1.G.R. Nos.

11270809 March 29, 1996

PETITIONER REPUBLIC OF THE PHILIPPINES, represented by PRESIDENTIAL COMMISSION
ON GOOD GOVERNMENT
RESPONDENTS SANDIGANBAYAN, SIPALAY TRADING CORPORATION and ALLIED BANKING
CORPORATION

Facts:

Petitioner PCGG issued separate orders against private respondents Sipalay Trading Corporation and Allied
Banking Corporation (hereinafter referred to as SIPALAY and ALLIED) to effect their sequestration. Two (2)
separate petitions were filed by SIPALAY and ALLIED before this Court assailing the sequestration orders.
After the consolidation of these petitions, this Court referred the cases to public respondent SANDIGANBAYAN
for proper disposition.

When Sandiganbayan directed the parties to the case to submit formal evidence in writing. However, PCGG
filed a "Motion To Dismiss" the petitions of SIPALAY and ALLIED on the ground of failure to exhaust
administrative remedies. PCGG argued that SIPALAY and ALLIED should have first appealed the
sequestration orders to the Office of the President before challenging them in court, invoking Sections 5 and 6
of the PCGG Rules and Regulations.

PCGG lost in the two petitions. In the SIPALAY petition, the Sandiganbayan predicating on PCGGs failure to
implead the petitioner within the period mandated under Section 26, Article XVIII of the 1987 Constitution and
for having issued the writ of sequestration without sufficient evidentiary foundation because PCGG failed to
adduce and proffer that quantum of evidence necessary for its validity.

In the ALLIED petition, Sandiganbayan held that the search and seizure order was issued without due process
and in contravention of the organic law then in force, the Freedom Constitution, under which mantle, the Bill of
Rights found in the 1973 Constitution was amply protected and enforced.

Issue/s:

Whether SANDIGANBAYAN's denial of the PCGG's motion to dismiss proper

Ruling:

Yes, SANDIGANBAYAN's denial of the PCGG's motion to dismiss was proper.

Ratio Decidendi:

As a general rule, a direct action in court without prior exhaustion of administrative remedies, when required, is
premature, warranting its dismissal on a motion to dismiss grounded on lack of cause of action.

However, the peculiarities of this case preclude the rightful application of the principles aforestated. The
SIPALAY and ALLIED petitions were both filed on the third quarter of 1986 (September 16 and August 26,
respectively), while the PCGG decided to file its motion to dismiss only in the middle of 1993 (July 7). Nearly
seven (7) years came to pass in between that so much has already transpired in the proceedings during the
interregnum.

SIPALAY and ALLIED had rested their cases, and the PCGG had finished presenting all its witnesses, not to
mention other various motions and incidents already disposed of by the SANDIGANBAYAN, with special
attention to the numerous postponements granted the PCGG for presentation of its evidence which prevented
an earlier termination of the proceedings. The motion to dismiss came only at the penultimate stage of the
proceedings where the remaining task left for the PCGG was to file its written formal offer of evidence as
required by the SANDIGANBAYAN.

With its undenied belated action, seven (7) years in the making at that, it is only proper to presume with
conclusiveness that the PCGG has abandoned or declined to assert what it bewailed as the SIPALAY and
ALLIED petitions' lack of cause of action.

Doctrines Learned:

A direct action in court without prior exhaustion of administrative remedies, when required, is
premature, warranting its dismissal on a motion to dismiss grounded on lack of cause of action.
 Failure to observe the doctrine of exhaustion of administrative remedies does not affect the jurisdiction
of the Court. The only effect of noncompliance with this rule is that it will deprive the complainant of a
cause of action, which is a ground for a motion to dismiss. If not invoked at the proper time, this ground
is deemed waived and the court can take cognizance of the case and try it.

2. G.R. No. 100127 April 23, 1993

PETITIONER JOSE D. LINA, JR.
RESPONDENTS ISIDRO D. CARINO, in his capacity as Secretary of Education, Culture and
Sports

Facts:

This is a Petition for Prohibition and Mandamus filed by petitioner Senator Jose D. Lina, Jr. principally as
taxpayer, against respondent Isidro D. Carino, in the latters capacity as the then Secretary of Department of
Education, Culture and Sports (DECS).

