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EN BANC

[G.R. No. 159940. February 16, 2005]


OFFICE OF THE OMBUDSMAN, petitioner, vs. CIVIL SERVICE COMMISSION,
respondent.
DECISION
CARPIO-MORALES, J.:
Before this Court is a petition for certiorari under Rule 65 of the 1997 Revised Rules
of Court seeking to set aside and nullify Resolution No. 030919 of the Civil Service
Commission (CSC) dated August 28, 2003.
The antecedents of the case are as follows:
By letter[1] dated March 7, 1994 addressed to then Ombudsman Conrado M.
Vasquez, the CSC approved the Qualification Standards for several positions in the
Office of the Ombudsman (petitioner) including that for Graft Investigation Officer
III. The Qualification Standards for said position are:
EDUCATION: Bachelor of Laws
EXPERIENCE: 5 years of experience in the practice of law, counseling,
investigation/ prosecution of cases, hearings of administrative/ criminal cases, legal
research or other related work.
TRAINING: 24 hours of relevant training
ELIGIBILITY: RA 1080 (Bar)
The Career Executive Service Board (CESB) subsequently advised the Ombudsman,
by letter of May 29, 1996,[2] that pursuant to CSC Memorandum Circular No. 21,
s.1994, the position of Graft Investigation Officer III, among other positions in
petitioner therein mentioned, was classified as a Career Executive Service (CES)
position, hence, governed by the rules of the CES pertaining to eligibility,
appointment to CES ranks, and performance evaluation, among other things.
On September 29, 1999, the members of the Constitutional Fiscal Autonomy Group
(CFAG), namely: the Commission on Elections (COMELEC), CSC, Commission on
Audit (COA), Commission on Human Rights (CHR), petitioner and this Court
adopted Joint Resolution No. 62[3] reading:
JOINT RESOLUTION NO. 62
WHEREAS, the independence of the members of the Constitutional Fiscal
Autonomy Group (CFAG) is guaranteed by the Constitution;
WHEREAS, the Constitution has several provisions that guarantee and protect such
independence, among which are Sections 4 and 5 of Article IX, A thereof, which
respectively grant them Fiscal Autonomy and authorize them to appoint their own
officials and employees in accordance with law;
WHEREAS, Section 7(3), Title I, Book V of the Administrative Code of 1987
enumerates exclusively and restrictively the specific positions under the Career
Executive Service, all the holders of which are appointed by the President and
are required to have CES eligibility;
WHEREAS, in case of Home Insurance Guaranty Corporation vs. Civil Service
Commission and Daniel Cruz, G.R. No. 95450, dated 19 March 1993, the Supreme

Court nullified the classification by the CSC of the position of Corporate Vice
President as belonging to the third level of the Career Executive Services;
WHEREAS, the Court declared in the above cited case that said position is not
among those enumerated by law as falling under the third level, nor one of those
identified by the CES Board as equivalent rank to those listed by law, nor was the
incumbent appointed by the President;
WHEREAS, in the case of Sixto Brillantes, Jr. vs. Haydee T. Yorac, G.R. No. 93867,
dated 18 December 1990, the Supreme Court ruled that Article IX-A, Sec. 1 of the
Constitution expressly describes all Constitutional Commissions as Independent.
Although essentially executive in nature, they are not under the control of the
President of the Philippines in the discharge of their respective functions.
WHEREAS, only the Chairmen and Commissioners of the Constitutional
Commissions, the Commission on Human Rights, Justices and Judges, as well as the
Ombudsman and his Deputies, are appointed by the President;
WHEREAS, the Constitutional Commissions, the Supreme Court, the
Commission on Human Rights, and the Office of the Ombudsman are
empowered to appoint officials and employees to positions belonging to first
level up to third level of their respective agencies, and that they are not
presidential appointees;
WHEREAS, Section 22 par. 1, Chapter 5, Subtitle A, Title I, Book V, of the
Administrative Code of 1987, provides in part that [t]he degree of qualifications of
an officer or employee shall be determined by the appointing authority on the basis
of the qualification standard for the particular positions[,] and par. 2 thereof provides
that [t]he establishment, administration and maintenance of qualification standards
shall be the responsibility of the department or agency, with the assistance and
approval of the Civil Service Commission;
NOW, THEREFORE, the CFAG jointly resolves:
1. That all third level positions under each member agency are career positions;
2. That, where appropriate and proper, taking into consideration the organizational
set-up of the agency concerned, the overall screening and selection process for these
positions shall be a collegial undertaking, provided that the appointment paper shall
be signed only by the Head of the member agency;
3. That all career third level positions identified and classified by each of the
member agency are not embraced within the Career Executive Service (CES)
and as such shall not require Career Service Executive Eligibility (CSEE) or
Career Executive Service (CES) Eligibility for purposes of permanent
appointment;
4. That should CFAG member agencies develop their respective eligibility
requirements for the third level positions, the test of fitness shall be jointly
undertaken by the CFAG member agencies in coordination with the CSC;
5. That in case the test of fitness shall be in written form, the CSC shall prepare the
questionnaires and conduct the examinations designed to ascertain the general
aptitude of the examinees while the member agency shall likewise prepare the
questionnaires and conduct in conjunction with the CSC, the examinations to

determine the technical capabilities and expertise of the examinees suited to its
functions;
6. That the resulting eligibility acquired after passing the aforementioned
examination shall appropriate for permanent appointment only to third level
positions in the CFAG member agencies;
7. That the member agencies shall regularly coordinate with the CSC for the
conferment of the desired eligibility in accordance with this Resolution; However
this is without prejudice to those incumbents who wish to take the Career Service
Executive Examination given by the Civil Service Commission or the Management
Aptitude Test Battery given by the Career Executive Service Board. (Underscoring in
the original omitted; emphasis, italics and underscoring supplied)
On July 31, 2002, Melchor Arthur H. Carandang, Paul Elmer M. Clemente and Jose
Tereso U. de Jesus, Jr. were appointed Graft Investigation Officers III of petitioner
by the Ombudsman. The CSC approved the appointments on the condition that for
the appointees to acquire security of tenure, they must obtain CES or Civil Service
Executive (CSE) eligibility which is governed by the CESB.
By January 2, 2003 letter to the CSC, the Ombudsman requested for the change of
status, from temporary to permanent, of the appointments of Carandang, Clemente
and De Jesus effective December 18, 2002. Invoking the Court of Appeals ruling in
Khem N. Inok v. Hon. Corazon Alma de Leon, et al. (CA-G.R. SP No. 49699), as
affirmed by the Supreme Court, the Ombudsman wrote:
xxx
In the Decision of the Court of Appeals dated January 28, 2001 on CA G.R. SP
No. 49699 as affirmed by the Supreme Court with finality on July 2, 2002 in
G.R. No. 148782 entitled Khem N. Inok vs. Civil Service Commission, it stated
in said Decision that the letter and intent of the law is to circumscribe the
Career Executive Service (CES) to CES positions in the Executive Branch of
Government, and that the Judiciary, the Constitutional Commissions, the Office
of the Ombudsman and the Commission on Human Rights are not covered by
the CES governed by the Career Executive Service Board. Said Decision
thereby effectively granted the petition of Mr. Inok for security of tenure as
Director II of the Commission on Audit despite the absence of a CES eligibility.
[4] (Emphasis and italics supplied)
The relevant portions of the cited CA decision read:
Presidential Decree No. 807, otherwise known as the Civil Service Decree of the
Philippines, provides the following levels of position in the career service, viz:
SEC. 7. Classes of Positions in the Career Service.
(a) Classes of positions in the career service appointment to which requires
examinations shall be grouped into three major levels as follows:
(1) The first level shall include clerical, trades, crafts, and custodial service positions
which involve non-professional or subprofessional work in a non-supervisory or
supervisory capacity requiring less than four years of collegiate studies;
(2) The second level shall include professional, technical, and scientific positions
which involve professional; technical, or scientific work in a non-supervisory or

supervisory capacity requiring at least four years of college work up to Division


Chief level; and
(3) The third level shall cover positions in the Career Executive Service.
(b) Except as herein otherwise provided, entrance to the first two levels shall be
through competitive examinations, which shall be open to those inside and outside
the service who meet the minimum qualification requirements. Entrance to a higher
level does not require previous qualification in a lower level. Entrance to the
third level shall be prescribed by the Career Executive Service Board.
(c) Within the same level, no civil service examination shall be required for
promotion to a higher position in one or more related occupational groups. A
candidate for promotion should however, have previously passed the examination for
that level.
The last sentence of Section 7(b) of P.D. No. 807 is similar to the provision of P.D.
No. 1, Article IV, par. IV, par. 5(a), to wit:
(a) Membership. A person who meets such managerial experience and other
requirements and passes such examinations as may be prescribed by the Board shall
be included in the register of career service eligibles and, upon appointment to an
appropriate class in the Career Executive Service, become an active member in the
Service. In exceptional cases, the Board may give unassembled examinations for
eligibility. The area of recruitment shall be government-wide, with provisions to
allow qualified or outstanding men from outside the government to enter the service.
Thus, it could be gleaned from P.D. No. 1 of the Career Executive Service (CES),
which has been [d]rafted into Executive Order No. 292, that the letter and intent of
the law is to circumscribe the Career Executive Service to CES positions in the
Executive Branch of government. Verily, consistent with the principle of the ejusdem
generis in legal hermeneutics, the phrase other officers of equivalent rank could
encompass only such persons occupying positions in the Executive Department. In
the contemporaneous case of the The Secretary of Justice Serafin R. Cuevas, et. al.
vs. Atty. Josefina G. Bacal, the Supreme Court lent credence to this postulate, viz:
Security of tenure in the career executive service is acquired with respect to rank and
not to position. The guarantee of security of tenure to members of the CES does
not extend to the particular positions to which they may be appointed a concept
which is applicable only to frst and second level employees in the civil service but to
the rank to which they are appointed by the President. x x x
Prescinding from the foregoing disquisition, We are loathe to stamp our imprimatur
to the Commissions stance that the positions of Director III, including that of the
COA, belong to the third level. Hence, appointees thereto should possess the x x x
Career Executive Service (CES) Eligibility in accordance with the Qualification
Standard of the said position.
Ineluctably, the judiciary, the Constitutional Commissions, the Office of the
Ombudsman, and the Commission on Human Rights are not covered by the CES
governed by the CESB. The power of these constitutional offices to appoint their
own officers and employees is mainly intended to safeguard their independence,

which is the same power of appointment of all officials and employees of the
judiciary granted to the Supreme Court. As commented by a noted constitutionalist:
The authority of the Supreme Court to appoint its own officials and employees is
another measure intended to safeguard the independence of the judiciary. However,
the Courts appointing authority must be exercised in accordance with the Civil
Service Law.
Irrefragrably, inherent in the power to appoint is the power to administratively
supervise the officials and employees in the constitutional offices in the same manner
that the express power to appoint carries with it the implied power to remove the
personnel appointed in said offices. x x x
xxx
Parenthetically, the power to administratively supervise is designed to strengthen the
independence of the constitutional offices. A respected authority on political law
underscored the multifarious factors that are integral to the independence of the
constitutional offices, scilicet:
There are several factors that preserve the independence of the three Commissions:
xxx
(3) Their appointment must be in a permanent capacity.
(4) The Commissions enjoy their own fiscal autonomy.
The independence of these constitutional offices serves to exempt their respective
officials and employees from the coverage of the CES under the administrative
authority of the CESB. to be sure, they are embraced by the civil service system.
However, the administrative functions belong to the constitutional offices, instead of
the CESB in the same manner that the Supreme Court administers the judiciarys civil
service.
x x x[5] (Italics and emphasis in the original;
underscoring partly in the original and partly supplied;
citations omitted)
It appears that Carandang and Clemente were in the meantime conferred with CSE
Eligibility pursuant to CSC Resolution No. 03-0665 dated June 6, 2003.[6]
Petitioner subsequently reclassified several positions by Resolution No. 02-03 dated
August 18, 2003 including Graft Investigation Officer III which was reclassified to
Graft Investigation and Prosecution Officer III. The Ombudsman thereupon
requested the approval of the proposed Qualification Standards for the reclassified
positions. With respect to the reclassified Graft Investigation and Prosecution Officer
III position, the Qualification Standards were the same as those for Graft
Investigation Officer III.
Subsequently, the CSC, by the challenged Resolution of August 28, 2003, changed
the status of Carandangs and Clementes appointments to permanent effective June 6,
2003, but not with respect to De Jesus on the ground that he has not met the
eligibility requirements. The pertinent portion of the questioned Resolution reads:
Relevant to the matter are Sections 4 and 6, Rule III and Rule VI, respectively, of the
Omnibus Rules on Appointments and Other Personnel Action, which state:
SEC. 4. Nature of Appointment. The nature of appointment shall be as follows:

xxx
i. Change of status:
1. temporary to permanent the appointment issued to a temporary employee when he
acquires the appropriate eligibility or becomes fully qualified for the position to
which he is appointed.
xxx
SEC. 6. In cases where the appointee fully qualifies for the position to which he is
temporarily appointed, the appointing authority shall no longer issue an appointment
for change of status from temporary to permanent. Upon the appointees presentation
of the required document/s, such change may be effected as a footnote on the
temporary appointment issued, copy furnished the Commission.
It is explicitly provided therein that the change of status from temporary to
permanent can be effected only once the appointee becomes fully qualified to
the position to which he is appointed.
xxx
The pronouncement of the Court of Appeals in the Inok case cannot be made the
basis for changing the employment status of De Jesus. Let it be stressed that nowhere
in the aforesaid decision states that the Office of the Ombudsman or the other
constitutional agencies mentioned therein are exempt or are not covered by the Civil
Service Law and Rules. On the contrary, the same decision declares that these bodies
are covered by the civil service system. Basic is the rule that all appointments in the
government service, particularly the career service, must be in accordance with the
qualification requirements as laid down under existing civil service rules and
regulations. Such policy is in line with the Commissions mandate to professionalize
the civil service. The requirements spelled out in the Qualification Standards
(QS) Manual are designed to determine the fitness of the appointee in a certain
position. These requirements are indispensable in order to satisfy the
Constitutional mandate that appointment in the civil service shall be made
according to merit and fitness.
While it is true that constitutional agencies such as the Office of the Ombudsman has
the authority to appoint its officials in accordance with law, such law does not
necessarily imply that their appointment will not be subject to Civil Service Law and
Rules; otherwise, these independent bodies will arrogate upon themselves a power
that properly belongs to the Civil Service Commission. Had the intention of the
framers of the Constitution been to isolate and grant full independence to
Constitutional Commissions in the matter of appointments, it would have been so
provided. But that is not the case. the Philippine Constitution provides: The
Constitutional Commissions shall appoint their officials and employees in
accordance with law (Article IX-A, Section 4). Specifically, Section 6, Article XI of
the Constitution states that The officials, shall be appointed by the Ombudsman
according to the Civil Service Law. And since all matters pertaining to appointments
are within the realm of expertise to the CSC, all laws, rules and regulations it issues
on appointments must be complied with.

The Constitution speaks of only one civil service, to encompass the first, second, and
third levels. It is subject to the same set of laws, rules and regulations in the manner
of observing and ensuring that the merit and fitness principle, unless otherwise
exempted therefrom by the Constitution or law, is the guiding factor in issuing
appointments. Hence, until and unless there is a law or rule exempting one category
of public officials from the test in determining merit and fitness, all levels in the
government are deemed subject to it. Simply put, the third level eligibility
requirement for third level officials in all agencies is mandatory.
Further, let it be clarified that the ruling enunciated in Inok case was with regard to
the authority of the Career Executive Service Board to prescribe and to administer
the Career Executive Service Eligibility and it did not specifically nor particularly
take away the functions of the Civil Service Commission. This is evident from the
aforequoted decision in the Inok case, to wit:
The independence of these constitutional offices serves to exempt their respective
officials and employees from the coverage of the CES under the administrative
authority of the CESB. To be sure, they are embraced by the civil service system.
However, the administrative functions belong to the constitutional offices, instead of
the CESB in the manner that the Supreme Court administers the judiciarys civil
service.
Pursuant to the QS Manual, a Graft Investigation Officer III position is a career
service position requiring a Career Service Eligibility or Career Service
Executive Eligibility. Considering that De Jesus has not met the eligibility
requirement, the change of status of his appointment from temporary to
permanent cannot be effected. As held in Achacoso vs. Macaraig, 195 SCRA 235:
It is settled that a permanent appointment can be issued only to a person who meets
all the requirements for the position to which he is appointed, including the
appropriate eligibility prescribed. Achacoso did not. At best, therefore, his
appointment could be regarded only as temporary.
x x x (Underscoring partly in the original and partly supplied; emphasis supplied)
Hence, the present petition anchored on the following ground:
THE GENERAL POWER OF RESPONDENT CIVIL SERVICE COMMISSION
(CSC) TO ADMINISTER THE CIVIL SERVICE CANNOT
CONSTITUTIONALLY AND VALIDLY CURTAIL THE SPECIFIC
DISCRETIONARY POWER OF APPOINTMENT, INCLUDING THE GRANT OF
SECURITY OF TENURE, BY THE OMBUDSMAN AS AN INDEPENDENT
CONSTITUTIONAL BODY IN FAVOR OF THE LATTERS OWN OFFICIALS,
AND ANY SUCH CURTAILMENT BY THE RESPONDENT CSC, AS IN ITS
IMPUGNED RESOLUTION NO. 030919 DATED 26 AUGUST 2003, IS
CONSTITUTIONALLY AND LEGALLY INFIRM.
Petitioner contends that the CSC misreads the ratio of the appellate court decision in
Inok. It contends that the Ombudsman, as an appointing authority, is specifically
tasked by the Constitution to choose his own qualified personnel, which includes the
lesser power of granting security of tenure to his appointees once the basic
qualification requirements are satisfied.[7]

Petitioner likewise contends that its constitutional discretion as an independent


appointing authority cannot be curtailed by the CSC which has no authority to
review the appointments made by other offices except only to ascertain if the
appointee possesses the required qualifications.[8]
Petitioner further contends that the CES Eligibility, as administered by the
respondent CESB, cannot be validly made a requisite for the attainment of security
of tenure on qualified career officials of petitioner who are not legally part of the
CES.
Finally, petitioner argues that its officials which are appointed by the Ombudsman
are technically classified as belonging to the Closed Career Service, the positions
being unique and highly technical as they involve investigatorial, quasi-judicial and
prosecutorial functions, in much the same way as judges are involved in judicial
functions. Hence, petitioner concludes, appointment to such positions is likewise
characterized by security of tenure.
During the pendency of the case before this Court, the CSC, by Resolution[9] No.
040738 dated July 6, 2004, approved the proposed Qualification Standards for Graft
Investigation and Prosecution Officer I, II and III. As proposed, the following
Qualification Standards for Graft Investigation and Prosecution Officer III were
approved:
Education : Bachelor of Laws
Experience : Five (5) years of experience in the practice of law, counseling,
investigation/ prosecution of cases, hearings of administrative/criminal cases, legal
research or other related works
Training : 24 hours of relevant training
Eligibility : RA 1080 (BAR)
The petition is impressed with merit.
That the positions subject of the present case are unique and highly technical in
nature, as are those of the Judiciary, is recognized by the constitutional offices under
the earlier quoted Joint Resolution No. 62 of the CFAG of which CSC is a member.
[10]
Inok cannot be invoked as precedent in arriving at the question raised in this petition.
This Court dismissed the petition of the CSC in the Inok case on a technicality
therein petitioner CSCs failure to file a reply within the required period and not on
the merits.
Book V, Title I, Subtitle A of the Administrative Code of 1987 provides:
SECTION 7. Career Service. The Career Service shall be characterized by (1)
entrance based on merit and fitness to be determined as far as practicable by
competitive examination, or based on highly technical qualifications; (2) opportunity
for advancement to higher career positions; and (3) security of tenure.
The Career Service shall include:
1) Open Career positions for appointment to which prior qualification in an
appropriate examination is required;
(2) Closed Career positions which are scientific, or highly technical in nature; these
include the faculty and academic staff of state colleges and universities, and

scientific and technical positions in scientific or research institutions which shall


establish and maintain their own merit systems;
(3) Positions in the Career Executive Service; namely, Undersecretary, Assistant
Secretary, Bureau Director, Assistant Bureau Director, Regional Director, Assistant
Regional Director, Chief of Department Service and other officers of equivalent
rank as may be identified by the Career Executive Service Board, all of whom
are appointed by the President;
x x x (Emphasis and underscoring supplied)
From the above-quoted provision of the Administrative Code, persons occupying
positions in the CES are presidential appointees. A person occupying the position of
Graft Investigation Officer III is not, however, appointed by the President but by the
Ombudsman as provided in Article IX of the Constitution, to wit:
SECTION 6. THE OFFICIALS AND EMPLOYEES OF THE OMBUDSMAN,
OTHER THAN THE DEPUTIES, SHALL BE APPOINTED BY THE
OMBUDSMAN ACCORDING TO THE CIVIL SERVICE LAW.
To classify the position of Graft Investigation Officer III as belonging to the CES and
require an appointee thereto to acquire CES or CSE eligibility before acquiring
security of tenure would be absurd as it would result either in 1) vesting the
appointing power for said position in the President, in violation of the Constitution;
or 2) including in the CES a position not occupied by a presidential appointee,
contrary to the Administrative Code.
It bears emphasis that that under P.D. No 807, Sec. 9(h) which authorizes the CSC to
approve appointments to positions in the civil service, except those specified therein,
its authority is limited only to [determine] whether or not the appointees possess the
legal qualifications and the appropriate eligibility, nothing else.[11]
It is not disputed that, except for his lack of CES or CSE eligibility, De Jesus
possesses the basic qualifications of a Graft Investigation Officer III, as provided in
the earlier quoted Qualification Standards. Such being the case, the CSC has the
ministerial duty to grant the request of the Ombudsman that appointment be made
EN BANC
CIVIL SERVICE COMMISSION,
Petitioner,

G.R. No. 158791


Present:

- versus -

DEPARTMENT OF BUDGET AND


MANAGEMENT,
Respondent.

DAVIDE, JR., C.J.,


PUNO,
PANGANIBAN,
QUISUMBING,
YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,

permanent effective December 18, 2002. To refuse to heed the request is a clear
encroachment on the discretion vested solely on the Ombudsman as appointing
authority.[12] It goes without saying that the status of the appointments of Carandang
and Clemente, who were conferred CSE eligibility pursuant to CSC Resolution No.
03-0665 dated June 6, 2003, should be changed to permanent effective December 18,
2002 too.
In a Supplemental Memorandum[13] received by this Court on January 5, 2005, the
CSC alleged that, inter alia:
. . . the reclassified G[raft] I[nvestigation and] P[rosecution] O[fficer] III position is
the same position which is the subject of the herein case. Suffice it to state that the
eligibility requirement under the new QS is no longer third level eligibility but RA
1080 (BAR) instead. However, notwithstanding the said approval of the new QS for
GIPO III, CSC prays that the issues raised by the Office of Ombudsman relative to
the authority of the CSC to administer the Civil Service Executive Examination for
third level positions and to prescribe third level eligibility to third level positions in
the Office of the Ombudsman be resolved.
As the Court takes note of the information of the CSC in its Supplemental
Memorandum, it holds that third level eligibility is not required for third level
officials of petitioner appointed by the Ombudsman in light of the provisions of the
Constitution vis a vis the Administrative Code of 1987 as discussed above.
WHEREFORE, the petition is hereby GRANTED. Resolution No. 030919 of the
Civil Service Commission dated August 28, 2003 is hereby SET ASIDE. The
appointment of Jose Tereso U. de Jesus, Jr., as well as those of Melchor Arthur H.
Carandang, Paul Elmer M. Clemente, is hereby ordered made permanent effective
December 18, 2002.
SO ORDERED.
Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-Santiago, SandovalGutierrez, Carpio, Austria-Martinez, Corona, Callejo, Sr., Azcuna, Tinga, ChicoNazario and Garcia, JJ., concur.
CARPIO MORALES,
CALLEJO, SR.,
AZCUNA,
TINGA,
CHICO-NAZARIO, and
GARCIA, JJ.
Promulgated:
July 22, 2005
_______________________
x - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
DECISION

CARPIO MORALES, J.:


The Civil Service Commission (petitioner) via the present petition for mandamus
seeks to compel the Department of Budget and Management (respondent) to release
the balance of its budget for fiscal year 2002. At the same time, it seeks a
determination by this Court of the extent of the constitutional concept of fiscal
autonomy.
By petitioners claim, the amount of P215,270,000.00 was appropriated for its Central
Office by the General Appropriations Act (GAA) of 2002, while the total allocations
for the same Office, if all sources of funds are considered, amount to
P285,660,790.44.[1] It complains, however, that the total fund releases by
respondent to its Central Office during the fiscal year 2002 was only
P279,853,398.14, thereby leaving an unreleased balance of P5,807,392.30.
To petitioner, this balance was intentionally withheld by respondent on the basis of
its no report, no release policy whereby allocations for agencies are withheld pending
their submission of the documents mentioned in Sections 3.8 to 3.10 and Section 7.0
of National Budget Circular No. 478 on Guidelines on the Release of the FY 2002
Funds,[2] which documents are:
1.
Annual Cash Program (ACP)
2.
Requests for the Release of Special Allotment Release Order (SARO) and
Notice of Cash Allocation (NCA)
3.
Summary List of Checks Issued and Cancelled
4.
Statement of Allotment, Obligations and Balances
5.
Monthly Statement of Charges to Accounts Payable
6.
Quarterly Report of Actual Income
7.
Quarterly Financial Report of Operations
8.
Quarterly Physical Report of Operations
9.
FY 2001 Preliminary and Final Trial Balance
10.
Statement of Accounts Payable
Petitioner contends that the application of the no report, no release policy upon
independent constitutional bodies of which it is one is a violation of the principle of
fiscal autonomy and, therefore, unconstitutional.
Respondent, at the outset, opposes the petition on procedural grounds. It contends
that first, petitioner did not exhaust administrative remedies as it could have sought
clarification from respondents Secretary regarding the extent of fiscal autonomy
before resorting to this Court. Second, even assuming that administrative remedies
were exhausted, there are no exceptional and compelling reasons to justify the direct
filing of the petition with this Court instead of the trial court, thus violating the
hierarchy of courts.

On the merits, respondent, glossing over the issue raised by petitioner on the
constitutionality of enforcing the no report, no release policy, denies having strictly
enforced the policy upon offices vested with fiscal autonomy, it claiming that it has
applied by extension to these offices the Resolution of this Court in A.M. No. 92-9029-SC (Constitutional Mandate on the Judiciarys Fiscal Autonomy) issued on June
3, 1993, [3] particularly one of the guiding principles established therein governing
the budget of the Judiciary, to wit:
5. The Supreme Court may submit to the Department of Budget and Management
reports of operation and income, current plantilla of personnel, work and financial
plans and similar reports only for recording purposes. The submission thereof
concerning funds previously released shall not be a condition precedent for
subsequent fund releases. (Emphasis and underscoring supplied)
Respondent proffers at any rate that the delay in releasing the balance of petitioners
budget was not on account of any failure on petitioners part to submit the required
reports; rather, it was due to a shortfall in revenues.[4]
The rule on exhaustion of administrative remedies invoked by respondent applies
only where there is an express legal provision requiring such administrative step as a
condition precedent to taking action in court.[5] As petitioner is not mandated by any
law to seek clarification from the Secretary of Budget and Management prior to
filing the present action, its failure to do so does not call for the application of the
rule.
As for the rule on hierarchy of courts, it is not absolute. A direct invocation of this
Court's original jurisdiction may be allowed where there are special and important
reasons therefor, clearly and specifically set out in the petition.[6] Petitioner justifies
its direct filing of the petition with this Court as the matter involves the concept of
fiscal autonomy granted to [it] as well as other constitutional bodies, a legal question
not heretofore determined and which only the Honorable Supreme Court can decide
with authority and finality.[7] To this Court, such justification suffices for allowing
the petition.
Now on the substantive issues.
That the no report, no release policy may not be validly enforced against offices
vested with fiscal autonomy is not disputed. Indeed, such policy cannot be enforced
against offices possessing fiscal autonomy without violating Article IX (A), Section
5 of the Constitution which provides:
Sec. 5. The Commission shall enjoy fiscal autonomy. Their approved appropriations
shall be automatically and regularly released.

In Province of Batangas v. Romulo,[8] this Court, in construing the phrase automatic


release in Section 6, Article X of the Constitution reading:
Section 6. Local government units shall have a just share, as determined by law, in
the national taxes which shall be automatically released to them,

Furthermore, the Constitution grants the enjoyment of fiscal autonomy only to the
Judiciary, the Constitutional Commissions of which petitioner is one, and the
Ombudsman. To hold that petitioner may be subjected to withholding or reduction of
funds in the event of a revenue shortfall would, to that extent, place petitioner and
the other entities vested with fiscal autonomy on equal footing with all others which
are not granted the same autonomy, thereby reducing to naught the distinction
established by the Constitution.

held:
Websters Third New International Dictionary defines automatic as involuntary either
wholly or to a major extent so that any activity of the will is largely negligible; of a
reflex nature; without volition; mechanical; like or suggestive of an automaton.
Further, the word automatically is defined as in an automatic manner: without
thought or conscious intention. Being automatic, thus, connotes something
mechanical, spontaneous and perfunctory. As such the LGUs are not required to
perform any act to receive the just share accruing to them from the national coffers.
x x x (Emphasis and underscoring supplied)[9]
By parity of construction, automatic release of approved annual appropriations to
petitioner, a constitutional commission which is vested with fiscal autonomy, should
thus be construed to mean that no condition to fund releases to it may be imposed.
This conclusion is consistent with the above-cited June 3, 1993 Resolution of this
Court which effectively prohibited the enforcement of a no report, no release policy
against the Judiciary which has also been granted fiscal autonomy by the
Constitution.[10]
Respecting respondents justification for the withholding of funds from petitioner as
due to a shortfall in revenues, the same does not lie. In the first place, the alleged
shortfall is totally unsubstantiated. In the second place, even assuming that there was
indeed such a shortfall, that does not justify non-compliance with the mandate of
above-quoted Article IX (A), Section 5 of the Constitution.
Asturias Sugar Central, Inc. v. Commissioner of Customs teaches that [a]n
interpretation should, if possible, be avoided under which a statute or provision being
construed is defeated, or as otherwise expressed, nullified, destroyed, emasculated,
repealed, explained away, or rendered insignificant, meaningless, inoperative, or
nugatory.[11]
If respondents theory were adopted, then the constitutional mandate to automatically
and regularly release approved appropriations would be suspended every year, or
even every month[12] that there is a shortfall in revenues, thereby emasculating to a
significant degree, if not rendering insignificant altogether, such mandate.

The agencies which the Constitution has vested with fiscal autonomy should thus be
given priority in the release of their approved appropriations over all other agencies
not similarly vested when there is a revenue shortfall.
Significantly, the Year 2002 GAA itself distinguished between two types of public
institutions in the matter of fund releases. With respect to government agencies in
general, the pertinent General Provisions of the GAA read as follows:
Sec. 62. Prohibition Against Impoundment of Appropriations. No appropriations
authorized in this Act shall be impounded through deduction or retention, unless in
accordance with the guidelines for the imposition and release of reserves and
the rules and regulations for deduction, retention or deferral of releases shall
have been issued by the DBM in coordination with the House Committee on
Appropriations and the Senate Committee on Finance. Accordingly, all the funds
appropriated for the purposes, programs, projects and activities authorized in this
Act, except those covered by Special Provision No. 1 of the Unprogrammed Fund
shall be regularly and automatically released in accordance with the established
allotment period and system by the DBM without any deduction, retention or
imposition of reserves. (Emphasis and underscoring supplied)
Sec. 63. Unmanageable National Government Budget Deficit. Retention or
reduction of appropriations authorized in this Act shall be effected only in cases
where there is unmanageable national government budget deficit.
Unmanageable national government budget deficit as used in this Section shall be
construed to mean that the actual national government budget deficit has exceeded
the quarterly budget deficit targets consistent with the full-year target deficit of
P130.0 billion as indicated in the FY 2002 Budget of Expenditures and Sources of
Financing submitted by the President to Congress pursuant to Section 22, Article VII
of the Constitution or there are clear economic indications of an impending
occurrence of such condition, as determined by the Development Budget
Coordinating Committee and approved by the President. (Emphasis and
underscoring supplied)

In contrast, the immediately succeeding provision of the Year 2002 GAA, which
specifically applied to offices vested with fiscal autonomy, stated:
Sec. 64. Appropriations of Agencies Vested with Fiscal Autonomy. Any provision
of law to the contrary notwithstanding, the appropriations authorized in this Act
for the Judiciary, Congress of the Philippines, the Commission on Human Rights, the
Office of the Ombudsman, the Civil Service Commission, the Commission on
Audit and the Commission on Elections shall be automatically and regularly
released. (Emphasis and underscoring supplied)
Clearly, while the retention or reduction of appropriations for an office is generally
allowed when there is an unmanageable budget deficit, the Year 2002 GAA, in
conformity with the Constitution, excepted from such rule the appropriations for
entities vested with fiscal autonomy. Thus, even assuming that there was a revenue
shortfall as respondent claimed, it could not withhold full release of petitioners funds
without violating not only the Constitution but also Section 64 of the General
Provisions of the Year 2002 GAA.
This Court is not unaware that its above-cited June 3, 1993 Resolution also states as
a guiding principle on the Constitutional Mandate on the Judiciarys Fiscal Autonomy
that:
4. After approval by Congress, the appropriations for the Judiciary shall be
automatically and regularly released subject to availability of funds. (Underscoring
supplied)
This phrase subject to availability of funds does not, however, contradict the present
ruling that the funds of entities vested with fiscal autonomy should be automatically
and regularly released, a shortfall in revenues notwithstanding. What is contemplated
in the said quoted phrase is a situation where total revenue collections are so low that
they are not sufficient to cover the total appropriations for all entities vested with
fiscal autonomy. In such event, it would be practically impossible to fully release
the Judiciarys appropriations or any of the entities also vested with fiscal autonomy
for that matter, without violating the right of such other entities to an automatic
release of their own appropriations. It is under that situation that a relaxation of the
constitutional mandate to automatically and regularly release appropriations is
allowed.
Considering that the budget for agencies enjoying fiscal autonomy is only a small
portion of the total national budget, only in the most extreme circumstances will the
total revenue collections fall short of the requirements of such agencies. To illustrate,
in the Year 2002 GAA the budget for agencies vested with fiscal autonomy amounted

only to P14,548,620,000.00, which is 2.53% of the total appropriations in the amount


of P575,123,728,000.00.[13] In Year 2003 GAA, which was re-enacted in 2004, the
budget for the same agencies was P13,807,932,000.00, which is 2.27% of the total
appropriations amounting to P609,614,730,000.00.[14] And in the Year 2005, the
budget for the same agencies was only P13,601,124,000.00, which is 2.28% of the
total appropriations amounting to P597,663,400,000.00.[15]
Finally, petitioners claim that its budget may not be reduced by Congress lower than
that of the previous fiscal year, as is the case of the Judiciary, must be rejected.
For with respect to the Judiciary, Art. VIII, Section 3 of the Constitution explicitly
provides:
Section 3. The Judiciary shall enjoy fiscal autonomy. Appropriations for the
Judiciary may not be reduced by the legislature below the amount appropriated
for the previous year and, after approval, shall be automatically and regularly
released.[16] (Emphasis and underscoring supplied)
On the other hand, in the parallel provision granting fiscal autonomy to
Constitutional Commissions, a similar proscription against the reduction of
appropriations below the amount for the previous year is clearly absent. Article IX
(A), Section 5 merely states:
Section 5. The Commission shall enjoy fiscal autonomy. Their approved annual
appropriations shall be automatically and regularly released.
The plain implication of the omission of the provision proscribing such reduction of
appropriations below that for the previous year is that Congress is not prohibited
from reducing the appropriations of Constitutional Commissions below the amount
appropriated for them for the previous year.
WHEREFORE, the petition is, in light of all the foregoing discussions,
GRANTED. Respondents act of withholding the subject funds from petitioner due
to revenue shortfall is hereby declared UNCONSTITUTIONAL.
Accordingly, respondent is directed to release to petitioner the amount of Five
Million Eight Hundred Seven Thousand, Three hundred Ninety Two Pesos and
Thirty Centavos (P5,807,392.30) representing the unreleased balance of petitioners
appropriation for its Central Office by the General Appropriations Act for FY 2002.
SO ORDERED.

CONCHITA CARPIO MORALES


Associate Justice
SUPREME COURT
Manila
EN BANC
G.R. No. 158791
February 10, 2006
CIVIL SERVICE COMMISSION, Petitioner,
vs.
DEPARTMENT OF BUDGET AND MANAGEMENT, Respondent.
RESOLUTION
CARPIO MORALES, J.:
Before this Court is the Motion for Reconsideration of respondent Department of
Budget and Management (DBM) praying that this Court reconsider its Decision
dated July 22, 2005 (the Decision) granting the subject petition.
The DBM assails this Courts interpretation of Article IX (A) Section 5 of the
Constitution, Sections 62, 63, and 64 of the FY 2002 General Appropriations Act
(R.A. No. 9162), and the Resolution of this Court in A.M. No. 92-9-029-SC
(Constitutional Mandate on the Judiciarys Fiscal Autonomy) dated June 3, 1993.
The DBM posits that this Courts ruling that fiscal autonomy means preference in
terms of cash allocation is not supported by the deliberations of the 1986
Constitutional Commission, particularly the discussions on the draft article on the
Judiciary where the concept of fiscal autonomy was, by its claim, introduced.
The DBM cites the comments of then Commissioner Blas Ople expressing concern
over "the propensity throughout this Article in its various provisions to accord the
Supreme Court, the lower courts and the judicial system as a whole, a whole plethora
of privileges and immunities that are denied the rest of the government of the
Republic of the Philippines."1
A close reading of Commissioner Oples comments shows, however, that he was not
questioning nor seeking to qualify the concepts of "fiscal autonomy" and "automatic
release" as provided for in what is now Article VIII Section 3 of the Constitution.2
What was then under consideration was the original draft article on the Judiciary
which, with regard to appropriations, provided as follows:
Section 15. An amount equivalent to not less than two percent of the national budget
shall be automatically appropriated and regularly released for the judiciary.
(Underscoring supplied)
What the original draft thus provided for was automatic appropriation, which is not
the same as automatic release of appropriations. The power to appropriate belongs to
Congress, while the responsibility of releasing appropriations belongs to the DBM.
Commissioner Ople objected to automatic appropriation, it bears emphasis, not to
automatic release of appropriations.
It was Commissioner Christian Monsod who proposed the substitute provision that is
now Article VIII Section 3 providing for "fiscal autonomy" and for automatic and
regular release of appropriations.

In support of its position, the DBM also cites Commissioner Monsods explanation
that "[t]he whole purpose of that provision is to protect the independence of the
judiciary while at the same time not giving the judiciary what we call a position of
privilege by an automatic percentage." Again, what Commissioner Monsod objected
to was automatic appropriation for the judiciary, not automatic release of
appropriations once approved. The following statement of Commissioner Monsod,
read in its context, does not in any way support the position taken by the DBM.
The Commissioner will recall that when the provision giving fiscal autonomy to the
judiciary was presented to the body, we were the ones who denied to it the
percentage of the budget because, precisely, we wanted the judiciary to go through
the process of budget-making to justify its budget and to go through the legislature
for that justification. But we also said that after having gone through this process,
it should have fiscal autonomy so that there will be an automatic and regular
release of such funds. The whole purpose of that provision is to protect the
independence of the judiciary while at the same time not giving the judiciary what
we call a position of privilege by an automatic percentage.3 (Emphasis and
underscoring supplied)
The DBM further claims that the constitutional mandate to automatically and
regularly release funds does not preclude the implementation of a cash payment
schedule for all agencies, including those belonging to the constitutional fiscal
autonomous group (CFAG). It explains the meaning of "cash payment schedule" in
the context of the budgetary process, from the enactment of the general
appropriations law to the release of appropriations, thus.
After the General Appropriations Act (GAA) is signed into law, this Department, in
coordination with the agency concerned, prepares the financial plan for the year in
accordance with its appropriations under the GAA. The result of this exercise is
embodied in the Agency Budget Matrix or ABM which reflects the individual
obligation authority ceilings of the agency, called the allotment. An allotment allows
the agency to enter into a contract or otherwise obligate funds although cash has not
yet been received by said agency. Simply put, allotments serve as a guarantee that
the national government will look for cash to support the agencys obligations.
Therefore, the closer the allotment is to the amount of its appropriation, the better.
The approved allotment of an ordinary agency does not cover its full appropriations,
while those for entities vested with fiscal autonomy always cover the full amount of
its appropriations. For instance, allotments for Personal Service of an ordinary
agency only cover those for filled positions. In contrast, the Personal Service
allotments of agencies enjoying fiscal autonomy are comprehensively released,
including those for positions that are admittedly vacant. At the end of the year,
whatever is unspent for Personal Services, particularly for unfilled positions,
translates to savings, which may be used to augment other items of appropriations.

As emphasized, the ABM of an ordinary agency is disaggregated into those Needing


Clearance and Not Needing Clearance. Pursuant to Budget Execution Guidelines no.
2000-12 dated August 29, 2000 x x x, the full allotment of entities belonging to the
CFAG is placed under the Not Needing Clearance column.
Finally, items under the Not Needing Column of an ordinary agency is further
disaggregated to "this release" which represents the initial allotment authorized under
the ABM, and "for later release" which represents the amount to be released after the
conduct of the agency performance review. In contrast, the total appropriation and
allotment of entities belonging to the CFAG are all placed under "this release" since
no agency performance review is conducted by the DBM on these entities.
xxxx
Thus, in order to ensure that the budgets of agencies vested with fiscal autonomy are
released in full, the DBM in a ministerial capacity, ensures that the allotments of
agencies belonging to the CFAG (i) cover the full amount of their annual
appropriations, and (ii) are not subject to any condition. In other words, budgets of
fiscal autonomous agencies occupy the highest category in terms of allotment.
xxxx
After the ABMs are issued, the Notices of Cash Allocations (NCAs) are issued
every month to support approved allotments with cash.
Ideally, the NCA should cover in full the monthly allotment of the agency. The
reality, however, is that every national budget is based on revenue projections,
and that there is an ever present risk that these revenue targets are not met in
full during the course of the budget year. Last FYs 2001 and 2002, for instance,
revenue shortfall was at 7.16% and 9.16%, respectively, as shown below under Table
2.
xxxx
Further, not all revenue collections are received at the start of the budget year. The
cash flow of the national government, like most other public institutions, has its
highs and lows depending on the tax calendar. Thus, not all of the projected revenues
are available for spending at the start of the budget year.
It thus becomes imperative for the Executive Department, through the DBM, to
manage the release of funds through implementation of cash payment
schedules. For instance, if collections for a given month meet the monthly revenue
target, then the NCA for that month shall cover 100% of the allotment. If, however,
collections do not meet the monthly revenue target, then the NCA to be released may
not cover 100% of the allotment. Add a few more variables, such as amount of
deficit and total disbursement of agencies, then one gets a cash payment schedule
that varies on a monthly basis.4 (Emphasis and underscoring supplied)
The DBM goes on to emphasize that it has no discretion on how much cash enters
petitioners coffers, as cash payment schedules are "dictated by the amount of
revenue collection, borrowings, deficit ceilings and total disbursement program of
the national government"5 ; and if the cash payment schedule prescribes that the total
cash to be released for a given month is 85% of allotment, then a Notice of Cash
Allocation amounting to 85% of each agencys allotment is released for all agencies.

It thus contends that this equality in treatment does not violate the fiscal autonomy of
the agencies belonging to the CFAG, for "since approved allotments of agencies
belonging to the CFAG are higher than ordinary agencies, they automatically get
higher cash allocations."6
The DBMs protestation that it has no discretion on the amount of funds released to
agencies with fiscal autonomy fails. The Court finds that the DBM, in fact, exercised
discretion denied it by the constitutional mandate to automatically release such
funds. Understandably, a shortfall in revenue in a given year would constrain the
DBM not to release the total amount appropriated by the GAA for the government as
a whole during that year. However, the DBM is certainly not compelled by such
circumstance to proportionately reduce the funds appropriated for each and every
agency. Given a revenue shortfall, it is still very possible for the DBM to release the
full amount appropriated for the agencies with fiscal autonomy, especially since, as
noted in the Decision, the total appropriation for such agencies in recent years does
not even reach 3% of the national budget.7 That the full amount is, in fact, not
fully released during a given fiscal year is plainly due to a policy decision of the
DBM. Such a decision, whether it goes by the label of "cash payment schedule" or
any other term, cannot be reconciled with the constitutional mandate that the release
to these agencies should be automatic.
Respecting this Courts observation that Sections 62, 63 and 64 of the General
Provisions of the FY2002 GAA reflect the legislative intent to except entities with
fiscal autonomy from the possibility of retention or reduction of funds in the event of
an unmanageable budget deficit, the DBM comments as follows:
Unfortunately, the sponsorship speech of Cong. Rolando G. Andaya, Jr. Chairman of
the House Committee on Appropriations in justifying the introduction of Sections 63
and 64 (sic) in the FY 2002 GAA, belies such contention. x x x In his speech, he
states that the incorporation of Section 62 is due to concerns raised by Congressmen
on the general impoundment powers of the President, without distinguishing as to the
two types of public institutions. More revealing is his explanation in introducing
Section 63, which defines unmanageable national government deficit. He states that
in order to discourage the Executive Department from reducing the Internal Revenue
Allotment of local government units, there is need to define the legal parameters of
"unmanageable deficit". Reference to local government units, which likewise enjoy
fiscal autonomy according to the pronouncements of this Honorable Court [Pimentel,
Jr. v. Aguirre, 336 SCRA 201 at 218 (2000)], reveal the true intent of Congress to
cover both agencies vested with fiscal autonomy and those without. x x x"8
(Underscoring supplied)
The Court, however, has examined the speech of Congressman Andaya and finds
nothing therein that detracts from its ruling. It bears emphasis that this Court
explicitly observed that Sections 62 and 63 refer to government agencies in general,
while Section 64 applies specifically to agencies with fiscal autonomy. It is in these
three provisions read together, and not in reading each one in isolation, that the
distinction intended by the legislature becomes evident.

10

When Congressman Andaya introduced Sections 62 and 63, he was thus speaking of
government agencies in general. If he did not then expressly distinguish between
agencies with fiscal autonomy and those without, it was because there was no
pressing need for him to do so. Particularly with regard to Section 62, his speech
would reveal that his attention was on a matter that did not call for such distinction,
namely, the "deep concern, frustration and despair" expressed by numerous members
of Congress "over the impoundment of appropriations by the Department of Budget
and Management and the Office of the President" which, he explained, provided the
reason behind Section 62 of the GAA.
As for the mention of local governments in Congressman Andayas introduction of
Section 63, the same does not imply that said provision was meant to include the
agencies belonging to the CFAG. In fact, his speech even suggests that Section 63,
rather than itself being an authorization to the DBM to withhold or reduce
appropriations, was merely intended to set a guiding principle for the DBM in those
cases where it already has authority to withhold or reduce such appropriations.
In the case of LGUs, the Congressman explicitly referred to "the provisions of the
Local Government Code, R.A. 7160 which authorizes the reduction of the IRA in the
event that there is an unmanageable deficit of the National Government."9 He then
stated that Section 63 was prompted by the need to set parameters in determining the
existence of an "unmanageable deficit."
On the other hand, there is no similar authorization for such reduction in the case of
agencies belonging to the CFAG not even during an "unmanageable deficit"
either in the Constitution or in statute. Thus, notwithstanding the inclusion of LGUs,
there is no basis for supposing that the agencies belonging to the CFAG are also
covered by Section 63 of the GAA.
The DBM furthermore argues that this Courts Resolution of June 3, 1993 in A.M.
No. 92-9-029-SC10 (the Resolution) reading:
After approval by Congress, the appropriations for the Judiciary shall be
automatically and regularly released subject to availability of funds. (Underscoring
supplied)
means that fund releases may still be subject to a cash release program.
In support of this argument, the DBM cites a letter dated May 18, 1993 of then Chief
Presidential Legal Counsel Antonio T. Carpio (now a member of this Court) to the
Secretary of Budget and Management, regarding A.M. No. 92-9-029-SC then
pending with this Court.
The letter quotes then Chief Justice Narvasas summary of this Courts position on
the controversy, which summary states, inter alia:
"4) the Court will look to releases by the DBM of funds against the approved budget
of the Judiciary, in the full amount sought and promptly upon notice; it is willing to

consider and pass upon suggestions by the DBM for scheduling of releases; x x
x"(Underscoring supplied)
In the same letter, the Chief Presidential Legal Counsel, after considering the Courts
position, opined that one of the principles by which the constitutional mandate on
judicial fiscal autonomy can be achieved is that "[a]fter approval by Congress, the
appropriations for the judiciary shall be automatically and regularly released subject
to availability of funds" which opinion, the DBM alleges, is the position adopted
by this Court.
Instead of supporting the DBMs position, however, this letter only shows the
consistency of this Court in interpreting "automatic release" as requiring the full
release of appropriations. The Courts willingness to pass upon suggestions for
scheduling of releases in no way implies that it was assenting to an incomplete or
delayed release of funds. Rather, it was a recognition by this Court that scheduling of
releases, as such, does not violate the Constitution and is, in fact, presupposed in the
phrase "automatically and regularly released."
The phrase "subject to availability of funds" must thus be understood in harmony
with the constitutional mandate to automatically release funds as the same has been
consistently interpreted by this Court. It is not an authority for the DBM to
implement a policy which, although labeled "cash payment schedule," actually goes
beyond mere scheduling of releases and
effects a withholding and reduction of the approved appropriations, as it did in the
present case against petitioner Civil Service Commission.
Finally, while acknowledging the unconstitutionality of imposing a "no report, no
release" policy on agencies clothed with fiscal autonomy, the DBM prays for a
clarification that such agencies are still responsible for the timely submission to it of
financial reports. The Court considers it sufficient to echo the following statements
in the Separate Opinion of former Chief Justice Hilario G. Davide, Jr.:
This is not to say that agencies vested with fiscal autonomy have no reporting
responsibility at all to the DBM. This is precisely the reason why guideline No. 5
under the Resolution of 3 June [1993 states that the Supreme Court, or constitutional
commissions clothed with fiscal autonomy for that matter, may submit reports
relative to its appropriation "for records purposes only." The word "may" is
permissive [Dizon v. Encarnacion, 119 Phil. 20, 22 (1963)], as it is an auxiliary verb
manifesting "opportunity or possibility" and, under ordinary circumstances, "implies
the possible existence of something." [Supangan, Jr. v. Santos, G.R. No. 84663, 24
August 1990 x x x Interdependence will work only if it is undertaken within the
parameters of the Constitution."
WHEREFORE, the Motion for Reconsideration of respondent Department of
Budget and Management is DENIED.
SO ORDERED.
[G.R. No. 133486. January 28, 2000]

EN BANC

ABS-CBN BROADCASTING CORPORATION, petitioner, vs. COMMISSION ON


ELECTIONS, respondent.

11

DECISION

approved the issuance of a restraining order enjoining the petitioner or any [other
group], its agents or representatives from conducting exit polls during the x x x May
11 elections."[3]

PANGANIBAN, J.:
The holding of exit polls and the dissemination of their results through mass media
constitute an essential part of the freedoms of speech and of the press. Hence, the
Comelec cannot ban them totally in the guise of promoting clean, honest, orderly and
credible elections. Quite the contrary, exit polls -- properly conducted and publicized
-- can be vital tools in eliminating the evils of election-fixing and fraud. Narrowly
tailored countermeasures may be prescribed by the Comelec so as to minimize or
suppress the incidental problems in the conduct of exit polls, without transgressing in
any manner the fundamental rights of our people.
The Case and the Facts
Before us is a Petition for Certiorari under Rule 65 of the Rules of Court assailing
Commission on Elections (Comelec) en banc Resolution No. 98-1419[1] dated April
21, 1998. In the said Resolution, the poll body
"RESOLVED to approve the issuance of a restraining order to stop ABS-CBN or any
other groups, its agents or representatives from conducting such exit survey and to
authorize the Honorable Chairman to issue the same."
The Resolution was issued by the Comelec allegedly upon "information from [a]
reliable source that ABS-CBN (Lopez Group) has prepared a project, with PR
groups, to conduct radio-TV coverage of the elections x x x and to make [an] exit
survey of the x x x vote during the elections for national officials particularly for
President and Vice President, results of which shall be [broadcast] immediately."[2]
The electoral body believed that such project might conflict with the official
Comelec count, as well as the unofficial quick count of the National Movement for
Free Elections (Namfrel). It also noted that it had not authorized or deputized
Petitioner ABS-CBN to undertake the exit survey.
On May 9, 1998, this Court issued the Temporary Restraining Order prayed for by
petitioner. We directed the Comelec to cease and desist, until further orders, from
implementing the assailed Resolution or the restraining order issued pursuant thereto,
if any. In fact, the exit polls were actually conducted and reported by media without
any difficulty or problem.
The Issues
Petitioner raises this lone issue: "Whether or not the Respondent Commission acted
with grave abuse of discretion amounting to a lack or excess of jurisdiction when it

In his Memorandum,[4] the solicitor general, in seeking to dismiss the Petition,


brings up additional issues: (1) mootness and (2) prematurity, because of petitioner's
failure to seek a reconsideration of the assailed Comelec Resolution.
The Court's Ruling
The Petition[5] is meritorious.
Procedural Issues: Mootness and Prematurity
The solicitor general contends that the petition is moot and academic, because the
May 11, 1998 election has already been held and done with. Allegedly, there is no
longer any actual controversy before us.
The issue is not totally moot. While the assailed Resolution referred specifically to
the May 11, 1998 election, its implications on the people's fundamental freedom of
expression transcend the past election. The holding of periodic elections is a basic
feature of our democratic government. By its very nature, exit polling is tied up with
elections. To set aside the resolution of the issue now will only postpone a task that
could well crop up again in future elections.[6]
In any event, in Salonga v. Cruz Pano, the Court had occasion to reiterate that it "also
has the duty to formulate guiding and controlling constitutional principles, precepts,
doctrines, or rules. It has the symbolic function of educating bench and bar on the
extent of protection given by constitutional guarantees."[7] Since the fundamental
freedoms of speech and of the press are being invoked here, we have resolved to
settle, for the guidance of posterity, whether they likewise protect the holding of exit
polls and the dissemination of data derived therefrom.
The solicitor general further contends that the Petition should be dismissed for
petitioner's failure to exhaust available remedies before the issuing forum,
specifically the filing of a motion for reconsideration.
This Court, however, has ruled in the past that this procedural requirement may be
glossed over to prevent a miscarriage of justice,[8] when the issue involves the
principle of social justice or the protection of labor,[9] when the decision or
resolution sought to be set aside is a nullity,[10] or when the need for relief is
extremely urgent and certiorari is the only adequate and speedy remedy available.
[11]

12

The instant Petition assails a Resolution issued by the Comelec en banc on April 21,
1998, only twenty (20) days before the election itself. Besides, the petitioner got hold
of a copy thereof only on May 4, 1998. Under the circumstances, there was hardly
enough opportunity to move for a reconsideration and to obtain a swift resolution in
time for the May 11, 1998 elections. Moreover, not only is time of the essence; the
Petition involves transcendental constitutional issues. Direct resort to this Court
through a special civil action for certiorari is therefore justified.
Main Issue: Validity of Conducting Exit Polls
An exit poll is a species of electoral survey conducted by qualified individuals or
groups of individuals for the purpose of determining the probable result of an
election by confidentially asking randomly selected voters whom they have voted
for, immediately after they have officially cast their ballots. The results of the survey
are announced to the public, usually through the mass media, to give an advance
overview of how, in the opinion of the polling individuals or organizations, the
electorate voted. In our electoral history, exit polls had not been resorted to until the
recent May 11, 1998 elections.
In its Petition, ABS-CBN Broadcasting Corporation maintains that it is a responsible
member of the mass media, committed to report balanced election-related data,
including "the exclusive results of Social Weather Station (SWS) surveys conducted
in fifteen administrative regions."
It argues that the holding of exit polls and the nationwide reporting of their results
are valid exercises of the freedoms of speech and of the press. It submits that, in
precipitately and unqualifiedly restraining the holding and the reporting of exit polls,
the Comelec gravely abused its discretion and grossly violated the petitioner's
constitutional rights.
Public respondent, on the other hand, vehemently denies that, in issuing the assailed
Resolution, it gravely abused its discretion. It insists that the issuance thereof was
"pursuant to its constitutional and statutory powers to promote a clean, honest,
orderly and credible May 11, 1998 elections"; and "to protect, preserve and maintain
the secrecy and sanctity of the ballot." It contends that "the conduct of exit surveys
might unduly confuse and influence the voters," and that the surveys were designed
"to condition the minds of people and cause confusion as to who are the winners and
the [losers] in the election," which in turn may result in "violence and anarchy."
Public respondent further argues that "exit surveys indirectly violate the
constitutional principle to preserve the sanctity of the ballots," as the "voters are
lured to reveal the contents of ballots," in violation of Section 2, Article V of the
Constitution;[12] and relevant provisions of the Omnibus Election Code.[13] It
submits that the constitutionally protected freedoms invoked by petitioner "are not

immune to regulation by the State in the legitimate exercise of its police power,"
such as in the present case.
The solicitor general, in support of the public respondent, adds that the exit polls
pose a "clear and present danger of destroying the credibility and integrity of the
electoral process," considering that they are not supervised by any government
agency and can in general be manipulated easily. He insists that these polls would
sow confusion among the voters and would undermine the official tabulation of votes
conducted by the Commission, as well as the quick count undertaken by the Namfrel.
Admittedly, no law prohibits the holding and the reporting of exit polls. The question
can thus be more narrowly defined: May the Comelec, in the exercise of its powers,
totally ban exit polls? In answering this question, we need to review quickly our
jurisprudence on the freedoms of speech and of the press.
Nature and Scope of Freedoms of Speech and of the Press
The freedom of expression is a fundamental principle of our democratic government.
It "is a 'preferred' right and, therefore, stands on a higher level than substantive
economic or other liberties. x x x [T]his must be so because the lessons of history,
both political and legal, illustrate that freedom of thought and speech is the
indispensable condition of nearly every other form of freedom."[14]
Our Constitution clearly mandates that no law shall be passed abridging the freedom
of speech or of the press.[15] In the landmark case Gonzales v. Comelec,[16] this
Court enunciated that at the very least, free speech and a free press consist of the
liberty to discuss publicly and truthfully any matter of public interest without prior
restraint.
The freedom of expression is a means of assuring individual self-fulfillment, of
attaining the truth, of securing participation by the people in social and political
decision-making, and of maintaining the balance between stability and change.[17] It
represents a profound commitment to the principle that debates on public issues
should be uninhibited, robust, and wide open.[18] It means more than the right to
approve existing political beliefs or economic arrangements, to lend support to
official measures, or to take refuge in the existing climate of opinion on any matter
of public consequence. And paraphrasing the eminent justice Oliver Wendell
Holmes,[19] we stress that the freedom encompasses the thought we hate, no less
than the thought we agree with.
Limitations
The realities of life in a complex society, however, preclude an absolute exercise of
the freedoms of speech and of the press. Such freedoms could not remain unfettered

13

and unrestrained at all times and under all circumstances.[20] They are not immune
to regulation by the State in the exercise of its police power.[21] While the liberty to
think is absolute, the power to express such thought in words and deeds has
limitations.
In Cabansag v. Fernandez[22] this Court had occasion to discuss two theoretical tests
in determining the validity of restrictions to such freedoms, as follows:
"These are the 'clear and present danger' rule and the 'dangerous tendency' rule. The
first, as interpreted in a number of cases, means that the evil consequence of the
comment or utterance must be 'extremely serious and the degree of imminence
extremely high' before the utterance can be punished. The danger to be guarded
against is the 'substantive evil' sought to be prevented. x x x"[23]
"The 'dangerous tendency' rule, on the other hand, x x x may be epitomized as
follows: If the words uttered create a dangerous tendency which the state has a right
to prevent, then such words are punishable. It is not necessary that some definite or
immediate acts of force, violence, or unlawfulness be advocated. It is sufficient that
such acts be advocated in general terms. Nor is it necessary that the language used be
reasonably calculated to incite persons to acts of force, violence, or unlawfulness. It
is sufficient if the natural tendency and probable effect of the utterance be to bring
about the substantive evil which the legislative body seeks to prevent."[24]
Unquestionably, this Court adheres to the "clear and present danger" test. It
implicitly did in its earlier decisions in Primicias v. Fugoso[25] and American Bible
Society v. City of Manila;[26] as well as in later ones, Vera v. Arca,[27] Navarro v.
Villegas,[28] Imbong v. Ferrer,[29] Blo Umpar Adiong v. Comelec[30] and, more
recently, in Iglesia ni Cristo v. MTRCB.[31] In setting the standard or test for the
"clear and present danger" doctrine, the Court echoed the words of justice Holmes:
"The question in every case is whether the words used are used in such
circumstances and are of such a nature as to create a clear and present danger that
they will bring about the substantive evils that Congress has a right to prevent. It is a
question of proximity and degree."[32]
A limitation on the freedom of expression may be justified only by a danger of such
substantive character that the state has a right to prevent. Unlike in the "dangerous
tendency" doctrine, the danger must not only be clear but also present. "Present"
refers to the time element; the danger must not only be probable but very likely to be
inevitable.[33] The evil sought to be avoided must be so substantive as to justify a
clamp over one's mouth or a restraint of a writing instrument.[34]
Justification for a Restriction

Doctrinally, the Court has always ruled in favor of the freedom of expression, and
any restriction is treated an exemption. The power to exercise prior restraint is not to
be presumed; rather the presumption is against its validity.[35] And it is respondent's
burden to overthrow such presumption. Any act that restrains speech should be
greeted with furrowed brows,[36] so it has been said.
To justify a restriction, the promotion of a substantial government interest must be
clearly shown.[37] Thus:
"A government regulation is sufficiently justified if it is within the constitutional
power of the government, if it furthers an important or substantial government
interest; if the governmental interest is unrelated to the suppression of free
expression; and if the incidental restriction on alleged First Amendment freedoms is
no greater than is essential to the furtherance of that interest."[38]
Hence, even though the government's purposes are legitimate and substantial, they
cannot be pursued by means that broadly, stifle fundamental personal liberties, when
the end can be more narrowly achieved.[39]
The freedoms of speech and of the press should all the more be upheld when what is
sought to be curtailed is the dissemination of information meant to add meaning to
the equally vital right of suffrage.[40] We cannot support any ruling or order "the
effect of which would be to nullify so vital a constitutional right as free speech."[41]
When faced with borderline situations in which the freedom of a candidate or a party
to speak or the freedom of the electorate to know is invoked against actions allegedly
made to assure clean and free elections, this Court shall lean in favor of freedom. For
in the ultimate analysis, the freedom of the citizen and the State's power to regulate
should not be antagonistic. There can be no free and honest elections if, in the efforts
to maintain them, the freedom to speak and the right to know are unduly curtailed.
[42]
True, the government has a stake in protecting the fundamental right to vote by
providing voting places that are safe and accessible. It has the duty to secure the
secrecy of the ballot and to preserve the sanctity and the integrity of the electoral
process. However, in order to justify a restriction of the people's freedoms of speech
and of the press, the state's responsibility of ensuring orderly voting must far
outweigh them.
These freedoms have additional importance, because exit polls generate important
research data which may be used to study influencing factors and trends in voting
behavior. An absolute prohibition would thus be unreasonably restrictive, because it
effectively prevents the use of exit poll data not only for election-day projections, but
also for long-term research.[43]

14

Comelec Ban on Exit Polling


In the case at bar, the Comelec justifies its assailed Resolution as having been issued
pursuant to its constitutional mandate to ensure a free, orderly, honest, credible and
peaceful election. While admitting that "the conduct of an exit poll and the broadcast
of the results thereof [are] x x x an exercise of press freedom," it argues that "[p]ress
freedom may be curtailed if the exercise thereof creates a clear and present danger to
the community or it has a dangerous tendency." It then contends that "an exit poll has
the tendency to sow confusion considering the randomness of selecting interviewees,
which further make[s] the exit poll highly unreliable. The probability that the results
of such exit poll may not be in harmony with the official count made by the Comelec
x x x is ever present. In other words, the exit poll has a clear and present danger of
destroying the credibility and integrity of the electoral process."
Such arguments are purely speculative and clearly untenable. First, by the very
nature of a survey, the interviewees or participants are selected at random, so that the
results will as much as possible be representative or reflective of the general
sentiment or view of the community or group polled. Second, the survey result is not
meant to replace or be at par with the official Comelec count. It consists merely of
the opinion of the polling group as to who the electorate in general has probably
voted for, based on the limited data gathered from polled individuals. Finally, not at
stake here are the credibility and the integrity of the elections, which are exercises
that are separate and independent from the exit polls. The holding and the reporting
of the results of exit polls cannot undermine those of the elections, since the former
is only part of the latter. If at all, the outcome of one can only be indicative of the
other.
The Comelec's concern with the possible noncommunicative effect of exit polls -disorder and confusion in the voting centers -- does not justify a total ban on them.
Undoubtedly, the assailed Comelec Resolution is too broad, since its application is
without qualification as to whether the polling is disruptive or not.[44] Concededly,
the Omnibus Election Code prohibits disruptive behavior around the voting centers.
[45] There is no showing, however, that exit polls or the means to interview voters
cause chaos in voting centers. Neither has any evidence been presented proving that
the presence of exit poll reporters near an election precinct tends to create disorder or
confuse the voters.
Moreover, the prohibition incidentally prevents the collection of exit poll data and
their use for any purpose. The valuable information and ideas that could be derived
from them, based on the voters' answers to the survey questions will forever remain
unknown and unexplored. Unless the ban is restrained, candidates, researchers,
social scientists and the electorate in general would be deprived of studies on the
impact of current events and of election-day and other factors on voters' choices.

In Daily Herald Co. v. Munro,[46] the US Supreme Court held that a statute, one of
the purposes of which was to prevent the broadcasting of early returns, was
unconstitutional because such purpose was impermissible, and the statute was neither
narrowly tailored to advance a state interest nor the least restrictive alternative.
Furthermore, the general interest of the State in insulating voters from outside
influences is insufficient to justify speech regulation. Just as curtailing election-day
broadcasts and newspaper editorials for the reason that they might indirectly affect
the voters' choices is impermissible, so is regulating speech via an exit poll
restriction.[47]
The absolute ban imposed by the Comelec cannot, therefore, be justified. It does not
leave open any alternative channel of communication to gather the type of
information obtained through exit polling. On the other hand, there are other valid
and reasonable ways and means to achieve the Comelec end of avoiding or
minimizing disorder and confusion that may be brought about by exit surveys.
For instance, a specific limited area for conducting exit polls may be designated.
Only professional survey groups may be allowed to conduct the same. Pollsters may
be kept at a reasonable distance from the voting center. They may be required to
explain to voters that the latter may refuse to be interviewed, and that the interview is
not part of the official balloting process. The pollsters may further be required to
wear distinctive clothing that would show they are not election officials.[48]
Additionally, they may be required to undertake an information campaign on the
nature of the exercise and the results to be obtained therefrom. These measures,
together with a general prohibition of disruptive behavior, could ensure a clean, safe
and orderly election.
For its part, Petitioner ABS-CBN explains its survey methodology as follows: (1)
communities are randomly selected in each province; (2) residences to be polled in
such communities are also chosen at random; (3) only individuals who have already
voted, as shown by the indelible ink on their fingers, are interviewed; (4) the
interviewers use no cameras of any sort; (5) the poll results are released to the public
only on the day after the elections.[49] These precautions, together with the possible
measures earlier stated, may be undertaken to abate the Comelec's fear, without
consequently and unjustifiably stilling the people's voice.
With the foregoing premises, we conclude that the interest of the state in reducing
disruption is outweighed by the drastic abridgment of the constitutionally guaranteed
rights of the media and the electorate. Quite the contrary, instead of disrupting
elections, exit polls -- properly conducted and publicized -- can be vital tools for the
holding of honest, orderly, peaceful and credible elections; and for the elimination of
election-fixing, fraud and other electoral ills.
Violation of Ballot Secrecy

15

The contention of public respondent that exit polls indirectly transgress the sanctity
and the secrecy of the ballot is off-tangent to the real issue. Petitioner does not seek
access to the ballots cast by the voters. The ballot system of voting is not at issue
here.
The reason behind the principle of ballot secrecy is to avoid vote buying through
voter identification. Thus, voters are prohibited from exhibiting the contents of their
official ballots to other persons, from making copies thereof, or from putting
distinguishing marks thereon so as to be identified. Also proscribed is finding out the
contents of the ballots cast by particular voters or disclosing those of disabled or
illiterate voters who have been assisted. Clearly, what is forbidden is the association
of voters with their respective votes, for the purpose of assuring that the votes have
been cast in accordance with the instructions of a third party. This result cannot,
[G. R. No. 140335. December 13, 2000]
THELMA P. GAMINDE, petitioner, vs. COMMISSION ON AUDIT and/or Hon.
CELSO D. GANGAN, Hon. RAUL C. FLORES and EMMANUEL M. DALMAN,
respondents.
DECISION
PARDO, J.:
The Case
The case is a special civil action of certiorari seeking to annul and set aside two
decisions of the Commission on Audit ruling that petitioners term of office as
Commissioner, Civil Service Commission, to which she was appointed on June 11,
1993, expired on February 02, 1999, as set forth in her appointment paper.
The Facts
On June 11, 1993, the President of the Philippines appointed petitioner Thelma P.
Gaminde, ad interim, Commissioner, Civil Service Commission. She assumed office
on June 22, 1993, after taking an oath of office. On September 07, 1993, the
Commission on Appointment, Congress of the Philippines confirmed the
appointment. We quote verbatim her appointment paper:
11 June 1993

however, be achieved merely through the voters' verbal and confidential disclosure to
a pollster of whom they have voted for.
In exit polls, the contents of the official ballot are not actually exposed. Furthermore,
the revelation of whom an elector has voted for is not compulsory, but voluntary.
Voters may also choose not to reveal their identities. Indeed, narrowly tailored
countermeasures may be prescribed by the Comelec, so as to minimize or suppress
incidental problems in the conduct of exit polls, without transgressing the
fundamental rights of our people.
WHEREFORE, the Petition is GRANTED, and the Temporary Restraining Order
issued by the Court on May 9, 1998 is made PERMANENT. Assailed Minute
Resolution No. 98-1419 issued by the Comelec en banc on April 21, 1998 is hereby
NULLIFIED and SET ASIDE. No costs.
Pursuant to the provisions of existing laws, you are hereby appointed, ad interim,
COMMISSIONER, CIVIL SERVICE COMMISSION, for a term expiring February
2, 1999.
By virtue hereof, you may qualify and enter upon the performance of the duties of
the office, furnishing this Office and the Civil Service Commission with copies of
your oath of office.[1]
However, on February 24, 1998, petitioner sought clarification from the Office of the
President as to the expiry date of her term of office. In reply to her request, the Chief
Presidential Legal Counsel, in a letter dated April 07, 1998[2] opined that petitioners
term of office would expire on February 02, 2000, not on February 02, 1999.
Relying on said advisory opinion, petitioner remained in office after February 02,
1999. On February 04, 1999, Chairman Corazon Alma G. de Leon, wrote the
Commission on Audit requesting opinion on whether or not Commissioner Thelma P.
Gaminde and her co-terminous staff may be paid their salaries notwithstanding the
expiration of their appointments on February 02, 1999.
On February 18, 1999, the General Counsel, Commission on Audit, issued an
opinion that the term of Commissioner Gaminde has expired on February 02, 1999
as stated in her appointment conformably with the constitutional intent.[3]
Consequently, on March 24, 1999, CSC Resident Auditor Flovitas U. Felipe issued
notice of disallowance No. 99-002-101 (99), disallowing in audit the salaries and
emoluments pertaining to petitioner and her co-terminous staff, effective February
02, 1999.[4]

Madam:
On April 5, 1999, petitioner appealed the disallowance to the Commission on Audit
en banc. On June 15, 1999, the Commission on Audit issued Decision No. 99-090

16

dismissing petitioners appeal. The Commission on Audit affirmed the propriety of


the disallowance, holding that the issue of petitioners term of office may be properly
addressed by mere reference to her appointment paper which set the expiration date
on February 02, 1999, and that the Commission is bereft of power to recognize an
extension of her term, not even with the implied acquiescence of the Office of the
President.[5]
In time, petitioner moved for reconsideration; however, on August 17, 1999, the
Commission on Audit denied the motion in Decision No. 99-129.[6]
Hence, this petition.[7]
The Issue
The basic issue raised is whether the term of office of Atty. Thelma P. Gaminde, as
Commissioner, Civil Service Commission, to which she was appointed on June 11,
1993, expired on February 02, 1999, as stated in the appointment paper, or on
February 02, 2000, as claimed by her.
The Courts Ruling
The term of office of the Chairman and members of the Civil Service Commission is
prescribed in the 1987 Constitution, as follows:
Section 1 (2). The Chairman and the Commissioners shall be appointed by the
President with the consent of the Commission on Appointments for a term of seven
years without reappointment. Of those first appointed, the Chairman shall hold office
for seven years, a Commissioner for five years, and another Commissioner for three
years, without reappointment. Appointment to any vacancy shall be only for the
unexpired term of the predecessor. In no case shall any Member be appointed or
designated in a temporary or acting capacity.[8]
The 1973 Constitution introduced the first system of a regular rotation or cycle in the
membership of the Civil Service Commission. The provision on the 1973
Constitution reads:
x x x The Chairman and the Commissioners shall be appointed by the Prime Minister
for a term of seven years without reappointment. Of the Commissioners first
appointed, one shall hold office for seven years, another for five years, and the third
for three years. Appointment to any vacancy shall be only for the unexpired portion
of the term of the predecessor.[9]
Actually, this was a copy of the Constitutional prescription in the amended 1935
Constitution of a rotational system for the appointment of the Chairman and

members of the Commission on Elections. The Constitutional amendment creating


an independent Commission on Elections provides as follows:
Section 1. There shall be an independent Commission on Elections composed of a
Chairman and two other Members to be appointed by the President with the consent
of the Commission on Appointments, who shall hold office for a term of nine years
and may not be reappointed. Of the Members of the Commission first appointed, one
shall hold office for nine years, another for six years, and the third for three years.
The Chairman and the other Members of the Commission on Elections may be
removed from office only by impeachment in the manner provided in this
Constitution."[10]
In Republic vs. Imperial,[11] we said that the operation of the rotational plan
requires two conditions, both indispensable to its workability: (1) that the terms of
the first three (3) Commissioners should start on a common date, and, (2) that any
vacancy due to death, resignation or disability before the expiration of the term
should only be filled only for the unexpired balance of the term.[12]
Consequently, the terms of the first Chairmen and Commissioners of the
Constitutional Commissions under the 1987 Constitution must start on a common
date, irrespective of the variations in the dates of appointments and qualifications of
the appointees, in order that the expiration of the first terms of seven, five and three
years should lead to the regular recurrence of the two-year interval between the
expiration of the terms.[13]
Applying the foregoing conditions to the case at bar, we rule that the appropriate
starting point of the terms of office of the first appointees to the Constitutional
Commissions under the 1987 Constitution must be on February 02, 1987, the date of
the adoption of the 1987 Constitution. In case of a belated appointment or
qualification, the interval between the start of the term and the actual qualification of
the appointee must be counted against the latter.[14]
In the law of public officers, there is a settled distinction between term and tenure.
[T]he term of an office must be distinguished from the tenure of the incumbent. The
term means the time during which the officer may claim to hold office as of right,
and fixes the interval after which the several incumbents shall succeed one another.
The tenure represents the term during which the incumbent actually holds the office.
The term of office is not affected by the hold-over. The tenure may be shorter than
the term for reasons within or beyond the power of the incumbent.[15]
In concluding that February 02, 1987 is the proper starting point of the terms of
office of the first appointees to the Constitutional Commissions of a staggered 7-5-3
year terms, we considered the plain language of Article IX (B), Section 1 (2), Article
IX (C), Section 1 (2) and Article IX (D), Section 1 (2) of the 1987 Constitution that

17

uniformly prescribed a seven-year term of office for Members of the Constitutional


Commissions, without re-appointment, and for the first appointees terms of seven,
five and three years, without re-appointment. In no case shall any Member be
appointed or designated in a temporary or acting capacity. There is no need to
expressly state the beginning of the term of office as this is understood to coincide
with the effectivity of the Constitution upon its ratification (on February 02, 1987).
On the other hand, Article XVIII, Transitory Provisions, 1987 Constitution provides:
SEC. 15. The incumbent Members of the Civil Service Commission, the
Commission on Elections, and the Commission on Audit shall continue in office for
one year after the ratification of this Constitution, unless they are sooner removed for
cause or become incapacitated to discharge the duties of their office or appointed to a
new term thereunder. In no case shall any Member serve longer than seven years
including service before the ratification of this Constitution.[16]
What the above quoted Transitory Provisions contemplate is tenure not term of the
incumbent Chairmen and Members of the Civil Service Commission, the
Commission on Elections and the Commission on Audit, who shall continue in office
for one year after the ratification of this Constitution, unless they are sooner removed
for cause or become incapacitated to discharge the duties of their office or appointed
to a new term thereunder. The term unless imports an exception to the general rule.
[17] Clearly, the transitory provisions mean that the incumbent members of the
Constitutional Commissions shall continue in office for one year after the ratification
of this Constitution under their existing appointments at the discretion of the
appointing power, who may cut short their tenure by: (1) their removal from office
for cause; (2) their becoming incapacitated to discharge the duties of their office, or
(3) their appointment to a new term thereunder, all of which events may occur before
the end of the one year period after the effectivity of the Constitution.
However, the transitory provisions do not affect the term of office fixed in Article IX,
providing for a seven-five-three year rotational interval for the first appointees under
this Constitution.
At the time of the adoption of the 1987 Constitution, the incumbent Chairman and
members of the Civil Service Commission were the following: (1) Chairperson
Celerina G. Gotladera. She was initially appointed as OIC Chairman on March 19,
1986, and appointed chairman on December 24, 1986, which she assumed on March
13, 1987. (2) Atty. Cirilo G. Montejo. On June 25, 1986, President Corazon C.
Aquino appointed him Commissioner, without any term. He assumed office on July
9, 1986, and served until March 31, 1987, when he filed a certificate of candidacy for
the position of Congressman, 2nd District, Leyte, thereby vacating his position as
Commissioner. His tenure was automatically cut-off by the filing of his certificate of
candidacy. (3) Atty. Mario D. Yango. On January 22, 1985, President Ferdinand E.

Marcos appointed him Commissioner for a term expiring January 25, 1990. He
served until February 2, 1988, when his term ended in virtue of the transitory
provisions referred to. On May 30, 1988, President Aquino re-appointed him to a
new three-year term and served until May 31, 1991, exceeding his lawful term, but
not exceeding the maximum of seven years, including service before the ratification
of the 1987 Constitution. Under this factual milieu, it was only Commissioner Yango
who was extended a new term under the 1987 Constitution. The period consumed
between the start of the term on February 02, 1987, and his actual assumption on
May 30, 1988, due to his belated appointment, must be counted against him.
Given the foregoing common starting point, we compute the terms of the first
appointees and their successors to the Civil Service Commission under the 1987
Constitution by their respective lines, as follows:
First line : Chairman seven-year term. February 02, 1987 to February 01, 1994. On
January 30, 1988, the President nominated Ms. Patricia A. Sto. Tomas Chairman,
Civil Service Commission. On March 02, 1988, the Commission on Appointments
confirmed the nomination. She assumed office on March 04, 1988. Her term ended
on February 02, 1994. She served as de facto Chairman until March 04, 1995. On
March 05, 1995, the President appointed then Social Welfare Secretary Corazon
Alma G. de Leon, Chairman, Civil Service Commission, to a regular seven-year
term. This term must be deemed to start on February 02, 1994, immediately
succeeding her predecessor, whose term started on the common date of the terms of
office of the first appointees under the 1987 Constitution. She assumed office on
March 22, 1995, for a term expiring February 02, 2001.
This is shown in her appointment paper, quoted verbatim as follows:
March 5, 1995
Madam:
Pursuant to the provisions of Article VII, Section 16, paragraph 2, of the
Constitution, you are hereby appointed, ad interim, CHAIRMAN, CIVIL SERVICE
COMMISSION, for a term expiring February 2, 2001.
By virtue hereof, you may qualify and enter upon the performance of the duties of
the office, furnishing this Office and the Civil Service Commission with copies of
your oath of office.
(Sgd.) FIDEL V. RAMOS
Second line : Commissioner Five-year term. February 02, 1987 to February 02,
1992. On January 30, 1988, the President nominated Atty. Samilo N. Barlongay

18

Commissioner, Civil Service Commission. On February 17, 1988, the Commission


on Appointments, Congress of the Philippines, confirmed the nomination. He
assumed office on March 04, 1988. His term ended on February 02, 1992. He served
as de facto Commissioner until March 04, 1993.
On June 11, 1993, the President appointed Atty. Thelma P. Gaminde Commissioner,
Civil Service Commission, for a term expiring February 02, 1999.[18] This terminal
date is specified in her appointment paper. On September 07, 1993, the Commission
on Appointments confirmed the appointment. She accepted the appointment and
assumed office on June 22, 1993. She is bound by the term of the appointment she
accepted, expiring February 02, 1999. In this connection, the letter dated April 07,
1998, of Deputy Executive Secretary Renato C. Corona[19] clarifying that her term
would expire on February 02, 2000, was in error. What was submitted to the
Commission on Appointments was a nomination for a term expiring on February 02,
1999. Thus, the term of her successor[20] must be deemed to start on February 02,
1999, and expire on February 02, 2006.

