CALO VS.

FUERTES

EN BANC G.R. No. L-16537 June 29, 1962

FRANCISCO C. CALO, Petitioner-Appellant, vs. DELFIN C. FUERTES, DIRECTOR OF LANDS and SECRETARY OF AGRICULTURE AND NATURAL RESOURCES, respondents-appellees. PADILLA, J.:
chanro bles vi rtua l law lib ra ry

In Bureau of Lands Claim No. 224 (N), Lot No. 143-A, Cadastral Case No. 84, Butuan City entitled Francis C. Calo, claimant-contestant, vs. H.A. No. 86871 (E-40476) Delfin C. Fuertes, applicantrespondent, the Director of Lands rendered on 12 April 1956 an opinion denying a dismissing former's claim and contest against the Homestead Application No. 86871 (E-40476) of Delfin C. Fuertes, was ordering him to vacate the premises within sixty days from receipt of a copy of the opinion, and stating that upon finality thereof homestead patent would be issued to Delfin C. Fuertes. His request for reconsideration having been denied by the Director of Lands on 25 January 1957, Francisco C. Calo brought to the Secretary of Agriculture and Natural Resources the case, docketed as DANR case No. 1549. On 28 February 1958 the Secretary of Agriculture and Natural Resources modified the opinion of the Director of Lands . . . in the sense that Delfin C. Fuertes should reimburse Francisco C. Calo of the difference between the value of the improvements the latter introduced on the land in controversy and the value of the consequential benefits derived by him therefrom within thirty (30) days from advice by the Director of Lands who is hereby directed to determine the aforementioned difference within sixty (60) days from receipt of a copy of this decision. Still dissatisfied with the above opinion, Francisco C. Calo asked the Secretary of Agriculture and Natural Resources to reconsider it but the latter denied a reconsideration thereof. Hence, on 1 August 1958 Francisco C. Calo appealed to the President of the Philippines (Annex A Answer, p. 54, rec. of case No. 55), but on 8 August 1958 he withdrew it before the President of the Philippines could act thereon (Annex A to memorandum of the petitioner, p. 64, rec. of case No. 55).
chanrob lesvi rtua lawlib rary chan roble s virt ual law l ibra ry

On 22 August 1958 Francisco C. Calo filed in the Court of First Instance of Agusan a petition for writs of certiorari and prohibition with preliminary injunction praying that the enforcement of the opinions of the Director of Lands and the Secretary of Agriculture and Natural Resources be enjoined; that if a bond be needed for the purpose he was willing to file it; that after hearing the injunction be made final and permanent; that the respondent Delfin C. Fuertes pay him P18,000 as damages and attorney's fees and costs of the suit; that he be declared the owner entitled to possess the parcel of land subject of the litigation; and for any other just and equitable relief (special civil case No. 55).
chanro blesvi rtualaw lib rary c hanro bles vi rt ual law li bra ry

On 24 December 1958 the respondent Delfin C. Fuertes filed an answer and, on 27 December 1958, an amended answer to the petition; on 29 December 1958 and 3 January 1959 the respondent Secretary of Agriculture and Natural Resources and the Director of Lands, respectively, filed their answers. After a preliminary hearing as provided for in section 5, Rule 8, of the Rules of Court, on 31 July 1959 the court rendered judgment, the dispositive part of which is -

WHEREFORE, for failure to state a cause of action, for lack of jurisdiction and for not exhausting all the administrative remedies available to the petitioner in the ordinary course of law, the Court resolves to dismiss as it hereby dismisses the herein petition with costs against petitioner. The petitioner appealed, but as only a question of law is raised, the Court of Appeals certified the appeal to this Court.
chanro blesvi rt ualawlib ra ry chan roble s virtual law lib rary

This appeal has not been perfected within the reglementary period, as provided for in section 17, Rule 41, for although the notice of appeal was filed on 31 August 1959 (p. 77, record of case No. 55) or on the 13th day from the receipt of case No. 55) the appeal bond was filed on 18 September 1959 (p. 78, record of case No. 55) or on the 31st day after notice of judgment. This is enough to dispose of the case.
chan roblesv irt ualawli bra ry chan rob les vi rtual law lib rary

At any rate, the appellant's contention that, as the Secretary of Agriculture and Natural Resources is the alter ego of the President and his acts or decisions are also those of the latter, he need not appeal from the decision or opinion of the former to the latter, and that, such being the case, after he had appealed to the Secretary of Agriculture and Natural Resources from the decision or opinion of the Director of Lands he had exhausted all the administrative remedies, is untenable.
chanro blesvi rt ualawlib ra ry chan roble s virtual law lib rary

The withdrawal of the appeal taken to the President of the Philippines is tantamount to not appealing at all thereto. Such withdrawal is fatal, because the appeal to the President is the last step he should take in an administrative case.
chanro blesvi rtua lawlib rary chan roble s virtual law l ibra ry

Furthermore, a special civil action for certiorari and prohibition under Rule 67 of the Rules of Court lies only when "there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law." In the case at bar, appeal from an opinion or order by the Secretary of Agriculture and Natural Resources to the President of the Philippines is the plain, speedy and adequate remedy available to the petitioner.1
chanrobles vi rtua l law lib rary

The judgment appealed from already had become final and cannot be reviewed. The appeal is dismissed, with costs against the petitioner-appellant. Bengzon, C. J., Bautista Angelo, Labrador, Concepcion, Barrera, Paredes, Dizon, Regala and Makalintal, JJ., concur. Reyes, J.B.L., J., took no part. --> Endnotes:
1

Diego vs. Court of Appeals, et al., 54 OFF. Gaz. 956.

ABE-ABE VS. MANTA

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. L-4827 May 31, 1979 GERARDO D. ABE-ABE, FELICIANO MADRONA, LORETO VALDEHUEZA, MELECIO PEALOSA, PELAGIO BABIA, JUANITO TUMILAP, TIMOTEO CHAN, RICARDO BACOR, JESUS DORIA, VITELIANO DORIA, PABLO SIMITARA, VIRGILIO TARDE, POLICARPO RAGAS, EMILIANO EDULAN, DORICO LAGUNAY, FELICIANO MADRONA, JR., CARMEN L. BALBAS, SERVANDO TARDE, JOSE DAGONDON, ANGEL OCLARIT, ULDARICO BABIA, DIOGENES DIOLANTO, ARISTON BABAEL, LEONCIO DORIA, PLATON BACOR, LORETO DIZON, JORGE PAHILANGCO, JESUS BARLAAN, TELESFORO EDULAN, SEGUNDO JACULAN, ANTONIO BARCELONA, LORENZO SILAGAN, AGUSTIN PABELLORE, ISIDRO DAGOPLO, MAMERTO SIMITARA, CONRADO MAHINAY, BEN NUEZ, IGNACIA BABALCON, EPIFANIA ABE-ABE, DONATO LLOPEZ, ANGEL TORINO, HILARIO LLANASA, TRANQUILNO PURO, IYONG LASAY, INES MEJOC, ROQUE SABIDO, HOSPICIO LLOPEZ, BERNARDA ABE-ABE, JOSE LAGUNAY, MARCELA BABALCON, SEVERINO ABE-ABE, MAGDALENO BACOR, ROBERTO CHAN, ROBERTO BADANA, MACRINA P. ECOBEN, SERGIO DAYPUYAT, FAUSTINO DAGONDON, ALFREDO PAHILANGCO, ULPIANO OCLARIT, CORNELIO CABASAGAN, BONIFACIO DAGONDON, RUFO DALWAG, MIGUEL TARDE, CESARIO EDPAN, LUISA CHAN, IGNACIO PEALOZA, ALFONSO ARADO, ISAAC LABOR, TEOFILO LAWRETE, FRANCISCA BABAEL, MAXIMO HUERBANA, FELIX DAGUPLO, TEODORO DAGONDON, NEMESIO HONCULADA, PANCRASIO DAGONDON, ROBERTO ABADAJOS, BEN PAGA, RAMON RAGO, NARCISO SANCHEZ, IIGO DAGONDON, ISIDRO SIMITARA, BALBINO PABELLORE, CRESENCIO PABELLORE, DEDING PABELLORE, TUAN TIA, LEON LIGAN, FILOMENO GAMUTAN, EMILIANO BIWANG, CECILIO AWATIN, PEDRO GOMONIT, AVELINO TIRARIRAY, DODO GOMONIT, TEOGENES GOMONIT, FELIMON PABELLORE, DOMINGO IGNILAN, MARIO PABELLORE, ROSA IPANAG, ALFREDO BABAYRAN, VICENTE EXCHAURE, AMBROSIO OCLARIT, MELECIO PUTOL, ARTEMIO GUIRITAN, JUSTINIANO DAGONDON, PATERSON BACLAYO, LAURO DAGONDON, EUGENIO TAGOD, LAZARO DAGONDON, JAIME DAGONDON, ANSELMO ABIAN, IRENEO INGUITO, JOSE GAERLAN, CATALINO JARDIN, CORAZON CALUB, PEDRO BAJAO, FELIPE UPPOS, SOLEDAD NERY, FELIPE JARDIN, PLACIDO JARDIN, CONSTANCIO AGBU, CANDELARIO LADIO, EDUARDO JARDIN, URSULA DAGUPLO, MATIAS DAGUPLO, ISABELA NOGUERA, DEMOCRITO APARTE, APOLONIA CIMACIO, VICENTE TAJALE, FEDERICO RAGO, ALBERTO ESTANILLA, RUFINO LAGRIA, GERONIMO RAGAS, EMILIANO SONGCO, EPIFANIO NOGUERA, FELOMINO BACOR, NICOLASA DAGONDON, LUISITO DAGONDON and SALVADOR CORRALES,petitioners, vs. JUDGE LUIS D. MANTA of the Court of First Instance of Camiguin and PEDRO P. ROMUALDO,respondents. Pedro R. Luspo, Jr. for petitioners. P. P. Romualdo for respondent.

AQUINO, J.:

The legal issue in this case is whether the Court of First Instance of Camiguin has jurisdiction to adjudicate a dispute over water rights for irrigation purposes even if the controversy has not yet been passed upon by the National Water Resources Council the agency vested with original and exclusive competence to resolve conflicting c on the appropriation of water resources. On August 20, 1976, the one hundred thirty-seven petitioners (farmers and owners of ricelands) filed an injunction suit in the Camiguin court against Pedro P. Romualdo (a lawyer and delegate to the 1971 Constitutional Convention). The purpose of the suit was to secure a judicial declaration as to the petitioners' prior vested rights under article 504 of the Civil Code to use the water of the Anibungan Inobo Ablay and Tajong Crocks to irrigate their ricelands located upstream in Barrios Lumad and Baylao Mambajao, Camiguin The petitioners sought to enjoin Romualdo from using the water of the creeks at night to irrigate his two. hectare riceland located downstream. That nocturnal use was allegedly prejudicial to the petitioners. Their version is that their use of the water of the creeks started in 1938; that in 1952 or after the volcanic eruption, the waters of the creeks were made to converge in a single channel and two diversion dams were constructed with the help of the municipal government and the Presidential Arm on Community Development PACD The National Irrigation Administration allegedly contributed money for the improvement of the dams. The petitioners wanted to convey the impression that the communal irrigation system was established primarily for the benefit of the ricelands located upstream. In July, 1976, respondent or defendant Romualdo started using the water of the creeks by opening the diversion dams at night. That act provoked the filing of the injunction suit already mentioned. Romualdo's version in his answer is that at a conference held on July 29, 1976 among the petitioners (with their counsel), the provincial commander, the district engineer, the mayor, the members of the Sangguniang Bayan and Romualdo, it was agreed upon that the water of the creeks would be used on a rotation basis: the petitioners would use it in the daytime and Romualdo and the other landowners downstream would use the water at night. The opening and closing of the dam would be under the control of the provincial commander. Romualdo alleged that on June 21, 1976 he filed a water permit application with the district engineer's office as required in Presidential Decree No. 424 so that he could use legitimately the water to irrigate his riceland locateddownstream near the seashore in Sitio Boloc-Boloc. The regional director of the Bureau of Public Works issued to Romualdo on October 5, 1976 a temporary authority to use the water of the creeks. In contrast, the petitioners did not file any water permit applications although required to do so by the district engineer's office. Romualdo interposed the defense that the lower court had no jurisdiction over the subject matter of the suit. He contended that the petitioners' remedy was to file their complaint with the district engineer's office pursuant to Department Order No. 245 dated September 29, 1958 of the Undersecretary of Public Works and Communications regarding the determination of water rights controversies. Romualdo also invoked Presidential Decree No. 424, which took effect on March 28, 1974 and which created the National Water Resources Council (to replace the Water Resources Committee) and vested it with powers to coordinate and integrate water resources development activities or, according to its section 2, to "determine, adjudicate, and grant water rights" (70 0. G. 2912). Romualdo argued that Presidential Decree No. 424 repealed article 504 of the Civil Code which allows the acquisition of the use of public waters by prescription for ten years Article 504 is the statutory basis of petitioners' alleged preferential water rights.

After the lower court found that on January 14, 1977 Romualdo's temporarily permit to use the water of the communal irrigation system was cancelled, as directed by the executive director of the National Water Resources Council, it issued on February 11, 1977 an order enjoining Romualdo from diverting the water of the creeks to his two-hectare farm. In the meantime, the Water Code of the Philippines or Presidential Decree No. 1067 was promulgated on December 31, 1976 (730. G. 3554). Romualdo urged the trial court to dismiss the injunction suit on the ground of lack of jurisdiction because the controversy should first be passed upon by the National Water Resources Council, as allegedly required under Presidential Decree No. 424 and under the following provisions of the Water Code which confer original jurisdiction upon the Council to decide controversies on water rights and which vest appellate jurisdiction in the Court of First Instance to review the Council's decisions: ART. 88. The Councils half have original jurisdiction over all disputes relating to appropriation, utilization exploitation, development, control conservation and protection of waters within the meaning and context of the provisions of this Code. The decisions of the Council on water rights controversies shall be immediately executory and the enforcement thereof may be suspended only when a bond, in an amount fixed by the Council to answer for damages occasioned by the suspension or stay of execution, shall have been filed by the Appealing party, unless the suspension is by virtue of an order of a competent court. All disputes shall be decided within sixty (60) days after the parties submit the same for decision or resolution. The Council shall have the power to issue writs of execution and enforce its decisions with the assistance of local or national police agencies. ART. 89. The decisions of the Council on water rights controversies may be appealed to the Court of First instance of the province where the subject matter of the controversy is situated within fifteen (15) days from the date the party appeal receives a copy of the decision on any of the following grounds: (1) grave abuse of discretion; (2) question of law; and (3) questions of fact and law. For lack of jurisdiction and for non-exhaustion of administrative remedies, the lower court dismissed the case in its order of July 18, 1977. Instead of Appealing that order of dismiss to this Court, as prescribed in Republic Act No. 5440, the petitioners filed a petition for certiorari in the Court of Appeals which dismissed the petition because the issuance of the writ of certiorari would not be in aid of its appellate jurisdiction Abe-Abe vs. Judge Manta, CA-G. R. No. SP07103-R, March 31, 1978). On August 19, 1978, the same 137 petitioners filed the instant certiorari case for the belated review of the lower court's order of dismissal . We hold that the petition is devoid of merit. It is incontestable that the petitioners' immediate recourse is to ventilate their grievance with the National Water Resources Council which, as already noted, is the administrative agency exclusively vested with original jurisdiction to settle water rights disputes-under the Water Code and under Presidential Decree No. 424. That jurisdiction of the Council under section 2(b) of Presidential Decree No. 424 is reaffirmed in section 88 of the Water Code and in section 3(d) thereof which provides that the utilization, exploitation, development, conservation and protection of water resources shall be subject to the control and regulation of the government through" the Council.

It should be noted that article 100 of the Water Code repealed the provisions of the Civil Code and the Spanish Law of Waters of August 3, 1866 "on ownership of waters, easements relating to waters, use of public waters and acquisitive prescription on the use of waters, which are inconsistent with the provisions of the Water Code. Article 100 also repealed the Irrigation Law, Act No. 2152. It is also noteworthy that section 3(e) of the Water Code recognizes that "preference in the use and development of waters shall consider current usages and be responsive to the changing needs of the country". Article 95 of the Water Code recognizes vested rights but requires that such rights should be registered on or before December 31, 1978. The Code in its article 20 acknowledges that "the measure and t of appropriation of water shall be beneficial use", a rule found in the Philippine Bill of 1902 (See Sideco vs Sarenas 41 Phil. 80, 82-83). The Code assumes that it is more expeditious and pragmatic to entrust to an administrative agency the settlement of water rights disputes rather than require the claimants to go directly to the court where the proceedings are subject to unavoidable delays which are detrimental to the parties. It is patent that the petitioners did not exhaust their administrative remedy. Their complaint should have been lodged with the National Water Resources Council whose decision is reviewable by the Court of First Instance as indicated in the aforequoted sections 88 and 89 of the Water Code. If a litigant goes to court without first pursuing his administrative remedies, his action is premature or he has no cause of action to ventilate in court. His case is not ripe for judicial determination (Aboitiz & Co., Inc. vs. Collector of Customs, L-29466, May 18, 1978, 83 SCRA 265, 271). "When an adequate remedy may be had within the Executive Department of the government, but nevertheless, a litigant fails or refuses to avail himself of the same, the judiciary shall decline to interfere This traditional attitude of the courts is based not only on conveyance but likewise on respect: convenience of the party litigants and respect for a co equal office in the goverment If a remedy is available within the administrative machinery, this should be resorted to before resort can be made to (the) courts." (Cruz vs. Del Rosario, 119 Phil. 63, 66.) The rule on exhaustion of administrative remedies before resorting to the court means that there should be an "orderly procedure which favors a pre administrative sifting process, particularly with respect to matters peculiarly within the competence of the administrative agency, avoidance of in. interference with functions of the administrative agency by withholding judicial action until the administrative process has run its course, and prevention of attempts 'to swamp the courts by a resort to them in the first instance'" (2 Am Jur 2nd 428; Antonio vs. Tanco, Jr., L-38135, July 25, 1975, 65 SCRA 448, 454). WHEREFORE, the petition is dismissed with costs against the petitioners. SO ORDERED. Fernando (Actg. C.J.), Antonio, Santos and Abad Santos, JJ., concur. Barredo and Concepcion, Jr., JJ., are abroad.

ANTONIO VS. TANCO

Republic of the Philippines SUPREME COURT Manila

EN BANC

DECISION

July 25, 1975 G.R. No. L-38135 HILARIO C. ANTONIO, petitioner, vs. HON. ARTURO R. TANCO, JR., in his official capacity as Secretary of Agriculture and Natural Resources, substituted for by HON. JOSE LEIDO, JR., in his capacity as Secretary of Natural Resources; FELIX R. GONZALES, in his official capacity as Director of Fisheries, and HON. MANUEL DELIMA, in his official capacity as the person acting as Regional Director of Region IV of the Bureau of Fisheries, respondents. Rogelio R. Udarbe for petitioner. Office of the Solicitor General Estelito E. Mendoza, Assistant Solicitor General Octavio R. Ramirez and Solicitor Nathaneal P. de Pano, Jr. for respondents. Aquino, J.: On September 5, 1973 the Secretary of Agriculture and Natural Resources, pursuant to Presidential Decree No. 6, which amended certain rules on discipline of government employees (68 O. G. 7971), and upon the recommendation of the Acting Director of Fisheries, charged Hilario C. Antonio, the Regional Director of Regional Office No. IV of the Bureau of Fisheries, with incompetence and conduct highly prejudicial to the best interest of the service. The complaint was embodied in a "formal charge with order of suspension" which was served upon Antonio on September 14, 1973. The suspension took effect immediately. In that indictment it was alleged that Antonio on May 31, October 31 and November 30, 1972 issued to eleven persons closely related to, or associated with, each other twelve seaweed permits covering the whole seaweed areas of Manila Bay despite his knowledge that the official policy was that no exclusive rights over the whole seaweed areas in Manila should be awarded under exclusive seaweed licenses. It was further charged that Antonio on May 24, 1973 became a witness for the said eleven permitees, who had filed a case in the Court of First Instance of Rizal against Antonio and the Acting Director of Fisheries, so, that in effect Antonio testified against himself. Other glaring inconsistencies committed by Antonio were recited in the complaint.

Antonio through counsel filed an answer which was not under oath. He justified the issuance of the seaweed permits by citing Fisheries Administrative Orders Nos. 45 and 45-1, which require permits for gathering seaweeds, and by invoking a precedent established by Acting Director Felix Gonzales, who, when he was Supervising Fishery Technologist, issued a seaweed permit to Francisco Hilvano for the Manila Bay area. Some weeks after his suspension, or on October 24, 1973, Antonio sent the following telegraphic request for reinstatement to the President of the Philippines (capitalization supplied): His Excellency President Ferdinand Marcos Malacaang, Manila Requesting His Excellency my immediate reinstatement as Fisheries Regional Director Region IV. Arbitrarily suspended indefinitely without investigation before suspension by Secretary Tanco since September 14 for implementing existing fisheries laws and Presidential Decree 43, section 6B, paragraph 5, regarding issuance seaweeds permits, Manila Bay area. Secretary Tanco for free seaweeds gathering without first amending seaweeds laws. Present seaweeds controversy caused filing injunction case due to suspended permit with Pasig CFI Judge Navarro, preliminary hearing anti-graft practices Fiscal Puno, Manila, deportation proceeding against Chinese seaweeds dealer and administrative charges incompetency and ignorance of law against Acting Fisheries Director. Referring His Excellency to Secretary Raquiza (for) more information. HILARTO ANTONIO Regional Director The Assistant Executive Secretary referred the foregoing telegram to Secretary Tanco on December 18, 1973 for appropriate action or comment. Secretary Tanco on April 17, 1974 informed the Assistant Executive Secretary that: Hilario Antonio stands charged by the undersigned for: (1) incompetence in the performance of official duties, and (2) conduct highly prejudicial to the best interest of the service, and is presently suspended while case is being heard by the DANR Special Committee on Investigation chaired by Fiscal Ramon Tuason of the Department of Justice. Enclosed are the comprehensive comments and recommendations of the Acting Director of the Bureau of Fisheries, Felix R. Gonzales, to which we fully concur, containing the facts and circumstances resulting in the formal charge with order of suspension dated September 5, 1973.... It is our considered opinion and recommendation that Mr. Antonio's appeal to the President for reinstatement should be denied.

Up to this time no final action has been taken on Antonio's request for reinstatement and on the Secretary's recommendation. On November 16, 1973 or sixty-three days after his suspension, Antonio informed the Director of Fisheries that by virtue of section 35 of the Civil Service Law he was going to return to duty as Regional Fishery Director. The Secretary in his reply of November 21, 1973 informed Antonio that his reinstatement could not be given due course under Presidential Decree No. 6 and that the charge against him was serious and the evidence of guilt was strong MdCS. On January 29, 1974 Antonio, without awaiting the decision of the President on his request for reinstatement, ventilated his grievance in the judicial forum by filing the instant petition for mandamus, quo warranto and prohibition against the Secretary, the Director of Fisheries and Manuel Delima who was designated to take Antonio's place as Regional Director for Region IV. The Solicitor General, in behalf of respondent officials, has advanced the contention that mandamus would not lie in this case because under Presidential Decree No. 6 and Letter of Instruction No. 14-A a respondent in an administrative case may be summarily dismissed or suspended. He opines that those martial law measures rendered inoperative the legal provision that a suspended employee should be reinstated after the expiration of sixty days from the date of his suspension. He argues that the suspended employee can be reinstated only after he is exonerated and that, therefore, he can remain under suspension indefinitely. For that reason, he concludes that Antonio has no cause of action for mandamus. The respondents also contend that Antonio has no cause of action for quo warranto because in 1964 Antonio was appointed Regional Director without a specification in his appointment of any region or district. He was assigned to Region IV. The Solicitor General argues that Antonio's suspension does not mean that he ceased to be a Regional Director. His assignment to Region IV was simply revoked. Delima did not usurp Antonio's position as Regional Director. The respondents point out that Antonio has no cause of action for prohibition because the law empowers the Secretary to initiate the filing of charges against his erring subordinates and to refer the charges to the proper agency for investigation. In Antonio's case, a committee of the Department of Agriculture and Natural Resources was assigned to investigate the charges about him. As the Secretary and the investigating committee have jurisdiction over Antonio's case, the investigation cannot be enjoined. The respondents further contend that Antonio's instant actions were premature because, as already noted, his telegraphic request to the President for reinstatement was referred to the Secretary who on April 17, 1974 recommended that Antonio's appeal for reinstatement should be denied. The respondents assume that Antonio should have awaited the Presidential action on his request for reinstatement before going to court.

On August 28, 1974 the investigating committee submitted its report to Secretary Arturo R. Tanco, Jr. In view of the creation of the Department of Natural Resources, headed by Jose Leido, Jr., that report presumably was referred to the new Secretary. At this writing Secretary Leido has not yet decided Antonio's case. The issue is whether Antonio is entitled to the writ of mandamus to compel the Secretary of Natural Resources to reinstate him, it appearing that his suspension has lasted for more than twenty-one months, and, under section 35 of the Civil Service Law, as applied in Garcia vs. Executive Secretary, L-19748, September 13, 1962, 6 SCRA 1, when the administrative case against an employee under preventive suspension is not finally decided within sixty days after the date of the suspension, the respondent should be reinstated in the service. The quo warrantoand prohibition aspects of Antonio's petition are of no moment. We are of the opinion that the mandamus action was prematurely filed, or, as the respondents put it, the case is not yet ripe for adjudication in a court of justice in view of the pendency in the Office of the President of Antonio's request for reinstatement. As long as that request is pending, the matter of his reinstatement is not justiciable. A mandamus action against administrative officers should not be entertained if their superiors can grant relief (Ang Tuan Kai & Co. vs. Import Control Commission, 91 Phil. 143; Resolution in Subido vs. Sarmiento, L-5322, December 14, 1951; 3 Moran's Comments on the Rules of Court, 1970 Ed., p. 196). A mandamus action against the Director of Private Schools was dismissed because the matter involved in the case was still pending before the Secretary of Education. (Peralta vs. Salcedo, 101 Phil. 452. See Dajo vs. Padilla, 63 O. G. 3579). Parties asking for a judicial review of administrative official action must first exhaust their remedies in the executive branch (Mandrian vs. Sinco, 110 Phil. 160; Gonzales vs. Provincial Auditor of Iloilo, L-20568, December 28, 1964, 12 SCRA 711; Garcia vs. Teehankee, L-29113, April 18, 1969, 27 SCRA, 937). The purpose behind the policy of requiring a party to first exhaust all administrative remedies before resorting to the court is to provide "an orderly procedure which favors a preliminary administrative sifting process, particularly with respect to matters peculiarly within the competence of the administrative authority" (42 Am. Jur. 581 cited in Santiago vs. Cruz, 98 Phil. 168, 173). Where, as in this case, the President might be able to grant the remedy sought by the petitioner, reasons of comity and orderly procedure demand that his decision be awaited before resort to the courts can be had (Montes vs. Civil Service Board of Appeals, 101 Phil. 490, 493). "When an adequate remedy may be had within the Executive Department of the government but nevertheless a litigant fails or refuses to avail himself of the same, the judiciary shall decline to interfere. This traditional attitude of the courts is based not only on convenience but likewise on respect: convenience of the party litigants and respect for a co-equal office in the government. If a remedy is available within the administrative machinery, this should be resorted to before resort can be made to the courts, not only

to give the administrative agency opportunity to decide the matter by itself correctly but also to prevent unnecessary and premature resort to" (the)courts (Cruz vs. Del Rosario, L-17440, December 26, 1963, 9 SCRA 755, 758). As correctly observed by the Solicitor General, Antonio, by requesting the President to revoke Secretary Tanco's suspension order, precluded judicial intervention in his case while his request is pending consideration (Compare with Kordovez vs. Carmona, L21473, October 31, 1967, 21 SCRA 678 and Romero vs. Municipal Mayor of Baljoon, Cebu, L-22062, March 29, 1968, 22 SCRA 1374, where the petition for reinstatement after the expiration of the sixty-day period was denied because the petitioners had contributed to the delay in the disposition of their administrative cases by appealing to the Commissioner of Civil Service) IrVvc0. WHEREFORE, the petition is dismissed with costs against the petitioner. SO ORDERED Xj9rlJ. Makalintal, C.J., Castro, Fernando, Makasiar, Antonio, Muoz Palma, Concepcion Jr. and Martin, concur. Teehankee, J., took no part.

Separate Opinions

BARREDO, J., concurring: I concur, but, to my mind, the more correct basis for dismissing the instant petition is failure to state a cause of action or, in fact, obviously indubitable lack of merit thereof, rather than prematurity. I am not for leaving any suggestion no matter how remote that in the event the President should act unfavorably on petitioner's telegram-request for reinstatement, he would have any ground to seek judicial remedy. He has come to Us not because respondent Secretary has gravely abused his discretion in suspending him but because the period of such (preventive) suspension has already exceeded the 60day limit fixed by Section 35 of the Civil Service Law which this Court held to be mandatory in Garcia vs. Executive Secretary, 6 SCRA 1. In other words, the only issue for Our resolution is whether or not Presidential Decree No. 6, has repealed, as contended by the Solicitor General, the procedure in administrative cases prescribed by the Civil Service Law, including said Section 35. In this respect, there is no doubt in my mind that the Solicitor General's contention is well taken. It is thus clear to me that even if the President should deny his telegraphic request, petitioner would not be entitled to reinstatement by judicial order, as there could be no legal basis for such a relief.

Presidential Decree No. 6 pertinently provides as follows: WHEREAS, under Presidential Decree No. 1, dated September 23, 1972, the Integrated Reorganization Plan was adopted and made part of the law of the land; WHEREAS, in the reorganization of the Government, it is necessary that we clean the public service of undesirable officials and employees; and WHEREAS, it is essential that administrative cases against such officials and employees be disposed of in the most expeditious manner; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution as Commander-in-Chief of all the Armed Forces of the Philippines, and pursuant to Proclamation No. 1081, dated September 21, 1972, and General Order No. 1, dated September 22, 1972, do hereby promulgate the following amendatory rules on the administrative discipline of government officials and employees: SECTION 1. Grounds for disciplinary action. The following shall be grounds for disciplinary action: xxx xxx xxx h. Inefficiency and incompetence in the performance of official duties. xxx xxx xxx aa. Conduct prejudicial to the best interest of the service. xxx xxx xxx SECTION 2. Disciplinary jurisdiction. The Department Head shall have authority to remove, separate, suspend and otherwise discipline officers and employees under their jurisdiction, except presidential appointees. Their decisions shall be final, except in the case of removal. In case the penalty imposed is removal, the respondent may appeal the decision to the Civil Service Commission. An appeal shall not stop the decision from being executory, and in the event that the respondent wins on appeal, he shall be considered as having been under suspension during the pendency of the appeal. Chiefs of bureaus and offices shall investigate and decide administrative complaints against employee under their jurisdiction. Their decision shall be final if the penalty imposed is suspension without pay for not more than 30 days or fine of not more than 30 days' salary. If the penalty imposed is higher, the decision may be appealed to the Department Head, and pending appeal, the same shall be executory except when the penalty is removal. An investigation may be entrusted to regional directors or similar officials who shall make the necessary report and recommendation to the chief of bureau or office within five (5) days from termination of the investigation which shall be finished within ten (10) days.

