NOBLEJAS VS.

TEEHANKEE

Noblejas was the commissioner of land registration. Under RA 1151, he is

entitled to the same compensation, emoluments, and privileges as those of
a Judge of CFI. He approved a subdivision plan covering certain areas that
are in excess of those covered by the title

The Secretary of Justice, Teehankee, sent a letter to Noblejas, requiring him

to explain.

Noblejas answered, arguing that since he has a rank equivalent to that of a

Judge, he could only be suspended and investigated in the same manner as
an ordinary Judge, under the Judiciary Act. He claims that he may be
investigated only by the Supreme Court

Nevertheless, he was suspended by the Executive Secretary (ES)

Noblejas filed this case claiming the lack of jurisdiction of the ES and his
abuse of discretion.

ISSUE: Whether the Commissioner of Land Registratoin may only be

investigated by the Supreme Court (in view of his having a rank equivalent to a
judge)?
SC: NO.
If the law had really intended to include the general grant of rank and
privileges equivalent to Judges, the right to be investigated and be suspended
or removed only by the Supreme Court, then such grant of privileges would be
unconstitutional, since it would violate the doctrine of separation of powers
because it would charge the Supreme Court with an administrative function of
supervisory control over executive officials, simultaneously reducing pro tanto,
the control of the Chief Executive over such officials.
There is no inherent power in the Executive or Legislative to charge the
Judiciary with administrative functions except when reasonable incidental to the
fulfillment of judicial duties.
The judiciary cannot give decisions which are merely advisory, nor can it
exercise or participate in the exercise of functions which are essentially
legislative or administrative. The Supreme Court and its members should not
and cannot be required to exercise any power or to perform any trust or to
assume any duty not pertaining to or connected with the administration of
judicial functions.
As such, RA 1151 while conferring the same privileges as those of a judge, did
not include and was not intended to include, the right to demand investigation
by the Supreme Court, and to be suspended or removed only upon the Courts
recommendation. Said rights would be violative of the Constitution.
The suspension of Noblejas by the ES valid.

Also, the resolution of the consulta by a Register of Deeds is NOT a judicial

function, but an administrative process. It is conclusive and binding only upon
the Register of Deeds, NOT the parties themselves. Even if the resolution is
appealable, it does not automatically mean that they are judicial in character.
Still, the resolution of the consultas are but a minimal portion of the
administrative or executive functions.
Garcia vs Macaraig Jr
Facts: Judge Macaraig took his oath as Judge of the CFI of Laguna and San
Pablo City on June 29, 1970. The court, being one of the 112 newly created CFI
branches, had to be organized from scratch. From July 1, 1970 to February 28,
1971, Macaraig was not able to assume the duties and functions of a judge due
to the fact that his Court Room can not be properly established due to problems
as to location and as to appropriations to make his Court up and running.
When Macaraig realized that it would be sometime before he could actually
preside over his court, he applied for an extended leave (during the 16 years he
had worked in the Department of Justice, respondent had, due to pressure of
duties, never gone on extended leave, resulting in his forfeiting all the leave
benefits he had earned beyond the maximum ten months allowed by the law).
The Secretary of Justice, however, prevailed upon respondent to forego his
leave and instead to assist him, without being extended a formal detail,
whenever respondent was not busy attending to the needs of his court. Paz
Garcia on the other hand filed a complaint alleging that Macaraig is
incompetent, dishonest and has acted in violation of his oath as a judge.
Garcia said that Macaraig has not submitted the progress of his Courts as
required by law. And that Macaraig has received salaries as a judge while he is
fully aware that he has not been performing the duties of a judge.
ISSUE: Whether or not Macaraig has acted with incompetence and dishonesty
as Judge.
HELD: Macaraigs inability to perform his judicial duties under the
circumstances mentioned above does not constitute incompetence.
Respondent was, like every lawyer who gets his first appointment to the bench,
eager to assume his judicial duties and rid himself of the stigma of being a
judge without a sala, but forces and circumstances beyond his control
prevented him from discharging his judicial duties. On the other hand, none of
these is to be taken as meaning that the Court looks with favor at the practice
of long standing, to be sure, of judges being detailed in the DOJ to assist the
Secretary even if it were only in connection with his work of exercising
administrative authority over the courts. The line between what a judge may do
and what he may not do in collaborating or working with other offices or
officers under the other great departments of the government must always be
kept clear and jealously observed, lest the principle of separation of powers on
which our government rests by mandate of the people thru the Constitution be
gradually eroded by practices purportedly motivated by good intentions in the
interest of the public service. The fundamental advantages and the necessity of
the independence of said three departments from each other, limited only by
the specific constitutional precepts on check and balance between and among
them, have long been acknowledged as more paramount than the serving of
any temporary or passing governmental conveniences or exigencies. It is thus
of grave importance to the judiciary under our present constitutional scheme of

