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SECOND DIVISION administrative cases, which were filed with the Office of the President, were

subsequently referred to the Office of the Solicitor General for investigation.


Charges of violations of R.A. No. 3019, 3 (e) and R.A. No. 992, 20-21 and
[G.R. No. 106296. July 5, 1996] R.A. No. 733, 14 were likewise filed against him with the Office of
Tanodbayan.
On June 14, 1976, three (3) informations for violation of Sec. 3 (e) of the
Anti-Graft and Corrupt Practices Act (R.A. No. 3019, as amended) were filed
ISABELO T. CRISOSTOMO, petitioner, vs. THE COURT OF APPEALS and against him. The informations alleged that he appropriated for himself
the PEOPLE OF THE PHILIPPINES, respondents.* a bahay kubo, which was intended for the College, and construction materials
worth P250,000.00, more or less. Petitioner was also accused of using a
DECISION driver of the College as his personal and family driver.[1]
MENDOZA, J.: On October 22, 1976, petitioner was preventively suspended from office
pursuant to R.A. No. 3019, 13, as amended. In his place Dr. Pablo T. Mateo,
This is a petition to review the decision of the Court of Appeals dated July Jr. was designated as officer-in-charge on November 10, 1976, and then as
15, 1992, the dispositive portion of which reads: Acting President on May 13, 1977.
On April 1, 1978, P.D. No. 1341 was issued by then President Ferdinand
WHEREFORE, the present petition is partially granted. The questioned Orders E. Marcos, CONVERTING THE PHILIPPINE COLLEGE OF COMMERCE INTO A
and writs directing (1) reinstatement of respondent Isabelo T. Crisostomo to POLYTECHNIC UNIVERSITY, DEFINING ITS OBJECTIVES, ORGANIZATIONAL
the position of President of the Polytechnic University of the Philippines, and STRUCTURE AND FUNCTIONS, AND EXPANDING ITS CURRICULAR
(2) payment of salaries and benefits which said respondent failed to receive OFFERINGS.
during his suspension insofar as such payment includes those accruing after
the abolition of the PCC and its transfer to the PUP, are hereby set Mateo continued as the head of the new University. On April 3, 1979, he
aside. Accordingly, further proceedings consistent with this decision may be was appointed Acting President and on March 28, 1980, as President for a
taken by the court a quo to determine the correct amounts due and payable term of six (6) years.
to said respondent by the said university.
On July 11, 1980, the Circuit Criminal Court of Manila rendered judgment
acquitting petitioner of the charges against him. The dispositive portion of the
The background of this case is as follows: decision reads:
Petitioner Isabelo Crisostomo was President of the Philippine College of
Commerce (PCC), having been appointed to that position by the President of WHEREFORE, the Court finds the accused, Isabelo T. Crisostomo, not guilty of
the Philippines on July 17, 1974. the violations charged in all these three cases and hereby acquits him
therefrom, with costs de oficio. The bail bonds filed by said accused for his
During his incumbency as president of the PCC, two administrative cases provisional liberty are hereby cancelled and released.
were filed against petitioner for illegal use of government vehicles,
misappropriation of construction materials belonging to the college,
Pursuant to the provisions of Section 13, R.A. No. 3019, as amended,
oppression and harassment, grave misconduct, nepotism and dishonesty. The
otherwise known as The Anti-Graft and Corrupt Practices Act, and under
which the accused has been suspended by this Court in an Order dated did not vacate the office as he wanted to consult with the President of the
October 22, 1976, said accused is hereby ordered reinstated to the position of Philippines first. This led to a contempt citation against Dr. Gellor. A hearing
President of the Philippine College of Commerce, now known as the was set on May 7, 1992. On May 5, 1992, petitioner also moved to cite
Polytechnic University of the Philippines, from which he has been Department of Education, Culture and Sports Secretary Isidro Cario in
suspended. By virtue of said reinstatement, he is entitled to receive the contempt of court. Petitioner assumed the office of president of the PUP.
salaries and other benefits which he failed to receive during suspension,
On May 18, 1992, therefore, the People of the Philippines filed a petition
unless in the meantime administrative proceedings have been filed against
him. for certiorari and prohibition (CA G.R. No. 27931), assailing the two orders
and the writs of execution issued by the trial court. It also asked for a
temporary restraining order.
The bail bonds filed by the accused for his provisional liberty in these cases
are hereby cancelled and released. On June 25, 1992, the Court of Appeals issued a temporary restraining
order, enjoining petitioner to cease and desist from acting as president of the
SO ORDERED. PUP pursuant to the reinstatement orders of the trial court, and enjoining
further proceedings in Criminal Cases Nos. VI-2329-2331.
The cases filed before the Tanodbayan (now the Ombudsman) were On July 15, 1992, the Seventh Division of the Court of Appeals rendered
likewise dismissed on August 8, 1991 on the ground that they had become a decision,[2] the dispositive portion of which is set forth at the beginning of
moot and academic. On the other hand, the administrative cases were this opinion. Said decision set aside the orders and writ of reinstatement
dismissed for failure of the complainants to prosecute them. issued by the trial court. The payment of salaries and benefits to petitioner
On February 12, 1992, petitioner filed with the Regional Trial Court a accruing after the conversion of the PCC to the PUP was disallowed.Recovery
motion for execution of the judgment, particularly the part ordering his of salaries and benefits was limited to those accruing from the time of
reinstatement to the position of president of the PUP and the payment of his petitioners suspension until the conversion of the PCC to the PUP. The case
salaries and other benefits during the period of suspension. was remanded to the trial court for a determination of the amounts due and
payable to petitioner.
The motion was granted and a partial writ of execution was issued by the
trial court on March 6, 1992. On March 26, 1992, however, President Corazon Hence this petition. Petitioner argues that P.D. No. 1341, which converted
C. Aquino appointed Dr. Jaime Gellor as acting president of the PUP, following the PCC into the PUP, did not abolish the PCC. He contends that if the law had
the expiration of the term of office of Dr. Nemesio Prudente, who had intended the PCC to lose its existence, it would have specified that the PCC
succeeded Dr. Mateo. Petitioner was one of the five nominees considered by was being abolished rather than converted and that if the PUP was intended
the President of the Philippines for the position. to be a new institution, the law would have said it was being created.
Petitioner claims that the PUP is merely a continuation of the existence of the
On April 24, 1992, the Regional Trial Court, through respondent Judge PCC, and, hence, he could be reinstated to his former position as president.
Teresita Dy-Liaco Flores, issued another order, reiterating her earlier order for
the reinstatement of petitioner to the position of PUP president. A writ of In part the contention is well taken, but, as will presently be explained,
execution, ordering the sheriff to implement the order of reinstatement, was reinstatement is no longer possible because of the promulgation of P.D. No.
issued. 1437 by the President of the Philippines on June 10, 1978.

In his return dated April 28, 1992, the sheriff stated that he had executed P.D. No. 1341 did not abolish, but only changed, the former Philippine
the writ by installing petitioner as President of the PUP, although Dr. Gellor College of Commerce into what is now the Polytechnic University of the
Philippines, in the same way that earlier in 1952, R.A. No. 778 had converted President. The Secretary of the Department shall be the ex-officio Chairman
what was then the Philippine School of Commerce into the Philippine College of the Commission, while the Vice-Chairman shall act as the executive officer
of Commerce. What took place was a change in academic status of the of the Commission.
educational institution, not in its corporate life. Hence the change in its name,
the expansion of its curricular offerings, and the changes in its structure and xxx xxx xxx
organization.
As petitioner correctly points out, when the purpose is to abolish a 90. Status of Present NAPOLCOM, PC-INP. - Upon the effectivity of this Act,
department or an office or an organization and to replace it with another one, the present National Police Commission, and the Philippine Constabulary-
the lawmaking authority says so. He cites the following examples: Integrated National Police shall cease to exist. The Philippine Constabulary,
which is the nucleus of the integrated Philippine Constabulary-Integrated
National Police, shall cease to be a major service of the Armed Forces of the
E.O. No. 709:
Philippines. The Integrated National Police, which is the civilian component of
the Philippine Constabulary-Integrated National Police, shall cease to be the
1. There is hereby created a Ministry of Trade and Industry, hereinafter national police force and in lieu thereof, a new police force shall be
referred to as the Ministry. The existing Ministry of Trade established established and constituted pursuant to this Act.
pursuant to Presidential Decree No. 721 as amended, and the existing
Ministry established pursuant to Presidential Decree No. 488 as amended, are
In contrast, P.D. No. 1341, provides:
abolished together with their services, bureaus and similar agencies, regional
offices, and all other entities under their supervision and control. . . .
1. The present Philippine College of Commerce is hereby converted into a
university to be known as the Polytechnic University of the Philippines,
E.O. No. 710:
hereinafter referred to in this Decree as the University.
1. There is hereby created a Ministry of Public Works and Highways,
As already noted, R.A. No. 778 earlier provided:
hereinafter referred to as the Ministry. The existing Ministry of Public Works
established pursuant to Executive Order No. 546 as amended, and the
existing Ministry of Public Highways established pursuant to Presidential 1. The present Philippine School of Commerce, located in the City of Manila,
Decree No. 458 as amended, are abolished together with their services, Philippines, is hereby granted full college status and converted into the
bureaus and similar agencies, regional offices, and all other entities within Philippine College of Commerce, which will offer not only its present one-year
their supervision and control. . . . and two-year vocational commercial curricula, the latter leading to the titles
of Associate in Business Education and/or Associate in Commerce, but also
four-year courses leading to the degrees of Bachelor of Science in Business in
R.A. No. 6975:
Education and Bachelor of Science in Commerce, and five-year courses
leading to the degrees of Master of Arts in Business Education and Master of
13. Creation and Composition. - A National Police Commission, hereinafter Arts in Commerce, respectively.
referred to as the Commission, is hereby created for the purpose of
effectively discharging the functions prescribed in the Constitution and
The appellate court ruled, however, that the PUP and the PCC are not one
provided in this Act. The Commission shall be a collegial body within the
and the same institution but two different entities and that since petitioner
Department. It shall be composed of a Chairman and four (4) regular
Crisostomos term was coterminous with the legal existence of the PCC,
commissioners, one (1) of whom shall be designated as Vice-Chairman by the
petitioners term expired upon the abolition of the PCC. In reaching this . . . owned by the Philippine College of Commerce and such other National
conclusion, the Court of Appeals took into account the following: Schools as may be integrated . . . including
their obligations and appropriations . . . (Sec. 12; Italics supplied).[3]
a) After respondent Crisostomos suspension, P.D. No. 1341 (entitled
CONVERTING THE PHILIPPINE COLLEGE OF COMMERCE INTO A POLYTECHNIC But these are hardly indicia of an intent to abolish an existing institution
UNIVERSITY, DEFINING ITS OBJECTIVES, ORGANIZATIONAL STRUCTURE and to create a new one. New course offerings can be added to the curriculum
AND FUNCTIONS, AND EXPANDING ITS CURRICULAR OFFERINGS) was issued of a school without affecting its legal existence. Nor will changes in its existing
on April 1, 1978. This decree explicitly provides that PUPs objectives and structure and organization bring about its abolition and the creation of a new
purposes cover not only PCCs offering of programs in the field of commerce one. Only an express declaration to that effect by the lawmaking authority
and business administration but also programs in other polytechnic areas and will.
in other fields such as agriculture, arts and trades and fisheries . . . (section
The Court of Appeals also cites the provision of P.D. No. 1341 as allegedly
2). Being a university, PUP was conceived as a bigger institution absorbing,
merging and integrating the entire PCC and other national schools as may be implying the abolition of the PCC and the creation of a new one the PUP in its
stead:
transferred to this new state university.

b) The manner of selection and appointment of the university head is 12. All parcels of land, buildings, equipment and facilities owned by the
Philippine College of Commerce and such other national schools as may be
substantially different from that provided by the PCC Charter. The PUP
President shall be appointed by the President of the Philippines upon integrated by virtue of this decree, including their obligations and
appropriations thereof, shall stand transferred to the Polytechnic University of
recommendation of the Secretary of Education and Culture after consultation
with the University Board of Regents (section 4, P.D. 1341). The President of the Philippines, provided, however, that said national schools shall continue to
receive their corresponding shares from the special education fund of the
PCC, on the other hand, was appointed by the President of the
Philippines upon recommendation of the Board of Trustees (Section 4, R.A. municipal/provincial/city government concerned as are now enjoyed by them
in accordance with existing laws and/or decrees.
778).

c) The composition of the new universitys Board of Regents is likewise The law does not state that the lands, buildings and equipment owned by
the PCC were being transferred to the PUP but only that they stand
different from that of the PCC Board of Trustees (which included the chairman
of the Senate Committee on Education and the chairman of the House transferred to it. Stand transferred simply means, for example, that lands
transferred to the PCC were to be understood as transferred to the PUP as the
Committee on Education, the President of the PCC Alumni Association as well
as the President of the Chamber of Commerce of the Philippines). Whereas, new name of the institution.
among others, the NEDA Director-General, the Secretary of Industry and the But the reinstatement of petitioner to the position of president of the PUP
Secretary of Labor are members of the PUP Board of Regents. (Section 6, could not be ordered by the trial court because on June 10, 1978, P.D. No.
P.D. 1341). 1437 had been promulgated fixing the term of office of presidents of state
universities and colleges at six (6) years, renewable for another term of six
d) The decree moreover transferred to the new university all the properties (6) years, and authorizing the President of the Philippines to terminate the
including equipment and facilities: terms of incumbents who were not reappointed. P.D. No. 1437 provides:
6. The head of the university or college shall be known as the President of the the amount due and payable to petitioner by the university up to March 28,
university or college. He shall be qualified for the position and appointed for a 1980.
term of six (6) years by the President of the Philippines upon recommendation
of the Secretary of Education and Culture after consulting with the Board SO ORDERED.
which may be renewed for another term upon recommendation of the
Secretary of Education and Culture after consulting the Board. In case of
vacancy by reason of death, absence or resignation, the Secretary of
Education and Culture shall have the authority to designate an officer in
charge of the college or university pending the appointment of the President.

The powers and duties of the President of the university or college, in addition
to those specifically provided for in this Decree shall be those usually
pertaining to the office of the president of a university or college.

7. The incumbent president of a chartered state college or university whose


term may be terminated according to this Decree, shall be entitled to full
retirement benefits: provided that he has served the government for at least
twenty (20) years; and provided, further that in case the number of years
served is less than 20 years, he shall be entitled to one month pay for every
year of service.

In this case, Dr. Pablo T. Mateo Jr., who had been acting president of the
university since April 3, 1979, was appointed president of PUP for a term of
six (6) years on March 28, 1980, with the result that petitioners term was cut
short. In accordance with 7 of the law, therefore, petitioner became entitled
only to retirement benefits or the payment of separation pay.Petitioner must
have recognized this fact, that is why in 1992 he asked then President Aquino
to consider him for appointment to the same position after it had become
vacant in consequence of the retirement of Dr. Prudente.
WHEREFORE, the decision of the Court of Appeals is MODIFIED by
SETTING ASIDE the questioned orders of the Regional Trial Court directing
the reinstatement of the petitioner Isabelo T. Crisostomo to the position of
president of the Polytechnic University of the Philippines and the payment to
him of salaries and benefits which he failed to receive during his suspension
in so far as such payment would include salaries accruing after March 28,
1980 when petitioner Crisostomos term was terminated. Further proceedings
in accordance with this decision may be taken by the trial court to determine
Republic of the Philippines 1.3 First Vice-President
SUPREME COURT
Manila 1.4 Second Vice-President

EN BANC 1.5 Third Vice-President

1.6 Auditor

G.R. No. 115844 August 15, 1997 1.7 Five (5) Directors

CESAR G. VIOLA, Chairman, Brgy. 167, Zone 15, District II, §2. National Liga. The National Liga shall directly elect the following officers
Manila, petitioner, and directors to constitute the National Liga Board of Directors namely:
vs.
2.1 President
HON. RAFAEL M. ALUNAN III, Secretary DILG, ALEX L. DAVID,
President/Secretary General, National Liga ng mga Barangay, 2.2 Executive Vice-President
LEONARDO L. ANGAT, President, City of Manila, Liga ng mga
Barangay, respondents. 2.3 First Vice-President

2.4 Second Vice-President

MENDOZA, J.: 2.5 Third Vice-President

This is a petition for prohibition challenging the validity of Art. III, §§ 1-2 of 2.6 Secretary General
the Revised Implementing Rules and Guidelines for the General Elections of
2.7 Auditor
the Liga ng mga Barangay Officers so far as they provide for the election of
first, second and third vice presidents and for auditors for the National Liga ng 2.8 Five (5) Directors
mga Barangay and its chapters. The provisions in question read:
Petitioner Cesar G. Viola brought this action as barangay chairman of Brgy.
§1. Local Liga Chapters. The Municipal, City, Metropolitan and Provincial 167, Zone 15, District II, Manila against then Secretary of Interior and Local
Chapters shall directly elect the following officers and directors to constitute Government Rafael M. Alunan III, Alex L. David, president/secretary general
their respective Board of Directors, namely: of the National Liga ng mga Barangay, and Leonardo L. Angat, president of
the City of Manila Liga ng mga Barangay, to restrain them from carrying out
1.1 President
the elections for the questioned positions on July 3, 1994.
1.2 Executive Vice-President
Petitioner's contention is that the positions in question are in excess of those members to constitute the Board of Directors of their respective chapter.
provided in the Local Government Code (R.A. No. 7160), §493 of which Thereafter, the Board shall appoint a secretary, treasurer, and public relations
mentions as elective positions only those of president, vice president, and five officer from among the five (5) members, with the rest serving as Directors of
members of the board of directors in each chapter at the municipal, city, Board. The Board may create such other positions as it may deem necessary
provincial, metropolitan political subdivision, and national levels. Petitioner for the management of the chapter. Pending elections of the president of the
argues that, in providing for the positions of first, second and third vice municipal, city, provincial and metropolitan chapters of the Liga, the
presidents and auditor for each chapter, §§1-2 of the Implementing Rules incumbent presidents of the ABCs of the municipality, city province and
expand the number of positions authorized in §493 of the Local Government Metropolitan Manila shall continue to act as presidents of the corresponding
Code in violation of the principle that implementing rules and regulations Liga chapters, subject to the provisions of the Local Government Code of
cannot add or detract from the provisions of the law they are designed to 1991.
implement.
Sec. 2. Organization of Board of Directors of the National Liga. — The
Although the elections are now over, the issues raised in this case are likely National Liga shall be composed of the presidents of the provincial Liga
to arise again in future elections of officers of the Liga ng mga Barangay. For chapters, highly urbanized and independent component city chapters, and the
one thing, doubt may be cast on the validity of the acts of those elected. For metropolitan chapter who shall directly elect their respective officers, namely,
another, this comes within the rule that courts will decide a question which is a president, executive vice president; first, second, and third vice president,
otherwise moot and academic if it is "capable of repetition, yet evading auditor, secretary general; and five (5) members to constitute the Board of
review."1 Directors of the National Liga. Thereafter, the Board shall appoint a treasurer,
secretary and public relations officers from among the five (5) members with
We will therefore proceed to the merits of this case. the rest serving as directors of the Board. The Board may create such other
positions as it may deem necessary for the management of the National Liga.
Petitioner's contention that the additional positions in question have been
Pending election of Secretary-General, the incumbent president of the
created without authority of law is untenable. To begin with, the creation of
Pambansang Katipunan ng mga Barangay (PKB) shall act as the Secretary-
these positions was actually made in the Constitution and By-laws of the Liga
General. The incumbent members of the Board of the PKB, headed by the
ng Mga Barangay, which was adopted by the First Barangay National
Secretary-General who continue to be presidents of the respective chapters of
Assembly on January 11, 1994. This Constitution and By-laws provide in
the Liga to which they belong, shall constitute a committee to exercise the
pertinent parts:
powers and duties of the National Liga and with the primordial responsibility
ARTICLE VI of drafting a Constitution and By-Laws needed for the organization of the Liga
as a whole pursuant to the provisions of the Local Government Code of 1991.
OFFICERS AND DIRECTORS
The post of executive vice president is in reality that of the vice president in
Sec. 1. Organization of Board of Directors of Local Chapters. — The chapters §493 of the LGC, so that the only additional positions created for each
shall directly elect their respective officers, namely, a president; executive chapter in the Constitution and By-laws are those of first, second and third
vice president; first, second, and third vice presidents; auditor; and five (5)
vice presidents and auditor. Contrary to petitioner's contention, the creation deemed necessary for the management of the chapter[s]," embodies a fairly
of the additional positions is authorized by the LGC which provides as follows: intelligible standard. There is no undue delegation of power by Congress.

§493. Organization. The liga at the municipal, city, provincial, Metropolitan Justice Davide contends in dissent, however, that "only the Board of Directors
political subdivision, and national levels directly elect a president, a vice- — and not any other body — is vested with the power to create other
president, and five (5) members of the board of directors. The board positions as may be necessary for the management of the chapter" and that,
shall appoint its secretary and treasurer and create such other positions as it in any case, there is no showing that the Barangay National Assembly was
may deem necessary for the management of the chapter. A secretary-general authorized to draft the Constitution and By-laws because he is unable to find
shall be elected form among the members of the national liga and shall be any creating it. The Barangay National Assembly is actually the Pambansang
charged with the overall operation of the liga on the national level. The board Katipunan ng mga Barangay (PKB) referred to in Art. 210(f)(2)(3) of the
shall coordinate the activities of the chapters of the liga. (emphasis added) Rules and Regulations Implementing the Local Government Code of 1991,
which Justice Davide's dissent cites. It will be helpful to quote these
This provision in fact requires — and not merely authorizes the board of provisions:
directors to "create such other positions as it may deem necessary for the
management of the chapter" and belies petitioner's claim that said provision (2) A secretary-general shall be elected from among the members of the
(§493) limits the officers of a chapter to the president, vice president, five national liga who shall be responsible for the overall operation of the liga.
members of the board of directors, secretary, and treasurer. That Congress Pending election of a secretary-general under this rule, the incumbent
can delegate the power to create positions such as these has been settled by president of the pambansang katipunan ng mga barangay shall act as the
our decisions upholding the validity of reorganization statutes authorizing the secretary-general. The incumbent members of the board of the pambansang
President of the Philippines to create, abolish or merge officers in the katipunan ng mga barangay, headed by the secretary-general, who continue
executive department.2 The question is whether, in making a delegation of to be presidents of the respective chapters of the liga to which they belong,
this power to the board of directors of each chapter of the Liga ng Mga shall constitute a committee to exercise the powers and duties of the national
Barangay, Congress provided a sufficient standard so that, in the phrase of liga and draft or amend the constitution and by-laws of the national liga to
Justice Cardozo, administrative discretion may be "canalized within proper conform to the provisions of this Rule.
banks that keep it from overflowing."3
(3) The board of directors shall coordinate the activities of the various
Statutory provisions authorizing the President of the Philippines to make chapters of the liga.
reforms and changes in government owned or controlled corporations for the
purpose of promoting "simplicity, economy and efficiency" 4 in their operations (Emphasis added)
and empowering the Secretary of Education to prescribe minimum standards
Pursuant to these provisions, pending the organization of the Liga ng mga
of "adequate and efficient instruction" 5 in private schools and colleges have
Barangay, the board of directors of the PKB was constituted into a committee,
been found to be sufficient for the purpose of valid delegation. Judged by
headed by the PKB president, who acted as secretary general, with a two-fold
these cases, we hold that §493 of the Local Government Code, in directing
mandate: "[I] exercise the powers and duties of the national liga and [2]
the board of directors of the liga to "create such other positions as may be
draft or amend the constitution and by-laws of the national liga to conform to
the provisions of this Rule." The board of directors of the PKB, functioning in §493. Organization. — The liga at the municipal, city, provincial, metropolitan
place of the board of directors of the National Liga ng mga Barangay, political subdivision, and national levels directly elect a president, a vice-
exercised one of these powers of the National Liga board, namely, to create president, and five (5) members of the board of directors. The board shall
additional positions which it deemed necessary for the management of a appoint its secretary and treasurer and create such other positions as it may
chapter. There is therefore no basis for the claim that because the power to deem necessary for the management of the chapter. A secretary-general shall
create additional positions in the Liga on its chapters is vested only in the be elected from among the members of the national liga and shall be charged
board of directors the exercise of this power by the Barangay National with the overall operation of the liga on the national level. The board shall
Assembly is unauthorized and illegal and positions created are void. The coordinate the activities of the chapters of the liga.
Barangay National Assembly was actually the Pambansang Katipunan ng mga
Barangay or PKB. Pending the organization of the Liga ng mga Barangay, it (Emphasis added)
served as the Liga.
While the board of directors of a local chapter can create additional positions
But it is contended in the dissent that "Section 493 of the LGC . . . vests the to provide for the needs of the chapter, the board of directors of the National
power to create additional positions in the Board of Directors of the chapter." Liga must be deemed to have the power to create additional positions not
The implication seems to be that the board of the directors at the national only for its management but also for that of all the chapters at the municipal,
level did not have that power. It is necessary to consider the organizational city, provincial and metropolitan political subdivision levels. Otherwise the
structure of the Liga ng mga Barangay as provided in the LGC, as follows: National Liga would be no different from the local chapters. There would then
be only so many local chapters without a national one, when what is
§492. Representation, Chapters, National Liga. — Every barangay shall be contemplated in the above-quoted provisions of the LGC is that there should
represented in said liga by the punong barangay, or in his absence or be one Liga ng mga Barangay with local chapters at all levels of local
incapacity, by a sangguniang member duly elected for the purpose among its government units. The dissent, by denying to the board of directors at the
members, who shall attend all meetings or deliberations called by the National Liga the power to create additional positions in the local chapters,
different chapters of the liga. would reduce such board to a board of a local chapter. The fact is that §493
grants the power to create positions not only to the boards of the local
The liga shall have chapters at the municipal, city, provincial and chapters but to the board of the Liga at the national level as well.
metropolitan political subdivision levels.
Indeed what was done in the Constitution and By-laws of their liga was to
The municipal and city chapters of the liga shall be composed of the barangay create additional positions in each chapters, whether national or local, without
representatives of municipal and city barangays, respectively. The duly however precluding the boards of directors of the chapters as well as that of
elected presidents of component municipal and city chapters shall constitute the national liga from creating other positions for their peculiar needs. The
the provincial chapter or the metropolitan political subdivision chapter. The creation by the board of the National Liga of the positions of first, second and
duly elected presidents of highly-urbanized cities, provincial chapters, the third vice presidents, auditors and public relations officers was intended to
Metropolitan Manila chapter and metropolitan political subdivision chapters provide uniform officers for the various chapters in line with the mandate in
shall constitute the National Liga ng mga Barangay. Art. 210(g)(2) of the Rules and Regulations Implementing the Local
Government Code of 1991 to the Barangay National Assembly to
"formulate uniform constitution and by-laws applicable to the national liga
and all local chapters." The various chapters could have different minor
officers depending on their local needs, but they must have the same major Separate Opinions
elective officers, meaning to say, the additional vice-presidents and auditors.

The dissent further argues that, following the rule of ejusdem generis, what
DAVIDE, JR., J., dissenting;
may be created as additional positions can only be appointive ones because
the positions of secretary and treasurer are appointive positions. The rule In light of the disclosure in the revised ponencia that the creation of the
might apply if what is involved is the appointment of other officers. But what questioned additional positions of Executive Vice-President, First, Second and
we are dealing with in this case is the creation of additional positions. Section Third Vice-Presidents, and Auditor, embodied in Article III of the Revised
493 actually gives the board the power to "[1] appoint its secretary and Implementing Rules and Guidelines for the General Elections of Liga ng Mga
treasurer and [2] create such other positions as it may deem necessary for Barangay Officers was made by way of the Constitution and By Laws adopted
the management of the chapter." The additional positions to be created need by the First Barangay National Assembly on 11 January 1994, the ultimate
not therefore be appointive positions. issue then to be resolved is whether or not the Barangay Assembly is
empowered to create said additional positions.
Nor is it correct to say that §493, in providing that additional positions to be
created must be those which are "deemed necessary for the management of Section 493 of the Local Government Code of 1991 (LGC) specifically provides
the chapter," contemplates only appointive positions. Management positions as follows:
are not necessarily limited to appointive positions. Elective officers, such as
the president and vice-president, can be expected to be involved in the §493. Organization. The liga at the municipality, city, provincial, metropolitan
general administration or management of the chapter. Hence, the creation of political subdivision, and national levels directly elect a president, a vice-
other elective positions which may be deemed necessary for the management president, and five (5) members of the board of directors. The board shall
of the chapter is within the purview of §493. appoint its secretary and treasurer and create such other positions as it may
deem necessary for the management of the chapter. A secretary-general shall
WHEREFORE, the petition for prohibition is DISMISSED for lack of merit. be elected from among the members of the national liga and shall be charged
with the overall operation of the liga on the national level. The board shall
SO ORDERED.
coordinate the activities of the chapters of the liga. (Emphasis supplied).
Narvasa, C.J., Padilla, Regalado, Bellosillo, Melo, Puno, Kapunan, Francisco
Article VI of the Constitution and By-Laws of the Liga ng Mga Barangay
and Hermosisima, Jr., JJ., concur.
provides as follows:
Torres, Jr., J., is on leave.
ARTICLE VI
OFFICERS AND DIRECTORS
Sec. 1. Organization of Board of Directors of Local Chapters. — The chapter Sections 1 and 2 of Article III of the Revised Implementing Rules and
shall directly elect their respective officers, namely a president; executive Guidelines for the General Elections of Liga ng Mga Barangay Officers read as
vice president; first, second, and third vice-presidents; auditor; and five (5) follows:
members to constitute the Board of Directors of their respective
chapter. Thereafter, the Board shall appoint a secretary, treasurer, and public §1. Local Liga Chapters. The Municipal City Metropolitan and Provincial
relations officers from among the five (5) members, with rest serving as Chapters shall directly elect the following officers and directors to constitute
Directors of Board. The Board may create such other positions as it may their respective Board of Directors, namely:
deem necessary for the management of the chapter. Pending elections of the
1.1 President
president of the municipality, city, provincial and metropolitan chapters of the
Liga, the incumbent presidents of the ABCs of the municipality, city, province 1.2 Executive Vice-President
and Metropolitan Manila shall continue to act as presidents of the
corresponding Liga chapters, subject to the provisions of the Local 1.3 First Vice-President
Government Code of 1991.
1.4 Second Vice-President
Sec. 2. Organization of Board of Directors of the National Liga. — The
1.5 Third Vice-President
National Liga shall be composed of the presidents of the provincial Liga
chapters, highly urbanized and independent component city chapters, and the 1.6 Auditor
metropolitan chapter who shall directly elect their respective officers,
namely, a president, executive vice president; first, second, and third vice 1.7 Five (5) Directors
presidents, auditor, secretary general;and five (5) members to constitute the
Board of Directors of the National Liga. Thereafter, the Board shall appoint a §2. National Liga. The National Liga shall directly elect the following officers
treasurer, secretary and public relations officers from among the five (5) and directors to constitute the National Liga Board of Directors namely:
members with the rest serving as directors of the Board. The Board may
2.1 President
create such other positions as it may deem necessary for the management of
the National Liga. Pending election of Secretary-General, the incumbent 2.2 Executive Vice-President
president of the Pambansang Katipunan ng mga Barangay (PKB) shall act as
the Secretary-General who continue to be presidents of the respective 2.3 First Vice-President
chapters of the Liga to which they belong, shall constitute a committee to
2.4 Second Vice-President
exercise the powers and duties of the National Liga and with the primordial
responsibility of drafting a Constitution and By-Laws needed for the 2.5 Third Vice-President
organization of the Liga as a whole pursuant to the provisions of the Local
Government Code of 1991. (Emphasis supplied). 2.6 Secretary General

2.7 Auditor
2.8 Five (5) Directors members of the Board of Directors. In turn, it is the Board of Directors which
appoints the secretary and treasurer and is empowered to "create such other
To implement Section 493 of the Local Government Code, Article 211(f) of the positions as it may deem necessary for the management of the chapter
Rules and Regulations Implementing the Local Government Code of 1991 concerned." It is, therefore, unequivocally clear that only the Board of
provides: Directors — and not any other body — which is vested with the power to
create other positions as may be necessary for the management of the
(f) Organizational Structure —
chapter.
(1) The national liga and its local chapters shall directly elect their respective
The ponencia maintains that since the questioned positions were provided for
officers, namely: a president, vice president, and five (5) members of the
in the Constitution and By-Laws of the Liga ng Mga Barangay adopted during
board of directors. The board shall appoint its secretary and treasurer and
its First Barangay National Assembly on 11 January 1994, then such
create such other positions as it may deem necessary for the management of
additional positions "were as much the creations of the local chapters as of
the chapter. Pending election of presidents of the municipal, city, provincial,
the national league. The barangay themselves, through the constitution and
and metropolitan chapters of the liga, the incumbent presidents of the
by-laws of their liga, created the additional positions without precluding the
association of barangay councils in the municipality, city, province, and
boards of directors of the chapters as well as that of the national liga from
Metropolitan Manila shall continue to act as presidents of the corresponding
creating other positions."
chapters under this Rule. (Emphasis supplied).
I beg to differ. In the first place, I am unable to find any provision of the LGC
(2) A secretary-general shall be elected from among the members of the
creating or establishing the Barangay National Assembly. What the LGC has
national liga who shall be responsible for the overall operation of the liga.
created is the Liga ng Mga Barangay (Sec. 491) with local chapters at the
Pending election of a secretary-general under this rule, the incumbent
municipal, city, provincial and metropolitan subdivision levels (Sec. 492).
president of the pambansang katipunan ng mga barangay shall act as the
Under the Implementing Rules of the LGC (Art. 211[e][4]), the National Liga
secretary-general. This incumbent members of the board of the pambansang
Ng Mga Barangay is composed of the duly elected presidents of highly
katipunan ng mga barangay, headed by the secretary-general, who continue
urbanized city chapters, provincial chapters and metropolitan chapters.
to be presidents of the respective chapters of the liga to which they belong,
shall constitute a committee to exercise the powers and duties of the national Pursuant to Article 211[f][2] of the Implementing Rules, the members of the
liga and draft or amend the constitution and by-laws of the national liga to Board of the Pambansang Katipunan ng Mga Barangay, headed by the
conform to the provisions of this Rule. Secretary-General, were constituted into a committee to exercise the powers
and duties of the national liga and draft or amend the Constitution and By-
(3) The board of directors shall coordinate the activities of the various
Laws of the Liga. There is at all no showing that this committee was the so-
chapters of the liga.
called First Barangay National Assembly which convened on 11 January 1994.
It may readily be observed that Section 493 of the LGC and Article 211(f) of
Second, even assuming that the committee was the so-called First Barangay
the Implementing Rules are clear that the officers of the national liga and its
National Assembly of 11 January 1994, said committee was not authorized to
local chapters are: (1) the President, (2) Vice President and (3) five (5)
create, by virtue of the Constitution and By-Laws it enacted additional which vests the power to create additional positions only in the Board of
positions for the national liga and the liga at the local levels. The Director of the chapter.
aforementioned Article 211(g), limits the power of this committee, as follows:
The claim in the ponencia that the creation of additional positions in the
(g) Constitution and By-Laws of the Liga — Constitution and By-Laws does not preclude the board of directors of the
chapter as well as that of the national liga from creating other positions, is
(1) All other matters not provided under this Rule affecting the internal inconsistent with the earlier proposition that such new positions, "were as
organization of the liga shall be governed by its constitution and by-laws, much the creations of the local chapters and the league" and the further
unless inconsistent with the Constitution and applicable laws, rules and justification proferred that the creation of the national positions "was intended
regulations. to provide uniform officers for the various chapters and the national liga was
in line with the mandate of the assembly to "formulate uniform constitution
(2) The committee created in this Article shall formulate uniform constitution
and by-laws applicable to the national liga and all local chapters." If this were
and by-laws applicable to the national liga and all local chapters. The
so, then the chapters are barred from creating additional positions other than
committee shall convene the national liga to ratify the constitution and by-
those created in the Constitution and By-Laws of the Liga ng Mga Barangay.
laws within six (6) months from issuance of these Rules.
Finally, it may likewise be observed that Section 493 merely allows the
Note that the constitution and by-laws which the committee may enact must
creation of other appointive positions "as it may deem necessary for the
not be inconsistent with . . . "applicable laws, rules and regulations." Of
management of the chapter." I lay stress on the term "appointive," in light of
course, one of the laws that come to mind is the LGC of 1991 and the rules
the clause preceding the grant of the power, which reads: "The board shall
and regulations could nothing be than the Rules Implementing the Local
appoint its secretary and treasurer. Following the rule of ejusdem generis in
Government Code of 1991. It goes without saying that the LGC and its
statutory construction, the "other positions" which may be created must be of
Implementing Rules must perforce be heeded. It bears repeating that as they
the same category, viz., APPOINTIVE, as that of secretary and treasurer.
stand, Section 493 of the LGC and Article 211 (f) of the Implementing Rules
These other positions may then be that of an assistant secretary, assistant
limit the officers to the: President, Vice President and the board of directors
treasurer, auditor, public relations officer, or information officer, or even a
composed of five (5) members. The latter then appoints a secretary and
sergeant-at-arms. Further, under Section 493, the new positions which may
a treasurer and may create such other positions as it may deem necessary for
be created are those "deemed necessary for the management of the chapter,"
the management of the chapter. Plainly, neither the LGC nor the
which may only pertain to the day-to-day business and affairs of the liga
Implementing Rules authorizes any person or entity, other than the Board of
chapter, and not to policy formulation which may be exercised the executive
Directors, to create additional positions.
officers and Board of Directors. In short, the section does not empower the
Third, it would be a clear case of judicial legislation to declare that since the local liga to create elective positions other than that of President, Vice-
additional positions were created in the Constitution and By-Laws of the Liga President and Board of Directors.
ng Mga Barangay, then they "were as much as the creations of the local
For the foregoing reasons, I vote to declare void, for lack of legislative
chapters as of the national league." This runs afoul of Section 493 of the LGC
authority Sections 1 and 2 of Article III of the Implementing Rules and
Guidelines for the General Elections of the Liga ng Mga Barangay Officers, and Article VI of the Constitution and By-Laws of the Liga ng Mga Barangay
Sections 1 and 2 of Article VI of the Constitution and By-Laws of the Liga ng provides as follows:
Mga Barangay, insofar as they relate to the creation of the positions
of executive vice president, first, second and third vice-presidents, and ARTICLE VI
auditor. OFFICERS AND DIRECTORS

