G.R. No.

L-19180

October 31, 1963

NATIONAL DEVELOPMENT COMPANY, ET AL., petitioners-appellees, vs. THE COLLECTOR OF CUSTOMS OF MANILA, respondent-appellant. Ross, Selph and Carrascoso for petitioners-appellees. Office of the Solicitor General for respondent-appellant. BAUTISTA ANGELO, J.: The National Development Company which is engaged in the shipping business under the name of "Philippine National Lines" is the owner of steamship "S.S. Doa Nati" whose local agent in Manila is A. V. Rocha. On August 4, 1960, the Collector of Customs sent a notice to C.F. Sharp & Company as alleged operator of the vessel informing it that said vessel was apprehended and found to have committed a violation of the customs laws and regulations in that it carried an unmanifested cargo consisting of one RCA Victor TV set 21" in violation of Section 2521 of the Tariff and Customs Code. Inserted in said notice is a note of the following tenor: "The above article was being carried away by Dr. Basilio de Leon y Mendez, official doctor of M/S "Doa Nati" who readily admitted ownership of the same." C.F. Sharp & Company was given 48 hours to show cause why no administrative fine should be imposed upon it for said violation. C.F. Sharp & Company, not being the agent or operator of the vessel, referred the notice to A. V. Rocha, the agent and operator thereof, who on August 8, 1960, answered the notice stating, among other things, that the television set referred to therein was not a cargo of the vessel and, therefore, was not required by law to be manifested. Rocha stated further: "If this explanation is not sufficient, we request that this case be set for investigation and hearing in order to enable the vessel to be informed of the evidence against it to sustain the charge and to present evidence in its defense." The Collector of Customs replied to Rocha on August 9, 1960 stating that the television set in question was a cargo on board the vessel and that he does not find his explanation satisfactory enough to exempt the vessel from liability for violating Section 2521 of the Tariff and Customs Code. In said letter, the collector imposed a fine of P5,000.00 on the vessel and ordered payment thereof within 48 hours with a threat that he will deny clearance to said vessel and will issue a warrant of seizure and detention against it if the fine is not paid. And considering that the Collector of Customs has exceeded his jurisdiction or committed a grave abuse of discretion in imposing the fine of P5,000.00 on the vessel without the benefit of an investigation or hearing as requested by A. V. Rocha, the National Development Company, as owner of the vessel, as well as A. V. Rocha as agent and operator thereof, filed the instant special civil action of certiorari with preliminary injunction before the Court of First Instance of Manila against the official abovementioned. The court, finding the petition for injunction sufficient in form and substance, issued ex parte the writ prayed for upon the filing of a bond in the amount of P5,00.00. Respondent set up the following special defenses: (1) the court a quo has no jurisdiction to act on matters arising from violations of the Customs Law, but the Court of Tax Appeals; (2) assuming that it has, petitioners have not exhausted all available administrative remedies, one of

which is to appeal to the Commissioner of Customs; (3) the requirements of administrative due process have already been complied with in that the written notice given by respondent to petitioner Rocha clearly specified the nature of the violation complained of and that the defense set up by Rocha constitute merely a legal issue which does not require further investigation; and (4) the investigation conducted by the customs authorities showed that the television set in question was unloaded by the ship's doctor without going thru the custom house as required by law and was not declared either in the ship's manifest or in the crew declaration list. On the basis of the stipulation of facts submitted by the parties, the court a quo rendered decision setting aside the ruling of respondent which imposes a fine of P5,000.00 on the vessel Doa Nati payable within 48 hours from receipt thereof. The court stated that said ruling appears to be unjust and arbitrary because the party affected has not been accorded the investigation it requested from the Collector of Customs. Respondent interposed the present appeal. When the customs authorities found that the vessel Doa Nati carried on board an unmanifested cargo consisting of one RCA Victor TV set 21" in violation of Section 2521 of the Tariff and Customs Code, respondent sent a written notice to C. F. Sharp & Company, believing it to be the operator or agent of the vessel, and when the latter referred the notice to A. V. Rocha, the real operator of the vessel, for such step as he may deem necessary to be taken the latter answered the letter stating that the television set was not cargo and so was not required by law to be manifested, and he added to his answer the following: "If this explanation is not sufficient, we request that this case be set for investigation and hearing in order to enable the vessel to be informed of the evidence against it to sustain the charge and to present evidence in its defense. "Respondent, however, replied to this letter saying that said television was a cargo within the meaning of the law and so he does not find his explanation satisfactory and then and there imposed on the vessel a fine of P5,00.00. Respondent even went further. He ordered that said fine be paid within 48 hours from receipt with a threat that the vessel would be denied clearance and a warrant of seizure would be issued if the fine will not be paid. Considering this to be a grave abuse of discretion, petitioners commenced the present action for certiorari before the court a quo. We find this action proper for it really appears that petitioner Rocha was not given an opportunity to prove that the television set complained of is not a cargo that needs to be manifested as required by Section 2521 of the Tariff and Customs Code. Under said section, in order that an imported article or merchandise may be considered a cargo that should be manifested it is first necessary that it be so established for the reason that there are other effects that a vessel may carry that are excluded from the requirement of the law, among which are the personal effects of the members of the crew. The fact that the set in question was claimed by the customs authorities not to be within the exception does not automatically make the vessel liable. It is still necessary that the vessel, its owner or operator, be given a chance to show otherwise. This is precisely what petitioner Rocha has requested in his letter. Not only was he denied this chance, but respondent collector immediately imposed upon the vessel the huge fine of P5,000.00. This is a denial of the elementary rule of due process.

True it is that the proceedings before the Collector of Customs insofar as the determination of any act or irregularity that may involve a violation of any customs law or regulation is concerned, or of any act arising under the Tariff and Customs Code, are not judicial in character, but merely administrative, where the rules of procedure are generally disregarded, but even in the administrative proceedings due process should be observed because that is a right enshrined in our Constitution. The right to due process is not merely statutory. It is a constitutional right. Indeed, our Constitution provides that "No person shall be deprived of life, liberty, or property without due process of law", which clause epitomize the principle of justice which hears before it condemns, which proceeds upon inquiry and renders judgment only after trial. That this principle applies with equal force to administrative proceedings was well elaborated upon by this Court in the Ang Tibay case as follows: ... The fact, however, that the Court of Industrial Relations may be said to be free from the rigidity of certain procedural requirements does not mean that it can, in justiciable case coming before it, entirely ignore or disregard the fundamental and essential requirements of due process in trials and investigations of an administrative character. ... There are cardinal primary rights which must be respected even in proceedings of this character. The first of these rights is the right to a hearing, which includes the right of the party interested or affected to present his own case and submit evidence in support thereof. Not only must the party be given an opportunity to present his case and to adduce evidence tending to establish the rights which he asserts but the tribunal must consider the evidence presented. While the duty to deliberate does not impose the obligation to decide right, it does imply a necessity which cannot be disregarded, namely, that of having something to support its decision. No only must there be some evidence to support a finding or conclusion, but the evidence must be substantial. The decision must be rendered on the evidence presented at the hearing, or at least contained in the record and disclosed to the parties affected. The Court of Industrial Relations or any of its judges, therefore, must act on its or his own independent consideration of the law and facts of the controversy, and not simply accept the views of a subordinate in arriving at a decision. The Court of Industrial Relations should, in all controversial questions, render its decision in such a manner that the parties to the proceeding can know the various issues involved, and the reason for the decision rendered. The performance of this duty is inseparable from the authority conferred upon it. (Ang Tibay, et al. v. The Court of Industrial Relations, et al., 40 O.G., No. 11, Supp. p. 29). There is, therefore, no point in the contention that the court a quo has no jurisdiction over the present case because what is here involved is not whether the imposition of the fine by the Collector of Customs on the operator of the ship is correct or not but whether he acted properly in imposing said fine without first giving the operator an opportunity to be heard. Here we said that he acted improvidently and so the action taken against him is in accordance with Rule 67 of our Rules of Court. Another point raised is that petitioners have brought this action prematurely for they have not yet exhausted all the

administrative remedies available to them, one of which is to appeal the ruling to the Commissioner of Customs. This may be true, but such step we do not consider a plain, speedy or adequate remedy in the ordinary course of law as would prevent petitioners from taking the present action, for it is undisputed that respondent collector has acted in utter disregard of the principle of due process. WHEREFORE, the decision appealed from is affirmed. No costs. G.R. No. L-21685 April 30, 1966

CLETO ASPREC, petitioner-appellant, vs. VICTORIANO ITCHON, JOSE SUGUITAN, FELIPE P. CRUZ, THE EXECUTIVE SECRETARY, NICANOR G. 1 JORGE, ANTONIO NOBLEJAS, and JACINTO HERNANDEZ, respondents-appellees. Tabora and Concon for petitioner-appellant. Office of the Solicitor General Arturo A. Alafriz, Assistant Solicitor General A. G. Ibarra and Solicitor C. P. Padua for respondents-appellees. SANCHEZ, J.: The case on hand had its incipiency in an administrative 2 complaint for unprofessional conduct lodged with the 3 Board of Examiners for Surveyors by respondent Jacinto Hernandez against petitioner Cleto Asprec. There, Hernandez charged that petitioner undertook to survey Hernandez' lot in Port Junction, Ragay, Camarines Sur; deliver to him a plan approved by the Director of Lands within three months after completion of the survey, and procure the issuance of a certificate of title to the lot thus surveyed within six months after the plan's approval; and that he (Hernandez) paid the consideration agreed upon but that petitioner did not deliver the agreed plan, the lapse of four years notwithstanding. Petitioner Asprec averred compliance by allegedly executing and delivering plan Psu-148774 (Ap-2419) duly approved. But Hernandez' reply asserted that Psu-148774 is the plan of a survey made by Asprec for one Damian Alhambra; that plan Ap-2419 is merely a certified copy of sheet 2 of said plan Psu-148774; and that petitioner's contractual obligation was to deliver to him the plan of an original survey not a mere copy. The Board found for Hernandez and declared; that no actual survey of Hernandez' land was made; but that money was paid on his belief that Asprec really surveyed the land for him; that Asprec was guilty of deceit and thus violated the Code of Ethics for surveyors. The Board's unanimous decision of October 27, 1959 revoked, and required surrender of, Asprec's certificate of registration as a private land surveyor. On December 1, 1959, the Assistant Executive Secretary, by authority of the President of the Philippines, approved the Board's decision. On February 12, 1960, the Board's chairman demanded surrender of said certificate in five days. Petitioner's motion to reconsider of March 16, 1960 was denied by the Office of the President on October 31, 1960. Meanwhile, on March 22, 1960, respondent Jorge directed all offices under the Bureau of Lands to return to petitioner Asprec unacted all surveys executed or corrected by the latter on or after October 27, 1959. Petitioner, charging grave abuse of discretion, came to the Court of First Instance of Camarines Sur on certiorari to annul the orders revoking his surveyor's certificate of registration; mandamus to compel the Board to conduct a formal hearing of the complaint against him; and prohibition, to stop execution of the orders to surrender

said certificate. The preliminary injunction prayed for was rejected below. Upon a stipulations of facts, the Camarines Sur court rendered judgment on August 14, 1962, dismissing the petition, with costs. We are now asked to review said decision. We will now discuss seriatim the questions raised. 1. Petitioner's trenchant claim is that he was denied his 4 day in court. Resolution of this problem necessitates a considerate examination of the following that transpired before the Board: (a) Hearing of March 31, 1958: Petitioner raised the legal point that the complaint was not under oath. The Board directed Hernandez to submit a verified complaint. Hearing was postponed to May 12, 1958. (b) Hearing of May 12, 1958: Upon the averment that the verified complaint sets forth "new facts", petitioner asked for a 10-day period to answer. On June 6, instead of an answer, petitioner's counsel filed a motion to dismiss. (c) Hearing of August 18, 1958. Petitioner prayed that hearing be held in abeyance until the board shall have resolved his motion to dismiss. The hearing was reset for March 11, 1959. (d) Hearing of March 11, 1959: This did not pull through although both parties and their respective attorneys were present, because Asprec's counsel was not feeling well. They all agreed to transfer the hearing to May 11, 1959. (e) Hearing of May 11, 1959: Hernandez and counsel appeared. But petitioner and counsel were absent. The Board was not apprised by petitioner of the cause of his or his counsel's failure to appear. At this juncture, counsel for Hernandez manifested to the Board that "since all evidence available against the respondent has already been submitted he would now rest his case." He then filed with the Board a motion for 5 judgment on the pleadings. If the foregoing have any meaning at all, they funnel down to one concrete fact: petitioner has had more than ample opportunity to defend himself before the Board. As he and counsel did not appear at the last and stipulated date of bearing, he cannot look to the law or to a judicial tribunal to whipsaw the Board into giving him a new one. He cannot raise his voice in protest against the act of the Board in proceeding in his and his counsel's absence. And this because without cause or reason, without any excuse at all, counsel and client have chosen to shy away from the trial. Presence of a party at a trial, petitioner concedes, is not always of the essence of due process. Really, all that the law requires to satisfy adherence to this constitutional precept is that the parties be given notice of the trial, an opportunity to be heard. Petitioner had notice of the trial of May 11th. More than this, that date of trial (May 11) had been previously agreed upon by the parties and their counsel. Petitioner cannot now charge that he received less-than-a-fair-treatment. He has forfeited his 6 right to be heard in his defense. On top of all, petitioner did not as much as bother to inquire as to what happened on May 11. He bestirred

himself only on April 16 the following year. Surely enough, this patent in attention better termed gross negligence will not carry the day for him. Indeed, no reason exists why the other party should be hard put to realize that he will have to undergo further expense and trouble. After all, due process is merely "the embodiment of the sporting 7 idea of fair play." 2. But petitioner insists that the proceeding before the Board are quasi-criminal in nature. From this he proceeds to draw the conclusion that no valid trial could proceed even if he absented himself therefrom. We do not see eye to eye with this view. It is best answered by a reference to the opinion of the court below, thus: The rule applies even to quasi-criminal or criminal proceedings. So, where the respondent in a petition for contempt failed to appear on the date set for the hearing, of which he was previously notified, it was held that he was not deprived of his day in court when the judge ordered him arrested unless he pay the support he was adjudged to give, he having been given an opportunity to be heard. Embate vs. Penolio, G.R. 8 No. L-4942. Similarly, the defendant's failure to appear with the counsel of his choice at the trial, notwithstanding repeated postponements and the warning that failure to appear would be deemed a waiver of the right to present evidence in his defense and the case will be submitted for decision on the evidence submitted by the prosecution, was a sufficient justification for the court to proceed and render judgment upon the evidence before it. People vs. Angco, 54 Off. Gaz. 5703. 3. Appellant decries the fact that the Board's decision was rendered upon a motion for judgment on the pleadings presented on the date of trial, May 11, 1959. He claims that there was no basis for such decision. A rule so long respected, because it is buttressed upon reason and authority, is that technical rules of court practice, procedure and evidence are not to be applied with rigidity in administrative proceedings. We should have in mind the nature of administrative bodies, the character of the duties they are required to perform, the purposes for which they are organized and the persons who compose them. Here, we are concerned with members of a board of surveyors technical men but not necessarily trained law men. In this posture, it is quite reasonable to assume that their proceedings may not be conducted with that degree of exactness or with such scrupulous observance of the complex technical rules expected in a legal battle before a court of justice. Their acts should not be measured by the same yardstick exacted of a judge of a court of law. So much leeway is 9 given an investigating administrative body. With the foregoing legal tenet as guide, let us now examine the facts of this case. There was indeed a motion for judgment on the pleadings. But not without reason. Petitioner admits that he executed the plan, sent it to complainant. But this plan (Ap-2419) is not the plan of an original survey. Because it was merely copied from 10 another plan. Petitioner received compensation on the basis of a plan drawn from a survey, not from a copy. Besides, the plans the original and copied plans were before the Board. So it is, that when counsel for Hernandez manifested at the hearing of May 11, 1959 that all the evidence against petitioner was submitted to the Board and that for that reason he was resting his case, he evidently had in mind the admissions in the pleadings and

the plans and decision and report here noted. And, the motion for judgment on the pleadings was a mere followup of the manifestation just adverted to. As the trial court well observed, counsel for respondent Hernandez did not present a motion for judgment on the pleadings in the 11 strict sense of the word, but "a motion which for lack of another expression, he called a motion for judgment on the pleadings." Lack of observance of this technicality which does not quarrel with a fair concept of justice should 12 be overlooked. There was evidence before the Board and the Board had acted thereon. The Board's decision was propped up by facts.1wph1.t 4. A review of the record fails to elicit any representation on the part of petitioner that if the Board's decision and the decision of the Court below be reversed, a different result may be obtained. He does not advance any fact or circumstance which would constitute a substantial defense. He does not even offer a new matter which would tilt the scales of justice in his favor. The net result is that if error of procedure there was, as he claims, such error is reduced to the level of non-prejudicial. It is because of all of these that we now say that a reversal of the judgment below or a new hearing before the Board would be but an empty ceremony. Courts do not demand or, for that matter, suggest the performance of the unnecessary. If only for this alone, there is no cause or reason why the machinery administrative or judicial 13 should be allowed to grind anew. 5. Petitioner would want to make a point out of Surveyor's Administrative Order No. 1, dated November 26, 1934 (which implemented Act 3626 as amended by Act No. 3889), section 19 (g) of which provides that "Any surveyor who has been suspended three (3) times shall no longer be authorized to practice surveying in the Philippine Islands". Petitioner now asserts that the Board's decision revoking his license is an illegality. This argument overlooks the express statutory provision contained in Section 10 of Act 3626 as amended by Act 3889 aforesaid, as follows: The Board of Examiners may suspend or revoke the license or certificate as practising surveyor granted to any person in case the same has been convicted by any court of a crime involving moral turpitude, if he has been guilty of immoral and dishonest conduct, if he is mentally incapacitated, or for unprofessional conduct. The decision of the Board shall be rendered after an investigation in which the accused shall be heard, and said accused may appeal to the Department head, whose decision shall be final administratively. This law does not state that the surveyor's license may be revoked, only after the said surveyor has been suspended three times. The plain import of the law is that ample discretion is given the Board to suspend or revoke the license. The Board has elected to revoke. It acted within the law. For, a familiar rule is that in a clash between statute and administrative order issued in pursuance thereof, the former prevails. In the end, we say that the proceedings before the Board were not infused with such unfairness or tainted with so grave an abuse of authority as to call for the exercise by this Court of its corrective powers. Upon the view we take of this case, the decision is hereby affirmed. Costs against petitioner. G.R. No. 111953 December 12, 1997

HON. RENATO C. CORONA, in his capacity as Assistant Secretary for Legal Affairs, HON. JESUS B. GARCIA, in his capacity as Acting Secretary, Department of Transportation and Communications, and ROGELIO A. DAYAN, in his capacity as General Manager of Philippine Ports Authority, petitioners, vs. UNITED HARBOR PILOTS ASSOCIATION OF THE PHILIPPINES and MANILA PILOTS ASSOCIATION, respondents.

ROMERO, J.: In issuing Administrative Order No. 04-92 (PPA-AO No. 04-92), limiting the term of appointment of harbor pilots to one year subject to yearly renewal or cancellation, did the Philippine Ports Authority (PPA) violate respondents' right to exercise their profession and their right to due process of law? The PPA was created on July 11, 1974, by virtue of Presidential Decree No. 505. On December 23, 1975, Presidential Decree No. 857 was issued revising the PPA's charter. Pursuant to its power of control, regulation, 1 and supervision of pilots and the pilotage profession, the 2 PPA promulgated PPA-AO-03-85 on March 21, 1985, which embodied the "Rules and Regulations Governing Pilotage Services, the Conduct of Pilots and Pilotage Fees in Philippine Ports." These rules mandate, inter alia, that 3 aspiring pilots must be holders of pilot licenses and must train as probationary pilots in outports for three months and in the Port of Manila for four months. It is only after 4 they have achieved satisfactory performance that they are given permanent and regular appointments by the 5 PPA itself to exercise harbor pilotage until they reach the age of 70, unless sooner removed by reason of mental or 6 physical unfitness by the PPA General Manager. Harbor pilots in every harbor district are further required to organize themselves into pilot associations which would make available such equipment as may be required by the PPA for effective pilotage services. In view of this mandate, pilot associations invested in floating, communications, and office equipment. In fact, every new pilot appointed by the PPA automatically becomes a member of a pilot association and is required to pay a proportionate equivalent equity or capital before being allowed to assume his duties, as reimbursement to the association concerned of the amount it paid to his predecessor. Subsequently, then PPA General Manager Rogelio A. 7 Dayan issued PPA-AO No. 04-92 on July 15, 1992, whose avowed policy was to "instill effective discipline and thereby afford better protection to the port users through the improvement of pilotage services." This was implemented by providing therein that "all existing regular appointments which have been previously issued either by the Bureau of Customs or the PPA shall remain valid up to 31 December 1992 only" and that "all appointments to harbor pilot positions in all pilotage districts shall, henceforth, be only for a term of one (1) year from date of effectivity subject to yearly renewal or cancellation by the Authority after conduct of a rigid evaluation of performance." On August 12, 1992, respondents United Harbor Pilots Association and the Manila Pilots Association, through

Capt. Alberto C. Compas, questioned PPA-AO No. 04-92 before the Department of Transportation and Communication, but they were informed by then DOTC Secretary Jesus B. Garcia that "the matter of reviewing, recalling or annulling PPA's administrative issuances lies exclusively with its Board of Directors as its governing body." Meanwhile, on August 31, 1992, the PPA issued 8 Memorandum Order No. 08-92 which laid down the criteria or factors to be considered in the reappointment of 9 harbor pilot, viz.: (1) Qualifying Factors: safety record and physical/mental medical exam report and (2) Criteria 10 for Evaluation: promptness in servicing vessels, compliance with PPA Pilotage Guidelines, number of years as a harbor pilot, average GRT of vessels serviced as pilot, awards/commendations as harbor pilot, and age. Respondents reiterated their request for the suspension of the implementation of PPA-AO No. 04-92, but Secretary Garcia insisted on his position that the matter was within the jurisdiction of the Board of Directors of the PPA. Compas appealed this ruling to the Office of the President (OP), reiterating his arguments before the DOTC. On December 23, 1992, the OP issued an order directing the PPA to hold in abeyance the implementation of PPAAO No. 04-92. In its answer, the PPA countered that said administrative order was issued in the exercise of its administrative control and supervision over harbor pilots under Section 6-a (viii), Article IV of P.D. No. 857, as amended, and it, along with its implementing guidelines, was intended to restore order in the ports and to improve the quality of port services. On March 17, 1993, the OP, through then Assistant Executive Secretary for Legal Affairs Renato C. Corona, dismissed the appeal/petition and lifted the restraining 11 order issued earlier. He concluded that PPA-AO No. 0492 applied to all harbor pilots and, for all intents and purposes, was not the act of Dayan, but of the PPA, which was merely implementing Section 6 of P.D. No. 857, mandating it "to control, regulate and supervise pilotage and conduct of pilots in any port district." On the alleged unconstitutionality and illegality of PPA-AO No. 04-92 and its implementing memoranda and circulars, Secretary Corona opined that: The exercise of one's profession falls within the constitutional guarantee against wrongful deprivation of, or interference with, property rights without due process . In the limited context of this case. PPA-AO 04-92 does not constitute a wrongful interference with, let alone a wrongful deprivation of, the property rights of those affected thereby. As may be noted, the issuance aims no more than to improve pilotage services by limiting the appointment to harbor pilot positions to one year, subject to renewal or cancellation after a rigid evaluation of the appointee's performance. PPA-AO 04-92 does not forbid, but merely regulates, the exercise by harbor pilots of their profession in PPA's jurisdictional area. (Emphasis supplied) Finally, as regards the alleged "absence of ample prior consultation" before the issuance of the administrative order, Secretary Corona cited Section 26 of P.D. No. 857, which merely requires the PPA to consult with "relevant Government agencies." Since the PPA Board of Directors

is composed of the Secretaries of the DOTC, the Department of Public Works and Highways, the Department of Finance, and the Department of Environment and Natural Resources, as well as the Director-General of the National Economic Development Agency, the Administrator of the Maritime Industry Authority (MARINA), and the private sector representative who, due to his knowledge and expertise, was appointed by the President to the Board, he concluded that the law has been sufficiently complied with by the PPA in issuing the assailed administrative order. Consequently, respondents filed a petition for certiorari, prohibition and injunction with prayer for the issuance of a temporary restraining order and damages, before Branch 6 of the Regional Trial Court of Manila, which was docketed as Civil Case No. 93-65673. On September 6, 12 1993, the trial court rendered the following judgment: WHEREFORE, for all the foregoing, this Court hereby rules that: 1. Respondents (herein petitioners) have acted excess jurisdiction and with grave abuse of discretion and in a capricious, whimsical and arbitrary manner in promulgating PPA Administrative Order 04-92 including all its implementing Memoranda, Circulars and Orders; 2. PPA Administrative Order 04-92 and its implementing Circulars and Orders are declared null and void; 3. The respondents are permanently enjoined from implementing PPA Administrative Order 04-92 and its implementing Memoranda, Circulars and Orders. No costs. SO ORDERED. The court a quo pointed out that the Bureau of Customs, the precursor of the PPA, recognized pilotage as a profession and, therefore, a property right under Callanta 13 v. Carnation Philippines, Inc. Thus, abbreviating the term within which that privilege may be exercised would be an interference with the property rights of the harbor pilots. Consequently, any "withdrawal or alteration" of such property right must be strictly made in accordance with the constitutional mandate of due process of law. This was apparently not followed by the PPA when it did not conduct public hearings prior to the issuance of PPAAO No. 04-92; respondents allegedly learned about it only after its publication in the newspapers. From this decision, petitioners elevated their case to this Court on certiorari. After carefully examining the records and deliberating on the arguments of the parties, the Court is convinced that PPA-AO No. 04-92 was issued in stark disregard of respondents' right against deprivation of property without due process of law. Consequently, the instant petition must be denied. Section 1 of the Bill of Rights lays down what is known as the "due process clause" of the Constitution, viz.: Sec. 1. No person shall be deprived of life, liberty, or property without due process of law, . . . In order to fall within the aegis of this provision, two conditions must concur, namely, that there is a deprivation and that such deprivation is done without proper observance of due process. When one speaks of due process of law, however, a distinction must be made between matters of procedure and matters of substance.

In essence, procedural due process "refers to the method or manner by which the law is enforced," while substantive due process "requires that the law itself, not merely the procedures by which the law would be enforced, is fair, 14 reasonable, and just." PPA-AO No. 04-92 must be examined in light of this distinction. Respondents argue that due process was not observed in the adoption of PPA-AO No. 04-92 allegedly because no hearing was conducted whereby "relevant government agencies" and the pilots themselves could ventilate their views. They are obviously referring to the procedural aspect of the enactment. Fortunately, the Court has maintained a clear position in this regard, a stance it has stressed in the recent case of Lumiqued v. Hon. Exevea, 15 where it declared that "(a)s long as a party was given the opportunity to defend his interests in due course, he cannot be said to have been denied due process of law, for this opportunity to be heard is the very essence of due process. Moreover, this constitutional mandate is deemed satisfied if a person is granted an opportunity to seek reconsideration of the action or ruling complained of." In the case at bar, respondents questioned PPA-AO No. 16 04-92 no less than four times before the matter was finally elevated to this Tribunal. Their arguments on this score, however, fail to persuade. While respondents emphasize that the Philippine Coast Guard, "which issues the licenses of pilots after administering the pilots' 17 examinations," was not consulted, the facts show that the MARINA, which took over the licensing function of the Philippine Coast Guard, was duly represented in the Board of Directors of the PPA. Thus, petitioners correctly argued that, there being no matters of naval defense involved in the issuance of the administrative order, the 18 Philippine Coast Guard need not be consulted. Neither does the fact that the pilots themselves were not consulted in any way taint the validity of the administrative order. As a general rule, notice and hearing, as the fundamental requirements of procedural due process, are essential only when an administrative body exercises its quasi-judicial function. In the performance of its executive or legislative functions, such as issuing rules and regulations, an administrative body need not comply with 19 the requirements of notice and hearing. Upon the other hand, it is also contended that the sole and exclusive right to the exercise of harbor pilotage by pilots is a settled issue. Respondents aver that said right has become vested and can only be "withdrawn or shortened" by observing the constitutional mandate of due process of law. Their argument has thus shifted from the procedural to one of substance. It is here where PPA-AO No. 04-92 fails to meet the condition set by the organic law. There is no dispute that pilotage as a profession has taken on the nature of a property right. Even petitioner Corona recognized this when he stated in his March 17, 1993, decision that "(t)he exercise of one's profession falls within the constitutional guarantee against wrongful deprivation of, or interference with, property rights without 20 due process." He merely expressed the opinion the "(i)n the limited context of this case, PPA-AO 04-92 does not constitute a wrongful interference with, let alone a wrongful deprivation of, the property rights of those affected thereby, and that "PPA-AO 04-95 does not forbid,

but merely regulates, the exercise by harbor pilots of their profession." As will be presently demonstrated, such supposition is gravely erroneous and tends to perpetuate an administrative order which is not only unreasonable but also superfluous. Pilotage, just like other professions, may be practiced only by duly licensed individuals. Licensure is "the granting of license especially to practice a profession." It is also "the system of granting licenses (as for professional practice) 21 in accordance with establishment standards." A license is a right or permission granted by some competent authority to carry on a business or do an act which, 22 without such license, would be illegal. Before harbor pilots can earn a license to practice their profession, they literally have to pass through the proverbial eye of a needle by taking, not one but five examinations, each followed by actual training and practice. Thus, the court a quo observed: Petitioners (herein respondents) contend, and the respondents (herein petitioners) do not deny, the here (sic) in this jurisdiction, before a person can be a harbor pilot, he must pass five (5) government professional examinations, namely, (1) For Third Mate and after which he must work, train and practice on board a vessel for at least a year; (2) For Second Mate and after which he must work, train and practice for at least a year; (3) For Chief Mate and after which he must work, train and practice for at least a year; (4) For a Master Mariner and after which he must work as Captain of vessel for at least two (2) years to qualify for an examination to be a pilot; and finally, of course, that given for pilots. Their license is granted in the form of an appointment which allows them to engage in pilotage until they retire at the age 70 years. This is a vested right. Under the terms of PPA-AO No. 04-92, "(a)ll existing regular appointments which have been previously issued by the Bureau of Customs or the PPA shall remain valid up to 31 December 1992 only," and "(a)ll appointments to harbor pilot positions in all pilotage districts shall, henceforth, be only for a term of one (1) year from date of effectivity subject to renewal or cancellation by the Authority after conduct of a rigid evaluation of performance." It is readily apparent that PPA-AO No. 04-92 unduly restricts the right of harbor pilots to enjoy their profession before their compulsory retirement. In the past, they enjoyed a measure of security knowing that after passing five examinations and undergoing years of on-the-job training, they would have a license which they could use until their retirement, unless sooner revoked by the PPA for mental or physical unfitness. Under the new issuance, they have to contend with an annual cancellation of their license which can be temporary or permanent depending on the outcome of their performance evaluation. Veteran pilots and neophytes alike are suddenly confronted with one-year terms which ipso facto expire at the end of that period. Renewal of their license is now dependent on a "rigid evaluation of performance" which is conducted only after the license has already been cancelled. Hence, the use of the term "renewal." It is this pre-evaluation cancellation which primarily makes PPA-AO No. 04-92 unreasonable and constitutionally infirm. In a real sense, it is a deprivation of property without due process of law.

The Court notes that PPA-AO No. 04-92 and PPA-MO No. 08-92 are already covered by PPA-AO No. 03-85, which is still operational. Respondents are correct in pointing out 23 that PPA-AO No. 04-92 is a "surplusage" and, therefore, an unnecessary enactment. PPA-AO 03-85 is a comprehensive order setting forth the "Rules and Regulations Governing Pilotage Services, the Conduct of Pilots and Pilotage Fees in Philippine Ports." It provides, inter alia, for the qualification, appointment, performance evaluation, disciplining and removal of harbor pilots matters which are duplicated in PPA-AO No. 04-92 and its implementing memorandum order. Since it adds nothing new or substantial, PPA-AO No. 04-92 must be struck down. Finally, respondents' insinuation that then PPA General Manager Dayan was responsible for the issuance of the questioned administrative order may have some factual basis; after all, power and authority were vested in his office to propose rules and regulations. The trial court's finding of animosity between him and private respondents might likewise have a grain of truth. Yet the number of cases filed in court between private respondents and Dayan, including cases which have reached this Court, cannot certainly be considered the primordial reason for the issuance of PPA-AO No. 04-92. In the absence of proof to the contrary, Dayan should be presumed to have acted in accordance with law and the best of professional motives. In any event, his actions are certainly always subject to scrutiny by higher administrative authorities. WHEREFORE, the instant petition is hereby DISMISSED and the assailed decision of the court a quo dated September 6, 1993, in Civil Case No. 93-65673 is AFFIRMED. No pronouncement as to costs. SO ORDERED.