Petitioner disputes the legal authority of respondent Carino to issue DECS Order No. 30, series of 1991, dated
11 March 1991, entitled Guidelines on Tuition and/or other School Fees in Private Schools, Colleges and
Universities for School Year 1991-1992. It allows private schools to increase tuition and other school fees,
subject to the guidelines there set out.

Petitioner basically denies the legal authority of respondent Secretary to issue DECS Order No. 30. It is the
contention of the petitioner that respondent Secretary at the time of issuing DECS Order No. 30 no longer
possessed legal authority to do so, considering that authority to promulgate rules and regulations relating to
the imposition of school fees had been transferred to the State Assistance Council (SAC) by Republic Act No.
6728 (An Act Providing Government Assistance to Students and Teachers in Private Education, and
Appropriating Funds therefor).

Issue/s:

Whether DECS Secretary Carino has legal authority to issue DECS Order No. 30

Ruling:

Yes, Secretary Carino has legal authority to issue DECS Order No. 30.

Ratio Decidendi:

After careful examination of the provisions of both P.D. No. 451 (Authorizing The Secretary of Education and
Culture to Regulate the Imposition of Tuition and Other School Fees) and B.P. Blg. 232 (An Act Providing for
the Establishment and Maintenance of an Integrated System of Education), and the opinions of the Court in
Phil. Consumer case and the Cebu Institute case, the Court considers that the legal authority of respondent
DECS Secretary to set maximum permissible rates or levels of tuition and other school fees, and to issue
guidelines for the imposition and collection thereof, like DECS Order No. 30, must be sustained.

The Court is unable to agree with Linas contention. We do not see how R.A. No. 6728 could be regarded as
vesting upon the SAC the legal authority to establish maximum permissible tuition and other school fees for
private schools.

As earlier noted, R.A. No. 6728 deals with government assistance to students and teachers in private schools;
it does not, in other words, purport to deal at all with the question of authority to fix maximum collectible tuition
and other school fees. R.A. No. 6728 did authorize the SAC to issue rules and regulations; but the rules and
regulations which may be promulgated by the SAC must relate to the authority granted by R.A. No. 6728 to the
SAC. It is axiomatic that a rule or regulation must bear upon, and be consistent with the provisions of the
enabling statute if such rule or regulation is to be valid.

The SAC was authorized to define the classes of students who may be entitled to claim government financial
assistance. Under the statute, students of schools charging tuition and other school fees in excess of certain
identified rate or levels thereof shall not be entitled to claim government assistance or subsidies. The
specification of such levels of tuition and other school fees for purposes of qualifying (or disqualifying) the
students in such schools for government financial assistance is one thing; this is the task SAC was authorized
to carry out through the promulgation of rules and regulations. The determination of the levels of tution and
other school fees which may lawfully be charged by any private school, is clearly another matter; this task is
vested in respondent Secretary.

Page 2 of 4
Doctrine Learned:

A rule or regulation must bear upon, and be consistent with the provisions of its enabling statute.

3. G.R. No. 101344 October 1, 1992

PETITIONER ASSET PRIVATIZATION TRUST, as Trustee of the Government of the Republic
of the Philippines
RESPONDENTS COURT OF APPEALS, JOB C. MADAYAG Presiding Judge of the Regional Trial
Court of Makati, Br. 145, and JOHANNESBURG PACKAGING CORP.

Facts:

On 1 August 1986, the Paragon Paper Plant was sold in public auction by the Development Bank of the
Philippines (DBP) Inc., over the latters parcels of land in Orani, Bataan, including the improvements,
machinery and equipment thereon. Private respondent Johannesberg Packaging Corporation (JPC) with its
cash bid of P120,579,000.00 won in the bidding.

On 22 May 1987, by reason of JPCs failure to pay the full amount of its cash bid within the stipulated period,
including the extensions it obtained, DBP rescinded the sale. To avoid the rescission, JPC filed an action
before the RTC docketed as Civil Case No. 16960, captioned Johannesberg Packaging Corporation and
Romeo Cabalinan vs. Development Bank of the Philippines.

On 10 June 1987, the trial court issued a restraining order directing DBP therein and all persons acting under
them to desist from implementing the order of 22 May 1987 rescinding the Award of Sale in favor of JPC and
the repossession/take-over from JPC of the Paragon Paper Mill/Plant and facilities at Orani, Bataan, scheduled
on 15 June 1987.