Romero, Vitug and Panganiban, JJ., concur. Sec. 1. Organization of Board of Directors of Local Chapters. — The chapter
shall directly elect their respective officers, namely a president; executive
vice president; first, second, and third vice-presidents; auditor; and five (5)
members to constitute the Board of Directors of their respective
Separate Opinions chapter. Thereafter, the Board shall appoint a secretary, treasurer, and public
relations officers from among the five (5) members, with rest serving as
DAVIDE, JR., J., dissenting;
Directors of Board. The Board may create such other positions as it may
In light of the disclosure in the revised ponencia that the creation of the deem necessary for the management of the chapter. Pending elections of the
questioned additional positions of Executive Vice-President, First, Second and president of the municipality, city, provincial and metropolitan chapters of the
Third Vice-Presidents, and Auditor, embodied in Article III of the Revised Liga, the incumbent presidents of the ABCs of the municipality, city, province
Implementing Rules and Guidelines for the General Elections of Liga ng Mga and Metropolitan Manila shall continue to act as presidents of the
Barangay Officers was made by way of the Constitution and By Laws adopted corresponding Liga chapters, subject to the provisions of the Local
by the First Barangay National Assembly on 11 January 1994, the ultimate Government Code of 1991.
issue then to be resolved is whether or not the Barangay Assembly is
Sec. 2. Organization of Board of Directors of the National Liga. — The
empowered to create said additional positions.
National Liga shall be composed of the presidents of the provincial Liga
Section 493 of the Local Government Code of 1991 (LGC) specifically provides chapters, highly urbanized and independent component city chapters, and the
as follows: metropolitan chapter who shall directly elect their respective officers,
namely, a president, executive vice president; first, second, and third vice
§493. Organization. The liga at the municipality, city, provincial, metropolitan presidents, auditor, secretary general;and five (5) members to constitute the
political subdivision, and national levels directly elect a president, a vice- Board of Directors of the National Liga. Thereafter, the Board shall appoint a
president, and five (5) members of the board of directors. The board shall treasurer, secretary and public relations officers from among the five (5)
appoint its secretary and treasurer and create such other positions as it may members with the rest serving as directors of the Board. The Board may
deem necessary for the management of the chapter. A secretary-general shall create such other positions as it may deem necessary for the management of
be elected from among the members of the national liga and shall be charged the National Liga. Pending election of Secretary-General, the incumbent
with the overall operation of the liga on the national level. The board shall president of the Pambansang Katipunan ng mga Barangay (PKB) shall act as
coordinate the activities of the chapters of the liga. (Emphasis supplied). the Secretary-General who continue to be presidents of the respective
chapters of the Liga to which they belong, shall constitute a committee to
exercise the powers and duties of the National Liga and with the primordial 2.5 Third Vice-President
responsibility of drafting a Constitution and By-Laws needed for the
organization of the Liga as a whole pursuant to the provisions of the Local 2.6 Secretary General
Government Code of 1991. (Emphasis supplied).
2.7 Auditor
Sections 1 and 2 of Article III of the Revised Implementing Rules and
2.8 Five (5) Directors
Guidelines for the General Elections of Liga ng Mga Barangay Officers read as
follows: To implement Section 493 of the Local Government Code, Article 211(f) of the
Rules and Regulations Implementing the Local Government Code of 1991
§1. Local Liga Chapters. The Municipal City Metropolitan and Provincial
provides:
Chapters shall directly elect the following officers and directors to constitute
their respective Board of Directors, namely: (f) Organizational Structure —

1.1 President (1) The national liga and its local chapters shall directly elect their respective
officers, namely: a president, vice president, and five (5) members of the
1.2 Executive Vice-President
board of directors. The board shall appoint its secretary and treasurer and
1.3 First Vice-President create such other positions as it may deem necessary for the management of
the chapter. Pending election of presidents of the municipal, city, provincial,
1.4 Second Vice-President and metropolitan chapters of the liga, the incumbent presidents of the
association of barangay councils in the municipality, city, province, and
1.5 Third Vice-President Metropolitan Manila shall continue to act as presidents of the corresponding
chapters under this Rule. (Emphasis supplied).
1.6 Auditor
(2) A secretary-general shall be elected from among the members of the
1.7 Five (5) Directors
national liga who shall be responsible for the overall operation of the liga.
§2. National Liga. The National Liga shall directly elect the following officers Pending election of a secretary-general under this rule, the incumbent
and directors to constitute the National Liga Board of Directors namely: president of the pambansang katipunan ng mga barangay shall act as the
secretary-general. This incumbent members of the board of the pambansang
2.1 President katipunan ng mga barangay, headed by the secretary-general, who continue
to be presidents of the respective chapters of the liga to which they belong,
2.2 Executive Vice-President
shall constitute a committee to exercise the powers and duties of the national
2.3 First Vice-President liga and draft or amend the constitution and by-laws of the national liga to
conform to the provisions of this Rule.
2.4 Second Vice-President
(3) The board of directors shall coordinate the activities of the various and duties of the national liga and draft or amend the Constitution and By-
chapters of the liga. Laws of the Liga. There is at all no showing that this committee was the so-
called First Barangay National Assembly which convened on 11 January 1994.
It may readily be observed that Section 493 of the LGC and Article 211(f) of
the Implementing Rules are clear that the officers of the national liga and its Second, even assuming that the committee was the so-called First Barangay
local chapters are: (1) the President, (2) Vice President and (3) five (5) National Assembly of 11 January 1994, said committee was not authorized to
members of the Board of Directors. In turn, it is the Board of Directors which create, by virtue of the Constitution and By-Laws it enacted additional
appoints the secretary and treasurer and is empowered to "create such other positions for the national liga and the liga at the local levels. The
positions as it may deem necessary for the management of the chapter aforementioned Article 211(g), limits the power of this committee, as follows:
concerned." It is, therefore, unequivocally clear that only the Board of
Directors — and not any other body — which is vested with the power to (g) Constitution and By-Laws of the Liga —
create other positions as may be necessary for the management of the
(1) All other matters not provided under this Rule affecting the internal
chapter.
organization of the liga shall be governed by its constitution and by-laws,
The ponencia maintains that since the questioned positions were provided for unless inconsistent with the Constitution and applicable laws, rules and
in the Constitution and By-Laws of the Liga ng Mga Barangay adopted during regulations.
its First Barangay National Assembly on 11 January 1994, then such
(2) The committee created in this Article shall formulate uniform constitution
additional positions "were as much the creations of the local chapters as of
and by-laws applicable to the national liga and all local chapters. The
the national league. The barangay themselves, through the constitution and
committee shall convene the national liga to ratify the constitution and by-
by-laws of their liga, created the additional positions without precluding the
laws within six (6) months from issuance of these Rules.
boards of directors of the chapters as well as that of the national liga from
creating other positions." Note that the constitution and by-laws which the committee may enact must
not be inconsistent with . . . "applicable laws, rules and regulations." Of
I beg to differ. In the first place, I am unable to find any provision of the LGC
course, one of the laws that come to mind is the LGC of 1991 and the rules
creating or establishing the Barangay National Assembly. What the LGC has
and regulations could nothing be than the Rules Implementing the Local
created is the Liga ng Mga Barangay (Sec. 491) with local chapters at the
Government Code of 1991. It goes without saying that the LGC and its
municipal, city, provincial and metropolitan subdivision levels (Sec. 492).
Implementing Rules must perforce be heeded. It bears repeating that as they
Under the Implementing Rules of the LGC (Art. 211[e][4]), the National Liga
stand, Section 493 of the LGC and Article 211 (f) of the Implementing Rules
Ng Mga Barangay is composed of the duly elected presidents of highly
limit the officers to the: President, Vice President and the board of directors
urbanized city chapters, provincial chapters and metropolitan chapters.
composed of five (5) members. The latter then appoints a secretary and
Pursuant to Article 211[f][2] of the Implementing Rules, the members of the a treasurer and may create such other positions as it may deem necessary for
Board of the Pambansang Katipunan ng Mga Barangay, headed by the the management of the chapter. Plainly, neither the LGC nor the
Secretary-General, were constituted into a committee to exercise the powers Implementing Rules authorizes any person or entity, other than the Board of
Directors, to create additional positions.
Third, it would be a clear case of judicial legislation to declare that since the local liga to create elective positions other than that of President, Vice-
additional positions were created in the Constitution and By-Laws of the Liga President and Board of Directors.
ng Mga Barangay, then they "were as much as the creations of the local
chapters as of the national league." This runs afoul of Section 493 of the LGC For the foregoing reasons, I vote to declare void, for lack of legislative
which vests the power to create additional positions only in the Board of authority Sections 1 and 2 of Article III of the Implementing Rules and
Director of the chapter. Guidelines for the General Elections of the Liga ng Mga Barangay Officers, and
Sections 1 and 2 of Article VI of the Constitution and By-Laws of the Liga ng
The claim in the ponencia that the creation of additional positions in the Mga Barangay, insofar as they relate to the creation of the positions
Constitution and By-Laws does not preclude the board of directors of the of executive vice president, first, second and third vice-presidents, and
chapter as well as that of the national liga from creating other positions, is auditor.
inconsistent with the earlier proposition that such new positions, "were as
much the creations of the local chapters and the league" and the further Romero, Vitug and Panganiban, JJ., concur.
justification proferred that the creation of the national positions "was intended
to provide uniform officers for the various chapters and the national liga was
in line with the mandate of the assembly to "formulate uniform constitution
and by-laws applicable to the national liga and all local chapters." If this were
so, then the chapters are barred from creating additional positions other than
those created in the Constitution and By-Laws of the Liga ng Mga Barangay.

Finally, it may likewise be observed that Section 493 merely allows the
creation of other appointive positions "as it may deem necessary for the
management of the chapter." I lay stress on the term "appointive," in light of
the clause preceding the grant of the power, which reads: "The board shall
appoint its secretary and treasurer. Following the rule of ejusdem generis in
statutory construction, the "other positions" which may be created must be of
the same category, viz., APPOINTIVE, as that of secretary and treasurer.
These other positions may then be that of an assistant secretary, assistant
treasurer, auditor, public relations officer, or information officer, or even a
sergeant-at-arms. Further, under Section 493, the new positions which may
be created are those "deemed necessary for the management of the chapter,"
which may only pertain to the day-to-day business and affairs of the liga
chapter, and not to policy formulation which may be exercised the executive
officers and Board of Directors. In short, the section does not empower the
EN BANC CARPIO MORALES,

- versus - VELASCO, JR.,

NACHURA,

LEONARDO-DE CASTRO,

LOUIS BAROK C. BIRAOGO, G.R. No. 192935 BRION,

Petitioner, PERALTA,

BERSAMIN,

- versus - DEL CASTILLO,

ABAD,

THE PHILIPPINE TRUTH COMMISSION VILLARAMA, JR.,


OF 2010,
EXECUTIVE SECRETARY PAQUITO N. PEREZ,
Respondent. OCHOA, JR. and DEPARTMENT OF
BUDGET AND MANAGEMENT MENDOZA, and
x-----------------------x SECRETARY FLORENCIO B. ABAD,
SERENO, JJ.
REP. EDCEL C. LAGMAN, Respondents.
G.R. No. 193036
REP. RODOLFO B. ALBANO, JR., REP.
SIMEON A. DATUMANONG, and REP. Promulgated:
ORLANDO B. FUA, SR.,
Present:
Petitioners,
December 7, 2010

CORONA, C.J.,

CARPIO,
x remain steadfast no matter what may be the tides of time. It cannot be
-------------------------------------------------------------------------------------- simply made to sway and accommodate the call of situations and much more
x tailor itself to the whims and caprices of government and the people who run
it.[4]

For consideration before the Court are two consolidated cases[5] both of which
essentially assail the validity and constitutionality of Executive Order No. 1,
dated July 30, 2010, entitled Creating the Philippine Truth Commission of
DECISION
2010.

MENDOZA, J.:

The first case is G.R. No. 192935, a special civil action for prohibition
When the judiciary mediates to allocate constitutional boundaries, it does not instituted by petitioner Louis Biraogo (Biraogo) in his capacity as a citizen and
assert any superiority over the other departments; it does not in reality taxpayer. Biraogo assails Executive Order No. 1 for being violative of the
nullify or invalidate an act of the legislature, but only asserts the solemn and legislative power of Congress under Section 1, Article VI of the
sacred obligation assigned to it by the Constitution to determine conflicting Constitution[6] as it usurps the constitutional authority of the legislature to
claims of authority under the Constitution and to establish for the parties in create a public office and to appropriate funds therefor.[7]
an actual controversy the rights which that instrument secures and
guarantees to them.
The second case, G.R. No. 193036, is a special civil action for certiorari and
prohibition filed by petitioners Edcel C. Lagman, Rodolfo B. Albano Jr., Simeon
--- Justice Jose P. Laurel[1] A. Datumanong, and Orlando B. Fua, Sr. (petitioners-legislators) as
incumbent members of the House of Representatives.
The role of the Constitution cannot be overlooked. It is through the
Constitution that the fundamental powers of government are established,
limited and defined, and by which these powers are distributed among the
The genesis of the foregoing cases can be traced to the events prior to the
several departments.[2] The Constitution is the basic and paramount law to
historic May 2010 elections, when then Senator Benigno Simeon Aquino III
which all other laws must conform and to which all persons, including the
declared his staunch condemnation of graft and corruption with his
highest officials of the land, must defer.[3] Constitutional doctrines must
slogan, Kung walang corrupt, walang mahirap. The Filipino people, convinced
of his sincerity and of his ability to carry out this noble objective, catapulted WHEREAS, corruption is an evil and scourge which seriously affects the
the good senator to the presidency. political, economic, and social life of a nation; in a very special way it inflicts
untold misfortune and misery on the poor, the marginalized and
underprivileged sector of society;

To transform his campaign slogan into reality, President Aquino found a need
for a special body to investigate reported cases of graft and corruption
allegedly committed during the previous administration. WHEREAS, corruption in the Philippines has reached very alarming levels, and
undermined the peoples trust and confidence in the Government and its
institutions;

Thus, at the dawn of his administration, the President on July 30, 2010,
signed Executive Order No. 1 establishing the Philippine Truth Commission of
2010 (Truth Commission). Pertinent provisions of said executive order read: WHEREAS, there is an urgent call for the determination of the truth regarding
certain reports of large scale graft and corruption in the government and to
EXECUTIVE ORDER NO. 1 put a closure to them by the filing of the appropriate cases against those
involved, if warranted, and to deter others from committing the evil, restore
the peoples faith and confidence in the Government and in their public
CREATING THE PHILIPPINE TRUTH COMMISSION OF 2010 servants;

WHEREAS, Article XI, Section 1 of the 1987 Constitution of the Philippines WHEREAS, the Presidents battlecry during his campaign for the Presidency in
solemnly enshrines the principle that a public office is a public trust and the last elections kung walang corrupt, walang mahirap expresses a solemn
mandates that public officers and employees, who are servants of the people, pledge that if elected, he would end corruption and the evil it breeds;
must at all times be accountable to the latter, serve them with utmost
responsibility, integrity, loyalty and efficiency, act with patriotism and justice,
and lead modest lives; WHEREAS, there is a need for a separate body dedicated solely to
investigating and finding out the truth concerning the reported cases of graft
and corruption during the previous administration, and which will recommend
WHEREAS, corruption is among the most despicable acts of defiance of this the prosecution of the offenders and secure justice for all;
principle and notorious violation of this mandate;
WHEREAS, Book III, Chapter 10, Section 31 of Executive Order No. 292,
otherwise known as the Revised Administrative Code of the Philippines, gives
the President the continuing authority to reorganize the Office of the In particular, it shall:
President.

a) Identify and determine the reported cases of such graft and corruption
NOW, THEREFORE, I, BENIGNO SIMEON AQUINO III, President of the which it will investigate;
Republic of the Philippines, by virtue of the powers vested in me by law, do
hereby order:

b) Collect, receive, review and evaluate evidence related to or regarding


the cases of large scale corruption which it has chosen to investigate, and to
SECTION 1. Creation of a Commission. There is hereby created this end require any agency, official or employee of the Executive Branch,
the PHILIPPINE TRUTH COMMISSION, hereinafter referred to as including government-owned or controlled corporations, to produce
the COMMISSION, which shall primarily seek and find the truth on, and documents, books, records and other papers;
toward this end, investigate reports of graft and corruption of such scale and
magnitude that shock and offend the moral and ethical sensibilities of the
people, committed by public officers and employees, their co-principals,
c) Upon proper request or representation, obtain information and
accomplices and accessories from the private sector, if any, during the
documents from the Senate and the House of Representatives records of
previous administration; and thereafter recommend the appropriate action or
investigations conducted by committees thereof relating to matters or
measure to be taken thereon to ensure that the full measure of justice shall
subjects being investigated by the Commission;
be served without fear or favor.

The Commission shall be composed of a Chairman and four (4) members who
will act as an independent collegial body. d) Upon proper request and representation, obtain information from the
courts, including the Sandiganbayan and the Office of the Court
Administrator, information or documents in respect to corruption cases filed
SECTION 2. Powers and Functions. The Commission, which shall have all the with the Sandiganbayan or the regular courts, as the case may be;
powers of an investigative body under Section 37, Chapter 9, Book I of the
Administrative Code of 1987, is primarily tasked to conduct a thorough fact-
finding investigation of reported cases of graft and corruption referred to in e) Invite or subpoena witnesses and take their testimonies and for that
Section 1, involving third level public officers and higher, their co-principals, purpose, administer oaths or affirmations as the case may be;
accomplices and accessories from the private sector, if any, during the
previous administration and thereafter submit its finding and
recommendations to the President, Congress and the Ombudsman.
f) Recommend, in cases where there is a need to utilize any person as a k) Exercise such other acts incident to or are appropriate and necessary in
state witness to ensure that the ends of justice be fully served, that such connection with the objectives and purposes of this Order.
person who qualifies as a state witness under the Revised Rules of Court of
the Philippines be admitted for that purpose; SECTION 3. Staffing Requirements. x x x.

g) Turn over from time to time, for expeditious prosecution, to the SECTION 4. Detail of Employees. x x x.
appropriate prosecutorial authorities, by means of a special or interim report
SECTION 5. Engagement of Experts. x x x
and recommendation, all evidence on corruption of public officers and
employees and their private sector co-principals, accomplices or accessories,
if any, when in the course of its investigation the Commission finds that there
is reasonable ground to believe that they are liable for graft and corruption SECTION 6. Conduct of Proceedings. x x x.
under pertinent applicable laws;
SECTION 7. Right to Counsel of Witnesses/Resource Persons. x x x.

SECTION 8. Protection of Witnesses/Resource Persons. x x x.


h) Call upon any government investigative or prosecutorial agency such as
SECTION 9. Refusal to Obey Subpoena, Take Oath or Give Testimony. Any
the Department of Justice or any of the agencies under it, and the Presidential
government official or personnel who, without lawful excuse, fails to appear
Anti-Graft Commission, for such assistance and cooperation as it may require
upon subpoena issued by the Commission or who, appearing before the
in the discharge of its functions and duties;
Commission refuses to take oath or affirmation, give testimony or produce
documents for inspection, when required, shall be subject to administrative
disciplinary action. Any private person who does the same may be dealt with
i) Engage or contract the services of resource persons, professionals and in accordance with law.
other personnel determined by it as necessary to carry out its mandate;
SECTION 10. Duty to Extend Assistance to the Commission. x x x.

SECTION 11. Budget for the Commission. The Office of the President shall
j) Promulgate its rules and regulations or rules of procedure it deems provide the necessary funds for the Commission to ensure that it can exercise
necessary to effectively and efficiently carry out the objectives of this its powers, execute its functions, and perform its duties and responsibilities as
Executive Order and to ensure the orderly conduct of its investigations, effectively, efficiently, and expeditiously as possible.
proceedings and hearings, including the presentation of evidence;
SECTION 12. Office. x x x.
SECTION 13. Furniture/Equipment. x x x.

DONE in the City of Manila, Philippines, this 30th day of July 2010.

SECTION 14. Term of the Commission. The Commission shall accomplish its
mission on or before December 31, 2012.
(SGD.) BENIGNO S. AQUINO III

SECTION 15. Publication of Final Report. x x x.


By the President:

SECTION 16. Transfer of Records and Facilities of the Commission. x x x.


(SGD.) PAQUITO N. OCHOA, JR.

Executive Secretary
SECTION 17. Special Provision Concerning Mandate. If and when in the
judgment of the President there is a need to expand the mandate of the
Commission as defined in Section 1 hereof to include the investigation of
Nature of the Truth Commission
cases and instances of graft and corruption during the prior administrations,
such mandate may be so extended accordingly by way of a supplemental
Executive Order.
As can be gleaned from the above-quoted provisions, the Philippine Truth
Commission (PTC) is a mere ad hoc body formed under the Office of the
President with the primary task to investigate reports of graft and corruption
committed by third-level public officers and employees, their co-principals,
accomplices and accessories during the previous administration, and
thereafter to submit its finding and recommendations to the President,
SECTION 18. Separability Clause. If any provision of this Order is declared Congress and the Ombudsman. Though it has been described as an
unconstitutional, the same shall not affect the validity and effectivity of the independent collegial body, it is essentially an entity within the Office of the
other provisions hereof. President Proper and subject to his control. Doubtless, it constitutes a public
office, as an ad hoc body is one.[8]

SECTION 19. Effectivity. This Executive Order shall take effect immediately.
To accomplish its task, the PTC shall have all the powers of an investigative
body under Section 37, Chapter 9, Book I of the Administrative Code of
1987. It is not, however, a quasi-judicial body as it cannot Thus, their main goals range from retribution to reconciliation. The
adjudicate, arbitrate, resolve, settle, or render awards in disputes between Nuremburg and Tokyo war crime tribunals are examples of a retributory or
contending parties. All it can do is gather, collect and assess evidence of graft vindicatory body set up to try and punish those responsible for crimes against
and corruption and make recommendations. It may have subpoena powers humanity. A form of a reconciliatory tribunal is the Truth and Reconciliation
but it has no power to cite people in contempt, much less order their Commission of South Africa, the principal function of which was to heal the
arrest. Although it is a fact-finding body, it cannot determine from such facts wounds of past violence and to prevent future conflict by providing a cathartic
if probable cause exists as to warrant the filing of an information in our courts experience for victims.
of law. Needless to state, it cannot impose criminal, civil or administrative
penalties or sanctions.
The PTC is a far cry from South Africas model. The latter placed more
The PTC is different from the truth commissions in other countries which have
emphasis on reconciliation than on judicial retribution, while the marching
been created as official, transitory and non-judicial fact-finding bodies to
order of the PTC is the identification and punishment of perpetrators. As one
establish the facts and context of serious violations of human rights or of
writer[12] puts it:
international humanitarian law in a countrys past.[9] They are usually
established by states emerging from periods of internal unrest, civil strife or
authoritarianism to serve as mechanisms for transitional justice.
The order ruled out reconciliation. It translated the Draconian code spelled
out by Aquino in his inaugural speech: To those who talk about reconciliation,
if they mean that they would like us to simply forget about the wrongs that
Truth commissions have been described as bodies that share the following
they have committed in the past, we have this to say: There can be no
characteristics: (1) they examine only past events; (2) they investigate
reconciliation without justice. When we allow crimes to go unpunished, we
patterns of abuse committed over a period of time, as opposed to a particular
give consent to their occurring over and over again.
event; (3) they are temporary bodies that finish their work with the
submission of a report containing conclusions and recommendations; and (4)
they are officially sanctioned, authorized or empowered by the State.
[10]
Commissions members are usually empowered to conduct research, The Thrusts of the Petitions
support victims, and propose policy recommendations to prevent recurrence
of crimes. Through their investigations, the commissions may aim to discover
and learn more about past abuses, or formally acknowledge them. They may Barely a month after the issuance of Executive Order No. 1, the petitioners
aim to prepare the way for prosecutions and recommend institutional asked the Court to declare it unconstitutional and to enjoin the PTC from
reforms.[11] performing its functions. A perusal of the arguments of the petitioners in both
cases shows that they are essentially the same. The petitioners-legislators constitute truth commissions to exclusively investigate human rights
summarized them in the following manner: violations, which customary practice forms part of the generally accepted
principles of international law which the Philippines is mandated to adhere to
pursuant to the Declaration of Principles enshrined in the Constitution.

(a) E.O. No. 1 violates the separation of powers as it arrogates the power of
the Congress to create a public office and appropriate funds for its operation.
(f) The creation of the Truth Commission is an exercise in futility, an
adventure in partisan hostility, a launching pad for trial/conviction by publicity
and a mere populist propaganda to mistakenly impress the people that
(b) The provision of Book III, Chapter 10, Section 31 of the Administrative
widespread poverty will altogether vanish if corruption is eliminated without
Code of 1987 cannot legitimize E.O. No. 1 because the delegated authority of
even addressing the other major causes of poverty.
the President to structurally reorganize the Office of the President to achieve
economy, simplicity and efficiency does not include the power to create an
entirely new public office which was hitherto inexistent like the Truth
Commission. (g) The mere fact that previous commissions were not constitutionally
challenged is of no moment because neither laches nor estoppel can bar an
eventual question on the constitutionality and validity of an executive
issuance or even a statute.[13]
(c) E.O. No. 1 illegally amended the Constitution and pertinent statutes when
it vested the Truth Commission with quasi-judicial powers duplicating, if not
superseding, those of the Office of the Ombudsman created under the 1987
Constitution and the Department of Justice created under the Administrative
Code of 1987.
In their Consolidated Comment,[14] the respondents, through the Office of the
Solicitor General (OSG), essentially questioned the legal standing of
petitioners and defended the assailed executive order with the following
(d) E.O. No. 1 violates the equal protection clause as it selectively targets for arguments:
investigation and prosecution officials and personnel of the previous
administration as if corruption is their peculiar species even as it excludes
those of the other administrations, past and present, who may be indictable.
1] E.O. No. 1 does not arrogate the powers of Congress to create a public
office because the Presidents executive power and power of control
necessarily include the inherent power to conduct investigations to ensure
(e) The creation of the Philippine Truth Commission of 2010 violates the that laws are faithfully executed and that, in any event, the Constitution,
consistent and general international practice of four decades wherein States Revised Administrative Code of 1987 (E.O. No. 292), [15] Presidential Decree
(P.D.) No. 1416[16] (as amended by P.D. No. 1772), R.A. No. 9970,[17] and
settled jurisprudence that authorize the President to create or form such
bodies. 1. Whether or not the petitioners have the legal standing to
file their respective petitions and question Executive Order No. 1;

2] E.O. No. 1 does not usurp the power of Congress to appropriate funds
because there is no appropriation but a mere allocation of funds already 2. Whether or not Executive Order No. 1 violates the
appropriated by Congress. principle of separation of powers by usurping the powers of Congress to
create and to appropriate funds for public offices, agencies and commissions;

3. Whether or not Executive Order No. 1 supplants the powers of the


3] The Truth Commission does not duplicate or supersede the functions of the Ombudsman and the DOJ;
Office of the Ombudsman (Ombudsman) and the Department of
Justice (DOJ),because it is a fact-finding body and not a quasi-judicial body
and its functions do not duplicate, supplant or erode the latters jurisdiction.
4. Whether or not Executive Order No. 1 violates the equal protection clause;
and

4] The Truth Commission does not violate the equal protection clause because
it was validly created for laudable purposes.
5. Whether or not petitioners are entitled to injunctive relief.

Essential requisites for judicial review


The OSG then points to the continued existence and validity of other
executive orders and presidential issuances creating similar bodies to justify
the creation of the PTC such as Presidential Complaint and Action Before proceeding to resolve the issue of the constitutionality of Executive
Commission (PCAC) by President Ramon B. Magsaysay, Presidential Order No. 1, the Court needs to ascertain whether the requisites for a valid
Committee on Administrative Performance Efficiency (PCAPE)by President exercise of its power of judicial review are present.
Carlos P. Garcia and Presidential Agency on Reform and Government
Operations (PARGO) by President Ferdinand E. Marcos.[18]

From the petitions, pleadings, transcripts, and memoranda, the following are Like almost all powers conferred by the Constitution, the power of judicial
the principal issues to be resolved: review is subject to limitations, to wit: (1) there must be an actual case or
controversy calling for the exercise of judicial power; (2) the person usurpation of their power and rights as members of the legislature before the
challenging the act must have the standing to question the validity of the Court. As held in Philippine Constitution Association v. Enriquez,[21]
subject act or issuance; otherwise stated, he 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; (3) the question of
To the extent the powers of Congress are impaired, so is the power of each
constitutionality must be raised at the earliest opportunity; and (4) the issue
member thereof, since his office confers a right to participate in the exercise
of constitutionality must be the very lis mota of the case.[19]
of the powers of that institution.

An act of the Executive which injures the institution of Congress causes a


Among all these limitations, only the legal standing of the petitioners has derivative but nonetheless substantial injury, which can be questioned by a
been put at issue. member of Congress. In such a case, any member of Congress can have a
resort to the courts.

Legal Standing of the Petitioners


Indeed, legislators have a legal standing to see to it that the prerogative,
powers and privileges vested by the Constitution in their office remain
inviolate. Thus, they are allowed to question the validity of any official action
The OSG attacks the legal personality of the petitioners-legislators to file their which, to their mind, infringes on their prerogatives as legislators.[22]
petition for failure to demonstrate their personal stake in the outcome of the
case. It argues that the petitioners have not shown that they have sustained
or are in danger of sustaining any personal injury attributable to the creation
of the PTC. Not claiming to be the subject of the commissions investigations, With regard to Biraogo, the OSG argues that, as a taxpayer, he has no
petitioners will not sustain injury in its creation or as a result of its standing to question the creation of the PTC and the budget for its operations.
[23]
proceedings.[20] It emphasizes that the funds to be used for the creation and operation of
the commission are to be taken from those funds already appropriated by
Congress. Thus, the allocation and disbursement of funds for the commission
will not entail congressional action but will simply be an exercise of the
The Court disagrees with the OSG in questioning the legal standing of the Presidents power over contingent funds.
petitioners-legislators to assail Executive Order No. 1. Evidently, their petition
primarily invokes usurpation of the power of the Congress as a body to which
they belong as members. This certainly justifies their resolve to take the
cudgels for Congress as an institution and present the complaints on the As correctly pointed out by the OSG, Biraogo has not shown that he
sustained, or is in danger of sustaining, any personal and direct injury
attributable to the implementation of Executive Order No. 1. Nowhere in his
petition is an assertion of a clear right that may justify his clamor for the Court in People ex rel Case v. Collins: In matter of mere public right,
Court to exercise judicial power and to wield the axe over presidential howeverthe people are the real partiesIt is at least the right, if not the duty,
issuances in defense of the Constitution. The case of David v. of every citizen to interfere and see that a public offence be properly pursued
Arroyo[24] explained the deep-seated rules on locus standi. Thus: and punished, and that a public grievance be remedied. With respect to
taxpayers suits, Terr v. Jordan held that the right of a citizen and a taxpayer
to maintain an action in courts to restrain the unlawful use of public funds to
his injury cannot be denied.
Locus standi is defined as a right of appearance in a court of justice on a
given question. In private suits, standing is governed by the real-parties-in
interest rule as contained in Section 2, Rule 3 of the 1997 Rules of Civil
Procedure, as amended. It provides that every action must be prosecuted However, to prevent just about any person from seeking judicial interference
or defended in the name of the real party in interest. Accordingly, the in any official policy or act with which he disagreed with, and thus hinders the
real-party-in interest is the party who stands to be benefited or injured by the activities of governmental agencies engaged in public service, the United
judgment in the suit or the party entitled to the avails of the suit.Succinctly State Supreme Court laid down the more stringent direct injury test in Ex
put, the plaintiffs standing is based on his own right to the relief sought. Parte Levitt, later reaffirmed in Tileston v. Ullman. The same Court ruled that
for a private individual to invoke the judicial power to determine the validity
of an executive or legislative action, he must show that he has sustained
a direct injury as a result of that action, and it is not sufficient that he
The difficulty of determining locus standi arises in public suits. Here, the
has a general interest common to all members of the public.
plaintiff who asserts a public right in assailing an allegedly illegal official
action, does so as a representative of the general public. He may be a person
who is affected no differently from any other person. He could be suing as a
stranger, or in the category of a citizen, or taxpayer. In either case, he has to This Court adopted the direct injury test in our jurisdiction. In People v.
adequately show that he is entitled to seek judicial protection. In other words, Vera, it held that the person who impugns the validity of a statute must
he has to make out a sufficient interest in the vindication of the public order have a personal and substantial interest in the case such that he has
and the securing of relief as a citizen or taxpayer. sustained, or will sustain direct injury as a result. The Vera doctrine was
upheld in a litany of cases, such as, Custodio v. President of the
Senate, Manila Race Horse Trainers Association v. De la Fuente, Pascual v.
Secretary of Public Works and Anti-Chinese League of the Philippines v.
Case law in most jurisdictions now allows both citizen and taxpayer standing
Felix. [Emphases included. Citations omitted]
in public actions. The distinction was first laid down in Beauchamp v. Silk,
where it was held that the plaintiff in a taxpayers suit is in a different
category from the plaintiff in a citizens suit. In the former, the plaintiff is
affected by the expenditure of public funds, while in the latter, he is but the
mere instrument of the public concern. As held by the New York Supreme
Notwithstanding, the Court leans on the doctrine that the rule on standing is a
matter of procedure, hence, can be relaxed for nontraditional plaintiffs like
ordinary citizens, taxpayers, and legislators when the public interest so Power of the President to Create the Truth Commission
requires, such as when the matter is of transcendental importance, of
overreaching significance to society, or of paramount public interest.[25]
In his memorandum in G.R. No. 192935, Biraogo asserts that the Truth
Commission is a public office and not merely an adjunct body of the Office of
Thus, in Coconut Oil Refiners Association, Inc. v. Torres,[26] the Court held the President.[31]Thus, in order that the President may create a public office he
that in cases of paramount importance where serious constitutional questions must be empowered by the Constitution, a statute or an authorization vested
are involved, the standing requirements may be relaxed and a suit may be in him by law. According to petitioner, such power cannot be
allowed to prosper even where there is no direct injury to the party claiming presumed[32] since there is no provision in the Constitution or any specific law
the right of judicial review. In the first Emergency Powers Cases,[27] ordinary that authorizes the President to create a truth commission.[33] He adds that
citizens and taxpayers were allowed to question the constitutionality of Section 31 of the Administrative Code of 1987, granting the President the
several executive orders although they had only an indirect and general continuing authority to reorganize his office, cannot serve as basis for the
interest shared in common with the public. creation of a truth commission considering the aforesaid provision merely
uses verbs such as reorganize, transfer, consolidate, merge, and abolish.
[34]
Insofar as it vests in the President the plenary power to reorganize the
Office of the President to the extent of creating a public office, Section 31 is
The OSG claims that the determinants of transcendental importance[28] laid inconsistent with the principle of separation of powers enshrined in the
down in CREBA v. ERC and Meralco[29] are non-existent in this case. The Constitution and must be deemed repealed upon the effectivity thereof. [35]
Court, however, finds reason in Biraogos assertion that the petition covers
matters of transcendental importance to justify the exercise of jurisdiction by
the Court. There are constitutional issues in the petition which deserve the
attention of this Court in view of their seriousness, novelty and weight as Similarly, in G.R. No. 193036, petitioners-legislators argue that the creation
precedents. Where the issues are of transcendental and paramount of a public office lies within the province of Congress and not with the
importance not only to the public but also to the Bench and the Bar, they executive branch of government. They maintain that the delegated authority
should be resolved for the guidance of all.[30] Undoubtedly, the Filipino people of the President to reorganize under Section 31 of the Revised Administrative
are more than interested to know the status of the Presidents first effort to Code: 1) does not permit the President to create a public office, much less a
bring about a promised change to the country. The Court takes cognizance of truth commission; 2) is limited to the reorganization of the administrative
the petition not due to overwhelming political undertones that clothe the issue structure of the Office of the President; 3) is limited to the restructuring of
in the eyes of the public, but because the Court stands firm in its oath to the internal organs of the Office of the President Proper, transfer of functions
perform its constitutional duty to settle legal controversies with overreaching and transfer of agencies; and 4) only to achieve simplicity, economy and
significance to society. efficiency.[36] Such continuing authority of the President to reorganize his
office is limited, and by issuing Executive Order No. 1, the President The OSG also cites the recent case of Banda v. Ermita,[44] where it was held
overstepped the limits of this delegated authority. that the President has the power to reorganize the offices and agencies in the
executive department in line with his constitutionally granted power of control
and by virtue of a valid delegation of the legislative power to reorganize
executive offices under existing statutes.
The OSG counters that there is nothing exclusively legislative about the
creation by the President of a fact-finding body such as a truth commission.
Pointing to numerous offices created by past presidents, it argues that the
authority of the President to create public offices within the Office of the Thus, the OSG concludes that the power of control necessarily includes the
President Proper has long been recognized.[37]According to the OSG, the power to create offices. For the OSG, the President may create the PTC in
Executive, just like the other two branches of government, possesses the order to, among others, put a closure to the reported large scale graft and
inherent authority to create fact-finding committees to assist it in the corruption in the government.[45]
performance of its constitutionally mandated functions and in the exercise of
its administrative functions.[38] This power, as the OSG explains it, is but an
adjunct of the plenary powers wielded by the President under Section 1 and
The question, therefore, before the Court is this: Does the creation of the PTC
his power of control under Section 17, both of Article VII of the Constitution.
[39]
fall within the ambit of the power to reorganize as expressed in Section 31 of
the Revised Administrative Code? Section 31 contemplates reorganization as
limited by the following functional and structural lines: (1) restructuring the
internal organization of the Office of the President Proper by abolishing,
It contends that the President is necessarily vested with the power to conduct consolidating or merging units thereof or transferring functions from one unit
fact-finding investigations, pursuant to his duty to ensure that all laws are to another; (2) transferring any function under the Office of the President to
enforced by public officials and employees of his department and in the any other Department/Agency or vice versa; or (3) transferring any agency
exercise of his authority to assume directly the functions of the executive under the Office of the President to any other Department/Agency or vice
department, bureau and office, or interfere with the discretion of his officials. versa.Clearly, the provision refers to reduction of personnel, consolidation of
[40]
The power of the President to investigate is not limited to the exercise of offices, or abolition thereof by reason of economy or redundancy of
his power of control over his subordinates in the executive branch, but functions. These point to situations where a body or an office is already
extends further in the exercise of his other powers, such as his power to existent but a modification or alteration thereof has to be effected. The
discipline subordinates,[41] his power for rule making, adjudication and creation of an office is nowhere mentioned, much less envisioned in said
licensing purposes[42] and in order to be informed on matters which he is provision. Accordingly, the answer to the question is in the negative.
entitled to know.[43]

To say that the PTC is borne out of a restructuring of the Office of the
President under Section 31 is a misplaced supposition, even in the plainest
meaning attributable to the term restructure an alteration of an existing duties and to substitute the judgment of the former with that of the latter.
[47]
structure. Evidently, the PTC was not part of the structure of the Office of the Clearly, the power of control is entirely different from the power to create
President prior to the enactment of Executive Order No. 1. As held in Buklod public offices. The former is inherent in the Executive, while the latter finds
ng Kawaning EIIB v. Hon. Executive Secretary,[46] basis from either a valid delegation from Congress, or his inherent duty to
faithfully execute the laws.

