1. Larin v.

Executive Secretary
[G.R. No. 112745. October 16, 1997]
AQUILINO T. LARIN, petitioner, vs. THE EXECUTIVE
SECRETARY, SECRETARY OF FINANCE, COMMISSIONER
OF THE BUREAU OF INTERNAL REVENUE AND THE
COMMITTEE
CREATED
TO
INVESTIGATE
THE
ADMINISTRATIVE COMPLAINT AGAINST AQUILINO T.
LARIN, COMPOSED OF FRUMENCIO A. LAGUSTAN, JOSE B.
ALEJANDRINO and JAIME M. MAZA, respondents.
DECISION
TORRES, JR., J.:
Challenge in this petition is the validity of petitioners removal from
service as Assistant Commissioner of the Excise Tax Service of
the Bureau of Internal Revenue. Incidentally, he questions
Memorandum order no. 164 issued by the Office of the President,
which provides for the creation of A Committee to Investigate the
Administrative Complaint Against Aquilino T. Larin, Assistant
Commissioner, Bureau of Internal Revenue as well as the
investigation made in pursuance thereto and Administrative
Order No. 101 dated December 2, 1993 which found him guilty of
grave misconduct in the administrative charge and imposed upon
him the penalty of dismissal from office.
Likewise, petitioner seeks to assail the legality of Executive Order
No. 132, issued by President Ramos on October 26, 1993, which
provides for the Streamlining of the Bureau of Internal Revenue,
and of its implementing rules issued by the Bureau of Internal
Revenue, namely: a) Administrative Order No. 4-93, which
provides for the Organizational Structure and Statement of
General Functions of Offices in the National Office and b)
Administrative Order No. 5-93, which provides for Redefining the
Areas of Jurisdiction and Renumbering of Regional And District
Offices.
The antecedent facts of the instant case as succinctly related by
the Solicitor General are as follows:

On September 18, 1992, [1] a decision was rendered by the

Sandiganbayan convicting herein petitioner Aquilino T. Larin,
Revenue Specific Tax Officer, then Assistant Commisioner of the
Bureau of Internal Revenue and his co-accused (except Justino
E. Galban, Jr.) of the crimes of violation of Section 268 (4) of the
National Internal Revenue Code and Section 3 (e) of R.A. 3019
in Criminal Cases Nos. 14208-14209, entitled People of the
Philippines, Plaintiff vs. Aquilino T. Larin, Teodoro T. Pareno,
Justino E. Galban, Jr. and Potenciana N. Evangelista, Accused,
the dispositive portion of the judgment reads:
"WHEREFORE, judgment is now rendered in Criminal Cases
Nos. 14208 and 14209 convicting accused Assistant
Commissioner for Specific Tax Aquilino T. Larin, Chief of the
Alcohol tax Division TEODORO P. PARENO, and Chief of the
Revenue accounting Division POTENCIANA M. EVANGELISTA:
xxx
SO ORDERED.
The fact of petitioners conviction was reported to the President of
the Philippines by the then Acting Finance Secretary Leong
through a memorandum dated June 4, 1993. The memorandum
states, inter alia:
This is a report in the case of Assistant Commissioner AQUILINO
T. LARIN of the Excise tax Service, Bureau of Internal Revenue,
a presidential appointee, one of those convicted in the Criminal
Case Nos. 14208-14209, entitled People of the Philippines vs.
Aquilino T. Larin, et. al. Referred to the Department of Finace by
the Commissioner of Internal Revenue.
The cases against Pareno and Evangelista are being acted upon
by the Bureau of Internal revenue as they non-presidential
appointees.
xxx

xxx
It is clear from the foregoing that Mr. Larin has found beyond
reasonable doubt to have committed acts constituting grave
misconduct. Under the Civil Service Laws and Rules which
require only preponderance of evidence, grave misconduct is
punishable by dismissal.
Acting by authority of the President, Sr. Deputy Executive
Secretary Leonardo A. Quisumbing issued Memorandum Order
No. 164 dated August 25, 1993 which provides for the creation of
an Executive Committee to investigate the administrative charge
against herein petitioner Aquilino T. Larin. It states thus:
A Committee is hereby created to investigate the administrative
complaint filed against Aquilino T. Larin, Assistant Commissioner,
Bureau of Internal Revenue, to be composed of:
Atty. Frumencio A. Lagustan Chairman
Assistant Executive Secretary for Legislation
Mr. Jose B. Alejandro Member
Presidential Assistant
Atty. Jaime M. Maza Member
Assistant commissioner of Inspector services
Bureau of Internal Revenue
The Committee shall have the powers and prerogatives of (an)
investigating committee under the administrative Code of 1987
including the power to summon witnesses, administer oath or
take testimony or evidence relevant to the investigation by
subpoena ad testificandum and subpoena duces tecum:
xxx
The Committee shall convene immediately, conduct the
investigation in the most expeditious manner, and terminate the
same as soon as practicable from its first scheduled date of
hearing.

Consequently, the Committee directed the petitioner to respond

to the administrative charge leveled against him through a letter
dated September 17, 1993, thus:
Presidential Memorandum Order No. 164 dated August 25, 1993,
a xerox copy of which is hereto attached for your ready reference,
created an Investigation Committee to look into the charges
against you which are also the subject of the Criminal Cases No.
14208 and 14209 entitled People of the Philippines vs. Aquilino
T. Larin, et. al.
The committee has its possession a certified true copy of the
Decision of the Sandiganbayan in the above-mentioned cases.
Pursuant to Presidential Memorandum Order No. 164, you are
hereby directed to file your position paper on the aforementioned
charges within seven (7) days from receipt hereof xxx.
Failure to file the required position paper shall be considered as
a waiver on your part to submit such paper or to be heard, in
which case, the Committee shall deem the case submitted on the
basis of the documents and records at hand.
In compliance, petitioner submitted a letter dated September 30,
1993 which was addressed to Atty. Frumencio A. Lagustan , the
Chairman of the Investigating Committee. In said latter, he
asserts that,
The case being sub-judice, I may not , therefore, comment on the
merits of issues involved for fear of being cited in contempt of
Court. This position paper is thus limited to furnishing the
Committee pertinent documents submitted with the Supreme
Court and other tribunal which took cognizance of the case in the
past, as follows:
xxx

The foregoing documents readily show that I am not

administratively liable or criminally culpable of the charges
leveled against me, and that the aforesaid cases are mere
prosecutions caused to be filed and are being orchestrated by
taxpayers who were prejudiced by multi-million peso
assessments I caused to be issued against them in my official
capacity as Assistant Commissioner, Excise Tax office of Bureau
of Internal Revenue.
In the same letter, petitioner claims that the administrative
complaint against him is already barred: a) on jurisdictional
ground as the Office of the Ombudsman had already taken
cognizance of the case and had caused the filing only of the
criminal charges against him, b) by res judicata, c) double
jeopardy, and d) because to proceed with the case would be
redundant, oppressive and a plain persecution against him.
Meanwhile, the President issued the challenged Executive order
No. 132 dated October 26, 1993 which mandates for the
streamlining of the Bureau of Internal Revenue. Under said order,
some positions and functions are either abolished, renamed,
decentralized or transferred to other offices, while other offices
are also created. The Excise Tax Service or the Specific Tax
Service, of which petitioner was the Assistant Commissioner, was
one of those offices that was abolished by said executive order.
The corresponding implementing rules of Executive Order No.
132, namely, revenue Administrative Orders Nos. 4-93 and 5-93,
were subsequently issued .by the Bureau of Internal Revenue.
On October 27, 1993, or one day after the promulgation of
Executive Order No.132, the President appointed the following as
BIR Assistant Commissioners:
1. Bernardo A. Frianeza
2. Dominador L. Galura
3. Jaime D. Gonzales
4. Lilia C. Guillermo
5. Rizalina S. Magalona

6. Victorino C. Mamalateo
7. Jaime M. Masa
8. Antonio N. Pangilinan
9. Melchor S. Ramos
10. Joel L. Tan-Torres
Consequently, the president, in the assailed Administrative Order
No. 101 dated December 2, 1993, found petitioner guilty of grave
misconduct in the administrative charge and imposed upon him
the penalty of dismissal with forfeiture of his leave credits and
retirement benefits including disqualification for reappointment in
the government service.
Aggrieved, petitioner filed directly with this Court the instant
petition on December 13, 1993 to question basically his alleged
unlawful removal from office.
On April 17, 1996 and while the instant petition is pending, this
Court set aside the conviction of the petitioner in Criminal Case
Nos. 14208 and 14209.
In his petition, petitioner challenged the authority of the President
to dismiss him from office. He argued that in so far as presidential
appointees who are Career Executive Service Officers are
concerned, the President exercises only the power of control not
the power to remove. He also averred that the administrative
investigation conducted under Memorandum Order No. 164 is
void as it violated his right to due process. According to him, the
letter of the Committee dated September 17, 1993 and his
position paper dated September 30, 1993 are not sufficient for
purposes of complying with the requirements of due process. He
alleged that he was not informed of the administrative charges
leveled against him nor was he given official notice of his
dismissal.
Petitioner likewise claimed that he was removed as a result of the
reorganization made by the Executive Department in the BIR
pursuant to Executive Order No. 132. Thus, he assailed said
Executive Order No. 132 and its implementing rules, namely,

Revenue Administrative Orders 4-93 and 5-93 for being ultra

vires. He claimed that there is yet no law enacted by Congress
which authorizes the reorganization by the Executive Department
of executive agencies, particularly the Bureau of Internal revenue.
He said that the reorganization sought to be effected by the
Executive Department on the basis of E.O. No. 132 is tainted with
bad faith in apparent violation of Section 2 of R.A. 6656,
otherwise known as the Act Protecting the Security of Tenure of
Civil Service Officers and Employees in the Implementation of
Government Reorganization.
On the other hand, respondents contended that since petitioner
is the presidential appointee, he falls under the disciplining
authority of the President. They also contended that E.O. No. 132
and its implementing rules were validly issued pursuant to
Sections 48 and 62 of Republic Act No. 7645. Apart from this, the
other legal bases of E.O. No. 132 as stated in its preamble are
Section 63 of E.O No.127 (Reorganizing the Ministry of Finance),
and Section 20, Book III of E.O. No. 292, otherwise known as the
Administrative Code of 1987. In addition, it is clear that in Section
11 of R.A No.6656 future reorganization is expressly
contemplated and nothing in said law that prohibits subsequent
reorganization through an executive order. Significantly,
respondents clarified that petitioner was not dismissed by virtue
of EO 132. Respondents claimed that he was removed from office
because he was found guilty of grave misconduct in the
administrative cases filed against him.
The ultimate issue to be resolved in the instant case falls on the
determination of the validity of petitioners dismissal from office.
Incidentally, in order to resolve this matter, it is imperative that
We consider these questions : a) Who has the power to discipline
the petitioner?, b) Were the proceedings taken pursuant to
Memorandum Order No. 164 in accord with due process?, c)
What is the effect of petitioners acquittal in the criminal case to
his administrative charge? d) Does the President have the power
to reorganize the BIR or to issue the questioned E.O. NO. 132?,
e) Is the reorganization of BIR pursuant to E.O. No. 132 tainted
with bad faith?

At the outset, it is worthy to note that the position of the Assistant

Commissioner of the BIR is part of the Career Executive
Service.[2] Under the law,[3] Career Executive Service officers,
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, are all appointed by the President. Concededly,
petitioner was appointed as Assistant Commissioner in January,
1987 by then President Aquino. Thus, petitioner is a presidential
appointee who belongs to career service of the Civil Service.
Being a presidential appointee, he comes under the direct
diciplining authority of the President. This is in line with the well
settled principle that the power to remove is inherent in the power
to appoint conferred to the President by Section 16, Article VII of
the Constitution. Thus, it is ineluctably clear that Memorandum
Order No. 164, which created a committee to investigate the
administrative charge against petitioner, was issued pursuant to
the power of removal of the President. This power of removal,
however, is not an absolute one which accepts no reservation. It
must be pointed out that petitioner is a career service officer.
Under the Administrative Code of 1987, career service is
characterized by the existence of security of tenure, as contradistinguished from non-career service whose tenure is coterminus with that of the appointing or subject to his pleasure, or
limited to a period specified by law or to the duration of a particular
project for which purpose the employment was made. As a career
service officer, petitioner enjoys the right to security of tenure. No
less than the 1987 Constitution guarantees the right of security of
tenure of the employees of the civil service. Specifically, Section
36 of P.D. No. 807, as amended, otherwise known as Civil
Service Decree of the Philippines, is emphatic that career service
officers and employees who enjoy security of tenure may be
removed only for any of the causes enumerated in said law. In
other words, the fact that the petitioner is a presidential appointee
does not give the appointing authority the license to remove him
at will or at his pleasure for it is an admitted fact that he is likewise
a career service officer who under the law is the recipient of

tenurial protection, thus, may only be removed for a cause and in

accordance with procedural due process.
Was petitioner then removed from office for a legal cause under
a valid proceeding?
Although the proceedings taken complied with the requirements
of procedural due process, this Court, however, considers that
petitioner was not dismissed for a valid cause.
It should be noted that what precipitated the creation of the
investigative committee to look into the administrative charge
against petitioner is his conviction by the Sandiganbayan in
criminal Case Nos. 14208 and 14209. As admitted by the
respondents, the administrative case against petitioner is based
on the Sandiganbayan Decision of September 18, 1992. Thus, in
the Administrative Order No. 101 issued by Senior Deputy
Executive Secretary Quisumbing which found petitioner guilty of
grave misconduct, it clearly states that:
"This pertains to the administrative charge against Assistant
Commissioner Aquilino T. Larin of the Bureau of Internal
Revenue, for grave misconduct by virtue of a Memorandum
signed by Acting Secretary Leong of the Department of Finance,
on the basis of decision handed down by the Hon.
Sandiganbayan convicting Larin, et. al. in Criminal Cases No.
14208 and 14209."[4]
In a nutshell, the criminal cases against petitioner refer to his
alleged violation of Section 268 (4) of the National Internal
Revenue Code and of section 3(e) of R.A. No.3019 as a
consequence of his act of favorably recommending the grant of
tax credit to Tanduay Distillery, Inc.. The pertinent portion of the
judgment of the Sandiganbayan reads:
"As above pointed out, the accused had conspired in knowingly
preparing false memoranda and certification in order to effect a
fraud upon taxes due to the government. By their separate acts
which had resulted in an appropriate tax credit of

P180,701,682.00 in favor of Tanduay. The government had been

defrauded of a tax revenue - for the full amount, if one is to look
at the availments or utilization thereof (Exhibits 'AA' to 'AA-31-a'),
or for a substantial portion thereof (P73,000,000.00) if we are to
rely on the letter of Deputy Commissioner Eufracio D. Santos
(Exhibits '21' for all the accused).
As pointed out above, the confluence of acts and omissions
committed by accused Larin, Pareno and Evangelista adequately
prove conspiracy among them for no other purpose than to bring
about a tax credit which Tanduay did not deserve. These
misrepresentations as to how much Tanduay had paid in ad
valorem taxes obviously constituted a fraud of tax revenue of the
government xxx.'[5]
However, it must be stressed at this juncture that the conviction
of petitioner by the Sandiganbayan was set aside by this court in
our decision promulgated on April 17, 1996 in G.R. Nos. 10803738 and 107119-20. We specifically ruled in no uncertain terms
that : a) petitioner cannot be held negligent in relying on the
certification of a co-equal unit in the BIR, b) it is not incumbent
upon Larin to go beyond the certification made by the Revenue
Accounting Division that Tanduay Distillery, Inc. had paid the ad
valorem taxes, c) there is nothing irregular or anything false in
Larin's marginal note on the memorandum addressed to Pareno,
the Chief of Alcohol Tax Division who was also one of the
accused, but eventually acquitted, in the said criminal cases, and
d) there is no proof of actual agreement between the accused,
including petitioner, to commit the illegal acts charged. We are
emphatic in our resolution in said cases that there is nothing
"illegal with the acts committed by the petitioner(s)." We also
declare that "there is no showing that petitioner(s) had acted
irregularly, or performed acts outside of his (their) official
functions." Significantly, these acts which We categorically
declare to be not unlawful and improper in G.R. Nos. 108037-38
and G.R. Nos. 107119-20 are the very same acts for which
petitioner is held to be administratively responsible. Any charge
of malfeasance or misfeasance on the part of the petitioner is
clearly belied by our conclusion in said cases. In the light of this

decisive pronouncement, We see no reason for the administrative

charge to continue - it must, thus, be dismissed.
We are not unaware of the rule that since administrative cases
are independent from criminal actions for the same act or
omission, the dismissal or acquittal of the criminal charge does
not foreclose the institution of administrative action nor carry with
it the relief from administrative liability.[6] However, the
circumstantial setting of the instant case sets it miles apart from
the foregoing rule and placed it well within the exception.
Corollarily, where the very basis of the administrative case
against petitioner is his conviction in the criminal action which was
later on set aside by this court upon a categorical and clear
findings that the acts for which he was administratively held liable
are not unlawful and irregular, the acquittal of the petitioner in the
criminal case necessarily entails the dismissal of the
administrative action against him, because in such a case, there
is no basis nor justifiable reason to maintain the administrative
suit.
On the aspect of procedural due process, suffice it to say that
petitioner was given every chance to present his side. The rule is
well settled that the essence of due process in administrative
proceedings is that a party be afforded a reasonable opportunity
to be heard and to submit any evidence he may have in support
of his defense.[7] The records clearly show that on October 1,
1993 petitioner submitted his letter-response dated September
30, 1993 to the administrative charged filed against him. Aside
from his letter, he also submitted various documents attached as
annexes to his letter, all of which are evidences supporting his
defense. Prior to this, he received a letter dated September 17,
1993 from the Investigation Committee requiring him to explain
his side concerning the charge. It cannot therefore be argued that
petitioner was denied of due process.
Let us now examine Executive Order No. 132.
As stated earlier, with the issuance of Executive Order No. 132,
some of the positions and offices, including the office of Excise