Commissioner, February 02, 1997 to February 02, 2004,[27] thereby consistently


maintaining the two-year interval.
The line of succession, terms of office and tenure of the Chairman and members of
the Civil Service Commission may be outlined as follows:[28]
Chairman Term Tenure
(7-year original)
Sto. Tomas 1st appointee Feb. 02, 1987 to Mar. 04, 1988 to
Feb. 02, 1994 March 08, 1995
De Leon 2nd appointee Feb. 02, 1994 to March 22, 1995 to
(incumbent) Feb. 02, 2001 Feb. 02, 2001

Third line : Commissioner Three-year term. February 02, 1987 to February 02, 1990.
Atty. Mario D. Yango was incumbent commissioner at the time of the adoption of the
1987 Constitution. His extended tenure ended on February 02, 1988. In May, 1988,
President Corazon C. Aquino appointed him Commissioner, Civil Service
Commission to a new three-year term thereunder. He assumed office on May 30,
1988. His term ended on February 02, 1990, but served as de facto Commissioner
until May 31, 1991. On November 26, 1991, the President nominated Atty. Ramon P.
Ereeta as Commissioner, Civil Service Commission. On December 04, 1991, the
Commission on Appointments confirmed the nomination. He assumed office on
December 12, 1991, for a term expiring February 02, 1997.[21]
Commendably, he voluntarily retired on February 02, 1997. On February 03, 1997,
President Fidel V. Ramos appointed Atty. Jose F. Erestain, Jr. Commissioner, Civil
Service Commission, for a term expiring February 02, 2004. He assumed office on
February 11, 1997.

_______ - 3rd appointee Feb. 02, 2001 to


Feb. 02, 2008
2nd Member Term Tenure
(5-year original)
Barlongay 1st appointee Feb. 02, 1987 to March 04, 1988 to
Feb. 02, 1992 March 04, 1993
Gaminde 2nd appointee Feb. 02, 1992 to June 11, 1993 to
Feb. 02, 1999 Feb. 02, 2000

Thus, we see the regular interval of vacancy every two (2) years, namely, February
02, 1994, for the first Chairman,[22] February 02, 1992, for the first five-year term
Commissioner,[23] and February 02, 1990, for the first three-year term
Commissioner.[24] Their successors must also maintain the two year interval,
namely: February 02, 2001, for Chairman;[25] February 02, 1999, for Commissioner
Thelma P. Gaminde, and February 02, 1997, for Commissioner Ramon P. Ereeta, Jr.

Valmores 3rd appointee Feb. 02, 1999 to Sept. 08, 2000 to


(incumbent) Feb. 02, 2006 Feb. 02, 2006
3rd Member Term Tenure

The third batch of appointees would then be having terms of office as follows:

(3-year original)

First line : Chairman, February 02, 2001 to February 02, 2008; Second line:
Commissioner, February 02, 1999 to February 02, 2006;[26] and, Third line:

Yango - 1st appointee Feb. 02, 1987 to May 30, 1988 to

19

Feb. 02, 1990 May 31, 1991


Ereeta 2nd appointee Feb. 02, 1990 to Dec. 12, 1991 to

she served as de facto officer in good faith until February 02, 2000, and thus entitled
to receive her salary and other emoluments for actual service rendered.
Consequently, the Commission on Audit erred in disallowing in audit such salary and
other emoluments, including that of her co-terminous staff.

Feb. 02, 1997 Feb. 02, 1997

(incumbent) Feb. 02, 2004 Feb. 02, 2004

ACCORDINGLY, we REVERSE the decisions of the Commission on Audit insofar


as they disallow the salaries and emoluments of Commissioner Thelma P. Gaminde
and her coterminous staff during her tenure as de facto officer from February 02,
1999, until February 02, 2000.

The Fallo

This decision shall be effective immediately.

WHEREFORE, we adjudge that the term of office of Ms. Thelma P. Gaminde as


Commissioner, Civil Service Commission, under an appointment extended to her by
President Fidel V. Ramos on June 11, 1993, expired on February 02, 1999. However,
[G.R. No. 129133. November 25, 1998]

No costs.

Erestain, Jr. 3rd appointee Feb. 02, 1997 to Feb. 11, 1997 to

ECONOMIC INTELLIGENCE AND INVESTIGATION BUREAU, petitioner, vs.


HON. COURT OF APPEALS and CIVIL SERVICE COMMISSION, respondents.

SO ORDERED.
Not having received any compliance from petitioners, respondent CSC, in its Order
of December 7, 1990, directed petitioner Jose T. Almonte to immediately implement
Resolution No. 89-400, with a warning that any EIIB official who shall fail or refuse
to comply with the said order shall be held liable for indirect contempt.

DECISION
PURISIMA, J.:
Before the Court is a Petition for Review on Certiorari under Rule 45 of the Revised
Rules of Court to review and set aside the 7 November 1996 Decision[1] and 18
March 1997 Resolution[2] of the Court of Appeals[3] in CA - G.R. SP No. 37720.
As culled by the Court of Appeals, the antecedent facts that matter are, as follows:
In a letter dated October 13, 1988, respondent CSC through Chairman Patricia A.
Sto. Tomas required the Secretary of Finance to submit to the CSC all appointments
in the Economic Intelligence and Investigation Bureau (EIIB).
Instead of complying with the said letter, petitioner Jose T. Almonte, as
Commissioner of EIIB, wrote a letter dated March 29, 1989, to respondent CSC,
requesting for confirmation of EIIBs exemption from CSC rules and regulations with
respect to appointments and other personnel actions invoking as basis for such
exemption PD No. 1458 and LOI No. 71.
On June 21, 1989, respondent CSC issued the subject Resolution No. 89-400,
denying petitioner Almontes request for exemption of the EIIB from the coverage of
the civil service rules and regulations and reiterating its order that petitioner EIIB
submit to the CSC all appointments to career or non-career positions in the Bureau.

On June 4, 1991, respondent CSC issued another order, requiring petitioner Almonte
to show cause why he should not be cited for indirect contempt for his continued
refusal to implement or comply with CSC Resolution No. 89-400 and the Order of
December 7, 1990.
In a letter, dated June 13, 1991, petitioner Almonte explained to the respondent CSC
the reasons of the EIIB for its inability to comply with Resolution No. 89-400. He
invoked PD No. 1458 and LOI No. 71 exempting the EIIB from the coverage of civil
service rules and regulations on appointments and other personnel actions. Petitioner
Almonte prayed that Resolution No. 89-400, the Order of June 4, 1991, and the
subsequent orders be set aside.
On August 22, 1991, respondent CSC issued an order, finding petitioner Almonte
guilty of indirect contempt of the Commission, the dispositive portion of which reads
as follows:
WHEREFORE, foregoing premises considered, the Commission hereby resolves to
find and adjudge Jose T. Almonte, Commissioner, EIIB, guilty of indirect contempt
of the Commission pursuant to Section 12 (11), Book V, Subtitle A of Executive
Order No. 292 and Memorandum Circular No. 42, series of 1990. He is thus meted
the penalty of fine P1,000.00 each day from the date of receipt of this Order dated
December 7, 1990. Accordingly, the Cashier of the EIIB is hereby directed to deduct
from the salary of Commissioner Almonte the amount of P1,000.00 each day of his

20

failure to comply with the above CSC Order. Let copies of this Order be furnished
the Resident Auditor of the EIIB as well as the COA, the Secretary of the
Department of Finance and the CSFO-DND, for their information and guidance.
SO ORDERED.

WHEREFORE, the Court upholds Resolution No. 89-400 but declares CSC Orders
of December 7, 1990, June 4, 1991, and of August 22, 1991, as NULL AND VOID,
the Civil Service Commission not having jurisdiction to cite and punish
Commissioner Jose T. Almonte of the Economic Intelligence and Investigation
Bureau for indirect contempt of the Commission.

Dissatisfied therewith, petitioner went to the Court of Appeals on a Petition for


Certiorari. However, on November 7, 1996, the Court of Appeals dismissed the
petition; ratiocinating thus:

With the denial of its motion for reconsideration by Resolution, dated March 18,
1997, of the Court of Appeals, petitioner found its way to this Court via the present
Petition; contending, that:

The 1987 Constitution is so clear and categorical in its mandate that:

IN HOLDING THAT PETITIONER IS COVERED BY CIVIL SERVICE,


RESPONDENT COURT VIOLATED P.D. No. 1458 AND LOI No. 71 WHICH
EXPRESSLY EXEMPT IT FROM CIVIL SERVICE COVERAGE.

Article IX (B), Section 2 (1). - The civil service embraces all branches, subdivisions,
instrumentalities, and agencies of the Government, including government-owned or
controlled corporations with original charters.
The civil service contemplated in the constitutional provision is very comprehensive
in its scope, that it includes every category of officer or employee of the government,
its branches, subdivisions and instrumentalities, and even employees of private
corporations, if such corporations are controlled or owned by the government with
original charters.
In the light of this constitutional mandate, petitioner EIIB, being a government
agency, is necessarily embraced by the civil service. The fact that positions in the
EIIB are primarily confidential did not place it outside the domain of civil servants,
since it is conceded that one holding in the Government a primarily confidential
position is in the Civil Service (Ingles v. Mutuc, 26 SCRA 171). That fact merely
exempts confidential positions in the EIIB from the constitutional rule that
appointments in the civil service shall be made only according to merit and fitness to
be determined, as far as practicable ... by competitive examination [Art. IX (B), Sec.
2 (2) ]. And it is in this sense that the provisions of PD 1458, particularly Section 5
and LOI 71 relied upon by the petitioners should be interpreted.
Neither does petitioners contention that if EIIBs positions and personnel actions will
be opened, one may know its operations, movements, targets, strategies, and tactics
and the whole of its being deserve merit, as the same is pure speculation and
conjecture. EIIB officials and personnel remain civil servants and as correctly argued
by the Solicitor General, EIIB officials occupying confidential positions, remain
accountable to the people and are subject to the same state policies on morale,
efficiency, integrity, responsiveness and courtesy in the civil service. Thus, We hold
that the personnel in the EEIB are covered by the civil service.
xxx

The pivotal issue here is: whether or not the petitioner, Economic Intelligence
Investigation Bureau (EIIB), is embraced by the Civil Service.
Section 2, subparagraph (1), Article IX, paragraph (B) of the 1987 Constitution
provides:
The civil service embraces all branches, subdivisions, instrumentalities, agencies of
the Government, including government-owned or controlled corporations with
original charter.
Succinct and clear is the provision of the Constitution in point that all government
agencies, without exception, are covered by the civil service.
Petitioner EIIB is a government agency under the Department of Finance as provided
by Section 17, Chapter 4, Title II, Book IV of the 1987 Administrative Code.[4]
Therefore, EIIB is within the ambit of the Civil Service Law.
The civil service within the contemplation of the aforecited constitutional provision
is comprehensive in scope. It embraces all officers and employees of the
government, its branches, subdivisions and instrumentalities. Even employees of
corporations owned or controlled by the government, with original charters, are
covered thereby.
Petitioner contends that EIIB is expressly exempted from civil service coverage,
under Section 5 of P.D. No. 1458, which provides :
Application of WAPCO and Civil Service Rules - Personnel of the FDIIB shall be
exempted from WAPCO and Civil Service Rules and Regulations relative to
appointments and other personnel actions: Provided, That they shall be entitled to the
benefits and privileges accorded to government employees ...

21

On the other hand, LOI No. 71, the Implementing Rules of P.D. No. 1458, reads:
10. It is further directed that personnel of the BII shall be exempt from OCPC and
Civil Service Rules and Regulations relative to appointments and other personnel
actions; Provided, That they shall be entitled to the benefits accorded to government
employees ... "
Petitioners submission is barren of merit.
The aforecited provisions of law provide for the exemption of petitioner EIIB only
from Civil Service Rules and Regulations relative to appointments and other
personnel actions, but not from the Civil Service Law or Civil Service Rules and
Regulations relative to any other matter.
Neither can we uphold petitioners reliance on Section 26 of Executive Order No.
127.[5] Petitioner, in gist, asserts exemption from Civil Service coverage since the
Bureau forms part of the intelligence community created under the said Executive
Order.
There is merit in the disquisition by the Court of Appeals that membership of
petitioner EIIB in the intelligence community is of no moment, insofar as application
of the Civil Service Law is concerned. The National Bureau of Investigation (NBI),
also a member of the intelligence community which performs functions similar to
those of EIIB, e.g., intelligence gathering, investigation, research, etc., submits to the
Civil Service Commission the appointments of all NBI personnel, whether belonging
to the career or non-career service. Besides, in Ingles vs. Mutuc, 26 SCRA 171, this
Court ruled that one holding in the Government a primarily confidential position is in
the Civil Service.
Equally untenable is petitioners contention that because the personnel of EIIB are
occupying jobs highly confidential in nature, the EIIB should not be required to
submit the names of its personnel to the Civil Service Commission.

vouchers of EIIB employees. The Bureau pleaded that such documents are classified,
and knowledge of EIIBs documents relative to its Personnel Services Funds and its
plantilla will inevitably lead to knowledge of its operations, movements, targets and
strategies, which could destroy the Bureau itself. The Court ruled that the required
documents can be examined by the Ombudsman, explaining that:
... [T]here is no claim that military or diplomatic secrets will be disclosed by the
production of records pertaining to the personnel of the EIIB. Indeed, EIIBs function
is the gathering and evaluation of intelligence reports and information regarding
illegal activities affecting the national economy, such as, but not limited to, economic
sabotage, smuggling, tax evasion, dollar salting. Consequently, while in cases which
involve state secrets it may be sufficient to determine from the circumstances of the
case that there is reasonable danger that compulsion of the evidence will expose
military matters without compelling production, no similar excuse can be made for a
privilege resting on other considerations.
Nor has our attention been called to any law or regulation which considers personnel
records of the EIIB as classified information ...
All things viewed in proper perspective, we are of the opinion, and so hold, that the
Court of Appeals erred not in holding that:
... [R]espondent CSCs act of requiring petitioner EIIB to submit to it all
appointments in the Bureau, for appropriate action, is part of its administrative
function as the central personnel agency of the government.
WHEREFORE, the petition is hereby DENIED; and the Decision of the Court of
Appeals in CA-GR SP No. 37720 AFFIRMED, without any pronouncement as to
costs.
SO ORDERED.
Narvasa, C.J., Davide Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan,
Mendoza, Panganiban, Martinez, Quisumbing, and Pardo, JJ., concur.

In Almonte vs. Vasquez, 244 SCRA 286 [1995], EIIB was ordered by the
Ombudsman to produce documents relating to personnel services and salary
FIRST DIVISION
DAVIDE, JR., C.J.:
[G.R. No. 141707. May 7, 2002]
CAYO G. GAMOGAMO, petitioner, vs. PNOC SHIPPING AND TRANSPORT
CORP., respondent.

The pivotal issue raised in the petition in this case is whether, for the purpose of
computing an employees retirement pay, prior service rendered in a government
agency can be tacked in and added to the creditable service later acquired in a
government-owned and controlled corporation without original charter.

DECISION

22

On 23 January 1963, Petitioner Cayo F. Gamogamo was first employed with the
Department of Health (DOH) as Dental Aide. On 22 February 1967, he was
promoted to the position of Dentist 1. He remained employed at the DOH for
fourteen years until he resigned on 2 November 1977.[1]
On 9 November 1977, petitioner was hired as company dentist by Luzon Stevedoring
Corporation (LUSTEVECO), a private domestic corporation.[2] Subsequently,
respondent PNOC Shipping and Transport Corporation (hereafter Respondent)
acquired and took over the shipping business of LUSTEVECO, and on 1 August
1979, petitioner was among those who opted to be absorbed by the Respondent.[3]
Thus, he continued to work as company dentist. In a letter dated 1 August 1979,
Respondent assumed without interruption petitioners service credits with
LUSTEVECO,[4] but it did not make reference to nor assumed petitioners service
credits with the DOH.
On 10 June 1993, then President Fidel V. Ramos issued a memorandum[5] approving
the privatization of PNOC subsidiaries, including Respondent, pursuant to the
provisions of Section III(B) of the Guidelines and Regulations to implement
Executive Order No. 37.[6] Accordingly, Respondent implemented a Manpower
Reduction Program to govern employees whose respective positions have been
classified as redundant as a result of Respondents decrease in operations and the
downsizing of the organization due to lay-up and sale of its vessels pursuant to its
direction towards privatization.[7] Under this program, retrenched employees shall
receive a two-month pay for every year of service.
Sometime in 1995, petitioner requested to be included in the next retrenchment
schedule. However, his request was turned down for the following reasons:[8]
1. As a company dentist he was holding a permanent position;
2. He was already due for mandatory retirement in April 1995 under his retirement
plan (first day of the month following his 60th birthday which was on 7 March
1995).
Eventually, petitioner retired after serving the Respondent and LUSTEVECO for 17
years and 4 months upon reaching his 60th birthday, on 1 April 1995. He received a
retirement pay of P512,524.15,[9] which is equivalent to one month pay for every
year of service and other benefits.

permanent/non-redundant positions but were willing to be retrenched under the


program were brought to the attention of the new president who ordered that a study
on the cost-effect of the retrenchment of these employees be conducted. After a
thorough study, Respondents Board of Directors recommended the approval of the
retrenchment. These two employees were retrenched and paid a 2-month separation
pay for every year of service under Respondents Manpower Reduction Program.[10]
In view of the action taken by Respondent in the retrenchment of Dr. Buena and Mrs.
Reyes, petitioner filed a complaint at the National Labor Relations Commission
(NLRC) for the full payment of his retirement benefits. Petitioner argued that his
service with the DOH should have been included in the computation of his years of
service. Hence, with an accumulated service of 32 years he should have been paid a
two-month pay for every year of service per the retirement plan and thus should have
received at least P1,833,920.00.
The Labor Arbiter dismissed petitioners complaint.[11] On appeal, however, the
NLRC reversed the decision of the Labor Arbiter. In its decision[12] of 28 November
1997, the NLRC ruled:
WHEREFORE, the Decision of the Labor Arbiter dated May 30, 1997 is hereby SET
ASIDE and another judgment is hereby rendered to wit:
(1) the government service of the complainant with the Department of Health
numbering fourteen (14) years is hereby considered creditable service for purposes
of computing his retirement benefits;
(2) crediting his fourteen (14) years service with the Department of Health, together
with his nearly eighteen (18) years of service with the respondent, complainant
therefore has almost thirty-two (32) years service upon which his retirement benefits
would be computed or based on;
(3) complainant is entitled to the full payment of his retirement benefits pursuant to
the respondents Retirement Law or the retrenchment program (Manpower Reduction
Program). In any case, he is entitled to two (2) months retirement/separation pay for
every year of service.
(4) all other claims are DISMISSED.
SO ORDERED.

On 30 August 1995, Admiral Carlito Y. Cunanan, Repondents president, died of


Dengue Fever and was forthwith replaced by Dr. Nemesio E. Prudente who assumed
office in December 1995. The new president implemented significant cost-saving
measures. In 1996, after petitioners retirement, the cases of Dr. Rogelio T. Buena
(company doctor) and Mrs. Luz C. Reyes (telephone operator), who were holding

Respondent filed a motion for reconsideration but it was denied.[13]


Unsatisfied with the reversal, Respondent filed with the Court of Appeals a special
civil action for certiorari which was docketed as CA-G.R. SP No. 51152. In its

23

decision[14] of 8 November 1999, the Court of Appeals set aside the NLRC
judgment and decreed:

benefits. Thus, pursuant to Respondents Manpower Reduction Program, he should


have been paid two months pay for every year of his 31 years of service.

WHEREFORE, the petition is hereby GIVEN DUE COURSE and the writ prayed
for GRANTED. Consequently, the Decision and Resolution of the National Labor
Relations Commission (Second Division) dated November 28, 1997 and May 15,
1998, respectively, are hereby SET ASIDE AND NULLIFIED, without prejudice to
private respondent Cayo F. Gamo-gamos recovery of whatever benefits he may have
been entitled to receive by reason of his fourteen (14) years of service with the
Department of Health.

Petitioner likewise asserts that the principle of tacking is anchored on Republic Act
No. 7699.[17]

No pronouncement as to costs.
His motion for reconsideration having been denied by the Court of Appeals,[15]
petitioner filed with us the petition in the case at bar. Petitioner contends that: (1) his
years of service with the DOH must be considered as creditable service for the
purpose of computing his retirement pay; and (2) he was discriminated against in the
application of the Manpower Reduction Program.[16]
Petitioner maintains that his government service with the DOH should be recognized
and tacked in to his length of service with Respondent because LUSTEVECO, which
was later bought by Respondent, and Respondent itself, were government-owned and
controlled corporations and were, therefore, under the Civil Service Law. Prior to the
separation of Respondent from the Civil Service by virtue of the 1987 Constitution,
petitioners length of service was considered continuous. The effectivity of the 1987
Constitution did not interrupt his continuity of service. He claims that he is supported
by the opinion of 18 May 1993 of the Civil Service Commission in the case of
Petron Corporation, where the Commission allegedly opined:
that all government services rendered by employees of the Petron prior to 1987
Constitution are considered creditable services for purposes of computation of
retirement benefits. This must necessarily be so considering that in the event that
Petron would consider only those services of an employee with Petron when it was
excluded from the civil service coverage (that is after the 1987 Constitution), it
would render nugatory his government agencies prior to his transfer to Petron.
Hence, Petron or any other PNOC subsidiary has to include in its retirement scheme
or in its Collective Bargaining Agreement a provision of the inclusion of the other
government services of its employees rendered outside Petron, otherwise, it would be
prejudicial to the interest of the retireable employee concerned.
Petitioner asserts that with the tacking in of his 14 years of service with the DOH to
his 17 years and 4 months service with LUSTEVECO and Respondent, he had 31
years and 4 months creditable service as basis for the computation of his retirement

Petitioner concludes that there was discrimination when his application for coverage
under the Manpower Reduction Program was disapproved. His application was
denied because he was holding a permanent position and that he was due for
retirement. However, Respondent granted the application of Dr. Rogelio Buena, who
was likewise holding a permanent position and was also about to retire. Petitioner
was only given one-month pay for every year of service under the regular retirement
plan while Dr. Buena was given a 2-month pay for every year of service under the
Manpower Reduction Program.
In its Comment to the petition, Respondent maintains that although it is a
government-owned and controlled corporation, it has no original charter. Hence, it is
not within the coverage of the Civil Service Law. It cites the decision in PNOC-EDC
v. Leogardo,[18] wherein we held that only corporations created by special charters
are subject to the provisions of the Civil Service Law. Those without original
charters are covered by the Labor Code. Respondent also asserts that R.A. No. 7699
is not applicable. Under this law an employee who has worked in both the private
and public sectors and has been covered by both the Government Service Insurance
System (GSIS) and the Social Security System (SSS), shall have his creditable
services or contributions in both Systems credited to his service or contribution
record in each of the Systems, which shall be summed up for purposes of old age,
disability, survivorship and other benefits in case the covered member does not
qualify for such benefits in either or both Systems without the totalization.
Respondent further contends that petitioner was not discriminated upon when his
application under the Manpower Reduction Program was denied. At the time of his
retirement in 1995, redundancy was the main consideration for qualification for the
Manpower Reduction Program. Petitioner was not qualified. However in 1996, in
order to solve the companys business reversals, the new president, Dr. Nemesio
Prudente, found it necessary to implement cost-saving strategies, among which was
the retrenchment of willing employees. Thus, the applications for retrenchment of
Dr. Buena and Mrs. Reyes were approved. Respondent had the prerogative to amend
its policies to meet the contingencies of the business for self-preservation.
We rule in the negative the issue of whether petitioners service with the DOH should
be included in the computation of his retirement benefits.
Respondents Retirement scheme[19] pertinently provides:

24

ARTICLE IV
RETIREMENT BENEFITS
SEC 4.1. Normal Retirement Date/Eligibility. -- The normal retirement date of an
employee shall be the first day of the month next following the employees sixtieth
(60th) birthday. To be eligible for the retirement benefit described under Sec. 4.2, the
employee must have rendered at least ten (10) years of continuous service with the
Company. In case the retiring employee has rendered less than ten (10) years of
service with the Company, he shall be entitled to one (1) months final monthly basic
salary (12/12) for every year of service.
SEC. 4.2. Normal Retirement Benefit. -- The retirement benefit shall be payable in
lump sum upon retirement which shall be determined on the basis of the retirees final
monthly basic salary (14/12) as follows:
(a) One (1) months pay for every year of service for those who have completed at
least twenty (20) years of continuous service with the Company.
(b) One and one-half (1 1/2) months pay for every year of service for those who have
completed twenty-one (21) to thirty (30) continuous years of service with the
Company.
(c) Two (2) months pay for every year of service for those who have completed at
least thirty-one (31) years of service with the Company.
It is clear therefrom that the creditable service referred to in the Retirement Plan is
the retirees continuous years of service with Respondent.
Retirement results from a voluntary agreement between the employer and the
employee whereby the latter after reaching a certain age agrees to sever his
employment with the former.[20]
Since the retirement pay solely comes from Respondents funds, it is but natural that
Respondent shall disregard petitioners length of service in another company for the
computation of his retirement benefits.
Petitioner was absorbed by Respondent from LUSTEVECO on 1 August 1979.
Ordinarily, his creditable service shall be reckoned from such date. However, since
Respondent took over the shipping business of LUSTEVECO and agreed to assume
without interruption all the service credits of petitioner with LUSTEVECO,[21]
petitioners creditable service must start from 9 November 1977 when he started
working with LUSTEVECO[22] until his day of retirement on 1 April 1995. Thus,
petitioners creditable service is 17.3333 years.

We cannot uphold petitioners contention that his fourteen years of service with the
DOH should be considered because his last two employers were government-owned
and controlled corporations, and fall under the Civil Service Law. Article IX(B),
Section 2 paragraph 1 of the 1987 Constitution states -Sec. 2. (1) The civil service embraces all branches, subdivisions, instrumentalities,
and agencies of the Government, including government-owned or controlled
corporations with original charters.
It is not at all disputed that while Respondent and LUSTEVECO are governmentowned and controlled corporations, they have no original charters; hence they are not
under the Civil Service Law. In Philippine National Oil Company-Energy
Development Corporation v. National Labor Relations Commission,[23] we ruled:
xxx Thus under the present state of the law, the test in determining whether a
government-owned or controlled corporation is subject to the Civil Service Law are
[sic] the manner of its creation, such that government corporations created by special
charter(s) are subject to its provisions while those incorporated under the General
Corporation Law are not within its coverage.
Consequently, Respondent was not bound by the opinion of the Civil Service
Commission of 18 May 1993.
Petitioners contention that the principle of tacking of creditable service is mandated
by Republic Act No. 7699 is baseless. Section 3 of Republic Act No. 7699 reads:
SEC 3. Provisions of any general or special law or rules and regulations to the
contrary notwithstanding, a covered worker who transfer(s) employment from one
sector to another or is employed in both sectors, shall have his creditable services or
contributions in both systems credited to his service or contribution record in each of
the Systems and shall be totalized for purposes of old-age, disability, survivorship,
and other benefits in case the covered employee does not qualify for such benefits in
either or both Systems without totalization: Provided, however, That overlapping
periods of membership shall be credited only once for purposes of totalization
(underscoring, ours).
Obviously, totalization of service credits is only resorted to when the retiree does not
qualify for benefits in either or both of the Systems. Here, petitioner is qualified to
receive benefits granted by the Government Security Insurance System (GSIS), if
such right has not yet been exercised. The pertinent provisions of law are:
SEC. 12 Old Age Pension. -- (a) xxx

25

(b) A member who has rendered at least three years but less than fifteen years of
service at the time of separation shall, upon reaching sixty years of age or upon
separation after age sixty, receive a cash payment equivalent to one hundred percent
of his average monthly compensation for every year of service with an employer
(Presidential Decree No, 1146, as amended, otherwise known as the Government
Service Insurance Act of 1977).
SEC. 4. All contributions paid by such member personally, and those that were paid
by his employers to both Systems shall be considered in the processing of benefits
which he can claim from either or both Systems: Provided, however, That the
amount of benefits to be paid by one System shall be in proportion to the number of
contributions actually remitted to that System (Republic Act No. 7699).
In any case, petitioners fourteen years of service with the DOH may not remain
uncompensated because it may be recognized by the GSIS pursuant to the
aforequoted Section 12, as may be determined by the GSIS. Since petitioner may be
entitled to some benefits from the GSIS, he cannot avail of the benefits under R.A.
No. 7699.
It may also be pointed out that upon his receipt of the amount of P512,524.15 from
Respondent as retirement benefit pursuant to its retirement scheme, petitioner signed
and delivered to Respondent a Release and Undertaking wherein he waives all
actions, causes of actions, debts, dues, monies and accounts in connection with his
employment with Respondent.[24] This quitclaim releases Respondent from any
other obligation in favor of petitioner. While quitclaims executed by employees are
[G.R. No. 144153. January 16, 2002]
MA. CHONA M. DIMAYUGA, petitioner, vs. MARIANO E. BENEDICTO II,
TOLL REGULATORY BOARD, GREGORIO R. VIGILAR, and RONALDO B.
ZAMORA, respondents.
DECISION
DE LEON, JR., J.:

commonly frowned upon as contrary to public policy and are ineffective to bar
claims for the full measure of the employees legal rights, there are legitimate waivers
that represent a voluntary and reasonable settlement of laborers claims which should
be respected by the courts as the law between the parties.[25] Settled is the rule that
not all quitclaims are per se invalid or against public policy, except (1) where there is
clear proof that the waiver was wangled from an unsuspecting or gullible person; and
(2) where the terms of settlement are unconscionable on their face.[26] We discern
nothing from the record that would suggest that petitioner was coerced, intimidated
or deceived into signing the Release and Undertaking. Neither are we convinced that
the consideration for the quitclaim is unconscionable because it is actually the full
amount of the retirement benefit provided for in the companys retirement plan.
In light of the foregoing, we need not discuss any further the issue of whether
petitioner was discriminated by Respondent in the implementation of the Manpower
Reduction Program. In any event, that issue is factual and petitioner has failed to
demonstrate that, indeed, he was discriminated upon.
WHEREFORE, no reversible error on the part of the Respondent Court of Appeals
having been shown, the petition in this case is DENIED and the appealed decision in
CA-G.R. SP No. 51152 is hereby AFFIRMED.
Costs against petitioner.
SO ORDERED.
Executive Director II of the Toll Regulatory Board (Board).[2] As its highest-ranking
working official, petitioner exercised powers of control and supervision over the
Boards three (3) divisions, namely its Finance and Administrative Division, the
Technical Division and the Engineering Division. She also oversaw the Boards
build-operate-and-transfer (BOT) projects, such as the Metro Manila Skyway Project
and the Manila-Cavite Tollway Project, and likewise participated in the negotiations
for the Manila-Subic Expressway Project and the South Luzon Tollway Extension
Project. At the time, the position of Executive Director II was not deemed part of the
career executive service, that is, until June 4, 1993, when it was included therein.

Before us is a petition for review on certiorari seeking the reversal of the Decision[1]
dated July 25, 2000 rendered by the former Seventeenth Division of the Court of
Appeals in CA-G.R. SP No. 54733 dismissing the quo warranto suit filed by
petitioner.

On May 31, 1994, the Civil Service Commission issued Memorandum Circular No.
21.[3] Section 4 of the Memorandum states:

The facts are:

4. Status of Appointment of Incumbents of Positions Included Under the Coverage of


the CES. Incumbents of positions which are declared to be Career Executive Service
positions for the first time pursuant to this Resolution who hold permanent
appointment thereto shall remain under permanent status in their respective

On October 26, 1992, then Secretary of Public Works and Highways Jose P. de Jesus
issued a permanent appointment in favor of petitioner Chona M. Dimayuga as

xxx xxx xxx

26

positions. However, upon promotion or transfer to other Career Executive Service


(CES) positions, these incumbents shall be under temporary status in said positions
until they qualify.
xxx xxx xxx
Petitioner alleges that during her tenure, she became the subject of several
administrative and criminal complaints designed to coerce her removal. On the
strength of these complaints, respondent former Department of Public Works and
Highways (DPWH) Secretary Gregorio R. Vigilar issued a first ninety-day
suspension order[4] against petitioner on November 28, 1997. Upon the expiration of
the first suspension, a second ninety-day suspension order[5] dated March 26, 1998
was issued against petitioner, this time by then Executive Secretary Alexander
Aguirre.[6]
On the expiration of the second suspension order, petitioner re-assumed her duties on
June 25, 1998. However, respondent Vigilar issued on the following day Department
Order No. 85, series of 1998,[7] by virtue of which petitioner was temporarily
detailed at the Office of the Secretary of the DPWH. Concurrently, he addressed a
Memorandum[8] dated June 26, 1998 to petitioner directing her to report to the
Legal Service of the Department to assist in the evaluation of appealed cases and
preparation of corresponding decisions thereon involving the implementation of P.D.
No. 1096, otherwise known as the National Building Code of the Philippines, and
other cases that may be assigned to her. As a gesture of protest, petitioner filed a
leave of absence until September 30, 1998 rather than assume a position which she
considered a demotion.
In the meantime, responding to a letter dated December 1, 1998[9] from petitioner
requesting a clarification on her status, the Career Executive Service Board (CESB)
replied in a letter dated December 15, 1998,[10] to wit:
xxx xxx xxx
It has always been the stand of the CES Board, even before the issuance of MC 21
by the CSC, to respect or honor the appointment status of an official appointed to a
position which is subsequently included in the CES, such that if the appointment was
of a permanent status or nature, the inclusion of the position in the CES is not
deemed to have changed the status of the appointee to the position. xxx
On September 28, 1998, while she was on leave, petitioner received a letter dated
September 22, 1998 from respondent Vigilar informing her that then President
Joseph E. Estrada had appointed respondent Mariano E. Benedicto II in her stead as
Executive Director II of the Board. The letter cited a Memorandum dated June 30,

1998[11] issued by then Executive Secretary Ronaldo B. Zamora addressed to all


heads of departments, agencies, and offices, as follows:
1. Pursuant to existing laws and jurisprudence, non-career officials/personnel or
those occupying political positions are deemed co-terminous with the outgoing
Administration.
2. Accordingly, they shall vacate their positions effective 01 July 1998 and turnover
their offices to the highest ranking career officials, unless otherwise specifically
retained by the Department Heads concerned or extended new appointments by the
President.
xxx xxx xxx
Since she had been effectively removed from her position, petitioner filed on
September 6, 1999 a petition for quo warranto before the Court of Appeals, docketed
as CA-G.R. SP No. 54733. On July 25, 2000, the appellate court rendered the
assailed decision dismissing petitioners suit. The appellate court held that:
xxx xxx xxx
In the case at bar, petitioner was appointed in a permanent capacity to the position of
Executive Director II of the TRB in 1992. At that time, said position was excluded
from the coverage of the CES, so petitioner was able to occupy said position
although she was not a career service executive officer (CESO). The subsequent
inclusion of her position under the CES, however, did not automatically qualify her
for the said position as she lacked the required eligibility. At most, the permanent
status accorded to her appointment would only allow her to occupy said position
until the appointing authority would replace her with someone who has the required
eligibility therefor.
The CSC, in issuing MC 21, could not have intended to unwittingly permit noncareer service officers to hold on defiantly and in a permanent character to career
service positions by virtue of their permanent appointments. Such a preposterous
interpretation characterized by (1) entrance based on merit and fitness to be
determined as far as practicable by competitive examinations, or based on highly
technical qualifications; (2) security of tenure; and (3) opportunity for advancement
to higher career positions. Moreover, such an unthinkable interpretation would lead
to an absurd situation wherein an incumbent could hold on to his post adamantly for
as long as he wants by reason of his permanent appointment, and even without
qualifying for said position.
xxx xxx xxx

27

Secondly, petitioner may not claim any proprietary right to her post as Executive
Director II of the TRB because this would encroach upon the executive powers of the
President. Such obstinate refusal by petitioner to vacate said position run counter to
the wide latitude given to the appointing authority or to the President, in this matter,
in exercising his power of appointment in accordance with the provisions of the
Constitution.

xxx xxx xxx


Aggrieved by the dismissal of her petition for quo warranto, petitioner comes to us
via the instant petition for review on certiorari, urging the reversal of the appellate
courts decision on the following grounds:
I

Moreover, if We were to espouse petitioners depthless construction of Section 4 of


MC 21, unqualified government employees would arrogate to themselves the right to
decide to stay permanently in their respective posts. This would leave the appointing
authority helpless in exercising his power of appointment that also includes the
power of removal.

THE COURT OF APPEALS COMMITTED A SERIOUS AND GRAVE ERROR IN


LAW WHEN IT HELD THAT PETITIONER HAS NO VESTED RIGHT TO THE
POSITION IN QUESTION.
II

Thirdly, petitioners claim to security of tenure must be rejected.


This Court has repeatedly held that this guaranty is available only to permanent
appointees [citation omitted].
Under the Administrative Code of 1987, a permanent appointment shall be issued to
a person who meets all the requirements for the position to which he is being
appointed, including the appropriate eligibility prescribed, in accordance with the
provisions of law, rules and standards promulgated in pursuance thereof.
Petitioner is not a CESO. Without the required eligibility for a career service
position, petitioner cannot be considered a permanent appointee under the law. As
stated, a permanent appointment is extended to a persons possessing the requisite
qualifications, including the eligibility required, for the position, and thus protected
by the constitutional guaranty of security of tenure. Since petitioner does not have
the prescribed CES eligibility for the position concerned, she can be removed from
office anytime because she does not have security of tenure.

THE COURT OF APPEALS COMMITTED A SERIOUS AND GRAVE ERROR IN


LAW WHEN IT HELD THAT PETITIONERS REFUSAL TO VACATE HER
POSITION RUNS COUNTER TO THE POWER OF APPOINTMENT AND
REMOVAL OF THE PRESIDENT.
III
THE COURT OF APPEALS COMMITTED A SERIOUS AND GRAVE ERROR IN
LAW WHEN IT REJECTED PETITIONERS CLAIM TO SECURITY OF
TENURE.
IV
THE COURT OF APPEALS COMMITTED A SERIOUS AND GRAVE ERROR IN
LAW WHEN IT DISMISSED THE PETITION FOR QUO WARRANTO FILED
BY PETITIONER.

Likewise, she cannot complain that her removal was not for cause provided by law.
The phrase for cause provided for law is a guarantee of both procedural and
substantive due process. This right proceeds from ones entitlement to security of
tenure which herein petitioner does not have due to her ineligibility for the position
concerned.

As the Supreme Court held in Achacoso (infra), [I]t is settled that a permanent
appointment can be issued only to a person who meets all the requirements for the
position to which he is being appointed, including the appropriate eligibility
prescribed. Achacoso did not. At best, therefore, his appointment could be regarded
only as temporary. And being so, it could be withdrawn at will by the appointing
authority and at a moments notice, conformably to established jurisprudence.

The statutory backbone of petitioners arguments is Memorandum Circular No. 21


dated May 31, 1994 issued by the Civil Service Commission (CSC). The circular
states:

THE COURT OF APPEALS COMMITTED A SERIOUS AND GRAVE ERROR IN


LAW WHEN IT FAILED TO AWARD PETITIONER MORAL DAMAGES,
EXEMPLARY DAMAGES, ATTORNEYS FEES AND LITIGATION EXPENSES.

TO: ALL HEADS OF DEPARTMENTS, BUREAUS, AND AGENCIES OF THE


NATIONAL AND LOCAL GOVERNMENT INCLUDING GOVERNMENT

28

OWNED AND CONTROLLED CORPORATIONS AND STATE COLLEGES AND


UNIVERSITIES

4. Contractual personnel or those whose employment in the government is in


accordance with a special contract to undertake a specific work or job, and,

SUBJECT: Coverage of the Career Executive Service


5. Emergency and seasonal personnel.
Pursuant to CSC Resolution No. 94-2925 dated May 31, 1994, the Commission
adopts the following guidelines on the coverage of the Career Executive Service:
1. Positions Covered by the Career Executive Service.
(a) The Career Executive Service includes the positions of Undersecretary, Assistant
Secretary, Bureau Director, Assistant Bureau Director, Regional Director
(department-wide and bureau-wide), Assistant Regional Director (department-wide
and bureau-wide) and Chief of Department Service.
(b) In addition to the above identified position and other positions of the same
category which had been previously classified and included in the CES, all other
third level positions in all branches and instrumentalities of the national government,
including government-owned or controlled corporations with original charters are
embraced within the Career Executive Service provided that they meet the following
criteria:
1. the position is a career position;
2. the position is above division chief level;
3. the duties and responsibilities of the position require the performance of executive
or managerial functions.
2. Positions Excluded from the Career Executive Service.
(a) Supervisory and executive positions which have fixed terms of office as provided
for in the charter of the agency or as specified by law;

(c) Supervisory and executive positions in the national government belonging to the
closed career systems which are administered by special bodies such as the Foreign
Service, Philippine National Police, State Colleges and Universities unless otherwise
provided in their respective charters, the Scientific Career Service and the like.
3. Position of Head Executive Assistant. The position of Head Executive Assistant,
whether in departments, agencies, branches or instrumentalities of the national
government, including Government-Owned or Controlled Corporations with the
original charters shall not be within the coverage of the Career Executive Service.
4. Status of Appointment of Incumbents of Positions Included Under the Coverage of
the CES. Incumbents of positions which are declared to be Career Executive Service
positions for the first time pursuant to this Resolution who hold permanent
appointments thereto shall remain under permanent status in their respective
positions. However, upon promotion or transfer to other Career Executive Service
(CES) positions, these incumbents shall be under temporary status in said other CES
positions until they qualify. (italics supplied)
5. Exemption from the Coverage in the Career Executive Service of Agencies. An
agency may request the Commission that a position be declared a non-CES position
if the head of the agency believes that said positions does not properly belong in the
Career Executive Service. A request for exemption should be filed with the Career
Executive Service Office of the Civil Service commission accompanied by
appropriate justifications. Upon receipt of such request, the Commission shall issue a
decision on the matter within a reasonable time.

(b) Supervisory and executive positions in the non-career service which include the
following:

6. Positions in Local Government Units. Third level positions in local government


units (municipal corporations) or similar entities including those devolved from the
National Government are, for the meantime, excluded from the coverage of the
Career Executive Service.

1. Elective officials and their personal or confidential staff;

This Memorandum Circular takes effect immediately.

2. Secretaries and other officials of cabinet rank who hold their positions at the
pleasure of the President and their personal or confidential staff;

Section 4 of CSC Memorandum Circular No. 21 upon which petitioner relies makes
particular reference to incumbents of positions which are declared to be part of the
Career Executive Service for the first time pursuant to this resolution who hold
permanent appointments thereto. The position which petitioner held, however, was
classified as part of the career executive service a year earlier, on June 4, 1993, the

3. Chairman and members of commission and boards with fixed terms of office and
their personal or confidential staff;

29

legal basis therefor being Presidential Decree No. 1 dated September 24, 1972,[12]
adopting the Integrated Reorganization Plan as part of the law of the land. Upon
closer scrutiny, section 4 appears to contradict the principle which we laid down in
Achacoso v. Macaraig, [13] three (3) years prior to the issuance of the circular, to
wit:
It is settled that a permanent appointment can be issued only to a person who meets
all the requirements for the position to which he is being appointed, including the
appropriate eligibility prescribed. Achacoso did not. At best, therefore, his
appointment could be withdrawn at will by the appointing authority and at a
moments notice, conformably to established jurisprudence.
xxx xxx xxx
The mere fact that a position belongs to the Career Service does not automatically
confer security of tenure on its occupant even if he does not possess the required
qualifications. Such right will have to depend on the nature of his appointment,
which in turn depends on his eligibility or lack of it. A person who does not have the
requisite qualifications for the position cannot be appointed to it in the first place or,
only as an exception to the rule, may be appointed to it merely in an acting capacity
in the absence of appropriate eligibles. The appointment extended to him cannot be
regarded as permanent even if it may be so designated.
It is useful to note that Achacoso served as the jurisprudential basis in recent cases
involving issue of security of tenure in career executive service positions. In the
doctrinal case of Cuevas v. Bacal,[14] the object of controversy was the title of Chief
Public Attorney in the Public Attorneys Office, which requires a CES Rank Level 1.
The claimant, respondent Atty. Josefina Bacal, who possessed a CESO III rank, was
appointed as such in February 1998 by then President Fidel V. Ramos. In July 1998,
she was transferred and appointed Regional Director. Designated in her stead by
former President Joseph E. Estrada as Chief Public Defender was Atty. Carina J.
Demaisip. As Demaisip was not a CES eligible, Bacal filed a quo warranto suit
before the Court of Appeals questioning the formers appointment. The Court of
Appeals rendered judgment in Bacals favor which, however, we reversed.
In that case of Bacal this Court emphasized two (2) salient points, to wit:
First, in order to qualify an appointment as permanent, the appointee must possess
the rank appropriate to the position. Failure in this respect will render the
appointment merely temporary. In Atty. Bacals case, it was ruled that she did not
acquire tenure since she had only a CESO III rank; and that she was not appointed
CESO I which was the requisite eligibility for the position of Chief Public Attorney.

Second, security of tenure in the career executive service (CES) is thus acquired with
respect to rank, and not to position. The guaranty of security of tenure to members of
the career executive service does not extend to the particular positions to which they
may be appointed a concept which is applicable only to first and second-level
employees in the civil service but to the rank to which they are appointed by the
President.
We reiterate those points here if only to serve as a contradistinction to petitioners
arguments. If a career executive officers security of tenure pertains only to his rank
and not to his position, with greater reason then that petitioner herein, who is not
even a CESO eligible, has no security of tenure with regard to the position of
Executive Director II of the Toll Regulatory Board which was earlier classified on
June 4, 1993 as part of the career executive service or prior to the issuance of CSC
Memorandum Circular No. 21 dated May 31, 1994.
Our ruling in the fairly recent case of De Leon v. Court of Appeals[15] is more
appropriate and applicable to the case at bar. The private respondent therein, like
herein petitioner Dimayuga, was not a career executive service officer, yet he was
issued a permanent appointment as Department Legal Counsel which is a career
executive service position. A dispute arose when the private respondent therein was
reassigned as Director III (Assistant Regional Director) of Region IX. We
subsequently rendered judgment in that case of De Leon finding that the therein
private respondents security of tenure was not violated. In sustaining his
reassignment, we held that:
The mere fact that a position belongs to the Career Service does not automatically
confer security of tenure on its occupant even if he does not possess the required
qualifications. Such right will have to depend on the nature of his appointment,
which in turn depends on his eligibility or lack of it. A person who does not have the
requisite qualifications for the position cannot be appointed to it in the first place or,
only as an exception to the rule, may be appointed to it merely in an acting capacity
in the absence of appropriate eligibles. The appointment extended to him cannot be
regarded as permanent even if it may be so designated.
Evidently, private respondents appointment did not attain permanency. Not having
taken the necessary Career Executive Service Examination to obtain the requisite
eligibility, he did not at the time of his appointment and up to the present, possess the
needed eligibility for a position in the Career Executive Service. Consequently, his
appointment as Ministry Legal Counsel CESO IV/Department Legal Counsel and/or
Director III, was merely temporary. Such being the case, he could be transferred or
reassigned without violating the constitutionally guaranteed right to security of
tenure.

30

Private respondent capitalizes on his lack of CES eligibility by adamantly contending


that the mobility and flexibility concepts in the assignment of personnel under the
Career Executive Service do not apply to him because he is not a Career Executive
Service Officer. Obviously, the contention is without merit. As correctly pointed out
by the Solicitor General, non-eligibles holding permanent appointments to CES
positions were never meant to remain immobile in their status. Otherwise, their lack
of eligibility would be a premium vesting them with permanency in the CES
positions, a privilege even their eligible counterparts do not enjoy.
Then too, the cases on unconsented transfer invoked by private respondent find no
application in the present case. To reiterate, private respondents appointment is
merely temporary; hence, he could be transferred or reassigned to other positions
without violating his right to security of tenure.
[G.R. No. L-3521. December 13, 1949.]
THE NACIONALISTA PARTY ET AL., Petitioners, v. THE COMMISSION ON
ELECTIONS, Respondent.
Claro M. Recto, Manuel C. Briones, Jesus G. Barrera, J. Antonio Araneta and Jesus
P. Morfe, for Petitioners.
Vicente de Vera, Leopoldo Rovira and Rodrigo D. Perez Jr. for Respondent.
SYLLABUS
1. COMMISSION ON ELECTIONS; NOT AUTHORIZED TO ANNUL
ELECTIONS. The power vested by the Constitution in the Commission on
Elections to enforce and administer all laws relative to the conduct of elections and
to insure free, orderly, honest elections does not include the power to annul an
election which may not have been free, orderly, and honest. Such power is
preventive only and not curative also; it is intended to prevent any and all forms of
election fraud or violation of the Election Law, but it is fails to accomplish that
purpose, it is not the Commission on Elections that is charged with the duty to cure
or remedy the resulting evil but some other agencies of the Government.
2. ID.; ID.; SENATE ELECTORAL TRIBUNAL. Frauds or other irregularities
alleged to have been admitted in the election of senators involve a senatorial election
contest over which the Electoral Tribunal of the Senate, and neither the Commission
on Elections not the Supreme Court, has jurisdiction in accordance with section 11 of
Article VI of the Constitution.

In the light of the foregoing premises, the Civil Service Commissions opinion as
embodied in its reply letter to petitioner dated December 15, 1998 sustaining
petitioners alleged permanent appointment as Executive Director of the Toll
Regulatory Board on the basis of section 4 of Memorandum Circular No. 21 loses
persuasion and applicability to the case at bar. Petitioner is not a CESO eligible. In
other words, her instant petition is devoid of merit.
WHEREFORE, the instant petition is hereby DENIED for lack of merit. The
Decision dated July 25, 2000 rendered by the former Seventeenth Division of the
Court of Appeals in CA-G.R. SP No. 54733 is AFFIRMED. Costs against petitioner.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Quisumbing, and Buena, JJ., concur.
board of canvasser with respect to the election of senators. Such a board is a
ministerial body empowered only to accept as correct returns transmitted to it which
are in due from and to ascertain and declare the result as it appears therefrom.
Questions of illegal voting. However, it must satisfy itself of the genuineness of the
returns. Where the returns are obviously manufactured, as where they show a great
excess of votes over what could legally have been cast, the board will not be
compelled to canvass them.
4. SUPREME COURT; EXTENT OF ITS POWER TO REDRESS GRIEVANCES,
CIRCUMSCRIBED BY LAW. Anent petitioners plea to vindicate the peoples
right freely and honestly to elect their officers, alleged to have been violated by the
party in power, and thereby preserve democracy in this country, the Court says: "We
are not unmindful of the grave political situation nor are we insensitive to
petitioners vehement plea for redress. At the same time, it must ever be borne in
mind that we are not omnipotent; our powers and jurisdiction are circumscribed by
law, which we cannot transcend. We cannot correct an alleged abuse of power on the
part of others by means of a similar abuse of our powers; we cannot and must not
assume the role of a dictator to forestall dictatorship; we cannot transcend the law to
foster the reign of law. Our duty is to dispense justice under the law. We can only
perform faithfully our assigned duty and expect others to perform theirs.
Constitutional government can be preserved and maintained if every officer, who has
sworn to preserved and defend the Constitution, keeps his solemn oath faithfully."
DECISION
OZAETA, J.:

3. ID.; AUTHORITY AS NATIONAL BOARD OF CANVASSERS. Section 166


of the Revised Election Code constitute the commission on Elections as a national

31

This is a petition for mandamus to compel the Commission on Elections to exclude


(not to count) the votes cast for senators in the provinces of Negros Occidental and
Lanao during the last elections in the canvass to be performed by it pursuant to
section 166 of the Revised Election Code. After due hearing on December 9, 1949,
we denied the petition. This opinion is handed down to expound our decision.
The allegations of the petition which are admitted in respondents answer are in
substance as follows:chanrob1es virtual 1aw library
The petitioner Nacionalista Party is a national political party with official candidates
for all the offices involved in the last national elections, and the other petitioners are
the eight candidates for senators of said party. The respondent Commission on
Elections is an entity created by the Constitution and charged with the duty of
enforcing and administering all laws relative to the conduct of elections, with the
power to take proper measures to insure free, orderly, and honest elections
throughout the Philippines.
Several weeks before the holding of the last national elections, some of the
petitioners made representations to the respondent that in view of the state of
terrorism and political persecutions existing in the provinces of Negros Occidental
and Lanao against the persons of the candidates, leaders, and sympathizers of the
petitioners, intended to prevent the free expression of the voters will in the national
elections scheduled for November 8, 1949, and considering the rampant violation of
the Election Law which were committed in said provinces to the prejudice of the
petitioners during the two registration days, consisting among others of the padding
of the electoral census in many of the municipal districts of Lanao, it had become
impossible to hold free, orderly, and honest elections in said provinces.
In view of said representations the respondent Commission, after considering the
evidence presented before it, approved a resolution on November 4, 1949, wherein it
found in substance (1) that in Negros Occidental the provincial governor, who was
the political leader in that province of one of the political parties (the Liberal Party),
organized and fully armed special agents, some of whom were irresponsible minors
with no training in discipline; that said agents, who owed loyalty to the provincial
governor and followed blindly the latters orders, arrested without warrants of arrest,
threatened, intimidated, and assaulted the political leaders and followers of the
opposition; that in some places the registration of the voters was made without the
presence of the opposition inspectors because of such intimidation; that candidates
and political leaders of the opposition had to evacuate to Iloilo, Manila, and other
places for security reasons; that under the tense political situation in the province, the
armed special agents headed by the provincial governor had full control of the
election in said province; and that in the light of these facts the Commission believed
that a clean, orderly, and honest election could not be held in the province of Negros
Occidental; and (2) that in the province of Lanao, wholesale frauds were committed

in the 1947 election consisting in the registration in various municipal districts of


thousands of fictitious voters; that in some municipal districts the number of
registered electors even exceeded the number of inhabitants; that what happened in
the 1947 election in Lanao was bound to be repeated in the 1949 election, in view of
the fact that the election precincts where there was fraudulent registration of voters
were situated in distant places, the great majority of them in jungles without any
means of communication and beyond the supervision of the representatives of the
Commission on Elections. Upon these findings the Commission recommended to the
President of the Philippines the postponement of the election in the entire province of
Negros Occidental and in various specified municipal districts of Lanao.
The President chose not to follow said recommendation, and did not suspend the
elections in the two provinces in question.
Petitioners further allege, but respondent denies, that the rampant terrorism and
irregularities mentioned in the resolution and recommendation of the Commission on
Elections "continued to exist during the last election according to reports duly
submitted before the respondent Commission on Elections" ; that, consequently, the
elections held in the provinces of Lanao and Negros Occidental are null and void;
and that therefore the votes cast therein should not be counted.
During the hearing of this case we were informed by counsel for the respondent that
the petitioners had presented before the Commission on Elections a petition, which
that body had not yet resolved, seeking the annulment, or exclusion from the
canvass, of the votes cast for senators not only in the provinces of Negros Occidental
and Lanao but also in five other provinces where, it is alleged, there had been no
free, orderly, and honest elections.
As the court of last resort we are now called upon to define and delimit the powers of
the Commission on Elections under the Constitution and the Election Law.
Specifically, the question to decide is whether the Commission on Elections is
empowered to annul an election in any political division or subdivision because of
alleged terrorism or fraud committed in connection therewith.
During the oral argument counsel for the petitioners sought to impress upon us the
grave political crisis with which the nation is now confronted as a result of the last
elections, during which, it is denounced, the sovereign right of the people freely and
honestly to elect their officers was not respected but brazenly violated in several
provinces by the party in power; and that this Tribunal, as the bulwark of the
peoples right, is in duty bound to vindicate it and preserve democracy in this
country. We are not unmindful of the grave political situation, nor are we insensitive
to petitioners vehement plea for redress. At the same time, it must ever be borne in
mind that we are not omnipotent; our powers and jurisdiction are circumscribed by
law, which we cannot transcend. We cannot correct an alleged abuse of power on the

32

part of others by means of a similar abuse of our own powers; we cannot and must
not assume the role of a dictator to forestall dictatorship; we cannot transcend the
law to foster the reign of law. Our duty is to dispense justice under the law. We can
only perform faithfully our assigned duty and expect others to perform theirs.
Constitutional government can be preserved and maintained if every officer, who has
sworn to preserve and defend the Constitution, keeps his solemn oath faithfully.
It is in that consciousness that we now proceed to resolve the question involved in
this case.
Section 2 of Article X of the Constitution provides:jgc:chanrobles.com.ph
"The Commission on Elections shall have exclusive charge of the enforcement and
administration of all laws relative to the conduct of elections and shall exercise all
other functions which may be conferred upon it by law. It shall decide, save those
involving the right to vote, all administrative questions, affecting elections, including
the determination of the number and location of polling places, and the appointment
of election inspectors and other election officials. All law-enforcement agencies and
instrumentalities of the Government, when so required by the Commission, shall act
as its deputies for the purpose of insuring free, orderly, and honest elections. The
decisions, orders, and rulings of the Commission shall be subject to review by the
Supreme Court."cralaw virtua1aw library
Supplementing and in a way implementing that constitutional provision are, in so far
as pertinent here, sections 8 and 166 of the Revised Election Code, which read as
follows:jgc:chanrobles.com.ph
"SEC. 8. Postponement of election. When for any serious cause the holding of an
election should become impossible in any political division or subdivision, the
President, upon recommendation of the Commission on Elections, shall postpone the
election therein for such time as he may deem necessary.
"SEC. 166. Canvass of votes for President, Vice President and Senators. Thirty
days after the elections have been held, the Commission on Elections shall meet in
session and shall publicly count the votes cast for Senators. The registered candidates
in the number of Senators required to be elected who obtained the highest number of
votes shall be declared elected. A copy of such statement shall be furnished to the
Secretary of the Senate and to each elected candidate."cralaw virtua1aw library
Germane to the above constitutional and statutory provisions is section 11 of Article
VI of the Constitution, which reads as follows:jgc:chanrobles.com.ph
"SEC. 11. The Senate and the House of Representatives shall each have an Electoral
Tribunal which shall be the sole judge of all contests relating to the election, returns,

and qualifications of their respective Members. Each Electoral Tribunal shall be


composed of nine Members, three of whom shall be Justices of the Supreme Court to
be designated by the Chief Justice, and the remaining six shall be Members of the
Senate or of the House of Representatives, as the case may be, who shall be chosen
by each House, three upon nomination of the party having the largest number of
votes and three of the party having the second largest number of votes therein. The
senior Justice in each Electoral Tribunal shall be its Chairman."cralaw virtua1aw
library
What are the implications of the power vested in the Commission to enforce and
administer all laws relative to the conduct of elections and to insure free, orderly, and
honest elections? Does it include the power to annul an election which may not have
been free, orderly, and honest?
It seems clear from the context of the constitutional provision in question as well as
from other provisions already quoted above that such power is preventive only and
not curative also; that is to say, it is intended to prevent any and all forms of election
fraud or violation of the Election Law, but if it fails to accomplish that purpose, it is
not the Commission on Elections that is charged with the duty to cure or remedy the
resulting evil but some other agencies of the Government. We note from the text that
the power to decide questions involving the right to vote is expressly withheld from
the Commission although the right to vote is provided in the Election Law, the
enforcement and administration of which is placed in the exclusive charge of the
Commission. Parallel to the withholding of such power from the Commission is the
vesting in other agencies of the more inclusive power to decide all contests relating
to the election, returns, and qualifications of the members of Congress, namely, the
Electoral Tribunal of the Senate in the case of the senators and the Electoral Tribunal
of the House of Representatives in the case of the members of the latter. Election
contests involving provincial and municipal officials are entrusted to the courts.
(Sections 172 et seq., Revised Election Code.) The power to decide election contests
necessarily includes the power to determine the validity or nullity of the votes
questioned by either of the contestants.
Thus, in so far as contests relating to the election of senators and representatives are
concerned, not even this court is empowered to intervene.
At bottom this case involves a senatorial election contest insofar as the petitioners
who are candidates for senators of the Nacionalista Party seek to exclude or annul
the votes cast for senators during the last elections in Negros Occidental and Lanao,
with the notorious defect that the opposing candidates have not been impleaded. At
this stage the obvious intent of the petitioners is to avoid, if possible, the necessity on
their part of filing an election protest before the Electoral Tribunal of the Senate. But
as we construe the pertinent provisions of the Constitution and of the Election Law,
neither the Commission on Elections nor this court is empowered to forestall and

33

much less decide the impending contest. The jurisdiction over such case is expressly
and exclusively vested by the Constitution in the Electoral Tribunal of the Senate.
Implementing the constitutional mandate on the subject, section 182 of the Revised
Election Code provides:jgc:chanrobles.com.ph
"In contests under their respective jurisdiction, the Electoral Tribunals of the Senate
and the House of Representatives shall have and exercise the same powers which the
law confers upon the courts, including that of summarily punishing contempts,
ordering the taking of depositions, the arrests of witnesses for the purpose of
compelling their appearances and the production of documents and other evidence,
and the compulsory payment of costs and expenses which it may have assessed
against the parties and their bondsmen; of giving notices of its decisions, resolutions,
and orders and enforcing them through the officials charged with the enforcement of
judicial orders; and of making the necessary rules for the effective performance of
their constitutional functions. All the expenses of the said Tribunals and of their
respective members shall be paid from the funds of the House of Congress to which
each Tribunal pertains, and their telegrams and correspondence shall be transmitted
free of charge."cralaw virtua1aw library
Section 166 of the Revised Election Code hereinabove quoted constitutes the
Commission on Elections as a national board of canvassers with respect to the
election of senators, who under section 2 of Article VI of the Constitution are chosen
at large by the qualified electors of the Philippines. In the absence of any provision in
the law making the members of a canvassing board judges of the election and giving
them full power and authority to approve thereof or set it aside and order a new
election, "such a board is considered to be merely a ministerial body, which is
empowered only to accept as correct returns transmitted to it, which are in due form,
and to ascertain and declare the result as it appears therefrom. Questions of illegal
voting and fraudulent practices are passed on by another tribunal. The canvassers are
to be satisfied of the genuineness of the returns namely, that the papers presented
to them are not forged and spurious, that they are returns, and that they are signed by
the proper officers. When so satisfied, however, they may not reject any returns
because of informalities in them or because of illegal and fraudulent practices in the
election. . . . Where the returns are obviously manufactured, as where they show a
great excess of votes over what could legally have been cast, the board will not be
compelled to canvass them." (18 Am. Jur., Elections, sec. 254, pp. 346-348.)
SUPREME COURT
Manila
EN BANC

It is contended for the petitioners that since the respondent Commission itself had
recommended to the President the postponement of the election in the whole
province of Negros Occidental and in certain specified municipal districts of Lanao
because it was deemed impossible to hold a free, orderly, and honest election therein,
the respondent Commission should be ordered to consider null and exclude the votes
cast for senators in the election held in said provinces.
We do not deem it proper for us to determine the legal effect of the Commissions
recommendation to the President to postpone the election in said provinces; that is to
say, whether or not it was mandatory on the President to follow said recommendation
and, in the affirmative case, whether the failure of the President to do so would
render void the election in those places. Under the Constitution, "questions of illegal
voting and fraudulent practices are passed on by another tribunal," the Electoral
Tribunal of the Senate. Such questions will in all probability be raised before said
tribunal at the proper time, and we must not prejudge an issue over which we have
no jurisdiction. Whether the votes for senators in Negros Occidental and Lanao are
valid or invalid is a question which neither the Commission on Elections nor this
court is empowered to decide.
Upon the facts and the law as above expounded, we have no authority to grant the
remedy prayed for. The writ of mandamus lies "when any tribunal, corporation,
board, or person unlawfully neglects the performance of an act which the law
specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully
excludes another from the use and enjoyment of a right or office to which such other
is entitled, and there is no other plain, speedy, and adequate remedy in the ordinary
course of law." (Section 3, Rule 67.) We have seen that it is not the duty of the
Commission on Elections to pass upon the legality of an election alleged to have
been tainted with fraud, intimidation, or other violation of the Election Law. On the
contrary, it is its ministerial duty to count the votes appearing in the election returns
after satisfying itself of the genuineness of said returns. What in effect the petitioners
seek is to require the respondent to desist from performing a ministerial duty.
The petition is denied, with costs against the petitioners.
vs.
HONORABLE ENRIQUE B. INTING, PRESIDING JUDGE, REGIONAL TRIAL
COURT, BRANCH 38, DUMAGUETE CITY, AND OIC MAYOR DOMINADOR
S. REGALADO, JR., respondents.

G.R. No. 88919 July 25, 1990


PEOPLE OF THE PHILIPPINES, petitioner,

GUTIERREZ, JR., J.:

34

Does a preliminary investigation conducted by a Provincial Election Supervisor


involving election offenses have to be coursed through the Provincial Fiscal now
Provincial Prosecutor, before the Regional Trial Court may take cognizance of the
investigation and determine whether or not probable cause exists?
On February 6, 1988, Mrs. Editha Barba filed a letter-complaint against OIC-Mayor
Dominador Regalado of Tanjay, Negros Oriental with the Commission on Elections
(COMELEC), for allegedly transferring her, a permanent Nursing Attendant, Grade
I, in the office of the Municipal Mayor to a very remote barangay and without
obtaining prior permission or clearance from COMELEC as required by law.
Acting on the complaint, COMELEC directed Atty. Gerardo Lituanas, Provincial
Election Supervisor of Dumaguete City: (1) to conduct the preliminary investigation
of the case; (2) to prepare and file the necessary information in court; (3) to handle
the prosecution if the evidence submitted shows a prima facie case and (3) to issue a
resolution of prosecution or dismissal as the case may be. The directive to conduct
the preliminary investigation was pursuant to COMELEC Resolution No. 1752 dated
January 14, 1986. The resolution, in turn, is based on the constitutional mandate that
the COMELEC is charged with the enforcement and administration of all laws
relative to the conduct of elections for the purpose of ensuring free, orderly and
honest elections (sec. 2, Article XII-C of the 1973 Constitution) and on the Omnibus
Election Code which implements the constitutional provision. The Resolution
provides, among others:
xxx xxx xxx
Further, Regional Election Directors and Provincial Election Supervisors are hereby
authorized to conduct preliminary investigations of election offenses committed in
their respective jurisdictions, file the corresponding complaints and/or informations
in court whenever warranted, and to prosecute the same pursuant to Section 265 of
the Omnibus Election Code. (Rollo, p. 15)
After a preliminary investigation of Barba's complaint, Atty. Lituanas found a prima
facie case. Hence, on September 26, 1988, he filed with the respondent trial court a
criminal case for violation of section 261, Par. (h), Omnibus Election Code against
the OIC-Mayor.
In an Order dated September 30, 1988, the respondent court issued a warrant of
arrest against the accused OIC Mayor. It also fixed the bail at five thousand pesos
(P5,000.00) as recommended by the Provincial Election Supervisor.
However, in an order dated October 3, 1988 and before the accused could be
arrested, the trial court set aside its September 30, 1988 order on the ground that

Atty. Lituanas is not authorized to determine probable cause pursuant to Section 2,


Article III of the 1987 Constitution. The court stated that it "will give due course to
the information filed in this case if the same has the written approval of the
Provincial Fiscal after which the prosecution of the case shall be under the
supervision and control of the latter." (at p. 23, Rollo, emphasis supplied)
In another order dated November 22, 1988, the court gave Atty. Lituanas fifteen (15)
days from receipt to file another information charging the same offense with the
written approval of the Provincial Fiscal.
Atty. Lituanas failed to comply with the order. Hence, in an order dated December 8,
1988, the trial court quashed the information. A motion for reconsideration was
denied.
Hence, this petition.
The respondent trial court justifies its stand on the ground that the COMELEC
through its Provincial Election Supervisor lacks jurisdiction to determine the
existence of probable cause in an election offense which it seeks to prosecute in court
because:
While under Section 265 of the Omnibus Election Code approved on December 3,
1985 duly authorized legal officers of the Commission on Elections have the
exclusive power to conduct preliminary investigation of all election offenses and to
prosecute the same, it is doubtful whether said authority under the auspices of the
1973 Constitution, still subsists under the 1987 Constitution which has deleted in its
Section 2, Article III, the phrase "and such other responsible officer as may be
authorized by law" in the equivalent section and article of the 1973 Constitution.
(Rollo, p. 24)
The petition is impressed with merit.
We emphasize important features of the constitutional mandate that " ... no search
warrant or warrant of arrest shall issue except upon probable cause to be determined
personally by the judge ... " (Article III, Section 2, Constitution)
First, the determination of probable cause is a function of the Judge. It is not for the
Provincial Fiscal or Prosecutor nor for the Election Supervisor to ascertain. Only the
Judge and the Judge alone makes this determination.
Second, the preliminary inquiry made by a Prosecutor does not bind the Judge. It
merely assists him to make the determination of probable cause. The Judge does not
have to follow what the Prosecutor presents to him. By itself, the Prosecutor's
certification of probable cause is ineffectual. It is the report, the affidavits, the

35

transcripts of stenographic notes (if any), and all other supporting documents behind
the Prosecutor's certification which are material in assisting the Judge to make his
determination.
And third, Judges and Prosecutors alike should distinguish the preliminary inquiry
which determines probable cause for the issuance of a warrant of arrest from the
preliminary investigation proper which ascertains whether the offender should be
held for trial or released. Even if the two inquiries are conducted in the course of one
and the same proceeding, there should be no confusion about the objectives. The
determination of probable cause for the warrant of arrest is made by the Judge. The
preliminary investigation proper-whether or not there is reasonable ground to believe
that the accused is guilty of the offense charged and, therefore, whether or not he
should be subjected to the expense, rigors and embarrassment of trial is the function
of the Prosecutor.
The Court made this clear in the case of Castillo v. Villaluz (171 SCRA 39 [1989]):
Judges of Regional Trial Courts (formerly Courts of First Instance) no longer have
authority to conduct preliminary investigations. That authority, at one time reposed
in them under Sections 13, 14 and 16 Rule 112 of the Rules of Court of 1964, (See
Sec. 4, Rule 108, Rules of Court of 1940; People v. Solon, 47 Phil. 443, cited in
Moran, Comments on the Rules, 1980 ed., Vol. 4, pp. 115-116) was removed from
them by the 1985 Rules on Criminal Procedure, effective on January 1, 1985,
(Promulgated on November 11, 1984) which deleted all provisions granting that
power to said Judges. We had occasion to point this out in Salta v. Court of Appeals,
143 SCRA 228, and to stress as well certain other basic propositions, namely: (1)
that the conduct of a preliminary investigation is "not a judicial function ... (but) part
of the prosecution's job, a function of the executive," (2) that wherever "there are
enough fiscals or prosecutors to conduct preliminary investigations, courts are
counseled to leave this job which is essentially executive to them," and the fact "that
a certain power is granted does not necessarily mean that it should be
indiscriminately exercised."
The 1988 Amendments to the 1985 Rules on Criminal Procedure, declared effective
on October 1, 1988, (The 1988 Amendments were published in the issue of Bulletin
Today of October 29, 1988) did not restore that authority to Judges of Regional Trial
Courts; said amendments did not in fact deal at all with the officers or courts having
authority to conduct preliminary investigations.
This is not to say, however, that somewhere along the line RTC Judges also lost the
power to make a preliminary examination for the purpose of determining whether
probable cause exists to justify the issuance of a warrant of arrest (or search warrant).
Such a power indeed, it is as much a duty as it is a power has been and remains
vested in every judge by the provision in the Bill of Rights in the 1935, the 1973 and

the present (1987) Constitutions securing the people against unreasonable searches
and seizures, thereby placing it beyond the competence of mere Court rule or statute
to revoke. The distinction must, therefore, be made clear while an RTC Judge may
no longer conduct preliminary investigations to ascertain whether there is sufficient
ground for the filing of a criminal complaint or information, he retains the authority,
when such a pleading is filed with his court, to determine whether there is probable
cause justifying the issuance of a warrant of arrest. It might be added that this
distinction accords, rather than conflicts, with the rationale of Salta because both law
and rule, in restricting to judges the authority to order arrest, recognize that function
to be judicial in nature.
We reiterate that preliminary investigation should be distinguished as to whether it is
an investigation for the determination of a sufficient ground for the filing of the
information or it is an investigation for the determination of a probable cause for the
issuance of a warrant of arrest. The first kind of preliminary investigation is
executive in nature. It is part of the prosecution's job. The second kind of preliminary
investigation which is more properly called preliminary examination is judicial in
nature and is lodged with the judge. It is in this context that we address the issue
raised in the instant petition so as to give meaning to the constitutional power vested
in the COMELEC regarding election offenses.
Article IX C Section 2 of the Constitution provides:
Sec. 2. The Commission on Elections shall exercise the following powers and
functions
(1) Enforce and administer all laws and regulations relative to the conduct of an
election, plebiscite, initiative, referendum, and recall.
xxx xxx xxx
(6) File, upon a verified complaint, or on its own initiative, petitions in court for
inclusion or exclusion of votes, investigate and, where appropriate, prosecute cases
of violation of election laws, including acts or omission constituting election frauds,
offenses, and practices. (Emphasis supplied)
In effect the 1987 Constitution mandates the COMELEC not only to investigate but
also to prosecute cases of violation of election laws. This means that the COMELEC
is empowered to conduct preliminary investigations in cases involving election
offenses for the purpose of helping the Judge determine probable cause and for filing
an information in court. This power is exclusive with COMELEC.
The grant to the COMELEC of the power, among others, to enforce and administer
all laws relative to the conduct of election and the concomittant authority to

36

investigate and prosecute election offenses is not without compelling reason. The
evident constitutional intendment in bestowing this power to the COMELEC is to
insure the free, orderly and honest conduct of elections, failure of which would result
in the frustration of the true will of the people and make a mere idle ceremony of the
sacred right and duty of every qualified citizen to vote. To divest the COMELEC of
the authority to investigate and prosecute offenses committed by public officials in
relation to their office would thus seriously impair its effectiveness in achieving this
clear constitutional mandate.

punishable as provided for in the preceding section, and to prosecute the same:
Provided, That in the event that the Commission fails to act on any complaint within
two (2) months from filing, the complainant may file the complaint with the Office
of the Fiscal or with the Department of Justice for proper investigation and
prosecution, if warranted.

From a careful scrutiny of the constitutional provisions relied upon by the


Sandiganbayan, We perceived neither explicit nor implicit grant to it and its
prosecuting arm, the Tanodbayan, of the authority to investigate, prosecute and hear
election offenses committed by public officers in relation to their office as
contradistinguished from the clear and categorical bestowal of said authority and
jurisdiction upon the COMELEC and the courts of first instance under Sections 182
and 184, respectively, of the Election Code of 1978.

It is only after a preliminary examination conducted by the COMELEC through its


officials or its deputies that section 2, Article III of the 1987 Constitution comes in.
This is so, because, when the application for a warrant of arrest is made and the
information is filed with the court, the judge will then determine whether or not a
probable cause exists for the issuance of a warrant of arrest.

An examination of the provisions of the Constitution and the Election Code of 1978
reveals the clear intention to place in the COMELEC exclusive jurisdiction to
investigate and prosecute election offenses committed by any person, whether
private individual or public officer or employee, and in the latter instance,
irrespective of whether the offense is committed in relation to his official duties or
not. In other words, it is the nature of the offense and not the personality of the
offender that matters. As long as the offense is an election offense jurisdiction over
the same rests exclusively with the COMELEC, in view of its all-embracing power
over the conduct of elections. (Corpus v. Tanodbayan, 149 SCRA 281 [1987])
Hence, the Provincial Fiscal, as such, assumes no role in the prosecution of election
offenses. If the Fiscal or Prosecutor files an information charging an election offense
or prosecutes a violation of election law, it is because he has been deputized by the
COMELEC. He does not do so under the sole authority of his office. (People v.
Basilla, et al., G.R. Nos. 83938-40, November 6, 1989).itc-asl In the instant case,
there is no averment or allegation that the respondent Judge is bringing in the
Provincial Fiscal as a deputy of COMELEC. He wants the Fiscal to "approve" the
COMELEC's preliminary investigation.
It is to be noted that on February 27, 1987 (when the 1987 Constitution was already
in effect) the President issued Executive Order No. 134 which was the ENABLING
ACT FOR ELECTIONS FOR MEMBERS OF CONGRESS ON MAY 11, 1987
AND FOR OTHER PURPOSES." Section 11 thereof provides:
Prosecution. The Commission shall, through its duly authorized legal officers, have
exclusive power to conduct preliminary investigation of all election offenses
Republic of the Philippines

The Commission may avail of the assistance of other prosecuting arms of the
government.

Bearing these principles in mind, it is apparant that the respondent trial court
misconstrued the constitutional provision when it quashed the information filed by
the Provincial Election Supervisor. As indicated above what the respondent trial
court should have done was to enforce its September 30, 1988 order, to wit:
Pursuant to Circular No. 12 of the Chief Justice of the Supreme Court dated June 30,
1987 and considering that after a personal examination of the evidence submitted by
the investigating Provincial Election Supervisor III Negros Oriental (Designated
Legal Officer), there is reasonable ground for this Court to rely on the certification of
said Provincial Election Supervisor III in the information that a probable cause
exists, let a warrant issue for the arrest of the accused filing the bail at FIVE
THOUSAND (P5,000.00) PESOS as recommended by the Provincial Election
Supervisor III.
The order to get the approval of the Provincial Fiscal is not only superfluous but
unwarranted.
WHEREFORE, the instant petition is GRANTED. The questioned Orders dated
October 3, 1988, November 22, 1988 and December 8, 1988 are REVERSED and
SET ASIDE. The respondent trial court's Order dated September 30, 1988 is
REINSTATED. The respondent court is ordered to proceed hearing the case with
deliberate speed until its termination.
SO ORDERED.
Fernan, C.J., Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco, Padilla,
Bidin, Sarmiento, Cortes, Grio-Aquino, Medialdea and Regalado JJ., concur.
SUPREME COURT

37

Manila

In the three (3) consolidated Petitions before us, the common question raised by
petitioners is the constitutionality of Section 11 (b) of Republic Act No. 6646.

EN BANC
G.R. No. 102653 March 5, 1992
NATIONAL PRESS CLUB, petitioner,
vs.
COMMISSION ON ELECTIONS, respondent.
G.R. No. 102925 March 5, 1992
PHILIPPINE PRESS INSTITUTE represented by ZOILO DEJARESCO, JR., as its
Past Chairman and President, and FRAULIN A. PEASALES as its Corporate
Secretary, petitioners,
vs.
COMMISSION ON ELECTIONS, represented by HON. CHRISTIAN MONSOD,
its Chairman; HON. GUILLERMO CARAGUE and HON. ROSALINA S.
CAJUCOM, respondents.
G.R. No. 102983 March 5, 1992
KAPISANAN NG MGA BRODKASTERS SA PILIPINAS; MAKATI
BROADCASTING NETWORK; MOLAVE BROADCASTING NETWORK;
MASBATE COMMUNITY BROADCASTING CO., INC., RADIO MINDANAO
NETWORK, INC.; ABS-CBN BROADCASTING CORP.; FILIPINAS
BROADCASTING; RADIO PILIPINO CORP.; RADIO PHILIPPINES
NETWORK, INC.; EAGLE BROADCASTING CORP.; MAGILIW COMMUNITY
BROADCASTING CO., INC.; for themselves and in behalf of the mass media
owners as a class; ANDRE S. KHAN; ARCADIO M. CARANDANG, JR.; MALOU
ESPINOSA MANALASTAS; MIGUEL C. ENRIQUEZ; JOSE ANTONIO K.
VELOSO; DIANA G. DE GUZMAN; JOSE E. ESCANER, JR.; RAY G.
PEDROCHE; PETER A. LAGUSAY; ROBERT ESTRELLA; ROLANDO
RAMIREZ; for themselves as voters and in behalf of the Philippine electorate as a
class; ORLANDO S. MERCADO and ALEJANDRO de G. RODRIGUEZ; for
themselves as prospective candidates and in behalf of all candidates in the May 1992
election as a class, petitioners,
vs.
COMMISSION ON ELECTIONS, respondent.