government that no judge of even the lowest court in this Republic should place
himself in a position where his actuations on matters submitted to him for
action or resolution would be subject to review and prior approval and, worst
still, reversal, before they can have legal effect, by any authority other than the
Court of Appeals or the Supreme Court, as the case may be. Needless to say,
the Court feels very strongly that it is best that this practice is discontinued.
Meralco vs. Pasay Trans Co., 57 Phil. 600 (1932)
Facts:
The case at bar relates with a petition of the Manila Electric Company (MEC,
pet), requesting the members of the SC, sitting as a board of arbitrators, to fix
the terms upon which certain transportation companies shall be permitted to
use the Pasig bridge of the MEC and the compensation to be paid to the MEC by
such transportation companies.Act NO. 1446, Section 11Relates with the legal
act of the members of the SC, sitting as a board of arbitrators, to act on the
petition.
Issue: Concerns the legal right of the members of the SC, sitting as a board of
arbitrators the decision of a majority of whom shall be final, to act in that
capacity.
Held & Ratio: Act 1446, Section 11 contravenes the maxims which guide the
operation of a democratic government constitutionallyestablished, and that it
would be improper and illegal for the members of the SC, sitting as a board or
arbitrators, thedecision of a majority of whom shall be final, to act on the
petition of the MEC.The decisions of the Board of Arbitration shall go through
the regular court system (Trial Courts Court of Appeals SC).They will be
reviewed by the lower courts and will ultimately be reviewed by themselves.
The SC cannot sit as members of the Board of Arbitration because it is not
within their jurisdiction to decided on cases on purely contractual situations.
Puyat vs De Guzman
Political Law Appearance in Court
On 14 May 1979, Puyat and his group were elected as directors of the
International Pipe Industries. The election was subsequently questioned by
Acero (Puyats rival) claiming that the votes were not properly counted hence
he filed a quo warranto proceeding before the Securities and Exchange
Commission on 25 May 1979. Prior to Aceros filing of the case, Estanislao
Fernandez, then a member of the Interim Batasang Pambansa purchased ten
shares of stock of IPI from a member of Aceros group. And during a conference
held by SEC Commissioner de Guzman (from May 25-31 79) to have the
parties confer with each other, Estanislao Fernandez entered his appearance as
counsel for Acero. Puyat objected arguing that it is unconstitutional for an
assemblyman to appear as counsel (to anyone) before any administrative body
(such as the SEC). This being cleared, Fernandez inhibited himself from
appearing as counsel for Acero. He instead filed an Urgent Motion for
Intervention in this said SEC case for him to intervene not as a counsel but as a
legal owner of IPI shares and as a person who has a legal interest in the matter
in litigation. The SEC Commissioner granted the motion in effect granting
Fernandez leave to intervene. Puyat then moved to question the
Commissioners action.

