G.R. No.
120319 October 6, 1995 compulsory arbitration, such a third party is normally appointed by the
LUZON DEVELOPMENT BANK, petitioner,
vs.
ASSOCIATION OF LUZON DEVELOPMENT BANK EMPLOYEES and ATTY.
ESTER S. GARCIA in her capacity as VOLUNTARY
ARBITRATOR, respondents.
ROMERO, J.:
From a submission agreement of the Luzon Development Bank (LDB) and the
Association of Luzon Development Bank Employees (ALDBE) arose an arbitration
case to resolve the following issue:
Whether or not the company has violated the Collective Bargaining
Agreement provision and the Memorandum of Agreement dated April
1994, on promotion.
At a conference, the parties agreed on the submission of their respective Position
Papers on December 1-15, 1994. Atty. Ester S. Garcia, in her capacity as
Voluntary Arbitrator, received ALDBE's Position Paper on January 18, 1995. LDB,
on the other hand, failed to submit its Position Paper despite a letter from the
Voluntary Arbitrator reminding them to do so. As of May 23, 1995 no Position
Paper had been filed by LDB.
On May 24, 1995, without LDB's Position Paper, the Voluntary Arbitrator rendered
a decision disposing as follows:
WHEREFORE, finding is hereby made that the Bank has not adhered to the
Collective Bargaining Agreement provision nor the Memorandum of
Agreement on promotion.
Hence, this petition for certiorari and prohibition seeking to set aside the decision
of the Voluntary Arbitrator and to prohibit her from enforcing the same.
In labor law context, arbitration is the reference of a labor dispute to an impartial
third person for determination on the basis of evidence and arguments presented
by such parties who have bound themselves to accept the decision of the
arbitrator as final and binding.
Arbitration may be classified, on the basis of the obligation on which it is based, as
either compulsory or voluntary.
Compulsory arbitration is a system whereby the parties to a dispute are compelled
by the government to forego their right to strike and are compelled to accept the
resolution of their dispute through arbitration by a third party. The essence of
arbitration remains since a resolution of a dispute is arrived at by resort to a
disinterested third party whose decision is final and binding on the parties, but in
government.
Under voluntary arbitration, on the other hand, referral of a dispute by the parties
is made, pursuant to a voluntary arbitration clause in their collective agreement, to
an impartial third person for a final and binding resolution. Ideally, arbitration
awards are supposed to be complied with by both parties without delay, such that
once an award has been rendered by an arbitrator, nothing is left to be done by
both parties but to comply with the same. After all, they are presumed to have
freely chosen arbitration as the mode of settlement for that particular dispute.
Pursuant thereto, they have chosen a mutually acceptable arbitrator who shall
hear and decide their case. Above all, they have mutually agreed to de bound by
said arbitrator's decision.
In the Philippine context, the parties to a Collective Bargaining Agreement (CBA)
are required to include therein provisions for a machinery for the resolution of
grievances arising from the interpretation or implementation of the CBA or
company personnel policies. For this purpose, parties to a CBA shall name and
designate therein a voluntary arbitrator or a panel of arbitrators, or include a
procedure for their selection, preferably from those accredited by the National
Conciliation and Mediation Board (NCMB). Article 261 of the Labor Code
accordingly provides for exclusive original jurisdiction of such voluntary arbitrator
or panel of arbitrators over (1) the interpretation or implementation of the CBA and
(2) the interpretation or enforcement of company personnel policies. Article 262
authorizes them, but only upon agreement of the parties, to exercise jurisdiction
over other labor disputes.
On the other hand, a labor arbiter under Article 217 of the Labor Code has
jurisdiction over the following enumerated cases:
. . . (a) Except as otherwise provided under this Code the Labor Arbiters
shall have original and exclusive jurisdiction to hear and decide, within thirty
(30) calendar days after the submission of the case by the parties for
decision without extension, even in the absence of stenographic notes, the
following cases involving all workers, whether agricultural or non-
agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that workers
may file involving wages, rates of pay, hours of work and other terms and
conditions of employment;
4. Claims for actual, moral, exemplary and other forms of damages arising
from the employer-employee relations;
 5. Cases arising from any violation of Article 264 of this Code, including
questions involving the legality of strikes and lockouts;
6. Except claims for Employees Compensation, Social Security, Medicare
and maternity benefits, all other claims, arising from employer-employee
relations, including those of persons in domestic or household service,
involving an amount exceeding five thousand pesos (P5,000.00) regardless
of whether accompanied with a claim for reinstatement.
xxx xxx xxx
It will thus be noted that the jurisdiction conferred by law on a voluntary arbitrator
or a panel of such arbitrators is quite limited compared to the original jurisdiction
of the labor arbiter and the appellate jurisdiction of the National Labor Relations
Commission (NLRC) for that matter. The state of our present law relating to
voluntary arbitration provides that "(t)he award or decision of the Voluntary
Arbitrator . . . shall be final and executory after ten (10) calendar days from receipt
of the copy of the award or decision by the parties, while the (d)ecision, awards, or
orders of the Labor Arbiter are final and executory unless appealed to the
Commission by any or both parties within ten (10) calendar days from receipt of
such decisions, awards, or orders. Hence, while there is an express mode of
appeal from the decision of a labor arbiter, Republic Act No. 6715 is silent with
respect to an appeal from the decision of a voluntary arbitrator.
Yet, past practice shows that a decision or award of a voluntary arbitrator is, more
often than not, elevated to the Supreme Court itself on a petition for certiorari, in
effect equating the voluntary arbitrator with the NLRC or the Court of Appeals. In
the view of the Court, this is illogical and imposes an unnecessary burden upon it.
In Volkschel Labor Union, et al. v. NLRC, et al., on the settled premise that the
judgments of courts and awards of quasi-judicial agencies must become final at
some definite time, this Court ruled that the awards of voluntary arbitrators
determine the rights of parties; hence, their decisions have the same legal effect
as judgments of a court. In Oceanic Bic Division (FFW), et al. v. Romero, et
al., this Court ruled that "a voluntary arbitrator by the nature of her functions acts
in a quasi-judicial capacity." Under these rulings, it follows that the voluntary
arbitrator, whether acting solely or in a panel, enjoys in law the status of a quasi-
judicial agency but independent of, and apart from, the NLRC since his decisions
are not appealable to the latter.
Section 9 of B.P. Blg. 129, as amended by Republic Act No. 7902, provides that
the Court of Appeals shall exercise:
xxx xxx xxx
(B) Exclusive appellate jurisdiction over all final judgments, decisions,
resolutions, orders or awards of Regional Trial Courts and quasi-judicial
agencies, instrumentalities, boards or commissions, including the Securities
and Exchange Commission, the Employees Compensation Commission
and the Civil Service Commission, except those falling within the appellate
jurisdiction of the Supreme Court in accordance with the Constitution, the
Labor Code of the Philippines under Presidential Decree No. 442, as
amended, the provisions of this Act, and of subparagraph (1) of the third
paragraph and subparagraph (4) of the fourth paragraph of Section 17 of
the Judiciary Act of 1948.
xxx xxx xxx
Assuming arguendo that the voluntary arbitrator or the panel of voluntary
arbitrators may not strictly be considered as a quasi-judicial agency, board or
commission, still both he and the panel are comprehended within the concept of a
"quasi-judicial instrumentality." It may even be stated that it was to meet the very
situation presented by the quasi-judicial functions of the voluntary arbitrators here,
as well as the subsequent arbitrator/arbitral tribunal operating under the
Construction Industry Arbitration Commission, that the broader term
"instrumentalities" was purposely included in the above-quoted provision.
An "instrumentality" is anything used as a means or agency. Thus, the terms
governmental "agency" or "instrumentality" are synonymous in the sense that
either of them is a means by which a government acts, or by which a certain
government act or function is performed. The word "instrumentality," with respect
to a state, contemplates an authority to which the state delegates governmental
power for the performance of a state function. An individual person, like an
administrator or executor, is a judicial instrumentality in the settling of an estate, in
the same manner that a sub-agent appointed by a bankruptcy court is an
instrumentality of the court, and a trustee in bankruptcy of a defunct corporation is
an instrumentality of the state.
The voluntary arbitrator no less performs a state function pursuant to a
governmental power delegated to him under the provisions therefor in the Labor
Code and he falls, therefore, within the contemplation of the term "instrumentality"
in the aforequoted Sec. 9 of B.P. 129. The fact that his functions and powers are
provided for in the Labor Code does not place him within the exceptions to said
Sec. 9 since he is a quasi-judicial instrumentality as contemplated therein. It will
be noted that, although the Employees Compensation Commission is also
provided for in the Labor Code, Circular No. 1-91, which is the forerunner of the
present Revised Administrative Circular No. 1-95, laid down the procedure for the
appealability of its decisions to the Court of Appeals under the foregoing
rationalization, and this was later adopted by Republic Act No. 7902 in amending
Sec. 9 of B.P. 129.
A fortiori, the decision or award of the voluntary arbitrator or panel of arbitrators
should likewise be appealable to the Court of Appeals, in line with the procedure
outlined in Revised Administrative Circular No. 1-95, just like those of the quasi-
judicial agencies, boards and commissions enumerated therein.
This would be in furtherance of, and consistent with, the original purpose of
Circular No. 1-91 to provide a uniform procedure for the appellate review of
adjudications of all quasi-judicial entities not expressly excepted from the
coverage of Sec. 9 of B.P. 129 by either the Constitution or another statute. Nor
will it run counter to the legislative intendment that decisions of the NLRC be
reviewable directly by the Supreme Court since, precisely, the cases within the
adjudicative competence of the voluntary arbitrator are excluded from the
jurisdiction of the NLRC or the labor arbiter.
In the same vein, it is worth mentioning that under Section 22 of Republic Act No.
876, also known as the Arbitration Law, arbitration is deemed a special
proceeding of which the court specified in the contract or submission, or if none be
specified, the Regional Trial Court for the province or city in which one of the
parties resides or is doing business, or in which the arbitration is held, shall have
jurisdiction. A party to the controversy may, at any time within one (1) month after
an award is made, apply to the court having jurisdiction for an order confirming the
award and the court must grant such order unless the award is vacated, modified
or corrected.
In effect, this equates the award or decision of the voluntary arbitrator with that of
the regional trial court. Consequently, in a petition for certiorari from that award or
decision, the Court of Appeals must be deemed to have concurrent jurisdiction
with the Supreme Court. As a matter of policy, this Court shall henceforth remand
to the Court of Appeals petitions of this nature for proper disposition.
ACCORDINGLY, the Court resolved to REFER this case to the Court of Appeals.
SO ORDERED.
Padilla, Regalado, Davide, Jr., Bellosillo, Puno, Vitug, Kapunan, Mendoza,
Francisco and Hermosisima, Jr., JJ., concur.
Feliciano, J., concurs in the result.
Narvasa, C.J. and Melo, J. are on leave.
Footnotes
1 Seide, A Dictionary of Arbitration (1970).
2 Ibid.
3 Art. 260, Labor Code.
4 Art. 217, Labor Code.
5 Art. 262-A, par. 4, Labor Code.
6 Art. 223, Labor Code.
7 Oceanic Bic Division (FFW), et al. v. Romero, et al., 130 SCRA 392 (1984);
Sime Darby Pilipinas, Inc. v. Magsalin, et al., 180 SCRA 177 (1989).
8 98 SCRA 314 (1980).
9 Supra.
10 Art. 262-A, in relation to Art. 217 (b) and (c), Labor Code, as amended by
Sec. 9, R.A. 6715.
11 Executive Order No. 1008.
12 Laurens Federal Sav. and Loan Ass'n v. South Carolina Tax
Commission, 112 S.E. 2d 716, 719, 236 S.C. 2.
13 Govt. of P.I. v. Springer, et al., 50 Phil. 259, 334 (1927).
14 Ciulla v. State, 77 N.Y.S. 2d 545, 550, 191 Misc. 528.
15 In re Turncock's Estate, 300 N.W. 155, 156, 238 Wis. 438.
16 In re Brown Co., D.C. Me., 36 F. Supp. 275, 277.
17 Gagne v. Brush, D.C.N.H., 30 F. Supp. 714, 716.
18 First Lepanto Ceramics, Inc. v. CA, et al., 231 SCRA 30 (1994).
19 Section 23, R.A. No. 876.
G.R. No. 102976 October 25, 1995
IRON AND STEEL AUTHORITY, petitioner,
vs.
THE COURT OF APPEALS and MARIA CRISTINA FERTILIZER
CORPORATION, respondents.
FELICIANO, J.:
Petitioner Iron and Steel Authority ("ISA") was created by Presidential Decree
(P.D.) No. 272 dated 9 August 1973 in order, generally, to develop and promote
the iron and steel industry in the Philippines. The objectives of the ISA are spelled
out in the following terms:
Sec. 2. Objectives — The Authority shall have the following objectives:
(a) to strengthen the iron and steel industry of the Philippines and to
expand the domestic and export markets for the products of the industry;
(b) to promote the consolidation, integration and rationalization of the
industry in order to increase industry capability and viability to service the
domestic market and to compete in international markets;
(c) to rationalize the marketing and distribution of steel products in order to
achieve a balance between demand and supply of iron and steel products
for the country and to ensure that industry prices and profits are at levels
that provide a fair balance between the interests of investors, consumers
suppliers, and the public at large;
(d) to promote full utilization of the existing capacity of the industry, to
discourage investment in excess capacity, and in coordination, with
appropriate government agencies to encourage capital investment in
priority areas of the industry;
(e) to assist the industry in securing adequate and low-cost supplies of raw
materials and to reduce the excessive dependence of the country on
imports of iron and steel.
 The list of powers and functions of the ISA included the following:
Sec. 4. Powers and Functions. — The authority shall have the following
powers and functions:
xxx xxx xxx
(j) to initiate expropriation of land required for basic iron and steel facilities
for subsequent resale and/or lease to the companies involved if it is shown
that such use of the State's power is necessary to implement the
construction of capacity which is needed for the attainment of the objectives
of the Authority;
xxx xxx xxx
(Emphasis supplied)
P.D. No. 272 initially created petitioner ISA for a term of five (5) years counting
from 9 August 1973. When ISA's original term expired on 10 October 1978, its
term was extended for another ten (10) years by Executive Order No. 555 dated
31 August 1979.
The National Steel Corporation ("NSC") then a wholly owned subsidiary of the
National Development Corporation which is itself an entity wholly owned by the
National Government, embarked on an expansion program embracing, among
other things, the construction of an integrated steel mill in Iligan City. The
construction of such a steel mill was considered a priority and major industrial
project of the Government. Pursuant to the expansion program of the NSC,
Proclamation No. 2239 was issued by the President of the Philippines on 16
November 1982 withdrawing from sale or settlement a large tract of public land
(totalling about 30.25 hectares in area) located in Iligan City, and reserving that
land for the use and immediate occupancy of NSC.
Since certain portions of the public land subject matter Proclamation No. 2239
were occupied by a non-operational chemical fertilizer plant and related facilities
owned by private respondent Maria Cristina Fertilizer Corporation ("MCFC"),
Letter of Instruction (LOI), No. 1277, also dated 16 November 1982, was issued
directing the NSC to "negotiate with the owners of MCFC, for and on behalf of the
Government, for the compensation of MCFC's present occupancy rights on the
subject land." LOI No. 1277 also directed that should NSC and private respondent
MCFC fail to reach an agreement within a period of sixty (60) days from the date
of LOI No. 1277, petitioner ISA was to exercise its power of eminent domain under
P.D. No. 272 and to initiate expropriation proceedings in respect of occupancy
rights of private respondent MCFC relating to the subject public land as well as
the plant itself and related facilities and to cede the same to the NSC.
Negotiations between NSC and private respondent MCFC did fail. Accordingly, on
18 August 1983, petitioner ISA commenced eminent domain proceedings against
private respondent MCFC in the Regional Trial Court, Branch 1, of Iligan City,
praying that it (ISA) be places in possession of the property involved upon
depositing in court the amount of P1,760,789.69 representing ten percent (10%)
of the declared market values of that property. The Philippine National Bank, as
mortgagee of the plant facilities and improvements involved in the expropriation
proceedings, was also impleaded as party-defendant.
On 17 September 1983, a writ of possession was issued by the trial court in favor
of ISA. ISA in turn placed NSC in possession and control of the land occupied by
MCFC's fertilizer plant installation.
The case proceeded to trial. While the trial was ongoing, however, the statutory
existence of petitioner ISA expired on 11 August 1988. MCFC then filed a motion
to dismiss, contending that no valid judgment could be rendered against ISA
which had ceased to be a juridical person. Petitioner ISA filed its opposition to this
motion.
In an Order dated 9 November 1988, the trial court granted MCFC's motion to
dismiss and did dismiss the case. The dismissal was anchored on the provision of
the Rules of Court stating that "only natural or juridical persons or entities
authorized by law may be parties in a civil case court also referred to non-
compliance by petitioner ISA with the requirements of Section 16, Rule 3 of the
Rules of Court.
Petitioner ISA moved for reconsideration of the trial court's Order, contending that
despite the expiration of its term, its juridical existence continued until the winding
up of its affairs could be completed. In the alternative, petitioner ISA urged that
the Republic of the Philippines, being the real party-in-interest, should be allowed
to be substituted for petitioner ISA. In this connection, ISA referred to a letter from
the Office of the President dated 28 September 1988 which especially directed
the Solicitor General to continue the expropriation case.
The trial court denied the motion for reconsideration, stating, among other things
that:
The property to be expropriated is not for public use or benefit [__] but for
the use and benefit [__] of NSC, a government controlled private
corporation engaged in private business and for profit, specially now that
the government, according to newspaper reports, is offering for sale to the
public its [shares of stock] in the National Steel Corporation in line with the
pronounced policy of the present administration to disengage the
government from its private business ventures. (Brackets supplied)
Petitioner went on appeal to the Court of Appeals. In a Decision dated 8 October
1991, the Court of Appeals affirmed the order of dismissal of the trial court. The
Court of Appeals held that petitioner ISA, "a government regulatory agency
exercising sovereign functions," did not have the same rights as an ordinary
corporation and that the ISA, unlike corporations organized under the Corporation
Code, was not entitled to a period for winding up its affairs after expiration of its
legally mandated term, with the result that upon expiration of its term on 11
August 1987, ISA was "abolished and [had] no more legal authority to perform
governmental functions." The Court of Appeals went on to say that the action for
expropriation could not prosper because the basis for the proceedings, the ISA's
exercise of its delegated authority to expropriate, had become ineffective as a
result of the delegate's dissolution, and could not be continued in the name of
Republic of the Philippines, represented by the Solicitor General:
It is our considered opinion that under the law, the complaint cannot
prosper, and therefore, has to be dismissed without prejudice to the refiling
of a new complaint for expropriation if the Congress sees it fit." (Emphases
supplied)
At the same time, however, the Court of Appeals held that it was premature
for the trial court to have ruled that the expropriation suit was not for a
public purpose, considering that the parties had not yet rested their
respective cases.
In this Petition for Review, the Solicitor General argues that since ISA initiated and
prosecuted the action for expropriation in its capacity as agent of the Republic of
the Philippines, the Republic, as principal of ISA, is entitled to be substituted and
to be made a party-plaintiff after the agent ISA's term had expired.
Private respondent MCFC, upon the other hand, argues that the failure of
Congress to enact a law further extending the term of ISA after 11 August 1988
evinced a "clear legislative intent to terminate the juridical existence of ISA," and
that the authorization issued by the Office of the President to the Solicitor General
for continued prosecution of the expropriation suit could not prevail over such
negative intent. It is also contended that the exercise of the eminent domain by
ISA or the Republic is improper, since that power would be exercised "not on
behalf of the National Government but for the benefit of NSC."
The principal issue which we must address in this case is whether or not the
Republic of the Philippines is entitled to be substituted for ISA in view of the
expiration of ISA's term. As will be made clear below, this is really the only issue
which we must resolve at this time.
Rule 3, Section 1 of the Rules of Court specifies who may be parties to a civil
action:
Sec. 1. Who May Be Parties. — Only natural or juridical persons or entities
authorized by law may be parties in a civil action.
Under the above quoted provision, it will be seen that those who can be
parties to a civil action may be broadly categorized into two (2) groups:
(a) those who are recognized as persons under the law whether
natural, i.e., biological persons, on the one hand, or juridical person such as
corporations, on the other hand; and
(b) entities authorized by law to institute actions.
Examination of the statute which created petitioner ISA shows that ISA falls under
category (b) above. P.D. No. 272, as already noted, contains express
authorization to ISA to commence expropriation proceedings like those here
involved:
Sec. 4. Powers and Functions. — The Authority shall have the following
powers and functions:
xxx xxx xxx
(j) to initiate expropriation of land required for basic iron and steel
facilities for subsequent resale and/or lease to the companies involved if it
is shown that such use of the State's power is necessary to implement the
construction of capacity which is needed for the attainment of the objectives
of the Authority;
xxx xxx xxx
(Emphasis supplied)
It should also be noted that the enabling statute of ISA expressly authorized it
to enter into certain kinds of contracts "for and in behalf of the Government" in
the following terms:
xxx xxx xxx
(i) to negotiate, and when necessary, to enter into contracts for and in
behalf of the government, for the bulk purchase of materials, supplies or
services for any sectors in the industry, and to maintain inventories of such
materials in order to insure a continuous and adequate supply thereof and
thereby reduce operating costs of such sector;
xxx xxx xxx
(Emphasis supplied)
Clearly, ISA was vested with some of the powers or attributes normally associated
with juridical personality. There is, however, no provision in P.D. No. 272
recognizing ISA as possessing general or comprehensive juridical personality
separate and distinct from that of the Government. The ISA in fact appears to the
Court to be a non-incorporated agency or instrumentality of the Republic of the
Philippines, or more precisely of the Government of the Republic of the
Philippines. It is common knowledge that other agencies or instrumentalities of the
Government of the Republic are cast in corporate form, that is to say,
are incorporated agencies or instrumentalities, sometimes with and at other times
without capital stock, and accordingly vested with a juridical personality distinct
from the personality of the Republic. Among such incorporated agencies or
instrumentalities are: National Power Corporation; Philippine Ports
Authority; National Housing Authority; Philippine National Oil Company; Philippine
National Railways; Public Estates Authority; Philippine Virginia Tobacco
Administration, and so forth. It is worth noting that the term "Authority" has been
used to designate both incorporated and non-incorporated agencies or
instrumentalities of the Government.
We consider that the ISA is properly regarded as an agent or delegate of the
Republic of the Philippines. The Republic itself is a body corporate and juridical
person vested with the full panoply of powers and attributes which are
compendiously described as "legal personality." The relevant definitions are found
in the Administrative Code of 1987:
Sec. 2. General Terms Defined. — Unless the specific words of the text, or
the context as a whole, or a particular statute, require a different meaning:
(1) Government of the Republic of the Philippines refers to the corporate
governmental entity through which the functions of government are
exercised throughout the Philippines, including, save as the contrary
appears from the context, the various arms through which political authority
is made effective in the Philippines, whether pertaining to the autonomous
regions, the provincial, city, municipal or barangay subdivisions or other
forms of local government.
xxx xxx xxx
(4) Agency of the Government refers to any of the various units of the
Government, including a department, bureau, office, instrumentality, or
government-owned or controlled corporation, or a local government or a
distinct unit therein.
xxx xxx xxx
(10) Instrumentality refers to any agency of the National Government, not
integrated within the department framework, vested with special functions
or jurisdiction by law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational autonomy, usually
through a charter. This term includes regulatory agencies, chartered
institutions and government-owned or controlled corporations.
xxx xxx xxx
(Emphases supplied)
When the statutory term of a non-incorporated agency expires, the powers, duties
and functions as well as the assets and liabilities of that agency revert back to,
and are re-assumed by, the Republic of the Philippines, in the absence of special
provisions of law specifying some other disposition thereof such as, e.g.,
devolution or transmission of such powers, duties, functions, etc. to some other
identified successor agency or instrumentality of the Republic of the Philippines.
When the expiring agency is an incorporated one, the consequences of such
expiry must be looked for, in the first instance, in the charter of that agency and,
by way of supplementation, in the provisions of the Corporation Code. Since, in
the instant case, ISA is a non-incorporated agency or instrumentality of the
Republic, its powers, duties, functions, assets and liabilities are properly regarded
as folded back into the Government of the Republic of the Philippines and hence
assumed once again by the Republic, no special statutory provision having been
shown to have mandated succession thereto by some other entity or agency of
the Republic.
The procedural implications of the relationship between an agent or delegate of
the Republic of the Philippines and the Republic itself are, at least in part, spelled
out in the Rules of Court. The general rule is, of course, that an action must be
prosecuted and defended in the name of the real party in interest. (Rule 3, Section
2) Petitioner ISA was, at the commencement of the expropriation proceedings, a
real party in interest, having been explicitly authorized by its enabling statute to
institute expropriation proceedings. The Rules of Court at the same time expressly
recognize the role of representative parties:
Sec. 3. Representative Parties. — A trustee of an expressed trust, a
guardian, an executor or administrator, or a party authorized by statute may
sue or be sued without joining the party for whose benefit the action is
presented or defended; but the court may, at any stage of the proceedings,
order such beneficiary to be made a party. . . . . (Emphasis supplied)
In the instant case, ISA instituted the expropriation proceedings in its capacity as
an agent or delegate or representative of the Republic of the Philippines pursuant
to its authority under P.D. No. 272. The present expropriation suit was brought on
behalf of and for the benefit of the Republic as the principal of ISA. Paragraph 7 of
the complaint stated:
7. The Government, thru the plaintiff ISA, urgently needs the subject
parcels of land for the construction and installation of iron and steel
manufacturing facilities that are indispensable to the integration of the iron
and steel making industry which is vital to the promotion of public interest
and welfare. (Emphasis supplied)
The principal or the real party in interest is thus the Republic of the Philippines
and not the National Steel Corporation, even though the latter may be an
ultimate user of the properties involved should the condemnation suit be
eventually successful.
From the foregoing premises, it follows that the Republic of the Philippines is
entitled to be substituted in the expropriation proceedings as party-plaintiff in lieu
of ISA, the statutory term of ISA having expired. Put a little differently, the
expiration of ISA's statutory term did not by itself require or justify the dismissal of
the eminent domain proceedings.
It is also relevant to note that the non-joinder of the Republic which occurred upon
the expiration of ISA's statutory term, was not a ground for dismissal of such
proceedings since a party may be dropped or added by order of the court, on
motion of any party or on the court's own initiative at any stage of the action and
on such terms as are just. In the instant case, the Republic has precisely moved
to take over the proceedings as party-plaintiff.
In E.B. Marcha Transport Company, Inc. v. Intermediate Appellate Court, the
Court recognized that the Republic may initiate or participate in actions involving
its agents. There the Republic of the Philippines was held to be a proper party to
sue for recovery of possession of property although the "real" or registered owner
of the property was the Philippine Ports Authority, a government agency vested
with a separate juridical personality. The Court said:
It can be said that in suing for the recovery of the rentals, the Republic of
the Philippines acted as principal of the Philippine Ports Authority, directly
exercising the commission it had earlier conferred on the latter as its agent.
. . . (Emphasis supplied)
In E.B. Marcha, the Court also stressed that to require the Republic to
commence all over again another proceeding, as the trial court and Court of
