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

192935
Petitioner,

- versus -

THE PHILIPPINE TRUTH COMMISSION OF 2010,

Respondent.
x-----------------------x
REP. EDCEL C. LAGMAN,
REP. RODOLFO B. ALBANO, JR., REP. SIMEON A. G.R. No. 193036
DATUMANONG, and REP. ORLANDO B. FUA, SR.,
Petitioners, Present:

CORONA, C.J.,
CARPIO,
- versus - CARPIO MORALES,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO,
BRION,
PERALTA,
BERSAMIN,
DEL CASTILLO,
ABAD,
EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR. VILLARAMA, JR.,
and DEPARTMENT OF BUDGET AND PEREZ,
MANAGEMENT SECRETARY FLORENCIO B. MENDOZA, and
ABAD, SERENO, JJ.
Respondents.
Promulgated:

December 7, 2010

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

DECISION

MENDOZA, J.:

When the judiciary mediates to allocate constitutional boundaries, it does not assert any superiority over the other departments; it does not in reality nullify or invalidate
an act of the legislature, but only asserts the solemn and sacred obligation assigned to it by the Constitution to determine conflicting claims of authority under the Constitution and
to establish for the parties in an actual controversy the rights which that instrument secures and guarantees to them.

--- Justice Jose P. Laurel[1]

The role of the Constitution cannot be overlooked. It is through the Constitution that the fundamental powers of government are established, limited and defined, and by which these powers are

distributed among the several departments.[2] The Constitution is the basic and paramount law to which all other laws must conform and to which all persons, including the highest officials of the land,
must defer.[3] Constitutional doctrines must remain steadfast no matter what may be the tides of time. It cannot be simply made to sway and accommodate the call of situations and much more tailor

itself to the whims and caprices of government and the people who run it. [4]

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

Philippine Truth Commission of 2010.

The first case is G.R. No. 192935, a special civil action for prohibition instituted by petitioner Louis Biraogo (Biraogo) in his capacity as a citizen and taxpayer. Biraogo assails Executive

Order No. 1 for being violative of the legislative power of Congress under Section 1, Article VI of the Constitution [6] as it usurps the constitutional authority of the legislature to create a public office

and to appropriate funds therefor.[7]

The second case, G.R. No. 193036, is a special civil action for certiorari and prohibition filed by petitioners Edcel C. Lagman, Rodolfo B. Albano Jr., Simeon A. Datumanong, and Orlando B. Fua,

Sr. (petitioners-legislators) as incumbent members of the House of Representatives.

The genesis of the foregoing cases can be traced to the events prior to the historic May 2010 elections, when then Senator Benigno Simeon Aquino III declared his staunch condemnation of graft and

corruption with his slogan, Kung walang corrupt, walang mahirap. The Filipino people, convinced of his sincerity and of his ability to carry out this noble objective, catapulted the good senator to the

presidency.

To transform his campaign slogan into reality, President Aquino found a need for a special body to investigate reported cases of graft and corruption allegedly committed during the previous

administration.

Thus, at the dawn of his administration, the President on July 30, 2010, signed Executive Order No. 1 establishing the Philippine Truth Commission of 2010 (Truth Commission). Pertinent

provisions of said executive order read:

EXECUTIVE ORDER NO. 1

CREATING THE PHILIPPINE TRUTH COMMISSION OF 2010

WHEREAS, Article XI, Section 1 of the 1987 Constitution of the Philippines solemnly enshrines the principle that a public office is a public trust and mandates that public officers
and employees, who are servants of the people, must at all times be accountable to the latter, serve them with utmost responsibility, integrity, loyalty and efficiency, act with
patriotism and justice, and lead modest lives;

WHEREAS, corruption is among the most despicable acts of defiance of this principle and notorious violation of this mandate;
WHEREAS, corruption is an evil and scourge which seriously affects the political, economic, and social life of a nation; in a very special way it inflicts untold misfortune and
misery on the poor, the marginalized and underprivileged sector of society;

WHEREAS, corruption in the Philippines has reached very alarming levels, and undermined the peoples trust and confidence in the Government and its institutions;

WHEREAS, there is an urgent call for the determination of the truth regarding certain reports of large scale graft and corruption in the government and to put a closure to them by
the filing of the appropriate cases against those involved, if warranted, and to deter others from committing the evil, restore the peoples faith and confidence in the Government and
in their public servants;

WHEREAS, the Presidents battlecry during his campaign for the Presidency in the last elections kung walang corrupt, walang mahirap expresses a solemn pledge that if elected,
he would end corruption and the evil it breeds;

WHEREAS, there is a need for a separate body dedicated solely to investigating and finding out the truth concerning the reported cases of graft and corruption during the previous
administration, and which will recommend the prosecution of the offenders and secure justice for all;
WHEREAS, Book III, Chapter 10, Section 31 of Executive Order No. 292, otherwise known as the Revised Administrative Code of the Philippines, gives the President the
continuing authority to reorganize the Office of the President.

NOW, THEREFORE, I, BENIGNO SIMEON AQUINO III, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order:

SECTION 1. Creation of a Commission. There is hereby created the PHILIPPINE TRUTH COMMISSION, hereinafter referred to as the COMMISSION, which shall primarily
seek and find the truth on, and toward this end, investigate reports of graft and corruption of such scale and magnitude that shock and offend the moral and ethical sensibilities of
the people, committed by public officers and employees, their co-principals, accomplices and accessories from the private sector, if any, during the previous administration; and
thereafter recommend the appropriate action or measure to be taken thereon to ensure that the full measure of justice shall be served without fear or favor.
The Commission shall be composed of a Chairman and four (4) members who will act as an independent collegial body.

SECTION 2. Powers and Functions. The Commission, which shall have all the powers of an investigative body under Section 37, Chapter 9, Book I of the Administrative Code of
1987, is primarily tasked to conduct a thorough fact-finding investigation of reported cases of graft and corruption referred to in Section 1, involving third level public officers and
higher, their co-principals, accomplices and accessories from the private sector, if any, during the previous administration and thereafter submit its finding and recommendations to
the President, Congress and the Ombudsman.
In particular, it shall:

a) Identify and determine the reported cases of such graft and corruption which it will investigate;

b) Collect, receive, review and evaluate evidence related to or regarding the cases of large scale corruption which it has chosen to investigate, and to this end require any agency,
official or employee of the Executive Branch, including government-owned or controlled corporations, to produce documents, books, records and other papers;

c) Upon proper request or representation, obtain information and documents from the Senate and the House of Representatives records of investigations conducted by
committees thereof relating to matters or subjects being investigated by the Commission;

d) Upon proper request and representation, obtain information from the courts, including the Sandiganbayan and the Office of the Court Administrator, information or
documents in respect to corruption cases filed with the Sandiganbayan or the regular courts, as the case may be;

e) Invite or subpoena witnesses and take their testimonies and for that purpose, administer oaths or affirmations as the case may be;

f) Recommend, in cases where there is a need to utilize any person as a state witness to ensure that the ends of justice be fully served, that such person who qualifies as a state
witness under the Revised Rules of Court of the Philippines be admitted for that purpose;
g) Turn over from time to time, for expeditious prosecution, to the appropriate prosecutorial authorities, by means of a special or interim report and recommendation, all
evidence on corruption of public officers and employees and their private sector co-principals, accomplices or accessories, if any, when in the course of its investigation the
Commission finds that there is reasonable ground to believe that they are liable for graft and corruption under pertinent applicable laws;

h) Call upon any government investigative or prosecutorial agency such as the Department of Justice or any of the agencies under it, and the Presidential Anti-Graft
Commission, for such assistance and cooperation as it may require in the discharge of its functions and duties;

i) Engage or contract the services of resource persons, professionals and other personnel determined by it as necessary to carry out its mandate;

j) Promulgate its rules and regulations or rules of procedure it deems necessary to effectively and efficiently carry out the objectives of this Executive Order and to ensure the
orderly conduct of its investigations, proceedings and hearings, including the presentation of evidence;

k) Exercise such other acts incident to or are appropriate and necessary in connection with the objectives and purposes of this Order.
SECTION 3. Staffing Requirements. x x x.

SECTION 4. Detail of Employees. x x x.

SECTION 5. Engagement of Experts. x x x

SECTION 6. Conduct of Proceedings. x x x.

SECTION 7. Right to Counsel of Witnesses/Resource Persons. x x x.
SECTION 8. Protection of Witnesses/Resource Persons. x x x.
SECTION 9. Refusal to Obey Subpoena, Take Oath or Give Testimony. Any government official or personnel who, without lawful excuse, fails to appear upon subpoena issued by
the Commission or who, appearing before the Commission refuses to take oath or affirmation, give testimony or produce documents for inspection, when required, shall be subject
to administrative disciplinary action. Any private person who does the same may be dealt with in accordance with law.
SECTION 10. Duty to Extend Assistance to the Commission. x x x.
SECTION 11. Budget for the Commission. The Office of the President shall provide the necessary funds for the Commission to ensure that it can exercise its powers, execute its
functions, and perform its duties and responsibilities as effectively, efficiently, and expeditiously as possible.
SECTION 12. Office. x x x.

SECTION 13. Furniture/Equipment. x x x.

SECTION 14. Term of the Commission. The Commission shall accomplish its mission on or before December 31, 2012.

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

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

SECTION 17. Special Provision Concerning Mandate. If and when in the judgment of the President there is a need to expand the mandate of the Commission as defined in Section
1 hereof to include the investigation of cases and instances of graft and corruption during the prior administrations, such mandate may be so extended accordingly by way of a
supplemental Executive Order.

SECTION 18. Separability Clause. If any provision of this Order is declared unconstitutional, the same shall not affect the validity and effectivity of the other provisions hereof.

SECTION 19. Effectivity. This Executive Order shall take effect immediately.

DONE in the City of Manila, Philippines, this 30th day of July 2010.
 (SGD.) BENIGNO S. AQUINO III

By the President:

(SGD.) PAQUITO N. OCHOA, JR.

Executive Secretary

Nature of the Truth Commission

As can be gleaned from the above-quoted provisions, the Philippine Truth Commission (PTC) is a mere ad hoc body formed under the Office of the President with the primary task to

investigate reports of graft and corruption committed by third-level public officers and employees, their co-principals, accomplices and accessories during the previous administration, and thereafter to

submit its finding and recommendations to the President, Congress and the Ombudsman. Though it has been described as an independent collegial body, it is essentially an entity within the Office of

the President Proper and subject to his control. Doubtless, it constitutes a public office, as an ad hoc body is one. [8]

To accomplish its task, the PTC shall have all the powers of an investigative body under Section 37, Chapter 9, Book I of the Administrative Code of 1987. It is not, however, a quasi-judicial

body as it cannot adjudicate, arbitrate, resolve, settle, or render awards in disputes between contending parties. All it can do is gather, collect and assess evidence of graft and corruption and make

recommendations. It may have subpoena powers but it has no power to cite people in contempt, much less order their arrest. Although it is a fact-finding body, it cannot determine from such facts if

probable cause exists as to warrant the filing of an information in our courts of law. Needless to state, it cannot impose criminal, civil or administrative penalties or sanctions.

The PTC is different from the truth commissions in other countries which have been created as official, transitory and non-judicial fact-finding bodies to establish the facts and context of

serious violations of human rights or of international humanitarian law in a countrys past. [9] They are usually established by states emerging from periods of internal unrest, civil strife or

authoritarianism to serve as mechanisms for transitional justice.

Truth commissions have been described as bodies that share the following characteristics: (1) they examine only past events; (2) they investigate patterns of abuse committed over a period

of time, as opposed to a particular event; (3) they are temporary bodies that finish their work with the submission of a report containing conclusions and recommendations; and (4) they are officially

sanctioned, authorized or empowered by the State. [10] Commissions members are usually empowered to conduct research, support victims, and propose policy recommendations to prevent recurrence

of crimes. Through their investigations, the commissions may aim to discover and learn more about past abuses, or formally acknowledge them. They may aim to prepare the way for prosecutions and

recommend institutional reforms.[11]

Thus, their main goals range from retribution to reconciliation. The Nuremburg and Tokyo war crime tribunals are examples of a retributory or vindicatory body set up to try and punish

those responsible for crimes against humanity. A form of a reconciliatory tribunal is the Truth and Reconciliation Commission of South Africa, the principal function of which was to heal the wounds

of past violence and to prevent future conflict by providing a cathartic experience for victims.
 The PTC is a far cry from South Africas model. The latter placed more emphasis on reconciliation than on judicial retribution, while the marching order of the PTC is the identification and

punishment of perpetrators. As one writer[12] puts it:

The order ruled out reconciliation. It translated the Draconian code spelled out by Aquino in his inaugural speech: To those who talk about reconciliation, if they mean
that they would like us to simply forget about the wrongs that they have committed in the past, we have this to say: There can be no reconciliation without justice. When we allow
crimes to go unpunished, we give consent to their occurring over and over again.

The Thrusts of the Petitions

Barely a month after the issuance of Executive Order No. 1, the petitioners asked the Court to declare it unconstitutional and to enjoin the PTC from performing its functions. A perusal of

the arguments of the petitioners in both cases shows that they are essentially the same. The petitioners-legislators summarized them in the following manner:

(a) E.O. No. 1 violates the separation of powers as it arrogates the power of the Congress to create a public office and appropriate funds for its operation.

(b) The provision of Book III, Chapter 10, Section 31 of the Administrative Code of 1987 cannot legitimize E.O. No. 1 because the delegated authority of the President to
structurally reorganize the Office of the President to achieve economy, simplicity and efficiency does not include the power to create an entirely new public office which was
hitherto inexistent like the Truth Commission.

(c) E.O. No. 1 illegally amended the Constitution and pertinent statutes when it vested the Truth Commission with quasi-judicial powers duplicating, if not superseding,
those of the Office of the Ombudsman created under the 1987 Constitution and the Department of Justice created under the Administrative Code of 1987.

(d) E.O. No. 1 violates the equal protection clause as it selectively targets for investigation and prosecution officials and personnel of the previous administration as if
corruption is their peculiar species even as it excludes those of the other administrations, past and present, who may be indictable.

(e) The creation of the Philippine Truth Commission of 2010 violates the consistent and general international practice of four decades wherein States constitute truth
commissions to exclusively investigate human rights violations, which customary practice forms part of the generally accepted principles of international law which the Philippines
is mandated to adhere to pursuant to the Declaration of Principles enshrined in the Constitution.

(f) The creation of the Truth Commission is an exercise in futility, an adventure in partisan hostility, a launching pad for trial/conviction by publicity and a mere populist
propaganda to mistakenly impress the people that widespread poverty will altogether vanish if corruption is eliminated without even addressing the other major causes of poverty.

(g) The mere fact that previous commissions were not constitutionally challenged is of no moment because neither laches nor estoppel can bar an eventual question on
the constitutionality and validity of an executive issuance or even a statute. [13]

In their Consolidated Comment,[14] the respondents, through the Office of the Solicitor General (OSG), essentially questioned the legal standing of petitioners and defended the assailed

executive order with the following arguments:

1] E.O. No. 1 does not arrogate the powers of Congress to create a public office because the Presidents executive power and power of control necessarily include the
inherent power to conduct investigations to ensure that laws are faithfully executed and that, in any event, the Constitution, Revised Administrative Code of 1987 (E.O. No.
292), [15] Presidential Decree (P.D.) No. 1416 [16] (as amended by P.D. No. 1772), R.A. No. 9970, [17] and settled jurisprudence that authorize the President to create or form such
bodies.
 2] E.O. No. 1 does not usurp the power of Congress to appropriate funds because there is no appropriation but a mere allocation of funds already appropriated by
Congress.

3] The Truth Commission does not duplicate or supersede the functions of the Office of the Ombudsman (Ombudsman) and the Department of Justice (DOJ),because it is
a fact-finding body and not a quasi-judicial body and its functions do not duplicate, supplant or erode the latters jurisdiction.

4] The Truth Commission does not violate the equal protection clause because it was validly created for laudable purposes.

The OSG then points to the continued existence and validity of other executive orders and presidential issuances creating similar bodies to justify the creation of the PTC such as Presidential

Complaint and Action Commission (PCAC) by President Ramon B. Magsaysay, Presidential Committee on Administrative Performance Efficiency (PCAPE)by President Carlos P. Garcia and

Presidential Agency on Reform and Government Operations (PARGO) by President Ferdinand E. Marcos.[18]

From the petitions, pleadings, transcripts, and memoranda, the following are the principal issues to be resolved:

1. Whether or not the petitioners have the legal standing to file their respective petitions and question Executive Order No. 1;

2. Whether or not Executive Order No. 1 violates the principle of separation of powers by usurping the powers of Congress to create and to appropriate

funds for public offices, agencies and commissions;

3. Whether or not Executive Order No. 1 supplants the powers of the Ombudsman and the DOJ;

4. Whether or not Executive Order No. 1 violates the equal protection clause; and

5. Whether or not petitioners are entitled to injunctive relief.

Essential requisites for judicial review

Before proceeding to resolve the issue of the constitutionality of Executive Order No. 1, the Court needs to ascertain whether the requisites for a valid exercise of its power of judicial review are

present.

Like almost all powers conferred by the Constitution, the power of judicial review is subject to limitations, to wit: (1) there must be an actual case or controversy calling for the exercise of judicial

power; (2) the person challenging the act must have the standing to question the validity of the subject act or issuance; otherwise stated, he must have a personal and substantial interest in the case

such that he has sustained, or will sustain, direct injury as a result of its enforcement; (3) the question of constitutionality must be raised at the earliest opportunity; and (4) the issue of constitutionality

must be the very lis mota of the case.[19]

Among all these limitations, only the legal standing of the petitioners has been put at issue.

