(wala hacienda vs PARC COMELEC vs Cruz Vinuya vs

Romulo)

would send a wrong signal that an act may be justified when based on an
unconstitutional provision of law.

(the rest of my assigned cases iz already in le notes. Haha. Mao nalang

ang wala sa notes)

The Court had the following disquisition on the concept of the

Operative Fact Doctrine in the case of Chavez v. National Housing
Authority:[173]

COCOFED vs Republic
Facts: (kayo na guys, di ko magets ang facts pero sure ko sa held)
Held:
The Operative Fact Doctrine
does not apply
Petitioners assert that the Sandiganbayans refusal to recognize the vested
rights purportedly created under the coconut levy laws constitutes taking of
private property without due process of law. They reason out that to accord
retroactive application to a declaration of unconstitutionality would be
unfair inasmuch as such approach would penalize the farmers who merely
obeyed then valid laws.
This contention is specious.
In Yap v. Thenamaris Ships Management,[170] the Operative Fact
Doctrine was discussed in that:
As a general rule, an unconstitutional act is not a
law. The doctrine of operative fact serves as an exception
to the aforementioned general rule. In Planters Products,
Inc. v. Fertiphil Corporation, we held:
The doctrine of operative fact, as an exception to the general rule, only
applies as a matter of equity and fair play. It nullifies the effects of an
unconstitutional law by recognizing that the existence of a statute prior to a
determination of unconstitutionality is an operative fact and may have
consequences which cannot always be ignored. The past cannot always be
erased by a new judicial declaration.
In that case, this Court further held that the Operative Fact Doctrine will not
be applied as an exception when to rule otherwise would be iniquitous and

The operative fact doctrine is embodied in De Agbayani v. Court of

Appeals, wherein it is stated that a legislative or executive act, prior to its
being declared as unconstitutional by the courts, is valid and must be
complied with.
In the case at bar, the Court rules that the dictates of justice, fairness and
equity do not support the claim of the alleged farmer-owners that their
ownership of the UCPB shares should be respected. Our reasons:
1.

Said farmers or alleged claimants do not have any legal right to

own the UCPB shares distributed to them. It was not successfully
refuted that said claimants were issued receipts under R.A. 6260
for the payment of the levy that went into the Coconut Investment
Fund (CIF) upon which shares in the Coconut Investment
Company will be issued. The Court upholds the finding of the
Sandiganbayan that said investment company is a different
corporate entity from the United Coconut Planters Bank. This was
in fact admitted by petitioners during the April 17, 2001 oral
arguments in G.R. Nos. 147062-64.
2. To grant all the UCPB shares to petitioners and its alleged
members would be iniquitous and prejudicial to the remaining 4.6
million farmers who have not received any UCPB shares when in
fact they also made payments to either the CIF or the CCSF but did
not receive any receipt or who was not able to register their
receipts or misplaced them.
3. The Sandiganbayan made the finding that due to enormous
operational problems and administrative complications, the
intended beneficiaries of the UCPB shares were not able to receive
the shares due to them.
4. The Court also takes judicial cognizance of the fact that a number, if
not all, of the coconut farmers who sold copra did not get the receipts
for the payment of the coconut levy for the reason that the copra they
produced were bought by traders or middlemen who in turn sold the
same to the coconut mills. The reality on the ground is that it was these