SEC. 3. Summary proceedings. No formal investigation is necessary and the respondent may be immediately removed or dismissed if any of the following circumstances is present: a. When the charge is serious and the evidence of guilt is strong. b. When the respondent is a recidivist or has been repeatedly charged, and there is reasonable ground to believe that he is guilty of the present charge. c. When the respondent is notoriously undesirable. SEC. 4. Repealing clause Any provision of existing laws, rules and regulations in conflict with this Decree are hereby modified or repealed accordingly 8iS4n. Having been issued on September 27, 1972, before the ratification of the present Constitution, this decree has become part of the law of the land. Without discussing in this case, because it is not necessary to do so, whether or not said decree has acquired constitutional status, and assuming it has no more than the character of a legislative enactment, there can be no question that it could validly repeal, as it does expressly repeal, all existing laws in conflict therewith, and this includes Section 35 of the Civil Service Law, which by no means is of any constitutional level mjcQ. The complete overhaul of the system of administrative investigations relative to personnel discipline of public officers and employees is readily evident from a cursory reading of Presidential Decree No. 6. It has made the procedure thereof drastically summary, doing away with the time-consuming, elaborate and multi-stepped investigation outlined in Section 32 to 37 of the Civil Service Law and the implementing Civil Service Rules, particularly those found in Rule XVIII thereof, more specifically Sections 22 to 33. I cannot reconcile the apparent intent of the decree to expedite such investigations with the theory seemingly relied upon by petitioner that his preventive suspension should be deemed limited to only sixty (60) days. In respondent Secretary's reply, dated November 21, 1973, to petitioner's manifestation of November 16, 1971 that he would return to duty, petitioner was informed that the charge against him is serious and the evidence of guilt is strong. Upon this predicate, the Secretary could have even immediately removed or dismissed him by virtue of the power conferred upon him by aforequoted Section 3 read together with Section 2 of the decree, which if it had been done, would have rendered the issue being raised here futile, since in the event of exoneration even after removal immediately executed, he would be considered only as under preventive suspension. After all, preventive suspension is practically inherent in every disciplinary action when demanded by the circumstances thereof in the public interest. As was aptly held in Nera v. Garcia, 106 Phil. 1031: . In connection with the suspension of petitioner before he could file his answer to the administrative complaint, suffice it to say that the suspension was nota punishment or penalty for the acts of dishonesty and misconduct in office, but only as a preventive measure. Suspension is a preliminary step in an administrative investigation. If after such investigation, the charges are established and the person investigated is found

guilty of acts warranting his removal, then he is removed or dismissed. This is the penalty. There is, therefore, nothing improper in suspending an officer pending his investigation and before the charges against him are heard and be given an opportunity to prove his innocence. And then in Bautista vs. Peralta, 18 SCRA 223, the Supreme Court added: "Preventive suspension in administrative cases is not a penalty in itself. It is designed merely as a measure of precaution so that the employee who is charged may be separated, for obvious reasons, from the scene of his alleged malfeasance while the same is being investigated. (at p. 825.) It should be borne in mind that Presidential Decree No. 6 is a follow-up of Presidential Decree No. 1 providing for the integrated reorganization of the executive branch of the national government and is designed to expedite the cleaning of the public service of undesirable officials and employees. Any happenstance which may cause any hindrance or delay in the accomplishment of such objective infringes the spirit of said decrees and should be treated as legally untenable. It is now history that this Court has not found any constitutional infirmity in Proclamation 1081 which placed the Philippines under martial law. We have also considered it to be constitutionally permissible that the existing martial law administration utilize its broad powers for the purpose of instituting reforms tended to prevent the recurrence of the causes that brought martial law forth. Indeed, to my mind, the power to reorganize the government and maintain one in such form as would best promote the purposes for which the proclamation has been issued is probably among the first inherent prerogatives of the martial law administrator. Such being the case, I cannot perceive any legally valid objection to the drastic modification of the procedure for personnel discipline in the civil service ordered by the President in the decrees. Accordingly, until the formal declaration by the President of the lifting of martial law, the employees and officials of the government have to resign themselves to the fact that it is Presidential Decree No. 6, together with Letters of Instruction Nos. 14 and 14-A, that constitute the civil service law of the Philippines insofar as personnel discipline is concerned dSFyXWwf. I vote to dismiss the petition.

Separate Opinions BARREDO, J., concurring: I concur, but, to my mind, the more correct basis for dismissing the instant petition is failure to state a cause of action or, in fact, obviously indubitable lack of merit thereof, rather than prematurity. I am not for leaving any suggestion no matter how remote that in the event the President should act unfavorably on petitioner's telegram-request for reinstatement, he would have any ground to seek judicial remedy. He has come to Us not because respondent Secretary has gravely abused his discretion in suspending him but because the period of such (preventive) suspension has already exceeded the 60day limit fixed by Section 35 of the Civil Service Law which this Court held to be mandatory in Garcia vs. Executive Secretary, 6 SCRA 1. In other words, the only issue

for Our resolution is whether or not Presidential Decree No. 6, has repealed, as contended by the Solicitor General, the procedure in administrative cases prescribed by the Civil Service Law, including said Section 35. In this respect, there is no doubt in my mind that the Solicitor General's contention is well taken. It is thus clear to me that even if the President should deny his telegraphic request, petitioner would not be entitled to reinstatement by judicial order, as there could be no legal basis for such a relief zkYLbTGqPH. Presidential Decree No. 6 pertinently provides as follows: WHEREAS, under Presidential Decree No. 1, dated September 23, 1972, the Integrated Reorganization Plan was adopted and made part of the law of the land; WHEREAS, in the reorganization of the Government, it is necessary that we clean the public service of undesirable officials and employees; and WHEREAS, it is essential that administrative cases against such officials and employees be disposed of in the most expeditious manner; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution as Commander-in-Chief of all the Armed Forces of the Philippines, and pursuant to Proclamation No. 1081, dated September 21, 1972, and General Order No. 1, dated September 22, 1972, do hereby promulgate the following amendatory rules on the administrative discipline of government officials and employees: SECTION 1. Grounds for disciplinary action. The following shall be grounds for disciplinary action: xxx xxx xxx h. Inefficiency and incompetence in the performance of official duties. xxx xxx xxx aa. Conduct prejudicial to the best interest of the service. xxx xxx xxx SECTION 2. Disciplinary jurisdiction. The Department Head shall have authority to remove, separate, suspend and otherwise discipline officers and employees under their jurisdiction, except presidential appointees. Their decisions shall be final, except in the case of removal. In case the penalty imposed is removal, the respondent may appeal the decision to the Civil Service Commission. An appeal shall not stop the decision from being executory, and in the event that the respondent wins on appeal, he shall be considered as having been under suspension during the pendency of the appeal. Chiefs of bureaus and offices shall investigate and decide administrative complaints against employee under their jurisdiction. Their decision shall be final if the penalty imposed is suspension without pay for not more than 30 days or fine of not more than

30 days' salary. If the penalty imposed is higher, the decision may be appealed to the Department Head, and pending appeal, the same shall be executory except when the penalty is removal. An investigation may be entrusted to regional directors or similar officials who shall make the necessary report and recommendation to the chief of bureau or office within five (5) days from termination of the investigation which shall be finished within ten (10) days 0I5bTV. SEC. 3. Summary proceedings. No formal investigation is necessary and the respondent may be immediately removed or dismissed if any of the following circumstances is present: a. When the charge is serious and the evidence of guilt is strong. b. When the respondent is a recidivist or has been repeatedly charged, and there is reasonable ground to believe that he is guilty of the present charge. c. When the respondent is notoriously undesirable. SEC. 4. Repealing clause Any provision of existing laws, rules and regulations in conflict with this Decree are hereby modified or repealed accordingly ujQFbk7. Having been issued on September 27, 1972, before the ratification of the present Constitution, this decree has become part of the law of the land. Without discussing in this case, because it is not necessary to do so, whether or not said decree has acquired constitutional status, and assuming it has no more than the character of a legislative enactment, there can be no question that it could validly repeal, as it does expressly repeal, all existing laws in conflict therewith, and this includes Section 35 of the Civil Service Law, which by no means is of any constitutional level. The complete overhaul of the system of administrative investigations relative to personnel discipline of public officers and employees is readily evident from a cursory reading of Presidential Decree No. 6. It has made the procedure thereof drastically summary, doing away with the time-consuming, elaborate and multi-stepped investigation outlined in Section 32 to 37 of the Civil Service Law and the implementing Civil Service Rules, particularly those found in Rule XVIII thereof, more specifically Sections 22 to 33. I cannot reconcile the apparent intent of the decree to expedite such investigations with the theory seemingly relied upon by petitioner that his preventive suspension should be deemed limited to only sixty (60) days. In respondent Secretary's reply, dated November 21, 1973, to petitioner's manifestation of November 16, 1971 that he would return to duty, petitioner was informed that the charge against him is serious and the evidence of guilt is strong. Upon this predicate, the Secretary could have even immediately removed or dismissed him by virtue of the power conferred upon him by aforequoted Section 3 read together with Section 2 of the decree, which if it had been done, would have rendered the issue being raised here futile, since in the event of exoneration even after removal immediately executed, he would be considered only as under preventive suspension. After all, preventive suspension is practically inherent in every disciplinary action when

demanded by the circumstances thereof in the public interest. As was aptly held in Nera v. Garcia, 106 Phil. 1031: . In connection with the suspension of petitioner before he could file his answer to the administrative complaint, suffice it to say that the suspension was nota punishment or penalty for the acts of dishonesty and misconduct in office, but only as a preventive measure. Suspension is a preliminary step in an administrative investigation. If after such investigation, the charges are established and the person investigated is found guilty of acts warranting his removal, then he is removed or dismissed. This is the penalty. There is, therefore, nothing improper in suspending an officer pending his investigation and before the charges against him are heard and be given an opportunity to prove his innocence. And then in Bautista vs. Peralta, 18 SCRA 223, the Supreme Court added: "Preventive suspension in administrative cases is not a penalty in itself. It is designed merely as a measure of precaution so that the employee who is charged may be separated, for obvious reasons, from the scene of his alleged malfeasance while the same is being investigated. (at p. 825.) It should be borne in mind that Presidential Decree No. 6 is a follow-up of Presidential Decree No. 1 providing for the integrated reorganization of the executive branch of the national government and is designed to expedite the cleaning of the public service of undesirable officials and employees. Any happenstance which may cause any hindrance or delay in the accomplishment of such objective infringes the spirit of said decrees and should be treated as legally untenable. It is now history that this Court has not found any constitutional infirmity in Proclamation 1081 which placed the Philippines under martial law. We have also considered it to be constitutionally permissible that the existing martial law administration utilize its broad powers for the purpose of instituting reforms tended to prevent the recurrence of the causes that brought martial law forth. Indeed, to my mind, the power to reorganize the government and maintain one in such form as would best promote the purposes for which the proclamation has been issued is probably among the first inherent prerogatives of the martial law administrator. Such being the case, I cannot perceive any legally valid objection to the drastic modification of the procedure for personnel discipline in the civil service ordered by the President in the decrees. Accordingly, until the formal declaration by the President of the lifting of martial law, the employees and officials of the government have to resign themselves to the fact that it is Presidential Decree No. 6, together with Letters of Instruction Nos. 14 and 14-A, that constitute the civil service law of the Philippines insofar as personnel discipline is concerned. I vote to dismiss the petition. .

DELOS SANTOS VS. LIMBAGA

Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-15976 January 31, 1962

APOLONIO DE LOS SANTOS, plaintiff-appellant, vs. BENJAMIN V. LIMBAGA, defendant-appellee. T. de los Santos for plaintiff-appellant. Office of the Solicitor General and G. S. de la Pea for defendant-appellee. DE LEON, J.: This an appeal from an order of the Court of First Instance of Basilan City dismissing a petition for mandamus to compel Benjamin V. Limbaga, the engineer of that city, to authorize Apolonio de los Santos to construct a residential house on the land described in the petition.. It is alleged in the petition that on November 19, 1952, Apolonio de los Santos applied with the respondent city engineer for a permit to construct a residential house on his land situated in Lamitan, Basilan City; that the respondent without any lawful cause refused to grant said permit; and that in view of this refusal, petitioner suffered damages in the amount of P18,000.00. In his answer, the respondent, represented by the City Fiscal of Basilan, denied the allegations of the petition and interposed the following affirmative defenses: that after a fire which occurred in Lamitan that razed down a major portion of the market site therein, the city government approved the purchase of an additional area to enlarge the said site and that, incidentally, the lot claimed by the petitioner was included in the area; that by virtue thereof, expropriation proceedings had been instituted thereon, hence, the denial of the permit applied for by petitioner.
1w ph1.t

On December 5, 1958, the city fiscal moved to dismiss the petition on the following grounds: that mandamus will not lie since the issuance of the permit applied for was a discretionary and not a ministerial duty on the part of the city engineer; that petitioner's application for a permit to construct a residential building, of strong material, on the lot in question had to be denied by the city engineer for the lot was within the area of the proposed market site which was already under expropriation proceedings instituted by Basilan City pursuant to a resolution approved by the City Council; and in view of the fact that on March 24, 1958, while this case was pending, petitioner filed an application in the name of another person (Marcial Quilaton) to construct a temporary movable store on the same site in question, which was approved and thereafter a mobile store was actually constructed thereon and consequently, petitioner is deemed to have abandoned his application to construct the building of strong material and necessarily the remedy of mandamus being sought by petitioner had lost its merit. On March 11, 1959, the trial court issued an order of dismissal based on the following grounds: that mandamus could not be granted as it was not a ministerial duty on the part of the city engineer to approve petitioner's application for construction of buildings but approval of the same needed sound discretion in the said engineer's exercise of his official functions; and that the site in question, which petitioner wanted for the construction of a building as per his application, has already been utilized by him for the construction of another building which now exists thereon an act which purports of an abandonment of his petition for mandamus.

From the order of dismissal, petitioner has appealed direct to this Court raising only questions of law. Without touching on the various issues raised, We would say that mandamus cannot prosper in this case for the simple reason that, as the record shows, the land in question is already the subject matter of expropriation proceeding instituted by Basilan City pursuant to a resolution approved by the City Council, which proceeding is now pending in the Court of First Instance of Basilan. Moreover, herein petitioner has failed to exhaust the administrative remedies available to him. Petitioner should have first brought the matter to the Director of Public Works who, under the law, exercises supervision and control over city engineers of chartered cities (see Commonwealth Act No. 424), and if he was not satisfied with the Director's decision he should have appealed to the Secretary of Public Works and Communications. Miguel v. Reyes, G. R. No. L-4851, July 31, 1953). The principle is fundamental that a party aggrieved by a decision of an administrative official should, before coming to court, apply for review of such decision by higher administrative authority (De la Torre v. Trinidad, G. R. No. L-14907, May 30, 1960; Perez v. City Mayor, et al., G. R. No. L-16786, Oct. 31, 1961). This principle rests on the presumption that the administrative agency, if afforded a complete chance to pass upon the matter, will decide the same correctly. IN VIEW HEREOF, the order of dismissal is hereby affirmed, with costs. Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Reyes. J.B.L., Barrera, Paredes and Dizon JJ. concur.

PACANA VS. CONSUNJI

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. L-41088 October 30, 1981 ARTEMIO B. PACANA, petitioner, vs. THE HONORABLE DAVID M. CONSUNJI, in his capacity as Secretary of Public Works, Transportation and Communications, and THE HONORABLE POSTMASTER GENERAL, respondents.

FERNANDO, C.J.: The authoritative force of Antonio v. Tanco, Jr. 1 calls for application in this certiorari and mandamus petition. It is essentially the latter proceeding as what is sought is the reinstatement of petitioner Artemio B. Pacana who, by virtue of a decision of the then respondent Secretary of Public Works, Transportation and Communications, David M. Consunji, was dismissed from the service on March 11, 1974. The allegations on their face more than suggested that petitioner was not on the best of terms with the then Postmaster General Enrico Palomar, resulting in the audit examinations not once but three times of his accountability as Acting Postmaster of Cagayan de Oro City. 2 On a charge of dishonesty for using a mail car personally, he was cleared by the then Secretary Baltazar Aquino. 3 He was, however, found guilty of the charge arising from the shortage in the funds, resulting in the order of dismissal. 4 He filed a motion for reconsideration but it was denied. 5 That led him to devote the matter through an appeal to the Civil Service Commission, and, which appeal is still pending for consideration. 6 As was pointed out in the Comment of Solicitor General Estelito Mendoza, considered as the Answer, with the availability to petitioner of an adequate administrative remedy such as the appeal taken by him, this "civil action for certiorari and mandamus certainly will not lie. 7 The admission of the pendency of the appeal is thus fatal to petitioner's invocation of a judicial remedy at this stage. So the above-cited case of Antonio v. Tanco Jr. ruled in language explicit and categorical: "As correctly observed by the Solicitor General, Antonio, by requesting the President to revoke Secretary Tanco's suspension order, precluded judicial intervention in his case while his request is pending consideration. 8 It needs only to be pointed out that the formulation in the ponencia of Justice Aquino is a restatement of a well-settled doctrine. The reason is quite evident. It is true that the judiciary could be appealed to to set aside or nullify official action that runs counter to a legal norm. So the rule of law prescribes. At the same time if a remedy may be afforded by the executive branch, with respect to matters peculiarly within its competence, it should be given the opportunity to correct the error or deficiency in the order or determination thus assailed. For one thing, it is in a much better position to set matters right. For another, it is likely to develop an orderly and efficient procedure as to such matters. The Antonio opinion thus finds support in a number of cases. 9 In the traditional administrative law terminology, the stage of ripeness for adjudication has not been reached. An attempt, albeit unsuccessful, is made by petitioner to blunt the authoritative force of the Antonio ruling by alleging a procedural due process question. Reyes v. Subido 10 could then be relied upon to seek judicial relief without resorting to exhausting an obvious administrative remedy. As was made clear in Reyes from Lacson v.

Romero 11 to Cornejo v. Secretary of Justice, 12 there are at least ten such decisions. It is not to be ignored, however, that in Reyes, there was no appeal taken, the matter being brought to this Court immediately. There is another consideration that argues against a favorable outcome of this petition. In the decision of respondent Consunji dated March 11, 1974, it was specifically stated: "Formally charged with the aforecited offenses, respondent in each individual case elected a formal hearing which was granted. During the formal hearing, involving the amount of P58,681.72, it was established that respondent incurred the shortage. 13In his motion for reconsideration dated April 26, 1974, he pointed out that the investigation had not as yet been terminated primarily because of the denial of the opportunity to him to confront the witnesses against him. When the said motion for reconsideration was denied on March 4, 1975, it was stated categorically by respondent Consunji "that facts and evidences on record undoubtedly indicate that he incurred the shortage of P58,681.72."14 In the dispositive portion of such resolution, it was explicitly stated "that petitioner Artemio Pacana failed to submit any new and material evidence to warrant a modification of the decision sought to be reconsidered, [hence] the instant petition is hereby denied for lack of merit. " 15 Such motion for reconsideration afforded him the opportunity to submit the evidence that would clear him of the charges of the shortage of funds but he failed to do so. Under the circumstances, and with the pendency of his appeal, this Court is of the opinion, as stated at the outset, that the petition cannot prosper. WHEREFORE, the petition is dismissed for lack of merit. Barredo, Aquino, Concepcion, Jr., Abad Santos and De Castro, JJ., concur.

Footnotes 1 L-38135, July 25, 1975, 65 SCRA 448. 2 Amended Petition, pars. 6-8, 10-11. 3 Ibid, pars. 5 and 12. 4 Ibid, par. 14. 5 Ibid, pars. 15 and 16. 6 Ibid, par. 17. The paragraph reads in full: "On April 26, 1975, your petitioner filed his appeal to the Civil Service Commission, and which appeal is still pending for consideration. A copy of the said appeal is hereto attached, marked as Annex 'F' and made an integral part hereof but notwithstanding this pending appeal, your petitioner comes before this Honorable Tribunal to rest his cause." 7 Comment of Solicitor General, 11. He was assisted by Assistant Solicitor General Alicia V. Sempio-Diy and Solicitor Edgardo L. Kilayko. 8 65 SCRA 448,4,55. 9 Cf. Ang Tuan Kai v. Import Control Commission, 91 Phil. 143 (1952); Santiago v. Cruz, 98 Phil. 168 (1955); Peralta v. Salcedo, 101 Phil. 452 (1957); Montes v. Civil Service Board of Appeals, 101 Phil. 490 (1957); Cruz v. Del Romero, 119 Phil. 63 (1963); Gonzales v. Provincial Auditor of Iloilo 120 Phil. 1508 (1964). These are the decisions cited by Justice Aquino.

LUZON DEV. BANK VS. ASSOCIATION

Republic of the Philippines SUPREME COURT Manila EN BANC

G.R. No. 120319 October 6, 1995 LUZON DEVELOPMENT BANK, petitioner, vs. ASSOCIATION OF LUZON DEVELOPMENT BANK EMPLOYEES and ATTY. ESTER S. GARCIA in her capacity as VOLUNTARY ARBITRATOR, respondents.

ROMERO, J.: From a submission agreement of the Luzon Development Bank (LDB) and the Association of Luzon Development Bank Employees (ALDBE) arose an arbitration case to resolve the following issue: Whether or not the company has violated the Collective Bargaining Agreement provision and the Memorandum of Agreement dated April 1994, on promotion. At a conference, the parties agreed on the submission of their respective Position Papers on December 1-15, 1994. Atty. Ester S. Garcia, in her capacity as Voluntary Arbitrator, received ALDBE's Position Paper on January 18, 1995. LDB, on the other hand, failed to submit its Position Paper despite a letter from the Voluntary Arbitrator reminding them to do so. As of May 23, 1995 no Position Paper had been filed by LDB. On May 24, 1995, without LDB's Position Paper, the Voluntary Arbitrator rendered a decision disposing as follows: WHEREFORE, finding is hereby made that the Bank has not adhered to the Collective Bargaining Agreement provision nor the Memorandum of Agreement on promotion. Hence, this petition for certiorari and prohibition seeking to set aside the decision of the Voluntary Arbitrator and to prohibit her from enforcing the same. In labor law context, arbitration is the reference of a labor dispute to an impartial third person for determination on the basis of evidence and arguments presented by such parties who have bound themselves to accept the decision of the arbitrator as final and binding. Arbitration may be classified, on the basis of the obligation on which it is based, as either compulsory or voluntary. Compulsory arbitration is a system whereby the parties to a dispute are compelled by the government to forego their right to strike and are compelled to accept the resolution of their dispute through arbitration by a third party. 1The essence of arbitration remains since a resolution

of a dispute is arrived at by resort to a disinterested third party whose decision is final and binding on the parties, but in compulsory arbitration, such a third party is normally appointed by the government. Under voluntary arbitration, on the other hand, referral of a dispute by the parties is made, pursuant to a voluntary arbitration clause in their collective agreement, to an impartial third person for a final and binding resolution. 2Ideally, arbitration awards are supposed to be complied with by both parties without delay, such that once an award has been rendered by an arbitrator, nothing is left to be done by both parties but to comply with the same. After all, they are presumed to have freely chosen arbitration as the mode of settlement for that particular dispute. Pursuant thereto, they have chosen a mutually acceptable arbitrator who shall hear and decide their case. Above all, they have mutually agreed to de bound by said arbitrator's decision. In the Philippine context, the parties to a Collective Bargaining Agreement (CBA) are required to include therein provisions for a machinery for the resolution of grievances arising from the interpretation or implementation of the CBA or company personnel policies. 3 For this purpose, parties to a CBA shall name and designate therein a voluntary arbitrator or a panel of arbitrators, or include a procedure for their selection, preferably from those accredited by the National Conciliation and Mediation Board (NCMB). Article 261 of the Labor Code accordingly provides for exclusive original jurisdiction of such voluntary arbitrator or panel of arbitrators over (1) the interpretation or implementation of the CBA and (2) the interpretation or enforcement of company personnel policies. Article 262 authorizes them, but only upon agreement of the parties, to exercise jurisdiction over other labor disputes. On the other hand, a labor arbiter under Article 217 of the Labor Code has jurisdiction over the following enumerated cases: . . . (a) Except as otherwise provided under this Code the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non-agricultural: 1. Unfair labor practice cases; 2. Termination disputes; 3. If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment; 4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations; 5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; 6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims, arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement. xxx xxx xxx

It will thus be noted that the jurisdiction conferred by law on a voluntary arbitrator or a panel of such arbitrators is quite limited compared to the original jurisdiction of the labor arbiter and the appellate jurisdiction of the National Labor Relations Commission (NLRC) for that matter. 4 The state of our present law relating to voluntary arbitration provides that "(t)he award or decision of the Voluntary Arbitrator . . . shall be final and executory after ten (10) calendar days from receipt of the copy of the award or decision by the parties," 5 while the "(d)ecision, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders." 6 Hence, while there is an express mode of appeal from the decision of a labor arbiter, Republic Act No. 6715 is silent with respect to an appeal from the decision of a voluntary arbitrator. Yet, past practice shows that a decision or award of a voluntary arbitrator is, more often than not, elevated to the Supreme Court itself on a petition for certiorari, 7 in effect equating the voluntary arbitrator with the NLRC or the Court of Appeals. In the view of the Court, this is illogical and imposes an unnecessary burden upon it. In Volkschel Labor Union, et al. v. NLRC, et al., 8 on the settled premise that the judgments of courts and awards of quasi-judicial agencies must become final at some definite time, this Court ruled that the awards of voluntary arbitrators determine the rights of parties; hence, their decisions have the same legal effect as judgments of a court. In Oceanic Bic Division (FFW), et al. v. Romero, et al., 9 this Court ruled that "a voluntary arbitrator by the nature of her functions acts in a quasi-judicial capacity." Under these rulings, it follows that the voluntary arbitrator, whether acting solely or in a panel, enjoys in law the status of a quasi-judicial agency but independent of, and apart from, the NLRC since his decisions are not appealable to the latter. 10 Section 9 of B.P. Blg. 129, as amended by Republic Act No. 7902, provides that the Court of Appeals shall exercise: xxx xxx xxx (B) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or commissions, including the Securities and Exchange Commission, the Employees Compensation Commission and the Civil Service Commission, except those falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the Labor Code of the Philippines under Presidential Decree No. 442, as amended, the provisions of this Act, and of subparagraph (1) of the third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948. xxx xxx xxx Assuming arguendo that the voluntary arbitrator or the panel of voluntary arbitrators may not strictly be considered as a quasi-judicial agency, board or commission, still both he and the panel are comprehended within the concept of a "quasi-judicial instrumentality." It may even be stated that it was to meet the very situation presented by the quasi-judicial functions of the voluntary arbitrators here, as well as the subsequent arbitrator/arbitral tribunal operating under the Construction Industry Arbitration Commission, 11 that the broader term "instrumentalities" was purposely included in the above-quoted provision. An "instrumentality" is anything used as a means or agency. 12 Thus, the terms governmental "agency" or "instrumentality" are synonymous in the sense that either of them is a means by which a government acts, or by which a certain government act or function is performed. 13 The word "instrumentality," with respect to a state, contemplates an authority to which the state delegates governmental power for the performance of a state function. 14 An individual person, like an administrator or executor, is a judicial instrumentality in the settling of an estate, 15 in the

same manner that a sub-agent appointed by a bankruptcy court is an instrumentality of the court,16 and a trustee in bankruptcy of a defunct corporation is an instrumentality of the state. 17 The voluntary arbitrator no less performs a state function pursuant to a governmental power delegated to him under the provisions therefor in the Labor Code and he falls, therefore, within the contemplation of the term "instrumentality" in the aforequoted Sec. 9 of B.P. 129. The fact that his functions and powers are provided for in the Labor Code does not place him within the exceptions to said Sec. 9 since he is a quasi-judicial instrumentality as contemplated therein. It will be noted that, although the Employees Compensation Commission is also provided for in the Labor Code, Circular No. 1-91, which is the forerunner of the present Revised Administrative Circular No. 1-95, laid down the procedure for the appealability of its decisions to the Court of Appeals under the foregoing rationalization, and this was later adopted by Republic Act No. 7902 in amending Sec. 9 of B.P. 129. A fortiori, the decision or award of the voluntary arbitrator or panel of arbitrators should likewise be appealable to the Court of Appeals, in line with the procedure outlined in Revised Administrative Circular No. 1-95, just like those of the quasi-judicial agencies, boards and commissions enumerated therein. This would be in furtherance of, and consistent with, the original purpose of Circular No. 1-91 to provide a uniform procedure for the appellate review of adjudications of all quasi-judicial entities 18 not expressly excepted from the coverage of Sec. 9 of B.P. 129 by either the Constitution or another statute. Nor will it run counter to the legislative intendment that decisions of the NLRC be reviewable directly by the Supreme Court since, precisely, the cases within the adjudicative competence of the voluntary arbitrator are excluded from the jurisdiction of the NLRC or the labor arbiter. In the same vein, it is worth mentioning that under Section 22 of Republic Act No. 876, also known as the Arbitration Law, arbitration is deemed a special proceeding of which the court specified in the contract or submission, or if none be specified, the Regional Trial Court for the province or city in which one of the parties resides or is doing business, or in which the arbitration is held, shall have jurisdiction. A party to the controversy may, at any time within one (1) month after an award is made, apply to the court having jurisdiction for an order confirming the award and the court must grant such order unless the award is vacated, modified or corrected. 19 In effect, this equates the award or decision of the voluntary arbitrator with that of the regional trial court. Consequently, in a petition for certiorari from that award or decision, the Court of Appeals must be deemed to have concurrent jurisdiction with the Supreme Court. As a matter of policy, this Court shall henceforth remand to the Court of Appeals petitions of this nature for proper disposition. ACCORDINGLY, the Court resolved to REFER this case to the Court of Appeals. SO ORDERED. Padilla, Regalado, Davide, Jr., Bellosillo, Puno, Vitug, Kapunan, Mendoza, Francisco and Hermosisima, Jr., JJ., concur. Feliciano, J., concurs in the result. Narvasa, C.J. and Melo, J. are on leave. Footnotes 1 Seide, A Dictionary of Arbitration (1970).

2 Ibid. 3 Art. 260, Labor Code. 4 Art. 217, Labor Code. 5 Art. 262-A, par. 4, Labor Code. 6 Art. 223, Labor Code. 7 Oceanic Bic Division (FFW), et al. v. Romero, et al., 130 SCRA 392 (1984); Sime Darby Pilipinas, Inc. v. Magsalin, et al., 180 SCRA 177 (1989). 8 98 SCRA 314 (1980). 9 Supra. 10 Art. 262-A, in relation to Art. 217 (b) and (c), Labor Code, as amended by Sec. 9, R.A. 6715. 11 Executive Order No. 1008. 12 Laurens Federal Sav. and Loan Ass'n v. South Carolina Tax Commission, 112 S.E. 2d 716, 719, 236 S.C. 2. 13 Govt. of P.I. v. Springer, et al., 50 Phil. 259, 334 (1927). 14 Ciulla v. State, 77 N.Y.S. 2d 545, 550, 191 Misc. 528. 15 In re Turncock's Estate, 300 N.W. 155, 156, 238 Wis. 438. 16 In re Brown Co., D.C. Me., 36 F. Supp. 275, 277. 17 Gagne v. Brush, D.C.N.H., 30 F. Supp. 714, 716. 18 First Lepanto Ceramics, Inc. v. CA, et al., 231 SCRA 30 (1994). 19 Section 23, R.A. No. 876.