ISSUE: Whether or not Fernandez, acting as a stockholder of IPI, can appear

and intervene in the SEC case without violating the constitutional provision that
an assemblyman must not appear as counsel in such courts or bodies?
HELD: No, Fernandez cannot appear before the SEC body under the guise that
he is not appearing as a counsel. Even though he is a stockholder and that he
has a legal interest in the matter in litigation he is still barred from appearing.
He bought the stocks before the litigation took place. During the conference he
presented himself as counsel but because it is clearly stated that he cannot do
so under the constitution he instead presented himself as a party of interest
which is clearly a work around and is clearly an act after the fact. A mere work
around to get himself involved in the litigation. What could not be done directly
could not likewise be done indirectly.
In Re: Rodolfo Manzano
Facts:
Judge Manzano filed a petition allowing him to accept the appointment by
Ilocos Sur Governor Rodolfo Farinas as the member of Ilocos Norte provincial
Committee on Justice created pursuant to a Presidential Order. He petitioned
that his membership in the Committee will not in any way amount to an
abandonment to his present position as Executive Judge of Branch XIX, RTC, 1st
Judicial region and as a member of judiciary.
Issue:
What is an administrative agency? Where does it draw the line insofar as
administrative functions are concerned?
Ruling:
The petition is denied. The Constitution prohibits the designation of members of
the Judiciary to any agency performing Quasi-Judicial or Administrative
functions (Sec.12, Art.VIII, 1987 Constitution).
Quasi-Judicial has a fairly clear meaning and Judges can confidently refrain
from participating in the work of any Administrative Agency which adjudicates
disputes & controversies involving the rights of parties within its jurisdiction.
Administrative functions are those which involve the regulation and control
over the conduct & affairs of individuals for their own welfare and
the promulgation of rules and regulations to better carry out the policy of the
Legislature or such as are devolved upon the administrative agency by the
organic law of its existence.
Administrative functions as used in Sec. 12 refers to the Governments
executive machinery and its performance of governmental acts. It refers to the
management actions, determinations, and orders of executive officials as they
administer the laws and try to make government effective. There is an element
of positive action, of supervision or control.
In the dissenting opinion of Justice Gutierrez:
Administrative functions are those which involve the regulation and control
over the conduct and affairs of individuals for their own welfare and the
promulgation of rules and regulations to better carry out the policy of the
legislature or such as are devolved upon the administrative agency by the
organic law of its existence we can readily see that membership in the
Provincial or City Committee on Justice would not involve any regulation or
control over the conduct and affairs of individuals. Neither will the Committee
on Justice promulgate rules and regulations nor exercise any quasi-legislative
functions. Its work is purely advisory. A member of the judiciary joining any