Appeals had required, was to generate unwarranted delay and create needless
repetition of proceedings:
More importantly, as we see it, dismissing the complaint on the ground that
the Republic of the Philippines is not the proper party would result in
needless delay in the settlement of this matter and also in derogation of the
policy against multiplicity of suits. Such a decision would require the
Philippine Ports Authority to refile the very same complaint already proved
by the Republic of the Philippines and bring back as it were to square
one. (Emphasis supplied)
As noted earlier, the Court of Appeals declined to permit the substitution of the
Republic of the Philippines for the ISA upon the ground that the action for
expropriation could not prosper because the basis for the proceedings, the ISA's
exercise of its delegated authority to expropriate, had become legally ineffective
by reason of the expiration of the statutory term of the agent or delegated i.e.,
ISA. Since, as we have held above, the powers and functions of ISA have
reverted to the Republic of the Philippines upon the termination of the statutory
term of ISA, the question should be addressed whether fresh legislative authority
is necessary before the Republic of the Philippines may continue the expropriation
proceedings initiated by its own delegate or agent.
While the power of eminent domain is, in principle, vested primarily in the
legislative department of the government, we believe and so hold that no new
legislative act is necessary should the Republic decide, upon being substituted for
ISA, in fact to continue to prosecute the expropriation proceedings. For the
legislative authority, a long time ago, enacted a continuing or standing delegation
of authority to the President of the Philippines to exercise, or cause the exercise
of, the power of eminent domain on behalf of the Government of the Republic of
the Philippines. The 1917 Revised Administrative Code, which was in effect at the
time of the commencement of the present expropriation proceedings before the
Iligan Regional Trial Court, provided that:
Sec. 64. Particular powers and duties of the President of the Philippines. —
In addition to his general supervisory authority, the President of the
Philippines shall have such other specific powers and duties as are
expressly conferred or imposed on him by law, and also, in particular, the
powers and duties set forth in this Chapter.
Among such special powers and duties shall be:
xxx xxx xxx
(h) To determine when it is necessary or advantageous to exercise the right of
eminent domain in behalf of the Government of the Philippines; and to direct
the Secretary of Justice, where such act is deemed advisable, to cause the
condemnation proceedings to be begun in the court having proper jurisdiction.
(Emphasis supplied)
The Revised Administrative Code of 1987 currently in force has substantially
reproduced the foregoing provision in the following terms:
Sec. 12. Power of eminent domain. — The President shall determine when
it is necessary or advantageous to exercise the power of eminent domain in
behalf of the National Government, and direct the Solicitor General,
whenever he deems the action advisable, to institute expopriation
proceedings in the proper court. (Emphasis supplied)
In the present case, the President, exercising the power duly delegated
under both the 1917 and 1987 Revised Administrative Codes in effect
made a determination that it was necessary and advantageous to
exercise the power of eminent domain in behalf of the Government of the
Republic and accordingly directed the Solicitor General to proceed with
the suit.
It is argued by private respondent MCFC that, because Congress after becoming
once more the depository of primary legislative power, had not enacted a statute
extending the term of ISA, such non-enactment must be deemed a manifestation
of a legislative design to discontinue or abort the present expropriation suit. We
find this argument much too speculative; it rests too much upon simple silence on
the part of Congress and casually disregards the existence of Section 12 of the
1987 Administrative Code already quoted above.
Other contentions are made by private respondent MCFC, such as, that the
constitutional requirement of "public use" or "public purpose" is not present in the
instant case, and that the indispensable element of just compensation is also
absent. We agree with the Court of Appeals in this connection that these
contentions, which were adopted and set out by the Regional Trial Court in its
order of dismissal, are premature and are appropriately addressed in the
proceedings before the trial court. Those proceedings have yet to produce a
decision on the merits, since trial was still on going at the time the Regional Trial
Court precipitously dismissed the expropriation proceedings. Moreover, as a
pragmatic matter, the Republic is, by such substitution as party-plaintiff, accorded
an opportunity to determine whether or not, or to what extent, the proceedings
should be continued in view of all the subsequent developments in the iron and
steel sector of the country including, though not limited to, the partial privatization
of the NSC.
WHEREFORE, for all the foregoing, the Decision of the Court of Appeals dated 8
October 1991 to the extent that it affirmed the trial court's order dismissing the
expropriation proceedings, is hereby REVERSED and SET ASIDE and the case is
REMANDED to the court a quo which shall allow the substitution of the Republic
of the Philippines for petitioner Iron and Steel Authority and for further
proceedings consistent with this Decision. No pronouncement as to costs.
SO ORDERED.
Romero, Melo, Vitug and Panganiban, JJ., concur.
Footnotes
1 Second paragraph, Section 1, P.D. No. 272.
2 The relevant terms of LOI No. 1277 read as follows:
"(2) In the event that NSC and MCFC fail to agree on the foregoing
within sixty (60) days from the date hereof, the Iron and Steel
Authority (ISA) shall exercise its authority under Presidential Decree
(PD) No. 272, as amended, to initiate the expropriation of the
aforementioned occupancy rights of MCFC on the subject lands as
well as the plant, structures, equipment, machinery and related
facilities, for and on behalf of NSC, and thereafter cede the same to
NSC. During the pendency of the expopriation proceedings, NSC
shall take possession of the property, subject to bonding and other
requirements of P.D. No. 1533.
xxx xxx xxx
3 Section 1, Rule 3.
4 Section 16, Rule 3 of the Rules of Court reads:
"Sec. 16. Duty of attorney upon death, incapacity or incompetency of
party. — Whenever a party to a pending case dies becomes
incapacitated or incompetent, it shall be the duty of his attorney to
inform the court promptly of such death, incapacity or incompetency,
and to give the name and residence of his executor, administrator,
guardian or other legal representative."
5 RTC Order dated 22 March 1989, p. 2; CA Rollo, p. 24.
6 Section 2, Republic Act No. 6395, 10 September 1971.
7 Section 4, Presidential Decree No. 857, 23 December 1975.
8 Section 2, Presidential Decree No. 757, 31 July 1975.
9 Section 3, Presidential Decree No. 334, 9 November 1973.
10 Section 1, Republic Act No. 4156, 20 June 1964.
11 Sections 3 and 5, Presidential Decree No. 1084, 4 February 1977.
12 Sections 3 and 4(k), Republic Act No. 2265, 19 June 1959.
13 Rule 3, Section 11, Rules of Court. See, in this connection, St. Anne
Medical Center v. Parel (176 SCRA 755 [1989]), where the petition had
been filed in the name of "St. Anne Medical Center" which was not a
juridical person and where this Court invoked Rule 3, Section 11 and
impleaded the real party-in-interest.
14 147 SCRA 276 (1987).
15 147 SCRA at 279.
16 146 SCRA at 279. In Lagazon v. Reyes (166 SCRA 386 [1988]), the
Court said that
"the aim of [Rule 3, Section 11] is that all persons materially
interested, legally or beneficially, in the subject matter of the suit
should be made parties to it in order that the whole matter in dispute
may be determined once and for all in one litigation, thus avoiding
multiplicity of suits . . . ." (166 SCRA at 392)
17 Letter of 28 September 1988; Records, p. 1297.
 G.R. No. 149179. July 15, 2005
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, INC., Petitioners,
vs.
CITY OF BACOLOD, FLORENTINO T. GUANCO, in his capacity as the City
Treasurer of Bacolod City, and ANTONIO G. LACZI, in his capacity as the
City Legal Officer of Bacolod City, Respondents.
DECISION
GARCIA, J.:
In this appeal by way of a petition for review on certiorari under Rule 45 of the
Rules of Court, petitioner Philippine Long Distance Telephone Company (PLDT),
seeks the reversal and setting aside of the July 23, 2001 decision of the
Regional Trial Court at Bacolod City, Branch 42, dismissing its petition in Civil
Case No. 99-10786, an action to declare petitioner as exempt from the payment
of franchise and business taxes sought to be imposed and collected by the
respondent City of Bacolod.
The material facts are not at all disputed:
PLDT is a holder of a legislative franchise under Act No. 3436, as amended, to
render local and international telecommunications services. On August 24, 1991,
the terms and conditions of its franchise were consolidated under Republic Act
No. 7082, Section 12 of which embodies the so-called "in-lieu-of-all-taxes" clause,
whereunder PLDT shall pay a franchise tax equivalent to three percent (3%) of all
its gross receipts, which franchise tax shall be "in lieu of all taxes". More
specifically, the provision pertinently reads:
SEC. 12. xxx In addition thereto, the grantee, its successors or assigns shall pay a
franchise tax equivalent to three percent (3%) of all gross receipts of the
telephone or other telecommunications businesses transacted under this
franchise by the grantee, its successors or assigns, and the said percentage shall
be in lieu of all taxes on this franchise or earnings thereof. xxx (Italics ours).
Meanwhile, or on January 1, 1992, Republic Act No. 7160, otherwise known as
the Local Government Code, took effect. Section 137 of the Code, in relation to
Section 151 thereof, grants cities and other local government units the power to
impose local franchise tax on businesses enjoying a franchise, thus:
SEC. 137. Franchise Tax. – Notwithstanding any exemption granted by any law or
other special law, the province may impose a tax on businesses enjoying a
franchise, at a rate not exceeding fifty percent (50%) of one percent (1%) of the
gross annual receipts for the preceding calendar year based on the incoming
receipt, or realized, within its territorial jurisdiction.
xxx xxx xxx
SEC. 151. Scope of Taxing Powers. – Except as otherwise provided in this Code,
the city, may levy the taxes, fees, and charges which the province or municipality
may impose: Provided, however, That the taxes, fees, and charges levied and
collected by highly urbanized and independent component cities shall accrue to
them and distributed in accordance with the provisions of this Code.
The rates of taxes that the city may levy may exceed the maximum rates allowed
for the province or municipality by not more than fifty percent (50%) except the
rates of professional and amusement taxes.
By Section 193 of the same Code, all tax exemption privileges then enjoyed by all
persons, whether natural or juridical, save those expressly mentioned therein,
were withdrawn, necessarily including those taxes from which PLDT is exempted
under the "in-lieu-of-all-taxes" clause in its charter. We quote Section 193:
SEC. 193. Withdrawal of Tax Exemption Privileges. – Unless otherwise provided
in this Code, tax exemptions or incentives granted to, or presently enjoyed by all
persons, whether natural or juridical, including government-owned or controlled
corporations, except local water districts, cooperatives duly registered under R.A.
6938, non-stock and non-profit hospitals and educational institutions, are hereby
withdrawn upon the effectivity of this Code.
Aiming to level the playing field among telecommunication companies, Congress
enacted Republic Act No. 7925, otherwise known as the Public
Telecommunications Policy Act of the Philippines, which took effect on March 16,
1995. To achieve the legislative intent, Section 23 thereof, also known as the
"most-favored- treatment" clause, provides for an equality of treatment in the
telecommunications industry, thus:
SEC. 23. Equality of Treatment in the Telecommunications Industry – Any
advantage, favor, privilege, exemption, or immunity granted under existing
franchises, or may hereafter be granted shall ipso facto become part of previously
granted telecommunications franchises and shall be accorded immediately and
unconditionally to the grantees of such franchises: Provided, however, That the
foregoing shall neither apply to nor affect provisions of telecommunications
franchises concerning territory covered by the franchise, the life span of the
franchise, or the type of the service authorized by the franchise.
In August 1995, the City of Bacolod, invoking its authority under Section 137, in
relation to Section 151 and Section 193, supra, of the Local Government Code,
made an assessment on PLDT for the payment of franchise tax due the City.
Complying therewith, PLDT began paying the City franchise tax from the year
1994 until the third quarter of 1998, at which time the total franchise tax it had paid
the City already amounted to ₱2,770,696.37.
On June 2, 1998, the Department of Finance through its Bureau of Local
Government Finance (BLGF), issued a ruling to the effect that as of March 16,
1995, the effectivity date of the Public Telecommunications Policy Act of the
Philippines (Rep. Act. No. 7925), PLDT, among other telecommunication
companies, became exempt from local franchise tax. Pertinently, the BLGF ruling
reads:
It appears that RA 7082 further amending ACT No. 3436 which granted to PLDT a
franchise to install, operate and maintain a telephone system throughout the
Philippine Islands was approved on August 3, 1991. Section 12 of said franchise,
likewise, contains the ‘in lieu of all taxes’ proviso.
In this connection, Section 23 of RA 7925, quoted hereunder, which was
approved on March 1, 1995 provides for the equality of treatment in the
telecommunications industry:
xxx xxx xxx
On the basis of the aforequoted Section 23 of RA 7925, PLDT as a
telecommunications franchise holder becomes automatically covered by the tax
exemption provisions of RA 7925, which took effect on March 16, 1995.
Accordingly, PLDT shall be exempt from the payment of franchise and business
taxes imposable by LGUs under Sections 137 and 143, respectively, of the LGC
[Local Government Code], upon the effectivity of RA 7925 on March 16, 1995.
However, PLDT shall be liable to pay the franchise and business taxes on its
gross receipts realized from January 1, 1992 up to March 15, 1995, during which
period PLDT was not enjoying the ‘most favored clause’ proviso of RA 7025 [sic].
Invoking the aforequoted ruling, PLDT then stopped paying local franchise and
business taxes to Bacolod City starting the fourth quarter of 1998.
The controversy came to a head-on when, sometime in 1999, PLDT applied for
the issuance of a Mayor’s Permit but the City of Bacolod withheld issuance thereof
pending PLDT’s payment of its franchise tax liability in the following amounts: (1)
₱358,258.30 for the fourth quarter of 1998; and (b) ₱1,424,578.10 for the year
1999, all in the aggregate amount of ₱1,782,836.40, excluding surcharges and
interest, about which PLDT was duly informed by the City Treasurer via a 5th
Indorsement dated March 16, 1999 for PLDT’s "appropriate action".
In time, PLDT filed a protest with the Office of the City Legal Officer, questioning
the assessment and at the same time asking for a refund of the local franchise
taxes it paid in 1997 until the third quarter of 1998.
In a reply-letter dated March 26, 1999, City Legal Officer Antonio G. Laczi denied
the protest and ordered PLDT to pay the questioned assessment.
Hence, on May 14, 1999, in the Regional Trial Court at Bacolod City, PLDT filed
its petition in Civil Case No. 99-10786, therein praying for a judgment declaring it
as exempt from the payment of local franchise and business taxes; ordering the
respondent City to henceforth cease and desist from assessing and collecting said
taxes; directing the City to issue the Mayor’s Permit for the year 1999; and
requiring it to refund the amount of ₱2,770,606.37, allegedly representing
overpaid franchise taxes for the years 1997 and 1998 with interest until fully paid.
In time, the respondent City filed its Answer/Comment to the petition, basically
maintaining that Section 137 of the Local Government Code remains as the
operative law despite the enactment of the Public Telecommunications Policy Act
of the Philippines (Rep. Act No. 7925), and accordingly prayed for the dismissal of
the petition.
In the ensuing pre-trial conference, the parties manifested that they would not
present any testimonial evidence, and merely requested for time to file their
respective memoranda, to which the trial court acceded.
Eventually, in the herein assailed decision dated July 23, 2001, the trial court
dismissed PLDT’s petition, thus:
WHEREFORE, premises considered, the petition should be, as it is hereby
DISMISSED. No costs.
SO ORDERED.
Therefrom, PLDT came to this Court via the present recourse, imputing the
following errors on the part of the trial court:
5.01.a. THE LOWER COURT ERRED IN SUSTAINING RESPONDENTS’
POSITION THAT SECTION 137 OF THE LOCAL GOVERNMENT CODE,
WHICH, IN RELATION TO SECTION 151 THEREOF, ALLOWS RESPONDENT
CITY TO IMPOSE THE FRANCHISE TAX, IS APPLICABLE IN THIS CASE.
5.01.b. THE LOWER COURT ERRED IN NOT HOLDING THAT UNDER
PETITIONER’S FRANCHISE (REPUBLIC ACT NO. 7082), AS AMENDED AND
EXPANDED BY SECTION 23 OF REPUBLIC ACT NO. 7925 (PUBLIC
TELECOMMUNICATIONS POLICY ACT), TAKING INTO ACCOUNT THE
FRANCHISES OF GLOBE TELECOM, INC., (GLOBE) (REPUBLIC ACT NO.
7229) AND SMART COMMUNICATIONS, INC. (SMART) (REPUBLIC ACT NO.
7294), WHICH WERE ENACTED SUBSEQUENT TO THE LOCAL
GOVERNMENT CODE, NO FRANCHISE TAXES MAY BE IMPOSED ON
PETITIONER BY RESPONDENT CITY.
5.01.c. THE LOWER COURT ERRED IN NOT GIVING WEIGHT TO THE
RULING OF THE DEPARTMENT OF FINANCE, THROUGH ITS BUREAU OF
LOCAL GOVERNMENT FINANCE, THAT PETITIONER IS EXEMPT FROM THE
PAYMENT OF FRANCHISE AND BUSINESS TAXES IMPOSABLE BY LOCAL
GOVERNMENT UNITS UNDER THE LOCAL GOVERNMENT CODE.
5.01.d. THE LOWER COURT ERRED IN DISMISSING THE PETITION BELOW.
As we see it, the only question which commends itself for our resolution is,
whether or not Section 23 of Rep. Act No. 7925, also called the "most-favored-
treatment" clause, operates to exempt petitioner PLDT from the payment of
franchise tax imposed by the respondent City of Bacolod.
Contrary to petitioner’s claim, the issue thus posed is not one of "first impression"
insofar as this Court is concerned. For sure, this is not the first time for petitioner
PLDT to invoke the jurisdiction of this Court on the same question, albeit involving
another city.
In PLDT vs. City of Davao, this Court has had the occasion to interpret Section 23
of Rep. Act No. 7925. There, we ruled that Section 23 does not operate to exempt
PLDT from the payment of franchise tax imposed upon it by the City of Davao:
In sum, it does not appear that, in approving §23 of R.A. No. 7925, Congress
intended it to operate as a blanket tax exemption to all telecommunications
entities. Applying the rule of strict construction of laws granting tax exemptions
and the rule that doubts should be resolved in favor of municipal corporations in
interpreting statutory provisions on municipal taxing powers, we hold that §23 of
R.A. No. 7925 cannot be considered as having amended petitioner's franchise so
as to entitle it to exemption from the imposition of local franchise taxes.
Consequently, we hold that petitioner is liable to pay local franchise taxes in the
amount of ₱3,681,985.72 for the period covering the first to the fourth quarter of
1999 and that it is not entitled to a refund of taxes paid by it for the period
covering the first to the third quarter of 1998.
Explains this Court in the same case:
To begin with, tax exemptions are highly disfavored. The reason for this was
explained by this Court in Asiatic Petroleum Co. v. Llanes, in which it was held:
. . . Exemptions from taxation are highly disfavored, so much so that they may
almost be said to be odious to the law. He who claims an exemption must be able
to point to some positive provision of law creating the right. . . As was said by the
Supreme Court of Tennessee in Memphis vs. U. & P. Bank (91 Tenn., 546, 550),
‘The right of taxation is inherent in the State. It is a prerogative essential to the
perpetuity of the government; and he who claims an exemption from the common
burden must justify his claim by the clearest grant of organic or statute law.’ Other
utterances equally or more emphatic come readily to hand from the highest
authority. In Ohio Life Ins. and Trust Co. vs. Debolt (16 Howard, 416), it was said
by Chief Justice Taney, that the right of taxation will not be held to have been
surrendered, ‘unless the intention to surrender is manifested by words too plain to
be mistaken.’ In the case of the Delaware Railroad Tax (18 Wallace, 206, 226),
the Supreme Court of the United States said that the surrender, when claimed,
must be shown by clear, unambiguous language, which will admit of no
reasonable construction consistent with the reservation of the power. If a doubt
arises as to the intent of the legislature, that doubt must be solved in favor of the
State. In Erie Railway Company vs. Commonwealth of Pennsylvania (21 Wallace,
492, 499), Mr. Justice Hunt, speaking of exemptions, observed that a State cannot
strip itself of the most essential power of taxation by doubtful words. ‘It cannot, by
ambiguous language, be deprived of this highest attribute of sovereignty.’
In Tennessee vs. Whitworth (117 U.S., 129, 136), it was said: ‘In all cases of this
kind the question is as to the intent of the legislature, the presumption always
being against any surrender of the taxing power.’ In Farrington vs. Tennessee and
County of Shelby (95 U.S., 379, 686), Mr. Justice Swayne said: ‘. . . When
exemption is claimed, it must be shown indubitably to exist. At the outset, every
presumption is against it. A well-founded doubt is fatal to the claim. It is only when
the terms of the concession are too explicit to admit fairly of any other construction
that the proposition can be supported.’
The tax exemption must be expressed in the statute in clear language that leaves
no doubt of the intention of the legislature to grant such exemption. And, even if it
is granted, the exemption must be interpreted in strictissimi jurisagainst the
taxpayer and liberally in favor of the taxing authority.
xxx xxx xxx
The fact is that the term ‘exemption’ in §23 is too general. A cardinal rule in
statutory construction is that legislative intent must be ascertained from a
consideration of the statute as a whole and not merely of a particular provision.
For, taken in the abstract, a word or phrase might easily convey a meaning which
is different from the one actually intended. A general provision may actually have
a limited application if read together with other provisions. Hence, a consideration
of the law itself in its entirety and the proceedings of both Houses of Congress is
in order.
xxx xxx xxx
R.A. No. 7925 is thus a legislative enactment designed to set the national policy
on telecommunications and provide the structures to implement it to keep up with
the technological advances in the industry and the needs of the public. The thrust
of the law is to promote gradually the deregulation of the entry, pricing, and
operations of all public telecommunications entities and thus promote a level
playing field in the telecommunications industry. There is nothing in the language
of §23 nor in the proceedings of both the House of Representatives and the
Senate in enacting R.A. No. 7925 which shows that it contemplates the grant of
tax exemptions to all telecommunications entities, including those whose
exemptions had been withdrawn by the LGC.
What this Court said in Asiatic Petroleum Co. v. Llanes applies mutatis
mutandis to this case: ‘When exemption is claimed, it must be shown indubitably
to exist. At the outset, every presumption is against it. A well-founded doubt is
fatal to the claim. It is only when the terms of the concession are too explicit to
admit fairly of any other construction that the proposition can be supported.’ In this
case, the word ‘exemption’ in §23 of R.A. No. 7925 could contemplate exemption
from certain regulatory or reporting requirements, bearing in mind the policy of the
law. It is noteworthy that, in holding Smart and Globe exempt from local taxes, the
BLGF did not base its opinion on §23 but on the fact that the franchises granted to
them after the effectivity of the LGC exempted them from the payment of local
franchise and business taxes.
As in City of Davao, supra, petitioner presently argues that because Smart
Communications, Inc. (SMART) and Globe Telecom (GLOBE) under whose
respective franchises granted after the effectivity of the Local Government Code,
are exempt from franchise tax, it follows that petitioner is likewise exempt from the
franchise tax sought to be collected by the City of Bacolod, on the reasoning that
the grant of tax exemption to SMART and GLOBE ipso factoapplies to PLDT,
consistent with the "most-favored-treatment" clause found in Section 23 of
the Public Telecommunications Policy Act of the Philippines (Rep. Act No. 7925).
Again, there is nothing novel in petitioner’s contention. In fact, this Court in City of
Davao, even adverted to PLDT’s argument therein, thus:
Finally, it [PLDT] argues that because Smart and Globe are exempt from the
franchise tax, it follows that it must likewise be exempt from the tax being
collected by the City of Davao because the grant of tax exemption to Smart and
Globe ipso facto extended the same exemption to it.
In rejecting PLDT’s contention, this Court ruled in City of Davao as follows:
The acceptance of petitioner’s theory would result in absurd consequences. To
illustrate: In its franchise, Globe is required to pay a franchise tax of only one and
one-half percentum (1/2% [sic] ) of all gross receipts from its transactions while
Smart is required to pay a tax of three percent (3%) on all gross receipts from
business transacted. Petitioner’s theory would require that, to level the playing
field, any "advantage, favor, privilege, exemption, or immunity" granted to Globe
must be extended to all telecommunications companies, including Smart. If, later,
Congress again grants a franchise to another telecommunications company
imposing, say, one percent (1%) franchise tax, then all other telecommunications
franchises will have to be adjusted to "level the playing field" so to speak. This
could not have been the intent of Congress in enacting Section 23 of Rep. Act
7925. Petitioner’s theory will leave the Government with the burden of having to
keep track of all granted telecommunications franchises, lest some companies be
treated unequally. It is different if Congress enacts a law specifically granting
uniform advantages, favor, privilege, exemption or immunity to all
telecommunications entities.
On PLDT’s motion for reconsideration in Davao, the Court added in its en
banc Resolution of March 25, 2003, that even as it is a state policy to promote a
level playing field in the communications industry, Section 23 of Rep. Act No.
7925 does not refer to tax exemption but only to exemption from certain
regulations and requirements imposed by the National Telecommunications
Commission:
xxx. The records of Congress are bereft of any discussion or even mention of tax
exemption. To the contrary, what the Chairman of the Committee on
Transportation, Rep. Jerome V. Paras, mentioned in his sponsorship of H.B. No.
14028, which became R.A. No. 7925, were ‘equal access clauses’ in
interconnection agreements, not tax exemptions. He said:
There is also a need to promote a level playing field in the telecommunications
industry. New entities must be granted protection against dominant carriers
through the encouragement of equitable access charges and equal access
clauses in interconnection agreements and the strict policing of predatory pricing
by dominant carriers. Equal access should be granted to all operators connecting
into the interexchange network. There should be no discrimination against any
carrier in terms of priorities and/or quality of services.
Nor does the term ‘exemption’ in § 23 of R.A. No. 7925 mean tax exemption. The
term refers to exemption from certain regulations and requirements imposed by
the National Telecommunications Commission (NTC). For instance, R.A. No.
7925, § 17 provides: ‘The Commission shall exempt any specific
telecommunications service from its rate or tariff regulations if the service has
sufficient competition to ensure fair and reasonable rates or tariffs.’ Another
exemption granted by the law in line with its policy of deregulation is the
exemption from the requirement of securing permits from the NTC every time a
telecommunications company imports equipment.
In the same en banc Resolution, the Court even rejected PLDT’s contention that
the "in-lieu-of-all-taxes" clause does not refer to "tax exemption" but to "tax
exclusion" and hence, the strictissimi juris rule does not apply, explaining that
these two terms actually mean the same thing, such that the rule that tax
exemption should be applied in strictissimi juris against the taxpayer and liberally
in favor of the government applies equally to tax exclusions. Thus:
Indeed, both in their nature and in their effect there is no difference between tax
exemption and tax exclusion. Exemption is an immunity or privilege; it is freedom
from a charge or burden to which others are subjected. Exclusion, on the other
hand, is the removal of otherwise taxable items from the reach of taxation, e.g.,
exclusions from gross income and allowable deductions. Exclusion is thus also an
immunity or privilege which frees a taxpayer from a charge to which others are
subjected. Consequently, the rule that tax exemption should be applied
in strictissimi juris against the taxpayer and liberally in favor of the government
applies equally to tax exclusions. To construe otherwise the ‘in lieu of all taxes’
provision invoked is to be inconsistent with the theory that R.A. No. 7925, § 23
grants tax exemption because of a similar grant to Globe and Smart.
PLDT likewise argued in said case that the RTC at Davao City erred in not giving
weight to the ruling of the BLGF which, according to petitioner, is an administrative
agency with technical expertise and mastery over the specialized matters
assigned to it. But then again, we held in Davao:
To be sure, the BLGF is not an administrative agency whose findings on
questions of fact are given weight and deference in the courts. The authorities
cited by petitioner pertain to the Court of Tax Appeals, a highly specialized court
which performs judicial functions as it was created for the review of tax cases. In
contrast, the BLGF was created merely to provide consultative services and Rollo, pp. 110-116.
technical assistance to local governments and the general public on local taxation,
real property assessment, and other related matters, among others. The question G.R. No. 143867; 415 Phil. 769 [2001].
raised by petitioner is a legal question, to wit, the interpretation of §23 of R.A. No.
7925. There is, therefore, no basis for claiming expertise for the BLGF that Id., p. 780.
administrative agencies are said to possess in their respective fields.
447 Phil. 571 [2003].
We note, quite interestingly, that apart from the particular local government unit
involved in the earlier case of PLDT vs. Davao, the arguments presently advanced
by petitioner on the issue herein posed are but a mere reiteration if not repetition Id., pp. 580-581.
of the very same arguments it has already raised in Davao. For sure, the errors
presently assigned are substantialy the same as those in Davao, all of which have Id., p. 584.
been adequately addressed and passed upon by this Court in its decision therein
as well as in its en banc resolution in that case. Supra, pp. 779-780.

