Abrigo, and Josefina R. Licuanan, was docketed as Civil Case No.
Q-93-14971 of the Regional Trial Court
FIRST DIVISION
[G.R. No. 171182. August 23, 2012.]
UNIVERSITY OF THE PHILIPPINES, JOSE V. ABUEVA, RAUL P. DE GUZMAN,
RUBEN P. ASPIRAS, EMMANUEL P. BELLO, WILFREDO P. DAVID, CASIANO
S. ABRIGO, and JOSEFINA R. LICUANAN, petitioners, vs. HON. AGUSTIN S.
DIZON, in his capacity as Presiding Judge of the Regional Trial Court of
Quezon City, Branch 80, STERN BUILDERS, INC., and SERVILLANO DELA
CRUZ, respondents.
DECISION
BERSAMIN, J p:
Trial judges should not immediately issue writs of execution or garnishment against the
Government or any of its subdivisions, agencies and instrumentalities to enforce money judgments. 1 They
should bear in mind that the primary jurisdiction to examine, audit and settle all claims of any sort due from
the Government or any of its subdivisions, agencies and instrumentalities pertains to the Commission on
Audit (COA) pursuant to Presidential Decree No. 1445 (Government Auditing Code of the Philippines).
The Case
On appeal by the University of the Philippines and its then incumbent officials (collectively, the
UP) is the decision promulgated on September 16, 2005, 2 whereby the Court of Appeals (CA) upheld the
order of the Regional Trial Court (RTC), Branch 80, in Quezon City that directed the garnishment of public
funds amounting to P16,370,191.74 belonging to the UP to satisfy the writ of execution issued to enforce
the already final and executory judgment against the UP.
Antecedents
On August 30, 1990, the UP, through its then President Jose V. Abueva, entered into a General
Construction Agreement with respondent Stern Builders Corporation (Stern Builders), represented by its
President and General Manager Servillano dela Cruz, for the construction of the extension building and the
renovation of the College of Arts and Sciences Building in the campus of the University of the Philippines in
Los Baños (UPLB). 3 IASTDE
In the course of the implementation of the contract, Stern Builders submitted three progress
billings corresponding to the work accomplished, but the UP paid only two of the billings. The third billing
worth P273,729.47 was not paid due to its disallowance by the Commission on Audit (COA). Despite the
lifting of the disallowance, the UP failed to pay the billing, prompting Stern Builders and dela Cruz to sue the
UP and its co-respondent officials to collect the unpaid billing and to recover various damages. The suit,
entitled Stern Builders Corporation and Servillano R. Dela Cruz v. University of the Philippines Systems,
Jose V. Abueva, Raul P. de Guzman, Ruben P. Aspiras, Emmanuel P. Bello, Wilfredo P. David, Casiano S.
in Quezon City (RTC). 4
After trial, on November 28, 2001, the RTC rendered its decision in favor of the plaintiffs, 5 viz.:
Wherefore, in the light of the foregoing, judgment is hereby rendered in
favor of the plaintiff and against the defendants ordering the latter to pay plaintiff,
jointly and severally, the following, to wit:
1. P503,462.74 amount of the third billing, additional
accomplished work and retention money
2. P5,716,729.00 in actual damages
3. P10,000,000.00 in moral damages
4. P150,000.00 and P1,500.00 per appearance as attorney's
fees; and
5. Costs of suit.
SO ORDERED.
Following the RTC's denial of its motion for reconsideration on May 7, 2002, 6 the UP filed a
notice of appeal on June 3, 2002. 7 Stern Builders and dela Cruz opposed the notice of appeal on the
ground of its filing being belated, and moved for the execution of the decision. The UP countered that the
notice of appeal was filed within the reglementary period because the UP's Office of Legal Affairs (OLS) in
Diliman, Quezon City received the order of denial only on May 31, 2002. On September 26, 2002, the RTC
denied due course to the notice of appeal for having been filed out of time and granted the private
respondents' motion for execution. 8 CDESIA
The RTC issued the writ of execution on October 4, 2002, 9 and the sheriff of the RTC served the
writ of execution and notice of demand upon the UP, through its counsel, on October 9, 2002. 10 The UP
filed an urgent motion to reconsider the order dated September 26, 2002, to quash the writ of execution
dated October 4, 2002, and to restrain the proceedings. 11 However, the RTC denied the urgent motion on
April 1, 2003. 12
On June 24, 2003, the UP assailed the denial of due course to its appeal through a petition
for certiorari in the Court of Appeals (CA), docketed as CA-G.R. No. 77395. 13
On February 24, 2004, the CA dismissed the petition for certiorari upon finding that the UP's
notice of appeal had been filed late, 14 stating:
Records clearly show that petitioners received a copy of the Decision
dated November 28, 2001 and January 7, 2002, thus, they had until January 22,
2002 within which to file their appeal. On January 16, 2002 or after the lapse of nine
(9) days, petitioners through their counsel Atty. Nolasco filed a Motion for
Reconsideration of the aforesaid decision, hence, pursuant to the rules, petitioners
still had six (6) remaining days to file their appeal. As admitted by the petitioners in
their petition (Rollo, p. 25), Atty. Nolasco received a copy of the Order denying their
motion for reconsideration on May 17, 2002, thus, petitioners still has until May 23,
2002 (the remaining six (6) days) within which to file their appeal. Obviously,
petitioners were not able to file their Notice of Appeal on May 23, 2002 as it was only
filed on June 3, 2002.
 In view of the said circumstances, We are of the belief and so holds that
the Notice of Appeal filed by the petitioners was really filed out of time, the same
having been filed seventeen (17) days late of the reglementary period. By reason of
which, the decision dated November 28, 2001 had already become final and
executory. "Settled is the rule that the perfection of an appeal in the manner and
within the period permitted by law is not only mandatory but jurisdictional, and
failure to perfect that appeal renders the challenged judgment final and executory.
This is not an empty procedural rule but is grounded on fundamental considerations
of public policy and sound practice." (Ram's Studio and Photographic Equipment,
Inc. vs. Court of Appeals, 346 SCRA 691, 696). Indeed, Atty. Nolasco received the
order of denial of the Motion for Reconsideration on May 17, 2002 but filed a Notice
of Appeal only on June 3, 3003. As such, the decision of the lower court ipso
facto became final when no appeal was perfected after the lapse of the
reglementary period. This procedural caveat cannot be trifled with, not even by the
High Court. 15 TDEASC
The UP sought a reconsideration, but the CA denied the UP's motion for reconsideration on April
19, 2004. 16
On May 11, 2004, the UP appealed to the Court by petition for review on certiorari (G.R. No.
163501).
On June 23, 2004, the Court denied the petition for review. 17 The UP moved for the
reconsideration of the denial of its petition for review on August 29, 2004, 18but the Court denied the
motion on October 6, 2004. 19 The denial became final and executory on November 12, 2004. 20
In the meanwhile that the UP was exhausting the available remedies to overturn the denial of due
course to the appeal and the issuance of the writ of execution, Stern Builders and dela Cruz filed in the RTC
their motions for execution despite their previous motion having already been granted and despite the writ
of execution having already issued. On June 11, 2003, the RTC granted another motion for execution filed
on May 9, 2003 (although the RTC had already issued the writ of execution on October 4, 2002). 21
On June 23, 2003 and July 25, 2003, respectively, the sheriff served notices of garnishment on
the UP's depository banks, namely: Land Bank of the Philippines (Buendia Branch) and the Development
Bank of the Philippines (DBP), Commonwealth Branch. 22 The UP assailed the garnishment through an
urgent motion to quash the notices of garnishment; 23 and a motion to quash the writ of execution dated
May 9, 2003. 24
On their part, Stern Builders and dela Cruz filed their ex parte motion for issuance of a release
order. 25
On October 14, 2003, the RTC denied the UP's urgent motion to quash, and granted Stern
Builders and dela Cruz's ex parte motion for issuance of a release order.26
The UP moved for the reconsideration of the order of October 14, 2003, but the RTC denied the
motion on November 7, 2003. 27
On January 12, 2004, Stern Builders and dela Cruz again sought the release of the garnished
funds. 28 Despite the UP's opposition, 29 the RTC granted the motion to release the garnished funds on
March 16, 2004. 30 On April 20, 2004, however, the RTC held in abeyance the enforcement of the writs of
execution issued on October 4, 2002 and June 3, 2003 and all the ensuing notices of garnishment, citing
Section 4, Rule 52, Rules of Court, which provided that the pendency of a timely motion for reconsideration
stayed the execution of the judgment. 31 cDCIHT
On December 21, 2004, the RTC, through respondent Judge Agustin S. Dizon, authorized the
release of the garnished funds of the UP, 32 to wit:
WHEREFORE, premises considered, there being no more legal
impediment for the release of the garnished amount in satisfaction of the judgment
award in the instant case, let the amount garnished be immediately released by the
Development Bank of the Philippines, Commonwealth Branch, Quezon City in favor
of the plaintiff.
SO ORDERED.
The UP was served on January 3, 2005 with the order of December 21, 2004 directing DBP to
release the garnished funds. 33
On January 6, 2005, Stern Builders and dela Cruz moved to cite DBP in direct contempt of court
for its non-compliance with the order of release. 34
Thereupon, on January 10, 2005, the UP brought a petition for certiorari in the CA to challenge
the jurisdiction of the RTC in issuing the order of December 21, 2004 (CA-G.R. CV No. 88125). 35 Aside
from raising the denial of due process, the UP averred that the RTC committed grave abuse of discretion
amounting to lack or excess of jurisdiction in ruling that there was no longer any legal impediment to the
release of the garnished funds. The UP argued that government funds and properties could not be seized
by virtue of writs of execution or garnishment, as held in Department of Agriculture v. National Labor
Relations Commission, 36 and citing Section 84 of Presidential Decree No. 1445 to the effect that
"[r]evenue funds shall not be paid out of any public treasury or depository except in pursuance of an
appropriation law or other specific statutory authority;" and that the order of garnishment clashed with the
ruling in University of the Philippines Board of Regents v. Ligot-Telan 37 to the effect that the funds
belonging to the UP were public funds.
On January 19, 2005, the CA issued a temporary restraining order (TRO) upon application by the
UP. 38
On March 22, 2005, Stern Builders and dela Cruz filed in the RTC their amended motion for
sheriff's assistance to implement the release order dated December 21, 2004, stating that the 60-day
period of the TRO of the CA had already lapsed. 39 The UP opposed the amended motion and countered
that the implementation of the release order be suspended. 40
On May 3, 2005, the RTC granted the amended motion for sheriff's assistance and directed the
sheriff to proceed to the DBP to receive the check in satisfaction of the judgment. 41
The UP sought the reconsideration of the order of May 3, 2005. 42
On May 16, 2005, DBP filed a motion to consign the check representing the judgment award and
to dismiss the motion to cite its officials in contempt of court. 43
On May 23, 2005, the UP presented a motion to withhold the release of the payment of the
judgment award. 44 HSDIaC
On July 8, 2005, the RTC resolved all the pending matters, 45 noting that the DBP had already
delivered to the sheriff Manager's Check No. 811941 for P16,370,191.74 representing the garnished funds
payable to the order of Stern Builders and dela Cruz as its compliance with the RTC's order dated
December 21, 2004.46 However, the RTC directed in the same order that Stern Builders and dela Cruz
should not encash the check or withdraw its amount pending the final resolution of the UP's petition
for certiorari, to wit: 47
 To enable the money represented in the check in question (No.
00008119411) to earn interest during the pendency of the defendant University of
the Philippines application for a writ of injunction with the Court of Appeals the same
may now be deposited by the plaintiff at the garnishee Bank (Development Bank of
the Philippines), the disposition of the amount represented therein being subject to
the final outcome of the case of the University of the Philippines, et al. vs. Hon.
Agustin S. Dizon, et al., (CA G.R. 88125) before the Court of Appeals.
Let it be stated herein that the plaintiff is not authorized to encash and
withdraw the amount represented in the check in question and enjoy the same in
the fashion of an owner during the pendency of the case between the parties before
the Court of Appeals which may or may not be resolved in plaintiff's favor.
With the end in view of seeing to it that the check in question is deposited
by the plaintiff at the Development Bank of the Philippines (garnishee bank), Branch
Sheriff Herlan Velasco is directed to accompany and/or escort the plaintiff in making
the deposit of the check in question.
SO ORDERED.
On September 16, 2005, the CA promulgated its assailed decision dismissing the UP's petition
for certiorari, ruling that the UP had been given ample opportunity to contest the motion to direct the DBP to
deposit the check in the name of Stern Builders and dela Cruz; and that the garnished funds could be the
proper subject of garnishment because they had been already earmarked for the project, with the UP
holding the funds only in a fiduciary capacity, 48 viz.:
Petitioners next argue that the UP funds may not be seized for execution
or garnishment to satisfy the judgment award. Citing Department of Agriculture vs.
NLRC, University of the Philippines Board of Regents vs. Hon. Ligot-Telan,
petitioners contend that UP deposits at Land Bank and the Development Bank of
the Philippines, being government funds, may not be released absent an
appropriations bill from Congress. TcIAHS
The argument is specious. UP entered into a contract with private
respondents for the expansion and renovation of the Arts and Sciences Building of
its campus in Los Baños, Laguna. Decidedly, there was already an appropriations
earmarked for the said project. The said funds are retained by UP, in a fiduciary
capacity, pending completion of the construction project.
We agree with the trial Court [sic] observation on this score:
"4. Executive Order No. 109 (Directing all National
Government Agencies to Revert Certain Accounts Payable to the
Cumulative Result of Operations of the National Government and for
Other Purposes) Section 9. Reversion of Accounts Payable, provides
that, all 1995 and prior years documented accounts payable and all
undocumented accounts regardless of the year they were incurred shall
be reverted to the Cumulative Result of Operations of the National
Government (CROU). This shall apply to accounts payable of all funds,
except fiduciary funds, as long as the purpose for which the funds were
created have not been accomplished and accounts payable under
foreign assisted projects for the duration of the said project. In this regard,
the Department of Budget and Management issued Joint-Circular No.
99-6 4.0 (4.3) Procedural Guidelines which provides that all accounts
payable that reverted to the CROU may be considered for payment upon
determination thru administrative process, of the existence, validity and
legality of the claim. Thus, the allegation of the defendants that
considering no appropriation for the payment of any amount awarded to
plaintiffs appellee the funds of defendant-appellants may not be seized
pursuant to a writ of execution issued by the regular court is misplaced.
Surely when the defendants and the plaintiff entered into the General
Construction of Agreement there is an amount already allocated by the
latter for the said project which is no longer subject of future
appropriation." 49
After the CA denied their motion for reconsideration on December 23, 2005, the petitioners
appealed by petition for review.
Matters Arising During the Pendency of the Petition
On January 30, 2006, Judge Dizon of the RTC (Branch 80) denied Stern Builders and dela
Cruz's motion to withdraw the deposit, in consideration of the UP's intention to appeal to the CA, 50 stating:
Since it appears that the defendants are intending to file a petition for
review of the Court of Appeals resolution in CA-G.R. No. 88125 within the
reglementary period of fifteen (15) days from receipt of resolution, the Court agrees
with the defendants stand that the granting of plaintiffs' subject motion is premature.
Let it be stated that what the Court meant by its Order dated July 8, 2005
which states in part that the "disposition of the amount represented therein being
subject to the final outcome of the case of the University of the Philippines, et al. vs.
Hon. Agustin S. Dizon, et al., (CA G.R. No. 88125 before the Court of Appeals) is
that the judgment or resolution of said court has to be final and executory, for if the
same will still be elevated to the Supreme Court, it will not attain finality yet until the
highest court has rendered its own final judgment or resolution. 51 CAScIH
However, on January 22, 2007, the UP filed an Urgent Application for A Temporary Restraining
Order and/or A Writ of Preliminary Injunction, 52 averring that on January 3, 2007, Judge Maria Theresa
dela Torre-Yadao (who had meanwhile replaced Judge Dizon upon the latter's appointment to the CA) had
issued another order allowing Stern Builders and dela Cruz to withdraw the deposit, 53 to wit:
It bears stressing that defendants' liability for the payment of the
judgment obligation has become indubitable due to the final and executory nature of
the Decision dated November 28, 2001. Insofar as the payment of
the [sic] judgment obligation is concerned, the Court believes that there is nothing
more the defendant can do to escape liability. It is observed that there is nothing
more the defendant can do to escape liability. It is observed that defendant U.P.
System had already exhausted all its legal remedies to overturn, set aside or modify
the decision (dated November 28, 2001 (rendered against it. The way the Court
sees it, defendant U.P. System's petition before the Supreme Court concerns only
with the manner by which said judgment award should be satisfied. It has nothing to
do with the legality or propriety thereof, although it prays for the deletion
of [sic] reduction of the award of moral damages.
It must be emphasized that this Court's finding, i.e., that there was
sufficient appropriation earmarked for the project, was upheld by the Court of
Appeals in its decision dated September 16, 2005. Being a finding of fact, the
Supreme Court will, ordinarily, not disturb the same was said Court is not a trier of
 fact. Such being the case, defendants' arguments that there was no sufficient
appropriation for the payment of the judgment obligation must fail.
While it is true that the former Presiding Judge of this Court in its Order
dated January 30, 2006 had stated that:
Let it be stated that what the Court meant by its Order dated
July 8, 2005 which states in part that the "disposition of the amount
represented therein being subject to the final outcome of the case of
the University of the Philippines, et al. vs. Hon. Agustin S. Dizon, et al.,
(CA G.R. No. 88125 before the Court of Appeals) is that the judgment or
resolution of said court has to be final and executory, for if the same will
still be elevated to the Supreme Court, it will not attain finality yet until the
highest court has rendered its own final judgment or resolution. ITDHcA
it should be noted that neither the Court of Appeals nor the Supreme
Court issued a preliminary injunction enjoining the release or withdrawal of the
garnished amount. In fact, in its present petition for review before the Supreme
Court, U.P. System has not prayed for the issuance of a writ of preliminary
injunction. Thus, the Court doubts whether such writ is forthcoming.
The Court honestly believes that if defendants' petition assailing the
Order of this Court dated December 31, 2004 granting the motion for the release of
the garnished amount was meritorious, the Court of Appeals would have issued a
writ of injunction enjoining the same. Instead, said appellate [c]ourt not only refused
to issue a wit of preliminary injunction prayed for by U.P. System but denied the
petition, as well. 54
The UP contended that Judge Yadao thereby effectively reversed the January 30, 2006 order of
Judge Dizon disallowing the withdrawal of the garnished amount until after the decision in the case would
have become final and executory.
Although the Court issued a TRO on January 24, 2007 to enjoin Judge Yadao and all persons
acting pursuant to her authority from enforcing her order of January 3, 2007, 55 it appears that on January
16, 2007, or prior to the issuance of the TRO, she had already directed the DBP to forthwith release the
garnished amount to Stern Builders and dela Cruz; 56 and that DBP had forthwith complied with the order
on January 17, 2007 upon the sheriff's service of the order of Judge Yadao. 57
These intervening developments impelled the UP to file in this Court a supplemental petition on
January 26, 2007, 58 alleging that the RTC (Judge Yadao) gravely erred in ordering the immediate release
of the garnished amount despite the pendency of the petition for review in this Court.
The UP filed a second supplemental petition 59 after the RTC (Judge Yadao) denied the UP's
motion for the redeposit of the withdrawn amount on April 10, 2007, 60to wit:
This resolves defendant U.P. System's Urgent Motion to Redeposit
Judgment Award praying that plaintiffs be directed to redeposit the judgment award
to DBP pursuant to the Temporary Restraining Order issued by the Supreme Court.
Plaintiffs opposed the motion and countered that the Temporary Restraining Order
issued by the Supreme Court has become moot and academic considering that the
act sought to be restrained by it has already been performed. They also alleged that
the redeposit of the judgment award was no longer feasible as they have already
spent the same.
It bears stressing, if only to set the record straight, that this Court did not
— in its Order dated January 3, 2007 (the implementation of which was restrained
by the Supreme Court in its Resolution dated January 24, 2002) — direct that that
garnished amount "be deposited with the garnishee bank (Development Bank of the
Philippines)". In the first place, there was no need to order DBP to make such
deposit, as the garnished amount was already deposited in the account of plaintiffs
with the DBP as early as May 13, 2005. What the Court granted in its Order dated
January 3, 2007 was plaintiff's motion to allow the release of said deposit. It must be
recalled that the Court found plaintiff's motion meritorious and, at that time, there
was no restraining order or preliminary injunction from either the Court of Appeals or
the Supreme Court which could have enjoined the release of plaintiffs' deposit. The
Court also took into account the following factors: DCASIT
a) the Decision in this case had long been final and executory after it was
rendered on November 28, 2001;
b) the propriety of the dismissal of U.P. System's appeal was upheld by
the Supreme Court;
c) a writ of execution had been issued;
d) defendant U.P. System's deposit with DBP was garnished pursuant to
a lawful writ of execution issued by the Court; and
e) the garnished amount had already been turned over to the plaintiffs
and deposited in their account with DBP.
The garnished amount, as discussed in the Order dated January 16,
2007, was already owned by the plaintiffs, having been delivered to them by the
Deputy Sheriff of this Court pursuant to par. (c), Section 9, Rule 39 of the 1997
Rules of Civil Procedure. Moreover, the judgment obligation has already been fully
satisfied as per Report of the Deputy Sheriff.
Anent the Temporary Restraining Order issued by the Supreme Court,
the same has become functus oficio, having been issued after the garnished
amount had been released to the plaintiffs. The judgment debt was released to the
plaintiffs on January 17, 2007, while the Temporary Restraining Order issued by the
Supreme Court was received by this Court on February 2, 2007. At the time of the
issuance of the Restraining Order, the act sought to be restrained had already been
done, thereby rendering the said Order ineffectual.
After a careful and thorough study of the arguments advanced by the
parties, the Court is of the considered opinion that there is no legal basis to grant
defendant U.P. System's motion to redeposit the judgment amount. Granting said
motion is not only contrary to law, but it will also render this Court's final executory
judgment nugatory. Litigation must end and terminate sometime and somewhere,
and it is essential to an effective administration of justice that once a judgment has
become final the issue or cause involved therein should be laid to rest. This doctrine
of finality of judgment is grounded on fundamental considerations of public policy
and sound practice. In fact, nothing is more settled in law than that once a judgment
attains finality it thereby becomes immutable and unalterable. It may no longer be
modified in any respect, even if the modification is meant to correct what is
perceived to be an erroneous conclusion of fact or law, and regardless of whether
 the modification is attempted to be made by the court rendering it or by the highest
court of the land.
WHEREFORE, premises considered, finding defendant U.P. System's
Urgent Motion to Redeposit Judgment Award devoid of merit, the same is hereby
DENIED. AScHCD
SO ORDERED.
Issues
The UP now submits that:
I the UP's limited budget allocated for the remuneration, job satisfaction and fulfillment of the best available
THE COURT OF APPEALS COMMITTED GRAVE ERROR IN DISMISSING
THE PETITION, ALLOWING IN EFFECT THE GARNISHMENT OF UP FUNDS,
WHEN IT RULED THAT FUNDS HAVE ALREADY BEEN EARMARKED FOR
THE CONSTRUCTION PROJECT; AND THUS, THERE IS NO NEED FOR
FURTHER APPROPRIATIONS.
II
THE COURT OF APPEALS COMMITTED GRAVE ERROR IN ALLOWING
GARNISHMENT OF A STATE UNIVERSITY'S FUNDS IN VIOLATION OF
ARTICLE XIV, SECTION 5(5) OF THE CONSTITUTION.
III
IN THE ALTERNATIVE, THE UNIVERSITY INVOKES EQUITY AND THE
REVIEW POWERS OF THIS HONORABLE COURT TO MODIFY, IF NOT
TOTALLY DELETE THE AWARD OF P10 MILLION AS MORAL DAMAGES TO
RESPONDENTS.
IV
THE RTC-BRANCH 80 COMMITTED GRAVE ERROR IN ORDERING THE
IMMEDIATE RELEASE OF THE JUDGMENT AWARD IN ITS ORDER DATED 3
JANUARY 2007 ON THE GROUND OF EQUITY AND JUDICIAL
COURTESY. IHDCcT
V
THE RTC-BRANCH 80 COMMITTED GRAVE ERROR IN ORDERING THE
IMMEDIATE RELEASE OF THE JUDGMENT AWARD IN ITS ORDER DATED
16 JANUARY 2007 ON THE GROUND THAT PETITIONER UNIVERSITY STILL
HAS A PENDING MOTION FOR RECONSIDERATION OF THE ORDER
DATED 3 JANUARY 2007.
VI
THE RTC-BRANCH 80 COMMITTED GRAVE ERROR IN NOT ORDERING
THE REDEPOSIT OF THE GARNISHED AMOUNT TO THE DBP IN
VIOLATION OF THE CLEAR LANGUAGE OF THE SUPREME COURT
RESOLUTION DATED 24 JANUARY 2007.
The UP argues that the amount earmarked for the construction project had been purposely set
aside only for the aborted project and did not include incidental matters like the awards of actual damages,
moral damages and attorney's fees. In support of its argument, the UP cited Article 12.2 of the General
Construction Agreement, which stipulated that no deductions would be allowed for the payment of claims,
damages, losses and expenses, including attorney's fees, in case of any litigation arising out of the
performance of the work. The UP insists that the CA decision was inconsistent with the rulings
in Commissioner of Public Highways v. San Diego 61 and Department of Agriculture v. NLRC 62 to the
effect that government funds and properties could not be seized under writs of execution or garnishment to
satisfy judgment awards.
Furthermore, the UP contends that the CA contravened Section 5, Article XIV of the Constitution
by allowing the garnishment of UP funds, because the garnishment resulted in a substantial reduction of
teachers; that Judge Yadao should have exhibited judicial courtesy towards the Court due to the pendency
of the UP's petition for review; and that she should have also desisted from declaring that the TRO issued
by this Court had become functus officio.
Lastly, the UP states that the awards of actual damages of P5,716,729.00 and moral damages of
P10 million should be reduced, if not entirely deleted, due to its being unconscionable, inequitable and
detrimental to public service. aECSHI
In contrast, Stern Builders and dela Cruz aver that the petition for review was fatally defective for
its failure to mention the other cases upon the same issues pending between the parties (i.e., CA-G.R. No.
77395 and G.R. No. 163501); that the UP was evidently resorting to forum shopping, and to delaying the
satisfaction of the final judgment by the filing of its petition for review; that the ruling in Commissioner of
Public Works v. San Diego had no application because there was an appropriation for the project; that the
UP retained the funds allotted for the project only in a fiduciary capacity; that the contract price had been
meanwhile adjusted to P22,338,553.25, an amount already more than sufficient to cover the judgment
award; that the UP's prayer to reduce or delete the award of damages had no factual basis, because they
had been gravely wronged, had been deprived of their source of income, and had suffered untold miseries,
discomfort, humiliation and sleepless years; that dela Cruz had even been constrained to sell his house, his
equipment and the implements of his trade, and together with his family had been forced to live miserably
because of the wrongful actuations of the UP; and that the RTC correctly declared the Court's TRO to be
already functus officio by reason of the withdrawal of the garnished amount from the DBP.
The decisive issues to be considered and passed upon are, therefore: (a) whether the funds of
the UP were the proper subject of garnishment in order to satisfy the judgment award; and (b) whether the
UP's prayer for the deletion of the awards of actual damages of P5,716,729.00, moral damages of
P10,000,000.00 and attorney's fees of P150,000.00 plus P1,500.00 per appearance could be granted
despite the finality of the judgment of the RTC.
Ruling
The petition for review is meritorious.
I.
UP's funds, being government funds,
are not subject to garnishment
The UP was founded on June 18, 1908 through Act 1870 to provide advanced instruction in
literature, philosophy, the sciences, and arts, and to give professional and technical training to deserving
students. 63 Despite its establishment as a body corporate, 64 the UP remains to be a "chartered
institution" 65 performing a legitimate government function. It is an institution of higher learning, not a
corporation established for profit and declaring any dividends. 66 In enacting Republic Act No. 9500 (The
University of the Philippines Charter of 2008), Congress has declared the UP as the national
university 67 "dedicated to the search for truth and knowledge as well as the development of future
leaders." 68 ASIDTa
Irrefragably, the UP is a government instrumentality, 69 performing the State's constitutional
mandate of promoting quality and accessible education. 70 As a government instrumentality, the UP
administers special funds sourced from the fees and income enumerated under Act No. 1870 and Section
1 of Executive Order No. 714, 71 and from the yearly appropriations, to achieve the purposes laid down by
Section 2 of Act 1870, as expanded in Republic Act No. 9500. 72 All the funds going into the possession of
the UP, including any interest accruing from the deposit of such funds in any banking institution, constitute
a "special trust fund," the disbursement of which should always be aligned with the UP's mission and
purpose, 73 and should always be subject to auditing by the COA. 74
Presidential Decree No. 1445 defines a "trust fund" as a fund that officially comes in the
possession of an agency of the government or of a public officer as trustee, agent or administrator, or that
is received for the fulfillment of some obligation. 75 A trust fund may be utilized only for the "specific
purpose for which the trust was created or the funds received." 76
The funds of the UP are government funds that are public in character. They include the income
accruing from the use of real property ceded to the UP that may be spent only for the attainment of its
institutional objectives. 77 Hence, the funds subject of this action could not be validly made the subject of
the RTC's writ of execution or garnishment. The adverse judgment rendered against the UP in a suit to
which it had impliedly consented was not immediately enforceable by execution against the
UP, 78 because suability of the State did not necessarily mean its liability. 79
A marked distinction exists between suability of the State and its liability. As the Court succinctly
stated in Municipality of San Fernando, La Union v. Firme: 80
A distinction should first be made between suability and liability. "Suability
depends on the consent of the state to be sued, liability on the applicable law and
the established facts. The circumstance that a state is suable does not necessarily
mean that it is liable; on the other hand, it can never be held liable if it does not first
consent to be sued. Liability is not conceded by the mere fact that the state has
allowed itself to be sued. When the state does waive its sovereign immunity, it is
only giving the plaintiff the chance to prove, if it can, that the defendant is liable.
Also, in Republic v. Villasor, 81 where the issuance of an alias writ of execution directed against
the funds of the Armed Forces of the Philippines to satisfy a final and executory judgment was nullified, the
Court said: CDaTAI
. . . The universal rule that where the State gives its consent to be sued by private
parties either by general or special law, it may limit claimant's action "only up to
the completion of proceedings anterior to the stage of execution" and that the
power of the Courts ends when the judgment is rendered, since government
funds and properties may not be seized under writs of execution or garnishment
to satisfy such judgments, is based on obvious considerations of public policy.
Disbursements of public funds must be covered by the corresponding
appropriation as required by law. The functions and public services rendered by
the State cannot be allowed to be paralyzed or disrupted by the diversion of
public funds from their legitimate and specific objects, as appropriated by law.
The UP correctly submits here that the garnishment of its funds to satisfy the judgment awards of
actual and moral damages (including attorney's fees) was not validly made if there was no special
appropriation by Congress to cover the liability. It was, therefore, legally unwarranted for the CA to agree
with the RTC's holding in the order issued on April 1, 2003 that no appropriation by Congress to allocate
and set aside the payment of the judgment awards was necessary because "there (were) already an
appropriations (sic) earmarked for the said project." 82 The CA and the RTC thereby unjustifiably ignored
the legal restriction imposed on the trust funds of the Government and its agencies and instrumentalities to
be used exclusively to fulfill the purposes for which the trusts were created or for which the funds were
received except upon express authorization by Congress or by the head of a government agency in control
of the funds, and subject to pertinent budgetary laws, rules and regulations. 83
Indeed, an appropriation by Congress was required before the judgment that rendered the UP
liable for moral and actual damages (including attorney's fees) would be satisfied considering that such
monetary liabilities were not covered by the "appropriations earmarked for the said project." The
Constitution strictly mandated that "(n)o money shall be paid out of the Treasury except in pursuance of an
appropriation made by law." 84 TEacSA
II
COA must adjudicate private respondents' claim
before execution should proceed
The execution of the monetary judgment against the UP was within the primary jurisdiction of the
COA. This was expressly provided in Section 26 of Presidential Decree No. 1445, to wit:
Section 26. General jurisdiction. — The authority and powers of the
Commission shall extend to and comprehend all matters relating to auditing
procedures, systems and controls, the keeping of the general accounts of the
Government, the preservation of vouchers pertaining thereto for a period of ten
years, the examination and inspection of the books, records, and papers relating to
those accounts; and the audit and settlement of the accounts of all persons
respecting funds or property received or held by them in an accountable capacity,
as well as the examination, audit, and settlement of all debts and claims of
any sort due from or owing to the Government or any of its subdivisions,
agencies and instrumentalities. The said jurisdiction extends to all
government-owned or controlled corporations, including their subsidiaries,
and other self-governing boards, commissions, or agencies of the
Government, and as herein prescribed, including non-governmental entities
subsidized by the government, those funded by donations through the
government, those required to pay levies or government share, and those for
which the government has put up a counterpart fund or those partly funded
by the government.
It was of no moment that a final and executory decision already validated the claim against the
UP. The settlement of the monetary claim was still subject to the primary jurisdiction of the COA despite the
final decision of the RTC having already validated the claim. 85 As such, Stern Builders and dela Cruz as
the claimants had no alternative except to first seek the approval of the COA of their monetary claim.
On its part, the RTC should have exercised utmost caution, prudence and judiciousness in
dealing with the motions for execution against the UP and the garnishment of the UP's funds. The RTC had
no authority to direct the immediate withdrawal of any portion of the garnished funds from the depository
banks of the UP. By eschewing utmost caution, prudence and judiciousness in dealing with the execution
and garnishment, and by authorizing the withdrawal of the garnished funds of the UP, the RTC acted
beyond its jurisdiction, and all its orders and issuances thereon were void and of no legal effect,
specifically: (a) the order Judge Yadao issued on January 3, 2007 allowing Stern Builders and dela Cruz to
withdraw the deposited garnished amount; (b) the order Judge Yadao issued on January 16, 2007
directing DBP to forthwith release the garnish amount to Stern Builders and dela Cruz; (c) the sheriff's
report of January 17, 2007 manifesting the full satisfaction of the writ of execution; and (d) the order of April
10, 2007 deying the UP's motion for the redeposit of the withdrawn amount. Hence, such orders and
issuances should be struck down without exception. ScHADI
Nothing extenuated Judge Yadao's successive violations of Presidential Decree No. 1445. She
was aware of Presidential Decree No. 1445, considering that the Court circulated to all judges
its Administrative Circular No. 10-2000, 86 issued on October 25, 2000, enjoining them "to observe utmost
caution, prudence and judiciousness in the issuance of writs of execution to satisfy money judgments
against government agencies and local government units" precisely in order to prevent the circumvention
of Presidential Decree No. 1445, as well as of the rules and procedures of the COA, to wit:
In order to prevent possible circumvention of the rules and
procedures of the Commission on Audit, judges are hereby enjoined to
observe utmost caution, prudence and judiciousness in the issuance of writs
of execution to satisfy money judgments against government agencies and
local government units.
Judges should bear in mind that in Commissioner of Public Highways v.
San Diego (31 SCRA 617, 625 [1970]), this Court explicitly stated:
"The universal rule that where the State gives its consent to be
sued by private parties either by general or special law, it may limit
claimant's action 'only up to the completion of proceedings anterior to the
stage of execution' and that the power of the Court ends when the
judgment is rendered, since government funds and properties may not be
seized under writs of execution or garnishment to satisfy such judgments,
is based on obvious considerations of public policy. Disbursements of
public funds must be covered by the corresponding appropriation as
required by law. The functions and public services rendered by the State
cannot be allowed to be paralyzed or disrupted by the diversion of public
funds from their legitimate and specific objects, as appropriated by
law. IaHSCc
Moreover, it is settled jurisprudence that upon determination of
State liability, the prosecution, enforcement or satisfaction thereof must still
be pursued in accordance with the rules and procedures laid down in P.D. No.
1445, otherwise known as the Government Auditing Code of the Philippines
(Department of Agriculture v. NLRC, 227 SCRA 693, 701-02 [1993]
citing Republic vs. Villasor, 54 SCRA 84 [1973]). All money claims against the
Government must first be filed with the Commission on Audit which must act
upon it within sixty days. Rejection of the claim will authorize the claimant to
elevate the matter to the Supreme Court on certiorari and in effect, sue the
State thereby (P.D. 1445, Sections 49-50).
However, notwithstanding the rule that government properties are not
subject to levy and execution unless otherwise provided for by statute (Republic v.
Palacio, 23 SCRA 899 [1968]; Commissioner of Public Highways v. San Diego,
supra) or municipal ordinance (Municipality of Makati v. Court of Appeals, 190
SCRA 206 [1990]), the Court has, in various instances, distinguished between
government funds and properties for public use and those not held for public use.
Thus, in Viuda de Tan Toco v. Municipal Council of Iloilo (49 Phil. 52 [1926]), the
Court ruled that "[w]here property of a municipal or other public corporation is
sought to be subjected to execution to satisfy judgments recovered against such
corporation, the question as to whether such property is leviable or not is to be
determined by the usage and purposes for which it is held." The following can be
culled from Viuda de Tan Toco v. Municipal Council of Iloilo:
1. Properties held for public uses — and generally everything held
for governmental purposes — are not subject to levy and sale under
execution against such corporation. The same rule applies to funds in the
hands of a public officer and taxes due to a municipal corporation.
2. Where a municipal corporation owns in its proprietary capacity, as
distinguished from its public or government capacity, property not used or used for a
public purpose but for quasi-private purposes, it is the general rule that such
property may be seized and sold under execution against the corporation.
3. Property held for public purposes is not subject to execution merely
because it is temporarily used for private purposes. If the public use is wholly
abandoned, such property becomes subject to execution.
This Administrative Circular shall take effect immediately and the Court
Administrator shall see to it that it is faithfully implemented.
Although Judge Yadao pointed out that neither the CA nor the Court had issued as of then any
writ of preliminary injunction to enjoin the release or withdrawal of the garnished amount, she did not need
any writ of injunction from a superior court to compel her obedience to the law. The Court is disturbed that
an experienced judge like her should look at public laws like Presidential Decree No. 1445 dismissively
instead of loyally following and unquestioningly implementing them. That she did so turned her court into an
oppressive bastion of mindless tyranny instead of having it as a true haven for the seekers of justice like the
UP. TaCDIc
III
Period of appeal did not start without effective
service of decision upon counsel of record;
Fresh period rule announced in
Neypes v. Court of Appeals
can be given retroactive application
The UP next pleads that the Court gives due course to its petition for review in the name of equity
in order to reverse or modify the adverse judgment against it despite its finality. At stake in the UP's plea for
equity was the return of the amount of P16,370,191.74 illegally garnished from its trust funds. Obstructing
the plea is the finality of the judgment based on the supposed tardiness of UP's appeal, which the RTC
declared on September 26, 2002. The CA upheld the declaration of finality on February 24, 2004, and the
Court itself denied the UP's petition for review on that issue on May 11, 2004 (G.R. No. 163501). The denial
became final on November 12, 2004.
It is true that a decision that has attained finality becomes immutable and unalterable, and cannot
be modified in any respect, 87 even if the modification is meant to correct erroneous conclusions of fact
and law, and whether the modification is made by the court that rendered it or by this Court as the highest
court of the land. 88Public policy dictates that once a judgment becomes final, executory and unappealable,
the prevailing party should not be deprived of the fruits of victory by some subterfuge devised by the losing
party. Unjustified delay in the enforcement of such judgment sets at naught the role and purpose of the
courts to resolve justiciable controversies with finality. 89 Indeed, all litigations must at some time end,
even at the risk of occasional errors.
 But the doctrine of immutability of a final judgment has not been absolute, and has admitted
several exceptions, among them: (a) the correction of clerical errors;(b) the so-called nunc pro tunc entries
that cause no prejudice to any party; (c) void judgments; and (d) whenever circumstances transpire after
the finality of the decision that render its execution unjust and inequitable. 90 Moreover, in Heirs of Maura
So v. Obliosca, 91 we stated that despite the absence of the preceding circumstances, the Court is not
precluded from brushing aside procedural norms if only to serve the higher interests of justice and equity.
Also, in Gumaru v. Quirino State College, 92 the Court nullified the proceedings and the writ of execution
issued by the RTC for the reason that respondent state college had not been represented in the litigation by
the Office of the Solicitor General.
We rule that the UP's plea for equity warrants the Court's exercise of the exceptional power to
disregard the declaration of finality of the judgment of the RTC for being in clear violation of the UP's right to
due process. aAcHCT
Both the CA and the RTC found the filing on June 3, 2002 by the UP of the notice of appeal to be
tardy. They based their finding on the fact that only six days remained of the UP's reglementary 15-day
period within which to file the notice of appeal because the UP had filed a motion for reconsideration on
January 16, 2002vis-à-vis the RTC's decision the UP received on January 7, 2002; and that because the
denial of the motion for reconsideration had been served upon Atty. Felimon D. Nolasco of the UPLB Legal
Office on May 17, 2002, the UP had only until May 23, 2002 within which to file the notice of appeal.
The UP counters that the service of the denial of the motion for reconsideration upon Atty.
Nolasco was defective considering that its counsel of record was not Atty. Nolasco of the UPLB Legal
Office but the OLS in Diliman, Quezon City; and that the period of appeal should be reckoned from May 31,
2002, the date when the OLS received the order. The UP submits that the filing of the notice of appeal on
June 3, 2002 was well within the reglementary period to appeal.
We agree with the submission of the UP.
Firstly, the service of the denial of the motion for reconsideration upon Atty. Nolasco of the UPLB
Legal Office was invalid and ineffectual because he was admittedly not the counsel of record of the UP. The
rule is that it is on the counsel and not the client that the service should be made. 93 That counsel was the
OLS in Diliman, Quezon City, which was served with the denial only on May 31, 2002. As such, the running
of the remaining period of six days resumed only on June 1, 2002, 94rendering the filing of the UP's notice
of appeal on June 3, 2002 timely and well within the remaining days of the UP's period to appeal.
Verily, the service of the denial of the motion for reconsideration could only be validly made upon
the OLS in Diliman, and no other. The fact that Atty. Nolasco was in the employ of the UP at the UPLB
Legal Office did not render the service upon him effective. It is settled that where a party has appeared by
counsel, service must be made upon such counsel. 95 Service on the party or the party's employee is not
effective because such notice is not notice in law. 96 This is clear enough from Section 2, second
paragraph, of Rule 13, Rules of Court, which explicitly states that: "If any party has appeared by counsel,
service upon him shall be made upon his counsel or one of them, unless service upon the party himself is
ordered by the court. Where one counsel appears for several parties, he shall only be entitled to one copy
of any paper served upon him by the opposite side." As such, the period to appeal resumed only on June 1,
2002, the date following the service on May 31, 2002 upon the OLS in Diliman of the copy of the decision of
the RTC, not from the date when the UP was notified. 97 TaEIcS
Accordingly, the declaration of finality of the judgment of the RTC, being devoid of factual and
legal bases, is set aside.
Secondly, even assuming that the service upon Atty. Nolasco was valid and effective, such that
the remaining period for the UP to take a timely appeal would end by May 23, 2002, it would still not be
correct to find that the judgment of the RTC became final and immutable thereafter due to the notice of
appeal being filed too late on June 3, 2002.
In so declaring the judgment of the RTC as final against the UP, the CA and the RTC applied the
rule contained in the second paragraph of Section 3, Rule 41 of theRules of Court to the effect that the filing
of a motion for reconsideration interrupted the running of the period for filing the appeal; and that the period
resumed upon notice of the denial of the motion for reconsideration. For that reason, the CA and the RTC
might not be taken to task for strictly adhering to the rule then prevailing.
However, equity calls for the retroactive application in the UP's favor of the fresh-period rule that
the Court first announced in mid-September of 2005 through its ruling in Neypes v. Court of
Appeals, 98 viz.:
To standardize the appeal periods provided in the Rules and to afford
litigants fair opportunity to appeal their cases, the Court deems it practical to allow a
fresh period of 15 days within which to file the notice of appeal in the Regional Trial
Court, counted from receipt of the order dismissing a motion for a new trial or motion
for reconsideration.
The retroactive application of the fresh-period rule, a procedural law that aims "to regiment or
make the appeal period uniform, to be counted from receipt of the order denying the motion for new trial,
motion for reconsideration (whether full or partial) or any final order or resolution," 99 is impervious to any
serious challenge. This is because there are no vested rights in rules of procedure. 100 A law or regulation
is procedural when it prescribes rules and forms of procedure in order that courts may be able to administer
justice. 101 It does not come within the legal conception of a retroactive law, or is not subject of the general
rule prohibiting the retroactive operation of statutes, but is given retroactive effect in actions pending and
undetermined at the time of its passage without violating any right of a person who may feel that he is
adversely affected. AEIcSa
We have further said that a procedural rule that is amended for the benefit of litigants in
furtherance of the administration of justice shall be retroactively applied to likewise favor actions then
pending, as equity delights in equality. 102 We may even relax stringent procedural rules in order to serve
substantial justice and in the exercise of this Court's equity jurisdiction. 103 Equity jurisdiction aims to do
complete justice in cases where a court of law is unable to adapt its judgments to the special circumstances
of a case because of the inflexibility of its statutory or legal jurisdiction. 104
It is cogent to add in this regard that to deny the benefit of the fresh-period rule to the UP would
amount to injustice and absurdity — injustice, because the judgment in question was issued on November
28, 2001 as compared to the judgment in Neypes that was rendered in 1998; absurdity, because parties
receiving notices of judgment and final orders issued in the year 1998 would enjoy the benefit of
the fresh-period rule but the later rulings of the lower courts like that herein would not. 105
Consequently, even if the reckoning started from May 17, 2002, when Atty. Nolasco received the
denial, the UP's filing on June 3, 2002 of the notice of appeal was not tardy within the context of
the fresh-period rule. For the UP, the fresh period of 15-days counted from service of the denial of the
motion for reconsideration would end on June 1, 2002, which was a Saturday. Hence, the UP had until the
next working day, or June 3, 2002, a Monday, within which to appeal, conformably with Section 1 of Rule
22, Rules of Court, which holds that: "If the last day of the period, as thus computed, falls on a Saturday, a
Sunday, or a legal holiday in the place where the court sits, the time shall not run until the next working
day."
IV
 Awards of monetary damages,
being devoid of factual and legal bases,
did not attain finality and should be deleted
Section 14 of Article VIII of the Constitution prescribes that express findings of fact and of law
should be made in the decision rendered by any court, to wit:
Section 14. No decision shall be rendered by any court without
expressing therein clearly and distinctly the facts and the law on which it is based.
No petition for review or motion for reconsideration of a decision of the
court shall be refused due course or denied without stating the legal basis
therefor. cDHAES
Implementing the constitutional provision in civil actions is Section 1 of Rule 36, Rules of
Court, viz.:
Section 1. Rendition of judgments and final orders. — A judgment or final
order determining the merits of the case shall be in writing personally and directly
prepared by the judge, stating clearly and distinctly the facts and the law on which it
is based, signed by him, and filed with the clerk of the court. (1a)
The Constitution and the Rules of Court apparently delineate two main essential parts of a
judgment, namely: the body and the decretal portion. Although the latter is the controlling part, 106 the
importance of the former is not to be lightly regarded because it is there where the court clearly and
distinctly states its findings of fact and of law on which the decision is based. To state it differently, one
without the other is ineffectual and useless. The omission of either inevitably results in a judgment that
violates the letter and the spirit of the Constitution and the Rules of Court.
The term findings of fact that must be found in the body of the decision refers to statements of
fact, not to conclusions of law. 107 Unlike in pleadings where ultimate facts alone need to be stated, the
Constitution and the Rules of Court require not only that a decision should state the ultimate facts but also
that it should specify the supporting evidentiary facts, for they are what are called the findings of fact.
The importance of the findings of fact and of law cannot be overstated. The reason and purpose
of the Constitution and the Rules of Court in that regard are obviously to inform the parties why they win or
lose, and what their rights and obligations are. Only thereby is the demand of due process met as to the
parties. As Justice Isagani A. Cruz explained in Nicos Industrial Corporation v. Court of Appeals: 108
It is a requirement of due process that the parties to a litigation be
informed of how it was decided, with an explanation of the factual and legal reasons
that led to the conclusions of the court. The court cannot simply say that judgment is
rendered in favor of X and against Y and just leave it at that without any justification
whatsoever for its action. The losing party is entitled to know why he lost, so he may
appeal to a higher court, if permitted, should he believe that the decision should be
reversed. A decision that does not clearly and distinctly state the facts and the law
on which it is based leaves the parties in the dark as to how it was reached and is
especially prejudicial to the losing party, who is unable to pinpoint the possible
errors of the court for review by a higher tribunal. AECacS
Here, the decision of the RTC justified the grant of actual and moral damages, and attorney's
fees in the following terse manner, viz.:
. . . The Court is not unmindful that due to defendants' unjustified refusal
to pay their outstanding obligation to plaintiff, the same suffered losses and incurred
expenses as he was forced to re-mortgage his house and lot located in Quezon City
to Metrobank (Exh. "CC") and BPI Bank just to pay its monetary obligations in the
form of interest and penalties incurred in the course of the construction of the
subject project. 109
The statement that "due to defendants' unjustified refusal to pay their outstanding obligation to
plaintiff, the same suffered losses and incurred expenses as he was forced to re-mortgage his house and
lot located in Quezon City to Metrobank (Exh. "CC") and BPI Bank just to pay its monetary obligations in the
form of interest and penalties incurred in the course of the construction of the subject project" was only a
conclusion of fact and law that did not comply with the constitutional and statutory prescription. The
statement specified no detailed expenses or losses constituting the P5,716,729.00 actual damages
sustained by Stern Builders in relation to the construction project or to other pecuniary hardships. The
omission of such expenses or losses directly indicated that Stern Builders did not prove them at all, which
then contravened Article 2199, Civil Code, the statutory basis for the award of actual damages, which
entitled a person to an adequate compensation only for such pecuniary loss suffered by him as he has duly
proved. As such, the actual damages allowed by the RTC, being bereft of factual support, were speculative
and whimsical. Without the clear and distinct findings of fact and law, the award amounted only to an ipse
dixit on the part of the RTC, 110 and did not attain finality.
There was also no clear and distinct statement of the factual and legal support for the award of
moral damages in the substantial amount of P10,000,000.00. The award was thus also speculative and
whimsical. Like the actual damages, the moral damages constituted another judicial ipse dixit, the
inevitable consequence of which was to render the award of moral damages incapable of attaining finality.
In addition, the grant of moral damages in that manner contravened the law that permitted the recovery of
moral damages as the means to assuage "physical suffering, mental anguish, fright, serious anxiety,
besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury." 111 The
contravention of the law was manifest considering that Stern Builders, as an artificial person, was incapable
of experiencing pain and moral sufferings. 112 Assuming that in granting the substantial amount of
P10,000,000.00 as moral damages, the RTC might have had in mind that dela Cruz had himself suffered
mental anguish and anxiety. If that was the case, then the RTC obviously disregarded his separate and
distinct personality from that of Stern Builders. 113 Moreover, his moral and emotional sufferings as the
President of Stern Builders were not the sufferings of Stern Builders. Lastly, the RTC violated the basic
principle that moral damages were not intended to enrich the plaintiff at the expense of the defendant, but
to restore the plaintiff to his status quo ante as much as possible. Taken together, therefore, all these
considerations exposed the substantial amount of P10,000,000.00 allowed as moral damages not only to
be factually baseless and legally indefensible, but also to be unconscionable, inequitable and
unreasonable. cSTDIC
Like the actual and moral damages, the P150,000.00, plus P1,500.00 per appearance, granted
as attorney's fees were factually unwarranted and devoid of legal basis. The general rule is that a
successful litigant cannot recover attorney's fees as part of the damages to be assessed against the losing
party because of the policy that no premium should be placed on the right to litigate. 114 Prior to the
effectivity of the present Civil Code, indeed, such fees could be recovered only when there was a
stipulation to that effect. It was only under the present Civil Code that the right to collect attorney's fees in
the cases mentioned in Article 2208 115 of the Civil Codecame to be recognized. 116 Nonetheless, with
attorney's fees being allowed in the concept of actual damages, 117 their amounts must be factually and
legally justified in the body of the decision and not stated for the first time in the decretal
portion. 118 Stating the amounts only in the dispositive portion of the judgment is not enough;119 a
rendition of the factual and legal justifications for them must also be laid out in the body of the decision. 120
That the attorney's fees granted to the private respondents did not satisfy the foregoing
requirement suffices for the Court to undo them. 121 The grant was ineffectual for being contrary to law and
public policy, it being clear that the express findings of fact and law were intended to bring the case within
the exception and thereby justify the award of the attorney's fees. Devoid of such express findings, the
award was a conclusion without a premise, its basis being improperly left to speculation and
conjecture. 122

Nonetheless, the absence of findings of fact and of any statement of the law and jurisprudence
on which the awards of actual and moral damages, as well as of attorney's fees, were based was a fatal
flaw that invalidated the decision of the RTC only as to such awards. As the Court declared in Velarde v.
Social Justice Society, 123the failure to comply with the constitutional requirement for a clear and distinct
statement of the supporting facts and law "is a grave abuse of discretion amounting to lack or excess of
jurisdiction" and that "(d)ecisions or orders issued in careless disregard of the constitutional mandate are a
patent nullity and must be struck down as void." 124 The other item granted by the RTC (i.e., P503,462.74)
shall stand, subject to the action of the COA as stated herein.

