paterno must submit a verified formal complaint and that his letter didnt contain information
Philam was seeking from him. Philam then questioned the Insurance Commissions jurisdiction over the
matter and submitted a motion to quash. The commissioner denied this. Hence this petition.

Issue: Whether or not the resolution of the legality of the Contract of Agency falls within the jurisdiction
of the Insurance Commissioner.

Held:

No. Petition granted.

Ratio:

According to the Insurance code, the Insurance Commissioner was authorized to suspend, directors,
officers, and agents of insurance companies. In general, he was tasked to regulate the insurance
business, which includes:

(2) The term "doing an insurance business" or "transacting an insurance business," within the meaning
of this Code, shall include

(a) making or proposing to make, as insurer, any insurance contract;

(b) making, or proposing to make, as surety, any contract of suretyship as a vocation and not as
merely incidental to any other legitimate business or activity of the surety; (c) doing any kind of
business, including a reinsurance business, specifically recognized as constituting the doing of an
insurance business within the meaning of this Code; (d) doing or proposing to do any business in
substance equivalent to any of the foregoing in a manner designed to evade the provisions of
this Code. (Insurance Code, Sec. 2[2])

The contract of agency between Philamlife and its agents wasnt included with the Commissoners
power to regulate the business. Hence, the Insurance commissioner wasnt vested with jurisidiction
under the rule expresio unius est exclusion alterius.

The respondent contended that the commissioner had the quasi-judicial power to adjudicate under
Section 416 of the Code. It stated:
The Commissioner shall have the power to adjudicate claims and complaints involving any loss, damage
or liability for which an insurer may be answerable under any kind of policy or contract of insurance, or
for which such insurer may be liable under a contract of suretyship, or for which a reinsurer may be used
under any contract or reinsurance it may have entered into, or for which a mutual benefit association
may be held liable under the membership certificates it has issued to its members, where the amount of
any such loss, damage or liability, excluding interest, costs and attorney's fees, being claimed or sued
upon any kind of insurance, bond, reinsurance contract, or membership certificate does not exceed in
any single claim one hundred thousand pesos.

This was, however, regarding complaints filed by the insured against the Insurance company.

Also, the insurance code only discusses the licensing requirements for agents and brokers. The
Insurance Code does not have provisions governing the relations between insurance companies and
their agents.

Investment Planning Corporation of the Philippines v. Social Security Commission- that an insurance
company may have two classes of agents who sell its insurance policies: (1) salaried employees who
keep definite hours and work under the control and supervision of the company; and (2) registered
representatives, who work on commission basis.

The agents under the 2nd sentence are governed by the Civil Code laws on agency. This means that the
regular courts have jurisdiction over this category.
MARCOS VS MANGLAPUS

G.R. No. 88211 September 15 1989

FACTS:

Former President Marcos, after his and his family spent three year exile in Hawaii, USA, sought to return
to the Philippines. The call is about to request of Marcos family to order the respondents to issue travel
order to them and to enjoin the petition of the President's decision to bar their return to the Philippines.

ISSUE:

Whether or not, in the exercise of the powers granted by the Constitution, the President may prohibit
the Marcoses from returning to the Philippines.

RULING:

Yes

According to Section 1, Article VII of the 1987 Constitution: "The executive power shall be vested in the
President of the Philippines." The phrase, however, does not define what is meant by executive power
although the same article tackles on exercises of certain powers by the President such as appointing
power during recess of the Congress (S.16), control of all the executive departments, bureaus, and
offices (Section 17), power to grant reprieves, commutations, and pardons, and remit fines and
forfeitures, after conviction by final judgment (Section 19), treaty making power (Section 21), borrowing
power (Section 20), budgetary power (Section 22), informing power (Section 23).

The Constitution may have grant powers to the President, it cannot be said to be limited only to the
specific powers enumerated in the Constitution. Whatever power inherent in the government that is
neither legislative nor judicial has to be executive.
Pelaez vs. Auditor General Digest

G.R. No. L-23825 December 24, 1965

Facts:

From September 4, 1964 to October 29, 1964 the President of the Philippines issued executive orders to
create thirty-three municipalities pursuant to Section 69 of the Revised Administrative Code. Public
funds thereby stood to be disbursed in the implementation of said executive orders.

Issue: Whether the executive orders are null and void, upon the ground that the President does not
have the authority to create municipalities as this power has been vested in the legislative department.

Held:

Section 10(1) of Article VII of the fundamental law ordains:

The President shall have control of all the executive departments, bureaus or offices, exercise general
supervision over all local governments as may be provided by law, and take care that the laws be
faithfully executed.

The power of control under this provision 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. Such control does not include
the authority to either abolish an executive department or bureau, or to create a new one. Section 68 of
the Revised Administrative Code does not merely fail to comply with the constitutional mandate above
quoted, it also gives the President more power than what was vested in him by the Constitution.