FELICIANO, J.:

Petitioners in these cases consist of representatives of the mass media which are
prevented from selling or donating space and time for political advertisements; two
(2) individuals who are candidates for office (one for national and the other for
provincial office) in the coming May 1992 elections; and taxpayers and voters who
claim that their right to be informed of election issues and of credentials of the
candidates is being curtailed.
It is principally argued by petitioners that Section 11 (b) of Republic Act No. 6646
invades and violates the constitutional guarantees comprising freedom of expression.
Petitioners maintain that the prohibition imposed by Section 11 (b) amounts to
censorship, because it selects and singles out for suppression and repression with
criminal sanctions, only publications of a particular content, namely, media-based
election or political propaganda during the election period of 1992. It is asserted that
the prohibition is in derogation of media's role, function and duty to provide
adequate channels of public information and public opinion relevant to election
issues. Further, petitioners contend that Section 11 (b) abridges the freedom of
speech of candidates, and that the suppression of media-based campaign or political
propaganda except those appearing in the Comelec space of the newspapers and on
Comelec time of radio and television broadcasts, would bring about a substantial
reduction in the quantity or volume of information concerning candidates and issues
in the election thereby curtailing and limiting the right of voters to information and
opinion.
The statutory text that petitioners ask us to strike down as unconstitutional is that of
Section 11 (b) of Republic Act No. 6646, known as the Electoral Reforms Law of
1987:
Sec. 11 Prohibited Forms of Election Propaganda. In addition to the forms of
election propaganda prohibited under Section 85 of Batas Pambansa Blg. 881, it
shall be unlawful;
xxx xxx xxx
b) for any newspapers, radio broadcasting or television station, other mass media, or
any person making use of the mass media to sell or to give free of charge print space
or air time for campaign or other political purposes except to the Commission as
provided under Sections 90 and 92 of Batas Pambansa Blg. 881. Any mass media
columnist, commentator, announcer or personality who is a candidate for any
elective public office shall take a leave of absence from his work as such during the
campaign period. (Emphasis supplied)

38

Section 11 (b) of Republic Act No. 6646 should be taken together with Sections 90
and 92 of B.P. Blg. 881, known as the Omnibus Election Code of the Philippines,
which provide respectively as follows:
Sec. 90. Comelec space. The Commission shall procure space in at least one
newspaper of general circulation in every province or city: Provided, however, That
in the absence of said newspaper, publication shall be done in any other magazine or
periodical in said province or city, which shall be known as "Comelec Space"
wherein candidates can announce their candidacy. Said space shall be allocated, free
of charge, equally and impartially by the Commission among all candidates within
the area in which the newspaper is circulated.
xxx xxx xxx
Sec. 92. Comelec time. The Commission shall procure radio and television time
to be known as "Comelec Time" which shall be allocated equally and impartially
among the candidates within the area of coverage of all radio and television stations.
For this purpose, the franchise of all radio broadcasting and television stations are
hereby amended so as to provide radio or television time, free of charge, during the
period of the campaign. (Emphasis supplied)
The objective which animates Section 11 (b) is the equalizing, as far as practicable,
the situations of rich and poor candidates by preventing the former from enjoying the
undue advantage offered by huge campaign "war chests." Section 11 (b) prohibits the
sale or donation of print space and air time "for campaign or other political purposes"
except to the Commission on Elections ("Comelec"). Upon the other hand, Sections
90 and 92 of the Omnibus Election Code require the Comelec to procure "Comelec
space" in newspapers of general circulation in every province or city and "Comelec
time" on radio and television stations. Further, the Comelec is statutorily commanded
to allocate "Comelec space" and "Comelec time" on a free of charge, equal and
impartial basis among all candidates within the area served by the newspaper or
radio and television station involved.
No one seriously disputes the legitimacy or the importance of the objective sought to
be secured by Section 11 (b) (of Republic Act No. 6646) in relation to Sections 90
and 92 (of the Omnibus Election Code). That objective is of special importance and
urgency in a country which, like ours, is characterized by extreme disparity in
income distribution between the economic elite and the rest of society, and by the
prevalence of poverty, with the bulk of our population falling below that "poverty
line." It is supremely important, however, to note that objective is not only a
concededly legitimate one; it has also been given constitutional status by the terms of
Article IX(C) (4) of the 1987 Constitution which provides as follows:

Sec. 4. The Commission [on Elections] may, during the election period, supervise or
regulate the enjoyment or utilization of all franchises or permits for the operation of
transportation and other public utilities, media of communication or information, all
grants, special privileges, or concessions granted by the Government or any
subdivision, agency, or instrumentality thereof, including any government-owned or
controlled corporation or its subsidiary. Such supervision or regulation shall aim to
ensure equal opportunity, time, and space, and the right to reply, including
reasonable, equal rates therefor, for public information campaigns and forums among
candidates in connection with the objective of holding free, orderly, honest, peaceful,
and credible elections. (Emphasis supplied)
The Comelec has thus been expressly authorized by the Constitution to supervise or
regulate the enjoyment or utilization of the franchises or permits for the operation of
media of communication and information. The fundamental purpose of such
"supervision or regulation" has been spelled out in the Constitution as the ensuring of
"equal opportunity, time, and space, and the right to reply," as well as uniform and
reasonable rates of charges for the use of such media facilities, in connection with
"public information campaigns and forums among candidates." 1
It seems a modest proposition that the provision of the Bill of Rights which enshrines
freedom of speech, freedom of expression and freedom of the press (Article III [4],
Constitution) has to be taken in conjunction with Article IX (C) (4) which may be
seen to be a special provision applicable during a specific limited period i.e.,
"during the election period." It is difficult to overemphasize the special importance
of the rights of freedom of speech and freedom of the press in a democratic polity, in
particular when they relate to the purity and integrity of the electoral process itself,
the process by which the people identify those who shall have governance over them.
Thus, it is frequently said that these rights are accorded a preferred status in our
constitutional hierarchy. Withal, the rights of free speech and free press are not
unlimited rights for they are not the only important and relevant values even in the
most democratic of polities. In our own society, equality of opportunity to proffer
oneself for public office, without regard to the level of financial resources that one
may have at one's disposal, is clearly an important value. One of the basic state
policies given constitutional rank by Article II, Section 26 of the Constitution is the
egalitarian demand that "the State shall guarantee equal access to opportunities for
public service and prohibit political dynasties as may be defined by law." 2
The technical effect of Article IX (C) (4) of the Constitution may be seen to be that
no presumption of invalidity arises in respect of exercises of supervisory or
regulatory authority on the part of the Comelec for the purpose of securing equal
opportunity among candidates for political office, although such supervision or
regulation may result in some limitation of the rights of free speech and free press.
For supervision or regulation of the operations of media enterprises is scarcely
conceivable without such accompanying limitation. Thus, the applicable rule is the

39

general, time-honored one that a statute is presumed to be constitutional and that


the party asserting its unconstitutionality must discharge the burden of clearly and
convincingly proving that assertion. 3
Put in slightly different terms, there appears no present necessity to fall back upon
basic principles relating to the police power of the State and the requisites for
constitutionally valid exercise of that power. The essential question is whether or not
the assailed legislative or administrative provisions constitute a permissible exercise
of the power of supervision or regulation of the operations of communication and
information enterprises during an election period, or whether such act has gone
beyond permissible supervision or regulation of media operations so as to constitute
unconstitutional repression of freedom of speech and freedom of the press. The
Court considers that Section 11 (b) has not gone outside the permissible bounds of
supervision or regulation of media operations during election periods.
In the constitutional assaying of legislative provisions like Section 11 (b), the
character and extent of the limitations resulting from the particular measure being
assayed upon freedom of speech and freedom of the press are essential
considerations. It is important to note that the restrictive impact upon freedom of
speech and freedom of the press of Section 11 (b) is circumscribed by certain
important limitations.
Firstly, Section 11 (b) is limited in the duration of its applicability and enforceability.
By virtue of the operation of Article IX (C) (4) of the Constitution, Section 11 (b) is
limited in its applicability in time to election periods. By its Resolution No. 2328
dated 2 January 1992, the Comelec, acting under another specific grant of authority
by the Constitution (Article IX [C] [9]), has defined the period from 12 January 1992
until 10 June 1992 as the relevant election period.
Secondly, and more importantly, Section 11 (b) is limited in its scope of application.
Analysis of Section 11 (b) shows that it purports to apply only to the purchase and
sale, including purchase and sale disguised as a donation, 4 of print space and air
time for "campaign or other political purposes." Section 11 (b) does not purport in
any way to restrict the reporting by newspapers or radio or television stations of
news or news-worthy events relating to candidates, their qualifications, political
parties and programs of government. Moreover, Section 11 (b) does not reach
commentaries and expressions of belief or opinion by reporters or broadcasters or
editors or commentators or columnists in respect of candidates, their qualifications,
and programs and so forth, so long at least as such comments, opinions and beliefs
are not in fact advertisements for particular candidates covertly paid for. In sum,
Section 11 (b) is not to be read as reaching any report or commentary other coverage
that, in responsible media, is not paid for by candidates for political office. We read
Section 11 (b) as designed to cover only paid political advertisements of particular
candidates.

The above limitation in scope of application of Section 11 (b) that it does not
restrict either the reporting of or the expression of belief or opinion or comment upon
the qualifications and programs and activities of any and all candidates for office
constitutes the critical distinction which must be made between the instant case and
that of Sanidad v. Commission on Elections. 5 In Sanidad, the Court declared
unconstitutional Section 19 of Comelec Resolution No. 2167 which provided as
follows:
Sec. 19. Prohibition on Columnists, Commentators or Announcers During the
plebiscite campaign period, on the day before and on plebiscite day, no mass media
columnist, commentator, announcer or personality shall use his column or radio or
television time to campaign for or against the plebiscite issues.
Resolution No. 2167 had been promulgated by the Comelec in connection with the
plebiscite mandated by R.A. No. 6766 on the ratification or adoption of the Organic
Act for the Cordillera Autonomous Region. The Court held that Resolution No. 2167
constituted a restriction of the freedom of expression of petitioner Sanidad, a
newspaper columnist of the Baguio Midland Courier, "for no justifiable reason." The
Court, through Medialdea, J., said:
. . . [N]either Article, IX-C of the Constitution nor Section 11 [b], 2nd par. of R.A.
6646 can be construed to mean that the Comelec has also been granted the right to
supervise and regulate the exercise by media practitioners themselves of their right to
expression during plebiscite periods. Media practitioners exercising their freedom of
expression during plebiscite periods are neither the franchise holders nor the
candidates. In fact, there are no candidates involved in the plebiscite. Therefore,
Section 19 of Comelec Resolution No. 2167 has no statutory basis." 6 (Emphasis
partly in the original and partly supplied)
There is a third limitation upon the scope of application of Section 11 (b). Section 11
(b) exempts from its prohibition the purchase by or donation to the Comelec of print
space or air time, which space and time Comelec is then affirmatively required to
allocate on a fair and equal basis, free of charge, among the individual candidates for
elective public offices in the province or city served by the newspaper or radio or
television station. Some of the petitioners are apparently apprehensive that Comelec
might not allocate "Comelec time" or "Comelec space" on a fair and equal basis
among the several candidates. Should such apprehensions materialize, candidates
who are in fact prejudiced by unequal or unfair allocations effected by Comelec will
have appropriate judicial remedies available, so long at least as this Court sits. Until
such time, however, the Comelec is entitled to the benefit of the presumption that
official duty will be or is being regularly carried out. It seems appropriate here to
recall what Justice Laurel taught in Angara v. Electoral Commission 7 that the
possibility of abuse is no argument against the concession of the power or authority

40

involved, for there is no power or authority in human society that is not susceptible
of being abused. Should it be objected that the Comelec might refrain from procuring
"Comelec time" and "Comelec space," much the same considerations should be
borne in mind. As earlier noted, the Comelec is commanded by statute to buy or
"procure" "Comelec time" and "Comelec space" in mass media, and it must be
presumed that Comelec will carry out that statutory duty in this connection, and if it
does fail to do so, once again, the candidate or candidates who feel aggrieved have
judicial remedies at their disposal.
The points that may appropriately be underscored are that Section 11 (b) does not cut
off the flow of media reporting, opinion or commentary about candidates, their
qualifications and platforms and promises. Newspaper, radio broadcasting and
television stations remain quite free to carry out their regular and normal information
and communication operations. Section 11 (b) does not authorize any intervention
and much less control on the part of Comelec in respect of the content of the normal
operations of media, nor in respect of the content of political advertisements which
the individual candidates are quite free to present within their respective allocated
Comelec time and Comelec space. There is here no "officious functionary of [a]
repressive government" dictating what events or ideas reporters, broadcasters, editors
or commentators may talk or write about or display on TV screens. There is here no
censorship, whether disguised or otherwise. What Section 11 (b), viewed in context,
in fact does is to limit paid partisan political advertisements to for a other than
modern mass media, and to "Comelec time" and "Comelec space" in such mass
media.
Section 11 (b) does, of course, limit the right of free speech and of access to mass
media of the candidates themselves. The limitation, however, bears a clear and
reasonable connection with the constitutional objective set out in Article IX(C) (4)
and Article II (26) of the Constitution. For it is precisely in the unlimited purchase of
print space and radio and television time that the resources of the financially affluent
candidates are likely to make a crucial difference. Here lies the core problem of
equalization of the situations of the candidates with deep pockets and the candidates
with shallow or empty pockets that Article IX(C) (4) of the Constitution and Section
11 (b) seek to address. That the statutory mechanism which Section 11 (b) brings into
operation is designed and may be expected to bring about or promote equal
opportunity, and equal time and space, for political candidates to inform all and
sundry about themselves, cannot be gainsaid.
My learned brother in the Court Cruz, J. remonstrates, however, that "t[he] financial
disparity among the candidates is a fact of life that cannot be corrected by legislation
except only by the limitation of their respective expenses to a common maximum.
The flaw in the prohibition under challenge is that while the rich candidate is barred
from buying mass media coverage, it nevertheless allows him to spend his funds on
other campaign activities also inaccessible to his strained rival." True enough Section

11 (b) does not, by itself or in conjunction with Sections 90 and 92 of the Omnibus
Election Code, place political candidates on complete and perfect equality inter se
without regard to their financial affluence or lack thereof. But a regulatory measure
that is less than perfectly comprehensive or which does not completely obliterate the
evil sought to be remedied, is not for that reason alone constitutionally infirm. The
Constitution does not, as it cannot, exact perfection in governmental regulation. All it
requires, in accepted doctrine, is that the regulatory measure under challenge bear a
reasonable nexus with the constitutionally sanctioned objective. That the supervision
or regulation of communication and information media is not, in itself, a forbidden
modality is made clear by the Constitution itself in Article IX (C) (4).
It is believed that, when so viewed, the limiting impact of Section 11 (b) upon the
right to free speech of the candidates themselves may be seen to be not unduly
repressive or unreasonable. For, once again, there is nothing in Section 11 (b) to
prevent media reporting of and commentary on pronouncements, activities, written
statements of the candidates themselves. All other fora remain accessible to
candidates, even for political advertisements. The requisites of fairness and equal
opportunity are, after all, designed to benefit the candidates themselves.
Finally, the nature and characteristics of modern mass media, especially electronic
media, cannot be totally disregarded. Realistically, the only limitation upon the free
speech of candidates imposed is on the right of candidates to bombard the helpless
electorate with paid advertisements commonly repeated in the mass media ad
nauseam. Frequently, such repetitive political commercials when fed into the
electronic media themselves constitute invasions of the privacy of the general
electorate. It might be supposed that it is easy enough for a person at home simply to
flick off his radio of television set. But it is rarely that simple. For the candidates
with deep pockets may purchase radio or television time in many, if not all, the major
stations or channels. Or they may directly or indirectly own or control the stations or
channels themselves. The contemporary reality in the Philippines is that, in a very
real sense, listeners and viewers constitute a "captive audience." 8
The paid political advertisement introjected into the electronic media and repeated
with mind-deadening frequency, are commonly intended and crafted, not so much to
inform and educate as to condition and manipulate, not so much to provoke rational
and objective appraisal of candidates' qualifications or programs as to appeal to the
non-intellective faculties of the captive and passive audience. The right of the
general listening and viewing public to be free from such intrusions and their
subliminal effects is at least as important as the right of candidates to advertise
themselves through modern electronic media and the right of media enterprises to
maximize their revenues from the marketing of "packaged" candidates.
WHEREFORE, the Petitions should be, as they are hereby, DISMISSED for lack of
merit. No pronouncement as to costs.

41

SO ORDERED.

Narvasa, C.J., Melencio-Herrera, Bidin, Grio-Aquino, Medialdea, Regalado,


Romero and Nocon, JJ., concur.

EN BANC

Bellosillo, J., took no part.


Surveys affecting national candidates shall not be published fifteen (15) days before
an election and surveys affecting local candidates shall not be published seven (7)
days before an election.

[G.R. No. 147571. May 5, 2001]


SOCIAL WEATHER STATIONS, INCORPORATED and KAMAHALAN
PUBLISHING CORPORATION, doing business as MANILA STANDARD,
petitioners, vs. COMMISSION ON ELECTIONS, respondent.
DECISION
MENDOZA, J.:
Petitioner, Social Weather Stations, Inc. (SWS), is a private non-stock, non-profit
social research institution conducting surveys in various fields, including economics,
politics, demography, and social development, and thereafter processing, analyzing,
and publicly reporting the results thereof. On the other hand, petitioner Kamahalan
Publishing Corporation publishes the Manila Standard, a newspaper of general
circulation, which features newsworthy items of information including election
surveys.
Petitioners brought this action for prohibition to enjoin the Commission on Elections
from enforcing 5.4 of R.A. No. 9006 (Fair Election Act), which provides:
Surveys affecting national candidates shall not be published fifteen (15) days before
an election and surveys affecting local candidates shall not be published seven (7)
days before an election.
The term election surveys is defined in 5.1 of the law as follows:
Election surveys refer to the measurement of opinions and perceptions of the voters
as regards a candidates popularity, qualifications, platforms or a matter of public
discussion in relation to the election, including voters preference for candidates or
publicly discussed issues during the campaign period (hereafter referred to as
Survey).
To implement 5.4, Resolution 3636, 24(h), dated March 1, 2001, of the COMELEC
enjoins

Petitioner SWS states that it wishes to conduct an election survey throughout the
period of the elections both at the national and local levels and release to the media
the results of such survey as well as publish them directly. Petitioner Kamahalan
Publishing Corporation, on the other hand, states that it intends to publish election
survey results up to the last day of the elections on May 14, 2001.
Petitioners argue that the restriction on the publication of election survey results
constitutes a prior restraint on the exercise of freedom of speech without any clear
and present danger to justify such restraint. They claim that SWS and other pollsters
conducted and published the results of surveys prior to the 1992, 1995, and 1998
elections up to as close as two days before the election day without causing
confusion among the voters and that there is neither empirical nor historical evidence
to support the conclusion that there is an immediate and inevitable danger to the
voting process posed by election surveys. They point out that no similar restriction is
imposed on politicians from explaining their opinion or on newspapers or broadcast
media from writing and publishing articles concerning political issues up to the day
of the election. Consequently, they contend that there is no reason for ordinary voters
to be denied access to the results of election surveys which are relatively objective.
Respondent Commission on Elections justifies the restrictions in 5.4 of R.A. No.
9006 as necessary to prevent the manipulation and corruption of the electoral process
by unscrupulous and erroneous surveys just before the election. It contends that (1)
the prohibition on the publication of election survey results during the period
proscribed by law bears a rational connection to the objective of the law, i.e., the
prevention of the debasement of the electoral process resulting from manipulated
surveys, bandwagon effect, and absence of reply; (2) it is narrowly tailored to meet
the evils sought to be prevented; and (3) the impairment of freedom of expression is
minimal, the restriction being limited both in duration, i.e., the last 15 days before
the national election and the last 7 days before a local election, and in scope as it
does not prohibit election survey results but only require timeliness. Respondent
claims that in National Press Club v. COMELEC,[1] a total ban on political
advertisements, with candidates being merely allocated broadcast time during the socalled COMELEC space or COMELEC hour, was upheld by this Court. In contrast,
according to respondent, it states that the prohibition in 5.4 of R.A. No. 9006 is much
more limited.

42

For reasons hereunder given, we hold that 5.4 of R.A. No. 9006 constitutes an
unconstitutional abridgment of freedom of speech, expression, and the press.
To be sure, 5.4 lays a prior restraint on freedom of speech, expression, and the press
by prohibiting the publication of election survey results affecting candidates within
the prescribed periods of fifteen (15) days immediately preceding a national election
and seven (7) days before a local election. Because of the preferred status of the
constitutional rights of speech, expression, and the press, such a measure is vitiated
by a weighty presumption of invalidity.[2] Indeed, any system of prior restraints of
expression comes to this Court bearing a heavy presumption against its constitutional
validity. . . . The Government thus carries a heavy burden of showing justification for
the enforcement of such restraint.[3] There is thus a reversal of the normal
presumption of validity that inheres in every legislation.
Nor may it be argued that because of Art. IX-C, 4 of the Constitution, which gives
the COMELEC supervisory power to regulate the enjoyment or utilization of
franchise for the operation of media of communication, no presumption of invalidity
attaches to a measure like 5.4. For as we have pointed out in sustaining the ban on
media political advertisements, the grant of power to the COMELEC under Art. IXC, 4 is limited to ensuring equal opportunity, time, space, and the right to reply as
well as uniform and reasonable rates of charges for the use of such media facilities
for public information campaigns and forums among candidates.[4] This Court
stated:
The technical effect of Article IX (C) (4) of the Constitution may be seen to be that
no presumption of invalidity arises in respect of exercises of supervisory or
regulatory authority on the part of the Comelec for the purpose of securing equal
opportunity among candidates for political office, although such supervision or
regulation may result in some limitation of the rights of free speech and free press.[5]
MR. JUSTICE KAPUNAN dissents. He rejects as inappropriate the test of clear and
present danger for determining the validity of 5.4. Indeed, as has been pointed out in
Osmea v. COMELEC,[6] this test was originally formulated for the criminal law and
only later appropriated for free speech cases. Hence, while it may be useful for
determining the validity of laws dealing with inciting to sedition or incendiary
speech, it may not be adequate for such regulations as the one in question. For such a
test is concerned with questions of the gravity and imminence of the danger as basis
for curtailing free speech, which is not the case of 5.4 and similar regulations.
Instead, MR. JUSTICE KAPUNAN purports to engage in a form of balancing by
weighing and balancing the circumstances to determine whether public interest [in
free, orderly, honest, peaceful and credible elections] is served by the regulation of
the free enjoyment of the rights (page 7). After canvassing the reasons for the
prohibition, i.e., to prevent last-minute pressure on voters, the creation of bandwagon

effect to favor candidates, misinformation, the junking of weak and losing candidates
by their parties, and the form of election cheating called dagdag-bawas and invoking
the States power to supervise media of information during the election period (pages
11-16), the dissenting opinion simply concludes:
Viewed in the light of the legitimate and significant objectives of Section 5.4, it may
be seen that its limiting impact on the rights of free speech and of the press is not
unduly repressive or unreasonable. Indeed, it is a mere restriction, not an absolute
prohibition, on the publication of election surveys. It is limited in duration; it applies
only during the period when the voters are presumably contemplating whom they
should elect and when they are most susceptible to such unwarranted persuasion.
These surveys may be published thereafter. (Pages 17-18)
The dissent does not, however, show why, on balance, these considerations should
outweigh the value of freedom of expression. Instead, reliance is placed on Art. IXC, 4. As already stated, the purpose of Art. IX-C, 4 is to ensure equal opportunity,
time, and space and the right of reply, including reasonable, equal rates therefor for
public information campaigns and forums among candidates. Hence the validity of
the ban on media advertising. It is noteworthy that R.A. No. 9006, 14 has lifted the
ban and now allows candidates to advertise their candidacies in print and broadcast
media. Indeed, to sustain the ban on the publication of survey results would sanction
the censorship of all speaking by candidates in an election on the ground that the
usual bombasts and hyperbolic claims made during the campaigns can confuse voters
and thus debase the electoral process.
In sum, the dissent has engaged only in a balancing at the margin. This form of ad
hoc balancing predictably results in sustaining the challenged legislation and leaves
freedom of speech, expression, and the press with little protection. For anyone who
can bring a plausible justification forward can easily show a rational connection
between the statute and a legitimate governmental purpose. In contrast, the balancing
of interest undertaken by then Justice Castro in Gonzales v. COMELEC,[7] from
which the dissent in this case takes its cue, was a strong one resulting in his
conclusion that 50-B of R.A. No. 4880, which limited the period of election
campaign and partisan political activity, was an unconstitutional abridgment of
freedom of expression.
Nor can the ban on election surveys be justified on the ground that there are other
countries 78, according to the Solicitor General, while the dissent cites 28 which
similarly impose restrictions on the publication of election surveys. At best this
survey is inconclusive. It is noteworthy that in the United States no restriction on the
publication of election survey results exists. It cannot be argued that this is because
the United States is a mature democracy. Neither are there laws imposing an
embargo on survey results, even for a limited period, in other countries. As pointed
out by petitioners, the United Kingdom, Austria, Belgium, Denmark, Estonia,

43

Finland, Iceland, Ireland, Latvia, Malta, Macedonia, the Netherlands, Norway,


Sweden, and Ukraine, some of which are no older nor more mature than the
Philippines in political development, do not restrict the publication of election survey
results.
What test should then be employed to determine the constitutional validity of 5.4?
The United States Supreme Court, through Chief Justice Warren, held in United
States v. OBrien:
[A] government regulation is sufficiently justified [1] if it is within the constitutional
power of the Government; [2] if it furthers an important or substantial governmental
interest; [3] if the governmental interest is unrelated to the suppression of free
expression; and [4] if the incidental restriction on alleged First Amendment freedoms
[of speech, expression and press] is no greater than is essential to the furtherance of
that interest.[8]
This is so far the most influential test for distinguishing content-based from contentneutral regulations and is said to have become canonical in the review of such laws.
[9] It is noteworthy that the OBrien test has been applied by this Court in at least two
cases.[10]
Under this test, even if a law furthers an important or substantial governmental
interest, it should be invalidated if such governmental interest is not unrelated to the
suppression of free expression. Moreover, even if the purpose is unrelated to the
suppression of free speech, the law should nevertheless be invalidated if the
restriction on freedom of expression is greater than is necessary to achieve the
governmental purpose in question.
Our inquiry should accordingly focus on these two considerations as applied to 5.4.
First. Sec. 5.4 fails to meet criterion [3] of the OBrien test because the causal
connection of expression to the asserted governmental interest makes such interest
not unrelated to the suppression of free expression. By prohibiting the publication of
election survey results because of the possibility that such publication might
undermine the integrity of the election, 5.4 actually suppresses a whole class of
expression, while allowing the expression of opinion concerning the same subject
matter by newspaper columnists, radio and TV commentators, armchair theorists,
and other opinion makers. In effect, 5.4 shows a bias for a particular subject matter,
if not viewpoint, by preferring personal opinion to statistical results. The
constitutional guarantee of freedom of expression means that the government has no
power to restrict expression because of its message, its ideas, its subject matter, or its
content.[11] The inhibition of speech should be upheld only if the expression falls
within one of the few unprotected categories dealt with in Chaplinsky v. New
Hampshire,[12] thus:

There are certain well-defined and narrowly limited classes of speech, the prevention
and punishment of which have never been thought to raise any Constitutional
problem. These include the lewd and obscene, the profane, the libelous, and the
insulting or fighting words those which by their very utterance inflict injury or tend
to incite an immediate breach of the peace. [S]uch utterances are no essential part of
any exposition of ideas, and are of such slight social value as a step to truth that any
benefit that may be derived from them is clearly outweighed by the social interest in
order and morality.
Nor is there justification for the prior restraint which 5.4 lays on protected speech. In
Near v. Minnesota,[13] it was held:
[The] protection even as to previous restraint is not absolutely unlimited. But the
limitation has been recognized only in exceptional cases. . . . No one would question
but that a government might prevent actual obstruction to its recruiting service or the
publication of the sailing dates of transports or the number and location of troops. On
similar grounds, the primary requirements of decency may be enforced against
obscene publications. The security of the community life may be protected against
incitements to acts of violence and the overthrow by force of orderly government . . .
.
Thus, contrary to the claim of the Solicitor General, the prohibition imposed by 5.4
cannot be justified on the ground that it is only for a limited period and is only
incidental. The prohibition may be for a limited time, but the curtailment of the right
of expression is direct, absolute, and substantial. It constitutes a total suppression of
a category of speech and is not made less so because it is only for a period of fifteen
(15) days immediately before a national election and seven (7) days immediately
before a local election.
This sufficiently distinguishes 5.4 from R.A. No. 6646, 11(b), which this Court
found to be valid in National Press Club v. COMELEC[14] and Osmea v.
COMELEC.[15] For the ban imposed by R.A. No. 6646, 11(b) is not only authorized
by a specific constitutional provision,[16] but it also provided an alternative so that,
as this Court pointed out in Osmea, there was actually no ban but only a substitution
of media advertisements by the COMELEC space and COMELEC hour.
Second. Even if the governmental interest sought to be promoted is unrelated to the
suppression of speech and the resulting restriction of free expression is only
incidental, 5.4 nonetheless fails to meet criterion [4] of the OBrien test, namely, that
the restriction be not greater than is necessary to further the governmental interest.
As already stated, 5.4 aims at the prevention of last-minute pressure on voters, the
creation of bandwagon effect, junking of weak or losing candidates, and resort to the
form of election cheating called dagdag-bawas. Praiseworthy as these aims of the

44

regulation might be, they cannot be attained at the sacrifice of the fundamental right
of expression, when such aim can be more narrowly pursued by punishing unlawful
acts, rather than speech because of apprehension that such speech creates the danger
of such evils. Thus, under the Administrative Code of 1987,[17] the COMELEC is
given the power:
To stop any illegal activity, or confiscate, tear down, and stop any unlawful, libelous,
misleading or false election propaganda, after due notice and hearing.
This is surely a less restrictive means than the prohibition contained in 5.4. Pursuant
to this power of the COMELEC, it can confiscate bogus survey results calculated to
mislead voters. Candidates can have their own surveys conducted. No right of reply
can be invoked by others. No principle of equality is involved. It is a free market to
which each candidate brings his ideas. As for the purpose of the law to prevent
bandwagon effects, it is doubtful whether the Government can deal with this naturalenough tendency of some voters. Some voters want to be identified with the winners.
Some are susceptible to the herd mentality. Can these be legitimately prohibited by
suppressing the publication of survey results which are a form of expression? It has
been held that [mere] legislative preferences or beliefs respecting matters of public
convenience may well support regulation directed at other personal activities, but be
insufficient to justify such as diminishes the exercise of rights so vital to the
maintenance of democratic institutions.[18]
To summarize then, we hold that 5.4 is invalid because (1) it imposes a prior restraint
on the freedom of expression, (2) it is a direct and total suppression of a category of
expression even though such suppression is only for a limited period, and (3) the
governmental interest sought to be promoted can be achieved by means other than
the suppression of freedom of expression.
SUPREME COURT
Manila
EN BANC
G.R. No. 203302

April 11, 2013

MAYOR EMMANUEL L. MALIKSI, Petitioner,


vs.
COMMISSION ON ELECTIONS AND HOMER T. SAQUILAVAN, Respondents.
RESOLUTION
BERSAMIN, J.:

On the other hand, the COMELEC contends that under Art. IX-A, 7 of the
Constitution, its decisions, orders, or resolutions may be reviewed by this Court only
by certiorari. The flaws in this argument is that it assumes that its Resolution 3636,
dated March 1, 2001 is a decision, order, or resolution within the meaning of Art. IXA, 7. Indeed, counsel for COMELEC maintains that Resolution 3636 was rendered
by the Commission. However, the Resolution does not purport to adjudicate the right
of any party. It is not an exercise by the COMELEC of its adjudicatory power to
settle the claims of parties. To the contrary, Resolution 3636 clearly states that it is
promulgated to implement the provisions of R.A. No. 9006. Hence, there is no basis
for the COMELECs claim that this petition for prohibition is inappropriate.
Prohibition has been found appropriate for testing the constitutionality of various
election laws, rules, and regulations.[19]
WHEREFORE, the petition for prohibition is GRANTED and 5.4 of R.A. No. 9006
and 24(h) of COMELEC Resolution 3636, dated March 1, 2001, are declared
unconstitutional.
SO ORDERED.
Davide, Jr., C.J., Vitug, and Gonzaga-Reyes, JJ., concur.
Bellosillo, Pardo, Ynares-Santiago, and Sandoval-Gutierrez, JJ., join the dissent of J.
Kapunan.
Melo, Puno, and Panganiban, JJ., see concurring opinion.
Kapunan, J., see dissenting opinion.
Quisumbing, Buena, and De Leon, Jr., JJ., on leave.
The Court hereby resolves the Extremely Urgent Motion for Reconsideration tiled by
petitioner Emmanuel L. Maliksi against the Court's decision promulgated on March
12, 2013, dismissing his petition for certiorari assailing the resolution dated
September 14, 2012 of the Commission on Elections (COMELEC) En Bane that
sustained the declaration of respondent Homer T. Saquilayan as the duly elected
Mayor of Imus, Cavite.
For clarity, we briefly restate the factual antecedents.
During the 2010 Elections, the Municipal Board of Canvassers proclaimed
Saquilayan the winner for the position of Mayor of Imus, Cavite. Maliksi, the
candidate who garnered the second highest number of votes, brought an election
protest in the Regional Trial Court (RTC) in Imus, Cavite alleging that there were
irregularities in the counting of votes in 209 clustered precincts. Subsequently, the
RTC held a revision of the votes, and, based on the results of the revision, declared

45

Maliksi as the duly elected Mayor of Imus commanding Saquilayan to cease and
desist from performing the functions of said office. Saquilayan appealed to the
COMELEC. In the meanwhile, the RTC granted Maliksis motion for execution
pending appeal, and Maliksi was then installed as Mayor.

In his Extremely Urgent Motion for Reconsideration, Maliksi raises the following
arguments, to wit:

In resolving the appeal, the COMELEC First Division, without giving notice to the
parties, decided to recount the ballots through the use of the printouts of the ballot
images from the CF cards. Thus, it issued an order dated March 28, 2012 requiring
Saquilayan to deposit the amount necessary to defray the expenses for the decryption
and printing of the ballot images. Later, it issued another order dated April 17, 2012
for Saquilayan to augment his cash deposit.

WITH ALL DUE RESPECT, THIS HONORABLE SUPREME COURT EN


BANC GRAVELY ERRED IN DISMISSING THE INSTANT PETITION DESPITE
A CLEAR VIOLATION OF PETITIONERS CONSTITUTIONAL RIGHT TO
DUE PROCESS OF LAW CONSIDERING THAT DECRYPTION, PRINTING
AND EXAMINATION OF THE DIGITAL IMAGES OF THE BALLOTS, WHICH
IS THE BASIS FOR THE ASSAILED 14 SEPTEMBER 2012 RESOLUTION OF
THE PUBLIC RESPONDENT, WHICH IN TURN AFFIRMED THE 15 AUGUST
2012 RESOLUTION OF THE COMELEC FIRST DIVISION, WERE DONE
INCONSPICUOUSLY UPON A MOTU PROPRIO DIRECTIVE OF THE
COMELEC FIRST DIVISION SANS ANY NOTICE TO THE PETITIONER, AND
FOR THE FIRST TIME ON APPEAL.

On August 15, 2012, the First Division issued a resolution nullifying the RTCs
decision and declaring Saquilayan as the duly elected Mayor.1
Maliksi filed a motion for reconsideration, alleging that he had been denied his right
to due process because he had not been notified of the decryption proceedings. He
argued that the resort to the printouts of the ballot images, which were secondary
evidence, had been unwarranted because there was no proof that the integrity of the
paper ballots had not been preserved.
On September 14, 2012, the COMELEC En Banc resolved to deny Maliksis motion
for reconsideration.2
Maliksi then came to the Court via petition for certiorari, reiterating his objections to
the decryption, printing, and examination of the ballot images without prior notice to
him, and to the use of the printouts of the ballot images in the recount proceedings
conducted by the First Division.1wphi1
In the decision promulgated on March 12, 2013, the Court, by a vote of 8-7,
dismissed Maliksis petition for certiorari. The Court concluded that Maliksi had not
been denied due process because: (a) he had received notices of the decryption,
printing, and examination of the ballot images by the First Division referring to
the orders of the First Division directing Saquilayan to post and augment the cash
deposits for the decryption and printing of the ballot images; and (b) he had been
able to raise his objections to the decryption in his motion for reconsideration. The
Court then pronounced that the First Division did not abuse its discretion in deciding
to use the ballot images instead of the paper ballots, explaining that the printouts of
the ballot images were not secondary images, but considered original documents
with the same evidentiary value as the official ballots under the Rule on Electronic
Evidence; and that the First Divisions finding that the ballots and the ballot boxes
had been tampered had been fully established by the large number of cases of
double-shading discovered during the revision.

I.

II.
WITH ALL DUE RESPECT, THIS HONORABLE SUPREME COURT EN
BANC GRAVELY ERRED IN UPHOLDING THE COMELEC FIRST DIVISIONS
RULING TO DISPENSE WITH THE PHYSICAL BALLOTS AND RESORT TO
THEIR DIGITAL IMAGES NOTWITHSTANDING THE FACT THAT THE
BALLOTS ARE THE BEST AND MOST CONCLUSIVE EVIDENCE OF THE
VOTERS WILL, AND THAT BALLOT IMAGES CAN BE RESORTED TO
ONLY IF THE OFFICIAL BALLOTS ARE LOST OR THEIR INTEGRITY WAS
COMPROMISED AS DETERMINED BY THE RECOUNT/REVISION
COMMITTEE, CIRCUMSTANCES WHICH ARE WANTING IN THIS CASE,
AND IN FACT THE INTEGRITY OF THE BALLOT BOXES AND ITS
CONTENTS WAS PRESERVED AND THE ISSUE OF TAMPERING WAS ONLY
BELATEDLY RAISED BY THE PRIVATE RESPONDENT AFTER THE
REVISION RESULTS SHOWED THAT HE LOST.
III.
WITH ALL DUE RESPECT, IT IS THE HUMBLE SUBMISSION OF THE
PETITIONER-MOVANT THAT THE 12 MARCH 2013 RESOLUTION ISSUED
BY THE HONORABLE SUPREME COURT EN BANC IS NULL AND VOID AB
INITIO AND THEREFORE OF NO FORCE AND EFFECT, FOR HAVING BEEN
PROMULGATED DESPITE THE ABSENCE OF HONORABLE SUPREME
COURT JUSTICE JOSE PORTUGAL PEREZ AT THE TIME OF THE
DELIBERATION AND VOTING ON THE 12 MARCH 2013 RESOLUTION IN
THE INSTANT CASE.3

46

Maliksi insists: (a) that he had the right to be notified of every incident of the
proceedings and to be present at every stage thereof; (b) that he was deprived of such
rights when he was not informed of the decryption, printing, and examination of the
ballot images by the First Division; (c) that the March 28, 2012 and April 17, 2012
orders of the First Division did not sufficiently give him notice inasmuch as the
orders did not state the date, time, and venue of the decryption and printing of the
ballot images; and (d) that he was thus completely deprived of the opportunity to
participate in the decryption proceedings.
Maliksi contends that the First Divisions motu proprio directive for the decryption,
printing, and examination of the ballot images was highly irregular. In this regard, he
asserts: (a) that the decryption, printing, and examination should have taken place
during the revision before the trial court and after the revision committee had
determined that the integrity of the official ballots had not been preserved; (b) that
the trial court did not make such determination; (c) that, in fact, Saquilayan did not
allege or present any proof in the RTC to show that the ballots or the ballot boxes
had been tampered, and had, in fact, actively participated in the revision proceedings;
(d) that the First Division should not have entertained the allegation of ballot
tampering belatedly raised on appeal; (e) that the First Division should have limited
itself to reviewing the evidence on record; and (f) that the First Division did not even
explain how it had arrived at the conclusion that the integrity of the ballots had not
been preserved.
Maliksi submits that the decision promulgated on March 12, 2013 is null and void
for having been promulgated despite the absence from the deliberations and lack of
signature of Justice Jose Portugal Perez.

As we see it, the First Division arbitrarily arrogated unto itself the conduct of the
recount proceedings, contrary to the regular procedure of remanding the protest to
the RTC and directing the reconstitution of the Revision Committee for the
decryption and printing of the picture images and the revision of the ballots on the
basis thereof. Quite unexpectedly, the COMELEC En Banc upheld the First
Divisions unwarranted deviation from the standard procedures by invoking the
COMELECs power to "take such measures as the Presiding Commissioner may
deem proper," and even citing the Courts minute resolution in Alliance of Barangay
Concerns (ABC) Party-List v. Commission on Elections5 to the effect that the
"COMELEC has the power to adopt procedures that will ensure the speedy
resolution of its cases. The Court will not interfere with its exercise of this
prerogative so long as the parties are amply heard on their opposing claims."
Based on the pronouncement in Alliance of Barangay Concerns (ABC) v.
Commission on Elections, the power of the COMELEC to adopt procedures that will
ensure the speedy resolution of its cases should still be exercised only after giving to
all the parties the opportunity to be heard on their opposing claims. The parties right
to be heard upon adversarial issues and matters is never to be waived or sacrificed, or
to be treated so lightly because of the possibility of the substantial prejudice to be
thereby caused to the parties, or to any of them. Thus, the COMELEC En Banc
should not have upheld the First Divisions deviation from the regular procedure in
the guise of speedily resolving the election protest, in view of its failure to provide
the parties with notice of its proceedings and an opportunity to be heard, the most
basic requirements of due process.
I.

Ruling
Due process requirements
The Court grants Maliksis Extremely Urgent Motion for Reconsideration, and
reverses the decision promulgated on March 12, 2013 on the ground that the First
Division of the COMELEC denied to him the right to due process by failing to give
due notice on the decryption and printing of the ballot images. Consequently, the
Court annuls the recount proceedings conducted by the First Division with the use of
the printouts of the ballot images.
It bears stressing at the outset that the First Division should not have conducted the
assailed recount proceedings because it was then exercising appellate jurisdiction as
to which no existing rule of procedure allowed it to conduct a recount in the first
instance. The recount proceedings authorized under Section 6, Rule 15 of
COMELEC Resolution No. 8804, as amended, are to be conducted by the
COMELEC Divisions only in the exercise of their exclusive original jurisdiction
over all election protests involving elective regional (the autonomous regions),
provincial and city officials.4

The picture images of the ballots are electronic documents that are regarded as the
equivalents of the original official ballots themselves.6 In Vinzons-Chato v. House of
Representatives Electoral Tribunal,7 the Court held that "the picture images of the
ballots, as scanned and recorded by the PCOS, are likewise official ballots that
faithfully capture in electronic form the votes cast by the voter, as defined by Section
2(3) of R.A. No. 9369. As such, the printouts thereof are the functional equivalent of
the paper ballots filled out by the voters and, thus, may be used for purposes of
revision of votes in an electoral protest."
That the two documentsthe official ballot and its picture imageare considered
"original documents" simply means that both of them are given equal probative
weight. In short, when either is presented as evidence, one is not considered as
weightier than the other.

47

But this juridical reality does not authorize the courts, the COMELEC, and the
Electoral Tribunals to quickly and unilaterally resort to the printouts of the picture
images of the ballots in the proceedings had before them without notice to the
parties. Despite the equal probative weight accorded to the official ballots and the
printouts of their picture images, the rules for the revision of ballots adopted for their
respective proceedings still consider the official ballots to be the primary or best
evidence of the voters will. In that regard, the picture images of the ballots are to be
used only when it is first shown that the official ballots are lost or their integrity has
been compromised.
For instance, the aforesaid Section 6, Rule 15 of COMELEC Resolution No. 8804
(In Re: Comelec Rules of Procedure on Disputes In An Automated Election System
in Connection with the May 10, 2010 Elections), as amended by COMELEC
Resolution No. 9164, itself requires that "the Recount Committee determines that the
integrity of the ballots has been violated or has not been preserved, or are wet and
otherwise in such a condition that (the ballots) cannot be recounted" before the
printing of the image of the ballots should be made, to wit:
xxxx
(g) Only when the Recount Committee, through its chairman, determines that the
integrity of the ballots has been preserved or that no signs of tampering of the ballots
are present, will the recount proceed. In case there are signs that the ballots contained
therein are tampered, compromised, wet or are otherwise in such a condition that it
could not be recounted, the Recount Committee shall follow paragraph (l) of this
rule.
xxxx
(l) In the event the Recount Committee determines that the integrity of the ballots
has been violated or has not been preserved, or are wet and otherwise in such a
condition that it cannot be recounted, the Chairman of the Committee shall request
from the Election Records and Statistics Department (ERSD), the printing of the
image of the ballots of the subject precinct stored in the CF card used in the May 10,
2010 elections in the presence of the parties. Printing of the ballot images shall
proceed only upon prior authentication and certification by a duly authorized
personnel of the Election Records and Statistics Department (ERSD) that the data or
the images to be printed are genuine and not substitutes. (Emphases supplied.)
xxxx
Section 6, Rule 10 (Conduct of Revision) of the 2010 Rules of Procedure for
Municipal Election Contests, which governs the proceedings in the Regional Trial
Courts exercising original jurisdiction over election protests, provides:

xxxx
(m) In the event that the revision committee determines that the integrity of the
ballots and the ballot box have not been preserved, as when proof of tampering or
substitution exists, it shall proceed to instruct the printing of the picture image of the
ballots stored in the data storage device for the precinct. The court shall provide a
non-partisan technical person who shall conduct the necessary authentication process
to ensure that the data or image stored is genuine and not a substitute. Only after this
determination can the printed picture image be used for the recount. (Emphases
supplied.)
xxxx
A similar procedure is found in the 2010 Rules of the Presidential Electoral Tribunal,
to wit:
Rule 43. Conduct of the revision. The revision of votes shall be done through the
use of appropriate PCOS machines or manually and visually, as the Tribunal may
determine, and according to the following procedures:
xxxx
(q) In the event that the RC determines that the integrity of the ballots and the ballot
box was not preserved, as when there is proof of tampering or substitution, it shall
proceed to instruct the printing of the picture image of the ballots of the subject
precinct stored in the data storage device for the same precinct. The Tribunal may
avail itself of the assistance of the COMELEC for the service of a non-partisan
technical person who shall conduct the necessary authentication process to ensure
that the data or images stored are genuine and not merely substitutes. It is only upon
such determination that the printed picture image can be used for the revision of
votes. (Emphases supplied.)
xxxx
Also, the House of Representative Electoral Tribunals Guidelines on the Revision of
Ballots requires a preliminary hearing to be held for the purpose of determining
whether the integrity of the ballots and ballot boxes used in the May 10, 2010
elections was not preserved, as when there is proof of tampering or substitutions, to
wit:
Section 10. Revision of Ballots
xxxx

48

(d) When it has been shown, in a preliminary hearing set by the parties or by the
Tribunal, that the integrity of the ballots and ballot boxes used in the May 10, 2010
elections was not preserved, as when there is proof of tampering or substitutions, the
Tribunal shall direct the printing of the picture images of the ballots of the subject
precinct stored in the data storage device for the same precinct. The Tribunal shall
provide a non-partisan technical person who shall conduct the necessary
authentication process to ensure that the data or image stored is genuine and not a
substitute. It is only upon such determination that the printed picture image can be
used for the revision. (As amended per Resolution of February 10, 2011; Emphases
supplied.)

that the First Division declared as justification was a simple generalization of the
same being apparent from the allegations of ballot and ballot box tampering and
upon inspection of the ballot boxes, viz:
xxxx
The Commission (First Division) took into consideration the allegations of ballot and
ballot box tampering and upon inspecting the ballot boxes, it is apparent that the
integrity of the ballots had been compromised so, to be able to best determine the
true will of the electorate, we decided to go over the digital image of the appealed
ballots.8 (Emphasis supplied)

xxxx

xxxx

All the foregoing rules on revision of ballots stipulate that the printing of the picture
images of the ballots may be resorted to only after the proper Revision/Recount
Committee has first determined that the integrity of the ballots and the ballot boxes
was not preserved.

It was the COMELEC En Bancs assailed resolution of September 14, 2012 that later
on provided the explanation to justify the First Divisions resort to the picture images
of the ballots, by observing that the "unprecedented number of double-votes"
exclusively affecting the position of Mayor and the votes for Saquilayan had led to
the belief that the ballots had been tampered. However, that explanation by the
COMELEC En Banc did not cure the First Divisions lapse and did not erase the
irregularity that had already invalidated the First Divisions proceedings.

The foregoing rules further require that the decryption of the images stored in the CF
cards and the printing of the decrypted images take place during the revision or
recount proceedings. There is a good reason for thus fixing where and by whom the
decryption and the printing should be conducted. It is during the revision or recount
conducted by the Revision/Recount Committee when the parties are allowed to be
represented, with their representatives witnessing the proceedings and timely raising
their objections in the course of the proceedings. Moreover, whenever the
Revision/Recount Committee makes any determination that the ballots have been
tampered and have become unreliable, the parties are immediately made aware of
such determination.
When, as in the present case, it was not the Revision/Recount Committee or the RTC
exercising original jurisdiction over the protest that made the finding that the ballots
had been tampered, but the First Division in the exercise of its appellate jurisdiction,
the parties should have been given a formal notice thereof.
Maliksi was not immediately made aware of that crucial finding because the First
Division did not even issue any written resolution stating its reasons for ordering the
printing of the picture images. The parties were formally notified that the First
Division had found that the ballots had been tampered only when they received the
resolution of August 15, 2012, whereby the First Division nullified the decision of
the RTC and declared Saquilayan as the duly elected Mayor. Even so, the resolution
of the First Division to that effect was unusually mute about the factual bases for the
finding of ballot box tampering, and did not also particularize how and why the First
Division was concluding that the integrity of the ballots had been compromised. All

In his dissenting opinion, Justice Antonio T. Carpio advances the view that the
COMELECs finding of ballot tampering was a mere surplusage because there was
actually no need for such finding before the ballots digital counterparts could be
used. He cites Section 3, Rule 16 of COMELEC Resolution No. 8804, as amended
by Resolution No. 9164, which states:
Section 3. Printing of Ballot Images. - In case the parties deem it necessary, they may
file a motion to be approved by the Division of the Commission requesting for the
printing of ballot images in addition to those mentioned in the second paragraph of
item (e). Parties concerned shall provide the necessary materials in the printing of
images such as but not limited to copying papers, toners and printers. Parties may
also secure, upon prior approval by the Division of the Commission, a soft copy of
the ballot images contained in a secured/hashed disc on the condition that the ballot
images be first printed, at the expense of the requesting party, and that the printed
copies be signed by the parties respective revisors or representatives and by an
ERSD IT-capable representative and deposited with the Commission.
The Over-all chairman shall coordinate with the Director IV, Election Records and
Statistics Department (ERSD), for the printing of images. Said director shall in turn
designate a personnel who will be responsible in the printing of ballot images.

49

Justice Carpio posits that when a party files a motion for the printing of the ballots
that he or she deems necessary, there is actually no need for a finding of tampering of
the ballots or the ballot boxes before the COMELEC Division may grant the motion.
He states that a determination by the parties that the printing is necessary under
Section 3 is a ground separate from Section 6(e), which in turn pertinently states that:
Section 6. Conduct of the Recount
xxxx
(e) Before the opening of the ballot box, the Recount Committee shall note its
condition as well as that of the locks or locking mechanism and record the condition
in the recount report. From its observation, the Recount Committee must also make a
determination as to whether the integrity of the ballot box has been preserved.
In the event that there are signs of tampering or if the ballot box appears to have been
compromised, the Recount Committee shall still proceed to open the ballot box and
make a physical inventory of the contents thereof. The committee shall, however,
record its general observation of the ballots and other documents found in the ballot
box.
The application of Section 3 to this case is inappropriate, considering that the First
Division did not in any way suggest in its decision dated August 15, 2010 that it was
resolving Saquilayans motion to print the ballot images. Instead, the First Division
made therein a finding of tampering, thus:
The COMELEC (First Division) took into consideration the allegations of ballot and
ballot box tampering and upon inspecting the ballot boxes, it is apparent that the
integrity of the ballots had been compromised so, to be able to best determine the
true will of the electorate, we decided to go over the digital images of the appealed
ballots.
Even the COMELEC En Banc did not indicate in its decision dated September 14,
2012 that the First Division merely resolved Saquilayans motion for the printing of
the ballot images; instead, it reinforced the First Divisions finding that there was
tampering of the ballots. The non-mention of Saquilayans motion was a clear
indication of the COMELECs intention to act motu proprio; and also revealed its
interpretation of its very own rules, that there must be justifiable reason, i.e.
tampering, before the ballot images could be resorted to.
The application of Section 3 would only highlight the First Divisions denial of
Maliksis right to due process. For, if the First Division was really only acting on a
motion to allow the printing of the ballot images, there was a greater reason for the

First Division to have given the parties notice of its ruling thereon. But, as herein
noted, the First Division did not issue such ruling.
To interpret Section 3 as granting to any one of the parties the right to move for the
printing of the ballot images should such party deem it necessary, and the
COMELEC may grant such motion, is contrary to its clear wording. Section 3
explicitly states: "in case the parties deem it necessary, they may file a motion." The
provision really envisions a situation in which both parties have agreed that the ballot
images should be printed. Should only one of the parties move for the printing of the
ballot images, it is not Section 3 that applies but Section 6(e), which then requires a
finding that the integrity of the ballots has been compromised.
The disregard of Maliksis right to be informed of the decision to print the picture
images of the ballots and to conduct the recount proceedings during the appellate
stage cannot be brushed aside by the invocation of the fact that Maliksi was able to
file, after all, a motion for reconsideration. To be exact, the motion for
reconsideration was actually directed against the entire resolution of the First
Division, while Maliksis claim of due process violation is directed only against the
First Divisions recount proceedings that resulted in the prejudicial result rendered
against him. Notably, the First Division did not issue any order directing the recount.
Without the written order, Maliksi was deprived of the chance to seek any
reconsideration or even to assail the irregularly-held recount through a seasonable
petition for certiorari in this Court. In that context, he had no real opportunity to
assail the conduct of the recount proceedings.
The service of the First Division orders requiring Saquilayan to post and augment the
cash deposits for the printing of the picture images did not sufficiently give Maliksi
notice of the First Divisions decision to print the picture images. The said orders did
not meet the requirements of due process because they did not specifically inform
Maliksi that the ballots had been found to be tampered. Nor did the orders offer the
factual bases for the finding of tampering. Hence, to leave for Maliksi to surmise on
the factual bases for finding the need to print the picture images still violated the
principles of fair play, because the responsibility and the obligation to lay down the
factual bases and to inform Maliksi as the party to be potentially prejudiced thereby
firmly rested on the shoulders of the First Division.
Moreover, due process of law does not only require notice of the decryption,
printing, and recount proceedings to the parties, but also demands an opportunity to
be present at such proceedings or to be represented therein. Maliksi correctly
contends that the orders of the First Division simply required Saquilayan to post and
augment his cash deposit. The orders did not state the time, date, and venue of the
decryption and recount proceedings. Clearly, the First Division had no intention of
giving the parties the opportunity to witness its proceedings.

50

Mendoza v. Commission on Elections9 instructs that notice to the parties and their
participation are required during the adversarial aspects of the proceedings. In that
case, after the revision of the ballots and after the election protest case was submitted
for decision, the ballots and ballot boxes were transferred to the Senate Electoral
Tribunal (SET) in connection with a protest case pending in the SET. Mendoza later
learned that the COMELEC, with the permission of the SET, had meanwhile
conducted proceedings within the SETs premises. Mendoza then claimed that his
right to due process was violated because he had not been given notice by the
COMELEC that it would be conducting further proceedings within the SET
premises. The Court did not sustain his claim, however, and pointed out:
After consideration of the respondents Comments and the petitioners petition and
Reply, we hold that the contested proceedings at the SET ("contested proceedings")
are no longer part of the adversarial aspects of the election contest that would require
notice of hearing and the participation of the parties. As the COMELEC stated in its
Comment and without any contrary or disputing claim in the petitioners Reply:
"However, contrary to the claim of petitioner, public respondent in the appreciation
of the contested ballots in EPC No. 2007-44 simultaneously with the SET in SET
Case No. 001-07 is not conducting "further proceedings" requiring notice to the
parties. There is no revision or correction of the ballots because EPC No. 2007-04
was already submitted for resolution. Public respondent, in coordinating with the
SET, is simply resolving the submitted protest case before it. The parties necessarily
take no part in said deliberation, which require utmost secrecy. Needless to state, the
actual decision-making process is supposed to be conducted only by the designated
members of the Second Division of the public respondent in strict confidentiality."
In other words, what took place at the SET were the internal deliberations of the
COMELEC, as a quasi-judicial body, in the course of appreciating the evidence
presented and deciding the provincial election contest on the merits. These
deliberations are no different from judicial deliberations which are considered
confidential and privileged. We find it significant that the private respondents
Comment fully supported the COMELECs position and disavowed any participation
in the contested proceeding the petitioner complained about. The petitioner, on the
other hand, has not shown that the private respondent was ever present in any
proceeding at the SET relating to the provincial election contest.1wphi1
To conclude, the rights to notice and to be heard are not material considerations in
the COMELECs handling of the Bulacan provincial election contest after the
transfer of the ballot boxes to the SET; no proceedings at the instance of one party or
of COMELEC has been conducted at the SET that would require notice and hearing
because of the possibility of prejudice to the other party. The COMELEC is under no
legal obligation to notify either party of the steps it is taking in the course of
deliberating on the merits of the provincial election contest. In the context of our

standard of review for the petition, we see no grave abuse of discretion amounting to
lack or excess of jurisdiction committed by the COMELEC in its deliberation on the
Bulacan election contest and the appreciation of ballots this deliberation entailed.10
(Emphasis supplied.)
Here, the First Division denominated the proceedings it had conducted as an
"appreciation of ballots" like in Mendoza. But unlike in Mendoza, the proceedings
conducted by the First Division were adversarial, in that the proceedings included the
decryption and printing of the picture images of the ballots and the recount of the
votes were to be based on the printouts of the picture images. The First Division did
not simply review the findings of the RTC and the Revision Committee, but actually
conducted its own recount proceedings using the printouts of the picture image of the
ballots. As such, the First Division was bound to notify the parties to enable them to
participate in the proceedings.
Significantly, Section 6(l), Rule 15 of COMELEC Resolution No, 8804, as amended
by COMELEC Resolution No. 9164, requires the parties presence during the
printing of the images of the ballots, thus:
xxxx
(l) In the event the Recount Committee determines that the integrity of the ballots
has been violated or has not been preserved, or are wet and otherwise in such a
condition that it cannot be recounted, the Chairman of the Committee shall request
from the Election Records and Statistics Department (ERSD), the printing of the
image of the ballots of the subject precinct stored in the CF card used in the May 10,
2010 elections in the presence of the parties. Printing of the ballot images shall
proceed only upon prior authentication and certification by a duly authorized
personnel of the Election Records and Statistics Department (ERSD) that the data or
the images to be printed are genuine and not substitutes.
xxxx
We should not ignore that the parties participation during the revision and recount
proceedings would not benefit only the parties, but was as vital and significant for
the COMELEC as well, for only by their participation would the COMELECs
proceedings attain credibility as to the result. The parties presence would have
ensured that the requisite procedures have been followed, including the required
authentication and certification that the images to be printed are genuine. In this
regard, the COMELEC was less than candid, and was even cavalier in its conduct of
the decryption and printing of the picture images of the ballots and the recount
proceedings. The COMELEC was merely content with listing the guidelines that the
First Division had followed in the appreciation of the ballots and the results of the

51

recount. In short, there was vagueness as to what rule had been followed in the
decryption and printing proceeding.

process, a cornerstone of our legal system.11 After all, it is the Courts primary duty
to protect the basic rights of the people vis--vis government actions, thus:

II.

It cannot be denied that most government actions are inspired with noble intentions,
all geared towards the betterment of the nation and its people. But then again, it is
important to remember this ethical principle: "The end does not justify the means."
No matter how noble and worthy of admiration the purpose of an act, but if the
means to be employed in accomplishing it is simply irreconcilable with
constitutional parameters, then it cannot still be allowed. The Court cannot just turn a
blind eye and simply let it pass. It will continue to uphold the Constitution and its
enshrined principles.12

Remand to the COMELEC


We are mindful of the urgent need to speedily resolve the election protest because the
term of the position involved is about to end. Thus, we overlook pro hac vice the lack
of factual basis for the COMELECs decision to use the digital images of the ballots
and sustain its decision thereon. Although a remand of the election protest to the
RTC would have been the appropriate procedure, we direct the COMELEC En Banc
instead to conduct the decryption and printing of the digital images of the ballots and
to hold recount proceedings, with due notice to all the parties and opportunity for
them to be present and to participate during such proceedings. Nothing less serves
the ideal objective safeguarded by the Constitution.
In the absence of particular rules to govern its proceedings in accordance with this
disposition, the COMELEC is urged to follow and observe Rule 15 of COMELEC
Resolution No. 8804, as amended by COMELEC Resolution No. 9164.
The Court, by this resolution, does not intend to validate the victory of any of the
parties in the 2010 Elections. That is not the concern of the Court as yet. The Court
simply does not want to countenance a denial of the fundamental right to due
SUPREME COURT
Manila

WHEREFORE, the Court PARTIALLY GRANTS the Extremely Urgent Motion for
Reconsideration of petitioner Emmanuel Maliksi; REVERSES the Court's decision
promulgated on March 12, 2013; and DIRECTS the Commission on Elections En
Bane to conduct proceedings for the decryption of the picture images of the ballots
involved in the protest after due authentication, and for the recount of ballots by
using the printouts of the ballot images, with notice to and in the presence of the
parties or their representatives in accordance with the procedure laid down by Rule
15 of COMELEC Resolution No. 8804, as amended by Resolution No. 9164.
No pronouncement on costs of suit.
SO ORDERED.
Resolution reversed and set aside the Resolution of the COMELEC First Division
dated August 23, 2011, which, in turn, affirmed the May 4, 2011 Decision in Election
Case No. 02480-EC of the Metropolitan Trial Court (MeTC), Branch 4 in Manila.

EN BANC
The Facts
G.R. No. 204828

December 3, 2013

JAIME C. REGIO, Petitioner,


vs.
COMMISSION ON ELECTIONS and RONNIE C. CO, Respondents.
DECISION
VELASCO, JR., J.:

Petitioner Jaime C. Regio (Regio) and private respondent Ronnie C. Co (Co), among
other candidates, ran in the October 25, 2010 barangay elections in Barangay 296,
Zone 28, District III of the City of Manila for the position of punong barangay.
Immediately following the counting and canvassing of the votes from seven
clustered precincts in the adverted barangay, Regio, who garnered four hundred
seventy-eight (478) votes, as against the three hundred thirty-six (336) votes
obtained by Co, was proclaimed winner for the contested post of punong barangay.
The detailed tally of the votes per precinct, as reflected in the Statement of Votes, is
as follows:1

The Case
Candidate
This petition for certiorari filed under Rule 64, in relation to Rule 65, seeks to nullify
and set aside the Resolution dated December 7, 2012 of the Commission on
Elections (COMELEC_ EN Banc in EAC (BRGY-SK) No. 161-2011. The assailed

Clustered Precinct Number

52

73
Total
83
1302A 1303A
478
1304A 1305A
1306A
1307A 1307B
Co, Ronnie C.
76

On November 4, 2010, Co filed an election protest before the MeTC. He claimed,


among other things, that the Board of Election Tellers (BET) did not follow
COMELEC Resolution No. 9030, as it: (1) did not permit his supporters to vote; (2)
allowed "flying voters" to cast votes; and (3) ignored the rules on appreciation of
ballots, resulting in misreading, miscounting, and misappreciation of ballots.
Additionally, he alleged that Regio committed vote-buying, and engaged in
distribution of sample ballots inside the polling centers during the day of the
elections.2
Of the seven clustered precincts (CPs) initially protested, Co would later exclude CP
Nos. 1304A and 1305A from the protest. During the preliminary conference, the trial
court allowed the revision of ballots. The revision of ballots occurred on January 1314, 2011.3 Per the report of the revision committee, the number of votes obtained by
both candidates in the contested precincts, as shown below, indicated a substantial
recovery on the part of Co:

113

Candidate

48

Clustered Precinct Number

99

Total

336
Regio, Jaime C.
171
151

1302A 1303A
1304A 1305A
1306A

53

1307A 1307B
Co, Ronnie C.
160
-63
98
321
Regio, Jaime C.
86
--

He presented as witnesses the following: poll watchers Evangeline Garcia, Cezar


Regio, and Ruben Merilles, who all testified that there were no instances of electoral
fraud, irregularities, and anomalies during the day of the elections. Presented too
were volunteers Love Agpaoa and Romy Que, who belied allegations of
miscounting, misreading, and misappreciation of the ballots during the counting, and
Dominador Dela Cruz, Chairperson of the BET for CP Nos. 1302A/1303A, as well
as Erlina Hernandez, Chairperson of the BET for CP No. 1306A, who both testified
that they followed the rules and regulations in conducting the elections in Barangay
296, and that each ballot was correctly tabulated.4
The results of the revision notwithstanding, the trial court, in its Decision of May 4,
2011, dismissed Cos protest and declared Regio as the duly-elected punong
barangay of Barangay 296. It disposed of the case, as follows:
WHEREFORE, the proclamation of protestee Jaime C. Regio as the duly elected
"Punong Barangay" or "Barangay Chairman" of Barangay 296, District III, Manila
by the Barangay Board of Canvassers is affirmed by this court. The election protest
filed by the protestant Ronnie C. Co is dismissed for lack of merit.5
According to the trial court, before it can accord credence to the results of the
revision, it should first be ascertained that the ballots found in the box during the
revision are the same ballots deposited by the voters. In fine, the court "should first
be convinced that the ballots counted during the revision have not been tampered
with before it can declare the ballots a) as superior evidence of how the electorate
voted, and b) as sufficient evidence to set aside the election returns. For the ballots to
be considered the best evidence of how the voters voted, their integrity should be
satisfactorily established."6 Invoking Rosal v. COMELEC,7 the trial court ruled that
Co failed to sufficiently show that the integrity of the contested ballots had been
preserved. It then cited the presumption that election returns are genuine, and that the
data and information supplied by the board of election inspectors are true and
correct.8

62
The trial court said:
84
232
During his turn to present evidence, Co limited his offer to the revision committee
report, showing that he garnered the highest number of votes. Regio, on the other
hand, denied that the elections were tainted with irregularities. He claimed that the
results of the revision are products of post-elections operations, as the ballots were
tampered with, switched, and altered drastically to change the results of the elections.

A closer scrutiny of the premise made by the protestant will reveal that he is trying to
prove the misreading, miscounting, and misappreciation of ballots by introducing as
evidence the marked difference of the results of the revision and of the results in the
election returns. This premise is too presumptuous. The marked difference cannot be
used to prove the misreading, miscounting, and misappreciation of ballots because
the misreading, miscounting, and misappreciation of ballots is precisely what the
protestant needs to prove to justify the marked difference in the results. Prudence
dictates that the protestant should first explain where this huge discrepancy is
coming from before using it as evidence. In other words, the misreading,
miscounting, and misappreciation of ballots should be proven by other independent

54

evidence. Without any evidence, the allegation of misreading, miscounting, and


misappreciation of ballots remains a mere allegation without any probative value.9
Traversing the allegations of post-elections tampering, the trial court rejected Cos
allegation that the ballot boxes were properly locked and sealed. In fact, the trial
court said, the envelope containing the ballots for CP Nos. 1302A/1303A was glued
on both sides, prompting protestees revisor to comment that the envelope appears to
be re-pasted and tampered. In CP No. 1306A, the report stated that the ballots were
not placed in a sealed envelope.10 Corollarily, the trial court stated the observation
that Regio has presented credible witnesses to prove that there were no irregularities
or anomalies during the casting and counting of votes. Aggrieved, Co filed an appeal
before the COMELEC, arguing that the trial court erred:
1.) In disregarding the result of the physical count of the revised ballots found in
Precinct Nos. 1302A/1303A and 1306A;
2.) In declaring that the protestant appellant was not able to sufficiently show that the
integrity of the contested ballots in Precinct Nos. 1302A/1303A and 1306A was
preserved;

It also affirmed the rejection of Cos reliance on the revision committee report as
proof that no post-election tampering occurred. The COMELEC First Division
observed:
We note that protestant-appellant did not offer any evidence to prove his claims of
misreading, miscounting, and misappreciation of the ballots; he posits that the
variance between the election results according to the election documents and the
revision of the ballots is in itself enough to prove his allegations of misreading,
miscounting, and misappreciation of the ballots by the Board of Election Tellers.
Protestant-appellant begs the question instead of laying support to his claims. x x x x
Since it could not divine the will of the electorate from the ballots, the trial court had
no other recourse other than to rely on the available election documents. And, We
cannot fault the trial court for doing so when there was no question as to the election
documents authenticity and validity. Protestant-appellant harps that the election
documents are "mere by-products of the electoral fraud committed to benefit
(protestee-appellee) including but not limited to misreading, miscounting, and
misappreciation of ballots by the Chairpersons of the Board of Election Tellers in
order to increase the votes of the Protestee-Appellee and decrease the votes that
should have been properly credited to Protestant-Appellant Co."

3.) In declaring that protestant-appellant was not able to overcome the presumption
of regularity of the election, counting, and canvassing proceedings in the protested
precincts of Barangay 296, Manila;

(emphasis in the original)

4.) In declaring that the votes obtained by the parties in Precinct Nos. 1302A/1303A
and 1306A as reflected in their respective Election Returns are [the] true and actual
results of the elections;

As previously mentioned, protestant-appellants assertion is specious x x x. The


records of the case is bereft of any evidence supporting protestant-appellants claims
of electoral fraud and, thus, We concur with the trial court stating, "(w)ithout any
evidence, the allegation of misreading, miscounting, and misappreciation of ballots
remains a mere allegation without probative value."14

5.) In giving weight to the incredulous and conflicting testimonies of the obviously
biased witnesses of the protestee-appellee;
6.) In refusing to lend credence to the testimony of the expert witness from the
Commission on Elections that the ballots obtained from Precinct Nos. 1302A/1303A
and 1306A are genuine ballots; and
7.) In refusing to appreciate the contested and revised ballots for Precinct Nos.
1302A/1303A and 1306A and the appreciation of the contested ballots found in
Precinct No. 1307A/1307B.11
In a Resolution dated August 23, 2011, the COMELEC First Division12 dismissed
the appeal, noting, as the MeTC did, that Co failed to show that the integrity of the
ballots in question was in fact preserved. Echoing the trial court, the COMELEC
First Division ruled that the absence of any report or record of tampering of the
ballot boxes does not preclude the possibility of ballot tampering.13

The COMELEC First Division noted that Co could have, but did not, presented
testimonies of witnesses to substantiate his claims of electoral fraud, albeit he
attached affidavits of various witnesses in his protest. The affidavits, the COMELEC
First Division said, asserted, in one form or another, the electoral malfeasance or
misfeasance allegedly committed by the BET. In dismissing the arguments of Co for
his failure to present evidence, the COMELEC commented, "[I]t appears that
protestant-appellant [Co] rested on laurels after seeing the result of the physical
count of the revised ballots and the conclusion of the Technical Examination. In fine,
protestant-appellant proverbially lost the war for want of a nail."15
The fallo of the COMELEC First Division Resolution reads:
WHEREFORE, premises considered, the Commission (First Division) RESOLVED,
as it hereby RESOLVES, to DENY the protestants Appeal for LACK OF MERIT.

55

The Decision dated 04 May 2011 by Metropolitan Trial Court Branch 04 City of
Manila is hereby AFFIRMED.16
Co then filed a Motion for Reconsideration. In its assailed December 7, 2012
Resolution, the COMELEC En Banc17 reconsidered the August 23, 2011 Resolution
of the First Division, and accordingly declared Co as the duly elected punong
barangay. Vital to the En Bancs disposition is its finding that the ballots subjected to
revision were genuine. The En Banc found:
x x x [W]e find merit in appellants motion for reconsideration. For, protestant [Co]
has sufficiently established that no untoward incident had attended the preservation
of the ballots after the termination of the proceedings of the Board of Election Tellers
or from the time the custody of the ballot boxes is transferred from the BET to the
City Treasurer and finally to the trial court. Protestee who cried post-election fraud is
duty- bound to establish that the genuine ballots found inside the boxes were
compromised and tampered at any time during that period and before the revision.
However, no such proof has been adduced by protestee except the discrepancy
between the figures in the ERs and the physical count on revision. But then, said
discrepancy could have been caused by errors in the transposition of the numbers
from the ballots to the ERs during the canvassing and not due to tampering. As
earlier intimated, the discrepancy could be attributed to ER manipulation during the
canvassing and not because of the tampering of the ballots which were already found
by an expert and independent body to be genuine and authentic.18
The fallo of the COMELEC En Bancs Resolution reads:
WHEREFORE, premises considered, the Commission RESOLVED as it hereby
RESOLVES to reconsider its Resolution dated August 23, 2011 and proclaim
protestant-appellant as the duly elected Punong Barangay of Barangay 296, District
III, Manila.19
Thus, the present recourse, on the argument that the COMELEC En Banc committed
grave abuse of discretion amounting to lack or excess of jurisdiction when it
arbitrarily set aside the Decision of the MeTC and the Resolution of the COMELEC
First Division, in the choice between the revision results in the protested precincts
and the official vote count recorded in the election returns. Petitioner further argues
that the COMELEC gravely abused its discretion when it demanded from protestee
direct proof of actual tampering of ballots to justify consideration of the use of the
election returns in determining the winning candidate in the elections. In fine,
petitioner questions the ruling of the COMELEC giving precedence to the results of
the revision over the official canvassing results.
The Issues

I. WHETHER THE RESPONDENT COMMISSION COMMITTED GRAVE


ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION IN RULING THAT PRIVATE RESPONDENT CO HAD
SUCCESSFULLY DISCHARGED THE BURDEN OF PROVING THE
INTEGRITY OF THE BALLOTS SUBJECTED TO REVISION. II. WHETHER
THE RESPONDENT COMMISSION COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN
REVERSING THE RULING OF THE COMELEC FIRST DIVISION, TO THE
EFFECT THAT PETITIONER REGIO IS THE DULY-ELECTED PUNONG
BARANGAY.
The Courts Ruling
At the outset, it must be noted that the protest case is dismissible for being moot and
academic. A case becomes moot when there is no more actual controversy between
the parties or no useful purpose can be served in passing upon the merits. Generally,
courts will not determine a moot question in a case in which no practical relief can
be granted.20
In Malaluan v. COMELEC,21 this Court settled the matter on when an election
protest case becomes moot and academic:
When the appeal from a decision in an election case has already become moot, the
case being an election protest involving the office of mayor the term of which had
expired, the appeal is dismissible on that ground, unless the rendering of a decision
on the merits would be of practical value. (emphasis added)
In the case now before the Court, the position involved is that of a punong barangay.
The governing law, therefore, is Republic Act No. (RA) 9164, as amended by RA
9340. Sec. 4 of the law states:
Sec. 4. Assumption of Office. - The term of office of the barangay and sangguniang
kabataan officials elected under this Act shall commence on August 15, 2002, next
following their elections. The term of office of the barangay and sangguniang
kabataan officials elected in the October 2007 election and subsequent elections shall
commence at noon of November 30 next following their election. (emphasis added)
The court takes judicial notice of the holding of barangay elections last October 28,
2013. Following the elections, the new set of barangay officials already assumed
office as of noon of November 30, 2013. It goes without saying, then, that the term
of office of those who were elected during the October 2010 barangay elections also
expired by noon on November 30, 2013. In fine, with the election of a new punong
barangay during the October 28, 2013 elections, the issue of who the rightful winner

56

of the 2010 barangay elections has already been rendered moot and academic.
Notwithstanding the mootness of the case, We find the need to decide the petition on
its merits, in view of the finding of the COMELEC En Banc that protestant Co
should have been declared the winner for the post of punong barangay for the term
2010-2013. We find that the grave abuse of discretion committed by the COMELEC
En Banc, specifically in ignoring the rules on evidence, merits consideration. Still in
line with the Courts decision in Malaluan22 to the effect that the Court can decide
on the merits a moot protest if there is practical value in so doing, We find that the
nullification of the COMELEC En Bancs Resolution is in order, due to its gross
contravention of established rules on evidence in election protest cases. We shall
discuss the issues jointly, related as they are to the finding of the COMELEC En
Banc giving primacy to the results of the revision proceedings over the results of the
canvassing as reflected in the election returns.
The doctrine in Rosal v. COMELEC23 and considering the results of the revision
vis--vis the results reflected in the official canvassing In Rosal, this Court
summarized the standards to be observed in an election contest predicated on the
theory that the election returns do not accurately reflect the will of the voters due to
alleged irregularities in the appreciation and counting of ballots. These guiding
standards are:
(1) The ballots cannot be used to overturn the official count as reflected in the
election returns unless it is first shown affirmatively that the ballots have been
preserved with a care which precludes the opportunity of tampering and suspicion of
change, abstraction or substitution;
(2) The burden of proving that the integrity of the ballots has been preserved in such
a manner is on the protestant;
(3) Where a mode of preserving the ballots is enjoined by law, proof must be made
of such substantial compliance with the requirements of that mode as would provide
assurance that the ballots have been kept inviolate notwithstanding slight deviations
from the precise mode of achieving that end;

Rosal was promulgated precisely to honor the presumption of regularity in the


performance of official functions. Following Rosal, it is presumed that the BET and
Board of Canvassers had faithfully performed the solemn duty reposed unto them
during the day of the elections. Thus, primacy is given to the official results of the
canvassing, even in cases where there is a discrepancy between such results and the
results of the revision proceedings. It is only when the protestant has successfully
discharged the burden of proving that the re-counted ballots are the very same ones
counted during the revision proceedings, will the court or the Commission, as the
case may be, even consider the revision results. Even then, the results of the revision
will not automatically be given more weight over the official canvassing results or
the election returns. What happens in the event of discrepancy between the revision
results and the election returns is that the burden of proof shifts to the protestee to
provide evidence of actual tampering of the ballots, or at least a likelihood of
tampering. It is only when the court or the COMELEC is fully satisfied that the
ballots have been well preserved, and that there had been no tampering of the ballots,
that it will accord credibility to the results of the revision. In Varias v. COMELEC,
the Court said:
The Rosal ruling, to be sure, does not involve issues merely related to the
appreciation or calibration of evidence; its critical ruling is on the propriety of
relying on the revision of ballot results instead of the election returns in the
proclamation of a winning candidate. In deciding this issue, what it notably
established was a critical guide in arriving at its conclusion the need to determine
whether the court or the COMELEC looked at the correct considerations in making
its ruling.24 This Court had long stated that "[u]pholding the sovereignty of the
people is what democracy is all about. When the sovereignty of the people expressed
thru the ballot is at stake, it is not enough for this Court to make a statement but it
should do everything to have that sovereignty obeyed by all. Well done is always
better than well said."25

(4) It is only when the protestant has shown substantial compliance with the
provisions of law on the preservation of ballots that the burden of proving actual
tampering or likelihood thereof shifts to the protestee; and

This is really what the Rosal doctrine is all about. The Rosal doctrine ensures that in
election protest cases, the supreme mandate of the people is ultimately determined.
In laying down the rules in appreciating the conflicting results of the canvassing and
the results of a revision later made, the Court has no other intention but to determine
the will of the electorate. The Rosal doctrine is also supplemented by A.M. No. 07-415-SC,26 establishing the following disputable presumptions:

(5) Only if it appears to the satisfaction of the court of COMELEC that the integrity
of the ballots has been preserved should it adopt the result as shown by the recount
and not as reflected in the election returns. In the same case, the Court referred to
various provisions in the Omnibus Election Code providing for the safe-keeping and
preservation of the ballots, more specifically Secs. 160, 217, 219, and 220 of the
Code.