DARIO VS. MISON Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. 81954 August 8, 1989

CESAR Z. DARIO, petitioner, vs. HON. SALVADOR M. MISON, HON. VICENTE JAYME and HON. CATALINO MACARAIG, JR., in their respective capacities as Commissioner of Customs, Secretary of Finance, and Executive Secretary,respondents. G.R. No. 81967 August 8, 1989

VICENTE A. FERIA JR., petitioner, vs. HON. SALVADOR M. MISON, HON. VICENTE JAYME, and HON. CATALINO MACARAIG, JR., in their respective capacities as Commissioner of Customs, Secretary of Finance, and Executive Secretary,respondents. G.R. No. 82023 August 8, 1989

ADOLFO CASARENO, PACIFICO LAGLEVA, JULIAN C. ESPIRITU, DENNIS A. AZARRAGA, RENATO DE JESUS, NICASIO C. GAMBOA, CORAZON RALLOS NIEVES, FELICITACION R. GELUZ, LEODEGARIO H. FLORESCA, SUBAER PACASUM, ZENAIDA LANARIA, JOSE B. ORTIZ, GLICERIO R. DOLAR, CORNELIO NAPA, PABLO B. SANTOS, FERMIN RODRIGUEZ, DALISAY BAUTISTA, LEONARDO JOSE, ALBERTO LONTOK, PORFIRIO TABINO, JOSE BARREDO, ROBERTO ARNALDO, ESTER TAN, PEDRO BAKAL, ROSARIO DAVID, RODOLFO AFUANG, LORENZO CATRE, LEONCIA CATRE, ROBERTO ABADA, petitioners, vs. COMMISSIONER SALVADOR M. MISON, COMMISSIONER, BUREAU OF CUSTOMS, respondent. G.R. No. 83737 August 8, 1989

BENEDICTO L. AMASA and WILLIAM S. DIONISIO, petitioners, vs. PATRICIA A. STO. TOMAS, in her capacity as Chairman of the Civil Service Commission and SALVADOR MISON, in his capacity as Commissioner of the Bureau of Customs, respondents. G.R. No. 85310 August 8, 1989

SALVADOR M. MISON, in his capacity as Commissioner of Customs, petitioner, vs. CIVIL SERVICE COMMISSION, ABACA, SISINIO T., ABAD, ROGELIO C., ABADIANO, JOSE P., ABCEDE, NEMECIO C., ABIOG, ELY F., ABLAZA, AURORA M., AGBAYANI, NELSON I., AGRES ANICETO, AGUILAR, FLOR, AGUILUCHO MA. TERESA R., AGUSTIN, BONIFACIO T., ALANO, ALEX P., ALBA, MAXIMO F. JR., ALBANO, ROBERT B., ALCANTARA, JOSE G., ALMARIO, RODOLFO F., ALVEZ, ROMUALDO R., AMISTAD RUDY M., AMOS, FRANCIS

F., ANDRES, RODRIGO V., ANGELES, RICARDO S., ANOLIN, MILAGROS H., AQUINO, PASCASIO E., ARABE, MELINDA M., ARCANGEL, AGUSTIN S., JR., ARPON, ULPLIANO U., JR., ARREZA, ARTEMIO M., JR., ARROJO, ANTONIO P., ARVISU, ALEXANDER S., ASCA;O, ANTONIO T., ASLAHON, JULAHON P., ASUNCION, VICTOR R., ATANGAN, LORNA S., ATIENZA, ALEXANDER R., BACAL, URSULINO C., BA;AGA, MARLOWE, Z., BANTA, ALBERTO T., BARREDO, JOSE B., BARROS, VICTOR C., BARTOLOME, FELIPE A., BAYSAC, REYNALDO S., BELENO, ANTONIO B., BERNARDO, ROMEO D., BERNAS, MARCIANO S., BOHOL, AUXILIADOR G., BRAVO, VICTOR M., BULEG, BALILIS R., CALNEA, MERCEDES M., CALVO, HONESTO G., CAMACHO, CARLOS V., CAMPOS, RODOLFO C., CAPULONG, RODRIGO G., CARINGAL, GRACIA Z., CARLOS, LORENZO B., CARRANTO, FIDEL U., CARUNGCONG, ALFREDO M., CASTRO, PATRICIA J., CATELO, ROGELIO B., CATURLA, MANUEL B., CENIZAL, JOSEFINA F., CINCO, LUISITO, CONDE0, JOSE C., JR., CORCUERA, FIDEL S., CORNETA, VICENTE S., CORONADO, RICARDO S., CRUZ, EDUARDO S., CRUZ, EDILBERTO A., CRUZ, EFIGENIA B., CRUZADO, MARCIAL C., CUSTODIO, RODOLFO M., DABON, NORMA M., DALINDIN, EDNA MAE D., DANDAL, EDEN F., DATUHARON, SATA A., DAZO, GODOFREDO L., DE CASTRO, LEOPAPA, DE GUZMAN, ANTONIO A., DE GUZMAN, RENATO E., DE LA CRUZ, AMADO A., JR., DE LA CRUZ, FRANCISCO C., DE LA PE;A, LEONARDO, DEL CAMPO, ORLANDO, DEL RIO, MAMERTO P., JR., DEMESA, WILHELMINA T., DIMAKUTA, SALIC L., DIZON, FELICITAS A., DOCTOR, HEIDY M., DOLAR, GLICERIO R., DOMINGO, NICANOR J., DOMINGO, PERFECTO V., JR., DUAY, JUANA G., DYSANGCO, RENATO F., EDILLOR, ALFREDO P., ELEVAZO, LEONARDO A., ESCUYOS, MANUEL M., JR., ESMERIA, ANTONIO E., ESPALDON, MA. LOURDES H., ESPINA, FRANCO A., ESTURCO, RODOLFO C., EVANGELINO, FERMIN I., FELIX, ERNESTO G., FERNANDEZ, ANDREW M., FERRAREN, ANTONIO C., FERRERA, WENCESLAO A., FRANCISCO, PELAGIO S., JR., FUENTES, RUDY L., GAGALANG, RENATO V., GALANG, EDGARDO R., GAMBOA, ANTONIO C., GAN, ALBERTO R., GARCIA, GILBERT M., GARCIA, EDNA V., GARCIA, JUAN L., GAVIOLA, LILIAN V., GEMPARO, SEGUNDINA G., GOBENCIONG, FLORDELIZ B., GRATE, FREDERICK R., GREGORIO, LAURO P., GUARTICO, AMMON H., GUIANG, MYRNA N., GUINTO, DELFIN C., HERNANDEZ, LUCAS A., HONRALES, LORETO N., HUERTO, LEOPOLDO H., HULAR , LANNYROSS E., IBA;EZ, ESTER C., ILAGAN, HONORATO C., INFANTE, REYNALDO C., ISAIS, RAY C., ISMAEL, HADJI AKRAM B., JANOLO, VIRGILIO M., JAVIER, AMADOR L., JAVIER, ROBERTO S., JAVIER, WILLIAM R., JOVEN, MEMIA A., JULIAN, REYNALDO V., JUMAMOY, ABUNDIO A., JUMAQUIAO, DOMINGO F., KAINDOY, PASCUAL B., JR., KOH, NANIE G., LABILLES, ERNESTO S., LABRADOR, WILFREDO M., LAGA, BIENVENIDO M., LAGLEVA, PACIFICO Z., LAGMAN, EVANGELINE G., LAMPONG, WILFREDO G., LANDICHO, RESTITUTO A., LAPITAN, CAMILO M., LAURENTE, REYNALDO A., LICARTE, EVARISTO R., LIPIO, VICTOR O., LITTAUA, FRANKLIN Z., LOPEZ, MELENCIO L., LUMBA, OLIVIA., MACAISA, BENITO T., MACAISA, ERLINDA C., MAGAT, ELPIDIO, MAGLAYA, FERNANDO P., MALABANAN, ALFREDO C., MALIBIRAN, ROSITA D., MALIJAN, LAZARO V., MALLI, JAVIER M., MANAHAN, RAMON S., MANUEL, ELPIDIO R., MARAVILLA, GIL B., MARCELO, GIL C., MARI;AS, RODOLFO V., MAROKET, JESUS C., MARTIN, NEMENCIO A., MARTINEZ, ROMEO M., MARTINEZ, ROSELINA M., MATIBAG, ANGELINA G., MATUGAS, ERNESTO T., MATUGAS, FRANCISCO T., MAYUGA, PORTIA E., MEDINA, NESTOR M., MEDINA, ROLANDO S., MENDAVIA, AVELINO I., MENDOZA, POTENCIANO G., MIL, RAY M., MIRAVALLES, ANASTACIA L., MONFORTE, EUGENIO, JR., G., MONTANO, ERNESTO F., MONTERO, JUAN M. III., MORALDE, ESMERALDO B., JR., MORALES, CONCHITA D.L., MORALES, NESTOR P., MORALES, SHIRLEY S., MUNAR, JUANITA L., MU;OZ, VICENTE R., MURILLO, MANUEL M., NACION, PEDRO R., NAGAL, HENRY N., NAPA, CORNELIO B., NAVARRO, HENRY L., NEJAL, FREDRICK E., NICOLAS, REYNALDO S., NIEVES, RUFINO A., OLAIVAR, SEBASTIAN T., OLEGARIO, LEO Q., ORTEGA, ARLENE R., ORTEGA, JESUS R., OSORIO, ABNER S., PAPIO, FLORENTINO T. II, PASCUA, ARNULFO A., PASTOR, ROSARIO, PELAYO, ROSARIO L., PE;A, AIDA C., PEREZ, ESPERIDION B., PEREZ, JESUS BAYANI M., PRE, ISIDRO A., PRUDENCIADO, EULOGIA S., PUNZALAN, LAMBERTO N., PURA, ARNOLD T., QUINONES, EDGARDO I., QUINTOS, AMADEO C., JR., QUIRAY, NICOLAS C., RAMIREZ, ROBERTO P., RA;ADA, RODRIGO C., RARAS, ANTONIO A., RAVAL, VIOLETA V., RAZAL, BETTY R., REGALA,

PONCE F., REYES, LIBERATO R., REYES, MANUEL E., REYES, NORMA Z., REYES, TELESFORO F., RIVERA, ROSITA L., ROCES, ROBERTO V., ROQUE, TERESITA S., ROSANES, MARILOU M., ROSETE, ADAN I., RUANTO, REY, CRISTO C., JR., SABLADA, PASCASIO G., SALAZAR, SILVERIA S., SALAZAR, VICTORIA A., SALIMBACOD, PERLITA C., SALMINGO, LOURDES M., SANTIAGO, EMELITA B., SATINA, PORFIRIO C., SEKITO, COSME B., JR., SIMON, RAMON P., SINGSON, MELECIO C., SORIANO, ANGELO L., SORIANO, MAGDALENA R., SUMULONG, ISIDRO L., JR., SUNICO, ABELARDO T., TABIJE, EMMA B., TAN, RUDY, GOROSPE, TAN, ESTER S., TAN, JULITA S., TECSON, BEATRIZ B., TOLENTINO, BENIGNO A., TURINGAN, ENRICO T., JR., UMPA, ALI A., VALIC, LUCIO E., VASQUEZ, NICANOR B., VELARDE, EDGARDO C., VERA, AVELINO A., VERAME, OSCAR E., VIADO, LILIAN T., VIERNES, NAPOLEON K., VILLALON, DENNIS A., VILLAR, LUZ L., VILLALUZ, EMELITO V., ZATA, ANGEL A., JR., ACHARON, CRISTETO, ALBA, RENATO B., AMON, JULITA C., AUSTRIA, ERNESTO C., CALO, RAYMUNDO M., CENTENO, BENJAMIN R., DE CASTRO, LEOPAPA C ., DONATO, ESTELITA P., DONATO, FELIPE S., FLORES, PEDRITO S., GALAROSA, RENATO, MALAWI, MAUYAG, MONTENEGRO, FRANCISCO M., OMEGA, PETRONILO T., SANTOS, GUILLERMO F., TEMPLO, CELSO, VALDERAMA, JAIME B., and VALDEZ, NORA M., respondents. G.R. No. 85335 August 8, 1989

FRANKLIN Z. LITTAUA, ADAN I. ROSETE, FRANCISCO T. MATUGAS, MA. J. ANGELINA G. MATIBAG, LEODEGARDIO H. FLORESCA, LEONARDO A. DELA PE;A, ABELARDO T. SUNICO, MELENCIO L. LOPEZ, NEMENCIO A. MARTIN, RUDY M. AMISTAD, ERNESTO T. MATUGAS, SILVERIA S. SALAZAR, LILLIAN V. GAVIOLA, MILAGROS ANOLIN, JOSE B. ORTIZ, ARTEMIO ARREZA, JR., GILVERTO M. GARCIA, ANTONIO A. RARAS, FLORDELINA B. GOBENCIONG, ANICETO AGRES, EDGAR Y. QUINONES, MANUEL B. CATURLA, ELY F. ABIOG, RODRIGO C. RANADA, LAURO GREGORIO, ALBERTO I. GAN, EDGARDO GALANG, RAY C. ISAIS, NICANOR B. VASQUEZ, MANUEL ESCUYOS, JR., ANTONIO B. BELENO, ELPIO R. MANUEL, AUXILIADOR C. BOHOL, LEONARDO ELEVAZO, VICENTE S. CORNETA, petitioners, vs. COM. SALVADOR M. MISON/BUREAU OF CUSTOMS and the CIVIL SERVICE COMMISSION, respondents. G.R. No. 86241 August 8, 1989

SALVADOR M. MISON, in his capacity as Commissioner of Customs, petitioner, vs. CIVIL SERVICE COMMISSION, SENEN S. DIMAGUILA, ROMEO P. ARABE BERNARDO S. QUINTONG, GREGORIO P. REYES, and ROMULO C. BADILLO respondents

SARMIENTO, J.:

The Court writes finis to this contreversy that has raged bitterly for the several months. It does so out of ligitimate presentement of more suits reaching it as a consequence of the government reorganization and the instability it has wrought on the performance and efficiency of the bureaucracy. The Court is apprehensive that unless the final word is given and the ground rules are settled, the issue will fester, and likely foment on the constitutional crisis for the nation, itself biset with grave and serious problems.

The facts are not in dispute. On March 25, 1986, President Corazon Aquino promulgated Proclamation No. 3, "DECLARING A NATIONAL POLICY TO IMPLEMENT THE REFORMS MANDATED BY THE PEOPLE, PROTECTING THEIR BASIC RIGHTS, ADOPTING A PROVISIONAL CONSTITUTION, AND PROVIDING FOR AN ORDERLY TRANSITION TO A GOVERNMENT UNDER A NEW CONSTITUTION." Among other things, Proclamation No. 3 provided: SECTION 1. ... The President shall give priority to measures to achieve the mandate of the people to: (a) Completely reorganize the government, eradicate unjust and oppressive structures, and all iniquitous vestiges of the previous regime; 1 ... Pursuant thereto, it was also provided: SECTION 1. In the reorganization of the government, priority shall be given to measures to promote economy, efficiency, and the eradication of graft and corruption. SECTION 2. All elective and appointive officials and employees under the 1973 Constitution shall continue in office until otherwise provided by proclamation or executive order or upon the appointment and qualification of their successors, if such is made within a period of one year from February 25, 1986. SECTION 3. Any public officer or employee separated from the service as a result of the organization effected under this Proclamation shall, if entitled under the laws then in force, receive the retirement and other benefits accruing thereunder. SECTION 4. The records, equipment, buildings, facilities and other properties of all government offices shall be carefully preserved. In case any office or body is abolished or reorganized pursuant to this Proclamation, its FUNDS and properties shall be transferred to the office or body to which its powers, functions and responsibilities substantially pertain. 2 Actually, the reorganization process started as early as February 25, 1986, when the President, in her first act in office, called upon "all appointive public officials to submit their courtesy resignation(s) beginning with the members of the Supreme Court."3 Later on, she abolished the Batasang Pambansa4 and the positions of Prime Minister and Cabinet 5 under the 1973 Constitution. Since then, the President has issued a number of executive orders and directives reorganizing various other government offices, a number of which, with respect to elected local officials, has been challenged in this Court, 6and two of which, with respect to appointed functionaries, have likewise been questioned herein. 7 On May 28, 1986, the President enacted Executive Order No. 17, "PRESCRIBING RULES AND REGULATIONS FOR THE IMPLEMENTATION OF SECTION 2, ARTICLE III OF THE FREEDOM CONSTITUTION." Executive Order No. 17 recognized the "unnecessary anxiety and demoralization among the deserving officials and employees" the ongoing government reorganization had generated, and prescribed as "grounds for the separation/replacement of personnel," the following:

SECTION 3. The following shall be the grounds for separation replacement of personnel: 1) Existence of a case for summary dismissal pursuant to Section 40 of the Civil Service Law; 2) Existence of a probable cause for violation of the Anti-Graft and Corrupt Practices Act as determined by the Mnistry Head concerned; 3) Gross incompetence or inefficiency in the discharge of functions; 4) Misuse of public office for partisan political purposes; 5) Any other analogous ground showing that the incumbent is unfit to remain in the service or his separation/replacement is in the interest of the service.8 On January 30, 1987, the President promulgated Executive Order No. 127, "REORGANIZING THE MINISTRY OF FINANCE." 9 Among other offices, Executive Order No. 127 provided for the reorganization of the Bureau of Customs 10 and prescribed a new staffing pattern therefor. Three days later, on February 2, 1987, 11 the Filipino people adopted the new Constitution. On January 6, 1988, incumbent Commissioner of Customs Salvador Mison issued a Memorandum, in the nature of "Guidelines on the Implementation of Reorganization Executive Orders," 12 prescribing the procedure in personnel placement. It also provided: 1. By February 28, 1988, the employees covered by Executive Order 127 and the grace period extended to the Bureau of Customs by the President of the Philippines on reorganization shall be: a) informed of their re-appointment, or b) offered another position in the same department or agency or c) informed of their termination. 13 On the same date, Commissioner Mison constituted a Reorganization Appeals Board charged with adjudicating appeals from removals under the above Memorandum. 14 On January 26, 1988, Commissioner Mison addressed several notices to various Customs officials, in the tenor as follows: Sir: Please be informed that the Bureau is now in the process of implementing the Reorganization Program under Executive Order No. 127. Pursuant to Section 59 of the same Executive Order, all officers and employees of the Department of Finance, or the Bureau of Customs in particular, shall continue to perform their respective duties and responsibilities in a hold-over capacity, and that those incumbents whose positions are not carried in the new reorganization pattern, or who are not re- appointed, shall be deemed separated from the service. In this connection, we regret to inform you that your services are hereby terminated as of February 28, 1988. Subject to the normal clearances, you may receive the retirement benefits to which you may be entitled under existing laws, rules and regulations.

In the meantime, your name will be included in the consolidated list compiled by the Civil Service Commission so that you may be given priority for future employment with the Government as the need arises. Sincerely yours, (Sgd) SALVADOR M. MISON Commissioner15 As far as the records will yield, the following were recipients of these notices: 1. CESAR DARIO 2. VICENTE FERIA, JR. 3. ADOLFO CASARENO 4. PACIFICO LAGLEVA 5. JULIAN C. ESPIRITU 6. DENNIS A. AZARRAGA 7. RENATO DE JESUS 8. NICASIO C. GAMBOA 9. CORAZON RALLOS NIEVES 10. FELICITACION R. GELUZ 11. LEODEGARIO H. FLORESCA 12. SUBAER PACASUM 13. ZENAIDA LANARIA 14. JOSE B. ORTIZ 15. GLICERIO R. DOLAR 16. CORNELIO NAPA 17. PABLO B. SANTOS 18. FERMIN RODRIGUEZ 19. DALISAY BAUTISTA 20. LEONARDO JOSE 21. ALBERTO LONTOK

22. PORFIRIO TABINO 23. JOSE BARREDO 24. ROBERTO ARNALDO 25. ESTER TAN 26. PEDRO BAKAL 27. ROSARIO DAVID 28. RODOLFO AFUANG 29. LORENZO CATRE 30. LEONCIA CATRE 31. ROBERTO ABADA 32. ABACA, SISINIO T. 33. ABAD, ROGELIO C. 34. ABADIANO, JOSE P 35. ABCEDE, NEMECIO C. 36. ABIOG, ELY F. 37. ABLAZA, AURORA M. 38. AGBAYANI, NELSON I. 39. AGRES, ANICETO 40. AGUILAR, FLOR 41. AGUILUCHO, MA. TERESA R. 42. AGUSTIN, BONIFACIO T. 43. ALANO, ALEX P. 44. ALBA, MAXIMO F. JR. 45. ALBANO, ROBERT B. 46. ALCANTARA, JOSE G. 47. ALMARIO, RODOLFO F.

48. ALVEZ, ROMUALDO R. 49. AMISTAD, RUDY M. 50. AMOS, FRANCIS F. 51. ANDRES, RODRIGO V. 52. ANGELES, RICARDO S. 53. ANOLIN, MILAGROS H. 54. AQUINO, PASCASIO E. L. 55. ARABE, MELINDA M. 56. ARCANGEL, AGUSTIN S, JR. 57. ARPON, ULPIANO U., JR. 58. ARREZA, ARTEMIO M, JR. 59. ARROJO, ANTONIO P. 60. ARVISU, ALEXANDER S. 61. ASCA;O, ANTONIO T. 62. ASLAHON, JULAHON P. 63. ASUNCION, VICTOR R. 64. ATANGAN, LORNA S. 65. ANTIENZA, ALEXANDER R. 66. BACAL URSULINO C. 67. BA;AGA, MARLOWE Z. 68. BANTA, ALBERTO T. 69. BARROS, VICTOR C. 70. BARTOLOME, FELIPE A. 71. BAYSAC, REYNALDO S. 72. BELENO, ANTONIO B. 73. BERNARDO, ROMEO D.

74. BERNAS, MARCIANO S. 75. BOHOL, AUXILIADOR G. 76. BRAVO, VICTOR M. 77. BULEG, BALILIS R. 78. CALNEA, MERCEDES M. 79. CALVO, HONESTO G. 80. CAMACHO, CARLOS V. 81. CAMPOS, RODOLFO C. 82. CAPULONG, RODRIGO G. 83. CARINGAL, GRACIA Z. 84. CARLOS, LORENZO B. 85. CARRANTO, FIDEL U. 86. CARUNGCONG, ALFREDO M. 87. CASTRO, PATRICIA J. 88. CATELO, ROGELIO B. 89. CATURLA, MANUEL B. 90. CENIZAL, JOSEFINA F. 91. CINCO, LUISITO 92. CONDE, JOSE C., JR. 93. CORCUERA, FIDEL S. 94. CORNETA, VICENTE S. 95. CORONADO, RICARDO S. 96. CRUZ, EDUARDO S. 97. CRUZ, EDILBERTO A, 98. CRUZ, EFIGENIA B. 99. CRUZADO,NORMA M.

100. CUSTODIO, RODOLFO M. 101. DABON, NORMA M. 102. DALINDIN, EDNA MAE D. 103. DANDAL, EDEN F. 104. DATUHARON, SATA A. 105. DAZO, GODOFREDO L. 106. DE CASTRO, LEOPAPA 107. DE GUZMAN, ANTONIO A. 108. DE GUZMAN, RENATO E. 109. DE LA CRUZ, AMADO A., JR. 110. DE LA CRUZ, FRANCISCO C. 111. DE LA PE;A, LEONARDO 112. DEL CAMPO, ORLANDO 113. DEL RIO, MAMERTO P., JR. 114. DEMESA, WILHELMINA T. 115. DIMAKUTA, SALIC L. 116. DIZON, FELICITAS A. 117. DOCTOR, HEIDY M. 118. DOMINGO, NICANOR J. 119. DOMINGO, PERFECTO V., JR. 120. DUAY, JUANA G. 121. DYSANGCO, RENATO F. 122. EDILLOR, ALFREDO P. 123. ELEVAZO, LEONARDO A 124. ESCUYOS, MANUEL M., JR. 125. ESMERIA, ANTONIO E.

126. ESPALDON, MA. LOURDES H. 127. ESPINA, FRANCO A. 128. ESTURCO, RODOLFO C. 129. EVANGELINO, FERMIN I. 130. FELIX, ERNESTO G. 131. FERNANDEZ, ANDREW M. 132. FERRAREN, ANTONIO C. 133. FERRERA, WENCESLAO A. 134. FRANCISCO, PELAGIO S, JR. 135. FUENTES, RUDY L. 136. GAGALANG, RENATO V. 137. GALANG, EDGARDO R. 138. GAMBOA, ANTONIO C. 139. GAN, ALBERTO P 140. GARCIA, GILBERT M. 141. GARCIA, EDNA V. 142. GARCIA, JUAN L. 143. GAVIOIA, LILIAN V. 144. GEMPARO, SEGUNDINA G. 145. GOBENCIONG, FLORDELIZ B. 146. GRATE, FREDERICK R. 147. GREGORIO, LAURO P. 148. GUARTICO, AMMON H. 149. GUIANG, MYRNA N. 150. GUINTO, DELFIN C. 151. HERNANDEZ, LUCAS A.

152. HONRALES, LORETO N. 153. HUERTO, LEOPOLDO H. 154. HULAR, LANNYROSS E. 155. IBA;EZ, ESTER C. 156. ILAGAN, HONORATO C. 157. INFANTE, REYNALDO C. 158. ISAIS, RAY C. 159. ISMAEL, HADJI AKRAM B. 160. JANOLO, VIRGILIO M. 161. JAVIER, AMADOR L. 162. JAVIER, ROBERTO S. 163. JAVIER, WILLIAM R. 164. JOVEN, MEMIA A. 165. JULIAN, REYNALDO V. 166. JUMAMOY, ABUNDIO A. 167. JUMAQUIAO, DOMINGO F. 168. KAINDOY, PASCUAL B., JR. 169. KOH, NANIE G. 170. LABILLES, ERNESTO S. 171. LABRADOR, WILFREDO M. 172. LAGA, BIENVENIDO M. 173. LAGMAN, EVANGELINE G. 174. LAMPONG, WILFREDO G. 175. LANDICHO, RESTITUTO A. 176. LAPITAN, CAMILO M. 177. LAURENTE, REYNALDO A.

178. LICARTE, EVARISTO R. 179. LIPIO, VICTOR O. 180. LITTAUA, FRANKLIN Z. 181. LOPEZ, MELENCIO L. 182. LUMBA, OLIVIA R. 183. MACAISA, BENITO T. 184. MACAISA, ERLINDA C. 185. MAGAT, ELPIDIO 186. MAGLAYA, FERNANDO P. 187. MALABANAN, ALFREDO C. 188. MALIBIRAN, ROSITA D. 189. MALIJAN, LAZARO V. 190. MALLI, JAVIER M. 191. MANAHAN, RAMON S. 192. MANUEL, ELPIDIO R. 193. MARAVILLA, GIL B. 194. MARCELO, GIL C. 195. MARI;AS, RODOLFO V. 196. MAROKET ,JESUS C. 197. MARTIN, NEMENCIO A. 198. MARTINEZ, ROMEO M. 199. MARTINEZ, ROSELINA M. 200. MATIBAG, ANGELINA G. 201. MATUGAS, ERNESTO T. 202. MATUGAS, FRANCISCO T. 203. MAYUGA, PORTIA E.

204. MEDINA, NESTOR M. 205. MEDINA, ROLANDO S. 206. MENDAVIA, AVELINO 207. MENDOZA, POTENCIANO G. 208. MIL, RAY M. 209. MIRAVALLES, ANASTACIA L. 210. MONFORTE, EUGENIO, JR. G. 211. MONTANO, ERNESTO F. 212. MONTERO, JUAN M. III 213. MORALDE, ESMERALDO B., JR. 214. MORALES, CONCHITA D. L 215. MORALES, NESTOR P. 216. MORALES, SHIRLEY S. 217. MUNAR, JUANITA L. 218. MU;OZ, VICENTE R. 219. MURILLO, MANUEL M. 220. NACION, PEDRO R. 221. NAGAL, HENRY N. 222. NAVARRO, HENRY L. 223. NEJAL FREDRICK E. 224. NICOLAS, REYNALDO S. 225. NIEVES, RUFINO A. 226. OLAIVAR, SEBASTIAN T. 227. OLEGARIO, LEO Q. 228. ORTEGA, ARLENE R. 229. ORTEGA, JESUS R.

230. OSORIO, ABNER S. 231. PAPIO FLORENTINO T. II 232. PASCUA, ARNULFO A. 233. PASTOR, ROSARIO 234. PELAYO, ROSARIO L. 235. PE;A, AIDA C. 236. PEREZ, ESPERIDION B. 237. PEREZ, JESUS BAYANI M. 238. PRE, ISIDRO A. 239. PRUDENCIADO, EULOGIA S. 240. PUNZALAN, LAMBERTO N. 241. PURA, ARNOLD T. 242. QUINONES, EDGARDO I. 243. QUINTOS, AMADEO C., JR. 244. QUIRAY, NICOLAS C. 245. RAMIREZ, ROBERTO P. 246. RANADA, RODRIGO C. 247. RARAS, ANTONIO A. 248. RAVAL, VIOLETA V. 249. RAZAL, BETTY R. 250. REGALA, PONCE F. 251. REYES, LIBERATO R. 252. REYES, MANUEL E. 253. REYES, NORMA Z. 254. REYES, TELESPORO F. 255. RIVERA, ROSITA L.

256. ROCES, ROBERTO V. 257. ROQUE, TERESITA S. 258. ROSANES, MARILOU M. 259. ROSETE, ADAN I. 260. RUANTO, REY CRISTO C., JR. 261. SABLADA, PASCASIO G. 262. SALAZAR, SILVERIA S. 263. SALAZAR, VICTORIA A. 264. SALIMBACOD, PERLITA C. 265. SALMINGO, LOURDES M. 266. SANTIAGO, EMELITA B. 267. SATINA, PORFIRIO C. 268. SEKITO, COSME B JR. 269. SIMON, RAMON P. 270. SINGSON, MELENCIO C. 271. SORIANO, ANGELO L. 272. SORIANO, MAGDALENA R. 273. SUNICO, ABELARDO T . 274. TABIJE, EMMA B. 275. TAN, RUDY GOROSPE 276. TAN, ESTER S. 277. TAN, JULITA S. 278. TECSON, BEATRIZ B. 279. TOLENTINO, BENIGNO A. 280. TURINGAN, ENRICO T JR. 281. UMPA, ALI A.

