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5. RULES OF EVIDENCE

PHILIPPINE MOVE PICTURES WORKERS ASSOCIATION v PREMIER PRODUCTION

Case: Philippine Movie Pictures Workers’ Association v. Premier Productions


Nature: En Banc Decision. G.R. No. L-5621. March 25, 1953.
Ponente: Bautista Angelo

Facts
Premier Productions, alleging that it was suffering financial losses, sought authorization from the Court of
Industrial Relations (CIR) to lay off 44 employees (in two batches: the first . The Philippine Movie Pictures Workers’
Association (PMPWA) opposed this request, contending that the company merely sought to retaliate against the
workers for the strike they had earlier conducted and to harass the labor union.
When the petition was set for hearing, upon request of the counsel of Premier Productions, Presiding Judge
of the CIR, Hon. Arsenio Roldan conducted an ocular inspection of the studios and interrogated 15 laborers who were
then at the premises. On the basis of the evidence gathered during such ocular inspection, Judge Roldan approved
the petition of Premier and authorized the layoff of the workers.
Hence, this Petition for Review.

Issue
W/N the Court of Industrial Relations can authorize the layoff of workers on the basis of a mere ocular
inspection.

Held
It cannot.

Ratio
The Court made mention of how the right to labor is both a constitutional and statutory right which one
cannot be deprived of without due process of law. Thus, while the CIR, in determining questions and controversies,
may adopt its own rules of procedure without much regard for technicalities (meaning that it is not bound by any
technical rules of evidence), it cannot wholly disregard the fundamental requirements of due process. One of the
cardinal primary rights which it must respect is the right to a hearing, wherein one is entitled to present his case and
adduce evidence in support thereof.
As the Court said, an ocular inspection is proper if the court finds it necessary, but it is authorized only to
help the court in clearing a doubt, reaching a conclusion, or finding the truth. It does not take the place of the main
trial; it is conducted only for clarification. In the case at bar, Judge Roldan concluded, based on the ocular inspection,
that the layoff was justified because no more work was left to be done by the laborers in connection with their
assigned jobs. However, the ocular inspection did not settle the more fundamental issue of whether or not the lack of
work was due to financial losses or lack of funds as alleged by Premier, for this required a more intensive scrutiny of
the financial situation of the company. Approving the layoff without settling the said matter worked injustice to the
laborers, according to the Court. Thus, the case was remanded to the court of origin for further proceedings.

- Loraine Mendoza -

ESTATE OF FLORENCIO BUAN V PAMBUSCO


99 PHIL 373
REYES, A.; MAY 31, 1956

FACTS
- The estate of Florencio P. Buan (petitioner), is an authorized bus operator along various lines in central and northern
Luzon, with authority to operate 8 auto-trucks along the Manila-Bagac line and 11 along the Moron Dinalupihan line.
Allegedly in response to various resolutions of municipal councils and on petition of civic and labor groups in the
province of Bataan urging extension of its services to their respective municipalities, petitioner applied in four cases in
the Commission for certificates of public convenience to operate additional trips between Manila and various
municipalities and barrios in Bataan.
- The Pampanga Bus Company (PAMBUSCO) and La Mallorca (respondents) opposed these applications, both
alleging that they are authorized to operate and are actually operating a fleet of auto-trucks on the lines applied for
and rendering adequate and satisfactory service; that the additional services applied for are superfluous, will not
promote public interest in a proper and suitable manner, and will result in cut-throat and ruinous competition.
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- The Commission, after hearing the parties denied the applications on the grounds that petitioner had not made a
case for the grant of the certificates applied for, that the service of the oppositors was adequate and sufficient for the
actual needs of the public and that grant of the applications would only result in unnecessary or wasteful competition.
- To prove the inadequacy of the present service, 14 witnesses took the stand for petitioner and testified to the
insufficiency of transportation facilities and the need for additional service on the lines applied for. Documentary proof,
consisting of resolutions of municipal councils of Balanga, Dinalupihan, Limay, and Orani, and a petition of the
Association of Citizens of Orion, was also adduced to show the need for the solicited additional service, and there
was also mention of the inability of the Pampanga Bus Company to register its authorized number of units, as well as
the alleged noncompliance on the part of the two respondents companies with the terms of their certificates by
suppressing trips on hours when they do not expect a sufficient number of passengers. On their part the two
respondent companies presented six witnesses, and documentary proof too, to show that they were rendering
service in accordance with the requirements of their certificates and that the needs of the traveling public were being
adequately served.
- Unable at first to arrive at a decision from the conflicting evidence presented for both parties, the Commission
ordered a survey of the passenger traffic on the lines applied for. The agents found that existing passenger traffic in
all the lines do not warrant the authorization of additional service.

ISSUE
WON the trips rendered by all the Bus lines are adequate to serve the public need.

HELD
YES. There is no need for additional services.
Ratio The law, in investing the Public Service Commission with the power of supervision and control over public
transportation, has also clothed it with broad discretion in the exercise of that power. With that discretion this Court is
not supposed to interfere except in case of clear abuse.
Reasoning While it is true that the two oppositors have authority to operate direct service only on three of the nine
lines applied for by petitioner, in reality these direct lines pass through the other routes applied for like Orani and
Orion, and the two oppositors have sufficient and convenient trips going to the other destinations, whose hours of
departure and arrival are coordinated with those on the direct trips to Manila.
- The discriminatory attitude imputed to the Commission by reason of its having, to petitioner's prejudice, allegedly
deviated from its consistent policy of approving applications for direct service since such kind of service is more
convenient to the traveling public than the broken trips, is more fancied than real, considering the finding that the
present authorized trips are more than adequate to take care of the passenger traffic along the routes in question.
- The fact that respondents have dispatched trips without previous authority may call for some kind of disciplinary
action. But it would not be a good ground for authorizing additional trips where the Commission has found that there
is already more than adequate service along the main highway.
With regard to Rules of Evidence
- What appears is that the Commission, faced with the conflict of evidence on the adequacy or inadequacy of the
present service, has sought to discover the truth through an on-the-ground inspection and observation by its own
agents and has, on the basis of information thus obtained, arrived at the conclusion that the additional service applied
for is uncalled for because there is already amplitude, if not superabundance, in the number of authorized trips. That
conclusion is amply supported by the record and is far from being the product of partiality or unfair discrimination.
- The findings from the documents and the Commission’s own investigation were supported by more than substantial
evidence and therefore binding upon this Court, which is not required to examine the proof de novo and determine for
itself whether or not the preponderance of evidence really justifies the decision.
DISPOSITION Decision is affirmed, costs against the petitioner.

RIZAL LIGHT & ICE CO., INC. V MUNICIPALITY OF MORONG, RIZAL, PUBLIC SERVICE COMMISSION
24 SCRA 285
ZALDIVAR; September 28, 1968

FACTS
-Rizal Light & Ice Co., Inc. is a domestic corporation with business address at Morong, Rizal. In 1949, it was granted
by the Commission a certificate of public convenience and necessity for the installation, operation and maintenance
of an electric light, heat and power service in the municipality of Morong, Rizal.
-Dec19, 1956: the Commission required Rizal Light to appear before to show cause why it should not be penalized
for violation of the conditions of its certificate of public convenience and the regulations of the Commission, and for
failure to comply with the directives to raise its service voltage and maintain them within the limits prescribed in the
Revised Order No. 1 of the Commission, and to acquire and install a kilowatt meter to indicate the load in kilowatts at
any particular time of the generating unit.
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-Rizal Light failed to appear. The Commission ordered the cancellation and revocation of Rizal Light's certificate of
public convenience and necessity and the forfeiture of its franchise. Rizal Light filed MFR on the ground that its
manager, Juan D. Francisco, was not aware of said hearing. Respondent municipality opposed; motion was set for
hearing and it was found that the failure of Rizal Light to appear at the hearing — the sole basis of the revocation of
Rizal Light's certificate — was really due to the illness of its manager. The Commission set aside its order of
revocation. Respondent municipality’s MFR was denied.
-June 25, 1958: the municipality formally asked the Commission to revoke Rizal Light's certificate of public
convenience and to forfeit its franchise on the ground, among other things, that it failed to comply with the conditions
of said certificate and franchise. Said petition was set for hearing jointly with the order to show cause. The hearings
had been postponed several times.
-Meanwhile, inspections had been made of Rizal Light's electric plant and installations by the engineers of the
Commission. When the case was called for hearing on July 5, 1961, Rizal Light failed to appear. Respondent
municipality was then allowed to present its documentary evidence, and thereafter the case was submitted for
decision.
-July 7, 1961: Rizal Light filed a motion to reopen the case upon the ground that it had not been furnished with a copy
of the report of the June 21-24, 1961 inspection for it to reply as previously agreed. Rizal Light was granted a period
of 10days within which to submit its written reply to said inspection report, on condition that should it fail to do so
within the said period the case would be considered submitted for decision. Rizal Light failed to file the reply. And the
Commission proceeded to decide the case. On July 29, 1962 Rizal Light's electric plant was burned.
-August 20, 1962: the Commission, on the basis of the inspection reports of its aforenamed engineers, found that the
Rizal Light had failed to comply with the directives contained in its letters, and had violated the conditions of its
certificate of public convenience as well as the rules and regulations of the Commission. Accordingly, it ordered the
cancellation and revocation of Rizal Light's certificate of public convenience and the forfeiture of its franchise.
-Sept 18, 1962: Rizal Light filed MFR, alleging that before its electric plant was burned, its service was greatly
improved and that it had still existing investment which the Commission should protect.
-Eight days before said MFR was filed, Morong Electric, having been granted a municipal franchise, filed with the
Commission an application for a certificate of public convenience and necessity for said service. Rizal Light opposed
in writing said application.
-The company also filed MTD the application upon the ground that applicant Morong Electric had no legal personality
when it filed its application, because its certificate of incorporation was at that time, not yet issued by the SEC. this
MTD was denied (Morong Electric was a de facto corporation). Sir says we can omit this corpo law part =)
-The case was heard on the merits and both parties presented their respective evidence. On the basis of the
evidence adduced, the Commission approved the application of Morong Electric and ordered the issuance in its favor
of the corresponding certificate of public convenience and necessity.
-Rizal Light filed with this SC these petitions for review.

ISSUES
1. WON the Commission acted without or in excess of its jurisdiction when it delegated the hearing of the case and
the reception of evidence to Mr. Pedro S. Talavera who is not allowed by law to hear the same
2. WON the cancellation of Rizal Light's certificate of public convenience was unwarranted because no sufficient
evidence was adduced against the Rizal Light and that Rizal Light was not able to present evidence in its defense
3. WON the Commission failed to give protection to Rizal Light's investment
4. WON the Commission erred in imposing the extreme penalty of revocation of the certificate.
NOTE: The other issues are under Corporation Law, which are therefore omitted, as per instructions in the outline.

HELD
A factual determination will not be disturbed by SC unless patently unsupported by evidence. The findings
and conclusions of fact made by the Public Service Commission, after weighing the evidence adduced by the
parties in a public service case, will not be disturbed by the Supreme Court unless those findings and
conclusions appear not to be reasonably supported by evidence.
1. Rizal Light is estopped from raising this as an issue.
Ratio Objection to the delegation of authority to hear a case filed before the Commission and to receive the evidence
in connection therewith is a procedural, not a jurisdictional point, and is waived by failure to interpose timely the
objection and the case had been decided by the Commission.
Reasoning While Mr. Pedro S. Talavera, who conducted the hearings of the case below, is a division chief, he is not
a lawyer. As such, under Section 32 of Commonwealth Act No. 146, as amended, the Commission should not have
delegated to him the authority to conduct the hearings for the reception of evidence of the parties.
-However, since Rizal Light has never raised any objection to the authority of Mr. Talavera before the Commission, it
should be deemed to have waived such procedural defect, and consonant with the precedents on the matter, Rizal
Light's claim that the Commission acted without or in excess of jurisdiction in so authorizing Mr. Talavera should be
dismissed.
2. NO.
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-In reviewing the decision of the Public Service Commission this Court is not required to examine the proof de novo
and determine for itself whether or not the preponderance of evidence really justifies the decision. The only function
of this Court is to determine whether or not there is evidence before the Commission upon which its decision might
reasonably be based. This Court will not substitute its discretion for that of the Commission on questions of fact and
will not interfere in the latter's decision unless it clearly appears that there is no evidence to support it.
-The Commission based its decision on the inspection reports submitted by its engineers who conducted the
inspection of Rizal Light's electric service upon orders of the Commission. Said inspection reports specify in detail the
deficiencies incurred, and violations committed, by the Rizal Light resulting in the inadequacy of its service. Said
reports are sufficient to serve reasonably as bases of the decision in question, for these are not mere documentary
proofs presented for the consideration of the Commission, but are the results of the Commission's own observations
and investigations which it can rightfully take into consideration
-Re: Rizal Light's failure to present evidence, as well as its failure to cross-examine the authors of the inspection
reports… Rizal Light should not complain because it had waived not only its right to cross-examine but also its right to
present evidence in open court through its counsel Atty. Luque.
-Re: Rizal Light's claim that the Commission should have taken into consideration the testimony of Mr. Bernardino…
The Commission could not have taken judicial cognizance of said testimony, for various reasons: first, it is not a
proper subject of judicial notice, as it is not a "known" fact; second, it was given in a subsequent and distinct case
after the Rizal Light's MFR was heard by the Commission en banc and submitted for decision; and third, it was not
brought to the attention of the Commission in this case through an appropriate pleading.
-Re: the contention of Rizal Light that the Commission had acted both as prosecutor and judge… There are two
matters that had to be decided in this case, namely, the order to show cause and the petition or complaint filed by
respondent municipality. Both matters were heard jointly, and the record shows that respondent municipality had
been allowed to present its evidence to substantiate its complaint. It can not be said, therefore, that in this case the
Commission had acted as prosecutor and judge. Even assuming, for the sake of argument, that there was a
commingling of the prosecuting and investigating functions, this exercise of dual functions, is authorized by Sec17(a)
of Commonwealth Act No. 146, as amended.
-Collector of Internal Revenue vs. Estate of F.P. Buan (1958) the power of the Commission to cancel and revoke a
certificate of public convenience and necessity may be exercised by it even without a formal charge filed by any
interested party, with the only limitation that the holder of the certificate should be given his day in court.
-When prosecuting and investigating duties are delegated by statute to an administrative body, as in the case of the
Public Service Commission, said body may take steps it believes appropriate for the proper exercise of said duties,
particularly in the manner of informing itself whether there is probable violation of the law and/or its rules and
regulations. It may initiate an investigation, file a complaint, and then try the charge as preferred. So long as the
respondent is given a day in court, there can be no denial of due process, and objections to said procedure cannot be
sustained.
3. The rule is inapplicable.
-"protection-of-investment rule" - Batangas Transpo Co. vs. Orlanes
-"The Government having taken over the control and supervision of all public utilities, so long as an operator under a
prior license complies with the terms and conditions of his license and reasonable rules and regulations for its
operation and meets the reasonable demands of the public, it is the duty of the commission to protect rather than to
destroy his investment by the granting of the second license to another person for the same thing over the same
route of travel. The granting of such a license does not serve its convenience or promote the interests of the public."
-This rule is not absolute, for nobody has exclusive right to secure a franchise or a certificate of public convenience.
Where, as in the present case, it has been shown by ample evidence that the Rizal Light, despite ample time and
opportunity given to it by the Commission, had failed to render adequate, sufficient and satisfactory service and had
violated the important conditions of its certificate as well as the directives and the rules and regulations of the
Commission, the rule cannot apply.
-To apply that rule unqualifiedly is to encourage violation or disregard of the terms and conditions of the certificate
and the Commission's directives and regulations, and would close the door to other applicants who could establish,
operate and provide adequate, efficient and satisfactory service for the benefit and convenience of the inhabitants. It
should be emphasized that the paramount consideration should always be the public interest and public convenience.
The duty of the Commission to protect the investment of a public utility operator refers only to operators of good
standing - those who comply with the laws, rules and regulations — and not to operators who are unconcerned with
the public interest and whose investments have failed or deteriorated because of their own fault.
4. NO
-Sec16(n) of Commonwealth Act No. 146, as amended, confers upon the Commission ample power and discretion to
order the cancellation and revocation of any certificate of public convenience issued to an operator who has violated,
or has willfully and contumaciously refused to comply with, any order, rule or regulation of the Commission or any
provision of law. What matters is that there is evidence to support the action of the Commission.
-In the instant case, as shown by the evidence, the contumacious refusal of the Rizal Light since 1954 to comply with
the directives, rules and regulations of the Commission, its violation of the conditions of its certificate and its
incapability to comply with its commitment as shown by its inadequate service, were the circumstances that
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warranted the action of the Commission in not merely imposing a fine but in revoking altogether Rizal Light's
certificate. To allow Rizal Light to continue its operation would be to sacrifice public interest and convenience in favor
of private interest.
-The imposition of a fine may only be one of the remedies which the Commission may resort to, in its discretion. But
that remedy is not exclusive of, or has preference over, the other remedies. And this Court will not substitute its
discretion for that of the Commission, as long as there is evidence to support the exercise of that discretion by the
Commission.
Disposition The two decisions of the Public Service Commission affirmed, with costs in the two cases against Rizal
Light & Ice Co., Inc.

BORJA V MORENO, ET AL.


11 SCRA 568
MAKALINTAL; July 31, 1964

FACTS
- Borja is the owner of a parcel of land.
- An administrative complaint was filed against a number of landowners, among them petitioner Borja, for abatement
of nuisance and demolition of illegally constructed dams, dikes or any other works in the public navigable rivers in
Macabebe, pursuant to the provisions of Republic Act No. 2056.
- In the particular case of Borja, he was alleged to have closed the stream called Matlaue, supposedly public, which
runs through his land.
- Benjamin Yonzon, an attorney in the Department of Public Works and Communications, was designated by the
Secretary to investigate the charges in the complaint.
- A copy of the decision, purportedly signed by the Undersecretary, M. B. Bautista, was served upon counsel for Borja
ordering the latter to remove the dams and/or dikes illegally constructed across the channel of the southern portion of
Batacan-Matlaue
- The foregoing decision of respondent Secretary was assailed by petitioner Borja.
- The trial the court rendered the judgment granting the writs prayed for by petitioner; declaring null and void and of
no legal effect all proceedings had by respondents in the administrative investigation, including the decision;
restraining and prohibiting respondent Secretary from enforcing said decision, and declaring the injunction previously
issued to be permanent.

ISSUES
1. WON the lower Court erred in holding in effect that Republic Act No. 2056 is unconstitutional
2. The lower Court erred in not finding the decision of the Secretary of Public Works and Communications supported
by evidence.

HELD
1. NO.
- It is not true that the trial court ruled the foregoing provisions unconstitutional. On the contrary, it declined to pass
upon the constitutional question on the ground that those provisions do not apply to the facts of the instant case.
- The particular fact which removes this case from the purview of RA 2056 and which it considered duly established
by the evidence is that the Matlaue stream which runs through the land of petitioner-appellee is not a public navigable
river but his private property.
- The implication is that the authority of the Secretary of Public Works and Communications to proceed under the
provisions of said statute covers only cases where there is no dispute as to the public navigable character of the river
or waterway alleged to be illegally obstructed, but that when this is precisely a basic fact in contention the matter
should be left to the courts for determination.
- There is a certain danger in leaving the adjudication of a claim of private ownership of property, vis-a-vis the
Government, in the hands of an executive official. This danger is demonstrated by the very argument of appellants
under their third and fourth assignments of error. They point to the evidence submitted at the administrative
investigation and, invoking the "substantial evidence" rule, assail the lower court's conclusion that the Matlaue stream
is privately owned.
- The said rule, indeed, which has been applied in a number of cases in this jurisdiction, is that if there is substantial
evidence to support the findings of an administrative official in matters within his competence, that is, "such relevant
evidence as a reasonable mind might accept as adequate to support a conclusion" the courts are bound to look no
further, not even to consider contrary evidence of a preponderant nature.
- If the decision of the administrative official carries with it, as the premise upon which it rests, a finding that certain
property claimed by a private party to be his is in fact part of the public domain, it does not seem fair to take that
finding as conclusive upon the courts just because it is supported by substantial evidence, although there may be
evidence to the contrary which, if properly considered and evaluated, would lead them to a different conclusion.
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2. YES.
- There is substantial evidence to support the conclusion of respondent Secretary that the Matlaue stream is a public
navigable river. This evidence consists of the testimony of two witnesses, one a farmer and the other a fisherman,
and of the result of the ocular inspection conducted by the investigator.
- Nevertheless, the Court di not feel justified in affirming, for purposes of adjudication, the aforesaid conclusion of
respondent Secretary, and reversing that of the trial court, for the investigation wherein the evidence was received
was conducted with manifest disregard of the requirements of due process. And it was solely on that ground that the
members of this Court agreed that the decision should be predicated.

MACEDA V ENERGY REGULATORY BOARD


199 SCRA 454
EN BANC; July 18, 1991

FACTS
- Maceda seeks nullification of the Energy Regulatory Board Orders dated December 5 and 6, 1990 on the
ground that the hearings conducted on the second provisional increase in oil prices did not allow him substantial
cross-examination, in effect, allegedly, a denial of due process.
- August 2, 1990 – Respondent oil companies filed applications for an increase in oil prices with the ERB.
- In an order dated September 21, 1990 - The ERB issued an order granting a provisional increase of P1.42 per
liter. Maceda filed a petition for Prohibition on September 26, 1990 seeking to nullify the provisional increase.
The petition was dismissed by the SC, saying that “while under Executive Order No. 172, a hearing is
indispensable, it does not preclude the Board from ordering, ex-parte, a provisional increase, as it did here,
subject to its final disposition of whether or not: (1) to make it permanent; (2) to reduce or increase it further; or
(3) to deny the application.”
- In the same order of September 21, 1990, authorizing provisional increase, the ERB set the applications for
hearing with due notice to all interested parties on October 16, 1990. Petitioner Maceda failed to appear at said
hearing as well as on the second hearing an October 17, 1990. The hearing was postponed to October 20 to
afford the oppositors the chance to be heard. Another postponement followed on November 5 because of a
written request by Maceda.
- November 5, 1990 - The three oil companies filed their respective motions for leave to file or admit
amended/supplemental applications to further increase the prices of petroleum products.
- Hearing for the presentation of the evidence-in-chief commenced on November 21, 1990 with ERB ruling that
testimonies of witnesses were to be in the form of Affidavits. ERB subsequently outlined the procedure to be
observed in the reception of evidence as follows: to defer the cross-examination of applicant Caltex's witness
and ask the other applicants to present their evidence-in-chief so that the oppositors will have a better idea of
what all of these will lead to. It was the intention of the Board to act on these applications on an industry-wide
basis and the best way to give the oppositors and a clear picture of what the applicants are asking for is to
have all the evidence-in-chief to the presented first. Cross-examination was to follow afterwards.
- Maceda maintains that this order of proof deprived him of his right to finish his cross-examination of Petron's
witnesses and denied him his right to cross-examine each of the witnesses of Caltex and Shell. He points out
that this relaxed procedure resulted in the denial of due process.

ISSUE
WON the order of presentation of evidence has resulted to denial of due process

HELD
NO
Ratio The order of testimony both with respect to the examination of the particular witness and to the general course
of the trial is within the discretion of the court and the exercise of this discretion in permitting to be introduced out of
the order prescribed by the rules is not improper.
Reasoning
- Such a relaxed procedure is especially true in administrative bodies, such as the ERB, which in matters of rate or
price fixing, is considered as exercising a quasi-legislative, not quasi-judicial, function. As such administrative agency,
it is not bound by the strict or technical rules of evidence governing court proceedings
- Section 2, Rule 1 of the Rules of Practice and Procedure Governing Hearings Before the ERB provides that: “These
Rules shall govern pleadings, practice and procedure before the Energy Regulatory Board in all matters of inquiry,
study, hearing, investigation and/or any other proceedings within the jurisdiction of the Board. However, in the
broader interest of justice, the Board may, in any particular matter, except itself from these rules and apply such
suitable procedure as shall promote the objectives of the Order.”
Disposition Petitions dismissed.
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BANTOLINO V COCA-COLA BOTTLERS PHIL


G.R. No. 153660
BELLOSILLO; JUNE 10 2003

FACTS
-Employees of Coca-Cola Bottlers filed complaint against the company for unfair labor practice through illegal
dismissal, violation of their security of tenure and the perpetuation of the "Cabo System.
-Coca-cola denies that there was ER-EE relationship (said independent contractors were the ERs). Labor Arbiter that
there was and ordered reinstatement and payment of backwages.
-On appeal, the NLRC sustained the finding of the Labor Arbiter that there was indeed an ER-EE relationship
between the complainants and respondent company.
-Coca-Cola Bottlers appealed to the CA which, although affirming the finding of the NLRC that an ER-EE rel existed
bet. the contending parties, nonetheless agreed with respondent that the affidavits of some of the complainants,
Bantolino and 6 others, should not have been given probative value for their failure to affirm the contents thereof and
to undergo cross-examination. As a consequence, the CA dismissed their complaints for lack of sufficient evidence .
(In the same decision, other complainants were declared regular employees since they were the only ones subjected
to cross-examination)
-Petitioners: CA should not have given weight to respondent’s claim of failure to cross-examine them. They insist that,
unlike regular courts, labor cases are decided based merely on the parties’ position papers and affidavits in support of
their allegations and subsequent pleadings that may be filed thereto. The Rules of Court should not be strictly applied
in this case specifically by putting them on the witness stand to be cross-examined because the NLRC has its own
rules of procedure which were applied by the Labor Arbiter in coming up with a decision in their favor.
-Respondent: since the other alleged affiants were not presented in court to affirm their statements, much less to be
cross-examined, their affidavits should be stricken off the records for being self-serving, hearsay and inadmissible in
evidence

ISSUE/S
WON giving evidentiary value to the affidavits (despite the failure of the affiants to affirm their contents and undergo
the test of cross-examination) is proper

HELD
YES
- Rabago v NLRC: "the argument that the affidavit is hearsay because the affiants were not presented for cross-
examination is not persuasive because the rules of evidence are not strictly observed in proceedings before
administrative bodies like the NLRC where decisions may be reached on the basis of position papers only."
-Southern Cotabato Dev. and Construction Co. v. NLRC states: under Art. 221 of the Labor Code, the rules of
evidence prevailing in courts of law do not control proceedings before the Labor Arbiter and the NLRC. The Labor
Arbiter and the NLRC are authorized to adopt reasonable means to ascertain the facts in each case speedily and
objectively and without regard to technicalities of law and procedure, all in the interest of due process.
-Administrative bodies like the NLRC are not bound by the technical niceties of law and procedure and the rules
obtaining in courts of law. The Revised Rules of Court and prevailing jurisprudence may be given only stringent
application, i.e., by analogy or in a suppletory character and effect
-People v. Sorrel (cited by respondent) saying that an affidavit not testified to in a trial, is mere hearsay evidence and
has no real evidentiary value, cannot find relevance in the present case considering that a criminal prosecution
requires a quantum of evidence different from that of an administrative proceeding. Under the Rules of the
Commission, the Labor Arbiter is given the discretion to determine the necessity of a formal trial or hearing. Hence,
trial-type hearings are not even required as the cases may be decided based on verified position papers, with
supporting documents and their affidavits.

CSC V. COLANGCO

Ponente: Corona, J.
Date: April 30, 2008
Nature: Petition for review on certiorari of the decision and resolution of the Court of Appeals

Facts:
In 1992, respondent Tristan Colanggo took the Professional Board Examination for Teachers (PBET) and
obtained a passing rate of 75.98%. A year after, he was appointed Teacher I, and was assigned to Don Ruben Ecleo
Sr. Memorial National High School in Surigao.
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A complaint filed before the Civil Service Commission CARAGA Regional Office questioning the eligibility of
teachers in Surigao del Norte prompted the CSC-CARAGA to investigate the matter. In the course of its investigation,
it discovered significant irregularities in respondent’s documents.
1. The photographs of Colanggo attached to the PBET application form and to the examination seat plan did
not resemble respondent.
2. The signature found in the PBET application form was markedly different from that affixed on respondent’s
personal data sheet.

It appears that three persons were involved in the whole process. Someone other than respondent filed the
application, and still another person took the exam on respondent’s behalf. Hence, the CSC-CARAGA filed a formal
charge for dishonesty and conduct prejudicial to the best interest of service against respondent.
Respondent filed an answer denying the allegations and moved for a formal hearing and investigation. CSC
granted the motion but respondent failed to appear on the scheduled date. He filed for an omnibus motion for the
production of original documents relative to the charges against him and the presentation of persons who supervised
the exam. His motion was granted. Upon examination of evidence, CSC concluded that it wasn’t the respondent who
filed and took the PBET exam. In Resolution No.021412, the CSC found respondent guilty and ordered his dismissal.
Respondent’s motion for reconsideration was denied.
A petition for certiorari was then filed in the CA alleging grave abuse of discretion on the part of CSC, the
same was granted. CA ruled that the photocopies of the PBET application form, picture seat plan and personal data
sheet should have been authenticated. Only documents or public records duly acknowledged or certified as such in
accordance with law could be presented in evidence without further proof. CA annulled CSC’s resolution. Petitioner’s
motion for reconsideration was denied, thus this present petition.

Issue:
1. WON the technical rules on procedure and evidence are applicable in CSC investigation of complaints
against civil servants
2. WON CSC’s non-observance of these technical rules amounted to grave abuse of discretion

Held:
1. Technical rules on procedure and evidence in judicial proceedings are not applicable
2. No grave abuse of discretion on the part of CSC

Ratio:
Administrative rules of procedure are construed liberally to promote their objective and to assist the parties
in obtaining just, speedy and inexpensive determination of their respective claims and defenses. As a general rule, a
finding of guilt in administrative cases, if supported by substantial evidence, will be sustained by the court.
The Uniform Rules on Administrative Cases in the Civil Service (specifically Section 39 thereof) does not
require strict adherence to technical rules of evidence. Thus, it validly considered the photocopies of the PBET
application form, picture seat plan and the personal data sheet in resolving the formal charge against respondent in
spite of the fact that they were not duly authenticated.

- Anne Amantillo -

V. JUDICIAL REVIEW OF ADMINISTRATIVE DECISIONS


A. FACTORS AFFECTING FINALITY OF ADMINISTRATIVE DECISIONS

SWITCHMEN’S UNION OF NORTH AMERICA v NATIONAL MEDIATION BOARD


320 US 297
DOUGLAS; Nov 22, 1943

FACTS:
- Switchmen’s Union of North America brought suit against National Mediation Board, Brotherhood of Railroad
Trainmen, and New York Central Railroad Co and the Michigan Central Railroad Co.
- Pursuant to Sec 2, Ninth of the Railway Labor Act (The Act), the Board was called on to investigate a dispute
among the yardmen of the Railroad Co as to their representative for collective bargaining.
- The Brotherhood sought to be the representative for all the yardmen of the said lines operated by the New York
Central system. The Switchmen contended that yardmen of certain designated parts of the system should be
permitted to vote for separate representatives instead of being compelled to take part in a system-wide election.
- The Board designated all yardmen of the carriers as participants in the election. The election was held and the
Brotherhood was chosen as representative.
ADMINISTRATIVE LAW | Dean Carlota | A2010 Digests (Updated by B2013) | Batch 4 9

- Upon the certification of the result to the carriers, petitioners sought to have the determination by the Board of the
participants in the election and the certification of the representative cancelled.
- District Court upheld Board’s decision to the effect that all yardmen in the service of a carrier should select a single
representative for collective bargaining. Circuit Court of Appeals affirmed.

ISSUE:
WON the District Court erred in taking cognizance of the case

HELD
YES. The District Court did not have the power to review the action of the National Mediation Board in issuing the
certificate.
- Section 24 (8) of the Judicial Code gives the federal district courts “original jurisdiction” of all “suits and proceedings
arising under any law regulating commerce.” But that broad grant of general jurisdiction may not be invoked in face of
special circumstances obtaining in this case.
- The Act in Sec 2, Fourth writes into law the “right” of the “majority of any craft or class of employees” to “determine
who shall be the representative of the craft or class for the purposes of this Act.” That “right” is protected by Sec 2,
Ninth which gives the Mediation Board the power to resolve controversies concerning it and as an incident thereto to
determine what is the appropriate craft or class in which the election should be held. A review by the federal district
courts of the Board’s determination is not necessary to preserve or protect that “right”. It is for Congress to determine
how the rights which it creates shall be enforced. In such a case, the specification of one remedy normally excludes
another.
- Where Congress has not expressly authorized judicial review, the type of problem involved and the history of the
statute in question become highly relevant in determining whether judicial review may be nonetheless supplied.
- Sec 2, Ninth of the Act was introduced as a device to strengthen and make more effective the processes of
collective bargaining. It was drafted so as to give to the Mediation Board the power to “appoint a committee of three
neutral persons who after hearing shall within 10 days designate the employees who may participate in the election.”
That was added so that the Board’s “own usefulness of settling disputes that might arise thereafter might not be
impaired.
- If Congress had desired to implicate the federal judiciary and to place on the federal courts the burden of having
the final say on any aspect of the problem, it would have made its desire plain.
- Congress has long delegated to executive officers or agencies the determination of complicated questions of fact
and of law. And where no judicial review was provided by Congress, the Court has often refused to furnish one even
where questions of law might be involved.
- The function of the Board under Sec 2, Ninth is more the function of a referee. To this decision of the referee
Congress has added a command enforcible by judicial decree. But the “command” is that “of the statute, not of the
Board.”
- Under the Act, Congress did not give the Board discretion to take or withhold action, to grant or deny relief. It gave
it no enforcement functions. It was to find the fact and then cease. Congress prescribed the command. The intent
seems plain – the dispute was to reach its last terminal point when the administrative finding was made. This is
reinforced by the highly selective manner Congress has provided for judicial review of administrative orders or
determinations under the Act. There is no general provision for such review but has expressly provided for it only in
two instances: the National Railroad Adjustment Board (concerning rates of pay, rules, or working conditions), and the
machinery for the voluntary arbitration of labor controversies.
- The language of the Act read in the light of its history supports the view that Congress gave administrative action
under Sec 2, Ninth a finality which it denied administrative action under the other sections.
Disposition Reversed

Reed, dissent
- The problem presented by this case is one of statutory interpretation, whether or not Sec 2, Ninth gives discretion to
the Board to split the crafts of a single carrier into smaller units so that the members of such units may choose
representatives of employees.
- The petitioners may not have an opportunity to impeach or contest an award of a board of arbitration reached after
collective bargaining. There is no opportunity for the petitioners to intervene. As a consequence, petitioners are left
without an opportunity specifically provided by the Act to contest the ruling of the Board of Mediation. The members of
the Switchmen’s Union and the Union itself, in view of the fact that it was the bargaining representative of its
members prior to this controversy, have an interest recognized by law in the selection of representatives. This right
adheres to his condition as an employee as a right of privacy does to a person.

CHEVRON USA v NATURAL RESOURCES DEFENSE COUNCIL, INC


467 US 837
STEVENS; JUNE 25, 1984
ADMINISTRATIVE LAW | Dean Carlota | A2010 Digests (Updated by B2013) | Batch 4 10

FACTS
- Environmental groups filed a petition to review Environmental Protection Agency (EPA) regulations that allow states
to treat all of the pollution-emitting devices within the same industrial grouping as though they were encased within a
single “bubble.” The regulations were promulgated to implement Sec.172 (b)(6) of the Clean Air Act Amendments of
1977, which requires states that have not achieved the national air quality standards established by the EPA to
establish a permit program regulating new or modified major stationary sources of air pollution. Under the regulations,
an existing plant that contains several pollution-emitting devices may install or modify one piece of equipment without
meeting the permit conditions if the alteration will not increase the total emissions from the plant. The US Court of
Appeals for the District of Columbia Circuit set aside the regulations, holding that the bubble concept was
inappropriate in programs enacted to improve air quality.

ISSUE
WON the EPA regulations are valid

HELD
YES.
Reasoning The EPA regulations allowing states to treat all of the pollution-emitting devices within the same industrial
grouping as though they were encased within a single “bubble” were based on a reasonable construction of the term
“stationary source” in Sec.172 (b)(6) of the Clean Air Act Amendments of 1977. Congress did not have a specific
intention on the applicability of the bubble concept and the EPA’s use of that concept was a reasonable policy choice
for the agency to make. The EPA’s interpretation represented a reasonable accommodation of manifestly competing
interests and therefore entitled to deference.
Disposition CA decision REVERSED. EPA regulations held valid.

