Ople v Torres G.R. No. 127685. July 23, 1998.

Facts: Petitioner Ople prays that we invalidate Administrative Order No. 308
entitled "Adoption of a National Computerized Identification Reference System"
on two important constitutional grounds, viz: one, it is a usurpation of the
power of Congress to legislate, and two, it impermissibly intrudes on our
citizenry's protected zone of privacy. We grant the petition for the rights sought
to be vindicated by the petitioner need stronger barriers against further
erosion.

A.O. No. 308 was published in four newspapers of general circulation on

January 22, 1997 and January 23, 1997. On January 24, 1997, petitioner filed
the instant petition against respondents, then Executive Secretary Ruben
Torres and the heads of the government agencies, who as members of the
Inter-Agency Coordinating Committee, are charged with the implementation of
A.O. No. 308. On April 8, 1997, we issued a temporary restraining order
enjoining its implementation.

Issue: Petitioner contends:

A. THE ESTABLISHMENT OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM REQUIRES A LEGISLATIVE ACT. THE
ISSUANCE OF A.O. NO. 308 BY THE PRESIDENT OF THE REPUBLIC OF THE
PHILIPPINES IS, THEREFORE, AN UNCONSTITUTIONAL USURPATION OF
THE LEGISLATIVE POWERS OF THE CONGRESS OF THE REPUBLIC OF THE
PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY THE PRESIDENT FOR
THE IMPLEMENTATION OF A.O. NO. 308 IS AN UNCONSTITUTIONAL
USURPATION OF THE EXCLUSIVE RIGHT OF CONGRESS TO APPROPRIATE
PUBLIC FUNDS FOR EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308 INSIDIOUSLY LAYS THE
GROUNDWORK FOR A SYSTEM WHICH WILL VIOLATE THE BILL OF RIGHTS
ENSHRINED IN THE CONSTITUTION."

Held: IN VIEW WHEREOF, the petition is granted and Administrative Order

No. 308 entitled "Adoption of a National Computerized Identification Reference
System" declared null and void for being unconstitutional. SO ORDERED.
Ratio: It cannot be simplistically argued that A.O. No. 308 merely
implements the Administrative Code of 1987. It establishes for the first time a
National Computerized Identification Reference System. Such a System
requires a delicate adjustment of various contending state policies — the
primacy of national security, the extent of privacy interest against dossier-
gathering by government, the choice of policies, etc. Indeed, the dissent of Mr.
Justice Mendoza states that the A.O. No. 308 involves the all-important
freedom of thought.

Nor is it correct to argue as the dissenters do that A.O. No. 308 is not a law
because it confers no right, imposes no duty, affords no protection, and creates
no office. Under A.O. No. 308, a citizen cannot transact business with
government agencies delivering basic services to the people without the
contemplated identification card. No citizen will refuse to get this identification
card for no one can avoid dealing with government. It is thus clear as daylight
that without the ID, a citizen will have difficulty exercising his rights and
enjoying his privileges. Given this reality, the contention that A.O. No. 308
gives no right and imposes no duty cannot stand.

In view of standing
Petitioner Ople is a distinguished member of our Senate. As a Senator,
petitioner is possessed of the requisite standing to bring suit raising the issue
that the issuance of A.O. No. 308 is a usurpation of legislative power. As
taxpayer and member of the Government Service Insurance System (GSIS),
petitioner can also impugn the legality of the misalignment of public funds and
the misuse of GSIS funds to implement A.O. No. 308.

The ripeness for adjudication of the petition at bar is not affected by the fact
that the implementing rules of A.O. No. 308 have yet to be promulgated.
Petitioner Ople assails A.O. No. 308 as invalid per se and as infirmed on its
face. His action is not premature for the rules yet to be promulgated cannot
cure its fatal defects. Moreover, the respondents themselves have started the
implementation of A.O. No. 308 without waiting for the rules. As early as
January 19, 1997, respondent Social Security System (SSS) caused the
publication of a notice to bid for the manufacture of the National Identification
(ID) card.
In view of the need for Legislative Act
An administrative order is an ordinance issued by the President which
relates to specific aspects in the administrative operation of government. It
must be in harmony with the law and should be for the sole purpose of
implementing the law and carrying out the legislative policy.

Administrative power is concerned with the work of applying policies and

enforcing orders as determined by proper governmental organs. 21 It enables
the President to fix a uniform standard of administrative efficiency and check
the official conduct of his agents. To this end, he can issue administrative
orders, rules and regulations.
Prescinding from these precepts, we hold that A.O. No. 308 involves a subject
that is not appropriate to be covered by an administrative order. An
administrative order is:
"Sec. 3. Administrative Orders. — Acts of the President which relate to
particular aspects of governmental operation in pursuance of his duties as
administrative head shall be promulgated in administrative orders."

Petitioner claims that A.O. No. 308 is not a mere administrative order but a
law and hence, beyond the power of the President to issue. He alleges that A.O.
No. 308 establishes a system of identification that is all-encompassing in
scope, affects the life and liberty of every Filipino citizen and foreign resident,
and more particularly, violates their right to privacy.
Petitioner's sedulous concern for the Executive not to trespass on the
lawmaking domain of Congress is understandable. The blurring of the
demarcation line between the power of the Legislature to make laws and the
power of the Executive to execute laws will disturb their delicate balance of
power and cannot be allowed.