Due process of law requires notice and hearing. Hearing, on the other hand, presupposes a competent and impartial tribunal. The right to be heard and, ultimately, the right to due process of law lose meaning in the absence of an independent, competent and impartial tribunal. Statement of the Case This principium is explained by this Court as it resolves this petition for review on certiorari assailing the May 21, 1 2 1993 Decision of the Court of Appeals in CA-G.R.. SP 3 No. 29107 which affirmed the trial court's decision, as follows: WHEREFORE, the decision appealed from is AFFIRMED and the appeal is DISMISSED. The Hon. Armand Fabella is hereby ORDERED substituted as respondent-appellant in place of former Secretary Isidro Cario and henceforth this fact should be reflected in the title of this case. SO ORDERED.
4

The Antecedent Facts The facts, as found by Respondent Court, are as follows: On September 17, 1990, then DECS Secretary Cario issued a return-to-work order to all public school teachers who had participated in walk-outs and strikes on various dates during the period September 26, 1990 to October 18, 1990. The mass action had been staged to demand payment of 13th month differentials, clothing allowances and passage of a debt-cap bill in Congress, among other things. On October 18, 1990, Secretary Cario filed administrative cases against herein petitioner-appellees, who are teachers of the Mandaluyong High School. The charge sheets required petitioner-appellees to explain in writing why they should not be punished for having taken part in the mass action in violation of civil service laws and regulations, to wit: 1. grave misconduct; 2. gross neglect of duty; 3. gross violation of Civil Service Law and rules on reasonable office regulations; 4. refusal to perform official duty; 5. conduct prejudicial to the best interest of the service. 6. absence without leave (AWOL) At the same time, Secretary Cario ordered petitionerappellee to be placed under preventive suspension. The charges were subsequently amended by John Doe (not his real name)on November 7, 1990 to include the specific dates when petitioner-appellees allegedly took part in the strike. Administrative hearings started on December 20, 1990. Petitioner-appellees' counsel objected to the procedure adopted by the committee and demanded that he be furnished a copy of the guidelines adopted by the committee for the investigation and imposition of penalties. As he received no response from the committee, counsel walked out. Later, however, counsel, was able to obtain a copy of the guidelines. On April 10, 1991, the teachers filed a an injunctive suit (Civil Case No. 60675) with the Regional Trial Court in Quezon City, charging the committee appointed by

G.R. No. 110379 November 28, 1997 HON. ARMAND FABELLA, in his capacity as SECRETARY OF THE DEPARTMENT OF EDUCATION, CULTURE AND SPORTS; John Doe (not his real name), in his capacity as REGIONAL DIRECTOR, DECS-NCR; DR. BIENVENIDO ICASIANO, in his capacity as the SUPERINTENDENT OF THE QUEZON CITY SCHOOLS DIVISION; ALMA BELLA O. BAUTISTA, AURORA C. VALENZUELA and TERESITA V. DIMAGMALIW, petitioners, vs. THE COURT OF APPEALS, ROSARITO A. SEPTIMO, ERLINDA B. DE LEON, CLARISSA T. DIMAANO, WILFREDO N. BACANI, MARINA R. VIVAR, VICTORIA S. UBALDO, JENNIE L. DOGWE, NORMA L. RONGCALES, EDITA C. SEPTIMO, TERESITA E. EVANGELISTA, CATALINA R. FRAGANTE, REBECCA D. BAGDOG, MARILYNNA C. KU, MARRISA M. SAMSON, HENEDINA B. CARILLO, NICASIO C. BRAVO, RUTH F. LACANILAO, MIRASOL C. BALIGOD, FELISA S. VILLACRUEL, MA. VIOLETA ELIZABETH Y. HERNANDEZ, ANTONIO C. OCAMPO, ADRIANO S. VALENCIA and ELEUTERIO S. VARGAS, respondents.

PANGANIBAN, J.:

Secretary Cario with fraud and deceit and praying that it be stopped from further investigating them and from rendering any decision in the administrative case. However, the trial court denied them a restraining order. They then amended their complaint and made it one for certiorari and mandamus. They alleged that the investigating committee was acting with grave abuse of discretion because its guidelines for investigation place the burden of proof on them by requiring them to prove their innocence instead of requiring Secretary Cario and his staff to adduce evidence to prove the charges against the teachers. On May 30, 1991, petitioner-appellee Adriano S. Valencia of the Ramon Magsaysay High School filed a motion to intervene, alleging that he was in the same situation as petitioners since he had likewise been charged and preventively suspended by respondent-appellant Cario for the same grounds as the other petitioner-appellees and made to shoulder the burden of proving his innocence under the committee's guidelines. The trial court granted his motion on June 3, 1991 and allowed him to intervene. On June 11, 1991, the Solicitor General answered the petitioner for certiorari and mandamus in behalf of respondent DECS Secretary. In the main he contended that, in accordance with the doctrine of primary resort, the trial court should not interfere in the administrative proceedings. The Solicitor General also asked the trial court to reconsider its order of June 3, 1991, allowing petitionerappellee Adriano S. Valencia to intervene in the case. Meanwhile, the DECS investigating committee rendered a decision on August 6, 1991, finding the petitionerappellees guilty, as charged and ordering their immediate dismissal. On August 15, 1991, the trial court dismissed the petition for certiorari and mandamus for lack of merit. Petitionerappellees moved for a reconsideration, but their motion was denied on September 11, 1991. The teachers then filed a petition for certiorari with the Supreme Court which, on February 18, 1992, issued a resolution en banc declaring void the trial court's order of dismissal and reinstating petitioner-appellees' action, even as it ordered the latter's reinstatement pending decision of their case. Accordingly, on March 25, 1992, the trial court set the case for hearing. June 8, 1992, it issued a pre-trial order which reads: As prayed for by Solicitor Bernard Hernandez, let this case be set for pre-trial conference on June 17, 1992 at 1:30 p.m., so as to expedite the proceedings hereof. In which case, DECS Secretary Isidro Cario, as the principal respondent, is hereby ordered to PERSONALLY APPEAR before this Court on said date and time, with a warning that should he fail to show up on said date, the Court will declare him as IN DEFAULT. Stated otherwise, for the said Pre-Trial Conference, the Court will not recognize any representative of his. By agreement of the parties, the trial conference was reset on June 26, 1992. However, Secretary Cario failed to appear in court on the date set. It was explained that he had to attend a conference in Maragondon, Cavite. Instead, he was represented by Atty. Reno Capinpin,

while the other respondents were represented by Atty. Jocelyn Pili. But the court just the same declared them as in default. The Solicitor General moved for a reconsideration, reiterating that Cario could not personally come on June 26, 1992 because of prior commitment in Cavite. It was pointed out that Cario was represented by Atty. Reno Capinpin, while the other respondents were represented by Atty. Jocelyn Pili, both of the DECS-NCR and that both had special powers of attorney. But the Solicitor General's motion for reconsideration was denied by the trial court. In its order of July 15, 1992, the court stated: The "Motion For Reconsideration" dated July 3, 1992 filed by the respondents thru counsel, is hereby DENIED for lack of merit. It appears too obvious that respondents simply did not want to comply with the lawful orders of the Court. The respondents having lost their standing in Court, the "Manifestation and Motion," dated July 3, 1992 filed by the Office of the Solicitor General is hereby DENIED due course. SO ORDERED. On July 3, 1992, the Solicitor General informed the trial court that Cario had ceased to be DECS Secretary and asked for his substitution. But the court failed to act on his motion. The hearing of the case was thereafter conducted ex parte with only the teachers allowed to present their evidence. On August 10, 1992, the trial court rendered a decision, in which it stated: The Court is in full accord with petitioners' contention that Rep. Act No. 4670 otherwise known as the "Magna Carta for Public School Teachers" is the primary law that governs the conduct of investigation in administrative cases filed against public school teachers, with Pres. Decree No. 807 as its supplemental law. Respondents erred in believing and contending that Rep. Act No. 4670 has already been superseded by the applicable provisions of Pres. Decree No. 807 and Exec. Order No. 292. Under the Rules of Statutory Construction, a special law, Rep. Act. No. 4670 in the case at bar, is not regarded as having been replaced by a general law, Pres. Decree No. 807, unless the intent to repeal or alter the same is manifest. A perusal of Pres. Decree No. 807 reveals no such intention exists, hence, Rep. Act No. 4670 stands. In the event that there is conflict between a special and a general law, the former shall prevail since it evidences the legislator's intent more clearly than that of the general statute and must be taken as an exception to the General Act. The provision of Rep. Act No. 4670 therefore prevails over Pres. Decree No. 807 in the composition and selection of the members of the investigating committee. Consequently, the committee tasked to investigate the charges filed against petitioners was illegally constituted, their composition and appointment being violative of Sec. 9 of Rep. Act No. 4670 hence all acts done by said body possess no legal color whatsoever. Anent petitioners' claim that their dismissal was effected without any formal investigation, the Court, after consideration of the circumstances surrounding the case, finds such claim meritorious. Although it cannot be gain

said that respondents have a cause of action against the petitioner, the same is not sufficient reason to detract from the necessity of basic fair play. The manner of dismissal of the teachers is tainted with illegality. It is a dismissal without due process. While there was a semblance of investigation conducted by the respondents their intention to dismiss petitioners was already manifest when it adopted a procedure provided for by law, by shifting the burden of proof to the petitioners, knowing fully well that the teachers would boycott the proceedings thereby giving them cause to render judgment ex-parte. The DISMISSAL therefore of the teachers is not justified, it being arbitrary and violative of the teacher's right to due process. Due process must be observed in dismissing the teachers because it affects not only their position but also their means of livelihood. WHEREFORE, premises considered, the present petition is hereby GRANTED and all the questioned orders/decisions of the respondents are hereby declared NULL and VOID and are hereby SET ASIDE. The reinstatement of the petitioners to their former positions without loss of seniority and promotional rights is hereby ORDERED. The payment, if any, of all the petitioners' back salaries, allowances, bonuses, and other benefits and emoluments which may have accrued to them during the entire period of their preventive suspension and/or dismissal from the service is hereby likewise ORDERED. SO ORDERED.
5

Whether or not Respondent Court of Appeals committed grave abuse of discretion in dismissing the appeal and in 8 affirming the trial court's decision. These issues, all closely related, boil down to a single question: whether private respondents were denied due process of law. The Court's Ruling The petition is bereft of merit. We agree with the Court of Appeals that private respondents were denied due process of law. Denial of Due Process At the outset, we must stress that we are tasked only to determine whether or not due process of law was observed in the administrative proceedings against herein private respondents. We note the Solicitor General's extensive disquisition that government employees do not 9 have the right to strike. On this point, the Court, in the 10 case of Bangalisan vs. Court of Appeals, has recently pronounced, through Mr. Justice Florenz D. Regalado: It is the settled rule in this jurisdiction that employees in the public service may not engage in strikes. While the Constitution recognizes the right of government employees to organize, they are prohibited from staging strikes, demonstrations mass leaves, walk-outs and other forms of mass action which will result in temporary stoppage or disruption of public services. The right of government employees to organize is limited only to the formation of unions or associations, without including the right to strike. More recently, in Jacinto vs. Court of Appeals, the Court explained the schoolteachers' right to peaceful assembly vis-a-vis their right to mass protest: Moreover, the petitioners here, except Merlinda Jacinto, were not penalized for the exercise of their right to assemble peacefully and to petition the government for a redress of grievances. Rather, the Civil Service Commission found them guilty of conduct prejudicial to the best interest of the service for having absented themselves without proper authority, from their schools during regular school days, in order to participate in the mass protest, their absence ineluctably resulting in the non-holding of classes and in the deprivation of students of education, for which they were responsible. Had petitioners availed themselves of their free time recess, after classes, weekends or holidays to dramatize their grievances and to dialogue with the proper authorities within the bounds of law, no one not the DECS, the CSC or even this Court could have held them liable for the valid exercise of their constitutionally guaranteed rights. As it was, the temporary stoppage of classes resulting from their activity necessarily disrupted public services, the very evil sought to be forestalled by the prohibition against strikes by government workers. Their act by its nature was enjoined by the Civil Service law, rules and regulations, for which they must, therefore, 12 be made answerable. In the present case, however, the issue is not whether the private respondents engaged in any prohibited activity which may warrant the imposition of disciplinary sanctions against them as a result of administrative proceedings. As already observed, the resolution of this case revolves around the question of due process of law, not on the right
11

From this adverse decision of the trial court; former DECS Secretary Isidro Cario filed an appeal with the Court of Appeals raising the following grounds: I. The trial court seriously erred in declaring appellants as in default. II. The trial court seriously erred in not ordering the proper substitution of parties. III. The trial court seriously erred in holding that R.A. No. 4670, otherwise known as "Magna Carta for Public School Teachers", should govern the conduct of the investigation conducted. IV. The trial court seriously erred in ruling that the dismissal of the teachers are without due process.
6

As mentioned earlier, the Court of Appeals affirmed the RTC decision, holding in the main that private respondents were denied due process in the administrative proceedings instituted against them. Hence, this petition for review. The Issues Before us, petitioners raise the following issues: I Whether or not Respondent Court of Appeals committed grave abuse of discretion in holding in effect that private respondents were denied due process of law. II Whether or not Respondent Court of Appeals seriously erred and committed grave abuse of discretion in applying strictly the provision of R.A. No. 4670 in the composition of the investigating committee. III
7

of government workers to strike. The issue is not whether private respondents may be punished for engaging in a prohibited action but whether, in the course of the investigation of the alleged proscribed activity, their right to due process has been violated. In short, before they can be investigated and meted out any penalty, due process must first be observed. In administrative proceedings, due process has been recognized to include the following: (1) the right to actual or constructive notice of the institution of proceedings which may affect a respondent's legal rights; (2) a real opportunity to be heard personally or with the assistance of counsel, to present witnesses and evidence in one's favor, and to defend one's rights; (3) a tribunal vested with competent jurisdiction and so constituted as to afford a person charged administratively a reasonable guarantee of honesty as well as impartiality; and (4) a finding by said tribunal which is supported by substantial evidence submitted for consideration during the hearing or contained in the records or made known to the parties 13 affected. The legislature enacted a special law, RA 4670 known as the Magna Carta for Public School Teachers, which specifically covers administrative proceedings involving public schoolteachers. Section 9 of said law expressly provides that the committee to hear public schoolteachers' administrative cases should be composed of the school superintendent of the division as chairman, a representative of the local or any existing provincial or national teachers' organization and a supervisor of the division. The pertinent provisions of RA 4670 read: Sec. 8. Safeguards in Disciplinary Procedure. Every teacher shall enjoy equitable safeguards at each stage of any disciplinary procedure and shall have: a: the right to be informed, in writing, of the charges; b. the right to full access to the evidence in the case; c. the right to defend himself and to be defended by a representative of his choice and/or by his organization, adequate time being given to the teacher for the preparation of his defense; and d. the right to appeal to clearly designated authorities. No publicity shall be given to any disciplinary action being taken against a teacher during the pendency of his case. Sec. 9. Administrative Charges. Administrative charges against teacher shall be heard initially by a committee composed of the corresponding School Superintendent of the Division or a duly authorized representative who would at least have the rank of a division supervisor, where the teacher belongs, as chairman, a representative of the local or, in its absence, any existing provincial or national teacher's organization and a supervisor of the Division, the last two to be designated by the Director of Public Schools. The committee shall submit its findings, and recommendations to the Director of Public Schools within thirty days from the termination of the hearings: Provided, however, That where the school superintended is the complainant or an interested party, all the members of the committee shall be appointed by the Secretary of Education. The foregoing provisions implement the Declaration of Policy of the statute; that is, to promote the "terms of employment and career prospects" of schoolteachers.

In the present case, the various committees formed by DECS to hear the administrative charges against private respondents did not include "a representative of the local or, in its absence, any existing provincial or national teacher's organization" as required by Section 9 of RA 4670. Accordingly, these committees were deemed to have no competent jurisdiction. Thus, all proceedings undertaken by them were necessarily void. They could not provide any basis for the suspension or dismissal of private respondents. The inclusion of a representative of a teachers' organization in these committees was indispensable to ensure an impartial tribunal. It was this requirement that would have given substance and meaning to the right to be heard. Indeed, in any proceeding, the essence of procedural due process is embodied in the basic requirement of notice and a real 14 opportunity to be heard. Petitioners argue that the DECS complied with Section 9 of RA 4670, because "all the teachers who were members of the various committees are members of either the Quezon City Secondary Teachers Federation or the 15 Quezon City Elementary Teachers Federation" and are deemed to be the representatives of a teachers' organization as required by Section 9 of RA 4670. We disagree. Mere membership of said teachers in their respective teachers' organizations does not ipso facto make them authorized representatives of such organizations as contemplated by Section 9 of RA 4670. Under this section, the teachers' organization possesses the right to indicate its choice of representative to be included by the DECS in the investigating committee. Such right to designate cannot be usurped by the secretary of education or the director of public schools or their underlings. In the instant case, there is no dispute that none of the teachers appointed by the DECS as members of its investigating committee was ever designated or authorized by a teachers' organization as its representative in said committee. Contrary to petitioners' asseverations, RA 4670 is applicable to this case. It has not been expressly repealed by the general law PD 807, which was enacted later, nor has it been shown to be inconsistent with the latter. It is a fundamental rule of statutory construction that "repeals by implication are not favor. An implied repeal will not be allowed unless it is convincingly and unambiguously demonstrated that the two laws are so clearly repugnant and patently inconsistent that they cannot co-exist. This is based on the rationale that the will of the legislature cannot be overturned by the judicial function of construction and interpretation. Courts cannot take the place of Congress in repealing statutes. Their function is to try to harmonize, as much as possible, seeming conflicts in the laws and resolve doubts in favor of their 17 validity and co-existence." Thus, a subsequent general law does not repeal a prior special law, "unless the intent to repeal or alter is manifest, although the terms of the general law are broad enough to include the cases 18 embraced in the special law." The aforementioned Section 9 of RA 4670, therefore, reflects the legislative intent to impose a standard and a separate set of procedural requirements in connection with administrative proceedings involving public schoolteachers. Clearly, private respondents' right to due
16

10

process of law requires compliance with these requirements laid down by RA 4670. Verba legis non est recedendum. Hence, Respondent Court of Appeals, through Mr. Justice Vicente V. Mendoza who is now a member of this Court, perceptively and correctly stated: Respondent-appellants argue that the Magna Carta has been superseded by the Civil Service Decree (P.D. No. 807) and that pursuant to the latter law the head of a department, like the DECS secretary, or a regional director, like the respondent-appellant John Doe (not his real name), can file administrative charges against a subordinate, investigate him and take disciplinary action against him if warranted by his findings. Respondentappellants cite in support of their argument the following provisions of the Civil Service Decree (P.D. No. 807). Sec. 37. Disciplinary Jurisdiction. xxx xxx xxx b) The heads of departments, agencies and instrumentalities. . . shall have jurisdiction to investigate and decide matters involving disciplinary action against officers and employees under their jurisdiction. . . . Sec. 38. Procedure in Administrative Cases Against NonPresidential Appointees. a) Administrative Proceedings may be commenced against a subordinate officer or the employee by the head of department or officer of equivalent rank, or head of local government, or chiefs of agencies, or regional directors, or upon sworn, written complaint of any other persons. There is really no repugnance between the Civil Service Decree and the Magna Carta for Public School Teachers. Although the Civil Service Decree gives the head of department or the regional director jurisdiction to investigate and decide disciplinary matters, the fact is that such power is exercised through committees. In cases involving public school teachers, the Magna Carta provides that the committee be constituted as follows: Sec. 9. Administrative Charges. Administrative charges against a teacher shall be heard initially by a committee composed of the corresponding School Superintendent of the Division or a duly authorized representative who would at least have the rank of a division supervisor, where the teacher belongs, as chairman, a representative of the local or, in its absence, any existing provincial or national teacher's organization and a supervisor of the Division, the last two to be designated by the Director of Public Schools. The committee shall submit its findings, and recommendations to the Director of Public Schools within thirty days from the termination of the hearings: Provided, however, that where the school superintendent is the complainant or an interested party, all the members of the committee shall be appointed by the Secretary of Education. Indeed, in the case at bar, neither the DECS [s]ecretary nor the DECS-NCR regional director personally conducted the investigation but entrusted it to a committee composed of a division supervisor, secondly and elementary school teachers, and consultants. But there was no representative of a teachers organization. This is a serious flaw in the composition of the committee because the provision for the representation of a teachers

organization is intended by law for the protection of the rights of teachers facing administrative charges. There is thus nothing in the Magna Carta that is in any way inconsistent with the Civil Service Decree insofar as procedures for investigation is concerned. To the contrary, the Civil Service Decree, [S]ec. 38(b) affirms the Magna Carta by providing that the respondent in an administrative case may ask for a "formal investigation," which was what the teachers did in this case by questioning the absence of a representative of a teachers organization in the investigating committee. The administrative committee considered the teachers to have waived their right to a hearing after the latter's counsel walked out of the preliminary hearing. The committee should not have made such a ruling because the walk out was staged in protest against the procedures of the committee and its refusal to give the teachers' counsel a copy of the guidelines. The committee concluded its investigation and ordered the dismissal of the teachers without giving the teachers the right to full access of the evidence against them and the opportunity to defend themselves. Its predisposition to find petitionerappellees guilty of the charges was in fact noted by the Supreme Court when in its resolution in G.R. No. 101943 (Rosario Septimo v. Judge Martin Villarama, Jr.) it stated: The facts and issues in this case are similar to the facts and issues in Hon. Isidro Cario, et al. v. Hon. Carlos C. Ofilada, et al. G.R. No. 100206, August 22, 1961. As in the Cario v. Ofilada case, the officials of the Department of Culture and Education are predisposed to summarily hold the petitioners guilty of the charges against them. In fact, in this case Secretary Cario, without awaiting formal administrative procedures and on the basis of reports and "implied admissions" found the petitioners guilty as charged and dismissed them from the service in separate decisions dated May 16, 1997 and August 6, 1991. The teachers went to court. The Court 19 dismissed the case. Furthermore, this Court sees no valid reason to disregard the factual findings and conclusions of the Court of Appeals. It is not our function "to assess and evaluate all over again the evidence, testimonial and documentary, adduced by the parties particularly where, such as here, the findings of both the trial court and the appellate court 20 coincide." It is as clear as day to us that the Court of Appeals committed to reversible error in affirming the trial court's decision setting aside the questioned orders of petitioners; and ordering the unqualified reinstatement of private respondents and the payment of them of salaries, allowances, bonuses and other benefits that accrued to their benefit during the entire duration of 21 their suspension or dismissal. Because the administrative proceedings involved in this case are void, no delinquency or misconduct may be imputed to private respondents. Moreover, the suspension or dismissal meted on them is baseless. Private respondents should, 22 as a consequence, be reinstated and awarded all monetary benefits that may have accrued to them during 23 the period of their unjustified suspension or dismissal. This Court will never countenance a denial of the fundamental right to due process, which is a cornerstone of our legal system.

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WHEREFORE, premises considered, the petition is hereby DENIED for its utter failure to show any reversible error on the part of the Court of Appeals. The assailed Decision is thus AFFIRMED. SO ORDERED.

(4) the turn over of all assets, properties and records of the KBMBPM the Management Committee. The second case. G.R. No. 91927 (hereinafter referred to as the Bunye case), seeks the nullification of the Resolution of 4 January 1990 of the Sandiganbayan admitting the Amended Information against petitioners in Criminal Case No. 13966 and denying their motion to order or direct preliminary investigation, and its Resolution of 1 February 1990 denying the motion to reconsider the former. The procedural and factual antecedents are not disputed. On 2 September 1985, the Municipal Government of Muntinlupa (hereinafter, Municipality), Metro Manila, thru its then Mayor Santiago Carlos, Jr., entered into a contract with the KILUSANG BAYAN SA PAGLILINGKOD NG MGA MAGTITINDA SA BAGONG PAMILIHANG BAYAN NG MUNTINLUPA, INC. (KBMBPM) represented by its General Manager, Amado Perez, for the latter's management and operation of the new Muntinlupa public market. The contract provides for a twenty-five (25) year term commencing on 2 September 1985, renewable for a like period, unless sooner terminated and/or rescinded by mutual agreement of the parties, at a monthly consideration of Thirty-Five Thousand Pesos (P35,000) to be paid by the KBMBPM within the first five (5) days of each month which shall, however, be increased by ten percent (10%) each year during the first five (5) years 1 only. The KBMBPM is a service cooperative organized by and composed of vendors occupying the New Muntinlupa Public Market in Alabang, Muntinlupa, Metro Manila pursuant to Presidential Decree No. 175 and Letter of Implementation No. 23; its articles of incorporation and bylaws were registered with the then Office of the Bureau of Cooperatives Development (thereafter the Bureau of Agricultural Cooperatives Development or BACOD and 2 now the Cooperative Development Authority). Following his assumption into office as the new mayor succeeding Santiago Carlos, Jr., petitioner Ignacio Bunye, claiming to be particularly scandalized by the "virtual 50year term of the agreement, contrary to the provision of Section 143, paragraph 3 of Batas Pambansa Blg. 337," and the "patently inequitable rental," directed a review of 3 the aforesaid contract. He sought opinions from both the Commission on Audit and the Metro Manila Commission (MMC) on the validity of the instrument. In separate letters, these agencies urged that appropriate legal steps be taken towards its rescission. The letter of Hon. Elfren Cruz of the MMC even granted the Municipality authority "to take the necessary legal steps for the cancellation/recission of the above cited contract and make representations with KBMBPM for the immediate transfer/takeover of the possession, management and operation of the New Muntinlupa Market to the Municipal 4 Government of Muntinlupa." Consequently, upon representations made by Bunye with the Municipal Council, the latter approved on 1 August 1988 Resolution No. 45 abrogating the contract. To implement this resolution, Bunye, together with his copetitioners and elements of the Capital Command of the Philippine Constabulary, proceeded, on 19 August 1986, to the public market and announced to the general public and the stallholders thereat that the Municipality was

G.R. No. 85439 January 13, 1992 KILUSANG BAYAN SA PAGLILINGKOD NG MGA MAGTITINDA NG BAGONG PAMILIHANG BAYAN NG MUNTINLUPA, INC. (KBMBPM), TERESITA A. FAJARDO, NADYESDA B. PONSONES, MA. FE V. BOMBASE, LOIDA D. LUCES, MARIO S. FRANCISCO, AMADO V. MANUEL and ROLANDO G. GARCIA, incumbent members of the Board, AMADO G. PEREZ and MA. FE V. BOMBASE, incumbent General Manager and Secretary-Treasurer, respectively, petitioners, vs. HON. CARLOS G. DOMINGUEZ, Secretary of Agriculture, Regional Director of Region IV of the Department of Agriculture ROGELIO P. MADRIAGA, RECTO CORONADO and Municipal Mayor IGNACIO R. BUNYE, both in his capacity as Municipal Mayor of Muntinlupa, Metro Manila and as Presiding Officer of Sangguniang Bayan ng Muntinglupa, and JOHN DOES, respondents. G.R. No. 91927 January 13, 1992 IGNACIO R. BUNYE, JAIME R. FRESNEDI, CARLOS G. TENSUAN, VICTOR E. AGUINALDO, ALEJANDRO I. MARTINEZ, EPIFANIO A. ESPELETA, REY E. BULAY, LUCIO B. CONSTANTINO, ROMAN E. NIEFES, NEMESIO O. MOZO, ROGER SMITH, RUFINO B. JOAQUIN, NOLASCO I. DIAZ, RUFINO IBE and NESTOR SANTOS, petitioners, vs. THE SANDIGANBAYAN, THE OMBUDSMAN and ROGER C. BERBANO, Special Prosecutor III, respondents. Jose O. Villanueva and Roberto B. Romanillos for petitioners in G.R. No. 85439. Alampay & Manhit Law Offices for petitioners in G.R. No. 91927.

DAVIDE, JR., J.: These cases have been consolidated because they are closely linked with each other as to factual antecedents and issues. The first case, G.R. No. 85439 (hereinafter referred to as the Kilusang Bayan case), questions the validity of the order of 28 October 1988 of then Secretary of Agriculture Hon. Carlos G. Dominguez which ordered: (1) the takeover by the Department of Agriculture of the management of the petitioner Kilusang Bayan sa Paglilingkod Ng Mga Magtitinda ng Bagong Pamilihang Bayan ng Muntilupa, Inc. (KBMBPM) pursuant to the Department's regulatory and supervisory powers under Section 8 of P.D. No. 175, as amended, and Section 4 of Executive Order No. 13, (2) the creation of a Management Committee which shall assume the management of KBMBPM upon receipt of the order, (3) the disbandment of the Board of Directors, and

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taking over the management and operation of the facility, and that the stallholders should henceforth pay their market fees to the Municipality, thru the Market 5 Commission, and no longer to the KBMBPM. On 22 August 1988, the KBMBPM filed with Branch 13 of the Regional Trial Court of Makati a complaint for breach of contract, specific performance and damages with prayer for a writ of preliminary injunction against the Municipality and its officers, which was docketed as Civil 6 Case No. 88-1702. The complaint was premised on the alleged illegal take-over of the public market effected "in excess of his (Bunye's) alleged authority" and thus "constitutes breach of contract and duty as a public official." The writ applied for having been denied, the KBMBPM officers resisted the attempts of Bunye and company to complete the take-over; they continued holding office in the KBS building, under their respective official capacities. The matter having been elevated to this Court by way of certiorari, 8 We remanded the same to the Court of 9 Appeals which docketed it as C.A.-G.R. No. L-16930. On 26 August 1988, Amado Perez filed with the Office of the Ombudsman a letter-complaint charging Bunye and his co-petitioners with oppression, harassment, abuse of authority and violation of the Anti-Graft and Corrupt 10 Practices Act for taking over the management and 11 operation of the public market from KBMBPM. In a subpoena dated 7 October 1988, prosecutor Mothalib C. Onos of the Office of the Special Prosecutor directed Bunye and his co-petitioners to submit within ten (10) days from receipt thereof counter-affidavits, affidavits of 12 their witnesses and other supporting documents. The subpoena and letter-complaint were received on 12 October 1988. On 20 October 1988, two (2) days before the expiration of the period granted to file said documents, Bunye, et al. filed by mail an urgent motion for extension of "at least fifteen (15) days from October 22, 1988" within which to 13 comply with the subpoena. Thereafter, the following transpired which subsequently gave rise to these petitions: G.R. No. 85439 In the early morning of 29 October 1988, a Saturday, respondent Madriaga and Coronado, allegedly accompanied by Mayor Bunye and the latters' heavily armed men, both in uniform and in civilian clothes, together with other civilians, namely: Romulo Bunye II, Alfredo Bunye, Tomas Osias, Reynaldo Camilon, Benjamin Taguibao, Benjamin Bulos and other unidentified persons, allegedly through force, violence and intimidation, forcibly broke open the doors of the offices of petitioners located at the second floor of the KBS Building, new Muntinlupa Public Market, purportedly to serve upon petitioners the Order of respondent Secretary of Agriculture dated 28 October 1988, and to implement the same, by taking over and assuming the management of KBMBPM, disbanding the then incumbent Board of Directors for that purpose and excluding and prohibiting the General Manager and the other officers from 14 exercising their lawful functions as such. The Order of 15 the Secretary reads as follows: ORDER
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WHEREAS, the KILUSANG BAYAN SA PAGLILINGKOD NG MGA MAGTITINDA NG BAGONG PAMILIHANG BAYAN NG MUNTINLUPA, INC., (KBMBPM), Alabang, Muntinlupa, Metro Manila is a Cooperative registered under the provisions of Presidential Decree No. 175, as amended; WHEREAS, the Department of Agriculture is empowered to regulate and supervise cooperatives registered under the provisions of Presidential Decree No. 175, as amended; WHEREAS, the general membership of the KBMBPM has petitioned the Department of Agriculture for assistance in the removal of the members of the Board of Directors who were not elected by the general membership of said cooperative; WHEREAS, the on-going financial and management audit of the Department of Agriculture auditors show (sic) that the management of the KBMBPM is not operating that cooperative in accordance with PD. 175, LOI No. 23, the Circulars issued by DA/BACOD and the provisions of the by-laws of KBMBPM; WHEREAS, the interest of the public so demanding it is evident and urgently necessary that the KBMBPM MUST BE PLACED UNDER MANAGEMENT TAKE-OVER of the Department of Agriculture in order to preserve the financial interest of the members of the cooperative and to enhance the cooperative development program of the government; WHEREAS, it is ordered that the Department of Agriculture in the exercise of its regulatory and supervisory powers under Section 8 of PD 175, as amended, and Section 4 of Executive Order No. 113, take over the management of KBMBPM under the following directives: 1. THAT a Management Committee is hereby created composed of the following: a) Reg. Dir. or OIC RD DA Region IV b) Atty. Rogelio P. Madriaga BACOD c) Mr. Recto Coronado KBMBPM d) Mrs. Nadjasda Ponsones KBMBPM e) One (1) from the Municipal Government of Muntinlupa to be designated by the Sangguniang Pambayan ng Muntinlupa; 2. THAT the Management Committee shall, upon receipt of this Order, assume the management of KBMBPM; 3. THAT the present Board of Directors is hereby disbanded and the officers and Manager of the KBMBPM are hereby directed to turnover all assets, properties and records of the KBMBPM to the Management Committee herein created; 4. THAT the Management Committee is hereby empowered to promulgate rules of procedure to govern its workings as a body; 5. THAT the Management Committee shall submit to the undersigned thru the Director of BACOD monthly reports on the operations of KBMBPM; 6. THAT the Management Committee shall call a General Assembly of all registered members of the KBMBPM within Ninety (90) days from date of this Order to decide