The Executive Orders in question are hereby declared null and void ab initio and the respondent
permanently restrained from passing in audit any expenditure of public funds in implementation of said
Executive Orders or any disbursement by the municipalities referred to.
Tatad vs Secretary of Energy

G.R. No. 124360, November 5, 1997

Petitioner: Francis Tatad

Respondents: The Secretary of the Department of Energy and the Secretary of the Department of
Finance

Facts:

In December 9, 1992, the Department of Energy was created (through the enactment of R.A. No. 7638)
to control energy-related government activities. In March 1996, R.A. No. 8180 (Downstream Oil Industry
Deregulation Act of 1996) was enacted in pursuance to the deregulation of the power and energy thrust
under R.A. 7638. Under the R.A. No. 8180, any person or entity was allowed to import and market crude
oil and petroleum products, and to lease or own and operate refineries and other downstream oil
facilities.

Petitioner Francisco Tatad questions the constitutionality of Section 5 of R.A. No. 8180 since the
imposition of tarrif violates the equal protection clause and bars the entry of others in the oil industry
business. Also, the inclusion of tarrif violates Section 26 (1) of Article VI of the constitution requiring
every law to have only one subject which shall be expressed in its title.

In a separate petition (G.R. 127867), petitioners Edcel Lagman, Joker Arroyo, Enrique Garcia, Wigberto
Tanada, Flag Human Rights Foundation, Inc., Freedom from Debt Coalition and Sanlakas argued that R.A.
No. 8180, specifically Section 15 is unconstitutional because it: (1) gives undue delegation of legislative
power to the President and the Secretary of Energy by not providing a determinate or determinable
standard to guide the Executive Branch in determining when to implement the full deregulation of the
downstream oil industry; (2) Executive Order No. 392, an order declaring the implementation of the full
deregulation of the downstream oil industry, is arbitrary and unreasonable because it was enacted due
to the alleged depletion of the Oil Price Stabilization Plan- a condition not found in R.A. No. 8180; and
(3) Section 15 of R.A. No. 8180 and E.O. No. 392 allow the formation of a de facto cartel among Petron,
Caltex and Shell in violation of constitutional prohibition against monopolies, combinations in restraint
of trade and unfair competition.

Respondents, on the other hand, declares the petitions not justiciable (cannot be settled by the court)
and that the petitioners have no locus standi since they did not sustain direct injury as a result of the
implementation of R.A. No. 8180.
Issues:

1. Whether or not R.A. no. 8180 is unconstitutional.

2. Whether or not E. O. no. 392 is arbitrary and unreasonable.

3. Whether or not Section 5 of R.A. no. 8180 violates Section 26(1), Article VI of the Constitution.

4. Whether or not Section 15 of R.A. no. 8180 constitutes undue delegation of legislative power.

Held:

1. No, R.A. No. 8180 is unconstitutional. It violated Section 19, Article XII of the Constitution prohibiting
monopolies, combinations in restraint of trade and unfair competition. The deregulation act only
benefits Petron, Shell and Caltex, the three major league players in the oil industry.

2. Yes, Executive Order No. 392 was arbitrary and unreasonable and therefore considered void. The
depletion of OFSP is not one of the factors enumerated in R.A. No. 8180 to be considered in declaring
full deregulation of the oil industry. Therefore, the executive department, in its declaration of E.O. No.
392, failed to follow faithfully the standards set in R.A. No. 8180, making it void.

3. No, section 5 of R.A. No. 8180 does not violate Section 26(1), Article VI of the Constitution. A law
having a single general subject indicated in the title may contain any number of provisions as long as
they are not inconsistent with the foreign subject. Section 5 providing for tariff differential is germane to
the subject of the deregulation of the downstream industry which is R.A. No 8180, therefore it does not
violate the one title-one subject rule.

4. No, Section 15 did not violate the constitutional prohibition on undue delegation of legislative power.
The tests to determine the validity of delegation of legislative power are the completeness test and the
sufficiency test. The completeness test demands that the law must be complete in all its terms and
conditions such that when it reaches the delegate, all it must do is enforce it. The sufficiency test
demand an adequate guideline or limitation in the law to delineate the delegates authority. Section 15
provides for the time to start the full deregulation, which answers the completeness test. It also laid
down standard guide for the judgement 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 peso to dollar is stable- which answers the sufficiency test.

Decision:

The petitions were granted. R.A. No. 8180 was declared unconstitutional and E.O. No. 372 void.
Lupangco vs. CA (G.R. No. 77372)

Facts:

On or about October 6, 1986, herein respondent Professional Regulation Commission (PRC) issued
Resolution No. 105 as parts of its "Additional Instructions to Examinees," to all those applying for
admission to take the licensure examinations in accountancy:

No examinee shall attend any review class, briefing, conference or the like conducted by, or shall receive
any hand-out, review material, or any tip from any school, college or university, or any review center or
the like or any reviewer, lecturer, instructor official or employee of any of the aforementioned or similar
institutions during the three days immediately proceeding every examination day including examination
day.

Any examinee violating this instruction shall be subject to the sanctions prescribed by Sec. 8, Art. III of
the Rules and Regulations of the Commission.