In view of right to privacy

Unlike the dissenters, we prescind from the premise that the right to
privacy is a fundamental right guaranteed by the Constitution, hence, it is the
burden of government to show that A.O. No. 308 is justified by some
compelling state interest and that it is narrowly drawn. A.O. No. 308 is
predicated on two considerations: (1) the need to provide our citizens and
foreigners with the facility to conveniently transact business with basic service
and social security providers and other government instrumentalities and (2)
the need to reduce, if not totally eradicate, fraudulent transactions and
misrepresentations by persons seeking basic services. It is debatable whether
these interests are compelling enough to warrant the issuance of A.O. No. 308.
But what is not arguable is the broadness, the vagueness, the overbreadth of
A.O. No. 308 which if implemented will put our people's right to privacy in clear
and present danger.

The heart of A.O. No. 308 lies in its Section 4 which provides for a
Population Reference Number (PRN) as a "common reference number to
establish a linkage among concerned agencies" through the use of "Biometrics
Technology" and "computer application designs." A.O. No. 308 should also
raise our antennas for a further look will show that it does not state whether
encoding of data is limited to biological information alone for identification
purposes. In fact, the Solicitor General claims that the adoption of the
Identification Reference System will contribute to the "generation of population
data for development planning." This is an admission that the PRN will not be
used solely for identification but for the generation of other data with remote
relation to the avowed purposes of A.O. No. 308. Clearly, the indefiniteness of
A.O. No. 308 can give the government the roving authority to store and retrieve
information for a purpose other than the identification of the individual
through his PRN .

His transactions with the government agency will necessarily be recorded —

whether it be in the computer or in the documentary file of the agency. The
individual's file may include his transactions for loan availments, income tax
returns, statement of assets and liabilities, reimbursements for medication,
hospitalization, etc. The more frequent the use of the PRN, the better the
chance of building a huge and formidable information base through the
electronic linkage of the files. The data may be gathered for gainful and useful
government purposes; but the existence of this vast reservoir of personal
information constitutes a covert invitation to misuse, a temptation that may be
too great for some of our authorities to resist.

Well to note, the computer linkage gives other government agencies access
to the information. Yet, there are no controls to guard against leakage of
information. When the access code of the control programs of the particular
computer system is broken, an intruder, without fear of sanction or penalty,
can make use of the data for whatever purpose, or worse, manipulate the data
stored within the system. It is plain and we hold that A.O. No. 308 falls short of
assuring that personal information which will be gathered about our people will
only be processed for unequivocally specified purposes. 60 The lack of proper
safeguards in this regard of A.O. No. 308 may interfere with the individual's
liberty of abode and travel by enabling authorities to track down his movement;
it may also enable unscrupulous persons to access confidential information
and circumvent the right against self-incrimination; it may pave the way for
"fishing expeditions" by government authorities and evade the right against
unreasonable searches and seizures. The possibilities of abuse and misuse of
the PRN, biometrics and computer technology are accentuated when we
consider that the individual lacks control over what can be read or placed on
his ID, much less verify the correctness of the data encoded. They threaten the
very abuses that the Bill of Rights seeks to prevent.

In Morfe v. Mutuc, we upheld the constitutionality of R.A. 3019, the Anti-

Graft and Corrupt Practices Act, as a valid police power measure. We declared
that the law, in compelling a public officer to make an annual report disclosing
his assets and liabilities, his sources of income and expenses, did not infringe
on the individual's right to privacy. The law was enacted to promote morality in
public administration by curtailing and minimizing the opportunities for official
corruption and maintaining a standard of honesty in the public service.

In no uncertain terms, we also underscore that the right to privacy does not
bar all incursions into individual privacy. The right is not intended to stifle
scientific and technological advancements that enhance public service and the
common good. It merely requires that the law be narrowly focused and a
compelling interest justify such intrusions. Intrusions into the right must be
accompanied by proper safeguards and well-defined standards to prevent
unconstitutional invasions.

G.R. No. 78385 August 31, 1987 | PHILIPPINE CONSUMERS

FOUNDATION, INC., Petitioner, vs. THE SECRETARY OF EDUCATION,
CULTURE AND SPORTS,Respondent. | GANCAYCO, J

FACTS:
On February 21, 1987, the Task Force on Private Higher Education created by
the Department of Education, Culture and Sports (hereinafter referred to as the
DECS) submitted a report entitled "Report and Recommendations on a Policy
for Tuition and Other School Fees."

The DECS took note of the report of the Task Force and on the basis of the
same, the DECS, through the respondent Secretary of Education, Culture and
Sports (hereinafter referred to as the respondent Secretary), issued an Order
authorizing the 15% to 20% increase in school fees as recommended by the
Task Force. The petitioner averred that the increases were too high. Thereafter,
the DECS issued Department Order No. 37 modifying its previous Order and
reducing the increases to a lower ceiling of 10% to 15%, accordingly. Despite
this, the petitioner still opposed the increases. The petitioner, through a
counsel, sent a telegram to the President of the Philippines urging the
suspension of the implementation of Department Order No. 37. There was no
response from the Office of the President.

The petitioner filed the instant Petition for prohibition with the Supreme Court.
Petitioner alleged that the said Department Order was issued without any legal
basis. The petitioner also maintains that the questioned Department Order and
was issued in violation of the due process clause because petitioner was not
given due notice and hearing before the said Department Order was issued.

In support of the first argument, the petitioner argues that while the DECS is
authorized by law to regulate school fees in educational institutions, the power
to regulate does not always include the power to increase school fees. In the
second argument, the petitioner maintains that students and parents are
interested parties that should be afforded an opportunity for a hearing before
school fees are increased.

The respondent Secretary submitted a Comment on the Petition saying that the
increase in tuition and other school fees is urgent and necessary, and that the
assailed Department Order is not arbitrary in character.