Legal Standing of the Petitioners

The OSG attacks the legal personality of the petitioners-legislators to file their petition for failure to demonstrate their personal stake in the outcome of the case. It argues that the petitioners

have not shown that they have sustained or are in danger of sustaining any personal injury attributable to the creation of the PTC. Not claiming to be the subject of the commissions investigations,

petitioners will not sustain injury in its creation or as a result of its proceedings. [20]

The Court disagrees with the OSG in questioning the legal standing of the petitioners-legislators to assail Executive Order No. 1. Evidently, their petition primarily invokes usurpation of the

power of the Congress as a body to which they belong as members. This certainly justifies their resolve to take the cudgels for Congress as an institution and present the complaints on the usurpation

of their power and rights as members of the legislature before the Court. As held in Philippine Constitution Association v. Enriquez,[21]

To the extent the powers of Congress are impaired, so is the power of each member thereof, since his office confers a right to participate in the exercise of the powers of
that institution.
An act of the Executive which injures the institution of Congress causes a derivative but nonetheless substantial injury, which can be questioned by a member of
Congress. In such a case, any member of Congress can have a resort to the courts.

Indeed, legislators have a legal standing to see to it that the prerogative, powers and privileges vested by the Constitution in their office remain inviolate. Thus, they are allowed to question

the validity of any official action which, to their mind, infringes on their prerogatives as legislators. [22]

With regard to Biraogo, the OSG argues that, as a taxpayer, he has no standing to question the creation of the PTC and the budget for its operations. [23] It emphasizes that the funds to be used

for the creation and operation of the commission are to be taken from those funds already appropriated by Congress. Thus, the allocation and disbursement of funds for the commission will not entail

congressional action but will simply be an exercise of the Presidents power over contingent funds.

As correctly pointed out by the OSG, Biraogo has not shown that he sustained, or is in danger of sustaining, any personal and direct injury attributable to the implementation of Executive

Order No. 1. Nowhere in his petition is an assertion of a clear right that may justify his clamor for the Court to exercise judicial power and to wield the axe over presidential issuances in defense of the

Constitution. The case of David v. Arroyo[24] explained the deep-seated rules on locus standi. Thus:

Locus standi is defined as a right of appearance in a court of justice on a given question. In private suits, standing is governed by the real-parties-in interest rule as
contained in Section 2, Rule 3 of the 1997 Rules of Civil Procedure, as amended. It provides that every action must be prosecuted or defended in the name of the real party in
interest. Accordingly, the real-party-in interest is the party who stands to be benefited or injured by the judgment in the suit or the party entitled to the avails of the suit.Succinctly
put, the plaintiffs standing is based on his own right to the relief sought.
 The difficulty of determining locus standi arises in public suits. Here, the plaintiff who asserts a public right in assailing an allegedly illegal official action, does so as a
representative of the general public. He may be a person who is affected no differently from any other person. He could be suing as a stranger, or in the category of a citizen, or
taxpayer. In either case, he has to adequately show that he is entitled to seek judicial protection. In other words, he has to make out a sufficient interest in the vindication of the
public order and the securing of relief as a citizen or taxpayer.

Case law in most jurisdictions now allows both citizen and taxpayer standing in public actions. The distinction was first laid down in Beauchamp v. Silk, where it was
held that the plaintiff in a taxpayers suit is in a different category from the plaintiff in a citizens suit. In the former, the plaintiff is affected by the expenditure of public funds, while
in the latter, he is but the mere instrument of the public concern. As held by the New York Supreme Court in People ex rel Case v. Collins: In matter of mere public right,
howeverthe people are the real partiesIt is at least the right, if not the duty, of every citizen to interfere and see that a public offence be properly pursued and punished, and that a
public grievance be remedied. With respect to taxpayers suits, Terr v. Jordan held that the right of a citizen and a taxpayer to maintain an action in courts to restrain the unlawful
use of public funds to his injury cannot be denied.

However, to prevent just about any person from seeking judicial interference in any official policy or act with which he disagreed with, and thus hinders the activities of
governmental agencies engaged in public service, the United State Supreme Court laid down the more stringent direct injury test in Ex Parte Levitt, later reaffirmed in Tileston v.
Ullman. The same Court ruled that for a private individual to invoke the judicial power to determine the validity of an executive or legislative action, he must show that he has
sustained a direct injury as a result of that action, and it is not sufficient that he has a general interest common to all members of the public.

This Court adopted the direct injury test in our jurisdiction. In People v. Vera, it held that the person who impugns the validity of a statute must have a personal and
substantial interest in the case such that he has sustained, or will sustain direct injury as a result. The Vera doctrine was upheld in a litany of cases, such as, Custodio v.
President of the Senate, Manila Race Horse Trainers Association v. De la Fuente, Pascual v. Secretary of Public Works and Anti-Chinese League of the Philippines v.
Felix. [Emphases included. Citations omitted]

Notwithstanding, the Court leans on the doctrine that the rule on standing is a matter of procedure, hence, can be relaxed for nontraditional plaintiffs like ordinary citizens, taxpayers, and

legislators when the public interest so requires, such as when the matter is of transcendental importance, of overreaching significance to society, or of paramount public interest. [25]

Thus, in Coconut Oil Refiners Association, Inc. v. Torres,[26] the Court held that in cases of paramount importance where serious constitutional questions are involved, the standing

requirements may be relaxed and a suit may be allowed to prosper even where there is no direct injury to the party claiming the right of judicial review. In the first Emergency Powers Cases,
[27]
ordinary citizens and taxpayers were allowed to question the constitutionality of several executive orders although they had only an indirect and general interest shared in common with the public.

The OSG claims that the determinants of transcendental importance [28] laid down in CREBA v. ERC and Meralco [29] are non-existent in this case. The Court, however, finds reason in

Biraogos assertion that the petition covers matters of transcendental importance to justify the exercise of jurisdiction by the Court. There are constitutional issues in the petition which deserve the

attention of this Court in view of their seriousness, novelty and weight as precedents. Where the issues are of transcendental and paramount importance not only to the public but also to the Bench and

the Bar, they should be resolved for the guidance of all. [30] Undoubtedly, the Filipino people are more than interested to know the status of the Presidents first effort to bring about a promised change to

the country. The Court takes cognizance of the petition not due to overwhelming political undertones that clothe the issue in the eyes of the public, but because the Court stands firm in its oath to

perform its constitutional duty to settle legal controversies with overreaching significance to society.

Power of the President to Create the Truth Commission

 In his memorandum in G.R. No. 192935, Biraogo asserts that the Truth Commission is a public office and not merely an adjunct body of the Office of the President. [31]Thus, in order that the

President may create a public office he must be empowered by the Constitution, a statute or an authorization vested in him by law. According to petitioner, such power cannot be presumed [32] since

there is no provision in the Constitution or any specific law that authorizes the President to create a truth commission. [33] He adds that Section 31 of the Administrative Code of 1987, granting the

President the continuing authority to reorganize his office, cannot serve as basis for the creation of a truth commission considering the aforesaid provision merely uses verbs such as reorganize,

transfer, consolidate, merge, and abolish. [34] Insofar as it vests in the President the plenary power to reorganize the Office of the President to the extent of creating a public office, Section 31 is

inconsistent with the principle of separation of powers enshrined in the Constitution and must be deemed repealed upon the effectivity thereof. [35]

Similarly, in G.R. No. 193036, petitioners-legislators argue that the creation of a public office lies within the province of Congress and not with the executive branch of government. They

maintain that the delegated authority of the President to reorganize under Section 31 of the Revised Administrative Code: 1) does not permit the President to create a public office, much less a truth

commission; 2) is limited to the reorganization of the administrative structure of the Office of the President; 3) is limited to the restructuring of the internal organs of the Office of the President Proper,

transfer of functions and transfer of agencies; and 4) only to achieve simplicity, economy and efficiency. [36] Such continuing authority of the President to reorganize his office is limited, and by issuing

Executive Order No. 1, the President overstepped the limits of this delegated authority.

The OSG counters that there is nothing exclusively legislative about the creation by the President of a fact-finding body such as a truth commission. Pointing to numerous offices created by

past presidents, it argues that the authority of the President to create public offices within the Office of the President Proper has long been recognized. [37]According to the OSG, the Executive, just like

the other two branches of government, possesses the inherent authority to create fact-finding committees to assist it in the performance of its constitutionally mandated functions and in the exercise of

its administrative functions.[38] This power, as the OSG explains it, is but an adjunct of the plenary powers wielded by the President under Section 1 and his power of control under Section 17, both of

Article VII of the Constitution.[39]

It contends that the President is necessarily vested with the power to conduct fact-finding investigations, pursuant to his duty to ensure that all laws are enforced by public officials and

employees of his department and in the exercise of his authority to assume directly the functions of the executive department, bureau and office, or interfere with the discretion of his officials. [40] The

power of the President to investigate is not limited to the exercise of his power of control over his subordinates in the executive branch, but extends further in the exercise of his other powers, such as

his power to discipline subordinates,[41] his power for rule making, adjudication and licensing purposes [42] and in order to be informed on matters which he is entitled to know.[43]

The OSG also cites the recent case of Banda v. Ermita,[44] where it was held that the President has the power to reorganize the offices and agencies in the executive department in line with his

constitutionally granted power of control and by virtue of a valid delegation of the legislative power to reorganize executive offices under existing statutes.

Thus, the OSG concludes that the power of control necessarily includes the power to create offices. For the OSG, the President may create the PTC in order to, among others, put a closure to

the reported large scale graft and corruption in the government. [45]
 The question, therefore, before the Court is this: Does the creation of the PTC fall within the ambit of the power to reorganize as expressed in Section 31 of the Revised Administrative

Code? Section 31 contemplates reorganization as limited by the following functional and structural lines: (1) restructuring the internal organization of the Office of the President Proper by abolishing,

consolidating or merging units thereof or transferring functions from one unit to another; (2) transferring any function under the Office of the President to any other Department/Agency or vice versa;

or (3) transferring any agency under the Office of the President to any other Department/Agency or vice versa.Clearly, the provision refers to reduction of personnel, consolidation of offices, or

abolition thereof by reason of economy or redundancy of functions. These point to situations where a body or an office is already existent but a modification or alteration thereof has to be

effected. The creation of an office is nowhere mentioned, much less envisioned in said provision. Accordingly, the answer to the question is in the negative.

To say that the PTC is borne out of a restructuring of the Office of the President under Section 31 is a misplaced supposition, even in the plainest meaning attributable to the term restructure

an alteration of an existing structure. Evidently, the PTC was not part of the structure of the Office of the President prior to the enactment of Executive Order No. 1. As held in Buklod ng Kawaning

EIIB v. Hon. Executive Secretary,[46]

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 [323 SCRA 312 (2000)], 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. [Emphasis Supplied]

In the same vein, the creation of the PTC is not justified by the Presidents power of control. Control is essentially the power to alter or modify or nullify or set aside what a subordinate

officer had done in the performance of his duties and to substitute the judgment of the former with that of the latter. [47] Clearly, the power of control is entirely different from the power to create public

offices. The former is inherent in the Executive, while the latter finds basis from either a valid delegation from Congress, or his inherent duty to faithfully execute the laws.

The question is this, is there a valid delegation of power from Congress, empowering the President to create a public office?

According to the OSG, the power to create a truth commission pursuant to the above provision finds statutory basis under P.D. 1416, as amended by P.D. No. 1772. [48] The said law granted

the President the continuing authority to reorganize the national government, including the power to group, consolidate bureaus and agencies, to abolish offices, to transfer functions, to create and

classify functions, services and activities, transfer appropriations, and to standardize salaries and materials. This decree, in relation to Section 20, Title I, Book III of E.O. 292 has been invoked in

several cases such as Larin v. Executive Secretary.[49]

 The Court, however, declines to recognize P.D. No. 1416 as a justification for the President to create a public office. Said decree is already stale, anachronistic and inoperable. P.D. No. 1416

was a delegation to then President Marcos of the authority to reorganize the administrative structure of the national government including the power to create offices and transfer appropriations

pursuant to one of the purposes of the decree, embodied in its last Whereas clause:

WHEREAS, the transition towards the parliamentary form of government will necessitate flexibility in the organization of the national government.

Clearly, as it was only for the purpose of providing manageability and resiliency during the interim, P.D. No. 1416, as amended by P.D. No. 1772, became functus oficioupon the convening

of the First Congress, as expressly provided in Section 6, Article XVIII of the 1987 Constitution. In fact, even the Solicitor General agrees with this view. Thus:

ASSOCIATE JUSTICE CARPIO: Because P.D. 1416 was enacted was the last whereas clause of P.D. 1416 says it was enacted to prepare the transition from presidential to
parliamentary. Now, in a parliamentary form of government, the legislative and executive powers are fused, correct?

SOLICITOR GENERAL CADIZ: Yes, Your Honor.

ASSOCIATE JUSTICE CARPIO: That is why, that P.D. 1416 was issued. Now would you agree with me that P.D. 1416 should not be considered effective anymore upon the
promulgation, adoption, ratification of the 1987 Constitution.

SOLICITOR GENERAL CADIZ: Not the whole of P.D. [No.] 1416, Your Honor.

ASSOCIATE JUSTICE CARPIO: The power of the President to reorganize the entire National Government is deemed repealed, at least, upon the adoption of the 1987
Constitution, correct.

SOLICITOR GENERAL CADIZ: Yes, Your Honor.[50]

While the power to create a truth commission cannot pass muster on the basis of P.D. No. 1416 as amended by P.D. No. 1772, the creation of the PTC finds justification under Section 17, Article VII

of the Constitution, imposing upon the President the duty to ensure that the laws are faithfully executed. Section 17 reads:

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

As correctly pointed out by the respondents, the allocation of power in the three principal branches of government is a grant of all powers inherent in them. The Presidents power to conduct

investigations to aid him in ensuring the faithful execution of laws in this case, fundamental laws on public accountability and transparency is inherent in the Presidents powers as the Chief Executive.

That the authority of the President to conduct investigations and to create bodies to execute this power is not explicitly mentioned in the Constitution or in statutes does not mean that he is bereft of

such authority.[51] As explained in the landmark case of Marcos v. Manglapus:[52]

 x x x. The 1987 Constitution, however, brought back the presidential system of government and restored the separation of legislative, executive and judicial powers by
their actual distribution among three distinct branches of government with provision for checks and balances.

It would not be accurate, however, to state that "executive power" is the power to enforce the laws, for the President is head of state as well as head of government and
whatever powers inhere in such positions pertain to the office unless the Constitution itself withholds it. Furthermore, the Constitution itself provides that the execution of the laws
is only one of the powers of the President. It also grants the President other powers that do not involve the execution of any provision of law, e.g., his power over the country's
foreign relations.

On these premises, we hold the view that although the 1987 Constitution imposes limitations on the exercise of specific powers of the President, it maintains intact what
is traditionally considered as within the scope of "executive power." Corollarily, the powers of the President cannot be said to be limited only to the specific powers enumerated in
the Constitution. In other words, executive power is more than the sum of specific powers so enumerated.

It has been advanced that whatever power inherent in the government that is neither legislative nor judicial has to be executive. x x x.

Indeed, the Executive is given much leeway in ensuring that our laws are faithfully executed. As stated above, the powers of the President are not limited to those specific powers under the

Constitution.[53] One of the recognized powers of the President granted pursuant to this constitutionally-mandated duty is the power to create ad hoc committees. This flows from the obvious need to

ascertain facts and determine if laws have been faithfully executed. Thus, in Department of Health v. Camposano,[54] the authority of the President to issue Administrative Order No. 298, creating an

investigative committee to look into the administrative charges filed against the employees of the Department of Health for the anomalous purchase of medicines was upheld. In said case, it was ruled:

The Chief Executives power to create the Ad hoc Investigating Committee cannot be doubted. Having been constitutionally granted full control of the Executive Department,
to which respondents belong, the President has the obligation to ensure that all executive officials and employees faithfully comply with the law. With AO 298 as mandate, the
legality of the investigation is sustained. Such validity is not affected by the fact that the investigating team and the PCAGC had the same composition, or that the former used the
offices and facilities of the latter in conducting the inquiry. [Emphasis supplied]

It should be stressed that the purpose of allowing ad hoc investigating bodies to exist is to allow an inquiry into matters which the President is entitled to know so that he can be properly

advised and guided in the performance of his duties relative to the execution and enforcement of the laws of the land. And if history is to be revisited, this was also the objective of the investigative

bodies created in the past like the PCAC, PCAPE, PARGO, the Feliciano Commission, the Melo Commission and the Zenarosa Commission. There being no changes in the government structure, the

Court is not inclined to declare such executive power as non-existent just because the direction of the political winds have changed.

On the charge that Executive Order No. 1 transgresses the power of Congress to appropriate funds for the operation of a public office, suffice it to say that there will be no appropriation but

only an allotment or allocations of existing funds already appropriated. Accordingly, there is no usurpation on the part of the Executive of the power of Congress to appropriate funds. Further, there is

no need to specify the amount to be earmarked for the operation of the commission because, in the words of the Solicitor General, whatever funds the Congress has provided for the Office of the

President will be the very source of the funds for the commission. [55] Moreover, since the amount that would be allocated to the PTC shall be subject to existing auditing rules and regulations, there is

no impropriety in the funding.

Power of the Truth Commission to Investigate

The Presidents power to conduct investigations to ensure that laws are faithfully executed is well recognized. It flows from the faithful-execution clause of the Constitution under Article VII, Section

17 thereof.[56] As the Chief Executive, the president represents the government as a whole and sees to it that all laws are enforced by the officials and employees of his department. He has the authority

to directly assume the functions of the executive department. [57]

Invoking this authority, the President constituted the PTC to primarily investigate reports of graft and corruption and to recommend the appropriate action. As previously stated, no quasi-judicial

powers have been vested in the said body as it cannot adjudicate rights of persons who come before it. It has been said that Quasi-judicial powers involve the power to hear and determine questions of

fact to which the legislative policy is to apply and to decide in accordance with the standards laid down by law itself in enforcing and administering the same law. [58] In simpler terms, judicial

discretion is involved in the exercise of these quasi-judicial power, such that it is exclusively vested in the judiciary and must be clearly authorized by the legislature in the case of administrative

agencies.