The question is this, is there a valid delegation of power from Congress,


But of course, the list of legal basis authorizing the President to reorganize empowering the President to create a public office?
any department or agency in the executive branch does not have to end here.
We must not lose sight of the very source of the power that which constitutes
an express grant of power. Under Section 31, Book III of Executive Order No.
292 (otherwise known as the Administrative Code of 1987), "the President, According to the OSG, the power to create a truth commission pursuant to
subject to the policy in the Executive Office and in order to achieve simplicity, the above provision finds statutory basis under P.D. 1416, as amended by
economy and efficiency, shall have the continuing authority to reorganize the P.D. No. 1772.[48] The said law granted the President the continuing authority
administrative structure of the Office of the President." For this purpose, he to reorganize the national government, including the power to group,
may transfer the functions of other Departments or Agencies to the Office of consolidate bureaus and agencies, to abolish offices, to transfer functions, to
the President. In Canonizado v. Aguirre [323 SCRA 312 (2000)], we ruled create and classify functions, services and activities, transfer appropriations,
that reorganization "involves the reduction of personnel, consolidation of and to standardize salaries and materials. This decree, in relation to Section
offices, or abolition thereof by reason of economy or redundancy of 20, Title I, Book III of E.O. 292 has been invoked in several cases such
functions." It takes place when there is an alteration of the existing as Larin v. Executive Secretary.[49]
structure of government offices or units therein, including the lines of
control, authority and responsibility between them. The EIIB is a
bureau attached to the Department of Finance. It falls under the Office of the The Court, however, declines to recognize P.D. No. 1416 as a justification for
President. Hence, it is subject to the Presidents continuing authority to the President to create a public office. Said decree is already stale,
reorganize. [Emphasis Supplied] anachronistic and inoperable. P.D. No. 1416 was a delegation to then
President Marcos of the authority to reorganize the administrative structure of
the national government including the power to create offices and transfer
appropriations pursuant to one of the purposes of the decree, embodied in its
last Whereas clause:
In the same vein, the creation of the PTC is not justified by the Presidents
power of control. Control is essentially the power to alter or modify or nullify
or set aside what a subordinate officer had done in the performance of his
WHEREAS, the transition towards the parliamentary form of government will
necessitate flexibility in the organization of the national government.
ASSOCIATE JUSTICE CARPIO: The power of the President to reorganize the
entire National Government is deemed repealed, at least, upon the adoption
of the 1987 Constitution, correct.

Clearly, as it was only for the purpose of providing manageability and


resiliency during the interim, P.D. No. 1416, as amended by P.D. No. SOLICITOR GENERAL CADIZ: Yes, Your Honor.[50]
1772, became functus oficioupon the convening of the First Congress, as
expressly provided in Section 6, Article XVIII of the 1987 Constitution. In fact,
even the Solicitor General agrees with this view. Thus:

While the power to create a truth commission cannot pass muster on the
basis of P.D. No. 1416 as amended by P.D. No. 1772, the creation of the PTC
finds justification under Section 17, Article VII of the Constitution, imposing
ASSOCIATE JUSTICE CARPIO: Because P.D. 1416 was enacted was the last upon the President the duty to ensure that the laws are faithfully executed.
whereas clause of P.D. 1416 says it was enacted to prepare the transition Section 17 reads:
from presidential to parliamentary. Now, in a parliamentary form of
government, the legislative and executive powers are fused, correct?

Section 17. The President shall have control of all the executive departments,
bureaus, and offices. He shall ensure that the laws be faithfully
SOLICITOR GENERAL CADIZ: Yes, Your Honor. executed. (Emphasis supplied).

ASSOCIATE JUSTICE CARPIO: That is why, that P.D. 1416 was issued. Now As correctly pointed out by the respondents, the allocation of power in the
would you agree with me that P.D. 1416 should not be considered effective three principal branches of government is a grant of all powers inherent in
anymore upon the promulgation, adoption, ratification of the 1987 them. The Presidents power to conduct investigations to aid him in ensuring
Constitution. the faithful execution of laws in this case, fundamental laws on public
accountability and transparency is inherent in the Presidents powers as the
Chief Executive. That the authority of the President to conduct investigations
and to create bodies to execute this power is not explicitly mentioned in the
SOLICITOR GENERAL CADIZ: Not the whole of P.D. [No.] 1416, Your Honor.
Constitution or in statutes does not mean that he is bereft of such authority. It has been advanced that whatever power inherent in the government that is
[51]
As explained in the landmark case of Marcos v. Manglapus:[52] neither legislative nor judicial has to be executive. x x x.

x x x. The 1987 Constitution, however, brought back the presidential system


of government and restored the separation of legislative, executive and
judicial powers by their actual distribution among three distinct branches of Indeed, the Executive is given much leeway in ensuring that our laws are
government with provision for checks and balances. faithfully executed. As stated above, the powers of the President are not
limited to those specific powers under the Constitution.[53] One of the
recognized powers of the President granted pursuant to this constitutionally-
mandated duty is the power to create ad hoc committees. This flows from the
It would not be accurate, however, to state that "executive power" is the obvious need to ascertain facts and determine if laws have been faithfully
power to enforce the laws, for the President is head of state as well as head executed. Thus, in Department of Health v. Camposano,[54] the authority
of government and whatever powers inhere in such positions pertain to the of the President to issue Administrative Order No. 298, creating an
office unless the Constitution itself withholds it. Furthermore, the Constitution investigative committee to look into the administrative charges filed against
itself provides that the execution of the laws is only one of the powers of the the employees of the Department of Health for the anomalous purchase of
President. It also grants the President other powers that do not involve the medicines was upheld. In said case, it was ruled:
execution of any provision of law, e.g., his power over the country's foreign
relations.

The Chief Executives power to create the Ad hoc Investigating


Committee cannot be doubted. Having been constitutionally granted full
control of the Executive Department, to which respondents belong, the
President has the obligation to ensure that all executive officials and
On these premises, we hold the view that although the 1987 Constitution
employees faithfully comply with the law. With AO 298 as mandate, the
imposes limitations on the exercise of specific powers of the President, it
legality of the investigation is sustained. Such validity is not affected by the
maintains intact what is traditionally considered as within the scope of
fact that the investigating team and the PCAGC had the same composition, or
"executive power." Corollarily, the powers of the President cannot be said to
that the former used the offices and facilities of the latter in conducting the
be limited only to the specific powers enumerated in the Constitution. In other
inquiry. [Emphasis supplied]
words, executive power is more than the sum of specific powers so
enumerated.

It should be stressed that the purpose of allowing ad hoc investigating bodies


to exist is to allow an inquiry into matters which the President is entitled to
know so that he can be properly advised and guided in the performance of his department. He has the authority to directly assume the functions of the
duties relative to the execution and enforcement of the laws of the land. And executive department.[57]
if history is to be revisited, this was also the objective of the investigative
bodies created in the past like the PCAC, PCAPE, PARGO, the Feliciano
Commission, the Melo Commission and the Zenarosa Commission. There
Invoking this authority, the President constituted the PTC to primarily
being no changes in the government structure, the Court is not inclined to
investigate reports of graft and corruption and to recommend the appropriate
declare such executive power as non-existent just because the direction of
action. As previously stated, no quasi-judicial powers have been vested in the
the political winds have changed.
said body as it cannot adjudicate rights of persons who come before it. It has
been said that Quasi-judicial powers involve the power to hear and determine
questions of fact to which the legislative policy is to apply and to decide in
On the charge that Executive Order No. 1 transgresses the power of Congress accordance with the standards laid down by law itself in enforcing and
to appropriate funds for the operation of a public office, suffice it to say that administering the same law.[58] In simpler terms, judicial discretion is involved
there will be no appropriation but only an allotment or allocations of existing in the exercise of these quasi-judicial power, such that it is exclusively vested
funds already appropriated. Accordingly, there is no usurpation on the part of in the judiciary and must be clearly authorized by the legislature in the case
the Executive of the power of Congress to appropriate funds. Further, there is of administrative agencies.
no need to specify the amount to be earmarked for the operation of the
commission because, in the words of the Solicitor General, whatever funds
the Congress has provided for the Office of the President will be the very
The distinction between the power to investigate and the power to adjudicate
source of the funds for the commission.[55] Moreover, since the amount that
was delineated by the Court in Cario v. Commission on Human Rights.
would be allocated to the PTC shall be subject to existing auditing rules and [59]
Thus:
regulations, there is no impropriety in the funding.

"Investigate," commonly understood, means to examine, explore, inquire or


Power of the Truth Commission to Investigate
delve or probe into, research on, study. The dictionary definition of
"investigate" is "to observe or study closely: inquire into systematically: "to
search or inquire into: x x to subject to an official probe x x: to conduct an
The Presidents power to conduct investigations to ensure that laws are official inquiry." The purpose of investigation, of course, is to discover, to find
faithfully executed is well recognized. It flows from the faithful-execution out, to learn, obtain information. Nowhere included or intimated is the notion
clause of the Constitution under Article VII, Section 17 thereof.[56] As the Chief of settling, deciding or resolving a controversy involved in the facts inquired
Executive, the president represents the government as a whole and sees to it into by application of the law to the facts established by the inquiry.
that all laws are enforced by the officials and employees of his
The legal meaning of "investigate" is essentially the same: "(t)o follow up as may be provided by law.[60] Even respondents themselves admit that the
step by step by patient inquiry or observation. To trace or track; to search commission is bereft of any quasi-judicial power.[61]
into; to examine and inquire into with care and accuracy; to find out by
careful inquisition; examination; the taking of evidence; a legal inquiry;" "to
inquire; to make an investigation," "investigation" being in turn described as
Contrary to petitioners apprehension, the PTC will not supplant the
"(a)n administrative function, the exercise of which ordinarily does not require
Ombudsman or the DOJ or erode their respective powers. If at all, the
a hearing. 2 Am J2d Adm L Sec. 257; x x an inquiry, judicial or otherwise, for
investigative function of the commission will complement those of the two
the discovery and collection of facts concerning a certain matter or matters."
offices. As pointed out by the Solicitor General, the recommendation to
prosecute is but a consequence of the overall task of the commission to
conduct a fact-finding investigation.[62] The actual prosecution of suspected
"Adjudicate," commonly or popularly understood, means to adjudge, offenders, much less adjudication on the merits of the charges against them,
[63]
arbitrate, judge, decide, determine, resolve, rule on, settle. The dictionary is certainly not a function given to the commission. The phrase, when in
defines the term as "to settle finally (the rights and duties of the parties to a the course of its investigation, under Section 2(g), highlights this fact and
court case) on the merits of issues raised: x x to pass judgment on: settle gives credence to a contrary interpretation from that of the petitioners. The
judicially: x x act as judge." And "adjudge" means "to decide or rule upon as function of determining probable cause for the filing of the appropriate
a judge or with judicial or quasi-judicial powers: x x to award or grant complaints before the courts remains to be with the DOJ and the
judicially in a case of controversy x x." Ombudsman.[64]

In the legal sense, "adjudicate" means: "To settle in the exercise of judicial
authority. To determine finally. Synonymous with adjudge in its strictest
sense;" and "adjudge" means: "To pass on judicially, to decide, settle or At any rate, the Ombudsmans power to investigate under R.A. No. 6770 is
decree, or to sentence or condemn. x x. Implies a judicial determination of a not exclusive but is shared with other similarly authorized government
fact, and the entry of a judgment." [Italics included. Citations Omitted] agencies. Thus, in the case of Ombudsman v. Galicia,[65] it was written:

Fact-finding is not adjudication and it cannot be likened to the judicial This power of investigation granted to the Ombudsman by the 1987
function of a court of justice, or even a quasi-judicial agency or office. The Constitution and The Ombudsman Act is not exclusive but is shared with
function of receiving evidence and ascertaining therefrom the facts of a other similarly authorized government agencies such as the PCGG and
controversy is not a judicial function. To be considered as such, the act of judges of municipal trial courts and municipal circuit trial courts. The power to
receiving evidence and arriving at factual conclusions in a controversy must conduct preliminary investigation on charges against public employees and
be accompanied by the authority of applying the law to the factual officials is likewise concurrently shared with the Department of Justice.
conclusions to the end that the controversy may be decided or resolved Despite the passage of the Local Government Code in 1991, the Ombudsman
authoritatively, finally and definitively, subject to appeals or modes of review retains concurrent jurisdiction with the Office of the President and the
local Sanggunians to investigate complaints against local elective officials. The same holds true with respect to the DOJ. Its authority under Section 3
[Emphasis supplied]. (2), Chapter 1, Title III, Book IV in the Revised Administrative Code is by no
means exclusive and, thus, can be shared with a body likewise tasked to
investigate the commission of crimes.

Also, Executive Order No. 1 cannot contravene the power of the Ombudsman Finally, nowhere in Executive Order No. 1 can it be inferred that the findings
to investigate criminal cases under Section 15 (1) of R.A. No. 6770, which of the PTC are to be accorded conclusiveness. Much like its predecessors, the
states: Davide Commission, the Feliciano Commission and the Zenarosa Commission,
its findings would, at best, be recommendatory in nature. And being so, the
Ombudsman and the DOJ have a wider degree of latitude to decide whether
(1) Investigate and prosecute on its own or on complaint by any person, any or not to reject the recommendation. These offices, therefore, are not
act or omission of any public officer or employee, office or agency, when such deprived of their mandated duties but will instead be aided by the reports of
act or omission appears to be illegal, unjust, improper or inefficient. It the PTC for possible indictments for violations of graft laws.
has primary jurisdiction over cases cognizable by the Sandiganbayan and,
in the exercise of its primary jurisdiction, it may take over, at any stage,
from any investigatory agency of government, the investigation of Violation of the Equal Protection Clause
such cases. [Emphases supplied]

Although the purpose of the Truth Commission falls within the investigative
power of the President, the Court finds difficulty in upholding the
constitutionality of Executive Order No. 1 in view of its apparent transgression
The act of investigation by the Ombudsman as enunciated above
of the equal protection clause enshrined in Section 1, Article III (Bill of Rights)
contemplates the conduct of a preliminary investigation or the determination
of the 1987 Constitution. Section 1 reads:
of the existence of probable cause. This is categorically out of the PTCs
sphere of functions. Its power to investigate is limited to obtaining facts so
that it can advise and guide the President in the performance of his duties
relative to the execution and enforcement of the laws of the land. In this Section 1. No person shall be deprived of life, liberty, or property without due
regard, the PTC commits no act of usurpation of the Ombudsmans primordial process of law, nor shall any person be denied the equal protection of
duties. the laws.
The petitioners assail Executive Order No. 1 because it is violative of this the commission would confine its proceedings to officials of the previous
constitutional safeguard. They contend that it does not apply equally to all administration, the petitioners argue that no offense is committed against the
members of the same class such that the intent of singling out the previous equal protection clause for the segregation of the transactions of public
administration as its sole object makes the PTC an adventure in partisan officers during the previous administration as possible subjects of
hostility.[66] Thus, in order to be accorded with validity, the commission must investigation is a valid classification based on substantial distinctions and is
also cover reports of graft and corruption in virtually all administrations germane to the evils which the Executive Order seeks to correct.[72] To
previous to that of former President Arroyo.[67] distinguish the Arroyo administration from past administrations, it recited the
following:

The petitioners argue that the search for truth behind the reported cases of
graft and corruption must encompass acts committed not only during the First. E.O. No. 1 was issued in view of widespread reports of large scale graft
administration of former President Arroyo but also during prior and corruption in the previous administration which have eroded public
administrations where the same magnitude of controversies and confidence in public institutions. There is, therefore, an urgent call for the
anomalies[68] were reported to have been committed against the Filipino determination of the truth regarding certain reports of large scale graft and
people. They assail the classification formulated by the respondents as it does corruption in the government and to put a closure to them by the filing of the
not fall under the recognized exceptions because first, there is no substantial appropriate cases against those involved, if warranted, and to deter others
distinction between the group of officials targeted for investigation by from committing the evil, restore the peoples faith and confidence in the
Executive Order No. 1 and other groups or persons who abused their public Government and in their public servants.
office for personal gain; and second, the selective classification is not
germane to the purpose of Executive Order No. 1 to end corruption.[69] In
order to attain constitutional permission, the petitioners advocate that the
Second. The segregation of the preceding administration as the object of fact-
commission should deal with graft and grafters prior and subsequent to the
finding is warranted by the reality that unlike with administrations long gone,
Arroyo administration with the strong arm of the law with equal force.[70]
the current administration will most likely bear the immediate consequence of
the policies of the previous administration.

Position of respondents

Third. The classification of the previous administration as a separate class for


investigation lies in the reality that the evidence of possible criminal activity,
According to respondents, while Executive Order No. 1 identifies the previous the evidence that could lead to recovery of public monies illegally dissipated,
administration as the initial subject of the investigation, following Section 17 the policy lessons to be learned to ensure that anti-corruption laws are
thereof, the PTC will not confine itself to cases of large scale graft and faithfully executed, are more easily established in the regime that
corruption solely during the said administration.[71] Assuming arguendo that immediately precede the current administration.
According to a long line of decisions, equal protection simply requires that all
persons or things similarly situated should be treated alike, both as to rights
Fourth. Many administrations subject the transactions of their predecessors to conferred and responsibilities imposed.[75] It requires public bodies and
investigations to provide closure to issues that are pivotal to national life or institutions to treat similarly situated individuals in a similar manner.[76] The
even as a routine measure of due diligence and good housekeeping by a purpose of the equal protection clause is to secure every person within a
nascent administration like the Presidential Commission on Good Government states jurisdiction against intentional and arbitrary discrimination, whether
(PCGG), created by the late President Corazon C. Aquino under Executive occasioned by the express terms of a statue or by its improper execution
Order No. 1 to pursue the recovery of ill-gotten wealth of her predecessor through the states duly constituted authorities.[77] In other words, the concept
former President Ferdinand Marcos and his cronies, and of equal justice under the law requires the state to govern impartially, and it
the Saguisag Commission created by former President Joseph Estrada under may not draw distinctions between individuals solely on differences that are
Administrative Order No, 53, to form an ad-hoc and independent citizens irrelevant to a legitimate governmental objective.[78]
committee to investigate all the facts and circumstances surrounding
Philippine Centennial projects of his predecessor, former President Fidel V.
Ramos.[73] [Emphases supplied]
The equal protection clause is aimed at all official state actions, not just those
of the legislature.[79] Its inhibitions cover all the departments of the
government including the political and executive departments, and extend to
Concept of the Equal Protection Clause all actions of a state denying equal protection of the laws, through whatever
agency or whatever guise is taken. [80]

One of the basic principles on which this government was founded is that of
the equality of right which is embodied in Section 1, Article III of the 1987 It, however, does not require the universal application of the laws to all
Constitution. The equal protection of the laws is embraced in the concept of persons or things without distinction. What it simply requires is equality
due process, as every unfair discrimination offends the requirements of among equals as determined according to a valid classification. Indeed, the
justice and fair play. It has been embodied in a separate clause, however, to equal protection clause permits classification. Such classification, however, to
provide for a more specific guaranty against any form of undue favoritism or be valid must pass the test of reasonableness. The test has four requisites:
hostility from the government. Arbitrariness in general may be challenged on (1) The classification rests on substantial distinctions; (2) It is germane to the
the basis of the due process clause. But if the particular act assailed partakes purpose of the law; (3) It is not limited to existing conditions only; and
of an unwarranted partiality or prejudice, the sharper weapon to cut it down (4) It applies equally to all members of the same class.[81] Superficial
is the equal protection clause.[74] differences do not make for a valid classification.[82]
For a classification to meet the requirements of constitutionality, it must
include or embrace all persons who naturally belong to the class.[83] The
classification will be regarded as invalid if all the members of the class are not The equal protection of the laws clause of the Constitution allows
similarly treated, both as to rights conferred and obligations imposed. It is not classification. Classification in law, as in the other departments of knowledge
necessary that the classification be made with absolute symmetry, in the or practice, is the grouping of things in speculation or practice because they
sense that the members of the class should possess the same characteristics agree with one another in certain particulars. A law is not invalid because of
in equal degree. Substantial similarity will suffice; and as long as this is simple inequality. The very idea of classification is that of inequality, so that it
achieved, all those covered by the classification are to be treated equally. The goes without saying that the mere fact of inequality in no manner determines
mere fact that an individual belonging to a class differs from the other the matter of constitutionality. All that is required of a valid classification is
members, as long as that class is substantially distinguishable from all others, that it be reasonable, which means that the classification should be based on
does not justify the non-application of the law to him.[84] 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.
This Court has held that the standard is satisfied if the classification or
The classification must not be based on existing circumstances only, or so distinction is based on a reasonable foundation or rational basis and is not
constituted as to preclude addition to the number included in the class. It palpably arbitrary. [Citations omitted]
must be of such a nature as to embrace all those who may thereafter be in
similar circumstances and conditions. It must not leave out or underinclude
those that should otherwise fall into a certain classification. As elucidated
in Victoriano v. Elizalde Rope Workers' Union[85] and reiterated in a long line of Applying these precepts to this case, Executive Order No. 1 should be struck
cases,[86] down as violative of the equal protection clause. The clear mandate of the
envisioned truth commission is to investigate and find out the truth
The guaranty of equal protection of the laws is not a guaranty of equality in concerning the reported cases of graft and corruption during the previous
the application of the laws upon all citizens of the state. It is not, therefore, a administration[87] only. The intent to single out the previous administration is
requirement, in order to avoid the constitutional prohibition against plain, patent and manifest. Mention of it has been made in at least three
inequality, that every man, woman and child should be affected alike by a portions of the questioned executive order. Specifically, these are:
statute. Equality of operation of statutes does not mean indiscriminate
operation on persons merely as such, but on persons according to the
circumstances surrounding them. It guarantees equality, not identity of
WHEREAS, there is a need for a separate body dedicated solely to
rights. The Constitution does not require that things which are different in fact
investigating and finding out the truth concerning the reported cases of graft
be treated in law as though they were the same. The equal protection clause
and corruption during the previous administration, and which will
does not forbid discrimination as to things that are different. It does not
recommend the prosecution of the offenders and secure justice for all;
prohibit legislation which is limited either in the object to which it is directed
or by the territory within which it is to operate.
SECTION 1. Creation of a Commission. There is hereby created Though the OSG enumerates several differences between the Arroyo
the PHILIPPINE TRUTH COMMISSION, hereinafter referred to as administration and other past administrations, these distinctions are not
the COMMISSION, which shall primarily seek and find the truth on, and substantial enough to merit the restriction of the investigation to the previous
toward this end, investigate reports of graft and corruption of such scale and administration only. The reports of widespread corruption in the Arroyo
magnitude that shock and offend the moral and ethical sensibilities of the administration cannot be taken as basis for distinguishing said administration
people, committed by public officers and employees, their co-principals, from earlier administrations which were also blemished by similar widespread
accomplices and accessories from the private sector, if any, during reports of impropriety. They are not inherent in, and do not inure solely to,
the previous administration; and thereafter recommend the appropriate the Arroyo administration. As Justice Isagani Cruz put it, Superficial
action or measure to be taken thereon to ensure that the full measure of differences do not make for a valid classification.[88]
justice shall be served without fear or favor.

SECTION 2. Powers and Functions. The Commission, which shall have all the
powers of an investigative body under Section 37, Chapter 9, Book I of the The public needs to be enlightened why Executive Order No. 1 chooses to
Administrative Code of 1987, is primarily tasked to conduct a thorough fact- limit the scope of the intended investigation to the previous administration
finding investigation of reported cases of graft and corruption referred to in only. The OSG ventures to opine that to include other past administrations, at
Section 1, involving third level public officers and higher, their co-principals, this point, may unnecessarily overburden the commission and lead it to lose
accomplices and accessories from the private sector, if any, during its effectiveness.[89] The reason given is specious. It is without doubt
the previous administration and thereafter submit its finding and irrelevant to the legitimate and noble objective of the PTC to stamp out or
recommendations to the President, Congress and the Ombudsman. end corruption and the evil it breeds.[90]
[Emphases supplied]

The probability that there would be difficulty in unearthing evidence or that


In this regard, it must be borne in mind that the Arroyo administration is but the earlier reports involving the earlier administrations were already inquired
just a member of a class, that is, a class of past administrations. It is not a into is beside the point. Obviously, deceased presidents and cases which have
class of its own. Not to include past administrations similarly situated already prescribed can no longer be the subjects of inquiry by the PTC.
constitutes arbitrariness which the equal protection clause cannot Neither is the PTC expected to conduct simultaneous investigations of
sanction. Such discriminating differentiation clearly reverberates to label the previous administrations, given the bodys limited time and resources. The law
commission as a vehicle for vindictiveness and selective retribution. does not require the impossible (Lex non cogit ad impossibilia).[91]
Given the foregoing physical and legal impossibility, the Court logically of the Constitution. To exclude the earlier administrations in the guise of
recognizes the unfeasibility of investigating almost a centurys worth of graft substantial distinctions would only confirm the petitioners lament that the
cases. However, the fact remains that Executive Order No. 1 suffers from subject executive order is only an adventure in partisan hostility. In the case
arbitrary classification. The PTC, to be true to its mandate of searching for the of US v. Cyprian,[95] it was written: A rather limited number of such
truth, must not exclude the other past administrations. The PTC must, at classifications have routinely been held or assumed to be arbitrary; those
least, have the authority to investigate all past include: race, national origin, gender, political activity or membership in a
administrations. While reasonable prioritization is permitted, it should not political party, union activity or membership in a labor union, or more
be arbitrary lest it be struck down for being unconstitutional. In the often generally the exercise of first amendment rights.
quoted language of Yick Wo v. Hopkins,[92]

To reiterate, in order for a classification to meet the requirements of


constitutionality, it must include or embrace all persons who naturally belong
to the class.[96] Such a classification must not be based on existing
circumstances only, or so constituted as to preclude additions to the number
included within a class, but must be of such a nature as to embrace all those
Though the law itself be fair on its face and impartial in appearance, yet, if
who may thereafter be in similar circumstances and conditions. Furthermore,
applied and administered by public authority with an evil eye and an unequal
all who are in situations and circumstances which are relative to the
hand, so as practically to make unjust and illegal discriminations between
discriminatory legislation and which are indistinguishable from those of the
persons in similar circumstances, material to their rights, the denial of
members of the class must be brought under the influence of the law and
equal justice is still within the prohibition of the
treated by it in the same way as are the members of the class.[97]
constitution. [Emphasis supplied]

The Court is not unaware that mere underinclusiveness is not fatal to the
It could be argued that considering that the PTC is an ad hoc body, its scope
validity of a law under the equal protection clause.[98] Legislation is not
is limited. The Court, however, is of the considered view that although its
unconstitutional merely because it is not all-embracing and does not include
focus is restricted, the constitutional guarantee of equal protection under the
all the evils within its reach.[99] It has been written that a regulation
laws should not in any way be circumvented. The Constitution is the
challenged under the equal protection clause is not devoid of a rational
fundamental and paramount law of the nation to which all other laws must
predicate simply because it happens to be incomplete.[100] In several
conform and in accordance with which all private rights determined and all
instances, the underinclusiveness was not considered a valid reason to strike
public authority administered.[93] Laws that do not conform to the Constitution
down a law or regulation where the purpose can be attained in future
should be stricken down for being unconstitutional.[94] While the thrust of the
legislations or regulations. These cases refer to the step by step process.
PTC is specific, that is, for investigation of acts of graft and corruption, [101]
With regard to equal protection claims, a legislature does not run the risk
Executive Order No. 1, to survive, must be read together with the provisions
of losing the entire remedial scheme simply because it fails, through The Court is not convinced. Although Section 17 allows the President the
inadvertence or otherwise, to cover every evil that might conceivably have discretion to expand the scope of investigations of the PTC so as to include
been attacked.[102] the acts of graft and corruption committed in other past administrations, it
does not guarantee that they would be covered in the future. Such expanded
mandate of the commission will still depend on the whim and caprice of the
President. If he would decide not to include them, the section would then be
In Executive Order No. 1, however, there is no inadvertence. That the
meaningless. This will only fortify the fears of the petitioners that the
previous administration was picked out was deliberate and intentional as can
Executive Order No. 1 was crafted to tailor-fit the prosecution of officials and
be gleaned from the fact that it was underscored at least three times in the
personalities of the Arroyo administration.[105]
assailed executive order. It must be noted that Executive Order No. 1 does
not even mention any particular act, event or report to be focused on unlike
the investigative commissions created in the past. The equal protection clause
is violated by purposeful and intentional discrimination.[103]

To disprove petitioners contention that there is deliberate discrimination, the The Court tried to seek guidance from the pronouncement in the case
OSG clarifies that the commission does not only confine itself to cases of large of Virata v. Sandiganbayan,[106] that the PCGG Charter (composed of
scale graft and corruption committed during the previous administration. Executive Orders Nos. 1, 2 and 14) does not violate the equal protection
[104]
The OSG points to Section 17 of Executive Order No. 1, which provides: clause. The decision, however, was devoid of any discussion on how such
conclusory statement was arrived at, the principal issue in said case being
only the sufficiency of a cause of action.

SECTION 17. Special Provision Concerning Mandate. If and when in the A final word
judgment of the President there is a need to expand the mandate of the
Commission as defined in Section 1 hereof to include the investigation of
cases and instances of graft and corruption during the prior administrations,
such mandate may be so extended accordingly by way of a supplemental The issue that seems to take center stage at present is - whether or not the
Executive Order. Supreme Court, in the exercise of its constitutionally mandated power of
Judicial Review with respect to recent initiatives of the legislature and the
executive department, is exercising undue interference. Is the Highest
Tribunal, which is expected to be the protector of the Constitution, itself guilty
of violating fundamental tenets like the doctrine of separation of powers?
Time and again, this issue has been addressed by the Court, but it seems that Constitution and to establish for the parties in an actual controversy the rights
the present political situation calls for it to once again explain the legal basis which that instrument secures and guarantees to them.[107]
of its action lest it continually be accused of being a hindrance to the nations
thrust to progress.

Thus, the Court, in exercising its power of judicial review, is not imposing its
own will upon a co-equal body but rather simply making sure that any act of
The Philippine Supreme Court, according to Article VIII, Section 1 of the 1987 government is done in consonance with the authorities and rights allocated to
Constitution, is vested with Judicial Power that includes the duty of the courts it by the Constitution. And, if after said review, the Court finds no
of justice to settle actual controversies involving rights which are legally constitutional violations of any sort, then, it has no more authority of
demandable and enforceable, and to determine whether or not there has proscribing the actions under review. Otherwise, the Court will not be
been a grave of abuse of discretion amounting to lack or excess of jurisdiction deterred to pronounce said act as void and unconstitutional.
on the part of any branch or instrumentality of the government.

It cannot be denied that most government actions are inspired with noble
Furthermore, in Section 4(2) thereof, it is vested with the power of judicial intentions, all geared towards the betterment of the nation and its people. But
review which is the power to declare a treaty, international or executive then again, it is important to remember this ethical principle: The end does
agreement, law, presidential decree, proclamation, order, instruction, not justify the means. No matter how noble and worthy of admiration the
ordinance, or regulation unconstitutional. This power also includes the duty to purpose of an act, but if the means to be employed in accomplishing it is
rule on the constitutionality of the application, or operation of presidential simply irreconcilable with constitutional parameters, then it cannot still be
decrees, proclamations, orders, instructions, ordinances, and other allowed.[108] The Court cannot just turn a blind eye and simply let it pass. It
regulations. These provisions, however, have been fertile grounds of conflict will continue to uphold the Constitution and its enshrined principles.
between the Supreme Court, on one hand, and the two co-equal bodies of
government, on the other. Many times the Court has been accused of
asserting superiority over the other departments.
The Constitution must ever remain supreme. All must bow to the mandate of
this law. Expediency must not be allowed to sap its strength nor greed for
power debase its rectitude.[109]
To answer this accusation, the words of Justice Laurel would be a good source
of enlightenment, to wit: And when the judiciary mediates to allocate
constitutional boundaries, it does not assert any superiority over the other
departments; it does not in reality nullify or invalidate an act of the
legislature, but only asserts the solemn and sacred obligation assigned to it Lest it be misunderstood, this is not the death knell for a truth commission as
by the Constitution to determine conflicting claims of authority under the nobly envisioned by the present administration. Perhaps a revision of the
executive issuance so as to include the earlier past
administrations would allow it to pass the test of reasonableness and
not be an affront to the Constitution. Of all the branches of the
government, it is the judiciary which is the most interested in knowing the
truth and so it will not allow itself to be a hindrance or obstacle to its
attainment. It must, however, be emphasized that the search for the truth
must be within constitutional bounds for ours is still a government of laws and
not of men.[110]

WHEREFORE, the petitions are GRANTED. Executive Order No. 1 is hereby


declared UNCONSTITUTIONAL insofar as it is violative of the equal protection
clause of the Constitution.

As also prayed for, the respondents are hereby ordered to cease and desist
from carrying out the provisions of Executive Order No. 1.

SO ORDERED.
ECOND DIVISION
KAPISANAN NG MGA KAWANI NG G.R. No. 150974
ENERGY REGULATORY BOARD,
x------------------------------------------------
Petitioner, --x
Present:

QUISUMBING,* J.,
DECISION
Chairperson,

CARPIO,**
- versus - CARPIO, J.:
CARPIO MORALES,

TINGA, and
The Case
VELASCO, JR., JJ.

This is a special civil action for certiorari and prohibition[1] of the selection and
appointment of employees of the Energy Regulatory Commission (ERC) by the
COMMISSIONER FE B. BARIN, ERC Board of Commissioners.
DEPUTY COMMISSIONERS CARLOS R.
ALINDADA, LETICIA V. IBAY, OLIVER
B. BUTALID, and MARY ANNE B.
COLAYCO, of the ENERGY Petitioner Kapisanan ng mga Kawani ng Energy Regulatory Board (KERB)
REGULATORY COMMISSION, seeks to declare Section 38 of Republic Act No. 9136 (RA 9136), which
abolished the Energy Regulatory Board (ERB) and created the ERC, as
Respondents. unconstitutional and to prohibit the ERC Commissioners from filling up
the ERCs plantilla.

Promulgated:

June 29, 2007


The Facts The existing personnel of the ERB, if qualified, shall be given preference in the
filling up of plantilla positions created in the ERC, subject to existing civil
service rules and regulations.

RA 9136, popularly known as EPIRA (for Electric Power Industry Reform Act of At the time of the filing of this petition, the ERC was composed of
2001), was enacted on 8 June 2001 and took effect on 26 June 2001. Section Commissioner Fe B. Barin and Deputy Commissioners Carlos R. Alindada,
38 of RA 9136 provides for the abolition of the ERB and the creation of the Leticia V. Ibay, Oliver B. Butalid, and Mary Anne B. Colayco (collectively,
ERC. The pertinent portions of Section 38 read: Commissioners). The Commissioners assumed office on 15 August
2001. Pursuant to Section 38 of RA 9136, the Commissioners issued the
proposed Table of Organization, Staffing Pattern, and Salary Structure on 25
Creation of the Energy Regulatory Commission. There is hereby created an September 2001 which the President of the Philippines approved on 13
independent, quasi-judicial regulatory board to be named the Energy November 2001.Meanwhile, KERB submitted to the Commissioners
Regulatory Commission (ERC). For this purpose, the existing Energy its Resolution No. 2001-02 on 13 September 2001. Resolution No. 2001-02
Regulatory Board (ERB) created under Executive Order No. 172, as amended, requested the Commissioners for an opportunity to be informed on the
is hereby abolished. proposed plantilla positions with their equivalent qualification standards.