ISSUE:

1. WON DECS’ power to regulate school fees "does not always include the
power to increase"
2. WON there is a violation of due process clause

RULING:

1. No. No other government agency has been vested with the authority to fix
school fees and as such, the power should be considered lodged with the
DECS if it is to properly and effectively discharge its functions and duties
under the law.
2. No. The function of prescribing rates by an administrative agency may be
either a legislative or an adjudicative function. If it were a legislative
function, the grant of prior notice and hearing to the affected parties is
not a requirement of due process. As regards rates prescribed by an
administrative agency in the exercise of its quasi-judicial function, prior
notice and hearing are essential to the validity of such rates. When the
rules and/or rates laid down by an administrative agency are meant to
apply to all enterprises of a given kind throughout the country, they may
partake of a legislative character. Where the rules and the rates imposed
apply exclusively to a particular party, based upon a finding of fact, then
 its function is quasi-judicial in character. The Court ruled that
Department Order No. 37 issued by the DECS in the exercise of its
legislative function.

The burden of proof is on the party assailing the regularity of official

proceedings. In the case at bar, the petitioner has not successfully
disputed the presumption. Petition is dismissed.

LUPO L. LUPANGCO, RAYMOND S. MANGKAL, NORMAN A. MESINA,

ALEXANDER R. REGUYAL, JOCELYN P. CATAPANG, ENRICO V.
REGALADO,
JEROME O. ARCEGA, ERNESTOC. BLAS, JR., ELPEDIO M. ALMAZAN,
KARL
CAESAR R. RIMANDO, petitioner,
vs
COURT OF APPEALS and PROFESSIONAL REGULATION
COMMISSION, respondent.
G.R. No. 77372 April 29, 1988 (160 SCRA 848)
Facts:
On Oct 6, 1986, the Professional Regulation Commission (PRC) issued
Resolution No.
105 "Additional Instructions to Examines," to all who will take the licensure
examinations in accountancy.
“No examinee shall attend any review class, briefing, conference or the like
conducted by, or shall receive any hand-out, review material, or any tip from
any school, college or university, or any review center or the like or any
reviewer, lecturer, instructor official or employee of any of the
aforementioned or similar institutions during the three days immediately
proceeding every examination day including examination day.”
Any examinee violating this instruction shall be subject to the sanctions
prescribed
by Sec. 8, Art. III of the Rules and Regulations of the Commission.
Oct 16, 1986, petitioners et al, filed a complaint for injunction with a prayer
with the issuance of a writ of
a preliminary injunction against respondent PRC to restrain the latter from
enforcing the above-mentioned
resolution and to declare the same unconstitutional, in the RTC.
Respondent PRC filed a motion to dismiss on October 21, 1987 on the ground
that the lower court had no
jurisdiction to review and to enjoin the enforcement of its resolution.
In an Order of October 21, 1987, the lower court declared that it had
jurisdiction to try the case and
enjoined the respondent commission from enforcing and giving effect to
Resolution No. 105 which it
found to be unconstitutional.
Not satisfied therewith, respondent PRC, on November 10, 1986, filed with the
Court of Appeals a
petition for the nullification of the above Order of the lower court. Said petition
was granted in the
Decision of the Court of Appeals promulgated on January 13, 1987. The Court
of Appeals, in deciding
that the Regional Trial Court of Manila had no jurisdiction to entertain the case
and to enjoin the
enforcement of the Resolution No. 105, stated as its basis its conclusion that
the Professional Regulation
Commission and the Regional Trial Court are co-equal bodies.
Hence, this petition for certiorari to review the decision of the Court of Appeals.
Issue:
1. Whether or not the Regional Trial Court has no jurisdiction over the case so
that it cannot pass upon the validity of the administrative acts of the
Professional Regulation Commission (being a co-equal body) and the issue is
within the scope of exclusive appellate jurisdiction of the Court of Appeals only
2. Whether or not the assailed Resolution is unconstitutional that it is
unreasonable and arbitrary and it violates the examinee’s right to liberty and
the academic freedom of schools

HELD:
1. No. There is no provision in Presidential Decree No. 223, creating the
Professional Regulation
Commission, that orders or resolutions of the Commission are appealable
either to the Court of
Appeals or to the Supreme Court. Consequently, this case, which was filed in
order to enjoin the
enforcement of a resolution of the respondent Professional Regulation
Commission, should fall
within the general jurisdiction of the Court of First Instance, now the Regional
Trial Court.
In order to invoke the exclusive appellate jurisdiction of the Court of Appeals as
provided for in
Section 9, paragraph 3 of B.P. Blg. 129, there has to be a final order or ruling
which resulted from
proceedings wherein the administrative body involved exercised its quasi-
judicial functions. In
Black's Law Dictionary, quasi-judicial is defined as a term applied to the
action, discretion, etc.,
of public administrative officers or bodies required to investigate facts, or
ascertain the existence
of facts, hold hearings, and draw conclusions from them, as a basis for their
official action, and to
exercise discretion of a judicial nature. To expound thereon, quasi-judicial
adjudication would
mean a determination of rights, privileges and duties resulting in a decision or
order which
applies to a specific situation. This does not cover rules and regulations of
general applicability
issued by the administrative body to implement its purely administrative
policies and functions
like Resolution No. 105 which was adopted by the respondent PRC as a
measure to preserve the
integrity of licensure examinations. The respondent Court is not only right but
duty bound to take
cognizance of cases of this nature wherein a constitutional and statutory right
is allegedly
infringed by the administrative action of a government office. Courts of first
Instance have
original jurisdiction over all civil actions in which the subject of the litigation is
not capable of
pecuniary estimation.
2. Yes. Resolution No. 105 is not only unreasonable and arbitrary, it also
infringes on the
examinees' right to liberty guaranteed by the Constitution. PRC has no
authority to dictate on the
reviewees as to how they should prepare themselves for the licensure
examinations. They cannot
be restrained from taking all the lawful steps needed to assure the fulfillment of
their ambition.
They have every right to make use of their faculties in attaining success in their
endeavors. The
assailed resolution also infringes on the academic freedom of schools. PRC
cannot interfere with the conduct of review that review schools and centers
believe would be best enable their enrollees to meet the standards required
before becoming a full-fledged public accountant. Unless the
means and methods of instruction are clearly found to be inefficient,
impractical or riddled with
corruption, review schools and centers may not be stopped from helping out
their students.