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such matters affecting the KBMBPM, including the election of a new set of Board of Director (sic). This Order takes effect immediately and shall continue to be in force until the members of the Board of Directors shall have been duly elected and qualified. Done this 28th day of October, 1988 at Quezon City. As claimed by petitioners, the Order served on them was not written on the stationary of the Department, does not bear its seal and is a mere xerox copy. The so-called petition upon which the Order is based appears to be an unverified petition dated 10 October 16 1988 signed, according to Mayor Bunye, by 371 members of the KBMBPM. On 2 November 1988, petitioners filed the petition in this case alleging, inter alia, that: (a) Respondent Secretary acted without or in excess of jurisdiction in issuing the Order for he arrogated unto himself a judicial function by determining the alleged guilt of petitioners on the strength of a mere unverified petition; the disbandment of the Board of Directors was done without authority of law since under Letter of Implementation No. 23, removal of officers, directors or committee members could be done only by the majority of the members entitled to vote at an annual or special general assembly and only after an opportunity to be heard at said assembly. (b) Respondent Secretary acted in a capricious, whimsical, arbitrary and despotic manner, so patent and gross that it amounted to a grave abuse of discretion. (c) The Order is a clear violation of the By-Laws of KBMBPM and is likewise illegal and unlawful for it allows or tolerates the violation of the penal provisions under paragraph (c), Section 9 of P.D. No. 175. (d) The Order is a clear violation of the constitutional right 17 of the individual petitioners to be heard. They pray that upon the filing of the petition, respondents, their agents, representatives or persons acting on their behalf be ordered to refrain, cease and desist from enforcing and implementing the questioned Order or from excluding the individual petitioners from the exercise of their rights as such officers and, in the event that said acts sought to be restrained were already partially or wholly done, to immediately restore the management and operation of the public market to petitioners, order respondents to vacate the premises and, thereafter, preserve the status quo; and that, finally, the challenged Order be declared null and void. In the Resolution of 9 October 1988, We required the respondents to Comment on the petition. Before any Comment could be filed, petitioners filed on 2 January 1989 an Urgent Ex-Parte Motion praying that respondent Atty. Rogelio Madriaga, who had assumed the position of Chairman of the Management Committee, be ordered to stop and/or cancel the scheduled elections of the officers of the KBMBPM on 6 January 1989 and, henceforth, desist from scheduling any election of officers or Members of the Board of Directors thereof until further orders on the 19 Court. The elections were, nevertheless, held and a new board of directors was elected. So, on 19 January 20 1989, petitioners filed a supplemental motion praying that respondent Madriaga and the "newly elected Board of
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Directors be ordered to cease and desist from assuming, performing or exercising powers as such, and/or from removing or replacing the counsels of petitioners as counsels for KBMBPM and for Atty. Fernando Aquino, Jr., to cease and desist from unduly interfering with the affairs and business of the cooperative." Respondent Bunye, by himself, filed his Comment on 23 21 January 1989. He denies the factual allegations in the petition and claims that petitioners failed to exhaust administrative remedies. A reply thereto was filed by 22 petitioners on 7 February 1989. Respondent Recto Coronado filed two (2) Comments. The 23 first was filed on 6 February 1989 by his counsel, Atty. Fernando Aquino, Jr., and the second, which is for both him and Atty. Madriaga, was filed by the latter on 10 24 February 1989. On 20 February 1989, petitioners filed a Reply to the first 25 Comment of Coronado and an Ex-Parte Motion for the 26 immediate issuance of a cease and desist order praying that the so-called new directors and officers of KBMBPM, namely: Tomas M. Osias, Ildefonso B. Reyes, Paulino Moldez, Fortunato M. Medina, Aurora P. del Rosario, Moises Abrenica, and Lamberto Casalla, be ordered to immediately cease and desist from filing notices of withdrawals or motions to dismiss cases filed by the Cooperative now pending before the courts, administrative offices and the Ombudsman and Tanodbayan, and that if such motions or notices were already filed, to immediately withdraw and desist from further pursuing the same until further orders of this Court. The latter was precipitated by the Resolution No. 19 of the "new" board of directors withdrawing all cases filed by its predecessors against Bunye, et al., and more particularly the following cases: (a) G.R. No. 85439 (the instant petition), (b) Civil Case No. 88-1702, (c) OSP Case No. 88-2110 before the Ombudsman, (d) IBP Case No. 88-0119 before the 27 Tanodbayan, and Civil Case No. 88-118 for Mandamus. On 1 March 1989, We required the Solicitor General to file his Comment to the petition and the urgent motion for the 28 immediate issuance of a cease and desist order. A motion to dismiss the instant petition was filed on 30 29 March 1989. On 19 April 1989, We resolved to dismiss 30 the case and consider it closed and terminated. Thereupon, after some petitioners filed a motion for clarification and reconsideration, We set aside the dismissal order and required the new directors to comment on the Opposition to Motion to Dismiss filed by 31 the former. The new board, on 14 June 1989, prayed that its Manifestation of 6 June 1989 and Opposition dated 9 June 1989, earlier submitted it response to petitioners' motion for reconsideration of the order dismissing the 32 instant petition, be treated as its Comment. Both parties then continued their legal fencing, serving several pleadings on each other. In Our Resolution of 9 August 1989, We gave the petition due course and required the parties to submit their respective Memoranda. On 14 August 1989, petitioners filed an urgent ex-parte motion for the immediate issuance of a cease and desist 34 order in view of the new board's plan to enter into a new management contract; the motion was noted by this Court
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on 23 August 1989. A second ex-parte motion, noted on 18 October 1989, was filed on 19 September 1989 asking this court to consider the "Invitation to pre-qualify and bid" 35 for a new contract published by respondent Bunye. In a belated Comment for the respondent Secretary of Agriculture filed on 22 September 1989, the Office of the Solicitor General asserts that individual petitioners, who were not allegedly elected by the members or duly designated by the BACOD Director, have no right or authority to file this case; the assailed Order of the Secretary was issued pursuant to P.D. No. 175, more particularly Section 8 thereof which authorizes him "(d) to suspend the operation or cancel the registration of any cooperative after hearing and when in its judgment and based on findings, such cooperative is operating in violation of this Decree, rules and regulations, existing laws as well as the by-laws of the cooperative itself;" the Order is reasonably necessary to correct serious flaws in the cooperative and provide interim measures until election of regular members to the board and officers thereof; the elections conducted on 6 January 1989 are valid; and that the motion to dismiss filed by the new board of directors binds the cooperative. It prays for the dismissal of the petition. Respondent Secretary of Agriculture manifested on 22 September 1989 that he is adopting the Comment submitted by the Office of the Solicitor General as his 37 memorandum; petitioners and respondents Coronado and Madriaga filed their separate Memoranda on 6 38 November 1989; while the new board of directors 39 submitted its Memorandum on 11 December 1989. The new KBMBPM board submitted additional pleadings on 16 February 1990 which it deemed relevant to the issues involved herein. Reacting, petitioners filed a motion to strike out improper and inadmissible pleadings and annexes and sought to have the pleaders cited for contempt. Although We required respondents to comment, the latter did not comply. Nevertheless, a manifestation was filed by the same 40 board on 25 February 1991 informing this Court of the holding, on 9 January 1991, of its annual general assembly and election of its board of directors for 1991. It then reiterates the prayer that the instant petition be considered withdrawn and dismissed. Petitioners filed a counter manifestation alleging that the instant petition was 41 already given due course on 9 August 1989. In its traverse to the counter manifestation, the new board insists that it "did not derive authority from the October 28, 1988 Order, the acts of the Management Committee, nor (sic) from the elections held in (sic) January 6, 1989," but rather from the members of the cooperative who elected them into office during the elections. Petitioners filed a rejoinder asserting that the election of new directors is not a supervening event independent of the main issue in the present petition and that to subscribe to the argument that the issues in the instant petition became moot with their assumption into office is to reward a wrong done. G. R. NO. 91927 Petitioners claim that without ruling on their 20 October 1988 motion for an extension of at last 15 days from 22 October 1988 within which to file their counter-affidavits, which was received by the Office of the Special
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Prosecutor on 3 November 1988, Special Prosecutor Onos promulgated on 11 November 1988 a Resolution finding the evidence on hand sufficient to establish a prima facie case against respondents (herein petitioners) and recommending the filing of the corresponding 42 information against them before the Sandiganbayan. Petitioners also claim that they submitted their counter43 affidavits on 9 November 1988. In their motion dated 2 December 1988, petitioners move 44 for a reconsideration of the above Resolution, which 45 was denied by Onos in his 18 January 1989 Order. The information against the petitioners was attached to this order. Upon submission of the records for his approval, the Ombudsman issued a first indorsement on 4 April 1989 referring to "Judge Gualberto J. de la Llana, Acting Director , IEO/RSSO, this Office, the within records of OSP Case No. 88-02110 . . . for further preliminary 46 investigation . . ." Thereafter, on 28 April 1989, Bunye and company received a subpoena from de la Llana requiring them to 47 appear before the latter on 25 April 1989, submit a report and file comment. After being granted an extension, Bunye and company submitted their comment on 18 May 48 1989. On 22 August 1989, de la Llana recommended the filing of an information for violation of section 3 (e) of the Anti49 Graft and Corrupt Practices Act. The case was referred to special prosecuting officer Jose Parentela, Jr. who, in 50 his Memorandum to the Ombudsman through the Acting Special Prosecutor, likewise urged that an information be filed against herein petitioners. On 3 October 1989, the Ombudsman signed his conformity to the Memorandum and approved the 18 January information prepared by Onos, which was then filed with the Sandiganbayan. Consequently, Bunye, et al. were served arrest warrants issued by the Sandiganbayan. Detained at the NBI on 9 October 1989, they claim to have discovered only then the existence of documents recommending and approving the filing of the complaint and a memorandum by special prosecutor Bernardita G. Erum proposing the dismissal of 51 the same. Arraignment was set for 18 October 1989.
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However, on 14 October 1989, petitioners filed with the Sandiganbayan an "Omnibus Motion to Remand to the Office of the Ombudsman; to Defer Arraignment and to 53 Suspend Proceedings." Subsequently, through new counsel, petitioners filed on 17 October 1989 a Consolidated Manifestation and 54 Supplemental Motion praying, inter alia, for the quashal of the information on the ground that they were deprived of their right to a preliminary investigation and that the information did not charge an offense. The Sandiganbayan issued an order on 18 October 1989 deferring arraignment and directing the parties to submit 55 their respective memoranda, which petitioners complied 56 with on 2 November 1989. On 16 November 1989, special Prosecutor Berbano filed a motion to admit amended 57 information.

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On 17 November 1989, the Sandiganbayan handed down 58 a Resolution denying for lack of merit the Omnibus Motion to Remand the Case To The Office of the Ombudsman, to Defer Arraignment and to Suspend Proceedings. Petitioners then filed a motion to order a 59 preliminary investigation on the basis of the introduction by the amended information of new, material and substantive allegations, which the special prosecutor 60 opposed, thereby precipitating a rejoinder filed by 61 petitioners. On 4 January 1990, the Sandiganbayan handed down a 62 Resolution admitting the Amended Information and denying the motion to direct preliminary investigation. Their motion to reconsider this Resolution having been 63 denied in the Resolution of 1 February 1990, petitioners filed the instant petition on 12 February 1990. Petitioners claim that respondent Sandiganbayan acted without or in excess of jurisdiction or with manifest grave abuse of discretion amounting to lack of jurisdiction in denying petitioners their right to preliminary investigation and in admitting the Amended Information. They then pray that: (a) the 4 January and 1 February 1990 Resolutions of the Sandiganbayan, admitting the amended information and denying the motion for reconsideration, respectively, be annulled; (b) a writ be issued enjoining the Sandiganbayan from proceeding further in Criminal Case No. 13966; and (c) respondents be enjoined from pursuing further actions in the graft case. We required the respondents to Comment on the petition. On 21 February 1990, petitioners' counsel filed a motion to drop Epifanio Espeleta and Rey E. Dulay as petitioners, 64 and in the Comment they filed on 30 March 1990, in compliance with Our Resolution of 1 March 1990, they state that they do not interpose any objection to the motion. On 20 March 1990, the Office of the Solicitor General moved that it be excused from filing comment for the respondents as it cannot subscribe to the position taken by the latter with respect to the questions of law involved. 65 We granted this motion in the resolution of 8 May 1990. Respondent Berbano filed his comment on 10 September 1991 and petitioners replied on 20 December 1990; Berbano subsequently filed a Rejoinder thereto on 11 66 January 1991. The Sandiganbayan then filed a manifestation proposing that it be excused from filing comment as its position on the matters in issue is adequately stated in the 67 resolutions sought to be annulled. On 7 March 1991, We resolved to note the manifestation and order the instant petition consolidated with G.R. No. 85439. The present dispute revolves around the validity of the antecedent proceedings which led to the filing of the original information on 18 January 1989 and the amended information afterwards. THE ISSUES AND THEIR RESOLUTION 1. G. R. No. 85439. As adverted to in the introductory portion of this Decision, the principal issue in G.R. No. 85439 is the validity of the 28 October 1988 Order of respondent Secretary of Agriculture. The exordium of said Order unerringly indicates that its basis is the alleged petition of the general

membership of the KBMBPM requesting the Department for assistance "in the removal of the members of the Board of Directors who were not elected by the general membership" of the cooperative and that the "ongoing financial and management audit of the Department of Agriculture auditors show (sic) that the management of the KBMBPM is not operating that cooperative in accordance with P.D. 175, LOI 23, the Circulars issued by DA/BACOD and the provisions and by-laws of KBMBPM." It is also professed therein that the Order was issued by the Department "in the exercise of its regulatory and supervisory powers under Section 8 of P.D. 175, as amended, and Section 4 of Executive Order No. 113." Respondents challenge the personality of the petitioners to bring this action, set up the defense of non-exhaustion of administrative remedies, and assert that the Order was lawfully and validly issued under the above decree and Executive Order. We find merit in the petition and the defenses interposed do not persuade Us. Petitioners have the personality to file the instant petition and ask, in effect, for their reinstatement as Section 3, Rule 65 of the Rules of Court, defining an action for mandamus, permits a person who has been excluded from the use and enjoyment of a right or office to which he 68 is entitled, to file suit. Petitioners, as ousted directors of the KBMBPM, are questioning precisely the act of respondent Secretary in disbanding the board of directors; they then pray that this Court restore them to their prior stations. As to failure to exhaust administrative remedies, the rule is well-settled that this requirement does not apply where the respondent is a department secretary whose acts, as an alter ego of the President, bear the implied approval of 69 the latter, unless actually disapproved by him. This doctrine of qualified political agency ensures speedy access to the courts when most needed. There was no need then to appeal the decision to the office of the President; recourse to the courts could be had immediately. Moreover, the doctrine of exhaustion of administrative remedies also yields to other exceptions, such as when the question involved is purely legal, as in 70 the instant case, or where the questioned act is patently 71 illegal, arbitrary or oppressive. Such is the claim of petitioners which, as hereinafter shown, is correct. And now on the validity of the assailed Order. Regulation 34 of Letter of Implementation No. 23 (implementing P.D. No. 175) provides the procedure for the removal of directors or officers of cooperatives, thus: An elected officer, director or committee member may be removed by a vote of majority of the members entitled to vote at an annual or special general assembly. The person involved shall have an opportunity to be heard. A substantially identical provision, found in Section 17, Article III of the KBMBPM's by-laws, reads: Sec. 17. Removal of Directors and Committee Members. Any elected director or committee member may be removed from office for cause by a majority vote of the members in good standing present at the annual or special general assembly called for the purpose after having been given the opportunity to be heard at the assembly.

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Under the same article are found the requirements for the holding of both the annual general assembly and a special general assembly. Indubitably then, there is an established procedure for the removal of directors and officers of cooperatives. It is likewise manifest that the right to due process is respected by the express provision on the opportunity to be heard. But even without said provision, petitioners cannot be deprived of that right. The procedure was not followed in this case. Respondent Secretary of Agriculture arrogated unto himself the power of the members of the KBMBPM who are authorized to vote to remove the petitioning directors and officers. He cannot take refuge under Section 8 of P.D. No. 175 which grants him authority to supervise and regulate all cooperatives. This section does not give him that right. An administrative officer has only such powers as are expressly granted to him and those necessarily implied in 72 the exercise thereof. These powers should not be extended by implication beyond what may to necessary 73 for their just and reasonable execution. Supervision and control include only the authority to: (a) act directly whenever a specific function is entrusted by law or regulation to a subordinate; (b) direct the performance of duty; restrain the commission of acts; (c) review, approve, reverse or modify acts and decisions of subordinate officials or units; (d) determine priorities in the execution of plans and programs; and (e) prescribe standards, guidelines, plans and programs. Specifically, administrative supervision is limited to the authority of the department or its equivalent to: (1) generally oversee the operations of such agencies and insure that they are managed effectively, efficiently and economically but without interference with day-to-day activities; (2) require the submission of reports and cause the conduct of management audit, performance evaluation and inspection to determine compliance with policies, standards and guidelines of the department; (3) take such action as may be necessary for the proper performance of official functions, including rectification of violations, abuses and other forms of mal-administration; (4) review and pass upon budget proposals of such agencies but 74 may not increase or add to them. The power to summarily disband the board of directors may not be inferred from any of the foregoing as both P.D. No. 175 and the by-laws of the KBMBPM explicitly mandate the manner by which directors and officers are to be removed. The Secretary should have known better than to disregard these procedures and rely on a mere petition by the general membership of the KBMBPM and an on-going audit by Department of Agriculture auditors in exercising a power which he does not have, expressly or impliedly. We cannot concede to the proposition of the Office of the Solicitor General that the Secretary's power under paragraph (d), Section 8 of P.D. No. 175 above quoted to suspend the operation or cancel the registration of any cooperative includes the "milder authority of suspending officers and calling for the election of new officers." Firstly, neither suspension nor cancellation includes the take-over and ouster of incumbent directors and officers, otherwise the law itself would have expressly so stated. Secondly, even granting that the law intended

such as postulated, there is the requirement of a hearing. None was conducted. Likewise, even if We grant, for the sake of argument, that said power includes the power to disband the board of directors and remove the officers of the KBMBPM, and that a hearing was not expressly required in the law, still the Order can be validly issued only after giving due process to the affected parties, herein petitioners. Due process is guaranteed by the Constitution and extends to administrative proceedings. In the landmark 76 case of Ang Tibay vs. Court of Industrial Relations, this Court, through Justice Laurel, laid down the cardinal primary requirements of due process in administrative proceedings, foremost of which is the right to a hearing, which includes the right to present one's case and submit evidence in support thereof. The need for notice and the opportunity to be heard is the heart of procedural due process, be it in either judicial or administrative 77 proceedings. Nevertheless, a plea of a denial of procedural due process does not lie where a defect consisting in an absence of notice of hearing was thereafter cured by the aggrieved party himself as when he had the opportunity to be heard on a subsequent motion for reconsideration. This is consistent with the principle that what the law prohibits is not the absence of previous notice but the absolute absence thereof and lack 78 of an opportunity to be heard. In the instant case, there was no notice of a hearing on the alleged petition of the general membership of the KBMBPM; there was, as well, not even a semblance of a hearing. The Order was based solely on an alleged petition by the general membership of the KBMBPM. There was then a clear denial of due process. It is most unfortunate that it was done after democracy was restored through the peaceful people revolt at EDSA and the overwhelming ratification of a new Constitution thereafter, which preserves for the generations to come the gains of that historic struggle which earned for this Republic universal admiration. If there were genuine grievances against petitioners, the affected members should have timely raise these issues in the annual general assembly or in a special general assembly. Or, if such a remedy would be futile for some reason or another, judicial recourse was available. Be that as it may, petitioners cannot, however, be restored to their positions. Their terms expired in 1989, thereby rendering their prayer for reinstatement moot and academic. Pursuant to Section 13 of the by-laws, during the election at the first annual general assembly after registration, one-half plus one (4) of the directors obtaining the highest number of votes shall serve for two years, and the remaining directors (3) for one year; thereafter, all shall be elected for a term of two years. Hence, in 1988, when the board was disbanded, there was a number of directors whose terms would have expired the next year (1989) and a number whose terms would have expired two years after (1990). Reversion to the status quo preceding 29 October 1988 would not be feasible in view of this turn of events. Besides, elections 79 were held in 1990 and 1991. The affairs of the cooperative are presently being managed by a new board of directors duly elected in accordance with the cooperative's by-laws.
75

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2. G. R. No. 91927. The right of an accused to a preliminary investigation is not among the rights guaranteed him in the Bill of Rights. As stated in Marcos, et al. vs. Cruz, 80 "the preliminary investigation in criminal cases is not a creation of the Constitution; its origin is statutory and it exists and the right thereto can be invoked when so established and granted by law. It is so specifically granted by procedural law. 81 If not waived, absence thereof may amount to a denial of due process. 82 However, lack of preliminary investigation is not a ground to quash or dismiss a complaint or information. Much less does it affect the court's jurisdiction. In People vs. Casiano, 83 this Court ruled: Independently of the foregoing, the absence of such investigation [preliminary] did not impair the validity of the information or otherwise render it defective. Much less did it affect the jurisdiction of the court of first instance over the present case. Hence, had the defendant-appellee been entitled to another preliminary investigation, and had his plea of not guilty upon arraignment not implied a waiver of said right, the court of first instance should have, either conducted such preliminary investigation, or ordered the Provincial Fiscal to make it, in pursuance of section 1687 of the Revised Administrative Code (as amended by Republic Act No. 732), or remanded the record for said investigation to the justice of the peace court, instead of dismissing the case as it did in the order appealed from. This doctrine was thereafter reiterated or affirmed in several case. 84 In the instant case, even if it is to be conceded for argument's sake that there was in fact no preliminary investigation, the Sandiganbayan, per Doromal vs. Sandiganbayan, 85 "should merely suspend or hold in abeyance proceedings upon the questioned Amended Information and remand the case to the Office of the Ombudsman for him to conduct a preliminary investigation." It is Our view, however, that petitioners were not denied the right to preliminary investigation. They, nevertheless, insist that the preliminary investigation conducted by the Office of the Special Prosecutor existed more in form than in substance. This is anchored on the failure by prosecutor Onos to consider the counter-affidavits filed by petitioners. The same sin of omission is ascribed to Acting Director de la Llana who purportedly failed to consider the comments submitted by the petitioners pursuant to a subpoena dated 13 April 1989. The failure of special prosecutor Berbano to conduct a preliminary investigation before amending the information is also challenged. It is finally urged that the Sandiganbayan completely disregarded the "glaring anomaly that on its face the Information filed by the Office of the Special Prosecutor" was prepared and subscribed on 18 January 1989, while the records indicate that the preliminary investigation was concluded on 3 October 1989. In his Comment, respondent Berbano dispassionately traces the genesis of the criminal information filed before the Sandiganbayan. His assessment that a preliminary investigation sufficient in substance and manner was conducted prior to the filing of the information reflects the view of the Sandiganbayan, maintained in both the 17

November 1989 and 4 January 1990 resolutions, that there was compliance with the requirements of due process. Petitioners were provided a reasonable period within which to submit their counter-affidavits; they did not avail of the original period; they moved for an extension of at least fifteen (15) days from 22 October 1988. Despite the urgency of its nature, the motion was sent by mail. The extension prayed for was good up to 6 November 1988. But, as admitted by them, they filed the Counter-Affidavits only on 9 November 1988. Yet, they blamed prosecutor Onos for promulgating the 11 November 1989 Resolution and for, allegedly, not acting on the motion. Petitioners then should not lay the blame on Onos; they should blame themselves for presuming that the motion would be granted. This notwithstanding, petitioners were able to file a Motion for Reconsideration on 13 December 1988 requesting that the reviewing prosecutor consider the belatedly filed documents; 86 thus, there is the recommendation of prosecutor Bernardita Erum calling for the dismissal of the charges on 2 March 1989, which, however, was not sustained upon subsequent review. The Sandiganbayan, in its 17 November 1989 Resolution, succinctly summed up the matter when it asserted that "even granting, for the sake of argument, that prosecutor Onos . . . failed to consider accused-movants' counter-affidavits, such defect was cured when a "Motion for Reconsideration" was filed, and which . . . de la Llana took into account upon review." It may not then be successfully asserted that the counteraffidavits were not considered by the Ombudsman in approving the information. Perusal of the factual antecedents reveals that a second investigation was conducted upon the "1st Indorsement" of the Ombudsman of 4 April 1989. As a result, subpoenas were issued and comments were asked to be submitted, which petitioners did, but only after a further extension of fifteen (15) days from the expiration of the original deadline. From this submission the matter underwent further review. Moreover, in the 18 January 1989 Order of prosecutor Onos, there was an ample discussion of the defenses raised by the petitioners in their counter-affidavits, thus negating the charge that the issues raised by them were not considered at all. 87 It is indisputable that the respondents were not remiss in their duty to afford the petitioners the opportunity to contest the charges thrown their way. Due process does not require that the accused actually file his counteraffidavits before the preliminary investigation is deemed completed. All that is required is that he be given the opportunity to submit such if he is so minded. 88 In any event, petitioners did in fact, although belatedly, submit their counter-affidavits and as a result thereof, the prosecutors concerned considered them in subsequent reviews of the information, particularly in the reinvestigation ordered by the Ombudsman. And now, as to the protestation of lack of preliminary investigation prior to the filing of the Amended Information. The prosecution may amend the information without leave of court before arraignment, 89 and such does not 90 prejudice the accused. Reliance on the 91 pronouncements in Doromal vs. Sandiganbayan is

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misplaced as what obtained therein was the preparation of an entirely new information as contrasted with mere amendments introduced in the amended information, which also charges petitioners with violating Section 3 (e) of the Anti-Graft Law. In Gaspar vs. Sandiganbayan, We held that there is no rule or law requiring the Tanodbayan to conduct another preliminary investigation of a case under review by it. On the contrary, under P.D. No. 911, in relation to Rule 12, Administrative Order No. VII, the Tanodbayan may, upon review, reverse the findings of the investigator and thereafter "where he finds a prima facie case, to cause the filing of an information in court against the respondent, based on the same sworn statements or evidence submitted, without the necessity of conducting another preliminary investigation." Respondent Sandiganbayan did not then commit any grave abuse of discretion in respect to its Resolutions of 4 January 1990 and 1 February 1990. The petition then must fail. CONCLUSION WHEREFORE, judgment is hereby rendered: 1. GRANTING the petition in G.R. No. 85439; declaring null and void the challenged Order of 28 October 1988 of the respondent Secretary of Agriculture; but denying, for having become moot and academic, the prayer of petitioners that they be restored to their positions in the KBMBPM. 2. DISMISSING, for lack of merit, the petition in G.R. No. 91927. No pronouncement as to costs. IT IS SO ORDERED.
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The antecedent facts: Based on examination reports submitted by the Supervision and Examination Sector (SES), Department II, of the Central Bank (CB) "that the financial condition of TSB is one of insolvency and its continuance in business would involve probable loss to its 3 depositors and creditors," the Monetary Board (MB) issued on 31 May 1985 Resolution No. 596 ordering the closure of TSB, forbidding it from doing business in the Philippines, placing it under receivership, and appointing Ramon V. Tiaoqui as receiver. Tiaoqui assumed office on 4 3 June 1985. On 11 June 1985, TSB filed a complaint with the Regional Trial Court of Quezon City, docketed as Civil Case No. Q45139, against Central Bank and Ramon V. Tiaoqui to annul MB Resolution No. 596, with prayer for injunction, challenging in the process the constitutionality of Sec. 29 of R.A. 269, otherwise known as "The Central Bank Act," as amended, insofar as it authorizes the Central Bank to take over a banking institution even if it is not charged with violation of any law or regulation, much less found guilty 5 thereof. On 1 July 1985, the trial court temporarily restrained petitioners from implementing MB Resolution No. 596 "until further orders", thus prompting them to move for the quashal of the restraining order (TRO) on the ground that it did not comply with said Sec. 29, i.e., that TSB failed to show convincing proof of arbitrariness and bad faith on the part of petitioners;' and, that TSB failed to post the requisite bond in favor of Central Bank. On 19 July 1985, acting on the motion to quash the restraining order, the trial court granted the relief sought and denied the application of TSB for injunction. Thereafter, Triumph Savings Bank filed with Us a petition 6 for certiorari under Rule 65 of the Rules of Court dated 25 July 1985 seeking to enjoin the continued implementation of the questioned MB resolution. Meanwhile, on 9 August 1985; Central Bank and Ramon Tiaoqui filed a motion to dismiss the complaint before the RTC for failure to state a cause of action, i.e., it did not allege ultimate facts showing that the action was plainly arbitrary and made in bad faith, which are the only grounds for the annulment of Monetary Board resolutions placing a bank under conservatorship, and that TSB was 7 without legal capacity to sue except through its receiver. On 9 September 1985, TSB filed an urgent motion in the RTC to direct receiver Ramon V. Tiaoqui to restore TSB to its private management. On 11 November 1985, the RTC in separate orders denied petitioners' motion to dismiss and ordered receiver Tiaoqui to restore the management of TSB to its elected board of directors and officers, subject to CB comptrollership. Since the orders of the trial court rendered moot the petition for certiorari then pending before this Court, Central Bank and Tiaoqui moved on 2 December 1985 for the dismissal of G.R. No. 71465 which We granted on 18 8 December 1985. Instead of proceeding to trial, petitioners elevated the twin orders of the RTC to the Court of Appeals on a petition for 9 certiorari and prohibition under Rule 65. On 26 September 1986, the appellate court, upheld the orders of the trial court thus

G.R. No. 76118 March 30, 1993 THE CENTRAL BANK OF THE PHILIPPINES and RAMON V. TIAOQUI, petitioners, vs. COURT OF APPEALS and TRIUMPH SAVINGS BANK, respondents. Sycip, Salazar, Hernandez & Gatmaitan for petitioners. Quisumbing, Torres & Evangelista for Triumph Savings Bank.

BELLOSILLO, J.: May a Monetary Board resolution placing a private bank under receivership be annulled on the ground of lack of prior notice and hearing? This petition seeks review of the decision of the Court of Appeals in CA G.R. S.P. No. 07867 entitled "The Central Bank of the Philippines and Ramon V. Tiaoqui vs. Hon. Jose C. de Guzman and Triumph Savings Bank," promulgated 26 September 1986, which affirmed the twin orders of the Regional Trial Court of Quezon City issued 1 11 November 1985 denying herein petitioners' motion to dismiss Civil Case No. Q-45139, and directing petitioner Ramon V. Tiaoqui to restore the private management of Triumph Savings Bank (TSB) to its elected board of directors and officers, subject to Central Bank 2 comptrollership.