282. VALIC, LUCIO E. 283. VASQUEZ, NICANOR B. 284. VELARDE, EDGARDO C. 285. VERA, AVELINO A. 286. VERAME, OSCAR E. 287. VIADO, LILIAN T. 288. VIERNES, NAPOLEON K 289. VILLALON, DENNIS A. 290. VILLAR, LUZ L. 291. VILLALUZ, EMELITO V. 292. VILLAR, LUZ L. 293. ZATA, ANGELA JR. 294. ACHARON, CRISTETO 295. ALBA, RENATO B. 296. AMON, JULITA C. 297. AUSTRIA, ERNESTO C. 298. CALO, RAYMUNDO M. 299. CENTENO, BENJAMIN R. 300. DONATO, ESTELITA P. 301. DONATO, FELIPE S 302. FLORES, PEDRITO S. 303. GALAROSA, RENATO 304. MALAWI, MAUYAG 305. MONTENEGRO, FRANSISCO M. 306. OMEGA, PETRONILO T. 307. SANTOS, GUILLERMO P.

308. TEMPLO, CELSO 309. VALDERAMA, JAIME B. 310. VALDEZ, NORA M. Cesar Dario is the petitioner in G.R. No. 81954; Vicente Feria, Jr., is the petitioner in G.R. No. 81967; Messrs. Adolfo Caserano Pacifico Lagleva Julian C. Espiritu, Dennis A. Azarraga Renato de Jesus, Nicasio C. Gamboa, Mesdames Corazon Rallos Nieves and Felicitacion R. Geluz Messrs. Leodegario H. Floresca, Subaer Pacasum Ms. Zenaida Lanaria Mr. Jose B. Ortiz, Ms. Gliceria R. Dolar, Ms. Cornelia Napa, Pablo B. Santos, Fermin Rodriguez, Ms. Daligay Bautista, Messrs. Leonardo Jose, Alberto Lontok, Porfirio Tabino Jose Barredo, Roberto Arnaldo, Ms. Ester Tan, Messrs. Pedro Bakal, Rosario David, Rodolfo Afuang, Lorenzo Catre,, Ms. Leoncia Catre, and Roberto Abaca, are the petitioners in G.R. No. 82023; the last 279 16 individuals mentioned are the private respondents in G.R. No. 85310. As far as the records will likewise reveal, 17 a total of 394 officials and employees of the Bureau of Customs were given individual notices of separation. A number supposedly sought reinstatement with the Reorganization Appeals Board while others went to the Civil Service Commission. The first thirty-one mentioned above came directly to this Court. On June 30, 1988, the Civil Service Commission promulgated its ruling ordering the reinstatement of the 279 employees, the 279 private respondents in G.R. No. 85310, the dispositive portion of which reads as follows: WHEREFORE, it is hereby ordered that: 1. Appellants be immediately reappointed to positions of comparable or equivalent rank in the Bureau of Customs without loss of seniority rights; 2. Appellants be paid their back salaries reckoned from the dates of their illegal termination based on the rates under the approved new staffing pattern but not lower than their former salaries. This action of the Commission should not, however, be interpreted as an exoneration of the appellants from any accusation of wrongdoing and, therefore, their reappointments are without prejudice to: 1. Proceeding with investigation of appellants with pending administrative cases, and where investigations have been finished, to promptly, render the appropriate decisions; 2. The filing of appropriate administrative complaints against appellants with derogatory reports or information if evidence so warrants. SO ORDERED. 18 On July 15, 1988, Commissioner Mison, represented by the Solicitor General, filed a motion for reconsideration Acting on the motion, the Civil Service Commission, on September 20, 1988, denied reconsideration. 19 On October 20, 1988, Commissioner Mison instituted certiorari proceedings with this Court, docketed, as above-stated, as G.R. No. 85310 of this Court.

On November 16,1988, the Civil Service Commission further disposed the appeal (from the resolution of the Reorganization Appeals Board) of five more employees, holding as follows: WHEREFORE, it is hereby ordered that: 1. Appellants be immediately reappointed to positions of comparable or equivalent rank in the Bureau of Customs without loss of seniority rights; and 2. Appellants be paid their back salaries to be reckoned from the date of their illegal termination based on the rates under the approved new staffing pattern but not lower than their former salaries. This action of the Commission should not, however, be interpreted as an exoneration of the herein appellants from any accusation of any wrongdoing and therefore, their reappointments are without prejudice to: 1. Proceeding with investigation of appellants with pending administrative cases, if any, and where investigations have been finished, to promptly, render the appropriate decisions; and 2. The filing of appropriate administrative complaints against appellant with derogatory reports or information, if any, and if evidence so warrants. SO ORDERED. 20 On January 6, 1989, Commissioner Mison challenged the Civil Service Commission's Resolution in this Court; his petitioner has been docketed herein as G.R. No. 86241. The employees ordered to be reinstated are Senen Dimaguila, Romeo Arabe, Bemardo Quintong,Gregorio Reyes, and Romulo Badillo. 21 On June 10, 1988, Republic Act No. 6656, "AN ACT TO PROTECT THE SECURITY OF TENURE OF CIVIL SERVICE OFFICERS AND EMPLOYEES IN THE IMPLEMENTATION OF GOVERNMENT REORGANIZATION," 22was signed into law. Under Section 7, thereof: Sec. 9. All officers and employees who are found by the Civil Service Commission to have been separated in violation of the provisions of this Act, shall be ordered reinstated or reappointed as the case may be without loss of seniority and shall be entitled to full pay for the period of separation. Unless also separated for cause, all officers and employees, including casuals and temporary employees, who have been separated pursuant to reorganization shall, if entitled thereto, be paid the appropriate separation pay and retirement and other benefits under existing laws within ninety (90) days from the date of the effectivity of their separation or from the date of the receipt of the resolution of their appeals as the case may be: Provided, That application for clearance has been filed and no action thereon has been made by the corresponding department or agency. Those who are not entitled to said benefits shall be paid a separation gratuity in the amount equivalent to one (1) month salary for every year of service. Such separation pay and retirement benefits shall have priority of payment out of the savings of the department or agency concerned. 23 On June 23, 1988, Benedicto Amasa and William Dionisio, customs examiners appointed by Commissioner Mison pursuant to the ostensible reorganization subject of this controversy, petitioned the Court to contest the validity of the statute. The petition is docketed as G.R. No. 83737.

On October 21, 1988, thirty-five more Customs officials whom the Civil Service Commission had ordered reinstated by its June 30,1988 Resolution filed their own petition to compel the Commissioner of Customs to comply with the said Resolution. The petition is docketed as G.R. No. 85335. On November 29, 1988, we resolved to consolidate all seven petitions. On the same date, we resolved to set the matter for hearing on January 12, 1989. At the said hearing, the parties, represented by their counsels (a) retired Justice Ruperto Martin; (b) retired Justice Lino Patajo. (c) former Dean Froilan Bacungan (d) Atty. Lester Escobar (e) Atty. Faustino Tugade and (f) Atty. Alexander Padilla, presented their arguments. Solicitor General Francisco Chavez argued on behalf of the Commissioner of Customs (except in G.R. 85335, in which he represented the Bureau of Customs and the Civil Service Commission). Former Senator Ambrosio Padilla also appeared and argued as amicus curiae Thereafter, we resolved to require the parties to submit their respective memoranda which they did in due time.
lwph1.t

There is no question that the administration may validly carry out a government reorganization insofar as these cases are concerned, the reorganization of the Bureau of Customs by mandate not only of the Provisional Constitution, supra, but also of the various Executive Orders decreed by the Chief Executive in her capacity as sole lawmaking authority under the 1986-1987 revolutionary government. It should also be noted that under the present Constitution, there is a recognition, albeit implied, that a government reorganization may be legitimately undertaken, subject to certain conditions. 24 The Court understands that the parties are agreed on the validity of a reorganization per se the only question being, as shall be later seen: What is the nature and extent of this government reorganization? The Court disregards the questions raised as to procedure, failure to exhaust administrative remedies, the standing of certain parties to sue, 25 and other technical objections, for two reasons, "[b]ecause of the demands of public interest, including the need for stability in the public service,"26 and because of the serious implications of these cases on the administration of the Philippine civil service and the rights of public servants. The urgings in G.R. Nos. 85335 and 85310, that the Civil Service Commission's Resolution dated June 30, 1988 had attained a character of finality for failure of Commissioner Mison to apply for judicial review or ask for reconsideration seasonalbly under Presidential Decree No. 807, 27 or under Republic Act No. 6656, 28 or under the Constitution, 29 are likewise rejected. The records show that the Bureau of Customs had until July 15, 1988 to ask for reconsideration or come to this Court pursuant to Section 39 of Presidential Decree No. 807. The records likewise show that the Solicitor General filed a motion for reconsideration on July 15, 1988.30 The Civil Service Commission issued its Resolution denying reconsideration on September 20, 1988; a copy of this Resolution was received by the Bureau on September 23, 1988.31 Hence the Bureau had until October 23, 1988 to elevate the matter on certiorari to this Court.32 Since the Bureau's petition was filed on October 20, 1988, it was filed on time. We reject, finally, contentions that the Bureau's petition (in G.R. 85310) raises no jurisdictional questions, and is therefore bereft of any basis as a petition for certiorari under Rule 65 of the Rules of Court. 33 We find that the questions raised in Commissioner Mison's petition (in G.R. 85310) are, indeed, proper for certiorari, if by "jurisdictional questions" we mean questions having to do with "an indifferent disregard of the law, arbitrariness and caprice, or omission to weigh pertinent considerations, a decision arrived at without rational deliberation, 34 as distinguished from questions that require "digging into the merits and unearthing errors of judgment 35 which is the office, on the other hand, of review under Rule 45 of the said Rules. What cannot be denied is the fact that the act of the Civil Service Commission of reinstating hundreds of Customs employees Commissioner Mison had separated, has implications not only

on the entire reorganization process decreed no less than by the Provisional Constitution, but on the Philippine bureaucracy in general; these implications are of such a magnitude that it cannot be said that assuming that the Civil Service Commission erred the Commission committed a plain "error of judgment" that Aratuc says cannot be corrected by the extraordinary remedy of certiorari or any special civil action. We reaffirm the teaching of Aratuc as regards recourse to this Court with respect to rulings of the Civil Service Commission which is that judgments of the Commission may be brought to the Supreme Court through certiorari alone, under Rule 65 of the Rules of Court. In Aratuc we declared: It is once evident from these constitutional and statutory modifications that there is a definite tendency to enhance and invigorate the role of the Commission on Elections as the independent constitutional body charged with the safeguarding of free, peaceful and honest elections. The framers of the new Constitution must be presumed to have definite knowledge of what it means to make the decisions, orders and rulings of the Commission "subject to review by the Supreme Court'. And since instead of maintaining that provision intact, it ordained that the Commission's actuations be instead 'brought to the Supreme Court on certiorari", We cannot insist that there was no intent to change the nature of the remedy, considering that the limited scope of certiorari, compared to a review, is well known in remedial law.36 We observe no fundamental difference between the Commission on Elections and the Civil Service Commission (or the Commission on Audit for that matter) in terms of the constitutional intent to leave the constitutional bodies alone in the enforcement of laws relative to elections, with respect to the former, and the civil service, with respect to the latter (or the audit of government accounts, with respect to the Commission on Audit). As the poll body is the "sole judge" 37 of all election cases, so is the Civil Service Commission the single arbiter of all controversies pertaining to the civil service. It should also be noted that under the new Constitution, as under the 1973 Charter, "any decision, order, or ruling of each Commission may be brought to the Supreme Court on certiorari," 38 which, as Aratuc tells us, "technically connotes something less than saying that the same 'shall be subject to review by the Supreme Court,' " 39 which in turn suggests an appeal by petition for review under Rule 45. Therefore, our jurisdiction over cases emanating from the Civil Service Commission is limited to complaints of lack or excess of jurisdiction or grave abuse of discretion tantamount to lack or excess of jurisdiction, complaints that justify certiorari under Rule 65. While Republic Act No. 6656 states that judgments of the Commission are "final and executory"40 and hence, unappealable, under Rule 65, certiorari precisely lies in the absence of an appeal. 41 Accordingly, we accept Commissioner Mison petition (G.R. No. 85310) which clearly charges the Civil Service Commission with grave abuse of discretion, a proper subject of certiorari, although it may not have so stated in explicit terms. As to charges that the said petition has been filed out of time, we reiterate that it has been filed seasonably. It is to be stressed that the Solicitor General had thirty days from September 23, 1988 (the date the Resolution, dated September 20,1988, of the Civil Service Commission, denying reconsideration, was received) to commence the instant certiorari proceedings. As we stated, under the Constitution, an aggrieved party has thirty days within which to challenge "any decision, order, or ruling" 42 of the Commission. To say that the period should be counted from the Solicitor's receipt of the main Resolution, dated June 30, 1988, is to say that he should not have asked for reconsideration But to say that is to deny him the right to contest (by a motion for reconsideration) any ruling, other than the main decision, when, precisely, the Constitution gives

him such a right. That is also to place him at a "no-win" situation because if he did not move for a reconsideration, he would have been faulted for demandingcertiorari too early, under the general rule that a motion for reconsideration should preface a resort to a special civil action. 43 Hence, we must reckon the thirty-day period from receipt of the order of denial. We come to the merits of these cases. G.R. Nos. 81954, 81967, 82023, and 85335: The Case for the Employees The petitioner in G.R. No. 81954, Cesar Dario was one of the Deputy Commissioners of the Bureau of Customs until his relief on orders of Commissioner Mison on January 26, 1988. In essence, he questions the legality of his dismiss, which he alleges was upon the authority of Section 59 of Executive Order No. 127, supra, hereinbelow reproduced as follows: SEC. 59. New Structure and Pattern. Upon approval of this Executive Order, the officers and employees of the Ministry shall, in a holdover capacity, continue to perform their respective duties and responsibilities and receive the corresponding salaries and benefits unless in the meantime they are separated from government service pursuant to Executive Order No. 17 (1986) or Article III of the Freedom Constitution. The new position structure and staffing pattern of the Ministry shall be approved and prescribed by the Minister within one hundred twenty (120) days from the approval of this Executive Order and the authorized positions created hereunder shall be filled with regular appointments by him or by the President, as the case may be. Those incumbents whose positions are not included therein or who are not reappointed shall be deemed separated from the service. Those separated from the service shall receive the retirement benefits to which they may be entitled under existing laws, rules and regulations. Otherwise, they shall be paid the equivalent of one month basic salary for every year of service, or the equivalent nearest fraction thereof favorable to them on the basis of highest salary received but in no case shall such payment exceed the equivalent of 12 months salary. No court or administrative body shall issue any writ of preliminary injunction or restraining order to enjoin the separation/replacement of any officer or employee effected under this Executive Order.44 a provision he claims the Commissioner could not have legally invoked. He avers that he could not have been legally deemed to be an "[incumbent] whose [position] [is] not included therein or who [is] not reappointed"45 to justify his separation from the service. He contends that neither the Executive Order (under the second paragraph of the section) nor the staffing pattern proposed by the Secretary of Finance 46 abolished the office of Deputy Commissioner of Customs, but, rather, increased it to three. 47 Nor can it be said, so he further maintains, that he had not been "reappointed" 48 (under the second paragraph of the section) because "[[r]eappointment therein presupposes that the position to which it refers is a new one in lieu of that which has been abolished or although an existing one, has absorbed that which has been abolished." 49 He claims, finally, that under the Provisional Constitution, the power to dismiss public officials without cause ended on February 25, 1987,50 and that thereafter, public officials enjoyed security of tenure under the provisions of the 1987 Constitution.51 Like Dario Vicente Feria, the petitioner in G.R. No. 81967, was a Deputy Commissioner at the Bureau until his separation directed by Commissioner Mison. And like Dario he claims that under the 1987 Constitution, he has acquired security of tenure and that he cannot be said to be covered by Section 59 of Executive Order No. 127, having been appointed on April 22, 1986 during the effectivity of the Provisional Constitution. He adds that under Executive Order No. 39,

"ENLARGING THE POWERS AND FUNCTIONS OF THE COMMISSIONER OF CUSTOMS,"52 the Commissioner of Customs has the power "[t]o appoint all Bureau personnel, except those appointed by the President," 53 and that his position, which is that of a Presidential appointee, is beyond the control of Commissioner Mison for purposes of reorganization. The petitioners in G.R. No. 82023, collectors and examiners in venous ports of the Philippines, say, on the other hand, that the purpose of reorganization is to end corruption at the Bureau of Customs and that since there is no finding that they are guilty of corruption, they cannot be validly dismissed from the service. The Case for Commissioner Mison In his comments, the Commissioner relies on this Court's resolution in Jose v. Arroyo54 in which the following statement appears in the last paragraph thereof: The contention of petitioner that Executive Order No. 127 is violative of the provision of the 1987 Constitution guaranteeing career civil service employees security of tenure overlooks the provisions of Section 16, Article XVIII (Transitory Provisions) which explicitly authorize the removal of career civil service employees "not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution." By virtue of said provision, the reorganization of the Bureau of Customs under Executive Order No. 127 may continue even after the ratification of the Constitution, and career civil service employees may be separated from the service without cause as a result of such reorganization.55 For this reason, Mison posits, claims of violation of security of tenure are allegedly no defense. He further states that the deadline prescribed by the Provisional Constitution (February 25, 1987) has been superseded by the 1987 Constitution, specifically, the transitory provisions thereof, 56 which allows a reorganization thereafter (after February 25, 1987) as this very Court has so declared in Jose v. Arroyo. Mison submits that contrary to the employees' argument, Section 59 of Executive Order No. 127 is applicable (in particular, to Dario and Feria in the sense that retention in the Bureau, under the Executive Order, depends on either retention of the position in the new staffing pattern or reappointment of the incumbent, and since the dismissed employees had not been reappointed, they had been considered legally separated. Moreover, Mison proffers that under Section 59 incumbents are considered on holdover status, "which means that all those positions were considered vacant." 57The Solicitor General denies the applicability of Palma-Fernandez v. De la Paz 58 because that case supposedly involved a mere transfer and not a separation. He rejects, finally, the force and effect of Executive Order Nos. 17 and 39 for the reason that Executive Order No. 17, which was meant to implement the Provisional Constitution, 59had ceased to have force and effect upon the ratification of the 1987 Constitution, and that, under Executive Order No. 39, the dismissals contemplated were "for cause" while the separations now under question were "not for cause" and were a result of government reorganize organization decreed by Executive Order No. 127. Anent Republic Act No. 6656, he expresses doubts on the constitutionality of the grant of retroactivity therein (as regards the reinforcement of security of tenure) since the new Constitution clearly allows reorganization after its effectivity. G.R. Nos. 85310 and 86241 The Position of Commissioner Mison Commissioner's twin petitions are direct challenges to three rulings of the Civil Service Commission: (1) the Resolution, dated June 30, 1988, reinstating the 265 customs employees above-stated; (2) the Resolution, dated September 20, 1988, denying reconsideration; and (3) the Resolution, dated November 16, 1988, reinstating five employees. The Commissioner's arguments are as follows:

1. The ongoing government reorganization is in the nature of a "progressive" 60 reorganization "impelled by the need to overhaul the entire government bureaucracy" 61 following the people power revolution of 1986; 2. There was faithful compliance by the Bureau of the various guidelines issued by the President, in particular, as to deliberation, and selection of personnel for appointment under the new staffing pattern; 3. The separated employees have been, under Section 59 of Executive Order No. 127, on mere holdover standing, "which means that all positions are declared vacant;" 62 4. Jose v. Arroyo has declared the validity of Executive Order No. 127 under the transitory provisions of the 1987 Constitution; 5. Republic Act No. 6656 is of doubtful constitutionality. The Ruling of the Civil Service Commission The position of the Civil Service Commission is as follows: 1. Reorganizations occur where there has been a reduction in personnel or redundancy of functions; there is no showing that the reorganization in question has been carried out for either purpose on the contrary, the dismissals now disputed were carried out by mere service of notices; 2. The current Customs reorganization has not been made according to Malaca;ang guidelines; information on file with the Commission shows that Commissioner Mison has been appointing unqualified personnel; 3. Jose v. Arroyo, in validating Executive Order No. 127, did not countenance illegal removals; 4. Republic Act No. 6656 protects security of tenure in the course of reorganizations. The Court's ruling Reorganization, Fundamental Principles of. I. The core provision of law involved is Section 16 Article XVIII, of the 1987 Constitution. We quote: Sec. 16. Career civil service employees separated from the service not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution shag be entitled to appropriate separation pay and to retirement and other benefits accruing to them under the laws of general application in force at the time of their separation. In lieul thereof, at the option of the employees, they may be considered for employment in the Government or in any of its subdivisions, instrumentalities, or agencies, including government-owned or controlled corporations and their subsidiaries. This provision also applies to career officers whose resignation, tendered in line with the existing policy, had been accepted. 63 The Court considers the above provision critical for two reasons: (1) It is the only provision in so far as it mentions removals not for cause that would arguably support the challenged dismissals by mere notice, and (2) It is the single existing law on reorganization after the ratification of the 1987 Charter, except Republic Act No. 6656, which came much later, on June

10, 1988. [Nota been Executive Orders No. 116 (covering the Ministry of Agriculture & Food), 117 (Ministry of Education, Culture & Sports), 119 (Health), 120 (Tourism), 123 (Social Welfare & Development), 124 (Public Works & Highways), 125 transportation & Communications), 126 (Labor & Employment), 127 (Finance), 128 (Science & Technology), 129 (Agrarian Reform), 131 (Natural Resources), 132 (Foreign Affairs), and 133 (Trade & Industry) were all promulgated on January 30,1987, prior to the adoption of the Constitution on February 2, 1987].64 It is also to be observed that unlike the grants of power to effect reorganizations under the past Constitutions, the above provision comes as a mere recognition of the right of the Government to reorganize its offices, bureaus, and instrumentalities. Under Section 4, Article XVI, of the 1935 Constitution: Section 4. All officers and employees in the existing Government of the Philippine Islands shall continue in office until the Congress shall provide otherwise, but all officers whose appointments are by this Constitution vested in the President shall vacate their respective office(s) upon the appointment and qualification of their successors, if such appointment is made within a period of one year from the date of the inauguration of the Commonwealth of the Philippines. 65 Under Section 9, Article XVII, of the 1973 Charter: Section 9. All officials and employees in the existing Government of the Republic of the Philippines shall continue in office until otherwise provided by law or decreed by the incumbent President of the Philippines, but all officials whose appointments are by this Constitution vested in the Prime Minister shall vacate their respective offices upon the appointment and qualification of their successors. 66 The Freedom Constitution is, as earlier seen, couched in similar language: SECTION 2. All elective and appointive officials and employees under the 1973 Constitution shall continue in office until otherwise provided by proclamation or executive order or upon the appointment and qualification of their successors, if such is made within a period of one year from February 25, 1986.67 Other than references to "reorganization following the ratification of this Constitution," there is no provision for "automatic" vacancies under the 1987 Constitution. Invariably, transition periods are characterized by provisions for "automatic" vacancies. They are dictated by the need to hasten the passage from the old to the new Constitution free from the "fetters" of due process and security of tenure. At this point, we must distinguish removals from separations arising from abolition of office (not by virtue of the Constitution) as a result of reorganization carried out by reason of economy or to remove redundancy of functions. In the latter case, the Government is obliged to prove good faith.68 In case of removals undertaken to comply with clear and explicit constitutional mandates, the Government is not hard put to prove anything, plainly and simply because the Constitution allows it. Evidently, the question is whether or not Section 16 of Article XVIII of the 1987 Constitution is a grant of a license upon the Government to remove career public officials it could have validly done under an "automatic" vacancy-authority and to remove them without rhyme or reason. As we have seen, since 1935, transition periods have been characterized by provisions for "automatic" vacancies. We take the silence of the 1987 Constitution on this matter as a restraint upon the Government to dismiss public servants at a moment's notice.

What is, indeed, apparent is the fact that if the present Charter envisioned an "automatic" vacancy, it should have said so in clearer terms, as its 1935, 1973, and 1986 counterparts had so stated. The constitutional "lapse" means either one of two things: (1) The Constitution meant to continue the reorganization under the prior Charter (of the Revolutionary Government), in the sense that the latter provides for "automatic" vacancies, or (2) It meant to put a stop to those 'automatic" vacancies. By itself, however, it is ambiguous, referring as it does to two stages of reorganization the first, to its conferment or authorization under Proclamation No. 3 (Freedom Charter) and the second, to its implementation on its effectivity date (February 2, 1987). But as we asserted, if the intent of Section 16 of Article XVIII of the 1987 Constitution were to extend the effects of reorganize tion under the Freedom Constitution, it should have said so in clear terms. It is illogical why it should talk of two phases of reorganization when it could have simply acknowledged the continuing effect of the first reorganization.
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Second, plainly the concern of Section 16 is to ensure compensation for victims" of constitutional revamps whether under the Freedom or existing Constitution and only secondarily and impliedly, to allow reorganization. We turn to the records of the Constitutional Commission: INQUIRY OF MR. PADILLA On the query of Mr. Padilla whether there is a need for a specific reference to Proclamation No. 3 and not merely state "result of the reorganization following the ratification of this Constitution', Mr. Suarez, on behalf of the Committee, replied that it is necessary, inasmuch as there are two stages of reorganization covered by the Section. Mr. Padilla pointed out that since the proposal of the Commission on Government Reorganization have not been implemented yet, it would be better to use the phrase "reorganization before or after the ratification of the Constitution' to simplify the Section. Mr. Suarez instead suggested the phrase "as a result of the reorganization effected before or after the ratification of the Constitution' on the understanding that the provision would apply to employees terminated because of the reorganization pursuant to Proclamation No. 3 and even those affected by the reorganization during the Marcos regime. Additionally, Mr. Suarez pointed out that it is also for this reason that the Committee specified the two Constitutions the Freedom Constitution and the 1986 [1987] Constitution. 69 Simply, the provision benefits career civil service employees separated from the service. And the separation contemplated must be due to or the result of (1) the reorganization pursuant to Proclamation No. 3 dated March 25, 1986, (2) the reorganization from February 2, 1987, and (3) the resignations of career officers tendered in line with the existing policy and which resignations have been accepted. The phrase "not for cause" is clearly and primarily exclusionary, to exclude those career civil service employees separated "for cause." In other words, in order to be entitled to the benefits granted under Section 16 of Article XVIII of the Constitution of 1987, two requisites, one negative and the other positive, must concur, to wit: 1. the separation must not be for cause, and 2. the separation must be due to any of the three situations mentioned above. By its terms, the authority to remove public officials under the Provisional Constitution ended on February 25, 1987, advanced by jurisprudence to February 2, 1987. 70 It Can only mean, then, that whatever reorganization is taking place is upon the authority of the present Charter, and necessarily, upon the mantle of its provisions and safeguards. Hence, it can not be legitimately stated that we are merely continuing what the revolutionary Constitution of the Revolutionary Government had started. We are through with reorganization under the Freedom Constitution

the first stage. We are on the second stage that inferred from the provisions of Section 16 of Article XVIII of the permanent basic document. This is confirmed not only by the deliberations of the Constitutional Commission, supra, but is apparent from the Charter's own words. It also warrants our holding in Esguerra and PalmaFernandez, in which we categorically declared that after February 2, 1987, incumbent officials and employees have acquired security of tenure, which is not a deterrent against separation by reorganization under the quondam fundamental law. Finally, there is the concern of the State to ensure that this reorganization is no "purge" like the execrated reorganizations under martial rule. And, of course, we also have the democratic character of the Charter itself. Commissioner Mison would have had a point, insofar as he contends that the reorganization is open-ended ("progressive"), had it been a reorganization under the revolutionary authority, specifically of the Provisional Constitution. For then, the power to remove government employees would have been truly wide ranging and limitless, not only because Proclamation No. 3 permitted it, but because of the nature of revolutionary authority itself, its totalitarian tendencies, and the monopoly of power in the men and women who wield it. What must be understood, however, is that notwithstanding her immense revolutionary powers, the President was, nevertheless, magnanimous in her rule. This is apparent from Executive Order No. 17, which established safeguards against the strong arm and ruthless propensity that accompanies reorganizations notwithstanding the fact that removals arising therefrom were "not for cause," and in spite of the fact that such removals would have been valid and unquestionable. Despite that, the Chief Executive saw, as we said, the "unnecessary anxiety and demoralization" in the government rank and file that reorganization was causing, and prescribed guidelines for personnel action. Specifically, she said on May 28, 1986: WHEREAS, in order to obviate unnecessary anxiety and demoralization among the deserving officials and employees, particularly in the career civil service, it is necessary to prescribe the rules and regulations for implementing the said constitutional provision to protect career civil servants whose qualifications and performance meet the standards of service demanded by the New Government, and to ensure that only those found corrupt, inefficient and undeserving are separated from the government service; 71 Noteworthy is the injunction embodied in the Executive Order that dismissals should be made on the basis of findings of inefficiency, graft, and unfitness to render public service.* The President's Memorandum of October 14, 1987 should furthermore be considered. We quote, in part: Further to the Memorandum dated October 2, 1987 on the same subject, I have ordered that there will be no further layoffs this year of personnel as a result of the government reorganization. 72 Assuming, then, that this reorganization allows removals "not for cause" in a manner that would have been permissible in a revolutionary setting as Commissioner Mison so purports, it would seem that the Commissioner would have been powerless, in any event, to order dismissals at the Customs Bureau left and right. Hence, even if we accepted his "progressive" reorganization theory, he would still have to come to terms with the Chief Executive's subsequent directives moderating the revolutionary authority's plenary power to separate government officials and employees. Reorganization under the 1987 Constitution, Nature, Extent, and Limitations of; Jose v. Arroyo, clarified.