The Commission shall be composed of a Chairman and four (4) members to


be appointed by the President of the Philippines. x x x
On 17 October 2001, the Commissioners issued the guidelines for the
Within three (3) months from the creation of the ERC, the Chairman shall selection and hiring of ERC employees. A portion of the guidelines reflects the
submit for the approval of the President of the Philippines the new Commissioners view on the selection and hiring of the ERC employees vis-a-
organizational structure and plantilla positions necessary to carry out the vis Civil Service rules, thus:
powers and functions of the ERC.

xxxx
Since R.A. 9136 has abolished the Energy Regulatory Board (ERB), it is the
The Chairman and members of the Commission shall assume office at the view of the Commission that the provisions of Republic Act No. 6656 (An Act
beginning of their terms: Provided, That, if upon the effectivity of this Act, the to Protect the Security of [Tenure of] Civil Service Officers and Employees in
Commission has not been constituted and the new staffing pattern the Implementation of Government Reorganization) will not directly apply
and plantilla positions have not been approved and filled-up, the current to ERCs current efforts to establish a new organization. Civil Service laws,
Board and existing personnel of ERB shall continue to hold office. rules and regulations, however, will have suppletory application to the extent
possible in regard to the selection and placement of employees in the ERC.
[2]
(Emphasis supplied)
On 5 November 2005, KERB sent a letter to the Commissioners stating the qualification standards from the ERC. The ERC formed a Selection Committee
KERB members objection to the Commissioners stand that Civil Service laws, to process all applications.
rules and regulations have suppletory application in the selection and
placement of the ERC employees. KERB asserted that RA 9136 did not abolish
the ERB or change the ERBs character as an economic regulator of the electric
KERB, fearful of the uncertainty of the employment status of its members,
power industry. KERB insisted that RA 9136 merely changed the ERBs name
filed the present petition on 20 December 2001. KERB later filed an Urgent
to the ERC and expanded the ERBs functions and objectives.KERB sent the
Ex Parte Motion to Enjoin Termination of Petitioner ERB Employees on 2
Commissioners yet another letter on 13 November 2001. KERB made a
January 2002. However, before the ERC received KERBs pleadings, the
number of requests: (1) the issuance of a formal letter related to the date of
Selection Committee already presented its list of proposed appointees to the
filing of job applications, including the use of Civil Service application form no.
Commissioners.
212; (2) the creation of a placement/recruitment committee and setting
guidelines relative to its functions, without prejudice to existing Civil Service
rules and regulations; and (3) copies of the plantilla positions and their
corresponding qualification standards duly approved by either the President of In their Comment, the Commissioners describe the status of the ERB
the Philippines or the Civil Service Commission (CSC). employees appointment in the ERC as follows:

Commissioner Barin replied to KERBs letter on 15 November 2001. She stated As of February 1, 2002, of the two hundred twelve (212) ERB employees, one
that Civil Service application form no. 212 and the ERC-prescribed application hundred thirty eighty [sic] (138) were rehired and appointed to
format are substantially the same. Furthermore, the creation of a ERC plantilla positions and sixty six (66) opted to retire or be separated from
placement/recruitment committee is no longer necessary because there is the service. Those who were rehired and those who opted to retire or be
already a prescribed set of guidelines for the recruitment of personnel. The separated constituted about ninety six (96%) percent of the entire ERB
ERC hired an independent consultant to administer the necessary tests for the employees. The list of the ERB employees appointed to new positions in the
technical and managerial levels. Finally, the ERC already posted ERC is attached hereto as Annex 1. Only eight (8) ERB employees could not
the plantilla positions, which prescribe higher standards, as approved by the be appointed to new positions due to the reduction of the ERC plantilla and
Department of Budget and Management. Commissioner Barin stated that the absence of positions appropriate to their respective qualifications and
positions in the ERC do not need the prior approval of the CSC, as the ERC is skills. The appropriate notice was issued to each of them informing them of
only required to submit the qualification standards to the CSC. their separation from the service and assuring them of their entitlement to
separation pay and other benefits in accordance with existing laws.[3]

On 5 December 2001, the ERC published a classified advertisement in the


Philippine Star. Two days later, the CSC received a list of vacancies and The Issues
KERB raises the following issues before this Court: All laws enjoy the presumption of constitutionality. To justify the nullification
of a law, there must be a clear and unequivocal breach of the
Constitution. KERB failed to show any breach of the Constitution.

1. Whether Section 38 of RA 9136 abolishing the ERB is constitutional;


and
A public office is created by the Constitution or by law or by an officer or
tribunal to which the power to create the office has been delegated by the
legislature.[6] The power to create an office carries with it the power to
2. Whether the Commissioners of the ERC were correct in disregarding and
abolish. President Corazon C. Aquino, then exercising her legislative powers,
considering merely suppletory in character the protective mantle of RA 6656
created the ERB by issuing Executive Order No. 172 on 8 May 1987.
as to the ERB employees or petitioner in this case.[4]

The question of whether a law abolishes an office is a question of legislative


The Ruling of the Court
intent. There should not be any controversy if there is an explicit declaration
of abolition in the law itself.[7] Section 38 of RA 9136 explicitly abolished the
ERB. However, abolition of an office and its related positions is different from
The petition has no merit. removal of an incumbent from his office.Abolition and removal are mutually
exclusive concepts. From a legal standpoint, there is no occupant in an
abolished office. Where there is no occupant, there is no tenure to speak
We disregard the procedural defects in the petition, such of. Thus, impairment of the constitutional guarantee of security of tenure
as KERBs personality to file the petition on behalf of its alleged members does not arise in the abolition of an office. On the other hand, removal implies
and Elmar Agirs authority to institute the action, because of the demands of that the office and its related positions subsist and that the occupants are
public interest.[5] merely separated from their positions.[8]

A valid order of abolition must not only come from a legitimate body, it must
also be made in good faith. An abolition is made in good faith when it is not
Constitutionality of the ERBs Abolition made for political or personal reasons, or when it does not circumvent the
constitutional security of tenure of civil service employees.[9] Abolition of an
and the ERCs Creation office may be brought about by reasons of economy, or to remove
redundancy of functions, or a clear and explicit constitutional mandate for (d) Where there is a reclassification of offices in the department or agency
such termination of employment.[10] Where one office is abolished and concerned and the reclassified offices perform substantially the same function
replaced with another office vested with similar functions, the abolition is a as the original offices;
legal nullity.[11] When there is a void abolition, the incumbent is deemed to
have never ceased holding office. (e) Where the removal violates the order of separation provided in Section 3
hereof.

KERB asserts that there was no valid abolition of the ERB but there was
merely a reorganization done in bad faith. Evidences of bad faith are KERB claims that the present case falls under the situation described in
enumerated in Section 2 of Republic Act No. 6656 (RA 6656),[12] Section 2 of Section 2(b) of RA 6656. We thus need to compare the provisions
RA 6656 reads: enumerating the powers and functions of the ERB and the ERC to see whether
they have substantially the same functions. Under Executive Order No. 172,
the ERB has the following powers and functions:

No officer or employee in the career service shall be removed except for a


valid cause and after due notice and hearing. A valid cause for removal exists
when, pursuant to a bona fidereorganization, a position has been abolished or SEC. 3. Jurisdiction, Powers and Functions of the Board. ― When warranted
rendered redundant or there is a need to merge, divide, or consolidate and only when public necessity requires, the Board may regulate the business
positions in order to meet the exigencies of the service, or other lawful causes of importing, exporting, re-exporting, shipping, transporting, processing,
allowed by the Civil Service Law. The existence of any or some of the refining, marketing and distributing energy resources. Energy resource means
following circumstances may be considered as evidence of bad faith in the any substance or phenomenon which by itself or in combination with others,
removals made as a result of reorganization, giving rise to a claim for or after processing or refining or the application to it of technology,
reinstatement or reappointment by an aggrieved party: emanates, generates or causes the emanation or generation of energy, such
as but not limited to, petroleum or petroleum products, coal, marsh gas,
(a) Where there is a significant increase in the number of positions in the new methane gas, geothermal and hydroelectric sources of energy, uranium and
staffing pattern of the department or agency concerned; other similar radioactive minerals, solar energy, tidal power, as well as non-
conventional existing and potential sources.
(b) Where an office is abolished and another performing substantially the
same functions is created; The Board shall, upon proper notice and hearing, exercise the following,
among other powers and functions:
(c) Where incumbents are replaced by those less qualified in terms of status
of appointment, performance and merit; (a) Fix and regulate the prices of petroleum products;
(b) Fix and regulate the rate schedule or prices of piped gas to be charged by Board. The power to fix and regulate the rates or charges pertinent to
duly franchised gas companies which distribute gas by means of underground shipping or transporting of petroleum products shall also be exercised by the
pipe system; Board.

(c) Fix and regulate the rates of pipeline concessionaires under the provisions The foregoing transfer of powers and functions shall include applicable funds
of Republic Act No. 387, as amended, otherwise known as the Petroleum Act and appropriations, records, equipment, property and such personnel as may
of 1949, as amended by Presidential Decree No. 1700; be necessary; Provided, That with reference to paragraph (b) of Section 4
hereof, only such amount of funds and appropriations of the Bureau of Energy
(d) Regulate the capacities of new refineries or additional capacities of Utilization, as well as only the personnel thereof who are completely or
existing refineries and license refineries that may be organized after the primarily involved in the exercise by said Bureau of its regulatory and
issuance of this Executive Order, under such terms and conditions as are adjudicatory powers and functions, shall be affected by such
consistent with the national interest; transfer: Provided, further, That the funds and appropriations as well as the
records, equipment, property and all personnel of the reorganized Board of
(e) Whenever the Board has determined that there is a shortage of any
Energy shall be transferred to the Energy Regulatory Board.
petroleum product, or when public interest so requires, it may take such steps
as it may consider necessary, including the temporary adjustment of the SEC. 6. Power to Promulgate Rules and Perform Other Acts. ― The Board
levels of prices of petroleum products and the payment to the Oil Price shall have the power to promulgate rules and regulations relevant to
Stabilization Fund created under Presidential Decree No. 1956 by persons or procedures governing hearings before it and enforce compliance with any
entities engaged in the petroleum industry of such amounts as may be rule, regulation, order or other requirements: Provided, That said rules and
determined by the Board, which will enable the importer to recover its cost of regulations shall take effect fifteen (15) days after publication in the Official
importation. Gazette. It shall also perform such other acts as may be necessary or
conducive to the exercise of its powers and functions, and the attainment of
SEC. 4. Reorganized or Abolished Agency. ― (a) The Board of Energy is
the purposes of this Order.
hereby reconstituted into the Energy Regulatory Board, and
the formers powers and functions under Republic Act No. 6173, as amended
by Presidential Decree No. 1208, as amended, are transferred to the latter.
On the other hand, Section 43 of RA 9136 enumerates the basic functions of
(b) The regulatory and adjudicatory powers and functions exercised by the the ERC.
Bureau of Energy Utilization under Presidential Decree No. 1206, as amended,
are transferred to the Board, the provisions of Executive Order No. 131 SEC. 43. Functions of the ERC. ― The ERC shall promote competition,
notwithstanding. encourage market development, ensure customer choice and
discourage/penalize abuse of market power in the restructured electricity
SEC. 5. Other Transferred Powers and Functions. ― The power of the Land industry. In appropriate cases, the ERC is authorized to issue cease
Transportation Commission to determine, fix and/or prescribe rates or and desist order after due notice and hearing. Towards this end, it shall be
charges pertaining to the hauling of petroleum products are transferred to the responsible for the following key functions in the restructured industry:
(a) Enforce the implementing rules and regulations of this Act; (f) In the public interest, establish and enforce a methodology for setting
transmission and distribution wheeling rates and retail rates for the captive
(b) Within six (6) months from the effectivity of this Act, promulgate and market of a distribution utility, taking into account all relevant considerations,
enforce, in accordance with law, a National Grid Code and a Distribution Code including the efficiency or inefficiency of the regulated entities. The rates
which shall include, but not limited to, the following: must be such as to allow the recovery of just and reasonable costs and a
reasonable return on rate base (RORB) to enable the entity to operate viably.
(i) Performance standards for TRANSCO O & M Concessionaire, distribution
The ERC may adopt alternative forms of internationally-accepted rate setting
utilities and suppliers: Provided, That in the establishment of the performance
methodology as it may deem appropriate. The rate-setting methodology so
standards, the nature and function of the entities shall be considered; and
adopted and applied must ensure a reasonable price of electricity. The rates
(ii) Financial capability standards for the generating companies, the prescribed shall be non-discriminatory. To achieve this objective and to
TRANSCO, distribution utilities and suppliers: Provided, That in the ensure the complete removal of cross subsidies, the cap on the recoverable
formulation of the financial capability standards, the nature and function of rate of system losses prescribed in Section 10 of Republic Act No. 7832, is
the entity shall be considered: Provided, further, That such standards are set hereby amended and shall be replaced by caps which shall be determined by
to ensure that the electric power industry participants meet the minimum the ERC based on load density, sales mix, cost of service, delivery voltage
financial standards to protect the public interest. Determine, fix, and approve, and other technical considerations it may promulgate. The ERC shall
after due notice and public hearings the universal charge, to be imposed on determine such form of rate-setting methodology, which shall promote
all electricity end-users pursuant to Section 34 hereof; efficiency. In case the rate setting methodology used is RORB, it shall be
subject to the following guidelines:
(c) Enforce the rules and regulations governing the operations of the
electricity spot market and the activities of the spot market operator and (i) For purposes of determining the rate base, the TRANSCO or any
other participants in the spot market, for the purpose of ensuring a greater distribution utility may be allowed to revalue its eligible assets not more than
supply and rational pricing of electricity; once every three (3) years by an independent appraisal company: Provided,
however, That ERC may give an exemption in case of unusual
(d) Determine the level of cross subsidies in the existing retail rate until the devaluation: Provided, further, That the ERC shall exert efforts to minimize
same is removed pursuant to Section 73 hereof; price shocks in order to protect the consumers;

(e) Amend or revoke, after due notice and hearing, the authority to operate (ii) Interest expenses are not allowable deductions from permissible return on
of any person or entity which fails to comply with the provisions hereof, the rate base;
IRR or any order or resolution of the ERC. In the event a divestment is
required, the ERC shall allow the affected party sufficient time to remedy the (iii) In determining eligible cost of services that will be passed on to the end-
infraction or for an orderly disposal, but shall in no case exceed twelve (12) users, the ERC shall establish minimum efficiency performance standards for
months from the issuance of the order; the TRANSCO and distribution utilities including systems losses, interruption
frequency rates, and collection efficiency;
(iv) Further, in determining rate base, the TRANSCO or any distribution utility (l) Impose fines or penalties for any non-compliance with or breach of this
shall not be allowed to include management inefficiencies like cost of project Act, the IRR of this Act and the rules and regulations which it promulgates or
delays not excused by force majeure, penalties and related interest during administers;
construction applicable to these unexcused delays; and
(m) Take any other action delegated to it pursuant to this Act;

(n) Before the end of April of each year, submit to the Office of the President
of the Philippines and Congress, copy furnished the DOE, an annual report
containing such matters or cases which have been filed before or referred to it
(v) Any significant operating costs or project investments of TRANSCO and during the preceding year, the actions and proceedings undertaken and its
distribution utilities which shall become part of the rate base shall be subject decision or resolution in each case. The ERC shall make copies of such reports
to the verification of the ERC to ensure that the contracting and procurement available to any interested party upon payment of a charge which reflects the
of the equipment, assets and services have been subjected to transparent printing costs. The ERC shall publish all its decisions involving rates and
and accepted industry procurement and purchasing practices to protect the anticompetitive cases in at least one (1) newspaper of general circulation,
public interest. and/or post electronically and circulate to all interested electric power
industry participants copies of its resolutions to ensure fair and impartial
(g) Three (3) years after the imposition of the universal charge, ensure that
treatment;
the charges of the TRANSCO or any distribution utility shall bear no cross
subsidies between grids, within grids, or between classes of customers, (o) Monitor the activities of the generation and supply of the electric power
except as provided herein; industry with the end in view of promoting free market competition and
ensuring that the allocation or pass through of bulk purchase cost by
(h) Review and approve any changes on the terms and conditions of service
distributors is transparent, non-discriminatory and that any existing subsidies
of the TRANSCO or any distribution utility;
shall be divided pro rata among all retail suppliers;
(i) Allow the TRANSCO to charge user fees for ancillary services to all electric
power industry participants or self-generating entities connected to the grid.
Such fees shall be fixed by the ERC after due notice and public hearing; (p) Act on applications for or modifications of certificates of public
convenience and/or necessity, licenses or permits of franchised electric
(j) Set a lifeline rate for the marginalized end-users;
utilities in accordance with law and revoke, review and modify such
(k) Monitor and take measures in accordance with this Act to penalize abuse certificates, licenses or permits in appropriate cases, such as in cases of
of market power, cartelization, and anti-competitive or discriminatory violations of the Grid Code, Distribution Code and other rules and regulations
behavior by any electric power industry participant; issued by the ERC in accordance with law;

(q) Act on applications for cost recovery and return on demand side
management projects;
(r) In the exercise of its investigative and quasi-judicial powers, act against All notices of hearings to be conducted by the ERC for the purpose of fixing
any participant or player in the energy sector for violations of any law, rule rates or fees shall be published at least twice for two successive weeks in two
and regulation governing the same, including the rules on cross ownership, (2) newspapers of nationwide circulation.
anticompetitive practices, abuse of market positions and similar or related
acts by any participant in the energy sector, or by any person as may be
provided by law, and require any person or entity to submit any report or
Aside from Section 43, additional functions of the ERC are scattered
data relative to any investigation or hearing conducted pursuant to this Act;
throughout RA 9136:
(s) Inspect, on its own or through duly authorized representatives, the
premises, books of accounts and records of any person or entity at any time,
in the exercise of its quasi-judicial power for purposes of determining the 1. SEC. 6. Generation Sector. ― Generation of electric power, a business
existence of any anticompetitive behavior and/or market power abuse and affected with public interest, shall be competitive and open.
any violation of rules and regulations issued by the ERC;
Upon the effectivity of this Act, any new generation company shall, before it
(t) Perform such other regulatory functions as are appropriate and necessary operates, secure from the Energy Regulatory Commission (ERC) a certificate
in order to ensure the successful restructuring and modernization of the of compliance pursuant to the standards set forth in this Act, as well as
electric power industry, such as, but not limited to, the rules and guidelines health, safety and environmental clearances from the appropriate government
under which generation companies, distribution utilities which are not publicly agencies under existing laws.
listed shall offer and sell to the public a portion not less than fifteen percent
(15%) of their common shares of stocks: Provided, however, That generation xxxx
companies, distribution utilities or their respective holding companies that are
2. SEC. 8. Creation of the National Transmission Company. ― x x x
already listed in the PSE are deemed in compliance. For existing companies,
such public offering shall be implemented not later than five (5) years from That the subtransmission assets shall be operated and maintained by
the effectivity of this Act. New companies shall implement their respective TRANSCO until their disposal to qualified distribution utilities which are in a
public offerings not later than five (5) years from the issuance of their position to take over the responsibility for operating, maintaining, upgrading,
certificate of compliance; and and expanding said assets. x x x
(u) The ERC shall have the original and exclusive jurisdiction over all cases In case of disagreement in valuation, procedures, ownership participation and
contesting rates, fees, fines and penalties imposed by the ERC in the exercise other issues, the ERC shall resolve such issues.
of the abovementioned powers, functions and responsibilities and over all
cases involving disputes between and among participants or players in the xxxx
energy sector.
3. SEC. 23. Functions of Distribution Utilities. ― x x x
Distribution utilities shall submit to the ERC a statement of their compliance 5. SEC. 29. Supply Sector. ― x x x all suppliers of electricity to the
with the technical specifications prescribed in the Distribution Code and the contestable market shall require a license from the ERC.
performance standards prescribed in the IRR of this Act. Distribution utilities
which do not comply with any of the prescribed technical specifications and For this purpose, the ERC shall promulgate rules and regulations prescribing
performance standards shall submit to the ERC a plan to comply, within three the qualifications of electricity suppliers which shall include, among other
(3) years, with said prescribed technical specifications and performance requirements, a demonstration of their technical capability, financial
standards. The ERC shall, within sixty (60) days upon receipt of such plan, capability, and creditworthiness: Provided, That the ERC shall have authority
evaluate the same and notify the distribution utility concerned of its action. to require electricity suppliers to furnish a bond or other evidence of the
Failure to submit a feasible and credible plan and/or failure to implement the ability of a supplier to withstand market disturbances or other events that
same shall serve as grounds for the imposition of appropriate sanctions, fines may increase the cost of providing service.
or penalties.
xxxx
xxxx
6. SEC. 30. Wholesale Electricity Spot Market. ― x x x
4. SEC. 28. De-monopolization and Shareholding Dispersal. ― In
Subject to the compliance with the membership criteria, all generating
compliance with the constitutional mandate for dispersal of ownership and de-
companies, distribution utilities, suppliers, bulk consumers/end-users and
monopolization of public utilities, the holdings of persons, natural or juridical,
other similar entities authorized by the ERC shall be eligible to become
including directors, officers, stockholders and related interests, in a
members of the wholesale electricity spot market.
distribution utility and their respective holding companies shall not exceed
twenty-five (25%) percent of the voting shares of stock unless the utility or The ERC may authorize other similar entities to become eligible as members,
the company holding the shares or its controlling stockholders are already either directly or indirectly, of the wholesale electricity spot market.
listed in the Philippine Stock Exchange (PSE): Provided, That controlling
stockholders of small distribution utilities are hereby required to list in the xxxx
PSE within five (5) years from the enactment of this Act if they already own
7. SEC. 31. Retail Competition and Open Access. ― x x x
the stocks. New controlling stockholders shall undertake such listing within
five (5) years from the time they acquire ownership and control. A small Upon the initial implementation of open access, the ERC shall allow all
distribution company is one whose peak demand is equal to Ten megawatts electricity end-users with a monthly average peak demand of at least one
(10MW). megawatt (1MW) for the preceding twelve (12) months to be the contestable
market. xxx Subsequently and every year thereafter, the ERC shall evaluate
The ERC shall, within sixty (60) days from the effectivity of this Act,
the performance of the market. x x x
promulgate the rules and regulations to implement and effect this provision.
8. SEC. 32. NPC Stranded Debt and Contract Cost Recovery. ― x x x
xxxx
The ERC shall verify the reasonable amounts and determine the manner and or market manipulation, or other unfair trade practices detrimental to the
duration for the full recovery of stranded debt and stranded contract costs as encouragement and protection of contestable markets.
defined herein x x x x
xxxx
9. SEC. 34. Universal Charge. ― Within one (1) year from the effectivity of
this Act, a universal charge to be determined, fixed and approved by the ERC, (c) x x x The ERC shall, within one (1) year from the effectivity of this Act,
shall be imposed on all electricity end-users x x x x promulgate rules and regulations to promote competition, encourage market
development and customer choice and discourage/penalize abuse of market
10. SEC. 35. Royalties, Returns and Tax Rates for Indigenous Energy power, cartelization and any anticompetitive or discriminatory behavior, in
Resources. ― x x x order to further the intent of this Act and protect the public interest. Such
rules and regulations shall define the following:
To ensure lower rates for end-users, the ERC shall forthwith reduce the rates
of power from all indigenous sources of energy. (a) the relevant markets for purposes of establishing abuse or misuse of
monopoly or market position;
11. SEC. 36. Unbundling of Rates and Functions. ― x x x
(b) areas of isolated grids; and
each distribution utility shall file its revised rates for the approval by the
ERC. x x x x (c) the periodic reportorial requirements of electric power industry
participants as may be necessary to enforce the provisions of this Section.
12. SEC. 40. Enhancement of Technical Competence. ― The ERC shall
establish rigorous training programs for its staff for the purpose of enhancing The ERC shall, motu proprio, monitor and penalize any market power abuse
the technical competence of the ERC in the following areas: evaluation of or anticompetitive or discriminatory act or behavior by any participant in the
technical performance and monitoring of compliance with service and electric power industry.
performance standards, performance-based rate-setting reform,
environmental standards and such other areas as will enable the ERC to 15. SEC. 51. Powers. ― The PSALM Corp. shall, in the performance of its
adequately perform its duties and functions. functions and for the attainment of its objective, have the following powers:
xxx
13. SEC. 41. Promotion of Consumer Interests. ― The ERC shall handle
consumer complaints and ensure the adequate promotion of consumer (e) To liquidate the NPC stranded contract costs utilizing proceeds from sales
interests. and other property contributed to it, including the proceeds from the universal
charge;
14. SEC. 45. Cross Ownership, Market Power Abuse and Anti-Competitive
Behavior. ― No participant in the electricity industry may engage in any anti- xxxx
competitive behavior including, but not limited to, cross-subsidization, price
16. SEC. 60. Debts of Electric Cooperatives. ― x x x The ERC shall ensure a
reduction in the rates of electric cooperatives commensurate with the
resulting savings due to the removal of the amortization payments of their and NPC, including but not limited to the Palimpinon, Tongonan and
loans. x x x x Mt. Apo Geothermal complexes, shall be reviewed by the ERC and the terms
thereof amended to remove any hidden costs or extraordinary mark-ups in
17. SEC. 62. Joint Congressional Power Commission. ― x x x the cost of power or steam above their true costs. All amended contracts shall
be submitted to the Joint Congressional Power Commission for approval. The
x x x the Power Commission is hereby empowered to require the DOE, ERC,
ERC shall ensure that all savings realized from the reduction of said mark-ups
NEA, TRANSCO, generation companies, distribution utilities, suppliers and
shall be passed on to all end-users.
other electric power industry participants to submit reports and all pertinent
data and information relating to the performance of their respective functions
in the industry. xxx
After comparing the functions of the ERB and the ERC, we find that the ERC
xxxx indeed assumed the functions of the ERB. However, the overlap in the
functions of the ERB and of the ERC does not mean that there is no valid
18. SEC. 65. Environmental Protection. ― Participants in the generation,
abolition of the ERB. The ERC has new and expanded functions which are
distribution and transmission sub-sectors of the industry shall comply with all
intended to meet the specific needs of a deregulated power
environmental laws, rules, regulations and standards promulgated by the
industry. Indeed, National Land Titles and Deeds Registration Administration
Department of Environment and Natural Resources including, in appropriate
v. Civil Service Commission stated that:
cases, the establishment of an environmental guarantee fund.

[I]f the newly created office has substantially new, different or additional
19. SEC. 67. NPC Offer of Transition Supply Contracts. ― Within six (6)
functions, duties or powers, so that it may be said in fact to create an office
months from the effectivity of this Act, NPC shall file with the ERC for its
different from the one abolished, even though it embraces all or some of the
approval a transition supply contract duly negotiated with the distribution
duties of the old office it will be considered as an abolition of one office and
utilities containing the terms and conditions of supply and a corresponding
the creation of a new or different one. The same is true if one office is
schedule of rates, consistent with the provisions hereof, including
abolished and its duties, for reasons of economy are given to an existing
adjustments and/or indexation formulas which shall apply to the term of such
officer or office.[13]
contracts.

xxxx

20. SEC. 69. Renegotiation of Power Purchase and Energy Conversion


Agreements between Government Entities. ― Within three (3) months from KERB argues that RA 9136 did not abolish the ERB nor did it alter its essential
the effectivity of this Act, all power purchase and energy conversion character as an economic regulator of the electric power industry. x x x RA
agreements between the PNOC-Energy Development Corporation (PNOC-EDC) 9136 rather changed merely ERBs name and title to that of the ERC even as it
expanded its functions and objectives to keep pace with the times. To October 6, 1977 ― the government created the Department of Energy
uphold KERBs argument regarding the invalidity of the ERBs abolition is to (DOE) and consequently abolished the OIC, which was replaced by the
ignore the developments in the history of energy regulation. creation of the Board of Energy (BOE) through Presidential Decree No. 1206.
The BOE, in addition, assumed the powers and functions of the BOPW over
the electric power industry.

The regulation of public services started way back in 1902 with the enactment May 8, 1987 ― the BOE was reconstituted into the Energy Regulatory
of Act No. 520 which created the Coastwise Rate Commission. In 1906, Act Board (ERB), pursuant to Executive Order No. 172 issued by then President
No. 1507 was passed creating the Supervising Railway Expert. The following Corazon C. Aquino as part of her governments reorganization program. The
year, Act No. 1779 was enacted creating the Board of Rate Regulation. Then, rationale was to consolidate and entrust into a single body all the regulatory
Act No 2307, which was patterned after the Public Service Law of the State of and adjudicatory functions pertaining to the energy sector. Thus, the power to
New Jersey, was approved by the Philippine Commission in 1914, creating the regulate the power rates and services of private electric utilities was
Board of Public Utility Commissioners, composed of three members, which transferred to the ERB.
absorbed all the functions of the Coastwise Rate Commission, the Supervising
Railway Expert, and the Board of Rate Regulation. December 28, 1992 ― Republic Act No. 7638 signed, where the power
to fix the rates of the National Power Corporation (NPC) and the rural electric
Thereafter, several laws were enacted on public utility regulation. cooperatives (RECs) was passed on to the ERB. Non-pricing functions of the
On November 7, 1936, Commonwealth Act No. 146, otherwise known as the ERB with respect to the petroleum industry were transferred to the DOE, i.e.,
Public Service Law, was enacted by the National Assembly. The Public Service regulating the capacities of new refineries.
Commission (PSC) had jurisdiction, supervision, and control over all public
services, including the electric power service. February 10, 1998 ― enactment of Republic Act 8479: Downstream Oil
Industry Deregulation Act of 1998, which prescribed a five-month transition
After almost four decades, significant developments in the energy sector period, before full deregulation of the oil industry, during which ERB would
changed the landscape of economic regulation in the country. implement an automatic pricing mechanism (APM) for petroleum products
every month.
April 30, 1971 ― R.A. No. 6173 was passed creating the Oil Industry
Commission (OIC), which was tasked to regulate the oil industry and to June 12, 1998 ― the Philippine oil industry was fully deregulated,
ensure the adequate supply of petroleum products at reasonable prices. thus, ERBs focus of responsibility centered on the electric industry.

September 24, 1972 ― then President Ferdinand E. Marcos issued June 8, 2001 ― enactment of Republic Act No. 9136, otherwise known
Presidential Decree No. 1 which ordered the preparation of the Integrated as the Electric Power Industry Reform Act (EPIRA) of 2001. The Act abolished
Reorganization Plan by the Commission on Reorganization. The Plan abolished the ERB and created in its place the Energy Regulatory Commission (ERC)
the PSC and transferred the regulatory and adjudicatory functions pertaining which is a purely independent regulatory body performing the combined
to the electricity industry and water resources to then Board of Power and quasi-judicial, quasi-legislative and administrative functions in the electric
Waterworks (BOPW). industry.[14]
WHEREFORE, we DISMISS the petition. No costs.

Throughout the years, the scope of the regulation has gradually narrowed
from that of public services in 1902 to the electricity industry and water
resources in 1972 to the electric power industry and oil industry in 1977 to SO ORDERED.
the electric industry alone in 1998. The ERC retains the ERBs traditional rate
and service regulation functions. However, the ERC now also has to promote
competitive operations in the electricity market. RA 9136 expanded
the ERCs concerns to encompass both the consumers and the utility
investors.

Thus, the EPIRA provides a framework for the restructuring of the industry,
including the privatization of the assets of the National Power Corporation
(NPC), the transition to a competitive structure, and the delineation of the
roles of various government agencies and the private entities. The law ordains
the division of the industry into four (4) distinct sectors, namely: generation,
transmission, distribution and supply. Corollarily, the NPC generating plants
have to privatized and its transmission business spun off and privatized
thereafter.

In tandem with the restructuring of the industry is the establishment of a


strong and purely independent regulatory body. Thus, the law created the
ERC in place of the Energy Regulatory Board (ERB).

To achieve its aforestated goal, the law has reconfigured the organization of
the regulatory body. x x x[15]

There is no question in our minds that, because of the expansion of


the ERCs functions and concerns, there was a valid abolition of the ERB. Thus,
there is no merit to KERBsallegation that there is an impairment of the
security of tenure of the ERBs employees.
SECOND DIVISION 1. Organizational Structure. Any provision of law to the contrary
notwithstanding and within the limits of their respective appropriations as
[G.R. No. 155336. November 25, 2004] authorized in this Act, the Constitutional Commissions and Offices enjoying
fiscal autonomy are authorized to formulate and implement the organizational
COMMISSION ON HUMAN RIGHTS EMPLOYEES ASSOCIATION (CHREA)
structures of their respective offices, to fix and determine the salaries,
Represented by its President, MARCIAL A. SANCHEZ, JR., petitioner,
allowances, and other benefits of their personnel, and whenever public
vs. COMMISSION ON HUMAN RIGHTS, respondent.
interest so requires, make adjustments in their personal services itemization
DECISION including, but not limited to, the transfer of item or creation of new positions
in their respective offices: PROVIDED, That officers and employees whose
CHICO-NAZARIO, J.: positions are affected by such reorganization or adjustments shall be granted
retirement gratuities and separation pay in accordance with existing laws,
Can the Commission on Human Rights lawfully implement an upgrading and
which shall be payable from any unexpended balance of, or savings in the
reclassification of personnel positions without the prior approval of the
appropriations of their respective offices: PROVIDED, FURTHER, That the
Department of Budget and Management?
implementation hereof shall be in accordance with salary rates, allowances
Before this Court is a petition for review filed by petitioner Commission on and other benefits authorized under compensation standardization laws.
Human Rights Employees Association (CHREA) challenging the
2. Use of Savings. The Constitutional Commissions and Offices enjoying fiscal
Decision[1] dated 29 November 2001 of the Court of Appeals in CA-G.R. SP
autonomy are hereby authorized to use savings in their respective
No. 59678 affirming the Resolutions[2] dated 16 December 1999 and 09 June
appropriations for: (a) printing and/or publication of decisions, resolutions,
2000 of the Civil Service Commission (CSC), which sustained the validity of
and training information materials; (b) repair, maintenance and improvement
the upgrading and reclassification of certain personnel positions in the
of central and regional offices, facilities and equipment; (c) purchase of
Commission on Human Rights (CHR) despite the disapproval thereof by the
books, journals, periodicals and equipment; (d) necessary expenses for the
Department of Budget and Management (DBM). Also assailed is the resolution
employment of temporary, contractual and casual employees; (e) payment of
dated 11 September 2002 of the Court of Appeals denying the motion for
extraordinary and miscellaneous expenses, commutable representation and
reconsideration filed by petitioner.
transportation allowances, and fringe benefits for their officials and
The antecedent facts which spawned the present controversy are as follows: employees as may be authorized by law; and (f) other official purposes,
subject to accounting and auditing rules and regulations.(Emphases supplied)
On 14 February 1998, Congress passed Republic Act No. 8522, otherwise
known as the General Appropriations Act of 1998. It provided for Special On the strength of these special provisions, the CHR, through its then
Provisions Applicable to All Constitutional Offices Enjoying Fiscal Autonomy. Chairperson Aurora P. Navarette-Recia and Commissioners Nasser A.
The last portion of Article XXXIII covers the appropriations of the CHR. These Marohomsalic, Mercedes V. Contreras, Vicente P. Sibulo, and Jorge R. Coquia,
special provisions state: promulgated Resolution No. A98-047 on 04 September 1998, adopting an
upgrading and reclassification scheme among selected positions in the
Commission, to wit:
WHEREAS, the General Appropriations Act, FY 1998, R.A. No. 8522 has On 19 October 1998, CHR issued Resolution No. A98-055[5] providing for the
provided special provisions applicable to all Constitutional Offices enjoying upgrading or raising of salary grades of the following positions in the
Fiscal Autonomy, particularly on organizational structures and authorizes the Commission:
same to formulate and implement the organizational structures of their
respective offices to fix and determine the salaries, allowances and other Number of Position Salary Grade Total Salary
benefits of their personnel and whenever public interest so requires, make Positions Requirements
Title
adjustments in the personnel services itemization including, but not limited
to, the transfer of item or creation of new positions in their respective offices: From To From To
PROVIDED, That officers and employees whose positions are affected by such
reorganization or adjustments shall be granted retirement gratuities and 12 Attorney VI Director IV 26 28 P229,104.00
separation pay in accordance with existing laws, which shall be payable from (In the
any unexpanded balance of, or savings in the appropriations of their Regional Field
respective offices; Offices)

WHEREAS, the Commission on Human Rights is a member of the 4 Director III Director IV 27 28 38,928.00
Constitutional Fiscal Autonomy Group (CFAG) and on July 24, 1998, CFAG
1 Financial & Director IV 24 28 36,744.00
passed an approved Joint Resolution No. 49 adopting internal rules
Management
implementing the special provisions heretoforth mentioned;
Officer II
NOW THEREFORE, the Commission by virtue of its fiscal autonomy hereby
1 Budget Officer Budget 18 24 51,756.00
approves and authorizes the upgrading and augmentation of the
III Officer IV
commensurate amount generated from savings under Personal Services to
support the implementation of this resolution effective Calendar Year 1998; 1 Accountant III Chief 18 24 51,756.00
Accountant
Let the Human Resources Development Division (HRDD) prepare the
necessary Notice of Salary Adjustment and other appropriate documents to 1 Cashier III Cashier V 18 24 51,756.00
implement this resolution; . . . .[3] (Emphasis supplied)
1 Information Director IV 24 28 36,744.00[6]
Annexed to said resolution is the proposed creation of ten Officer V
additional plantilla positions, namely: one Director IV position, with Salary
It, likewise, provided for the creation and upgrading of the following
Grade 28 for the Caraga Regional Office, four Security Officer II with Salary
positions:
Grade 15, and five Process Servers, with Salary Grade 5 under the Office of
the Commissioners. [4] A. Creation
Number of Position Title Salary Grade Total Salary Based on the evaluations made the request was not favorably considered as it
Positions Requirements effectively involved the elevation of the field units from divisions to services.