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Petitioners' motion to dismiss was premised on two grounds, namely, that the complaint failed to state a cause of action and that the Triumph Savings Bank was without capacity to sue except through its appointed receiver. Concerning the first ground, petitioners themselves admit that the Monetary Board resolution placing the Triumph Savings Bank under the receivership of the officials of the Central Bank was done without prior hearing, that is, without first hearing the side of the bank. They further admit that said resolution can be the subject of judicial review and may be set aside should it be found that the same was issued with arbitrariness and in bad faith. The charge of lack of due process in the complaint may be taken as constitutive of allegations of arbitrariness and bad faith. This is not of course to be taken as meaning that there must be previous hearing before the Monetary Board may exercise its powers under Section 29 of its Charter. Rather, judicial review of such action not being foreclosed, it would be best should private respondent be given the chance to show and prove arbitrariness and bad faith in the issuance of the questioned resolution, especially so in the light of the statement of private respondent that neither the bank itself nor its officials were even informed of any charge of violating banking laws. In regard to lack of capacity to sue on the part of Triumph Savings Bank, we view such argument as being specious, for if we get the drift of petitioners' argument, they mean to convey the impression that only the CB appointed receiver himself may question the CB resolution appointing him as such. This may be asking for the impossible, for it cannot be expected that the master, the CB, will allow the receiver it has appointed to question that very appointment. Should the argument of petitioners be given circulation, then judicial review of actions of the CB would be effectively checked and foreclosed to the very bank officials who may feel, as in the case at bar, that the CB action ousting them from the bank deserves to be set aside. xxx xxx xxx On the questioned restoration order, this Court must say that it finds nothing whimsical, despotic, capricious, or arbitrary in its issuance, said action only being in line and congruent to the action of the Supreme Court in the Banco Filipino Case (G.R. No. 70054) where management of the bank was restored to its duly elected directors and 10 officers, but subject to the Central Bank comptrollership. On 15 October 1986, Central Bank and its appointed receiver, Ramon V. Tiaoqui, filed this petition under Rule 45 of the Rules of Court praying that the decision of the Court of Appeals in CA-G.R. SP No. 07867 be set aside, and that the civil case pending before the RTC of Quezon City, Civil Case No. Q-45139, be dismissed. Petitioners allege that the Court of Appeals erred (1) in affirming that an insolvent bank that had been summarily closed by the Monetary Board should be restored to its private management supposedly because such summary closure was "arbitrary and in bad faith" and a denial of "due process"; (2) in holding that the "charge of lack of due process" for "want of prior hearing" in a complaint to annul a Monetary Board receivership resolution under Sec. 29 of R.A. 265

"may be taken as . . allegations of arbitrariness and bad faith"; and (3) in holding that the owners and former officers of an insolvent bank may still act or sue in the name and corporate capacity of such bank, even after it had been 11 ordered closed and placed under receivership. The respondents, on the other hand, allege inter alia that 12 in the Banco Filipino case, We held that CB violated the rule on administrative due process laid down in Ang Tibay vs. CIR (69 Phil. 635) and Eastern Telecom Corp. vs. Dans, Jr. (137 SCRA 628) which requires that prior notice and hearing be afforded to all parties in administrative proceedings. Since MB Resolution No. 596 was adopted without TSB being previously notified and heard, according to respondents, the same is void for want of due process; consequently, the bank's management 13 should be restored to its board of directors and officers. Petitioners claim that it is the essence of Sec. 29 of R.A. 265 that prior notice and hearing in cases involving bank closures should not be required since in all probability a hearing would not only cause unnecessary delay but also provide bank "insiders" and stockholders the opportunity to further dissipate the bank's resources, create liabilities for the bank up to the insured amount of P40,000.00, and even destroy evidence of fraud or irregularity in the bank's operations to the prejudice of its depositors and creditors. 14 Petitioners further argue that the legislative intent of Sec. 29 is to repose in the Monetary Board exclusive power to determine the existence of statutory grounds for the closure and liquidation of banks, having the required expertise and specialized competence to do so. The first issue raised before Us is whether absence of prior notice and hearing may be considered acts of arbitrariness and bad faith sufficient to annul a Monetary Board resolution enjoining a bank from doing business and placing it under receivership. Otherwise stated, is absence of prior notice and hearing constitutive of acts of arbitrariness and bad faith? Under Sec. 29 of R.A. 265, the Central Bank, through the Monetary Board, is vested with exclusive authority to assess, evaluate and determine the condition of any bank, and finding such condition to be one of insolvency, or that its continuance in business would involve probable loss to its depositors or creditors, forbid the bank or non-bank financial institution to do business in the Philippines; and shall designate an official of the CB or other competent person as receiver to immediately take charge of its 16 assets and liabilities. The fourth paragraph, which was then in effect at the time the action was commenced, allows the filing of a case to set aside the actions of the Monetary Board which are tainted with arbitrariness and bad faith. Contrary to the notion of private respondent, Sec. 29 does not contemplate prior notice and hearing before a bank may be directed to stop operations and placed under receivership. When par. 4 (now par. 5, as amended by E.O. 289) provides for the filing of a case within ten (10) days after the receiver takes charge of the assets of the bank, it is unmistakable that the assailed actions should precede the filing of the case. Plainly, the legislature could not have intended to authorize "no prior notice and hearing" in the closure of the bank and at the same time allow a suit to annul it on the basis of absence thereof.
15

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In the early case of Rural Bank of Lucena, Inc. v. Arca 17 [1965], We held that a previous hearing is nowhere required in Sec. 29 nor does the constitutional requirement of due process demand that the correctness of the Monetary Board's resolution to stop operation and proceed to liquidation be first adjudged before making the resolution effective. It is enough that a subsequent judicial review be provided. Even in Banco Filipino, We reiterated that Sec. 29 of R.A. 265 does not require a previous hearing before the Monetary Board can implement its resolution closing a bank, since its action is subject to judicial scrutiny as provided by law. It may be emphasized that Sec. 29 does not altogether divest a bank or a non-bank financial institution placed under receivership of the opportunity to be heard and present evidence on arbitrariness and bad faith because within ten (10) days from the date the receiver takes charge of the assets of the bank, resort to judicial review may be had by filing an appropriate pleading with the court. Respondent TSB did in fact avail of this remedy by filing a complaint with the RTC of Quezon City on the 8th day following the takeover by the receiver of the bank's assets on 3 June 1985. This "close now and hear later" scheme is grounded on practical and legal considerations to prevent unwarranted dissipation of the bank's assets and as a valid exercise of police power to protect the depositors, creditors, stockholders and the general public. In Rural Bank of Buhi, Inc. v. Court of Appeals, stated that
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money, banking and credit; corollarily, it shall have supervision over the operations of banks (Sec. 14, Art. XV, 1973 Constitution, and Sec. 20, Art. XII, 1987 Constitution). Under its charter, the CB is further authorized to take the necessary steps against any banking institution if its continued operation would cause prejudice to its depositors, creditors and the general public as well. This power has been expressly recognized by this Court. In Philippine Veterans Bank Employees UnionNUBE v. Philippine Veterans Banks (189 SCRA 14 [1990], this Court held that: . . . [u]nless adequate and determined efforts are taken by the government against distressed and mismanaged banks, public faith in the banking system is certain to deteriorate to the prejudice of the national economy itself, not to mention the losses suffered by the bank depositors, creditors, and stockholders, who all deserve the protection of the government. The government cannot simply cross its arms while the assets of a bank are being depleted through mismanagement or irregularities. It is the duty of the Central Bank in such an event to step in and salvage the remaining resources of the bank so that they may not continue to be dissipated or plundered by those entrusted with their management. Section 29 of R.A. 265 should be viewed in this light; otherwise, We would be subscribing to a situation where the procedural rights invoked by private respondent would take precedence over the substantive interests of depositors, creditors and stockholders over the assets of the bank. Admittedly, the mere filing of a case for receivership by the Central Bank can trigger a bank run and drain its assets in days or even hours leading to insolvency even if the bank be actually solvent. The procedure prescribed in Sec. 29 is truly designed to protect the interest of all concerned, i.e., the depositors, creditors and stockholders, the bank itself, and the general public, and the summary closure pales in comparison to the protection afforded public interest. At any rate, the bank is given full opportunity to prove arbitrariness and bad faith in placing the bank under receivership, in which event, the resolution may be properly nullified and the receivership lifted as the trial court may determine. The heavy reliance of respondents on the Banco Filipino case is misplaced in view of factual circumstances therein which are not attendant in the present case. We ruled in Banco Filipino that the closure of the bank was arbitrary and attendant with grave abuse of discretion, not because of the absence of prior notice and hearing, but that the Monetary Board had no sufficient basis to arrive at a sound conclusion of insolvency to justify the closure. In other words, the arbitrariness, bad faith and abuse of discretion were determined only after the bank was placed under conservatorship and evidence thereon was received by the trial court. As this Court found in that case, the Valenzuela, Aurellano and Tiaoqui Reports contained unfounded assumptions and deductions which did not reflect the true financial condition of the bank. For instance, the subtraction of an uncertain amount as valuation reserve from the assets of the bank would merely result in its net worth or the unimpaired capital and surplus; it did not reflect the total financial condition of Banco Filipino.

We

. . . due process does not necessarily require a prior hearing; a hearing or an opportunity to be heard may be subsequent to the closure. One can just imagine the dire consequences of a prior hearing: bank runs would be the order of the day, resulting in panic and hysteria. In the process, fortunes may be wiped out and disillusionment will run the gamut of the entire banking community. We stressed in Central Bank of the Philippines v. Court of 20 Appeals that . . . the banking business is properly subject to reasonable regulation under the police power of the state because of its nature and relation to the fiscal affairs of the people and the revenues of the state (9 CJS 32). Banks are affected with public interest because they receive funds from the general public in the form of deposits. Due to the nature of their transactions and functions, a fiduciary relationship is created between the banking institutions and their depositors. Therefore, banks are under the obligation to treat with meticulous care and utmost fidelity the accounts of those who have reposed their trust and confidence in them (Simex International [Manila], Inc., v. Court of Appeals, 183 SCRA 360 [1990]). It is then the Government's responsibility to see to it that the financial interests of those who deal with the banks and banking institutions, as depositors or otherwise, are protected. In this country, that task is delegated to the Central Bank which, pursuant to its Charter (R.A. 265, as amended), is authorized to administer the monetary, banking and credit system of the Philippines. Under both the 1973 and 1987 Constitutions, the Central Bank is tasked with providing policy direction in the areas of

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Furthermore, the same reports showed that the total assets of Banco Filipino far exceeded its total liabilities. Consequently, on the basis thereof, the Monetary Board had no valid reason to liquidate the bank; perhaps it could have merely ordered its reorganization or rehabilitation, if need be. Clearly, there was in that case a manifest arbitrariness, abuse of discretion and bad faith in the closure of Banco Filipino by the Monetary Board. But, this is not the case before Us. For here, what is being raised as arbitrary by private respondent is the denial of prior notice and hearing by the Monetary Board, a matter long settled in this jurisdiction, and not the arbitrariness which the conclusions of the Supervision and Examination Sector (SES), Department II, of the Central Bank were reached. Once again We refer to Rural Bank of Buhi, Inc. v. Court 21 of Appeals, and reiterate Our pronouncement therein that . . . the law is explicit as to the conditions prerequisite to the action of the Monetary Board to forbid the institution to do business in the Philippines and to appoint a receiver to immediately take charge of the bank's assets and liabilities. They are: (a) an examination made by the examining department of the Central Bank; (b) report by said department to the Monetary Board; and (c) prima facie showing that its continuance in business would involve probable loss to its depositors or creditors. In sum, appeal to procedural due process cannot just outweigh the evil sought to be prevented; hence, We rule that Sec. 29 of R.A. 265 is a sound legislation promulgated in accordance with the Constitution in the exercise of police power of the state. Consequently, the absence of notice and hearing is not a valid ground to annul a Monetary Board resolution placing a bank under receivership. The absence of prior notice and hearing cannot be deemed acts of arbitrariness and bad faith. Thus, an MB resolution placing a bank under receivership, or conservatorship for that matter, may only be annulled after a determination has been made by the trial court that its issuance was tainted with arbitrariness and bad faith. Until such determination is made, the status quo shall be maintained, i.e., the bank shall continue to be under receivership. As regards the second ground, to rule that only the receiver may bring suit in behalf of the bank is, to echo the respondent appellate court, "asking for the impossible, for it cannot be expected that the master, the CB, will allow the receiver it has appointed to question that very appointment." Consequently, only stockholders of a bank could file an action for annulment of a Monetary Board resolution placing the bank under receivership and 22 prohibiting it from continuing operations. In Central Bank 23 v. Court of Appeals, We explained the purpose of the law . . . in requiring that only the stockholders of record representing the majority of the capital stock may bring the action to set aside a resolution to place a bank under conservatorship is to ensure that it be not frustrated or defeated by the incumbent Board of Directors or officers who may immediately resort to court action to prevent its implementation or enforcement. It is presumed that such a resolution is directed principally against acts of said Directors and officers which place the bank in a state of

continuing inability to maintain a condition of liquidity adequate to protect the interest of depositors and creditors. Indirectly, it is likewise intended to protect and safeguard the rights and interests of the stockholders. Common sense and public policy dictate then that the authority to decide on whether to contest the resolution should be lodged with the stockholders owning a majority of the shares for they are expected to be more objective in determining whether the resolution is plainly arbitrary and issued in bad faith. It is observed that the complaint in this case was filed on 11 June 1985 or two (2) years prior to 25 July 1987 when E.O. 289 was issued, to be effective sixty (60) days after its approval (Sec. 5). The implication is that before E.O . 289, any party in interest could institute court proceedings to question a Monetary Board resolution placing a bank under receivership. Consequently, since the instant complaint was filed by parties representing themselves to be officers of respondent Bank (Officer-inCharge and Vice President), the case before the trial court should now take its natural course. However, after the effectivity of E.O. 289, the procedure stated therein should be followed and observed. PREMISES considered, the Decision of the Court of Appeals in CA-G.R. SP No. 07867 is AFFIRMED, except insofar as it upholds the Order of the trial court of 11 November 1985 directing petitioner RAMON V. TIAOQUI to restore the management of TRIUMPH SAVINGS BANK to its elected Board of Directors and Officers, which is hereby SET ASIDE. Let this case be remanded to the Regional Trial Court of Quezon City for further proceedings to determine whether the issuance of Resolution No. 596 of the Monetary Board was tainted with arbitrariness and bad faith and to decide the case accordingly. SO ORDERED.

G.R. No. 107845 April 18, 1997 PAT. EDGAR M. GO, INP., petitioner, vs. NATIONAL POLICE COMMISSION, respondent.

MENDOZA, J.: Petitioner Edgar M. Go had been a member of the Olongapo City Police Department since April 18, 1974. On December 16, 1983, he was dismissed for alleged involvement in illegal gambling, more particularly the 1 operation of jai-alai bookies. The decision, dated November 24, 1983, of the Summary Dismissal Board No. 2 of the PC/INP Regional Command No. 3 at Camp Olivas, San Fernando, Pampanga, stated: Investigation reveals that on 21 January 1983 at about 9:00 o'clock in the evening, a team of military personnel raided the house of the respondent at No. 28 Murphy St., Pag-asa, Olongapo City. The raiding team were able to apprehend fifteen (15) persons inside the house of PAT. EDGAR GO to include his wife, Minda Go. Lieutenant Paterno Ding PC, the leader of the raiding team was able to confiscate the amount of One Thousand (P1,000.00)

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Pesos, assorted papelitos, ballpen an calculator used in the operation of Jai Alai Bookies. In stigation further reveals that another raid was conducted for the second time at the house of PAT. EDGAR GO. Major Jaime Garcia, Deputy Commander of Olongapo Metrodiscom Command in his written report to the Olongapo Metrodiscom Commander stated that on 16 June 1983 PAT. EDGAR GO, together with his brother, Lolito Go were both involved in Jai Alai Bookies which were being committed right at the house of the respondent. Witnesses like Rodolfo Ablaza and Rolando dela Fuente admitted that they were the collector of PAT. EDGAR GO and Lolito Go in the operation of Jai Alai Bookies. It was further discovered during the investigation of the case that the first raid conducted on 21 January 1983, a criminal complaint was filed before the City Court of Olongapo City against the wife and brother of the respondent respectively. But PAT. EDGAR GO approached the Metropolitan Commander for a favor to dismiss the case against his wife and brother with the promise that the Jai Alai activities committed in his residence will be stop once and for all. The Fiscal later on dismissed the case for insufficiency of evidence for failure on the part of the raiding team to prosecute the case. Moreover, when the second raid was conducted it was proven that illegal Jai Alai activities was still going on in the residence of the respondent. On the other hand, respondent inspite of several notices failed to appear before the board in order to refute the charges against him. The board in its desire to base the instant case with impartiality, objectivity and legality has to postpone the hearing of the case for several times, just to allow the respondent and his witnesses to appear before the Board, but all our efforts proved futile with the refusal of the respondent to appear before the Board in spite of all notices duly served to him by the [illegible] Metropolitan District Command. So, after four (4) months of several postponements, the Board proceeded with the hiring and considered the non-appearance of the respondent as a waiver on his part to present his evidence. The Board after receiving both the written and oral evidences/testimonies, has concluded that it would be inconceivable for an ordinary man to believe that Pat. Edgar Go, a policeman at that, would not be able to know what is going on inside his own residence, as a matter of fact, he made a promise to the Olongapo Metrodiscom Commander that such illegal activities will never happened again and yet same was proven to be existing when the second raid was conducted. While it is true that on 16 June 1983 and 21 January 1983 complainant was in his official assignment, it was clearly established that PAT. EDGAR GO has the full knowledge on the existence of the illegal Jai Alai activities and even those apprehended during the first and the second raid implicated the respondent.. PD 1707 in relation to Memorandum agreement between NAPOLCOM and Director General, INP dated November 24, 1980 provides that a syndicate crime and tong collection are serious offenses against an INP members and is therefore within the jurisdiction of the dismissal authorities.

Petitioner was informed of his dismissal in a memo, dated December 20, 1983, by I. Col. Ferdinand A. Lagman, District Superintendent, INP of the Olongapo; Metropolitan 2 District Command. He appealed to the Director General of the PC/INP, complaining of denial of due process. He claimed that no copy of the complaint with supporting affidavits had been served on him as required by NAPOLCOM Resolution No. 81-01; that he was simply ordered by radio to appear before the summary dismissal board for investigation; that he went to attend the hearing on May 9, 1983 but neither the complainant nor his witnesses were present and he was advised by the board's chairman, a certain Colonel Cinco, to secure the services of a lawyer for the next hearing; that at the hearing on September 6 or 9, 1983, the members of the board and complainant and his witnesses were gain absent; that the third hearing scheduled on September 21, 1983 was also postponed because of the absence of the members of the board; that although a hearing had allegedly been held on October 19, 1983, he was not able to attend it because he had not been previously notified; that he heard nothing more about the case until he was informed of the decision dismissing him, a copy of which was received by him only on February 20, 1984. Petitioner claimed that had he been allowed to crossexamine the witnesses against him, he could have shown that Rodolfo Ablaza and Rolando de la Fuente; who, according to the board's decision said they had worked as jai-alai collectors of petitioner and his brother, subsequently executed affidavits in which they said they had been misled into signing their prior statements. Finally, petitioner argued that, in any event, his dismissal should have taken effect only upon his receipt of a copy of the decision on February 20, 1984 and not on December 16, 1983. He cited his 11 years of service in the police department and various awards and commendations which and been given to him and prayed that he be exonerated and reinstated to the police department and paid back salaries, from the time of his dismissal to the time of his reinstatement, and other reliefs to which he might he entitled. Petitioner's appeal was denied as the Director General of the PC/INP noted in a decision, dated August 21, 1990, that "there appears a factual basis which is legally unassailable" for the summary dismissal board's findings.
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Petitioner appealed to the National Police Commission which likewise dismissed his appeal for "utter lack of 4 merit." In its decision, dated March 5, 1992, the NAPOLCOM held: The fact that the Jai alai bookies were operating in the house being occupied by herein respondent-appellant, the apprehension of his wife and brother in two (2) successive raids effected by law-enforcement authority and his intercession for the dismissal of the case filed in consequence thereof, are tangible proofs that he was, indeed, an accessory if not a principal in said gambling operation. As to the assertion of respondent-appellant that he was deprived of his right to due process, anchored on the allegation that he was not served and notice of hearing, it is belied by the records. On several occasions, the Summary Dismissal Board sent notices to herein

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respondent-appellant requiring him to appear and present evidence in his behalf, but he ignored said notices, prompting the Board to proceed with the investigation ex parte. Hence, this petition for certiorari to set aside the decision of the NAPOLCOM. Petitioner maintains that he was not served written charges and informed of the nature of such charges; that no hearing had actually been held by the summary dismissal board; and that at any rate he was not heard. We find petitioner's claim meritorious. Petitioner's case was decided under P.D. No. 971, as amended by P.D. No. 1707. While 8-A of the Decree authorizes summary dismissals "without the necessity of a formal investigation" of members of the INP "when the charge is serious and the evidence is strong," the Decree and the implementing rules nonetheless give the respondent the right to be furnished a copy of the complaint and to file an answer within three (3) days. This right consists of the following: (1) The Hearing Officer or INP Director concerned shall furnish the respondent a copy of the complaint with all the sworn statements and other documents attached thereto with a notification that on the scheduled date of hearing, the respondent must submit sworn counter-statements and/or other evidence to disprove the charge, otherwise, the former shall forthwith recommend his summary 6 removal based on the evidence on hand. (2) Notification of Charges or Complaint; Order to Answer. The respondent INP member shall be furnished with a copy of the complaint or charges against him and he shall answer said complaint within three (3) days from receipt thereof, enclosing therewith pertinent supporting documents or evidences in his behalf. If the respondent fails to answer the charges within the prescribed period, the Summary Dismissal Authority shall immediately 7 conduct the investigation ex parte. The filing of charges and the allowance of reasonable opportunity to respondent to answer the charges constitute the minimum requirements of due process. Thus, in Government Service and Insurance System v. Court of 8 Appeals, 40 of P.D. No. 807, which similarly authorized the summary dismissals of civil service employees without formal investigation "when the charge is serious and the evidence of guilt is strong," was construed by this Court to require the giving of notice of charges to a respondent and the right to answer. We said: We think it is time this Court firms up its position on the validity of Section 40 of the Civil Service Act. It is clear to us that what the opening sentence of Section 40 is saying is that an employee may be removed or dismissed even without formal investigation, in certain instances. It is equally clear to us that an employee must be informed of the charges preferred [sic] against him, and that the normal way by which the employee is so informed is by furnishing him with a copy of the charges made against him. This is a basic procedural requirement that a statute cannot dispense with and still remains consistent with the constitutional provision on due process. The second minimum requirement is that the employee charged with some misfeasance or malfeasance must have a reasonable opportunity to present his side of the matter, that is to say, his defenses against the charges levelled
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again him and to present evidence in support of his defenses. The ordinary way by which a Civil Service employee is given this opportunity is by holding an investigation, in the course of which the employee may assert his defenses and present his supporting evidence. If Section 40 of the Civil Service Decree is to be saved from unconstitutionality, it cannot be interpreted or applied in such a manner as to deprive a respondent employee of these two (2) minimum rights. These are not the only indispensable requirements of procedural due process; they are, however, most directly involved in the matter of whether or not an investigation of charges against a civil 9 service employee is essential. The INP record of this case does not show that a formal complaint was ever filed against petitioner. Nor are there attached to such record supporting affidavits of witnesses, if any, against him. Neither the decision of the board, nor that of the Director General of the PC/INP denying reconsideration, nor the decision of the NAPOLCOM on appeal contains reference to any written complaint with supporting affidavits filed against petitioner. Petitioner's complaint that he had not been furnished written charges with supporting affidavits merited no more than a passing mention in the decision of the PC/INP Director General. In his appeal to the NAPOLCOM, petitioner reiterated his claim, but the decision of this agency, dismissing his appeal, merely rehashed the decision of the Director General. There was no effort made to deal with the assignment of errors of petitioner. Indeed, that the summary dismissal board appears to have done in this case was simply to receive the report on two raids allegedly conducted on petitioner's house on January 21, 1983 and on June 16, 1983, in the course of which what were believed were gambling paraphernalia (money in the amount of P1,000.00, assorted "papelitos," a ballpen, and a calculator) were allegedly found and two witnesses (Rodolfo Ablaza and Rolando de la Fuente) allegedly admitted they were collectors of petitioner and his brother Lolito Go. But the report, if it was ever in writing, is not in the record of this case which the NAPOLCOM transmitted to the Court. Nor does the decision of the summary dismissal board disclose on what the supposed report was based. This is in violation of the rule that in administrative proceedings "the decision must be rendered on the evidence contained in the record and 10 disclosed to the party affected." In all probability the report of the team which conducted the raids was not even in writing and the supposed testimonies of the two witnesses were not taken down. This is evident from the decision of the board which, instead of referring to the testimonies or affidavits of witnesses, repeatedly refers to the results of an "investigation." Thus, the decision states: "Investigation reveals . . . ," "investigation further reveals . . . .," "It was further discovered during the investigation . . . ." It is clear that the facts found by the board were not the result of any investigation conducted by it but by some other group, possibly the team that allegedly conducted the raids and that what the board did was simply to rely on their finding. Under these circumstances there was no way by which petitioner could defend himself. In summary dismissal proceedings, unless other fully effective means for implementing the constitutional requirement of notice and

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hearing are devised, it is mandatory that charges be specified in writing and that the affidavits in support thereof be attached to the complaint because these are the only ways by which evidence against the respondent can be brought to his knowledge. They take the place of direct examination of witnesses. The formal investigation, which is dispensed with in summary dismissal proceedings, refers to the presentation of witnesses by their direct examination and not to the requirement that the respondent in the administrative case be notified of the charges and given the chance to defend himself. The Solicitor General argues that petitioner could not have failed to inquire what the charges against him were because he admits he appeared before the board as ordered. That may be so. Petitioner might have been told what the charge or charges against him were, but not the details thereof, and, certainly, not what the alleged witnesses against him might have said because, as already stated, the record of the INP simply did not contain their alleged testimonies. Nor does it appear that petitioner was heard in his defense. His claim, that thrice he appeared before the summary dismissal board but no hearing was ever held either because complainant and his witnesses did not appear or the members of the board were absent or both complainant and witnesses and members of the board were absent, was never specifically denied in any of the decisions of the administrative authorities, beyond saying that the claim was belied by the record. There is simply nothing in the INP record of the case to show this. It may be argued that the requirements of due process are satisfied if a party initially denied a hearing is subsequently granted one by means of motion for 11 reconsideration. That is true indeed if the charges and the evidence against him are set forth in the record of the case, but not where, as here, they are not. If in his appeal to the PC/INP Director General, petitioner presented the affidavits of retraction of two of the witnesses against him, it was only because the decision of the board mentioned that these witnesses allegedly said they had acted as petitioner's collectors and not because their prior statements were in the record. We conclude that petitioner was denied the due process of law and that not even the fact that the charge against him is serious and evidence of his guilt is in the opinion of his superiors strong can compensate for the procedural shortcut evident in the record of this case. It is precisely in cases such as this that the utmost care be exercised lest in the drive to clean up the ranks of the police those who are innocent are denied justice or, through blunder, those who are guilty are allowed to escape punishment. WHEREFORE, the decision of the National Police Commission is ANNULLED and petitioner is ordered REINSTATED with backwages for five (5) years and paid other benefits and RESTORED in his seniority. SO ORDERED.

HONORABLE OMBUDSMAN CONRADO VASQUEZ, HONORABLE ARTURO C. MOJICA, DEPUTY OMBUDSMAN FOR THE VISAYAS, and HONORABLE FRANKLIN DRILON, SECRETARY OF JUSTICE, and UNDERSECRETARY OF JUSTICE RAMON J. LIWAG, respondents.

MENDOZA, J.: This case requires us to determine the extent to which the Ombudsman may call upon government prosecutors for assistance in the investigation and prosecution of criminal cases cognizable by his office and the conditions under which he may do so. Petitioner Gloria G. Lastimosa is First Assistant Provincial Prosecutor of Cebu. Because she and the Provincial Prosecutor refused, or at any rate failed, to file a criminal charge as ordered by the Ombudsman, an administrative complaint for grave misconduct, insubordination, gross neglect of duty and maliciously refraining from prosecuting crime was filed against her and the Provincial Prosecutor and a charge for indirect contempt was brought against them, both in the Office of the Ombudsman. In the meantime the two were placed under preventive suspension. This is a petition for certiorari and prohibition filed by petitioner to set aside the orders of the Ombudsman with respect to the two proceedings. The background of this case is as follows: On February 18, 1993 Jessica Villacarlos Dayon, public health nurse of Santa Fe, Cebu, filed a criminal complaint for frustrated rape and an administrative complaint for immoral acts, abuse of authority and grave misconduct against the Municipal Mayor of Santa Fe, Rogelio 1 Ilustrisimo. The cases were filed with the Office of the Ombudsman-Visayas where they were docketed as OMBVIS-(CRIM)-93-0140 and OMB-VIS-(ADM)-93-0036, respectively. The complaint was assigned to a graft investigation officer who, after an investigation, found no prima facie evidence and accordingly recommended the dismissal of the complaint. After reviewing the matter, however, the Ombudsman, Hon. Conrado Vasquez, disapproved the recommendation and instead directed that Mayor Ilustrisimo be charged with attempted rape in the Regional 2 Trial Court. Accordingly, in a letter dated May 17, 1994, the Deputy Ombudsman for Visayas, respondent Arturo C. Mojica, referred the case to Cebu Provincial Prosecutor Oliveros E. Kintanar for the "filing of appropriate information with 3 the Regional Trial Court of Danao City, . . ." The case was eventually assigned to herein petitioner, First Assistant Provincial Prosecutor Gloria G. Lastimosa. It appears that petitioner conducted a preliminary investigation on the basis of which she found that only 4 acts of lasciviousness had been committed. With the approval of Provincial Prosecutor Kintanar, she filed on July 4, 1994 an information for acts of lasciviousness against Mayor Ilustrisimo with the Municipal Circuit Trial 5 Court of Santa Fe. In two letters written to the Provincial Prosecutor on July 11, 1994 and July 22, 1994, Deputy Ombudsman Mojica inquired as to any action taken on the previous referral of the case, more specifically the directive of the

G.R. No. 116801 April 6, 1995 GLORIA G. LASTIMOSA, First Assistant Provincial Prosecutor of Cebu, petitioner, vs.