WHEREFORE, the Court GRANTS the petition for review on certiorari; REVERSES and SETS
ASIDE the decision of the Court of Appeals under review; ANNULS the orders for the garnishment of the
funds of the University of the Philippines and for the release of the garnished amount to Stern Builders
Corporation and Servillano dela Cruz; and DELETES from the decision of the Regional Trial Court dated
November 28, 2001 for being void only the awards of actual damages of P5,716,729.00, moral damages of
P10,000,000.00, and attorney's fees of P150,000.00, plus P1,500.00 per appearance, in favor of Stern
Builders Corporation and Servillano dela Cruz.

The Court ORDERS Stern Builders Corporation and Servillano dela Cruz to redeposit the
amount of P16,370,191.74 within 10 days from receipt of this decision.

Costs of suit to be paid by the private respondents.

SO ORDERED. Ta

||| (University of the Philippines v. Dizon, G.R. No. 171182, [August 23, 2012], 693 PHIL 226-268)
 SECOND DIVISION
[G.R. No. L-48214. December 19, 1978.]
ILDEFONSO SANTIAGO, represented by his Attorney-in-Fact, ALFREDO T.
SANTIAGO, petitioner, vs. THE GOVERNMENT OF THE REPUBLIC OF THE
PHILIPPINES, represented by the Director, Bureau of Plant Industry, and the
Regional Director, Region IX, Zamboanga City, respondent.
Ahmad D. Sahak for petitioner.
Solicitor General Estelito P. Mendoza, Assistant Solicitor General Octavio R.
Ramirez and Solicitor Mariano M. Martinez for respondents.
SYNOPSIS
Petitioner filed a suit against the respondent for the revocation of a deed of donation
executed by him and his spouse in 1971 alleging that the donee, Bureau of Plant Industry, failed to
abide by the conditions under which the donation was given. Respondent moved to have the case
dismiss on the premise that the State cannot be sued without its consent. The lower court sustained
the motion, hence, this present action.
The Supreme Court ruled that a donor, with the Republic of any of its agency being the
donee, is entitled to go to court in case of an alleged breach of the conditions of such donation, as the
doctrine of non-suability has to accommodate itself to the demands of procedural due process.
SYLLABUS
1. CONSTITUTIONAL LAW; STATE IMMUNITY FROM SUIT; SETTLED RULE. — The
State may not be sued without its consent. The Republic cannot be proceeded against unless it allows
itself to be sued. Neither can a department, bureau, agency, office, or instrumentality of the
government where the suit may result in adverse consequences to the public treasury, whether in the
disbursement of funds or loss of property.
2. ID.; ID.; RATIONALE. — The doctrine of non-suability, recognized in this jurisdiction
even prior to the effectivity of the (1935) Constitution, is a logical corollary of the positivist concept of
law which, to paraphrase Holmes, negates the assertion of any legal right as against the state, in itself
the source of the law on which such a right may be predicated. Even if such a principle does give rise
to problems, considering the vastly expanded role of government enabling it to engage in business
pursuits to promote the general welfare, it is not obeisance to the analytical school of thought alone
that calls for its continued applicability.
3. ID.; ID.; EXCEPTION. — Where there is consent, a suit may be filed. Consent need not
be express. It can be implied. As in Ministerio v. Court of First Instance of Cebu, L-31635, Aug. 31,
1971 which ruled: "The doctrine of governmental immunity from suit cannot serve as an instrument for
perpetrating an injustice on a citizen."
4. ID.; ID.; SUITS BY OR AGAINST GOVERNMENT-OWNED AND CONTROLLED
CORPORATIONS ALLOWED. — A government-owned and controlled corporation has a personality
of its own distinct and separate from that of the government. Accordingly, it may sue and be sued and
may be subjected to court processes just like any other corporation.
5. ID.; ID.; ID.; PROCEDURE TO BE FOLLOWED. — The remedy where the liability is
based on contract, is for plaintiff to file a claim with the Commission on Audit in accordance with the
controlling statute, Commonwealth Act No. 3082 and Act No. 327.
6. ID.; ID.; ID.; CASE AT BAR. — The alleged failure to abide by the conditions under which
a donation was given should not prove an insuperable obstacle to a civil action, the consent likewise
being presumed. This conclusion is strengthened by the fact that while a donation partakes of a
contract, there is no money claim, and therefore reliance on Commonwealth Act No. 327 would be
futile. A donor, with the Republic or any of its agency being the donee, is entitled to go to court in case
of an alleged breach of the conditions of such donation. He has the right to be heard. Under the
circumstances, the fundamental postulate of non-suability cannot stand in the way. It is made to
accommodate itself to the demands of procedural due process, which is the negation of arbitrariness
and inequity. The government, in the final analysis, is the beneficiary. It thereby manifests its
adherence to the highest ethical standards, which can only be ignored at the risk of losing the
confidence of the people, the repository of the sovereign power.
DECISION
FERNANDO, J p:
The first impression yielded by a perusal of this petition for certiorari is its inherent
weakness considering the explicit provision in the present Constitutionprohibiting a suit against the
Republic without its consent. 1 Here, petitioner Ildefonso Santiago 2 filed on August 9, 1976 an action
in the Court of First Instance of Zamboanga City naming as defendant the government of the Republic
of the Philippines represented by the Director of the Bureau of Plant Industry. 3 His plea was for the
revocation of a deed of donation executed by him and his spouse in January of 1971, 4 with the
Bureau of Plant Industry as the donee. As alleged in such complaint, such Bureau, contrary to the
terms of the donation, failed to "install lighting facilities and water system on the property donated and
to build an office building and parking [lot] thereon which should have been constructed and ready for
occupancy on or before December 7, 1974." 5 That led him to conclude that under the circumstances,
he was exempt from compliance with such an explicit constitutional command. The lower court, in the
order challenged in this petition, was of a different view. It sustained a motion to dismiss on the part of
the defendant Republic of the Philippines, now named as one of the respondents, the other
respondent being the Court of First Instance of Zamboanga City, Branch II. It premised such an order
on the settled "rule that the state cannot be sued without its consent. This is so, because the
New Constitution of the Philippines expressly provides that the state may not be sued without its
consent." 6 Solicitor General Estelito P. Mendoza, 7 in the comment on the petition filed with this
Court, is for the affirmance of the order of dismissal of respondent Court precisely to accord deference
to the above categorical constitutional mandate. LibLex
On its face, such a submission carries persuasion. Upon further reflection, this Tribunal is
impressed with the unique aspect of this petition for certiorari, dealing as it does with a suit for the
revocation of a donation to the Republic, which allegedly failed to conform with what was agreed to by
the donee. If an order of dismissal would suffice, then the element of unfairness enters, the facts
alleged being hypothetically admitted. It is the considered opinion of this Court then that to conform to
the high dictates of equity and justice, the presumption of consent could be indulged in safely. That
would serve to accord to petitioner as plaintiff, at the very least, the right to be heard. Certiorari
lies. llcd
1. This is not to deny the obstacle posed by the constitutional provision. It is expressed in
language plain and unmistakable: "The State may not be sued without its consent." 8 The Republic
cannot be proceeded against unless it allows itself to be sued. Neither can a department, bureau,
agency, office, or instrumentality of the government where the suit, according to the then Justice, now
Chief Justice, Castro in Del Mar v. Philippine Veterans Administration, 9 may result "in adverse
consequences to the public treasury, whether in the disbursements of funds or loss of
property." 10 Such a doctrine was reiterated in the following cases: Republic v. Villasor, 11 Sayson v.
Singson, 12 Director of the Bureau of Printing v. Francisco, 13 and Republic v. Purisima. 14
2. It is contended by counsel for petitioner that the above constitutional provision would be
given a retroactive application in this case if the suit for the revocation of donation were dismissed.
That is not the case at all. In Republic v. Purisima, this Court made clear that such a basic postulate is
part and parcel of the system of government implanted in the Philippines from the time of the
acquisition of sovereignty by the United States, and therefore, was implicit in the 1935
Constitution even in the absence of any explicit language to that effect. This it did in a citation from
Switzerland General Insurance Co., Ltd. v. Republic of the Philippines: 15 "The doctrine of
non-suability recognized in this jurisdiction even prior to the effectivity of the [1935] Constitution is a
logical corollary of the positivist concept of law which, to paraphrase Holmes, negates the assertion of
any legal right as against the state, in itself the source of the law on which such a right may be
predicated. Nor is this all. Even if such a principle does give rise to problems, considering the vastly
expanded role of government enabling it to engage in business pursuits to promote the general
welfare, it is not obeisance to the analytical school of thought alone that calls for its continued
applicability." 16 That is the teaching of the leading case of Mobil Philippines Exploration, Inc. v.
Customs Arrastre Service, 17 promulgated in December of 1966. As a matter of fact, the Switzerland
General Insurance Co. decision was the thirty-seventh of its kind after Mobil. Clearly, then, the
contention that to dismiss the suit would be to give the applicable constitutional provision a retroactive
effect is, to put it at its mildest, untenable.
3. Petitioner's counsel invoked Santos v. Santos, 18 a 1952 decision. A more thorough
analysis ought to have cautioned him against reliance on such a case. It was therein clearly pointed
out that the government entity involved was originally the National Airports Corporation. Thereafter, it
"was abolished by Executive Order No. 365, series of 1950, and in its place and stead the Civil
Aeronautics Administration was created and took over all the assets and assumed all the liabilities of
the abolished corporation. The Civil Aeronautics Administration, even if it is not a juridical entity,
cannot legally prevent a party or parties from enforcing their proprietary rights under the cloak or
shield of lack of juridical personality, because to took over all the powers and assumed all the
obligations of the defunct corporation which had entered into the contract in question." 19 Then came
National Shipyard and Steel Corporation v. Court of Industrial Relations, 20 a 1963 decision, where
the then Justice, later Chief Justice, Concepcion, as ponente, stated that a government-owned and
controlled corporation "has a personality of its own distinct and separate from that of the
government.. . . Accordingly, it may sue and be sued and may be subjected to court processes just
like any other corporation. (Section 13, Act 1459, as amended)." 21 In three recent decisions,
Philippine National Bank v. Court of Industrial Relations, 22 Philippine National Bank v. Honorable
Judge Pabalan, 23 and Philippine National Railways v. Union de Maquinistas, 24 this constitutional
provision on non-suability was unavailing in view of the suit being against a government-owned or
controlled corporation. That point apparently escaped the attention of counsel for petitioner. Hence
Santos v. Santos is hardly controlling.
4. It is to be noted further that the trend against the interpretation sought to be fastened in
the broad language of Santos v. Santos is quite discernible. Not long after, in Araneta v. Hon. M.
Gatmaitan, 25 decided in 1957, it was held that an "action [against] Government officials, is
essentially one against the Government, . . .." 26 In the same year, this Court, in Angat River Irrigation
System v. Angat River Workers Union, 27 after referring to the "basic and fundamental principle of the
law that the Government cannot be sued before courts of justice without its consent," pointed out that
"this privilege of non-suability of the Government" covers with the mantle of its protection "an entity," in
this case, the Angat River Irrigation System. 28 Then, in 1960, came Lim v. Brownell, Jr., 29 where
there was a reaffirmation of the doctrine that a "claim [constituting] a charge against, or financial
liability to, the Government cannot be entertained by the courts except with the consent of said
government." 30 Bureau of Printing v. Bureau of Printing Employees Association 31 came a year later;
it reiterated such a doctrine. It was not surprising therefore that in 1966, Mobil Philippines Exploration,
Inc. was decided the way it was. The remedy, where the liability is based on contract, according to this
Court, speaking through Justice J. P. Bengzon, is for plaintiff to file a claim with the general office in
accordance with the controlling statute, Commonwealth Act No. 327. 32 To repeat, that doctrine has
been adhered to ever since. The latest case in point is Travelers Indemnity Company v. Barber
Steamship Lines, Inc. 33 Justice Aquino's opinion concluded with this paragraph: "It is settled that the
Bureau of Customs, acting as part of the machinery of the national government in the operation of the
arrastre service, is immune from suit under the doctrine of non-suability of the State. The claimant's
remedy to recover the loss or damage to the goods under the custody of the customs arrastre service
is to file a claim with the Commission in Audit as contemplated in Act No. 3083 and Commonwealth
Act No. 327." 34 With the explicit provision found in the present Constitution, the fundamental
principle of non-suability becomes even more exigent in its command. cdll
5. The reliance on Santos v. Santos as a prop for this petition having failed, it would
ordinarily follow that this suit cannot prosper. Nonetheless, as set forth at the outset, there is a novel
aspect that suffices to call for a contrary conclusion. It would be manifestly unfair for the Republic, as
donee, alleged to have violated the conditions under which it received gratuitously certain property,
thereafter to put as a barrier the concept of non-suitability. That would be a purely one-sided
arrangement offensive to one's sense of justice. Such conduct, whether proceeding from an individual
or governmental agency, is to be condemned. As a matter of fact, in case it is the latter that is culpable,
the affront to decency is even more manifest. The government, to paraphrase Justice Brandeis,
should set the example. If it is susceptible to the charge of having acted dishonorably, then it forfeits
public trust — and rightly so.
6. Fortunately, the constitutional provision itself allows a waiver. Where there is consent, a
suit may be filed. Consent need not be express. It can be implied. So it was more than implied in
Ministerio v. Court of First Instance of Cebu: 35 "The doctrine of governmental immunity from suit
cannot serve as an instrument for perpetrating an injustice on a citizen." 36 The fact that this decision
arose from a suit against the Public Highways Commissioner and the Auditor General for failure of the
government to pay for land necessary to widen a national highway, the defense of immunity without
the consent proving unavailing, is not material. The analogy is quite obvious. Where the government
ordinarily benefited by the taking of the land, the failure to institute the necessary condemnation
proceedings should not be a bar to an ordinary action for the collection of the just compensation due.
Here, the alleged failure to abide by the conditions under which a donation was given should not prove
an insuperable obstacle to a civil action, the consent likewise being presumed. This conclusion is
strengthened by the fact that while a donation partakes of a contract, there is no money claim, and
therefore reliance on Commonwealth Act No. 327 would be futile.
7. Our decision, it must be emphasized, goes no further than to rule that a donor, with the
Republic or any of its agency being the donee, is entitled to go to court in case of an alleged breach of
the conditions of such donation. He has the right to be heard. Under the circumstances, the
fundamental postulate of non-suability cannot stand in the way. It is made to accommodate itself to
 the demands of procedural due process, which is the negation of arbitrariness and inequity. The
government, in the final analysis, is the beneficiary. It thereby manifests its adherence to the highest
ethical standards, which can only be ignored at the risk of losing the confidence of the people, the
repository of the sovereign power. The judiciary under this circumstance has the grave responsibility
of living up to the ideal of objectivity and impartiality, the very essence of the rule of law. Only by
displaying the neutrality expected of an arbiter, even if it happens to be one of the departments of a
litigant, can the decision arrived at, whatever it may be, command respect and be entitled to
acceptance. llcd
WHEREFORE, the writ of certiorari prayed for is granted and the order of dismissal of
October 20, 1977 is nullified, set aside and declared to be without force and effect. The Court of First
Instance of Zamboanga City, Branch II, is hereby directed to proceed with this case, observing the
procedure set forth in the Rules of Court. No costs.
Barredo, Antonio, Aquino, Concepcion Jr., and Santos, JJ., concur.
||| (Santiago v. Republic, G.R. No. L-48214, [December 19, 1978], 176 PHIL 609-618)
 SECOND DIVISION
[G.R. No. 206484. June 29, 2016.]
DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS
(DOTC), petitioner, vs. SPOUSES VICENTE ABECINA and MARIA CLEOFE
ABECINA,respondents.
DECISION
BRION, J p:
This petition for review on certiorari seeks to reverse and set aside the March 20,
2013 decision of the Court of Appeals (CA) in CA-G.R. CV No. 93795 1affirming the decision of the
Regional Trial Court (RTC) of Daet, Camarines Norte, Branch 39, in Civil Case No. 7355. 2 The RTC
ordered the Department of Transportation and Communications (DOTC) to vacate the respondents'
properties and to pay them actual and moral damages.
ANTECEDENTS
Respondent spouses Vicente and Maria Cleofe Abecina (respondents/spouses
Abecina) are the registered owners of five parcels of land in Sitio Paltik, Barrio Sta. Rosa, Jose
Panganiban, Camarines Norte. The properties are covered by Transfer Certificates of Title (TCT) Nos.
T-25094, T-25095, T-25096, T-25097, and T-25098.3
In February 1993, the DOTC awarded Digitel Telecommunications Philippines,
Inc. (Digitel) a contract for the management, operation, maintenance, and development of a Regional
Telecommunications Development Project (RTDP) under the National Telephone Program, Phase I,
Tranche 1 (NTPI-1). 4
The DOTC and Digitel subsequently entered into several Facilities Management
Agreements (FMA) for Digitel to manage, operate, maintain, and develop the RTDP and NTPI-1
facilities comprising local telephone exchange lines in various municipalities in Luzon. The FMAs
were later converted into Financial Lease Agreements (FLA) in 1995.
Later on, the municipality of Jose Panganiban, Camarines Norte, donated a one thousand
two hundred (1,200) square-meter parcel of land to the DOTC for the implementation of the RDTP in
the municipality. However, the municipality erroneously included portions of the respondents' property
in the donation. Pursuant to the FLAs, Digitel constructed a telephone exchange on the property
which encroached on the properties of the respondent spouses. 5 SICDAa
Sometime in the mid-1990s, the spouses Abecina discovered Digitel's occupation over
portions of their properties. They required Digitel to vacate their properties and pay damages, but the
latter refused, insisting that it was occupying the property of the DOTC pursuant to their FLA.
On April 29, 2003, the respondent spouses sent a final demand letter to both the DOTC and
Digitel to vacate the premises and to pay unpaid rent/damages in the amount of one million two
hundred thousand pesos (P1,200,000.00). Neither the DOTC nor Digitel complied with the demand.
On September 3, 2003, the respondent spouses filed an accion
publiciana complaint 6 against the DOTC and Digitel for recovery of possession and damages. The
complaint was docketed as Civil Case No. 7355.
In its answer, the DOTC claimed immunity from suit and ownership over the subject
properties. 7 Nevertheless, during the pre-trial conference, the DOTC admitted that the Abecinas
were the rightful owners of the properties and opted to rely instead on state immunity from suit. 8
On March 12, 2007, the respondent spouses and Digitel executed a Compromise
Agreement and entered into a Contract of Lease. The RTC rendered a partial decision and approved
the Compromise Agreement on March 22, 2007. 9
On May 20, 2009, the RTC rendered its decision against the DOTC. 10 It brushed aside the
defense of state immunity. Citing Ministerio v. Court of First Instance11 and Amigable v. Cuenca, 12 it
held that government immunity from suit could not be used as an instrument to perpetuate an injustice
on a citizen. 13
The RTC held that as the lawful owners of the properties, the respondent spouses enjoyed
the right to use and to possess them — rights that were violated by the DOTC's unauthorized entry,
construction, and refusal to vacate. The RTC (1) ordered the Department — as a builder in bad faith
— to forfeit the improvements and vacate the properties; and (2) awarded the spouses with
P1,200,000.00 as actual damages, P200,000.00 as moral damages, and P200,000.00 as exemplary
damages plus attorney's fees and costs of suit.
The DOTC elevated the case to the CA arguing: (1) that the RTC never acquired jurisdiction
over it due to state immunity from suit; (2) that the suit against it should have been dismissed after the
spouses Abecina and Digitel executed a compromise agreement; and (3) that the RTC erred in
awarding actual, moral, and exemplary damages against it. 14 The appeal was docketed as CA-G.R.
CV No. 93795.
On March 20, 2013, the CA affirmed the RTC's decision but deleted the award of exemplary
damages. The CA upheld the RTC's jurisdiction over cases for accion publiciana where the assessed
value exceeds P20,000.00. 15 It likewise denied the DOTC's claim of state immunity from suit,
reasoning that the DOTC removed its cloak of immunity after entering into a proprietary contract —
the Financial Lease Agreement with Digitel. 16 It also adopted the RTC's position that state immunity
cannot be used to defeat a valid claim for compensation arising from an unlawful taking without the
proper expropriation proceedings. 17 The CA affirmed the award of actual and moral damages due to
the DOTC's neglect to verify the perimeter of the telephone exchange construction but found no valid
justification for the award of exemplary damages. 18
On April 16, 2013, the DOTC filed the present petition for review on certiorari.
THE PARTIES' ARGUMENTS
The DOTC asserts that its Financial Lease Agreement with Digitel was entered into in
pursuit of its governmental functions to promote and develop networks of communication
systems. 19 Therefore, it cannot be interpreted as a waiver of state immunity.
The DOTC also maintains that while it was regrettable that the construction of the telephone
exchange erroneously encroached on portions of the respondent's properties, the RTC erred in
ordering the return of the property. 20 It argues that while the DOTC, in good faith and in the
performance of its mandate, took private property without formal expropriation proceedings, the taking
was nevertheless an exercise of eminent domain. 21
 Citing the 2007 case of Heirs of Mateo Pidacan v. Air Transportation Office (ATO), 22 the
Department prays that instead of allowing recovery of the property, the case should be remanded to
the RTC for determination of just compensation.
On the other hand, the respondents counter that the state immunity cannot be invoked to
perpetrate an injustice against its citizens. 23 They also maintain that because the subject properties
are titled, the DOTC is a builder in bad faith who is deemed to have lost the improvements it
introduced. 24 Finally, they differentiate their case from Heirs of Mateo Pidacan v.
ATO because Pidacan originated from a complaint for payment of the value of the property and
rentals while their case originated from a complaint for recovery of possession and damages. 25
OUR RULING
We find no merit in the petition.
The State may not be sued without its consent. 26 This fundamental doctrine stems from
the principle that there can be no legal right against the authority which makes the law on which the
right depends. 27 This generally accepted principle of law has been explicitly expressed in both the
1973 28 and the present Constitutions.
But as the principle itself implies, the doctrine of state immunity is not absolute. The State
may waive its cloak of immunity and the waiver may be made expressly or by implication. DHIcET
Over the years, the State's participation in economic and commercial activities gradually
expanded beyond its sovereign function as regulator and governor. The evolution of the State's
activities and degree of participation in commerce demanded a parallel evolution in the traditional rule
of state immunity. Thus, it became necessary to distinguish between the State's sovereign and
governmental acts (jure imperii) and its private, commercial, and proprietary acts (jure gestionis).
Presently, state immunity restrictively extends only to acts jure imperii while acts jure gestionis are
considered as a waiver of immunity. 29
The Philippines recognizes the vital role of information and communication in nation
building. 30 As a consequence, we have adopted a policy environment that aspires for the full
development of communications infrastructure to facilitate the flow of information into, out of, and
across the country. 31 To this end, the DOTC has been mandated with the promotion, development,
and regulation of dependable and coordinated networks of communication. 32
The DOTC encroached on the respondents' properties when it constructed the local
telephone exchange in Daet, Camarines Norte. The exchange was part of the RTDP pursuant to the
National Telephone Program. We have no doubt that when the DOTC constructed the encroaching
structures and subsequently entered into the FLA with Digitel for their maintenance, it was carrying
out a sovereign function. Therefore, we agree with the DOTC's contention that these are acts jure
imperii that fall within the cloak of state immunity.
However, as the respondents repeatedly pointed out, this Court has long established
in Ministerio v. CFI, 33 Amigable v. Cuenca, 34 the 2010 case Heirs of Pidacan v. ATO, 35 and more
recently in Vigilar v. Aquino 36 that the doctrine of state immunity cannot serve as an instrument for
perpetrating an injustice to a citizen.
The Constitution identifies the limitations to the awesome and near-limitless powers of the
State. Chief among these limitations are the principles that no person shall be deprived of life, liberty,
or property without due process of law and that private property shall not be taken for public use
without just compensation.37 These limitations are enshrined in no less than the Bill of Rights that
guarantees the citizen protection from abuse by the State.
Consequently, our laws 38 require that the State's power of eminent domain shall be
exercised through expropriation proceedings in court. Whenever private property is taken for public
use, it becomes the ministerial duty of the concerned office or agency to initiate expropriation
proceedings. By necessary implication, the filing of a complaint for expropriation is a waiver of State
immunity.
If the DOTC had correctly followed the regular procedure upon discovering that it had
encroached on the respondents' property, it would have initiated expropriation proceedings instead of
insisting on its immunity from suit. The petitioners would not have had to resort to filing its complaint
for reconveyance. As this Court said in Ministerio:
It is unthinkable then that precisely because there was a failure to abide by what
the law requires, the government would stand to benefit. It is just as important, if
not more so, that there be fidelity to legal norms on the part of officialdom if the
rule of law were to be maintained. It is not too much to say that when the
government takes any property for public use, which is conditioned upon
the payment of just compensation, to be judicially ascertained, it makes
manifest that it submits to the jurisdiction of a court. There is no thought
then that the doctrine of immunity from suit could still be appropriately
invoked. 39 [emphasis supplied]
We hold, therefore, that the Department's entry into and taking of possession of the
respondents' property amounted to an implied waiver of its governmental immunity from suit.
We also find no merit in the DOTC's contention that the RTC should not have ordered the
reconveyance of the respondent spouses' property because the property is being used for a vital
governmental function, that is, the operation and maintenance of a safe and efficient communication
system. 40
The exercise of eminent domain requires a genuine necessity to take the property for public
use and the consequent payment of just compensation. The property is evidently being used for a
public purpose. However, we also note that the respondent spouses willingly entered into a lease
agreement with Digitel for the use of the subject properties.
If in the future the factual circumstances should change and the respondents refuse to
continue the lease, then the DOTC may initiate expropriation proceedings. But as matters now stand,
the respondents are clearly willing to lease the property. Therefore, we find no genuine necessity for
the DOTC to actually take the property at this point.
Lastly, we find that the CA erred when it affirmed the RTC's decision without deleting the
forfeiture of the improvements made by the DOTC through Digitel. Contrary to the RTC's findings, the
DOTC was not a builder in bad faith when the improvements were constructed. The CA itself found
that the Department's encroachment over the respondents' properties was a result of a mistaken
implementation of the donation from the municipality of Jose Panganiban. 41
Good faith consists in the belief of the builder that the land he is building on is his and [of] his
ignorance of any defect or flaw in his title. 42 While the DOTC later realized its error and admitted its
encroachment over the respondents' property, there is no evidence that it acted maliciously or in bad
faith when the construction was done. HcDSaT
Article 527 43 of the Civil Code presumes good faith. Without proof that the Department's
mistake was made in bad faith, its construction is presumed to have been made in good faith.
Therefore, the forfeiture of the improvements in favor of the respondent spouses is unwarranted.
WHEREFORE, we hereby DENY the petition for lack of merit. The May 20, 2009 decision
of the Regional Trial Court in Civil Case No. 7355, as modified by the March 20, 2013 decision of the
 Court of Appeals in CA-G.R. CV No. 93795, is AFFIRMED with further MODIFICATION that the
forfeiture of the improvements made by the DOTC in favor of the respondents is DELETED. No costs.
SO ORDERED.
||| (Department of Transportation and Communications v. Spouses Abecina, G.R. No. 206484, [June 29,
2016])
 EN BANC
[G.R. No. 85284. February 28, 1990.]
REPUBLIC OF THE PHILIPPINES, petitioner, vs. SANDIGANBAYAN, Third Division,
SIMPLICIO A. PALANCA in his own behalf as a stockholder of Bacolod Real Estate
Development Corporation (BREDCO), and other stockholders similarly
situated, respondents.
Hilado, Hagad & Hilado for private respondents.
SYLLABUS
1. REMEDIAL LAW; CIVIL PROCEDURE; MODES OF APPEAL; APPEAL DISTINGUISHED FROM
SPECIAL CIVIL ACTION. — The Rules of Court permit an aggrieved party, generally, to take a cause and
apply for relief with the appellate courts by way of either of two distinct and dissimilar modes — through the
broad process of appeal or the limited special civil action of certiorari. An appeal brings up for review errors
of judgment committed by a court of competent jurisdiction over the subject of the suit or the persons of the
parties or any such error committed by the court in the exercise of its jurisdiction amounting to nothing more
than an error of judgment. On the other hand, the writ of certiorari issues for the correction of errors of
jurisdiction only or grave abuse of discretion amounting to lack or excess of jurisdiction. The writ of
certiorari cannot legally be used for any other purpose. In terms of its function, the writ of certiorari serves to
keep a lower court within the bounds of its jurisdiction or to prevent it from committing such a grave abuse
of discretion amounting to excess of jurisdiction or to relieve parties from arbitrary acts of courts — acts
which courts have no power or authority in law to perform.
2. CONSTITUTIONAL LAW; SANDIGANBAYAN; HAS JURISDICTION NOT ONLY OVER PRINCIPAL
CASES OF THE PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT ON ILL-GOTTEN WEALTH
BUT ALSO ON ALL INCIDENTS RELATIVE THERETO. — The jurisdiction of the Sandiganbayan has
already been settled in Presidential Commission on Good Government vs. Hon. Emmanuel G. Pena, etc.,
et al. where the Court held that — ". . . Under Section 2 of the President's Executive Order No. 14issued on
May 7, 1986, all cases of the Commission regarding 'the funds, Moneys, Assets, and Properties Illegally
Acquired or Misappropriated by Former President Ferdinand Marcos, Mrs. Imelda Romualdez Marcos,
their Close Relatives, Subordinates, Business Associates, Dummies, Agents, or Nominees' whether civil or
criminal, are lodged within the 'exclusive and original jurisdiction of the Sandiganbayan' and all incidents
arising from, incidental to, or related to, such cases necessarily fall likewise under the Sandiganbayan's
exclusive and original jurisdiction, subject to review on certiorari exclusively by the Supreme Court."
(Emphasis supplied) In reiterating the aforequoted ruling in six (6) subsequent cases which were decided
jointly, again, the Court held that — ". . . the exclusive jurisdiction conferred on theSandiganbayan would
evidently extend not only to the principal causes of action, i.e., the recovery of alleged ill-gotten wealth, but
also to 'all incidents arising from, incidental to, or related to, such cases,' such as the dispute over the sale
of the shares, the propriety of the issuance of ancillary writs or provisional remedies relative thereto, the
sequestration thereof, which may not be made the subject of separate actions or proceedings in another
forum."
3. ID.; ID.; ID.; ACTION FOR INTERVENTION IS WITHIN THE ORIGINAL AND EXCLUSIVE
JURISDICTION OF SANDIGANBAYAN. — Intervention is not an independent action, but is ancillary and
supplemental to an existing litigation. Hence, the private respondents' action for intervention in Civil Case
No. 0025, not being an independent action, is merely incidental to, or related to, the said civil case. Since
the respondent Sandiganbayan has the exclusive and original jurisdiction over Civil Case No. 0025, it has
likewise original and exclusive jurisdiction over the private respondents' action for intervention therein.
4. REMEDIAL LAW; CIVIL PROCEDURE; SPECIAL CIVIL ACTION; CERTIORARI; ERROR IN THE
EXERCISE OF JURISDICTION IS NOT CORRECTIBLE BY CERTIORARI BUT BY APPEAL. — Now,
considering that respondent Sandiganbayan has jurisdiction not only over Civil Case No. 0025 but also
over the private respondents' action for intervention, any error or irregularity that it may have committed in
rendering its questioned resolutions, in the exercise of its jurisdiction, amounts to an error of judgment,
which is not correctible in the present petition for certiorari but by appeal.
5. ID.; ID.; ID.; ID.; ID.; HOWEVER, INSTANT CASE IS NOT DISMISSED AS ISSUE INVOLVES GREAT
PUBLIC INTEREST AND MATTER OF PUBLIC POLICY. — Accordingly, this case may be dismissed
outright without the Court having to pass upon the other issues raised in the petition, However, considering
that the litigation below is of great public interest and involves a matter of public policy, the Court has
decided to review the other errors allegedly committed by respondent court in rendering its questioned
resolutions.
6. ID.; ID.; INTERVENTION; WHEN A PERSON IS PERMITTED TO INTERVENE. — In this jurisdiction,
the law on "intervention" is found in the Rules of Court. Thus, a person may, before or during a trial, be
permitted by the court, in its discretion, to intervene in an action, if he has legal interest in the matter in
litigation, or in the success of either of the parties or an interest against both, or when he is so situated as to
be adversely affected by a distribution or other disposition of property in the custody of the court or of an
officer thereof.
7. ID.; ID.; ID.; INTERVENTION MAY BE MADE BY JOINING THE PLAINTIFF BY FILING A COMPLAINT
OR THE DEFENDANT BY FILING AN ANSWER. — The Rules of Court provide that the intervention shall
be made by complaint filed and served in regular form, and may be answered as if it where an original
complaint; but where the intervenor unites with the defendant in resisting the claims of the plaintiff, the
intervention may be made in the form of an answer to the complaint. In other words, a third person who
makes himself a party to an existing litigation, may either join the plaintiff in claiming what is sought in the
complaint, by filing a complaint in intervention, or by uniting with the defendant in resisting the claims of the
plaintiff, by filing an answer in intervention.
8. ID.; ID.; ID.; NOT A SUIT AGAINST THE STATE WHERE PRIVATE RESPONDENT DID NOT TAKE
THE INITIATIVE IN AN ACTION AGAINST IT. — In the present case, the private respondents intervened in
Civil Case No. 0025 merely to unite with the defendants therein in resisting the claims of petitioner, as
plaintiff, and for that reason asked for no affirmative relief against any party in their answer in
intervention. In other words, this is not a case where the private respondents take the initiative in an action
against petitioner by filing a complaint in intervention or a complaint. As observed by
respondent Sandiganbayan: "In intervening, Palanca and his co-stockholders have for their purpose to
exclude the BREDCO lots and stocks or, at least, their 35% interest in the BREDCO project from any
possible judgment directing reconveyance of the alleged ill-gotten wealth to the plaintiff. They do not pray
for damages against the latter. In effect, they occupy a defensive position as regards those shares of stock
or interest. The fact that they interjected themselves into his litigation at their own initiative does not alter
the essential nature of their intervention." Private respondents' action for intervention in Civil Case No.
0025 is not, therefore, a suit or counter-suit against petitioner Republic of the Philippines.
9. ID.; ID.; ID.; ID.; FACT THAT RESPONDENTS MERELY JOINED THE DEFENDANTS IN RESISTING
CLAIMS SUFFICES TO EXPLAIN THE JURISDICTION OFSANDIGANBAYAN. — Having arrived at the
above conclusions, the Court finds no need to further discuss the petitioner's pretense that the private
respondents' claims are claims as between and/or among Ferdinand and Imelda Marcos, et al., and that
the same is not cognizable by respondent Sandiganbayan but by the regular courts. It suffices to state that,
as already stated, in intervening in Civil Case No. 0025, private respondents merely joined the defendants
therein in resisting the claims of petitioner, as plaintiff, and that they asked no affirmative relief against any
party in their answer in intervention. They do not appear to have any controversy with the defendants,
Ferdinand and Imelda Marcos, et al.
RESOLUTION
PADILLA, J p:
This is a petition for CERTIORARI to annul and set aside the resolution of the Sandiganbayan (Third
Division), dated 3 June 1988, granting the private respondents' motion to intervene in Civil Case No. 0025
and admitting their answer in intervention, as well as its resolution, dated 25 August 1988, denying the
petitioner's motion for reconsideration; PROHIBITION to order the respondent court to cease and desist
from proceeding with the intervention filed with it; and alternatively, MANDAMUS to compel the respondent
court to dismiss the intervention case.
The antecedents are as follows:
On 29 July 1987, the Republic of the Philippines, as Plaintiff, through its governmental instrumentality the
Presidential Commission on Good Government (PCGG) filed with the respondent Sandiganbayan a
complaint against Ferdinand E. Marcos, et al. for reconveyance, reversion, accounting, restitution and
damages, docketed therein as Civil Case No. 0025 (PCGG No. 26). 1
On or about 3 September 1987, before the said Civil Case No. 0025 could be set for hearing, private
respondent Simplicio A. Palanca in his own behalf as a stockholder of Bacolod Real Estate Development
Corporation (BREDCO) and other stockholders similarly situated, filed with the
respondent Sandiganbayan a "Motion For Leave To Intervene" 2 attaching thereto their "Answer in
Intervention." 3
In their motion, private respondents alleged that they be —
". . . allowed to intervene in the present action and to file the Answer in intervention
hereto attached as Annex 'A', the said stockholders having a legal interest in the
matter in litigation and in the disposition of the properties listed in Annex 'A' of the
Complaint as 'BREDCO LOTS' and shares of stock in Bacolod Real Estate
Development Corporation.
"In justification, it is further respectfully alleged that:
"1. Close examination of the Complaint, in particular par. 12 thereto under 'V.
SPECIFIC AVERMENTS OF DEFENDANTS' ILLEGAL ACTS', makes no mention
at all about BREDCO being the subject of any anomalous transaction engaged in by
any of the defendants, in consequence of which the listed BREDCO lots could have
been gotten illegally. It is to be observed, on the other hand, that the titles
mentioned in aforesaid Annex of the complaint covering the lots in question are not
registered in the names of any of the defendants but in the name of Bacolod Real
Estate Development Corporation.
"2. Similarly, the shares of stock in Bacolod Real Estate Development Corporation
appearing under PERSONAL PROPERTY on page two of Annex 'A' of the
complaint are carried, not in the names of any of the defendants, but in the name of
Marsteel Consolidated, Inc. and were acquired under the circumstances averred
more in detail in the accompanying Answer in Intervention by reason of which said
shares should not be involved in the present action.
"3. If intervention is allowed, intervenors are prepared to prove that if ever any of the
defendants through Marsteel Consolidated, Inc. and Marsteel Corporation came to
have any interest in Bacolod Real Estate Development Corporation, it was only by
way of accommodation on the part of BREDCO stockholders who transferred their
shareholdings aggregating 70% of the subscribed capital to enable Marsteel
Consolidated to secure adequate financing for the reclamation and port
development project." 4
The foregoing allegations were further expanded and elaborated in the private respondents' Answer in
Intervention.
On 2 December 1987, petitioner filed its Reply 5 to Answer In Intervention, while private respondents filed
a "Rejoinder to Reply With Motion To Release BREDCO Lots" 6and also a "Motion To Calendar For
Hearing" the motion to release BREDCO lots. 7
On 22 January 1988, respondent court promulgated a resolution 8 holding in abeyance action on the
private respondents' "Rejoinder to Reply with Motion to Release BREDCO lots", and set the Motion for
Leave to Intervene for hearing on 2 February 1988. LLpr
On 11 March 1988, respondent court issued an order 9 giving petitioner fifteen (l5) days from 11 March
1988 within which to file its opposition and or comment on the motion to intervene and giving the private
respondents in turn ten (10) days within which to file their reply thereto.
On 23 March 1988, petitioner filed its Motion to Dismiss "Answer In Intervention," on the grounds that; (1)
respondent court lacks jurisdiction and (2) intervenors have no legal interest in the matter in
litigation, 10 which the private respondents opposed. 11
On 6 June 1988, respondent court promulgated a Resolution dated 3 June 1988 12 granting the private
respondents' motion to intervene and admitting their Answer in Intervention.
Petitioner moved for reconsideration but this was denied by respondent court in its resolution of 25 August
1989. 13
Hence, the instant petition.
The petitioner, through the Solicitor General, contends that in issuing the questioned resolutions granting
the Motion to Intervene and admitting the Answer-in-Intervention, respondent Sandiganbayan acted in
contravention of a national or public policy embedded in Executive Order Nos. 1, 2, 4 and related issuances,
or otherwise acted in a way not in accord with law or with the applicable decisions of this Court,
because: cdrep
(a) Petitioner, being the sovereign state, cannot be sued without its consent, and the Intervention is, in legal
effect, a suit or counter-suit against the sovereign state, the Republic of the Philippines;
(b) The cause of action of intervenors does not fall within the jurisdiction of the Sandiganbayan as
expressly spelled out in P.D. No. 1606 and Executive Order No. 14;
(c) Intervenors have no legal interest in the matter in litigation, and the subject matter is not in custodia
legis of respondent court; and
(d) Intervenors' claims, as contained in their Motion for Intervention and Answer-in-Intervention, are claims
between and or among Ferdinand and Imelda Marcos and their cronies, i.e., "members of their immediate
family close relatives, subordinates, and/or business associates, dummies, agents and nominees" and are
cognizable not by respondent court but by the regular courts or other fora. Even if there would be multiple
litigations, as among themselves, the legal effect remains, i.e., that there is only one case filed by
the Republic against the named defendants in Civil Case No. 0025, grounded on causes of action entirely
distinct from any cause of action which intervenors may have against Mr. Marcos and his cronies.
The petition is not impressed with merit.
The Rules of Court permit an aggrieved party, generally, to take a cause and apply for relief with the
appellate courts by way of either of two distinct and dissimilar modes — through the broad process of
appeal or the limited special civil action of certiorari. An appeal brings up for review errors of
judgment committed by a court of competent jurisdiction over the subject of the suit or the persons of the
parties or any such error committed by the court in the exercise of its jurisdiction amounting to nothing more
than an error of judgment. On the other hand, the writ of certiorari issues for the correction of errors of
jurisdiction only or grave abuse of discretion amounting to lack or excess of jurisdiction. The writ of
certiorari cannot legally be used for any other purpose. In terms of its function, the writ of certiorari serves to
keep a lower court within the bounds of its jurisdiction or to prevent it from committing such a grave abuse
of discretion amounting to excess of jurisdiction or to relieve parties from arbitrary acts of courts — acts
which courts have no power or authority in law to perform. 14
Hence, the main issue to be resolved in the present case, which is principally a petition for certiorari to
annul and set aside the questioned resolutions of respondent court is, whether or not
the Sandiganbayan has jurisdiction over the action for intervention, or if it has, whether respondent court
acted with grave abuse of discretion amounting to lack or excess of its jurisdiction in rendering the
questioned resolutions.
In the present case, petitioner merely contends that the cause of action of intervenors does not fall within
the jurisdiction of the Sandiganbayan as expressly spelled out in Presidential Decree No.
1606 and Executive Order No. 14; it does not claim that respondent court committed grave abuse of
discretion amounting to lack or excess of its jurisdiction in rendering the questioned resolutions.
The jurisdiction of the Sandiganbayan has already been settled in Presidential Commission on Good
Government vs. Hon. Emmanuel G. Pena, etc., et al. 15 where the Court held that —
". . . Under Section 2 of the President's Executive Order No. 14 issued on May 7,
1986, all cases of the Commission regarding 'the funds, Moneys, Assets, and
Properties Illegally Acquired or Misappropriated by Former President Ferdinand
Marcos, Mrs. Imelda Romualdez Marcos, their Close Relatives, Subordinates,
Business Associates, Dummies, Agents, or Nominees' whether civil or criminal, are
lodged within the 'exclusive and original jurisdiction of the Sandiganbayan' and all
incidents arising from, incidental to, or related to, such cases necessarily fall
likewise under the Sandiganbayan's exclusive and original jurisdiction, subject to
review on certiorari exclusively by the Supreme Court." (Emphasis supplied)
In reiterating the aforequoted ruling in six (6) subsequent cases 16 which were decided jointly, again, the
Court held that —
". . . the exclusive jurisdiction conferred on the Sandiganbayan would evidently
extend not only to the principal causes of action, i.e., the recovery of alleged
ill-gotten wealth, but also to 'all incidents arising from, incidental to, or related to,
such cases,' such as the dispute over the sale of the shares, the propriety of the
issuance of ancillary writs or provisional remedies relative thereto, the
sequestration thereof, which may not be made the subject of separate actions or
proceedings in another forum."
Intervention is not an independent action, but is ancillary and supplemental to an existing
litigation. 17 Hence, the private respondents' action for intervention in Civil Case No. 0025, not being an
independent action, is merely incidental to, or related to, the said civil case. Since the
respondent Sandiganbayan has the exclusive and original jurisdiction over Civil Case No. 0025, it has
likewise original and exclusive jurisdiction over the private respondents' action for intervention therein.
Now, considering that respondent Sandiganbayan has jurisdiction not only over Civil Case No. 0025 but
also over the private respondents' action for intervention, any error or irregularity that it may have
committed in rendering its questioned resolutions, in the exercise of its jurisdiction, amounts to an error of
judgment, which is not correctible in the present petition for certiorari but by appeal.
Accordingly, this case may be dismissed outright without the Court having to pass upon the other issues
raised in the petition, However, considering that the litigation below is of great public interest and involves a
matter of public policy, the Court has decided to review the other errors allegedly committed by respondent
court in rendering its questioned resolutions. LLphil
In this jurisdiction, the law on "intervention" is found in the Rules of Court. 18 Thus, a person may, before or
during a trial, be permitted by the court, in its discretion, to intervene in an action, if he has legal interest in
the matter in litigation, or in the success of either of the parties or an interest against both, or when he is so
situated as to be adversely affected by a distribution or other disposition of property in the custody of the
court or of an officer thereof. 19
The Court is not impressed with the contention of petitioner that the intervenors have no legal interest in the
matter in litigation. In this connection, it would suffice to quote what the respondent court said in holding that
the intervenors have a legal interest in the matter in litigation. Thus —
"Has Palanca shown a proper case for intervention by him and his co-stockholders
who are similarly situated as he is?
A narration of the pertinent facts alleged by Palanca and the plaintiff indicates the
answer.
In 1961, BREDCO was awarded by Bacolod City a contract to
undertake the reclamation and port development of the city. As of 1975, a
sizeable portion of land had already been reclaimed from the sea and
corresponding torrens titles issued in BREDCO's name.
In that year, BREDCO engaged MARSTEEL as a contractor to
complete the project with power to negotiate in its name or jointly and or
severally with BREDCO for loans to finance the reclamation and port
development, and to mortgage all reclaimed lots and other assets of the
project as security. For its services, MARSTEEL shall receive 65% of the
excess of all revenues over all disbursements. Accordingly, BREDCO
 conveyed to MARSTEEL 65% of each lot already reclaimed and that to
be reclaimed.
In 1977, MARSTEEL assigned to MCI, which owned 100% of
its capital stock, all its rights, interests, obligations, and undertakings in
the project. To enable MCI to expand its base of negotiation for loans
needed in the reclamation and port development, the BREDCO
stockholders transferred to MCI their respective shares of stock
amounting to 70% of the capital stock of BREDCO. In return, they 'shall
be entitled to a share of 35% in excess of all revenues over all
disbursements of the projects,' it being 'understood that payment of the
corresponding share shall be due to BREDCO stockholders as owners of
existing interests in the project, regardless of the fact that by
implementation of this AGREEMENT, they ceased to be stockholders of
BREDCO.'
In September 1986, the Presidential Commission on Good
Government (PCGG) sequestered 'all assets, properties, records and
documents' of MARSTEEL, MCI, and BREDCO'. In July 1987, the
complaint at bar was filed and expanded in March 1988. The pleadings,
original and expanded, allege that the defendants, acting singly or
collectively, amassed ill-gotten wealth listed in Annex 'A' thereof, among
which are the BREDCO lots and shares of stock, and pray that the
ill-gotten wealth be reconveyed to the plaintiff, plus damages.
Significantly, however, the bodies of the complaints do not mention
anything about BREDCO, its project, lots, and stocks, nor about MCI.
Under these alleged facts, Palanca has established a proper case for intervention.
Firstly, he and his co-stockholders have a legal interest in the matter in litigation,
namely, their 70% of the capital stock of BREDCO, which they transferred to MCI by
way of alleged accommodation, or its equivalent of 35% of the excess of all
revenues over all disbursements, to which they are entitled 'as owners of existing
interests in the project.' Section 2, Rule 12, Revised Rules of Court, provides that a
person may be permitted 'to intervene in an action, if he has legal interest in the
matter in litigation.'
'As a general rule the right to intervene exists in favor of one
who claims to be the owner or to have some interest in the property which
is the subject of litigation, and this without particular regard to the value of
the property or the right claimed therein. A third party may intervene in a
sequestration suit involving title to personal property, and have his claims
to the possession of the property vindicated therein. So, in an action for
possession of real or personal property, an intervenor may be admitted
on the ground that he is an owner thereof, either to assist in the defense,
or to claim the property for himself, or to obtain some other relief germane
to the action.' (59 Am Jur 2d, Parties, Sec. 152, p. 585)
Secondly, the same Section 2, Rule 12, further provides that intervention by a
person may be permitted 'when he is so situated as to be adversely affected by a
The petitioner's contention that the State cannot be sued without its consent and that private respondents'
distribution or other disposition of property in the custody of the court or of an officer
action for intervention is, in legal effect, a suit or counter suit against the sovereign is also untenable. Cdpr
thereof.' On this point, the Supreme Court observed: LexLib
The Rules of Court 21 provide that the intervention shall be made by complaint filed and served in regular
form, and may be answered as if it where an original complaint; but where the intervenor unites with the
'We shall now speak of the case where the stranger desires to
intervene for the purpose of asserting a property right in the res, or thing,
which is the subject matter of the litigation, without becoming a formal
plaintiff or defendant, and without acquiring the control over the course of
a litigation, which is conceded to the main actions (sic) therein. The mode
of intervention to which reference is now made is denominated in equity
procedure the intervention pro interesse suo and is somewhat analogous
to the trial of a right of property in an action of law, its purpose being to
enable a person whose property gets into the clutches of a court, in a
controversy between others, to go into court and to procure it or its
proceeds to be surrendered to him. It often happens that a person who
really owns property, or has a superior lien or other interest in it, sees a
litigation spring up between others who assert rights in or concerning it. If
the court takes possession of the res, or otherwise gets jurisdiction over it
in such a controversy, the real owner is not compelled to stand idly by and
see the property disposed of without asserting his rights. Though it be
granted that the litigation would not be technically binding on him,
because of his not being a party, yet it might well happen that
complications would ensue whereby his rights would be materially
prejudiced. For instance, the subject-matter of the litigation might consist
of a fund to be distributed, and the conditions might be such that if it were
turned over to the particular litigant who should appear to have the better
right in the original action, the person really having a superior title might
be left without redress. Accordingly provision is made whereby persons
who have not been joined as parties in the original proceedings may
intervene and assert a right antagonistic or superior to that of one or both
of the parties. (Bosworth vs. Terminal etc. Assoc. of St. Louis, 174 U.S.
182, 187, 43 L. ed., 941, 943). As regards the right to intervene in this
manner, it may be stated that if the party desiring to intervene shows a
legitimate and proper interest in the fund or property in question, the
motion to intervene should be granted, especially if such interest cannot
be otherwise properly protected.' (Joaquin v. Herrera, 37 Phil. 705,
722-724)
Here, the BREDCO lots and stocks were sequestered and are now in custodia
legis (Bernas, The Constitution of the Republic of the Philippines, An Annotated
Text, 1987 ed., p. 129, footnote 42). From the facts averred by Palanca and the
plaintiff, it is easy to see that in the event We decide to order the reconveyance of
those assets to the plaintiff, Palanca and his co-stockholders in BREDCO stand to
be adversely affected.
And thirdly, the legal interest of Palanca and his co-stockholders in the matter in
litigation and the possibility of a judgment ordering reconveyance in favor of the
plaintiff, invest them with legal interest in the success of the defendants, at least
insofar as the BREDCO lots and shares are concerned. Section 2, Rule 12, also
permits intervention by a person who has legal interest in the success of either of
the parties." 20
defendant in resisting the claims of the plaintiff, the intervention may be made in the form of an answer to
the complaint. In other words, a third person who makes himself a party to an existing litigation, may either
join the plaintiff in claiming what is sought in the complaint, by filing a complaint in intervention, or by uniting
with the defendant in resisting the claims of the plaintiff, by filing an answer in intervention.
In Froilan v. Pan Oriental Shipping Co., 22 the plaintiff therein Fernando A. Froilan filed a complaint against
the defendant, Pan Oriental Shipping Co. The Republic of the Philippines intervened by filing a complaint in
intervention. Thereafter, the defendant filed its answer to the complaint in intervention, and set up a
counterclaim against the Republic of the Philippines. The trial court dismissed the defendant's
counterclaim against the Republic on the ground, among others, that the state is immune from suit. On
appeal, this Court held that the dismissal of the counterclaim was untenable, because by filing its complaint
in intervention the Government in effect waived its right to non-suability.
In another case, Lim vs. Brownell, Jr. and Kagawa, 23 the plaintiff Benito E. Lim, as administrator of the
intestate estate of Arsenia Enriquez, filed a complaint in the Court of First Instance of Manila against the
Alien Property Administrator (later substituted by the Attorney General of the United States) for the
recovery of four (4) parcels of land (which were subsequently transferred to the Republic of the Philippines)
with a prayer for the payment of back rentals. The Republic of the Philippines intervened in the case. The
defendant Attorney General of the United States and the defendant-intervenor Republic of the Philippines
each filed an answer, alleging by way of affirmative defense, among others, that the lower court had no
jurisdiction over the claim for rentals since the action in that regard constituted a suit against theRepublic to
which it had not given its consent. The trial court dismissed the complaint for lack of jurisdiction. On appeal,
this Court affirmed, with the following reasons:
from any possible judgment directing reconveyance of the alleged ill-gotten wealth
to the plaintiff. They do not pray for damages against the latter. In effect, they
occupy a defensive position as regards those shares of stock or interest. The fact
that they interjected themselves into his litigation at their own initiative does not alter
the essential nature of their intervention." 24
Private respondents' action for intervention in Civil Case No. 0025 is not, therefore, a suit or counter-suit
against petitioner Republic of the Philippines.
Having arrived at the above conclusions, the Court finds no need to further discuss the petitioner's pretense
that the private respondents' claims are claims as between and/or among Ferdinand and Imelda Marcos, et
al., and that the same is not cognizable by respondent Sandiganbayan but by the regular courts. It suffices
to state that, as already stated, in intervening in Civil Case No. 0025, private respondents merely joined the
defendants therein in resisting the claims of petitioner, as plaintiff, and that they asked no affirmative relief
against any party in their answer in intervention. They do not appear to have any controversy with the
defendants, Ferdinand and Imelda Marcos, et al. LLpr
ACCORDINGLY, the petition in the present case is hereby DISMISSED.
SO ORDERED.
||| (Republic v. Sandiganbayan, G.R. No. 85284 (Resolution), [February 28, 1990], 261 PHIL 1078-1095)