4 Security Officer II 15 684,780.00 The present proposal seeks further to upgrade the twelve (12) positions of
(Coterminous) Attorney VI, SG-26 to Director IV, SG-28. This would elevate the field units to
a bureau or regional office, a level even higher than the one previously
B. Upgrading denied.

Number of Position Title Salary Grade Total SalaryThe request to upgrade the three (3) positions of Director III, SG-27 to
Positions RequirementsDirector IV, SG-28, in the Central Office in effect would elevate the services
to Office and change the context from support to substantive without actual
From To From To
change in functions.
1 Attorney V Director IV 25 28 P28,092.00
In the absence of a specific provision of law which may be used as a legal
2 Security Security 11 15 57,456.00 basis to elevate the level of divisions to a bureau or regional office, and the
Officer I Officer II services to offices, we reiterate our previous stand denying the upgrading of
the twelve (12) positions of Attorney VI, SG-26 to Director III, SG-27 or
------------------
Director IV, SG-28, in the Field Operations Office (FOO) and three (3) Director
Total 3 P 85,548.00III, SG-27 to Director IV, SG-28 in the Central Office.

To support the implementation of such scheme, the CHR, in the same As represented, President Ramos then issued a Memorandum to the DBM
resolution, authorized the augmentation of a commensurate amount Secretary dated 10 December 1997, directing the latter to increase the
generated from savings under Personnel Services. number of Plantilla positions in the CHR both Central and Regional Offices to
implement the Philippine Decade Plan on Human Rights Education, the
By virtue of Resolution No. A98-062 dated 17 November 1998, the CHR Philippine Human Rights Plan and Barangay Rights Actions Center in
collapsed the vacant positions in the body to provide additional source of accordance with existing laws. (Emphasis in the original)
funding for said staffing modification. Among the positions collapsed were:
one Attorney III, four Attorney IV, one Chemist III, three Special Investigator Pursuant to Section 78 of the General Provisions of the General
I, one Clerk III, and one Accounting Clerk II.[8] Appropriations Act (GAA) FY 1998, no organizational unit or changes in key
positions shall be authorized unless provided by law or directed by the
The CHR forwarded said staffing modification and upgrading scheme to the President, thus, the creation of a Finance Management Office and a Public
DBM with a request for its approval, but the then DBM secretary Benjamin Affairs Office cannot be given favorable recommendation.
Diokno denied the request on the following justification:
Moreover, as provided under Section 2 of RA No. 6758, otherwise known as
the Compensation Standardization Law, the Department of Budget and
Management is directed to establish and administer a unified compensation WHEREFORE, the request of Ronnie N. Rosero, Hubert V. Ruiz, Flordeliza A.
and position classification system in the government. The Supreme Court Briones, George Q. Dumlao [and], Corazon A. Santos-Tiu, is hereby denied.[10]
ruled in the case of Victorina Cruz vs. Court of Appeals, G.R. No. 119155,
dated January 30, 1996, that this Department has the sole power and CHREA filed a motion for reconsideration, but the CSC-Central Office denied
discretion to administer the compensation and position classification system the same on 09 June 2000.
of the National Government.
Given the cacophony of judgments between the DBM and the CSC, petitioner
Being a member of the fiscal autonomy group does not vest the agency with CHREA elevated the matter to the Court of Appeals. The Court of Appeals
the authority to reclassify, upgrade, and create positions without approval of affirmed the pronouncement of the CSC-Central Office and upheld the validity
the DBM. While the members of the Group are authorized to formulate and of the upgrading, retitling, and reclassification scheme in the CHR on the
implement the organizational structures of their respective offices and justification that such action is within the ambit of CHRs fiscal autonomy.
determine the compensation of their personnel, such authority is not absolute The fallo of the Court of Appeals decision provides:
and must be exercised within the parameters of the Unified Position
IN VIEW OF ALL THE FOREGOING, the instant petition is ordered DISMISSED
Classification and Compensation System established under RA 6758 more
and the questioned Civil Service Commission Resolution No. 99-2800 dated
popularly known as the Compensation Standardization Law. We therefore
December 16, 1999 as well as No. 001354 dated June 9, 2000, are hereby
reiterate our previous stand on the matter.[9] (Emphases supplied)
AFFIRMED. No cost.[11]
In light of the DBMs disapproval of the proposed personnel modification
Unperturbed, petitioner filed this petition in this Court contending that:
scheme, the CSC-National Capital Region Office, through a memorandum
dated 29 March 1999, recommended to the CSC-Central Office that the A.
subject appointments be rejected owing to the DBMs disapproval of
the plantilla reclassification. THE COURT OF APPEALS GRAVELY ERRED WHEN IT HELD THAT UNDER THE
1987 CONSTITUTION, THE COMMISSION ON HUMAN RIGHTS ENJOYS FISCAL
Meanwhile, the officers of petitioner CHREA, in representation of the rank and AUTONOMY.
file employees of the CHR, requested the CSC-Central Office to affirm the
recommendation of the CSC-Regional Office. CHREA stood its ground in B.
saying that the DBM is the only agency with appropriate authority mandated
THE COURT OF APPEALS SERIOUSLY ERRED IN UPHOLDING THE
by law to evaluate and approve matters of reclassification and upgrading, as
CONSTRUCTION OF THE COMMISSION ON HUMAN RIGHTS OF REPUBLIC ACT
well as creation of positions.
NO. 8522 (THE GENERAL APPROPRIATIONS ACT FOR THE FISCAL YEAR 1998)
The CSC-Central Office denied CHREAs request in a Resolution dated 16 DESPITE ITS BEING IN SHARP CONFLICT WITH THE 1987 CONSTITUTION
December 1999, and reversed the recommendation of the CSC-Regional AND THE STATUTE ITSELF.
Office that the upgrading scheme be censured. The decretal portion of which
C.
reads:
THE COURT OF APPEALS SERIOUSLY AND GRAVELY ERRED IN AFFIRMING After a thorough consideration of the arguments of both parties and an
THE VALIDITY OF THE CIVIL SERVICE COMMISSION RESOLUTION NOS. assiduous scrutiny of the records in the case at bar, it is the Courts opinion
992800 AND 001354 AS WELL AS THAT OF THE OPINION OF THE that the present petition is imbued with merit.
DEPARTMENT OF JUSTICE IN STATING THAT THE COMMISSION ON HUMAN
RIGHTS ENJOYS FISCAL AUTONOMY UNDER THE 1987 CONSTITUTION AND On petitioners personality to bring this suit, we held in a multitude of cases
THAT THIS FISCAL AUTONOMY INCLUDES THE ACTION TAKEN BY IT IN that a proper party is one who has sustained or is in immediate danger of
COLLAPSING, UPGRADING AND RECLASSIFICATION OF POSITIONS THEREIN. sustaining an injury as a result of the act complained of.[13] Here, petitioner,
[12] which consists of rank and file employees of respondent CHR, protests that
the upgrading and collapsing of positions benefited only a select few in the
The central question we must answer in order to resolve this case is: Can the upper level positions in the Commission resulting to the demoralization of the
Commission on Human Rights validly implement an upgrading, rank and file employees. This sufficiently meets the injury test. Indeed, the
reclassification, creation, and collapsing of plantilla positions in the CHRs upgrading scheme, if found to be valid, potentially entails eating up the
Commission without the prior approval of the Department of Budget and Commissions savings or that portion of its budgetary pie otherwise allocated
Management? for Personnel Services, from which the benefits of the employees, including
those in the rank and file, are derived.
Petitioner CHREA grouses that the Court of Appeals and the CSC-Central
Office both erred in sanctioning the CHRs alleged blanket authority to Further, the personality of petitioner to file this case was recognized by the
upgrade, reclassify, and create positions inasmuch as the approval of the CSC when it took cognizance of the CHREAs request to affirm the
DBM relative to such scheme is still indispensable. Petitioner bewails that the recommendation of the CSC-National Capital Region Office. CHREAs
CSC and the Court of Appeals erroneously assumed that CHR enjoys fiscal personality to bring the suit was a non-issue in the Court of Appeals when it
autonomy insofar as financial matters are concerned, particularly with regard passed upon the merits of this case. Thus, neither should our hands be tied
to the upgrading and reclassification of positions therein. by this technical concern. Indeed, it is settled jurisprudence that an issue that
was neither raised in the complaint nor in the court below cannot be raised
Respondent CHR sharply retorts that petitioner has no locus for the first time on appeal, as to do so would be offensive to the basic rules
standi considering that there exists no official written record in the of fair play, justice, and due process.[14]
Commission recognizing petitioner as a bona fide organization of its
employees nor is there anything in the records to show that its president, We now delve into the main issue of whether or not the approval by the DBM
Marcial A. Sanchez, Jr., has the authority to sue the CHR. The CHR contends is a condition precedent to the enactment of an upgrading, reclassification,
that it has the authority to cause the upgrading, creation and collapsing of plantilla positions in the CHR.
reclassification, plantilla creation, and collapsing scheme sans the approval of
the DBM because it enjoys fiscal autonomy. Germane to our discussion is Rep. Act No. 6758, An Act Prescribing a Revised
Compensation and Position Classification System in the Government and For
Other Purposes, or the Salary Standardization Law, dated 01 July 1989, which
provides in Sections 2 and 4 thereof that it is the DBM that
shall establish and administer a unified Compensation and Position thereof, as defined above, encompasses the entire gamut of government
Classification System. Thus: offices, sans qualification.

SEC. 2. Statement of Policy. -- It is hereby declared the policy of the State to This power to administer is not purely ministerial in character as erroneously
provide equal pay for substantially equal work and to base differences in pay held by the Court of Appeals. The word to administer means to control or
upon substantive differences in duties and responsibilities, and qualification regulate in behalf of others; to direct or superintend the execution,
requirements of the positions. In determining rates of pay, due regard shall application or conduct of; and to manage or conduct public affairs, as to
be given to, among others, prevailing rates in the private sector for administer the government of the state.[15]
comparable work. For this purpose, the Department of Budget and
Management (DBM) is hereby directed to establish and administer a unified The regulatory power of the DBM on matters of compensation is encrypted
Compensation and Position Classification System, hereinafter referred to as not only in law, but in jurisprudence as well. In the recent case
the System as provided for in Presidential Decree No. 985, as amended, that of Philippine Retirement Authority (PRA) v. Jesusito L. Buag,[16] this Court,
shall be applied for all government entities, as mandated by the speaking through Mr. Justice Reynato Puno, ruled that compensation,
Constitution. (Emphasis supplied.) allowances, and other benefits received by PRA officials and employees
without the requisite approval or authority of the DBM
SEC. 4. Coverage. The Compensation and Position Classification System are unauthorized and irregular. In the words of the Court
herein provided shall apply to all positions, appointive or elective, on full or
part-time basis, now existing or hereafter created in the government, Despite the power granted to the Board of Directors of PRA to establish and
including government-owned or controlled corporations and government fix a compensation and benefits scheme for its employees, the same is
financial institutions. subject to the review of the Department of Budget and Management.
However, in view of the express powers granted to PRA under its charter, the
The term government refers to the Executive, the Legislative and the Judicial extent of the review authority of the Department of Budget and Management
Branches and the Constitutional Commissions and shall include all, but shall is limited. As stated in Intia, the task of the Department of Budget and
not be limited to, departments, bureaus, offices, boards, commissions, courts, Management is simply to review the compensation and benefits plan of the
tribunals, councils, authorities, administrations, centers, institutes, state government agency or entity concerned and determine if the same complies
colleges and universities, local government units, and the armed forces. The with the prescribed policies and guidelines issued in this regard. The role of
term government-owned or controlled corporations and financial institutions the Department of Budget and Management is supervisorial in nature, its
shall include all corporations and financial institutions owned or controlled by main duty being to ascertain that the proposed compensation, benefits and
the National Government, whether such corporations and financial institutions other incentives to be given to PRA officials and employees adhere to the
perform governmental or proprietary functions. (Emphasis supplied.) policies and guidelines issued in accordance with applicable laws.

The disputation of the Court of Appeals that the CHR is exempt from the long In Victorina Cruz v. Court of Appeals,[17] we held that the DBM has the sole
arm of the Salary Standardization Law is flawed considering that the coverage power and discretion to administer the compensation and position
classification system of the national government.
In Intia, Jr. v. Commission on Audit,[18] the Court held that although the Irrefragably, it is within the turf of the DBM Secretary to disallow the
charter[19] of the Philippine Postal Corporation (PPC) grants it the power to fix upgrading, reclassification, and creation of additional plantilla positions in the
the compensation and benefits of its employees and exempts PPC from the CHR based on its finding that such scheme lacks legal justification.
coverage of the rules and regulations of the Compensation and Position
Classification Office, by virtue of Section 6 of P.D. No. 1597, the Notably, the CHR itself recognizes the authority of the DBM to deny or
compensation system established by the PPC is, nonetheless, subject to the approve the proposed reclassification of positions as evidenced by its three
review of the DBM. This Court intoned: letters to the DBM requesting approval thereof. As such, it is now estopped
from now claiming that the nod of approval it has previously sought from the
It should be emphasized that the review by the DBM of any PPC resolution DBM is a superfluity.
affecting the compensation structure of its personnel should not be
interpreted to mean that the DBM can dictate upon the PPC Board of Directors The Court of Appeals incorrectly relied on the pronouncement of the CSC-
and deprive the latter of its discretion on the matter. Rather, the DBMs Central Office that the CHR is a constitutional commission, and as such enjoys
function is merely to ensure that the action taken by the Board of Directors fiscal autonomy.[20]
complies with the requirements of the law, specifically, that PPCs
Palpably, the Court of Appeals Decision was based on the mistaken premise
compensation system conforms as closely as possible with that provided for
that the CHR belongs to the species of constitutional commissions. But, Article
under R.A. No. 6758. (Emphasis supplied.)
IX of the Constitution states in no uncertain terms that only the CSC, the
As measured by the foregoing legal and jurisprudential yardsticks, the Commission on Elections, and the Commission on Audit shall be tagged as
imprimatur of the DBM must first be sought prior to implementation Constitutional Commissions with the appurtenant right to fiscal autonomy.
of any reclassification or upgrading of positions in government. This is Thus:
consonant to the mandate of the DBM under the Revised Administrative Code
Sec. 1. The Constitutional Commissions, which shall be independent, are the
of 1987, Section 3, Chapter 1, Title XVII, to wit:
Civil Service Commission, the Commission on Elections, and the Commission
SEC. 3. Powers and Functions. The Department of Budget and Management on Audit.
shall assist the President in the preparation of a national resources and
Sec. 5. The Commission shall enjoy fiscal autonomy. Their approved annual
expenditures budget, preparation, execution and control of the National
appropriations shall be automatically and regularly released.
Budget, preparation and maintenance of accounting systems essential to the
budgetary process, achievement of more economy and efficiency in the Along the same vein, the Administrative Code, in Chapter 5, Sections 24 and
management of government operations,administration of compensation and 26 of Book II on Distribution of Powers of Government, the constitutional
position classification systems, assessment of organizational effectiveness and commissions shall include only the Civil Service Commission, the Commission
review and evaluation of legislative proposals having budgetary or on Elections, and the Commission on Audit, which are granted independence
organizational implications. (Emphasis supplied.) and fiscal autonomy. In contrast, Chapter 5, Section 29 thereof, is silent on
the grant of similar powers to the other bodies including the CHR. Thus:
SEC. 24. Constitutional Commissions. The Constitutional Commissions, which wisdom and dispatch that their needs require. It recognizes the power and
shall be independent, are the Civil Service Commission, the Commission on authority to levy, assess and collect fees, fix rates of compensation not
Elections, and the Commission on Audit. exceeding the highest rates authorized by law for compensation and pay
plans of the government and allocate and disburse such sums as may be
SEC. 26. Fiscal Autonomy. The Constitutional Commissions shall enjoy fiscal provided by law or prescribed by them in the course of the discharge of their
autonomy. The approved annual appropriations shall be automatically and functions.
regularly released.
...
SEC. 29. Other Bodies. There shall be in accordance with the Constitution, an
Office of the Ombudsman, a Commission on Human Rights, and independent The Judiciary, the Constitutional Commissions, and the Ombudsman must
central monetary authority, and a national police commission. Likewise, as have the independence and flexibility needed in the discharge of their
provided in the Constitution, Congress may establish an independent constitutional duties. The imposition of restrictions and constraints on the
economic and planning agency. (Emphasis ours.) manner the independent constitutional offices allocate and utilize the funds
appropriated for their operations is anathema to fiscal autonomy and violative
From the 1987 Constitution and the Administrative Code, it is abundantly not only of the express mandate of the Constitution but especially as regards
clear that the CHR is not among the class of Constitutional Commissions. As the Supreme Court, of the independence and separation of powers upon
expressed in the oft-repeated maxim expressio unius est exclusio alterius, the which the entire fabric of our constitutional system is based. In the interest of
express mention of one person, thing, act or consequence excludes all comity and cooperation, the Supreme Court, [the] Constitutional
others. Stated otherwise, expressium facit cessare tacitum what is expressed Commissions, and the Ombudsman have so far limited their objections to
puts an end to what is implied.[21] constant reminders. We now agree with the petitioners that this grant of
autonomy should cease to be a meaningless provision. (Emphasis supplied.)
Nor is there any legal basis to support the contention that the CHR enjoys
fiscal autonomy. In essence, fiscal autonomy entails freedom from outside Neither does the fact that the CHR was admitted as a member by the
control and limitations, other than those provided by law. It is the freedom to Constitutional Fiscal Autonomy Group (CFAG) ipso facto clothed it with fiscal
allocate and utilize funds granted by law, in accordance with law, and autonomy. Fiscal autonomy is a constitutional grant, not a tag obtainable by
pursuant to the wisdom and dispatch its needs may require from time to membership.
time.[22] In Blaquera v. Alcala and Bengzon v. Drilon,[23] it is understood that it
is only the Judiciary, the Civil Service Commission, the Commission on Audit, We note with interest that the special provision under Rep. Act No. 8522,
the Commission on Elections, and the Office of the Ombudsman, which enjoy while cited under the heading of the CHR, did not specifically mention CHR as
fiscal autonomy. Thus, in Bengzon,[24] we explained: among those offices to which the special provision to formulate and
implement organizational structures apply, but merely states its coverage to
As envisioned in the Constitution, the fiscal autonomy enjoyed by the include Constitutional Commissions and Offices enjoying fiscal autonomy. In
Judiciary, the Civil Service Commission, the Commission on Audit, the contrast, the Special Provision Applicable to the Judiciary under Article XXVIII
Commission on Elections, and the Office of the Ombudsman contemplates a of the General Appropriations Act of 1998 specifically mentions that such
guarantee of full flexibility to allocate and utilize their resources with the
special provision applies to the judiciary and had categorically authorized the and must be exercised within the parameters of the Unified Position
Chief Justice of the Supreme Court to formulate and implement the Classification and Compensation System established under RA 6758 more
organizational structure of the Judiciary, to wit: popularly known as the Compensation Standardization Law.[25] (Emphasis
supplied.)
1. Organizational Structure. Any provision of law to the contrary
notwithstanding and within the limits of their respective appropriations The most lucid argument against the stand of respondent, however, is the
authorized in this Act, the Chief Justice of the Supreme Court is authorized to provision of Rep. Act No. 8522 that the implementation hereof shall be in
formulate and implement organizational structure of the Judiciary, to fix and accordance with salary rates, allowances and other benefits authorized under
determine the salaries, allowances, and other benefits of their personnel, and compensation standardization laws.[26]
whenever public interest so requires, make adjustments in the personal
services itemization including, but not limited to, the transfer of item or Indeed, the law upon which respondent heavily anchors its case upon has
creation of new positions in the Judiciary; PROVIDED, That officers and expressly provided that any form of adjustment in the organizational
employees whose positions are affected by such reorganization or structure must be within the parameters of the Salary Standardization Law.
adjustments shall be granted retirement gratuities and separation pay in
The Salary Standardization Law has gained impetus in addressing one of the
accordance with existing law, which shall be payable from any unexpended
basic causes of discontent of many civil servants.[27] For this purpose,
balance of, or savings in the appropriations of their respective offices:
Congress has delegated to the DBM the power to administer the Salary
PROVIDED, FURTHER, That the implementation hereof shall be in accordance
Standardization Law and to ensure that the spirit behind it is observed. This
with salary rates, allowances and other benefits authorized under
power is part of the system of checks and balances or system of restraints in
compensation standardization laws. (Emphasis supplied.)
our government. The DBMs exercise of such authority is not in itself an
All told, the CHR, although admittedly a constitutional creation is, arrogation inasmuch as it is pursuant to the paramount law of the land, the
nonetheless, not included in the genus of offices accorded fiscal autonomy by Salary Standardization Law and the Administrative Code.
constitutional or legislative fiat.
In line with its role to breathe life into the policy behind the Salary
Even assuming en arguendo that the CHR enjoys fiscal autonomy, we share Standardization Law of providing equal pay for substantially equal work and
the stance of the DBM that the grant of fiscal autonomy notwithstanding, all to base differences in pay upon substantive differences in duties and
government offices must, all the same, kowtow to the Salary Standardization responsibilities, and qualification requirements of the positions, the DBM, in
Law. We are of the same mind with the DBM on its standpoint, thus- the case under review, made a determination, after a thorough evaluation,
that the reclassification and upgrading scheme proposed by the CHR lacks
Being a member of the fiscal autonomy group does not vest the agency with legal rationalization.
the authority to reclassify, upgrade, and create positions without approval of
the DBM. While the members of the Group are authorized to formulate and The DBM expounded that Section 78 of the general provisions of the General
implement the organizational structures of their respective offices and Appropriations Act FY 1998, which the CHR heavily relies upon to justify its
determine the compensation of their personnel, such authority is not absolute reclassification scheme, explicitly provides that no organizational unit or
changes in key positions shall be authorized unless provided by law or
directed by the President. Here, the DBM discerned that there is no law SO ORDERED.
authorizing the creation of a Finance Management Office and a Public Affairs
Office in the CHR. Anent CHRs proposal to upgrade twelve positions of Puno, Acting C.J., Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.
Attorney VI, SG-26 to Director IV, SG-28, and four positions of Director III,
SG-27 to Director IV, SG-28, in the Central Office, the DBM denied the same
as this would change the context from support to substantive without actual
change in functions.

This view of the DBM, as the laws designated body to implement and
administer a unified compensation system, is beyond cavil. The interpretation
of an administrative government agency, which is tasked to implement a
statute is accorded great respect and ordinarily controls the construction of
the courts. In Energy Regulatory Board v. Court of Appeals,[28] we echoed the
basic rule that the courts will not interfere in matters which are addressed to
the sound discretion of government agencies entrusted with the regulation of
activities coming under the special technical knowledge and training of such
agencies.

To be sure, considering his expertise on matters affecting the nations coffers,


the Secretary of the DBM, as the Presidents alter ego, knows from where he
speaks inasmuch as he has the front seat view of the adverse effects of an
unwarranted upgrading or creation of positions in the CHR in particular and in
the entire government in general.

WHEREFORE, the petition is GRANTED, the Decision dated 29 November


2001 of the Court of Appeals in CA-G.R. SP No. 59678 and its Resolution
dated 11 September 2002 are hereby REVERSED and SET ASIDE. The ruling
dated 29 March 1999 of the Civil Service Commision-National Capital Region
is REINSTATED. The Commission on Human Rights Resolution No. A98-047
dated 04 September 1998, Resolution No. A98-055 dated 19 October 1998
and Resolution No. A98-062 dated 17 November 1998 without the approval of
the Department of Budget and Management are disallowed. No
pronouncement as to costs.
EN BANC Respondents. REYES, JJ.

Promulgated:

ANAK MINDANAO PARTY-LIST G.R. No. 166052


GROUP, as represented by Rep.
Mujiv S. Hataman, andMAMALO Present: August 29, 2007
DESCENDANTS ORGANIZATION, x-------------------------------------------------------------------------------------
INC., as represented by its ---x
Chairman Romy Pardi, PUNO, C.J.,

Petitioners, QUISUMBING,

YNARES-SANTIAGO,
DECISION
SANDOVAL-GUTIERREZ,

CARPIO,

- versus - AUSTRIA-MARTINEZ,
CARPIO MORALES, J.:
CORONA,

CARPIO MORALES,
Petitioners Anak Mindanao Party-List Group (AMIN) and Mamalo Descendants
AZCUNA, Organization, Inc. (MDOI) assail the constitutionality of Executive Order
(E.O.) Nos. 364 and 379, both issued in 2004, via the present Petition for
TINGA,
Certiorari and Prohibition with prayer for injunctive relief.
THE EXECUTIVE CHICO-NAZARIO,

SECRETARY, THE HON. EDUARDO GARCIA,


E.O. No. 364, which President Gloria Macapagal-Arroyo issued on September
R. ERMITA, and THE SECRETARY
VELASCO, JR., 27, 2004, reads:
OF AGRARIAN/LAND REFORM, THE
HON. RENE C. VILLA,
NACHURA, and

EXECUTIVE ORDER NO. 364


TRANSFORMING THE DEPARTMENT OF AGRARIAN REFORM INTO THE WHEREAS, under law and jurisprudence, the President of the Philippines has
DEPARTMENT OF LAND REFORM broad powers to reorganize the offices under her supervision and control;

WHEREAS, one of the five reform packages of the Arroyo administration is NOW[,] THEREFORE[,] I, Gloria Macapagal-Arroyo, by the powers vested in
Social Justice and Basic [N]eeds; me as President of the Republic of the Philippines, do hereby order:

WHEREAS, one of the five anti-poverty measures for social justice is asset SECTION 1. The Department of Agrarian Reform is
reform; hereby transformed into the Department of Land Reform. It shall be
responsible for all land reform in the country, including agrarian reform,
urban land reform, and ancestral domain reform.

WHEREAS, asset reforms covers [sic] agrarian reform, urban land reform, and
ancestral domain reform;
SECTION 2. The PCUP is hereby placed under the supervision and control
of the Department of Land Reform. The Chairman of the PCUP shall be ex-
officio Undersecretary of the Department of Land Reform
WHEREAS, urban land reform is a concern of the Presidential Commission
for Urban Land Reform.
[for] the Urban Poor (PCUP) and ancestral domain reform is a concern of the
National Commission on Indigenous Peoples (NCIP);

SECTION 3. The NCIP is hereby placed under the supervision and control of
the Department of Land Reform. The Chairman of the NCIP shall be ex-officio
WHEREAS, another of the five reform packages of the Arroyo administration is
Undersecretary of the Department of Land Reform for Ancestral Domain
Anti-Corruption and Good Government;
Reform.

WHEREAS, one of the Good Government reforms of the Arroyo administration


SECTION 4. The PCUP and the NCIP shall have access to the services
is rationalizing the bureaucracy by consolidating related functions into one
provided by the Departments Finance, Management and Administrative
department;
Office; Policy, Planning and Legal Affairs Office, Field Operations and Support WHEREAS, pursuant to the Administrative Code of 1987, the President has
Services Office, and all other offices of the Department of Land Reform. the continuing authority to reorganize the administrative structure of the
National Government.

SECTION 5. All previous issuances that conflict with this Executive Order are
hereby repealed or modified accordingly. NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic
of the Philippines, by virtue of the powers vested in me by the Constitution
and existing laws, do hereby order:

SECTION 6. This Executive Order takes effect immediately. (Emphasis and


underscoring supplied)
Section 1. Amending Section 3 of Executive Order No. 364. Section 3 of
Executive Order No. 364, dated September 27, 2004 shall now read as
follows:
E.O. No. 379, which amended E.O. No. 364 a month later or on October 26,
2004, reads:

Section 3. The National Commission on Indigenous Peoples (NCIP) shall


be an attached agency of the Department of Land Reform.
EXECUTIVE ORDER NO. 379

Section 2. Compensation. The Chairperson shall suffer no diminution in rank


AMENDING EXECUTIVE ORDER NO. 364 ENTITLED TRANSFORMING THE
and salary.
DEPARTMENT OF AGRARIAN REFORM INTO THE DEPARTMENT OF LAND
REFORM

Section 3. Repealing Clause. All executive issuances, rules and regulations or


parts thereof which are inconsistent with this Executive Order are hereby
WHEREAS, Republic Act No. 8371 created the National Commission on
revoked, amended or modified accordingly.
Indigenous Peoples;

Section 4. Effectivity. This Executive Order shall take effect


immediately. (Emphasis and underscoring in the original)
The Court is thus left with the sole issue of the legality of placing the
Presidential Commission[3] for the Urban Poor (PCUP) under the supervision
and control of the DAR, and the National Commission on Indigenous Peoples
(NCIP) under the DAR as an attached agency.
Petitioners contend that the two presidential issuances are unconstitutional
for violating:

Before inquiring into the validity of the reorganization, petitioners locus


standi or legal standing, inter alia,[4] becomes a preliminary question.
- THE CONSTITUTIONAL PRINCIPLES OF SEPARATION OF POWERS AND
OF THE RULE OF LAW[;]

- THE CONSTITUTIONAL SCHEME AND POLICIES FOR AGRARIAN The Office of the Solicitor General (OSG), on behalf of respondents, concedes
REFORM, URBAN LAND REFORM, INDIGENOUS PEOPLES RIGHTS AND that AMIN[5] has the requisite legal standing to file this suit as member[6] of
ANCESTRAL DOMAIN[; AND] Congress.

- THE CONSTITUTIONAL RIGHT OF THE PEOPLE AND THEIR


ORGANIZATIONS TO EFFECTIVE AND REASONABLE PARTICIPATION IN
DECISION-MAKING, INCLUDING THROUGH ADEQUATE CONSULTATION[.] [1] Petitioners find it impermissible for the Executive to intrude into the domain
of the Legislature. They posit that an act of the Executive which injures the
institution of Congress causes a derivative but nonetheless substantial injury,
which can be questioned by a member of Congress.[7] They add that to the
extent that the powers of Congress are impaired, so is the power of each
By Resolution of December 6, 2005, this Court gave due course to the Petition member thereof, since his office confers a right to participate in the exercise
and required the submission of memoranda, with which petitioners and of the powers of that institution.[8]
respondents complied on March 24, 2006 and April 11, 2006, respectively.

Indeed, a member of the House of Representatives has standing to maintain


The issue on the transformation of the Department of Agrarian Reform (DAR) inviolate the prerogatives, powers and privileges vested by the Constitution in
into the Department of Land Reform (DLR) became moot and academic, his office.[9]
however, the department having reverted to its former name by virtue of E.O.
No. 456[2] which was issued on August 23, 2005.
The OSG questions, however, the standing of MDOI, a registered peoples fairly traceable to the challenged action, and (3) the injury is likely to be
organization of Teduray and Lambangian tribesfolk of (North) Upi and South redressed by a favorable action.[12]
Upi in the province of Maguindanao.

As co-petitioner, MDOI alleges that it is concerned with the negative impact of


NCIPs becoming an attached agency of the DAR on the processing of An examination of MDOIs nebulous claims of negative impact and probable
ancestral domain claims. It fears that transferring the NCIP to the DAR would setbacks[13] shows that they are too abstract to be considered judicially
affect the processing of ancestral domain claims filed by its members. cognizable. And the line of causation it proffers between the challenged action
and alleged injury is too attenuated.

Locus standi or legal standing has been defined as a personal and substantial
interest in a case such that the party has sustained or will sustain direct Vague propositions that the implementation of the assailed orders will work
injury as a result of the governmental act that is being challenged. The gist of injustice and violate the rights of its members cannot clothe MDOI with the
the question of standing is whether a party alleges such personal stake in the requisite standing. Neither would its status as a peoples organization vest it
outcome of the controversy as to assure that concrete adverseness which with the legal standing to assail the validity of the executive orders. [14]
sharpens the presentation of issues upon which the court depends for
illumination of difficult constitutional questions.[10]
La Bugal-Blaan Tribal Association, Inc. v. Ramos,[15] which MDOI cites in
support of its claim to legal standing, is inapplicable as it is not similarly
It has been held that a party who assails the constitutionality of a statute situated with the therein petitioners who alleged personal and substantial
must have a direct and personal interest. It must show not only that the law injury resulting from the mining activities permitted by the assailed
or any governmental act is invalid, but also that it sustained or is in statute. And so is Cruz v. Secretary of Environment and Natural Resources,
[16]
immediate danger of sustaining some direct injury as a result of its for the indigenous peoples leaders and organizations were not the
enforcement, and not merely that it suffers thereby in some indefinite way. It petitioners therein, who necessarily had to satisfy the locus
must show that it has been or is about to be denied some right or privilege to standi requirement, but were intervenors who sought and were allowed to be
which it is lawfully entitled or that it is about to be subjected to some burdens impleaded, not to assail but to defend the constitutionality of the statute.
or penalties by reason of the statute or act complained of.[11]

Moreover, MDOI raises no issue of transcendental importance to justify a


For a concerned party to be allowed to raise a constitutional question, it must relaxation of the rule on legal standing. To be accorded standing on the
show that (1) it has personally suffered some actual or threatened injury as a ground of transcendental importance, Senate of the Philippines v.
result of the allegedly illegal conduct of the government, (2) the injury is Ermita[17] requires that the following elements must be established: (1) the
public character of the funds or other assets involved in the case, (2) the AMIN contends that since the DAR, PCUP and NCIP were created by statutes,
[20]
presence of a clear case of disregard of a constitutional or statutory they can only be transformed, merged or attached by statutes, not by
prohibition by the public respondent agency or instrumentality of government, mere executive orders.
and (3) the lack of any other party with a more direct and specific interest in
raising the questions being raised. The presence of these elements MDOI
failed to establish, much less allege.
While AMIN concedes that the executive power is vested in the
President[21] who, as Chief Executive, holds the power of control of all the
executive departments, bureaus, and offices,[22] it posits that this broad power
Francisco, Jr. v. Fernando[18] more specifically declares that the of control including the power to reorganize is qualified and limited, for it
transcendental importance of the issues raised must relate to the merits of cannot be exercised in a manner contrary to law, citing the constitutional
the petition. duty[23] of the President to ensure that the laws, including those creating the
agencies, be faithfully executed.

This Court, not being a venue for the ventilation of generalized grievances,
must thus deny adjudication of the matters raised by MDOI. AMIN cites the naming of the PCUP as a presidential commission to be clearly
an extension of the President, and the creation of the NCIP as an independent
agency under the Office of the President.[24] It thus argues that since the
legislature had seen fit to create these agencies at separate times and with
Now, on AMINs position. AMIN charges the Executive Department with
distinct mandates, the President should respect that legislative disposition.
transgression of the principle of separation of powers.

In fine, AMIN contends that any reorganization of these administrative


Under the principle of separation of powers, Congress, the President, and the
agencies should be the subject of a statute.
Judiciary may not encroach on fields allocated to each of them. The
legislature is generally limited to the enactment of laws, the executive to the
enforcement of laws, and the judiciary to their interpretation and application
to cases and controversies. The principle presupposes mutual respect by and AMINs position fails to impress.
between the executive, legislative and judicial departments of the
government and calls for them to be left alone to discharge their duties as
they see fit.[19]
The Constitution confers, by express provision, the power of control over
executive departments, bureaus and offices in the President alone. And it lays
down a limitation on the legislative power.
The line that delineates the Legislative and Executive power is not
indistinct. Legislative power is the authority, under the Constitution, to make
laws, and to alter and repeal them. The Constitution, as the will of the people The Constitutions express grant of the power of control in the President
in their original, sovereign and unlimited capacity, has vested this power in justifies an executive action to carry out reorganization measures under a
the Congress of the Philippines. The grant of legislative power to Congress is broad authority of law.[26]
broad, general and comprehensive. The legislative body possesses plenary
power for all purposes of civil government. Any power, deemed to be
legislative by usage and tradition, is necessarily possessed by In enacting a statute, the legislature is presumed to have deliberated with full
Congress, unless the Constitution has lodged it elsewhere. In fine, except as knowledge of all existing laws and jurisprudence on the subject.[27] It is thus
limited by the Constitution, either expressly or impliedly, legislative power reasonable to conclude that in passing a statute which places an agency
embraces all subjects and extends to matters of general concern or common under the Office of the President, it was in accordance with existing laws and
interest. jurisprudence on the Presidents power to reorganize.

