PHILIPPINE INTERNATIONAL TRADING CORPORATION, petitioner, vs.

ANGELES, respondent
G.R. No. 108461. October 21, 1996

Facts:

The Philippine International Trading Corporation, a government owned and controlled corporation
issued Administrative Order No. SOCPEC 89-08-01 under which application to the PITC for importation
from the People’s Republic of China (PROC) must be accompanied by a viable and confirmed Export
Program of the Philippine Products to China carried out by the importer himself or through a tie-up with
a legitimate importer from PROC in an amount equivalent to the value of importation from PRC being
applied for, or simply at one-to one ratio.

Two domestic corporations, Remington and Firestone, both applied for authority to import from PROC,
which were granted, but later on were withheld for failure to comply with the require one to one ratio
of import and export.

They filed a complaint asserting that the administrative order is unconstitutional. The RTC ruled that the
order was a restraint of trade in violation of Section 1 and 19 of Article XII of the 1987 Constitution. PITC
elevated the case to the Supreme Court.

Issue:

Whether or not Administrative Order No. SOCPEC 89-08-01 is valid.

Ruling:

The order was not valid.

The PITC is a line agency of the Department of Trade and Industry which was the primary coordinative,
promotive, facilitative and regulatory arm of the government for the country’s trade. The PITC as an
integral part of the DTI was given the task of the implementing the departments’ program. It has the
authority to issue the questioned order and may legally exercise that authority under the supervision of
the DTI. The grant t quasi-legislative powers in administrative bodies are not unconstitutional. It has
become necessary to create more administrative bodies to help in the regulation of its activities.
Because hey specializes in the field assigned to them, they can deal and dispatch problems with more
expertise than the legislature or the courts of justice.

In sum, the PITC was legally empowered to issue the Administrative Orders as a valid exercise of a
power ancillary to legislation; however, it does not imply that the order was valid. First, it was
never published, thus it is not effective. Second, the same is inconsistent with the declared policy of the
government to then effect that it will develop and strengthen trade relations with the PROC. Since the
order was a unnecessary barrier to trade, the same is not a valid exercise of its authority.
ABS-CBN Broadcasting Corporation v Philippine
Multi-Media System, Inc. G.R. Nos. 175769-70, January
19, 2009
ABS-CBN Broadcasting Corporation v Philippine Multi-Media System, Inc.
G.R. Nos. 175769-70, January 19, 2009

Facts:
Philippine Multi-Media System, Inc. (PMSI), operator of Dream Broadcsating System, delivers a digital
direct-to-home (DTH) television satellite to its subscribers all over the Philippines, was granted a
legislative franchise under Republic Act 8630 and was given a Provisional Authority by the National
Telecommunications Commission (NTC) to install, operate and maintain a nationwide DTH satellite
service. When it commenced operations, it offered as part of its program line-up, together with other paid
premium program channels, ABS-CBN Channels 2 and 23, NBN, Channel 4, ABC, Channel 5, GMA,
Channel 7, RPN, Channel 9, and IBC, Channel 13, pursuant to Memorandum Circular 4-08-88 which
mandated all cable television system operators, operating within the Grade “A” and “B” CONTOURS to
carry out the television signals of the authorized television broadcast stations.

ABS-CBN Broadcasting Corporation (ABS-CBN), a licensed television and radio broadcasting network,
demanded PMSI to cease and desist from “rebroadcasting” Channels 2 and 23. In its reply, PMSI
contended that the “rebroadcasting” was in accordance with the authority granted by NTC under its
obligations under NTC MC 4-08-88.

Negotiations were ensued between the parties in an effort to reach a settlement; however, the same was
terminated by ABS-CBN allegedly due to PMSI’s inability to ensure the prevention of illegal
“retransmission” and further “rebroadcast” of its signals, as well as the adverse effect of the rebroadcasts
on the business operations of its regional television stations.

ABS-CBN filed with the Intellectual Property Rights Office (IPO) a complaint for “Violation of Laws
Involving Property Rights, with Prayer for the Issuance of a Temporary Restraining Order and/or Writ of
Preliminary Injunction” alleging that PMSI’s unauthorized rebroadcasting of Channels 2 and 23 infringed
on its broadcasting rights and copyright. The TRO was granted by the Bureau of Legal Affairs (BLA) of
IPO. PMSI, pursuant to the TRO, suspended the retransmission of PMSI of Channels 2 and 23 and
likewise filed a petition for certiorari with the Court of Appeals. The Court of Appeals granted the petition
of PMSI and reversed the decision of the BLA. ABS-CBN filed its appeal however it was dismissed by the
Court of Appeals. Furthermore, ABS-CBN’s motion for reconsideration was denied.

Issue:
1. Whether or not PMSI violated the Laws on Property Rights.
2. Whether or not the issuance MC 4-08-88 by the NTC is a valid exercise of the police power of the
State.

Held:
1. NO. PMSI did not violate the Laws on Property Rights because it is not engaged in rebroadcasting
Channels 2 and 23. Rebroadcasting has been defined as “the simultaneous broadcasting by one
broadcasting organization of the broadcast of another broadcasting organization.” It is also “the
transmission by wireless means for the public reception of sounds or of images or of representations
thereof; such transmission by satellite is also ‘broadcasting’ where the means for decrypting are provided
to the public by the broadcasting organization or with its consent.” PMSI is only engaged in the carrying of
signals of ABS-CBN coming from ABS-CBN and transmitting signals. PMSI is not the origin nor does it
claim to be the origin of the programs broadcasted by the ABS-CBN. PMSI did not make and transmit on
its own but merely carried the existing signals of the ABS-CBN. When PMSI subscribers view ABS-CBN’s
programs in Channels 2 and 23, they know that the origin thereof was the ABS-CBN.
The nature of broadcasting is to scatter the signals in its widest area of coverage as possible. On this
score, it may be said that making public means that accessibility is undiscriminating as long as it is within
the range of the transmitter and equipment of the broadcaster. That the medium through which the PMSI
carries the ABS-CBN’s signal, that is via satellite, does not diminish the fact that it operates and functions
as a cable television. It remains that the PMSI’s transmission of signals via its DTH satellite television
service cannot be considered within the purview of broadcasting.

Furthermore, there is no rebroadcasting on the part of the PMSI of the ABS-CBM’s programs on
Channels 2 and 23, as defined under the Rome Convention, which defines rebroadcasting as “the
simultaneous broadcasting by one broadcasting organization of the broadcast of another broadcasting
organization.” ABS-CBN creates and transmits its own signals; PMSI merely carries such signals which
the viewers receive in its unaltered form. PMSI does not produce, select, or determine the programs to be
shown in Channels 2 and 23. Likewise, it does not pass itself off as the origin or author of such programs.
Insofar as Channels 2 and 23 are concerned, PMSI merely retransmits the same in accordance with
Memorandum Circular 04-08-88. With regard to its premium channels, it buys the channels from content
providers and transmits on an as-is basis to its viewers. Clearly, PMSI does not perform the functions of a
broadcasting organization; thus, it cannot be said that it is engaged in rebroadcasting Channels 2 and 23.