study group which concentrates on the administration of justice as long as the

group merely deliberates on problems involving the speedy disposition of cases
particularly those involving the poor and needy litigants-or detainees, pools the
expertise and experiences of the members, and limits itself to
recommendations which may be adopted or rejected by those who have the
power to legislate or administer the particular function involved in their
implementation.
Macariola vs Asuncion
Respondent: Hon. Elias B. Asuncion, in his capacity as Judge of Court of First
Instance (CFI) Leyte
FACTS: Respondent judge rendered a final decision in Civil Case No. 2012 for
lack of an appeal. A project of partition was submitted to him, which he later
approved. Among the parties thereto was petitioner Macariola.
One of the properties mentioned in the project of partition was Lot 1184. This
lot was adjudicated t the plaintiffs Reyes in equal shares subdividing Lot 1184
into five (5) lots denominated as Lot 1184-A to 1184-E.
The fifth lot, Lot 1184-E, was sold to a Dr. Arcadio Galapon who later sold a
portion of the lot to respondent Judge Asuncion and his wife Victoria. Spouses
Asuncion and Galapon conveyed their respective shares and interests in Lot
1184-E to Traders Manufacturing and Fishing Industries, Inc, owned and
managed by Judge Asuncion.
Macariola then filed an instant complaint in the CFI of Leyte against Judge
Asuncion charging him with "Acts Unbecoming of a Judge" invoking Art 1491,
par. 5 of the New Civil Code, pars.1 and 5 of the Code of Commerce, Sec. 3 par.
H of RA No. 3019, Section 12 Rule XVIII of the Civil Service Rules and Canon 25
of the Canons of Judicial Ethics. A certain Judge Nepomuceno however
dismissed such complaints. Hence, the case at bar.
ISSUE: Whether or not Judge Asuncion's act does not violate the abovementioned provisions.
HELD: The Court held that respondent Judge Asuncion's acts did not constitute
an "Act Unbecoming of a Judge" but he was reminded to be more discreet in his
private and business activities for next time.
Article 1491, par. 5 of the New Civil Code applies only to the sale or assignment
of the property which is the subject of litigation to the persons disqualified
therein. Respondent judge purchased the said lot after the decision rendered
was already final because no party filed for an appeal within the reglementary
period which makes the lot in question no longer the subject to litigation.
Furthermore, Judge Asuncion did not buy the lot in question directly from
plaintiffs, rather from a Dr. Arcadio Galapon.
Petition is hereby DENIED.
CENTRAL BANK OF THE PHILIPPINES as Liquidator of the FIDELITY
SAVINGS BANK, petitioner,
vs.
HONORABLE JUDGE JESUS P. MORFE, as Presiding Judge of Branch XIII
This case involves the question of whether a final judgment for the payment of
a time deposit in a savings bank which judgment was obtained after the bank
was declared insolvent, is a preferred claim against the bank. The question
arises under the following facts:

On February 18,1969 the Monetary Board found the Fidelity Savings Bank to be
insolvent. The Board directed the Superintendent of Banks to take charge of its
assets, forbade it to do business and instructed the Central Bank Legal Counsel
to take legal actions (Resolution No. 350).
On December 9, 1969 the Board involved to seek the court's assistant and
supervision in the liquidation of the ban The resolution implemented only on
January 25, 1972, when his Central Bank of the Philippines filed the
corresponding petition for assistance and supervision in the Court of First
Instance of Manila (Civil Case No. 86005 assigned to Branch XIII).
Prior to the institution of the liquidation proceeding but after the declaration of
insolvency, or, specifically, sometime in March, 1971, the spouses Job Elizes
and Marcela P. Elizes filed a complaint in the Court of First Instance of Manila
against the Fidelity Savings Bank for the recovery of the sum of P50, 584 as the
balance of their time deposits (Civil Case No. 82520 assigned to Branch I).
In the judgment rendered in that case on December 13, 1972 the Fidelity
Savings Bank was ordered to pay the Elizes spouses the sum of P50,584 plus
accumulated interest.
In another case, assigned to Branch XXX of the Court of First Instance of Manila,
the spouses Augusta A. Padilla and Adelaida Padilla secured on April 14, 1972 a
judgment against the Fidelity Savings Bank for the sums of P80,000 as the
balance of their time deposits, plus interests, P70,000 as moral and exemplary
damages and P9,600 as attorney's fees (Civil Case No. 84200 where the action
was filed on September 6, 1971).
In its orders of August 20, 1973 and February 25, 1974, the lower court (Branch
XIII having cognizance of the liquidation proceeding), upon motions of the
Elizes and Padilla spouses and over the opposition of the Central Bank, directed
the latter as liquidator, to pay their time deposits as preferred judgments,
evidenced by final judgments, within the meaning of article 2244(14)(b) of the
Civil Code, if there are enough funds in the liquidator's custody in excess of the
credits more preferred under section 30 of the Central Bank Law in relation to
articles 2244 and 2251 of the Civil Code.
From the said order, the Central Bank appealed to this Court by certiorari. It
contends that the final judgments secured by the Elizes and Padilla spouses do
not enjoy any preference because (a) they were rendered after the Fidelity
Savings Bank was declared insolvent and (b) under the charter of the Central
Bank and the General Banking Law, no final judgment can be validly obtained
against an insolvent bank.
Republic Act No. 265 provides:t.hqw
SEC. 29. Proceeding upon insolvency.Whenever upon
examination by the Superintendent or his examiners or agents
into the condition of any banking institution, it shall be
disclosed that the condition of the same is one of insolvency,
or that its continuance in business would involve probable loss
to its depositors or creditors, it shall be the duty of the
Superintendent forthwith, in writing to inform the Monetary
Board of the facts, and the Board, upon finding the statements
of the Superintendent to be true, shall forthwith forbid the
institution to do business in the Philippines and shall take
charge of its assets and proceeds according to law.