The controversy seems to be that we have, ourselves, supposedly extended the effects of government reorganization under the Provisional Constitution to the regime of the 1987 Constitution. Jose v. Arroyo73 is said to be the authority for this argument. Evidently, if Arroyo indeed so ruled, Arroyo would be inconsistent with the earlier pronouncement of Esguerra and the later holding of Palma-Fernandez. The question, however, is: Did Arroyo, in fact, extend the effects of reorganization under the revolutionary Charter to the era of the new Constitution? There are a few points about Arroyo that have to be explained. First, the opinion expressed therein that "[b]y virtue of said provision the reorganization of the Bureau of Customs under Executive Order No. 127 may continue even after the ratification of this constitution and career civil service employees may be separated from the service without cause as a result of such reorganization" 74 is in the nature of an obiter dictum. We dismissed Jose's petition 75 primarily because it was "clearly premature, speculative, and purely anticipatory, based merely on newspaper reports which do not show any direct or threatened injury," 76 it appearing that the reorganization of the Bureau of Customs had not been, then, set in motion. Jose therefore had no cause for complaint, which was enough basis to dismiss the petition. The remark anent separation "without cause" was therefore not necessary for the disposition of the case. In Morales v. Parades,77 it was held that an obiter dictum "lacks the force of an adjudication and should not ordinarily be regarded as such."78 Secondly, Arroyo is an unsigned resolution while Palma Fernandez is a full-blown decision, although both are en banc cases. While a resolution of the Court is no less forceful than a decision, the latter has a special weight. Thirdly, Palma-Fernandez v. De la Paz comes as a later doctrine. (Jose v. Arroyo was promulgated on August 11, 1987 while Palma-Fernandez was decided on August 31, 1987.) It is well-established that a later judgment supersedes a prior one in case of an inconsistency. As we have suggested, the transitory provisions of the 1987 Constitution allude to two stages of the reorganization, the first stage being the reorganization under Proclamation No. 3 which had already been consummated the second stage being that adverted to in the transitory provisions themselves which is underway. Hence, when we spoke, in Arroyo, of reorganization after the effectivity of the new Constitution, we referred to the second stage of the reorganization. Accordingly, we cannot be said to have carried over reorganization under the Freedom Constitution to its 1987 counterpart. Finally, Arroyo is not necessarily incompatible with Palma-Fernandez (or Esguerra). As we have demonstrated, reorganization under the aegis of the 1987 Constitution is not as stern as reorganization under the prior Charter. Whereas the latter, sans the President's subsequently imposed constraints, envisioned a purgation, the same cannot be said of the reorganization inferred under the new Constitution because, precisely, the new Constitution seeks to usher in a democratic regime. But even if we concede ex gratia argumenti that Section 16 is an exception to due process and no-removal-"except for cause provided by law" principles enshrined in the very same 1987 Constitution, 79 which may possibly justify removals "not for cause," there is no contradiction in terms here because, while the former Constitution left the axe to fall where it might, the present organic act requires that removals "not for cause" must be as a result of reorganization. As we observed, the Constitution does not provide for "automatic" vacancies. It must also pass the test of good faith a test not obviously required under the revolutionary government formerly prevailing, but a test well-established in democratic societies and in this government under a democratic Charter. When, therefore, Arroyo permitted a reorganization under Executive Order No. 127 after the ratification of the 1987 Constitution, Arroyo permitted a reorganization provided that it is done in good faith. Otherwise, security of tenure would be an insuperable implement. 80

Reorganizations in this jurisdiction have been regarded as valid provided they are pursued in good faith. 81 As a general rule, a reorganization is carried out in "good faith" if it is for the purpose of economy or to make bureaucracy more efficient. In that event, no dismissal (in case of a dismissal) or separation actually occurs because the position itself ceases to exist. And in that case, security of tenure would not be a Chinese wall. Be that as it may, if the "abolition," which is nothing else but a separation or removal, is done for political reasons or purposely to defeat sty of tenure, or otherwise not in good faith, no valid "abolition' takes place and whatever "abolition' is done, is void ab initio. There is an invalid "abolition" as where there is merely a change of nomenclature of positions, 82 or where claims of economy are belied by the existence of ample funds. 83 It is to be stressed that by predisposing a reorganization to the yardstick of good faith, we are not, as a consequence, imposing a "cause" for restructuring. Retrenchment in the course of a reorganization in good faith is still removal "not for cause," if by "cause" we refer to "grounds" or conditions that call for disciplinary action.** Good faith, as a component of a reorganization under a constitutional regime, is judged from the facts of each case. However, under Republic Act No. 6656, we are told: SEC. 2. No officer or employee in the career service shall be removed except for a valid cause and after due notice and hearing. A valid cause for removal exists when, pursuant to a bona fide reorganization, a position has been abolished or rendered redundant or there is a need to merge, divide, or consolidate positions in order to meet the exigencies of the service, or other lawful causes allowed by the Civil Service Law. The existence of any or some of the following circumstances may be considered as evidence of bad faith in the removals made as a result of reorganization, giving rise to a claim for reinstatement or reappointment by an aggrieved party: (a) Where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) Where an office is abolished and another performing substantially the same functions is created; (c) Where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) Where there is a reclassification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices; (e) Where the removal violates the order of separation provided in Section 3 hereof. 84 It is in light hereof that we take up questions about Commissioner Mison's good faith, or lack of it. Reorganization of the Bureau of Customs, Lack of Good Faith in. The Court finds that after February 2, 1987 no perceptible restructuring of the Customs hierarchy except for the change of personnel has occurred, which would have justified (an things being equal) the contested dismisses. The contention that the staffing pattern at the Bureau (which would have furnished a justification for a personnel movement) is the same s pattern prescribed by Section 34 of Executive Order No. 127 already prevailing when Commissioner Mison took over the Customs helm, has not been successfully contradicted 85There is no showing that legitimate structural changes have been made or a reorganization actually undertaken, for that matter at the Bureau since Commissioner Mison assumed office, which would have validly prompted him to hire and fire employees. There can therefore be no actual reorganization to speak of, in the sense, say, of reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy of functions, but a revamp of personnel pure and simple. The records indeed show that Commissioner Mison separated about 394 Customs personnel but replaced them with 522 as of August 18, 1988. 86 This betrays a clear intent to "pack" the Bureau of Customs. He did so, furthermore, in defiance of the President's directive to halt further layoffs

as a consequence of reorganization. 87Finally, he was aware that layoffs should observe the procedure laid down by Executive Order No. 17. We are not, of course, striking down Executive Order No. 127 for repugnancy to the Constitution. While the act is valid, still and all, the means with which it was implemented is not. 88 Executive Order No. 127, Specific Case of. With respect to Executive Order No. 127, Commissioner Mison submits that under Section 59 thereof, "[t]hose incumbents whose positions are not included therein or who are not reappointed shall be deemed separated from the service." He submits that because the 394 removed personnel have not been "reappointed," they are considered terminated. To begin with, the Commissioner's appointing power is subject to the provisions of Executive Order No. 39. Under Executive Order No. 39, the Commissioner of Customs may "appoint all Bureau personnel, except those appointed by the President." 89 Accordingly, with respect to Deputy Commissioners Cesar Dario and Vicente Feria, Jr., Commissioner Mison could not have validly terminated them, they being Presidential appointees. Secondly, and as we have asserted, Section 59 has been rendered inoperative according to our holding in Palma-Fernandez. That Customs employees, under Section 59 of Executive Order No. 127 had been on a mere holdover status cannot mean that the positions held by them had become vacant. In PalmaFernandez, we said in no uncertain terms: The argument that, on the basis of this provision, petitioner's term of office ended on 30 January 1987 and that she continued in the performance of her duties merely in a hold over capacity and could be transferred to another position without violating any of her legal rights, is untenable. The occupancy of a position in a hold-over capacity was conceived to facilitate reorganization and would have lapsed on 25 February 1987 (under the Provisional Constitution), but advanced to February 2, 1987 when the 1987 Constitution became effective (De Leon. et al., vs. Hon. Benjamin B. Esquerra, et. al., G.R. No. 78059, 31 August 1987). After the said date the provisions of the latter on security of tenure govern. 90 It should be seen, finally, that we are not barring Commissioner Mison from carrying out a reorganization under the transitory provisions of the 1987 Constitution. But such a reorganization should be subject to the criterion of good faith. Resume. In resume, we restate as follows: 1. The President could have validly removed government employees, elected or appointed, without cause but only before the effectivity of the 1987 Constitution on February 2, 1987 (De Leon v. Esguerra, supra; Palma-Fernandez vs. De la Paz, supra); in this connection, Section 59 (on non-reappointment of incumbents) of Executive Order No. 127 cannot be a basis for termination; 2. In such a case, dismissed employees shall be paid separation and retirement benefits or upon their option be given reemployment opportunities (CONST. [1987], art. XVIII, sec. 16; Rep. Act No. 6656, sec. 9);

3. From February 2, 1987, the State does not lose the right to reorganize the Government resulting in the separation of career civil service employees [CONST. (1987), supra] provided, that such a reorganization is made in good faith. (Rep. Act No. 6656, supra.) G.R. No. 83737 This disposition also resolves G.R. No. 83737. As we have indicated, G.R. No. 83737 is a challenge to the validity of Republic Act No. 6656. In brief, it is argued that the Act, insofar as it strengthens security of tenure 91 and as far as it provides for a retroactive effect, 92 runs counter to the transitory provisions of the new Constitution on removals not for cause. It can be seen that the Act, insofar as it provides for reinstatament of employees separated without "a valid cause and after due notice and hearing" 93 is not contrary to the transitory provisions of the new Constitution. The Court reiterates that although the Charter's transitory provisions mention separations "not for cause," separations thereunder must nevertheless be on account of a valid reorganization and which do not come about automatically. Otherwise, security of tenure may be invoked. Moreover, it can be seen that the statute itself recognizes removals without cause. However, it also acknowledges the possibility of the leadership using the artifice of reorganization to frustrate security of tenure. For this reason, it has installed safeguards. There is nothing unconstitutional about the Act. We recognize the injury Commissioner Mison's replacements would sustain. We also commisserate with them. But our concern is the greater wrong inflicted on the dismissed employees on account of their regal separation from the civil service. WHEREFORE, THE RESOLUTIONS OF THE CIVIL SERVICE COMMISSION, DATED JUNE 30, 1988, SEPTEMBER 20, 1988, NOVEMBER 16, 1988, INVOLVED IN G.R. NOS. 85310, 85335, AND 86241, AND MAY 8, 1989, INVOLVED IN G.R. NO. 85310, ARE AFFIRMED. THE PETITIONS IN G.R. NOS. 81954, 81967, 82023, AND 85335 ARE GRANTED. THE PETITIONS IN G.R. NOS. 83737, 85310 AND 86241 ARE DISMISSED. THE COMMISSIONER OF CUSTOMS IS ORDERED TO REINSTATE THE EMPLOYEES SEPARATED AS A RESULT OF HIS NOTICES DATED JANUARY 26, 1988. THE EMPLOYEES WHOM COMMISSIONER MISON MAY HAVE APPOINTED AS REPLACEMENTS ARE ORDERED TO VACATE THEIR POSTS SUBJECT TO THE PAYMENT OF WHATEVER BENEFITS THAT MAY BE PROVIDED BY LAW. NO COSTS. IT IS SO ORDERED. Gutierrez, Jr., Paras, Gancayco, Bidin, Cortes, Gri;o-Aquino and Medialdea, JJ., concur. Padilla, J., took no part.

Separate Opinions CRUZ, J., concurring:

I concur with the majority view so ably presented by Mr. Justice Abraham F. Sarmiento. While additional comments may seem superfluous in view of the exhaustiveness of his ponencia, I nevertheless offer the following brief observations for whatever they may be worth. Emphasizing Article XVII, Section 16 of the Constitution, the dissenting opinion considers the ongoing government reorganization valid because it is merely a continuation of the reorganization begun during the transition period. The reason for this conclusion is the phrase "and the reorganization following the ratification of the Constitution," that is to say, after February 2, 1987, appearing in the said provision. The consequence (and I hope I have not misread it) is that the present reorganization may still be undertaken with the same "absoluteness" that was allowed the revolutionary reorganization although the Freedom Constitution is no longer in force. Reorganization of the government may be required by the legislature even independently of specific constitutional authorization, as in the case, for example, of R.A. No. 51 and B.P. No. 129. Being revolutionary in nature, the reorganization decreed by Article III of the Freedom Constitution was unlimited as to its method except only as it was later restricted by President Aquino herself through various issuances, particularly E.O. No. 17. But this reorganization, for all its permitted summariness, was not indefinite. Under Section 3 of the said Article III, it was allowed only up to February 29,1987 (which we advanced to February 2, 1987, when the new Constitution became effective). The clear implication is that any government reorganization that may be undertaken thereafter must be authorized by the legislature only and may not be allowed the special liberties and protection enjoyed by the revolutionary reorganization. Otherwise, there would have been no necessity at all for the time limitation expressly prescribed by the Freedom Constitution. I cannot accept the view that Section 16 is an authorization for the open-ended reorganization of the government "following the ratification of the Constitution." I read the provision as merely conferring benefits deservedly or not on persons separated from the government as a result of the reorganization of the government, whether undertaken during the transition period or as a result of a law passed thereafter. What the grants is privileges to the retirees, not power to the provision government. It is axiomatic that grants of power are not lightly inferred, especially if these impinge on individual rights, and I do not see why we should depart from this rule. To hold that the present reorganization is a continuation of the one begun during the transition period is to recognize the theory of the public respondent that all officers and employees not separated earlier remain in a hold-over capacity only and so may be replaced at any time even without cause. That is a dangerous proposition that threatens the security and stability of every civil servant in the executive department. What is worse is that this situation may continue indefinitely as the claimed "progressive" reorganization has no limitation as to time. Removal imports the forcible separation of the incumbent before the expiration of his term and can be done only for cause as provided by law. Contrary to common belief, a reorganization does not result in removal but in a different mode of terminating official relations known as abolition of the office (and the security of tenure attached thereto.) The erstwhile holder of the abolished office cannot claim he has been removed without cause in violation of his constitutional security of tenure. The reason is that the right itself has disappeared with the abolished office as an accessory following the principal. (Ocampo v. Sec. of Justice, 51 O.G. 147; De la Llana v. Alba, 112 SCRA 294; Manalang v. Quitoriano, 94 Phil. 903.) This notwithstanding, the power to reorganize is not unlimited. It is essential that it be based on a valid purpose, such as the promotion of efficiency and economy in the government through a pruning of offices or the streamlining of their functions. (Cervantes v. Auditor-General, 91 Phil. 359.) Normally, a reorganization cannot be validly undertaken as a means of purging the undesirables for this would be a removal in disguise undertaken enmasse to circumvent the constitutional requirement of legal cause. (Eradication of graft and corruption was one of the

expressed purposes of the revolutionary organization, but this was authorized by the Freedom Constitution itself.) In short, a reorganization, to be valid, must be done in good faith. (Urgelio v. Osmena, 9 SCRA 317; Cuneta v. Court of Appeals, 1 SCRA 663; Carino v. ACCFA, 18 SCRA 183.) A mere recitation no matter how lengthy of the directives, guidelines, memoranda, etc. issued by the government and the action purportedly taken thereunder does not by itself prove good faith. We know only too well that these instructions, for all their noble and sterile purposes, are rarely followed in their actual implementation. The reality in this case, as the majority opinion has pointed out and as clearly established in the hearing we held, is that the supposed reorganization was undertaken with an eye not to achieving the avowed objectives but to accommodating new appointees at the expense of the dislodged petitioners. That was also the finding of the Civil Service Commission, to which we must accord a becoming respect as the constitutional office charged with the protection of the civil service from the evils of the spoils system. The present administration deserves full support in its desire to improve the civil service, but this objective must be pursued in a manner consistent with the Constitution. This praiseworthy purpose cannot be accomplished by an indiscriminate reorganization that will sweep in its wake the innocent along with the redundant and inept, for the benefit of the current favorites. MELENCIO-HERRERA, J., dissenting: The historical underpinnings of Government efforts at reorganization hark back to the people power phenomenon of 22-24 February 1986, and Proclamation No. 1 of President Corazon C. Aquino, issued on 25 February 1986, stating in no uncertain terms that "the people expect a reorganization of government." In its wake followed Executive Order No. 5, issued on 12 March 1986, "Creating a Presidential Commission on Government Reorganization," with the following relevant provisions: WHEREAS, there is need to effect the necessary and proper changes in the organizational and functional structures of the national and local governments, its agencies and instrumentalities, including government-owned and controlled corporations and their subsidiaries, in order to promote economy, efficiency and effectiveness in the delivery of public services xxx xxx xxx

Section 2. The functional jurisdiction of the PCGR shall encompass, as necessary, the reorganization of the national and local governments, its agencies and instrumentalities including government-owned or controlled corporations and their subsidiaries. xxx xxx xxx (Emphasis supplied)

Succeeding it was Proclamation No. 3, dated 25 March 1986, also known as the Freedom Constitution, declaring, in part, in its Preamble as follows: WHEREAS, the direct mandate of the people as manifested by their extraordinary action demands the complete reorganization of the government, ... (Emphasis supplied) and pertinently providing: ARTICLE II

Section I xxx xxx xxx

The President shall give priority to measures to achieve the mandate of the people to: (a) Completely reorganize the government and eradicate unjust and oppressive structures, and all iniquitous vestiges of the previous regime;" (Emphasis supplied) xxx xxx xxx

ARTICLE III GOVERNMENT REORGANIZATION Section 2. All elective and appointive officials and employees under the 1973 Constitution shall continue in office until otherwise provided by proclamation or executive order or upon the designation or appointment and qualification of their successors, if such is made within a period of one year from February 25, 1986. Section 3. Any public office or employee separated from the service as a result of the reorganization effected under this Proclamation shall, if entitled under the laws then in force, receive the retirement and other benefits accruing thereunder. (Emphasis ours) On 28 May 1986, Executive Order No. 17 was issued "Prescribing Rules and Regulations for the Implementation of Section 2, Article III of the Freedom Constitution' providing, inter alia, as follows: Section 1. In the course of implementing Article III, Section 2 of the Freedom Constitution, the Head of each Ministry shall see to it that the separation or replacement of officers and employees is made only for justifiable reasons, to prevent indiscriminate dismissal, of personnel in the career civil service whose qualifications and performance meet the standards of public service of the New Government. xxx xxx xxx

The Ministry concerned shall adopt its own rules and procedures for the review and assessment of its own personnel, including the identification of sensitive positions which require more rigid assessment of the incumbents, and shall complete such review/assessment as expeditiously as possible but not later than February 24, 1987 to prevent undue demoralization in the public service. Section 2. The Ministry Head concerned, on the basis of such review and assessment shall determine who shall be separated from the service. Thereafter, he shall issue to the official or employee concerned anotice of separation which shall indicate therein the reason/s or ground /s for such separation and the fact that the separated official or employee has the right to file a petition for reconsideration pursuant to this Order. Separation from the service shall be effective upon receipt of such notice, either personally by the official or employee concerned or on his behalf by a person of sufficient discretion. Section 3. The following shall be the grounds for separation/ replacement of personnel: 1. Existence of a case for summary dismissal pursuant to Section 40 of the Civil Service Law;

2. Existence of a probable cause for violation of the Anti-Graft and Corrupt Practice Act as determined by the Ministry Head concerned; 3. Gross incompetence or inefficiency in the discharge of functions; 4. Misuse of Public office for partisan political purposes; 5. Any other analogous ground showing that the incumbent is unfit to remain in the service or his separation/replacement is in the interest of the service. Section 11. This Executive Order shall not apply to elective officials or those designated to replace them, presidential appointees, casual and contractual employees, or officials and employees removed pursuant to disciplinary proceedings under the Civil Service Law and rules, and to those laid off as a result of the reorganization undertaken pursuant to Executive Order No. 5. (Emphasis supplied) On 6 August 1986, Executive Order No. 39 was issued by the President "Enlarging the Powers and Functions of the Commissioner of Customs", as follows: xxx xxx xxx

SECTION 1. In addition to the powers and functions of the Commissioner of Customs, he is hereby authorized, subject to the Civil Service Law and its implementing rules and regulations: a) To appoint all Bureau personnel, except those appointed by the President; b) To discipline, suspend, dismiss or otherwise penalize erring Bureau officers and employees; c) To act on all matters pertaining to promotion, transfer, detail, reassignment, reinstatement, reemployment and other personnel action, involving officers and employees of the Bureau of Customs. xxx xxx xxx

On 30 January 1987, Executive Order No. 127 was issued "Reorganizing the Ministry of Finance." Similar Orders, approximately thirteen (13) in all, 1 were issued in respect of the other executive departments. The relevant provisions relative to the Bureau of Customs read: RECALLING that the reorganization of the government is mandated expressly in Article II, Section l(a) and Article III of the Freedom Constitution; HAVING IN MIND that pursuant to Executive Order No. 5 (1986), it is directed that the necessary and proper changes in the organizational and functional structures of the government, its agencies and instrumentalities, be effected in order to promote efficiency and effectiveness in the delivery of public services; BELIEVING that it is necessary to reorganize the Ministry of Finance to make it more capable and responsive, organizationally and functionally, in its primary mandate of judiciously generating and efficiently managing the financial resources of the Government, its subdivisions and instrumentalities in order to attain the socio-economic objectives of the national development programs.

xxx

xxx

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SEC. 2. Reorganization. The Ministry of Finance, hereinafter referred to as Ministry, is hereby reorganized, structurally and functionally, in accordance with the provisions of this Executive Order. SEC. 33. Bureau of Customs. ... Executive Order No. 39 dated 6 August 1986 which grants autonomy to the Commissioner of Customs in matters of appointment and discipline of Customs personnel shall remain in effect. SEC. 55. Abolition of Units Integral to Ministry. All units not included in the structural organization as herein provided and all positions thereof are hereby deemed abolished. ... Their personnel shall be entitled to the benefits provided in the second paragraph of Section 59 hereof. SEC. 59. New Structure and Pattern. Upon approval of this Executive Order, the officers and employees of the Ministry shall, in a holdover capacity, continue to perform their respective duties and responsibilities and receive the corresponding salaries and benefits unless in the meantime they are separated from government service pursuant to executive Order No. 17 (1986) or article III of the Freedom Constitution. The new position structure and staffing pattern of the ministry shall be approved and prescribed by the Minister within one hundred twenty (120) days from the approval of this Executive Order and the authorized positions created hereunder shall be filled with regular appointments by him or by the President, as the case may be. Those incumbents whose positions are not included therein or who are not reappointed shall be deemed separated from the service. Those separated from the service shall receive the retirement benefits to which they may be entitled under the existing laws, rules and regulations. Otherwise, they shall be paid the equivalent of one month basic salary for every year of service or the equivalent nearest fraction thereof favorable to them on the basis of highest salary received, but in no case shall such payment exceed the equivalent of 12 months salary. No court or administrative body shall issue any writ or preliminary junction or restraining order to enjoin the separation/replacement of any officer or employee affected under this Executive Order. Section 67 All laws, ordinances, rules, regulations and other issuances or parts thereof, which are inconsistent with this Executive Order, are hereby repealed or modified accordingly. xxx xxx xxx (Emphasis ours)

On 2 February 1987, the present Constitution took effect (De Leon, et al., vs. Esguerra, G.R. No. 78059, August 31, 1987153 SCRA 602). Reorganization in the Government service pursuant to Proclamation No. 3, supra, was provided for in its Section 16, Article XVIII entitled Transitory Provisions, reading: Section 16. Career civil service employees separated from the service not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution shall be entitled to appropriate separation pay and to retirement and other benefits accruing to them under the laws of general application in force at the time of their separation. In lieu thereof, at the option of the employees, they may be considered for employment in the Government

or in any of its subdivisions, instrumentalities, or agencies, including government owned or controlled corporations and their subsidiaries. Ms provision also applies to career officers whose resignation, tendered in line with the existing policy, has been accepted. On 24 May 1987 the then Commissioner of Customs, Alexander A. Padilla, transmitted to the Department of Finance for approval the proposed "position structure and staffing pattern" of the Bureau of Customs. Said Department gave its imprimatur. Thereafter, the staffing pattern was transmitted to and approved by the Department of Budget and Management on 7 September 1987 for implementation. Under the old staffing pattern, there were 7,302 positions while under the new staffing pattern, there are 6,530 positions CSC Resolution in CSC Case No. 1, dated 20 September 1988, pp. 3-4). On 22 September 1987, Salvador M. Mison assumed office as Commissioner of Customs. On 2 October 1987 "Malacanang Memorandum Re: Guidelines on the Implementation of Reorganization Executive Orders" was issued reading, insofar as revelant to these cases, as follows: It is my concern that ongoing process of government reorganization be conducted in a manner that is expeditious, as well as sensitive to the dislocating consequences arising from specific personnel decisions. The entire process of reorganization, and in particular the process of separation from service, must be carried out in the most humane manner possible. For this purpose, the following guidelines shall be strictly followed: 1. By October 21, 1987, all employees covered by the Executive Orders for each agency on reorganization shall be: a. informed of their reappointment or b. offered another position in the same department/ agency or c. informed of their termination. 2. In the event of an offer for a lower position, there will be no reduction in the salary. xxx xxx xxx 4. Each department/agency shall constitute a Reorganization Appeals Board at the central office, on or before October 21, 1987, to review or reconsider appeals or complaints relative to reorganization. All cases submitted to the Boards shall be resolved subject to the following guidelines: a. publication or posting of the appeal procedure promulgated by the Department Secretary; b. adherence to due process; c. disposition within 30 days from submission of the case; d written notification of the action taken and the grounds thereof.

Action by the Appeals Review Board does not preclude appeal to the Civil Service Commission. 5. Placement in the new staffing pattern of incumbent personnel shall be completed prior to the hiring of new personnel, if any. xxx xxx xxx (Emphasis ours)

On 25 November 1987 Commissioner Mison wrote the President requesting a grace period until the end of February 1988 within which to completely undertake the reorganization of the Bureau of Customs pursuant to Executive Order No. 127 dated 30 January 1987. Said request was granted in a letter-reply by Executive Secretary Catalino Macaraig, Jr., dated 22 December 1987. On 6 January 1988, within the extended period requested, Bureau of Customs Memorandum "Re: Guidelines on the Implementation of Reorganization Executive Orders" was issued in the same tenor as the Malacanang Memorandum of 2 October 1987, providing inter alia: To effectively implement the reorganization at the Bureau of Customs, particularly in the selection and placement of personnel, and insure that the best qualified and most competent personnel in the career service are retained, the following guidelines are hereby prescribed for the guidance of all concerned 1. By February 28, 1988 all employees covered by Executive Order No. 127 and the grace period extended to the Bureau of Customs by the President of the Philippines on reorganization shall be: a. informed of their reappointment, or b. offered another position in the same department or agency or c. informed of their termination. 2. In the event of termination, the employee shall: a. be included in a consolidated list compiled by the Civil Service Commission. All departments who are recruiting shall give preference to the employees in the list; and b. continue to receive salary and benefits until February 28, 1988, and c. be guaranteed the release of separation benefits within 45 days from termination and in no case later than June 15, 1988. xxx xxx xxx (Emphasis supplied)

It is to be noted that paragraph 1 above and its sub-sections reproduced verbatim the Malacanang Guidelines of 2 October 1987 in that the employees concerned were merely to be informed of their termination. On 28 January 1988 Commissioner Mison addressed identical letters of termination to Bureau of Customs officers and employees effective on 28 February 1988. As of 18 August 1988, Commissioner Mison appointed five hundred twenty-two (522) officials and employees of the Bureau of Customs (CSC Resolution in CSC Case No. 1, dated 20 September 1988, p. 6). In fact, in a letter dated 27 January 1988, Commissioner Mison

recommended Jose M. Balde for appointment to President Aquino as one of three (3) Deputy Commissioners under Executive Order No. 127. In the interim, during the pendency of these Petitions, Republic Act No. 6656, entitled "An Act to Protect the Security of Tenure of Civil Service Officers and Employees in the Implementation of Government Reorganization" was passed by Congress on 9 June 1988. The President signed it into law on 10 June 1988 and the statute took effect on 29 June 1988. On 20 June 1988 Motions were filed, in these cases pending before this Court, invoking the provisions of Republic Act No. 6656. The relevant provisions thereof read: SECTION 1. It is hereby declared the policy of the State to protect the security of tenure of civil service officers and employees in the reorganization of the various agencies of the National government .... SECTION 2. No officer or employee in the career service shall be removed except for a valid cause and after due notice and hearing. A valid cause for removal exists when, pursuant to a bona fide reorganization, a position has been abolished or rendered redundant or there is a need to merge, divide, or consolidate positions in order to meet the exigencies of the service, or other lawful causes allowed by the Civil Service Law. The existence of any or some of the following circumstances may be considered as evidence of bad faith in the removals made as a result of reorganization, giving rise to a claim for reinstatement or reappointment by an aggrieved party: (a) Where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) Where an office is abolished and another performing substantially the same functions is created; (c) Where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) Where there is a reclassification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices; (e) Where the removal violates the order of separation provided in Section 3 hereof. xxx xxx xxx

SECTION 9. All officers and employees who are found by the Civil Service Commission to have been separated in violation of the provisions of this Act, shall be ordered reinstated or reappointed as the case may be without loss of seniority and shall be entitled to full pay for the period of separation. Unless also separated for cause, all officers and employees, including casuals and temporary employees, who have been separated pursuant to reorganization shall, if entitled thereto, be paid the appropriate separation pay and retirement and other benefits under existing laws within ninety (90) days from the date of the effectivity of their separation or from the date of the receipt of the resolution of their appeals as the case may be: Provided, That application for clearance has been filed and no action thereon has been made by the corresponding department or agency. Those who are not entitled to said benefits shall be paid a separation gratuity in the amount equivalent to one (1) month salary for every year of service. Such separation pay and retirement benefits shall have priority of payment out of the savings of the department or agency concerned.

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SECTION 11. The executive branch of the government shall implement reorganization schemes within a specified period of time authorized by law. In the case of the 1987 reorganization of the executive branch, all departments and agencies which are authorized by executive orders promulgated by the President to reorganize shall have ninety (90) days from the approval of this Act within which to implement their respective reorganization plans in accordance with the provisions of this Act. xxx xxx xxx

SECTION 13. All laws, rules and regulations or parts thereof, inconsistent with the provisions of this Act are hereby repealed or modified accordingly. The rights and benefits under this Act shall be retroactive as of June 30, 1987. xxx xxx xxx (Emphasis ours) Given the foregoing statutory backdrop, the issues can now be addressed. Scope of Section 16, Art. XVIII, 1987 Constitution Crucial to the present controversy is the construction to be given to the abovementioned Constitutional provision (SECTION 16, for brevity), which speaks of. Career civil service employees separated from the service not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution ... (paragraphing supplied). To our minds, SECTION 16 clearly recognizes (1) the reorganization authorized by Proclamation No. 3; (2) that such separation is NOT FOR CAUSE but as a result of the reorganization pursuant to said Proclamation; and (3) that the reorganization pursuant to Proclamation No. 3 may be continued even after the ratification of the 1987 Constitution during the transition period. Separation NOT FOR CAUSE The canon for the removal or suspension of a civil service officer or employee is that it must be FOR CAUSE. That means a guarantee of both procedural and substantive due process. Basically, procedural due process would require that suspension or dismissal come only after notice and hearing. Substantive due process would require that suspension or dismissal be 'for cause'." Bernas The Constitution of the Republic of the Philippines: A Commentary, Vol. II, First Edition, 1988, p. 334) The guarantee of removal FOR CAUSE is enshrined in Article IX-B, Section 2(3) of the 1987 Constitution, which states that 'No officer or employee of the civil service shall be removed or suspended except FOR CAUSE provided by law." There can be no question then as to the meaning of the phrase FOR CAUSE. It simply means the observance of both procedural and substantive due process in cases of removal of officers or

employees of the civil service. When SECTION 16 speaks, therefore, of separation from the service NOT FOR CAUSE, it can only mean the diametrical opposite. The constitutional intent to exempt the separation of civil service employees pursuant to Proclamation No. 3 from the operation of Article IX-B, Section 2(3), becomes readily apparent. A distinction is explicitly made between removal FOR CAUSE, which as aforestated, requires due process, and dismissal NOT FOR CAUSE, which implies that the latter is not bound by the "fetters' of due process. It is obviously for that reason that Section 16 grants separation pay and retirement benefits to those separated NOT FOR CAUSE but as a result of the reorganization precisely to soften the impact of the non-observance of due process. "What is envisioned in Section 16 is not a remedy for arbitrary removal of civil servants enjoying security of tenure but some form of relief for members of the career civil service who may have been or may be legally but involuntarily 'reorganized out' of the service or may have voluntarily resigned pursuant to the reorganization policy" (ibid., p. 615). Reorganization Pursuant to Proclamation No. 3 to Continue Transitorily Even After Ratification By its very context, SECTION 16 envisages the continuance of the reorganization pursuant to Proclamation No. 3 even after ratification of the Constitution and during the transition period. The two [2] stages contemplated, namely, (1) the stage before and (2) after ratification, refer to the same nature of separation "NOT FOR CAUSE but as a result of Proclamation No. 3." No valid reason has been advanced for a different treatment after ratification as the majority opines i.e., that separation NOT FOR CAUSE is allowed before ratification but that, thereafter, separation can only be FOR CAUSE. A fundamental principle of Constitutional construction is to assure the realization of the purpose of the framers of the organic law and of the people who adopted it. That the reorganization commenced pursuant to Proclamation No. 3 was envisioned to continue even after the ratification of the 1987 Constitution, at least transitorily, is evident from the intent of its authors discoverable from their deliberations held on 3 October 1986 and evincing their awareness that such reorganization had not as yet been fully implemented. Thus: Mr. PADILLA. Mr. Presiding Officer, on lines 2 to 5 is the clause 'pursuant to the provisions of Article III of Proclamation No. 3, issued on March 25, 1986, and the reorganization.' Are those words necessary? Can we not just say 'result of the reorganization following the ratification of this Constitution'? In other words, must we make specific reference to Proclamation No. 3? Mr. SUAREZ. Yes. I think the committee feels that is necessary, because in truth there has been a reorganization by virtue of Proclamation No. 3. In other words, there are two stages of reorganization covered by this section. Mr. PADILIA. I understand there is a reorganization committee headed by a minister? Mr. SUAREZ. Philippine Commission on Government Reorganization. Mr. PADILLA. But whether that has already been implemented or not, I do not believe in it. There has been a plan, but I do not think it has been implemented. If we want to include any previous reorganization after or before the ratification, why do we not just say reorganization before or after the ratification' to simplify the provision and eliminate twoand-a-half sentences that may not be necessary? And as a result of the reorganization, if the committee feels there has been reorganization before ratification and there be reorganization after, we just say 'before or after the ratification of this Constitution.