[G.R. No. 125350. December 3, 2002.]

HON. RTC JUDGES MERCEDES G. DADOLE (Executive Judge,
Branch 28), ULRIC R. CAÑETE (Presiding Judge, Branch 25),
AGUSTINE R. VESTIL (Presiding Judge, Branch 56), HON.
MTC JUDGES TEMISTOCLES M. BOHOLST (Presiding Judge,
Branch 1), VICENTE C. FANILAG (Judge Designate, Branch 2),
 and WILFREDO A. DAGATAN (Presiding Judge, Branch 3), all
of Mandaue City, petitioners,
vs.
COMMISSION ON AUDIT, respondent.

FACTS:

Petitioners RTC Judges Dadole et al and MTC judges Temistocles et al

stationed in Mandaue City received a monthly allowance of P1,260 each
pursuant to the yearly appropriation ordinance. Eventually, in 1991, it was
increased to P1,500 for each judge. However, the Department of Budget and
Management (DBM) then issued Local Budget Circular No. 55 which provides
that the additional monthly allowances to be given by a local government unit
should not exceed P1,000 in provinces and cities and P700 in municipalities.
Acting on the said DBM directive, the Mandaue City Auditor issued notices of
disallowance to herein petitioners in excess of the amount authorized by LBC
55. Thus, petitioners filed with the Office of the City Auditor a protest.
However, it was treated as a motion for reconsideration and was endorsed to
the Commission on Audit Regional Office. In turn, the COA Regional Office
referred the said motion to their Head Office with recommendation that the
same should be denied. Accordingly, it was denied by the COA. Hence,
petitioners filed the instant petition. They argued, among others, that LBC 55
is void for infringing on the local autonomy of Mandaue City by dictating a
uniform amount that a local government unit can disburse as additional
allowances to judges stationed therein.

ISSUE: Whether or not LBC 55 is void for infringing the local autonomy of
Mandaue City

HELD: Yes. We recognize that, although our Constitution guarantees autonomy

to local government units, the exercise of local autonomy remains subject to
the power of control by Congress and the power of supervision by the
President. Section 4 of Article X of the 1987 Philippine Constitution provides
that: "Sec. 4. The President of the Philippines shall exercise general supervision
over local governments. . . . " Under Section 458, of RA 7160, the law that
supposedly serves as the legal basis of LBC 55, allows the grant of additional
allowances to judges "when the finances of the city government allow." The said
provision does not authorize setting a definite maximum limit to the additional
allowances granted to judges. Thus, this Court need not belabor the point that
the finances of a city government may allow the grant of additional allowances
higher than P1,000 if the revenues of the said city government exceed its
annual expenditures. Setting a uniform amount for the grant of additional
allowances is an inappropriate way of enforcing the criterion found in Section
458, par. (a)(l)(xi), of RA 7160. The DBM over-stepped its power of supervision
over local government units by imposing a prohibition that did not correspond
with the law it sought to implement. In other words, the prohibitory nature of
the circular had no legal basis. The President can only interfere in the affairs
and activities of a local government unit if he or she finds that the latter has
acted contrary to law. This is the scope of the President's supervisory powers
over local government units. Hence, the President or any of his or her alter
egos cannot interfere in local affairs as long as the concerned local government
unit acts within the parameters of the law and the Constitution. Any directive
therefore by the President or any of his or her alter egos seeking to alter the
wisdom of a law-conforming judgment on local affairs of a local government
unit is a patent nullity because it violates the principle of local autonomy and
separation of powers of the executive and legislative departments in governing
municipal corporations.

AVELINA B. CONTE and LETICIA BOISER-PALMA, petitioners,

vs. COMMISSION ON AUDIT (COA), respondent.

(264 SCRA 19, L - 116422 04 NOVEMBER 1996)

FACTS:

Avelina Conte and Leticia Boiser were both former employees of SSS who
availed of compulsory retirement benefits provided for under RA No. 660. Both
also claimed with the SSS “financial assistance” benefits as provided for under
SSS Resolution No. 56, Series of 1971.

The subject SSS resolution was disallowed by COA in its ruling issued on July
10, 1989 stating that the scheme of financial assistance authorized by SSS is
similar to separate retirement plan or incentives/separation pay plans adopted
by other government agencies which in turn results in the increase of benefits
beyond what is allowed under existing retirement laws.

The SSS thereafter sought presidential authority to continue implementing

Res. 56 to which the Office of the Executive Secretary replied that the Office of
the President is not inclined to favorably act on the request or let alone
overrule COA’s earlier ruling.

Petitioners Conte and Boiser sought reconsideration of COA’s ruling

disallowing their claim and also sought payment from SSS of benefits as
prescribed under Res. 56, both of which were denied by COA and SSS.

ISSUE:

Whether or not the benefits provided for under SSS Resolution No. 56 be
considered simply as financial assistance for retiring employees, or does such a
scheme constitute a supplementary retirement plan prescribed by RA 4968.