"The claim for damages for the use of the property against the intervenor
defendant Republic of the Philippines to which it was transferred, likewise, cannot
be maintained because of the immunity of the state from suit. The claim obviously
constitutes a charge against, or financial liability to, the Government and
consequently cannot be entertained by the courts except with the consent of said
government. (Syquia vs. Almeda Lopez, 84 Phil. 312; 47 Off. Gaz., 665; Compania
General de Tabacos vs. Gov't. of the PI, 45 Phil., 663). Plaintiff argues that by its
intervention, the Republic of the Philippines, in effect, waived its right of
non-suability, but it will be remembered that the Republic intervened in the case
merely to unite with the defendant Attorney General of the United States in resisting
plaintiff's claims, and for that reason asked no affirmative relief against any party in
the answer in intervention. . . . Clearly, this is not a case where the State takes the
initiative in an action against a private party by filing a complaint in intervention,
thereby surrendering its privileged position and coming down to the level of the
defendant — as what happened in the case of Froilan vs. Pan Oriental Shipping Co.,
et al. — 95 Phil. 905 cited by the plaintiff — but one where the State, as one of the
defendants merely resisted a claim against it precisely on the ground, among others,
of its privileged position which exempts it from suit." (emphasis supplied)

In the present case, the private respondents intervened in Civil Case No. 0025 merely to unite with the
defendants therein in resisting the claims of petitioner, as plaintiff, and for that reason asked for no
affirmative relief against any party in their answer in intervention. In other words, this is not a case where
the private respondents take the initiative in an action against petitioner by filing a complaint in intervention
or a complaint. As observed by respondent Sandiganbayan: llcd

"In intervening, Palanca and his co-stockholders have for their purpose to exclude
the BREDCO lots and stocks or, at least, their 35% interest in the BREDCO project
 EN BANC
[G.R. No. 206510. September 16, 2014.]
MOST REV. PEDRO D. ARIGO, Vicar Apostolic of Puerto Princesa D.D.; MOST
REV. DEOGRACIAS S. INIGUEZ, JR., Bishop-Emeritus of Caloocan,
FRANCES Q. QUIMPO, CLEMENTE G. BAUTISTA, JR., Kalikasan-PNE, MARIA
CAROLINA P. ARAULLO, RENATO M. REYES, JR., Bagong Alyansang
Makabayan, HON. NERI JAVIER COLMENARES, Bayan Muna Party-list,
ROLAND G. SIMBULAN, PH.D., Junk VFA Movement, TERESITA R. PEREZ,
PH.D., HON. RAYMOND V. PALATINO, Kabataan Party-list, PETER SJ.
GONZALES, Pamalakaya, GIOVANNI A. TAPANG, PH. D., Agham, ELMER C.
LABOG, Kilusang Mayo Uno, JOAN MAY E. SALVADOR, Gabriela, JOSE
ENRIQUE A. AFRICA, THERESA A. CONCEPCION, MARY JOAN A. GUAN,
NESTOR T. BAGUINON, PH.D., A. EDSEL F. TUPAZ, petitioners, vs. SCOTT H.
SWIFT in his capacity as Commander of the U.S. 7th Fleet, MARK A. RICE in
his capacity as Commanding Officer of the USS Guardian, PRESIDENT
BENIGNO S. AQUINO III in his capacity as Commander-in-Chief of the Armed
Forces of the Philippines, HON. ALBERT F. DEL ROSARIO, Secretary,
Department of Foreign Affairs, HON. PAQUITO OCHOA, JR., Executive
Secretary, Office of the President, HON. VOLTAIRE T. GAZMIN, Secretary,
Department of National Defense, HON. RAMON JESUS P. PAJE, Secretary,
Department of Environment and Natural Resources, VICE ADMIRAL JOSE
LUIS M. ALANO, Philippine Navy Flag Officer in Command, Armed Forces of
the Philippines, ADMIRAL RODOLFO D. ISORENA, Commandant, Philippine
Coast Guard, COMMODORE ENRICO EFREN EVANGELISTA, Philippine
Coast Guard Palawan, MAJOR GEN. VIRGILIO O. DOMINGO, Commandant of
Armed Forces of the Philippines Command and LT. GEN. TERRY G.
ROBLING, US Marine Corps Forces, Pacific and Balikatan 2013 Exercise
Co-Director, respondents.
DECISION
VILLARAMA, JR., J p:
Before us is a petition for the issuance of a Writ of Kalikasan with prayer for the issuance of
a Temporary Environmental Protection Order (TEPO) under Rule 7 of A.M. No. 09-6-8-SC, otherwise
known as the Rules of Procedure for Environmental Cases (Rules), involving violations of
environmental laws and regulations in relation to the grounding of the US military ship USS
Guardian over the Tubbataha Reefs.
Factual Background
The name "Tubbataha" came from the Samal (seafaring people of southern Philippines)
language which means "long reef exposed at low tide." Tubbataha is composed of two huge coral
atolls — the north atoll and the south atoll — and the Jessie Beazley Reef, a smaller coral structure
about 20 kilometers north of the atolls. The reefs of Tubbataha and Jessie Beazley are considered
part of Cagayancillo, a remote island municipality of Palawan. 1
In 1988, Tubbataha was declared a National Marine Park by virtue of Proclamation No.
306 issued by President Corazon C. Aquino on August 11, 1988. Located in the middle of Central
Sulu Sea, 150 kilometers southeast of Puerto Princesa City, Tubbataha lies at the heart of the Coral
Triangle, the global center of marine biodiversity.
In 1993, Tubbataha was inscribed by the United Nations Educational Scientific and Cultural
Organization (UNESCO) as a World Heritage Site. It was recognized as one of the Philippines' oldest
ecosystems, containing excellent examples of pristine reefs and a high diversity of marine life. The
97,030-hectare protected marine park is also an important habitat for internationally threatened and
endangered marine species. UNESCO cited Tubbataha's outstanding universal value as an important
and significant natural habitat for in situ conservation of biological diversity; an example representing
significant on-going ecological and biological processes; and an area of exceptional natural beauty
and aesthetic importance. 2
On April 6, 2010, Congress passed Republic Act (R.A.) No. 10067, 3 otherwise known as
the "Tubbataha Reefs Natural Park (TRNP) Act of 2009" "to ensure the protection and conservation of
the globally significant economic, biological, sociocultural, educational and scientific values of the
Tubbataha Reefs into perpetuity for the enjoyment of present and future generations." Under the
"no-take" policy, entry into the waters of TRNP is strictly regulated and many human activities are
prohibited and penalized or fined, including fishing, gathering, destroying and disturbing the resources
within the TRNP. The law likewise created the Tubbataha Protected Area Management Board
(TPAMB) which shall be the sole policy-making and permit-granting body of the TRNP.
The USS Guardian is an Avenger-class mine countermeasures ship of the US Navy. In
December 2012, the US Embassy in the Philippines requested diplomatic clearance for the said
vessel "to enter and exit the territorial waters of the Philippines and to arrive at the port of Subic Bay
for the purpose of routine ship replenishment, maintenance, and crew liberty." 4 On January 6, 2013,
the ship left Sasebo, Japan for Subic Bay, arriving on January 13, 2013 after a brief stop for fuel in
Okinawa, Japan.
On January 15, 2013, the USS Guardian departed Subic Bay for its next port of call in
Makassar, Indonesia. On January 17, 2013 at 2:20 a.m. while transiting the Sulu Sea, the ship ran
aground on the northwest side of South Shoal of the Tubbataha Reefs, about 80 miles east-southeast
of Palawan. No one was injured in the incident, and there have been no reports of leaking fuel or oil.
On January 20, 2013, U.S. 7th Fleet Commander, Vice Admiral Scott Swift, expressed
regret for the incident in a press statement. 5 Likewise, US Ambassador to the Philippines Harry K.
Thomas, Jr., in a meeting at the Department of Foreign Affairs (DFA) on February 4, "reiterated his
regrets over the grounding incident and assured Foreign Affairs Secretary Albert F. del Rosario that
the United States will provide appropriate compensation for damage to the reef caused by the
ship." 6 By March 30, 2013, the US Navy-led salvage team had finished removing the last piece of the
grounded ship from the coral reef. CDcaSA
On April 17, 2013, the above-named petitioners on their behalf and in representation of their
respective sector/organization and others, including minors or generations yet unborn, filed the
present petition against Scott H. Swift in his capacity as Commander of the US 7th Fleet, Mark A. Rice
in his capacity as Commanding Officer of the USS Guardian and Lt. Gen. Terry G. Robling, US
Marine Corps Forces, Pacific and Balikatan 2013 Exercises Co-Director ("US respondents");
President Benigno S. Aquino III in his capacity as Commander-in-Chief of the Armed Forces of the
Philippines (AFP), DFA Secretary Albert F. Del Rosario, Executive Secretary Paquito Ochoa, Jr.,
Secretary Voltaire T. Gazmin (Department of National Defense), Secretary Jesus P. Paje
(Department of Environment and Natural Resources), Vice-Admiral Jose Luis M. Alano (Philippine
Navy Flag Officer in Command, AFP), Admiral Rodolfo D. Isorena (Philippine Coast Guard
Commandant), Commodore Enrico Efren Evangelista (Philippine Coast Guard-Palawan), and Major
General Virgilio O. Domingo (AFP Commandant), collectively the "Philippine respondents."
The Petition
Petitioners claim that the grounding, salvaging and post-salvaging operations of the USS
Guardian cause and continue to cause environmental damage of such magnitude as to affect the
provinces of Palawan, Antique, Aklan, Guimaras, Iloilo, Negros Occidental, Negros Oriental,
Zamboanga del Norte, Basilan, Sulu, and Tawi-Tawi, which events violate their constitutional rights to
a balanced and healthful ecology. They also seek a directive from this Court for the institution of civil,
administrative and criminal suits for acts committed in violation of environmental laws and regulations
in connection with the grounding incident.
Specifically, petitioners cite the following violations committed by US respondents under
R.A. No. 10067: unauthorized entry (Section 19); non-payment of conservation fees (Section 21);
obstruction of law enforcement officer (Section 30); damages to the reef (Section 20); and destroying
and disturbing resources (Section 26 [g]). Furthermore, petitioners assail certain provisions of the
Visiting Forces Agreement (VFA) which they want this Court to nullify for being unconstitutional.
The numerous reliefs sought in this case are set forth in the final prayer of the petition, to
wit:
WHEREFORE, in view of the foregoing, Petitioners respectfully pray that
the Honorable Court:
1. Immediately issue upon the filing of this petition a Temporary Environmental
Protection Order (TEPO) and/or a Writ of Kalikasan, which shall, in
particular,
a. Order Respondents and any person acting on their behalf, to cease
and desist all operations over the Guardian
grounding incident;
b. Initially demarcating the metes and bounds of the damaged area as
well as an additional buffer zone;
c. Order Respondents to stop all port calls and war games under
'Balikatan' because of the absence of clear guidelines, duties,
and liability schemes for breaches of those duties, and require
Respondents to assume responsibility for prior and future
environmental damage in general, and environmental damage
under the Visiting Forces Agreement in particular.
d. Temporarily define and describe allowable activities of ecotourism,
diving, recreation, and limited commercial activities by
fisherfolk and indigenous communities near or around the
TRNP but away from the damaged site and an additional buffer
zone; ISCDEA
2. After summary hearing, issue a Resolution extending the TEPO until further
orders of the Court;
3. After due proceedings, render a Decision which shall include, without limitation:
a. Order Respondents Secretary of Foreign Affairs, following the
dispositive portion of Nicolas v. Romulo, "to forthwith negotiate
with the United States representatives for the appropriate
agreement on [environmental guidelines and environmental
accountability] under Philippine authorities as provided in Art.
V[ ] of the VFA. . ."
b. Direct Respondents and appropriate agencies to commence
administrative, civil, and criminal proceedings against erring
officers and individuals to the full extent of the law, and to make
such proceedings public;
c. Declare that Philippine authorities may exercise primary and exclusive
criminal jurisdiction over erring U.S. personnel under the
circumstances of this case;
d. Require Respondents to pay just and reasonable compensation in the
settlement of all meritorious claims for damages caused to the
Tubbataha Reef on terms and conditions no less severe than
those applicable to other States, and damages for personal
injury or death, if such had been the case;
e. Direct Respondents to cooperate in providing for the attendance of
witnesses and in the collection and production of evidence,
including seizure and delivery of objects connected with the
offenses related to the grounding of the Guardian;
f. Require the authorities of the Philippines and the United States to notify
each other of the disposition of all cases, wherever heard,
related to the grounding of the Guardian;
g. Restrain Respondents from proceeding with any purported restoration,
repair, salvage or post salvage plan or plans, including cleanup
plans covering the damaged area of the Tubbataha
Reef absent a just settlement approved by the Honorable
Court;
h. Require Respondents to engage in stakeholder and LGU consultations
in accordance with the Local Government Code and R.A.
10067;
i. Require Respondent US officials and their representatives to place a
deposit to the TRNP Trust Fund defined under Section 17 of
RA 10067 as a bona fidegesture towards full reparations;
j. Direct Respondents to undertake measures to rehabilitate the areas
affected by the grounding of the Guardian in light of
Respondents' experience in thePort Royale grounding in 2009,
among other similar grounding incidents;
k. Require Respondents to regularly publish on a quarterly basis and in
the name of transparency and accountability
such environmental damage assessment, valuation, and
valuation methods, in all stages of negotiation;
 l. Convene a multisectoral technical working group to provide scientific
and technical support to the TPAMB;
m. Order the Department of Foreign Affairs, Department of National
Defense, and the Department of Environment and Natural
Resources to review the Visiting Forces Agreement and the
Mutual Defense Treaty to consider whether their provisions
allow for the exercise of erga omnes rights to a balanced and
healthful ecology and for damages which follow from any
violation of those rights;
n. Narrowly tailor the provisions of the Visiting Forces Agreement for
purposes of protecting the damaged areas of TRNP; ADHaTC
o. Declare the grant of immunity found in Article V ("Criminal Jurisdiction")
and Article VI of the Visiting Forces Agreement
unconstitutional for violating equal protection and/or for
violating the preemptory norm of nondiscrimination
incorporated as part of the law of the land under Section 2,
Article II, of thePhilippine Constitution;
p. Allow for continuing discovery measures;
q. Supervise marine wildlife rehabilitation in the Tubbataha Reefs in all
other respects; and
4. Provide just and equitable environmental rehabilitation measures and such other
reliefs as are just and equitable under the premises. 7 (Underscoring
supplied.)
Since only the Philippine respondents filed their comment 8 to the petition, petitioners also
filed a motion for early resolution and motion to proceed ex parteagainst the US respondents. 9
Respondents' Consolidated Comment
In their consolidated comment with opposition to the application for a TEPO and ocular
inspection and production orders, respondents assert that: (1) the grounds relied upon for the
issuance of a TEPO or writ of Kalikasan have become fait accompli as the salvage operations on
the USS Guardian were already completed; (2) the petition is defective in form and substance; (3) the
petition improperly raises issues involving the VFA between the Republic of the Philippines and the
United States of America; and (4) the determination of the extent of responsibility of the US
Government as regards the damage to the Tubbataha Reefs rests exclusively with the executive
branch.
The Court's Ruling
As a preliminary matter, there is no dispute on the legal standing of petitioners to file the
present petition.
Locus standi is "a right of appearance in a court of justice on a given
question." 10 Specifically, it is "a party's personal and substantial interest in a case where he has
sustained or will sustain direct injury as a result" of the act being challenged, and "calls for more than
just a generalized grievance." 11 However, the rule on standing is a procedural matter which this
Court has relaxed for non-traditional plaintiffs like ordinary citizens, taxpayers and legislators when
the public interest so requires, such as when the subject matter of the controversy is of transcendental
importance, of overreaching significance to society, or of paramount public interest. 12
In the landmark case of Oposa v. Factoran, Jr., 13 we recognized the "public right" of
citizens to "a balanced and healthful ecology which, for the first time in our constitutional history, is
solemnly incorporated in the fundamental law." We declared that the right to a balanced and healthful
ecology need not be written in theConstitution for it is assumed, like other civil and political rights
guaranteed in the Bill of Rights, to exist from the inception of mankind and it is an issue of
transcendental importance with intergenerational implications. Such right carries with it the correlative
duty to refrain from impairing the environment. 14
On the novel element in the class suit filed by the petitioners minors in Oposa, this Court
ruled that not only do ordinary citizens have legal standing to sue for the enforcement of
environmental rights, they can do so in representation of their own and future generations.
Thus: SaHcAC
Petitioners minors assert that they represent their generation as well as
generations yet unborn. We find no difficulty in ruling that they can, for themselves,
for others of their generation and for the succeeding generations, file a class
suit. Their personality to sue in behalf of the succeeding generations can only
be based on the concept of intergenerational responsibility insofar as the
right to a balanced and healthful ecology is concerned. Such a right, as
hereinafter expounded, considers the "rhythm and harmony of nature." Nature
means the created world in its entirety. Such rhythm and harmony indispensably
include, inter alia, the judicious disposition, utilization, management, renewal and
conservation of the country's forest, mineral, land, waters, fisheries, wildlife,
off-shore areas and other natural resources to the end that their exploration,
development and utilization be equitably accessible to the present as well as future
generations. Needless to say, every generation has a responsibility to the next to
preserve that rhythm and harmony for the full enjoyment of a balanced and healthful
ecology. Put a little differently, the minors' assertion of their right to a sound
environment constitutes, at the same time, the performance of their obligation to
ensure the protection of that right for the generations to come. 15 (Emphasis
supplied.)
The liberalization of standing first enunciated in Oposa, insofar as it refers to minors and
generations yet unborn, is now enshrined in the Rules which allows the filing of a citizen suit in
environmental cases. The provision on citizen suits in the Rules "collapses the traditional rule on
personal and direct interest, on the principle that humans are stewards of nature." 16
Having settled the issue of locus standi, we shall address the more fundamental question of
whether this Court has jurisdiction over the US respondents who did not submit any pleading or
manifestation in this case.
The immunity of the State from suit, known also as the doctrine of sovereign immunity or
non-suability of the State, 17 is expressly provided in Article XVI of the1987 Constitution which states:
Section 3. The State may not be sued without its consent.
In United States of America v. Judge Guinto, 18 we discussed the principle of state
immunity from suit, as follows:
The rule that a state may not be sued without its consent, now expressed
in Article XVI, Section 3, of the 1987 Constitution, is one of the generally accepted
principles of international law that we have adopted as part of the law of our land
under Article II, Section 2. . . . .
 Even without such affirmation, we would still be bound by the generally
accepted principles of international law under the doctrine of incorporation. Under
this doctrine, as accepted by the majority of states, such principles are deemed
incorporated in the law of every civilized state as a condition and consequence of its
membership in the society of nations. Upon its admission to such society, the state
is automatically obligated to comply with these principles in its relations with other
states.
As applied to the local state, the doctrine of state immunity is based on
the justification given by Justice Holmes that "there can be no legal right against the
authority which makes the law on which the right depends." [Kawanakoa v.
Polybank, 205 U.S. 349] There are other practical reasons for the enforcement of
the doctrine. In the case of the foreign state sought to be impleaded in the
local jurisdiction, the added inhibition is expressed in the maxim par in
parem, non habet imperium. All states are sovereign equals and cannot
assert jurisdiction over one another. A contrary disposition would, in the
language of a celebrated case, "unduly vex the peace of nations." [De Haber v.
Queen of Portugal, 17 Q. B. 171]
While the doctrine appears to prohibit only suits against the state without
its consent, it is also applicable to complaints filed against officials of the state
for acts allegedly performed by them in the discharge of their duties. The rule
is that if the judgment against such officials will require the state itself to perform an
affirmative act to satisfy the same, such as the appropriation of the amount needed
to pay the damages awarded against them, the suit must be regarded as against
the state itself although it has not been formally impleaded. [Garcia v. Chief of
Staff, 16 SCRA 120] In such a situation, the state may move to dismiss the
complaint on the ground that it has been filed without its consent. 19 (Emphasis
supplied.) aEcDTC
Under the American Constitution, the doctrine is expressed in the Eleventh Amendment
which reads:
The Judicial power of the United States shall not be construed to extend
to any suit in law or equity, commenced or prosecuted against one of the United
States by Citizens of another State, or by Citizens or Subjects of any Foreign State.
In the case of Minucher v. Court of Appeals, 20 we further expounded on the immunity of
foreign states from the jurisdiction of local courts, as follows:
The precept that a State cannot be sued in the courts of a foreign state is
a long-standing rule of customary international law then closely identified with the
personal immunity of a foreign sovereign from suit and, with the emergence of
democratic states, made to attach not just to the person of the head of state, or his
representative, but also distinctly to the state itself in its sovereign capacity. If the
acts giving rise to a suit are those of a foreign government done by its foreign
agent, although not necessarily a diplomatic personage, but acting in his
official capacity, the complaint could be barred by the immunity of the foreign
sovereign from suit without its consent. Suing a representative of a state is
believed to be, in effect, suing the state itself. The proscription is not accorded for
the benefit of an individual but for the State, in whose service he is, under the maxim
— par in parem, non habet imperium — that all states are sovereign equals and
cannot assert jurisdiction over one another. The implication, in broad terms, is that if
the judgment against an official would require the state itself to perform an
affirmative act to satisfy the award, such as the appropriation of the amount needed
to pay the damages decreed against him, the suit must be regarded as being
against the state itself, although it has not been formally impleaded. 21 (Emphasis
supplied.)
In the same case we also mentioned that in the case of diplomatic immunity, the privilege is
not an immunity from the observance of the law of the territorial sovereign or from ensuing legal
liability; it is, rather, an immunity from the exercise of territorial jurisdiction. 22
In United States of America v. Judge Guinto, 23 one of the consolidated cases therein
involved a Filipino employed at Clark Air Base who was arrested following a buy-bust operation
conducted by two officers of the US Air Force, and was eventually dismissed from his employment
when he was charged in court for violation ofR.A. No. 6425. In a complaint for damages filed by the
said employee against the military officers, the latter moved to dismiss the case on the ground that the
suit was against the US Government which had not given its consent. The RTC denied the motion but
on a petition for certiorari and prohibition filed before this Court, we reversed the RTC and dismissed
the complaint. We held that petitioners US military officers were acting in the exercise of their official
functions when they conducted the buy-bust operation against the complainant and thereafter testified
against him at his trial. It follows that for discharging their duties as agents of the United States, they
cannot be directly impleaded for acts imputable to their principal, which has not given its consent to be
sued.
This traditional rule of State immunity which exempts a State from being sued in the courts
of another State without the former's consent or waiver has evolved into a restrictive doctrine which
distinguishes sovereign and governmental acts (jure imperii) from private, commercial and proprietary
acts (jure gestionis). Under the restrictive rule of State immunity, State immunity extends only to
acts jure imperii. The restrictive application of State immunity is proper only when the proceedings
arise out of commercial transactions of the foreign sovereign, its commercial activities or economic
affairs. 24
In Shauf v. Court of Appeals, 25 we discussed the limitations of the State immunity principle,
thus:
It is a different matter where the public official is made to account in
his capacity as such for acts contrary to law and injurious to the rights of
plaintiff. As was clearly set forth by Justice Zaldivar in Director of the Bureau of
Telecommunications, et al. vs. Aligaen, etc., et al.: "Inasmuch as the State
authorizes only legal acts by its officers, unauthorized acts of government officials
or officers are not acts of the State, and an action against the officials or officers by
one whose rights have been invaded or violated by such acts, for the protection of
his rights, is not a suit against the State within the rule of immunity of the State from
suit. In the same tenor, it has been said that an action at law or suit in equity against
a State officer or the director of a State department on the ground that, while
claiming to act for the State, he violates or invades the personal and property rights
of the plaintiff, under an unconstitutional act or under an assumption of authority
which he does not have, is not a suit against the State within the constitutional
provision that the State may not be sued without its consent." The rationale for this
ruling is that the doctrine of state immunity cannot be used as an instrument for
perpetrating an injustice.
xxx xxx xxx
The aforecited authorities are clear on the matter. They state that the
doctrine of immunity from suit will not apply and may not be invoked where
 the public official is being sued in his private and personal capacity as an
ordinary citizen. The cloak of protection afforded the officers and agents of the
government is removed the moment they are sued in their individual capacity. This
situation usually arises where the public official acts without authority or in excess of
the powers vested in him. It is a well-settled principle of law that a public official
may be liable in his personal private capacity for whatever damage he may
have caused by his act done with malice and in bad faith, or beyond the
scope of his authority or jurisdiction. 26 (Emphasis supplied.)
In this case, the US respondents were sued in their official capacity as commanding officers
of the US Navy who had control and supervision over the USS Guardian and its crew. The alleged act
or omission resulting in the unfortunate grounding of the USS Guardian on the TRNP was committed
while they were performing official military duties. Considering that the satisfaction of a judgment
against said officials will require remedial actions and appropriation of funds by the US government,
the suit is deemed to be one against the US itself. The principle of State immunity therefore bars the
exercise of jurisdiction by this Court over the persons of respondents Swift, Rice and Robling. cEATSI
During the deliberations, Senior Associate Justice Antonio T. Carpio took the position that
the conduct of the US in this case, when its warship entered a restricted area in violation of R.A. No.
10067 and caused damage to the TRNP reef system, brings the matter within the ambit of Article 31 of
the United Nations Convention on the Law of the Sea (UNCLOS). He explained that while historically,
warships enjoy sovereign immunity from suit as extensions of their flag State, Art. 31 of the UNCLOS
creates an exception to this rule in cases where they fail to comply with the rules and regulations of the
coastal State regarding passage through the latter's internal waters and the territorial sea.
According to Justice Carpio, although the US to date has not ratified the UNCLOS, as a
matter of long-standing policy the US considers itself bound by customary international rules on the
"traditional uses of the oceans" as codified in UNCLOS, as can be gleaned from previous declarations
marine resources is one situation in which the above provisions may apply. But what if the offending
by former Presidents Reagan and Clinton, and the US judiciary in the case of United States v. Royal
warship is a non-party to the UNCLOS, as in this case, the US?
Caribbean Cruise Lines, Ltd. 27
The international law of the sea is generally defined as "a body of treaty rules and
but despite this the US, the world's leading maritime power, has not ratified it.
customary norms governing the uses of the sea, the exploitation of its resources, and the exercise of
jurisdiction over maritime regimes. It is a branch of public international law, regulating the relations of
states with respect to the uses of the oceans." 28 The UNCLOS is a multilateral treaty which was
opened for signature on December 10, 1982 at Montego Bay, Jamaica. It was ratified by the
Philippines in 1984 but came into force on November 16, 1994 upon the submission of the 60th
ratification.
The UNCLOS is a product of international negotiation that seeks to balance State
sovereignty (mare clausum) and the principle of freedom of the high seas (mare liberum). 29 The
freedom to use the world's marine waters is one of the oldest customary principles of international
law. 30 The UNCLOS gives to the coastal State sovereign rights in varying degrees over the different
zones of the sea which are: 1) internal waters, 2) territorial sea, 3) contiguous zone, 4) exclusive
economic zone, and 5) the high seas. It also gives coastal States more or less jurisdiction over foreign
vessels depending on where the vessel is located. 31 TCHEDA
Insofar as the internal waters and territorial sea is concerned, the Coastal State exercises
sovereignty, subject to the UNCLOS and other rules of international law. Such sovereignty extends to
the air space over the territorial sea as well as to its bed and subsoil. 32
In the case of warships, 33 as pointed out by Justice Carpio, they continue to enjoy
sovereign immunity subject to the following exceptions:
Article 30
Non-compliance by warships with the laws and regulations of the coastal State
If any warship does not comply with the laws and regulations of the
coastal State concerning passage through the territorial sea and disregards any
request for compliance therewith which is made to it, the coastal State may require
it to leave the territorial sea immediately.
Article 31
Responsibility of the flag State for damage caused by a warship or other
government ship operated for non-commercial purposes
The flag State shall bear international responsibility for any loss or
damage to the coastal State resulting from the non-compliance by a warship
or other government ship operated for non-commercial purposes with the laws
and regulations of the coastal State concerning passage through the
territorial sea or with the provisions of this Convention or other rules of
international law.
Article 32
Immunities of warships and other government ships operated for
non-commercial purposes
With such exceptions as are contained in subsection A and in articles 30
and 31, nothing in this Convention affects the immunities of warships and other
government ships operated for non-commercial purposes. (Emphasis supplied.)
A foreign warship's unauthorized entry into our internal waters with resulting damage to
An overwhelming majority — over 80% — of nation states are now members of UNCLOS,
While the Reagan administration was instrumental in UNCLOS'
negotiation and drafting, the U.S. delegation ultimately voted against and refrained
from signing it due to concerns over deep seabed mining technology transfer
provisions contained in Part XI. In a remarkable, multilateral effort to induce U.S.
membership, the bulk of UNCLOS member states cooperated over the succeeding
decade to revise the objectionable provisions. The revisions satisfied the Clinton
administration, which signed the revised Part XI implementing agreement in 1994.
In the fall of 1994, President Clinton transmitted UNCLOS and the Part XI
implementing agreement to the Senate requesting its advice and consent. Despite
consistent support from President Clinton, each of his successors, and an
ideologically diverse array of stakeholders, the Senate has since withheld the
consent required for the President to internationally bind the United States to
UNCLOS.
While UNCLOS cleared the Senate Foreign Relations Committee (SFRC)
during the 108th and 110th Congresses, its progress continues to be hamstrung by
significant pockets of political ambivalence over U.S. participation in international
institutions. Most recently, 111th Congress SFRC Chairman Senator John Kerry
included "voting out" UNCLOS for full Senate consideration among his highest
priorities. This did not occur, and no Senate action has been taken on UNCLOS by
the 112th Congress. 34 THaCAI
 Justice Carpio invited our attention to the policy statement given by President Reagan on
March 10, 1983 that the US will "recognize the rights of the other states in the waters off their coasts,
as reflected in the convention [UNCLOS], so long as the rights and freedom of the United States and
others under international law are recognized by such coastal states", and President Clinton's
reiteration of the US policy "to act in a manner consistent with its [UNCLOS] provisions relating to
traditional uses of the oceans and to encourage other countries to do likewise." Since Article 31
relates to the "traditional uses of the oceans," and "if under its policy, the US 'recognize[s] the rights of
the other states in the waters off their coasts,'" Justice Carpio postulates that "there is more reason to
expect it to recognize the rights of other states in their internal waters, such as the Sulu Sea in this
case."
As to the non-ratification by the US, Justice Carpio emphasizes that "the US' refusal to join
the UNCLOS was centered on its disagreement with UNCLOS' regime of deep seabed mining (Part XI)
which considers the oceans and deep seabed commonly owned by mankind," pointing out that such
"has nothing to do with its [the US'] acceptance of customary international rules on navigation."
It may be mentioned that even the US Navy Judge Advocate General's Corps publicly
endorses the ratification of the UNCLOS, as shown by the following statement posted on its official
website:
The Convention is in the national interest of the United States because it
establishes stable maritime zones, including a maximum outer limit for territorial
seas; codifies innocent passage, transit passage, and archipelagic sea lanes
passage rights; works against "jurisdictional creep" by preventing coastal nations
from expanding their own maritime zones; and reaffirms sovereign immunity of
warships, auxiliaries and government aircraft.
xxx xxx xxx
Economically, accession to the Convention would support our national
interests by enhancing the ability of the US to assert its sovereign rights over the
resources of one of the largest continental shelves in the world. Further, it is the Law
of the Sea Convention that first established the concept of a maritime Exclusive
Economic Zone out to 200 nautical miles, and recognized the rights of coastal
states to conserve and manage the natural resources in this Zone. 35
We fully concur with Justice Carpio's view that non-membership in the UNCLOS does not
mean that the US will disregard the rights of the Philippines as a Coastal State over its internal waters
and territorial sea. We thus expect the US to bear "international responsibility" under Art. 31 in
connection with the USS Guardian grounding which adversely affected the Tubbataha reefs. Indeed,
it is difficult to imagine that our long-time ally and trading partner, which has been actively supporting
the country's efforts to preserve our vital marine resources, would shirk from its obligation to
compensate the damage caused by its warship while transiting our internal waters. Much less can we
comprehend a Government exercising leadership in international affairs, unwilling to comply with the
UNCLOS directive for all nations to cooperate in the global task to protect and preserve the marine
environment as provided in Article 197, viz.:
Article 197
Cooperation on a global or regional basis.
States shall cooperate on a global basis and, as appropriate, on a
regional basis, directly or through competent international organizations, in
formulating and elaborating international rules, standards and recommended
practices and procedures consistent with this Convention, for the protection and
preservation of the marine environment, taking into account characteristic regional
features. HEcIDa
In fine, the relevance of UNCLOS provisions to the present controversy is beyond dispute.
Although the said treaty upholds the immunity of warships from the jurisdiction of Coastal States while
navigating the latter's territorial sea, the flag States shall be required to leave the territorial sea
immediately if they flout the laws and regulations of the Coastal State, and they will be liable for
damages caused by their warships or any other government vessel operated for non-commercial
purposes under Article 31.
Petitioners argue that there is a waiver of immunity from suit found in the VFA. Likewise,
they invoke federal statutes in the US under which agencies of the US have statutorily waived their
immunity to any action. Even under the common law tort claims, petitioners asseverate that the US
respondents are liable for negligence, trespass and nuisance.
We are not persuaded.
The VFA is an agreement which defines the treatment of United States troops and
personnel visiting the Philippines to promote "common security interests" between the US and the
Philippines in the region. It provides for the guidelines to govern such visits of military personnel, and
further defines the rights of the United States and the Philippine government in the matter of criminal
jurisdiction, movement of vessel and aircraft, importation and exportation of equipment, materials and
supplies. 36 The invocation of US federal tort laws and even common law is thus improper
considering that it is the VFA which governs disputes involving US military ships and crew navigating
Philippine waters in pursuance of the objectives of the agreement.
As it is, the waiver of State immunity under the VFA pertains only to criminal jurisdiction and
not to special civil actions such as the present petition for issuance of a writ of Kalikasan. In fact, it can
be inferred from Section 17, Rule 7 of the Rules that a criminal case against a person charged with a
violation of an environmental law is to be filed separately:
SEC. 17. Institution of separate actions. — The filing of a petition for the
issuance of the writ of kalikasan shall not preclude the filing of separate civil,
criminal or administrative actions. IEHSDA
In any case, it is our considered view that a ruling on the application or non-application of
criminal jurisdiction provisions of the VFA to US personnel who may be found responsible for the
grounding of the USS Guardian, would be premature and beyond the province of a petition for a writ
of Kalikasan. We also find it unnecessary at this point to determine whether such waiver of State
immunity is indeed absolute. In the same vein, we cannot grant damages which have resulted from
the violation of environmental laws. The Rules allows the recovery of damages, including the
collection of administrative fines under R.A. No. 10067, in a separate civil suit or that deemed
instituted with the criminal action charging the same violation of an environmental law. 37
Section 15, Rule 7 enumerates the reliefs which may be granted in a petition for issuance of
a writ of Kalikasan, to wit:
SEC. 15. Judgment. — Within sixty (60) days from the time the petition is
submitted for decision, the court shall render judgment granting or denying the
privilege of the writ of kalikasan.
The reliefs that may be granted under the writ are the following:
(a) Directing respondent to permanently cease and desist from
committing acts or neglecting the performance of a duty in violation of
environmental laws resulting in environmental destruction or damage;
 (b) Directing the respondent public official, government agency, private
person or entity to protect, preserve, rehabilitate or restore the environment;
(c) Directing the respondent public official, government agency, private
person or entity to monitor strict compliance with the decision and orders of the
court;
(d) Directing the respondent public official, government agency, or
private person or entity to make periodic reports on the execution of the final
judgment; and
(e) Such other reliefs which relate to the right of the people to a balanced
and healthful ecology or to the protection, preservation, rehabilitation or restoration
of the environment, except the award of damages to individual petitioners.
(Emphasis supplied.)
We agree with respondents (Philippine officials) in asserting that this petition has become
moot in the sense that the salvage operation sought to be enjoined or restrained had already been
accomplished when petitioners sought recourse from this Court. But insofar as the directives to
Philippine respondents to protect and rehabilitate the coral reef structure and marine habitat adversely
affected by the grounding incident are concerned, petitioners are entitled to these reliefs
notwithstanding the completion of the removal of the USS Guardian from the coral reef.
However, we are mindful of the fact that the US and Philippine governments both
expressed readiness to negotiate and discuss the matter of compensation for the damage caused by
the USS Guardian. The US Embassy has also declared it is closely coordinating with local scientists
and experts in assessing the extent of the damage and appropriate methods of rehabilitation.
Exploring avenues for settlement of environmental cases is not proscribed by the Rules. As
can be gleaned from the following provisions, mediation and settlement are available for the
consideration of the parties, and which dispute resolution methods are encouraged by the court, to
wit:
RULE 3
xxx xxx xxx
SEC. 3. Referral to mediation. — At the start of the pre-trial conference,
the court shall inquire from the parties if they have settled the dispute; otherwise,
the court shall immediately refer the parties or their counsel, if authorized by their
clients, to the Philippine Mediation Center (PMC) unit for purposes of mediation. If
not available, the court shall refer the case to the clerk of court or legal researcher
for mediation. CSTDIE
Mediation must be conducted within a non-extendible period of thirty (30)
days from receipt of notice of referral to mediation.
The mediation report must be submitted within ten (10) days from the
expiration of the 30-day period.
SEC. 4. Preliminary conference. — If mediation fails, the court will
schedule the continuance of the pre-trial. Before the scheduled date of continuance,
the court may refer the case to the branch clerk of court for a preliminary conference
for the following purposes:
(a) To assist the parties in reaching a settlement;
xxx xxx xxx
SEC. 5. Pre-trial conference; consent decree. — The judge shall put the
parties and their counsels under oath, and they shall remain under oath in all
pre-trial conferences.
The judge shall exert best efforts to persuade the parties to arrive at a
settlement of the dispute. The judge may issue a consent decree approving the
agreement between the parties in accordance with law, morals, public order and
public policy to protect the right of the people to a balanced and healthful ecology.
xxx xxx xxx
SEC. 10. Efforts to settle. — The court shall endeavor to make the parties
to agree to compromise or settle in accordance with law at any stage of the
proceedings before rendition of judgment. (Underscoring supplied.)
The Court takes judicial notice of a similar incident in 2009 when a guided-missile cruiser,
the USS Port Royal, ran aground about half a mile off the Honolulu Airport Reef Runway and
remained stuck for four days. After spending $6.5 million restoring the coral reef, the US government
was reported to have paid the State of Hawaii $8.5 million in settlement over coral reef damage
caused by the grounding. 38 aSIAHC
To underscore that the US government is prepared to pay appropriate compensation for the
damage caused by the USS Guardian grounding, the US Embassy in the Philippines has announced
the formation of a US interdisciplinary scientific team which will "initiate discussions with the
Government of the Philippines to review coral reef rehabilitation options in Tubbataha, based on
assessments by Philippine-based marine scientists." The US team intends to "help assess damage
and remediation options, in coordination with the Tubbataha Management Office, appropriate
Philippine government entities, non-governmental organizations, and scientific experts from
Philippine universities." 39
A rehabilitation or restoration program to be implemented at the cost of the violator is also a
major relief that may be obtained under a judgment rendered in a citizens' suit under the Rules, viz.:
RULE 5
SECTION 1. Reliefs in a citizen suit. — If warranted, the court may grant
to the plaintiff proper reliefs which shall include the protection, preservation or
rehabilitation of the environment and the payment of attorney's fees, costs of suit
and other litigation expenses. It may also require the violator to submit a program of
rehabilitation or restoration of the environment, the costs of which shall be borne by
the violator, or to contribute to a special trust fund for that purpose subject to the
control of the court.
In the light of the foregoing, the Court defers to the Executive Branch on the matter of
compensation and rehabilitation measures through diplomatic channels. Resolution of these issues
impinges on our relations with another State in the context of common security interests under the
VFA. It is settled that "[t]he conduct of the foreign relations of our government is committed by the
Constitution to the executive and legislative — "the political" — departments of the government, and
the propriety of what may be done in the exercise of this political power is not subject to judicial inquiry
or decision." 40
On the other hand, we cannot grant the additional reliefs prayed for in the petition to order a
review of the VFA and to nullify certain immunity provisions thereof.
 As held in BAYAN (Bagong Alyansang Makabayan) v. Exec. Sec. Zamora, 41 the VFA was
duly concurred in by the Philippine Senate and has been recognized as a treaty by the United States
as attested and certified by the duly authorized representative of the United States government. The
VFA being a valid and binding agreement, the parties are required as a matter of international law to
abide by its terms and provisions. 42 The present petition under the Rules is not the proper remedy to
assail the constitutionality of its provisions.
WHEREFORE, the petition for the issuance of the privilege of the Writ of Kalikasan is
hereby DENIED.