FORTICH VS CORONA
289 SCRA 624
MARTINEZ; April 24, 1998

FACTS
- This case involves a 144-hectare land located at San Vicente, Sumilao, Bukidnon, owned by the Norberto
Quisumbing, Sr. Management and Development Corporation (NQSRMDC), one of the petitioners.
- In 1984, the land was leased as a pineapple plantation to the Philippine Packing Corporation, now Del Monte
Philippines, Inc. (DMPI), a multinational corporation, for a period of 10 years under the Crop Producer and Grower's
Agreement. The lease expired in April, 1994.
- In October 1991, during the existence of the lease, the DAR placed the entire 144-hectare property under
compulsory acquisition and assessed the land value at P2.38 million.
- NQSRMDC resisted the DAR's action. In February, 1992, it sought and was granted by the DARAB a writ of
prohibition with preliminary injunction which ordered the DAR Region X Director, the Provincial Agrarian Reform
Officer (PARO) of Bukidnon, the Municipal Agrarian Reform Office (MARO) of Sumilao, Bukidnon, and Land Bank to
desist from pursuing any activity or activities concerning the subject land until further orders.
- Despite the DARAB order, the DAR Regional Director issued a memorandum directing the Land Bank to open a
trust account for P2.38 million in the name of NQSRMDC and to conduct summary proceedings to determine the just
compensation of the subject property. NQSRMDC objected to these moves
- The DARAB (a) ordered the DAR Regional Director and Land Bank "to seriously comply with the terms of the order"
(b) nullified the DAR Regional Director's memo and the summary proceedings conducted pursuant thereto; and (c)
directed the Land Bank "to return the claim folder of NQSRMDC's subject Property to the DAR until further orders."
- The Land Bank complied with the DARAB order
- In the meantime, the Provincial Development Council (PDC) of Bukidnon, headed by Governor Carlos O. Fortich,
passed Resolution No. 6 designating certain areas along Bukidnon-Sayre Highway as part of the Bukidnon Agro-
Industrial Zones where the subject property is situated.
- What happened thereafter was:
Pursuant to Section 20 of the Local Government Code, the Sangguniang Bayan of Sumilao, Bukidnon, on March 4,
1993, enacted Ordinance No. 24 converting or re-classifying 144 hectares of land in Bgy. San Vicente from
agricultural to industrial/institutional with a view of providing an opportunity to attract investors who can inject new
economic vitality, provide more jobs and raise the income of its people.
Parenthetically, under said section, 4th to 5th class municipalities may authorize the classification of five percent (5%)
of their agricultural land area and provide for the manner of their utilization or disposition.
On 12 October 1993, the Bukidnon Provincial Land Use Committee approved the said Ordinance. Accordingly, on 11
December 1993, the instant application for conversion was filed by Mr. Gaudencio Beduya in behalf of
NQSRMDC/BAIDA (Bukidnon Agro-Industrial Development Association).
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The Bukidnon Provincial Board, on the basis of a Joint Committee Report, approved the said Ordinance (now
Resolution No. 94-95).
The said industrial area, as conceived by NQSRMDC is supposed to have the following components:
1. Development Academy of Mindanao which covers an area of 24 hectares;
2. Bukidnon Agro-Industrial Park needing about 67 hectares;
3. Forest development to cover 33 hectares; and
4. Support facilities which comprise the construction of a 360-room hotel, restaurants, dormitories and a housing
project covering an area of 20 hectares.
The said NQSRMDC Proposal was adopted by the DTI, Bukidnon Provincial Office, as one of its flagship projects.
Notwithstanding the foregoing favorable recommendation, however, on November 14, 1994, the DAR, thru Secretary
Garilao, invoking its powers to approve conversion of lands under Section 65 of R.A. No. 6657, issued an Order
denying the instant application for the conversion of the subject land from agricultural to agro-industrial and, instead,
placed the same under the compulsory coverage of CARP and directed the distribution thereof to all qualified
beneficiaries on the following grounds:
1. The area is considered as a prime agricultural land with irrigation facility;
2. The land has long been covered by a Notice of Compulsory Acquisition (NCA);
3. The existing policy on withdrawal or lifting on areas covered by NCA is not applicable;
4. There is no clear and tangible compensation package arrangements for the beneficiaries;
- Thus, the DAR Secretary ordered the DAR Regional Director "to proceed with the compulsory acquisition and
distribution of the property."
- Gov. Fortich appealed" the order of denial to the Office of the President and prayed for the
conversion/reclassification of the subject land as the same would be more beneficial to the people of Bukidnon.
- To prevent the enforcement of the DAR Secretary's order, NQSRMDC filed with the CA a petition for certiorari,
prohibition with preliminary injunction
- Meanwhile, on July 25, 1995, Dominguez, then Presidential Assistant for Mindanao sent a memo to the President
favorably endorsing the project. Also, in a memo to the President, Rafael Alunan III, then Secretary of the DILG,
recommended the conversion of the subject land to industrial/institutional use.
- CA issued a Resolution ordering the parties to observe status quo pending resolution of the petition.
- In resolving the appeal, the Office of the President issued a Decision reversing the DAR Secretary's decision, saying
that converting the land in would open great opportunities for employment and real development in the area. That the
land is considered a prime agricultural land with irrigation facility, the decision said that the same is not irrigated. On
the issue that the land has long been covered by a Notice of Compulsory Acquisition (NCA), the said NCA was
declared null and void by the DARAB as early as March 1, 1992. Deciding in favor of NQSRMDC, the DARAB
correctly pointed out that the subject property could not validly be the subject of compulsory acquisition until after the
expiration of the lease contract with Del Monte Philippines, or until April 1994, and ordered the DAR Regional Office
and the Land Bank of the Philippines to desist from pursuing any activity or activities covering petitioner's land.
Neither can the assertion that there is no clear and tangible compensation package arrangements for the
beneficiaries' hold water as, in the first place, there are no beneficiaries to speak about, for the land is not tenanted
as already stated.
- DAR filed a motion for reconsideration of the OP decision.
- in compliance with the OP decision, NQSRMDC and DECS executed a MOA whereby the former donated 4
hectares from the subject land to DECS for the establishment of the NQSR High School. When NQSRMDC was
about to transfer the title to DECS, it discovered that the title over the subject property was no longer in its name. It
soon found out that during the pendency of the actions it filed against DAR in the CA and the appeal to the President
filed by Fortich, the DAR, without giving just compensation, caused the cancellation of NQSRMDC's title and had it
transferred in the name of the Republic of the Philippines. Thereafter, DAR caused the issuance of Certificates of
Land Ownership Award and had it registered in the name of 137 farmer-beneficiaries.
- Thus, on April 10, 1997, NQSRMDC filed a complaint with the RTC for annulment and cancellation of title, damages
and injunction against DAR and 141 others. The RTC then issued a TRO and a Writ of Preliminary Injunction
- Meanwhile, an Order was issued by Exec. Sec. Torres denying DAR's MFR for having been filed beyond the
reglementary period of 15 days. The said order further declared that the OP decision had already become final and
executory.
- On October 1997, some alleged farmer-beneficiaries began their hunger strike in front of the DAR Compound to
protest the OP Decision. Others filed a motion for intervention asking that the OP Decision allowing the conversion of
the entire 144-hectare property be set aside.
- President FVR then held a dialogue with the strikers and promised to resolve their grievance. He created an 8-man
Fact Finding Task Force (FFTF) to look into the controversy and recommend possible solutions to the problem.
- the OP resolved the strikers' protest by issuing the so-called "Win/Win" Resolution penned by then Deputy
Executive Secretary Renato C. Corona: modified the approval of the land conversion to agro-industrial area only to
the extent of 44 hectares, and ordered the remaining 100 hectares to be distributed to qualified farmer-beneficiaries
- Bukidnon officials and NQSRMDC filed the present petition for certiorari, prohibition and injunction with urgent
prayer for a temporary restraining order and/or writ of preliminary injunction.
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ISSUES
1. WON the recourse of petitioners is proper.
2. WON the petitioners committed a fatal procedural lapse when they failed to file a MFR of the assailed resolution
before seeking judicial recourse.
3. WON the filing by the petitioners of: (a) a petition for certiorari, prohibition with preliminary injunction with the Court
of Appeals; (b) a complaint for annulment and cancellation of title, damages and injunction against DAR and 141
others with the RTC; and (c) the present petition, constitute forum shopping.
4. WON the motion for intervention filed by alleged farmer-beneficiaries must be approved.
5. WON the final and executory Decision dated March 29, 1996 can still be substantially modified by the "Win-Win"
Resolution.

HELD
1. YES.
Ratio It is true that under Rule 43, appeals from awards, judgments, final orders or resolutions of any quasi-judicial
agency exercising quasi-judicial functions, including the OP, may be taken to the CA by filing a verified petition for
review within 15 days from notice of the said judgment, final order or resolution, whether the appeal involves
questions of fact, of law, or mixed questions of fact and law. However, we hold that, in this particular case, the remedy
prescribed in Rule 43 is inapplicable considering that the present petition contains an allegation that the challenged
resolution is "patently illegal" and was issued with "grave abuse of discretion" and "beyond his Corona's jurisdiction"
when said resolution substantially modified the earlier OP Decision which had long become final and executory. In
other words, the crucial issue raised here involves an error of jurisdiction, not an error of judgment which is
reviewable by an appeal under Rule 43. Thus, the appropriate remedy to annul and set aside the assailed resolution
is an original special civil action for certiorari under Rule 65.
2. NO.
The said motion is not necessary when the questioned resolution is a patent nullity.
3. NO.
Ratio There is forum-shopping whenever, as a result of an adverse opinion in one forum, a party seeks a favorable
opinion (other than by appeal or certiorari) in another. The test for determining whether a party violated the rule
against forum shopping is, forum shopping exists where the elements of litis pendentia are present or where a final
judgment in one case will amount to res judicata in the other.
Reasoning A cursory examination of the cases filed by the petitioners does not show that the said cases are similar
with each other. The petition for certiorari in the Court of Appeals sought the nullification of the DAR Secretary's order
to proceed with the compulsory acquisition and distribution of the subject property. On the other hand, the civil case in
RTC was based on the following grounds: (1) the DAR, in applying for cancellation of petitioner NQSRMDC's title,
used documents which were earlier declared null and void by the DARAB; (2) the cancellation of NQSRMDC's title
was made without payment of just compensation; and (3) without notice to NQSRMDC for the surrender of its title.
The present petition is entirely different from the said two cases as it seeks the nullification of the assailed "Win-Win"
Resolution of the OP, which resolution was issued long after the previous two cases were instituted.
4. NO.
The movants are those purportedly "Found Qualified and Recommended for Approval." In other words, movants are
merely recommendee farmer-beneficiaries. The rule in this jurisdiction is that a real party in interest is a party who
would be benefited or injured by the judgment or is the party entitled to the avails of the suit. Real interest means a
present substantial interest, as distinguished from a mere expectancy or a future, contingent, subordinate or
consequential interest. Undoubtedly, movants' interest over the land in question is a mere expectancy.
5. NO.
Ratio The rules and regulations governing appeals to the Office of the President of the Philippines are embodied in
Administrative Order No. 18. Sec. 7 thereof provides:
Sec. 7. Decisions/resolutions/orders of the Office of the President shall, except as otherwise provided for by special
laws, become final after the lapse of 15 days from receipt of a copy thereof by the parties, unless a motion for
reconsideration thereof is filed within such period. Only one motion for reconsideration by any one party shall be
allowed and entertained, save in exceptionally meritorious cases.
It is further provided for in Section 9 that the Rules of Court shall apply in a suppletory character whenever
practicable.
- When the OP issued the Order declaring the earlier Decision final and executory, as no one has seasonably filed a
motion for reconsideration thereto, the said Office had lost its jurisdiction to re-open the case, more so modify its
Decision. Having lost its jurisdiction, the Office of the President has no more authority to entertain the second motion
for reconsideration filed by respondent DAR Secretary, which second motion became the basis of the assailed "Win-
Win" Resolution. Sec.7 of AO 18 and Sec.4 Rule 43 mandate that only 1 motion for reconsideration is allowed to be
taken from the Decision of March 29, 1996. And even if a second MFR was permitted to be filed in "exceptionally
meritorious cases," still the said motion should not have been entertained considering that the first MFR was not
seasonably filed, thereby allowing the Decision of March 29, 1996 to lapse into finality. Thus, the act of the OP in re-
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opening the case and substantially modifying its March Decision which had already become final and executory, was
in gross disregard of the rules and basic legal precept that accord finality to administrative determinations.
Disposition the present petition is hereby GRANTED.

ANTIQUE SAWMILL INC VS ZAYCO


GR No. 20051
REGALA; May 30, 1966

NATURE
Appeal from the decision of the Court of first Instance of Manila

FACTS
- A public bidding was conducted for the award of a 12680-hectare forest area. Those who submitted bid applications
with the Bureau of Forestry are as follows: the petitioner-appellant, Antique Sawmills, Inc., the respondent-appellee,
Aquiles Zayco, Crisencio Milendez and Pedro T. Lo. The Director of Forestry awarded the bid to the respondent-
appellee, Aquiles R. Zayco. Thereafter, the losing bidders appealed the above award to the Secretary of Agriculture
and Natural Resources who, on March 23, 1955, however, affirmed the same.
- All the losing bidders filed a motion for reconsideration with the Secretary of Agricultural and Natural Resources and
acting on this motion, the said Secretary issued an order on July 14, 1955 modifying the original exclusive award to
Aquiles R. Zayco. Under this July 14, 1955 order, the forest area in question was awarded in equal portions to Aquiles
R. Zayco and the petitioner-appellant, Antique Sawmills, Inc. Zayco received a copy of the above-mentioned order on
July 28, 1955, and on August 20, 1955, he filed against it a motion for reconsideration. On September 10, 1955, this
motion for reconsideration was denied. Zayco received a copy of this order on November 27, 1955.
- On December 19, 1955, Zayco filed with the Secretary of Agriculture and Natural Resources a second motion for
reconsideration. The latter held that the second motion for reconsideration was filed too late because All in all, fifty
(50) days had elapsed from his receipt of the order sought to be reconsidered to the filing of the herein motion.
Consequently, the said order of this office dated July 14, 1955 had already become final and executory pursuant to
the aforecited regulation (*From the time the movant received notice of the order sought to be reconsidered on July
28, 1955, to the time he filed his first motion for reconsideration on August 20, 1955, twenty-three (23) days had
elapsed; and from his receipt of the order of this Office dated September 10, 1955, denying the first motion for
reconsideration on November 22, 1955, to the filing of the instant motion on December 19, 1955, twenty-seven (27)
days had elapsed.)
- On August 27, 1956, however, the Executive Secretary rendered a decision sustaining the appeal and reversing the
order of the Secretary of Agriculture and Natural Resources dated July 14, 1955. This order of the Executive
Secretary awarded the entire forest concession in question to the respondent-appellee, Aquiles B. Zayco.
(*reasoning: It appears, however, in the affidavit of the appellant and in the records of this case that he was not duly
represented by counsel in the main stages of the proceedings, and that he was not aware of the reglementary period
within which to take the various steps to protect his rights. Moreover, there was no advertence on notice by that
Department upon the herein appellant that he had to exercise his rights within certain fixed periods.)

ISSUE
WON the Office of the President still retains or possesses jurisdiction to review on appeal a decision of the Secretary
of Agriculture and Natural Resources which has become final.

HELD
NO
- In a long line of cases, 1 the Supreme Court has ruled that compliance with the period provided by law for the
perfection of an appeal is not merely mandatory but also a jurisdictional requirement ( Miranda vs. Guanzon) Such
failure has the effect of rendering final the judgment of the court, and the certification of the record on appeal
thereafter cannot restore the jurisdiction which has been lost. The dismissal of the appeal can be effected even after
the case has been elevated to the Court of Appeals (Rule 52, Section 1[a]). Appellee's failure to file a motion for
dismissal of appeal in the court of origin before the transmittal of the record to the appellate court, does not constitute
a waiver on his part to interpose such objection
- That administrative rules and regulations have the force of law can no longer be questioned. Only recently, in the
case of Valerio vs. Secretary of Agriculture, The Court held that “it cannot be contended, as the court a quo
intimated, that an administrative regulation should not be given the same weight as to rule of court but should rather
be given a more liberal interpretation for, as is well known, a regulation adopted pursuant to law has the force and
effect of law. In fact it is a wise policy that administrative regulations be given the same force as rules of court in order
to maintain the regularity of administrative proceedings.
- The appellees' view that the period fixed in Administrative Order No. 6-2 of the Director of Forestry cannot bind the
Office of the President since the latter has supervision and control over the former cannot commend itself to sound
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public policy. Even administrative decisions must and sometime, as fully as public policy demands that finality be
written on judicial controversies In other words, public interest requires that proceedings already terminated should
not be altered at every step. The rule of non quieta movere prescribes that what was already terminated should not
be disturbed (Espiritu vs. San Miguel Brewery).

VICENTE SOTTO vs. JUAN RUIZ


G.R. No. 17419
MALCOLM, J. (1921 March 18)

NATURE
Petition for mandamus.

FACTS
- SOTTO is the proprietor of the periodical The Independent, while RUIZ is the Acting Director of the Bureau of Posts.
Copies of the January 29, 1921 issue of Independent were set for distribution through the mails. RUIZ, however,
refused such distribution on the ground that the publication contained libelous matter. RUIZ was referring to the
printed message on a postal card consisting of the telegram from one official in Cebu to another in Manila. Hence the
petition.

ISSUE
Whether or not RUIZ is justified in refusing the distribution of the subject periodical.

HELD
NO.
- The Administrative Code declares that no printed matter of libelous character shall be carried by the mails of the
Philippines, or be delivered to its addressee by any employee of the Bureau of Posts. On the other hand, whether an
article is libelous is fundamentally a legal question. In order for there to be due process of law, the action of
the Director of Posts must be subject to revision by the courts in case he has abused his discretion or
exceeded his authority.
- The duty of determining whether a publication contains printed matter of a libelous character rests with the Director
and involves the exercise of his judgment and discretion. The rule is that courts will not interfere with the decision
of the Director of Posts unless clearly of opinion that it was wrong.
- The propriety of a periodical distributing copies of a confidential telegram sent by one official to another may well be
questioned. But to do so is not libelous per se. Even the squib following the copy of the telegram is no more than
attempted humor and would not be taken seriously by the reading public.
Disposition We reach the conclusion that the action of the Director was wrong. An order shall issue to RUIZ,
directing him to receive, to carry, and to deliver, the package containing the January 29, 1921 copies of Independent.

UY v PALOMAR
GRN L-23248
ZALDIVAR; February 28, 1969]

FACTS
- Postmaster General issued Fraud Order No. 3, dated November 22, 1963, declaring Manuel Uy Sweepstakes
Agency as conducting a lottery or gift enterprise and directing all postmasters and other employees of the Bureau of
Post concerned to return to the sender any mail matter addressed to Manuel Uy Sweepstakes Agency or to any of its
agents or representatives with the notation "Fraudulent" stamped upon the cover of such mail matter, and prohibiting
the issuance or payment of any money order or telegraphic transfer to the said agency or to any of its agents and
representatives.
- This fraud order is in connection to a "Grand Christmas Bonus Award" plan. The plan was designed to boost the
sales of tickets for the PCSO Grand Christmas Sweepstakes Draw. According to said plan, the appellee's sub-agents
and purchasers of whole sweepstakes tickets sold by appellee and his sub-agents may, in addition to the regular
prize money of the December 15, 1963 draw, win bonuses and awards.
- Uy advertised his "Grand Christmas Bonus Award" plan in the metropolitan newspapers of nationwide circulation,
the first of such advertisements appearing in seven such newspapers in their issues of November 18, 1963. The
newspaper advertisements were repeated almost every week after November 18, 1963, with the last of them
published in the issue of the "Daily Mirror" of December 7, 1963. The fraud order in question was issued by the
Postmaster-General under date of November 22, 1963. However, it was only on December 10, 1963 Uy came to
know of the issuance and context thereof when he sought clarification from the Manila Post Office why his parcels
ADMINISTRATIVE LAW | Dean Carlota | A2010 Digests (Updated by B2013) | Batch 4 15

containing sweepstakes tickets for his sub-agents, as well as his other mail matters of purely personal nature, were
refused acceptance for mailing the day previous.
- The Postmaster General claims that he had made his decision based upon satisfactory evidence that the "Grand
Christmas Bonus Award" plan of appellee is a lottery or gift enterprise for the distribution of gifts by chance, and his
decision in this regard cannot be reviewed by the court.

ISSUE
WON the court can review the Postmaster General’s decision

HELD
Yes.
- The Postal Law contains no provision for judicial review of the decision of the Postmaster General. This Court,
however, in Reyes vs. Topacio had stated that the action of the Director of Posts (now Postmaster General) is subject
to revision by the courts in case he exceeded his authority or his act is palpably wrong. And in "El Debate" Inc. vs.
Topacio, this Court said that the courts will not interfere with the decision of the Director of Posts (Postmaster
General) as to what is, and what is not, mailable matter unless clearly of opinion that it was wrong. In other words, the
courts will interfere with the decision of the Postmaster General if it clearly appears that the decision is wrong. This
Court, by said rulings, recognizes the availability of judicial review over the action of the Postmaster General,
notwithstanding the absence of statutory provision for judicial review of his action. It may not be amiss to state that
said rulings are in consonance with American jurisprudence to the effect that the absence of statutory provisions for
judicial review does not necessarily mean that access to the courts is barred. The silence of the Congress is not to be
construed as indicating a legislative intent to preclude judicial review. In American School of Magnetic Healing vs.
McAnnulty, the U.S. Supreme Court, speaking on the power of the courts to review the action of the Postmaster
General under a statute similar to our Postal Law, said:
"That the conduct of the post office is a part of the administrative department of the government is entirely true, but
that does not necessarily and always oust the courts of jurisdiction to grant relief to a party aggrieved by any action
by the head, or one of the subordinate officials, of that Department, which is unauthorized by the statute under which
he assumes to act. The acts of all its officers must be justified by some law, and in case an official violates the law to
the injury of an individual the courts generally have jurisdiction to grant relief."

MANUEL v VILLENA, THE DIRECTOR OF FORESTRY


37 SCRA 745
MAKALINTAL, J : February 27, 1971

FACTS
This is an appeal from the order of the Court of First Instance of Tarlac dismissing the complaint in Civil Case No.
4226 entitled "Magno Manuel vs. Mariano Villena, the Director of Forestry and the Secretary of Agriculture and
Natural Resources," wherein the plaintiff sought annulment of the decision of said public officials rejecting his
application for a Tree Farm Permit over a 20-hectare parcel of public land, which was included in a 66-hectare area
covered by a similar application of private defendant Mariano Villena.
- The main thrust of the complaint is that the administrative decision sought to be set aside violated the plaintiff's right
to due process. The averments in support thereof are substantially as follows: that the plaintiff had been in continuous
possession of the land in question since 1939; that being an ignorant farmer he did not file his Tree Farm application
(No. 13312) until June 1954; that the Director of Forestry rejected the same because a prior application (No. 3852)
had been filed by Mariano Villena in November 1955; that two motions for reconsideration of the rejection order were
turned down; that the plaintiff thereafter appealed to the Secretary of Agriculture and Natural Resources, but the
appeal was dismissed by him; that on motion for reconsideration the Secretary found that the previous investigation
conducted by the District Forester was not in accordance with the rules and regulations of the Bureau, and so
ordered another investigation to be made; but that before said investigation was terminted the Secretary rendered a
decision dismissing the appeal.
- On December 6, 1966 the court issued an order finding the defendants' objection meritorious, but allowing the
plaintiff to file an amended complaint within a period of ten days.
- On March 21, 1967 defendant Villena moved to dismiss the amended complaint on the ground that it did not cure
the defects of the original one, and still contained sufficient allegations to make out a cause of action or to confer
jurisdiction upon the court to set aside or annul the administrative decision complained of. The court found the motion
meritorious and hence dismissed the complaint in its order of June 24, 1967. The said order of dismissal is the
subject of the present appeal.

ISSUE
WON the decision of the Director of Public Forestry should be annulled.
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HELD
No.
- Courts, as a rule, refuse to interfere with proceedings undertaken by administrative bodies or officials in the exercise
of administrative functions. This is so because such bodies are generally better equipped technically to decide
administrative questions and that non-legal factors, such as government policy on the matter, are usually involved in
the decisions.
- The proceedings challenged in the complaint refer to the approval or rejection of an application for a Tree Farm
Permit. Under Section 1838 of the Revised Administrative Code, this function falls within the jurisdiction of the
Director of Forestry with the approval of the Secretary of Agriculture and Natural Resources.
The power thus conferred on the Director of Forestry with the approval of the Secretary of Agriculture and Natural
Resources is basically executive or administrative in nature. And courts, as a rule, refuse to interfere with
proceedings undertaken by administrative bodies or officials in the exercise of administrative functions. This is so
because such bodies are generally better equipped technically to decide administrative questions and that non-legal
factors, such as government policy on the matter, are usually involved in the decisions.
There are, of course, limits to the exercise of administrative discretion. Administrative proceedings may be reviewed
by the courts upon a showing that "the board or official has gone beyond his statutory authority, exercised
unconstitutional powers or clearly acted arbitrarily and without regard to his duty or with grave abuse of discretion" or
that the decision is vitiated by fraud, imposition or mistake.
The complaint here alleges denial of due process and grave abuse of discretion, in that appellant was not formally
represented by counsel at any stage of the proceedings before the Director of Forestry and the Secretary of
Agriculture and Natural Resources; that there was no showing that notice was sent to him so as to afford him an
opportunity to obtain the services of a lawyer; and that the Secretary dismissed the appeal before the completion of
the reinvestigation he had ordered.
The above circumstances however do not necessarily constitute a violation of due process or grave abuse of
discretion. Section 1838 of the Revised Administrative Code does not require that the investigation be in the nature of
a court trial. In deciding administrative questions, administrative bodies or officials generally enjoy wide discretion.
Technical rules of procedure are not strictly enforced, and due process of law in the strict judicial sense is not
indispensable. 4 It is sufficient that the substantive due process requirement of fairness and reasonableness be
observed.

SAN MIGUEL CORP V LABOR SEC, NLRC, YANGLAY


64 SCRA 56
AQUINO; May 16, 1975

FACTS
- this is a labor case regarding the dismissal of Yanglay from San Miguel Corp (SMC) for allegedly trafficking drugs
(medicines) to his fellow employees (apparently, SMC gave its employees some medicines to keep then healthy.
What Yanglay did was buy the rations of his fellow employees after the company has distributed the same)
- the case was submitted to the NLRC. Mediator-fact-finder Cruz issued recommendation that Yanglay be reinstated
(although it admitted that SMC did not commit ULP). The NLRC adopted this recommendation. Thus, SMC filed this
certiorari. Yanglay then contests the jurisdiction of the SC to over the case, alleging that SC cannot review decisions
of NLRC and Sec. of Labor under the principle of separation of powers and that judicial review is not provided for in
PD21.

ISSUE
WON SC had jurisdiction over the petition for certiorari

HELD
YES
Ratio It is generally understood that as to administrative agencies exercising quasi-judicial or legislative power there
is an underlying power in the courts to scrutinize the acts of such agencies on questions of law and jurisdiction even
though no right of review is given by statute
Reasoning The purpose of judicial review is to keep the administrative agency within its jurisdiction and protect
substantial rights of parties affected by its decisions
- It is part of the system of checks and balances which restricts the separation of powers and forestalls arbitrary and
unjust adjudications.
- Judicial review is proper in case of lack of jurisdiction, grave abuse of discretion, error of law, fraud or collusion
(Timbancaya vs. Vicente; Macatangay vs. Secretary of Public Works and Communications; Ortua vs. Singson
Encarnacion).
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- The courts may declare an action or resolution of an administrative authority to be illegal (1) because it violates or
fails to comply with some mandatory provision of the law or (2) because it is corrupt, arbitrary or capricious
(Borromeo vs. City of Manila and Rodriguez Lanuza; Villegas vs. Auditor General).
- WRT to the labor case, SC declared the dismissal to be a too drastic punishment for the drug trafficking (it held that
buying of the drugs (given by SMC in gratis) of other employees should not have been done, but the act merely was a
“misconduct”  term used by SC). Only disciplinary action should have been imposed.
Disposition Petition denied. Reinstated WITHOUT backwages

UCPB V E. GUANZON, INC

Title: UNITED COCONUT PLANTERS BANK, JERONIMO U. KILAYKO, LORENZO V. TAN, ENRIQUE L. GANA,
JAIME W. JACINTO and EMILY R. LAZARO, petitioners, vs. E. GANZON, INC., Respondent.

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

G.R. No. 168897


E. GANZON, INC., petitioner, vs. UNITED COCONUT PLANTERS BANK, JAIME W. JACINTO and EMILY R.
LAZARO, Respondents.

Date: June 30, 2009


Ponente: Chico-Nazario, J.
Nature: Two consolidated Petitions for Review on Certiorari under Rule 45
Facts:
 E. Ganzon Inc (EGI) availed itself of credit facilities from UCPB to finance its business expansion.
 To secure said credit facilities, EGI mortgaged to UCPB its condominium unit inventories in EGI Rufino Plaza.
 When the negative effects of the Asian economic crisis caught up with the corporation, EGI started defaulting in
its payment of amortizations making all of its obligations due and demandable.
 EGI was declared in default by UCPB in its letters, thereafter, UCPB stopped sending EGI monthly statements of
its accounts.
 The outstanding loan obligations of EGI with UCPB amounted to P915,838,822.50, inclusive of all interest,
charges and fees.
 EGI and UCPB explored the possibility of using the mortgaged condominium unit inventories of EGI in EGI
Rufino Plaza as payment for the loans of EGI to UCPB. Upon agreeing on the valuation of said mortgaged
properties, EGI and UCPB entered into a Memorandum of Agreement.
 EGI and UCPB executed an Amendment of Agreement to reflect the true and correct valuation of the properties
of EGI listed in the MOA that would be transferred to UCPB in settlement of the total loan obligations of the
former with the latter. The properties of EGI to be used in paying for its debt with UCPB were valued at
P904,491,052.00.
 UCPB proceeded to foreclose some of the properties of EGI listed in the MOA.
 The foreclosure proceeds of said properties amounted only to P723,592,000.00, less than the value of the
properties of EGI stipulated in its amended MOA with UCPB.
 There was still an unpaid balance of P192,246,822.50.
 Some of the other properties of EGI at EGI Rufino Plaza, valued at P166,127,369.50, were transferred by way of
dacion en pago to UCPB.
 during the signing of the transaction papers for the dacion en pago, EGI Senior Vice-President, noticed that said
papers stated that the remaining loan balance of EGI in the amount of P192,246,822.50 had increased to
P226,963,905.50.
 EGI President and Senior Vice-President reviewed their files to verify the figures on the loan obligations of EGI
as computed by UCPB.
 In the process, they discovered the UCPB Internal Memorandum dated 22 February 2001, which presented two
conflicting columns, one with the heading "ACTUAL" and the other "DISCLOSED TO EGI."
 "DISCLOSED TO EGI" = P226,967,194.80, "ACTUAL" = P146,849,412.58.
 UCPB explained that the "ACTUAL" column contained the same amounts reflected or recorded in its financial
statements, in accordance with the Manual of Accounts for Banks, Manual of Regulations for Banks and BSP
Circular No. 202,16 Series of 1999. In contrast, the "DISCLOSED TO EGI" column showed the total amount still
due from EGI, including the total principal, interests, transaction and other costs after the foreclosure, whether
reflected in the financial books of UCPB or not.
 Further, UCPB maintained that the difference in the figures in the two columns was because BSP Circular No.
202 and Section X305.4 of the Manual of Regulations for Bank disallowed banks from accruing in its books
interest on loans which had become non-performing.
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 EGI filed with the BSP an administrative complaint against UCPB, et al., for violation of Sections 36 1 and 37,2
Article IV of Republic Act No. 7653,3 in relation to Section 55.1(a)4 of Republic Act No. 87915; and for the
commission of irregularities and conducting business in an unsafe or unsound manner.
 BSP Monetary Board dismissed the administrative complaint of EGI based on the evaluation conducted by the
Supervision and Examination Department I and the Office of the General Counsel and Legal Services.
 BSP Monetary Board denied MFR of EGI
 Court of Appeals set aside the aforesaid letter-decision of the BSP Monetary Board and remanded the case to
the latter for further proceedings. CA also denied MFR of UCPB and partial MFR of EGI.

Issues:
1. W/N CA has appellate jurisdiction over decisions of BSP/Monetary Board? (Civpro topic) YES
2. W/N the bangko sentral summarily dismissed the complaint of EGI? YES
` 3. W/N CA erred in disregarding the findings of fact of the bangko sentral? NO

Held:
1. CA has appellate jurisdiction over BSP/Monetary Board’s Decisions. Section 9(3) of Batas Pambansa Blg.
129, as amended, and Section 1, Rule 43 of the 1997 Revised Rules of Civil Procedure reveals that the BSP
Monetary Board is not included among the quasi-judicial agencies explicitly named therein, whose final judgments,
orders, resolutions or awards are appealable to the Court of Appeals. Such omission, however, does not necessarily
mean that the Court of Appeals has no appellate jurisdiction over the judgments, orders, resolutions or awards of the
BSP Monetary Board.
However, Section 9(3) of Batas Pambansa Blg. 129, as amended, on the appellate jurisdiction of the Court
of Appeals, generally refers to quasi-judicial agencies, instrumentalities, boards, or commissions. The use of the word
"including" in the said provision, prior to the naming of several quasi-judicial agencies, necessarily conveys the very
idea of non-exclusivity of the enumeration. The principle of expressio unius est exclusio alterius does not apply where
other circumstances indicate that the enumeration was not intended to be exclusive, or where the enumeration is by
way of example only,
Similarly, Section 1, Rule 43 of the 1997 Revised Rules of Civil Procedure merely mentions several quasi-
judicial agencies without exclusivity in its phraseology. The enumeration of the agencies therein mentioned is not
exclusive. The introductory phrase "[a]mong these agencies are" preceding the enumeration of specific quasi-judicial
agencies only highlights the fact that the list is not meant to be exclusive or conclusive. Further, the overture stresses
and acknowledges the existence of other quasi-judicial agencies not included in the enumeration but should be
deemed included.
BSP Monetary Board is a quasi-judicial agency exercising quasi-judicial powers or functions. It is an
independent central monetary authority and a body corporate with fiscal and administrative autonomy, mandated to

1
Section 36. Proceedings Upon Violation of This Act and Other Banking Laws, Rules, Regulations, Orders or Instructions. —
Whenever a bank or quasi-bank, or whenever any person or entity willfully violates this Act or other pertinent banking laws being
enforced or implemented by the Bangko Sentral or any order, instruction, rule or regulation issued by the Monetary Board, the
person or persons responsible for such violation shall unless otherwise provided in this Act be punished by a fine of not less than
Fifty thousand pesos (P50,000) nor more than Two hundred thousand pesos (P200,000) or by imprisonment of not less than two (2)
years nor more than ten (10) years, or both, at the discretion of the court.

Whenever a bank or quasi-bank persists in carrying on its business in an unlawful or unsafe manner, the Board may, without
prejudice to the penalties provided in the preceding paragraph of this section and the administrative sanctions provided in Section
37 of this Act, take action under Section 30 of this Act.
2

Section 37. Administrative Sanctions on Banks and Quasi-banks. — Without prejudice to the criminal sanctions against the culpable
persons provided in Sections 34, 35, and 36 of this Act, the Monetary Board may, at its discretion, impose upon any bank or quasi-
bank, their directors and/or officers, for any willful violation of its charter or by-laws, willful delay in the submission of reports or
publications thereof as required by law, rules and regulations; any refusal to permit examination into the affairs of the institution; any
willful making of a false or misleading statement to the Board or the appropriate supervising and examining department or its
examiners; any willful failure or refusal to comply with, or violation of, any banking law or any order, instruction or regulation issued
by the Monetary Board, or any order, instruction or ruling by the Governor; or any commission of irregularities, and/or conducting
business in an unsafe or unsound manner as may be determined by the Monetary Board, the following administrative sanctions,
whenever applicable:
3

Known as "The New Central Bank Act."


4

Section 55. Prohibited Transactions. —


55.1. No director, officer, employee, or agent of any bank shall —
(a) Make false entries in any bank report or statement or participate in any fraudulent transaction, thereby affecting the financial
interest of, or causing damage to, the bank or any person;
5

Otherwise known as "The General Banking Law of 2000."


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provide policy directions in the areas of money, banking and credit. Section 37 of the New Central Bank Act in
particular, explicitly provides that the BSP Monetary Board shall exercise its discretion in determining whether
administrative sanctions should be imposed on banks and quasi-banks, which necessarily implies that the BSP
Monetary Board must conduct some form of investigation or hearing regarding the same.
BSP Monetary Board is indeed a quasi-judicial body exercising quasi-judicial functions; then as such, it is
one of those quasi-judicial agencies, though not specifically mentioned in Section 9(3) of Batas Pambansa Blg. 129,
as amended, and Section 1, Rule 43 of the 1997 Revised Rules of Civil Procedure, are deemed included therein.
Therefore, the Court of Appeals has appellate jurisdiction over final judgments, orders, resolutions or awards of the
BSP Monetary Board on administrative complaints against banks and quasi-banks, which the former acquires
through the filing by the aggrieved party of a Petition for Review under Rule 43 of the 1997 Revised Rules of Civil
Procedure.

2. Yes, BSP Monetary Board did summarily dismiss administrative complaint of EGI against UCPB. the
sweeping statement of the BSP Monetary Board that it was inclined to dismiss the complaint of EGI based on the
evaluation made by its Supervision and Examination Department I and Office of the General Counsel and Legal
Services, is simply insufficient and unsatisfactory. Worse, the BSP Monetary Board merely presented the following
conclusions without bothering to explain its bases for the same:
a) UCPB computed interest on loans based on BSP rules and regulations which prohibit banks from accruing
interest on loans that have become non-performing (BSP Circular No. 202);
b) fair market value of assets to be foreclosed is different from the bid price submitted during foreclosure and
there is no statutory obligation for the latter to be equivalent to the former;
c) regarding the alleged P145,163,000.00 fabricated loan, the documents showed that there were the EGI
Board resolution to borrow, promissory note signed by Mr. Eulalio Ganzon, and Loan Agreement stating the
proceeds shall be used to pay outstanding availments and interest servicing; and
d) there is no finding by Supervision and Examination Department I on the alleged double charging and/or
padding of transaction costs.
In resolving the matter before it, the BSP Monetary Board never considered the UCPB Internal
Memorandum, which was the heart of the administrative complaint of EGI against UCPB. BSP Monetary Board did
not even attempt to establish whether it was regular or sound practice for a bank to keep a record of its borrower’s
loan obligations with two different sets of figures, one higher than the other; and to disclose to the borrower only the
higher figures. The explanation of UCPB gives rise to more questions than answers.
BSP Monetary Board similarly failed to clarify whether UCPB can foreclose the mortgaged properties of EGI
in amounts that were less than the values of the said properties as determined and stipulated by EGI and UCPB in
their amended MOA.
BSP Monetary Board found that the P145,163,000.00 loan of EGI from UCPB was not fabricated based on
several documents. However, there is absolute lack of explanation by the BSP Monetary Board as to why said
documents deserved more weight vis-à-vis evidence of EGI of suspicious circumstances surrounding the said loan.
The disregard by BSP Monetary Board of all the foregoing facts and issues in its letter-decision leads this
Court to declare that it summarily dismissed the administrative complaint of EGI against UCPB.

3. No, CA did not err in the third issue.


Although, as a general rule, findings of facts of an administrative agency, which has acquired expertise in the
particular field of its endeavor, are accorded great weight on appeal, such rule cannot be applied with respect to the
assailed findings of the BSP Monetary Board in this case. Rather, what applies is the recognized exception that if
such findings are not supported by substantial evidence, the Court can make its own independent evaluation of the
facts.
Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a
conclusion.
While rules of evidence prevailing in courts of law and equity shall not be controlling, the obvious purpose
being to free administrative boards from the compulsion of technical rules so that the mere admission of matter which
would be deemed incompetent in judicial proceedings would not invalidate the administrative order, this assurance of
a desirable flexibility in administrative procedure does not go so far as to justify orders without basis in evidence
having rational probative force.
It cannot be convincingly said herein that the factual findings of the BSP Monetary Board in its letter-decision
was supported by substantial evidence since (1) most of the findings were not supported by references to specific
evidence; and (2) the findings were made without consideration of the primary evidence presented by EGI (i.e., the
MOA and its amendments and the UCPB Internal Memorandum dated 22 February 2001).

There was no finding yet as to the merit of the complaint that is why the case was remanded to BSP board for their
expertise. The Court only ruled that 1. CA has appellate jurisdiction over decisions of BSP/Monetary board and 2.
That the BSP Monetary board should not have dismissed the charges filed by EGI against UCPB
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- Cyril Arnesto -

B. EXHAUSTION OF ADMINISTRATIVE REMEDIES

PASCUAL V PROVINCIAL BOARD OF NUEVA ECIJA


106 PHIL 446
GUTIERREZ DAVID; October 31, 1959

FACTS
- October 6, 1956 > Acting Provincial Governor of Nueva Ecija filed with the Provincial Board three administrative
charges against Arturo B. Pascual, elected mayor of San Jose, Nueva Ecija, in November 1951 and reelected in
1955, for [CHARGE NO. 3] "Maladministrative, Abuse of Authority, and Usurpation of Judicial Functions," committed
by willfully, feloniously, criminally, without legal authority, and with grave abuse of authority, assumed and usurped the
judicial powers of the justice of the peace by accepting the criminal complaint filed in the said court, conducting the
preliminary investigation thereof, fixing the bail bond of P6,000.00, and issuing the corresponding warrant of arrest;
and after the accused in the said criminal case had been arrested, while the justice of the peace was in his office in
San Jose, Nueva Ecija, Pascual, in defiance of the express refusal by the justice of the peace to reduce the bail bond
of the accused, acted on the motion to reduce bail and did reduce the bail bond to P3,000.00,
- Pascual filed with the Provincial Board a motion to dismiss CHARGE NO. 3 above referred to, on the ground that
the wrongful acts alleged had been committed during his previous term of office and could not constitute a ground for
disciplining him during his second term. Motion to dismiss was denied by resolution of the Board.
- Pascual filed with SC a petition for a writ of prohibition with preliminary injunction to enjoin the Provincial Board of
Nueva Ecija from taking cognizance of CHARGE NO. 3, but the petition was denied by minute resolution "without
prejudice to action, if any, in the CFI."
- Accordingly, Pascual filed with CFI Nueva Ecija a petition for prohibition with preliminary injunction seeking to inhibit
the said Provincial Board from proceeding with the hearing of CHARGE NO. 3, for lack of jurisdiction.
- Provincial Board moved for the dismissal of the case on the ground that it states no cause of action because the
Pascual had not complied with the cardinal principle of exhaustion of administrative remedies before he could appeal
to the courts, and because the Provincial Board had jurisdiction over CHARGE NO. 3.
- CFI issued an order dismissing the petition "for being premature," for the reason that the Pascual had not first
appealed to the Executive Secretary. From that order, the case was brought before us on appeal.

ISSUES
1. WON it was legally proper for Pascual to have come to court without first bringing his case to the Executive
Secretary for review
2. WON disciplining an elective municipal official for a wrongful act he committed during his immediately preceding
term of office is valid

HELD
1. YES
Doctrine Where the law has delineated the procedure by which administrative appeal or remedy could be effected,
the same should be followed before recourse to judicial action can be initiated (Ang Tuan Kai vs. Import Control
Commission etc).
Ratio The rule will be relaxed where there is grave doubt as to availability of the administrative remedy; where the
question in dispute is purely a legal one, and nothing of an administrative nature is to be or can be done ; where
although there are steps to be taken, they are, under the admitted facts, merely matters of from, and the
administrative process, as a process of judgment, is over; or where the administrative remedy is not exclusive but
merely cumulative or concurrent to a judicial remedy. A litigant need not proceed with optional administrative process
before seeking juducial relief.
Reasoning
- Mondano vs. Silvosa > granted a writ of prohibition against the provincial board of Capiz, notwithstanding the fact
that he did not appeal to the Executive Secretary, the only question involved being WON the charged filed against the
municipal mayor of Calibo, Capiz, constituted any one of the grounds for suspension or removal provided for in sec.
2188 of the Revised Administrative Code.
2. NO
Ratio The underlying theory is that each term is separate from other terms, and that the reelection to office operates
as a condonation of the officer's previous misconduct to the extent of cutting off the right to remove him therefor.
Reasoning
- SC resorted to American authorities. The weight of authorities, however, seems to incline to the rule denying the
right to remove one from office because of misconduct during a prior term, to which we fully subscribe.
Offenses committed, or acts done, during previous term are generally held not to furnish cause for removal and
this is especially true where the constitution provides that the penalty in proceedings for removal shall not extend
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beyond the removal from office, and disqualification from holding office for the term for which the officer was
elected or appointed.
- The Court should never remove a public officer for acts done prior to his present term of office. To do otherwise
would be to deprive the people of their right to elect their officers. When the people have elected a man to office, it
must be assumed that they did this with knowledge of his life and character, and that they disregarded or forgave his
faults or misconduct, if he had been guilty of any. It is not for the court, by reason of such faults or misconduct to
practically overrule the will of the people.