WHEREFORE, the instant petition is DENIED and the assailed decision dated
July 23, 2001 of the lower court AFFIRMED.
G.R. No. 84811 August 29, 1989
Costs against petitioner.
SOLID HOMES, INC., petitioner,
SO ORDERED. vs.
TERESITA PAYAWAL and COURT OF APPEALS, respondents.
Sandoval-Gutierrez, Corona, and Carpio-Morales, JJ., concur.
CRUZ, J.:
Panganiban, (Chairman), no part, former counsel of the party.
We are asked to reverse a decision of the Court of Appeals sustaining the
Footnotes jurisdiction of the Regional Trial Court of Quezon City over a complaint filed by a
buyer, the herein private respondent, against the petitioner, for delivery of title to a
Rollo, pp. 110-116. subdivision lot. The position of the petitioner, the defendant in that action, is that
the decision of the trial court is null and void ab initio because the case should
An Act Further Amending Act No. 3436, as amended, "xxx Consolidating have been heard and decided by what is now called the Housing and Land Use
the Terms and Conditions of the Franchise Granted to the [PLDT], And Regulatory Board.
Extending the Said Franchise by Twenty-Five (25) Years from the
Expiration Thereof xxx". The complaint was filed on August 31, 1982, by Teresita Payawal against Solid
Homes, Inc. before the Regional Trial Court of Quezon City and docketed as Civil
Rollo, p. 80. Case No. Q-36119. The plaintiff alleged that the defendant contracted to sell to
her a subdivision lot in Marikina on June 9, 1975, for the agreed price of P
28,080.00, and that by September 10, 1981, she had already paid the defendant
Rollo, p. 85. the total amount of P 38,949.87 in monthly installments and interests. Solid
Homes subsequently executed a deed of sale over the land but failed to deliver
Rollo, pp. 86-88. the corresponding certificate of title despite her repeated demands because, as it
appeared later, the defendant had mortgaged the property in bad faith to a
Rollo, pp. 89-90. financing company. The plaintiff asked for delivery of the title to the lot or,
alternatively, the return of all the amounts paid by her plus interest. She also
Rollo, pp. 67-71. claimed moral and exemplary damages, attorney's fees and the costs of the suit.