No pronouncement as to costs.
SO ORDERED.
Carpio, Velasco, Jr., Leonardo-de Castro, Brion, Peralta, Bersamin, Del Castillo, Perez,
Reyes and Perlas-Bernabe, JJ., concur.
Sereno, C.J., see concurring opinion.
Leonen, J., see separate concurring opinion.
Mendoza, * J., is on official leave.
Jardeleza, ** J., took no part.
||| (Arigo v. Swift, G.R. No. 206510, [September 16, 2014])
 FIRST DIVISION
[G.R. No. 142396. February 11, 2003.]
KHOSROW MINUCHER, petitioner, vs. HON. COURT OF APPEALS and
ARTHUR SCALZO, respondents.
Vicente D. Millora for petitioner.
Abello Concepcion Regala and Cruz for private respondent.
SYNOPSIS
Petitioner Khosrow Minucher, an Iranian national, was charged for violation of Section 4
of Republic Act No. 6425, otherwise known as the "Dangerous Drugs Act of 1972." The narcotic agents
who raided the house of Minucher were accompanied by private respondent Arthur Scalzo. Minucher was
acquitted by the trial court of the charges. Minucher filed a civil case before the Regional Trial Court of
Manila for damages on account of what he claimed to have been trumped-up charges of drug trafficking
made by Arthur Scalzo. Scalzo filed a motion to dismiss the complaint on the ground that, being a special
agent of the United States Drug Enforcement Administration, he was entitled to diplomatic immunity. The
trial court denied the motion to dismiss. Scalzo filed a petition for certiorari with injunction with the Court,
asking that the complaint be ordered dismissed. The case was referred to the Court of Appeals. The
appellate court promulgated its decision sustaining the diplomatic immunity of Scalzo and ordering the
dismissal of the complaint against him. Minucher filed a petition for review with the Court, appealing the
judgment of the Court of Appeals. The Supreme Court reversed the decision of the appellate court and
remanded the case to the lower court. The Manila RTC continued with its hearings on the case. After trial,
the court rendered a decision in favor of petitioner Khosrow Minucher and adjudged private respondent
Arthur Scalzo liable in actual and compensatory damages of P520,000.00; moral damages in the sum of
P10 million; exemplary damages in the sum of P100,000.00; attorney's fees in the sum of P200,000.00 plus
costs. On appeal, the Court of Appeals reversed the decision of the trial court and sustained the defense of
Scalzo that he was sufficiently clothed with diplomatic immunity during his term of duty and thereby immune
from the criminal and civil jurisdiction of the "Receiving State" pursuant to the terms of the Vienna
Convention. Hence, the present petition for review. AScHCD
The Supreme Court denied the petition. According to the Court, a foreign agent, operating within
a territory, can be cloaked with immunity from suit but only as long as it can be established that he is acting
within the directives of the sending state. The consent of the host state is an indispensable requirement of
basic courtesy between the two sovereigns. The official exchanges of communication between agencies of
the government of the two countries, certifications from officials of both the Philippine Department of
Foreign Affairs and the United States Embassy, as well as the participation of members of the Philippine
Narcotics Command in the "buy-bust operation" conducted at the residence of Minucher at the behest of
Scalzo, may be inadequate to support the "diplomatic status" of the latter, but they give enough indication
that the Philippine government has given its imprimatur, if not consent, to the activities within Philippine
territory of agent Scalzo of the United States Drug Enforcement Agency. The job description of Scalzo has
tasked him to conduct surveillance on suspected drug suppliers and, after having ascertained the target, to
inform local law enforcers who would then be expected to make the arrest. In conducting surveillance
activities on Minucher, later acting as the poseur-buyer during the buy-bust operation, and then becoming a
principal witness in the criminal case against Minucher, Scalzo hardly can be said to have acted beyond the
scope of his official function or duties. HTIEaS
SYLLABUS
1. POLITICAL LAW; INTERNATIONAL LAW; DOCTRINE OF STATE IMMUNITY FROM SUIT;
DIPLOMATIC IMMUNITY; A PREROGATIVE OF THE EXECUTIVE BRANCH OF THE GOVERNMENT.
— Vesting a person with diplomatic immunity is a prerogative of the executive branch of the government.
In World Health Organization vs. Aquino, the Court has recognized that, in such matters, the hands of the
courts are virtually tied. Amidst apprehensions of indiscriminate and incautious grant of immunity, designed
to gain exemption from the jurisdiction of courts, it should behoove the Philippine government, specifically
its Department of Foreign Affairs, to be most circumspect, that should particularly be no less than
compelling, in its post litem motam issuances. It might be recalled that the privilege is not an immunity from
the observance of the law of the territorial sovereign or from ensuing legal liability; it is, rather, an immunity
from the exercise of territorial jurisdiction. The government of the United States itself, which Scalzo claims
to be acting for, has formulated its standards for recognition of a diplomatic agent. The State Department
policy is to only concede diplomatic status to a person who possesses an acknowledged diplomatic title
and "performs duties of diplomatic nature." Supplementary criteria for accreditation are the possession of a
valid diplomatic passport or, from States which do not issue such passports, a diplomatic note formally
representing the intention to assign the person to diplomatic duties, the holding of a non-immigrant visa,
being over twenty-one years of age, and performing diplomatic functions on an essentially full-time basis.
Diplomatic missions are requested to provide the most accurate and descriptive job title to that which
currently applies to the duties performed. The Office of the Protocol would then assign each individual to
the appropriate functional category.
2. ID.; ID.; ID.; ID.; IF THE ACTS GIVING RISE TO A SUIT ARE THOSE OF A FOREIGN
GOVERNMENT DONE BY ITS FOREIGN AGENT, ALTHOUGH NOT NECESSARILY A DIPLOMATIC
PERSONAGE, BUT ACTING IN HIS OFFICIAL CAPACITY, THE COMPLAINT COULD BE BARRED BY
THE IMMUNITY OF THE FOREIGN SOVEREIGN FROM SUIT WITHOUT ITS CONSENT. — But while
the diplomatic immunity of Scalzo might thus remain contentious, it was sufficiently established that, indeed,
he worked for the United States Drug Enforcement Agency and was tasked to conduct surveillance of
suspected drug activities within the country on the dates pertinent to this case. If it should be ascertained
that Arthur Scalzo was acting well within his assigned functions when he committed the acts alleged in the
complaint, the present controversy could then be resolved under the related doctrine of State Immunity
from Suit. The precept that a State cannot be sued in the courts of a foreign state is a long-standing rule of
customary international law then closely identified with the personal immunity of a foreign sovereign from
suit and, with the emergence of democratic states, made to attach not just to the person of the head of state,
or his representative, but also distinctly to the state itself in its sovereign capacity. If the acts giving rise to a
suit are those of a foreign government done by its foreign agent, although not necessarily a diplomatic
personage, but acting in his official capacity, the complaint could be barred by the immunity of the foreign
sovereign from suit without its consent. Suing a representative of a state is believed to be, in effect, suing
the state itself. The proscription is not accorded for the benefit of an individual but for the State, in whose
service he is, under the maxim — par in parem, non habet imperium — that all states are sovereign equals
and cannot assert jurisdiction over one another. The implication, in broad terms, is that if the judgment
against an official would require the state itself to perform an affirmative act to satisfy the award, such as
the appropriation of the amount needed to pay the damages decreed against him, the suit must be
regarded as being against the state itself, although it has not been formally impleaded.
3. ID.; ID.; ID.; ID.; A FOREIGN AGENT, OPERATING WITHIN A TERRITORY, CAN BE
CLOAKED WITH IMMUNITY FROM SUIT AS LONG AS IT CAN BE ESTABLISHED THAT HE IS ACTING
WITHIN THE DIRECTIVES OF THE SENDING STATE. — A foreign agent, operating within a territory, can
be cloaked with immunity from suit but only as long as it can be established that he is acting within the
directives of the sending state. The consent of the host state is an indispensable requirement of basic
courtesy between the two sovereigns. The official exchanges of communication between agencies of the
government of the two countries, certifications from officials of both the Philippine Department of Foreign
Affairs and the United States Embassy, as well as the participation of members of the Philippine Narcotics
Command in the "buy-bust operation" conducted at the residence of Minucher at the behest of Scalzo, may
be inadequate to support the "diplomatic status" of the latter but they give enough indication that the
Philippine government has given its imprimatur, if not consent, to the activities within Philippine territory of
agent Scalzo of the United States Drug Enforcement Agency. The job description of Scalzo has tasked him
to conduct surveillance on suspected drug suppliers and, after having ascertained the target, to inform local
law enforcers who would then be expected to make the arrest. In conducting surveillance activities on
Minucher, later acting as the poseur-buyer during the buy-bust operation, and then becoming a principal
witness in the criminal case against Minucher, Scalzo hardly can be said to have acted beyond the scope of
his official function or duties. All told, this Court is constrained to rule that respondent Arthur Scalzo, an
agent of the United States Drug Enforcement Agency allowed by the Philippine government to conduct
activities in the country to help contain the problem on the drug traffic, is entitled to the defense of state
immunity from suit. SHAcID
DECISION
VITUG, J p:
Sometime in May 1986, an Information for violation of Section 4 of Republic Act No. 6425,
otherwise also known as the "Dangerous Drugs Act of 1972," was filed against petitioner Khosrow
Minucher and one Abbas Torabian with the Regional Trial Court, Branch 151, of Pasig City. The criminal
charge followed a "buy-bust operation" conducted by the Philippine police narcotic agents in the house of
Minucher, an Iranian national, where a quantity of heroin, a prohibited drug, was said to have been seized.
The narcotic agents were accompanied by private respondent Arthur Scalzo who would, in due time,
become one of the principal witnesses for the prosecution. On 08 January 1988, Presiding Judge Eutropio
Migrino rendered a decision acquitting the two accused. ScHADI
On 03 August 1988, Minucher filed Civil Case No. 88-45691 before the Regional Trial Court
(RTC), Branch 19, of Manila for damages on account of what he claimed to have been trumped-up charges
of drug trafficking made by Arthur Scalzo. The Manila RTC detailed what it had found to be the facts and
circumstances surrounding the case.
"The testimony of the plaintiff disclosed that he is an Iranian national. He
came to the Philippines to study in the University of the Philippines in 1974. In 1976,
under the regime of the Shah of Iran, he was appointed Labor Attaché for the
Iranian Embassies in Tokyo, Japan and Manila, Philippines. When the Shah of Iran
was deposed by Ayatollah Khomeini, plaintiff became a refugee of the United
Nations and continued to stay in the Philippines. He headed the Iranian National
Resistance Movement in the Philippines.
"He came to know the defendant on May 13, 1986, when the latter was
brought to his house and introduced to him by a certain Jose Iñigo, an informer of
the Intelligence Unit of the military. Jose Iñigo, on the other hand, was met by
plaintiff at the office of Atty. Crisanto Saruca, a lawyer for several Iranians whom
plaintiff assisted as head of the anti-Khomeini movement in the Philippines.
"During his first meeting with the defendant on May 13, 1986, upon the
introduction of Jose Iñigo, the defendant expressed his interest in buying caviar. As
a matter of fact, he bought two kilos of caviar from plaintiff and paid P10,000.00 for
it. Selling caviar, aside from that of Persian carpets, pistachio nuts and other Iranian
products was his business after the Khomeini government cut his pension of over
$3,000.00 per month. During their introduction in that meeting, the defendant gave
the plaintiff his calling card, which showed that he is working at the US Embassy in
the Philippines, as a special agent of the Drug Enforcement Administration,
Department of Justice, of the United States, and gave his address as US Embassy,
Manila. At the back of the card appears a telephone number in defendant's own
handwriting, the number of which he can also be contacted.
"It was also during this first meeting that plaintiff expressed his desire to
obtain a US Visa for his wife and the wife of a countryman named Abbas Torabian.
The defendant told him that he [could] help plaintiff for a fee of $2,000.00 per visa.
Their conversation, however, was more concentrated on politics, carpets and caviar.
Thereafter, the defendant promised to see plaintiff again.
"On May 19, 1986, the defendant called the plaintiff and invited the latter
for dinner at Mario's Restaurant at Makati. He wanted to buy 200 grams of caviar.
Plaintiff brought the merchandise but for the reason that the defendant was not yet
there, he requested the restaurant people to . . . place the same in the refrigerator.
Defendant, however, came and plaintiff gave him the caviar for which he was paid.
Then their conversation was again focused on politics and business.
"On May 26, 1986, defendant visited plaintiff again at the latter's
residence for 18 years at Kapitolyo, Pasig. The defendant wanted to buy a pair of
carpets which plaintiff valued at $27,900.00. After some haggling, they agreed at
$24,000.00. For the reason that defendant did not yet have the money, they agreed
that defendant would come back the next day. The following day, at 1:00 p.m., he
came back with his $24,000.00, which he gave to the plaintiff, and the latter, in turn,
gave him the pair of carpets.
"At about 3:00 in the afternoon of May 27, 1986, the defendant came
back again to plaintiff's house and directly proceeded to the latter's bedroom, where
the latter and his countryman, Abbas Torabian, were playing chess. Plaintiff opened
his safe in the bedroom and obtained $2,000.00 from it, gave it to the defendant for
the latter's fee in obtaining a visa for plaintiff's wife. The defendant told him that he
would be leaving the Philippines very soon and requested him to come out of the
house for a while so that he can introduce him to his cousin waiting in a cab. Without
much ado, and without putting on his shirt as he was only in his pajama pants, he
followed the defendant where he saw a parked cab opposite the street. To his
complete surprise, an American jumped out of the cab with a drawn high-powered
gun. He was in the company of about 30 to 40 Filipino soldiers with 6 Americans, all
armed. He was handcuffed and after about 20 minutes in the street, he was brought
inside the house by the defendant. He was made to sit down while in handcuffs
while the defendant was inside his bedroom. The defendant came out of the
bedroom and out from defendant's attaché case, he took something and placed it
on the table in front of the plaintiff. They also took plaintiff's wife who was at that time
at the boutique near his house and likewise arrested Torabian, who was playing
 chess with him in the bedroom and both were handcuffed together. Plaintiff was not
told why he was being handcuffed and why the privacy of his house, especially his
bedroom was invaded by defendant. He was not allowed to use the telephone. In
fact, his telephone was unplugged. He asked for any warrant, but the defendant told
him to 'shut up.' He was nevertheless told that he would be able to call for his lawyer
who can defend him. CTDAaE
"The plaintiff took note of the fact that when the defendant invited him to
come out to meet his cousin, his safe was opened where he kept the $24,000.00 the
defendant paid for the carpets and another $8,000.00 which he also placed in the
safe together with a bracelet worth $15,000.00 and a pair of earrings worth
$10,000.00. He also discovered missing upon his release his 8 pieces hand-made
Persian carpets, valued at $65,000.00, a painting he bought P30,000.00 together
with his TV and betamax sets. He claimed that when he was handcuffed, the
defendant took his keys from his wallet. There was, therefore, nothing left in his
house.
"That his arrest as a heroin trafficker . . . had been well publicized
throughout the world, in various newspapers, particularly in Australia, America,
Central Asia and in the Philippines. He was identified in the papers as an
international drug trafficker . . . .
In fact, the arrest of defendant and Torabian was likewise on television,
not only in the Philippines, but also in America and in Germany. His friends in said
places informed him that they saw him on TV with said news.
"After the arrest made on plaintiff and Torabian, they were brought to
Camp Crame handcuffed together, where they were detained for three days without
food and water." 1
During the trial, the law firm of Luna, Sison and Manas, filed a special appearance for Scalzo and
moved for extension of time to file an answer pending a supposed advice from the United States
Department of State and Department of Justice on the defenses to be raised. The trial court granted the
motion. On 27 October 1988, Scalzo filed another special appearance to quash the summons on the
ground that he, not being a resident of the Philippines and the action being one in personam, was beyond
the processes of the court. The motion was denied by the court, in its order of 13 December 1988, holding
that the filing by Scalzo of a motion for extension of time to file an answer to the complaint was a voluntary
appearance equivalent to service of summons which could likewise be construed a waiver of the
requirement of formal notice. Scalzo filed a motion for reconsideration of the court order, contending that a
motion for an extension of time to file an answer was not a voluntary appearance equivalent to service of
summons since it did not seek an affirmative relief. Scalzo argued that in cases involving the United States
government, as well as its agencies and officials, a motion for extension was peculiarly unavoidable due to
the need (1) for both the Department of State and the Department of Justice to agree on the defenses to be
raised and (2) to refer the case to a Philippine lawyer who would be expected to first review the case. The
court a quo denied the motion for reconsideration in its order of 15 October 1989.
Scalzo filed a petition for review with the Court of Appeals, there docketed CA-G.R. No. 17023,
assailing the denial. In a decision, dated 06 October 1989, the appellate court denied the petition and
affirmed the ruling of the trial court. Scalzo then elevated the incident in a petition for review on certiorari,
docketed G.R. No. 91173, to this Court. The petition, however, was denied for its failure to comply with SC
Circular No. 1-88; in any event, the Court added, Scalzo had failed to show that the appellate court was in
error in its questioned judgment.
Meanwhile, at the court a quo, an order, dated 09 February 1990, was issued (a) declaring
Scalzo in default for his failure to file a responsive pleading (answer) and (b) setting the case for the
reception of evidence. On 12 March 1990, Scalzo filed a motion to set aside the order of default and to
admit his answer to the complaint. Granting the motion, the trial court set the case for pre-trial. In his
answer, Scalzo denied the material allegations of the complaint and raised the affirmative defenses (a) of
Minucher's failure to state a cause of action in his complaint and (b) that Scalzo had acted in the discharge
of his official duties as being merely an agent of the Drug Enforcement Administration of the United States
Department of Justice. Scalzo interposed a counterclaim of P100,000.00 to answer for attorneys' fees and
expenses of litigation.
Then, on 14 June 1990, after almost two years since the institution of the civil case, Scalzo filed
a motion to dismiss the complaint on the ground that, being a special agent of the United States Drug
Enforcement Administration, he was entitled to diplomatic immunity. He attached to his motion Diplomatic
Note No. 414 of the United States Embassy, dated 29 May 1990, addressed to the Department of Foreign
Affairs of the Philippines and a Certification, dated 11 June 1990, of Vice Consul Donna Woodward,
certifying that the note is a true and faithful copy of its original. In an order of 25 June 1990, the trial court
denied the motion to dismiss.
On 27 July 1990, Scalzo filed a petition for certiorari with injunction with this Court, docketed G.R.
No. 94257 and entitled "Arthur W. Scalzo, Jr., vs. Hon. Wenceslao Polo, et al.," asking that the complaint in
Civil Case No. 88-45691 be ordered dismissed. The case was referred to the Court of Appeals, there
docketed CA-G.R. SP No. 22505, per this Court's resolution of 07 August 1990. On 31 October 1990, the
Court of Appeals promulgated its decision sustaining the diplomatic immunity of Scalzo and ordering the
dismissal of the complaint against him. Minucher filed a petition for review with this Court, docketed G.R.
No. 97765 and entitled "Khosrow Minucher vs. the Honorable Court of Appeals, et al." (cited in 214 SCRA
242), appealing the judgment of the Court of Appeals. In a decision, dated 24 September 1992, penned by
Justice (now Chief Justice) Hilario Davide, Jr., this Court reversed the decision of the appellate court and
remanded the case to the lower court for trial. The remand was ordered on the theses (a) that the Court of
Appeals erred in granting the motion to dismiss of Scalzo for lack of jurisdiction over his person without
even considering the issue of the authenticity of Diplomatic Note No. 414 and (b) that the complaint
contained sufficient allegations to the effect that Scalzo committed the imputed acts in his personal
capacity and outside the scope of his official duties and, absent any evidence to the contrary, the issue on
Scalzo's diplomatic immunity could not be taken up. SCaTAc
The Manila RTC thus continued with its hearings on the case. On 17 November 1995, the trial
court reached a decision; it adjudged:
"WHEREFORE, and in view of all the foregoing considerations, judgment
is hereby rendered for the plaintiff, who successfully established his claim by
sufficient evidence, against the defendant in the manner following:
"'Adjudging defendant liable to plaintiff in actual and
compensatory damages of P520,000.00; moral damages in the sum of
P10 million; exemplary damages in the sum of P100,000.00; attorney's
fees in the sum of P200,000.00 plus costs.
'The Clerk of the Regional Trial Court, Manila, is ordered to
take note of the lien of the Court on this judgment to answer for the
unpaid docket fees considering that the plaintiff in this case instituted this
action as a pauper litigant."' 2
While the trial court gave credence to the claim of Scalzo and the evidence presented by him that
he was a diplomatic agent entitled to immunity as such, it ruled that he, nevertheless, should be held
accountable for the acts complained of committed outside his official duties. On appeal, the Court of
Appeals reversed the decision of the trial court and sustained the defense of Scalzo that he was sufficiently
clothed with diplomatic immunity during his term of duty and thereby immune from the criminal and civil
jurisdiction of the "Receiving State" pursuant to the terms of the Vienna Convention.
Hence, this recourse by Minucher. The instant petition for review raises a two-fold issue: (1)
whether or not the doctrine of conclusiveness of judgment, following the decision rendered by this Court in
G.R. No. 97765, should have precluded the Court of Appeals from resolving the appeal to it in an entirely
different manner, and (2) whether or not Arthur Scalzo is indeed entitled to diplomatic immunity.
The doctrine of conclusiveness of judgment, or its kindred rule of res judicata, would require 1)
the finality of the prior judgment, 2) a valid jurisdiction over the subject matter and the parties on the part of
the court that renders it, 3) a judgment on the merits, and 4) an identity of the parties, subject matter and
causes of action.3 Even while one of the issues submitted in G.R. No. 97765 — "whether or not public
respondent Court of Appeals erred in ruling that private respondent Scalzo is a diplomat immune from civil
suit conformably with the Vienna Convention on Diplomatic Relations" — is also a pivotal question raised in
the instant petition, the ruling in G.R. No. 97765, however, has not resolved that point with finality. Indeed,
the Court there has made this observation —
"It may be mentioned in this regard that private respondent himself, in his
Pre-trial Brief filed on 13 June 1990, unequivocally states that he would present
documentary evidence consisting of DEA records on his investigation and
surveillance of plaintiff and on his position and duties as DEA special agent in
Manila. Having thus reserved his right to present evidence in support of his position,
which is the basis for the alleged diplomatic immunity, the barren self-serving claim
in the belated motion to dismiss cannot be relied upon for a reasonable, intelligent
and fair resolution of the diplomatic immunity." 4 —
Scalzo contends that the Vienna Convention on Diplomatic Relations, to which the Philippines is
a signatory, grants him absolute immunity from suit, describing his functions as an agent of the United
States Drugs Enforcement Agency as "conducting surveillance operations on suspected drug dealers in
the Philippines believed to be the source of prohibited drugs being shipped to the U.S., (and) having
ascertained the target, (he then) would inform the Philippine narcotic agents (to) make the actual arrest."
Scalzo has submitted to the trial court a number of documents —
1. Exh. '2' — Diplomatic Note No. 414 dated 29 May 1990;
2. Exh. '1' — Certification of Vice Consul Donna K. Woodward dated 11 June 1990;
3. Exh. '5' — Diplomatic Note No. 757 dated 25 October 1991;
4. Exh. '6' — Diplomatic Note No. 791 dated 17 November 1992; and
5. Exh. '7' — Diplomatic Note No. 833 dated 21 October 1988.
6. Exh. '3' — 1st Indorsement of the Hon. Jorge R. Coquia, Legal Adviser,
Department of Foreign Affairs, dated 27 June 1990 forwarding Embassy
Note No. 414 to the Clerk of Court of RTC Manila, Branch 19 (the trial
court);
7. Exh. '4' — Diplomatic Note No. 414, appended to the 1st Indorsement (Exh. '3');
and
8. Exh. '8' — Letter dated 18 November 1992 from the Office of the Protocol,
Department of Foreign Affairs, through Asst. Sec. Emmanuel Fernandez,
addressed to the Chief Justice of this Court. 5
The documents, according to Scalzo, would show that: (1) the United States Embassy
accordingly advised the Executive Department of the Philippine Government that Scalzo was a member of
the diplomatic staff of the United States diplomatic mission from his arrival in the Philippines on 14 October
1985 until his departure on 10 August 1988; (2) that the United States Government was firm from the very
beginning in asserting the diplomatic immunity of Scalzo with respect to the case pursuant to the provisions
of the Vienna Convention on Diplomatic Relations; and (3) that the United States Embassy repeatedly
urged the Department of Foreign Affairs to take appropriate action to inform the trial court of Scalzo's
diplomatic immunity. The other documentary exhibits were presented to indicate that: (1) the Philippine
government itself, through its Executive Department, recognizing and respecting the diplomatic status of
Scalzo, formally advised the "Judicial Department" of his diplomatic status and his entitlement to all
diplomatic privileges and immunities under the Vienna Convention; and (2) the Department of Foreign
Affairs itself authenticated Diplomatic Note No. 414. Scalzo additionally presented Exhibits "9" to "13"
consisting of his reports of investigation on the surveillance and subsequent arrest of Minucher, the
certification of the Drug Enforcement Administration of the United States Department of Justice that Scalzo
was a special agent assigned to the Philippines at all times relevant to the complaint, and the special power
of attorney executed by him in favor of his previous counsel 6 to show (a) that the United States Embassy,
affirmed by its Vice Consul, acknowledged Scalzo to be a member of the diplomatic staff of the United
States diplomatic mission from his arrival in the Philippines on 14 October 1985 until his departure on 10
August 1988, (b) that, on May 1986, with the cooperation of the Philippine law enforcement officials and in
the exercise of his functions as member of the mission, he investigated Minucher for alleged trafficking in a
prohibited drug, and (c) that the Philippine Department of Foreign Affairs itself recognized that Scalzo
during his tour of duty in the Philippines (14 October 1985 up to 10 August 1988) was listed as being an
Assistant Attaché of the United States diplomatic mission and accredited with diplomatic status by the
Government of the Philippines. In his Exhibit 12, Scalzo described the functions of the overseas office of
the United States Drugs Enforcement Agency, i.e., (1) to provide criminal investigative expertise and
assistance to foreign law enforcement agencies on narcotic and drug control programs upon the request of
the host country, 2) to establish and maintain liaison with the host country and counterpart foreign law
enforcement officials, and 3) to conduct complex criminal investigations involving international criminal
conspiracies which affect the interests of the United States. DIEACH
The Vienna Convention on Diplomatic Relations was a codification of centuries-old customary
law and, by the time of its ratification on 18 April 1961, its rules of law had long become stable. Among the
city states of ancient Greece, among the peoples of the Mediterranean before the establishment of the
Roman Empire, and among the states of India, the person of the herald in time of war and the person of the
diplomatic envoy in time of peace were universally held sacrosanct. 7 By the end of the 16th century, when
the earliest treatises on diplomatic law were published, the inviolability of ambassadors was firmly
established as a rule of customary international law. 8 Traditionally, the exercise of diplomatic intercourse
among states was undertaken by the head of state himself, as being the preeminent embodiment of the
state he represented, and the foreign secretary, the official usually entrusted with the external affairs of the
state. Where a state would wish to have a more prominent diplomatic presence in the receiving state, it
would then send to the latter a diplomatic mission. Conformably with the Vienna Convention, the functions
of the diplomatic mission involve, by and large, the representation of the interests of the sending state and
promoting friendly relations with the receiving state. 9
The Convention lists the classes of heads of diplomatic missions to include (a) ambassadors
or nuncios accredited to the heads of state, 10 (b) envoys, 11 ministers or internuncios accredited to the
heads of states; and (c) charges d' affairs 12 accredited to the ministers of foreign affairs. 13 Comprising
the "staff of the (diplomatic) mission" are the diplomatic staff, the administrative staff and the technical and
service staff. Only the heads of missions, as well as members of the diplomatic staff, excluding the
members of the administrative, technical and service staff of the mission, are accorded diplomatic rank.
Even while the Vienna Convention on Diplomatic Relations provides for immunity to the members of
diplomatic missions, it does so, nevertheless, with an understanding that the same be restrictively applied.
Only "diplomatic agents," under the terms of the Convention, are vested with blanket diplomatic immunity
from civil and criminal suits. The Convention defines "diplomatic agents" as the heads of missions or
members of the diplomatic staff, thus impliedly withholding the same privileges from all others. It might bear
stressing that even consuls, who represent their respective states in concerns of commerce and navigation
and perform certain administrative and notarial duties, such as the issuance of passports and visas,
authentication of documents, and administration of oaths, do not ordinarily enjoy the traditional diplomatic
immunities and privileges accorded diplomats, mainly for the reason that they are not charged with the duty
of representing their states in political matters. Indeed, the main yardstick in ascertaining whether a person
is a diplomat entitled to immunity is the determination of whether or not he performs duties of diplomatic
nature.
Scalzo asserted, particularly in his Exhibits "9" to "13," that he was an Assistant Attaché of the
United States diplomatic mission and was accredited as such by the Philippine Government. An attaché
belongs to a category of officers in the diplomatic establishment who may be in charge of its cultural, press,
administrative or financial affairs. There could also be a class of attaches belonging to certain ministries or
departments of the government, other than the foreign ministry or department, who are detailed by their
respective ministries or departments with the embassies such as the military, naval, air, commercial,
agricultural, labor, science, and customs attaches, or the like. Attaches assist a chief of mission in his
duties and are administratively under him, but their main function is to observe, analyze and interpret trends
and developments in their respective fields in the host country and submit reports to their own ministries or
departments in the home government. 14These officials are not generally regarded as members of the
diplomatic mission, nor are they normally designated as having diplomatic rank.
In an attempt to prove his diplomatic status, Scalzo presented Diplomatic Notes Nos. 414, 757
and 791, all issued post litem motam, respectively, on 29 May 1990, 25 October 1991 and 17 November
1992. The presentation did nothing much to alleviate the Court's initial reservations in G.R. No. 97765, viz:
"While the trial court denied the motion to dismiss, the public respondent
gravely abused its discretion in dismissing Civil Case No. 88-45691 on the basis of
an erroneous assumption that simply because of the diplomatic note, the private
respondent is clothed with diplomatic immunity, thereby divesting the trial court of
jurisdiction over his person.
"xxx xxx xxx
"And now, to the core issue — the alleged diplomatic immunity of the
private respondent. Setting aside for the moment the issue of authenticity raised by
the petitioner and the doubts that surround such claim, in view of the fact that it took
private respondent one (1) year, eight (8) months and seventeen (17) days from the
time his counsel filed on 12 September 1988 a Special Appearance and Motion
asking for a first extension of time to file the Answer because the Departments of
State and Justice of the United States of America were studying the case for the
purpose of determining his defenses, before he could secure the Diplomatic Note
from the US Embassy in Manila, and even granting for the sake of argument that
such note is authentic, the complaint for damages filed by petitioner cannot be
peremptorily dismissed.
"xxx xxx xxx
"There is of course the claim of private respondent that the acts imputed
to him were done in his official capacity. Nothing supports this self-serving claim
other than the so-called Diplomatic Note . . . . The public respondent then should
have sustained the trial court's denial of the motion to dismiss. Verily, it should have
been the most proper and appropriate recourse. It should not have been
overwhelmed by the self-serving Diplomatic Note whose belated issuance is even
suspect and whose authenticity has not yet been proved. The undue haste with
which respondent Court yielded to the private respondent's claim is arbitrary."
A significant document would appear to be Exhibit No. 08, dated 08 November 1992, issued by
the Office of Protocol of the Department of Foreign Affairs and signed by Emmanuel C. Fernandez,
Assistant Secretary, certifying that "the records of the Department (would) show that Mr. Arthur W. Scalzo,
Jr., during his term of office in the Philippines (from 14 October 1985 up to 10 August 1988) was listed as an
Assistant Attaché of the United States diplomatic mission and was, therefore, accredited diplomatic status
by the Government of the Philippines." No certified true copy of such "records," the supposed bases for the
belated issuance, was presented in evidence. SEIDAC
Concededly, vesting a person with diplomatic immunity is a prerogative of the executive branch
of the government. In World Health Organization vs. Aquino, 15the Court has recognized that, in such
matters, the hands of the courts are virtually tied. Amidst apprehensions of indiscriminate and incautious
grant of immunity, designed to gain exemption from the jurisdiction of courts, it should behoove the
Philippine government, specifically its Department of Foreign Affairs, to be most circumspect, that should
particularly be no less than compelling, in its post litem motam issuances. It might be recalled that the
privilege is not an immunity from the observance of the law of the territorial sovereign or from ensuing legal
liability; it is, rather, an immunity from the exercise of territorial jurisdiction. 16 The government of the
United States itself, which Scalzo claims to be acting for, has formulated its standards for recognition of a
diplomatic agent. The State Department policy is to only concede diplomatic status to a person who
possesses an acknowledged diplomatic title and "performs duties of diplomatic nature." 17 Supplementary
criteria for accreditation are the possession of a valid diplomatic passport or, from States which do not issue
such passports, a diplomatic note formally representing the intention to assign the person to diplomatic
duties, the holding of a non-immigrant visa, being over twenty-one years of age, and performing diplomatic
functions on an essentially full-time basis. 18 Diplomatic missions are requested to provide the most
accurate and descriptive job title to that which currently applies to the duties performed. The Office of the
Protocol would then assign each individual to the appropriate functional category. 19
But while the diplomatic immunity of Scalzo might thus remain contentious, it was sufficiently
established that, indeed, he worked for the United States Drug Enforcement Agency and was tasked to
conduct surveillance of suspected drug activities within the country on the dates pertinent to this case. If it
should be ascertained that Arthur Scalzo was acting well within his assigned functions when he committed
the acts alleged in the complaint, the present controversy could then be resolved under the related doctrine
of State Immunity from Suit.
The precept that a State cannot be sued in the courts of a foreign state is a long-standing rule of
customary international law then closely identified with the personal immunity of a foreign sovereign from
suit 20 and, with the emergence of democratic states, made to attach not just to the person of the head of
state, or his representative, but also distinctly to the state itself in its sovereign capacity. 21 If the acts giving
rise to a suit are those of a foreign government done by its foreign agent, although not necessarily a
diplomatic personage, but acting in his official capacity, the complaint could be barred by the immunity of
the foreign sovereign from suit without its consent. Suing a representative of a state is believed to be, in
effect, suing the state itself. The proscription is not accorded for the benefit of an individual but for the State,
in whose service he is, under the maxim — par in parem, non habet imperium — that all states are
sovereign equals and cannot assert jurisdiction over one another. 22 The implication, in broad terms, is
that if the judgment against an official would require the state itself to perform an affirmative act to satisfy
the award, such as the appropriation of the amount needed to pay the damages decreed against him, the
suit must be regarded as being against the state itself, although it has not been formally impleaded. 23
 In United States of America vs. Guinto, 24 involving officers of the United States Air Force and Drug Enforcement Agency, however, can be gleaned from the facts heretofore elsewhere mentioned. The
special officers of the Air Force Office of Special Investigators charged with the duty of preventing the official exchanges of communication between agencies of the government of the two countries,
distribution, possession and use of prohibited drugs, this Court has ruled — certifications from officials of both the Philippine Department of Foreign Affairs and the United States
Embassy, as well as the participation of members of the Philippine Narcotics Command in the "buy-bust
"While the doctrine (of state immunity) appears to prohibit only suits operation" conducted at the residence of Minucher at the behest of Scalzo, may be inadequate to support
against the state without its consent, it is also applicable to complaints filed against the "diplomatic status" of the latter but they give enough indication that the Philippine government has given
officials of the state for acts allegedly performed by them in the discharge of their its imprimatur, if not consent, to the activities within Philippine territory of agent Scalzo of the United States
duties. . . . It cannot for a moment be imagined that they were acting in their private Drug Enforcement Agency. The job description of Scalzo has tasked him to conduct surveillance on
or unofficial capacity when they apprehended and later testified against the suspected drug suppliers and, after having ascertained the target, to inform local law enforcers who would
complainant. It follows that for discharging their duties as agents of the United then be expected to make the arrest. In conducting surveillance activities on Minucher, later acting as the
States, they cannot be directly impleaded for acts imputable to their principal, which poseur-buyer during the buy-bust operation, and then becoming a principal witness in the criminal case
has not given its consent to be sued. . . . As they have acted on behalf of the against Minucher, Scalzo hardly can be said to have acted beyond the scope of his official function or
government, and within the scope of their authority, it is that government, and not duties. cATDIH
the petitioners personally, [who were] responsible for their acts." 25
All told, this Court is constrained to rule that respondent Arthur Scalzo, an agent of the United
This immunity principle, however, has its limitations. Thus, Shauf vs. Court of Appeals 26 elaborates: States Drug Enforcement Agency allowed by the Philippine government to conduct activities in the country
"It is a different matter where the public official is made to account in his to help contain the problem on the drug traffic, is entitled to the defense of state immunity from suit.
capacity as such for acts contrary to law and injurious to the rights of the plaintiff. As
WHEREFORE, on the foregoing premises, the petition is DENIED. No costs.
was clearly set forth by Justice Zaldivar in Director of the Bureau of
Telecommunications, et al., vs. Aligaen, et al. (33 SCRA 368): 'Inasmuch as the SO ORDERED.
State authorizes only legal acts by its officers, unauthorized acts of government
officials or officers are not acts of the State, and an action against the officials or ||| (Khosrow Minucher v. Court of Appeals, G.R. No. 142396, [February 11, 2003], 445 PHIL 250-272)
officers by one whose rights have been invaded or violated by such acts, for the
protection of his rights, is not a suit against the State within the rule of immunity of
the State from suit. In the same tenor, it has been said that an action at law or suit in
equity against a State officer or the director of a State department on the ground
that, while claiming to act for the State, he violates or invades the personal and
property rights of the plaintiff, under an unconstitutional act or under an assumption
of authority which he does not have, is not a suit against the State within the
constitutional provision that the State may not be sued without its consent. The
rationale for this ruling is that the doctrine of state immunity cannot be used as an
instrument for perpetrating an injustice.

"xxx xxx xxx

"(T)he doctrine of immunity from suit will not apply and may not be
invoked where the public official is being sued in his private and personal capacity
as an ordinary citizen. The cloak of protection afforded the officers and agents of the
government is removed the moment they are sued in their individual capacity. This
situation usually arises where the public official acts without authority or in excess of
the powers vested in him. It is a well-settled principle of law that a public official may
be liable in his personal private capacity for whatever damage he may have caused
by his act done with malice and in bad faith or beyond the scope of his authority and
jurisdiction." 27

A foreign agent, operating within a territory, can be cloaked with immunity from suit but only as
long as it can be established that he is acting within the directives of the sending state. The consent of the
host state is an indispensable requirement of basic courtesy between the two
sovereigns. Guinto and Shauf both involve officers and personnel of the United States, stationed within
Philippine territory, under the RP-US Military Bases Agreement. While evidence is wanting to show any
similar agreement between the governments of the Philippines and of the United States (for the latter to
send its agents and to conduct surveillance and related activities of suspected drug dealers in the
Philippines), the consent or imprimatur of the Philippine government to the activities of the United States
 EN BANC
[G.R. No. 154705. June 26, 2003.]
THE REPUBLIC OF INDONESIA, HIS EXCELLENCY AMBASSADOR
SOERATMIN, and MINISTER COUNSELLOR AZHARI
KASIM, petitioners,vs.JAMES VINZON, doing business under the name and
style of VINZON TRADE AND SERVICES, respondent.
Quasha Ancheta Pena & Nolasco for petitioners.
Fornier Fornier Saño & Lagumbay Law Firm for J. Vinzon.
SYNOPSIS
In August 1995, petitioner Republic of Indonesia entered into a Maintenance Agreement for its
specified buildings in the embassy with respondent James Vinzon as sole proprietor of Vinzon Trade and
Services. The said Agreement was effective for four years and will renew itself automatically unless
cancelled by either party by giving thirty days prior written notice from the date of expiry. Before August
1999, respondent was informed that the renewal of the agreement shall be at the discretion of the incoming
Chief of Administration, petitioner Minister Counsellor Azhari Kasim. On August 31, 2000, the Indonesian
Embassy terminated the said agreement. Respondent claimed that the said termination was arbitrary and
unlawful. Thus, he filed a complaint against petitioners in the Regional Trial Court of Makati, Branch 145. In
response, petitioners filed a motion to dismiss by alleging that the Republic of Indonesia has sovereign
immunity from suit and that Ambassador Soeratmin and Minister Counsellor Kasim enjoy diplomatic
immunity. The trial court denied petitioners' motion to dismiss. The Court of Appeals likewise denied
petitioners' petition for certiorari and prohibition in relation thereto. Hence, this petition for review
on certiorari.
The Court held that the immunity of the sovereign is recognized only with regard to public acts or
acts jure imperii,but not with regard to private acts or acts jure gestionis.In this case, there is no dispute that
the establishment of a diplomatic mission is an act jure imperii.A sovereign state does not merely establish
a diplomatic mission and leave it at that; the establishment of a diplomatic mission encompasses its
maintenance and upkeep. Hence, the State may enter into contracts with private entities to maintain the
premises, furnishings and equipment of the embassy and the living quarters of its agents and officials. It is,
therefore, clear that petitioner Republic of Indonesia was acting in pursuit of a sovereign activity when it
entered into a contract with respondent for the upkeep or maintenance of the air conditioning units,
generator sets, electrical facilities, water heaters, and water motor pumps of the Indonesian Embassy and
the official residence of the Indonesian ambassador.
Moreover, the act of petitioners Ambassador Soeratmin and Minister Counsellor Kasim in
terminating the Maintenance Agreement is not covered by the exceptions provided in Article 31 of the
Vienna Convention on Diplomatic Relations. Accordingly, the petition was granted and the complaint
against petitioners was dismissal.
SYLLABUS
1. PUBLIC INTERNATIONAL LAW; DOCTRINE OF SOVEREIGN IMMUNITY; NECESSARY
CONSEQUENCE OF THE PRINCIPLE OF INDEPENDENCE AND EQUALITY OF STATES. —
International law is founded largely upon the principles of reciprocity, comity, independence, and equality of
States which were adopted as part of the law of our land under Article II, Section 2 of the 1987 Constitution.
The rule that a State may not be sued without its consent is a necessary consequence of the principles of
independence and equality of States. As enunciated in Sanders v. Veridiano II,the practical justification for
the doctrine of sovereign immunity is that there can be no legal right against the authority that makes the
law on which the right depends. In the case of foreign States, the rule is derived from the principle of the
sovereign equality of States, as expressed in the maxim par in parem non habet imperium.All states are
sovereign equals and cannot assert jurisdiction over one another. A contrary attitude would "unduly vex the
peace of nations."
2. ID.;ID.;RECOGNIZED WITH REGARD TO PUBLIC ACTS ONLY. — The rules of International
Law, however, are neither unyielding nor impervious to change. The increasing need of sovereign States to
enter into purely commercial activities remotely connected with the discharge of their governmental
functions brought about a new concept of sovereign immunity. This concept, the restrictive theory, holds
that the immunity of the sovereign is recognized only with regard to public acts or actsjure imperii,but not
with regard to private acts or acts jure gestionis.
3. ID.;ID.;ID.;ENTERING INTO A CONTRACT BY FOREIGN STATE WITH PRIVATE PARTY
CANNOT BE THE ULTIMATE TEST OF WHETHER OR NOT IT IS A PUBLIC OR PRIVATE ACT. —
In United States v. Ruiz,for instance, we held that the conduct of public bidding for the repair of a wharf at a
United States Naval Station is an act jure imperii.On the other hand, we considered as an act jure
gestionis the hiring of a cook in the recreation center catering to American servicemen and the general
public at the John Hay Air Station in Baguio City, as well as the bidding for the operation of barber shops in
Clark Air Base in Angeles City. Apropos the present case, the mere entering into a contract by a foreign
State with a private party cannot be construed as the ultimate test of whether or not it is an act jure
imperii or jure gestionis.Such act is only the start of the inquiry. Is the foreign State engaged in the regular
conduct of a business? If the foreign State is not engaged regularly in a business or commercial activity,
and in this case it has not been shown to be so engaged, the particular act or transaction must then be
tested by its nature. If the act is in pursuit of a sovereign activity, or an incident thereof, then it is an act jure
imperii.
4. ID.;ID.;PROVISION IN A CONTRACT THAT ANY LEGAL ACTION ARISING OUT OF THE
AGREEMENT SHALL BE SETTLED ACCORDING TO PHILIPPINE LAWS IS NOT A WAIVER OF
SOVEREIGN IMMUNITY FROM SUIT. — [T]he existence alone of a paragraph in a contract stating that
any legal action arising out of the agreement shall be settled according to the laws of the Philippines and by
a specified court of the Philippines is not necessarily a waiver of sovereign immunity from suit. The
aforesaid provision contains language not necessarily inconsistent with sovereign immunity. On the other
hand, such provision may also be meant to apply where the sovereign party elects to sue in the local courts,
or otherwise waives its immunity by any subsequent act. The applicability of Philippine laws must be
deemed to include Philippine laws in its totality, including the principle recognizing sovereign immunity.
Hence, the proper court may have no proper action, by way of settling the case, except to dismiss it.
5. ID.;ID.;ID.;SUBMISSION BY A FOREIGN STATE TO LOCAL JURISDICTION MUST BE
CLEAR AND UNEQUIVOCAL. — Submission by a foreign state to local jurisdiction must be clear and
unequivocal. It must be given explicitly or by necessary implication. CaDSHE
6. ID.;ID.;MAINTENANCE OF THE PREMISES, FURNISHINGS AND EQUIPMENT OF THE
EMBASSY AND THE LIVING QUARTERS OF THE AGENTS AND OFFICIALS OF A FOREIGN STATE IS
A PUBLIC ACT. — There is no dispute that the establishment of a diplomatic mission is an act jure
imperii.A sovereign State does not merely establish a diplomatic mission and leave it at that; the
establishment of a diplomatic mission encompasses its maintenance and upkeep. Hence, the State may
enter into contracts with private entities to maintain the premises, furnishings and equipment of the
embassy and the living quarters of its agents and officials. It is therefore clear that petitioner Republic of
Indonesia was acting in pursuit of a sovereign activity when it entered into a contract with respondent for
the upkeep or maintenance of the air conditioning units, generator sets, electrical facilities, water heaters,
and water motor pumps of the Indonesian Embassy and the official residence of the Indonesian
ambassador. cSATEH
7. ID.;VIENNA CONVENTION ON DIPLOMATIC RELATIONS; IMMUNITY FROM SUITS OF
DIPLOMATIC, AGENTS, APPLICABLE IN CASE AT BAR. — On the matter of whether or not petitioners
Ambassador Soeratmin and Minister Counsellor Kasim may be sued herein in their private capacities,
Article 31 of the Vienna Convention on Diplomatic Relations provides: " ...1. A diplomatic agent shall enjoy
immunity from the criminal jurisdiction of the receiving State. He shall also enjoy immunity from its civil and
administrative jurisdiction, except in the case of: (a) a real action relating to private immovable property
situated in the territory of the receiving State, unless he holds it on behalf of the sending State for the
purposes of the mission; (b) an action relating to succession in which the diplomatic agent is involved as
executor, administrator, heir or legatee as a private person and not on behalf of the sending State; (c) an
action relating to any professional or commercial activity exercised by the diplomatic agent in the receiving
State outside his official functions. ..." The act of petitioners Ambassador Soeratinin and Minister
Counsellor Kasim in terminating the Maintenance Agreement is not covered by the exceptions provided in
the abovementioned provision. The Solicitor General believes that said act may fall under subparagraph (c)
thereof, but said provision clearly applies only to a situation where the diplomatic agent engages in any
professional or commercial activity outside official functions, which is not the case herein.
DECISION
AZCUNA, J p:
This is a petition for review on certiorari to set aside the Decision of the Court of Appeals dated
May 30, 2002 and its Resolution dated August 16, 2002, in CA-G.R. SP No. 66894 entitled "The Republic
of Indonesia, His Excellency Ambassador Soeratmin and Minister Counselor Azhari Kasim v. Hon. Cesar
Santamaria, Presiding Judge, RTC Branch 145, Makati City, and James Vinzon, doing business under the
name and style of Vinzon Trade and Services."
Petitioner, Republic of Indonesia, represented by its Counsellor, Siti Partinah, entered into a
Maintenance Agreement in August 1995 with respondent James Vinzon, sole proprietor of Vinzon Trade
and Services. The Maintenance Agreement stated that respondent shall, for a consideration, maintain
specified equipment at the Embassy Main Building, Embassy Annex Building and the Wisma Duta, the
official residence of petitioner Ambassador Soeratmin. The equipment covered by the Maintenance
Agreement are air conditioning units, generator sets, electrical facilities, water heaters, and water motor
pumps. It is likewise stated therein that the agreement shall be effective for a period of four years and will
renew itself automatically unless cancelled by either party by giving thirty days prior written notice from the
date of expiry. 1
Petitioners claim that sometime prior to the date of expiration of the said agreement, or before
August 1999, they informed respondent that the renewal of the agreement shall be at the discretion of the
incoming Chief of Administration, Minister Counsellor Azhari Kasim, who was expected to arrive in
February 2000. When Minister Counsellor Kasim assumed the position of Chief of Administration in March
2000, he allegedly found respondent's work and services unsatisfactory and not in compliance with the
standards set in the Maintenance Agreement. Hence, the Indonesian Embassy terminated the agreement
in a letter dated August 31, 2000. 2Petitioners claim, moreover, that they had earlier verbally informed
respondent of their decision to terminate the agreement.
On the other hand, respondent claims that the aforesaid termination was arbitrary and unlawful.
Respondent cites various circumstances which purportedly negated petitioners' alleged dissatisfaction
over respondent's services: (a) in July 2000, Minister Counsellor Kasim still requested respondent to
assign to the embassy an additional full-time worker to assist one of his other workers; (b) in August 2000,
Minister Counsellor Kasim asked respondent to donate a prize, which the latter did, on the occasion of the
Indonesian Independence Day golf tournament; and (c) in a letter dated August 22, 2000, petitioner
Ambassador Soeratmin thanked respondent for sponsoring a prize and expressed his hope that the cordial
relations happily existing between them will continue to prosper and be strengthened in the coming years.
Hence, on December 15, 2000, respondent filed a complaint 3 against petitioners docketed as
Civil Case No. 18203 in the Regional Trial Court (RTC) of Makati, Branch 145. On February 20, 2001,
petitioners filed a Motion to Dismiss, alleging that the Republic of Indonesia, as a foreign sovereign State,
has sovereign immunity from suit and cannot be sued as a party-defendant in the Philippines. The said
motion further alleged that Ambassador Soeratmin and Minister Counsellor Kasim are diplomatic agents as
defined under the Vienna Convention on Diplomatic Relations and therefore enjoy diplomatic
immunity. 4 In turn, respondent filed on March 20, 2001, an Opposition to the said motion alleging that the
Republic of Indonesia has expressly waived its immunity from suit. He based this claim upon the following
provision in the Maintenance Agreement:
"Any legal action arising out of this Maintenance Agreement shall be
settled according to the laws of the Philippines and by the proper court of Makati
City, Philippines."
Respondent's Opposition likewise alleged that Ambassador Soeratmin and Minister Counsellor Kasim
can be sued and held liable in their private capacities for tortious acts done with malice and bad
faith. 5
On May 17, 2001, the trial court denied herein petitioners' Motion to Dismiss. It likewise denied
the Motion for Reconsideration subsequently filed.
The trial court's denial of the Motion to Dismiss was brought up to the Court of Appeals by herein
petitioners in a petition for certiorari and prohibition. Said petition, docketed as CA-G.R. SP No. 66894,
alleged that the trial court gravely abused its discretion in ruling that the Republic of Indonesia gave its
consent to be sued and voluntarily submitted itself to the laws and jurisdiction of Philippine courts and that
petitioners Ambassador Soeratmin and Minister Counsellor Kasim waived their immunity from suit.
On May 30, 2002, the Court of Appeals rendered its assailed decision denying the petition for
lack of merit. 6 On August 16, 2002, it denied herein petitioners' motion for reconsideration. 7
Hence, this petition.
In the case at bar, petitioners raise the sole issue of whether or not the Court of Appeals erred in
sustaining the trial court's decision that petitioners have waived their immunity from suit by using as its
basis the abovementioned provision in the Maintenance Agreement.
The petition is impressed with merit.
International law is founded largely upon the principles of reciprocity, comity, independence, and
equality of States which were adopted as part of the law of our land under Article II, Section 2 of the 1987
Constitution. 8 The rule that a State may not be sued without its consent is a necessary consequence of the
principles of independence and equality of States. 9 As enunciated in Sanders v. Veridiano II, 10 the
practical justification for the doctrine of sovereign immunity is that there can be no legal right against the
authority that makes the law on which the right depends. In the case of foreign States, the rule is derived
from the principle of the sovereign equality of States, as expressed in the maxim par in parem non habet
imperium.All states are sovereign equals and cannot assert jurisdiction over one another. 11 A contrary
attitude would "unduly vex the peace of nations." 12
The rules of International Law, however, are neither unyielding nor impervious to change. The
increasing need of sovereign States to enter into purely commercial activities remotely connected with the
discharge of their governmental functions brought about a new concept of sovereign immunity. This
concept, the restrictive theory, holds that the immunity of the sovereign is recognized only with regard to
public acts or acts jure imperii,but not with regard to private acts or acts jure gestionis. 13
In United States v. Ruiz, 14 for instance, we held that the conduct of public bidding for the repair
of a wharf at a United States Naval Station is an act jure imperii.On the other hand, we considered as an
act jure gestionis the hiring of a cook in the recreation center catering to American servicemen and the
general public at the John Hay Air Station in Baguio City, 15 as well as the bidding for the operation of
barber shops in Clark Air Base in Angeles City. 16
Apropos the present case, the mere entering into a contract by a foreign State with a private
party cannot be construed as the ultimate test of whether or not it is an act jure imperii or jure
gestionis.Such act is only the start of the inquiry. Is the foreign State engaged in the regular conduct of a
business? If the foreign State is not engaged regularly in a business or commercial activity, and in this case
it has not been shown to be so engaged, the particular act or transaction must then be tested by its nature.
If the act is in pursuit of a sovereign activity, or an incident thereof, then it is an act jure imperii. 17
Hence, the existence alone, of a paragraph in a contract stating that any legal action arising out
of the agreement shall be settled according to the laws of the Philippines and by a specified court of the
Philippines is not necessarily a waiver of sovereign immunity from suit. The aforesaid provision contains
language not necessarily inconsistent with sovereign immunity. On the other hand, such provision may also
be meant to apply where the sovereign party elects to sue in the local courts, or otherwise waives its
immunity by any subsequent act. The applicability of Philippine laws must be deemed to include Philippine
laws in its totality, including the principle recognizing sovereign immunity. Hence, the proper court may
have no proper action, by way of settling the case, except to dismiss it. AEaSTC
Submission by a foreign state to local jurisdiction must be clear and unequivocal. It must be given
explicitly or by necessary implication. We find no such waiver in this case.
Respondent concedes that the establishment of a diplomatic mission is a sovereign function. On
the other hand, he argues that the actual physical maintenance of the premises of the diplomatic mission,
such as the upkeep of its furnishings and equipment, is no longer a sovereign function of the State. 18
by respondent, the Solicitor General states that it "was not a waiver of their immunity from suit but a mere
stipulation that in the event they do waive their immunity, Philippine laws shall govern the resolution of any
legal action arising out of the agreement and the proper court in Makati City shall be the agreed venue
thereof. 19
On the matter of whether or not petitioners Ambassador Soeratmin and Minister Counsellor
Kasim may be sued herein in their private capacities, Article 31 of the Vienna Convention on Diplomatic
Relations provides:
xxx xxx xxx
1. A diplomatic agent shall enjoy immunity from the criminal jurisdiction of
the receiving State. He shall also enjoy immunity from its civil and administrative
jurisdiction, except in the case of:
(a) a real action relating to private immovable property situated in the
territory of the receiving State, unless he holds it on behalf of the sending
State for the purposes of the mission;
(b) an action relating to succession in which the diplomatic agent is
involved as executor, administrator, heir or legatee as a private person
and not on behalf of the sending State;
(c) an action relating to any professional or commercial activity exercised
by the diplomatic agent in the receiving State outside his official
functions.
xxx xxx xxx
The act of petitioners Ambassador Soeratmin and Minister Counsellor Kasim in terminating the
Maintenance Agreement is not covered by the exceptions provided in the abovementioned provision.
The Solicitor General believes that said act may fall under subparagraph (c) thereof, 20 but said
provision clearly applies only to a situation where the diplomatic agent engages in any professional or
commercial activity outside official functions, which is not the case herein.
WHEREFORE, the petition is hereby GRANTED. The decision and resolution of the Court of
Appeals in CA G.R. SP No. 66894 are REVERSED and SET ASIDE and the complaint in Civil Case No.
18203 against petitioners is DISMISSED. EcIaTA
No costs.