The distinction between the power to investigate and the power to adjudicate was delineated by the Court in Cario v. Commission on Human Rights.[59] Thus:

"Investigate," commonly understood, means to examine, explore, inquire or delve or probe into, research on, study. The dictionary definition of "investigate" is "to
observe or study closely: inquire into systematically: "to search or inquire into: x x to subject to an official probe x x: to conduct an official inquiry." The purpose of investigation,
of course, is to discover, to find out, to learn, obtain information. Nowhere included or intimated is the notion of settling, deciding or resolving a controversy involved in the facts
inquired into by application of the law to the facts established by the inquiry.

The legal meaning of "investigate" is essentially the same: "(t)o follow up step by step by patient inquiry or observation. To trace or track; to search into; to examine and
inquire into with care and accuracy; to find out by careful inquisition; examination; the taking of evidence; a legal inquiry;" "to inquire; to make an investigation," "investigation"
being in turn described as "(a)n administrative function, the exercise of which ordinarily does not require a hearing. 2 Am J2d Adm L Sec. 257; x x an inquiry, judicial or otherwise,
for the discovery and collection of facts concerning a certain matter or matters."

"Adjudicate," commonly or popularly understood, means to adjudge, arbitrate, judge, decide, determine, resolve, rule on, settle. The dictionary defines the term as "to
settle finally (the rights and duties of the parties to a court case) on the merits of issues raised: x x to pass judgment on: settle judicially: x x act as judge." And "adjudge" means "to
decide or rule upon as a judge or with judicial or quasi-judicial powers: x x to award or grant judicially in a case of controversy x x."
In the legal sense, "adjudicate" means: "To settle in the exercise of judicial authority. To determine finally. Synonymous with adjudge in its strictest sense;" and "adjudge"
means: "To pass on judicially, to decide, settle or decree, or to sentence or condemn. x x. Implies a judicial determination of a fact, and the entry of a judgment."[Italics included.
Citations Omitted]

Fact-finding is not adjudication and it cannot be likened to the judicial function of a court of justice, or even a quasi-judicial agency or office. The function of receiving evidence and

ascertaining therefrom the facts of a controversy is not a judicial function. To be considered as such, the act of receiving evidence and arriving at factual conclusions in a controversy must be

accompanied by the authority of applying the law to the factual conclusions to the end that the controversy may be decided or resolved authoritatively, finally and definitively, subject to appeals or

modes of review as may be provided by law.[60] Even respondents themselves admit that the commission is bereft of any quasi-judicial power.[61]

Contrary to petitioners apprehension, the PTC will not supplant the Ombudsman or the DOJ or erode their respective powers. If at all, the investigative function of the commission will complement

those of the two offices. As pointed out by the Solicitor General, the recommendation to prosecute is but a consequence of the overall task of the commission to conduct a fact-finding investigation.
[62]
The actual prosecution of suspected offenders, much less adjudication on the merits of the charges against them, [63] is certainly not a function given to the commission. The phrase, when in the
course of its investigation, under Section 2(g), highlights this fact and gives credence to a contrary interpretation from that of the petitioners. The function of determining probable cause for the filing

of the appropriate complaints before the courts remains to be with the DOJ and the Ombudsman. [64]

At any rate, the Ombudsmans power to investigate under R.A. No. 6770 is not exclusive but is shared with other similarly authorized government agencies. Thus, in the case of Ombudsman v. Galicia,
[65]
it was written:

This power of investigation granted to the Ombudsman by the 1987 Constitution and The Ombudsman Act is not exclusive but is shared with other similarly authorized
government agencies such as the PCGG and judges of municipal trial courts and municipal circuit trial courts. The power to conduct preliminary investigation on charges against
public employees and officials is likewise concurrently shared with the Department of Justice. Despite the passage of the Local Government Code in 1991, the Ombudsman retains
concurrent jurisdiction with the Office of the President and the local Sanggunians to investigate complaints against local elective officials. [Emphasis supplied].

Also, Executive Order No. 1 cannot contravene the power of the Ombudsman to investigate criminal cases under Section 15 (1) of R.A. No. 6770, which states:

(1) Investigate and prosecute on its own or on complaint by any person, any act or omission of any public officer or employee, office or agency, when such act or
omission appears to be illegal, unjust, improper or inefficient. It has primary jurisdiction over cases cognizable by the Sandiganbayan and, in the exercise of its primary
jurisdiction, it may take over, at any stage, from any investigatory agency of government, the investigation of such cases. [Emphases supplied]

The act of investigation by the Ombudsman as enunciated above contemplates the conduct of a preliminary investigation or the determination of the existence of probable cause. This is

categorically out of the PTCs sphere of functions. Its power to investigate is limited to obtaining facts so that it can advise and guide the President in the performance of his duties relative to the

execution and enforcement of the laws of the land. In this regard, the PTC commits no act of usurpation of the Ombudsmans primordial duties.

The same holds true with respect to the DOJ. Its authority under Section 3 (2), Chapter 1, Title III, Book IV in the Revised Administrative Code is by no means exclusive and, thus, can be shared with

a body likewise tasked to investigate the commission of crimes.

Finally, nowhere in Executive Order No. 1 can it be inferred that the findings of the PTC are to be accorded conclusiveness. Much like its predecessors, the Davide Commission, the Feliciano

Commission and the Zenarosa Commission, its findings would, at best, be recommendatory in nature. And being so, the Ombudsman and the DOJ have a wider degree of latitude to decide whether or

not to reject the recommendation. These offices, therefore, are not deprived of their mandated duties but will instead be aided by the reports of the PTC for possible indictments for violations of graft

laws.

Violation of the Equal Protection Clause

Although the purpose of the Truth Commission falls within the investigative power of the President, the Court finds difficulty in upholding the constitutionality of Executive Order No. 1 in

view of its apparent transgression of the equal protection clause enshrined in Section 1, Article III (Bill of Rights) of the 1987 Constitution. Section 1 reads:
 Section 1. No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.

The petitioners assail Executive Order No. 1 because it is violative of this constitutional safeguard. They contend that it does not apply equally to all members of the same class such that the

intent of singling out the previous administration as its sole object makes the PTC an adventure in partisan hostility. [66] Thus, in order to be accorded with validity, the commission must also cover

reports of graft and corruption in virtually all administrations previous to that of former President Arroyo. [67]

The petitioners argue that the search for truth behind the reported cases of graft and corruption must encompass acts committed not only during the administration of former President Arroyo

but also during prior administrations where the same magnitude of controversies and anomalies [68] were reported to have been committed against the Filipino people. They assail the classification

formulated by the respondents as it does not fall under the recognized exceptions because first, there is no substantial distinction between the group of officials targeted for investigation by Executive

Order No. 1 and other groups or persons who abused their public office for personal gain; and second, the selective classification is not germane to the purpose of Executive Order No. 1 to end

corruption.[69] In order to attain constitutional permission, the petitioners advocate that the commission should deal with graft and grafters prior and subsequent to the Arroyo administration with the

strong arm of the law with equal force.[70]

Position of respondents

According to respondents, while Executive Order No. 1 identifies the previous administration as the initial subject of the investigation, following Section 17 thereof, the PTC will not

confine itself to cases of large scale graft and corruption solely during the said administration. [71] Assuming arguendo that the commission would confine its proceedings to officials of the previous

administration, the petitioners argue that no offense is committed against the equal protection clause for the segregation of the transactions of public officers during the previous administration as

possible subjects of investigation is a valid classification based on substantial distinctions and is germane to the evils which the Executive Order seeks to correct. [72] To distinguish the Arroyo

administration from past administrations, it recited the following:

First. E.O. No. 1 was issued in view of widespread reports of large scale graft and corruption in the previous administration which have eroded public confidence in
public institutions. There is, therefore, an urgent call for the determination of the truth regarding certain reports of large scale graft and corruption in the government and to put a
closure to them by the filing of the appropriate cases against those involved, if warranted, and to deter others from committing the evil, restore the peoples faith and confidence in
the Government and in their public servants.

Second. The segregation of the preceding administration as the object of fact-finding is warranted by the reality that unlike with administrations long gone, the current
administration will most likely bear the immediate consequence of the policies of the previous administration.

Third. The classification of the previous administration as a separate class for investigation lies in the reality that the evidence of possible criminal activity, the evidence
that could lead to recovery of public monies illegally dissipated, the policy lessons to be learned to ensure that anti-corruption laws are faithfully executed, are more easily
established in the regime that immediately precede the current administration.

Fourth. Many administrations subject the transactions of their predecessors to investigations to provide closure to issues that are pivotal to national life or even as a
routine measure of due diligence and good housekeeping by a nascent administration like the Presidential Commission on Good Government (PCGG), created by the late President
Corazon C. Aquino under Executive Order No. 1 to pursue the recovery of ill-gotten wealth of her predecessor former President Ferdinand Marcos and his cronies, and
 the Saguisag Commission created by former President Joseph Estrada under Administrative Order No, 53, to form an ad-hoc and independent citizens committee to investigate all
the facts and circumstances surrounding Philippine Centennial projects of his predecessor, former President Fidel V. Ramos. [73] [Emphases supplied]

Concept of the Equal Protection Clause

One of the basic principles on which this government was founded is that of the equality of right which is embodied in Section 1, Article III of the 1987 Constitution. The equal protection of the laws

is embraced in the concept of due process, as every unfair discrimination offends the requirements of justice and fair play. It has been embodied in a separate clause, however, to provide for a more

specific guaranty against any form of undue favoritism or hostility from the government. Arbitrariness in general may be challenged on the basis of the due process clause. But if the particular act

assailed partakes of an unwarranted partiality or prejudice, the sharper weapon to cut it down is the equal protection clause.[74]

According to a long line of decisions, equal protection simply requires that all persons or things similarly situated should be treated alike, both as to rights conferred and responsibilities
[75]
imposed. It requires public bodies and institutions to treat similarly situated individuals in a similar manner. [76] The purpose of the equal protection clause is to secure every person within a states

jurisdiction against intentional and arbitrary discrimination, whether occasioned by the express terms of a statue or by its improper execution through the states duly constituted authorities. [77] In other

words, the concept of equal justice under the law requires the state to govern impartially, and it may not draw distinctions between individuals solely on differences that are irrelevant to a legitimate

governmental objective.[78]

The equal protection clause is aimed at all official state actions, not just those of the legislature. [79] Its inhibitions cover all the departments of the government including the political and

executive departments, and extend to all actions of a state denying equal protection of the laws, through whatever agency or whatever guise is taken. [80]

It, however, does not require the universal application of the laws to all persons or things without distinction. What it simply requires is equality among equals as determined according to a

valid classification. Indeed, the equal protection clause permits classification. Such classification, however, to be valid must pass the test of reasonableness. The test has four requisites: (1) The

classification rests on substantial distinctions; (2) It is germane to the purpose of the law; (3) It is not limited to existing conditions only; and

(4) It applies equally to all members of the same class. [81] Superficial differences do not make for a valid classification. [82]

For a classification to meet the requirements of constitutionality, it must include or embrace all persons who naturally belong to the class. [83] The classification will be regarded as invalid if

all the members of the class are not similarly treated, both as to rights conferred and obligations imposed. It is not necessary that the classification be made with absolute symmetry, in the sense that

the members of the class should possess the same characteristics in equal degree. Substantial similarity will suffice; and as long as this is achieved, all those covered by the classification are to be
treated equally. The mere fact that an individual belonging to a class differs from the other members, as long as that class is substantially distinguishable from all others, does not justify the non-

application of the law to him.[84]

 The classification must not be based on existing circumstances only, or so constituted as to preclude addition to the number included in the class. It must be of such a nature as to embrace all

those who may thereafter be in similar circumstances and conditions. It must not leave out or underinclude those that should otherwise fall into a certain classification. As elucidated in Victoriano v.

Elizalde Rope Workers' Union[85] and reiterated in a long line of cases, [86]
The guaranty of equal protection of the laws is not a guaranty of equality in the application of the laws upon all citizens of the state. It is not, therefore, a requirement, in
order to avoid the constitutional prohibition against inequality, that every man, woman and child should be affected alike by a statute. Equality of operation of statutes does not
mean indiscriminate operation on persons merely as such, but on persons according to the circumstances surrounding them. It guarantees equality, not identity of rights. The
Constitution does not require that things which are different in fact be treated in law as though they were the same. The equal protection clause does not forbid discrimination as to
things that are different. It does not prohibit legislation which is limited either in the object to which it is directed or by the territory within which it is to operate.

The equal protection of the laws clause of the Constitution allows classification. Classification in law, as in the other departments of knowledge or practice, is the grouping of
things in speculation or practice because they agree with one another in certain particulars. A law is not invalid because of simple inequality. The very idea of classification is that
of inequality, so that it goes without saying that the mere fact of inequality in no manner determines the matter of constitutionality. All that is required of a valid classification is
that it be reasonable, which means that the classification should be based on substantial distinctions which make for real differences, that it must be germane to the purpose of the
law; that it must not be limited to existing conditions only; and that it must apply equally to each member of the class. This Court has held that the standard is satisfied if the
classification or distinction is based on a reasonable foundation or rational basis and is not palpably arbitrary. [Citations omitted]

Applying these precepts to this case, Executive Order No. 1 should be struck down as violative of the equal protection clause. The clear mandate of the envisioned truth commission is to

investigate and find out the truth concerning the reported cases of graft and corruption during the previous administration[87] only. The intent to single out the previous administration is plain, patent

and manifest. Mention of it has been made in at least three portions of the questioned executive order. Specifically, these are:

WHEREAS, there is a need for a separate body dedicated solely to investigating and finding out the truth concerning the reported cases of graft and corruption during the previous
administration, and which will recommend the prosecution of the offenders and secure justice for all;

SECTION 1. Creation of a Commission. There is hereby created the PHILIPPINE TRUTH COMMISSION, hereinafter referred to as the COMMISSION, which shall primarily
seek and find the truth on, and toward this end, investigate reports of graft and corruption of such scale and magnitude that shock and offend the moral and ethical sensibilities of
the people, committed by public officers and employees, their co-principals, accomplices and accessories from the private sector, if any, during the previous administration; and
thereafter recommend the appropriate action or measure to be taken thereon to ensure that the full measure of justice shall be served without fear or favor.

SECTION 2. Powers and Functions. The Commission, which shall have all the powers of an investigative body under Section 37, Chapter 9, Book I of the Administrative Code of
1987, is primarily tasked to conduct a thorough fact-finding investigation of reported cases of graft and corruption referred to in Section 1, involving third level public officers and
higher, their co-principals, accomplices and accessories from the private sector, if any, during the previous administration and thereafter submit its finding and recommendations
to the President, Congress and the Ombudsman. [Emphases supplied]

In this regard, it must be borne in mind that the Arroyo administration is but just a member of a class, that is, a class of past administrations. It is not a class of its own. Not to include past

administrations similarly situated constitutes arbitrariness which the equal protection clause cannot sanction. Such discriminating differentiation clearly reverberates to label the commission as a

vehicle for vindictiveness and selective retribution.

Though the OSG enumerates several differences between the Arroyo administration and other past administrations, these distinctions are not substantial enough to merit the restriction of the
investigation to the previous administration only. The reports of widespread corruption in the Arroyo administration cannot be taken as basis for distinguishing said administration from earlier

administrations which were also blemished by similar widespread reports of impropriety. They are not inherent in, and do not inure solely to, the Arroyo administration. As Justice Isagani Cruz put it,

Superficial differences do not make for a valid classification. [88]

 The public needs to be enlightened why Executive Order No. 1 chooses to limit the scope of the intended investigation to the previous administration only. The OSG ventures to opine that to

include other past administrations, at this point, may unnecessarily overburden the commission and lead it to lose its effectiveness. [89] The reason given is specious. It is without doubt irrelevant to the

legitimate and noble objective of the PTC to stamp out or end corruption and the evil it breeds. [90]

The probability that there would be difficulty in unearthing evidence or that the earlier reports involving the earlier administrations were already inquired into is beside the point. Obviously,

deceased presidents and cases which have already prescribed can no longer be the subjects of inquiry by the PTC. Neither is the PTC expected to conduct simultaneous investigations of previous

administrations, given the bodys limited time and resources. The law does not require the impossible (Lex non cogit ad impossibilia).[91]

Given the foregoing physical and legal impossibility, the Court logically recognizes the unfeasibility of investigating almost a centurys worth of graft cases. However, the fact remains that

Executive Order No. 1 suffers from arbitrary classification. The PTC, to be true to its mandate of searching for the truth, must not exclude the other past administrations. The PTC must, at least, have

the authority to investigate all past administrations. While reasonable prioritization is permitted, it should not be arbitrary lest it be struck down for being unconstitutional. In the often quoted

language of Yick Wo v. Hopkins,[92]

Though the law itself be fair on its face and impartial in appearance, yet, if applied and administered by public authority with an evil eye and an unequal hand, so as
practically to make unjust and illegal discriminations between persons in similar circumstances, material to their rights, the denial of equal justice is still within the prohibition
of the constitution. [Emphasis supplied]

It could be argued that considering that the PTC is an ad hoc body, its scope is limited. The Court, however, is of the considered view that although its focus is restricted, the constitutional

guarantee of equal protection under the laws should not in any way be circumvented. The Constitution is the fundamental and paramount law of the nation to which all other laws must conform and in

accordance with which all private rights determined and all public authority administered. [93] Laws that do not conform to the Constitution should be stricken down for being unconstitutional. [94] While

the thrust of the PTC is specific, that is, for investigation of acts of graft and corruption, Executive Order No. 1, to survive, must be read together with the provisions of the Constitution. To exclude

the earlier administrations in the guise of substantial distinctions would only confirm the petitioners lament that the subject executive order is only an adventure in partisan hostility. In the case of US

v. Cyprian,[95] it was written: A rather limited number of such classifications have routinely been held or assumed to be arbitrary; those include: race, national origin, gender, political activity or

membership in a political party, union activity or membership in a labor union, or more generally the exercise of first amendment rights.