traders who got the receipts and the corresponding UCPB shares. In
addition, some uninformed coconut farmers who actually got the
COCOFUND receipts, not appreciating the importance and value of
said receipts, have already sold said receipts to non-coconut farmers,
thereby depriving them of the benefits under the coconut levy
laws. Ergo, the coconut farmers are the ones who will not be benefited
by the distribution of the UCPB shares contrary to the policy behind the
coconut levy laws. The nullification of the distribution of the UCPB
shares and their transfer to the government for the coconut industry
will, therefore, ensure that the benefits to be deprived from the UCPB
shares will actually accrue to the intended beneficiaries the genuine
coconut farmers.
From the foregoing, it is highly inappropriate to apply the
operative fact doctrine to the UCPB shares. Public funds, which
were supposedly given utmost safeguard, were haphazardly
distributed to private individuals based on statutory provisions that
are found to be constitutionally infirm on not only one but on a
variety of grounds. Worse still, the recipients of the UCPB shares
may not actually be the intended beneficiaries of said
benefit. Clearly, applying the Operative Fact Doctrine would not
only be iniquitous but would also serve injustice to the
Government, to the coconut industry, and to the people, who,
whether willingly or unwillingly, contributed to the public funds,
and therefore expect that their Government would take utmost care
of them and that they would be used no less, than for public
purpose.
CIR vs San Roque
Facts:
This Resolution resolves the Motion for Reconsideration and the
Supplemental Motion for Reconsideration filed by San Roque Power
Corporation (San Roque) in G.R. No. 187485, the Comment to the Motion
for Reconsideration filed by the Commissioner of Internal Revenue (CIR)
in G.R. No. 187485, the Motion for Reconsideration filed by the CIR in
G.R.No. 196113, and the Comment to the Motion for Reconsideration filed
by Taganito Mining Corporation (Taganito) in G.R. No. 196113.

San Roque prays that the rule established in our 12 February 2013 Decision
be given only a prospective effect, arguing that "the manner by which the
Bureau of Internal Revenue (BIR) and the Court of Tax Appeals(CTA)
actually treated the 120 + 30 day periods constitutes an operative fact the
effects and consequences of which cannot be erased or undone."1
The CIR, on the other hand, asserts that Taganito Mining Corporation's
(Taganito) judicial claim for tax credit or refund was prematurely filed
before the CTA and should be disallowed because BIR Ruling No. DA-48903 was issued by a Deputy Commissioner, not by the Commissioner of
Internal Revenue.
Held:
We deny both motions.
The Doctrine of Operative Fact
The general rule is that a void law or administrative act cannot be the source
of legal rights or duties. Article 7 of the Civil Code enunciates this general
rule, as well as its exception: "Laws are repealed only by subsequent ones,
and their violation or non-observance shall not be excused by disuse, or
custom or practice to the contrary. When the courts declared a law to be
inconsistent with the Constitution, the former shall be void and the latter
shall govern. Administrative or executive acts, orders and regulations shall
be valid only when they are not contrary to the laws or the Constitution."
The doctrine of operative fact is an exception to the general rule, such that a
judicial declaration of invalidity may not necessarily obliterate all the
effects and consequences of a void act prior to such declaration.
Such a view has support in logic and possesses the merit of simplicity. It
may not however be sufficiently realistic. It does not admit of doubt that
prior to the declaration of nullity such challenged legislative or executive
act must have been in force and had to be complied with. This is so as until
after the judiciary, in an appropriate case, declares its invalidity, it is entitled
to obedience and respect. Parties may have acted under it and may have
changed their positions. What could be more fitting than that in a
subsequent litigation regard be had to what has been done while such

legislative or executive act was in operation and presumed to be valid in all

respects. It is now accepted as a doctrine that prior to its being nullified, its
existence as a fact must be reckoned with. This is merely to reflect
awareness that precisely because the judiciary is the governmental organ
which has the final say on whether or not a legislative or executive measure
is valid, a period of time may have elapsed before it can exercise the power
of judicial review that may lead to a declaration of nullity. It would be to
deprive the law of its quality of fairness and justice then, if there be no
recognition of what had transpired prior to such adjudication.
Clearly, for the operative fact doctrine to apply, there must be a "legislative
or executive measure," meaning a law or executive issuance, that is
invalidated by the court. From the passage of such law or promulgation of
such executive issuance until its invalidation by the court, the effects of the
law or executive issuance, when relied upon by the public in good faith,
may have to be recognized as valid. In the present case, however, there is no
such law or executive issuance that has been invalidated by the Court
except BIR Ruling No. DA-489-03.
To justify the application of the doctrine of operative fact as an exemption,
San Roque asserts that "the BIR and the CTA in actual practice did not
observe and did not require refund seekers to comply with the120+30 day
periods."4This is glaring error because an administrative practice is neither a
law nor an executive issuance. Moreover, in the present case, there is even
no such administrative practice by the BIR as claimed by San Roque.
To repeat, a claim for tax refund or credit, like a claim for tax exemption, is
construed strictly against the taxpayer.1wphi1One of the conditions for a
judicial claim of refund or credit under the VAT System is compliance with
the 120+30 day mandatory and jurisdictional periods. Thus, strict
compliance with the 120+30 day periods is necessary for such a claim to
prosper, whether before, during, or after the effectivity of the Atlas doctrine,
except for the period from the issuance of BIR Ruling No. DA-489-03 on
10 December 2003 to 6 October 2010 when the Aichi doctrine was adopted,
which again reinstated the 120+30 day periods as mandatory and
jurisdictional.
San Roques argument must, therefore, fail. The doctrine of operative fact is
an argument for the application of equity and fair play. In the present case,