While Congress is vested with the power to enact laws, the President executes In establishing an executive department, bureau or office, the legislature
the laws. The executive power is vested in the President. It is generally necessarily ordains an executive agencys position in the scheme of
defined as the power to enforce and administer the laws. It is the power of administrative structure. Such determination is primary,[28] but subject to the
carrying the laws into practical operation and enforcing their due observance. Presidents continuing authority to reorganize the administrative structure. As
far as bureaus, agencies or offices in the executive department are
concerned, the power of control may justify the President to deactivate the
As head of the Executive Department, the President is the Chief Executive. He functions of a particular office. Or a law may expressly grant the President the
represents the government as a whole and sees to it that all laws are broad authority to carry out reorganization measures.[29] The Administrative
enforced by the officials and employees of his department. He has control Code of 1987 is one such law:[30]
over the executive department, bureaus and offices. This means that he has
the authority to assume directly the functions of the executive department,
bureau and office, or interfere with the discretion of its officials. Corollary to SEC. 30. Functions of Agencies under the Office of the President. Agencies
the power of control, the President also has the duty of supervising and under the Office of the President shall continue to operate and function in
enforcement of laws for the maintenance of general peace and public accordance with their respective charters or laws creating them, except as
order. Thus, he is granted administrative power over bureaus and offices otherwise provided in this Code or by law.
under his control to enable him to discharge his duties effectively.[25] (Italics
omitted, underscoring supplied)
SEC. 31. Continuing Authority of the President to Reorganize his Office. The to meet the exigencies of the service that may call for the exercise of the
President, subject to the policy in the Executive Office and in order to power of control.
achieve simplicity, economy and efficiency, shall have continuing
authority to reorganize the administrative structure of the Office of the
President. For this purpose, he may take any of the following actions:
x x x The law grants the President this power in recognition of the recurring
need of every President to reorganize his office to achieve simplicity,
economy and efficiency. The Office of the President is the nerve center of the
(1) Restructure the internal organization of the Office of the President Proper, Executive Branch. To remain effective and efficient, the Office of the President
including the immediate Offices, the Presidential Special Assistants/Advisers must be capable of being shaped and reshaped by the President in the
System and the Common Staff Support System, by abolishing, consolidating, manner he deems fit to carry out his directives and policies. After all, the
or merging units thereof or transferring functions from one unit to another; Office of the President is the command post of the President. This is the
rationale behind the Presidents continuing authority to reorganize the
(2) Transfer any function under the Office of the President to any other administrative structure of the Office of the President.[32]
Department or Agency as well as transfer functions to the Office of the
President from other Departments and Agencies; and

(3) Transfer any agency under the Office of the President to any other The Office of the President consists of the Office of the President proper and
department or agency as well as transfer agencies to the Office of the the agencies under it.[33] It is not disputed that PCUP and NCIP were formed
President from other departments or agencies.[31](Italics in the original; as agencies under the Office of the President.[34] The Agencies under the
emphasis and underscoring supplied) Office of the President refer to those offices placed under the chairmanship of
the President, those under the supervision and control of the President, those
under the administrative supervision of the Office of the President, those
attached to the Office for policy and program coordination, and those that are
not placed by law or order creating them under any special department. [35]
In carrying out the laws into practical operation, the President is best
equipped to assess whether an executive agency ought to continue operating
in accordance with its charter or the law creating it. This is not to say that the As thus provided by law, the President may transfer any agency under the
legislature is incapable of making a similar assessment and appropriate action Office of the President to any other department or agency, subject to the
within its plenary power. The Administrative Code of 1987 merely underscores policy in the Executive Office and in order to achieve simplicity, economy and
the need to provide the President with suitable solutions to situations on hand efficiency. Gauged against these guidelines,[36] the challenged executive
orders may not be said to have been issued with grave abuse of discretion or Article VII of the Constitution with respect to its performance of
in violation of the rule of law. administrative functions[.][40] (Underscoring supplied)

The references in E.O. 364 to asset reform as an anti-poverty measure for


social justice and to rationalization of the bureaucracy in furtherance of good
government[37]encapsulate a portion of the existing policy in the Executive In transferring the NCIP to the DAR as an attached agency, the President
Office. As averred by the OSG, the President saw it fit to streamline the effectively tempered the exercise of presidential authority and considerably
agencies so as not to hinder the delivery of crucial social reforms.[38] recognized that degree of independence.

The consolidation of functions in E.O. 364 aims to attain the objectives of The Administrative Code of 1987 categorizes administrative relationships into
simplicity, economy and efficiency as gathered from the provision granting (1) supervision and control, (2) administrative supervision, and (3)
PCUP and NCIP access to the range of services provided by the DARs attachment.[41] With respect to the third category, it has been held that an
technical offices and support systems.[39] attached agency has a larger measure of independence from the Department
to which it is attached than one which is under departmental supervision and
control or administrative supervision. This is borne out by the lateral
relationship between the Department and the attached agency. The
The characterization of the NCIP as an independent agency under the Office attachment is merely for policy and program coordination.[42] Indeed, the
of the President does not remove said body from the Presidents control and essential autonomous character of a board is not negated by its attachment
supervision with respect to its performance of administrative functions. So it to a commission.[43]
has been opined:

AMIN argues, however, that there is an anachronism of sorts because there


That Congress did not intend to place the NCIP under the control of the can be no policy and program coordination between conceptually different
President in all instances is evident in the IPRA itself, which provides that the areas of reform. It claims that the new framework subsuming agrarian
decisions of the NCIP in the exercise of its quasi-judicial functions shall be reform, urban land reform and ancestral domain reform is fundamentally
appealable to the Court of Appeals, like those of the National Labor Relations incoherent in view of the widely different contexts.[44] And it posits that it is a
Commission (NLRC) and the Securities and Exchange Commission (SEC). substantive transformation or reorientation that runs contrary to the
Nevertheless, the NCIP, although independent to a certain degree, was placed constitutional scheme and policies.
by Congress under the office of the President and, as such, is still subject to
the Presidents power of control and supervision granted under Section 17,
AMIN goes on to proffer the concept of ordering the law[45] which, so it Secondary aids may be consulted to remove, not to create doubt.[51] AMINs
alleges, can be said of the Constitutions distinct treatment of these three thesis unsettles, more than settles the order of things in construing the
areas, as reflected in separate provisions in different parts of the Constitution. Constitution. Its interpretation fails to clearly establish that the so-called
[46]
It argues that the Constitution did not intend an over-arching concept of ordering or arrangement of provisions in the Constitution was consciously
agrarian reform to encompass the two other areas, and that how the law is adopted to imply a signification in terms of government hierarchy from where
ordered in a certain way should not be undermined by mere executive orders a constitutional mandate can per se be derived or asserted. It fails to
in the guise of administrative efficiency. demonstrate that the ordering or layout was not simply a matter of style in
constitutional drafting but one of intention in government structuring. With its
inherent ambiguity, the proposed interpretation cannot be made a basis for
declaring a law or governmental act unconstitutional.
The Court is not persuaded.

A law has in its favor the presumption of constitutionality. For it to be


nullified, it must be shown that there is a clear and unequivocal breach of the
Constitution. The ground for nullity must be clear and beyond reasonable
doubt.[52] Any reasonable doubt should, following the universal rule of legal
The interplay of various areas of reform in the promotion of social justice is hermeneutics, be resolved in favor of the constitutionality of a law.[53]
not something implausible or unlikely.[47] Their interlocking nature cuts across
labels and works against a rigid pigeonholing of executive tasks among the Ople v. Torres[54] on which AMIN relies is unavailing. In that case, an
members of the Presidents official family. Notably, the Constitution inhibited administrative order involved a system of identification that required a
from identifying and compartmentalizing the composition of the Cabinet. In delicate adjustment of various contending state policies properly lodged in the
vesting executive power in one person rather than in a plural executive, the legislative arena. It was declared unconstitutional for dealing with a subject
evident intention was to invest the power holder with energy.[48] that should be covered by law and for violating the right to privacy.

AMIN takes premium on the severed treatment of these reform areas in In the present case, AMIN glaringly failed to show how the reorganization by
marked provisions of the Constitution. It is a precept, however, that executive fiat would hamper the exercise of citizens rights and privileges. It
inferences drawn from title, chapter or section headings are entitled to very rested on the ambiguous conclusion that the reorganization jeopardizes
little weight.[49] And so must reliance on sub-headings,[50] or the lack thereof, economic, social and cultural rights. It intimated, without expounding, that
to support a strained deduction be given the weight of helium. the agendum behind the issuances is to weaken the indigenous peoples rights
in favor of the mining industry. And it raised concerns about the possible
retrogression in DARs performance as the added workload may impede the
implementation of the comprehensive agrarian reform program.
AMIN has not shown, however, that by placing the NCIP as an attached consult could only be reflected in the ballot box and would not nullify
agency of the DAR, the President altered the nature and dynamics of the government action.[58]
jurisdiction and adjudicatory functions of the NCIP concerning all claims and
disputes involving rights of indigenous cultural communities and

indigenous peoples. Nor has it been shown, nay alleged, that the
reorganization was made in bad faith.[55]
WHEREFORE, the petition is DISMISSED. Executive Order Nos. 364 and
379 issued on September 27, 2004 and October 26, 2004, respectively, are
declared not unconstitutional.
As for the other arguments raised by AMIN which pertain to the wisdom or
soundness of the executive decision, the Court finds it unnecessary to pass
upon them. The raging debate on the most fitting framework in the delivery
of social services is endless in the political arena. It is not the business of this SO ORDERED.
Court to join in the fray. Courts have no judicial power to review cases
involving political questions and, as a rule, will desist from taking cognizance
of speculative or hypothetical cases, advisory opinions and cases that have
become moot.[56]

Finally, a word on the last ground proffered for declaring the


unconstitutionality of the assailed issuances ─ that they violate Section 16,
Article XIII of the Constitution[57] on the peoples right to participate in
decision-making through adequate consultation mechanisms.

The framers of the Constitution recognized that the consultation mechanisms


were already operating without the States action by law, such that the role of
the State would be mere facilitation, not necessarily creation of these
consultation mechanisms. The State provides the support, but eventually it is
the people, properly organized in their associations, who can assert the right
and pursue the objective. Penalty for failure on the part of the government to
FIRST DIVISION the positions in the new OSSP were then disseminated and posted at the
central and provincial offices of the NTA.
[G.R. No. 152845. August 5, 2003]
On 10 June 1996, petitioners, all occupying different positions at the NTA
DRIANITA BAGAOISAN, FELY MADRIAGA, SHIRLY TAGABAN, office in Batac, Ilocos Norte, received individual notices of termination of their
RICARDO SARANDI, SUSAN IMPERIAL, BENJAMIN DEMDEM, RODOLFO employment with the NTA effective thirty (30) days from receipt
DAGA, EDGARDO BACLIG, GREGORIO LABAYAN, HILARIO JEREZ, and thereof. Finding themselves without any immediate relief from their dismissal
MARIA CORAZON CUANANG, petitioners, vs. NATIONAL TOBACCO from the service, petitioners filed a petition for certiorari, prohibition
ADMINISTRATION, represented by ANTONIO DE GUZMAN and and mandamus, with prayer for preliminary mandatory injunction and/or
PERLITA BAULA, respondents. temporary restraining order, with the Regional Trial Court (RTC) of Batac,
Ilocos Norte, and prayed -
DECISION
1) that a restraining order be immediately issued enjoining the respondents
VITUG, J.:
from enforcing the notice of termination addressed individually to the
President Joseph Estrada issued on 30 September 1998 Executive Order No. petitioners and/or from committing further acts of dispossession and/or
29, entitled Mandating the Streamlining of the National Tobacco ousting the petitioners from their respective offices;
Administration (NTA), a government agency under the Department of
2) that a writ of preliminary injunction be issued against the respondents,
Agriculture. The order was followed by another issuance, on 27 October 1998,
commanding them to maintain the status quo to protect the rights of the
by President Estrada of Executive Order No. 36, amending Executive Order
petitioners pending the determination of the validity of the implementation of
No. 29, insofar as the new staffing pattern was concerned, by increasing from
their dismissal from the service; and
four hundred (400) to not exceeding seven hundred fifty (750) the positions
affected thereby. In compliance therewith, the NTA prepared and adopted a 3) that, after trial on the merits, judgment be rendered declaring the notice of
new Organization Structure and Staffing Pattern (OSSP) which, on 29 October termination of the petitioners illegal and the reorganization null and void and
1998, was submitted to the Office of the President. ordering their reinstatement with backwages, if applicable, commanding the
respondents to desist from further terminating their services, and making the
On 11 November 1998, the rank and file employees of NTA Batac, among
injunction permanent.[1]
whom included herein petitioners, filed a letter-appeal with the Civil Service
Commission and sought its assistance in recalling the OSSP. On 04 December The RTC, on 09 September 2000, ordered the NTA to appoint petitioners in
1998, the OSSP was approved by the Department of Budget and Management the new OSSP to positions similar or comparable to their respective former
(DBM) subject to certain revisions. On even date, the NTA created a assignments. A motion for reconsideration filed by the NTA was denied by the
placement committee to assist the appointing authority in the selection and trial court in its order of 28 February 2001. Thereupon, the NTA filed an
placement of permanent personnel in the revised OSSP. The results of the appeal with the Court of Appeals, raising the following issues:
evaluation by the committee on the individual qualifications of applicants to
I. Whether or not respondents submitted evidence as proof that petitioners, IV. The Court of Appeals erred in holding that respondent NTA was not guilty
individually, were not the best qualified and most deserving among the of bad faith in the termination of the services of petitioners; (and)
incumbent applicant-employees.
V. The Court of Appeals erred in ignoring case law/jurisprudence in the
II. Whether or not incumbent permanent employees, including herein abolition of an office.[3]
petitioners, automatically enjoy a preferential right and the right of first
refusal to appointments/reappointments in the new Organization Structure In its resolution of 10 July 2002, the Court required the NTA to file its
And Staffing Pattern (OSSP) of respondent NTA. comment on the petition. On 18 November 2002, after the NTA had filed its
comment of 23 September 2002, the Court issued its resolution denying the
III. Whether or not respondent NTA in implementing the mandated petition for failure of petitioners to sufficiently show any reversible error on
reorganization pursuant to E.O. No. 29, as amended by E.O. No. 36, strictly the part of the appellate court in its challenged decision so as to warrant the
adhere to the implementing rules on reorganization, particularly RA 6656 and exercise by this Court of its discretionary appellate jurisdiction. A motion for
of the Civil Service Commission Rules on Government Reorganization. reconsideration filed by petitioners was denied in the Courts resolution of 20
January 2002.
IV. Whether or not the validity of E.O. Nos. 29 and 36 can be put in issue in
the instant case/appeal.[2] On 21 February 2003, petitioners submitted a Motion to Admit Petition For En
Banc Resolution of the case allegedly to address a basic question, i.e., the
On 20 February 2002, the appellate court rendered a decision reversing and legal and constitutional issue on whether the NTA may be reorganized by an
setting aside the assailed orders of the trial court. executive fiat, not by legislative action.[4] In their Petition for an En
Banc Resolution petitioners would have it that -
Petitioners went to this Court to assail the decision of the Court of Appeals,
contending that - 1. The Court of Appeals decision upholding the reorganization of the National
Tobacco Administration sets a dangerous precedent in that:
I. The Court of Appeals erred in making a finding that went beyond the issues
of the case and which are contrary to those of the trial court and that it a) A mere Executive Order issued by the Office of the President and procured
overlooked certain relevant facts not disputed by the parties and which, if by a government functionary would have the effect of a blanket authority to
properly considered, would justify a different conclusion; reorganize a bureau, office or agency attached to the various executive
departments;
II. The Court of Appeals erred in upholding Executive Order Nos. 29 and 36 of
the Office of the President which are mere administrative issuances which do b) The President of the Philippines would have the plenary power to
not have the force and effect of a law to warrant abolition of positions and/or reorganize the entire government Bureaucracy through the issuance of an
effecting total reorganization; Executive Order, an administrative issuance without the benefit of due
deliberation, debate and discussion of members of both chambers of the
III. The Court of Appeals erred in holding that petitioners removal from the
Congress of the Philippines;
service is in accordance with law;
c) The right to security of tenure to a career position created by law or statute Notwithstanding the apparent procedural lapse on the part of petitioner to
would be defeated by the mere adoption of an Organizational Structure and implead the Office of the President as party respondent pursuant to Section 7,
Staffing Pattern issued pursuant to an Executive Order which is not a law and Rule 3, of the 1997 Revised Rules of Civil Procedure, [6] this Court resolved to
could thus not abolish an office created by law; rule on the merits of the petition.

2. The case law on abolition of an office would be disregarded, ignored and Buklod ng Kawaning EIIB vs. Zamora[7] ruled that the President, based on
abandoned if the Court of Appeals decision subject matter of this Petition existing laws, had the authority to carry out a reorganization in any branch or
would remain undisturbed and untouched. In other words, previous doctrines agency of the executive department. In said case, Buklod ng Kawaning
and precedents of this Highest Court would in effect be reversed and/or EIIB challenged the issuance, and sought the nullification, of Executive Order
modified with the Court of Appeals judgment, should it remain unchallenged. No. 191 (Deactivation of the Economic Intelligence and Investigation Bureau)
and Executive Order No. 223 (Supplementary Executive Order No. 191 on the
3. Section 4 of Executive Order No. 245 dated July 24, 1987 (Annex D, Deactivation of the Economic Intelligence and Investigation Bureau and for
Petition), issued by the Revolutionary government of former President Other Matters) on the ground that they were issued by the President with
Corazon Aquino, and the law creating NTA, which provides that the governing grave abuse of discretion and in violation of their constitutional right to
body of NTA is the Board of Directors, would be rendered meaningless, security of tenure. The Court explained:
ineffective and a dead letter law because the challenged NTA reorganization
which was erroneously upheld by the Court of Appeals was adopted and The general rule has always been that the power to abolish a public office is
implemented by then NTA Administrator Antonio de Guzman without the lodged with the legislature. This proceeds from the legal precept that the
corresponding authority from the Board of Directors as mandated therein. In power to create includes the power to destroy. A public office is either created
brief, the reorganization is an ultra vires act of the NTA Administrator. by the Constitution, by statute, or by authority of law. Thus, except where the
office was created by the Constitution itself, it may be abolished by the same
4. The challenged Executive Order No. 29 issued by former President Joseph legislature that brought it into existence.
Estrada but unsigned by then Executive Secretary Ronaldo Zamora would in
effect be erroneously upheld and given legal effect as to supersede, amend The exception, however, is that as far as bureaus, agencies or offices in the
and/or modify Executive Order No. 245, a law issued during the Freedom executive department are concerned, the Presidents power of control may
Constitution of President Corazon Aquino. In brief, a mere executive order justify him to inactivate the functions of a particular office, or certain laws
would amend, supersede and/or render ineffective a law or statute.[5] may grant him the broad authority to carry out reorganization measures. The
case in point is Larin v. Executive Secretary [280 SCRA 713]. In this case, it
In order to allow the parties a full opportunity to ventilate their views on the was argued that there is no law which empowers the President to reorganize
matter, the Court ultimately resolved to hear the parties in oral the BIR. In decreeing otherwise, this Court sustained the following legal basis,
argument. Essentially, the core question raised by them is whether or not the thus:
President, through the issuance of an executive order, can validly carry out
the reorganization of the NTA. `Initially, it is argued that there is no law yet which empowers the President
to issue E.O. No. 132 or to reorganize the BIR.
`We do not agree. ``Sec. 20. Residual Powers. Unless Congress provides otherwise, the
President shall exercise such other powers and functions vested in the
`x x x x x x President which are provided for under the laws and which are not specifically
enumerated above or which are not delegated by the President in accordance
`Section 48 of R.A. 7645 provides that:
with law.
``Sec. 48. Scaling Down and Phase Out of Activities of Agencies Within the
`This provision speaks of such other powers vested in the President under the
Executive Branch. The heads of departments, bureaus and offices and
law. What law then gives him the power to reorganize? It is Presidential
agencies are hereby directed to identify their respective activities which are
Decree No. 1772 which amended Presidential Decree No. 1416. These
no longer essential in the delivery of public services and which may be scaled
decrees expressly grant the President of the Philippines the continuing
down, phased out or abolished, subject to civil service rules and regulations. x
authority to reorganize the national government, which includes the power to
x x. Actual scaling down, phasing out or abolition of the activities shall be
group, consolidate bureaus and agencies, to abolish offices, to transfer
effected pursuant to Circulars or Orders issued for the purpose by the Office
functions, to create and classify functions, services and activities and to
of the President.
standardize salaries and materials. The validity of these two decrees are
`Said provision clearly mentions the acts of `scaling down, phasing out and unquestionable. The 1987 Constitution clearly provides that `all laws,
abolition of offices only and does not cover the creation of offices or transfer decrees, executive orders, proclamations, letter of instructions and other
of functions. Nevertheless, the act of creating and decentralizing is included in executive issuances not inconsistent with this Constitution shall remain
the subsequent provision of Section 62 which provides that: operative until amended, repealed or revoked. So far, there is yet no law
amending or repealing said decrees.
``Sec. 62. Unauthorized organizational changes. Unless otherwise created by
law or directed by the President of the Philippines, no organizational unit or Now, let us take a look at the assailed executive order.
changes in key positions in any department or agency shall be authorized in
In the whereas clause of E.O. No. 191, former President Estrada anchored his
their respective organization structures and be funded from appropriations by
authority to deactivate EIIB on Section 77 of Republic Act 8745 (FY 1999
this Act.
General Appropriations Act), a provision similar to Section 62 of R.A. 7645
`The foregoing provision evidently shows that the President is authorized to quoted in Larin, thus:
effect organizational changes including the creation of offices in the
`Sec. 77. Organized Changes. Unless otherwise provided by law or directed
department or agency concerned.
by the President of the Philippines, no changes in key positions or
`x x x x x x organizational units in any department or agency shall be authorized in their
respective organizational structures and funded from appropriations provided
`Another legal basis of E.O. No. 132 is Section 20, Book III of E.O. No. 292 by this Act.
which states:
We adhere to the x x x ruling in Larin that this provision recognizes the
authority of the President to effect organizational changes in the department
or agency under the executive structure. Such a ruling further finds support in It having been duly established that the President has the authority to carry
Section 78 of Republic Act No. 8760. Under this law, the heads of out reorganization in any branch or agency of the executive department, what
departments, bureaus, offices and agencies and other entities in the is then left for us to resolve is whether or not the reorganization is valid. In
Executive Branch are directed (a) to conduct a comprehensive review of this this jurisdiction, reorganizations have been regarded as valid provided they
respective mandates, missions, objectives, functions, programs, projects, are pursued in good faith. Reorganization is carried out in `good faith if it is
activities and systems and procedures; (b) identify activities which are no for the purpose of economy or to make bureaucracy more
longer essential in the delivery of public services and which may be scaled efficient. Pertinently, Republic Act No. 6656 provides for the circumstances
down, phased-out or abolished; and (c) adopt measures that will result in the which may be considered as evidence of bad faith in the removal of civil
streamlined organization and improved overall performance of their service employees made as a result of reorganization, to wit: (a) where there
respective agencies. Section 78 ends up with the mandate that the actual is a significant increase in the number of positions in the new staffing pattern
streamlining and productivity improvement in agency organization and of the department or agency concerned; (b) where an office is abolished and
operation shall be effected pursuant to Circulars or Orders issued for the another performing substantially the same functions is created; (c) where
purpose by the Office of the President. The law has spoken clearly. We are incumbents are replaced by those less qualified in terms of status of
left only with the duty to sustain. appointment, performance and merit; (d) where there is a classification of
offices in the department or agency concerned and the reclassified offices
But of course, the list of legal basis authorizing the President to reorganize perform substantially the same functions as the original offices, and (e) where
any department or agency in the executive branch does not have to end the removal violates the order of separation.[8]
here. We must not lose sight of the very source of the power that which
constitutes an express grant of power. Under Section 31, Book III of The Court of Appeals, in its now assailed decision, has found no evidence of
Executive Order No. 292 (otherwise known as the Administrative Code of bad faith on the part of the NTA; thus -
1987), the President, subject to the policy in the Executive Office and in order
to achieve simplicity, economy and efficiency, shall have the continuing In the case at bar, we find no evidence that the respondents committed bad
authority to reorganize the administrative structure of the Office of the faith in issuing the notices of non-appointment to the petitioners.
President. For this purpose, he may transfer the functions of other
Firstly, the number of positions in the new staffing pattern did not
Departments or Agencies to the Office of the President. In Canonizado vs.
increase. Rather, it decreased from 1,125 positions to 750. It is thus natural
Aguirre [323 SCRA 312], we ruled that reorganization involves the reduction
that ones position may be lost through the removal or abolition of an office.
of personnel, consolidation of offices, or abolition thereof by reason of
economy or redundancy of functions. It takes place when there is an Secondly, the petitioners failed to specifically show which offices were
alteration of the existing structure of government offices or units therein, abolished and the new ones that were created performing substantially the
including the lines of control, authority and responsibility between them. The same functions.
EIIB is a bureau attached to the Department of Finance. It falls under the
Office of the President. Hence, it is subject to the Presidents continuing Thirdly, the petitioners likewise failed to prove that less qualified employees
authority to reorganize. were appointed to the positions to which they applied.
x x x x x x x x x. power to reorganize the Office of the President Proper. The Court has there
observed:
Fourthly, the preference stated in Section 4 of R.A. 6656, only means that old
employees should be considered first, but it does not necessarily follow that x x x. Under Section 31(1) of EO 292, the President can reorganize the Office
they should then automatically be appointed. This is because the law does not of the President Proper by abolishing, consolidating or merging units, or by
preclude the infusion of new blood, younger dynamism, or necessary talents transferring functions from one unit to another. In contrast, under Section
into the government service, provided that the acts of the appointing power 31(2) and (3) of EO 292, the Presidents power to reorganize offices outside
are bonafide for the best interest of the public service and the person chosen the Office of the President Proper but still within the Office of the President is
has the needed qualifications.[9] limited to merely transferring functions or agencies from the Office of the
President to Departments or Agencies, and vice versa.
These findings of the appellate court are basically factual which this Court
must respect and be held bound. The provisions of Section 31, Book III, Chapter 10, of Executive Order No.
292 (Administrative Code of 1987), above-referred to, reads thusly:
It is important to emphasize that the questioned Executive Orders No.
29 and No. 36 have not abolished the National Tobacco SEC. 31. Continuing Authority of the President to Reorganize his Office. The
Administration but merely mandated its reorganization through the President, subject to the policy in the Executive Office and in order to achieve
streamlining or reduction of its personnel. Article VII, Section 17,[10] of simplicity, economy and efficiency, shall have continuing authority to
the Constitution, expressly grants the President control of all executive reorganize the administrative structure of the Office of the President. For this
departments, bureaus, agencies and offices which may justify an executive purpose, he may take any of the following actions:
action to inactivate the functions of a particular office or to carry out
reorganization measures under a broad authority of law.[11]Section 78 of the (1) Restructure the internal organization of the Office of the President Proper,
General Provisions of Republic Act No. 8522 (General Appropriations Act of FY including the immediate Offices, the Presidential Special Assistants/Advisers
1998) has decreed that the President may direct changes in the organization System and the Common Staff Support System, by abolishing, consolidating
and key positions in any department, bureau or agency pursuant to Article VI, or merging units thereof or transferring functions from one unit to another;
Section 25,[12] of the Constitution, which grants to the Executive Department
(2) Transfer any function under the Office of the President to any other
the authority to recommend the budget necessary for its operation. Evidently,
Department or Agency as well as transfer functions to the Office of the
this grant of power includes the authority to evaluate each and every
President from other Departments and Agencies; and
government agency, including the determination of the most economical and
efficient staffing pattern, under the Executive Department. (3) Transfer any agency under the Office of the President to any other
department or agency as well as transfer agencies to the Office of the
In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon. Ronaldo D.
President from other departments and agencies.
Zamora, in his capacity as the Executive Secretary, et al.,[13] this Court has
had occasion to also delve on the Presidents power to reorganize the Office of The first sentence of the law is an express grant to the President of
the President under Section 31(2) and (3) of Executive Order No. 292 and the a continuing authority to reorganize the administrative structure of
the Office of the President. The succeeding numbered paragraphs are not SO ORDERED.
in the nature of provisos that unduly limit the aim and scope of the grant to
the President of the power to reorganize but are to be viewed in consonance
therewith. Section 31(1) of Executive Order No. 292 specifically refers to the
Presidents power to restructure the internal organization of the Office of the
President Proper, by abolishing, consolidating or merging units hereof or
transferring functions from one unit to another, while Section 31(2) and (3)
concern executive offices outside the Office of the President Properallowing
the President to transfer any function under the Office of the President to any
other Department or Agency and vice-versa, and the transfer of any agency
under the Office of the President to any other department or agency and vice-
versa.[14]

In the present instance, involving neither an abolition nor transfer of offices,


the assailed action is a mere reorganization under the general provisions of
the law consisting mainly of streamlining the NTA in the interest of
simplicity, economy and efficiency. It is an act well within the authority of
President motivated and carried out, according to the findings of the appellate
court, in good faith, a factual assessment that this Court could only but
accept.[15]

In passing, relative to petitioners Motion for an En Banc Resolution of the


Case, it may be well to remind counsel, that the Court En Banc is not an
appellate tribunal to which appeals from a Division of the Court may be
taken. A Division of the Court is the Supreme Court as fully and veritably as
the Court En Banc itself and a decision of its Division is as authoritative and
final as a decision of the Court En Banc. Referrals of cases from a Division to
the Court En Banc do not take place as just a matter of routine but only on
such specified grounds as the Court in its discretion may allow.[16]

WHEREFORE, the Motion to Admit Petition for En Banc resolution and the
Petition for an En Banc Resolution are DENIED for lack of merit. Let entry of
judgment be made in due course. No costs.
Republic of the Philippines (NALTDRA), reveals that said law in express terms, provided for the abolition
SUPREME COURT of existing positions. Thus, without need of any interpretation, the law
Manila mandates that from the moment an implementing order is issued, all
positions in the Land Registration Commission are deemed non-existent. This,
EN BANC however, does not mean removal. Abolition of a position does not involve or
mean removal for the reason that removal implies that the post subsists and
that one is merely separated therefrom. (Arao vs. Luspo, 20 SCRA 722
[1967]) After abolition, there is in law no occupant. Thus, there can be no
tenure to speak of. It is in this sense that from the standpoint of strict law,
G.R. No. 84301. April 7, 1993. the question of any impairment of security of tenure does not arise. (De la
Llana vs. Alba, 112 SCRA 294 [1982])
NATIONAL LAND TITLES AND DEEDS REGISTRATION ADMINISTRATION,
petitioner, 2. ID.; ID.; ID.; REORGANIZATION, VALID WHEN PURSUED IN GOOD FAITH;
vs. CASE AT BAR. — Nothing is better settled in our law than that the abolition of
CIVIL SERVICE COMMISSION and VIOLETA L. GARCIA, respondents. an office within the competence of a legitimate body if done in good faith
suffers from no infirmity. Two questions therefore arise: (1) was the abolition
The Solicitor General for petitioner. carried out by a legitimate body?; and (2) was it done in good faith? There is
no dispute over the authority to carry out a valid reorganization in any branch
Raul R. Estrella for private respondent. or agency of the Government. Under Section 9, Article XVII of the 1973
Constitution. The power to reorganize is, however; not absolute. We have
SYLLABUS
held in Dario vs. Mison that reorganizations in this jurisdiction have been
1. ADMINISTRATIVE LAW; EXECUTIVE ORDER NO. 649; REORGANIZED LAND regarded as valid provided they are pursued in good faith. This court has
REGISTRATION COMMISSION TO NALTDRA; EXPRESSLY PROVIDED THE pronounced that if the newly created office has substantially new, different or
ABOLITION OF EXISTING POSITIONS. — Executive Order No. 649 authorized additional functions, duties or powers, so that it may be said in fact to create
the reorganization of the Land Registration Commission (LRC) into the an office different from the one abolished, even though it embraces all or
National Land Titles and Deeds Registration Administration (NALTDRA). It some of the duties of the old office it will be considered as an abolition of one
abolished all the positions in the now defunct LRC and required new office and the creation of a new or different one. The same is true if one office
appointments to be issued to all employees of the NALTDRA. The question of is abolished and its duties, for reasons of economy are given to an existing
whether or not a law abolishes an office is one of legislative intent about officer or office. Executive Order No. 649 was enacted to improve the services
which there can be no controversy whatsoever if there is an explicit and better systematize the operation of the Land Registration Commission. A
declaration in the law itself. A closer examination of Executive Order No. 649 reorganization is carried out in good faith if it is for the purpose of economy
which authorized the reorganization of the Land Registration Commission or to make bureaucracy more efficient. To this end, the requirement of Bar
(LRC) into the National Land Titles and Deeds Registration Administration membership to qualify for key positions in the NALTDRA was imposed to meet
the changing circumstances and new development of the times. Private The facts, as succinctly stated in the Resolution ** of the Civil Service
respondent Garcia who formerly held the position of Deputy Register of Deeds Commission, are as follows:
II did not have such qualification. It is thus clear that she cannot hold any key
position in the NALTDRA, The additional qualification was not intended to "The records show that in 1977, petitioner Garcia, a Bachelor of Laws
remove her from office. Rather, it was a criterion imposed concomitant with a graduate and a first grade civil service eligible was appointed Deputy Register
valid reorganization measure. of Deeds VII under permanent status. Said position was later reclassified to
Deputy Register of Deeds III pursuant to PD 1529, to which position,
3. ID.; ID.; ID.; THERE IS NO VESTED PROPERTY RIGHT TO BE RE- petitioner was also appointed under permanent status up to September 1984.
EMPLOYED IN A REORGANIZED OFFICE; CASE AT BAR. — There is no such She was for two years, more or less, designated as Acting Branch Register of
thing as a vested interest or an estate in an office, or even an absolute right Deeds of Meycauayan, Bulacan. By virtue of Executive Order No. 649 (which
to hold it. Except constitutional offices which provide for special immunity as took effect on February 9, 1981) which authorized the restructuring of the
regards salary and tenure, no one can be said to have any vested right in an Land Registration Commission to National Land Titles and Deeds Registration
office or its salary. None of the exceptions to this rule are obtaining in this Administration and regionalizing the Offices of the Registers therein,
case. To reiterate, the position which private respondent Garcia would like to petitioner Garcia was issued an appointment as Deputy Register of Deeds II
occupy anew was abolished pursuant to Executive Order No. 649, a valid on October 1, 1984, under temporary status, for not being a member of the
reorganization measure. There is no vested property right to be re employed Philippine Bar. She appealed to the Secretary of Justice but her request was
in a reorganized office. Not being a member of the Bar, the minimum denied. Petitioner Garcia moved for reconsideration but her motion remained
requirement to qualify under the reorganization law for permanent unacted. On October 23, 1984, petitioner Garcia was administratively charged
appointment as Deputy Register of Deeds II, she cannot be reinstated to her with Conduct Prejudicial to the Best Interest of the Service. While said case
former position without violating the express mandate of the law. was pending decision, her temporary appointment as such was renewed in
1985. In a Memorandum dated October 30, 1986, the then Minister, now
DECISION Secretary, of Justice notified petitioner Garcia of the termination of her
services as Deputy Register of Deeds II on the ground that she was "receiving
CAMPOS, JR., J p:
bribe money". Said Memorandum of Termination which took effect on
The sole issue for our consideration in this case is whether or not membership February 9, 1987, was the subject of an appeal to the Inter-Agency Review
in the bar, which is the qualification requirement prescribed for appointment Committee which in turn referred the appeal to the Merit Systems Protection
to the position of Deputy Register of Deeds under Section 4 of Executive Board (MSPB).
Order No. 649 (Reorganizing the Land Registration Commission (LRC) into the
In its Order dated July 6, 1987, the MSPB dropped the appeal of petitioner
National Land Titles and Deeds Registration Administration or NALTDRA)
Garcia on the ground that since the termination of her services was due to the
should be required of and/or applied only to new applicants and not to those
expiration of her temporary appointment, her separation is in order. Her
who were already in the service of the LRC as deputy register of deeds at the
motion for reconsideration was denied on similar ground." 1
time of the issuance and implementation of the abovesaid Executive Order.
However, in its Resolution 2 dated June 30, 1988, the Civil Service Commission (LRC) into the National Land Titles and Deeds Registration
Commission directed that private respondent Garcia be restored to her Administration (NALTDRA), reveals that said law in express terms, provided
position as Deputy Register of Deeds II or its equivalent in the NALTDRA. It for the abolition of existing positions, to wit:
held that "under the vested right theory the new requirement of BAR
membership to qualify for permanent appointment as Deputy Register of Sec. 8. Abolition of Existing Positions in the Land Registration Commission . . .
Deeds II or higher as mandated under said Executive Order, would not apply
All structural units in the Land Registration Commission and in the registries
to her (private respondent Garcia) but only to the filling up of vacant lawyer
of deeds, and all Positions therein shall cease to exist from the date specified
positions on or after February 9, 1981, the date said Executive Order took
in the implementing order to be issued by the President pursuant to the
effect." 3 A fortiori, since private respondent Garcia had been holding the
preceding paragraph. Their pertinent functions, applicable appropriations,
position of Deputy Register of Deeds II from 1977 to September 1984, she
records, equipment and property shall be transferred to the appropriate staff
should not be affected by the operation on February 1, 1981 of Executive
or offices therein created. (Emphasis Supplied.)
Order No. 649.
Thus, without need of any interpretation, the law mandates that from the
Petitioner NALTDRA filed the present petition to assail the validity of the
moment an implementing order is issued, all positions in the Land
above Resolution of the Civil Service Commission. It contends that Sections 8
Registration Commission are deemed non-existent. This, however, does not
and 10 of Executive Order No. 649 abolished all existing positions in the LRC
mean removal. Abolition of a position does not involve or mean removal for
and transferred their functions to the appropriate new offices created by said
the reason that removal implies that the post subsists and that one is merely
Executive Order, which newly created offices required the issuance of new
separated therefrom. 5 After abolition, there is in law no occupant. Thus,
appointments to qualified office holders. Verily, Executive Order No. 649
there can be no tenure to speak of. It is in this sense that from the standpoint
applies to private respondent Garcia, and not being a member of the Bar, she
of strict law, the question of any impairment of security of tenure does not
cannot be reinstated to her former position as Deputy Register of Deeds II.
arise. 6
We find merit in the petition.
Nothing is better settled in our law than that the abolition of an office within
Executive Order No. 649 authorized the reorganization of the Land the competence of a legitimate body if done in good faith suffers from no
Registration Commission (LRC) into the National Land Titles and Deeds infirmity. Two questions therefore arise: (1) was the abolition carried out by a
Registration Administration (NALTDRA). It abolished all the positions in the legitimate body?; and (2) was it done in good faith?
now defunct LRC and required new appointments to be issued to all
There is no dispute over the authority to carry out a valid reorganization in
employees of the NALTDRA.
any branch or agency of the Government. Under Section 9, Article XVII of the
The question of whether or not a law abolishes an office is one of legislative 1973 Constitution, the applicable law at that time:
intent about which there can be no controversy whatsoever if there is an
Sec. 9. All officials and employees in the existing Government of the Republic
explicit declaration in the law itself. 4 A closer examination of Executive Order
of the Philippines shall continue in office until otherwise provided by law or
No. 649 which authorized the reorganization of the Land Registration
decreed by the incumbent President of the Philippines, but all officials whose
appointments are by this Constitution vested in the Prime Minister shall To reiterate, the position which private respondent Garcia would like to
vacate their respective offices upon the appointment and qualifications of occupy anew was abolished pursuant to Executive Order No. 649, a valid
their successors. reorganization measure. There is no vested property right to be re employed
in a reorganized office. Not being a member of the Bar, the minimum
The power to reorganize is, however; not absolute. We have held in Dario vs. requirement to qualify under the reorganization law for permanent
Mison 7 that reorganizations in this jurisdiction have been regarded as valid appointment as Deputy Register of Deeds II, she cannot be reinstated to her
provided they are pursued in good faith. This court has pronounced 8 that if former position without violating the express mandate of the law.
the newly created office has substantially new, different or additional
functions, duties or powers, so that it may be said in fact to create an office WHEREFORE, premises considered, We hereby GRANT the petition and SET
different from the one abolished, even though it embraces all or some of the ASIDE the questioned Resolution of the Civil Service Commission reinstating
duties of the old office it will be considered as an abolition of one office and private respondent to her former position as Deputy Register of Deeds II or
the creation of a new or different one. The same is true if one office is its equivalent in the National Land Titles and Deeds Registration
abolished and its duties, for reasons of economy are given to an existing Administration.
officer or office.
SO ORDERED.
Executive Order No. 649 was enacted to improve the services and better
systematize the operation of the Land Registration Commission. 9 A
reorganization is carried out in good faith if it is for the purpose of economy
or to make bureaucracy more efficient. 10 To this end, the requirement of Bar
membership to qualify for key positions in the NALTDRA was imposed to meet
the changing circumstances and new development of the times. 11 Private
respondent Garcia who formerly held the position of Deputy Register of Deeds
II did not have such qualification. It is thus clear that she cannot hold any key
position in the NALTDRA, The additional qualification was not intended to
remove her from office. Rather, it was a criterion imposed concomitant with a
valid reorganization measure.