Tax Services of which petitioner was the Assistant

Commissioner, were abolished or otherwise decentralized.
Consequently, the President released the list of appointed
Assistant Commissioners of the BIR. Apparently, petitioner was
not included.
Initially, it is argued that there is no law yet which empowers the
President to issue E.O. No. 132 or to reorganize the BIR.
We do not agree.
Under its Preamble, E.O. No. 132 lays down the legal basis of its
issuance, namely: a) Section 48 and 62 of R.A. No. 7645, b)
Section 63 of E.O. No. 127, and c) Section 20, Book III of E.O.
No. 292.
Section 48 of R.A. 7645 provides that:
"Sec. 48. Scaling Down and Phase Out of Activities of Agencies
Within the Executive Branch. -- The heads of departments,
bureaus and offices and agencies are hereby directed to identify
their respective activities which are no longer essential in the
delivery of public services and which may be scaled down,
phased out or abolished, subject to civil rules and regulations.
xxx. Actual scaling down, phasing out or abolition of the activities
shall be effective pursuant to Circulars or Orders issued for the
purpose by the Office of the President." (italics ours)
Said provision clearly mentions the acts of "scaling down, phasing
out and abolition" of offices only and does not cover the creation
of offices or transfer of functions. Nevertheless, the act of creating
and decentralizing is included in the subsequent provision of
Section 62, which provides that:
"Sec. 62, Unauthorized Organizational Charges. -- Unless
otherwise created by law or directed by the President of the
Philippines, no organizational unit or changes in key positions in
any department or agency shall be authorized in their respective

organization structures and be funded from appropriations by this

Act." (italics ours)
The foregoing provision evidently shows that the President is
authorized to effect organizational changes including the creation
of offices in the department or agency concerned.
The contention of petitioner that the two provisions are riders
deserves scant consideration. Well settled is the rule that every
law has in its favor the presumption of constitutionality.[8] Unless
and until a specific provision of the law is declared invalid and
unconstitutional, the same is valid and binding for all intents and
purposes.
Another legal basis of E.O. No. 132 is Section 20, Book III of E.O.
No. 292 which states:

the Constitution itself recognizes future reorganizations in the

government as what is revealed in Section 16 of Article XVIII,
thus:
"Sec. 16. Career civil service employees separated from service
not for cause but as a result of the xxx reorganization following
the ratification of this Constitution shall be entitled to appropriate
separation pay xxx."
However, We can not consider E.O. No. 127 signed on January
30, 1987 as a legal basis for the reorganization of the BIR. E.O.
No. 127 should be related to the second paragraph of Section 11
of Republic Act No. 6656.
Section 11 provides inter alia:
"xxx

"Sec.20. Residual Powers. -- Unless Congress provides

otherwise, the President shall exercise such other powers and
functions vested in the President which are provided for under the
laws and which are not specifically enumerated above or which
are not delegated by the President in accordance with law."
(italics ours)
This provision speaks of such other powers vested in the
President under the law. What law then which gives him the
power to reorganize? It is Presidential Decree No. 1772[9] which
amended Presidential Decree No. 1416. These decrees
expressly grant the President of the Philippines the continuing
authority to reorganize the national government, which includes
the power to group, consolidate bureaus and agencies, to abolish
offices, to transfer functions, to create and classify functions,
services and activities and to standardize salaries and materials.
The validity of these two decrees are unquestionable. The 1987
Constitution clearly provides that "all laws, decrees, executive
orders, proclamations, letters of instructions and other executive
issuances not inconsistent with this Constitution shall remain
operative until amended, repealed or revoked."[10] So far, there
is yet no law amending or repealing said decrees. Significantly,

In the case of the 1987 reorganization of the executive branch, all

departments and agencies which are authorized by executive
orders promulgated by the President to reorganize shall have
ninety days from the approval of this act within which to
implement their respective reorganization plans in accordance
with the provisions of this Act." (italics ours)
Executive Order No. 127 was part of the 1987 reorganization
contemplated under said provision. Obviously, it had become
stale by virtue of the expiration of the ninety day deadline period.
It can not thus be used as a proper basis for the reorganization of
the BIR. Nevertheless, as shown earlier, there are other legal
bases to sustain the authority of the President to issue the
questioned E.O. No. 132.
While the President's power to reorganize can not be denied, this
does not mean however that the reorganization itself is properly
made in accordance with law. Well-settled is the rule that
reorganization is regarded as valid provided it is pursued in good
faith. Thus, in Dario vs. Mison, this court has had the occasion to
clarify that:

"As a general rule, a reorganization is carried out in good faith if

it is for the purpose of economy or to make bureaucracy more
efficient. In that event no dismissal or separation actually occurs
because the position itself ceases to exist. And in that case the
security of tenure would not be a Chinese Wall. Be that as it may,
if the abolition which is nothing else but a separation or removal,
is done for political reasons or purposely to defeat security of
tenure, or otherwise not in good faith, no valid abolition takes
place and whatever abolition is done is void ab initio. There is an
invalid abolition as where there is merely a change of
nomenclature of positions or where claims of economy are belied
by the existence of ample funds."[11]

d) Where there is a reclassification of offices in the department or

agency concerned and the reclassified offices perform
substantially the same functions as the original offices;
e) Where the removal violates the order of separation provided in
Section 3 hereof."
A reading of some of the provisions of the questioned E.O. No.
132 clearly leads us to an inescapable conclusion that there are
circumstances considered as evidences of bad faith in the
reorganization of the BIR.
Section 1.1.2 of said executive order provides that:

In this regard, it is worth mentioning that Section 2 of R.A. No.

6656 lists down the circumstances evidencing bad faith in the
removal of employees as a result of the reorganization, thus:
Sec. 2. No officer or employee in the career service shall be
removed except for a valid cause and after due notice and
hearing. A valid cause for removal exist when, pursuant to a bona
fide reorganization, a position has been abolished or rendered
redundant or there is a need to merge, divide, or consolidate
positions in order to meet the exigencies of the service, or other
lawful causes allowed by the Civil Service Law. The existence of
any or some of the following circumstances may be considered
as evidence of bad faith in the removals made as a result of the
reorganization, giving rise to a claim for reinstatement or
reappointment by an aggrieved party:
a) Where there is a significant increase in the number of positions
in the new staffing pattern of the department or agency
concerned;
b) Where an office is abolished and another performing
substantially the same functions is created;
c) Where incumbents are replaced by those less qualified in
terms of status of appointment, performance and merit;

"1.1.2 The Intelligence and Investigation Office and the

Inspection Service are abolished. An Intelligence and
Investigation Service is hereby created to absorb the same
functions of the abolished office and service. xxx" (italics ours)
This provision is a clear illustration of the circumstance mentioned
in Section 2 (b) of R.A. No. 6656 that an office is abolished and
another one performing substantially the same function is
created.
Another circumstance is the creation of services and divisions in
the BIR resulting to a significant increase in the number of
positions in the said bureau as contemplated in paragraph (a) of
section 2 of R.A. No. 6656. Under Section 1.3 of E.O. No. 132,
the Information Systems Group has two newly created Systems
Services. Aside from this, six new divisions are also created.
Under Section 1.2.1, three more divisions of the Assessment
Service are formed. With this newly created offices, there is no
doubt that a significant increase of positions will correspondingly
follow.
Furthermore, it is perceivable that the non-reappointment of the
petitioner as Assistant Commissioner violates Section 4 of R.A.
No. 6656. Under said provision, officers holding permanent

appointments are given preference for appointment to the new

positions in the approved staffing pattern comparable to their
former position or in case there are not enough comparable
positions to positions next lower in rank. It is undeniable that
petitioner is a career executive officer who is holding a permanent
position. Hence, he should have given preference for
appointment in the position of Assistant Commissioner. As
claimed by petitioner, Antonio Pangilinan who was one of those
appointed as Assistant Commissioner, "is an outsider of sorts to
the bureau, not having been an incumbent officer of the bureau
at the time of the reorganization." We should not lose sight of the
second paragraph of Section 4 of R.A. No. 6656 which explicitly
states that no new employees shall be taken in until all permanent
officers shall have been appointed for permanent position.
IN VIEW OF THE FOREGOING, the petition is granted, and
petitioner is hereby reinstated to his position as Assistant
Commissioner without loss of seniority rights and shall be entitled
to full backwages from the time of his separation from service until
actual reinstatement unless, in the meanwhile, he would have
reached the compulsory retirement age of sixty-five years in
which case, he shall be deemed to have retired at such age and
entitled thereafter to the corresponding retirement benefits.
SO ORDERED.

2. Dario v. Mison
G.R. No. 81954

August 8, 1989

CESAR Z. DARIO, petitioner,

vs.
HON. SALVADOR M. MISON, HON. VICENTE JAYME and
HON. CATALINO MACARAIG, JR., in their respective capacities
as Commissioner of Customs, Secretary of Finance, and
Executive Secretary, respondents.
G.R. No. 81967

August 8, 1989

VICENTE A. FERIA JR., petitioner,

vs.
HON. SALVADOR M. MISON, HON. VICENTE JAYME, and
HON. CATALINO MACARAIG, JR., in their respective capacities
as Commissioner of Customs, Secretary of Finance, and
Executive Secretary, respondents.
G.R. No. 82023

August 8, 1989

ADOLFO CASARENO, PACIFICO LAGLEVA, JULIAN C.

ESPIRITU, DENNIS A. AZARRAGA, RENATO DE JESUS,
NICASIO C. GAMBOA, CORAZON RALLOS NIEVES,
FELICITACION R. GELUZ, LEODEGARIO H. FLORESCA,
SUBAER PACASUM, ZENAIDA LANARIA, JOSE B. ORTIZ,
GLICERIO R. DOLAR, CORNELIO NAPA, PABLO B. SANTOS,
FERMIN RODRIGUEZ, DALISAY BAUTISTA, LEONARDO
JOSE, ALBERTO LONTOK, PORFIRIO TABINO, JOSE
BARREDO, ROBERTO ARNALDO, ESTER TAN, PEDRO
BAKAL, ROSARIO DAVID, RODOLFO AFUANG, LORENZO
CATRE, LEONCIA CATRE, ROBERTO ABADA, petitioners,
vs.
COMMISSIONER SALVADOR M. MISON, COMMISSIONER,
BUREAU OF CUSTOMS, respondent.
G.R. No. 83737

August 8, 1989

BENEDICTO L. AMASA and WILLIAM S. DIONISIO, petitioners,

vs.
PATRICIA A. STO. TOMAS, in her capacity as Chairman of the
Civil Service Commission and SALVADOR MISON, in his
capacity as Commissioner of the Bureau of Customs,
respondents.
G.R. No. 85310

August 8, 1989

SALVADOR M. MISON, in his capacity as Commissioner of

Customs, petitioner,
vs.
CIVIL SERVICE COMMISSION, ABACA, SISINIO T., ABAD,
ROGELIO C., ABADIANO, JOSE P., ABCEDE, NEMECIO C.,
ABIOG, ELY F., ABLAZA, AURORA M., AGBAYANI, NELSON I.,
AGRES ANICETO, AGUILAR, FLOR, AGUILUCHO MA.
TERESA R., AGUSTIN, BONIFACIO T., ALANO, ALEX P.,
ALBA, MAXIMO F. JR., ALBANO, ROBERT B., ALCANTARA,
JOSE G., ALMARIO, RODOLFO F., ALVEZ, ROMUALDO R.,
AMISTAD RUDY M., AMOS, FRANCIS F., ANDRES, RODRIGO
V., ANGELES, RICARDO S., ANOLIN, MILAGROS H., AQUINO,
PASCASIO E., ARABE, MELINDA M., ARCANGEL, AGUSTIN
S., JR., ARPON, ULPLIANO U., JR., ARREZA, ARTEMIO M.,
JR., ARROJO, ANTONIO P., ARVISU, ALEXANDER S.,
ASCA;O, ANTONIO T., ASLAHON, JULAHON P., ASUNCION,
VICTOR R., ATANGAN, LORNA S., ATIENZA, ALEXANDER R.,
BACAL, URSULINO C., BA;AGA, MARLOWE, Z., BANTA,
ALBERTO T., BARREDO, JOSE B., BARROS, VICTOR C.,
BARTOLOME, FELIPE A., BAYSAC, REYNALDO S., BELENO,
ANTONIO B., BERNARDO, ROMEO D., BERNAS, MARCIANO
S., BOHOL, AUXILIADOR G., BRAVO, VICTOR M., BULEG,
BALILIS R., CALNEA, MERCEDES M., CALVO, HONESTO G.,
CAMACHO, CARLOS V., CAMPOS, RODOLFO C.,
CAPULONG, RODRIGO G., CARINGAL, GRACIA Z., CARLOS,
LORENZO B., CARRANTO, FIDEL U., CARUNGCONG,
ALFREDO M., CASTRO, PATRICIA J., CATELO, ROGELIO B.,
CATURLA, MANUEL B., CENIZAL, JOSEFINA F., CINCO,
LUISITO, CONDE0, JOSE C., JR., CORCUERA, FIDEL S.,
CORNETA, VICENTE S., CORONADO, RICARDO S., CRUZ,

EDUARDO S., CRUZ, EDILBERTO A., CRUZ, EFIGENIA B.,

CRUZADO, MARCIAL C., CUSTODIO, RODOLFO M., DABON,
NORMA M., DALINDIN, EDNA MAE D., DANDAL, EDEN F.,
DATUHARON, SATA A., DAZO, GODOFREDO L., DE CASTRO,
LEOPAPA, DE GUZMAN, ANTONIO A., DE GUZMAN, RENATO
E., DE LA CRUZ, AMADO A., JR., DE LA CRUZ, FRANCISCO
C., DE LA PE;A, LEONARDO, DEL CAMPO, ORLANDO, DEL
RIO, MAMERTO P., JR., DEMESA, WILHELMINA T.,
DIMAKUTA, SALIC L., DIZON, FELICITAS A., DOCTOR, HEIDY
M., DOLAR, GLICERIO R., DOMINGO, NICANOR J.,
DOMINGO, PERFECTO V., JR., DUAY, JUANA G.,
DYSANGCO, RENATO F., EDILLOR, ALFREDO P., ELEVAZO,
LEONARDO A., ESCUYOS, MANUEL M., JR., ESMERIA,
ANTONIO E., ESPALDON, MA. LOURDES H., ESPINA,
FRANCO A., ESTURCO, RODOLFO C., EVANGELINO,
FERMIN I., FELIX, ERNESTO G., FERNANDEZ, ANDREW M.,
FERRAREN, ANTONIO C., FERRERA, WENCESLAO A.,
FRANCISCO, PELAGIO S., JR., FUENTES, RUDY L.,
GAGALANG, RENATO V., GALANG, EDGARDO R., GAMBOA,
ANTONIO C., GAN, ALBERTO R., GARCIA, GILBERT M.,
GARCIA, EDNA V., GARCIA, JUAN L., GAVIOLA, LILIAN V.,
GEMPARO, SEGUNDINA G., GOBENCIONG, FLORDELIZ B.,
GRATE, FREDERICK R., GREGORIO, LAURO P., GUARTICO,
AMMON H., GUIANG, MYRNA N., GUINTO, DELFIN C.,
HERNANDEZ, LUCAS A., HONRALES, LORETO N., HUERTO,
LEOPOLDO H., HULAR , LANNYROSS E., IBA;EZ, ESTER C.,
ILAGAN, HONORATO C., INFANTE, REYNALDO C., ISAIS,
RAY C., ISMAEL, HADJI AKRAM B., JANOLO, VIRGILIO M.,
JAVIER, AMADOR L., JAVIER, ROBERTO S., JAVIER,
WILLIAM R., JOVEN, MEMIA A., JULIAN, REYNALDO V.,
JUMAMOY, ABUNDIO A., JUMAQUIAO, DOMINGO F.,
KAINDOY, PASCUAL B., JR., KOH, NANIE G., LABILLES,
ERNESTO S., LABRADOR, WILFREDO M., LAGA,
BIENVENIDO M., LAGLEVA, PACIFICO Z., LAGMAN,
EVANGELINE G., LAMPONG, WILFREDO G., LANDICHO,
RESTITUTO A., LAPITAN, CAMILO M., LAURENTE,
REYNALDO A., LICARTE, EVARISTO R., LIPIO, VICTOR O.,
LITTAUA, FRANKLIN Z., LOPEZ, MELENCIO L., LUMBA,
OLIVIA., MACAISA, BENITO T., MACAISA, ERLINDA C.,

MAGAT, ELPIDIO, MAGLAYA, FERNANDO P., MALABANAN,

ALFREDO C., MALIBIRAN, ROSITA D., MALIJAN, LAZARO V.,
MALLI, JAVIER M., MANAHAN, RAMON S., MANUEL, ELPIDIO
R., MARAVILLA, GIL B., MARCELO, GIL C., MARI;AS,
RODOLFO V., MAROKET, JESUS C., MARTIN, NEMENCIO A.,
MARTINEZ, ROMEO M., MARTINEZ, ROSELINA M., MATIBAG,
ANGELINA G., MATUGAS, ERNESTO T., MATUGAS,
FRANCISCO T., MAYUGA, PORTIA E., MEDINA, NESTOR M.,
MEDINA, ROLANDO S., MENDAVIA, AVELINO I., MENDOZA,
POTENCIANO G., MIL, RAY M., MIRAVALLES, ANASTACIA L.,
MONFORTE, EUGENIO, JR., G., MONTANO, ERNESTO F.,
MONTERO, JUAN M. III., MORALDE, ESMERALDO B., JR.,
MORALES, CONCHITA D.L., MORALES, NESTOR P.,
MORALES, SHIRLEY S., MUNAR, JUANITA L., MU;OZ,
VICENTE R., MURILLO, MANUEL M., NACION, PEDRO R.,
NAGAL, HENRY N., NAPA, CORNELIO B., NAVARRO, HENRY
L., NEJAL, FREDRICK E., NICOLAS, REYNALDO S., NIEVES,
RUFINO A., OLAIVAR, SEBASTIAN T., OLEGARIO, LEO Q.,
ORTEGA, ARLENE R., ORTEGA, JESUS R., OSORIO, ABNER
S., PAPIO, FLORENTINO T. II, PASCUA, ARNULFO A.,
PASTOR, ROSARIO, PELAYO, ROSARIO L., PE;A, AIDA C.,
PEREZ, ESPERIDION B., PEREZ, JESUS BAYANI M., PRE,
ISIDRO A., PRUDENCIADO, EULOGIA S., PUNZALAN,
LAMBERTO N., PURA, ARNOLD T., QUINONES, EDGARDO I.,
QUINTOS, AMADEO C., JR., QUIRAY, NICOLAS C., RAMIREZ,
ROBERTO P., RA;ADA, RODRIGO C., RARAS, ANTONIO A.,
RAVAL, VIOLETA V., RAZAL, BETTY R., REGALA, PONCE F.,
REYES, LIBERATO R., REYES, MANUEL E., REYES, NORMA
Z., REYES, TELESFORO F., RIVERA, ROSITA L., ROCES,
ROBERTO V., ROQUE, TERESITA S., ROSANES, MARILOU
M., ROSETE, ADAN I., RUANTO, REY, CRISTO C., JR.,
SABLADA, PASCASIO G., SALAZAR, SILVERIA S., SALAZAR,
VICTORIA A., SALIMBACOD, PERLITA C., SALMINGO,
LOURDES M., SANTIAGO, EMELITA B., SATINA, PORFIRIO
C., SEKITO, COSME B., JR., SIMON, RAMON P., SINGSON,
MELECIO C., SORIANO, ANGELO L., SORIANO, MAGDALENA
R., SUMULONG, ISIDRO L., JR., SUNICO, ABELARDO T.,
TABIJE, EMMA B., TAN, RUDY, GOROSPE, TAN, ESTER S.,
TAN, JULITA S., TECSON, BEATRIZ B., TOLENTINO,

BENIGNO A., TURINGAN, ENRICO T., JR., UMPA, ALI A.,

VALIC, LUCIO E., VASQUEZ, NICANOR B., VELARDE,
EDGARDO C., VERA, AVELINO A., VERAME, OSCAR E.,
VIADO, LILIAN T., VIERNES, NAPOLEON K., VILLALON,
DENNIS A., VILLAR, LUZ L., VILLALUZ, EMELITO V., ZATA,
ANGEL A., JR., ACHARON, CRISTETO, ALBA, RENATO B.,
AMON, JULITA C., AUSTRIA, ERNESTO C., CALO,
RAYMUNDO M., CENTENO, BENJAMIN R., DE CASTRO,
LEOPAPA C ., DONATO, ESTELITA P., DONATO, FELIPE S.,
FLORES, PEDRITO S., GALAROSA, RENATO, MALAWI,
MAUYAG, MONTENEGRO, FRANCISCO M., OMEGA,
PETRONILO T., SANTOS, GUILLERMO F., TEMPLO, CELSO,
VALDERAMA, JAIME B., and VALDEZ, NORA M., respondents.
G.R. No. 85335

August 8, 1989

FRANKLIN Z. LITTAUA, ADAN I. ROSETE, FRANCISCO T.