We disagree. There is no dispute that the establishment of a diplomatic mission is an act jure SO ORDERED.
imperii.A sovereign State does not merely establish a diplomatic mission and leave it at that; the
Davide, Jr.,C.J.,Bellosillo, Puno, Vitug, Panganiban, Quisumbing, Ynares-Santiago,
establishment of a diplomatic mission encompasses its maintenance and upkeep. Hence, the State may
Sandoval-Gutierrez, Carpio, Corona, Carpio Morales, and Callejo, Sr.,JJ., concur.
enter into contracts with private entities to maintain the premises, furnishings and equipment of the
embassy and the living quarters of its agents and officials. It is therefore clear that petitioner Republic of Austria-Martinez, J., on official leave.
Indonesia was acting in pursuit of a sovereign activity when it entered into a contract with respondent for
the upkeep or maintenance of the air conditioning units, generator sets, electrical facilities, water heaters,
and water motor pumps of the Indonesian Embassy and the official residence of the Indonesian
ambassador. ||| (Republic of Indonesia v. Vinzon, G.R. No. 154705, [June 26, 2003], 452 PHIL 1100-1111)

The Solicitor General, in his Comment, submits the view that, "the Maintenance Agreement was
entered into by the Republic of Indonesia in the discharge of its governmental functions. In such a case, it
cannot be deemed to have waived its immunity from suit." As to the paragraph in the agreement relied upon
 THIRD DIVISION
[G.R. No. 178551. October 11, 2010.]
ATCI OVERSEAS CORPORATION, AMALIA G. IKDAL and MINISTRY OF
PUBLIC HEALTH-KUWAIT, petitioners, vs. MA. JOSEFA ECHIN, respondent.
DECISION
CARPIO MORALES, J p:
Josefina Echin (respondent) was hired by petitioner ATCI Overseas Corporation in behalf of
its principal-co-petitioner, the Ministry of Public Health of Kuwait (the Ministry), for the position of
medical technologist under a two-year contract, denominated as a Memorandum of Agreement
(MOA), with a monthly salary of US$1,200.00.
Under the MOA, 1 all newly-hired employees undergo a probationary period of one (1) year
and are covered by Kuwait's Civil Service Board Employment Contract No. 2.
Respondent was deployed on February 17, 2000 but was terminated from employment on
February 11, 2001, she not having allegedly passed the probationary period.
As the Ministry denied respondent's request for reconsideration, she returned to the
Philippines on March 17, 2001, shouldering her own air fare.
On July 27, 2001, respondent filed with the National Labor Relations Commission (NLRC) a
complaint 2 for illegal dismissal against petitioner ATCI as the local recruitment agency, represented
by petitioner, Amalia Ikdal (Ikdal), and the Ministry, as the foreign principal.
By Decision 3 of November 29, 2002, the Labor Arbiter, finding that petitioners neither
showed that there was just cause to warrant respondent's dismissal nor that she failed to qualify as a
regular employee, held that respondent was illegally dismissed and accordingly ordered petitioners to
pay her US$3,600.00, representing her salary for the three months unexpired portion of her contract.
On appeal of petitioners ATCI and Ikdal, the NLRC affirmed the Labor Arbiter's decision by
Resolution 4 of January 26, 2004. Petitioners' motion for reconsideration having been denied by
Resolution 5 of April 22, 2004, they appealed to the Court of Appeals, contending that their principal,
the Ministry, being a foreign government agency, is immune from suit and, as such, the immunity
extended to them; and that respondent was validly dismissed for her failure to meet the performance
rating within the one-year period as required under Kuwait's Civil Service Laws. Petitioners further
contended that Ikdal should not be liable as an officer of petitioner ATCI.
By Decision 6 of March 30, 2007, the appellate court affirmed the NLRC Resolution.
In brushing aside petitioners' contention that they only acted as agent of the Ministry and
that they cannot be held jointly and solidarily liable with it, the appellate court noted that under the law,
a private employment agency shall assume all responsibilities for the implementation of the contract
of employment of an overseas worker, hence, it can be sued jointly and severally with the foreign
principal for any violation of the recruitment agreement or contract of employment. ATcaHS
As to Ikdal's liability, the appellate court held that under Sec. 10 of Republic Act No. 8042,
the "Migrant and Overseas Filipinos' Act of 1995," corporate officers, directors and partners of a
recruitment agency may themselves be jointly and solidarily liable with the recruitment agency for
money claims and damages awarded to overseas workers.
Petitioners' motion for reconsideration having been denied by the appellate court by
Resolution 7 of June 27, 2007, the present petition for review on certiorariwas filed.
Petitioners maintain that they should not be held liable because respondent's employment
contract specifically stipulates that her employment shall be governed by the Civil Service Law and
Regulations of Kuwait. They thus conclude that it was patent error for the labor tribunals and the
appellate court to apply theLabor Code provisions governing probationary employment in deciding the
present case.
Further, petitioners argue that even the Philippine Overseas Employment Act (POEA)
Rules relative to master employment contracts (Part III, Sec. 2 of the POEA Rules and Regulations)
accord respect to the "customs, practices, company policies and labor laws and legislation of the host
country."
Finally, petitioners posit that assuming arguendo that Philippine labor laws are applicable,
given that the foreign principal is a government agency which is immune from suit, as in fact it did not
sign any document agreeing to be held jointly and solidarily liable, petitioner ATCI cannot likewise be
held liable, more so since the Ministry's liability had not been judicially determined as jurisdiction was
not acquired over it.
The petition fails.
Petitioner ATCI, as a private recruitment agency, cannot evade responsibility for the money
claims of Overseas Filipino workers (OFWs) which it deploys abroad by the mere expediency of
claiming that its foreign principal is a government agency clothed with immunity from suit, or that such
foreign principal's liability must first be established before it, as agent, can be held jointly and solidarily
liable.
In providing for the joint and solidary liability of private recruitment agencies with their
foreign principals, Republic Act No. 8042 precisely affords the OFWs with a recourse and assures
them of immediate and sufficient payment of what is due them. Skippers United Pacific v.
Maguad 8 explains:
. . . [T]he obligations covenanted in the recruitment agreement
entered into by and between the local agent and its foreign principal are not
coterminous with the term of such agreement so that if either or both of the
parties decide to end the agreement, the responsibilities of such parties towards the
contracted employees under the agreement do not at all end, but the same extends
up to and until the expiration of the employment contracts of the employees
recruited and employed pursuant to the said recruitment agreement. Otherwise,
this will render nugatory the very purpose for which the law governing the
employment of workers for foreign jobs abroad was enacted. (emphasis
supplied)
The imposition of joint and solidary liability is in line with the policy of the state to protect and alleviate
the plight of the working class. 9 Verily, to allow petitioners to simply invoke the immunity from suit of
its foreign principal or to wait for the judicial determination of the foreign principal's liability before
petitioner can be held liable renders the law on joint and solidary liability inutile.
As to petitioners' contentions that Philippine labor laws on probationary employment are not
applicable since it was expressly provided in respondent's employment contract, which she voluntarily
entered into, that the terms of her engagement shall be governed by prevailing Kuwaiti Civil Service
Laws and Regulations as in fact POEA Rules accord respect to such rules, customs and practices of
the host country, the same was not substantiated.
Indeed, a contract freely entered into is considered the law between the parties who can
establish stipulations, clauses, terms and conditions as they may deem convenient, including the laws
which they wish to govern their respective obligations, as long as they are not contrary to law, morals,
good customs, public order or public policy.
It is hornbook principle, however, that the party invoking the application of a foreign law has
the burden of proving the law, under the doctrine of processual presumption which, in this case,
petitioners failed to discharge. The Court's ruling in EDI-Staffbuilders Int'l. v. NLRC 10 illuminates:
In the present case, the employment contract signed by Gran
specifically states that Saudi Labor Laws will govern matters not provided for
in the contract (e.g., specific causes for termination, termination procedures, etc.).
Being the law intended by the parties (lex loci intentiones) to apply to the contract,
Saudi Labor Laws should govern all matters relating to the termination of the
employment of Gran. HcACTE
In international law, the party who wants to have a foreign law
applied to a dispute or case has the burden of proving the foreign law. The
foreign law is treated as a question of fact to be properly pleaded and proved
as the judge or labor arbiter cannot take judicial notice of a foreign law. He is
presumed to know only domestic or forum law.
Unfortunately for petitioner, it did not prove the pertinent Saudi
laws on the matter; thus, the International Law doctrine of presumed-identity
approach or processual presumption comes into play. Where a foreign law is
not pleaded or, even if pleaded, is not proved, the presumption is that foreign
law is the same as ours. Thus, we apply Philippine labor laws in determining
the issues presented before us. (emphasis and underscoring supplied)
The Philippines does not take judicial notice of foreign laws, hence, they must not only be
alleged; they must be proven. To prove a foreign law, the party invoking it must present a copy thereof
and comply with Sections 24 and 25 of Rule 132 of the Revised Rules of Court which reads:
SEC. 24. Proof of official record. — The record of public documents
referred to in paragraph (a) of Section 19, when admissible for any purpose, may be
evidenced by an official publication thereof or by a copy attested by the officer
having the legal custody of the record, or by his deputy, and accompanied, if the
record is not kept in the Philippines, with a certificate that such officer has the
custody. If the office in which the record is kept is in a foreign country, the
certificate may be made by a secretary of the embassy or legation, consul
general, consul, vice consul, or consular agent or by any officer in the foreign
service of the Philippines stationed in the foreign country in which the record
is kept, and authenticated by the seal of his office. (emphasis supplied)
SEC. 25. What attestation of copy must state. — Whenever a copy of a
document or record is attested for the purpose of the evidence, the attestation must
state, in substance, that the copy is a correct copy of the original, or a specific part
thereof, as the case may be. The attestation must be under the official seal of the
attesting officer, if there be any, or if he be the clerk of a court having a seal, under
the seal of such court.
To prove the Kuwaiti law, petitioners submitted the following: MOA between respondent
and the Ministry, as represented by ATCI, which provides that the employee is subject to a
probationary period of one (1) year and that the host country's Civil Service Laws and Regulations
apply; a translated copy 11 (Arabic to English) of the termination letter to respondent stating that she
did not pass the probation terms, without specifying the grounds therefor, and a translated copy of the
certificate of termination, 12 both of which documents were certified by Mr. Mustapha Alawi, Head of
the Department of Foreign Affairs-Office of Consular Affairs Inslamic Certification and Translation Unit;
and respondent's letter 13 of reconsideration to the Ministry, wherein she noted that in her first eight (8)
months of employment, she was given a rating of "Excellent" albeit it changed due to changes in her
shift of work schedule.
These documents, whether taken singly or as a whole, do not sufficiently prove that
respondent was validly terminated as a probationary employee under Kuwaiti civil service
laws. Instead of submitting a copy of the pertinent Kuwaiti labor laws duly authenticated and
translated by Embassy officials thereat, as required under the Rules, what petitioners
submitted were mere certifications attesting only to the correctness of the translations of the
MOA and the termination letter which does not prove at all that Kuwaiti civil service laws differ
from Philippine laws and that under such Kuwaiti laws, respondent was validly
terminated. Thus the subject certifications read:
xxx xxx xxx
This is to certify that the herein attached translation/s from Arabic to
English/Tagalog and or vice versa was/were presented to this Office for review and
certification and the same was/were found to be in order. This Office, however,
assumes no responsibility as to the contents of the document/s.
This certification is being issued upon request of the interested party for
whatever legal purpose it may serve. (emphasis supplied)
Respecting Ikdal's joint and solidary liability as a corporate officer, the same is in order too
following the express provision of R.A. 8042 on money claims, viz.:
SEC. 10. Money Claims. — Notwithstanding any provision of law to the
contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC)
shall have the original and exclusive jurisdiction to hear and decide, within ninety
(90) calendar days after the filing of the complaint, the claims arising out of an
employer-employee relationship or by virtue of any law or contract involving Filipino
workers for overseas deployment including claims for actual moral, exemplary and
other forms of damages. cHDAIS
The liability of the principal/employer and the recruitment/placement
agency for any and all claims under this section shall be joint and several. This
provision shall be incorporated in the contract for overseas employment and shall
be a condition precedent for its approval. The performance bond to be filed by the
recruitment/placement agency, as provided by law, shall be answerable for all
money claims or damages that may be awarded to the workers. If the
recruitment/placement agency is a juridical being, the corporate officers and
directors and partners as the case may be, shall themselves be jointly and
solidarily liable with the corporation or partnership for the aforesaid claims
and damages. (emphasis and underscoring supplied)
WHEREFORE, the petition is DENIED.
SO ORDERED.
 Brion, Bersamin, Villarama, Jr. and Sereno, JJ., concur.

||| (ATCI Overseas Corporation v. Echin, G.R. No. 178551, [October 11, 2010], 647 PHIL 43-52)
 FIRST DIVISION
[G.R. No. 156208. September 26, 2006.]
NPC DRIVERS AND MECHANICS ASSOCIATION, (NPC DAMA), represented
by Its President ROGER S. SAN JUAN, SR., NPC EMPLOYEES & WORKERS
UNION (NEWU) — NORTHERN LUZON REGIONAL CENTER, represented by
its Regional President JIMMY D. SALMAN, in their own individual capacities
and in behalf of the members of the associations and all affected officers and
employees of National Power Corporation (NPC), ZOL D. MEDINA, NARCISO
M. MAGANTE, VICENTE B. CIRIO, JR., NECITAS B. CAMAMA, in their
individual capacities as employees of National Power
Corporation, petitioners, vs. THE NATIONAL POWER CORPORATION (NPC),
NATIONAL POWER BOARD OF DIRECTORS (NPB), JOSE ISIDRO N.
CAMACHO as Chairman of the National Power Board of Directors (NPB),
ROLANDO S. QUILALA, as President — Officer-in-charge/CEO of National
Power Corporation and Member of National Power Board, and VINCENT S.
PEREZ, JR., EMILIA T. BONCODIN, MARIUS P. CORPUS, RUBEN S. REINOSO,
JR., GREGORY L. DOMINGO and NIEVES L. OSORIO, respondents.
DECISION
CHICO-NAZARIO, J p:
Before Us is a special civil action for Injunction to enjoin public respondents from
implementing the National Power Board (NPB) Resolutions No. 2002-124 and No. 2002-125, both
dated 18 November 2002, directing, among other things, the termination of all employees of the
National Power Corporation (NPC) on 31 January 2003 in line with the restructuring of the NPC.
On 8 June 2001, Republic Act No. 9136, otherwise known as the "Electric Power Industry
Reform Act of 2001" (EPIRA Law), was approved and signed into law by President Gloria
Macapagal-Arroyo, and took effect on 26 June 2001. Section 2(i) and Section 3 of the EPIRA
Law states:
Section 2. Declaration of Policy. — It is hereby declared the policy of the
State:
xxx xxx xxx
(i) To provide for an orderly and transparent privatization of the assets
and liabilities of the National Power Corporation (NPC);
xxx xxx xxx
Section 3. Scope. — This Act shall provide a framework for the
restructuring of the electric power industry, including the privatization of the assets
of NPC, the transition to the desired competitive structure, and the definition of the
responsibilities of the various government agencies and private entities. 1
Under the EPIRA Law, 2 a new National Power Board of Directors was constituted
composed of the Secretary of Finance as Chairman, with the Secretary of Energy, the Secretary of
Budget and Management, the Secretary of Agriculture, the Director-General of the National Economic
and Development Authority, the Secretary of Environment and Natural Resources, the Secretary of
Interior and Local Government, the Secretary of the Department of Trade and Industry, and the
President of the National Power Corporation as members.
On 27 February 2002, the Secretary of the Department of Energy (DOE) promulgated the
Implementing Rules and Regulations (IRR) of the EPIRA Law, pursuant to Section 77 3 thereof. Said
IRR were approved by the Joint Congressional Power Commission on even date. Meanwhile, also in
pursuant to the provisions of theEPIRA Law, the DOE created the Energy Restructuring Steering
Committee (Restructuring Committee) to manage the privatization and restructuring of the NPC, the
National Transmission Corporation (TRANSCO), and the Power Sector Assets and Liabilities
Corporation (PSALM). EICSDT
To serve as the overall organizational framework for the realigned functions of the NPC
mandated under the EPIRA Law, the Restructuring Committee proposed a new NPC Table of
Organization which was approved by the NPB through NPB Resolution No. 2002-53 dated 11 April
2002. Likewise, the Restructuring Committee reviewed the proposed 2002 NPC Restructuring Plan
and assisted in the implementation of Phase I (Realignment) of said Plan, and thereafter
recommended to the NPB for approval the adoption of measures pertaining to the separation and
hiring of NPC personnel. The NPB, taking into consideration the recommendation of the Restructuring
Committee, thus amended the Restructuring Plan approved under NPB Resolution No. 2002-53.
On 18 November 2002, pursuant to Section 63 4 of the EPIRA Law and Rule 33 5 of the
IRR, the NPB passed NPB Resolution No. 2002-124 which provided for the Guidelines on the
Separation Program of the NPC and the Selection and Placement of Personnel in the NPC Table of
Organization. Under said Resolution, all NPC personnel shall be legally terminated on 31 January
2003, and shall be entitled to separation benefits. On the same day, the NPB approved NPB
Resolution No. 2002-125, whereby a Transition Team was constituted to manage and implement the
NPC's Separation Program.
In a Memorandum dated 21 November 2002, the NPC OIC-President and CEO Rolando S.
Quilala circulated the assailed Resolutions and directed the concerned NPC officials to disseminate
and comply with said Resolutions and implement the same within the period provided for in the
timetable set in NPB Resolution No. 2002-125. As a result thereof, Mr. Paquito F. Garcia, Manager —
HRSD and Resources and Administration Coordinator of NPC, circulated a Memorandum dated 22
November 2002 to all NPC officials and employees providing for a checklist of the documents required
for securing clearances for the processing of separation benefits of all employees who shall be
terminated under the Restructuring Plan.
Contending that the assailed NPB Resolutions are void and without force and effect, herein
petitioners, in their individual and representative capacities, filed the present Petition for Injunction to
restrain respondents from implementing NPB Resolutions No. 2002-124 and No. 2002-125. In
support thereof, petitioners invoke Section 78 of the EPIRA Law, to wit:
Section 78. Injunction and Restraining Order. — The implementation of
the provisions of this Act shall not be restrained or enjoined except by an order
issued by the Supreme Court of the Philippines.
In assailing the validity of NPB Resolutions No. 2002-124 and No. 2002-125, petitioners
maintain that said Resolutions were not passed and issued by a majority of the members of the duly
constituted Board of Directors since only three of its members, as provided under Section 48 6 of
the EPIRA Law, were present, namely: DOE Secretary Vincent S. Perez, Jr.; Department of Budget
and Management Secretary Emilia T. Boncodin; and NPC OIC-President Rolando S. Quilala.
According to petitioners, the other four members who were present at the meeting and signed the
Resolutions were not the secretaries of their respective departments but were merely representatives
or designated alternates of the officials who were named under the EPIRA Law to sit as members of
the NPB. Petitioners claim that the acts of these representatives are violative of the well-settled
principle that "delegated power cannot be further delegated." Thus, petitioners conclude that the
questioned Resolutions have been illegally issued as it were not issued by a duly constituted board
since no quorum existed because only three of the nine members, as provided under Section 48 of
the EPIRA Law, were present and qualified to sit and vote. IHCDAS
It is petitioners' submission that even assuming arguendo that there was no undue
delegation of power to the four representatives who signed the assailed Resolutions, said Resolutions
cannot still be given legal effect because the same did not comply with the mandatory requirement of
endorsement by the Joint Congressional Power Commission and approval of the President of the
Philippines, as provided under Section 47 of the EPIRA Law which states that:
Section 47. NPC Privatization. — Except for the assets of SPUG, the
generation assets, real estate, and other disposable assets as well as IPP contracts
of NPC shall be privatized in accordance with this Act. Within six (6) months from
effectivity of this Act, the PSALM Corp. shall submit a plan for the endorsement by
the Joint Congressional Power Commission and the approval of the President of the
Philippines, on the total privatization of the generation assets, real estate, other
disposable assets as well as existing IPP contracts of NPC and thereafter,
implement the same, in accordance with the following guidelines, except as
provided for in paragraph (f) herein: . . . .
Petitioners insist that if ever there exists a valid wholesale abolition of their positions and
their concomitant separation form the service, such a process is an integral part of "privatization" and
"restructuring" as defined under the EPIRA Law and, therefore, must comply with the above-quoted
provision requiring the endorsement of the Joint Congressional Power Commission and the approval
of the President of the Philippines. Furthermore, petitioner highlight the fact that said Resolutions will
have an adverse effect on about 5,648 employees of the NPC and will result in the displacement of
some 2,370 employees, which, petitioners argue, is contrary to the mandate of the Constitution to
promote full employment and security of tenure.
Respondents, on the other hand, uphold the validity of the assailed Resolutions by arguing
that while it is true that four members of the National Power Board of Directors, particularly the
respective Secretaries of the Department of the Interior and Local Government, the Department of
Trade and Industry, and the Department of Finance, as well as the Director-General of the National
Economic and Development Authority, were not the actual signatories in NPB Resolutions No.
2002-124 and No. 2002-125, they were, however, ably represented by their respective alternates.
Respondents claim that the validity of such administrative practice whereby an authority is exercised
by persons or subordinates appointed by the responsible official has long been settled. Respondents
further contend that Section 48 of the EPIRA Law does not in any way prohibit any member of the
NPB from authorizing his representative to sign resolutions adopted by the Board.
From the arguments put forward by herein parties, it is evident that the pivotal issue to be
resolved in this Petition for Injunction is whether or not NPB Resolutions No. 2002-124 and No.
2002-125 were properly enacted. It is petitioners' contention that the failure of the four specifically
identified department heads 7under Section 48 of the EPIRA Law to personally approve and sign the
assailed Resolutions invalidates the adoption of said Resolutions. Petitioners maintain that there was
undue delegation of delegated power when only the representatives of certain members of the NPB
attended the board meetings and passed and signed the questioned Resolutions.
We agree with petitioners. In enumerating under Section 48 those who shall compose the
National Power Board of Directors, the legislature has vested upon these persons the power to
exercise their judgment and discretion in running the affairs of the NPC. Discretion may be defined as
"the act or the liberty to decide according to the principles of justice and one's ideas of what is right
and proper under the circumstances, without willfulness or favor. 8 Discretion, when applied to public
functionaries, means a power or right conferred upon them by law of acting officially in certain
circumstances, according to the dictates of their own judgment and conscience, uncontrolled by the
judgment or conscience of others. 9 It is to be presumed that in naming the respective department
heads as members of the board of directors, the legislature chose these secretaries of the various
executive departments on the basis of their personal qualifications and acumen which made them
eligible to occupy their present positions as department heads. Thus, the department secretaries
cannot delegate their duties as members of the NPB, much less their power to vote and approve
board resolutions, because it is their personal judgment that must be exercised in the fulfillment of
such responsibility. DTEHIA
There is no question that the enactment of the assailed Resolutions involves the exercise of
discretion and not merely a ministerial act that could be validly performed by a delegate, thus, the rule
enunciated in the case of Binamira v. Garrucho 10 is relevant in the present controversy, to wit:
An officer to whom a discretion is entrusted cannot delegate it to another,
the presumption being that he was chosen because he was deemed fit and
competent to exercise that judgment and discretion, and unless the power to
substitute another in his place has been given to him, he cannot delegate his duties
to another.
In those cases in which the proper execution of the office requires, on the
part of the officer, the exercise of judgment or discretion, the presumption is that he
was chosen because he was deemed fit and competent to exercise that judgment
and discretion, and, unless power to substitute another in his place has been given
to him, he cannot delegate his duties to another.
Respondents' assertion to the contrary is not tenable. The ruling in the case cited by
respondents to support their contention is not applicable in the case at bar. While it is true that the
Court has determined in the case of American Tobacco Company v. Director of Patents 11 that a
delegate may exercise his authority through persons he appoints to assist him in his functions, it must
be stressed that the Court explicitly stated in the same case that said practice is permissible only
when the judgment and discretion finally exercised are those of the officer authorized by law.
According to the Court, the rule that requires an administrative officer to exercise his own judgment
and discretion does not preclude him from utilizing, as a matter of practical administrative procedure,
the aid of subordinates, so long as it is the legally authorized official who makes the final
decision through the use of his own personal judgment.
In the case at bar, it is not difficult to comprehend that in approving NPB Resolutions No.
2002-124 and No. 2002-125, it is the representatives of the secretaries of the different executive
departments and not the secretaries themselves who exercised judgment in passing the assailed
Resolution, as shown by the fact that it is the signatures of the respective representatives that are
affixed to the questioned Resolutions. This, to our mind, violates the duty imposed upon the
specifically enumerated department heads to employ their own sound discretion in exercising the
corporate powers of the NPC. Evidently, the votes cast by these mere representatives in favor of the
adoption of the said Resolutions must not be considered in determining whether or not the necessary
 number of votes was garnered in order that the assailed Resolutions may be validly enacted. Hence, municipalities. 3 Maguindanao forms part of the Autonomous Region in Muslim Mindanao (ARMM),
there being only three valid votes cast out of the nine board members, namely those of DOE Secretary created under its Organic Act, Republic Act No. 6734 (R.A. 6734), as amended by Republic Act No.
Vincent S. Perez, Jr.; Department of Budget and Management Secretary Emilia T. Boncodin; and 9054 (R.A. 9054). 4 Although under the Ordinance, Cotabato City forms part of Maguindanao's first
NPC OIC-President Rolando S. Quilala, NPB Resolutions No. 2002-124 and No. 2002-125 are void legislative district, it is not part of the ARMM but of Region XII, having voted against its inclusion in the
and are of no legal effect. ARMM in the plebiscite held in November 1989. SDECAI
Having determined that the assailed Resolutions are void as they lack the necessary On 28 August 2006, the ARMM's legislature, the ARMM Regional Assembly, exercising its
number of votes for their adoption, We no longer deem it necessary to pass upon the other issues power to create provinces under Section 19, Article VI of R.A. 9054, 5enacted Muslim Mindanao
raised in the instant petition Autonomy Act No. 201 (MMA Act 201) creating the Province of Shariff Kabunsuan composed of the
eight municipalities in the first district of Maguindanao. MMA Act 201 provides:
WHEREFORE, premises considered, National Power Board Resolutions No. 2002-124 and
No. 2002-125 are hereby declared VOID and WITHOUT LEGAL EFFECT. The Petition for Injunction Section 1. The Municipalities of Barira, Buldon, Datu Odin Sinsuat,
is hereby GRANTED and respondents are hereby ENJOINED from implementing said NPB Kabuntalan, Matanog, Parang, Sultan Kudarat, Sultan Mastura, and Upi are hereby
Resolutions No. 2002-124 and No. 2002-125. aAHDIc separated from the Province of Maguindanao and constituted into a distinct and
independent province, which is hereby created, to be known as the Province of
SO ORDERED. Shariff Kabunsuan. TESICD
|
xxx xxx xxx
EN BANC
Sec. 5. The corporate existence of this province shall commence upon
the appointment by the Regional Governor or election of the governor and majority
of the regular members of the Sangguniang Panlalawigan.
[G.R. No. 177597. July 16, 2008.]
The incumbent elective provincial officials of the Province of
Maguindanao shall continue to serve their unexpired terms in the province that they
BAI SANDRA S. A. SEMA, petitioner, vs. COMMISSION ON ELECTIONS and will choose or where they are residents: Provided, that where an elective position in
DIDAGEN P. DILANGALEN, respondents. both provinces becomes vacant as a consequence of the creation of the Province of
Shariff Kabunsuan, all incumbent elective provincial officials shall have preference
for appointment to a higher elective vacant position and for the time being be
appointed by the Regional Governor, and shall hold office until their successors
[G.R. No. 178628. July 16, 2008.]
shall have been elected and qualified in the next local elections; Provided, further,
that they shall continue to receive the salaries they are receiving at the time of the
PERFECTO F. MARQUEZ, petitioner, vs. COMMISSION ON approval of this Act until the new readjustment of salaries in accordance with law.
ELECTIONS, respondent. Provided, furthermore, that there shall be no diminution in the number of the
members of the Sangguniang Panlalawigan of the mother province. acSECT