Therefore, the retransmission of ABS-CBN’s signals by PMSI – which functions essentially as a cable
television – does not constitute rebroadcasting in violation of the former’s intellectual property rights under
the IP Code.

2. YES. The law on copyright is not absolute. The carriage of ABS-CBN’s signals by virtue of the must-
carry rule in Memorandum Circular No. 04-08-88 is under the direction and control of the government
though the NTC which is vested with exclusive jurisdiction to supervise, regulate and control
telecommunications and broadcast services/facilities in the Philippines. The imposition of the must-carry
rule is within the NTC’s power to promulgate rules and regulations, as public safety and interest may
require, to encourage a larger and more effective use of communications, radio and television
broadcasting facilities, and to maintain effective competition among private entities in these activities
whenever the Commission finds it reasonably feasible.

The “Must-Carry Rule” is in consonance with the principles and objectives underlying Executive Order No.
436, to wit:

The Filipino people must be given wider access to more sources of news, information, education, sports
event and entertainment programs other than those provided for by mass media and afforded television
programs to attain a well informed, well-versed and culturally refined citizenry and enhance their socio-
economic growth.

Moreover, radio and television waves are mere franchised which may be reasonably burdened with some
form of public service. It is a privilege subject, among other things, to amendment by Congress in
accordance with the constitutional provision that “any such franchise or right granted . . . shall be subject
to amendment, alteration or repeal by the Congress when the common good so requires.”

The must carry rule is a valid exercise of the police power of the State. It favors both broadcasting
organizations and the public. It prevents cable television companies from excluding broadcasting
organization especially in those places not reached by signal. Also, the rule prevents cable television
companies from depriving viewers in far-flung areas the enjoyment of programs available to city viewers.
In fact, this Office finds the rule more burdensome on the part of the cable television companies. The
latter carries the television signals and shoulders the costs without any recourse of charging. On the other
hand, the signals that are carried by cable television companies are dispersed and scattered by the
television stations and anybody with a television set is free to pick them up.
 HE PROVINCE OF NORTH COTABATO, et al . v . THE GOVERNMENT OF
THE REPUBLIC OF THE PHILIPPINES, et al .

President Gloria Macapagal-Arroyo, in line with the government‘s policy of pursuing

peace negotiations with the Moro Islamic Liberation Front (MILF), asked Prime Minister
Mahathir Mohammad to convince the MILF to continue negotiating with the government.
MILF, thereafter, convened its Central Committee and decided to meet with the
Government of the Republic of the Philippines (GRP). Formal peace talks were held in
Libya which resulted to the crafting of the GRP-MILF Tripoli Agreement on Peace (Tripoli
Agreement 2001) which consists of three (3) aspects: a.) security aspect; b.) rehabilitation
aspect; and c.) ancestral domain aspect. Various negotiations were held which led to the
finalization of the Memorandum of Agreement on the Ancestral Domain (MOA-AD). The
said memorandum was set to be signed last August 5, 2008. In its body, it grants ―the
authority and jurisdiction over the Ancestral Domain and Ancestral Lands of the
Bangsamoro to the Bangsamoro Juridical Entity (BJE). The latter, in addition, has the
freedom to enter into any economic cooperation and trade relation with foreign countries.
―The sharing between the Central Government and the BJE of total production
pertaining to natural resources is to be 75:25 in favor of the BJE. The MOA-AD further
provides for the extent of the territory of the Bangsamoro. It describes it as ―the land
mass as well as the maritime, terrestrial, fluvial and alluvial domains, including the aerial
domain and the atmospheric space above it, embracing the Mindanao-Sulu-Palawan
geographic region. With regard to governance, on the other hand, a shared responsibility
and authority between the Central Government and BJE was provided. The relationship
was described as ―associative. With the formulation of the MOA-AD, petitioners aver that
the negotiation and finalization of the MOA-AD violates constitutional and statutory
provisions on public consultation, as mandated by Executive Order No. 3, and right to
information. They further contend that it violates the Constitution and laws. Hence, the
filing of the petition.

ISSUES:

1) Whether or not the MOA-AD violates constitutional and statutory provisions on public
consultation and right to information 2) Whether or not the MOA-AD violates the
Constitution and the laws.

HELD:

The MOA-AD subject of the present cases is of public concern, involving as it does the
sovereignty and territorial integrity of the State, which directly affects the lives of the
public at large. Intended as a ―splendid symmetry to the right to information under the
Bill of Rights is the policy of public disclosure under Section 28, Article II of the
Constitution which provides that subject to reasonable conditions prescribed by law, the
State adopts and implements a policy of full public disclosure of all its transactions
involving public interest. Moreover, the policy of full public disclosure enunciated in
above-quoted Section 28 complements the right of access to information on matters of
public concern found in the Bill of Rights. The right to information guarantees the right
of the people to demand information, while Section 28 recognizes the duty of officialdom
to give information even if nobody demands. The policy of public disclosure establishes a
concrete ethical principle for the conduct of public affairs in a genuinely open democracy,
with the people‘s right to know as the centerpiece. It is a mandate of the State to be
accountable by following such policy. These provisions are vital to the exercise of the
freedom of expression and essential to hold public officials at all times accountable to the
people. Indubitably, the effectivity of the policy of public disclosure need not await the
passing of a statute. As Congress cannot revoke this principle, it is merely directed to
provide for ―reasonable safeguards.‖ The complete and effective exercise of the right to
information necessitates that its complementary provision on public disclosure derive the
same self-executory nature. Since both provisions go hand-in-hand, it is absurd to say
that the broader right to information on matters of public concern is already enforceable
while the correlative duty of the State to disclose its transactions involving public interest
is not enforceable until there is an enabling law. Respondents cannot thus point to the
absence of an implementing legislation as an excuse in not effecting such policy. An
essential element of these freedoms is to keep open a continuing dialogue or process of
communication between the government and the people. It is in the interest of the State
that the channels for free political discussion be maintained to the end that the
government may perceive and be responsive to the people‘s will. Envisioned to be
corollary to the twin rights to information and disclosure is the design for feedback
mechanisms. The imperative of a public consultation, as a species of the right to
information, is evident in the ―marching orders‖ to respondents. The mechanics for the
duty to disclose information and to conduct public consultation regarding the peace
agenda and process is manifestly provided by E.O. No. 3. The preambulatory clause of
E.O. No. 3 declares that there is a need to further enhance the contribution of civil society
to the comprehensive peace process by institutionalizing the people‘s participation. One
of the three underlying principles of the comprehensive peace process is that it ―should
be community-based, reflecting the sentiments, values and principles important to all
Filipinos and ―shall be defined not by the government alone, nor by the different
contending groups only, but by all Filipinos as one community. Included as a component
of the comprehensive peace process is consensus-building and empowerment for peace,
which includes ―continuing consultations on both national and local levels to build
consensus for a peace agenda and process, and the mobilization and facilitation of
people‘s participation in the peace process.Clearly, E.O. No. 3 contemplates not just the
conduct of a plebiscite to effectuate “continuing” consultations, contrary to respondents’
position that plebiscite is “more than sufficient consultation.Further, E.O. No. 3
enumerates the functions and responsibilities of the PAPP, one of which is to ―conduct
regular dialogues with the National Peace Forum (NPF) and other peace partners to seek
relevant information, comments, recommendations as well as to render appropriate and
timely reports on the progress of the comprehensive peace process. E.O. No. 3 mandates
the establishment of the NPF to be ―the principal forum for the Presidential Adviser on
Peace Progress (PAPP) to consult with and seek advi[c]e from the peace advocates, peace
partners and concerned sectors of society on both national and local levels, on the
implementation of the comprehensive peace process, as well as for government[-]civil
society dialogue and consensus-building on peace agenda and initiatives. In fine, E.O. No.
3 establishes petitioners’ right to be consulted on the peace agenda, as a corollary to the
constitutional right to information and disclosure. In general, the objections against the
MOA-AD center on the extent of the powers conceded therein to the BJE. Petitioners
assert that the powers granted to the BJE exceed those granted to any local government
under present laws, and even go beyond those of the present ARMM. Before assessing
some of the specific powers that would have been vested in the BJE, however, it would be
useful to turn first to a general idea that serves as a unifying link to the different provisions
of the MOA-AD, namely, the international law concept of association. Significantly, the
MOA-AD explicitly alludes to this concept, indicating that the Parties actually framed its
provisions with it in mind. Association is referred to in paragraph 3 on TERRITORY,
paragraph 11 on RESOURCES, and paragraph 4 on GOVERNANCE. It is in the last
mentioned provision, however, that the MOA-AD most clearly uses it to describe the
envisioned relationship between the BJE and the Central Government.

4. The relationship between the Central Government and the Bangsamoro juridical entity
shall be associative characterized by shared authority and responsibility with a structure
of governance based on executive, legislative, judicial and administrative institutions with
defined powers and functions in the comprehensive compact. A period of transition shall
be established in a comprehensive peace compact specifying the relationship between the
Central Government and the BJE. The nature of the ―associative relationship may have
been intended to be defined more precisely in the still to be forged Comprehensive
Compact. Nonetheless, given that there is a concept of ―association in international law,
and the MOA-AD – by its inclusion of international law instruments in its TOR– placed
itself in an international legal context, that concept of association may be brought to bear
in understanding the use of the term ―associative in the MOA-AD. The MOA-AD contains
many provisions which are consistent with the international legal concept of association,
specifically the following: the BJE‘s capacity to enter into economic and trade relations
with foreign countries, the commitment of the Central Government to ensure the BJE‘s
participation in meetings and events in the ASEAN and the specialized UN agencies, and
the continuing responsibility of the Central Government over external defense. Moreover,
the BJE‘s right to participate in Philippine official missions bearing on negotiation of
border agreements, environmental protection, and sharing of revenues pertaining to the
bodies of water adjacent to or between the islands forming part of the ancestral domain,
resembles the right of the governments of FSM and the Marshall Islands to be consulted
by the U.S. government on any foreign affairs matter affecting them. These provisions of
the MOA indicate, among other things, that the Parties aimed to vest in the BJE the status
of an associated state or, at any rate, a status closely approximating it. The concept of
association is not recognized under the present Constitution. No province, city, or
municipality, not even the ARMM, is recognized under our laws as having an
―associative‖ relationship with the national government. Indeed, the concept implies
powers that go beyond anything ever granted by the Constitution to any local or regional
government. It also implies the recognition of the associated entity as a state. The
Constitution, however, does not contemplate any state in this jurisdiction other than the
Philippine State, much less does it provide for a transitory status that aims to prepare any
part of Philippine territory for independence.
Even the mere concept animating many of the MOA-AD‘s provisions, therefore, already
requires for its validity the amendment of constitutional provisions, specifically the
following provisions of Article X:
SECTION 1. The territorial and political subdivisions of the Republic of the Philippines
are the provinces, cities, municipalities, and barangays. There shall be autonomous
regions in Muslim Mindanao and the Cordilleras as hereinafter provided. SECTION 15.
There shall be created autonomous regions in Muslim Mindanao and in the Cordilleras
consisting of provinces, cities, municipalities, and geographical areas sharing common
and distinctive historical and cultural heritage, economic and social structures, and other
relevant characteristics within the framework of this Constitution and the national
sovereignty as well as territorial integrity of the Republic of the Philippines.
It is not merely an expanded version of the ARMM, the status of its relationship with the
national government being fundamentally different from that of the ARMM. Indeed, BJE
is a state in all but name as it meets the criteria of a state laid down in the Montevideo
Convention, namely, a permanent population, a defined territory, a government, and a
capacity to enter into relations with other states.
The defining concept underlying the relationship between the national government and
the BJE being itself contrary to the present Constitution, it is not surprising that many of
the specific provisions of the M OA-AD on the formation and powers of the BJE are in
conflict with the Constitution and the laws. Article X, Section 18 of the Constitution
provides that ―[t]he creation of the autonomous region shall be effective when approved
by a majority of the votes cast by the constituent units in a plebiscite called for the
purpose, provided that only provinces, cities, and geographic areas voting favorably in
such plebiscite shall be included in the autonomous region.
The BJE is more of a state than an autonomous region. But even assuming that it is
covered by the term ―autonomous region in the constitutional provision just quoted, the
MOA-AD would still be in conflict with it. Under paragraph 2(c) on TERRITORY in
relation to 2(d) and 2(e), the present geographic area of the ARMM and, in addition, the
municipalities of Lanao del Norte which voted for inclusion in the ARMM during the 2001
plebiscite – Baloi, Munai, Nunungan, Pantar, Tagoloan and Tangkal – are automatically
part of the BJE without need of another plebiscite, in contrast to the areas under
Categories A and B mentioned earlier in the overview. That the present components of
the ARMM and the above-mentioned municipalities voted for inclusion therein in 2001,
however, does not render another plebiscite unnecessary under the Constitution,
precisely because what these areas voted for then was their inclusion in the ARMM, not
the BJE.
Article II, Section 22 of the Constitution must also be amended if the scheme envisioned
in the MOA-AD is to be effected. That constitutional provision states: ―The State
recognizes and promotes the rights of indigenous cultural communities within the
framework of national unity and development. An associative arrangement does not
uphold national unity. While there may be a semblance of unity because of the associative
ties between the BJE and the national government, the act of placing a portion of
Philippine territory in a status which, in international practice, has generally been a
preparation for independence, is certainly not conducive to national unity.
The MOA-AD cannot be reconciled with the present Constitution and laws. Not only its
specific provisions but the very concept underlying them, namely, the associative
relationship envisioned between the GRP and the BJE, are unconstitutional, for the
concept presupposes that the associated entity is a state and implies that the same is on
its way to independence.
While there is a clause in the MOA-AD stating that the provisions thereof inconsistent
with the present legal framework will not be effective until that framework is amended,
the same does not cure its defect. The inclusion of provisions in the MOA-AD establishing
an associative relationship between the BJE and the Central Government is, itself, a
violation of the Memorandum of Instructions from the President dated March 1, 2001,
addressed to the government peace panel. Moreover, as the clause is worded, it virtually
guarantees that the necessary amendments to the Constitution and the laws will
eventually be put in place. Neither the GRP Peace Panel nor the President herself is
authorized to make such a guarantee. Upholding such an act would amount to authorizing
a usurpation of the constituent powers vested only in Congress, a Constitutional
Convention, or the people themselves through the process of initiative, for the only way
that the Executive can ensure the outcome of the amendment process is through an undue
influence or interference with that process.