Mr. SUAREZ. Something like this as a result of the reorganization effected before or after the ratification of the Constitution on the understanding, with the statement into the records, that this would be applicable to those reorganized out pursuant to the Freedom Constitution also. Mr. PADILLA. That is understood if there has been a reorganization before the ratification or a reorganization after the ratification." (RECORDS of the Constitutional Commission, Vol. 5, p. 416) (Emphasis provided) It should also be recalled that the deadline for the reorganization under Proclamation No. 3 was "one year from February 25, 1986" (Article III, Section 2), or up to February 24, 1987. Executive Order No. 17 itself provided that the review/assessment of personnel be completed "not later than February 24, 1987." But, confronted with the reality of the ratification of the Constitution before that deadline without reorganization having been completed, there was need for a provision allowing for its continuance even after ratification and until completed. It was also to beat that deadline that EO 127 and similar issuances, providing for the reorganization of departments of government, were all dated 30 January 1987 or prior to the plebiscite held on 2 February 1987. The intent to continue and complete the reorganizations started is self- evident in SECTION 16. In Jose vs. Arroyo, et al. (G.R. No. 78435, August 11, 1987), which was a Petition for certiorari and Prohibition to enjoin the implementation of Executive Order No. 127, we recognized that the reorganization pursuant to Proclamation No. 3 as mandated by SECTION 16, was to continue even after ratification when we stated: The contention of petitioner that EO No. 127 is violative of the provision of the 1987 Constitution guaranteeing career civil service employees security of tenure overlooks the provision of Section 16, Art. XVIII (Transitory Provisions) which explicitly authorizes the removal of career civil service employees not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of the Constitution. By virtue of said provision, the reorganization of the Bureau of Customs under Executive Order No. 127 may continue even after the ratification of this Constitution and career civil service employees may be separated from the service without cause as a result of such reorganization. (Emphasis ours) With due respect to the majority, we disagree with its conclusion that the foregoing pronouncement is mere "obiter dictum." An obiter dictum or dictum has been defined as a remark or opinion uttered, by the way. It is a statement of the court concerning a question which was not directly before it (In re Hess 23 A. 2d. 298, 301, 20 N.J. Misc. 12). It is language unnecessary to a decision, (a) ruling on an issue not raised, or (an) opinion of a judge which does not embody the resolution or determination of the court, and is made without argument or full consideration of the point (Lawson v. US, 176 F2d 49, 51, 85 U.S. App. D.C. 167). It is an expression of opinion by the court or judge on a collateral question not directly involved, (Crescent Ring Co. v. Travelers Indemnity Co. 132 A. 106, 107, 102 N.J. Law 85) or not necessary for the decision Du Bell v. Union Central Life Ins. Co., 29, So. 2d 709, 712; 211 La. 167).
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In the case at bar, however, directly involved and squarely before the Court was the issue of whether EO 127 violates Section 2(3) of Article IX-B of the 1987 Constitution against removal of civil service employees except for cause." Petitioner batted for the affirmative of the proposition, while respondents contended that "removal of civil service employees without cause is allowed not only under the Provisional Constitution but also under the 1987 Constitution if the same is made pursuant to a reorganization after the ratification of the Constitution."

It may be that the Court dismissed that Petition for being premature, speculative and purely anticipatory" inasmuch as petitioner therein had "not received any communication terminating or threatening to terminate his services." But that was only one consideration. The Court still proceeded to decide all the issues adversatively contested by the parties, namely "1) that the expiration date of February 25, 1 987 fixed by Section 2 of Proclamation No. 3 on which said Executive order is based had already lapsed; 2) that the Executive Order has not been published in the Official Gazette as required by Article 2 of the Civil Code and Section 1 1 of the Revised Administrative Code; and 3) that its enforcement violates Section 2(3) of Article IX B of the 1987 Constitution against removal of civil service employees except for cause." The ruling of the Court, therefore, on the Constitutional issues presented, particularly, the lapse of the period mandated by Proclamation No. 3, and the validity of EO 127, cannot be said to be mere "obiter." They were ultimate issues directly before the Court, expressly decided in the course of the consideration of the case, so that any resolution thereon must be considered as authoritative precedent, and not a mere dictum (See Valli v. US, 94 F2d 687 certiorari granted 58 S. Ct. 760, 303 U.S. 82 L. Ed. 1092; See also Weedin v. Tayokichi Yamada 4 F. (2d) 455). Such resolution would not lose its value as a precedent just because the disposition of the case was also made on some other ground. .....And this rule applies as to all pertinent questions although only incidentally involved, which are presented and decided in the regular course of the consideration of the case, and lead up to the final conclusion (Northern Pac. Ry Co. v. Baker, D.C. Wash., 3 F. Suppl. 1; See also Wisconsin Power and Light Co. v. City of Beloit 254 NW 119; Chase v. American Cartage Co. 186 N.W. 598; City of Detroit, et al. v. Public Utilities Comm. 286 N.W. 368). Accordingly, a point expressly decided does not lose its value as a precedent because the disposition of the case is made on some other ground. (Wagner v. Com Products Refining Co. D.C. N.J. 28 F 2d 617) Where a case presents two or more points, any one of which is sufficient to determine the ultimate issue, but the court actually decides all such points, the case is an authoritative precedent as to every point decided, and none of such points can be regarded as having merely the status of a dictum (See U.S. Title Insurance and Trust Co., Cal., 44 S. Ct. 621, 265 U.S. 472, 68 L. Ed. 1110; Van Dyke v. Parker 83 F. (2d) 35) and one point should not be denied authority merely because another point was more dwelt on and more fully argued and considered. (Richmond Screw Anchor Co. v. U.S. 48 S. Ct. 194, 275 U.S. 331, 72 L. Ed. 303)" It is true that in Palma-Fernandez vs. de la Paz (G.R. No. 78946, April 15, 1986, 160 SCRA 751), we had stated: The argument that, on the basis of this provision (Section 26 of Executive Order No. 119, or the 'Reorganization Act of the Ministry of Health'), petitioner's term of office ended on 30 January 1987 and that she continued in the performance of her duties merely in a hold-over capacity and could be transferred to another position without violating any of her legal rights, is untenable. The occupancy of a position in a hold-over capacity was conceived to facilitate reorganization and would have lapsed on 25 February 1987 (under the Provisional Constitution), but advanced to 2 February 1987 when the 1987 Constitution became effective (De Leon, et al., vs. Hon. Esguerra, et al., G.R. No. 78059, 31 August 1987, 153 SCRA 602). After the d date the provisions of the latter on security of tenure govern. The factual situation in the two cases, however, radically differ. In the cited case, Dra. PalmaFernandez, the petitioner, had already been extended a permanent appointment as Assistant Director for Professional Services of the East Avenue Medical Center but was still being transferred by the Medical Center Chief to the Research Office against her consent. Separation from the service as a result of reorganization was not involved. The question then arose as to whether the latter official had the authority to transfer or whether the power to appoint and remove subordinate officers and employees was lodged in the Secretary of Health. Related to that issue was the vital one of whether or not her transfer, effected on 29 May 1987, was

tantamount to a removal without cause. Significant, too, is the fact that the transfer was basically made "in the interest of the service" pursuant to Section 24(c) of PD No. 807, or the Civil Service Decree, and not because she was being reorganized out by virtue of EO 119 or the "Reorganization Act of the Ministry of Health," although the said Act was invoked after the fact. And so it was that SECTION 16 was never mentioned, much less invoked in the PalmaFernandez case. Finally, on this point, it is inaccurate for the majority to state that there were no reorganization orders after ratification. There were, namely, EO 181 (Reorganization Act of the Civil Service Commission), June 1, 1987; EO 193 (Reorganization Act of the Office of Energy Affairs), June 10, 1987; EO 230 (Reorganization Act of NEDA), July 22, 1987; EO 262 (Reorganization Act of the Department of Local Government), July 25, 1987; EO 297 (Reorganization Act of the Office of the Press Secretary), July 25, 1987. The Element of Good Faith The majority concedes that reorganization can be undertaken provided it be in good faith but concludes that Commissioner Mison was not in good faith. The aforesaid conclusion is contradicted by the records. Executive Order No. 127, dated 30 January 1987, specifically authorized the reorganization of the Bureau of Customs "structurally and functionally" and provided for the abolition of all units and positions thereof not included in the structural organization S election 55). As stated heretofore, it was the former Commissioner of Customs, Alexander A. Padilla who, on 24 May 1987, transmitted to the Department of Finance for approval the proposed "position structure and staffing pattern" of the Bureau of Customs. This was approved by the Department of Finance. Thereafter, it was transmitted to and approved by the Department of Budget and Management on 7 September 1987 for implementation. Under the old staffing pattern, there were 7,302 positions while under the new staffing pattern, there are 6,530 positions. On 2 October 1987 "Malacanang Memorandum Re: Guidelines on the Implementation of Reorganization Executive Orders" provided: By October 21, 1987, all employees covered by the Executive orders for each agency on reorganization shall be: a. informed of their reappointment, or b. offered another position in the same department or agency, or c. informed of their termination. (emphasis supplied) On 25 November 1987 Commissioner Mison asked for and was granted by the President an extension up to February 1988 within which to completely undertake the reorganization of the Bureau of Customs. On 6 January 1988, he issued Bureau of Customs Memorandum "Re Guidelines on the Implementation of Reorganization Executive Orders" reiterating the above- quoted portion of the Malacanang Memorandum of 2 October 1987. Pursuant thereto, on 28 January 1988, Commissioner Mison addressed uniform letters of termination to the employees listed on pages 15, 16 and 17 of the majority opinion, effective on 28 February 1988, within the extended period granted.

The records further show that upon Commissioner Mison's official inquiry, Secretary of Justice Sedfrey A. Ordo;ez, rendered the following Opinion: . . . It is believed that customs employees who are reorganized out in the course of the implementation of E.O. No. 127 (reorganizing the Department of Finance) need not be informed of the nature and cause of their separation from the service. It is enough that they be 'informed of their termination' pursuant to section 1(c) of the Memorandum dated October 2, 1987 of President Aquino, which reads: 1. By October 21, 1987, all employees covered by the Executive orders for each agency on reorganization shall be: xxx xxx xxx

c) Informed of their terminations. The constitutional mandate that 'no officer or employee of the civil service shall be renewed or suspended except for cause as provided by law' (Sec. 2(4) (sic), Article IX-B of the 1987 Constitution) does not apply to employees who are separated from office as a result of the reorganization of that Bureau as directed in Executive Order No. 127. xxx xxx xxx

Regarding your (third) query, the issue as to the constitutionality of Executive Order No. 127 is set at rest, after the Supreme Court resolved to dismiss the petition for certiorari questioning its enforceability, for lack of merit (see Jose vs. Arroyo, et al., supra). (Opinion No. 41, s. 1988, March 3, 1988) (Emphasis supplied) The former Chairman of the Civil Service Commission, Celerina G. Gotladera likewise periodically consulted by Commissioner Mison, also expressed the opinion that "it is not a prerequisite prior to the separation of an employee pursuant to reorganization that he be administratively charged." (Annex 16, p. 411, Rollo, G.R. No. 85310) Moreover, the records show that the final selection and placement of personnel was done by a Placement Committee, one of whose members is the Head of the Civil Service Commission Field Office, namely, Mrs. Purificacion Cuerdo The appointment of employees made by Commissioner Mison was based on the list approved by said Placement Committee. But the majority further faults Mison for defying the President's directive to halt further layoffs as a consequence of reorganization, citing OP Memo of 14 October 1987, reading: Further to the Memorandum dated October 2, 1987 on the same subject, I have ordered that there will be no further layoffs this year of personnel as a result of the government reorganization. (p. 45, Decision) The foregoing, however, must be deemed superseded by later developments, namely, the grant to Commissioner Mison by the President on 22 December 1987 of a grace period until the end of February 1988 within which to completely undertake the reorganization of the Bureau of Customs, which was, in fact, accomplished by 28 February 1988. To further show lack of good faith, the majority states that Commissioner Mison failed to observe the procedure laid down by EO 17, supra, directing inter alia that a notice of separation be issued to an employee to be terminated indicating therein the reason/s or ground/s for such separation. That requirement, however, does not appear in Section 59 of EO 127, which provides on the contrary "that those incumbents whose positions are not included in the new position structure

and staffing pattern of the Ministry or who are not reappointed shall be deemed separated from the service." The right granted by EO 17 to an employee to be informed of the ground for his separation must be deemed to have been revoked by the repealing clause of EO 127 (Section 67) providing that "all laws, ordinances or parts thereof, which are inconsistent with this Executive Order, are hereby repealed and modified accordingly." Moreover, Section 11 of EO 17 explicitly excepts from its coverage a reorganization pursuant to EO 5. Thus The Executive Order shall not apply to elective officials or those designated to replace them, presidential appointees, casual and contractual employees, or officials and employees removed pursuant to desciplinary proceedings under the Civil Service law and rules, and to those laid off as a result of reorganization undertaken pursuant to Executive Order No. 5. (Emphasis ours) That EO 127 was issued pursuant to or in implementation of EO 5, is shown by its introductory portion reading: Recalling that the reorganization of the government is mandated expressly by Article II, Section 1 (a) and Article III of the Freedom Constitution; Having in mind that pursuant to Executive order No. 5 (1986), it is directed that the necessary and proper changes in the organizational and functional structures of the government, its agencies and instrumentalities, be effected in order to promote efficiency and effectiveness in the delivery of public service; (Italics supplied) Constitutionality of Republic Act No. 6656 The majority also relies on Republic Act No. 6656 entitled an "Act to Protect the Security of Tenure of Civil Service Officers and Employees in the Implementation of Government Reorganization," particularly Section 2 thereof, to test the good faith of Commissioner Mison. We are of the view, however, that in providing for retroactivity in its Section 13, RA 6656 clashes frontally with SECTION 16. 1) SECTION 16 clearly recognizes that career service employees separated from the service by reason of the "complete reorganization of the government" pursuant to Proclamation No. 3 may be separated NOT FOR CAUSE. And yet, RA 6656 requires the exact opposite separation FOR CAUSE. It would not be remiss to quote the provision again: SEC. 2. No officer or employee in the career service shall be removed except for a valid cause and after due notice and hearing. A valid cause for removal exist when, pursuant to a bona fide reorganization, a position has been abolished or rendered redundant or there is a need to merge, divide, or consolidate positions in order to meet the exigencies of the service, or other lawful causes allowed by the Civil Service law. The existence of any or some of the following circumstances may be considered as evidence of bad faith in the removals made as a result of reorganization, giving rise to a claim for reinstatement or reappointment by an aggrieved party: (a) Where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) Where an office is abolished and another performing substantially the same functions is created; (c) Where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) Where there is a reclassification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices; (e) Where the removal violates the order of separation provided in Section 3 hereof. (Republic Act No. 6156)

The standards laid down are the "traditional" criteria for removal of employees from the career service, e.g. valid cause, due notice and hearing, abolition of, or redundancy of offices. Proclamation No. 3, on the other hand, effectuates the "progressive" type of reorganization dictated by the exigencies of the historical and political upheaval at the time. The "traditional" type is limited in scope. It is concerned with the individual approach where the particular employee involved is charged administratively and where the requisites of notice and hearing have to be observed. The "progressive" kind of reorganization, on the other hand, is the collective way. It is wider in scope, and is the reorganization contemplated under SECTION 16. 2) By providing for reinstatement in its Section 9, RA 6656 adds a benefit not included in SECTION 16. The benefits granted by the latter provision to employees separated NOT FOR CAUSE but as a consequence of reorganization are "separation pay, retirement, and other benefits accruing to them under the laws of general application in force at the time of their separation." The benefit of reinstatement is not included. RA 6656, however, allows reinstatement. That it cannot do because under SECTION 16, it is not one of the laws "in force at the time of their separation." The Constitution is the paramount law to which all laws must conform. It is from the Constitution that all statutes must derive their bearings. The legislative authority of the State must yield to the expression of the sovereign will. No statutory enactment can disregard the Charter from which it draws its own existence (Phil. Long Distance Telephone Co. v. Collector of Internal Revenue, 90 Phil. 674 [1952]). But, that is exactly what RA 6656 does in providing for retroactivity it disregards and contravenes a Constitutional imperative. To save it, it should be applied and construed prospectively and not retroactively notwithstanding its explicit provision. Then, and only then, would it make good law. Effects of Reorganization To be sure, the reorganization could effect the tenure of members of the career service as defined in Section 5, Article IV of Presidential Decree No. 807, and may even result in the separation from the office of some meritorious employees. But even then, the greater good of the greatest number and the right of the citizenry to a good government, and as they themselves have mandated through the vehicle of Proclamation No. 3, provide the justification for the said injury to the individual. In terms of values, the interest of an employee to security of tenure must yield to the interest of the entire populace and to an efficient and honest government. But a reorganized employee is not without rights. His right lies in his past services, the entitlement to which must be provided for by law. EO 127 provides for the same in its Section 59, and so does SECTION 16 when the latter specified that career civil service employees separated from the service not for cause: shall be entitled to appropriate separation pay and to retirement and other benefits accruing to them under the laws of general application in force at the time of their separation. In lieu thereof, at the option of the employees, they may be considered for employment in the Government or in any of its subdivisions, instrumentalities, or agencies, including government-owned or controlled corporations and their subsidiaries. This provision also applies to career officers whose resignation, tendered in line with the existing policy, has been accepted. This is a reward for the employee's past service to the Government. But this is all There is no vested property right to be reemployed in a reorganized office. The right to an office or to employment with government or any of its agencies is not a vested property right, and removal therefrom will not support the question of due process" Yantsin v. Aberdeen, 54 Wash 2d 787, 345 P 2d 178). A civil service employee does not have a constitutionally protected right to his position, which position is in the

nature of a public office, political in character and held by way of grant or privilege extended by government; generally he has been held to have no property right or vested interest to which due process guaranties extend (See Taylor v. Beckham 178 U.S. 548, 44 L Ed. 1187; Angilly v. US CA2 NY 199 F 2d 642; People ex. rel. Baker v. Wilson, 39 III App 2d 443, 189 NE 2d 1; Kelliheller v. NY State Civil Service Com 21 Misc 2d 1034, 194 NYS 2d 89). To ensure, however, that no meritorious employee has been separated from the service, there would be no harm, in fact, it could do a lot of good, if the Commissioner of Customs reviews the evaluation and placements he has so far made and sees to it that those terminated are included in a consolidated list to be given preference by departments who are recruiting (Section 2[a], BOC Memorandum, January 6,1988).
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Conclusion Premises considered, and subject to the observation hereinabove made, it is our considered view that the separation from the service "NOT FOR CAUSE but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986" of the affected officers and employees of the Bureau of Customs should be UPHELD, and the Resolutions of the Civil Service Commission, dated 30 June 1988, 20 September 1988, and 16 November 1988 should be SET ASIDE for having been issued in grave abuse of discretion. Republic Act No. 6656, in so far as it provides for retroactivity, should be declared UNCONSTITUTIONAL for being repugnant to the letter and spirit of Section 16, Article XVIII of the 1987 Constitution.

Fernan, C.J., Narvasa, Feliciano, Regalado, JJ., concur.

Separate Opinions CRUZ, J., concurring: I concur with the majority view so ably presented by Mr. Justice Abraham F. Sarmiento. While additional comments may seem superfluous in view of the exhaustiveness of his ponencia, I nevertheless offer the following brief observations for whatever they may be worth. Emphasizing Article XVII, Section 16 of the Constitution, the dissenting opinion considers the ongoing government reorganization valid because it is merely a continuation of the reorganization begun during the transition period. The reason for this conclusion is the phrase "and the reorganization following the ratification of the Constitution," that is to say, after February 2, 1987, appearing in the said provision. The consequence (and I hope I have not misread it) is that the present reorganization may still be undertaken with the same "absoluteness" that was allowed the revolutionary reorganization although the Freedom Constitution is no longer in force. Reorganization of the government may be required by the legislature even independently of specific constitutional authorization, as in the case, for example, of R.A. No. 51 and B.P. No. 129. Being revolutionary in nature, the reorganization decreed by Article III of the Freedom Constitution was unlimited as to its method except only as it was later restricted by President Aquino herself through various issuances, particularly E.O. No. 17. But this reorganization, for all its permitted summariness, was not indefinite. Under Section 3 of the said Article III, it was allowed only up to February 29,1987 (which we advanced to February 2, 1987, when the new Constitution became effective).

The clear implication is that any government reorganization that may be undertaken thereafter must be authorized by the legislature only and may not be allowed the special liberties and protection enjoyed by the revolutionary reorganization. Otherwise, there would have been no necessity at all for the time limitation expressly prescribed by the Freedom Constitution. I cannot accept the view that Section 16 is an authorization for the open-ended reorganization of the government "following the ratification of the Constitution." I read the provision as merely conferring benefits deservedly or not on persons separated from the government as a result of the reorganization of the government, whether undertaken during the transition period or as a result of a law passed thereafter. What the grants is privileges to the retirees, not power to the provision government. It is axiomatic that grants of power are not lightly inferred, especially if these impinge on individual rights, and I do not see why we should depart from this rule. To hold that the present reorganization is a continuation of the one begun during the transition period is to recognize the theory of the public respondent that all officers and employees not separated earlier remain in a hold-over capacity only and so may be replaced at any time even without cause. That is a dangerous proposition that threatens the security and stability of every civil servant in the executive department. What is worse is that this situation may continue indefinitely as the claimed "progressive" reorganization has no limitation as to time. Removal imports the forcible separation of the incumbent before the expiration of his term and can be done only for cause as provided by law. Contrary to common belief, a reorganization does not result in removal but in a different mode of terminating official relations known as abolition of the office (and the security of tenure attached thereto.) The erstwhile holder of the abolished office cannot claim he has been removed without cause in violation of his constitutional security of tenure. The reason is that the right itself has disappeared with the abolished office as an accessory following the principal. (Ocampo v. Sec. of Justice, 51 O.G. 147; De la Llana v. Alba, 112 SCRA 294; Manalang v. Quitoriano, 94 Phil. 903.) This notwithstanding, the power to reorganize is not unlimited. It is essential that it be based on a valid purpose, such as the promotion of efficiency and economy in the government through a pruning of offices or the streamlining of their functions. (Cervantes v. Auditor-General, 91 Phil. 359.) Normally, a reorganization cannot be validly undertaken as a means of purging the undesirables for this would be a removal in disguise undertaken enmasse to circumvent the constitutional requirement of legal cause. (Eradication of graft and corruption was one of the expressed purposes of the revolutionary organization, but this was authorized by the Freedom Constitution itself.) In short, a reorganization, to be valid, must be done in good faith. (Urgelio v. Osmena, 9 SCRA 317; Cuneta v. Court of Appeals, 1 SCRA 663; Carino v. ACCFA, 18 SCRA 183.) A mere recitation no matter how lengthy of the directives, guidelines, memoranda, etc. issued by the government and the action purportedly taken thereunder does not by itself prove good faith. We know only too well that these instructions, for all their noble and sterile purposes, are rarely followed in their actual implementation. The reality in this case, as the majority opinion has pointed out and as clearly established in the hearing we held, is that the supposed reorganization was undertaken with an eye not to achieving the avowed objectives but to accommodating new appointees at the expense of the dislodged petitioners. That was also the finding of the Civil Service Commission, to which we must accord a becoming respect as the constitutional office charged with the protection of the civil service from the evils of the spoils system. The present administration deserves full support in its desire to improve the civil service, but this objective must be pursued in a manner consistent with the Constitution. This praiseworthy purpose cannot be accomplished by an indiscriminate reorganization that will sweep in its wake the innocent along with the redundant and inept, for the benefit of the current favorites.

MELENCIO-HERRERA, J., dissenting: The historical underpinnings of Government efforts at reorganization hark back to the people power phenomenon of 22-24 February 1986, and Proclamation No. 1 of President Corazon C. Aquino, issued on 25 February 1986, stating in no uncertain terms that "the people expect a reorganization of government." In its wake followed Executive Order No. 5, issued on 12 March 1986, "Creating a Presidential Commission on Government Reorganization," with the following relevant provisions: WHEREAS, there is need to effect the necessary and proper changes in the organizational and functional structures of the national and local governments, its agencies and instrumentalities, including government-owned and controlled corporations and their subsidiaries, in order to promote economy, efficiency and effectiveness in the delivery of public services xxx xxx xxx

Section 2. The functional jurisdiction of the PCGR shall encompass, as necessary, the reorganization of the national and local governments, its agencies and instrumentalities including government-owned or controlled corporations and their subsidiaries. xxx xxx xxx (Emphasis supplied)

Succeeding it was Proclamation No. 3, dated 25 March 1986, also known as the Freedom Constitution, declaring, in part, in its Preamble as follows: WHEREAS, the direct mandate of the people as manifested by their extraordinary action demands the complete reorganization of the government, ... (Emphasis supplied) and pertinently providing: ARTICLE II Section I xxx xxx xxx

The President shall give priority to measures to achieve the mandate of the people to: (a) Completely reorganize the government and eradicate unjust and oppressive structures, and all iniquitous vestiges of the previous regime;" (Emphasis supplied) xxx xxx xxx

ARTICLE III GOVERNMENT REORGANIZATION Section 2. All elective and appointive officials and employees under the 1973 Constitution shall continue in office until otherwise provided by proclamation or executive order or upon the designation or appointment and qualification of their successors, if such is made within a period of one year from February 25, 1986.