SEC. 6. Disputable presumptions. - The following presumptions are considered as


facts, unless contradicted and overcome by other evidence: (a) On the election
procedure: (1) The election of candidates was held on the date and time set and in the
polling place determined by the Commission on Elections; (2) The Boards of
Election Inspectors were duly constituted and organized; (3) Political parties and
candidates were duly represented by pollwatchers; (4) Pollwatchers were able to

57

perform their functions; and (5) The Minutes of Voting and Counting contains all the
incidents that transpired before the Board of Election Inspectors. (b) On election
paraphernalia: (1) Ballots and election returns that bear the security markings and
features prescribed by the Commission on Elections are genuine; (2) The data and
information supplied by the members of the Boards of Election Inspectors in the
accountable forms are true and correct; and (3) The allocation, packing and
distribution of election documents or paraphernalia were properly and timely done.
(c) On appreciation of ballots: (1) A ballot with appropriate security markings is
valid; (2) The ballot reflects the intent of the voter; (3) The ballot is properly
accomplished; (4) A voter personally prepared one ballot, except in the case of
assistors; and (5) The exercise of ones right to vote was voluntary and free.
Private respondent Co has not proved that the integrity of the ballots has been
preserved Applying Rosal, viewed in conjunction with A.M. No. 07-4-15-SC, this
Court rules that the COMELEC En Banc committed grave abuse of discretion in
ruling that private respondent had successfully discharged the burden of proving that
the ballots counted during the revision proceedings are the same ballots cast and
counted during the day of the elections. That is the essence of the second paragraph
in the Rosal doctrine. It is well to note that the respondent Co did not present any
testimonial evidence to prove that the election paraphernalia inside the protested
ballot boxes had been preserved. He mainly relied on the report of the revision
committee. There was no independent, direct or indirect, evidence to prove the
preservation of the ballots and other election paraphernalia. This leads Us to no other
conclusion but that respondent Co failed to discharge his burden under the Rosal
doctrine. With no independent evidence to speak of, respondent Co cannot simply
rely on the report of the revision committee, and from there conclude that the report
itself is proof of the preservation of the ballots. What he needs to provide is evidence
independent of the revision proceedings. Without any such evidence, the Court or the
COMELEC, as the case may be, will be constrained to honor the presumption
established in A.M. No. 07-4-15-SC, that the data and information supplied by the
members of the Boards of Election Inspectors in the accountable forms are true and
correct.
Respondent Co admits having, under the Rosal doctrine, the burden of proving the
preservation of the ballots, and corollarily, that their integrity have not been
compromised before the revision proceedings. He, however, argues that he had
successfully discharged that burden. And how? First, he pointed out that from the
moment the various BETs placed the counted official ballots inside the ballot boxes
until they were transported for canvassing, and until they were transmitted to the
Election Officer/City Treasurer of Manila for storage and custody, no irregularities or
ballot-box snatching were reported; neither was there any news or record of ballot
box tampering in the protested precincts. Second, no untoward incident or
irregularity which may taint or affect the integrity of the ballot boxes was ever
reported when they were transported to the storage area of the trial court. Third, the

storage place of the ballot boxes was at all times tightly secured, properly protected,
and well safeguarded. Fourth, all the protested ballot boxes were properly locked and
sealed. Fifth, the petitioner never questioned or raised any issue on the preservation
of the integrity of the protested ballot boxes. And sixth, the Technical Examination
Report signed by the COMELEC representative confirmed the genuineness,
authenticity, and integrity of all the ballots found during the revision.27
We hold, however, that the foregoing statements do not, by themselves, constitute
sufficient evidence that the ballots have been preserved. Respondent Co cannot
simply rely on the alleged absence of evidence of reports of untoward incidents, and
from there immediately conclude that the ballots have been preserved. What he
should have presented are concrete pieces of evidence, independent of the revision
proceedings that will tend to show that the ballots counted during the revision
proceedings were the very same ones counted by the BETs during the elections, and
the very same ones cast by the public. He cannot evade his duty by simply relying on
the absence of reports of untoward incidents that happened to the ballot boxes. At
best, this reliance on the condition of the ballot boxes themselves is speculative; at
worst, it is self-serving. Without presenting to the court any evidence outside of the
proceedings, respondent Co as protestant may simply claim that the ballot boxes
themselves are the proof that they were properly preserved. This goes contrary to the
doctrine in Rosal.
The respective custodians of the ballot boxes, from the time they were used in the
elections until they were delivered to the court, were not, to stress, presented in
court. They could have testified as to the security afforded the ballot boxes while in
their custody. Moreover, no witness at all was presented by respondent Co during the
proceedings in the trial court. The Court reminds respondent Co that the trial courts
consideration of the case is confined to whatever evidence is presented before it. This
is amply stated in Rule 13, Sec. 2 of A.M. No. 07-4-15-SC:
Sec. 2. Offer of evidence. The court shall consider no evidence that has not been
formally offered. Offer of evidence shall be done orally on the last day of hearing
allowed for each party after the presentation of the last witness. The opposing party
shall be required to immediately interpose objections thereto. The court shall rule on
the offer of evidence in open court. However, the court may, at its discretion, allow
the party to make an offer of evidence in writing, which shall be submitted within
three days. If the court rejects any evidence offered, the party may make a tender of
excluded evidence.
Unfortunately for respondent Co, the witnesses whose affidavits he attached to his
Protest were never presented during trial. While he again raised the tenor of these
affidavits in his Comment filed before Us, those cannot be considered anymore due
to his failure to present them before the trial court. Respondent cannot simplistically
insist on the consideration of said affidavits, the trial court not having been given the

58

opportunity to observe their testimonies, and petitioner not having been accorded the
opportunity to cross-examine them. The fact that respondent attached the affidavits
in his Protest does not mean that the trial court is bound to consider them, precisely
because they have not been formally offered before the court. The attachments to the
Protest will not be considered unless formally offered. The Court notes that
respondent Co has offered no explanation whatsoever why he failed to present his
witnesses. Nevertheless, he would have this Court consider as evidence their
purported testimonies. This would be incongruously unfair to petitioner, who
endeavored to prove his case by presenting evidence before the trial court. Neither
can respondent Co disclaim responsibility on the argument that the petitioner never
raised as an issue the preservation of the ballot boxes. Inherent in all election protest
cases is the duty of the protestant to provide evidence of such preservation. The
failure of the protestee to raise that as an issue will not ipso facto mean that
protestant need not present evidence to that effect. Moreover, the Technical
Examination Report, is not, without more, evidence of preservation. The Report
merely states that the ballots are genuine. What the protestant should endeavor to
prove, however, in presenting evidence of preservation, is not that the ballots
themselves are genuine or official, but that they are the very same ones cast by the
electorate. The Report cannot possibly determine that. While it may be that the
ballots themselves are official ballots, there is still a dearth of evidence on whether or
not they were the same official ballots cast by the public during the elections. The
Report, therefore, cannot be considered as evidence of the preservation, as required
by Rosal. The fact of preservation is not, as respondent Co claims,
"incontrovertible." In fact, there is total absence of evidence to that effect. The
incontrovertible fact is that private respondent, during the proceedings before the
trial court, did not present any independent evidence to prove his claim. Without any
independent evidence, the trial court, the COMELEC, as well as this Court, is
constrained to affirm as a fact the disputable presumption that the ballots were
properly counted during the counting and canvassing of votes. In sum, We find that
the COMELEC gravely abused its discretion in ruling that private respondent had
Republic of the Philippines
SUPREME COURT
Manila

discharged the burden of proving the integrity of the ballots. We rule, on the contrary,
that there is utter lack of evidence to that effect.
Petitioner need not prove actual tampering of the ballots Corollarily, the COMELEC
En Banc had ruled that petitioner, as protestee, failed to adduce evidence that the
ballots found inside the ballot boxes were compromised and tampered. This strikes
us as baseless and a clear departure from the teachings of Rosal.
The duty of the protestee in an election contest to provide evidence of actual
tampering or any likelihood arises only when the protestant has first successfully
discharge the burden or providing that the ballots have been secured to prevent
tampering or susceptibility of charge, abstraction or substitution. Such need to
present proof of tampering did not arise since protestant himself failed to provide
evidence of the integrity of the ballots.
A candidate for a public elective position ought to familiarize himself with election
laws, pertinent jurisprudence, and COMELEC resolutions, rules and regulations.
Alternatively, he should have an experienced and knowledgeable election lawyer to
guide him on the different aspects of election. Sans comment legal advice and
representation a victory in the elections may turn out to be a crushing defeat for the
candidate who actually got the nod of the electorate. Unfortunately for respondent
Co, he committed several miscues that eventually led to his debacle in the instant
election protest.
WHEREFORE, premises considered, this Petition for Certiorari is GRANTED. The
Resolution dated December 7, 2012 of the COMELEC En Banc in EAC (BRGY-SK)
No. 161-2011 is hereby NULLIFIED and SET ASIDE. The Resolution of the
COMELEC First Division dated August 23, 2011, affirming the Decision in Election
Case No. 02480-EC of the MeTC. Branch 4 in Manila is hereby REINSTATED.
SO ORDERED.
MAGNAYON, ROSARIO ELEP, MA. ANTONIO REBUENO, JOSE RIVERA, M.
SAPALICIO and G. ROJAS, petitioners,
vs.
COMMISSION ON AUDIT, respondent.

EN BANC
Office of the Legal Counsel for petitioners.
The Solicitor General for respondent.
G.R. No. L-107016 March 11, 1994
DEVELOPMENT BANK OF THE PHILIPPINES, VIVENCIO MACAPAGAL,
ALFREDO CASAL, EDUARDO MENDOZA, ADORACION GARCIA, RODEL

BIDIN, J.:

59

This petition for certiorari seeks the reversal of the May 13, 1992 decision of
respondent Commission on Audit (COA) disallowing the amount of P246,539.25
representing payment of customs duties and taxes for one (1) unit of KVA
Uninterruptible Power Supply (UPS) purchased by petitioner Development Bank of
the Philippines (DBP) at a public bidding conducted by DBP itself.
On September 13, 1988 the Procurement Committee of DBP conducted a public
bidding for one (1) unit of Uninterruptible Power Supply (UPS). Of the eight (8)
suppliers who participated in the bidding, four (4) were disqualified outright for
failure to submit the required bidder's bond. The remaining four (4) bidders were
subjected to an evaluation process under the "must" criteria to determine whether the
unit offered by the bidders complies with DBP's specifications. Under this evaluation
process, only two (2) bidders qualified, namely: Paris-Manila Trading Corporation
(Paris-Manila), and Voltronics Industrial Corporation (Voltronics). These bidders
were further evaluated under the "wants" category which has the following criteria:
(a) delivery time; (b) maintenance strategy; (c) cost; (d) manufacture support; and (e)
company profile. Under this category, Paris-Manila got a rating of 75.02% while
Voltronics got a rating of 78.75%. With respect to the amount of bids, Paris-Manila
offered a bid in the amount of P2,493,000.00; Voltronics, on the other hand, offered
P1,190,000.00 exclusive of customs duties and taxes at P246,539.25 or a total bid
price of P1,436,539.25.
On the basis of a thorough evaluation conducted, the Special Technical Committee
recommended to the DBP Vice Chairman that the UPS be purchased from Voltronics.
In this connection, DBP submitted all the bidding documents to the Corporate
Auditor for pre-audit pursuant to COA Circular No. 86-257. After a review of the
documents, then Corporate Auditor Elisa C. Gervasio issued a reply finding the
subject transaction to be "in order" but with a corresponding observation regarding
customs duties and taxes to wit:
In our review of bidding documents for the purchase of one (1) unit Uninterruptible
Power Supply System, we found the proposed Purchase Order No. 137 dated
October 14, 1988 in order. We would like to invite your attention, however, for (sic)
the lack of additional provisions on the terms and conditions in the DBP Bid Form
for customs duties and taxes for purchases of this kind. It is suggested that in future
biddings, the quotation or bid price should always mean the total price to be paid by
DBP including customs duties and/or other charges (Rollo, p. 42).
Thereafter, DBP issued Purchase Order No. 0137 to Voltronics at the adjusted price,
i.e., P1,436,539.25 inclusive of customs duties and taxes.
In the meantime, COA Circular No. 89-299 was passed lifting the pre-audit of
government transactions. A new Corporate Auditor was also assigned to petitioner
DBP.

After a post-audit, the new Corporate Auditor sent an "Auditor's Notice to Person's
Liable" to the Chairman of DBP notifying him of the disallowance of the amount of
P246,539.25 representing customs duties and taxes and at the same time holding
him, along with the other petitioners herein, jointly and severally liable for the
aforesaid sum. DBP moved for reconsideration in a letter-clarification dated
November 2, 1990 but the same was denied. On appeal, the Commission en banc
affirmed the disallowance.
In this petition, petitioner claims that:
I RESPONDENT COMMISSION ERRED IN APPLYING THE POST-AUDIT
SYSTEM UNDER COA CIRCULAR NO. 89-299 CONSIDERING THAT AT THE
TIME OF THE QUESTIONED BIDDING THE "LAW" IN FORCE WAS COA
CIRCULAR NO. 86-257
II RESPONDENT COMMISSION IS ESTOPPED FROM IMPUGNING THE
DECISION OF ITS DULY CONSTITUTED REPRESENTATIVE EXERCISED IN
THE ORDINARY COURSE OF ITS FUNCTION
III RESPONDENT COMMISSION MISAPPRECIATED FACTS WHICH HAD
THEY BEEN PROPERLY APPRECIATED WOULD HAVE ALTERED ITS
DECISION
The pivotal issue in this case hinges on whether or not the disallowance of the
payment made by DBP representing customs duties and taxes is valid.
Petitioners submit the contrary on the ground that the transaction in question had
already been approved and passed in audit in accordance with the pre-audit system
then obtaining and the later circular requiring post-audit should not be applied
retroactively.
While it is true that the applicable procedure in force at the time of the questioned
transaction was COA Circular 86-257 requiring a pre-audit, there is nothing to
preclude respondent COA from conducting a post-audit of the already pre-audited
transaction. As pointed out by the Solicitor General:
A pre-audit is an examination of financial transactions before their consumption or
payment and is basically a special development of the control aspect of accountancy
as well as an integral part of the accounting and payment process. Thus, pre-audit
seeks to determine that:
1. The proposed expenditure complies with an appropriation law or other specific
statutory authority;

60

2. Sufficient funds are available for the purpose;


3. The proposed expenditure is not unreasonable or extravagant and the unexpended
balance of appropriations where it will be charged to is sufficient to cover the entire
amount thereof; and
4. The transaction is approved by proper authority and the claim is duly supported by
authentic underlying evidences (COA Journal, August 1976, p. 8) (Rollo, p. 69).
Besides, the favorable action of the then Corporate Auditor as regards the transaction
does not necessarily mean that the same was passed in audit. Circular 86-57
provides:
V. DUTIES AND RESPONSIBILITIES OF COA OFFICIALS AND
REPRESENTATIVES
The head of the audit unit shall:
3. Act on the transaction subject to pre-audit within twenty-four (24) hours from
receipt by his Office of the pertinent vouchers/documents. The action herein required
does not necessarily mean approval or allowing in audit.
More importantly, Article IX (D) Section 2(1) of the Constitution expressly grants
respondent Commission the power to conduct a post-audit, to wit:
Sec. 2. (1) The Commission on Audit shall have the power, authority, and duty to
examine, audit, and settle all accounts pertaining to the revenue and receipts of, and
expenditures or uses of funds and property, owned or held in trust by, or pertaining
to, the Government, or any of its subdivisions, agencies, or instrumentalities,
including government-owned or controlled corporations with original charters, and
on a post-audit basis: (a) constitutional bodies, commissions and offices that have
been granted fiscal autonomy under this Constitution; (b) autonomous state colleges
and universities; (c) other government-owned or controlled corporations and their
subsidiaries; and (d) such non-governmental entities receiving subsidy or equity,
directly or indirectly, from or through the Government, which are required by law or
the granting institution to submit to such audit as a condition of subsidy or equity . . .
(emphasis supplied).
DBP is no doubt a government corporation and the question of whether COA
Circular 86-299 was retroactively applied to the subject transaction is thus of no
moment. To begin with, there was never any retroactive application of post-audit.
Regardless of the result of the pre-audit, it cannot be denied that respondent COA is
so empowered to conduct a post-audit.

It is thus erroneous for DBP to claim that respondent Commission is estopped from
questioning, in the process of post-audit, the previous acts of its officials. Further,
well-settled is the principle that estoppel does not lie against the government (Cruz,
Jr. vs. Court of Appeals, 194 SCRA 145 [1991]; Republic vs. Court of Appeals, 182
SCRA 290 [1990]), more so if they are erroneous, let alone irregular (Republic vs.
Intermediate Appellate Court, 209 SCRA 90 [1992]; Sharp International Marketing
vs. Court of Appeals, 201 SCRA 299 [991]).
As to whether or not the result of the post-audit is proper, in this case the
disallowance of the customs duties and taxes, is another matter altogether.
In the Notice to Persons Liable, the Corporate Auditor disallowed the payment of
customs duties since "there was no quotation on this regard and to include this
further would improve the bid after the opening which privilege was not given to
other bidders" (Rollo, p. 43). On its face, it would appear that the Auditor's reason
aforequoted was based on the presumption that petitioner DBP had no knowledge
whatsoever that the price quoted by Voltronics did not include customs duties and
taxes, i.e., there was no disclosure of such fact by Voltronics at the time of the
bidding. In fact, the question of whether or not Voltronics so informed petitioner
DBP of the non-inclusion of customs duties and taxes in its bid became the thrust of
both petitioner DBP and respondent COA's pleadings submitted before this Court.
DBP maintains that it was so informed by Voltronics in a letter dated September 12,
1988 along with the bid form that its quotation did not include the customs duties
and taxes. Petitioner DBP insists that subsequent communications even made
reference to this letter. On the other hand, respondent COA claims that there was no
such attachment to the bid form and if there was any, the form would have so stated.
Since there was no mention anywhere in the bid form of Voltronics or the Abstract of
Bids as to any attachment, respondent COA concludes that no September 12, 1988
letter was appended thereto.
In the light of all these contentions, it is difficult to determine with utmost certainty
the truth as to the existence of the September 12, 1988 letter at the time of or even
prior to the opening of the bids. However, inasmuch as this is a question of fact
involving an occurrence where DBP itself participated as the party conducting the
bidding, the presumption lies in favor of the latter that such a letter did exist
informing if that the quoted bid of Voltronics excluded customs duties and taxes.
Bolstering this position is a November 14, 1990 letter of the Senior Vice President of
DBP for Operations addressed to the Corporate Auditor confirming the fact that
"Supplementary to the Bid Form submitted by Voltronics Industrial Corp. (winning
bidder) is a letter dated September 12, 1988 (Annex C) specifically mentioning that
its bid of P1,190,000.00 does not include customs duties and taxes (Rollo, p. 44;
emphasis supplied). But even without the contested letter, it cannot be denied that

61

Voltronics did specify in its bid "DUTIES AND TAXES NOT INCLUDED" (Rollo,
p. 25). This alone would suffice to sustain the claim that DBP was well aware of
Voltronics' bid to be exclusive of the aforesaid charges.
In this regard, the notice of disallowance which states: "(w)hen Voltronics offered the
amount of P1,190,000.00, it is understood that said amount represents the total cost
to paid (sic) by DBP upon delivery of the item, i.e., taxes/customs duty, handling
costs" (Rollo, p. 43) deserves scant consideration. It was based merely on the
presumption that the bidders had prior understanding of what the "total" bid price
should comprise, when in truth there was no clear-cut definition of the term
conveyed to the participating bidders. In fact, such lack of prior understanding
compelled the former Corporate Auditor, who, after pre-auditing the questioned
transaction, suggested that "in future biddings, the quotation or bid price should
always mean the total price to be paid by DBP including customs duties and/or other
charges" (Rollo, p. 42). Surely, the former Corporate Auditor would not have found
the need to define in clearer terms what "total bid price" should refer to if it was
already a settled concept to begin with.
Neither can we subscribe to the argument of respondent COA that the allowance of
the questioned amount would be tantamount to granting a privilege to Voltronics
which was not accorded to the other bidders. As far as the use of the term "privilege"
is concerned, it would be well to point out that no such privilege was accorded to
Voltronics. The then Corporate Auditor was well aware of the non-inclusion of duties
and taxes relative to the purchase of the UPS. This notwithstanding, she found the
Purchase Order to be in order knowing that even if the duties and taxes amounting to
P246,539.25 were to be added to the bid price of P1,190,000.00, the total selling
price would still be lower by more than a million pesos than the selling price offered
EN BANC

by Paris-Manila. Based on the above computation and in so allowing the payment of


P246,539.25, representing custom duties and taxes, no undue advantage could be
said to have been awarded to Voltronics. And as far as Voltronics is concerned, there
is no doubt that it acted in good faith. Secondly, Voltronics came out as the winner of
the bidding only after undergoing the evaluation process required by petitioner DBP.
Hence, the amount of the bid was not the only consideration for choosing Voltronics
as the winning bidder. It also ranked higher than Paris-Manila under the "wants"
criteria with a rating of 78.75%. Thirdly, even if the same "privilege" of "improving"
its bid after the same has been opened were accorded to the so-called "other" bidders,
only Paris-Manila would qualify as the "other" bidder(s) since it was the only one
aside from Voltronics which qualified under the "must" criteria, the final stage of the
evaluation process. All the rest were either immediately disqualified or did not meet
the standards of the aforesaid criteria. Thus, even if Paris-Manila were afforded the
opportunity to improve its bid, considering the disparity of its bid with Voltronics'
bid of P1,436,539.25, inclusive of duties and taxes, the latter would still be the
lowest bidder.
In other words, the alleged "privilege" had little effect on the ultimate outcome of the
bidding. Inasmuch as neither Paris-Manila nor petitioner DBP was prejudiced by
allowing the exclusion of the customs duties and taxes to the total bid price, the
result of the pre-audit should be allowed to stand.
WHEREFORE, the petition is GRANTED. The decision of respondent COA dated
May 13, 1992 is hereby REVERSED and SET ASIDE. Respondent COA is hereby
DIRECTED to allow in post-audit the payment of P246,539.25.
SO ORDERED.
PUNO,* C.J.,
QUISUMBING,**
YNARES-SANTIAGO,

2nd LT. SALVADOR PARREO represented by his daughter Myrna P. Caintic,

SANDOVAL-GUTIERREZ,

Petitioner,

CARPIO,
AUSTRIA-MARTINEZ,

G.R. No. 162224

CORONA,
- versus - CARPIO MORALES,

Present:

AZCUNA,

62

TINGA,
CHICO-NAZARIO,

The Antecedent Facts

GARCIA,
VELASCO, JR., and
NACHURA, JJ.

Salvador Parreo (petitioner) served in the Armed Forces of the Philippines (AFP) for
32 years. On 5 January 1982, petitioner retired from the Philippine Constabulary
with the rank of 2nd Lieutenant. Petitioner availed, and received payment, of a lump
sum pension equivalent to three years pay. In 1985, petitioner started receiving his
monthly pension amounting to P13,680.

COMMISSION ON AUDIT and Promulgated:


CHIEF OF STAFF, ARMED
FORCES OF THE PHILIPPINES,
Respondents. June 7, 2007
x---------------------------------------------------x

Petitioner migrated to Hawaii and became a naturalized American citizen. In January


2001, the AFP stopped petitioners monthly pension in accordance with Section 27 of
Presidential Decree No. 1638[4] (PD 1638), as amended by Presidential Decree No.
1650.[5] Section 27 of PD 1638, as amended, provides that a retiree who loses his
Filipino citizenship shall be removed from the retired list and his retirement benefits
terminated upon loss of Filipino citizenship. Petitioner requested for reconsideration
but the Judge Advocate General of the AFP denied the request.

Petitioner filed a claim before the COA for the continuance of his monthly pension.
DECISION
The Ruling of the Commission on Audit
CARPIO, J.:

The Case

Before the Court is a petition for certiorari[1] assailing the 9 January 2003
Decision[2] and 13 January 2004 Resolution[3] of the Commission on Audit (COA).

In its 9 January 2003 Decision, the COA denied petitioners claim for lack of
jurisdiction. The COA ruled:
It becomes immediately noticeable that the resolution of the issue at hand hinges
upon the validity of Section 27 of P.D. No. 1638, as amended. Pursuant to the
mandate of the Constitution, whenever a dispute involves the validity of laws, the
courts, as guardians of the Constitution, have the inherent authority to determine
whether a statute enacted by the legislature transcends the limit imposed by the
fundamental law. Where the statute violates the Constitution, it is not only the right
but the duty of the judiciary to declare such act as unconstitutional and void. (Tatad
vs. Secretary of Department of Energy, 281 SCRA 330) That being so, prudence

63

dictates that this Commission defer to the authority and jurisdiction of the judiciary
to rule in the first instance upon the constitutionality of the provision in question.
1.
Premises considered, the request is denied for lack of jurisdiction to adjudicate the
same. Claimant is advised to file his claim with the proper court of original
jurisdiction.[6]

2. Whether the COA has jurisdiction to rule on the constitutionality of Section 27


of PD 1638, as amended; and

3.
Petitioner filed a motion for reconsideration. Petitioner alleged that the COA has the
power and authority to incidentally rule on the constitutionality of Section 27 of PD
1638, as amended. Petitioner alleged that a direct recourse to the court would be
dismissed for failure to exhaust administrative remedies. Petitioner further alleged
that since his monthly pension involves government funds, the reason for the
termination of the pension is subject to COAs authority and jurisdiction.
In its 13 January 2004 Resolution, the COA denied the motion. The COA ruled that
the doctrine of exhaustion of administrative remedies does not apply if the
administrative body has, in the first place, no jurisdiction over the case. The COA
further ruled that even if it assumed jurisdiction over the claim, petitioners
entitlement to the retirement benefits he was previously receiving must necessarily
cease upon the loss of his Filipino citizenship in accordance with Section 27 of PD
1638, as amended.

Hence, the petition before this Court.

The Issues

Whether Section 27 of PD 1638, as amended, is constitutional;

Whether PD 1638, as amended, has retroactive or prospective effect.[7]

The Ruling of this Court

The petition has no merit.

Jurisdiction of the COA

Petitioner filed his money claim before the COA. A money claim is a demand for
payment of a sum of money, reimbursement or compensation arising from law or
contract due from or owing to a government agency.[8] Under Commonwealth Act
No. 327,[9] as amended by Presidential Decree No. 1445,[10] money claims against
the government shall be filed before the COA.[11]
Section 2(1), Article IX(D) of the 1987 Constitution prescribes the powers of the
COA, as follows:

Petitioner raises the following issues:

64

Sec. 2. (1) The Commission on Audit shall have the power, authority, and duty to
examine, audit, and settle all accounts pertaining to the revenue and receipts of, and
expenditures or uses of funds and property, owned or held in trust by, or pertaining
to, the Government, or any of its subdivisions, agencies, or instrumentalities,
including government-owned or controlled corporations with original charters, and
on a post-audit basis; (a) constitutional bodies, commissions and offices that have
been granted fiscal autonomy under this Constitution; (b) autonomous state colleges
and universities; (c) other government-owned or controlled corporations and their
subsidiaries; and (d) such non-governmental entities receiving subsidy or equity,
directly or indirectly, from or through the Government, which are required by law or
the granting institution to submit such audit as a condition of subsidy or equity.
However, where the internal control system of the audited agencies is inadequate, the
Commission may adopt such measures, including temporary or special pre-audit, as
are necessary and appropriate to correct the deficiencies. It shall keep the general
accounts of the Government and, for such period as may be provided by law,
preserve the vouchers and other supporting papers pertaining thereto.

The jurisdiction of the COA over money claims against the government does not
include the power to rule on the constitutionality or validity of laws. The 1987
Constitution vests the power of judicial review or the power to declare
unconstitutional a law, treaty, international or executive agreement, presidential
decree, order, instruction, ordinance, or regulation in this Court and in all Regional
Trial Courts.[12] Petitioners money claim essentially involved the constitutionality
of Section 27 of PD 1638, as amended. Hence, the COA did not commit grave abuse
of discretion in dismissing petitioners money claim.

Petitioner submits that the COA has the authority to order the restoration of his
pension even without ruling on the constitutionality of Section 27 of PD 1638, as
amended. The COA actually ruled on the matter in its 13 January 2004 Resolution,
thus:

Furthermore, assuming arguendo that this Commission assumed jurisdiction over the
instant case, claimants entitlement to the retirement benefits he was previously
receiving must necessarily be severed or stopped upon the loss of his Filipino
citizenship as prescribed in Section 27, P.D. No. 1638, as amended by P.D. No. 1650.
[13]

The COA effectively denied petitioners claim because of the loss of his Filipino
citizenship.

Application of PD 1638, as amended

Petitioner alleges that PD 1638, as amended, should apply prospectively. The Office
of the Solicitor General (OSG) agrees with petitioner. The OSG argues that PD 1638,
as amended, should apply only to those who joined the military service after its
effectivity, citing Sections 33 and 35, thus:

Section 33. Nothing in this Decree shall be construed in any manner to reduce
whatever retirement and separation pay or gratuity or other monetary benefits which
any person is heretofore receiving or is entitled to receive under the provisions of
existing law.

xxxx

Section. 35. Except those necessary to give effect to the provisions of this Decree
and to preserve the rights granted to retired or separated military personnel, all laws,
rules and regulations inconsistent with the provisions of this Decree are hereby
repealed or modified accordingly.

The OSG further argues that retirement laws are liberally construed in favor of the
retirees. Article 4 of the Civil Code provides: Laws shall have no retroactive effect,
unless the contrary is provided. Section 36 of PD 1638, as amended, provides that it
shall take effect upon its approval. It was signed on 10 September 1979. PD 1638, as
amended, does not provide for its retroactive application. There is no question that
PD 1638, as amended, applies prospectively.

65

However, we do not agree with the interpretation of petitioner and the OSG that PD
1638, as amended, should apply only to those who joined the military after its
effectivity. Since PD 1638, as amended, is about the new system of retirement and
separation from service of military personnel, it should apply to those who were in
the service at the time of its approval. In fact, Section 2 of PD 1638, as amended,
provides that th[e] Decree shall apply to all military personnel in the service of the
Armed Forces of the Philippines. PD 1638, as amended, was signed on 10 September
1979. Petitioner retired in 1982, long after the approval of PD 1638, as amended.
Hence, the provisions of PD 1638, as amended, apply to petitioner.

Petitioner Has No Vested Right to his

Further, the retirement benefits of military personnel are purely gratuitous in nature.
They are not similar to pension plans where employee participation is mandatory,
hence, the employees have contractual or vested rights in the pension which forms
part of the compensation.[17]
Constitutionality of Section 27 of PD 1638

Section 27 of PD 1638, as amended, provides:

Section 27. Military personnel retired under Sections 4, 5, 10, 11 and 12 shall be
carried in the retired list of the Armed Forces of the Philippines. The name of a
retiree who loses his Filipino citizenship shall be removed from the retired list and
his retirement benefits terminated upon such loss.

Retirement Benefits

Petitioner alleges that Section 27 of PD 1638, as amended, deprives him of his


property which the Constitution and statutes vest in him. Petitioner alleges that his
pension, being a property vested by the Constitution, cannot be removed or taken
from him just because he became a naturalized American citizen. Petitioner further
alleges that the termination of his monthly pension is a penalty equivalent to
deprivation of his life.

The allegations have no merit. PD 1638, as amended, does not impair any vested
right or interest of petitioner. Where the employee retires and meets the eligibility
requirements, he acquires a vested right to the benefits that is protected by the due
process clause.[14] At the time of the approval of PD 1638 and at the time of its
amendment, petitioner was still in active service. Hence, petitioners retirement
benefits were only future benefits and did not constitute a vested right. Before a right
to retirement benefits or pension vests in an employee, he must have met the stated
conditions of eligibility with respect to the nature of employment, age, and length of
service.[15] It is only upon retirement that military personnel acquire a vested right
to retirement benefits. Retirees enjoy a protected property interest whenever they
acquire a right to immediate payment under pre-existing law.[16]

The OSG agrees with petitioner that Section 27 of PD 1638, as amended, is


unconstitutional. The OSG argues that the obligation imposed on petitioner to retain
his Filipino citizenship as a condition for him to remain in the AFP retired list and
receive his retirement benefit is contrary to public policy and welfare, oppressive,
discriminatory, and violative of the due process clause of the Constitution. The OSG
argues that the retirement law is in the nature of a contract between the government
and its employees. The OSG further argues that Section 27 of PD 1638, as amended,
discriminates against AFP retirees who have changed their nationality.

We do not agree.

The constitutional right to equal protection of the laws is not absolute but is subject
to reasonable classification.[18] To be reasonable, the classification (a) must be
based on substantial distinctions which make real differences; (b) must be germane
to the purpose of the law; (c) must not be limited to existing conditions only; and (d)
must apply equally to each member of the class.[19]

66

There is compliance with all these conditions. There is a substantial difference


between retirees who are citizens of the Philippines and retirees who lost their
Filipino citizenship by naturalization in another country, such as petitioner in the
case before us. The constitutional right of the state to require all citizens to render
personal and military service[20] necessarily includes not only private citizens but
also citizens who have retired from military service. A retiree who had lost his
Filipino citizenship already renounced his allegiance to the state. Thus, he may no
longer be compelled by the state to render compulsory military service when the
need arises. Petitioners loss of Filipino citizenship constitutes a substantial
distinction that distinguishes him from other retirees who retain their Filipino
citizenship. If the groupings are characterized by substantial distinctions that make
real differences, one class may be treated and regulated differently from another.[21]

Republic Act No. 7077[22] (RA 7077) affirmed the constitutional right of the state to
a Citizen Armed Forces. Section 11 of RA 7077 provides that citizen soldiers or
reservists include ex-servicemen and retired officers of the AFP. Hence, even when a
retiree is no longer in the active service, he is still a part of the Citizen Armed Forces.
Thus, we do not find the requirement imposed by Section 27 of PD 1638, as
amended, oppressive, discriminatory, or contrary to public policy. The state has the
right to impose a reasonable condition that is necessary for national defense. To rule
otherwise would be detrimental to the interest of the state.

There was no denial of due process in this case. When petitioner lost his Filipino
citizenship, the AFP had no choice but to stop his monthly pension in accordance
with Section 27 of PD 1638, as amended. Petitioner had the opportunity to contest
the termination of his pension when he requested for reconsideration of the removal
of his name from the list of retirees and the termination of his pension. The Judge
Advocate General denied the request pursuant to Section 27 of PD 1638, as
amended.

Petitioner argues that he can reacquire his Filipino citizenship under Republic Act
No. 9225[23] (RA 9225), in which case he will still be considered a natural-born
Filipino. However, petitioner alleges that if he reacquires his Filipino citizenship
under RA 9225, he will still not be entitled to his pension because of its prior
termination. This situation is speculative. In the first place, petitioner has not shown
that he has any intention of reacquiring, or has done anything to reacquire, his

Filipino citizenship. Secondly, in response to the request for opinion of then AFP
Chief of Staff, General Efren L. Abu, the Department of Justice (DOJ) issued DOJ
Opinion No. 12, series of 2005, dated 19 January 2005, thus:

[T]he AFP uniformed personnel retirees, having re-acquired Philippine citizenship


pursuant to R.A. No. 9225 and its IRR, are entitled to pension and gratuity benefits
reckoned from the date they have taken their oath of allegiance to the Republic of the
Philippines. It goes without saying that these retirees have no right to receive such
pension benefits during the time that they have ceased to be Filipinos pursuant to the
aforequoted P.D. No. 1638, as amended, and any payment made to them should be
returned to the AFP. x x x.[24]

Hence, petitioner has other recourse if he desires to continue receiving his monthly
pension. Just recently, in AASJS Member-Hector Gumangan Calilung v. Simeon
Datumanong,[25] this Court upheld the constitutionality of RA 9225. If petitioner
reacquires his Filipino citizenship, he will even recover his natural-born citizenship.
[26] In Tabasa v. Court of Appeals,[27] this Court reiterated that [t]he repatriation of
the former Filipino will allow him to recover his natural-born citizenship x x x.

Petitioner will be entitled to receive his monthly pension should he reacquire his
Filipino citizenship since he will again be entitled to the benefits and privileges of
Filipino citizenship reckoned from the time of his reacquisition of Filipino
citizenship. There is no legal obstacle to the resumption of his retirement benefits
from the time he complies again with the condition of the law, that is, he can receive
his retirement benefits provided he is a Filipino citizen.

We acknowledge the service rendered to the country by petitioner and those similarly
situated. However, petitioner failed to overcome the presumption of constitutionality
of Section 27 of PD 1638, as amended. Unless the provision is amended or repealed
in the future, the AFP has to apply Section 27 of PD 1638, as amended.

WHEREFORE, we DISMISS the petition. We AFFIRM the 9 January 2003 Decision


and 13 January 2004 Resolution of the Commission on Audit.

67

SO ORDERED.
Today is Tuesday, August 18, 2015

Contract Amount
Working Days

Republic of the Philippines


SUPREME COURT
Manila

June, 1982

SECOND DIVISION

P 2,800.00

G.R. No. 76044 June 28, 1988


ATTY. PRAXEDIO P. DINGCONG, petitioner,
vs.
HON. TEOFISTO T. GUINGONA, JR., Chairman, B. C. FERNANDEZ, JR., and
COMMISSIONER EUFEMIO C. DOMINGO Commissioner, COMMISSION ON
AUDIT Quezon City, respondents.

MELENCIO-HERRERA, J.:
An appeal on certiorari seeking to annul and set aside the decision of respondent
Commission on Audit (COA) in its 7th Indorsement of 1 September 1986
disallowing petitioner's claim for reimbursement of payments he had advanced for
services rendered on "pakyao" basis in the renovation and improvement of the office
of the Bureau of Treasury, Iloilo City.
Petitioner, Atty. Praxedio P. Dingcong, was the former Acting Regional Director of
Regional Office No. VI of the Bureau of Treasury in Iloilo City, until his retirement
on 17 January 1984.
On three occasionsJune 1982, September 1982 and February 1983petitioner,
after public bidding, contracted, admittedly on an "emergency labor basis," the
services of one Rameses Layson, a private carpenter and electrician on "pakyao"
basis for the renovation and improvement of the Bureau of Treasury Office, Iloilo
City. Layson submitted the lowest bids so that the contracts were awarded to him, as
follows:
Dates

17 days
Sept., 1982
2,980.00
44 days
February 1983
2 522 00
35 days
Total
P 8,302.00

Subsequently, Layson was hired as a casual employee in the Bureau of Treasury


Office in order to do away with the hiring of a private carpenter and electrician.

68

When petitioner retired on 17 January 1984, among the items disallowed by the
Resident Auditor was the amount of P6,574.00 from the labor contracts with Layson,
by reducing the latter's daily rate from P40.00 per day to P18.00 daily.
Petitioner appealed to the Chairman of the Commission on Audit, who affirmed
the disallowance as being "excessive and disadvantageous to the government," but
increased Layson's daily rate to P25.00 thereby reducing the total amount disallowed
to P4,276.00. Despite petitioner's request for reconsideration, respondent
Commission remained unmoved, hence, the instant appeal.
On 8 April 1987, we resolved to give due course to the petition and required the
parties to submit their respective memoranda, which they have done.
Petitioner assails the disallowance as invalid for being a usurpation of a
management function and an impairment of contract.
We reject petitioner's submission.
Not only is the Commission on Audit (COA) vested with the power and authority,
but it is also charged with the duty, to examine, audit and settle all accounts
pertaining to ... the expenditures or uses of funds ... owned ... by, or pertaining to, the
Government or any of its subdivisions, agencies, or instrumentalities (Article IX [D],
Section 2 [1],1987 Constitution). That authority extends to the accounts of all
persons respecting funds or properties received or held by them in an accountable
capacity (Section 26, P. D. No. 1445). In the exercise of its jurisdiction, it determines
whether or not the fiscal responsibility that rests directly with the head of the
government agency has been properly and effectively discharged (Section 25[1],
Ibid.), and whether or not there has been loss or wastage of government resources. It
is also empowered to review and evaluate contracts (Section 18 [4], Ibid.). And, after
an audit has been made, its auditors issue a certificate of settlement to each officer
whose account has been audited and settled in whole or in part, stating the balances
found due thereon and certified, and the charges or differences arising from the
settlement by reason of disallowances, charges or suspensions (Section 82, Ibid.).
Viewed in this light, the disallowance made by COA is neither illegal nor a
usurpation of a management function. The authority of the petitioner, as agency
head, to enter into a contract is not being curtailed. What COA maintains is that the
"pakyao" contract has proved disadvantageous to the government.
Addressing this issue now, the payments for the "pakyao" labor contract were
disallowed on the ground that the cost of that contract was excessive and, therefore,
disadvantageous to the government in that the rate applied by petitioner was
P40.00/day when the prevailing rate at that time was only P25.00/day for casuals.

We find ourselves in disagreement.


The labor contract entered into by petitioner was on the "pakyao" basis. On the
other hand, the transaction was audited on a daily minimum wage rate basis. The
result was that the emergency nature of the contract was overlooked, a different cost
of labor for casuals was imposed, the assistance of two other carpenters who worked
with Layson even on Saturdays was disregarded, and Layson's additional skill as an
electrician and plumber was not adequately considered.
Indeed, the criteria for a daily wage rate contract can hardly be applied to
"pakyao" arrangements, the two being worlds apart. In "pakyao" a worker is paid by
results. It is akin to a contract for a piece of work where-by the contractor binds
himself to execute a piece of work for the employer, in consideration of a certain
price or consideration. The contractor may either employ his labor or skill, or also
furnish the material (Article 1713, Civil Code). Not so in a contract on a daily wage
basis, where what is paid for is the labor alone. Under the "pakyao" system, payment
is made in a lump sum; the laborer makes a profit for himself, which is justified by
the fact that any loss would also be borne by him. On the other hand, no profit inures
to the daily wage worker and no materials are furnished by him. The "pakyao"
arrangement is not without its advantages. The tendency to dilly-dally on the work,
generally experienced in a daily wage contract, is hardly present in labor on a
"pakyao" basis. The latter can also be more flexible, with the need for supervision
reduced to the minimum. It is not necessarily frowned upon. In fact; it is recognized
in the Labor Code (Article 101), and even in the Revised Manual of Instructions to
Treasurers, which provides that "except in construction or repairs requiring technical
skill such as upon buildings, bridges, water works structures, culverts, etc., when the
total cost of the work does not exceed P3,000.00, the same may be performed under
the "pakyao" contract ..." (Section 750). In this case, each contract with Layson did
not exceed P3,000.00.
Recourse to a "pakyao" labor contract, therefore, is not necessarily
disadvantageous. In this case, it was entered into only after public bidding pursuant
to existing regulations through canvass among three qualified "bidders." Since
Layson submitted the lowest price, each contract was awarded to him. The Court
also notes that Layson was subsequently hired as a casual in the Bureau of Treasury
Office in order to do away with the hiring of a carpenter and electrician, thereby
exhibiting an awareness on petitioner's part of government interests and a positive
effort to avail of cost-cutting options.
WHEREFORE, the Decision of the Commission on Audit is hereby SET ASIDE,
and it is hereby ordered to refund to petitioner the disallowed item of P4,276.00,
which amount was deducted from his terminal leave voucher upon his retirement.

69

SO ORDERED.
Yap, C.J., Paras, Padilla and Sarmiento, JJ., concur.
The Lawphil Project - Arellano Law Foundation
EN BANC
[G.R. No. 101370. September 2, 1993.]
NATIONAL HOUSING CORPORATION, Petitioner, v. COMMISSION ON AUDIT
and ARTURO D. DADUFALZA, in his capacity as COA Director, Technical
Services Office, Respondents.
Government Corporate Counsel for petitioner
The Solicitor General for Respondents.
DECISION
PUNO, J.:
Foreign loans usually obligate the debtor country to hire expatriate consultants. This
part of the package makes these loans more onerous. The petition at bar assails the
disallowance by the respondent COA of a contract extending the services of a foreign
consultant on the ground that his work could well be performed by Filipinos. It
cannot succeed.chanrobles.com:cralaw:red
There are no uncertainties on the facts of the case. Our government forged an
agreement on financial cooperation with the Republic of Germany. On April 10,
1981, a Loan and Project Agreement was executed between the Republic of the
Philippines as "Borrower" and the National Housing Authority (NHA) as "Project
Sponsor" on the one hand, and the Kreditanstalt Fur Weideraufbau (KFW) on the
other hand, for Urban Housing Dagat-Dagatan Project II A/B. 1 The agreement
empowered the NHA and the KFW to determine the details of the project as well as
the goods and services to be financed from the loan. They hired the services of
Engineer Brian W. Murdoch of Kinhill Pty. Ltd. (Kinhill), a foreign corporation
organized under the laws of Australia.
In 1987, the KFW proposed to extend the contract of Engr. Murdoch for another
year. The NHA Board of Directors approved only a 3-month extension, from March
9 to June 9, 1987. 2 It also directed its management to make representations with

KFW to replace Engr. Murdoch with a local consultant after June 9, 1987 if the
project would still be unfinished. The 3-month consultancy contract was submitted to
the National Economic Development Authority (NEDA) for approval. 3 On April 1,
1987, NEDA approved the contract with the following
observations:jgc:chanrobles.com.ph
"This Office has no objection to the approval of the contract. His (NHA-General
Manager) attention is called however on the previous observations made by this
Office in the review of previous extension of services of Engr. Murdoch that Engr.
Murdoch has been the consultant of NHA since August 1978 or about 8 years now
and that considering the relatively simple supervision work required for the finishing
stages of the Dagat-Dagatan Project, NHA should have considered hiring local
consultant. It is expected that this extension of services of Engr. Murdoch is the last
and that NHA shall make representations with KFW to substitute a qualified local
consultant for Engr. Murdoch after expiration of the contract if a consultant for the
project is still necessary."cralaw virtua1aw library
On April 10, 1987, NHA and Kinhill executed the consultancy contract (original)
covering the months of March 9 to June 9, 1987. It involved the amount of US
$30,800.00 (foreign cost) and P123,690.00 (local cost).
The 3-month contract, however, did not satisfy KFW. It wanted a 12-month contract.
In June 1987, it got what it wanted. NHA and Kinhill signed a First Supplemental
Contract. It extended the consultancy contract for nine (9) more months from June 9,
1987 to March 8, 1988. Its total cost was US $85,500.00 (foreign cost) and
P332,850.00 (local cost).
The Urban Housing Dagat-Dagatan Project II was not completed as scheduled. On
December 15, 1987, a request was made for an extension of the Loan Agreement for
another year. KFW agreed provided the consultancy contract with Kinhill would be
extended until the end of December 1988. NHA did not appear to have much choice.
On May 8, 1988, it signed a Second Supplemental Contract extending the contract of
Kinhill for another eight (8) months, from April 4 to December 4, 1988. Its total cost
was US $78,500.00 (foreign) and P315,000.00 (local).chanrobles lawlibrary : rednad
The Loan Agreement was supposed to have expired on December 4, 1988.
Nonetheless, there was another request for its extension for a period of six (6)
months. KFW had no objection but again conditioned its approval on the extension
of the consultancy services of Kinhill also for a period of six (6) months. This
resulted in the signing on February 23, 1987 of the Third Supplemental Contract
which extended Kinhills consultancy services from January 4 to July 3, 1989. Its
cost was US $58,200.00 (foreign) and P250,000.00 (local).

70

NHAs legal difficulties started when the Third Supplemental Contract was reviewed
in post audit by the Technical Services Office (TSO). The contract was disallowed in
view of the following findings:jgc:chanrobles.com.ph

"Likewise, it is informed that the review of the selection and the manner of award
and the evaluation concerning all reimburseable direct expense of the consultant are
left with the Auditor.

"This has reference to the review of the Third Supplemental Contract dated February
23, 1989 involving the amount of US$58,200.00 (foreign cost) plus P250,000.00
(local cost) in the contract amount and covering an extension of six (6) months
issued in favor of Kinhill Pty. Ltd. relative to the Consulting Services for Technical
Assistance to National Housing Authority (NHA) under the Kreditanstalt Fuer
Wiederaufbau (KFW) Loan for Dagat-Dagatan Project.

"Attention is invited to the attached Consultancy Contract Review dated April 11,
1989, which is self-explanatory.

"Please be informed that the Consultants monthly rate was established as


reasonable, however, the review conducted disclosed the following
observations:chanrob1es virtual 1aw library

Officer-in-Charge

a. Based on submitted documents, it was noted that this supplemental contract has no
approval from KFW and the Secretary of Public Works and Highways as required in
Article III, Paragraph 3.02 of the contract and Section 3 of Executive Order No. 164
dated May 5, 1987.

On November 26, 1990, NHA requested for reconsideration. It offered the following
explanations:jgc:chanrobles.com.ph

b. The output requirements are not specified and there is no PERT/CPM 4 Network
Diagram or equivalent program of work, thus there is no clear basis for NHAs
evaluation of the consultants accomplishment for purposes of payment. (Note:
Appendix "AA" only reflects objectives).
c. There is no contract provision for liquidated damages in case of delay in project
completion attributed to direct fault of the consultant.
"In addition we reiterate our opinion that the KFW components of the DagatDagatan Project involves simple design and construction procedures and it being in
its finishing stage, requires simple engineering advisory services that can be
undertaken by NHA or DPWH in-house technical staff or at the most a local
consultant. However, perusal of the documents submitted showed NHA was
compelled to continue the consultancy services of Kinhill, otherwise, NHA cannot
get reimbursement from the KFW loan to pay their contractors. (underscoring
supplied).
"It was also noted that in this supplemental contract the Management did not take
into consideration the results of our review made on the previous contracts contained
in our Memorandum dated September 7, 1988.
"In view of the above observation, it is recommended that the contract be disallowed
in audit.

"sgd. EDITHA A. DE LA CRUZ


Assistant Commissioner

Technical Services Office"

"ISSUE NO. 1. This Supplemental Contract has no approval from KFW and the
Secretary of the Public Works and Highways.
"ANSWER: 1.1. On KFW approval, attached for your reference is a copy of
KFW telex of no objection, dated December 22, 1988 "EXHIBIT A." The reply,
action of KFW is usually communicated thru telex. Perusal of all previous
consultancy contracts would support this. Furthermore, let it be informed that it was
KFWs requirement why this consultancy Contract was engaged despite our earlier
manifestation that we hire local consultants "EXHIBIT B."cralaw virtua1aw library
1.2 On the approval by the Secretary of the Department of Public Works and
Highways . . . the Third Supplemental Agreement was approved by the NHA Board
under Resolution No. 1231 5 of March 13, 1987 (sic) "EXHIBIT C."cralaw
virtua1aw library
It may be pointed out at this juncture, that the main reason why the consultancy had
to be extended was due to the delay in the completion of the KFW-Funded River
Bank Improvement Works, which was directly implemented by the Department of
Public Works and Highways, hence, the presence of the foreign consultant was with
the knowledge and acquiescence of the DPWH.
"ISSUE NO. 2. The output requirements are not specified . . . or equivalent
program of work . . .thus there is no clear basis for . . . payment.
"ANSWER: In the original Consultancy Contract, as well as the First and the Second
Supplemental Contract Agreements, the main basis for determining the consultants

71

responsibility have been defined in the Terms of Reference which specified the
technical assistance to be provided by the Consultant to the National Housing
Authority under the KFW Loan Agreement, to wit:chanrob1es virtual 1aw library

"1. Although not stated in the contract that there is no need for the approval of the
DPWH Secretary, Section 3 of Executive Order No. 164 dated May 5, 1987 requires
the said approval.

Assistance to the National Housing Authority for the Dagat-Dagatan Project in the
form of engineering designs, contract documentation, project programming,
supervision and monitoring procedures, evaluation and concurrence on contractors
billings and institutional arrangements with regards associated agencies. In addition,
responsibility will include all associated functions necessary for the timely and
satisfactory completion of the revetment works along the river banks in which the
Department of Public Works and Highways is the responsible agency.

"2. The consultants responsibility which they mentioned, as specified in the Terms
of Reference was general. The output requirements are not specified and there is no
PERT/CPM Network Diagram or equivalent program of work, hence, we still
believed that there is still no basis for NHAs evaluation of the consultants
accomplishments for purposes of payment.

In this respect, since it is a prerequisite that all billings to be processed for payment
to the contractors have to be certified by the consultant, it is the direct responsibility
of the consultant to monitor, the consultant to monitor, verify and evaluate all the
aspects of the project implementation for contracts funded by KFW Loan. This
process will assure the NHA and KFW that disbursement are effected only to cover
works accomplishment in accordance with plans and specifications.chanrobles
virtual lawlibrary
"ISSUE NO. 3 There is no contract provision for liquidated damages in case of
delay in project completion attributed to the fault of the consultant.
"ANSWER: We reiterate in full our previous explanation for this particular
observation:jgc:chanrobles.com.ph

"3. It was confirmed by NHA that there is really no contract provision for liquidated
damages. It so happened that the contract has expired and there has been no record of
consultants fault or delay, thus, the required provision may be considered moot and
academic. However, it is recommended that for future projects, the provisions should
be specified/stipulated.
"4. The main reason for the disallowance is that there is no more need for a foreign
consultant in the final project stage since the remaining work components of the
Dagat-Dagatan Project which involved simple design and construction procedure and
it being in the finishing stage, required simple advisory services that can be
undertaken by NHA or DPWH in-house technical staff or at the most, a local
consultant. The findings was further reinforced by the statements of the NEDA in the
attached 1st Indorsement dated April 1, 1987 . . . bearing on its no objection to the
approval of the original contract:jgc:chanrobles.com.ph
"x

"It is confirmed that there is no contract provision for liquidated damages. However,
there is a contract provision for termination for default or for convenience of NHA.
Further, considering that the contract has already expired and there has been no
record of consultants faults or delays in the project implementation, the required
provision on liquidated damages has become moot and academic."cralaw virtua1aw
library
"With respect to your opinion that the KFW components of the Dagat-Dagatan
involve simple design and construction procedures, etc., let this be of record that we
are 100% in accord with your observation. However, the hiring of an expartriate
consultant is mandated under the Loan Agreement to which NHA must adhere to,
unless otherwise authorized." (Italics ours).
On February 28, 1991, TSO Director Arthur Dadufalza denied the reconsideration.
He opined:jgc:chanrobles.com.ph

x."cralaw virtua1aw library

"The NHA agreed and is 100% in accord with the observation. However, we do not
find in the documents/records submitted that NHA has made stronger representation
with the KFW for the hiring of a local consultant (or at all) as required by the
NEDA." (Italics ours).
On May 15, 1991, the COA, in its Decision No. 1895, affirmed Director Dadufalzas
findings except as regards the lack of provision for liquidated damages which was
considered moot and academic.
NHA filed the instant petition for certiorari where it raises the following
issues:jgc:chanrobles.com.ph
"a. Whether or not the COA acted beyond its constitutionally granted powers by
disallowing a duly entered contract, valid, regular, with all the formalities of law.
"b. Corollary to the above, is whether or not COA acted beyond its constitutionally
granted powers by disallowing a contract on the basis of its self-proclaimed and

72

considered defects on the contract not otherwise provided for in its sets of
regulations promulgated pursuant to the mandate of the Constitution.
"c. Whether or not COA, by virtue of the powers granted to it under the Constitution,
substitute its own judgment or disposition in lieu of the decision of the management
or governing body of government entities."cralaw virtua1aw library

rules and regulations, it goes without saying that failure to comply with them is a
ground for disapproving the payment of the proposed expenditure."cralaw virtua1aw
library
There can be no dispute on the proposition that the continued extension of the
services of Engr. Murdoch as a foreign consultant constitutes at the very least an
unnecessary expense.

The petition lacks merit.


The power of the Commission on Audit to audit and examine government
expenditures is enshrined in Section 2 (1), Article IX-D of the 1987 Constitution,
viz.:jgc:chanrobles.com.ph
"Section 2. (1) The Commission on Audit shall have the power, authority, and duty to
examine, audit and settle all accounts pertaining to the revenue and receipts of, and
expenditures or uses of funds and property, owned or held in trust by, or pertaining
to, the Government, or any of its subdivision, agencies, or instrumentalities,
including government-owned or controlled corporations with original charters, or on
a post audit basis: (a) constitutional bodies, commissions, and offices that have been
granted the fiscal autonomy under this Constitution; . . ."cralaw virtua1aw library
The Constitution also granted to COA the power to "promulgate accounting and
auditing rules and regulations, including those for the prevention and disallowance of
irregular, unnecessary, excessive, extravagant, or unconscionable expenditures, or
uses of government funds and properties." 6
Pursuant to the said constitutional mandate, COA promulgated Circular No. 88-55-A
dated September 8, 1985 defining the term "unnecessary" expenditures,
viz.:jgc:chanrobles.com.ph
"The term pertains to expenditures which could not pass the test of prudence or the
diligence of a good father of a family, thereby denoting non-responsiveness to the
exigencies of the service. Unnecessary expenditures are those not supportive of the
implementation of the objectives and mission of the agency relative to the nature of
its operation. This would also include incurrence of expenditure not dictated by the
demands of good government, and those the utility of which cannot be ascertained at
a specific time. An expenditure that is not essential or that which can be dispensed
with without loss or damage to property is considered unnecessary. The mission and
thrust of the agency incurring the expenditures must be considered in determining
whether or not an expenditure is necessary." (Italics ours).
In Caltex Philippines, Inc. v. COA, 7 We recognized the authority of COA to
disallow irregular, unnecessary, excessive, extravagant or unconscionable (IUEEU)
expenditures. We ruled: "Since the COA is responsible for the enforcement of the

Crystal clear from the records is that the nature of the terminal phase of the DagatDagatan project does not require the expertise of a foreign consultant. As early as
April 1, 1987, the necessity of extending the services of Engr. Murdoch has been
questioned by NEDA "considering the relatively simple supervision work required
for the final stages of the project." 8 This observation was echoed by COA in its post
audit review of the First and Second Supplemental Contracts, 9
viz:jgc:chanrobles.com.ph
"In addition, it is our opinion that the KFW components of the Dagat-Dagatan
Project involves simple design and construction procedures, and it being in its
finishing stage, requires simple advisory services that can be undertaken by NHA or
DPWH in-house technical staff or at the most a local consultant. Hence, the NHA
should have made stronger representations with the KFW for the hiring of a local
consultant (or none at all) as required by NEDA."cralaw virtua1aw library
Petitioner itself has taken the position that the services of Engr. Murdoch can be
dispensed with and can well be done by Filipinos. In 1987, petitioners Board
already directed its management to make representations with KFW to replace Engr.
Murdoch with a Filipino consultant if the project would still be unfinished. Again, in
its memorandum dated November 26, 1990, petitioner categorically admitted that the
KFW components of the Dagat-dagatan Project involved simple designs and
construction procedures which could easily be handled by a local consultant. Despite
all these admissions, petitioner proceeded to extend the unnecessary services of Engr.
Murdoch as it consummated the disputed Third Supplemental Contract. The amount
of money that was spent for the unnecessary services of Engr. Murdoch speaks for
itself.chanrobles law library
Petitioner argues that the renewal of the loan agreement with the KFW would have
been jeopardized if it did not agree to the extension of the services of Engr. Murdoch.
The short answer to this argument is that the imperative necessity to comply with the
command of our Constitution prohibiting unnecessary expenses of public funds is
beyond compromise. No amount of the almighty dollar can justify anybody,
especially foreigners, to mangle the mandates of our fundamental law. The postulates
of our Constitution are not mere platitudes which we should honor only in rhetorics
but not in reality. In fine, the power to contract a foreign loan does not carry with it
the authority to bargain away the ideals of our Constitution.

73

IN VIEW WHEREOF, the petition for certiorari is dismissed.


SO ORDERED.
[G.R. No. 88435. January 16, 2002]
DEVELOPMENT BANK OF THE PHILIPPINES, JESUS P. ESTANISLAO,
DOLORES A. SANTIAGO, LYNN H. CATUNCAN, NORMA O. TERREL, MA.
ANTONIA G. REBUENO, petitioners, vs. COMMISSION ON AUDIT, respondent.

Narvasa, C.J., Cruz, Feliciano, Padilla, Bidin, Grio-Aquino, Regalado, Davide, Jr.,
Romero, Nocon, Bellosillo, Melo, Quiason and Vitug, JJ., concur.
4. Furthermore, like all financial institutions under Central Bank supervision, DBP
will now be required to have a private external audit, and its Board of Directors will
now be opened to adequate private sector representation. It is hoped that with these
commitments, DBP can avoid the difficulties of the past and can function as a
competitive and viable financial institution within the Philippine financial system.[5]
(Emphasis supplied)

DECISION
CARPIO, J.:
The Case
This is a petition for review on certiorari[1] of the letter-decision of the Chairman of
the Commission on Audit[2] (COA for brevity) and the letter-decision of the COA en
banc[3], prohibiting the Development Bank of the Philippines (DBP for brevity)
from hiring a private external auditor. This petition raises a question of first
impression, whether or not the constitutional power of the COA to examine and audit
the DBP is exclusive and precludes a concurrent audit of the DBP by a private
external auditor.
The Antecedent Facts
In 1986, the Philippine government, under the administration of then President
Corazon C. Aquino, obtained from the World Bank an Economic Recovery Loan
(ERL for brevity) in the amount of US$310 million. The ERL was intended to
support the recovery of the Philippine economy, at that time suffering severely from
the financial crisis that hit the country during the latter part of the Marcos regime.
As a condition for granting the loan, the World Bank required the Philippine
government to rehabilitate the DBP which was then saddled with huge nonperforming loans. Accordingly, the government committed to rehabilitate the DBP to
make it a viable and self-sustaining financial institution in recognition of its
developmental role in the economy. The DBP was expected to continue providing
principally medium and long-term financing to projects with risks higher than the
private sector may be willing to accept under reasonable terms.[4] The governments
commitment was embodied in the Policy Statement for the Development Bank of the
Philippines which stated in part:

On November 28, 1986, the Monetary Board adopted Resolution No. 1079 amending
the Central Banks Manual of Regulations for Banks and other Financial
Intermediaries, in line with the governments commitment to the World Bank to
require a private external auditor for DBP. Thus, on December 5, 1986, the Central
Bank Governor issued Central Bank Circular No. 1124, providing that:
SECTION 1. Subsection 1165.5 (Book I) is amended to read as follows:
1165.5 Financial Audit. - Each Bank, whether Government-owned or controlled or
private, shall cause an annual financial audit to be conducted by an external
independent auditor not later than thirty (30) days after the close of the calendar year
or the fiscal year adopted by the bank. x x x.
x x x The Audit of a Government-owned or controlled bank by an external
independent auditor shall be in addition to and without prejudice to that conducted
by the Commission on Audit in the discharge of its mandate under existing law. x x
x.
xxx
SECTION 3. The requirement for an annual financial audit by an external
independent auditor shall extend to specialized and unique government banks such as
the Land Bank of the Philippines and the Development Bank of the Philippines.[6]
On December 12, 1986, pursuant to Central Bank Circular No. 1124 and the
governments commitment to the World Bank, DBP Chairman Jesus Estanislao wrote
the COA seeking approval of the DBPs engagement of a private external auditor in
addition to the COA.[7]
On January 2, 1987, to formalize its request for the ERL, the Philippine government
sent the World Bank a letter assuring the World Bank that pursuant to Central Bank
Circular No. 1124, all Banks, including government banks, shall be fully audited by

74

external independent auditors x x x in addition to that provided by the Commission


on Audit. The letter was signed by the Central Bank Governor and the Ministers of
Finance, Trade and Industry, and Economic Planning of the Philippine government.
[8]
On January 8, 1987, the Philippine government and World Bank negotiating panels
reached final agreement on the private audit of the DBP, as follows:
13. With respect to the draft Policy Statement, it was agreed that Sections 4, 7 and 11
would be amended as follows:
x x x (iii) Section 11 should in line with the letter of Development Policy, confirm
that the external independent audits would commence with a balance sheet audit as
of December 31, 1986 and a full financial audit, including income statements,
starting with the period July 1 to December 31, 1986. A copy of COAs letter
(referred to in par. 1, a draft of which is attached as Annex VIII) regarding DBPs
appointment of a private external auditor will be sent to the Bank before the
distribution of the loan documents to the Banks Board, along with a copy of the
scope of audit as approved by COA and satisfactory to the Bank.
With regard to the scope of the audit to be undertaken by the private external
auditors, the terms of reference which will be issued to the selected auditors should
be generally consistent with the attached model terms of reference for financial
audits (Annex IX). These general terms of reference were discussed during
negotiations and form a part of the World Banks guidelines for financial information
on financial institutions.[9]
On January 20, 1987, then COA Chairman Teofisto Guingona, Jr. replied to the
December 12, 1986 letter of the DBP Chairman. The COA Chairmans reply stated
that:
x x x the Commission on Audit (COA) will interpose no objection to your
engagement of a private external auditor as required by the Economic Recovery
Program Loan Agreements of 1987 provided that the terms for said audit are first
reviewed and approved by the Commission.[10]
The following day, the COA Chairman also informed the Consultant of the Central
Bank that the COA interposed no objection to the proposed scope of audit services to
be undertaken by the private external auditors to be engaged by the DBP. [11]
On February 18, 1987, the Board of Directors of the DBP approved the hiring of
Joaquin Cunanan & Co. as the DBPs private external auditor for calendar year 1986
as required by Central Bank Circular No. 1124 and the World Bank. The DBP Board

of Directors placed a ceiling on the amount of reimbursable out-of-pocket expenses


that could be charged by the private auditor.[12]
On February 23, 1987, the World Bank President, in his Report to the Banks
Executive Directors on the Philippine governments application for the ERL, certified
that the Philippine government was complying with the requirement of a private
external auditor. The World Bank Presidents certification stated that:
74. Accounting and Auditing. All banks both government and private are now subject
to accounting and auditing standards as established by the Central Bank. To ensure
full public accountability, the Monetary Board now requires that all government
banks be subject to annual audits by independent private auditing firms, in addition
to those normally undertaken by the Governments Commission on Audit. DBP and
PNB have already selected private auditors, and audited accounts for 1986 and 1987
will be a requirement for the releases of the second and third tranches, respectively,
of the ERL.[13]
However, a change in the leadership of the COA suddenly reversed the course of
events. On April 27, 1987, the new COA Chairman, Eufemio Domingo, wrote the
Central Bank Governor protesting the Central Banks issuance of Circular No. 1124
which allegedly encroached upon the COAs constitutional and statutory power to
audit government agencies. The COA Chairmans letter informed the Governor that:
This Commission hereby registers its strong objection to that portion of the CBP
Circular No. 1124 which requires government banks to engage private auditors in
addition to that conducted by the Commission on Audit, and urges the immediate
amendment thereof. It is the position of this Commission that the said requirement:
(a) infringes on Article IX-D of the Philippine Constitution; (b) violates Section 26
and 32 of the Government Auditing Code of the Philippines; (c) exposes the financial
programs and strategies of the Philippine Government to high security risks; (d)
allows the unnecessary and unconscionable expenditure of government funds; and
(e) encourages unethical encroachment among professionals.[14]
On May 13, 1987, after learning that the DBP had signed a contract with a private
auditing firm for calendar year 1986, the new COA Chairman wrote the DBP
Chairman that the COA resident auditors were under instructions to disallow any
payment to the private auditor whose services were unconstitutional, illegal and
unnecessary.[15]
On July 1, 1987, the DBP Chairman sent to the COA Chairman a copy of the DBPs
contract with Joaquin Cunanan & Co., signed four months earlier on March 5, 1987.
The DBP Chairmans covering handwritten note sought the COAs concurrence to the
contract.[16]

75

During the pendency of the DBP Chairmans note-request for concurrence, the DBP
paid the billings of the private auditor in the total amount of P487,321.14[17] despite
the objection of the COA. On October 30, 1987, the COA Chairman issued a
Memorandum disallowing the payments, and holding the following persons
personally liable for such payment:
SVP Fajardo who approved the voucher for payment; VP Santiago who certified that
the expenditure was authorized, necessary and lawful; SM Terrel, Catuncan and
Rebueno who signed the checks; and the head of office who signed the contract and
who is immediately and primarily responsible for the funds of the Bank.[18]
On January 19, 1988, the DBP Chairman wrote the COA Chairman seeking
reconsideration of the COA Chairmans Memorandum.[19] However, the DBP
received no response until August 29, 1988 when the COA Chairman issued a letterdecision denying petitioners July 1, 1987 note-request for concurrence. The letterdecision, one of the two COA decisions assailed in this petition, declared in part as
follows:
(a) In the letter to the Central Bank Governor x x x, this Commission clearly stated
its non-negotiable stand on the issue in the following terms:
x x x the very essence of the Commission on Audit as an independent constitutional
commission in the total scheme of Government, is its singular function to [E]xamine,
audit, and settle x x x all accounts pertaining to x x x the Government, or any of its
subdivisions, x x x including government-owned or controlled corporations. To allow
private firms to interfere in this governmental audit domain would be to derogate the
Constitutional supremacy of State audit as the Governments guardian of the peoples
treasury, and as the prime advocate of economy in the use of government resources.
xxx
(c) In the letter to the Secretary of Finance dated January 28, 1988 x x x, this
Commission maintains:
1. COA is in no way prepared to permit use of private auditors except insofar as the
law allows, which is to deputize and retain in the name of the Commission such
certified public accountants and other licensed professionals not in the public service
as it may deem necessary to assist government auditors in undertaking specialized
audit engagements (Sec. 31, PD No 1445). Outside of this, the Commission does not
consider the matter of hiring private auditing firms a negotiable matter, and this we
want to emphasize to avoid future embarrassment to the Government. The
Commission on Audit is a constitutionally-created independent and separate body,
and neither Congress nor the Executive Department has the power to detract from its
mandated duties, functions, and powers.

2. Since the proceeds of the proposed loan accrue to the Republic of the Philippines
as borrower, it follows that its accounting and audit must comply with the laws of
this country. To specify in the Loan Agreement that the loan account, once released
to the Government, shall be audited by independent auditors acceptable to the Bank
is not only to entirely by-pass this Commission but to ignore as well the Constitution
and the laws of this country which vests in this Commission the power, authority,
and duty to examine, audit, and settle all accounts pertaining to the revenue and
receipts of, and expenditures or uses of funds and property x x x pertaining to the
Government. (Sec. 2, Art. IX-D, Phil. Const.).
Such brazen disregard of the fundamental law of this country cannot be
countenanced by this Commission.
In view of all the foregoing, you are hereby advised:
1. To desist from proceeding with the audit of Joaquin Cunanan & Co. of the Banks
financial statements for the year ending December 31, 1987.
2. To refrain from making any payments out of the funds of the Development Bank
of the Philippines, in the event that such audit services have already been rendered,
attention being invited to the following provisions of the Government Auditing Code
of the Philippines:
Sec. 108. General liability for unlawful expenditures Expenditures of government
funds or uses of government property in violation of law or regulations shall be a
personal liability of the official or employee found to be directly responsible
therefore.
3. To restitute, within thirty (30) days from receipt hereof, the total amount of
P513,549.24 under CV Nos. 9136, 5014, 6201 and 4082 for professional services
rendered in the audit of the 1986 financial operations of the Bank. Pursuant to the
aforequoted provisions of law, such unlawful expenditure is the personal liability of
the official directly responsible therefore.
Please be guided accordingly.[20]
On September 26, 1988, the DBP Chairman appealed the letter-decision to the COA
en banc. On May 20, 1989, the COA en banc, in a letter-decision, denied the DBPs
appeal. This letter-decision, now also assailed by the DBP, held that:
Upon a circumspect evaluation of the grounds upon which your instant request is
predicated, this Commission finds the same to be devoid of merit. As hereunder

76

demonstrated, the justifications offered do not inspire rational belief in the mind of
this Commission.
First, it bears stress that CB Circular No. 1124, series of 1986, which has earlier been
shown to be constitutionally and legally infirm, cannot by any means possess any
binding and conclusive effect upon this Commission and, hence, may not be properly
invoked in support of the instant appeal.
Secondly, it was not the International Bank for Reconstruction and Development
which required the audit of government banks by private auditing firm, but the
Central Bank itself.

Hence, on June 14, 1989 the DBP filed this petition for review with prayer for a
temporary restraining order, assailing the two COA letter-decisions for being
contrary to the Constitution and existing laws. On June 15, 1989 this Court issued a
temporary restraining order directing the COA to cease and desist from enforcing its
challenged letter-decisions. The Office of the Solicitor General, in a Manifestation
dated October 18, 1989, declined to appear on behalf of the COA on the ground that
the Solicitor General was taking a position adverse to that of the COA.
Consequently, a private counsel on pro bono basis represented the COA.
The Issues

Thirdly, insofar as this Commission is concerned, PD 2029 is an anachronism of


sorts if viewed in the light of the present Constitution recognizing this Commission
as the supreme and exclusive audit institution of the government. This is necessarily
implicit from the bare language of Section 2(1), Article IX-D thereof which, despite
the absence of the qualifying adjective exclusive that anyway would be a surplusage,
ought to be reasonably construed as vesting in this Commission the power, authority,
and duty to audit all government accounts to the exclusion of any other person or
entity, whether in the public or the private sector. Expressio unius est exclusio
alterius. A contrary interpretation, such as that being pressed upon this Commission,
would reduce this constitutional ordinance to an absurdity (reductio ad absurdum) as
it thereby would give rise to the rather confusing spectacle, as it were, of a
government agency or corporation being audited not only by this Commission but
also and in addition thereto by one or two or several private accounting firms
certainly a situation never intended by the framers of the Constitution.

The DBPs petition raises the following issues:

Lastly, while this Commission has not lost sight of the letter of then COA Chairman
Guingona, Jr. to the DBP Chairman, dated January 20, 1987, it has opted to be
guided and influenced by the more persuasive and controlling COA Circular No.
860254 dated March 24, 1986, which in categorical and precise terms ordained that:

The Courts Ruling

1. Does the Constitution vest in the COA the sole and exclusive power to examine
and audit government banks so as to prohibit concurrent audit by private external
auditors under any circumstance?
2. Is there an existing statute that prohibits government banks from hiring private
auditors in addition to the COA? If there is none, is there an existing statute that
authorizes government banks to hire private auditors in addition to the COA?
3. If there is no legal impediment to the hiring by government banks of a private
auditor, was the hiring by the DBP of a private auditor in the case at bar necessary,
and were the fees paid by DBP to the private auditor reasonable, under the
circumstances?

The DBPs petition is meritorious.


First Issue: Power of COA to Audit under the Constitution

Accordingly, by way of reassertion and reaffirmation of its primary audit


jurisdiction, as herein above defined, the Commission on Audit hereby issues the
following directives:
1. Any ongoing audit of a government-owned and/or controlled corporation or any of
its subsidiaries or corporate offsprings being conducted by a private auditor or
accounting firm shall cease and terminate on April 15, 1986. Henceforth, from and
after said date, the audit of said corporate entity shall be undertaken solely and
exclusively by the Commission on Audit. x x x.
Premises considered, it is regretted that your instant request for reconsideration has
to be, as it is hereby, denied.[21]

The resolution of the primordial issue of whether or not the COA has the sole and
exclusive power to examine and audit government banks involves an interpretation
of Section 2, Article IX-D of the 1987 Constitution. This Section provides as
follows:
Sec. 2. (1) The Commission on Audit shall have the power, authority, and duty to
examine, audit, and settle all accounts pertaining to the revenue and receipts of, and
expenditures or uses of funds and property, owned and held in trust by, or pertaining
to, the Government, or any of its subdivisions, agencies, or instrumentalities,
including government-owned or controlled corporations with original charters, x x x.

77

(2) The Commission shall have the exclusive authority, subject to the limitations in
this Article, to define the scope of its audit and examination, establish the techniques
and methods required therefore, and promulgate accounting and auditing rules and
regulations, including those for the prevention and disallowance of irregular,
unnecessary, excessive, extravagant, or unconscionable expenditures, or uses of
government funds and properties. (Emphasis supplied)
The COA vigorously asserts that under the first paragraph of Section 2, the COA
enjoys the sole and exclusive power to examine and audit all government agencies,
including the DBP. The COA contends this is similar to its sole and exclusive
authority, under the second paragraph of the same Section, to define the scope of its
audit, promulgate auditing rules and regulations, including rules on the disallowance
of unnecessary expenditures of government agencies. The bare language of Section
2, however, shows that the COAs power under the first paragraph is not declared
exclusive, while its authority under the second paragraph is expressly declared
exclusive. There is a significant reason for this marked difference in language.
During the deliberations of the Constitutional Commission, Commissioner Serafin
Guingona proposed the addition of the word exclusive in the first paragraph of
Section 2, thereby granting the COA the sole and exclusive power to examine and
audit all government agencies. However, the Constitutional Commission rejected the
addition of the word exclusive in the first paragraph of Section 2 and Guingona was
forced to withdraw his proposal. Commissioner Christian Monsod explained the
rejection in this manner:
MR. MONSOD. Earlier Commissioner Guingona, in withdrawing his amendment to
add EXCLUSIVE made a statement about the preponderant right of COA.
For the record, we would like to clarify the reason for not including the word. First,
we do not want an Article that would constitute a disincentive or an obstacle to
private investment. There are government institutions with private investments in
them, and some of these investors - Filipinos, as well as in some cases, foreigners require the presence of private auditing firms, not exclusively, but concurrently. So
this does not take away the power of the Commission on Audit. Second, there are
certain instances where private auditing may be required, like the listing in the stock
exchange. In other words, we do not want this provision to be an unnecessary
obstacle to privatization of these companies or attraction of investments.[22]
(Emphasis supplied)
Shortly thereafter, Commissioner Guingona attempted to resurrect his amendment by
proposing the following provision:
Private auditing firms may not examine or audit accounts pertaining to the revenue
and receipts of, and expenditures or uses of funds and property owned or held in trust

by or pertaining to the Government or any of its subdivisions, agencies or


instrumentalities.[23]
Guingona argued that a private audit in addition to the COA audit would be a useless
duplication and an unnecessary expense on the part of government.
The Constitutional Commission also rejected this proposed provision, after
Commissioner Monsod made the following explanation:
MR. MONSOD. x x x But it is also a fact that even government agencies,
instrumentalities and subdivisions sometimes borrow money from abroad. And if we
are at all going to preclude the possibility of any concurrent auditing, if that is
required, and insist that it is only exclusively the government which can audit, we
may be unnecessarily tying their hands without really accomplishing much more
than what we want. As long as the COA is there, and the COAs power cannot be
eliminated by law, by decree or anything of that sort, then the government funds are
protected.
As far as the question of fees is concerned, this is always negotiable. Besides, if one
talks about auditing fees, these are governed by certain regulations within the
auditing profession, beyond which auditing firms cannot go. Furthermore, the
government can always refuse to pay unconscionable fees. So, that matter really is
not that relevant. But I think what we want to insist on is that there should be some
flexibility so that a procedural requirement does not impede a substantive transaction
as long as COA is there.[24] (Emphasis supplied)
The rejection of Guingonas second proposal put an end to all efforts to grant the
COA the sole and exclusive power to examine and audit government agencies.
In sharp contrast, the Constitutional Commission placed the word exclusive to
qualify the authority of the COA under the second paragraph of the same Section 2.
The word exclusive did not appear in the counterpart provisions of Section 2 in the
1935 and 1973 Constitutions.[25] There is no dispute that the COAs authority under
the second paragraph of Section 2 is exclusive as the language of the Constitution
admits of no other meaning. Thus, the COA has the exclusive authority to decide on
disallowances of unnecessary government expenditures. Other government agencies
and their officials, as well as private auditors engaged by them, cannot in any way
intrude into this exclusive function of the COA.
The qualifying word exclusive in the second paragraph of Section 2 cannot be
applied to the first paragraph which is another sub-section of Section 2. A qualifying
word is intended to refer only to the phrase to which it is immediately associated,
and not to a phrase distantly located in another paragraph or sub-section.[26] Thus,
the first paragraph of Section 2 must be read the way it appears, without the word

78

exclusive, signifying that non-COA auditors can also examine and audit government
agencies. Besides, the framers of the Constitution intentionally omitted the word
exclusive in the first paragraph of Section 2 precisely to allow concurrent audit by
private external auditors.
The clear and unmistakable conclusion from a reading of the entire Section 2 is that
the COAs power to examine and audit is non-exclusive. On the other hand, the
COAs authority to define the scope of its audit, promulgate auditing rules and
regulations, and disallow unnecessary expenditures is exclusive.
Moreover, as the constitutionally mandated auditor of all government agencies, the
COAs findings and conclusions necessarily prevail over those of private auditors, at
least insofar as government agencies and officials are concerned. The superiority or
preponderance of the COA audit over private audit can be gleaned from the records
of the Constitutional Commission, as follows:
MR. GUINGONA. Madam President, after consultation with the honorable members
of the Committee, I have amended my proposed amendment by deleting the word
EXCLUSIVE because I was made to understand that the Commission on Audit will
still have the preponderant power and authority to examine, audit and settle.[27]
(Emphasis supplied)
The findings and conclusions of the private auditor may guide private investors or
creditors who require such private audit. Government agencies and officials,
however, remain bound by the findings and conclusions of the COA, whether the
matter falls under the first or second paragraph of Section 2, unless of course such
findings and conclusions are modified or reversed by the courts.
The power of the COA to examine and audit government agencies, while nonexclusive, cannot be taken away from the COA. Section 3, Article IX-D of the
Constitution mandates that:
Sec. 3. No law shall be passed exempting any entity of the Government or its
subsidiary in any guise whatsoever, or any investment of public funds, from the
jurisdiction of the Commission on Audit.
The mere fact that private auditors may audit government agencies does not divest
the COA of its power to examine and audit the same government agencies. The COA
is neither by-passed nor ignored since even with a private audit the COA will still
conduct its usual examination and audit, and its findings and conclusions will still
bind government agencies and their officials. A concurrent private audit poses no
danger whatsoever of public funds or assets escaping the usual scrutiny of a COA
audit.