Public International Law: Plaridel M. Abaya vs. Hon.

Secretary Hermogenes E. Ebdane, Jr.G. R. No. 167919
February 14, 2007
G. R. No. 167919
February 14, 2007
Plaridel M. Abaya vs. Hon. Secretary Hermogenes E. Ebdane, Jr.

FACTS:
On May 7, 2004 Bids and Awards Committee (BAC) of the Department of Public Works and Highways
(DPWH) issued a Resolution No. PJHL-A-04-012. It was approved by DPWH Acting Secretary Florante
Soriquez. This resolution recommended the award to China Road & Bridge Corporation of the contract
for the implementation of civil works for Contract Package No. I (CP I), which consists of the
improvement/rehabilitation of the San Andres-Virac-Jct. Bago-Viga road, with the lengt of 79.818
kilometers, in the island province of Catanduanes.
This Loan Agreement No. PH-204 was executed by and between the JBIC and the Philippine
Government pursuant to the exchange of Notes executed by and between Mr. Yoshihisa Ara,
Ambassador Extraordinary and Plenipotentiary of Japan to the Philippines, and then Foreign Affairs
Secretary Siazon, in behalf of their respective governments.

ISSUE:
Whether or not the Loan Agreement No. PH-204 between the JBIC and the Philippine Government is a
kind of a treaty.

HELD:
The Loan Agreement No. PH-204 taken in conjunction with the Exchange of Notes dated December 27,
1999 between the Japanese Government and the Philippine Government is an executive agreement.
An “exchange of notes” is a record of a routine agreement that has many similarities with the private
law contract. The agreement consists of the exchange of two documents, each of the parties being in
the possession of the one signed by the representative of the other.
…treaties, agreements, conventions, charters, protocols, declarations, memoranda of understanding,
modus vivendi and exchange of notes all are refer to international instruments binding at international
law.
Although these instruments differ from each other by title, they all have common features and
international law has applied basically the same rules to all these instruments. These rules are the
result of long practice among the States, which have accepted them as binding norms in their mutual
relations. Therefore, they are regarded as international customary law.
That case was dismissed by the SCORP last Feb. 14 2007.

What the petitioners wanted was that Foreign funded projects also undergo the procurement process.
The dismissal of the case somehow gave justification for the delay of the implementing rules for foreign
funded projects (IRR-B) of the procurement law If we recall the decision of the Abaya vs Ebdane was
used by the DOJ when the DOTC Secretary was asking for an opinion from the former, during the ZTE
controversy.as ruled by the Supreme Court in Abaya v. Ebdane, an exchange of notes is considered a
form of an executive agreement, which becomes binding through executive action without need of a
vote by the
Senate and that (like treaties and conventions, it is an international instrument binding at international
law,
The second issue involves an examination of the coverage of Republic Act No. 9184, otherwise known as
the “Government Procurement Reform Act”. Section 4 of the said Act provides that it shall
apply to: … the Procurement of infrastructure Projects, Goods and Consulting Services, regardless of
source of funds, whether local or foreign, by all branches and instrumentalities of government, its
departments, offices and agencies, including government-owned and/or -controlled corporations and
local government units, subject to the provisions of Commonwealth Act No. 138. Any treaty or
international or executive agreement affecting the subject matter of this Act to which the Philippine
government is a signatory shall be observed.

CASE DIGEST : PHARMACEUTICAL Vs Duque

G.R. No. 173034 October 9, 2007 PHARMACEUTICAL AND HEALTH CARE ASSOCIATION OF
THE PHILIPPINES, petitioner, vs. HEALTH SECRETARY FRANCISCO T. DUQUE III; HEALTH UNDER
SECRETARIES DR. ETHELYN P. NIETO, DR. MARGARITA M. GALON, ATTY. ALEXANDER A.
PADILLA, & DR. JADE F. DEL MUNDO; and ASSISTANT SECRETARIES DR. MARIO C. VILLAVERDE,
DR. DAVID J. LOZADA, AND DR. NEMESIO T. GAKO, respondents.

FACTS : Named as respondents are the Health Secretary, Undersecretaries, and Assistant Secretaries of
the Department of Health (DOH). For purposes of herein petition, the DOH is deemed impleaded as a co-
respondent since respondents issued the questioned RIRR in their capacity as officials of said executive
agency.1Executive Order No. 51 (Milk Code) was issued by President Corazon Aquino on October 28,
1986 by virtue of the legislative powers granted to the president under the Freedom Constitution. One of
the preambular clauses of the Milk Code states that the law seeks to give effect to Article 112 of the
International Code of Marketing of Breastmilk Substitutes (ICMBS), a code adopted by the World Health
Assembly (WHA) in 1981. From 1982 to 2006, the WHA adopted several Resolutions to the effect that
breastfeeding should be supported, promoted and protected, hence, it should be ensured that nutrition
and health claims are not permitted for breastmilk substitutes.In 1990, the Philippines ratified the
International Convention on the Rights of the Child. Article 24 of said instrument provides that State
Parties should take appropriate measures to diminish infant and child mortality, and ensure that all
segments of society, specially parents and children, are informed of the advantages of breastfeeding. On
May 15, 2006, the DOH issued herein assailed RIRR which was to take effect on July 7, 2006.