we applied the doctrine of operative fact when we recognized simultaneous

filing during the period between 10 December 2003, when BIR Ruling No.
DA-489-03 was issued, and 6 October 2010, when this Court promulgated
Aichi declaring the 120+30 day periods mandatory and jurisdictional, thus
reversing BIR Ruling No. DA-489-03.
The doctrine of operative fact is in fact incorporated in Section 246 of the
Tax Code.
Since the law has already prescribed in Section 246 of the Tax Code how
the doctrine of operative fact should be applied, there can be no invocation
of the doctrine of operative fact other than what the law has specifically
provided in Section 246. In the present case, the rule or ruling subject of the
operative fact doctrine is BIR Ruling No. DA-489-03 dated 10 December
2003. Prior to this date, there is no such rule or ruling calling for the
application of the operative fact doctrine in Section 246. Section246, being
an exemption to statutory taxation, must be applied strictly against the
taxpayer claiming such exemption.
Belgica vs Ochoa
Facts:
Before the Court are consolidated petitions, taken under Rule 65 of the
Rules of Court, all of which assailthe constitutionality of the Pork Barrel
System.Pork Barrell refers to an appropriation of government spending
meant for localized projects and securedsolely or primarily to bring money
to a representative's district.In the Philippines, the pork barrel hasbeen
commonly referred to as lump-sum, discretionary funds of Members of the
Legislature, although, itsusage would evolve in reference to certain funds
of the President such as the Malampaya Funds and thePresidential Social
Fund.The Malampaya Funds was a special fund created under PD 910
issued by then President Ferdinand E.Marcos for the development of indigenous
energy resources vital to economic growth.The Presidential Social Fund is sourced
from the share of the government in the aggregate grossearnings of
PAGCORthrough which the President provides direct assistance to
priority programs andprojects not funded under the regular budget.In 1996, an
anonymous source later identified as Former Marikina City Romeo
Candazo revealed thathuge sums of government money went into

the pockets of legislators as kickbacks.in 2004, several concerned citizens

sought
the
nullification
of
the
PDAF for
being
unconstitutional.Unfortunately, for lack of any pertinent evidentiary support
that illegal misuse of PDAF in the form of kickbacks has become a common
exercise of unscrupulous Members of Congress, the petition wasdismissed.In
July 2013, NBI began its probe into allegations that the government has
been defrauded of some P10Billion over the past 10 years by a syndicate
using funds from the pork barrel of lawmakers and variousgovernment
agencies for scores of ghost projects. The investigation was spawned by
sworn affidavits of six whistle-blowers who declared that JLN Corporation
(stands for Janet Lim Napoles) had facilitated theswindling of billions of
pesos from the public coffers for ghost projects using no fewer than 20
dummynon-government organizations for an entire decade.
In August 2013, the COA released report revealing substantial irregularities in the
disbursement and utilization of PDAF by the Congressmen during Arroyo administration.
As for the presidential pork barrel, whistleblowers allege that atleast 900m fromroyaties in the
operation of the malampaya gas project off Palawan province intended for agrarian reform
beneficiaries has gone into a dummy NGO.