Manifestly, the express language of the Constitution, and the clear intent of its
framers, point to only one indubitable conclusion - the COA does not have the
exclusive power to examine and audit government agencies. The framers of the
Constitution were fully aware of the need to allow independent private audit of
certain government agencies in addition to the COA audit, as when there is a private
investment in a government-controlled corporation, or when a government
corporation is privatized or publicly listed, or as in the case at bar when the
government borrows money from abroad.
In these instances the government enters the marketplace and competes with the rest
of the world in attracting investments or loans. To succeed, the government must
abide with the reasonable business practices of the marketplace. Otherwise no
investor or creditor will do business with the government, frustrating government
efforts to attract investments or secure loans that may be critical to stimulate
moribund industries or resuscitate a badly shattered national economy as in the case
at bar. By design the Constitution is flexible enough to meet these exigencies. Any
attempt to nullify this flexibility in the instances mentioned, or in similar instances,
will be ultra vires, in the absence of a statute limiting or removing such flexibility.
The deliberations of the Constitutional Commission reveal eloquently the intent of
Section 2, Article IX-D of the Constitution. As this Court has ruled repeatedly, the
intent of the law is the controlling factor in the interpretation of the law.[28] If a law
needs interpretation, the most dominant influence is the intent of the law.[29] The
intent of the law is that which is expressed in the words of the law, which should be
discovered within its four corners aided, if necessary, by its legislative history.[30] In
the case of Section 2, Article IX-D of the Constitution, the intent of the framers of
the Constitution is evident from the bare language of Section 2 itself. The
deliberations of the Constitutional Commission confirm expressly and even elucidate
further this intent beyond any doubt whatsoever.
There is another constitutional barrier to the COAs insistence of exclusive power to
examine and audit all government agencies. The COAs claim clashes directly with
the Central Banks constitutional power of supervision over banks under Section 20,
Article XII of the Constitution. This provision states as follows:
Sec. 20. The Congress shall establish an independent central monetary authority, the
members of whose governing board must be natural-born Filipino citizens, of known
probity, integrity, and patriotism, the majority of whom shall come from the private
sector. They shall also be subject to such other qualifications and disabilities as may
be prescribed by law. The authority shall provide policy direction in the areas of
money, banking, and credit. It shall have supervision over the operations of banks
and exercise such regulatory powers as may be provided by law over the operations
of finance companies and other institutions performing similar functions. (Emphasis
supplied)

79

Historically, the Central Bank has been conducting periodic and special examination
and audit of banks to determine the soundness of their operations and the safety of
the deposits of the public. Undeniably, the Central Banks power of supervision
includes the power to examine and audit banks, as the banking laws have always
recognized this power of the Central Bank.[31] Hence, the COAs power to examine
and audit government banks must be reconciled with the Central Banks power to
supervise the same banks. The inevitable conclusion is that the COA and the Central
Bank have concurrent jurisdiction, under the Constitution, to examine and audit
government banks.
However, despite the Central Banks concurrent jurisdiction over government banks,
the COAs audit still prevails over that of the Central Bank since the COA is the
constitutionally mandated auditor of government banks. And in matters falling under
the second paragraph of Section 2, Article IX-D of the Constitution, the COAs
jurisdiction is exclusive. Thus, the Central Bank is devoid of authority to allow or
disallow expenditures of government banks since this function belongs exclusively
to the COA.
Second Issue: Statutes Prohibiting or Authorizing Private Auditors
The COA argues that Sections 26, 31 and 32 of PD No. 1445, otherwise known as
the Government Auditing Code of the Philippines, prohibit the hiring of private
auditors by government agencies. Section 26 of PD No. 1445 provides that:
Section 26. General Jurisdiction. The authority and powers of the Commission shall
extend to and comprehend all matters relating to auditing procedures, systems and
controls, the keeping of the general accounts of the Government, the preservation of
vouchers pertaining thereto for a period of ten years, the examination and inspection
of the books, records, and papers relating to those accounts; and the audit and
settlement of the accounts of all persons respecting funds or property received or
held by them in an accountable capacity, as well as the examination, audit, and
settlement of all debts and claims of any sort due or owing to the Government or any
of its subdivisions, agencies or instrumentalities. The said jurisdiction extends to all
government-owned or controlled corporations, including their subsidiaries, and other
self-governing boards, commissions, or agencies of the Government, and as herein
prescribed, including non-governmental entities subsidized by the government, those
funded by donations through the government, those required to pay levies or
government share, and those for which the government has put up a counterpart fund
or those partly funded by the government.
Section 26 defines the extent and scope of the powers of the COA. Considering the
comprehensive definition in Section 26, the COAs jurisdiction covers all government
agencies, offices, bureaus and units, including government-owned or controlled

corporations, and even non-government entities enjoying subsidy from the


government. However, there is nothing in Section 26 that states, expressly or
impliedly, that the COAs power to examine and audit government banks is exclusive,
thereby preventing private audit of government agencies concurrently with the COA
audit.
Section 26 is a definition of the COAs general jurisdiction. Jurisdiction may be
exclusive or concurrent. Section 26 of PD No. 1445 does not state that the COAs
jurisdiction is exclusive, and there are other laws providing for concurrent
jurisdiction. Thus, Section 26 must be applied in harmony with Section 58[32] of the
General Banking Law of 2000 (RA No. 8791) which authorizes unequivocally the
Monetary Board to require banks to hire independent auditors. Section 58 of the
General Banking Law of 2000 states as follows:
Section 58. Independent Auditor. - The Monetary Board may require a bank, quasibank or trust entity to engage the services of an independent auditor to be chosen by
the bank, quasi-bank or trust entity concerned from a list of certified public
accountants acceptable to the Monetary Board. The term of the engagement shall be
as prescribed by the Monetary Board which may either be on a continuing basis
where the auditor shall act as resident examiner, or on the basis of special
engagements; but in any case, the independent auditor shall be responsible to the
banks, quasi-banks or trust entitys board of directors. A copy of the report shall be
furnished to the Monetary Board. x x x. (Emphasis supplied)
Moreover, Section 26 must also be applied in conformity with Sections 25 and
28[33] of the New Central Bank Act (RA No. 7653) which authorize expressly the
Monetary Board to conduct periodic or special examination of all banks. Sections 25
and 28 of the New Central Bank Act state as follows:
Sec. 25. Supervision and Examination. The Bangko Sentral shall have supervision
over, and conduct periodic or special examinations of, banking institutions x x x.
(Emphasis supplied)
xxx
Sec. 28. Examination and Fees. The supervising and examining department head,
personally or by deputy, shall examine the books of every banking institution once in
every twelve (12) months, and at such other time as the Monetary Board by an
affirmative vote of five (5) members may deem expedient and to make a report on
the same to the Monetary Board: x x x. (Emphasis supplied)
The power vested in the Monetary Board under Section 58 of the General Banking
Law of 2000, and Sections 25 and 28 of the New Central Bank Act, emanates from
the Central Banks explicit constitutional mandate to exercise supervision over the

80

operations of banks. Under Section 4 of the General Banking Law of 2000, the term
supervision[34] is defined as follows:
Section 4. Supervisory Powers. The operations and activities of banks shall be
subject to supervision of the Bangko Sentral. Supervision shall include the
following:

Section 31 is bereft of any language that prohibits, expressly or impliedly, the hiring
of private auditors by government agencies. This provision of law merely grants
authority to the COA to hire and deputize private auditors to assist the COA in the
auditing of government agencies. Such private auditors operate under the authority
of the COA. By no stretch of statutory construction can this provision be interpreted
as an absolute statutory ban on the hiring of private auditors by government
agencies. Evidently, the language of the law does not support the COAs claim.

xxx
4.2. The conduct of examination to determine compliance with laws and regulations
if the circumstances so warrant as determined by the Monetary Board;
xxx

Moreover, the COA further contends that Section 32 of PD No. 1445 is another
provision of law that prohibits the hiring of private auditors by government agencies.
Section 32 provides as follows:

x x x. (Emphasis supplied)

Section 32. Government contracts for auditing, accounting, and related services. (1)
No government agency shall enter into any contract with any private person or firm
for services to undertake studies and services relating to government auditing,
including services to conduct, for a fee, seminars or workshops for government
personnel on these topics, unless the proposed contract is first submitted to the
Commission to enable it to determine if it has the resources to undertake such studies
or services. The Commission may engage the services of experts from the public or
private sector in the conduct of these studies.

Clearly, under existing laws, the COA does not have the sole and exclusive power to
examine and audit government banks. The Central Bank has concurrent jurisdiction
to examine and audit, or cause the examination and audit, of government banks.

(2) Should the Commission decide not to undertake the study or service, it shall
nonetheless have the power to review the contract in order to determine the
reasonableness of its costs. (Emphasis supplied)

Section 31 of PD No. 1445, another provision of law claimed by the COA to prohibit
the hiring of private auditors by government agencies, provides as follows:

Section 32 refers to contracts for studies and services relating to government auditing
which the COA may or may not want to undertake itself for a government agency.
Stated another way, Section 32 speaks of studies and services that the COA may
choose not to render to a government agency. Obviously, the subject of these
contracts is not the audit itself of a government agency because the COA is
compelled to undertake such audit and cannot choose not to conduct such audit. The
Constitution and existing law mandate the COA to audit all government agencies.
Section 2, Article IX-D of the Constitution commands that the COA shall have the x
x x duty to examine, audit, and settle all accounts of government agencies (Emphasis
supplied). Similarly, the Revised Administrative Code of 1987 directs that the
Commission on Audit shall have the x x x duty to examine, audit, and settle all
accounts[35] of government agencies (Emphasis supplied). Hence, the COA cannot
refuse to audit government agencies under any circumstance.

4.4. Regular investigation which shall not be oftener than once a year from the last
date of examination to determine whether an institution is conducting its business on
a safe or sound basis: Provided, That the deficiencies/irregularities found by or
discovered by an audit shall immediately be addressed;

Section 31. Deputization of private licensed professionals to assist government


auditors. - (1) The Commission may, when the exigencies of the service so require,
deputize and retain in the name of the Commission such certified public accountants
and other licensed professionals not in the public service as it may deem necessary to
assist government auditors in undertaking specialized audit engagements.
(2) The deputized professionals shall be entitled to such compensation and
allowances as may be stipulated, subject to pertinent rules and regulations on
compensation and fees.
According to the COA, Section 31 is the maximum extent that private auditors can
participate in auditing government agencies and anything beyond this is without
legal basis. Hence, the COA maintains that the hiring of private auditors who act in
their own name and operate independently of the COA is unlawful.

The subject of the contracts referred to in Section 32 is necessarily limited to studies,


seminars, workshops, researches and other services on government auditing which
the COA may or may not undertake at its discretion, thereby excluding the audit
itself of government agencies. Since the COA personnel have the experience on
government auditing and are in fact the experts on this subject, it is only proper for

81

the COA to be granted the right of first refusal to undertake such services if required
by government agencies. This is what Section 32 is all about and nothing more.
Plainly, there is nothing in Section 32 which prohibits the hiring of private auditors
to audit government agencies concurrently with the COA audit.
On the other hand, the DBP cites Central Bank Circular No. 1124[36] as legal basis
for hiring a private auditor. This Circular amended Subsection 1165.5 (Book I) of the
Manual of Regulations for Banks and other Financial Intermediaries to require
[E]ach bank, whether government-owned or controlled or private, x x x (to) cause an
annual financial audit to be conducted by an external auditor x x x. Moreover, the
Circular states that the audit of a government-owned or controlled bank by an
external independent auditor shall be in addition to and without prejudice to that
conducted by the Commission on Audit in the discharge of its mandate under
existing law. Furthermore, the Circular provides that the requirement for an annual
audit by an external independent auditor shall extend to specialized and unique
government banks such as the Land Bank of the Philippines and the Development
Bank of the Philippines.
The Central Bank promulgated Circular No. 1124 on December 5, 1986 pursuant to
its power under the Freedom Constitution, the fundamental law then in force, as well
as pursuant to its general rule making authority under the General Banking Act (RA
No. 337), the banking law in effect at that time. Under the Freedom Constitution, the
Central Bank exercised supervisory authority over the banking system. Section 14,
Article XV of the 1973 Constitution, which was re-adopted in the Freedom
Constitution, provided as follows:
SEC. 14. The Batasang Pambansa shall establish a central monetary authority which
shall provide policy direction in the areas of money, banking and credit. It shall have
supervisory authority over the operations of banks and exercise such regulatory
authority as may be provided by law over the operations of finance companies and
other institutions performing similar functions. Until the Batasang Pambansa shall
otherwise provide, the Central Bank of the Philippines, operating under existing
laws, shall function as the central monetary authority. (Emphasis supplied)
Section 6-D of the General Banking Act (RA No. 337) vested the Monetary Board
with the specific power to require a bank to engage the services of an independent
auditor to be chosen by the bank concerned from a list of certified public accountants
acceptable to the Monetary Board.
The 1987 Constitution created an independent central monetary authority with
substantially the same powers as the Central Bank under the 1973 Constitution and
the Freedom Constitution. Section 20, Article XII of the 1987 Constitution provides
that the Monetary Board shall have supervision over the operations of banks. The
specific power of the Central Bank under the General Banking Act (RA No. 337) to

require an independent audit of banks was re-enacted in Section 58 of the General


Banking Law of 2000 (RA No. 8791).
Indubitably, the Central Bank had the express constitutional and statutory power to
promulgate Circular No. 1124 on December 5, 1986. The power granted to the
Central Bank to issue Circular No. 1124 with respect to the independent audit of
banks is direct, unambiguous, and beyond dispute. The Bangko Sentral ng Pilipinas,
which succeeded the Central Bank, retained under the 1987 Constitution and the
General Banking Law of 2000 (RA No. 8791) the same constitutional and statutory
power the Central Bank had under the Freedom Constitution and the General
Banking Act (RA No. 337) with respect to the independent audit of banks.
Circular No. 1124 has the force and effect of law. In a long line of decisions,[37] this
Court has held consistently that the rules and regulations issued by the Central Bank
pursuant to its supervisory and regulatory powers have the force and effect of law.
The DBP, being a bank under the constitutional and statutory supervision of the
Central Bank, was under a clear legal obligation to comply with the requirement of
Circular No. 1124 on the private audit of banks. Refusal by the DBP to comply with
the Circular would have rendered the DBP and its officers liable to the penal
provisions of the General Banking Act,[38] as well as the administrative and penal
sanctions under the Central Bank Act.[39]
The DBP also relies on Section 8 of PD No. 2029 as its statutory basis for hiring a
private auditor. This Section states in part as follows:
The audit of government corporations by the Commission on Audit shall not
preclude government corporations from engaging the services of private auditing
firms: Provided, however, that even if the services of the latter are availed of, the
audit report of the Commission on Audit shall serve as the report for purposes of
compliance with audit requirements as required of government corporations under
applicable law.
Section 8 of PD No. 2029, however, also provides that the policy of withdrawal of
resident auditors shall be fully implemented x x x. Section 2 of the same decree also
excludes from the term government-owned or controlled corporation two classes of
corporations. The first are originally private corporations the majority of the shares
of stock of which are acquired by government financial institutions through
foreclosure or dacion en pago. The second are subsidiary corporations of government
corporations, which subsidiaries are organized exclusively to own, manage or lease
physical assets acquired by government financial institutions through foreclosure or
dacion en pago. Claiming that PD No. 2029 operates to exempt certain governmentowned corporations from the COAs jurisdiction in violation of Section 3, Article IXD of the Constitution, the COA is questioning the constitutionality of PD No. 2029.

82

There is, however, no compelling need to pass upon the constitutionality of PD No.
2029 because the Constitution and existing banking laws allow such hiring. The
issues raised in this case can be resolved adequately without resolving the
constitutionality of PD No. 2029. This Court will leave the issue of the
constitutionality of PD No. 2029 to be settled in another case where its resolution is
an absolute necessity.[40]
Third Issue: Necessity of Private Auditor and Reasonableness of the Fees
The remaining issue to be resolved is whether or not the DBPs hiring of a private
auditor was necessary and the fees it paid reasonable under the circumstances. The
hiring by the DBP of a private auditor was a condition imposed by the World Bank
for the grant to the Philippine government in early 1987 of a US$310 million
Economic Recovery Loan, at a time when the government desperately needed funds
to revive a badly battered economy. One of the salient objectives of the US$310
million loan was the rehabilitation of the DBP which was then burdened with
enormous bad loans. The rehabilitation of the DBP was important in the overall
recovery of the national economy.
On February 23, 1986, the World Bank President reported to the Banks Executive
Directors that the privately audited accounts of the DBP for 1986 and 1987 will be a
requirement for the releases of the second and third tranches, respectively, of the
ERL (Emphasis supplied). Moreover, the Agreed Minutes of Negotiations on the
Philippine Economic Recovery Program[41] signed by the Philippine government
and World Bank negotiating panels on January 8, 1987, required that a copy of
COAs letter x x x regarding DBPs appointment of a private external auditor will be
sent to the (World) Bank before the distribution of the loan documents to the Banks
Board, along with a copy of the scope of audit as approved by COA and satisfactory
to the Bank (Emphasis supplied).
As a creditor, the World Bank needed the private audit for its own information to
monitor the progress of the DBPs rehabilitation. This is apparent from the said
Agreed Minutes which provided that the general terms of reference (for the hiring of
private external audit) were discussed during the negotiations and form part of the
World Banks guidelines for financial information on financial institutions[42]
(Emphasis supplied).
The hiring of a private auditor being an express condition for the grant of the
US$310 million Economic Recovery Loan, a major objective of which was the DBPs
rehabilitation, the same was a necessary corporate act on the part of the DBP. The
EN BANC
G.R. No. 204869, March 11, 2014

national government, represented by the Central Bank Governor, as well as the


Ministers of Finance, Trade, and Economic Planning, had already committed to the
hiring by all government banks of private auditors in addition to the COA. For the
DBP to refuse to hire a private auditor would have aborted the vital loan and derailed
the national economic recovery, resulting in grave consequences to the entire nation.
The hiring of a private auditor was not only necessary based on the governments
loan covenant with the World Bank, it was also necessary because it was mandated
by Central Bank Circular No. 1124 under pain of administrative and penal sanctions.
The last matter to determine is the reasonableness of the fees charged by Joaquin C.
Cunanan & Co., the private auditor hired by the DBP. The COA describes the private
auditors fees as an excessive, extravagant or unconscionable expenditure of
government funds. For the audit of the DBPs financial statements in 1986, the
private auditor billed the DBP the amount of P487,321.14.[43] In 1987, the private
auditor billed the DBP the amount of P529,947.00.[44] In comparison, the COA
billed the DBP an audit fee of P27,015,963.00[45] in 1988, and P15,421,662.00[46]
in 1989. Even granting that the COAs scope of audit services was broader,[47] still it
could not be said that the private auditors fees are excessive, extravagant or
unconscionable compared to the COAs billings.
The hiring of a private auditor by the DBP being a condition of the US$310 million
World Bank loan to the Philippine government, the fees of such private auditor are in
reality part of the governments cost of borrowing from the World Bank. The audit
report of the private auditor is primarily intended for the World Banks
information[48] on the financial status of the DBP whose rehabilitation was one of
the objectives of the loan. An annual private audit fee of about half a million pesos
added to the interest on a US$310 million loan would hardly make the cost of
borrowing excessive, extravagant or unconscionable. Besides, the condition imposed
by a lender, whose money is at risk, requiring the borrower or its majority-owned
subsidiaries to submit to audit by an independent public accountant, is a reasonable
and normal business practice.
WHEREFORE, the petition is hereby GRANTED. The letter-decision of the
Chairman of the Commission on Audit dated August 29, 1988, and the letter-decision
promulgated by the Commission on Audit en banc dated May 20, 1989, are hereby
SET ASIDE, and the temporary restraining order issued by the court enjoining
respondent Commission on Audit from enforcing the said decisions is hereby made
PERMANENT.
SO ORDERED.
TECHNICAL EDUCATION AND SKILLS DEVELOPMENT AUTHORITY
(TESDA), Petitioner, v. THE COMMISSION ON AUDIT, CHAIRPERSON MA.
GRACIA M. PULIDO TAN, COMMISSIONER JUANITO G. ESPINO, JR., AND
COMMISSIONER HEIDI L. MENDOZA, Respondents.

83

DECISION
CARPIO, J.:
The Case
This is a petition for certiorari 1 with prayer for issuance of temporary restraining
order or writ of preliminary injunction to annul Decision No. 20122102 of the
Commission on Audit (COA). The COA disallowed payments of Extraordinary and
Miscellaneous Expenses (EME) by the Technical Education and Skills Development
Authority (TESDA) to its officials.
The Facts
Upon post audit, the TESDA audit team leader discovered that for the calendar years
20042007, TESDA paid EME twice each year to its officials from two sources: (1)
the General Fund for locallyfunded projects, and (2) the Technical Education and
Skills Development Project (TESDP) Fund for the foreignassisted projects. The
payment of EME was authorized under the General Provisions of the General
Appropriations Acts of 2004, 2005,3 2006 and 2007 (20042007 GAAs), subject to
certain conditions:chanRoblesvirtualLawlibrary
x x x Extraordinary and Miscellaneous Expenses. Appropriations authorized
herein may be used for extraordinary expenses of the following officials and those of
equivalent rank as may be authorized by the DBM, not exceeding:
(a) P180,000 for each Department Secretary;
(b) P65,000 for each Department Undersecretary;
(c) P35,000 for each Department Assistant Secretary;
(d) P30,000 for each head of bureau or organization of equal rank to a bureau
and for each Department Regional Director;
(e) P18,000 for each Bureau Regional Director; and
(f) P13,000 for each Municipal Trial Court Judge, Municipal Circuit Trial Court
Judge, and Sharia Circuit Court Judge.
In addition, miscellaneous expenses not exceeding Fifty Thousand Pesos
(P50,000) for each of the offices under the above named officials are authorized.4
(Emphasis supplied)
On 15 May 2008, the audit team issued Notice of Disallowance No. 08002101
(0406)5 disallowing the payment of EME amounting to P5,498,706.60 for being in
excess of the amount allowed in the 20042007 GAAs. In addition, the EME were

disbursed to TESDA officials whose positions were not of equivalent ranks as


authorized by the Department of
Budget and Management (DBM), contrary to the provisions of the 20042007
GAAs. Notice of Disallowance No. 08002101 (0406) indicated the persons liable
for the excessive payment of EME: the approving officers, payees and the
accountants.6
On 4 July 2008, TESDA, through its then DirectorGeneral Augusto Boboy Syjuco,
Jr., filed an Appeal Memorandum7 arguing that the 20042007 GAAs and the
Government Accounting and Auditing Manual allowed the grant of EME from both
the General Fund and the TESDP Fund provided the legal ceiling was not exceeded
for each fund. According to TESDA, the General Fund and the TESDP Fund are
distinct from each other, and TESDA officials who were designated as project
officers concurrently with their regular functions were entitled to separate EME from
both funds.
The Ruling of the Commission on Audit
In a Decision dated 5 September 2008,8 the COA Cluster Director, Cluster VII,
National Government Sector, denied the appeal for lack of merit. The COA Cluster
Director ruled that:chanRoblesvirtualLawlibrary
On the first issue, the GAA provision on EME is very clear to the effect that
payment of EME may be taken from any authorized appropriation but shall not
exceed the ceiling stated therein. It had been consistently held that when the
language of the law is clear and unequivocal it should be given its common and
ordinary meaning. If the legislative intent is to grant officials EME of unlimited
amount, no limit or ceiling should have been included in the GAA. On the other
hand, the Audit Team Leader stated that the inclusion in TESDA budget for EME in
TESDP Fund, which was actually found only in the GAA for FY 2005 could not
serve as basis for the grant of EME, should not be treated distinctly and separately
from EME provision under the General Provisions of the GAA as the officials who
were paid the EME from [TESDP Fund] are the same TESDA officials who were
already paid EME out [of the General Fund]. It should be emphasized that the
designation of TESDA officials as Project Managers in concurrent capacities to
offices under TESDP, forms part only of their additional functions without another
appointment. The EME is covered by the compensation attached to his principal
office and not for every project handled. x x x.
On the second issue whether officials who are not of equivalent rank as authorized
by the DBM, the Audit Team Leader informed that the officials were designated for
[positions] which are not included in the Personnel Service Itemization (PSI) and the
creation of said positions [was] not supported with authority or approval from the

84

DBM. Neither was there a DBM document identifying the equivalent ranks of these
positions as basis for ascertaining the amount of EME to be paid.
On the third issue whether the Regional Directors who were not performing as
head of the Bureau or a regional office or organization unit of equal rank, because of
their reassignment to the Office of the Director[]General, the same were not entitled
to receive EME since the Director[]General and its office are already claiming the
said amount. There could be no two officials entitled to receive EME although they
are listed in the GAA as entitled to receive the same.9

C. THE [COA] LIKEWISE GRAVELY ERRED IN HOLDING THAT


CONSIDERING THE CEILING SET FORTH BY SECTIONS 23[, 25] AND 26 OF
THE GENERAL PROVISIONS OF THE [20042007 GAAS], THE CONCERNED
TESDA OFFICIALS CLAIMS FOR EME ARE UNAUTHORIZED AND
EXCESSIVE;
D. FINALLY, THE [COA] GRAVELY ERRED IN HOLDING THAT THE
CONCERNED TESDA OFFICIALS CANNOT BE CONSIDERED AS DE FACTO
OFFICERS IN GOOD FAITH AND IN DISREGARDING THE RELEVANT
RULING OF THE SUPREME COURT IN THE CASE OF CA[N]TILLO VS.
ARRIETA.12

On 4 December 2008, TESDA, through its DirectorGeneral, filed a petition for


review with COA.
The Ruling of the Court
In a Decision dated 15 November 2012,10 COA denied TESDAs petition for lack of
merit. The COA adopted the findings of both the TESDA audit team and the COA
Cluster Director that the grant of EME exceeded the allowable limit in the 2004
2007 GAAs. The COA emphasized that the provision in the 20042007 GAAs that
granted EME clearly provided a ceiling for its grant. Accordingly, the COA ruled that
the failure of the TESDA officials to adhere to the 20042007 GAAs negated their
claim of good faith. Thus, the COA ordered them to refund the excess EME they
received.
In a Resolution dated 12 March 2013,11 the Court En Banc resolved to excuse the
Office of the Solicitor General from representing the COA due to conflict of interest
considering that both COA and TESDA are government agencies being represented
by it.
The Issues
In this petition, TESDA seeks a reversal and raises the following issues for
resolution:chanRoblesvirtualLawlibrary
A. THE [COA] GRAVELY ERRED IN DISALLOWING THE PAYMENTS
MADE BY TESDA TO ITS OFFICIALS OF THEIR [EME] FROM BOTH
[GENERAL FUND] AND [TESDP FUND];
B. THE [COA] LIKEWISE GRAVELY ERRED IN HOLDING THE OFFICERS
OF TESDA INDIVIDUALLY LIABLE FOR THE TOTAL DISALLOWANCE IN
THE AMOUNT OF P5,498,706.60 EVEN IF THEY MAY BE RIGHTFULLY
CONSIDERED AS DE FACTO OFFICERS IN GOOD FAITH WHO ARE
ENTITLED TO EME FOR ACTUAL SERVICES RENDERED;

The petition is partly meritorious.


The Constitution vests COA, as guardian of public funds, with enough latitude to
determine, prevent and disallow irregular, unnecessary, excessive, extravagant or
unconscionable expenditures of government funds.13 The COA is generally
accorded complete discretion in the exercise of its constitutional duty and the Court
generally sustains its decisions in recognition of its expertise in the laws it is
entrusted to enforce.14
Only when COA acts without or in excess of jurisdiction, or with grave abuse of
discretion amounting to lack or excess of jurisdiction, may the Court grant a petition
assailing COAs actions. There is grave abuse of discretion when there is an evasion
of a positive duty or a virtual refusal to perform a duty enjoined by law or to act in
contemplation of law as when the judgment rendered is not based on law and
evidence but on caprice, whim and despotism.15
We do not find any grave abuse of discretion when COA disallowed the
disbursement of EME to TESDA officials for being excessive and unauthorized by
law, specifically the 20042007 GAAs, to wit:chanRoblesvirtualLawlibrary
x x x Extraordinary and Miscellaneous Expenses. Appropriations authorized
herein may be used for extraordinary expenses of the following officials and those of
equivalent rank as may be authorized by the DBM, not exceeding:
(a) P180,000 for each Department Secretary;
(b) P65,000 for each Department Undersecretary;
(c) P35,000 for each Department Assistant Secretary;
(d) P30,000 for each head of bureau or organization of equal rank to a bureau
and for each Department Regional Director;

85

(e) P18,000 for each Bureau Regional Director; and


(f) P13,000 for each Municipal Trial Court Judge, Municipal Circuit Trial Court
Judge, and Sharia Circuit Court Judge.
In addition, miscellaneous expenses not exceeding Fifty Thousand Pesos
(P50,000) for each of the offices under the above named officials are authorized.16
(Boldfacing and italicization supplied)
The GAA provisions are clear that the EME shall not exceed the amounts fixed in the
GAA. The GAA provisions are also clear that only the officials named in the GAA,
the officers of equivalent rank as may be authorized by the DBM, and the offices
under them are entitled to claim EME not exceeding the amount provided in the
GAA.
The COA faithfully implemented the GAA provisions. COA Circular No. 2012
00117 states that the amount fixed under the GAA for the National Government
offices and officials shall be the ceiling in the disbursement of EME. COA Circular
No. 89300,18 prescribing the guidelines in the disbursement of EME, likewise
states that the amount fixed by the GAA shall be the basis for the control in the
disbursement of these funds.
The COA merely complied with its mandate when it disallowed the EME that were
reimbursed to officers who were not entitled to the EME, or who received EME in
excess of the allowable amount. When the law is clear, plain and free from
ambiguity, there should be no room for interpretation but only its application.
However, TESDA insists on its interpretation justifying its payment of EME out of
the TESDP Fund. It argues that the 20042007 GAAs did not prohibit its officials
from receiving additional EME chargeable against an authorized funding, the TESDP
Fund in this case, for another office to which they have been designated.
We do not find merit in TESDAs argument.
The TESDA is an instrumentality of the government established under Republic Act
No. 7796 or the TESDA Act of 1994. Under Section 33 of the TESDA Act, the
TESDA budget for the implementation of the Act is included in the annual GAA;
hence, the TESDP Fund, being sourced from the Treasury, are funds belonging to the
government, or any of its departments, in the hands of public officials.19 The
Constitution provides, No money shall be paid out of the Treasury except in
pursuance of an appropriation made by law.20 The State Audit Code, which
prescribes the guidelines in disbursing public funds, reiterates this important
Constitutional provision that there should be an appropriation law or other statutes
specifically authorizing payment out of any public funds.21

In this case, TESDA failed to point out the law specifically authorizing it to grant
additional reimbursement for EME from the TESDP Fund, contrary to the explicit
requirement in the Constitution and the law. In Yap v. Commission on Audit,22 we
upheld COAs disallowance of medical expenses and other benefits such as car
maintenance, gasoline allowance and drivers subsidy due to petitioners failure to
point out the law specifically authorizing the same. There is nothing in the 2004
2007 GAAs which allows TESDA to grant its officials another set of EME from
another source of fund like the TESDP Fund. COA aptly pointed out that not even
TESDAs inclusion of EME from both the General Fund and the TESDP Fund in the
2005 GAA justified its payment of excessive EME from 2004 up to 2007.23 The
2005 GAA provided for a ceiling on EME that TESDA still had to comply despite
the grant of EME in the 2005 GAA for foreignassisted projects.
The position of project officer is not among those listed or authorized to be entitled
to EME, namely, the officials named in the GAA, the officers of equivalent rank as
may be authorized by the DBM, and the offices under them. The underlying
principle behind the EME is to enable those occupying key positions in the
government to meet various financial demands.24 As pointed out by COA, the
position of project officer is not even included in the Personnel Service Itemization
or created with authority from the DBM.25 Thus, the TESDA officials were, in fact,
merely designated with additional duties, which designation did not entitle them to
additional EME. In Dimaandal v. COA,26 we held that designation is a mere
imposition of additional duties, which does not entail payment of additional benefits.
Since the TESDA officials were merely designated with additional duties, the ruling
in Cantillo v. Arrieta27 on de facto officers need not be discussed.
Having settled that COA properly disallowed the payment of excessive EME by
TESDA, we proceed to determine whether the TESDA officials should refund the
excess EME granted to them.
In Blaquera v. Alcala,28 the Court no longer required the officials and employees of
different government departments and agencies to refund the productivity incentive
bonus they received because there was no indicia of bad faith and the disbursement
was made in the honest belief that the recipients deserved the amounts. We, however,
qualified this Blaquera ruling in Casal v. COA,29 where we held the approving
officials liable for the refund of the incentive award due to their patent disregard of
the issuances of the President and the directives of COA. In Casal, we ruled that the
officials failure to observe the issuances amounted to gross negligence, which is
inconsistent with the presumption of good faith. We applied the Casal ruling in
Velasco v. COA,30 to wit:chanRoblesvirtualLawlibrary
x x x the blatant failure of the petitionersapproving officers to abide with the
provisions of AO 103 and AO 161 overcame the presumption of good faith. The

86

deliberate disregard of these issuances is equivalent to gross negligence amounting to


bad faith. Therefore, the petitionersapproving officers are accountable for the
refund of the subject incentives which they received.
However, with regard to the employees who had no participation in the approval
of the subject incentives, they were neither in bad faith nor were they grossly
negligent for having received the benefits under the circumstances. The approving
officers allowance of the said awards certainly tended to give it a color of legality
from the perspective of these employees. Being in good faith, they are therefore
under no obligation to refund the subject benefits which they received.31 (Emphasis
supplied)
Applying by analogy the Blaquera, Casal and Velasco rulings, as well as Section 16
of the 2009 Rules and Regulations on Settlement of Accounts,32 we hold the
approving officers of TESDA liable for the excess EME received by them.
The TESDA Act provides that the TESDA Secretariat, headed by the Director
General, shall propose the specific allocation of resources for the programs and
projects it shall undertake pursuant to approved national technical education and
skills development plan.33 As chief executive officer of the TESDA Secretariat, the
DirectorGeneral shall likewise exercise general supervision and control over its
technical and administrative personnel.34
In the petition filed before the Court, TESDA alleged that the various memoranda
issued by the DirectorGeneral authorized the TESDA officials designated as TESDP
project officers to claim EME under the TESDP Fund.35 TESDA did not cite a
specific provision of law authorizing such EME, but claimed that its grant had been
an institutional practice,36 showing the lack of statutory authority to pay such
EME. Despite this lack of authority for granting additional EME, the then Director
General still permitted EME in excess of the allowable amount and extended EME to
officials not entitled to it, patently contrary to the 20042007 GAAs. The then
DirectorGeneral himself received EME from the TESDP Fund amounting to
[G.R. No. 146486. March 4, 2005]
OFFICE OF THE OMBUDSMAN, petitioner, vs. HONORABLE COURT OF
APPEALS AND FORMER DEPUTY OMBUDSMAN FOR THE VISAYAS
ARTURO C. MOJICA, respondents.
DECISION
CHICO-NAZARIO, J.:

P809,691.11,37 contrary to his claim that only executive directors, regional directors
or officials holding equivalent positions assigned by him as project officers were
entitled to EME from the TESDP Fund.38 The then DirectorGeneral likewise
insisted on his own interpretation of the 20042007 GAAs disregarding the basic
principle of statutory construction that when the law is clear, there should be no
room for interpretation but only its application. If there was any ambiguity in the
law, the then DirectorGeneral should have sought clarification from DBM and
should not have simply relied on his own interpretation, which was selfserving.
Accordingly, the DirectorGenerals blatant violation of the clear provisions of the
Constitution, the 20042007 GAAs and the COA circulars is equivalent to gross
negligence amounting to bad faith. He is required to refund the EME he received
from the TESDP Fund for himself. As for the TESDA officials who had no
participation in the approval of the excessive EME, they acted in good faith since
they had no hand in the approval of the unauthorized EME. They also honestly
believed that the additional EME were reimbursement for their designation as project
officers by the DirectorGeneral. Being in good faith, they need not refund the
excess EME they received.
WHEREFORE, we AFFIRM the Commission on Audit Decision No. 2012210
dated 15 November 2012 with MODIFICATION. Only the DirectorGenerals39 of
the Technical Education and Skills Development Authority who approved the excess
or unauthorized extraordinary and miscellaneous expenses are ordered to refund the
excess extraordinary and miscellaneous expenses which they received for
themselves.
SO ORDERED.
Sereno, C.J., Velasco, Jr., LeonardoDe Castro, Peralta, Bersamin, Del Castillo,
Abad, Villarama, Jr., Perez, Mendoza, Reyes, PerlasBernabe, and Leonen, JJ.,
concur.
Brion, J., I dissent.
This is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, and alternatively, an original special civil action for certiorari under Sec.
1, Rule 65 of the Decision[1] of the Court of Appeals of 18 December 2000 in CAG.R. SP No. 58460 entitled, Arturo C. Mojica, Deputy Ombudsman for the Visayas
v. Ombudsman Aniano Desierto, Over-all Deputy Ombudsman Margarito Gervacio,
Jr. and the Committee of Peers composed of Deputy Ombudsman Jesus F. Guerrero,
Deputy Ombudsman Rolando Casimiro and Special Prosecutor Leonardo P. Tamayo.
The case had its inception on 29 December 1999, when twenty-two officials and
employees of the Office of the Deputy Ombudsman (OMB) for the Visayas, led by
its two directors, filed a formal complaint[2] with the Office of the Ombudsman

87

requesting an investigation on the basis of allegations that then Deputy Ombudsman


for the Visayas, herein private respondent Arturo Mojica, committed the following:

Ombudsman in his Memorandum dated March 27, 2000 (in reiteration of the March
13, 2000 Order of Overall Deputy Ombudsman) -

1.

Acting on your query as to whether or not the Ombudsman confirms or affirms the
disapproval by Overall Deputy Ombudsman Margarito P. Gervacio, Jr., of your
recommendation to conduct instead an investigation of the complaint against Deputy
Ombudsman Arturo C. Mojica solely for the purpose of impeachment, I hereby
confirm the action of disapproval.

Sexual harassment against Rayvi Padua-Varona;

2.
Mulcting money from confidential employees James Alueta and Eden Kiamco;
and
3.
Oppression against all employees in not releasing the P7,200.00 benefits of
OMB-Visayas employees on the date the said amount was due for release.
The complainants further requested that an officer-in-charge from the OMB-Manila
be appointed to manage their office to prevent the Deputy Ombudsman from
harassing witnesses and wielding his influence over them. To underscore the
seriousness of their intentions, they threatened to go on a mass leave of absence, and
in fact took their cause to the media.[3]
The subsequent events, as stated by the Ombudsman and adopted by the Court of
Appeals,[4] are as follows:
The Ombudsman immediately proceeded to the OMB-Visayas office in Cebu City to
personally deal with the office rebellion. Reaching Cebu, the Ombudsman was
informed by Petitioner that Petitioner wanted to proceed to Manila, apparently
because of his alienation and the fear for reprisal from his alleged lady victims
husbands. Petitioner in fact already had a ticket for the plane leaving two hours later
that day. The Ombudsman assented to the quick movement to Manila for Petitioners
safety and the interest of the Offices operations. Subsequently, the Ombudsman
installed Assistant Ombudsman Nicanor J. Cruz as the Officer-in-Charge of OMBVisayas.

xxx
Moreover, as demonstrated in many previous cases against Deputy Ombudsman
Arturo C. Mojica, Deputy Ombudsman Manuel B. Casaclang, Deputy Ombudsman
Jesus F. Guerrero, Special Prosecutor Leonardo P. Tamayo and former Overall
Deputy Ombudsman Francisco A. Villa, the official position of the Office is that the
Constitution, R.A. 6770 and the Supreme Court in Zaldivar vs. Gonzales, G.R. No.
80578, 19 May 1988, exclude the Deputy Ombudsman and the Special Prosecutor
from the list of impeachable officials and the Jarque case involves Ombudsman
Aniano A. Desierto as respondent, hence, the mention therein of the Deputy
Ombudsmen is merely an obiter dictum. Two of your present members in fact
participated in the investigation of the previous Mojica cases and thereafter
recommended the dismissal thereof for lack of merit.
In the same Memorandum, the Ombudsman directed the Committee of Peers to
evaluate the merits of the case and if warranted by evidence, to conduct
administrative and criminal investigation(s) immediately thereafter. Upon evaluation,
the Committee recommended the docketing of the complaint as criminal and
administrative cases. The Committee of Peers Evaluation dated 30 March 2000,
stated as follows:

Acting on the formal complaint against petitioner, the Ombudsman directed his FactFinding and Intelligence Bureau (FFIB) to conduct a verification and fact-finding
investigation on the matter. The FFIB, later in its Report, found the evidence against
Petitioner strong on the charges of acts of extortion, sexual harassment and
oppression. The FFIB report was referred by the Ombudsman to a constituted
Committee of Peers composed of the Deputy Ombudsman for Luzon, The Special
Prosecutor and the Deputy Ombudsman for the Military.

On the basis of the foregoing facts, duly supported with sworn-statements executed
by all concerned parties, the undersigned members of the COP find sufficient cause
to warrant the conduct of preliminary investigation and administrative adjudication
against Deputy Ombudsman Arturo C. Mojica for the following criminal and
administrative offenses, namely:

The Committee of Peers initially recommended that the investigation be converted


into one solely for purposes of impeachment. However, this recommendation was
denied by the Ombudsman after careful study, and following the established stand of
the Office of the Ombudsman that the Deputy Ombudsmen and The Special
Prosecutor are not removable through impeachment. As succintly (sic) stated by the

Violation of Section 3, paragraph[s] (b) and (e) of R.A. 3019 (Anti-Graft and Corrupt
Practices Act);

I. CRIMINAL

Violation of R.A. 7877 (Anti-Sexual Harassment Act of 1995),


II. ADMINISTRATIVE

88

a.

Dishonesty

b.

Grave Misconduct

c.

Oppression

d.

Conduct grossly prejudicial to the best interest of the service

Aggrieved, the private respondent filed a petition[9] for Certiorari before the Court
of Appeals praying that a resolution be issued:
1. . . . issuing a Temporary Restraining Order (TRO) upon the filing of the petition to
enjoin and restrain the respondents, (the Ombudsman, the Over-all Deputy
Ombudsman, the Committee of Peers, and the Special Prosecutor) their agents and
representatives, from suspending the petitioner (herein private respondent Mojica);

e.
Directly or indirectly having financial and material interest in any
transaction requiring the approval of his Office; (Section 22, paragraphs (A), (C),
(N), (T) and (U), Rule XIV of Executive Order No. 292, otherwise known as the
Administrative Code of 1987.)

2. thereafter, converting said TRO into a Writ of Preliminary Injunction;

Accordingly, let the instant case be docketed separately, one for the criminal case and
another for the administrative case covering all the offenses specified above and,
thereafter, a formal investigation be simultaneously and jointly conducted by the
Committee of Peers, pursuant to Administrative Order No. 7.

a. detailing and assigning indefinitely the petitioner to OMB-Manila in a [special]


capacity, thus effectively demoting/suspending petitioner, and preventing him from
preparing his defense;

Accordingly, on 6 April 2000, the Committee of Peers (COP) directed the herein
private respondent Mojica in OMB-0-00-0615 entitled, Padua-Varona v. Mojica, for
violation of Republic Act No. 7877 (Anti-Sexual Harassment Act of 1995) and Sec.
3, par. (b) and (c) of Rep. Act No. 3019 (Anti-Graft and Corrupt Practices Act) to
submit his controverting evidence.
On 10 April 2000, the complainants in OMB-0-00-0615 filed a Motion to Place
Respondent Under Preventive Suspension,[5] claiming that the offenses for which
private respondent Mojica was charged warranted removal from office, the evidence
against him was strong, and that Mojicas continued stay in office would prejudice the
case, as he was harassing some witnesses and complainants to recant or otherwise
desist from pursuing the case.
On the same date, the Ombudsman issued a Memorandum[6] to the COP, directing
them to conduct administrative proceedings in OMB-ADM-0-00-0316 entitled,
OMB Visayas Employees v. Mojica (for dishonesty, grave misconduct, oppression,
conduct grossly prejudicial to the best interest of the service, and directly or
indirectly having financial and material interest in any transaction requiring the
approval of his office), and submit a recommendation on the propriety of putting
Mojica under preventive suspension.
Subsequently, the COP issued an Order[7] in OMB-ADM-0-00-0316 finding prima
facie evidence against Mojica and requiring him to submit an answer to the abovementioned offenses within ten days, as well as his counter-affidavit and supporting
evidence.[8]

3. after hearing, a decision be rendered declaring the following acts of the


Ombudsman null and void ab initio:

b. authorizing or directing the docketing of the complaints against the petitioner,


which is equivalent to authorizing the filing of the administrative and/or criminal
cases against the petitioner, who is an impeachable official;
c. denying the request of petitioner for leave of absence, which acts were done
without lawful authority, in a malevolent and oppressive manner and without
jurisdiction.
On 04 May 2000, the Court of Appeals resolved to grant the prayer for Temporary
Restraining Order and required the Ombudsman to comment and show cause why no
writ of preliminary injunction should be issued, which reads in part:
Meanwhile, to maintain the status quo and in order to forestall the petition at bench
from becoming moot and academic, and considering that upon examination of the
records we believe that there is an urgent need for the issuance of a temporary
restraining order to prevent great and irreparable injury that would result to herein
petitioner before the matter could be heard on notice, the herein respondents, their
agents and representatives acting for and in their behalf or under their authority, are
hereby enjoined and restrained from proceeding with the hearing of the Motion to
Place Respondent Under Preventive Suspension dated April 10, 2000, which hearing
is set on May 9, 2000 at 2:00 oclock in the afternoon and/or from conducting any
further proceedings relative to the suspension from (o)ffice of the herein petitioner
until further order and/or notice from this Court.[10]
Nevertheless, on 6 June 2000, the COP issued an Order[11] in both OMB-0-00-0615
and OMB-ADM-0-00-0316 to the effect that having failed to submit the required

89

counter-affidavits despite the lapse of seventeen days from the expiration of the
extended reglementary period for filing the same, respondent Mojica was deemed to
have waived his right to present his evidence. The COP thus deemed both criminal
and administrative cases submitted for resolution on the basis of the evidence on
record.
Thus, on 13 June 2000, the private respondent thus filed an urgent motion[12] before
the Court of Appeals to enjoin the Ombudsman from taking any action whatsoever in
the criminal and administrative cases aforementioned. The following day, the private
respondent filed another urgent motion, this time praying that the Court of Appeals
issue an order requiring the Ombudsman to show cause why it should not be cited for
contempt for failing to conform with the 4 May 2000 Resolution of the Court of
Appeals. On 20 June 2000, the Court of Appeals directed[13] the Ombudsman to
comment on the above pleadings, and to comply with the formers Temporary
Restraining Order of 4 May 2000.
The parties subsequently exchanged various pleadings that culminated in a
Resolution[14] by the Court of Appeals on 5 July 2000 that, among other things,
directed the issuance of a writ of preliminary injunction enjoining all therein
respondents from taking any action whatsoever in cases No. OMB-0-00-0615
(criminal) and No. OMB-ADM-0-00-0316 (administrative) against Mojica, and
deemed the instant petition submitted for resolution on the merits upon the
submission of the comment or explanation on the appellate courts show cause
Resolution of 20 June 2000.
Meanwhile, on 19 June 2000, the Office of the Deputy Ombudsman for the Military
directed the private respondent Mojica ostensibly to answer a different set of charges
for violation of Art. 266 and Sec. 3(e) of Rep. Act No. 3019 (OMB-00-0-1050) and
for grave misconduct, gross neglect of duty, and conduct prejudicial to the best
interest of the service[15] (OMB-ADM-0-00-0506). Feeling that this was merely an
attempt at circumventing the directives of the Court of Appeals, Mojica filed an
urgent motion before the Court of Appeals for respondents to show cause again why
they should not be cited for contempt.
By way of opposition, the Ombudsman pointed out that the writ of preliminary
injunction issued by the appellate court was against any action taken in cases No.
OMB-0-00-0615 and No. OMB-ADM-0-00-0316, and not against any new cases
filed against the private respondent thereafter. The Ombudsman further pointed out
that since Mojicas term of office had already expired as of 6 July 2000, the private
respondent could no longer invoke his alleged immunity from suit.

August 2000, the private respondent filed an urgent motion for the immediate
issuance of an order enjoining the Ombudsman from taking any further action
whatsoever in OMB-ADM-0-00-0506 and OMB-0-00-1050.[16]
On 18 December 2000, despite the expiration of private respondent Mojicas term of
office, the Court of Appeals nevertheless rendered the assailed Decision[17] on the
grounds of public interest.
In essence, the appellate court held that although the 1987 Constitution, the
deliberations thereon, and the commentaries of noted jurists, all indicate that a
Deputy Ombudsman is not an impeachable official, it was nevertheless constrained
to hold otherwise on the basis of this Courts past rulings. Thus, the dispositive
portion thereof reads:
WHEREFORE, in view of the foregoing, the order of the Committee of Peers in its
Evaluation dated March 30, 2000 directing the docketing separately of the criminal
case as well as the administrative case against the petitioner is hereby SET ASIDE
and DECLARED NULL AND VOID. Accordingly, the complaints in Criminal Case
No. OMB-0-00-0615 and Administrative Case No. OMB-ADM-0-00-0316,
respectively, filed against the petitioner are hereby DISMISSED. All acts or orders of
the Ombudsman, the Overall Deputy Ombudsman and the Committee of Peers,
subjecting the petitioner [herein private respondent] to criminal and administrative
investigations, or pursuant to such investigations, are likewise hereby DECLARED
INVALID.[18]
Thereupon, on 15 January 2001, the Office of the Ombudsman filed before this
Court a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, and alternatively, an original special civil action for certiorari under Sec.
1, Rule 65 of the same rules, of the above decision, on the following grounds:
I
THE HONORABLE COURT OF APPEALS GRAVELY ABUSED ITS
DISCRETION IN ERRONEOUSLY RULING THAT PRIVATE RESPONDENT, AS
THEN DEPUTY OMBUDSMAN FOR THE VISAYAS, IS AN IMPEACHABLE
OFFICIAL, CONSIDERING THAT THE PLAIN TEXT OF SEC. 2, ART. XI OF
THE 1987 CONSTITUTION, AS WELL AS THE INTENT OF THE FRAMERS
THEREOF, EXCLUDES A DEPUTY OMBUDSMAN FROM THE LIST OF
IMPEACHABLE OFFICIALS.
II

On 14 August 2000, the Office of the Deputy Ombudsman for the Military issued an
order deeming that cases No. OMB-0-00-1050 and No. OMB-ADM-0-00-0506 had
been deemed submitted for resolution on the basis of the evidence at hand. On 17

THE PRINCIPLE OF STARE DECISIS ET NON QUIETA MOVERE MAY NOT


BE INVOKED TO PERPETUATE AN ERRONEOUS OBITER DICTUM.

90

III
THE HONORABLE COURT OF APPEALS HAS NO JURISDICTION TO ORDER
THE DISMISSAL OF A CRIMINAL CASE AGAINST A RETIRED DEPUTY
OMBUDSMAN, WHICH IS STILL PENDING PRELIMINARY INVESTIGATION
BEFORE PETITIONER OMBUDSMAN.[19]
At the outset, it bears noting that instead of assailing the Court of Appeals Decision
solely by petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, petitioner lodged the present petition alternatively as an original special
civil action for certiorari under Sec. 1, Rule 65 of the same rules.
It is settled that the appeal from a final disposition of the Court of Appeals is a
petition for review under Rule 45 and not a special civil action under Rule 65 of the
1997 Rules of Civil Procedure. Rule 45 is clear that the decisions, final orders or
resolutions of the Court of Appeals in any case, i.e., regardless of the nature of the
action or proceeding involved, may be appealed to this Court by filing a petition for
review, which would be but a continuation of the appellate process over the original
case. Under Rule 45, the reglementary period to appeal is fifteen (15) days from
notice of judgment or denial of motion for reconsideration.[20]
The records show that following the petitioners receipt on 5 January 2001 of a copy
the Court of Appeals Decision, it filed the present petition on 16 January 2001, well
within the reglementary period so indicated.
We go now into the substantive aspect of this case, where we are presented an attack
upon a prior interpretation of Article XI, Sec. 2 in relation to Article XI, Sec. 8 of our
Constitution.
The interpretation in question first appears in Cuenco v. Fernan,[21] a disbarment
case against then Associate Justice Marcelo Fernan filed by Atty. Miguel Cuenco, a
former member of the House of Representatives, where we held in part:
There is another reason why the complaint for disbarment here must be dismissed.
Members of the Supreme Court must, under Article VIII (7)(1) of the Constitution,
be members of the Philippine Bar and may be removed from office only by
impeachment (Article XI [2], Constitution). To grant a complaint for disbarment of a
Member of the Court during the Members incumbency, would in effect be to
circumvent and hence to run afoul of the constitutional mandate that Members of the
Court may be removed from office only by impeachment for and conviction of
certain offenses listed in Article XI (2) of the Constitution. Precisely the same
situation exists in respect of the Ombudsman and his deputies (Article XI [8] in
relation to Article XI [2], id.), a majority of the members of the Commission on

Elections (Article IX [C] [1] [1] in relation to Article XI [2], id.), and the members of
the Commission on Audit who are not certified public accountants (Article XI [D]
[1] [1], id.), all of whom are constitutionally required to be members of the
Philippine Bar. (Emphasis supplied.)
Barely two months later, we issued another Resolution in In Re: Raul M. Gonzales,
[22] concerning the same charges for disbarment brought against Justice Fernan,
wherein we cited the above ruling to underscore the principle involved in the case,
that [a] public officer who under the Constitution is required to be a member of the
Philippine Bar as a qualification for the office held by him and who may be removed
from office only by impeachment, cannot be charged with disbarment during the
incumbency of such public officer.[23]
In 1995, we subsequently anchored our Resolution in Jarque v. Desierto,[24] a
disbarment case against then Ombudsman Aniano Desierto, on the above ruling,
adding that:
. . . [T]he court is not here saying that the Ombudsman and other constitutional
officers who are required by the Constitution to be members of the Philippine Bar
and are remova[ble] only by impeachment, are immunized from liability possibly for
criminal acts or for violation of the Code of Professional Responsibility or other
claimed misbehavior. What the Court is saying is that there is here a fundamental
procedural requirement which must be observed before such liability may be
determined and enforced. The Ombudsman or his deputies must first be removed
from office via the constitutional route of impeachment under Sections 2 and 3 of
Article XI of the 1987 Constitution. Should the tenure of the Ombudsman be thus
terminated by impeachment, he may then be held to answer either criminally or
administratively e.g., in disbarment proceedings for any wrong or misbehavior which
may be proven against him in appropriate proceedings. (Emphasis supplied)
Finally, in Lastimosa-Dalawampu v. Deputy Ombudsman Mojica and Graft
Investigator Labella,[25] the Court, citing its Resolution in Jarque v. Desierto,[26]
dismissed, in a minute resolution, the complaint for disbarment against the herein
private respondent Mojica in his capacity as Deputy Ombudsman for the Visayas,
stating that:
Anent the complaint for disbarment against respondent Arturo C. Mojica in his
capacity as Deputy Ombudsman for Visayas, suffice it to state that a public officer
whose membership in the Philippine Bar is a qualification for the office held by him
and removable only by impeachment cannot be charged with disbarment during his
membership (In Re: Raul M. Gonzales, 160 SCRA 771, 774 [1988]; Cuenco vs.
Fernan, 158 SCRA 29, 40 [1988]). And we have held in the case of Jarque vs.
Desierto (A.C. No. 4509, En Banc Resolution December 5, 1995), that the
Ombudsman or his deputies must first be removed from office via impeachment

91

before they may be held to answer for any wrong or misbehavior which may be
proven against them in disbarment proceedings.
The above Resolution was subsequently made the basis of the appellate courts
assailed Decision of 18 December 2000. Thus, in holding that a Deputy Ombudsman
is an impeachable officer, the appellate court stated that it had to defer to the loftier
principle of adherence to judicial precedents, otherwise known as the doctrine of
Stare Decisis.... necessary for the uniformity and continuity of the law and also to
give stability to society.[27]
Nevertheless, the court a quo took pains to point out that the 1987 Constitution, the
deliberations thereon, and the opinions of constitutional law experts all indicate that
the Deputy Ombudsman is not an impeachable officer.
Is the Deputy Ombudsman, then, an impeachable officer? Section 2, Article XI of the
1987 Constitution, states that:
Sec. 2. The President, the Vice-President, the members of the Supreme Court, the
members of the Constitutional Commissions, and the Ombudsman may be removed
from office, on impeachment for, and conviction of, culpable violation of the
Constitution, treason, bribery, graft and corruption, other high crimes, or betrayal of
public trust. All other public officers and employees may be removed from office as
provided by law, but not by impeachment.
To determine whether or not the Ombudsman therein mentioned refers to a person or
to an office, reference was made by the appellate court to the Records of the
Constitutional Commission, as well as to the opinions of leading commentators in
constitutional law. Thus:
. . . It appears that the members of the Constitutional Commission have made
reference only to the Ombudsman as impeachable, excluding his deputies. The
pertinent portions of the record read, to wit:
...
MR. REGALADO. Yes, thank you.
On Section 10, regarding the Ombudsman, there has been concern aired by
Commissioner Rodrigo about who will see to it that the Ombudsman will perform
his duties because he is something like a guardian of the government. This recalls the
statement of Juvenal that while the Ombudsman is the guardian of the people, Quis
custodiet ipsos custodies, who will guard the guardians? I understand here that the
Ombudsman who has the rank of a chairman of a constitutional commission is also
removable only by impeachment.

MR. ROMULO. That is the intention, Madam President.


MR. REGALADO. Only the Ombudsman?
MR. MONSOD. Only the Ombudsman.
MR. REGALADO. So not his deputies, because I am concerned with the phrase
have the rank of. We know, for instance, that the City Fiscal of Manila has the rank
of a justice of the Intermediate Appellate Court, and yet he is not a part of the
judiciary. So I think we should clarify that also and read our discussions into the
Record for purposes of the Commission and the Committee.
MR. ROMULO. Yes. If I may just comment: the Ombudsman in this provision is a
rank in itself really. That is how we look at it. But for purposes of government
classification and salary, we thought we have to give him a recognizable or an
existing rank as a point of reference more than anything else.
MR. REGALADO. Yes, but my concern is whether or not he is removable only by
impeachment, because Section 2 enumerates the impeachable officials, and it does
not mention public officers with the rank of constitutional commissioners.
MR. ROMULO. But we do mention them as the Ombudsman is mentioned in that
enumeration. We used the word Ombudsman because we would like it to be his title;
we do not want him called Chairman or Justice. We want him called Ombudsman.
...
(Records of the 1986 Constitutional Commission, Vol. II, July 26, 1986, pp. 273274)
MR. DAVIDE. I will not insist.
On lines 13 and 14, I move for the deletion of the words and the Ombudsman. The
Ombudsman should not be placed on the level of the President and the VicePresident, the members of the judiciary and the members of the Constitutional
Commissions in the matter of removal from office.
MR. MONSOD. Madam President.
THE PRESIDENT. Commissioner Monsod is recognized.

92

MR. MONSOD. We regret we cannot accept the amendment because we feel that the
Ombudsman is at least on the same level as the Constitutional Commissioners and
this is one way of insulating it from politics.

MR. DAVIDE. Yes, Madam President.

MR. DAVIDE. Madam President, to make the members of the Ombudsman


removable only by impeachment would be to enshrine and install an officer whose
functions are not as delicate as the others whom we wanted to protect from
immediate removal by way of an impeachment.

THE PRESIDENT. Commissioner Rodrigo is recognized.

MR. RODRIGO. Before we vote on the amendment, may I ask a question?

MR. RODRIGO. The Ombudsman, is this only one man?


MR. DAVIDE. Only one man.

MR. MONSOD. We feel that an officer in the Ombudsman, if he does his work well,
could be stepping on a lot of toes. We would really prefer to keep him there but we
would like the body to vote on it, although I would like to ask if we still have a
quorum, Madam President.
THE PRESIDENT. Do we have a quorum? There are members who are in the
lounge.

MR. RODRIGO. Not including his deputies.


MR. MONSOD. No.
...
(Ibid., p. 305, emphasis supplied)

The Secretary-General and the pages conduct an actual count of the Commissioners
present.
THE PRESIDENT. We have a quorum.
MR. MONSOD. May we restate the proposed amendment for the benefit of those
who were not here a few minutes ago.
MR. DE LOS REYES. Madam President, parliamentary inquiry. I thought that
amendment was already covered in the amendment of Commissioner Rodrigo. One
of those amendments proposed by Commissioner Rodrigo was to delete the word
Ombudsman and, therefore, we have already voted on it.
MR. DAVIDE. Madam President, may I comment on that.
THE PRESIDENT. Yes, the Gentleman may proceed.
MR. DAVIDE. The proposed amendment of Commissioner Rodrigo was the total
deletion of the Office of the Ombudsman and all sections relating to it. It was
rejected by the body and, therefore, we can have individual amendments now on the
particular sections.
THE PRESIDENT. The purpose of the amendment of Commissioner Davide is not
just to include the Ombudsman among those officials who have to be removed from
office only on impeachment. Is that right?

Moreover, this Court has likewise taken into account the commentaries of the
leading legal luminaries on the Constitution as to their opinion on whether or not the
Deputy Ombudsman is impeachable. All of them agree in unison that the
impeachable officers enumerated in Section 2, Article XI of the 1986 Constitution is
exclusive. In their belief, only the Ombudsman, not his deputies, is impeachable.
Foremost among them is the erudite Justice Isagani A. Cruz (ret.), who opined:
The impeachable officers are the President of the Philippines, the Vice-President, the
members of the Supreme Court, the members of the Constitutional Commissions,
and the Ombudsman. (see Art. XI, Sec. 2) The list is exclusive and may not be
increased or reduced by legislative enactment. The power to impeach is essentially a
non-legislative prerogative and can be exercised by the Congress only within the
limits of the authority conferred upon it by the Constitution. This authority may not
be expanded by the grantee itself even if motivated by the desire to strengthen the
security of tenure of other officials of the government.
It is now provided by decree (see P.D. No. 1606) that justices of the Sandiganbayan
may be removed only through process of impeachment, the purpose evidently being
to withdraw them from the removal power of the Supreme Court. This prohibition is
of dubious constitutionality. In the first place, the list of impeachable officers is
covered by the maxim expressio unius est exclusio alterius. Secondly, Article VIII,
Section 11, of the Constitution states that all judges of inferior courts and this would
include the Sandiganbayan are under the disciplinary power of the Supreme Court

93

and may be removed by it. This view is bolstered by the last sentence of Article XI,
Section 2, which runs in full as follows:

constitutionally required to be members of the Philippine Bar.[30] (Emphasis


supplied)

Sec. 2. The President, the Vice-President, the members of the Supreme Court, the
members of the Constitutional Commissions, and the Ombudsman may be removed
from office, on impeachment for and conviction of, culpable violation of the
Constitution, treason, bribery, graft and corruption, other high crimes, or betrayal of
public trust. All other public officers and employees may be removed from office as
provided by law, but not by impeachment. (Cruz, Isagani A., Philippine Political
Law, 1996 ed., pp. 333-334)

In cross-referencing Sec. 2, which is an enumeration of impeachable officers, with


Sec. 8, which lists the qualifications of the Ombudsman and his deputies, the
intention was to indicate, by way of obiter dictum, that as with members of this
Court, the officers so enumerated were also constitutionally required to be members
of the bar.

Equally worth noting is the opinion of no less than Rev. Fr. Joaquin G. Bernas, S.J.,
himself who was a member of the Constitutional Commission which drafted the
1987 Constitution, (who) asserted:
Q. Is the list of officers subject to impeachment found in Section 2 exclusive?
A. As presently worded, yes.
(Bernas, Joaquin G., S.J., The 1987 Philippine Constitution, A Reviewer-Primer,
1997 ed., p. 401)
Last but certainly not the least is the equally erudite Representative Antonio B.
Nachura himself, who, as a professor of law, commented that the enumeration of
impeachable officers in Section 2, Article XI of the 1987 Constitution, is exclusive.
(Nachura, Antonio B., Outline/Reviewer in Political Law, 1998 ed., p. 192)[28]
From the foregoing, it is immediately apparent that, as enumerated in Sec. 2 of
Article XI of the 1987 Constitution, only the following are impeachable officers: the
President, the Vice President, the members of the Supreme Court, the members of the
Constitutional Commissions, and the Ombudsman.[29]
How then to explain our earlier pronouncement in Cuenco v. Fernan, as later cited in
In Re: Raul M. Gonzales, Jarque v. Desierto and Lastimosa-Dalawampu v. Dep.
Ombudsman Mojica and Graft Investigator Labella? By way of reiteration, said
Resolution reads in part:
. . . To grant a complaint for disbarment of a Member of the Court during the
Members incumbency, would in effect be to circumvent and hence to run afoul of the
constitutional mandate that Members of the Court may be removed from office only
by impeachment for and conviction of certain offenses listed in Article XI [2] of the
Constitution. Precisely the same situation exists in respect of the Ombudsman and
his deputies (Article XI [8] in relation to Article XI [2]), . . . all of whom are

A dictum is an opinion that does not embody the resolution or determination of the
court, and made without argument, or full consideration of the point. Mere dicta are
not binding under the doctrine of stare decisis.[31]
The legal maxim "stare decisis et non quieta movere" (follow past precedents and do
not disturb what has been settled) states that where the same questions relating to the
same event have been put forward by parties similarly situated as in a previous case
litigated and decided by a competent court, the rule of stare decisis is a bar to any
attempt to relitigate the same issue.[32]
The succeeding cases of In Re: Raul M. Gonzales and Jarque v. Desierto do not
tackle the impeachability of a Deputy Ombudsman either. Nor, for that matter, does
Lastimosa-Dalawampu v. Deputy Ombudsman Mojica and Graft Investigator
Labella, which, as previously mentioned, is a minute resolution dismissing a
complaint for disbarment against the herein private respondent on the basis of the
questioned obiter in Cuenco v. Fernan and the succeeding cases without going into
the merits.
Thus, where the issue involved was not raised nor presented to the court and not
passed upon by the court in the previous case, the decision in the previous case is not
stare decisis of the question presented.[33]
As to whether or not the private respondent, then Deputy Ombudsman for the
Visayas, may be held criminally and/or administratively liable, we likewise resolve
the issue in favor of the petitioner.
The rule that an impeachable officer cannot be criminally prosecuted for the same
offenses which constitute grounds for impeachment presupposes his continuance in
office.[34] Hence, the moment he is no longer in office because of his removal,
resignation, or permanent disability, there can be no bar to his criminal prosecution
in the courts.[35]
Nor does retirement bar an administrative investigation from proceeding against the
private respondent, given that, as pointed out by the petitioner, the formers

94

retirement benefits have been placed on hold in view of the provisions of Sections
12[36] and 13[37] of the Anti-Graft and Corrupt Practices Act.

REINSTATED and the Office of the Ombudsman is ordered to proceed with the
investigation relative to the above cases.

WHEREFORE, the Order of the Court of Appeals dated 18 December 2000 is


hereby REVERSED and SET ASIDE. The complaints in Criminal Case No. OMB-000-0615 and Administrative Case No. OMB-ADM-0-00-0316 are hereby
MA. MERCEDITAS N. GUTIERREZ

SO ORDERED.
Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.

Petitioner,
G.R. No. 193459

- versus Present:

THE HOUSE OF REPRESENTATIVES COMMITTEE ON JUSTICE, RISA


HONTIVEROS-BARAQUEL, DANILO D. LIM, FELIPE PESTAO, EVELYN
PESTAO, RENATO M. REYES, JR., SECRETARY GENERAL OF BAGONG
ALYANSANG MAKABAYAN (BAYAN); MOTHER MARY JOHN MANANZAN,
CO-CHAIRPERSON OF PAGBABAGO; DANILO RAMOS, SECRETARYGENERAL OF KILUSANG MAGBUBUKID NG PILIPINAS (KMP); ATTY.
EDRE OLALIA, ACTING SECRETARY GENERAL OF THE NATIONAL UNION
OF PEOPLES LAWYERS (NUPL); FERDINAND R. GAITE, CHAIRPERSON,
CONFEDERATION FOR UNITY, RECOGNITION AND ADVANCEMENT OF
GOVERNMENT

CORONA, C.J.,
CARPIO,
CARPIO MORALES,
VELASCO, JR.,*
NACHURA,
LEONARDO-DE CASTRO,
BRION,

EMPLOYEES (COURAGE); and JAMES TERRY RIDON OF THE LEAGUE OF


FILIPINO STUDENTS (LFS),

PERALTA,
BERSAMIN,

Respondents.
DEL CASTILLO,
ABAD,
FELICIANO BELMONTE, JR.,
Respondent-Intervenor.

VILLARAMA, JR.,
PEREZ,

95

MENDOZA, and
SERENO, JJ.
DECISION

CARPIO MORALES, J.:

The Ombudsman, Ma. Merceditas Gutierrez (petitioner), challenges via petition for
certiorari and prohibition the Resolutions of September 1 and 7, 2010 of the House
of Representatives Committee on Justice (public respondent).

Before the 15th Congress opened its first session on July 26, 2010 (the fourth
Monday of July, in accordance with Section 15, Article VI of the Constitution) or on
July 22, 2010, private respondents Risa Hontiveros-Baraquel, Danilo Lim, and
spouses Felipe and Evelyn Pestao (Baraquel group) filed an impeachment
complaint[1] against petitioner, upon the endorsement of Party-List Representatives
Arlene Bag-ao and Walden Bello.[2]

Promulgated:

February 15, 2011

x-------------------------------------------------------------------------------- x

A day after the opening of the 15th Congress or on July 27, 2010, Atty. Marilyn
Barua-Yap, Secretary General of the House of Representatives, transmitted the
impeachment complaint to House Speaker Feliciano Belmonte, Jr.[3] who, by
Memorandum of August 2, 2010, directed the Committee on Rules to include it in
the Order of Business.[4]

On August 3, 2010, private respondents Renato Reyes, Jr., Mother Mary John
Mananzan, Danilo Ramos, Edre Olalia, Ferdinand Gaite and James Terry Ridon
(Reyes group) filed another impeachment complaint[5] against petitioner with a
resolution of endorsement by Party-List Representatives Neri Javier Colmenares,
Teodoro Casio, Rafael Mariano, Luzviminda Ilagan, Antonio Tinio and Emerenciana
de Jesus.[6] On even date, the House of Representatives provisionally adopted the
Rules of Procedure in Impeachment Proceedings of the 14th Congress. By letter still

96

of even date,[7] the Secretary General transmitted the Reyes groups complaint to
Speaker Belmonte who, by Memorandum of August 9, 2010,[8] also directed the
Committee on Rules to include it in the Order of Business.

On August 10, 2010, House Majority Leader Neptali Gonzales II, as chairperson of
the Committee on Rules,[9] instructed Atty. Artemio Adasa, Jr., Deputy Secretary
General for Operations, through Atty. Cesar Pareja, Executive Director of the
Plenary Affairs Department, to include the two complaints in the Order of Business,
[10] which was complied with by their inclusion in the Order of Business for the
following day, August 11, 2010.

On August 11, 2010 at 4:47 p.m., during its plenary session, the House of
Representatives simultaneously referred both complaints to public respondent.[11]

After hearing, public respondent, by Resolution of September 1, 2010, found both


complaints sufficient in form, which complaints it considered to have been referred
to it at exactly the same time.

Meanwhile, the Rules of Procedure in Impeachment Proceedings of the 15th


Congress was published on September 2, 2010.

On September 6, 2010, petitioner tried to file a motion to reconsider the September


1, 2010 Resolution of public respondent. Public respondent refused to accept the
motion, however, for prematurity; instead, it advised petitioner to await the notice for
her to file an answer to the complaints, drawing petitioner to furnish copies of her
motion to each of the 55 members of public respondent.

After hearing, public respondent, by Resolution of September 7, 2010, found the two
complaints, which both allege culpable violation of the Constitution and betrayal of
public trust,[12] sufficient in substance. The determination of the sufficiency of
substance of the complaints by public respondent, which assumed hypothetically the
truth of their allegations, hinged on the issue of whether valid judgment to impeach

could be rendered thereon. Petitioner was served also on September 7, 2010 a notice
directing her to file an answer to the complaints within 10 days.[13]

Six days following her receipt of the notice to file answer or on September 13, 2010,
petitioner filed with this Court the present petition with application for injunctive
reliefs. The following day or on September 14, 2010, the Court En Banc
RESOLVED to direct the issuance of a status quo ante order[14] and to require
respondents to comment on the petition in 10 days. The Court subsequently, by
Resolution of September 21, 2010, directed the Office of the Solicitor General
(OSG) to file in 10 days its Comment on the petition

The Baraquel group which filed the first complaint, the Reyes group which filed the
second complaint, and public respondent (through the OSG and private counsel)
filed their respective Comments on September 27, 29 and 30, 2010.

Speaker Belmonte filed a Motion for Leave to Intervene dated October 4, 2010
which the Court granted by Resolution of October 5, 2010.

Under an Advisory[15] issued by the Court, oral arguments were conducted on


October 5 and 12, 2010, followed by petitioners filing of a Consolidated Reply of
October 15, 2010 and the filing by the parties of Memoranda within the given 15-day
period.

The petition is harangued by procedural objections which the Court shall first
resolve.

Respondents raise the impropriety of the remedies of certiorari and prohibition. They
argue that public respondent was not exercising any judicial, quasi-judicial or
ministerial function in taking cognizance of the two impeachment complaints as it
was exercising a political act that is discretionary in nature,[16] and that its function
is inquisitorial that is akin to a preliminary investigation.[17]

97

"judicially discoverable standards" for determining the validity of the exercise of


such discretion, through the power of judicial review.
These same arguments were raised in Francisco, Jr. v. House of Representatives.[18]
The argument that impeachment proceedings are beyond the reach of judicial review
was debunked in this wise:
xxxx
The major difference between the judicial power of the Philippine Supreme Court
and that of the U.S. Supreme Court is that while the power of judicial review is only
impliedly granted to the U.S. Supreme Court and is discretionary in nature, that
granted to the Philippine Supreme Court and lower courts, as expressly provided for
in the Constitution, is not just a power but also a duty, and it was given an expanded
definition to include the power to correct any grave abuse of discretion on the part of
any government branch or instrumentality.

There are also glaring distinctions between the U.S. Constitution and the Philippine
Constitution with respect to the power of the House of Representatives over
impeachment proceedings. While the U.S. Constitution bestows sole power of
impeachment to the House of Representatives without limitation, our Constitution,
though vesting in the House of Representatives the exclusive power to initiate
impeachment cases, provides for several limitations to the exercise of such power as
embodied in Section 3(2), (3), (4) and (5), Article XI thereof. These limitations
include the manner of filing, required vote to impeach, and the one year bar on the
impeachment of one and the same official.

Respondents are also of the view that judicial review of impeachments undermines
their finality and may also lead to conflicts between Congress and the judiciary.
Thus, they call upon this Court to exercise judicial statesmanship on the principle
that "whenever possible, the Court should defer to the judgment of the people
expressed legislatively, recognizing full well the perils of judicial willfulness and
pride."

But did not the people also express their will when they instituted the abovementioned safeguards in the Constitution? This shows that the Constitution did not
intend to leave the matter of impeachment to the sole discretion of Congress. Instead,
it provided for certain well-defined limits, or in the language of Baker v. Carr,

There is indeed a plethora of cases in which this Court exercised the power of
judicial review over congressional action. Thus, in Santiago v. Guingona, Jr., this
Court ruled that it is well within the power and jurisdiction of the Court to inquire
whether the Senate or its officials committed a violation of the Constitution or grave
abuse of discretion in the exercise of their functions and prerogatives. In Taada v.
Angara, in seeking to nullify an act of the Philippine Senate on the ground that it
contravened the Constitution, it held that the petition raises a justiciable controversy
and that when an action of the legislative branch is seriously alleged to have
infringed the Constitution, it becomes not only the right but in fact the duty of the
judiciary to settle the dispute. In Bondoc v. Pineda, this Court declared null and void
a resolution of the House of Representatives withdrawing the nomination, and
rescinding the election, of a congressman as a member of the House Electoral
Tribunal for being violative of Section 17, Article VI of the Constitution. In Coseteng
v. Mitra, it held that the resolution of whether the House representation in the
Commission on Appointments was based on proportional representation of the
political parties as provided in Section 18, Article VI of the Constitution is subject to
judicial review. In Daza v. Singson, it held that the act of the House of
Representatives in removing the petitioner from the Commission on Appointments is
subject to judicial review. In Taada v. Cuenco, it held that although under the
Constitution, the legislative power is vested exclusively in Congress, this does not
detract from the power of the courts to pass upon the constitutionality of acts of
Congress. In Angara v. Electoral Commission, it ruled that confirmation by the
National Assembly of the election of any member, irrespective of whether his
election is contested, is not essential before such member-elect may discharge the
duties and enjoy the privileges of a member of the National Assembly.

Finally, there exists no constitutional basis for the contention that the exercise of
judicial review over impeachment proceedings would upset the system of checks and
balances. Verily, the Constitution is to be interpreted as a whole and "one section is
not to be allowed to defeat another." Both are integral components of the calibrated
system of independence and interdependence that insures that no branch of

98

government act beyond the powers assigned to it by the Constitution.[19] (citations


omitted; italics in the original; underscoring supplied)

Rules of Procedure in Impeachment Proceedings of the House (Impeachment Rules)


present constitutional vagaries which call for immediate interpretation.

Francisco characterizes the power of judicial review as a duty which, as the


expanded certiorari jurisdiction[20] of this Court reflects, includes the power to
determine whether or not there has been a grave abuse of discretion amounting to
lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government.[21]

The unusual act of simultaneously referring to public respondent two impeachment


complaints presents a novel situation to invoke judicial power. Petitioner cannot thus
be considered to have acted prematurely when she took the cue from the
constitutional limitation that only one impeachment proceeding should be initiated
against an impeachable officer within a period of one year.

In the present case, petitioner invokes the Courts expanded certiorari jurisdiction,
using the special civil actions of certiorari and prohibition as procedural vehicles.
The Court finds it well-within its power to determine whether public respondent
committed a violation of the Constitution or gravely abused its discretion in the
exercise of its functions and prerogatives that could translate as lack or excess of
jurisdiction, which would require corrective measures from the Court.

And so the Court proceeds to resolve the substantive issue whether public
respondent committed grave abuse of discretion amounting to lack or excess of
jurisdiction in issuing its two assailed Resolutions. Petitioner basically anchors her
claim on alleged violation of the due process clause (Art. III, Sec. 1) and of the oneyear bar provision (Art. XI, Sec 3, par. 5) of the Constitution.

Indubitably, the Court is not asserting its ascendancy over the Legislature in this
instance, but simply upholding the supremacy of the Constitution as the repository of
the sovereign will.[22]
Due process of law
Respondents do not seriously contest all the essential requisites for the exercise of
judicial review, as they only assert that the petition is premature and not yet ripe for
adjudication since petitioner has at her disposal a plain, speedy and adequate remedy
in the course of the proceedings before public respondent. Public respondent argues
that when petitioner filed the present petition[23] on September 13, 2010, it had not
gone beyond the determination of the sufficiency of form and substance of the two
complaints.

An aspect of the case-or-controversy requirement is the requisite


of ripeness.[24] The question of ripeness is especially relevant in light of the direct,
adverse effect on an individual by the challenged conduct.[25] In the present petition,
there is no doubt that questions on, inter alia, the validity of the simultaneous referral
of the two complaints and on the need to publish as a mode of promulgating the

Petitioner alleges that public respondents chairperson, Representative Niel Tupas, Jr.
(Rep. Tupas), is the subject of an investigation she is conducting, while his father,
former Iloilo Governor Niel Tupas, Sr., had been charged by her with violation of the
Anti-Graft and Corrupt Practices Act before the Sandiganbayan. To petitioner, the
actions taken by her office against Rep. Tupas and his father influenced the
proceedings taken by public respondent in such a way that bias and vindictiveness
played a big part in arriving at the finding of sufficiency of form and substance of the
complaints against her.

The Court finds petitioners allegations of bias and vindictiveness bereft of merit,
there being hardly any indication thereof. Mere suspicion of partiality does not
suffice.[26]

99

JUSTICE MORALES:
The act of the head of a collegial body cannot be considered as that of the entire
body itself. So GMCR, Inc. v. Bell Telecommunications Phils.[27] teaches:

Is he a one-man committee?
JUSTICE CUEVAS:

First. We hereby declare that the NTC is a collegial body requiring a majority vote
out of the three members of the commission in order to validly decide a case or any
incident therein. Corollarily, the vote alone of the chairman of the commission, as in
this case, the vote of Commissioner Kintanar, absent the required concurring vote
coming from the rest of the membership of the commission to at least arrive at a
majority decision, is not sufficient to legally render an NTC order, resolution or
decision.

He is not a one-man committee, Your Honor, but he decides.

Simply put, Commissioner Kintanar is not the National Telecommunications


Commission. He alone does not speak and in behalf of the NTC. The NTC acts
through a three-man body x x x. [28]

JUSTICE CUEVAS:

JUSTICE MORALES:
Do we presume good faith or we presume bad faith?

We presume that he is acting in good faith, Your Honor, but then (interrupted)

JUSTICE MORALES:
In the present case, Rep. Tupas, public respondent informs, did not, in fact, vote and
merely presided over the proceedings when it decided on the sufficiency of form and
substance of the complaints.[29]

So, that he was found liable for violation of the Anti Graft and Corrupt Practices Act,
does that mean that your client will be deprived of due process of law?

JUSTICE CUEVAS:
Even petitioners counsel conceded during the oral arguments that there are no
grounds to compel the inhibition of Rep. Tupas.
JUSTICE CUEVAS:
Well, the Committee is headed by a gentleman who happened to be a respondent in
the charges that the Ombudsman filed. In addition to that[,] his father was likewise a
respondent in another case. How can he be expected to act with impartiality, in
fairness and in accordance with law under that matter, he is only human we grant
him that benefit.

No, what we are stating, Your Honor, is that expectation of a client goes with the
Ombudsman, which goes with the element of due process is the lack of impartiality
that may be expected of him.

JUSTICE MORALES:
But as you admitted the Committee is not a one-man committee?

100

bias, she pointing out that it only took public respondent five minutes to arrive
thereat.
JUSTICE CUEVAS:
That is correct, Your Honor.
An abbreviated pace in the conduct of proceedings is not per se an indication of bias,
however. So Santos-Concio v. Department of Justice[31] holds:
JUSTICE MORALES:
So, why do you say then that there is a lack of impartiality?

JUSTICE CUEVAS:
Because if anything before anything goes (sic) he is the presiding officer of the
committee as in this case there were objections relative to the existence of the
implementing rules not heard, there was objection made by Congressman Golez to
the effect that this may give rise to a constitutional crisis.

JUSTICE MORALES:

Speed in the conduct of proceedings by a judicial or quasi-judicial officer cannot per


se be instantly attributed to an injudicious performance of functions. For ones prompt
dispatch may be anothers undue haste. The orderly administration of justice remains
as the paramount and constant consideration, with particular regard of the
circumstances peculiar to each case.

The presumption of regularity includes the public officers official actuations in all
phases of work. Consistent with such presumption, it was incumbent upon petitioners
to present contradictory evidence other than a mere tallying of days or numerical
calculation. This, petitioners failed to discharge. The swift completion of the
Investigating Panels initial task cannot be relegated as shoddy or shady without
discounting the presumably regular performance of not just one but five state
prosecutors.[32] (italics in the original; emphasis and underscoring supplied)

That called for a voluntary inhibition. Is there any law or rule you can cite which
makes it mandatory for the chair of the committee to inhibit given that he had
previously been found liable for violation of a law[?]

JUSTICE CUEVAS:
There is nothing, Your Honor. In our jurisprudence which deals with the situation
whereby with that background as the material or pertinent antecedent that there could
be no violation of the right of the petitioner to due process. What is the effect of
notice, hearing if the judgment cannot come from an impartial adjudicator.[30]
(emphasis and underscoring supplied)

Petitioner goes on to contend that her participation in the determination of


sufficiency of form and substance was indispensable. As mandated by the
Impeachment Rules, however, and as, in fact, conceded by petitioners counsel, the
participation of the impeachable officer starts with the filing of an answer.

JUSTICE MORALES:
Petitioner contends that the indecent and precipitate haste of public respondent in
finding the two complaints sufficient in form and substance is a clear indication of

Is it not that the Committee should first determine that there is sufficiency in form
and substance before she is asked to file her answer (interrupted)

101

JUSTICE CUEVAS:
That is correct, Your Honor.

JUSTICE MORALES:
During which she can raise any defenses she can assail the regularity of the
proceedings and related irregularities?