ALZATE v ALDANA
107 Phil 298
Barrera, J.; Feb 29, 1960

NATURE
Appeal from an order of La Union CFI

FACTS
- RA No. 842 was enacted to adjust the salaries of Public school teachers and personnel. Under the law salary
adjustment of 4 grades was to be effected for every five years of service plus another grade for passing the
examination for Superintendent of Private school given by the Civil Service Commission.
- Anacleto Alzate, Principal of a High School in La Union, has been in service for 24 years, the last one as secondary
principal. His salary was adjusted based only on his number of years of service as secondary principal ( 9 years, 8
months, 15 days) and his having passed the test as earlier mentioned was not considered. He appealed this but even
before the ruling from the Bureau of Public School, he filed a mandamus proceeding in the CFI of La Union fearing
that the amount appropriated for the payment of the salary adjustment of public schools teachers and officials, if not
disbursed or committed before the expiration of the fiscal year on June 30, 1958, would be reverted to the general
funds of the Government.
- Thereafter, respondents filed their motion to dismiss on the grounds that the petition stated no cause of action
against respondents; that petitioner had not exhausted all administrative remedies before coming to court, and that
the lower court had acquired no jurisdiction over the case. Accordingly, the petition was dismissed without prejudice
to the right of the petitioner to file an appropriate action at the opportune time.
-Hence this appeal to the SC

ISSUE/S
WON the CFI as correct in dismissing the case for non exhaustion of administrative remedies

HELD
No. There is merit in petitioner's contention. The fact that the parties had to agree and the court had to approve the
agreement that the Director of Public Schools shall recommend to the proper officials not later than June 30, 1958
and before the closing of office hours on that date the commitment of the sum of P840.00 claimed by petitioner, to
accounts payable in order to prevent its reversion, is a recognition by the parties as well as the court of the validity
and urgency of the action taken by the petitioner-appellant. It would seem, therefore, that in the particular
circumstances of the present case, petitioner had sufficient cause of action at the time of the filing of his
petition on June 11, 1958, and a resort to the court without awaiting for the final decision of the
administrative officers is not, in view of the special situation, premature.
- . It appears from the petition that the reason for its filing without awaiting the final action on the part of the
respondent Director of Public Schools was the urgency of preventing the automatic reversion as of July 1, 1958, after
the expiration of the then current fiscal year, of the sum appropriated in Republic Act No. 2042 for the adjustment of
salary of public school officials and teachers pursuant to Republic Act No. 842. Petitioner contends that if he waited
for the final decision on his petition for reconsideration which was not forthcoming, and in fact did not come, before
June 30, 1958, whatever action may thereafter be taken by respondent, even if favorable to petitioner, would be of no
avail after the reversion of the funds appropriated for the purpose of salary adjustment. Hence, he claims, that to
require him to exhaust the administrative remedies would, in the circumstances of the case, in effect amount to a
nullification of his claim.
Disposition Petition is granted.

CIPRIANO v. MARCELINO
43 SCRA 291
CASTRO, February 28, 1972

FACTS
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- Cipriano served as record clerk in the office of municipal treasurer Gregorio P. Marcelino of Calabanga, Camarines
Sur. On the latter date she resigned. Because the respondent municipal treasurer, upon her severance from the
service, refused to pay her salary for a certain period, as well as the commutation equivalent of her accumulated
vacation and sick leaves.
- Cipriano filed an action for mandamus to compel the said municipal treasurer to pay her the total amount of P949.
She also asked for moral and exemplary damages, attorney's fees and costs of suit.
- Marcelino moved to dismiss upon the ground that she had not "exhausted all administrative remedies before filing
the present action," arguing that exhaustion of all administrative remedies is a condition precedent before an
aggrieved party may have judicial recourse. Granting the motion, the court a quo ordered the dismissal of the case.
Cipriano's motion for reconsideration was denied.

ISSUE
WON Cipriano did not exhaust all administrative remedies before filing the present action.

HELD
- NO. The principle of exhaustion of administrative remedies is not without exception, not is it a condition precedent to
judicial relief. The principle may be disregarded when it does not provide a plain, speedy and adequate remedy. It
may and should be relaxed when its application may cause great and irreparable damage.
- It is altogether too obvious that to require the petitioner Cipriano to go all the way to the President of the Philippines
on appeal in the matter of the collection of the small total of nine hundred forty-nine (P949) pesos, would not only be
oppressive but would be patently unreasonable. By the time her appeal shall have been decided by the President, the
amount of much more than P949, which is the total sum of her claim, would in all likelihood have been spent.
- The theory that a party must first exhaust his remedies in the administrative branch before seeking the aid of the
strong arm of equity must give way to the reality that a government employee must depend for the support of himself
and his family upon his salary, and were he to be deprived of that even alone for a few months, possibly even lees,
that must mean starvation because more often than not, a government employee lives hand-to-mouth existence and
he awaits with eager hands the arrival of the forthnightly envelope because upon it must hinge the supply of rice and
fish and clothing of his spouse and children and himself and with it only can be maintained, and therefore were the
dogmatic rule of exhaustion of administrative remedies be made to mean that he should wait for the most final
administrative decision in his case, the only logical result must be vital disaster to his dependents and to himself, so
that this is the reason why the rule of exhaustion of administrative remedies has always been understood to mean
that the same have furnished a plain, speedy and adequate remedy.
- All the documents required to support payment of Cipriano's salary and the cash commutation of her unused
vacation and sick leaves have been accomplished. Cipriano having thus earned the right to the said payment, it has
become the corresponding duty of the respondent treasurer to recognize such right and effect payment.
Disposition petition is granted. The municipal treasurer of the Municipality of Calabanga, Camarines Sur, is ordered
to pay to petitioner, without further delay, the total sum of P949.

CORPUS VS CUADERNO
G.R. No. L-17860
DE LEON ; March 30, 1962

FACTS
- Corpus held the position of Special Assistant to the Governor of the Central Bank of the Philippines a position
declared by the President of the Philippines as "highly technical in nature and placed in the exempt class.
- He was charged in an administrative case, for alleged dishonesty, incompetence, neglect of duty and/or abuse of
authority, oppression, misconduct, etc. preferred against him by employees of the Bank. This resulted in his
suspension by the Monetary Board and the creation of a 3-man committee to investigate him. The committee was
composed of representatives of the Bank, Bureau of Civil Service and the Office of the City Fiscal of Manila. The
committee submitted a Final Report which finds that there was no basis upon which to recommend disciplinary action
against Corpus. The report recommends that he immediately be reinstated.
- The MB did not agree with the committee report and adopted Res’n. No 957 which considered "the respondent, R.
Marino Corpus, resigned as of the date of his suspension as his continuance of service would be prejudicial to the
best interest of the bank.
- Corpus filed a petition for certiorari, mandamus and quo warranto, with preliminary mandatory injunction and
damages
- Filemon Mendoza, a central bank employee filed a petition for intervention. Together with the other respondents,
they filed a motion to dismiss. The motion to dismiss was granted based on the ground that Corpus was not able to
exhaust all administrative remedies.
- The lower court was of the opinion that Corpus should have exhausted all administrative remedies
available to him, such as an appeal to the Commissioner of Civil Service, under Republic Act No. 2260, or the
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President of the Philippines who under the Constitution and the law is the head of all the executive
departments of the government including its agencies and instrumentalities.

ISSUE
WON Corpus should have exhausted all administrative remedies available to him such as an appeal to the
Commissioner of Civil Service or the President of the Philippines

HELD
NO.
- There is no law requiring an appeal to the President in a case like the one at bar. The fact that the President had, in
two instances cited in the orders appealed from, acted on appeals from decisions of the Monetary Board of the
Central Bank, should not be regarded as precedents, but at most may be viewed as acts of condescension on the
part of the Chief Executive.
- While there are provisions in the Civil Service Law regarding appeals to the Commissioner of Civil Service and the
Civil Service Board of Appeals, We believe the petitioner is not bound to observe them, considering his status and the
Charter of the Central Bank. In Castillo vs. Bayona, et al., we said that Section 14, Republic Act 265, creating the
Central Bank of the Philippines, particularly paragraph (c) thereof, "is sufficiently broad to vest the Monetary Board
with the power of investigation and removal of its officials, except the Governor thereof. In other words, the Civil
Service Law is the general legal provision for the investigation, suspension or removal of civil service employees,
whereas Section 14 is a special provision of law which must govern the investigation, suspension or removal of
employees of the Central Bank, though they may be subject to the Civil Service Law and Regulations in other
respects."
- In this case, the respondent Monetary Board considered petitioner resigned from the office to which he has been
legally appointed as of the date of his suspension, after he has been duly indicted and tried before a committee
created by the Board for the purpose. An appeal to the Civil Service Commission would thereby be an act of
supererogation, requiring the presentation of practically the same witnesses and documents produced in the
investigation conducted at the instance of the Monetary Board. Moreover, considering again the fact that the Charter
of the Central Bank provides for its own power, through the Monetary Board, relative to the investigation, suspension
or removal of its own employees except the Governor, coupled with the fact that petitioner has admitted that he
belongs to the non-competitive or unclassified service, it is evident that an appeal by petitioner to the Commissioner
of Civil Service is not required or at most is permissive and voluntary.

DE LARA v CLORIVEL

VICENTE DE LARA, JR., ET AL., petitioners, vs. GAUDENCIO CLORIBEL, ET AL., respondents. (1965)

Facts: Vicente de Lara, Jr. was granted on August 5, 1957 a timber license to log over an area in Claveria, Misamis
Oriental, for which he was authorized to cut annually cubic meters of timber. Although De Lara failed to undertake any
operation in the area covered by his license, he was, however, able to secure its renewal from year to year up to
1961. His latest renewal for 1962 was rejected by the Bureau of Forestry.

- During De Lara's period of non-renewal of his timber license, P&B Enterprises Co.’s application for a similar forest
concession was approved. The company introduced substantial improvements thereon consisting of logging roads
within the forest area of approximately 7 kilometers in length which extended not only along the plaintiff's concession
but partially within the area covered by the De Lara’s timber concession in 1961.

- In the meantime, De Lara's petition for renewal of his license for 1963 was approved, which, as amended, included
a portion of the forest concession area originally granted to P & B. Hence, the latter protested against such approval
insofar as the portion of the area in conflict is concerned but the protest was overruled. Consequently, the company
appealed the Director of Forestry's decision to the Secretary of Agriculture and Natural Resources, but until
now the appeal remains pending study and consideration by said official.

- Still, De Lara was able to continue his logging operation even if he trespassed upon and used the road constructed
by the company in the transportation of his logs cut within the contested area. The protest finally came to the
attention of the Director of the Bureau of Forestry, who prohibited De Lara from using the logging road, but the same
was later countermanded thus prompting the company to appeal to the Secretary of Agriculture and Natural
Resources, who on June 7, 1963 issued an order prohibiting De Lara from entering and operating within the
contested area until after the conflict existing between the two loggers shall have been finally decided.

- However, De Lara still continued to his operation to the great damage and prejudice of the company. Hence P&B
filed before the Court of First Instance of Manila a complaint for injunction and damages against Vicente de Lara, Jr.
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and the Bureau of Forestry. CFI issued ex parte the writ of preliminary injunction prayed for enjoining Vicente
De Lara and his aids from cutting, hauling, shipping, and exporting logs from the forest area covered by the
timber license issued in plaintiff's favor.

- De Lara filed a motion to dismiss as well as to dissolve the injunction alleging, among other grounds, that the
P&B has failed to exhaust all its administrative remedies in that it filed said complaint before the appeal taken
from the order of the Director of Forestry allowing De Lara to use the logging road constructed within the contested
forest area could be finally acted upon by the Secretary of Agricultural and Natural Resources, thereby implying that
such action was premature. But the same was denied. Hence De Lara filed a petition for certiorari with a request
for the issuance of a writ of preliminary injunction in order to maintain the status quo of the logging operations of
the parties prior to the institution of the instant case. SC issued the injunction prayed for.

- Respondents argue: injunction issued by the CFI was necessary to prevent bodily injury and violence to the
employees of respondent company in view of De Lara's threat to appropriate and utilize the private logging road
constructed P&B through the use of force and political influence and in open defiance of an order of the Secretary of
Agriculture and Natural Resources not to do so until the conflict existing between the two loggers shall have been
finally decided. They pray that the petition be dismissed and the writ issued by the SC dissolved.

Issue: Has respondent court committed a grave abuse of discretion in issuing ex parte the writ of preliminary
injunction prayed for by respondent company? [No, it did not]

Held/Ratio: While as a rule of petition for certiorari which is interposed to dispute the validity of an order or decision
that may be rendered by an administrative official in pursuance of the powers and duties with which he is invested
cannot be entertained if the party in interest fails to avail of the administrative remedies officials are the most
competent to pass upon matters that exclusively come within their jurisdiction, such rule may be relaxed when
its application may cause great and irreparable damage which cannot otherwise be prevented except by
taking the opportune appropriate court action. Stated otherwise, the rule is inapplicable if it should appear
that an irreparable damage and injury will be suffered by a party if he should await, before taking court
action, the final action of the administrative official concerned on the matter. This is the situation herein
obtained. Because of the conflict existing between petitioner and respondent company regarding a portion of the
logging area awarded to them, as well as the use of the logging road constructed by the company, the case was
taken to the Secretary of Agriculture and Natural Resources for his final resolution; but before such resolution could
come, De Lara disregarded the directive and continued operating within the contested area to the irreparable damage
and injury of the company. This act of defiance prompted the company to take the needed appropriate action.
In the circumstances, we find the action taken by respondent court proper and justified even if no final decision has
as yet been rendered by the Secretary of Agriculture and Natural Resources.

- Lala Badi -

PAREDES vs. CA (NAVARRO)


253 SCRA 126
KAPUNAN; Feb 11, 1996

FACTS
- Public respondents promulgated Administrative Order Nos. 1 and 2, Series of 1992, revising the rules of practice
before the Bureau of Patents, Trademarks and Technology Transfer (BPTTT) in patent and trademark cases, to take
effect on 15 March 1993. Among the provisions of said administrative orders are Rule 16 of A.O. No. 1 and Rule 15 of
A.O. No. 2, which increased the fees payable to the BPTTT for registration of patents and trademarks and Rule 59 of
A.O. No. 2 which prohibited the filing of multi-class applications, that is, one application covering several classes of
goods.
- Petitioners, who are registered patent agents, filed with the Court of Appeals a Petition for Prohibition with prayer
for the issuance of a Writ of Preliminary Injunction to stop public respondents from enforcing the aforementioned
administrative orders 2 and to declare Rule 16 of A.O. No. 1 and Rules 15 and 59 of A.O. No. 2, series of 1992 of the
BPTTT null and void.
- CA dismissed the petition for prohibition and denied the motion for reconsideration filed by petitioners. Thus, this
petition.

ISSUES
1. WON the CA erred in dismissing the petition on the ground of non-exhaustion of administrative remedies.
2. WON the CA erred in not holding that the questioned administrative orders are null and void for failure to comply
with the publicationrequirements of both the Administrative Code and BP 325
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3. WON the CA erred in not declaring null and void Rule 59 of Administrative Order No. 1 on the ground that the
public respondents do not have the power to amend the Trademark Law

HELD
1. NO.
Ratio Prohibition is not the proper remedy. Where the enabling statute indicates a procedure for administrative
review, and provides a system of administrative appeal, or reconsideration, the courts, for reasons of law, comity and
convenience, will not entertain a case unless the available administrative' remedies have been resorted to and the
appropriate authorities have been given opportunity to act and correct the errors committed in the administrative
forum.
- Prohibition is granted only in cases where no other remedy is available which is sufficient to afford redress. That the
petitioners have another and complete remedy at law either by appeal or otherwise, is generally a sufficient reason
for dismissing the writ.
Reasoning The proposed rates and charges still have to obtain the imprimatur of the Cabinet, and prior to which,
they have to undergo Cabinet scrutiny. Thus, there is the contingency that the same may not obtain the approval of
the Cabinet.
2. NO.
Ratio B.P. Blg. 325 requires Cabinet review and approval of the impugned administrative orders before their
publication. However, since the Cabinet has yet to review and approve the proposed revised rates of fees and
charges, there can be no proper publication.
3. NO.
- Since the challenged administrative orders have not yet been submitted to the Cabinet for its consideration and
approval, this Court finds it untimely to discuss and resolve the merits of the questions of whether or not the rate
increases and charges are just and reasonable sufficient to cover administrative costs, and/or that the same are
practicable and uniform for similar or comparable services and functions, and/or that those rates conform with the
rules and regulations of the Ministry of Finance.
- Courts should be reluctant to interfere with administrative action prior to its completion or finality, the reason being
that absence of a final order or decision, the power of the administrative agency concerned has not been fully
exercised and there can be no irreparable harm.
Reasoning
a. To prevent the courts from being swamped by a resort to them in the first instance
b. Rule on comity and convenience

QUASHA V SEC & MANILA POLO CLUB


320 SCRA 478
TEEHANKEE; May 31, 1978

FACTS
-Petitioner filed complaints with the SEC against the filing of Manila Polo Club’s (MPC) Amended Articles of
Incorporation and Amended By-Laws converting it into a proprietary club, alleging that such amendments would
enable the members to appropriate the club’s property and use it as their contribution to the ‘new’ club, essentially
negating the accrued contributions of past and present member’s (including his) money, time, effort and foresight for
a paltry proprietary membership fee (plus they allegedly had not been adopted by the required two-thirds vote).
-SEC denied such injunctive relief for lack of merit hence this petition with prayer for a restraining order enjoining
MPC from selling proprietary shares (the latter later issued by the Court).

ISSUE/S
1. WON petitioner failed to exhaust all administrative remedies before filing with the court
2. WON resolution of the issues w/o a full blown hearing on the merits deprived petitioner of due process

HELD
1. NO.
In view of the limited time, and considering the issuance of the order denying injunctive relief only at the height of the
Christmas holidays, petitioner properly filed directly with the Court without going through the prescribed procedure of
filing before the SEC en banc within the 30-day reglementary period since such recourse would not be a plain, speed
and adequate remedy.
2. YES.
- The issues set forth, such as the necessary two-thirds vote and the legality of the value of the proprietary shares
warrants the full-blown trial sought hence the case should be remanded to the SEC for such trial and determination
on merits.
-As for the TRO, it shall be lifted subject to the condition advanced by the SEC that should the amendments be later
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annulled, all payments made pursuant to it would be refunded to the members.

REPUBLIC OF THE PHILIPPINES (PCGG) v SANDIGANBAYAN


255 SCRA 438
FRANCISCO; March 29, 1996

FACTS
- Petitioner PCGG issued separate sequestration orders against Sipalay Trading Corporation and Allied Banking
Corporation, allegedly part of Lucio Tan’s ill-gotten wealth. 2 separate petitions were filed by Sipalay and Allied
before the SC assailing the sequestration orders. The SC referred the cases to the Sandiganbayan for proper
disposition.
- The petitions were jointly heard. The Sandiganbayan ordered the submission by PCGG of its formal evidence in
writing, but the latter instead filed a Motion to Dismiss. This motion to dismiss came nearly 7 years after Sipalay and
Allied originally filed their petitions before the SC. The ground was Sialay’s and Allied’s alleged failure to exhaust
administrative remedies. The PCGG argued that Sipalay and Allied should have first appealed the sequestration
orders to the Office of the President before challenging them in court, invoking the PCGG Rules and Regulations.
- The Sandiganbayan denied the motion and voided the orders issued against Sipalay and Allied.

ISSUES
WON Sandiganbayan’s denial of PCGG’s motion to dismiss is proper

HELD
YES
- Hardly can it be disputed that a direct action in court without prior exhaustion of administrative remedies, when
required, is premature, warranting its dismissal on a motion to dismiss grounded on lack of cause of action. The Court
approves of the filing of a motion to dismiss based upon failure to state a cause of action at any stage of the
proceedings.
- As a general rule, a motion to dismiss is interposed before the defendant pleads (Sec 1 Rule 16 Rules of Court).
However, there is no rule or law prohibiting the defendant from filing a motion to dismiss after an answer had been
filed. On the contrary, Section 2 of Rule 9, expressly authorizes the filing of such motion at any stage of the
proceedings when it is based upon failure to state a cause of action.
- These principles, at first impression, appear to favor the PCGG. Sections 5 and 6 of the PCGG Rules and
Regulations indeed provide an administrative mechanism for persons or entities contesting the sequestration orders
issued against them.
Section 5. - Who may contest - The person against whom a writ of sequestration or freeze or hold order is directed
may request the lifting thereof in writing, either personally or through counsel within 5 days from the receipt of the writ
of order.
Section 6. - Procedure for Review of writ or order - After due hearing or motu propio for good cause shown, the
Commission may lift the writ or order unconditionally or subject to such condition as it may deem necessary, taking
into consideration the evidence and circumstances of the case. The resolution of the Commission may be appealed
by the party concerned to the Office of the President of the Philippines within15 days from receipt thereof.
- Neither an initial request before the PCGG for the lifting of the sequestration orders nor an appeal to the Office of
the President was made by Sipalay and Allied before they filed their respective petitions in court. The PCGG’s
motion to dismiss was anchored on lack of cause of action, albeit filed beyond the period to answer.
- However, the peculiarities of this case preclude the rightful application of the principles aforestated. The Sipalay
and Allied petitions were both filed on the third quarter of 1986, while the PCGG decided to file its motion to dismiss
only in the middle of 1993. Nearly 7 years came to pass in between that so much has already transpired in the
proceedings during the interregnum. Sipalay and Allied had rested their cases, and the PCGG had finished
presenting all its witnesses, not to mention other various motions and incidents already disposed of by the
Sandiganbayan, with special attention to the numerous postponements granted the PCGG for presentation of its
evidence which prevented an earlier termination of the proceedings. The motion to dismiss came only at the
penultimate stage of the proceedings where the remaining task left for the PCGG was to file its written formal offer of
evidence as required by the Sandiganbayan.
- Failure to observe the doctrine of exhaustion of administrative remedies does not affect the jurisdiction of the Court.
We have repeatedly stressed this in a long line of decisions. The only effect of non-compliance with this rule is that it
will deprive the complainant of a cause of action, which is a ground for a motion to dismiss. If not invoked at the
proper time, this ground is deemed waived and the court can take cognizance of the case and try it.
- The length of time the PCGG allowed to drift away and its decision to file its motion to dismiss only at the
homestretch of the trial hardly qualify as “proper time.” Such tarried maneuver made the PCGG guilty of estoppel by
laches - “Laches has been defined as the failure or neglect, for an unreasonable and unexplained length of time, to
do that which by exercising due diligence could nor should have been done earlier; it is negligence or omission to
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assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it.”
- With its undenied belated action, 7 years in the making at that, it is only proper to presume with conclusiveness that
the PCGG has abandoned or declined to assert what it bewailed as the Sipalay and Allied petitions’ lack of cause of
action. “Proper time” cannot mean nor sanction an unexplained and unreasonable length of time such as 7 years.
The leniency extended by the Rules (Rule 9, Section 2, Rules of Court) and by jurisprudence in allowing a motion to
dismiss based on lack of cause of action filed after the answer or at any stage of the proceedings cannot be invoked
to cover-up and validate the onset of laches - or the failure to do something which should be done or to claim or
enforce a right at a proper time which, in this case, was one of the PCGG’s follies. Indeed, in matters of timeliness,
“indecent waste” is just as reprehensible as “indecent haste.”
- Another equally forceful reason warranting the denial of the PCGG’s motion to dismiss is that this case falls under
two recognized exceptions to the general rule of prior exhaustion of administrative remedies, and the
Sandiganbayan’s brief but lucid disquisition on one exception merits this Court’s approval.
“The rule on non-exhaustion of administrative remedies does not apply to petitioners’ case. This rule, which is based
on sound public policy and practical considerations, is not inflexible. It is subject to many exceptions, to wit: (i) where
there is estoppel on the part of the party invoking the doctrine; (ii) where the challenged administrative act is patently
illegal amounting to lack of jurisdiction; (iii) where there is unreasonable delay or official inaction that will irretrievably
prejudice the complainant; and (iv) where the question involved is purely legal and will ultimately have to be decided
by the courts of justice. x x x there was no absolute necessity of appealing respondent PCGG’s resolution to the
Office of the President, as purportedly required by Section 6 of the PCGG Rules and Regulations, inasmuch as
respondent PCGG seemed to have exhibited indifference towards petitioners’ pleas for the lifting of the sequestration
and search and seizure orders. Official inaction or unreasonable delay, as heretofore intimated, is one of the
exceptions to the rule on non-exhaustion of administrative remedies. Hence, under the circumstance, petitioners
may not be faulted for seeking relief directly from the courts.”
- The other exception is the first in the enumeration, i.e., “where there is estoppel on the part of the party invoking the
doctrine,” consisting in the PCGG’s being guilty of estoppel by laches which has just been discussed in great length.
In answer therefore to the first key issue, this Court rules in the affirmative. The denial of the PCGG’s motion to
dismiss was in order.

PAAT V CA (DE GUZMAN)


266 SCRA 167
TORRES, January 10, 1997

FACTS
-The truck of private respondent de Guzman was seized by DENR personnel because the driver could not produce
the required documents for the forest products found concealed in the truck. Petitioner Layugan (Community
Environment and Natural Resources Officer) issued an order of confiscation of the truck and gave de Guzman 15
days within which to submit an explanation why the truck should not be forfeited. De Guzman failed to submit the
required explanation. Regional Executive Director of DENR sustained Petitioner Layugan’s action of confiscation and
ordered the forfeiture of the truck.
-De Guzman filed a letter of reconsideration of the Regional Executive Director’s order – denied.
-De Guzman filed a letter to DENR Sec, wherein it was stated that in case the letter for reconsideration would be
denied, the letter should be considered an appeal to the Secretary. However, pending the decision of the DENR Sec,
De Guzman filed a suit for replevin with RTC. RTC issued a writ ordering the return of the truck to private
respondents Petitioners filed MD (De Guzman had no cause of action for failure to exhaust administrative remedies)
-RTC: MD denied – MFR – denied – filed petition for certiorari with CA
-CA: affirmed RTC decision that the question involved is purely a legal question
Petitioner:. Doctrine of exhaustion of administrative remedies
Respondent:. Doctrine does not apply because (1) due process was violated (not given a chance to be heard); (2)
seizure and forfeiture was unlawful because (a) DENR Sec and his representatives had no authority to confiscate and
forfeit conveyances utilized in transporting illegal forest products, (b) trucks were not used in the commission of the
crime

Hence, this present petition, 9 with prayer for temporary restraining order and/or preliminary injunction, seeking to
reverse the decision of the respondent Court of Appeals was filed by the petitioners on September 9, 1993. By virtue
of the Resolution dated September 27, 1993, 10 the prayer for the issuance of temporary restraining order of
petitioners was granted by this Court.

ISSUES
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1. WON, without violating the principle of exhaustion of administrative remedies, an action for replevin may prosper
to recover a movable property which is the subject matter of an administrative forfeiture proceeding in the DENR
pursuant to the Revised Forestry Code of the Philippines
2. WON the DENR Sec and his representatives empowered to confiscate and forfeit conveyances used in
transporting illegal forest products in favor of the government (second contention of respondents)

HELD
1. NO
Ratio. (GENERAL RULE) Before a party is allowed to seek the intervention of the court, it is a pre-condition that he
should have availed of all the means of administrative processes afforded him. If a remedy within the administrative
machinery can still be resorted to by giving the administrative officer concerned every opportunity to decide on a
matter that comes within his jurisdiction then such remedy should be exhausted first before court’s judicial power can
be sought. The premature invocation of court’s intervention is fatal to one’s cause of action. Accordingly, absent any
finding of waiver or estoppel the case is susceptible of dismissal for lack of cause of action. This doctrine of
exhaustion of administrative remedies was not without its practical and legal reasons, for one thing, availment of
administrative remedy entails lesser expenses and provides for a speedier disposition of controversies. It is no less
true to state that the courts of justice for reasons of comity and convenience will shy away from a dispute until the
system of administrative redress has been completed and complied with so as to give the administrative agency
concerned every opportunity to correct its error and to dispose of the case.
(EXCEPTION) It is disregarded (1) when there is a violation of due process, (2) when the issue involved is purely a
legal question, (3) when the administrative action is patently illegal amounting to lack or excess of jurisdiction, (4)
when there is estoppel on the part of the administrative agency concerned, (5) when there is irreparable injury, (6)
when the respondent is a department secretary whose acts as an alter ego of the President bears the implied and
assumed approval of the latter, (7) when to require exhaustion of administrative remedies would be unreasonable, (8)
when it would amount to a nullification of a claim, (9) when the subject matter is a private land in land case
proceedings, (10) when the rule does not provide a plain, speedy and adequate remedy, and (11) when there
are circumstances indicating the urgency of judicial intervention.
Reasoning. The controversy was pending before the DENR Secretary when it was forwarded to him following the
denial by the petitioners of the MFR. By appealing to him, the respondents acknowledged the existence of an
adequate and plain remedy still available and open to them in the ordinary course of law.
Obiter (on contention of respondents). ON DUE PROCESS: Due process does not necessarily mean or require a
hearing, but simply an opportunity or right to be heard. One may be heard, not solely by verbal presentation, but also,
and perhaps many times more creditably and practicable than oral argument, through pleadings.
ON ARGUMENT THAT THE TRUCKS SHOULD NOT BE CONFISCATED BECAUSE IT WAS NOT USED IN THE
COMMISSION OF A CRIME: the truck was indeed used in the commission of a crime – not theft but violation of EO
277.
-a suit for replevin can not be sustained against the petitioners for the subject truck taken and retained by them for
administrative forfeiture proceedings in pursuant to Section 68-A of the P. D. 705, as amended. Dismissal of the
replevin suit for lack of cause of action in view of the private respondents’ failure to exhaust administrative remedies
should have been the proper course of action by the lower court instead of assuming jurisdiction over the case and
consequently issuing the writ ordering the return of the truck. Exhaustion of the remedies in the administrative forum,
being a condition precedent prior to one’s recourse to the courts and more importantly, being an element of private
respondents’ right of action, is too significant to be waylaid by the lower court.

xxx xxx xxx


If this motion for reconsideration does not merit your favorable action, then this letter should be considered as an
appeal to the
Secretary. 24
It was easy to perceive then that the private respondents looked up to the Secretary for the review and disposition of
their case. By appealing to him, they acknowledged the existence of an adequate and plain remedy still available and
open to them in the ordinary course of the law. Thus, they cannot now, without violating the principle of exhaustion of
administrative remedies, seek court's intervention by filing an action for replevin for the grant of their relief during the
pendency of an administrative proceedings.
Moreover, it is important to point out that the enforcement of forestry laws, rules and regulations and the protection,
development and management of forest lands fall within the primary and special responsibilities of the Department of
Environment and Natural Resources. By the very nature of its function, the DENR should be given a free hand
unperturbed by judicial intrusion to determine a controversy which is well within its jurisdiction. The assumption by the
trial court, therefore, of the replevin suit filed by private respondents constitutes an unjustified encroachment into the
domain of the administrative agency's prerogative. The doctrine of primary jurisdiction does not warrant a court to
arrogate unto itself the authority to resolve a controversy the jurisdiction over which is initially lodged with an
administrative body of special competence. 25 In Felipe Ismael, Jr. and Co. vs. Deputy Executive Secretary, 26 which
was reiterated in the recent case of Concerned Officials of MWSS vs. Vasquez, 27 this Court held:
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Thus, while the administration grapples with the complex and multifarious problems caused by unbriddled exploitation
of these resources, the judiciary will stand clear. A long line of cases establish the basic rule that the courts will not
interfere in matters which are addressed to the sound discretion of government agencies entrusted with the regulation
of activities coming under the special technical knowledge and training of such agencies.

2. YES
Ratio. Section 686 and 68-A7 of PD 70, as amended by EO 277. The Secretary and his duly authorized
representatives are given the authority to confiscate and forfeit any conveyances utilized in violating the Code or
other forest laws, rules and regulations.
Disposition. Petition is GRANTED

LOPEZ V CITY OF MANILA


303 SCRA 448
QUISUMBING; February 19, 1999

FACTS
- Manila Ordinance No. 7894 (“An Ordinance Prescribed as the Revised Schedule of Fair Market Values of Real
Properties of the City of Manila”) was enacted. With its implementation, the tax on the land owned by the petitioner
was increased by 580%. With respect to the improvement on his property, the tax increased by 250%.
- Backstory: Sec 219 of RA 7160 or the Local Gov’t Code of 1991 requires that: “The provincial, city or municipal
assessor shall undertake a general revision of real property assessments within two (2) years after the effectivity of
this Code and every three (3) years thereafter.” This revision was not yet enforced in the City of Manila. Until 1995,
the basis for collection of real estate taxes was the old, year-1979, real estate market values.
- Mrs. Laderas, the newly appointed City Assessor of Manila, began the process of general revision based on the
updated fair market values of the real properties. This was submitted to the City Council. The Council then conducted
public hearings as required by law.
- As a consequence, petitioner filed a special proceeding for the declaration of nullity of the ordinance with preliminary
injunction and prayer for temporary restraining order (TRO).
- At around the same time, Manila Ordinance No. 7905 took effect, reducing by 50% the assessment levels
(depending on the use of property, e.g., residential, commercial) for the computation of tax due. It also provides that
the amendment shall take effect retroactively to Jan 1, 1996. As a result, it reduced the tax increase of petitioner’s
residential land to 155%, while the tax increase for residential improvement was 82%.
- Despite this, the controversy proceeded. The reason relied upon by the City of Manila for the dismissal of the
petition was for failure of the petitioner to exhaust administrative remedies.
- RTC directed the issuance of a writ of injunction. Respondent filed MFR on the denial of its motion to dismiss. It
also underscored the happening of a supervening event, i.e., the enactment and approval of the City Mayor of Manila
Ordinance No. 7905.
- RTC then granted MD. Lopez filed MFR, but was denied.
Petitioner’s Contentions
- When the trial court ruled that it has jurisdiction over the case, the question of whether he needs to resort to the
exhaustion of administrative remedies becomes moot and academic.
- The question of the constitutionality of the city ordinance may be raised on appeal, either to the Secretary of Justice
or the RTC, both having concurrent jurisdiction over the case (BP 129).
- At the time he instituted this complaint, it was premature to resort to the remedies provided by R.A. 7160 because
he has not received the formal notice of assessment yet.

ISSUE
WON petitioner failed to exhaust all administrative remedies

HELD
YES
Ratio As a general rule, where the law provides for the remedies against the action of an administrative board, body,
or officer, relief to courts can be sought only after exhausting all remedies provided. The reason rests upon the
6
Section 68: The court shall further order the confiscation in favor of the government of the timber or any forest products cut,
gathered, collected, removed, or possessed, as well as the machinery, equipments, implements and tools illegally used in the area
where the timber or forest products are found.
7
SECTION 68-A. Administrative Authority of the Department or His Duly Authorized Representative To Order Confiscation. In all
cases of violation of this Code or other forest laws, rules and regulations, the Department Head or his duly authorized
representative, may order the confiscation of any forest products illegally cut, gathered, removed, or possessed or abandoned, and
all conveyances used either by land, water or air in the commission of the offense and to dispose of the same in accordance with
pertinent laws, regulations and policies on the matter.
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presumption that the administrative body, if given the chance to correct its mistake or error, may amend its decision
on a given matter and decide it properly. This should be done not only to give the administrative agency the
opportunity to decide the matter by itself correctly, but also to prevent unnecessary and premature resort to courts.
- There are however a number of instances when the doctrine may be dispensed with and judicial action validly
resorted to immediately. Among these exceptional cases are:
(1) when the question raised is purely legal,
(2) when the administrative body is in estoppel;
(3) when the act complained of is patently illegal;
(4) when there is urgent need for judicial intervention;
(5) when the claim involved is small;
(6) when irreparable damage will be suffered;
(7) when there is no other plain, speedy and adequate remedy;
(8) when strong public interest is involved;
(9) when the subject of controversy is private land; and
(10) in quo-warranto proceeding.
* These exceptions are not present in the present case.
What could have been done? With regard to questions on the legality of a tax ordinance, the remedies available to
the taxpayer are provided under Sections 187, 226, and 252 of R.A. 7160. Taxpayer may bring an appeal before the
Secretary of Justice questioning legality of the city ordinance (Sec 187); owner of real property who is not satisfied
with the assessment of his property may, within sixty (60) days from notice of assessment, appeal to the Board of
Assessment Appeals (Sec 226); should the taxpayer question the excessiveness of the amount of tax, he must first
pay the amount due, then he must request the annotation of the phrase “paid under protest” and accordingly appeal
to the Board of Assessment Appeals (Sec 252).
** The crux of petitioner’s cause of action is the determination of whether or not the tax is excessive, oppressive or
confiscatory. This issue is essentially a question of fact and thereby, precludes this Court from reviewing the same.
The ordinance is likewise, a social legislation intended to soften the impact of the tremendous increase in the value of
the real properties subject to tax.
** The supervening circumstance of enactment of Manila Ordinance No. 7905 has rendered the petition, moot and
academic, for failure of the petitioner to amend his cause of action.