MATUGAS, MA. J. ANGELINA G. MATIBAG, LEODEGARDIO H.
FLORESCA, LEONARDO A. DELA PE;A, ABELARDO T.
SUNICO, MELENCIO L. LOPEZ, NEMENCIO A. MARTIN, RUDY
M. AMISTAD, ERNESTO T. MATUGAS, SILVERIA S. SALAZAR,
LILLIAN V. GAVIOLA, MILAGROS ANOLIN, JOSE B. ORTIZ,
ARTEMIO ARREZA, JR., GILVERTO M. GARCIA, ANTONIO A.
RARAS, FLORDELINA B. GOBENCIONG, ANICETO AGRES,
EDGAR Y. QUINONES, MANUEL B. CATURLA, ELY F. ABIOG,
RODRIGO C. RANADA, LAURO GREGORIO, ALBERTO I.
GAN, EDGARDO GALANG, RAY C. ISAIS, NICANOR B.
VASQUEZ, MANUEL ESCUYOS, JR., ANTONIO B. BELENO,
ELPIO R. MANUEL, AUXILIADOR C. BOHOL, LEONARDO
ELEVAZO, VICENTE S. CORNETA, petitioners,
vs.
COM. SALVADOR M. MISON/BUREAU OF CUSTOMS and the
CIVIL SERVICE COMMISSION, respondents.
G.R. No. 86241

August 8, 1989

SALVADOR M. MISON, in his capacity as Commissioner of

Customs, petitioner,
vs.

CIVIL SERVICE COMMISSION, SENEN S. DIMAGUILA,

ROMEO P. ARABE BERNARDO S. QUINTONG, GREGORIO P.
REYES, and ROMULO C. BADILLO respondents
SARMIENTO, J.:
The Court writes finis to this contreversy that has raged bitterly
for the several months. It does so out of ligitimate presentement
of more suits reaching it as a consequence of the government
reorganization and the instability it has wrought on the
performance and efficiency of the bureaucracy. The Court is
apprehensive that unless the final word is given and the ground
rules are settled, the issue will fester, and likely foment on the
constitutional crisis for the nation, itself biset with grave and
serious problems.
The facts are not in dispute.
On March 25, 1986, President Corazon Aquino promulgated
Proclamation No. 3, "DECLARING A NATIONAL POLICY TO
IMPLEMENT THE REFORMS MANDATED BY THE PEOPLE,
PROTECTING THEIR BASIC RIGHTS, ADOPTING A
PROVISIONAL CONSTITUTION, AND PROVIDING FOR AN
ORDERLY TRANSITION TO A GOVERNMENT UNDER A NEW
CONSTITUTION." Among other things, Proclamation No. 3
provided:
SECTION 1. ...
The President shall give priority to measures to achieve the
mandate of the people to:
(a)
Completely reorganize the government, eradicate unjust
and oppressive structures, and all iniquitous vestiges of the
previous regime; 1
...

Pursuant thereto, it was also provided:

SECTION 1. In the reorganization of the government, priority
shall be given to measures to promote economy, efficiency, and
the eradication of graft and corruption.
SECTION 2. All elective and appointive officials and employees
under the 1973 Constitution shall continue in office until otherwise
provided by proclamation or executive order or upon the
appointment and qualification of their successors, if such is made
within a period of one year from February 25, 1986.
SECTION 3. Any public officer or employee separated from the
service as a result of the organization effected under this
Proclamation shall, if entitled under the laws then in force, receive
the retirement and other benefits accruing thereunder.
SECTION 4. The records, equipment, buildings, facilities and
other properties of all government offices shall be carefully
preserved. In case any office or body is abolished or reorganized
pursuant to this Proclamation, its FUNDS and properties shall be
transferred to the office or body to which its powers, functions and
responsibilities substantially pertain. 2
Actually, the reorganization process started as early as February
25, 1986, when the President, in her first act in office, called upon
"all appointive public officials to submit their courtesy
resignation(s) beginning with the members of the Supreme
Court."3 Later on, she abolished the Batasang Pambansa4 and
the positions of Prime Minister and Cabinet 5 under the 1973
Constitution.
Since then, the President has issued a number of executive
orders and directives reorganizing various other government
offices, a number of which, with respect to elected local officials,
has been challenged in this Court, 6 and two of which, with
respect to appointed functionaries, have likewise been
questioned herein. 7

On May 28, 1986, the President enacted Executive Order No. 17,
"PRESCRIBING RULES AND REGULATIONS FOR THE
IMPLEMENTATION OF SECTION 2, ARTICLE III OF THE
FREEDOM CONSTITUTION." Executive Order No. 17
recognized the "unnecessary anxiety and demoralization among
the deserving officials and employees" the ongoing government
reorganization had generated, and prescribed as "grounds for the
separation/replacement of personnel," the following:
SECTION 3. The following shall be the grounds for separation
replacement of personnel:
1)
Existence of a case for summary dismissal pursuant to
Section 40 of the Civil Service Law;
2)
Existence of a probable cause for violation of the Anti-Graft
and Corrupt Practices Act as determined by the Mnistry Head
concerned;
3)
Gross incompetence or inefficiency in the discharge of
functions;
4)

Misuse of public office for partisan political purposes;

5)
Any other analogous ground showing that the incumbent
is unfit to remain in the service or his separation/replacement is
in the interest of the service.8
On January 30, 1987, the President promulgated Executive Order
No. 127, "REORGANIZING THE MINISTRY OF FINANCE." 9
Among other offices, Executive Order No. 127 provided for the
reorganization of the Bureau of Customs 10 and prescribed a new
staffing pattern therefor.
Three days later, on February 2, 1987, 11 the Filipino people
adopted the new Constitution.

On January 6, 1988, incumbent Commissioner of Customs

Salvador Mison issued a Memorandum, in the nature of
"Guidelines on the Implementation of Reorganization Executive
Orders," 12 prescribing the procedure in personnel placement. It
also provided:
1.
By February 28, 1988, the employees covered by
Executive Order 127 and the grace period extended to the
Bureau of Customs by the President of the Philippines on
reorganization shall be:
a)

informed of their re-appointment, or

b)
or

offered another position in the same department or agency

c)

informed of their termination. 13

In this connection, we regret to inform you that your services are

hereby terminated as of February 28, 1988. Subject to the normal
clearances, you may receive the retirement benefits to which you
may be entitled under existing laws, rules and regulations.
In the meantime, your name will be included in the consolidated
list compiled by the Civil Service Commission so that you may be
given priority for future employment with the Government as the
need arises.
Sincerely yours,
(Sgd) SALVADOR M. MISON
Commissioner15
As far as the records will yield, the following were recipients of
these notices:

On the same date, Commissioner Mison constituted a

Reorganization Appeals Board charged with adjudicating appeals
from removals under the above Memorandum. 14 On January 26,
1988, Commissioner Mison addressed several notices to various
Customs officials, in the tenor as follows:

1.

CESAR DARIO

2.

VICENTE FERIA, JR.

3.

ADOLFO CASARENO

4.

PACIFICO LAGLEVA

5.

JULIAN C. ESPIRITU

6.

DENNIS A. AZARRAGA

7.

RENATO DE JESUS

8.

NICASIO C. GAMBOA

9.

CORAZON RALLOS NIEVES

10.

FELICITACION R. GELUZ

11.

LEODEGARIO H. FLORESCA

Sir:
Please be informed that the Bureau is now in the process of
implementing the Reorganization Program under Executive
Order No. 127.
Pursuant to Section 59 of the same Executive Order, all officers
and employees of the Department of Finance, or the Bureau of
Customs in particular, shall continue to perform their respective
duties and responsibilities in a hold-over capacity, and that those
incumbents whose positions are not carried in the new
reorganization pattern, or who are not re- appointed, shall be
deemed separated from the service.

12.

SUBAER PACASUM

13.

ZENAIDA LANARIA

14.

JOSE B. ORTIZ

15.

GLICERIO R. DOLAR

16.

CORNELIO NAPA

17.
18.
19.
20.

23.

JOSE BARREDO

24.

ROBERTO ARNALDO

25.

ESTER TAN

26.

PEDRO BAKAL

31.

34.

ABADIANO, JOSE P

35.

ABCEDE, NEMECIO C.

36.

ABIOG, ELY F.

37.

ABLAZA, AURORA M.

38.

AGBAYANI, NELSON I.

39.

AGRES, ANICETO

40.

AGUILAR, FLOR

41.

AGUILUCHO, MA. TERESA R.

42.

AGUSTIN, BONIFACIO T.

43.

ALANO, ALEX P.

44.

ALBA, MAXIMO F. JR.

45.

ALBANO, ROBERT B.

46.

ALCANTARA, JOSE G.

47.

ALMARIO, RODOLFO F.

48.

ALVEZ, ROMUALDO R.

49.

AMISTAD, RUDY M.

50.

AMOS, FRANCIS F.

LEONARDO JOSE

PORFIRIO TABINO

30.

ABAD, ROGELIO C.

DALISAY BAUTISTA

22.

29.

33.

FERMIN RODRIGUEZ

ALBERTO LONTOK

28.

ABACA, SISINIO T.

PABLO B. SANTOS

21.

27.

32.

ROSARIO DAVID
RODOLFO AFUANG
LORENZO CATRE
LEONCIA CATRE
ROBERTO ABADA

51.

ANDRES, RODRIGO V.

52.

ANGELES, RICARDO S.

53.

ANOLIN, MILAGROS H.

54.

AQUINO, PASCASIO E. L.

55.

ARABE, MELINDA M.

56.
57.
58.
59.

62.

ASLAHON, JULAHON P.

63.

ASUNCION, VICTOR R.

64.

ATANGAN, LORNA S.

65.

ANTIENZA, ALEXANDER R.

70.

73.

BERNARDO, ROMEO D.

74.

BERNAS, MARCIANO S.

75.

BOHOL, AUXILIADOR G.

76.

BRAVO, VICTOR M.

77.

BULEG, BALILIS R.

78.

CALNEA, MERCEDES M.

79.

CALVO, HONESTO G.

80.

CAMACHO, CARLOS V.

81.

CAMPOS, RODOLFO C.

82.

CAPULONG, RODRIGO G.

83.

CARINGAL, GRACIA Z.

84.

CARLOS, LORENZO B.

85.

CARRANTO, FIDEL U.

86.

CARUNGCONG, ALFREDO M.

87.

CASTRO, PATRICIA J.

88.

CATELO, ROGELIO B.

89.

CATURLA, MANUEL B.

ARROJO, ANTONIO P.

ASCA;O, ANTONIO T.

69.

BELENO, ANTONIO B.

ARREZA, ARTEMIO M, JR.

61.

68.

72.

ARPON, ULPIANO U., JR.

ARVISU, ALEXANDER S.

67.

BAYSAC, REYNALDO S.

ARCANGEL, AGUSTIN S, JR.

60.

66.

71.

BACAL URSULINO C.
BA;AGA, MARLOWE Z.
BANTA, ALBERTO T.
BARROS, VICTOR C.
BARTOLOME, FELIPE A.

90.

CENIZAL, JOSEFINA F.

91.

CINCO, LUISITO

92.

CONDE, JOSE C., JR.

93.

CORCUERA, FIDEL S.

94.

CORNETA, VICENTE S.

95.
96.
97.
98.

101.

DABON, NORMA M.

102.

DALINDIN, EDNA MAE D.

103.

DANDAL, EDEN F.

104.

DATUHARON, SATA A.

109.

112.

DEL CAMPO, ORLANDO

113.

DEL RIO, MAMERTO P., JR.

114.

DEMESA, WILHELMINA T.

115.

DIMAKUTA, SALIC L.

116.

DIZON, FELICITAS A.

117.

DOCTOR, HEIDY M.

118.

DOMINGO, NICANOR J.

119.

DOMINGO, PERFECTO V., JR.

120.

DUAY, JUANA G.

121.

DYSANGCO, RENATO F.

122.

EDILLOR, ALFREDO P.

123.

ELEVAZO, LEONARDO A

124.

ESCUYOS, MANUEL M., JR.

125.

ESMERIA, ANTONIO E.

126.

ESPALDON, MA. LOURDES H.

127.

ESPINA, FRANCO A.

128.

ESTURCO, RODOLFO C.

CRUZ, EFIGENIA B.

CUSTODIO, RODOLFO M.

108.

DE LA PE;A, LEONARDO

CRUZ, EDILBERTO A,

100.

107.

111.

CRUZ, EDUARDO S.

CRUZADO,NORMA M.

106.

DE LA CRUZ, FRANCISCO C.

CORONADO, RICARDO S.

99.

105.

110.

DAZO, GODOFREDO L.
DE CASTRO, LEOPAPA
DE GUZMAN, ANTONIO A.
DE GUZMAN, RENATO E.
DE LA CRUZ, AMADO A., JR.

129.

EVANGELINO, FERMIN I.

130.

FELIX, ERNESTO G.

131.

FERNANDEZ, ANDREW M.

132.

FERRAREN, ANTONIO C.

133.

FERRERA, WENCESLAO A.

134.
135.
136.
137.

140.

GARCIA, GILBERT M.

141.

GARCIA, EDNA V.

142.

GARCIA, JUAN L.

143.

GAVIOIA, LILIAN V.

148.

151.

HERNANDEZ, LUCAS A.

152.

HONRALES, LORETO N.

153.

HUERTO, LEOPOLDO H.

154.

HULAR, LANNYROSS E.

155.

IBA;EZ, ESTER C.

156.

ILAGAN, HONORATO C.

157.

INFANTE, REYNALDO C.

158.

ISAIS, RAY C.

159.

ISMAEL, HADJI AKRAM B.

160.

JANOLO, VIRGILIO M.

161.

JAVIER, AMADOR L.

162.

JAVIER, ROBERTO S.

163.

JAVIER, WILLIAM R.

164.

JOVEN, MEMIA A.

165.

JULIAN, REYNALDO V.

166.

JUMAMOY, ABUNDIO A.

167.

JUMAQUIAO, DOMINGO F.

GALANG, EDGARDO R.

GAN, ALBERTO P

147.

GUINTO, DELFIN C.

GAGALANG, RENATO V.

139.

146.

150.

FUENTES, RUDY L.

GAMBOA, ANTONIO C.

145.

GUIANG, MYRNA N.

FRANCISCO, PELAGIO S, JR.

138.

144.

149.

GEMPARO, SEGUNDINA G.
GOBENCIONG, FLORDELIZ B.
GRATE, FREDERICK R.
GREGORIO, LAURO P.
GUARTICO, AMMON H.

168.

KAINDOY, PASCUAL B., JR.

169.

KOH, NANIE G.

170.

LABILLES, ERNESTO S.

171.

LABRADOR, WILFREDO M.

172.

LAGA, BIENVENIDO M.

173.
174.
175.
176.

179.

LIPIO, VICTOR O.

180.

LITTAUA, FRANKLIN Z.

181.

LOPEZ, MELENCIO L.

182.

LUMBA, OLIVIA R.

187.

190.

MALLI, JAVIER M.

191.

MANAHAN, RAMON S.

192.

MANUEL, ELPIDIO R.

193.

MARAVILLA, GIL B.

194.

MARCELO, GIL C.

195.

MARI;AS, RODOLFO V.

196.

MAROKET ,JESUS C.

197.

MARTIN, NEMENCIO A.

198.

MARTINEZ, ROMEO M.

199.

MARTINEZ, ROSELINA M.

200.

MATIBAG, ANGELINA G.

201.

MATUGAS, ERNESTO T.

202.

MATUGAS, FRANCISCO T.

203.

MAYUGA, PORTIA E.

204.

MEDINA, NESTOR M.

205.

MEDINA, ROLANDO S.

206.

MENDAVIA, AVELINO

LAPITAN, CAMILO M.

LICARTE, EVARISTO R.

186.

MALIJAN, LAZARO V.

LANDICHO, RESTITUTO A.

178.

185.

189.

LAMPONG, WILFREDO G.

LAURENTE, REYNALDO A.

184.

MALIBIRAN, ROSITA D.

LAGMAN, EVANGELINE G.

177.

183.

188.

MACAISA, BENITO T.
MACAISA, ERLINDA C.
MAGAT, ELPIDIO
MAGLAYA, FERNANDO P.
MALABANAN, ALFREDO C.

207.

MENDOZA, POTENCIANO G.

208.

MIL, RAY M.

209.

MIRAVALLES, ANASTACIA L.

210.

MONFORTE, EUGENIO, JR. G.

211.

MONTANO, ERNESTO F.

212.
213.
214.
215.

218.

MU;OZ, VICENTE R.

219.

MURILLO, MANUEL M.

220.

NACION, PEDRO R.

221.

NAGAL, HENRY N.

226.

229.

ORTEGA, JESUS R.

230.

OSORIO, ABNER S.

231.

PAPIO FLORENTINO T. II

232.

PASCUA, ARNULFO A.

233.

PASTOR, ROSARIO

234.

PELAYO, ROSARIO L.

235.

PE;A, AIDA C.