To reiterate, in order for a classification to meet the requirements of constitutionality, it must include or embrace all persons who naturally belong to the class. [96] Such a classification must

not be based on existing circumstances only, or so constituted as to preclude additions to the number included within a class, but must be of such a nature as to embrace all those who may thereafter be

in similar circumstances and conditions. Furthermore, all who are in situations and circumstances which are relative to the discriminatory legislation and which are indistinguishable from those of the

members of the class must be brought under the influence of the law and treated by it in the same way as are the members of the class. [97]
 The Court is not unaware that mere underinclusiveness is not fatal to the validity of a law under the equal protection clause. [98] Legislation is not unconstitutional merely because it is not all-

embracing and does not include all the evils within its reach. [99] It has been written that a regulation challenged under the equal protection clause is not devoid of a rational predicate simply because it

happens to be incomplete. [100] In several instances, the underinclusiveness was not considered a valid reason to strike down a law or regulation where the purpose can be attained in future legislations

or regulations. These cases refer to the step by step process. [101] With regard to equal protection claims, a legislature does not run the risk of losing the entire remedial scheme simply because it fails,

through inadvertence or otherwise, to cover every evil that might conceivably have been attacked. [102]

In Executive Order No. 1, however, there is no inadvertence. That the previous administration was picked out was deliberate and intentional as can be gleaned from the fact that it was

underscored at least three times in the assailed executive order. It must be noted that Executive Order No. 1 does not even mention any particular act, event or report to be focused on unlike the

investigative commissions created in the past. The equal protection clause is violated by purposeful and intentional discrimination. [103]

To disprove petitioners contention that there is deliberate discrimination, the OSG clarifies that the commission does not only confine itself to cases of large scale graft and corruption

committed during the previous administration.[104] The OSG points to Section 17 of Executive Order No. 1, which provides:

SECTION 17. Special Provision Concerning Mandate. If and when in the judgment of the President there is a need to expand the mandate of the Commission as defined in Section
1 hereof to include the investigation of cases and instances of graft and corruption during the prior administrations, such mandate may be so extended accordingly by way of a
supplemental Executive Order.

The Court is not convinced. Although Section 17 allows the President the discretion to expand the scope of investigations of the PTC so as to include the acts of graft and corruption

committed in other past administrations, it does not guarantee that they would be covered in the future. Such expanded mandate of the commission will still depend on the whim and caprice of the

President. If he would decide not to include them, the section would then be meaningless. This will only fortify the fears of the petitioners that the Executive Order No. 1 was crafted to tailor-fit the

prosecution of officials and personalities of the Arroyo administration. [105]

The Court tried to seek guidance from the pronouncement in the case of Virata v. Sandiganbayan,[106] that the PCGG Charter (composed of Executive Orders Nos. 1, 2 and 14) does not

violate the equal protection clause. The decision, however, was devoid of any discussion on how such conclusory statement was arrived at, the principal issue in said case being only the sufficiency of

a cause of action.

A final word
 The issue that seems to take center stage at present is - whether or not the Supreme Court, in the exercise of its constitutionally mandated power of Judicial Review with respect to recent

initiatives of the legislature and the executive department, is exercising undue interference. Is the Highest Tribunal, which is expected to be the protector of the Constitution, itself guilty of violating

fundamental tenets like the doctrine of separation of powers? Time and again, this issue has been addressed by the Court, but it seems that the present political situation calls for it to once again

explain the legal basis of its action lest it continually be accused of being a hindrance to the nations thrust to progress.

The Philippine Supreme Court, according to Article VIII, Section 1 of the 1987 Constitution, is vested with Judicial Power that includes the duty of the courts of justice to settle actual

controversies involving rights which are legally demandable and enforceable, and to determine whether or not there has been a grave of abuse of discretion amounting to lack or excess of jurisdiction

on the part of any branch or instrumentality of the government.

Furthermore, in Section 4(2) thereof, it is vested with the power of judicial review which is the power to declare a treaty, international or executive agreement, law, presidential decree,

proclamation, order, instruction, ordinance, or regulation unconstitutional. This power also includes the duty to rule on the constitutionality of the application, or operation of presidential decrees,

proclamations, orders, instructions, ordinances, and other regulations. These provisions, however, have been fertile grounds of conflict between the Supreme Court, on one hand, and the two co-equal

bodies of government, on the other. Many times the Court has been accused of asserting superiority over the other departments.

To answer this accusation, the words of Justice Laurel would be a good source of enlightenment, to wit: And when the judiciary mediates to allocate constitutional boundaries, it does not

assert any superiority over the other departments; it does not in reality nullify or invalidate an act of the legislature, but only asserts the solemn and sacred obligation assigned to it by the Constitution

to determine conflicting claims of authority under the Constitution and to establish for the parties in an actual controversy the rights which that instrument secures and guarantees to them. [107]

Thus, the Court, in exercising its power of judicial review, is not imposing its own will upon a co-equal body but rather simply making sure that any act of government is done in consonance

with the authorities and rights allocated to it by the Constitution. And, if after said review, the Court finds no constitutional violations of any sort, then, it has no more authority of proscribing the

actions under review. Otherwise, the Court will not be deterred to pronounce said act as void and unconstitutional.

It cannot be denied that most government actions are inspired with noble intentions, all geared towards the betterment of the nation and its people. But then again, it is important to

remember this ethical principle: The end does not justify the means. No matter how noble and worthy of admiration the purpose of an act, but if the means to be employed in accomplishing it is

simply irreconcilable with constitutional parameters, then it cannot still be allowed. [108] The Court cannot just turn a blind eye and simply let it pass. It will continue to uphold the Constitution and its

enshrined principles.

The Constitution must ever remain supreme. All must bow to the mandate of this law. Expediency must not be allowed to sap its strength nor greed for power debase its
rectitude.[109]
 Lest it be misunderstood, this is not the death knell for a truth commission as nobly envisioned by the present administration. Perhaps a revision of the executive issuance so as to include

the earlier past administrations would allow it to pass the test of reasonableness and not be an affront to the Constitution. Of all the branches of the government, it is the judiciary which is the

most interested in knowing the truth and so it will not allow itself to be a hindrance or obstacle to its attainment. It must, however, be emphasized that the search for the truth must be within

constitutional bounds for ours is still a government of laws and not of men. [110]

WHEREFORE, the petitions are GRANTED. Executive Order No. 1 is hereby declared UNCONSTITUTIONAL insofar as it is violative of the equal protection clause of the Constitution.

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

SO ORDERED.

EN BANC

ANAK MINDANAO PARTY-LIST GROUP, as G.R. No. 166052

represented by Rep. Mujiv S. Hataman, Present:
andMAMALO DESCENDANTS
ORGANIZATION, INC., as represented by its PUNO, C.J.,
Chairman Romy Pardi, QUISUMBING,
Petitioners, YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
CARPIO,
AUSTRIA-MARTINEZ,
- versus - CORONA,
CARPIO MORALES,
AZCUNA,
TINGA,
CHICO-NAZARIO,
THE EXECUTIVE GARCIA,
SECRETARY, THE HON. EDUARDO R. VELASCO, JR.,
ERMITA, and THE SECRETARY OF NACHURA, and
AGRARIAN/LAND REFORM, THE HON. RENE REYES, JJ.
C. VILLA, Promulgated:
Respondents.
August 29, 2007
x----------------------------------------------------------------------------------------x

DECISION

CARPIO MORALES, J.:

Petitioners Anak Mindanao Party-List Group (AMIN) and Mamalo Descendants Organization, Inc. (MDOI) assail the constitutionality of Executive Order (E.O.) Nos. 364 and 379, both issued in

2004, via the present Petition for Certiorari and Prohibition with prayer for injunctive relief.
E.O. No. 364, which President Gloria Macapagal-Arroyo issued on September 27, 2004, reads:

EXECUTIVE ORDER NO. 364

TRANSFORMING THE DEPARTMENT OF AGRARIAN REFORM INTO THE DEPARTMENT OF LAND REFORM

WHEREAS, one of the five reform packages of the Arroyo administration is Social Justice and Basic [N]eeds;

WHEREAS, one of the five anti-poverty measures for social justice is asset reform;

WHEREAS, asset reforms covers [sic] agrarian reform, urban land reform, and ancestral domain reform;

WHEREAS, urban land reform is a concern of the Presidential Commission [for] the Urban Poor (PCUP) and ancestral domain reform is a concern of the National Commission on
Indigenous Peoples (NCIP);

WHEREAS, another of the five reform packages of the Arroyo administration is Anti-Corruption and Good Government;

WHEREAS, one of the Good Government reforms of the Arroyo administration is rationalizing the bureaucracy by consolidating related functions into one department;

WHEREAS, under law and jurisprudence, the President of the Philippines has broad powers to reorganize the offices under her supervision and control;

NOW[,] THEREFORE[,] I, Gloria Macapagal-Arroyo, by the powers vested in me as President of the Republic of the Philippines, do hereby order:

SECTION 1. The Department of Agrarian Reform is hereby transformed into the Department of Land Reform. It shall be responsible for all land reform in the country,
including agrarian reform, urban land reform, and ancestral domain reform.

SECTION 2. The PCUP is hereby placed under the supervision and control of the Department of Land Reform . The Chairman of the PCUP shall be ex-officio Undersecretary
of the Department of Land Reform for Urban Land Reform.

SECTION 3. The NCIP is hereby placed under the supervision and control of the Department of Land Reform. The Chairman of the NCIP shall be ex-officio Undersecretary of the
Department of Land Reform for Ancestral Domain Reform.

SECTION 4. The PCUP and the NCIP shall have access to the services provided by the Departments Finance, Management and Administrative Office; Policy, Planning and Legal
Affairs Office, Field Operations and Support Services Office, and all other offices of the Department of Land Reform.

SECTION 5. All previous issuances that conflict with this Executive Order are hereby repealed or modified accordingly.

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

E.O. No. 379, which amended E.O. No. 364 a month later or on October 26, 2004, reads:

EXECUTIVE ORDER NO. 379

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

WHEREAS, Republic Act No. 8371 created the National Commission on Indigenous Peoples;
 WHEREAS, pursuant to the Administrative Code of 1987, the President has the continuing authority to reorganize the administrative structure of the National Government.

NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by the Constitution and existing
laws, do hereby order:

Section 1. Amending Section 3 of Executive Order No. 364. Section 3 of Executive Order No. 364, dated September 27, 2004 shall now read as follows:

Section 3. The National Commission on Indigenous Peoples (NCIP) shall be an attached agency of the Department of Land Reform.

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

Section 3. Repealing Clause. All executive issuances, rules and regulations or parts thereof which are inconsistent with this Executive Order are hereby revoked, amended or
modified accordingly.

Section 4. Effectivity. This Executive Order shall take effect immediately. (Emphasis and underscoring in the original)

Petitioners contend that the two presidential issuances are unconstitutional for violating:

- THE CONSTITUTIONAL PRINCIPLES OF SEPARATION OF POWERS AND OF THE RULE OF LAW[;]

- THE CONSTITUTIONAL SCHEME AND POLICIES FOR AGRARIAN REFORM, URBAN LAND REFORM, INDIGENOUS PEOPLES RIGHTS AND ANCESTRAL
DOMAIN[; AND]
- THE CONSTITUTIONAL RIGHT OF THE PEOPLE AND THEIR ORGANIZATIONS TO EFFECTIVE AND REASONABLE PARTICIPATION IN DECISION-
MAKING, INCLUDING THROUGH ADEQUATE CONSULTATION[.][1]

By Resolution of December 6, 2005, this Court gave due course to the Petition and required the submission of memoranda, with which petitioners and respondents complied onMarch 24,

2006 and April 11, 2006, respectively.

The issue on the transformation of the Department of Agrarian Reform (DAR) into the Department of Land Reform (DLR) became moot and academic, however, the department having reverted to its

former name by virtue of E.O. No. 456[2] which was issued on August 23, 2005.

The Court is thus left with the sole issue of the legality of placing the Presidential Commission [3] for the Urban Poor (PCUP) under the supervision and control of the DAR, and the National

Commission on Indigenous Peoples (NCIP) under the DAR as an attached agency.

Before inquiring into the validity of the reorganization, petitioners locus standi or legal standing, inter alia,[4] becomes a preliminary question.

The Office of the Solicitor General (OSG), on behalf of respondents, concedes that AMIN [5] has the requisite legal standing to file this suit as member [6] of Congress.

Petitioners find it impermissible for the Executive to intrude into the domain of the Legislature. They posit that an act of the Executive which injures the institution of Congress causes a derivative but

nonetheless substantial injury, which can be questioned by a member of Congress. [7] They add that to the extent that the powers of Congress are impaired, so is the power of each member thereof,

since his office confers a right to participate in the exercise of the powers of that institution. [8]
 Indeed, a member of the House of Representatives has standing to maintain inviolate the prerogatives, powers and privileges vested by the Constitution in his office. [9]

The OSG questions, however, the standing of MDOI, a registered peoples organization of Teduray and Lambangian tribesfolk of (North) Upi and South Upi in the province ofMaguindanao.

As co-petitioner, MDOI alleges that it is concerned with the negative impact of NCIPs becoming an attached agency of the DAR on the processing of ancestral domain claims. It fears that transferring

the NCIP to the DAR would affect the processing of ancestral domain claims filed by its members.

Locus standi or legal standing has been defined as a personal and substantial interest in a case such that the party has sustained or will sustain direct injury as a result of the governmental act that is

being challenged. The gist of the question of standing is whether a party alleges such personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the

presentation of issues upon which the court depends for illumination of difficult constitutional questions. [10]

It has been held that a party who assails the constitutionality of a statute must have a direct and personal interest. It must show not only that the law or any governmental act is invalid, but also that it

sustained or is in immediate danger of sustaining some direct injury as a result of its enforcement, and not merely that it suffers thereby in some indefinite way. It must show that it has been or is about

to be denied some right or privilege to which it is lawfully entitled or that it is about to be subjected to some burdens or penalties by reason of the statute or act complained of. [11]

For a concerned party to be allowed to raise a constitutional question, it must show that (1) it has personally suffered some actual or threatened injury as a result of the allegedly illegal conduct of the

government, (2) the injury is fairly traceable to the challenged action, and (3) the injury is likely to be redressed by a favorable action. [12]

An examination of MDOIs nebulous claims of negative impact and probable setbacks [13] shows that they are too abstract to be considered judicially cognizable. And the line of causation it proffers

between the challenged action and alleged injury is too attenuated.

Vague propositions that the implementation of the assailed orders will work injustice and violate the rights of its members cannot clothe MDOI with the requisite standing. Neither would its

status as a peoples organization vest it with the legal standing to assail the validity of the executive orders. [14]

La Bugal-Blaan Tribal Association, Inc. v. Ramos, [15] which MDOI cites in support of its claim to legal standing, is inapplicable as it is not similarly situated with the therein petitioners who

alleged personal and substantial injury resulting from the mining activities permitted by the assailed statute. And so is Cruz v. Secretary of Environment and Natural Resources, [16] for the indigenous

peoples leaders and organizations were not the petitioners therein, who necessarily had to satisfy the locus standi requirement, but were intervenors who sought and were allowed to be impleaded, not

to assail but to defend the constitutionality of the statute.

Moreover, MDOI raises no issue of transcendental importance to justify a relaxation of the rule on legal standing. To be accorded standing on the ground of transcendental importance, Senate of the
Philippines v. Ermita[17] requires that the following elements must be established: (1) the public character of the funds or other assets involved in the case, (2) the presence of a clear case of disregard

of a constitutional or statutory prohibition by the public respondent agency or instrumentality of government, and (3) the lack of any other party with a more direct and specific interest in raising the

questions being raised. The presence of these elements MDOI failed to establish, much less allege.
Francisco, Jr. v. Fernando[18] more specifically declares that the transcendental importance of the issues raised must relate to the merits of the petition.

This Court, not being a venue for the ventilation of generalized grievances, must thus deny adjudication of the matters raised by MDOI.

Now, on AMINs position. AMIN charges the Executive Department with transgression of the principle of separation of powers.

Under the principle of separation of powers, Congress, the President, and the Judiciary may not encroach on fields allocated to each of them. The legislature is generally limited to the

enactment of laws, the executive to the enforcement of laws, and the judiciary to their interpretation and application to cases and controversies. The principle presupposes mutual respect by and

between the executive, legislative and judicial departments of the government and calls for them to be left alone to discharge their duties as they see fit. [19]

AMIN contends that since the DAR, PCUP and NCIP were created by statutes, [20] they can only be transformed, merged or attached by statutes, not by mere executive orders.

While AMIN concedes that the executive power is vested in the President [21] who, as Chief Executive, holds the power of control of all the executive departments, bureaus, and offices, [22] it posits that

this broad power of control including the power to reorganize is qualified and limited, for it cannot be exercised in a manner contrary to law, citing the constitutional duty [23] of the President to ensure

that the laws, including those creating the agencies, be faithfully executed.

AMIN cites the naming of the PCUP as a presidential commission to be clearly an extension of the President, and the creation of the NCIP as an independent agency under the Office of the President.
[24]
It thus argues that since the legislature had seen fit to create these agencies at separate times and with distinct mandates, the President should respect that legislative disposition.