A final word, on the "vested right theory" advanced by respondent Civil


Service Commission. There is no such thing as a vested interest or an estate
in an office, or even an absolute right to hold it. Except constitutional offices
which provide for special immunity as regards salary and tenure, no one can
be said to have any vested right in an office or its salary. 12 None of the
exceptions to this rule are obtaining in this case.
Republic of the Philippines Prior to the reorganization of the then Minister of Agriculture and Food (the
SUPREME COURT "MAF"), the private respondent Juana Banan was the incumbent Municipal
Manila Agricultural Officer (MAO) of the aforesaid Minister in Region II, Cagayan,
while the petitioner Eliseo Sinon occupied the position of Fisheries Extension
EN BANC Specialist (FES) II in the Bureau of Fisheries and Aquatic Resources (BFAR) in
the same region.

However, the reorganization of the MAF into the Department of Agriculture


G.R. No. 101251 November 5, 1992
(the "DA"), with the issuance of Executive Order No. 116 dated 30 January
ELISEO A. SINON, petitioner, 1987, called for the evaluation of the following employees for twenty nine
vs. position of MAO in Region II, Cagayan. The list as prepared by the Placement
CIVIL SERVICE COMMISSION, DEPARTMENT OF AGRICULTURE- Committee included the herein petitioner Sinon but excluded the respondent
REORGANIZATION APPEALS BOARD AND JUANA BANAN, respondents. Banan:

1. Binoya, Vicente 76.20%

CAMPOS, JR., J.: 2. Cabana, Isidro 75.01%

This petition for certiorari seeks to annul the following Resolutions of the 3. Sebastian, Alice 74.18%
public respondents Civil Service Commission (the "CSC") * and Department of
4. Zingapan, Benjamin 70.73%
Agriculture Reorganization Appeals Board (the "DARAB"), ** to wit:
5. Guzman, Wilhemina de la P. 70.50%
1. Resolution No. 97 dated August 23, 1989, issued by respondent DARAB
which revoked petitioner's permanent appointment as Municipal Agriculture 6. Gervacio, Agnes 69.86%
Officer (MAO) and appointed, in his stead, private respondent Juana Banan
(Rollo 17); 7. Somera, Hilario S. 68.13%

2. Resolution dated February 8, 1991 issued by the respondent CSC affirming 8. Tolentino, Julian R. 67.64%
the aforementioned Resolution of respondent DARAB (Rollo 22);
9. Guillermo, Pedro 67.22%
3. Resolution dated July 11, 1991 issued by the respondent CSC which denied
petitioner's motion for the reconsideration of the respondent Commission's 10. Tambio, Rodolfo 67.00%
Resolution dated February 8, 1991. 1
11. Aquino, Martina 66.94%
The antecedent facts are as follows:
12. Bassig, Pio P. 66.84%
13. Rumpon, Danilo P. 65.61% Thus, respondents Banan filed an appeal with the DARAB for re-evaluation of
the qualification of all those included in the aforementioned list made by the
14. Zareno, Bernardo 65.57% Placement Committee.

15. Madrid, Angel S. 65.57% On August 23, 1989, the DARAB released Resolution No. 97 in which the
ranking for 29 MAO prepared by the Placement Committee was re-evaluated
16. Callangan, Napoleon 65.45%
as follows:
17. Fiesta, Felicisimo 65.29%
1. Binoya, Vicente 76.20%
18. Alvarez, Benefranco 64.99%
2. Cabana, Isidro 75.01%
19. Baggayan, Samuel O. 64.42%
3. Sebastian, Alice 72.18%
20. Umbay, Pedro T. 64.01%
4. Zingapan, Benjamin 70.73%
21. De la Cruz, Florencio M. 62.07%
5. Guzman, Wilhemina de la P. 70.50%
22. Leonador, Ernesto T. 61.88%
6. Gervacio, Agnes 70.04%
23. Miguel, Jose 61.86%
7. Somera, Hilario S. 68.13%
24. Berlan, Herminia C. 61.76%
8. Tolentino, Julian Jr. 67.22%
25. Soliman, Clemente 61.52%
9. Guillermo, Pedro 67.22%
26. Llopis, Lino 61.47%
10. Tambio, Rodolfo 67.00%
27. Baliuag, Felicidad 61.39%
11. Aquino, Martina D. 66.94%
28. Aresta, Leticia 60.67%
12. Bassig, Pio P. 66.84%
29. Sinon, Eliseo A. 60.66% 2
13. Rumpon, Danilo P. 65.61%
(Emphasis supplied)
14. Madrid, Angel 65.57%

15. Callangan, Napoleon 65.45%


16. Fiesta, Felicisimo 65.29% Thus, Sinon filed an appeal docketed as Civil Service Case No. 573 on
November 22, 1989 to the CSC. This appeal was granted mainly for two
17. Alvarez, Benefranco 64.99% reasons: first, the respondent DARAB failed to file its Comment within the
period required; and second, the evaluation of the qualification of the
18. Baggayan, Samuel O. 64.42%
employees is a question of fact which the appointing authority or the
19. Umbay, Pedro T. 64.01% Placement Committee assisting him is in a better position to determine.
Hence, the Resolution dated 28 February 1989 of the DARAB was set aside. 4
20. De la Cruz, Florencio M. 62.07%
On March 19, 1990, Banan filed a Motion for Reconsideration in which she
21. Leonador, Ernesto T. 61.88% pitted her qualifications against Sinon for the last slot in the 29 available MAO
positions. At the same time, she pointed out that to allow the findings of the
22. Miguel, Jose L. 61.86%
Placement Committee to supersede the DARAB resolution which the Secretary
23. Berlan, Herminia C. 61.76% of Agriculture had approved would be tantamount to giving precedence to the
Placement Committee over the head of the agency.
24. Soliman, Clemente 61.52%
Finally, on February 8, 1991, CSC, after reviewing the Comment filed by the
25. Zareno, Bernardo 61.50% DARAB which had not been considered earlier in the Civil Service Case No.
573, the CSC granted respondent Banan's Motion for Reconsideration and
26. Llopis, Lino 61.47% gave due course to her appointment by the DARAB.

27. Baliuag, Felicidad 61.39% On March 21, 1991, Sinon filed a Motion for Reconsideration of the February
8, 1991 Resolution which however was denied by the CSC in its assailed
28. Aresta, Leticia 60.67%
Resolution dated July 11, 1991.
29. Banan, Juana 59.32% 2
According to the respondent CSC:
(Emphasis supplied)
Mr. Sinon strongly argued that the findings of the Placement Committee on
In this re-evaluation, petitioner Sinon was displaced by the respondent Banan the qualifications of the parties should be accorded deference and greater
and this same resolution was duly approved by the Secretary of the weight over that of the RAB. Under the Placement Committee's evaluation,
Department of Agriculture, Carlos G. Dominguez, who also affixed his Mr. Sinon garnered 60.66 while Ms. Juana Banan earned 57.32 after
signature on the same date. assessing the contending parties qualification in education, relevant
experience, eligibility and other factors. Following the request of several
However, on August 30, 1988, Sinon received an appointment as MAO for parties for reevaluation, the RAB in their decision gave Mr. Sinon 57.66 while
Region II in Cagayan as approved by Regional Director Gumersindo D. Lasam Ms. Banan obtained 59.32. Seemingly the findings of the two bodies are in
on the basis of the first evaluation made by the Placement Committee.
conflict. Mr. Sinon argues that the findings of the Placement Committee respondent from a rating of only 57.32%, the CSC departed from its power
should prevail since it is specially mandated by RA 6656. which is limited only to that of "review", and hence encroached upon the
power of appointment exclusively lodged in the appointment authority;
We disagree. The Placement Committee's function is recommendatory in
nature. The agency's Reorganization Appeals Board was specially created by 3) In giving due course to the appointment of respondent Banan in its
the Circular of the Office of the President dated October 2, 1987 and Resolution of 8 February 1991, CSC was directing the appointment of a
conferred with authority to review appeals and complaints of officials and substitute of their own choice when the power to appoint was exclusively
employees affected by the reorganization. the decision of the agency RAB has lodged in the appointing authority.
the imprimatur of the Secretary of that agency and is therefore controlling in
matters of and is therefore controlling in matters of appointment. Under this We rule as follows.
principle, the decision of the DARAB in this case enjoys precedence over the
By grave abuse of discretion is meant such capricious and whimsical exercise
Placement Committee. 5
of judgment as is equivalent to lack of jurisdiction. The abuse of discretion
Hence, this petition was filed with a prayer for a writ of preliminary injunction must be patent and gross as to amount to an evasion of positive duty or a
and/or restraining order to enjoin the execution of the assailed resolutions. virtual refusal to perform a duty enjoined by law, or to act at all in
contemplation of law, as where the power is exercised in an arbitrary and
Without giving due course to the petition for a writ of preliminary injunction, despotic manner by reason of passion or hostility.9
the court required the parties to file their respective Comments. 6
Contrary to the allegations of the petitioner, We do not find any evidence of
On 12 November 1991, the Court gave due course to the petition and grave abuse of discretion on the part of the CSC when it issued Resolution
required the parties to submit their respective Memoranda. 7 dated 8 February 1991 which in effect approved the appointment of
respondent Banan over petitioner Sinon.
The main issue for Our consideration is this: whether or not the CSC
committed grave abuse discretion in reviewing and re-evaluating the ring or With the reorganization of the MAF into the DA with Executive order No. 116,
qualification of the petitioner Sinon. it became imperative to "protect the security of tenure of Civil Service Officers
and employees in the implementation of government reorganization". Thus,
The arguments of the petitioner can be summed up as follows: Congress passed Republic Act No. 6656. 10

1). In issuing the Resolution of 8 February 1991, the CSC in effect revoked It was under the same law of R.A. 6656 that the Placement Committee was
the appointment that the petitioner received as early as 30 August 1989 and created:
which was deemed permanent by virtue of the approval of the Regional
Director of the Department of Agriculture: Section 6. In order that the best qualified and mot deserving persons shall be
appointed in any reorganization, there shall be created a Placement
2). In giving petitioner a rating of only 57.66%, 8 from his previous rating of Committee in each department or agency to assist the appointing authority in
60.66% and at the same time according a rating of 59.32% to private the judicious selection and placement of personnel. The Committee shall
consist of two (2) members appointed by the head of the department or The foregoing legal measures spell out the remedies of aggrieved parties
agency, a representative of the appointing authority, and two (2) members which make it impossible to give the status of finality to any appointment
duly elected by the employees holding positions in the first and second levels until all protests or oppositions are duly heard.
of the career service: Provided, that if there is a registered employee
association with a majority of the employees as members, that employee Thus, while it is true that the appointment paper received by petitioner Sinon
association shall also have a representative in the Committee: Provided, on 30 August 1989 for the position of MAO had not conferred any permanent
Further, that immediately upon the approval of the staffing pattern of the status and was still subject to the following conditions attached to any
department or agency concerned, such staffing pattern shall be made known appointment in the civil service:
to all officers and employees of the agency who shall be invited to apply for
Provided that there is no pending administrative case against the appointee,
any of the positions authorized therein. Such application shall be considered
no pending protest against the appointment, nor any decision by competent
by the committee in the placement and selection of personnel. (Emphasis
authority that will adversely affect the approval of the appointment . 15
supplied).
Hence, for as long as the re-evaluation of the qualification filed by Banan was
To "assist" mean to lend an aid to, 11 or to contribute effort in the complete
pending, the petitioner cannot claim that he had been issued with a
accomplishment of an ultimate purpose intended to be effected by those
"complete" appointment. Neither is there any point in asserting that his
engaged. 12
appointment had "cured" whatever changes was subsequently recommended
In contrast, to "recommend" 13 is to present one's advice or choice as having by the DARAB. 16
one's approval or to represent or urge as advisable or expedient. It involves
The fact that the DARAB is capable of re-evaluating the findings of the
the Idea that another has the final decision.
Placement Committed only to find that Sinon is not qualified should no be
Clearly, the Placement Committee was charged with the duty of exercising taken as a grave abuse of discretion.
the same discretionary functions as the appointing authority in the judicious
We cannot subscribe to petitioner Sinon's insistence that the public
selection and placement of personnel when the law empowered it to "assist"
respondent CSC had disregarded the findings of the Placement Committee.
the appointment authority.
The truth is, these findings of the Placement Committee. The truth is, these
The same law also allows any officer or employee aggrieved by the findings were re-evaluated and the report after such re-evaluation was
appointments to file an appeal with the appointing authority who shall made a submitted to and approved by the Secretary of Agriculture. The CSC affirmed
decision within thirty (30) days from the filing thereof. If the same employee the findings of the DARAB.
is still not satisfied with the decision of the appointing authority, he may
Because of all the foregoing circumstances, the jurisprudence cited by the
further appeal within ten (10) days from the receipt thereof the CSC. 14
petitioner Sinon appears to be incorrect. 17
In the case at bar, the Circular dated October 2, 1987 of the Office of the
Neither do we find in the Resolution of 8 February 1991, any statement by
President created the agency Reorganization Appeals Board to address the
the CSC directing the appointment of the respondent Banan. Hence, there
problem of the employees affected by the reorganizations.
was no directive from the CSC that may be misinterpreted as a usurpation of
any appointing power. 18

Besides, in affirming the appointment of Banan as recommended by the


DARAB and approved by the Secretary of Agriculture, the CSC is only being
consistent with the law. Section 4 or R.A. 6656 mandates that officers and
employees holding permanent appointments shall be given preference for
appointment to the new positions in the approved staffing pattern comparable
to their former positions. Also, the term incumbent officer and the privileges
generally accorded to them would more aptly refer to Banan and not to
petitioner Sinon whose appointment was never confirmed
completely. 19There is no dispute that the position of MAO in the old staffing
pattern is most comparable to the MAO in the new staffing pattern.

Finally, the Solicitor General in behalf of the CSC correctly noted that the
petitioner Sinon had conveniently omitted the then Secretary of Agriculture
who had affixed his approval on the findings of the DARAB. Petitioner Sinon
knew fully well that as head of the agency, the Secretary of Agriculture was
the appointing authority.

It must be recalled that the whole purpose of reorganization is that is it is a


"process of restructuring the bureaucracy's organizational and functional set-
up, to make it more viable in terms of the economy, efficiency, effectiveness
and make it more responsive to the needs of its public clientele as authorized
by law." 20 For as long as the CSC confines itself within the limits set out by
law and does not encroach upon the prerogatives endowed to other
authorities, this Court must sustain the Commission.

WHEREFORE, the petition is DENIED with costs against the petitioner.

SO ORDERED.
Republic of the Philippines Further, Sections 33 and 34 thereof provide:
SUPREME COURT
Manila Sec. 33. Implementing Details; Organization and Staffing of the Bank.

EN BANC xxx xxx xxx

G.R. No. 93355 April 7, 1992 In the implementation of the reorganization of the Bank, as authorized under
the preceding section, qualified personnel of the Bank may be appointed to
LUIS B. DOMINGO, petitioner, appropriate positions in the new staffing pattern thereof and those not so
vs. appointed are deemed separated from the service. No preferential or priority
DEVELOPMENT BANK OF THE PHILIPPINES and CIVIL SERVICE rights shall be given to or enjoyed by any officer or personnel of the Bank for
COMMISSION, respondents. appointment to any position in the new staffing pattern nor shall any officer
or personnel be considered as having prior or vested rights with respect to
retention in the Bank or in any position as may have been created in its new
staffing pattern, even if he should be the incumbent of a similar position
REGALADO, J.:
therein.
This special civil action impugns the resolution 1 of respondent Civil Service
xxx xxx xxx
Commission (CSC) promulgated on April 10, 1990 in CSC Case No. 473
setting aside its earlier resolution of November 27, 1989 and affirming the Sec. 34. Separation Benefits. — All those who shall retire from the service or
separation of petitioner Luis B. Domingo as Senior Training and Career are separated therefrom on account of the reorganization of the Bank under
Development Officer of the Development Bank of the Philippines (DBP). the provisions of this Charter shall be entitled to all gratuities and
benefits provided for under existing laws and/or supplementary retirement
Petitioner was employed by DBP as Senior Training and Career Development
plans adopted by and effective in the Bank: . . .
Officer on permanent status from February, 1979 to December 1986.
Pursuant thereto, DBP issued Board Resolution No. 304-87 allowing the
On December 3, 1986, Executive Order No 81 (The Revised Charter of DBP)
issuance of temporary appointments to all DBP personnel in order to fully
was passed authorizing the reorganization of DBP in this wise:
implement the reorganization. The resolution states in part:
Sec. 32. Authority to Reorganize. — In view of the new scope of operations of
It is understood that pursuant to Section 32 of the new DBP Charter full
the Bank, a reorganization of the Bank and a reduction in force are hereby
implementation of the reorganization program shall be completed within a
authorized to achieve simplicity and economy in operations, including
period of thirty-six (36) months from the approval of this Charter. In this
adopting a new staffing pattern to suit the reduced operations envisioned.
connection, the plantilla approved and appointments issued are purely interim
The formulation of the program of reorganization shall be completed within
and the Bank is reserving its right to put in place the permanent structure of
six months after the approval of this Charter, and the full implementation of
the reorganization program within thirty months thereafter.
the Bank as well as the permanent appointments thereto until the end of the allow for the maximum flexibility in evaluating the performance of incumbents
36-month period. 2 is not in accord with civil service law rules," in that "(t)o issue a temporary
appointment to one who has been on permanent status before will deprive
In effect, said resolution authorized the issuance of temporary appointments the employee of benefits accorded permanent employees and will adversely
to all DBP personnel to allow maximum flexibility in the implementation of the affect his security of tenure," aside from the fact that such an act is contrary
reorganization. Such temporary appointments issued had a maximum period to Section 25 (a) of Presidential Decree No. 807.
of twelve (12) months during which period the performance of the
incumbents were assessed on the basis of the results of their evaluation. DBP filed a motion for reconsideration 6 on December 27, 1989 alleging, inter
alia, that the issuance of temporary appointments to all the DBP employees
With the passage of Executive Order No. 81 and Board Resolution No. 304 87, was purely an interim arrangement; that in spite of the temporary
DBP undertook the evaluation and comparative assessment of all its appointment, they continued to enjoy the salary, allowances and other
personnel under the CSC approved New Performance Appraisal System, a benefits corresponding to permanent employees; that there can be no
peer and control rating process which served as an assessment tool of DBP's impairment of herein petitioner's security of tenure since the new DBP charter
screening process. expressly provides that "qualified personnel of the bank may be appointed to
appropriate positions in the new staffing pattern and those not so appointed
Petitioner Domingo was issued a temporary appointment on January 2, 1987
are deemed separated from the service;" that petitioner was evaluated and
for a period of one (1) year, which was renewed for another period up to
comparatively assessed under a rating system approved by the respondent
November 30, 1988. Thereafter, in a memorandum 3 dated November 23,
commission; and that petitioner cannot claim that he was denied due process
1988 issued by the Final Review Committee, petitioner got a performance
of law considering that, although several appeals were received by the Final
rating of "below average," by reason of which his appointment was "made to
Review Committee from other employees similarly situated, herein petitioner
lapse."
never appealed his rating or the extension of his temporary appointment
Consequently, petitioner, together with a certain Evangeline Javier, filed with although he was advised to do so by his direct supervisor.
the CSC a joint verified complaint 4against DBP for illegal dismissal. The
On April 10, 1990, CSC rendered the questioned resolution setting aside its
complainants therein alleged that their dismissal constituted a violation of the
previous decision and affirming the separation of herein petitioner. In so
Civil Service Law against the issuance of temporary appointments to
ruling, CSC explained that:
permanent employees, as well as of their right to security of tenure and due
process. While it is true that this Commission ruled that the issuance of temporary
appointment to all DBP personnel in order to allow "for maximum flexibility" in
On November 27, 1989, CSC issued a resolution 5 in CSC Case No. 473
evaluating the performance of incumbents is not in accord with civil service
directing "the reappointment of Mr. Domingo and Ms. Javier as Senior
laws and rules, however it cannot lose sight of the fact that appellants are
Training and Career Development Officer and Research Analyst or any such
among those who indeed got a below average rating (unsatisfactory) when
equivalent rank under the staffing pattern of DBP." The order for
their performance were reevaluated and comparatively reassessed by the
reappointment was premised on the findings of the CSC that "(t)he action of
Final Review Committee of the Bank approved by the Vice Chairman.
the DBP to issue temporary appointments to all DBP personnel in order to
xxx xxx xxx for separation from the service and found out that appellants are wanting of
performance, having been rated as "Below Average." 7
In effect, the determinative factor for retention and the separation from the
service is the individual performance rating. Hence this petition, whereby petitioner raises the following issues:

While the Commission supports the principle of merit and fitness and strongly 1. Petitioner's tenure of office was violated by respondents;
protects the security of tenure of civil service officials and employees which
are the essence of careerism in the civil service, it does not however, sanction 2. Petitioner was not afforded a day in court and was denied procedural due
the reappointment of said officials and employees who have fallen short of the process in the unilateral evaluation by his peers of his efficiency ratings for
performance necessary in order to maintain at all times efficiency and the years 1987 and 1988;
effectiveness in the Office.
3. Average and below average efficiency ratings are not valid grounds for
It bears stressing that the DBP submitted the records and documents in termination of the service of petitioner;
support of its allegations that Mr. Domingo and Ms. Javier have indeed
4. Section 5 of the rules implementing Republic Act No. 6656 is repugnant to
got(ten) a below average rating (unsatisfactory) during the filing of the
the constitutional mandate that "no officer or employee of the Civil Service be
instant motion for reconsideration. Had DBP promptly submitted the
removed or suspended except for causeprovided by law;" and
records/documents supporting its allegations, this Commission at the outset
should have sustained the separation of the appellants from the service on 5. Section 16, Article XVIII, Transitory Provisions of the New Constitution was
ground of poor performance (below average rating, unsatisfactory) after the also violated by respondents. 8
reassessment and re-evaluation by the Bank through the Final Review
Committee. The CSC could not have guessed that such was the basis of the I. Petitioner puts in issue the validity of the reorganization implemented by
DBP's termination of Domingo and Javier until the papers were submitted to DBP in that the same violates his right to security of tenure. He contends that
it. . . . government reorganization cannot be a valid ground to terminate the services
of government employees, pursuant to the ruling in the case of Dario vs.
It must be pointed out that appellants' separation from the service was the Mison, et al.9
lapse of their temporary appointment. The non-extension or non-issuance of
permanent appointments were principally based on their below average rating This statement of petitioner is incomplete and inaccurate, if not outright
(unsatisfactory) performance after they were reevaluated and comparatively erroneous. Either petitioner misunderstood or he totally overlooked what was
reassessed by the Final Review Committee of the Bank. After all, the 1986 stated in the aforecited decision which held that "reorganizations in this
DBP Revised Charter (E.O. No. 81) gives the Bank a wide latitude of jurisdiction have been regarded as valid provided they are pursued in good
discretion in the reappointment of its personnel, subject to existing civil faith." As we said in Dario:
service laws, rules and regulations.
Reorganizations in this jurisdiction have been regarded as valid provided they
There is no doubt that the DBP conducted a reevaluation and comparative are pursued in good faith. As a general rule, a reorganization is carried out in
reassessment of its employees for placement/retention (for permanent) and "good faith" if it is for the purpose of economy or to make bureaucracy more
efficient. In that event, no dismissal (in case of dismissal) or separation Through this rating, the Bank determines the value of the individual employee
actually occurs because the position itself ceases to exist. And in that case, to the Bank with the help of his peers (peer rating) and his supervisors
security of tenure would not be a Chinese wall. (control
rating). 11
Clearly, from our pronouncements in Dario, reorganization is a recognized
valid ground for separation of civil service employees, subject only to the Also, as part of the evaluation process, a Final Review Committee, composed
condition that it be done in good faith. No less than the Constitution itself in of the group, department or unit head, the heads of the Human Resource
Section 16 of the Transitory Provisions, together with Sections 33 and 34 of Center and of the Personnel Services, and representatives from the Career
Executive Order No. 81 and Section 9 of Republic Act No. 6656, support this Officials Association and the Employees Union, was created to screen further
conclusion with the declaration that all those not so appointed in the and to recommend the change in status of the employee's appointment from
implementation of said reorganization shall be deemed separated from the temporary to permanent beginning 1988. For the rank and file level, the
service with the concomitant recognition of their entitlement to appropriate committee was chaired by the Vice-Chairman while the officer level was
separation benefits and/or retirement plans of the reorganized government presided over by the Chairman of the Bank. 12
agency.
The performance rating system used and adopted by DBP was duly approved
The facts of this case, particularly the evaluation process adopted by DBP, by the Civil Service Commission. Herein petitioner was evaluated and
bear out the existence of good faith in the course of reorganization. comparatively assessed under this approved rating system. This is shown by
the memorandum to the Vice-Chairman from the DBP Final Review
As a tool in the assessment process, a bank-wide peer and control rating Committee wherein petitioner, among other DBP employees, was evaluated
process was implemented. Under this process, the peers and supervisors and rated on his performance, and was shown to have gotten a rating of
rated the DBP employees. 10 "below average." 13

To make the reorganization as open, representative and fair as possible, two In the comment 14 filed by DBP with the CSC, respondent bank explained the
principal groups were formed: (1) the Group Placement Screening Committee procedure it adopted in the evaluation of herein petitioner, together with one
(GPSC) and (2) the Central Placement Screening Committee (CPSC), to Evangeline Javier, to wit:
review all recommendations (for retention or separation) prior to submissions
to the Chairman an the Board of Directors. The members of the two screening xxx xxx xxx
committees were the Department and Group Heads and representatives from
the Career Officials Association and the DBP Employees Union. The CPSC was 4. During the second phase of the screening process, the Bank used several
further represented by the DBP Civil Service Officer, who sat as consultant to instruments for determining proficiency or skills on the job. More than skills,
help resolve questions on Civil Service rules and regulations. however, the evaluation also covered trait factors to determine a positive
work attitude. The Bank placed a premium on work attitude because it
As an assessment tool to the Bank's screening process, a peer and control believes that technical and professional skills can easily be acquired by an
rating process was implemented bank-wide, the results of which were used as ordinary normal individual as long as he has the right attitude towards
a gauge to determine the suitability of an employee to stay in the Bank. learning.
5. These attitudes are part of the new corporate culture outlined in the Sec. 27. Reduction in Force. — Whenever it becomes necessary because of
corporate philosophy instituted for the Bank and disseminated thru the lack of work or funds or due to a change in the scope or nature of an agency's
various corporate culture seminars, monthly tertulias, speeches of the program, or as a result of reorganization, to reduce the staff of any
Chairman and numerous various internal communications and bulletins. One department or agency, those in the same group or class of positions in one or
of the most important values emphasized was TEAMWORK due to the very more agencies within the particular department or agency wherein the
lean personnel force that the Bank was left with and the competition it has to reduction is to be effected shall be reasonably compared in terms of relative
contend with in the industry. fitness, efficiency and length of service, and those found to be least qualified
for the remaining positions shall be laid off.
6. Mr. Domingo and Miss Javier were subjected to this rating process as all
other employees of the Bank were. Lastly, petitioner failed to invoke the presence of any of the circumstances
enumerated under Section 2 of Republic Act No. 6656 which would show or
xxx xxx xxx tend to show the existence of bad faith in the implementation of the
reorganization.
8. Mr. Domingo and Miss Javier were recommended for a renewal of
temporary status after assessment of their performance because of several Quintessentially, the reorganization having been conducted in accordance
indications of lack of skill and their inability to work with others in the with the mandate of Dario, it can safely be concluded that indeed the
department where they were stationed. In a compassionate stance, it was reorganization was attended by good faith, ergo, valid. The dismissal of
considered in the Central Personnel Committee to transfer them to another herein petitioner is a removal for cause which, therefore, does not violate his
department or unit of the Bank where they may be more effective and security of tenure.
productive, but they expressed preference to stay in the training unit of the
Bank, the Human Resource Center. As a final note on this issue, we quote with approval the statement of Mme.
Justice Ameurfina A. Melencio-Herrera in her dissenting opinion in the above-
9. Along with others whose performance for 1987 was found wanting, Mr. cited case:
Domingo and Miss Javier were recommended for reappointment as temporary
for another period from January to November 1988 to give the Bank sufficient To be sure, the reorganization could affect the tenure of members of the
time to consider their cases. However, in an evaluation of performance for all career service as defined in Section 5, Article IV of Presidential Decree No.
extendees in November 1988, Mr. Domingo and Miss Javier were again found 807, and may even result in the separation from office of some meritorious
wanting having both acquired a rating of "Below Average." employees. But even then, the greater good of the greatest number and the
right of the citizenry to a good government, and as they themselves have
In addition, it is not disputed that DBP now has less than 2,000 employees mandated through the vehicle of Proclamation No. 3, provide the justification
from a former high level of around 4,000 employees in 1986. And, under for the said injury to the individual. In terms of values, the interest of an
Section 27 of Presidential Decree No. 807, the Government is authorized to employee to security of tenure must yield to the interest of the entire
lay off employees in case of a reduction due to reorganization, thus: populace and to an efficient and honest government.
II. Petitioner also maintains that "average" and "below average" efficiency termination and, therefore, he should be afforded a day in court, pursuant to
ratings are not valid grounds for his termination from the service. the requirements of procedural due process, to defend himself against any
adverse findings in the process of evaluation of his performance.
It has become a basic and primordial concern of the State to insure and
promote the constitutional mandate that appointments in the civil service Petitioner's contention cannot be sustained.
shall be made only according to merit and fitness pursuant to its adopted
policy of requiring public officers and employees to serve with the highest Section 2 of Republic Act No. 6656 provides that "no officer or employee in
degree of responsibility, integrity, loyalty and efficiency. 15 As a matter of fact, the career service shall be removed except for a valid cause and after due
the development and retention of a competent and efficient work force in the notice and hearing." Thus, there is no question that while dismissal due to
public service is considered as a primary concern of the a bona fide reorganization is recognized as a valid cause, this does not justify
Government. 16 Hence, employees are selected on the basis of merit and a detraction from the mandatory requirement of notice and hearing. However,
fitness to perform the duties and assume the responsibilities of the position to it is equally true and it is a basic rule of due process that "what the law
which they are appointed. 17Concomitantly, the government has committed prohibits is not the absence of previous notice but the absolute absence
itself to engender a continuing program of career and personnel development thereof and the lack of opportunity to be heard." 21 There is no violation of
for all government employees, 18 by establishing a performance evaluation procedural due process even where no hearing was conducted for as long as
system to be administered in such manner as to continually foster the the party was given a chance to present his evidence and defend himself.
improvement of individual employee efficiency and organizational
The records show that petitioner had the opportunity to present his side
effectiveness. 19
and/or to contest the results of the evaluation proceedings. In DBP's motion
All these abundantly show that the State puts a premium on an individual's for the reconsideration of the original decision of respondent commission,
efficiency, merit and fitness before one is accepted into the career service. A respondent bank averred:
civil service employee's efficiency rating, therefore, is a decisive factor for his
It may be stated that although several appeals were received by the Final
continued service with the Government. The inescapable conclusion is that a
Review Committee from other employees similarly situated (i.e., also given
"below average" efficiency rating is sufficient justification for the termination
temporary appointments for 1988), Mr. Domingo and Miss Javier never
of a government employee such as herein petitioner. This is the reason why,
appealed their ratings or the extension of their temporary appointments in
painful as it may be, petitioner's separation must be affirmed if public good is
1988. Even at this writing, the Bank has not received any formal appeal from
to be subserved. In the words of respondent commission in its questioned
them although they were advised to do so by their direct supervisor. 22
resolution, it cannot "sanction the reappointment of said officials and
employees who have fallen short of the performance necessary in order to The fact that petitioner made no appeal to the Final Review Committee was
maintain at all times efficiency and effectiveness in the Office." 20 duly considered by respondent commission in resolving said motion for
reconsideration and in affirming the separation of petitioner from the service,
III. Petitioner finally contends that where the purpose of the evaluation
noting that "appellants Mr. Domingo, and Miss Javier did not file or submit
proceeding is to ascertain whether he should be retained or separated from
their opposition to the motion for reconsideration." Consequently, petitioner
the service, it is a proceeding to determine the existence of a ground for his
cannot, by his own inaction, legally claim that he was denied due process of
law.

Considering petitioner's years of service, despite the unfortunate result of the


reorganization insofar as he is concerned, he should be allowed separation
and other retirement benefits accruing to him by reason of his termination,
as provided for in Section 16, Article XVIII of the 1987 Constitution, as well as
in Section 9 of Republic Act No. 6656 and Section 34 of Executive Order No.
81.

WHEREFORE, no grave abuse of discretion having been committed by


respondent Civil Service Commission, its challenged resolution of April 10,
1990 is hereby AFFIRMED.

SO ORDERED.
Republic of the Philippines WHEREAS, Section 3, Article IX-B of the 1987 Philippine Constitution provides
SUPREME COURT that "The Civil Service Commission, as the central personnel agency of the
Manila government, is mandated to establish a career service and adopt measures to
promote morale, efficiency, integrity, responsiveness, progresiveness and
EN BANC courtesy in the civil service, . . .";

WHEREAS, Section 12 (1), Title I, Subtitle A, Book V of the Administrative


Code of 1987 grants the Commission the power, among others, to administer
G.R. No. 115863 March 31, 1995
and enforce the constitutional and statutory provisions on the merit system
AIDA D. EUGENIO, petitioner, for all levels and ranks in the Civil Service;
vs.
WHEREAS, Section 7, Title I, Subtitle A, Book V of the Administrative Code of
CIVIL SERVICE COMMISSION, HON. TEOFISTO T. GUINGONA, JR. &
1987 Provides, among others, that The Career Service shall be characterized
HON. SALVADOR ENRIQUEZ, JR., respondents.
by (1) entrance based on merit and fitness to be determined as far as
practicable by competitive examination, or based highly technical
qualifications; (2) opportunity for advancement to higher career positions;
PUNO, J.: and (3) security of tenure;

The power of the Civil Service Commission to abolish the Career Executive WHEREAS, Section 8 (c), Title I, Subtitle A, Book V of the administrative Code
Service Board is challenged in this petition for certiorari and prohibition. of 1987 provides that "The third level shall cover Positions in the Career
Executive Service";
First the facts. Petitioner is the Deputy Director of the Philippine Nuclear
Research Institute. She applied for a Career Executive Service (CES) Eligibility WHEREAS, the Commission recognizes the imperative need to consolidate,
and a CESO rank on August 2, 1993, she was given a CES eligibility. On integrate and unify the administration of all levels of positions in the career
September 15, 1993, she was recommended to the President for a CESO rank service.
by the Career Executive Service Board. 1
WHEREAS, the provisions of Section 17, Title I, Subtitle A. Book V of the
All was not to turn well for petitioner. On October 1, 1993, respondent Civil Administrative Code of 1987 confers on the Commission the power and
Service Commission2 passed Resolution No. 93-4359, viz: authority to effect changes in its organization as the need arises.