236.

PEREZ, ESPERIDION B.

237.

PEREZ, JESUS BAYANI M.

238.

PRE, ISIDRO A.

239.

PRUDENCIADO, EULOGIA S.

240.

PUNZALAN, LAMBERTO N.

241.

PURA, ARNOLD T.

242.

QUINONES, EDGARDO I.

243.

QUINTOS, AMADEO C., JR.

244.

QUIRAY, NICOLAS C.

245.

RAMIREZ, ROBERTO P.

MORALES, NESTOR P.

MUNAR, JUANITA L.

225.

ORTEGA, ARLENE R.

MORALES, CONCHITA D. L

217.

224.

228.

MORALDE, ESMERALDO B., JR.

MORALES, SHIRLEY S.

223.

OLEGARIO, LEO Q.

MONTERO, JUAN M. III

216.

222.

227.

NAVARRO, HENRY L.
NEJAL FREDRICK E.
NICOLAS, REYNALDO S.
NIEVES, RUFINO A.
OLAIVAR, SEBASTIAN T.

246.

RANADA, RODRIGO C.

247.

RARAS, ANTONIO A.

248.

RAVAL, VIOLETA V.

249.

RAZAL, BETTY R.

250.

REGALA, PONCE F.

251.
252.
253.
254.

257.

ROQUE, TERESITA S.

258.

ROSANES, MARILOU M.

259.

ROSETE, ADAN I.

260.

RUANTO, REY CRISTO C., JR.

265.

268.

SEKITO, COSME B JR.

269.

SIMON, RAMON P.

270.

SINGSON, MELENCIO C.

271.

SORIANO, ANGELO L.

272.

SORIANO, MAGDALENA R.

273.

SUNICO, ABELARDO T

274.

TABIJE, EMMA B.

275.

TAN, RUDY GOROSPE

276.

TAN, ESTER S.

277.

TAN, JULITA S.

278.

TECSON, BEATRIZ B.

279.

TOLENTINO, BENIGNO A.

280.

TURINGAN, ENRICO T JR.

281.

UMPA, ALI A.

282.

VALIC, LUCIO E.

283.

VASQUEZ, NICANOR B.

284.

VELARDE, EDGARDO C.

REYES, TELESPORO F.

ROCES, ROBERTO V.

264.

SATINA, PORFIRIO C.

REYES, NORMA Z.

256.

263.

267.

REYES, MANUEL E.

RIVERA, ROSITA L.

262.

SANTIAGO, EMELITA B.

REYES, LIBERATO R.

255.

261.

266.

SABLADA, PASCASIO G.
SALAZAR, SILVERIA S.
SALAZAR, VICTORIA A.
SALIMBACOD, PERLITA C.
SALMINGO, LOURDES M.

285.

VERA, AVELINO A.

286.

VERAME, OSCAR E.

287.

VIADO, LILIAN T.

288.

VIERNES, NAPOLEON K

289.

VILLALON, DENNIS A.

290.
291.

305.

MONTENEGRO, FRANSISCO M.

306.

OMEGA, PETRONILO T.

307.

SANTOS, GUILLERMO P.

308.

TEMPLO, CELSO

309.

VALDERAMA, JAIME B.

310.

VALDEZ, NORA M.

VILLAR, LUZ L.
VILLALUZ, EMELITO V.

292.

VILLAR, LUZ L.

293.

ZATA, ANGELA JR.

294.

ACHARON, CRISTETO

295.

ALBA, RENATO B.

296.

AMON, JULITA C.

297.

AUSTRIA, ERNESTO C.

298.

CALO, RAYMUNDO M.

299.

CENTENO, BENJAMIN R.

300.

DONATO, ESTELITA P.

301.

DONATO, FELIPE S

302.

FLORES, PEDRITO S.

303.

GALAROSA, RENATO

304.

MALAWI, MAUYAG

Cesar Dario is the petitioner in G.R. No. 81954; Vicente Feria, Jr.,
is the petitioner in G.R. No. 81967; Messrs. Adolfo Caserano
Pacifico Lagleva Julian C. Espiritu, Dennis A. Azarraga Renato
de Jesus, Nicasio C. Gamboa, Mesdames Corazon Rallos
Nieves and Felicitacion R. Geluz Messrs. Leodegario H.
Floresca, Subaer Pacasum Ms. Zenaida Lanaria Mr. Jose B.
Ortiz, Ms. Gliceria R. Dolar, Ms. Cornelia Napa, Pablo B. Santos,
Fermin Rodriguez, Ms. Daligay Bautista, Messrs. Leonardo Jose,
Alberto Lontok, Porfirio Tabino Jose Barredo, Roberto Arnaldo,
Ms. Ester Tan, Messrs. Pedro Bakal, Rosario David, Rodolfo
Afuang, Lorenzo Catre,, Ms. Leoncia Catre, and Roberto Abaca,
are the petitioners in G.R. No. 82023; the last 279 16 individuals
mentioned are the private respondents in G.R. No. 85310.
As far as the records will likewise reveal, 17 a total of 394 officials
and employees of the Bureau of Customs were given individual
notices of separation. A number supposedly sought
reinstatement with the Reorganization Appeals Board while
others went to the Civil Service Commission. The first thirty-one
mentioned above came directly to this Court.
On June 30, 1988, the Civil Service Commission promulgated its
ruling ordering the reinstatement of the 279 employees, the 279
private respondents in G.R. No. 85310, the dispositive portion of
which reads as follows:

WHEREFORE, it is hereby ordered that:

WHEREFORE, it is hereby ordered that:

1.
Appellants be immediately reappointed to positions of
comparable or equivalent rank in the Bureau of Customs without
loss of seniority rights;

1.
Appellants be immediately reappointed to positions of
comparable or equivalent rank in the Bureau of Customs without
loss of seniority rights; and

2.
Appellants be paid their back salaries reckoned from the
dates of their illegal termination based on the rates under the
approved new staffing pattern but not lower than their former
salaries.

2.
Appellants be paid their back salaries to be reckoned from
the date of their illegal termination based on the rates under the
approved new staffing pattern but not lower than their former
salaries.

This action of the Commission should not, however, be

interpreted as an exoneration of the appellants from any
accusation of wrongdoing and, therefore, their reappointments
are without prejudice to:

This action of the Commission should not, however, be

interpreted as an exoneration of the herein appellants from any
accusation of any wrongdoing and therefore, their
reappointments are without prejudice to:

1.
Proceeding with investigation of appellants with pending
administrative cases, and where investigations have been
finished, to promptly, render the appropriate decisions;

1.
Proceeding with investigation of appellants with pending
administrative cases, if any, and where investigations have been
finished, to promptly, render the appropriate decisions; and

2.
The filing of appropriate administrative complaints against
appellants with derogatory reports or information if evidence so
warrants.

2.
The filing of appropriate administrative complaints against
appellant with derogatory reports or information, if any, and if
evidence so warrants.

SO ORDERED. 18

SO ORDERED. 20

On July 15, 1988, Commissioner Mison, represented by the

Solicitor General, filed a motion for reconsideration Acting on the
motion, the Civil Service Commission, on September 20, 1988,
denied reconsideration. 19

On January 6, 1989, Commissioner Mison challenged the Civil

Service Commission's Resolution in this Court; his petitioner has
been docketed herein as G.R. No. 86241. The employees
ordered to be reinstated are Senen Dimaguila, Romeo Arabe,
Bemardo Quintong,Gregorio Reyes, and Romulo Badillo. 21

On October 20, 1988, Commissioner Mison instituted certiorari

proceedings with this Court, docketed, as above-stated, as G.R.
No. 85310 of this Court.
On November 16,1988, the Civil Service Commission further
disposed the appeal (from the resolution of the Reorganization
Appeals Board) of five more employees, holding as follows:

On June 10, 1988, Republic Act No. 6656, "AN ACT TO

PROTECT THE SECURITY OF TENURE OF CIVIL SERVICE
OFFICERS AND EMPLOYEES IN THE IMPLEMENTATION OF
GOVERNMENT REORGANIZATION," 22 was signed into law.
Under Section 7, thereof:

Sec. 9.
All officers and employees who are found by the
Civil Service Commission to have been separated in violation of
the provisions of this Act, shall be ordered reinstated or
reappointed as the case may be without loss of seniority and shall
be entitled to full pay for the period of separation. Unless also
separated for cause, all officers and employees, including
casuals and temporary employees, who have been separated
pursuant to reorganization shall, if entitled thereto, be paid the
appropriate separation pay and retirement and other benefits
under existing laws within ninety (90) days from the date of the
effectivity of their separation or from the date of the receipt of the
resolution of their appeals as the case may be: Provided, That
application for clearance has been filed and no action thereon has
been made by the corresponding department or agency. Those
who are not entitled to said benefits shall be paid a separation
gratuity in the amount equivalent to one (1) month salary for every
year of service. Such separation pay and retirement benefits shall
have priority of payment out of the savings of the department or
agency concerned. 23
On June 23, 1988, Benedicto Amasa and William Dionisio,
customs examiners appointed by Commissioner Mison pursuant
to the ostensible reorganization subject of this controversy,
petitioned the Court to contest the validity of the statute. The
petition is docketed as G.R. No. 83737.
On October 21, 1988, thirty-five more Customs officials whom the
Civil Service Commission had ordered reinstated by its June
30,1988 Resolution filed their own petition to compel the
Commissioner of Customs to comply with the said Resolution.
The petition is docketed as G.R. No. 85335.
On November 29, 1988, we resolved to consolidate all seven
petitions.
On the same date, we resolved to set the matter for hearing on
January 12, 1989. At the said hearing, the parties, represented
by their counsels (a) retired Justice Ruperto Martin; (b) retired
Justice Lino Patajo. (c) former Dean Froilan Bacungan (d) Atty.

Lester Escobar (e) Atty. Faustino Tugade and (f) Atty. Alexander
Padilla, presented their arguments. Solicitor General Francisco
Chavez argued on behalf of the Commissioner of Customs
(except in G.R. 85335, in which he represented the Bureau of
Customs and the Civil Service Commission).lwph1.t Former
Senator Ambrosio Padilla also appeared and argued as amicus
curiae Thereafter, we resolved to require the parties to submit
their respective memoranda which they did in due time.
There is no question that the administration may validly carry out
a government reorganization insofar as these cases are
concerned, the reorganization of the Bureau of Customs by
mandate not only of the Provisional Constitution, supra, but also
of the various Executive Orders decreed by the Chief Executive
in her capacity as sole lawmaking authority under the 1986-1987
revolutionary government. It should also be noted that under the
present Constitution, there is a recognition, albeit implied, that a
government reorganization may be legitimately undertaken,
subject to certain conditions. 24
The Court understands that the parties are agreed on the validity
of a reorganization per se the only question being, as shall be
later seen: What is the nature and extent of this government
reorganization?
The Court disregards the questions raised as to procedure, failure
to exhaust administrative remedies, the standing of certain
parties to sue, 25 and other technical objections, for two reasons,
"[b]ecause of the demands of public interest, including the need
for stability in the public service,"26 and because of the serious
implications of these cases on the administration of the Philippine
civil service and the rights of public servants.
The urgings in G.R. Nos. 85335 and 85310, that the Civil Service
Commission's Resolution dated June 30, 1988 had attained a
character of finality for failure of Commissioner Mison to apply for
judicial review or ask for reconsideration seasonalbly under
Presidential Decree No. 807, 27 or under Republic Act No. 6656,
28 or under the Constitution, 29 are likewise rejected. The

records show that the Bureau of Customs had until July 15, 1988
to ask for reconsideration or come to this Court pursuant to
Section 39 of Presidential Decree No. 807. The records likewise
show that the Solicitor General filed a motion for reconsideration
on July 15, 1988.30 The Civil Service Commission issued its
Resolution denying reconsideration on September 20, 1988; a
copy of this Resolution was received by the Bureau on
September 23, 1988.31 Hence the Bureau had until October 23,
1988 to elevate the matter on certiorari to this Court.32 Since the
Bureau's petition was filed on October 20, 1988, it was filed on
time.
We reject, finally, contentions that the Bureau's petition (in G.R.
85310) raises no jurisdictional questions, and is therefore bereft
of any basis as a petition for certiorari under Rule 65 of the Rules
of Court. 33 We find that the questions raised in Commissioner
Mison's petition (in G.R. 85310) are, indeed, proper for certiorari,
if by "jurisdictional questions" we mean questions having to do
with "an indifferent disregard of the law, arbitrariness and caprice,
or omission to weigh pertinent considerations, a decision arrived
at without rational deliberation, 34 as distinguished from
questions that require "digging into the merits and unearthing
errors of judgment 35 which is the office, on the other hand, of
review under Rule 45 of the said Rules. What cannot be denied
is the fact that the act of the Civil Service Commission of
reinstating hundreds of Customs employees Commissioner
Mison had separated, has implications not only on the entire
reorganization process decreed no less than by the Provisional
Constitution, but on the Philippine bureaucracy in general; these
implications are of such a magnitude that it cannot be said that
assuming that the Civil Service Commission erred the
Commission committed a plain "error of judgment" that Aratuc
says cannot be corrected by the extraordinary remedy of
certiorari or any special civil action. We reaffirm the teaching of
Aratuc as regards recourse to this Court with respect to rulings
of the Civil Service Commission which is that judgments of the
Commission may be brought to the Supreme Court through
certiorari alone, under Rule 65 of the Rules of Court.

In Aratuc we declared:
It is once evident from these constitutional and statutory
modifications that there is a definite tendency to enhance and
invigorate the role of the Commission on Elections as the
independent constitutional body charged with the safeguarding of
free, peaceful and honest elections. The framers of the new
Constitution must be presumed to have definite knowledge of
what it means to make the decisions, orders and rulings of the
Commission "subject to review by the Supreme Court'. And since
instead of maintaining that provision intact, it ordained that the
Commission's actuations be instead 'brought to the Supreme
Court on certiorari", We cannot insist that there was no intent to
change the nature of the remedy, considering that the limited
scope of certiorari, compared to a review, is well known in
remedial law.36
We observe no fundamental difference between the Commission
on Elections and the Civil Service Commission (or the
Commission on Audit for that matter) in terms of the constitutional
intent to leave the constitutional bodies alone in the enforcement
of laws relative to elections, with respect to the former, and the
civil service, with respect to the latter (or the audit of government
accounts, with respect to the Commission on Audit). As the poll
body is the "sole judge" 37 of all election cases, so is the Civil
Service Commission the single arbiter of all controversies
pertaining to the civil service.
It should also be noted that under the new Constitution, as under
the 1973 Charter, "any decision, order, or ruling of each
Commission may be brought to the Supreme Court on certiorari,"
38 which, as Aratuc tells us, "technically connotes something less
than saying that the same 'shall be subject to review by the
Supreme Court,' " 39 which in turn suggests an appeal by petition
for review under Rule 45. Therefore, our jurisdiction over cases
emanating from the Civil Service Commission is limited to
complaints of lack or excess of jurisdiction or grave abuse of
discretion tantamount to lack or excess of jurisdiction, complaints
that justify certiorari under Rule 65.

While Republic Act No. 6656 states that judgments of the

Commission are "final and executory"40 and hence,
unappealable, under Rule 65, certiorari precisely lies in the
absence of an appeal. 41
Accordingly, we accept Commissioner Mison petition (G.R. No.
85310) which clearly charges the Civil Service Commission with
grave abuse of discretion, a proper subject of certiorari, although
it may not have so stated in explicit terms.
As to charges that the said petition has been filed out of time, we
reiterate that it has been filed seasonably. It is to be stressed that
the Solicitor General had thirty days from September 23, 1988
(the date the Resolution, dated September 20,1988, of the Civil
Service Commission, denying reconsideration, was received) to
commence the instant certiorari proceedings. As we stated, under
the Constitution, an aggrieved party has thirty days within which
to challenge "any decision, order, or ruling" 42 of the
Commission. To say that the period should be counted from the
Solicitor's receipt of the main Resolution, dated June 30, 1988, is
to say that he should not have asked for reconsideration But to
say that is to deny him the right to contest (by a motion for
reconsideration) any ruling, other than the main decision, when,
precisely, the Constitution gives him such a right. That is also to
place him at a "no-win" situation because if he did not move for a
reconsideration, he would have been faulted for demanding
certiorari too early, under the general rule that a motion for
reconsideration should preface a resort to a special civil action.
43 Hence, we must reckon the thirty-day period from receipt of
the order of denial.
We come to the merits of these cases.