In fine, AMIN contends that any reorganization of these administrative agencies should be the subject of a statute.

AMINs position fails to impress.

The Constitution confers, by express provision, the power of control over executive departments, bureaus and offices in the President alone. And it lays down a limitation on the legislative

power.

The line that delineates the Legislative and Executive power is not indistinct. Legislative power is the authority, under the Constitution, to make laws, and to alter and repeal
them. The Constitution, as the will of the people in their original, sovereign and unlimited capacity, has vested this power in the Congress of the Philippines. The grant of
legislative power to Congress is broad, general and comprehensive. The legislative body possesses plenary power for all purposes of civil government. Any power, deemed to be
legislative by usage and tradition, is necessarily possessed by Congress, unless the Constitution has lodged it elsewhere. In fine, except as limited by the Constitution, either
expressly or impliedly, legislative power embraces all subjects and extends to matters of general concern or common interest.

While Congress is vested with the power to enact laws, the President executes the laws. The executive power is vested in the President. It is generally defined as the power to
enforce and administer the laws. It is the power of carrying the laws into practical operation and enforcing their due observance.

As head of the Executive Department, the President is the Chief Executive. He represents the government as a whole and sees to it that all laws are enforced by the officials and
employees of his department. He has control over the executive department, bureaus and offices. This means that he has the authority to assume directly the functions of the
 executive department, bureau and office, or interfere with the discretion of its officials. Corollary to the power of control, the President also has the duty of supervising and
enforcement of laws for the maintenance of general peace and public order. Thus, he is granted administrative power over bureaus and offices under his control to enable him to
discharge his duties effectively.[25] (Italics omitted, underscoring supplied)

The Constitutions express grant of the power of control in the President justifies an executive action to carry out reorganization measures under a broad authority of law. [26]

In enacting a statute, the legislature is presumed to have deliberated with full knowledge of all existing laws and jurisprudence on the subject. [27] It is thus reasonable to conclude that in passing a

statute which places an agency under the Office of the President, it was in accordance with existing laws and jurisprudence on the Presidents power to reorganize.

In establishing an executive department, bureau or office, the legislature necessarily ordains an executive agencys position in the scheme of administrative structure. Such determination is primary,
[28]
but subject to the Presidents continuing authority to reorganize the administrative structure. As far as bureaus, agencies or offices in the executive department are concerned, the power of control

may justify the President to deactivate the functions of a particular office. Or a law may expressly grant the President the broad authority to carry out reorganization measures. [29] The Administrative

Code of 1987 is one such law:[30]

SEC. 30. Functions of Agencies under the Office of the President. Agencies under the Office of the President shall continue to operate and function in accordance with their
respective charters or laws creating them, except as otherwise provided in this Code or by law.
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 or
agencies.[31](Italics in the original; emphasis and underscoring supplied)

In carrying out the laws into practical operation, the President is best equipped to assess whether an executive agency ought to continue operating in accordance with its charter or the law creating

it. This is not to say that the legislature is incapable of making a similar assessment and appropriate action within its plenary power. The Administrative Code of 1987 merely underscores the need to

provide the President with suitable solutions to situations on hand to meet the exigencies of the service that may call for the exercise of the power of control.

x x x The law grants the President this power in recognition of the recurring need of every President to reorganize his office to achieve simplicity, economy and efficiency. The
Office of the President is the nerve center of the 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. [32]

The Office of the President consists of the Office of the President proper and the agencies under it. [33] It is not disputed that PCUP and NCIP were formed as agencies under the Office of the President.
[34]
The Agencies under the Office of the President refer to those offices placed under the chairmanship of the President, those under the supervision and control of the President, those under the
administrative supervision of the Office of the President, those attached to the Office for policy and program coordination, and those that are not placed by law or order creating them under any special

department.[35]

As thus provided by law, the President may transfer any agency under the Office of the President to any other department or agency, subject to the policy in the Executive Office and in order to

achieve simplicity, economy and efficiency. Gauged against these guidelines,[36] the challenged executive orders may not be said to have been issued with grave abuse of discretion or in violation of

the rule of law.

The references in E.O. 364 to asset reform as an anti-poverty measure for social justice and to rationalization of the bureaucracy in furtherance of good government [37]encapsulate a portion of the

existing policy in the Executive Office. As averred by the OSG, the President saw it fit to streamline the agencies so as not to hinder the delivery of crucial social reforms. [38]

The consolidation of functions in E.O. 364 aims to attain the objectives of simplicity, economy and efficiency as gathered from the provision granting PCUP and NCIP access to the range of services

provided by the DARs technical offices and support systems. [39]

The characterization of the NCIP as an independent agency under the Office of the President does not remove said body from the Presidents control and supervision with respect to its performance of

administrative functions. So it has been opined:

That Congress did not intend to place the NCIP under the control of the President in all instances is evident in the IPRA itself, which provides that the decisions of the NCIP in the
exercise of its quasi-judicial functions shall be appealable to the Court of Appeals, like those of the National Labor Relations Commission (NLRC) and the Securities and
Exchange Commission (SEC). Nevertheless, the NCIP, although independent to a certain degree, was placed by Congress under the office of the President and, as such, is still
subject to the Presidents power of control and supervision granted under Section 17, Article VII of the Constitution with respect to its performance of administrative functions[.]
[40]
(Underscoring supplied)

In transferring the NCIP to the DAR as an attached agency, the President effectively tempered the exercise of presidential authority and considerably recognized that degree of independence.

The Administrative Code of 1987 categorizes administrative relationships into (1) supervision and control, (2) administrative supervision, and (3) attachment. [41] With respect to the third category, it

has been held that an attached agency has a larger measure of independence from the Department to which it is attached than one which is under departmental supervision and control or administrative

supervision. This is borne out by the lateral relationship between the Department and the attached agency. The attachment is merely for policy and program coordination. [42] Indeed, the essential

autonomous character of a board is not negated by its attachment to a commission. [43]

AMIN argues, however, that there is an anachronism of sorts because there can be no policy and program coordination between conceptually different areas of reform. It claims that the new

framework subsuming agrarian reform, urban land reform and ancestral domain reform is fundamentally incoherent in view of the widely different contexts. [44] And it posits that it is a substantive

transformation or reorientation that runs contrary to the constitutional scheme and policies.
AMIN goes on to proffer the concept of ordering the law [45] which, so it alleges, can be said of the Constitutions distinct treatment of these three areas, as reflected in separate provisions in different

parts of the Constitution.[46] It argues that the Constitution did not intend an over-arching concept of agrarian reform to encompass the two other areas, and that how the law is ordered in a certain way

should not be undermined by mere executive orders in the guise of administrative efficiency.

The Court is not persuaded.

The interplay of various areas of reform in the promotion of social justice is not something implausible or unlikely. [47] Their interlocking nature cuts across labels and works against a rigid

pigeonholing of executive tasks among the members of the Presidents official family. Notably, the Constitution inhibited from identifying and compartmentalizing the composition of the Cabinet. In

vesting executive power in one person rather than in a plural executive, the evident intention was to invest the power holder with energy. [48]

AMIN takes premium on the severed treatment of these reform areas in marked provisions of the Constitution. It is a precept, however, that inferences drawn from title, chapter or section headings are

entitled to very little weight.[49] And so must reliance on sub-headings,[50] or the lack thereof, to support a strained deduction be given the weight of helium.

Secondary aids may be consulted to remove, not to create doubt. [51] AMINs thesis unsettles, more than settles the order of things in construing the Constitution. Its interpretation fails to

clearly establish that the so-called ordering or arrangement of provisions in the Constitution was consciously adopted to imply a signification in terms of government hierarchy from where a

constitutional mandate can per se be derived or asserted. It fails to demonstrate that the ordering or layout was not simply a matter of style in constitutional drafting but one of intention in government

structuring. With its inherent ambiguity, the proposed interpretation cannot be made a basis for declaring a law or governmental act unconstitutional.

A law has in its favor the presumption of constitutionality. For it to be nullified, it must be shown that there is a clear and unequivocal breach of the Constitution. The ground for nullity must be clear

and beyond reasonable doubt.[52] Any reasonable doubt should, following the universal rule of legal hermeneutics, be resolved in favor of the constitutionality of a law. [53]

Ople v. Torres[54] on which AMIN relies is unavailing. In that case, an administrative order involved a system of identification that required a delicate adjustment of various contending state policies

properly lodged in the legislative arena. It was declared unconstitutional for dealing with a subject that should be covered by law and for violating the right to privacy.

In the present case, AMIN glaringly failed to show how the reorganization by executive fiat would hamper the exercise of citizens rights and privileges. It rested on the ambiguous conclusion that the

reorganization jeopardizes economic, social and cultural rights. It intimated, without expounding, that the agendum behind the issuances is to weaken the indigenous peoples rights in favor of the

mining industry. And it raised concerns about the possible retrogression in DARs performance as the added workload may impede the implementation of the comprehensive agrarian reform program.

AMIN has not shown, however, that by placing the NCIP as an attached agency of the DAR, the President altered the nature and dynamics of the jurisdiction and adjudicatory functions of the NCIP
concerning all claims and disputes involving rights of indigenous cultural communities and

indigenous peoples. Nor has it been shown, nay alleged, that the reorganization was made in bad faith. [55]
As for the other arguments raised by AMIN which pertain to the wisdom or soundness of the executive decision, the Court finds it unnecessary to pass upon them. The raging debate on the most

fitting framework in the delivery of social services is endless in the political arena. It is not the business of this Court to join in the fray. Courts have no judicial power to review cases involving

political questions and, as a rule, will desist from taking cognizance of speculative or hypothetical cases, advisory opinions and cases that have become moot. [56]

Finally, a word on the last ground proffered for declaring the unconstitutionality of the assailed issuances that they violate Section 16, Article XIII of the Constitution [57] on the peoples right to

participate in decision-making through adequate consultation mechanisms.

The framers of the Constitution recognized that the consultation mechanisms were already operating without the States action by law, such that the role of the State would be mere

facilitation, not necessarily creation of these consultation mechanisms. The State provides the support, but eventually it is the people, properly organized in their associations, who can assert the right

and pursue the objective. Penalty for failure on the part of the government to consult could only be reflected in the ballot box and would not nullify government action. [58]

WHEREFORE, the petition is DISMISSED. Executive Order Nos. 364 and 379 issued on September 27, 2004 and October 26, 2004, respectively, are declared not unconstitutional.

SO ORDERED.

FIRST DIVISION

[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 letter-appeal 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

`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 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.

`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.

`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.

`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.

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 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 Properallowing the President to transfer any function under
the Office of the President to any other Department or Agency and vice-versa, and the transfer of any agency under the Office of the President to any other department or agency and vice-versa.[14]

In the present instance, involving neither an abolition nor transfer of offices, the assailed action is a mere reorganization under the general provisions of the law consisting mainly
of streamlining the NTA in the interest of simplicity, economy and efficiency. It is an act well within the authority of President motivated and carried out, according to the findings of the appellate
court, in good faith, a factual assessment that this Court could only but accept. [15]
 In passing, relative to petitioners Motion for an En Banc Resolution of the Case, it may be well to remind counsel, that the Court En Banc is not an appellate tribunal to which appeals from a
Division of the Court may be taken. A Division of the Court is the Supreme Court as fully and veritably as the Court En Banc itself and a decision of its Division is as authoritative and final as a
decision of the Court En Banc. Referrals of cases from a Division to the Court En Banc do not take place as just a matter of routine but only on such specified grounds as the Court in its discretion
may allow.[16]

WHEREFORE, the Motion to Admit Petition for En Banc resolution and the Petition for an En Banc Resolution are DENIED for lack of merit. Let entry of judgment be made in due
course. No costs.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Ynares-Santiago, Carpio, and Azcuna, JJ., concur.

SECOND DIVISION

KAPISANAN NG MGA KAWANI NG ENERGY G.R. No. 150974

REGULATORY BOARD,
Petitioner, Present:

QUISUMBING,* J.,
Chairperson,
CARPIO,**
- versus - CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ.

COMMISSIONER FE B. BARIN, DEPUTY

COMMISSIONERS CARLOS R. ALINDADA, LETICIA V.
IBAY, OLIVER B. BUTALID, and MARY ANNE B.
COLAYCO, of the ENERGY REGULATORY
COMMISSION,
Respondents. Promulgated:

June 29, 2007

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

DECISION

CARPIO, J.:
 The Case

This is a special civil action for certiorari and prohibition [1] of the selection and appointment of employees of the Energy Regulatory Commission (ERC) by the ERC Board of Commissioners.

Petitioner Kapisanan ng mga Kawani ng Energy Regulatory Board (KERB) seeks to declare Section 38 of Republic Act No. 9136 (RA 9136), which abolished the Energy Regulatory Board (ERB) and

created the ERC, as unconstitutional and to prohibit the ERC Commissioners from filling up the ERCs plantilla.

The Facts

RA 9136, popularly known as EPIRA (for Electric Power Industry Reform Act of 2001), was enacted on 8 June 2001 and took effect on 26 June 2001. Section 38 of RA 9136 provides for the abolition

of the ERB and the creation of the ERC. The pertinent portions of Section 38 read:

Creation of the Energy Regulatory Commission. There is hereby created an independent, quasi-judicial regulatory board to be named the Energy Regulatory Commission
(ERC). For this purpose, the existing Energy Regulatory Board (ERB) created under Executive Order No. 172, as amended, is hereby abolished.

The Commission shall be composed of a Chairman and four (4) members to be appointed by the President of the Philippines. x x x

Within three (3) months from the creation of the ERC, the Chairman shall submit for the approval of the President of the Philippines the new organizational structure
and plantilla positions necessary to carry out the powers and functions of the ERC.

xxxx

The Chairman and members of the Commission shall assume office at the beginning of their terms: Provided, That, if upon the effectivity of this Act, the Commission has not been
constituted and the new staffing pattern and plantilla positions have not been approved and filled-up, the current Board and existing personnel of ERB shall continue to hold office.

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

At the time of the filing of this petition, the ERC was composed of Commissioner Fe B. Barin and Deputy Commissioners Carlos R. Alindada, Leticia V. Ibay, Oliver B. Butalid, and Mary Anne

B. Colayco (collectively, Commissioners). The Commissioners assumed office on 15 August 2001. Pursuant to Section 38 of RA 9136, the Commissioners issued the proposed Table of Organization,

Staffing Pattern, and Salary Structure on 25 September 2001 which the President of the Philippines approved on 13 November 2001.Meanwhile, KERB submitted to the Commissioners its Resolution
No. 2001-02 on 13 September 2001. Resolution No. 2001-02 requested the Commissioners for an opportunity to be informed on the proposed plantilla positions with their equivalent qualification

standards.

On 17 October 2001, the Commissioners issued the guidelines for the selection and hiring of ERC employees. A portion of the guidelines reflects the Commissioners view on the selection and hiring

of the ERC employees vis-a-vis Civil Service rules, thus:

Since R.A. 9136 has abolished the Energy Regulatory Board (ERB), it is the view of the Commission that the provisions of Republic Act No. 6656 (An Act to Protect the Security
of [Tenure of] Civil Service Officers and Employees in the Implementation of Government Reorganization) will not directly apply to ERCs current efforts to establish a new
organization. Civil Service laws, rules and regulations, however, will have suppletory application to the extent possible in regard to the selection and placement of employees in the
ERC.[2] (Emphasis supplied)

On 5 November 2005, KERB sent a letter to the Commissioners stating the KERB members objection to the Commissioners stand that Civil Service laws, rules and regulations

have suppletory application in the selection and placement of the ERC employees. KERB asserted that RA 9136 did not abolish the ERB or change the ERBs character as an economic regulator of the

electric power industry. KERB insisted that RA 9136 merely changed the ERBs name to the ERC and expanded the ERBs functions and objectives.KERB sent the Commissioners yet another letter

on 13 November 2001. KERB made a number of requests: (1) the issuance of a formal letter related to the date of filing of job applications, including the use of Civil Service application form no. 212;

(2) the creation of a placement/recruitment committee and setting guidelines relative to its functions, without prejudice to existing Civil Service rules and regulations; and (3) copies of

the plantilla positions and their corresponding qualification standards duly approved by either the President of the Philippines or the Civil Service Commission (CSC).

Commissioner Barin replied to KERBs letter on 15 November 2001. She stated that Civil Service application form no. 212 and the ERC-prescribed application format are substantially the

same. Furthermore, the creation of a placement/recruitment committee is no longer necessary because there is already a prescribed set of guidelines for the recruitment of personnel. The ERC hired an

independent consultant to administer the necessary tests for the technical and managerial levels. Finally, the ERC already posted the plantilla positions, which prescribe higher standards, as approved

by the Department of Budget and Management. Commissioner Barin stated that positions in the ERC do not need the prior approval of the CSC, as the ERC is only required to submit the qualification

standards to the CSC.

On 5 December 2001, the ERC published a classified advertisement in the Philippine Star. Two days later, the CSC received a list of vacancies and qualification standards from the ERC. The ERC

formed a Selection Committee to process all applications.

KERB, fearful of the uncertainty of the employment status of its members, filed the present petition on 20 December 2001. KERB later filed an Urgent Ex Parte Motion to Enjoin Termination of

Petitioner ERB Employees on 2 January 2002. However, before the ERC received KERBs pleadings, the Selection Committee already presented its list of proposed appointees to the Commissioners.
In their Comment, the Commissioners describe the status of the ERB employees appointment in the ERC as follows:

As of February 1, 2002, of the two hundred twelve (212) ERB employees, one hundred thirty eighty [sic] (138) were rehired and appointed to ERC plantilla positions and sixty six
(66) opted to retire or be separated from the service. Those who were rehired and those who opted to retire or be separated constituted about ninety six (96%) percent of the entire
ERB employees. The list of the ERB employees appointed to new positions in the ERC is attached hereto as Annex 1. Only eight (8) ERB employees could not be appointed to
new positions due to the reduction of the ERC plantilla and the absence of positions appropriate to their respective qualifications and skills. The appropriate notice was issued to
each of them informing them of their separation from the service and assuring them of their entitlement to separation pay and other benefits in accordance with existing laws. [3]

The Issues

KERB raises the following issues before this Court:

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

2. Whether the Commissioners of the ERC were correct in disregarding and considering merely suppletory in character the protective mantle of RA 6656 as to the ERB
employees or petitioner in this case.[4]

The Ruling of the Court

The petition has no merit.