Rollo, pp. 94-108. Solid Homes moved to dismiss the complaint on the ground that the court had no
jurisdiction, this being vested in the National Housing Authority under PD No. 957.
The motion was denied. The defendant repleaded the objection in its answer,
citing Section 3 of the said decree providing that "the National Housing Authority
shall have exclusive jurisdiction to regulate the real estate trade and business in
accordance with the provisions of this Decree." After trial, judgment was rendered
in favor of the plaintiff and the defendant was ordered to deliver to her the title to
the land or, failing this, to refund to her the sum of P 38,949.87 plus interest from
1975 and until the full amount was paid. She was also awarded P 5,000.00 moral
damages, P 5,000.00 exemplary damages, P 10,000.00 attorney's fees, and the
costs of the suit.
Solid Homes appealed but the decision was affirmed by the respondent
court, which also berated the appellant for its obvious efforts to evade a legitimate
obligation, including its dilatory tactics during the trial. The petitioner was also
reproved for its "gall" in collecting the further amount of P 1,238.47 from the
plaintiff purportedly for realty taxes and registration expenses despite its inability
to deliver the title to the land.
In holding that the trial court had jurisdiction, the respondent court referred to
Section 41 of PD No. 957 itself providing that:
SEC. 41. Other remedies.-The rights and remedies provided in this Decree
shall be in addition to any and all other rights and remedies that may be
available under existing laws.
and declared that "its clear and unambiguous tenor undermine(d) the (petitioner's)
pretension that the court a quowas bereft of jurisdiction." The decision also
dismissed the contrary opinion of the Secretary of Justice as impinging on the
authority of the courts of justice. While we are disturbed by the findings of fact of
the trial court and the respondent court on the dubious conduct of the petitioner,
we nevertheless must sustain it on the jurisdictional issue.
The applicable law is PD No. 957, as amended by PD No. 1344, entitled
"Empowering the National Housing Authority to Issue Writs of Execution in the
Enforcement of Its Decisions Under Presidential Decree No. 957." Section 1 of the
latter decree provides as follows:
SECTION 1. In the exercise of its function to regulate the real estate trade
and business and in addition to its powers provided for in Presidential
Decree No. 957, the National Housing Authority shall haveexclusive
jurisdiction to hear and decide cases of the following nature:
A. Unsound real estate business practices;
B. Claims involving refund and any other claims filed by subdivision lot or
condominium unit buyer against the project owner, developer, dealer,
broker or salesman; and
C. Cases involving specific performance of contractuala statutory
obligations filed by buyers of subdivision lot or condominium unit against
the owner, developer, dealer, broker or salesman. (Emphasis supplied.)
The language of this section, especially the italicized portions, leaves no room for
doubt that "exclusive jurisdiction" over the case between the petitioner and the
private respondent is vested not in the Regional Trial Court but in the National
Housing Authority.
The private respondent contends that the applicable law is BP No. 129, which
confers on regional trial courts jurisdiction to hear and decide cases mentioned in
its Section 19, reading in part as follows:
SEC. 19. Jurisdiction in civil cases.-Regional Trial Courts shall exercise
exclusive original jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of
pecuniary estimation;
(2) In all civil actions which involve the title to, or possession of, real
property, or any interest therein, except actions for forcible entry into and
unlawful detainer of lands or buildings, original jurisdiction over which is
conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts;
xxx xxx xxx
(8) In all other cases in which the demand, exclusive of interest and cost or
the value of the property in controversy, amounts to more than twenty
thousand pesos (P 20,000.00).
It stresses, additionally, that BP No. 129 should control as the later enactment,
having been promulgated in 1981, after PD No. 957 was issued in 1975 and PD
No. 1344 in 1978.
This construction must yield to the familiar canon that in case of conflict between a
general law and a special law, the latter must prevail regardless of the dates of
their enactment. Thus, it has been held that-
The fact that one law is special and the other general creates a
presumption that the special act is to be considered as remaining an
exception of the general act, one as a general law of the land and the other
as the law of the particular case.
xxx xxx xxx
The circumstance that the special law is passed before or after the general
act does not change the principle. Where the special law is later, it will be
 regarded as an exception to, or a qualification of, the prior general act; and
where the general act is later, the special statute will be construed as
remaining an exception to its terms, unless repealed expressly or by
necessary implication.
It is obvious that the general law in this case is BP No. 129 and PD No. 1344 the
special law.
The argument that the trial court could also assume jurisdiction because of
Section 41 of PD No. 957, earlier quoted, is also unacceptable. We do not read
that provision as vesting concurrent jurisdiction on the Regional Trial Court and
the Board over the complaint mentioned in PD No. 1344 if only because grants of
power are not to be lightly inferred or merely implied. The only purpose of this
section, as we see it, is to reserve. to the aggrieved party such other remedies as
may be provided by existing law, like a prosecution for the act complained of
under the Revised Penal Code.
On the competence of the Board to award damages, we find that this is part of the
exclusive power conferred upon it by PD No. 1344 to hear and decide "claims
involving refund and any other claims filed by subdivision lot or condominium unit
buyers against the project owner, developer, dealer, broker or salesman." It was
therefore erroneous for the respondent to brush aside the well-taken opinion of
the Secretary of Justice that-
Such claim for damages which the subdivision/condominium buyer may
have against the owner, developer, dealer or salesman, being a necessary
consequence of an adjudication of liability for non-performance of
contractual or statutory obligation, may be deemed necessarily included in
the phrase "claims involving refund and any other claims" used in the
aforequoted subparagraph C of Section 1 of PD No. 1344. The phrase "any
other claims" is, we believe, sufficiently broad to include any and all claims
which are incidental to or a necessary consequence of the claims/cases
specifically included in the grant of jurisdiction to the National Housing
Authority under the subject provisions.
The same may be said with respect to claims for attorney's fees which are
recoverable either by agreement of the parties or pursuant to Art. 2208 of
the Civil Code (1) when exemplary damages are awarded and (2) where
the defendant acted in gross and evident bad faith in refusing to satisfy the
plaintiff 's plainly valid, just and demandable claim.
xxx xxx xxx
Besides, a strict construction of the subject provisions of PD No. 1344
which would deny the HSRC the authority to adjudicate claims for damages
and for damages and for attorney's fees would result in multiplicity of suits
in that the subdivision condominium buyer who wins a case in the HSRC
and who is thereby deemed entitled to claim damages and attorney's fees
would be forced to litigate in the regular courts for the purpose, a situation
which is obviously not in the contemplation of the law. (Emphasis supplied.)
As a result of the growing complexity of the modern society, it has become
necessary to create more and more administrative bodies to help in the regulation
of its ramified activities. Specialized in the particular fields assigned to them, they
can deal with the problems thereof with more expertise and dispatch than can be
expected from the legislature or the courts of justice. This is the reason for the
increasing vesture of quasi-legislative and quasi-judicial powers in what is now not
unreasonably called the fourth department of the government.
Statutes conferring powers on their administrative agencies must be liberally
construed to enable them to discharge their assigned duties in accordance with
the legislative purpose. Following this policy in Antipolo Realty Corporation v.
National Housing Authority, the Court sustained the competence of the
respondent administrative body, in the exercise of the exclusive jurisdiction vested
in it by PD No. 957 and PD No. 1344, to determine the rights of the parties under
a contract to sell a subdivision lot.
It remains to state that, contrary to the contention of the petitioner, the case of
Tropical Homes v. National Housing is not in point. We upheld in that case the
constitutionality of the procedure for appeal provided for in PD No. 1344, but we
did not rule there that the National Housing Authority and not the Regional Trial
Court had exclusive jurisdiction over the cases enumerated in Section I of the said
decree. That is what we are doing now.
It is settled that any decision rendered without jurisdiction is a total nullity and may
be struck down at any time, even on appeal before this Court. The only exception
is where the party raising the issue is barred by estoppel, which does not appear
in the case before us. On the contrary, the issue was raised as early as in the
motion to dismiss filed in the trial court by the petitioner, which continued to plead
it in its answer and, later, on appeal to the respondent court. We have no choice,
therefore, notwithstanding the delay this decision will entail, to nullify the
proceedings in the trial court for lack of jurisdiction.
WHEREFORE, the challenged decision of the respondent court is REVERSED
and the decision of the Regional Trial Court of Quezon City in Civil Case No. Q-
36119 is SET ASIDE, without prejudice to the filing of the appropriate complaint
before the Housing and Land Use Regulatory Board. No costs.
SO ORDERED.
Narvasa, Gancayco, Griñ;o-Aquino and Medialdea, JJ., concur.
Footnotes
1 Rollo, pp. 6 & 14.
 2 Tensuan, J., ponente, with Nocon and Kalalo, JJ., concurring.
3 Under E.O. No. 648 dated Feb. 7, 1981, the regulatory functions
conferred on the National Housing Authority under P.D. Nos. 957, 1216,
1344 and other related laws were transferred to the Human Settlements
Regulatory Commission, which was renamed Housing and Land Use
Regulatory Board by E.O. No. 90 dated Dec. 17, 1986.
4 Manila Railroad Co. v. Rafferty, 40 Phil. 224 (1919); Butuan Sawmill, Inc.
v. City of Butuan, 16 SCRA 758-1 Bagatsing v. Ramirez, 74 SCRA 306.
5 59 C.J., 1056-1058.
6 Article 316.
7 Min. of Justice Op. No. 271, s. 1982.
8 Cooper River Convalescent Ctr., Inc. v. Dougherty, 356 A. 2d 55, 1975.
9 153 SCRA 399.
10 152 SCRA 54.
11 Trinidad v. Yatco, 1 SCRA 866; Corominas, Jr. v. Labor Standards
Commission, 2 SCRA 721; Sebastian v. Gerardo, 2 SCRA 763; Buena v.
Sapnay, 6 SCRA 706.
12 Tijam v. Sibonghanoy, 23 SCRA 29; Philippine National Bank v. IAC,
143 SCRA 299; Tan Boon Bee & Company, Inc. v. Judge Jarencio, G.R.
No. 41337, June 30, 1988.
G.R. No. 164789 August 27, 2009
CHRISTIAN GENERAL ASSEMBLY, INC., Petitioner,
vs.
SPS. AVELINO C. IGNACIO and PRISCILLA T. IGNACIO, Respondents.
DECISION
BRION, J.:
We resolve in this Rule 45 petition the legal issue of whether an action to rescind
a contract to sell a subdivision lot that the buyer found to be under litigation falls
under the exclusive jurisdiction of the Housing and Land Use Regulatory Board
(HLURB).
In this petition, Christian General Assembly, Inc. (CGA) prays that we set aside
the decision issued by the Court of Appeals (CA) in CA–G.R. SP No. 75717 that
dismissed its complaint for rescission filed with the Regional Trial Court (RTC) of
Bulacan for lack of jurisdiction, as well as the CA resolution that denied its motion
for reconsideration.
FACTUAL ANTECEDENTS
The present controversy traces its roots to the case filed by CGA against the
Spouses Avelino and Priscilla Ignacio (respondents) for rescission of their
Contract to Sell before the RTC, Branch 14, Malolos, Bulacan. The facts, drawn
from the records and outlined below, are not in dispute.
On April 30, 1998, CGA entered into a Contract to Sell a subdivision lot (subject
property) with the respondents – the registered owners and developers of a
housing subdivision known as Villa Priscilla Subdivision located in Barangay
Cutcut, Pulilan, Bulacan. Under the Contract to Sell, CGA would pay
P2,373,000.00 for the subject property on installment basis; they were to pay a
down payment of P1,186,500, with the balance payable within three years on
equal monthly amortization payments of P46,593.85, inclusive of interest at 24%
per annum, starting June 1998.
On August 5, 2000, the parties mutually agreed to amend the Contract to Sell to
extend the payment period from three to five years, calculated from the date of
purchase and based on the increased total consideration of P2,706,600, with
equal monthly installments of P37,615.00, inclusive of interest at 24% per annum,
starting September 2000.
According to CGA, it religiously paid the monthly installments until its
administrative pastor discovered that the title covering the subject property
suffered from fatal flaws and defects. CGA learned that the subject property was
actually part of two consolidated lots (Lots 2-F and 2-G Bsd-04-000829 [OLT]) that
the respondents had acquired from Nicanor Adriano (Adriano) and Ceferino Sison
(Sison), respectively. Adriano and Sison were former tenant-beneficiaries of
Purificacion S. Imperial (Imperial) whose property in Cutcut, Pulilan, Bulacan had
been placed under Presidential Decree (PD) No. 27’s Operation Land Transfer.
According to CGA, Imperial applied for the retention of five hectares of her land
under Republic Act No. 6657, which the Department of Agrarian Reform (DAR)
granted in its October 2, 1997 order (DAR Order). The DAR Order authorized
Imperial to retain the farm lots previously awarded to the tenant-beneficiaries,
including Lot 2-F previously awarded to Adriano, and Lot 2-G Bsd-04-000829
awarded to Sison. On appeal, the Office of the President and the CA upheld the
DAR Order. Through the Court’s Resolution dated January 19, 2005 in G.R. No.
165650, we affirmed the DAR Order by denying the petition for review of the
appellate decision.
Understandably aggrieved after discovering these circumstances, CGA filed a
complaint against the respondents before the RTC on April 30, 2002. CGA
claimed that the respondents fraudulently concealed the fact that the subject
property was part of a property under litigation; thus, the Contract to Sell was a
rescissible contract under Article 1381 of the Civil Code. CGA asked the trial court
to rescind the contract; order the respondents to return the amounts already paid;
and award actual, moral and exemplary damages, attorney’s fees and litigation
expenses.
Instead of filing an answer, the respondents filed a motion to dismiss asserting
that the RTC had no jurisdiction over the case. Citing PD No. 957 and PD No.
1344, the respondents claimed that the case falls within the exclusive jurisdiction
of the HLURB since it involved the sale of a subdivision lot. CGA opposed the
motion to dismiss, claiming that the action is for rescission of contract, not specific
performance, and is not among the actions within the exclusive jurisdiction of the
HLURB, as specified by PD No. 957 and PD No. 1344.
On October 15, 2002, the RTC issued an order denying the respondents’ motion
to dismiss. The RTC held that the action for rescission of contract and damages
due to the respondents’ fraudulent misrepresentation that they are the rightful
owners of the subject property, free from all liens and encumbrances, is outside
the HLURB’s jurisdiction.1avvphi1
The respondents countered by filing a petition for certiorari with the CA. In its
October 20, 2003 decision, the CA found merit in the respondents’ position and
set the RTC order aside; the CA ruled that the HLURB had exclusive jurisdiction
over the subject matter of the complaint since it involved a contract to sell a
subdivision lot based on the provisions of PD No. 957 and PD No. 1344.
Contending that the CA committed reversible error, the CGA now comes before
the Court asking us to overturn the CA decision and resolution.
THE PETITION
In its petition, CGA argues that the CA erred -
(1) in applying Article 1191 of the Civil Code for breach of reciprocal
obligation, while the petitioner’s action is for the rescission of a rescissible
contract under Article 1381 of the same Code, which is cognizable by the
regular court; and
(2) in holding that the HLURB has exclusive jurisdiction over the petitioner’s
action by applying Antipolo Realty Corp v. National Housing Corporation
and other cited cases.
In essence, the main issue we are asked to resolve is which of the two – the
regular court or the HLURB – has exclusive jurisdiction over CGA’s action for
rescission and damages.
According to CGA, the exclusive jurisdiction of the HLURB, as set forth in PD No.
1344 and PD No. 957, is limited to cases involving specific performance and does
not cover actions for rescission.
Taking the opposing view, respondents insist that since CGA’s case involves the
sale of a subdivision lot, it falls under the HLURB’s exclusive jurisdiction.
THE COURT’S RULING
We find no merit in the petition and consequently affirm the CA decision.
Development of the HLURB’s jurisdiction
The nature of an action and the jurisdiction of a tribunal are determined by the
material allegations of the complaint and the law governing at the time the action
was commenced. The jurisdiction of the tribunal over the subject matter or nature
of an action is conferred only by law, not by the parties’ consent or by their waiver
in favor of a court that would otherwise have no jurisdiction over the subject matter
or the nature of an action. Thus, the determination of whether the CGA’s cause of
action falls under the jurisdiction of the HLURB necessitates a closer examination
of the laws defining the HLURB’s jurisdiction and authority.
PD No. 957, enacted on July 12, 1976, was intended to closely supervise and
regulate the real estate subdivision and condominium businesses in order to curb
the growing number of swindling and fraudulent manipulations perpetrated by
unscrupulous subdivision and condominium sellers and operators. As one of its
"whereas clauses" states:
WHEREAS, reports of alarming magnitude also show cases of swindling and
fraudulent manipulations perpetrated by unscrupulous subdivision and
condominium sellers and operators, such as failure to deliver titles to the buyers
or titles free from liens and encumbrances, and to pay real estate taxes, and
fraudulent sales of the same subdivision lots to different innocent purchasers for
value;
Section 3 of PD No. 957 granted the National Housing Authority (NHA) the
"exclusive jurisdiction to regulate the real estate trade and business." Thereafter,
PD No. 1344 was issued on April 2, 1978 to expand the jurisdiction of the NHA to
include the following:
SECTION 1. In the exercise of its functions to regulate the real estate trade and
business and in addition to its powers provided for in Presidential Decree No. 957,
the National Housing Authority shall have exclusive jurisdiction to hear and decide
cases of the following nature:
A. Unsound real estate business practices;
 B. Claims involving refund and any other claims filed by subdivision lot or
condominium unit buyer against the project owner, developer, dealer,
broker or salesman; and
C. Cases involving specific performance of contractual and statutory
obligations filed by buyers of subdivision lot or condominium unit against
the owner, developer, dealer, broker or salesman.
Executive Order No. 648 (EO 648), dated February 7, 1981, transferred the
regulatory and quasi-judicial functions of the NHA to the Human Settlements
Regulatory Commission (HSRC). Section 8 of EO 648 provides:
SECTION 8. Transfer of Functions. -The regulatory functions of the National
Housing Authority pursuant to Presidential Decree Nos. 957, 1216, 1344 and
other related laws are hereby transferred to the Commission [Human Settlements
Regulatory Commission]. x x x. Among these regulatory functions are: 1)
Regulation of the real estate trade and business; x x x 11) Hear and decide cases
of unsound real estate business practices; claims involving refund filed against
project owners, developers, dealers, brokers, or salesmen; and cases of specific
performance.
Pursuant to Executive Order No. 90 dated December 17, 1986, the HSRC was
renamed as the HLURB.
Rationale for HLURB’s extensive quasi-judicial powers
The surge in the real estate business in the country brought with it an increasing
number of cases between subdivision owners/developers and lot buyers on the
issue of the extent of the HLURB’s exclusive jurisdiction. In the cases that
reached us, we have consistently ruled that the HLURB has exclusive jurisdiction
over complaints arising from contracts between the subdivision developer and the
lot buyer or those aimed at compelling the subdivision developer to comply with its
contractual and statutory obligations to make the subdivision a better place to live
in.
We explained the HLURB’s exclusive jurisdiction at length in Sps. Osea v.
Ambrosio, where we said:
Generally, the extent to which an administrative agency may exercise its powers
depends largely, if not wholly, on the provisions of the statute creating or
empowering such agency. Presidential Decree (P.D.) No. 1344, "Empowering The
National Housing Authority To Issue Writ Of Execution In The Enforcement Of Its
Decision Under Presidential Decree No. 957," clarifies and spells out the quasi-
judicial dimensions of the grant of jurisdiction to the HLURB in the following
specific terms:
SEC. 1. In the exercise of its functions to regulate the real estate trade and
business and in addition to its powers provided for in Presidential Decree No. 957,
the National Housing Authority shall have exclusive jurisdiction to hear and decide
cases of the following nature:
A. Unsound real estate business practices;
B. Claims involving refund and any other claims filed by subdivision lot or
condominium unit buyer against the project owner, developer, dealer,
broker or salesman; and
C. Cases involving specific performance of contractual and statutory
obligations filed by buyers of subdivision lots or condominium units against
the owner, developer, dealer, broker or salesman.
The extent to which the HLURB has been vested with quasi-judicial authority must
also be determined by referring to the terms of P.D. No. 957, "The Subdivision
And Condominium Buyers' Protective Decree." Section 3 of this statute provides:
x x x National Housing Authority [now HLURB]. - The National Housing Authority
shall have exclusive jurisdiction to regulate the real estate trade and business in
accordance with the provisions of this Decree.
The need for the scope of the regulatory authority thus lodged in the HLURB is
indicated in the second, third and fourth preambular paragraphs of PD 957 which
provide:
WHEREAS, numerous reports reveal that many real estate subdivision owners,