RESOLUTION NO. 93-4359 WHEREAS, Section 5, Article IX-A of the Constitution provides that the Civil
Service Commission shall enjoy fiscal autonomy and the necessary
WHEREAS, Section 1(1) of Article IX-B provides that Civil Service shall be
implications thereof;
administered by the Civil Service Commission, . . .;
NOW THEREFORE, foregoing premises considered, the Civil Service A.
Commission hereby resolves to streamline reorganize and effect changes in
its organizational structure. Pursuant thereto, the Career Executive Service IN VIOLATION OF THE CONSTITUTION, RESPONDENT COMMISSION
Board, shall now be known as the Office for Career Executive Service of the USURPED THE LEGISLATIVE FUNCTIONS OF CONGRESS WHEN IT ABOLISHED
Civil Service Commission. Accordingly, the existing personnel, budget, THE CESB, AN OFFICE CREATED BY LAW, THROUGH THE ISSUANCE OF CSC:
properties and equipment of the Career Executive Service Board shall now RESOLUTION NO. 93-4359;
form part of the Office for Career Executive Service.
B.
The above resolution became an impediment. to the appointment of petitioner
ALSO IN VIOLATION OF THE CONSTITUTION, RESPONDENT CSC USURPED
as Civil Service Officer, Rank IV. In a letter to petitioner, dated June 7, 1994,
THE LEGISLATIVE FUNCTIONS OF CONGRESS WHEN IT ILLEGALLY
the Honorable Antonio T. Carpio, Chief Presidential legal Counsel, stated:
AUTHORIZED THE TRANSFER OF PUBLIC MONEY, THROUGH THE ISSUANCE
xxx xxx xxx OF CSC RESOLUTION NO. 93-4359.

On 1 October 1993 the Civil Service Commission issued CSC Resolution No. Required to file its Comment, the Solicitor General agreed with the
93-4359 which abolished the Career Executive Service Board. contentions of petitioner. Respondent Commission, however, chose to defend
its ground. It posited the following position:
Several legal issues have arisen as a result of the issuance of CSC Resolution
No. 93-4359, including whether the Civil Service Commission has authority to ARGUMENTS FOR PUBLIC RESPONDENT-CSC
abolish the Career Executive Service Board. Because these issues remain
I. THE INSTANT PETITION STATES NO CAUSE OF ACTION AGAINST THE
unresolved, the Office of the President has refrained from considering
PUBLIC RESPONDENT-CSC.
appointments of career service eligibles to career executive ranks.
II. THE RECOMMENDATION SUBMITTED TO THE PRESIDENT FOR
xxx xxx xxx
APPOINTMENT TO A CESO RANK OF PETITIONER EUGENIO WAS A VALID ACT
You may, however, bring a case before the appropriate court to settle the OF THE CAREER EXECUTIVE SERVICE BOARD OF THE CIVIL SERVICE
legal issues arising from issuance by the Civil Service Commission of CSC COMMISSION AND IT DOES NOT HAVE ANY DEFECT.
Resolution No. 93-4359, for guidance of all concerned.
III. THE OFFICE OF THE PRESIDENT IS ESTOPPED FROM QUESTIONING THE
Thank You. VALIDITY OF THE RECOMMENDATION OF THE CESB IN FAVOR OF
PETITIONER EUGENIO SINCE THE PRESIDENT HAS PREVIOUSLY APPOINTED
Finding herself bereft of further administrative relief as the Career Executive TO CESO RANK FOUR (4) OFFICIALS SIMILARLY SITUATED AS SAID
Service Board which recommended her CESO Rank IV has been abolished, PETITIONER. FURTHERMORE, LACK OF MEMBERS TO CONSTITUTE A
petitioner filed the petition at bench to annul, among others, resolution No. QUORUM. ASSUMING THERE WAS NO QUORUM, IS NOT THE FAULT OF
93-4359. The petition is anchored on the following arguments:
PUBLIC RESPONDENT CIVIL SERVICE COMMISSION BUT OF THE PRESIDENT 5. The Board shall promulgate rules, standards and procedures on the
WHO HAS THE POWER TO APPOINT THE OTHER MEMBERS OF THE CESB. selection, classification, compensation and career development of members of
the Career Executive Service. The Board shall set up the organization and
IV. THE INTEGRATION OF THE CESB INTO THE COMMISSION IS AUTHORIZED operation of the service. (Emphasis supplied)
BY LAW (Sec. 12 (1), Title I, Subtitle A, Book V of the Administrative Code of
the 1987). THIS PARTICULAR ISSUE HAD ALREADY BEEN SETTLED WHEN It cannot be disputed, therefore, that as the CESB was created by law, it can
THE HONORABLE COURT DISMISSED THE PETITION FILED BY THE only be abolished by the legislature. This follows an unbroken stream of
HONORABLE MEMBERS OF THE HOUSE OF REPRESENTATIVES, NAMELY: rulings that the creation and abolition of public offices is primarily a legislative
SIMEON A. DATUMANONG, FELICIANO R. BELMONTE, JR., RENATO V. DIAZ, function. As aptly summed up in AM JUR 2d on Public Officers and
AND MANUEL M. GARCIA IN G.R. NO. 114380. THE AFOREMENTIONED Employees, 5 viz:
PETITIONERS ALSO QUESTIONED THE INTEGRATION OF THE CESB WITH THE
COMMISSION. Except for such offices as are created by the Constitution, the creation of
public offices is primarily a legislative function. In so far as the legislative
We find merit in the petition.3 power in this respect is not restricted by constitutional provisions, it supreme,
and the legislature may decide for itself what offices are suitable, necessary,
The controlling fact is that the Career Executive Service Board (CESB) was or convenient. When in the exigencies of government it is necessary to create
created in the Presidential Decree (P.D.) No. 1 on September 1, 1974 4 which and define duties, the legislative department has the discretion to determine
adopted the Integrated Plan. Article IV, Chapter I, Part of the III of the said whether additional offices shall be created, or whether these duties shall be
Plan provides: attached to and become ex-officio duties of existing offices. An office created
by the legislature is wholly within the power of that body, and it may
Article IV — Career Executive Service
prescribe the mode of filling the office and the powers and duties of the
1. A Career Executive Service is created to form a continuing pool of well- incumbent, and if it sees fit, abolish the office.
selected and development oriented career administrators who shall provide
In the petition at bench, the legislature has not enacted any law authorizing
competent and faithful service.
the abolition of the CESB. On the contrary, in all the General Appropriations
2. A Career Executive Service hereinafter referred to in this Chapter as the Acts from 1975 to 1993, the legislature has set aside funds for the operation
Board, is created to serve as the governing body of the Career Executive of CESB. Respondent Commission, however, invokes Section 17, Chapter 3,
Service. The Board shall consist of the Chairman of the Civil Service Subtitle A. Title I, Book V of the Administrative Code of 1987 as the source of
Commission as presiding officer, the Executive Secretary and the its power to abolish the CESB. Section 17 provides:
Commissioner of the Budget as ex-officio members and two other members
Sec. 17. Organizational Structure. — Each office of the Commission shall be
from the private sector and/or the academic community who are familiar with
headed by a Director with at least one Assistant Director, and may have such
the principles and methods of personnel administration.
divisions as are necessary independent constitutional body, the Commission
xxx xxx xxx may effect changes in the organization as the need arises.
But as well pointed out by petitioner and the Solicitor General, Section 17 maintenance, security, control and disposal; provide storage and extension
must be read together with Section 16 of the said Code which enumerates the services; and provide and maintain library services.
offices under the respondent Commission, viz:
(7) The Office of Position Classification and Compensation shall formulate and
Sec. 16. Offices in the Commission. — The Commission shall have the implement policies, standards, rules and regulations relative to the
following offices: administration of position classification and compensation.

(1) The Office of the Executive Director headed by an Executive Director, with (8) The Office of Recruitment, Examination and Placement shall provide
a Deputy Executive Director shall implement policies, standards, rules and leadership and assistance in developing and implementing the overall
regulations promulgated by the Commission; coordinate the programs of the Commission programs relating to recruitment, execution and placement, and
offices of the Commission and render periodic reports on their operations, and formulate policies, standards, rules and regulations for the proper
perform such other functions as may be assigned by the Commission. implementation of the Commission's examination and placement programs.

(2) The Merit System Protection Board composed of a Chairman and two (2) (9) The Office of Career Systems and Standards shall provide leadership and
members shall have the following functions: assistance in the formulation and evaluation of personnel systems and
standards relative to performance appraisal, merit promotion, and employee
xxx xxx xxx incentive benefit and awards.

(3) The Office of Legal Affairs shall provide the Chairman with legal advice (10) The Office of Human Resource Development shall provide leadership and
and assistance; render counselling services; undertake legal studies and assistance in the development and retention of qualified and efficient work
researches; prepare opinions and ruling in the interpretation and application force in the Civil Service; formulate standards for training and staff
of the Civil Service law, rules and regulations; prosecute violations of such development; administer service-wide scholarship programs; develop training
law, rules and regulations; and represent the Commission before any court or literature and materials; coordinate and integrate all training activities and
tribunal. evaluate training programs.

(4) The Office of Planning and Management shall formulate development (11) The Office of Personnel Inspection and Audit shall develop policies,
plans, programs and projects; undertake research and studies on the standards, rules and regulations for the effective conduct or inspection and
different aspects of public personnel management; administer management audit personnel and personnel management programs and the exercise of
improvement programs; and provide fiscal and budgetary services. delegated authority; provide technical and advisory services to Civil Service
Regional Offices and government agencies in the implementation of their
(5) The Central Administrative Office shall provide the Commission with
personnel programs and evaluation systems.
personnel, financial, logistics and other basic support services.
(12) The Office of Personnel Relations shall provide leadership and assistance
(6) The Office of Central Personnel Records shall formulate and implement
in the development and implementation of policies, standards, rules and
policies, standards, rules and regulations pertaining to personnel records
regulations in the accreditation of employee associations or organizations and
in the adjustment and settlement of employee grievances and management coordination." This is clearly etched out in Section 38(3), Chapter 7, Book IV
of employee disputes. of the aforecited Code, to wit:

(13) The Office of Corporate Affairs shall formulate and implement policies, (3) Attachment. — (a) This refers to the lateral relationship between the
standards, rules and regulations governing corporate officials and employees department or its equivalent and attached agency or corporation for purposes
in the areas of recruitment, examination, placement, career development, of policy and program coordination. The coordination may be accomplished by
merit and awards systems, position classification and compensation, having the department represented in the governing board of the attached
performing appraisal, employee welfare and benefit, discipline and other agency or corporation, either as chairman or as a member, with or without
aspects of personnel management on the basis of comparable industry voting rights, if this is permitted by the charter; having the attached
practices. corporation or agency comply with a system of periodic reporting which shall
reflect the progress of programs and projects; and having the department or
(14) The Office of Retirement Administration shall be responsible for the its equivalent provide general policies through its representative in the board,
enforcement of the constitutional and statutory provisions, relative to which shall serve as the framework for the internal policies of the attached
retirement and the regulation for the effective implementation of the corporation or agency.
retirement of government officials and employees.
Respondent Commission also relies on the case of Datumanong, et al.,
(15) The Regional and Field Offices. — The Commission shall have not less vs. Civil Service Commission, G. R. No. 114380 where the petition assailing
than thirteen (13) Regional offices each to be headed by a Director, and such the abolition of the CESB was dismissed for lack of cause of action. Suffice to
field offices as may be needed, each to be headed by an official with at least state that the reliance is misplaced considering that the cited case was
the rank of an Assistant Director. dismissed for lack of standing of the petitioner, hence, the lack of cause of
action.
As read together, the inescapable conclusion is that respondent Commission's
power to reorganize is limited to offices under its control as enumerated in IN VIEW WHEREOF, the petition is granted and Resolution No. 93-4359 of the
Section 16, supra. From its inception, the CESB was intended to be an respondent Commission is hereby annulled and set aside. No costs.
autonomous entity, albeit administratively attached to respondent
Commission. As conceptualized by the Reorganization Committee "the CESB SO ORDERED.
shall be autonomous. It is expected to view the problem of building up
executive manpower in the government with a broad and positive
outlook." 6 The essential autonomous character of the CESB is not negated by
its attachment to respondent Commission. By said attachment, CESB was not
made to fall within the control of respondent Commission. Under the
Administrative Code of 1987, the purpose of attaching one functionally inter-
related government agency to another is to attain "policy and program
EN BANC The antecedent facts of the instant case as succinctly related by the Solicitor
General are as follows:
[G.R. No. 112745. October 16, 1997]
On September 18, 1992, [1] a decision was rendered by the Sandiganbayan
AQUILINO T. LARIN, petitioner, vs. THE EXECUTIVE SECRETARY, convicting herein petitioner Aquilino T. Larin, Revenue Specific Tax Officer,
SECRETARY OF FINANCE, COMMISSIONER OF THE BUREAU OF then Assistant Commisioner of the Bureau of Internal Revenue and his co-
INTERNAL REVENUE AND THE COMMITTEE CREATED TO INVESTIGATE accused (except Justino E. Galban, Jr.) of the crimes of violation of Section
THE ADMINISTRATIVE COMPLAINT AGAINST AQUILINO T. LARIN, 268 (4) of the National Internal Revenue Code and Section 3 (e) of R.A. 3019
COMPOSED OF FRUMENCIO A. LAGUSTAN, JOSE B. ALEJANDRINO and in Criminal Cases Nos. 14208-14209, entitled People of the Philippines,
JAIME M. MAZA, respondents. Plaintiff vs. Aquilino T. Larin, Teodoro T. Pareno, Justino E. Galban, Jr. and
Potenciana N. Evangelista, Accused, the dispositive portion of the judgment
DECISION
reads:
TORRES, JR., J.:
"WHEREFORE, judgment is now rendered in Criminal Cases Nos. 14208 and
Challenge in this petition is the validity of petitioners removal from service as 14209 convicting accused Assistant Commissioner for Specific Tax Aquilino T.
Assistant Commissioner of the Excise Tax Service of the Bureau of Internal Larin, Chief of the Alcohol tax Division TEODORO P. PARENO, and Chief of the
Revenue. Incidentally, he questions Memorandum order no. 164 issued by the Revenue accounting Division POTENCIANA M. EVANGELISTA:
Office of the President, which provides for the creation of A Committee to
xxx
Investigate the Administrative Complaint Against Aquilino T. Larin, Assistant
Commissioner, Bureau of Internal Revenue as well as the investigation made SO ORDERED.
in pursuance thereto and Administrative Order No. 101 dated December 2,
1993 which found him guilty of grave misconduct in the administrative charge The fact of petitioners conviction was reported to the President of the
and imposed upon him the penalty of dismissal from office. Philippines by the then Acting Finance Secretary Leong through a
memorandum dated June 4, 1993. The memorandum states, inter alia:
Likewise, petitioner seeks to assail the legality of Executive Order No. 132,
issued by President Ramos on October 26, 1993, which provides for the This is a report in the case of Assistant Commissioner AQUILINO T. LARIN of
Streamlining of the Bureau of Internal Revenue, and of its implementing rules the Excise tax Service, Bureau of Internal Revenue, a presidential appointee,
issued by the Bureau of Internal Revenue, namely: a) Administrative Order one of those convicted in the Criminal Case Nos. 14208-14209, entitled
No. 4-93, which provides for the Organizational Structure and Statement of People of the Philippines vs. Aquilino T. Larin, et. al. Referred to the
General Functions of Offices in the National Office and b) Administrative Order Department of Finace by the Commissioner of Internal Revenue.
No. 5-93, which provides for Redefining the Areas of Jurisdiction and
Renumbering of Regional And District Offices. The cases against Pareno and Evangelista are being acted upon by the Bureau
of Internal revenue as they non-presidential appointees.
xxx The Committee shall convene immediately, conduct the investigation in the
most expeditious manner, and terminate the same as soon as practicable
It is clear from the foregoing that Mr. Larin has found beyond reasonable from its first scheduled date of hearing.
doubt to have committed acts constituting grave misconduct. Under the Civil
Service Laws and Rules which require only preponderance of evidence, grave xxx
misconduct is punishable by dismissal.
Consequently, the Committee directed the petitioner to respond to the
Acting by authority of the President, Sr. Deputy Executive Secretary Leonardo administrative charge leveled against him through a letter dated September
A. Quisumbing issued Memorandum Order No. 164 dated August 25, 1993 17, 1993, thus:
which provides for the creation of an Executive Committee to investigate the
administrative charge against herein petitioner Aquilino T. Larin. It states Presidential Memorandum Order No. 164 dated August 25, 1993, a xerox
thus: copy of which is hereto attached for your ready reference, created an
Investigation Committee to look into the charges against you which are also
A Committee is hereby created to investigate the administrative complaint the subject of the Criminal Cases No. 14208 and 14209 entitled People of the
filed against Aquilino T. Larin, Assistant Commissioner, Bureau of Internal Philippines vs. Aquilino T. Larin, et. al.
Revenue, to be composed of:
The committee has its possession a certified true copy of the Decision of the
Atty. Frumencio A. Lagustan Chairman Sandiganbayan in the above-mentioned cases.

Assistant Executive Secretary for Legislation Pursuant to Presidential Memorandum Order No. 164, you are hereby directed
to file your position paper on the aforementioned charges within seven (7)
Mr. Jose B. Alejandro Member days from receipt hereof xxx.

Presidential Assistant Failure to file the required position paper shall be considered as a waiver on
your part to submit such paper or to be heard, in which case, the Committee
Atty. Jaime M. Maza Member
shall deem the case submitted on the basis of the documents and records at
Assistant commissioner of Inspector services hand.

Bureau of Internal Revenue In compliance, petitioner submitted a letter dated September 30, 1993 which
was addressed to Atty. Frumencio A. Lagustan , the Chairman of the
The Committee shall have the powers and prerogatives of (an) investigating Investigating Committee. In said latter, he asserts that,
committee under the administrative Code of 1987 including the power to
summon witnesses, administer oath or take testimony or evidence relevant to The case being sub-judice, I may not , therefore, comment on the merits of
the investigation by subpoena ad testificandum and subpoena duces tecum: issues involved for fear of being cited in contempt of Court. This position
paper is thus limited to furnishing the Committee pertinent documents
xxx
submitted with the Supreme Court and other tribunal which took cognizance 1. Bernardo A. Frianeza
of the case in the past, as follows:
2. Dominador L. Galura
xxx
3. Jaime D. Gonzales
The foregoing documents readily show that I am not administratively liable or
criminally culpable of the charges leveled against me, and that the aforesaid 4. Lilia C. Guillermo
cases are mere prosecutions caused to be filed and are being orchestrated by
5. Rizalina S. Magalona
taxpayers who were prejudiced by multi-million peso assessments I caused to
be issued against them in my official capacity as Assistant Commissioner, 6. Victorino C. Mamalateo
Excise Tax office of Bureau of Internal Revenue.
7. Jaime M. Masa
In the same letter, petitioner claims that the administrative complaint against
him is already barred: a) on jurisdictional ground as the Office of the 8. Antonio N. Pangilinan
Ombudsman had already taken cognizance of the case and had caused the
9. Melchor S. Ramos
filing only of the criminal charges against him, b) by res judicata, c) double
jeopardy, and d) because to proceed with the case would be redundant, 10. Joel L. Tan-Torres
oppressive and a plain persecution against him.
Consequently, the president, in the assailed Administrative Order No. 101
Meanwhile, the President issued the challenged Executive order No. 132 dated dated December 2, 1993, found petitioner guilty of grave misconduct in the
October 26, 1993 which mandates for the streamlining of the Bureau of administrative charge and imposed upon him the penalty of dismissal with
Internal Revenue. Under said order, some positions and functions are either forfeiture of his leave credits and retirement benefits including disqualification
abolished, renamed, decentralized or transferred to other offices, while other for reappointment in the government service.
offices are also created. The Excise Tax Service or the Specific Tax Service, of
which petitioner was the Assistant Commissioner, was one of those offices Aggrieved, petitioner filed directly with this Court the instant petition on
that was abolished by said executive order. December 13, 1993 to question basically his alleged unlawful removal from
office.
The corresponding implementing rules of Executive Order No. 132, namely,
revenue Administrative Orders Nos. 4-93 and 5-93, were subsequently issued On April 17, 1996 and while the instant petition is pending, this Court set
.by the Bureau of Internal Revenue. aside the conviction of the petitioner in Criminal Case Nos. 14208 and 14209.

On October 27, 1993, or one day after the promulgation of Executive Order In his petition, petitioner challenged the authority of the President to dismiss
No.132, the President appointed the following as BIR Assistant him from office. He argued that in so far as presidential appointees who are
Commissioners: Career Executive Service Officers are concerned, the President exercises only
the power of control not the power to remove. He also averred that the
administrative investigation conducted under Memorandum Order No. 164 is was found guilty of grave misconduct in the administrative cases filed against
void as it violated his right to due process. According to him, the letter of the him.
Committee dated September 17, 1993 and his position paper dated
September 30, 1993 are not sufficient for purposes of complying with the The ultimate issue to be resolved in the instant case falls on the
requirements of due process. He alleged that he was not informed of the determination of the validity of petitioners dismissal from office. Incidentally,
administrative charges leveled against him nor was he given official notice of in order to resolve this matter, it is imperative that We consider these
his dismissal. questions : a) Who has the power to discipline the petitioner?, b) Were the
proceedings taken pursuant to Memorandum Order No. 164 in accord with
Petitioner likewise claimed that he was removed as a result of the due process?, c) What is the effect of petitioners acquittal in the criminal case
reorganization made by the Executive Department in the BIR pursuant to to his administrative charge? d) Does the President have the power to
Executive Order No. 132. Thus, he assailed said Executive Order No. 132 and reorganize the BIR or to issue the questioned E.O. NO. 132?, e) Is the
its implementing rules, namely, Revenue Administrative Orders 4-93 and 5- reorganization of BIR pursuant to E.O. No. 132 tainted with bad faith?
93 for being ultra vires. He claimed that there is yet no law enacted by
Congress which authorizes the reorganization by the Executive Department of At the outset, it is worthy to note that the position of the Assistant
executive agencies, particularly the Bureau of Internal revenue. He said that Commissioner of the BIR is part of the Career Executive Service.[2] Under the
the reorganization sought to be effected by the Executive Department on the law,[3] Career Executive Service officers, namely Undersecretary, Assistant
basis of E.O. No. 132 is tainted with bad faith in apparent violation of Section Secretary, Bureau director, Assistant Bureau Director, Regional Director,
2 of R.A. 6656, otherwise known as the Act Protecting the Security of Tenure Assistant Regional Director, Chief of Department Service and other officers of
of Civil Service Officers and Employees in the Implementation of Government equivalent rank as may be identified by the Career Executive Service Board,
Reorganization. are all appointed by the President. Concededly, petitioner was appointed as
Assistant Commissioner in January, 1987 by then President Aquino. Thus,
On the other hand, respondents contended that since petitioner is the petitioner is a presidential appointee who belongs to career service of the Civil
presidential appointee, he falls under the disciplining authority of the Service. Being a presidential appointee, he comes under the direct diciplining
President. They also contended that E.O. No. 132 and its implementing rules authority of the President. This is in line with the well settled principle that
were validly issued pursuant to Sections 48 and 62 of Republic Act No. 7645. the power to remove is inherent in the power to appoint conferred to the
Apart from this, the other legal bases of E.O. No. 132 as stated in its President by Section 16, Article VII of the Constitution. Thus, it is ineluctably
preamble are Section 63 of E.O No.127 (Reorganizing the Ministry of clear that Memorandum Order No. 164, which created a committee to
Finance), and Section 20, Book III of E.O. No. 292, otherwise known as the investigate the administrative charge against petitioner, was issued pursuant
Administrative Code of 1987. In addition, it is clear that in Section 11 of R.A to the power of removal of the President. This power of removal, however, is
No.6656 future reorganization is expressly contemplated and nothing in said not an absolute one which accepts no reservation. It must be pointed out that
law that prohibits subsequent reorganization through an executive order. petitioner is a career service officer. Under the Administrative Code of 1987,
Significantly, respondents clarified that petitioner was not dismissed by virtue career service is characterized by the existence of security of tenure, as
of EO 132. Respondents claimed that he was removed from office because he contra-distinguished from non-career service whose tenure is co-terminus
with that of the appointing or subject to his pleasure, or limited to a period
specified by law or to the duration of a particular project for which purpose Sandiganbayan convicting Larin, et. al. in Criminal Cases No. 14208 and
the employment was made. As a career service officer, petitioner enjoys the 14209."[4]
right to security of tenure. No less than the 1987 Constitution guarantees the
right of security of tenure of the employees of the civil service. Specifically, In a nutshell, the criminal cases against petitioner refer to his alleged
Section 36 of P.D. No. 807, as amended, otherwise known as Civil Service violation of Section 268 (4) of the National Internal Revenue Code and of
Decree of the Philippines, is emphatic that career service officers and section 3(e) of R.A. No.3019 as a consequence of his act of favorably
employees who enjoy security of tenure may be removed only for any of the recommending the grant of tax credit to Tanduay Distillery, Inc.. The
causes enumerated in said law. In other words, the fact that the petitioner is pertinent portion of the judgment of the Sandiganbayan reads:
a presidential appointee does not give the appointing authority the license to
"As above pointed out, the accused had conspired in knowingly preparing
remove him at will or at his pleasure for it is an admitted fact that he is
false memoranda and certification in order to effect a fraud upon taxes due to
likewise a career service officer who under the law is the recipient of
the government. By their separate acts which had resulted in an appropriate
tenurialprotection, thus, may only be removed for a cause and in accordance
tax credit of P180,701,682.00 in favor of Tanduay. The government had been
with procedural due process.
defrauded of a tax revenue - for the full amount, if one is to look at the
Was petitioner then removed from office for a legal cause under a valid availments or utilization thereof (Exhibits 'AA' to 'AA-31-a'), or for a
proceeding? substantial portion thereof (P73,000,000.00) if we are to rely on the letter of
Deputy Commissioner Eufracio D. Santos (Exhibits '21' for all the accused).
Although the proceedings taken complied with the requirements of procedural
due process, this Court, however, considers that petitioner was not dismissed As pointed out above, the confluence of acts and omissions committed by
for a valid cause. accused Larin, Pareno and Evangelista adequately prove conspiracy among
them for no other purpose than to bring about a tax credit which Tanduay did
It should be noted that what precipitated the creation of the investigative not deserve. These misrepresentations as to how much Tanduay had paid in
committee to look into the administrative charge against petitioner is his ad valorem taxes obviously constituted a fraud of tax revenue of the
conviction by the Sandiganbayan in criminal Case Nos. 14208 and 14209. As government xxx.'[5]
admitted by the respondents, the administrative case against petitioner is
based on the Sandiganbayan Decision of September 18, 1992. Thus, in the However, it must be stressed at this juncture that the conviction of petitioner
Administrative Order No. 101 issued by Senior Deputy Executive Secretary by the Sandiganbayan was set aside by this court in our decision
Quisumbing which found petitioner guilty of grave misconduct, it clearly promulgated on April 17, 1996 in G.R. Nos. 108037-38 and 107119-20. We
states that: specifically ruled in no uncertain terms that : a) petitioner cannot be held
negligent in relying on the certification of a co-equal unit in the BIR, b) it is
"This pertains to the administrative charge against Assistant Commissioner not incumbent upon Larin to go beyond the certification made by the Revenue
Aquilino T. Larin of the Bureau of Internal Revenue, for grave misconduct by Accounting Division that Tanduay Distillery, Inc. had paid the ad valorem
virtue of a Memorandum signed by Acting Secretary Leong of the Department taxes, c) there is nothing irregular or anything false in Larin's marginal note
of Finance, on the basis of decision handed down by the Hon. on the memorandum addressed to Pareno, the Chief of Alcohol Tax Division
who was also one of the accused, but eventually acquitted, in the said 1993 to the administrative charged filed against him. Aside from his letter, he
criminal cases, and d) there is no proof of actual agreement between the also submitted various documents attached as annexes to his letter, all of
accused, including petitioner, to commit the illegal acts charged. We are which are evidences supporting his defense. Prior to this, he received a letter
emphatic in our resolution in said cases that there is nothing "illegal with the dated September 17, 1993 from the Investigation Committee requiring him to
acts committed by the petitioner(s)." We also declare that "there is no explain his side concerning the charge. It cannot therefore be argued that
showing that petitioner(s) had acted irregularly, or performed acts outside of petitioner was denied of due process.
his (their) official functions." Significantly, these acts which We categorically
declare to be not unlawful and improper in G.R. Nos. 108037-38 and G.R. Let us now examine Executive Order No. 132.
Nos. 107119-20 are the very same acts for which petitioner is held to be
As stated earlier, with the issuance of Executive Order No. 132, some of the
administratively responsible. Any charge of malfeasance or misfeasance on
positions and offices, including the office of Excise Tax Services of which
the part of the petitioner is clearly belied by our conclusion in said cases. In
petitioner was the Assistant Commissioner, were abolished or otherwise
the light of this decisive pronouncement, We see no reason for the
decentralized. Consequently, the President released the list of appointed
administrative charge to continue - it must, thus, be dismissed.
Assistant Commissioners of the BIR. Apparently, petitioner was not included.
We are not unaware of the rule that since administrative cases are
Initially, it is argued that there is no law yet which empowers the President to
independent from criminal actions for the same act or omission, the dismissal
issue E.O. No. 132 or to reorganize the BIR.
or acquittal of the criminal charge does not foreclose the institution of
administrative action nor carry with it the relief from administrative liability. We do not agree.
[6]
However, the circumstantial setting of the instant case sets it miles apart
from the foregoing rule and placed it well within the exception. Corollarily, Under its Preamble, E.O. No. 132 lays down the legal basis of its issuance,
where the very basis of the administrative case against petitioner is his namely: a) Section 48 and 62 of R.A. No. 7645, b) Section 63 of E.O. No.
conviction in the criminal action which was later on set aside by this court 127, and c) Section 20, Book III of E.O. No. 292.
upon a categorical and clear findings that the acts for which he was
Section 48 of R.A. 7645 provides that:
administratively held liable are not unlawful and irregular, the acquittal of the
petitioner in the criminal case necessarily entails the dismissal of the "Sec. 48. Scaling Down and Phase Out of Activities of Agencies Within the
administrative action against him, because in such a case, there is no basis Executive Branch. -- The heads of departments, bureaus and offices and
nor justifiable reason to maintain the administrative suit. agencies are hereby directed to identify their respective activities which are
no longer essential in the delivery of public services and which may be scaled
On the aspect of procedural due process, suffice it to say that petitioner was
down, phased out or abolished, subject to civil rules and regulations.
given every chance to present his side. The rule is well settled that the
xxx. Actual scaling down, phasing out or abolition of the activities shall
essence of due process in administrative proceedings is that a party be
be effective pursuant to Circulars or Orders issued for the purpose by the
afforded a reasonable opportunity to be heard and to submit any evidence he
Office of the President." (italics ours)
may have in support of his defense.[7] The records clearly show that on
October 1, 1993 petitioner submitted his letter-response dated September 30,
Said provision clearly mentions the acts of "scaling down, phasing out and group, consolidate bureaus and agencies, to abolish offices, to transfer
abolition" of offices only and does not cover the creation of offices or transfer functions, to create and classify functions, services and activities and to
of functions. Nevertheless, the act of creating and decentralizing is included in standardize salaries and materials. The validity of these two decrees are
the subsequent provision of Section 62, which provides that: unquestionable. The 1987 Constitution clearly provides that "all laws,
decrees, executive orders, proclamations, letters of instructions and other
"Sec. 62, Unauthorized Organizational Charges. -- Unless otherwise created executive issuances not inconsistent with this Constitution shall remain
by law or directed by the President of the Philippines, no organizational unit operative until amended, repealed or revoked."[10] So far, there is yet no law
or changes in key positions in any department or agency shall be authorized amending or repealing said decrees. Significantly, the Constitution itself
in their respective organization structures and be funded from appropriations recognizes future reorganizations in the government as what is revealed in
by this Act." (italics ours) Section 16 of Article XVIII, thus:

The foregoing provision evidently shows that the President is authorized to "Sec. 16. Career civil service employees separated from service not for cause
effect organizational changes including the creation of offices in the but as a result of the xxx reorganization following the ratification of this
department or agency concerned. Constitution shall be entitled to appropriate separation pay xxx."

The contention of petitioner that the two provisions are riders deserves scant However, We can not consider E.O. No. 127 signed on January 30, 1987 as a
consideration. Well settled is the rule that every law has in its favor the legal basis for the reorganization of the BIR. E.O. No. 127 should be related
presumption of constitutionality.[8]Unless and until a specific provision of the to the second paragraph of Section 11 of Republic Act No. 6656.
law is declared invalid and unconstitutional, the same is valid and binding for
all intents and purposes. Section 11 provides inter alia:

Another legal basis of E.O. No. 132 is Section 20, Book III of E.O. No. 292 "xxx
which states:
In the case of the 1987 reorganization of the executive branch, all
"Sec.20. Residual Powers. -- Unless Congress provides otherwise, the departments and agencies which are authorized by executive orders
President shall exercise such other powers and functions vested in the promulgated by the President to reorganize shall have ninety days from the
President which are provided for under the laws and which are not approval of this act within which to implement their respective reorganization
specifically enumerated above or which are not delegated by the President in plans in accordance with the provisions of this Act." (italics ours)
accordance with law." (italics ours)
Executive Order No. 127 was part of the 1987 reorganization contemplated
This provision speaks of such other powers vested in the President under the under said provision. Obviously, it had become stale by virtue of the
law. What law then which gives him the power to reorganize? It is Presidential expiration of the ninety day deadline period. It can not thus be used as a
Decree No. 1772[9] which amended Presidential Decree No. 1416. These proper basis for the reorganization of the BIR. Nevertheless, as shown earlier,
decrees expressly grant the President of the Philippines the continuing there are other legal bases to sustain the authority of the President to issue
authority to reorganize the national government, which includes the power to the questioned E.O. No. 132.
While the President's power to reorganize can not be denied, this does not b) Where an office is abolished and another performing substantially the same
mean however that the reorganization itself is properly made in accordance functions is created;
with law. Well-settled is the rule that reorganization is regarded as valid
provided it is pursued in good faith. Thus, in Dario vs. Mison, this court has c) Where incumbents are replaced by those less qualified in terms of status of
had the occasion to clarify that: appointment, performance and merit;

"As a general rule, a reorganization is carried out in good faith if it is for the d) Where there is a reclassification of offices in the department or agency
purpose of economy or to make bureaucracy more efficient. In that event no concerned and the reclassified offices perform substantially the same
dismissal or separation actually occurs because the position itself ceases to functions as the original offices;
exist. And in that case the security of tenure would not be a Chinese Wall. Be
e) Where the removal violates the order of separation provided in Section 3
that as it may, if the abolition which is nothing else but a separation or
hereof."
removal, is done for political reasons or purposely to defeat security of
tenure, or otherwise not in good faith, no valid abolition takes place and A reading of some of the provisions of the questioned E.O. No. 132 clearly
whatever abolition is done is void ab initio. There is an invalid abolition as leads us to an inescapable conclusion that there are circumstances considered
where there is merely a change of nomenclature of positions or where claims as evidences of bad faith in the reorganization of the BIR.
of economy are belied by the existence of ample funds."[11]
Section 1.1.2 of said executive order provides that:
In this regard, it is worth mentioning that Section 2 of R.A. No. 6656 lists
down the circumstances evidencing bad faith in the removal of employees as "1.1.2 The Intelligence and Investigation Office and the Inspection Service
a result of the reorganization, thus: are abolished. An Intelligence and Investigation Service is hereby created to
absorb the same functions of the abolished office and service. xxx" (italics
Sec. 2. No officer or employee in the career service shall be removed except ours)
for a valid cause and after due notice and hearing. A valid cause for removal
exist when, pursuant to a bona fide reorganization, a position has been This provision is a clear illustration of the circumstance mentioned in Section
abolished or rendered redundant or there is a need to merge, divide, or 2 (b) of R.A. No. 6656 that an office is abolished and another one performing
consolidate positions in order to meet the exigencies of the service, or other substantially the same function is created.
lawful causes allowed by the Civil Service Law. The existence of any or some
Another circumstance is the creation of services and divisions in the BIR
of the following circumstances may be considered as evidence of bad faith in
resulting to a significant increase in the number of positions in the said
the removals made as a result of the reorganization, giving rise to a claim for
bureau as contemplated in paragraph (a) of section 2 of R.A. No. 6656. Under
reinstatement or reappointment by an aggrieved party:
Section 1.3 of E.O. No. 132, the Information Systems Group has two newly
a) Where there is a significant increase in the number of positions in the new created Systems Services. Aside from this, six new divisions are also created.
staffing pattern of the department or agency concerned; Under Section 1.2.1, three more divisions of the Assessment Service are
formed. With this newly created offices, there is no doubt that a significant
increase of positions will correspondingly follow.

Furthermore, it is perceivable that the non-reappointment of the petitioner as


Assistant Commissioner violates Section 4 of R.A. No. 6656. Under said
provision, officers holding permanent appointments are given preference for
appointment to the new positions in the approved staffing pattern comparable
to their former position or in case there are not enough comparable positions
to positions next lower in rank. It is undeniable that petitioner is a career
executive officer who is holding a permanent position. Hence, he should have
given preference for appointment in the position of Assistant Commissioner.
As claimed by petitioner, Antonio Pangilinan who was one of those appointed
as Assistant Commissioner, "is an outsider of sorts to the bureau, not having
been an incumbent officer of the bureau at the time of the reorganization."
We should not lose sight of the second paragraph of Section 4 of R.A. No.
6656 which explicitly states that no new employees shall be taken in until all
permanent officers shall have been appointed for permanent position.

IN VIEW OF THE FOREGOING, the petition is granted, and petitioner is


hereby reinstated to his position as Assistant Commissioner without loss of
seniority rights and shall be entitled to full backwages from the time of his
separation from service until actual reinstatement unless, in the meanwhile,
he would have reached the compulsory retirement age of sixty-five years in
which case, he shall be deemed to have retired at such age and entitled
thereafter to the corresponding retirement benefits.

SO ORDERED.