We disregard the procedural defects in the petition, such as KERBs personality to file the petition on behalf of its alleged members and Elmar Agirs authority to institute the action, because of the

demands of public interest.[5]

Constitutionality of the ERBs Abolition

and the ERCs Creation

All laws enjoy the presumption of constitutionality. To justify the nullification of a law, there must be a clear and unequivocal breach of the Constitution. KERB failed to show any breach of the

Constitution.

A public office is created by the Constitution or by law or by an officer or tribunal to which the power to create the office has been delegated by the legislature. [6] The power to create an office carries

with it the power to abolish. President Corazon C. Aquino, then exercising her legislative powers, created the ERB by issuing Executive Order No. 172 on8 May 1987.
The question of whether a law abolishes an office is a question of legislative intent. There should not be any controversy if there is an explicit declaration of abolition in the law itself. [7] Section 38 of

RA 9136 explicitly abolished the ERB. However, abolition of an office and its related positions is different from removal of an incumbent from his office.Abolition and removal are mutually exclusive

concepts. From a legal standpoint, there is no occupant in an abolished office. Where there is no occupant, there is no tenure to speak of. Thus, impairment of the constitutional guarantee of security of

tenure does not arise in the abolition of an office. On the other hand, removal implies that the office and its related positions subsist and that the occupants are merely separated from their positions. [8]

A valid order of abolition must not only come from a legitimate body, it must also be made in good faith. An abolition is made in good faith when it is not made for political or personal reasons, or

when it does not circumvent the constitutional security of tenure of civil service employees. [9] Abolition of an office may be brought about by reasons of economy, or to remove redundancy of

functions, or a clear and explicit constitutional mandate for such termination of employment. [10] Where one office is abolished and replaced with another office vested with similar functions, the

abolition is a legal nullity.[11] When there is a void abolition, the incumbent is deemed to have never ceased holding office.

KERB asserts that there was no valid abolition of the ERB but there was merely a reorganization done in bad faith. Evidences of bad faith are enumerated in Section 2 of Republic Act No. 6656 (RA

6656),[12] Section 2 of RA 6656 reads:

No officer or employee in the career service shall be removed except for a valid cause and after due notice and hearing. A valid cause for removal exists when, pursuant to a bona
fidereorganization, a position has been abolished or 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 function as the original offices;

(e) Where the removal violates the order of separation provided in Section 3 hereof.

KERB claims that the present case falls under the situation described in Section 2(b) of RA 6656. We thus need to compare the provisions enumerating the powers and functions of the ERB and the

ERC to see whether they have substantially the same functions. Under Executive Order No. 172, the ERB has the following powers and functions:

SEC. 3. Jurisdiction, Powers and Functions of the Board. When warranted and only when public necessity requires, the Board may regulate the business of importing,
exporting, re-exporting, shipping, transporting, processing, refining, marketing and distributing energy resources. Energy resource means any substance or phenomenon which by
 itself or in combination with others, or after processing or refining or the application to it of technology, emanates, generates or causes the emanation or generation of energy, such
as but not limited to, petroleum or petroleum products, coal, marsh gas, methane gas, geothermal and hydroelectric sources of energy, uranium and other similar radioactive
minerals, solar energy, tidal power, as well as non-conventional existing and potential sources.

The Board shall, upon proper notice and hearing, exercise the following, among other powers and functions:

(a) Fix and regulate the prices of petroleum products;

(b) Fix and regulate the rate schedule or prices of piped gas to be charged by duly franchised gas companies which distribute gas by means of underground pipe system;

(c) Fix and regulate the rates of pipeline concessionaires under the provisions of Republic Act No. 387, as amended, otherwise known as the Petroleum Act of 1949, as amended by
Presidential Decree No. 1700;

(d) Regulate the capacities of new refineries or additional capacities of existing refineries and license refineries that may be organized after the issuance of this Executive Order,
under such terms and conditions as are consistent with the national interest;

(e) Whenever the Board has determined that there is a shortage of any petroleum product, or when public interest so requires, it may take such steps as it may consider necessary,
including the temporary adjustment of the levels of prices of petroleum products and the payment to the Oil Price Stabilization Fund created under Presidential Decree No. 1956
by persons or entities engaged in the petroleum industry of such amounts as may be determined by the Board, which will enable the importer to recover its cost of importation.

SEC. 4. Reorganized or Abolished Agency. (a) The Board of Energy is hereby reconstituted into the Energy Regulatory Board, and the formers powers and functions under
Republic Act No. 6173, as amended by Presidential Decree No. 1208, as amended, are transferred to the latter.

(b) The regulatory and adjudicatory powers and functions exercised by the Bureau of Energy Utilization under Presidential Decree No. 1206, as amended, are transferred to the
Board, the provisions of Executive Order No. 131 notwithstanding.

SEC. 5. Other Transferred Powers and Functions. The power of the Land Transportation Commission to determine, fix and/or prescribe rates or charges pertaining to the
hauling of petroleum products are transferred to the Board. The power to fix and regulate the rates or charges pertinent to shipping or transporting of petroleum products shall also
be exercised by the Board.

The foregoing transfer of powers and functions shall include applicable funds and appropriations, records, equipment, property and such personnel as may be necessary; Provided,
That with reference to paragraph (b) of Section 4 hereof, only such amount of funds and appropriations of the Bureau of Energy Utilization, as well as only the personnel thereof
who are completely or primarily involved in the exercise by said Bureau of its regulatory and adjudicatory powers and functions, shall be affected by such transfer: Provided,
further, That the funds and appropriations as well as the records, equipment, property and all personnel of the reorganized Board of Energy shall be transferred to the Energy
Regulatory Board.

SEC. 6. Power to Promulgate Rules and Perform Other Acts. The Board shall have the power to promulgate rules and regulations relevant to procedures governing hearings
before it and enforce compliance with any rule, regulation, order or other requirements: Provided, That said rules and regulations shall take effect fifteen (15) days after publication
in the Official Gazette. It shall also perform such other acts as may be necessary or conducive to the exercise of its powers and functions, and the attainment of the purposes of this
Order.

On the other hand, Section 43 of RA 9136 enumerates the basic functions of the ERC.
SEC. 43. Functions of the ERC. The ERC shall promote competition, encourage market development, ensure customer choice and discourage/penalize abuse of market power in
the restructured electricity industry. In appropriate cases, the ERC is authorized to issue cease and desist order after due notice and hearing. Towards this end, it shall be responsible
for the following key functions in the restructured industry:

(a) Enforce the implementing rules and regulations of this Act;

(b) Within six (6) months from the effectivity of this Act, promulgate and enforce, in accordance with law, a National Grid Code and a Distribution Code which shall include, but
not limited to, the following:

(i) Performance standards for TRANSCO O & M Concessionaire, distribution utilities and suppliers: Provided, That in the establishment of the performance standards,
the nature and function of the entities shall be considered; and

(ii) Financial capability standards for the generating companies, the TRANSCO, distribution utilities and suppliers: Provided, That in the formulation of the financial
capability standards, the nature and function of the entity shall be considered: Provided, further, That such standards are set to ensure that the electric power industry
participants meet the minimum financial standards to protect the public interest. Determine, fix, and approve, after due notice and public hearings the universal charge, to
be imposed on all electricity end-users pursuant to Section 34 hereof;

(c) Enforce the rules and regulations governing the operations of the electricity spot market and the activities of the spot market operator and other participants in the spot market,
for the purpose of ensuring a greater supply and rational pricing of electricity;

(d) Determine the level of cross subsidies in the existing retail rate until the same is removed pursuant to Section 73 hereof;

(e) Amend or revoke, after due notice and hearing, the authority to operate of any person or entity which fails to comply with the provisions hereof, the IRR or any order or
resolution of the ERC. In the event a divestment is required, the ERC shall allow the affected party sufficient time to remedy the infraction or for an orderly disposal, but shall in
no case exceed twelve (12) months from the issuance of the order;

(f) In the public interest, establish and enforce a methodology for setting transmission and distribution wheeling rates and retail rates for the captive market of a distribution utility,
taking into account all relevant considerations, including the efficiency or inefficiency of the regulated entities. The rates must be such as to allow the recovery of just and
reasonable costs and a reasonable return on rate base (RORB) to enable the entity to operate viably. The ERC may adopt alternative forms of internationally-accepted rate setting
methodology as it may deem appropriate. The rate-setting methodology so adopted and applied must ensure a reasonable price of electricity. The rates prescribed shall be non-
discriminatory. To achieve this objective and to ensure the complete removal of cross subsidies, the cap on the recoverable rate of system losses prescribed in Section 10 of
Republic Act No. 7832, is hereby amended and shall be replaced by caps which shall be determined by the ERC based on load density, sales mix, cost of service, delivery voltage
and other technical considerations it may promulgate. The ERC shall determine such form of rate-setting methodology, which shall promote efficiency. In case the rate setting
methodology used is RORB, it shall be subject to the following guidelines:

(i) For purposes of determining the rate base, the TRANSCO or any distribution utility may be allowed to revalue its eligible assets not more than once every three (3)
years by an independent appraisal company: Provided, however, That ERC may give an exemption in case of unusual devaluation: Provided, further, That the ERC shall
exert efforts to minimize price shocks in order to protect the consumers;

(ii) Interest expenses are not allowable deductions from permissible return on rate base;

(iii) In determining eligible cost of services that will be passed on to the end-users, the ERC shall establish minimum efficiency performance standards for the
TRANSCO and distribution utilities including systems losses, interruption frequency rates, and collection efficiency;

(iv) Further, in determining rate base, the TRANSCO or any distribution utility shall not be allowed to include management inefficiencies like cost of project delays not
excused by force majeure, penalties and related interest during construction applicable to these unexcused delays; and
 (v) Any significant operating costs or project investments of TRANSCO and distribution utilities which shall become part of the rate base shall be subject to the
verification of the ERC to ensure that the contracting and procurement of the equipment, assets and services have been subjected to transparent and accepted industry
procurement and purchasing practices to protect the public interest.

(g) Three (3) years after the imposition of the universal charge, ensure that the charges of the TRANSCO or any distribution utility shall bear no cross subsidies between grids,
within grids, or between classes of customers, except as provided herein;

(h) Review and approve any changes on the terms and conditions of service of the TRANSCO or any distribution utility;

(i) Allow the TRANSCO to charge user fees for ancillary services to all electric power industry participants or self-generating entities connected to the grid. Such fees shall be
fixed by the ERC after due notice and public hearing;

(j) Set a lifeline rate for the marginalized end-users;

(k) Monitor and take measures in accordance with this Act to penalize abuse of market power, cartelization, and anti-competitive or discriminatory behavior by any electric power
industry participant;

(l) Impose fines or penalties for any non-compliance with or breach of this Act, the IRR of this Act and the rules and regulations which it promulgates or administers;

(m) Take any other action delegated to it pursuant to this Act;

(n) Before the end of April of each year, submit to the Office of the President of the Philippines and Congress, copy furnished the DOE, an annual report containing such matters or
cases which have been filed before or referred to it during the preceding year, the actions and proceedings undertaken and its decision or resolution in each case. The ERC shall
make copies of such reports available to any interested party upon payment of a charge which reflects the printing costs. The ERC shall publish all its decisions involving rates and
anticompetitive cases in at least one (1) newspaper of general circulation, and/or post electronically and circulate to all interested electric power industry participants copies of its
resolutions to ensure fair and impartial treatment;

(o) Monitor the activities of the generation and supply of the electric power industry with the end in view of promoting free market competition and ensuring that the allocation or
pass through of bulk purchase cost by distributors is transparent, non-discriminatory and that any existing subsidies shall be divided pro rata among all retail suppliers;

(p) Act on applications for or modifications of certificates of public convenience and/or necessity, licenses or permits of franchised electric utilities in accordance with law and
revoke, review and modify such certificates, licenses or permits in appropriate cases, such as in cases of violations of the Grid Code, Distribution Code and other rules and
regulations issued by the ERC in accordance with law;

(q) Act on applications for cost recovery and return on demand side management projects;

(r) In the exercise of its investigative and quasi-judicial powers, act against any participant or player in the energy sector for violations of any law, rule and regulation governing the
same, including the rules on cross ownership, anticompetitive practices, abuse of market positions and similar or related acts by any participant in the energy sector, or by any
person as may be provided by law, and require any person or entity to submit any report or data relative to any investigation or hearing conducted pursuant to this Act;
 (s) Inspect, on its own or through duly authorized representatives, the premises, books of accounts and records of any person or entity at any time, in the exercise of its quasi-
judicial power for purposes of determining the existence of any anticompetitive behavior and/or market power abuse and any violation of rules and regulations issued by the ERC;

(t) Perform such other regulatory functions as are appropriate and necessary in order to ensure the successful restructuring and modernization of the electric power industry, such
as, but not limited to, the rules and guidelines under which generation companies, distribution utilities which are not publicly listed shall offer and sell to the public a portion not
less than fifteen percent (15%) of their common shares of stocks: Provided, however, That generation companies, distribution utilities or their respective holding companies that
are already listed in the PSE are deemed in compliance. For existing companies, such public offering shall be implemented not later than five (5) years from the effectivity of this
Act. New companies shall implement their respective public offerings not later than five (5) years from the issuance of their certificate of compliance; and

(u) The ERC shall have the original and exclusive jurisdiction over all cases contesting rates, fees, fines and penalties imposed by the ERC in the exercise of the abovementioned
powers, functions and responsibilities and over all cases involving disputes between and among participants or players in the energy sector.

All notices of hearings to be conducted by the ERC for the purpose of fixing rates or fees shall be published at least twice for two successive weeks in two (2) newspapers of
nationwide circulation.

Aside from Section 43, additional functions of the ERC are scattered throughout RA 9136:

1. SEC. 6. Generation Sector. Generation of electric power, a business affected with public interest, shall be competitive and open.

Upon the effectivity of this Act, any new generation company shall, before it operates, secure from the Energy Regulatory Commission (ERC) a certificate of
compliance pursuant to the standards set forth in this Act, as well as health, safety and environmental clearances from the appropriate government agencies under
existing laws.

xxxx

2. SEC. 8. Creation of the National Transmission Company. x x x

That the subtransmission assets shall be operated and maintained by TRANSCO until their disposal to qualified distribution utilities which are in a position to take over
the responsibility for operating, maintaining, upgrading, and expanding said assets. x x x

In case of disagreement in valuation, procedures, ownership participation and other issues, the ERC shall resolve such issues.

xxxx

3. SEC. 23. Functions of Distribution Utilities. x x x

Distribution utilities shall submit to the ERC a statement of their compliance with the technical specifications prescribed in the Distribution Code and the performance
standards prescribed in the IRR of this Act. Distribution utilities which do not comply with any of the prescribed technical specifications and performance standards shall
submit to the ERC a plan to comply, within three (3) years, with said prescribed technical specifications and performance standards. The ERC shall, within sixty (60)
days upon receipt of such plan, evaluate the same and notify the distribution utility concerned of its action. Failure to submit a feasible and credible plan and/or failure to
implement the same shall serve as grounds for the imposition of appropriate sanctions, fines or penalties.

xxxx
4. SEC. 28. De-monopolization and Shareholding Dispersal. In compliance with the constitutional mandate for dispersal of ownership and de-monopolization of public
utilities, the holdings of persons, natural or juridical, including directors, officers, stockholders and related interests, in a distribution utility and their respective holding
companies shall not exceed twenty-five (25%) percent of the voting shares of stock unless the utility or the company holding the shares or its controlling stockholders are
already listed in the Philippine Stock Exchange (PSE): Provided, That controlling stockholders of small distribution utilities are hereby required to list in the PSE within
five (5) years from the enactment of this Act if they already own the stocks. New controlling stockholders shall undertake such listing within five (5) years from the time
they acquire ownership and control. A small distribution company is one whose peak demand is equal to Ten megawatts (10MW).

The ERC shall, within sixty (60) days from the effectivity of this Act, promulgate the rules and regulations to implement and effect this provision.

xxxx

5. SEC. 29. Supply Sector. x x x all suppliers of electricity to the contestable market shall require a license from the ERC.

For this purpose, the ERC shall promulgate rules and regulations prescribing the qualifications of electricity suppliers which shall include, among other requirements, a
demonstration of their technical capability, financial capability, and creditworthiness: Provided, That the ERC shall have authority to require electricity suppliers to
furnish a bond or other evidence of the ability of a supplier to withstand market disturbances or other events that may increase the cost of providing service.

xxxx

6. SEC. 30. Wholesale Electricity Spot Market. x x x

Subject to the compliance with the membership criteria, all generating companies, distribution utilities, suppliers, bulk consumers/end-users and other similar entities
authorized by the ERC shall be eligible to become members of the wholesale electricity spot market.