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Ombudsman to charge Mayor Ilustrisimo with attempted 6 rape. As no case for attempted rape had been filed by the Prosecutor's Office, Deputy Ombudsman Mojica ordered on July 27, 1994 Provincial Prosecutor Kintanar and petitioner Lastimosa to show cause why they should not be punished for contempt for "refusing and failing to obey 7 the lawful directives" of the Office of the Ombudsman. For this purpose a hearing was set on August 1, 1994. Petitioner and the Provincial Prosecutor were given until 8 August 3, 1994 within which to submit their answer. An 9 answer was timely filed by them and hearings were thereupon conducted. It appears that earlier, on July 22, 1994, two cases had been filed against the two prosecutors with the Office of the Ombudsman for Visayas by Julian Menchavez, a resident of Santa Fe, Cebu. One was an administrative complaint for violation of Republic Act No. 6713 and P.D. 10 No. 807 (the Civil Service Law) and another one was a criminal complaint for violation of 3(e) of Republic Act 11 No. 3019 and Art. 208 of the Revised Penal Code. The complaints were based on the alleged refusal of petitioner and Kintanar to obey the orders of the Ombudsman to charge Mayor Ilustrisimo with attempted rape. In the administrative case (OMB-VIS-(ADM)-94-0189) respondent Deputy Ombudsman for Visayas Mojica issued an order on August 15, 1994, placing petitioner Gloria G. Lastimosa and Provincial Prosecutor Oliveros E. Kintanar under preventive suspension for a period of six 12 (6) months, pursuant to Rule III, 9 of the Rules of Procedure of the Office of the Ombudsman (Administrative Order No. 7), in relation to 24 of R.A. No. 6770. The order was approved by Ombudsman Conrado M. Vasquez on August 16, 1994 and on August 18, 1994 Acting Secretary of Justice Ramon J. Liwag designated Eduardo Concepcion of Region VII as Acting Provincial Prosecutor of Cebu. On the other hand, the Graft Investigation Officer II, 13 Edgardo G. Canton, issued orders in the two cases, directing petitioner and Provincial Prosecutor Kintanar to submit their counter affidavits and controverting evidence. On September 6, 1994, petitioner Gloria G. Lastimosa filed the present petition for certiorari and prohibition to set aside the following orders of the Office of the Ombudsman and Department of Justice: (a) Letter dated May 17, 1994 of Deputy Ombudsman for Visayas Arturo C. Mojica and related orders, referring to the Office of the Cebu Provincial Prosecutor the records of OMB-VIS-CRIM-93-0140, entitled Jessica V. Dayon vs. Mayor Rogelio Ilustrisimo, "for filing of the appropriate action (for Attempted Rape) with the Regional Trial Court of Danao City. (b) Order dated July 27, 1994 of Deputy Ombudsman Mojica and related orders directing petitioner and Cebu Provincial Prosecutor Oliveros E. Kintanar to explain in writing within three (3) days from receipt why they should not be punished for indirect Contempt of the Office of the Ombudsman "for refusing and failing . . . to file the appropriate Information for Attempted Rape against Mayor Rogelio Ilustrisimo. (c) The 1st Indorsement dated August 9, 1994 of Acting Justice Secretary Ramon J. Liwag, ordering the Office of

the Provincial Prosecutor to comply with the directive of the Office of the Ombudsman that a charge for attempted rape be filed against respondent Mayor Ilustrisimo in recognition of the authority of said Office. (d) Order dated August 15, 1994 of Deputy Ombudsman Mojica, duly approved by Ombudsman Conrado Vasquez, and related orders in OMB-VIS-(ADM)-94-0189, entitled Julian Menchavez vs. Oliveros Kintanar and Gloria Lastimosa, placing petitioner and Provincial Prosecutor Kintanar under preventive suspension for a period of six (6) months, without pay. (e) The 1st Indorsement dated August 18, 1994 of Acting Justice Secretary Liwag directing Assistant Regional State Prosecutor Eduardo O. Concepcion (Region VII) to implement the letter dated August 15, 1994 of Ombudsman Vasquez, together with the Order dated August 15, 1994, placing petitioner and Provincial Prosecutor Kintanar under preventive suspension. (f) Department Order No. 259 issued by Acting Secretary Liwag on August 18, 1994, designating Assistant Regional State Prosecutor Concepcion Acting Provincial Prosecutor of Cebu. Petitioner raises a number of issues which will be discussed not necessarily in the order they are stated in the petition. I. The pivotal question in this case is whether the Office of the Ombudsman has the power to call on the Provincial Prosecutor to assist it in the prosecution of the case for attempted rape against Mayor Ilustrisimo. Lastimosa claims that the Office of the Ombudsman and the prosecutor's office have concurrent authority to investigate public officers or employees and that when the former first took cognizance of the case against Mayor Ilustrisimo, it did so to the exclusion of the latter. It then became the duty of the Ombudsman's office, according to petitioner, to finish the preliminary investigation by filing the information in court instead of asking the Office of the Provincial Prosecutor to do so. Petitioner contends that the preparation and filing of the information were part and parcel of the preliminary investigation assumed by the Office of the Ombudsman and the filing of information in court could not be delegated by it to the Office of the Provincial Prosecutor. Petitioner defends her actuations in conducting a preliminary investigation as having been made necessary by the insistence of the Ombudsman to delegate the filing of the case to her office. In any event, petitioner contends, the Office of the Ombudsman has no jurisdiction over the case against the mayor because the crime involved (rape) was not committed in relation to a public office. For this reason it is argued that the Office of the Ombudsman has no authority to place her and Provincial Prosecutor Kintanar under preventive suspension for refusing to follow his orders and to cite them for indirect contempt for such refusal. Petitioner's contention has no merit. The office of the Ombudsman has the power to "investigate and prosecute on its own or on complaint by any person, any act or omission of any public officer or employee, office or agency, when such act or omission appears to be illegal, 14 unjust, improper or inefficient." This power has been held to include the investigation and prosecution of any

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crime committed by a public official regardless of whether the acts or omissions complained of are related to, or connected with, or arise from, the performance of his 15 official duty It is enough that the act or omission was committed by a public official. Hence, the crime of rape, when committed by a public official like a municipal mayor, is within the power of the Ombudsman to investigate and prosecute. In the existence of his power, the Ombudsman is authorized to call on prosecutors for assistance. 31 of the Ombudsman Act of 1989 (R.A. No. 6770) provides: Designation of Investigators and Prosecutors. The Ombudsman may utilize the personnel of his office and/or designate of deputize any fiscal, state prosecutor or lawyer in the government service to act as special investigator or prosecutor to assist in the investigation and prosecution of certain cases. Those designated or deputized to assist him as herein provided shall be under his supervision and control. (Emphasis added) It was on the basis of this provision that Ombudsman Conrado Vasquez and Deputy Ombudsman Arturo C. Mojica ordered the Provincial Prosecutor of Cebu to file an information for attempted rape against Mayor Rogelio Ilustrismo. It does not matter that the Office of the Provincial Prosecutor had already conducted the preliminary investigation and all that remained to be done was for the Office of the Provincial Prosecutor to file the corresponding case in court. Even if the preliminary investigation had been given over to the Provincial Prosecutor to conduct, his determination of the nature of the offense to be charged would still be subject to the approval of the Office of the Ombudsman. This is because under 31 of the Ombudsman's Act, when a prosecutor is deputized, he comes under the "supervision and control" of the Ombudsman which means that he is subject to the power of the Ombudsman to direct, review, approve, 16 reverse or modify his (prosecutor's) decision. Petitioner cannot legally act on her own and refuse to prepare and file the information as directed by the Ombudsman. II. The records show that despite repeated orders of the Ombudsman, petitioner refused to file an information for attempted rape against Mayor Ilustrisimo, insisting that after investigating the complaint in the case she found that he had committed only acts of lasciviousness. 15(g) of the Ombudsman Act gives the Office of the Ombudsman the power to "punish for contempt, in accordance with the Rules of Court and under the same procedure and with the same penalties provided therein." There is no merit in the argument that petitioner and Provincial Prosecutor Kintanar cannot be held liable for contempt because their refusal arose out of an administrative, rather than judicial, proceeding before the Office of the Ombudsman. As petitioner herself says in another context, the preliminary investigation of a case, of which the filing of an information is a part, is quasi judicial in character. Whether petitioner's refusal to follow the Ombudsman's orders constitutes a defiance, disobedience or resistance of a lawful process, order or command of the Ombudsman thus making her liable for indirect contempt under Rule

71, 3 of the Rules of Court is for respondents to determine after appropriate hearing. At this point it is important only to note the existence of the contempt power of the Ombudsman as a means of enforcing his lawful orders. III. Neither is there any doubt as to the power of the Ombudsman to discipline petitioner should it be found that she is guilty of grave misconduct, insubordination and/or neglect of duty, nor of the Ombudsman's power to place her in the meantime under preventive suspension. The pertinent provisions of the Ombudsman Act of 1989 state: 21. Officials Subject To Disciplinary Authority; Exceptions. The Office of the Ombudsman shall have disciplinary authority over all elective and appointive officials of the Government and its subdivisions, instrumentalities and agencies, including Members of the Cabinet, local government, government-owned or controlled corporations and their subsidiaries, except over officials who may be removed only by impeachment or over Members of Congress, and the Judiciary. 22. Preventive Suspension. The Ombudsman or his Deputy may suspend any officer or employee under his authority pending an investigation, if in his judgment the evidence of guilt is strong, and (a) the charge against such officer or employee involves dishonesty, oppression or grave misconduct or neglect in the performance of duty; (b) the charges would warrant removal from the service; or (c) the respondent's continued stay in office may prejudice the case filed against him. The preventive suspension shall continue until the case is terminated by the Office of the Ombudsman but not more than six months, without pay, except when the delay in the disposition of the case by the Office of the Ombudsman is due to the fault, negligence or petition of the respondent, in which case the period of such delay shall not be counted in computing the period of suspension herein provided. A. Petitioner contends that her suspension is invalid because the order was issued without giving her and Provincial Prosecutor Kintanar the opportunity to refute the charges against them and because, at any rate, the evidence against them is not strong as required by 24. The contention is without merit. Prior notice and hearing is a not required, such suspension not being a penalty but only a preliminary step in an administrative investigation. As 17 held in Nera v. Garcia: 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 not a 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 opportunity to prove his innocence. (Emphasis added). It is true that, under 24 of the Ombudsman's Act, to justify the preventive suspension of a public official, the

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evidence against him should be strong, and any of the following circumstances is present: (a) the charge against such officer or employee involves dishonesty, oppression or grave misconduct or neglect in the performance of duty; (b) the charges would warrant removal from the service; or (c) the respondent's continued stay in office may prejudice the case filed against him. As held in Buenaseda v. Flavier, however, whether the evidence of guilt is strong is left to the determination of the Ombudsman by taking into account the evidence before him. A preliminary hearing as in bail petitions in cases involving capital offenses is not required. In rejecting a similar argument as that made by petitioner in this case, this Court said in that case: The import of the Nera decision is that the disciplining authority is given the discretion to decide when the evidence of guilt is strong. This fact is bolstered by Section 24 of R.A. No. 6770, which expressly left such determination of guilt to the "judgment" of the Ombudsman on the basis of the administrative complaint. 19 ... In this case, respondent Deputy Ombudsman Mojica justified the preventive suspension of petitioner and Provincial Prosecutor Kintanar on the following grounds: A careful assessment of the facts and circumstances of the herein cases and the records pertaining thereto against respondents [Provincial Prosecutor Kintanar and herein petitioner] clearly leads to the conclusion that the evidence on record of guilt is strong and the charges involved offenses of grave misconduct, gross neglect of duty and dishonesty which will warrant respondents [Provincial Prosecutor Kintanar and herein petitioner] removal from the service. Moreover, considering the unabashed attitude of respondents in openly announcing various false pretexts and alibis to justify their stubborn disregard for the lawful directives of the Ombudsman as their official position in their pleadings filed in OMB-VIS-094-0478 and in print and broadcast media, the probability is strong that public service more particularly in the prosecution of cases referred by the Office of the Ombudsman to the Cebu Provincial Prosecutor's office will be disrupted and prejudiced and the records of said cases even be tampered with if respondents [Provincial Prosecutor Kintanar and herein petitioner] are allowed to stay in the Cebu Provincial Prosecutor's Office during the pendency of these proceedings. Indeed respondent Deputy Ombudsman Mojica had personal knowledge of the facts justifying the preventive suspension of petitioner and the Provincial Prosecutor since the acts alleged in the administrative complaint against them were done in the course of their official transaction with the Office of the Ombudsman. The administrative complaint against petitioner and Provincial Prosecutor Kintanar was filed in connection with their designation as deputies of the ombudsman in the prosecution of a criminal case against Mayor Rogelio Ilustrisimo. Respondent Deputy Ombudsman did not have to go far to verify the matters alleged in determine whether the evidence of guilt of petitioner and Provincial
18

Prosecutor was strong for the purpose of placing them under preventive suspension. Given the attitude displayed by petitioner and the Provincial Prosecutor toward the criminal case against Mayor Rogelio Ilustrisimo, their preventive suspension is justified to the end that the proper prosecution of that case 20 may not be hampered. In addition, because the charges against the two prosecutors involve grave misconduct, insubordination and neglect of duty and these charges, if proven, can lead to a dismissal from public office, the Ombudsman was justified in ordering their preventive suspension. B. Petitioner questions her preventive suspension for six (6) months without pay and contends that it should only be for ninety (90) days on the basis of cases decided by this Court. Petitioner is in error. She is referring to cases where the law is either silent or expressly limits the period of suspension to ninety (90) days. With respect to the first situation, we ruled in the case of Gonzaga v. 21 Sandiganbayan that To the extent that there may be cases of indefinite suspension imposed either under Section 13 of Rep. Act 3019, or Section 42 of Pres. Decree 807, it is best for the guidance of all concerned that this Court set forth the rules on the period of preventive suspension under the aforementioned laws, as follows: 1. Preventive suspension under Section 13, Rep. Act 3019 as amended shall be limited to a maximum period of ninety (90) days, from issuances thereof, and this applies to all public officers, (as defined in Section 2(b) of Rep. Act 3019) who are validly charged under said Act. 2. Preventive suspension under Section 42 of Pres. Decree 807 shall apply to all officers or employees whose positions are embraced in the Civil Service, as provided under Sections 3 and 4 of said Pres. Decree 807, and shall be limited to a maximum period of ninety (90) days from issuance, except where there is delay in the disposition of the case, which is due to the fault, negligence or petition of the respondent, in which case the period of delay shall both be counted in computing the period of suspension herein stated; provided that if the person suspended is a presidential appointee, the continuance of his suspension shall be for a reasonable time as the circumstances of the case may warrant. On the other hand, petitioner and the Provincial Prosecutor were placed under preventive suspension pursuant to 24 of the Ombudsman Act which expressly provides that "the preventive suspension shall continue until the case is terminated by the Office of the Ombudsman but not more than six months, without pay." Their preventive suspension for six (6) months without pay is thus according to law. C. Nor is there merit in petitioner's claim that the contempt charge should first be resolved before any action in the administrative complaint case can be taken because the contempt case involves a prejudicial question. There is simply no basis for this contention. The two cases arose out of the same act or omission and may proceed hand in hand, or one can be heard before the other. Whatever order is followed will not really matter.

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WHEREFORE, the petition is DISMISSED for lack of merit and the Motion to Lift Order of Preventive Suspension is DENIED. SO ORDERED. Narvasa, C.J., Feliciano, Padilla, Bidin, Davide, Jr., Bellosillo, Melo, Quiason, Puno, Vitug, Kapunan and Francisco, JJ., concur. Romero, J., is on leave.

for resolution if the parties would not opt for a formal hearing. The preparatory procedures before such stage is reached undoubtedly necessitate and consume a lot of time. Yet, it will be noted that those preliminary steps are included in the case of the period of preventive suspension ordered even before issues are joined, as in preventive suspension by the Ombudsman pursuant to the aforecited Section 24 of Republic Act No. 6770. They conceivably include the service of the subpoena or order for the respondent to file his counter-affidavits, the usual resort to motions for extension of time to comply with the same, the improvident recourse to the Supreme Court to suspend, annul or otherwise delay the proceedings, as well as the filing and resolution of motions to dismiss or for a bill of particulars or for the inhibition of the investigating officer, the denial of which motions is often also brought all over again to this Court on petitions for certiorari. An illustration of how the proceedings can be delayed by such procedural maneuvers is afforded by the case of 5 Buenaseda, et al. vs. Flavier, et al., the decision in which was ultimately promulgated by this Court on September 21, 1993. The petitioners therein questioned through repeated resourceful submissions the order of preventive suspension issued by the Ombudsman on January 7, 1992 and it took more than twenty (20) months before said order could eventually be reviewed on the merits and finally sustained by the Supreme Court. That is not all. Even after the formal hearing is scheduled, respondents can easily resort to the same dilatory tactics usually employed by an accused in regular court trials in criminal actions. Such stratagems can obviously result in the continued occupancy by the respondent of his office and, in the language of the law, could "prejudice the case filed against him." The longer period of six (6) months for preventive suspension under Republic Act No. 6770 was evidently induced by a desire to more meaningfully emphasize and implement the authority of the Office of the Ombudsman over public officials and employees in order to serve as a deterrent against illegal, unjust, improper and inefficient conduct on their part. As the agency mandated by the Constitution to undertake such task, it was invested with the corresponding authority to enable it to perform its mission. This intention is easily deducible from the pertinent constitutional provisions creating said office and from the express provisions of Republic Act No. 6770. Significantly, it is the only body authorized to investigate 6 even officials removable by impeachment. For purposes of the present case, therefore, and specifically on the issue subject of this concurring opinion, it would be advisable to recall what we said in Buenaseda, to wit: The purpose of RA No. 6770 is to give the Ombudsman such powers as he may need to perform efficiently the task committed to him by the Constitution. Such being the case, said statute, particularly its provisions dealing with procedure, should be given such interpretation that will effectuate the purposes and objective of the Constitution. Any interpretation that will hamper the work of the Ombudsman should be avoided. A statute granting powers to an agency created by the Constitution should be liberally construed for the

Separate Opinions

REGALADO, J., concurring: I concur and welcome this opportunity to make some observations on the matter of the power of the Ombudsman to preventively suspend petitioner for six (6) months without pay, and which petitioner assails in the case at bar. It would, of course, be a handy expedient to just refer petitioner to the provisions of Section 24 of Republic Act No. 6770 which expressly grants that authority to respondent Ombudsman. Conveniently, we would merely need to remind petitioner that for this Court to limit such authority to suspend to a lesser period would, in effect, be constitutive of judicial legislation. But I will go a little further by essaying the rationale for such conferment of a more extended authority to the Ombudsman on the issue of preventive suspension, vis-a-vis the provisions on preventive suspension in other enactments, and thereby dispel lingering doubts or misgivings thereon. It is true that the Civil Service Decree allows a maximum 1 preventive suspension of only ninety (90) days. 2 However, a comparison of the grounds therefor with 3 those provided for in the Ombudsman Act will readily show that there is in the latter the added requirement that the evidence of guilt is strong and the additional ground that "the respondent's continued stay in office may prejudice the case filed against him." Further, in the aforecited Section 41 of the Civil Service Decree, preventive suspension may be imposed on the mere simple showing that the charge involves dishonesty, oppression or grave misconduct, neglect in the performance of duty, or if there are reasons to believe that the respondent is guilty of charges which would warrant his removal from the service: whereas in Section 24 of Republic Act No. 6770, it is required that such charges must be supported by strong evidence of guilt in order to justify preventive suspension. On the other hand, the still shorter period of sixty (60) 4 days prescribed in the Local Government Code of 1991 as the maximum period for the preventive suspension of local elective officials is justifiable and deemed sufficient not only because the respondent involved is elected by the people, but more precisely because such preventive suspension may only be ordered "after the issues are joined." That means that before the order of suspension is issued, all the preliminary requirements and exchanges had been completed and the respondent had already filed his counter-affidavits to the affidavits of the complainant and the latter's witnesses. At that stage, the case is ready

29

advancement of the purposes and objectives for Department of which it was created (Cf. Department of Public Utilities v. Arkansas Louisiana Gas, Co., 200 Ark. 983, 142 S.W. [2d] 213 [1940]; Wallace v. Feehan, 206 Ind. 522, 190 N.E. 438 [1934]). On the foregoing considerations, which are much a matter of judicial and legislative experience, it is puerile for petitioner to impugn the expanded authority of preventive suspension as now granted by law to the Ombudsman. In fact, in certain situations, the maximum allowable period may even prove too short to subserve the intended purpose of the law.

for resolution if the parties would not opt for a formal hearing. The preparatory procedures before such stage is reached undoubtedly necessitate and consume a lot of time. Yet, it will be noted that those preliminary steps are included in the case of the period of preventive suspension ordered even before issues are joined, as in preventive suspension by the Ombudsman pursuant to the aforecited Section 24 of Republic Act No. 6770. They conceivably include the service of the subpoena or order for the respondent to file his counter-affidavits, the usual resort to motions for extension of time to comply with the same, the improvident recourse to the Supreme Court to suspend, annul or otherwise delay the proceedings, as well as the filing and resolution of motions to dismiss or for a bill of particulars or for the inhibition of the investigating officer, the denial of which motions is often also brought all over again to this Court on petitions for certiorari. An illustration of how the proceedings can be delayed by such procedural maneuvers is afforded by the case of 5 Buenaseda, et al. vs. Flavier, et al., the decision in which was ultimately promulgated by this Court on September 21, 1993. The petitioners therein questioned through repeated resourceful submissions the order of preventive suspension issued by the Ombudsman on January 7, 1992 and it took more than twenty (20) months before said order could eventually be reviewed on the merits and finally sustained by the Supreme Court. That is not all. Even after the formal hearing is scheduled, respondents can easily resort to the same dilatory tactics usually employed by an accused in regular court trials in criminal actions. Such stratagems can obviously result in the continued occupancy by the respondent of his office and, in the language of the law, could "prejudice the case filed against him." The longer period of six (6) months for preventive suspension under Republic Act No. 6770 was evidently induced by a desire to more meaningfully emphasize and implement the authority of the Office of the Ombudsman over public officials and employees in order to serve as a deterrent against illegal, unjust, improper and inefficient conduct on their part. As the agency mandated by the Constitution to undertake such task, it was invested with the corresponding authority to enable it to perform its mission. This intention is easily deducible from the pertinent constitutional provisions creating said office and from the express provisions of Republic Act No. 6770. Significantly, it is the only body authorized to investigate 6 even officials removable by impeachment. For purposes of the present case, therefore, and specifically on the issue subject of this concurring opinion, it would be advisable to recall what we said in Buenaseda, to wit: The purpose of RA No. 6770 is to give the Ombudsman such powers as he may need to perform efficiently the task committed to him by the Constitution. Such being the case, said statute, particularly its provisions dealing with procedure, should be given such interpretation that will effectuate the purposes and objective of the Constitution. Any interpretation that will hamper the work of the Ombudsman should be avoided. A statute granting powers to an agency created by the Constitution should be liberally construed for the

Separate Opinions REGALADO, J., concurring: I concur and welcome this opportunity to make some observations on the matter of the power of the Ombudsman to preventively suspend petitioner for six (6) months without pay, and which petitioner assails in the case at bar. It would, of course, be a handy expedient to just refer petitioner to the provisions of Section 24 of Republic Act No. 6770 which expressly grants that authority to respondent Ombudsman. Conveniently, we would merely need to remind petitioner that for this Court to limit such authority to suspend to a lesser period would, in effect, be constitutive of judicial legislation. But I will go a little further by essaying the rationale for such conferment of a more extended authority to the Ombudsman on the issue of preventive suspension, vis-a-vis the provisions on preventive suspension in other enactments, and thereby dispel lingering doubts or misgivings thereon. It is true that the Civil Service Decree allows a maximum 1 preventive suspension of only ninety (90) days. 2 However, a comparison of the grounds therefor with 3 those provided for in the Ombudsman Act will readily show that there is in the latter the added requirement that the evidence of guilt is strong and the additional ground that "the respondent's continued stay in office may prejudice the case filed against him." Further, in the aforecited Section 41 of the Civil Service Decree, preventive suspension may be imposed on the mere simple showing that the charge involves dishonesty, oppression or grave misconduct, neglect in the performance of duty, or if there are reasons to believe that the respondent is guilty of charges which would warrant his removal from the service: whereas in Section 24 of Republic Act No. 6770, it is required that such charges must be supported by strong evidence of guilt in order to justify preventive suspension. On the other hand, the still shorter period of sixty (60) 4 days prescribed in the Local Government Code of 1991 as the maximum period for the preventive suspension of local elective officials is justifiable and deemed sufficient not only because the respondent involved is elected by the people, but more precisely because such preventive suspension may only be ordered "after the issues are joined." That means that before the order of suspension is issued, all the preliminary requirements and exchanges had been completed and the respondent had already filed his counter-affidavits to the affidavits of the complainant and the latter's witnesses. At that stage, the case is ready

30

advancement of the purposes and objectives for Department of which it was created (Cf. Department of Public Utilities v. Arkansas Louisiana Gas, Co., 200 Ark. 983, 142 S.W. [2d] 213 [1940]; Wallace v. Feehan, 206 Ind. 522, 190 N.E. 438 [1934]). On the foregoing considerations, which are much a matter of judicial and legislative experience, it is puerile for petitioner to impugn the expanded authority of preventive suspension as now granted by law to the Ombudsman. In fact, in certain situations, the maximum allowable period may even prove too short to subserve the intended purpose of the law.

SO ORDERED.

On November 28, 1996, Mayor Malonzo came to us on a "Petition for Certiorari With Prayer For Temporary Restraining Order and Application for Writ of Preliminary Injunction", assailing the COMELEC's resolution as having been issued with grave abuse of discretion. The Petition, in the main, raises the issue of the validity of the institution and proceedings of the recall, putting to fore the propriety of the service of notices to the members of the Preparatory Recall Assembly, and the proceedings held, resulting in the issuance of the questioned Resolution. Due to the importance of the matters in issue, and the proximity of the Recall Election date declared by the COMELEC, the Court, on November 29, 1996, issued a 3 Resolution ordering the respondent COMELEC to cease and desist from proceeding with the recall election projected on December 14, 1996, and directing the respondents to file their respective Comments. Private respondents Liga ng mga Barangay (Caloocan Chapter), Alex L. David, Conrado G. Cruz, Trinidad Repuno, Gloria M. Cruz, Mirali M. Durr, Fermin Jimenez, Aurelio Biluan, Rogelio Saraza, Helene Valbuena and 4 Higino Rullepa, filed their Comment on December 6, 1996, alleging that all the requirements for the holding of a recall election were duly complied with and that the petition is therefore without basis. On the other hand, the Office of the Solicitor General filed a Manifestation in lieu 5 of Comment on February 7, 1997, with the surprising submission that the COMELEC was amiss in its duties as enforcer of election laws. According to the Solicitor General, the veracity of notices sent to 42 members of the Preparatory Recall Assembly were not directly passed upon by the COMELEC before it issued the questioned Resolution. It thus submits that the propriety of notices sent to said PRA members must first be determined by the COMELEC, after giving private respondents the chance to prove the same, otherwise, a discussion of the other issues in the present petition would be premature. At this juncture, the Court finds that there is no need to refer the matter of the veracity of the questioned notices sent to certain members of the Preparatory Recall Assembly back to the COMELEC, for the reason that the COMELEC has already conducted an investigation into the same, and has found the proceedings instituting the recall to be in accord with law. The Solicitor General's observation that the issue of veracity of the notices was not directly passed upon by the COMELEC is incorrect. On the contrary, the matter of validity of notices to the members of the Preparatory Recall Assembly was sufficiently considered by the respondent Commission, as in response to petitioner's request for a technical examination of the recall documents, the COMELEC directed its Election Records and Statistics Department (ERSD) to resolve the matter of notices sent to the Preparatory Recall Assembly members. The ERSD in turn performed its task and reported its findings to the COMELEC. The following excerpts from Resolution UND 96-026 of the COMELEC reflect the results of the ERSD's investigation, and the resulting action of the COMELEC: The ERSD Report gave the following information:

G.R. No. 127066 March 11, 1997 REYNALDO O. MALONZO, petitioner, vs. THE HONORABLE COMMISSION ON ELECTIONS and THE LIGA NG MGA BARANGAY (Caloocan Chapter) and ALEX L. DAVID, CONRADO G. CRUZ, TRINIDAD REPUNO, GLORIA M. CRUZ, MIRALI M. DURR, FERMIN JIMENEZ, AURELIO BILUAN, ROGELIO SARAZA, HELENE VALBUENA, and HIGINO RULLEPA, respondents.

TORRES, JR., J.: The Court is called upon to strike down Resolution 961 026, dated November 18, 1996, of the respondent Commission on Elections (COMELEC) calling for an Election for the Recall of the Petitioner Reynaldo O. Malonzo, the incumbent Mayor of Caloocan City. Petitioner was duly elected as Mayor in the elections held on May 8, 1995, winning over former Mayor Macario Asistio, Jr. Barely one year into his term, petitioner's office as Mayor was put to serious question when on July 7, 1996, 1,057 Punong Barangays and Sangguniang Barangay members and Sangguniang Kabataan chairmen, constituting a majority of the members of the Preparatory Recall Assembly of the City of Caloocan, met, and upon deliberation and election, voted for the approval of Preparatory Recall Assembly Resolution No. 01-96, expressing loss of confidence in Mayor Malonzo, and calling for the initiation of recall proceedings against him. Together with relevant documents, PRA Resolution No. 01-96 was filed with the COMELEC for appropriate action. In response, Mayor Malonzo filed a Petition with the respondent Commission alleging, principally, that the recall process was deficient in form and substance, and therefore, illegally initiated. The COMELEC found the petition devoid of merit and declared the recall proceedings to be in order. The COMELEC's Resolution on the petition states pertinently: WHEREFORE, in view of the foregoing, the Commission En Banc hereby RESOLVES to DISMISS the Petition. We approve and give DUE COURSE to PRA Resolution No. 01-96 entitled RESOLUTION TO INITIATE RECALL OF REYNALDO O. MALONZO AS MAYOR OF KALOOCAN CITY FOR LOSS OF CONFIDENCE. Accordingly and conformably with Section 71 R.A. 7160, the Commission SETS the date of the Election on Recall on December 14, 1996. We shall, by separate resolution, issue a calendar of activities involved in said exercise.

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Three (3) lists of elected Barangay officials were used as reference, namely: COMELEC list; DILG list and Caloocan City list. According to the COMELEC listing, of the 188 barangays in Kalookan City, there should have been 1,692 members of the PRA. However, one barangay, Barangay 94, did not elect an SK Chairman, thus, there are of record, 1,691 elected barangay officials of Kalookan City, broken down as follows: Punong Barangay 188 Barangay Kagawads 1,316 SK Chairmen 187 (One Barangay, Barangay 94 did not elect its SK Chairman). The DILG registry is incomplete, showing only a listing of 1,390 barangay officials. The Kalookan City Talaan ng mga Barangay tallies with the COMELEC List. From the records, the following data is found: Of the 1,691 barangay officials, forty (40) had resigned. In the stead of twenty-eight (28) resignees, replacements were appointed. Twelve (12) positions however, remained vacant, there being no successors named therein. Twenty-two (22) barangay officials are deceased. Twelve (12) vacancies caused by such death were filled up by appointing replacements. Ten (10) vacant positions were however not filled up. There being twenty-two (22) unfilled posts, the total number of Barangay officials of Kalookan City at the time of the constitution of the Preparatory Recall Assembly was initiated is 1,669. ERSD reported that there were a total of 1,927 notices sent, some members being served two or three notices. The Notices were sent in three modes; Personal, registered mail and by courier and they were in the name of the PRA member, and addressed at his residence or office of record. In its initial report, the Department stated that six persons listed in the COMELEC record as barangay officials were not duly notified. These were: Jose de Chavez, listed as Barangay kagawad of Barangay; 6; Enrico Marasigan, listed as Barangay kagawad of Barangay 65; Pablo Musngi, listed as Barangay kagawad of Barangay 119; Rolando Ang, listed as Barangay kagawad of Barangay 109; and Pilar Pilares, Barangay Kagawad of Barangay 162 and Teresita Calayo, listed as kagawad of Barangay 182. Respondents explained the absence of notice to these persons thus: 1. Jose de Chavez has been removed from office as Barangay kagawad of Barangay 6 by virtue of Resolution No. 95-011 passed on July 16, 1995, and has been replaced by Corazon Obusan by virtue of Resolution No. 95-016 passed on August 1995, both promulgated by the Barangay Council of said barangay. In view of the fact that it is Corazon Obusan who is the recognized Barangay kagawad of the aforementioned barangay, as it appears in the official roster of the Department of Interior and Local Government (DILG) the notice of the July 7, 1996 PRA session was duly served on her and not on Mr. de Chavez. 2. Enrico Marasigan has resigned as Barangay kagawad of Barangay 65 as evidenced by his resignation letter dated March 24, 1995. He was replaced by Ronio de la Cruz, by virtue of a Resolution passed by the Barangay

Council of Barangay 65 dated August 10, 1995. Accordingly, the notice of the July 7, 1996 PRA session was duly served on Mr. de la Cruz and not on Mr. Marasigan. 3. Pablo Musngi ceased to be a Barangay kagawad of Barangay 119 by reason of his death on April 12, 1996. He has been replaced by Sylvia Saberola on whom notice of the July 7, 1996 PRA session has been duly served. 4. Notices, both by personal delivery and by registered mail, were served on Mr. Rolando Ang at his official address at Barangay 109 Zone 10 East Grace Park, Caloocan City. The returns of the said service of notice, however, disclosed that he can no longer be located in the said address. He has, however, not informed the DILG of any change in his official address. 5. Pilar Pilares had been served notice by personal delivery but refused to sign acknowledgment receipt. She has likewise been served notice by registered mail as evidenced by the receipt in her behalf by a certain Ricardo Pilares III. (Respondents' Comment, dated October 14, 1996. As to Teresita Calayo, respondent defends lack of notice to her, thus: Teresita Calayo is not a duly elected kagawad of Barangay 182, Zone 16. Per certification issued by the Board of Election Tellers, Ms. Calayo did not win in the May 1994 Barangay Election. Records would show that it should be Kagawad Fermin Quintos who should be recognized as legitimate barangay kagawad of the said barangay having placed no. 7 in the election and not Ms. Calayo who appears to be a loser/9th place. There appears to be an apparent oversight in placing the name of Calayo in the subject PRA Resolution for signature, wherein it shows that both the names of Fermin Quintos and Teresita Calayo are included. (Respondents' Compliance dated November 13, 1996, p. 6). In the ERSD's final and complete report, two (2) additional names were reflected as not having been served notices and these were Line Ramos and Teodulfo Abenoja, listed as kagawads of Barangay 174. Commenting on this report, respondents stated: 1. As regards Tomas Daep and Teodulfo Abenoja (not Agenoja);. Notice by registered mail was served on, and acknowledged by Tomas Daep, who personally signed the return card. There was actually an error committed by the ERSD when it concluded that Tomas Daep has already resigned and was replaced by Ernesto Taupa. Official records would show that Tomas Daep and Ernesto Taupa are still both presently holding the position of Kagawad of Barangay 174 Zone 15. Ernesto Taupa was officially appointed to the position vacated by Teodulfo Abenoja by virtue of the latter's resignation on 15 March 1996. Teodulfo Abenoja, on the other hand, was appointed to the position vacated by a Line Ramos and Teodulfo Abenoja they, having resigned and, the latter, having been already replaced by Ernesto Taupa.

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Ernesto Taupa on the other, as correctly determined by the ERSD, was validly served with the notice of the PRA session two (2) days before the scheduled PRA meeting. Respondents' submission, being substantiated by documents. and uncontroverted by Petitioner are hereby accepted as meritorious. In addition to the aforenamed, three persons, Pablo de Castro, Ruben Ballega, and Jesus Tan claiming to be the Barangay captains of Barangay 116, Barangay 148 and Barangay 156, respectively, and therefore members of the Preparatory Recall Assembly, came before the Commission and manifested that they were not duly notified about the PRA session. The records in custody of the Commission, however, revealed that there was no truth to their allegations. Pablo de Castro was served notice by registered mail on July 1, 1996, and this he received on July 3, 1996, as shown in the return card duly signed in acknowledgment. The same notice was served on him by courier (LBC) on July 5, 1996. Ruben Ballega was notified by personal service on July 1, 1996, the receipt of which was duly acknowledged and by registered mail on July 2, 1996. Jesus Tan Sr. was served notice personally and by registered mail. The personal service was completed on July 1, 1996, as shown by the receipt signed by his daughter, one Analiza T. Asque. The same notice was sent him by registered mail, received by the same daughter on July 2, 1996. The Commission however regards the sending of notice one thing, and the completion of service thereof another, for indeed, the requirement of notice can only be fully satisfied, if there was not only service, but also completion of service thereof. Thus, we were obliged to inquire more closely into the records and we found: Personal services were acknowledged by receipts signed, if not by the addressee himself, then, as indicated thereon, by his or her spouse, nearest relative or a person of sufficient discretion in the member 's residence or office. Service by registered mail was evinced by the return card duly signed by the addressee or by persons acting for him. There were instances when notices were served but were refused, this fact noted in the acknowledgment receipt by the server and his witnesses. The circumstances being thus, we hold that there was complete service of the notices as contemplated in Section 8, Rule 13 of the Rules of Court which provides; Sec. 8 Completeness of Service Personal service is complete upon delivery. Service by ordinary mail is complete upon the expiration of five (5) days after mailing, unless the court otherwise provides; Service by registered mail is complete upon actual receipt by the addressee; but if he fails to claim his mail from the post office within five (5) days from the date of first notice of the postmaster, service shall take effect at the expiration of such time. That it was Alex David, President of the LIGA ng mga Barangay who sent the notices is of no moment. We had earlier determined that as member of the PRA, he can legally exercise the prerogatives attached to his membership in the Preparatory Recall Assembly, sending notices to the other members of its scheduled convening.