Issue: . Whether Administrative Order or the Revised Implementing Rules and Regulations (RIRR) issued
by the Department of Health (DOH) is not constitutional;

Held: YES

under Article 23, recommendations of the WHA do not come into force for members,in the same way that
conventions or agreements under Article 19 and regulations under Article 21 come into force. Article 23 of
the WHO Constitution reads:
Article 23. The Health Assembly shall have authority to make recommendations to Members with respect
to any matter within the competence of the Organization
for an international rule to be considered as customary law, it must be established that such rule is being
followed by states because they consider it obligatory to comply with such rules

Under the 1987 Constitution, international law can become part of the sphere of domestic law either
By transformation or incorporation. The transformation method requires that an international law be
transformed into a domestic law through a constitutional mechanism such as local legislation. The
incorporation method applies when, by mere constitutional declaration, international law is deemed to
have the force of domestic law.

Consequently, legislation is necessary to transform the provisions of the WHA Resolutions into domestic
law. The provisions of the WHA Resolutions cannot be considered as part of the law of the land that can
be implemented by executive agencies without the need of a law enacted by the legislature

DENNIS A. B. FUNA v. EXECUTIVE SECRETARY EDUARDO R. ERMITA, GR No.

184740, 2010-02-11
Facts:
On October 4, 2006, President Gloria Macapagal-Arroyo appointed respondent Maria Elena
H. Bautista (Bautista) as Undersecretary of the Department of Transportation and
Communications (DOTC)
Bautista was designated as Undersecretary for Maritime
Transport of the department under Special Order No. 2006-171 dated October 23, 2006
On September 1, 2008, following the resignation of then MARINA Administrator Vicente T.
Suazo, Jr., Bautista was designated as Officer-in-Charge (OIC), Office of the Administrator,
MARINA, in concurrent capacity as DOTC Undersecretary
On October 21, 2008, Dennis A. B. Funa in his capacity as taxpayer, concerned citizen and
lawyer, filed the instant petition challenging the constitutionality of Bautista's
appointment/designation, which is proscribed by the prohibition on the President, Vice-
President, the
Members of the Cabinet, and their deputies and assistants to hold any other office or
employment
Issues:
Petitioner argues that Bautista's concurrent positions as DOTC Undersecretary and
MARINA OIC is in violation of Section 13, Article VII of the 1987 Constitution
He points out that while it was clarified in Civil Liberties Union that the prohibition does not
apply to those... positions held in ex-officio capacities, the position of MARINA Administrator
is not ex-officio to the post of DOTC Undersecretary
The fact that Bautista was extended an appointment naming her as OIC of MARINA shows
that she does not occupy it in an ex-officio capacity since an ex-officio position does not
require any "further warrant or appoint.
Petitioner further contends that even if Bautista's appointment or designation as OIC of
MARINA was intended to be merely temporary, still, such designation must not violate a
standing constitutional prohibition
Petitioner likewise asserts the incompatibility between the posts of DOTC Undersecretary
and MARINA Administrator... respondents submit that the petition should still be dismissed
for being unmeritorious considering that Bautista's concurrent designation as MARINA OIC
and DOTC Undersecretary was... constitutional. There was no violation of Section 13,
Article VII of the 1987 Constitution because respondent Bautista was merely designated
acting head of MARINA on September 1, 2008. She was designated MARINA OIC, not
appointed MARINA Administrator.
The sole issue to be resolved is whether or not the designation of respondent Bautista as
OIC of MARINA, concurrent with the position of DOTC Undersecretary for Maritime
Transport to which she had been appointed, violated the constitutional proscription against
dual or multiple... offices for Cabinet Members and their deputies and assistants.
Ruling:
These sweeping, all-embracing prohibitions imposed on the President and his official family,
which prohibitions are not similarly imposed on other public officials or employees such as
the Members of Congress, members of the civil service in general and members of... the
armed forces, are proof of the intent of the 1987 Constitution to treat the President and his
official family as a class by itself and to impose upon said class stricter prohibitions.
Thus, while all other appointive officials in the civil service are allowed to hold other office or
employment in the government during their tenure when such is allowed by law or by the
primary functions of their positions, members of the Cabinet, their deputies and... assistants
may do so only when expressly authorized by the Constitution itself.
Since the evident purpose of the framers of the 1987 Constitution is to impose a stricter
prohibition on the President, Vice-President, members of the Cabinet, their deputies and
assistants with respect to holding multiple offices or employment in the government during...
their tenure, the exception to this prohibition must be read with equal severity. On its face,
the language of Section 13, Article VII is prohibitory so that it must be understood as
intended to be a positive and unequivocal negation of the privilege of holding multiple...
government offices or employment.
Respondent Bautista being then the appointed Undersecretary of DOTC, she was thus
covered by the stricter prohibition under Section 13, Article VII and consequently she cannot
invoke the exception provided in Section 7, paragraph 2, Article IX-B where holding
another... office is allowed by law or the primary functions of the position.
WHEREFORE, the petition is GRANTED. The designation of respondent Ma. Elena H.
Bautista as Officer-in-Charge, Office of the Administrator, Maritime Industry Authority, in a
concurrent capacity with her position as DOTC Undersecretary for Maritime Transport, is...
hereby declared UNCONSTITUTIONAL for being violative of Section 13, Article VII of the
1987 Constitution and therefore, NULL and VOID.
Principles:
Sec. 13. The President, Vice-President, the Members of the Cabinet, and their deputies or
assistants shall not, unless otherwise provided in this Constitution, hold any other office or
employment during their tenure. They shall not, during said tenure,... directly or indirectly
practice any other profession, participate in any business, or be financially interested in any
contract with, or in any franchise, or special privilege granted by the Government or any
subdivision, agency, or instrumentality thereof, including... government-owned or controlled
corporations or their subsidiaries. They shall strictly avoid conflict of interest in the conduct
of their office.
Sec. 7. x x x
Unless otherwise allowed by law or the primary functions of his position, no appointive
official shall hold any other office or employment in the Government or any subdivision,
agency or instrumentality thereof, including government-owned or controlled corporations
or... their subsidiaries.
Appointment may be defined as the selection, by the authority vested with the power, of an
individual who is to exercise the functions of a given office. When completed, usually with its
confirmation, the appointment results in security of tenure for the... person chosen unless
he is replaceable at pleasure because of the nature of his office. Designation, on the other
hand, connotes merely the imposition by law of additional duties on an incumbent official, as
where, in the case before us, the Secretary of Tourism is designated
Chairman of the Board of Directors of the Philippine Tourism Authority, or where, under the