The ERC may authorize other similar entities to become eligible as members, either directly or indirectly, of the wholesale electricity spot market.

xxxx

7. SEC. 31. Retail Competition and Open Access. x x x

Upon the initial implementation of open access, the ERC shall allow all electricity end-users with a monthly average peak demand of at least one megawatt (1MW) for
the preceding twelve (12) months to be the contestable market. xxx Subsequently and every year thereafter, the ERC shall evaluate the performance of the market. x x x

8. SEC. 32. NPC Stranded Debt and Contract Cost Recovery. x x x

The ERC shall verify the reasonable amounts and determine the manner and duration for the full recovery of stranded debt and stranded contract costs as defined herein
xxxx

9. SEC. 34. Universal Charge. Within one (1) year from the effectivity of this Act, a universal charge to be determined, fixed and approved by the ERC, shall be
imposed on all electricity end-users x x x x

10. SEC. 35. Royalties, Returns and Tax Rates for Indigenous Energy Resources. x x x

To ensure lower rates for end-users, the ERC shall forthwith reduce the rates of power from all indigenous sources of energy.
11. SEC. 36. Unbundling of Rates and Functions. x x x

each distribution utility shall file its revised rates for the approval by the ERC. x x x x

12. SEC. 40. Enhancement of Technical Competence. The ERC shall establish rigorous training programs for its staff for the purpose of enhancing the technical
competence of the ERC in the following areas: evaluation of technical performance and monitoring of compliance with service and performance standards, performance-
based rate-setting reform, environmental standards and such other areas as will enable the ERC to adequately perform its duties and functions.

13. SEC. 41. Promotion of Consumer Interests. The ERC shall handle consumer complaints and ensure the adequate promotion of consumer interests.

14. SEC. 45. Cross Ownership, Market Power Abuse and Anti-Competitive Behavior. No participant in the electricity industry may engage in any anti-competitive
behavior including, but not limited to, cross-subsidization, price or market manipulation, or other unfair trade practices detrimental to the encouragement and protection
of contestable markets.

xxxx

(c) x x x The ERC shall, within one (1) year from the effectivity of this Act, promulgate rules and regulations to promote competition, encourage market development
and customer choice and discourage/penalize abuse of market power, cartelization and any anticompetitive or discriminatory behavior, in order to further the intent of
this Act and protect the public interest. Such rules and regulations shall define the following:

(a) the relevant markets for purposes of establishing abuse or misuse of monopoly or market position;

(b) areas of isolated grids; and

(c) the periodic reportorial requirements of electric power industry participants as may be necessary to enforce the provisions of this Section.

The ERC shall, motu proprio, monitor and penalize any market power abuse or anticompetitive or discriminatory act or behavior by any participant in the electric power
industry.

15. SEC. 51. Powers. The PSALM Corp. shall, in the performance of its functions and for the attainment of its objective, have the following powers: x x x

(e) To liquidate the NPC stranded contract costs utilizing proceeds from sales and other property contributed to it, including the proceeds from the universal charge;

xxxx

16. SEC. 60. Debts of Electric Cooperatives. x x x The ERC shall ensure a reduction in the rates of electric cooperatives commensurate with the resulting savings due to
the removal of the amortization payments of their loans. x x x x

17. SEC. 62. Joint Congressional Power Commission. x x x

x x x the Power Commission is hereby empowered to require the DOE, ERC, NEA, TRANSCO, generation companies, distribution utilities, suppliers and other electric
power industry participants to submit reports and all pertinent data and information relating to the performance of their respective functions in the industry. xxx

xxxx
 18. SEC. 65. Environmental Protection. Participants in the generation, distribution and transmission sub-sectors of the industry shall comply with all environmental laws,
rules, regulations and standards promulgated by the Department of Environment and Natural Resources including, in appropriate cases, the establishment of an
environmental guarantee fund.

19. SEC. 67. NPC Offer of Transition Supply Contracts. Within six (6) months from the effectivity of this Act, NPC shall file with the ERC for its approval a transition
supply contract duly negotiated with the distribution utilities containing the terms and conditions of supply and a corresponding schedule of rates, consistent with the
provisions hereof, including adjustments and/or indexation formulas which shall apply to the term of such contracts.

xxxx

20. SEC. 69. Renegotiation of Power Purchase and Energy Conversion Agreements between Government Entities. Within three (3) months from the effectivity of this Act,
all power purchase and energy conversion agreements between the PNOC-Energy Development Corporation (PNOC-EDC) and NPC, including but not limited to
the Palimpinon, Tongonan and Mt. Apo Geothermal complexes, shall be reviewed by the ERC and the terms thereof amended to remove any hidden costs or
extraordinary mark-ups in the cost of power or steam above their true costs. All amended contracts shall be submitted to the Joint Congressional Power Commission for
approval. The ERC shall ensure that all savings realized from the reduction of said mark-ups shall be passed on to all end-users.

After comparing the functions of the ERB and the ERC, we find that the ERC indeed assumed the functions of the ERB. However, the overlap in the functions of the ERB and of the ERC does not

mean that there is no valid abolition of the ERB. The ERC has new and expanded functions which are intended to meet the specific needs of a deregulated power industry. Indeed, National Land

Titles and Deeds Registration Administration v. Civil Service Commission stated that:

[I]f the newly created office has substantially new, different or additional functions, duties or powers, so that it may be said in fact to create an office different from the one
abolished, even though it embraces all or some of the duties of the old office it will be considered as an abolition of one office and the creation of a new or different one. The same
is true if one office is abolished and its duties, for reasons of economy are given to an existing officer or office. [13]

KERB argues that RA 9136 did not abolish the ERB nor did it alter its essential character as an economic regulator of the electric power industry. x x x RA 9136 rather changed merely ERBs name

and title to that of the ERC even as it expanded its functions and objectives to keep pace with the times. To uphold KERBs argument regarding the invalidity of the ERBs abolition is to ignore the

developments in the history of energy regulation.

The regulation of public services started way back in 1902 with the enactment of Act No. 520 which created the Coastwise Rate Commission. In 1906, Act No. 1507 was passed
creating the Supervising Railway Expert. The following year, Act No. 1779 was enacted creating the Board of Rate Regulation. Then, Act No 2307, which was patterned after the
Public Service Law of the State of New Jersey, was approved by the Philippine Commission in 1914, creating the Board of Public Utility Commissioners, composed of three
members, which absorbed all the functions of the Coastwise Rate Commission, the Supervising Railway Expert, and the Board of Rate Regulation.

Thereafter, several laws were enacted on public utility regulation. On November 7, 1936, Commonwealth Act No. 146, otherwise known as the Public Service Law, was enacted by
the National Assembly. The Public Service Commission (PSC) had jurisdiction, supervision, and control over all public services, including the electric power service.
 After almost four decades, significant developments in the energy sector changed the landscape of economic regulation in the country.

April 30, 1971 R.A. No. 6173 was passed creating the Oil Industry Commission (OIC), which was tasked to regulate the oil industry and to ensure the adequate
supply of petroleum products at reasonable prices.

September 24, 1972 then President Ferdinand E. Marcos issued Presidential Decree No. 1 which ordered the preparation of the Integrated Reorganization Plan by the
Commission on Reorganization. The Plan abolished the PSC and transferred the regulatory and adjudicatory functions pertaining to the electricity industry and water
resources to then Board of Power and Waterworks (BOPW).

October 6, 1977 the government created the Department of Energy (DOE) and consequently abolished the OIC, which was replaced by the creation of the Board of
Energy (BOE) through Presidential Decree No. 1206. The BOE, in addition, assumed the powers and functions of the BOPW over the electric power industry.

May 8, 1987 the BOE was reconstituted into the Energy Regulatory Board (ERB), pursuant to Executive Order No. 172 issued by then President Corazon
C. Aquino as part of her governments reorganization program. The rationale was to consolidate and entrust into a single body all the regulatory and adjudicatory
functions pertaining to the energy sector. Thus, the power to regulate the power rates and services of private electric utilities was transferred to the ERB.

December 28, 1992 Republic Act No. 7638 signed, where the power to fix the rates of the National Power Corporation (NPC) and the rural electric cooperatives
(RECs) was passed on to the ERB. Non-pricing functions of the ERB with respect to the petroleum industry were transferred to the DOE, i.e., regulating the capacities of
new refineries.

February 10, 1998 enactment of Republic Act 8479: Downstream Oil Industry Deregulation Act of 1998, which prescribed a five-month transition period, before full
deregulation of the oil industry, during which ERB would implement an automatic pricing mechanism (APM) for petroleum products every month.

June 12, 1998 the Philippine oil industry was fully deregulated, thus, ERBs focus of responsibility centered on the electric industry.

June 8, 2001 enactment of Republic Act No. 9136, otherwise known as the Electric Power Industry Reform Act (EPIRA) of 2001. The Act abolished the ERB and
created in its place the Energy Regulatory Commission (ERC) which is a purely independent regulatory body performing the combined quasi-judicial, quasi-legislative
and administrative functions in the electric industry.[14]

Throughout the years, the scope of the regulation has gradually narrowed from that of public services in 1902 to the electricity industry and water resources in 1972 to the electric power industry and

oil industry in 1977 to the electric industry alone in 1998. The ERC retains the ERBs traditional rate and service regulation functions. However, the ERC now also has to promote competitive

operations in the electricity market. RA 9136 expanded the ERCs concerns to encompass both the consumers and the utility investors.
Thus, the EPIRA provides a framework for the restructuring of the industry, including the privatization of the assets of the National Power Corporation (NPC), the transition to a
competitive structure, and the delineation of the roles of various government agencies and the private entities. The law ordains the division of the industry into four (4) distinct
sectors, namely: generation, transmission, distribution and supply. Corollarily, the NPC generating plants have to privatized and its transmission business spun off and privatized
thereafter.

In tandem with the restructuring of the industry is the establishment of a strong and purely independent regulatory body. Thus, the law created the ERC in place of the Energy
Regulatory Board (ERB).

To achieve its aforestated goal, the law has reconfigured the organization of the regulatory body. x x x[15]
There is no question in our minds that, because of the expansion of the ERCs functions and concerns, there was a valid abolition of the ERB. Thus, there is no merit to KERBsallegation that there is

an impairment of the security of tenure of the ERBs employees.

WHEREFORE, we DISMISS the petition. No costs.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 84301. April 7, 1993.

NATIONAL LAND TITLES AND DEEDS REGISTRATION ADMINISTRATION, petitioner,

vs.
CIVIL SERVICE COMMISSION and VIOLETA L. GARCIA, respondents.

The Solicitor General for petitioner.

Raul R. Estrella for private respondent.

SYLLABUS

1. ADMINISTRATIVE LAW; EXECUTIVE ORDER NO. 649; REORGANIZED LAND REGISTRATION COMMISSION TO NALTDRA; EXPRESSLY PROVIDED THE ABOLITION OF
EXISTING POSITIONS. Executive Order No. 649 authorized the reorganization of the Land Registration Commission (LRC) into the National Land Titles and Deeds Registration Administration
(NALTDRA). It abolished all the positions in the now defunct LRC and required new appointments to be issued to all employees of the NALTDRA. The question of whether or not a law abolishes an
office is one of legislative intent about which there can be no controversy whatsoever if there is an explicit declaration in the law itself. A closer examination of Executive Order No. 649 which
authorized the reorganization of the Land Registration Commission (LRC) into the National Land Titles and Deeds Registration Administration (NALTDRA), reveals that said law in express terms,
provided for the abolition of existing positions. Thus, without need of any interpretation, the law mandates that from the moment an implementing order is issued, all positions in the Land Registration
Commission are deemed non-existent. This, however, does not mean removal. Abolition of a position does not involve or mean removal for the reason that removal implies that the post subsists and
that one is merely separated therefrom. (Arao vs. Luspo, 20 SCRA 722 [1967]) After abolition, there is in law no occupant. Thus, there can be no tenure to speak of. It is in this sense that from the
standpoint of strict law, the question of any impairment of security of tenure does not arise. (De la Llana vs. Alba, 112 SCRA 294 [1982])
2. ID.; ID.; ID.; REORGANIZATION, VALID WHEN PURSUED IN GOOD FAITH; CASE AT BAR. 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. Two questions therefore arise: (1) was the abolition carried out by a legitimate body?; and (2) was it done in good faith? There is no
dispute over the authority to carry out a valid reorganization in any branch or agency of the Government. Under Section 9, Article XVII of the 1973 Constitution. The power to reorganize is, however;
not absolute. We have held in Dario vs. Mison that reorganizations in this jurisdiction have been regarded as valid provided they are pursued in good faith. This court has pronounced that if the newly
created office has substantially new, different or additional functions, duties or powers, so that it may be said in fact to create an office different from the one abolished, even though it embraces all or
some of the duties of the old office it will be considered as an abolition of one office and the creation of a new or different one. The same is true if one office is abolished and its duties, for reasons of
economy are given to an existing officer or office. Executive Order No. 649 was enacted to improve the services and better systematize the operation of the Land Registration Commission. A
reorganization is carried out in good faith if it is for the purpose of economy or to make bureaucracy more efficient. To this end, the requirement of Bar membership to qualify for key positions in the
NALTDRA was imposed to meet the changing circumstances and new development of the times. Private respondent Garcia who formerly held the position of Deputy Register of Deeds II did not have
such qualification. It is thus clear that she cannot hold any key position in the NALTDRA, The additional qualification was not intended to remove her from office. Rather, it was a criterion imposed
concomitant with a valid reorganization measure.

3. ID.; ID.; ID.; THERE IS NO VESTED PROPERTY RIGHT TO BE RE-EMPLOYED IN A REORGANIZED OFFICE; CASE AT BAR. There is no such thing as a vested interest or an estate in
an office, or even an absolute right to hold it. Except constitutional offices which provide for special immunity as regards salary and tenure, no one can be said to have any vested right in an office or
its salary. None of the exceptions to this rule are obtaining in this case. To reiterate, the position which private respondent Garcia would like to occupy anew was abolished pursuant to Executive Order
No. 649, a valid reorganization measure. There is no vested property right to be re employed in a reorganized office. Not being a member of the Bar, the minimum requirement to qualify under the
reorganization law for permanent appointment as Deputy Register of Deeds II, she cannot be reinstated to her former position without violating the express mandate of the law.

DECISION

CAMPOS, JR., J p:

The sole issue for our consideration in this case is whether or not membership in the bar, which is the qualification requirement prescribed for appointment to the position of Deputy Register of Deeds
under Section 4 of Executive Order No. 649 (Reorganizing the Land Registration Commission (LRC) into the National Land Titles and Deeds Registration Administration or NALTDRA) should be
required of and/or applied only to new applicants and not to those who were already in the service of the LRC as deputy register of deeds at the time of the issuance and implementation of the
abovesaid Executive Order.

The facts, as succinctly stated in the Resolution ** of the Civil Service Commission, are as follows:

"The records show that in 1977, petitioner Garcia, a Bachelor of Laws graduate and a first grade civil service eligible was appointed Deputy Register of Deeds VII under permanent status. Said
position was later reclassified to Deputy Register of Deeds III pursuant to PD 1529, to which position, petitioner was also appointed under permanent status up to September 1984. She was for two
years, more or less, designated as Acting Branch Register of Deeds of Meycauayan, Bulacan. By virtue of Executive Order No. 649 (which took effect on February 9, 1981) which authorized the
restructuring of the Land Registration Commission to National Land Titles and Deeds Registration Administration and regionalizing the Offices of the Registers therein, petitioner Garcia was issued
an appointment as Deputy Register of Deeds II on October 1, 1984, under temporary status, for not being a member of the Philippine Bar. She appealed to the Secretary of Justice but her request was
denied. Petitioner Garcia moved for reconsideration but her motion remained unacted. On October 23, 1984, petitioner Garcia was administratively charged with Conduct Prejudicial to the Best
Interest of the Service. While said case was pending decision, her temporary appointment as such was renewed in 1985. In a Memorandum dated October 30, 1986, the then Minister, now Secretary,
of Justice notified petitioner Garcia of the termination of her services as Deputy Register of Deeds II on the ground that she was "receiving bribe money". Said Memorandum of Termination which
took effect on February 9, 1987, was the subject of an appeal to the Inter-Agency Review Committee which in turn referred the appeal to the Merit Systems Protection Board (MSPB).

In its Order dated July 6, 1987, the MSPB dropped the appeal of petitioner Garcia on the ground that since the termination of her services was due to the expiration of her temporary appointment, her
separation is in order. Her motion for reconsideration was denied on similar ground." 1

However, in its Resolution 2 dated June 30, 1988, the Civil Service Commission directed that private respondent Garcia be restored to her position as Deputy Register of Deeds II or its equivalent in
the NALTDRA. It held that "under the vested right theory the new requirement of BAR membership to qualify for permanent appointment as Deputy Register of Deeds II or higher as mandated under
said Executive Order, would not apply to her (private respondent Garcia) but only to the filling up of vacant lawyer positions on or after February 9, 1981, the date said Executive Order took effect." 3
A fortiori, since private respondent Garcia had been holding the position of Deputy Register of Deeds II from 1977 to September 1984, she should not be affected by the operation on February 1, 1981
of Executive Order No. 649.
Petitioner NALTDRA filed the present petition to assail the validity of the above Resolution of the Civil Service Commission. It contends that Sections 8 and 10 of Executive Order No. 649 abolished
all existing positions in the LRC and transferred their functions to the appropriate new offices created by said Executive Order, which newly created offices required the issuance of new appointments
to qualified office holders. Verily, Executive Order No. 649 applies to private respondent Garcia, and not being a member of the Bar, she cannot be reinstated to her former position as Deputy Register
of Deeds II.

We find merit in the petition.

Executive Order No. 649 authorized the reorganization of the Land Registration Commission (LRC) into the National Land Titles and Deeds Registration Administration (NALTDRA). It abolished all
the positions in the now defunct LRC and required new appointments to be issued to all employees of the NALTDRA.