GARCIA V CA (PCA BOARD & GRATEDA)


G.R. No. 100579
VITUG; June 6, 2001

FACTS
-On 18 October 1988, the PCA Governing Board (Board) passed Resolution No. 109-88, creating an "Investigation
Committee" which would look into the complaint made by one Antonio Pua against petitioner, then administrator of
the Philippine Coconut Authority, for supposed irregularities committed by him.
-On 28 February 1989, the Investigation Committee submitted its finding that there was a prima facie case against
Garcia, and recommended that formal charges be filed against him, and that he be placed under preventive
suspension
-On 01 March 1989, the PCA, through its then Acting Board Chairman, Apolonio B. Bautista, filed an administrative
complaint against herein petitioner Leandro P. Garcia for dishonesty, falsification of official documents, grave
misconduct and violation of Republic Act No. 3019
-The Board placed petitioner under preventive suspension
-On 20 April 1989, the Investigation Committee scheduled hearings on the administrative case. Petitioner was duly
notified of these settings.
-Neither petitioner nor his counsel appeared during the hearings.
-On 30 May 1989, the Board issued Resolution No. 046-89, saying that consistent with Presidential Decree No. 807,
the period of delay in the disposition of the case resulting from the petitions/requests for extension of time,
postponement/cancellation of the scheduled hearings and related requests filed by the counsel of Garcia, shall not be
counted in computing the period of preventive suspension, and that his re-assumption of office as Administrator of
PCA shall require prior notice of reinstatement as may be issued by the Governing Board.
-Petitioner filed with the Regional Trial Court of Quezon City a petition for certiorari, mandamus and prohibition, with
prayer for a writ of preliminary injunction, seeking to enjoin the hearing of the administrative charges against him; the
implementation of Resolution No. 046-89; and the Board and persons acting in its behalf in making an action/decision
on the charges against petitioner pending hearing on the merits of his petition.
-The trial court issued a status quo order enjoining the Board and all persons acting in its behalf from "implementing
its Resolution No. 046-89 extending petitioner's preventive suspension."
-The trial court issued a writ of preliminary injunction restraining the PCA Governing Board from implementing its
Resolution No. 046-89.
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-Petitioner filed a motion praying for the creation of a new investigating committee and that, pending resolution, the
Investigation Committee be prevented from conducting further proceedings.
-On 14 July 1989, the trial court issued an order denying the same but allowing the reception of evidence on whether
a temporary restraining order shall issue.
-On 26 July 1989, the trial court issued an order enjoining the Investigation Committee from further conducting
investigation "within a period of twenty (20) days from receipt (of the order) and until (after) respondents (would have
been) heard"
-On 21 August 1989, the Grageda Investigation Committee submitted to the Board its resolution finding petitioner
guilty as charged and so recommended the penalty of forced resignation.
-On 25 August 1989, the Board passed Resolution No. 070-89, adopting and approving the Committee's
recommendation and imposing, effective 31 August 1989, the penalty of forced resignation on petitioner.
-On 28 August 1989, petitioner filed a supplemental petition with the trial court praying for a writ of preliminary
injunction to stop the Board from implementing Resolution No. 070-89 .
-On 11 September 1989, the trial court issued a temporary restraining order stopping respondent Board from
implementing its resolution of 21 August 1989 for a period of twenty (20) days from receipt thereof until the question
of whether or not the issue of petitioner's alleged deprivation of due process would have been resolved.
-On 25 September 1989, the trial court issued an order directing the issuance of a writ of preliminary injunction
restraining the PCA Governing Board from enforcing its Resolution No. 070-89.
-The Board moved for a reconsideration of the order, as well as the writ of preliminary injunction of Oct 2 1989, which
the trial court denied
-Respondents elevated the aforesaid orders to the SC, which referred the case to the CA
-CA granted the petition and set aside the orders of the TC granting the writ of preliminary injunction in favor of
respondent Garcia
-Petitioner’s MFR was denied, hence, this petition

ISSUE
WON the CA erred in declaring that the RTC committed grave abuse of discretion in issuing the questioned orders

HELD
NO
-The records would show that petitioner filed the petition for certiorari, mandamus and prohibition with TC even while
the administrative investigation was yet ongoing. Petitioner's immediate recourse to the trial court was premature and
precipitate. From the decision of the PCA Board, once rendered, an administrative remedy of appeal to the Civil
Service Commission would still be available to him.
-Under the doctrine of exhaustion of administrative remedies, recourse through court action, cannot prosper until after
all such administrative remedies would have first been exhausted. The doctrine does not warrant a court to arrogate
unto itself the authority to resolve, or interfere in, a controversy the jurisdiction over which is lodged initially with an
administrative body, like the PCA Board and its Investigation Committee, of special competence. The rule is an
element of petitioner's right of action, and it is too significant a mandate to be just waylaid by the courts.
-This Court has also said in a number of cases that: "When an adequate remedy may be had within the Executive
Department of the government, but nevertheless, a litigant fails or refuses to avail himself of the same, the judiciary
shall decline to interfere. This traditional attitude of the courts is based not only on convenience but likewise on
respect: convenience of the party litigants and respect for a coequal office in the government. If a remedy is available
within the administrative machinery, this should be resorted to before resort can be made to (the) courts."
-Petitioner's invocation that his failure to exhaust administrative remedies should be EXCEPTED by the fact that
irreparable damage would ensue upon his overdue suspension and illegal ouster from office cannot be countenanced
because in the case at bar, petitioner effectively, if not deliberately, delayed the resolution of the administrative case
against him due to his repeated requests for extension of time to file answer and his inexcusable refusal to attend the
scheduled hearings thereon despite due notice.
-The observance of the mandate regarding exhaustion of administrative remedies is a sound practice and policy
which should not be ignored. The doctrine insures an orderly procedure and withholds judicial interference until the
administrative process would have been allowed to duly run its course. Even comity dictates that unless the available
administrative remedies have been resorted to and appropriate authorities given an opportunity to act and correct the
errors committed in the administrative forum, judicial recourse must be held to be inappropriate and impermissible

DAR v APEX INVESTMENT AND FINANCING CORP.


401 SCRA 283
SANDOVAL-GUTIERREZ; April 10, 2003

FACTS
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- Apex owns parcels of land in Dasmarinas, Cavite. The Agrarian Reform Office in Dasmarinas initiated compulsory
acquisition proceedings pursuant to RA 6657 (Comprehensive Agrarian Reform Law). Apex claims the lots are
residential. Apex presented certification from the Municipal Engineer that the lots were classified as residential prior to
the effectivity of the CARL.
- The deed of one lot in the name of Apex was cancelled and a new one in the name of the RP was registered. Later,
it was transferred to a farmer who allegedly occupied the land. So apex filed a petition for certiorari and prohibition
praying that the compulsory acquisition proceedings over its landholdings be declared void.

ISSUES
1. WON Apex violated the principle of exhaustion of remedies
2. WON Apex was deprived of due process

HELD
1. NO.
- The Court has consistently held that the doctrine of exhaustion of administrative remedies is a relative one and is
flexible depending on the peculiarity and uniqueness of factual and circumstantial settings of a case. Among others, it
is disregarded where, as in this case,
(a) there are circumstances indicating the urgency of judicial intervention; and
(b) the administrative action is patently illegal and amounts to lack or excess of jurisdiction.
- Records show that the PARO did not take immediate action on respondent's Protest filed on January 12, 1998. It
was only on February 15, 1999, or after more than one year, that it forwarded the same to petitioner DAR. Since then,
what petitioner has done was to require respondent every now and then to submit copies of supporting documents
which were already attached to its Protest. In the meantime, respondent found that the PARO had caused the
cancellation of its title and that a new one was issued to an alleged farmer-beneficiary.
- In Natalia Realty vs. Department of Agrarian Reform, it was held that the aggrieved landowners were not supposed
to wait until the DAR acted on their letter-protests (after it had sat on them for almost a year) before resorting to
judicial process. Given the official indifference which, under the circumstances could have continued forever, the
landowners had to act to assert and protect their interests. Thus, their petition for certiorari was allowed even though
the DAR had not yet resolved their protests. In the same vein, respondent here could not be expected to wait for
petitioner DAR to resolve its protest before seeking judicial intervention. Obviously, petitioner might continue to
alienate respondent's lots during the pendency of its protest. Hence, the Court of Appeals did not err in concluding
that on the basis of the circumstances of this case, respondent need not exhaust all administrative remedies before
filing its petition for certiorari and prohibition.
2. YES.
- The CARL requires 2 notices: (1) notice of coverage and letter of invitation and (2) notice of acquisition.
- The 2-notice requirement was not complied with.
Disposition CA decision affirmed with modification.

SMART COMMUNICATIONS, INC v NTC


408 SCRA 678
YNARES-SANTIAGO; August 12, 2003

FACTS
- The NTC issued a memorandum circular regarding the billing of telecoms services, including the sale of sim cards.
- Petitioners Islacom and Piltel alleged, inter alia, that the NTC has no jurisdiction to regulate the sale of consumer
goods such as the prepaid call cards since such jurisdiction belongs to the Department of Trade and Industry under
the Consumer Act of the Philippines; that the Billing Circular is oppressive, confiscatory and violative of the
constitutional prohibition against deprivation of property without due process of law; that the Circular will result in the
impairment of the viability of the prepaid cellular service by unduly prolonging the validity and expiration of the
prepaid SIM and call cards; and that the requirements of identification of prepaid card buyers and call balance
announcement are unreasonable. Hence, they prayed that the Billing Circular be declared null and void ab initio.
- Soon thereafter, petitioners Globe Telecom, Inc. and Smart Communications, Inc. filed a joint Motion for Leave to
Intervene and to Admit Complaint-in-Intervention. This was granted by the trial court.
- RTC issued TRO enjoining NTC from implementing the circular.
- NTC filed a motion to dismiss on the ground of petitioners’ failure to exhaust administrative remedies.
- RTC denied NTC’s motion. NTC filed a special civil action certiorari and prohibition with the CA. CA granted the
petition and annunled and set aside the decision of the lower court.

ISSUES
WON RTC has jurisdiction over the case
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HELD
YES.
- In questioning the validity or constitutionality of a rule or regulation issued by an administrative agency, a party need
not exhaust administrative remedies before going to court. This principle applies only where the act of the
administrative agency concerned was performed pursuant to its quasi-judicial function, and not when the assailed act
pertained to its rule-making or quasi-legislative power.
- Even assuming arguendo that the principle of exhaustion of administrative remedies applies in this case, the
records reveal that petitioners sufficiently complied with this requirement. Even during the drafting and deliberation
stages leading to the issuance of Memorandum Circular No. 13-6-2000, petitioners were able to register their protests
to the proposed billing guidelines.
- Where what is assailed is the validity or constitutionality of a rule or regulation issued by the administrative agency
in the performance of its quasi-legislative function, the regular courts have jurisdiction to pass upon the same. The
determination of whether a specific rule or set of rules issued by an administrative agency contravenes the law or the
constitution is within the jurisdiction of the regular courts. Indeed, the Constitution vests the power of judicial review or
the power to declare a law, treaty, international or executive agreement, presidential decree, order, instruction,
ordinance, or regulation in the courts, including the regional trial courts. This is within the scope of judicial power,
which includes the authority of the courts to determine in an appropriate action the validity of the acts of the political
departments. Judicial power includes the duty of the courts of justice to settle actual controversies involving rights
which are legally demandable and enforceable, and to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.

ESTRADA ET AL V. CA (BACNOTAN CEMENT CORPORATION)


442 SCRA 117
AUSTRIA-MARTINEZ; NOV 11, 2004

FACTS
Estrada, Canilang and Lim, as concerned citizens and taxpayers, filed on July 31, 1996, before the Regional Trial
Court (RTC) of Olongapo City, a complaint for Injunction and Damages with Prayer for Preliminary Injunction and
Temporary Restraining Order against Bacnotan Cement Corp. (BCC), Wawandue Fishing Port, Inc. (WFPI), Khong
Hun as President of WFPI, Molina as Mayor of Subic, Zambales, and Serrano as Regional Director of the Department
of Environment and Natural Resources (DENR).
- The complaint alleges that: WFPI and the Municipality of Subic entered into an illegal lease contract, which in turn
became the basis of a sub-lease in favor of BCC; the sub-lease between WFPI and BCC is a violation of the first
lease because the cement plant, which BCC intended to operate in Wawandue, Subic, Zambales, is not related to the
fish port business of WFPI; and BCC’s cement plant is a nuisance because it will cause pollution, endanger the
health, life and limb of the residents and deprive them of the full use and enjoyment of their properties. The plaintiffs
prayed that an order be issued: to restrain and prohibit BCC from opening, commissioning, or otherwise operating its
cement plant; and to require the defendants to jointly and solidarily pay the plaintiffs P205,000.00 by way of actual,
moral and exemplary damages and attorney’s fees.
- Defendants WFPI/Khong Hun and BCC filed separate motions to dismiss, both alleging that the complaint states no
cause of action. BCC, in its motion, added that: the plaintiffs failed to exhaust administrative remedies before going to
court; that the complaint was premature; and that the RTC has no jurisdiction on the matter. Respondent Serrano of
the DENR also filed a motion to dismiss stating that there was no cause of action insofar as he is concerned since
there was nothing in the complaint that shows any dereliction of duty on his part.
- On December 6, 1996, Judge Ubiadas of RTC Olongapo City, Branch 72, issued an order denying respondents’
motions to dismiss and granting the prayer for a writ of preliminary injunction. Pertinent portions of the order read as
follows:
- The powers vested by law under Executive Order 192, Republic Act 3931 and Presidential Decree 984 are
regulatory merely and for the purpose of determining whether pollution exists.
- However, under the laws above-mentioned, the powers granted to the DENR thru the Pollution Adjudication Board
did not expressly exclude the Courts which under the law are empowered to try both questions of facts and law to
determine whether pollution which maybe nuisance per se or by accidents (sic) exist or likely to exist. Under the
Constitution, the courts are imbued the inherent power of general jurisdiction to resolve these issues. While it maybe
(sic) true that petitioners might have first to seek relief thru the DENR’s Pollution Adjudication Board a resort to the
remedy provided under the Pollution Adjudication Board is rendered useless and ineffective in the light of the urgency
that the said pollution be restrained outright in lieu of the impending risk described in the petition. It will be noted that
the DENR did not have the power either in Executive Order 192, Republic Act 3931 and Presidential Decree 984 to
issue a writ of injunction. The argument therefore for the exhaustion of administrative remedy and lack of jurisdiction
does not warrant the dismissal of this petition against Bacnotan Cement Corporation.
- Respondents’ motions for reconsideration were likewise denied by the trial court in an order dated May 13, 1997.
Respondent BCC then went to the Court of Appeals on a petition for certiorari and prohibition with preliminary
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injunction and/or temporary restraining order seeking to reverse and set aside the orders dated December 6, 1996
and May 13, 1997 as well as to lift the writ of preliminary injunction dated December 11, 1996.
- On April 6, 1998, the Court of Appeals rendered its decision, granting BCC’s petition. The Court of Appeals denied
petitioners’ motion for reconsideration on February 24, 1999.

ISSUE
WON the instant case falls under the exceptional cases where prior resort to administrative agencies need not be
made before going to court.

HELD
NO.
- The doctrine of exhaustion of administrative remedies requires that resort be first made with the administrative
authorities in the resolution of a controversy falling under their jurisdiction before the same may be elevated to a court
of justice for review. If a remedy within the administrative machinery is still available, with a procedure pursuant to law
for an administrative officer to decide the controversy, a party should first exhaust such remedy before going to court.
A premature invocation of a court’s intervention renders the complaint without cause of action and dismissible on
such ground.
- The reason for this is that prior availment of administrative remedy entails lesser expenses and provides for a
speedier disposition of controversies. Comity and convenience also impel courts of justice to shy away from a
dispute until the system of administrative redress has been completed and complied with.
- As we explained in Gonzales vs. Court of Appeals, the thrust of the rule on exhaustion of administrative remedies is
that the courts must allow the administrative agencies to carry out their functions and discharge their responsibilities
within the specialized areas of their respective competence. It is presumed that an administrative agency, if afforded
an opportunity to pass upon a matter, will decide the same correctly, or correct any previous error committed in its
forum. Furthermore, reasons of law, comity and convenience prevent the courts from entertaining cases proper for
determination by administrative agencies. Hence, premature resort to the courts necessarily becomes fatal to the
cause of action of the petitioner.
- While the doctrine of exhaustion of administrative remedies is flexible and may be disregarded in certain instances,
such as:
(1) when there is a violation of due process,
(2) when the issue involved is purely a legal question,
(3) when the administrative action is patently illegal amounting to lack or excess of jurisdiction,
(4) when there is estoppel on the part of the administrative agency concerned,
(5) when there is irreparable injury,
(6) when the respondent is a department secretary whose acts as an alter ego of the President bears [sic] the
implied and assumed approval of the latter,
(7) when to require exhaustion of administrative remedies would be unreasonable,
(8) when it would amount to a nullification of a claim,
(9) when the subject matter is a private land in land case proceedings,
(10) when the rule does not provide a plain, speedy and adequate remedy,
(11) when there are circumstances indicating the urgency of judicial intervention,
(12) when no administrative review is provided by law,
(13) where the rule of qualified political agency applies, and
(14) when the issue of non-exhaustion of administrative remedies has been rendered moot.
- the case does not fall under any of the exceptional circumstances.
- Petitioners claim that their action before the trial court, without going to the DENR first, is justified because they are
in danger of suffering grave and irreparable injury from the operation of respondent’s cement repacking plant and the
DENR does not have the power to grant them the relief they are praying for.
- RA 3931, An Act Creating the National Water and Air Pollution Control Commission, was passed on June 18, 1964
to maintain reasonable standards of purity for the waters and air of the country with their utilization for domestic,
agricultural, industrial and other legitimate purposes. It created the NPCC which had the power, to issue, renew, or
deny permits, for the prevention and abatement of pollution.
- In 1976, Presidential Decree No. 984 was enacted to strengthen the NPCC giving it, among others, the following:
Sec. 6. Powers and Functions – xxx
(e) Issue orders or decisions to compel compliance with the provisions of this Decree and its implementing rules
and regulations only after proper notice and hearing.
(f) Make, alter or modify orders requiring the discontinuance of pollution specifying the conditions and the time
within which such discontinuance must be accomplished.
(g) Issue, renew, or deny permits, under such conditions as it may determine to be reasonable, for the
prevention and abatement of pollution, for the discharge of sewage, industrial waste, or for the installation or
operation of sewage works and industrial disposal system or parts thereof…
xxx
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(j) serve as arbitrator for the determination of reparations, or restitution of the damages and losses resulting
from pollution.
- P.D. No. 984 also empowered the commission to issue ex parte orders directing the discontinuance or temporary
suspension or cessation of operation of an establishment or person generating sewage or wastes without the
necessity of prior public hearing whenever it finds a prima facie evidence that the discharged sewage or wastes are
of immediate threat to life, public health, safety or welfare, or to animal or plant life, or exceed the allowable standards
set by the commission.
- In 1987, Executive Order No. 192 was passed, reorganizing the DENR. It transferred the power of the NPCC to the
Environmental Management Bureau and created the PAB, under the Office of the Secretary, which assumed the
powers and functions of the NPCC with respect to the adjudication of pollution cases under R.A. No. 3931 and P.D.
No. 984.
- In Pollution Adjudication Board vs. Court of Appeals, the PAB is the very agency of the government with the task of
determining whether the effluents of a particular industrial establishment comply with or violate applicable anti-
pollution statutory and regulatory provisions. We also recognized its power to issue, ex parte, cease and desist
orders. As a general rule, the adjudication of pollution cases generally pertains to the Pollution Adjudication Board
(PAB), except in cases where the special law provides for another forum.

REGINO v. PANGASINAN COLLEGES OF SCIENCE AND TECHNOLOGY, GAMUROT & BALADAD


443 SCRA 56
PANGANIBAN; November 18, 2004

FACTS
- Khristine Regino was a 1 st yr computer science student at PCST. Reared in a poor family, Regino went to college
mainly through the financial support of her relatives. During the second semester of school year 2001-2002, she
enrolled in logic and statistics subjects under Gamurot and Baladad, as teachers.
- In Feb 2002, PCST held a fund raising campaign dubbed the "Rave Party and Dance Revolution," the proceeds of
which were to go to the construction of the school's tennis and volleyball courts. Each student was required to pay for
two tickets at P100 each. The project was allegedly implemented by recompensing students who purchased tickets
with additional points in their test scores; those who refused to pay were denied the opportunity to take the final
examinations.
- Financially strapped and prohibited by her religion from attending dance parties and celebrations, Regino refused to
pay for the tickets. Consequently, her respondent teachers disallowed her from taking the tests. (Gamurot made her
sit out her logic class while her classmates were taking their examinations. The next day, Baladad, after announcing
to the entire class that she was not Khristine and another student to take their statistics examinations for failing to pay
for their tickets, allegedly ejected them from the classroom.)
- Khristine's pleas ostensibly went unheeded by Gamurot and Baladad, who defended their positions as compliance
with PCST's policy. She filed complaint for damages against PCST, Gamurot and Baladad.
- PCST filed a MD on the ground of failure to exhaust administrative remedies. According to respondents, the
question raised involved the determination of the wisdom of an administrative policy of the PCST; hence, the case
should have been initiated before the proper administrative body, the Commission of Higher Education (CHED).
- In her response to MD, Khristine argued that prior exhaustion of administrative remedies was unnecessary, because
her action was not administrative in nature, but one purely for damages arising from respondents' breach of the laws
on human relations.
- RTC dismissed the Complaint for lack of cause of action w/o explaining the ground. RTC citing said that Sec 54 of
the Education Act of 1982 vested in the Commission on Higher Education (CHED) the supervision and regulation of
tertiary schools. Thus, it ruled that the CHED, not the courts, had jurisdiction over the controversy.

ISSUES
1. WON doctrine of exhaustion of administrative remedies is applicable
2. WON the Complaint stated sufficient cause(s) of action

HELD:
1. NO.
Factoran Jr. v. CA: "The doctrine of exhaustion of administrative remedies is basic. Courts, for reasons of law,
comity, and convenience, should not entertain suits unless the available administrative remedies have first
been resorted to and the proper authorities have been given the appropriate opportunity to act and correct
their alleged errors, if any, committed in the administrative forum. x x x."
- Khristine isn’t asking for the reversal of the policies of PCST. Neither is she demanding it to allow her to take her
final examinations; she was already enrolled in another educational institution.
- Exhaustion of administrative remedies is applicable when there is competence on the part of the administrative body
to act upon the matter complained of. (Miriam College Foundation v. CA)
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- United Residents of Dominican Hill, Inc. v. Commission on the Settlement of Land Problems: Administrative
agencies are not courts; they are neither part of the judicial system, nor are they deemed judicial tribunals.
Specifically, the CHED does not have the power to award damages. Hence, petitioner could not have commenced
her case before the Commission.
- The exhaustion doctrine admits of exceptions, one of which arises when the issue is purely legal and well within the
jurisdiction of the trial court. Petitioner's action for damages inevitably calls for the application and the interpretation of
the Civil Code, a function that falls within the jurisdiction of the courts.
2. YES, breach of contract and liability for tort.
- Every complaint must sufficiently allege a cause of action; failure to do so warrants its dismissal. A complaint is said
to assert a sufficient cause of action if, admitting what appears solely on its face to be correct, the plaintiff would be
entitled to the relief prayed for. Assuming the facts that are alleged to be true, the court should be able to render a
valid judgment in accordance with the prayer in the complaint.
Reciprocity of the School-Student Contract
- Alcuaz v. PSBA: the Court characterized the relationship between the school and the student as a contract, in which
"a student, once admitted by the school is considered enrolled for one semester." Two years later, in Non v. Dames II,
the Court modified the "termination of contract theory" in Alcuaz by holding that the contractual relationship between
the school and the student is not only semestral in duration, but for the entire period the latter are expected to
complete it.” Except for the variance in the period during which the contractual relationship is considered to subsist,
both Alcuaz and Non were unanimous in characterizing the school-student relationship as contractual in nature.
- The school-student relationship is also reciprocal. Thus, it has consequences appurtenant to and inherent in all
contracts of such kind -- it gives rise to bilateral or reciprocal rights and obligations. The school undertakes to provide
students with education sufficient to enable them to pursue higher education or a profession. On the other hand, the
students agree to abide by the academic requirements of the school and to observe its rules and regulations.
- The terms of the school-student contract are defined at the moment of its inception -- upon enrolment of the student.
Standards of academic performance and the code of behavior and discipline are usually set forth in manuals
distributed to new students at the start of every school year. Further, schools inform prospective enrollees the amount
of fees and the terms of payment.
- Magtibay v. Garcia, Licup v. University of San Carlos and Ateneo de Manila University v. Garcia: “barring any
violation of the rules on the part of the students, an institution of higher learning has a contractual obligation to afford
its students a fair opportunity to complete the course they seek to pursue.”
- In the present case, PCST imposed the assailed revenue-raising measure belatedly, in the middle of the semester.
It exacted the dance party fee as a condition for the students' taking the final examinations, and ultimately for its
recognition of their ability to finish a course. The fee, however, was not part of the school-student contract entered
into at the start of the school year. Hence, it could not be unilaterally imposed to the prejudice of the enrollees.
- The school-student contract "is imbued with public interest, considering the high priority given by the Constitution to
education and the grant to the State of supervisory and regulatory powers over all educational institutions." Sec. 5 (1)
and (3) of Article XIV of the 1987 Constitution provide:
"The State shall protect and promote the right of all citizens to quality education at all levels and shall take
appropriate steps to make such declaration accessible to all.
"Every student has a right to select a profession or course of study, subject to fair, reasonable and equitable
admission and academic requirements."
Sec. 9(2) of BP 232, otherwise known as the Education Act of 1982:
"Section 9. Rights of Students in School. � In addition to other rights, and subject to the limitations prescribed by
law and regulations, students and pupils in all schools shall enjoy the following rights:
xxx xxx xxx
(2) The right to freely choose their field of study subject to existing curricula and to continue their course therein up
to graduation, except in cases of academic deficiency, or violation of disciplinary regulations."
Liability for Tort
- Khristine anchors her complaint for tort on Art. 19, 21, 26 of the NC C (she alleged that PCST "inhumanly punish
students x x x by reason only of their poverty, religious practice or lowly station in life, which inculcated upon her the
feelings of guilt, disgrace and unworthiness;" as a result of such punishment, she was allegedly unable to finish any
of her subjects for the second semester of that school year and had to lag behind in her studies by a full year.
- Generally, liability for tort arises only between parties not otherwise bound by a contract. An academic institution,
however, may be held liable for tort even if it has an existing contract with its students, since the act that violated the
contract may also be a tort.
- PSBA vs. CA: "x x x A perusal of Article 2176 [of the Civil Code] shows that obligations arising from quasi-delicts or
tort, also known as extra-contractual obligations, arise only between parties not otherwise bound by contract, whether
express or implied. However, this impression has not prevented this Court from determining the existence of a tort
even when there obtains a contract. In Air France v. Carrascoso (124 Phil. 722), the private respondent was awarded
damages for his unwarranted expulsion from a first-class seat aboard the petitioner airline. It is noted, however, that
the Court referred to the petitioner-airline's liability as one arising from tort, not one arising form a contract of carriage.
In effect, Air France is authority for the view that liability from tort may exist even if there is a contract, for the act that
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breaks the contract may be also a tort. x x x This view was not all that revolutionary, for even as early as 1918, this
Court was already of a similar mind. In Cangco v. Manila Railroad (38 Phil. 780), Mr. Justice Fisher elucidated thus: 'x
x x. When such a contractual relation exists the obligor may break the contract under such conditions that the same
act which constitutes a breach of the contract would have constituted the source of an extra-contractual obligation
had no contract existed between the parties.'
"Immediately what comes to mind is the chapter of the Civil Code on Human Relations, particularly Article 21 x x x."
Academic Freedom (PCST’s defense which SC didn’t buy  )
- Academic freedom encompasses the independence of an academic institution to determine for itself (1) who may
teach, (2) what may be taught, (3) how it shall teach, and (4) who may be admitted to study.
- Garcia v. the Faculty Admission Committee, Loyola School of Theology: “freedom of an academic institution thus:
"to decide for itself aims and objectives and how best to attain them x x x free from outside coercion or interference
save possibly when overriding public welfare calls for some restraint."
- Tangonan v. Paño: “once a school has, in the name of academic freedom, set its standards, these should be
meticulously observed and should not be used to discriminate against certain students. After accepting them upon
enrollment, the school cannot renege on its contractual obligation on grounds other than those made known to, and
accepted by, students at the start of the school year.”

FLORES v SANGGUNIANG PANLALAWIGAN NG PAMPANGA, GOV LAPID, MUNICIPAL COUNCILORS


GR NO. 159022
SANDOVAL-GUTIERREZ; Feb 23, 2000

FACTS
- An administrative complaint for dishonesty and gross misconduct against Mayor Flores was filed w/ Sangguniang
Panlalawigan of Pampanga. Complainants were the councilors.
- Case was about acquisition of communication equipment w/o resolution or ordinance by Sangguniang Bayan. Kai
Electronics won in bidding. While bidding was still being conducted, Kai delivered the equipment. It was overpriced.
- Sangguniang Panlalawigan recommended to Lapid that Flores be preventively suspended.
- Without seeking reconsideration of that recommendation, Flores wrote to Lapid, requesting him to veto the same
- And without waiting for Lapid’s action, Flores filed with CA petition for certiorari. CA denied petition because of
failure to exhaust administrative remedies. Also, CA found no grave abuse of discretion. Flores’ MFR was denied.
Hence, this petition.

ISSUE
WON Flores failed to exhaust administrative remedies

HELD
YES
- After receiving order of preventive suspension, Flores should have filed MFR to give Sangguniang Panlalawigan
opportunity to correct itself if necessary. This MFR is a condition sine qua non before filing petition for certiorari under
Rule 65.
- Petitioner must not only show that respondent Sangguniang Panlalawigan, in issuing the questioned Order, “acted
without or in excess of its jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction,”
but that “there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law.”
- he should have waited for Lapid’s action since it is Lapid, as Governor, who is empowered to suspend him,
according to Local Government Code.
- The rationale rests upon presumption that the administrative body, if given chance to correct its mistake / error, may
amend its decision. It will also prevent unnecessary and premature resort to the court.

CSC V DBM
G.R. No. 158791
CARPIO-MORALES; July 22, 2005

FACTS
- CSC seeks to compel the DBM to release the balance of its budget for fiscal year 2002. At the same time, it seeks
a determination by this Court of the extent of the constitutional concept of fiscal autonomy.
- Petitioner claims the amount of P215,270,000.00 was appropriated for its Central Office by the General
Appropriations Act of 2002, while the total allocations for the same Office, if all sources of funds are considered,
amount to P285,660,790.44. It complains, however, that the total fund releases by respondent to its Central Office
during the fiscal year 2002 was only P279,853,398.14, thereby leaving an unreleased balance of P5,807,392.30.
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- The balance was intentionally withheld by respondent on the basis of its “no report, no release” policy whereby
allocations for agencies are withheld pending their submission of the documents mentioned in Sections 3.8 to 3.10
and Section 7.0 of National Budget Circular No. 478 on Guidelines on the Release of the FY 2002 Funds. Petitioner
contends that the application of the “no report, no release” policy upon independent constitutional bodies of which it is
one is a violation of the principle of fiscal autonomy and, therefore, unconstitutional.

ISSUE
1. WON petition should be dismissed because of procedural defects
2. WON DBM is justified in withholding the funds

HELD
1. NO
- The rule on exhaustion of administrative remedies invoked by respondent applies only where there is an express
legal provision requiring such administrative step as a condition precedent to taking action in court. As petitioner is
not mandated by any law to seek clarification from the DBM Secretary prior to filing the present action, its failure to do
so does not call for the application of the rule.
- As for the rule on hierarchy of courts, it is not absolute. A direct invocation of this Court's original jurisdiction may
be allowed where there are special and important reasons therefor, clearly and specifically set out in the petition.
Petitioner justifies its direct filing of the petition with this Court “as the matter involves the concept of fiscal autonomy
granted to [it] as well as other constitutional bodies, a legal question not heretofore determined and which only the
Honorable Supreme Court can decide with authority and finality.”
2. NO
- Province of Batangas v. Romulo, on “automatic release” in Sec 6, Article X of the Constitution: Webster’s Third New
International Dictionary defines “automatic” as “involuntary either wholly or to a major extent so that any activity of the
will is largely negligible; of a reflex nature; without volition; mechanical; like or suggestive of an automaton.” Further,
the word “automatically” is defined as “in an automatic manner: without thought or conscious intention.” Being
“automatic,” thus, connotes something mechanical, spontaneous and perfunctory. As such the LGUs are not
required to perform any act to receive the “just share” accruing to them from the national coffers.
- By parity of construction, “automatic release” of approved annual appropriations to petitioner, a constitutional
commission which is vested with fiscal autonomy, should be construed to mean that no condition to fund releases to it
may be imposed. This is consistent with the Resolution of this Court which effectively prohibited the enforcement of a
“no report, no release” policy against the Judiciary which has also been granted fiscal autonomy by the Constitution.
- On respondent’s justification for withholding funds from petitioner as due to a shortfall in revenues, the same does
not lie. The alleged shortfall is totally unsubstantiated. Even assuming that there was indeed such a shortfall, that
does not justify non-compliance with the mandate of above-quoted Article IX (A), Section 5 of the Constitution.
- To hold that petitioner may be subjected to withholding or reduction of funds in the event of a revenue shortfall
would, to that extent, place petitioner and the other entities vested with fiscal autonomy on equal footing with all
others which are not granted the same autonomy, thereby reducing to naught the distinction established by the
Constitution. The agencies vested with fiscal autonomy should thus be given priority in the release of their approved
appropriations over all other agencies not similarly vested when there is a revenue shortfall.
- While the retention or reduction of appropriations for an office is generally allowed when there is an unmanageable
budget deficit, the Year 2002 GAA, in conformity with the Constitution, excepted from such rule the appropriations for
entities vested with fiscal autonomy. Thus, even assuming that there was a revenue shortfall as respondent claimed,
it could not withhold full release of petitioner’s funds without violating not only the Constitution but also Section 64 of
the General Provisions of the Year 2002 GAA.
- Guiding principle on the Constitutional Mandate on the Judiciary’s Fiscal Autonomy: “After approval by Congress,
the appropriations for the Judiciary shall be automatically and regularly released subject to availability of funds.” This
phrase “subject to availability of funds” does not contradict the present ruling that the funds of entities vested with
fiscal autonomy should be automatically and regularly released, a shortfall in revenues notwithstanding. What is
contemplated in the said quoted phrase is a situation where total revenue collections are so low that they are not
sufficient to cover the total appropriations for all entities vested with fiscal autonomy.
- petitioner’s claim that its budget may not be reduced by Congress lower than that of previous fiscal year, as is the
case of the Judiciary, must be rejected. Article IX (A), Section 5 does not contain the similar provision in Art VIII,
Section 3, which says, “Appropriations for the Judiciary may not be reduced by the legislature below the amount
appropriated for the previous year.” The plain implication of the omission of the provision proscribing such
reduction of appropriations below that for the previous year is that Congress is not prohibited from reducing the
appropriations of Constitutional Commissions below the amount appropriated for them for the previous year.

C. PRIMARY JURISDICTION ON PRELIMINARY RESORT

TEXAS & PACIFIC RAILROAD CO. v ABILENE COTTON OIL


204 US 426
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WHITE; February 25, 1907

FACTS
- The Abilene Cotton Oil Co. (Abilene) sued Texas & Pacific Railroad Co. (Texas & Pac) to recover $1,951.83 alleging
that on shipments of car loads of cotton seed made from various points in Louisiana east of Alexandria, in that state,
to Abilene, Texas, the carrier had exacted, over the protest of Abilene, the payment of an unjust and unreasonable
rate, which exceeded, in the aggregate, by the sum sued for, a just and reasonable charge. Moreover, the rate
exacted was discriminatory, constituted an undue preference, and amounted to charging more for a shorter than for a
longer haul.
- Texas & Pac argued that the shipments were interstate, and were, therefore, covered by the act of Congress to
regulate commerce. As the rate was the one fixed in the rate sheets which the company had established, filed,
published, and posted, as required by that act, the state court was without jurisdiction to entertain the cause, and,
even if it had jurisdiction, it could not, without disregarding the act to regulate commerce, grant relief upon the basis
that the established rate was unreasonable, when it had not been found to be so by the Interstate Commerce
Commission (ICC).
- The trial court ruled for Texas & Pac saying that it complied with the interstate commerce law and the rates, though
excessive, were posted in the depots for the inspection of the public and were approved by the ICC. The Court of
Civil Appeals adopted the findings of fact but reversed judgment saying that a shipper may be granted relief under
common law despite the fact that the excessive rates are in accordance with law.

ISSUES
WON a shipper may maintain an action at law against a common carrier to recover damages because of the exaction
of an unreasonable rate although the rate was in accordance with the act to regulate commerce and was the duty of
the carrier to enforce

HELD
1. NO.
Ratio A shipper seeking reparation predicated upon the unreasonableness of the established rate must, under the act
to regulate commerce, primarily invoke redress through the ICC, which body alone is vested with power originally to
entertain proceedings for the alteration of an established schedule, because the rates fixed therein are unreasonable.
Reasoning The act to regulate commerce was intended to afford an effective means for redressing the wrongs
resulting from unjust discrimination and undue preference. The means by which these purposes were to be
accomplished was the placing upon all carriers the positive duty to establish schedules of reasonable rates which
should have a uniform application to all, and which should not be departed from so long as the established schedule
remained unaltered in the manner provided by law.
- If it be that the standard of rates fixed in the mode provided by the statute could be treated on the complaint of a
shipper by a court and jury as unreasonable, without reference to prior action by the ICC, finding the established rate
to be unreasonable, and ordering the carrier to desist, a shipper might obtain relief and thus such shipper would
receive a preference or discrimination not enjoyed by those against whom the schedule of rates was continued to be
enforced. If, without previous action by the ICC, power might be exerted by courts and juries to determine the
reasonableness of an established rate, it would follow that, unless all courts reached an identical conclusion, a
uniform standard of rates in the future would be impossible, as the standard would fluctuate and vary, dependent
upon the divergent conclusions reached by the various courts. The recognition of such a right is wholly inconsistent
with the administrative power conferred upon the ICC and its duty under the statute of seeing to it that the statutory
requirement as to uniformity and equality of rates is observed.

PHIL. GLOBAL COMMUNICATIONS INC v RELOVA


GR No. L-52819
FERNANDO; OCT. 2, 1980

FACTS
- Petitioner filed with the Board of Telecommunications an application for authority to establish a branch or station in
Cebu City "for the purpose of rendering international telecommunications services from Cebu City to any point
outside the Philippines where it is authorized to operate. The SolGen and private respondents opposed such
application. The Board of Communications rendered a decision, recognizing the right of petitioners under its
legislative franchise to establish branches or stations anywhere in the Philippines, subject to its prior approval. A joint
motion for reconsideration came from private respondents, followed as could be expected by an opposition from
petitioner. In a reply to such opposition, private respondents put in issue the jurisdiction of the Board of
Communications, now the National Telecommunications Commission, to act on such application. Such motion is still
pending. Private respondents filed before respondent Judge an action for declaratory judgment to ascertain the scope
and coverage of the legislative franchise of petitioner, it was ratified to Branch XI, presided by respondent Judge.
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- There was a motion to dismiss by petitioner on the ground that the question raised in such suit pertained to the
National Telecommunications Commission, the body with primary jurisdiction. Respondent Judge denied petitioner's
motion to dismiss as in his opinion the ground relied is not indubitable. Hence this certiorari and prohibition
proceeding.

ISSUES
WON the petition for declaratory relief lies.

HELD
YES.
- A suit for declaratory relief lies and, therefore, the petition must be dismissed. There was such a limitation
concerning the ingress and egress of its messages or signals only thru a "sole gateway" (Manila) or only thru any
point or single location in the Philippines. Absent such clarity as to the scope and coverage of its franchise a legal
question arises which is more appropriate for the judiciary than for an administrative agency to resolve. The doctrine
of primary jurisdiction calls for application when there is such competence to act on the part of an administrative body.
Petitioner assumes that such is the case. That is to beg the question. There is merit, therefore, to the approach taken
by private respondents to seek judicial remedy as to whether or not the legislative franchise could be so interpreted
as to enable the National Telecommunications Commission to act on the matter. A jurisdictional question thus arises
and calls for an answer.
- The conclusion reached is reinforced by the nature of the assailed order of respondent Judge. It was merely a
denial of a motion to dismiss the suit for declaratory relief for the reason that the ground relied upon "is not
indubitable." There is thus the appearance and the reality of an unseemly haste in which the matter was brought to
this Court considering that the well-known doctrine that certiorari to be available as set forth in Panaligan vs. Adolfo,
requires a showing of "a capricious, arbitrary and whimsical exercise of power, the very antithesis of the judicial
prerogative in accordance with centuries of both civil law and common law traditions."
DISPOSITION petition is dismissed for lack of merit. The restraining order issued is set aside.

VIDAD v RTC OF NEGROS ORIENTAL


227 SCRA 271
VITUG; October 18, 1993

FACTS
- A group of public school teachers held a strike from their classes, to demand the release of their salaries by the
Department of Budget. They also assailed alleged corruption in the DECS.
- DECS Regional Director issued a return-to-work order, with a warning that if the striking school teachers didn’t
resume their classes within 24 hours, administrative charges would be filed. The order wasn’t heeded, so
administrative complaints against the teachers were filed. Constituted to look into the cases was an investigation
panel composed of 3 DECS lawyers, Baclaso, Montes and Capuyan.
- A group of school teachers administratively charged filed with the RTC a complaint fo injunction, prohibition and
damages, with a prayer for preliminary injunction, against the aforenamed DECS officials. The TRO prohibiting the
defendants from continuin with the administrative investigation was granted by the court.
- the defendants filed their answer and a motion to dismiss. The school teachers moved to strike out the appearance
of the Office of the Solicitor General and to accordingly declare the defendants in default. Both motions were denied
by the court.
- both parties filed with this Court their respective petitions for Certiorari, Prohibition, and Mandamus. The teachers’
petition was docketed as GR No 98084, and that of the DECS officials as GR No 98922. Both these cases were
consolidated in this Court’s resolution.