HELD:

The Supreme Court ruled that SSS Resolution No. 56 constitute a

supplementary retirement plan, thus, within the ambit of Sec. 28 (b) of CA 186
as amended by RA 4968 which bars the creation of any insurance or retirement
plan – other than the GSIS – for government officers and employees, in order to
prevent the undue and iniquitous proliferation of such plans. Resolution No.
56 is therefore invalid, void and of no effect.

Petition was dismissed for lack of merit, the assailed COA decision is upheld,
and SSS Resolution No. 56 is declared illegal, void and of no effect.

ROMULO, MABANTA, BUENAVENTURA, SAYOC & DE LOS ANGELES vs.

HOME DEVELOPMENT MUTUAL FUND
Posted on June 20, 2013 by winnieclaire
tandard

G.R. No. 131082 June 19, 2000

Facts: petitioner Romulo, Mabanta, Buenaventura, Sayoc and De Los Angeles

(hereafter PETITIONER), a law firm, was exempted for the period 1 January to
31 December 1995, from the Pag-IBIG Fund coverage by respondent HDMF
because of a superior retirement plan.
The HDMF Board of Trustees, pursuant to Section 5 of Republic Act No. 7742,
issued Board Resolution No. 1011, Series of 1995, amending and modifying the
Rules and Regulations Implementing R.A. No. 7742. As amended, Section 1 of
Rule VII provides that for a company to be entitled to a waiver or suspension of
Fund coverage, 3 it must have a plan providing for both provident/retirement
and housing benefits superior to those provided under the Pag-IBIG Fund.

PETITIONER submitted to the HDMF a letter explaining that the Amendments

to the Rules are invalid. In that the amendments are void insofar as they
abolished the exemption granted by Section 19 of P.D. 1752, as amended. The
repeal of such exemption involves the exercise of legislative power, which
cannot be delegated to HMDF.
HDMF disapproved PETITIONER’s application on the ground that the
requirement that there should be both a provident retirement fund and a
housing plan is clear in the use of the phrase “and/or,” and that the Rules
Implementing R.A. No. 7742 did not amend nor repeal Section 19 of P.D. No.
1752 but merely implement the law. The respondent Board was merely
exercising its rule-making power under Section 13 of P.D. No. 1752. It had the
option to use “and” only instead of “or” in the rules on waiver in order to
effectively implement the Pag-IBIG Fund Law. By choosing “and,” the Board
has clarified the confusion brought about by the use of “and/or” in Section 19
of P.D. No. 1752, as amended.
PETITIONER filed a petition for review before the Court of Appeals but was
dismissed.

Issue: Whether or not the board of HDMF exceeded its delegated power.

Held: YES. The controversy lies in the legal signification of the words “and/or.”

It seems to us clear from the language of the enabling law that Section 19 of
P.D. No. 1752 intended that an employer with a provident plan or an employee
housing plan superior to that of the fund may obtain exemption from coverage.
If the law had intended that the employee [sic] should have both a superior
provident plan and a housing plan in order to qualify for exemption, it would
have used the words “and” instead of “and/or.”
Notably, paragraph (a) of Section 19 requires for annual certification of waiver
or suspension, that the features of the plan or plans are superior to the fund or
continue to be so. The law obviously contemplates that the existence of either
plan is considered as sufficient basis for the grant of an exemption; needless to
state, the concurrence of both plans is more than sufficient. To require the
existence of both plans would radically impose a more stringent condition for
waiver which was not clearly envisioned by the basic law. By removing the
disjunctive word “or” in the implementing rules the respondent Board has
exceeded its authority.
It is without doubt that the HDMF Board has rule-making power as provided in
Section 51 17 of R.A. No. 7742 and Section 13 18 of P.D. No. 1752. However, it
is well-settled that rules and regulations, which are the product of a delegated
power to create new and additional legal provisions that have the effect of law,
should be within the scope of the statutory authority granted by the legislature
to the administrative agency. 19 It is required that the regulation be germane
to the objects and purposes of the law, and be not in contradiction to, but in
conformity with, the standards prescribed by law.

In the present case, when the Board of Trustees of the HDMF required in
Section 1, Rule VII of the 1995 Amendments to the Rules and Regulations
Implementing R.A. No. 7742 that employers should have both
provident/retirement and housing benefits for all its employees in order to
qualify for exemption from the Fund, it effectively amended Section 19 of P.D.
No. 1752. And when the Board subsequently abolished that exemption through
the 1996 Amendments, it repealed Section 19 of P.D. No. 1752. Such
amendment and subsequent repeal of Section 19 are both invalid, as they are
not within the delegated power of the Board. The HDMF cannot, in the exercise
of its rule-making power, issue a regulation not consistent with the law it seeks
to apply. Indeed, administrative issuances must not override, supplant or
modify the law, but must remain consistent with the law they intend to carry
out. Only Congress can repeal or amend the law.

CIR vs. Fortune Tobacco

September 28, 2011 G.R. No. 180006

Facts: Prior to January 1, 1997, the excises taxes on cigarettes were in the
form of ad valorem taxes, pursuant to Section 142 of the 1977 National
Internal Revenue Code (1977 Tax Code). Beginning January 1, 1997, RA 8240
took effect and a shift from ad valorem to specific taxes was made. A portion of
Section 142(c) of the 1977 Tax Code, as amended by RA 8240, reads in part:

“The specific tax from any brand of cigarettes within the next three (3) years of
effectivity of this Act shall not be lower than the tax [which] is due from each
brand on October 1, 1996.

xxx

The rates of specific tax on cigars and cigarettes under paragraphs (1), (2), (3)
and (4) hereof, shall be increased by twelve percent (12%) on January 1, 2000.”