Issue/s:

Whether the trial court has the authority to issue a restraining order or a writ of injunction against APT in Civil
Case No. 16960

Ruling:

No, the trial court has the authority to issue a restraining order or a writ of injunction against APT in Civil Case
No. 16960.

Ratio Decidendi:

No restraining order lies against APT in view of Sec. 31 of Proclamation No. 50-A dated 15 December 1986
which provides:

No court or administrative agency shall issue any restraining order or injunction against the
Trust in connection with the acquisition, sale or disposition of assets transferred to it x x x Nor
shall such order or injunction be issued against any purchaser of assets sold by the Trust to
prevent such purchaser from taking possession of any assets purchased by him.

Indeed, this is not the first time that the propriety of the issuance of the writ by the lower court against APT was
raised. In Manstruste Systems, Inc. v. Court of Appeals, this Court through Mme. Justice Carolina Grino-
Aquino, ruled that:

Courts may not substitute their judgment for that of APT, nor block by injunction the discharge
of its functions and the implementation of its decision in connection with the acquisition, sale or
disposition of assets transferred to it.

We have expressly ruled therein, in addition, that Proclamation No. 50-A does not infringe any provision of the
Constitution. Thus:

The President, in the exercise of her legislative power under the Freedom Constitution; issued
Proclamation No. 50-A prohibiting the courts from issuing restraining orders and writs of
injunction against APT and the purchasers of any assets sold by it, to prevent courts from
interfering the discharge, by this instrumentality of the executive branch of the Government, of
its tasks of carrying out the expeditious disposition and privatization of certain government

Page 3 of 4
 corporations and/or the assets thereof (Proc. No. 50), absent any grave abuse of discretion
amounting to excess or lack of jurisdiction on its part. This proclamation, not being inconsistent
with the Constitution and not having been repealed or revoked by Congress, has remained
operative (Sec. 3, Art XVIII, 1987 Constitution.)

Quite significantly, the records do not disclose any grave abuse of discretion committed by petitioner
amounting to excess or lack of jurisdiction in its effort to take possession of the assets transferred to it by DBP.
Petitioner simply availed of judicial processes to recover the transferred assets formerly owned by private
respondent.

In fine, the Court held that respondent Judge has no authority to issue any restraining order or injunction
against petitioner APT absent any grave abuse of discretion on the part of petitioner amounting to excess or
lack of jurisdiction.

Doctrine Learned:

Courts are prevented from interfering with the discharge of tasks of an instrumentality of the executive branch
absent any grave abuse of discretion amounting to excess or lack of jurisdiction on its part.

4. G.R. No. L-21685 April 30, 1966

PETITIONER- CLETO ASPREC
APPELLANT
RESPONDENTS- VICTORIANO ITCHON, JOSE SUGUITAN, FELIPE P. CRUZ, THE EXECUTIVE
APPELLEES SECRETARY, NICANOR G. JORGE, ANTONIO NOBLEJAS,1 and JACINTO
HERNANDEZ

Facts:

An administrative complaint for unprofessional conduct was filed against Asprec with the Board of Examiners
for Surveyors. The complaint alleged that Asprec received compensation from Hernandez but failed his
obligation to survey and deliver a plan to Hernandez. The board found for Hernandez and revoked and
required surrender of Asprecs certificate of registration as a private land surveyor. Office of the President
affirmed. Asprec went to CFI on certiorari which was denied. Appeal of CFI decision to SC.

Issue/s:

Whether Asprec was denied his day in court

Ruling:

No, Asprec was not denied his day in court.

Ratio Decidendi:

From the facts, petitioner has had more than ample opportunity to defend himself before the board. But he and
counsel did not appear at the last and stipulated date of hearing without cause or without any excuse at all.
Presence of a party at a trial, petitioner concedes, is not always of the essence of due process. Really, all that
the law requires is that parties be given notice of trial, an opportunity to be heard. More than this, the date of
trial had been previously agreed upon by the parties and their counsel. He has forfeited his right to be heard in
his defense.

Doctrine Learned:

Administrative due process requires delivery of notice of trial, an opportunity to be heard.

Page 4 of 4