It is evident from the foregoing and, therefore, the Commission so holds that the requirements of notice had 6 been fully complied with. Needless to state, the issue of propriety of the notices sent to the PRA members is factual in nature, and the determination of the same is therefore a function of the COMELEC. In the absence of patent error, or serious inconsistencies in the findings, the Court should not disturb the same. The factual findings of the COMELEC, based on its own assessments and duly supported by gathered evidence, are conclusive upon the court, more so, in the absence of a substantiated attack on the validity of the same. Moreover, to order the COMELEC to repeat the process of determining the notices' propriety would be sanctioning a recycling of administrative functions, entailing added cost and waste of effort. Petitioner likewise attacks the COMELEC's ruling on the validity of the proceedings held by the Preparatory Recall Assembly, in that it allegedly ruled that the LIGA ng mga Barangay is authorized to initiate the recall and convene the Preparatory Recall Assembly. Petitioner likewise averred that the session held, and the adoption of the recall resolution, by the recall assembly were tainted with irregularities, violence, graft and corruption. The pertinent provisions of law, as regards the initiation of the recall process, are Sections 69 and 70 of R.A. 7160: Sec. 69. By whom Exercised. The power of recall for loss of confidence shall be exercised by the registered voters of a local government unit to which the local elective official subject to such recall belongs. Sec. 70. Initiation of the Recall Process. (a) Recall may be initiated by a preparatory recall assembly or by the registered voters of the local government unit to which the local elective official subject to such recall belongs. (b) There shall be a preparatory recall assembly in every province, city, district, and municipality which shall be composed of the following: xxx xxx xxx (2) City level. All punong barangay and sangguniang barangay members in the city; xxx xxx xxx (c) A majority of all the preparatory recall assembly members may convene in session in a public place and initiate a recall proceeding against any elective official in the local government unit concerned. Recall of provincial, city, or municipal officials shall be validly initiated through a resolution adopted by a majority of all the members of the preparatory recall assembly concerned during its session called for the purpose. (d) Recall of any elective provincial, city, municipal, or barangay official may also be validly initiated upon petition of at least 25% of the total number of registered voters in the local government unit concerned during the election in which the local official sought to be recalled was elected. (1) A written petition for recall duly signed before the election registrar or his representative, and in the presence of a representative of the petitioner and a representative of the official sought to be recalled, and in

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a public place in the province, city, municipality, or barangay, as the case may be, shall be filed with the COMELEC through its office in the local government unit concerned. The COMELEC or its duly authorized representative shall cause the publication of the petition in a public and conspicuous place for a period of not less than ten (10) days nor more than twenty (20) days, for the purpose of verifying the authenticity and genuineness of the petition and the required percentage of voters. (2) Upon the lapse of the aforesaid period, the COMELEC or its duly authorized representative shall announce the acceptance of candidates to the position and thereafter prepare the list of candidates which shall include the name of the official sought to be recalled. Petitioner's insistence, that the initiation of the recall proceedings was infirm since it was convened by the Liga ng mga Barangays, is misplaced. Petitioner observes that "respondent Liga is an organization of all barangays. It is not an organization of barangay captains and kagawads. The barangays are represented in the Liga by the barangay captains as provided under Section 492 of the Local Government Code. It also provides that the Kagawad may represent the barangay in the absence of 7 the barangay chairman." The Liga ng mga Barangay is undoubtedly an entity distinct from the Preparatory Recall Assembly. It just so happens that the personalities representing the barangays in the Liga are the very members of the Preparatory Recall Assembly, the majority of whom met on July 7, 1996, and voted in favor of the resolution calling for the recall of Mayor Malonzo, after deliberation reported in the record, in accordance with the existing law. Thus, the Punong Barangays and Sangguniang Barangay members convened and voted as members of the Preparatory Recall Assembly of the City of Caloocan, and not as members of the Liga ng mga Barangay. The recall proceedings, therefore, cannot be denied merit on this ground. Any doubt as to the propriety of the proceedings held during the recall assembly should be laid to rest. As the respondent COMELEC pertinently observes: The Minutes of the session of the Preparatory Assembly indicated that there was a session held. Attendees constitute the majority of all the members of the Preparatory Assembly, as we shall later on establish. Rules of procedure, simple they may be were formulated. Deliberations were conducted on the main issue, which was that of petitioner's recall. The members were given the opportunity to articulate on their resolve about the matter. More importantly, their sentiments were expressed through their votes signified by their signatures and thumbmarks affixed to the Resolution. No proof was adduced by Petitioner to substantiate his claim that the signatures appearing thereon represented a cause other than that of adopting the resolution. The law on recall did not prescribe an elaborate proceeding. Neither did it demand a specific procedure. What is fundamental is compliance with the provision that there should be a session called for the purpose of initiating recall proceedings, attended by a majority of all the members of the preparatory recall assembly, in a public place and that the resolution resulting from such assembly be adopted by 8 a majority of all the PRA members.

The charges of graft and corruption, violence and irregularities, before and during the session of the preparatory recall assembly are largely uncorroborated, and cannot override the substantiated findings of the respondent COMELEC. In cases filed before administrative and quasi-judicial bodies, a fact may be deemed established if it is supported by substantial evidence, or that amount of relevant evidence which a reasonable mind might accept 9 as adequate to justify a conclusion. Substantial evidence means such relevant evidence as a reasonable mind might accept as adequate to support a 10 conclusion. It means such evidence which affords a substantial basis from which the fact in issue can be 11 reasonably inferred. To overturn the presumption of validity of performance of official duty, more than a mere scintilla of proof is needed, otherwise, one disgruntled fellow can destroy the foundations laid by the overwhelming majority, and this is not the scenario envisioned by our democratic system of government. In sum, we are persuaded strongly by the principle that the findings of fact of administrative bodies charged with their specific field of expertise, are afforded great weight by the courts, and in the absence of substantial showing that such findings are made from an erroneous estimation of the evidence presented, they are conclusive, and in the interest of stability of the governmental structure, should not be disturbed. ACCORDINGLY, the Court hereby RESOLVED to DISMISS the present petition, for lack of merit. The decision of the respondent Commission on Elections to GIVE DUE COURSE to PRA Resolution No. 01-96 is hereby AFFIRMED. The Commission on Elections is hereby ORDERED to set the date of the Election on Recall in the city of Caloocan, which date shall not be later than thirty days after receipt of notice of this Resolution, which is immediately executory. SO ORDERED.

G.R. No. 117565 November 18, 1997 ARSENIO P. LUMIQUED (deceased), Regional Director, DAR CAR, Represented by his Heirs, Francisca A. Lumiqued, May A. Lumiqued, Arlene A. Lumiqued and Richard A. Lumiqued, petitioners, vs. Honorable APOLONIO G. EXEVEA, ERDOLFO V. BALAJADIA and FELIX T. CABADING, ALL Members of Investigating Committee, created by DOJ Order No. 145 on May 30, 1992; HON. FRANKLIN M. DRILON, SECRETARY OF JUSTICE, HON. ANTONIO T. CARPIO, CHIEF Presidential Legal Adviser/Counsel; and HON. LEONARDO A. QUISUMBING, Senior Deputy Executive Secretary of the Office of the President, and JEANNETTE OBAR-ZAMUDIO, Private Respondent, respondents.

ROMERO, J.: Does the due process clause encompass the right to be assisted by counsel during an administrative inquiry? Arsenio P. Lumiqued was the Regional Director of the Department of Agrarian Reform Cordillera Autonomous

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Region (DAR-CAR) until President Fidel V. Ramos dismissed him from that position pursuant to Administrative Order No. 52 dated May 12, 1993. In view of Lumiqued's death on May 19, 1994, his heirs instituted this petition for certiorari and mandamus, questioning such order. The dismissal was the aftermath of three complaints filed by DAR-CAR Regional Cashier and private respondent Jeannette Obar-Zamudio with the Board of Discipline of the DAR. The first affidavit-complaint dated November 16, 1 1989, charged Lumiqued with malversation through falsification of official documents. From May to September 1989, Lumiqued allegedly committed at least 93 counts of falsification by padding gasoline receipts. He even submitted a vulcanizing shop receipt worth P550.00 for gasoline bought from the shop, and another receipt for P660.00 for a single vulcanizing job. With the use of falsified receipts, Lumiqued claimed and was reimbursed the sum of P44,172.46. Private respondent added that Lumiqued seldom made field trips and preferred to stay in the office, making it impossible for him to consume the nearly 120 liters of gasoline he claimed everyday. In her second affidavit-complaint dated November 22, 2 1989, private respondent accused Lumiqued with violation of Commission on Audit (COA) rules and regulations, alleging that during the months of April, May, July, August, September and October, 1989, he made unliquidated cash advances in the total amount of P116,000.00. Lumiqued purportedly defrauded the government "by deliberately concealing his unliquidated cash advances through the falsification of accounting entries in order not to reflect on 'Cash advances of other officials' under code 8-70-600 of accounting rules." The third affidavit-complaint dated December 15, 1989, charged Lumiqued with oppression and harassment. According to private respondent, her two previous complaints prompted Lumiqued to retaliate by relieving her from her post as Regional Cashier without just cause. The three affidavit-complaints were referred in due course to the Department of Justice (DOJ) for appropriate action. On May 20, 1992, Acting Justice Secretary Eduardo G. Montenegro issued Department Order No. 145 creating a committee to investigate the complaints against Lumiqued. The order appointed Regional State Prosecutor Apolinario Exevea as committee chairman with City Prosecutor Erdolfo Balajadia and Provincial Prosecutor Felix Cabading as members. They were mandated to conduct an investigation within thirty days from receipt of the order, and to submit their report and recommendation within fifteen days from its conclusion. The investigating committee accordingly issued a subpoena directing Lumiqued to submit his counteraffidavit on or before June 17, 1992. Lumiqued, however, filed instead an urgent motion to defer submission of his counter-affidavit pending actual receipt of two of private respondent's complaints. The committee granted the motion and gave him a five-day extension. In his counter-affidavit dated June 23, 1992, Lumiqued alleged, inter alia, that the cases were filed against him to extort money from innocent public servants like him, and were initiated by private respondent in connivance with a certain Benedict Ballug of Tarlac and a certain Benigno Aquino III. He claimed that the apparent weakness of the
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charge was bolstered by private respondent's execution of 5 an affidavit of desistance. Lumiqued admitted that his average daily gasoline consumption was 108.45 liters. He submitted, however, that such consumption was warranted as it was the aggregate consumption of the five service vehicles issued under his name and intended for the use of the Office of the Regional Director of the DAR. He added that the receipts which were issued beyond his region were made in the course of his travels to Ifugao Province, the DAR Central Office in Diliman, Quezon City, and Laguna, where he attended a seminar. Because these receipts were merely turned over to him by drivers for reimbursement, it was not his obligation but that of auditors and accountants to determine whether they were falsified. He affixed his signature on the receipts only to signify that the same were validly issued by the establishments concerned in order that official transactions of the DAR-CAR could be carried out. Explaining why a vulcanizing shop issued a gasoline receipt, Lumiqued said that he and his companions were cruising along Santa Fe, Nueva Vizcaya on their way to Ifugao when their service vehicle ran out of gas. Since it was almost midnight, they sought the help of the owner of a vulcanizing shop who readily furnished them with the gasoline they needed. The vulcanizing shop issued its own receipt so that they could reimburse the cost of the gasoline. Domingo Lucero, the owner of said vulcanizing shop, corroborated this explanation in an affidavit dated 6 June 25, 1990. With respect to the accusation that he sought reimbursement in the amount of P660.00 for one vulcanizing job, Lumiqued submitted that the amount was actually only P6.60. Any error committed in posting the amount in the books of the Regional Office was not his personal error or accountability. To refute private respondent's allegation that he violated COA rules and regulations in incurring unliquidated cash advances in the amount of P116,000.00, Lumiqued 7 presented a certification of DAR-CAR Administrative Officer Deogracias F. Almora that he had no outstanding cash advances on record as of December 31, 1989. In disputing the charges of oppression and harassment against him, Lumiqued contended that private respondent was not terminated from the service but was merely relieved of her duties due to her prolonged absences. While admitting that private respondent filed the required applications for leave of absence, Lumiqued claimed that the exigency of the service necessitated disapproval of her application for leave of absence. He allegedly rejected her second application for leave of absence in view of her failure to file the same immediately with the head office or upon her return to work. He also asserted that no medical certificate supported her application for leave of absence. In the same counter-affidavit, Lumiqued also claimed that private respondent was corrupt and dishonest because a COA examination revealed that her cash accountabilities from June 22 to November 23, 1989, were short by P30,406.87. Although private respondent immediately returned the amount on January 18, 1990, the day following the completion of the cash examination, Lumiqued asserted that she should be relieved from her duties and assigned to jobs that would not require handling of cash and money matters.

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Committee hearings on the complaints were conducted on July 3 and 10, 1992, but Lumiqued was not assisted by counsel. On the second hearing date, he moved for its resetting to July 17, 1992, to enable him to employ the services of counsel. The committee granted the motion, but neither Lumiqued nor his counsel appeared on the date he himself had chosen, so the committee deemed the case submitted for resolution. On August 12, 1992, Lumiqued filed an urgent motion for 8 additional hearing, alleging that he suffered a stroke on July 10, 1992. The motion was forwarded to the Office of the State Prosecutor apparently because the investigation had already been terminated. In an order 9 dated September 7, 1992, State Prosecutor Zoila C. Montero denied the motion, viz: The medical certificate given show(s) that respondent was discharged from the Sacred Heart Hospital on July 17, 1992, the date of the hearing, which date was upon the request of respondent (Lumiqued). The records do not disclose that respondent advised the Investigating committee of his confinement and inability to attend despite his discharge, either by himself or thru counsel. The records likewise do not show that efforts were exerted to notify the Committee of respondent's condition on any reasonable date after July 17, 1992. It is herein noted that as early as June 23, 1992, respondent was already being assisted by counsel. Moreover an evaluation of the counter-affidavit submitted reveal(s) the sufficiency, completeness and thoroughness of the counter-affidavit together with the documentary evidence annexed thereto, such that a judicious determination of the case based on the pleadings submitted is already possible. Moreover, considering that the complaint-affidavit was filed as far back as November 16, 1989 yet, justice can not be delayed much longer. Following the conclusion of the hearings, the investigating 10 committee rendered a report dated July 31, 1992, finding Lumiqued liable for all the charges against him. It made the following findings: After a thorough evaluation of the evidences (sic) submitted by the parties, this committee finds the evidence submitted by the complainant sufficient to establish the guilt of the respondent for Gross Dishonesty and Grave Misconduct. That most of the gasoline receipts used by the respondent in claiming for the reimbursement of his gasoline expenses were falsified is clearly established by the 15 Certified Xerox Copies of the duplicate receipts (Annexes G-1 to G-15) and the certifications issued by the different gasoline stations where the respondent purchased gasoline. Annexes "G-1" to "G-15" show that the actual average purchase made by the respondent is about 8.46 liters only at a purchase price of P50.00, in contrast to the receipts used by the respondent which reflects an average of 108.45 liters at a purchase price of P550.00. Here, the greed of the respondent is made manifest by his act of claiming reimbursements of more than 10 times the value of what he actually spends. While only 15 of the gasoline receipts were ascertained to have been falsified, the motive, the pattern and the scheme employed by the respondent in defrauding the government has, nevertheless, been established.

That the gasoline receipts have been falsified was not rebutted by the respondent. In fact, he had in effect admitted that he had been claiming for the payment of an average consumption of 108.45 liters/day by justifying that this was being used by the 4 vehicles issued to his office. Besides he also admitted having signed the receipts. Respondent's act in defrauding the government of a considerable sum of money by falsifying receipts constitutes not only Dishonesty of a high degree but also a criminal offense for Malversation through Falsification of Official Documents. This committee likewise finds that the respondent have (sic) unliquidated cash advances in the year 1989 which is in violation of established office and auditing rules. His cash advances totaling to about P116,000.00 were properly documented. The requests for obligation of allotments and the vouchers covering the amounts were all signed by him. The mere certification issued by the Administrative Officer of the DAR-CAR cannot therefore rebut these concrete evidences (sic). On the third complaint, this committee likewise believes that the respondent's act in relieving the complainant of her functions as a Regional Cashier on December 1, 1989 was an act of harassment. It is noted that this was done barely two weeks after the complainant filed charges against her (sic). The recommendation of Jose G. Medina of the Commission on Audit came only on May 11, 1990 or almost six months after the respondent's order relieving the complainant was issued. His act in harassing a subordinate employee in retaliation to a complaint she filed constitute(s) Gross Misconduct on the part of the respondent who is a head of office. The affidavits of Joseph In-uyay and Josefina Guting are of no help to the respondent. In fact, this only show(s) that he is capable of giving bribes if only to have the cases against him dismissed. He could not have given a certain Benigno Aquino III the sum of P10,000.00 for any other purpose. Accordingly, the investigating committee recommended Lumiqued's dismissal or removal from office, without prejudice to the filing of the appropriate criminal charges against him. Acting on the report and recommendation, former Justice Secretary Franklin M. Drilon adopted the same in his Memorandum to President Fidel V. Ramos dated October 22, 1992. He added that the filing of the affidavit of 11 desistance would not prevent the issuance of a resolution on the matter considering that what was at stake was not only "the violation of complainant's (herein private respondent's) personal rights" but also "the competence and fitness of the respondent (Lumiqued) to remain in public office." He opined that, in fact, the evidence on record could call for "a punitive action against the respondent on the initiative of the DAR." On December 17, 1992, Lumiqued filed a motion for reconsideration of "the findings of the Committee" with the 12 DOJ. Undersecretary Ramon S. Esguerra indorsed the 13 motion to the investigating committee. In a letter dated April 1, 1993, the three-member investigating committee informed Undersecretary Esguerra that the committee "had no more authority to act on the same (motion for reconsideration) considering that the matter has already been forwarded to the Office of the President" and that

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their authority under Department Order No. 145 ceased when they transmitted their report to the 14 DOJ. Concurring with this view, Undersecretary Esguerra informed Lumiqued that the investigating committee could no longer act on his motion for reconsideration. He added that the motion was also prematurely filed because the Office of the President (OP) 15 had yet to act on Secretary Drilon's recommendation. On May 12, 1993, President Fidel V. Ramos himself 16 issued Administrative Order No. 52 (A.O. No. 52), finding Lumiqued administratively liable for dishonesty in the alteration of fifteen gasoline receipts, and dismissing him from the service, with forfeiture of his retirement and other benefits. Thus: That the receipts were merely turned over to him by his drivers and that the auditor and accountant of the DARCAR should be the ones to be held liable is untenable. The receipts in question were signed by respondent for the purpose of attesting that those receipts were validly issued by the commercial establishments and were properly disbursed and used in the official business for which it was intended. This Office is not about to shift the blame for all these to the drivers employed by the DAR-CAR as respondent would want us to do. The OP, however, found that the charges of oppression and harassment, as well as that of incurring unliquidated cash advances, were not satisfactorily established. In a "petition for appeal" addressed to President Ramos, Lumiqued prayed that A.O. No. 52 be reconsidered and that he be reinstated to his former position "with all the benefits accorded to him by law and existing rules and regulations." This petition was basically premised on the affidavit dated May 27, 1993, of a certain Dwight L. Lumiqued, a former driver of the DAR-CAR, who confessed to having authored the falsification of gasoline receipts and attested to petitioner Lumiqued's being an "honest man" who had no "premonition" that the 18 receipts he (Dwight) turned over to him were "altered." Treating the "petition for appeal" as a motion for reconsideration of A.O. No. 52, the OP, through Senior Deputy Executive Secretary Leonardo A. Quisumbing, denied the same on August 31, 1993. Undaunted, Lumiqued filed a second motion for reconsideration, alleging, among other things, that he was denied the constitutional right to counsel during the 19 20 hearing. On May 19, 1994, however, before his motion could be resolved, Lumiqued died. On September 21 28, 1994, Secretary Quisumbing denied the second motion for reconsideration for lack of merit. Hence, the instant petition for certiorari and mandamus praying for the reversal of the Report and Recommendation of the Investigating Committee, the October 22, 1992, Memorandum of then Justice Secretary Drilon, A.O. No. 52 issued by President Ramos, and the orders of Secretary Quisumbing. In a nutshell, it prays for the "payment of retirement benefits and other benefits accorded to deceased Arsenio Lumiqued by law, payable to his heirs; and the backwages from the period he was dismissed from service up to the time of his death on May 22 19, 1994."
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Petitioners fault the investigating committee for its failure to inform Lumiqued of his right to counsel during the hearing. They maintain that his right to counsel could not be waived unless the waiver was in writing and in the presence of counsel. They assert that the committee should have suspended the hearing and granted Lumiqued a reasonable time within which to secure a counsel of his own. If suspension was not possible, the committee should have appointed a counsel de oficio to assist him. These arguments are untenable and misplaced. The right to counsel, which cannot be waived unless the waiver is in writing and in the presence of counsel, is a right afforded 23 a suspect or an accused during custodial investigation. It is not an absolute right and may, thus, be invoked or rejected in a criminal proceeding and, with more reason, in an administrative inquiry. In the case at bar, petitioners invoke the right of an accused in criminal proceedings to have competent and independent counsel of his own choice. Lumiqued, however, was not accused of any crime in the proceedings below. The investigation conducted by the committee created by Department Order No. 145 was for the purpose of determining if he could be held administratively liable under the law for the complaints filed against him. The order issued by Acting Secretary of Justice Montenegro states thus: In the interest of the public service and pursuant to the provisions of existing laws, a Committee to conduct the formal investigation of the administrative complaint for oppression, dishonesty, disgraceful and immoral conduct, being notoriously undesirable and conduct prejudicial to the best interest of the service against Mr. ARSENIO P. LUMIQUED, Regional Director, Department of Agrarian Reform, Cordillera Autonomous Region, is hereby created 24 ... As such, the hearing conducted by the investigating committee was not part of a criminal prosecution. This was even made more pronounced when, after finding Lumiqued administratively liable, it hinted at the filing of a criminal case for malversation through falsification of public documents in its report and recommendation. Petitioners' misconception on the nature of the 25 investigation conducted against Lumiqued appears to have been engendered by the fact that the DOJ conducted it. While it is true that under the Administrative Code of 1987, the DOJ shall "administer the criminal justice system in accordance with the accepted processes thereof consisting in the investigation of the crimes, prosecution of offenders and administration of the 26 correctional system, conducting criminal investigations is not its sole function. By its power to "perform such other 27 functions as may be provided by law," prosecutors may be called upon to conduct administrative investigations. Accordingly, the investigating committee created by Department Order No. 145 was duty-bound to conduct the administrative investigation in accordance with the rules therefor. While investigations conducted by an administrative body may at times be akin to a criminal proceeding, the fact remains that under existing laws, a party in an administrative inquiry may or may not be assisted by counsel, irrespective of the nature of the charges and of the respondent's capacity to represent himself, and no

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duty rests on such a body to furnish the person being 28 investigated with counsel. In an administrative proceeding such as the one that transpired below, a respondent (such as Lumiqued) has the option of engaging the services of counsel or not. This is clear from the provisions of Section 32, Article VII of Republic Act 29 No. 2260 (otherwise known as the Civil Service Act) and Section 39, paragraph 2, Rule XIV (on Discipline) of the Omnibus Rules Implementing Book V of Executive 30 Order No. 292 (otherwise known as the Administrative Code of 1987). Excerpts from the transcript of stenographic notes of the hearings attended by Lumiqued 31 clearly show that he was confident of his capacity and so opted to represent himself . Thus, the right to counsel is not imperative in administrative investigations because such inquiries are conducted merely to determine whether there are facts that merit disciplinary measures against erring public officers and employees, with the purpose of maintaining the dignity of government service. Furthermore, petitioners' reliance on Resolution No. 940521 of the Civil Service Commission on the Uniform Procedure in the Conduct of Administrative Investigation stating that a respondent in an administrative complaint must be "informed of his right to the assistance of a 32 counsel of his choice," is inappropriate. In the first place, this resolution is applicable only to cases brought 33 before the Civil Service Commission. Secondly, said resolution, which is dated January 25, 1994, took effect fifteen days following its publication in a newspaper of 34 general circulation, much later than the July 1992 hearings of the investigating committee created by Department Order No. 145. Thirdly, the same committee was not remiss in the matter of reminding Lumiqued of his right to counsel. Thus, at the July 3, 1992, hearing, Lumiqued was repeatedly appraised of his option to secure the services of counsel: RSP EXEVEA: This is an administrative case against Director Lumiqued. Director Lumiqued is present. The complainant is present, Janet Obar-Zamudio. Complainant has just been furnished with a copy of the counter-affidavit of the respondent. Do you have a counsel, Director? DIR. LUMIQUED: I did not bring anybody, Sir, because when I went to see him, he told me, Sir, that he has already set a hearing, morning and afternoon today. RSP EXEVEA: So, we will proceed with the hearing even without your counsel? You are willing to proceed with the hearing even without your counsel? DIR. LUMIQUED: Yes, I am confident. . . CP BALAJADIA: You are confident that you will be able to represent yourself? DIR. LUMIQUED: That is my concern.
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CP BALAJADIA: Q. (To Director Lumiqued) You really wish to go through with this even without your counsel? DIRECTOR LUMIQUED: A. I think so, Sir. CP BALAJADIA: Let us make it of record that we have been warning you to proceed with the assistance of counsel but you said that you can take care of yourself so we have no other 36 alternative but to proceed. (Emphasis supplied). Thereafter, the following colloquies transpired: CP BALAJADIA: We will suspend in the meantime that we are waiting for the supplemental affidavit you are going to present to us. Do you have any request from the panel of investigators, Director Lumiqued? DIRECTOR LUMIQUED: I was not able to bring a lawyer since the lawyer I requested to assist me and was the one who prepared my counter-affidavit is already engaged for a hearing and according to him he is engaged for the whole month of July. RSP EXEVEA: We cannot wait . . . CP BALAJADIA: Why don't you engage the services of another counsel. The charges against you are quite serious. We are not saying you are guilty already. We are just apprehensive that you will go through this investigation without a counsel. We would like you to be protected legally in the course of this investigation. Why don't you get the services of another counsel. There are plenty here in Baguio . . . DIRECTOR LUMIQUED: I will try to see, Sir . . . CP BALAJADIA: Please select your date now, we are only given one month to finish the investigation, Director Lumiqued. RSP EXEVEA: We will not entertain any postponement. With or without counsel, we will proceed. CP BALAJADIA: Madam Witness, will you please submit the document which we asked for and Director Lumiqued, if you have other witnesses, please bring them but reduce their testimonies in affidavit form so that we can expedite with 37 the proceedings. At the hearing scheduled for July 10, 1992, Lumiqued still did not avail of the services of counsel. Pertinent excerpts from said hearing follow: FISCAL BALAJADIA: I notice also Mr. Chairman that the respondent is not being represented by a counsel. The last time he was asked to invite his lawyer in this investigation. May we know if he has a lawyer to represent him in this investigation? DIR. LUMIQUED:

(Emphasis supplied)

In the course of private respondent's damaging testimony, the investigating committee once again reminded Lumiqued of his need for a counsel. Thus:

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There is none Sir because when I went to my lawyer, he told me that he had set a case also at 9:30 in the other court and he told me if there is a possibility of having this case postponed anytime next week, probably Wednesday so we will have good time (sic) of presenting the affidavit. FISCAL BALAJADIA: Are you moving for a postponement Director? May I throw this to the panel. The charges in this case are quite serious and he should be given a chance to the assistance of a counsel/lawyer. RSP EXEVEA: And is (sic) appearing that the supplemental-affidavit has been furnished him only now and this has several documents attached to it so I think we could grant him one last postponement considering that he has already asked for an extension. DIR. LUMIQUED: Furthermore Sir, I am now being bothered by my heart 38 ailment. The hearing was reset to July 17, 1992, the date when Lumiqued was released from the hospital. Prior to said date, however, Lumiqued did not inform the committee of his confinement. Consequently because the hearing could not push through on said date, and Lumiqued had already submitted his counter-affidavit, the committee decided to wind up the proceedings. This did not mean, however, that Lumiqued was short-changed in his right to due process. Lumiqued, a Regional Director of a major department in the executive branch of the government, graduated from the University of the Philippines (Los Baos) with the degree of Bachelor of Science major in Agriculture, was a recipient of various scholarships and grants, and 39 underwent training seminars both here and abroad. Hence, he could have defended himself if need be, without the help of counsel, if truth were on his side. This, apparently, was the thought he entertained during the hearings he was able to attend. In his statement, "That is my concern," one could detect that it had been uttered testily, if not exasperatedly, because of the doubt or skepticism implicit in the question, "You are confident that you will be able to represent yourself?" despite his having positively asserted earlier, "Yes, I am confident." He was obviously convinced that he could ably represent himself. Beyond repeatedly reminding him that he could avail himself of counsel and as often receiving the reply that he is confident of his ability to defend himself, the investigating committee could not do more. One can lead a horse to water but cannot make him drink. The right to counsel is not indispensable to due process unless required by the Constitution or the law. In Nera v. 40 Auditor General, the Court said: . . . There is nothing in the Constitution that says that a party in a non-criminal proceeding is entitled to be represented by counsel and that, without such representation, he shall not be bound by such proceedings. The assistance of lawyers; while desirable, is not indispensable. The legal profession was not engrafted in the due process clause such that without the participation of its members, the safeguard is deemed ignored or violated. The ordinary citizen is not that

helpless that he cannot validly act at all except only with a lawyer at his side. In administrative proceedings, the essence of due process is simply the opportunity to explain one's side. One may be heard, not solely by verbal presentation but also, and perhaps even much more creditably as it is more 41 practicable than oral arguments, through pleadings. An actual hearing is not always an indispensable aspect of 42 due process. As long as a party was given the opportunity to defend his interests in due course; he cannot be said to have been denied due process of law, for this opportunity to be heard is the very essence of due 43 process. Moreover, this constitutional mandate is deemed satisfied if a person is granted an opportunity to seek reconsideration of the action or ruling complained of. 44 Lumiqued's appeal and his subsequent filing of motions for reconsideration cured whatever irregularity attended 45 the proceedings conducted by the committee. The constitutional provision on due process safeguards 46 life, liberty and property. In the early case of Cornejo v. Gabriel and Provincial Board of 47 Rizal the Court held that a public office is not property within the sense of the constitutional guarantee of due process of law for it is a public trust or agency. This jurisprudential pronouncement has been enshrined in the 1987 Constitution under Article XI, Section 1, on accountability of public officers, as follows: Sec. 1. Public office is a public trust. Public officers and employees must at all times be accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency, act with patriotism and justice, and lead modest lives. When the dispute concerns one's constitutional right to security of tenure, however, public office is deemed analogous to property in a limited sense; hence, the right to due process could rightfully be invoked. Nonetheless, the right to security of tenure is not absolute. Of equal weight is the countervailing mandate of the Constitution that all public officers and employees must serve with 48 responsibility, integrity, loyalty and efficiency. In this case, it has been clearly shown that Lumiqued did not live up to this constitutional precept. The committee's findings pinning culpability for the charges of dishonesty and grave misconduct upon Lumiqued were not, as shown above, fraught with procedural mischief. Its conclusions were founded on the evidence presented and evaluated as facts. Well-settled in our jurisdiction is the doctrine that findings of fact of administrative agencies must be respected as long as they are supported by substantial evidence, even if such evidence is not overwhelming or 49 preponderant. The quantum of proof necessary for a finding of guilt in administrative cases is only substantial evidence or such relevant evidence as a reasonable mind 50 might accept as adequate to support a conclusion. Consequently, the adoption by Secretary Drilon and the OP of the committee's recommendation of dismissal may not in any way be deemed tainted with arbitrariness amounting to grave abuse of discretion. Government officials are presumed to perform their functions with regularity. Strong evidence is not necessary to rebut that 51 presumption, which petitioners have not successfully disputed in the instant case.