Araullo vs Aquino III

Facts:
When President Benigno Aquino III took office, his administration noticed
the sluggish growth of the economy. The World Bank advised that the
economy needed a stimulus plan. Budget Secretary Florencio Butch Abad
then came up with a program called the Disbursement Acceleration
Program (DAP).
The DAP was seen as a remedy to speed up the funding of government
projects. DAP enables the Executive to realign funds from slow moving
projects to priority projects instead of waiting for next years appropriation.
So what happens under the DAP was that if a certain government project is
being undertaken slowly by a certain executive agency, the funds allotted
therefor will be withdrawn by the Executive. Once withdrawn, these funds
are declared as savings by the Executive and said funds will then be
reallotted to other priority projects. The DAP program did work to
stimulate the economy as economic growth was in fact reported and portion
of such growth was attributed to the DAP (as noted by the Supreme Court).

Spurred in large part by findings contained in the COA report and Napoles controversy,
several petitions were lodged before the Court similarly seeking that the Pork Barrel be
declared unconstitutional.

Other sources of the DAP include the unprogrammed funds from the
General Appropriations Act (GAA). Unprogrammed funds are standby
appropriations made by Congress in the GAA.

Held:

Meanwhile, in September 2013, Senator Jinggoy Estrada made an expos

claiming that he, and other Senators, received Php50M from the President
as an incentive for voting in favor of the impeachment of then Chief Justice
Renato Corona. Secretary Abad claimed that the money was taken from the
DAP but was disbursed upon the request of the Senators.

The Courts pronouncement anent the issue of unconstitutionality of (a) the

2013 PDAF Article and its Special Provisions, (b) all other Congressional
Pork Barrel provisions similar thereto, and (c) the phrases (1) and for such
other purposes as may be hereafter directed by the President: under section
12 of PD 910, and (2) to finance the priority infrastructure development
projects under Section 12 of PD 1869, as amended by PD 1993, must only
be treated as prospective in effect in view of the operative fact doctrine.
The operative fact doctrine exhorts the recognition that until the judiciary, in
an appropriate case, declares the invalidity of a certain legislative or
executive act, such act is presumed constitutional and thus, entitled to
obedience and respect and should be properly enforced and complied with.

This apparently opened a can of worms as it turns out that the DAP does not
only realign funds within the Executive. It turns out that some nonExecutive projects were also funded; to name a few: Php1.5B for the CPLA
(Cordillera Peoples Liberation Army), Php1.8B for the MNLF (Moro
National Liberation Front), P700M for the Quezon Province, P50-P100M
for certain Senators each, P10B for Relocation Projects, etc.
This prompted Maria Carolina Araullo, Chairperson of the Bagong
Alyansang Makabayan, and several other concerned citizens to file various
petitions with the Supreme Court questioning the validity of the DAP.
Among their contentions was:

DAP is unconstitutional because it violates the constitutional rule which

provides that no money shall be paid out of the Treasury except in
pursuance of an appropriation made by law.
Secretary Abad argued that the DAP is based on certain laws particularly
the GAA (savings and augmentation provisions thereof), Sec. 25(5), Art. VI
of the Constitution (power of the President to augment), Secs. 38 and 49 of
Executive Order 292 (power of the President to suspend expenditures and
authority to use savings, respectively).
Issue:
Whether or not the Doctrine of Operative Fact is applicable.
Held:
Yes. The Doctrine of Operative Fact, which recognizes the legal effects of
an act prior to it being declared as unconstitutional by the Supreme Court, is
applicable. The DAP has definitely helped stimulate the economy. It has
funded numerous projects. If the Executive is ordered to reverse all actions
under the DAP, then it may cause more harm than good. The DAP effects
can no longer be undone. The beneficiaries of the DAP cannot be asked to
return what they received especially so that they relied on the validity of the
DAP. However, the Doctrine of Operative Fact may not be applicable to the
authors, implementers, and proponents of the DAP if it is so found in the
appropriate tribunals (civil, criminal, or administrative) that they have not
acted in good faith.
Velarde v SJS (2004)
Facts:
Facts:
-On January 28, 2003, SJS filed a Petition for Declaratory Relief before
the RTC-Manila against Velarde and his co-respondents Eminence, Jaime
Cardinal Sin, Executive Minister Erao Manalo, Brother Eddie Villanueva
and Brother Eliseo F. Soriano.
-SJS, a registered political party, sought the interpretation of several
constitutional provisions, specifically on the separation of church and state;
and a declaratory judgment on the constitutionality of the acts of religious
leaders endorsing a candidate for an elective office, or urging or requiring
the members of their flock to vote for a specified candidate.