ISSUES
WON the lower court’s denial of both parties’ motions was improper

HELD
NO
Reasoning The various complaints against the DECS officials have prescinded from the administrative actions
taken, and contemplated to be yet taken, against public school teachers, the plaintiffs in the cases pending with the
court a quo. The said complaints charge the defendants, all government officials, with having illegally withheld their
salaries, having wrongfully filed administrative charges against the plaintiffs, having unjustifiably refused to inform the
latter of the nature and accuse of accusation upon which the charges were initiated, having inexcusably violated
elemental due process, and having erroneously applied the law.
- The contention of the school teachers that the DECS officials are being sued solely in their private capacity certainly
is not borne out by their above allegations and prayers. The root of the cases filed below deals, in fact, on the
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performance of official functions by the DECS officials. Whether the actions they have taken were proper or improper,
or whether they have acted in good faith or bad faith, cannot, pending a full hearing that would aptly afford all parties
an opportunity to ventilate their respective contentions, be yet determined. Until then, it must be presumed that official
duties have been regularly performed.
- There’s also no reversible error in the denial of a the defendant’s motion to dismiss the complaints. The various
complaints filed by the public school teachers allege bad faith on the part of the DECS officials. It cannot be
pretended this early that the same could be impossible of proof. On the assumption that the plaintiffs are able to
establish their allegations of bad faith, a judgment for damages can be warranted. Public officials are certainly not
immune from damages in their personal capacities arising from the acts done in bad faith; in these and similar cases,
the public officials may not be said to have acted within the scope of their official authority, and no longer are they
protected by the mantle of immunity for official actions.
- The court cases and the administrative matters are closely interrelated, if not, indeed, interlinked. While no
prejudicial question strictly arises where one is a civil case and the other is an administrative proceeding, in the
interest of good order, it behooves the court to suspend its action on the cases before it pending the final outcome of
the administrative proceedings. The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself the
authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative body of special
competence. We see, in these petitions before us, no cogent reason to deviate from the rule.

INDUSTRIAL ENTERPRISES, INC. V CA (MARINDUQUE MINING)


184 SCRA 426
MELENCIO-HERRERA; April 18, 1990

FACTS
- Petitioner IEI was granted a coal operating contract by the Government through the Bureau of Energy Development
(BED) for the exploration of two coal blocks in Eastern Samar. Subsequently, IEI also applied with the then Ministry of
Energy for another coal operating contract for the exploration of 3 add’l. coal blocks which, together with the original 2
blocks, comprised the so-called "Giporlos Area."
- IEI was later on advised that in line with the objective of rationalizing the country's over-all coal supply-demand
balance… the logical coal operator in the area should be the Marinduque Mining and Industrial Corporation (MMIC),
which was already developing the coal deposit in another area (Bagacay Area) and that the Bagacay and Giporlos
Areas should be awarded to MMIC. Thus, IEI and MMIC executed a Memorandum of Agreement whereby IEI
assigned and transferred to MMIC all its rights and interests in the 2 coal blocks which are the subject of IEI's coal
operating contract.
- Subsequently, however, IEI filed an action for rescission of the Memorandum of Agreement with damages against
MMIC and the then Minister of Energy Velasco before RTC Makati, Branch 150, alleging that MMIC took possession
of the subject coal blocks even before the MOA was finalized and approved by the BED; that MMIC discontinued
work thereon; that MMIC failed to apply for a coal operating contract for the adjacent coal blocks; and that MMIC
failed and refused to pay the reimbursements agreed upon and to assume IEI's loan obligation as provided in the
MOA. IEI also prayed that the Energy Minister be ordered to approve the return of the coal operating contract from
MMIC to petitioner, with a written confirmation that said contract is valid and effective, and, in due course, to convert
said contract from an exploration agreement to a development/production or exploitation contract in IEI's favor.
- In a summary judgment, the Trial Court ordered the rescission of the MOA, declared the continued efficacy of the
coal operating contract in favor of IEI; ordered the reversion of the 2 coal blocks covered by the coal operating
contract; ordered BED to issue its written affirmation of the coal operating contract and to expeditiously cause the
conversion thereof from exploration to development in favor of IEI; directed BED to give due course to IEI's
application for a coal operating contract; directed BED to give due course to IEI's application for 3 more coal blocks;
and ordered the payment of damages and rehabilitation expenses.
- In reversing the TC, the CA held that the rendition of the summary judgment was not proper since there were
genuine issues in controversy between the parties, and more importantly, that the TC had no jurisdiction over the
action considering that, under Presidential Decree No. 1206, it is the BED that has the power to decide controversies
relative to the exploration, exploitation and development of coal blocks.

ISSUE/S
WON the civil court has jurisdiction to hear and decide the suit for rescission of the Memorandum of Agreement
concerning a coal operating contract over coal blocks.

HELD
NO.
Ratio It may occur that the Court has jurisdiction to take cognizance of a particular case, which means that the matter
involved is also judicial in character. However, if the case is such that its determination requires the expertise,
specialized skills and knowledge of the proper administrative bodies because technical matters or intricate questions
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of facts are involved, then relief must first be obtained in an administrative proceeding before a remedy will be
supplied by the courts even though the matter is within the proper jurisdiction of a court. This is the doctrine of
primary jurisdiction. It applies "where a claim is originally cognizable in the courts, and comes into play
whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme, have
been placed within the special competence of an administrative body, in such case the judicial process is
suspended pending referral of such issues to the administrative body for its view".
Reasoning While the action filed by IEI sought the rescission of what appears to be an ordinary civil contract
cognizable by a civil court, the fact is that the Memorandum of Agreement sought to be rescinded is derived from a
coal-operating contract and is inextricably tied up with the right to develop coal-bearing lands and the determination
of whether or not the reversion of the coal operating contract over the subject coal blocks to IEI would be in line with
the integrated national program for coal-development and with the objective of rationalizing the country's over-all
coal-supply-demand balance, IEI's cause of action was not merely the rescission of a contract but the reversion or
return to it of the operation of the coal blocks. Thus it was that in its Decision ordering the rescission of the
Agreement, the Trial Court, inter alia, declared the continued efficacy of the coal-operating contract in IEI's favor and
directed the BED to give due course to IEI's application for three (3) IEI more coal blocks. These are matters properly
falling within the domain of the BED.
For the BED, as the successor to the Energy Development Board (abolished by Sec. 11, P.D. No. 1206, dated 6
October 1977) is tasked with the function of establishing a comprehensive and integrated national program for the
exploration, exploitation, and development and extraction of fossil fuels, such as the country's coal resources;
adopting a coal development program; regulating all activities relative thereto; and undertaking by itself or through
service contracts such exploitation and development, all in the interest of an effective and coordinated development
of extracted resources.
Clearly, the doctrine of primary jurisdiction finds application in this case since the question of what coal areas should
be exploited and developed and which entity should be granted coal operating contracts over said areas involves a
technical determination by the BED as the administrative agency in possession of the specialized expertise to act on
the matter. The Trial Court does not have the competence to decide matters concerning activities relative to the
exploration, exploitation, development and extraction of mineral resources like coal. These issues preclude an initial
judicial determination. It behooves the courts to stand aside even when apparently they have statutory power to
proceed in recognition of the primary jurisdiction of an administrative agency.
The application of the doctrine of primary jurisdiction, however, does not call for the dismissal of the case below. It
need only be suspended until after the matters within the competence of the BED are threshed out and determined.
Thereby, the principal purpose behind the doctrine of primary jurisdiction is salutarily served.
Disposition the Court Resolved to DENY the petition.

CONRAD AND CO v CA (Fitrite and Victoria Biscuit)


246 SCRA 691
VITUG; July 18, 1995

FACTS:
-FITRITE INC and VICTORIA biscuit co (respondents) are owners of the trademark “SUNSHINE” granted by the
Bureau of Patents, Trademarks and Technology Transfer (BPTTT). Respondents, sister local companies, engaged in
the business of manufacturing, selling and distributing Sunshine Biscuits.
-respondents found out that Conrad and Co had been importing, selling and distributing biscuits and cookies, and
other food items bearing this trademark in the Philippines. Although CONRAD had never before been engaged in the
importation, sale and distribution of products similar to those of plaintiffs, CONRAD was suddenly designated
exclusive importer and dealer of the products of "Sunshine Biscuits, Inc." (apparently, an international trademark for
“Sunshine Biscuits” was already in existence) for sale in the Philippine market.
-a case for "Injunction with Damages with Prayer for Preliminary Injunction" against Conrad was filed. Conrad
opposed this stating the court has no jurisdiction due to a pending case before the BPTTT filed by Sunshine America
against herein respondents for the cancellation of trademark.
-trial court ruled for Conrad and dismissed the case due to lack of jurisdiction. CA reversed stating that the cause of
action in the injunction case and in the cancellation case were different. CA ordered the continuation of the case
before the RTC.

ISSUE:
WON trial court has jurisdiction over the injunction case pending a cancellation of patent case before the BPTTT.

HELD:
NO.
Conrad contends that:
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-the doctrine of primary jurisdiction should be made to apply in this case considering that the BPTTT had already
acquired jurisdiction over the suit brought by defendant's principal against the plaintiffs involving the right of plaintiffs
to use said trademark. No doubt the BPTTT is better situated, considering its experience and special knowledge to
determine the matters of fact involved.
-"Petitions for Cancellation" of Fitrite's Certificate of Registration with BPTTT cast a cloud of doubt on private
respondents' claim of ownership and exclusive right to the use of the trademark "Sunshine." Considering that this
matter is at issue before the BPTTT, which has primary jurisdiction over the case, petitioner argues, an injunctive
relief from any court would be precipitate and improper.
However, the SC affirmed CA in saying that :
The issue involved in the action a quo is not whether the "SUNSHINE" trademark in question is registerable or
cancelable since the trademark has already been registered in both the Supplemental and Principal Registers of
BPTTT in the name of FITRITE; actually, the issue involved in the action a quo is whether CONRAD's acts of
importing, selling and distributing biscuits, cookies and other food items bearing said registered "SUNSHINE"
trademark in the Philippines without the consent of its registrant (FITRITE) constitute infringement thereof in
contemplation of Sec. 22 of Republic Act No. 166, as amended.
-But, even assuming — which is not the case — that the issue involved here is technical in nature requiring
specialized skills and knowledge, still Industrialized Enterprises does not authorize the outright dismissal of a case
originally cognizable in the courts; what it says is where primary jurisdiction comes into play in a case "the judicial
process is suspended pending referral of such issues to the administrative body for its view.
-an action for infringement or unfair competition, as well as the remedy of injunction and relief for damages, is
explicitly and unquestionably within the competence and jurisdiction of ordinary courts.

PHILIPPINE VETERANS BANK V. CA


G.R. No. 132767
Mendoza:January 18, 2000

FACTS:
- Petitioner Philippine Veterans Bank owned four parcels of land in Tagum, Davao. The lands were taken by the
Department of Agrarian Reform for distribution to landless farmers pursuant to the Comprehensive Agrarian Reform
Law (R.A. No. 6657). Dissatisfied with the valuation of the land made by respondents Land Bank of the Philippines
and the Department of Agrarian Reform Adjudication Board (DARAB), petitioner filed a petition for a determination of
the just compensation for its property.
- The petition was filed on January 26, 1994 with the Regional Trial Court, Branch 2, Tagum, Davao, which on
February 23, 1995, dismissed the petition on the ground that it was filed beyond the 15-day reglementary period for
filing appeals from the orders of the DARAB.
- On appeal to the Court of Appeals, the decision was affirmed. It was held that jurisdiction over land valuation cases
is lodged in the Department of Agrarian Reform Adjudication Board, as is plainly provided under Rule II of the DARAB
Revised Rules of Procedure.
- In pursuance thereof, it is clear that the right of a landowner who disagrees with the valuation fixed by the DAR to
file a petition for the judicial fixing of just compensation before special agrarian courts must be exercised within the
period provided in Rule XIII, Section 11.1
- In this case, appellant neither gives information regarding the date of its receipt of the questioned Order of the DAR
Provincial Adjudicator, nor disputes the conclusion made by the trial court
- Petitioner filed MFR, but its motion was likewise denied.

ISSUE:
WON the petition for judicial fixing of just compensation be filed within the period provided in Rule XIII, Sec. 11 of the
DARAB Rules of Procedure

HELD:
YES
Reasoning Petitioner argues that DAR adjudicators have no jurisdiction to determine the just compensation for the
taking of lands under the Comprehensive Agrarian Reform Program, because such jurisdiction is vested in Regional
Trial Courts designated as Special Agrarian Courts and, therefore, a petition for the fixing of just compensation can
be filed beyond the 15-day period of appeal provided from the decision of the DAR adjudicator.
- On the other hand, respondents argue that actions for the fixing of just compensation must be filed in the
appropriate courts within 15 days from receipt of the decision of the DAR adjudicator, otherwise such decision
becomes final and executory, pursuant R.A. No. 6657.
- The pertinent provisions of R.A. No. 6657 provides:
Sec. 50 Quasi-Judicial Power of the DAR
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The DAR is hereby vested with primary jurisdiction to determine and adjudicate agrarian reform matters involving the
implementation of agrarian reform, except those falling under the exclusive jurisdiction of the Department of
Agriculture (DA) and the Department of Environment and Natural Resources (DENR)
Sec. 57 Special Jurisdiction
The Special Agrarian Courts shall have original and exclusive jurisdiction over all petitions for the determination of
just compensation to landowners, and the prosecution of all criminal offenses under this Act. The Rules of Court shall
apply to all proceedings before the Special Agrarian Courts, unless modified by this Act.
The Special Agrarian Courts shall decide all appropriate cases under their special jurisdiction within thirty (30) days
from submission of the case for decision.
- Under R.A. No. 6657, the Land Bank of the Philippines is charged with the preliminary determination of the value of
lands placed under land reform program and the compensation to be paid for their taking. It initiates the acquisition of
agricultural lands by notifying the landowner of the government's intention to acquire his land and the valuation of the
same as determined by the Land Bank. Within 30 days from receipt of notice, the landowner shall inform the DAR of
his acceptance or rejection of the offer. In the event the landowner rejects the offer, a summary administrative
proceeding is held by the provincial (PARAD), the regional (RARAD) or the central (DARAB) adjudicator, as the case
may be, depending on the value of the land, for the purpose of determining the compensation for the land. The
landowner, the Land Bank, and other interested parties are then required to submit evidence as to the just
compensation for the land. The DAR adjudicator decides the case within 30 days after it is submitted for decision. If
the landowner finds the price unsatisfactory, he may bring the matter directly to the appropriate Regional Trial Court.
- To implement R.A. No. 6657, Rule XIII, Sec. 11 of the DARAB Rules of Procedure provides: Land Valuation
Determination and Payment of Just Compensation. The decision of the Adjudicator on land valuation and preliminary
determination and payment of just compensation shall not be appealable to the Board but shall be brought directly to
the Regional Trial Courts designated as Special Agrarian Courts within15 days from receipt of the notice thereof. Any
party shall be entitled to only one motion for reconsideration.

D. STANDING TO CHALLENGE

URSAL V CTA
101 PHIL 209
BENGZON; April 26, 1957

FACTS
- Ursal is the City Assessor of Cebu. In the exercise of his powers, he assessed for taxation certain real properties of
Consuelo Noel and Jesusa Samson in the City of Cebu. The taxpayers protested and the Cebu Board of Assessment
Appeals reduced the assessments. Ursal took the matter to the Court of Tax Appeals insisting on his valuation, but
said Court refused to entertain the appeal saying it was late, and that the assessor had no personality to bring the
matter before it under section 11 of Republic Act No. 1125, which reads as follows:
"SEC. 11. Who may appeal; effect of appeal. - Any person, association or corporation adversely affected by a
decision or ruling of the Collector of Internal Revenue, the Collector of Customs or any provincial or city Board of
Assessment Appeals may file an appeal in the Court of Tax Appeals within thirty days after the receipt of such
decision or ruling."

ISSUE
WON the city assessor has personality to resort to the CTA

HELD
NO
- The rulings of the Board of Assessment Appeals did not "adversely affect" him. At most it was the City of Cebu that
had been adversely affected in the sense that it could not thereafter collect higher realty taxes from the
abovementioned property owners. His opinion, it is true had been overruled; but the overruling indicted no material
damage upon him or his office. The Court of Tax Appeals was not created to decide conflicts of opinion between
administrative officers or agencies.
- The appellant invites attention to the fact that the Court of Tax Appeals is the successor of the former Central Board
of Tax Appeals created by Commonwealth Act No. 530 and of the Board of Tax Appeals established by Executive
Order No. 401-A, and that said Commonwealth Act No. 530 (section 2) explicitly authorized the city assessor to
appeal to the Central Board of Tax Appeals. Here is precisely another argument against his position: as Republic Act
No. 1125 failed to reenact such express permission, it is deemed withheld.
- Oversight could not have been the cause of such withholding, since there were proper grounds: (a) discipline and
command responsibility in the executive branches; and (b) instead of being another superior administrative agency as
was the former Board of Tax Appeals the Court of Tax Appeals as created by Republic Act No. 1125 is a part of the
judicial system presumably to act only on protests of private persons adversely affected by the tax, custom, or
assessment.
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ACTING COLLECTOR v CTA

The Acting Collector of Customs, petitioner, vs. The Court of Tax Appeals, and The Commissioner of Customs,
respondents. Philippine Education Co., Inc., intervenor-respondent.
Date: 31 October 1957
Ponente: Felix, J.

Facts:
 Philippine Education Co., Inc. (PECOI, intervenor-respondent) imported 1,463 copies of the October 1953 issue
of “Pageant” magazine which contained in it an article by Laura Berquist entitled “Check Your Sex-Life Against
the New Kinsey Report,” with quotations and excerpts from “The Sexual Behavior of the Human Female” by Dr.
Alfred Kinsey.
 The Collector of Customs, acting upon the recommendation of the Board of Censors of the Bureau of Customs,
decided to hold, seize, forfeit and burn the magazines for allegedly violating Sec.3-(b) of the Philippine Tariff Act
of 1909 prohibiting the entry of obscene and indecent reading materials in the Philippines.
 PECOI then appealed to the Commissioner of Customs (respondent) which reversed the Collector’s decision,
holding that the magazine “Pageant” did not contain obscene or indecent article.
 Upon receipt of a copy of the Commissioner’s decision, the Secretary of Finance caused the transmittal of the
record of the case to the Court of Tax Appeals (CTA, respondent) for review but the latter court did not take
cognizance of said case, claiming that it cannot and need not review the Commissioner’s decision motu proprio
but only upon filing of a formal petition for review by the person, association or corporation adversely affected by
the decision sought to be reviewed.
 The Acting Collector of Customs (petitioner, upon direction of the Secretary of Finance) then filed a petition for
review before the CTA assailing the Commissioner’s reversal of his prior decision.
 Commissioner (as respondent before the CTA) and PECOI (as intervenor): the Acting Collector of Customs lacks
the legal capacity to appeal under Sec.11 of RA 1125.
 CTA: dismissed the petition only persons, associations or corporations whose pecuniary and proprietary interests
are adversely affected by a decision of the Customs Commissioner may appeal before the CTA.
 Hence, this petition.

Issue: WON the Collector of Customs may appeal the decision of the Commissioner of Customs before the CTA.
Held: No. CTA resolution affirmed. Petition dismissed. CTA has no jurisdiction over the case and (topical) petitioner
has no standing to appeal.
Ratio:
 The legislative intent behind the creation of the CTA was to create an agency that will review tax cases and at
the same time to expedite the collection of taxes.
 Also, in RA 1125, Sec.7 wherein the CTA’s jurisdiction was conferred, it its (2), the clause “or other matters
arising under the Customs Law or other law or part of law administered by the Bureau of Customs” comes after
an enumeration of the class of cases cognizable by the CTA, namely, those involving liability for customs duties,
fees or other money charges. Thus, said clause (in quotation marks), by virtue of ejusdem generis, must be
construed to involve also those concerning liability for customs duties, fees or other money charges. The issue in
the case however, indisputably does not involve liability for customs duties, fees or other money charges.
 As a corollary, there are cases decided by the Commissioner of Customs arising under the Customs Law or
other law or part of law administered by the Bureau of Customs that cannot be subjected to the review by the
CTA.
 Further, Sec.3-(b) of the Philippine Tariff Act of 1909 relied upon by the Collector of Customs merely prohibits the
importation obscene or indecent printed matter but does not provide for said materials’ seizure or destruction.
Sec.1363 of the Revised Administrative Code enumerates merchandise or properties subject of seizure under
the Customs Law but it does not provide for the seizure of obscene or indecent materials.
 *(TOPICAL) RA 1125 became very specific when it gave an enumeration of those who may appeal from a
decision or ruling of the Commissioner of Customs and in its Sec.118, the right to appeal is allowed only to
persons, associations or corporations adversely affected by the decision of said official. Following “inclusio unius
est exclusio alterius,” the Government is not one of those granted said right.

8
Sec.11. Who may Appeal; Effect of Appeal.- Any person, association or corporation adversely affected by a decision or ruling of the
x x x Collector or Customs (Commissioner) x x x may file an appeal in the Court of Tax Appeals within thirty days after the receipt of
such decision or ruling.
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 *It also must be noted that the appeal was brought in the name of the Acting Collector of Customs as against his
superior the Acting Commissioner of Customs. Hence, the Court found itself in a precarious situation and the
fallacy of an appeal by the Government against its own ruling.
 The provisions of the Administrative Code pertaining to the bringing of cases to the court for revision may be
deemed repealed insofar as they refer to cases within the CTA’s jurisdiction, under RA 1125, the later legislation.
 The Court also added that the Commissioner of Customs is part of the Government and the remedy against his
decisions should be bought administratively rather than in the Judiciary.

Concepcion, J., concurring,


 The words “any person, association or corporation adversely affected” in RA 1125, Sec.11 do not adequately
indicate that either the Collector of Customs or the Secretary of Finance may interpose the appeal, as contrasted
to Sec.18 referring to “any party adversely” affected, differently worded, which strongly suggests the inclusion of
the Government in said section but not in Sec.11.
 The reason why the right to appeal in Sec.11 was not provided to the Government was because it, through the
Secretary of Finance, in the exercise of his power of control as an agent of the President, may correct such
errors as the Commissioner of Customs may have committed.

Montemayor, J., dissenting,


 The CTA has appellate jurisdiction over decisions of the Commissioner of Customs in cases involving seizure,
forfeiture and confiscation, even when not connected with customs duties, fees or other money charges
 The Collector of Customs may not appeal the decision of the Commissioner of Customs but his appeal was in
reality an appeal by the Government (the real appellant) or the Republic of the Philippines as the controversy at
issue was with respect to the seizure and confiscation of the magazines involving the Government and PECOI.
 Depriving the Government or the Department Head to appeal decisions of the Commissioner of Customs would
deprive the former of the power to modify, change or reverse any decision of the Commissioner who, even in all
good faith, may have committed a serious error or blunder in deciding a case.
 The difference in the phraseology between Secs.11 and 18 of RA 1125 was due to mere oversight or inadequacy
in phraseology and hence the Government cannot be said to be deprived of the right to appeal under Sec.11.

- Aboy Bayalan -

LOZADA (IGOT) v COMELEC


120 SCRA 337
De Castro ; 1983 January 27

FACTS
- Petitioner Lozada claims that he is a taxpayer and a bonafide elector of Cebu City and a transient voter of Quezon
City, Metro Manila, who desires to run for the position in the Batasan Pambansa; while petitioner Romeo B. Igot
alleges that, as a tax payer, he has standing to petition by mandamus the calling of a special election as mandated by
the 1973 Constitution. As reason for their petition, petitioners allege that they are ". . . deeply concerned about their
duties as citizens and desirous to uphold the constitutional mandate and rule of law . . ."; that they have filed the
instant petition "on their own and in behalf of all other Filipinos since the subject matters are of profound and general
interest." It is actually the inaction of the COMELEC to call a special election.

Issues
1. WON peitioners may file the instant petition
2.WON SC has jurisdiction over the COMELEC
3. WON the said provision applies to the Interim National Assembly

Held
1. No.
- As taxpayers, petitioners may not file the petition, for nowhere therein is it alleged that tax money is being illegally
spent. The act complained of is the inaction of the COMELEC to call a special election, as is allegedly its ministerial
duty under the constitutional provision abovecited, and therefore, involves no expenditure of public funds. It is only
when an act complained of, which may include a legislative enactment or statute, involves the illegal expenditure of
public money that the so-called taxpayer suit may be allowed. What the case at bar seeks is one that entails
expenditure of public funds which may be illegal because it would be spent for a purpose - that of calling a special
election - which, as will be shown, has no authority either in the Constitution or a statute.
- the alleged inaction of the COMELEC to call a special election to fill-up the existing vacancies in the Batasan
Pambansa, standing alone, would adversely affect only the generalized interest of all citizens. Petitioners' standing to
sue may not be predicated upon an interest of the kind alleged here, which is held in common by all members of the
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public because of the necessarily abstract nature of the injury supposedly shared by all citizens. Concrete injury,
whether actual or threatened, is that indispensable element of a dispute which serves in part to cast it in a form
traditionally capable of judicial resolution. When the asserted harm is a "generalized grievance" shared in
substantially equal measure by all or a large class of citizens, that harm alone normally does not warrant exercise of
jurisdiction.
2. The Supreme Court's jurisdiction over the COMELEC is only to review by certiorari the latter's decision, orders or
rulings. This is as clearly provided in Article XII-C, Section 11 of the New Constitution which reads:
"Any decision, order, or ruling of the Commission may be brought to the Supreme Court on certiorari by the aggrieved
party within thirty days from his receipt of a copy thereof."
- There is in this case no decision, order or ruling of the COMELEC which is sought to be reviewed by this Court
under its certiorari jurisdiction as provided for in the aforequoted provision, which is the only known provision
conferring jurisdiction or authority on the Supreme Court over the COMELEC. It is not alleged that the COMELEC
was asked by petitioners to perform its alleged duty under the Constitution to call a special election, and that
COMELEC has issued an order or resolution denying such petition.
- Even from the standpoint of an action for mandamus, with the total absence of a showing that COMELEC has
unlawfully neglected the performance of a ministerial duty, or has refused on being demanded, to discharge such a
duty; and as demonstrated above, it is not shown, nor can it ever be shown, that petitioners have a clear right to the
holding of a special election which is equally the clear and ministerial duty of COMELEC to respect, mandamus will
not lie. 5 The writ will not issue in doubtful cases.
- It is obvious that the holding of special elections in several regional districts where vacancies exist, would entail
huge expenditure of money. Only the Batasan Pambansa can make the necessary appropriation for the purpose, and
this power of the Batasan Pambansa may neither be subject to mandamus by the courts much less may COMELEC
compel the Batasan to exercise its power of appropriation. From the role Batasan Pambansa has to play in the
holding of special elections, which is to appropriate the funds for the expenses thereof, it would seem that the
initiative on the matter must come from said body, not the COMELEC, even when the vacancies would occur in the
regular not interim Batasan Pambansa. The power to appropriate is the sole and exclusive prerogative of the
legislative body, the exercise of which may not be compelled through a petition for mandamus. What is more, the
provision of Section 5(2), Article VIII of the Constitution was intended to apply to vacancies in the regular National
Assembly, now Batasan Pambansa, not to the Interim Batasan Pambansa, as will presently be shown.
3. No.
- The Interim National Assembly was to be composed by the delegates to the Constitutional Convention, as well as
the then incumbent President and Vice-President, and the members of the Senate and House of Representatives of
Congress under the 1935 Constitution. With such number of representatives representing each congressional district,
or a province, not to mention the Senators, there was felt absolutely no need for filing vacancies occurring in the
Interim National Assembly, considering the uncertainty of the duration of its existence. What was in the mind of the
Constitutional Convention in providing for special elections to fill up vacancies is the regular National Assembly,
because a province or representative district would have only one representative in the said National Assembly. Even
as presently constituted where the representation in the Interim Batasan Pambansa is regional and sectoral, the need
to fill up vacancies in the Body is neither imperative nor urgent. No district or province would ever be left without
representation at all, as to necessitate the filling up of vacancies in the Interim Batasan Pambansa. There would
always be adequate representation for every province which only forms part of a certain region, specially considering
that the Body is only transitory in character. The unmistakable intent of the Constitutional Convention as adverted to
is even more positively revealed by the fact that the provision of Section 5(2) of Article VIII of the New Constitution is
in the main body of the said Constitution, not in the transitory provisions in which all matters relating to the Interim
Batasan Pambansa are found. No provision outside of Article VIII on the "Transitory Provisions" has reference or
relevance to the Interim Batasan Pambansa. Also under the original provision of the Constitution (Section 1, Article
XVII - Transitory Provisions), the Interim National Assembly had only one single occasion on which to call for an
election, and that is for the election of members of the regular National Assembly. The Constitution could not have at
that time contemplated to fill up vacancies in the Interim National Assembly the composition of which, as already
demonstrated, would not raise any imperious necessity of having to call special elections for that purpose, because
the duration of its existence was neither known or pre-determined. It could be for a period so brief that the time
prescriptions mentioned in Section 5(2), Article VIII of the Constitution cannot be applicable. The foregoing
observations make it clear that the aforementioned provision for calling special elections to fill up vacancies apply
only to the regular Batasan Pambansa. This is evident from the language thereof which speaks of a "vacancy in the
Batasan Pambansa," which means the regular Batasan Pambansa as the same words "Batasan Pambansa" found in
all the many other sections of Article VIII, undoubtedly refer to the regular Batasan, not the interim one. A word or
phrase used in one part of a Constitution is to receive the same interpretation when used in every other part, unless it
clearly appears, from the context or otherwise, that a different meaning should be applied.

OPOSA V FACTORAN
224 SCRA 792
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DAVIDE JR; JULY 30, 1993

FACTS
- In 1991 a case was filed by minors (represented by their parents) and the Philippine Ecological Network (PENI)
against the then Secretary of the Department of Environment and Natural Resources (DENR), Fulgencio Factoran, Jr.
who was substituted by the new secretary, Angel Alcala. The complaint was instituted to be a taxpayer’s class suit as
it alleges that all citizen’s of the Philippines are entitled to benefit, use and enjoyment of the country’s virgin tropical
rainforests. The suit also alleges that this suit represents people who are sharing the same sentiment towards the
preservation of our natural resources (since not all of them could go before the court). Furthermore, this was also
asserted to be representative of the current generation and generation that are yet to be born.
- The suit calls for two primary actions that orders the Department of Environment and Natural Resources (DENR), its
agents, representatives, and those acting on its behalf to, 1. Cancel all existing timber license agreements in the
country and 2. to cease and desist from receiving, accepting, processing, and renewing or approving new timber
license agreements. .
- The petition was dismissed on the grounds of lack of cause of action, of being political question, and of causing the
impairment of contracts. The petitioners filed for certiorari hence this case. They contend that there is a cause of
action using articles 19, 20, and 21 of the Civil Code (the right to a sound environment), Section 4 of Executive Order
No. 192 that calls for the creation of the Department of Environment and Natural Resources (DENR) to safeguard the
people’s right to a healthful environment, Section 3 of Presidential Decree No. 1151 ( Philippine Environmental
Policy), and Section 16, Article II of the 1987 Constitution that recognizes the right of the people to a balanced and
healthful ecology. As well as the concept of generational genocide in Criminal Law and the concept of man’s
inalienable right to self-preservation and self-perpetuation in natural law.

ISSUE
WON the petitioners have standing

HELD
YES. The civil case is a class suit
Reasoning The subject matter of the complaint is of common and general interest not just to several, but to all
citizens of the Philippines. Consequently, since the parties are so numerous, it, becomes impracticable, if not totally
impossible, to bring all of them before the court. We likewise declare that the plaintiffs therein are numerous and
representative enough to ensure the full protection of all concerned interests. Hence, all the requisites for the filing of
a valid class suit under Section 12, Rule 3 of the RoC.
- 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. 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.

JOYA v PCGG

FACTS:
 PCGG,representing the Republic of the Philippines, signed the Consignment Agreement with Christie's of New
York. According to the agreement, PCGG shall consign to CHRISTIE'S for sale at public auction the eighty-two
(82) Old Masters Paintings then found at the Metropolitan Museum of Manila as well as the silverware contained
in seventy-one (71) cartons in the custody of the Central Bank of the Philippines, and such other property as may
subsequently be identified by PCGG and accepted by CHRISTIE'S to be subject to the provisions of the
agreement.
 Hence, this petition originally filed on 7 January 1991 by Dean Jose Joya, Carmen Guerrero Nakpil, Armida
Siguion Reyna, Prof. Ricarte M. Puruganan, Irma Potenciano, Adrian Cristobal, Ingrid Santamaria, Corazon Fiel,
Ambassador E. Aguilar Cruz, Florencio R. Jacela, Jr., Mauro Malang, Federico Aguilar Alcuaz, Lucrecia R.
Urtula, Susano Gonzales, Steve Santos, Ephraim Samson, Soler Santos, Ang Kiu Kok, Kerima Polotan, Lucrecia
Kasilag, Ligaya David Perez, Virgilio Almario and Liwayway A. Arceo. All thirty-five (35) petitioners in this Special
Civil Action for Prohibition and Mandamus with Prayer for Preliminary Injunction and/or Restraining Order seek to
enjoin the Presidential Commission on Good Government (PCGG) from proceeding with the auction sale
scheduled on 11 January 1991 by Christie's of New York of the Old Masters Paintings and 18th and 19th century
silverware seized from Malacañang and the Metropolitan Museum of Manila and placed in the custody of the
Central Bank.
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 SC: issued immediately esolution denying the application for preliminary injunction to restrain the scheduled sale
of the artworks on the ground that petitioners had not presented a clear legal right to a restraining order and that
proper parties had not been impleaded.
 The sale at public auction proceeded as scheduled and the proceeds of $13,302,604.86 were turned over to the
Bureau of Treasury.
Petitioners' Contentention: that as Filipino citizens, taxpayers and artists deeply concerned with the preservation
and protection of the country's artistic wealth, they have the legal personality to restrain respondents Executive
Secretary and PCGG from acting contrary to their public duty to conserve the artistic creations as mandated by the
1987 Constitution, particularly Art. XIV, Secs. 14 to 18, on Arts and Culture, and R.A. 4846 known as "The Cultural
Properties Preservation and Protection Act," governing the preservation and disposition of national and important
cultural properties. Petitioners also anchor their case on the premise that the paintings and silverware are public
properties collectively owned by them and by the people in general to view and enjoy as great works of art. They
allege that with the unauthorized act of PCGG in selling the art pieces, petitioners have been deprived of their right to
public property without due process of law in violation of the Constitution.

TOPICAL ISSUE: WON the instant petition complies with the legal requisites for this Court to exercise its power of
judicial review over this case.

HELD: No. Petitioners have no standing.


1.
 Petitioners' arguments are devoid of merit. They lack basis in fact and in law. They themselves allege that
the paintings were donated by private persons from different parts of the world to the Metropolitan Museum
of Manila Foundation, which is a non-profit and non-stock corporations established to promote non-
Philippine arts. The foundation's chairman was former First Lady Imelda R. Marcos, while its president was
Bienvenido R. Tantoco. On this basis, the ownership of these paintings legally belongs to the foundation or
corporation or the members thereof, although the public has been given the opportunity to view and
appreciate these paintings when they were placed on exhibit. Having failed to show that they are the legal
owners of the artworks or that the valued pieces have become publicly owned, petitioners do not possess
any clear legal right whatsoever to question their alleged unauthorized disposition.
The rule is settled that no question involving the constitutionality or validity of a law or governmental act may be heard
and decided by the court unless there is compliance with the legal requisites for judicial inquiry, namely: that the
question must be raised by the proper party; that there must be an actual case or controversy; that the question must
be raised at the earliest possible opportunity; and, that the decision on the constitutional or legal question must be
necessary to the determination of the case itself. But the most important are the first two (2) requisites.
On the first requisite, it has been held that one having no right or interest to protect cannot invoke the jurisdiction of
the court as party-plaintiff in an action. This is premised on Sec. 2, Rule 3, of the Rules of Court which provides that
every action must be prosecuted and defended in the name of the real party-in-interest, and that all persons having
interest in the subject of the action and in obtaining the relief demanded shall be joined as plaintiffs. The Court will
exercise its power of judicial review only if the case is brought before it by a party who has the legal standing to raise
the constitutional or legal question. "Legal standing" means a personal and substantial interest in the case such that
the party has sustained or will sustain direct injury as a result of the governmental act that is being challenged. The
term "interest" is material interest, an interest in issue and to be affected by the decree, as distinguished from mere
interest in the question involved, or a mere incidental interest. Moreover, the interest of the party plaintiff must be
personal and not one based on a desire to vindicate the constitutional right of some third and related party.

2.
Further, although this action is also one of mandamus filed by concerned citizens, it does not fulfill the criteria for a
mandamus suit. In Legaspi v. Civil Service Commission, this Court laid down the rule that a writ of mandamus may be
issued to a citizen only when the public right to be enforced and the concomitant duty of the state are unequivocably
set forth in the Constitution. In the case at bar, petitioners are not after the fulfillment of a positive duty required of
respondent officials under the 1987 Constitution. What they seek is the enjoining of an official act because it is
constitutionally infirmed. Moreover, petitioners' claim for the continued enjoyment and appreciation by the public of
the artworks is at most a privilege and is unenforceable as a constitutional right in this action for mandamus.

3.
Neither can this petition be allowed as a taxpayer's suit. A taxpayer's suit can prosper only if the governmental acts
being questioned involve disbursement of public funds upon the theory that the expenditure of public funds by an
officer of the state for the purpose of administering an unconstitutional act constitutes a misapplication of such funds,
which may be enjoined at the request of a taxpayer. Obviously, petitioners are not challenging any expenditure
involving public funds but the disposition of what they allege to be public properties. It is worthy to note that
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petitioners admit that the paintings and antique silverware were acquired from private sources and not with public
money.

4.
Anent the second requisite of actual controversy, petitioners argue that this case should be resolved by this Court
as an exception to the rule on moot and academic cases; that although the sale of the paintings and silver has long
been consummated and the possibility of retrieving the treasure trove is nil, yet the novelty and importance of the
issues raised by the petition deserve this Court's attention.
Court held that there is, however, no such justification in the petition at bar to warrant the relaxation of the rule.
For a court to exercise its power of adjudication, there must be an actual case of controversy — one which involves a
conflict of legal rights, an assertion of opposite legal claims susceptible of judicial resolution; the case must not be
moot or academic or based on extra-legal or other similar considerations not cognizable by a court of justice. A case
becomes moot and academic when its purpose has become stale, such as the case before us. Since the purpose of
this petition for prohibition is to enjoin respondent public officials from holding the auction sale of the artworks on a
particular date — 11 January 1991 — which is long past, the issues raised in the petition have become moot and
academic.

- Welga Carrasco

KILOSBAYAN v GUINGONA, JR
232 SCRA 110
DAVIDE, JR; May 5, 1994

FACTS
- Petitioner KILOSBAYAN is a non-stock domestic corporation composed of civic-spirited citizens, pastors, priests,
nuns and lay leaders who are committed to the cause of truth, justice and national renewal. The rest of the petitioners
(except Webb, Tañada, Joker Arroyo, who are suing as members of Congress and taxpayers) are suing in their
capacities as members of the Board of Trustees of KILOSBAYAN and as taxpayers and concerned citizens.
- Pursuant to the charter of PCSO which grants it authority to hold and conduct “charity sweepstakes races, lotteries
and other similar activities,” PCSO decided to establish an online lottery system to increasee its revenue base and
diversifying its sources of funds.
- The Berjaya Group Berhad from Malaysia engaged in successful lottery operations became interested to offer its
services to PCSO. As an initial step Berjaya Group organized with some Filipino investors a Philippine corporation
known as the Philippine Gaming Management Corporation (PGMC) which was intended to be the medium through
which the technical and management services required for the project would be offered and delivered to PCSO.
- Considering the citizenship requirement, the Berjaya Group undertook to reduce its equity stakes in PGMC to 40%
by selling 35% out of its original 75% foreign stockholdings to local investors.
- Oct. 21, 1993: the Office of the President announced that it had given PGMC the go-signal to operate the online
lottery system.
- Nov. 4, 1993: KILOSBAYAN sent an open letter to Pres. FVR strongly opposing the setting-up of the online lottery
on the basis of serious moral and ethical considerations.
Petitioners’ Claim
- PCSO cannot validly enter into the assailed Contract of Lease with the PGMC because it is an arrangement wherein
the PCSO would hold and conduct the lottery system in collaboration or association with the PGMC in violation of Sec
1(B) of RA 1169 which prohibits the PCSO from holding and conducting lotteries “in collaboration, association or joint
venture with any person, association, company or entity, foreign or domestic.
Respondents’ Comments
- PGMC asserts that it is merely an independent contractor for a piece of work, and as such independent contractor,
PGMC is not a ci0ioeratir of the lottery franchise with PCSO, nor is PCSO sharing its franchise in collaboration,
association or joint venture with PGMC.
- The issue on morality of lottery franchise granted to PCSO is political, not judicial or legal, which should be
ventilated in another forum.
- The petitioners do not appear to have the legal standing or the real interest in the subject contract and in obtaining
the relief sought.
- PCSO as a corporate entity is vested with the basic and essential prerogative to enter into all kinds of transactions
or contracts as may be necessary for the attainment of its purposes and objectives.