The petitioner in G.R. No. 81954, Cesar Dario was one of the
Deputy Commissioners of the Bureau of Customs until his relief
on orders of Commissioner Mison on January 26, 1988. In
essence, he questions the legality of his dismiss, which he
alleges was upon the authority of Section 59 of Executive Order
No. 127, supra, hereinbelow reproduced as follows:
SEC. 59.
New Structure and Pattern. Upon approval of this
Executive Order, the officers and employees of the Ministry shall,
in a holdover capacity, continue to perform their respective duties
and responsibilities and receive the corresponding salaries and
benefits unless in the meantime they are separated from
government service pursuant to Executive Order No. 17 (1986)
or Article III of the Freedom Constitution.
The new position structure and staffing pattern of the Ministry
shall be approved and prescribed by the Minister within one
hundred twenty (120) days from the approval of this Executive
Order and the authorized positions created hereunder shall be
filled with regular appointments by him or by the President, as the
case may be. Those incumbents whose positions are not
included therein or who are not reappointed shall be deemed
separated from the service. Those separated from the service
shall receive the retirement benefits to which they may be entitled
under existing laws, rules and regulations. Otherwise, they shall
be paid the equivalent of one month basic salary for every year
of service, or the equivalent nearest fraction thereof favorable to
them on the basis of highest salary received but in no case shall
such payment exceed the equivalent of 12 months salary.
No court or administrative body shall issue any writ of preliminary
injunction
or
restraining
order
to
enjoin
the
separation/replacement of any officer or employee effected under
this Executive Order.44

G.R. Nos. 81954, 81967, 82023, and 85335:

The Case for the Employees

a provision he claims the Commissioner could not have legally

invoked. He avers that he could not have been legally deemed to
be an "[incumbent] whose [position] [is] not included therein or
who [is] not reappointed"45 to justify his separation from the

service. He contends that neither the Executive Order (under the

second paragraph of the section) nor the staffing pattern
proposed by the Secretary of Finance 46 abolished the office of
Deputy Commissioner of Customs, but, rather, increased it to
three. 47 Nor can it be said, so he further maintains, that he had
not been "reappointed" 48 (under the second paragraph of the
section) because "[[r]eappointment therein presupposes that the
position to which it refers is a new one in lieu of that which has
been abolished or although an existing one, has absorbed that
which has been abolished." 49 He claims, finally, that under the
Provisional Constitution, the power to dismiss public officials
without cause ended on February 25, 1987,50 and that thereafter,
public officials enjoyed security of tenure under the provisions of
the 1987 Constitution.51
Like Dario Vicente Feria, the petitioner in G.R. No. 81967, was a
Deputy Commissioner at the Bureau until his separation directed
by Commissioner Mison. And like Dario he claims that under the
1987 Constitution, he has acquired security of tenure and that he
cannot be said to be covered by Section 59 of Executive Order
No. 127, having been appointed on April 22, 1986 during the
effectivity of the Provisional Constitution. He adds that under
Executive Order No. 39, "ENLARGING THE POWERS AND
FUNCTIONS OF THE COMMISSIONER OF CUSTOMS,"52 the
Commissioner of Customs has the power "[t]o appoint all Bureau
personnel, except those appointed by the President," 53 and that
his position, which is that of a Presidential appointee, is beyond
the control of Commissioner Mison for purposes of
reorganization.
The petitioners in G.R. No. 82023, collectors and examiners in
venous ports of the Philippines, say, on the other hand, that the
purpose of reorganization is to end corruption at the Bureau of
Customs and that since there is no finding that they are guilty of
corruption, they cannot be validly dismissed from the service.
The Case for Commissioner Mison

In his comments, the Commissioner relies on this Court's

resolution in Jose v. Arroyo54 in which the following statement
appears in the last paragraph thereof:
The contention of petitioner that Executive Order No. 127 is
violative of the provision of the 1987 Constitution guaranteeing
career civil service employees security of tenure overlooks the
provisions of Section 16, Article XVIII (Transitory Provisions)
which explicitly authorize the removal of career civil service
employees "not for cause but as a result of the reorganization
pursuant to Proclamation No. 3 dated March 25, 1986 and the
reorganization following the ratification of this Constitution." By
virtue of said provision, the reorganization of the Bureau of
Customs under Executive Order No. 127 may continue even after
the ratification of the Constitution, and career civil service
employees may be separated from the service without cause as
a result of such reorganization.55
For this reason, Mison posits, claims of violation of security of
tenure are allegedly no defense. He further states that the
deadline prescribed by the Provisional Constitution (February 25,
1987) has been superseded by the 1987 Constitution,
specifically, the transitory provisions thereof, 56 which allows a
reorganization thereafter (after February 25, 1987) as this very
Court has so declared in Jose v. Arroyo. Mison submits that
contrary to the employees' argument, Section 59 of Executive
Order No. 127 is applicable (in particular, to Dario and Feria in
the sense that retention in the Bureau, under the Executive Order,
depends on either retention of the position in the new staffing
pattern or reappointment of the incumbent, and since the
dismissed employees had not been reappointed, they had been
considered legally separated. Moreover, Mison proffers that
under Section 59 incumbents are considered on holdover status,
"which means that all those positions were considered vacant."
57 The Solicitor General denies the applicability of PalmaFernandez v. De la Paz 58 because that case supposedly
involved a mere transfer and not a separation. He rejects, finally,
the force and effect of Executive Order Nos. 17 and 39 for the
reason that Executive Order No. 17, which was meant to

implement the Provisional Constitution, 59 had ceased to have

force and effect upon the ratification of the 1987 Constitution, and
that, under Executive Order No. 39, the dismissals contemplated
were "for cause" while the separations now under question were
"not for cause" and were a result of government reorganize
organization decreed by Executive Order No. 127. Anent
Republic Act No. 6656, he expresses doubts on the
constitutionality of the grant of retroactivity therein (as regards the
reinforcement of security of tenure) since the new Constitution
clearly allows reorganization after its effectivity.
G.R. Nos. 85310 and 86241
The Position of Commissioner Mison
Commissioner's twin petitions are direct challenges to three
rulings of the Civil Service Commission: (1) the Resolution, dated
June 30, 1988, reinstating the 265 customs employees abovestated; (2) the Resolution, dated September 20, 1988, denying
reconsideration; and (3) the Resolution, dated November 16,
1988, reinstating five employees. The Commissioner's
arguments are as follows:
1.
The ongoing government reorganization is in the nature of
a "progressive" 60 reorganization "impelled by the need to
overhaul the entire government bureaucracy" 61 following the
people power revolution of 1986;
2.
There was faithful compliance by the Bureau of the various
guidelines issued by the President, in particular, as to
deliberation, and selection of personnel for appointment under
the new staffing pattern;
3.
The separated employees have been, under Section 59 of
Executive Order No. 127, on mere holdover standing, "which
means that all positions are declared vacant;" 62
4.
Jose v. Arroyo has declared the validity of Executive Order
No. 127 under the transitory provisions of the 1987 Constitution;

5.

Republic Act No. 6656 is of doubtful constitutionality.

The Ruling of the Civil Service Commission

The position of the Civil Service Commission is as follows:
1.
Reorganizations occur where there has been a reduction
in personnel or redundancy of functions; there is no showing that
the reorganization in question has been carried out for either
purpose on the contrary, the dismissals now disputed were
carried out by mere service of notices;
2.
The current Customs reorganization has not been made
according to Malaca;ang guidelines; information on file with the
Commission shows that Commissioner Mison has been
appointing unqualified personnel;
3.
Jose v. Arroyo, in validating Executive Order No. 127, did
not countenance illegal removals;
4.
Republic Act No. 6656 protects security of tenure in the
course of reorganizations.
The Court's ruling
Reorganization, Fundamental Principles of.
I.
The core provision of law involved is Section 16 Article XVIII, of
the 1987 Constitution. We quote:
Sec. 16.
Career civil service employees separated from the
service not for cause but as a result of the reorganization
pursuant to Proclamation No. 3 dated March 25, 1986 and the
reorganization following the ratification of this Constitution shag
be entitled to appropriate separation pay and to retirement and
other benefits accruing to them under the laws of general

application in force at the time of their separation. In lieul thereof,

at the option of the employees, they may be considered for
employment in the Government or in any of its subdivisions,
instrumentalities, or agencies, including government-owned or
controlled corporations and their subsidiaries. This provision also
applies to career officers whose resignation, tendered in line with
the existing policy, had been accepted. 63
The Court considers the above provision critical for two reasons:
(1) It is the only provision in so far as it mentions removals not
for cause that would arguably support the challenged
dismissals by mere notice, and (2) It is the single existing law on
reorganization after the ratification of the 1987 Charter, except
Republic Act No. 6656, which came much later, on June 10,
1988. [Nota been Executive Orders No. 116 (covering the
Ministry of Agriculture & Food), 117 (Ministry of Education,
Culture & Sports), 119 (Health), 120 (Tourism), 123 (Social
Welfare & Development), 124 (Public Works & Highways), 125
transportation & Communications), 126 (Labor & Employment),
127 (Finance), 128 (Science & Technology), 129 (Agrarian
Reform), 131 (Natural Resources), 132 (Foreign Affairs), and 133
(Trade & Industry) were all promulgated on January 30,1987,
prior to the adoption of the Constitution on February 2, 1987].64
It is also to be observed that unlike the grants of power to effect
reorganizations under the past Constitutions, the above provision
comes as a mere recognition of the right of the Government to
reorganize its offices, bureaus, and instrumentalities. Under
Section 4, Article XVI, of the 1935 Constitution:
Section 4. All officers and employees in the existing Government
of the Philippine Islands shall continue in office until the Congress
shall provide otherwise, but all officers whose appointments are
by this Constitution vested in the President shall vacate their
respective office(s) upon the appointment and qualification of
their successors, if such appointment is made within a period of
one year from the date of the inauguration of the Commonwealth
of the Philippines. 65

Under Section 9, Article XVII, of the 1973 Charter:

Section 9. All officials and employees in the existing Government
of the Republic of the Philippines shall continue in office until
otherwise provided by law or decreed by the incumbent President
of the Philippines, but all officials whose appointments are by this
Constitution vested in the Prime Minister shall vacate their
respective offices upon the appointment and qualification of their
successors. 66
The Freedom Constitution is, as earlier seen, couched in similar
language:
SECTION 2. All elective and appointive officials and employees
under the 1973 Constitution shall continue in office until otherwise
provided by proclamation or executive order or upon the
appointment and qualification of their successors, if such is made
within a period of one year from February 25, 1986.67
Other than references to "reorganization following the ratification
of this Constitution," there is no provision for "automatic"
vacancies under the 1987 Constitution.
Invariably, transition periods are characterized by provisions for
"automatic" vacancies. They are dictated by the need to hasten
the passage from the old to the new Constitution free from the
"fetters" of due process and security of tenure.
At this point, we must distinguish removals from separations
arising from abolition of office (not by virtue of the Constitution)
as a result of reorganization carried out by reason of economy or
to remove redundancy of functions. In the latter case, the
Government is obliged to prove good faith.68 In case of removals
undertaken to comply with clear and explicit constitutional
mandates, the Government is not hard put to prove anything,
plainly and simply because the Constitution allows it.
Evidently, the question is whether or not Section 16 of Article
XVIII of the 1987 Constitution is a grant of a license upon the

Government to remove career public officials it could have validly

done under an "automatic" vacancy-authority and to remove them
without rhyme or reason.
As we have seen, since 1935, transition periods have been
characterized by provisions for "automatic" vacancies. We take
the silence of the 1987 Constitution on this matter as a restraint
upon the Government to dismiss public servants at a moment's
notice.
What is, indeed, apparent is the fact that if the present Charter
envisioned an "automatic" vacancy, it should have said so in
clearer terms, as its 1935, 1973, and 1986 counterparts had so
stated.
The constitutional "lapse" means either one of two things: (1) The
Constitution meant to continue the reorganization under the prior
Charter (of the Revolutionary Government), in the sense that the
latter provides for "automatic" vacancies, or (2) It meant to put a
stop to those 'automatic" vacancies. By itself, however, it is
ambiguous, referring as it does to two stages of reorganization
the first, to its conferment or authorization under Proclamation
No. 3 (Freedom Charter) and the second, to its implementation
on its effectivity date (February 2, 1987).lwph1.t But as we
asserted, if the intent of Section 16 of Article XVIII of the 1987
Constitution were to extend the effects of reorganize tion under
the Freedom Constitution, it should have said so in clear terms. It
is illogical why it should talk of two phases of reorganization when
it could have simply acknowledged the continuing effect of the
first reorganization.
Second, plainly the concern of Section 16 is to ensure
compensation for victims" of constitutional revamps whether
under the Freedom or existing Constitution and only
secondarily and impliedly, to allow reorganization. We turn to the
records of the Constitutional Commission:
INQUIRY OF MR. PADILLA

On the query of Mr. Padilla whether there is a need for a specific

reference to Proclamation No. 3 and not merely state "result of
the reorganization following the ratification of this Constitution',
Mr. Suarez, on behalf of the Committee, replied that it is
necessary, inasmuch as there are two stages of reorganization
covered by the Section.
Mr. Padilla pointed out that since the proposal of the Commission
on Government Reorganization have not been implemented yet,
it would be better to use the phrase "reorganization before or after
the ratification of the Constitution' to simplify the Section. Mr.
Suarez instead suggested the phrase "as a result of the
reorganization effected before or after the ratification of the
Constitution' on the understanding that the provision would apply
to employees terminated because of the reorganization pursuant
to Proclamation No. 3 and even those affected by the
reorganization during the Marcos regime. Additionally, Mr.
Suarez pointed out that it is also for this reason that the
Committee specified the two Constitutions the Freedom
Constitution and the 1986 [1987] Constitution. 69
Simply, the provision benefits career civil service employees
separated from the service. And the separation contemplated
must be due to or the result of (1) the reorganization pursuant to
Proclamation No. 3 dated March 25, 1986, (2) the reorganization
from February 2, 1987, and (3) the resignations of career officers
tendered in line with the existing policy and which resignations
have been accepted. The phrase "not for cause" is clearly and
primarily exclusionary, to exclude those career civil service
employees separated "for cause." In other words, in order to be
entitled to the benefits granted under Section 16 of Article XVIII
of the Constitution of 1987, two requisites, one negative and the
other positive, must concur, to wit:
1.

the separation must not be for cause, and

2.
the separation must be due to any of the three situations
mentioned above.

By its terms, the authority to remove public officials under the

Provisional Constitution ended on February 25, 1987, advanced
by jurisprudence to February 2, 1987. 70 It Can only mean, then,
that whatever reorganization is taking place is upon the authority
of the present Charter, and necessarily, upon the mantle of its
provisions and safeguards. Hence, it can not be legitimately
stated that we are merely continuing what the revolutionary
Constitution of the Revolutionary Government had started. We
are through with reorganization under the Freedom Constitution
the first stage. We are on the second stage that inferred
from the provisions of Section 16 of Article XVIII of the permanent
basic document.
This is confirmed not only by the deliberations of the
Constitutional Commission, supra, but is apparent from the
Charter's own words. It also warrants our holding in Esguerra and
Palma-Fernandez, in which we categorically declared that after
February 2, 1987, incumbent officials and employees have
acquired security of tenure, which is not a deterrent against
separation by reorganization under the quondam fundamental
law.
Finally, there is the concern of the State to ensure that this
reorganization is no "purge" like the execrated reorganizations
under martial rule. And, of course, we also have the democratic
character of the Charter itself.
Commissioner Mison would have had a point, insofar as he
contends that the reorganization is open-ended ("progressive"),
had it been a reorganization under the revolutionary authority,
specifically of the Provisional Constitution. For then, the power to
remove government employees would have been truly wide
ranging and limitless, not only because Proclamation No. 3
permitted it, but because of the nature of revolutionary authority
itself, its totalitarian tendencies, and the monopoly of power in the
men and women who wield it.
What must be understood, however, is that notwithstanding her
immense revolutionary powers, the President was, nevertheless,

magnanimous in her rule. This is apparent from Executive Order

No. 17, which established safeguards against the strong arm and
ruthless propensity that accompanies reorganizations
notwithstanding the fact that removals arising therefrom were "not
for cause," and in spite of the fact that such removals would have
been valid and unquestionable. Despite that, the Chief Executive
saw, as we said, the "unnecessary anxiety and demoralization" in
the government rank and file that reorganization was causing,
and prescribed guidelines for personnel action. Specifically, she
said on May 28, 1986:
WHEREAS, in order to obviate unnecessary anxiety and
demoralization among the deserving officials and employees,
particularly in the career civil service, it is necessary to prescribe
the rules and regulations for implementing the said constitutional
provision to protect career civil servants whose qualifications and
performance meet the standards of service demanded by the
New Government, and to ensure that only those found corrupt,
inefficient and undeserving are separated from the government
service; 71
Noteworthy is the injunction embodied in the Executive Order that
dismissals should be made on the basis of findings of inefficiency,
graft, and unfitness to render public service.*
The President's Memorandum of October 14, 1987 should
furthermore be considered. We quote, in part:
Further to the Memorandum dated October 2, 1987 on the same
subject, I have ordered that there will be no further layoffs this
year of personnel as a result of the government reorganization.
72
Assuming, then, that this reorganization allows removals "not for
cause" in a manner that would have been permissible in a
revolutionary setting as Commissioner Mison so purports, it
would seem that the Commissioner would have been powerless,
in any event, to order dismissals at the Customs Bureau left and
right. Hence, even if we accepted his "progressive"

reorganization theory, he would still have to come to terms with

the Chief Executive's subsequent directives moderating the
revolutionary authority's plenary power to separate government
officials and employees.
Reorganization under the 1987 Constitution, Nature, Extent, and
Limitations of; Jose v. Arroyo, clarified.
The controversy seems to be that we have, ourselves,
supposedly extended the effects of government reorganization
under the Provisional Constitution to the regime of the 1987
Constitution. Jose v. Arroyo73 is said to be the authority for this
argument. Evidently, if Arroyo indeed so ruled, Arroyo would be
inconsistent with the earlier pronouncement of Esguerra and the
later holding of Palma-Fernandez. The question, however, is: Did
Arroyo, in fact, extend the effects of reorganization under the
revolutionary Charter to the era of the new Constitution?
There are a few points about Arroyo that have to be explained.
First, the opinion expressed therein that "[b]y virtue of said
provision the reorganization of the Bureau of Customs under
Executive Order No. 127 may continue even after the ratification
of this constitution and career civil service employees may be
separated from the service without cause as a result of such
reorganization" 74 is in the nature of an obiter dictum. We
dismissed Jose's petition 75 primarily because it was "clearly
premature, speculative, and purely anticipatory, based merely on
newspaper reports which do not show any direct or threatened
injury," 76 it appearing that the reorganization of the Bureau of
Customs had not been, then, set in motion. Jose therefore had
no cause for complaint, which was enough basis to dismiss the
petition. The remark anent separation "without cause" was
therefore not necessary for the disposition of the case. In Morales
v. Parades,77 it was held that an obiter dictum "lacks the force of
an adjudication and should not ordinarily be regarded as such."78
Secondly, Arroyo is an unsigned resolution while Palma
Fernandez is a full-blown decision, although both are en banc

cases. While a resolution of the Court is no less forceful than a

decision, the latter has a special weight.
Thirdly, Palma-Fernandez v. De la Paz comes as a later doctrine.
(Jose v. Arroyo was promulgated on August 11, 1987 while
Palma-Fernandez was decided on August 31, 1987.) It is wellestablished that a later judgment supersedes a prior one in case
of an inconsistency.
As we have suggested, the transitory provisions of the 1987
Constitution allude to two stages of the reorganization, the first
stage being the reorganization under Proclamation No. 3
which had already been consummated the second stage being
that adverted to in the transitory provisions themselves which
is underway. Hence, when we spoke, in Arroyo, of reorganization
after the effectivity of the new Constitution, we referred to the
second stage of the reorganization. Accordingly, we cannot be
said to have carried over reorganization under the Freedom
Constitution to its 1987 counterpart.
Finally, Arroyo is not necessarily incompatible with PalmaFernandez (or Esguerra).
As we have demonstrated, reorganization under the aegis of the
1987 Constitution is not as stern as reorganization under the prior
Charter. Whereas the latter, sans the President's subsequently
imposed constraints, envisioned a purgation, the same cannot be
said of the reorganization inferred under the new Constitution
because, precisely, the new Constitution seeks to usher in a
democratic regime. But even if we concede ex gratia argumenti
that Section 16 is an exception to due process and no-removal"except for cause provided by law" principles enshrined in the
very same 1987 Constitution, 79 which may possibly justify
removals "not for cause," there is no contradiction in terms here
because, while the former Constitution left the axe to fall where it
might, the present organic act requires that removals "not for
cause" must be as a result of reorganization. As we observed, the
Constitution does not provide for "automatic" vacancies. It must
also pass the test of good faith a test not obviously required