-The petitioner filed a Motion to dismiss before the trial court owing to
the fact that alleged that the questioned SJS Petition did not state a cause of
action and that there was no justiciable controversy.
-The trial courts junked the Velarde petitions under certain reasons:
1. It said that it had jurisdiction over the SJS petition, because in praying
for a determination as to whether the actions imputed to the respondents
were violative of Article II, Section 6 of the Fundamental Law, the petition
hasraised only a question of law.
2. It then proceeded to a lengthy discussion of the issue raised in the
Petition the separation of church and state even tracing, to some extent,
the historical background of the principle. Through its discourse, the court
quipped at some point that the "endorsement of specific candidates in an
election to any public office is a clear violation of the separation clause."
-The trial courts essay did not contain a statement of facts and a
dispositive portion, however. Due to this aberration, Velarde and Soriano
filed separate Motions for Reconsideration before the trial court owing to
these facts.
-The lower court denied these Motions. Hence, this petition for review.
On April 13, 2004, the Court en banc conducted an Oral Argument.14
-In his Petition, Brother Mike Velarde submits the following issues for
this Courts resolution:
1. Whether or not the Decision dated 12 June 2003 rendered by the court
a quo was proper and valid;
2. Whether or not there exists justiciable controversy in herein
respondents Petition for declaratory relief;
3. Whether or not herein respondent has legal interest in filing the Petition
for declaratory relief;
4. Whether or not the constitutional question sought to be resolved by
herein respondent is ripe for judicial determination;
5. Whether or not there is adequate remedy other than the declaratory
relief; and,
6. Whether or not the court a quo has jurisdiction over the Petition for
declaratory relief of herein respondent.
Issue:
Did the Petition for Declaratory Relief raise a justiciable controversy?
Held:
NO. A justiciable controversy to an existing case or controversy that is
appropriate or ripe for judicial determination, not one that is

conjectural or merely anticipatory. A petition filed with the trial court

should contain a plain, concise and direct statement of the ultimate facts
on which the party pleading relies for his claim.
The SJS Petition fell short of the requirements to constitutue a jusiciable
controversy. Why?
a. It stated no ultimate facts. The petition simply theorized that the
people elected who were endorsed by these religious leaders might become
beholden to the latter.
b.
It did not sufficiently state a declaration of its rights and
duties, what specific legal right of the petitioner wasviolated by the
respondents therein, and what particular act or acts of the latter were in
breach of its rights, the law or the constitution,
c.
The petition did not pray for a stoppage of violated rights
(duh, wala ngang rights na sinabi eh). It merely sought an opinion of the
trial court. However, courts are proscribed from rendering an advisory
opinion. (tantamount to making laws, remember the questionability of
justice panganibans guidelines for article 36 of the family code)
It must also be considered that even the religious leaders were puzzled as
to the breach of rights they were claimed to have committed. As pointed out
by Soriano, what exactly has he done that merited the attention of SJS?
Jaime Cardinal Sin adds that the election season had not even started at the
time SJS filed its Petition and that he has not been actively involved in
partisan politics. The Petition does not even allege any indication or
manifest intent on the part of any of the respondents below tochampion an
electoral candidate, or to urge their so-called flock to vote for, a particular
candidate. It is a time-honored rule that sheer speculation does not give rise
to an actionable right.