developers, operators, and/or sellers have reneged on their representations and
obligations to provide and maintain properly subdivision roads, drainage,
sewerage, water systems, lighting systems, and other similar basic requirements,
thus endangering the health and safety of home and lot buyers;
WHEREAS, reports of alarming magnitude also show cases of swindling and
fraudulent manipulations perpetrated by unscrupulous subdivision and
condominium sellers and operators, such as failure to deliver titles to the buyers
or titles free from liens and encumbrances, and to pay real estate taxes, and
fraudulent sales of the same subdivision lots to different innocent purchasers for
value;
xxxx
WHEREAS, this state of affairs has rendered it imperative that the real estate
subdivision and condominium businesses be closely supervised and regulated,
and that penalties be imposed on fraudulent practices and manipulations
committed in connection therewith.
The provisions of PD 957 were intended to encompass all questions regarding
subdivisions and condominiums. The intention was aimed at providing for an
appropriate government agency, the HLURB, to which all parties aggrieved in the
implementation of provisions and the enforcement of contractual rights with
respect to said category of real estate may take recourse. The business of
developing subdivisions and corporations being imbued with public interest and
welfare, any question arising from the exercise of that prerogative should be
brought to the HLURB which has the technical know-how on the matter. In the
exercise of its powers, the HLURB must commonly interpret and apply contracts
and determine the rights of private parties under such contracts. This ancillary
power is no longer a uniquely judicial function, exercisable only by the regular
courts.
As observed in C.T. Torres Enterprises, Inc. v. Hibionada:
The argument that only courts of justice can adjudicate claims resoluble under the
provisions of the Civil Code is out of step with the fast-changing times. There are
hundreds of administrative bodies now performing this function by virtue of a valid
authorization from the legislature. This quasi-judicial function, as it is called, is
exercised by them as an incident of the principal power entrusted to them of
regulating certain activities falling under their particular expertise.
In the Solid Homes case for example the Court affirmed the competence of the
Housing and Land Use Regulatory Board to award damages although this is an
essentially judicial power exercisable ordinarily only by the courts of justice. This
departure from the traditional allocation of governmental powers is justified by
expediency, or the need of the government to respond swiftly and competently to
the pressing problems of the modern world. [Emphasis supplied.]
Another case – Antipolo Realty Corporation v. NHA – explained the grant of the
HLURB’s expansive quasi-judicial powers. We said:
In this era of clogged court dockets, the need for specialized administrative boards
or commissions with the special knowledge, experience and capability to hear and
determine promptly disputes on technical matters or essentially factual matters,
subject to judicial review in case of grave abuse of discretion, has become well
nigh indispensable. Thus, in 1984, the Court noted that ‘between the power
lodged in an administrative body and a court, the unmistakable trend has been to
refer it to the former’.
xxx
In general, the quantum of judicial or quasi-judicial powers which an administrative
agency may exercise is defined in the enabling act of such agency. In other
words, the extent to which an administrative entity may exercise such powers
depends largely, if not wholly on the provisions of the statute creating or
empowering such agency. In the exercise of such powers, the agency concerned
must commonly interpret and apply contracts and determine the rights of private
parties under such contracts, One thrust of the multiplication of administrative
agencies is that the interpretation of contracts and the determination of private
rights thereunder is no longer a uniquely judicial function, exercisable only by our
regular courts. [Emphasis supplied.]
Subdivision cases under the RTC’s jurisdiction
The expansive grant of jurisdiction to the HLURB does not mean, however, that all
cases involving subdivision lots automatically fall under its jurisdiction. As we said
in Roxas v. Court of Appeals:
In our view, the mere relationship between the parties, i.e., that of being
subdivision owner/developer and subdivision lot buyer, does not automatically
vest jurisdiction in the HLURB. For an action to fall within the exclusive jurisdiction
of the HLURB, the decisive element is the nature of the action as enumerated in
Section 1 of P.D. 1344. On this matter, we have consistently held that the
concerned administrative agency, the National Housing Authority (NHA) before
and now the HLURB, has jurisdiction over complaints aimed at compelling the
subdivision developer to comply with its contractual and statutory obligations.
xxx
Note particularly pars. (b) and (c) as worded, where the HLURB’s jurisdiction
concerns cases commenced by subdivision lot or condominium unit buyers. As to
par. (a), concerning "unsound real estate practices," it would appear that the
logical complainant would be the buyers and customers against the sellers
(subdivision owners and developers or condominium builders and realtors ), and
not vice versa. [Emphasis supplied.]
Pursuant to Roxas, we held in Pilar Development Corporation v. Villar and Suntay
v. Gocolay that the HLURB has no jurisdiction over cases filed by subdivision or
condominium owners or developers against subdivision lot or condominium unit
buyers or owners. The rationale behind this can be found in the wordings of Sec.
1, PD No. 1344, which expressly qualifies that the cases cognizable by the
HLURB are those instituted by subdivision or condomium buyers or owners
against the project developer or owner. This is also in keeping with the policy of
the law, which is to curb unscrupulous practices in the real estate trade and
business. Thus, in the cases of Fajardo Jr. v. Freedom to Build, Inc., and Cadimas
v. Carrion, we upheld the RTC’s jurisdiction even if the subject matter was a
subdivision lot since it was the subdivision developer who filed the action against
the buyer for violation of the contract to sell.
The only instance that HLURB may take cognizance of a case filed by the
developer is when said case is instituted as a compulsory counterclaim to a
pending case filed against it by the buyer or owner of a subdivision lot or
condominium unit. This was what happened in Francel Realty Corporation v.
Sycip, where the HLURB took cognizance of the developer’s claim against the
buyer in order to forestall splitting of causes of action.
Obviously, where it is not clear from the allegations in the complaint that the
property involved is a subdivision lot, as in Javellana v. Hon. Presiding Judge,
RTC, Branch 30, Manila, the case falls under the jurisdiction of the regular courts
and not the HLURB. Similarly, in Spouses Dela Cruz v. Court of Appeals, we held
that the RTC had jurisdiction over a case where the conflict involved a subdivision
lot buyer and a party who owned a number of subdivision lots but was not himself
the subdivision developer.
The Present Case
In the present case, CGA is unquestionably the buyer of a subdivision lot from the
respondents, who sold the property in their capacities as owner and developer. As
CGA stated in its complaint:
2.01. Defendants are the registered owners and developers of a housing
subdivision presently known as Villa Priscilla Subdivision located at Brgy.
Cutcut, Pulilan, Bulacan;
2.02 On or about April 30, 1998, the plaintiff thru its Administrative Pastor
bought from defendants on installment basis a parcel of land designated
at Lot 1, Block 4 of the said Villa Priscilla Subdivision xxx
xxx
2.04 At the time of the execution of the second Contract to Sell (Annex
"B"), Lot 1, Block 4 of the Villa Priscilla Subdivision was already covered
by Transfer Certificate of Title No. T-127776 of the Registry of Deeds of
Quezon City in the name of Iluminada T. Soneja, married to Asterio
Soneja (defendant Priscilla T. Ignacio’s sister and brother-in-law) and the
defendants as co-owners, but the latter represented themselves to be the
real and absolute owners thereof, as in fact it was annotated in the title
that they were empowered to sell the same. Copy of TCT No. T-127776 is
hereto attached and made part hereof as Annex "C".
2.05 Plaintiff has been religiously paying the agreed monthly installments
until its Administrative Pastor discovered recently that while apparently
clean on its face, the title covering the subject lot actually suffers from
fatal flaws and defects as it is part of the property involved in litigation
even before the original Contract to Sell (Annex "A"), which defendants
deliberately and fraudulently concealed from the plaintiff;
2.06 As shown in the technical description of TCT No. T-127776 (Annex
"C"), it covers a portion of consolidated Lots 2-F and 2-G Bsd-04-000829
(OLT), which were respectively acquired by defendants from Nicanor
Adriano and Ceferino Sison, former tenants-beneficiaries of Purificacion
S. Imperial, whose property at Cutcut, Pulilan, Bulacan originally covered
by TCT No. 240878 containing an area of 119,431 square meters was
placed under Operation Land Transfer under P.D. No. 27;
2.07 Said Purificacion S. Imperial applied for retention of five (5) hectares
of her property at Cutcut, Pulilan, Bulacan under Rep, Act No. 6657 and
the same was granted by the Department of Agrarian Reform (DAR) to
cover in whole or in part farm lots previously awarded to tenants-
beneficiaries, including inter alia Nicanor Adriano’s Lot 2-F and Ceferino
Sison’s Lot 2-G Bsd-04-000829 (OLT).
xxx
2.08 Said order of October 2, 1997 was affirmed and declared final and
executory, and the case was considered closed, as in fact there was
already an Implementing Order dated November 10, 1997.
xxx
3.03 As may thus be seen, the defendants deliberately and fraudulently
concealed from the plaintiff that fact that the parcel of land sold to the
latter under the Contract to Sell (Annexes "A" and "B") is part of the
property already under litigation and in fact part of the five-hectare
retention awarded to the original owner, Purificacion S. Imperial.
xxx
3.05 Plaintiff is by law entitled to the rescission of the Contracts to Sell
(Annexes "A" and "B") by restitution of what has already been paid to date
for the subject property in the total amount of P2,515,899.20, thus formal
demand therefor was made on the defendants thru a letter dated April 5,
2002, which they received but refused to acknowledge receipt. Copy of
said letter is hereto attached and made part hereof as Annex "J".
[Emphasis supplied.]
From these allegations, the main thrust of the CGA complaint is clear – to compel
the respondents to refund the payments already made for the subject property
because the respondents were selling a property that they apparently did not own.
In other words, CGA claims that since the respondents cannot comply with their
obligations under the contract, i.e., to deliver the property free from all liens and
encumbrances, CGA is entitled to rescind the contract and get a refund of the
payments already made. This cause of action clearly falls under the actions
contemplated by Paragraph (b), Section 1 of PD No. 1344, which reads:
SEC. 1. In the exercise of its functions to regulate the real estate trade and
business and in addition to its powers provided for in Presidential Decree No. 957,
the National Housing Authority shall have exclusive jurisdiction to hear and decide
cases of the following nature:
xxx
B. Claims involving refund and any other claims filed by subdivision lot or
condominium unit buyer against the project owner, developer, dealer,
broker or salesman; and
We view CGA’s contention – that the CA erred in applying Article 1191 of the Civil
Code as basis for the contract’s rescission – to be a negligible point. Regardless
of whether the rescission of contract is based on Article 1191 or 1381 of the Civil
Code, the fact remains that what CGA principally wants is a refund of all payments
it already made to the respondents. This intent, amply articulated in its complaint,
places its action within the ambit of the HLURB’s exclusive jurisdiction and outside
the reach of the regular courts. Accordingly, CGA has to file its complaint before
the HLURB, the body with the proper jurisdiction.
WHEREFORE, premises considered, we DENY the petition and AFFIRM the
October 20, 2003 Decision of the Court of Appeals in CA G.R. SP No. 75717
dismissing for lack of jurisdiction the CGA complaint filed with the RTC, Branch 14
of Malolos, Bulacan.
SO ORDERED.
G.R. No. 106498 June 28, 1993
LOLITA DADUBO, petitioner,
vs.
CIVIL SERVICE COMMISSION and the DEVELOPMENT BANK OF THE
PHILIPPINES, respondents.
Francisco P. Duran for petitioner.
CRUZ, J.:
Petitioner Lolita A. Dadubo, Senior Accounts Analyst and Rosario B. Cidro, Cash
Supervisor, of the Development Bank of the Philippines, Borongan Branch were
administratively charged with conduct prejudicial to the best interest of the
service. The charges were based on reports on the unposted withdrawal of
P60,000.00 from Savings Account No. 87-692 in the name of Eric Tiu, Edgar Tiu,
and/or Pilar Tiu.
The formal investigations revealed that in the morning of August 13, 1987, Erlinda
Veloso, authorized representative of the Tius, presented an undated withdrawal
slip for P60,000.00. Dadubo, as acting teller, prepared the corresponding ticket
and voucher in the name of the cash supervisor, Rosario Cidro. Dadubo initialed
the withdrawal slip, ticket and voucher, all dated August 13, 1987, and passed on
to Cidro all the documents on the said transaction. These were then forwarded to
the accountant, Reynaldo Dorado, who signed the voucher ledger card of the
Tius' savings account and forwarded the documents to Apolinario Babaylon,
bookkeeper, who was also acting as posting machine operator. After posting the
amount of P60,000.00 on the ledger card and passbook, Babaylon initialed the
withdrawal slip and returned the documents to Dorado, who approved the
withdrawal and thereafter disbursed the P60,000.00 to Veloso. The Received
payment portion of the withdrawal slip was signed Veloso but Cidro, who
disbursed the amount, failed to initial the passbook.
After banking hours, another withdrawal slip was presented by Feliciano Bugtas,
Jr., also an employee of the Tius. This was the second P60,000.00 withdrawal.
Veloso did not know about it. The withdrawal slip was processed and approved on
the same day, August 13, 1987. The space Posted by was initialed by Babaylon
but no posting was actually made because the passbook was not presented.
While the withdrawal slip was dated August 13, 1987, all other supporting
documents were dated August 14, 1987, this being a withdrawal after banking
hours (ABH).
The following day, August 14, 1987, prior to the payment of the ABH withdrawal,
Veloso presented another undated withdrawal slip for P60,000.00. This was the
third P60,000.00 withdrawal. The withdrawal slip was received by Dorado, who
handed it to Dadubo. At that time, Cidro was encashing the check at PNB to
satisfy the ABH withdrawal. When she returned from the bank, she paid this
withdrawal to Veloso, who thought that what she was collecting was the
P60,000.00 corresponding to the withdrawal slip she presented that morning.
When Dadubo informed Cidro about the third withdrawal, till money of
P100,000.00 was made to service it. Prior to the payment of the third P60,000.00
withdrawal, Veloso came back and presented another withdrawal slip for
P40,000.00. The petitioner claimed she disbursed P100,000.00 to Veloso,
covering the third P60,000.00 and the P40,000.00 withdrawals. On the other
hand, Veloso testified that she received only P40,000.00 from the petitioner. She
acknowledged receipt of the amount by signing the withdrawal slip and indicating
opposite her signature the amount of P40,000.00.
That left the balance of P60,000.00 unaccounted for and directly imputable to
Dadubo.
On the basis of these findings, DBP found Dadubo guilty of dishonesty for
embezzlement of bank funds. She was penalized with dismissal from the
service. Cidro was adjudged guilty of gross neglect of duty and fined in an amount
equivalent to one month basic salary, payable through salary deductions in not
more than 12 installments.
Dadubo appealed to the Merit Systems Protection Board (MSPB), which affirmed
the decision of the DBP, declaring as follows:
There is nothing in the records to show that the Senior Manager, Personnel
Services and Vice-Chairman, both of the DBP, abused their discretion in
deciding the case against the appellant or that their decision was made and
attended with arbitrariness or unfairness. To all intents and purposes, the
ensuing decision was a necessary consequence of the evidence.
However, DBP was reversed by the Civil Service Commission in its Resolution
No. 91-642, dated May 21, 1991, which reduced Dadubo's penalty to suspension
for six months on the ground that:
Although Dadubo made alterations on the dates in the Ledger Card from
August 13 to August 14, the fact remains that the bank was defrauded on
account of said ABH withdrawal (for) which Cidro is held responsible and
accordingly found guilty of Gross Neglect of Duty and Inefficiency and
Incompetence in the Performance of Official Duty. It was also Dadubo who
reported on the irreconcilable P60,000.00. The most that Dadubo could be
charged with is willful violation of office regulation when she undertook
reconciliation for under the Bank Manual the tellers are not allowed access
to the savings account ledger cards.
Respondent DBP moved reconsideration. On July 16, 1992, the Commission
acting favorably on the motion, promulgated Resolution No.
92-878 affirming the earlier findings of the DBP as to Dadubo guilt, thus —
The records reveal that Dadubo admitted in her Answer that she changed
entry of the date August 13 to 14 in the ledger in the course of her
reconciliation which she was advised not to do.
xxx xxx xxx
This act of admission needs no further elaboration to prove that Dadubo is
guilty of the charge. Such admission is however treated as a mitigating
circumstance which is offset by the aggravating circumstance of taking
advantage of her official position. There is no reason for her to change or
alter entries in the ledger unless she intends to benefit therefrom or to
conceal some facts.
Further, it should be noted that the report was made only on September 28,
1987 (the date the report on reconciliation was submitted to the Regional
Office). It should be emphasized as earlier stated that Dadubo was not
authorized to reconcile the subsidiary ledger cards for the period ending
August 20, 1987. Hence, as emphatically stated in the MSPB decision, ". . .
respondent Dadubo manipulated the bank records to conceal the offense
which constituted the act of dishonesty."
The opinion of an acting Internal Audit Officer, whose report was among the
preliminary findings considered in the investigation of the case, is not
conclusive as there are other available and convincing evidence to prove
the guilt of Dadubo.
Dadubo has brought her case to this Court in this petition for certiorari. She claims
that CSC Resolution No. 92-878 failed to comply with the constitutional
requirement to state clearly and distinctly the facts an the law on which the
decision is based; CSC Resolution No. 92-878 conflicts with the findings of fact in
CSC Resolution No. 91-642; the Commission manifestly overlooked or
disregarded certain relevant facts not disputed by the parties; and it based its
conclusions entirely on speculations, surmises or conjectures.
Required to comment, the Solicitor General argued that CSC Resolution No. 92-
878 did not need to restate the legal and factual bases of the original decision in
CSC-MSPB No. 497 which already explained the relevant facts and the applicable
law. The petitioner had admitted that she changed the entry of the dates in the
subsidiary ledger card from August 13 to 14 in the course of her reconciliation
work although she was not authorized to do this. This admission, along with the
other evidence Presented during the investigation in the bank, proved Dadubo's
guilt. Moreover, the affidavit of Albert C. Ballicud was inadmissible in evidence
because he was never subjected to cross-examination.
The petitioner's challenges are mainly factual. The rule is that the findings of fact
of administrative bodies, if based on substantial evidence, are controlling on the
reviewing authority. is settled that it is not for the appellate court to substitute its
own judgment for that of the administrative agency on the sufficiency of the
evidence and the credibility of the witnesses. Administrative decisions on matters
within their jurisdiction are entitled to respect and can only be set aside on proof of
grave abuse of discretion, fraud or error of law. None of these vices has been
shown in this case.
The petitioner's invocation of due process is without merit. Her complaint that she
was not sufficiently informed of the charges against her has no basis. While the
rules governing Judicial trials should be observed as much as possible, their strict
observance is not indispensable in administrative cases. As this Court has held,
"the standard of due process that must be met in administrative tribunals allows a
certain latitude as long as the element of fairness is not ignored."
The essence of due process is distilled in the immortal cry of Themistocles to
Eurybiades: "Strike, but hear me first!" Less dramatically, it simply connotes an
opportunity to be heard. The petitioner had several opportunities to be heard and
to present evidence that she was not guilty of embezzlement but only of failure to
comply with the tellering procedure. Not only did she testify at her formal
investigation but she also filed a motion for reconsideration with the DBP, then
appealed to the Merit Systems Protection Board (MSPB), and later elevated the
case to the Civil Service Commission. Having been given all these opportunities to
be heard, which she fully availed of, she cannot now complain that she was
denied due process.
Appreciation of the evidence submitted by the parties was, to repeat, the
prerogative of the administrative body, subject to reversal only upon a clear
showing of arbitrariness. The rejection of the affidavit of Ballicud, for example, was
not improper because there was nothing in that document showing that the
petitioner did not embezzle the P60,000.00.
It is true that the petitioner was formally charged with conduct prejudicial to the
best interest of the bank and not specifically with embezzlement. Nevertheless,
the allegations and the evidence presented sufficiently proved her guilt of
embezzlement of bank funds, which in unquestionably prejudicial to the best 4 Annex "E," id., pp. 38; 57.
interest of the bank.
5 Id., p. 60.
The charge against the respondent in an administrative case need not be drafted
with the precision of an information in a criminal prosecution. It is sufficient that he 6 Id., p. 62.
is apprised of the substance of the charge against him; what is controlling is the
allegation of the acts complained of, not the designation of the offense. 7 Id., pp. 110-120.