ISSUE
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1. WON the petitioners have legal standing9


2. WON Contract of Lease entered into by PCSO and PGMC is valid.

HELD
1. YES
Ratio In line with the liberal policy of the Court on locus standi, ordinary taxpayers, members of Congress, and even
association of planters, and non-profit civic organizations were allowed to initiate and prosecute actons before this
Court to question the constitutionality or validity of laws, acts, decisions, rulings or orders of various government
agencies or instrumentalities.
Reasoning A party’s standing before the SC is a procedural technicality which it may, in the exercise of its discretion
set aside in view of the importance of the issues raised.
- The rule is that the person who impugns the validity of a statute must have personal and substantial interest in the
case such that he has sustained or will sustain, direct injury as a result of its enforcement.
- Even if, strictly speaking, they are not covered by the definition, it is still within the wide discretion of the Court to
waive the requirement and so remove the impediment to its addressing and resolving the serious constitutional
questions raised.
- The instant petition is of transcendental importance to the public. The issues it raised are of paramount public
interest and of a category even higher than those involved in many of the mention cases. The ramifications of such
issues immeasurably affect the social, economic and moral well-being of the people in the remotest barangays of the
country and the counter-productive and retrogressive effects of the envisioned lottery system are as staggering as the
billions in pesos it is expected to raise.
2. NO
Sec 1 RA 1169
Sec. 1. The Philippine Charity Sweepstakes Office xxx shall have the authority:
A.To hold and conduct charity sweepstakes races, lotteries and other similar activities, in such frequency and
manner, as shall be determined, and subject to such rules and regulations as shall be promulgated by the Board of
Directors.
B.Subject to the approval of the Minister of Human Settlements, to engage in health and welfare-related
investments, programs, projects and activities which may be profit-oriented, by itself or in collaboration, association
or joint venture with any person, association, company or entity, whether domestic or foreign, except for the
activities mentioned in the preceding paragraph A.
- The language of the section is clear that the PCSO cannot exercise its privilege to hold and conduct charity
sweepstakes races, lotteries etc. in collaboration, association or joint venture with any party.
- By the exception explicitly made in paragraph B, Sec 1 of its charter, the PCSO cannot share its franchise with
another by way of collaboration, association or joint venture.
- The intention of the parties is the soul of the instrument. The arrangement between the parties would leave to the
PGMC the technical, operations and management aspects of the online lottery system while the PCSO would
primarily provide the franchise.
DISPOSITION The Contract of Lease violates the exception of Sec 1(B) of the PCSO charter, and is invalid for being
contrary to law.

SEPARATE OPINIONS
CRUZ, Concurring;
Concerning the doctrine of locus standi, Cruz cannot agree that out of the millions of Filipinos affected by the
proposed lottery, not a single solitary citizen can question the agreement. “It is not only the owner of the burning
house who has the right to call the firemen. Every one has the right and responsibility to prevent the fire from
spreading even if he lives in the other block.

FELICIANO, Concurring;
It is not enough for the Court simply to invoke “public interest” or even “paramount considerations of national interest,”
and to say that the specific requirements of such public interest can only be ascertained on a “case to case” basis.
Such an approach is not intellectually satisfying. And such an answer appears to come too close to saying that locus
standi exists whenever at least a majority of the Members of the SC participating in a case feel that an appropriate
case for judicial intervention has arisen.
- The funds or assets involved in the case are important. The funds are clearly public in nature. The funds to be
generated by the lottery are to be raised from the population at large, and are designed to benefit the general public.
The dissenters insist that because the funds will not have been generated by the exercise of the taxing power of
government, the present petition cannot be regarded as a taxpayer’s suit and must be disregarded. It is known that

9
There must be an actual case or controversy; the question of constitutionality must be raised by the proper party; the constitutional
question must be raised at the earliest possible time; the decision of the constitutionality must be necessary to the determination of
the case itself.
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the principal sources of funding for government operations today include not just taxes and customs duties, but also
revenues derived from activities of PAGCOR.

PADILLA, Separate Opinion;


The case falls within the De Guia doctrine (the Court may brush aside procedure if the case is of paramount interest).
When the contract of lease in question seeks to establish and operate a nationwide gambling network with substantial
if not controlling foreign participation, then the issue is of paramount national interest and importance as to justify and
warrant a relaxation of the above-mentioned procedural rule on locus standi.

MELO, Dissenting;
- Petitioners have no legal standing as taxpayers and members of Congress.
- No public fund raised by taxation is involved in this case. It is even doubtful if the rentals which the PCSO will pay to
the lessor for its operation of the lottery system may be regarded as public fund. The PCSO is not a revenue-
collecting arm of the government. The money it will raise shall remain with the corporation. It is public only insofar as
PCSO is a government-owned/ controlled entity.
- The contract does not involve the disbursement of public funds but of strictly corporate money.

PUNO, Dissenting;
- Courts are neither free to decide all kinds of cases dumped into their laps nor are they free to open their doors to all
parties or entities claiming a grievance.
- Not one of the petitioners is a party to the Contract of Lease executed between PCSO and PGMC. None of the
petitioners participated in the bidding, and hence they are not losing bidders. They are complete strangers to the
contract.
- Petitioners have no standing as taxpayers because the case does not involve any expenditure of public money on
the part of the PCSO.
- Puno suggests that the doctrine of De Guia be reviewed. It treated the rule on locus standi as a mere procedural
rule. It is not a plain procedural rule but a constitutional requirement derived from Sec 1 Art VIII of the Constitution
which mandates courts of justice to settle only “actual controversies involving rights which are legally demandable
and enforceable.” By downgrading the requirement on locus standi as a procedural rule which can be discarded in
the name of public interest, is in effect an amendment the Constitution by judicial fiat.

VITUG, Separate Opinion;


Petitioners assert that the lottery violates morals. However, “what evils should be corrected as pernicious to the body
politic, and how correction should be done, is a matter primarily addressed to the discretion of the legislative
department, not of the courts.”

KAPUNAN, Dissenting;
The petitioners have no personal stake in the case. The constitutional requirement for an actual case and controversy
limits this Court’s power of review to precisely those suits between adversary litigants with real interests at stake thus
preventing it from making all sorts of hypothetical pronouncement on abstract, contingent and amorphous issues. The
Court will therefore not pass upon the validity of an act of government or a statute passed by a legislative body
without a requisite showing of injury. A personal stake is essential, which absence renders our pronouncements
gratuitous and certainly violative of the constitutional requirement for actual cases and controversies.

KILOSBAYAN, INC., V MORATO


246 SCRA 540
MENDOZA; July 17, 1995

FACTS
-In Kilosbayan, Inc v. Guingona, 232 SCRA 110 (1994), SC invalidated the Contract of Lease between the PCSO and
the Philippine Gaming Management Corp. (PGMC) on the ground that it had been made in violation of the charter of
the PCSO. The parties entered into negotiations for a new agreement resulting in an Equipment Lease Agreement
(ELA) whereby the PGMC leased on-line lottery equipment and accessories to the PCSO in consideration of a certain
amount of rentals.
-Petitioners filed this suit seeking to declare the ELA invalid on the ground that it is substantially the same as the
Contract of Lease nullified in the first case. They allege that said ELA is violative of PCSO’s charter, of the SC
decision in the first case, of the Law on Public Bidding (EO 301 & 298), of COA Circular No. 85-55-A, and of Sec.
2(2), Art. IX-D of the 1987 Constitution.
-Respondents filed comments questioning the petitioners' standing to bring this suit.

ISSUE
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WON petitioners have legal standing to bring this suit


<For the discussion on the substantive issues (validity of the ELA, interpretation of Sec. 1 of RA 1169, requirement of
public bidding), please see the original.>

HELD
NO.
- Kilosbayan, Inc., its trustees and the petitioner-senators, not being parties to the contract of lease which they seek
to nullify, have no personal and substantial interest likely to be injured by the enforcement of the contract. The
previous ruling sustaining petitioners' intervention may itself be considered a departure from settled rulings on "real
parties in interest" because no constitutional issues were actually involved.
-Also, the voting on petitioners' standing in the previous case was a narrow one (7-6); majority was a tenuous one not
likely to be maintained in any subsequent litigation. In addition, there have been changes in the membership of the
Court, (Justices Cruz and Bidin have retired; and Justices Francisco and Mendoza are newly appointed).
-The doctrine of the law of the case does not apply. This may be a sequel to the first case, but it is certainly not its
continuation. The parties are the same but the cases are not.
-The doctrine of conclusiveness of judgment is also inapplicable because the issue is one of law, and the two actions
involve claims that are substantially unrelated. Hence the determination in the prior case that petitioners had standing
to challenge the validity of the 1993 Contract of Lease of the parties does not preclude determination of their standing
in the present suit.
-Strictly speaking, petitioners’ legal standing is not even an issue in this case since standing is a concept in
constitutional law and here no constitutional question is actually involved. The issue in this case is whether
petitioners are the "real parties in interest" within the meaning of Rule 3, Sec. 2 of the ROC.
In short: questions of constitutionality  legal standing
otherwise  real party in
interest
-This cannot be treated as taxpayer’s suit since there is no allegation that public funds are being misspent.
-Art. II, Sections 5, 12, 13 and 17 of the 1987 Constitution are not self executing provisions, the disregard of which
can give rise to a cause of action in the courts. They do not embody judicially enforceable constitutional rights but
guidelines for legislation. Thus, while constitutional policies are invoked, this case involves basically questions of
contract law.
-In actions for the annulment of contracts, such as this action, the real parties are those who are parties to the
agreement or are bound either principally or subsidiarily or are prejudiced in their rights with respect to one of the
contracting parties and can show the detriment which would positively result to them from the contract even though
they did not intervene in it, or who claim a right to take part in a public bidding but have been illegally excluded from it.
-These are parties with "a present substantial interest, as distinguished from a mere expectancy or future, contingent,
subordinate, or consequential interest. . . . The phrase 'present substantial interest' more concretely is meant such
interest of a party in the subject matter of action as will entitle him, under the substantive law, to recover if the
evidence is sufficient, or that he has the legal title to demand and the defendant will be protected in a payment to or
recovery by him."
Disposition Petition dismissed.
(1) petitioners have neither standing to bring this suit nor substantial interest to make them real parties in interest
(Rule 3, Sec 2);
(2) a determination of petitioners' right to bring this suit is not precluded or barred by the decision in the prior case
between the parties;
(3) the ELA of January 25, 1995 is valid as a lease contract under the Civil Code and is not contrary to the charter of
the PCSO;
(4) under Sec1(A) of R.A. 1169, the PCSO has authority to enter into a contract for the holding of an on-line lottery,
whether alone or in association, collaboration or joint venture with another party, so long as it itself holds or conducts
such lottery; and
(5) the ELA in question did not have to be submitted to public bidding as a condition for its validity.

SEPARATE OPINIONS
PADILLA, J., concurring:
-It is the duty of the Supreme Court to apply the laws enacted by Congress and approved by the President, (unless
they are violative of the Constitution) even if such laws run counter to a Member's personal conviction that gambling
should be totally prohibited by law.
-The rule on locus standi, being merely a procedural rule, should be relaxed, as when the issue is of paramount
national interest and importance. The core issue in the present case is the same as the issue in the first lotto case,
i.e., the validity of a changed agreement between PCSO and PGMC. Thus, it is my view that the principle of locus
standi should not stand in the way of a review by this Court of the validity of such changed agreement.

VITUG, J., concurring:


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-reiterates his separate opinion in Kilosbayan, Inc. vs. Guingona.


-The matter of the legal standing of petitioners in their suit assailing the subject-contract appears, both under
substantive law and the rules of procedure, to still be an insuperable issue. Art. VIII, Sec. 1, 1987 Consti has not been
intended to unduly mutate, let alone to disregard, the long established rules on locus standi. Neither has it been
meant to do away with the principle of separation of powers.

FELICIANO, J., dissenting:


-reiterates his concurring opinion in the first Kilosbayan case: All the factors which pressed for recognition of locus
standi on the part of petitioners in the first Kilosbayan case, still exist and demand, with equal weight and insistence,
such recognition in the present or second Kilosbayan case.

REGALADO, J., dissenting:


-In the first lotto case, the Court excepted petitioners from the traditional locus standi proscription because the issues
raised on the indiscriminate operation of a nationwide on-line lottery system are of paramount public interest and of a
category higher than those involved in former cases wherein the application of that rule was sustained. The court
acted correctly; creating exceptions to doctrines and even rejecting the same in the interest of justice are not unusual.
-Withal, the relaxation or the locus standi doctrine in the first lotto case is impugned and lamented in the second one
now at bar. In the first lotto case, the minority therein rested its position entirely on procedural grounds, that is, by
merely challenging the legal standing of petitioners but without any comment on the merits of the contract in question.
Since the case at bar is in truth a reprise of the first, I had expected that this case would now be decided purely on
the merits of the putative expanded lease agreement but the Court's judgment turn again on technical procedural
grounds, by hiding within the shroud of the locus standi mystique!
-Majority opinion says: petitioners are not parties to the contract  not real parties in interest  no cause of action 
no right of action  they cannot maintain the present petition.
-Minority says: Standing because of its constitutional and public policy underpinnings, is very different from questions
relating to whether a particular plaintiff is the real party in interest or has the capacity to sue. Although all three
requirements are directed towards ensuring that only certain parties can maintain an action, standing restrictions
require a partial consideration of the merits, as well as of broader policy concerns relating to the proper role of the
judiciary in certain areas.
-The matter of the right of petitioners to file and maintain this action – whether the objection thereto is premised on
lack of locus standi or right of action – has already been foreclosed by our judgment in the first lotto case. The
principles of "law of the case'' and res judicata are applicable.

DAVIDE, JR., J., dissenting:


NOTE: he is ponente of first Kilosbayan case and author of the exception to paragraph B, Section 1 of R.A. No. 1169,
as amended.
-disturbed by the sudden reversal of SC rulings in Kilosbayan, Inc. vs. Guingona and believes such reversal upsets
the salutary doctrines of the law of the case, res judicata, and stare decisis.
-In first Kilosbyan, SC sustained the locus standi of the petitioners, citing transcendental importance / paramount
public interest. The ramifications of such issues immeasurably affect the social, economic, and moral well-being of
the people even in the remotest barangays of the country and the counter-productive and retrogressive effects of the
envisioned on-line lottery system are as staggering as the billions of pesos its is expected to raise.
-The prevailing doctrines in taxpayer's suits are to allow taxpayers to question contracts entered into by the national
government or GOCCs allegedly in contravention of the law and to disallow the same when only municipal contracts
are involved. As long as the ruling in Kilosbayan on locus standi is not reversed, we have no choice but to follow it
and uphold the legal standing of petitioners as taxpayers to institute the present action.
-Under the principle of either the law of the case or res judicata, the PCSO and the PGMC are bound by the ruling in
the first lotto case on the locus standi of the petitioners and the application or interpretation of the exception clause in
par. B, Sec. 1 of R.A.1169, as amended. Moreover, that application or interpretation has been laid to rest under the
doctrine of stare decisis and has also become part of our legal system pursuant to Article 8 of the Civil Code.
-The legal question of locus standi which was resolved in favor of the petitioners in the first lotto case is the same in
this case and in every subsequent case which would involve contracts relating or incidental to the conduct or holding
of lotteries by the PCSO in collaboration, association, or joint venture with any person, association, company, or
entity. For one thing, the question of the petitioners' legal standing in the first lotto case and in this case is one and
the same issue of law. For another, these cases involve the same and not substantially unrelated subject matter, viz.,
the second contract between the PCSO and the PGMC on the operation of the on-line lottery system.
-It must be pointed out that the rule in ordinary civil procedure on real party in interest was never put in issue in the
previous case. It was the clear understanding of the Members of the Court that in the light of the issues raised and
the arguments adduced therein, only locus standi deserved consideration.
-Friedenthal; et al., whose book is cited in the majority opinion in its discussion of the rule on real party in interest and
the doctrine of locus standi, admit that there is a difference between the two, and that the former is not strictly
applicable in public law cases, thus: “It is important to note, however, that standing, because of its constitutional and
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public policy underpinnings, is very different from questions relating to whether a particular plaintiff is the real party in
interest or has capacity to sue. Although all three requirements are directed toward ensuring that only certain parties
can maintain an action, standing restrictions require a partial consideration of the merits, as well as of broader policy
concerns relating to the proper role of the judiciary in certain areas.” xxx In the realm of public law, the real party in
interest rule is not applicable.
-The attempt to use the real-party-in-interest rule is to resurrect the abandoned restrictive application of locus standi.
Such attempt directly or indirectly restricts the exercise of the judicial authority of this Court in an original action to
determine whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the Government. Only a very limited few may qualify, under the real-party-in-
interest rule, to bring actions to question acts or contracts tainted with such vice.
-Locus standi is not such an absolute rule that it cannot admit of exceptions under certain conditions or
circumstances like those attending this transaction.

KMU V GARCIA, JR
239 SCRA 386
KAPUNAN; December 23, 1994

FACTS
- Then Secretary of DOTC, Oscar M. Orbos, issued Memorandum Circular No. 90-395 to then LTFRB Chairman,
Remedios A.S. Fernando allowing provincial bus operators to charge passengers rates within a range of 15% above
and 15% below the LTFRB official rate for a period of one (1) year.
- Finding the implementation of the fare range scheme "not legally feasible," Remedios A.S. Fernando submitted
memorandum to Oscar M. Orbos suggesting that the implementation of the proposed fare range scheme be further
studied and evaluated.
- Respondent Provincial Bus Operators Association of the Philippines, Inc. (PBOAP) filed an application for fare rate
increase. An across-the-board increase of P0.085 per kilometer for all types of provincial buses with a minimum-
maximum fare range of 15% over and below the proposed basic per kilometer fare rate, with the said minimum-
maximum fare range applying only to ordinary, first class and premium class buses and P0.50 minimum per kilometer
fare for aircon buses, was sought.
- PBOAP reduced its applied proposed fare to an across-the-board increase of 0.065 centavos per kilometer for
ordinary buses. The decrease was due to the drop in the expected price of diesel.
- The application was opposed by the Philippine Consumers Foundation, Inc. and Perla C. Bautista alleging that the
proposed rates were exorbitant and unreasonable and that the application contained no allegation on the rate of
return of the proposed increase in rates.
- LTFRB rendered a decision granting the fare rate increase
- Then Secretary of DOTC issued Department Order No. 92-587 defining the policy framework on the regulation of
transport services.
- Respondent Secretary of the DOTC Jesus B. Garcia, Jr. issued a memorandum to the Acting Chairman of the
LTFRB suggesting swift action on the adoption of rules and procedures to implement above-quoted Department
Order No. 92-587 that laid down deregulation and other liberalization policies for the transport sector.
- LTFRB issued Memorandum Circular No. 92-009 promulgating guidelines for implementation of DOTC Department
Order No. 92-587.
- PBOAP, availing itself of the deregulation policy of the DOTC allowing provincial bus operators to collect plus 20%
and minus 25% of the prescribed fare without first having filed a petition for the purpose and without the benefit of a
public hearing, announced a fare increase of twenty (20%) percent of the existing fares.
- KMU filed a petition with LTFRB opposing the upward adjustment of bus fares. LTFRB issued one of the assailed
orders dismissing the petition for lack of merit.

ISSUE
WON KMU has the standing to sue.

HELD
YES.
- The requirement of locus standi inheres from the definition of judicial power.
- Lamb v. Phipps: judicial power is the power to hear and decide causes pending between parties who have the right
to sue in the courts of law and equity. Corollary to this provision is the principle of locus standi of a party litigant. One
who is directly affected by and whose interest is immediate and substantial in the controversy has the standing to
sue. The rule therefore requires that a party must show a personal stake in the outcome of the case or an injury to
himself that can be redressed by a favorable decision so as to warrant an invocation of the court's jurisdiction and to
justify the exercise of the court's remedial powers in his behalf.
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- Petitioner, whose members had suffered and continue to suffer grave and irreparable injury and damage from the
implementation of the questioned memoranda, circulars and/or orders, has shown that it has a clear legal right that
was violated and continues to be violated with the enforcement of the challenged memoranda, circulars and/or
orders.
- KMU members, who avail of the use of buses, trains and jeepneys everyday, are directly affected by the
burdensome cost of arbitrary increase in passenger fares. They are part of the millions of commuters who comprise
the riding public. Certainly, their rights must be protected, not neglected nor ignored.
- Assuming arguendo that petitioner is not possessed of the standing to sue, this court is ready to brush aside this
barren procedural infirmity and recognize the legal standing of the petitioner in view of the transcendental importance
of the issues raised. And this act of liberality is not without judicial precedent. As early as the Emergency
-Majority opinion says: petitioners are not parties to the contract  not real parties in interest  no cause of action 
no right of action  they cannot maintain the present petition.
-Minority says: Standing because of its constitutional and public policy underpinnings, is very different from questions
relating to whether a particular plaintiff is the real party in interest or has the capacity to sue. Although all three
requirements are directed towards ensuring that only certain parties can maintain an action, standing restrictions
require a partial consideration of the merits, as well as of broader policy concerns relating to the proper role of the
judiciary in certain areas.
-The matter of the right of petitioners to file and maintain this action – whether the objection thereto is premised on
lack of locus standi or right of action – has already been foreclosed by our judgment in the first lotto case. The
principles of "law of the case'' and res judicata are applicable.

DAVIDE, JR., J., dissenting:


NOTE: he is ponente of first Kilosbayan case and author of the exception to paragraph B, Section 1 of R.A. No. 1169,
as amended.
-disturbed by the sudden reversal of SC rulings in Kilosbayan, Inc. vs. Guingona and believes such reversal upsets
the salutary doctrines of the law of the case, res judicata, and stare decisis.
-In first Kilosbyan, SC sustained the locus standi of the petitioners, citing transcendental importance / paramount
public interest. The ramifications of such issues immeasurably affect the social, economic, and moral well-being of
the people even in the remotest barangays of the country and the counter-productive and retrogressive effects of the
envisioned on-line lottery system are as staggering as the billions of pesos its is expected to raise.
-The prevailing doctrines in taxpayer's suits are to allow taxpayers to question contracts entered into by the national
government or GOCCs allegedly in contravention of the law and to disallow the same when only municipal contracts
are involved. As long as the ruling in Kilosbayan on locus standi is not reversed, we have no choice but to follow it
and uphold the legal standing of petitioners as taxpayers to institute the present action.
-Under the principle of either the law of the case or res judicata, the PCSO and the PGMC are bound by the ruling in
the first lotto case on the locus standi of the petitioners and the application or interpretation of the exception clause in
par. B, Sec. 1 of R.A.1169, as amended. Moreover, that application or interpretation has been laid to rest under the
doctrine of stare decisis and has also become part of our legal system pursuant to Article 8 of the Civil Code.
-The legal question of locus standi which was resolved in favor of the petitioners in the first lotto case is the same in
this case and in every subsequent case which would involve contracts relating or incidental to the conduct or holding
of lotteries by the PCSO in collaboration, association, or joint venture with any person, association, company, or
entity. For one thing, the question of the petitioners' legal standing in the first lotto case and in this case is one and
the same issue of law. For another, these cases involve the same and not substantially unrelated subject matter, viz.,
the second contract between the PCSO and the PGMC on the operation of the on-line lottery system.
-It must be pointed out that the rule in ordinary civil procedure on real party in interest was never put in issue in the
previous case. It was the clear understanding of the Members of the Court that in the light of the issues raised and
the arguments adduced therein, only locus standi deserved consideration.
-Friedenthal; et al., whose book is cited in the majority opinion in its discussion of the rule on real party in interest and
the doctrine of locus standi, admit that there is a difference between the two, and that the former is not strictly
applicable in public law cases, thus: “It is important to note, however, that standing, because of its constitutional and
public policy underpinnings, is very different from questions relating to whether a particular plaintiff is the real party in
interest or has capacity to sue. Although all three requirements are directed toward ensuring that only certain parties
can maintain an action, standing restrictions require a partial consideration of the merits, as well as of broader policy
concerns relating to the proper role of the judiciary in certain areas.” xxx In the realm of public law, the real party in
interest rule is not applicable.
-The attempt to use the real-party-in-interest rule is to resurrect the abandoned restrictive application of locus standi.
Such attempt directly or indirectly restricts the exercise of the judicial authority of this Court in an original action to
determine whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the Government. Only a very limited few may qualify, under the real-party-in-
interest rule, to bring actions to question acts or contracts tainted with such vice.
-Locus standi is not such an absolute rule that it cannot admit of exceptions under certain conditions or
circumstances like those attending this transaction.
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DOMINGO v CARAGUE
456 SCRA 450
SANDOVAL-GUTIERREZ; July 18, 1991

FACTS
- Petitioners Eufemio C. Domingo, Celso C. Gangan, Pascasio S. Banaria are retired Chairmen, while Sofronio B.
Ursal, and Alberto P. Cruz are retired Commissioners of COA. All claim “to maintain a deep-seated abiding interest in
the affairs of COA,” especially in its Organizational Restructuring Plan, as concerned taxpayers.
- The other petitioners are incumbent officers or employees of COA. These petitioners claim that they were
unceremoniously divested of their designations/ranks upon implementation of the COA Organizational Restructuring
Plan without just cause and without due process, in violation of Civil Service Law. Moreover, they were deprived of
their respective Representation and Transportation Allowances (RATA), thus causing them undue financial prejudice.
- Petitioners now invoke this Court’s judicial power to strike down the COA Organizational Restructuring Plan for
being unconstitutional or illegal.
- Petitioners invoke our ruling in Chavez v. Public Estates Authority, Agan, Jr. v. Philippine International Air Terminals
Co., Inc., and Information Technology Foundation of the Philippines v. Commission on Elections that where the
subject matter of a case is a matter of public concern and imbued with public interest, then this fact alone gives them
legal standing to institute the instant petition. Petitioners contend that the COA Organizational Restructuring Plan is
not just a mere reorganization but a revamp or overhaul of the COA, with a “spillover effect” upon its audit
performance. This will have an impact upon the rest of the government bodies subject to its audit supervision, thus,
should be treated as a matter of transcendental importance. Consequently, petitioners’ legal standing should be
recognized and upheld.
- Respondents, through the Office of the Solicitor General (OSG), counter that petitioners have no legal standing to
file the present petition since following our ruling in Kilusang Mayo Uno Labor Center v. Garcia, Jr., they have not
shown “a personal stake in the outcome of the case” or an actual or potential injury that can be redressed by our
favorable decision. Petitioners themselves admitted that “they do not seek any affirmative relief nor impute any
improper or improvident act against the said respondents” and “are not motivated by any desire to seek affirmative
relief from COA or from respondents that would redound to their personal benefit or gain.” It is clear then that
petitioners failed to show any “present substantial interest” in the outcome of this case, citing Kilosbayan v. Morato.
Nor may petitioners claim that as taxpayers, they have legal standing since nowhere in their petition do they claim
that public funds are being spent in violation of law or that there is a misapplication of the taxpayers’ money, as we
ruled in Dumlao v. Comelec.

ISSUE
WON petitioners have standing to sue

HELD
Ratio Judicial power is the power to hear and decide cases pending between parties who have the right to sue in
courts of law and equity. Corollary to this dictum is the principle of locus standi of a litigant. He who is directly
affected and whose interest is immediate and substantial has the standing to sue. Thus, a party must show a
personal stake in the outcome of the case or an injury to himself that can be redressed by a favorable decision in
order to warrant an invocation of the court’s jurisdiction and justify the exercise of judicial power on his behalf.
Reasoning Petitioners have not shown any direct and personal interest in the COA Organizational Restructuring
Plan. There is no indication that they have sustained or are in imminent danger of sustaining some direct injury as a
result of its implementation. In fact, they admitted that “they do not seek any affirmative relief nor impute any
improper or improvident act against the respondents” and “are not motivated by any desire to seek affirmative relief
from COA or from respondents that would redound to their personal benefit or gain.” Clearly, they do not have any
legal standing to file the instant suit.
- In Chavez, we ruled that the petitioner has legal standing since he is a taxpayer and his purpose in filing the petition
is to compel the Public Estate Authority (PEA) to perform its constitutional duties with respect to: (a) the right of the
citizens to information on matters of public concern; and (b) the application of a constitutional provision intended to
insure the equitable distribution of alienable lands of the public domain among Filipino citizens. The thrust of the first
is to compel PEA to disclose publicly information on the sale of Government lands worth billions of pesos, as
mandated by the Constitution and statutory law. The thrust of the second is to prevent PEA from alienating hundreds
of hectares of alienable lands of the public domain, thereby compelling it to comply with a constitutional duty to the
nation. We held that these matters are of transcendental public importance.
- In Agan, Jr., we held that petitioners have legal standing as they have a direct and substantial interest to protect. By
the implementation of the PIATCO contracts, they stand to lose their source of livelihood, a property right zealously
protected by the Constitution. Such financial prejudice on their part is sufficient to confer upon them the requisite
locus standi.
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- In Information Technology Foundation, there were two reasons why petitioners’ standing was recognized. First, the
nation’s political and economic future virtually hangs in the balance, pending the outcome of the 2004 elections.
Accordingly, the award for the automation of the electoral process was a matter of public concern, imbued with public
interest. Second, the individual petitioners, as taxpayers, asserted a material interest in seeing to it that public funds
are properly used.
- There was also no demotion to speak of. Under Section 11, Rule VII of the Omnibus Rules Implementing Book V of
the Administrative Code of 1987, a demotion is the movement from one position to another involving the issuance of
an appointment with diminution in duties, responsibilities, status, or rank which may or may not involve reduction in
salary. A demotion by assigning an employee to a lower position in the same service which has a lower rate of
compensation is tantamount to removal, if no cause is shown for it. Here, there have been no new appointments
issued to Matib, Pacpaco, Sanchez, and Sipi-An under the COA Organizational Restructuring Plan. Thus, their
contention that they have been demoted is baseless.
- Moreover, the change in their status from COA auditors (receiving monthly RATA) to COA auditors (receiving only
reimbursable RATA) cannot be attributed to the COA Organizational Restructuring Plan but to the implementation of
the Audit Team Approach (ATAP).
Disposition Petition dismissed.

ASSOCIATION OF DATA PROCESSING SERVICE ORGANIZATION v CAMP

ASSOC. OF DATA PROCESSING SERVICE ORG. VS CAMP ET AL.


MARCH 3, 1970; DOUGLAS

FACTS
Petitioners sell data processing services to businesses. Respondent is Comptroller of Currency. Respondent ruled
that national banks, as an incident to their banking services, may make data processing available to other banks and
bank customers. Petitioners challenge this ruling. District Court dismissed complaint for lack of standing to bring suit.
CA affirmed District Court. Case was brought to SC on petition for certiorari. SC granted petition. Case remanded for
hearing on the merits.

ISSUE/HELD
 Whether petitioners have standing to sue  YES
 Whether petitioners alleged that the ruling has caused them injury  YES
 Whether interest sought to be protected by petitioners is within the zone of interests to be protected by statute or
constitutional guarantee  YES
 Whether judicial review of the Comptroller's action is precluded  NO

RATIO
 The question of standing in federal courts is to be considered in a framework of restricting judicial power to
“cases” and “controversies.” Issues in relation to the question of standing: (1) dispute in an adversary context,
and (2) capability of judicial resolution. The case is a competitor’s suit. Petitioners have standing to sue.
 Petitioners alleged their legal interest in: (1) that competition by national banks might entail future loss, and (2)
that respondent bank was preparing to perform services to customers with whom petitioners previously
negotiated with. As to the comptroller, it allegedly caused injury to petitioners when it allowed the national banks
to perform the services being performed by the petitioners.
 The Administrative Procedure Act grants standing to a person aggrieved by agency action. Standing may stem
from economic/financial injury, as in the case at bar.
 Trend is toward enlargement of the class of people who may protest administrative action. No explicit statutory
provision is necessary to confer standing, when petitioners are within the class of persons sought to be protected
by the statute.
 Bank Service Corporation Act provides that no bank service corporation may engage in any activity, other than
the performance of bank services for banks. Thus, a data processing company has standing to contest the
legality of a national bank performing data processing services for other banks and bank customers.
 Judicial Review of Comptroller's action was not precluded. The Administrative Procedure Act authorized judicial
review when: (1) statutes preclude judicial review; or (2) agency action is committed to agency discretion by law.
 The mere failure to provide by statute for judicial review is no evidence of intent to withhold review. There is no
presumption against judicial review and in favor of administrative absolutism, unless that purpose is fairly
discernible in the statutory scheme.
 Petitioners, as competitors of national banks which were allowed by the Comptroller to engage in data
processing services, are within that class of “aggrieved” persons who, are entitled to judicial review of “agency
action.”
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- Faye Celso -

SIERRA CLUB v MORTON


405 U.S. 727
STEWART; April 19, 1972

FACTS:
- The Mineral King Valley in the Sierra Nevada Mountains in Tulare County, California has been part of the Sequoia
National Forest since 1926, and is designated as a national game refuge by special Act of Congress. Though once
the site of extensive mining activity, Mineral King is now used almost exclusively for recreational purposes.
- The United States Forest Service began in the late 1940's to give consideration to Mineral King as a potential site
for recreational development. The Forest Service published a prospectus in 1965, inviting bids from private
developers for the construction and operation of a ski resort that would also serve as a summer recreation area. The
proposal of Walt Disney Enterprises, Inc. was chosen.
- The final Disney plan, approved by the Forest Service in January 1969, outlines a $35 million complex of motels,
restaurants, swimming pools, parking lots, and other structures designed to accommodate 14,000 visitors daily. This
complex is to be constructed on 80 acres of the valley floor under a 30-year use permit from the Forest Service.
Other facilities, including ski lifts, ski trails, a cog-assisted railway, and utility installations, are to be constructed on the
mountain slopes and in other parts of the valley under a revocable special-use permit. To provide access to the
resort, the State of California proposes to construct a highway 20 miles in length. A section of this road would traverse
Sequoia National Park, as would a proposed high-voltage power line needed to provide electricity for the resort. Both
the highway and the power line require the approval of the Department of the Interior, which is entrusted with the
preservation and maintenance of the national parks.
- Representatives of the Sierra Club, who favor maintaining Mineral King largely in its present state, unsuccessfully
sought a public hearing on the proposed development in 1965, and in subsequent correspondence with officials of
the Forest Service and the Department of the Interior, they expressed the Club's objections to Disney's plan as a
whole and to particular features included in it.
- In June 1969 the Club filed suit in the United States District Court for the Northern District of California, seeking a
declaratory judgment that various aspects of the proposed development contravene federal laws and regulations
governing the preservation of national parks, forests, and game refuges, and also seeking preliminary and permanent
injunctions restraining the federal officials involved from granting their approval or issuing permits in connection with
the Mineral King project. The petitioner Sierra Club sued as a membership corporation with "a special interest in the
conservation and the sound maintenance of the national parks, game refuges and forests of the country...."

ISSUE
WON the Club has alleged facts that entitle it to obtain judicial review

HELD:
NO
Ratio Whether a party has a sufficient stake in an otherwise justiciable controversy to obtain judicial resolution of that
controversy is what has traditionally been referred to as the question of standing to sue. Where the party does not
rely on any specific statute authorizing invocation of the judicial process, the question of standing depends upon
whether the party has alleged such a "personal stake in the outcome of the controversy" as to ensure that "the
dispute sought to be adjudicated will be presented in an adversary context and in a form historically viewed as
capable of judicial resolution...."
Reasoning The injury alleged by the Sierra Club will be incurred entirely by reason of the change in the uses to
which Mineral King will be put, and the attendant change in the aesthetics and ecology of the area. Thus, in referring
to the road to be built through Sequoia National Park, the complaint alleged that the development "would destroy or
otherwise adversely affect the scenery, natural and historic objects and wildlife of the park and would impair the
enjoyment of the park for future generations." This type of harm may amount to an "injury in fact" sufficient to lay the
basis for standing. Aesthetic and environmental well-being, like economic well-being, are important ingredients of the
quality of life in our society, and the fact that particular environmental interests are shared by the many rather than the
few does not make them less deserving of legal protection through the judicial process. But the "injury in fact" test
requires more than an injury to a cognizable interest. It requires that the party seeking review be himself among the
injured.
- The impact of the proposed changes in the environment of Mineral King will not fall indiscriminately upon every
citizen. The alleged injury will be felt directly only by those who use Mineral King and Sequoia National Park, and for
whom the aesthetic and recreational values of the area will be lessened by the highway and ski resort. The Sierra
Club failed to allege that it or its members would be affected in any of their activities or pastimes by the Disney
development. Nowhere in the pleadings or affidavits did the Club state that its members use Mineral King for any
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purpose, much less that they use it in any way that would be significantly affected by the proposed actions of the
respondents.
- The Club apparently regarded any allegations of individualized injury as superfluous, on the theory that this was a
"public" action involving questions as to the use of natural resources, and that the Club's longstanding concern with
and expertise in such matters were sufficient to give it standing as a "representative of the public".
- It is clear that an organization whose members are injured may represent those members in a proceeding for
judicial review. But a mere "interest in a problem," no matter how longstanding the interest and no matter how
qualified the organization is in evaluating the problem, is not sufficient by itself to render the organization "adversely
affected" or "aggrieved”.
- The requirement that a party seeking review must allege facts showing that he is himself adversely affected does
not insulate executive action from judicial review, nor does it prevent any public interests from being protected
through the judicial process. It does serve as at least a rough attempt to put the decision as to whether review will be
sought in the hands of those who have a direct stake in the outcome. That goal would be undermined were the Act
construed to authorize judicial review at the behest of organizations or individuals who seek to do no more than
vindicate their own value preferences through the judicial process.

DOUGLAS, dissenting.
- The critical question of "standing" would be simplified and also put neatly in focus if we fashioned a federal rule that
allowed environmental issues to be litigated before federal agencies or federal courts in the name of the inanimate
object about to be despoiled, defaced, or invaded by roads and bulldozers and where injury is the subject of public
outrage. Contemporary public concern for protecting nature's ecological equilibrium should lead to the conferral of
standing upon environmental objects to sue for their own preservation.
- Inanimate objects are sometimes parties in litigation. A ship has a legal personality, a fiction found useful for
maritime purposes. The sole corporation is an acceptable adversary and large fortunes ride on its cases. The
ordinary corporation is a "person" for purposes of the adjudicatory processes, whether it represents proprietary,
spiritual, aesthetic, or charitable causes.
- So it should be as respects valleys, alpine meadows, rivers, lakes, estuaries, beaches, ridges, groves of trees,
swampland, or even air that feels the destructive pressures of modern technology and modern life. The river, for
example, is the living symbol of all the life it sustains or nourishes - fish, aquatic insects, water ouzels, otter, fisher,
deer, elk, bear, and all other animals, including man, who are dependent on it or who enjoy it for its sight, its sound, or
its life. The river as plaintiff speaks for the ecological unit of life that is part of it. Those people who have a meaningful
relation to that body of water - whether it be a fisherman, a canoeist, a zoologist, or a logger - must be able to speak
for the values which the river represents and which are threatened with destruction. The voice of the inanimate
object, therefore, should not be stilled. Those inarticulate members of the ecological group cannot speak. But those
people who have so frequented the place as to know its values and wonders will be able to speak for the entire
ecological community.

BLACKMUN, joined by BRENNAN, dissenting.


- The case poses significant aspects of a wide, growing, and disturbing problem, that is, the Nation's and the world's
deteriorating environment with its resulting ecological disturbances. Must our law be so rigid and our procedural
concepts so inflexible that we render ourselves helpless when the existing methods and the traditional concepts do
not quite fit and do not prove to be entirely adequate for new issues?
- The ultimate result of the Court's decision is that the 35.3-million-dollar complex, over 10 times greater than the
Forest Service's suggested minimum, will now hastily proceed to completion; that serious opposition to it will recede
in discouragement; and that Mineral King, the "area of great natural beauty nestled in the Sierra Nevada Mountains,"
will become defaced, at least in part, and, like so many other areas, will cease to be "uncluttered by the products of
civilization....."

SIMON v EASTERN KENTUCKY WELFARE RIGHTS ORGANIZATION


426 US 26
POWELL; June 1, 1976

Simon v. Eastern Kentucky Welfare Rights Organization (EKWRO) et. al.


Dec. 10, 1975 | Powell, J.