The question of whether or not a law abolishes an office is one of legislative intent about which there can be no controversy whatsoever if there is an explicit declaration in the law itself. 4 A closer
examination of Executive Order No. 649 which authorized the reorganization of the Land Registration Commission (LRC) into the National Land Titles and Deeds Registration Administration
(NALTDRA), reveals that said law in express terms, provided for the abolition of existing positions, to wit:

Sec. 8. Abolition of Existing Positions in the Land Registration Commission . . .

All structural units in the Land Registration Commission and in the registries of deeds, and all Positions therein shall cease to exist from the date specified in the implementing order to be issued by
the President pursuant to the preceding paragraph. Their pertinent functions, applicable appropriations, records, equipment and property shall be transferred to the appropriate staff or offices therein
created. (Emphasis Supplied.)

Thus, without need of any interpretation, the law mandates that from the moment an implementing order is issued, all positions in the Land Registration Commission are deemed non-existent. This,
however, does not mean removal. Abolition of a position does not involve or mean removal for the reason that removal implies that the post subsists and that one is merely separated therefrom. 5 After
abolition, there is in law no occupant. Thus, there can be no tenure to speak of. It is in this sense that from the standpoint of strict law, the question of any impairment of security of tenure does not
arise. 6

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. Two questions therefore arise: (1) was
the abolition carried out by a legitimate body?; and (2) was it done in good faith?

There is no dispute over the authority to carry out a valid reorganization in any branch or agency of the Government. Under Section 9, Article XVII of the 1973 Constitution, the applicable law at that
time:

Sec. 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 qualifications of their successors.

The power to reorganize is, however; not absolute. We have held in Dario vs. Mison 7 that reorganizations in this jurisdiction have been regarded as valid provided they are pursued in good faith. This
court has pronounced 8 that if the newly created office has substantially new, different or additional functions, duties or powers, so that it may be said in fact to create an office different from the one
abolished, even though it embraces all or some of the duties of the old office it will be considered as an abolition of one office and the creation of a new or different one. The same is true if one office
is abolished and its duties, for reasons of economy are given to an existing officer or office.

Executive Order No. 649 was enacted to improve the services and better systematize the operation of the Land Registration Commission. 9 A reorganization is carried out in good faith if it is for the
purpose of economy or to make bureaucracy more efficient. 10 To this end, the requirement of Bar membership to qualify for key positions in the NALTDRA was imposed to meet the changing
circumstances and new development of the times. 11 Private respondent Garcia who formerly held the position of Deputy Register of Deeds II did not have such qualification. It is thus clear that she
cannot hold any key position in the NALTDRA, The additional qualification was not intended to remove her from office. Rather, it was a criterion imposed concomitant with a valid reorganization
measure.
A final word, on the "vested right theory" advanced by respondent Civil Service Commission. There is no such thing as a vested interest or an estate in an office, or even an absolute right to hold it.
Except constitutional offices which provide for special immunity as regards salary and tenure, no one can be said to have any vested right in an office or its salary. 12 None of the exceptions to this
rule are obtaining in this case.

To reiterate, the position which private respondent Garcia would like to occupy anew was abolished pursuant to Executive Order No. 649, a valid reorganization measure. There is no vested property
right to be re employed in a reorganized office. Not being a member of the Bar, the minimum requirement to qualify under the reorganization law for permanent appointment as Deputy Register of
Deeds II, she cannot be reinstated to her former position without violating the express mandate of the law.

WHEREFORE, premises considered, We hereby GRANT the petition and SET ASIDE the questioned Resolution of the Civil Service Commission reinstating private respondent to her former position
as Deputy Register of Deeds II or its equivalent in the National Land Titles and Deeds Registration Administration.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 115863 March 31, 1995

AIDA D. EUGENIO, petitioner,

vs.
CIVIL SERVICE COMMISSION, HON. TEOFISTO T. GUINGONA, JR. & HON. SALVADOR ENRIQUEZ, JR.,respondents.

PUNO, J.:

The power of the Civil Service Commission to abolish the Career Executive Service Board is challenged in this petition for certiorari and prohibition.

First the facts. Petitioner is the Deputy Director of the Philippine Nuclear Research Institute. She applied for a Career Executive Service (CES) Eligibility and a CESO rank on August 2, 1993, she was
given a CES eligibility. On September 15, 1993, she was recommended to the President for a CESO rank by the Career Executive Service Board. 1

All was not to turn well for petitioner. On October 1, 1993, respondent Civil Service Commission 2 passed Resolution No. 93-4359, viz:

RESOLUTION NO. 93-4359

WHEREAS, Section 1(1) of Article IX-B provides that Civil Service shall be administered by the Civil Service Commission, . . .;
 WHEREAS, Section 3, Article IX-B of the 1987 Philippine Constitution provides that "The Civil Service Commission, as the central personnel agency of the government, is
mandated to establish a career service and adopt measures to promote morale, efficiency, integrity, responsiveness, progresiveness and courtesy in the civil service, . . .";

WHEREAS, Section 12 (1), Title I, Subtitle A, Book V of the Administrative Code of 1987 grants the Commission the power, among others, to administer and enforce the
constitutional and statutory provisions on the merit system for all levels and ranks in the Civil Service;

WHEREAS, Section 7, Title I, Subtitle A, Book V of the Administrative Code of 1987 Provides, among others, that The Career Service shall be characterized by (1) entrance based
on merit and fitness to be determined as far as practicable by competitive examination, or based highly technical qualifications; (2) opportunity for advancement to higher career
positions; and (3) security of tenure;

WHEREAS, Section 8 (c), Title I, Subtitle A, Book V of the administrative Code of 1987 provides that "The third level shall cover Positions in the Career Executive Service";

WHEREAS, the Commission recognizes the imperative need to consolidate, integrate and unify the administration of all levels of positions in the career service.

WHEREAS, the provisions of Section 17, Title I, Subtitle A. Book V of the Administrative Code of 1987 confers on the Commission the power and authority to effect changes in
its organization as the need arises.

WHEREAS, Section 5, Article IX-A of the Constitution provides that the Civil Service Commission shall enjoy fiscal autonomy and the necessary implications thereof;

NOW THEREFORE, foregoing premises considered, the Civil Service Commission hereby resolves to streamline reorganize and effect changes in its organizational structure.
Pursuant thereto, the Career Executive Service Board, shall now be known as the Office for Career Executive Service of the Civil Service Commission. Accordingly, the existing
personnel, budget, properties and equipment of the Career Executive Service Board shall now form part of the Office for Career Executive Service.

The above resolution became an impediment. to the appointment of petitioner as Civil Service Officer, Rank IV. In a letter to petitioner, dated June 7, 1994, the Honorable Antonio T. Carpio, Chief
Presidential legal Counsel, stated:

xxx xxx xxx

On 1 October 1993 the Civil Service Commission issued CSC Resolution No. 93-4359 which abolished the Career Executive Service Board.

Several legal issues have arisen as a result of the issuance of CSC Resolution No. 93-4359, including whether the Civil Service Commission has authority to abolish the Career
Executive Service Board. Because these issues remain unresolved, the Office of the President has refrained from considering appointments of career service eligibles to career
executive ranks.

xxx xxx xxx

You may, however, bring a case before the appropriate court to settle the legal issues arising from issuance by the Civil Service Commission of CSC Resolution No. 93-4359, for
guidance of all concerned.

Thank You.
Finding herself bereft of further administrative relief as the Career Executive Service Board which recommended her CESO Rank IV has been abolished, petitioner filed the petition at bench to annul,
among others, resolution No. 93-4359. The petition is anchored on the following arguments:

A.

IN VIOLATION OF THE CONSTITUTION, RESPONDENT COMMISSION USURPED THE LEGISLATIVE FUNCTIONS OF CONGRESS WHEN IT ABOLISHED THE
CESB, AN OFFICE CREATED BY LAW, THROUGH THE ISSUANCE OF CSC: RESOLUTION NO. 93-4359;

B.

ALSO IN VIOLATION OF THE CONSTITUTION, RESPONDENT CSC USURPED THE LEGISLATIVE FUNCTIONS OF CONGRESS WHEN IT ILLEGALLY
AUTHORIZED THE TRANSFER OF PUBLIC MONEY, THROUGH THE ISSUANCE OF CSC RESOLUTION NO. 93-4359.

Required to file its Comment, the Solicitor General agreed with the contentions of petitioner. Respondent Commission, however, chose to defend its ground. It posited the following position:

ARGUMENTS FOR PUBLIC RESPONDENT-CSC

I. THE INSTANT PETITION STATES NO CAUSE OF ACTION AGAINST THE PUBLIC RESPONDENT-CSC.

II. THE RECOMMENDATION SUBMITTED TO THE PRESIDENT FOR APPOINTMENT TO A CESO RANK OF PETITIONER EUGENIO WAS A VALID ACT OF THE
CAREER EXECUTIVE SERVICE BOARD OF THE CIVIL SERVICE COMMISSION AND IT DOES NOT HAVE ANY DEFECT.

III. THE OFFICE OF THE PRESIDENT IS ESTOPPED FROM QUESTIONING THE VALIDITY OF THE RECOMMENDATION OF THE CESB IN FAVOR OF
PETITIONER EUGENIO SINCE THE PRESIDENT HAS PREVIOUSLY APPOINTED TO CESO RANK FOUR (4) OFFICIALS SIMILARLY SITUATED AS SAID
PETITIONER. FURTHERMORE, LACK OF MEMBERS TO CONSTITUTE A QUORUM. ASSUMING THERE WAS NO QUORUM, IS NOT THE FAULT OF PUBLIC
RESPONDENT CIVIL SERVICE COMMISSION BUT OF THE PRESIDENT WHO HAS THE POWER TO APPOINT THE OTHER MEMBERS OF THE CESB.

IV. THE INTEGRATION OF THE CESB INTO THE COMMISSION IS AUTHORIZED BY LAW (Sec. 12 (1), Title I, Subtitle A, Book V of the Administrative Code of the
1987). THIS PARTICULAR ISSUE HAD ALREADY BEEN SETTLED WHEN THE HONORABLE COURT DISMISSED THE PETITION FILED BY THE HONORABLE
MEMBERS OF THE HOUSE OF REPRESENTATIVES, NAMELY: SIMEON A. DATUMANONG, FELICIANO R. BELMONTE, JR., RENATO V. DIAZ, AND MANUEL M.
GARCIA IN G.R. NO. 114380. THE AFOREMENTIONED PETITIONERS ALSO QUESTIONED THE INTEGRATION OF THE CESB WITH THE COMMISSION.

We find merit in the petition. 3

The controlling fact is that the Career Executive Service Board (CESB) was created in the Presidential Decree (P.D.) No. 1 on September 1, 1974 4 which adopted the Integrated Plan. Article IV,
Chapter I, Part of the III of the said Plan provides:

Article IV Career Executive Service

1. A Career Executive Service is created to form a continuing pool of well-selected and development oriented career administrators who shall provide competent and faithful
service.
 2. A Career Executive Service hereinafter referred to in this Chapter as the Board, is created to serve as the governing body of the Career Executive Service. The Board shall
consist of the Chairman of the Civil Service Commission as presiding officer, the Executive Secretary and the Commissioner of the Budget as ex-officio members and two other
members from the private sector and/or the academic community who are familiar with the principles and methods of personnel administration.

xxx xxx xxx

5. The Board shall promulgate rules, standards and procedures on the selection, classification, compensation and career development of members of the Career Executive Service.
The Board shall set up the organization and operation of the service. (Emphasis supplied)

It cannot be disputed, therefore, that as the CESB was created by law, it can only be abolished by the legislature. This follows an unbroken stream of rulings that the creation and abolition of public
offices is primarily a legislative function. As aptly summed up in AM JUR 2d on Public Officers and
Employees, 5 viz:

Except for such offices as are created by the Constitution, the creation of public offices is primarily a legislative function. In so far as the legislative power in this respect is not
restricted by constitutional provisions, it supreme, and the legislature may decide for itself what offices are suitable, necessary, or convenient. When in the exigencies of
government it is necessary to create and define duties, the legislative department has the discretion to determine whether additional offices shall be created, or whether these duties
shall be attached to and become ex-officio duties of existing offices. An office created by the legislature is wholly within the power of that body, and it may prescribe the mode of
filling the office and the powers and duties of the incumbent, and if it sees fit, abolish the office.

In the petition at bench, the legislature has not enacted any law authorizing the abolition of the CESB. On the contrary, in all the General Appropriations Acts from 1975 to 1993, the legislature has set
aside funds for the operation of CESB. Respondent Commission, however, invokes Section 17, Chapter 3, Subtitle A. Title I, Book V of the Administrative Code of 1987 as the source of its power to
abolish the CESB. Section 17 provides:

Sec. 17. Organizational Structure. Each office of the Commission shall be headed by a Director with at least one Assistant Director, and may have such divisions as are
necessary independent constitutional body, the Commission may effect changes in the organization as the need arises.

But as well pointed out by petitioner and the Solicitor General, Section 17 must be read together with Section 16 of the said Code which enumerates the offices under the respondent Commission, viz:

Sec. 16. Offices in the Commission. The Commission shall have the following offices:

(1) The Office of the Executive Director headed by an Executive Director, with a Deputy Executive Director shall implement policies, standards, rules and regulations promulgated
by the Commission; coordinate the programs of the offices of the Commission and render periodic reports on their operations, and perform such other functions as may be assigned
by the Commission.

(2) The Merit System Protection Board composed of a Chairman and two (2) members shall have the following functions:

xxx xxx xxx

(3) The Office of Legal Affairs shall provide the Chairman with legal advice and assistance; render counselling services; undertake legal studies and researches; prepare opinions
and ruling in the interpretation and application of the Civil Service law, rules and regulations; prosecute violations of such law, rules and regulations; and represent the Commission
before any court or tribunal.
 (4) The Office of Planning and Management shall formulate development plans, programs and projects; undertake research and studies on the different aspects of public personnel
management; administer management improvement programs; and provide fiscal and budgetary services.

(5) The Central Administrative Office shall provide the Commission with personnel, financial, logistics and other basic support services.

(6) The Office of Central Personnel Records shall formulate and implement policies, standards, rules and regulations pertaining to personnel records maintenance, security, control
and disposal; provide storage and extension services; and provide and maintain library services.

(7) The Office of Position Classification and Compensation shall formulate and implement policies, standards, rules and regulations relative to the administration of position
classification and compensation.

(8) The Office of Recruitment, Examination and Placement shall provide leadership and assistance in developing and implementing the overall Commission programs relating to
recruitment, execution and placement, and formulate policies, standards, rules and regulations for the proper implementation of the Commission's examination and placement
programs.

(9) The Office of Career Systems and Standards shall provide leadership and assistance in the formulation and evaluation of personnel systems and standards relative to
performance appraisal, merit promotion, and employee incentive benefit and awards.

(10) The Office of Human Resource Development shall provide leadership and assistance in the development and retention of qualified and efficient work force in the Civil Service;
formulate standards for training and staff development; administer service-wide scholarship programs; develop training literature and materials; coordinate and integrate all
training activities and evaluate training programs.

(11) The Office of Personnel Inspection and Audit shall develop policies, standards, rules and regulations for the effective conduct or inspection and audit personnel and personnel
management programs and the exercise of delegated authority; provide technical and advisory services to Civil Service Regional Offices and government agencies in the
implementation of their personnel programs and evaluation systems.

(12) The Office of Personnel Relations shall provide leadership and assistance in the development and implementation of policies, standards, rules and regulations in the
accreditation of employee associations or organizations and in the adjustment and settlement of employee grievances and management of employee disputes.

(13) The Office of Corporate Affairs shall formulate and implement policies, standards, rules and regulations governing corporate officials and employees in the areas of
recruitment, examination, placement, career development, merit and awards systems, position classification and compensation, performing appraisal, employee welfare and
benefit, discipline and other aspects of personnel management on the basis of comparable industry practices.

(14) The Office of Retirement Administration shall be responsible for the enforcement of the constitutional and statutory provisions, relative to retirement and the regulation for the
effective implementation of the retirement of government officials and employees.

(15) The Regional and Field Offices. The Commission shall have not less than thirteen (13) Regional offices each to be headed by a Director, and such field offices as may be
needed, each to be headed by an official with at least the rank of an Assistant Director.

As read together, the inescapable conclusion is that respondent Commission's power to reorganize is limited to offices under its control as enumerated in Section 16, supra. From its
inception, the CESB was intended to be an autonomous entity, albeit administratively attached to respondent Commission. As conceptualized by the Reorganization Committee "the CESB
shall be autonomous. It is expected to view the problem of building up executive manpower in the government with a broad and positive outlook." 6 The essential autonomous character of
the CESB is not negated by its attachment to respondent Commission. By said attachment, CESB was not made to fall within the control of respondent Commission. Under the
 Administrative Code of 1987, the purpose of attaching one functionally inter-related government agency to another is to attain "policy and program coordination." This is clearly etched out
in Section 38(3), Chapter 7, Book IV of the aforecited Code, to wit:

(3) Attachment. (a) This refers to the lateral relationship between the department or its equivalent and attached agency or corporation for purposes of policy and program
coordination. The coordination may be accomplished by having the department represented in the governing board of the attached agency or corporation, either as chairman or as a
member, with or without voting rights, if this is permitted by the charter; having the attached corporation or agency comply with a system of periodic reporting which shall reflect
the progress of programs and projects; and having the department or its equivalent provide general policies through its representative in the board, which shall serve as the
framework for the internal policies of the attached corporation or agency.

Respondent Commission also relies on the case of Datumanong, et al., vs. Civil Service Commission, G. R. No. 114380 where the petition assailing the abolition of the CESB was dismissed for lack of
cause of action. Suffice to state that the reliance is misplaced considering that the cited case was dismissed for lack of standing of the petitioner, hence, the lack of cause of action.

IN VIEW WHEREOF, the petition is granted and Resolution No. 93-4359 of the respondent Commission is hereby annulled and set aside. No costs.

SO ORDERED.