The Monetary Board shall thereupon determine within thirty

days whether the institution may be reorganized or otherwise
placed in such a condition so that it may be permitted to
resume business with safety to its creditors and shall prescribe
the conditions under which such resumption of business shall
take place. In such case the expenses and fees in the
administration of the institution shall be determined by the
Board and shall be paid to the Central Bank out of the assets
of such banking institution.

(14) Credits which, without special privilege, appear in (a) a

public instrument; or (b) in a final judgment, if they have been
the subject of litigation. These credits shall have preference
among themselves in the order of priority of the dates of the
instruments and of the judgments, respectively. (1924a)

At any time within ten days after the Monetary Board has
taken charge of the assets of any banking institution, such
institution may apply to the Court of First Instance for an order
requiring the Monetary Board to show cause why it should not
be enjoined from continuing such charge of its assets, and the
court may direct the Board to refrain from further proceedings
and to surrender charge of its assets.

(1) In the order established in article 2244;

If the Monetary Board shall determine that the banking

institution cannot resume business with safety to its creditors,
it shall, by the Office of the Solicitor General, file a petition in
the Court of First Instance reciting the proceedings which have
been taken and praying the assistance and supervision of the
court in the liquidation of the affairs of the same. The
Superintendent shall thereafter, upon order of the Monetary
Board and under the supervision of the court and with all
convenient speed, convert the assets of the banking institution
to money.
SEC. 30. Distribution of assets.In case of liquidation of a
banking institution, after payment of the costs of the
proceedings, including reasonable expenses and fees of the
Central Bank to be allowed by the court, the Central Bank shall
pay the debts of such institution, under the order of the court,
in accordance with their legal priority.
The General Banking Act, Republic Act No. 337, provides:t.hqw
SEC. 85. Any director or officer of any banking institution who
receives or permits or causes to be received in said bank any
deposit, or who pays out or permits or causes to be paid out
any funds of said bank, or who transfers or permits or causes
to be transferred any securities or property of said bank, after
said bank becomes insolvent, shall be punished by fine of not
less than one thousand nor more than ten thousand pesos and
by imprisonment for not less than two nor more than ten
years.
The Civil Code provides:t.hqw
ART. 2237. Insolvency shall be governed by special laws
insofar as they are not inconsistent with this Code. (n)
ART. 2244. With reference to other property, real and personal,
of the debtor, the following claims or credits shall be preferred
in the order named:
xxx xxx xxx