Constitution, three Justices of the Supreme Court are designated by the Chief Justice to sit
in the Electoral Tribunal of the Senate or the House of Representatives. It is said that...
appointment is essentially executive while designation is legislative in nature.
Designation may also be loosely defined as an appointment because it likewise involves the
naming of a particular person to a specified public office. That is the common understanding
of the term. However, where the person is merely designated and not appointed, the...
implication is that he shall hold the office only in a temporary capacity and may be replaced
at will by the appointing authority. In this sense, the designation is considered only an acting
or temporary appointment, which does not confer security of tenure on the... person named.
JOKER P. ARROYO v. JOSE DE VENECIA, GR No. 127255, 1997-08-14
Facts:
hallenging the validity of Republic Act No. 8240... charging violation of the rules of the
House which petitioners claim are "constitutionally mandated" so that their violation is
tantamount to a violation of the Constitution.
The bicameral conference committee submitted its report to the House at 8 a.m. on
November 21, 1996. At 11:48 a.m., after a recess, Rep. Exequiel Javier, chairman of the
Committee on Ways and Means, proceeded to deliver his sponsorship speech, after which
he was interpellated.
He was interrupted when Rep. Arroyo moved to adjourn for lack of quorum. Rep.
In the course of his interpellation, Rep. Arroyo announced that he was going to raise a
question on the quorum,... although until the end of his interpellation he never did.
On the same day, the bill was signed by the Speaker of the House of Representatives and
the President of the Senate and certified by the respective secretaries of both Houses of
Congress as having been finally passed by the House of Representatives and by the
Senate on November
21, 1996. The enrolled bill was signed into law by President Fidel V. Ramos on November
22, 1996.
etitioners' principal argument is that R.A. No. 8240 is null and void because it was passed in
violation of the rules of the House; that these rules embody... the "constitutional mandate" in
Art. VI, §16(3) that "each House may determine the rules of its proceedings" and that,
consequently, violation of the House rules is a violation of the Constitution itself. They
contend that the certification of Speaker De Venecia that the law was... properly passed is
false and spurious.
Petitioners also charge that the session was hastily adjourned at 3:40 p.m. on November
21, 1996 and the bill certified by Speaker Jose De Venecia to prevent petitioner Rep. Arroyo
from formally challenging the existence of a quorum and asking for a reconsideration.
In his supplemental comment, respondent De Venecia denies that his certification of H. No.
7198 is false and spurious and contends that under the journal entry rule, the judicial inquiry
sought by the petitioners is barred.
This Journal was approved on December 2, 1996 over the lone... objection of petitioner
Rep. Lagman.[8]
ADJOURNMENT OF SESSION
On motion of Mr. Albano, there being no objection, the Chair declared the session
adjourned until four o'clock in the afternoon of Wednesday, November 27, 1996.
It was 3:40 p.m. Thursday, November 21, 1996. (emphasis added)
This Journal was approved on December 2, 1996. Again, no one objected to its approval
except Rep. Lagman.
Issues:
Petitioners claim that the passage of the law in the House was "railroaded." They claim that
Rep. Arroyo was still making a query to the Chair when the latter declared Rep. Albano's
motion approved.
Ruling:
"When it appears that an act was so passed, no inquiry will be permitted to asce... n this
case no rights of private individuals are involved but only those of a member who, instead of
seeking redress in the House, chose to transfer the dispute to this Court
Petitioners argue that, in accordance with the rules of the House, Rep. Albano's motion for
the approval of the conference committee report should have been stated by the Chair and
later the individual votes of the Members should have been taken. They say that the method
used in... this case is a legislator's nightmare because it suggests unanimity when the fact
was that one or some legislators opposed the report.
No rule of the House of Representatives has been cited which specifically requires that in
cases such as this involving approval of a conference committee report, the Chair must
restate the motion and conduct a viva voce or nominal voting.
It is thus apparent that petitioners' predicament was largely of their own making. Instead of
submitting the proper motions for the House to act upon, petitioners insisted on the
pendency of Rep. Arroyo's question as an obstacle to the passage of the bill. But Rep.
Arroyo's... question was not, in form or substance, a point of order or a question of privilege
entitled to precedence.[30] And even if Rep. Arroyo's question were so, Rep. Albano's
motion to adjourn would have precedence and would have put an end to any further...
consideration of the question.[31]
To repeat, the claim is not that there was no quorum but only that Rep. Arroyo was
effectively prevented from questioning the presence of a quorum.
Rep. Arroyo's earlier motion to adjourn for lack of quorum had already been defeated, as
the roll call established the existence of a quorum. The question of quorum cannot be raised
repeatedly especially when the quorum is obviously present for the purpose of delaying
the... business of the House.[
Rep. Arroyo waived his objection by his continued interpellation of the sponsor for in so
doing he in effect acknowledged the presence of a quorum.[3
34 Phil. 729, 735
Principles:
Nor does the Constitution require that the yeas and the nays of the Members be taken
every time a House has to vote, except only in the following instances: upon the last and
third readings of a bill,[26] at the request of one-fifth of the Members... present,[27] and in
repassing a bill over the veto of the President.[28] Indeed, considering the fact that in the
approval of the original bill the votes of the Members by yeas and nays had already been
taken, it would have been sheer... tedium to repeat the process.
Indeed, the phrase "grave abuse of discretion amounting to lack or excess... of jurisdiction"
has a settled meaning in the jurisprudence of procedure.
ABAKADA Guro Party List vs Executive Secretary

Bills Must Originate EXCLUSIVELY from the House of Representatives; Undue Delegation of Legislative
Power; Equal Protection Clause

ABAKADA GURO PARTY LIST VS EXECUTIVE SECRETARY

G.R. No. 168056 September 1, 2005

ABAKADA GURO PARTY LIST (Formerly AASJAS) OFFICERS SAMSON S. ALCANTARA and ED VINCENT S.
ALBANO, Petitioners,
vs.
THE HONORABLE EXECUTIVE SECRETARY EDUARDO ERMITA; HONORABLE SECRETARY OF THE
DEPARTMENT OF FINANCE CESAR PURISIMA; and HONORABLE COMMISSIONER OF INTERNAL REVENUE
GUILLERMO PARAYNO, JR., Respondent.
Facts:

Petitioners ABAKADA GURO Party List challenged the constitutionality of R.A. No. 9337 particularly
Sections 4, 5 and 6, amending Sections 106, 107 and 108, respectively, of the National Internal Revenue
Code (NIRC). These questioned provisions contain a uniform proviso authorizing the President, upon
recommendation of the Secretary of Finance, to raise the VAT rate to 12%, effective January 1, 2006,
after any of the following conditions have been satisfied, to wit:

. . . That the President, upon the recommendation of the Secretary of Finance, shall, effective January 1,
2006, raise the rate of value-added tax to twelve percent (12%), after any of the following conditions has
been satisfied:

(i) Value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year
exceeds two and four-fifth percent (2 4/5%); or

(ii) National government deficit as a percentage of GDP of the previous year exceeds one and one-half
percent (1 ½%).