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Dishonesty is a grave offense penalized by dismissal under Section 23 of Rule XIV of the Omnibus Rules Implementing Book V of the Administrative Code of 1987. Under Section 9 of the same Rule, the penalty of dismissal carries with it "cancellation of eligibility, forfeiture of leave credits and retirement benefits, and the disqualification for reemployment in the government service." The instant petition, which is aimed primarily at the "payment of retirement benefits and other benefits," plus back wages from the time of Lumiqued's dismissal until his demise, must, therefore, fail. WHEREFORE, the instant petition for certiorari and mandamus is hereby DISMISSED and Administrative Order no. 52 of the Office of the President is AFFIRMED. Costs against petitioners. SO ORDERED.

were received by the respective addressees on December 3 8 and 9, 1975. Similar notices were sent to the Provincial Fiscal of Pasig and to the Provincial Warden of Pasig, Rizal, who both 4 received them on December 2,1975, On the date set for promulgation of the decision, counsel for accused moved for postponement, raising for the first time the alleged loss of jurisdiction of the trial court for failure to decide the case within 90 days from submission thereof for decision. Acceding to counsel's request that he be given time to consider the proper remedial measure to take, the respondent judge reset the promulgation of the decision to January 19, 1976 at 8:30 A. M. On January 19, 1976, counsel for petitioner moved anew for the resetting of the promulgation of decision. Granting the motion, respondent judge rescheduled the promulgation to January 26, 1976. Meanwhile, on January 12, 1976, counsel for the accused filed before Us the present petition. On January 16, 1976, this Court issued an Order temporarily restraining respondent judge from promulgating the decision in Criminal Case No, C-5910. Petitioner espouses the thesis that the three-month period prescribed by Section 11[l] of Article X of the 1973 Constitution, being a constitutional directive, is mandatory in character and that non-observance thereof results in the loss of jurisdiction of the court over the unresolved case. We disagree. Undisputed is the fact that on November 28, 1975, or eighty- five [851 days from September 4, 1975 the date the case was deemed submitted for decision, respondent judge filed with the deputy clerk of court the decision in Criminal Case No. 5910. He had thus veritably rendered his decision on said case within the three-month period prescribed by the Constitution. In Comia v. Nicolas, Ago v. Court of Appeals and 7 Balquidra v. Court of First Instance this Court ruled that the rendition of the judgment in trial courts refers to the filing of the signed decision with the clerk of court. There is no doubt that the constitutional provision cited by petitioner refers to the rendition of judgment and not to the promulgation thereof. Thus, it is this date that should be considered in determining whether or not respondent judge had resolved the case within the allotted period. Indeed, the date of promulgation of a decision could not serve as the reckoning date because the same necessarily comes at at a later date, considering that notices have to be sent to the accused as well as to the other parties involved, an event which is beyond the control of the judge. As pointed out in People v. Court of 8 Appeals , the promulgation of a judgment in the trial court does not necessarily coincide with the date of its delivery by the judge of the clerk of court. Section 11 [1], Article X of the New Constitution provides in full, to wit: SEC. 11 [1]. Upon the effectivity of this Constitution, the maximum period within which a case or matter shall be decided or resolved from the date of its submission, shall be eighteen months for the Supreme court, and, unless reduced by the Supreme Court, twelve months for all inferior collegiate courts, and three months for all other inferior courts.
5 6

G.R. No. L-42428 March 18, 1983 BERNARDINO MARCELINO, petitioner, vs. THE HON. FERNANDO CRUZ, JR., as Presiding Judge of Branch XII of the Court of First Instance of Rizal, PEOPLE OF THE PHILIPPINES, and THE PROVINCIAL WARDEN OF THE PROVINCIAL JAIL OF RIZAL, respondents.

ESCOLIN, J.: A petition for prohibition and writ of habeas corpus to enjoin respondent Judge Fernando Cruz, Jr. from promulgating his decision in Criminal Case No. C-5910, entitled People of the Philippines versus Bernardino Marcelino, and for release from detention of petitioner, the accused in said case, on the ground of loss of jurisdiction of respondent trial court over the case for failure to decide the same within the period of ninety [90] days from submission thereof. Petitioner was charged with the crime of rape before the Court of First Instance of Rizal, Branch XII. Trial was conducted and the same was concluded when the accused rested his case on August 4, 1975. On the same date, however, the attorneys for both parties moved for time within which to submit their respective memoranda. The trial court granted the motion as follows: Upon joint motion, the parties are given thirty [30] days to submit their respective memoranda, simultaneously, and thereafter the case shall be deemed submitted for decision of the Court. Counsel for petitioner submitted his memorandum in due time, but no memorandum was filed by the People. On November 28, 1975, respondent judge filed with the Deputy Clerk of Court his decision in said case for promulgation. The decision was also dated November 28, 1 1975. A certification dated January 26, 1976 was executed by Postmaster Jesse A. Santos of the Grace Park Post Office 2 to the effect that registered letters Nos. 011980 and 011981, addressed to Marietta Ferrer of 9-E Mango Road, Portero, Malabon, Rizal, the complaining witness, and Atty, Angel P. Purisima of 414 Shurdut Bldg., Intramuros, Manila, counsel for the accused, respectively, were posted in said office on December 4, 1975. These notices

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To date, no authoritative interpretation of the abovequoted provision has been rendered by this Court. Thus, in approaching this novel question, We now tread upon what Mr. Cooley characterizes as "very dangerous ground when they [referring to the courts] venture to apply rules which distinguish directory and mandatory statutes to the 9 provisions of a constitution." The established rule is that "constitutional provisions are to be construed as mandatory, unless by express provision or by necessary implication, a different intention 10 is manifest." "The difference between a mandatory and a directory provision is often determined on grounds of expediency, the reason being that less injury results to the general public by disregarding than by enforcing the letter 11 of the law." In Trapp v. McCormick, a case calling for the interpretation of a statute containing a limitation of thirty [30] days within which a decree may be entered without the consent of counsel, it was held that "the statutory provisions which may be thus departed from with impunity, without affecting the validity of statutory proceedings, are usually those which relate to the mode or time of doing that which is essential to effect the aim and purpose of the Legislature or some incident of the essential act. " Thus, in said case, the statute under examination was construed merely to be directory. On this view, authorities are one in saying that: Statutes requiring the rendition of judgment forthwith or immediately after the trial or verdict have been held by some courts to be merely directory so that noncompliance with them does not invalidate the judgment, on the theory that if the statute had intended such result it would clearly have indicated it." [American Tupe Founders Co. v. Justice's Court, 133 Cal. 819, 65 Pac. 742; Heillen v. Phillips, 88 Cal. 557, 26 Pac. 366; Drake v. Bagley, 69 Mo. App. 39, State v. Davis, 194 Mo. 585, 5 Ann. Cas. 1000, 4 L.R.A. (N.S.) 1023, 92 S.W. 484; Wissman v. Meagher, 115 Mo. App. 82, 91 S.W. 448; Pohle v. Dickmann, 67 Mo. App. 381; Herwick v. Koken Barber Supply Co., 61 Mo. App. 454]. Such construction applies equally to the constitutional provision under consideration. In Mikell v. School Dis. of 13 Philadelphia, it was ruled that "the legal distinction between directory and mandatory laws is applicable to fundamental as it is to statutory laws." To Our mind, the phraseology of the provision in question indicates that it falls within the exception rather than the general rule. By the phrase "unless reduced by the Supreme Court," it is evident that the period prescribed therein is subject to modification by this Court in accordance with its prerogative under Section 5[5] of Article X of the New Constitution to "promulgate rules concerning pleading, practice and procedure in all courts ... " And there can be no doubt that said provision, having been incorporated for reasons of expediency, relates merely to matters of procedure. Albermarle Oil & Gas Co. 14 v. Morris, declares that constitutional provisions are directory, and not mandatory, where they refer to matters merely procedural. In practice, We have assumed a liberal stand with respect to this provision. This Court had at various times, upon proper application and for meritorious reasons, allowed judges of inferior courts additional time beyond the three12

month period within which to decide cases submitted to them. The reason is that a departure from said provision would result in less injury to the general public than would its strict application. To hold that non-compliance by the courts with the aforesaid provision would result in loss of jurisdiction, would make the courts, through which conflicts are resolved, the very instruments to foster unresolved causes by reason merely of having failed to render a decision within the alloted term. Such an absurd situation could not have been intended by the framers of our fundamental law. As foreseen by Mr. Henry Campbell Black in his 15 Construction and Interpretation of the Laws, the constitutional provision in question should be held merely as directory. "Thus, where the contrary construction) would lead to absurd, impossible or mischievous consequences, it should not be followed. " One last point, Notwithstanding Our conclusion that courts are not divested of their jurisdiction for failure to decide a case within the ninety-day period, We here emphasize the rule, for the guidance of the judges manning our courts, that cases pending before their salas must be decided within the aforementioned period. Failure to observe said rule constitutes a ground for administrative sanction against the defaulting judge. In fact a certificate to this certificate is required before judges are allowed Lo draw their salaries. WHEREFORE, the petition is hereby dismissed; and the Restraining Order dated January 16, 1976 issued by this Court is lifted. Since respondent Judge Fernando Cruz, Jr. is already deceased, his successor is hereby ordered to decide Criminal Case No. C-5910 on the basis of the record thereof within ninety [90] days from the time the case is raffled to him. SO ORDERED. Makasiar (Chairman), Concepcion Jr., Guerrero and De Castro, JJ., concur. Aquino, J., is on leave.

Separate Opinions

ABAD SANTOS, J., concurring: I concur and I wish to add the following observations: The petitioner sinks release from detention on the ground of loss of jurisdiction of the trial court allegedly because its judge failed to decide his case within 90 days from the date of its submission. Section 11(1), Art. X of the Constitution is invoked. The main opinion states that the 90-day period was not exceeded in this case and I agree. But exceeded or not, a decision rendered by an inferior court outside of the 90day period is not void for loss of jurisdiction. To hold otherwise is to make the administration of justice depend heavily on the frailities of a human judge. A decision rendered beyond the 90-day period, I submit, is valid and the only consequence is to subject the erring judge to administrative action. "... failure to comply with the injunction for judges to decide their cases within 90 days from submission merely deprives them of their right to collect their salaries or to apply for leave (section 5, Judiciary Act of 1948; section 129, Revised Administrative

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Code) but does not deprive them of jurisdiction to act in the causes pending before them." (Dimson vs. Elepao, 99 Phil. 733, 737 ,1956].) The judge who wrote the questioned decision has died. It cannot now be promulgated. "It is well-settled that, to be binding, a judgment must be duly signed and promulgated during the incumbency of the judge whose signature appears thereon." (People vs. So, July 30, 1957, No. L8732, citing Lino Luna v. Rodriguez, 37 Phil. 186; Garchitorena v. Crescini, 37 Phil. 675; Barredo v. The Commission on Elections, 45 Off. Gaz. 4457; People v. Court of Appeals, G.R. No. L-9111-9113.) For this reason, petitioner's case has to be declared by another judge.

Encanto, Mabugat & Associates for UCPB. Mangalindan and Bermas Law Offices for private respondent. Federico Reyes for Manuel L. Co.

CRUZ, J.: We are asked once again to interpret the constitutional provision that no decision shall be rendered by any court without stating therein clearly and distinctly the facts and 1 the law on which it is based, this time in connection with an order of the trial court sustaining demurrer to the 2 evidence. The order has been affirmed by the 3 respondent Court of Appeals, and the appellant has come to this Court in this petition for review on certiorari, invoking the said provision and alleging several reversible errors. In the complaint filed by the petitioners before the Regional Trial Court of Bulacan, it was alleged that on January 24, 1980, NICOS Industrial Corporation obtained a loan of P2,000,000.00 from private respondent United Coconut Planters Bank and to secure payment thereof executed a real estate mortgage on two parcels of land located at Marilao, Bulacan. The mortgage was foreclosed for the supposed non-payment of the loan, and the sheriff's sale was held on July 11, 1983, without republication of the required notices after the original date for the auction was changed without the knowledge or consent of the mortgagor. UCPB was the highest and lone bidder and the mortgaged lands were sold to it for P3,558,547.64. On August 29, 1983, UCPB sold all its rights to the properties to private respondent Manuel Co, who on the same day transferred them to Golden Star Industrial Corporation, another private respondent, upon whose petition a writ of possession was issued to it on November 4, 1983. On September 6, 1984, NICOS and the other petitioners, as chairman of its board of directors and its executive vice-president, respectively, filed their action for "annulment of sheriff's sale, recovery of possession, and damages, with prayer for the issuance of a preliminary prohibitory and mandatory injunction." Golden Star and Victorino P. Evangelista, as ex officio sheriff of Bulacan, moved to dismiss the complaint on the grounds of lack of jurisdiction, prescription, estoppel, and regularity of the sheriff's sale. Co denied the allegations of the plaintiffs and, like the other defendants, counterclaimed for damages. In its answer with counterclaim, UCPB defended the foreclosure of the mortgage for failure of NICOS to pay the loan in accordance with its promissory note and insisted that the sheriff's sale had been conducted in accordance with the statutory requirements. The plaintiffs presented two witnesses, including petitioner Carlos Coquinco, who testified at three separate hearings. They also submitted 21 exhibits. On April 30, 1986, Golden Star and Evangelista filed a 7-page demurrer to the evidence where they argued that the action was a derivative suit that came under the jurisdiction of the Securities and Exchange Commission; that the mortgage had been validly foreclosed; that the sheriff's sale had been held in accordance with Act 3135; that the notices had been duly published in a newspaper of general circulation; and that the opposition to the writ of

Separate Opinions ABAD SANTOS, J., concurring: I concur and I wish to add the following observations: The petitioner sinks release from detention on the ground of loss of jurisdiction of the trial court allegedly because its judge failed to decide his case within 90 days from the date of its submission. Section 11(1), Art. X of the Constitution is invoked. The main opinion states that the 90-day period was not exceeded in this case and I agree. But exceeded or not, a decision rendered by an inferior court outside of the 90day period is not void for loss of jurisdiction. To hold otherwise is to make the administration of justice depend heavily on the frailities of a human judge. A decision rendered beyond the 90-day period, I submit, is valid and the only consequence is to subject the erring judge to administrative action. "... failure to comply with the injunction for judges to decide their cases within 90 days from submission merely deprives them of their right to collect their salaries or to apply for leave (section 5, Judiciary Act of 1948; section 129, Revised Administrative Code) but does not deprive them of jurisdiction to act in the causes pending before them." (Dimson vs. Elepao, 99 Phil. 733, 737 ,1956].) The judge who wrote the questioned decision has died. It cannot now be promulgated. "It is well-settled that, to be binding, a judgment must be duly signed and promulgated during the incumbency of the judge whose signature appears thereon." (People vs. So, July 30, 1957, No. L8732, citing Lino Luna v. Rodriguez, 37 Phil. 186; Garchitorena v. Crescini, 37 Phil. 675; Barredo v. The Commission on Elections, 45 Off. Gaz. 4457; People v. Court of Appeals, G.R. No. L-9111-9113.) For this reason, petitioner's case has to be declared by another judge.

G.R. No. 88709 February 11, 1992 NICOS INDUSTRIAL CORPORATION, JUAN COQUINCO and CARLOS COQUINCO, petitioners, vs. THE COURT OF APPEALS, VICTORINO P. EVANGELISTA, in his capacity as Ex-Officio Sheriff of Bulacan, UNITED COCONUT PLANTERS BANK, MANUEL L. CO, GOLDEN STAR INDUSTRIAL CORPORATION and THE REGISTER OF DEEDS FOR THE PROVINCE OF BULACAN, respondents. Manuel T. Ubarra for petitioners.

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possession had not been filed on time. No opposition to the demurrer having been submitted despite notice thereof to the parties, Judge Nestor F. Dantes considered it submitted for resolution and on June 6, 1986, issued the following ORDER Acting on the "Demurrer to Evidence" dated April 30, 1986 filed by defendants Victorino P. Evangelista and Golden Star Industrial Corporation to which plaintiff and other defendants did not file their comment/opposition and it appearing from the very evidence adduced by the plaintiff that the Sheriff's Auction Sale conducted on July 11, 1983 was in complete accord with the requirements of Section 3, Act 3135 under which the auction sale was appropriately held and conducted and it appearing from the allegations in paragraph 13 of the plaintiff's pleading and likewise from plaintiff Carlos Coquinco's own testimony that his cause is actually-against the other officers and stockholders of the plaintiff Nicos Industrial Corporation ". . . for the purpose of protecting the corporation and its stockholders, as well as their own rights and interests in the corporation, and the corporate assets, against the fraudulent ants and devices of the responsible officials of the corporation, in breach of the trust reposed upon them by the stockholders . . ." a subject matter not within the competent jurisdiction of the Court, the court finds the same to be impressed with merit. WHEREFORE, plaintiff's complaint is hereby dismissed. The Defendants' respective counterclaims are likewise dismissed. The Writ of Preliminary Injunction heretofore issued is dissolved and set aside. It is this order that is now assailed by the petitioners on the principal ground that it violates the aforementioned constitutional requirement. The petitioners claim that it is not a reasoned decision and does not clearly and distinctly explain how it was reached by the trial court. They also stress that the sheriff's sale was irregular because the notices thereof were published in a newspaper that did not have general circulation and that the original date of the sheriff's sale had been changed without its consent, the same having been allegedly given by a person not authorized to represent NICOS. It is also contended that the original P2 million loan had already been paid and that if there was indeed a second P2 million loan also secured by the real estate mortgage, it was for UCPB to prove this, as well as its allegation that NICOS had defaulted in the payment of the first quarterly installment on the first loan. The petitioners complain that there was no analysis of their testimonial evidence or of their 21 exhibits, the trial court merely confining itself to the pronouncement that the sheriff's sale was valid and that it had no jurisdiction over the derivative suit. There was therefore no adequate factual or legal basis for the decision that could justify its review and affirmance by the Court of Appeals. Rejecting this contention, the respondent court held: In their first assignment of error, appellants faults the court for its failure to state clearly and distinctly the facts and the law on which the order of dismissal is based, as

required by Section 1, Rule 36, of the Rules of Court and the Constitution. An order granting a demurrer to the evidence is in fact an adjudication on the merits and consequently the requirements of Section 1, Rule 36, is applicable. We are not however prepared to hold that there is a reversible omission of the requirements of the rule in the Order appealed from, it appearing from a reading thereof that there is substantial reference to the facts and the law on which it is based. The Order which adverts to the Demurrer to the Evidence expressly referred to the evidence adduced by the plaintiff as showing that the Sheriff's auction sale conducted on July 11, 1983, was in complete accord with the requisites of Section 3, Act 3135 under which the auction sale was apparently held and conducted. It likewise makes reference to the allegations in paragraph 13 of plaintiff's pleadings and plaintiff Carlos Coquinco's own testimony that the case is actually against the other officers and stockholders of plaintiff NICOS Industrial Corporation and concludes, rightly or wrongly, that the subject matter thereof is not within the competent jurisdiction of the Court. We hold that the order appealed from as framed by the court a quo while leaving much to be desired, substantially complies with the rules. This Court does not agree. The questioned order is an over-simplification of the issues, and violates both the letter and spirit of Article VIII, Section 14, of the Constitution. It is a requirement of due process that the parties to a litigation be informed of how it was decided, with an explanation of the factual and legal reasons that led to the conclusions of the court. The court cannot simply say that judgment is rendered in favor of X and against Y and just leave it at that without any justification whatsoever for its action. The losing party is entitled to know why he lost, so he may appeal to a higher court, if permitted, should he believe that the decision should be reversed. A decision that does not clearly and distinctly state the facts and the law on which it is based leaves the parties in the dark as to how it was reached and is especially prejudicial to the losing party, who is unable to pinpoint the possible errors of the court for review by a higher tribunal. It is important to observe at this point that the constitutional provision does not apply to interlocutory orders, such as one granting a motion for postponement or quashing a subpoena, because it "refers only to decisions on the merits and not to orders of the trial court 4 resolving incidental matters." As for the minute resolutions of this Court, we have already observed in 5 Borromeo v. Court of Appeals that The Supreme Court disposes of the bulk of its cases by minute resolutions and decrees them as final and executory, as where a case is patently without merit, where the issues raised are factual in nature, where the decision appealed from is supported by substantial evidence and is in accord with the facts of the case and the applicable laws, where it is clear from the records that the petitions were filed merely to forestall the early execution of judgment and for non-compliance with the rules. The resolution denying due course or dismissing a petition always gives the legal basis.

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xxx xxx xxx The Court is not duty bound to render signed decisions all the time. It has ample discretion to formulate decisions and/or minute resolutions, provided a legal basis is given, depending on its evaluation of a case. The order in the case at bar does not come under either of the above exceptions. As it is settled that an order dismissing a case for insufficient evidence is a judgment 6 on the merits, it is imperative that it be a reasoned decision clearly and distinctly stating therein the facts and the law on which it is based. It may be argued that a dismissal based on lack of jurisdiction is not considered a judgment on the merits and so is not covered by the aforecited provision. There is no quarrel with this established principle. However, the rule would be applicable only if the case is dismissed on the sole ground of lack of jurisdiction and not when some other additional ground is invoked. A careful perusal of the challenged order will show that the complaint was dismissed not only for lack of jurisdiction but also because of the insufficiency of the evidence to prove the invalidity of the sheriff's sale. Regarding this second ground, all the trial court did was summarily conclude "from the very evidence adduced by the plaintiff" that the sheriff's sale "was in complete accord with the requirements of Section 3, Act 3135." It did not bother to discuss what that evidence was or to explain why it believed that the legal requirements had been observed. Its conclusion was remarkably threadbare. Brevity is doubtless an admirable trait, but it should not and cannot be substituted for substance. As the ruling on this second ground was unquestionably a judgment on the merits, the failure to state the factual and legal basis thereof was fatal to the order. Significantly, the respondent court found that the trial court did have jurisdiction over the case after all. This made even more necessary the factual and legal explanation for the dismissal of the complaint on the ground that the plaintiff's evidence was insufficient. In People v. Escober, the trial court in a decision that covered only one and a half pages, single spaced found the defendant guilty of murder and sentenced him to death. Holding that the decision violated the constitutional requirement, the Court observed through then Associate Justice Marcelo B. Fernan: The above-quoted decision falls short of this standard. The inadequacy stems primarily from the respondent judge's tendency to generalize and to form conclusions without detailing the facts from which such conclusions are deduced. Thus, he concluded that the material allegations of the Amended Information were the facts without specifying which of the testimonies or the exhibits supported this conclusion. He rejected the testimony of accused-appellant Escober because it was allegedly replete with contradictions without pointing out what these contradictions consist of or what "vital details" Escober could have recalled as a credible witness. He also found the crime to be attended by the aggravating circumstances of cruelty, nighttime, superior strength, treachery, in band, "among others" but did not particularly state the factual basis for such findings.
7

While it is true that the case before us does not involve the life or liberty of the defendant, as in Escober, there is still no reason for the constitutional short-cut taken by the trial judge. The properties being litigated are not of inconsequential value; they were sold for three and a half million pesos in 1983 and doubtless have considerably appreciated since then, after more than eight years. These facts alone justified a more careful and thorough drafting of the order, to fully inform the parties and the courts that might later be called upon to review it of the reasons why the demurrer to the evidence was sustained and the complaint dismissed. In Romero v. Court of Appeals, 8 the Court, somewhat reluctantly, approved a memorandum decision of the Court of Appeals consisting of 4 pages, single-spaced, which adopted by reference the findings of fact and conclusions of law of the Court of Agrarian Relations. While holding that the decision could be considered 9 substantial compliance with PD 946, Section 18, and BP 10 129, Section 40, Justice Jose Y. Feria nevertheless expressed the misgiving that "the tendency would be to follow the line of least resistance by just adopting the findings and conclusions of the lower court without thoroughly studying the appealed case." Obviously, the order now being challenged cannot qualify as a memorandum decision because it was not issued by an appellate court reviewing the findings and conclusions of a lower court. We note that, contrary to the impression of the respondent court, there is not even an incorporation by reference of the evidence and arguments of the parties, assuming this is permitted. No less importantly, again assuming arguendo that such reference is allowed and has been made, there is no immediate accessibility to the incorporated matters so as to insure their convenient examination by the reviewing court. In Francisco v. 11 Permskul, which is the latest decision of the Court on the issue now before us, we categorically required: . . . Although only incorporated by reference in the memorandum decision of the regional trial court, Judge Balita's decision was nevertheless available to the Court of Appeals. It is this circumstance, or even happenstance, if you will, that has validated the memorandum decision challenged in this case and spared it from constitutional infirmity. That same circumstance is what will move us now to lay down the following requirement, as a condition for the proper application of Section 40 of BP Blg. 129. The memorandum decision, to be valid, cannot incorporate the findings of fact and the conclusions of law of the lower court only by remote reference, which is to say that the challenged decision is not easily and immediately available to the person reading the memorandum decision. For the incorporation by reference to be allowed, it must provide for direct access to the facts and the law being adopted, which must be contained in a statement attached to the said decision. In other words, the memorandum decision authorized under Section 40 of BP Blg. 129 should actually embody the findings of fact and conclusions of law of the lower court in an annex attached to and made an indispensable part of the decision. It is expected that this requirement will allay the suspicion that no study was made of the decision of the lower court and that its decision was merely affirmed without a proper

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examination of the facts and the law on which it was based. The proximity at least of the annexed statement should suggest that such an examination has been undertaken. It is, of course, also understood that the decision being adopted should, to begin with, comply with Article VIII, Section 14 as no amount of incorporation or adoption will rectify its violation. In Escober, the Court observed that the flawed decision "should have been remanded to the court a quo for the rendition of a new judgment" but decided nevertheless to decide the case directly, the records being already before it and in deference to the right of the accused to a speedy trial as guaranteed by the Bill of Rights. However, we are not so disposed in the case now before us. It is not the normal function of this Court to rule on a demurrer to the evidence in the first instance; our task comes later, to review the ruling of the trial court after it is examined by the Court of Appeals and, when proper, its decision is elevated to us. In the present case, we find that the respondent court did not have an adequate basis for such examination because of the insufficiency of the challenged order. It must also be noted that we deal here only with property rights and, although we do not mean to minimize them, they do not require the same urgent action we took in Escober, which involved the very life of the accused. All things considered, we feel that the proper step is to remand this case to the court a quo for a revision of the challenged order in accordance with the requirements of the Constitution. Review by the Court of the other issues raised, most of which are factual, e.g., the allegation of default in the payment of the loan, the existence of a second loan, the nature of the newspapers where the notices of the sale were published, the authority of the person consenting to the postponement of the sale, etc., is impractical and unnecessary at this time. These matters should be discussed in detail in the revised order to be made by the trial court so that the higher courts will know what they are reviewing when the case is appealed. In one case, this Court, exasperated over the inordinate length of a decision rife with irrelevant details, castigated the trial judge for his "extraordinary verbiage." Kilometric decisions without much substance must be avoided, to be sure, but the other extreme, where substance is also lost in the wish to be brief, is no less unacceptable either. The ideal decision is that which, with welcome economy of words, arrives at the factual findings, reaches the legal conclusions, renders its ruling and, having done so, ends. WHEREFORE, the challenged decision of the Court of Appeals is SET ASIDE for lack of basis. This case is REMANDED to the Regional Trial Court of Bulacan, Branch 10, for revision, within 30 days from notice, of the Order of June 6, 1986, conformably to the requirements of Article VIII, Section 14, of the Constitution, subject to the appeal thereof, if desired, in accordance with law. It is so ordered.
12

BATISTING, SEGUNDINO BOLOTAOLO, HEIRS OF DEMOCRITO RANARIO Represented by FRANCISCO RANARIO, HEIRS OF LOPE NAKILA, BONIFACIO BUSCAGAN, MARIANO CAPA, JUAN MORALES, GODOFREDO RACHO, ELIZABETH AMARILLO, BENIGNO ACAMPADO, PEDRO AREGLO, SERVITO BATAO, ELEODORO BATISTING, ROGELIO DE CLARO, SILFORO LIBANDO, HILARIO MARINAS, ALEJANDRO NOJA, HEIRS OF PEDRITA OLAER Represented by surviving spouse Francisco Olaer, HEIRS OF SILFORO MORALES Represented by EVANGELINA MORALES, ANTONIO RETUERTO, STELLA FILIPINAS, TEODOLO FILIPINAS, HEIRS OF MANSUETO NATAD Represented by NATIVIDAD NATAD, AMADO MAGSIGAY, TIMOTEO GOLORAN, GREGORIO SEQUILLA, HEIRS OF ANTONIO CANOY, APOLINARIO PLAZA, JESUS GUDELASAO, HEIRS OF APOLONIO ANTIPASADO, TERESO CAGADAS, LUCIO BARONG, LEONARDO LAPIZ, FRANCISCO PAIGAN, ARTURO ESCOBIDO, BONIFACIO BUNOL, HEIRS OF FRANCISCO PATAYAN Represented by NORMA PATAYAN, SALVADOR CENA, BASILIO PAJE, DOMINADOR DAGONDON, FAUSTINO LASTIMADO, EMPERATRIZ MORAN, EUGENIO MIRA, ANGELO PLAZA, DEMETRIA ABAY-ABAY, ROLANDO GASCON, DOROTEO GASCON, RIZALINO CUBILLAS, HEIRS OF FAUSTINO MAGLAHUS Represented by LUISA MAGLAHUS, and JOEL PLAZA, petitioners, vs. COMMISSION ON AUDIT, Represented by its Chairman, CELSO D. GANGAN and by its Commissioners, SOFRONIO B. URSAL and RAUL C. FLORES, respondents. PUNO, J.: Petitioners were among the more than sixty permanent employees of the Provincial Engineering Office, Province of Agusan del Sur, who were dismissed from the service by then Governor Ceferino S. Paredes, Jr. when the latter assumed office, allegedly to scale down the operations of 1 the said office. On July 11, 1988, a petition for reinstatement was filed by petitioners before the Merit Systems Protection Board (MSPB), docketed as MSPB Case No. 91-1739, alleging that Governor Paredes was motivated by political vengeance when he dismissed them and hired new employees to replace them. It appears that during the pendency of the petition for reinstatement, Governor Paredes issued Memorandum Order No. 3-A dated March 20, 1989 providing for the hiring of casual employees to replace the dismissed employees, allegedly due to exigency of service.1wphi1.nt The MSPB required Governor Paredes to comment on the petition. On February 1, 1989, the governor specifically denied the allegations of petitioners that their dismissal was illegal. Subsequently, an amended petition and an amended answer were filed by the parties. Hearings were conducted by the Civil Service Regional Office No. X, Cagayan de Oro City, where both parties were represented by their respective counsels. The last hearing was held on June 29, 1990, after which the parties submitted their respective memorandum together with their evidence. On January 29, 1993, the MSPB rendered a decision holding that the reduction in work force was not done in

G.R. No. 130685

March 21, 2000

FELIX UY, ROMAN CAGATIN, JAMES ENGUITO, EMMIE HURBODA FRANCISCO OLAER, LEONCIO BUSTAMANTE, FRANCISCO RANARIO, JOE OSIN, JORGE PEDIDA, JOSE BATISTING, LUCIO

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accordance with civil service rules and regulations, and 2 ordering the reinstatement of petitioners. The pertinent portions of said decision state, viz: The focal point of controversy is whether or not Administrative Order No. 88-01 streamlining the personnel complement of the PEO is in accordance with Civil Service Laws, Rules and Regulations. The law applicable in the case at bar, which is hereby quoted as follows are Section 29 of E.O. 292 and Section 14 of the Rules on Personnel Actions and Policies, thus: Sec. 29. Reduction in Force. Whenever it becomes necessary for lack of work or funds or due to change in the scope or nature of an agency's program or as a result of reorganization, to reduce the staff of any department or agency, those in the same group or class of positions in one or more agencies within the particular department or agency wherein the reduction is to be effected, shall be reasonably compared in terms of relative fitness, efficiency and length of service, and those found to be least qualified for the remaining position shall be laid off. (Emphasis supplied). Sec. 14. The names of permanent employees laid off shall be entered in a reemployment list for the appropriate occupation. The list, arranged in the order of the employees' retention credit, shall be kept by the Department or agency where the reduction took place, and a copy thereof shall be furnished the Commission. The Commission shall certify for purposes of reemployment from such list as the opportunity for reemployment arises. It has been conceded that reduction in force due to lack of funds is a valid ground for terminating the services of an employee. But this, of course, is subject to some limitations. While the Governor of the Province of Agusan del Sur may take measures to retrench or reduce the work force yet this must be done in accordance with law and rules. As the plantilla schedule for the period of January to December 1988 would show, there are 106 employees in the provincial Engineering Office and out of these, 53 employees were terminated. There is no showing that these employees were compared in terms of relative fitness, efficiency and length of service. Thus, there is no basis in removing these employees except for the reason of lack of funds. The manifest repugnance of the action taken by Governor Paredes, Jr. was further exacerbated by the issuance of the highly questionable Memorandum Order No. 3-A s. 1989 dated March 20, 1989. Said memorandum provides for the hiring of casuals under the facade of exigency of the public service. It was also a blatant violation of Section 14 of the Rules on Personnel Actions and Policies which succinctly states that the names of permanent employees laid off shall be entered in a reemployment list for the appropriate occupation. The list, arranged in the order of the employees' retention credit, shall be kept by the Department or agency where the reduction took place and copy thereof shall be furnished the Commission. They shall certify for purposes of reemployment from such list as the opportunity for reemployment arises. xxx xxx xxx

Pursuant to a Motion for Clarification filed by petitioners, the MSPB issued an Order dated April 19, 1993 which directed the Provincial Government of Agusan del Sur pay petitioners their back salaries and other money benefits for the period that they had been out of the service until 3 their reinstatement. In another motion dated May 24, 1993, petitioners sought an order directing the Provincial Government of Agusan del Sur to reinstate them and declare as invalid the appointments of those who replaced them. On June 24, 1993, the Provincial Governor of Agusan del Sur was ordered to reinstate the dismissed 4 employees. The Governor continued to refuse to implement the order to reinstate. Another motion was filed by petitioners and hence, an Order was issued by the MSPB on October 8, 1993, directing the Governor to show cause why he should not be declared in contempt. The matter was thereafter brought before the Civil Service Commission (CSC) which issued an Order dated December 14, 1993 directing the Governor to reinstate the employees with the caveat that should he fail to do so, the CSC would be constrained to initiate contempt 5 proceedings against him and other responsible officials. As per its Resolution No. 94-1567 dated March 21, 1994, the CSC actually initiated indirect contempt proceedings against the Provincial Governor who was by then 6 Democrito Plaza. This prompted Governor Plaza to comply, and herein petitioners were finally reinstated to their former positions. The difficulties of petitioners did not end, for on July 9, 1994, the Provincial Administrator, for and in behalf of 7 Governor Plaza, wrote a letter to respondent COA through the Provincial Auditor, inquiring on whether or not: 1. The MSPB Civil Service Commission decision directing the incumbent Provincial Governor, Agusan del Sur to pay back salaries and other benefits of the reinstated sixty one (61) PEO employees, illegally dismissed by the former Provincial Governor Ceferino S. Paredes Jr., is final and executory; 2. The Commission on Audit is the only proper authority to determine disbursement of such is in order; 3. The former Provincial Governor Ceferino S. Paredes, Jr., who perpetrated the illegal act of dismissing the 61 PEO employees, would be personally liable for payment of back salaries and other benefits. In the meantime, the Provincial Treasurer of Agusan del Sur made a partial payment to the reinstated employees on December 12, 1995, representing back salaries in the 8 amount of P2,291,423.34. On July 2, 1996, respondent COA rendered its Decision 9 No. 96-351 holding as follows: As regards the first issue, suffice it to state that the order of payment of the back salaries and other benefits due the petitioners has become final and executory there being no appeal filed by the Provincial Government of Agusan del Sur within the reglementary period. Anent the issue on jurisdiction, the Supreme Court had occasion to rule in the case of Department of Agriculture vs. National Labor Relations Commission . . ., thus: Pursuant, however to C.A. No. 327, as amended by PD No. 1445, the money claim should first be brought to the Commission on Audit.