ART. 2251. Those credits which do not enjoy any preference

with respect to specific property, and those which enjoy
preference, as to the amount not paid, shall be satisfied
according to the following rules:
(2) Common credits referred to in article 2245 shall be
paid pro rata regardless of dates. (1929a)
The trial court or, to be exact, the liquidation court noted that there is no
provision in the charter of the Central Bank in the General Banking Law
(Republic Acts Nos. 265 and 337, respectively) which suspends or abates civil
actions against an insolvent bank pending in courts other than the liquidation
court. It reasoned out that, because such actions are not suspended, judgments
against insolvent banks could be considered as preferred credits under article
2244(14)(b) of the Civil Code. It further noted that, in contrast with the Central
Act, section 18 of the Insolvency Law provides that upon the issuance by the
court of an order declaring a person insolvent "all civil proceedings against the
said insolvent shall be stayed."
The liquidation court directed the Central Bank to honor the writs of execution
issued by Branches I and XXX for the enforcement of the judgments obtained
by the Elizes and Padilla spouses. It suggested that, after satisfaction of the
judgment the Central Bank, as liquidator, should include said judgments in the
list of preferred credits contained in the "Project of Distribution" "with the
notation "already paid" "
On the other hand, the Central Bank argues that after the Monetary Board has
declared that a bank is insolvent and has ordered it to cease operations, the
Board becomes the trustee of its assets "for the equal benefit of all the
creditors, including the depositors". The Central Bank cites the ruling that "the
assets of an insolvent banking institution are held in trust for the equal benefit
of all creditors, and after its insolvency, one cannot obtain an advantage or a
preference over another by an attachment, execution or otherwise" (Rohr vs.
Stanton Trust & Savings Bank, 76 Mont. 248, 245 Pac. 947).
The stand of the Central Bank is that all depositors and creditors of the
insolvent bank should file their actions with the liquidation court. In support of
that view it cites the provision that the Insolvency Law does not apply to banks
(last sentence, sec. 52 of Act No. 1956).
It also invokes the provision penalizing a director officer of a bank who
disburses, or allows disbursement, of the funds of the bank after it becomes
insolvent (Sec. 85, General Banking Act, Republic Act No. 337). It cites the
ruling that "a creditor of an insolvent state bank in the hands of a liquidator
who recovered a judgment against it is not entitled to a preference for (by) the
mere fact that he is a judgment creditor" (Thomas H. Briggs & Sons, Inc. vs.
Allen, 207 N. Carolina 10, 175 S. E. 838, Braver Liquidation of Financial
Institutions, p. 922).
It should be noted that fixed, savings, and current deposits of money in banks
and similar institutions are not true deposits. They are considered simple loans

and, as such, are not preferred credits (Art. 1980, Civil Code; In re Liquidation of
Mercantile Bank of China: Tan Tiong Tick vs. American Apothecaries Co., 65 Phil.
414; Pacific Coast Biscuit Co. vs. Chinese Grocers Association, 65 Phil. 375;
Fletcher American National Bank vs. Ang Cheng Lian, 65 Phil. 385; Pacific
Commercial Co. vs. American Apothecaries Co., 65 Phil. 429; Gopoco Grocery
vs. Pacific Coast Biscuit Co., 65 Phil. 443).
The aforequoted section 29 of the Central Bank's charter explicitly provides
that when a bank is found to be insolvent, the Monetary Board shall forbid it to
do business and shall take charge of its assets. The Board in its Resolution No.
350 dated February 18,1969 banned the Fidelity Savings Bank from doing
business. It took charge of the bank's assets. Evidently, one purpose in
prohibiting the insolvent bank from doing business is to prevent some
depositors from having an undue or fraudulent preference over other creditors
and depositors.
That purpose would be nullified if, as in this case, after the bank is declared
insolvent, suits by some depositors could be maintained and judgments would
be rendered for the payment of their deposits and then such judgments would
be considered preferred credits under article 2244 (14) (b) of the Civil Code.
We are of the opinion that such judgments cannot be considered preferred and
that article 2244(14)(b) does not apply to judgments for the payment of the
deposits in an insolvent savings bank which were obtained after the declaration
of insolvency.
A contrary rule or practice would be productive of injustice, mischief and
confusion. To recognize such judgments as entitled to priority would mean that
depositors in insolvent banks, after learning that the bank is insolvent as shown
by the fact that it can no longer pay withdrawals or that it has closed its doors
or has been enjoined by the Monetary Board from doing business, would rush to
the courts to secure judgments for the payment of their deposits.
In such an eventuality, the courts would be swamped with suits of that
character. Some of the judgments would be default judgments. Depositors
armed with such judgments would pester the liquidation court with claims for
preference on the basis of article 2244(14)(b). Less alert depositors would be
prejudiced. That inequitable situation could not have been contemplated by the
framers of section 29.
The Rohr case (supra) supplies some illumination on the disposition of the
instant case. It appears in that case that the Stanton Trust & Savings Bank of
Great Falls closed its doors to business on July 9, 1923. On November 7,1924
the bank (then already under liquidation) issued to William Rohr a certificate
stating that he was entitled to claim from the bank $1,191.72 and that he was
entitled to dividends thereon. Later, Rohr sued the bank for the payment of his
claim. The bank demurred to the complaint. The trial court sustained the
demurrer. Rohr appealed. In affirming the order sustaining the demurrer, the
Supreme Court of Montana said:t.hqw
The general principle of equity that the assets of an insolvent
are to he distributed ratably among general creditors applies
with full force to the distribution of the assets of a bank. A
general depositor of a bank is merely a general creditor, and,
as such, is not entitled to any preference or priority over other
general creditors.
The assets of a bank in process of liquidation are held in trust
for the equal benefit of all creditors, and one cannot be