Except as may be provided by national law, the existing legislative district,

which includes Cotabato as a part thereof, shall remain.
DECISION
Later, three new municipalities 6 were carved out of the original nine municipalities constituting Shariff
Kabunsuan, bringing its total number of municipalities to 11. Thus, what was left of Maguindanao were
the municipalities constituting its second legislative district. Cotabato City, although part of
CARPIO, J p: Maguindanao's first legislative district, is not part of the Province of Maguindanao. ICDSca
The voters of Maguindanao ratified Shariff Kabunsuan's creation in a plebiscite held on 29
The Case October 2006.
These consolidated petitions 1 seek to annul Resolution No. 7902, dated 10 May 2007, of On 6 February 2007, the Sangguniang Panlungsod of Cotabato City passed Resolution No.
the Commission on Elections (COMELEC) treating Cotabato City as part of the legislative district of 3999 requesting the COMELEC to "clarify the status of Cotabato City in view of the conversion of the
the Province of Shariff Kabunsuan. 2 First District of Maguindanao into a regular province" under MMA Act 201. CHIEDS
The Facts In answer to Cotabato City's query, the COMELEC issued Resolution No. 07-0407 on 6
March 2007 "maintaining the status quo with Cotabato City as part of Shariff Kabunsuan in the First
The Ordinance appended to the 1987 Constitution apportioned two legislative districts for Legislative District of Maguindanao". Resolution No. 07-0407, which adopted the recommendation of
the Province of Maguindanao. The first legislative district consists of Cotabato City and eight
the COMELEC's Law Department under a Memorandum dated 27 February 2007, 7 provides in
pertinent parts:
Considering the foregoing, the Commission RESOLVED, as it hereby
resolves, to adopt the recommendation of the Law Department that pending the
enactment of the appropriate law by Congress, to maintain the status quo with
Cotabato City as part of Shariff Kabunsuan in the First Legislative District of
Maguindanao. (Emphasis supplied) aScIAC
However, in preparation for the 14 May 2007 elections, the COMELEC promulgated on 29
March 2007 Resolution No. 7845 stating that Maguindanao's first legislative district is composed only
of Cotabato City because of the enactment of MMA Act 201. 8
On 10 May 2007, the COMELEC issued Resolution No. 7902, subject of these petitions,
amending Resolution No. 07-0407 by renaming the legislative district in question as "Shariff
Kabunsuan Province with Cotabato City (formerly First District of Maguindanao with Cotabato City)." 9
In G.R. No. 177597, Sema, who was a candidate in the 14 May 2007 elections for
Representative of "Shariff Kabunsuan with Cotabato City", prayed for the nullification of COMELEC
Resolution No. 7902 and the exclusion from canvassing of the votes cast in Cotabato City for that
office. Sema contended that Shariff Kabunsuan is entitled to one representative in Congress under
Section 5 (3), Article VI of the Constitution 10 and Section 3 of the Ordinance appended to
theConstitution. 11 Thus, Sema asserted that the COMELEC acted without or in excess of its
jurisdiction in issuing Resolution No. 7902 which maintained the status quo in Maguindanao's first
legislative district despite the COMELEC's earlier directive in Resolution No. 7845 designating
Cotabato City as the lone component of Maguindanao's reapportioned first legislative
district. 12 Sema further claimed that in issuing Resolution No. 7902, the COMELEC usurped
Congress' power to create or reapportion legislative districts. CHDAaS
In its Comment, the COMELEC, through the Office of the Solicitor General (OSG), chose
not to reach the merits of the case and merely contended that (1) Sema wrongly availed of the writ
of certiorari to nullify COMELEC Resolution No. 7902 because the COMELEC issued the same in the
exercise of its administrative, not quasi-judicial, power and (2) Sema's prayer for the writ of prohibition
in G.R. No. 177597 became moot with the proclamation of respondent Didagen P. Dilangalen
(respondent Dilangalen) on 1 June 2007 as representative of the legislative district of Shariff
Kabunsuan Province with Cotabato City.
In his Comment, respondent Dilangalen countered that Sema is estopped from questioning
COMELEC Resolution No. 7902 because in her certificate of candidacy filed on 29 March 2007, Sema
indicated that she was seeking election as representative of "Shariff Kabunsuan including Cotabato
City". Respondent Dilangalen added that COMELEC Resolution No. 7902 is constitutional because it
did not apportion a legislative district for Shariff Kabunsuan or reapportion the legislative districts in
Maguindanao but merely renamed Maguindanao's first legislative district. Respondent Dilangalen
further claimed that the COMELEC could not reapportion Maguindanao's first legislative district to
make Cotabato City its sole component unit as the power to reapportion legislative districts lies
exclusively with Congress, not to mention that Cotabato City does not meet the minimum population
requirement under Section 5 (3), Article VI of the Constitution for the creation of a legislative district
within a city. 13
Sema filed a Consolidated Reply controverting the matters raised in respondents'
Comments and reiterating her claim that the COMELEC acted ultra vires in issuing Resolution No.
7902. HAaScT
In the Resolution of 4 September 2007, the Court required the parties in G.R. No. 177597 to
comment on the issue of whether a province created by the ARMM Regional Assembly under Section
19, Article VI of R.A. 9054 is entitled to one representative in the House of Representatives without
need of a national law creating a legislative district for such new province. The parties submitted their
compliance as follows:
(1) Sema answered the issue in the affirmative on the following grounds: (a) the Court
in Felwa v. Salas 14 stated that "when a province is created by statute, the corresponding
representative district comes into existence neither by authority of that statute — which cannot
provide otherwise — nor by apportionment, but by operation of the Constitution, without a
reapportionment;" (b) Section 462 of Republic Act No. 7160 (R.A. 7160) "affirms" the apportionment
of a legislative district incident to the creation of a province; and (c) Section 5 (3), Article VI of the
Constitution and Section 3 of the Ordinance appended to the Constitution mandate the
apportionment of a legislative district in newly created provinces. aSDHCT
(2) The COMELEC, again represented by the OSG, apparently abandoned its earlier
stance on the propriety of issuing Resolution Nos. 07-0407 and 7902 and joined causes with Sema,
contending that Section 5 (3), Article VI of the Constitution is "self-executing". Thus, every new
province created by the ARMM Regional Assembly is ipso facto entitled to one representative in the
House of Representatives even in the absence of a national law; and
(3) Respondent Dilangalen answered the issue in the negative on the following grounds: (a)
the "province" contemplated in Section 5 (3), Article VI of theConstitution is one that is created by an
act of Congress taking into account the provisions in R.A. 7160 on the creation of provinces; (b)
Section 3, Article IV of R.A. 9054 withheld from the ARMM Regional Assembly the power to enact
measures relating to national elections, which encompasses the apportionment of legislative districts
for members of the House of Representatives; (c) recognizing a legislative district in every province
the ARMM Regional Assembly creates will lead to the disproportionate representation of the ARMM in
the House of Representatives as the Regional Assembly can create provinces without regard to the
requirements in Section 461 of R.A. 7160; and (d) Cotabato City, which has a population of less than
250,000, is not entitled to a representative in the House of Representatives. TcaAID
On 27 November 2007, the Court heard the parties in G.R. No. 177597 in oral arguments
on the following issues: (1) whether Section 19, Article VI of R.A. 9054, delegating to the ARMM
Regional Assembly the power to create provinces, is constitutional; and (2) if in the affirmative,
whether a province created under Section 19, Article VI of R.A. 9054 is entitled to one representative
in the House of Representatives without need of a national law creating a legislative district for such
new province. 15
In compliance with the Resolution dated 27 November 2007, the parties in G.R. No. 177597
filed their respective Memoranda on the issues raised in the oral arguments. 16 On the question of the
constitutionality of Section 19, Article VI of R.A. 9054, the parties in G.R. No. 177597 adopted the
following positions: CITcSH
(1) Sema contended that Section 19, Article VI of R.A. 9054 is constitutional (a) as a valid
delegation by Congress to the ARMM of the power to create provinces under Section 20 (9), Article X
of the Constitution granting to the autonomous regions, through their organic acts, legislative powers
over "other matters as may be authorized by law for the promotion of the general welfare of the people
of the region" and (b) as an amendment to Section 6 of R.A. 7160. 17 However, Sema concedes that,
if taken literally, the grant in Section 19, Article VI of R.A. 9054 to the ARMM Regional Assembly of the
power to "prescribe standards lower than those mandated" in R.A. 7160 in the creation of provinces
contravenes Section 10, Article X of the Constitution. 18 Thus, Sema proposed that Section 19
"should be construed as prohibiting the Regional Assembly from prescribing standards . . . that do not
comply with the minimum criteria " under R.A. 7160. 19
(2) Respondent Dilangalen contended that Section 19, Article VI of R.A. 9054 is
unconstitutional on the following grounds: (a) the power to create provinces was not among those
granted to the autonomous regions under Section 20, Article X of the Constitution and (b) the grant
under Section 19, Article VI of R.A. 9054 to the ARMM Regional Assembly of the power to prescribe
standards lower than those mandated in Section 461 of R.A. 7160 on the creation of provinces
contravenes Section 10, Article X of the Constitution and the Equal Protection Clause; and EHCcIT
(3) The COMELEC, through the OSG, joined causes with respondent Dilangalen (thus
effectively abandoning the position the COMELEC adopted in its Compliance with the Resolution of 4
September 2007) and contended that Section 19, Article VI of R.A. 9054 is unconstitutional because
(a) it contravenes Section 10 and Section 6, 20 Article X of the Constitution and (b) the power to
create provinces was withheld from the autonomous regions under Section 20, Article X of
theConstitution.
On the question of whether a province created under Section 19, Article VI of R.A. 9054 is
entitled to one representative in the House of Representatives without need of a national law creating
a legislative district for such new province, Sema and respondent Dilangalen reiterated in their
Memoranda the positions they adopted in their Compliance with the Resolution of 4 September 2007.
The COMELEC deemed it unnecessary to submit its position on this issue considering its stance that
Section 19, Article VI of R.A. 9054 is unconstitutional. CcTIDH
The pendency of the petition in G.R. No. 178628 was disclosed during the oral arguments
on 27 November 2007. Thus, in the Resolution of 19 February 2008, the Court ordered G.R. No.
178628 consolidated with G.R. No. 177597. The petition in G.R. No. 178628 echoed Sema's
contention that the COMELEC acted ultra viresin issuing Resolution No. 7902 depriving the voters of
Cotabato City of a representative in the House of Representatives. In its Comment to the petition in
G.R. No. 178628, the COMELEC, through the OSG, maintained the validity of COMELEC Resolution
No. 7902 as a temporary measure pending the enactment by Congress of the "appropriate law".
The Issues
The petitions raise the following issues:
I. In G.R. No. 177597:
(A) Preliminarily —
(1) whether the writs of Certiorari, Prohibition, and Mandamus are proper to test the
constitutionality of COMELEC Resolution No. 7902; and TIHDAa
(2) whether the proclamation of respondent Dilangalen as representative of Shariff
Kabunsuan Province with Cotabato City mooted the petition in G.R. No. 177597.
(B) On the merits —
(1) whether Section 19, Article VI of R.A. 9054, delegating to the ARMM Regional
Assembly the power to create provinces, cities, municipalities and barangays, is constitutional;
and cSIADa
(2) if in the affirmative, whether a province created by the ARMM Regional Assembly under
MMA Act 201 pursuant to Section 19, Article VI of R.A. 9054 is entitled to one representative in the
House of Representatives without need of a national law creating a legislative district for such
province.
II. In G.R. No. 177597 and G.R. No. 178628, whether COMELEC Resolution No. 7902 is
valid for maintaining the status quo in the first legislative district of Maguindanao (as "Shariff
Kabunsuan Province with Cotabato City [formerly First District of Maguindanao with Cotabato City]"),
despite the creation of the Province of Shariff Kabunsuan out of such district (excluding Cotabato
City). DCaSHI
The Ruling of the Court
The petitions have no merit. We rule that (1) Section 19, Article VI of R.A. 9054 is
unconstitutional insofar as it grants to the ARMM Regional Assembly the power to create provinces
and cities; (2) MMA Act 201 creating the Province of Shariff Kabunsuan is void; and (3) COMELEC
Resolution No. 7902 is valid.
On the Preliminary Matters
The Writ of Prohibition is Appropriate
to Test the Constitutionality of
Election Laws, Rules and Regulations
The purpose of the writ of Certiorari is to correct grave abuse of discretion by "any tribunal,
board, or officer exercising judicial or quasi-judicial functions." 21On the other hand, the writ
of Mandamus will issue to compel a tribunal, corporation, board, officer, or person to perform an act
"which the law specifically enjoins as a duty." 22 True, the COMELEC did not issue Resolution No.
7902 in the exercise of its judicial or quasi-judicial functions. 23 Nor is there a law which specifically
enjoins the COMELEC to exclude from canvassing the votes cast in Cotabato City for representative
of "Shariff Kabunsuan Province with Cotabato City". These, however, do not justify the outright
dismissal of the petition in G.R. No. 177597 because Sema also prayed for the issuance of the writ of
Prohibition and we have long recognized this writ as proper for testing the constitutionality of election
laws, rules, and regulations. 24 2005jur
Respondent Dilangalen's Proclamation
Does Not Moot the Petition
There is also no merit in the claim that respondent Dilangalen's proclamation as winner in
the 14 May 2007 elections for representative of "Shariff Kabunsuan Province with Cotabato City"
mooted this petition. This case does not concern respondent Dilangalen's election. Rather, it involves
an inquiry into the validity of COMELEC Resolution No. 7902, as well as the constitutionality of MMA
Act 201 and Section 19, Article VI of R.A. 9054. Admittedly, the outcome of this petition, one way or
another, determines whether the votes cast in Cotabato City for representative of the district of "Shariff
Kabunsuan Province with Cotabato City" will be included in the canvassing of ballots. However, this
incidental consequence is no reason for us not to proceed with the resolution of the novel issues
raised here. The Court's ruling in these petitions affects not only the recently concluded elections but
also all the other succeeding elections for the office in question, as well as the power of the ARMM
Regional Assembly to create in the future additional provinces.
On the Main Issues
Whether the ARMM Regional Assembly
Can Create the Province of Shariff Kabunsuan
The creation of local government units is governed by Section 10, Article X of the
Constitution, which provides:
Sec. 10. No province, city, municipality, or barangay may be created,
divided, merged, abolished or its boundary substantially altered except in
accordance with the criteria established in the local government code and subject
to approval by a majority of the votes cast in a plebiscite in the political units directly
affected. EcSCAD
Thus, the creation of any of the four local government units — province, city, municipality or barangay
— must comply with three conditions. First, the creation of a local government unit must follow the
criteria fixed in the Local Government Code. Second, such creation must not conflict with any
provision of the Constitution. Third, there must be a plebiscite in the political units affected.
There is neither an express prohibition nor an express grant of authority in the
Constitution for Congress to delegate to regional or local legislative bodies the power to create local
government units. However, under its plenary legislative powers, Congress can delegate to local
legislative bodies the power to create local government units, subject to reasonable standards and
provided no conflict arises with any provision of the Constitution. In fact, Congress has delegated to
provincial boards, and city and municipal councils, the power to create barangays within their
jurisdiction, 25 subject to compliance with the criteria established in theLocal Government Code, and
the plebiscite requirement in Section 10, Article X of the Constitution. However, under the Local
Government Code, "only . . . an Act of Congress" can create provinces, cities or
municipalities. 26 EIaDHS
Under Section 19, Article VI of R.A. 9054, Congress delegated to the ARMM Regional
Assembly the power to create provinces, cities, municipalities and barangays within the ARMM.
Congress made the delegation under its plenary legislative powers because the power to create local
government units is not one of the express legislative powers granted by the Constitution to regional
legislative bodies. 27 In the present case, the question arises whether the delegation to the ARMM
Regional Assembly of the power to create provinces, cities, municipalities and barangays conflicts
with any provision of the Constitution.
There is no provision in the Constitution that conflicts with the delegation to regional
legislative bodies of the power to create municipalities and barangays, provided Section 10, Article X
of the Constitution is followed. However, the creation of provinces and cities is another matter.
Section 5 (3), Article VI of theConstitution provides, "Each city with a population of at least two
hundred fifty thousand, or each province, shall have at least one representative" in the House of
Representatives. Similarly, Section 3 of the Ordinance appended to the Constitution provides, "Any
province that may hereafter be created, or any city whose population may hereafter increase to more
than two hundred fifty thousand shall be entitled in the immediately following election to at least one
Member . . . " ADaSEH
Clearly, a province cannot be created without a legislative district because it will violate
Section 5 (3), Article VI of the Constitution as well as Section 3 of the Ordinance appended to the
Constitution. For the same reason, a city with a population of 250,000 or more cannot also be created
without a legislative district. Thus, the power to create a province, or a city with a population of
250,000 or more, requires also the power to create a legislative district. Even the creation of a city with
a population of less than 250,000 involves the power to create a legislative district because once the
city's population reaches 250,000, the city automatically becomes entitled to one representative under
Section 5 (3), Article VI of the Constitution and Section 3 of the Ordinance appended to the
Constitution. Thus, the power to create a province or city inherently involves the power to
create a legislative district.
For Congress to delegate validly the power to create a province or city, it must also validly
delegate at the same time the power to create a legislative district. The threshold issue then is, can
Congress validly delegate to the ARMM Regional Assembly the power to create legislative districts for
the House of Representatives? The answer is in the negative. HCaIDS
Legislative Districts are Created or Reapportioned
Only by an Act of Congress
Under the present Constitution, as well as in past 28 Constitutions, the power to increase
the allowable membership in the House of Representatives, and to reapportion legislative districts, is
vested exclusively in Congress. Section 5, Article VI of the Constitution provides:
SECTION 5. (1) The House of Representatives shall be composed of
not more than two hundred and fifty members, unless otherwise fixed by law,
who shall be elected from legislative districts apportioned among the provinces,
cities, and the Metropolitan Manila area in accordance with the number of their
respective inhabitants, and on the basis of a uniform and progressive ratio, and
those who, as provided by law, shall be elected through a party-list system of
registered national, regional, and sectoral parties or organizations. TEHIaA
xxx xxx xxx
(3) Each legislative district shall comprise, as far as practicable,
contiguous, compact, and adjacent territory. Each city with a population of at least
two hundred fifty thousand, or each province, shall have at least one representative.
(4) Within three years following the return of every census, the
Congress shall make a reapportionment of legislative districts based on the
standards provided in this section. (Emphasis supplied) ECaAHS
Section 5 (1), Article VI of the Constitution vests in Congress the power to increase,
through a law, the allowable membership in the House of Representatives. Section 5 (4) empowers
Congress to reapportion legislative districts. The power to reapportion legislative districts necessarily
includes the power to create legislative districts out of existing ones. Congress exercises these
powers through a law that Congress itself enacts, and not through a law that regional or local
legislative bodies enact. The allowable membership of the House of Representatives can be
increased, and new legislative districts of Congress can be created, only through a national law
passed by Congress. In Montejo v. COMELEC 29 we held that the "power of redistricting . . . is
traditionally regarded as part of the power (of Congress) to make laws", and thus is vested exclusively
in Congress.
This textual commitment to Congress of the exclusive power to create or reapportion
legislative districts is logical. Congress is a national legislature and any increase in its allowable
membership or in its incumbent membership through the creation of legislative districts must be
embodied in a national law. Only Congress can enact such a law. It would be anomalous for regional
or local legislative bodies to create or reapportion legislative districts for a national legislature like
Congress. An inferior legislative body, created by a superior legislative body, cannot change the
membership of the superior legislative body. SaCDTA
The creation of the ARMM, and the grant of legislative powers to its Regional Assembly
under its organic act, did not divest Congress of its exclusive authority to create legislative districts.
This is clear from the Constitution and the ARMM Organic Act, as amended. Thus, Section 20, Article
X of the Constitution provides:
SECTION 20. Within its territorial jurisdiction and subject to the
provisions of this Constitution and national laws, the organic act of autonomous
regions shall provide for legislative powers over: ASaTHc
(1) Administrative organization;
(2) Creation of sources of revenues;
(3) Ancestral domain and natural resources;
(4) Personal, family, and property relations;
(5) Regional urban and rural planning development;
 (6) Economic, social, and tourism development;
(7) Educational policies;
(8) Preservation and development of the cultural heritage; and
(9) Such other matters as may be authorized by law for the promotion of
the general welfare of the people of the region. DEcTCa
Nothing in Section 20, Article X of the Constitution authorizes autonomous regions,
expressly or impliedly, to create or reapportion legislative districts for Congress.
On the other hand, Section 3, Article IV of R.A. 9054 amending the ARMM Organic Act,
provides, "The Regional Assembly may exercise legislative power . . . except on the following
matters: . . . (k) National elections. . . . ." Since the ARMM Regional Assembly has no legislative
power to enact laws relating to national elections, it cannot create a legislative district whose
representative is elected in national elections. Whenever Congress enacts a law creating a legislative
district, the first representative is always elected in the "next national elections" from the effectivity of
the law. 30 ADCTac
Indeed, the office of a legislative district representative to Congress is a national office,
and its occupant, a Member of the House of Representatives, is anational official. 31 It would be
incongruous for a regional legislative body like the ARMM Regional Assembly to create a national
office when its legislative powers extend only to its regional territory. The office of a district
representative is maintained by national funds and the salary of its occupant is paid out of national
funds. It is a self-evident inherent limitation on the legislative powers of every local or regional
legislative body that it can only create local or regional offices, respectively, and it can never create a
national office.
To allow the ARMM Regional Assembly to create a national office is to allow its legislative
powers to operate outside the ARMM's territorial jurisdiction. This violates Section 20, Article X of
the Constitution which expressly limits the coverage of the Regional Assembly's legislative
powers "[w]ithin its territorial jurisdiction . . . ." SHEIDC
The ARMM Regional Assembly itself, in creating Shariff Kabunsuan, recognized the
exclusive nature of Congress' power to create or reapportion legislative districts by abstaining from
creating a legislative district for Shariff Kabunsuan. Section 5 of MMA Act 201 provides that:
Except as may be provided by national law, the existing legislative
district, which includes Cotabato City as a part thereof, shall remain. (Emphasis
supplied) aTIAES
However, a province cannot legally be created without a legislative district because the
Constitution mandates that "each province shall have at least one representative." Thus, the creation
of the Province of Shariff Kabunsuan without a legislative district is unconstitutional.
Sema, petitioner in G.R. No. 177597, contends that Section 5 (3), Article VI of the
Constitution, which provides:
Each legislative district shall comprise, as far as practicable, contiguous,
compact, and adjacent territory. Each city with a population of at least two
hundred fifty thousand, or each province, shall have at least one
representative. (Emphasis supplied) aCTcDH
and Section 3 of the Ordinance appended to the Constitution, which states:
Any province that may hereafter be created, or any city whose
population may hereafter increase to more than two hundred fifty thousand
shall be entitled in the immediately following election to at least one Member
or such number of Members as it may be entitled to on the basis of the
number of its inhabitants and according to the standards set forth in
paragraph (3), Section 5 of Article VI of the Constitution. The number of
Members apportioned to the province out of which such new province was created
or where the city, whose population has so increased, is geographically located
shall be correspondingly adjusted by the Commission on Elections but such
adjustment shall not be made within one hundred and twenty days before the
election. (Emphasis supplied) EASCDH
serve as bases for the conclusion that the Province of Shariff Kabunsuan, created on 29 October 2006,
is automatically entitled to one member in the House of Representatives in the 14 May 2007 elections.
As further support for her stance, petitioner invokes the statement in Felwa that "when a province is
created by statute, the corresponding representative district comes into existence neither by authority
of that statute — which cannot provide otherwise — nor by apportionment, but by operation of the
Constitution, without a reapportionment."
The contention has no merit.
First. The issue in Felwa, among others, was whether Republic Act No. 4695 (R.A. 4695),
creating the provinces of Benguet, Mountain Province, Ifugao, and Kalinga-Apayao and providing for
congressional representation in the old and new provinces, was unconstitutional for "creati[ng]
congressional districts without the apportionment provided in the Constitution." The Court answered
in the negative, thus: caHCSD
The Constitution ordains:
"The House of Representatives shall be composed of not more than one
hundred and twenty Members who shall be apportioned among the several
provinces as nearly as may be according to the number of their respective
inhabitants, but each province shall have at least one Member. The Congress shall
by law make an apportionment within three years after the return of every
enumeration, and not otherwise. Until such apportionment shall have been made,
the House of Representatives shall have the same number of Members as that
fixed by law for the National Assembly, who shall be elected by the qualified
electors from the present Assembly districts. Each representative district shall
comprise as far as practicable, contiguous and compact territory."
Pursuant to this Section, a representative district may come into
existence: (a) indirectly, through the creation of a province — for "each
province shall have at least one member" in the House of Representatives; or
(b) by direct creation of several representative districts within a province. The
requirements concerning the apportionment of representative districts and the
territory thereof refer only to the second method of creation of representative
districts, and do not apply to those incidental to the creation of provinces, under the
first method. This is deducible, not only from the general tenor of the provision
above quoted, but, also, from the fact that the apportionment therein alluded to
refers to that which is made by an Act of Congress. Indeed, when a province is
created by statute, the corresponding representative district, comes into
existence neither by authority of that statute — which cannot provide
otherwise — nor by apportionment, but by operation of the Constitution,
without a reapportionment. cSaCDT
 There is no constitutional limitation as to the time when, territory of, or
other conditions under which a province may be created, except, perhaps, if the
consequence thereof were to exceed the maximum of 120 representative districts
prescribed in the Constitution, which is not the effect of the legislation under
consideration. As a matter of fact, provinces have been created or subdivided into
other provinces, with the consequent creation of additional representative districts,
without complying with the aforementioned requirements. 32 (Emphasis supplied)
Thus, the Court sustained the constitutionality of R.A. 4695 because (1) it validly created
legislative districts "indirectly" through a special law enacted by Congress creating a
province and (2) the creation of the legislative districts will not result in breaching the maximum
number of legislative districts provided under the 1935 Constitution. Felwa does not apply to the
present case because in Felwa the new provinces were created by a national law enacted by
Congress itself.Here, the new province was created merely by a regional law enacted by the
ARMM Regional Assembly. SDECAI
What Felwa teaches is that the creation of a legislative district by Congress does not
emanate alone from Congress' power to reapportion legislative districts, but also from Congress'
power to create provinces which cannot be created without a legislative district. Thus, when a
province is created, a legislative district is created by operation of the Constitution because the
Constitution provides that "each province shall have at least one representative" in the House
of Representatives. This does not detract from the constitutional principle that the power to create
legislative districts belongs exclusively to Congress. It merely prevents any other legislative body,
except Congress, from creating provinces because for a legislative body to create a province such
legislative body must have the power to create legislative districts. In short, only an act of Congress
can trigger the creation of a legislative district by operation of the Constitution. Thus, only Congress
has the power to create, or trigger the creation of, a legislative district.
Moreover, if as Sema claims MMA Act 201 apportioned a legislative district to Shariff
Kabunsuan upon its creation, this will leave Cotabato City as the lone component of the first legislative
district of Maguindanao. However, Cotabato City cannot constitute a legislative district by itself
because as of the census taken in 2000, it had a population of only 163,849. To constitute Cotabato
City alone as the surviving first legislative district of Maguindanao will violate Section 5 (3), Article VI of
the Constitution which requires that "[E]ach city with a population of at least two hundred fifty
thousand . . ., shall have at least one representative." EacHSA
Second. Sema's theory also undermines the composition and independence of the House
of Representatives. Under Section 19, 33 Article VI of R.A. 9054, the ARMM Regional Assembly can
create provinces and cities within the ARMM with or without regard to the criteria fixed in Section
461 of R.A. 7160, namely: minimum annual income of P20,000,000, and minimum contiguous
territory of 2,000 square kilometers or minimum population of 250,000. 34 The following scenarios
thus become distinct possibilities:
(1) An inferior legislative body like the ARMM Regional Assembly can
create 100 or more provinces and thus increase the membership of a superior
legislative body, the House of Representatives, beyond the maximum limit of 250
fixed in the Constitution (unless a national law provides otherwise); SHCaDA
(2) The proportional representation in the House of Representatives
based on one representative for at least every 250,000 residents will be negated
because the ARMM Regional Assembly need not comply with the requirement in
Section 461 (a) (ii) of R.A. 7160 that every province created must have a population
of at least 250,000; and
(3) Representatives from the ARMM provinces can become the majority
in the House of Representatives through the ARMM Regional Assembly's
continuous creation of provinces or cities within the ARMM. IHEaAc
The following exchange during the oral arguments of the petition in G.R. No. 177597
highlights the absurdity of Sema's position that the ARMM Regional Assembly can create provinces:
Justice Carpio:
So, you mean to say [a] Local Government can create legislative district[s]
and pack Congress with their own representatives [?] CIaHDc
Atty. Vistan II: 35
Yes, Your Honor, because the Constitution allows that.
Justice Carpio:
So, [the] Regional Assembly of [the] ARMM can create and create . . .
provinces . . . and, therefore, they can have thirty-five (35) new
representatives in the House of Representatives without Congress
agreeing to it, is that what you are saying? That can be done, under your
theory[?] cDAISC
Atty. Vistan II:
Yes, Your Honor, under the correct factual circumstances.
Justice Carpio:
Under your theory, the ARMM legislature can create thirty-five (35) new
provinces, there may be . . . [only] one hundred thousand (100,000)
[population], . . ., and they will each have one representative . . . to
Congress without any national law, is that what you are saying? ITSaHC
Atty. Vistan II:
Without law passed by Congress, yes, Your Honor, that is what we are
saying.
xxx xxx xxx
Justice Carpio:
So, they can also create one thousand (1000) new provinces, sen[d]
one thousand (1000) representatives to the House of
Representatives without a national law[,] that is legally possible,
correct?
Atty. Vistan II:
Yes, Your Honor. 36 (Emphasis supplied)
Neither the framers of the 1987 Constitution in adopting the provisions in Article X on
regional autonomy, 37 nor Congress in enacting R.A. 9054, envisioned or intended these disastrous
consequences that certainly would wreck the tri-branch system of government under our Constitution.
Clearly, the power to create or reapportion legislative districts cannot be delegated by Congress but
must be exercised by Congress itself. Even the ARMM Regional Assembly recognizes this. ESTcIA
The Constitution empowered Congress to create or reapportion legislative districts, not the
regional assemblies. Section 3 of the Ordinance to the Constitutionwhich states, "[A]ny province that
may hereafter be created . . . shall be entitled in the immediately following election to at least one
Member", refers to a province created by Congress itself through a national law. The reason is that the
creation of a province increases the actual membership of the House of Representatives, an increase
that only Congress can decide. Incidentally, in the present 14th Congress, there are 219 38 district
representatives out of the maximum 250 seats in the House of Representatives. Since party-list
members shall constitute 20 percent of total membership of the House, there should at least be 50
party-list seats available in every election in case 50 party-list candidates are proclaimed winners.
This leaves only 200 seats for district representatives, much less than the 219 incumbent district
representatives. Thus, there is a need now for Congress to increase by law the allowable membership
of the House, even before Congress can create new provinces.
It is axiomatic that organic acts of autonomous regions cannot prevail over the Constitution.
Section 20, Article X of the Constitution expressly provides that the legislative powers of regional
assemblies are limited "[w]ithin its territorial jurisdiction and subject to the provisions of the
Constitution and national laws, . . . ." The Preamble of the ARMM Organic Act (R.A. 9054) itself
states that the ARMM Government is established "within the framework of the Constitution". This
follows Section 15, Article X of the Constitution which mandates that the ARMM "shall be created . . .
within the framework of this Constitution and the national sovereignty as well as territorial
integrity of the Republic of the Philippines". TEaADS
The present case involves the creation of a local government unit that necessarily involves
also the creation of a legislative district. The Court will not pass upon the constitutionality of the
creation of municipalities and barangays that does not comply with the criteria established in Section
461 of R.A. 7160, as mandated in Section 10, Article X of the Constitution, because the creation of
such municipalities and barangays does not involve the creation of legislative districts. We leave the
resolution of this issue to an appropriate case.
In summary, we rule that Section 19, Article VI of R.A. 9054, insofar as it grants to the
ARMM Regional Assembly the power to create provinces and cities, is void for being contrary to
Section 5 of Article VI and Section 20 of Article X of the Constitution, as well as Section 3 of the
Ordinance appended to the Constitution. Only Congress can create provinces and cities because the
creation of provinces and cities necessarily includes the creation of legislative districts, a power only
Congress can exercise under Section 5, Article VI of the Constitution and Section 3 of the Ordinance
appended to the Constitution. The ARMM Regional Assembly cannot create a province without a
legislative district because the Constitution mandates that every province shall have a legislative
district. Moreover, the ARMM Regional Assembly cannot enact a law creating a national office like the
office of a district representative of Congress because the legislative powers of the ARMM Regional
Assembly operate only within its territorial jurisdiction as provided in Section 20, Article X of the
Constitution. Thus, we rule that MMA Act 201, enacted by the ARMM Regional Assembly and creating
the Province of Shariff Kabunsuan, is void. acCITS
Resolution No. 7902 Complies with the Constitution
Consequently, we hold that COMELEC Resolution No. 7902, preserving the geographic
and legislative district of the First District of Maguindanao with Cotabato City, is valid as it merely
complies with Section 5 of Article VI and Section 20 of Article X of the Constitution, as well as Section
1 of the Ordinance appended to theConstitution.
WHEREFORE, we declare Section 19, Article VI of Republic Act No.
9054 UNCONSTITUTIONAL insofar as it grants to the Regional Assembly of the Autonomous Region
in Muslim Mindanao the power to create provinces and cities. Thus, we declare VOID Muslim
Mindanao Autonomy Act No. 201 creating the Province of Shariff Kabunsuan. Consequently, we rule
that COMELEC Resolution No. 7902 is VALID. ESTAIH
Let a copy of this ruling be served on the President of the Senate and the Speaker of the
House of Representatives.
SO ORDERED. TCEaDI
Puno, C.J., Quisumbing, Austria-Martinez, Corona, Carpio-Morales, Nachura and Reyes,
JJ., concur.
Ynares-Santiago, Leonardo-de Castro and Brion, JJ., join the separate opinion of Justice
Tinga.
Azcuna and Chico-Nazario, JJ., join the dissent of Justice Tinga.
Tinga, J., please see dissenting concurring opinion.
Velasco, Jr., J., took no part — close relationship to a party.
Separate Opinions
TINGA, J., dissenting and concurring:
I agree that the petitions should be denied, but on a wholly different basis from that offered
by the majority. I cannot accede to the majority's conclusion, burnished by reasoning most strained,
that the Regional Assembly of the Autonomous Region of Muslim Mindanao (Regional Assembly)
should be deprived of the power delegated to it by Congress to create provinces. With this ruling, the
Court has dealt another severe blow to the cause of local autonomy. CTaSEI
Our Constitution, in reflection of the sovereign wisdom of the people, has prescribed local
government rule as a tool for national development and welfare. The majority is unfortunately
unmindful of these considerations. The Regional Assembly and the government of the Autonomous
Region of Muslim Mindanao exercised constituent functions in establishing the province of Shariff
Kabunsuan and providing for its local government. The majority did not bother to hear their side in
these petitions, which after all, never put in issue the constitutionality of the creation of the province.
The people of Shariff Kabunsuan, by sovereign desire and constitutional design, ratified through a
plebiscite the province named in honor of the revered figure who introduced Islam to Central
Mindanao. The majority has annihilated the province with nary a word of comfort or concern for its
citizens. Sadly, there will be no shelter for the Court from the impact of this decision, which unduly
stretches the Constitution to deny the will of the duly elected members of the Regional Assembly, that
of the constituents they represent, and most of all, that of the people of Shariff Kabunsuan.
I.
We are dealing with two consolidated petitions which essentially raise the same arguments,
but were brought forth by two different parties laboring under different circumstances. The petitioner in
G.R. No. 177597, Bai Sandra S.A. Sema, a congressional candidate in the 2007 legislative elections
who posits that the newly-created province of Shariff Kabunsuan is entitled to its own exclusive
legislative district. The petitioner in G.R. No. 178628, Perfecto F. Marquez, suing in his capacity as a
taxpayer and a resident of Cotabato City, 1 argues that with the creation of Shariff Kabunsuan, his
home city cannot be conjoined with Shariff Kabunsuan to create just one legislative district for both
territories. IcDESA
As narrated by the majority, 2 four (4) days prior to the 14 May 2007 elections, respondent
Commission on Elections (COMELEC) promulgated Resolution No. 7902, whereby it resolved to
maintain the composition of what had been the First District of Maguindanao, composed of Cotabato
City, a chartered city, and several other municipalities, even though these municipalities formerly
belonging to Maguindanao have since been constituted as part of the province of Shariff Kabunsuan,
which was created by the Regional Assembly by virtue of Muslim Mindanao Autonomy Act No. 201 in
August of 2006.
Both petitioners challenge the notion of fusing Cotabato City, which is not a part of ARMM,
with the ARMM municipalities which now constitute the new province of Shariff Kabunsuan, into one
legislative district. To resolve that question on the merits, it is inevitable that the Court examine the
validity of the creation of Shariff Kabunsuan in the first place, and the majority has fully adopted that
approach. However, there are significant impediments that weigh down both petitioners, and supply
the cogent reason for the more prudent approach which is to dismiss the petitions outright. DHcSIT
It is clear that both petitioners rely on constitutional issues in support of their petitions as
they posit that under the Constitution Shariff Kabunsuan is entitled to its own separate legislative
district. It is cardinal that the Court's power of judicial review may be exercised in constitutional cases
only if all the following requisites are complied with, namely: (1) the existence of an actual and
appropriate case or controversy; (2) a personal and substantial interest of the party raising the
constitutional question; (3) the exercise of judicial review is pleaded at the earliest opportunity; and (4)
the constitutional question is the lis mota of the case. 3
With respect to Sema, it is plainly evident, as argued by private respondent Rep. Didagen P.
Dilangalen, that she is estopped from bringing forth the present petition. On 29 March 2007, she filed
her Certificate of Candidacy before the COMELEC, declaring her candidacy a Member of the House
of Representatives representing "the Province of Shariff Kabunsuan w/ Cotabato City." 4 She
recognized under oath that she was seeking election for a legislative district that encompassed both
Shariff Kabunsuan and Cotabato City, and she should be consequently barred from disavowing the
very district which she undertook to serve if elected. Sema appears to have campaigned for election in
this conjoined district, and was accordingly defeated by Dilangalen, her votes from both Shariff
Kabunsuan and Cotabato City included in the tally. SIHCDA
It would indeed be difficult to assess injury for purposes of locus standi on the part of Sema
by reason of the assailed COMELEC Resolution, which after all, reaffirms the very legislative district
whose seat in Congress she had sought to be elected to. Her standing to raise the present petition is
materially affected by her express consent and active campaign for election from the legislative district
which she now seeks to invalidate. A party challenging the constitutionality of a law, act or statute
must show "not only that the law is invalid, but also that he or she has sustained or is in immediate, or
imminent danger of sustaining some direct injury as a result of its enforcement", that party has been or
is about to be, denied some right or privilege to which he or she is lawfully entitled. 5 Sema's prior
avowal that she was running for the Shariff Kabunsuan with Cotabato City legislative district, and her
campaign for election to that district, belie the existence of injury on her part caused by the COMELEC
resolution that affirmed that very legislative district.
On the part of Marquez, he first raised his present claims through the petition in G.R. No.
179608, which was filed with this Court in July 2007, or more than two months after the May 2007
elections. As a result, could no longer ask that the holding of the said elections in the conjoined district
be restrained, and instead seeks that new or special elections be conducted. AEDcIH
As earlier noted, among the requisites for the Court to be able to exercise judicial review in
constitutional cases is that the exercise of judicial review is pleaded at the earliest possible
opportunity. 6 Clearly, his petition was not timely filed at the earliest possible opportunity, which would
have been at a point prior to the May 2007 elections. Worse, he filed his petition after the voters in the
affected districts had already elected a candidate of their choosing, a sovereign act which he seeks to
annul. Considering the grave implications of the step he seeks, as well as the fact that such recourse
usually smacks of opportunism and bad faith, it is but proper for the Court to decline review unless all
the established requisites for judicial review for constitutional cases have indeed been met. Marquez
does not meet this Court's exacting standards.
Moreover, Marquez does not have a valid cause of action before this Court. His prayer is to
compel the COMELEC to provide for new congressional elections for Cotabato City. The relief sought
does not lie simply because Rep. Dilangalen, by virtue of his electoral victory, lawfully represents the
City in addition to the Province of Shariff Kabunsuan. From another perspective, the COMELEC does
not have the requisite power to call elections, as the same is part of the plenary legislative power. Only
Congress, which was not impleaded as a party to Marquez's petition, has the power to set
congressional elections only for Cotabato City, if ever. Even assuming that Congress was impleaded,
it would be improper for this Court to compel Congress by judicial fiat to pass a law or resolution for the
holding of such elections. AHaETS
In sum, Marquez's petition should be dismissed outright for having been filed out of time, for
lack of cause of action, and for not impleading a real party-in-interest.
II.
One might argue that it is imperative for the Court to resolve the substantive issues, since
the situation may emerge again. However, the exception in exercising judicial review if the case is
capable of repetition yet evading review applies only if the case is "moot and academic", 7 and not
when the petitioners lack the requisite standing, have no cause of action, and have failed to join a
proper party, which is the case here. In addition, it is entirely possible that between now and the next
elections, either Congress or the Regional Assembly would pass new legislation concerning the
composition or status of Shariff Kabunsuan, thereby changing the legal complexion and factual milieu
of the situation. If that occurs, the questions that will be facing the Court then should a challenge be
mounted may very well be different from those currently befacing us. HTCAED
However, it is apparent that the ponente wishes to settle these cases on the merits. In doing
so, he frames two issues — whether Congress can delegate to the Regional Assembly the power to
create provinces; and whether the Regional Assembly has the power to create legislative districts.
However, with due respect, the majority's discussion makes quite an easy leap when it abruptly fuses
these two issues. Worse, the majority fails to take into account certain fundamental constitutional
principles which have immense bearing in these cases. The resulting analysis is incomplete and
uninformed of the full constitutional milieu under which these petitions should be resolved.
My own framework firstly considers two important principles which underlie the issues
presented before us — the rule on delegation of powers, and the constitutionally-ordained paradigms
of local government and local autonomy. Without the influence of these principles, any resulting
analysis of the two issues cast by the majority will be atomistic in nature. HcSDIE
III.
The laws we are presently impelled to interpret involve multiple instances of Congress
delegating power to the Regional Assembly. Explicity, Rep. Act No. 9054delegates to the Regional
Assembly the power to create provinces and other local government units, though subject to certain
specified limitations. The majority likewise asserts that through that mechanism, Congress has also
delegated to the Regional Assembly the power to create legislative districts.
The fundamental principles on delegation of powers bear review.
 The Constitution expressly vests legislative power in the Congress of the Philippines,
consisting of a Senate and a House of Representatives. 8 Traditionally, the delegation of Congress of
its legislative powers had been frowned upon. "A logical corollary to the doctrine of separation of
powers is the principle of non-delegation of powers, as expressed in the Latin maxim potestas
delegata non delegare potest (what has been delegated cannot be delegated). This is based on the
ethical principle that such delegated power constitutes not only a right but a duty to be performed by
the delegate through the instrumentality of his own judgment and not through the intervening mind of
another." 9
However, the strict application of the non-delegation doctrine has, in recent times, been
relaxed, if not minimized altogether, particularly in the context of regulatory jurisdiction of
administrative agencies. In every industrialized nation, administrative agencies, which are generally
part of the executive branch, have been granted considerable lawmaking power. 10 "Given the
volume and variety of interactions in today's society, it is doubtful if the legislature can promulgate
laws that will deal adequately with and respond promptly to the minutiae of everyday life. Hence, the
need to delegate to administrative bodies — the principal agencies tasked to execute laws in their
specialized fields — the authority to promulgate rules and regulations to implement a given statute
and effectuate its policies." 11
In the context of delegation of legislative powers to local governments, a noted authority on
the subject has this to say:
The state legislative power — that is, the exercise of the policy-making
judgment and discretion on state matters that state constitutions vest and recognize
in the legislature — cannot be delegated to some other person or body but must rest
with the legislature itself. Thus, the legislature cannot delegate to a commission the
power to determine the form of government, powers and functions of proposed
municipalities since these matters require legislative judgment. But the details of
organization of its own government can be left to a municipality, limited only
by general state law; and such basic state powers as the police power, taxing
power, and power of eminent domain can be, and almost always are,
delegated to local governments for their use for local purposes. The rule
against delegation of state legislative authority is no barrier to the delegation
of powers of local self government to local units. . . . 12
Notwithstanding the exceptions that have been carved to the rule of non-delegation, it bears
notice that while our Constitution broadly endows legislative powers to Congress it also specifically
conditions the emergence of certain rights, duties and obligations upon the enactment of a law
oriented towards such constitutional predicate. These include the prohibition of political dynasties as
may be defined by law, 13 the reasonable conditions prescribed by law relating to full public
disclosure of all the State's transactions involving public interest; 14 the manner by which Philippine
citizenship may be lost or reacquired; 15 the date of regular elections for members of
Congress; 16 the manner of conduct of special elections to fill in congressional vacancies; 17 the
authorization of the President to exercise emergency powers; 18 the system for initiative and
referendum; 19 the salaries of the President and Vice-President; 20 the creation and allocation of
jurisdiction of lower courts; 21 and on many other matters of grave import. cTCADI
May these specified functions be delegated by Congress to another body? These specific
functions are non-delegable, for they are textually committed by theConstitution to Congress.
Perhaps it is possible to segregate these particular functions to those which would, even absent
constitutional definition, anyway fall within the plenary legislative power, and those which are not
plenary in nature but were especially designated to Congress by the Constitution. Still, in either case,
only Congress, and no other body, can carry out that function. As to those powers which would
normally fall within the plenary legislative power, the Constitution has decided to doubly emphasize
that it is the Congress which is so empowered to perform such tasks. With respect to the non-plenary
functions assigned to Congress, it is clear that the assignment implies the delegation by the
Constitution to Congress of specific, wholly original functions.
There shall be further discussion on this point in relation to the questions currently
presented. Before we get there, I wish to emphasize a second constitutional principle, local
governance and autonomy, that should likewise bear on our deliberations. SDTaHc
IV.
The 1987 Constitution ushered in a new era in local government rule for all citizens, and
local autonomy rule for Muslim Mindanao and the Cordillera region. This new paradigm is crystallized
under Article X of the Constitution.
Section 2, Article X guarantees that the territorial and political subdivisions in the
Philippines shall enjoy local autonomy. The guarantee of local autonomy is actualized through a local
government code that delineates the structure and powers of local governments, and through
constitutional measures that entitle local government units to generate their own revenue stream and
assure the same to their fair share in the national internal revenue. 22 Local government rule, in
constitutional contemplation, is a live being that exists to counterbalance the rule of the national
government, and is not a mere palliative established in theConstitution to soothe the people with the
illusion of having a more direct say in their governance. EcIaTA
By constitutional design, local government rule for the people of Muslim Mindanao and the
Cordilleras is even more enhanced, as they are assured of their own autonomous regions. Section 15,
Article X of the Constitution mandated that "[t]he shall be created autonomous regions in Muslim
Mindanao and in the Cordilleras consisting of provinces, cities, municipalities, and geographical areas
sharing common and distinctive historical and cultural heritage, economic and social structures, and
other relevant characteristics . . ." Following the Constitution, Congress in 1989 passed Republic Act
No. 6734, "An Act Providing for An Organic Act for the Autonomous Region in Muslim Mindanao",
leading to the creation of the ARMM. In 2001, Congress further strengthened the Organic Act with the
passage of Rep. Act No. 9054, which among others, empowered the Assembly to create provinces.
The Organic Acts possess a special status within Philippine laws. While they are classified as statutes,
the Organic Acts are more than ordinary statutes because they enjoy affirmation by a plebiscite, and
thus could not be amended by ordinary statutes without any plebiscite. 23
In Disomangcop v. Datumanong, 24 the Court explained at length the vital constitutional
purposes of local autonomy:
. . . According to Commissioner Jose Nolledo, Chairman of the
Committee which drafted the provisions, it "is an indictment against the status quo
of a unitary system that, to my mind, has ineluctably tied the hands of progress in
our country . . . our varying regional characteristics are factors to capitalize on to
attain national strength through decentralization." DCcHAa
The idea behind the Constitutional provisions for autonomous regions is
to allow the separate development of peoples with distinctive cultures and traditions.
These cultures, as a matter of right, must be allowed to flourish.
xxx xxx xxx
Several commissioners echoed the pervasive sentiment in the plenary
sessions in their own inimitable way. Thus, Commissioner Bias Ople referred to the
recognition that the Muslim Mindanao and the Cordilleras "do not belong to the
dominant national community" as the justification for conferring on them a "measure
 of legal self-sufficiency, meaning self-government, so that they will flourish
politically, economically and culturally", with the hope that after achieving parity with
the rest of the country they would "give up their own autonomous region in favor of
joining the national mainstream". For his part, the Muslim delegate, Commissioner
Ahmad Alonto, spoke of the diversity of cultures as the framework for
nation-building. Finally, excerpts of the poignant plea of Commissioner Ponciano
Bennagen deserve to be quoted verbatim:
. . . They see regional autonomy as the answer to their
centuries of struggle against oppression and exploitation. For so long,
their names and identities have been debased. Their ancestral lands
have been ransacked for their treasures, for their wealth. Their cultures
have been defiled, their very lives threatened, and worse, extinguished,
all in the name of national development; all in the name of public interest;
all in the name of common good; all in the name of the right to property; all
in the name of Regalian Doctrine; all in the name of national security.
These phrases have meant nothing to our indigenous communities,
except for the violation of their human rights. AacSTE
xxx xxx xxx
Honorable Commissioners, we wish to impress upon you the
gravity of the decision to be made by every single one of us in this
Commission. We have the overwhelming support of the Bangsa Moro
and the Cordillera Constitution. By this we mean meaningful and
authentic regional autonomy. We propose that we have a separate Article
on the autonomous regions for the Bangsa Moro and Cordillera people
clearly spelled out in this Constitution, instead of prolonging the agony of
their vigil and their struggle. This, too is a plea for national peace. Let us
not pass the buck to the Congress to decide on this. Let us not wash our
hands of our responsibility to attain national unity and peace and to settle
this problem and rectify past injustices, once and for all.
The need for regional autonomy is more pressing in the case of the
Filipino Muslims and the Cordillera people who have been fighting for it. Their
political struggle highlights their unique cultures and the unresponsiveness of the
unitary system to their aspirations. The Moros' struggle for self-determination dates
as far back as the Spanish conquest in the Philippines. Even at present, the
struggle goes on. ASHECD
Perforce, regional autonomy is also a means towards solving existing
serious peace and order problems and secessionist movements. Parenthetically,
autonomy, decentralization and regionalization, in international law, have become
politically acceptable answers to intractable problems of nationalism, separatism,
ethnic conflict and threat of secession. 25
Petitioner Sema points out that among the terms in the Final Peace Agreement between the
Philippine Government and the Moro National Liberation Front was that amendments be introduced to
the original Organic Act, including one which authorized the Assembly to "create, divide, merge,
abolish or substantially alter boundaries of local government units in the area of autonomy in
accordance with the criteria laid down by law subject to approval by a majority of the votes cast in a
plebiscite called for the purpose in the political units affected." 26 Indeed, it could hardly be argued
that the challenged power of the Assembly was animated by nakedly selfish political purposes. It was,
in fact, among the terms negotiated with care by the Philippine Government with the leading armed
insurgency group in Muslim Mindanao towards the higher purpose of providing a permanent peace
agreement in the strife-torn region. It does come with a measure of surprise and disappointment that
the Solicitor General has reached a position that rejects the Final Peace Agreement negotiated by the
Government and the MNLF. CDHSac
Disomangcop further crystallizes the interplay between regional autonomy and national
sovereignty, to the extent that the former is accommodated under the latter.
Regional autonomy is the degree of self-determination exercised by the
local government unit vis-Ã -vis the central government. TCHcAE
In international law, the right to self-determination need not be
understood as a right to political separation, but rather as a complex net of
legal-political relations between a certain people and the state authorities. It
ensures the right of peoples to the necessary level of autonomy that would
guarantee the support of their own cultural identity, the establishment of priorities by
the community's internal decision-making processes and the management of
collective matters by themselves.
If self-determination is viewed as an end in itself reflecting a preference
for homogeneous, independent nation-states, it is incapable of universal application
without massive disruption. However, if self-determination is viewed as a means to
an end — that end being a democratic, participatory political and economic system
in which the rights of individuals and the identity of minority communities are
protected — its continuing validity is more easily perceived. IaAHCE
Regional autonomy refers to the granting of basic internal government
powers to the people of a particular area or region with least control and supervision
from the central government.
The objective of the autonomy system is to permit determined groups,
with a common tradition and shared social-cultural characteristics, to develop freely
their ways of life and heritage, exercise their rights, and be in charge of their own
business. This is achieved through the establishment of a special governance
regime for certain member communities who choose their own authorities from
within the community and exercise the jurisdictional authority legally accorded to
them to decide internal community affairs. ATcaID
In the Philippine setting, regional autonomy implies the cultivation of
more positive means for national integration. It would remove the wariness among
the Muslims, increase their trust in the government and pave the way for the
unhampered implementation of the development programs in the region. Again,
even a glimpse of the deliberations of the Constitutional Commission could lend a
sense of the urgency and the inexorable appeal of true decentralization:
MR. OPLE. . . . We are writing a Constitution, of course, for
generations to come, not only for the present but for our posterity. There
is no harm in recognizing certain vital pragmatic needs for national peace
and solidarity, and the writing of this Constitution just happens at a time
when it is possible for this Commission to help the cause of peace and
reconciliation in Mindanao and the Cordilleras, by taking advantage of a
heaven-sent opportunity. . . .
xxx xxx xxx
 MR. ABUBAKAR. . . . So in order to foreclose and convince the
rest of the Philippines that Mindanao autonomy will be granted to them as
soon as possible, more or less, to dissuade these armed men from going
outside while Mindanao will be under the control of the national
government, let us establish an autonomous Mindanao within our effort
and capacity to do so within the shortest possible time. This will be an
answer to the Misuari clamor, not only for autonomy but for
independence. cDCHaS
xxx xxx xxx
MR. OPLE. . . . The reason for this abbreviation of the period
for the consideration of the Congress of the organic acts and their
passage is that we live in abnormal times. In the case of Muslim
Mindanao and the Cordilleras, we know that we deal with questions of
war and peace. These are momentous issues in which the territorial
integrity and the solidarity of this country are being put at stake, in a
manner of speaking.
We are writing a peace Constitution. We hope that the Article
on Social Justice can contribute to a climate of peace so that any civil
strife in the countryside can be more quickly and more justly resolved. We
are providing for autonomous regions so that we give constitutional
permanence to the just demands and grievances of our own fellow
countrymen in the Cordilleras and in Mindanao. One hundred thousand
lives were lost in that struggle in Mindanao, and to this day, the
Cordilleras is being shaken by an armed struggle as well as a peaceful
and militant struggle. TAScID
xxx xxx xxx
Rather than give opportunity to foreign bodies, no matter how
sympathetic to the Philippines, to contribute to the settlement of this issue,
I think the Constitutional Commission ought not to forego the opportunity
to put the stamp of this Commission through definitive action on the
settlement of the problems that have nagged us and our forefathers for so
long. 27
A necessary prerequisite of autonomy is decentralization, which typically involves
delegated power wherein a larger government chooses to delegate certain authority to more local
governments. 28 Decentralization of power involves an abdication of political power in the favor of
local government units declared to be autonomous, which are free to chart their own destiny and
shape their future with minimum intervention from central authorities. 29 What the
Constitutioncontemplated with respect to the ARMM was political autonomy. As explained by Justice
Cortes for the Court:
It must be clarified that the constitutional guarantee of local autonomy in
the Constitution [Art. X, sec. 2] refers to the administrative autonomy of local
government units or, cast in more technical language, the decentralization of
government authority [Villegas v. Subido, G.R. No. L-31004, January 8, 1971, 37
SCRA 1]. Local autonomy is not unique to the 1987 Constitution, it being
guaranteed also under the 1973 Constitution [Art. II, sec. 10]. And while there was
no express guarantee under the 1935 Constitution, the Congress enacted the Local
Autonomy Act (R.A. No. 2264) and the Decentralization Act (R.A. No. 5185), which
ushered the irreversible march towards further enlargement of local autonomy in
the country [Villegas v. Subido, supra.] cADaIH
On the other hand, the creation of autonomous regions in Muslim
Mindanao and the Cordilleras, which is peculiar to the 1987 Constitution,
contemplates the grant of political autonomy and not just administrative
autonomy to these regions. Thus, the provision in the Constitution for an
autonomous regional government with a basic structure consisting of an executive
department and a legislative assembly and special courts with personal, family and
property law jurisdiction in each of the autonomous regions [Art. X, sec. 18]. 30
Disomangcop further elaborates on the import of political autonomy as it relates to the
ARMM:
[B]y regional autonomy, the framers intended it to mean "meaningful and
authentic regional autonomy". As articulated by a Muslim author, substantial and
meaningful autonomy is "the kind of local self-government which allows the people
of the region or area the power to determine what is best for their growth and
development without undue interference or dictation from the central government".
To this end, Section 16, Article X limits the power of the President over
autonomous regions. In essence, the provision also curtails the power of Congress
over autonomous regions. Consequently, Congress will have to re-examine
national laws and make sure that they reflect the Constitution's adherence to local
autonomy. And in case of conflicts, the underlying spirit which should guide its
resolution is the Constitution's desire for genuine local autonomy. CcTIAH
The diminution of Congress' powers over autonomous regions was
confirmed in Ganzon v. Court of Appeals, [ 31 ] wherein this Court held that "the
omission (of "as may be provided by law") signifies nothing more than to underscore
local governments' autonomy from Congress and to break Congress' 'control' over
local government affairs." 32
Unfortunately, the majority gives short shrift to the considerations of local autonomy, even
as such paradigm partakes of a constitutional mandate. If anything, these provisions should dissuade
against a reflexive dismissal of the provisions of the Organic Acts. It should be emphasized that local
autonomy cannot be in denigration of the Constitution. It is repeatedly emphasized within Article X
that the grant of local autonomy and the subsequent exercise of powers by the autonomous
government must remain within the confines of the Constitution. At the same time, if there is no
constitutional bar against the exercise of the powers of government by the autonomous government in
Muslim Mindanao, particularly by the Regional Assembly, then there is no basis to thwart the
constitutional design by denying such powers to that body. aCITEH
Having laid down the essential constitutional predicates, I shall proceed to dwell on the core
issues raised. May Congress delegate to the Regional Assembly the power to create provinces?
Assuming that such delegation is not barred by the Constitution, may the exercise of such power by
the Regional Assembly give rise to separate legislative districts for such provinces thus created?
V.
There should be little debate on the origins of the power to create provinces, which had
existed as a political unit in the Philippines since the Spanish colonial period, and which all
our Constitutions have recognized as a basic level of local governments. Ever since the emergence of
our tripartite system of democratic government, the power to create provinces have always been
legislative in character. They are created by the people through their representatives in Congress,
subject to direct affirmation by the very people who stand to become the constituents of the new
putative province. DSHTaC
May such power be delegated by Congress to a local legislative body such as the
Regional Assembly? Certainly, nothing in the Constitution bars Congress from doing so. In
fact, considering the constitutional mandate of local autonomy for Muslim Mindanao, it can be
said that such delegation is in furtherance of the constitutional design.
The only constitutional provision that concerns with the creation of provinces is Section 10,
Article X, which reads:
Section 10. No province, city, municipality or barangay may be created,
divided, merged, abolished, or its boundary substantially altered, except in
accordance with the criteria established in the local government code and subject
to approval by a majority of the votes cast in a plebiscite in the political units directly
affected. ISAcHD
Nothing in this provision specifically limits the power to create provinces, cities,
municipalities or barangays to Congress alone. The provision does embody a significant limitation —
that the creation of these political subdivisions must be in accordance with the criteria established in
the local government code, a law which is enacted by Congress. It would thus be proper to say that
the Constitution limits the ability to set forth the standards for the creation of a province exclusively to
Congress. But to say that the Constitution confines to Congress alone the power to establish the
criteria for creating provinces is vastly different from saying that theConstitution confines to Congress
alone the power to create provinces. There is nothing in the Constitution that supports the latter
proposition.
Section 10, Article X does not specifically designate Congress as the body with the power to
create provinces. As earlier stated, the power to create these political subdivisions is part of the
plenary legislative power, hence such power can be exercised by Congress even without need of
specific constitutional assignation. At the same time, the absence of constitutional language
committing Congress with the function of creating political subdivisions ultimately denotes that such
legislative function may be delegated by Congress. CaDATc
In fact, the majority actually concedes that Congress, under its plenary legislative powers,
"can delegate to local legislative bodies the power to create local government units, subject to
reasonable standards and provided no conflict arises with any provision of the Constitution." 33 As is
pointed out, such delegation is operationalized by the LGC itself, which confers to provincial boards
and city and municipal councils, the general power to create barangays within their respective
jurisdictions. The Constitution does not confine the exercise of such powers only to the national
legislature, and indeed if that were the case, the power to create barangays as granted by the LGC to
local legislative bodies would be unconstitutional.
Traditionally, it has been the national legislature which has exercised the power to create
provinces. However, the 1987 Constitution ushered in a new era in devolved local government rule,
and particularly, a regime of local autonomy for Muslim Mindanao and the Cordilleras. We recognized
in Disomangcop v. Datumanong, thus:
Autonomy, as a national policy, recognizes the wholeness of the
Philippine society in its ethnolinguistic, cultural, and even religious diversities. It
strives to free Philippine society of the strain and wastage caused by the
assimilationist approach. Policies emanating from the legislature are invariably
assimilationist in character despite channels being open for minority representation.
As a result, democracy becomes an irony to the minority group. 34
It bears reemphasizing that the Constitution also actualizes a preference for local
government rule, and thusly provides:
The Congress shall enact a local government code which shall provide
for a more responsive and accountable local government structure instituted
through a system of decentralization with effective mechanisms of recall,
initiative, and referendum, allocate among the different local government units
their powers, responsibilities, and resources, and provide for the
qualifications, election, appointment and removal, term, salaries, powers and
functions and duties of local officials, and all other matters relating to the
organization and operation of the local units. 35
Attuned with enhanced local government rule, Congress had, through Rep. Act No.
9054, taken the bold step of delegating to a local legislative assembly the power to create
provinces, albeit prudently withholding any ability to create legislative districts as well. Section 19
of Rep. Act No. 9054 reads:
Section 19. Creation, Division or Abolition of Provinces, Cities,
Municipalities or Barangay. — The Regional Assembly may create, divide, merge,
abolish, or substantially alter boundaries of provinces, cities, municipalities, or
barangays in accordance with the criteria laid down by the Republic Act No. 7160,
the Local Government Code of 1991, subject to the approval by the majority of the
votes cast in the plebiscite in the political units directly affected. The Regional
Assembly may prescribe standards lower than those mandated by Republic Act No.
7160, the Local Government Code of 1991, in the creation, division, merger,
abolition, or alteration of the boundaries of provinces, cities, municipalities, or
barangay. Provinces, cities, municipalities, or barangays created, divided, merged,
or whose boundaries are altered without observing the standards prescribed
by Republic Act No. 7160, the Local Government Code of 1991, shall not be
entitled to any share of the taxes that are allotted to the local governments units
under the provisions of the code. TCADEc
The financial requirements of the provinces, cities and municipalities, or
barangays so created, divided, merged shall be provided by the Regional Assembly
out of the general funds of the Regional Government.
The holding of a plebiscite to determine the will of the majority of the
voters of the areas affected by the creation, division, merger, or whose boundaries
are being altered as required by Republic Act No. 7160, the Local Government
Code of 1991, shall, however, be observed. aDIHCT
Because this empowerment scheme is in line with a policy preferred by the Constitution, it
becomes utterly necessary to pinpoint a specific constitutional prohibition that bars Congress from
authorizing the Regional Assembly to create provinces. No such constitutional limitation exists,
and it is not the province, duty or sensible recourse of this Court to nullify an act of
Government in furtherance of a constitutional mandate and directly ratified by the affected
people if nothing in the Constitution proscribes such act.
The constitutionality of the delegated power of the Regional Assembly to create provinces
is further affirmed by the provisions in the Constitution concerning the mandatory creation of
autonomous regions in Muslim Mindanao, as found in Sections 15 to 21, Article X. The organic
act enacted by Congress for the autonomous region is to define the basic structure of
government. 36 Section 20 specifically allows the organic act of autonomous regions to provide for
legislative powers over, among others, administrative organization; creation of sources of revenues;
economic, social and tourism development; and such other matters as may be authorized by law for
the promotion of the general welfare of the people of the region. The creation of provinces within the
autonomous region precisely assists these constitutional aims under Section 20, enhancing as it does
the basic administration of government, the delivery of government services, and the promotion of the
local economy. aSHAIC
In addition, Section 17, Article X states that "[a]ll powers, functions, and responsibilities not
granted by this Constitution or by law to the autonomous regions shall be vested in the National
Government". The original Organic Act for Muslim Mindanao did not grant to the regional government
the power to create provinces, thus at that point, such power was properly exercised by the National
Government. But the subsequent passage of Rep. Act No. 9054 granted to the Regional Assembly
the power, function and responsibility to create provinces and other local government units which had
been exercised by the National Government.
The majority does not point to any specific constitutional prohibition barring Congress from
delegating to the Regional Assembly the power to create provinces. It does cite though that Article
460 of the LGC provides that only by an Act of Congress may a province be created, divided, merged,
abolished or its boundary substantially altered. However, Republic Act No. 9054, which was passed
ten (10) years after the LGC, unequivocally granted to the ARMM Regional Assembly the power to
create provinces, cities, municipalities and barangays within the ARMM. aSIDCT
Any argument that the LGC confines to Congress the creation of provinces is muted by the
fact that ten years after the LGC was enacted by Congress, the same legislative body conferred on
the Assembly that same power within its territorial jurisdiction, thus amending the LGC to the extent of
accommodating these newly-granted powers to the Assembly.
There actually is an obvious unconstitutional dimension to Section 19, albeit one which is
not in point in this case. The provision states in part "[t]hat Regional Assembly may prescribe
standards lower than those mandated by Republic Act No. 7160, the Local Government Code of
1991, in the creation, division, merger, abolition, or alteration of the boundaries of provinces, cities,
municipalities, or barangays." That proviso is squarely inconsistent with Section 10, Article X, which
accords to the LGC the sole criteria for the creation, division, merger, abolition or alteration of
boundaries of local government units. Said proviso thus cannot receive recognition from this
Court. ESITcH
It bears noting that there is no contention presented thus far that the creation of Shariff
Kabunsuan was not in accordance with the criteria established in theLGC, thus this aspect of
unconstitutionality of Rep. Act No. 9054 may not be material to the petitions at bar.
VI.
The majority unfortunately asserts that Congress may not delegate to the Regional
Assembly the power to create provinces, despite the absence of any constitutional bar in that respect.
The reasons offered for such conclusion are actually the same reasons it submits why the Regional
Assembly could not create legislative districts, as if the power to create provinces and the power to
create legislative districts were one and the same. In contrast, I propose to pinpoint a specific
constitutional provision that prohibits the Regional Assembly from creating, directly or indirectly, any
legislative district without affecting that body's delegated authority to create provinces. CIHTac
Let us review this issue as presented before us. Notably, Republic Act No. 9054 does not
empower the Regional Assembly to create legislative districts, and MMA Act No. 201, which created
Shariff Kabunsuan, specifically disavows the creation of a new district for that province and maintains
the old legislative district shared with Cotabato City. It is the thesis though of the petitioners that
following Felwa v. Salas, 37 the creation of the new province ipso facto established as well an
exclusive legislative district for Shariff Kabunsuan, "by operation of the Constitution."
How exactly does a legislative district come into being? In theory, Congress does not have
any express or plenary legislative power to create legislative districts, except by reapportionment.
Under the Constitution, such reapportionment occurs within three years following the return of the
census, 38 but this Court has likewise recognized that reapportionment can also be made through a
special law, such as in the charter of a new city. 39 Still, even in exercising this limited power through
the constitutionally mandated reapportionment, Congress cannot substitute its own discretion for the
standards set forth in Section 5, Article VI. And should general reapportionment made by Congress
violate the parameters set forth by the Constitution, such act may be invalidated by the Court, as it did
in Macias v. COMELEC. 40
There is another constitutional provision which is of critical importance in considering
limitations in the creation of legislative districts. Section 5 (1), Article VI states that "[t]he House of
Representatives shall be composed of not more than two hundred fifty members, unless
otherwise fixed by law." The provision textually commits that only through a law may the numerical
composition of Congress may be increased or reduced. SAHIDc
The Court has previously recognized that such law increasing the membership of the
House of Representatives need not be one specifically devoted for that purpose alone, but it may be
one that creates a province or charters a city with a population of more than 250,000. In Tobias v.
Abalos, 41 the Court pronounced that the law converting Mandaluyong into a city could likewise serve
the purpose of increasing the composition of the House of Representatives:
As to the contention that the assailed law violates the present limit on the
number of representatives as set forth in the Constitution, a reading of the
applicable provision, Article VI, Section 5 (1), as aforequoted, shows that the
present limit of 250 members is not absolute. The Constitution clearly provides that
the House of Representatives shall be composed of not more than 250 members,
"unless otherwise provided by law". The inescapable import of the latter clause is
that the present composition of Congress may be increased, if Congress itself so
mandates through a legislative enactment. Therefore, the increase in congressional
representation mandated by R.A. No. 7675 is not unconstitutional. 42
This point was reemphasized by the Court in Mariano v. COMELEC: 43
These issues have been laid to rest in the recent case of Tobias v. Abalos.
In said case, we ruled that reapportionment of legislative districts may be made
through a special law, such as in the charter of a new city. The Constitution clearly
provides that Congress shall be composed of not more than two hundred fifty (250)
members, unless otherwise fixed by law. As thus worded, the Constitution did not
preclude Congress from increasing its membership by passing a law, other than a
general reapportionment law. This is exactly what was done by Congress in
enacting R.A. No. 7854 and providing for an increase in Makati's legislative
district. 44
From these cases, it is evident that a law creating the province of Shariff Kabunsuan may
likewise serve the purpose of increasing the composition of the House of Representatives. In addition,
Congress generally has the power to delegate the power of creating local government units to the
appropriate local legislative assemblies. The critical question now is thus whether Congress may
delegate to local legislative assemblies the power to increase the composition of the House of
Representatives? The answer is no. cDEICH
I have already pointed out that when the Constitution specifically designates a particular
function to Congress, only Congress may exercise such function, as the same is non-delegable. The
power to increase the composition of the House of Representatives is restricted by the Constitution to
a law passed by Congress, which may not delegate such law-making power to the Regional Assembly.
If we were to rule that Congress may delegate the power to increase the composition of the House of
Representatives, there would be no impediment for us to similarly rule that those other specific
functions tasked by the Constitution to Congress may be delegated as well. To repeat, these include
gravely important functions as the enactment of a law defining political dynasties; the enactment of
reasonable conditions relating to full public disclosure of all the State's transactions involving public
interest; the manner by which Philippine citizenship may be lost or reacquired; the date of regular
elections for members of Congress; the provision for the manner of conduct of special elections to fill
in congressional vacancies; the authorization of the President to exercise emergency powers; the
prescription of a system for initiative and referendum; the salaries of the President and Vice-President;
and the creation and allocation of jurisdiction of lower courts.
income; (b) a contiguous territory of at least two thousand (2,000) square kilometers, as certified by
the Lands Management Bureau (excepting when comprised of two (2) or more islands or when
separated by a chartered city or cities which do not contribute to the income of the province), or a
population of not less than 250,000 inhabitants as certified by the National Statistics Office; (c) that the
creation of the province shall not reduce the land area, population, and income of the original unit or
units at the time of said creation to less than the minimum requirements prescribed under the Code.
These standards, which should bear upon the Assembly, would preclude the emergence of dozens,
hundreds or thousands of provinces within the relatively confined spaces of the present Autonomous
Region of Muslim Mindanao.
IX.