To implement the 12% increase in specific taxes mandated under Section 145
of the 1997 Tax Code and again pursuant to its rule-making powers, the CIR
issued RR 17-99, which reads partly:

“Provided, however, that the new specific tax rate for any existing brand of
cigars [and] cigarettes packed by machine, distilled spirits, wines and
fermented liquors shall not be lower than the excise tax that is actually being
paid prior to January 1, 2000.”

Pursuant to these laws, respondent Fortune Tobacco Corporation paid in

advance excise taxes and filed an administrative claim for tax refund with the
CIR for erroneously and/or illegally collected taxes in the amount of P491
million.

In its decision, the CTA First Division ruled in favor of Fortune Tobacco and
granted its claim for refund. The CTA First Divisions ruling was upheld on
appeal by the CTA en banc. The CIR’s motion for reconsideration of the CTA en
banc’s decision was denied in a resolution.

Issue: Whether or not Section 1 of RR 17-99 is an unauthorized administrative

legislation on the part of the CIR.

Ruling: Yes. The proviso in Section 1 of RR 17-99 clearly went beyond the
terms of the law it was supposed to implement, and therefore entitles Fortune
Tobacco to claim a refund of the overpaid excise taxes collected pursuant to
this provision.

The rule on uniformity of taxation is violated by the proviso in Section 1, RR

17-99. Uniformity in taxation requires that all subjects or objects of taxation,
similarly situated, are to be treated alike both in privileges and liabilities.
Although the brands all belong to the same category, the proviso in Section 1,
RR 17-99 authorized the imposition of different (and grossly disproportionate)
tax rates. It effectively extended the qualification stated in the third paragraph
of Section 145(c) of the 1997 Tax Code that was supposed to apply only during
the transition period. In the process, the CIR also perpetuated the unequal tax
treatment of similar goods that was supposed to be cured by the shift from ad
valorem to specific taxes.

The Court further said that the omission in the law in fact reveals the
legislative intent not to adopt the higher tax rule. It appears that despite its
awareness of the need to protect the increase of excise taxes to increase
government revenue, Congress ultimately decided against adopting the higher
tax rule.


BENGZON VS. DRILON G.R. 103524 April 15, 1992 208 SCRA 133
BENGZON VS. DRILON
G.R. 103524 April 15, 1992 208 SCRA 133
Gutierrez, J.:

FACTS:
Petitioners are retired justices of the Supreme Court and Court of Appeals who
are currently receiving pensions under RA 910 as amended by RA 1797.
President Marcos issued a decree repealing section 3-A of RA 1797 which
authorized the adjustment of the pension of retired justices and officers and
enlisted members of the AFP. PD 1638 was eventually issued by Marcos which
provided for the automatic readjustment of the pension of officers and enlisted
men was restored, while that of the retired justices was not. RA 1797 was
restored through HB 16297 in 1990. When her advisers gave the wrong
information that the questioned provisions in 1992 GAA were an attempt to
overcome her earlier veto in 1990, President Aquino issued the veto now
challenged in this petition.
It turns out that PD 644 which repealed RA 1797 never became a valid law
absent its publication, thus there was no law. It follows that RA 1797 was still
in effect and HB 16297 was superfluous because it tried to restore benefits
which were never taken away validly. The veto of HB 16297 did not also
produce any effect.
ISSUE:
Whether or not the veto of the President of certain provisions in the GAA of FY
1992 relating to the payment of the adjusted pensions of retired Justices is
constitutional or valid.
HELD:
The veto of these specific provisions in the GAA is tantamount to dictating to
the Judiciary ot its funds should be utilized, which is clearly repugnant to
fiscal autonomy. Pursuant to constitutional mandate, the Judiciary must enjoy
freedom in the disposition of the funds allocated to it in the appropriations law.
Any argument which seeks to remove special privileges given by law to former
Justices on the ground that there should be no grant of distinct privileges or
“preferential treatment” to retired Justices ignores these provisions of the
Constitution and in effect asks that these Constitutional provisions on special
protections for the Judiciary be repealed.
The petition is granted and the questioned veto is illegal and the provisions of
1992 GAA are declared valid and subsisting.

COMMISSION ON HUMAN RIGHTS EMPLOYEES’ ASSOCIATION

(CHREA) vs.COMMISSION ON HUMAN RIGHTS
G.R. No. 155336. November 25, 2004.

FACTS:
On 14 February 1998, Congress passed Republic Act No. 8522, otherwise
known as the General Appropriations Act of 1998. It provided for Special
Provisions Applicable to All Constitutional Offices Enjoying Fiscal Autonomy.
On the strength of these special provisions, the CHR promulgated Resolution
No. A98-047 adopting an upgrading and reclassification scheme among
selected positions in the Commission. To support the implementation of such
scheme, the CHR, in the same resolution, authorized the augmentation of a
commensurate amount generated from savings under Personnel Services. By
virtue of Resolution No. A98-062 the CHR “collapsed” the vacant positions in
the body to provide additional source of funding for said staffing modification.
Among the positions collapsed were: one Attorney III, four Attorney IV, one
Chemist III, three Special Investigator I, one Clerk III, and one Accounting
Clerk II. The CHR forwarded said staffing modification and upgrading scheme
to the DBM with a request for its approval, but the then DBM secretary
Benjamin Diokno denied the request. In light of the DBM’s disapproval of the
proposed personnel modification scheme, the CSC-National Capital Region
Office, through a memorandum recommended to the CSC-Central Office that
the subject appointments be rejected owing to the DBM’s disapproval of the
plantilla reclassification. Meanwhile, the officers of petitioner CHREA, in
representation of the rank and file employees of the CHR, requested the CSC-
Central Office to affirm the recommendation of the CSC-Regional Office.
CHREA stood its ground in saying that the DBM is the only agency with
appropriate authority mandated by law to evaluate and approve matters of
reclassification and upgrading, as well as creation of positions. The CSC-
Central Office denied CHREA’s request in a Resolution and reversed the
recommendation of the CSC-Regional Office that the upgrading scheme be
censured.