Facts:
- Revenue Ruling 69-545 was issued by the Internal Revenue Service (IRS) extending to favorable tax treatment to
certain hospitals. Note that this advantageous treatment is extended to nonprofit hospitals that are considered
‘charitable’ i.e. those rendering services even to indigents.
- EKWRO et. al. (organizations composed of indigents), brought this class suit against the Secretary of the Treasury
and the Commissioner of Internal Revenue (petitioners) alleging that the ruling is violative of the Administrative
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Procedure Act. They allege that the ruling granted tax discounts to two hospitals that did not serve indigents to the
extent of the hospitals’ financial ability. Thus, these two officers ‘encouraged’ such practice i.e. not rendering
services to the indigents but still getting tax discounts. They described several instances in which these hospitals
refused to render services to them due to their financial standing.
- The petitioners challenged the suit based on lack of standing, nonjusticiability of the subject matter of the suit, and
doctrine of sovereign immunity. They posited that allowing third-party suits to question the tax treatment accorded
other taxpayers would transfer determination of general revenue policy away from those to whom Congress has
entrusted it and vest it in federal courts.

Issue/Held: Do the organizations have standing? No, they do not have.

Ratio:
- The concept of standing id a part of the constitutional limitation of the courts to actual cases or controversies.
- Standing focuses on the party seeking to get his complaint before a federal court, and not on the issue he wishes
to have adjudicated.
- “Whether the plaintiff has alleged such as personal stake in the outcome of the controversy as to warrant his
invocation of the court’s jurisdiction and to justify exercise of the court’s remedial powets on his behalf.”
- Though the organizations dedicate themselves to promoting access of the poor to health services, standing could
not be established simply on that basis. An organization’s abstract concern with a subject that could be affected by
an adjudication does not substitute for the concrete injury required by the law.
- Since the organizations alleged no injury to themselves as organizations, they can only bring the suit as
representatives of their members, in their own right. But this, they did not do. Though specific occasions were cited,
it is not sufficient to establish injury since no hospital is a defendant.
- Also, it is purely speculative to allege that should the requested relief be granted, the hospitals will be ‘discouraged’
to deny their services to respondents.

- Jiselle Compuesto -

LUJAN VS NATIONAL WILDLIFE FEDERATION


497 US 871
SCALIA; June 27, 1990

FACTS
- In various enactments, Congress empowered United States citizens to acquire title to, and rights in, vast portions of
federally owned land. Congress also provided means, however, for the Executive to remove public lands from the
operation of these statutes. The Pickett Act authorized the President "at any time in his discretion, temporarily to
withdraw from settlement, location, sale, or entry any of the public lands of the United States . . . and reserve the
same for water-power sites, irrigation, classification of lands, or other public purposes. . . ."
- Acting under this and under the Taylor Grazing Act of 1934, which gave the Secretary of the Interior authority to
"classify" public lands as suitable for either disposal or federal retention and management, President Roosevelt
withdrew all unreserved public land from disposal until such time as they were classified. Congress amended § 7 of
the Taylor Grazing Act to authorize the Secretary of the Interior "to examine and classify any lands" withdrawn by
these orders and by other authority as "more valuable or suitable" for other uses "and to open such lands to entry,
selection, or location for disposal in accordance with such classification under applicable public land laws." The
amendment also directed that "such lands shall not be subject to disposition, settlement, or occupation until after the
same have been classified and opened to entry."
- The 1964 classification and multiple use Act gave the Secretary further authority to classify lands for the purpose of
either disposal or retention by the Federal Government.
- Management of the public lands under these various laws became chaotic. The Public Land Law Review
Commission, established by Congress in 1964 to study the matter, determined in 1970 that "virtually all" of the
country's public domain had been withdrawn or classified for retention; that it was difficult to determine "the extent of
existing Executive withdrawals and the degree to which withdrawals overlap each other," and that there were
inadequate records to show the purposes of withdrawals and the permissible public uses. Accordingly, it
recommended that "Congress should provide for a careful review of (1) all Executive withdrawals and reservations,
and (2) BLM retention and disposal classifications under the Classification and Multiple Use Act of 1964."
- In 1976, Congress passed the FLPMA, which repealed many of the miscellaneous laws governing disposal of public
land and established a policy in favor of retaining public lands for multiple use management. It directed the Secretary
to "prepare and maintain on a continuing basis an inventory of all public lands and their resource and other values." It
provided that existing classifications of public lands were subject to review in the land use planning process, and that
the Secretary could "modify or terminate any such classification consistent with such land use plans." It also
authorized the Secretary to "make, modify, extend or revoke" withdrawals. Finally it directed the Secretary, within 15
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years, to review withdrawals in existence in 1976 in 11 western States and to "determine whether, and for how long,
the continuation of the existing withdrawal of the lands would be, in his judgment, consistent with the statutory
objectives of the programs for which the lands were dedicated and of the other relevant programs,"
- The activities undertaken by the BLM to comply with these various provisions constitute what respondent's
amended complaint styles the BLM's "land withdrawal review program," which is the subject of the current litigation.
- Pursuant to the directives of the FLPMA, the petitioners engage in a number of different types of administrative
action with respect to the various tracts of public land within the United States. First, the BLM conducts the review
and recommends the determinations required with respect to withdrawals in 11 western States. Second, the
Secretary revokes some withdrawals. Third, the Secretary engages in the ongoing process of classifying public lands,
either for multiple-use management, for disposal or for other uses.
- In its complaint, respondent averred generally that the reclassification of some withdrawn lands and the return of
others to the public domain would open the lands up to mining activities, thereby destroying their natural beauty.
Respondent alleged that petitioners, in the course of administering the Nation's public lands, had violated the FLPMA
by failing to "develop, maintain, and, when appropriate, revise land use plans which provide by tracts or areas for the
use of the public lands,"; failing to submit recommendations as to withdrawals in the 11 western States to the
President; failing to consider multiple uses for the disputed lands; and failing to provide public notice of decisions.
Respondent also claimed that petitioners had violated NEPA, which requires federal agencies to "include in every
recommendation or report on . . . major Federal actions significantly affecting the quality of the human environment, a
detailed statement by the responsible official on . . . the environmental impact of the proposed action." Finally,
respondent alleged that all of the above actions were "arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with law," and should therefore be set aside pursuant to § 10(e) of the APA.
- The court granted petitioners' motion for summary judgment under Federal Rule of Civil Procedure 56, holding that
respondent lacked standing to seek judicial review of petitioners' actions under the APA. The court ruled that affidavits
by two of respondent's members, Peterson and Erman, claiming use of public lands "in the vicinity" of lands covered
by two of the listed decisions, were insufficient to confer standing as to those particular decisions, and that, even if
they had been adequate for that limited purpose, they could not support respondent's attempted APA challenge to
each of the 1,250 or so individual actions effected under the program. The court rejected as untimely four more
member affidavits pertaining to standing, which were submitted after argument on the summary judgment motion and
in purported response to the District Court's postargument request for additional briefing. The Court of Appeals
reversed, holding that the Peterson and Erman affidavits were sufficient in themselves, that it was an abuse of
discretion not to consider the four additional affidavits, and that standing to challenge the individual decisions
conferred standing to challenge all such decisions.

ISSUE
WON the National Wildlife Federation is a proper party to challenge actions of the Federal Government relating to
certain public lands.

HELD
NO.
1. The Peterson and Erman affidavits are insufficient to establish respondent's 702 entitlement to judicial review as
"[a] person ... adversely affected or aggrieved by agency action within the meaning of a relevant statute.”
(a) To establish a right to relief, respondent must satisfy two requirements. First, it must show that it has been
affected by some "agency action". Since neither the FLPMA nor NEPA provides a private right of action, the "agency
action" in question must also be "final agency action". Second, respondent must prove that it is "adversely affected or
aggrieved" by that action "within the meaning of a relevant statute," which requires a showing that the injury
complained of falls within the "zone of interests" sought to be protected by the FLPMA and NEPA.
(b) When a defendant moves for summary judgment on the ground that the plaintiff has failed to establish a right to
relief, the burden is on the plaintiff to set forth specific facts (even though they may be controverted by the defendant)
showing that there is a genuine issue for trial. Where no such showing is made, the defendant is entitled to judgment
as a matter of law.
(c) The specific facts alleged in the two affidavits do not raise a genuine issue of fact as to whether respondent has a
right to relief. It may be assumed that the allegedly affected interests set forth in the affidavits — "recreational use
and aesthetic enjoyment" — are sufficiently related to respondent's purposes that respondent meets requirements if
any of its members do. Moreover, each affidavit can be read to complain of a particular "agency action"; and
whatever "adverse effect" or "aggrievement" is established by the affidavits meets the "zone of interests" test, since
"recreational use and aesthetic enjoyment" are among the sorts of interests that the FLPMA and NEPA are designed
to protect. However, there has been no showing that those interests of Peterson and Erman were actually "affected"
by petitioners' actions, since the affidavits alleged only that the affiants used unspecified lands "in the vicinity of"
immense tracts of territory, only on some portions of which, the record shows, mining activity has occurred or
probably will occur by virtue of the complained-of actions. The Court of Appeals erred in ruling that the District Court
had to presume specific facts sufficient to support the general allegations of injury to the affiants, since such facts are
essential to sustaining the complaint and, under Rule 56(e), had to be set forth by respondent.
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2. Respondent's four additional member affidavits did not establish its right to review.
(a) The affidavits are insufficient to enable respondent to challenge the entirety of petitioners' "land withdrawal review
program." That term does not refer to a single BLM order or regulation, or even to a completed universe of particular
BLM orders and regulations, but is simply the name by which petitioners have occasionally referred to certain
continuing (and thus constantly changing) BLM operations regarding public lands, which currently extend to about
1,250 individual decisions and presumably will include more actions in the future. Thus, the program is not an
identifiable "agency action", much less a "final agency action." Absent an explicit congressional authorization to
correct the administrative process on a systemic level, agency action is not ordinarily considered "ripe" for judicial
review under the APA until the scope of the controversy has been reduced to manageable proportions, and its factual
components fleshed out, by concrete action that harms or threatens to harm the complainant. It may well be, due to
the scope of the "program," that the individual BLM actions indentified in the affidavits will not be "ripe" for challenge
until some further agency action or inaction more immediately harming respondent occurs. But it is entirely certain
that the flaws in the entire "program" cannot be laid before the courts for wholesale cor rection under the APA simply
because one of them that is ripe for review adversely affects one of respondent's members. Respondent must seek
such programmatic improvements from the BLM or Congress.
(b) The District Court did not abuse its discretion in declining to admit the supplemental affidavits. Since the affidavits
were filed in response to the court's briefing order following the summary judgment hearing, they were untimely
under, inter alia, Rule 6(d), which provides that "opposing affidavits may be served not later than 1 day before the
hearing." Although Rule 6(b) allows a court, "in its discretion," to extend any filing deadline "for cause shown," a post-
deadline extension must be "upon motion made," and is permissible only where the failure to meet the deadline "was
the result of excusable neglect." Here, respondent made no motion for extension nor any showing of "cause."
Moreover, the failure to timely file did not result from "excusable neglect," since the court's order setting the hearing
on the summary judgment motion put respondent on notice that its right to sue was at issue, and that (absent proper
motion) the time for filing additional evidentiary materials was, at the latest, the day before the hearing. Even if the
court could have overcome these obstacles to admit the affidavits, it was not compelled, in exercising its discretion, to
do so.
3. Respondent is not entitled to seek review of petitioners' actions in its own right. The brief affidavit submitted to the
District Court to show that respondent's ability to fulfill its informational and advocacy functions was "adversely
affected" by petitioners' alleged failure to provide adequate information and opportunities for public participation with
respect to the land withdrawal review program fails to identify any particular "agency action" that was the source of
respondent's alleged injuries, since that program is not an identifiable action or event. Thus, the affidavit does not set
forth the specific facts necessary to survive a Rule 56 motion.
Disposition judgment of the Court of Appeals is reversed.

LUJAN VS DEFENDERS OF WILDLIFE


504 US 555
SCALIA; June 12, 1992

FACTS
The ENDANGERED SPECIES ACT OF 1973 seeks to protect species of animals against threats to their continuing
existence caused by man. The ESA instructs the Secretary of the Interior to promulgate by regulation a list of those
species which are either endangered or threatened under enumerated criteria, and to define the critical habitat of
these species. Section 7(a)(2) of the Act provides, in pertinent part:
"Each Federal agency shall, in consultation with and with the assistance of the Secretary [of the Interior], insure that
any action authorized, funded, or carried out by such agency ... is not likely to jeopardize the continued existence of
any endangered species or threatened species or result in the destruction or adverse modification of habitat of such
species which is determined by the Secretary, after consultation as appropriate with affected States, to be critical." 16
U. S. C. § 1536(a)(2).
In 1978, the Fish and Wildlife Service (FWS) and the N ational Marine Fisheries Service (NMFS), on behalf of the
Secretary of the Interior and the Secretary of Commerce respectively, promulgated a joint regulation stating that the
obligations imposed by § 7(a)(2) extend to actions taken in foreign nations. The next year, however, the Interior
Department began to reexamine its position. A revised joint regulation, reinterpreting § 7(a)(2) to require consultation
only for actions taken in the United States or on the high seas, was proposed in 1983,
Shortly thereafter, respondents, organizations dedicated to wildlife conservation and other environmental causes,
filed this action against the Secretary of the Interior, seeking a declaratory judgment that the new regulation is in error
as to the geographic scope of § 7(a)(2) and an injunction requiring the Secretary to promulgate a new regulation
restoring the initial interpretation. The District Court granted the Secretary's motion to dismiss for lack of standing.
Defenders of Wildlife v. Hodel, 658 F. Supp. 43, 47-48 (Minn. 1987). The Court of Appeals for the Eighth Circuit
reversed by a divided vote. Defenders of Wildlife v. Hodel, 851 F. 2d 1035 (1988). On remand, the Secretary moved
for summary judgment on the standing issue, and respondents moved for summary judgment on the merits. The
District Court denied the Secretary's motion, on the ground that the Eighth Circuit had already determined the
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standing question in this case; it granted respondents' merits motion, and ordered the Secretary to publish a revised
regulation. The Eighth Circuit affirmed.

ISSUE
WON respondents have standing to seek judicial review of the rule.

HELD
NO
Over the years, cases have established that the irreducible constitutional minimum of standing contains three
elements. First, the plaintiff must have suffered an "injury in fact" -an invasion of a legally protected interest which is
(a) concrete and particularized, (b) "actual or imminent, not 'conjectural' or 'hypothetical,'" Second, there must be a
causal connection between the injury and the conduct complained of-the injury has to be "fairly ... trace[able] to the
challenged action of the defendant, and not ... thee] result [of] the independent action of some third party not before
the court." By particularized, we mean that the injury must affect the plaintiff in a personal and individual way. Third, it
must be "likely," as opposed to merely "speculative," that the injury will be "redressed by a favorable decision."The
party invoking federal jurisdiction bears the burden of establishing these elements.
REASONING Respondents' claim to injury is that the lack of consultation with respect to certain funded activities
abroad "increas[es] the rate of extinction of endangered and threatened species." Complaint' 5, App. 13. Of course,
the desire to use or observe an animal species, even for purely esthetic purposes, is undeniably a cognizable interest
for purpose of standing. "But the 'injury in fact' test requires more than an injury to a cognizable interest. It requires
that the party seeking review be himself among the injured." To survive the Secretary's summary judgment motion,
respondents had to submit affidavits or other evidence showing, through specific facts, not only that listed species
were in fact being threatened by funded activities abroad, but also that one or more of respondents' members would
thereby be "directly" affected apart from their" 'special interest' in thee subject.
Respondents did not demonstrate that they suffered an injury in fact. Assuming that they established that funded
activities abroad threaten certain species, they failed to show that one or more of their members would thereby be
directly affected apart from the members' special interest in the subject. Affidavits of members claiming an intent to
revisit project sites at some indefinite future time, at which time they will presumably be denied the opportunity to
observe endangered animals, do not suffice, for they do not demonstrate an "imminent" injury. Respondents also
mistakenly rely on a number of other novel standing theories. Their theory that any person using any part of a
contiguous ecosystem adversely affected by a funded activity has standing even if the activity is located far away
from the area of their use is inconsistent with this Court's opinion in Lujan v. National Wildlife Federation And they
state purely speculative, nonconcrete injuries when they argue that suit can be brought by anyone with an interest in
studying or seeing endangered animals anywhere on the globe and anyone with a professional interest in such
animals.
The Court of Appeals erred in holding that respondents had standing on the ground that the statute's citizen-suit
provision confers on all persons the right to file suit to challenge the Secretary's failure to follow the proper
consultative procedure, notwithstanding their inability to allege any separate concrete injury flowing from that failure.
This Court has consistently held that a plaintiff claiming only a generally available grievance about government,
unconnected with a threatened concrete interest of his own, does not state an Article III case or controversy.
Vindicating the public interest is the function of the Congress and the Chief Executive. To allow that interest to be
converted into an individual right by a statute denominating it as such and permitting all citizens to sue, regardless of
whether they suffered any concrete injury, would authorize Congress to transfer from the President to the courts the
Chief Executive's most important constitutional duty, to "take Care that the Laws be faithfully executed
DISPOSITION The judgment is reversed, and the case is remanded

E. RIPENESS

ABBOTT LABORATORIES v GARDNER


387 U.S. 136
HARLAN, J. (22 May 1967)

FACTS
- The Federal Food, Drug, and Cosmetic Act required manufacturers of prescription drugs to print the "established
name" of the drug “prominently and… at least half as large as… [the] proprietary name… for such drug," on labels
and other printed material. The "established name" is one designated by the Secretary of Health, Education, and
Welfare (SECRETARY); the "proprietary name" is usually a trade name under which a drug is marketed.
- The Commissioner of Food and Drugs, exercising authority delegated to him by the SECRETARY, issued
regulations requiring that labels and advertisements for prescription drugs bearing the proprietary names for the
drugs or the ingredients, shall also carry the corresponding established names. Petitioners, composed of drug
manufacturers and a manufacturers' association, challenged the regulations on the ground that the Commissioner
exceeded his authority under the statute. The District Court granted the declaratory and injunctive relief sought. CA
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reversed the decision, holding, inter alia, that no "actual case or controversy" existed, and, accordingly, no relief
under the Administrative Procedure Act (APA) is available. Hence this petition.

ISSUE
WON the case presents a controversy "ripe" for judicial resolution.

HELD
YES.
- Injunctive and declaratory judgment remedies are discretionary, and courts have been reluctant to apply them to
administrative determinations unless these arise in the context of a controversy "ripe" for judicial resolution. The
ripeness doctrine’s basic rationale is to prevent the courts, through avoidance of premature adjudication,
from entangling themselves in abstract disagreements over administrative policies, and also to protect the
agencies from judicial interference until an administrative decision has been formalized and its effects felt in
a concrete way by the challenging parties. The problem is best seen in a twofold aspect: the fitness of the issues
for judicial decision and the hardship to the parties of withholding court consideration.
- As to fitness for judicial decision. The issues are appropriate for judicial resolution at this time. First, all parties agree
that the issue tendered is a purely legal one: whether the statute was properly construed by the Commissioner to
require the established name of the drug to be used every time the proprietary name is employed. Second, the
regulations are "final agency action" within the meaning of the APA. An "agency action" includes any "rule," defined
by the Act as "an agency statement of general or particular applicability and future effect designed to implement… law
or policy.”
- As to effect of withholding court consideration. This is also a case in which the impact of the regulations upon the
petitioners is sufficiently direct and immediate as to render the issue appropriate for judicial review at this stage.
These regulations purport to give an authoritative interpretation of a statutory provision that has a direct effect on the
daily business of prescription drug companies. Immediate compliance with their terms was expected. If petitioners
wish to comply, they must change all their labels and promotional materials. The alternative to compliance –
continued use of material which they believe in good faith meets the statutory requirements, but which clearly does
not meet the regulation of the Commissioner – may be even more costly. That course would risk serious criminal and
civil penalties for the unlawful distribution of "misbranded" drugs.
- It is relevant to recognize that petitioners deal in a sensitive industry, in which public confidence in their drug
products is especially important. Where the legal issue is fit for judicial resolution, and where a regulation
requires an immediate and significant change in the plaintiffs' conduct of their affairs with serious penalties
for noncompliance, access to the courts under the APA must be permitted, absent a statutory bar or other
unusual circumstance, neither of which appears here.

NATIONAL AUTOMATIC LAUNDRY AND CLEANING COUNCIL v SHULTZ


448 F 2d 689
CADC 1971

FACTS
- NALCC is a national trade association for the coin operated laundry and dry cleaning industry. A letter was sent by
NALCC’s lawyers to the Wage-hour Administrator regarding possible effect of the 1966 amendment to the Fair Labor
Standards Act on the status of their employees
- The original Section 12(a)(3) of the Act states that establishments engaged in laundering, cleaning or repairing
clothes or fabrics are qualified for retail exceptions for the Fair Labor Standards Act’s minimum wage and overtime
requirements. Under the original provision, coin operated launderettes were “engaged in renting the service of
laundry machine rather than in laundering or cleaning, hence exempt under Sec 13(a)(3)”. They could however
qualify for retail or service establishment exception under Sec 13(a) (2).
- In 1966 the law was amended repealing such provisions, specifying that establishments engaged in laundering,
cleaning, etc., could no longer qualify for the exceptions.
- The NALCC reasons that its members are unaffected by the amendments because coin operated laundries are not
engaged in laundering or cleaning. The administrator however said that the amendments have extended the
coverage of the Act to them.
- The NALCC challenged the ruling in a regular court prior to the institution of agency action for enforcement.

ISSUE
WON a direct judicial review of the agency’s interpretative action id permissible

HELD
Yes.
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- There are a number of elements which must be proved in order to obtain judicial review: a case or controversy,
ripeness, standing, finality, suitability of case for relief in equity or declaratory judgment. These elements are
separable but intermeshed in the overall determination of the appropriate occasion for judicial review.
Ripeness
a. The issue of ripeness not only involves an inquiry into the finality but also to the presumption of reviewability. The
court interpretation of the provisions of the Admin Procedure Act state that judicial review of a final agency action by
an aggrieved person will not be cut off unless there is persuasive reason to believe that such was the purpose of
Congress.
b. A person seeking judicial review of an agency action which has adversely affected or aggrieved him will not be
frustrated unless there is persuasive reason to believe that judicial review of the agency action was not the purpose
or intention of the legislature or that full discretion on the matter was granted to the admin agency.
c. General Ripeness Considerations
a. WON there is a congressional intent negative to judicial review
b. The possibility f the courts entangling themselves in abstract disagreement over administrative policies due to
premature adjudication
c. The fitness of issues for judicial determination and hardship to the parties of withholding court consideration
d. Finality and Formality of Rulings. The courts will not interfere with the executive function by entertaining a lawsuit
that challenges an action that is not final. An admin action is final if it is an authoritative interpretative ruling by an
agency head
 In this case, neither expressly nor by implication does the Fair Labor Standards Act show a congressional intent
negative to judicial review of the kind involved

VI. MODES OF JUDICIAL REVIEW

1987 CONSTITUTION, Article IX, A. Common Provisions


Sec. 7. Each Commission shall decide by a majority vote of all its Members, any case or matter brought before it
within sixty days from the date of is submission for decision or resolution. A case or matter is deemed submitted for
decision or resolution upon the filing of the last pleading, brief, or memorandum required by the rules of the
Commission or by the Commission itself. Unless otherwise provided by this Constitution or by law, any decision,
order, or ruling of each Commission may be brought to the Supreme Court on certiorari by the aggrieved party within
thirty days from receipt of a copy thereof.

THE JUDICIARY REORGANIZATION ACT OF 1980 (B.P. Blg 129, as amended)


Sec 9. Jurisdiction. – The Court of Appeals shall exercise:
(1) Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas corpus, and quo warranto,
and auxiliary writs or processes, whether or not in aid of its appellate jurisdiction;
(2) Exclusive original jurisdiction over actions for annulment of judgments of Regional Trial Courts; and
Exclusive appellate jurisdiction over all final judgments, decision, resolutions, orders or awards of Regional Trial
Courts and quasi-judicial agencies, instrumentalities, boards or commissions, including the Securities and
Exchange Commission, the Social Security Commission, the Employees Compensation Commission and the Civil
Service Commission, except those falling within the appellate jurisdiction of the Supreme Court in accordance with
the Constitution, the Labor Code of the Philippines under Presidential Decree No. 442, as amended, the provisions
of this Act, and of sub-paragraph (1) of the third paragraph and subparagraph 4 of the fourth paragraph of Section
17 of the Judiciary Act of 1948.
The Court of Appeals shall have the power to try cases and conduct hearings, receive evidence and perform any
and all acts necessary to resolve factual issues raised in cases falling within its original and appellate jurisdiction,
including the power to grant and conduct new trials or further proceedings. Trials or hearings in the Court of
Appeals must be continuous and must be completed within three (3) months, unless extended by the Chief Justice.

BOOK VII, SEC. 25, ADMINISTRATIVE CODE OF 1987


Section 25. Judicial Review. -
(1) Agency decisions shall be subject to judicial review in accordance with this chapter and applicable laws.
(2) Any party aggrieved or adversely affected by an agency decision may seek judicial review.
(3) The action for judicial review may be brought against the agency, or its officers, and all indispensable and
necessary parties as defined in the Rules of Court.
(4) Appeal from an agency decision shall be perfected by filing with the agency within fifteen (15) days from
receipt of a copy thereof a notice of appeal, and with the reviewing court a petition for review of the order.
Copies of the petition shall be served upon the agency and all parties of record. The petition shall contain a
concise statement of the issues involved and the grounds relied upon for the review, and shall be
accompanied with a true copy of the order appealed from, together with copies of such material portions of
the records as are referred to therein and other supporting papers. The petition shall be under oath and shall
how, by stating the specific material dates, that it was filed within the period fixed in this chapter.
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(5) The petition for review shall be perfected within fifteen (15) days from receipt of the final administrative
decision. One (1) motion for reconsideration may be allowed. If the motion is denied, the movant shall
perfect his appeal during the remaining period for appeal reckoned from receipt of the resolution of denial. If
the decision is reversed on reconsideration, the appellant shall have fifteen (15) days from receipt of the
resolution to perfect his appeal.
(6) The review proceeding shall be filed in the court specified by statute or, in the absence thereof, in any
court of competent jurisdiction in accordance with the provisions on venue of the Rules of Court.
(7) Review shall be made on the basis of the record taken as a whole. The findings of fact of the agency
when supported by substantial evidence shall be final except when specifically provided otherwise by law.

1997 RULES OF CIVIL PROCEDURE, Rule 43


Section 1. Scope. This Rule shall apply to appeals from judgments or final orders of the Court of Tax Appeals and
from awards, judgments, final orders or resolutions of or authorized by any quasi-judicial agency in the exercise of its
quasi-judicial functions. Among these agencies are the Civil Service Commission, Central Board of Assessment
Appeals, Securities and Exchange Commission, Office of the President, Land Registration Authority, Social Security
Commission, Civil Aeronautics Board, Bureau of Patents, Trademarks and Technology Transfer, National
Electrification Administration, Energy Regulatory Board, National Telecommunications Commission, Department of
Agrarian Reform under Republic Act No. 6657, Government Service Insurance System, Employees Compensation
Commission, Agricultural Inventions Board, Insurance Commission, Philippine Atomic Energy Commission, Board of
Investments, Construction Industry Arbitration Commission, and voluntary arbitrators authorized by law.

Sec. 2. Cases not covered. This Rule shall not apply to judgments or final orders issued under the Labor Code of
the Philippines.

Sec. 3. Where to appeal. An appeal under this Rule may be taken to the Court of Appeals within the period and in
the manner herein provided, whether the appeal involves questions of fact, of law, or mixed questions of fact and law.

Sec. 4. Period of appeal. The appeal shall be taken within fifteen (15) days from notice of the award, judgment, final
order or resolution, or from the date of its last publication, if publication is required by law for its effectivity, or of the
denial of petitioner’s motion for new trial or reconsideration duly filed in accordance with the governing law of the
court or agency a quo. Only one (1) motion for reconsideration shall be allowed. Upon proper motion and the
payment of the full amount of the docket fee before the expiration of the reglementary period, the Court of Appeals
may grant an additional period of fifteen (15) days only within which to file the petition for review. No further extension
shall be granted except for the most compelling reason and in no case to exceed fifteen (15) days.

Sec. 5. How appeal taken. Appeal shall be taken by filing a verified petition for review in seven (7) legible copies with
the Court of Appeals, with proof of service of a copy thereof on the adverse party and on the court or agency a quo.
The original copy of the petition intended for the Court of Appeals shall be indicated as such by the petitioner.
Upon the filing of the petition, the petitioner shall pay to the clerk of court of the Court of Appeals the docketing and
other lawful fees and deposit the sum of P500.00 for costs. Exemption from payment of docketing and other lawful
fees and the deposit for costs may be granted by the Court of
Appeals upon a verified motion setting forth valid grounds therefor. If the Court of Appeals denies the motion, the
petitioner shall pay the docketing and other lawful fees and deposit for costs within fifteen (15) days from notice of the
denial.

Sec. 6. Contents of the petition. The petition for review shall (a) state the full names of the parties to the case,
without impleading the court or agencies either as petitioners or respondents; (b) contain a concise statement of the
facts and issues involved and the grounds relied upon for the review; (c) be accompanied by a clearly legible
duplicate original or a certified true copy of the award, judgment, final order or resolution appealed from, together with
certified true copies of such material portions of the record referred to therein and other supporting papers; and (d)
contain a sworn certification against forum shopping as provided in the last paragraph of section 2, Rule 42. The
petition shall state the specific material dates showing that it was filed within the period fixed herein.

Sec. 7. Effect of failure to comply with requirements. The failure of the petitioner to comply with any of the
foregoing requirements regarding the payment of the docket and other lawful fees, the deposit for costs, proof of
service of the petition, and the contents of and the documents which should accompany the petition shall be sufficient
ground for the dismissal thereof.

Sec. 8. Action on the petition. The Court of Appeals may require the respondent to file a comment on the petition,
not a motion to dismiss, within ten (10) days from notice, or dismiss the petition if it finds the same to be patently
without merit, prosecuted manifestly for delay, or that the questions raised therein are too unsubstantial to require
consideration.
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Sec. 9. Contents of comment. The comment shall be filed within ten (10) days from notice in seven (7) legible
copies and accompanied by clearly legible certified true copies of such material portions of the record referred to
therein together with other supporting papers. The comment shall (a) point out insufficiencies or inaccuracies in
petitioner’s statement of facts and issues; and (b) state the reasons why the petition should be denied or dismissed. A
copy thereof shall be served on the petitioner, and proof of such service shall be filed with the Court of Appeals.

Sec. 10. Due course. If upon the filing of the comment or such other pleadings or documents as may be required or
allowed by the Court of Appeals or upon the expiration of the period for the filing thereof, and on the basis of the
petition or the records the Court of Appeals finds prima facie that the court or agency concerned has committed errors
of fact or law that would warrant reversal or modification of the award, judgment, final order or resolution sought to be
reviewed, it may give due course to the petition; otherwise, it shall dismiss the same. The findings of fact of the court
or agency concerned, when supported by substantial evidence, shall be binding on the Court of Appeals.

Sec. 11. Transmittal of record. Within fifteen (15) days from notice that the petition has been given due course, the
Court of Appeals may require the court or agency concerned to transmit the original or a legible certified true copy of
the entire record of the proceeding under review. The record to be transmitted may be abridged by agreement of all
parties to the proceeding. The Court of Appeals may require or permit subsequent correction of or addition to the
record.

Sec. 12. Effect of appeal. The appeal shall not stay the award, judgment, final order or resolution sought to be
reviewed unless the Court of Appeals shall direct otherwise upon such terms as it may deem just.

Sec. 13. Submission for decision. If the petition is given due course, the Court of Appeals may set the case for oral
argument or require the parties to submit memoranda within a period of fifteen (15) days from notice. The case shall
be deemed submitted for decision upon the filing of the last pleading or memorandum required by these Rules or by
the CA.

B. CERTIORARI

ST. MARTIN FUNERAL HOME v NLRC


295 SCRA 494
REGALADO, J.: September 12, 1998

FACTS:
- The present petition for certiorari stemmed from a complaint for illegal dismissal filed by herein private respondent
before the National Labor Relations Commission (NLRC), Regional Arbitration Branch No. III, in San Fernando,
Pampanga. Private respondent alleges that he started working as Operations Manager of petitioner St. Martin
Funeral Home on February 6, 1995. However, there was no contract of employment executed between him and
petitioner nor was his name included in the semi-monthly payroll. On January 22, 1996, he was dismissed from his
employment for allegedly misappropriating P38,000.00 which was intended for payment by petitioner of its value
added tax (VAT) to the Bureau of Internal Revenue (BIR).
- Petitioner on the other hand claims that private respondent was not its employee but only the uncle of Amelita
Malabed, the owner of petitioner St. Martin's Funeral Home. Sometime in 1995, private respondent, who was formerly
working as an overseas contract worker, asked for financial assistance from the mother of Amelita. Since then, as an
indication of gratitude, private respondent voluntarily helped the mother of Amelita in overseeing the business.
- In January 1996, the mother of Amelita passed away, so the latter then took over the management of the business.
She then discovered that there were arrears in the payment of taxes and other government fees, although the
records purported to show that the same were already paid. Amelita then made some changes in the business
operation and private respondent and his wife were no longer allowed to participate in the management thereof. As a
consequence, the latter filed a complaint charging that petitioner had illegally terminated his employment.
- Based on the position papers of the parties, the labor arbiter rendered a decision in favor of petitioner on October
25, 1996 declaring that no employer-employee relationship existed between the parties and, therefore, his office had
no jurisdiction over the case.
- Not satisfied with the said decision, private respondent appealed to the NLRC contending that the labor arbiter erred
(1) in not giving credence to the evidence submitted by him; (2) in holding that he worked as a "volunteer" and not as
an employee of St. Martin Funeral Home from February 6, 1995 to January 23, 1996, or a period of about one year;
and (3) in ruling that there was no employer-employee relationship between him and petitioner.
- On June 13, 1997, the NLRC rendered a resolution setting aside the questioned decision and remanding the case
to the labor arbiter for immediate appropriate proceedings. Petitioner then filed a motion for reconsideration which
was denied by the NLRC in its resolution dated August 18, 1997 for lack of merit, hence the present petition alleging
that the NLRC committed grave abuse of discretion. 7
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ISSUE:
WON the recourse to the SC is proper
HELD:
Yes, through Rule 65 but it should be initially filed in the CA.
RATIO: There is no legal provision for appellate review thereof, the Court nevertheless rejected that thesis. It held
that there is an underlying power of the courts to scrutinize the acts of such agencies on questions of law and
jurisdiction even though no right of review is given by statute; that the purpose of judicial review is to keep the
administrative agency within its jurisdiction and protect the substantial rights of the parties; and that it is that part of
the checks and balances which restricts the separation of powers and forestalls arbitrary and unjust adjudications.
- Pursuant to such ruling, and as sanctioned by subsequent decisions of this Court, the remedy of the aggrieved party
is to timely file a motion for reconsideration as a precondition for any further or subsequent remedy, and then
seasonably avail of the special civil action of certiorari under Rule 65 which is a special original action limited to the
resolution of jurisdictional issues, that is lack or excess of jurisdiction and GAD amounting to lack of jurisdiction.
- The Court is, therefore, of the considered opinion that ever since appeals from the NLRC to the Supreme Court
were eliminated, the legislative intendment was that the special civil action of certiorari was and still is the proper
vehicle for judicial review of decisions of the NLRC. The use of the word "appeal" in relation thereto and in the
instances we have noted could have been a lapsus plumae because appeals by certiorari and the original action for
certiorari are both modes of judicial review addressed to the appellate courts. The important distinction between
them, however, and with which the Court is particularly concerned here is that the special civil action of certiorari is
within the concurrent original jurisdiction of this Court and the Court of Appeals; whereas to indulge in the assumption
that appeals by certiorari to the Supreme Court are allowed would not subserve, but would subvert, the intention of
Congress as expressed in the sponsorship speech on Senate Bill No. 1495.
- Incidentally, it was noted by the sponsor therein that some quarters were of the opinion that recourse from the
NLRC to the Court of Appeals as an initial step in the process of judicial review would be circuitous and would prolong
the proceedings. On the contrary, as he commendably and realistically emphasized, that procedure would be
advantageous to the aggrieved party on this reasoning:
On the other hand xxx to allow these cases to be appealed to the Court of Appeals would give litigants the
advantage to have all the evidence on record be reexamined and reweighed after which the findings of facts and
conclusions of said bodies are correspondingly affirmed, modified or reversed.
Under such guarantee, the Supreme Court can then apply strictly the axiom that factual findings of the Court of
Appeals are final and may not be reversed on appeal to the Supreme Court. A perusal of the records will reveal
appeals which are factual in nature and may, therefore, be dismissed outright by minute resolutions.
- While we do not wish to intrude into the Congressional sphere on the matter of the wisdom of a law, on this score
we add the further observations that there is a growing number of labor cases being elevated to this Court which, not
being a trier of fact, has at times been constrained to remand the case to the NLRC for resolution of unclear or
ambiguous factual findings; that the Court of Appeals is procedurally equipped for that purpose, aside from the
increased number of its component divisions; and that there is undeniably an imperative need for expeditious action
on labor cases as a major aspect of constitutional protection to labor.
- All references in the amended Section 9 of B.P. No. 129 to supposed appeals from the NLRC to the Supreme Court
are interpreted and hereby declared to mean and refer to petitions for certiorari under Rule 65. Consequently, all such
petitions should hence forth be initially filed in the Court of Appeals in strict observance of the doctrine on the
hierarchy of courts as the appropriate forum for the relief desired.

POLICE COMMISSION v BELLO


37 SCRA 230
VILLAMOR; January 30, 1971

FACTS
- Ferrer and Bonifacio (chief of police and corporal of police force of Binmaley, Pnagasinan) were charged
administratively with dishonesty, grave misconduct, serious irregularities in the performance of duty and/or serious
neglect of duty and incompetency. The complaint was filed with the Board of Investigators of Binmaley, Pangasinan.
The report made by the Board recommended the dismissal of the complaint for the charges imputed were not
committed deliberately, but through mistake. The Police Commission (PC), after reviewing the report and records,
found Ferrer and Bonifacio guilty and ordered their dismissal from service.
- Ferrer and Bonifacio then filed with the CFI Pangasinan separate petitions for certiorari with preliminary mandatory
injunction. They contended two grounds: lack of jurisdiction of the PC to render a decision on the administrative case
against them because at that time it had not yet even published its Police Manual as required by Sec. 26 of RA4864
(Police Act of 1966); and that PC committed grave abuse of discretion in dismissing them from the service.
- Judge Bello of CFI Pangasinan issued the contested order ex parte, directing the issuance of a preliminary
mandatory injunction. PC’s motion to dismiss was denied, and another order directing the reinstatement of Ferrer and
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Bonifacio was issued by the same judge.


- PC filed instant petition with SC, seeking to annul the orders of Bello

ISSUE
WON the assailed orders should be annulled

HELD
YES
Ratio The writs in question were improvidently issued. Moreover, the CFI of Pangasinan had no power to issue such
writs against the PC, which holds office in Quezon City
Reasoning It is improper to issue a writ of prelim injunction prior to a final hearing except “in cases of extreme
urgency; where the right is very clear; where considerations of relative inconvenience bear strongly in complainant's
favor; where there is a willful and unlawful invasion of plaintiff's right against his protest and remonstrance, the injury
being a continuing one; and where the effect of the mandatory injunction is rather to reestablish and maintain a pre-
existing continuing relation between the parties, recently and arbitrarily interrupted by the defendant, than to establish
a new relation.” (Manila Electric Railroad and Light Company vs. Del Rosario, etc)
- the principal ground on which petitions in the CFI are predicated is lack of jurisdiction of PC to render a decision in
the administrative case, dismissed officers contending that PC had no such jurisdiction because it had not yet
published a Police Manual when it rendered its decision. However, reading the provisions of the Police Act of 1966
shows that there is a procedure provided so as to allow the Board of Investigators and the PC to function even
without a police manual.
- In any event, considering that the dismissed officers voluntarily submitted themselves to the jurisdiction of the Board
of Investigators, whose decisions are subject to review by PC, they are now barred under the doctrine of estoppel by
laches from questioning the jurisdiction of PC.
- also, CFI Pangasinan has no jurisdiction to issue writs of preliminary mandatory injunction against the PC, which
holds office in Quezon City, outside the territorial boundaries of said court.
- WRT to the issue of grave abuse of discretion, it is contended that PC acted arbitrarily when it dismissed the two
officers. However, the court has held that while findings of fact of administrative bodies are entitled to great weight
and should not generally be disturbed, there is grave abuse of discretion justifying the issuance of the writ of
certiorari when there is such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction
(Abad Santos v Prov of Tarlac), as where power is exercised in an arbitrary or despotic manner by reason of passion,
prejudice, or personal hostility amounting to an evasion of positive duty, or to virtual refusal to perform the duty
enjoined, or to act at all in contemplation of law (Tavera-Luna, Inc. vs. Nable)
- in this case, to grant the petition for permanent prohibition will deprive the dismissed officers of their day in court, for
they can no longer be in a position to prove their allegation
- While it has been shown that the court below exceeded its jurisdiction in issuing the writs of preliminary mandatory
injunction, it has not likewise been shown in the present petition nor has it been alleged therein that the entire
proceedings in the court below are without or in excess of the lower court's jurisdiction, or with grave abuse of
discretion. In passing it must be mentioned that the doctrine in support of the theory of non-jurisdiction is not
applicable to this aspect of the proceedings, the power of judicial review not being confined to the CFI of the locality
where the office of PC is maintained, to the exclusion of the CFI in the locality where private respondents reside.