JUSTICE CUEVAS:
Yes. We are in total conformity and in full accord with that statement, Your Honor,
because it is only after a determination that the complaint is sufficient in form and
substance that a complaint may be filed, Your Honor, without that but it may be
asked, how is not your action premature, Your Honor, our answer is- no, because of
the other violations involved and that is (interrupted).[33] (emphasis and
underscoring supplied)

Rule III(A) of the Impeachment Rules of the 15th Congress reflects the impeachment
procedure at the Committee-level, particularly Section 5[34] which denotes that
petitioners initial participation in the impeachment proceedings the opportunity to
file an Answer starts after the Committee on Justice finds the complaint sufficient in
form and substance. That the Committee refused to accept petitioners motion for
reconsideration from its finding of sufficiency of form of the impeachment
complaints is apposite, conformably with the Impeachment Rules.

The determination of sufficiency of form and substance of an impeachment


complaint is an exponent of the express constitutional grant of rule-making powers
of the House of Representatives which committed such determinative function to
public respondent. In the discharge of that power and in the exercise of its discretion,
the House has formulated determinable standards as to the form and substance of an
impeachment complaint. Prudential considerations behoove the Court to respect the
compliance by the House of its duty to effectively carry out the constitutional
purpose, absent any contravention of the minimum constitutional guidelines.

Contrary to petitioners position that the Impeachment Rules do not provide for
comprehensible standards in determining the sufficiency of form and substance, the
Impeachment Rules are clear in echoing the constitutional requirements and
providing that there must be a verified complaint or resolution,[36] and that the
substance requirement is met if there is a recital of facts constituting the offense
charged and determinative of the jurisdiction of the committee.[37]

Notatu dignum is the fact that it is only in the Impeachment Rules where a
determination of sufficiency of form and substance of an impeachment complaint is
made necessary. This requirement is not explicitly found in the organic law, as
Section 3(2), Article XI of the Constitution basically merely requires a hearing.[38]
In the discharge of its constitutional duty, the House deemed that a finding of
sufficiency of form and substance in an impeachment complaint is vital to effectively
carry out the impeachment process, hence, such additional requirement in the
Impeachment Rules.

Petitioner urges the Court to look into the narration of facts constitutive of the
offenses vis--vis her submissions disclaiming the allegations in the complaints.
Petitioner further claims that public respondent failed to ascertain the sufficiency of
form and substance of the complaints on the basis of the standards set by the
Constitution and its own Impeachment Rules.[35]
This the Court cannot do.
The claim fails.

102

Francisco instructs that this issue would require the Court to make a determination of
what constitutes an impeachable offense. Such a determination is a purely political
question which the Constitution has left to the sound discretion of the legislature.
Such an intent is clear from the deliberations of the Constitutional Commission. x x x
x Clearly, the issue calls upon this court to decide a non-justiciable political question
which is beyond the scope of its judicial power[.][39] Worse, petitioner urges the
Court to make a preliminary assessment of certain grounds raised, upon a
hypothetical admission of the facts alleged in the complaints, which involve matters
of defense.

Blacks Law Dictionary broadly defines promulgate as

To publish; to announce officially; to make public as important or obligatory. The


formal act of announcing a statute or rule of court. An administrative order that is
given to cause an agency law or regulation to become known or obligatory.[44]
(emphasis supplied)

In another vein, petitioner, pursuing her claim of denial of due process, questions the
lack of or, more accurately, delay in the publication of the Impeachment Rules.
To recall, days after the 15th Congress opened on July 26, 2010 or on August 3,
2010, public respondent provisionally adopted the Impeachment Rules of the 14th
Congress and thereafter published on September 2, 2010 its Impeachment Rules,
admittedly substantially identical with that of the 14th Congress, in two newspapers
of general circulation.[40]

Citing Taada v. Tuvera,[41] petitioner contends that she was deprived of due process
since the Impeachment Rules was published only on September 2, 2010 a day after
public respondent ruled on the sufficiency of form of the complaints. She likewise
tacks her contention on Section 3(8), Article XI of the Constitution which directs that
Congress shall promulgate its rules on impeachment to effectively carry out the
purpose of this section.

Public respondent counters that promulgation in this case refers to the publication of
rules in any medium of information, not necessarily in the Official Gazette or
newspaper of general circulation.[42]

Differentiating Neri v. Senate Committee on Accountability of Public Officers and


Investigations[43] which held that the Constitution categorically requires publication
of the rules of procedure in legislative inquiries, public respondent explains that the
Impeachment Rules is intended to merely enable Congress to effectively carry out
the purpose of Section 3(8), Art. XI of Constitution.

While promulgation would seem synonymous to publication, there is a statutory


difference in their usage.
The Constitution notably uses the word promulgate 12 times.[45] A number of those
instances involves the promulgation of various rules, reports and issuances
emanating from Congress, this Court, the Office of the Ombudsman as well as other
constitutional offices.

To appreciate the statutory difference in the usage of the terms promulgate and
publish, the case of the Judiciary is in point. In promulgating rules concerning the
protection and enforcement of constitutional rights, pleading, practice and procedure
in all courts, the Court has invariably required the publication of these rules for their
effectivity. As far as promulgation of judgments is concerned, however,
promulgation means the delivery of the decision to the clerk of court for filing and
publication.[46]

Section 4, Article VII of the Constitution contains a similar provision directing


Congress to promulgate its rules for the canvassing of the certificates in the
presidential and vice presidential elections. Notably, when Congress approved its
canvassing rules for the May 14, 2010 national elections on May 25, 2010,[47] it did
not require the publication thereof for its effectivity. Rather, Congress made the
canvassing rules effective upon its adoption.

103

In the case of administrative agencies, promulgation and publication likewise take on


different meanings as they are part of a multi-stage procedure in quasi-legislation. As
detailed in one case,[48] the publication of implementing rules occurs after their
promulgation or adoption.

real and effective opportunity to fashion and promulgate as well as to implement


them, before the courts may intervene.[50] (italics in the original; emphasis and
underscoring supplied; citations omitted)

Promulgation must thus be used in the context in which it is generally understoodthat


is, to make known. Generalia verba sunt generaliter inteligencia. What is generally
spoken shall be generally understood. Between the restricted sense and the general
meaning of a word, the general must prevail unless it was clearly intended that the
restricted sense was to be used.[49]

Had the Constitution intended to have the Impeachment Rules published, it could
have stated so as categorically as it did in the case of the rules of procedure in
legislative inquiries, per Neri. Other than promulgate, there is no other single formal
term in the English language to appropriately refer to an issuance without need of it
being published.

Since the Constitutional Commission did not restrict promulgation to publication, the
former should be understood to have been used in its general sense. It is within the
discretion of Congress to determine on how to promulgate its Impeachment Rules, in
much the same way that the Judiciary is permitted to determine that to promulgate a
decision means to deliver the decision to the clerk of court for filing and publication.

IN FINE, petitioner cannot take refuge in Neri since inquiries in aid of legislation
under Section 21, Article VI of the Constitution is the sole instance in the
Constitution where there is a categorical directive to duly publish a set of rules of
procedure. Significantly notable in Neri is that with respect to the issue of
publication, the Court anchored its ruling on the 1987 Constitutions directive,
without any reliance on or reference to the 1986 case of Taada v. Tuvera.[51] Taada
naturally could neither have interpreted a forthcoming 1987 Constitution nor had
kept a tight rein on the Constitutions intentions as expressed through the allowance
of either a categorical term or a general sense of making known the issuances.

It is not for this Court to tell a co-equal branch of government how to promulgate
when the Constitution itself has not prescribed a specific method of promulgation.
The Court is in no position to dictate a mode of promulgation beyond the dictates of
the Constitution.

From the deliberations of the Constitutional Commission, then Commissioner, now


retired Associate Justice Florenz Regalado intended Section 3(8), Article XI to be the
vehicle for the House to fill the gaps in the impeachment process.
Publication in the Official Gazette or a newspaper of general circulation is but one
avenue for Congress to make known its rules. Jurisprudence emphatically teaches
that

x x x in the absence of constitutional or statutory guidelines or specific rules, this


Court is devoid of any basis upon which to determine the legality of the acts of the
Senate relative thereto. On grounds of respect for the basic concept of separation of
powers, courts may not intervene in the internal affairs of the legislature; it is not
within the province of courts to direct Congress how to do its work. In the words of
Justice Florentino P. Feliciano, this Court is of the opinion that where no specific,
operable norms and standards are shown to exist, then the legislature must be given a

MR. REGALADO. Mr. Presiding Officer, I have decided to put in an additional


section because, for instance, under Section 3 (2), there is mention of indorsing a
verified complaint for impeachment by any citizen alleging ultimate facts
constituting a ground or grounds for impeachment. In other words, it is just like a
provision in the rules of court. Instead, I propose that this procedural requirement,
like indorsement of a complaint by a citizen to avoid harassment or crank
complaints, could very well be taken up in a new section 4 which shall read as
follows: THE CONGRESS SHALL PROMULGATE ITS RULES ON
IMPEACHMENT TO EFFECTIVELY CARRY OUT THE PURPOSES THEREOF.

104

I think all these other procedural requirements could be taken care of by the Rules of
Congress.[52] (emphasis and underscoring supplied)

The discussion clearly rejects the notion that the impeachment provisions are not
self-executing. Section 3(8) does not, in any circumstance, operate to suspend the
entire impeachment mechanism which the Constitutional Commission took pains in
designing even its details.

As against constitutions of the past, modern constitutions have been generally


drafted upon a different principle and have often become in effect extensive codes of
laws intended to operate directly upon the people in a manner similar to that of
statutory enactments, and the function of constitutional conventions has evolved into
one more like that of a legislative body. Hence, unless it is expressly provided that a
legislative act is necessary to enforce a constitutional mandate, the presumption now
is that all provisions of the constitution are self-executing. If the constitutional
provisions are treated as requiring legislation instead of self-executing, the
legislature would have the power to ignore and practically nullify the mandate of the
fundamental law. This can be cataclysmic. That is why the prevailing view is, as it
has always been, that

. . . in case of doubt, the Constitution should be considered self-executing rather than


non-self-executing . . . . Unless the contrary is clearly intended, the provisions of the
Constitution should be considered self-executing, as a contrary rule would give the
legislature discretion to determine when, or whether, they shall be effective. These
provisions would be subordinated to the will of the lawmaking body, which could
make them entirely meaningless by simply refusing to pass the needed implementing
statute.[53] (emphasis and underscoring supplied)

to the effectivity of the Impeachment Rules. In effect, the House would already
violate the Constitution for its inaction on the impeachment complaints pending the
completion of the publication requirement.

Given that the Constitution itself states that any promulgation of the rules on
impeachment is aimed at effectively carry[ing] out the purpose of impeachment
proceedings, the Court finds no grave abuse of discretion when the House deemed it
proper to provisionally adopt the Rules on Impeachment of the 14th Congress, to
meet the exigency in such situation of early filing and in keeping with the effective
implementation of the purpose of the impeachment provisions. In other words, the
provisional adoption of the previous Congress Impeachment Rules is within the
power of the House to promulgate its rules on impeachment to effectively carry out
the avowed purpose.

Moreover, the rules on impeachment, as contemplated by the framers of the


Constitution, merely aid or supplement the procedural aspects of impeachment.
Being procedural in nature, they may be given retroactive application to pending
actions. It is axiomatic that the retroactive application of procedural laws does not
violate any right of a person who may feel that he is adversely affected, nor is it
constitutionally objectionable. The reason for this is that, as a general rule, no vested
right may attach to, nor arise from, procedural laws.[54] In the present case,
petitioner fails to allege any impairment of vested rights.

It bears stressing that, unlike the process of inquiry in aid of legislation where the
rights of witnesses are involved, impeachment is primarily for the protection of the
people as a body politic, and not for the punishment of the offender.[55]
Even Neri concedes that the unpublished rules of legislative inquiries were not
considered null and void in its entirety. Rather,

Even assuming arguendo that publication is required, lack of it does not nullify the
proceedings taken prior to the effectivity of the Impeachment Rules which faithfully
comply with the relevant self-executing provisions of the Constitution. Otherwise, in
cases where impeachment complaints are filed at the start of each Congress, the
mandated periods under Section 3, Article XI of the Constitution would already run
or even lapse while awaiting the expiration of the 15-day period of publication prior

x x x [o]nly those that result in violation of the rights of witnesses should be


considered null and void, considering that the rationale for the publication is to
protect the rights of witnesses as expressed in Section 21, Article VI of the
Constitution. Sans such violation, orders and proceedings are considered valid and
effective.[56] (emphasis and underscoring supplied)

105

maintains that under either the prevailing doctrine or the parties interpretation, its
impeachment complaint could withstand constitutional scrutiny.

Petitioner in fact does not deny that she was fully apprised of the proper procedure.
She even availed of and invoked certain provisions[57] of the Impeachment Rules
when she, on September 7, 2010, filed the motion for reconsideration and later filed
the present petition. The Court thus finds no violation of the due process clause.

The one-year bar rule

Article XI, Section 3, paragraph (5) of the Constitution reads: No impeachment


proceedings shall be initiated against the same official more than once within a
period of one year.

Petitioner reckons the start of the one-year bar from the filing of the first
impeachment complaint against her on July 22, 2010 or four days before the opening
on July 26, 2010 of the 15th Congress. She posits that within one year from July 22,
2010, no second impeachment complaint may be accepted and referred to public
respondent.

On the other hand, public respondent, respondent Reyes group and respondentintervenor submit that the initiation starts with the filing of the impeachment
complaint and ends with the referral to the Committee, following Francisco, but
venture to alternatively proffer that the initiation ends somewhere between the
conclusion of the Committee Report and the transmittal of the Articles of
Impeachment to the Senate. Respondent Baraquel group, meanwhile, essentially

Contrary to petitioners asseveration, Francisco[58] states that the term initiate means
to file the complaint and take initial action on it.[59] The initiation starts with the
filing of the complaint which must be accompanied with an action to set the
complaint moving. It refers to the filing of the impeachment complaint coupled with
Congress taking initial action of said complaint. The initial action taken by the House
on the complaint is the referral of the complaint to the Committee on Justice.

Petitioner misreads the remark of Commissioner Joaquin Bernas, S.J. that no second
verified impeachment may be accepted and referred to the Committee on Justice for
action[60] which contemplates a situation where a first impeachment complaint had
already been referred. Bernas and Regalado, who both acted as amici curiae in
Francisco, affirmed that the act of initiating includes the act of taking initial action
on the complaint.

From the records of the Constitutional Commission, to the amicus curiae briefs of
two former Constitutional Commissioners, it is without a doubt that the term "to
initiate" refers to the filing of the impeachment complaint coupled with Congress'
taking initial action of said complaint.

Having concluded that the initiation takes place by the act of filing and referral or
endorsement of the impeachment complaint to the House Committee on Justice or,
by the filing by at least one-third[61] of the members of the House of
Representatives with the Secretary General of the House, the meaning of Section 3
(5) of Article XI becomes clear. Once an impeachment complaint has been initiated,
another impeachment complaint may not be filed against the same official within a
one year period.[62] (emphasis and underscoring supplied)

The Court, in Francisco, thus found that the assailed provisions of the 12th Congress
Rules of Procedure in Impeachment Proceedings Sections 16[63] and 17[64] of

106

Rule V thereof clearly contravene Section 3(5) of Article XI since they g[a]ve the
term initiate a meaning different from filing and referral.[65]

xxxx
MR. DAVIDE. However, if we allow one-fifth of the membership of the legislature
to overturn a report of the committee, we have here Section 3 (4) which reads:

Petitioner highlights certain portions of Francisco which delve on the relevant


records of the Constitutional Commission, particularly Commissioner Maambongs
statements[66] that the initiation starts with the filing of the complaint.

Petitioner fails to consider the verb starts as the operative word. Commissioner
Maambong was all too keen to stress that the filing of the complaint indeed starts the
initiation and that the Houses action on the committee report/resolution is not part of
that initiation phase.

Commissioner Maambong saw the need to be very technical about this,[67] for
certain exchanges in the Constitutional Commission deliberations loosely used the
term, as shown in the following exchanges.

MR. DAVIDE. That is for conviction, but not for initiation. Initiation of
impeachment proceedings still requires a vote of one-fifth of the membership of the
House under the 1935 Constitution.

MR. MONSOD. A two-thirds vote of the membership of the House is required to


initiate proceedings.

MR. DAVIDE. No. for initiation of impeachment proceedings, only one-fifth vote of
the membership of the House is required; for conviction, a two-thirds vote of the
membership is required.

No impeachment proceedings shall be initiated against the same official more than
once within a period of one year.

So, necessarily, under this particular subsection, we will, in effect, disallow one-fifth
of the members of the National Assembly to revive an impeachment move by an
individual or an ordinary Member.

MR. ROMULO. Yes. May I say that Section 3 (4) is there to look towards the
possibility of a very liberal impeachment proceeding. Second, we were ourselves
struggling with that problem where we are faced with just a verified complaint rather
than the signatures of one-fifth, or whatever it is we decide, of the Members of the
House. So whether to put a period for the Committee to report, whether we should
not allow the Committee to overrule a mere verified complaint, are some of the
questions we would like to be discussed.

MR. DAVIDE. We can probably overrule a rejection by the Committee by providing


that it can be overturned by, say, one-half or a majority, or one-fifth of the members
of the legislature, and that such overturning will not amount to a refiling which is
prohibited under Section 3 (4).
Another point, Madam President. x x x[68] (emphasis and underscoring supplied)

An apparent effort to clarify the term initiate was made by Commissioner Teodulo
Natividad:
MR. NATIVIDAD. How many votes are needed to initiate?

107

MR. NATIVIDAD. To initiate is different from to impeach; to impeach is different


from to convict. To impeach means to file the case before the Senate.

resolution, and the Articles of Impeachment to the body, and it was the body who
approved the resolution. It is not the body which initiates it. It only approves or
disapproves the resolution. So, on that score, probably the Committee on Style could
help in rearranging the words because we have to be very technical about this. I have
been bringing with me The Rules of the House of Representatives of the U.S.
Congress. The Senate Rules are with me. The proceedings on the case of Richard
Nixon are with me. I have submitted my proposal, but the Committee has already
decided. Nevertheless, I just want to indicate this on record.

MR. REGALADO. When we speak of initiative, we refer here to the Articles of


Impeachment.

Thank you, Mr. Presiding Officer.[70] (italics in the original; emphasis and
underscoring supplied)

MR. NATIVIDAD. So, that is the impeachment itself, because when we impeach, we
are charging him with the Articles of Impeachment. That is my understanding.[69]
(emphasis and underscoring supplied)

[II]

Capping these above-quoted discussions was the explanation of Commissioner


Maambong delivered on at least two occasions:

MR. MAAMBONG. I would just like to move for a reconsideration of the approval
of Section 3 (3). My reconsideration will not at all affect the substance, but it is only
with keeping with the exact formulation of the Rules of the House of Representatives
of the United States regarding impeachment.

MR. BENGZON. One-third.

[I]
MR. MAAMBONG. Mr. Presiding Officer, I am not moving for a reconsideration of
the approval of the amendment submitted by Commissioner Regalado, but I will just
make of record my thinking that we do not really initiate the filing of the Articles of
Impeachment on the floor. The procedure, as I have pointed out earlier, was that the
initiation starts with the filing of the complaint. And what is actually done on the
floor is that the committee resolution containing the Articles of Impeachment is the
one approved by the body.

As the phraseology now runs, which may be corrected by the Committee on Style, it
appears that the initiation starts on the floor. If we only have time, I could cite
examples in the case of the impeachment proceedings of President Richard Nixon
wherein the Committee on the Judiciary submitted the recommendation, the

I am proposing, Madam President, without doing damage to any of its provision, that
on page 2, Section 3 (3), from lines 17 to 18, we delete the words which read: to
initiate impeachment proceedings and the comma (,) and insert on line 19 after the
word resolution the phrase WITH THE ARTICLES, and then capitalize the letter i in
impeachment and replace the word by with OF, so that the whole section will now
read: A vote of at least one-third of all the Members of the House shall be necessary
either to affirm a resolution WITH THE ARTICLES of impeachment OF the
committee or to override its contrary resolution. The vote of each Member shall be
recorded.

I already mentioned earlier yesterday that the initiation, as far as the House of
Representatives of the United States is concerned, really starts from the filing of the
verified complaint and every resolution to impeach always carries with it the Articles
of Impeachment. As a matter of fact, the words Articles of Impeachment are
mentioned on line 25 in the case of the direct filing of a verified complaint of one-

108

third of all the Members of the House. I will mention again, Madam President, that
my amendment will not vary the substance in any way. It is only in keeping with the
uniform procedure of the House of Representatives of the United States Congress.
The Court cannot countenance any attempt at obscurantism.
Thank you, Madam President.[71] (emphasis and underscoring supplied)

To the next logical question of what ends or completes the initiation, Commissioners
Bernas and Regalado lucidly explained that the filing of the complaint must be
accompanied by the referral to the Committee on Justice, which is the action that sets
the complaint moving. Francisco cannot be any clearer in pointing out the material
dates.

Having concluded that the initiation takes place by the act of filing of the
impeachment complaint and referral to the House Committee on Justice, the initial
action taken thereon, the meaning of Section 3 (5) of Article XI becomes clear. Once
an impeachment complaint has been initiated in the foregoing manner, another may
not be filed against the same official within a one year period following Article XI,
Section 3(5) of the Constitution.

In fine, considering that the first impeachment complaint was filed by former
President Estrada against Chief Justice Hilario G. Davide, Jr., along with seven
associate justices of this Court, on June 2, 2003 and referred to the House Committee
on Justice on August 5, 2003, the second impeachment complaint filed by
Representatives Gilberto C. Teodoro, Jr. and Felix William Fuentebella against the
Chief Justice on October 23, 2003 violates the constitutional prohibition against the
initiation of impeachment proceedings against the same impeachable officer within a
one-year period.[72] (emphasis, italics and underscoring supplied)

What the cited discussion was rejecting was the view that the Houses action on the
committee report initiates the impeachment proceedings. It did not state that to
determine the initiating step, absolutely nothing prior to it must be done. Following
petitioners line of reasoning, the verification of the complaint or the endorsement by
a member of the House steps done prior to the filing would already initiate the
impeachment proceedings.
Contrary to petitioners emphasis on impeachment complaint, what the Constitution
mentions is impeachment proceedings. Her reliance on the singular tense of the word
complaint[74] to denote the limit prescribed by the Constitution goes against the
basic rule of statutory construction that a word covers its enlarged and plural sense.
[75]

The Court, of course, does not downplay the importance of an impeachment


complaint, for it is the matchstick that kindles the candle of impeachment
proceedings. The filing of an impeachment complaint is like the lighting of a
matchstick. Lighting the matchstick alone, however, cannot light up the candle,
unless the lighted matchstick reaches or torches the candle wick. Referring the
complaint to the proper committee ignites the impeachment proceeding. With a
simultaneous referral of multiple complaints filed, more than one lighted matchsticks
light the candle at the same time. What is important is that there should only be ONE
CANDLE that is kindled in a year, such that once the candle starts burning,
subsequent matchsticks can no longer rekindle the candle.

A restrictive interpretation renders the impeachment mechanism both illusive and


illusory.

These clear pronouncements notwithstanding, petitioner posits that the date of


referral was considered irrelevant in Francisco. She submits that referral could not be
the reckoning point of initiation because something prior to that had already been
done,[73] apparently citing Bernas discussion.

For one, it puts premium on senseless haste. Petitioners stance suggests that whoever
files the first impeachment complaint exclusively gets the attention of Congress
which sets in motion an exceptional once-a-year mechanism wherein government
resources are devoted. A prospective complainant, regardless of ill motives or best

109

intentions, can wittingly or unwittingly desecrate the entire process by the


expediency of submitting a haphazard complaint out of sheer hope to be the first in
line. It also puts to naught the effort of other prospective complainants who, after
diligently gathering evidence first to buttress the case, would be barred days or even
hours later from filing an impeachment complaint.

Placing an exceedingly narrow gateway to the avenue of impeachment proceedings


turns its laudable purpose into a laughable matter. One needs only to be an early bird
even without seriously intending to catch the worm, when the process is precisely
intended to effectively weed out worms in high offices which could otherwise be
ably caught by other prompt birds within the ultra-limited season.

Moreover, the first-to-file scheme places undue strain on the part of the actual
complainants, injured party or principal witnesses who, by mere happenstance of an
almost always unforeseeable filing of a first impeachment complaint, would be
brushed aside and restricted from directly participating in the impeachment process.

Further, prospective complainants, along with their counsel and members of the
House of Representatives who sign, endorse and file subsequent impeachment
complaints against the same impeachable officer run the risk of violating the
Constitution since they would have already initiated a second impeachment
proceeding within the same year. Virtually anybody can initiate a second or third
impeachment proceeding by the mere filing of endorsed impeachment complaints.
Without any public notice that could charge them with knowledge, even members of
the House of Representatives could not readily ascertain whether no other
impeachment complaint has been filed at the time of committing their endorsement.

The question as to who should administer or pronounce that an impeachment


proceeding has been initiated rests also on the body that administers the proceedings
prior to the impeachment trial. As gathered from Commissioner Bernas
disquisition[76] in Francisco, a proceeding which takes place not in the Senate but in
the House[77] precedes the bringing of an impeachment case to the Senate. In fact,
petitioner concedes that the initiation of impeachment proceedings is within the sole
and absolute control of the House of Representatives.[78] Conscious of the legal
import of each step, the House, in taking charge of its own proceedings, must
deliberately decide to initiate an impeachment proceeding, subject to the time frame

and other limitations imposed by the Constitution. This chamber of Congress alone,
not its officers or members or any private individual, should own up to its processes.

The Constitution did not place the power of the final say on the lips of the House
Secretary General who would otherwise be calling the shots in forwarding or
freezing any impeachment complaint. Referral of the complaint to the proper
committee is not done by the House Speaker alone either, which explains why there
is a need to include it in the Order of Business of the House. It is the House of
Representatives, in public plenary session, which has the power to set its own
chamber into special operation by referring the complaint or to otherwise guard
against the initiation of a second impeachment proceeding by rejecting a patently
unconstitutional complaint.

Under the Rules of the House, a motion to refer is not among those motions that shall
be decided without debate, but any debate thereon is only made subject to the fiveminute rule.[79] Moreover, it is common parliamentary practice that a motion to
refer a matter or question to a committee may be debated upon, not as to the merits
thereof, but only as to the propriety of the referral.[80] With respect to complaints for
impeachment, the House has the discretion not to refer a subsequent impeachment
complaint to the Committee on Justice where official records and further debate
show that an impeachment complaint filed against the same impeachable officer has
already been referred to the said committee and the one year period has not yet
expired, lest it becomes instrumental in perpetrating a constitutionally prohibited
second impeachment proceeding. Far from being mechanical, before the referral
stage, a period of deliberation is afforded the House, as the Constitution, in fact,
grants a maximum of three session days within which to make the proper referral.

As mentioned, one limitation imposed on the House in initiating an impeachment


proceeding deals with deadlines. The Constitution states that [a] verified complaint
for impeachment may be filed by any Member of the House of Representatives or by
any citizen upon a resolution or endorsement by any Member thereof, which shall be
included in the Order of Business within ten session days, and referred to the proper
Committee within three session days thereafter.

110

In the present case, petitioner failed to establish grave abuse of discretion on the
allegedly belated referral of the first impeachment complaint filed by the Baraquel
group. For while the said complaint was filed on July 22, 2010, there was yet then no
session in Congress. It was only four days later or on July 26, 2010 that the 15th
Congress opened from which date the 10-day session period started to run. When, by
Memorandum of August 2, 2010, Speaker Belmonte directed the Committee on
Rules to include the complaint in its Order of Business, it was well within the said
10-day session period.[81]

There is no evident point in rushing at closing the door the moment an impeachment
complaint is filed. Depriving the people (recall that impeachment is primarily for the
protection of the people as a body politic) of reasonable access to the limited
political vent simply prolongs the agony and frustrates the collective rage of an entire
citizenry whose trust has been betrayed by an impeachable officer. It shortchanges
the promise of reasonable opportunity to remove an impeachable officer through the
mechanism enshrined in the Constitution.
But neither does the Court find merit in respondents alternative contention that the
initiation of the impeachment proceedings, which sets into motion the one-year bar,
should include or await, at the earliest, the Committee on Justice report. To public
respondent, the reckoning point of initiation should refer to the disposition of the
complaint by the vote of at least one-third (1/3) of all the members of the House.[82]
To the Reyes group, initiation means the act of transmitting the Articles of
Impeachment to the Senate.[83] To respondent-intervenor, it should last until the
Committee on Justices recommendation to the House plenary.[84]

The Court, in Francisco, rejected a parallel thesis in which a related proposition was
inputed in the therein assailed provisions of the Impeachment Rules of the 12th
Congress. The present case involving an impeachment proceeding against the
Ombudsman offers no cogent reason for the Court to deviate from what was settled
in Francisco that dealt with the impeachment proceeding against the then Chief
Justice. To change the reckoning point of initiation on no other basis but to
accommodate the socio-political considerations of respondents does not sit well in a
court of law.

x x x We ought to be guided by the doctrine of stare decisis et non quieta movere.


This doctrine, which is really "adherence to precedents," mandates that once a case
has been decided one way, then another case involving exactly the same point at
issue should be decided in the same manner. This doctrine is one of policy grounded
on the necessity for securing certainty and stability of judicial decisions. As the
renowned jurist Benjamin Cardozo stated in his treatise The Nature of the Judicial
Process:

It will not do to decide the same question one way between one set of litigants and
the opposite way between another. "If a group of cases involves the same point, the
parties expect the same decision. It would be a gross injustice to decide alternate
cases on opposite principles. If a case was decided against me yesterday when I was
a defendant, I shall look for the same judgment today if I am plaintiff. To decide
differently would raise a feeling of resentment and wrong in my breast; it would be
an infringement, material and moral, of my rights." Adherence to precedent must
then be the rule rather than the exception if litigants are to have faith in the evenhanded administration of justice in the courts.[85]

As pointed out in Francisco, the impeachment proceeding is not initiated when the
House deliberates on the resolution passed on to it by the Committee, because
something prior to that has already been done. The action of the House is already a
further step in the proceeding, not its initiation or beginning. Rather, the proceeding
is initiated or begins, when a verified complaint is filed and referred to the
Committee on Justice for action. This is the initiating step which triggers the series
of steps that follow.[86]

Allowing an expansive construction of the term initiate beyond the act of referral
allows the unmitigated influx of successive complaints, each having their own
respective 60-session-day period of disposition from referral. Worse, the Committee
shall conduct overlapping hearings until and unless the disposition of one of the
complaints ends with the affirmance of a resolution for impeachment or the
overriding[87] of a contrary resolution (as espoused by public respondent), or the
House transmits the Articles of Impeachment (as advocated by the Reyes group),[88]
or the Committee on Justice concludes its first report to the House plenary regardless
of the recommendation (as posited by respondent-intervenor). Each of these
scenarios runs roughshod the very purpose behind the constitutionally imposed one-

111

year bar. Opening the floodgates too loosely would disrupt the series of steps
operating in unison under one proceeding.

The Court does not lose sight of the salutary reason of confining only one
impeachment proceeding in a year. Petitioner concededly cites Justice Adolfo
Azcunas separate opinion that concurred with the Francisco ruling.[89] Justice
Azcuna stated that the purpose of the one-year bar is two-fold: to prevent undue or
too frequent harassment; and 2) to allow the legislature to do its principal task [of]
legislation, with main reference to the records of the Constitutional Commission, that
reads:

MR. ROMULO. Yes, the intention here really is to limit. This is not only to protect
public officials who, in this case, are of the highest category from harassment but
also to allow the legislative body to do its work which is lawmaking. Impeachment
proceedings take a lot of time. And if we allow multiple impeachment charges on the
same individual to take place, the legislature will do nothing else but that.[90]
(underscoring supplied)

It becomes clear that the consideration behind the intended limitation refers to the
element of time, and not the number of complaints. The impeachable officer should
defend himself in only one impeachment proceeding, so that he will not be precluded
from performing his official functions and duties. Similarly, Congress should run
only one impeachment proceeding so as not to leave it with little time to attend to its
main work of law-making. The doctrine laid down in Francisco that initiation means
filing and referral remains congruent to the rationale of the constitutional provision.

Petitioner complains that an impeachable officer may be subjected to harassment by


the filing of multiple impeachment complaints during the intervening period of a
maximum of 13 session days between the date of the filing of the first impeachment
complaint to the date of referral.

As pointed out during the oral arguments[91] by the counsel for respondentintervenor, the framework of privilege and layers of protection for an impeachable
officer abound. The requirements or restrictions of a one-year bar, a single
proceeding, verification of complaint, endorsement by a House member, and a
finding of sufficiency of form and substance all these must be met before bothering a
respondent to answer already weigh heavily in favor of an impeachable officer.

Aside from the probability of an early referral and the improbability of inclusion in
the agenda of a complaint filed on the 11th hour (owing to pre-agenda standard
operating procedure), the number of complaints may still be filtered or reduced to nil
after the Committee decides once and for all on the sufficiency of form and
substance. Besides, if only to douse petitioners fear, a complaint will not last the
primary stage if it does not have the stated preliminary requisites.

To petitioner, disturbance of her performance of official duties and the deleterious


effects of bad publicity are enough oppression.

Petitioners claim is based on the premise that the exertion of time, energy and other
resources runs directly proportional to the number of complaints filed. This is non
sequitur. What the Constitution assures an impeachable officer is not freedom from
arduous effort to defend oneself, which depends on the qualitative assessment of the
charges and evidence and not on the quantitative aspect of complaints or offenses. In
considering the side of the impeachable officers, the Constitution does not promise
an absolutely smooth ride for them, especially if the charges entail genuine and grave
issues. The framers of the Constitution did not concern themselves with the media
tolerance level or internal disposition of an impeachable officer when they
deliberated on the impairment of performance of official functions. The measure of
protection afforded by the Constitution is that if the impeachable officer is made to
undergo such ride, he or she should be made to traverse it just once. Similarly, if
Congress is called upon to operate itself as a vehicle, it should do so just once. There
is no repeat ride for one full year. This is the whole import of the constitutional
safeguard of one-year bar rule.

112

Constitution and betrayal of public trust. She concludes that public respondent
gravely abused its discretion when it disregarded its own rules.

Petitioner adds that heaping two or more charges in one complaint will confuse her
in preparing her defense; expose her to the grave dangers of the highly political
nature of the impeachment process; constitute a whimsical disregard of certain rules;
impair her performance of official functions as well as that of the House; and prevent
public respondent from completing its report within the deadline.
Applicability of the Rules
on Criminal Procedure

On another plane, petitioner posits that public respondent gravely abused its
discretion when it disregarded its own Impeachment Rules, the same rules she earlier
chastised.

In the exercise of the power to promulgate rules to effectively carry out the
provisions of Section 3, Article XI of the Constitution, the House promulgated the
Impeachment Rules, Section 16 of which provides that the Rules of Criminal
Procedure under the Rules of Court shall, as far as practicable, apply to impeachment
proceedings before the House.

Finding that the Constitution, by express grant, permits the application of additional
adjective rules that Congress may consider in effectively carrying out its mandate,
petitioner either asserts or rejects two procedural devices.

First is on the one offense, one complaint rule. By way of reference to Section 16 of
the Impeachment Rules, petitioner invokes the application of Section 13, Rule 110 of
the Rules on Criminal Procedure which states that [a] complaint or information must
charge only one offense, except when the law prescribes a single punishment for
various offenses. To petitioner, the two impeachment complaints are insufficient in
form and substance since each charges her with both culpable violation of the

Public respondent counters that there is no requirement in the Constitution that an


impeachment complaint must charge only one offense, and the nature of impeachable
offenses precludes the application of the above-said Rule on Criminal Procedure
since the broad terms cannot be defined with the same precision required in defining
crimes. It adds that the determination of the grounds for impeachment is an exercise
of political judgment, which issue respondent-intervenor also considers as nonjusticiable, and to which the Baraquel group adds that impeachment is a political
process and not a criminal prosecution, during which criminal prosecution stage the
complaint or information referred thereto and cited by petitioner, unlike an
impeachment complaint, must already be in the name of the People of the
Philippines.

The Baraquel group deems that there are provisions[92] outside the Rules on
Criminal Procedure that are more relevant to the issue. Both the Baraquel and Reyes
groups point out that even if Sec. 13 of Rule 110 is made to apply, petitioners case
falls under the exception since impeachment prescribes a single punishment removal
from office and disqualification to hold any public office even for various offenses.
Both groups also observe that petitioner concededly and admittedly was not keen on
pursuing this issue during the oral arguments.

Petitioners claim deserves scant consideration.

Without going into the effectiveness of the suppletory application of the Rules on
Criminal Procedure in carrying out the relevant constitutional provisions, which
prerogative the Constitution vests on Congress, and without delving into the

113

practicability of the application of the one offense per complaint rule, the initial
determination of which must be made by the House[93] which has yet to pass upon
the question, the Court finds that petitioners invocation of that particular rule of
Criminal Procedure does not lie. Suffice it to state that the Constitution allows the
indictment for multiple impeachment offenses, with each charge representing an
article of impeachment, assembled in one set known as the Articles of Impeachment.
[94] It, therefore, follows that an impeachment complaint need not allege only one
impeachable offense.

Since public respondent, whether motu proprio or upon motion, did not yet order a
consolidation, the Court will not venture to make a determination on this matter, as it
would be premature, conjectural or anticipatory.[97]

Even if the Court assumes petitioners change of stance that the two impeachment
complaints were deemed consolidated,[98] her claim that consolidation is a legal
anomaly fails. Petitioners theory obviously springs from her proceeding = complaint
equation which the Court already brushed aside.

The second procedural matter deals with the rule on consolidation. In rejecting a
consolidation, petitioner maintains that the Constitution allows only one
impeachment complaint against her within one year.

Records show that public respondent disavowed any immediate need to consolidate.
Its chairperson Rep. Tupas stated that [c]onsolidation depends on the Committee
whether to consolidate[; c]onsolidation may come today or may come later on after
determination of the sufficiency in form and substance, and that for purposes of
consolidation, the Committee will decide when is the time to consolidate[, a]nd if,
indeed, we need to consolidate.[95] Petitioners petition, in fact, initially describes the
consolidation as merely contemplated.[96]

WHEREFORE, the petition is DISMISSED. The assailed Resolutions of September


1, 2010 and September 7, 2010 of public respondent, the House of Representatives
Committee on Justice, are NOT UNCONSTITUTIONAL. The Status Quo Ante
Order issued by the Court on September 14, 2010 is LIFTED.

SO ORDERED.
LIWAYWAY VINZONS-CHATO,
Petitioner,
- versus -

114

TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
NACHURA,
FORTUNE TOBACCO CORPORATION,
Respondent.

REYES,
LEONARDO-DE CASTRO, and
BRION, JJ.

Promulgated:

G.R. No. 141309

December 23, 2008


x-----------------------------------------------------------------------------------------x
RESOLUTION

Present:
PUNO, C.J.,

NACHURA, J.:

QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,*

It is a fundamental principle in the law of public officers that a duty owing to the
public in general cannot give rise to a liability in favor of particular individuals.[1]
The failure to perform a public duty can constitute an individual wrong only when a
person can show that, in the public duty, a duty to himself as an individual is also
involved, and that he has suffered a special and peculiar injury by reason of its
improper performance or non-performance.[2]

CARPIO MORALES,
AZCUNA,

By this token, the Court reconsiders its June 19, 2007 Decision[3] in this case.

115

RMC 37-93 violated its constitutional right against deprivation of property without
due process of law and the right to equal protection of the laws.
As culled from the said decision, the facts, in brief, are as follows:

On June 10, 1993, the legislature enacted Republic Act No. 7654 (RA 7654), which
took effect on July 3, 1993. Prior to its effectivity, cigarette brands Champion, Hope,
and More were considered local brands subjected to an ad valorem tax at the rate of
20-45%. However, on July 1, 1993, or two days before RA 7654 took effect,
petitioner issued RMC 37-93 reclassifying Champion, Hope, and More as locally
manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax.
RMC 37-93 in effect subjected Hope, More, and Champion cigarettes to the
provisions of RA 7654, specifically, to Sec. 142, (c)(1) on locally manufactured
cigarettes which are currently classified and taxed at 55%, and which imposes an ad
valorem tax of 55% provided that the minimum tax shall not be less than Five Pesos
(P5.00) per pack.

On July 2, 1993, at about 5:50 p.m., BIR Deputy Commissioner Victor A. Deoferio,
Jr. sent via telefax a copy of RMC 37-93 to Fortune Tobacco but it was addressed to
no one in particular. On July 15, 1993, Fortune Tobacco received, by ordinary mail, a
certified xerox copy of RMC 37-93. On July 20, 1993, respondent filed a motion for
reconsideration requesting the recall of RMC 37-93, but was denied in a letter dated
July 30, 1993. The same letter assessed respondent for ad valorem tax deficiency
amounting to P9,598,334.00 (computed on the basis of RMC 37-93) and demanded
payment within 10 days from receipt thereof. On August 3, 1993, respondent filed a
petition for review with the Court of Tax Appeals (CTA), which on September 30,
1993, issued an injunction enjoining the implementation of RMC 37-93. In its
decision dated August 10, 1994, the CTA ruled that RMC 37-93 is defective, invalid,
and unenforceable and further enjoined petitioner from collecting the deficiency tax
assessment issued pursuant to RMC No. 37-93. This ruling was affirmed by the
Court of Appeals, and finally by this Court in Commissioner of Internal Revenue v.
Court of Appeals. It was held, among others, that RMC 37-93, has fallen short of the
requirements for a valid administrative issuance.

Petitioner filed a motion to dismiss contending that: (1) respondent has no cause of
action against her because she issued RMC 37-93 in the performance of her official
function and within the scope of her authority. She claimed that she acted merely as
an agent of the Republic and therefore the latter is the one responsible for her acts;
(2) the complaint states no cause of action for lack of allegation of malice or bad
faith; and (3) the certification against forum shopping was signed by respondents
counsel in violation of the rule that it is the plaintiff or the principal party who should
sign the same.

On September 29, 1997, the RTC denied petitioners motion to dismiss holding that to
rule on the allegations of petitioner would be to prematurely decide the merits of the
case without allowing the parties to present evidence. It further held that the defect in
the certification against forum shopping was cured by respondents submission of the
corporate secretarys certificate authorizing its counsel to execute the certification
against forum shopping. x x x x

xxxx

The case was elevated to the Court of Appeals via a petition for certiorari under Rule
65. However, same was dismissed on the ground that under Article 32 of the Civil
Code, liability may arise even if the defendant did not act with malice or bad faith.
The appellate court ratiocinated that Section 38, Book I of the Administrative Code
is the general law on the civil liability of public officers while Article 32 of the Civil
Code is the special law that governs the instant case. Consequently, malice or bad
faith need not be alleged in the complaint for damages. It also sustained the ruling of
the RTC that the defect of the certification against forum shopping was cured by the
submission of the corporate secretarys certificate giving authority to its counsel to
execute the same.[4] [Citations and underscoring omitted.]

On April 10, 1997, respondent filed before the RTC a complaint for damages against
petitioner in her private capacity. Respondent contended that the latter should be held
liable for damages under Article 32 of the Civil Code considering that the issuance of

116

In the aforesaid June 19, 2007 Decision, we affirmed the disposition of the Court of
Appeals (CA) and directed the trial court to continue with the proceedings in Civil
Case No. 97-341-MK.[5]

Petitioner, on July 20, 2007, subsequently moved for the reconsideration of the said
decision.[6] After respondent filed its comment, the Court, in its April 14, 2008
Resolution,[7] denied with finality petitioners motion for reconsideration.

Undaunted, petitioner filed, on April 29, 2008 her Motion to Refer [the case] to the
Honorable Court En Banc.[8] She contends that the petition raises a legal question
that is novel and is of paramount importance. The earlier decision rendered by the
Court will send a chilling effect to public officers, and will adversely affect the
performance of duties of superior public officers in departments or agencies with
rule-making and quasi-judicial powers. With the said decision, the Commissioner of
Internal Revenue will have reason to hesitate or refrain from performing his/her
official duties despite the due process safeguards in Section 228 of the National
Internal Revenue Code.[9] Petitioner hence moves for the reconsideration of the June
19, 2007 Decision.[10]

In its June 25, 2008 Resolution,[11] the Court referred the case to the En Banc.
Respondent consequently moved for the reconsideration of this resolution.

We now resolve both motions.

There are two kinds of duties exercised by public officers: the duty owing to the
public collectively (the body politic), and the duty owing to particular individuals,
thus:

1. Of Duties to the Public. The first of these classes embraces those officers whose
duty is owing primarily to the public collectively --- to the body politic --- and not to
any particular individual; who act for the public at large, and who are ordinarily paid
out of the public treasury.

The officers whose duties fall wholly or partially within this class are numerous and
the distinction will be readily recognized. Thus, the governor owes a duty to the
public to see that the laws are properly executed, that fit and competent officials are
appointed by him, that unworthy and ill-considered acts of the legislature do not
receive his approval, but these, and many others of a like nature, are duties which he
owes to the public at large and no one individual could single himself out and assert
that they were duties owing to him alone. So, members of the legislature owe a duty
to the public to pass only wise and proper laws, but no one person could pretend that
the duty was owing to himself rather than to another. Highway commissioners owe a
duty that they will be governed only by considerations of the public good in deciding
upon the opening or closing of highways, but it is not a duty to any particular
individual of the community.

These illustrations might be greatly extended, but it is believed that they are
sufficient to define the general doctrine.

2. Of Duties to Individuals. The second class above referred to includes those who,
while they owe to the public the general duty of a proper administration of their
respective offices, yet become, by reason of their employment by a particular
individual to do some act for him in an official capacity, under a special and
particular obligation to him as an individual. They serve individuals chiefly and
usually receive their compensation from fees paid by each individual who employs
them.

A sheriff or constable in serving civil process for a private suitor, a recorder of deeds
in recording the deed or mortgage of an individual, a clerk of court in entering up a
private judgment, a notary public in protesting negotiable paper, an inspector of
elections in passing upon the qualifications of an elector, each owes a general duty of
official good conduct to the public, but he is also under a special duty to the
particular individual concerned which gives the latter a peculiar interest in his due
performance.[12]

117

reconsideration) that Article 32, in fact, allows a damage suit for tort for impairment
of rights and liberties.[20]

In determining whether a public officer is liable for an improper performance or nonperformance of a duty, it must first be determined which of the two classes of duties
is involved. For, indeed, as the eminent Floyd R. Mechem instructs, [t]he liability of
a public officer to an individual or the public is based upon and is co-extensive with
his duty to the individual or the public. If to the one or the other he owes no duty, to
that one he can incur no liability.[13]

Stated differently, when what is involved is a duty owing to the public in general, an
individual cannot have a cause of action for damages against the public officer, even
though he may have been injured by the action or inaction of the officer. In such a
case, there is damage to the individual but no wrong to him. In performing or failing
to perform a public duty, the officer has touched his interest to his prejudice; but the
officer owes no duty to him as an individual.[14] The remedy in this case is not
judicial but political.[15]

The exception to this rule occurs when the complaining individual suffers a
particular or special injury on account of the public officers improper performance or
non-performance of his public duty. An individual can never be suffered to sue for an
injury which, technically, is one to the public only; he must show a wrong which he
specially suffers, and damage alone does not constitute a wrong.[16] A contrary
precept (that an individual, in the absence of a special and peculiar injury, can still
institute an action against a public officer on account of an improper performance or
non-performance of a duty owing to the public generally) will lead to a deluge of
suits, for if one man might have an action, all men might have the likethe
complaining individual has no better right than anybody else.[17] If such were the
case, no one will serve a public office. Thus, the rule restated is that an individual
cannot have a particular action against a public officer without a particular injury, or
a particular right, which are the grounds upon which all actions are founded.[18]
Juxtaposed with Article 32[19] of the Civil Code, the principle may now translate
into the rule that an individual can hold a public officer personally liable for damages
on account of an act or omission that violates a constitutional right only if it results
in a particular wrong or injury to the former. This is consistent with this Courts
pronouncement in its June 19, 2007 Decision (subject of petitioners motion for

It may be recalled that in tort law, for a plaintiff to maintain an action for damages
for the injuries of which he complains, he must establish that such injuries resulted
from a breach of duty which the defendant owed the plaintiff, meaning a concurrence
of injury to the plaintiff and legal responsibility by the person causing it. Indeed,
central to an award of tort damages is the premise that an individual was injured in
contemplation of law.[21] Thus, in Lim v. Ponce de Leon,[22] we granted the
petitioners claim for damages because he, in fact, suffered the loss of his motor
launch due to the illegal seizure thereof. In Cojuangco, Jr. v. Court of Appeals,[23]
we upheld the right of petitioner to the recovery of damages as there was an injury
sustained by him on account of the illegal withholding of his horserace prize
winnings.

In the instant case, what is involved is a public officers duty owing to the public in
general. The petitioner, as the then Commissioner of the Bureau of Internal Revenue,
is being taken to task for Revenue Memorandum Circular (RMC) No. 37-93 which
she issued without the requisite notice, hearing and publication, and which, in
Commissioner of Internal Revenue v. Court of Appeals,[24] we declared as having
fallen short of a valid and effective administrative issuance.[25] A public officer,
such as the petitioner, vested with quasi-legislative or rule-making power, owes a
duty to the public to promulgate rules which are compliant with the requirements of
valid administrative regulations. But it is a duty owed not to the respondent alone,
but to the entire body politic who would be affected, directly or indirectly, by the
administrative rule.
Furthermore, as discussed above, to have a cause of action for damages against the
petitioner, respondent must allege that it suffered a particular or special injury on
account of the non-performance by petitioner of the public duty. A careful reading of
the complaint filed with the trial court reveals that no particular injury is alleged to
have been sustained by the respondent. The phrase financial and business
difficulties[26] mentioned in the complaint is a vague notion, ambiguous in concept,
and cannot translate into a particular injury. In contrast, the facts of the case
eloquently demonstrate that the petitioner took nothing from the respondent, as the
latter did not pay a single centavo on the tax assessment levied by the former by
virtue of RMC 37-93.

With no particular injury alleged in the complaint, there is, therefore, no delict or
wrongful act or omission attributable to the petitioner that would violate the primary

118

rights of the respondent. Without such delict or tortious act or omission, the
complaint then fails to state a cause of action, because a cause of action is the act or
omission by which a party violates a right of another.[27]

A cause of action exists if the following elements are present: (1) a right in favor of
the plaintiff by whatever means and under whatever law it arises or is created; (2) an
obligation on the part of the named defendant to respect or not to violate such right;
and (3) an act or omission on the part of such defendant violative of the right of the
plaintiff or constituting a breach of the obligation of defendant to plaintiff for which
the latter may maintain an action for recovery of damages.[28]
The remedy of a party whenever the complaint does not allege a cause of action is to
set up this defense in a motion to dismiss, or in the answer. A motion to dismiss
based on the failure to state a cause of action in the complaint hypothetically admits
the truth of the facts alleged therein. However, the hypothetical admission is limited
to the relevant and material facts well-pleaded in the complaint and inferences
deducible therefrom. The admission does not extend to conclusions or interpretations
of law; nor does it cover allegations of fact the falsity of which is subject to judicial
notice.[29]

The complaint may also be dismissed for lack of cause of action if it is obvious from
the complaint and its annexes that the plaintiff is not entitled to any relief.[30]

The June 19, 2007 Decision and the dissent herein reiterates that under Article 32 of
the Civil Code, the liability of the public officer may accrue even if he/she acted in
good faith, as long as there is a violation of constitutional rights, citing Cojuangco,
Jr. v. Court of Appeals,[31] where we said:

Under the aforecited article, it is not necessary that the public officer acted with
malice or bad faith. To be liable, it is enough that there was a violation of the
constitutional rights of petitioners, even on the pretext of justifiable motives or good
faith in the performance of duties.[32]

The complaint in this case does not impute bad faith on the petitioner. Without any
allegation of bad faith, the cause of action in the respondents complaint (specifically,
paragraph 2.02 thereof) for damages under Article 32 of the Civil Code would be
premised on the findings of this Court in Commissioner of Internal Revenue v. Court
of Appeals (CIR v. CA),[33] where we ruled that RMC No. 37-93, issued by
petitioner in her capacity as Commissioner of Internal Revenue, had fallen short of a
valid and effective administrative issuance. This is a logical inference. Without the
decision in CIR v. CA, the bare allegations in the complaint that respondents rights
to due process of law and to equal protection of the laws were violated by the
petitioners administrative issuance would be conclusions of law, hence not
hypothetically admitted by petitioner in her motion to dismiss.

But in CIR v. CA, this Court did not declare RMC 37-93 unconstitutional; certainly
not from either the due process of law or equal protection of the laws perspective. On
due process, the majority, after determining that RMC 37-93 was a legislative rule,
cited an earlier Revenue Memorandum Circular (RMC No. 10-86) requiring prior
notice before RMCs could become operative. However, this Court did not make an
express finding of violation of the right to due process of law. On the aspect of equal
protection, CIR v. CA said: Not insignificantly, RMC 37-93 might have likewise
infringed on uniformity of taxation; a statement that does not amount to a positive
indictment of petitioner for violation of respondents constitutional right. Even if one
were to ascribe a constitutional infringement by RMC 37-93 on the non-uniformity
of tax provisions, the nature of the constitutional transgression falls under Section
28, Article VInot Section 1, Article IIIof the Constitution.

This Courts own summation in CIR v. CA: All taken, the Court is convinced that the
hastily promulgated RMC 37-93 has fallen short of a valid and effective
administrative issuance, does not lend itself to an interpretation that the RMC is
unconstitutional. Thus, the complaints reliance on CIR v. CAwhich is cited in, and a
copy of which is annexed to, the complaintas suggestive of a violation of due process
and equal protection, must fail.

Accordingly, from the foregoing discussion, it is obvious that paragraph 2.02 of


respondents complaint loses the needed crutch to sustain a valid cause of action

119

against the petitioner, for what is left of the paragraph is merely the allegation that
only respondents Champion, Hope and More cigarettes were reclassified.

If we divest the complaint of its reliance on CIR v. CA, what remains of respondents
cause of action for violation of constitutional rights would be paragraph 2.01, which
reads:

2.01. On or about July 1, 1993, defendant issued Revenue Memorandum Circular


No. 37-93 (hereinafter referred to as RMC No. 37-93) reclassifying specifically
Champion, Hope and More as locally manufactured cigarettes bearing a foreign
brand. A copy of the aforesaid circular is attached hereto and made an integral part
hereof as ANNEX A. The issuance of a circular and its implementation resulted in
the deprivation of property of plaintiff. They were done without due process of law
and in violation of the right of plaintiff to the equal protection of the laws. (Italics
supplied.)

But, as intimated above, the bare allegations, done without due process of law and in
violation of the right of plaintiff to the equal protection of the laws are conclusions of
law. They are not hypothetically admitted in petitioners motion to dismiss and, for
purposes of the motion to dismiss, are not deemed as facts.

provision with subsequent legislative enactments, particularly those related to


taxation and tax collection. Judicial notice may be taken of the provisions of the
National Internal Revenue Code, as amended, and of the law creating the Court of
Tax Appeals. Both statutes provide ample remedies to aggrieved taxpayers; remedies
which, in fact, were availed of by the respondentwithout even having to pay the
assessment under protestas recounted by this Court in CIR v. CA, viz.:

In a letter, dated 19 July 1993, addressed to the appellate division of the BIR,
Fortune Tobacco requested for a review, reconsideration and recall of RMC 37-93.
The request was denied on 29 July 1993. The following day, or on 30 July 1993, the
CIR assessed Fortune Tobacco for ad valorem tax deficiency amounting to
P9,598,334.00.

On 03 August 1993, Fortune Tobacco filed a petition for review with the CTA.[35]

The availability of the remedies against the assailed administrative action, the
opportunity to avail of the same, and actual recourse to these remedies, contradict the
respondents claim of due process infringement.

At this point, a brief examination of relevant American jurisprudence may be


instructive.
In Fluor Daniel, Inc. Philippines v. EB. Villarosa & Partners Co., Ltd.,[34] this Court
declared that the test of sufficiency of facts alleged in the complaint as constituting a
cause of action is whether or not, admitting the facts alleged, the court could render a
valid verdict in accordance with the prayer of the complaint. In the instant case, since
what remains of the complaint which is hypothetically admitted, is only the
allegation on the reclassification of respondents cigarettes, there will not be enough
facts for the court to render a valid judgment according to the prayer in the
complaint.

Furthermore, in an action for damages under Article 32 of the Civil Code premised
on violation of due process, it may be necessary to harmonize the Civil Code

42 U.S. Code 1983, a provision incorporated into the Civil Rights Act of 1871,
presents a parallel to our own Article 32 of the Civil Code, as it states:

Every person who, under color of any statute, ordinance, regulation, custom, usage,
or any State or Territory, subjects, or causes to be subjected, any citizen of the United
States or other person within the jurisdiction thereof to the deprivation of any rights,

120

privileges or immunities secured by the Constitution and laws, shall be liable to the
party injured in an action at law, suit in equity or other proper proceeding for redress.

This provision has been employed as the basis of tort suits by many petitioners
intending to win liability cases against government officials when they violate the
constitutional rights of citizens.

Webster Bivens v. Six Unknown Named Agents of Federal Bureau of Investigation,


[36] has emerged as the leading case on the victims entitlement to recover money
damages for any injuries suffered as a result of flagrant and unconstitutional abuses
of administrative power. In this case, federal narcotics officers broke into Bivens
home at 6:30 a.m. without a search warrant and in the absence of probable cause.
The agents handcuffed Bivens, searched his premises, employed excessive force,
threatened to arrest his family, subjected him to a visual strip search in the federal
court house, fingerprinted, photographed, interrogated and booked him. When
Bivens was brought before a United States Commissioner, however, charges against
him were dismissed. On the issue of whether violation of the Fourth Amendment by
a federal agent acting under color of authority gives rise to a cause of action for
damages consequent upon his constitutional conduct, the U.S. Supreme Court held
that Bivens is entitled to recover damages for injuries he suffered as a result of the
agents violation of the Fourth Amendment.

A number of subsequent decisions have upheld Bivens. For instance, in Scheuer v.


Rhodes,[37] a liability suit for money damages was allowed against Ohio Governor
James Rhodes by petitioners who represented three students who had been killed by
Ohio National Guard troops at Kent State University as they protested against U.S.
involvement in Vietnam. In Wood v. Strickland,[38] local school board members
were sued by high school students who argued that they had been deprived of
constitutional due process rights when they were expelled from school for having
spiked a punch bowl at a school function without the benefit of a full hearing. In
Butz v. Economou,[39] Economou, whose registration privilege as a commodities
futures trader was suspended, without prior warning, by Secretary of Agriculture Earl
Butz, sued on a Bivens action, alleging that the suspension was aimed at chilling his
freedom of expression right under the First Amendment. A number of other cases[40]
with virtually the same conclusion followed.

However, it is extremely dubious whether a Bivens action against government tax


officials and employees may prosper, if we consider the pronouncement of the U.S.
Supreme Court in Schweiker v. Chilicky,[41] that a Bivens remedy will not be
allowed when other meaningful safeguards or remedies for the rights of persons
situated as (is the plaintiff) are available. It has also been held that a Bivens action is
not appropriate in the civil service system[42] or in the military justice system.[43]

In Frank Vennes v. An Unknown Number of Unidentified Agents of the United States


of America,[44] petitioner Vennes instituted a Bivens action against agents of the
Internal Revenue Service (IRS) who alleged that he (Vennes) owed $250,000 in tax
liability, instituted a jeopardy assessment, confiscated Vennes business, forced a total
asset sale, and put Vennes out of business, when in fact he owed not a dime. The U.S.
Court of Appeals, Eighth Circuit, ruled:

The district court dismissed these claims on the ground that a taxpayers remedies
under the Internal Revenue Code preclude such a Bivens action. Vennes cites to us
no contrary authority, and we have found none. Though the Supreme Court has not
addressed this precise question, it has strongly suggested that the district court
correctly applied Bivens:

When the design of a Government program suggests that Congress has provided
what it considers adequate remedial mechanisms for constitutional violations that
may occur in the course of its administration, we have not created additional Bivens
remedies.

xxxx

Congress has provided specific and meaningful remedies for taxpayers who
challenge overzealous tax assessment and collection activities. A taxpayer may
challenge a jeopardy assessment both administratively and judicially, and may sue
the government for a tax refund, and have authorized taxpayer actions against the
United States to recover limited damages resulting from specific types of misconduct

121

by IRS employees. These carefully crafted legislative remedies confirm that, in the
politically sensitive realm of taxation, Congresss refusal to permit unrestricted
damage action by taxpayers has not been inadvertent. Thus, the district court
correctly dismissed Venness Bivens claims against IRS agents for their tax
assessment and collection activities.

In still another Bivens action, instituted by a taxpayer against IRS employees for
alleged violation of due process rights concerning a tax dispute, the U.S. District
Court of Minnesota said:

In addition, the (Tax) Code provides taxpayers with remedies, judicial and otherwise,
for correcting and redressing wrongful acts taken by IRS employees in connection
with any collection activities. Although these provisions do not provide taxpayers
with an all-encompassing remedy for wrongful acts of IRS personnel, the rights
established under the Code illustrate that it provides all sorts of rights against the
overzealous officialdom, including, most fundamentally, the right to sue the
government for a refund if forced to overpay taxes, and it would make the collection
of taxes chaotic if a taxpayer could bypass the remedies provided by Congress
simply by bringing a damage suit against IRS employees.[45]

Section 227. Satisfaction of Judgment Recovered Against any Internal Revenue


Officer. When an action is brought against any Internal Revenue officer to recover
damages by reason of any act done in the performance of official duty, and the
Commissioner is notified of such action in time to make defense against the same,
through the Solicitor General, any judgment, damages or costs recovered in such
action shall be satisfied by the Commissioner, upon approval of the Secretary of
Finance, or if the same be paid by the person sued shall be repaid or reimbursed to
him.

No such judgment, damages or costs shall be paid or reimbursed in behalf of a


person who has acted negligently or in bad faith, or with willful oppression.

Because the respondents complaint does not impute negligence or bad faith to the
petitioner, any money judgment by the trial court against her will have to be assumed
by the Republic of the Philippines. As such, the complaint is in the nature of a suit
against the State.[46]

WHEREFORE, premises considered, we GRANT petitioners motion for


reconsideration of the June 19, 2007 Decision and DENY respondents motion for
reconsideration of the June 25, 2008 Resolution. Civil Case No. CV-97-341-MK,
pending with the Regional Trial Court of Marikina City, is DISMISSED.
American jurisprudence obviously validates the contention of the petitioner.

Finally, we invite attention to Section 227, Republic Act No. 8424 (Tax Reform Act
of 1997), which provides:
[G.R. No. 147227. November 19, 2004]
MARIA REMEDIOS ARGANA, DONATA ALMENDRALA VDA. DE ARGANA,
LUIS ARGANA, JR., PEREGRINO ARGANA, ESTATE OF GELACIO ARGANA,
EUFROCINIO NOFUENTE, AMPARO ARGANA NOFUENTE, JUANITO

SO ORDERED.
ROGELIO, MILAGROS ARGANA ROGELIO, MARIA FELICIDAD ARGANA,
MARIA DOROTEA ARGANA, REFEDOR SOUTH GOLD PROPERTY
MANAGEMENT & DEVELOPMENT CORPORATION, petitioners, vs.
REPUBLIC OF THE PHILIPPINES, respondent.

122

DECISION
TINGA, J.:
Before the Court is a Petition for Certiorari assailing the Resolution dated April 11,
2000 and the Order dated February 22, 2001 of the Sandiganbayan, Third Division,
in Civil Case No. 0026.[1]
On July 29, 1987, respondent Republic of the Philippines filed with the
Sandiganbayan a Petition for Forfeiture of alleged ill-gotten assets and properties of
the late Maximino A. Argana, who served as Mayor of the Municipality of
Muntinlupa[2] from 1964 to 1967 and from 1972 until his death in 1985.

On September 18, 1997, respondent, represented by PCGG Commissioners


Reynaldo S. Guiao and Herminio A. Mendoza entered into a Compromise
Agreement with petitioners, represented by petitioner Maria Felicidad Argana.
Petitioners conveyed, ceded and released in favor of respondent a total of 361.9203
hectares of agricultural land in Pangil and Famy, Laguna, or 75.12% of the properties
subject of litigation, in consideration of the dismissal or withdrawal of all pending
civil, criminal and administrative cases filed, litigated or investigated by respondent
against them. The remainder was distributed as follows:
To be retained by the late
Mayor Arganas heirs 9.88% 47.78787

On October 28, 1998, the Sandiganbayan remanded the case to the Presidential
Commission on Good Government (PCGG) for the conduct of an inquiry. In 1990,
the case was reactivated in the Sandiganbayan. Petitioners Maria Remedios Argana,
Donata Almendrala Vda. De Argana, Luis Argana, Jr., Peregrino Argana, Estate of
Gelacio Argana, Eufrocinio Nofuente, Amparo Argana Nofuente, Juanito Rogelio,
Milagros Argana Rogelio, Maria Felicidad Argana, Maria Dorotea Argana, and
Refedor South Gold Property Management & Development Corporation filed a
series of motions, including a Motion to Dismiss on the ground of the lack of
authority of the PCGG to institute the case on behalf of respondent. This issue
eventually reached this Court and was decided in favor of respondent on September
29, 1994.[3]

hectares

Petitioners, in their Answer, denied that the properties sought to be forfeited by


respondent were unlawfully acquired by the deceased Mayor and/or by petitioners.
Still, to avoid a protracted litigation, petitioners exerted efforts to settle the case
amicably with respondent through the PCGG.

hectares

Owned by the Mayors


Brothers and Sisters 5.53% 26.6318
hectares
Foreclosed by Los Baos
Rural Bank 1.24% 5.9856

Owned by Other Persons 8.23% 39.64865


hectares

After a series of motions were again filed by petitioners, the Sandiganbayan finally
set the case for pre-trial on November 26, 1997, but the pre-trial was reset several
times in view of the manifestation of the parties that they were in the process of
negotiating a compromise.
On August 7, 1997, petitioners offer of compromise was accepted by the PCGG in its
Resolution No. 97-180-A.[4]
Thereafter, the PCGG conducted an evaluation of the properties offered for
settlement by petitioners. In a Memorandum dated August 18, 1997, Mauro J.
Estrada, Director of the PCGG Research and Development Program, recommended
the inclusion of another tract of land[5] belonging to petitioners among the properties
which would be subject of the compromise.

____________________________
24.88% 120.05392
hectares[6]
In a letter dated October 7, 1997,[7] the PCGG informed the Office of the Solicitor
General (OSG) of the signing of the Compromise Agreement and requested the OSG
to file the appropriate motion for approval thereof with the Sandiganbayan.
Subsequently, the OSG requested for clarification from the PCGG if the compromise
agreement included all the sequestered assets of petitioners subject of litigation. In
response to the request, PCGG informed the OSG in a letter dated February 4,

123

1998[8] that the properties mentioned in the Compromise Agreement comprise all
the sequestered assets subject of litigation, and reiterated that it entered into a
compromise agreement with petitioners because it believed that the evidence might
not be sufficient to warrant continuing the prosecution of Civil Case No. 0026 and
that it is to the best interest of the government to accept the offer of petitioners.[9]
On May 27, 1998, then President of the Republic of the Philippines Fidel V. Ramos
approved the Compromise Agreement between petitioners and respondent.[10]
On June 4, 1998,[11] the OSG filed with the Sandiganbayan a Motion to Approve
Compromise Agreement. Petitioners expressed their conformity to the motion on
June 15, 1998.
After conducting hearings on the motion, the Sandiganbayan promulgated its
Decision on July 31, 1998 approving the Compromise Agreement and rendering
judgment in accordance with the terms thereof.[12]
However, on October 5, 1998, respondent, through the OSG and the PCGG, filed
with the Sandiganbayan a Motion to Rescind Compromise Agreement and to Set
Aside Judgment by Compromise (Motion to Rescind). Respondent prayed for the
rescission of the Compromise Agreement or reformation thereof after a renegotiation
with petitioners. Respondent contended that the partition of the properties in the
Compromise Agreement was grossly disadvantageous to the government and that
there was fraud and insidious misrepresentation by petitioners in the distribution and
partition of properties, to the damage and prejudice of the government. According to
respondent, there was fraud and insidious misrepresentation because petitioners
proposed to divide the propertieswith 75% accruing to the government and the
remaining 25% going to petitioners and their other creditorsbased on the total land
area of the properties instead of on their value. As a result, the government obtained
only Three Million Six Hundred Twenty Thousand Pesos (P3,620,000.00) worth of
land, while petitioners received almost Four Billion Pesos (P4,000,000,000.00)
worth.
Petitioners filed an Answer to the Motion to Rescind and contended that the July 31,
1998 Decision of the Sandiganbayan could no longer be annulled because it had
already become final and executory; that respondents counsel had no authority to file
the motion; and that the motion was defective because it did not include a
Certification against Forum-Shopping. They also argued that there was no agreement
to divide the properties by a 75% to 25% ratio in favor of the government. What they
proposed to cede to the government by way of compromise were their properties in
Pangil covered by Transfer Certificate of Title (TCT) Nos. T-4044 and T-4009 and
those in Famy, Laguna covered by TCT Nos. T-3813 to T-3817 and T-4104, 4106 and
4108, not a specific percentage of the properties subject of litigation.[13]

In its Resolution dated September 22, 1999, the Sandiganbayan treated the Motion to
Rescind as a petition for relief from judgment under Rule 38 of the 1997 Rules on
Civil Procedure and set the motion for hearing.
On April 11, 2000, the Sandiganbayan issued a Resolution granting respondents
motion to rescind and setting aside the Decision dated July 31, 1998. The
Sandiganbayan held that the Motion to Rescind was filed on time on October 5,
1998, the working day immediately following October 4, 1998, which was a Sunday
and the 60th day after respondent received the July 31, 1998 Decision on August 5,
1998. It also ruled that the presumption that the OSG had authority to file the Motion
to Rescind was not overcome by petitioners. Under Republic Act No. 1379,[14] the
filing and prosecution of cases for forfeiture of unlawfully acquired property is a
function of the OSG. Petitioners failed to show proof that pleadings or motions filed
by lawyers of the government or the PCGG must first be approved by the PCGG En
Banc and by the President of the Republic. The Sandiganbayan likewise held that
respondent was not required to file a certification against forum-shopping because
the motion to rescind was not an initiatory pleading.[15]
With respect to the issue of fraud, it held that there was extrinsic fraud in the
execution of the Compromise Agreement. The Sandiganbayan stated:
The values were deliberately omitted to make it appear that the Compromise
Agreement adheres to the 75%-25% ratio broadly adopted by the PCGG in
compromising cases of ill-gotten wealth. It was this 75%-25% mode of compromise,
with the greater share of 75% going to the government that misled the Court to
believe, as We did believe, that the Compromise Agreement was fair, reasonable and
advantageous to the Government.
What was projected to be a 75%-25% ratio was in reality a 00.15%-99.85% ratio,
with 99.85% going to the Arganas. This is unconscionable and immoral. And since it
results in a transaction grossly disadvantageous and immoral to the government, it is
against the law as being violative of Section 3(g) of Republic Act 3019.
In the instant case, fraud of an extrinsic character exists because the representatives
of plaintiff Republic in the PCGG connived with defendants in hiding the assessed or
market values of the properties involved, so as to make it appear that the
Compromise Agreement adhered to the 75%-25% ratio adopted by the PCGG in
entering into compromise of cases involving the recovery of ill-gotten wealth.
Through their infidelity, those in the PCGG who handled or were closely involved
with the case during the last days of the previous administration fraudulently gave
the Compromise Agreement a semblance of fairness and official acceptability. They
sold plaintiff Republic down the river by entering into an agreement grossly
disadvantageous to the government. For while plaintiff Republic got 00.15%
(00.15074) of the estimated value of all the properties involved in this case,

124

defendants almost ran away with 99.85% (99.84526) of their value. This is patently
unfair. It is no compromise but a virtual sell-out. It could not have been pulled off
without the connivance or collusion of those responsible for the case in the PCGG.
Instead of protecting the interest of the government, they connived at its
defeatalmost.[16]

2. It was filed out of time.

Petitioners filed a Motion for Reconsideration dated May 9, 2000 and a Supplement
to said motion dated May 30, 2000. Petitioners also filed an Urgent Motion for
Voluntary Inhibition dated May 18, 2000 praying that the members of the Third
Division of the Sandiganbayan voluntarily inhibit themselves from hearing and
resolving the petitioners pending motions.

(D) There is no factual or legal basis for the finding of fraud by the Sandiganbayan
(Third Division).

On February 22, 2001, the Sandiganbayan issued two Orders, one denying
petitioners motion for reconsideration,[17] and the other, denying the motion for
voluntary inhibition.[18]
Hence, petitioners filed the present petition on April 27, 2001.

3. It was filed sans any supporting Affidavit of Merit.


4. It lacked the required Certification on Non-Forum Shopping.

(E) Upon approval of the Compromise Agreement, the Sandiganbayan (Third


Division) lost jurisdiction over the case, including the authority to rescind said
Compromise Agreement and to set aside the judgment based thereon.
(F) The Sandiganbayan (Third Division) lacked authority to alter a contract by
construction or to make a new contract for the parties.
(G) Since the Compromise Agreement had already been implemented, rescission
cannot be availed of.[20]

Respondent filed its Comment on October 22, 2001.


On November 12, 2001, the Court issued a Resolution giving due course to the
petition and requiring the parties to submit their respective memoranda.[19]
Respondent filed its Memorandum on January 29, 2002. Petitioners filed theirs on
February 26, 2002. In their respective memoranda, the parties reiterated the
arguments in their earlier pleadings.
Specifically, petitioners raise the following arguments:
(A) The Sandiganbayan (Third Division) denied Petitioners their right to substantive
and procedural due process when it refused to voluntarily inhibit itself from further
hearing the instant case.
(B) The PCGG lawyers had no authority to ask for the rescission of the subject
Compromise Agreement without the consent of the PCGG En Banc and the President
of the Republic of the Philippines.
(C) The Motion to Rescind, which was treated by the Sandiganbayan (Third
Division) as a Petition for Relief under Rule 38 of the Rules of Court, is fatally
defective because
1. It was not filed by a party to the case, i.e., it was filed by counsel without the
clients authority.

Petitioners contend that the members of the Third Division of the Sandiganbayan
should have inhibited themselves from resolving petitioners motion for
reconsideration because from the tenor of the April 11, 2000 Order of the court
granting respondents motion to rescind, it was evident that the Sandiganbayan had
already prejudged the properties subject of litigation as having been unlawfully
acquired.[21]
Petitioners likewise assert that the property value of a property offered for the
amicable settlement of a case is not always material in determining the validity of a
compromise agreement. They point out that what impelled the PCGG to enter into a
compromise agreement with them was PCGGs perception that its evidence against
petitioners was weak and might not be sufficient to justify maintaining the case
against them.[22]
In addition, petitioners insist that the Motion to Rescind which was treated by the
Sandiganbayan as a petition for relief from judgment under Rule 38 is fatally
defective for (i) lack of authority of respondents lawyers to file the same; (ii) having
been filed out of time; (iii) non-submission of an Affidavit of Merit; and (iv) nonsubmission of a Certification against Forum-Shopping.[23]
It is argued by petitioners that the Sandiganbayan should have denied respondents
Motion to Rescind outright for having been filed without authority from the PCGG
En Banc and the President of the Republic, both of whom earlier approved and
authorized the execution of the Compromise Agreement. According to petitioners,
after final judgment has been rendered in a case, an attorney has no implied authority

125

from his client to seek material or substantial alterations or modifications in such


judgment.[24]
Petitioners claim that the Motion to Rescind was filed only on October 5, 1998, or
beyond sixty (60) days from the time the Sandiganbayan promulgated its July 31,
1998 Decision approving the Compromise Agreement.[25] In support of their
petition, petitioners cite Section 3 of Rule 38 which requires that the petition for
relief be filed within sixty (60) days after the party seeking the relief learns of the
judgment or final order to be set aside, and not more than six (6) months after such
judgment or final order was entered. They also invoke the case of Samonte v.
Samonte[26] where the Court held that a judgment upon compromise is deemed to
have come to the knowledge of the parties on the very day it is entered.[27]
It is further argued by petitioners that the Sandiganbayans finding that the settlement
between petitioners and respondent was attended by fraud has no factual or legal
basis. Petitioners point out that the property values cited by respondent in its Motion
to Rescind were based solely on the estimates of the PCGG lawyers and no evidence
of the valuation of the properties were presented before the Sandiganbayan to
establish fraud. They also contend that the Sandiganbayan had no legal basis for
taking judicial notice of the fact that agricultural land in rural areas such as Famy and
Pangil, Laguna is much cheaper and is usually sold by the hectare, while land in
Metro Manila and in nearby municipalities such as Muntinlupa is more valuable and
sold per square meter. Petitioners insist that knowledge of the valuation of property
is not a condition sine qua non for the validity of a compromise agreement.[28]
Petitioners also assert that the Sandiganbayan did not have jurisdiction to annul the
Compromise Agreement because its July 31, 1998 Decision had already become
final and executory. Moreover, as a contract validly entered into by the parties, the
Compromise Agreement had binding effect and authority on the parties thereto even
if it were not judicially approved.[29]
Petitioners likewise contend that the Sandiganbayan cannot alter the Compromise
Agreement which is a valid and binding contract between themselves and respondent
and impose the additional requirement that the moneys, properties or assets involved
in the compromise must be fully disclosed and described not only as to the number
or area (in case of real properties) but also as to their exact location, classification,
appraised and fair market value, liens and encumbrances, whether titled or not, etc.,
so as to leave no room for doubt that all the parties, the Court and the public know
exactly what each party is giving or taking away, and under what specific terms and
conditions.[30] According to them, the imposition of this requirement would be
beyond the scope of the Sandiganbayans authority.[31]
Lastly, petitioners argue that the Compromise Agreement can no longer be rescinded
because it had already been implemented. In support of this argument, petitioners

claim that on September 22, 1997, or four days after the signing of the agreement,
they delivered to the PCGG the original TCTs of the properties ceded to respondent
under the agreement.[32]
Respondent, through the OSG, contends that the Sandiganbayans April 11, 2000
Resolution which granted the motion to rescind the Compromise Agreement and set
aside its July 31, 1998 Decision cannot be the proper subject of a Petition for
Certiorari. According to respondent, petitioners were not without any other remedy
from the adverse ruling of the Sandiganbayan, and they should have gone to trial and
reiterated their special defenses.[33]
Respondent also maintains that the Sandiganbayan did not err in denying petitioners
motion for voluntary inhibition of its members because petitioners allegations of
partiality and bias were not supported by clear and convincing evidence.[34]
It is also argued by respondent that there is no rule or law requiring that pleadings or
motions filed by lawyers of the government or the PCGG must first be approved by
the PCGG En Banc and by the President of the Republic.[35]
Anent the alleged procedural infirmities in the filing of the Motion to Rescind,
respondent asserts that it complied with the reglementary period for the filing of a
petition for relief from judgment under Rule 38 and that it is not an initiatory
pleading which is required to be accompanied by a Certification against ForumShopping.[36]
Respondent disagrees with the contention of petitioners that the Sandiganbayan
already lost jurisdiction over the case when it rendered its Decision on the
Compromise Agreement on July 31, 1998 considering that the decision is
immediately executory since there is no appeal from such judgment. According to
respondent, the Rules of Court does recognize the jurisdiction of the court which
rendered a decision over a petition for relief from the same decision, and does not
distinguish whether the judgment is based on the evidence presented or on a
compromise agreement. Moreover, as an exception to the general rule that the court
which rendered judgment on the compromise cannot modify such compromise, the
court may order modifications thereon when the parties consent to such modification
or when there is a hearing to determine the presence or absence of vitiated consent.
[37]
Respondent adds that the Sandiganbayan did not make a new contract for the parties
but simply declared their Compromise Agreement null and void with the net effect of
continuing the case from where it left off.[38]
Respondent insists that a compromise agreement which is unconscionable, shocking
to the mind and contrary to law and public policy, such as that entered into by it with

126

petitioners, is null and void. A void compromise agreement vests no rights and
creates no obligations. Considering that the compromise agreement sought to be
declared void in this case is one which is prejudicial to the government, it is the
Courts duty to strike it down as null and void.[39]
It is argued by respondent that while it did not present additional evidence after it
filed the Motion to Rescind, it submitted the motion on the basis of all the verified
pleadings and papers on record. Respondent likewise claims that the Sandiganbayan
did not err in taking judicial notice of the fact that agricultural lands in the provinces,
such as the lands titled in petitioners names in Famy and Pangil, Laguna, are much
cheaper than lands in urban areas such as those in Muntinlupa City. Respondent
insists that such fact is a matter of public knowledge and may be taken judicial notice
of under Section 1, Rule 129 of the Revised Rules of Court.[40]
Respondent also points out that petitioners expressly admitted in their Answer to the
Motion to Rescind that the value of the properties which they ceded to respondent
under the Compromise Agreement is less than the value of the properties retained by
them.[41]
Respondent claims that there was fraud of an extrinsic character because its
representatives in the PCGG connived with petitioners in concealing the assessed or
market values of the properties subject of the Compromise Agreement to make it
appear that the latter adhered to the 75%-25% ratio adopted by the PCGG in entering
into compromise of cases involving the recovery of ill-gotten wealth. It is pointed
out by respondent that the OSG was in fact initially reluctant to file the motion for
approval of the compromise agreement with the Sandiganbayan because the
Compromise Agreement only mentioned the areas of the properties but
conspicuously failed to mention the property values thereof. Respondent explained:
On October 7, 1997, the PCGG forwarded to the OSG a copy of the Compromise
Agreement between the Republic and the Arganas in SB Civil Case No. 0026, with a
request that the OSG file a motion with the Sandiganbayan for the approval of the
said Compromise Agreement. On November 7, 1997, in reply to the letter of PCGG,
the OSG with then Solicitor General Silvestre H. Bello III as signatory, wrote the
PCGG requesting it to submit to the OSG clarification on the provision in the
compromise agreement that the properties mentioned therein comprise all the
sequestered assets subject of the litigation considering that in the petition filed by the
Republic, it is alleged that the late mayor Argana acquired no less than 251
OCTs/TCTs in Muntinlupa and the neighboring towns plus some other ill-gotten
properties. The OSG likewise opined that the Compromise Agreement must first be
submitted to the President for his approval before submitting it to the
Sandiganbayan.