Considering that all these matters, including the composition of the House of The concerns raised by the majority on how allowing the Assembly to create provinces
Representatives, are of national interest, it is but constitutionally proper that only a national legislature would affect the composition of the national Congress are valid issues, yet the approach it adopts is to
has the competence to exercise these powers. And the Constitution does textually commit to treat autonomy as invisible and inconsequential, instead of the countervailing constitutional principle
Congress alone the power to increase the membership of the House of Representatives. cSIACD that it actually is. It is an approach that will exacerbate political and regional tensions within Mindanao,
especially since it shuns the terms of the negotiated peace. This decision today, sad to say, is a
Accordingly, the petitioners' position cannot be sustained, as Shariff Kabunsuan cannot decisive step backwards from the previous rulings of this Court that have been supportive of the aims
acquire its own legislative district unless Congress itself accedes to the passage of a law that of regional autonomy. AEIHaS
establishes the same. The contrary position is in denigration of the Constitution, which limits to
Congress alone the non-delegable power to fix or increase the composition of the House of Except for the result, which I join, I respectfully dissent.
Representatives. For that, I concur with the result of the majority. ||| (Sema v. Commission on Elections, G.R. Nos. 177597 & 178628, [July 16, 2008], 580 PHIL 623-689)
Felwa cannot apply to these petitions. Its pronouncement that the creation of a province
automatically leads to the creation of a legislative district "by operation of the Constitution" can only
apply when the province is created by Congress itself, since there is no other constitutional
impediment to the emergence of the legislative district. However, in cases where it is a body other
than Congress which has created, although validly, the legislative district, the Constitution itself bars
the emergence of an accompanying legislative district, as this will result in an increase in the
composition of the House of Representatives which can only be accomplished through a law passed
by Congress. IcaHCS
VII.

Even as Section 19 of Rep. Act No. 9054 constitutionally authorizes the Regional Assembly
to create provinces, there are legal limitations that constrict the discretion of that body to exercise
such power. I had earlier identified as unconstitutional the discretion of the Regional Assembly to
create local government units based on a lower standard than that prescribed under the LGC. Another
clear limitation is that the creation of provinces cannot be authorized without the ratification through a
plebiscite by the people affected by such act, a requirement imposed by the Organic Act itself and by
Section 10, Article X of the Constitution.
The majority itself had raised an alarmist tone that allowing the Assembly to create
provinces would not lead to the unholy spectacle of whimsical provinces intended as personal
fiefdoms and created irrespective of size, shape and sense. In fact, allowing the Regional Assembly to
create provinces will not lead to hundreds or thousands, or even tens or dozens of new provinces. Any
new province will have to meet the same criteria set forth by the LGC for the creation of
provinces. SacTCA
To stress how implausible the scenario of dozens-hundred-thousands of ARMM provinces
actually is, it bears reviewing what exactly is the criteria set forth under the LGC for the creation of
provinces. An Assembly-created province, just as with any other putative province, following Section
461 of the LGC, must possess the following requisites: (a) an average annual income, as certified by
the Department of Finance, of not less than Php20,000,000.00, such income including the income
accruing to the general fund, exclusive of special funds, trust funds, transfers, and non-recurring
 EN BANC
[G.R. No. 13678. November 12, 1918.]
THE UNITED STATES, plaintiff-appellee, vs. PRUDENCIO
SALAVERIA, defendant-appellant.
Jose R. Varela, for appellant.
Solicitor-General Paredes, for appellee.
SYLLABUS
1. CONSTITUTIONAL LAW; "LIBERTY. — The constitutional provision that no person shall
be deprived of liberty without due process of law found not to be violated by an ordinance of Orion,
Bataan. "Liberty" is defined in the opinion.
2. ID.; PUBLIC CORPORATIONS; POLICE POWER. — Not only does the State effectuate
its purposes through the exercise of the police power, but the municipality does also. Like the State,
the police power of a municipal corporation extends to all matters affecting the peace, order, health,
morals, convenience, comfort, and safety of its citizens — the security of social order — the best and
highest interests of the municipality. The best considered decisions have tended to broaden the scope
of action of the municipality in dealing with police offenses. The public welfare is rightly made the basis
of construction.
3. ID.; ID.; ID.; GENERAL WELFARE CLAUSE. — Section 2238 of the Administrative Code
of 1917, known as the general welfare clause, delegates in statutory form the police power to a
municipality. The general welfare clause has two branches. One branch attaches itself to the main
trunk of municipal authority, and relates to such ordinances and regulations as may be necessary to
carry into effect and discharge the powers and duties conferred upon the municipal council by law.
The second branch of the clause is much more independent of the specific functions of the council
which are enumerated by law.
4. ID.; ID.; ID.; ID.; RULE OF CONSTRUCTION. — It is a general rule that ordinances
passed by virtue of the implied power found in the general welfare clause must be reasonable,
consonant with the general powers and purposes of the corporation, and not inconsistent with the
laws or policy of the State.
5. ID.; ID.; ORDINANCES; STATUTORY CONSTRUCTION. — The presumption is all in
favor of the validity of an ordinance.
6. ID.; ID.; PRESIDENT McKINLEY'S INSTRUCTIONS TO THE COMMISSION. — Those
portions of President McKinley's Instructions to the Commission, relating to local self-government, yet
constitute a portion of Philippine Constitutional Law and should be enforced.
7. GAMBLING; CONTROL. — The courts cannot but realize that gambling, in its larger
sense as well as in its restricted sense, is an act beyond the pale of good morals, which, for the
welfare of the Filipino people, should be exterminated. It is highly proper that this pastime should be
subject to the control of restraints imposed by the ordinances of local governments peculiarly afflicted
by the evil.
8. ID.; ID. — For the suppression of the evil of gambling, coordinate and harmonious action
must concur between the three, departments of government.
9. ID.; ID.; PENALTIES. — In all cases arising under the Gambling Law or ordinances,
except for unusual circumstances, a prison sentence should be imposed if permitted by the law or
ordinance. Further, where the defendant has been found guilty and is a man of station, he should be
given the maximum penalty. Example: A justice of the peace, convicted of a violation of a municipal
ordinance, sentenced to the maximum penalty provided by the ordinance, the payment of a fine of
P200.
10. ID.; ID.; PUBLIC CORPORATIONS; ORDINANCES; "PANGUINGUE."
— Panguingue is not a game of chance or of hazard and is not prohibited by Act No. 1757.
11. ID.; ID.; ID.; ID.; ID. — Panguingue is, however, in one sense, a species of gambling
which municipalities can restrain, suppress, or control, by the exercise of the police power.
12. ID.; ID.; ID.; ID.; ID. — Ordinance No. 3 of Orion, Bataan, prohibiting the playing
of panguingue on days not Sundays or legal holidays, and penalizing the violation thereof by
a casero [housekeeper] by a fine of not less than P10 nor more than P200, and
by jugadores [gamblers] by a fine of not less than P5 nor more than P200, held valid.
DECISION
MALCOLM, J p:
The municipal council of Orion, Bataan, enacted, on February 28, 1917, an ordinance which,
among other things, prohibited the playing of panguingue on days not Sundays or legal holidays, and
penalized the violation thereof by a casero [housekeeper] by a fine of not less than P10 nor more than
P200, and by jugadores[gamblers] by a fine of not less than P5 nor more than P200. The justice of the
peace of Orion, when this ordinance went into effect, was Prudencio Salaveria, now the defendant
and appellant. Notwithstanding his official station, on the evening of March 8, 1917, not a Sunday or a
legal holiday, seven persons including the justice of the peace and his wife were surprised by the
police while indulging in a game of panguingue in the house of the justice of the peace. The chief of
police took possession of the cards, the counters (sigayes), a tray, and P2.07 in money, used in the
game.
These are facts fully proven by the evidence and by the admissions of the accused.
Convicted in the justice of the peace court of Orion, and again in the Court of First Instance of Bataan,
Salaveria appeals to this court, making five assignments of error. The three assignments, of a
technical nature, are without merit, and a fourth, relating to the evidence, is not sustained by the proof.
The remaining assignment of error, questioning the validity of the ordinance under which the accused
was convicted, requires serious consideration and final resolution. This ordinance in part reads:
"RESOLUTION NO. 28.
xxx xxx xxx
"Whereas, this Council is vested with certain powers by Sections 2184
and 2185 of the Administrative Code;
 "Whereas, it is the moral duty of this body to safeguard the tranquillity and
stability of the Government and to foster the welfare and prosperity of each and all
of the inhabitants of this municipality; therefore,
"Be it resolved to enact, as it hereby is enacted, the following ordinance:
"ORDINANCE NO. 3.
xxx xxx xxx
"Third. — The games known as 'Panguingue,' 'Manilla,' 'Jung-kiang,'
'Paris-paris,' 'Poker, 'Tute,' 'Burro,' and 'Treinta-y-uno' shall be allowed only on
Sundays and official holidays.
xxx xxx xxx
"The following penalties shall be imposed upon those who play the above
games on days other than Sundays and holidays:
"For the owner of the house: A fine of from Ten to Two hundred pesos, or
subsidiary imprisonment in case of insolvency at the rate of one peso a day.
"For the gamblers: A fine of from Five to Two hundred pesos each or
subsidiary imprisonment in case of insolvency at the rate of one peso a day."
The Philippine Legislature has granted to municipalities legislative powers of a dual
character, one class mandatory and the other discretionary. Of the first class is the provision of the
Administrative Code which makes it the duty of the municipal council, conformably with law, "to
prohibit and penalize . . . gambling." (Sec. 2188 [j], Adm. Code of 1916; Sec. 2242 [j], Adm. Code of
1917.) This is a more restricted power than that found in the original Municipal Code which authorized
a municipal council to "provide against the evils of gambling, gambling houses, and disorderly houses
of whatsoever sort." (Act No. 82, sec. 39 [u].) The present municipal law, since making use of the word
"gambling," must be construed with reference to the Insular Law, Act No. 1757, relating to the same
subject. Act No. 1757 in Section 1 defines "gambling" as "the playing of any game for money or any
representative of value or valuable consideration or thing, the result of which game depends wholly or
chiefly upon chance or hazard, or the use of any mechanical inventions or contrivance to determine by
chance the loser or winner of money or of any representative of value or of any valuable consideration
or thing." In the United States vs. Hilario ([1913], 24 Phil., 392), the Supreme Court went into the
subject of the meaning of "gambling" in this jurisdiction, and found that it includes those games the
result of which depend wholly or chiefly upon chance or hazard, and excludes those games the result
of which depend wholly or chiefly upon skill, with the result that Sections 621 to 625 of the Revised
Ordinances of the city of Manila (734-738 of the Revised Ordinances of 1917) were found to prohibit
only games of chance or hazard.
The ordinance of Orion, Bataan, merely prohibits the playing of panguingue on certain days,
without describing it. Further, although this court has considered the method by which many other
games are played, it has never as yet authoritatively decided whether panguingue was a game of skill
or hazard. Nor was any evidence on this point introduced in the present case. However, a reading of
the decision of the trial court and of official opinions of two Attorneys-General, of which we can take
judicial cognizance, warrants the deduction that panguingue is not a game of chance or hazard and is
not prohibited by Act No. 1757. (See Opinions of the Attorney-General of July 11, 1904; July 25, 1904;
October 10, 1905; and September 7, 1911; also Berriz, Diccionario de la Administracion, p. 35.) If,
therefore, we were to restrict our investigation to those portions of the Administrative Code which
authorize a municipal council to prohibit and penalize gambling, there would exist grave doubt, to say
the least, of the validity of ordinance No. 3 of the municipality of Orion, Bataan.
There remains for consideration a different approach to the question.
While Philippine law gives to gambling a restricted meaning, it is to be noted that, in its
broader signification, gambling relates to play by certain rules at cards, dice, or other contrivance, so
that one shall be the loser and the other the winner. (20 Cyc., 878; Bouvier's Law Dictionary;
People vs. Todd [1889], 51 Hun [N. Y.], 446, 451; 4 N.Y. Supp., 25.) As one example, the Charter of
the town of Ruston, State of Louisiana, authorized it "to restrain, prohibit, and suppress . . . games and
gambling houses and rooms . . ., and to provide for the punishment of the persons engaged in the
same." Under this power the town passed an ordinance prohibiting "all games of chance, lottery,
banking games, raffling, and all other species of gambling," indicating that there were other species of
gambling in addition to games of chance. (See Town of Ruston vs. Perkins [1905], 114 La., 851.) The
common law notion of gambling, which only made it an indictable offense when the play was attended
by such circumstances as would in themselves amount to a riot or a nuisance or to an actual breach of
the peace, has given way to statutes and ordinances designed to restrain, suppress, or control
gambling.
Authority for the State or a municipality to take action to control gambling in this larger
sense can be found in an analysis of what is called the police power.
Any attempt to define the police power with circumstantial precision would savor of
pedantry. The United States Supreme Court tritely describes it as "the most essential of all powers, at
times the most insistent, and always one of least limitable of the powers of government." (District of
Columbia vs. Brooks [1909], 214 U.S., 138.) The police power is based on the maxim "salus populi est
suprema lex" — the welfare of the people is the first law. The United States Supreme Court has said
that it extends "to the protection of the lives, health and property of the citizens, and to
the preservation of good order and the public morals." (Beer Co. vs. Massachusetts [1878], 97 U.S.,
25; Barbier vs. Connolly [1885], 113 U.S., 27.) The Supreme Court of these Islands has said that "the
police power of the state includes not only the public health and safety, but also the public welfare,
protection against impositions, and generally the public's best interest." (U.S. vs. Pompeya [1915], 31
Phil., 245.) Recent judicial decisions incline to give a more extensive scope to the police power than
the older cases. The public welfare is rightfully made the basis of construction.
Not only does the State effectuate its purposes through the exercise of the police power but
the municipality does also. Like the State, the police power of a municipal corporation extends to all
matters affecting the peace, order, health, morals, convenience, comfort, and safety of its citizens —
the security of social order — the best and highest interests of the municipality. (Case vs. Board of
Health of Manila and Heiser [1913], 24 Phil., 250.) The best considered decisions have tended to
broaden the scope of action of the municipality in dealing with police offenses.
Within the general police powers of a municipal corporation is the suppression of gambling.
Ordinances aimed in a reasonable way at the accomplishment of this purpose are undoubtedly valid.
(See U.S. vs. Pacis [1915], 31 Phil., 524; 39 L. R. A., 523, Note; Cooley's Constitutional Limitations,
6th edition, pp. 138, 226, 742; Greenville vs. Kemmis [1900], 58 S.C., 427 [holding that under the
general welfare clause a city may pass an ordinance prohibiting gambling in any private house].)
The Philippine Legislature, as before intimated, delegated to municipalities certain
legislative powers of a discretionary nature. Many of these powers are named specifically. But in
addition, and preceding both the specific powers of a mandatory and discretionary character, is the
general power of a municipal council to enact ordinances and make regulations. It is this grant that the
preamble of the ordinance of Orion assigns as authority for its enactment. Said Section 2184 of the
Administrative Code of 1916 (Sec. 2238, Adm. Code of 1917) reads:
"The municipal council shall enact such ordinances and make such regulations, not
repugnant to law, as may be necessary to carry into effect and discharge the powers and duties
conferred upon it by law and such as shall seem necessary and proper to provide for the health and
safety, promote the prosperity, improve the morals, peace, good order, comfort, and convenience of
the municipality and the inhabitants thereof , and for the protection of property therein."
 This section, known as the general welfare clause, delegates in statutory form the police
power to a municipality. As above stated, this clause has been given wide application by municipal
authorities and has in its relation to the particular circumstances of the case been liberally construed
by the courts. Such, it is well to recall, is the progressive view of Philippine jurisprudence.
The general welfare clause has two branches. One branch attaches itself to the main trunk
of municipal authority, and relates to such ordinances and regulations as may be necessary to carry
into effect and discharge the powers and duties conferred upon the municipal council by law. With this
class we are not here directly concerned. The second branch of the clause is much more independent
of the specific functions of the council which are enumerated by law. It authorizes such ordinances as
shall seem necessary and proper to provide for the health and safety, promote the prosperity, improve
the morals, peace, good order, comfort, and convenience of the municipality and the inhabitants
thereof, and for the protection of property therein."
It is a general rule that ordinances passed by virtue of the implied power found in the
general welfare clause must be reasonable, consonant with the general powers and purposes of the
corporation, and not inconsistent with the laws or policy of the State. The ordinance of the municipality
of Orion does not seem in itself to be pernicious, or unreasonable or discriminatory. Its purposes
evidently are to improve the morals and stimulate the industry of the people. A person is to be
compelled to refrain from private acts injurious both to himself and his neighbors. These objects, to be
attained by limiting the pastime to definite days, do not infringe any law of the general government.
The constitutional provision that no person shall be deprived of liberty without due process
of law is not violated by this ordinance. Liberty of action by the individual is not unduly circumscribed;
that is, it is not unduly circumscribed if we have in mind the correct notion of this "the greatest of all
rights." That gravest of sociological questions — How far, consistantly with freedom, may the liberties
of the individual member of society be subordinated to the will of the Government? — has been
debated for centuries, in vain, if we can not now discount the time worn objection to any and all
interference with private rights in order to effectuate the public purpose. (See Jacobson vs.
Massachusetts [1905], 197 U.S., 11; State vs. Kreutzberg [1902], 58 L.R.A., 748.) Almost countless
are the governmental restrictions on the citizen.
The presumption is all in favor of validity. The inhabitants of a municipality are in
themselves miniature states. The action of the elected representatives of the people cannot be lightly
set aside. The councilors must, in the very nature of things, be familiar with the necessities of their
particular municipality and with all the facts and circumstances which surround the subject, and
necessitate action. The local legislative body, by enacting the ordinance, has in effect given notice
that the regulations are essential to the well being of the people. Who is in a better position to say
whether the playing of panguingue is deleterious to social order and the public interest in a certain
municipality — the municipal council, or the courts? The answer is self-evident. The Judiciary should
not lightly set aside legislative action when there is not a clear invasion of personal or property rights
under the guise of police regulation. (See U.S. vs. Joson [1913], 26 Phil., 1.)
President McKinley's Instructions to the Commission still remain undisturbed by
subsequent Acts of Congress dealing with Philippine affairs and yet constitute a portion of our
constitutional law, as to the inviolable rule that "municipal governments . . . shall be afforded the
opportunity to manage their own affairs to the fullest extent of which they are capable." Again the
same organic law says, "In the distribution of powers among the governments organized by the
Commission, the presumption is always to be in favor of the smaller subdivision, so that all the powers
which can properly be exercised by the municipal government shall be vested in that government . . .."
Let us never forget these principles so highly protective of local self-government.
The judiciary can very well take notice of the fact that municipalities are accustomed to
enacting ordinances aimed at the regulation of gambling. The executive authorities and the
Attorney-General have usually upheld the validity of such ordinances, especially those intended to
restrict the playing of panguingue. (Opinions of the Attorney General, supra; Opinion of the Executive
Secretary, July 6, 1909; Indorsement of the Governor-General, July 21 1904.) This general municipal
practice, indicative of a social cancer to be eradicated, should not be discouraged by strict judicial
construction.
More important still, the courts cannot but realize that gambling, in its larger sense as well
as in its restricted sense, is an act beyond the pale of good morals, which, for the welfare of the
Filipino people, should be exterminated. The suppression of the evil does not interfere with any of the
inherent rights of citizenship. The pernicious practice is rightfully regarded as the offspring of idleness
and the prolific parent of vice and immorality, demoralizing in its association and tendencies,
detrimental to the best interests of society, and encouraging wastefulness, thriftlessness, and a belief
that a livelihood may be earned by other means than honest industry. To be condemned in itself, it has
the further effect of causing poverty, dishonesty, fraud, and deceit. Many a man has neglected his
business and mortgaged his integrity to follow the fickle Goddess of the cards. Many a woman has
wasted her hours and squandered her substance at the gambling board while home and children were
forgotten. It is highly proper that this pastime should be subject to the control of restraints imposed by
the ordinances of local governments peculiarly afflicted by the evil. (See In re Voss [1903], 11 N.D.,
540; Ex parte Tuttle [1891], 91 Cal., 589; Greenwood vs. State [1873], 6 Baxt., 567; 32 Am. Rep., 539;
12 R.C.L., 709-715.)
For the suppression of such an evil, coordinate and harmonious action must concur
between the three departments of Government. A law or ordinance enacted by the legislative body
must exist. Such an ordinance is before us. Vigorous executive enforcement must take place to make
the law or ordinance a reality. Such activity by the police has brought this case to the courts. And
finally the Judiciary, having full respect for the legislative action of the municipal council and for the
prosecution by the executive officials, must, by judicial construction, equally as progressive and
constructive, give effect to the action of the other two powers. Wherefore, although panguingue is not
named in the general law on gambling, and although not entirely a game of chance, since it is a proper
subject for regulation by municipal authorities acting under their delegated police power, whose
laudable intention is to improve the public morals and promote the prosperity of their people, their
action should be upheld by the courts. Ordinance No. 3 of Orion, Bataan, is found to be valid.
The culprit in this case is himself a member of the Judiciary. Instead of enforcing the law, he
has scorned it. His example to the people of Orion has been pernicious in its influence. If gambling is
to be suppressed, not only the weak and ignorant must be punished, but those with full knowledge of
the law and the consequences of violation. We would accordingly suggest to Courts of First Instance
that in all cases arising under the Gambling Law or ordinances, except for unusual circumstances, a
prison sentence should be imposed, if permitted by the law or ordinance. We further suggest that,
where the defendant has been found guilty and is a man of station, he be given the maximum penalty.
Applying the foregoing in this instance, it results that the defendant and appellant must be
found guilty of a violation of ordinance No. 3 of the municipality of Orion, Bataan; and, in accordance
therewith, shall be sentenced to the maximum penalty of the payment of a fine of P200, or to
subsidiary imprisonment in case of insolvency, with the costs of all three instances against him. So
ordered.
Arellano, C.J., Torres, Araullo and Avanceña, JJ., concur.
Separate Opinions
JOHNSON, J., concurring:
 I concur upon the ground that the ordinance in question is fully authorized under the
"general welfare" provisions of the Municipal Code.
STREET, J., concurring:
I agree in the conclusion that the ordinance passed by the municipality of Orion prohibiting
the playing of panguingue on secular days is valid and am of the opinion that the authority to pass
such an ordinance is to be found exclusively in Section 2184 of the Administrative Code (1916), which
gives a general authority for the enactment of ordinances which seem proper to improve the morals
and good order of the community. As the game of panguingue is admittedly not a game of chance or
hazard played for money, it is not within the prohibitions of Act No. 1757; and I think the case should
be determined without reference to the legislation against gambling and without reference to the
circumstance that under subsection (j) of Section 2188 of the same Code the Legislature has made it
mandatory upon municipal councils to prohibit and penalize gambling.
The legislature has clearly authorized the municipal council to use its discretion as to the
measures which it esteems desirable to promote morals and good order; and I know of no rule of law
which would justify any court in overruling that discretion in such a matter as is now before us.
Certainly I would be sorry to see this court adopt a paternalistic attitude of captious criticism and
correction tending to embarrass the free exercise of the legislative discretion vested by law in the
municipal councils. Those bodies are undoubtedly destined to make mistakes in the exercise of the
powers conferred on them, but there is no better school than that of experience in which their
members may discover what is most likely to promote the welfare of the community and the interests
of their constituents.
As already suggested, I think that the Gambling Law (Act No. 1757) and the provisions of
the Municipal Code relative to the suppression of gambling, strictly speaking, have nothing to do with
the case; and the circumstance that those measures are upon the statute book cannot serve in the
slightest degree to limit the powers of a municipal council in legislating upon a matter not implicated
with gambling. From the preamble to the ordinance it may be seen that the council had in view the
promotion of the general well-being and the advancement of prosperity in the community; and the
ordinance was doubtless intended to discourage the playing of games which involve a frivolous and
idle waste of time, rather than directly to suppress gambling. But even if the council had supposed that
the games which it proposed to regulate are calculated to foment the gambling instinct and should be
suppressed for that reason, the ordinance in question could not possibly have been rendered invalid
by that fact.
FISHER, J., dissenting:
The importance of suppressing gambling, properly emphasized in the majority opinion,
cannot warrant a conviction where gambling is not involved. The zeal to remedy an evil should not
induce the graver evil of obliterating legal landmarks.
Gambling is the playing, for money or its equivalent, of any game of which the result
depends "wholly or chiefly upon chance or hazard, . . ." (Act No. 1757).
The defendant herein is accused of playing pangiungue, which is avowedly not a game of
chance or hazard within this definition. It is not alleged in the information that the playing was for
money or any other thing of value. The fact that some money was found on the table when the
accused was arrested is immaterial in this case. The ordinance under which the conviction was had
does not make playing the prohibited games for money an ingredient of the offense. and the decision
of the majority proceeds upon the theory that the result would have been the same had no money
been staked upon the game.
To play a game of skill without risking anything upon the outcome is not gambling, and the
prohibition of harmless amusements cannot be justified by the authority to prohibit gambling.
In recognition of the fact that the ordinance upon which is based this prosecution goes
beyond the terms of the statutory authority, it is sought to find power to pass the same under the
general welfare clause (Section 2238, Administrative Code of 1917). But the ordinance which
imposes a fine and imprisonment upon a man and wife who play a game of cards together as mere
pastime, in their own home, without risking a cent upon the outcome, is beyond the protection of such
general provision for two reasons. In the first place, it is unreasonably subversive of the liberty of the
citizen and unnecessary. In the second place, the Legislature of the Islands has spoken in well
defined terms on the subject of gambling, and its pronouncement on the subject fills the field and
precludes the possibility of stretching the authority delegated to municipalities into the right to repeal,
modify or supplement existing legislation.
The subject of gambling has merited the attention of our Legislature and Act No. 1757 very
clearly defines the intention and will of that body in the premises. Its limitation of the prohibition is its
refusal to prohibit games of skill and games in which no value is at stake, and is the exact equivalent of
a pronouncement that non-gambling pastimes shall not be prohibited.
When the legislature authorized municipalities to "penalize . . . gambling" it was aiming at
the vice of risking money upon the hazard of a game of chance. The Legislature has not prohibited the
playing of card games — in itself an innocent pastime — but the playing for money of games of hazard.
When it delegated like power to municipalities it had a like object in view and no other.
Equally untenable, to my mind, is the attempt to justify the statute under the "general
welfare" clause. The prohibition by ordinance of the playing of certain card games as an amusement,
without stake or wager, cannot be said to promote the health, safety, morals, peace, good order,
comfort or convenience of the inhabitants of a municipality. The majority opinion contends that the
purpose of the enactment was to "improve the morals and stimulate the industry of the people."
Unfortunately for that theory it appears that the ordinance expressly permits these "immoral"
diversions on Sundays and official holidays. I am unable to see how one's morals are to be improved
by permitting him to play panguingue, poker or burro all day Sunday, and then sending him to jail for
engaging in the same amusement Monday evening. So far as the "stimulation of . . . industry" is
concerned, that argument might have had some weight if the prohibition of these amusements had
been limited to working hours. But such is not the case. The inhabitants of Orion may play poker —
without a wager — to their heart's content on Sunday, but to do it Saturday evening, after the work of
the week is over, is prohibited — their morals are to be "improved" and their industry "stimulated" until
midnight. After that they may yield to their depraved instincts until midnight of Sunday, without let or
hindrance. I submit that it is obvious that the ordinance in question was intended to prevent gambling,
but is not warranted by the delegated authority of municipal councils over this subject, because it is so
drawn as to include harmless amusements not within the legislative definition of gambling. By limiting
the definition and prohibition of gambling to the playing for money of games of hazard, the Legislature
by implication permitted the playing of all other games not within the prohibition. Is the "general
welfare" clause of grant of power to municipal corporation to be so construed as to make the express
delegation of power redundant and useless? If under the general welfare clause the playing of whist or
chess in one's own house, not for money but merely for amusement, may be prohibited under the
general welfare clause, certainly the power "to penalize and prohibit . . . gambling" must have been
included in that clause. If so, the special grant relating to gambling is merely redundant.
I submit that when a special power to enact ordinances is granted to a municipal council
upon a particular subject, the power as to that matter is to be measured by the express grant, without
enlargement by the interpretation of the general "welfare clause." The express grant of power to
regulate public dance halls (Section 2243 [k], Administrative Code of 1917) is not to be expanded
under the general "welfare clause" so as to authorize the prohibition and penalizing of dancing in
private houses. The express grant of power to establish and maintain streets cannot be expanded, ||| (U.S. v. Salaveria, G.R. No. 13678, [November 12, 1918], 39 PHIL 102-120)
under the general welfare clause, this court has held, so as to authorize an ordinance to compel
citizen to clean the streets. (U.S. vs. Gaspay, 33 Phil. Rep., 96.)

I think the law on this subject is correctly expressed in Judge Dillon's authoritative work on
Municipal Corporations as follows:
"When there are both special and general provisions, the power to pass
by-laws under the special or express grant can only be exercised in the cases and
to the extent, as respects those matters, allowed by the charter or incorporating act;
and the power to pass by-laws under the general clause does not enlarge or annul
the power conferred by the special provisions in relation to their various subject
matters, but gives authority to pass by-laws, reasonable in their character, upon all
other matters within the scope of their municipal authority, and not repugnant to the
Constitution and general laws of the State."
But if we disregard entirely the delegated power relating to the prohibition of gambling and
consider the matter from the standpoint of the general welfare clause alone, it seems equally clear to
me that the ordinance in question is void as being contrary to the public legislative policy, as
established by the Philippine Legislature. In Dillon on municipal Corporations (fifth edition, paragraph
601) it is said:
". . . A municipal corporation . . . cannot, in virtue of its incidental power to
pass by-laws, or under any general grant of that authority, adopt by-laws which
infringe the spirit or are repugnant to the policy of the State as declared in its
general legislation. This principle is well exemplified by a case in Ohio (Marietta vs.
Fearing, 4 Ohio, 427) in which incorporated towns were, by statute, prohibited from
subjecting stray animals owned by persons not residents of such towns to their
corporation ordinances. It was held that an ordinance operating, not on the animals
but on the non-resident owner, in the shape of a penalty, violated the spirit of the
statute, and was void. So, in a later case in the same State, it was shown that the
general policy of the State was to allow animals to run at large; and it was ruled that
a municipal corporation with power to pass 'all by-laws deemed necessary for the
well regulation, health, cleanliness &c.,' of the borough, and with power to 'abate
nuisances,' had no authority to pass a by-law restraining cattle from running at large,
such a by-law being in contravention of the general law of the State. (Collins vs.
Hatch, 18 Ohio, 523.)"
The public legislative policy is to permit the playing of card games as an amusement,
without wagers upon the outcome. That is shown by the language of Act No. 1757, which, by limiting
the prohibition of gambling to games of chance or hazard played for money, by implication permits the
playing of games not prohibited, and by the fact that the Tariff Act in force (Section 3) by prohibiting
the importation of marked cards impliedly authorizes the importation of others.
Panguingue playing may be so harmful to the people of this country that the playing of it at
any time, at any place, with or without the wagering of money, should be prohibited. If that is so
the Legislature should prohibit it. Some people regard dancing and billiards as equally harmful. If such
people happen to control a given municipal council we may see respectable citizens in jail for the
offense of dancing in their own homes, for playing casino or billiards, or ping-pong, or for engaging in
any other amusement which, while not prohibited by any general law, may be prohibited in any
municipality under this omnibus general welfare clause.
 EN BANC
[G.R. No. 161107. March 12, 2013.]
HON. MA. LOURDES C. FERNANDO, in her capacity as City Mayor of Marikina
City, JOSEPHINE C. EVANGELISTA, in her capacity as Chief, Permit Division,
Office of the City Engineer, and ALFONSO ESPIRITU, in his capacity as City
Engineer of Marikina City, petitioners,vs.ST. SCHOLASTICA'S COLLEGE and
ST. SCHOLASTICA'S ACADEMY-MARIKINA, INC., respondents.
DECISION
MENDOZA, J p:
Before this Court is a petition for review on certiorari under Rule 45 of the Rules of Court, which
seeks to set aside the December 1, 2003 Decision 1 of the Court of Appeals (CA) in CA-G.R. SP No.
75691.
The Facts
Respondents St. Scholastica's College (SSC) and St. Scholastica's Academy-Marikina,
Inc. (SSA-Marikina) are educational institutions organized under the laws of the Republic of the Philippines,
with principal offices and business addresses at Leon Guinto Street, Malate, Manila, and at West Drive,
Marikina Heights, Marikina City, respectively. 2
Respondent SSC is the owner of four (4) parcels of land measuring a total of 56,306.80 square
meters, located in Marikina Heights and covered by Transfer Certificate Title (TCT) No. 91537. Located
within the property are SSA-Marikina, the residence of the sisters of the Benedictine Order, the formation
house of the novices, and the retirement house for the elderly sisters. The property is enclosed by a tall
concrete perimeter fence built some thirty (30) years ago. Abutting the fence along the West Drive are
buildings, facilities, and other improvements. 3
The petitioners are the officials of the City Government of Marikina. On September 30, 1994,
the Sangguniang Panlungsod of Marikina City enacted Ordinance No. 192, 4 entitled "Regulating the
Construction of Fences and Walls in the Municipality of Marikina." In 1995 and 1998, Ordinance Nos.
217 5 and 200 6 were enacted to amend Sections 7 and 5, respectively. Ordinance No. 192, as amended,
is reproduced hereunder, as follows: ITSacC
ORDINANCE No. 192
Series of 1994
ORDINANCE REGULATING THE CONSTRUCTION OF FENCES AND WALLS
IN THE MUNICIPALITY OF MARIKINA
WHEREAS, under Section 447.2 of Republic Act No. 7160 otherwise known as
the Local Government Code of 1991 empowers the Sangguniang Bayan as the
local legislative body of the municipality to "...Prescribe reasonable limits and
restraints on the use of property within the jurisdiction of the municipality, ...";
WHEREAS the effort of the municipality to accelerate its economic and physical
development, coupled with urbanization and modernization, makes imperative
the adoption of an ordinance which shall embody up-to-date and modern
technical design in the construction of fences of residential, commercial and
industrial buildings;
WHEREAS, Presidential Decree No. 1096, otherwise known as the National
Building Code of the Philippines, does not adequately provide technical
guidelines for the construction of fences, in terms of design, construction, and
criteria;
WHEREAS, the adoption of such technical standards shall provide more efficient
and effective enforcement of laws on public safety and security;
WHEREAS, it has occurred in not just a few occasions that high fences or walls
did not actually discourage but, in fact, even protected burglars, robbers, and
other lawless elements from the view of outsiders once they have gained ingress
into these walls, hence, fences not necessarily providing security, but becomes
itself a "security problem";
WHEREAS, to discourage, suppress or prevent the concealment of prohibited or
unlawful acts earlier enumerated, and as guardian of the people of Marikina, the
municipal government seeks to enact and implement rules and ordinances to
protect and promote the health, safety and morals of its constituents; ITaCEc
WHEREAS, consistent too, with the "Clean and Green Program" of the
government, lowering of fences and walls shall encourage people to plant more
trees and ornamental plants in their yards, and when visible, such trees and
ornamental plants are expected to create an aura of a clean, green and beautiful
environment for Marikeños;
WHEREAS, high fences are unsightly that, in the past, people planted on
sidewalks to "beautify" the façade of their residences but, however, become
hazards and obstructions to pedestrians;
WHEREAS, high and solid walls as fences are considered "un-neighborly"
preventing community members to easily communicate and socialize and
deemed to create "boxed-in" mentality among the populace;
WHEREAS, to gather as wide-range of opinions and comments on this proposal,
and as a requirement of the Local Government Code of 1991 (R.A. 7160),
theSangguniang Bayan of Marikina invited presidents or officers of homeowners
associations, and commercial and industrial establishments in Marikina to two
public hearings held on July 28, 1994 and August 25, 1994;
WHEREAS, the rationale and mechanics of the proposed ordinance were fully
presented to the attendees and no vehement objection was presented to the
municipal government;
NOW, THEREFORE, BE IT ORDAINED BY THE SANGGUNIANG BAYAN OF
MARIKINA IN SESSION DULY ASSEMBLED:
Section 1. Coverage. — This Ordinance regulates the construction of all fences,
walls and gates on lots classified or used for residential, commercial, industrial,
or special purposes.
Section 2. Definition of Terms. —
a. Front Yard — refers to the area of the lot fronting a street, alley or
public thoroughfare.
b. Back Yard — the part of the lot at the rear of the structure constructed
therein. AcDaEH
c. Open fence — type of fence which allows a view of "thru-see" of the
inner yard and the improvements therein. (Examples: wrought
iron, wooden lattice, cyclone wire)
d. Front gate — refers to the gate which serves as a passage of persons
or vehicles fronting a street, alley, or public thoroughfare.
Section 3. The standard height of fences or walls allowed under this
ordinance are as follows:
(1) Fences on the front yard — shall be no more than one (1) meter
in height. Fences in excess of one (1) meter shall be of an
open fence type, at least eighty percent (80%)
see-thru;and
(2) Fences on the side and back yard — shall be in accordance with the
provisions of P.D. 1096 otherwise known as the National
Building Code.
Section 4. No fence of any kind shall be allowed in areas specifically reserved or
classified as parks.
Section 5. In no case shall walls and fences be built within the five (5)
meter parking area allowance located between the front monument line
and the building line of commercial and industrial establishments and
educational and religious institutions.7
Section 6. Exemption. —
(1) The Ordinance does not cover perimeter walls of residential
subdivisions.
(2) When public safety or public welfare requires, the Sangguniang
Bayan may allow the construction and/or maintenance of walls
higher than as prescribed herein and shall issue a special
permit or exemption. SICDAa
Section 7. Transitory Provision. — Real property owners whose existing fences
and walls do not conform to the specifications herein are allowed adequate
period of time from the passage of this Ordinance within which to conform, as
follows:
(1) Residential houses — eight (8) years
(2) Commercial establishments — five (5) years
(3) Industrial establishments — three (3) years
(4) Educational institutions — five (5) years 8
(public and privately owned)
Section 8. Penalty. — Walls found not conforming to the provisions of this
Ordinance shall be demolished by the municipal government at the expense of
the owner of the lot or structure.
Section 9. The Municipal Engineering Office is tasked to strictly implement this
ordinance, including the issuance of the necessary implementing guidelines,
issuance of building and fencing permits, and demolition of non-conforming walls
at the lapse of the grace period herein provided.
Section 10. Repealing Clause.— All existing Ordinances and Resolutions, Rules
and Regulations inconsistent with the foregoing provisions are hereby repealed,
amended or modified.
Section 11. Separability Clause.— If for any reason or reasons, local executive
orders, rules and regulations or parts thereof in conflict with this Ordinance are
hereby repealed and/or modified accordingly.
Section 12. Effectivity. — This ordinance takes effect after publication. THcaDA
APPROVED: September 30, 1994
(Emphases supplied)
On April 2, 2000, the City Government of Marikina sent a letter to the respondents ordering them
to demolish and replace the fence of their Marikina property to make it 80% see-thru, and, at the same time,
to move it back about six (6) meters to provide parking space for vehicles to park. 9 On April 26, 2000, the
respondents requested for an extension of time to comply with the directive. 10 In response, the petitioners,
through then City Mayor Bayani F. Fernando, insisted on the enforcement of the subject ordinance.
Not in conformity, the respondents filed a petition for prohibition with an application for a writ of
preliminary injunction and temporary restraining order before the Regional Trial Court, Marikina, Branch
273 (RTC), docketed as SCA Case No. 2000-381-MK. 11
The respondents argued that the petitioners were acting in excess of jurisdiction in enforcing
Ordinance No. 192, asserting that such contravenes Section 1, Article III of the 1987 Constitution. That
demolishing their fence and constructing it six (6) meters back would result in the loss of at least 1,808.34
square meters, worth about P9,041,700.00, along West Drive, and at least 1,954.02 square meters, worth
roughly P9,770,100.00, along East Drive. It would also result in the destruction of the garbage house,
covered walk, electric house, storage house, comfort rooms, guards' room, guards' post, waiting area for
visitors, waiting area for students, Blessed Virgin Shrine, P.E. area, and the multi-purpose hall, resulting in
the permanent loss of their beneficial use. The respondents, thus, asserted that the implementation of the
ordinance on their property would be tantamount to an appropriation of property without due process of law;
and that the petitioners could only appropriate a portion of their property through eminent domain. They
also pointed out that the goal of the provisions to deter lawless elements and criminality did not exist as the
solid concrete walls of the school had served as sufficient protection for many years. 12 aTEAHc
 The petitioners, on the other hand, countered that the ordinance was a valid exercise of police
power, by virtue of which, they could restrain property rights for the protection of public safety, health,
morals, or the promotion of public convenience and general prosperity. 13
On June 30, 2000, the RTC issued a writ of preliminary injunction, enjoining the petitioners from
implementing the demolition of the fence at SSC's Marikina property. 14
Ruling of the RTC
On the merits, the RTC rendered a Decision, 15 dated October 2, 2002, granting the petition and
ordering the issuance of a writ of prohibition commanding the petitioners to permanently desist from
enforcing or implementing Ordinance No. 192 on the respondents' property.
The RTC agreed with the respondents that the order of the petitioners to demolish the fence at
the SSC property in Marikina and to move it back six (6) meters would amount to an appropriation of
property which could only be done through the exercise of eminent domain. It held that the petitioners could
not take the respondents' property under the guise of police power to evade the payment of just
compensation.
It did not give weight to the petitioners' contention that the parking space was for the benefit of
the students and patrons of SSA-Marikina, considering that the respondents were already providing for
sufficient parking in compliance with the standards under Rule XIX of the National Building Code.
It further found that the 80% see-thru fence requirement could run counter to the respondents'
right to privacy, considering that the property also served as a residence of the Benedictine sisters, who
were entitled to some sense of privacy in their affairs. It also found that the respondents were able to prove
that the danger to security had no basis in their case. Moreover, it held that the purpose of beautification
could not be used to justify the exercise of police power.
It also observed that Section 7 of Ordinance No. 192, as amended, provided for retroactive
application. It held, however, that such retroactive effect should not impair the respondents' vested
substantive rights over the perimeter walls, the six-meter strips of land along the walls, and the building,
structures, facilities, and improvements, which would be destroyed by the demolition of the walls and the
seizure of the strips of land. CaASIc
The RTC also found untenable the petitioners' argument that Ordinance No. 192 was a remedial
or curative statute intended to correct the defects of buildings and structures, which were brought about by
the absence or insufficiency of laws. It ruled that the assailed ordinance was neither remedial nor curative
in nature, considering that at the time the respondents' perimeter wall was built, the same was valid and
legal, and the ordinance did not refer to any previous legislation that it sought to correct.
The RTC noted that the petitioners could still take action to expropriate the subject property
through eminent domain.
The RTC, thus, disposed:
WHEREFORE,the petition is GRANTED.The writ of prohibition is hereby
issued commanding the respondents to permanently desist from enforcing or
implementing Ordinance No. 192, Series of 1994, as amended, on petitioners'
property in question located at Marikina Heights, Marikina, Metro Manila.
No pronouncement as to costs.
SO ORDERED.16
Ruling of the CA
In its December 1, 2003 Decision, the CA dismissed the petitioners' appeal and affirmed the RTC
decision.
The CA reasoned out that the objectives stated in Ordinance No. 192 did not justify the exercise
of police power, as it did not only seek to regulate, but also involved the taking of the respondents' property
without due process of law. The respondents were bound to lose an unquantifiable sense of security, the
beneficial use of their structures, and a total of 3,762.36 square meters of property. It, thus, ruled that the
assailed ordinance could not be upheld as valid as it clearly invaded the personal and property rights of the
respondents and "[f]or being unreasonable, and undue restraint of trade." 17 cDCEIA
It noted that although the petitioners complied with procedural due process in enacting
Ordinance No. 192, they failed to comply with substantive due process. Hence, the failure of the
respondents to attend the public hearings in order to raise objections did not amount to a waiver of their
right to question the validity of the ordinance.
The CA also shot down the argument that the five-meter setback provision for parking was a
legal easement, the use and ownership of which would remain with, and inure to, the benefit of the
respondents for whom the easement was primarily intended. It found that the real intent of the setback
provision was to make the parking space free for use by the public, considering that such would cease to be
for the exclusive use of the school and its students as it would be situated outside school premises and
beyond the school administration's control.
In affirming the RTC ruling that the ordinance was not a curative statute, the CA found that the
petitioner failed to point out any irregularity or invalidity in the provisions of the National Building Code that
required correction or cure. It noted that any correction in the Code should be properly undertaken by the
Congress and not by the City Council of Marikina through an ordinance.
The CA, thus, disposed:
WHEREFORE,all foregoing premises considered, the instant appeal is
DENIED. The October 2, 2002 Decision and the January 13, 2003 Order of the
Regional Trial Court (RTC) of Marikina City, Branch 273, granting
petitioners-appellees' petition for Prohibition in SCA Case No. 2000-381-MK are
hereby AFFIRMED.
SO ORDERED.18
Aggrieved by the decision of the CA, the petitioners are now before this Court presenting the
following: CHEIcS
ASSIGNMENT OF ERRORS
1. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN
DECLARING THAT CITY ORDINANCE NO. 192, SERIES OF 1994 IS
NOT A VALID EXERCISE OF POLICE POWER;
2. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN
RULING THAT THE AFOREMENTIONED ORDINANCE IS AN
EXERCISE OF THE CITY OF THE POWER OF EMINENT DOMAIN;
3. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN
DECLARING THAT THE CITY VIOLATED THE DUE PROCESS
CLAUSE IN IMPLEMENTING ORDINANCE NO. 192, SERIES OF 1994;
AND
 4. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN
RULING THAT THE ABOVE-MENTIONED ORDINANCE CANNOT BE
GIVEN RETROACTIVE APPLICATION. 19
In this case, the petitioners admit that Section 5 of the assailed ordinance, pertaining to the
five-meter setback requirement is, as held by the lower courts, invalid.20 Nonetheless, the petitioners
argue that such invalidity was subsequently cured by Zoning Ordinance No. 303, series of 2000. They also
contend that Section 3, relating to the 80% see-thru fence requirement, must be complied with, as it
remains to be valid.
Ruling of the Court
The ultimate question before the Court is whether Sections 3.1 and 5 of Ordinance No. 192 are
valid exercises of police power by the City Government of Marikina. DCASIT
"Police power is the plenary power vested in the legislature to make statutes and ordinances to
promote the health, morals, peace, education, good order or safety and general welfare of the
people." 21 The State, through the legislature, has delegated the exercise of police power to local
government units, as agencies of the State. This delegation of police power is embodied in Section 16 22 of
the Local Government Code of 1991 (R.A. No. 7160), known as the General Welfare Clause, 23 which
has two branches. "The first, known as the general legislative power, authorizes the municipal council to
enact ordinances and make regulations not repugnant to law, as may be necessary to carry into effect and
discharge the powers and duties conferred upon the municipal council by law. The second, known as the
police power proper, authorizes the municipality to enact ordinances as may be necessary and proper for
the health and safety, prosperity, morals, peace, good order, comfort, and convenience of the municipality
and its inhabitants, and for the protection of their property." 24
White Light Corporation v. City of Manila, 25 discusses the test of a valid ordinance:
The test of a valid ordinance is well established. A long line of decisions
including City of Manila has held that for an ordinance to be valid, it must not only be
within the corporate powers of the local government unit to enact and pass
according to the procedure prescribed by law, it must also conform to the following
substantive requirements: (1) must not contravene the Constitution or any statute;
(2) must not be unfair or oppressive; (3) must not be partial or discriminatory; (4)
must not prohibit but may regulate trade; (5) must be general and consistent with
public policy; and (6) must not be unreasonable. 26
Ordinance No. 192 was passed by the City Council of Marikina in the apparent exercise of its
police power. To successfully invoke the exercise of police power as the rationale for the enactment of an
ordinance and to free it from the imputation of constitutional infirmity, two tests have been used by the Court
— the rational relationship test and the strict scrutiny test: ASEcHI
We ourselves have often applied the rational basis test mainly in analysis
of equal protection challenges. Using the rational basis examination, laws or
ordinances are upheld if they rationally further a legitimate governmental interest.
Under intermediate review, governmental interest is extensively examined and the
availability of less restrictive measures is considered. Applying strict scrutiny, the
focus is on the presence of compelling, rather than substantial, governmental
interest and on the absence of less restrictive means for achieving that interest. 27
Even without going to a discussion of the strict scrutiny test, Ordinance No. 192, series of 1994
must be struck down for not being reasonably necessary to accomplish the City's purpose. More
importantly, it is oppressive of private rights.
Under the rational relationship test, an ordinance must pass the following requisites as discussed
in Social Justice Society (SJS) v. Atienza, Jr.: 28
As with the State, local governments may be considered as having
properly exercised their police power only if the following requisites are met: (1) the
interests of the public generally, as distinguished from those of a particular class,
require its exercise and (2) the means employed are reasonably necessary for the
accomplishment of the purpose and not unduly oppressive upon individuals. In
short, there must be a concurrence of a lawful subject and lawful method. 29
Lacking a concurrence of these two requisites, the police power measure shall be struck down as
an arbitrary intrusion into private rights and a violation of the due process clause. 30
Section 3.1 and 5 of the assailed ordinance are pertinent to the issue at hand, to wit: cDAISC
Section 3. The standard height of fences of walls allowed under this
ordinance are as follows:
(1) Fences on the front yard — shall be no more than one (1) meter in
height. Fences in excess of one (1) meter shall be an open
fence type, at least eighty percent (80%) see-thru;
xxx xxx xxx
Section 5.In no case shall walls and fences be built within the five (5)
meter parking area allowance located between the front monument line and the
building line of commercial and industrial establishments and educational and
religious institutions.
The respondents, thus, sought to prohibit the petitioners from requiring them to (1) demolish their
existing concrete wall, (2) build a fence (in excess of one meter) which must be 80% see-thru, and (3) build
the said fence six meters back in order to provide a parking area.
Setback Requirement
The Court first turns its attention to Section 5 which requires the five-meter setback of the fence
to provide for a parking area. The petitioners initially argued that the ownership of the parking area to be
created would remain with the respondents as it would primarily be for the use of its students and faculty,
and that its use by the public on non-school days would only be incidental. In their Reply, however, the
petitioners admitted that Section 5 was, in fact, invalid for being repugnant to theConstitution. 31
The Court agrees with the latter position.
The Court joins the CA in finding that the real intent of the setback requirement was to make the
parking space free for use by the public, considering that it would no longer be for the exclusive use of the
respondents as it would also be available for use by the general public. Section 9 of Article III of the 1987
Constitution, a provision on eminent domain, provides that private property shall not be taken for public use
without just compensation. IDCHTE
The petitioners cannot justify the setback by arguing that the ownership of the property will
continue to remain with the respondents. It is a settled rule that neither the acquisition of title nor the total
destruction of value is essential to taking. In fact, it is usually in cases where the title remains with the
private owner that inquiry should be made to determine whether the impairment of a property is merely
regulated or amounts to a compensable taking. 32 The Court is of the view that the implementation of the
setback requirement would be tantamount to a taking of a total of 3,762.36 square meters of the
respondents' private property for public use without just compensation, in contravention to the
Constitution.
Anent the objectives of prevention of concealment of unlawful acts and "un-neighborliness," it is
obvious that providing for a parking area has no logical connection to, and is not reasonably necessary for,
the accomplishment of these goals.
Regarding the beautification purpose of the setback requirement, it has long been settled that the
State may not, under the guise of police power, permanently divest owners of the beneficial use of their
property solely to preserve or enhance the aesthetic appearance of the community. 33 The Court, thus,
finds Section 5 to be unreasonable and oppressive as it will substantially divest the respondents of the
beneficial use of their property solely for aesthetic purposes. Accordingly, Section 5 of Ordinance No. 192
is invalid.
The petitioners, however, argue that the invalidity of Section 5 was properly cured by Zoning
Ordinance No. 303, 34 Series of 2000, which classified the respondents' property to be within an
institutional zone, under which a five-meter setback has been required.
The petitioners are mistaken. Ordinance No. 303, Series of 2000, has no bearing to the case at
hand. AcSHCD
The Court notes with displeasure that this argument was only raised for the first time on appeal in
this Court in the petitioners' Reply. Considering that Ordinance No. 303 was enacted on December 20,
2000, the petitioners could very well have raised it in their defense before the RTC in 2002. The settled rule
in this jurisdiction is that a party cannot change the legal theory of this case under which the controversy
was heard and decided in the trial court. It should be the same theory under which the review on appeal is
conducted. Points of law, theories, issues, and arguments not adequately brought to the attention of the
lower court will not be ordinarily considered by a reviewing court, inasmuch as they cannot be raised for the
first time on appeal. This will be offensive to the basic rules of fair play, justice, and due process. 35
Furthermore, the two ordinances have completely different purposes and subjects. Ordinance
No. 192 aims to regulate the construction of fences, while Ordinance No. 303 is a zoning ordinance which
classifies the city into specific land uses. In fact, the five-meter setback required by Ordinance No. 303
does not even appear to be for the purpose of providing a parking area.
By no stretch of the imagination, therefore, can Ordinance No. 303, "cure" Section 5 of
Ordinance No. 192.
In any case, the clear subject of the petition for prohibition filed by the respondents is Ordinance
No. 192 and, as such, the precise issue to be determined is whether the petitioners can be prohibited from
enforcing the said ordinance, and no other, against the respondents.
80% See-Thru Fence Requirement
The petitioners argue that while Section 5 of Ordinance No. 192 may be invalid, Section 3.1
limiting the height of fences to one meter and requiring fences in excess of one meter to be at least 80%
see-thru, should remain valid and enforceable against the respondents.
The Court cannot accommodate the petitioner. HDcaAI
For Section 3.1 to pass the rational relationship test, the petitioners must show the reasonable
relation between the purpose of the police power measure and the means employed for its accomplishment,
for even under the guise of protecting the public interest, personal rights and those pertaining to private
property will not be permitted to be arbitrarily invaded. 36
The principal purpose of Section 3.1 is "to discourage, suppress or prevent the concealment of
prohibited or unlawful acts." The ultimate goal of this objective is clearly the prevention of crime to ensure
public safety and security. The means employed by the petitioners, however, is not reasonably necessary
for the accomplishment of this purpose and is unduly oppressive to private rights.
The petitioners have not adequately shown, and it does not appear obvious to this Court, that an
80% see-thru fence would provide better protection and a higher level of security, or serve as a more
satisfactory criminal deterrent, than a tall solid concrete wall. It may even be argued that such exposed
premises could entice and tempt would-be criminals to the property, and that a see-thru fence would be
easier to bypass and breach. It also appears that the respondents' concrete wall has served as more than
sufficient protection over the last 40 years.
As to the beautification purpose of the assailed ordinance, as previously discussed, the State
may not, under the guise of police power, infringe on private rights solely for the sake of the aesthetic
appearance of the community. Similarly, the Court cannot perceive how a see-thru fence will foster
"neighborliness" between members of a community.
Compelling the respondents to construct their fence in accordance with the assailed ordinance is,
thus, a clear encroachment on their right to property, which necessarily includes their right to decide how
best to protect their property.
It also appears that requiring the exposure of their property via a see-thru fence is violative of
their right to privacy, considering that the residence of the Benedictine nuns is also located within the
property. The right to privacy has long been considered a fundamental right guaranteed by the
Constitution that must be protected from intrusion or constraint. The right to privacy is essentially the right
to be let alone, 37 as governmental powers should stop short of certain intrusions into the personal life of its
citizens. 38 It is inherent in the concept of liberty, enshrined in the Bill of Rights (Article III) in Sections 1, 2,
3 (1), 6, 8, and 17, Article III of the 1987 Constitution. 39 CSaITD
The enforcement of Section 3.1 would, therefore, result in an undue interference with the
respondents' rights to property and privacy. Section 3.1 of Ordinance No. 192 is, thus, also invalid and
cannot be enforced against the respondents.
No Retroactivity
Ordinance No. 217 amended Section 7 of Ordinance No. 192 by including the regulation of
educational institutions which was unintentionally omitted, and giving said educational institutions five (5)
years from the passage of Ordinance No. 192 (and not Ordinance No. 217) to conform to its
provisions. 40 The petitioners argued that the amendment could be retroactively applied because the
assailed ordinance is a curative statute which is retroactive in nature.
Considering that Sections 3.1 and 5 of Ordinance No. 192 cannot be enforced against the
respondents, it is no longer necessary to rule on the issue of retroactivity. The Court shall, nevertheless,
pass upon the issue for the sake of clarity.
"Curative statutes are enacted to cure defects in a prior law or to validate legal proceedings
which would otherwise be void for want of conformity with certain legal requirements. They are intended to
supply defects, abridge superfluities and curb certain evils. They are intended to enable persons to carry
into effect that which they have designed or intended, but has failed of expected legal consequence by
reason of some statutory disability or irregularity in their own action. They make valid that which, before the
enactment of the statute was invalid. Their purpose is to give validity to acts done that would have been
invalid under existing laws, as if existing laws have been complied with. Curative statutes, therefore, by
their very essence, are retroactive." 41
 The petitioners argue that Ordinance No. 192 is a curative statute as it aims to correct or cure a
defect in the National Building Code, namely, its failure to provide for adequate guidelines for the
construction of fences. They ultimately seek to remedy an insufficiency in the law. In aiming to cure this
insufficiency, the petitioners attempt to add lacking provisions to the National Building Code. This is not
what is contemplated by curative statutes, which intend to correct irregularities or invalidity in the law. The
petitioners fail to point out any irregular or invalid provision. As such, the assailed ordinance cannot qualify
as curative and retroactive in nature. aIcHSC