On October 16, 1986, herein petitioners, all reviewees preparing to take the licensure examinations in
accountancy schedule on October 25 and November 2 of the same year, filed on their own behalf of all
others similarly situated like them, with the Regional Trial Court of Manila a complaint for injunction
with a prayer with the issuance of a writ of a preliminary injunction against respondent PRC to restrain
the latter from enforcing the above-mentioned resolution and to declare the same unconstitutional.

Respondent PRC filed a motion to dismiss on October 21, 1987 on the ground that the lower court had
no jurisdiction to review and to enjoin the enforcement of its resolution. In an Order of October 21,
1987, the lower court declared that it had jurisdiction to try the case and enjoined the respondent
commission from enforcing and giving effect to Resolution No. 105 which it found to be
unconstitutional. Not satisfied therewith, respondent PRC, on November 10, 1986, an appeal with the
Court of Appeals. The petition was granted.

Issue:

Whether or not Resolution No. 105 is constitutional.

Held:

CA stated as basis its conclusion that PCS and RTC are co-equal branches. They relied heavily on the case
of National Electrification Administration vs. Mendoza where the Court held that a Court of First
Instance cannot interfere with the orders of SEC, the two being a co-equal branch.
SC said the cases cited by CA are not in point. It is glaringly apparent that the reason why the Court ruled
that the Court of First Instance could not interfere with the orders of SEC was that this was provided for
by the law. Nowhere in the said cases was it held that a Court of First Instance has no jurisdiction over
all other government agencies. On the contrary, the ruling was specifically limited to the SEC. The
respondent court erred when it place he SEC and PRC in the same category. There is no law providing for
the next course of action for a party who wants to question a ruling or order of the PRC. What is clear
from PD No. 223 is that PRC is attached to the Office of the President for general direction and
coordination. Well settled in our jurisprudence the view that even acts of the Office of the President
may be reviewed by the RTC. In view of the foregoing, SC rules that RTC has jurisdiction to entertain the
case and enjoin PRC from enforcing its resolution.

As to the validity of Resolution No. 105, although the resolution has a commendable purpose which is to
preserve the integrity and purity of the licensure examinations, the resolution is unreasonable in that an
examinee cannot even attend and review class, briefing, conference or the like or receive hand-out,
review material, or any tip from any school, college or university, or any review center. The
unreasonableness is more obvious in that one who is caught committing the prohibited acts even
without ill motives will be barred from taking future examinations.

Resolution No. 105 is not only unreasonable and arbitrary, it also infringes on the examinees right to
liberty guaranteed by the Constitution. PRC has no authority to dictate on the reviewees as to how they
should prepare themselves for the licensure examinations specially if the steps they take are lawful.

Another evident objection to Resolution No. 105 is that it violates the academic freedom of the schools
concerned. PRC cannot interfere with the conduct of review that review schools and centers believe
would best enable their enrollees to pass the examination. Unless the means and methods of instruction
are clearly found to be inefficient, impractical, or riddled with corruption, review schools and centers
may not be stopped from helping out their students.

The enforcement of Resolution No. 105 is not a guarantee that the alleged leakages in the licensure
examinations will be eradicated or at least minimized. What is needed to be done by the respondent is
to find out the source of such leakages and stop it right there.

The decision of the CA was REVERSE and SET ASIDE.

ABS-CBN Broadcasting Corp. vs. Court of Tax Appeals [G.R. No. L-52306. October 12, 1981]

Facts:

During the period pertinent to this case, petitioner corporation was engaged in the business of
telecasting local as well as foreign films acquired from foreign corporations not engaged in trade or
business within the Philippines for which petitioner paid rentals after withholding income tax of 30%of
one-half of the film rentals. In implementing Section 4(b) of the Tax Code, the Commissioner issued
General Circular V-334. Pursuant thereto, ABS-CBN Broadcasting Corp. dutifully withheld and turned
over to the BIR 30% of of the film rentals paid by it to foreign corporations not engaged in trade or
business in the Philippines. The last year that the company withheld taxes pursuant to the Circular was
in 1968. On 27 June 1908, RA 5431 amended Section 24 (b) of the Tax Code increasing the tax rate from
30% to 35% and revising the tax basis from such amount referring to rents, etc. to gross income. In
1971, the Commissioner issued a letter of assessment and demand for deficiency withholding income
tax for years 1965 to 1968. The company requested for reconsideration; where the Commissioner did
not act upon.

Issue: Whether Revenue Memorandum Circular 4-71, revoking General Circular V-334, may be
retroactively applied.

Held:

Rulings or circulars promulgated by the Commissioner have no retroactive application where to so apply
them would be prejudicial to taxpayers. Herein, the prejudice the company of the retroactive
application of Memorandum Circular 4-71 is beyond question. It was issued only in 1971, or three years
after 1968, the last year that petitioner had withheld taxes under General Circular No. V-334. The
assessment and demand on petitioner to pay deficiency withholding income tax was also made three
years after 1968 for a period of time commencing in 1965. The company was no longer in a position to
withhold taxes due from foreign corporations because it had already remitted all film rentals and had no
longer control over them when the new circular was issued. Insofar as the enumerated exceptions are
concerned, the company does not fall under any of them.