Petitioners argue that the law is unconstitutional, as it constitutes abandonment by Congress of its
exclusive authority to fix the rate of taxes under Article VI, Section 28(2) of the 1987 Philippine
Constitution. They further argue that VAT is a tax levied on the sale or exchange of goods and services
and cannot be included within the purview of tariffs under the exemption delegation since this refers to
customs duties, tolls or tribute payable upon merchandise to the government and usually imposed on
imported/exported goods. They also said that the President has powers to cause, influence or create the
conditions provided by law to bring about the conditions precedent. Moreover, they allege that no
guiding standards are made by law as to how the Secretary of Finance will make the
recommendation. They claim, nonetheless, that any recommendation of the Secretary of Finance can
easily be brushed aside by the President since the former is a mere alter ego of the latter, such that,
ultimately, it is the President who decides whether to impose the increased tax rate or not.

Issues:

Whether or not R.A. No. 9337 has violated the provisions in Article VI, Section 24, and Article VI, Section
26 (2) of the Constitution.

Whether or not there was an undue delegation of legislative power in violation of Article VI Sec 28 Par 1
and 2 of the Constitution.

Whether or not there was a violation of the due process and equal protection under Article III Sec. 1 of
the Constitution.

Discussions:

Basing from the ruling of Tolentino case, it is not the law, but the revenue bill which is required by the
Constitution to “originate exclusively” in the House of Representatives, but Senate has the power not
only to propose amendments, but also to propose its own version even with respect to bills which are
required by the Constitution to originate in the House. the Constitution simply means is that the
initiative for filing revenue, tariff or tax bills, bills authorizing an increase of the public debt, private bills
and bills of local application must come from the House of Representatives on the theory that, elected
as they are from the districts, the members of the House can be expected to be more sensitive to the
local needs and problems. On the other hand, the senators, who are elected at large, are expected to
approach the same problems from the national perspective. Both views are thereby made to bear on
the enactment of such laws.

In testing whether a statute constitutes an undue delegation of legislative power or not, it is usual to
inquire whether the statute was complete in all its terms and provisions when it left the hands of the
legislature so that nothing was left to the judgment of any other appointee or delegate of the
legislature.

The equal protection clause under the Constitution means that “no person or class of persons shall be
deprived of the same protection of laws which is enjoyed by other persons or other classes in the same
place and in like circumstances.”

Rulings:

R.A. No. 9337 has not violated the provisions. The revenue bill exclusively originated in the House of
Representatives, the Senate was acting within its constitutional power to introduce amendments to the
House bill when it included provisions in Senate Bill No. 1950 amending corporate income taxes,
percentage, excise and franchise taxes. Verily, Article VI, Section 24 of the Constitution does not contain
any prohibition or limitation on the extent of the amendments that may be introduced by the Senate to
the House revenue bill.

There is no undue delegation of legislative power but only of the discretion as to the execution of a law.
This is constitutionally permissible. Congress does not abdicate its functions or unduly delegate power
when it describes what job must be done, who must do it, and what is the scope of his authority; in our
complex economy that is frequently the only way in which the legislative process can go forward.

Supreme Court held no decision on this matter. The power of the State to make reasonable and natural
classifications for the purposes of taxation has long been established. Whether it relates to the subject
of taxation, the kind of property, the rates to be levied, or the amounts to be raised, the methods of
assessment, valuation and collection, the State’s power is entitled to presumption of validity. As a rule,
the judiciary will not interfere with such power absent a clear showing of unreasonableness,
discrimination, or arbitrariness.

Defensor-Santiago vs. Guingona G.R. No. 134577, November 18,

1998
Sunday, January 25, 2009 Posted by Coffeeholic Writes
Labels: Case Digests, Political Law
Facts: During the first regular session of the eleventh Congress, Senator
Fernan was declared the duly elected President of the Senate by a vote of 20 to
2. Senator Tatad manifested that, with the agreement of Senator Santiago,
allegedly the only other member of the minority, he was assuming the position
of minority leader. He explained that those who had voted for Senator Fernan
comprised the majority, while only those who had voted for him, the losing
nominee, belonged to the minority. Senator Flavier manifested that the senators
belonging to the Lakas-NUCD-UMDP Party numbering 7 and, thus, also a minority
had chosen Senator Guingona as the minority leader. Thereafter, the majority
leader informed the body that he was in receipt of a letter signed by the 7 Lakas-
NUCD-UMDP senators, stating that they had elected Senator Guingona as the
minority leader. By virtue thereof, the Senate President formally recognized
Senator Guingona as the minority leader of the Senate. Senators Santiago and
Tatad filed a petition for quo warranto, alleging that Senator Guingona had been
usurping, unlawfully holding and exercising the position of Senate minority
leader, a position that, according to them, rightfully belonged to Senator Tatad.

Issues:
(1) Whether or not the Court has jurisdiction over the petition
(2) Whether or not there is an actual violation of the Constitution

Held: Regarding the first issue, jurisdiction over the subject matter of a
case is determined by the allegations of the complaint or petition, regardless of
whether the petitioner is entitled to the relief asserted. In light of the allegations
of the petitioners, it is clear that the Court has jurisdiction over the petition. It is
well within the power and jurisdiction of the Court to inquire whether indeed the
Senate or its officials committed a violation of the Constitution or gravely abused
their discretion in the exercise of their functions and prerogatives.

However, the interpretation proposed by petitioners finds no clear support from

the Constitution, the laws, the Rules of the Senate or even from practices of the
Upper House. The term “majority,” when referring to a certain number out of a
total or aggregate, it simply means the number greater than half or more than
half of any total. In effect, while the Constitution mandates that the President of
the Senate must be elected by a number constituting more than one half of all
the members thereof, it does not provide that the members who will not vote for
him shall ipso facto constitute the minority, who could thereby elect the minority
leader. No law or regulation states that the defeated candidate shall automatically
become the minority leader.