On February 10, 1998, the OSG received a reply from the PCGG, through
Commissioner Herminio Mendoza, reiterating that the PCGG has decided to enter
into the compromise agreement because it believes that the evidence may not be
sufficient to warrant continuing prosecution of Civil Case No. 0026 against the
Arganas.
With respect to OSGs request for clarification, the PCGG furnished the OSG a copy
of the report conducted by the PCGG Research and Development Department
whereby it is stated that there are 324 OCTs/TCTs evaluated representing real
properties of the late Mayor Argana with a total land area of 481.77422 hectares out
of which the Republic will get 361.9203 hectares or 75.12% of the total land area
under the Compromise Agreement. No mention, however, was made as to the value
of the properties to be ceded to the Republic and the properties to be retained by the
Arganas.
On March 2, 1998, the OSG, through then Solicitor General Romeo C. dela Cruz,
again wrote the PCGG reiterating its previous position that before submitting the
compromise agreement to the Sandiganbayan for approval, it must first be submitted
to the President of the Philippines for his approval as required in par. 6 of the
Compromise Agreement. The OSG also reiterated its request for clarification
regarding the properties covered by the compromise agreement as the Report
submitted to it made mention of 361.9203 hectares or 75.12% out of the total land
area of 481.71422 hectares to be ceded to the Republic, and 24.88% to be retained by
the Arganas, no mention whatsoever was made of the kind of land, location and
value of the respective areas.
On June 2, 1998, the OSG received a letter dated May 29,1998 from then
Commissioner Herminio A. Mendoza forwarding it copy of the approval by then
President Fidel Ramos of the Compromise Agreement. With respect to its query, it
was stated therein that the PCGG is unable to determine the value of the land to be
ceded to the Republic and those to be retained by the Arganas because of the big
number of the parcels of the land located mainly in Muntinlupa, Metro Manila and
Laguna and/or the lack of available records showing their respective values for tax
purposes. The PCGG reiterated their request that the OSG file with the
Sandiganbayan in SB Civil Case No. 0026 a motion for the approval of the
compromise agreement.
Obviously, through such a scheme, those in the PCGG then who handled or were
involved with the case fraudulently gave the Compromise Agreement a semblance of
fairness and official acceptability, but in truth, it was grossly disadvantageous to the
government. The motion to approve compromise agreement was filed by the OSG
out of courtesy as the PCGG was able to get the approval of then Pres. Fidel V.
Ramos but not because it (OSG) totally approved the same after an independent
evaluation of the report. [42] (Emphasis in the original.)

127

Finally, respondent argues that the Compromise Agreement had not yet been
implemented. Although petitioners delivered the TCTs covering the lots ceded to
respondent under the terms of the compromise on September 22, 1997, such delivery
could not have the effect of implementation of the Compromise Agreement because
the contract was submitted to the Sandiganbayan for approval only on June 15, 1998.
The Compromise Agreement expressly required that in order for it to be effective, it
must be approved by the President of the Republic and of the Sandiganbayan.[43]
The issues for the Courts resolution are as follows:
1) Whether a petition for certiorari is the proper remedy;
2) Whether the OSG and the PCGG lawyers have authority to file the Motion to
Rescind on behalf of respondent;
3) Whether the Motion to Rescind, which was treated by the Sandiganbayan as a
petition for relief, complied with the requirements of Rule 38 of the 1997 Rules of
Civil Procedure;
4) Whether the Sandiganbayan acted with grave abuse of discretion in granting the
Motion to Rescind and in setting aside its Decision dated July 31, 1998; and
5) Whether the members of the Sandiganbayans Third Division should have
inhibited themselves from resolving petitioners Motion for Reconsideration.
The Court shall first tackle the first, second, third and fifth issues since these involve
procedural matters.
The Court does not agree with respondents contention that a petition for certiorari is
not the proper remedy to assail the February 22, 2001 Order of the Sandiganbayan
which affirmed its earlier directive to set the case against petitioners for pre-trial
following the annulment of its judgment by compromise agreement. A special civil
action for certiorari may be instituted when any tribunal, board or officer exercising
judicial or quasi-judicial functions has acted without or in excess of jurisdiction, or
with grave abuse of discretion amounting to lack or excess of jurisdiction, and there
is no appeal, nor any plain, speedy and adequate remedy in the ordinary course of
law.[44] The Court has previously held that an order setting the case for further
proceedings, issued after the original judgment rendered pursuant to a compromise
agreement is set aside, is an interlocutory order and is therefore not appealable.[45]
Since no appeal is available against such an order, the proper remedy to assail it is a
special civil action for certiorari. The remedy taken by petitioners is therefore proper.

Petitioners contention that the Motion to Rescind filed by the lawyers of the PCGG
and of the OSG should have been treated by the Sandiganbayan as a mere scrap of
paper because the motion was filed without the authority of the PCGG En Banc and
of the President of the Republic has no legal basis. There is no requirement under the
law that pleadings and motions filed by lawyers of the government or the PCGG
must first be approved by the PCGG En Banc and by the President of the
Philippines. More importantly, R.A. No. 1379 expressly authorizes the OSG to
prosecute cases of forfeiture of property unlawfully acquired by any public officer or
employee.[46] It must be remembered that it was the OSG which filed Civil Case
No. 0026 for the forfeiture of petitioners allegedly ill-gotten wealth, and that the
Compromise Agreement between petitioners and respondent was an amicable
settlement of that case. By filing an action for rescission of the Compromise
Agreement based on extrinsic fraud, the OSG was merely performing its legal duty
to recover the wealth purportedly amassed unlawfully by the late Mayor Argana
during his terms as Mayor of Muntinlupa. The Motion to Rescind was filed precisely
because the PCGG, as respondents authorized representative in the compromise,
discovered that the execution of the Compromise Agreement was attended by fraud
and sought the help of the OSG which in turn is the duly authorized government
agency to represent respondent in forfeiture cases under R.A. No. 1379. Hence, the
Sandiganbayan correctly upheld the authority of the OSG, assisted by the PCGG, in
filing the Motion to Rescind.
The Court also finds that there was no grave abuse of discretion on the part of the
Sandiganbayan in granting the Motion to Rescind, which it treated as a petition for
relief from judgment under Rule 38 of the 1997 Rules on Civil Procedure. Section 3
thereof prescribes the periods within which the petition for relief must be filed:
Time for filing petition; contents and verification. A petition provided for in either of
the preceding sections of this Rule must be verified, filed within sixty (60) days after
the petitioner learns of the judgment, final order or other proceeding to be set aside,
and not more than six (6) months after such judgment or final order was entered, or
such proceeding was taken, and must be accompanied with affidavits showing the
fraud, accident, mistake or excusable negligence relied upon, and the facts
constituting the petitioners good and substantial cause of action or defense, as the
case may be.
The Court has previously held that as applied to a judgment based on compromise,
both the sixty (60)-day and six (6)-month reglementary periods within which to file a
petition for relief should be reckoned from the date when the decision approving the
compromise agreement was rendered because such judgment is considered
immediately executory and entered on the date that it was approved by the court.[47]
Applying the foregoing rule to the present case, the sixty (60)-day period should be
counted from July 31, 1998, the date of the Sandiganbayan Decision granting the

128

Motion to Approve Compromise Agreement. The sixtieth day from July 31, 1998 is
September 29, 1998. The Motion to Rescind was filed by the OSG only on October
5, 1998, clearly several days after the sixtieth day from the rendition of the July 31,
1998 Decision.
This notwithstanding, the Court finds that no grave abuse can be ascribed to the
Sandiganbayan in admitting the Motion to Rescind as a petition for relief was timely
filed.
Although as a general rule, the party filing a petition for relief must strictly comply
with the sixty (60)-day and six (6)-month reglementary periods under Section 3, Rule
38,[48] it is not without exceptions. The Court relaxed the rule in several cases[49]
and held that the filing of a petition for relief beyond the sixty 60-day period is not
fatal so long as it is filed within the six (6)-month period from entry of judgment.[50]
The Court notes that the filing of the Motion to Rescind on October 5, 1998 was
indeed seven days beyond the sixty 60-day period but still well within the six (6)month period from entry of judgment. Moreover, the case involves an alleged fraud
committed against the Republic, and thus justifies the liberal interpretation of
procedural laws by the Sandiganbayan.
Petitioners claim that respondent failed to attach an affidavit of merit to its Motion to
Rescind is belied by the record of the case. Petitioners in fact attached, as Annex N
of their Petition for Certiorari, a copy of the respondents Motion to Rescind. The
Affidavit of Merit signed by Dennis M. Taningco, the counsel of the PCGG in Civil
Case No. 0026, was attached to the Motion to Rescind. In any case, the Court in
Mago v. Court of Appeals[51] held that the absence of an affidavit of merit does not
always result in the denial of the petition for relief, so long as the facts required to be
set out in the affidavit appear in the verified petition. The oath which forms part of
the petition elevates it to the same category as an affidavit.[52]
Neither was it necessary for respondent to attach a Certification against ForumShopping to the Motion to Rescind. As correctly held by the Sandiganbayan, the
Motion to Rescind, which in effect was a petition for relief, is not an initiatory
pleading which requires the inclusion of a Certification against Forum-Shopping.
Section 2, Rule 38 requires that a petition for relief must be filed with the court
which rendered the judgment or order sought to be set aside, and in the same case
wherein the judgment or order was rendered. If the court finds that the allegations in
the petition for relief are true, it shall set aside the judgment and try the principal
case upon the merits as if a timely motion for new trial had been granted.[53]
Clearly, then, a petition for relief is not an initiatory pleading in a new case which
would require the filing by the petitioner therein of a Certification of Non- Forum
Shopping.

The Court also finds no abuse of discretion by the Sandiganbayan in denying


petitioners Urgent Motion for Voluntary Inhibition. As explained in Gutang v. Court
of Appeals,[54] the import of the rule on voluntary inhibition is that the decision of a
judge on whether or not to inhibit is left to his or her sound discretion and
conscience, based on his or her rational and logical assessment of the case where the
motion for inhibition is filed. It implies that in addition to pecuniary interest,
relationship, or previous participation in the matter under litigationwhich are grounds
for mandatory inhibition under the first paragraph of Section 1, Rule 137 of the
Revised Rules of Courtthere might be other causes that could diminish the
objectivity of the judge, thus warranting his or her inhibition. Petitioners claim of
bias and partiality on the part of the Sandiganbayan justices who issued the April 11,
2000 Resolution, evaluated in light of the resolution itself, is evidently more
imagined than real. To say, as is petitioners wont, that a judge who throws out a
partys motion in the language employed by the Sandiganbayan in the questioned
Resolution is necessarily prejudiced, is to be indiscriminate and precipitate.
Petitioners assertion that the April 11, 2000 Resolution was harshly worded and
evinced prejudgment of the case in respondents favor is easily disproved by a
reading of the Resolution in its entirety. As will be discussed hereafter, the
Sandiganbayans pronouncement that the Compromise Agreement was grossly
disadvantageous and prejudicial to the government is supported by the facts on
record. In charging the Sandiganbayan with forejudgment when it said that all it
takes to prove the case is evidence that the properties are manifestly out of
proportion to the late Mayor Maximino A. Arganas salary and to his other lawful
income and other legitimately acquired income,[55] petitioners have taken the
statement out of context. The Sandiganbayan made the statement in relation to its
bewilderment as to why the PCGG expressed difficulty in prosecuting the case
against the late Mayor Argana in spite of the presumption regarding unexplained
wealth in Section 8 of R.A. No. 3019 (the Anti-Graft and Corrupt Practices Act). The
Sandiganbayan therefore had legal and factual grounds to deny petitioners motion for
inhibition.
Anent the propriety of the Sandiganbayans nullification of the Compromise
Agreement on the ground of extrinsic fraud, the Court holds that no error nor grave
abuse of discretion can be ascribed to the Sandiganbayan for ruling that the
execution of the Compromise Agreement was tainted with fraud on the part of
petitioners and in connivance with some PCGG officials. A circumspect review of
the record of the case reveals that fraud, indeed, was perpetuated upon respondent in
the execution of the Compromise Agreement, the assessed or market values of the
properties offered for settlement having been concealed from the reviewing
authorities such as the PCGG En Banc and even the President of the Republic. The
discussion of the Sandiganbayan on the nature and extent of the fraud perpetuated
upon respondent in the execution of the Compromise Agreement is clear and
convincing:

129

Noticeable from the documents submitted to the court after the decision approving
the Compromise Agreement was promulgated is the fact that only the percentage of
sharing based on area was mentioned and brought to the attention of the PCGG en
banc and the Solicitor General. The value of the properties was never, and not even
once, mentioned. Thus, in the Memorandum of Director Mauro J. Estrada of the
PCGG Research and Development Department to the PCGG Chairman, dated
August 18, 1997, the following exposition appears:

be able to acquire about 361.9203 hectares of land equivalent to 75.12% of the


481.7742 hectares of land of sequestered real estate property belonging to the
Arganas and other owners.
However, of the 481.7742 hectares covered by a sequestration order, the late Mayor
Argana owns about 409.50817 hectares and possibly the heirs are willing to cede
361.9203 hectares which is equivalent to 88.38%, retaining 47.5887 hectares or
11.62% of what they owned.

12. On July 10, 1996, the Arganas submitted a proposal for Compromise Agreement
(copy attached, per Annex J) that would cede by donation about 231 hectares of
agricultural lands to the government, Xerox copies of nine (9) TCTs attached
therewith, enumerated as follows:

E. EVALUATION

TCT No. Area in Square Meters Location

Total Area Sequestered

1) As presented in Annex L, page 13, the total area of real estate property sequestered
aggregated to 481.7742 hectares accounted as follows:

T-3813 47,908 Famy, Laguna


T-8314 47,461 -do-

100.00%

T-8315 30,000 -do-

481.77422

T-8316 40,000 -do-

Accounted as Follows:

T-8317 30,000 -doT-4104 20,000 -doT-4106 38,550 -doT-4108 31,618 -do-

a) owned by Mayor Maximino Argana

T-4044 1,137,361 San Isidro & Banilan,


883,355 Pangil, Laguna
2,306,253 Sq. Meters

75.12%

230,6253 Hectares
Another big tract of land located at Matikiw, Pangil, Laguna, consisting of 131,2950
hectares covered by TCT No. T-4009, per Annex K may be considered for inclusion
in the proposed compromise settlement. The reason for this is that this land is being
eyed by the DAR for distribution under the CARP. As a whole, the government may

409.50817 has.
b) Owned by his Brothers & Sisters

130

9.88%

26.6318 has.
c) Foreclosed by Los Baos Rural Bank

1.24%

5.9856 has.
d) Owned by Other Persons

2) Out of the total area of 481.77422 hectares covered by a sequestration order, about
409.50817 hectares are owned by the late Mayor Argana. The other lots are owned
by his brothers and sisters (26.6318 hectares), foreclosed by Los Baos Rural Bank
(5.9856 hectares), and registered and/or acquired by other persons (39.64865
hectares). In the event that the other big area consisting of 131.2950 hectares of land
is included in the compromise settlement in favor of the government, a total of 36150817 (sic) hectares of land would comprise about 88.38 % of the 409.50817
hectares registered in the name of the late Mayor Argana.
3) However, as a whole the 361.9203 hectares to be ceded to the government is
equivalent to 75.12% of the 481.77422 hectares sequestered by PCGG as presented
above. Since the late mayor owns 409.50817 hectares to the government, the
percentage share of the government would be 88.38 % and the remaining 11.62 %
may be retained by the heirs of the late Mayor Argana, equivalent to 47.58787
hectares.
F. SUMMARY
The family of the late Mayor Maximino A. Argana offered to cede to the government
a total of 230.62553 hectares of land covered by nine (9) TCTs. Another property,
however, consisting of 131.2950 hectares may be considered for inclusion which
would increase to 361.9203 hectares of land that may be ceded to the government.
In the event that the 361.9203 hectares are finally considered and acceptable by both
parties, the PCGG and the Arganas, the 481.77422 hectares of sequestered property
would be accounted as follows:
Total Area Sequestered

8.23%
100.00%
481.77422 has.
39.64865 has.

Accounted as follows:

TOTAL
100.00%
481.77422 has.
a) To be ceded the Government

131

e) Owned by Other Persons


75.12%
8.23%
361.9203 has.
39.64865 has.
b) To be retained by the late Mayor Arganas Heirs
Total
100.00%
9.88%
481.77422 has.

47.78787 has.
c) Owned by his Brothers & Sisters

However, since the late Mayor Argana owns 409.50817 hectares sequestered and
may possibly cede 361.9203 hectares, the percentage share of the government would
be 88.38% of the 409.50817 hectares actually registered in his name and his
children.
G. RECOMMENDATION

d) Foreclosed by Los Baos Rural Bank

The PCGG wanted to recover as much as it could and as fast as possible, while the
Arganas wanted to buy peace without admitting guilt. In order to avoid further
lengthy litigation and to put an end to an almost ten-year unresolved sequestration
issue, and to expedite recovery so that the remaining assets may be used to contribute
to the national recovery, the 230.6253 hectares of land covered by nine (9) TCTs
(Nos. T-3813, T-3814, T-3815, T-3816, T-3817, T-4104, T-4106, T-4108 and T-4044)
offered by the Arganas be favorably considered, on condition that another real estate
property covered by TCT No. T-4009, located at Matikiw, Pangil, Laguna, consisting
of 131.2950 hectares, be included and to be ceded to the government. All other lots
sequestered should be freed from the sequestration order.

1.24%

As a whole, the government stands to acquire about 361.9203 hectares out of the
409.50817 hectares registered in the name of Sps. Maximino A. Argana, REFEDOR,
and their children, equivalent to 88.38%. The remaining 11.62% or 47.58787
hectares will be retained by the latter.

5.53%

26.6318 has.

For the consideration of the Commission.


Signed
5.9856 has.

MAURO J. ESTRADA

132

(Underlining supplied)

. . . What was projected to be a 75%-25% ratio was in reality a 00.15%-99.85% ratio,


with 99.85% going to the Arganas. This is unconscionable and immoral. And since it
results in a transaction grossly disadvantageous and immoral to the government, it is
against the law as being violative of Section 3(g) of Republic Act 3019.

....

...

The value of the properties must have been raised or even discussed during the
several years that the properties were held under sequestration. Yet, not even the
PCGG bothered to produce any tax declaration, assessment or appraisal to show the
assessed or fair market value of the properties. . . . .

In the instant case, fraud of an extrinsic character exists because the representatives
of plaintiff Republic in the PCGG connived with defendants in hiding the assessed or
market values of the properties involved, so as to make it appear that the
Compromise Agreement adhered to the 75%-25% ratio adopted by the PCGG in
entering into compromise of cases involving the recovery of ill-gotten wealth.
Through their infidelity, those in the PCGG who handled or were closely involved
with the case during the last days of the previous administration fraudulently gave
the Compromise Agreement a semblance of fairness and official acceptability. They
sold plaintiff Republic down the river by entering into an agreement grossly
disadvantageous to the government. For while plaintiff Republic got 00.15%
(00.15074) of the estimated value of all the properties involved in this case,
defendants almost ran away with 99.85% (99.84526) of their value. This is patently
unfair. It is no compromise but a virtual sell-out. It could not have been pulled off
without the connivance or collusion of those responsible for the case in the PCGG.
Instead of protecting the interest of the government, they connived at its
defeatalmost.[56] (Emphasis in the original.)

(Record, v. 6, pp. 776-78)

Again in another Memorandum of Director Mauro J. Estrada to PCGG Counsel


Edgardo L. Kilayko, dated February 2, 1988, the properties were listed according to
the name of the owner, certificate of title, area in square meters, location and
percentages in relation to the whole. Obvious from the listing is the absence of a
column to indicate the value of the properties or their classification. . . .
The percentage based solely on area, was clearly emphasized, as shown by the
following portions of said Memorandum:
Out of the 409.50817 hectares registered in the name of Spouses Maximo A. Argana
and Donata A. Argana as presented above, 361.9203 hectares covering eleven (11)
TCTs are to be ceded to the government under the compromise agreement signed by
Argana and the Commission in the latter part of 1997. The 361.9203 hectares to be
ceded to the government is equivalent to 75.12 % of the total area of 481.77422
hectares, as presented below: x x x (Record, v. 6, p. 1739) (underlining supplied)
As a whole, there are 324 TCTs/OCTs covering a total area of 481.77422 hectares,
out of which the heirs of the late Mayor agreed to cede 361.9203 hectares equivalent
to 75.12 % of the total area. Sometime. In August 1997, the Commission agreed to
accept the offer by concluding a compromise agreement with the heirs of the late
Mayor. (Record, v. 6, p. 1739) (underlining supplied)
....
. . . The values were deliberately omitted to make it appear that the Compromise
Agreement adheres to the 75%-25% ratio broadly adopted by the PCGG in
compromising cases of ill-gotten wealth. It was this 75%-25% mode of compromise,
with the greater share of 75% going to the government that misled the Court to
believe, as We did believe, that the Compromise Agreement was fair, reasonable and
advantageous to the Government. . . .

It is evident from the foregoing that the ruling of the Sandiganbayan is grounded on
facts and on the law. The Court sees no reason to depart from the conclusions drawn
by the Sandiganbayan on the basis of its findings, especially considering that the
three justices comprising the Sandiganbayans Third Division conducted a thorough
examination of the documents submitted by the parties to this case, heard the
testimonies of the parties witnesses and observed their deportment during the hearing
on the Motion to Rescind.
Moreover, it is an established rule that the State cannot be estopped by the mistakes
of its agents.[57] Respondent cannot be bound by a manifestly unjust compromise
agreement reviewed on its behalf and entered into by its representatives from the
PCGG who apparently were not looking after respondents best interests.
WHEREFORE, the petition is DISMISSED for lack of merit. The Resolution dated
April 11, 2000 of the Sandiganbayan granting the Motion to Rescind Compromise
Agreement and to Set Aside Judgment by Compromise and setting the case for pretrial, as well as the Order dated February 22, 2001 denying petitioners motion for
reconsideration, are hereby AFFIRMED.
Costs against petitioners.

133

SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 169604

March 6, 2007

NELSON P. COLLANTES, Petitioner,


vs.
HON. COURT OF APPEALS, CIVIL SERVICE COMMISSION and
DEPARTMENT OF NATIONAL DEFENSE, Respondents.
DECISION
CHICO-NAZARIO, J.:
A decision that has acquired finality becomes immutable and unalterable. A final
judgment may no longer be modified in any respect, even if the modification is
meant to correct erroneous conclusions of fact and law; and whether it be made by
the court that rendered it or by the highest court in the land.1
What would happen, however, if two separate decisions, irreconcilably conflicting
with each other, both attained finality? Quite clearly, to hold that both decisions are
immutable and unalterable would cause not only confusion and uncertainty, but utter
bewilderment upon the persons tasked to execute these judgments.
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,
seeking to set aside the Decision2 dated 10 March 2005 and the Resolution3 dated
31 August 2005 of the Court of Appeals in CA-G.R. SP No. 78092.
The undisputed facts of this case are summarized by the Court of Appeals:
Petitioner Nelson Collantes (hereafter, Collantes) was conferred Career Executive
Service Eligibility on 29 February 1996. Then President Fidel V. Ramos accorded
him the rank of Career Executive Service Officer (CESO) II on 10 February 1997.
More than a year later, he was appointed as Undersecretary for Peace and Order of
the Department of Interior and Local Government (DILG).

Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Chico-Nazario, JJ., concur.


could unreservedly appoint his key officials. As such, Collantes relinquished his post
at the DILG.
Thereafter, on 1 July 1998, President Estrada appointed Collantes to the
controversial post Undersecretary for Civilian Relations of the Department of
National Defense (DND). As it happened, his stint in the DND was short lived.
Collantes was supposedly ordered by then Secretary Orlando Mercado to renounce
his post in favor of another presidential appointee, General Orlando Soriano. In
deference to the Presidents prerogative, he resigned from office believing that he
will soon be given a new assignment.
Unfortunately, Collantes was not given any other post in the government, as in fact,
he received a letter from President Estrada terminating his services effective 8
February 1999. Consequently, on 24 March 1999, Collantes requested the assistance
of the Career Executive Service Board relative to the termination of his services as
Undersecretary for Civilian Relations of the DND invoking his right to security of
tenure as a CESO.
The termination of Collantes services, notwithstanding, President Estrada accorded
Collantes the highest rank in the CES ranking structure, CESO Rank I, on 17 July
1999. But then, despite this promotion in rank, Collantes did not receive new
appointment, and worse, the President appointed Mr. Edgardo Batenga to the much
coveted position of Undersecretary for Civilian Relations of the DND.
Taking definite action on the matter, Collantes instituted a Petition for Quo Warranto
and Mandamus before Us on 29 January 2001, docketed as C.A. G.R. SP NO. 62874.
Collantes maintained that he was constructively dismissed from work, without any
cause and due process of law, and thus, his position in the DND was never vacated at
all. Accordingly, he prayed that the appointment of Mr. Edgardo Batenga be
nullified, and that he be reinstated to his former position with full back salaries.
Notably, Collantes also sought for appointment to a position of equivalent rank
commensurate to his CESO Rank I if reinstatement to his former position is no
longer legally feasible.
Meanwhile, on 13 August 2001, the CSC favorably acted on Collantes letter-request
issuing Resolution No. 011364, and thereby holding that Collantes relief as
Undersecretary of DND amounted to illegal dismissal as he was not given another
post concomitant to his eligibility.

With the change of administration, Collantes allegedly received word from persons
close to then President Ejercito Estrada to give up his position so that the President

134

Then, on 30 August 2001, We rendered Our Decision in C.A. G.R. SP No. 62874
dismissing the Petition for Quo Warranto and Mandamus filed by Collantes.
Significantly, We pronounced:
"By such actuations of the petitioner, the Court finds that he has (sic) effectively
resigned from his position as Undersecretary of the DND, and the public respondents
are under no compulsion to reinstate him to his old position.
xxxx
"In this case, petitioner has undoubtedly shown his intention to relinquish his public
office, and has in fact surrendered such post to the Chief Executive, who, on the
other hand, has shown his acceptance of the same by appointing a new person to the
position relinquished by the petitioner.
xxxx
Quo warranto, it must be pointed out, is unavailing in the instatnt case, as the public
office in question has not been usurped, intruded into or unlawfully held by the
present occupant. Nor does the incumbent undersecretary appear to have done or
suffered an act which forfeits his assumption. (Section 1, Rule 66, 1997 Rules of
Civil Procedure). Furthermore, it appears that the action for quo warranto, assuming
it is available, has already lapsed by prescription, pursuant to Section 11 of the
pertinent Rule ...

Consequently, in complete turnabout from its previous stance, the CSC issued
Resolution No. 021482 dated 12 November 2002 declaring that had it been properly
informed that a Petition for Quo Warranto and Mandamus was then pending before
Us, it would have refrained from ruling on Collantes quandary, thus:
"WHEREFORE, the Motion for Reconsideration of Assistant Secretary for Legal
Affairs Leticia A. Gloria of the department of National Defense (DND) is hereby
GRANTED and CSC Resolutions Nos. 01-1364 dated August 13, 2001 and 02-0084
dated January 15, 2002 are reversed. Accordingly, pursuant to the decision of the
Court of Appeals, Nelson P. Collantes is deemed effectively resigned from his
position as Undersecretary of the DND."
Forthwith, Collantes moved for a reconsideration of this Resolution, but was denied
by the CSC in the second assailed Resolution No. 030542 dated 5 May 2003.4
On 18 July 2003, herein petitioner Collantes then filed a Petition for Certiorari with
the Court of Appeals praying for the reversal of the Civil Service Commission (CSC)
Resolutions No. 021482 and No. 030542. Before the Court of Appeals can decide
this case, however, petitioner was appointed as General Manager of the Philippine
Retirement Authority on 5 August 2004. The Court of Appeals dismissed the Petition
for Certiorari in the assailed 10 March 2005 Decision:

xxxx

WHEREFORE, the Petition for Certiorari is hereby DISMISSED. No grave abuse of


discretion may be imputed against the Civil Service Commission for rendering
Resolution Nos. 021482 and 030542, dated 12 November 2002 and 5 May 2003,
respectively. No pronouncement as to costs.5

WHEREFORE, premises considered, the instant petition for Quo Warranto and
Mandamus is hereby DISMISSED."

The Motion for Reconsideration filed by petitioner was denied in the assailed 31
August 2005 Resolution.6

The controversy reached the Supreme Court as G.R. No. 149883. Nevertheless, the
case was considered closed and terminated when Collantes manifested his desire not
to pursue his appeal and withdraw his Petition for Review on Certiorari. Thereafter,
Collantes moved for the execution of CSC Resolution No. 011364, which was
accordingly granted through CSC Resolution No. 020084 dated 15 January 2002
"directing the DND to give Collantes a position where his eligibility is appropriate
and to pay his backwages and other benefits from the time of his termination up to
his actual reinstatement."

Petitioner filed the present Petition for Review, seeking the reversal of the foregoing
Decision and Resolution of the Court of Appeals. In view of his 5 August 2004
appointment, however, petitioners prayer is now limited to seeking the payment of
backwages and other benefits that may have been due him from the time of his
alleged dismissal on 8 February 1999 to his appointment on 5 August 2004.
Petitioner submits the following issues for our consideration:

In a Letter dated 7 February 2002, the Legal Affairs Division of the DND, through
Atty. Leticia A. Gloria, urged the CSC to revisit its Resolutions which were entirely
in conflict with Our 30 August 2001 Decision in C.A. G.R. SP NO. 62874, which has
attained finality pursuant to the Supreme Courts Resolution in G.R. No. 149883.

WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND


REVERSIBLE ERROR WHEN IT HELD THAT THE DECISION IN CA-G.R. NO.
62874 IN THE COURT OF APPEALS IS A BAR TO IMPLEMENT THE FINAL
AND EXECUTORY JUDGMENT OF THE CIVIL SERVICE COMMISSION
DATED AUGUST 14, 2001.

A.

135

B.
WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND
REVERSIBLE ERROR WHEN IT DID NOT FIND THAT THE CIVIL SERVICE
COMMISSION COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OR EXCESS OF JURISDICTION WHEN IT REVERSED ITS VERY
OWN DECISION WHICH HAS LONG BECOME FINAL AND EXECUTORY
AND IN FLAGRANT VIOLATION OF PETITIONERS RIGHT TO DUE
PROCESS.
C.
WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND
REVERSIBLE ERROR WHEN IT UPHELD THE RESOLUTION OF THE CIVIL
SERVICE COMMISSION WHICH HELD THAT PETITIONER MAY BE
REMOVED FROM HIS POSITION AS UNDERSECRETARY OF THE
DEPARTMENT OF NATIONAL DEFENSE WITHOUT THE CONCOMITANT
TRANSFER TO A POSITION EQUIVALENT IN RANK OR BE REMOVED
THEN, BE FLOATED PERPETUALLY, WHICH IS TANTAMOUNT TO A
CONSTRUCTIVE DISMISSAL, IN VIOLATION OF HIS RIGHT TO SECURITY
OF TENURE AS A CAREER EXECUTIVE SERVICE ELIGIBLE.7
Both petitioner and herein respondents CSC and Department of National Defense
(DND) invoke the doctrine of immutability of final judgments.
Petitioner claims that the 13 August 2001 Resolution of the CSC, which held that
petitioner "was illegally removed as Undersecretary of the Department of National
Defense and therefore x x x should be given a position where his eligibility is
appropriate or sufficient," has attained finality. Petitioner adds that, not only has
there been no appeal or motion for reconsideration filed within the allowable periods,
the CSC even granted the Motion for Execution filed by petitioner in its Order dated
15 January 2002. Petitioner thereby invokes our ruling that, before a writ of
execution may issue, there must necessarily be a final judgment or order that
disposes of the action or proceeding.8 Petitioner also faults the CSC for ruling on a
mere letter filed by Atty. Leticia Gloria of the DND, which petitioner claims is
fatally defective for failure to comply with the procedural due process clause of the
Constitution, the Rules of Court, and the Uniform Rules in Administrative Cases in
the Civil Service which require notice to adverse parties.9
Respondents, on the other hand, invoke the same doctrine of immutability of final
judgments, this time with respect to the 30 August 2001 Decision of the Court of
Appeals dismissing the Petition for Quo Warranto and Mandamus filed by petitioner.
This Court of Appeals Decision became final and executory when petitioner

withdrew the Motion for Extension to File a Petition for Review on Certiorari he
filed with this Court.10
Forum Shopping, Res Judicata, and Litis Pendentia
Our rules on forum shopping are meant to prevent such eventualities as conflicting
final decisions as in the case at bar. We have ruled that what is important in
determining whether forum shopping exists or not is the vexation caused the courts
and parties-litigants by a party who asks different courts and/or administrative
agencies to rule on the same or related causes and/or grant the same or substantially
the same reliefs, in the process creating the possibility of conflicting decisions being
rendered by the different fora upon the same issues.11
More particularly, the elements of forum shopping are: (a) identity of parties or at
least such parties as represent the same interests in both actions; (b) identity of the
rights asserted and the reliefs prayed for, the relief being founded on the same facts;
and (c) the identity of the two preceding particulars, such that any judgment rendered
in the other action will, regardless of which party is successful, amount to res
judicata in the action under consideration.12
Forum shopping can be committed in three ways: (1) filing multiple cases based on
the same cause of action and with the same prayer, the previous case not having been
resolved yet (where the ground for dismissal is litis pendentia); (2) filing multiple
cases based on the same cause of action and the same prayer, the previous case
having been finally resolved (where the ground for dismissal is res judicata); and (3)
filing multiple cases based on the same cause of action but with different prayers
(splitting of causes of action, where the ground for dismissal is also either litis
pendentia or res judicata).13 If the forum shopping is not considered willful and
deliberate, the subsequent cases shall be dismissed without prejudice on one of the
two grounds mentioned above. However, if the forum shopping is willful and
deliberate, both (or all, if there are more than two) actions shall be dismissed with
prejudice.14
Petitioner disputes respondents claim, and the CSCs ruling,15 that he had lodged
two separate actions. Petitioner explains that he never filed a case before the CSC.
He merely sought the assistance of the Career Executive Service Board (CESB) in a
letter-request dated 24 March 1999. Said letter-request, petitioner claims, did not ask
for any ruling.
Petitioner claims that, considering that two years had already lapsed without any
response from the CESB, he filed on 23 January 2001 his Petition for Quo Warranto
and Mandamus with the Court of Appeals. Petitioner was surprised when he learned
through the 8 February 2001 letter of the CESB that, on 29 November 2000, it
referred petitioners request to the CSC for appropriate action.16 Petitioner was not

136

required to submit any pleading in support of his request. Apparently, the CSC
treated the letter-request as a complaint or petition over which it could exercise its
adjudicative powers, as it issued its 13 August 2001 Resolution declaring petitioner
to have been illegally removed as Undersecretary of the DND, and should therefore
be given a position appropriate or sufficient for his eligibility.17 As stated above, the
Court of Appeals Decision dismissing the Petition for Quo Warranto and Mandamus
was rendered 17 days later, on 30 August 2001. Petitioner filed with this Court a
motion for an extension of time within which to file a Petition for Review on
Certiorari, but he later submitted a Manifestation for the withdrawal of this motion as
he decided not to pursue his appeal.18 Instead, petitioner filed with the CSC on 25
October 2001 a Motion for the Issuance of a Writ of Execution,19 which the CSC
granted on 15 January 2002.20
In repeatedly asserting that he did not file two separate actions, petitioner is arguing,
without stating it categorically, that he cannot be held liable for forum shopping.
However, what one cannot do directly cannot be done indirectly. Petitioner had been
aware, through the 8 February 2001 letter of the CESB, that his request for assistance
was referred to the CSC on 29 November 2000 for appropriate action. From that
point on, he knew that two government agencies the CSC and the Court of Appeals
were simultaneously in the process of reaching their respective decisions on
whether petitioner was entitled to reinstatement or to a position appropriate to his
eligibility. Therefore, it cannot be denied that petitioner knew, from the moment of
receipt of the 8 February 2001 letter of the CESB, that he had effectively instituted
two separate cases, and whatever original intention he had for his letter-request is, by
then, forgotten. Petitioner subsequently proceeded to act like a true forum shopper
he abandoned the forum where he could not get a favorable judgment, and moved to
execute the Resolution of the forum where he succeeded.
Petitioners above actuation is, in fact, a violation of his certification against forum
shopping with the Court of Appeals, a ground for dismissal of actions distinct from
forum shopping itself. As petitioner knew from the receipt of the CESB letter that
another claim was pending in a quasi-judicial agency concerning these issues, he was
bound by his certification with the Court of Appeals to report such fact within five
days from his knowledge thereof. This circumstance of being surprised by the
discovery of another pending claim with another court or quasi-judicial agency is
the very situation contemplated by letter (c) in the first paragraph of Section 5, Rule
7 of the Rules of Court:
Section 5. Certification against forum shopping. The plaintiff or principal party
shall certify under oath in the complaint or other initiatory pleading asserting a claim
for relief, or in a sworn certification annexed thereto and simultaneously filed
therewith: (a) that he has not theretofore commenced any action or filed any claim
involving the same issues in any court, tribunal or quasi-judicial agency and, to the
best of his knowledge, no such other action or claim is pending therein; (b) if there is

such other pending action or claim, a complete statement of the present status
thereof; and (c) if he should thereafter learn that the same or similar action or claim
has been filed or is pending, he shall report that fact within five (5) days therefrom to
the court wherein his aforesaid complaint or initiatory pleading has been filed.
(Emphases supplied.)
Petitioner, however, further asserts that the issues brought in the Petition for
Certiorari filed with the Court of Appeals on 18 July 2003 and the Petition for Quo
Warranto and Mandamus filed on 29 January 2001 are distinct, and that the Decision
of the Court of Appeals in the latter cannot constitute res judicata with respect to the
former.21 Petitioner claims that the issues, remedies and reliefs in the two cases are
different, citing as basis the textbook definitions of quo warranto, certiorari and
mandamus. Petitioner further claims that:
There is a clear distinction between the right of petitioner to the position of
Undersecretary for Civilian Relations and his right to be re-appointed to another
position of equivalent rank, in view of his CESO I status. The former issue may have
been resolved by the Court of Appeals when it ruled that petitioner Collantes had
"effectively resigned from his position as Undersecretary of the DND, and the public
respondents are under no compulsion to reinstate him to his old position." The latter
issue, or the right of petitioner Collantes to be given a new assignment fitting to his
CESO I rank, arises from his right to security of tenure as a Career Executive Service
Eligible, and not from his appointment to the DND.22
This allegedly clear distinction springs from petitioners claim that he resigned from
his position, but not from his rank as a Career Executive Service Officer (CESO).
Petitioner claims that, as a CESO, there is a "great difference between (1) resigning
from ones position and (2) resigning or relinquishing ones rank, as position is
different from ones rank. POSITION refers to the particular or specific office from
which one may be appointed. RANK, on the other hand, refers not to a particular
position but to the class to which one belongs in the hierarchy of authority in an
organization or bureaucracy."23 Petitioner cites Cuevas v. Bacal24:
[S]ecurity of tenure to members of the CES does not extend to the particular
positions to which they may be appointed --- a concept which is applicable only to
the first and second-level employees in the civil service --- but to the rank to which
they are appointed by the President.
xxxx
Mobility and flexibility in the assignment of personnel, the better to cope with the
exigencies of public service, is thus the distinguishing feature of the Career
Executive Service. x x x.

137

and General v. Roco25:


In addition, it must be stressed that the security of tenure of employees in the career
executive service (except first and second-level employees in the civil service),
pertains only to rank and not to the office or to the position to which they may be
appointed. Thus, a career executive service officer may be transferred or reassigned
from one position to another without losing his rank which follows him wherever he
is transferred or reassigned. In fact, a CESO suffers no diminution of salary even if
assigned to a CES position with lower salary grade, as he is compensated according
to his CES rank and not on the basis of the position or office he occupies.
While there is indeed a distinction between position and rank, such that a CESO may
be transferred or reassigned from one position to another without losing his rank,
there can be no distinction between resigning from a position and resigning from a
rank. The rank of a CESO is deactivated upon separation from the government
service, which includes the resignation of a CESO from his position. The CESB has
clarified this concept of being in the inactive status in its Resolution No. 554, series
of 2002:
Rule II
xxxx
7. CESO in Inactive Status - is a CESO who no longer occupies a position in the
CES as a result of any of the modes of separation from the government service,
provided that such separation is not due to dismissal from the service for cause.

Sec. 2. Effect of Deactivation of CES Rank. A CESO whose CES rank has been
deactivated by the Board loses all the rights and privileges accorded to him/her by
law on account of his/her CES rank.
Likewise, it would be absurd for us to rule that a civil servant who resigns from his
position can compel the President to appoint him to another position. Such a ruling
would effectively derogate the discretion of the appointing authority,26 as it will give
the CESO the option to choose which position he or she wants, by the simple
expediency of resigning from the position he or she does not want.
In sum, there is an identity of issues in the two cases which resulted in the two
conflicting final and executory decisions. But while, as stated above, the second
petition can be dismissed on the ground of either res judicata or non-compliance with
the undertakings in petitioners certification against forum shopping, these grounds
can only be invoked when the case is still pending. As petitioner points out, the
Resolution of the CSC had already become final and executory.
The 30 August 2001 Decision of the Court of Appeals, however, has also attained
finality. Hence, we go back to the main issue in this petition: which of the two final
and executory decisions should be given effect, the 30 August 2001 Court of Appeals
Decision dismissing the petitioners Petition for Quo Warranto, or the 13 August
2001 CSC Resolution declaring petitioner Collantes to be illegally removed as
Undersecretary of the DND?
Two Conflicting Final and Executory Decisions

xxxx

Jurisprudence in the United States offers different solutions to this problem:

Rule IV

Where there have been two former actions in which the claim or demand, fact or
matter sought to be religated has been decided contrarily, the rule that, where there is
an estoppel against an estoppel, it "setteth the matter at large" has been applied by
some authorities, and in such case both parties may assert their claims anew. Other
authorities have held that, of two conflicting judgments on the same rights of the
same parties, the one which is later in time will prevail, although it has also been
held that the judgment prior in time will prevail. It has been held that a decision of a
court of last resort is binding on the parties, although afterward, in another cause, a
different principle was declared.27

Section 1. Modes of Deactivating a CES Rank. There are three (3) modes by which
the CES Rank of a CESO may be deactivated from the CES:
1. Acceptance of a position by virtue of an appointment outside the coverage of the
CES;
2. Dropping from the rolls of government officials and employees; and
3. Other modes of separation from the CES, provided that separation from the CES
resulting from dismissal from the service for cause and after due process shall result
in the loss of CES rank and shall not be considered as a mode of deactivation.

There are thus three solutions which we can adopt in resolving the case at bar: the
first is for the parties to assert their claims anew, the second is to determine which
judgment came first, and the third is to determine which of the judgments had been
rendered by a court of last resort.

xxxx

138

As there are conflicting jurisprudence on the second solution, it is appropriate for


this Court to adopt either the first or the third solution. The first solution involves
disregarding the finality of the two previous judgments and allowing the parties to
argue on the basis of the merits of the case anew. The third solution merely involves
the determination of which judgment has been rendered by this Court, the court of
last resort in this jurisdiction.
Adopting the third solution will result in the denial of this Petition for Certiorari.
Whereas the finality of the 13 August 2001 CSC Resolution came about by the
failure to file a motion for reconsideration or an appeal within the proper
reglementary periods, the finality of the 30 August 2001 Court of Appeals Decision
was by virtue of the 12 November 2001 Resolution28 of this Court which declared
the case closed and terminated upon the manifestation of petitioner that he decided
not to pursue his appeal and was thus withdrawing the motion for extension of time
to file a petition for review on certiorari.
The better solution, however, is to let the parties argue the merits of the case anew,
and decide the case on the basis thereof. We can do this either by remanding the case
to a lower court, or by resolving the issues in this disposition. The latter recourse is
more appropriate, for three reasons: (1) all the facts, arguments, and pleadings in
support of the parties contentions are now before us, with the parties advancing the
very same contentions as those in this Petition; (2) a remand to the Court of Appeals
would entail asking the latter to resolve the very same issues it had passed upon
twice; and (3) a remand to the Court of Appeals would only entail another
unnecessary delay in the termination of the case when the case is now ripe for
adjudication before us.
The merits of the case are the focus of petitioners third assignment of error in the
present petition. Petitioner claims that the Court of Appeals committed a grave and
reversible error when it upheld the resolution of the CSC which allegedly effectively
held "that petitioner may be removed from his position as Undersecretary of the
Department of National Defense without the concomitant transfer to a position
equivalent in rank or be removed then, be floated perpetually, which is tantamount to
Republic of the Philippines
SUPREME COURT
Manila

a constructive dismissal, in violation of his right to security of tenure as a career


executive service eligible."29
Petitioners arguments presuppose that he had been removed from his position as
Undersecretary of the DND. He, however, did not present any evidence to that effect,
whether in this Petition or in his earlier Petition for Quo Warranto and Mandamus
with the Court of Appeals. If he is implying that he was removed from office by
virtue of his account that he was approached by persons close to President Joseph
Estrada who asked him to relinquish his post, which he did, then this Petition must
fail, for, by his own deliberate deed, he resigned from his position.
There are no special legal effects when a resignation is one of a courtesy resignation.
The mere fact that the President, by himself or through another, requested for
someones resignation does not give the President the obligation to appoint such
person to another position. A courtesy resignation is just as effectual as any other
resignation. There can be no implied promises of another position just because the
resignation was made out of courtesy. Any express promise of another position, on
the other hand, would be void, because there can be no derogation of the discretion
of the appointing power,30 and because its object is outside the commerce of man.31
As held by the Court of Appeals in its 30 August 2001 Decision:
In the first place, petitioner has not established by any quantum of certainty the
veracity of his claim that he was promised an equivalent position in the government.
Assuming, however, that such promise was true, petitioner, as a ranking member of
the bureaucracy, ought to have known that such promise offers no assurance in law
that the same would be complied with. The time-honored rule is that public office is
a public trust, and as such, the same is governed by law, and cannot be made the
subject of personal promises or negotiations by private persons.32
WHEREFORE, the present Petition for Review on Certiorari is DENIED. No costs.
SO ORDERED
HON. COURT OF APPEALS, CIVIL SERVICE COMMISSION and
DEPARTMENT OF NATIONAL DEFENSE, Respondents.
DECISION

EN BANC
CHICO-NAZARIO, J.:
G.R. No. 169604

March 6, 2007

NELSON P. COLLANTES, Petitioner,


vs.

A decision that has acquired finality becomes immutable and unalterable. A final
judgment may no longer be modified in any respect, even if the modification is
meant to correct erroneous conclusions of fact and law; and whether it be made by
the court that rendered it or by the highest court in the land.1

139

What would happen, however, if two separate decisions, irreconcilably conflicting


with each other, both attained finality? Quite clearly, to hold that both decisions are
immutable and unalterable would cause not only confusion and uncertainty, but utter
bewilderment upon the persons tasked to execute these judgments.
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,
seeking to set aside the Decision2 dated 10 March 2005 and the Resolution3 dated
31 August 2005 of the Court of Appeals in CA-G.R. SP No. 78092.

Taking definite action on the matter, Collantes instituted a Petition for Quo Warranto
and Mandamus before Us on 29 January 2001, docketed as C.A. G.R. SP NO. 62874.
Collantes maintained that he was constructively dismissed from work, without any
cause and due process of law, and thus, his position in the DND was never vacated at
all. Accordingly, he prayed that the appointment of Mr. Edgardo Batenga be
nullified, and that he be reinstated to his former position with full back salaries.
Notably, Collantes also sought for appointment to a position of equivalent rank
commensurate to his CESO Rank I if reinstatement to his former position is no
longer legally feasible.

The undisputed facts of this case are summarized by the Court of Appeals:
Petitioner Nelson Collantes (hereafter, Collantes) was conferred Career Executive
Service Eligibility on 29 February 1996. Then President Fidel V. Ramos accorded
him the rank of Career Executive Service Officer (CESO) II on 10 February 1997.
More than a year later, he was appointed as Undersecretary for Peace and Order of
the Department of Interior and Local Government (DILG).
With the change of administration, Collantes allegedly received word from persons
close to then President Ejercito Estrada to give up his position so that the President
could unreservedly appoint his key officials. As such, Collantes relinquished his post
at the DILG.
Thereafter, on 1 July 1998, President Estrada appointed Collantes to the
controversial post Undersecretary for Civilian Relations of the Department of
National Defense (DND). As it happened, his stint in the DND was short lived.
Collantes was supposedly ordered by then Secretary Orlando Mercado to renounce
his post in favor of another presidential appointee, General Orlando Soriano. In
deference to the Presidents prerogative, he resigned from office believing that he
will soon be given a new assignment.

Meanwhile, on 13 August 2001, the CSC favorably acted on Collantes letter-request


issuing Resolution No. 011364, and thereby holding that Collantes relief as
Undersecretary of DND amounted to illegal dismissal as he was not given another
post concomitant to his eligibility.
Then, on 30 August 2001, We rendered Our Decision in C.A. G.R. SP No. 62874
dismissing the Petition for Quo Warranto and Mandamus filed by Collantes.
Significantly, We pronounced:
"By such actuations of the petitioner, the Court finds that he has (sic) effectively
resigned from his position as Undersecretary of the DND, and the public respondents
are under no compulsion to reinstate him to his old position.
xxxx
"In this case, petitioner has undoubtedly shown his intention to relinquish his public
office, and has in fact surrendered such post to the Chief Executive, who, on the
other hand, has shown his acceptance of the same by appointing a new person to the
position relinquished by the petitioner.
xxxx

Unfortunately, Collantes was not given any other post in the government, as in fact,
he received a letter from President Estrada terminating his services effective 8
February 1999. Consequently, on 24 March 1999, Collantes requested the assistance
of the Career Executive Service Board relative to the termination of his services as
Undersecretary for Civilian Relations of the DND invoking his right to security of
tenure as a CESO.
The termination of Collantes services, notwithstanding, President Estrada accorded
Collantes the highest rank in the CES ranking structure, CESO Rank I, on 17 July
1999. But then, despite this promotion in rank, Collantes did not receive new
appointment, and worse, the President appointed Mr. Edgardo Batenga to the much
coveted position of Undersecretary for Civilian Relations of the DND.

Quo warranto, it must be pointed out, is unavailing in the instatnt case, as the public
office in question has not been usurped, intruded into or unlawfully held by the
present occupant. Nor does the incumbent undersecretary appear to have done or
suffered an act which forfeits his assumption. (Section 1, Rule 66, 1997 Rules of
Civil Procedure). Furthermore, it appears that the action for quo warranto, assuming
it is available, has already lapsed by prescription, pursuant to Section 11 of the
pertinent Rule ...
xxxx

140

WHEREFORE, premises considered, the instant petition for Quo Warranto and
Mandamus is hereby DISMISSED."

The Motion for Reconsideration filed by petitioner was denied in the assailed 31
August 2005 Resolution.6

The controversy reached the Supreme Court as G.R. No. 149883. Nevertheless, the
case was considered closed and terminated when Collantes manifested his desire not
to pursue his appeal and withdraw his Petition for Review on Certiorari. Thereafter,
Collantes moved for the execution of CSC Resolution No. 011364, which was
accordingly granted through CSC Resolution No. 020084 dated 15 January 2002
"directing the DND to give Collantes a position where his eligibility is appropriate
and to pay his backwages and other benefits from the time of his termination up to
his actual reinstatement."

Petitioner filed the present Petition for Review, seeking the reversal of the foregoing
Decision and Resolution of the Court of Appeals. In view of his 5 August 2004
appointment, however, petitioners prayer is now limited to seeking the payment of
backwages and other benefits that may have been due him from the time of his
alleged dismissal on 8 February 1999 to his appointment on 5 August 2004.
Petitioner submits the following issues for our consideration:

In a Letter dated 7 February 2002, the Legal Affairs Division of the DND, through
Atty. Leticia A. Gloria, urged the CSC to revisit its Resolutions which were entirely
in conflict with Our 30 August 2001 Decision in C.A. G.R. SP NO. 62874, which has
attained finality pursuant to the Supreme Courts Resolution in G.R. No. 149883.

WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND


REVERSIBLE ERROR WHEN IT HELD THAT THE DECISION IN CA-G.R. NO.
62874 IN THE COURT OF APPEALS IS A BAR TO IMPLEMENT THE FINAL
AND EXECUTORY JUDGMENT OF THE CIVIL SERVICE COMMISSION
DATED AUGUST 14, 2001.

Consequently, in complete turnabout from its previous stance, the CSC issued
Resolution No. 021482 dated 12 November 2002 declaring that had it been properly
informed that a Petition for Quo Warranto and Mandamus was then pending before
Us, it would have refrained from ruling on Collantes quandary, thus:
"WHEREFORE, the Motion for Reconsideration of Assistant Secretary for Legal
Affairs Leticia A. Gloria of the department of National Defense (DND) is hereby
GRANTED and CSC Resolutions Nos. 01-1364 dated August 13, 2001 and 02-0084
dated January 15, 2002 are reversed. Accordingly, pursuant to the decision of the
Court of Appeals, Nelson P. Collantes is deemed effectively resigned from his
position as Undersecretary of the DND."

A.

B.
WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND
REVERSIBLE ERROR WHEN IT DID NOT FIND THAT THE CIVIL SERVICE
COMMISSION COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OR EXCESS OF JURISDICTION WHEN IT REVERSED ITS VERY
OWN DECISION WHICH HAS LONG BECOME FINAL AND EXECUTORY
AND IN FLAGRANT VIOLATION OF PETITIONERS RIGHT TO DUE
PROCESS.
C.

Forthwith, Collantes moved for a reconsideration of this Resolution, but was denied
by the CSC in the second assailed Resolution No. 030542 dated 5 May 2003.4
On 18 July 2003, herein petitioner Collantes then filed a Petition for Certiorari with
the Court of Appeals praying for the reversal of the Civil Service Commission (CSC)
Resolutions No. 021482 and No. 030542. Before the Court of Appeals can decide
this case, however, petitioner was appointed as General Manager of the Philippine
Retirement Authority on 5 August 2004. The Court of Appeals dismissed the Petition
for Certiorari in the assailed 10 March 2005 Decision:
WHEREFORE, the Petition for Certiorari is hereby DISMISSED. No grave abuse of
discretion may be imputed against the Civil Service Commission for rendering
Resolution Nos. 021482 and 030542, dated 12 November 2002 and 5 May 2003,
respectively. No pronouncement as to costs.5

WHETHER THE COURT OF APPEALS COMMITTED A GRAVE AND


REVERSIBLE ERROR WHEN IT UPHELD THE RESOLUTION OF THE CIVIL
SERVICE COMMISSION WHICH HELD THAT PETITIONER MAY BE
REMOVED FROM HIS POSITION AS UNDERSECRETARY OF THE
DEPARTMENT OF NATIONAL DEFENSE WITHOUT THE CONCOMITANT
TRANSFER TO A POSITION EQUIVALENT IN RANK OR BE REMOVED
THEN, BE FLOATED PERPETUALLY, WHICH IS TANTAMOUNT TO A
CONSTRUCTIVE DISMISSAL, IN VIOLATION OF HIS RIGHT TO SECURITY
OF TENURE AS A CAREER EXECUTIVE SERVICE ELIGIBLE.7
Both petitioner and herein respondents CSC and Department of National Defense
(DND) invoke the doctrine of immutability of final judgments.

141

Petitioner claims that the 13 August 2001 Resolution of the CSC, which held that
petitioner "was illegally removed as Undersecretary of the Department of National
Defense and therefore x x x should be given a position where his eligibility is
appropriate or sufficient," has attained finality. Petitioner adds that, not only has
there been no appeal or motion for reconsideration filed within the allowable periods,
the CSC even granted the Motion for Execution filed by petitioner in its Order dated
15 January 2002. Petitioner thereby invokes our ruling that, before a writ of
execution may issue, there must necessarily be a final judgment or order that
disposes of the action or proceeding.8 Petitioner also faults the CSC for ruling on a
mere letter filed by Atty. Leticia Gloria of the DND, which petitioner claims is
fatally defective for failure to comply with the procedural due process clause of the
Constitution, the Rules of Court, and the Uniform Rules in Administrative Cases in
the Civil Service which require notice to adverse parties.9
Respondents, on the other hand, invoke the same doctrine of immutability of final
judgments, this time with respect to the 30 August 2001 Decision of the Court of
Appeals dismissing the Petition for Quo Warranto and Mandamus filed by petitioner.
This Court of Appeals Decision became final and executory when petitioner
withdrew the Motion for Extension to File a Petition for Review on Certiorari he
filed with this Court.10
Forum Shopping, Res Judicata, and Litis Pendentia
Our rules on forum shopping are meant to prevent such eventualities as conflicting
final decisions as in the case at bar. We have ruled that what is important in
determining whether forum shopping exists or not is the vexation caused the courts
and parties-litigants by a party who asks different courts and/or administrative
agencies to rule on the same or related causes and/or grant the same or substantially
the same reliefs, in the process creating the possibility of conflicting decisions being
rendered by the different fora upon the same issues.11
More particularly, the elements of forum shopping are: (a) identity of parties or at
least such parties as represent the same interests in both actions; (b) identity of the
rights asserted and the reliefs prayed for, the relief being founded on the same facts;
and (c) the identity of the two preceding particulars, such that any judgment rendered
in the other action will, regardless of which party is successful, amount to res
judicata in the action under consideration.12
Forum shopping can be committed in three ways: (1) filing multiple cases based on
the same cause of action and with the same prayer, the previous case not having been
resolved yet (where the ground for dismissal is litis pendentia); (2) filing multiple
cases based on the same cause of action and the same prayer, the previous case
having been finally resolved (where the ground for dismissal is res judicata); and (3)
filing multiple cases based on the same cause of action but with different prayers

(splitting of causes of action, where the ground for dismissal is also either litis
pendentia or res judicata).13 If the forum shopping is not considered willful and
deliberate, the subsequent cases shall be dismissed without prejudice on one of the
two grounds mentioned above. However, if the forum shopping is willful and
deliberate, both (or all, if there are more than two) actions shall be dismissed with
prejudice.14
Petitioner disputes respondents claim, and the CSCs ruling,15 that he had lodged
two separate actions. Petitioner explains that he never filed a case before the CSC.
He merely sought the assistance of the Career Executive Service Board (CESB) in a
letter-request dated 24 March 1999. Said letter-request, petitioner claims, did not ask
for any ruling.
Petitioner claims that, considering that two years had already lapsed without any
response from the CESB, he filed on 23 January 2001 his Petition for Quo Warranto
and Mandamus with the Court of Appeals. Petitioner was surprised when he learned
through the 8 February 2001 letter of the CESB that, on 29 November 2000, it
referred petitioners request to the CSC for appropriate action.16 Petitioner was not
required to submit any pleading in support of his request. Apparently, the CSC
treated the letter-request as a complaint or petition over which it could exercise its
adjudicative powers, as it issued its 13 August 2001 Resolution declaring petitioner
to have been illegally removed as Undersecretary of the DND, and should therefore
be given a position appropriate or sufficient for his eligibility.17 As stated above, the
Court of Appeals Decision dismissing the Petition for Quo Warranto and Mandamus
was rendered 17 days later, on 30 August 2001. Petitioner filed with this Court a
motion for an extension of time within which to file a Petition for Review on
Certiorari, but he later submitted a Manifestation for the withdrawal of this motion as
he decided not to pursue his appeal.18 Instead, petitioner filed with the CSC on 25
October 2001 a Motion for the Issuance of a Writ of Execution,19 which the CSC
granted on 15 January 2002.20
In repeatedly asserting that he did not file two separate actions, petitioner is arguing,
without stating it categorically, that he cannot be held liable for forum shopping.
However, what one cannot do directly cannot be done indirectly. Petitioner had been
aware, through the 8 February 2001 letter of the CESB, that his request for assistance
was referred to the CSC on 29 November 2000 for appropriate action. From that
point on, he knew that two government agencies the CSC and the Court of Appeals
were simultaneously in the process of reaching their respective decisions on
whether petitioner was entitled to reinstatement or to a position appropriate to his
eligibility. Therefore, it cannot be denied that petitioner knew, from the moment of
receipt of the 8 February 2001 letter of the CESB, that he had effectively instituted
two separate cases, and whatever original intention he had for his letter-request is, by
then, forgotten. Petitioner subsequently proceeded to act like a true forum shopper

142

he abandoned the forum where he could not get a favorable judgment, and moved to
execute the Resolution of the forum where he succeeded.
Petitioners above actuation is, in fact, a violation of his certification against forum
shopping with the Court of Appeals, a ground for dismissal of actions distinct from
forum shopping itself. As petitioner knew from the receipt of the CESB letter that
another claim was pending in a quasi-judicial agency concerning these issues, he was
bound by his certification with the Court of Appeals to report such fact within five
days from his knowledge thereof. This circumstance of being surprised by the
discovery of another pending claim with another court or quasi-judicial agency is
the very situation contemplated by letter (c) in the first paragraph of Section 5, Rule
7 of the Rules of Court:
Section 5. Certification against forum shopping. The plaintiff or principal party
shall certify under oath in the complaint or other initiatory pleading asserting a claim
for relief, or in a sworn certification annexed thereto and simultaneously filed
therewith: (a) that he has not theretofore commenced any action or filed any claim
involving the same issues in any court, tribunal or quasi-judicial agency and, to the
best of his knowledge, no such other action or claim is pending therein; (b) if there is
such other pending action or claim, a complete statement of the present status
thereof; and (c) if he should thereafter learn that the same or similar action or claim
has been filed or is pending, he shall report that fact within five (5) days therefrom to
the court wherein his aforesaid complaint or initiatory pleading has been filed.
(Emphases supplied.)
Petitioner, however, further asserts that the issues brought in the Petition for
Certiorari filed with the Court of Appeals on 18 July 2003 and the Petition for Quo
Warranto and Mandamus filed on 29 January 2001 are distinct, and that the Decision
of the Court of Appeals in the latter cannot constitute res judicata with respect to the
former.21 Petitioner claims that the issues, remedies and reliefs in the two cases are
different, citing as basis the textbook definitions of quo warranto, certiorari and
mandamus. Petitioner further claims that:
There is a clear distinction between the right of petitioner to the position of
Undersecretary for Civilian Relations and his right to be re-appointed to another
position of equivalent rank, in view of his CESO I status. The former issue may have
been resolved by the Court of Appeals when it ruled that petitioner Collantes had
"effectively resigned from his position as Undersecretary of the DND, and the public
respondents are under no compulsion to reinstate him to his old position." The latter
issue, or the right of petitioner Collantes to be given a new assignment fitting to his
CESO I rank, arises from his right to security of tenure as a Career Executive Service
Eligible, and not from his appointment to the DND.22

This allegedly clear distinction springs from petitioners claim that he resigned from
his position, but not from his rank as a Career Executive Service Officer (CESO).
Petitioner claims that, as a CESO, there is a "great difference between (1) resigning
from ones position and (2) resigning or relinquishing ones rank, as position is
different from ones rank. POSITION refers to the particular or specific office from
which one may be appointed. RANK, on the other hand, refers not to a particular
position but to the class to which one belongs in the hierarchy of authority in an
organization or bureaucracy."23 Petitioner cites Cuevas v. Bacal24:
[S]ecurity of tenure to members of the CES does not extend to the particular
positions to which they may be appointed --- a concept which is applicable only to
the first and second-level employees in the civil service --- but to the rank to which
they are appointed by the President.
xxxx
Mobility and flexibility in the assignment of personnel, the better to cope with the
exigencies of public service, is thus the distinguishing feature of the Career
Executive Service. x x x.
and General v. Roco25:
In addition, it must be stressed that the security of tenure of employees in the career
executive service (except first and second-level employees in the civil service),
pertains only to rank and not to the office or to the position to which they may be
appointed. Thus, a career executive service officer may be transferred or reassigned
from one position to another without losing his rank which follows him wherever he
is transferred or reassigned. In fact, a CESO suffers no diminution of salary even if
assigned to a CES position with lower salary grade, as he is compensated according
to his CES rank and not on the basis of the position or office he occupies.
While there is indeed a distinction between position and rank, such that a CESO may
be transferred or reassigned from one position to another without losing his rank,
there can be no distinction between resigning from a position and resigning from a
rank. The rank of a CESO is deactivated upon separation from the government
service, which includes the resignation of a CESO from his position. The CESB has
clarified this concept of being in the inactive status in its Resolution No. 554, series
of 2002:
Rule II
xxxx

143

7. CESO in Inactive Status - is a CESO who no longer occupies a position in the


CES as a result of any of the modes of separation from the government service,
provided that such separation is not due to dismissal from the service for cause.

2001 CSC Resolution declaring petitioner Collantes to be illegally removed as


Undersecretary of the DND?
Two Conflicting Final and Executory Decisions

xxxx
Jurisprudence in the United States offers different solutions to this problem:
Rule IV
Section 1. Modes of Deactivating a CES Rank. There are three (3) modes by which
the CES Rank of a CESO may be deactivated from the CES:
1. Acceptance of a position by virtue of an appointment outside the coverage of the
CES;
2. Dropping from the rolls of government officials and employees; and
3. Other modes of separation from the CES, provided that separation from the CES
resulting from dismissal from the service for cause and after due process shall result
in the loss of CES rank and shall not be considered as a mode of deactivation.
xxxx
Sec. 2. Effect of Deactivation of CES Rank. A CESO whose CES rank has been
deactivated by the Board loses all the rights and privileges accorded to him/her by
law on account of his/her CES rank.
Likewise, it would be absurd for us to rule that a civil servant who resigns from his
position can compel the President to appoint him to another position. Such a ruling
would effectively derogate the discretion of the appointing authority,26 as it will give
the CESO the option to choose which position he or she wants, by the simple
expediency of resigning from the position he or she does not want.
In sum, there is an identity of issues in the two cases which resulted in the two
conflicting final and executory decisions. But while, as stated above, the second
petition can be dismissed on the ground of either res judicata or non-compliance with
the undertakings in petitioners certification against forum shopping, these grounds
can only be invoked when the case is still pending. As petitioner points out, the
Resolution of the CSC had already become final and executory.
The 30 August 2001 Decision of the Court of Appeals, however, has also attained
finality. Hence, we go back to the main issue in this petition: which of the two final
and executory decisions should be given effect, the 30 August 2001 Court of Appeals
Decision dismissing the petitioners Petition for Quo Warranto, or the 13 August

Where there have been two former actions in which the claim or demand, fact or
matter sought to be religated has been decided contrarily, the rule that, where there is
an estoppel against an estoppel, it "setteth the matter at large" has been applied by
some authorities, and in such case both parties may assert their claims anew. Other
authorities have held that, of two conflicting judgments on the same rights of the
same parties, the one which is later in time will prevail, although it has also been
held that the judgment prior in time will prevail. It has been held that a decision of a
court of last resort is binding on the parties, although afterward, in another cause, a
different principle was declared.27
There are thus three solutions which we can adopt in resolving the case at bar: the
first is for the parties to assert their claims anew, the second is to determine which
judgment came first, and the third is to determine which of the judgments had been
rendered by a court of last resort.
As there are conflicting jurisprudence on the second solution, it is appropriate for
this Court to adopt either the first or the third solution. The first solution involves
disregarding the finality of the two previous judgments and allowing the parties to
argue on the basis of the merits of the case anew. The third solution merely involves
the determination of which judgment has been rendered by this Court, the court of
last resort in this jurisdiction.
Adopting the third solution will result in the denial of this Petition for Certiorari.
Whereas the finality of the 13 August 2001 CSC Resolution came about by the
failure to file a motion for reconsideration or an appeal within the proper
reglementary periods, the finality of the 30 August 2001 Court of Appeals Decision
was by virtue of the 12 November 2001 Resolution28 of this Court which declared
the case closed and terminated upon the manifestation of petitioner that he decided
not to pursue his appeal and was thus withdrawing the motion for extension of time
to file a petition for review on certiorari.
The better solution, however, is to let the parties argue the merits of the case anew,
and decide the case on the basis thereof. We can do this either by remanding the case
to a lower court, or by resolving the issues in this disposition. The latter recourse is
more appropriate, for three reasons: (1) all the facts, arguments, and pleadings in
support of the parties contentions are now before us, with the parties advancing the
very same contentions as those in this Petition; (2) a remand to the Court of Appeals

144

would entail asking the latter to resolve the very same issues it had passed upon
twice; and (3) a remand to the Court of Appeals would only entail another
unnecessary delay in the termination of the case when the case is now ripe for
adjudication before us.
The merits of the case are the focus of petitioners third assignment of error in the
present petition. Petitioner claims that the Court of Appeals committed a grave and
reversible error when it upheld the resolution of the CSC which allegedly effectively
held "that petitioner may be removed from his position as Undersecretary of the
Department of National Defense without the concomitant transfer to a position
equivalent in rank or be removed then, be floated perpetually, which is tantamount to
a constructive dismissal, in violation of his right to security of tenure as a career
executive service eligible."29
Petitioners arguments presuppose that he had been removed from his position as
Undersecretary of the DND. He, however, did not present any evidence to that effect,
whether in this Petition or in his earlier Petition for Quo Warranto and Mandamus
with the Court of Appeals. If he is implying that he was removed from office by
virtue of his account that he was approached by persons close to President Joseph
Estrada who asked him to relinquish his post, which he did, then this Petition must
fail, for, by his own deliberate deed, he resigned from his position.

There are no special legal effects when a resignation is one of a courtesy resignation.
The mere fact that the President, by himself or through another, requested for
someones resignation does not give the President the obligation to appoint such
person to another position. A courtesy resignation is just as effectual as any other
resignation. There can be no implied promises of another position just because the
resignation was made out of courtesy. Any express promise of another position, on
the other hand, would be void, because there can be no derogation of the discretion
of the appointing power,30 and because its object is outside the commerce of man.31
As held by the Court of Appeals in its 30 August 2001 Decision:
In the first place, petitioner has not established by any quantum of certainty the
veracity of his claim that he was promised an equivalent position in the government.
Assuming, however, that such promise was true, petitioner, as a ranking member of
the bureaucracy, ought to have known that such promise offers no assurance in law
that the same would be complied with. The time-honored rule is that public office is
a public trust, and as such, the same is governed by law, and cannot be made the
subject of personal promises or negotiations by private persons.32
WHEREFORE, the present Petition for Review on Certiorari is DENIED. No costs.
SO ORDERED

SUPREME COURT
Manila

employee during the Marcos administration did not immediately make her a close
subordinate or close associate of former President Marcos.1

FIRST DIVISION

The Case

G.R. No. 180418

August 28, 2013

REPUBLIC OF THE PHILIPPINES, PETITIONER,


vs.
LUZ REYES-BAKUNAWA, MANUEL BAKUNAWA, JR., MANUEL
BAKUNAWA III, FERDINAND E. MARCOS AND IMELDA R. MARCOS,
RESPONDENTS.
DECISION
BERSAMIN, J.:
Assets or properties, to be considered as ill-gotten wealth, must be shown to have
originated from the Government itself, and should have been taken by former
President Marcos, the members of his immediate family, relatives, close subordinates
and close associates by illegal means. That one served as a government official or

The Republic appeals the adverse decision rendered on April 10, 2002,2 and the
resolution issued on November 8, 2007,3 whereby the Sandiganbayan respectively
dismissed the complaint for reconveyance, reversion, accounting, restitution and
damages filed against respondents in Civil Case No. 0023, and denied the Republics
motion for reconsideration.
Antecedents
Civil Case No. 0023 is an action for reconveyance, reversion, accounting, restitution
and damages brought by the Republic against respondents Luz Reyes-Bakunawa,
Manuel Bakunawa, Jr., Manuel Bakunawa III, President Marcos and First Lady
Imelda R. Marcos for having allegedly acquired and accumulated ill-gotten wealth
consisting of funds and other property "in unlawful concert with one another" and "in
flagrant breach of trust and of their fiduciary obligations as public officers, with
grave abuse of right and power and in brazen violation of the Constitution and laws
of the Republic of the Philippines, thus resulting in their unjust enrichment." 4

145

The complaint alleged that respondent Luz Reyes-Bakunawa (Luz Bakunawa) had
served as Imelda Marcos Social Secretary during the Marcos administration; that it
was during that period of her incumbency in that position that Luz Bakunawa and
her husband Manuel Bakunawa had acquired assets, funds and other property grossly
and manifestly disproportionate to her salaries and their other lawful income;5 and
that Luz Bakunawa, "by herself and/or in unlawful concert with Defendants
Ferdinand E. Marcos and Imelda R. Marcos, taking undue advantage of her position,
influence and connection with the latter Defendant spouses, for their benefit and
unjust enrichment and in order to prevent disclosure and recovery of assets illegally
obtained, engaged in devices, schemes and stratagems,"6 particularly:
1) acted as dummies, nominees, and/or agents of the Marcos spouses and, with the
active collaboration, knowledge and willing participation of the other defendants,
established several corporations engaged in a wide range of economic activities, such
as construction and cattle ranching;
2) secured favorable contracts with the Department of Public Works and
Communications for the construction of government projects through grossly
undercapitalized corporations and without complying with such usual requirements
as public bidding, notice and publication of contractors;
3) unlawfully acquired heads of cattle from the government dispersal program and
raised them on ranch lands encroaching on forest zones;
4) unlawfully encroached upon a mangrove-forested section in Masbate, Masbate
and converted it into a fishpond;
5) unlawfully amassed funds by obtaining huge credit lines from government
financial institutions, and incorporating into their contracts a cost-escalation
adjustment provision to justify collection of grossly arbitrary and unconscionable
amounts unsupported by evidence of increase in prices;
6) unlawfully imported hundreds of brand-new units of heavy equipment without
paying customs duties and other allied taxes amounting to millions of pesos, by
falsely representing said heavy equipment to be for official government use and
selling them at very low prices to avoid paying the required taxes.7
The Republic prayed for: (a) the reconveyance to itself of all funds and other
property impressed with constructive trust, as well as funds and other property
acquired by respondents abuse of right and power and through unjust enrichment,
plus interests; (b) accounting of all beneficial interests in funds, properties and assets
in excess of their unlawful earnings; and (c) payment of actual damages to be proved
during the trial, moral damages of P50,000,000,000.00, temperate, nominal and
exemplary damages, attorneys fees, litigation expenses and treble judicial costs.8

In their amended answer, the Bakunawas alleged that Luz Bakunawa was never the
Social Secretary of Imelda Marcos, but only an employee in the office of the Social
Secretary; that the properties acquired while Luz Bakunawa was employed in the
Government were purchased with honestly earned money and their acquisition was
well within their legitimate income; that their family owned and controlled five
closed family corporations, namely: (1) Hi-Tri Development Corporation; (2) 7-R
Development Corporation; (3) 7-R Heavy Equipment, Inc.; (4) 7-R Sales Company,
Inc.; and (5) 7-R Ranch, Inc.; that their public works contracts were awarded to them
in accordance with law; that their acquisition of the heads of cattle were legal;9 and
that they did not commit any breach of trust while in public office, and did not
possess illegally acquired funds that rendered them liable under constructive trust in
favor of the Republic.10
During the pre-trial on August 26, 1999, the Bakunawas admitted that: (a) the
properties enumerated in Annex A of the complaint11 belonged to or were connected
to them, except three corporations, namely:7-R International Trading, 7-R Enterprise,
Inc., and 7-R Group of Companies; and (b) two parcels of land that belonged to one
of their children.12
Also during the pre-trial, the parties agreed on the following statement of the issues,
to wit:
[t]he fundamental issue in this case is whether or not defendant Luz Bakunawa,
considering her position in Malacaang during the incumbency of President
Ferdinand E. Marcos from 1970 up to 1986, occupied a confidential position in
Malacaang, and was able to obtain contracts, run businesses and acquire real
properties as enumerated in the Complaint, using her office and the influence of
either or both of the [s]pouses Ferdinand and Imelda Marcos. The parties agreed that
it is the use of the influence of the Spouses Marcos that constitutes the essence of the
case, and not the failure to report the Statement of Assets and Liabilities or any other
impropriety in the acquisition of the properties herein, this case having been filed
under the authority given to the Presidential Commission on Good Government
under Executive Orders No. 1,2, 14 and 14-a.13
After the Republic rested its case, respondents filed their motion to dismiss,14
insisting that the Republic "has failed to establish even prima facie, its case and/or
charges against them."15
Ruling of the Sandiganbayan
On April 10, 2002, the Sandiganbayan rendered its decision in favor of respondents,
to wit:16

146

xxxx
As the evidence stands, neither the presence of the link with the Marcoses, nor the
irrefutability of the evidence against the Bakunawas for their misuse of that
connection exists to justify the instant action by the PCGG.
In view of all the above, this Court is constrained to grant the Motion to Dismiss, as
it hereby dismisses, the Complaint of the plaintiff for its failure to prove the essential
allegations thereof.
The writs of sequestration issued and in force against the properties of the
Bakunawas as enumerated in Annex A of the Complaint (page 24 and p. 34, Vol. I,
Record) are lifted, set aside and declared of no further force and effect.
SO ORDERED.
The Sandiganbayan justified its decision in the following manner:
xxxx
Many of the plaintiffs allegations in its specific averments (Article V) in the
complaint are alluded to in the evidence in a general fashion: engaging in cattle
ranching and construction [para. 12 (a)], entering into public works contracts
[para.12 (b)], acquisition of mangrove areas [para. 12 (c)]. Nothing exists in the
record, however, with respect to undercapitalization of the corporation, noncompliance with bidding requirements, encroachment of ranches into forest zones,
huge credit lines, unjustified claims of cost escalation adjustment, and importation of
heavy equipment.

defendants Bakunawa and the allegedly (sic) inaction by the Bureau of Forestry and
the police agencies thereon. Thus, the almost uniform allegation of witnesses is that
they were dispossessed of pasture lands which they believed they were entitled to
possess. There were documents presented to prove that, indeed, the witnesses had
claims to these pieces of property or had occupied them and had introduced
improvements thereon.
The tenor of the testimony of the said witnesses is that while there was no force
directly applied in the dispossession of their properties, their lands, however, were
fenced in, and occupied by, other people, allegedly the Bakunawas and secured by
armed and uniformed men.
There is likewise the contention of the plaintiffs witnesses that they did not know
who these men were, although it has been said that one or two of the men who
helped in fencing off these properties were employees of the Bakunawas.
What is clear is that with the evidence thus far, the Bakunawas, or more specifically,
Manuel Bakunawa, ignored the Bureau of Forestry summons, and caused the
unceremonious exclusion of people who had apparently occupied rather large tracts
of land under permits for the Bureau or those with pending applications.
There also seems to be evidence that defendant Luz Bakunawa did quite a bit of
work in her capacity as a member of the staff of the Social Secretary of Imelda
Marcos. While the influence of Luz Bakunawa may be assumed or conjectured, there
has been no evidence which would categorically show that the position of defendant
Luz Bakunawa in Malacaang "in concert with the spouses Marcos" or either of
them was the explanation for the absence of the law enforcement officers or the
inaction of the administrative officers of the government.

Properties have been shown in the name of the spouses Bakunawa or either of them;
testimonies have been rendered about eviction, official documents presented with
respect to public works contracts, and finally, a Statement of Assets and Liabilities
for the year 1985. Indeed, to hear some of the witnesses, acts of oppression appear to
have been committed if not by the wife then by the husband Manuel Bakunawa.
There is no indication however, that the acts of oppression involved the improper use
of influence on the part of the defendant Luz Bakunawa by reason of her having been
employed in the office of the Social Secretary of Imelda Marcos when the latter was
the First Lady.

xxxx

xxxx

The Sandiganbayan ruled that in civil suits initiated by the Presidential Commission
on Good Government (PCGG) for the recovery of illegally acquired property
pursuant to Republic Act No. 1379,18 the Republic must show not only that
defendant was a subordinate of the Marcos spouses or of either of them, but also that
the relationship was similar to that of an immediate member of the Marcos family or

An examination of the testimonial evidence for the Plaintiff, as summarized in the


first part of this decision, shows its concentration in the alleged dispossession of
some landowners of their occupied land in the province of Masbate by the

The influence may be assumed and in common parlance, it might be reasonably


made. But to conclude that there was abuse of office by Luz Bakunawa or her
utilization of the influence of her office or of the spouses Marcos cannot be assumed
or stated in any certainty.
And since, as aforesaid, the action herein is confiscatory in character, assumptions
will not do to obtain judgment against the defendants Bakunawa.17

147

a dummy of the Marcoses.19 It concluded that no proof established the link between
the alleged acts of the Bakunawas and those of the Marcoses, or even the proximity
of Luz Bakunawa as a Marcos relative or Marcos dummy.

On her part, First Lady Marcos opted not to file her comment.24

The Republic sought the reconsideration of the decision, arguing that the
Sandiganbayan erred in holding that it did not show the Bakunawas link with the
Marcoses, and in ruling that it did not prove that the Bakunawas had abused their
connections or close association with the Marcoses.20

The appeal lacks merit.

Ruling

1.
Appeal of the Republic was timely

On November 8, 2007, the Sandiganbayan denied the Republics motion for


reconsideration,21 reiterating its ruling that the Republic did not discharge its burden
of proving the close links between the Bakunawas and the Marcoses, and of proving
how the Bakunawas had abused said links, assuming that the links existed.

The Bakunawas contend that the April 10, 2002 decision already became final
because of the Republics failure to file the petition for review on time.
We cannot sustain the contention.