permitted to obtain an advantage or preference over another

by an attachment, execution or otherwise. A disputed claim of
a creditor may be adjudicated, but those whose claims are
recognized and admitted may not successfully maintain action
thereon. So to permit would defeat the very purpose of the
liquidation of a bank whether being voluntarily accomplished
or through the intervention of a receiver.
xxx xxx xxx
The available assets of such a bank are held in trust, and so
conserved that each depositor or other creditor shall receive
payment or dividend according to the amount of his debt, and
that none of equal class shall receive any advantage or
preference over another.
And with respect to a national bank under voluntary liquidation, the court noted
in the Rohr case that the assets of such a bank "become a trust fund, to be
administered for the benefit of all creditors pro rata and, while the bank retains
its corporate existence, and may be sued, the effect of a judgment obtained
against it by a creditor is only to fix the amount of debt. He can acquire no lien
which will give him any preference or advantage over other general creditors.
(245 Pac. 249). *
Considering that the deposits in question, in their inception, were not preferred
credits, it does not seem logical and just that they should be raised to the
category of preferred credits simply because the depositors, taking advantage
of the long interval between the declaration of insolvency and the filing of the
petition for judicial assistance and supervision, were able to secure judgments
for the payment of their time deposits.
The judicial declaration that the said deposits were payable to the depositors,
as indisputably they were due, could not have given the Elizes and Padilla
spouses a priority over the other depositors whose deposits were likewise
indisputably due and owing from the insolvent bank but who did not want to
incur litigation expenses in securing a judgment for the payment of the
deposits.
The circumstance that the Fidelity Savings Bank, having stopped operations
since February 19, 1969, was forbidden to do business (and that ban would
include the payment of time deposits) implies that suits for the payment of
such deposits were prohibited. What was directly prohibited should not be
encompassed indirectly. (See Maurello vs. Broadway Bank & Trust Co. of
Paterson 176 Atl. 391, 114 N.J.L. 167).
It is noteworthy that in the trial court's order of October 3, 1972, which contains
the Bank Liquidation Rules and Regulations, it indicated in step III the procedure
for processing the claims against the insolvent bank. In Step IV, the court
directed the Central Bank, as liquidator, to submit a Project of Distribution
which should include "a list of the preferred credits to be paid in full in the order
of priorities established in Articles 2241, 2242, 2243, 2246 and 2247" of the
Civil Code (note that article 2244 was not mentioned). There is no cogent
reason why the Elizes and Padilla spouses should not adhere to the procedure
outlined in the said rules and regulations.
WHEREFORE, the lower court's orders of August 20, 1973 and February 25,
1974 are reversed and set aside. No costs.
SO ORDERED.