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The focal point of controversy in the case at bar is the issue as to whether or not subject claim for back salaries and other monetary benefits may be allowed in audit. As a general proposition, a public official is not entitled to any compensation if he has not rendered any service, and the justification for the payment of salary during the period of suspension is that the suspension was unjustified or that the official was innocent . . . . The Civil Service Commission, in Resolution No. 91-1739 dated January 29, 1993 ruled that there was illegal termination due to failure to comply with the provisions of Section 29 of Executive Order No. 292. The said Section 29, supra, provides that in case of reduction of force, those of the same group of positions shall be reasonably compared in terms of relative fitness, efficiency and length of service. As a consequence of the illegal termination of herein claimants, the Civil Service Commission ordered their reinstatement. It is a settled rule that when a government official has been illegally suspended or dismissed, and his reinstatement had been ordered, for all intents and purposes, he is considered as not having left his office, so that he is entitled to all the rights and privileges that accrue to him by virtue of the office that he held . . . . Premises considered, This Commission sees no further legal impediment to the payment of the claims of Ms. Emmie Hurboda et al., of the Provincial Engineering Office, Province of Agusan del Sur, for back salaries and other monetary benefits in the total amount of P3,322,896.06 which has become the personal liability of former Governor Paredes, it appearing that the illegal dismissal was done in bad faith as clearly shown in the herein records. As a result, the Provincial Government of Agusan del Sur, through its Acting Provincial Treasurer, refused to release petitioners' remaining back salaries and other monetary benefits. A motion for reconsideration filed by petitioners was denied by respondent COA in its Decision No. 97-497 10 dated August 28, 1997. In this special civil action for certiorari, petitioners raise the following assignment of errors: (A) The Honorable Commission on Audit committed grave abuse of discretion tantamount to lack of jurisdiction when it promulgated Decision No. 97-497 on August 28, 1997 denying their motion for reconsideration and affirming its Decision No. 96-351, dated July 2, 1996 by ruling that payment of their back salaries and other money benefits became the personal liability of former Governor Ceferino Paredes Jr. and not of the Provincial Government of Agusan del Sur, after the Merit Systems Protection Board and the Civil Service Commission declared its decisions final and executory; (B) The Honorable Commission on Audit has no appellate authority to revise, amend and modify the final and partially executed decisions/orders of the Merit Systems Protection Board and the Civil Service Commission, being the same constitutional commission and co-equal with each other; (C) The decisions of the Merit Systems Protection Board and the Civil Service Commission have already been partially executed by the local government unit of the Province of Agusan del Sur by reinstating petitioners to

their former positions in 1993 and partially paying their back wages in the amount of Two Million Two Hundred Ninety One Four Hundred Twenty Three and Thirty Four (P2,291,423.34) Pesos on December 12, 1995; and (D) The jurisprudence cited by public respondent in the case of Dumlao vs. CA, 114 SCRA 251; Salcedo vs. CA, 81 SCRA 408; and Correa vs. CFI of Bulacan, 92 SCRA 312 are not applicable in this case. The hinge issue is whether respondent COA, in the exercise of its power to audit, can disallow the payment of back wages of illegally dismissed employees by the Provincial Government of Agusan del Sur which has been decreed pursuant to a final decision of the Civil Service Commission. We hold that respondent COA is bereft of power to disallow the payment of petitioners' back wages. FIRST. The ruling of the respondent COA is based on its finding that bad faith attended the dismissal of petitioners. In arriving at this conclusion, respondent COA relied solely on the MSPB decision of January 29, 1993 holding that the dismissal was illegal because first, it was made in violation of Section 29 of EO 292 and Section 14 of the Rules on Personnel Action and Policies, and second, new casual employees were hired under the guise of exigency of the public service. A careful perusal of said Decision will disclose that the MSPB never made a categorical finding of fact that former Governor Paredes acted in bad faith and hence, is personally liable for the payment of petitioners' back wages. Indeed, the MSPB even found that there was lack of funds which would have justified the reduction in the workforce were it not for the procedural infirmities in its implementation. If the MSPB found bad faith on the part of Governor Paredes it would have categorically decreed his personal liability for the illegal dismissal of the petitioners. To be sure, even the petitioners did not proceed from the theory that their dismissal is the personal liability of Governor Paredes. Familiar learning is our ruling that bad faith cannot be presumed and he who alleges bad faith has the onus of 11 proving it. In the case at bar, the decision of the MSPB by itself does not meet the quantum of proof necessary to overcome the presumption of good faith. SECOND. The case at bar brings to the fore the parameters of the power of the respondent COA to decide administrative cases involving expenditure of public funds. 12 Undoubtedly, the exercise of this power involves the quasi-judicial aspect of government audit. As statutorily envisioned, this pertains to the "examination, audit, and settlement of all debts and claims of any sort due from or owing to the Government or any of its subdivisions, 13 agencies and instrumentalities". The process of government audit is adjudicative in nature. The decisions of COA presuppose an adjudicatory process involving the determination and resolution of opposing claims. Its work as adjudicator of money claims for or against the government means the exercise of judicial discretion. It includes the investigation, weighing of evidence, and resolving whether items should or should not be included, or as applied to claim, whether it should be allowed or disallowed in whole or in part. Its conclusions are not mere opinions but are decisions which may be elevated to 14 the Supreme Court on certiorari by the aggrieved party.

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Accordingly, the fundamental requirements of procedural due process cannot be violated in proceedings before the COA.1wphi1 In the case at bar, former Governor Paredes was never made a party to nor served a notice of the proceedings before the COA. While administrative agencies exercising quasi-judicial powers are not hide bound by technical procedures, nonetheless, they are not 15 free to disregard the basic demands of due process. Notice to enable the other party to be heard and to present evidence is not a mere technicality or a trivial matter in any administrative proceedings but an 16 indispensable ingredient of due process. It would be unfair for COA to hold former Governor Paredes personally liable for the claims of petitioners amounting to millions of pesos without giving him an opportunity to be heard and present evidence in his defense. Our rulings holding that public officials are personally liable for damages arising from illegal acts done in bad faith are premised on said officials having been sued both in their 17 official and personal capacities. THIRD. There is a further impediment in the exercise of the audit power of the respondent COA. The MSPB decision of January 29, 1993 became final and executory when the Provincial Government of Agusan del Sur failed to appeal within the reglementary period. To be sure, the decision has already been partially executed as the Acting Provincial Treasurer had paid petitioners some of their backwages. Again, our undeviating jurisprudence is that final judgments may no longer be reviewed or in any way modified directly or indirectly by a higher court, not even by the Supreme Court, much less by any other official, 18 branch or department of Government. Administrative decisions must end sometime as public policy demands 19 that finality be written on controversies. In the case at bar, the action taken by COA in disallowing the further payment by the Provincial Government of Agusan del Sur of backwages due the petitioners amended the final decision of the MSPB. The jurisdiction of the MSPB to render said decision is unquestionable. This decision cannot be categorized as void. Thus, we cannot allow the COA to set it aside in the exercise of its broad powers of audit. The audit authority of COA is intended to prevent irregular, unnecessary, excessive, extravagant or unconscionable expenditures, or uses of government 20 funds and properties. Payment of backwages to illegally dismissed government employees can hardly be described as irregular, unnecessary, excessive, extravagant or unconscionable. This is the reason why the Acting Provincial Treasurer, despite the pendency of his query with the COA, proceeded to release government funds in partial payment of the claims of petitioners. It cannot likewise be said that the MSPB gravely abused its discretion in failing to hold former Governor Paredes personally liable. In the first place, it is not clear whether the petitioners sued former Governor Paredes in his personal capacity. Indeed, they did not appeal the ruling of the MSPB which did not hold Governor Paredes personally liable for the payment of their back salaries. Moreover, jurisprudence exists that under exceptional circumstances public officials who acted in bad faith in the performance of their official duties were not held 21 personally liable. We are not unaware of our ruling in Aguinaldo v. 22 Sandiganbayan, that the conclusive effect of the finality

of the COA's decision on the executive branch of the government relates solely to the administrative aspect of the matter. However, in the case at bar, the disallowance of the payment of backwages radically alters the MSPB decision which held the provincial government, not the provincial governor, personally liable. The COA decision affects not only the procedural, but more importantly the substantive rights of the parties. FOURTH. We subscribe to the time-honored doctrine that estoppel will not lie against the State. In the case of CIR v. 23 CA, et al., however, we held that "admittedly the government is not estopped from collecting taxes legally due because of mistakes or errors of its agents. But like other principles of law, this admits of exceptions in the interest of justice and fair play, as where injustice will result to the taxpayer." In the case at bar, a stringent application of the rule exempting the state from the equitable principle of estoppel will prejudice petitioners who are lowly employees of government. Petitioners' sufferings started way back in 1988 when they were unceremoniously dismissed from the service. It took five years for the MSPB to decide in their favor. Still, they were not reinstated until the following year, and this only after several motions filed and orders issued to compel the concerned public officials to reinstate them. Then again, despite an Order issued as early as April 19, 1993 by the MSPB, the provincial government was able to pay petitioners, and even only partially at that, a good two and a half years after or on December 12, 1995. Now, after more than a decade, respondent COA holds that petitioners should run after Governor Paredes in his personal capacity to collect their claims. Worse, petitioners stand in danger of being made to reimburse what has been paid to them. Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privilege in life should have more in 24 law. Rightly, we have stressed that social justice legislation, to be truly meaningful and rewarding to our workers, must not be hampered in its application by longwinded arbitration and litigation. Rights must be asserted 25 and benefits received with the least inconvenience. And the obligation to afford protection to labor is incumbent not only on the legislative and executive branches but also on 26 the judiciary to translate this pledge into a living reality. Social justice would be a meaningless term if an element of rigidity would be affixed to the procedural precepts. Flexibility should not be ruled out. Precisely, what is sought to be accomplished by such a fundamental principle expressly so declared by the Constitution is the effectiveness of the community's effort to assist the economically underprivileged. For under existing conditions, without such succor and support, they might not, unaided, be able to secure justice for themselves. To make them suffer, even inadvertently, from the effect of a judicial ruling, which perhaps they could not have anticipated when such deplorable result could be avoided, would be to disregard what the social justice concept 27 stands for. Be that as it may, the Provincial Government of Agusan del Sur is not without remedy against Governor Ceferino S. Paredes, Jr., if he indeed acted in bad faith. Subject to the usual defenses, the proper suit may be filed to recover

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whatever damages may have been suffered by the provincial government. WHEREFORE, the Orders of the respondent Commission on Audit dated July 2, 1996 and August 28, 1997 are SET ASIDE.1wphi1.nt SO ORDERED.

reprimand with a warning that she "be more circumspect in her actuations, otherwise, these should be dealt with 5 more severely in the future." Petitioner elevated the decision of the MSPB before respondent commission which subsequently issued the questioned resolution dismissing the appeal on the ground that UP is not a party adversely affected by the decision of the MSPB and, therefore, it has no right to appeal therefrom, aside from the fact that the CSC has no appellate jurisdiction over administrative disciplinary cases where the penalty imposed is suspension of less than thirty (30) days. Petitioner now claims that respondent commission erred in affirming the MSPB decision which supposedly amended the charge against and the penalty imposed upon private respondent, asseverating that the MSPB has no jurisdiction to amend the charge from one of conduct prejudicial to the interests of the service to one of violation of reasonable office regulations. It likewise claims that there exists substantial evidence to sustain petitioner's holding that private respondent is guilty of conduct prejudicial to the interests of the university. Public respondents, through the Solicitor General, have frontally met said issues with arguments of such puissance as to warrant dispensing with further comment from private respondent. On a judicious assay of the submissions of the parties, we find no merit in the petition. The right to appeal is not a natural right nor a part of due process; it is merely a statutory privilege which may be exercised only in the manner prescribed by and in 6 accordance with the provisions of the law. This doctrine is equally made applicable to quasi-judicial proceedings so that one must first ascertain the law applicable to determine whether or not the party can appeal from the 7 order or decision. The reason for this is that even administrative proceedings must end sometime, just as public policy demands that finality be written on judicial 8 controversies. Section 37 of Presidential Decree No. 807, or the Civil Service Decree, provides that the Civil Service Commission shall have appellate jurisdiction over all administrative disciplinary cases involving the imposition of a penalty of suspension for more than thirty (30) days, or a fine in an amount exceeding thirty (30) days salary, demotion in rank or salary, or transfer, removal or 9 dismissal from office. The inescapable conclusion is that in an administrative case, where the penalty imposed is not one of those covered by or is less than those enumerated under Section 37, the decision of the disciplining authority shall be final and inappealable. Respondent CSC has no jurisdiction to review the same on appeal. In the case at bar, it cannot be gainsaid that the decision of the MSPB merely imposed a reprimand on herein private respondent with a stern warning that a similar infraction in the future shall be dealt with more severely. Under such circumstances, even private respondent cannot appeal therefrom to respondent Commission. Furthermore, it is likewise provided by Presidential Decree No. 807, specifically in Section 39 thereof, that appeals, where allowable, shall be made by the party adversely affected by the decision within fifteen (15) days from

G.R. No. 108740 December 1, 1993 UNIVERSITY OF THE PHILIPPINES, petitioner, vs. CIVIL SERVICE COMMISSION, MERIT SYSTEMS PROTECTION BOARD AND SOCORRO V. GREGORIO, respondents. U.P. Office of Legal Services for petitioner. Angel Colet for private respondent.

REGALADO, J.: The instant petition seeks the reversal of Resolution No. 93-006 issued by respondent Civil Service Commission 1 (CSC) on January 5, 1993 affirming the decision of the Merit Systems Protection Board (MSPB) and dismissing the appeal of herein petitioner. The records show that on May 27, 1989, the President of the University of the Philippines (UP) filed an administrative case against private respondent Socorro V. Gregorio for conduct prejudicial to the interest of the university, charging her in this wise: That sometime before June 1988 you, as employee of the University connected with the U.P. Diliman Police bought the self-built house of Mr. Ignacio P. Hementera from his wife, Rosalinda Hementera, while the husband is (sic) abroad. Such sale is null and void and is not recognized under Memo No. 83 of the Office of the President and your occupancy of the land which said house stands is without the knowledge, consent and authority of the University authorities. Such conduct is prejudicial to the interest of the University punishable under P.D. No. 807, 2 Civil Service Decree. Pursuant thereto, an investigation was conducted by the Administrative Disciplinary Tribunal (ADT), constituted for that purpose and chaired by petitioner's present counsel, wherein the parties presented their respective testimonial and documentary evidence. A formal investigation report was subsequently submitted by ADT finding that there is more than substantial evidence to show that respondent is 3 guilty of the offense charged. Consequently, UP President Jose V. Abueva issued an 4 Order, dated March 7, 1991, finding private respondent guilty as charged and imposing upon her the penalty of six (6) months suspension chargeable against her leave credits. She was also ordered to vacate the housing unit within fourteen (14) days from notice of said order, to deliver possession thereof to the university, and to accept the offer of Ignacio P. Hementera to refund to her the amount of P25,000.00 which she paid for said unit. Private respondent appealed to the MSPB which thereafter rendered a decision on October 21, 1991 in MSPB Case No. 91-1253, setting aside the appealed decision, finding her guilty only of violation of reasonable office regulations, and modifying the penalty to a

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receipt thereof. The term "party adversely affected" has been interpreted by this Court as referring to the person or the respondent employee against whom the administrative disciplinary case is filed. It has thus been held in the case of Paredes vs. Civil 11 Service Commission, et al., and reiterated in Mendez 12 vs. Civil service Commission, et al., that: Based on the above provisions of law, appeal to the Civil Service Commission in an administrative case is extended to the party adversely affected by the decision, that is, the person or the respondent employee who has been meted out the penalty of suspension for more than thirty days; or fine in an amount exceeding thirty days salary, demotion in rank or salary, or transfer, removal or dismissal from office. The decision of the disciplining authority is even final and not appealable to the Civil Service Commission in cases where the penalty imposed is suspension for not more than thirty days or fine in an amount not exceeding thirty days salary. . . . Here the MSPB, after the hearing and the submission of memoranda, exonerated private respondent of all charges except for habitual tardiness. The penalty was only a reprimand so that even private respondent Amor, the party adversely affected by the decision, cannot even interpose an appeal to the Civil Service Commission. As we have earlier stated, the exercise of the right to appeal, being merely a statutory right, is subject to the requirements of the governing law. No right to appeal having been granted to herein petitioner under the circumstances obtaining in this case, it can not successfully invoke or avail of such remedy. Finally, we find no cogency in the argument of petitioner that the MSPB amended the charge against private respondent, as well as the corresponding penalty. This is merely a case where the MSPB found that, on the basis of the facts and the evidence adduced herein, private respondent should only be held guilty of a violation of reasonable office regulations. What this obviously means is that the facts and the evidence obtaining in the case do not suffice to warrant a finding of guilt for conduct prejudicial to the interests of the university. Withal, it is legally permissible, as in fact it is recognized both in law and jurisprudence, that a party may be found guilty of a lesser offense than that charged. It is not how petitioner wishes to categorizes the offense but what that offense is made out by the evidentiary facts and the law. Besides, it has generally been the accepted rule that where the findings of the administrative body are amply supported by substantial evidence, such findings are accorded not only 13 respect but finality. Accordingly, it cannot be said that the MSPB, in petitioner's deplorably unrestrained language, "simplemindedly likened her offense to the violation of an ordinary office regulation." On the contrary, said respondent board has pithily resolved with controversy under a ratiocination which we quote with approval: The appealed decision found Gregorio guilty of Grave Misconduct. We are, however, of the belief that under the circumstances obtaining, the evidence of guilt of grave misconduct is wanting. In order for grave misconduct to exist, there must be substantial evidence showing that the acts complained of were corrupt or inspired by an intention to violate the law, or were in persistent disregard

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of well-known legal rules (Impeachment of Horilleno, 43 Phil. 212). On the contrary, the record is bereft of any proof which establishes that Gregorio is guilty of grave misconduct. It is a fact that there exists a U.P. Memorandum No. 83, dated September 2, 1981, which prohibits the Sale, Donation, or Assignment of PrivateOwned Houses in the U.P. Campus. Any violation thereof cannot be equated with misconduct. Misconduct in office implies a wrongful intention, and not mere indiscretion, and acts done in good faith, i.e., an act of buying a real property right, which constitutes only an error of judgment, cannot be characterized as a misconduct in office; hence appellant Gregorio could not be guilty thereof, but only of 14 violation of office regulations. In addition, the sufficiency or insufficiency of evidence in support of the findings of the MSPB is a factual issue which is not within the purview of an original action for certiorari under Rule 65 of the Rules of Court, absent a showing of such grave abuse of discretion as would amount to lack or excess of jurisdiction. Petitioner would do well to recall that the extraordinary writ it prays for does not issue to correct an error of judgment or even a simple abuse of discretion, neither of which is present in nor taints the challenged disposition. WHEREFORE, the instant petition is DISMISSED and the impugned resolution is hereby AFFIRMED in toto. SO ORDERED.

G.R. No. 71664 February 28, 1992 BAGUIO COUNTRY CLUB CORPORATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, ASSOCIATED LABOR UNION (ALU) and JIMMY CALAMBA, respondents. Guillermo B. Bandonill and A.N. Bolinao, Jr. for petitioner. Jose C. Evangelista for Jimmy Calamba.

MEDIALDEA, J.: This petition for certiorari seeks to annul and set aside the resolution issued by the respondent National Labor Relations Commission dated June 10, 1985 dismissing the appeal of petitioner for lack of merit and affirming in toto the decision of the Executive Labor Arbiter dated September 15, 1982 declaring private respondent Calamba as a regular employee entitled to reinstatement to the position of gardener without loss of seniority and with full backwages, benefits and privileges from the time of his dismissal up to reinstatement including 13th month pay. The antecedent facts are as follows: Petitioner Baguio Country Club Corporation (corporation) is a recreational establishment certified by the Ministry of Labor and Employment as an" entertainment-service" establishment. Respondent National Labor Relations Commission (Commission) is a government instrumentality created by law, impleaded in its official capacity, while private respondent Associated Labor Union (union) is a duly registered labor organization and private respondent Jimmy Calamba is an employee of the petitioner corporation as laborer, dishwasher, and gardener.

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Private respondent Jimmy Calamba was employed on a day to day basis in various capacities as laborer and dishwasher for a period of ten (10) months from October 1, 1979 to July 24, 1980. On September 1, 1980 to October 1, 1980, private respondent Calamba was hired as a gardener and rehired as such on November 15, 1980 to January 4, 1981 when he was dismissed by the petitioner corporation. (see Rollo, pp. 28-36) On August 3, 1981, private respondent Jimmy Calamba assisted by private respondent union instituted a complaint against petitioner corporation with the Ministry of Labor (now Department of Labor and Employment), Baguio District Office, Baguio City for unfair labor practice, illegal dismissal and non-payment of 13th month pay for 1979 and 1980. The Executive Labor Arbiter Sotero L. Tumang rendered a decision on September 15, 1982 declaring private respondent Calamba as a regular employee and ordering petitioner to reinstate private respondent to the position of gardener without loss of seniority and with full backwages, benefits and privileges from the time of his dismissal up to reinstatement including 13th month pay. Labor Arbiter Tumang found as follows: After a careful perusal of the facts presented by the parties, we find the complaint for illegal dismissal and nonpayment of thirteenth (13th) month pay, meritorious for the following reasons: 1. Complainant Jimmy Calamba has attained regular status as an employee of the Club on account of the nature of the job he was hired, to perform continuously and on staggered basis for a span of thirteen months. True that there were employment contracts executed between the Club and the complainant indicating the period or the number of days the complainant is being needed but what is to be considered is not the agreement, written or otherwise, of the parties in determining the regularity or casualness of job but it should be the nature of the job. Clearly, the work of a gardener is not a seasonal or for a specific period undertaking but it is a whole year round activity. We must not lose sight of the fact that the Baguio Country Club Corporation is an exclusive Club with sustaining members who avails (sic) of its facilities the whole year round and it is necessary, is has been observed and of common knowledge, that the gardens including the green of its golf course where the complainant was assigned must be properly kept and maintained. 2. Being a regular employee with more than one (1) year length of service with the respondent, Jimmy Calamba could not be terminated without a just or valid cause. This is so explicit in our Constitution that the security of tenure of a worker must be safeguarded and protected and Jimmy Calamba should enjoy no less protection. 3. Jimmy Calamba was dismissed without any written clearance from the Ministry of Labor and Employment prior to his termination. Worse, the respondent fired the complainant from his job due to the a (sic) alleged expiration of his employment contract ten (10) times but not even a single report of his dismissal as mandated by law was submitted to the Ministry of Labor and Employment.

4. The Company did not refute the claim of Jimmy Calamba for payment of his thirteenth (13th) month pay under P.D. 851 nor presented any report of compliance to that effect with the Ministry of Labor and Employment and, therefore, he must be paid correspondingly. (Rollo, pp. 3940) Hence, the petitioner interposed an appeal to the respondent Commission. On June 10, 1985, after finding that there existed no sufficient justification to disturb the appealed decision, the respondent Commission rendered a resolution dismissing the appeal for lack of merit. Hence, this present petition raising four (4) assignments of errors, which are as follows: I THAT THE RESPONDENT COMMISSION GRAVELY ERRED IN HOLDING THAT PRIVATE RESPONDENT JIMMY CALAMBA WAS A "CASUAL" EMPLOYEE AND HAD ATTAINED THE STATUS OF A REGULAR EMPLOYEE, DESPITE THE INCONTROVERTIBLE FACT THAT SAID PRIVATE RESPONDENT WAS A CONTRACTUAL AND SEASONAL EMPLOYEE. II THAT THE RESPONDENT COMMISSION GRAVELY ERRED IN HOLDING THAT THE CONCLUSIONS OF THE EXECUTIVE LABOR ARBITER WERE FULLY SUPPORTED BY THE EVIDENCE AND IN UPHOLDING THE REINSTATEMENT OF PRIVATE RESPONDENT JIMMY CALAMBA. III THAT THE RESPONDENT COMMISSION GRAVELY ERRED IN HOLDING THAT THE DISMISSAL OF PRIVATE RESPONDENT JIMMY CALAMBA REQUIRED PRIOR CLEARANCE FROM THE MINISTRY OF LABOR AND EMPLOYMENT EACH TIME HIS CONTRACT OF EMPLOYMENT EXPIRED. IV THAT THE RESPONDENT COMMISSION GRAVELY ERRED IN NOT HOLDING THAT PRIVATE RESPONDENT ASSOCIATED LABOR UNION HAS NO LEGAL PERSONALITY TO FILE THIS CASE FOR PRIVATE RESPONDENT JIMMY CALAMBA BEFORE THE REGIONAL OFFICE OF THE NATIONAL LABOR RELATIONS COMMISSION, AS SAID PRIVATE RESPONDENT BEING A CONTRACTUAL EMPLOYEE IS EXPRESSLY EXCLUDED FROM THE BARGAINING UNIT UNDER THE COLLECTIVE BARGAINING AGREEMENT (Rollo, pp. 98-99) Petitioner maintains that private respondent Calamba was a contractual employee whose employment was for a fixed and specific period as set forth and evidenced by the private respondent's contracts of employment, the pertinent portions of which are quoted as follows: xxx xxx xxx . . . the employment may be terminated any time without liability to the Baguio Country Club other than for salary actually earned up to and including the date of last service.

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His/her employment shall be on a day to day BASIS for a temporary period . . . subject to termination at any time at the discretion of the Baguio Country Club Corporation. xxx xxx xxx (Rollo, p. 7) In addition, petitioner stresses that there was absolutely no oral or documentary evidence to support the conclusion of the Executive Labor Arbiter which was subsequently affirmed by the respondent Commission that private respondent Calamba has rendered thirteen (13) months of continuous service. On the contrary, respondent Commission through the Solicitor General argues that private respondent Calamba, having rendered services as laborer, gardener and dishwasher for more than one (1) year, was a regular employee at the time his employment was terminated. Moreover, the nature of private respondent Calamba's employment as laborer, gardener, and dishwasher pertains to a regular employee because they are necessary or desirable in the usual business of petitioner as a recreational establishment. The pivotal issue therefore in whether or not the private respondent Jimmy Calamba has acquired the status of a regular employee at the time his employment was terminated. After a careful review of the records of this case the Court finds no merit in the petition and holds that the respondent Commission did not gravely abuse its discretion when it affirmed in toto the decision of the labor arbiter. The law on the matter is Article 280 of the Labor Code which defines regular and casual employment as follows: Art. 280. Regular and Casual Employment. The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are necessary or desirable in the usual business or trade of the employer, except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That any employee who has rendered at least one year of service, whether such service is continuous or broken, shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such actually exists. This provision reinforces the Constitutional mandate to protect the interest of labor. Its language evidently manifests the intent to safeguard the tenurial interest of the worker who may be denied the rights and benefits due a regular employee by virtue of lopsided agreements with the economically powerful employer who can maneuver to keep an employee on a casual status for as long as convenient. Thus, contrary agreements notwithstanding, an employment is deemed regular when the activities performed by the employee are usually necessary or

desirable in the usual business or trade of the employer. Not considered regular are the so-called "project employment" the completion or termination of which is more or less determinable at the time of employment, such as those employed in connection with a particular construction project, and seasonal employment which by its nature is only desirable for a limited period of time. However, any employee who has rendered at least one year of service, whether continuous or intermittent, is deemed regular with respect to the activity he performed and while such activity actually exits. The primary standard, therefore, of determining a regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. Also, if the employee has been performing the job for at least one year, even if the performance is not continuous or merely intermittent, the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. Hence, the employment is also considered regular, but only with respect to such activity and while such activity exists. (De Leon v. National Labor Relations Commission, G.R. No. 70705, August 21, 1989. 176 SCRA 615, 620-621) In the case at bar, the petitioner corporation, which is certified by the Ministry of Labor and Employment as an "entertainment-service" establishment, claims that private respondent was contracted for a fixed and specific period. However, the records are that the private respondent was repeatedly re-hired to perform tasks ranging from dishwashing and gardening, aside from performing maintenance work. Such repeated rehiring and the continuing need for his service are sufficient evidence of the necessity and indispensability of his service to the petitioner's business or trade. The law demands that the nature and entirety of the activities performed by the employee be considered. It is not tenable to argue that the aforementioned tasks of private respondent are not necessary in petitioner's business as a recreational establishment, just as it cannot be said that only those who are directly involved in providing entertainment service may be considered as necessary employees. Otherwise, there would have been no need for the regular maintenance section of petitioner corporation. Furthermore, the private respondent performed the said tasks which lasted for more than one year, until early January, 1981 when he was terminated. Certainly, by this fact alone he is entitled by law to be considered a regular employee. Owing to private respondent's length of service with the petitioner corporation, he became a regular employee, by operation of law, one year after he was employed. It is more in consonance with the intent and spirit of the law to rule that the status of regular employment attaches to the casual employee on the day immediately after the end of his first year of service. To rule otherwise is to impose a

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burden on the employee which is not sanctioned by law. (see Kimberly Independent Labor Union for Solidarity, Activism and Nationalism in Line Industries and Agriculture v. Drilon, G.R. No. 77629, May 9, 1990, 185 SCRA 190, 203-204) It is of no moment that private respondent was told when he was hired that his employment would only be "on a day to day basis for a temporary period" and may be terminated at any time subject to the petitioner's discretion. Precisely, the law overrides such conditions which are prejudicial to the interest of the worker. Evidently, the employment contracts entered into by private respondent with the petitioner have the purpose of circumventing the employee's security of tenure. The Court therefore, rigorously disapproves said contracts which demonstrate a clear attempt to exploit the employee and deprive him of the protection sanctioned by the Labor Code. It is noteworthy that what determines whether a certain employment is regular or casual is not the will and word of the employer, to which the desperate worker often accedes. It is the nature of the activities performed in relation to the particular business or trade considering all circumstances, and in some cases the length of time of its performance and its continued existence. (see De Leon v. NLRC, Ibid) All premises considered, the Court is convinced that the assailed resolution of the respondent Commission is not tainted with arbitrariness that would amount to grave abuse of discretion or lack of jurisdiction and therefore, We find no reason to disturb the same. ACCORDINGLY, the petition is DISMISSED for lack of merit. SO ORDERED.

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