ISSUE:
Whether or not the Commission on Human Rights validly implement an
upgrading, reclassification, creation, and collapsing of plantilla positions in the
Commission without the prior approval of the Department of Budget and
Management?

HELD:
CHREA grouses that the Court of Appeals and the CSC-Central Office both
erred in sanctioning the CHR’s alleged blanket authority to upgrade, reclassify,
and create positions inasmuch as the approval of the DBM relative to such
scheme is still indispensable. Petitioner bewails that the CSC and the Court of
Appeals erroneously assumed that CHR enjoys fiscal autonomy insofar as
financial matters are concerned, particularly with regard to the upgrading and
reclassification of positions therein. The CHR, although admittedly a
constitutional creation is, nonetheless, not included in the genus of offices
accorded fiscal autonomy by constitutional or legislative fiat.as the law’s
designated body to implement and administer a unified compensation system,
is beyond cavil. The interpretation of an administrative government agency,
which is tasked to implement a statute is accorded great respect and ordinarily
controls the construction of the courts. In Energy Regulatory Board v. Court of
Appeals,we echoed 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.

CSC vs DBM Case Digest

CIVIL SERVICE COMMISSION v. DEPARTMENT OF BUDGET AND

MANAGEMENT

482 SCRA 233 (2005), EN BANC (Carpio Morales, J.)

“Automatic release” of approved annual appropriations to Civil Service

Commission, a constitutional commission which is vested with fiscal
autonomy, should thus be construed to mean that no condition to fund
releases to it may be imposed.

FACTS: The total funds appropriated by General Appropriations Act of 2002

(GAA) for Civil Service Commission (CSC) was P285,660,790.44. CSC
complains that the total funds released by Department of Budget and
Management (DBM) was only P279,853,398.14, thereby leaving an unreleased
balance of P5,807,392.30.

CSC contends that the funds were intentionally withheld by DBM on the
ground of their ―no report, no release‖ policy. Hence, CSC filed a petition for
mandamus seeking 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.

ISSUE: Whether or not DBM‘s policy, ―no report, no release‖ is constitutional

HELD: DBM‘s act of withholding the subject funds from CSC due to revenue
shortfall is hereby declared unconstitutional.

The no report, no release policy may not be validly enforced against offices
vested with fiscal autonomy is not disputed. Indeed, such policy cannot be
enforced against offices possessing fiscal autonomy without violating Article IX
(A), Section 5 of the Constitution, which provides that the Commission shall
enjoy fiscal autonomy and that their approved appropriations shall be
automatically and regularly released.

The Court held in the case of, Batangas v. Romulo, ―automatic release‖ in
Section 6, Article X of the Constitution is defined as ―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 thus be construed to mean that no condition to fund
releases to it may be imposed. This conclusion 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.

Furthermore, the Constitution grants the enjoyment of fiscal autonomy only to

the Judiciary, the Constitutional Commissions, of which petitioner is one, and
the Ombudsman. To hold that the CSC may be subjected to withholding or
reduction of funds in the event of a revenue shortfall would, to that extent,
place CSC 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.

Case Digest: Phil. International Trading Corp. v. COA

G.R. No. 183517 : June 22, 2010

PHILIPPINE INTERNATIONAL TRADING CORPORATION, Petitioner, v.

COMMISSION ON AUDIT, Respondent.

PEREZ, J.:

FACTS:

With the issuance of PD 1071, otherwise known as the Revised Charter of the
Philippine International Trading Corporation, then President Marcos issued EO
756, authorizing the reorganization of PITC. On February 18, 1983, President
Marcos issued Executive Order No. 87. Romero, an officer of petitioner, filed a
July 16, 2001 request, seeking from petitioner payment of retirement
differentials on the strength of Section 6 of Executive Order No. 756. COA
Comm. Habitan issued the assailed ruling,stating that Reserve for Retirement
Gratuity and Commutation of Leave Credits of petitioners employees did not
include allowances outside of the basic salary, said officer ruled that Executive
Order No. 756 was a special law issued only for the specific purpose of
reorganizing petitioner corporation. Finding that Section 6 of Executive Order
No. 756 was simply an incentive to encourage employees to resign or retire at
the height of petitioners reorganization, said decision went on to make the
following pronouncements, to wit:"Moreover, RA No. 4968 prohibits the
creation of any insurance retirement plan by any government agency and
government-owned or controlled corporation other than the GSIS.

ISSUE: Whether Executive Order No. 756 is an additional alternative to existing

general retirement laws and/or an exception to the prohibition against separate
or supplementary insurance retirement or pension plans.

HELD: No.

POLITICAL LAW: interpretation of statute; Executive Order No. 756 as an

additional alternative to existing general retirement law.

Time and again, it has been held that every statute must be so interpreted and
brought in accord with other laws as to form a uniform system of
jurisprudence. In the absence of a manifest and specific intent from which the
same may be gleaned, Section 6 of Executive Order No. 756 cannot be
construed as an additional alternative to existing general retirement laws
and/or an exception to the prohibition against separate or supplementary
insurance retirement or pension plans as aforesaid. Aside from the fact that a
meaning that does not appear nor is intended or reflected in the very language
of the statute cannot be placed therein by construction, petitioner would
likewise do well to remember that repeal of laws should be made clear and
express. Repeals by implication are not favored as laws are presumed to be
passed with deliberation and full knowledge of all laws existing on the subject,
the congruent application of which the courts must generally presume. For this
reason, it has been held that the failure to add a specific repealing clause
particularly mentioning the statute to be repealed indicates that the intent was
not to repeal any existing law on the matter, unless an irreconcilable
inconsistency and repugnancy exists in the terms of the new and old laws.