We must also dismiss the petitioner's complaint that CSC Resolution No. 92-878
failed to comply with the constitutional requirement to state clearly and distinctly
the facts and the law on which a decision is based. We have held that this
provision applies only to courts of justice and not to administrative bodies like the
Civil Service Commission. In any event, there was an earlier statement of the
facts and the law involved in the decision rendered by the MSPB dated February
28, 1990, which affirmed DBP's decision to dismiss the petitioner. In both
decisions, the facts and the law on which they were based were clearly and
distinctly stated.
It is worth adding that inasmuch as Civil Service Resolution No. 92-878 was
rendered only to resolve DBP's motion for reconsideration, it was not really
necessary to re-state the factual an, legal bases for the said decisions. Even
resolutions issued by this Court do not need to conform, to the first paragraph of
Article VIII, Section 14, of the Constitution, for reasoning extensively discussed
in Borromeo v. Court of Appeals and other subsequent cases.
8 Id., pp. 31-35.
9 Id., pp. 27-30.
10 Jaculina v. National Police Commission, 200 SCRA 489; Biak-na-Bato
Mining Co. v. Tanco, Jr., 193 SCRA 323; Doruelo v. Ministry of National
Defense, 169 SCRA 448.
11 Assistant Executive Secretary for Legal Affairs of the Office of the
President v. Court of Appeals, 169 SCRA 27; Lao Tang Bun v. Fabre, 81
Phil. 682.
12 Apex Mining Co., Inc. v. Garcia, 199 SCRA 278; Greenhills Mining Co. v.
Office of the President, 163 SCRA 350; Lovina v. Moreno, 9 SCRA 557;
Timbancaya v. Vicente, 9 SCRA 852.