Hence, this appeal.


Issues
The Republic ascribes the following errors, to wit:
I.

The Republic had until November 24, 2007 within which to file the petition for
review. It filed a motion seeking an extension of 30 days of its period to file, or until
December 24, 2007. Although it did not file the petition within the requested
extension period, the Court directed it on June 30, 2008 to file the petition for review
within 15 days from notice. Considering that it received the resolution of June 30,
2008 on August 11, 2008,25 its filing of the petition for review on August 26, 2008
was timely.

THE QUANTUM OF PROOF REQUIRED TO PROVE PETITIONERS CASE


AGAINST THE BAKUNAWAS IS MERE PREPONDERANCE OF EVIDENCE.

2.

II.

Preponderance of evidence is required in actions brought to recover ill-gotten wealth

THE LINK BETWEEN AND/OR AMONG THE BAKUNAWAS AND THE


MARCOSES WAS SATISFACTORILY ESTABLISHED BY PETITIONER.

In its decision of April 10, 2002, the Sandiganbayan stated as follows:

III.
PETITIONER WAS ABLE TO ESTABLISH THAT THE BAKUNAWAS
AMASSED ASSETS, FUNDS AND PROPERTIES GROSSLY AND
MANIFESTLY DISPROPORTIONATE TO THEIR SALARIES AND OTHER
LAWFUL INCOME BECAUSE OF THEIR POSITION IN THE GOVERNMENT
AND/OR CLOSE ASSOCIATION AND CONNECTION WITH THE MARCOSES
TO THE PREJUDICE OF PETITIONER AND THE FILIPINO PEOPLE.22
In their comment,23 respondents mainly submit that the Republic failed to present a
justiciable issue to warrant the reversal of the Sandiganbayans decision; and that the
April 10, 2002 decision already become final and could no longer be reviewed and
modified because of the belated filing of the petition for review.

Considering the confiscatory character of proceedings described in E.O. No. 14 in


actions for recovery of alleged unlawfully acquired property such as the instant case,
evidence must be substantial, if not beyond reasonable doubt, akin to the actions for
forfeiture under Republic Act. No. 1379; this, notwithstanding the statements in Sec.
3 of the Executive Order which states the adequacy of mere preponderance of
evidence.26
The Republic argues that the Sandiganbayan thereby erred in seemingly requiring a
degree of proof greater than that required by Executive Order (E.O.) No. 14-A.27
This was also its submission in the motion for reconsideration vis--vis the decision
of April 10, 2002.
In denying the Republics motion for reconsideration through the November 8, 2007
resolution, the Sandiganbayan agreed with the Republics submission to the effect
that preponderance of evidence was all that was required for this case. However, the

148

Sandiganbayan pointed out that even on that basis the Republic still did not satisfy
its quantum of proof because the facts it established were not sufficient to prove its
case against respondents.28
We uphold the Sandiganbayan.
We first clarify that the Republic correctly submits that only a preponderance of
evidence was needed to prove its demand for reconveyance or recovery of ill-gotten
wealth. That is quite clear from Section 1 of E.O. No. 14-A, which provides:
Section 1. Section 3 of Executive Order No. 14 dated May 7, 1986 is hereby
amended to read as follows:

are no better off than before they proceeded upon their litigation. In that situation, the
court should leave the parties as they are.31
Moreover, although the evidence of the plaintiff may be stronger than that of the
defendant, there is no preponderance of evidence on the plaintiffs side if its
evidence alone is insufficient to establish its cause of action.32 Similarly, when only
one side is able to present its evidence, and the other side demurs to the evidence, a
preponderance of evidence can result only if the plaintiffs evidence is sufficient to
establish the cause of action. For this purpose, the sheer volume of the evidence
presented by one party cannot tip the scales in its favor. Quality, not quantity, is the
primordial consideration in evaluating evidence.
3.

Sec. 3. The civil suits to recover unlawfully acquired property under Republic Act
No. 1379 or for restitution, reparation of damages, or indemnification for
consequential and other damages or any other civil actions under the Civil Code or
other existing laws filed with the Sandiganbayan against Ferdinand E. Marcos,
Imelda R. Marcos, members of their immediate family, close relatives, subordinates,
close and/or business associates, dummies, agents and nominees, may proceed
independently of any criminal proceedings and may be proved by a preponderance of
evidence.
By preponderance of evidence is meant that the evidence adduced by one side is, as a
whole, superior to that of the other side. Essentially, preponderance of evidence
refers to the comparative weight of the evidence presented by the opposing parties.
As such, it has been defined as "the weight, credit, and value of the aggregate
evidence on either side," and is usually considered to be synonymous with the term
greater weight of the evidence or greater weight of the credible evidence. It is proof
that is more convincing to the court as worthy of belief than that which is offered in
opposition thereto.29

The evidence of the Republic did not preponderantly establish the ill-gotten nature of
the Bakunawas wealth
The decisive query is whether the Republic preponderantly showed that the
Bakunawas had acquired ill-gotten wealth during Luz Bakunawas employment
during the Marcos administration.
In Republic v. Sandiganbayan (First Division), decided on April 12, 2011,33 the
Court settled not only the meaning of ill-gotten wealth but also who were the persons
liable to illegally acquire or amass such wealth, viz:
xxxx
II
The Concept and Genesis of Ill-Gotten Wealth in the Philippine Setting

Here, the Bakunawas filed a motion to dismiss, by which they specifically demurred
to the evidence adduced against them. A demurrer to evidence is an objection by one
of the parties in an action to the effect that the evidence that his adversary produced,
whether true or not, is insufficient in point of law to make out a case or to sustain the
issue. The demurring party thereby challenges the sufficiency of the whole evidence
to sustain a judgment. The court, in passing upon the sufficiency of the evidence, is
required merely to ascertain whether there is competent or sufficient evidence to
sustain the indictment or claim, or to support a verdict of guilt or liability.30

A brief review of the Philippine law and jurisprudence pertinent to ill-gotten wealth
should furnish an illuminating backdrop for further discussion.

Under the rule on preponderance of evidence, the court is instructed to find for and
to dismiss the case against the defendant should the scales hang in equipoise and
there is nothing in the evidence that tilts the scales to one or the other side. The
plaintiff who had the burden of proof has failed to establish its case, and the parties

The first official issuance of President Aquino, which was made on February 28,
1986, or just two days after the EDSA Revolution, was Executive Order (E.O.) No.
1, which created the Presidential Commission on Good Government (PCGG).
Ostensibly, E.O. No. 1 was the first issuance in light of the EDSA Revolution having

In the immediate aftermath of the peaceful 1986 EDSA Revolution, the


administration of President Corazon C. Aquino saw to it, among others, that rules
defining the authority of the government and its instrumentalities were promptly put
in place. It is significant to point out, however, that the administration likewise
defined the limitations of the authority.

149

come about mainly to address the pillage of the nations wealth by President Marcos,
his family, and cronies.

The BASECO definition of ill-gotten wealth was reiterated in Presidential


Commission on Good Government v. Lucio C. Tan, where the Court said:

E.O. No. 1 contained only two WHEREAS Clauses, to wit:


WHEREAS, vast resources of the government have been amassed by former
President Ferdinand E. Marcos, his immediate family, relatives, and close associates
both here and abroad;
WHEREAS, there is an urgent need to recover all ill-gotten wealth;
Paragraph (4) of E.O. No. 234 further required that the wealth, to be ill-gotten, must
be "acquired by them through or as a result of improper or illegal use of or the
conversion of funds belonging to the Government of the Philippines or any of its
branches, instrumentalities, enterprises, banks or financial institutions, or by taking
undue advantage of their official position, authority, relationship, connection or
influence to unjustly enrich themselves at the expense and to the grave damage and
prejudice of the Filipino people and the Republic of the Philippines."
Although E.O. No. 1 and the other issuances dealing with ill-gotten wealth (i.e., E.O.
No. 2, E.O. No. 14, and E.O. No. 14-A) only identified the subject matter of illgotten wealth and the persons who could amass ill-gotten wealth and did not include
an explicit definition of ill-gotten wealth, we can still discern the meaning and
concept of ill-gotten wealth from the WHEREAS Clauses themselves of E.O. No. 1,
in that ill-gotten wealth consisted of the "vast resources of the government" amassed
by "former President Ferdinand E. Marcos, his immediate family, relatives and close
associates both here and abroad." It is clear, therefore, that ill-gotten wealth would
not include all the properties of President Marcos, his immediate family, relatives,
and close associates but only the part that originated from the "vast resources of the
government."
In time and unavoidably, the Supreme Court elaborated on the meaning and concept
of ill-gotten wealth. In Bataan Shipyard & Engineering Co., Inc. v. Presidential
Commission on Good Government, or BASECO, for the sake of brevity, the Court
held that:
x x x until it can be determined, through appropriate judicial proceedings, whether
the property was in truth "ill-gotten," i.e., acquired through or as a result of improper
or illegal use of or the conversion of funds belonging to the Government or any of its
branches, instrumentalities, enterprises, banks or financial institutions, or by taking
undue advantage of official position, authority, relationship, connection or influence,
resulting in unjust enrichment of the ostensible owner and grave damage and
prejudice to the State. And this, too, is the sense in which the term is commonly
understood in other jurisdictions.

On this point, we find it relevant to define "ill-gotten wealth." In Bataan Shipyard


and Engineering Co., Inc., this Court described "ill-gotten wealth" as follows:
"Ill-gotten wealth is that acquired through or as a result of improper or illegal use of
or the conversion of funds belonging to the Government or any of its branches,
instrumentalities, enterprises, banks or financial institutions, or by taking undue
advantage of official position, authority, relationship, connection or influence,
resulting in unjust enrichment of the ostensible owner and grave damage and
prejudice to the State. And this, too, is the sense in which the term is commonly
understood in other jurisdiction."
Concerning respondents shares of stock here, there is no evidence presented by
petitioner that they belong to the Government of the Philippines or any of its
branches, instrumentalities, enterprises, banks or financial institutions. Nor is there
evidence that respondents, taking undue advantage of their connections or
relationship with former President Marcos or his family, relatives and close
associates, were able to acquire those shares of stock.
Incidentally, in its 1998 ruling in Chavez v. Presidential Commission on Good
Government, the Court rendered an identical definition of ill-gotten wealth, viz:
x x x. We may also add that ill-gotten wealth, by its very nature, assumes a public
character. Based on the aforementioned Executive Orders, ill-gotten wealth refers
to assets and properties purportedly acquired, directly or indirectly, by former
President Marcos, his immediate family, relatives and close associates through or as
a result of their improper or illegal use of government funds or properties; or their
having taken undue advantage of their public office; or their use of powers, influence
or relationships, "resulting in their unjust enrichment and causing grave damage and
prejudice to the Filipino people and the Republic of the Philippines." Clearly, the
assets and properties referred to supposedly originated from the government itself.
To all intents and purposes, therefore, they belong to the people. As such, upon
reconveyance they will be returned to the public treasury, subject only to the
satisfaction of positive claims of certain persons as may be adjudged by competent
courts. Another declared overriding consideration for the expeditious recovery of illgotten wealth is that it may be used for national economic recovery.
All these judicial pronouncements demand two concurring elements to be present
before assets or properties were considered as ill-gotten wealth, namely: (a) they
must have "originated from the government itself," and (b) they must have been

150

taken by former President Marcos, his immediate family, relatives, and close
associates by illegal means.
But settling the sources and the kinds of assets and property covered by E.O. No. 1
and related issuances did not complete the definition of ill-gotten wealth. The further
requirement was that the assets and property should have been amassed by former
President Marcos, his immediate family, relatives, and close associates both here and
abroad. In this regard, identifying former President Marcos, his immediate family,
and relatives was not difficult, but identifying other persons who might be the close
associates of former President Marcos presented an inherent difficulty, because it
was not fair and just to include within the term close associates everyone who had
had any association with President Marcos, his immediate family, and relatives.
Again, through several rulings, the Court became the arbiter to determine who were
the close associates within the coverage of E.O. No. 1.
In Republic v. Migrio, the Court held that respondents Migrio, et al. were not
necessarily among the persons covered by the term close subordinate or close
associate of former President Marcos by reason alone of their having served as
government officials or employees during the Marcos administration, viz:
It does not suffice, as in this case, that the respondent is or was a government official
or employee during the administration of former Pres. Marcos. There must be a
prima facie showing that the respondent unlawfully accumulated wealth by virtue of
his close association or relation with former Pres. Marcos and/or his wife. This is so
because otherwise the respondents case will fall under existing general laws and
procedures on the matter. x x x
In Cruz, Jr. v. Sandiganbayan, the Court declared that the petitioner was not a close
associate as the term was used in E.O. No. 1 just because he had served as the
President and General Manager of the GSIS during the Marcos administration.
In Republic v. Sandiganbayan, the Court stated that respondent Maj. Gen. Josephus
Q. Ramas having been a Commanding General of the Philippine Army during the
Marcos administration "d[id] not automatically make him a subordinate of former
President Ferdinand Marcos as this term is used in Executive Order Nos. 1, 2, 14 and
14-A absent a showing that he enjoyed close association with former President
Marcos."
It is well to point out, consequently, that the distinction laid down by E.O. No. 1 and
its related issuances, and expounded by relevant judicial pronouncements
unavoidably required competent evidentiary substantiation made in appropriate
judicial proceedings to determine: (a) whether the assets or properties involved had
come from the vast resources of government, and (b) whether the individuals owning

or holding such assets or properties were close associates of President Marcos. The
requirement of competent evidentiary substantiation made in appropriate judicial
proceedings was imposed because the factual premises for the reconveyance of the
assets or properties in favor of the government due to their being ill-gotten wealth
could not be simply assumed. Indeed, in BASECO, the Court made this clear enough
by emphatically observing:
6. Governments Right and Duty to Recover All Ill-gotten Wealth
There can be no debate about the validity and eminent propriety of the Governments
plan "to recover all ill-gotten wealth."
Neither can there be any debate about the proposition that assuming the above
described factual premises of the Executive Orders and Proclamation No. 3 to be
true, to be demonstrable by competent evidence, the recovery from Marcos, his
family and his minions of the assets and properties involved, is not only a right but a
duty on the part of Government.
But however plain and valid that right and duty may be, still a balance must be
sought with the equally compelling necessity that a proper respect be accorded and
adequate protection assured, the fundamental rights of private property and free
enterprise which are deemed pillars of a free society such as ours, and to which all
members of that society may without exception lay claim.
x x x Democracy, as a way of life enshrined in the Constitution, embraces as its
necessary components freedom of conscience, freedom of expression, and freedom
in the pursuit of happiness. Along with these freedoms are included economic
freedom and freedom of enterprise within reasonable bounds and under proper
control. x x x Evincing much concern for the protection of property, the Constitution
distinctly recognizes the preferred position which real estate has occupied in law for
ages. Property is bound up with every aspect of social life in a democracy as
democracy is conceived in the Constitution. The Constitution realizes the
indispensable role which property, owned in reasonable quantities and used
legitimately, plays in the stimulation to economic effort and the formation and
growth of a solid social middle class that is said to be the bulwark of democracy and
the backbone of every progressive and happy country.
a. Need of Evidentiary Substantiation in Proper Suit
Consequently, the factual premises of the Executive Orders cannot simply be
assumed. They will have to be duly established by adequate proof in each case, in a
proper judicial proceeding, so that the recovery of the ill-gotten wealth may be
validly and properly adjudged and consummated; although there are some who
maintain that the fact that an immense fortune, and "vast resources of the

151

government have been amassed by former President Ferdinand E. Marcos, his


immediate family, relatives, and close associates both here and abroad," and they
have resorted to all sorts of clever schemes and manipulations to disguise and hide
their illicit acquisitions is within the realm of judicial notice, being of so extensive
notoriety as to dispense with proof thereof. Be this as it may, the requirement of
evidentiary substantiation has been expressly acknowledged, and the procedure to be
followed explicitly laid down, in Executive Order No. 14.
Accordingly, the Republic should furnish to the Sandiganbayan in proper judicial
proceedings the competent evidence proving who were the close associates of
President Marcos who had amassed assets and properties that would be rightly
considered as ill-gotten wealth.
xxxx
As can be gleaned from the foregoing pronouncement, evidentiary substantiation of
the allegations of how the wealth was illegally acquired and by whom was necessary.
For that purpose, the mere holding of a position in the Marcos administration did not
necessarily make the holder a close associate within the context of E.O. No.1.
According to Republic v. Migrio,35 the term subordinate as used in E.O. No. 136
and E.O. No. 237 referred to a person who enjoyed a close association with President
Marcos and/or his wife similar to that of an immediate family member, relative, and
close associate, or to that of a close relative, business associate, dummy, agent, or
nominee. Indeed, a prima facie showing must be made to show that one unlawfully
accumulated wealth by virtue of a close association or relation with President
Marcos and/or his wife.38 It would not suffice, then, that one served during the
administration of President Marcos as a government official or employee.

Malacaang Palace during the Marcos administration, and did not establish her
having a close relationship with the Marcoses, or her having abused her position or
employment in order to amass the assets subject of this case. Consequently, Luz
Bakunawa could not be considered a close associate or subordinate of the Marcoses
within the context of E.O. No. 1 and E.O. No. 2.
The determination by the Sandiganbayan of the equiponderance or insufficiency of
evidence involved its appreciation of the evidence. We cannot undo such
determination unless the Republic makes a strong demonstration to us that the
determination was whimsical or capricious.43 Alas, the Republic did not make such
demonstration. Its evidence could not sustain the belief that the Bakunawas had used
their influence, or the Marcoses influence in acquiring their properties. Nor did it
prove that the ties or relationship between the Bakunawas and the Marcoses had been
"similar to that of an immediate member of the family or a dummy."
On another important aspect, the evidence of the Republic was likewise
wanting.1wphi1 The Sandiganbayan enumerated in its decision five activities in
which the Bakunawas had acquired their ill-gotten wealth, namely: (a) land-grabbing
and cattle-ranching; (b) engaging in government construction projects; (c) operating
fishponds; (d) obtaining credit lines from government financial institutions; and (e)
importing heavy equipment.44 However, the decision dwelt only on land-grabbing
and the construction projects for the reason that the Republic attempted to
substantiate only those two activities. The Court is thus limited to the review of the
findings on the two activities.

However, Luz Bakunawa maintains that she was not First Lady Marcos Social
Secretary but a mere member of the staff of the Social Secretary; and that the assets
of the Bakunawas were honestly earned and acquired well within the legitimate
income of their businesses.

Anent land-grabbing, the records show that although the Bakunawas had ignored the
summons from the Bureau of Forestry, and that the several persons occupying large
tracts of land under permits from the Bureau of Forestry or under still-pending
applications had been dispossessed thereof, the dispossessed persons whom the
Republic presented as witnesses could not tell in court that the Bakunawas had
employed the people who had fenced or occupied the lands in question. Such
witnesses admitted that they did not put up much resistance against their forcible
dispossession because of their belief that the Bakunawas had been very influential
and had enjoyed very close ties with the Marcoses. However, they did not show that
they had at the time any direct contact or communication with the Bakunawas, which
could only mean that they only surmised and suspected the participation of the
Bakunawas in their dispossession. As such, the Republics evidence in that regard
could not be sufficient, for surmises and suspicions could not support any conclusion
either that the Bakunawas had taken advantage of their close ties with the Marcoses
in order to dispossess the affected witnesses, or that Luz Bakunawa had abused her
influence arising from her close association with the Marcoses.

We hold that the Sandiganbayan correctly ruled that the evidence of the Republic
was able to establish, at best, that Luz Bakunawa had been an employee in

The Republic presented documents tending to prove that the dispossessed witnesses
had retained claims to the affected properties,45 and that the Bakunawas themselves

The Republic particularly insists that Luz Bakunawa served as the Social Secretary
or the Assistant Social Secretary of First Lady Marcos; and mentions several other
circumstances that indicated her close relationship with the Marcoses, such as her
assumption of office in the early part of the Marcos administration,39 the
accommodations extended to her during her various travels,40 the fact that her close
relationship with the Marcoses was of common knowledge among the
Masbateos,41 and the negotiated contracts the Bakunawas entered into during the
Marcos administration.42

152

had been issued pasture leases over the same areas.46 Given that both the
dispossessed witnesses and the Bakunawas held legal rights of possession respecting
the same areas independently of each other, the Sandiganbayan did not err in ruling
that "the plaintiffs evidence is not conclusive proof of the ill-gotten character of the
lands in the possession of the defendants Bakunawas."47 This is really a good reason
for the Sandiganbayan to hold that the Republic had not preponderantly shown that
the acts of dispossession and oppression had involved the improper use of her
influence by Luz Bakunawa on account of her close association with the
Marcoses.48
Concerning the negotiated construction contracts, the Republic posits that the
contracts had been entered into when Luz Bakunawa was a member of the
Presidential Staff during the Marcos administration, laying heavy emphasis on the
notations and handwritten instructions by President Marcos found on the written
communications from Manuel Bakunawa to then DPWH Secretary Baltazar Aquino.
Yet, the Republic offered the negotiated contracts solely to prove that the Bakunawas
had been incorporators or owners, or had held key positions in the corporations that
entered into the contracts.49 The Sandiganbayan correctly ruled, therefore, that the
contracts could be considered and appreciated only for those stated purposes, not for
the purpose of proving the irregularity of the contracts, opining as follows:
x x x. The documents appear to be public documents and are, therefore, considered
prima facie evidence of the fact of their issuance and that they were signed by the
persons whose signatures appear therein. It is, indeed, apparent on the face of the
documents that government projects were awarded to the defendants Bakunawas
through negotiated contracts, and that at least one was approved by then President
Marcos himself. Outside of these, however, there can be no other facts that can be
inferred from the aforesaid documents.50
The Court upholds the Sandiganbayan. It was basic enough that the Sandiganbayan
could not consider any evidence that was not formally offered; and could consider
evidence only for the purposes it was specifically offered. Section 34, Rule 132 of
the Rules of Court explicitly states:
Section 34. Offer of evidence. The court shall consider no evidence which has not
been formally offered. The purpose for which the evidence is offered must be
specified.
The need to formally offer evidence by specifying the purpose of the offer cannot be
overemphasized. This need is designed to meet the demand for due process by
apprising the adverse party as well as the trial court on what evidence the court
would soon be called upon to decide the litigation. The offer and purpose will also
put the trial court in the position to determine which rules of evidence it shall apply

in admitting or denying admission to the evidence being offered. According to Union


Bank of the Philippines v. Tiu:51
x x x a formal offer is necessary because judges are mandated to rest their findings of
facts and their judgment only and strictly upon the evidence offered by the parties at
the trial. It has several functions: (1) to enable the trial judge to know the purpose or
purposes for which the proponent is presenting the evidence; (2) to allow opposing
parties to examine the evidence and object to its admissibility; and (3) to facilitate
review by the appellate court, which will not be required to review documents not
previously scrutinized by the trial court. x x x.
Expounding on the office of the offer and statement of the purposes, the Court has
cogently said in Candido v. Court of Appeals:52
A document, or any article for that matter, is not evidence when it is simply marked
for identification; it must be formally offered, and the opposing counsel given an
opportunity to object to it or cross-examine the witness called upon to prove or
identify it. A formal offer is necessary since judges are required to base their findings
of fact and judgment only - and strictly - upon the evidence offered by the parties at
the trial. To allow a party to attach any document to his pleading and then expect the
court to consider it as evidence may draw unwarranted consequences. The opposing
party will be deprived of his chance to examine the document and object to its
admissibility. The appellate court will have difficulty reviewing documents not
previously scrutinized by the court below. The pertinent provisions of the Revised
Rules of Court on the inclusion on appeal of documentary evidence or exhibits in the
records cannot be stretched as to include such pleadings or documents not offered at
the hearing of the case.
At any rate, the Court must point out that negotiated contracts are not per se illegal.
A negotiated contract is one that is awarded on the basis of a direct agreement
between the Government and the contractor, without going through the normal
procurement process, like obtaining the prior approval from another authority, or a
competitive bidding process. It is generally resorted to for convenience, or "when
time is of the essence, or where there is a lack of qualified bidders or contractors, or
where there is conclusive evidence that greater economy and efficiency would be
achieved."53 The Court has upheld the validity of a negotiated contract made
pursuant to law, like a negotiated contract entered into by a City Mayor pursuant to
the then existing Local Government Code,54 or a negotiated contract that eventually
redounded to the benefit of the general public, even if there was no specific covering
appropriation pursuant to COA rules,55 or a negotiated contract that was made due
to an emergency in the health sector,56 or a negotiated contract for long overdue
repair and renovation needed to provide better health services.57

153

Absent evidence proving that the negotiated construction contracts had been
irregularly entered into by the Bakunawas, or that the public had been thereby
prejudiced, it is pointless for the Court to declare their invalidity. On the contrary, the
Sandiganbayan correctly observed that the presumption of the validity of the
contracts prevailed.58
It is true that the recovery of ill-gotten wealth should be relentlessly pursued. But the
pursuit should not be mindless as to be oppressive towards anyone. Due process
requires that there be sufficient competent evidence of the asset being ill-gotten
wealth, and of the person or persons charged with the illegal acquisition of ill-gotten
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 196231

January 28, 2014

EMILIO A. GONZALES III, Petitioner,


vs.
OFFICE OF THE PRESIDENT OF THE PHILIPPINES, ACTING THROUGH
AND REPRESENTED BY EXECUTIVE SECRETARY PAQUITO N. OCHOA,
JR., SENIOR DEPUTY EXECUTIVE SECRETARY JOSE AMOR M.
AMORANDO, OFFICER-IN-CHARGE - OFFICE OF THE DEPUTY
EXECUTIVE SECRETARY FOR LEGAL AFFAIRS, ATTY. RONALDO A.
GERON, DIR. ROWENA TURINGAN-SANCHEZ, AND ATTY. CARLITO D.
CATAYONG, Respondents.

wealth being a close associate or subordinate of the Marcoses who took advantage of
such ties with the Marcoses to enrich themselves. In that effort, the Republic carries
the heavy burden of proof, and must discharge such burden fully; otherwise, the
effort would fail and fall.
WHEREFORE, we DENY the petition for review on certiorari for its lack of merit;
and AFFIRM the decision rendered on April 10, 2002, without pronouncements on
costs of suit.
SO ORDERED.
We resolve the Office of the President's (OP 's) motion for reconsideration of our
September 4, 2012 Decision1 which ruled on the petitions filed by Deputy
Ombudsman Emilio Gonzales III and Special Prosecutor Wendell Barreras-Sulit.
Their petitions challenged the constitutionality of Section 8(2) of Republic Act (RA)
No. 6770.2
In the challenged Decision, the Court upheld the constitutionality of Section 8(2) of
RA No. 6770 and ruled that the President has disciplinary jurisdiction over a Deputy
Ombudsman and a Special Prosecutor. The Court, however, reversed the OP ruling
that: (i) found Gonzales guilty of Gross Neglect of Duty and Grave Misconduct
constituting betrayal of public trust; and (ii) imposed on him the penalty of dismissal.
Sulit, who had not then been dismissed and who simply sought to restrain the
disciplinary proceedings against her, solely questioned the jurisdiction of the OP to
subject her to disciplinary proceedings. The Court affirmed the continuation of the
proceedings against her after upholding the constitutionality of Section 8(2) of RA
No. 6770.

x-----------------------x

The fallo of our assailed Decision reads:

G.R. No. 196232

WHEREFORE, in G.R. No. 196231, the decision of the Office of the President in
OP Case No. 1 O-J-460 is REVERSED and SET ASIDE. Petitioner Emilio A.
Gonzales III is ordered REINSTATED with payment of backwages corresponding to
the period of suspension effective immediately, even as the Office of the
Ombudsman is directed to proceed with the investigation in connection with the
above case against petitioner. In G.R. No. 196232, We AFFIRM the continuation of
OP-DC Case No. ll-B-003 against Special Prosecutor Wendell Barreras-Sulit for
alleged acts and omissions tantamount to culpable violation of the Constitution and a
betrayal of public trust, in accordance with Section 8(2) of the Ombudsman Act of
1989.3

WENDELL BARRERAS-SULIT Petitioner,


vs.
ATTY. PAQUITO N. OCHOA, JR., IN HIS CAP A CITY AS EXECUTIVE
SECRETARY, OFFICE OF THE PRESIDENT, ATTY. DENNIS F. ORTIZ, ATTY.
CARLO D. SULAY AND ATTY. FROILAN D. MONTALBAN, JR., IN THEIR
CAPACITIES AS CHAIRMAN AND MEMBERS OF OFFICE OF
MALACANANG LEGAL AFFAIRS, Respondents.
DECISION
BRION, J.:

In view of the Courts ruling, the OP filed the present motion for reconsideration
through the Office of the Solicitor General (OSG).

154

We briefly narrate the facts that preceded the filing of the petitions and the present
motion for reconsideration.
I. ANTECEDENTS
A. Gonzales petition (G.R. No. 196231)
a. Factual antecedents
On May 26, 2008, Christian Kalaw filed separate charges with the Philippine
National Police Internal Affairs Service (PNP-IAS) and with the Manila City
Prosecutors Office against Manila Police District Senior Inspector Rolando
Mendoza and four others (Mendoza, et al.) for robbery, grave threat, robbery
extortion and physical injury.4
On May 29, 2008, Police Senior Superintendent Atty. Clarence Guinto filed an
administrative charge for grave misconduct with the National Police Commission
(NAPOLCOM) PNP-NCRPO against Mendoza, et al. based on the same allegations
made by Kalaw before the PNP-IAS.5
On July 2, 2008, Gonzales, Deputy Ombudsman for Military and Other Law
Enforcement Officers (MOLEO), directed the NAPOLCOM to turn over the records
of Mendozas case to his office. The Office of the Regional Director of the
NAPOLCOM duly complied on July 24, 2008.6 Mendoza, et al. filed their position
papers with Gonzales, in compliance with his Order.7
Pending Gonzales action on Mendoza, et al.s case (on August 26, 2008), the
Office of the City Prosecutor of Manila City dismissed Kalaws complaint against
Mendoza, et al. for his failure to substantiate his allegations.8 Similarly, on October
17, 2008, the PNP-IAS recommended the dismissal without prejudice of the
administrative case against Mendoza, et al. for Kalaws failure to prosecute.9

On December 10, 2009, the MOLEO-Records Section forwarded Mendoza, et al.s


case records to the Criminal Investigation, Prosecution and Administrative BureauMOLEO. On December 14, 2009, the case was assigned to Graft Investigation and
Prosecution Officer (GIPO) Dennis Garcia for review and recommendation.14
GIPO Garcia released a draft order15 to his immediate superior, Director Eulogio
S. Cecilio, for appropriate action on April 5, 2010. Dir. Cecilio signed and forwarded
the draft order to Gonzales office on April 27, 2010. Gonzales reviewed the draft
and endorsed the order, together with the case records, on May 6, 2010 for the final
approval by the Ombudsman.16
On August 23, 2010, pending final action by the Ombudsman on Mendoza, et al.s
case, Mendoza hijacked a tourist bus and held the 21 foreign tourists and the four
Filipino tour assistants on board as hostages. While the government exerted earnest
attempts to peacefully resolve the hostage-taking, it ended tragically, resulting in the
deaths of Mendoza and several others on board the hijacked bus.
In the aftermath, President Benigno C. Aquino III directed the Department of
Justice and the Department of Interior and Local Government to conduct a joint
thorough investigation of the incident. The two departments issued Joint Department
Order No. 01-2010, creating an Incident Investigation and Review Committee
(IIRC).
In its September 16, 2010 First Report, the IIRC found the Ombudsman and
Gonzales accountable for their "gross negligence and grave misconduct in handling
the case against Mendoza."17 The IIRC stated that the Ombudsman and Gonzales
failure to promptly resolve Mendozas motion for reconsideration, "without
justification and despite repeated pleas" xxx "precipitated the desperate resort to
hostage-taking."18 The IIRC recommended the referral of its findings to the OP for
further determination of possible administrative offenses and for the initiation of the
proper administrative proceedings.19

On February 16, 2009, after preparing a draft decision on Mendoza, et al.s case,
Gonzales forwarded the entire records to the Office of then Ombudsman Merceditas
Gutierrez for her review.10 In his draft decision, Gonzales found Mendoza, et al.
guilty of grave misconduct and imposed on them the penalty of dismissal from the
service.11

Accordingly, on October 15, 2010, Gonzales was formally charged before the OP
for Gross Neglect of Duty and/or Inefficiency in the Performance of Official Duty
and for Misconduct in Office.20

Mendoza, et al. received a copy of the Ombudsmans decision that approved


Gonzales recommendation on October 30, 2009. Mendoza, et al. filed a motion for
reconsideration12 on November 5, 2009, followed by a Supplement to the Motion
for Reconsideration.13

On March 31, 2011, the OP found Gonzales guilty as charged and dismissed him
from the service.21 According to the OP, "the inordinate and unjustified delay in the
resolution of [Mendozas] Motion for Reconsideration [that spanned for nine (9)
long months] xxx amounted to gross neglect of duty" and "constituted a flagrant
disregard of the Office of the Ombudsmans own Rules of Procedure."22

b. The OP ruling

155

c. The Petition
Gonzales posited in his petition that the OP has no administrative disciplinary
jurisdiction over a Deputy Ombudsman. Under Section 21 of RA No. 6770, it is the
Ombudsman who exercises administrative disciplinary jurisdiction over the Deputy
Ombudsman.
On the merits, Gonzales argued that his office received the draft order from GIPO
Garcia on April 27, 2010. On May 6, 2010, he completed his review of the draft,
approved it, and transmitted it to the Office of the Ombudsman for final approval.
Since the draft order on Mendozas motion for reconsideration had to undergo
different levels of preparation, review and approval, the period it took to resolve the
motion could not be unjustified, since he himself acted on the draft order only within
nine (9) calendars days from his receipt of the order.23
B. Sulits petition (G.R. No. 196232)
In April 2005, the Office of the Ombudsman charged Major General Carlos F.
Garcia and several others, before the Sandiganbayan, with plunder and money
laundering. On May 7, 2007, Garcia filed an Urgent Petition for Bail which the
prosecution opposed. The Sandiganbayan denied Garcia's urgent petition for bail on
January 7, 2010, in view of the strength of the prosecutions evidence against Garcia.
On February 25, 2010, the Office of the Ombudsman, through Sulit and her
prosecutorial staff, entered into a plea bargaining agreement (Agreement) with
Garcia.24 Garcia thereby agreed to: (i) withdraw his plea of not guilty to the charge
of plunder and enter a plea of guilty to the lesser offense of indirect bribery; and (ii)
withdraw his plea of not guilty to the charge of money laundering and enter a guilty
plea to the lesser offense of facilitating money laundering. In exchange, he would
convey to the government his ownership, rights and other interests over the real and
personal properties enumerated in the Agreement and the bank deposits alleged in
the information.25
The Sandiganbayan approved the Agreement on May 4, 201026 based on the
parties submitted Joint Motion for Approval.27
The apparent one-sidedness of the Agreement drew public outrage and prompted
the Committee on Justice of the House of Representatives to conduct an
investigation. After public hearings, the Committee found that Sulit, her deputies and
assistants committed culpable violations of the Constitution and betrayal of public
trust grounds for removal under Section 8(2) of RA No. 6770.28 The Committee
recommended to the President the dismissal from the service of Sulit and the filing
of appropriate charges against her deputies and assistants before the appropriate
government office.

Accordingly, the OP initiated an administrative disciplinary proceeding against


Sulit.29 On March 24, 2011, Sulit filed her Written Explanation, questioning the
OPs jurisdiction.30 The question of jurisdiction notwithstanding, the OP set the case
for preliminary investigation on April 15, 2011, prompting Sulit to seek relief from
this Court.
II. COURTS RULING
On motion for reconsideration and further reflection, the Court votes to grant
Gonzales petition and to declare Section 8(2) of RA No. 6770 unconstitutional with
respect to the Office of the Ombudsman. (As the full explanation of the Courts vote
describes below, this conclusion does not apply to Sulit as the grant of independence
is solely with respect to the Office of the Ombudsman which does not include the
Office of the Special Prosecutor under the Constitution. The prevailing ruling on this
latter point is embodied in the Concurring and Dissenting Opinion of J. Marvic
Mario Victor Leonen).
A. Preliminary considerations:
a. Absence of motion for reconsideration on the part of the petitioners
At the outset, the Court notes that Gonzales and Sulit did not file a motion for
reconsideration of the Courts September 4, 2012 Decision; only the OP, through the
OSG, moved for the reconsideration of our ruling reinstating Gonzales.
This omission, however, poses no obstacle for the Courts review of its ruling on
the whole case since a serious constitutional question has been raised and is one of
the underlying bases for the validity or invalidity of the presidential action. If the
President does not have any constitutional authority to discipline a Deputy
Ombudsman and/or a Special Prosecutor in the first place, then any ruling on the
legal correctness of the OPs decision on the merits will be an empty one.
In other words, since the validity of the OPs decision on the merits of the
dismissal is inextricably anchored on the final and correct ruling on the constitutional
issue, the whole case including the constitutional issue remains alive for the
Courts consideration on motion for reconsideration.
b. The justiciability of the constitutional
issue raised in the petitions
We clarify, too, that the issue of whether a Deputy Ombudsman may be subjected
to the administrative disciplinary jurisdiction of the President (concurrently with that

156

of the Ombudsman) is a justiciable not a political question. A justiciable question


is one which is inherently susceptible of being decided on grounds recognized by
law,31 as where the court finds that there are constitutionally-imposed limits on the
exercise of the powers conferred on a political branch of the government.32
In resolving the petitions, we do not inquire into the wisdom of the Congress
choice to grant concurrent disciplinary authority to the President. Our inquiry is
limited to whether such statutory grant violates the Constitution, particularly whether
Section 8(2) of RA No. 6770 violates the core constitutional principle of the
independence of the Office of the Ombudsman as expressed in Section 5, Art. XI of
the Constitution.
To be sure, neither the Executive nor the Legislative can create the power that
Section 8(2) of RA No. 6770 grants where the Constitution confers none. When
exercised authority is drawn from a vacuum, more so when the authority runs
counter to a core constitutional principle and constitutional intents, the Court is dutybound to intervene under the powers and duties granted and imposed on it by Article
VIII of the Constitution.

expressly and constitutionally guaranteed. Its objectives are to enforce the state
policy in Section 27, Article II35 and the standard of accountability in public service
under Section 1, Article XI of the 1987 Constitution. These provisions read:
Section 27. The State shall maintain honesty and integrity in the public service and
take positive and effective measures against graft and corruption.
Section 1. Public office is a public trust. Public officers and employees must, at all
times, be accountable to the people, serve them with utmost responsibility, integrity,
loyalty, and efficiency; act with patriotism and justice, and lead modest lives.
Under Section 12, Article XI of the 1987 Constitution, the Office of the
Ombudsman is envisioned to be the "protector of the people" against the inept,
abusive, and corrupt in the Government, to function essentially as a complaints and
action bureau.36 This constitutional vision of a Philippine Ombudsman practically
intends to make the Ombudsman an authority to directly check and guard against the
ills, abuses and excesses of the bureaucracy. Pursuant to Section 13(8), Article XI of
the 1987 Constitution, Congress enacted RA No. 6770 to enable it to further realize
the vision of the Constitution. Section 21 of RA No. 6770 provides:

B. The Deputy Ombudsman: Constitutional Issue


a. The Philippine Ombudsman
Prior to the 1973 Constitution, past presidents established several Ombudsmanlike agencies to serve as the people's medium for airing grievances and for direct
redress against abuses and misconduct in the government. Ultimately, however, these
agencies failed to fully realize their objective for lack of the political independence
necessary for the effective performance of their function as government critic.33
It was under the 1973 Constitution that the Office of the Ombudsman became a
constitutionally-mandated office to give it political independence and adequate
powers to enforce its mandate. Pursuant to the 1973 Constitution, President
Ferdinand Marcos enacted Presidential Decree (PD) No. 1487, as amended by PD
No. 1607 and PD No. 1630, creating the Office of the Ombudsman to be known as
Tanodbayan. It was tasked principally to investigate, on complaint or motu proprio,
any administrative act of any administrative agency, including any governmentowned or controlled corporation. When the Office of the Tanodbayan was
reorganized in 1979, the powers previously vested in the Special Prosecutor were
transferred to the Tanodbayan himself. He was given the exclusive authority to
conduct preliminary investigation of all cases cognizable by the Sandiganbayan, file
the corresponding information, and control the prosecution of these cases.34
With the advent of the 1987 Constitution, a new Office of the Ombudsman was
created by constitutional fiat. Unlike in the 1973 Constitution, its independence was

Section 21. Official Subject to Disciplinary Authority; Exceptions. The Office


of the Ombudsman shall have disciplinary authority over all elective and appointive
officials of the Government and its subdivisions, instrumentalities and agencies,
including Members of the Cabinet, local government, government-owned or
controlled corporations and their subsidiaries, except over officials who may be
removed only by impeachment or over Members of Congress, and the Judiciary.
[emphasis ours, italics supplied]
As the Ombudsman is expected to be an "activist watchman,"37 the Court has
upheld its actions, although not squarely falling under the broad powers granted it by
the Constitution and by RA No. 6770, if these actions are reasonably in line with its
official function and consistent with the law and the Constitution.38
The Ombudsmans broad investigative and disciplinary powers include all acts of
malfeasance, misfeasance, and nonfeasance of all public officials, including
Members of the Cabinet and key Executive officers, during their tenure. To support
these broad powers, the Constitution saw it fit to insulate the Office of the
Ombudsman from the pressures and influence of officialdom and partisan politics
and from fear of external reprisal by making it an "independent" office. Section 5,
Article XI of the Constitution expressed this intent, as follows:
Section 5. There is hereby created the independent Office of the Ombudsman,
composed of the Ombudsman to be known as Tanodbayan, one overall Deputy and at

157

least one Deputy each for Luzon, Visayas, and Mindanao. A separate Deputy for the
military establishment may likewise be appointed. [emphasis ours]
Given the scope of its disciplinary authority, the Office of the Ombudsman is a
very powerful government constitutional agency that is considered "a notch above
other grievance-handling investigative bodies."39 It has powers, both constitutional
and statutory, that are commensurate with its daunting task of enforcing
accountability of public officers.40
b. "Independence" of constitutional bodies vis-a-vis the Ombudsmans
independence
Under the Constitution, several constitutional bodies have been expressly labeled
as "independent."41 The extent of the independence enjoyed by these constitutional
bodies however varies and is to be interpreted with two significant considerations in
mind: first, the functions performed or the powers involved in a given case; and
second, consistency of any allowable interference to these powers and functions,
with the principle of checks and balances.
Notably, the independence enjoyed by the Office of the Ombudsman and by the
Constitutional Commissions shares certain characteristics they do not owe their
existence to any act of Congress, but are created by the Constitution itself;
additionally, they all enjoy fiscal autonomy. In general terms, the framers of the
Constitution intended that these "independent" bodies be insulated from political
pressure to the extent that the absence of "independence" would result in the
impairment of their core functions.
In Bengzon v. Drilon,42 involving the fiscal autonomy of the Judiciary, we ruled
against the interference that the President may bring and maintained that the
independence and the flexibility of the Judiciary, the Constitutional Commissions
and the Office of the Ombudsman are crucial to our legal system.
The Judiciary, the Constitutional Commissions, and the Ombudsman must have
the independence and flexibility needed in the discharge of their constitutional
duties. The imposition of restrictions and constraints on the manner the independent
constitutional offices allocate and utilize the funds appropriated for their operations
is anathema to fiscal autonomy and violative not only the express mandate of the
Constitution but especially as regards the Supreme Court, of the independence and
separation of powers upon which the entire fabric of our constitutional system is
based.
The constitutional deliberations explain the Constitutional Commissions need for
independence. In the deliberations of the 1973 Constitution, the delegates amended
the 1935 Constitution by providing for a constitutionally-created Civil Service

Commission, instead of one created by law, on the premise that the effectivity of this
body is dependent on its freedom from the tentacles of politics.43 In a similar
manner, the deliberations of the 1987 Constitution on the Commission on Audit
highlighted the developments in the past Constitutions geared towards insulating the
Commission on Audit from political pressure.44
Notably, the Constitution also created an "independent" Commission on Human
Rights, although it enjoys a lesser degree of independence since it is not granted
fiscal autonomy in the manner fiscal autonomy is granted to the constitutional
commissions. The lack of fiscal autonomy notwithstanding, the framers of the 1987
Constitution clearly expressed their desire to keep the Commission independent from
the executive branch and other political leaders:
MR. MONSOD. We see the merits of the arguments of Commissioner Rodrigo. If
we explain to him our concept, he can advise us on how to reconcile his position
with ours. The position of the committee is that we need a body that would be able to
work and cooperate with the executive because the Commissioner is right. Many of
the services needed by this commission would need not only the cooperation of the
executive branch of the government but also of the judicial branch of government.
This is going to be a permanent constitutional commission over time. We also want a
commission to function even under the worst circumstance when the executive may
not be very cooperative. However, the question in our mind is: Can it still function
during that time? Hence, we are willing to accept suggestions from Commissioner
Rodrigo on how to reconcile this. We realize the need for coordination and
cooperation. We also would like to build in some safeguards that it will not be
rendered useless by an uncooperative executive.
xxxx
MR. GARCIA. xxx Very often, when international commissions or organizations
on human rights go to a country, the most credible organizations are independent
human rights bodies. Very often these are private organizations, many of which are
prosecuted, such as those we find in many countries in Latin America. In fact, what
we are proposing is an independent body on human rights, which would provide
governments with credibility precisely because it is independent of the present
administration. Whatever it says on the human rights situation will be credible
because it is not subject to pressure or control from the present political leadership.
Secondly, we all know how political fortunes come and go. Those who are in
power yesterday are in opposition today and those who are in power today may be in
the opposition tomorrow. Therefore, if we have a Commission on Human Rights that
would investigate and make sure that the rights of each one is protected, then we
shall have a body that could stand up to any power, to defend the rights of
individuals against arrest, unfair trial, and so on.45

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These deliberative considerations abundantly show that the independent


constitutional commissions have been consistently intended by the framers to be
independent from executive control or supervision or any form of political influence.
At least insofar as these bodies are concerned, jurisprudence is not scarce on how the
"independence" granted to these bodies prevents presidential interference.
In Brillantes, Jr. v. Yorac,46 we emphasized that the Constitutional Commissions,
which have been characterized under the Constitution as "independent," are not
under the control of the President, even if they discharge functions that are executive
in nature. The Court declared as unconstitutional the Presidents act of temporarily
appointing the respondent in that case as Acting Chairman of the Comelec "however
well-meaning"47 it might have been.
In Bautista v. Senator Salonga,48 the Court categorically stated that the tenure of
the commissioners of the independent Commission on Human Rights could not be
placed under the discretionary power of the President:
Indeed, the Court finds it extremely difficult to conceptualize how an office
conceived and created by the Constitution to be independent as the Commission on
Human Rights and vested with the delicate and vital functions of investigating
violations of human rights, pinpointing responsibility and recommending sanctions
as well as remedial measures therefor, can truly function with independence and
effectiveness, when the tenure in office of its Chairman and Members is made
dependent on the pleasure of the President. Executive Order No. 163-A, being
antithetical to the constitutional mandate of independence for the Commission on
Human Rights has to be declared unconstitutional.
Again, in Atty. Macalintal v. Comelec,49 the Court considered even the mere
review of the rules of the Commission on Elections by Congress a "trampling" of the
constitutional mandate of independence of this body. Obviously, the mere review of
rules places considerably less pressure on a constitutional body than the Executives
power to discipline and remove key officials of the Office of the Ombudsman, yet
the Court struck down the law as unconstitutional.
The kind of independence enjoyed by the Office of the Ombudsman certainly
cannot be inferior but is similar in degree and kind to the independence similarly
guaranteed by the Constitution to the Constitutional Commissions since all these
offices fill the political interstices of a republican democracy that are crucial to its
existence and proper functioning.50
c. Section 8(2) of RA No. 6770
vesting disciplinary authority
in the President over the

Deputy Ombudsman violates


the independence of the Office
of the Ombudsman and is thus
unconstitutional
Our discussions, particularly the Courts expressed caution against presidential
interference with the constitutional commissions, on one hand, and those expressed
by the framers of the 1987 Constitution, on the other, in protecting the independence
of the Constitutional Commissions, speak for themselves as overwhelming reasons to
invalidate Section 8(2) of RA No. 6770 for violating the independence of the Office
of the Ombudsman.
In more concrete terms, we rule that subjecting the Deputy Ombudsman to
discipline and removal by the President, whose own alter egos and officials in the
Executive Department are subject to the Ombudsmans disciplinary authority, cannot
but seriously place at risk the independence of the Office of the Ombudsman itself.
The Office of the Ombudsman, by express constitutional mandate, includes its key
officials, all of them tasked to support the Ombudsman in carrying out her mandate.
Unfortunately, intrusion upon the constitutionally-granted independence is what
Section 8(2) of RA No. 6770 exactly did. By so doing, the law directly collided not
only with the independence that the Constitution guarantees to the Office of the
Ombudsman, but inevitably with the principle of checks and balances that the
creation of an Ombudsman office seeks to revitalize.
What is true for the Ombudsman must be equally and necessarily true for her
Deputies who act as agents of the Ombudsman in the performance of their duties.
The Ombudsman can hardly be expected to place her complete trust in her
subordinate officials who are not as independent as she is, if only because they are
subject to pressures and controls external to her Office. This need for complete trust
is true in an ideal setting and truer still in a young democracy like the Philippines
where graft and corruption is still a major problem for the government. For these
reasons, Section 8(2) of RA No. 6770 (providing that the President may remove a
Deputy Ombudsman) should be declared void.
The deliberations of the Constitutional Commission on the independence of the
Ombudsman fully support this position. Commissioner Florenz Regalado of the
Constitutional Commission expressed his apprehension that any form of presidential
control over the Office of the Ombudsman would diminish its independence.51 The
following exchanges between Commissioners Blas Ople and Christian Monsod
further reveal the constitutional intent to keep the Office of the Ombudsman
independent from the President:
MR. OPLE. xxx

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May I direct a question to the Committee? xxx [W]ill the Committee consider later
an amendment xxx, by way of designating the office of the Ombudsman as a
constitutional arm for good government, efficiency of the public service and the
integrity of the President of the Philippines, instead of creating another agency in a
kind of administrative limbo which would be accountable to no one on the pretext
that it is a constitutional body?
MR. MONSOD. The Committee discussed that during our committee
deliberations and when we prepared the report, it was the opinion of the Committee
and I believe it still is that it may not contribute to the effectiveness of this
office of the Ombudsman precisely because many of the culprits in inefficiency,
injustice and impropriety are in the executive department. Therefore, as we saw the
wrong implementation of the Tanodbayan which was under the tremendous influence
of the President, it was an ineffectual body and was reduced to the function of a
special fiscal. The whole purpose of our proposal is precisely to separate those
functions and to produce a vehicle that will give true meaning to the concept of
Ombudsman. Therefore, we regret that we cannot accept the proposition.52
The statements made by Commissioner Monsod emphasized a very logical
principle: the Executive power to remove and discipline key officials of the Office of
the Ombudsman, or to exercise any power over them, would result in an absurd
situation wherein the Office of the Ombudsman is given the duty to adjudicate on the
integrity and competence of the very persons who can remove or suspend its
members. Equally relevant is the impression that would be given to the public if the
rule were otherwise. A complainant with a grievance against a high-ranking official
of the Executive, who appears to enjoy the Presidents favor, would be discouraged
from approaching the Ombudsman with his complaint; the complainants impression
(even if misplaced), that the Ombudsman would be susceptible to political pressure,
cannot be avoided. To be sure, such an impression would erode the constitutional
intent of creating an Office of the Ombudsman as champion of the people against
corruption and bureaucracy.
d. The mutual-protection argument for
crafting Section 8(2)of RA No. 6770
In crafting Section 8(2) of RA No. 6770, Congress apparently addressed the
concern that a lack of an external check against the Deputy Ombudsman would result
in mutual protection between the Ombudsman and her Deputies.
While the preceding discussion already suffices to address this concern, it should
be added that this concern stands on shaky grounds since it ignores the existing
checks and balances already in place. On the one hand, the Ombudsmans Deputies
cannot protect the Ombudsman because she is subject to the impeachment power of
Congress. On the other hand, the Ombudsmans attempt to cover up the misdeeds of

her Deputies can be questioned before the Court on appeal or certiorari. The same
attempt can likewise subject her to impeachment.
The judicial recourse available is only consistent with the nature of the Supreme
Court as a non-political independent body mandated by the Constitution to settle
judicial and quasi-judicial disputes, whose judges and employees are not subject to
the disciplinary authority of the Ombudsman and whose neutrality would be less
questionable. The Members of the Court themselves may be subjected to the
impeachment power of Congress.
In these lights, the appeal, if any, of the mutual protection argument becomes
distinctly implausible. At the same time, the Court remains consistent with its
established rulings - that the independence granted to the Constitutional
Commissions bars any undue interference from either the Executive or Congress
and is in full accord with constitutional intent.
e. Congress power determines the
manner and causes for the removal
of non-impeachable officers is not a
carte blanch authority
Under Section 2, Article XI of the 1987 Constitution,53 Congress is empowered to
determine the modes of removal from office of all public officers and employees
except the President, the Vice-President, the Members of the Supreme Court, the
Members of the Constitutional Commissions, and the Ombudsman, who are all
impeachable officials.
The intent of the framers of the Constitution in providing that "[a]ll other public
officers and employees may be removed from office as provided by law, but not by
impeachment" in the second sentence of Section 2, Article XI is to prevent Congress
from extending the more stringent rule of "removal only by impeachment" to favored
public officers.54 Understandably so, impeachment is the most difficult and
cumbersome mode of removing a public officer from office. It is, by its nature, a sui
generis politico-legal process55 that signals the need for a judicious and careful
handling as shown by the process required to initiate the proceeding;56 the one-year
limitation or bar for its initiation;57 the limited grounds for impeachment;58 the
defined instrumentality given the power to try impeachment cases;59 and the number
of votes required for a finding of guilt.60 All these argue against the extension of this
removal mechanism beyond those mentioned in the Constitution.
On the practical side, our nation has witnessed the complications and problems an
impeachment proceeding entails, thus justifying its limited application only to the
officials occupying the highest echelons of responsibility in our government. To
name a few, some of the negative practical effects of impeachment are: it stalls

160

legislative work; it is an expensive process in terms of the cost of prosecution alone;


and, more importantly, it is inherently divisive of the nation.61 Thus, in a costbenefit analysis of adopting impeachment as a mechanism, limiting Congress power
to otherwise legislate on the matter is far more advantageous to the country.
It is in these lights that the second sentence in Section 2, Article XI of the 1987
Constitution should be read. Contrary to the implied view of the minority, in no way
can this provision be regarded as blanket authority for Congress to provide for any
ground of removal it deems fit. While the manner and cause of removal are left to
congressional determination, this must still be consistent with constitutional
guarantees and principles, namely: the right to procedural and substantive due
process; the constitutional guarantee of security of tenure; the principle of separation
of powers; and the principle of checks and balances.62
In short, the authority granted by the Constitution to Congress to provide for the
manner and cause of removal of all other public officers and employees does not
mean that Congress can ignore the basic principles and precepts established by the
Constitution.
In the same manner, the congressional determination of the identity of the
disciplinary authority is not a blanket authority for Congress to repose it on
whomsoever Congress chooses without running afoul of the independence enjoyed
by the Office of the Ombudsman and without disrupting the delicate check and
balance mechanism under the Constitution. Properly viewed from this perspective,
the core constitutional principle of independence is observed and any possible
absurdity resulting from a contrary interpretation is avoided. In other words, while
the Constitution itself vested Congress with the power to determine the manner and
cause of removal of all non-impeachable officials, this power must be interpreted
consistent with the core constitutional principle of independence of the Office of the
Ombudsman. Our observation in Macalintal v. Comelec63 is apt:
The ambit of legislative power under Article VI of the Constitution is
circumscribed by other constitutional provisions. One such provision is Section 1 of
Article IX-A of the 1987 Constitution ordaining that constitutional commissions such
as the COMELEC shall be "independent."
While one may argue that the grounds for impeachment under Section 8(2) of RA
No. 6770 is intended as a measure of protection for the Deputy Ombudsman and
Special Prosecutor since these grounds are not intended to cover all kinds of
official wrongdoing and plain errors of judgment - this argument seriously overlooks
the erosion of the independence of the Office of the Ombudsman that it creates. The
mere fact that a statutorily-created sword of Damocles hangs over the Deputy
Ombudsmans head, by itself, opens up all the channels for external pressures and
influence of officialdom and partisan politics. The fear of external reprisal from the

very office he is to check for excesses and abuses defeats the very purpose of
granting independence to the Office of the Ombudsman.
That a judicial remedy is available (to set aside dismissals that do not conform to
the high standard required in determining whether a Deputy Ombudsman committed
an impeachable offense) and that the Presidents power of removal is limited to
specified grounds are dismally inadequate when balanced with the constitutional
principle of independence. The mere filing of an administrative case against the
Deputy Ombudsman and the Special Prosecutor before the OP can already result in
their suspension and can interrupt the performance of their functions, in violation of
Section 12, Article XI of the Constitution. With only one term allowed under Section
11, a Deputy Ombudsman or Special Prosecutor, if removable by the President, can
be reduced to the very same ineffective Office of the Ombudsman that the framers
had foreseen and carefully tried to avoid by making these offices independent
constitutional bodies.
At any rate, even assuming that the OP has disciplinary authority over the Deputy
Ombudsman, its decision finding Gonzales guilty of Gross Neglect of Duty and
Grave Misconduct constituting betrayal of public trust is patently erroneous. The
OPs decision perfectly illustrates why the requirement of impeachment-grounds in
Section 8(2) of RA No. 6770 cannot be considered, even at a minimum, a measure of
protection of the independence of the Office of the Ombudsman.
C. The Deputy Ombudsman: The Dismissal Issue
a. The Office of the Presidents
finding of gross negligence
has no legal and factual leg to
stand on
The OPs decision found Gonzales guilty of Gross Neglect of Duty and of Grave
Misconduct. The assailed Decision of the OP reads:
Upon consideration of the First Report, the evidence and allegations of respondent
Deputy Ombudsman himself, and other documentary evidence gathered, this Office
finds that the inordinate and unjustified delay in the resolution of Captain Mendozas
Motion for Reconsideration timely filed on 5 November 2009 xxx amounted to gross
neglect of duty and/or inefficiency in the performance of official duty.64
b. No gross neglect of duty or inefficiency
Let us again briefly recall the facts.

161

1. November 5, 2009 - Mendoza filed a Motion for Reconsideration of the


decision of the Ombudsman,65 which was followed by a Supplement to the Motion
for Reconsideration;66

Only one motion for reconsideration or reinvestigation shall be allowed, and the
Hearing Officer shall resolve the same within five (5) days from the date of
submission for resolution. [emphasis and underscore ours]

2. December 14, 200967 - GIPO Garcia, who was assigned to review these
motions and make his recommendation for the appropriate action, received the
records of the case;

Even if we consider this provision to be mandatory, the period it requires cannot


apply to Gonzales since he is a Deputy Ombudsman whose obligation is to review
the case; he is not simply a Hearing Officer tasked with the initial resolution of the
motion. In Section 6 of Administrative Order No. 7 on the resolution of the case and
submission of the proposed decision, the period for resolving the case does not cover
the period within which it should be reviewed:

3. April 5, 2010 GIPO Garcia released a draft order to be reviewed by his


immediate superior, Dir. Cecilio;68
4. April 27, 2010 Dir. Cecilio signed and forwarded to Gonzales this draft
order;69
5. May 6, 2010 (or nine days after the records were forwarded to Gonzales)
Gonzales endorsed the draft order for the final approval of the Ombudsman.70
Clearly, when Mendoza hijacked the tourist bus on August 23, 2010, the records of
the case were already pending before Ombudsman Gutierrez.
Gross negligence refers to negligence characterized by the want of even the
slightest care, acting or omitting to act in a situation where there is a duty to act, not
inadvertently but willfully and intentionally, with a conscious indifference to
consequences insofar as other persons may be affected. In the case of public
officials, there is gross negligence when a breach of duty is flagrant and palpable.71

Section 6. Rendition of decision. Not later than thirty (30) days after the case is
declared submitted for resolution, the Hearing Officer shall submit a proposed
decision containing his findings and recommendation for the approval of the
Ombudsman. Said proposed decision shall be reviewed by the Directors, Assistant
Ombudsmen and Deputy Ombudsmen concerned. With respect to low ranking public
officials, the Deputy Ombudsman concerned shall be the approving authority. Upon
approval, copies thereof shall be served upon the parties and the head of the office or
agency of which the respondent is an official or employee for his information and
compliance with the appropriate directive contained therein. [italics and emphases
supplied]
Thus, the OPs ruling that Gonzales had been grossly negligent for taking nine
days, instead of five days, to review a case was totally baseless.
c. No actionable failure to supervise subordinates

Gonzales cannot be guilty of gross neglect of duty and/or inefficiency since he


acted on the case forwarded to him within nine days. In finding Gonzales guilty, the
OP72 relied on Section 8, Rule III of Administrative Order No. 7 (or the Rules of
Procedure of the Office of the Ombudsman, series of 1990, as amended) in ruling
that Gonzales should have acted on Mendozas Motion for Reconsideration within
five days:
Section 8. Motion for reconsideration or reinvestigation: Grounds Whenever
allowable, a motion for reconsideration or reinvestigation may only be entertained if
filed within ten (10) days from receipt of the decision or order by the party on the
basis of any of the following grounds:
a) New evidence had been discovered which materially affects the order, directive
or decision;
b) Grave errors of facts or laws or serious irregularities have been committed
prejudicial to the interest of the movant.

The OPs claims that Gonzales could have supervised his subordinates to promptly
act on Mendozas motion and apprised the Tanodbayan of the urgency of resolving
the same are similarly groundless.
The Office of the Ombudsman is not a corner office in our bureaucracy. It handles
numerous cases that involve the potential loss of employment of many other public
employees. We cannot conclusively state, as the OP appears to suggest, that
Mendozas case should have been prioritized over other similar cases.
The Court has already taken judicial notice of the steady stream of cases reaching
the Office of the Ombudsman.73 This consideration certainly militates against the
OSGs observation that there was "a grossly inordinate and inexcusable delay"74 on
the part of Gonzales.
Equally important, the constitutional guarantee of "speedy disposition of cases"
before, among others, quasi-judicial bodies,75 like the Office of the Ombudsman, is
itself a relative concept.76 Thus, the delay, if any, must be measured in this objective

162

constitutional sense. Unfortunately, because of the very statutory grounds relied upon
by the OP in dismissing Gonzales, the political and, perhaps, "practical"
considerations got the better of what is legal and constitutional.
The facts do not show that Gonzales subordinates had in any way been grossly
negligent in their work. While GIPO Garcia reviewed the case and drafted the order
for more than three months, it is noteworthy that he had not drafted the initial
decision and, therefore, had to review the case for the first time.77 Even the
Ombudsman herself could not be faulted for acting on a case within four months,
given the amount of cases that her office handles.
The point is that these are not inordinately long periods for the work involved:
examination of the records, research on the pertinent laws and jurisprudence, and
exercise of legal judgment and discretion. If this Court rules that these periods per se
constitute gross neglect of duty, the Ombudsmans constitutional mandate to
prosecute all the erring officials of this country would be subjected to an
unreasonable and overwhelming constraint. Similarly, if the Court rules that these
periods per se constitute gross neglect of duty, then we must be prepared to reconcile
this with the established concept of the right of speedy disposition of cases
something the Court may be hard put to justify.
d. No undue interest
The OP also found Gonzales guilty of showing undue interest in Mendozas case
by having the case endorsed to the Office of the Ombudsman and by resolving it
against Mendoza on the basis of the unverified complaint-affidavit of the alleged
victim, Kalaw.
The fact that Gonzales had Mendozas case endorsed to his office lies within his
mandate, even if it were based merely on the request of the alleged victims father.
The Constitution empowers the Ombudsman and her Deputies to act promptly on
complaints filed in any form or manner against any public official or employee of the
government.78 This provision is echoed by Section 13 of RA No. 6770,79 and by
Section 3, Rule III of Administrative Order No. 7, series of 1990, as amended.80
Moreover, Gonzales and his subordinates did not resolve the complaint only on
the basis of the unverified affidavit of Kalaw. Based on the prosecution officers
recommendations, the finding of guilt on the part of Mendoza, et al. was based on
their admissions as well. Mendoza, et al. admitted that they had arrested Kalaw
based on two traffic violations and allowed him to stay the whole night until the
following morning in the police precinct. The next morning, Kalaw was allowed to
leave the precinct despite his failure to show a valid license and based merely on his
promise to return with the proper documents.81 These admissions led Gonzales and
his staff to conclude that Mendoza, et al. irregularly acted in apprehending Kalaw,

since the proper procedure for the apprehension of traffic violators would be to give
them a ticket and to file a case, when appropriate.82
Lastly, we cannot deduce undue interest simply because Gonzales decision differs
from the decision of the PNP-IAS (which dismissed the complaint against Mendoza).
To be sure, we cannot tie the hands of any judicial or quasi-judicial body by ruling
that it should always concur with the decisions of other judicial or quasi-judicial
bodies which may have also taken cognizance of the case. To do so in the case of a
Deputy Ombudsman would be repugnant to the independence that our Constitution
has specifically granted to this office and would nullify the very purpose for which it
was created.
e. Penalty of dismissal totally
incommensurate with established facts
Given the lack of factual basis for the charges against Gonzales, the penalty of
removal imposed by the OP necessarily suffers grave infirmity. Basic strictures of
fair play dictate that we can only be held liable for our own misdeeds; we can be
made to account only for lapses in our responsibilities. It is notable that of all the
officers, it was Gonzales who took the least time nine days followed by
Cecilio, who took 21 days; Garcia the writer of the draft took less than four
months, and the Ombudsman, less than four months until the kidnapping incident
rendered Mendozas motion moot.
In these lights, the decision of the OP is clearly and patently wrong. This
conclusion, however, does not preclude the Ombudsman from looking into any other
possible administrative liability of Gonzales under existing Civil Service laws, rules
and regulations.
D. The Special Prosecutor: The Constitutional Issue
The 1987 Constitution created a new, independent Office of the Ombudsman. The
existing Tanodbayan at the time83 became the Office of the Special Prosecutor under
the 1987 Constitution. While the composition of the independent Office of the
Ombudsman under the 1987 Constitution does not textually include the Special
Prosecutor, the weight of the foregoing discussions on the unconstitutionality of
Section 8(2) of RA No. 6770 should equally apply to the
Special Prosecutor on the basis of the legislative history of the Office of the
Ombudsman as expounded in jurisprudence.
Under the 1973 Constitution,84 the legislature was mandated to create the Office
of the Ombudsman, known as the Tanodbayan, with investigative and prosecutorial

163

powers. Accordingly, on June 11, 1978, President Ferdinand Marcos enacted PD No.
1487.85

and Bar Council. In case of vacancy in these positions, the law requires that the
vacancy be filled within three (3) months from occurrence.97

Under PD No. 1486,86 however, the "Chief Special Prosecutor" (CSP) was given
the "exclusive authority" to conduct preliminary investigation and to prosecute cases
that are within the jurisdiction of the Sandiganbayan.87 PD No. 1486 expressly gave
the Secretary of Justice the power of control and supervision over the Special
Prosecutor.88 Consistent with this grant of power, the law also authorized the
Secretary of Justice to appoint or detail to the Office of the CSP "any officer or
employee of Department of Justice or any Bureau or Office under the executive
supervision thereof" to assist the Office of the CSP.

The law also imposes on the Special Prosecutor the same qualifications it imposes
on the Ombudsman himself/herself and his/her deputies.98 Their terms of office,99
prohibitions and qualifications,100 rank and salary are likewise the same.101 The
requirement on disclosure102 is imposed on the Ombudsman, the Deputies and the
Special Prosecutor as well. In case of vacancy in the Office of the Ombudsman, the
Overall Deputy cannot assume the role of Acting Ombudsman; the President may
designate any of the Deputies or the Special Prosecutor as Acting Ombudsman.103
The power of the Ombudsman and his or her deputies to require other government
agencies to render assistance to the Office of the Ombudsman is likewise enjoyed by
the Special Prosecutor.104

In December 1978, PD No. 160789 practically gave back to the Tanodbayan the
powers taken away from it by the Office of the CSP. The law "created in the Office
of the Tanodbayan an Office of the Chief Special Prosecutor" under the
Tanodbayans control,90 with the exclusive authority to conduct preliminary
investigation and prosecute all cases cognizable by the Sandiganbayan. Unlike the
earlier decree, the law also empowered the Tanodbayan to appoint Special
Investigators and subordinate personnel and/or to detail to the Office of the CSP any
public officer or employees who "shall be under the supervision and control of the
Chief Special Prosecutor."91 In 1979, PD No. 1630 further amended the earlier
decrees by transferring the powers previously vested in the Special Prosecutor
directly to the Tanodbayan himself.92
This was the state of the law at the time the 1987 Constitution was ratified. Under
the 1987 Constitution, an "independent Office of the Ombudsman" is created.93 The
existing Tanodbayan is made the Office of the Special Prosecutor, "who shall
continue to function and exercise its powers as now94 or hereafter may be provided
by law."95
Other than the Ombudsmans Deputies, the Ombudsman shall appoint all other
officials and employees of the Office of the Ombudsman.96 Section 13(8), Article XI
of the 1987 Constitution provides that the Ombudsman may exercise "such other
powers or perform such functions or duties as may be provided by law." Pursuant to
this constitutional command, Congress enacted RA No. 6770 to provide for the
functional and structural organization of the Office of the Ombudsman and the extent
of its disciplinary authority.
In terms of composition, Section 3 of RA No. 6770 defines the composition of the
Office of the Ombudsman, including in this Office not only the offices of the several
Deputy Ombudsmen but the Office of the Special Prosecutor as well. In terms of
appointment, the law gave the President the authority to appoint the Ombudsman, his
Deputies and the Special Prosecutor, from a list of nominees prepared by the Judicial

Given this legislative history, the present overall legal structure of the Office of the
Ombudsman, both under the 1987 Constitution and RA No. 6770, militates against
an interpretation that would insulate the Deputy Ombudsman from the disciplinary
authority of the OP and yet expose the Special Prosecutor to the same ills that a grant
of independence to the Office of the Ombudsman was designed for.
Congress recognized the importance of the Special Prosecutor as a necessary
adjunct of the Ombudsman, aside from his or her deputies, by making the Office of
the Special Prosecutor an organic component of the Office of the Ombudsman and
by granting the Ombudsman control and supervision over that office.105 This power
of control and supervision includes vesting the Office of the Ombudsman with the
power to assign duties to the Special Prosecutor as he/she may deem fit.1wphi1
Thus, by constitutional design, the Special Prosecutor is by no means an ordinary
subordinate but one who effectively and directly aids the Ombudsman in the exercise
of his/her duties, which include investigation and prosecution of officials in the
Executive Department.
Under Section 11(4) of RA No. 6770, the Special Prosecutor handles the
prosecution of criminal cases within the jurisdiction of the Sandiganbayan and this
prosecutorial authority includes high-ranking executive officials. For emphasis,
subjecting the Special Prosecutor to disciplinary and removal powers of the
President, whose own alter egos and officials in the Executive Department are
subject to the prosecutorial authority of the Special Prosecutor, would seriously place
the independence of the Office of the Ombudsman itself at risk.
Thus, even if the Office of the Special Prosecutor is not expressly made part of the
composition of the Office of the Ombudsman, the role it performs as an organic
component of that Office militates against a differential treatment between the
Ombudsmans Deputies, on one hand, and the Special Prosecutor himself, on the
other. What is true for the Ombudsman must be equally true, not only for her

164

Deputies but, also for other lesser officials of that Office who act directly as agents
of the Ombudsman herself in the performance of her duties.
In Acop v. Office of the Ombudsman,106 the Court was confronted with an
argument that, at bottom, the Office of the Special Prosecutor is not a subordinate
agency of the Office of the Ombudsman and is, in fact, separate and distinct from the
latter. In debunking that argument, the Court said:
Firstly, the petitioners misconstrue Commissioner Romulo's statement as authority
to advocate that the intent of the framers of the 1987 Constitution was to place the
Office of the Special Prosecutor under the Office of the President. Xxx
In the second place, Section 7 of Article XI expressly provides that the then
existing Tanodbayan, to be henceforth known as the Office of the Special Prosecutor,
"shall continue to function and exercise its powers as now or hereafter may be
provided by law, except those conferred on the Office of the Ombudsman created
under this Constitution." The underscored phrase evidently refers to the
Tanodbayan's powers under P.D. No. 1630 or subsequent amendatory legislation. It
follows then that Congress may remove any of the Tanodbayan's/Special Prosecutor's
powers under P.D. N0. 1630 or grant it other powers, except those powers conferred
by the Constitution on the Office of the Ombudsman.
Pursuing the present line of reasoning, when one considers that by express
mandate of paragraph 8, Section 13, Article XI of the Constitution, the Ombudsman
may "exercise such other powers or perform functions or duties as may be provided
by law," it is indubitable then that Congress has the power to place the Office of the
Special Prosecutor under the Office of the Ombudsman.107
Republic of the Philippines
SUPREME COURT
Manila

Thus, under the present Constitution, there is every reason to treat the Special
Prosecutor to be at par with the Ombudsman's deputies, at least insofar as an
extraneous disciplinary authority is concerned, and must also enjoy the same grant of
independence under the Constitution.
III. SUMMARY OF VOTING
In the voting held on January 28, 2014, by a vote of 8-7,108 the Court resolved to
reverse its September 4, 2012 Decision insofar as petitioner Gonzales is concerned
(G.R. No. 196231). We declared Section 8(2) of RA No. 6770 unconstitutional by
granting disciplinary jurisdiction to the President over a Deputy Ombudsman, in
violation of the independence of the Office of the Ombudsman.
However, by another vote of 8-7,109 the Court resolved to maintain the validity of
Section 8(2) of RA No. 6770 insofar as Sulit is concerned. The Court did not
consider the Office of the Special Prosecutor to be constitutionally within the Office
of the Ombudsman and is, hence, not entitled to the independence the latter enjoys
under the Constitution.
WHEREFORE, premises considered, the Court resolves to declare Section 8(2)
UNCONSTITUTIONAL. This ruling renders any further ruling on the dismissal of
Deputy Ombudsman Emilio Gonzales III unnecessary, but is without prejudice to the
power of the Ombudsman to conduct an administrative investigation, if warranted,
into the possible administrative liability of Deputy Ombudsma
IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

SPECIAL SECOND DIVISION

RESOLUTION

G.R. No. 189434

SERENO, C.J.:

March 12, 2014

FERDINAND R. MARCOS, JR., Petitioner,


vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on
Good Government, Respondent.
x-----------------------x
G.R. No. 189505

On 25 April 2012, this Court rendered a Decision affirming the 2 April 2009
Decision of the Sandiganbayan and declaring all the assets of Arelma, S.A., an entity
created by the late Ferdinand E. Marcos, forfeited in favor of the Republic of the
Philippines. The anti-graft court found that the totality of assets and properties
acquired by the Marcos spouses was manifestly and grossly disproportionate to their
aggregate salaries as public officials, and that petitioners were unable to overturn the
prima facie presumption of ill-gotten wealth, pursuant to Section 2 of Republic Act
No. (RA) 1379.

165

Petitioners seek reconsideration of the denial of their petition, reiterating the


following arguments:
1. That the Sandiganbayan erred in granting the Motion for Partial Summary
Judgment because a) the Republic had earlier stated that it will file a separate
forfeiture action regarding the assets of Arelma and b) Civil Case No. 0141 had
already terminated; and
2. That the Sandiganbayan does not possess territorial jurisdiction over the res or the
Arelma proceeds, which are held by Merrill Lynch in the United States.
We agree with the view of the Office of the Solicitor General (OSG) in its
Opposition filed on 16 August 2012, that the first issue has already been raised and
exhaustively discussed in our 25 April 2012 Decision. In fact, the discussion on the
first issue is merely a restatement of petitioners original assertions that the
Sandiganbayan had no jurisdiction to render summary judgment over the assets of
Arelma. According to petitioners, the judgment in Civil Case No. 0141 applied only
to the Swiss deposits subject of our Decision in G.R. No. 152154, which were also
listed in the Petition for Forfeiture.
It is clear from our 25 April 2012 Decision that this is a distorted reading of the
facts.1wphi1 The said Petition for Forfeiture described among others, a corporate
entity by the name "Arelma, Inc.," which maintained an account and portfolio in
Merrill Lynch, New York, and which was purportedly organized for the purpose of
hiding ill-gotten wealth.1 The Decision of this Court in G.R. No. 152154 affirmed
the partial summary judgment only over the Swiss deposits which the Sandiganbayan
declared as forfeited in favor of the State.
This cannot be construed as a bar to a subsequent judgment over numerous other
assets and properties expressly sought to be forfeited in Civil Case No. 0141.
Respondent Republics success in obtaining summary judgment over the Swiss
accounts does not mean its preclusion from seeking partial summary judgment over a
different subject matter covered by the same petition for forfeiture. In fact, Civil
Case No. 0141 pertains to the recovery of all the assets enumerated therein, such as
(1) holding companies, agro-industrial ventures and other investments; (2)
landholdings, buildings, condominium units, mansions; (3) New York properties; (4)
bills amounting to Php 27,744,535, time deposits worth Php 46.4 million, foreign
currencies and jewelry seized by the United States customs authorities in Honolulu,
Hawaii; (5) USD 30 million in the custody of the Central Bank in dollardenominated Treasury Bills; shares of stock, private vehicles, and real estate in the
United States, among others.2

Summary Judgment dated 7 March 2000 specifically identified the five Swiss
accounts. It did not include the Arelma account. To subscribe to the view of
petitioners is to forever bar the State from recovering the assets listed above,
including the properties it had specifically identified in its petition for forfeiture. As
we have discussed in our Decision, the ruling of the Sandiganbayan is rightly
characterized as a separate judgment, and allowed by the Rules of Court under
Section 5 of Rule 36:
Separate judgments.When more than one claim for relief is presented in an action,
the court, at any stage, upon a determination of the issues material to a particular
claim and all counterclaims arising out of the transaction or occurrence which is the
subject matter of the claim, may render a separate judgment disposing of such claim.
The judgment shall terminate the action with respect to the claim so disposed of and
the action shall proceed as to the remaining claims. In case a separate judgment is
rendered, the court by order may stay its enforcement until the rendition of a
subsequent judgment or judgments and may prescribe such conditions as may be
necessary to secure the benefit thereof to the party in whose favor the judgment is
rendered.
Petitioners further insist that "Civil Case No. 0141 does not involve the Arelma
account because the respondent unequivocally reserved its right to file a separate
forfeiture petition concerning it." However, petitioners failed to prove that such a
reservation was made, and never even substantiated how such reservation could
operate to deprive the State of its right to file for separate judgment. There is nothing
in Republic Act 13793 or in the Rules which prohibits the graft court from taking
cognizance of the Motion for Partial Summary Judgment only because of statements
allegedly made by one party. This Court cannot countenance the view advanced by
petitioners defeating the jurisdiction of the Sandiganbayan over violations of R.A.
Nos. 3019 and 1379,4 where the laws themselves do not provide for such limitations.
Petitioner Ferdinand Marcos, Jr. acknowledges that "the subject matter of the case
(i.e. the power/authority to determine whether an asset may be forfeited under R.A.
1379) is within the (Sandiganbayans) jurisdiction."5 However, he objects to the
graft courts purported lack of territorial jurisdiction on the theory that forfeiture is
an action in rem. He argues that the Sandiganbayan must first acquire territorial
jurisdiction over the Arelma proceeds before the judgment may be enforced.
At the outset, this theory fails to make a distinction between the issuance of a
judgment, and its execution. It is basic that the execution of a Courts judgment is
merely a ministerial phase of adjudication.6 The authority of the Sandiganbayan to
rule on the character of these assets as ill-gotten cannot be conflated with petitioners
concerns as to how the ruling may be effectively enforced.

The Swiss Deposits Decision, G.R. No. 152154, dealt only with the summary
judgment as to the five Swiss accounts, because the 2000 Motion for Partial

166

More importantly, petitioner should be reminded of his earlier insistence that R.A.
1379 is penal, therefore petitions for forfeiture filed under this law are actions in
personam, not in rem.7 We reiterate our observations in the Swiss Deposits case:
"Petitioner Republic has the right to a speedy disposition of this case. It would
readily be apparent to a reasonable mind that respondent Marcoses have been
deliberately resorting to every procedural device to delay the resolution hereofThe
people and the State are entitled to favorable judgment, free from vexatious,
capricious and oppressive delays x x x."8
In any case, we find that the Sandiganbayan did not err in granting the Motion for
Partial Summary Judgment, despite the fact that the Arelma account and proceeds are
held abroad. To rule otherwise contravenes the intent of the forfeiture law, and
indirectly privileges violators who are able to hide public assets abroad: beyond the
reach of the courts and their recovery by the State. Forfeiture proceedings, as we
have already discussed exhaustively in our Decision, are actions considered to be in
the nature of proceedings in rem or quasi in rem, such that:

the Marcos regime. It reasoned that the Republic was a necessary party, but could not
be subject to joinder in light of its assertion of sovereign immunity:
(The Republic's) national interests would be severely prejudiced by a turnover
proceeding because it has asserted a claim of ownership regarding the Arelma assets
that rests on several bases: the Philippine forfeiture law that predated the tenure of
President Marcos; evidence demonstrating that Marcos looted public coffers to
amass a personal fortune worth billions of dollars; findings by the Philippine
Supreme Court and Swiss Federal Supreme Court that Marcos stole related assets
from the Republic; and, perhaps most critically, the recent determination by the
Philipp