As an adjunct to the reorganization mandated under Executive Order No. 756,

SC find that the foregoing provision cannot be interpreted independent of the
purpose or intent of the law. Rather than the permanent retirement law for its
employees that petitioner now characterizes it to be, SC stated that the
provision of gratuities equivalent to one month pay for every year of service
computed at highest salary received including all allowances was clearly meant
as an incentive for employees who retire, resign or are separated from service
during or as a consequence of the reorganization petitioners Board of Directors
was tasked to implement. Again, as a temporary measure, it cannot be
interpreted as an exception to the general prohibition against separate or
supplementary insurance and/or retirement or pension plans under Section
28, Subsection (b) of Commonwealth Act No. 186, amended.

Petition is DENIED.

G.R. No. 109023 | August 12, 1998 | RODOLFO S. DE JESUS, EDELWINA

DE PARUNGAO, VENUS M. POZON AND other similarly situated personnel
of the LOCAL WATER UTILITIES ADMINISTRATION (LWUA), petitioners, vs.
COMMISSION ON AUDIT AND LEONARDO L. JAMORALIN in his capacity
as COA-LWUA Corporate Auditor,respondents. | PURISIMA, J.:

FACTS:
Petitioners are employees of the Local Water Utilities Administration (LWUA).
On July 1, 1989, Republic Act No. 6758 "An Act Prescribing A Revised
Compensation and Position Classification System in the Government and For
Other Purposes", took effect. Section 12 of said law provides for the
consolidation of allowances and additional compensation into standardized
salary rates. Certain additional compensations, however, were exempted from
consolidation. Prior to this, they were receiving honoraria as designated
members of the LWUA Board Secretariat and the Pre-Qualification, Bids and
Awards Committee. To implement RA 6758, the Department of Budget and
Management (DBM) issued Corporate Compensation Circular No. 10 (DBM-
CCC No. 10), discontinuing without qualification effective November 1, 1989,
all allowances and fringe benefits granted on top of basic salary.

Pursuant to said Circular, respondent Leonardo Jamoralin, as corporate

auditor, disallowed on post audit, the payment of honoraria to the herein
petitioners. Petitioners appealed to the COA, questioning the validity and
enforceability of DBM-CCC No. 10. They contend that the Circular is
inconsistent with the provisions of Rep. Act 6758 (the law it is supposed to
implement) and, therefore, void. And it is without force and effect because it
was not published in the Official Gazette.

COA upheld the validity and effectivity of DBM-CCC No. 10. Petitioners
elevated the case to the Supreme Court.
The Solicitor General supported the petitioners, saying that Sec. 5.6 of DBM-
CCC No. 10 is a nullity for being inconsistent with and repugnant to the very
law it is intended to implement. The DBM Secretary asserted that the
honoraria in question are considered included in the basic salary, for the
reason that they are not listed as exceptions under Sec. 12 of Rep. Act 6758.

ISSUE:

Whether or not DBM-CCC No. 10 has legal force or effect despite its lack of
publication in the Official Gazette

RULING:

No. Following the doctrine enunciated in Tanada v. Tuvera (146 SCRA

446), publication in the Official Gazette or in a newspaper of general circulation
in the Philippines is required since DBM-CCC No. 10 is in the nature of an
administrative circular the purpose of which is to enforce or implement an
existing law. Stated differently, to be effective and enforceable, DBM-CCC No.
10 must go through the requisite publication in the Official Gazette or in a
newspaper of general circulation in the Philippines.

It is clear that DBM-CCC No. 10 is not a mere interpretative or internal

regulation. Before the said circular under attack may be permitted to
substantially reduce their income, the government officials and employees
concerned should be apprised and alerted by the publication of subject circular
in the Official Gazette or in a newspaper of general circulation in the
Philippines — to the end that they be given amplest opportunity to voice out
whatever opposition they may have, and to ventilate their stance on the matter.
This approach is more in keeping with democratic precepts and rudiments of
fairness and transparency. The ineffectiveness of the Circular makes resolution
of the other issues at bar unnecessary.

Petition is granted.
What is AGENCY?
A relation, created either by express or implied contract or by law, whereby one party
(called the principal or constituent) delegates the transaction of some lawful business or
the authority to do certain acts for him or in relation to his rights or property, with more
or less discretionary power, to another person (called the agent, attorney, proxy, or
delegate) who undertakes to manage the affair and render him an account thereof. State
v. Ilubbard, 58 Kan. 797, 51 Pac. 290, 39 L. R. A. S60; Sternaman v. Insurance Co., 170
N. Y. 13, 62 N. E. 763, 57 L. R. A. 318, 88 Am. St. Rep. 625; Wynegar v. State, 157 Ind.
577, 62 N. E. 38. The contract of agency may be defined to be a contract by which one of
the contracting parties confides the management of some affair, to be transacted on his
account, to the other party, who undertakes to do the business and render an account of
it. 1 Liverm. Prin. & Ag. 2. A contract by which one person, with greater or less
discretionary power, undertakes to represent another in certain business relations.
Whart. Ag. 1. A relation between two or more persons, by which one party, usually called
the agent or attorney, is authorized to do certain acts for, or in relation to (lie rights or
property of the other, who is denominated the principal, constituent, or employer.
Bouvier.