We find no justification to nullify or modify the questioned resolution. It would 13 Bautista v. Secretary of Labor and Employment, 196 SCRA 470.
perhaps have been more thorough if certain other officers of the bank had been
also investigated for their part in the anomalous transaction. But that matter is not 14 Adamson and Adamson, Inc. v. Amores, 152 SCRA 237; Gas Corp. of
before this Court and cannot be resolved by us at this time. the Phil. v. Inciong, 93 SCRA 653.

WHEREFORE, the petition is DISMISSED for lack of a clear showing of grave
abuse of discretion on the part of the Civil Service Commission in issuing the
questioned resolutions. Costs against the petitioner.
SO ORDERED.
15 Heirs of Celso Amarante v. Court of Appeals, 185 SCRA 585; Eugenio,
Sr. v. Velez, 185 SCRA 425.
16 Prudential Bank v. Castro, 158 SCRA 646; Buscayno v. Enrile, 102
SCRA 7; Mangca v. Commission on Elections, 112 SCRA 273.

Narvasa, C.J., Feliciano, Bidin, Griño-Aquino, Regalado, Davide, Jr., Romero, 17 186 SCRA 1.
Nocon, Bellosillo, Melo and Quiazon, JJ., concur.
18 Candelaria v. Court of Appeals, G.R. No. 93685, August 20, 1990 (Min.
Padilla, J., is on leave. Resolution); Nicos Industrial Corporation v. Court of Appeals, 206 SCRA
127.
# Footnotes