Section 3. Any public office or employee separated from the service as a result of the reorganization effected under this Proclamation shall, if entitled under the laws then in force, receive the retirement and other benefits accruing thereunder. (Emphasis ours) On 28 May 1986, Executive Order No. 17 was issued "Prescribing Rules and Regulations for the Implementation of Section 2, Article III of the Freedom Constitution' providing, inter alia, as follows: Section 1. In the course of implementing Article III, Section 2 of the Freedom Constitution, the Head of each Ministry shall see to it that the separation or replacement of officers and employees is made only for justifiable reasons, to prevent indiscriminate dismissal, of personnel in the career civil service whose qualifications and performance meet the standards of public service of the New Government. xxx xxx xxx

The Ministry concerned shall adopt its own rules and procedures for the review and assessment of its own personnel, including the identification of sensitive positions which require more rigid assessment of the incumbents, and shall complete such review/assessment as expeditiously as possible but not later than February 24, 1987 to prevent undue demoralization in the public service. Section 2. The Ministry Head concerned, on the basis of such review and assessment shall determine who shall be separated from the service. Thereafter, he shall issue to the official or employee concerned anotice of separation which shall indicate therein the reason/s or ground /s for such separation and the fact that the separated official or employee has the right to file a petition for reconsideration pursuant to this Order. Separation from the service shall be effective upon receipt of such notice, either personally by the official or employee concerned or on his behalf by a person of sufficient discretion. Section 3. The following shall be the grounds for separation/ replacement of personnel: 1. Existence of a case for summary dismissal pursuant to Section 40 of the Civil Service Law; 2. Existence of a probable cause for violation of the Anti-Graft and Corrupt Practice Act as determined by the Ministry Head concerned; 3. Gross incompetence or inefficiency in the discharge of functions; 4. Misuse of Public office for partisan political purposes; 5. Any other analogous ground showing that the incumbent is unfit to remain in the service or his separation/replacement is in the interest of the service. Section 11. This Executive Order shall not apply to elective officials or those designated to replace them, presidential appointees, casual and contractual employees, or officials and employees removed pursuant to disciplinary proceedings under the Civil Service Law and rules, and to those laid off as a result of the reorganization undertaken pursuant to Executive Order No. 5. (Emphasis supplied) On 6 August 1986, Executive Order No. 39 was issued by the President "Enlarging the Powers and Functions of the Commissioner of Customs", as follows:

xxx

xxx

xxx

SECTION 1. In addition to the powers and functions of the Commissioner of Customs, he is hereby authorized, subject to the Civil Service Law and its implementing rules and regulations: a) To appoint all Bureau personnel, except those appointed by the President; b) To discipline, suspend, dismiss or otherwise penalize erring Bureau officers and employees; c) To act on all matters pertaining to promotion, transfer, detail, reassignment, reinstatement, reemployment and other personnel action, involving officers and employees of the Bureau of Customs. xxx xxx xxx

On 30 January 1987, Executive Order No. 127 was issued "Reorganizing the Ministry of Finance." Similar Orders, approximately thirteen (13) in all, 1 were issued in respect of the other executive departments. The relevant provisions relative to the Bureau of Customs read: RECALLING that the reorganization of the government is mandated expressly in Article II, Section l(a) and Article III of the Freedom Constitution; HAVING IN MIND that pursuant to Executive Order No. 5 (1986), it is directed that the necessary and proper changes in the organizational and functional structures of the government, its agencies and instrumentalities, be effected in order to promote efficiency and effectiveness in the delivery of public services; BELIEVING that it is necessary to reorganize the Ministry of Finance to make it more capable and responsive, organizationally and functionally, in its primary mandate of judiciously generating and efficiently managing the financial resources of the Government, its subdivisions and instrumentalities in order to attain the socio-economic objectives of the national development programs. xxx xxx xxx

SEC. 2. Reorganization. The Ministry of Finance, hereinafter referred to as Ministry, is hereby reorganized, structurally and functionally, in accordance with the provisions of this Executive Order. SEC. 33. Bureau of Customs. ... Executive Order No. 39 dated 6 August 1986 which grants autonomy to the Commissioner of Customs in matters of appointment and discipline of Customs personnel shall remain in effect. SEC. 55. Abolition of Units Integral to Ministry. All units not included in the structural organization as herein provided and all positions thereof are hereby deemed abolished. ... Their personnel shall be entitled to the benefits provided in the second paragraph of Section 59 hereof. SEC. 59. New Structure and Pattern. Upon approval of this Executive Order, the officers and employees of the Ministry shall, in a holdover capacity, continue to perform

their respective duties and responsibilities and receive the corresponding salaries and benefits unless in the meantime they are separated from government service pursuant to executive Order No. 17 (1986) or article III of the Freedom Constitution. The new position structure and staffing pattern of the ministry shall be approved and prescribed by the Minister within one hundred twenty (120) days from the approval of this Executive Order and the authorized positions created hereunder shall be filled with regular appointments by him or by the President, as the case may be. Those incumbents whose positions are not included therein or who are not reappointed shall be deemed separated from the service. Those separated from the service shall receive the retirement benefits to which they may be entitled under the existing laws, rules and regulations. Otherwise, they shall be paid the equivalent of one month basic salary for every year of service or the equivalent nearest fraction thereof favorable to them on the basis of highest salary received, but in no case shall such payment exceed the equivalent of 12 months salary. No court or administrative body shall issue any writ or preliminary junction or restraining order to enjoin the separation/replacement of any officer or employee affected under this Executive Order. Section 67 All laws, ordinances, rules, regulations and other issuances or parts thereof, which are inconsistent with this Executive Order, are hereby repealed or modified accordingly. xxx xxx xxx (Emphasis ours)

On 2 February 1987, the present Constitution took effect (De Leon, et al., vs. Esguerra, G.R. No. 78059, August 31, 1987153 SCRA 602). Reorganization in the Government service pursuant to Proclamation No. 3, supra, was provided for in its Section 16, Article XVIII entitled Transitory Provisions, reading: Section 16. Career civil service employees separated from the service not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution shall be entitled to appropriate separation pay and to retirement and other benefits accruing to them under the laws of general application in force at the time of their separation. In lieu thereof, at the option of the employees, they may be considered for employment in the Government or in any of its subdivisions, instrumentalities, or agencies, including government owned or controlled corporations and their subsidiaries. Ms provision also applies to career officers whose resignation, tendered in line with the existing policy, has been accepted. On 24 May 1987 the then Commissioner of Customs, Alexander A. Padilla, transmitted to the Department of Finance for approval the proposed "position structure and staffing pattern" of the Bureau of Customs. Said Department gave its imprimatur. Thereafter, the staffing pattern was transmitted to and approved by the Department of Budget and Management on 7 September 1987 for implementation. Under the old staffing pattern, there were 7,302 positions while under the new staffing pattern, there are 6,530 positions CSC Resolution in CSC Case No. 1, dated 20 September 1988, pp. 3-4). On 22 September 1987, Salvador M. Mison assumed office as Commissioner of Customs. On 2 October 1987 "Malacanang Memorandum Re: Guidelines on the Implementation of Reorganization Executive Orders" was issued reading, insofar as revelant to these cases, as follows:

It is my concern that ongoing process of government reorganization be conducted in a manner that is expeditious, as well as sensitive to the dislocating consequences arising from specific personnel decisions. The entire process of reorganization, and in particular the process of separation from service, must be carried out in the most humane manner possible. For this purpose, the following guidelines shall be strictly followed: 1. By October 21, 1987, all employees covered by the Executive Orders for each agency on reorganization shall be: a. informed of their reappointment or b. offered another position in the same department/ agency or c. informed of their termination. 2. In the event of an offer for a lower position, there will be no reduction in the salary. xxx xxx xxx

4. Each department/agency shall constitute a Reorganization Appeals Board at the central office, on or before October 21, 1987, to review or reconsider appeals or complaints relative to reorganization. All cases submitted to the Boards shall be resolved subject to the following guidelines: a. publication or posting of the appeal procedure promulgated by the Department Secretary; b. adherence to due process; c. disposition within 30 days from submission of the case; d written notification of the action taken and the grounds thereof. Action by the Appeals Review Board does not preclude appeal to the Civil Service Commission. 5. Placement in the new staffing pattern of incumbent personnel shall be completed prior to the hiring of new personnel, if any. xxx xxx xxx (Emphasis ours)

On 25 November 1987 Commissioner Mison wrote the President requesting a grace period until the end of February 1988 within which to completely undertake the reorganization of the Bureau of Customs pursuant to Executive Order No. 127 dated 30 January 1987. Said request was granted in a letter-reply by Executive Secretary Catalino Macaraig, Jr., dated 22 December 1987. On 6 January 1988, within the extended period requested, Bureau of Customs Memorandum "Re: Guidelines on the Implementation of Reorganization Executive Orders" was issued in the same tenor as the Malacanang Memorandum of 2 October 1987, providing inter alia:

To effectively implement the reorganization at the Bureau of Customs, particularly in the selection and placement of personnel, and insure that the best qualified and most competent personnel in the career service are retained, the following guidelines are hereby prescribed for the guidance of all concerned 1. By February 28, 1988 all employees covered by Executive Order No. 127 and the grace period extended to the Bureau of Customs by the President of the Philippines on reorganization shall be: a. informed of their reappointment, or b. offered another position in the same department or agency or c. informed of their termination. 2. In the event of termination, the employee shall: a. be included in a consolidated list compiled by the Civil Service Commission. All departments who are recruiting shall give preference to the employees in the list; and b. continue to receive salary and benefits until February 28, 1988, and c. be guaranteed the release of separation benefits within 45 days from termination and in no case later than June 15, 1988. xxx xxx xxx (Emphasis supplied)

It is to be noted that paragraph 1 above and its sub-sections reproduced verbatim the Malacanang Guidelines of 2 October 1987 in that the employees concerned were merely to be informed of their termination. On 28 January 1988 Commissioner Mison addressed identical letters of termination to Bureau of Customs officers and employees effective on 28 February 1988. As of 18 August 1988, Commissioner Mison appointed five hundred twenty-two (522) officials and employees of the Bureau of Customs (CSC Resolution in CSC Case No. 1, dated 20 September 1988, p. 6). In fact, in a letter dated 27 January 1988, Commissioner Mison recommended Jose M. Balde for appointment to President Aquino as one of three (3) Deputy Commissioners under Executive Order No. 127. In the interim, during the pendency of these Petitions, Republic Act No. 6656, entitled "An Act to Protect the Security of Tenure of Civil Service Officers and Employees in the Implementation of Government Reorganization" was passed by Congress on 9 June 1988. The President signed it into law on 10 June 1988 and the statute took effect on 29 June 1988. On 20 June 1988 Motions were filed, in these cases pending before this Court, invoking the provisions of Republic Act No. 6656. The relevant provisions thereof read: SECTION 1. It is hereby declared the policy of the State to protect the security of tenure of civil service officers and employees in the reorganization of the various agencies of the National government .... SECTION 2. No officer or employee in the career service shall be removed except for a valid cause and after due notice and hearing. A valid cause for removal exists when,

pursuant to a bona fide reorganization, a position has been abolished or rendered redundant or there is a need to merge, divide, or consolidate positions in order to meet the exigencies of the service, or other lawful causes allowed by the Civil Service Law. The existence of any or some of the following circumstances may be considered as evidence of bad faith in the removals made as a result of reorganization, giving rise to a claim for reinstatement or reappointment by an aggrieved party: (a) Where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) Where an office is abolished and another performing substantially the same functions is created; (c) Where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) Where there is a reclassification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices; (e) Where the removal violates the order of separation provided in Section 3 hereof. xxx xxx xxx

SECTION 9. All officers and employees who are found by the Civil Service Commission to have been separated in violation of the provisions of this Act, shall be ordered reinstated or reappointed as the case may be without loss of seniority and shall be entitled to full pay for the period of separation. Unless also separated for cause, all officers and employees, including casuals and temporary employees, who have been separated pursuant to reorganization shall, if entitled thereto, be paid the appropriate separation pay and retirement and other benefits under existing laws within ninety (90) days from the date of the effectivity of their separation or from the date of the receipt of the resolution of their appeals as the case may be: Provided, That application for clearance has been filed and no action thereon has been made by the corresponding department or agency. Those who are not entitled to said benefits shall be paid a separation gratuity in the amount equivalent to one (1) month salary for every year of service. Such separation pay and retirement benefits shall have priority of payment out of the savings of the department or agency concerned. xxx xxx xxx

SECTION 11. The executive branch of the government shall implement reorganization schemes within a specified period of time authorized by law. In the case of the 1987 reorganization of the executive branch, all departments and agencies which are authorized by executive orders promulgated by the President to reorganize shall have ninety (90) days from the approval of this Act within which to implement their respective reorganization plans in accordance with the provisions of this Act. xxx xxx xxx

SECTION 13. All laws, rules and regulations or parts thereof, inconsistent with the provisions of this Act are hereby repealed or modified accordingly. The rights and benefits under this Act shall be retroactive as of June 30, 1987. xxx xxx xxx (Emphasis ours) Given the foregoing statutory backdrop, the issues can now be addressed. Scope of Section 16, Art. XVIII, 1987 Constitution Crucial to the present controversy is the construction to be given to the abovementioned Constitutional provision (SECTION 16, for brevity), which speaks of. Career civil service employees separated from the service not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution ... (paragraphing supplied). To our minds, SECTION 16 clearly recognizes (1) the reorganization authorized by Proclamation No. 3; (2) that such separation is NOT FOR CAUSE but as a result of the reorganization pursuant to said Proclamation; and (3) that the reorganization pursuant to Proclamation No. 3 may be continued even after the ratification of the 1987 Constitution during the transition period. Separation NOT FOR CAUSE The canon for the removal or suspension of a civil service officer or employee is that it must be FOR CAUSE. That means a guarantee of both procedural and substantive due process. Basically, procedural due process would require that suspension or dismissal come only after notice and hearing. Substantive due process would require that suspension or dismissal be 'for cause'." Bernas The Constitution of the Republic of the Philippines: A Commentary, Vol. II, First Edition, 1988, p. 334) The guarantee of removal FOR CAUSE is enshrined in Article IX-B, Section 2(3) of the 1987 Constitution, which states that 'No officer or employee of the civil service shall be removed or suspended except FOR CAUSE provided by law." There can be no question then as to the meaning of the phrase FOR CAUSE. It simply means the observance of both procedural and substantive due process in cases of removal of officers or employees of the civil service. When SECTION 16 speaks, therefore, of separation from the service NOT FOR CAUSE, it can only mean the diametrical opposite. The constitutional intent to exempt the separation of civil service employees pursuant to Proclamation No. 3 from the operation of Article IX-B, Section 2(3), becomes readily apparent. A distinction is explicitly made between removal FOR CAUSE, which as aforestated, requires due process, and dismissal NOT FOR CAUSE, which implies that the latter is not bound by the "fetters' of due process. It is obviously for that reason that Section 16 grants separation pay and retirement benefits to those separated NOT FOR CAUSE but as a result of the reorganization precisely to soften the impact of the non-observance of due process. "What is envisioned in Section 16 is not a remedy for arbitrary removal of civil servants enjoying security of tenure but some form of relief for members of the career civil service who may have been or may be legally but involuntarily

'reorganized out' of the service or may have voluntarily resigned pursuant to the reorganization policy" (ibid., p. 615). Reorganization Pursuant to Proclamation No. 3 to Continue Transitorily Even After Ratification By its very context, SECTION 16 envisages the continuance of the reorganization pursuant to Proclamation No. 3 even after ratification of the Constitution and during the transition period. The two [2] stages contemplated, namely, (1) the stage before and (2) after ratification, refer to the same nature of separation "NOT FOR CAUSE but as a result of Proclamation No. 3." No valid reason has been advanced for a different treatment after ratification as the majority opines i.e., that separation NOT FOR CAUSE is allowed before ratification but that, thereafter, separation can only be FOR CAUSE. A fundamental principle of Constitutional construction is to assure the realization of the purpose of the framers of the organic law and of the people who adopted it. That the reorganization commenced pursuant to Proclamation No. 3 was envisioned to continue even after the ratification of the 1987 Constitution, at least transitorily, is evident from the intent of its authors discoverable from their deliberations held on 3 October 1986 and evincing their awareness that such reorganization had not as yet been fully implemented. Thus: Mr. PADILLA. Mr. Presiding Officer, on lines 2 to 5 is the clause 'pursuant to the provisions of Article III of Proclamation No. 3, issued on March 25, 1986, and the reorganization.' Are those words necessary? Can we not just say 'result of the reorganization following the ratification of this Constitution'? In other words, must we make specific reference to Proclamation No. 3? Mr. SUAREZ. Yes. I think the committee feels that is necessary, because in truth there has been a reorganization by virtue of Proclamation No. 3. In other words, there are two stages of reorganization covered by this section. Mr. PADILIA. I understand there is a reorganization committee headed by a minister? Mr. SUAREZ. Philippine Commission on Government Reorganization. Mr. PADILLA. But whether that has already been implemented or not, I do not believe in it. There has been a plan, but I do not think it has been implemented. If we want to include any previous reorganization after or before the ratification, why do we not just say reorganization before or after the ratification' to simplify the provision and eliminate twoand-a-half sentences that may not be necessary? And as a result of the reorganization, if the committee feels there has been reorganization before ratification and there be reorganization after, we just say 'before or after the ratification of this Constitution. Mr. SUAREZ. Something like this as a result of the reorganization effected before or after the ratification of the Constitution on the understanding, with the statement into the records, that this would be applicable to those reorganized out pursuant to the Freedom Constitution also. Mr. PADILLA. That is understood if there has been a reorganization before the ratification or a reorganization after the ratification." (RECORDS of the Constitutional Commission, Vol. 5, p. 416) (Emphasis provided) It should also be recalled that the deadline for the reorganization under Proclamation No. 3 was "one year from February 25, 1986" (Article III, Section 2), or up to February 24, 1987. Executive Order No. 17 itself provided that the review/assessment of personnel be completed "not later

than February 24, 1987." But, confronted with the reality of the ratification of the Constitution before that deadline without reorganization having been completed, there was need for a provision allowing for its continuance even after ratification and until completed. It was also to beat that deadline that EO 127 and similar issuances, providing for the reorganization of departments of government, were all dated 30 January 1987 or prior to the plebiscite held on 2 February 1987. The intent to continue and complete the reorganizations started is self- evident in SECTION 16. In Jose vs. Arroyo, et al. (G.R. No. 78435, August 11, 1987), which was a Petition for certiorari and Prohibition to enjoin the implementation of Executive Order No. 127, we recognized that the reorganization pursuant to Proclamation No. 3 as mandated by SECTION 16, was to continue even after ratification when we stated: The contention of petitioner that EO No. 127 is violative of the provision of the 1987 Constitution guaranteeing career civil service employees security of tenure overlooks the provision of Section 16, Art. XVIII (Transitory Provisions) which explicitly authorizes the removal of career civil service employees not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of the Constitution. By virtue of said provision, the reorganization of the Bureau of Customs under Executive Order No. 127 may continue even after the ratification of this Constitution and career civil service employees may be separated from the service without cause as a result of such reorganization. (Emphasis ours) With due respect to the majority, we disagree with its conclusion that the foregoing pronouncement is mere "obiter dictum." An obiter dictum or dictum has been defined as a remark or opinion uttered, by the way. It is a statement of the court concerning a question which was not directly before it (In re Hess 23 A. 2d. 298, 301, 20 N.J. Misc. 12). It is language unnecessary to a decision, (a) ruling on an issue not raised, or (an) opinion of a judge which does not embody the resolution or determination of the court, and is made without argument or full consideration of the point (Lawson v. US, 176 F2d 49, 51, 85 U.S. App. D.C. 167). It is an expression of opinion by the court or judge on a collateral question not directly involved, (Crescent Ring Co. v. Travelers Indemnity Co. 132 A. 106, 107, 102 N.J. Law 85) or not necessary for the decision Du Bell v. Union Central Life Ins. Co., 29, So. 2d 709, 712; 211 La. 167). In the case at bar, however, directly involved and squarely before the Court was the issue of whether EO 127 violates Section 2(3) of Article IX-B of the 1987 Constitution against removal of civil service employees except for cause." Petitioner batted for the affirmative of the proposition, while respondents contended that "removal of civil service employees without cause is allowed not only under the Provisional Constitution but also under the 1987 Constitution if the same is made pursuant to a reorganization after the ratification of the Constitution." It may be that the Court dismissed that Petition for being premature, speculative and purely anticipatory" inasmuch as petitioner therein had "not received any communication terminating or threatening to terminate his services." But that was only one consideration. The Court still proceeded to decide all the issues adversatively contested by the parties, namely "1) that the expiration date of February 25, 1 987 fixed by Section 2 of Proclamation No. 3 on which said Executive order is based had already lapsed; 2) that the Executive Order has not been published in the Official Gazette as required by Article 2 of the Civil Code and Section 1 1 of the Revised Administrative Code; and 3) that its enforcement violates Section 2(3) of Article IX B of the 1987 Constitution against removal of civil service employees except for cause."

The ruling of the Court, therefore, on the Constitutional issues presented, particularly, the lapse of the period mandated by Proclamation No. 3, and the validity of EO 127, cannot be said to be mere "obiter." They were ultimate issues directly before the Court, expressly decided in the course of the consideration of the case, so that any resolution thereon must be considered as authoritative precedent, and not a mere dictum (See Valli v. US, 94 F2d 687 certiorari granted 58 S. Ct. 760, 303 U.S. 82 L. Ed. 1092; See also Weedin v. Tayokichi Yamada 4 F. (2d) 455). Such resolution would not lose its value as a precedent just because the disposition of the case was also made on some other ground.
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.....And this rule applies as to all pertinent questions although only incidentally involved, which are presented and decided in the regular course of the consideration of the case, and lead up to the final conclusion (Northern Pac. Ry Co. v. Baker, D.C. Wash., 3 F. Suppl. 1; See also Wisconsin Power and Light Co. v. City of Beloit 254 NW 119; Chase v. American Cartage Co. 186 N.W. 598; City of Detroit, et al. v. Public Utilities Comm. 286 N.W. 368). Accordingly, a point expressly decided does not lose its value as a precedent because the disposition of the case is made on some other ground. (Wagner v. Com Products Refining Co. D.C. N.J. 28 F 2d 617) Where a case presents two or more points, any one of which is sufficient to determine the ultimate issue, but the court actually decides all such points, the case is an authoritative precedent as to every point decided, and none of such points can be regarded as having merely the status of a dictum (See U.S. Title Insurance and Trust Co., Cal., 44 S. Ct. 621, 265 U.S. 472, 68 L. Ed. 1110; Van Dyke v. Parker 83 F. (2d) 35) and one point should not be denied authority merely because another point was more dwelt on and more fully argued and considered. (Richmond Screw Anchor Co. v. U.S. 48 S. Ct. 194, 275 U.S. 331, 72 L. Ed. 303)" It is true that in Palma-Fernandez vs. de la Paz (G.R. No. 78946, April 15, 1986, 160 SCRA 751), we had stated: The argument that, on the basis of this provision (Section 26 of Executive Order No. 119, or the 'Reorganization Act of the Ministry of Health'), petitioner's term of office ended on 30 January 1987 and that she continued in the performance of her duties merely in a hold-over capacity and could be transferred to another position without violating any of her legal rights, is untenable. The occupancy of a position in a hold-over capacity was conceived to facilitate reorganization and would have lapsed on 25 February 1987 (under the Provisional Constitution), but advanced to 2 February 1987 when the 1987 Constitution became effective (De Leon, et al., vs. Hon. Esguerra, et al., G.R. No. 78059, 31 August 1987, 153 SCRA 602). After the d date the provisions of the latter on security of tenure govern. The factual situation in the two cases, however, radically differ. In the cited case, Dra. PalmaFernandez, the petitioner, had already been extended a permanent appointment as Assistant Director for Professional Services of the East Avenue Medical Center but was still being transferred by the Medical Center Chief to the Research Office against her consent. Separation from the service as a result of reorganization was not involved. The question then arose as to whether the latter official had the authority to transfer or whether the power to appoint and remove subordinate officers and employees was lodged in the Secretary of Health. Related to that issue was the vital one of whether or not her transfer, effected on 29 May 1987, was tantamount to a removal without cause. Significant, too, is the fact that the transfer was basically made "in the interest of the service" pursuant to Section 24(c) of PD No. 807, or the Civil Service Decree, and not because she was being reorganized out by virtue of EO 119 or the "Reorganization Act of the Ministry of Health," although the said Act was invoked after the fact. And so it was that SECTION 16 was never mentioned, much less invoked in the PalmaFernandez case. Finally, on this point, it is inaccurate for the majority to state that there were no reorganization orders after ratification. There were, namely, EO 181 (Reorganization Act of the Civil Service Commission), June 1, 1987; EO 193 (Reorganization Act of the Office of Energy Affairs), June

10, 1987; EO 230 (Reorganization Act of NEDA), July 22, 1987; EO 262 (Reorganization Act of the Department of Local Government), July 25, 1987; EO 297 (Reorganization Act of the Office of the Press Secretary), July 25, 1987. The Element of Good Faith The majority concedes that reorganization can be undertaken provided it be in good faith but concludes that Commissioner Mison was not in good faith. The aforesaid conclusion is contradicted by the records. Executive Order No. 127, dated 30 January 1987, specifically authorized the reorganization of the Bureau of Customs "structurally and functionally" and provided for the abolition of all units and positions thereof not included in the structural organization S election 55). As stated heretofore, it was the former Commissioner of Customs, Alexander A. Padilla who, on 24 May 1987, transmitted to the Department of Finance for approval the proposed "position structure and staffing pattern" of the Bureau of Customs. This was approved by the Department of Finance. Thereafter, it was transmitted to and approved by the Department of Budget and Management on 7 September 1987 for implementation. Under the old staffing pattern, there were 7,302 positions while under the new staffing pattern, there are 6,530 positions. On 2 October 1987 "Malacanang Memorandum Re: Guidelines on the Implementation of Reorganization Executive Orders" provided: By October 21, 1987, all employees covered by the Executive orders for each agency on reorganization shall be: a. informed of their reappointment, or b. offered another position in the same department or agency, or c. informed of their termination. (emphasis supplied) On 25 November 1987 Commissioner Mison asked for and was granted by the President an extension up to February 1988 within which to completely undertake the reorganization of the Bureau of Customs. On 6 January 1988, he issued Bureau of Customs Memorandum "Re Guidelines on the Implementation of Reorganization Executive Orders" reiterating the above- quoted portion of the Malacanang Memorandum of 2 October 1987. Pursuant thereto, on 28 January 1988, Commissioner Mison addressed uniform letters of termination to the employees listed on pages 15, 16 and 17 of the majority opinion, effective on 28 February 1988, within the extended period granted. The records further show that upon Commissioner Mison's official inquiry, Secretary of Justice Sedfrey A. Ordo;ez, rendered the following Opinion: . . . It is believed that customs employees who are reorganized out in the course of the implementation of E.O. No. 127 (reorganizing the Department of Finance) need not be informed of the nature and cause of their separation from the service. It is enough that they be 'informed of their termination' pursuant to section 1(c) of the Memorandum dated October 2, 1987 of President Aquino, which reads:

1. By October 21, 1987, all employees covered by the Executive orders for each agency on reorganization shall be: xxx c) Informed of their terminations. The constitutional mandate that 'no officer or employee of the civil service shall be renewed or suspended except for cause as provided by law' (Sec. 2(4) (sic), Article IX-B of the 1987 Constitution) does not apply to employees who are separated from office as a result of the reorganization of that Bureau as directed in Executive Order No. 127. xxx xxx xxx xxx xxx

Regarding your (third) query, the issue as to the constitutionality of Executive Order No. 127 is set at rest, after the Supreme Court resolved to dismiss the petition for certiorari questioning its enforceability, for lack of merit (see Jose vs. Arroyo, et al., supra). (Opinion No. 41, s. 1988, March 3, 1988) (Emphasis supplied) The former Chairman of the Civil Service Commission, Celerina G. Gotladera likewise periodically consulted by Commissioner Mison, also expressed the opinion that "it is not a prerequisite prior to the separation of an employee pursuant to reorganization that he be administratively charged." (Annex 16, p. 411, Rollo, G.R. No. 85310) Moreover, the records show that the final selection and placement of personnel was done by a Placement Committee, one of whose members is the Head of the Civil Service Commission Field Office, namely, Mrs. Purificacion Cuerdo The appointment of employees made by Commissioner Mison was based on the list approved by said Placement Committee. But the majority further faults Mison for defying the President's directive to halt further layoffs as a consequence of reorganization, citing OP Memo of 14 October 1987, reading: Further to the Memorandum dated October 2, 1987 on the same subject, I have ordered that there will be no further layoffs this year of personnel as a result of the government reorganization. (p. 45, Decision) The foregoing, however, must be deemed superseded by later developments, namely, the grant to Commissioner Mison by the President on 22 December 1987 of a grace period until the end of February 1988 within which to completely undertake the reorganization of the Bureau of Customs, which was, in fact, accomplished by 28 February 1988. To further show lack of good faith, the majority states that Commissioner Mison failed to observe the procedure laid down by EO 17, supra, directing inter alia that a notice of separation be issued to an employee to be terminated indicating therein the reason/s or ground/s for such separation. That requirement, however, does not appear in Section 59 of EO 127, which provides on the contrary "that those incumbents whose positions are not included in the new position structure and staffing pattern of the Ministry or who are not reappointed shall be deemed separated from the service." The right granted by EO 17 to an employee to be informed of the ground for his separation must be deemed to have been revoked by the repealing clause of EO 127 (Section 67) providing that "all laws, ordinances or parts thereof, which are inconsistent with this Executive Order, are hereby repealed and modified accordingly." Moreover, Section 11 of EO 17 explicitly excepts from its coverage a reorganization pursuant to EO 5. Thus

The Executive Order shall not apply to elective officials or those designated to replace them, presidential appointees, casual and contractual employees, or officials and employees removed pursuant to desciplinary proceedings under the Civil Service law and rules, and to those laid off as a result of reorganization undertaken pursuant to Executive Order No. 5. (Emphasis ours) That EO 127 was issued pursuant to or in implementation of EO 5, is shown by its introductory portion reading: Recalling that the reorganization of the government is mandated expressly by Article II, Section 1 (a) and Article III of the Freedom Constitution; Having in mind that pursuant to Executive order No. 5 (1986), it is directed that the necessary and proper changes in the organizational and functional structures of the government, its agencies and instrumentalities, be effected in order to promote efficiency and effectiveness in the delivery of public service; (Italics supplied) Constitutionality of Republic Act No. 6656 The majority also relies on Republic Act No. 6656 entitled an "Act to Protect the Security of Tenure of Civil Service Officers and Employees in the Implementation of Government Reorganization," particularly Section 2 thereof, to test the good faith of Commissioner Mison. We are of the view, however, that in providing for retroactivity in its Section 13, RA 6656 clashes frontally with SECTION 16. 1) SECTION 16 clearly recognizes that career service employees separated from the service by reason of the "complete reorganization of the government" pursuant to Proclamation No. 3 may be separated NOT FOR CAUSE. And yet, RA 6656 requires the exact opposite separation FOR CAUSE. It would not be remiss to quote the provision again: SEC. 2. No officer or employee in the career service shall be removed except for a valid cause and after due notice and hearing. A valid cause for removal exist when, pursuant to a bona fide reorganization, a position has been abolished or rendered redundant or there is a need to merge, divide, or consolidate positions in order to meet the exigencies of the service, or other lawful causes allowed by the Civil Service law. The existence of any or some of the following circumstances may be considered as evidence of bad faith in the removals made as a result of reorganization, giving rise to a claim for reinstatement or reappointment by an aggrieved party: (a) Where there is a significant increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) Where an office is abolished and another performing substantially the same functions is created; (c) Where incumbents are replaced by those less qualified in terms of status of appointment, performance and merit; (d) Where there is a reclassification of offices in the department or agency concerned and the reclassified offices perform substantially the same functions as the original offices; (e) Where the removal violates the order of separation provided in Section 3 hereof. (Republic Act No. 6156) The standards laid down are the "traditional" criteria for removal of employees from the career service, e.g. valid cause, due notice and hearing, abolition of, or redundancy of offices. Proclamation No. 3, on the other hand, effectuates the "progressive" type of reorganization dictated by the exigencies of the historical and political upheaval at the time. The "traditional" type is limited in scope. It is concerned with the individual approach where the particular employee involved is charged administratively and where the requisites of notice and hearing have to be observed. The "progressive" kind of reorganization, on the other hand, is the collective way. It is wider in scope, and is the reorganization contemplated under SECTION 16.

2) By providing for reinstatement in its Section 9, RA 6656 adds a benefit not included in SECTION 16. The benefits granted by the latter provision to employees separated NOT FOR CAUSE but as a consequence of reorganization are "separation pay, retirement, and other benefits accruing to them under the laws of general application in force at the time of their separation." The benefit of reinstatement is not included. RA 6656, however, allows reinstatement. That it cannot do because under SECTION 16, it is not one of the laws "in force at the time of their separation." The Constitution is the paramount law to which all laws must conform. It is from the Constitution that all statutes must derive their bearings. The legislative authority of the State must yield to the expression of the sovereign will. No statutory enactment can disregard the Charter from which it draws its own existence (Phil. Long Distance Telephone Co. v. Collector of Internal Revenue, 90 Phil. 674 [1952]). But, that is exactly what RA 6656 does in providing for retroactivity it disregards and contravenes a Constitutional imperative. To save it, it should be applied and construed prospectively and not retroactively notwithstanding its explicit provision. Then, and only then, would it make good law. Effects of Reorganization To be sure, the reorganization could effect the tenure of members of the career service as defined in Section 5, Article IV of Presidential Decree No. 807, and may even result in the separation from the office of some meritorious employees. But even then, the greater good of the greatest number and the right of the citizenry to a good government, and as they themselves have mandated through the vehicle of Proclamation No. 3, provide the justification for the said injury to the individual. In terms of values, the interest of an employee to security of tenure must yield to the interest of the entire populace and to an efficient and honest government. But a reorganized employee is not without rights. His right lies in his past services, the entitlement to which must be provided for by law. EO 127 provides for the same in its Section 59, and so does SECTION 16 when the latter specified that career civil service employees separated from the service not for cause: shall be entitled to appropriate separation pay and to retirement and other benefits accruing to them under the laws of general application in force at the time of their separation. In lieu thereof, at the option of the employees, they may be considered for employment in the Government or in any of its subdivisions, instrumentalities, or agencies, including government-owned or controlled corporations and their subsidiaries. This provision also applies to career officers whose resignation, tendered in line with the existing policy, has been accepted. This is a reward for the employee's past service to the Government. But this is all There is no vested property right to be reemployed in a reorganized office. The right to an office or to employment with government or any of its agencies is not a vested property right, and removal therefrom will not support the question of due process" Yantsin v. Aberdeen, 54 Wash 2d 787, 345 P 2d 178). A civil service employee does not have a constitutionally protected right to his position, which position is in the nature of a public office, political in character and held by way of grant or privilege extended by government; generally he has been held to have no property right or vested interest to which due process guaranties extend (See Taylor v. Beckham 178 U.S. 548, 44 L Ed. 1187; Angilly v. US CA2 NY 199 F 2d 642; People ex. rel. Baker v. Wilson, 39 III App 2d 443, 189 NE 2d 1; Kelliheller v. NY State Civil Service Com 21 Misc 2d 1034, 194 NYS 2d 89). To ensure, however, that no meritorious employee has been separated from the service, there would be no harm, in fact, it could do a lot of good, if the Commissioner of Customs reviews the

evaluation and placements he has so far made and sees to it that those terminated are included in a consolidated list to be given preference by departments who are recruiting (Section 2[a], BOC Memorandum, January 6,1988). Conclusion Premises considered, and subject to the observation hereinabove made, it is our considered view that the separation from the service "NOT FOR CAUSE but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986" of the affected officers and employees of the Bureau of Customs should be UPHELD, and the Resolutions of the Civil Service Commission, dated 30 June 1988, 20 September 1988, and 16 November 1988 should be SET ASIDE for having been issued in grave abuse of discretion. Republic Act No. 6656, in so far as it provides for retroactivity, should be declared UNCONSTITUTIONAL for being repugnant to the letter and spirit of Section 16, Article XVIII of the 1987 Constitution. Fernan, C.J., Narvasa, Feliciano, Regalado, JJ., concur.