Chiongbian v Orbos (
This suit challenges the validity of:-Sec. 13, Art. 29 of RA No. 6734 (the Organic
Act for the Autonomous Region in MuslimMindanao)-Executive Order No. 429
(Providing for the Reorganization of Administrative Regions inMindanao
Facts:
1.Pursuant to Sec. 18, Art X of the Constitution, Congress passed RA No. 6734
2. RA No. 6734 called for a plebiscite to be held in the following provinces:
Basilan,Cotabato, Davao del Sur, Lanao del Norte, Lanao del Sur, Maguindanao,
Palawan, SouthCotabato, Sultan Kudarat, Sulu, Tawi-Tawi, Zamboanga del Norte,
and Zamboanga delSur; and the following cities: Cotabato, Dapitan, Dipolog,
General Santos, Iligan,Marawi, Pagadian, Puerto Prinsesa, and
Zamboanga3.Four provinces voted in favor of creating an autonomous region:
Lanao del Sur,Maguindanao, Sulu, Tawi-tawi4.The cities and provinces not
voting in favor of the Autonomous Region were under ArtXIX, Sec. 13 of the RA
6734:
That only provinces and cities voting favorably in plebiscites shall be included
in the ARMM. The provinces and cities which in the plebiscite do not vote for
inclusion in the Autonomous Region shall remain in the existing administrative
regions. Provided,however, that the President may, by administrative
determination, merge the existingregions
With this provision, President Aquino issued Executive Order No. 429, Providing
fortheReorganization of the Administrative Regions in Mindanao.

determination,merge existing regions. James Chiongbian, a Sultan Kudarat

congressman, filed a certiorari prohibition to protest the E.O., claiming that
President Aquino had no power to reorganize administrative regions because
said provision in R. A. 67341) also states that provinces, cities which in the
plebiscite do not vote for inclusion in the Autonomous Region shall remainthe
existing administrative regions 2) the Constitution does not expressly provide
the President the power to mergeadministrative regions; in fact Art. 10, Sec. 10
of the Constitution (see II of your outline) prohibits this and 3) even
grantingthat the President is allowed to merge administrative regions, there is
law setting standard on how it is to be done.
Held: Chiongbian is wrong. Reasons:1)The sentence shall remain in the
existing administrative regions, is further qualify by the phrase,
Providedhowever that the President may, by administration determination
merge the existing regions.2)Past legislation, particularly R. A. 5345 issued in
1968, authorized the President the help of a Commission onReorganization, to
reorganize the different example departments including administrative regions.
This showsthat traditional power to reorganize administrative regions has
always been lodged in the President
The standard is found in R. A. 5345 which states to promote simplicity,
economic efficiency in thegovernment to enable it to pursue programs
consistent with no goals for accelerated social and economicdevelopment and
to improve service transaction of the public business.

Petitioners, members of the Congress, wrote to Corazon Aquino, contending

that theres:
No law authorizing the President to pick certain provinces and cities to
berestructured to new administrative regions
Some of the provinces and cities in the regions did not even take part in
theplebiscite
The transfer of provinces is an alteration of existing governmental units
orreorganization. The authority to merge doesnt include the authority
toreorganize.7.The inauguration of the New Administrative Region IX went
ahead.8.Congress brought the suit for prohibition and certiorari; petitioner
Jaldon brough a suitas resident of Zamboanga City, taxpayer and citizen of the
Republic.
Petitioners:
1.Section 29 of RA 6734 is unconstitutional because it unduly delegates
legislative powerto the President by authorizing him to merge existing region
and provides no standardfor the exercise of the power delegated; and,
2.The power granted is not expressed in the title of the law.
Facts: In 1990, President Aquino issued E. O. No. 439 wherein she picked
certain provinces and cities, some of which did not participate in the inclusion
to the ARMM, to the reorganized to new regions (e.g. Misamis Occidental,
whichdid not participate in the ARMM plebiscite, was transferred from Region X
to Region XI). Aquino issued said E. O.pursuant ant R. A. 6734, which says:
That only the provinces and cities voting favorably in suitable plebiscites shall
beincluded in the ARMM. The provinces and cities which plebiscite no vote for
inclusion in the Autonomous Region shallremain in the existing administrative
regions. Provided however, that the President may, by administrative