PURE FOODS CORP V NLRC (CLAVIO, CATUBAY, UMALI, REY, DEL ROSARIO)
171 SCRA 415
REGALADO; March 21, 1989

FACTS
- Remigio Clavio, Andres Catubay, Virgilio Umali, Orlando Rey and Jorge del Rosario were employees of Pure Foods
Corp (PFC). PFC hired Clavio and Catubay as drivers, starting 1979 and 1976, respectively; Umali as utility man,
starting 1978; Rey as delivery man, starting 1973; and Del Rosario as checker, starting 1978. Despite their specific
appointments, there were times when Umali and Del Rosario were required by their superiors to perform the duties of
a dispatcher.
- Of all the employees involved from the packaging to the delivery of the goods, only private respondents were
indefinitely suspended for alleged pilferage (as discovered in an overweight assessment of one of the cargo trucks –
see decision for full details of the alleged pilferage) as early as March 18, 1981, immediately after the incident and
without prior investigation. Thereafter, their suspension was continued until their dismissal without any notice to them
or clearance from the then Ministry of Labor and Employment.
- April 2, 1982 > private respondents filed a complaint for illegal dismissal and unpaid wages against PFC.
- May 13, 1983 > an order was issued by Director Pucan directing PFC to reinstate private respondents to their
former position with full backwages from the date of their dismissal until actual reinstatement, and to pay said
complainants their unpaid wages prior to their dismissal.
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- PFC appealed the order to the Office of then Minister of Labor and Employment. Acting on said appeal, former
Deputy Minister Leogardo issued an order setting aside the order of Director Pucan and indorsing the complaint to
the NLRC-NCR-Arbitration Branch for compulsory arbitration as the nature of the case was not suited for summary
proceeding, the issues involved being evidentiary in nature which could be threshed out in a formal hearing.
- The case was assigned to Labor Arbiter Valenzuela who conducted several hearings. The labor arbiter rendered a
decision finding that except for Clavio, the dismissal of the other complainants to be justified, their complaint
impugning the same should be, as it is hereby DISMISSED. However, for failure to furnish them with a clearance
application for their termination as well as the belated filing of the same with MOLE, PFC, should, as it is hereby,
ordered to pay Umali, del Rosario, Rey and Catubay their separation pay of one-half (In) month pay for every year of
service their respective services and to reinstate Clavio to his former position with one and half (1-1/2) years of
backwages. Both parties appealed to NLRC.
- March 23, 1987 > NLRC rendered a decision unanimously holding for the private respondents and directing PFC to
show proof of immediate compliance to the mandate of this Decision after ten (10) days from receipt thereof.
- April 15, 1987 > The decision was received by the respective counsels of both parties. It became final without any
motion for reconsideration or any other remedy having been filed or taken by petitioner.
- April 28, 1987 > private respondents moved for the issuance of a writ of execution with a copy of the motion
furnished counsel for petitioner on the same date.
- April 30, 1987 > PFC opposed the above motion, filing at the same time its motion for reconsideration
- May 18, 1987 > NLRC issued a resolution denying PFC’s motion for reconsideration for having been filed out of time
and for lack of merit.
- Petitioner contends: NLRC committed a grave abuse of discretion in totally reversing the findings of facts of the
labor arbiter.
- Respondents contend: the questioned decision of NLRC has long become final and executory, for failure of PFC
to file its motion for reconsideration within the 10-day reglementary period, hence the same is no longer legally
susceptible of any amendment, alteration and/or modification and pray for the dismissal of this special civil action for
certiorari

ISSUE
WON PFC’s special civil action for certiorari is valid

HELD
NO
Ratio PD 442 (Labor Code of the Philippines) formerly granted, under A223 thereof, an aggrieved party the remedy
of appeal from a decision of NLRC to the Secretary of Labor. PD 1391, however, amended said Article 223 and
abolished appeals to the Secretary of Labor. But, the losing party is not without recourse. Under the New Rules of
NLRC, a party is allowed to file a motion for reconsideration of any order, resolution or decision of the commission
based on palpable or patent errors, provided that the motion is under oath and filed within ten (10) calendar days
from receipt of the order, resolution or decision. In addition, the party may also seasonably avail of the special civil
action for certiorari, where the tribunal, board or officer exercising judicial functions has acted without or in excess of
its jurisdiction, or with grave abuse of discretion, and praying that judgment be rendered annulling or modifying the
proceedings, as the law requires, of such tribunal, board or officer.
Reasoning The unquestioned rule in this jurisdiction is that certiorari will lie only if there is no appeal or any other
plain, speedy and adequate remedy in the ordinary course of law against the acts of respondent. In the present case,
the plain and adequate remedy expressly provided by law was a motion for reconsideration of the assailed decision
and the resolution thereof, which was not only expected to be but would actually have provided adequate and more
speedy remedy than the present petition for certiorari. This remedy was actually sought to be availed of by PFC when
it filed MFR albeit beyond the 10-day reglementary period. For all intents and purposes, PFC cannot now be heard to
say that there was no plain, speedy and adequate remedy available to it and that it must, therefore, be allowed to
seek relief by certiorari. This contention is not only untenable but would even place a premium on a party's
negligence or indifference in availing of procedural remedies afforded by law. The filing of such MFR is intended to
afford NLRC an opportunity to correct any actual or fancied error attributed to it by way of a re-examination of the
legal and factual aspects of the case. PFC’s inaction or negligence under the circumstances is tantamount to a
deprivation of the right and opportunity of NLRC to cleanse itself of an error unwittingly committed or to vindicate itself
of an act unfairly imputed. An improvident resort to certiorari cannot be used as a tool to circumvent the right of public
respondent to review and purge its decision of an oversight, if any. Neither should this special civil action be resorted
to as a shield from the adverse consequences of petitioner's own negligence or error in the choice of remedies.
Having allowed the decision to become final and executory, PFC cannot by an overdue strategy question the
correctness of the NLRC decision when a timely motion for reconsideration was the legal remedy indicated.
Ratio It is settled to the point of being elementary that the only question involved in certiorari is jurisdiction, either the
want or excess thereof, and abuse of discretion warrants the issuance of the extraordinary remedy of certiorari only
when the same is so grave, as when the power is exercised in an arbitrary or despotic manner by reason of passion,
prejudice or personal hostility, and it must be so patent and so gross as to amount to an evasion of positive duty, or to
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a virtual refusal to perform a duty enjoined, or to act at all, in contemplation of law, as to be equivalent to having acted
without jurisdiction.
Reasoning Firstly, errors of judgment, as distinguished from errors of jurisdiction, are not within the province of a
special civil action for certiorari. Secondly, a careful perusal of the records of this case readily reveals that if there is
any error by public respondent in its analysis of the facts and its evaluation of the evidence, it is not of such a degree
as may be stigmatized as a grave abuse of discretion. By grave abuse of discretion is meant such capricious and
whimsical exercise of judgment as is equivalent to lack of jurisdiction, and it must be shown that the discretion was
exercised arbitrarily or despotically. For certiorari to lie, there must be a capricious, arbitrary and whimsical exercise
of power, the very antithesis of the judicial prerogative in accordance with centuries of both civil law and common law
traditions.
Ratio It must emphatically be reiterated, since so often is it overlooked, that the special civil action for certiorari is a
remedy designed for the correction of errors of jurisdiction and not errors of judgment. The reason for the rule is
simple. When a court exercises its jurisdiction, an error committed while so engaged does not deprive it of the
jurisdiction being exercised when the error is committed. If it did, every error committed by a court would deprive it of
its jurisdiction and every erroneous judgment would be a void judgment. This cannot be allowed. The administration
of justice would not survive such a rule. Consequently, an error of judgment that the court may commit in the exercise
of its jurisdiction is not correctible through the original civil action of certiorari.

AZORES v SEC (PHIL COLUMBIAN ASSOC)


252 SCRA 387
Mendoza, J; 1996

FACTS
- Dr. Antonio Azores became a member of the Philippine Columbian Association in 1952. He was thus issued
Proprietary Membership No. 094 and Membership Certificate no. 282. In 1956, he wrote the Club to request that his
membership status be changed from resident to non-resident in view of his move to San Pablo City. He was later
billed as a non resident member.
- In 1966 petitioner immigrated to the United States to work as Attorney-Adviser in the U.S. Department of
Commerce. Because the position was reserved for American citizens, petitioner obtained American citizenship.
Petitioner simply stopped paying membership dues without informing the PCA of his change of residence and
citizenship.
- Upon his retirement, he came back to the Philippines and tried to activate his membership in the Club. He also
inquired about the price he could get if he were to sell one of his shares. He was told that he had to settle all his dues
to the club. He objected to this condition saying in effect that since he did not avail of the facilities from the time he left
for the US, he should not be made to pay.
- As it turned out, in 1977, all the certificates of membership were recalled for substitution and those that were not
surrendered were cancelled, including those of Azores’. The club however offered to reactivate Azores’ membership
on the condition that only one of his shares would be validated and that he pays one month due for every year of
absence from the Philippines. He refused the offer and instead insisted that his two memberships be activated. The
club stood its ground.
- Petitioner filed a complaint with the Securities and Exchange Commission and after due hearing the SEC sustained
the Club. His appeal was dismissed for having been filed out of time.

ISSUE/S
WON the Securities and Exchange Commission committed abuse of discretion in dismissing his appeal

HELD
No. The failure of a party to perfect his appeal in the manner and within the period fixed by law renders the decision
sought to be appealed final, with the result that no court can exercise appellate jurisdiction to review the decision. For
it is more important that a case be settled than that it be settled right. It is only in exceptional cases when we
have allowed a relaxation of the rules governing the periods of appeals. Petitioner admits that the 30th day for filing
his notice of appeal and memorandum on appeal, as required by the aforesaid rule of the SEC, fell on October 17,
1992 but that he did so only on October 20, 1992. 6 He alleges, however, that October 17 was a Saturday, while
October 18 was a Sunday and that these days should not be counted in determining the period of appeal. In any
event he claims that the delay in filing his appeal was “unintended” because he believed in good faith that October 17
and 18 were nonworking days. Be that as it may, there was no reason why petitioner’s appeal was not filed on
Monday, October 19, 1992.
- Nor is there any showing that the SEC en banc committed the errors attributed to it in the petition. In the first place,
the alleged errors were not committed by the SEC en banc but, if at all, by the Hearing Officer. What petitioner claims
to be errors of the SEC en banc are only the consequence of the dismissal of his appeal. For the fact is that the SEC
en banc did not decide his appeal. What is more, as already stated, the dismissal of petitioner’s appeal was in
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accordance with law and not at all a grave abuse of the Hearing Officer’s discretion. In the second place, this is a
petition for certiorari under Rule 65. As such, even assuming that errors were allegedly committed by the SEC en
banc, the errors are not errors of jurisdiction or grave abuse of discretion. It is not disputed that, under the by-laws of
the PCA, proprietary membership is open only to Filipino citizens10 and that failure to pay dues for three successive
months result in the automatic termination of membership; that petitioner did not pay his monthly dues from 1966 to
1981 when he worked in the United States; and that he did not inform the PCA that he had obtained American
citizenship. There was, therefore, reasonable basis for the decision of the Hearing Officer in dismissing petitioner’s
complaint.

VILLARUEL v. NLRC
284 SCRA 399
MARTINEZ; January 20, 1998

FACTS
- Guarino started working as matter baker at petitioners' bakery known as "Ideal Bakery." His work schedule was horn
6:00 A.M. to 8:00 P.M. and 11:00 P.M. to 6:00 o'clock the following morning.
- Guarino was told by the petitioners not to report for work anymore after he asked for a ten-peso increase of his daily
wage.
- Guarino filed a complaint for recovery of wages, night shift differential, overtime pay, and 13th month pay, which
complaint was later amended 3 to include illegal dismissal with reinstatement or separation pay, payment of
backwages; service incentive leave, moral, exemplary and actual damages plus attorney's fees.
- Petitioners denied Guarino's demands contending that the latter is not an employee but a partner in the bakery
business with a 50-50 sharing from the profits derived therefrom; that private respondent abandoned his work when
he failed to return from vacation; and that they were surprised to know later that private respondent worked in another
bakery which was later known as "7-A".
- Labor Arbiter rendered a decision dismissing the complaint for lack of merit. The labor arbiter ruled that there exists
no employer-employee relationship between the parties and that private respondent's claim for illegal dismissal and
other money claims were without basis.
ship between complainant and respondent hence, complainants claim for Illegal Dismissal and other money claims is
without basis." 6
- Guarino appealed to the NLRC which reversed the labor arbiter's decision. Petitioners moved for a reconsideration
of the decision but the same was denied for lack of merit.

ISSUES
WON an abuse of discretion follows just because there is a reversal by the NLRC of the decision of the labor arbiter

HELD
- NO. Petitioners come to us via this petition for certiorari contending that the NLRC gravely abused its discretion
when:
1. it rendered its decision finding that private respondent was a regular employee of petitioner and not a partner.
2. it found that private respondent did not abandon the partnership and transfer to another bakery.
3. it directed the petitioners to pay private respondent salary differentials, overtime pay, holiday premium, 13th month
pay for 1988 to 1990 and night shift differential.
- The petition essentially raises a factual issue. We have time and again ruled that the jurisdiction of this Court to
review a decision or resolution of the NLRC, in a petition for certiorari under Rule 65 of the Rules of Court, does not
include a correction of its evaluation of the evidence but is confined to issues of jurisdiction or grave abuse of
discretion. Grave abuse of discretion is committed when the judgment is rendered in a capricious, whimsical, arbitrary
or despotic manner. An abuse of discretion does not necessarily follow just because there is a reversal by the NLRC
of the decision of the labor arbiter, such as the case at bench. Neither does the mere variance in the evidentiary
assessment of the NLRC and that of the labor arbiter warrant another full review of the facts.
- The NLRC's factual findings if supported by substantial evidence, is entitled to great respect and even finality,
unless petitioner is able to show that it simply and arbitrarily disregarded evidence before it or had misapprehended
evidence to such an extent as to compel a conclusion if such evidence had been properly appreciated.
- The NLRC ruling that there is an employer-employee relationship between the petitioners and the private
respondent is supported by substantial evidence as can be gleaned from a reading of the assailed decision. On the
other Land the Labor Arbiter's finding that a partnership exists between the petitioners and private respondent is
unsupported by any documentary evidence.
- On the issue of abandonment, the Labor Arbiter's conclusion that private respondent abandoned his work to transfer
to a better-paying job in another bakery, as correctly observed by the NLRC, is likewise devoid of factual support.
Private respondent transferred to 7-A Bakery only after he was told by the petitioner not to report for work anymore.
Understandably, he had to look for another job to support himself and more importantly, his family.
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- Finally the dismissal of private respondent being illegal, he is entitled to the monetary claims prayed for, that is,
salary differentials, overtime pay, holiday premium, 13th month pay for the years 1988, 1989 and 1990, and night shift
differentials which we assume to be correct computations thereof. Since private respondent is now employed with
another employer and has no desire to be reinstated, he is entitled to separation pay equivalent to 1 month's salary
for every year of service.

CIR v GENERAL FOODS INC.


G.R. No. 143672
CORONA; April 24, 2003

FACTS
- General Foods, which is engaged in the manufacture of Tang, Calumet and Kool-Aid, filed its income tax return for
the fiscal year ending February 28, 1985. In said tax return it claimed as deduction, among other business expenses,
the amount of P9,461,246 for media advertising for "Tang." The Commissioner disallowed 50% or P4,730,623 of the
deduction claimed. Consequently, respondent corporation was assessed deficiency income taxes in the amount of
P2,635, 141.42. General Foods filed a motion for reconsideration but the same was denied. It appealed to the Court
of Tax Appeals but it was dismissed.
- Aggrieved, General Foods file a petition for review at the Court of Appeals which rendered a decision reversing and
setting aside the decision of the Court of Tax Appeals. It said that since it has not been sufficiently established that
the item it claimed as a deduction is excessive, the same should be allowed.Thus, the instant petition.

ISSUE
WON the subject media advertising expense for "Tang" incurred by General Foods was an ordinary and necessary
expense fully deductible under the National Internal Revenue Code (NIRC).

HELD
NO.
- To be deductible from gross income, the subject advertising expense must comply with the following requisites: (a)
the expense must be ordinary and necessary; (b) it must have been paid or incurred during the taxable year; (c) it
must have been paid or incurred in carrying on the trade or business of the taxpayer; and (d) it must be supported by
receipts, records or other pertinent papers.
- The parties are in agreement that the subject advertising expense was paid or incurred within the corresponding
taxable year and was incurred in carrying on a trade or business. Hence, it was necessary. However, their views
conflict as to whether or not it was ordinary. To be deductible, an advertising expense should not only be necessary
but also ordinary. These two requirements must be met.
- The Commissioner maintains that the subject advertising expense was not ordinary on the ground that it failed the
two conditions set by U.S. jurisprudence: first, "reasonableness" of the amount incurred and second, the amount
incurred must not be a capital outlay to create "goodwill" for the product and/or company’s business. Otherwise, the
expense must be considered a capital expenditure to be spread out over a reasonable time.
- In the case at bar, the P9,461,246 claimed as media advertising expense for "Tang" alone was almost one-half of its
total claim for "marketing expenses." Aside from that, respondent-corporation also claimed P2,678,328 as "other
advertising and promotions expense" and another P1,548,614, for consumer promotion.
Furthermore, the subject P9,461,246 media advertising expense for "Tang" was almost double the amount of
respondent corporation’s P4,640,636 general and administrative expenses.
We find the subject expense for the advertisement of a single product to be inordinately large. Therefore, even if it is
necessary, it cannot be considered an ordinary expense deductible under then Section 29 (a) (1) (A) of the NIRC.
- Advertising is generally of two kinds: (1) advertising to stimulate the current sale of merchandise or use of services
and (2) advertising designed to stimulate the future sale of merchandise or use of services. The second type involves
expenditures incurred, in whole or in part, to create or maintain some form of goodwill for the taxpayer’s trade or
business or for the industry or profession of which the taxpayer is a member.
- We agree with the Court of Tax Appeals that the subject advertising expense was of the second kind. General
Foods incurred the subject advertising expense in order to protect its brand franchise. We consider this as a capital
outlay since it created goodwill for its business and/or product. The P9,461,246 media advertising expense for the
promotion of a single product is doubtlessly unreasonable.
- It has been a long standing policy and practice of the Court to respect the conclusions of quasi-judicial agencies
such as the Court of Tax Appeals, a highly specialized body specifically created for the purpose of reviewing tax
cases. The CTA, by the nature of its functions, is dedicated exclusively to the study and consideration of tax
problems. It has necessarily developed an expertise on the subject. We extend due consideration to its opinion
unless there is an abuse or improvident exercise of authority. Since there is none in the case at bar, the Court
adheres to the findings of the CTA.
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- Accordingly, we find that the Court of Appeals committed reversible error when it declared the subject media
advertising expense to be deductible as an ordinary and necessary expense on the ground that "it has not been
established that the item being claimed as deduction is excessive." It is not incumbent upon the taxing authority to
prove that the amount of items being claimed is unreasonable. The burden of proof to establish the validity of claimed
deductions is on the taxpayer. In the present case, that burden was not discharged satisfactorily.

CRUZ V. GANGAN

Date: January 22, 2003


Ponente: Panganiban, J.
Nature: Certiorari under Rule 64

FACTS
 January 15 1999: Filonila Cruz (CAMANAVA district director of TESDA) went to the Regional Office of
TESDA10 in Taguig for consultation with the director. After her meeting, she took the LRT to go to her office in
Caloocan. On the trip, her bag was slashed and its contents (wallet and government-issued cellphone 11) were
stolen by an unknown person. The same day, she reported the incident and the police investigated however the
items were not recovered.
 3 days later: Cruz reported the theft to the regional director of TESDA through a Memorandum wherein she
also requested that she be relieved from accountability of the cellphone.
 1st indorsement (January 19): regional director indorsed her request to the resident auditor.
 2nd indorsement (January 20): resident auditor denied Cruz’s request because she lacked diligence required
in custody of government property and ordered to pay P4,238 for the cellphone and cellphone case.
 National Government Audit Office II: sustained resident auditor
 Commission on Audit: affirmed National Government Audit Office that there was no justification for request of
relief because Cruz failed to exercise due diligence to prevent the loss by taking an overcrowded LRT and
exposing herself to pickpockets. (Nakpil vs CA: One who creates a dangerous condition cannot escape liability
although an act of God may have intervened)

ISSUES/HELD
1. W/N Cruz was negligent in the care of the government-issued cellphone – NO
2. W/N she should be held accountable – NO

RATIO12
1. Riding the LRT cannot per se be denounced as a negligent 13 act, more so under the circumstances in this case, in
which Cruz’s mode of transit was influenced by time and money considerations. She had to take the LRT to arrive in
time in Caloocan where she had a 3:00 meeting (her meeting in Taguig ended at 2:00/2:30). Any prudent or rational
person under similar circumstances can reasonably be expected to do the same. Possession of a cellular phone
would not and should not hinder one from boarding LRT as she did. After all, whether she took a bus or a jeepney, the
risk of theft would have also been present. Because of her relatively low position and pay, she was not expected to
have her own vehicle or to ride a taxicab. Neither had the government granted her the use of any vehicle. The Rules
Implementing Code of Conduct and Ethical Standards for Public Officials and Employees provide that property for
official use and purpose shall be used with the diligence 14 of a good father of the family. Extraordinary measures are
not called for in the care of a cellphone while in transit. Placing it in hidden in a bag and holding on to the bag is
ordinarily sufficient care of cellphone while travelling (as was done by Cruz). Also, it is settled that negligence can’t be
presumed, thus the COA gravely abused its discretion by finding Cruz negligent in the absence of evidence. The
findings of fact of an administrative agency must be respected by the Court as long as they’re supported by
substantial evidence, but in this case the factual finding of the COA lacks support, cannot stand on its own and is
therefore not binding upon Court.

10
Technological Education and Skills Development Authority
11
Nokia 909 Analog
12
Her dogged persistence in pursuing this appeal has not been lost on this Court. We agree that, in fighting for her rights, she must
have spent more than the value of the lost cellular phone. Hence, we can only applaud her for being true to her calling as an
educator and a role model for our young people. Honor, respect and dignity are the values she has pursued. May her tribe increase!
13
Negligence is the omission to do something a reasonable man, guided upon those considerations which ordinarily regulate
conduct of human affairs, would do or the doing of something which a prudent and reasonable man would not do. It is the want of
care required by circumstances.
14
Diligence with which the law requires individual at all times to govern his conduct varies with the nature of the situation and the
importance of the act which he is to perform.
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2. Within 30 days of loss, Cruz applied for relief from accountability. Such application is deemed a notification of loss
of the cellphone. She has done her part in proving that loss was due to robbery. The resident auditor and COA even
accepted that robbery indeed took place. Necessarily, in the absence of evidence showing negligence on her part,
credit for the loss of the cellular phone is proper under the law. P4,23815 should thus be refunded to her.

- Gia Comsti -

HADJI-SIRAD V. CSC
August 28, 2009
Chico-Nazario, J.:

Facts: On Feb 4, 2002, Hadji-Sirad was charged by CSCRO No. XII with Dishonesty, Grave Misconduct and Conduct
Prejudicial to the Best Interest of the Service. Hadji-Sirad is an employee of the Commission on Audit (COA) in the
Autonomous Region for Muslim Mindanao. In her Personal Data Sheet to support her appointment as State Auditor I,
she indicated that she possesses Career Service Professional Eligibility having passed it on Oct 17, 1993 with a
rating of 88.31%. The PDS was compared with the examination records and it revealed that the examinee Hadji Sirad
looks older than the true Hadji Sirad despite the fact that the examination was conducted in 1993 while the PDS was
accomplished in 1994 and that the signature in the seat plan used slating strokes while the appointee used vertical
strokes.

The result of the investigation concluded that Hadji-Sirad allowed another person to take the Oct 17, 1993 Career
Service Professional Examination. The prosecution presented evidence showing that Hadji-Sirad previously took and
failed the CSPE held on Nov 29, 1992 at Room 26 in Iligan City. Hadji-Sirad admitted this when she took the witness
stand. However, she claims that she also took the exam on Oct 17 1993 and that the pictures in the seat plan and
PDS are both hers. She presented Adelaida L. Casanguan to testify that she took the exam and saw Hadji-Sirad also
took it in the same room. Another witness, Dick U. Yasa, then Personnel Specialist II of CSCRO No. XII, testified that
he saw Hadji-Sirad in the room at around 7:00 to 7:30.

Decision of CSCRO No. XII- Guilty- penalty of dismissal


Reconsideration- denied
Appeal to CSC- affirmed CSCRO
Reconsideration-denied
CA- via certiorari under Rule 65 of the 1997 Revised Rules of Civil Procedure denied for being a wrong mode of
appeal, should have filed a petition for review under Rule 43

Issue: WON rule 65 is the proper remedy. (Topic)


Held: No
Ratio:
Section 50, Rule III of the Uniform Rules on Administrative Cases in the CSC states that a party may elevate a
decision of the Commission before the Court of Appeals by way of a petition for review under Rule 43 of the 1997
Revised Rules of Court.
Sections 1 and 5, Rule 43 of the 1997 Revised Rules of Civil Procedure, as amended, provide that final orders or
resolutions of the CSC are appealable to the Court of Appeals through a petition for review, to wit:
SECTION 1. Scope. - This Rule shall apply to appeals from judgments or final orders of the Court of Tax Appeals and
from awards, judgments, final orders or resolutions of or authorized by any quasi-judicial agency in the exercise of
quasi judicial functions. Among these agencies are the Civil Service Commission, Central Board of Assessment
Appeals, Securities and Exchange Commission, Office of the President, Land Registration Authority, Social Security
Commission, Civil Aeronautics Board, Bureau of Patents, Trademarks and Technology Transfer, National
Electrification Administration, Energy Regulatory Board, National Telecommunications Commission, Department of
Agrarian Reform under Republic Act. No. 6657, Government Service Insurance System, Employees Compensation
Commission, Agricultural Inventions Board, Insurance Commission, Philippine Atomic Energy Commission, Board of
Investments, Construction Industry Arbitration Commission, and voluntary arbitrators authorized by law.
SEC. 5. How appeal taken. –Appeal shall be taken by filing a verified petition for review in seven (7) legible copies
with the Court of Appeals, with proof of service of a copy thereof on the adverse party and on the court or agency a
quo. The original copy of the petition intended for the Court of Appeals shall be indicated as such by the petitioner.
She had 15 days or until 20 December 2007 to file a petition for review with the Court of Appeals. However, she filed
instead a Petition for Certiorari on 27 December 2007, already 22 days after receipt of a copy of CSC Resolution.
A special civil action for certiorari is not a substitute for a lost or lapsed remedy of appeal. A special civil action for
certiorari under Rule 65 of the 1997 Revised Rules of Civil Procedure lies only when there is no appeal or plain,

15
P3,988 for cellphone + P250 for cellphone case: she paid on June 3, 1999 (her retirement day upon reaching 65)
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speedy and adequate remedy in the ordinary course of law. Certiorari is not allowed when a party to a case fails to
appeal a judgment or final order despite the availability of that remedy. The remedies of appeal and certiorari are
mutually exclusive and not alternative or successive. In this case, she utterly failed to provide any justification for her
resort to a special civil action for certiorari, when the remedy of appeal by petition for review was clearly available.
(Please check the case for the discussion regarding the other minor issues)

- Al Hajim -

C. PROHIBITION

CHUA HIONG vs.THE DEPORTATION BOARD


96 PHIL 665
LABRADOR; March 19, 1955

FACTS
- Proceedings were instituted before the Deportation Board against the petitioner, Federico M. Chua Hiong, who is
alleged to have secured the cancellation of his alien certificate of registration with the Bureau of Immigration through
fraud and misrepresentation (in claiming to be an illegitimate child of a Filipino mother named Tita Umandap when as
a matter of fact he is the legitimate child of a Chinese woman by the name of Sy Mua) and to have maliciously and
illegally exercised privileges and rights belonging to citizens of the Philippines, such as the right of suffrage, the
acquisition of real estate and lumber concessions, knowing that he is a Chinese national.
- Upon the institution of the proceedings, a warrant for his arrest was issued. He filed a bond for his release and
thereafter petition said Deportation Board for the dismissal of the proceedings against him.

PROCEDURE
- Motion to quash - denied by the Deportation Board.
- These proceedings were instituted in this Court seeking the following reliefs:
a. that a Writ of habeas corpus be issued on the ground that his arrest was made without jurisdiction, as the claim
submitted by him of his Filipino citizenship is supported by evidence;
b. that the Board be prohibited from continuing the deportation proceedings against him;
c. that a writ of preliminary injunction issue to restrain the Deportation Board from hearing the case until after his
petition is heard by SC
Petitioner’s claim: The legal foundation of the petitioners claim is contained in three propositions, namely, (a) that
only an alien is subject to deportation or repatriation, and that when a resident denies that he is an alien and claims to
be a citizen of the Philippines, he challenges or puts in issue a jurisdictional fact, alienage; (b) that the evidence
which he has submitted to the Deportation Board as to his Filipino citizenship is substantial, for as a matter of fact
various officials of the executive department have recognized such citizenship and had made a finding that he is not
subject to the provisions of the Alien Registration Act; and (c) that as his liberty as a citizen is involved, the
constitutional guarantee of due process of law demands that his alleged citizenship should first be determined in
judicial proceedings. The first proposition above set forth is admitted in the return. It is well settled that proceedings
for deportation or repatriation can be instituted only against aliens.

ISSUES
1. WON mere plea of citizenship does not divest the Deportation Board of its power over the deportation proceedings
2. WON a respondent who claims to be a citizen and not therefore subject to deportation has the right to have his
citizenship reviewed by the courts, after the deportation proceedings.

HELD
1. YES.
Ratio If the alienage of the respondent is not denied, the Board's jurisdiction and its proceedings are unassailable; if
the respondent is admittedly a citizen, or conclusively shown to be such, the Board lacks jurisdiction and its
proceedings are null and void ab initio and may be summarily enjoined in the courts.
2. YES.
Ratio When the evidence submitted by a respondent is conclusive of his citizenship, the right to immediate review
should also be recognized and the courts should promptly enjoin the deportation proceedings. A citizen is entitled to
live in peace, without molestation from any official or authority, and if he is disturbed by a deportation proceedings, he
has the unquestionable right to resort to the courts for his protection, either by a writ of habeas corpus or of
prohibition, on the legal ground that the Board lacks jurisdiction. The legal basis of the prohibition is the absence of
the jurisdictional fact, alienage.
Reasoning If the citizen's right to his peace is to be protected, it must be protected preferably through the medium of
the courts, because these are independent of the other branches of the government and only in their proceedings can
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we find guarantees of impartiality and correctness, within human limitations, in the ascertainment of the jurisdictional
fact in issue, the respondent's claim of citizenship.

CO V THE DEPORTATION BOARD


320 SCRA 478
FERNANDO; July 29, 1977

FACTS
-Co Pengco, father of petitioners Gregorio and Heculano Co, was a Chinese merchant residing in Cagayan; their
mother, Maria Tan Comin’s nationality was disputed. Upon petitioners parents’ death in China, a Special Prosecutor
of the Deportation Board filed charges against them alleging that as Chinese subjects residing in the Philippines, they
violated the law in their failure to register as Chinese nationals with Immigration. By representing themselves as
Filipinos, they were able to enjoy rights and privileges only accorded to citizens such as ownership of real property.
Upon the dismissal of both a motion to dismiss and MFR, petitioners filed an action for prohibition and habeas corpus
against the Board during the pendency of an inquiry against them which could possibly lead to their expulsion from
the country. The then Judge de Veyra of the Manila CFI sustained his jurisdiction, granted the relief sought, and
restrained the Board from taking cognizance of the proceeding. Hence this appeal by the Board.

ISSUE
WON judicial intervention prior to the final decision of the Board was justified

HELD
YES.
As held in Chua Hiong vs Deportation Board, “when the evidence submitted…is conclusive of his citizenship, the right
to immediate review should also be recognized and the courts should promptly ejoin the deportation proceedings.”
Such remedy should be allowed only in sound discretion of a competent court in a proper proceeding, as was in the
instant case.
-Calacday vs Vivo reiterated the exception to the rule precluding judicial intervention until deportation proceedings are
completed. There was no substantial legal error in the test of evidence to justify such remedy based on the evidence
of their citizenship, such as having been born in the Philippines to a Filipino Mother (as recognized by the lower
court); the recognition of such status by several government agencies; their exercise of the right to suffrage; and birth
certificates showing they are Filipinos.

SIMON, JR. v COMMISSION ON HUMAN RIGHTS


229 SCRA 117
VITUG; January 5, 1994

FACTS
- A Demolition Notice signed by Quimpo (one of the petitioners), Executive Officer of the Quezon City Integrated
Hawkers Management Council under the Office of the City Mayor, was sent to, and received by, the private
respondents (officers and members of the North EDSA Vendors Association, Incorporated). In said notice, the
respondents were given a grace-period of three 3 days within which to vacate the questioned premises of North
EDSA. Prior to their receipt of the demolition notice, the private respondents were informed by petitioner Quimpo that
their stalls should be removed to give way to the "People's Park". The group filed a letter-complaint with the CHR
against the petitioners, asking the late CHR Chairman Bautista for a letter to be addressed to then Mayor Brigido
Simon, Jr., of Quezon City to stop the demolition of the private respondents' stalls, sari-sari stores, and carinderia
along North EDSA. The CHR issued an Order, directing the petitioners "to desist from demolishing the stalls and
shanties at North EDSA pending resolution of the vendors/squatters' complaint before the Commission" and ordering
said petitioners to appear before the CHR.
- A motion to dismiss questioned CHR's jurisdiction. Petitioners stated that the Commission's authority should be
understood as being confined only to the investigation of violations of civil and political rights, and that "the rights
allegedly violated in this case were not civil and political rights, but their privilege to engage in business."
- The CHR denied the motion, holding that it had jurisdiction over the complaint filed by the squatters-vendors who
complained of the gross violations of their human and constitutional rights. Petitioners' motion for reconsideration was
denied. Hence, this petition.

HELD
NO.
The constitutional provision directing the CHR to "provide for preventive measures and legal aid services to the
underprivileged whose human rights have been violated or need protection" may not be construed to confer
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jurisdiction on the Commission to issue a restraining order or writ of injunction for, it that were the intention, the
Constitution would have expressly said so. "Jurisdiction is conferred only by the Constitution or by law". It is never
derived by implication.
Evidently, the "preventive measures and legal aid services" mentioned in the Constitution refer to extrajudicial and
judicial remedies (including a writ of preliminary injunction) which the CHR may seek from proper courts on behalf of
the victims of human rights violations. Not being a court of justice, the CHR itself has no jurisdiction to issue the writ,
for a writ of preliminary injunction may only be issued "by the judge of any court in which the action is pending within
his district, or by a Justice of the Court of Appeals, or of the Supreme Court. A writ of preliminary injunction is an
ancillary remedy. It is available only in a pending principal action, for the preservation or protection of the rights and
interests of a party thereto, and for no other purpose.
The Commission does have legal standing to indorse, for appropriate action, its findings and recommendations to any
appropriate agency of government.

PAREDES V CA
253 SCRA 126
KAPUNAN, February 1, 1996

FACTS
-Secretary of DTI and Director of Bureau of Patents, Trademarks and Technology Transfer (BPTTT) promulgated A.O.
1 and 2, Series of 1992 revising the rules of practice before the BPTTT in patent and trademark cases. Among the
revisions made were the increase in fees payable to the BPTTT for registration of patents and trademarks and the
prohibition of filing multi-class applications (one application covering several classes of goods). Petitioners –
registered patent agents – after requesting the respondents to reconsider or defer the implementation of the AO, filed
with CA a Petition for Prohibition with prayer for the issuance of a Writ of Preliminary Injunction to stop public
respondents from enforcing the said AO and to declare them null and void for failure to comply with requirements of
Cabinet approval and publication (Sec2 and 5, BP325). CA dismissed, MFR denied.

ISSUES
1. WON there are administrative remedies available to the petitioners
2 WON there was valid publication of the AOs through EO 159 (as argued by the respondents)
3. WON the rate increases and charges are just and reasonably sufficient to cover administrative costs, and/or
practicable and uniform for similar or comparable services and functions, and/or that those rates conform with the
rules and regulations of the Ministry of Finance

HELD
1. YES, and the petition is premature
Ratio. Where the enabling statute indicates a procedure for administrative review, and provides a system of
administrative appeal, or reconsideration, the courts, for reasons of law, comity and convenience, will not entertain a
case unless the available administrative remedies have been resorted to and the appropriate authorities have been
given opportunity to act and correct the errors committed in the administrative forum. (Chua Huat v. CA)
Reasoning. Prohibition is not the proper remedy. The enabling law itself (BP 325) has specifically tasked the Cabinet
to review and approve any proposed revisions of rates of fees and charges. Our legislature in delegating to
administrative officers the authority to revise fees and charges expressly required cabinet approval for the proper
exercise of said power. The grant (or denial) of a writ of prohibition is ordinarily within the sound discretion of the court
to be exercised with caution and forbearance, according to the circumstances of the particular case, and only where
the right to seek relief is clear. Prohibition is granted only in cases where no other remedy is available which is
sufficient to afford redress. That the petitioners have another and complete remedy at law either by appeal or
otherwise, is generally a sufficient reason for dismissing the writ.
-BP325 provides a three-step process involving a hierarchy of authority before the rate increases and charges can be
imposed and collected. First, the BPTTT, which is the imposing and collecting agency, makes a recommendation of
the fee increases and charges. Those recommended rates and charges are submitted to the Secretary of the DTI for
his evaluation and approval. Second, if the Secretary of the DTI finds that the rate increases and charges conform
with the rules and regulations of the Ministry of Finance, then the same are approved and in turn become the rates of
the department. The determination of the supposed rates and charges does not end here. As mentioned in Section
2 above; the rates as determined by the department head are “subject to the approval of the Cabinet.”
2. NO, however, the AOs are not null and void for failure of publication
Reasoning. Laws shall have prospective effect. EO 159 was promulgated 2 years after the subject AOs were issued,
and therefore, has no application in the case at bench.
-NOT NULL AND VOID: Cabinet has yet to review and approve the proposed revised rates of fees and charges so
there can be no proper publication. In accordance with Sec5 of BP325, only upon review and approval by the Cabinet
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of the adjusted rates of fees or charges would the heads of ministries, offices, agencies or commissions concerned
cause the revised schedule of fees and charges to be published.
3. Premature. No ruling.
Reasoning. Courts should be reluctant to interfere with administrative action prior to its completion or finality, the
reason being that absence of a final order or decision, the power of the administrative agency concerned has not
been fully exercised and there can be no irreparable harm. [Matienzo v Abellera]
-ROCHESTER TELEPHONE CO V US, FEDERAL POWER COMMISSION V METROPOLITAN EDISON CO: rule of finality of
administrative action for purposes of judicial review
-The principle of exhaustion of administrative remedies which mandates that relief should first be sought from the
highest or most superior admistrative agency, the likes of the Cabinet, may prove that a resort to the courts would be
unnecessary (Wee Poco vs. Posadas, 65 Phil. 648), prevent the courts from being swamped by a resort to them in
the first instance (U.S. vs. Sing Tuck, 194 U.S. 161), strengthened by the rule on comity and convenience which
requires Us to raise our hands until the administrative process has been finally completed (Matienzo vs. Abellana,
supra; Railroad and Warehouse Commission vs. Duluth, St. R. Co., 273 US 625), and thus it is after judicial review is
no longer premature that the courts may ascertain, in process cases, whether the administrative action or findings are
not in violation of law, whether they are free from fraud or imposition and whether they find substantial support from
the evidence.
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