1 Annex "I," Rollo, p.44.

2 Annex "C," Ibid., pp. 36; 55-56.

3 Annex "D," Id., pp. 37; 56.

 G.R. No. L-30637 July 16, 1987
LIANGA BAY LOGGING, CO., INC., petitioner,
vs.
HON. MANUEL LOPEZ ENAGE, in his capacity as Presiding Judge of Branch
II of the Court of First, Instance of Agusan, and AGO TIMBER
CORPORATION, respondents.
TEEHANKEE, C.J.:
The Court grants the petition for certiorari and prohibition and holds that
respondent judge, absent any showing of grave abuse of discretion, has no
competence nor authority to review anew the decision in administrative
proceedings of respondents public officials (director of forestry, secretary of
agriculture and natural resources and assistant executive secretaries of the Office
of the President) in determining the correct boundary line of the licensed timber
areas of the contending parties. The Court reaffirms the established principle that
findings of fact by an administrative board or agency or official, following a
hearing, are binding upon the courts and will not be disturbed except where the
board, agency and/or official(s) have gone beyond their statutory authority,
exercised unconstitutional powers or clearly acted arbitrarily and without regard to
their duty or with grave abuse of discretion.
The parties herein are both forest concessionaries whose licensed areas are
adjacent to each other. The concession of petitioner Lianga Bay Logging
Corporation Co., Inc. (hereinafter referred to as petitioner Lianga) as described in
its Timber License Agreement No. 49, is located in the municipalities of Tago,
Cagwait, Marihatag and Lianga, all in the Province of Surigao, consisting of
110,406 hectares, more or less, while that of respondent Ago Timber Corporation
(hereinafter referred to as respondent Ago) granted under Ordinary Timber
License No. 1323-60 [New] is located at Los Arcos and San Salvador, Province of
Agusan, with an approximate area of 4,000 hectares. It was a part of a forest area
of 9,000 hectares originally licensed to one Narciso Lansang under Ordinary
Timber License No. 584-'52.
Since the concessions of petitioner and respondent are adjacent to each other,
they have a common boundary-the Agusan-Surigao Provincial boundary-whereby
the eastern boundary of respondent Ago's concession is petitioner Lianga's
western boundary. The western boundary of petitioner Lianga is described as "...
Corner 5, a point in the intersection of the Agusan-Surigao Provincial boundary
and Los Arcos-Lianga Road; thence following Agusan-Surigao Provincial
boundary in a general northerly and northwesterly and northerly directions about
39,500 meters to Corner 6, a point at the intersection of the Agusan-Surigao
Provincial boundary and Nalagdao Creek ..." The eastern boundary of respondent
Ago's concession is described as "... point 4, along the Agusan-Surigao boundary;
thence following Agusan-Surigao boundary in a general southeasterly and
southerly directions about 12,000 meters to point 5, a point along Los Arcos-
Lianga Road; ..."
Because of reports of encroachment by both parties on each other's concession
areas, the Director of Forestry ordered a survey to establish on the ground the
common boundary of their respective concession areas. Forester Cipriano
Melchor undertook the survey and fixed the common boundary as "Corner 5 of
Lianga Bay Logging Company at Km. 10.2 instead of Km. 9.7 on the Lianga-Arcos
Road and lines N900E, 21,000 meters; N12 W, 21,150 meters; N40 W, 3,000
meters; N31 W, 2,800 meters; N50 W, 1,700 meters" which respondent Ago
protested claiming that "its eastern boundary should be the provincial boundary
line of Agusan-Surigao as described in Section 1 of Art. 1693 of the Philippine
Commission as indicated in the green pencil in the attached sketch" of the areas
as prepared by the Bureau of Forestry. The Director of Forestry, after considering
the evidence, found:
That the claim of the Ago Timber Corporation portrays a line (green line) far
different in alignment with the line (red) as indicated in the original License
Control Map of this Office;
That the claim of the Ago Timber Corporation (green line does not conform
to the distance of 6,800 meters from point 3 to point 4 of the original
description of the area of Narciso Lansang but would project said line to a
distance of approximately 13,800 meters;
That to follow the claim of the Ago Timber Corporation would increase the
area of Narciso Lansang from 9,000 to 12,360 hectares;
That to follow the claim of the Ago Timber Corporation would reduce the
area of the Lianga Bay Logging, Co., Inc. to 107,046 hectares instead of
the area granted which is 110,406 hectares.
and ruled that "the claim of the Ago Timber Corporation runs counter to the
intentions of this Office is granting the license of Mr. Narciso Lansang; and further,
that it also runs counter to the intentions of this Office in granting the Timber
License Agreement to the Lianga Bay Logging Co., Inc. The intentions of this
Office in granting the two licenses (Lansang and Lianga Bay Logging Co., Inc.)
are patently manifest in that distances and bearings are the controlling factors. If
mention was ever made of the Agusan-Surigao boundary, as the common
boundary line of both licensees, this Office could not have meant the Agusan-
Surigao boundary as described under Section 1 of Act 1693 of the Philippine
Commission for were it so it could have been so easy for this Office to mention the
distance from point 3 to point 4 of Narciso Lansang as approximately 13,800
meters. This cannot be considered a mistake considering that the percentage of
error which is more or less 103% is too high an error to be committed by an Office
manned by competent technical men. The Agusan-Surigao boundary as
mentioned in the technical descriptions of both licensees, is, therefore, patently an
imaginary line based on B.F. License Control Map. Such being the case, it
is reiterated that distance and bearings control the description where an imaginary
line exists. The decision fixed the common boundary of the licensed areas of the
Ago Timber Corporation and Lianga Bay Logging Co., Inc. as that indicated in red
pencil of the sketch attached to the decision.
In an appeal interposed by respondent Ago, docketed in the Department of
Agriculture and Natural Resources as DANR Case No. 2268, the then Acting
Secretary of Agriculture and Natural Resources Jose Y. Feliciano, in a decision
dated August 9, 1965 set aside the appealed decision of the Director of Forestry
and ruled that "(T)he common boundary line of the licensed areas of the Ago
Timber Corporation and the Lianga Bay Logging Co., Inc., should be that
indicated by the green line on the same sketch which had been made an integral
part of the appealed decision."
Petitioner elevated the case to the Office of the President, where in a decision
dated June 16, 1966, signed by then Assistant Executive Secretary Jose J. Leido,
Jr., the ruling of the then Secretary of Agriculture and Natural Resources was
affirmedOn motion for reconsideration, the Office of the President issued another
decision dated August 9, 1968 signed by then Assistant Executive Secretary
Gilberto Duavit reversing and overturning the decision of the then Acting
Secretary of Agriculture and Natural Resources and affirming in toto and
reinstating the decision, dated March 20, 1961, of the Director of Forestry
Respondent Ago filed a motion for reconsideration of the decision dated August 9,
1968 of the Office of the President but after written opposition of petitioner Lianga,
the same was denied in an order dated October 2, 1968, signed by then Assistant
Executive Secretary Jose J. Leido, Jr.
On October 21, 1968, a new action was commenced by Ago Timber Corporation,
as plaintiff, in the Court of First Instance of Agusan, Branch II, docketed thereat as
Civil Case No. 1253, against Lianga Bay Logging Co., Inc., Assistant Executive
Secretaries Jose J. Leido, Jr. and Gilberto M. Duavit and Director of Forestry, as
defendants, for "Determination of Correct Boundary Line of License Timber Areas
and Damages with Preliminary Injunction" reiterating once more the same
question raised and passed upon in DANR Case No. 2268 and insisting that "a
judicial review of such divergent administrative decisions is necessary in order to
determine the correct boundary fine of the licensed areas in question."
As prayed for, respondent judge issued a temporary restraining order on October
28, 1968, on a bond of P20,000, enjoining the defendants from carrying out the
decision of the Office of the President. The corresponding writ was issued the next
day, or on October 29, 1968.
On November 10, 1968, defendant Lianga (herein petitioner) moved for dismissal
of the complaint and for dissolution of the temporary restraining order on grounds
that the complaint states no cause of action and that the court has no jurisdiction
over the person of respondent public officials and respondent corporation. It also
submitted its opposition to plaintiff's (herein respondent prayer for the issuance of
a writ of preliminary injunction.
On December 19, 1968, the lower court issued an order denying petitioner
Lianga's motion to dismiss and granting the writ of preliminary injunction prayed
for by respondent Ago. Lianga's Motion for Reconsideration of the Order was
denied on May 9, 1969. Hence, this petition praying of the Court (a) to declare
that the Director of Forestry has the exclusive jurisdiction to determine the
common boundary of the licensed areas of petitioners and respondents and that
the decision of the Office of the President dated August 9, 1968 is final and
executory; (b) to order the dismissal of Civil Case No. 1253 in the Court of First
Instance of Agusan; (c) to declare that respondent Judge acted without jurisdiction
or in excess of jurisdiction and with grave abuse of discretion, amounting to lack of
jurisdiction, in issuing the temporary restraining order dated October 28, 1968 and
granting the preliminary injunction per its Order dated December 19, 1968; and (d)
to annul the aforementioned orders.
After respondent's comments on the petition and petitioner's reply thereto, this
Court on June 30, 1969 issued a restraining order enjoining in turn the
enforcement of the preliminary injunction and related orders issued by the
respondent court in Civil Case No. 1253.
The Court finds merit in the petition.
Respondent Judge erred in taking cognizance of the complaint filed by
respondent Ago, asking for the determination anew of the correct boundary fine of
its licensed timber area, for the same issue had already been determined by the
Director of Forestry, the Secretary of Agriculture and Natural Resources and the
Office of the President, administrative officials under whose jurisdictions the
matter properly belongs. Section 1816 of the Revised Administrative Code vests
in the Bureau of Forestry, the jurisdiction and authority over the demarcation,
protection, management, reproduction, reforestation, occupancy, and use of all
public forests and forest reserves and over the granting of licenses for game and
fish, and for the taking of forest products, including stone and earth therefrom. The
Secretary of Agriculture and Natural Resources, as department head, may repeal
or in the decision of the Director of Forestry when advisable in the public
interests, whose decision is in turn appealable to the Office of the President.
In giving due course to the complaint below, the respondent court would
necessarily have to assess and evaluate anew all the evidence presented in the
administrative proceedings, which is beyond its competence and jurisdiction. For
the respondent court to consider and weigh again the evidence already presented
and passed upon by said officials would be to allow it to substitute its judgment for
that of said officials who are in a better position to consider and weigh the same in
the light of the authority specifically vested in them by law. Such a posture cannot
be entertained, for it is a well-settled doctrine that the courts of justice will
generally not interfere with purely administrative matters which are addressed to
the sound discretion of government agencies and their expertise unless there is a
clear showing that the latter acted arbitrarily or with grave abuse of discretion or
when they have acted in a capricious and whimsical manner such that their action
may amount to an excess or lack of jurisdiction.
A doctrine long recognized is that where the law confines in an administrative
office the power to determine particular questions or matters, upon the facts to be
presented, the jurisdiction of such office shall prevail over the courts.
The general rule, under the principles of administrative law in force in this
jurisdiction, is that decisions of administrative officers shall not be disturbed by the
courts, except when the former have acted without or in excess of their
jurisdiction, or with grave abuse of discretion. Findings of administrative officials
and agencies who have acquired expertise because their jurisdiction is confined
to specific matters are generally accorded not only respect but at times even
finality of such findings are supported by substantial evidence. As recently
stressed by the Court, "in this era of clogged court dockets, the need for
specialized administrative boards or commissions with the special knowledge,
experience and capability to hear and determine promptly disputes on technical
matters or essentially factual matters, subject to judicial review in case of grave
abuse of discretion, has become well nigh indispensable."
The facts and circumstances in the instant case are similar to the earlier case
of Pajo, et al. v. Ago, et al. (where therein respondent Pastor Ago is the president
of herein respondent Ago Timber Corporation). In the said case, therein
respondent Pastor Ago, after an adverse decision of the Director of Forestry,
Secretary of Agriculture and Natural Resources and Executive Secretary in
connection with his application for renewal of his expired timber licenses, filed with
the Court of First instance of Agusan a petition for certiorari, prohibition and
damages with preliminary injunction alleging that the rejection of his application for
renewal by the Director of Forestry and Secretary of Agriculture and Natural
Resources and its affirmance by the Executive Secretary constituted an abuse of
discretion and was therefore illegal. The Court held that "there can be no question
that petitioner Director of Forestry has jurisdiction over the grant or renewal of
respondent Ago's timber license (Sec. 1816, Rev. Adm. Code); that petitioner
Secretary of Agriculture and Natural Resources as department head, is
empowered by law to affirm, modify or reject said grant or renewal of respondent
Ago's timber license by petitioner Director of Forestry (Sec. 79[c], Rev. Adm.
Code); and that petitioner Executive Secretary, acting for and in behalf and by
authority of the President has, likewise, jurisdiction to affirm, modify or reverse the
orders regarding the grant or renewal of said timber license by the two
aforementioned officials." The Court went on to say that, "(I)n the case of
Espinosa, et al. v. Makalintal, et al. (79 Phil. 134; 45 Off. Gaz. 712), we held that
the powers granted to the Secretary of Agriculture and Commerce (Natural
Resources) by law regarding the disposition of public lands such as granting of
licenses, permits, leases, and contracts or approving, rejecting, reinstating, or
cancelling applications or deciding conflicting applications, are all executive and
administrative in nature. It is a well-recognized principle that purely administrative
and discretionary functions may not be interfered with by the courts. In general,
courts have no supervising power over the proceedings and actions of the
administrative departments of the government. This is generally true with respect
to acts involving the exercise of judgment or discretion, and findings of act.
Findings of fact by an administrative board, agency or official, following a hearing,
are binding upon the courts and will not be disturbed except where the board,
agency or official has gone beyond his statutory authority, exercised
unconstitutional powers or clearly acted arbitrarily and without regard to his duty
or with grave abuse of discretion. And we have repeatedly held that there is grave
abuse of discretion justifying the issuance of the writ of certiorari only when there
is capricious and whimsical exercise of judgment as is equivalent to lack of
jurisdiction. (Abad Santos v. Province of Tarlac, 67 Phil. 480; Tan vs. People, 88
Phil. 609)"
Respondent Ago contends that the motion filed by petitioner Lianga for
reconsideration of the decision of the Office of the President was denied in an
alleged "decision" dated August 15, 1966, allegedly signed by then Assistant
Executive Secretary Jose J. Leido, Jr. that, "however, for some mysterious,
unknown if not anomalous reasons and/or illegal considerations, the "decision"
allegedly dated August 15, 1966(Annex "D") was never released" and instead a
decision was released on August 9, 1968, signed by then Assistant Executive
Secretary Gilberto M. Duavit, which reversed the findings and conclusions of the
Office of the President in its first decision dated June 16, 1966 and signed by then
Assistant Executive Secretary Leido.
It is elementary that a draft of a decision does not operate as judgment on a case
until the same is duly signed and delivered to the clerk for filing and promulgation.
A decision cannot be considered as binding on the parties until its
promulgation. Respondent should be aware of this rule. In still another case
of Ago v. Court of Appeals, (where herein respondent Ago was the petitioner) the
Court held that, "While it is to be presumed that the judgment that was dictated in
open court will be the judgment of the court, the court may still modify said order
as the same is being put into writing. And even if the order or judgment has
already been put into writing and signed, while it has not yet been delivered to the
clerk for filing, it is stin subject to amendment or change by the judge. It is only
when the judgment signed by the judge is actually filed with the clerk of court that
it becomes a valid and binding judgment. Prior thereto, it could still be subject to
amendment and change and may not, therefore, constitute the real judgment of
the court."
Respondent alleges "that in view of the hopelessly conflicting decisions of the
administrative bodies and/or offices of the Philippine government, and the
important questions of law and fact involved therein, as well as the well-grounded
fear and suspicion that some anomalous, illicit and unlawful considerations had
intervened in the concealment of the decision of August 15, 1966 (Annex "D") of
Assistant Executive Secretary Gilberto M. Duavit, a judicial review of such
divergent administrative decisions is necessary in order to determine the correct
boundary line of the licensed areas in question and restore the faith and
confidence of the people in the actuations of our public officials and in our system
of administration of justice."
The mere suspicion of respondent that there were anomalies in the non-release of
the Leido "decision" allegedly denying petitioner's motion for reconsideration and
the substitution thereof by the Duavit decision granting reconsideration does not
justify judicial review. Beliefs, suspicions and conjectures cannot overcome the
presumption of regularity and legality of official actions. It is presumed that an
official of a department performs his official duties regularly. It should be noted,
furthermore, that as hereinabove stated with regard to the case history in the
Office of the President, Ago's motion for reconsideration of the Duavit decision
dated August 9, 1968 was denied in the Order dated October 2, 1968 and signed
by Assistant Executive Secretary Leido himself (who thereby joined in the reversal
of his own first decision dated June 16, 1966 and signed by himself).
The Ordinary Timber License No. 1323-'60[New] which approved the transfer to
respondent Ago of the 4,000 hectares from the forest area originally licensed to
Narciso Lansang, stipulates certain conditions, terms and limitations, among
which were: that the decision of the Director of Forestry as to the exact location of
its licensed areas is final; that the license is subject to whatever decision that may
be rendered on the boundary conflict between the Lianga Bay Logging Co. and
the Ago Timber Corporation; that the terms and conditions of the license are
subject to change at the discretion of the Director of Forestry and the license may
be made to expire at an earlier date. Under Section 1834 of the Revised
Administrative Code, the Director of Forestry, upon granting any license, may
prescribe and insert therein such terms, conditions, and limitations, not
inconsistent with law, as may be deemed by him to be in the public interest. The
license operates as a contract between the government and respondent.
Respondent, therefore, is estopped from questioning the terms and stipulation
thereof.
Clearly, the injunctive writ should not have been issued. The provisions of law
explicitly provide that Courts of First Instance shall have the power to issue writ of
injunction, mandamus, certiorari, prohibition, quo warranto and habeas corpus in
their respective places, if the petition filed relates to the acts or omissions of an
inferior court, or of a corporation, board, officer or person, within their jurisdiction.
The jurisdiction or authority of the Court of First Instance to control or restrain acts
by means of the writ of injunction is limited only to acts which are being committed
within the territorial boundaries of their respective provinces or districts except
where the sole issue is the legality of the decision of the administrative officials.
In the leading case of Palanan Lumber Plywood Co., Inc. v. Arranz which involved
a petition for certiorari and prohibition filed in the Court of First Instance of Isabela
against the same respondent public officials as here and where the administrative
proceedings taken were similar to the case at bar, the Court laid down the rule
that: "We agree with the petitioner that the respondent Court acted without
jurisdiction in issuing a preliminary injunction against the petitioners Executive
Secretary, Secretary of Agriculture and Natural Resources and the Director of
Forestry, who have their official residences in Manila and Quezon City, outside of
the territorial jurisdiction of the respondent Court of First Instance of Isabela. Both
the statutory provisions and the settled jurisdiction of this Court unanimously
affirm that the extraordinary writs issued by the Court of First Instance are limited
to and operative only within their respective provinces and districts."
A different rule applies only when the point in controversy relates solely to a
determination of a question of law whether the decision of the respondent
administrative officials was legally correct or not. We thus declared in Director of
Forestry v. Ruiz. "In Palanan Lumber & Plywood Co., Inc., supra, we reaffirmed
the rule of non-jurisdiction of courts of first instance to issue injunctive writs in
order to control acts outside of their premises or districts. We went further and
said that when the petition filed with the courts of first instance not only questions
the legal correctness of the decision of administrative officials but also seeks to
enjoin the enforcement of the said decision, the court could not validly issue the
writ of injunction when the officials sought to be restrained from enforcing the
decision are not stationed within its territory.1avvphi1
"To recapitulate, insofar as injunctive or prohibitory writs are concerned, the rule
still stands that courts of first instance have the power to issue writs limited to and
operative only within their respective provinces or districts. "
The writ of preliminary injunction issued by respondent court is furthermore void,
since it appears that the forest area described in the injunctive writ includes areas
not licensed to respondent Ago. The forest area referred to and described therein
comprises the whole area originally licensed to Narciso Lansang under the earlier
Ordinary Timber License No. 58452. Only a portion of this area was in fact
transferred to respondent Ago as described in its Ordinary Timber License No.
1323-'60[New].
It is abundantly clear that respondent court has no jurisdiction over the subject
matter of Civil Case No. 1253 of the Court of First Instance of Agusan nor has it
jurisdiction to decide on the common boundary of the licensed areas of petitioner
Lianga and respondent Ago, as determined by respondents public officials against
whom no case of grave abuse of discretion has been made. Absent a cause of
action and jurisdiction, respondent Judge acted with grave abuse of discretion and
excess, if not lack, of jurisdiction in refusing to dismiss the case under review and
in issuing the writ of preliminary injunction enjoining the enforcement of the final
decision dated August 9, 1968 and the order affirming the same dated October 2,
1968 of the Office of the President.
ACCORDINGLY, the petition for certiorari and prohibition is granted. The
restraining order heretofore issued by the Court against enforcement of the
preliminary injunction and related orders issued by respondent judge is the case
below is made permanent and the respondent judge or whoever has taken his
place is hereby ordered to dismiss Civil Case No. 1253.
SO ORDERED.
Narvasa, Cruz, Paras and Gancayco, JJ., concur.
Footnotes
Decision of the Director of Forestry, dated March 20, 1961, p. 108, Rollo.
P. 109, Rollo.
P. 109, Rollo, emphasis supplied.
P. 148, Rollo.
Pp. 149-154, Rollo. Tolentino vs. Catoy, 82 Phil. 300.

Pp. 157-167, Rollo. Quien v. Serina, 17 SCRA 567; Phil. International Surety Co., inc. v. Court
of Tax Appeals, 19 SCRA 617; People v. Pineda, 20 SCRA 748; People
P. 168, Rollo. v. Cortes, 20 SCRA 1228.

Pp. 124-138, Rollo. Section 44(h) of the Judiciary Act of 1948.

Pp. 171-177, Rollo. Section 4, Rule 65, Rules of Court.

Pp. 178-212, Rollo. Director of Forestry v. King, 38 SCRA 559.

Pp. 238-256. Gayacao v. Hon. Executive Secretary, et al., 13 SCRA 763; Zamboanga
General Utilities Inc. v. Secretary of Agriculture and Natural Resources,
20 SCRA 881; Macailing v. Andrada, 31 SCRA 126.
Pp. 332-339, Rollo.

P. 381, Rollo. 22 SCRA 1186.

Gayacao v. Hon. Executive Secretary, et al., 13 SCRA 753; Zamboanga

P. 382, Rollo.
General Utilities Inc. vs. Secretary of Agriculture and Natural Resources,
20 SCRA 881; Macailing, et al., vs. Andrada, et al., 31 SCRA 126.
Sec. 79(c), Rev. Adm. Code.
38 SCRA 559.
Executive Order No. 19, dated April 2, 1966.

Ganitano v. Secretary of Agriculture and Natural Resources, 16 SCRA

534.

Ibid.

R.B. Industrial Development Co. Ltd. vs. Enage, 24 SCRA 365.

Comm. of Customs v. Valencia, 100 Phil. 165. See also Special Events
and Central Shipping Office Workers Union v. San Miguel Corporation,
122 SCRA 557 citing International Hardwood and Veneer Co., of the
Philippines v. Hon. Vicente Leogardo, et al., 117 SCRA 967; Genconsu
Free Workers Union vs. Inciong, 91 SCRA 311; Dy Keh Beng v.
International Labor and Marine Union of the Phil., go SCRA 162.

Abejo vs. De la Cruz, G.R. No. 63558, May 19, 1987.

108 Phil. 905 (1960).

Vda. de Potenciano v. Gruenberg, 4 SCRA 127.

6 SCRA 530 (1962); see also People v. Soria, 22 SCRA 948; Comia v.
Nicolas, 29 SCRA 492.