While the Constitution is explicit in the manner of electing a Senate President and
a House Speaker, it is, however, dead silent on the manner of selecting the other
officers in both chambers of Congress. All that the Charter says under Art. VI,
Sec. 16(1) is that “each House shall choose such other officers as it may deem
necessary.” The method of choosing who will be such other officers is merely a
derivative of the exercise of the prerogative conferred by the said constitutional
provision. Therefore, such method must be prescribed by the Senate itself, not
by the Court.
EUGENIO J. PUYAT v. SIXTO T. J. DE GUZMAN, GR No. L-51122, 1982-03-25
Facts:
Order
Associate Commissioner of the Securities and Exchange Commission (SEC)... granting
Assemblyman Estanislao A. Fernandez leave to intervene in
SEC Case... the Puyat Group would be in control of the Board... management of IPI.
Acero Group... instituted... quowarranto proceedings... questioning the election...
stockholders' votes were not properly counted.
nstituted a case
Court of First Instance of Rizal... to annul the sale of Excelsior's... share
In that case, Assemblyman Fernandez appeared as counsel for defendant Excelsior.
Issues:
whether or not Assemblyman Fernandez, as a then stockholder of IPI, may intervene in the
SEC Case without violating Section 11, Article VIII of the Constitution,... whether or not, in
intervening in the SEC Case, Assemblyman Fernandez is, in effect, appearing as counsel,
albeit indirectly, before an administrative body in contravention of the Constitutional
provision.
Ruling:
certain salient circumstances militate against the intervention of Assemblyman Fernandez in
the SEC Case... acquired a mere P200.00 worth of stock in IPI, representing ten shares out
of 262,843 outstanding share... acquired them "after the fact",... that is, on May 30, 1979,
after the contested election of Directors... after the quo warranto suit... one day before the
scheduled hearing of the case before the SEC... before... he moved to intervene, he had
signified his intention to appear as counsel for respondent Eustaquio T. C. Acero
Under those facts and circumstances, we are constrained to find that there has been an
indirect "appearance as counsel before x x x an administrative body"... that is a
circumvention of the Constitutional prohibition.
"intervention" was an... afterthought
All an Assemblyman need do, if he wants to influence an administrative body is to acquire a
minimal participation in the "interest" of the client and then "intervene" in the... proceedings.
Principles:
Ordinarily, by virtue of the Motion for Intervention, Assemblyman Fernandez cannot be said
to be appearing as counsel.
His appearance could... theoretically be for the protection of his ownership of ten (10)
shares of IPI in respect of the matter in litigation and not for the protection of the petitioners
nor respondents who have their respective capable and respected counsel.

PVTA v CIR Digest

Facts:
This case involves the expanded role of the
government necessitated by the increased responsibility to provide for the general welfare.
1. In 1966 private respondents filed a petition seeking relief for their alleged overtime
services and the petitioner’s failure to pay for said compensation in accordance with CA No.
444.
2. Petitioner denied the allegations for lack of a cause of cause of action and lack of
jurisdiction. Judge Martinez issued an order, directing petitioner to pay. Hence, this petition
for certiorari on grounds that the corporation is exercising governmental functions and is
therefore exempt from Commonwealth Act No. 444.
3. PVTA contended it is beyond the jurisdiction of respondent Court as it is exercising
governmental functions and that it is exempt from the operation of Commonwealth Act No.
444.

Issue: Whether or not PVTA discharges governmental and not proprietary functions.

YES. But the distinction between the constituent and ministrant functions of the government has
become obsolete. The government has to provide for the welfare of its people. RA No. 2265 providing
for a distinction between constituent and the ministrant functions is irrelevant considering the needs of
the present time: “The growing complexities of modern society have rendered this traditional
classification of the functions of government obsolete.”

The contention of petitioner that the Labor Code does not apply to them deserve scant consideration.
There is no question based on RA 4155, that petitioner is a governmental agency. As such, the
petitioner can rightfully invoke the doctrine announced in the leading ACCFA case. The objection of
private respondents with its overtones of the distinction between constituent and ministrant functions
of governments as set forth in Bacani v. Nacoco, is futile. It does not necessarily follow, that just
because petitioner is engaged in governmental rather than proprietary functions, that the labor
controversy was beyond the jurisdiction of the now defunct respondent Court. Nor is the objection
raised that petitioner does not come within the coverage of the Eight-Hour Labor Law persuasive.

A reference to the pertinent sections of both Republic Acts 2265 and 2155 renders clear the
differentiation that exists. If as a result of the appealed order, financial burden would have to be borne
by petitioner, it has only itself to blame. It need not have required private respondents to render
overtime service. It can hardly be surmised that one of its chief problems is paucity of personnel. That
would indeed be a cause for astonishment. It would appear, therefore, that such an objection based
on this ground certainly cannot suffice for a reversal. To repeat, respondent Court must be sustained.

PEOPLE'S HOMESITE AND HOUSING CORPORATION (PHHC) vs. COURT OF INDUSTRIAL RELATIONS (CIR)
[G.R. No. L-31890; May 29, 1987]

Facts:

The PHHC seeks a reversal of the Resolution of the CIR en banc in ordering them to pay private
respondents wage differential for work. The Philippine government and World Food Program (WFP)
entered into an agreement in a plan for the Sapang Palay resettlement area in the PHHC proposing a
self-help project to be undertaken by the squatter families for the construction of two dams. The
undertaking is for the purpose of water irrigation to be used for additional food production. In recruiting
participants to the program, the WFP issued an application form mentioning the voluntary nature of the
work to be rendered. The participants were assigned to work on canals and roads; however, the projects
agreed between the PHHC and WFP were never fully implemented. They were ordered to accomplish a
time sheet which is the basis for the payment of 50 centavos/day and a weekly food ration. They were
also provided with work tools and assigned a work supervisor to manage and administer the Sapang
Palay project in which the latter also conducted ocular inspection in the area. However, the participants
went to the Department of Labor complaining about their work and compensation which Secretary Ople
suggest that the workers in the said project must be paid in minimum wage law. After that, petitioner
suspended work and the workers assert their minimum wage and the 50 centavos be paid to them. The
petitioner answered before the CIR that they were exercising governmental functions and that they did
not hire private respondents and CIR had no jurisdiction over them. The Court dismissed the action of
the petitioner since there was no evidence that private respondents rendered overtime work. The
petitioner moved to reconsider before the CIR but denied the claims. Thus, they elevated the case to the
Supreme Court.

Issue:

Whether or not the CIR has jurisdiction over PHHC, a government owned and/or controlled
corporation performing governmental function.

Held:

The Court ruled that the Court of First Instance had jurisdiction over labor disputes involving GOCC
but not the performing governmental functions. Since the National Housing Association was created, the
Philippine government has carried mass housing and resettlement program to meet the needs of
Filipinos. The PHHC is governmental institution performing governmental functions. Thus, the Court
grant the petition and set aside the assailed resolution of the Court of CIR.