At any rate, there appears to be no insufficiency in the National Building Code with respect to
parking provisions in relation to the issue of the respondents. Paragraph 1.16.1, Rule XIX of the Rules and
Regulations of the said code requires an educational institution to provide one parking slot for every ten
classrooms. As found by the lower courts, the respondents provide a total of 76 parking slots for their 80
classrooms and, thus, had more than sufficiently complied with the law.

Ordinance No. 192, as amended, is, therefore, not a curative statute which may be applied
retroactively.

Separability
Sections 3.1 and 5 of Ordinance No. 192, as amended, are, thus, invalid and cannot be enforced
against the respondents. Nonetheless, "the general rule is that where part of a statute is void as repugnant
to the Constitution, while another part is valid, the valid portion, if susceptible to being separated from the
invalid, may stand and be enforced." 42 Thus, the other sections of the assailed ordinance remain valid
and enforceable.

Conclusion
Considering the invalidity of Sections 3.1 and 5, it is clear that the petitioners were acting in
excess of their jurisdiction in enforcing Ordinance No. 192 against the respondents. The CA was correct in
affirming the decision of the RTC in issuing the writ of prohibition. The petitioners must permanently desist
from enforcing Sections 3.1 and 5 of the assailed ordinance on the respondents' property in Marikina City.

WHEREFORE,the petition is DENIED.The October 2, 2002 Decision of the Regional Trial Court
in SCA Case No. 2000-381-MK is AFFIRMED but MODIFIED to read as follows:

WHEREFORE,the petition is GRANTED.The writ of prohibition is hereby

issued commanding the respondents to permanently desist from enforcing or
implementing Sections 3.1 and 5 of Ordinance No. 192, Series of 1994, as
amended, on the petitioners' property in question located in Marikina Heights,
Marikina, Metro Manila. HDITCS

No pronouncement as to costs.

SO ORDERED.

Sereno, C.J.,Carpio, Velasco, Jr.,Leonardo-de Castro, Brion, Peralta, Bersamin, Del Castillo,
Abad, Villarama, Jr.,Reyes, Perlas-Bernabe and Leonen, JJ., concur.

Perez, J., is on official leave.

||| (Fernando v. St. Scholastica's College, G.R. No. 161107, [March 12, 2013], 706 PHIL 138-166)
 EN BANC
[G.R. No. L-23825. December 24, 1965.]
EMMANUEL PELAEZ, petitioner, vs. THE AUDITOR GENERAL, respondent.
Zulueta, Gonzales, Paculdo & Associates for petitioner.
Solicitor General for respondent.
SYLLABUS
1. ADMINISTRATIVE LAW; POWER OF PRESIDENT TO CREATE MUNICIPALITIES. —
Since January 1, 1960, when Republic Act No. 2370 became effective, barrios may "not be created or
their boundaries altered nor their names changed" except by Act of Congress or of the corresponding
provincial board "upon petition of a majority of the voters in the areas affected" and the
"recommendation of the council of the municipality or municipalities in which the proposed barrio is
situated." This statutory denial of the presidential authority to create a new barrio implies a negation of
the bigger power to create municipalities, each of which consists of several barrios.
2. ID.; ID.; NATURE OF POWER TO CREATE MUNICIPALITIES. — Whereas the power to
fix a common boundary, in order to avoid or settle conflicts of jurisdiction between adjoining
municipalities, may partake of an administrative nature — involving, as it does, the adoption of means
and ways to carry into effect the law creating said municipalities — the authority to create municipal
corporations is essentially legislative in nature.
3. ID.; ID.; ID.; REQUISITES FOR VALID DELEGATION OF POWER. — Although
Congress may delegate to another branch of the Government the power to fill in the details in the
execution, enforcement or administration of a law, it is essential that said law: (a) be complete in itself,
setting forth therein the policy to be executed, carried out or implemented by the delegate; and (b) fix
a standard - the limits of which are sufficiently determinate or determinable to which the delegate must
conform in the performance of his functions.
4. ID.; ID.; ID.; ID.; REQUIREMENTS OF DUE DELEGATION OF POWER NOT MET BY
SECTION 68 OF REVISED ADMINISTRATIVE CODE. — Section 68 of theRevised Administrative
Code, insofar as it grants to the President the power to create municipalities, does not meet the
well-settled requirements for a valid delegation of the power to fix the details in the enforcement of a
law. It does not enunciate any policy to be carried out or implemented by the President.
5. ID.; ID.; ID.; ID.; ID.; ABDICATION OF POWERS OF CONGRESS IN FAVOR OF THE
EXECUTIVE. — If the validity of said delegation of powers, made in Section 68 of the Revised
Administrative Code, were upheld, there would no longer be any legal impediment to a statutory grant
of authority to the President to do anything which, in his opinion, may be required by public welfare or
public interest. Such grant of authority would be a virtual abdication of the powers of Congress in favor
of the Executive, and would bring about a total collapse of the democratic system established by
the Constitution.
6. ID.; ID.; ID.; NATURE OF POWERS DEALT WITH IN SECTION 68 OF THE REVISED
ADMINISTRATIVE CODE. — It is true that in Calalang vs. Williams (70 Phil., 726) and People vs.
Rosenthal (68 Phil., 328), this Court had upheld "public welfare" and "public interest," respectively, as
sufficient standards, for a valid delegation of the authority to execute the law. But the doctrine laid
down in these cases must be construed in relation to the specific facts and issues involved therein,
outside of which they do not constitute precedents and have no binding effect. Both cases involved
grants to administrative officers of powers related to the exercise of their administrative functions,
calling for the determination of questions of fact. Such is not the nature of the powers dealt with in
Section 68 of the Revised Administrative Code. The creation of municipalities being essentially and
eminently legislative in character, the question whether or not "public interest" demands the exercise
of such power is not one of fact. It is purely a legislative question (Carolina- Virginia Coastal Highway
vs. Coastal Turnpike Authority, 74 S.E. 21., 310-313, 315-318), or a political question (Udall vs.
Severn, 79 p. 2d., 347-349).
7. ID.; ID., ID.; ID.; PROOF THAT ISSUANCE OF EXECUTIVE ORDERS IN QUESTION
ENTAILS EXERCISE OF PURELY LEGISLATIVE FUNCTIONS. — The fact that Executive Orders
Nos. 93 to 121, 124 and 126 to 129, creating thirty-three municipalities, were issued after the
legislative bills for the creation of the said municipalities had failed to pass Congress, is the best proof
that their issuance entails the exercise of purely legislative functions.
8. ID.; ID.; ID.; POWER OF CONTROL OVER LOCAL GOVERNMENTS. — The power of
control under Section 10(a) of Article X of the Constitution implies the right of the President to interfere
in the exercise of such discretion as may be vested by law in the officers of the executive departments,
bureaus or offices of the national government, as well as to act in lieu of such officers. This power is
denied by the Constitution to the Executive, insofar as local governments are concerned. With respect
to the latter, the fundamental law permits him to wield no more authority than that of checking whether
said local governments or the officers thereof perform their duties as provided by statutory
enactments. Hence, the President cannot interfere with local governments, so long as the same or its
officers act within the scope of their authority. He may not, for instance, suspend an elective official of
a regular municipality or take any disciplinary action against him, except on appeal from a decision of
the corresponding provincial board. If, on the other hand, the President could create a municipality, he
could, in effect, remove any of its officials, by creating a new municipality and including therein the
barrio in which the official concerned resides, for his office would thereby become vacant (Section
2179, Revised Administrative Code). Thus, by merely brandishing the power to create a new
municipality, without actually creating it, he could compel local officials to submit to his dictation,
thereby, in effect, exercising over them the power of control denied to him by the Constitution.
9. ID.; ID.; ID.; ID.; SECTION 68, REVISED ADMINISTRATIVE CODE, REPEALED BY
THE CONSTITUTION. — The power of control of the President over executive departments, bureaus
or offices under Section 10 (a) of Article X of the Constitution implies no more than the authority to
assume directly the functions thereof or to interfere in the exercise of discretion by its officials.
Manifestly, such control does not include the authority either to abolish an executive department or
bureau, or to create a new one. As a consequence, the alleged power of the President to create
municipal corporations would necessarily connote the exercise by him of an authority even greater
than that of control which he has over the executive departments, bureaus or offices. Instead of giving
the President less power over local governments than that vested in him over the executive
departments, bureaus or offices, it reverses the process and does the exact opposite, by conferring
upon him more power over municipal corporations than that which he has over executive departments,
bureaus or offices. Even if, therefore, it did not entail an undue delegation of legislative powers, as it
certainly does, said Section 68, as part of the Revised Administrative Code, approved on March 10,
1917, must be deemed repealed by the subsequent adoption of the Constitution in 1935, which is
utterly incompatible and inconsistent with said statutory enactment. (De los Santos vs. Mallare, 87
Phil., 289, 298-299.)
10. ID. ID.; ID.; MUNICIPAL OFFICIALS CONCERNED DULY REPRESENTED IN
PRESENT CASE. — It is contended that not all the proper parties have been impleaded in the present
 case. Suffice it to say that the records do not show, and the parties do not claim, that the officers of
any of the municipalities concerned have been appointed or elected and have assumed office. At any
rate, the Solicitor-General, who has appeared on behalf of respondent Auditor General, is the officer
authorized by law "to act and represent the Government of the Philippines, its officers and agents, in
any official investigation, proceeding or matter requiring the services of a lawyer" (Section
1661, Revised Administrative Code), and, in connection with the creation of the municipalities
involved in this case, which involves a political, not proprietary functions, said local officials, if any, are
mere agents or representatives of the national government. Their interest in the case has accordingly
been duly represented. (Mangubat vs. Osmeña Jr., G.R. No. L-12837, April 30, 1959; City of Cebu vs.
Judge Piccio, G.R. Nos. L-13012 & L-14876, December 31, 1960.)
11. ID.; ID.; ACTION NOT PREMATURE. — The present action cannot be said to be
premature simply because respondent Auditor General has not yet acted on any of the executive
orders in question and has not intimated how he would act in connection therewith. It is a matter of
common knowledge that the President has for many years issued executive orders creating municipal
corporations and that the same have been organized and are in actual operation, thus indicating,
without peradventure of doubt, that the expenditures incidental thereto have been sanctioned,
approved or passed in audit by the General Auditing Office and its officials. There is no reason to
believe that respondent would adopt a different policy as regards the new municipalities involved in
this case, in the absence of an allegation to such effect, and none has been made by him.
DECISION
CONCEPCION, J p:
During the period from September 4 to October 29, 1964 the President of the Philippines,
purporting to act pursuant to Section 68 of the Revised Administrative Code, issued Executive Orders
Nos. 93 to 121, 124 and 126 to 129, creating thirty-three (33) municipalities enumerated in the
margin. 1 Soon after the date last mentioned, or on November 10, 1964, petitioner Emmanuel Pelaez,
as Vice-President of the Philippines and as taxpayer, instituted the present special civil action, for a
writ of prohibition with preliminary injunction, against the Auditor General, to restrain him, as well as
his representatives and agents, from passing in audit any expenditure of public funds in
implementation of said executive orders and/or any disbursement by said municipalities.
Petitioner alleges that said executive orders are null and void, upon the ground that said
Section 68 has been impliedly repealed by Republic Act 2370 and constitutes an undue delegation of
legislative power. Respondent maintains the contrary view and avers that the present action is
premature and that not all proper parties — referring to the officials of the new political subdivisions in
question — have been impleaded. Subsequently, the mayors of several municipalities adversely
affected by the aforementioned executive orders — because the latter have taken away from the
former the barrios composing the new political subdivision — intervened in the case. Moreover,
Attorneys Enrique M. Fernando and Emma Quisumbing-Fernando were allowed to and did appear
as amici curiae.
The third paragraph of Section 3 of Republic Act No. 2370, reads:
"Barrios shall not be created or their boundaries altered nor their
names changed except under the provisions of this Act or by Act of
Congress.
Pursuant to the first two (2) paragraphs of the same Section 3:
"All barrios existing at the time of the passage of this Act shall
come under the provisions hereof.
"Upon petition of a majority of the voters in the areas affected, a
new barrio may be created or the name of an existing one may be changed
by the provincial board of the province, upon recommendation of the council
of the municipality or municipalities in which the proposed barrio is situated.
The recommendation of the municipal council shall be embodied in a
resolution approved by at least two-thirds of the entire membership of the
said council:Provided, however, That no new barrio may be created if its
population is less than five hundred persons."
Hence, since January 1, 1960, when Republic Act No. 2370 became effective, barrios may
"not be created or their boundaries altered nor their names changed" except by Act of Congress or of
the corresponding provincial board "upon petition of a majority of the voters in the areas affected" and
the "recommendation of the council of the municipality or municipalities in which the proposed barrio is
situated." Petitioner argues, accordingly: "If the President, under this new law, cannot even create a
barrio, can he create a municipality which is composed of several barrios, since barrios are units of
municipalities?"
Respondent answers in the affirmative, upon the theory that a new municipality can be
created without creating new barrios, such as, by placing old barrios under the jurisdiction of the new
municipality. This theory overlooks, however, the main import of the petitioner's argument, which is
that the statutory denial of the presidential authority to create a new barrio implies a negation of the
bigger power to create municipalities, each of which consists of several barrios. The cogency and
force of this argument is too obvious to be denied or even questioned. Founded upon logic and
experience, it cannot be offset except by a clear manifestation of the intent of Congress to the contrary,
and no such manifestation, subsequent to the passage of Republic Act No. 2370. has been brought to
our attention.
Moreover, section 68 of the Revised Administrative Code, upon which the disputed
executive orders are based, provides:
"The (Governor-General) President of the Philippines may by
executive order define the boundary, or boundaries, of any province,
sub-province, municipality, [township] municipal district or other political
subdivision, and increase or diminish the territory comprised therein, may
divide any province into one or more subprovinces, separate any political
division other than a province, into such portions as may be required, merge
any of such subdivisions or portions with another, name any new
subdivision so created, and may change the seat of government within any
subdivision to such place therein as the public welfare may
require: Provided, That the authorization of the (Philippine Legislature)
Congress of the Philippines shall first be obtained whenever the boundary
of any province or subprovince is to be defined or any province is to be
divided into one or more subprovinces. When action by the
(Governor-General) President of the Philippines in accordance herewith
makes necessary a change of the territory under the jurisdiction of any
administrative officer or any judicial officer, the (Governor-General)
President of the Philippines, with the recommendation and advice of the
head of the Department having executive control of such officer, shall
 redistrict the territory of the several officers affected and assign such
officers to the new districts so formed.
"Upon the changing of the limits of political divisions in pursuance
of the foregoing authority, an equitable distribution of the funds and
obligations of the divisions thereby affected shall be made in such manner
as may be recommended by the (Insular Auditor) Auditor General and
approved by the (Governor-General) President of the Philippines."
Respondent alleges that the power of the President to create municipalities under this
section does not amount to an undue delegation of legislative power, relying upon Municipality of
Cardona vs. Municipality of Binañgonan (36 Phil. 547), which, he claims, has settled it. Such claim is
untenable, for said case involved, notthe creation of a new municipality, but a mere transfer of territory
— from an already existing municipality (Cardona) to another municipality (Binañgonan), likewise,
existing at the time of and prior to said transfer (See Gov't of the P.I. ex rel.Municipality of Cardona vs.
Municipality of Binañgonan [34 Phil. 518, 519-520], — in consequence of the fixing and definition,
pursuant to Act No. 1748, of the common boundaries of two municipalities.
It is obvious, however, that, whereas the power to fix such common boundary, in order to
avoid or settle conflicts of jurisdiction between adjoining municipalities, may partake of
an administrative nature — involving, as it does, the adoption of means and ways to carry into
effect the law creating said municipalities — the authority to create municipal corporations is
essentially legislative in nature. In the language of other courts, it is "strictly a legislative function"
(State ex rel. Higgins vs. Aicklen, 119 S. 425, January 2, 1959) or "solely and exclusively the exercise
of legislative power" (Udall vs. Severn, May 29, 1938, 79 P. 2d. 347-349). As the Supreme Court of
Washington has put it (Territory ex rel. Kelly vs. Stewart, February 13, 1890, 23 Pac. 405, 409),
"municipal corporations are purely the creatures of statutes."
Although 1 Congress may delegate to another branch of the government the power to fill in
the details in the execution, enforcement or administration of a law, it is essential, to forestall a
violation of the principle of separation of powers, that said law: (a) be complete in itself — it must set
forth therein the policy to be executed, carried out or implemented by the delegate 2 — and (b) fix a
standard — the limits of which are sufficiently determinate or determinable — to which the delegate
must conform in the performance of his functions. 2 Indeed, without a statutory declaration of policy,
the delegate would, in effect, make or formulate such policy, which is the essence of every law; and,
without the aforementioned standard, there would be no means to determine, with reasonable
certainty, whether the delegate has acted within or beyond the scope of his authority. 2 Hence, he
could thereby arrogate upon himself the power, not only to make the law, but, also — and this is worse
— to unmake it, by adopting measures inconsistent with the end sought to be attained by the Act of
Congress, thus nullifying the principle of separation of powers and the system of checks and balances,
and, consequently undermining the very foundation of our Republican system.
Section 68 of the Revised Administrative Code does not meet these well settled
requirements for a valid delegation of the power to fix the details in the enforcement of a law. It does
not enunciate any policy to be carried out or implemented by the President. Neither does it give a
standard sufficiently precise to avoid the evil effects above referred to. In this connection, we do not
overlook the fact that, under the last clause of the first sentence of Section 68, the President:
". . . may change the seat of the government within any
subdivision to such place therein as the public welfare may require."
It is apparent, however, from the language of this clause, that the phrase "as the public
welfare may require" qualifies, not the clauses preceding the one just quoted, but only the place to
which the seat of the government may be transferred. This fact becomes more apparent when we
consider that said Section 68 was originally Section 1 of Act No. 1748, 3 which provided, that
"whenever in the judgment of the Governor-General the public welfare requires, he may, by executive
order", effect the changes enumerated therein (as well as in said Section 68), including the change of
the seat of the government "to such place . . . as the public interest requires". The opening statement
of said Section 1 of Act No. 1748 — which was not included in Section 68 of the Revised
Administrative Code — governed the time at which, or the conditions under which, the powers therein
conferred could be exercised; whereas the last part of the first sentence of said section
referredexclusively to the place to which the seat of the government was to be transferred.
At any rate, the conclusion would be the same, insofar as the case at bar is concerned,
even if we assumed that the phrase "as the public welfare may require", in said Section 68, qualifies
all other clauses thereof. It is true that in Calalang vs. Williams (70 Phil. 726) and People vs.
Rosenthal (68 Phil. 328), this Court had upheld "public welfare" and "public interest", respectively, as
sufficient standards for a valid delegation of the authority to execute the law. But, the doctrine laid
down in these cases — as all judicial pronouncements — must be construed in relation to the specific
facts and issues involved therein, outside of which they do not constitute precedents and have no
binding effect. 4 The law construed in the Calalang case conferred upon the Director of Public Works,
with the approval of the Secretary of Public Works and Communications, the power to issue rules and
regulations to promote safe transit upon national roads and streets. Upon the other hand, the
Rosenthal case referred to the authority of the Insular Treasurer, under Act No. 2581, to issue and
cancel certificates or permits for the sale of speculative securities. Both cases involved grants
to administrative officers of powers related to the exercise of their administrative functions, calling for
the determination of questions of fact.
Such is not the nature of the powers dealt with in section 68. As above indicated, the
creation of municipalities, is not an administrative function, but one which is essentially and eminently
legislative in character. The question whether or not "public interest" demands the exercise of such
power is not one of fact. It is"purely a legislative question" (Carolina-Virginia Coastal Highway vs.
Coastal Turnpike Authority, 74 S.E. 2d., 310-313, 315-318), or a political question (Udall vs. Severn,
79 P. 2d. 347-349). As the Supreme Court of Wisconsin has aptly characterized it, "the question as to
whether incorporation is for the best interest of the community in any case is emphatically a question
of public policy and statecraft" (In re Village of North Milwaukee, 67 N. W. 1033, 1035-1037).
For this reason, courts of justice have annulled, as constituting undue delegation of
legislative powers, state laws granting the judicial department the power to determine whether certain
territories should be annexed to a particular municipality (Udall vs. Severn, supra, 358-359); or
vesting in a Commission the right to determine the plan and frame of government of proposed villages
and what functions shall be exercised by the same, although the powers and functions of the village
are specifically limited by statute (In re Municipal Charters, 86 Atl. 307-308); or conferring upon courts
the authority to declare a given town or village incorporated, and designate its meter and bounds,
upon petition of a majority of the taxable inhabitants thereof, setting forth the area desired to be
included in such village (Territory ex rel Kelly vs. Stewart, 23 Pac. 405-409); or authorizing the
territory of a town, containing a given area and population, to be incorporated as a town, on certain
steps being taken by the inhabitants thereof and on certain determination by a court and subsequent
vote of the inhabitants in favor thereof, insofar as the court is allowed to determine whether the lands
embraced in the petition "ought justly" to be included in the village, and whether the interest of the
inhabitants will be promoted by such incorporation, and to enlarge and diminish the boundaries of the
proposed village "as justice may require" (In re Villages of North Milwaukee, 67 N.W. 1035-1037); or
creating a Municipal Board of Control which shall determine whether or not the laying out, construction
or operation of a toll road is in the "public interest" and whether the requirements of the law had been
complied with, in which case the Board shall enter an order creating a municipal corporation and fixing
the name of the same (Carolina-Virginia Coastal Highway vs. Coastal Turnpike Authority, 74 S. E. 2d.
310).
 Insofar as the validity of a delegation of power by Congress to the President is concerned,
the case of Schechter Poultry Corporation vs. U. S. (79 L. ed. 1570) is quite relevant to the one at bar.
The Schechter case involved the constitutionality of Section 3 of the National Industrial Recovery Act
authorizing the President of the United States to approve "codes of fair competition" submitted to him
by one or more trade or industrial associations or corporations which "impose no inequitable
restrictions on admission to membership therein and are truly representative," provided that such
codes are not designed "to promote monopolies or to eliminate or oppress small enterprises and will
not operate to discriminate against them, and will tend to effectuate the policy" of said Act. The
Federal Supreme Court held:
"To summarize and conclude upon this point: Sec. 3 of the
Recovery Act is without precedent. It supplies no standards for any trade,
industry or activity. It does not undertake to prescribe rules of conduct to be
applied to particular states of fact determined by appropriate administrative
procedure. Instead of prescribing rules of conduct, it authorizes the making
of codes to prescribe them. For that legislative undertaking, Sec. 3 sets up
no standards, aside from the statement of the general aims of rehabilitation,
correction and expansion described in Sec. 1. In view of the scope of that
broad declaration, and of the nature of the few restrictions that are imposed,
the discretion of the President in approving or prescribing codes, and thus
enacting laws for the government of trade and industry throughout the
country, is virtually unfettered. We think that the code-making authority thus
conferred is an unconstitutional delegation of legislative power."
If the term "unfair competition" is so broad as to vest in the President a discretion that is
"virtually unfettered", and, consequently, tantamount to a delegation of legislative power, it is obvious
that "public welfare", which has even a broader connotation, leads to the same result. In fact, if the
validity of the delegation of powers made in Section 68 were upheld, there would no longer be any
legal impediment to a statutory grant of authority to the President to do anything which, in his opinion,
may be required by public welfare or public interest. Such grant of authority would be a virtual
abdication of the powers of Congress in favor of the Executive, and would bring about a total collapse
of the democratic system established by our Constitution, which it is the special duty and privilege of
this Court to uphold.
It may not be amiss to note that the executive orders in question were issued after the
legislative bills for the creation of the municipalities involved in this case had failed to pass
Congress. A better proof of the fact that the issuance of said executive orders entails the exercise
of purely legislative functions can hardly be given.
Again, Section 10 (1) of Article VII of our fundamental law ordains:
"The President shall have control of all executive departments,
bureaus or offices, exercise general supervision over all local governments
as may be provided by law, and take care that the laws be faithfully
executed."
The power of control under this provision implies the right of the President to interfere in the
exercise of such discretion as may be vested by law in the officers of the executive departments,
bureaus, or offices of the national government, as well as to act in lieu of such officers. This power
is denied by the Constitution to the Executive, insofar as local governments are concerned. With
respect to the latter, the fundamental law permits him to wield no more authority than that of checking
whether said local governments or the officers thereof perform their duties as provided by statutory
enactments. Hence, the President cannot interfere with local governments, so long as the same or its
officers act within the scope of their authority. He may not enact an ordinance which the municipal
council has failed or refused to pass, even if it had thereby violated a duty imposed thereto by law,
although he may see to it that the corresponding provincial officials take appropriate disciplinary
action therefor. Neither may he veto, set aside or annul an ordinance passed by said council within the
scope of its jurisdiction, no matter how patently unwise it may be. He may not even suspend an
elective official of a regular municipality or take any disciplinary action against him, except on appeal
from a decision of the corresponding provincial board. 5
Upon the other hand, if the President could create a municipality, he could, in effect, remove
any of its officials, by creating a new municipality and including therein the barrio in which the official
concerned resides, for his office would thereby become vacant. 6 Thus, by merely brandishing the
power to create a new municipality (if he had it), without actually creating it, he could compel local
officials to submit to his dictation, thereby, in effect, exercising over them the power of control denied
to him by the Constitution.
Then, also, the power of control of the President over executive departments, bureaus or
offices implies no more than the authority to assume directly the functions thereof or to interfere in the
exercise of discretion by its officials. Manifestly, such control does not include the authority either to
abolish an executive department or bureaus, or to create a new one. As a consequence, the alleged
power of the President to create municipal corporations would necessarily connote the exercise by
him of an authority even greater than that of control which he has over the executive departments,
bureaus or offices. In other words, Section 68 of the Revised Administrative Code does not merely fail
to comply with the constitutional mandate above quoted. Instead of giving the President less power
over local governments than that vested in him over the executive departments, bureaus or offices, it
reverses the process and does the exact opposite, by conferring upon him more power over
municipal corporations than that which he has over said executive departments, bureaus or offices.
In short, even if it did not entail an undue delegation of legislative powers, as it certainly
does, said Section 68, as part of the Revised Administrative Code, approved on March 10, 1917, must
be deemed repealed by the subsequent adoption of the Constitution, in 1935, which is utterly
incompatible and inconsistent with said statutory enactment. 7
There are only two (2) other points left for consideration, namely, respondent's claim (a) that
"not all the proper parties" — referring to the officers of the newly created municipalities — "have been
impleaded in this case", and (b) that "the present petition is premature."
As regards the first point, suffice it to say that the records do not show, and the parties do
not claim, that the officers of any of said municipalities have been appointed or elected and assumed
office. At any rate, the Solicitor-General, who has appeared on behalf of respondent Auditor General,
is the officer authorized by law "to act and represent the Government of the Philippines, its offices and
agents, in any official investigation, proceeding or matter requiring the services of a lawyer" (Section
1661, Revised Administrative Code), and, in connection with the creation of the aforementioned
municipalities, which involves a political, not proprietary, function, said local officials, if any, are mere
agents or representatives of the national government. Their interest in the case at bar has,
accordingly, been, in effect, duly represented. 8
With respect to the second point, respondent alleges that he has not as yet acted on any of
the executive order in question and has not intimated how he would act in connection therewith. It is
however, a matter of common, public knowledge, subject to judicial cognizance, that the President
has, for many years, issued executive orders creating municipal corporations and that the same have
been organized and in actual operation, thus indicating, without peradventure of doubt, that the
expenditures incidental thereto have been sanctioned, approved or passed in audit by the General
Auditing Office and its officials. There is no reason to believe, therefore, that respondent would adopt
a different policy as regards the new municipalities involved in this case, in the absence of an
allegation to such effect, and none has been made by him.
 WHEREFORE the Executive Orders in question are hereby declared null and void ab
initio and the respondent permanently restrained from passing in audit any expenditure of public funds
in implementation of said Executive Orders or any disbursement by the municipalities above referred
to. It is so ordered.
Bengzon, C.J., Bautista Angelo, Reyes, J.B.L., Barrera and Dizon, JJ., concur.
Zaldivar, J., took no part.
||| (Pelaez v. Auditor General, G.R. No. L-23825, [December 24, 1965], 122 PHIL 965-989)
 SPECIAL THIRD DIVISION
[G.R. No. 183891. October 19, 2011.]
ROMARICO J. MENDOZA, petitioner, vs. PEOPLE OF THE
PHILIPPINES, respondent.
RESOLUTION
BRION, J p:
We resolve the motion for reconsideration filed by petitioner Romarico J. Mendoza seeking
the reversal of our Decision dated August 3, 2010. The Decisionaffirmed the petitioner's conviction for
his failure to remit the Social Security Service (SSS) contributions of his employees. The petitioner
anchors the present motion on his supposed inclusion within the coverage of Republic Act (RA) No.
9903 or the Social Security Condonation Law of 2009, whose passage the petitioner claims to be
a supervening event in his case. He further invokes the equal protection clause in support of his
motion.
In our Decision dated August 3, 2010, we AFFIRMED, with modification, the decree of
conviction issued by both the trial and appellate courts for the petitioner's violation of Section 22 (a)
and (d), in relation to Section 28 of RA No. 8282 or the Social Security Act of 1997. To recall its
highlights, our Decisionemphasized that the petitioner readily admitted during trial that he did not
remit the SSS premium contributions of his employees at Summa Alta Tierra Industries, Inc. from
August 1998 to July 1999, in the amount of P239,756.80; inclusive of penalties, this unremitted
amount totaled to P421,151.09. The petitioner's explanation for his failure to remit, which the trial court
disbelieved, was that during this period, Summa Alta Tierra Industries, Inc. shut down as a result of
the general decline in the economy. The petitioner pleaded good faith and lack of criminal intent as his
defenses.
We ruled that the decree of conviction was founded on proof beyond reasonable doubt,
based on the following considerations: first, the remittance of employee contributions to the SSS is
mandatory under RA No. 8282; and second, the failure to comply with a special law being malum
prohibitum, the defenses of good faith and lack of criminal intent are immaterial.
The petitioner further argued that since he was designated in the Information as a
"proprietor," he was without criminal liability since "proprietors" are not among the corporate officers
specifically enumerated in Section 28 (f) of RA No. 8282 to be criminally liable for the violation of its
provisions. We rejected this argument based on our ruling in Garcia v. Social Security Commission
Legal and Collection. 1 We ruled that to sustain the petitioner's argument would be to allow the
unscrupulous to conveniently escape liability merely through the creative use of managerial titles.
After taking into account the Indeterminate Penalty Law and Article 315 of the Revised
Penal Code, we MODIFIED the penalty originally imposed by the trial court 2 and, instead, decreed
the penalty of four (4) years and two (2) months of prision correccional, as minimum, to twenty (20)
years of reclusion temporal, as maximum. DIETHS
In the present motion for reconsideration, the petitioner points out that pending his appeal
with the Court of Appeals (CA), he voluntarily paid the SSS the amount of P239,756.80 to settle his
delinquency. 3 Note that the petitioner also gave notice of this payment to the CA via a Motion for
Reconsideration and a Motion for New Trial. Although the People did not contest the fact of voluntary
payment, the CA nevertheless denied the said motions.
The present motion for reconsideration rests on the following points:
First. On January 7, 2010, during the pendency of the petitioner's case before the Court,
then President Gloria Macapagal-Arroyo signed RA No. 9903 into law.RA No. 9903 mandates the
effective withdrawal of all pending cases against employers who would remit their delinquent
contributions to the SSS within a specified period, viz., within six months after the law's
effectivity. 4 The petitioner claims that in view of RA No. 9903 and its implementing rules, the
settlement of his delinquent contributions in 2007 entitles him to an acquittal. He invokes the equal
protection clause in support of his plea.
Second. The petitioner alternatively prays that should the Court find his above argument
wanting, he should still be acquitted since the prosecution failed to prove all the elements of the crime
charged.
Third. The petitioner prays that a fine be imposed, not imprisonment, should he be found
guilty.
The Solicitor General filed a Manifestation in Lieu of Comment and claims that the passage
of RA No. 9903 constituted a supervening event in the petitioner's case that supports the
petitioner's acquittal "[a]fter a conscientious review of the case." 5
THE COURT'S RULING
The petitioner's arguments supporting his prayer for acquittal fail to convince us. However,
we find basis to allow waiver of the petitioner's liability for accrued penalties.
The petitioner's liability for the crime is a settled matter
Upfront, we reject the petitioner's claim that the prosecution failed to prove all the elements
of the crime charged. This is a matter that has been resolved in our Decision, and the petitioner did not
raise anything substantial to merit the reversal of our finding of guilt. To reiterate, the petitioner's
conviction was based on his admission that he failed to remit his employees' contribution to the SSS.
The petitioner cannot benefit from the terms of RA No. 9903, which condone only employers
who pay their delinquencies within six months from the law's effectivity
We note that the petitioner does not ask for the reversal of his conviction based on the
authority of RA No. 9903; he avoids making a straightforward claim because this law plainly does not
apply to him or to others in the same situation. The clear intent of the law is to grant condonation only
to employers with delinquent contributions or pending cases for their delinquencies and who pay their
delinquencies within the six (6)-month period set by the law. Mere payment of unpaid contributions
does not suffice; it is payment within, and only within, the six (6)-month availment period that triggers
the applicability of RA No. 9903.
True, the petitioner's case was pending with us when RA No. 9903 was passed.
Unfortunately for him, he paid his delinquent SSS contributions in 2007. By paying outside of the
availment period, the petitioner effectively placed himself outside the benevolent sphere of RA No.
9903. This is how the law is written: it condones employers — and only those employers — with
unpaid SSS contributions or with pending cases who pay within the six (6)-month period following the
law's date of effectivity. Dura lex, sed lex.
 The petitioner's awareness that RA No. 9903 operates as discussed above is apparent in
his plea for equal protection. In his motion, he states that — caCTHI
[he] is entitled under the equal protection clause to the dismissal of the
case against him since he had already paid the subject delinquent contributions due
to the SSS which accepted the payment as borne by the official receipt it issued
(please see Annex "A"). The equal protection clause requires that similar subjects,
[sic] should not be treated differently, so as to give undue favor to some and unjustly
discriminate against others. The petitioner is no more no less in the same situation
as the employer who would enjoy freedom from criminal prosecution upon payment
in full of the delinquent contributions due and payable to the SSS within six months
from the effectivity of Republic Act No. 9903. 6
The Court cannot amplify the scope of RA No. 9903 on the ground of equal protection, and
acquit the petitioner and other delinquent employers like him; it would in essence be an amendment
of RA No. 9903, an act of judicial legislation abjured by the trias politica principle. 7
RA No. 9903 creates two classifications of employers delinquent in remitting the SSS
contributions of their employees: (1) those delinquent employers who paywithin the six (6)-month
period (the former group), and (2) those delinquent employers who pay outside of this availment
period (the latter group). The creation of these two classes is obvious and unavoidable when Section
2 and the last proviso of Section 4 8 of the law are read together. The same provisions show the law's
intent to limit the benefit of condonation to the former group only; had RA No. 9903 likewise intended
to benefit the latter group, which includes the petitioner, it would have expressly declared so. Laws
granting condonation constitute an act of benevolence on the government's part, similar to tax
amnesty laws; their terms are strictly construed against the applicants. Since the law itself excludes
the class of employers to which the petitioner belongs, no ground exists to justify his acquittal. An
implementing rule or regulation must conform to and be consistent with the provisions of the enabling
statute; it cannot amend the law either by abridging or expanding its scope. 9
For the same reason, we cannot grant the petitioner's prayer to impose a fine in lieu of
imprisonment; neither RA No. 8282 nor RA No. 9903 authorizes the Court to exercise this option.
On the matter of equal protection, we stated in Tolentino v. Board of Accountancy, et
al. 10 that the guarantee simply means "that no person or class of persons shall be denied the same
protection of the laws which is enjoyed by other persons or other classes in the same place and in like
circumstances." In People v. Cayat, 11we further summarized the jurisprudence on equal protection
in this wise:
It is an established principle of constitutional law that the guaranty of the
equal protection of the laws is not violated by a legislation based on reasonable
classification. And the classification, to be reasonable, (1) must rest on substantial
distinctions; (2) must be germane to the purposes of the law; (3) must not be limited
to existing conditions only; and (4) must apply equally to all members of the same
class.
The difference in the dates of payment of delinquent contributions provides a substantial
distinction between the two classes of employers. In limiting the benefits of RA No. 9903 to delinquent
employers who pay within the six (6)-month period, the legislature refused to allow a sweeping,
non-discriminatory condonation to all delinquent employers, lest the policy behind RA No. 8282 be
undermined.
The petitioner is entitled to a waiver of his accrued penalties
Despite our discussion above, the petitioner's move to have our Decision reconsidered is
not entirely futile. The one benefit the petitioner can obtain from RA No. 9903 is the waiver of his
accrued penalties, which remain unpaid in the amount of P181,394.29. This waiver is derived from the
last proviso of Section 4 of RA No. 9903:
Provided, further, That for reason of equity, employers who settled
arrears in contributions before the effectivity of this Act shall likewise have their
accrued penalties waived. AEIcSa
This proviso is applicable to the petitioner who settled his contributions long before the passage of the
law. Applied to the petitioner, therefore, RA No. 9903 only works to allow a waiver of his accrued
penalties, but not the reversal of his conviction.
Referral to the Chief Executive for possible exercise of executive clemency
We realize that with the affirmation of the petitioner's conviction for violation of RA No. 8282,
he stands to suffer imprisonment for four (4) years and two (2) months of prision correccional, as
minimum, to twenty (20) years of reclusion temporal, as maximum, notwithstanding the payment of
his delinquent contribution.
Under Article 5 of the Revised Penal Code, 12 the courts are bound to apply the law as it is
and impose the proper penalty, no matter how harsh it might be. The same provision, however, gives
the Court the discretion to recommend to the President actions it deems appropriate but are beyond
its power when it considers the penalty imposed as excessive. Although the petitioner was convicted
under a special penal law, the Court is not precluded from giving the Revised Penal Codesuppletory
application in light of Article 10 13 of the same Code and our ruling in People v. Simon. 14
WHEREFORE, the Court PARTIALLY GRANTS petitioner Romarico J. Mendoza's motion
for reconsideration. The Court AFFIRMS the petitioner's conviction for violation of Section 22(a) and
(d), in relation to Section 28 of Republic Act No. 8282, and the petitioner is thus sentenced to an
indeterminate prison term of four (4) years and two (2) months of prision correccional, as minimum, to
twenty (20) years of reclusion temporal, as maximum. In light of Section 4 of Republic Act No. 9903,
the petitioner's liability for accrued penalties is considered WAIVED. Considering the circumstances
of the case, the Court transmits the case to the Chief Executive, through the Department of Justice,
and RECOMMENDS the grant of executive clemency to the petitioner.
SO ORDERED.
Peralta, Bersamin, Abad and Villarama, Jr., JJ., concur.
||| (Mendoza v. People, G.R. No. 183891, [October 19, 2011], 675 PHIL 759-770)