under the revolutionary government formerly prevailing, but a test

well-established in democratic societies and in this government
under a democratic Charter.
When, therefore, Arroyo permitted a reorganization under
Executive Order No. 127 after the ratification of the 1987
Constitution, Arroyo permitted a reorganization provided that it is
done in good faith. Otherwise, security of tenure would be an
insuperable implement. 80
Reorganizations in this jurisdiction have been regarded as valid
provided they are pursued in good faith. 81 As a general rule, a
reorganization is carried out in "good faith" if it is for the purpose
of economy or to make bureaucracy more efficient. In that event,
no dismissal (in case of a dismissal) or separation actually occurs
because the position itself ceases to exist. And in that case,
security of tenure would not be a Chinese wall. Be that as it may,
if the "abolition," which is nothing else but a separation or
removal, is done for political reasons or purposely to defeat sty of
tenure, or otherwise not in good faith, no valid "abolition' takes
place and whatever "abolition' is done, is void ab initio. There is
an invalid "abolition" as where there is merely a change of
nomenclature of positions, 82 or where claims of economy are
belied by the existence of ample funds. 83
It is to be stressed that by predisposing a reorganization to the
yardstick of good faith, we are not, as a consequence, imposing
a "cause" for restructuring. Retrenchment in the course of a
reorganization in good faith is still removal "not for cause," if by
"cause" we refer to "grounds" or conditions that call for
disciplinary action.**
Good faith, as a component of a reorganization under a
constitutional regime, is judged from the facts of each case.
However, under Republic Act No. 6656, we are told:
SEC. 2.
No officer or employee in the career service shall
be removed except for a valid cause and after due notice and
hearing. A valid cause for removal exists when, pursuant to a

bona fide reorganization, a position has been abolished or

rendered redundant or there is a need to merge, divide, or
consolidate positions in order to meet the exigencies of the
service, or other lawful causes allowed by the Civil Service Law.
The existence of any or some of the following circumstances may
be considered as evidence of bad faith in the removals made as
a result of reorganization, giving rise to a claim for reinstatement
or reappointment by an aggrieved party: (a) Where there is a
significant increase in the number of positions in the new staffing
pattern of the department or agency concerned; (b) Where an
office is abolished and another performing substantially the same
functions is created; (c) Where incumbents are replaced by those
less qualified in terms of status of appointment, performance and
merit; (d) Where there is a reclassification of offices in the
department or agency concerned and the reclassified offices
perform substantially the same functions as the original offices;
(e) Where the removal violates the order of separation provided
in Section 3 hereof. 84
It is in light hereof that we take up questions about Commissioner
Mison's good faith, or lack of it.
Reorganization of the Bureau of Customs,
Lack of Good Faith in.
The Court finds that after February 2, 1987 no perceptible
restructuring of the Customs hierarchy except for the change
of personnel has occurred, which would have justified (an
things being equal) the contested dismisses. The contention that
the staffing pattern at the Bureau (which would have furnished a
justification for a personnel movement) is the same s pattern
prescribed by Section 34 of Executive Order No. 127 already
prevailing when Commissioner Mison took over the Customs
helm, has not been successfully contradicted 85 There is no
showing that legitimate structural changes have been made or
a reorganization actually undertaken, for that matter at the
Bureau since Commissioner Mison assumed office, which would
have validly prompted him to hire and fire employees. There can
therefore be no actual reorganization to speak of, in the sense,

say, of reduction of personnel, consolidation of offices, or

abolition thereof by reason of economy or redundancy of
functions, but a revamp of personnel pure and simple.
The records indeed show that Commissioner Mison separated
about 394 Customs personnel but replaced them with 522 as of
August 18, 1988. 86 This betrays a clear intent to "pack" the
Bureau of Customs. He did so, furthermore, in defiance of the
President's directive to halt further layoffs as a consequence of
reorganization. 87 Finally, he was aware that layoffs should
observe the procedure laid down by Executive Order No. 17.
We are not, of course, striking down Executive Order No. 127 for
repugnancy to the Constitution. While the act is valid, still and all,
the means with which it was implemented is not. 88
Executive Order No. 127, Specific Case of.
With respect to Executive Order No. 127, Commissioner Mison
submits that under Section 59 thereof, "[t]hose incumbents
whose positions are not included therein or who are not
reappointed shall be deemed separated from the service." He
submits that because the 394 removed personnel have not been
"reappointed," they are considered terminated. To begin with, the
Commissioner's appointing power is subject to the provisions of
Executive Order No. 39. Under Executive Order No. 39, the
Commissioner of Customs may "appoint all Bureau personnel,
except those appointed by the President." 89
Accordingly, with respect to Deputy Commissioners Cesar Dario
and Vicente Feria, Jr., Commissioner Mison could not have
validly terminated them, they being Presidential appointees.
Secondly, and as we have asserted, Section 59 has been
rendered inoperative according to our holding in PalmaFernandez.
That Customs employees, under Section 59 of Executive Order
No. 127 had been on a mere holdover status cannot mean that

the positions held by them had become vacant. In PalmaFernandez, we said in no uncertain terms:
The argument that, on the basis of this provision, petitioner's term
of office ended on 30 January 1987 and that she continued in the
performance of her duties merely in a hold over capacity and
could be transferred to another position without violating any of
her legal rights, is untenable. The occupancy of a position in a
hold-over capacity was conceived to facilitate reorganization and
would have lapsed on 25 February 1987 (under the Provisional
Constitution), but advanced to February 2, 1987 when the 1987
Constitution became effective (De Leon. et al., vs. Hon. Benjamin
B. Esquerra, et. al., G.R. No. 78059, 31 August 1987). After the
said date the provisions of the latter on security of tenure govern.
90
It should be seen, finally, that we are not barring Commissioner
Mison from carrying out a reorganization under the transitory
provisions of the 1987 Constitution. But such a reorganization
should be subject to the criterion of good faith.
Resume.
In resume, we restate as follows:
1.
The President could have validly removed government
employees, elected or appointed, without cause but only before
the effectivity of the 1987 Constitution on February 2, 1987 (De
Leon v. Esguerra, supra; Palma-Fernandez vs. De la Paz, supra);
in this connection, Section 59 (on non-reappointment of
incumbents) of Executive Order No. 127 cannot be a basis for
termination;
2.
In such a case, dismissed employees shall be paid
separation and retirement benefits or upon their option be given
reemployment opportunities (CONST. [1987], art. XVIII, sec. 16;
Rep. Act No. 6656, sec. 9);

3.
From February 2, 1987, the State does not lose the right
to reorganize the Government resulting in the separation of
career civil service employees [CONST. (1987), supra] provided,
that such a reorganization is made in good faith. (Rep. Act No.
6656, supra.)

THE PETITIONS IN G.R. NOS. 81954, 81967, 82023, AND

85335 ARE GRANTED. THE PETITIONS IN G.R. NOS. 83737,
85310 AND 86241 ARE DISMISSED.

G.R. No. 83737

THE COMMISSIONER OF CUSTOMS IS ORDERED TO

REINSTATE THE EMPLOYEES SEPARATED AS A RESULT
OF HIS NOTICES DATED JANUARY 26, 1988.

This disposition also resolves G.R. No. 83737. As we have

indicated, G.R. No. 83737 is a challenge to the validity of
Republic Act No. 6656. In brief, it is argued that the Act, insofar
as it strengthens security of tenure 91 and as far as it provides for
a retroactive effect, 92 runs counter to the transitory provisions of
the new Constitution on removals not for cause.

THE EMPLOYEES WHOM COMMISSIONER MISON MAY

HAVE APPOINTED AS REPLACEMENTS ARE ORDERED TO
VACATE THEIR POSTS SUBJECT TO THE PAYMENT OF
WHATEVER BENEFITS THAT MAY BE PROVIDED BY LAW.
NO COSTS.

It can be seen that the Act, insofar as it provides for reinstatament

of employees separated without "a valid cause and after due
notice and hearing" 93 is not contrary to the transitory provisions
of the new Constitution. The Court reiterates that although the
Charter's transitory provisions mention separations "not for
cause," separations thereunder must nevertheless be on account
of a valid reorganization and which do not come about
automatically. Otherwise, security of tenure may be invoked.
Moreover, it can be seen that the statute itself recognizes
removals without cause. However, it also acknowledges the
possibility of the leadership using the artifice of reorganization to
frustrate security of tenure. For this reason, it has installed
safeguards. There is nothing unconstitutional about the Act.
We recognize the injury Commissioner Mison's replacements
would sustain. We also commisserate with them. But our concern
is the greater wrong inflicted on the dismissed employees on
account of their regal separation from the civil service.
WHEREFORE, THE RESOLUTIONS OF THE CIVIL SERVICE
COMMISSION, DATED JUNE 30, 1988, SEPTEMBER 20, 1988,
NOVEMBER 16, 1988, INVOLVED IN G.R. NOS. 85310, 85335,
AND 86241, AND MAY 8, 1989, INVOLVED IN G.R. NO. 85310,
ARE AFFIRMED.

IT IS SO ORDERED.

3. Buklod ng Kawaning EIIB v. Zamora

G.R. No. 142801-802. July 10, 2001]
BUKLOD NG KAWANING EIIB, CESAR POSADA, REMEDIOS
G. PRINCESA, BENJAMIN KHO, BENIGNO MANGA, LULU
MENDOZA, petitioners, vs. HON. EXECUTIVE SECRETARY
RONALDO B. ZAMORA, HON. SECRETARY JOSE PARDO,
DEPARTMENT OF FINANCE, HON. SECRETARY BENJAMIN
DIOKNO, DEPARTMENT OF BUDGET AND MANAGEMENT,
HON. SECRETARY ARTEMIO TUQUERO, DEPARTMENT OF
JUSTICE, respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
In this petition for certiorari, prohibition and mandamus,
petitioners Buklod Ng Kawaning EIIB, Cesar Posada, Remedios
Princesa, Benjamin Kho, Benigno Manga and Lulu Mendoza, for
themselves and in behalf of others with whom they share a
common or general interest, seek the nullification of Executive
Order No. 191[1] and Executive Order No. 223[2] on the ground
that they were issued by the Office of the President with grave
abuse of discretion and in violation of their constitutional right to
security of tenure.
The facts are undisputed:
On June 30, 1987, former President Corazon C. Aquino, issued
Executive Order No. 127[3] establishing the Economic
Intelligence and Investigation Bureau (EIIB) as part of the
structural organization of the Ministry of Finance.[4] The EIIB was
designated to perform the following functions:
(a) Receive, gather and evaluate intelligence reports and
information and evidence on the nature, modes and extent of
illegal activities affecting the national economy, such as, but not
limited to, economic sabotage, smuggling, tax evasion, and
dollar-salting, investigate the same and aid in the prosecution of
cases;

(b) Coordinate with external agencies in monitoring the financial

and economic activities of persons or entities, whether domestic
or foreign, which may adversely affect national financial interest
with the goal of regulating, controlling or preventing said activities;
(c) Provide all intelligence units of operating Bureaus or Offices
under the Ministry with the general framework and guidelines in
the conduct of intelligence and investigating works;
(d) Supervise, monitor and coordinate all the intelligence and
investigation operations of the operating Bureaus and Offices
under the Ministry;
(e) Investigate, hear and file, upon clearance by the Minister, antigraft and corruption cases against personnel of the Ministry and
its constituents units;
(f) Perform such other appropriate functions as may be assigned
by the Minister or his deputies.[5]
In a desire to achieve harmony of efforts and to prevent possible
conflicts among agencies in the course of their anti-smuggling
operations, President Aquino issued Memorandum Order No.
225 on March 17, 1989, providing, among others, that the EIIB
shall be the agency of primary responsibility for anti-smuggling
operations in all land areas and inland waters and waterways
outside the areas of sole jurisdiction of the Bureau of Customs.[6]
Eleven years after, or on January 7, 2000, President Joseph
Estrada issued Executive Order No. 191 entitled Deactivation of
the Economic Intelligence and Investigation Bureau.[7] Motivated
by the fact that the designated functions of the EIIB are also being
performed by the other existing agencies of the government and
that there is a need to constantly monitor the overlapping of
functions among these agencies, former President Estrada
ordered the deactivation of EIIB and the transfer of its functions
to the Bureau of Customs and the National Bureau of
Investigation.

Meanwhile, President Estrada issued Executive Order No. 196[8]

creating the Presidential Anti-Smuggling Task Force Aduana.[9]
Then the day feared by the EIIB employees came. On March 29,
2000, President Estrada issued Executive Order No. 223[10]
providing that all EIIB personnel occupying positions specified
therein shall be deemed separated from the service effective April
30, 2000, pursuant to a bona fide reorganization resulting to
abolition, redundancy, merger, division, or consolidation of
positions.[11]
Agonizing over the loss of their employment, petitioners now
come before this Court invoking our power of judicial review of
Executive Order Nos. 191 and 223. They anchor their petition on
the following arguments:
A
Executive Order Nos. 191 and 223 should be annulled as they
are unconstitutional for being violative of Section 2(3), Article IXB of the Philippine Constitution and/or for having been issued with
grave abuse of discretion amounting to lack or excess of
jurisdiction.
B.
The abolition of the EIIB is a hoax. Similarly, if Executive Order
Nos. 191 and 223 are considered to effect a reorganization of the
EIIB, such reorganization was made in bad faith.
C.
The President has no authority to abolish the EIIB.
Petitioners contend that the issuance of the afore-mentioned
executive orders is: (a) a violation of their right to security of
tenure; (b) tainted with bad faith as they were not actually
intended to make the bureaucracy more efficient but to give way

to Task Force Aduana, the functions of which are essentially and

substantially the same as that of EIIB; and (c) a usurpation of the
power of Congress to decide whether or not to abolish the EIIB.
Arguing in behalf of respondents, the Solicitor General maintains
that: (a) the President enjoys the totality of the executive power
provided under Sections 1 and 7, Article VII of the Constitution,
thus, he has the authority to issue Executive Order Nos. 191 and
223; (b) the said executive orders were issued in the interest of
national economy, to avoid duplicity of work and to streamline the
functions of the bureaucracy; and (c) the EIIB was not abolished,
it was only deactivated.
The petition is bereft of merit.
Despite the presence of some procedural flaws in the instant
petition, such as, petitioners disregard of the hierarchy of courts
and the non-exhaustion of administrative remedies, we deem it
necessary to address the issues. It is in the interest of the State
that questions relating to the status and existence of a public
office be settled without delay. We are not without precedent. In
Dario v. Mison,[12] we liberally decreed:
The Court disregards the questions raised as to procedure, failure
to exhaust administrative remedies, the standing of certain
parties to sue, for two reasons, `[b]ecause of the demands of
public interest, including the need for stability in the public
service,' and because of the serious implications of these cases
on the administration of the Philippine civil service and the rights
of public servants.
At first glance, it seems that the resolution of this case hinges on
the question - Does the deactivation of EIIB constitute abolition of
an office? However, after coming to terms with the prevailing law
and jurisprudence, we are certain that the ultimate queries should
be a) Does the President have the authority to reorganize the
executive department? and, b) How should the reorganization be
carried out?

Surely, there exists a distinction between the words deactivate

and abolish. To deactivate means to render inactive or ineffective
or to break up by discharging or reassigning personnel,[13] while
to abolish means to do away with, to annul, abrogate or destroy
completely.[14] In essence, abolition denotes an intention to do
away with the office wholly and permanently.[15] Thus, while in
abolition, the office ceases to exist, the same is not true in
deactivation where the office continues to exist, albeit remaining
dormant or inoperative. Be that as it may, deactivation and
abolition are both reorganization measures.
The Solicitor General only invokes the above distinctions on the
mistaken assumption that the President has no power to abolish
an office.
The general rule has always been that the power to abolish a
public office is lodged with the legislature.[16] This proceeds from
the legal precept that the power to create includes the power to
destroy. A public office is either created by the Constitution, by
statute, or by authority of law.[17] Thus, except where the office
was created by the Constitution itself, it may be abolished by the
same legislature that brought it into existence.[18]
The exception, however, is that as far as bureaus, agencies or
offices in the executive department are concerned, the Presidents
power of control may justify him to inactivate the functions of a
particular office,[19] or certain laws may grant him the broad
authority to carry out reorganization measures.[20] The case in
point is Larin v. Executive Secretary.[21] In this case, it was
argued that there is no law which empowers the President to
reorganize the BIR. In decreeing otherwise, this Court sustained
the following legal basis, thus:
Initially, it is argued that there is no law yet which empowers the
President to issue E.O. No. 132 or to reorganize the BIR.
We do not agree.
xxxxxx

Section 48 of R.A. 7645 provides that:

Sec. 48. Scaling Down and Phase Out of Activities of Agencies
Within the Executive Branch. The heads of departments, bureaus
and offices and agencies are hereby directed to identify their
respective activities which are no longer essential in the delivery
of public services and which may be scaled down, phased out or
abolished, subject to civil service rules and regulations. X x x.
Actual scaling down, phasing out or abolition of the activities shall
be effected pursuant to Circulars or Orders issued for the purpose
by the Office of the President.
Said provision clearly mentions the acts of scaling down, phasing
out and abolition of offices only and does not cover the creation
of offices or transfer of functions. Nevertheless, the act of creating
and decentralizing is included in the subsequent provision of
Section 62 which provides that:
Sec. 62. Unauthorized organizational charges.- Unless otherwise
created by law or directed by the President of the Philippines, no
organizational unit or changes in key positions in any department
or agency shall be authorized in their respective organization
structures and be funded from appropriations by this Act. (italics
ours)
The foregoing provision evidently shows that the President is
authorized to effect organizational changes including the creation
of offices in the department or agency concerned.
xxxxxx
Another legal basis of E.O. No. 132 is Section 20, Book III of E.O.
No. 292 which states:
Sec. 20. Residual Powers. Unless Congress provides otherwise,
the President shall exercise such other powers and functions
vested in the President which are provided for under the laws and

which are not specifically enumerated above or which are not

delegated by the President in accordance with law. (italic ours)
This provision speaks of such other powers vested in the
President under the law. What law then gives him the power to
reorganize? It is Presidential Decree No. 1772 which amended
Presidential Decree No. 1416. These decrees expressly grant the
President of the Philippines the continuing authority to reorganize
the national government, which includes the power to group,
consolidate bureaus and agencies, to abolish offices, to transfer
functions, to create and classify functions, services and activities
and to standardize salaries and materials. The validity of these
two decrees are unquestionable. The 1987 Constitution clearly
provides that all laws, decrees, executive orders, proclamations,
letters of instructions and other executive issuances not
inconsistent with this Constitution shall remain operative until
amended, repealed or revoked. So far, there is yet no law
amending or repealing said decrees. (Emphasis supplied)
Now, let us take a look at the assailed executive order.
In the whereas clause of E.O. No. 191, former President Estrada
anchored his authority to deactivate EIIB on Section 77 of
Republic Act 8745 (FY 1999 General Appropriations Act), a
provision similar to Section 62 of R.A. 7645 quoted in Larin, thus;
Sec. 77. Organized Changes. Unless otherwise provided by law
or directed by the President of the Philippines, no changes in key
positions or organizational units in any department or agency
shall be authorized in their respective organizational structures
and funded from appropriations provided by this Act.
We adhere to the precedent or ruling in Larin that this provision
recognizes the authority of the President to effect organizational
changes in the department or agency under the executive
structure. Such a ruling further finds support in Section 78 of
Republic Act No. 8760.[22] Under this law, the heads of
departments, bureaus, offices and agencies and other entities in
the Executive Branch are directed (a) to conduct a

comprehensive review of their respective mandates, missions,

objectives, functions, programs, projects, activities and systems
and procedures; (b) identify activities which are no longer
essential in the delivery of public services and which may be
scaled down, phased-out or abolished; and (c) adopt measures
that will result in the streamlined organization and improved
overall performance of their respective agencies.[23] Section 78
ends up with the mandate that the actual streamlining and
productivity improvement in agency organization and operation
shall be effected pursuant to Circulars or Orders issued for the
purpose by the Office of the President.[24] The law has spoken
clearly. We are left only with the duty to sustain.
But of course, the list of legal basis authorizing the President to
reorganize any department or agency in the executive branch
does not have to end here. We must not lose sight of the very
source of the power that which constitutes an express grant of
power. Under Section 31, Book III of Executive Order No. 292
(otherwise known as the Administrative Code of 1987), the
President, subject to the policy in the Executive Office and in
order to achieve simplicity, economy and efficiency, shall have
the continuing authority to reorganize the administrative structure
of the Office of the President. For this purpose, he may transfer
the functions of other Departments or Agencies to the Office of
the President. In Canonizado v. Aguirre,[25] we ruled that
reorganization involves the reduction of personnel, consolidation
of offices, or abolition thereof by reason of economy or
redundancy of functions. It takes place when there is an alteration
of the existing structure of government offices or units therein,
including the lines of control, authority and responsibility between
them. The EIIB is a bureau attached to the Department of
Finance.[26] It falls under the Office of the President. Hence, it is
subject to the Presidents continuing authority to reorganize.
It having been duly established that the President has the
authority to carry out reorganization in any branch or agency of
the executive department, what is then left for us to resolve is
whether or not the reorganization is valid. In this jurisdiction,
reorganizations have been regarded as valid provided they are

pursued in good faith. Reorganization is carried out in good faith

if it is for the purpose of economy or to make bureaucracy more
efficient.[27] Pertinently, Republic Act No. 6656[28] provides for
the circumstances which may be considered as evidence of bad
faith in the removal of civil service employees made as a result of
reorganization, to wit: (a) where there is a significant increase in
the number of positions in the new staffing pattern of the
department or agency concerned; (b) where an office is abolished
and another performing substantially the same functions is
created; (c) where incumbents are replaced by those less
qualified in terms of status of appointment, performance and
merit; (d) where there is a classification of offices in the
department or agency concerned and the reclassified offices
perform substantially the same functions as the original offices,
and (e) where the removal violates the order of separation.[29]
Petitioners claim that the deactivation of EIIB was done in bad
faith because four days after its deactivation, President Estrada
created the Task Force Aduana.
We are not convinced.
An examination of the pertinent Executive Orders[30] shows that
the deactivation of EIIB and the creation of Task Force Aduana
were done in good faith. It was not for the purpose of removing
the EIIB employees, but to achieve the ultimate purpose of E.O.
No. 191, which is economy. While Task Force Aduana was
created to take the place of EIIB, its creation does not entail
expense to the government.
Firstly, there is no employment of new personnel to man the Task
Force. E.O. No. 196 provides that the technical, administrative
and special staffs of EIIB are to be composed of people who are
already in the public service, they being employees of other
existing agencies. Their tenure with the Task Force would only be
temporary, i.e., only when the agency where they belong is called
upon to assist the Task Force. Since their employment with the
Task force is only by way of detail or assignment, they retain their

employment with the existing agencies. And should the need for
them cease, they would be sent back to the agency concerned.
Secondly, the thrust of E.O. No. 196 is to have a small group of
military men under the direct control and supervision of the
President as base of the governments anti-smuggling campaign.
Such a smaller base has the necessary powers 1) to enlist the
assistance of any department, bureau, or office and to use their
respective personnel, facilities and resources; and 2) to select
and recruit personnel from within the PSG and ISAFP for
assignment to the Task Force. Obviously, the idea is to
encourage the utilization of personnel, facilities and resources of
the already existing departments, agencies, bureaus, etc.,
instead of maintaining an independent office with a whole set of
personnel and facilities. The EIIB had proven itself burdensome
for the government because it maintained separate offices in
every region in the Philippines.
And thirdly, it is evident from the yearly budget appropriation of
the government that the creation of the Task Force Aduana was
especially intended to lessen EIIBs expenses. Tracing from the
yearly General Appropriations Act, it appears that the allotted
amount for the EIIBs general administration, support, and
operations for the year 1995, was P128,031,000;[31] for 1996,
P182,156,000;[32] for 1998, P219,889,000;[33] and, for 1999,
P238,743,000.[34] These amounts were far above the
P50,000,000[35] allocation to the Task Force Aduana for the year
2000.
While basically, the functions of the EIIB have devolved upon the
Task Force Aduana, we find the latter to have additional new
powers. The Task Force Aduana, being composed of elements
from the Presidential Security Group (PSG) and Intelligence
Service Armed Forces of the Philippines (ISAFP),[36] has the
essential power to effect searches, seizures and arrests. The EIIB
did not have this power. The Task Force Aduana has the power
to enlist the assistance of any department, bureau, office, or
instrumentality of the government, including government-owned
or controlled corporations; and to use their personnel, facilities

and resources. Again, the EIIB did not have this power. And, the
Task Force Aduana has the additional authority to conduct
investigation of cases involving ill-gotten wealth. This was not
expressly granted to the EIIB.
Consequently, it cannot be said that there is a feigned
reorganization. In Blaquera v. Civil Sevice Commission, [37] we
ruled that a reorganization in good faith is one designed to trim
the fat off the bureaucracy and institute economy and greater
efficiency in its operation.
Lastly, we hold that petitioners right to security of tenure is not
violated. Nothing is better settled in our law than that the abolition
of an office within the competence of a legitimate body if done in
good faith suffers from no infirmity. Valid abolition of offices is
neither removal nor separation of the incumbents.[38] In the
instructive words laid down by this Court in Dario v. Mison,[39]
through Justice Abraham F. Sarmiento:
Reorganizations in this jurisdiction have been regarded as valid
provided they are pursued in good faith. As a general rule, a
reorganization is carried out in good faith if it is for the purpose of
economy or to make bureaucracy more efficient. In that event, no
dismissal (in case of dismissal) or separation actually occurs
because the position itself ceases to exist. And in that case,
security of tenure would not be a Chinese wall. Be that as it may,
if the abolition, which is nothing else but a separation or removal,
is done for political reasons or purposely to defeat security of
tenure, otherwise not in good faith, no valid abolition takes and
whatever abolition is done, is void ab initio. There is an invalid
abolition as where there is merely a change of nomenclature of
positions, or where claims of economy are belied by the existence
of ample funds.
Indeed, there is no such thing as an absolute right to hold office.
Except constitutional offices which provide for special immunity
as regards salary and tenure, no one can be said to have any
vested right in an office or its salary.[40]

While we cast a commiserating look upon the plight of all the EIIB
employees whose lives perhaps are now torn with uncertainties,
we cannot ignore the unfortunate reality that our government is
also battling the impact of a plummeting economy. Unless the
government is given the chance to recuperate by instituting
economy and efficiency in its system, the EIIB will not be the last
agency to suffer the impact. We cannot frustrate valid measures
which are designed to rebuild the executive department.
WHEREFORE, the petition is hereby DENIED. No costs.
SO ORDERED.

4. Bagaoisan v. NTA
[G.R. No. 152845. August 5, 2003]
DRIANITA BAGAOISAN, FELY MADRIAGA, SHIRLY
TAGABAN, RICARDO SARANDI, SUSAN IMPERIAL,
BENJAMIN DEMDEM, RODOLFO DAGA, EDGARDO BACLIG,
GREGORIO LABAYAN, HILARIO JEREZ, and MARIA
CORAZON CUANANG, petitioners, vs. NATIONAL TOBACCO
ADMINISTRATION, represented by ANTONIO DE GUZMAN and
PERLITA BAULA, respondents.
DECISION
VITUG, J.:
President Joseph Estrada issued on 30 September 1998
Executive Order No. 29, entitled Mandating the Streamlining of
the National Tobacco Administration (NTA), a government
agency under the Department of Agriculture. The order was
followed by another issuance, on 27 October 1998, by President
Estrada of Executive Order No. 36, amending Executive Order
No. 29, insofar as the new staffing pattern was concerned, by
increasing from four hundred (400) to not exceeding seven
hundred fifty (750) the positions affected thereby. In compliance
therewith, the NTA prepared and adopted a new Organization
Structure and Staffing Pattern (OSSP) which, on 29 October
1998, was submitted to the Office of the President.
On 11 November 1998, the rank and file employees of NTA
Batac, among whom included herein petitioners, filed a letterappeal with the Civil Service Commission and sought its
assistance in recalling the OSSP. On 04 December 1998, the
OSSP was approved by the Department of Budget and
Management (DBM) subject to certain revisions. On even date,
the NTA created a placement committee to assist the appointing
authority in the selection and placement of permanent personnel
in the revised OSSP. The results of the evaluation by the
committee on the individual qualifications of applicants to the
positions in the new OSSP were then disseminated and posted
at the central and provincial offices of the NTA.

On 10 June 1996, petitioners, all occupying different positions at

the NTA office in Batac, Ilocos Norte, received individual notices
of termination of their employment with the NTA effective thirty
(30) days from receipt thereof. Finding themselves without any
immediate relief from their dismissal from the service, petitioners
filed a petition for certiorari, prohibition and mandamus, with
prayer for preliminary mandatory injunction and/or temporary
restraining order, with the Regional Trial Court (RTC) of Batac,
Ilocos Norte, and prayed 1) that a restraining order be immediately issued enjoining the
respondents from enforcing the notice of termination addressed
individually to the petitioners and/or from committing further acts
of dispossession and/or ousting the petitioners from their
respective offices;
2) that a writ of preliminary injunction be issued against the
respondents, commanding them to maintain the status quo to
protect the rights of the petitioners pending the determination of
the validity of the implementation of their dismissal from the
service; and
3) that, after trial on the merits, judgment be rendered declaring
the notice of termination of the petitioners illegal and the
reorganization null and void and ordering their reinstatement with
backwages, if applicable, commanding the respondents to desist
from further terminating their services, and making the injunction
permanent.[1]
The RTC, on 09 September 2000, ordered the NTA to appoint
petitioners in the new OSSP to positions similar or comparable to
their respective former assignments. A motion for reconsideration
filed by the NTA was denied by the trial court in its order of 28
February 2001. Thereupon, the NTA filed an appeal with the
Court of Appeals, raising the following issues:

I. Whether or not respondents submitted evidence as proof that

petitioners, individually, were not the best qualified and most
deserving among the incumbent applicant-employees.
II. Whether or not incumbent permanent employees, including
herein petitioners, automatically enjoy a preferential right and the
right of first refusal to appointments/reappointments in the new
Organization Structure And Staffing Pattern (OSSP) of
respondent NTA.
III. Whether or not respondent NTA in implementing the
mandated reorganization pursuant to E.O. No. 29, as amended
by E.O. No. 36, strictly adhere to the implementing rules on
reorganization, particularly RA 6656 and of the Civil Service
Commission Rules on Government Reorganization.
IV. Whether or not the validity of E.O. Nos. 29 and 36 can be put
in issue in the instant case/appeal.[2]
On 20 February 2002, the appellate court rendered a decision
reversing and setting aside the assailed orders of the trial court.
Petitioners went to this Court to assail the decision of the Court
of Appeals, contending that I. The Court of Appeals erred in making a finding that went
beyond the issues of the case and which are contrary to those of
the trial court and that it overlooked certain relevant facts not
disputed by the parties and which, if properly considered, would
justify a different conclusion;
II. The Court of Appeals erred in upholding Executive Order Nos.
29 and 36 of the Office of the President which are mere
administrative issuances which do not have the force and effect
of a law to warrant abolition of positions and/or effecting total
reorganization;
III. The Court of Appeals erred in holding that petitioners removal
from the service is in accordance with law;

IV. The Court of Appeals erred in holding that respondent NTA

was not guilty of bad faith in the termination of the services of
petitioners; (and)
V. The Court of Appeals erred in ignoring case law/jurisprudence
in the abolition of an office.[3]
In its resolution of 10 July 2002, the Court required the NTA to file
its comment on the petition. On 18 November 2002, after the NTA
had filed its comment of 23 September 2002, the Court issued its
resolution denying the petition for failure of petitioners to
sufficiently show any reversible error on the part of the appellate
court in its challenged decision so as to warrant the exercise by
this Court of its discretionary appellate jurisdiction. A motion for
reconsideration filed by petitioners was denied in the Courts
resolution of 20 January 2002.
On 21 February 2003, petitioners submitted a Motion to Admit
Petition For En Banc Resolution of the case allegedly to address
a basic question, i.e., the legal and constitutional issue on
whether the NTA may be reorganized by an executive fiat, not by
legislative action.[4] In their Petition for an En Banc Resolution
petitioners would have it that 1. The Court of Appeals decision upholding the reorganization of
the National Tobacco Administration sets a dangerous precedent
in that:
a) A mere Executive Order issued by the Office of the President
and procured by a government functionary would have the effect
of a blanket authority to reorganize a bureau, office or agency
attached to the various executive departments;
b) The President of the Philippines would have the plenary power
to reorganize the entire government Bureaucracy through the
issuance of an Executive Order, an administrative issuance
without the benefit of due deliberation, debate and discussion of
members of both chambers of the Congress of the Philippines;

c) The right to security of tenure to a career position created by

law or statute would be defeated by the mere adoption of an
Organizational Structure and Staffing Pattern issued pursuant to
an Executive Order which is not a law and could thus not abolish
an office created by law;
2. The case law on abolition of an office would be disregarded,
ignored and abandoned if the Court of Appeals decision subject
matter of this Petition would remain undisturbed and untouched.
In other words, previous doctrines and precedents of this Highest
Court would in effect be reversed and/or modified with the Court
of Appeals judgment, should it remain unchallenged.
3. Section 4 of Executive Order No. 245 dated July 24, 1987
(Annex D, Petition), issued by the Revolutionary government of
former President Corazon Aquino, and the law creating NTA,
which provides that the governing body of NTA is the Board of
Directors, would be rendered meaningless, ineffective and a dead
letter law because the challenged NTA reorganization which was
erroneously upheld by the Court of Appeals was adopted and
implemented by then NTA Administrator Antonio de Guzman
without the corresponding authority from the Board of Directors
as mandated therein. In brief, the reorganization is an ultra vires
act of the NTA Administrator.
4. The challenged Executive Order No. 29 issued by former
President Joseph Estrada but unsigned by then Executive
Secretary Ronaldo Zamora would in effect be erroneously upheld
and given legal effect as to supersede, amend and/or modify
Executive Order No. 245, a law issued during the Freedom
Constitution of President Corazon Aquino. In brief, a mere
executive order would amend, supersede and/or render
ineffective a law or statute.[5]
In order to allow the parties a full opportunity to ventilate their
views on the matter, the Court ultimately resolved to hear the
parties in oral argument. Essentially, the core question raised by
them is whether or not the President, through the issuance of an

executive order, can validly carry out the reorganization of the

NTA.
Notwithstanding the apparent procedural lapse on the part of
petitioner to implead the Office of the President as party
respondent pursuant to Section 7, Rule 3, of the 1997 Revised
Rules of Civil Procedure, [6] this Court resolved to rule on the
merits of the petition.
Buklod ng Kawaning EIIB vs. Zamora[7] ruled that the President,
based on existing laws, had the authority to carry out a
reorganization in any branch or agency of the executive
department. In said case, Buklod ng Kawaning EIIB challenged
the issuance, and sought the nullification, of Executive Order No.
191 (Deactivation of the Economic Intelligence and Investigation
Bureau) and Executive Order No. 223 (Supplementary Executive
Order No. 191 on the Deactivation of the Economic Intelligence
and Investigation Bureau and for Other Matters) on the ground
that they were issued by the President with grave abuse of
discretion and in violation of their constitutional right to security of
tenure. The Court explained:
The general rule has always been that the power to abolish a
public office is lodged with the legislature. This proceeds from the
legal precept that the power to create includes the power to
destroy. A public office is either created by the Constitution, by
statute, or by authority of law. Thus, except where the office was
created by the Constitution itself, it may be abolished by the same
legislature that brought it into existence.
The exception, however, is that as far as bureaus, agencies or
offices in the executive department are concerned, the Presidents
power of control may justify him to inactivate the functions of a
particular office, or certain laws may grant him the broad authority
to carry out reorganization measures. The case in point is Larin
v. Executive Secretary [280 SCRA 713]. In this case, it was
argued that there is no law which empowers the President to
reorganize the BIR. In decreeing otherwise, this Court sustained
the following legal basis, thus:

`Initially, it is argued that there is no law yet which empowers the

President to issue E.O. No. 132 or to reorganize the BIR.
`We do not agree.
`x x x x x x

`Another legal basis of E.O. No. 132 is Section 20, Book III of
E.O. No. 292 which states:
``Sec. 20. Residual Powers. Unless Congress provides
otherwise, the President shall exercise such other powers and
functions vested in the President which are provided for under the
laws and which are not specifically enumerated above or which
are not delegated by the President in accordance with law.