Footnotes
1

Proc No. 3, (PROVISIONAL CONST.), art. II, sec. l(a). Supra, art. III, secs. 1-4. Proc. No. 1 (1986). CONST. (1986), supra, art. 1, sec. 3. Supra.

The various "OIC cases", among them, Sots v. Pimentel, G.R. No. 73970, April 10, 1986; Palma v. Fortich, G.R. No. 59679, January 29, 1987; Ignacio v. Banata, G.R. No. 74720, August 31, 1987; Association of Barangay Councils of Las Pinas v. Juntilla, G.R. No. 78965, November 17, 1987; Ramos v. Lorenzana, G.R. No. 80282, November 26, 1987; Del Monte v. Ferrer, G.R. 78963, January 13, 1988; Yasay v. Flores, G.R. No. 81047, January 7, 1988; ending with De Leon v. Esguerra, No. 78059, August 31, 1987, 153 SCRA 602.
7

Jose v. Arroyo, G.R. No. 78435, August 11, 1987; Palma Fernandez v. De la Paz, No. 78496, August 15, 1988, 160 SCRA 751.
8

Exec. Ord. No. 17, sec. 3. 88 O.G. 2009-2024 (Apr., 1987). Exec. Ord. No. 127, supra, secs. 33-38.

10

11

De Leon v. Esguerra, supra. The writer of this opinion dissented, and maintained that the new Constitution was ratified on February 11, 1987.
12

Rollo, G.R. No. 85310, 317-31.

13

Id., 317. Id., 8.

14

15

Rollo, G.R. No. 81954, 24; rollo, G.R. No. 81967, 27; rollo, G.R. No. 82023, 37; see also rollo, id., G.R. No. 85310, 8.
16

The last eighteen are the successful employees in the appeal with the Civil Service Commission (subject of G.R. No. 85310) whose reinstatement the Commission ordered pending further proceedings herein. We consider them impleaded as parties respondents in G.R. No. 85310. Also, the Customs employees involved have been impleaded as parties in more than one petition either as petitioners or respondents.
17

Rollo, id., G.R. No. 85310, 8; according, however, to the petitioners in G.R. 86241, a total of 397 employees were terminated. id., 260; former Sen. Ambrosio Padilla, amicus curiae, placed the figure at 493 (G.R. No. 85310, id., 993).
18

Rollo, id., G.R. No. 85310, 79; also rollo, G.R. No. 85335, 36. Rollo, id., G.R. No. 85310, 424 Rollo, G.R. No. 86241, 144

19

20

21

Senen Dimaguila and Romulo Badillo earlier instituted in this Court G.R. Nos. 81968 and 81955 but were allowed, by our Resolution of July 5, 1988, to withdraw and join the appeal subject of the Civil Service Commission's Resolution of November 11, 1988, See rollo, G.R. No. 82023, 169
22

84 O.G. Supp. 1-4 (June, 1988). Supra, 3. CONST. (1987), art. XVIII, sec. 16.

23

24

25

This was raised by the Civil Service Commission in G.R. No. 86241. Failure to exhaust administrative remedies was raised in G.R. No. 81954 and 81917 by the Solicitor General.
26

Sarmiento III v. Mison, No. L-79974, December 17, 1987, 153 SCRA 549, 551-552.

Pres. Decree No. 807, sec. 39. The provision reads: "Appeals. (a) Appeals, where allowable, shall be made by the party adversely affected by the decision within fifteen days from receipt of the decision unless a petition for reconsideration is seasonably filed, which petition shall be decided within fifteen days. Notice of the appeal shall be filed with the disciplining office, which shall forward the records of the case, together with the notice of appeal, to the appellate authority within fifteen days from filing of the notice of appeal, with its comment, if any. The notice of appeal shall specifically state the date of the decision appealed from and the date of receipt thereof. It shall also specifically set forth clearly the grounds relied upon for excepting from the decision; (b) A petition for reconsideration shall be based only on any of the following grounds: (1) new evidence has been discovered which materially affects the decision rendered; (2) the decision is not supported by the evidence on record; or (3) errors of law or irregularities have been committed prejudicial to the interest of the respondent; Provided, That only one petition for reconsideration shall be entertained."
27

28

Rep. Act No. 6656, supra, sec. 8. The provision reads: "Sec. 8. An officer or employee who is still not satisfied with the decision of the appointing authority may further appeal with ten (10) days from receipt thereof to the Civil Service Commission which shall render a decision thereon within thirty (30) days and whose decision shall be final and executory."
29

CONST., art. IX, sec, 7. The provision reads: "Sec. 7. Each Commission shall decide by a majority vote of all its Members any case or matter brought before it within sixty days from the date of its submission for decision or resolution. A case or matter is deemed submitted for decision or resolution upon the filing of the last pleading, brief, or memorandum required by the rules of the Commission or by the Commission itself. Unless otherwise provided by this Constitution or by law, any decision, order, or ruling of each Commission may be brought to the Supreme Court on certiorari by the aggrieved party within thirty days from receipt of a copy thereof.
30

Rollo, id., G.R. No. 85310, 82. id., 415. CONST. (1987), supra.

31

32

33

See Aratuc v. Commission on Elections, Nos. L-49705-09, 49717-21, February 8, 1979, 88 SCRA 251.
34

Supra, 271. Supra. Aratuc supra, 270.

35

36

37

CONST. (1987), supra, art. IX sec. 2(2). To be more precise, the 1987 Constitution gives the Commission "exclusive original jurisdiction over all [election] contests.'
38

Supra, art. IX, sec. 7. Aratuc supra, 271; emphasis supplied. Rep. Act No. 6656, supra, sec. 8. RULES OF COURT, Rule 65, sec. 1. CONST. (1987), art. IX, sec. 7, supra.

39

40

41

42

43

Phil. American Life Ins. Co. vs. Social Security Com No. L-20383, May 24, 1967, 20 SCRA 162,
44

Exec. Ord. No. 127, supra, sec. 59. Supra. Rollo, id., G.R. No. 81954, 36. Exec. Ord. No. 127, supra, see. 34; rollo, id., G.R. No. 81954.

45

46

47

48

Exec. Ord. No. 127, supra, sec. 59. Rollo, id., G.R. No. 81954,12; emphasis in the original. CONST. (1986), Supra, art. IX, sec. 2. CONST. (1987), supra, art. IXB sec. 2(3). August 8, 1986. Supra, sec. 1(a) G.R. No. 78435, August 11, 1987. Supra, 3. CONST. (1987), supra, art. XVIII, sec. 16.

49

50

51

52

53

54

55

56

57

Rollo, id., G.R. No. 81954, 216; rollo, id., G.R. No. 81967, 64; rollo, id., G.R. No. 82023, 76.
58

Supra. See Exec. Ord. No. 17, supra, sec. 1. Rollo, id., G.R. No. 85310, 18; rollo, id., G.R. No. 86241, 14. Id.; id., 13. Id., 37; id., 33. CONST. (1987), art. XVIII, sec. 16, supra. See fn. 11. CONST. (1935), art. XVI, sec. 4. CONST. (1973), art. XVII, sec. 9. CONST. (1986); art. III, sec. 2, supra.

59

60

61

62

63

64

65

66

67

68

Ginson v. Municipality of Murcia, No. L-46585, February 8, 1988, 157 SCRA 1; De la Llana v. Alba, No. 57883, March 12, 1982, 112 SCRA 294; Cruz v. Primicias Jr., No. L28573, June 13, 1968, 23 SCRA 998.
69

III RECORD OF THE CONSTITUTIONAL COMMISSION, 1615-1616 (1986). De Leon v. Esguerra, supra; Palma-Fernandez v. De la Paz, supra. Exec. Ord. No. 17, supra.

70

71

Paradoxically, Executive Order No. 17 would have provided a "cause" for removal.

72

OP Memo (October 14, 1987). Supra, see fn. 7. Arroyo, supra, 3. The petitioner was Leonardo Jose, a Collector III at the Bureau of Customs. Supra, 2. 55 Phil. 565 (1930). Supra. Art. III, sec. 1 and art. IX(B) sec. 2(3).

73

74

75

76

77

78

79

80

Supra. In Palma-Fernandez, we upheld claims of authority of tenure in the absence of a bona fidereorganization. In that case, there was no valid abolition of an office but merely, a change in name of position. We did not foreclose therein the validity of a removal "not for cause," provided that there is a valid reorganization.
81

Ginson v. Municipality of Murcia, supra; De la Llana v. Alba, supra; Cruz v. Primicias Jr., supra.
82

Palma Fernandez, supra. In that case, the office of "Chief of Clinic' was purportedly abolished and in its place an office of "Assistant Director for Professional Services" was created. We held that the two positions "are basically one and the same except for the change of nomenclature (767.)
83

Ginson supra; Cruz, supra.

**

Although as we also said, Executive Order No. 17 itself imposed a "cause" for removals under the Freedom Constitution.
84

Rep. Act No. 6156, supra. See G.R. Nos. 81964, 81967, id., 10-11. G.R. No. 86421, id., 31. OP Memo (Oct., 14, 1987), supra.

85

86

87

88

See Free Telephone Workers Union v. Minister of Labor and Employment, No. 58184, October 30, 1981, 1108 SCRA 757.
89

Supra. With respect to Vicente Feria, Jr., the records reveal that his appointment was extended on April 22, 1986. (G.R. No. 81967, id., 7.) For that reason, he cannot be said to be an "incumbent" for purposes of reorganization, to whom a reappointment may be issued. Because his appointment came after the promulgation of the Freedom Constitution, he is, to all intents and purposes, an appointee as a result of reorganization.
90

Supra, 757. Supra, sec. 9.

91

92

Supra, sec. 13. Supra, sec. 2.

93.

Melencio-Herrera, J.:
1

Executive Orders Nos. 11 6 (Agriculture and Food); 117 Education Culture and Sports); 119 (Health); 120 (Tourism); 123 (Social Welfare and Development); 124 (Public Works and Highways); 125 (Transportation and Communication); 126 (Labor and Employment); 128 (Science and Technology; 129 (Agrarian Reform); 131 (Natural Resources); 132 (Foreign Affairs); and 133 (Trade and Industry).
The Lawphil Project - Arellano Law Foundation

CONTE VS.COA

EN BANC

[G.R. No. 116422. November 4, 1996]

AVELINA B. CONTE and LETICIA BOISER-PALMA, petitioners, vs. COMMISSION ON AUDIT (COA), respondent. DECISION
PANGANIBAN, J.:

Are the benefits provided for under Social Security System Resolution No. 56 to be considered simply as financial assistance for retiring employees, or does such scheme constitute a supplementary retirement plan proscribed by Republic Act No. 4968? The foregoing question is addressed by this Court in resolving the instant petition for certiorari which seeks to reverse and set aside Decision No. 94-126[1]dated March 15, 1994 of respondent Commission on Audit, which denied petitioners request for reconsideration of its adverse ruling disapproving claims for financial assistance under SSS Resolution No. 56.

The Facts Petitioners Avelina B. Conte and Leticia Boiser-Palma were former employees of the Social Security System (SSS) who retired from government service on May 9, 1990 and September 13, 1992, respectively. They availed of compulsory retirement benefits under Republic Act No. 660.[2] In addition to retirement benefits provided under R.A. 660, petitioners also claimed SSS financial assistance benefits granted under SSS Resolution No. 56, series of 1971. A brief historical backgrounder is in order. SSS Resolution No. 56,[3] approved on January 21, 1971, provides financial incentive and inducement to SSS employees qualified to retire to avail of retirement benefits under RA 660 as amended, rather than the retirement benefits under RA 1616 as amended, by giving them financial assistance equivalent in amount to the difference between what a retiree would have received under RA 1616, less what he was entitled to under RA 660. The said SSS Resolution No. 56 states:

RESOLUTION NO. 56

WHEREAS, the retirement benefits of SSS employees are provided for under Republic Acts 660 and 1616 as amended; WHEREAS, SSS employees who are qualified for compulsory retirement at age 65 or for optional retirement at a lower age are entitled to either the life annuity under R.A. 660, as amended, or the gratuity under R.A. 1616, as amended; WHEREAS, a retirement benefit to be effective must be a periodic income as close as possible to the monthly income that would have been due to the retiree during the remaining years of his life were he still employed; WHEREAS, the life annuity under R.A. 660, as amended, being closer to the monthly income that was lost on account of old age than the gratuity under R.A. 1616, as amended, would best serve the interest of the retiree; WHEREAS, it is the policy of the Social Security Commission to promote and to protect the interest of all SSS employees, with a view to providing for their wellbeing during both their working and retirement years; WHEREAS, the availment of life annuities built up by premiums paid on behalf of SSS employees during their working years would mean more savings to the SSS; WHEREAS, it is a duty of the Social Security Commission to effect savings in every possible way for economical and efficient operations; WHEREAS, it is the right of every SSS employee to choose freely and voluntarily the benefit he is entitled to solely for his own benefit and for the benefit of his family; NOW, THEREFORE, BE IT RESOLVED, That all the SSS employees who are simultaneously qualified for compulsory retirement at age 65 or for optional retirement at a lower age be encouraged to avail for themselves the life annuity under R.A. 660, as amended; RESOLVED, FURTHER, That SSS employees who availed themselves of the said life annuity, in appreciation and recognition of their long and faithful service, be granted financial assistance equivalent to the gratuity plus return of contributions under R.A. 1616, as amended, less the five year guaranteed annuity under R.A. 660, as amended; RESOLVED, FINALLY, That the Administrator be authorized to act on all applications for retirement submitted by SSS employees and subject to availability of funds, pay the corresponding benefits in addition to the money value of all accumulated leaves. (underscoring supplied)

Long after the promulgation of SSS Resolution No. 56, respondent Commission on Audit (COA) issued a ruling, captioned as 3rd Indorsement dated July 10, 1989,[4] disallowing in audit all such claims for financial assistance under SSS Resolution No. 56, for the reason that: --

x x x the scheme of financial assistance authorized by the SSS is similar to those separate retirement plan or incentive/separation pay plans adopted by other government corporate agencies which results in the increase of benefits beyond what is allowed under existing retirement laws. In this regard, attention x x x is invited to the view expressed by the Secretary of Budget and Management dated February 17, 1988 to the COA General Counsel against the proliferation of retirement plans which, in COA Decision No. 591 dated August 31, 1988, was concurred in by this Commission. x x x. Accordingly, all such claims for financial assistance under SSS Resolution No. 56 dated January 21, 1971 should be disallowed in audit. (underscoring supplied)
Despite the aforequoted ruling of respondent COA, then SSS Administrator Jose L. Cuisia, Jr. nevertheless wrote[5] on February 12, 1990 then Executive Secretary Catalino Macaraig, Jr., seeking presidential authority for SSS to continue implementing its Resolution No. 56 dated January 21, 1971 granting financial assistance to its qualified retiring employees. However, in a letter-reply dated May 28, 1990,[6] then Executive Secretary Macaraig advised Administrator Cuisia that the Office of the President is not inclined to favorably act on the herein request, let alone overrule the disallowance by COA of such claims, because, aside from the fact that decisions, order or actions of the COA in the exercise of its audit functions are appealable to the Supreme Court[7] pursuant to Sec. 50 of PD 1445, the benefits under said Res. 56, though referred to as financial assistance, constituted additional retirement benefits, and the scheme partook of the nature of a supplementary pension/retirement plan proscribed by law. The law referred to above is RA 4968 (The Teves Retirement Law), which took effect June 17, 1967 and amended CA 186 (otherwise known as the Government Service Insurance Act, or the GSIS Charter), making Sec. 28 (b) of the latter act read as follows:

(b) Hereafter, no insurance or retirement plan for officers or employees shall be created by employer. All supplementary retirement or pension plans heretofore in force in any government office, agency or instrumentality or corporation owned or controlled by the government, are hereby declared inoperative or abolished; Provided, That the rights of those who are already eligible to retire thereunder shall not be affected. (underscoring supplied)
On January 12, 1993, herein petitioners filed with respondent COA their letterappeal/protest[8] seeking reconsideration of COAs ruling of July 10, 1989 disallowing claims for financial assistance under Res. 56.

On November 15, 1993, petitioner Conte sought payment from SSS of the benefits under Res. 56. On December 9, 1993, SSS Administrator Renato C. Valencia denied[9] the request in consonance with the previous disallowance by respondent COA, but assured petitioner that should the COA change its position, the SSS will resume the grant of benefits under said Res. 56. On March 15, 1994, respondent COA rendered its COA Decision No. 94-126 denying petitioners request for reconsideration. Thus this petition for certiorari under Rule 65 of the Rules of Court.

The Issues The issues[10] submitted by petitioners may be simplified and re-stated thus: Did public respondent abuse its discretion when it disallowed in audit petitioners claims for benefits under SSS Res. 56? Petitioners argue that the financial assistance under Res. 56 is not a retirement plan prohibited by RA 4968, and that Res. 56 provides benefits different from and aside from what a retiring SSS employee would be entitled to under RA 660. Petitioners contend that it is a social amelioration and economic upliftment measure undertaken not only for the benefit of the SSS but more so for the welfare of its qualified retiring employees. As such, it should be interpreted in a manner that would give the x x x most advantage to the recipient -- the retiring employees whose dedicated, loyal, lengthy and faithful service to the agency of government is recognized and amply rewarded -- the rationale for the financial assistance plan. Petitioners reiterate the argument in their letter dated January 12, 1993 to COA that:

Motivation can be in the form of financial assistance, during their stay in the service or upon retirement, as in the SSS Financial Assistance Plan. This is so, because Government has to have some attractive remuneration programs to encourage well-qualified personnel to pursue a career in the government service, rather than in the private sector or in foreign countries ... A more developmental view of the financial institutions grant of certain forms of financial assistance to its personnel, we believe, would enable government administrators to see these financial forms of remuneration as contributory to the national developmental efforts for effective and efficient administration of the personnel programs in different institutions.
[11]

The Courts Ruling Petitioners contentions are not supported by law. We hold that Res. 56 constitutes a supplementary retirement plan. A cursory examination of the preambular clauses and provisions of Res. 56 provides a number of clear indications that its financial assistance plan constitutes a

supplemental retirement/pension benefits plan. In particular, the fifth preambular clause which provides that it is the policy of the Social Security Commission to promote and to protect the interest of all SSS employees, with a view to providing for their well-being during both their working and retirement years, and the wording of the resolution itself which states Resolved, further, that SSS employees who availed themselves of the said life annuity (under RA 660), in appreciation and recognition of their long and faithful service, be granted financial assistance x x x can only be interpreted to mean that the benefit being granted is none other than a kind of amelioration to enable the retiring employee to enjoy (or survive) his retirement years and a reward for his loyalty and service. Moreover, it is plain to see that the grant of said financial assistance is inextricably linked with and inseparable from the application for and approval of retirement benefits under RA 660, i.e., that availment of said financial assistance under Res. 56 may not be done independently of but only in conjunction with the availment of retirement benefits under RA 660, and that the former is in augmentation or supplementation of the latter benefits. Likewise, then SSS Administrator Cuisias historical overview of the origins and purpose of Res. 56 is very instructive and sheds much light on the controversy: [12]

Resolution No. 56, x x x, applies where a retiring SSS employee is qualified to claim under either RA 660 (pension benefit, that is, 5 year lump sum pension and after 5 years, life time pension), or RA 1616 (gratuity benefit plus return of contribution), at his option. The benefits under RA 660 are entirely payable by GSIS while those under RA 1616 are entirely shouldered by SSS except the return of contribution by GSIS. Resolution No. 56 came about upon observation that qualified SSS employees have invariably opted to retire under RA 1616 instead of RA 660 because the total benefit under the former is much greater than the 5-year lump sum under the latter. As a consequence, the SSS usually ended up virtually paying the entire retirement benefit, instead of GSIS which is the main insurance carrier for government employees. Hence, the situation has become so expensive for SSS that a study of the problem became inevitable. As a result of the study and upon the recommendation of its Actuary, the SSS Management recommended to the Social Security Commission that retiring employees who are qualified to claim under either RA 660 or 1616 should be encouraged to avail for themselves the life annuity under RA 660, as amended, with the SSS providing a financial assistance equivalent to the difference between the benefit under RA 1616(gratuity plus return of contribution) and the 5-year lump sum pension under RA 660. The Social Security Commission, as the policy-making body of the SSS approved the recommendation in line with its mandate to insure the efficient, honest and economical administration of the provisions and purposes of this Act. (Section 3 (c) of the Social Security Law).

Necessarily, the situation was reversed with qualified SSS employees opting to retire under RA No. 660 or RA 1146 instead of RA 1616, resulting in substantial savings for the SSS despite its having to pay financial assistance. Until Resolution No. 56 was questioned by COA. (underscoring part of original text; italics ours)
Although such financial assistance package may have been instituted for noble, altruistic purposes as well as from self-interest and a desire to cut costs on the part of the SSS, nevertheless, it is beyond any dispute that such package effectively constitutes a supplementary retirement plan. The fact that it was designed to equalize the benefits receivable from RA 1616 with those payable under RA 660 and make the latter program more attractive, merely confirms the foregoing finding. That the Res. 56 package is labelled financial assistance does not change its essential nature. Retirement benefits are, after all, a form of reward for an employees loyalty and service to the employer, and are intended to help the employee enjoy the remaining years of his life, lessening the burden of worrying about his financial support or upkeep.[13] On the other hand, a pension partakes of the nature of retained wages of the retiree for a dual purpose: to entice competent people to enter the government service, and to permit them to retire from the service with relative security, not only for those who have retained their vigor, but more so for those who have been incapacitated by illness or accident.[14] Is SSS Resolution No. 56 then within the ambit of and thus proscribed by Sec. 28 (b) of CA 186 as amended by RA 4968? We answer in the affirmative. Said Sec. 28 (b) as amended by RA 4968 in no uncertain terms 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 inequitous proliferation of such plans. It is beyond cavil that Res. 56 contravenes the said provision of law and is therefore invalid, void and of no effect. To ignore this and rule otherwise would be tantamount to permitting every other government office or agency to put up its own supplementary retirement benefit plan under the guise of such financial assistance. We are not unmindful of the laudable purposes for promulgating Res. 56, and the positive results it must have had, not only in reducing costs and expenses on the part of the SSS in connection with the pay-out of retirement benefits and gratuities, but also in improving the quality of life for scores of retirees. But it is simply beyond dispute that the SSS had no authority to maintain and implement such retirement plan, particularly in the face of the statutory prohibition. The SSS cannot, in the guise of rule-making, legislate or amend laws or worse, render them nugatory. It is doctrinal that in case of conflict between a statute and an administrative order, the former must prevail.[15] A rule or regulation must conform to and be consistent with the provisions of the enabling statute in order for such rule or regulation to be valid.[16] The rule-making power of a public administrative body is a delegated legislative power, which it may not use either to abridge the authority given it by the Congress or the Constitution or to enlarge its power beyond the scope intended. Constitutional and statutory provisions control with respect to what rules and regulations may be promulgated by such a body, as well as with respect to what

fields are subject to regulation by it. It may not make rules and regulations which are inconsistent with the provisions of the Constitution or a statute, particularly the statute it is administering or which created it, or which are in derogation of, or defeat, the purpose of a statute.[17] Though well-settled is the rule that retirement laws are liberally interpreted in favor of the retiree,[18] nevertheless, there is really nothing to interpret in either RA 4968 or Res. 56, and correspondingly, the absence of any doubt as to the ultra-vires nature and illegality of the disputed resolution constrains us to rule against petitioners. As a necessary consequence of the invalidity of Res. 56, we can hardly impute abuse of discretion of any sort to respondent Commission for denying petitioners request for reconsideration of the 3rd Indorsement of July 10, 1989. On the contrary, we hold that public respondent in its assailed Decision acted with circumspection in denying petitioners claim. It reasoned thus:

After a careful evaluation of the facts herein obtaining, this Commission finds the instant request to be devoid of merit. It bears stress that the financial assistance contemplated under SSS Resolution No. 56 is granted to SSS employees who opt to retire under R.A. No. 660. In fact, by the aggrieved parties own admission (page 2 of the request for reconsideration dated January 12, 1993), it is a financial assistance granted by the SSS management to its employees, in addition to the retirement benefits under Republic Act No. 660. (underscoring supplied for emphasis) There is therefore no question, that the said financial assistance partakes of the nature of a retirement benefit that has the effect of modifying existing retirement laws particularly R.A. No. 660.
Petitioners also asseverate that the scheme of financial assistance under Res. 56 may be likened to the monetary benefits of government officials and employees who are paid, over and above their salaries and allowances as provided by statute, an additional honorarium in varying amounts. We find this comparison baseless and misplaced. As clarified by the Solicitor General:[19]

Petitioners comparison of SSS Resolution No. 56 with the honoraria given to government officials and employees of the National Prosecution Service of the Department of Justice, Office of the Government Corporate Counsel and even in the Office of the Solicitor General is devoid of any basis. The monetary benefits or honoraria given to these officials or employees are categorized as travelling and/or representation expenses which are incurred by them in the course of handling cases, attending court/administrative hearings, or performing other field work. These monetary benefits are given upon rendition of service while the financial benefits under SSS Resolution No. 56 are given upon retirement from service.
In a last-ditch attempt to convince this Court that their position is tenable, petitioners invoke equity. They believe that they are deserving of justice and equity in their quest for financial assistance under SSS Resolution No. 56, not so much because the SSS is one of the very few stable agencies of government where no doubt this recognition and reputation is earned x x x but more so due to the

miserable scale of compensation granted to employees in various agencies to include those obtaining in the SSS.[20] We must admit we sympathize with petitioners in their financial predicament as a result of their misplaced decision to avail of retirement benefits under RA 660, with the false expectation that financial assistance under the disputed Res. 56 will also materialize. Nevertheless, this Court has always held that equity, which has been aptly described as justice outside legality, is applied only in the absence of, and never against, statutory law or judicial rules of procedure.[21] In this case, equity cannot be applied to give validity and effect to Res. 56, which directly contravenes the clear mandate of the provisions of RA 4968. Likewise, we cannot but be aware that the clear imbalance between the benefits available under RA 660 and those under RA 1616 has created an unfair situation for it has shifted the burden of paying such benefits from the GSIS (the main insurance carrier of government employees) to the SSS. Without the corrective effects of Res. 56, all retiring SSS employees without exception will be impelled to avail of benefits under RA 1616. The cumulative effect of such availments on the financial standing and stability of the SSS is better left to actuarians. But the solution or remedy for such situation can be provided only by Congress. Judicial hands cannot, on the pretext of showing concern for the welfare of government employees, bestow equity contrary to the clear provisions of law. Nevertheless, insofar as herein petitioners are concerned, this Court cannot just sit back and watch as these two erstwhile government employees, who after spending the best parts of their lives in public service have retired hoping to enjoy their remaining years, face a financially dismal if not distressed future, deprived of what should have been due them by way of additional retirement benefits, on account of a bureaucratic boo-boo improvidently hatched by their higher-ups. It is clear to our mind that petitioners applied for benefits under RA 660 only because of the incentives offered by Res. 56, and that absent such incentives, they would have without fail availed of RA 1616 instead. We likewise have no doubt that petitioners are simply innocent bystanders in this whole bureaucratic rule-making/financial scheme-making drama, and that therefore, to the extent possible, petitioners ought not be penalized or made to suffer as a result of the subsequently determined invalidity of Res. 56, the promulgation and implementation of which they had nothing to do with. And here is where equity may properly be invoked: since SSS employees who are qualified for compulsory retirement at age 65 or for optional retirement at a lower age are entitled to either the life annuity under R.A. 660, as amended, or the gratuity under R.A. 1616, as amended,[22] it appears that petitioners, being qualified to avail of benefits under RA 660, may also readily qualify under RA 1616. It would therefore not be misplaced to enjoin the SSS to render all possible assistance to petitioners for the prompt processing and approval of their applications under RA 1616, and in the meantime, unless barred by existing regulations, to advance to petitioners the difference between the amounts due under RA 1616, and the amounts they already obtained, if any, under RA 660. WHEREFORE, the petition is hereby DISMISSED for lack of merit, there having been no grave abuse of discretion on the part of respondent Commission. The assailed Decision of public respondent is AFFIRMED, and SSS Resolution No. 56 is

hereby declared ILLEGAL, VOID AND OF NO EFFECT. The SSS is hereby urged to assist petitioners and facilitate their applications under RA 1616, and to advance to them, unless barred by existing regulations, the corresponding amounts representing the difference between the two benefits programs. No costs. SO ORDERED. Narvasa, C.J., Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Francisco, Hermosisima, Jr., and Torres, Jr., JJ., concur.

[1]

Rollo, pp. 12-14; signed by Chairman Pascasio S. Banaria and Comms. Rogelio B. Espiritu and Sofronio B. Ursal.
[2]

Rollo, p. 3. Rollo, pp. 16-17. Rollo, pp. 18-19. Rollo, pp. 23-26. Rollo, pp. 27-29. Casibang vs. Phil. Tobacco Administration, 128 SCRA 87, March 5, 1984. Rollo, pp. 30-33. Rollo, p. 34. Petition, p. 4; Rollo, p. 5. Petitioners Memorandum, pp. 3-4; Rollo, pp. 64-65 Rollo, pp. 8-9. Letter to Exec. Secretary Macaraig, Jr.; Rollo, pp. 23-24. Aquino vs. NLRC, 206 SCRA 118, February 11, 1992. Cena vs. Civil Service Commission, 211 SCRA 179, 186, July 3, 1992. Kilusang Mayo Uno Labor Center vs. Garcia, Jr., 239 SCRA 386, December 23, 1994. Lina, Jr. vs. Cario, 221 SCRA 515, April 23, 1993.

[3]

[4]

[5]

[6]

[7]

[8]

[9]

[10]

[11]

[12]

[13]

[14]

[15]

[16]

[17]

De Leon and De Leon, Jr., Administrative Law: Text and Cases, 1989 Edition, p. 65, citing 73 C.J.S. 413-414, 416-417.
[18]

Tantuico, Jr. vs. Domingo, 230 SCRA 391, February 28, 1994. Memorandum for the Respondent, pp. 10-11. Rollo, p. 68. Causapin vs. Court of Appeals, 233 SCRA 615, July 4, 1994. Second Whereas clause of Res. 56.

[19]

[20]

[21]

[22]