`Section 48 of R.A. 7645 provides that:

``Sec. 48. Scaling Down and Phase Out of Activities of Agencies
Within the Executive Branch. The heads of departments, bureaus
and offices and agencies are hereby directed to identify their
respective activities which are no longer essential in the delivery
of public services and which may be scaled down, phased out or
abolished, subject to civil service rules and regulations. x x x.
Actual scaling down, phasing out or abolition of the activities shall
be effected pursuant to Circulars or Orders issued for the purpose
by the Office of the President.
`Said provision clearly mentions the acts of `scaling down,
phasing out and abolition of offices only and does not cover the
creation of offices or transfer of functions. Nevertheless, the act
of creating and decentralizing is included in the subsequent
provision of Section 62 which provides that:

`This provision speaks of such other powers vested in the

President under the law. What law then gives him the power to
reorganize? It is Presidential Decree No. 1772 which amended
Presidential Decree No. 1416. These decrees expressly grant the
President of the Philippines the continuing authority to reorganize
the national government, which includes the power to group,
consolidate bureaus and agencies, to abolish offices, to transfer
functions, to create and classify functions, services and activities
and to standardize salaries and materials. The validity of these
two decrees are unquestionable. The 1987 Constitution clearly
provides that `all laws, decrees, executive orders, proclamations,
letter of instructions and other executive issuances not
inconsistent with this Constitution shall remain operative until
amended, repealed or revoked. So far, there is yet no law
amending or repealing said decrees.
Now, let us take a look at the assailed executive order.

``Sec. 62. Unauthorized organizational changes. Unless

otherwise created by law or directed by the President of the
Philippines, no organizational unit or changes in key positions in
any department or agency shall be authorized in their respective
organization structures and be funded from appropriations by this
Act.

In the whereas clause of E.O. No. 191, former President Estrada

anchored his authority to deactivate EIIB on Section 77 of
Republic Act 8745 (FY 1999 General Appropriations Act), a
provision similar to Section 62 of R.A. 7645 quoted in Larin, thus:

`The foregoing provision evidently shows that the President is

authorized to effect organizational changes including the creation
of offices in the department or agency concerned.

`Sec. 77. Organized Changes. Unless otherwise provided by law

or directed by the President of the Philippines, no changes in key
positions or organizational units in any department or agency
shall be authorized in their respective organizational structures
and funded from appropriations provided by this Act.

`x x x x x x

We adhere to the x x x ruling in Larin that this provision

recognizes the authority of the President to effect organizational
changes in the department or agency under the executive
structure. Such a ruling further finds support in Section 78 of
Republic Act No. 8760. Under this law, the heads of departments,
bureaus, offices and agencies and other entities in the Executive
Branch are directed (a) to conduct a comprehensive review of this
respective mandates, missions, objectives, functions, programs,
projects, activities and systems and procedures; (b) identify
activities which are no longer essential in the delivery of public
services and which may be scaled down, phased-out or
abolished; and (c) adopt measures that will result in the
streamlined organization and improved overall performance of
their respective agencies. Section 78 ends up with the mandate
that the actual streamlining and productivity improvement in
agency organization and operation shall be effected pursuant to
Circulars or Orders issued for the purpose by the Office of the
President. The law has spoken clearly. We are left only with the
duty to sustain.
But of course, the list of legal basis authorizing the President to
reorganize any department or agency in the executive branch
does not have to end here. We must not lose sight of the very
source of the power that which constitutes an express grant of
power. Under Section 31, Book III of Executive Order No. 292
(otherwise known as the Administrative Code of 1987), the
President, subject to the policy in the Executive Office and in
order to achieve simplicity, economy and efficiency, shall have
the continuing authority to reorganize the administrative structure
of the Office of the President. For this purpose, he may transfer
the functions of other Departments or Agencies to the Office of
the President. In Canonizado vs. Aguirre [323 SCRA 312], we
ruled that reorganization involves the reduction of personnel,
consolidation of offices, or abolition thereof by reason of economy
or redundancy of functions. It takes place when there is an
alteration of the existing structure of government offices or units
therein, including the lines of control, authority and responsibility
between them. The EIIB is a bureau attached to the Department

of Finance. It falls under the Office of the President. Hence, it is

subject to the Presidents continuing authority to reorganize.
It having been duly established that the President has the
authority to carry out reorganization in any branch or agency of
the executive department, what is then left for us to resolve is
whether or not the reorganization is valid. In this jurisdiction,
reorganizations have been regarded as valid provided they are
pursued in good faith. Reorganization is carried out in `good faith
if it is for the purpose of economy or to make bureaucracy more
efficient. Pertinently, Republic Act No. 6656 provides for the
circumstances which may be considered as evidence of bad faith
in the removal of civil service employees made as a result of
reorganization, to wit: (a) where there is a significant increase in
the number of positions in the new staffing pattern of the
department or agency concerned; (b) where an office is abolished
and another performing substantially the same functions is
created; (c) where incumbents are replaced by those less
qualified in terms of status of appointment, performance and
merit; (d) where there is a classification of offices in the
department or agency concerned and the reclassified offices
perform substantially the same functions as the original offices,
and (e) where the removal violates the order of separation.[8]
The Court of Appeals, in its now assailed decision, has found no
evidence of bad faith on the part of the NTA; thus In the case at bar, we find no evidence that the respondents
committed bad faith in issuing the notices of non-appointment to
the petitioners.
Firstly, the number of positions in the new staffing pattern did not
increase. Rather, it decreased from 1,125 positions to 750. It is
thus natural that ones position may be lost through the removal
or abolition of an office.
Secondly, the petitioners failed to specifically show which offices
were abolished and the new ones that were created performing
substantially the same functions.

Thirdly, the petitioners likewise failed to prove that less qualified

employees were appointed to the positions to which they applied.
x x x x x x x x x.
Fourthly, the preference stated in Section 4 of R.A. 6656, only
means that old employees should be considered first, but it does
not necessarily follow that they should then automatically be
appointed. This is because the law does not preclude the infusion
of new blood, younger dynamism, or necessary talents into the
government service, provided that the acts of the appointing
power are bonafide for the best interest of the public service and
the person chosen has the needed qualifications.[9]
These findings of the appellate court are basically factual which
this Court must respect and be held bound.
It is important to emphasize that the questioned Executive Orders
No. 29 and No. 36 have not abolished the National Tobacco
Administration but merely mandated its reorganization through
the streamlining or reduction of its personnel. Article VII, Section
17,[10] of the Constitution, expressly grants the President control
of all executive departments, bureaus, agencies and offices
which may justify an executive action to inactivate the functions
of a particular office or to carry out reorganization measures
under a broad authority of law.[11] Section 78 of the General
Provisions of Republic Act No. 8522 (General Appropriations Act
of FY 1998) has decreed that the President may direct changes
in the organization and key positions in any department, bureau
or agency pursuant to Article VI, Section 25,[12] of the
Constitution, which grants to the Executive Department the
authority to recommend the budget necessary for its operation.
Evidently, this grant of power includes the authority to evaluate
each and every government agency, including the determination
of the most economical and efficient staffing pattern, under the
Executive Department.

In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon.

Ronaldo D. Zamora, in his capacity as the Executive Secretary,
et al.,[13] this Court has had occasion to also delve on the
Presidents power to reorganize the Office of the President under
Section 31(2) and (3) of Executive Order No. 292 and the power
to reorganize the Office of the President Proper. The Court has
there observed:
x x x. Under Section 31(1) of EO 292, the President can
reorganize the Office of the President Proper by abolishing,
consolidating or merging units, or by transferring functions from
one unit to another. In contrast, under Section 31(2) and (3) of
EO 292, the Presidents power to reorganize offices outside the
Office of the President Proper but still within the Office of the
President is limited to merely transferring functions or agencies
from the Office of the President to Departments or Agencies, and
vice versa.
The provisions of Section 31, Book III, Chapter 10, of Executive
Order No. 292 (Administrative Code of 1987), above-referred to,
reads thusly:
SEC. 31. Continuing Authority of the President to Reorganize his
Office. The President, subject to the policy in the Executive Office
and in order to achieve simplicity, economy and efficiency, shall
have continuing authority to reorganize the administrative
structure of the Office of the President. For this purpose, he may
take any of the following actions:
(1) Restructure the internal organization of the Office of the
President Proper, including the immediate Offices, the
Presidential Special Assistants/Advisers System and the
Common Staff Support System, by abolishing, consolidating or
merging units thereof or transferring functions from one unit to
another;
(2) Transfer any function under the Office of the President to any
other Department or Agency as well as transfer functions to the

Office of the President from other Departments and Agencies;

and
(3) Transfer any agency under the Office of the President to any
other department or agency as well as transfer agencies to the
Office of the President from other departments and agencies.
The first sentence of the law is an express grant to the President
of a continuing authority to reorganize the administrative structure
of the Office of the President. The succeeding numbered
paragraphs are not in the nature of provisos that unduly limit the
aim and scope of the grant to the President of the power to
reorganize but are to be viewed in consonance therewith. Section
31(1) of Executive Order No. 292 specifically refers to the
Presidents power to restructure the internal organization of the
Office of the President Proper, by abolishing, consolidating or
merging units hereof or transferring functions from one unit to
another, while Section 31(2) and (3) concern executive offices
outside the Office of the President Proper allowing the President
to transfer any function under the Office of the President to any
other Department or Agency and vice-versa, and the transfer of
any agency under the Office of the President to any other
department or agency and vice-versa.[14]
In the present instance, involving neither an abolition nor transfer
of offices, the assailed action is a mere reorganization under the
general provisions of the law consisting mainly of streamlining the
NTA in the interest of simplicity, economy and efficiency. It is an
act well within the authority of President motivated and carried
out, according to the findings of the appellate court, in good faith,
a factual assessment that this Court could only but accept.[15]
In passing, relative to petitioners Motion for an En Banc
Resolution of the Case, it may be well to remind counsel, that the
Court En Banc is not an appellate tribunal to which appeals from
a Division of the Court may be taken. A Division of the Court is
the Supreme Court as fully and veritably as the Court En Banc
itself and a decision of its Division is as authoritative and final as
a decision of the Court En Banc. Referrals of cases from a

Division to the Court En Banc do not take place as just a matter

of routine but only on such specified grounds as the Court in its
discretion may allow.[16]
WHEREFORE, the Motion to Admit Petition for En Banc
resolution and the Petition for an En Banc Resolution are
DENIED for lack of merit. Let entry of judgment be made in due
course. No costs.
SO ORDERED.

5. Domingo v. Zamora
[G.R. No. 142283. February 6, 2003]
ROSA LIGAYA C. DOMINGO, ROMEO M. FERNANDEZ,
VICTORIA S. ESTRADA, JULIETA C. FAJARDO, ADELAIDA B.
GAWIRAN, MARCIANO M. SERVO, VICTORIA S. DAOANG,
FELICIANO N. TOLEDO III, JAYNELYN D. FLORES, MA. LIZA
B. LLOREN, ROMELIA A. CONTAPAY, MARIVIC B. TOLITOL,
PAZ LEVITA G. VILLANUEVA, EDITHA C. HERNANDEZ, JOSE
HERNANDEZ, JR., VERONICA C. BELLES, AMELITA S. BUCE,
MERCELITA C. MARANAN, CRISTITUTO C. LLOREN,
HERNANDO M. EVANGELISTA, and CARLOS BACAY, JR.,
petitioners, vs. HON. RONALDO D. ZAMORA, in his capacity as
the Executive Secretary, HON. ANDREW B. GONZALES, in his
capacity as the Secretary of Education, and HON. CARLOS D.
TUASON, in his capacity as the Chairman of the Philippine Sports
Commission, respondents.
DECISION
CARPIO, J.:
The Case
This is a petition for certiorari and prohibition[1] with prayer for
temporary restraining order seeking to nullify Executive Order No.
81 and Memoranda Nos. 01592 and 01594.[2] The assailed
executive order transferred the sports development programs
and activities of the Department of Education, Culture and Sports
(DECS for brevity) to the Philippine Sports Commission (PSC for
brevity). The questioned memoranda (DECS Memoranda for
brevity), on the other hand, reassigned all Bureau of Physical
Education and School Sports (BPESS for brevity) personnel
named in the DECS Memoranda to various offices within the
DECS.
The Facts
On March 5, 1999, former President Joseph E. Estrada issued
Executive Order No. 81[3] (EO 81 for brevity) entitled Transferring

the Sports Programs and Activities of the Department of

Education, Culture and Sports to the Philippine Sports
Commission and Defining the Role of DECS in School-Based
Sports.
EO 81 provided thus:
Section 1. Transferring the Sports Program and Activities to the
PSC. All the functions, programs and activities of DECS related
to sports development as provided for in Sec. 16 of EO 117 (s.
1987) are hereby transferred to PSC.
Section 2. Defining the Role of DECS in School-Based Sports.
The DECS shall have jurisdiction and function over the
enhancement of Physical Education (P.E.) curriculum and its
application in whatever form inside schools.
Section 3. The Role of PSC. As the primary agency tasked to
formulate policies and oversee the national sports development
program, the management and implementation of all schoolbased sports competitions among schools at the district,
provincial, regional, national and international levels, in
coordination with concerned public and private entities shall be
transferred to the PSC.
Pursuant to EO 81, former DECS Secretary Andrew B. Gonzales
(Secretary Gonzales for brevity) issued Memorandum No. 01592
on January 10, 2000. Memorandum No. 01592 temporarily
reassigned, in the exigency of the service, all remaining BPESS
Staff to other divisions or bureaus of the DECS effective March
15, 2000.
On January 21, 2000, Secretary Gonzales issued Memorandum
No. 01594 reassigning the BPESS staff named in the
Memorandum to various offices within the DECS effective March
15, 2000. Petitioners were among the BPESS personnel affected
by Memorandum No. 01594. Dissatisfied with their reassignment,
petitioners filed the instant petition.

In their Petition, petitioners argue that EO 81 is void and

unconstitutional for being an undue legislation by President
Estrada. Petitioners maintain that the Presidents issuance of EO
81 violated the principle of separation of powers. Petitioners also
challenge the DECS Memoranda for violating their right to
security of tenure.

We dismiss this petition for being moot and academic.

Petitioners seek to nullify EO 81 and the DECS Memoranda.

Petitioners pray that this Court prohibit the PSC from performing
functions related to school sports development. Petitioners
further pray that, upon filing of the petition, this Court issue a
temporary restraining order against respondents to desist from
implementing EO 81.

As manifested by both petitioners[4] and respondents,[5] the

subsequent enactment of RA 9155 has rendered the issues in the
present case moot and academic. Since RA 9155 abolished the
BPESS and transferred the DECS functions relating to sports
competition to the PSC, petitioners now admit that it is no longer
plausible to raise any ultra vires assumption by the PSC of the
functions of the BPESS.[6] Moreover, since RA 9155 provides
that BPESS personnel not transferred to the PSC shall be
retained by the DECS, petitioners now accept that the law
explicitly protects and preserves[7] their right to security of tenure.

During the pendency of the case, Republic Act No. 9155 (RA
9155 for brevity), otherwise known as the Governance of Basic
Education Act of 2001, was enacted on August 11, 2001. RA
9155 expressly abolished the BPESS and transferred the
functions, programs and activities of the DECS relating to sports
competition to the PSC. The pertinent provision thereof reads:

Although the issue is already academic, its significance

constrains the Court to point out that Executive Order No. 292
(EO 292 for brevity), otherwise known as the Administrative Code
of 1987, expressly grants the President continuing authority to
reorganize the Office of the President. Section 31 of EO 292
provides:

SEC. 9. Abolition of BPESS. All functions, programs and activities

of the Department of Education related to sports competition shall
be transferred to the Philippine Sports Commission (PSC). The
Program for school sports and physical fitness shall remain part
of the basic education curriculum.

SEC. 31. Continuing Authority of the President to Reorganize his

Office. The President, subject to the policy in the Executive Office
and in order to achieve simplicity, economy and efficiency, shall
have continuing authority to reorganize the administrative
structure of the Office of the President. For this purpose, he may
take any of the following actions:

The Bureau of Physical Education and School Sports (BPESS) is

hereby abolished. The personnel of the BPESS, presently
detailed with the PSC, are hereby transferred to the PSC without
loss of rank, including the plantilla positions they occupy. All other
BPESS personnel shall be retained by the Department.
The Issue
The issue to resolve is whether EO 81 and the DECS Memoranda
are valid.
The Courts Ruling

(1) Restructure the internal organization of the Office of the

President Proper, including the immediate Offices, the
Presidential Special Assistants/Advisers System and the
Common Support System, by abolishing, consolidating or
merging units thereof or transferring functions from one unit to
another;
(2) Transfer any function under the Office of the President to any
other Department or Agency as well as transfer functions to the
Office of the President from other Departments and Agencies;
and

(3) Transfer any agency under the Office of the President to any
other department or agency as well as transfer agencies to the
Office of the President from other Departments or Agencies.
(Emphasis supplied.)
Since EO 81 is based on the Presidents continuing authority
under Section 31 (2) and (3) of EO 292,[8] EO 81 is a valid
exercise of the Presidents delegated power to reorganize the
Office of the President. The law grants the President this power
in recognition of the recurring need of every President to
reorganize his office to achieve simplicity, economy and
efficiency. The Office of the President is the nerve center of the
Executive Branch. To remain effective and efficient, the Office of
the President must be capable of being shaped and reshaped by
the President in the manner he deems fit to carry out his directives
and policies. After all, the Office of the President is the command
post of the President. This is the rationale behind the Presidents
continuing authority to reorganize the administrative structure of
the Office of the President.
Petitioners contention that the DECS is not part of the Office of
the President is immaterial. Under EO 292, the DECS is
indisputably a Department of the Executive Branch. Even if the
DECS is not part of the Office of the President, Section 31 (2) and
(3) of EO 292 clearly authorizes the President to transfer any
function or agency of the DECS to the Office of the President.
Under its charter, the PSC is attached to the Office of the
President.[9] Therefore, the President has the authority to
transfer the functions, programs and activities of DECS related to
sports development[10] to the PSC, making EO 81 a valid
presidential issuance.
However, the Presidents power to reorganize the Office of the
President under Section 31 (2) and (3) of EO 292 should be
distinguished from his power to reorganize the Office of the
President Proper. Under Section 31 (1) of EO 292, the President
can reorganize the Office of the President Proper by abolishing,
consolidating or merging units, or by transferring functions from

one unit to another. In contrast, under Section 31 (2) and (3) of

EO 292, the Presidents power to reorganize offices outside the
Office of the President Proper but still within the Office of the
President is limited to merely transferring functions or agencies
from the Office of the President to Departments or Agencies, and
vice versa.
This distinction is crucial as it affects the security of tenure of
employees. The abolition of an office in good faith necessarily
results in the employees cessation in office, but in such event
there is no dismissal or separation because the office itself
ceases to exist.[11] On the other hand, the transfer of functions
or agencies does not result in the employees cessation in office
because his office continues to exist although in another
department, agency or office. In the instant case, the BPESS
employees who were not transferred to PSC were at first
temporarily, then later permanently reassigned to other offices of
the DECS, ensuring their continued employment. At any rate, RA
9155 now mandates that these employees shall be retained by
the Department.
WHEREFORE, the instant
pronouncement as to costs.
SO ORDERED.

petition

is

DISMISSED.

No